In Search of the Perfect Investment

I hate UPS and other Peter Lynch lessons

+ They rip off casual users (like me).

+ Their web site is awful. For example, 25 years later, they still can’t figure that I’m in America. This is what I see every time I log on. I select the United States, again and again.

+ And now they tell me that I have a package coming next Wednesday:

The package is not coming. It’s going. I sent it to my son, Michael.

Why does UPS tell me it’s coming to me?

I’m happy I don’t own the stock.

However I’m not happy I missed Best Buy.

A reader, T. Fenton, wrote:

Harry,

Not all retail is going down the drain.

How could you’ve missed Best Buy (BBY)? Against all odds sales have surged, stock is up 86% over last 12 months, dividend 2.3%.

Maybe it’s gone unnoticed in NYC but Best Buy’s in-store selection and pricing, replicated on its website, plus on-site and after-sales service is making all the difference.

Check ‘them out. Remarkable turnaround based on customer service and availability of latest technologies.

There’s a lesson here: Peter Lynch said buy stocks whose products (and services) you buy and like.

We have a gigantic Best Buy 3-story store around the corner. I go in there occasionally to see “What’s new?” or to buy a cable I need. The cable is always over-priced — until I show them what Amazon sells it for (About a third of the price).

I often read about new techie products I desire. But I can never check them out at Best Buy. They never have them. They seem to cater to poor people who have limited tastes.

But, my reader says they’ve improved. I’ll pop by today. I suspect that Best Buy’s shares are now way too high. They’ve spiked big-time. Look at my chart.

Now we move to Alibaba (BABA). They’re not my favorite company to deal with. But I do own BABA and I’ve been recommending them in my list — see the column of “Stocks, ETFs and Funds we like and own” on the right on the web site (but not in the email).

Look at this:

Nice pick Harry. By the way, Aliaba found the vendor for me in China for the products I was looking for. And the vendor is delivering, finally.

Kleptocracy or “business” as usual?

As reporters ramp up their research into the Trump and Kushner businesses and charities, more and more stories emerge of greed, deception, double dealing and, in the case of the Kushner real estate empire, just plain desperation.

Last week I did a piece “World’s most expensive tear-down. And the tangled web of the Kushners, the Kremlin and the Russian bank.” Click here. Some of my predictions are coming true, viz this Bloomberg report:

Kushner Companies Seeks $250 Million Loan

Kushner Companies, which is owned by the family of Jared Kushner, son-in-law and senior adviser to Mr. Trump, is looking for $250 million to repay the backers of a Jersey City apartment tower that was financed by Chinese investors.

Kushner Companies spent about $225 million to build the luxury building, called Trump Bay Street, in which Mr. Kushner maintains a stake.

It financed the project with about $190 million in loans, including $50 million through the so-called EB-5 visa program, which gives foreign investors preferential treatment in obtaining permanent residency if they invest at least $500,000 in American development projects.

Kushner Companies must repay a $140 million construction loan from CIT Group, which is due in September.

It also wants to pay off its EB-5 loans, which are all from Chinese investors, even though the loans are not due for several years.

Kushner Companies’ refinancing plans were reported earlier by Bloomberg News.

With all the horrible press and the tie-ins to Donald, who will lend the Kushners $250 million? Would you? Maybe a nice Russian bank? But only if the sanctions are removed.

 Now comes a long investigative article from Forbes magazine reporters:

How Donald Trump Shifted Kids-Cancer Charity Money Into His Business

Here are a few quotes from the Forbes piece:

IN ORDER TO understand the Eric Trump Foundation, you need to understand the Donald J. Trump Foundation. The president was never known for giving his foundation much money, and from 2009 to 2014, he didn’t give it anything at all. Outsiders still donated, though, allowing Trump to dole out their money to a smattering of more than 200 charities as if it were his own, with many of the donations helping his business interests. …

Katrina Kaupp, who served on the board of directors at the Eric Trump Foundation in 2010 and 2011, also remembers Donald Trump insisting the charity start paying its own way, despite Eric’s public claims to the contrary. “We did have to cover the expenses,” she says. “The charity had grown so much that the Trump Organization couldn’t absorb all of those costs anymore.” The Trump Organization declined to answer detailed questions about the payments. But it seems that for the future president, who Forbes estimates is worth $3.5 billion, a freebie to help his son directly fight kids’ cancer took a backseat to revenue.

“I saw that Eric was getting billed,” Gillule adds. “I would always say, ‘I can’t believe that his dad is billing him for a charitable outing.’ But that’s what they wanted.”

It’s also very consistent. The Donald J. Trump Foundation famously acted like an arm of the overall business, using the charity’s money to settle a Trump business lawsuit, make a political donation and even purchase expensive portraits of its namesake. Meanwhile, Trump businesses billed the Trump campaign, fueled by small outside donors, more than $11 million to use his properties, chefs and private aircraft.

For the entire fascinating Forbes magazine story, click here. 

Pertinent cartoon?

What happened with my web site yesterday, and why your email messed up.

My web site runs on the most popular web software in the world called WordPress. More than a million sites use it, including the New York Times, The Wall Street Journal and 27% of the Internet, according to WordPress’s own web site, click here. 

WordPress is open source, meaning that thousands of software developers write “plug-in” software to enhance WordPress. One brilliant plug-in is called Subscribe2, written by Matthew Robinson in England. It handles subscriptions (adding and deleting them) and mailing out my blog.

You find plug-ins for lots of software, from browsers (like Chrome and Firefox) to WordPress. The key to getting them to work flawlessly together is making sure the plug-in is updated when the main software is software is updated. We have this problem with Windows (and Mac OS). When the operating system is updated (say from Windows 7 to Windows 10), old software — the software you love — may no longer work. And that’s what happened here.

But it’s now fixed. Thank you Matthew.

For those you who receive an emailed version of this newsletter, you should get today’s blog.

If you didn’t read yesterday’s blog (which was interesting), it’s here. 

The lesson of all this::

+ Don’t let any software automatically update itself. (I make an exception for Apple iPhone and Watch software. That stuff is a closed world, with Apple itself making sure things work.)

+ Always check that your old, favorite software will work on the updated software — before you install the updated software.

+ If it works, don’t mess with it. Now you know why I’m sticking with Windows 7 (for now).

Harry Newton, who warns against taking unsolicited calls from brokers and salesmen for investment bankers. More about this later.

Back to watching Comey and Roland Garros, the French Tennis Open. The finals will be this weekend, probably on NBC. And definitely repeated on The Tennis Channel.