Author Topic: A Short Term Capital Gains Hand Picked Stocks Thread  (Read 7030 times)

Freeyourchains2

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A Short Term Capital Gains Hand Picked Stocks Thread
« on: June 19, 2013, 11:31:46 AM »
A thread for Short Term Capital Gains Hand Picked Stocks talk and stories.

Full assumption: Assume All investments are within a non-taxable account to please this community and MMM's Global Moderators.

Full Disclaimer: I, the Original Poster, am not a licensed investment advisor. I am not an investment professional. This thread should be viewed for educational or entertainment purposes only. I am not liable for any losses suffered by any parties. Unless your investments are FDIC insured, they may decline in value. Invest at your own financial risk.


With all that being said,

Anyone else take 1-5% of their total Stache and take a risk? Then strategize for maximizing their short term profits?

Buying low, selling high seems to work a lot on anything from nano-cap to large cap companies with all different types of industries and business models.

Keeping emotions out of it helps a lot too, especially if you can "afford to lose" what you invest. (usually helps if you have reached your goals of financial independence, have a nice cushion already and make extra hobby/business cash.)

If you have the time to occasionally watch and play with the stock market,

10%+ returns can be made monthly on lower investment limits, like $2k-$20k positions. It gets trickier for the extreme wealthy to find big market cap investments (like Warren Buffet).

Hotter stocks are the most volatile. "Wild" speculations with decent research can net you a lot of gains.

When consumers become loyal and love to buy the newest products and services, earnings rise tremendously for that company.

Stories? Tips? Rewarding Risks?



« Last Edit: June 19, 2013, 11:38:26 AM by Freeyourchains2 »

Joet

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Re: A Short Term Capital Gains Hand Picked Stocks Thread
« Reply #1 on: June 19, 2013, 11:34:34 AM »
For gambling I prefer Vegas or the track or sports betting or card games with friends. For investing I prefer indexing.

George_PA

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Re: A Short Term Capital Gains Hand Picked Stocks Thread
« Reply #2 on: June 19, 2013, 12:23:19 PM »
Your question seems confusing because said that we are talking about a non-taxable account meaning 401k retirement type money;

Most retirement plans don't let you just trade in and out of investments (although I am sure you can do it if look hard enough to find a way).  For these funds, the total investment term is so long term (i.e. 30-40 years), that a simple yearly rebalancing is probably all you need.

Now, if change the assumption to mean taxable accounts, i.e. using a brokerage account to buy and sell stocks or ETFs then it would make sense.  This is usual the way people would do what you are talking about.

Freeyourchains2

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Re: A Short Term Capital Gains Hand Picked Stocks Thread
« Reply #3 on: June 19, 2013, 12:38:09 PM »
@Joet:
But not all of us like going to casinos or tracks to bet when the internet is right there at our disposal in our houses, hotels, beach bungaloos, European Hostels, tents, etc..
Plus some like picking our own bets, least spreading your chips across the entire roulette table and then getting fee'd for the labor of spreading your chips around and they control where some stacks are higher then others..

However, i do like the 70% reward, with 1% effort ratio too a bit, but the reward seems very small because of the over diversified approach, in my opinion.

Like getting a 1-4% return from a mixture of 500 companies. That $20 from $2k is great and all.
But taking a little more action, practicing your strategy a bit more till you get great at it, and you can make $200 from $2k in a month, then almost consistently as your skills increase.

@ George_PA: Just think of it like Rolling over your 401k of $20k into an IRA for the first time or yearly.
Now you get to trade freely and make trades as many times as you desire (minus any commission/trading fees, etc) and don't have to report any of it to the IRS, and any earnings are locked up until you are age 59.5.

(Or you can think of it like a taxable account to simplify it, if you wish )


Joet

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Re: A Short Term Capital Gains Hand Picked Stocks Thread
« Reply #4 on: June 19, 2013, 12:44:46 PM »
yea I hear you on the basement-internet-gambling while hooked up to a bag of chips and a beer fridge. Different strokes. Human interaction for me please :)

Quote
But taking a little more action, practicing your strategy a bit more till you get great at it, and you can make $200 from $2k in a month, then almost consistently as your skills increase.
Really? 'Skill' isn't the word I would choose...

tooqk4u22

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Re: A Short Term Capital Gains Hand Picked Stocks Thread
« Reply #5 on: June 19, 2013, 01:01:22 PM »
I to invest in individual stocks and have had many short term gains, but most were by accident and not design as I buy for long term not to trade.  Typically it is for one of two reasons
1.  the stock shoots up considerably in a short time for no real reason (think no news, up 20% in a month, and market didn't really move) so I sell and reap the gain.  I will buy them back on a dip 30 days+ later to avoid wash sale.
2.  tax basis management.  Index funds are great for this especially - have a gain in a stock there is almost always some loss imbedded in my ETFs so lets say I have home depot with a $1000 gain and a tax lot of VOO (Vanguard 500 ETF) with a $1000 loss - I will sell both then immediately buy VTI or SPY to avoid wash sale and keep my money in the market but still minimizing taxes.  And typically stocks prices don't move drmatically in 30 days so I buy it back.

arebelspy

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Re: A Short Term Capital Gains Hand Picked Stocks Thread
« Reply #6 on: June 19, 2013, 01:08:32 PM »
Anyone else take 1-5% of their total Stache and take a risk? Then strategize for maximizing their short term profits?

What happens when you lose that?

My guess: you take another 1-5%, lather, rinse, repeat...

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Freeyourchains2

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Re: A Short Term Capital Gains Hand Picked Stocks Thread
« Reply #7 on: June 19, 2013, 01:31:26 PM »
Anyone else take 1-5% of their total Stache and take a risk? Then strategize for maximizing their short term profits?

What happens when you lose that?

My guess: you take another 1-5%, lather, rinse, repeat...

Well if you bought a company like Tesla Motors at $90/share... it would have to go bankrupt and fire 2,964 employees....for your 1% ($2k position to be worth $0).

On the other hand if you are emotionless, and "wildly speculate" it will go up 10% sometime over the next month, a week later it may drop to $83, but then a week later after that it's at.. oh look it's at $100/share. Ok, I sell.

$200 for me, yeah! 10% return in a month, yeah! Plus the company has created more jobs over that quarter with more quarterly earnings as you noted from a little research/effort.




TLV

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Re: A Short Term Capital Gains Hand Picked Stocks Thread
« Reply #8 on: June 19, 2013, 01:56:08 PM »
1.  the stock shoots up considerably in a short time for no real reason (think no news, up 20% in a month, and market didn't really move) so I sell and reap the gain.  I will buy them back on a dip 30 days+ later to avoid wash sale.

According to the IRS, wash sale rules only apply if you sell for a loss. So you don't have to wait 30 days to repurchase if the dip happens sooner!

The idea behind the wash sale rules is prevent you from taking the tax deduction for a loss.

Edit: This post is not to say that I support doing this, but if you do, you ought to know the tax consequences.
« Last Edit: June 19, 2013, 01:59:03 PM by TLV »

arebelspy

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Re: A Short Term Capital Gains Hand Picked Stocks Thread
« Reply #9 on: June 19, 2013, 01:58:43 PM »
Anyone else take 1-5% of their total Stache and take a risk? Then strategize for maximizing their short term profits?

What happens when you lose that?

My guess: you take another 1-5%, lather, rinse, repeat...

Well if you bought a company like Tesla Motors at $90/share... it would have to go bankrupt and fire 2,964 employees....for your 1% ($2k position to be worth $0).

On the other hand if you are emotionless, and "wildly speculate" it will go up 10% sometime over the next month, a week later it may drop to $83, but then a week later after that it's at.. oh look it's at $100/share. Ok, I sell.

$200 for me, yeah! 10% return in a month, yeah! Plus the company has created more jobs over that quarter with more quarterly earnings as you noted from a little research/effort.

I asked about what happens if you lose, and you give me a scenario where it goes up and you make money?

Hmmm...
We are two former teachers who accumulated a bunch of real estate, retired at 29, spent some time traveling the world full time and are now settled with three kids.
If you want to know more about us, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
We (rarely) blog at AdventuringAlong.com. Check out our Now page to see what we're up to currently.

Joet

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Re: A Short Term Capital Gains Hand Picked Stocks Thread
« Reply #10 on: June 19, 2013, 02:15:20 PM »
Well all I ask of the 'stock pickers', 'market timers', option-players, spread-traders, etc all is an honest accounting of their supposed 'gains' vs relevant market indexes.

agree to review every few years. Who knows: you may be the next Warren Buffet. Kudos and good luck. I also believe one of the things that helps indexers succeed is a healthy # of retail investors buying high and selling low :)
« Last Edit: June 19, 2013, 03:05:23 PM by Joet »

tooqk4u22

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Re: A Short Term Capital Gains Hand Picked Stocks Thread
« Reply #11 on: June 19, 2013, 02:29:20 PM »
1.  the stock shoots up considerably in a short time for no real reason (think no news, up 20% in a month, and market didn't really move) so I sell and reap the gain.  I will buy them back on a dip 30 days+ later to avoid wash sale.

According to the IRS, wash sale rules only apply if you sell for a loss. So you don't have to wait 30 days to repurchase if the dip happens sooner!

The idea behind the wash sale rules is prevent you from taking the tax deduction for a loss.

Edit: This post is not to say that I support doing this, but if you do, you ought to know the tax consequences.

Your right on part of it, but the other part is if you sell it then immediately buy it back and then sell it for a loss 30 days or more later then the wash sale still applies.  I want to avoid this, mostly for tracking reasons but also because of future tax management. 

TLV

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Re: A Short Term Capital Gains Hand Picked Stocks Thread
« Reply #12 on: June 19, 2013, 03:19:37 PM »
Your right on part of it, but the other part is if you sell it then immediately buy it back and then sell it for a loss 30 days or more later then the wash sale still applies.  I want to avoid this, mostly for tracking reasons but also because of future tax management. 

I'm afraid I don't follow. According to the document I linked, it's only a wash sale if the sale that incurs the loss is within 30 days of buying shares of the same stock. Where are you getting that a gain now can lead to a wash sale more than 30 days down the road?

So in your scenario, you sell home depot for a gain, sell VTI for a loss to offset the gain, immediately buy SPY to get the VTI funds back in the market without a wash sale. Then, you wait for 30 days to rebuy home depot, to avoid a wash sale. But since the home depot sale was for a gain, you should be able to rebuy it immediately. You'd only have a wash sale if you sold the home depot for a loss within 30 days of rebuying it - not way down the road. If you have a source that says otherwise, could you link it?

George_PA

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Re: A Short Term Capital Gains Hand Picked Stocks Thread
« Reply #13 on: June 19, 2013, 10:19:06 PM »
Freeyouchains2 ok if I assume you are investing taxable accounts instead, then it starts to make sense.  Based on personal experience, this strategy does work well for me, however everyone else says that they lose money.   

So maybe it works or maybe I have just been lucky and that my time is coming when I will get socked with huge losses and then the hardcore Vanguard, Bogel index-only crowd will laugh in my face.  I have noticed that they are an aggressive group and don't tolerate other opinions on investing very much.  They will probably show up at my house as a mob and give me a beat down and smear "A Random Walk down Wallstreet" in my face.

Since its your money, you can do whatever you want with it just beware that you are at risk of losing money.




« Last Edit: June 19, 2013, 10:23:20 PM by George_PA »

matchewed

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Re: A Short Term Capital Gains Hand Picked Stocks Thread
« Reply #14 on: June 20, 2013, 05:11:33 AM »
Freeyouchains2 ok if I assume you are investing taxable accounts instead, then it starts to make sense.  Based on personal experience, this strategy does work well for me, however everyone else says that they lose money.   

So maybe it works or maybe I have just been lucky and that my time is coming when I will get socked with huge losses and then the hardcore Vanguard, Bogel index-only crowd will laugh in my face.  I have noticed that they are an aggressive group and don't tolerate other opinions on investing very much.  They will probably show up at my house as a mob and give me a beat down and smear "A Random Walk down Wallstreet" in my face.

Since its your money, you can do whatever you want with it just beware that you are at risk of losing money.

There you go again with making it into personal attacks instead of discussing the ideas. I have no actual sway in whether you continue to do so or not, but please bring something to the table other than people being pro index fund investment are aggressive and intolerant the next time you post. It will make it a much more enjoyable discussion for all of us if we can get beyond "you're a poopy face."

smedleyb

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Re: A Short Term Capital Gains Hand Picked Stocks Thread
« Reply #15 on: June 20, 2013, 06:48:54 AM »
Yeah George, keep it classy like Joet. 

Freeyourchains2

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Re: A Short Term Capital Gains Hand Picked Stocks Thread
« Reply #16 on: June 20, 2013, 07:32:21 AM »
Anyone else take 1-5% of their total Stache and take a risk? Then strategize for maximizing their short term profits?

What happens when you lose that?

My guess: you take another 1-5%, lather, rinse, repeat...

Well if you bought a company like Tesla Motors at $90/share... it would have to go bankrupt and fire 2,964 employees....for your 1% ($2k position to be worth $0).

On the other hand if you are emotionless, and "wildly speculate" it will go up 10% sometime over the next month, a week later it may drop to $83, but then a week later after that it's at.. oh look it's at $100/share. Ok, I sell.

$200 for me, yeah! 10% return in a month, yeah! Plus the company has created more jobs over that quarter with more quarterly earnings as you noted from a little research/effort.

I asked about what happens if you lose, and you give me a scenario where it goes up and you make money?

Hmmm...

You only lose if you sell below your initial cost basis or the company goes completely bankrupt which doesn't ever happen over night and has many many red signs.

If you research for undervalued high quality companies with room to grow, or you think for x, y, z reasons they are growing, then take a risk, and your pay off can be rewarding.

Sense 99.45% of the consumer world "wants" a gas engine car still, and car's currently still run on Exported foreign Oil. I speculate that Exxon Mobil will continue to grow their earnings. Though electric motor wheels will make electric cars more affordable will be a game changer for the Auto Industry, in my opinion.

Sense every consumer loves Marvel Studios movies, the Star Wars Universe, and has been to Disney World and stayed at one of their resorts, I speculate that Disney will continue to grow their earnings. Plus not to mention that the late Walt Disney was a business genius.

Disclaimer: I am long on Exxon Mobil and Disney.


matchewed

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Re: A Short Term Capital Gains Hand Picked Stocks Thread
« Reply #17 on: June 20, 2013, 07:43:02 AM »
But right there you're mentioning speculation and valuation. The hard thing for me to swallow personally is that you provide a great amount of speculative reasons and mention valuation analysis but then do not actually provide any evidence of valuation.

What are the signs of undervalued companies? What are the red signs of a company tanking? And moreover why should I take the risk of investing in one particular rat in this race when I can bet on the group as a whole?

Freeyourchains2

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Re: A Short Term Capital Gains Hand Picked Stocks Thread
« Reply #18 on: June 20, 2013, 08:35:59 AM »
Freeyouchains2 ok if I assume you are investing taxable accounts instead, then it starts to make sense.  Based on personal experience, this strategy does work well for me, however everyone else says that they lose money.   

So maybe it works or maybe I have just been lucky and that my time is coming when I will get socked with huge losses and then the hardcore Vanguard, Bogel index-only crowd will laugh in my face.  I have noticed that they are an aggressive group and don't tolerate other opinions on investing very much.  They will probably show up at my house as a mob and give me a beat down and smear "A Random Walk down Wallstreet" in my face.

Since its your money, you can do whatever you want with it just beware that you are at risk of losing money.

You are a very insightful person! And are open minded, and know you can always control your money and your life as long as you don't fear. Fear keeps the other's in the dark cave watching the shadow puppets entertain them on the walls, as they don't noticed they are shackled with chains to the ground until someone punches them in the face!

Tooo many people fear losing their job, then they "give up" when it happens like they have no other options of finding money/hour or purpose for life, and/or like it was 100% their fault, though the CEO just needed to increase this quarter's earnings quickly.

Tooo many people fear losing their money, then they "give up" when it happens like they can never make money again.

Tooo many people fear being bored in retirement/Financial Independence, thus they imprison themselves in a cubicle, truck seat, boat on the seas, for 9 hours a day or much more until they die, which is a torturous way to live, if they don't get happiness from their jobs that is (1%).

Thus too many people fear creating things from scratch or growing things or investing in things, or taking some risk on planting a tree in a decent location and trying new strategies; because they have been told all their lives to spend money, work hard for others, pay your taxes without question, or follow what the government orders you to do without question. Sometimes you take government incentives thinking it's best for you, like $20,000 sign on bonuses for Marine Corp front line of the battlefield. If you die they collect death taxes on all your assets, shrug their shoulders, and carry on without you. There are other examples of this i won't go into.

Those that are paid "experts" on trading, usually trade with chains of "being fired" if they don't make a quota from the floor man up to the CEO position. They are under the Company's or Investors of the Company's chains and will.

My point is, 90% of investors don't try to invest in short term trading because they fear losing money and because the Government, currently, taxes their success (if not in an IRA), almost as if they know you will succeed big time and they must limit your success with more taxes and more policies, least you become greater than the government in your efforts.


[MMM and Jacob at http://www.earlyretirementextreme.com/ are great at saving lives of people who aren't really living, especially at work; and those same people usually need a goal to escape the working/taxed/spending system, that the government and greedy depend on for survival!]

@ matchewed. A great financial blogger to follow on business valuation analysis is Dividend Mantra at http://www.dividendmantra.com/ plus in some of the posts by Jacob at ERE. Jacob's book is very inspiration to anyone interested the power of FI and how to get there extremely early. And he is planning on writing an investing guide book after his fun chosen job opportunity as a quantitative analyst to broaden his knowledge of investing, because he doesn't need the cash to live.

FI bloggers like MMM have their own investing strategies and diversifications. As we all do. I am just suggesting 1-5% of your stache invested in the stock markets short term strategies and/or in your own businesses, may help to increase your stache greatly, as well as your market investing and business skills.
« Last Edit: June 20, 2013, 08:41:37 AM by Freeyourchains2 »

aclarridge

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Re: A Short Term Capital Gains Hand Picked Stocks Thread
« Reply #19 on: June 20, 2013, 10:04:31 AM »
For what it's worth, before I was completely sold on index investing, I did some trading with individual stocks. In all I had a pretty good record with them I think, although I didn't track my performance very well. I know I never sold at a loss with the exception of one stock which went to 0 and got delisted (I still never sold it, it just kind of disappeared from my statement after a while). Other gains more than made up for it, and I think my annualized return over the year or two I was doing this was >10%.

I had to wait out some really big declines though and over time I realized I had no idea where prices were going in the short term, and no guarantee that any individual company wouldn't go to 0. It's just gambling - odds are in your favour if you are patient and diversify a bit, since businesses do tend to make money more often than lose it, but still very possible to ruin yourself by really bad luck.

I am just suggesting 1-5% of your stache invested in the stock markets short term strategies and/or in your own businesses, may help to increase your stache greatly, as well as your market investing and business skills.

Investing in your own business is different, but I think the only way it's a good idea for a non-expert (i.e. not working full-time on your strategies using the best data services) to invest in "stock markets short term strategies" at all is if you enjoy it or get pleasure from it. Then you can at least justify it as entertainment. Otherwise, over time, you'll lose to institutional guys who are doing it full-time with the best resources.
Do you do a bottom-up fundamental analysis of all the stocks you invest in using recent financial statements and various models? Do you physically visit every company you invest in and do a thorough due diligence? Do you have a comprehensive view of all the macroeconomic factors that may be affecting the stock price, and the attention to monitor all this data and react to it any time the markets are open? This is what you're up against. There are enough players working harder at it than you are that it's hard to believe you can beat them over time. So what's the point, as an investment?

arebelspy

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Re: A Short Term Capital Gains Hand Picked Stocks Thread
« Reply #20 on: June 20, 2013, 10:33:48 AM »
I asked about what happens if you lose, and you give me a scenario where it goes up and you make money?

Hmmm...

You only lose if you sell below your initial cost basis or the company goes completely bankrupt which doesn't ever happen over night and has many many red signs.

Right, and when those red signs come up, what do you do?  ...sell below your initial cost basis, losing money.

You're telling me it's literally impossible to lose money, besides in the rare bankruptcy case?

How long do you have to hold for that to be true?

What is your exit strategy if the stock does go down?

You basically seem to be saying if you do your research, it goes up every time, and if it doesn't, it only temporarily goes down, then goes back up, so you just need to hold a bit and wait.

This sounds like the words of someone speaking in 2000 who have been investing for 2 years... or someone in 2013 who has been investing for 3 years...
We are two former teachers who accumulated a bunch of real estate, retired at 29, spent some time traveling the world full time and are now settled with three kids.
If you want to know more about us, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
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George_PA

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Re: A Short Term Capital Gains Hand Picked Stocks Thread
« Reply #21 on: June 20, 2013, 10:40:02 PM »
@matchewed; sorry to offend you again; its seems you are sensitive; I will try to watch myself if you're in the discussion; I will tone in down a notch.

its true though, the vanguard indexers have no tolerance for "short term trading", or "timing the market". 

I am only stating how a lot of them actually act;

I would not have a problem with them if they just just stayed silent and did things their own way; They could just go about their business in peace and respect that others have different opinions about investing, but no, sigh ... that would be too easy for them. 

Instead they feel it is their evangelical mission in life to spread "the message" about index investing.  They just seem to go out of their way to criticize anyone who does not have the "index all the way" attitude when it comes to investing.  It is this annoying aggressive behavior they seem to constantly exhibit that makes me want to just give them a punch in the face.


« Last Edit: June 20, 2013, 10:42:39 PM by George_PA »

matchewed

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Re: A Short Term Capital Gains Hand Picked Stocks Thread
« Reply #22 on: June 21, 2013, 04:43:43 AM »
I'm more than open to ideas and strategies that are backed up by data. This goes for many things in life. What also goes for many things in life is that not everyone will agree with you and will want to discuss those differences with you.

There is a distinct difference between the next two comments - timing the market is like gambling and people who practice market timing are no better than gamblers.

And frankly I refuse to stay silent about my opinion. Just because you don't like it doesn't mean I have to stay silent. You can invest in any manner you want, if my the mere statement of opinion on investing strategies is so enraging then perhaps participating in discussions about them on this board which has a large proportion of people supporting index investing as a proven superior method may get you feeling a bit of anger. Since you realize it makes you angry perhaps you could try focusing that anger on the topic being discussed and not the people discussing it. Attack the ideas all you want. Try to leave the people out of it. It makes for better discussions.