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Tag Archives: Vanguard Intermediate-Term Corporate Fund

August 2004 Issue

In this month’s visit, I’ll show you how to fatten your portfolio regardless of who wins. Hint: Both candidates will grapple with the same set of economic challenges in 2005, so you can make a tidy fortune if you understand what those are (and how they’re likely to be dealt with). We’re already preparing for the road ahead by pocketing profits of more than 90% on our small-cap stocks while shifting cash into bonds, high-yielding blue chip stocks and even a low-risk “hedge fund.”

THE FED SPEAKS, AND…

Yes, we got a little flurry of a rally in the stock market yesterday after the Federal Reserve lifted its target rate for short-term interbank loans a quarter point to 1.25% — the first official rate hike in four years. Traders seemed relieved that Greenspan & Co., in announcing the move, promised to act in “measured” fashion if further increases should prove necessary (as they almost surely will).

TOP IN STOCKS, BOTTOM IN BONDS

More evidence is gathering of an approaching seasonal top in the stock market. Yesterday’s sharp intraday reversal to the downside hands us another piece of the puzzle.

TURMOIL IN THE BOND PITS

Bond prices are gyrating wildly this morning as traders digest the government’s latest report on consumer prices. At first glance, the headline CPI number looks bad indeed: up 0.6% for the sharpest jump in three years. Moreover, the year-to-year inflation rate at the retail cash register soared in May to 3.1% — another three-year high.

Sell Target, Home Depot!

p>We got some great news out of the retail space last night. <bTarget Corp. (NYSE: TGT) will be selling its laggard Marshall Field’s unit, as well as some of its Mervyn’s stores, to May’s for $3.2 billion. It’s a wonderful price, well above what Wall Street had expected.