Harry Newton's In Search of The Perfect Investment
Newton's In Search Of The Perfect Investment. Technology Investor.
8:30 AM EST, Tuesday, December 11, 2007: Our
guest bathroom has nowhere to hang your coat. Yesterday I bought a coat hook.
It cost $33.60. It was brushed nickel and gorgeous. But $33.60 for a hook on
the backside of a bathroom door! Think of the hook as microeconomics.The
door is part of our new house. Think
of the whole house as macroeconomics. The budget on that -- when it was conceived
three years ago -- was a generous (so I thought) $250 a square foot. It's coming
in at $450 -- an 80% increase. Think of the house as the macro-economic view,
made up of little views -- like a doubling in steel prices in the last two years
50% increases in wood, and skyrocketing nickel prices (which have actually dropped
wife, who can't distinguish between my heartfelt bitching and my curious commenting,
says "Suck it up. This is the world we live in." Despite my
claims to our family's uniqueness, I suspect we're the same as everyone else
-- spending wildly in favor of the good life. Which brings me to China. India.
Russia. Brazil. (The ultra-economic picture.) They're all getting richer at
breakneck speed. Which means more demand for:
Commodities. My broad commodity fund is up 17% this year.
magic seeds. You must read this week's BusinessWeek.
And what a stock ride:
3. More demand
4. More demand
for meat. There's a new ETF called (I kid you not) COW, which tracks livestock
prices. About 70% of the security is held in live cattle and about 30% is in
lean hogs. For more, read Jonathan
planning NOW: Sell some
of of your losers. Apply ordinary losses to ordinary gains. Give
it to Uncle Sam or give it to your kids or your charities. Or just plonk some
money into a donor-advised fund and figure which charity you want to give to.
You can also pay for school/college tuition, dental, and medical expenses (including
health insurance premiums) of family members or friends. When paid directly
to the providers of those services, these payments are exempt from both gift
tax and generation-skipping tax, regardless of the amount you spend. You can
give up to $12,000 each year to as many recipients as you would like without
incurring a gift tax. Spouses can combine this annual exclusion to jointly give
$24,000 to any person tax-free. Annual exclusion gifts must be complete (that
is, received and, in the case of a check, either deposited or cashed) by December
strategy to consider to help decrease estate taxes is to reduce your net worth
by making lifetime transfers to family members. Separate from the annual exclusion,
current law specifies that you can give away $1 million ($2 million for married
couples) before a 45% gift tax applies. The challenge is to pack as much value
as possible into that lifetime exemption amount. GRAT that results in no taxable
gift, or at least a very nominal one, so that there is no exemption wasted if
the asset do not perform as you hoped. For both the GRAT and the FLP, tax laws
are currently quite favorable. However, these benefits may disappear in the
guise of reform in 2009.
I stole most the
above words from a document I can't publish. Suffice, it's authoritative. There
are plenty of things you should do NOW to save on your taxes for 2007. Remember
the federal estate tax is scheduled to disappear altogether in 2010 (a good
time to die) and spring back full-blown) in 2011 unless Congress acts sooner.
I don't see it going away permanently. The Democrats have convinced themselves
that only rich people pay it (about 2% of all estates). And the Republicans
will need the money.
grass is greener on the other side: Switching
employers. Switching wives. Switching brokers. Switching usually doesn't work.
I don't know the stats. Figure 83.2%. The problem, as my father would say, "lies
in your own backyard." And, of course, the ONE determining factor
of your net worth is divorce. All the acrimony of divorce makes the lawyers
richer and the participants poorer. It's sad to watch.
men shouldn't take messages:
to live by
+ Never, under
any circumstances, take a sleeping pill and a laxative on the same night.
+ If you must
choose between two evils, pick the one you've never tried before.
+ If you look
like your passport picture, you probably need the trip.
By the time you can make ends meet, they move the ends.
+ There is a
very fine line between "hobby" and "mental illness."
+ Your friends
probably love you anyway.
This column is about my personal search for the perfect
investment. I don't give investment advice. For that you have to be registered
with regulatory authorities, which I am not. I am a reporter and an investor.
I make my daily column -- Monday through Friday -- freely available for three
reasons: Writing is good for sorting things out in my brain. Second, the column
is research for a book I'm writing called "In Search of the Perfect
Investment." Third, I encourage my readers to send me their ideas,
concerns and experiences. That way we can all learn together. My email address
is . You can't
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