bcncv

One Big Problem with Private Health Insurance

This is alarmist nonsense. Given all of the other issues with health insurance, do you actually think that coverage cancellation is even within the top five issues that need to be covered?

You gave two examples. What is the frequency of occurrence? Does it happen to one out of a million, or one out of ten?

Adding enough information to make these stories realistic would also help. For the man who's policy was canceled after lying about his weight; how much did he lie by? If he lied by 200 pounds and then had health related issues because of weight, there is plenty of ground to cancel a policy.

Leveraged ETF Ban Spreading Like the Flu

I may not be smart enough to figure out exactly how these things operate, or maybe I just don't care enough.

However, being in an internet forum with maybe 20 people that are experienced traders/investors who have read the prospectuses on these things is very telling. Among the 20 people here, no two can agree on how the price of these ETF's are determined, and how they change over time.

After reading a prospectus, and STILL having no idea how these are priced (and realizing I'm not alone in this), I know enough to know that I shouldn't be investing in them.

If you think you understand them and can make money on them, best of luck to you.

XBox Shows Off New Netflix Browsing Feature, Improved Video Quality

Thanks for the review. I look forward to trying it myself. For all of the things Microsoft manages to screw up, they're actually doing a LOT right with the Xbox.

Michelle Caruso-Cabrera, Charlie Gasparino Bash Finance Blogs

There are some smart bloggers out there, and some horrible bloggers. Just like CNBC, the ability to draw an audience is defined by showmanship and by telling people what they want to hear as opposed to true insight.

Regardless of the format, the quality opinions will be mixed in with hundreds (thousands?) of people that can present their ideas in a prettier wrapper.

Citigroup Pricing Anomaly and Efficient Markets

Very good article. I always appreciate looking at practical applications of academic theories. It is the absolute best way to gain an understanding of what those theories can tell you, and what they can't.

A Glimmer of Fiscal Discipline

I wouldn't call this fiscal discipline, only a re-allocation of resources.

The pentagon has made a decision that has been hotly debated within the armed forces. The details are too long to describe here, but essentially a decision was made to focus more resources on fighting our current wars than developing weapons for our next war. There's a reason this decision is coming at the same time as a force increase of 22,000.

Having served two tours in Iraq, I know from personal experience that this is a crucial debate. It is literally a trade off between whether the lives of current Soldiers are being valued higher than the lives of the next generation of Soldiers.

Personally, I think killing the F-22 was the right decision, but I am very glad it was a contentious decision. The value it brings is significant, but in terms of a cost/benefit analysis, I think that money could be better spent elsewhere.

The Importance of Managers Investing Cold, Hard Cash

I agree that cash in is the best scenario, but it isn't realistic in all cases.

I personally know managers that have taken companies from inception to $20+mm valuation in their lifetime. After years of work and foregone wages (during the bad times), it is perfectly natural for them to want to enjoy some of the fruits of their labor. If there is no chance of turning part of that $20mm into cash, then what incentive have you really given to management? Work hard for pieces of paper that will never be worth anything to you?

Now, if you're bringing in new management, that's a different story. In that case, investment is better. I still think their are exceptions, but fewer of them.

Blockbuster Still Lacks a Digital Media Strategy, Ten Years Later

Dan, you are right on about Blockbuster's lack of a coherent digital strategy. Their stock has been in steady decline since 2002, and I can't even see them surviving another 5 years.

The future of the business is digital, and the real winner in the market will be someone doing something new, not a company copying someone else's work. Blockbuster has a history of doing nothing but jumping on the bandwagon after someone else has tried it.

I don't know who the winner in this space will be, but I'm pretty confident that it won't be Blockbuster.

Small Businesses Call CIT's Bluff; Government Says 'No' to Further Aid

While I'm not a fan of bailouts, please be honest about the consequences. Saying small businesses are not "concerned" about financing is completely disingenuous. It's kind of like saying that you're not concerned about Oxygen. It's all well and good until you don't have any.

I work for a small company that has a line of credit (not through Citi). If we lost access to that credit, we would be out of business in 2 weeks.

Are Loan Modification Programs Working?

Very good article. It's good to be reminded that the important statistic is HOW loans are modified, not how many.

The End of Asset Allocation

Just like CAPM, asset allocation works perfect in principle, but breaks down when you try to quantify it in a meaningful manner.

The principles are still good. Pick a number of assets that you think have positive growth characteristics, but make sure there is diversification across industries, asset classes, and even investing styles. Don't be afraid to hold short positions (or puts). Companies that will outperform the market are hard to identify. Those that will under perform are pretty easy to find.

Invest some of your money in different investing styles. For example, put part of your portfolio in index ETF's and write covered calls against it. This part of your portfolio will profit over time, and benefits from non-volatile markets. Take another portion of your portfolio and invest it in a momentum strategy. This strategy does well in volatile markets, and should hold some short positions for diversification.

In the end, any investor can still diversify. Just don't fall into the trap of simplicity and put 70% in equities and 30% in bonds as too many advisers recommend. This makes their job easier, but it makes your portfolio weaker. Also remember, diversification doesn't mean zero risk. It is a tool for reducing risk, but it will never be 100% effective at all times in all markets.

Bankslaughter

Unless someone can define "Reckless lending" in a manner that is consistent over time, this is entirely pointless. Depending on market conditions, credit conditions, and people's general mood, a once solid loan can look completely reckless with 20/20 hindsight.

You can see this change in the political mood by looking at the CIA today. In October 2001, the legislature would have let the CIA do absolutely anything it took in the war on terror. Now they're being second guessed from the sidelines.

Google Drops a Nuclear Bomb on Microsoft. And It's Made of Chrome.

This could be the beginning of an entire shift in the computing industry. Microsoft's largest lever in maintaining their monopoly was by saying "all programs are written for windows, none are written for other OS's".

As more and more functionality has shifted to the web, this is much less important than it used to be. I used to have 50+ programs installed on my PC. Now I have maybe 10. Everything else is web based. And Google has the market power to get those other 10 publishers on board.

I imagine the biggest issue will be compatible external devices like printers, hard drives, cameras, etc. If Chrome OS gets a good response, this will change in the long term, but could cause uptake problems up front.

These are interesting times indeed.

California - And by Extension the U.S. - Headed for Permanently Smaller Economy

I don't disagree with any of the facts you presented, however I found many of the opinions to be subjective statements covered by negative intonations that are groundless. A more cause and effect case would have made your argument much more believable.

For example, I agree with your assertion on housing in CA, but you don't give any reason other than a gut feel for why this is so. Also, your assertion about a "requirement" for $.50 gas is just silly. I'm young enough that I haven't seen $.50 gas in my entire lifetime, and our economy has managed unprecedented growth since 1980.

"Permanently smaller" is also useless without any type of quantification. Are you talking about zero growth? 1% GDP declines for eternity? 10%? I think there is merit in the points you're trying to make, but they just sound silly without more insight into HOW you got from point A to B.

Religious Muslims Now Have an ETF to Call Their Own

It's true that these sectors have outperformed the markets over the past few years. However, there's also the Vice Fund (VICEX) which ONLY invests in alcohol, tobacco, gambling, and defense stocks. The Vice Fund has also generally outperformed the markets for the past few years.

I imagine most of the difference between these funds and the market can be attributed to lack of exposure to financial stocks, as opposed to any ethical factor.