Mrs. Gatsby's portfolio

Oregon Senator Ron "Gatsby" Wyden has been in the news over the holidays. He announced that he's running for re-election in 2022. Wyden's 71 years old. He's been in Congress since he was 32. If he's re-elected, he'll be 73 when he's sworn in again. Forty years of overseeing the decline and fall of our country is not enough, apparently. 

Forgive me, but America needs a younger Senate, particularly on the blue side. Get some sprightly 60-year-olds in there, for Pete's sake. But who would run against Gatsby, in the primary or the general? For some reason, he's unbeatable. The local media kiss up to him, and to the local Democratic political minions, he's a god. 

It's a darn shame, if you ask me. Ron's 40 years amount to a large pile of very little.

But that's a post for another day. More than stewing about Old Ron, I've been thinking this week about his wife, Nancy Bass Wyden, who with their three children (ages 8, 13, and 13) lives in New York City. 

NBW owns the legendary Strand Bookstore in Manhattan. Unless you're Jeff Bezos, times in the retail business are hard. Ms. Wyden's relationship with her employees, always rocky, seems to be deteriorating further as she's imposed layoffs and other cuts to keep alive any hope of fully reopening and recovering.

The union recently called her out publicly for investing in stock of Amazon, which has been running independent bookstores out of business for years. Because she's married to a senator, NBW's personal stock trades are a matter of public record.

I thought of NBW again when I saw that Senator Elizabeth Warren thinks her congressional colleagues shouldn't be playing the stock market at all.

It’s time to ban Members of Congress & other senior officials from owning or trading any company stocks while in office. They can put their savings in conflict-free investments like mutual funds, or they can pick a different line of work. #EndCorruptionNow https://t.co/UsEPBo4v9k

— Elizabeth Warren (@SenWarren) December 29, 2020

Then a young guy on TikTok, backing Warren's point of view, used Ms. Wyden as an example of senatorial stock speculation. He suggested that it might be a smart trading strategy for the rest of us to copy which stocks she and those similarly situated were buying and selling on Wall Street.

@benbraveoak

#finance #investing #stocks #money #trading

♬ original sound - Ben Braveoak

With that, I couldn't resist. Over to the Senate Financial Disclosure website I went, to download and take a look at the stock market maneuverings of the Gatsbys. Now, there's a day of my life I'll never get back.

* * * * *

There are two main kinds of documents for each member of Congress over there. First you get an annual balance sheet of sorts, although the numbers are quite vague, and then there are statements for individual transactions. The balance sheets are kind of casual affairs; for example, the Wyden 2019 form didn't get filed until August 13 of 2020. But the transaction reports are hotter; they get filed every month.

In the Wydens' case, there are documents of both kinds, but Ron's recent finances are only on the balance sheet, because apparently he hasn't engaged in any transactions that need to be reported on a monthly form. And on that balance sheet, the assets of Ron and the kids take up only two pages, whereas NBW's holdings, which are more extensive, take up six pages.

As far as the stock market is concerned, things were pretty sleepy until the pandemic arrived. As of the start of 2020, Ron had a bunch of mutual fund accounts, and there were a couple of college savings accounts for the kids, also in mutual funds. (Two of the kids are shown as participants in "prepaid tuition" plans, which is interesting. I thought Oregon did not have such a plan.)

Meanwhile, over on the spouse's side, the most significant investments, as of the start of 2020, were not in publicly traded stocks and bonds. Instead, NBW owned stocks of two closely held corporations involved in bookselling, plus the building in which the Strand is located. She also owned interests in a parking garage in Columbus, Ohio; in apartments in Chicago and in Baton Rouge, Louisiana; and in an eyeglass frame company in California.

On the Wall Street front, she owned a fair amount of government bonds, including debt issued by the New York City subway system. As for equities, unlike her husband, she held individual stocks, but they were small potatoes as of a year ago: between $15,001 and $50,000 worth (each) of ExxonMobil, Intel, and Pfizer; and between $1001 and $15,000 worth (each) of Citigroup, General Electric, Johnson Controls, Medtronic, TE Connectivity, and Travelers. She had just one lowly mutual fund account, worth between $1001 and $15,000. In contrast, she had at least seven figures in Treasury bills, and at least seven figures in a money market account. 

In all of 2019, the couple apparently did not buy or sell a single stock worth more than $1000. And the same held true for the first quarter of 2020. But when the pandemic hit, that changed. NBW got into some serious stock trading.

Beginning on April 6, 2020, and through November 10, 2020, I count 194 stock transactions entered into by NBW or on behalf of the children. (The kids' deals are 16 of the 194.) Most of the action went down in the spring and summer. Most of it was buying stock, but there were some sales, too. Most of the transactions have been profitable, at least so far, but there were some clunkers as well. 

(Before getting into specifics, let me point out where I got my information. I took the transactions reported to the Senate, and tracked down stock prices, as of the dates listed in the Senate reports, via Yahoo Finance. There was a lot of keyboarding, and I apologize in advance for any transcription errors, which I'll correct when discovered. Also, I'm no securities analyst, and so don't take any of this as coming from an expert.)

The good

If you bought stocks between April and October, it would be hard to lose money from then until now. NBW did just fine, thank you. 

Her biggest play, and a big winner, was Nvidia, a Silicon Valley outfit that sells computer chips for gaming. NBW plunked down somewhere between $378K and $945K for Nvidia stock, with big buys in April, May, and June. On the buy dates, the shares were trading in the $267-$380 range. The year-end close was $522.20 per share. The kids bought a little in October, but they paid more than that.

NBW also bought between $325K and $750K of Apple, all over the summer. In June and July, she got in at between $88 and $100. The close for the year was $132.69. (She may have lost a little so far on a September 2 purchase. The high that day was almost $138, with a low of $127.)

She put between $225K and $600K into Microsoft, buying at between $193 and $211.13. The year-end close was $222.42.

Her infamous Amazon purchases were for between $220K and $600K, the vast majority coming between early April and early July. Prices on those buying days ranged from $1930 to $3060 a share. (She had two big buys in April, where the stock was really cheap: $1930 to $2400.) The stock closed the year at $3256.93.

Other big plays for the win were Disney (between $218K and $495K invested); UPS (between $230K and $500K invested); Facebook ($110K to $300K invested); Google ($112K to $300K); PayPal ($130K to $300K); and Vulcan Materials ($115K to $250K). 

On a smaller scale, NBW put between $30K and $100K into another enemy of bookstores, Costco. She bought at somewhere between $296 and $329. The year-end close was $376.78.

She got some more tech with KLA Corporation, investing between $90K and $300K at times when the stock price was between $132 and $207. The close at year-end was $258.91.

Ms. Wyden even had a piece ($16K to $65K invested) of Dunkin' Donuts, which she picked up in two purchases in April for between $42 and $56 per share. Dunkin' was sold later in the year, and the shareholders got more than $100 per share.

The bad

They can't all be winners, and the Wyden portfolio moves included a few stinkers. Probably NBW's worst play was Marriott International and a separate stock called Marriott Vacations. Starting with Marriott International, she moved between $115K and $250K into the stock in late May and early June, at purchase prices that were somewhere between $94 and $119 a share. She sold in early August, on a day when sale prices were between $81.30 and $84.19. Ouch. To make matters worse, if she hadn't bailed in August, she would have made money. The stock closed the year at $131.92.

Marriott Vacations, where she invested between $30K and $100K, was the same story. Bought at somewhere between $90 and $99, bailed at $82.52 to $84.84, and missing out on a year-end gain, with a closing price of $137.22.

In the same vein, NBW took a flyer ($65K to $200K) on TripAdvisor, buying in late May and early June at between $28 and $31.25 per share. She bailed in early July at between $18.41 and $19.20. The year-end close? $28.78.

Wayfair was another loser for her. She got in (investing $50K to $100K) at between $328 and $350 per share, bailing less than two weeks later at between $288 and $313. At least she avoided more losses through year-end, when it closed at $225.81.

And then there was Intel. As noted earlier, NBW owned some Intel when 2020 started. She bought some more ($15K to $50K worth) on June 17, at between $60.06 and $61.28. That was a mistake. When she bailed in early August, it was between $47.74 and  $48.63. The year-end close was a little better than that, $49.82.

The player

Some of the transaction listings suggest that NBW was starting to approach the stock market game with gusto. For example, on April 21, she bought between $15K and $50K of something called CrowdStrike at between $62.77 and $70.50. Three days later, she sold between $50K and $100K worth of CrowdStrike at between $68.89 and $74.65. That's probably a nice little short-swing profit. But if she had stayed in until year-end, she would have killed. CrowdStrike closed the year at $211.82.

There was a quick ride on Uber in May. Bought between $15K and $50K worth on the 8th, at between $31.64 and $33.30. Out on the 11th at between $31.41 and $32.38. Not a big winner, maybe a little loser. Year-end close: $51.

The honeymoon was brief with Kroger. Bought between $50K and $100K worth between August 4 and 19 (prices $34.90 to $36.89), out on the 24th (between $35.67 and $36.09). The end of the year was bad (close: $31.76), and so it was probably good that she bailed when she did.

* * * * *

One last thing I noted about the Wydens' financial statements is the couple's holdings in state and municipal government bonds. The senator owns such bonds issued in Oregon, while his wife owns such bonds issued in New York. This suggests to me that they're probably filing as residents of the two different states for tax purposes. Ron is probably filing as an Oregon resident, and Nancy as a New York resident.

As a tax person, it makes me wonder how they handle that on their state income tax returns (and for NBW, her New York City income tax return). They can file separate returns, even though they're married, but that's usually disadvantageous. If they file joint returns, I believe Oregon requires them to file a nonresident return, whereas it appears that New York State requires them to file a resident return.

Wouldn't it be something if Ron Wyden filed a resident tax return in New York and a nonresident tax return in Oregon?

Actually, no, it wouldn't. Nobody here cares. He can have that seat as long as he wants.