Hank Rearden

Capitalism, Socialism and 10-Year Returns of Country ETFs

Good point razorfangius: "I don't understand your annualized column. It looks like your ten year column, divided by ten." I assume it is just an embarrassing stuff up on his part.

But equally silly is the idea that we can get statistical relevance from a sample of ten countries apparently picked at random.

Andreessen: Facebook Could Do $1 Billion in Revenue

With 200 Million active users Facebook is beginning to dominate; and Facebook’s competitive advantage (its barrier to competition) will only grow with its member base.

In my opinion, social networking sites are a type of natural monopoly (think one big newspaper per city), and since the whole world is connected to the same internet as you and me, the prize at the end of the rainbow is vast for the eventual monopoly holder.

It makes sense for Facebook to run at a loss until such time as their barrier to competition (per member benefit due to member base) is large enough that they can virtually guarantee a dominant market position in the future.

Natural monopolies are very rare (GOOG, MSFT and AAPL are not natural monopolies); but where they do exist they can leverage their position to make ‘unnaturally’ high returns on capital. Mark my words - Facebook will make money eventually, and lots of it.

The Real Crisis Is Food: Beginning of the Bull for Agriculture

There is another side to the Ag story. Without getting too long winded, there is a great deal of underutilized land in South America. This land has not been utilized because of the political situations in Brazil and Argentina over the last 50 years. Whist Argentina is continuing to splutter along with borderline ridiculous policies - Brazil is getting its act together.

Quite often it is argued that "they are not making any more land", but this point is moot.

There will be money made in the AG sector, especially for those who supply the products that help to convert the nonproductive land in South America to productive land. But people who expect real corn, butter, and pork belly prices to rise constantly over a 10year+ time frame do not understand how much land there is in Brazil, that under current political conditions will be brought into use.

A Look at Medtronic's Dividend Increase

The current net debt held by MDT is 15% of market Capitalization. With an interest cover ratio over 12.0, I would not consider that MDT has "too much debt".

Federal Pension Trouble: Its Shift to Stocks

An excellent article. Thanks.