Why have no executives gone to jail for their roles in the financial crisis? Because risk-taking and stupidity aren't criminal, Roger Lowenstein writes. "To look for criminality as the supposed source of the crisis is to misread its origins badly." [View news story]
So the author suggests that the following are not criminal acts.
1) Blatent Mortgage fraud including certifying to a court that all records were reviewed when in Millions of cases they were not.
2) Ratings agencies selling fraudulent ratings for additional business
3) Flash trading which allows special advantages including viewing your trade to trade ahead of you
4) Picking the worst available Mortgage risk securities to package and sell to Pensions and institutions to bet heavily against and make huge profits
I could list more but the point is the author of this post has become so desensitized to fraud that he doesnt even recognize it anymore. It wasnt just fraud it was outrageous in your face fraud meant to seriously cripple its victims.
Who Should an Investor Believe: The Natural Gas Industry or The New York Times? [View article]
I think the debate is a good one to have. I dont think shale gas is fraudulent. At the same time how much gas can be produced at what price and with how many chemical injections are needed is not yet clear.
I largely believe the producers data as far as it goes. At the same time the NY Times is politically aligned against Oil.
However a healthy scepticism over assertions that we have limitless resources at ultra cheap prices is deserved. Whatever the motives I like the questions and look forward to finding more detailed answers.
I will look at the authors logic but before looking at it I have to disagree that IBM is a dangerous stock. Reading the latest analyst reports and being a long term holder I find significant upside to IBM.
Some things I like about IBM include 1) Software and services steady recurring revenues 2) strong financial position 3) large generation of free cash flow 4) High Return on Equity 5) IBM has weathered the worst of this downturn and continued to grow earnings.
On the other hand it isnt hard to believe that Caterpillar and Marriott can have some hard shareholder times.
I read SA because articles like this challenge my beliefs and forces me to consider other perspectives. thanks!
10 Reasons Why We Still Haven't Hit Bottom [View article]
I appreciate the authors perspective. We can debate about whether the bottom is in but I would encourage investors to think long.
1) It may not be the best time to buy stocks but it is a good time. Where was the fear at Dow 14000+ and where is the opportunistic aggression of a Dow 7200.
2) I could be wrong but I see 4% Mortgages creating some RE purchases and increasing disposable income through Mortgage refinancings.
3) Credit cards dont alarm me as the first 15% loss is probably a loss of interest and fees rather than capital.
4) World leaders are acting more or less in concert and are actively engaged. When that happens things ususally improve.
5) Business activity and earnings from a macro sense appear to be bottoming. I dont see fewer homes being sold or fewer cars being sold in the future.
Finally I have to add that I have never found a time not to invest. Whatever you earn save some for yourself and invest it. It always is a great time to invest in the best and worst of market scenarios.
The Damage Control Team Arrives to Save Geithner [View article]
Great commentary!
I believe voters are going to veto incumbents in the next election, How else to deal with the lies, deceit and ouright rape of the average citizen. Democrats have alot to lose but so do Republicans.
Geitner is an outright fraud as was Paulsen. I can understand mistakes but I cant tolerate fraud and deceit by any person and their party.
Procter & Gamble: The Greatest Dividend Stock [View article]
Excellent article!
As a long term holder I would add a couple of details. PG is projecting lower profit in 2011. As such I would not look for the dividend to grow at 10%+ this year in spite of a 45% payout.
PG seemed to stop investing in their brands after the recession and has started back which is increasing their costs. Input costs have also been increasing squeezing margins.
PG is a favorite company over many years and normally provides growth and dividends with a minimum of volatility. With a lack of growth the PE is not as attractive today. I would rate PG a hold and would be a buyer at 62 or less until I see them turn the corner and begin increasing profits. By the way except for the flash crash the stock traded in a range with a low of approximately $59 in 2010
If Jobs is fading away, he has been one of the greatest corporate leaders of the century. He has truly changed the world multiple times. He is a national treasure.
Elizabeth Warren: The End of the Middle Class [View article]
So sad!
Most people that enter this world will never know freedom. We live in a small window of time where freedom is prevalent.
Unfortunately people choose to squander. The result is they lived in a time where they had the opportunity to choose freedom and chose poverty.
Let them sell their farms and businesses. Let them borrow heavily. Let them raise children without a college education. Let them buy huge homes and vehicles and motorcycles and boats and RVs and spend to their hearts content. It is a confession of ignorance!
Unlike most in history they had an opportunity. They just didnt have the moxi. Fortunately people still have a chance. They can choose to move ahead. They will just have to choose to do so.
Perhaps 20% dont have the ability, 20% can get by, 20% have an opportunity but squander it, 30% will live a reasonable existence, 5% will live well but still worry and 5% will live well.
The best news is that the end is not near. It will come soon enough! China has not evolved to choose freedom. India has a cast system which attacks those who try to rise above their class, the islamic world does not believe in freedom.
The result is the free world reigns when it is strong. However it likely squanders its inheritance as it softens and loses its edge. It has returned historically but perhaps after 1000 years. Lessons of the crusades!
Perhaps we are more evolved! When I see squander, drugs, school dropouts and lack of interest I begin to wonder!
My advise is to save at least 10% of your salary or wage. You will need it. It may sound outrageous but saving 20% is not out of the question. Either one will force choices over pure squander. If I am right you will one day be happy you chose to do so.
Trouble Brewing Behind Facade Of Bull Rally [View article]
As an investor I tend to stay invested. I cant say the data presented are persuasive to me.
If stocks were priced at huge PE multiples as I have seen in the past I might be more nervous. However the multiples are very reasonable compared to the past 35 years.
I will wait for compelling evidence rather than nervous fears. Then I will stay invested and move into a more defensive investment posture.
Execs from the oil industry’s Big Five are pilloried by Democrats at a Senate hearing, asking why big oil needs $4B-plus a year in tax breaks while raking in enormous profits. Republicans say that removing incentives would drive production out of the U.S. Political posturing abounded, of course, but the debate is real: Are tax breaks for big oil a consumer ripoff or smart energy policy? [View news story]
The whole discussion is disingenuous. The Democrats just want to gain votes. In the end they will accept campaign donations and allow the same deductions as it is in the countries best interest.
That said it does almost make me vomit to listen to the commercials of big Oil suggesting they are working on algae and green technologies. That was the same line I heard 35 years ago.
As long as Oil lasts it will be the cheapest fuel source. It is true that finding US oil should receive incentives.
14 Stocks George Soros Can't Get Enough Of Today [View article]
I will make a comment one by one on this article and the prospects of the companies mentioned.
WMT - I am not investing in the consumer as the vise tightens around the bottom 50%. Also WMT is adding displays of alcohol across stores lately while products that consumers normally purchase are more often out of stock at least in my experience.
PBR - much more risk of proceeds flowing thru to shareholders exists than is commonly understood.
ORCL- great investment for many years to come
AAPL - great investment opportunity with a measure of risk
UAL - I only invest after airlines are critically injured as happens at least once per decade and many decades more often.
CSCO - currently out of favor and probably a great value investment.
DAL - see UAL
LOW - good investment prospect as houses need updating but the bull years will not return as happened from 2000-2005
HD - same as LOW
LSTAZ - Malone is savvy and consistently makes money. Don't let your interest get divided off.
RIG - I wont offer an opinion as I haven't followed it. In a macro level it would seem a good longer term buy.
GM - We are in the boom for this cyclical. After a 2 year period of reduced auto sales from late 2007- late 2009, we should see good sales from 2010-2011. Still we are in a consumer recession longer term and younger folks in increasing numbers don't even bother to get a drivers license. I will pass on this cyclical.
CVX - I own it and like it. However I wouldnt buy it at current levels.
The Bullish Case for Russian Stocks [View article]
It might be a good thing to consider the rule of law in your investing. The founder of Yukos thought investing in Russia was a good idea. Someday he may get out of jail. He likely wont ever get his investment back.
How about BP? I believe they were forced out at a Govt determined price below cost after developing a valuable resource.
For most investors investing in an area with a strong rule of law is a wise choice.
Fiscal Cliff: Let's Call Their Bluff [View article]
Why have no executives gone to jail for their roles in the financial crisis? Because risk-taking and stupidity aren't criminal, Roger Lowenstein writes. "To look for criminality as the supposed source of the crisis is to misread its origins badly." [View news story]
1) Blatent Mortgage fraud including certifying to a court that all records were reviewed when in Millions of cases they were not.
2) Ratings agencies selling fraudulent ratings for additional business
3) Flash trading which allows special advantages including viewing your trade to trade ahead of you
4) Picking the worst available Mortgage risk securities to package and sell to Pensions and institutions to bet heavily against and make huge profits
I could list more but the point is the author of this post has become so desensitized to fraud that he doesnt even recognize it anymore. It wasnt just fraud it was outrageous in your face fraud meant to seriously cripple its victims.
John Paulson Says to Buy Dividend Stocks and Houses, Sell Bonds [View article]
Based on his history it might be worth checking to see who is unloading the banking stocks he is promoting.
Who Should an Investor Believe: The Natural Gas Industry or The New York Times? [View article]
I largely believe the producers data as far as it goes. At the same time the NY Times is politically aligned against Oil.
However a healthy scepticism over assertions that we have limitless resources at ultra cheap prices is deserved. Whatever the motives I like the questions and look forward to finding more detailed answers.
10 Dangerous Stocks to Avoid [View article]
Some things I like about IBM include
1) Software and services steady recurring revenues
2) strong financial position
3) large generation of free cash flow
4) High Return on Equity
5) IBM has weathered the worst of this downturn and continued to grow earnings.
On the other hand it isnt hard to believe that Caterpillar and Marriott can have some hard shareholder times.
I read SA because articles like this challenge my beliefs and forces me to consider other perspectives. thanks!
10 Reasons Why We Still Haven't Hit Bottom [View article]
1) It may not be the best time to buy stocks but it is a good time. Where was the fear at Dow 14000+ and where is the opportunistic aggression of a Dow 7200.
2) I could be wrong but I see 4% Mortgages creating some RE purchases and increasing disposable income through Mortgage refinancings.
3) Credit cards dont alarm me as the first 15% loss is probably a loss of interest and fees rather than capital.
4) World leaders are acting more or less in concert and are actively engaged. When that happens things ususally improve.
5) Business activity and earnings from a macro sense appear to be bottoming. I dont see fewer homes being sold or fewer cars being sold in the future.
Finally I have to add that I have never found a time not to invest. Whatever you earn save some for yourself and invest it. It always is a great time to invest in the best and worst of market scenarios.
The Damage Control Team Arrives to Save Geithner [View article]
I believe voters are going to veto incumbents in the next election, How else to deal with the lies, deceit and ouright rape of the average citizen. Democrats have alot to lose but so do Republicans.
Geitner is an outright fraud as was Paulsen. I can understand mistakes but I cant tolerate fraud and deceit by any person and their party.
Procter & Gamble: The Greatest Dividend Stock [View article]
As a long term holder I would add a couple of details. PG is projecting lower profit in 2011. As such I would not look for the dividend to grow at 10%+ this year in spite of a 45% payout.
PG seemed to stop investing in their brands after the recession and has started back which is increasing their costs. Input costs have also been increasing squeezing margins.
PG is a favorite company over many years and normally provides growth and dividends with a minimum of volatility. With a lack of growth the PE is not as attractive today.
I would rate PG a hold and would be a buyer at 62 or less until I see them turn the corner and begin increasing profits. By the way except for the flash crash the stock traded in a range with a low of approximately $59 in 2010
Apple: Managing Disaster [View article]
If Jobs is fading away, he has been one of the greatest corporate leaders of the century. He has truly changed the world multiple times. He is a national treasure.
Here's hoping he can make another return.
Elizabeth Warren: The End of the Middle Class [View article]
Most people that enter this world will never know freedom. We live in a small window of time where freedom is prevalent.
Unfortunately people choose to squander. The result is they lived in a time where they had the opportunity to choose freedom and chose poverty.
Let them sell their farms and businesses. Let them borrow heavily. Let them raise children without a college education. Let them buy huge homes and vehicles and motorcycles and boats and RVs and spend to their hearts content. It is a confession of ignorance!
Unlike most in history they had an opportunity. They just didnt have the moxi. Fortunately people still have a chance. They can choose to move ahead. They will just have to choose to do so.
Perhaps 20% dont have the ability, 20% can get by, 20% have an opportunity but squander it, 30% will live a reasonable existence, 5% will live well but still worry and 5% will live well.
The best news is that the end is not near. It will come soon enough! China has not evolved to choose freedom. India has a cast system which attacks those who try to rise above their class, the islamic world does not believe in freedom.
The result is the free world reigns when it is strong. However it likely squanders its inheritance as it softens and loses its edge. It has returned historically but perhaps after 1000 years. Lessons of the crusades!
Perhaps we are more evolved! When I see squander, drugs, school dropouts and lack of interest I begin to wonder!
My advise is to save at least 10% of your salary or wage. You will need it. It may sound outrageous but saving 20% is not out of the question. Either one will force choices over pure squander. If I am right you will one day be happy you chose to do so.
Winter's Coming for the Boomers: Part 2 [View article]
It sounds like nothing good can ever happen again. It is a good thing the 1st half of my life has been so wonderful.
Trouble Brewing Behind Facade Of Bull Rally [View article]
If stocks were priced at huge PE multiples as I have seen in the past I might be more nervous. However the multiples are very reasonable compared to the past 35 years.
I will wait for compelling evidence rather than nervous fears. Then I will stay invested and move into a more defensive investment posture.
Execs from the oil industry’s Big Five are pilloried by Democrats at a Senate hearing, asking why big oil needs $4B-plus a year in tax breaks while raking in enormous profits. Republicans say that removing incentives would drive production out of the U.S. Political posturing abounded, of course, but the debate is real: Are tax breaks for big oil a consumer ripoff or smart energy policy? [View news story]
That said it does almost make me vomit to listen to the commercials of big Oil suggesting they are working on algae and green technologies. That was the same line I heard 35 years ago.
As long as Oil lasts it will be the cheapest fuel source. It is true that finding US oil should receive incentives.
14 Stocks George Soros Can't Get Enough Of Today [View article]
WMT - I am not investing in the consumer as the vise tightens around the bottom 50%. Also WMT is adding displays of alcohol across stores lately while products that consumers normally purchase are more often out of stock at least in my experience.
PBR - much more risk of proceeds flowing thru to shareholders exists than is commonly understood.
ORCL- great investment for many years to come
AAPL - great investment opportunity with a measure of risk
UAL - I only invest after airlines are critically injured as happens at least once per decade and many decades more often.
CSCO - currently out of favor and probably a great value investment.
DAL - see UAL
LOW - good investment prospect as houses need updating but the bull years will not return as happened from 2000-2005
HD - same as LOW
LSTAZ - Malone is savvy and consistently makes money. Don't let your interest get divided off.
RIG - I wont offer an opinion as I haven't followed it. In a macro level it would seem a good longer term buy.
GM - We are in the boom for this cyclical. After a 2 year period of reduced auto sales from late 2007- late 2009, we should see good sales from 2010-2011. Still we are in a consumer recession longer term and younger folks in increasing numbers don't even bother to get a drivers license. I will pass on this cyclical.
CVX - I own it and like it. However I wouldnt buy it at current levels.
Just one perspective! Hope it is helpful.
The Bullish Case for Russian Stocks [View article]
How about BP? I believe they were forced out at a Govt determined price below cost after developing a valuable resource.
For most investors investing in an area with a strong rule of law is a wise choice.