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Archive for April, 2012

Today’s Congress More Divided than Ever? Hardly.

April 27, 2012 Leave a comment

I consistently hear from US investors that today’s politics “have never been more divided.” Hardly. One of the many great benefits of studying history is to understand what is truly precedented and unprecedented. David S. Reynolds’s new book offers some insight on what’s been centuries of excoriating debate in the US Congress—often with the country’s very existence on the line. Today is not so new—what’s new is the bluster and shrill of today’s internet and cable media culture.

Statesmanship In a Divided Era – David S. Reynolds

America’s Great Debate: Henry Clay, Stephen A. Douglas, and the Compromise That Preserved the Union – Fergus M. Bordewich

Will Europe Follow Deficit Targets? Forget it.

April 19, 2012 Leave a comment

This blog has maintained Europe will be weak for the foreseeable future, but won’t catalyze a new global recession or bear market in stocks. (Though, in my view, it’s best to tread ballet-toe-lightly with sovereign bonds).

But there’s a big difference between saying Europe won’t cause a global meltdown and saying Europe will soon fix its ills. The very notion—treaty or otherwise—Eurozone countries will soon resolve all their deficit problems is laughable.

Italy puts back balanced budget goal by a year – Giuseppe Fonte, Reuters

To Be a Forecaster, Be a Weatherman

April 11, 2012 Leave a comment

As I say in most all my writings about forecasting and economics: Market behavior is much more like a CEAS (Complex Emergent Adaptive System) than it is a neat and tidy math-based equilibrium model. Here’s a fun piece:

Economists Have a Lot to Learn From the Weather

Abundance: Peter Diamandis’s Must see TED Talk (and New Book)

April 9, 2012 Leave a comment

This blog has long fought the inertia of dystopic Mathusian thinking, which never proves true but continues to be one of the prevailing fictional narratives of intellectual discourse. Matt Ripley’s The Rational Optimist was one of the best investing/econ related books of the last few years. Now comes Peter Diamandis’s new book Abundance.

Check out these books, and see Diamandis speak on the subject here:

http://www.ted.com/talks/peter_diamandis_abundance_is_our_future.html

Taste What You’re Missing

April 6, 2012 Leave a comment

Looking for some non-investment related reading as the Spring springs? Try Barb Stuckey’s Taste What You’re Missing. By turns entertaining and informative, this is one of the best books around detailing the art and science of your palette. Everyone has to eat—you may as well know how to do it right.

A favorite part of the book are the “experiments” you can easily do from your own home to highlight and develop your sense of taste. If you’re as palette blind as I, this book wasn’t just a great primer, it also saved me from sounding like a culinary dunce to my friends.

15 Points to Look for in a Common Stock

April 2, 2012 Leave a comment

Sometimes (actually fairly often) it’s good to revisit the investment classics that stand the test of time. From Philip Fisher’s Common Stocks and Uncommon Profits, great questions to ask about a company before considering a stock investment:

Point 1: Does the company have products or services with sufficient market potential to make possible a sizable increase in sales for at least several years?

Point 2: Does the management have a determination to continue to develop products or processes that will still further increase total sales potentials when the growth potentials of currently attractive product lines have largely been exploited?

Point 3: How effective are the company’s research and development efforts in relation to its size?

Point 4: Does the company have an above-average sales organization?

 Point 5: Does the company have a worthwhile profit margin?

Point 6: What is the company doing to maintain or improve profit margins?

Point 7: Does the company have outstanding labor and personnel relations?

Point 8: Does the company have outstanding executive relations?

Point 9: Does the company have depth to its management?

Point 10: How good are the company’s cost analysis and accounting controls?

Point 11: Are there other aspects of the business, somewhat peculiar to the industry involved, which will give the investor important clues as to how outstanding the company may be in its relation to its competition?

Point 12: Does the company have a short-range or long-range outlook in regard to profits?

Point 13: In the foreseeable future will the growth of the company require sufficient equity financing so that the larger number of shares than outstanding will largely cancel the existing stockholders’ benefit from this anticipated growth?

Point 14: Does the management talk freely to investors about its affairs when things are going well but “clam up” when troubles and disappointments occur?

Point 15: Does the company have a management of unquestionable integrity?

 

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