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Villi Grdovich

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  • Russia escalates tensions over Ukraine [View news story]
    Blue, I have it on reasonable authority that no war game scenario has ever resulted in the Germans defeating Russia. Just as in the real thing, it was a war of attrition and there are just too many Russians, and Russia is just too big. Without Russia, it should be acknowledged, there may well have been at least 500,000 very fresh Germans saying hello to the Allies in Normandy, in which case, Hitler may well have died of old age.
    Mar 2 05:19 AM | 35 Likes Like |Link to Comment
  • Advice For Young Investors [View article]
    An old Italian saying

    "By the time you realized that your father was right, your son is telling you you are wrong".

    Bet that never changes...and I might add that Luciano Pavarotti's dad advised him to stick to teaching and not to become an opera singer. The gift I give to my kids is perspective, which I did not have as a youngster.
    Jun 6 03:16 AM | 15 Likes Like |Link to Comment
  • Why It's More Important Than Ever to Create Your Own Retirement Solution [View article]
    What needs to happen is the creation of corporations of over 60's employees.

    I have found it almost impossible to put up with some strands of younger workers, and I have been told that adding older workers, even if better than younger ones, upsets the workplace balance.

    So, for me , doing work I love to do is only possible if I do my own thing, or join like minded oldies in an oldies corporation.
    May 15 05:20 AM | 14 Likes Like |Link to Comment
  • Seeking Alpha Crowd Wisdom Predicts Future Stock Returns [View article]
    When doing my own limited survey some time ago, I came to the conclusion that the comments provided more informational content than the articles, so its very interesting that this study included this aspect of SA articles. However to actually put in place a formal process to measure this data seems very daunting.
    Mar 19 07:11 PM | 13 Likes Like |Link to Comment
  • Frankenstorm 'The Not-So-Black Swan': Climate As The New Risk Variable [View article]
    Watching Frankenstorm, and indeed Katrina on TV in Australia, and being quite interested in the analysis of hurricanes, I can only say I am amazed at the poor quality of infrastructure in the US given exposure to these weather events.

    A big cyclone went through North Queensland in the past few years, and most, if not all modern construction survived very well. Whatever your view on climate change, it is impossible to think that anyone would build a house on the beach given that these storms are well documented to cause massive storm surges going back 100 years if not more. Then one comes along and the reaction, who would have thought.

    The Netherlands, that is the whole country, went underwater in 1953 and they had no trouble designing and building their sea defences. The Dutch coast doesn't look anything like Atlantic City or New Orleans, and I bet it never will.

    London was concerned that its subway might flood during severe storms and built a barrier across the Thames. Now I am aware that New York is in danger of severe storm surges going back to the 1830's, but apparently it is prepared to take the damage rather than prevent it.

    So I understand the thrust of the article, but I have to say, the US appears badly set up whether the weather is getting worse or not.
    Nov 14 05:42 AM | 13 Likes Like |Link to Comment
  • New York City Home Prices Are Headed for Collapse [View article]
    Its probably a lot of fun ferreting out these statistics. But, how is it that the real estate industry can avoid the sort of disclosure that applies to other asset classes, such as financial instruments and shares? And isn't it about time they were forced to?
    Jun 3 05:35 AM | 12 Likes Like |Link to Comment
  • Unemployment Chart of the Day [View article]
    As far as i am concerned, anyone who has a job only because of a government stimulus package is an unemployed person on a high wage. And how many of them are there...millions. Why pick on an unemployed person making do on food stamps.
    Jul 21 05:25 AM | 12 Likes Like |Link to Comment
  • The Last World War Helped the Economy: Why Not Another One? [View article]
    Strangely enough, I think there is a case to be made that WW2 did result in economic progress, but not due to some misdirected government deficit spending. WW2 resulted in a huge increase in technical and productive capacity.

    In 1940, the Bismark was sunk by torpedoes fired from a bi-plane. By 1945, US bombers were being shot up by jet and rocket powered aircraft, and Britain bombed by V1 and V2 rockets. By 1945 large aircraft could fly the Atlantic. Hunderds of planes and tanks could be made per week due to manufacturing and planning advances. Engineers could build an artificial harbour to support supply ships post the D-Day landings. The ships supplying the war effort were due to advances in welding. And lets not forget such trivia as the development of the atomic bomb, and all of the scientific knowledge that came as a result of that development.

    While it may well have been due government deficit spending, the world looked totally different in 1949 as compared to 1939.

    Microsoft, IBM and others did it again in the 1990's, and now we need to think of the next new major technological gain, but does it exist?
    Jul 20 06:01 AM | 12 Likes Like |Link to Comment
  • Thoughts on Market Timing [View article]
    John, my problem with the smart money/dumb money argument is that I have not seen a quantitative analysis that these people exist "en masse".

    I have spent some time looking at WhaleWisdom web site and especially at what the rich and famous have bought and sold, then correlating that to subsequent perormance,and likewise, I don't see the consistency that would make me co-invest with these people.

    Very early on, I also looked at total market performance post an "overvalued/undervalued" scenario, and I was very disappointed to find that there is no correlation.

    So, I guess I have a dilema, in that all of this sounds plausible, and it feeds on my behavioural biases, but its probably not contributing to my retirement.
    Dec 25 04:45 PM | 11 Likes Like |Link to Comment
  • The Top 3 Ways to Play Uranium [View article]
    By stating that "only 51,000 tons are mined every year. Many reactors are running at 50% capacity. Some have even been taken off-line." you imply that the lack of uranium is the cause. Yet a few years ago, reactors were being taken off line and treated as stranded assets by regulators, for reasons other than lack of fuel.
    Feb 21 04:17 AM | 10 Likes Like |Link to Comment
  • Real Estate Is Not a Good Investment When Interest Rates Are Low [View article]
    Not quite.

    High interest rates come with strong economic activity, and mortgages are not pure financial instruments as are bonds. A nice house in a nice neighborhood is an aspiration that the well off have. If economic activity is strong, interest rates will be high and interest in real estate will increase. History comprehensively shows that.
    Nov 2 05:38 AM | 10 Likes Like |Link to Comment
  • U.S. Economy: Be Careful What You Wish For [View article]
    This comment originates from Australia.

    I recently had a gall bladder operation for a total cost of $3000. I pay $100/month for 100% hospital cover, the surgeon charges $1,300 which is totally paid by the Federal Government and the anesthetist charged $700.

    We recently met a Canadian woman who had her gall bladder removed in Florida. She was charged $80,000 by the hospital, this reduced to $40,000 on negotiation by her medical insurance.

    The US medical costs appear from a distance to be self inflicted wounds, and the cost of medicare would appear to be bloated, not by some misguided social welfare mentality, but by something quite the opposite. If this ends up causing financial destruction in the US, then it would appear that medicine ranks up there with real estate and derivatives as unimaginable culprits.

    And for a little bit more, Australia introduced a VAT style tax a few years ago with no discernible effect on the standard of living, and lifted the pension age for women from 60 to 65 without so much as a squeak from the population....and the living here has never been better.
    Oct 31 07:26 AM | 10 Likes Like |Link to Comment
  • An Epic Australian Bust [View article]
    While everything mentioned above is well supported, I think it should be noted that Australia has dodged every bullet ever fired at it in all of its history.

    In the 1950's a book was written, probably on similar well thought out concerns about the economic and social issues of the day, called "The Lucky Country". The author means to ask, what happens when the luck runs out?

    It never has, it has only multiplied.
    Feb 27 02:54 PM | 9 Likes Like |Link to Comment
  • The New Reality of Retirement [View article]
    I saved for my retirement and was doing well. Then a sheik in Dubai potentially defaulted on loans used to build lavish 6 star hotels with equally lavish aquariums and ski fields insulated from 50 degree desert heat.

    I have nothing to do with this guy. None of my investments are in any way connected with this extravagant waste, and hate to see money deployed in this way.

    Nevertheless, the value of my share portfolio tanked and my dividends were cut and my central bank cut interest rates to unsustainable low levels. Now i cant live a comfortable retirement, but why not. Because of profligate behavior on the part of people outside of my legal and financial system, over whom I have no control.

    Something wrong with that ?
    Mar 5 04:45 AM | 9 Likes Like |Link to Comment
  • Economists Menzie Chinn and Jeffry Frieden argue that as debt is the major factor dragging on economic growth, inflation should be allowed to rise. This "would reduce the real burden of debt on households, corporations and governments, spurring both investment and consumption." However, while the Chicago Fed's Charles Evans supports the idea, Ben Bernanke doesn't. (Summary)  [View news story]
    I scanned this article and unless mistaken, the arguments appear to advocate inflation as it relates to debtors and creditors.

    We are constantly told that the cost of providing welfare to retiring baby boomers is a cost to expensive to bear. By increasing inflation, the retired sector of the economy quickly runs out of money, and becomes even more of a burden on the general economy. It appears to me that any argument that does not address this huge social consequence has absolutely no merit.

    The real falsity of this argument is that, to protect my savings from disappearing under the weight of inflation, I and all retirees, would be best served by borrowing to fund the purchase of real assets which might withstand the ravages of inflation...which is where the discussion started.
    Jul 22 06:55 AM | 8 Likes Like |Link to Comment