Saturday, June 19, 2004
(Sorry this post is so long folks, but I would appreciate it if you would read it all. I haven't been posting much because this monstrosity has been floating around. I've really been dreading it. That and the changes that I want to make on the blog.)
Things are changing at BTCA. We aren't getting paid as much. Well, actually I am. They won't be lowering our pay, just the way that we get paid. We used to get four or five percent raises based on how good of a worker that we are. Now we just get 40 and 55 cent raises. Now this breaks down like this. If you get paid less than 11 dollars then you get bigger raises. If you get less than eleven dollars you get smaller raises.(Assuming your getting the greater raise.)
Can't say that I blame them. After all, there is no power as great as compound interest. The truth is that a couple of years ago I realized. "Heck even if I get a standard raise then, I'm still doing pretty well." I guess that attitude is why they are altering the pay scale. You have to kill somebody to get fired at BTCA, and there are some people that have been there twice as long as I have been. They could easily be getting raises of a dollar a year.
The thing is that forty cents is a lot to bust your hump for. I mean you work forty hours a week 52 weeks a year. (Okay, there's a vacation in there somewhere but the math's the same) 52*40*.40=832 Dollars a year. Is it worth it?
Well had you bought Stock in Marvel Comics at 16 dollars a share and sold it last Friday, they you would have made 2.67 a share. If you had bought 100 shares (price $1,600) You would have made 267 dollars. Had you bought 200 shares ($3,200) you would have 534 dollars. With 300 shares ($4800) you'd have made 801 dollars a year. That's pretty close to what you made with that forty cent raise. Now had you sold when it broke 22 dollars a share (It's high was been 23.82) Then you would have done well. That's 6 dollars a share. The numbers are much nicer. (600/1200/1800)
Of course, figuring out which stock to buy is the trick. Had you held Southwest Airlines in that time you would have lost a dollar for each share.
I picked these stocks because I have made money on these stocks. I bought Marvel when it was four dollars and sold somewhere around eight. Then I bought it again when it dropped back to five and sold again when it hit eight. A total profit of about 700 dollars. (Pull up the five year chart, you can see it was this low.) Of course this was over two years ago. Had I held my 200 shares until today it would be worth over $3,000. I would have tripled my money.
The trick is to figure out when to buy and when to sell. I got cocky and pissed away all my profits on wonder stocks like K-Mart, WorldCom, and such. Seems like somebody else declared bankruptcy while I held them but I can't remember whom.
Anyway, now some of you thought a few paragraphs back, "well Gunny, it must be nice to have a few hundred dollars to gamble away in the stock market." The truth is why don't you?
I work with a guy at BTCA. We'll call him Jim. Jim is recently married and recently became a father. He's a decent guy, but he works two full time jobs. Now he is 25, but the truth is that life isn't going to get any cheaper, and neither are kids. Kids expenses can grow much faster than that 832 dollars a year. Heck a pair of my glasses cost half that much. (That's because they are extra tough. If I bought cheap ones at half that price, I'd break them in six months.) The question is how much would you have to work to support yourself and your rising expenses?
Jim is 25 now, but what happens when the kid hits 16 and Jim is 41. Is that eight hundred a year going to buy that kid a car? (With inflation, that won't buy tires.) Will that eight hundred a year pay for college in a couple of years. Will Jim still be working two jobs like he is now? Probably. He's got a thirty year mortgage on that new house. Or only able to work one job because he's worn himself out. That would cut his pay in half. Of course none of us want to get paid less, do we?
The truth is that Jim will be dead if he works two jobs for 16 years. Or crazy from only getting 3 hours of sleep a day.
Of course, you work to support yourself. Your wife works to support herself. What of you get an extra mouth to feed? Or two? With double family wouldn't you need double the income? (So says the childless bachelor.) I want to grab Jim, shake him, and yell, "I sure hope you are saving a great deal of your income, because you're rocketing to the poorhouse."
That's why you must invest. Because life ain't getting any cheaper.
Things are changing at BTCA. We aren't getting paid as much. Well, actually I am. They won't be lowering our pay, just the way that we get paid. We used to get four or five percent raises based on how good of a worker that we are. Now we just get 40 and 55 cent raises. Now this breaks down like this. If you get paid less than 11 dollars then you get bigger raises. If you get less than eleven dollars you get smaller raises.(Assuming your getting the greater raise.)
| Rate of pay | 5% | New Pay | Old Pay |
| 8.00 | .40 | 8.55 | 8.40 |
| 11.00 | .55 | 8.55 | 8.55 |
| 13.00 | .65 | 13.55 | 13.65 |
| 15.00 | .75 | 15.55 | 15.75 |
Can't say that I blame them. After all, there is no power as great as compound interest. The truth is that a couple of years ago I realized. "Heck even if I get a standard raise then, I'm still doing pretty well." I guess that attitude is why they are altering the pay scale. You have to kill somebody to get fired at BTCA, and there are some people that have been there twice as long as I have been. They could easily be getting raises of a dollar a year.
The thing is that forty cents is a lot to bust your hump for. I mean you work forty hours a week 52 weeks a year. (Okay, there's a vacation in there somewhere but the math's the same) 52*40*.40=832 Dollars a year. Is it worth it?
Well had you bought Stock in Marvel Comics at 16 dollars a share and sold it last Friday, they you would have made 2.67 a share. If you had bought 100 shares (price $1,600) You would have made 267 dollars. Had you bought 200 shares ($3,200) you would have 534 dollars. With 300 shares ($4800) you'd have made 801 dollars a year. That's pretty close to what you made with that forty cent raise. Now had you sold when it broke 22 dollars a share (It's high was been 23.82) Then you would have done well. That's 6 dollars a share. The numbers are much nicer. (600/1200/1800)
Of course, figuring out which stock to buy is the trick. Had you held Southwest Airlines in that time you would have lost a dollar for each share.
I picked these stocks because I have made money on these stocks. I bought Marvel when it was four dollars and sold somewhere around eight. Then I bought it again when it dropped back to five and sold again when it hit eight. A total profit of about 700 dollars. (Pull up the five year chart, you can see it was this low.) Of course this was over two years ago. Had I held my 200 shares until today it would be worth over $3,000. I would have tripled my money.
The trick is to figure out when to buy and when to sell. I got cocky and pissed away all my profits on wonder stocks like K-Mart, WorldCom, and such. Seems like somebody else declared bankruptcy while I held them but I can't remember whom.
Anyway, now some of you thought a few paragraphs back, "well Gunny, it must be nice to have a few hundred dollars to gamble away in the stock market." The truth is why don't you?
I work with a guy at BTCA. We'll call him Jim. Jim is recently married and recently became a father. He's a decent guy, but he works two full time jobs. Now he is 25, but the truth is that life isn't going to get any cheaper, and neither are kids. Kids expenses can grow much faster than that 832 dollars a year. Heck a pair of my glasses cost half that much. (That's because they are extra tough. If I bought cheap ones at half that price, I'd break them in six months.) The question is how much would you have to work to support yourself and your rising expenses?
Jim is 25 now, but what happens when the kid hits 16 and Jim is 41. Is that eight hundred a year going to buy that kid a car? (With inflation, that won't buy tires.) Will that eight hundred a year pay for college in a couple of years. Will Jim still be working two jobs like he is now? Probably. He's got a thirty year mortgage on that new house. Or only able to work one job because he's worn himself out. That would cut his pay in half. Of course none of us want to get paid less, do we?
The truth is that Jim will be dead if he works two jobs for 16 years. Or crazy from only getting 3 hours of sleep a day.
Of course, you work to support yourself. Your wife works to support herself. What of you get an extra mouth to feed? Or two? With double family wouldn't you need double the income? (So says the childless bachelor.) I want to grab Jim, shake him, and yell, "I sure hope you are saving a great deal of your income, because you're rocketing to the poorhouse."
That's why you must invest. Because life ain't getting any cheaper.
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