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  • What Would Happen To Investment Banks In A Crisis? [View article]
    They simply need to cut back on overpaying their employees, and allowing the executives to plunder the company, so they can save for a rainy day. 4% is nowhere near enough.
    Mar 17 01:32 PM | 6 Likes Like |Link to Comment
  • Retire When You Can Afford To [View article]
    There is probably no ideal age for retirement, and never was, and human history continues to develop and change with the passage of time. However workers over the age of 60 become increasingly less physically capable and in some cases less mentally capable as time goes by, and given high levels of unemployment it is desirable that they should yield and allow younger workers to take their places in the workforce.

    Probably people in higher professions like doctors, lawyers, bankers, engineers, business executives and owners are more likely to be able to continue working to an older age, because their professions mostly require knowledge, experience, and judgment and rely less on being on one's feet for many hours, but people in these groups are the least likely to need to keep on working to make enough money to retire.

    It was recently brought to my attention by a reliable source that incomes in the US are so skewed by high earners that the income of the bottom 80% of households averages only $24,000. Regardless of the absolute accuracy of this number, it seems terribly unlikely that a very large percentage of the working population is in a position to continue working beyond 65.
    Mar 11 11:22 AM | 6 Likes Like |Link to Comment
  • Turning Negative On Nokia [View article]
    It's funny. Because everyone has a cell phone and nearly everyone on Seeking Alpha has a smart phone, everyone considers themselves to be experts on the subject of the cell phone industry and its stocks, based mostly on their own experience of using a cell phone. It is a vast and complex industry and it is immeasurably difficult to know how phones will be marketed and what people will want to buy in countries very different from one's own. Most likely it will eventually develop like automobiles, with a variety of different makes, all similar, but all slightly different and holding different market niches.
    Mar 1 03:45 PM | 6 Likes Like |Link to Comment
  • The Retirement Bubble [View article]
    "When someone tries to sell me something, and they have a stake in my buying it (e.g. they get a commission), then it should be clear to absolutely everyone that this is not an objective "recommendation". "

    Yes, but you are a professor and obviously somewhat investment literate. What about people who just arrived in the US a couple of years ago? These professionals in the real estate industry are supposedly licensed by the state, so one might assume that they have a duty of care, just as a doctor does.
    Oct 10 09:32 AM | 6 Likes Like |Link to Comment
  • Berkshire Hathaway's New Share Repurchase Program - And What It Means [View article]
    Old Warren Buffett
    Sat on a tuffet
    Just tossing his riches away
    Along came a SPDR
    And per an insider
    Said "Why not stuff it in BRK 'A'?"
    Sep 26 08:59 PM | 6 Likes Like |Link to Comment
  • The Telegraph reports German and French officials working on a multitrillion-dollar "firebreak." Among the steps is a bank recapitalization going well beyond the laughable €2.5B tagged by the EU stress tests (the IMF puts the figure at €200B, others say €1T). A bump in EFSF firepower to €2T and a "controlled" Greek default giving a 50% haircut to lenders are also in the mix.  [View news story]
    "The bureaucrats salaries and benefits should be slashed by at least 25% and their pensions arbitrarily reworked to provide nothing more than basic social security like returns."

    In fact they should be put in concentration camps when they are too old to work and given a basic diet and a daily vitamin pill. If they become sick, they should be euthanized and their corpses sold to pet food manufacturers to defray the cost. The camps could be run by private corporations without unions or pensions, and any employee who failed to perform could be sent into mandatory retirement. If we all work together, this dream can come true.
    Sep 24 07:48 PM | 6 Likes Like |Link to Comment
  • The Telegraph reports German and French officials working on a multitrillion-dollar "firebreak." Among the steps is a bank recapitalization going well beyond the laughable €2.5B tagged by the EU stress tests (the IMF puts the figure at €200B, others say €1T). A bump in EFSF firepower to €2T and a "controlled" Greek default giving a 50% haircut to lenders are also in the mix.  [View news story]
    "As a former Citibank employee who sat enthralled while Walter Wriston spoke to a group of us on the importance of the repeal of Glass–Steagall Act and who saw that repeal take place seventeen years later, I can only hang my head in shame at having bought the thesis way back then."

    Why should you? Back in those days banking was regarded as an honorable, profession like medicine or law. Bankers were respected and no one knew how they would irresponsibly abuse the freedoms they were granted.
    Sep 24 07:35 PM | 6 Likes Like |Link to Comment
  • S&P Downgrades U.S. to AA+ - We're Tied With Belgium! [View article]
    ´´Who voted for default?

    The tea party Republicans voted to live within our means. They voted for 41% spending cuts and balancing the budget this year.´´

    In the final House vote on the Sunday many Republicans voted against the bipartisan bill. Had their vote carried, the US would have defaulted, so they were effectively voting for default.
    Aug 6 10:49 AM | 6 Likes Like |Link to Comment
  • Why I Don't Watch CNBC [View article]
    I personally do not watch CNBC nor do I watch any TV at all when I am at home, and haven´t done so for several years.

    However, right now I am staying in a rented condo where there is satellite TV and have been watching CNN, CNN Latin America, BBC World News, Al Jazeera every now and again. RIght now the TV is off, because I have had enough.

    I think the danger of watching CNBC or ANY TV on a regular basis is that you get overwhelmed with short term data presented with a lack of long term perspective, and ultimately this may skew your thinking.

    The other factor is that if a TV station carries commercials, then the commercials are the true message, and the content is incidental or it is skewed towards delivering an audience to the advertiser. Without tuning in to CNBC, I can confidently predict that it is not telling the true story about how NewsCorp has been run for years as a criminal organization and its executives may face prosecution under US antibribery statutes for paying bribes to British police officers.
    Jul 10 12:45 PM | 6 Likes Like |Link to Comment
  • Just How Sick Is This Market? [View article]
    "Obama will do all he can to keep unemployment and poor people at high levels since they are his strongest voting block. Bizarre isn't it, that the president who makes you poor and keeps you poor receives your vote... There seems to be little reason for optimism for an economic recovery when the dems control govt and do not want a recovery. "

    Personally I am not terribly happy with Obama, but remember that he did warn against the Iraq War and its incredible cost at a time when there was hardly any politician prepared to speak out against that war. I don't know if you know about the story of the Emperor's New Clothes, but Obama was the little boy who called out the truth, and that is why he grew up to be President.

    The economic crisis came to a climax precisely at the end of 8 years of a Republican administration under Bush the Younger, a weak leader who know very little about the wider world, and did not have enough sense to appoint competent and worldly people to advise him. Obama was left to pick up the pieces of a broken economy. I don't know what he could have done different, but then I am not an economist.

    So we have a center right president who has not fulfilled his promises to get out of the debacle in Iraq and Afghanistan or to achieve a decent reform of the health care system comparable to all the other developed economies and whose greatest achievement so far has been killing an unarmed man and dumping his body in the ocean. If you were to compare US presidents to Roman emperors, Bush would be Nero, fiddling while American collapsed, and Obama his close relative Caligula.

    Obama was not elected by the poor, because for the most part the poor do not vote, although I will concede you that he probably won a majority of the elderly vote and of course he carried his core constituency of African Americans.

    I don't know why you think the Democrats don't want an economic recovery. Obama is the grandson of a successful banker and seems to be very well disposed toward Wall St. Most, if not all, of the Democratic Party legislators are wealthy business people who have a lot of money in investments. Their election campaigns are financed by wealthy individuals and corporations. If there are any lobbyists for the poor on Capitol Hill, they are vastly outnumbered by lobbyists for large corporations.
    Jun 18 01:01 PM | 6 Likes Like |Link to Comment
  • Is Pandora Worth $2 Billion? [View article]
    If Pandora is worth $2 billion, then BBC online radio is worth about a $1 trillion billion.
    Jun 14 11:56 PM | 6 Likes Like |Link to Comment
  • Why Smart Investors Should Buy Apple and Google, Sell Research In Motion and Nokia [View article]
    "Apple sells the iPhone for an average of $638 each..."

    So maybe there is a lack of confidence that Apple can continue to sell a phone that probably costs less than $30 to manufacture for these kind of prices in a declining world economy. That is a lot of money to pay for something that will probably be bricked if you drop it in the toilet. Also the battery is difficult to change and beyond the capacity of most users.

    The cash is a mystery. I have seen it mentioned in many articles, but no one seems to know what Apple DOING with this cash, or even in what currencies it is held. There is no dividend.

    Apple clearly is not concerned about boosting its share price, otherwise it would split the stock 10 for 1.

    Maybe things will change when there is a change at the top. Who knows?

    On the face of it Apple does look undervalued, but price is just a function of supply and demand. It could remain in a range for years while other stocks move ahead.

    When every tipster is recommending a stock, it is often a sign that they want to best possible price so they can unload a postition that is going nowhere.
    May 18 07:41 PM | 6 Likes Like |Link to Comment
  • Why We're Nowhere Near a Bottom in Housing [View article]
    Nice article and the concept of homes being a call option on future earnings is a neat idea.

    The trouble with the housing market now is that it is like candlestick charts with too many hanging men left as bagholders.

    But surely there is a "natural price" for homes. Take the price of a plot of land, the cost of building materials and transporting them to the site, the cost of permits, of labour, of a general contractor's 20% take, landscaping, closing costs, and you have the cost of a home. Subtract depreciation if the house is already standing, or appreciation if it has unique or irreplaceable qualities and you have the price of a home.

    Obviously this will vary hugely from state to state due to different building techniques, cost of labor, cost of getting materials to work site, etc., but there can't be any great mystery.

    Of course, while there is an oversupply of foreclosures it will be impossible to build new homes and for the builders to make a profit.

    The overall effect of downward pressure on home prices must be regarded as a benefit for the population in general. What is better, to have a surplus of homes that can be bought cheaper than the cost of building them, or being in the situation they have in Haiti where hundreds of thousands are living in tents?
    May 18 07:28 AM | 6 Likes Like |Link to Comment
  • BP to See 30% Upside [View article]
    Probably right. One of the issues over BP is that the extent of fines for damages caused by the Gulf of Mexico oil spill has not yet been determined and could be tripled if there is a finding of criminal neglignence.

    My feeling is that the worst case scenario won't happen, if only because ultimately this comes down to political issues. BP--I believe it is no longer officially called British Petroleum--is the largest stock in the London FTSE index and comprises a decent size chunk of the index. It is a favorite of pension funds.

    Regardless of whether you think BP should be severely punished or not, in the end by massively fining the company you are not punishing the rig engineers and managers who may have been careless because they were greedy for money, so much as you are punishing pension funds. For this reason I suspect that realpolitik will prevail. Britain hasn't has received a lot of benefit from providing military support in Afghanistan and Iraq--quite the reverse--but favorable treatment of BP could be partial payback or a down payment for support in future wars.
    May 9 03:25 PM | 6 Likes Like |Link to Comment
  • Apple: Desperately Seeking Capitulation (Part 2) [View article]
    I don't know. My wife has a Nokia phone here in the Dominican Republic. It cost $20 per month for 18 months with 250 minutes per month included. She has just finished paying for it. It plays music, movies, connects to the Internet with wi-fi, does Facebook, works as a camera and videorecorder too and is extremely sturdy, with an excellent signal and good voice quality on calls.

    Of course she wants an iPhone now because it has touch and no keyboard and she can show it off to her friends, but really for practical, non-cosmetic purposes there is little difference.

    Now MY phone is a $10 Alcatel, with calling, messaging, and games, but I can live without the games.

    Although smart phone functionality is nice, mostly people buy them for a status symbol, and I suspect the number of people who really need all the functions for business purposes is relatively small.

    The trouble with status symbols is that they may lose their cachet very rapidly as fashions change and it is much harder for them to penetrate more cost conscious markets.
    Apr 20 11:24 AM | 5 Likes Like |Link to Comment