Harry Newton's In Search of The Perfect Investment
Newton's In Search Of The Perfect Investment. Technology Investor.
8:30 AM EST, Friday, November 23, 2007: Markets
will bounce back a little. That's what today's early futures portend and on
overseas markets yesterday which weren't closed for Thanksgiving. But, as I've
written before, "Do not be fooled by bear market bounces, which are
often violent, and short-lived."
was my fortieth Thanksgiving
in the U.S., my adopted country. I have a lot to be thankful for. Health, family,
wealth. The usual suspects. Thank you. Thank you. Thank you. The only sad note
is that on my first Thanksgiving the Vietnam war was raging. Now 40 years later
we have another war -- one that's already lasted longer than the Second World
War and killed and maimed too many young wonderful Americans. I pray one day
we'll learn not to invade other's people's countries -- especially ones that
pose no threat to us.
about Canadian oil sands:
Canada has more oil than Saudi Arabia. Canada's oil is not as cheap to mine
as Saudi's. Canada's costs about $30 a barrel -- but that's a profitable business
with oil selling for close to $100 a barrel For a very fascinating article on
the Alberta tar sands, you must read "Unconventional
Crude" by the New Yorker's Elizabeth Kolbert.
Why I don't like financial stocks. They
smell too much like cockroaches. Anyone who thinks all the bad loans have been
written off is smoking something. From today's New York Times:
Billion in Write-Offs Is Predicted
22 - Losses in the distressed mortgage sector of the United States could reach
$300 billion, only a portion of which has so far been accounted for
by write-offs at major banks, according to a study released on Thursday by
the Organization for Economic Cooperation and Development.
institutions, including Citigroup, Merrill Lynch and Swiss Re, have estimated
losses of about $50 billion, but the O.E.C.D. cautioned that a rougher
period may yet await financial markets, which have swooned in recent days
as traders try to calculate the impact of mortgage-sector losses on the overall
based in Paris, is an international organization that helps governments with
economic, social and governance issues. In particular, mortgage resets - the
point at which the interest rate on a loan shifts upward to reflect current
borrowing costs - have not peaked, but will probably do so next May, the organization
said in the report.
have not hit the worst point in resets, delinquencies and ultimate losses
on mortgages," it said.
The group estimated
the losses based on a 14 percent default rate on subprime mortgages, high
by historical standards but entirely plausible under the current circumstances,
economists say. Losses on subprime loans - those made to the least creditworthy
borrowers - would cost lenders $125 billion, the organization said.
so-called Alt-A mortgages, ones given to people with better credit but still
not high-end, the organization concluded that an overall loss level of $300
billion looked feasible.
The loss numbers
reflect not just the value of the mortgages but also the total cost to lenders
of a bad mortgage, once they have foreclosed on and sold the house to recoup,
presumably, at least part of their losses. But, the organization said, much
will depend on how banks react - or are forced to react - to future defaults.
Banks and other
investors are exposed to the mortgage market through securities backed by
housing loans. The problem in financial markets could force write-offs far
in excess of what actual defaults turn out to be.
if they can hang on until the American housing market bottoms out and allows
a fuller picture of what losses are, economists say, those losses can probably
be absorbed with relatively little shock.
important variable the markets are facing right now is time," said Adrian
Blundell-Wignall, an economist who worked on the study for the organization.
"Time is what lets you get out of jail in this case."
pounded stocks far afield of the financial sector in recent days as traders
debated the risks of a broader hit from the credit crunch. If the worst situation
were to occur, banks would constrict lending to the rest of the economy.
So far, most
hints have been anecdotal, but nervous markets already feel compelled to discount
the prospect in share prices, traders said.
of the times.
Roger Federer and Pete Samprass are playing three exhibition matches
in Asia. Two have been played in Seoul Korea, Kuala Lumpur, Malaysia.
The last one will be played this evening late at 1:00 AM and a repeat
tomorrow evening (Saturday) at 8:00 PM.
You'll find the match on the Tennis Channel, which is 217 on DirecTV.
prize money:: $35,640,078
prize money:: $43,280,489
cruise you missed -- be thankful. From Bloomberg this morning:
The cruise ship
``M/S Explorer'' evacuated 154 passengers and crew after hitting heavy ice
and taking on water in the sea off the coast of Antarctica. The passengers
and crew were moved to lifeboats then boarded another ship and are safe, said
Susan Hayes, an executive at Toronto-based tour operator G.A.P. Adventures.
The company owns the ship, she said. ...
and first officer stayed on board the ship after the passengers and other
crew were evacuated, and Hayes said she didn't have information about whether
they were safe.
G.A.P. was offering
a 10-day trip on the Explorer starting Nov. 29 from Ushuaia, Argentina, then
winding through the Drake Passage to the Antarctic Peninsula and South Shetland
Islands. The cost was $4,895. "`Experience a voyage of a lifetime to
land where penguins rub shoulders with seals and orcas and whales are often
seen plying the icy waters,'' the G.A.P. Web site says.
describes itself as Canada's largest adventure travel company.
Maid asked for a raise.
The Madam was very upset about this and asked: "Now Maria, why
do you want an increase?"
Maria: "Well Madam, there are three reasons why I want an increase. The
first is that I iron better than you."
Madam: "Who said you iron better than me?"
Maria: "The Master said so."
Madam : "Oh."
Maria: "The second reason is that I am a better cook than you."
Madam: "Nonsense, who said you were a better cook than I?"
Maria: "The Master did."
Maria: "My third reason is that I am a better lover than you."
Madam (very upset now): "Did the Master say so as well?"
Maria: "No Madam, the gardener did."
She got the pay
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.
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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
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