Harry Newton's In Search of The Perfect Investment
Newton's In Search Of The Perfect Investment. Technology Investor.
8:30 AM EST Monday, May 15, 2006: The
Mothers Day weekend was positively wonderful. Michael and Claire came in. We
caught up on gossip and took family photo as presents for Grandpa's 90th birthday
coming up next month. This morning I'm off to give a 12:30 luncheon talk at
the River Centre in downtown St. Paul. Come by if you're in town.
What you learn from your kids: Life moves much faster today than
it moved for you and I. This has good points: There are far more alternatives
these days. This has bad points. You got to be on your toes making decisions
fast. The overwhelming lesson is that old expression: when God closes a door,
she opens a window. Lots of them. It's hard not to be envious. Make sure your
kids know they're living in a truly wonderful world.
presumption of "fair" pricing. I checked the local propane
providers for our weekend home in upstate New York. The most expensive was 50%
more than the cheapest. But he had provided our tank and delivered his expensive
gas whenever he figured we needed it. For our new house, we're buying our
own, bigger thousand gallon tank. We'll negotiate one delivery a year with
people can be so stupid. Part 1:
The story begins:
"Late one afternoon
in June, 2001, John W. Worley sat in a burgundy leather desk chair reading
his e-mail. He was fifty-seven and burly, with glasses, a fringe of salt-and-pepper
hair, and a bushy gray beard. A decorated Vietnam veteran and an ordained
minister, he had a busy practice as a Christian psychotherapist, and, with
his wife, Barbara, was the caretaker of a mansion on a historic estate in
Groton, Massachusetts. He lived in a comfortable three-bedroom suite in the
mansion, and saw patients in a ground-floor office with walls adorned with
images of Jesus and framed military medals. Barbara had been his high-school
sweetheart—he was the president of his class, and she was the homecoming queen—and
they had four daughters and seven grandchildren, whose photos surrounded Worley
at his desk. Worley scrolled through his in-box and opened an e-mail, addressed
to “CEO/Owner.” The writer said that his name was Captain Joshua Mbote, and
he offered an awkwardly phrased proposition: “With regards to your trustworthiness
and reliability, I decided to seek your assistance in transferring some money
out of South Africa into your country, for onward dispatch and investment.”
Mbote explained that he had been chief of security for the Congolese President
Laurent Kabila, who had secretly sent him to South Africa to buy weapons for
a force of élite bodyguards. But Kabila had been assassinated before Mbote
could complete the mission. “I quickly decided to stop all negotiations and
divert the funds to my personal use, as it was a golden opportunity, and I
could not return to my country due to my loyalty to the government of Laurent
Kabila,” Mbote wrote. Now Mbote had fifty-five million American dollars, in
cash, and he needed a discreet partner with an overseas bank account. That
partner, of course, would be richly rewarded.
Mbote’s offer had the hallmarks of an advance-fee fraud, a swindle whose victims
are asked to provide money, information, or services in exchange for a share
of a promised fortune. Countless such e-mails, letters, and faxes are sent
every year, with a broad variety of stories about how the money supposedly
became available (unclaimed estate, corrupt executive, and dying Samaritan
being only a few of the most popular). Worley, who had spent his adult life
advocating self-knowledge and introspection, seemed particularly unlikely
to be fooled. He had developed a psychological profiling tool designed to
reveal a person’s “unique needs, desires and probable behavioral responses.”
He promised users of the test, “The individual’s understanding of self will
be greatly enhanced, increasing the potential for a fulfilled and balanced
life.” And Worley was vigilant against temptation. Two weeks before the e-mail
arrived, he had been the keynote speaker at his eldest granddaughter’s graduation
from the First Assembly Christian Academy in Worcester, Massachusetts. He
cautioned the students about Satan, telling them, “He’s going to be trying
to destroy you every inch of the way."
For the whole
story, which you must read, Click
How people can be so stupid. Part 2: What ever
happened to the fortune Michael Jackson Made? From this Sunday's New York
For the full story,
SEATED in a
$9,000-a-night luxury suite in the sail-shaped Burj Al Arab hotel in Dubai,
Michael Jackson played the role of a wealthy pop star as he met with two senior
executives of the Sony Corporation last December. From the opulent setting
to Mr. Jackson's retinue of advisers, there was little indication that Sony's
troops were paying a visit because they were concerned that he was teetering
on the brink of bankruptcy proceedings.
The Burj Al Arab hotel, Dubai, UAE.
Sony was worried
because Mr. Jackson was the company's partner in a lucrative music publishing
business that included songs by the Beatles and other musicians. If Mr. Jackson
became insolvent, his 50 percent share of that $1 billion business would be
up for grabs to the highest bidder, leaving Sony to confront the uncomfortable
possibility that it would be forced into a new, unpredictable partnership
not of its own choosing.
With the waters
of the Persian Gulf and a teeming, prosperous emirate splayed out far beneath
them, the group got down to business. According to those who attended the
meeting and requested anonymity because confidential financial matters were
discussed, Mr. Jackson was pensive and cooperative, seemingly well aware of
the gravity of his situation despite the grandeur of his surroundings. He
only chirped up occasionally to remark on what a wonderful investment the
catalog had been.
to Mr. Jackson, Robert S. Wiesenthal, a senior Sony executive, eventually
proposed that Sony would help the singer find a bank to lend him more than
$300 million to pay off his debts. In exchange, Mr. Jackson would possibly
forfeit a portion of his half of the Beatles catalog.
Just last month,
Mr. Jackson still swamped in debt, with his musical career in stasis
and his personal life limned by scandal agreed to that financial overhaul.
It is likely to strip him of about half of his remaining stake in the catalog,
which he has relied on as a financial lifeline for about a decade. According
to executives involved in the restructuring talks, Mr. Jackson used the catalog,
as well as copyrights to his own songs, as collateral for roughly $270 million
in bank loans he took out to fund a spending spree that includes upkeep for
his sprawling California ranch, Neverland, and other exotic luxuries.
GM worth $40? I thought GM was going to $15.
So far, I've been wrong. Now there is talk of it going to $40. Here's
its recent price chart:
it's going to $40. (This is not a game I'm playing, however.) His logic:
price of flash memory is plummeting. I just bought a 2 gig card for
my Canon SD-450. I paid what I paid a year ago for a 512 meg card -- less than
$50. My camera will now take 1378 photos per card, up from 355. Enough for an
entire round the world trip. Amazing.
believe General Motors can do it. The skeptics just won't relent. That Bank
of America sell rating reiteration was beyond stupid. Here's the deal: I think
that when we look back at this era, Kirk Kerkorian's representative Jerome
York is going to be perceived as the man who did it again. I know many people
continued to bet against him when he came on board with IBM. Back when I was
running my hedge fund, we had the opportunity to talk to the guy, and we covered
our short and went long after the meeting. Then he figured out how to fix
Chrysler and sold it for a fortune.
Now he is in
the mix with GM. Don't forget, the cars aren't the problem; that's a Ford
(F:NYSE - news - research - Cramer's Take) issue. GM's cars sell. The balance
sheet, long a horror, is now good. The GMAC offload gives GM a chance to get
a credit upgrade, which allows it to lower its borrowing costs.
that "No. 1" carmaker mantra is history. That's really important,
because it is much better to be a large company that is profitable than to
be the largest company that is losing money.
York comes in. Chrysler and IBM were all about trying to be the largest, damn
the profitability. York, no egomaniac, rightsized those firms. That's what's
happening to GM.
that when everyone else figures this stuff out, the stock will be at $40.
what this means for Whole Foods? (Probably
not bad for results, but not good for its stock price.)
boil water in a microwave oven: It can become
"superheated" and explode when moved.
Raunchy but wonderful.
A little boy goes to his dad and asks, "What are Politics?"
Dad says, "Well
son, let me try to explain it this way:
1. I'm the head
of the family, so call me The President.
2. Your mother is the administrator of the money, so we call her the Government.
3. We're here to take care of your needs, so we'll call you the People.
4. The nanny, we'll consider her the Working Class.
5. And your baby brother, we'll call him the Future.
"Now, think about that and see if it makes sense."
So, the little
boy goes off to bed thinking about what Dad has said. Later that night, he hears
his baby brother crying, so he gets up to check on him. He finds that the baby
has soiled his diaper.
So, the little
boy goes to his parent's room and finds his mother sound asleep. Not wanting
to wake her, he goes to the nanny's room. Finding the door locked, He looks
in the keyhole and finds his father in bed with the Nanny. He gives up and goes
back to bed.
The next morning,
the little boy says to his father, "Dad, I think I understand the concept
of politics now."
The father says,
"Good, son, tell me in your own words what you think politics is all about."
The little boy
replies, "The President is screwing the Working Class, while the Government
is sound asleep. The People are being ignored and the Future is in deep shit."
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
click on my email address. You have to re-type it . This protects me from software
scanning the Internet for email addresses to spam. I have no role in choosing
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