John Wasik

CHICAGO (Reuters) – Once again the seductive siren call of technology stocks beckons investors. Especially after Apple announced a huge stock buyback Monday along with its first dividend since 1995.

Should you follow that call, or put wax in your ears the way Odysseus’s crew did when they passed the island of the seductive sirens?

There is always a safer course. Sure, technology share returns may be singing a pretty song right now. The S&P North American Technology Sector Index (Total Return) is up about 18 percent year to date through March 16, according to Standard and Poor’s. The sub-index for technology that tracks hardware has risen about 25 percent.

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The love affair with Apple products and shares continues unabated. Microsoft is a less sexy offering, but is still relatively ubiquitous in the software world. Along with telecom giants AT&T and IBM, these tech goliaths comprise four out of the top 10 constituents of the S&P 500 index.

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Tech is back in such a big way that, with a year to date return of 19.6 percent (as of March 16), it has almost eclipsed the financial services (up 21 percent for the same period) group as the largest single sector within the S&P 500. This pretty much brings tech stocks back to where they were at the height of the dotcom bubble. Is it a mere coincidence that all this happened right around the time the 244-year-old Encyclopedia Britannica went to all-digital editions?

By John Wasik

(Reuters) – I got a letter from my bank the other day offering a streamlined refinancing deal for my current home mortgage. It was one of those “quickie” offers tailor-made for my loan situation and designed to net swift business for the bank.

What was advertised in the letter seemed like a decent deal — a 30-year, fixed-rate loan at a 4.16-percent annual percentage rate — so I called the bank for more details.

As it turns out, there was a lot of fine print that made it seem less decent, but I had to ask a lot of questions to find that out. While mortgage rates are still at generational lows, making it tempting to refinance, you have to scrutinize any deal that is offered. You may not even qualify for the appealing rates that get dangled in front of you.

CHICAGO (Reuters) – When a profitable company is sitting on tens of billions of dollars in idle cash, why can’t it automatically raise dividends to reward its shareholders? After all, with savings yields at dismal levels – and likely to remain so – those on fixed-incomes could use a boost.

But companies won’t share the wealth, and the reason why they won’t is an indictment of the U.S. government’s inaction on corporate tax loopholes.

The problem in Washington: Corporations are offshoring more than $2 trillion in corporate cash.

CHICAGO, March 12 (Reuters) – When a profitable
company is sitting on tens of billions of dollars in idle cash,
why can’t it automatically raise dividends to reward its
shareholders? After all, with savings yields at dismal levels -
and likely to remain so – those on fixed-incomes could use a
boost.

But companies won’t share the wealth, and the reason why
they won’t is an indictment of the U.S. government’s inaction on
corporate tax loopholes.

The problem in Washington: Corporations are offshoring more
than $2 trillion in corporate cash.

CHICAGO (Reuters) – Should you be “riding up” the bond yield curve to boost returns in your income portfolio?

While some investors may think that bonds are tame beasts, higher yields always translate into higher risks. There may be some interesting opportunities available to boost income, but you need to be careful. Longer-maturity corporate and Treasury bonds can still give you a rodeo-horse kick.

With the Federal Reserve expected to leave interest rates in the basement for the next two years or so, it’s only natural that you look outside of short-term Treasuries and insured deposits. Many investors have already moved from U.S. short-maturity bonds to longer-maturity issues in corporate, high-yield or corporate “junk bond” funds, according to data from Lipper, a Thomson Reuters company.

By John Wasik

(Reuters) – In an ideally-transparent world, you’d know as much about your broker as you know about the ingredients in packaged junk food label: All of the bad stuff would be instantly on display.

But in the U.S., some of the most important information about a broker is off limits to individual investors.

At present, you can do broker background checks through a web-based system run by the Financial Industry Regulatory Authority, the trade group that regulates the securities industry (FINRA), called BrokerCheck (brokercheck.finra.org).

March 5 (Reuters) – In an ideally-transparent world,
you’d know as much about your broker as you know about the
ingredients in packaged junk food label: All of the bad stuff
would be instantly on display in some kind of nutritional label.

But in the U.S., some of the most important information
about a broker is off limits to individual investors.

At present, you can do broker background checks through a
web-based system run by the Financial Industry Regulatory
Authority, the trade group that regulates the securities
industry (FINRA), called BrokerCheck ().
Or contact your state securities regulator. FINRA’s site
contains incomplete records, since it’s self-reported. And while
state regulators often have fuller reports, most investors will
probably not know that they are available, and those regulators
may not always be accessible nor may their reports be
user-friendly.

By John Wasik

(Reuters) – For many investors who have stayed away from the stock market for the past four years, this is a Hamlet moment. Returns look so tempting right now as stock indexes show their best performance since May 2008, with technology shares leading the way. To invest or not to invest?

Fortunately, you can take a Polonius approach to the market. He’s the father of Ophelia and Laertes who gets stabbed by Hamlet while spying on the vengeful prince of Denmark. Despite his bad timing, he has some great advice: “This above all: To thine own self be true.”

I’m reminded of Polonius’s speech by the notorious bear money manager Jeremy Grantham, who counsels long-term patience and resilience in a recent newsletter. While Grantham is bullish on “high-quality” (dividend-paying) stocks, oil, copper, forestry and farmland, I’m not suggesting you jump into anything before you do some serious self-analysis.

CHICAGO (Reuters) – Every time I hear the rumblings of a broad-based stock rally, a song from The Who echoes in my head: “Won’t Get Fooled Again.”

Well, I’m not going to tell you that this time it’s different, because it’s not. You just can’t predict where the market is going based on two out of 12 months. There are some awful nasty things swirling around out there – European sovereign debt, a dreadful U.S. housing market, oil price increases, Middle East tensions. If you have worry beads, they are probably worn to the nub.

Yet there are some signs that the stock market’s animal spirits are not just howling at the moon.

NEW YORK (Reuters) – My grandmother had a coffee can for spare silver coins. My Dad saved at his local post office in a savings account. Those were a sign of the times — the U.S. postal savings system was the first government-guaranteed savings vehicle, but it disappeared in 1967.

Now, we face a savings landscape that is so much more complicated than the one my grandmother and father faced. At present, there is no universal savings account with one set of rules.

Each year I bemoan the fact that I can’t consolidate the menagerie of retirement accounts I’ve opened and funded over the years. I have Roth individual retirement accounts, rollovers and 401(k) accounts that I’d love to merge, but can’t due to varying tax rules.