Saturday, April 30, 2016

CNBC Has Seriously Underestimated the Sears Turnaround Story

April 30, 2016
Why many retirees will run out of money

For example, 9 percent thought it would be all right to withdraw 15 to 24 percent of their savings annually. Even with positive investment performance, that would almost certainly deplete a nest egg within a decade.

9 percent of these investors may have complete and utter faith in the Sears turnaround story.

Oh, sure. SHLD closed down 9% on Friday, is down 20% for the year, and is down 89% from its peak in 2007 (adjusted for dividends and splits). That's good news though! Why?

Return to the mean, baby. Return to the mean.

You'd feel downright silly only withdrawing 4% of your savings each year knowing that your heavily leveraged and undiversified Sears portfolio would shortly be returning to the mean! Sure thing! Can't lose!

Bad Mark. Bad. Bad. ;)


mab said...

Our Cramer top ten list now goes to eleven!

Cramer thinks SHLD is the next Berkshire Hathaway!

Stagflationary Mark said...


Oh, my! Hahaha! Hahaha!!

Makes me think we can't even have a list any longer!!! Why?

The answer.