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  • Avoid Emotional Reactions, Declines Are Merely a Function of Normal Market Behavior [View article]
    And now we see tonight that Standard and Poors has downgraded the credit rating of the US, having seen that there is a sizeable faction in Congress that voted last Sunday in favor of defaulting on the national debt as a debating tactic, a faction that has some potential (although one hopes not) to increase its presence in future elections.
    Aug 5, 2011. 09:11 PM | Likes Like |Link to Comment
  • Avoid Emotional Reactions, Declines Are Merely a Function of Normal Market Behavior [View article]
    Actually I have no familiarity with Democratic Party talking points whatsoever.

    The fact that the United States would default on its debt if the debt ceiling was not raised was considered to be a fact by numerous commentators, economists, and not least politicians of other nations.

    No doubt the US could have avoided technical default for a while by shutting down whole tranches of government, not paying employees, failing to fund pensions, but such an outcome could have led to massive social and civil disruption.

    The fact is that to pass the final debt ceiling bill, the Republicans had to form a coalition with the Democrats to defeat the terrorists in their own midst and prevent a constitutional crisis.

    The most ludicrous part of all this was that after the event politicians were going on TV and claiming that all this showed that ¨our system works¨ when clearly it is close to collapse. This was similar to attorneys claiming the Casey Anthony case showed the system worked, while simultaneously the names of the jurors were kept secret for their protection!

    Is this therefore a surprise that large numbers of Americans responded to the debt ceiling crisis in the most prudent manner possible, removing their funds to whatever they believed to be the safest place available. Having seen the stock market collapse of 2000 and again in 2008, it is a case of twice bitten, thrice shy.

    (Any infringement of Democratic Party copyright in this post is purely accidental and coincidental. While I do believe that great minds think alike, it is indisputable that fools seldom differ. My idea are my own and not copied from someone else.)
    Aug 5, 2011. 04:08 PM | 3 Likes Like |Link to Comment
  • Avoid Emotional Reactions, Declines Are Merely a Function of Normal Market Behavior [View article]
    The fundamental concept of bringing US govt. spending and income into equilibrium is a sound one, but the manner in which the negotiations were conducted bringing the US close to a constitutional crisis and with the majority party in the House split with the larger faction only able to pass a bill by forming a coalition with Democrats to prevent a default by the US govt. has completely undermined the credibility of US democracy and casts severe doubt on its ability to manage its economy.

    The acrimony of the debate also raises the unpleasant specter that we could be entering a sixties-style era of civil unrest and assassinations. Right now the country is a tinderbox and the whole world can see it.

    No wonder everyone wants to go to cash.
    Aug 4, 2011. 07:41 PM | 5 Likes Like |Link to Comment
  • Stock Slide Resumes With Sharp Index Losses [View article]
    Agreed, at least from Florida. Call it a depression if you like.

    One simply cannot rely on official government propaganda or media reports. The aim is always to give an optimistic slant and to keep the investment funds flowing. The reporters on the main TV stations are too highly paid to put their jobs at risk by questioning the official line.

    Fortunately this correction or crash (we will see which it is as it unfolds) is neutral as far as my portfolio is concerned due to expecting something of the kind after the debt ceiling debacle exposed to the whole world that the lunatics are in charge of the asylum.

    However, if my portfolio was still invested in the ¨balanced¨ fund of the State of Florida Investment Option Pension Fund, I probably would have lost tens of thousands of dollars in my account over the last days, and I feel for those thousands of passengers who are still strapped in that boat.
    Aug 4, 2011. 06:31 PM | Likes Like |Link to Comment
  • Avoid Emotional Reactions, Declines Are Merely a Function of Normal Market Behavior [View article]
    ¨Over the years I've tried to really hit home on the fact market declines happen as a function of normal market behavior.¨

    I found the same thing working in the world of medicine. People die every day which is quite normal, and for medical professionals the main concern is that the next of kin don´t bother you during your lunch break with their irritating concerns.

    The problem with stuff like this in the world of investments is that it is not quite a level playing field between ordinary retail long side investors and the professionals whose positions are always hedged. Sure the pros might make a bit of a misjudgment on timing now and again, but it probably won´t cost them 25% of their net worth and take 10 years to recover.

    I was rather expecting this and had gone long on index puts when it became clear that many of the politicians in charge of the US economy were a bunch of terrrorists, proudly suicide voting in favor of crashing the whole economy in the hope of taking delivery of a container load of virgins in the political afterlife.

    The US really should have closed down international TV stations like CNN so that the world could not see what was going on, but now the cat is out of the bag, the whole world knows that the lunatics are in charge of the asylum, and goodness knows where it will all end.

    The only question now is when to pull out the stops and go long again. Fortunately the rich will get richer...

    I wanna be in that number
    When the rich go marching in
    Aug 4, 2011. 06:08 PM | 1 Like Like |Link to Comment
  • Tax Policy Center’s William Gale believes the debt deal - all spending cuts, no tax increases - effectively means that the burden of closing the gap will be placed on poor and middle-class households, rather than wealthy households. Without tax increases now or in the foreseeable future, the well-off won't be paying "anything close to their fair share of the fiscal burden."  [View news story]
    ¨All because our employees here, in every breakroom across America, have 200 square feet of mandatory wallpaper of rules, laws and regulations with 1 800 numbers on how to sue your boss and who to call to do so, whistle blower laws legislation...´´

    Hilarious and true! But couldn´t this have something to do with US culture and the way we do things?

    Germany has union involvement at board level in all companies above a certain size and is still making cars that people can afford to buy.

    There is something similarly blockheaded about the US´s bolting-the-stable-door approach to terrorism that involves treating all future airline passengers like terrorists.
    Aug 4, 2011. 09:18 AM | 1 Like Like |Link to Comment
  • The Similarities Between Portfolio Risk and Sex [View article]
    Certainly true that Wall Street is full of pimps.
    Aug 3, 2011. 09:32 AM | Likes Like |Link to Comment
  • Debt Deal Is a Blank Check [View article]
    And the best Supreme Court money can buy.
    Aug 3, 2011. 12:24 AM | 1 Like Like |Link to Comment
  • Debt Deal Is a Blank Check [View article]
    ´´I used to work for Coke. The CEO of the company, Robert Woodruff always said, "If it's not broken--let's fix it."

    I guess that was where New Coke made its appearance--changing a beloved and successful formula just for the sake of change.
    Aug 3, 2011. 12:21 AM | Likes Like |Link to Comment
  • Tax Policy Center’s William Gale believes the debt deal - all spending cuts, no tax increases - effectively means that the burden of closing the gap will be placed on poor and middle-class households, rather than wealthy households. Without tax increases now or in the foreseeable future, the well-off won't be paying "anything close to their fair share of the fiscal burden."  [View news story]
    Australia has a minimum wage of $13 per hour and everyone has to pay income taxes.
    Aug 2, 2011. 07:33 PM | Likes Like |Link to Comment
  • Record Low TIPS Yields Reveal Deep Pessimism [View article]
    I certainly agree with Tom, from what I saw of the debt ceiling debates on CNN Latin America, all the Republican policiticians interviewed were just rolling out the same old cliches about trainwrecks, shipwrecks, credit cards without any indication that their brains were in any way engaged in examining which of spending cuts and tax increases would really be the most stimulative on the economy and the job market and whether a blend of the two might not be both desirable and necessary.

    The one moment of high entertainment on TV was when Piers Morgan had Connie Mack Jr. of Florida completely harpooned and grinning inanely while totally unable to offer any plausible reason why he voted against Boehner´s Bill and essentially in favor of crashing the US economy.

    ´´By gradually reducing the share of the economy that is managed by the federal government over time, today's bill should result, eventually, in a modest increase in the economy's growth because the private sector will increase its control over the economy's scarce resources and that, in turn, will result in greater efficiency, productivity, and growth.¨

    Surely we do not want our scarce resources in the hands of unaccountable corporations who answer to no one? Look at the history of hardwood timbers for making furniture.

    Come on, Mr. Economist! You know better than this.
    Aug 2, 2011. 05:50 PM | 1 Like Like |Link to Comment
  • Why the Market Was Terrified Yesterday [View article]
    Well, there you go! But it is not just third world countries. In the UK the National Institute for Clinical Excellence (NICE) makes decisions on what drugs are cost effective and can be included in the National Formulary and used in the National Health Service. Naturally the decisions are sometimes controversial. Medicare and Medicaid and all the other government health services and insurance companies could do the same thing and save a bundle, and they can negotiate aggressively with the drug companies over prices.

    This stuff about carrying the cost of developing new drugs is a crock of shit. Basically what happens is that start up companies develop drugs and finance their costs by selling stock, paying huge stock options to their executives, and then when they successfully develop a drug they auction it to the major drug companies and everyone gets rich. See for example the new antidepressant Viibryd, developed by Clinical Data, Inc. which company was then sold to Forrest Pharma for a couple of billion. But really there is no need to spend a couple of billion to develop a new antidepressant that probably doesn´t offer any improvement over what is already available. The only difference is that when Forrest´s Lexapro goes out of patent the profits will nosedive until replaced by the expensive new drug with years of patent protection ahead.

    Malpractice suits? Certainly the whole area needs to be overhauled to bring it into line with what the nation can afford. This is exactly the kind of thing the Tea Party should be good at. They can just demand a Constitutional Amendment to the effect that damages for medical errors are limited to your money back.

    This would put a stop to ambulance chasing lawyers suing nursing homes and hospitals on behalf of greedy relatives every time a person dies of old age.
    Jul 29, 2011. 11:17 PM | Likes Like |Link to Comment
  • Why the Market Was Terrified Yesterday [View article]
    Why are posts disappearing? I wrote a reply to the above that I can see and read on my personal page list of posts, but I cannot see it here. Is anyone else having problems seeing posts on this article?
    Jul 29, 2011. 07:46 PM | Likes Like |Link to Comment
  • Why the Market Was Terrified Yesterday [View article]
    ´´I have to add that I'm stunned by comments from Tom and Rookie. As investors and traders we all know capitalism is messy, but capital goes where its treated best and that means growth. Nobody is excited about investing into what could become the next Western Europe style welfare state with permanent high unemployment! As investors we will follow the money and invest internationally or firms with an international footprint. But, as an American that breaks my heart! You both talk about re-regulating and more regulation.´´

    I don´t understand this at all. I´m not calling for more regulation.

    Look, we are agreed, our older people need health care, but we are paying way too much for it, especially the drugs. Did you know that Americans pay more for proprietary drugs than any other nation?

    I am in the Dominican Republic right now. I have a sore throat. I just went to the pharmacy and got some antibiotics and cough medicine from the pharmacist. I paid about $4. If I had been a Medicare patient in the US, I would have had to go to the doctor´s office, get chest xrays and blood tests, take the prescription to the pharmacy and pay through the nose for any medication prescribed. The total cost would have been 100´s of $.

    Let´s work together to figure out how to do it cheaper and provide cost effective health care.

    But just saying, let´s cut the budget first and then see what happens next is not responsible governance. We ARE an affluent people. We CAN afford to provide care to our diabetics and mentally ill, because we are a humane people and that is how we do things.

    Here in the Dominican Republic I know a teenage boy called Roberto. He is 15 and he has epileptic seizures. Here children go to school in two shifts, daytime and evening. He goes to evening school. In the day time he shines shoes for tourists, (only most wear sneakers), so that he can make a few pesos to buy Dilantin to control the seizures which will destroy his brain if not controlled. Is this what the Tea Party wants for American? I doubt it, but why does it not spell out its vision for America?

    Smaller government, yes, but the real question is how do we do more with less?
    Jul 29, 2011. 02:03 PM | 1 Like Like |Link to Comment
  • Is Whitney Tilson Smarter Than These Great Investors? [View article]
    Yawn. And you haven´t answered my question about how heavily invested you are in Interoil. Also, are you being remunerated to promote Interoil, or are you purely retail investors?

    Talking of due diligence, also see this

    thestreetsweeper.org/a...
    Jul 29, 2011. 12:02 PM | Likes Like |Link to Comment
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