Tables Posted

Sun, 2012/11/04 - 11:53am | Your editor

The tables on www.global-investing.com have been posted. You should log in to see the ones you qualify to view or download: closed positions for pre-subscribers, and current stock, bond, closed-end and exchange-traded funds for paid subscribers. More follows soon for the privileged paid-up members but first an correction about something I mis-reported from the crucial state of Ohio, from my daughter.

"Cleveland Heights rescheduled trick or treating for Sunday evening, not Wednesday. The City of Cliveland has cancelled trick or treating altogether. The news was this morning's Metro lead. We expect a large influx of Children from Cleveland looking for candy anywhere they can find it."

I presume supporters of both presidential candidates are figuring out ways to make the parents aware of the strings attached to their largesse by also handing out propaganda to take home with the goodies.

 

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My Mayor Writes

Fri, 2012/11/02 - 12:41pm | Your editor

Here is the word from my mayor, Mike Bloomberg:

“The floods and fires that swept through our city left a path of destruction that will require years of recovery and rebuilding work. And in the short term, our subway system remains partially shut down, and many city residents and businesses still have no power. In just 14 months, two hurricanes have forced us to evacuate neighborhoods -- something our city government had never done before. If this is a trend, it is simply not sustainable.

“Our climate is changing. And while the increase in extreme weather we have experienced in New York and around the world may not be the result of it, the risk that it might be -- given this week’s devastation -- should compel all elected leaders to take immediate action.

“But we can’t do it alone. We need leadership from the White House -- and over the past four years, President Barack Obama has taken major steps to reduce our carbon consumption, including setting higher fuel-efficiency standards for cars and trucks. His administration also has adopted tighter controls on mercury emissions, which will help to close the dirtiest coal power plants, estimated to kill 13,000 Americans a year.

“Mitt Romney, too, has a history of tackling climate change. As governor of Massachusetts, he signed on to a regional cap-and-trade plan designed to reduce carbon emissions 10% below 1990 levels. “The benefits (of that plan) will be long- lasting and enormous -- to our health, our economy, our quality of life, our very landscape. These are actions we can and must take now, if we are to have ‘no regrets’ when we transfer our temporary stewardship of this Earth to the next generation,” he wrote at the time. He couldn’t have been more right. But since then, he has reversed course, abandoning the very cap-and-trade program he once supported. This issue is too important. We need determined leadership at the national level to move the nation and the world forward.

“I believe Mitt Romney is a good and decent man, and would bring valuable business experience to the Oval Office. He understands that America was built on the promise of equal opportunity, not equal results. In the past he has also taken sensible positions on immigration, illegal guns, abortion rights and health care. But he has reversed course on all of them, and is even running against the health-care model he signed into law in Massachusetts.

“If the 1994 or 2003 version of Mitt Romney were running for president, I may well have voted for him because, like so many other independents, I have found the past four years to be, in a word, disappointing.

“In 2008, Obama ran as a pragmatic problem-solver and consensus-builder. But as president, he devoted little time and effort to developing and sustaining a coalition of centrists, which doomed hope for any real progress on illegal guns, immigration, tax reform, job creation, and deficit reduction. And rather than uniting the country around a message of shared sacrifice, he engaged in partisan attacks and has embraced a divisive populist agenda focused more on redistributing income than creating it

“Nevertheless, the president has achieved some important victories on issues that will help define our future. His Race to the Top education program -- much of which was opposed by the teachers’ unions, a traditional Democratic Party constituency -- has helped drive badly needed reform, giving local districts leverage to strengthen accountability in the classroom and expand charter schools. His health-care law -- for all its flaws -- will provide insurance coverage to people who need it most and save lives.

“When I step into the voting booth, I think about the world I want to leave my two daughters, and the values that are required to guide us there. The two parties’ nominees for president offer different visions of where they want to lead America.

“One believes a woman’s right to choose should be protected for future generations; one does not. That difference, given the likelihood of Supreme Court vacancies, weighs heavily on my decision.

“One recognizes marriage equality as consistent with America’s march of freedom; one does not. I want our president to be on the right side of history.

“One sees climate change as an urgent problem that threatens our planet; one does not. I want our president to place scientific evidence and risk management above electoral politics.

“Of course, neither candidate has specified what hard decisions he will make to get our economy back on track while also balancing the budget. But in the end, what matters most isn’t the shape of any particular proposal; it’s the work that must be done to bring members of Congress together to achieve bipartisan solutions.”

 

Many present-day Republicans to advocate “killing the beast” by cutting taxes and deficits to keep government intervention from excess, because of our national taste for independence. But when an overwhelming need arises, only Washington has the ability to respond to a disaster: National Guardsmen helping evacuate flooded towns; Army jeeps to get through the waters and sand; funding for massive reconstruction of our local transport systems, airports, and railways; pumps for our tunnels; the money to keep bus-drivers, firemen, policemen, ambulance and medical personnel, and (even) sanitation men on the job earning overtime pay; convoys to bring water, food, electric generators, and gasoline where it is needed; official buildings put to use as temporary shelters for those driven from their homes; backup communication and radio to keep in touch with the victims.

Private sector help is also being mobilized. Charities are working flat out with the sick, the evacuated, the survivors, the needy, the hungry. Every large bank open in the city is offering shelter, cellphone and Internet links, and bathrooms to the newly-homeless. But this help is sporadic and not co-ordinated. In the end, it is the federal government, and the much-abused FEMA (which Mitt Romney wanted to turn over to the states or the private sector in the run-up to his nomination) to which we turn.

Apart from Mayor Bloomberg's new taste for Obama, I can cite New Jersey Gov. Chris Christie's change of heart about Big Government. This is the same Governor who refused stimulus money three years ago for the NY-NJ Port Authority for building a new (and needed) rail tunnel under the Hudson River because it was “too expensive”.

My personal view is that individual responsibility is important to Americans, but when overwhelmed by weather disasters--or illness or untimely deaths or even unemployment--most of us want help to be available.

More from Canada, Israel, Britain, and Colombia today. For the first time since the storm my Internet is proving dodgy today.

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The Narrows

Thu, 2012/11/01 - 1:38pm | Your editor

Today the market is taking heart from a better Chinese purchasing manufacturers' index survey result, this one official, showing a result over 50, signaling growth. The PMI is 50.2 up from 49.8 last month. Unfortunately the private sector PMI survey published 2 weeks ago showed a rise but one leaving the level short of the 50 which marks GNP growth. As a regime turnover moves into place, there are incentives to expand the economy and create a feel-good mood.

It is significant how much Chinese money is being invested not just in emerging markets raw material production, but in developed countries like Australia, Canada, and the USA, and even 10% of London's Heathrow Airport. If they spend abroad they cannot also spend within China.

Hallowe'en was a bit of bust because of the sequels of Sandy. Our building staffs' kids did not turn up from outlying suburbs. So only the “blessed” Sutton Place kiddies said: “trick or treat”. Even the famous gay Hallowe'en parade in the West Village was canceled because there was no electricity to dress and make up by.

What NYC needs is a Thames barrier, but I am not sure it is technically possible. We are much closer to the sea than central London. When ships made it across the Atlantic they tended to head for the nearest landing, as we saw also in Santo Domingo. Heading up the river a bit was too much to impose on desperate sailors. Are The Narrows which lead from NY Bay to the NY Harbor narrow enough for storm barriers? There is a bridge between Brooklyn and Staten Island across The Narrows, the Verrazano, the longest US suspension bridge.

Your editor, when she was in the 4th grade, won the "Know Your City" contest and was interviewed on the radio and met Henry Steele Commager. I have taken a boat to the Thames Barrier in London which is pretty impressive. If we elect a president willing to fund infrastructure investment (even if it is paid for by tas-free or taxable bonds issued by the Port Authority of NY-NJ), this would be a good stimulus project. I bet Gov. Chris Christie would support it, although there is not much that can be done to protect the Jersey Shore giving onto the Atlantic Ocean. 

We finally got all the newspapers today. So there is more from Australia, Britain, Israel, Singapore, Spain, Canada, and Brazil. And maybe a few other places as well like Japan and China.

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We're Blessed

Wed, 2012/10/31 - 12:23pm | Your editor

We are without heat or hot water or subway but otherwise fine. I heard from family and friends as far away as London and Bangkok and Trinidad (many of whom never email) with concerns. Thanks to you all. I also heard from Scandalous Sandy, a first cousin who married an Italian-American Catholic, gloating about what damage her namesake storm performed to her home town. She was born July 4th.

Our marketing man, to whom we outsource promotions, is without juice in CT and the webmaster in Newfoundland is awaiting the rump of the storm. Be patient. People a mere mile south of our “blessed Sutton area” (words of my simpering neighbor Julie, a real estate agent) are without power. There are thousands of uprooted trees. The subway and tunnels are flooded. It will be a while before life is back to normal.

Staffers at my building slept in their break room on the floor or in their cars. The supermarket checkout lady told how she had grabbed a cab in The Bronx, picked up her boss, and headed for work on 56th street. We depend on these people. So do the 1%.

Now back to work with lots of news from three days of hiatus. Then Hallowe'en, the New York Marathon, and Election Day await. We have good news and bad. The best news is that the amateur army of US short-sellers were kept from moving markets over the past two days (unless they are global operators and moved their tricks and treats abroad).

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Sandy Underwhelms

Mon, 2012/10/29 - 12:26pm | Your editor

So far Sandy has underwhelmed. If there was a market I would load up with insurance companies and reinsurers. But of course I can't.

It may all just come down to Katrina-phobia. The wind is high; the water level in the East River (the spur of the Long Island sound I can see from our apartment) is high. The keening of the wind and the occasional siren of an ambulance are the only sounds from the street. There is almost no traffic on the Queensborough Bridge. With markets closed and reports being delayed by our companies, there is little to write about from the Sandy Storm City today.

Governors and Mayors don't risk much by over-reacting. If the storm peters out they can simply say that they we protecting the citizenry.

My corporate bank, Chase, has waived fees for overdrafts for customers in NY, NJ, and CT until Weds. I wonder what I can buy?

All in all, if the rush to the supermarkets yesterday throughout the East Coast affected region is anything to go buy, the economy will actually get a boost unless Hurricane Sandy proves deadly and destructive. Back when I was a kid, a very destructive hurricane hit my neighborhood in northern Manhattan, taking down street signs and traffic lights, as well as many trees. It flooded Broadway and Dyckman Street (the main drag in Inwood) near where we lived. We had no warning at all. I think we are better off this way.

If the stock markets remain shut in there will be no blog tomorrow. More news from our companies follows from India, Brazil, Israel, Finland, Colombia, Mexico, Spain, Britain, and Canada.

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Tables Posted

Sun, 2012/10/28 - 12:39pm | Your editor

As people around me batten their hatches to prepare for Hurricane Sandy, which improbably bears the name of my cousin who moved two years ago from Florida to North Carolina to get away from the hurricanes, I have posted my tables.

Wall Street will probably be discombobulated Monday as the storm hits.

You can view the tables on www.global-investing.com, three for paid subscribers, and one for those thinking about subscribing. There are no new trades for this week yet, because of the weather warning, but there were three last week.

There is one bit of news, pink-sheet traded Global Income Fund, GIFD, which I sold because it is changing its business to become a US self-storage REIT, not something that would fit our portfolio mandate, is doing a 1:4 reverse split Nov. 5 to make trading and administration cheaper in the transformation period. Its ticker symbol will remain the same for now but its cusip becaomes 37934Y207. It remains the USA champion in discount from net-asset value, of 20%.

You will get post-split  only book-entry non-certified shares. You also may get capital gains or losses from fractional shares being sold.  These may explain the rise in the discount.

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Why I Won't Own Baidu

Fri, 2012/10/26 - 11:46am | Your editor

From Kroll and the Economist Intelligence Unit, news about fraud in international investing: "The proportion of companies that suffered an incident [was] 61% in the current survey. Fraud is anything but defeated, with the most common frauds, theft of physical assets and information theft (reported by 24% and 21% of companies respectively), remaining stubbornly persistent and widespread.

"Anti-corruption measures are reaping rewards. Companies are making gains through robust efforts to combat bribery and corruption. Half of our respondents have monitoring and reporting systems to assess risks on an ongoing basis; train their senior managers and other representatives to become familiar and compliant with the US Foreign Corrupt Practices Act and UK Bribery Act; and include a review of these laws in their due diligence, when considering an acquisition, joint venture or providing financing."

In one of my past lives, I worked on a US Senate Foreign Relations Subcommittee for Clifford P. Case (R-NJ) which wrote and passed the Foreign Corrupt Practices Act despite some business opposition.

Meanwhile there is a new focus in fraud crackdowns, in case you missed the New York Times article between the nanny murders and the surprising rise in US GNP in the 3rd quarter (up at a rate of 2% annualized, from 1.5% in Q2, and sharply higher than economists' forecasts of 1.8%)

The focus of the latest expose of obscene profits is the family of Chinese Premier Wen Jiabao, whose members managed to accumulate at least $2.7 bn in personal financial wealth during his term of office in the People's (haha) Republic of China. Three generations of Wen clan members benefited from extreme access to government funding, normally confined to state-owned companies, and from Asian tycoons, in sectors ranging from insurance to recycling, from private equity to diamonds.

China reacted by blocking access to New York Times websites. The Great Wall of China stops its netizens from viewing news Beijing doesn't want them to see, why I won't own Baidu.

Reuters meanwhile reported that Huawei tried to sell to Iran cellphone tower systems incorporating antenna equipment made by its USA partner Andrew LLC in violation of US sanctions.

Dealing with China is not a matter only of fighting currency manipulation and copyright violations.

 

The latest report on how Global-Investing.com is performing for investors, by Hulbert's Financial Digest, says we had a raw return of 21.8% in the past 12 months, vs 29.9% by the Wilshire 5000, a broad US index. Mark Hulbert compares newsletters to the Wilshire, even if they are invested wholly outside the US. We also fell short over 3 years, producing gains of 8.7% vs the Wilshire's 13.2%. However, we beat the index over 5 years (at 3.3% vs 1.4%) and over 10 years (at 17.4% vs 8.7%.).

Since I do not hedge currencies this is mostly a matter of comparing apples to oranges. You can view the tables Mark prepared on our website where we post the, or buy the full profile via Dow Jones' Marketwatch.com

 

More for paid subscribers follows from Israel (unusual for a Friday when Tel Aviv is closed for the Moslem Sabbath), Britain, South Korea, Finland, Norway, and Canada.

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Never Again Stocks?

Thu, 2012/10/25 - 1:01pm | Your editor

The weakness in stock markets these days is compounded by two trends. Short-term, we are seeing more disappointing quarterly results than ones which beat estimates. Short-term means this will reverse. The same is true of the dreaded “fiscal cliff”. As President Obama said in the last debate, something will be done before the economy goes over it. That is short-term too.

More significantly and more long-term, we are also seeing a panic over risk in stock markets globally, fed by the numbers. You can sum up the negativism by what people are saying: “I tried stocks and lost all my money. I will never buy stocks again.”

Alas, there is no way middle class people can educate their kids or finance their retirement at the rates of interest you get these days from bonds. Using your house as an ATM will not work any longer. Defined benefit pensions are going the way of the dodo while government programs like social security are running out of money.

Now the mounting cost of private university education is part of what is going wrong for the middle classes, and learning that my Alma Mater, Harvard, managed to lose on endowment investments in its last fiscal year is not reassuring. The failure of both candidates to seriously address the need for reforms of pensions (and taxes!) fosters bad outcomes. What will replace Obama care if it is repealed is unknown.

The only answer for people planning for financial needs down the road is to invest in equities. Many of the shell-shocked folks now buying bonds or leaving their cash in the bank are not otherwise going to be able to get enough return on their money to achieve their life goals.

While buying indexes through exchange-traded funds or Vanguard can idiot-proof a stock portfolio from high-risk speculation, IPO chasing, or over-concentration (on tech, say), you do better with individual share picks. We only cover the rest of the world but there are plenty of good analysts covering US shares. To help you, I can give you a referral to a trusted US equity manager I use for my company's profit-sharing and pension plans.

 

Your editor has been designated as a finalist in the 2012 TraderPlanet STAR (Superior Trading and Resource) Awards contest. Thanks to CA reader PGH for nominating me. You can vote for me at www.TraderPlanet.com/star-awards/nominate (as the finalist link is not yet active.)

 

One of my readers--from Texas, not China or Kirghistan or Khartoum—sent several messages warning me not to vote for Obama or I will “suffer the consequences above”. But there is nothing above the message from RH. Does this means the TX reader's computer has been hacked? or mis-hacked?

Facebook keeps sending me “friend requests” in Chinese and I cannot read them; if you want to be my friend, visit www.global-investing.com and subscribe!

My desktop caught a computer virus (despite McAfee) two weeks ago and I had to get my local Iranian techies to do a clean my C drive reinstall. The internet in increasingly insecure. I am now nearly on track thanks to them and questions about subscriptions or credit card payments will be soon be answered. Apologies for the delay.

 

To clear up ambiguity, Marta Hernandez and her Mar Sala band sang a cool skat-flamenco version of “Los Cuatro Muleros”, the Spanish folksong, at the Instituto Cervantes in NYC last week. It was first transcribed by Federico Garcia Lorca. Helped by Eduardo Garcia of sentidocomun.co.mx, I wrote a new version commenting on the current Euro crisis.

Yes to readers LM and JS, there was an earlier parody, “Los Cuatro Generales”, a Republican Spanish Civil War song by Ernst Busch about the four Fascist armies surrounding Madrid. The generals were Franco, Sanjuro, Mola, and Queipo de Llano. It was sung by the Almanack Singers (and Pete Seeger).

 

More of those disappointing quarterly results follow from Brazil and Spain along with news from Britain, Israel, Canada, Finland, and Norway.

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China Purchasing and Hockey Sticks

Wed, 2012/10/24 - 1:53pm | Your editor

China's purchasing manager index for mid-October remains in the red, at a level below 50% which means wholesale orders are contracting, at 49.1%. However, the level is much better than that of last month, which was 47.9%. So it's off to the races again in global stock markets.

As our paid subscribers know, we positioned ourselves for the Chinese growth recovery with a share purchase days ago. More on that below.

The latest Republican candidate Senate election gaffe was by Indiana's Richard Mourdock, who said in last night's TV debate that if a pregnancy results from rape, it is because “God intended” this, and an abortion would violate God's will. So would in vitro fertilization according to Catholic theology. More on this below.

There is other good news today too. My city is getting an ice hockey team, which will be housed in the new Barclays Center in Brooklyn, the former Long Island Islanders. (Brooklyn and Queens are also on Long Island but they are part of the Big Apple.) This too is terrific news for one of our stocks. And another share which has been barely traded now has good news.

More for paid subscribers follows from China, Japan, Canada, Israel, Britain, Spain, Belgium, Greece, Finland, and Scotland.

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Al Rio

Tue, 2012/10/23 - 11:32am | Your editor

With thanks to Marta Hernandez and her Mar Sala band, whose performance last week reminded me of the old Andalusian song, and for editing by Eduardo Garcia of Sentidocomun.co.mx here is my commentary on the EU crisis:

De los cuatro muleros

De los cuatro muleros

De los cuatro muleros

Angelita mía

Que rescan los bancos

Que rescan los bancos.

 

Y de la mula torda

Y de la mula torda

Y de la mula torda

Angelita mía

Es el Mariano

Es el Mariano.

 

No me he equivocado

No me he equivocado

No me he equivocado

Angelita mía

Es el Camero(n)

Es el Camero(n).

 

Our cousin's son Tom Rothwell reports from southern Spain that after the floods he no longer has to walk through mud and river cane from his cortijo (farmhouse) to get to the river (where the muleteers in the original song were going). Instead, he has a 20 ft high stone ledge he can jump into the river from like a swimming pool diving board. He was luckier than most Andalusians.

More follows from South Korea to Israel, from Canada to Australia, from China to Finland, from Spain to Brazil during another bad-hair day for stocks because of earnings disappointments. We managed to avoid two of them.

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