Friday File

Fri, 2017/09/22 - 1:23pm | Your editor

 

It takes one to know one. Scandal-ridden Wells Fargo has upgtraded Equifax, the hacked and disgraced credit rating agency, to buy.

Notices of private corporate actions filed with the US Securities and Exchange Commission were hacked by what may have been insider traders. Many years ago our ADR Guide quarterly publication was hacked from the Library of Congress by the securities regulators and the IRS in violation of our copyright (why we filed with the Library.) I found it too much trouble to try to deal with the Feds and stopped publishing the guide which I still use for ADR ratios and the like.

Microsoft hit me with a blockage of my desktop password when I signed in after the Jewish holiday, requiring that on this hectic catch-up day that I spend time hopping from computer to computer. Now it is merely cutting me off every 5 minutes or so. Meanwhile the phone repair has been rescheduled for Sept 28. Welcome to Ouagadougou.

Connectivity, which used to be the bright spot in Century 21 is now becoming a black hole.

 

So today's blog will consist mostly of one-liners unless more is needed like reporting deals.

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Jewish New Year Cometh Amidst Disasters

Wed, 2017/09/20 - 12:54pm | Your editor

 

The most important thing is that our contacts in Mexico City are all well. I checked with Eduardo Garcia who runs sentidocomun.com.mx and with Maria Eugenia Pichardo of Mexican Equity & Income Fund. Both report that their entire staff and relatives are accounted for and unhurt although Maru reports that walking down 22 flights of stairs in her office building was a novelty.

The Bolsa was not closed and wobbled a lot because the economic impact of the quake was not yet clear.

 

*VA reader CP added to my coverage of medicare pricing, pointing out that the Veterans Administration can negotiate low prices for pharmaceuticals because it buys in huge volumes. However its formulary doesn't include the newest drugs. Meanwhile the rules for Medicare D specifically enjoin the drug program for seniors from negotiating lower prices, giving “a real gift to big pharma.”

 

It doesn't look like the latest GOP attempt to repeal Obamacare has wings, but we need to be aware that the US system still is based on deals which are bad for patients. Medicare D is means tested and the monthly fees for those of us who planned for our retirement are going up by about 35% in 2018. Meanwhile Bernie Sanders is boosting single-payer Medicare for all on Friday on facebook.

 

US markets are focused on the Federal Reserve Open Market Committee meeting this afternoon when analysts expect more information on how fast the Fed will unwind the bond and mortgage-backed securities purchases it made after the Global Financial Crisis. However a rate hike is now considered unlikely given the hurricanes but, just in case, Wall Street is cautious.

 

We are cautious and are taking part profits at two Asian high flyers in our portfolio. In fact this requires that we lower our risks with 3 stocks, discussed below for paid subscribers. And we sell a northern neighbor stock too.

 

No blog tomorrow. Middle Eastern markets, starting with Israel, close for 4 days for the New Year so we will begin with Israel today. Happy New Year 5778 to you all and a hope for less dramatic weather, a more stable earth, good health, prosperity, and peace on earth.

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Jewish New Year Cometh Amidst Disasters

Wed, 2017/09/20 - 12:54pm | Your editor

 

The most important thing is that our contacts in Mexico City are all well. I checked with Eduardo Garcia who runs sentidocomun.com.mx and with Maria Eugenia Pichardo of Mexican Equity & Income Fund. Both report that their entire staff and relatives are accounted for and unhurt although Maru reports that walking down 22 flights of stairs in her office building was a novelty.

The Bolsa was not closed and wobbled a lot because the economic impact of the quake was not yet clear.

 

*VA reader CP added to my coverage of medicare pricing, pointing out that the Veterans Administration can negotiate low prices for pharmaceuticals because it buys in huge volumes. However its formulary doesn't include the newest drugs. Meanwhile the rules for Medicare D specifically enjoin the drug program for seniors from negotiating lower prices, giving “a real gift to big pharma.”

 

It doesn't look like the latest GOP attempt to repeal Obamacare has wings, but we need to be aware that the US system still is based on deals which are bad for patients. Medicare D is means tested and the monthly fees for those of us who planned for our retirement are going up by about 35% in 2018. Meanwhile Bernie Sanders is boosting single-payer Medicare for all on Friday on facebook.

 

US markets are focused on the Federal Reserve Open Market Committee meeting this afternoon when analysts expect more information on how fast the Fed will unwind the bond and mortgage-backed securities purchases it made after the Global Financial Crisis. However a rate hike is now considered unlikely given the hurricanes but, just in case, Wall Street is cautious.

 

We are cautious and are taking part profits at two Asian high flyers in our portfolio. In fact this requires that we lower our risks with 3 stocks, discussed below for paid subscribers. And we sell a northern neighbor stock too.

 

No blog tomorrow. Middle Eastern markets, starting with Israel, close for 4 days for the New Year so we will begin with Israel today. Happy New Year 5778 to you all and a hope for less dramatic weather, a more stable earth, good health, prosperity, and peace on earth.

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Jewish New Year Cometh Amidst Disasters

Wed, 2017/09/20 - 12:40pm | Your editor

 

The most important thing is that our contacts in Mexico City are all well. I checked with Eduardo Garcia who runs sentidocomun.com.mx and with Maria Eugenia Pichardo of Mexican Equity & Income Fund. Both report that their entire staff and relatives are accounted for and unhurt although Maru reports that walking down 22 flights of stairs in her office building was a novelty.

The Bolsa was not closed and wobbled a lot because the economic impact of the quake was not yet clear.

 

*VA reader CP added to my coverage of medicare pricing, pointing out that the Veterans Administration can negotiate low prices for pharmaceuticals because it buys in huge volumes. However its formulary doesn't include the newest drugs. Meanwhile the rules for Medicare D specifically enjoin the drug program for seniors from negotiating lower prices, giving “a real gift to big pharma.”

 

It doesn't look like the latest GOP attempt to repeal Obamacare has wings, but we need to be aware that the US system still is based on deals which are bad for patients. Medicare D is means tested and the monthly fees for those of us who planned for our retirement are going up by about 35% in 2018. Meanwhile Bernie Sanders is boosting single-payer Medicare for all on Friday on facebook.

 

US markets are focused on the Federal Reserve Open Market Committee meeting this afternoon when analysts expect more information on how fast the Fed will unwind the bond and mortgage-backed securities purchases it made after the Global Financial Crisis. However a rate hike is now considered unlikely given the hurricanes but, just in case, Wall Street is cautious.

 

We are cautious and are taking part profits at two Asian high flyers in our portfolio. In fact this requires that we lower our risks with 3 stocks, discussed below for paid subscribers. And we sell a northern neighbor stock too.

 

No blog tomorrow. Middle Eastern markets, starting with Israel, close for 4 days for the New Year so we will begin with Israel today. Happy New Year 5778 to you all and a hope for less dramatic weather, a more stable earth, good health, prosperity, and peace on earth.

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On Toys and Treats

Tue, 2017/09/19 - 1:39pm | Your editor

When my grandchildren were younger a top feature of their visits was to take them to Toys R Us near Times Square, where the very exciting flagship store was located, full of clowns and free adventures. The payback for the company was that the kids clamored for presents which their indulgent grandma bought, at least when they were suitable or affordable and not too fragile or faddish.

Now a decade later with three grandchildren certified as superior teenagers, two of them learning how to (uh oh) drive, and the other two making rapid progress toward the pattern of sleeplessness and arrogance and Bar Mitzvoth required, the shop is no longer a destination when they visit.

We also did the same thing when they came to London, hitting Hamley's on Regent Street, a much older toy emporium which survives. The thing I remember most vividly from there is the total panic with which our eldest grandchild, then 5, reacted to the stuffing machine at the Build A Bear stand in the store.
The bankruptcy of Toys R Us is also poignant for a victim of its selling formula. You visit an internet toy vendor solo without having to deal with the demands of the recipient kiddies. Amazon strikes again.

 

We have news today from Brazil, Britain, Canada, Chile, China, Denmark, Germany, Hong Kong, India, Finland, Israel, Japan, Portugal, Spain, and Nevada  including more about treats for kiddies below.

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Taking Off

Mon, 2017/09/18 - 2:37pm | Your editor

My headline is a triple entendre for paid subscribers. I cannot resist a pun.

Greetings from Calcutta-on-Hudson. Today is the day the 2nd team from Verizon is expected to come and relink our land lines. We have another promise for Wednesday. But the odds seem high that the new Jewish year of 5778 will begin (Wednesday night) before our lines are restored after a sewer fire.

One of the annoying side-effects of this mess is that my ability to get into my brokerage account is limited because apparently my voice doesn't sound the same with the cellphone as with the landline, so it cannot act as my (haha) password.

That doesn't mean the stupid system at Charles Schwab is not also responsible for the lack of linkage, because of course I know my eldest child's middle name and my password, as I am descended from a famous Schwabian rabbi. My password  I changed last night when I finally could get through to a Schwabian human being rather than being subject to a repetitive recording of the stock market news—of last Friday!

I only learned from Jack last night that I couldn't re-set my password to an earlier one, because at the Schwab Park Avenue office I was not told. I was also not told that I was supposed to add the number code from my Symantec device after the password, rather than in a separate box as I had leanred less than two months ago when I opened my account. As is often the case the folks from customer service are not informed by the technology guys about rule changes. Clients are on their own if the techies are left to make rules without oversight.

Anyway, I wrongly blamed Equifax's for my woes on Sunday in a headline. It wasn't them. It was VZ and SCHH. Which does not mean I am going out to buy EFX stock as one writer suggested on seekingalpha.com this morning. All the bad news has not yet hit the fan there. And I sold half my Verizon because I suspect their failure to repair our landlines is to force us to switch from copper to fiberoptic (as a building, not individually) or to boost our use of our cellphones (also from VZ) even when not on the move.

 

*The problem with Team Trump is that they are ill-informed. A NY Times article reports that in the meeting of Chuck Schumer and Nancy Pelosi Trump had them briefed by the White House cabinet secretary, John Kelly Kelly kept suggesting that a border wall is needed because Mexico faces the collapse of its security and policies. Kelly, Trump's former security secretary who has been promoted, claimed there is a parallel with Venezuela's formerly populist Maduro government if Andres Manuel Lopez Obrador wins the next election south of the border. He thinks the Great Wall of the Rio Grande is needed to stop more immigrants getting across and bearing new “dreamers.” Chinese food was served.

 

Now that I can see my account I note that strong gains are showing from shares from the Argentina, Australia, the UK, Canada, Chile, Denmark, Finland, India, and Israel (plus the USA). The US stock is AT&T which was tipped today by Ben Reynolds on the moneyshow.com website, a fave of seekers of free advice.  Reynolds is a very young men with a beard to make him look more serious who owns and edits free monthly blog Sure Dividends, aimed at seniors. There is other news from Brazil, Hong Kong, South Africa, Ireland, and Switzerland, and a few other places which also are homes of declining shares.

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Equifax Mess

Sun, 2017/09/17 - 1:27pm | Your editor

Doing my tables today was a horror because my brokerage account locked me out although of course I know my password and my eldest child's middle name. So I decided it must be because of Equifax having allowed access to peoples' passwords and social security numbers. I cannot visit my local broker again until tomorrow when they open, and as a result the Monday blog will be late. If you just had a lazy Sunday you too may have a surprise logging into the sites you usually use.

Anyway, by dint of grit I got my tables up at www.global-investing.com more or less normally but without being able to check the market prices with a real borkerage account. Visit and be impressed by my ability to get information on the web.

More for paid subscribers follows. Join them and gain with our picks.

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The Drug Trade

Fri, 2017/09/15 - 1:14pm | Your editor

Brazilian prexy Michel Temer has been charged with obstruction of justice and racketeering over the giant meetpacker JBS tapes of conversations with him, but proceedings will require that the lower house of the Brasilia congress life his immunity. Since so many Brazilian pols themselves took bribes they may protect Temer to cover their own misdeeds. It is a national flaw among pols there.

 

Today's focus is on pharmaceuticals(AKA The Drug Trade)  so we begin with a development in the State of Maryland, MD. There the attorney-general is not wasting his time claiming that drug firms are peddling dope by how they present pain-killers to doctors (also MD's). Instead, the state is suing in a US Court in Baltimore to allow its aggressive injunction to identify and stop price hikes by drug-makers, particularly for older drugs where there is not much competition, like a single generic version. While several states are pushing for drug price controls, MD's is the most far-reaching.

Johns Hopkins University will find the price boosts when informed by drug stores, insurance companies, and Marylanders—because they are usually not told about them by the pharmaceutical company. There have been several egregious examples of price gauging, like the 6-fold price hike for the Epipen by Mylan or the 700%+ increase in the price of heart med Isuprel by Valeant Pharma 2 years ago.

Other generics producers argue that a state-by-state blockage of price rises risk creating disorder and that the necessary policy should be developed at the federal level, which is why the case is in court now. The focus of the MD statute being sued about is older generics drugs. It excludes new copycat drugs which generics makers market at much lower prices once they are off-patent, protected by the Hatch-Waxman act against more competition from other generics makers for 6 months. About 90% of US prescriptions are written for generics, but they only account for barely more than a quarter of the very high US level of spending on drugs.

The problem is that after the exclusive period ends, the free-for-all among generics makers can cause a huge price drop, so generic-makers cut their list of offerings. Because of pharmaceutical benefits programs and pharmacists working to cut the costs of drugs (for which they are paid!) generics are losing a lot of their former profits.

And if there are only a couple of versions of the drug on the market—or only one—price gauging is prossble. The US General Accounting Office last year said over 300 generics drug prices had doubled or more since 2010. Initially MD sought to limit price increases to merely 100% but after that Attorney-general Bruian Frosh removed that loophole, fearing it would encourage lots of generics companies doubleing the price.

Other states are also working on the price question, like Nevada, which wants to limit the price of diabetes medications. Ohio next year will have a ballot vote on whether drugmakers must give the state insurance body the same discounts as are offered to the Veterans Administration, which is a federal body. One of my daughters-in-law works as a senior researcher for the VA in Cleveland but did not contribute on this healthcare issue yet.

California voters last year defeated a drug pricing ballot initiative also using the VA discounts, but it now has been approved by both houses of the state legislature and awaits a ruling by Gov. Jerry Brown

 

More pharmaceutical news follows form Britain, Canada, Denmark, Finland, France, Germany, Holland, Hong Kong, Ireland, Israel, Italy, Mexico, South Africa, Sweden, Switzerland, and the USA.

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Catholic Theology and Splits

Thu, 2017/09/14 - 12:32pm | Your editor

I have to stop writing about is Catholic theology, according to a VA reader who studied it seriously. Apparently the secrecy of the confessional is needed in order to push sinners to stop doing whatever wicked things they get up to, and they are assigned a penance to push them to reform. The assumption is that they want to stop sinning, why their crimes are not reported to the cops.

This leaves a logical gap however: by the 2nd or 3rd or 4th confession of the same crime of sexually molesting children the carrot has proven to be useless and (being a real Old Testament type) I think a stick needs to be used.

My education in Catholic theology is spotty. When I was a kid, a friend of my father's who had gone to St John's to study law under the GI Bill used to teach it to me as a joke. His famous query was: “how many angels can stand on the head of a pin?” The answer is however many you want as angels are “immaterial”.

Speaking of religion, the Jewish year 5778 begins at Sundown on Sept. 20 and there will be no blog on the 21 but, because I am reform, I will write on Friday the 22. The holiday is held over two days because of uncertainty about when the new moon will appear. The Muslim calendar, also based on when the new moon appears, this year used the same date as the Jewish calendar in Indonesia and Malaysia, while the rest of the Muslim world in the Middle East, Europe, and the Americas will start the new year on Thursday at nightfall and on Friday. Shias mourn the new year working up to the death of Hussain Ali at Karbala on Day 10 while Sunnis are mostly feasting and feting the Prophet Mohammed's flight from Mecca to Medina to propagandize his new religion. They believe the 10th or Ashura is when Noah's ark landed and when Moses led the Hebrew children out of Egypt.

 

In addition to problems with telephones today I am locked out of my primary brokerage account. It doesn't accept the middle name of my daughter which I know for sure in order to change passwords and it doesn't recognize my voice on the cellphone as opposed to the landline.

 

More for paid subscribers follows from Brazil, Britain, Canada, China, Colombia, Germany, Israel, Mexico, Russia, Sweden, and The Netherlands Antilles. The big news concerns a split about which the market is getting very excited.

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Saint John Nepomucene and Warning Flags

Wed, 2017/09/13 - 1:07pm | Your editor

Since I first ran into him in a course in Eastern European history, my favorite Catholic martyr was St. John Nepomucene who in the 15th century was thrown off the Charles Bridge in Prague and drowned for refusing to divulge to the Emperor what his wife had said in her confession. Now I am reconsidering after it turned out that the secrecy of the confessional was cited by Australian Cardinal George Pell over priests who confessed to having sexually molested children.

An Empress having an affaire is a sin but not a crime or a violation of law (including canon law) whereas a prelate preying on children is a criminal. I am not sure if back in the 15th century this was spelled out by the Czech saint before he was dropped into the Vistula. So now I am backing Baltimore Archbishop William Lori who tonight will celebrate Mass for local “dreamers”, children who were illegally brought to the USA who have grown up and attempted to get proper papers.

One reason is that I ran into a demo over the weekend on behalf of the DAPA law that nobody in the party in power is backing, and got a lovely multi-lingual poster reading “welcome” in a dozen languages (French, Spanish, and what I assume is Arabic among them.) It was given to me by a pair of very tradional-looking nuns, wearing wimpels and carrying yard-long rosaries, presumably to increase their credibility if not their comfort level. I have no problem with propaganda for policies I back.

 

*The Frankfurther Allgemeine Zeitung today headlines” “A Financial Crisis Coming? The situation recalls 2006.” Then the paper quotes London-based analyst Ariel Bezalel of Jupiter Funds, who says “the biggest risks I see today are in the USA where consumer and corporate debt are too high... which also creates risk for the rest of the world.” Mr Bezalel managed the Jupiter Dynamic Bonds Fund which in 2012-2016 produced a 34.6% return compared to a mere 21.7% rise for other bond funds in Britain. He also worries about how easy it is for no-income companies like tesla or Netflix to raise money on the bond markets. The analyst also has a Jewish name which reporter Gerald Braunberger may not have spotted.

 

Bearish too is the European Securities and Market Authority which issued a warning that current market and credit risks are exceptionally high. This could cause a bubble and widespread volatility. It blamed low interest rates and political uncertainty over Brexit. Brexit talks are now being suspended until PM Theresa May delivers what is supposed to be “an important intervention.”

 

More for paid subscribers follows from Brazil, Britain, Canada, Chile, Denmark, Germany, Ireland, Israel, Italy, Korea, Portugal, South Korea, Spain, and The Netherlands. We have a new stock pick.

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