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nelsonsdad

nelsonsdad
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  • Justice For Coca-Cola Shareholders [View article]
    This article misses the point, COMPLETELY. If Buffett votes his shares against, the plan still passes, except by about 74%.

    Mr. Buffett, being much smarter than that keeps his powder dry, and by working behind the scenes exerted far more influence than he could have by voting. Because he can pick up the phone and talk to any board member, and any company executive, he wields great power behind the scenes.

    His failure to prevail in a vote would likely have been the end of it. By not offending the leadership publicly (notice, he did not rubber stamp them, and vote yes) he retained all his personal power, and is now exercising that power to both his advantage, and the advantage of all other non-employee shareholders. Thank you, Sir.
    May 1 09:50 AM | 10 Likes Like |Link to Comment
  • Winners and losers in Consumer Reports' auto survey [View news story]
    As a knowledgeable owner who self-services four GM vehicles, gratuitous bashing of their quality shows a lack of knowledge. The roads are crowded with 15-30 year old Detroit iron. Where are the 30 year old foreign cars? GM broke the code on fuel mileage 20 years ago. All my Chevy Luminas and Impalas get over 30 mpg highway, and 25 around town in summer. These are full sized cars.

    For drivers to have trouble with software is understandable. Happily software is correctable and replaceable, and the buyers should have worked with it enough in the showroom to determine whether it met their needs. For software issues to be the "bottom line" on evaluation of what might be otherwise well-designed and executed automobiles exhibits a lack of understanding of the relative importance of the various facets of the product.

    CU evaluations have always been rather nutty. My 1972 Renault was marked way down for being the first car with controls on the stalks (confusing). Two years later when Honda came out with a similar system it was lauded as "the latest advance in engineering." I cannot sign off on anything CU concludes. Do your own testing and observation, and trust what you see, not what you read.
    Feb 25 07:35 PM | 3 Likes Like |Link to Comment
  • Why It's A Mistake To Raise Cash For Fear Of A Market Crash [View article]
    I abandoned stocks in June, 2001, due to a distrust of the Bush administration, and the beating I'd been taking during the prior two years as the market corrected (particularly the NASDAQ.) As a result I thrived during the fall of 2001 as I was invested in bonds, where everyone else ran after I was already in. I have always told my wife that stock market gains are not gains unless the stock has been sold. By not becoming greedy, taking reasonable gains, and sticking with solid companies paying dividends I have been modestly successful. Cash and bond investments combine with a reasonable amount of stock investing to be a balanced plan allowing much greater relaxation and better sleep. If my total return is less than that available fully invested so be it. Most look-backs choose their investments and their time periods carefully. You could not have written the above article in 1974, and I'm certain some people were devastated by the DOW 400 achieved that year.
    Dec 29 06:53 PM | Likes Like |Link to Comment
  • Why It's A Mistake To Raise Cash For Fear Of A Market Crash [View article]
    I dislike using this word, because it is too strong, but how clear was it, in 1994, that United Technologies was clearly the stock to buy. Anyone can look back 20 years, and find one of the best performing large companies, and say, "hey, all you have to do is find a great company and stick with it forever (20 years." What happened to goose UT's earnings in 20 years. Two wars. Without the horrible world situation since 2001 defense spending could have been cut drastically, and UT would not have done so well. They make commercial jet engines, but are getting beaten badly by GE and the European manufacturers.

    A more useful article would be to identify the proper stock to buy today which would give a comparable return over the next 20 years. Guess what. Nobody can do that with any level of assurance. Many "great stocks" could have been bought in 1994, held for 20 years, for little gain, or a drastic loss.
    Dec 27 05:24 PM | Likes Like |Link to Comment
  • Rite Aid Corp.: A Long-Term Buy [View article]
    The idea that someone would short RiteAid and then bash it here in the hopes of making a profit is rather absurd, similar to taking hold of two hairs on the end of an elephant's tail with the intention of swinging it around one's head. It is also not something I would do.

    The location I wrote of in NYS (Bath) is newly constructed on a prime corner, slightly better located than the Walgreens across the street. For RiteAid to have to "abandon" or give up a location because there is a competitor across the street is exactly why their future is bleak.
    Dec 25 06:34 PM | Likes Like |Link to Comment
  • Rite Aid Corp.: A Long-Term Buy [View article]
    I bought and sold RAD in the last year, and made 100% (thanks, Seeking Alpha). However, I shopped a store in Upstate NY recently, and what I saw will keep me away from the stock in the future. Note, that the article says front-end sales diminished in the last reporting period. Here's why. The front end of the store looks like a Family Dollar. Cheap, non-namebrand merchandise being sold at non-competitive prices. That is not the look that a drugstore needs upfront. A customer passes cheap merchandise on the way to the Pharmacy in the back, and this is not the look that will build confidence. The store in question is directly across the street from a very busy Walgreen's, and seems to do almost no business. I think they're completely off-base, and a bad investment.
    Dec 25 11:36 AM | 1 Like Like |Link to Comment
  • Citi upgrades Qualcomm, downgrades BlackBerry, starts Cisco at Sell [View news story]
    A sell call on Cisco is useless at this point. You can only sell it if you own it (or if you wish to really take a risk, sell short.) If you own it now, why sell low? With the strong financials and dividend, which is likely to increase, and a fast moving internet landscape which is impossible to predict, how can one bet against the strongest networking company in the world?

    A bet against Cisco is a broad bet against the future of the internet, and the future. Hard to make money on that basis.
    Dec 10 08:06 PM | 4 Likes Like |Link to Comment
  • 3 Reasons Why A $10 Burrito Could Be Chipotle's Next Catalyst Higher [View article]
    As an individual who made his living on the road for 30 years, I have eaten more food "out" than most people. With that as background, and my preference for "tex-mex" food continuing, I have to aver that the writer of this article is completely nuts. Those who see a 50% price increase will walk in, walk out, spread the word, and Chipotle will be out of business in 30 days. A three percent increase in food cost justifies a tiny price increase. Lack of perceived value in the customer's mind would simply result in no business.

    People walk out of food establishments because of long lines (let's save money with fewer employees), poor service (let's pay those employees minimum wage), bad food (lets drop our quality standards to save money), and dirty stores (let's cut down on maintenance.) Increasing prices 50% with no perceived increase in value is simply not possible.
    Dec 8 08:47 AM | 7 Likes Like |Link to Comment
  • Why Do Troubled Companies Like BP Outperform Coca-Cola For 20+ Years? [View article]
    An earlier article about a ten thousand dollar investment in a seemingly safe St. Louis bank in 1993 which would be virtually valueless today highlighted the perils of reinvested dividends. The recommendation there was to take dividends as cash and reinvest them in something else, so that if something catastrophic happens to the first investment vehicle, the profits will be safe elsewhere. This strategy is clearly a case of diversification resulting in risk reduction. The risk in Coca Cola during the '90's was that it was overpriced. Each investment vehicle carries within its own risk profile.

    Bottom line on your article - the Coca Cola investor slept better for the last twenty years than the BP investor, and we don't have a way of assessing the value of a good nights sleep.
    Dec 2 12:41 PM | 3 Likes Like |Link to Comment
  • Why The U.S. Stock Market Is Headed Into A Brick Wall [View article]
    The reference to "entitlement spending due to the aging population" beginning in 2015 is incorrect. Social security benefits are separately funded. SSA shows a current 2.3 trillion dollar surplus, invested in Treasury bonds. That the government has borrowed this surplus means that eventually the Treasury will have to either tax or borrow in the marketplace to pay the 2.3 trillion back to the SSA as they need it. The Treasury's cash flow will be affected by Social Security asking for their money back, but none of this will affect the "deficit," which refers to general fund spending.
    May 26 10:32 AM | Likes Like |Link to Comment
  • Reinvesting Dividends Vs. Saving Them And Buying On Stock Price Drops [View article]
    An earlier article here showed the danger of reinvesting in the same company because if that company fails of suffers a negative takeover (the example given was a large St Louis bank from 1990) all could be lost. The suggestion was to use the dividends to invest in something else, eventually broadening the roster of investments.

    I have no data, but I respect the concept.
    Apr 21 09:47 PM | Likes Like |Link to Comment
  • Rite Aid: The Retail Stock Under $5 You Should Buy [View article]
    Unfortunately, you're actually describing Michigan, with its cities being taken over by unelected managers selected by a corrupt Republican power structure. Rite Aid stores are not the only thing in Michigan in need of "remodeling."
    Apr 16 04:58 PM | Likes Like |Link to Comment
  • Dark Times Ahead For Cisco [View article]
    Sadly uninformed - Cisco is clearly the market leader in switches, and no way can software ultimately "do away" with the need for hardware.

    At the same time they are busy doing exactly what this writer is suggesting they do, broaden out into a more software-based business model. Unfortunately, they thought of it first.

    Let me be the first to announce this as a unique buying opportunity for those who find themselves short CSCO.
    Mar 26 06:47 PM | Likes Like |Link to Comment
  • "Here's a novel way to drive up a company’s share price," writes the NYT's Jeff Sommer. "Pay billions of dollars in additional taxes." Forensic accountant Robert Olstein reckons that companies such as Apple (AAPL), Microsoft (MSFT) and Cisco (CSCO) should repatriate the tens of billions dollars they hold abroad, pay tax on it, and then use the rest of the cash to repurchase stock. That would boost their share prices by at least 20%. [View news story]
    Since when should corporations not do their civic duty and pay taxes? Guess what - they could buy the European version of ADS shares, and accomplish the same thing without paying taxes.
    Mar 25 08:54 AM | 1 Like Like |Link to Comment
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