What Did You Buy Today?

[Otter]

(04-12-2019, 01:58 PM)vbin Wrote:

(04-12-2019, 01:56 PM)Otter Wrote:

(04-12-2019, 01:29 PM)vbin Wrote: Can you please share more data/links on investment in large defence contractors?

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Have held BA since it was $120/share, and been very happy with the dividend raises since that time. I currently think it is overpriced, but will just continue to hold. 

Opened a position in LMT during the December mini-panic when it was under $270/share, and anticipate that it will continue to churn out reliable income as it has for decades. Have had my eye on it for a long time, and it finally got in my buy range in December.

Have recently been nibbling on GD. Not super-discounted, but appears fairly priced at the moment with a 15 P/E. 

LDOS is on my watchlist. Would have loved to grab some in December, but LMT got the nod with those funds. Waiting for the next downturn on that one. They basically do IT for our three-letter agencies.

Thank you, I was looking for data on "Megabanks these days are like investing in large defense contractors. They aren't going anywhere, and they are cash machines"

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I was just drawing an offhand analogy. Large Defense contractors like Boeing and Lockheed are essentially the military industrial complex that Eisenhower warned about. Today, they are so large and integrated into the fabric of our economy that their failure would be catastrophic. The U.S. military and all of the associated defense contractors that supply it are the largest jobs program on Earth. Politicians cut it at their peril. Left-leaning politicians may moan about the "cost" of the military to appease the activist base, but in office they tend to keep the money flowing. Military/contractor projects are located in just about every domestic political jurisdiction on purpose. Local Congressmen/Senators support the jobs and money that come with those projects. 

Likewise, the major banks these days are critical to the functioning of the American financial system. Too-big-to-fail is real. 2008 would look like a minor speed-bump if any of C, BAC, JPM, or WFC collapsed. There's a reason Buffet is invested in WFC. The megabank sector is an oligopoly, and there is essentially an insurmountable barrier to entry. WFC may be unpopular for a while, but this too shall pass, and the money will keep flowing. If it doesn't, we all have much larger problems on our hands.