Harry Newton's In Search of The Perfect Investment
Newton's In Search Of The Perfect Investment. Technology Investor.
8:30 AM Wednesday, November 9, 2005:
As more money sloshes around than there are real opportunities, Wall Street
responds with more and more new product, creations that often resemble betting
on two flies climbing a wall. The stuff that "sophisticated" investors
used to buy last year is now available for you and I. My simple rule on this
is: If you don't understand it, don't go near it. Item: Yesterday I received
a prospectus for a new "structured equity blind pool," which
contains such delicious quotes:
+ "Competing mezzanine and structured equity sources have lowered their
return hurdles in response to declining yields from alternative investments."
+ The fund "will be opportunistic."
+ And my favorite:
"The General Partner is expert in managing opportunity and risk, investing
in value-added opportunities and creating value through intensive management."
goes the economy?
asked a friend in the wholesale office products supply business "What
are your dealers telling you about the economy in general and their businesses
in particular?" His answer:
is good with no signs of slowing down. Usually, office products are a leading
indicator of a slowdown or pickup. No signs of a slowdown at present.
Robert Samuelson asks why are Americans so confident at the shopping
mall and so glum in opinion polls? His answer. We were confident in the
1990s because we were building "The New Economy" --
the Internet, technology, strong tech stock prices, etc. Now, the tech bubble
has burst, the housing bubble looks like bursting, we have huge trade and budget
deficits, and now inflation... In short, plenty to worry about. But the reality
is that we are richer. Gains from homes have more than offset our losses on
stocks. And per capita income has grown almost 9% from 1999 to 2004.
As to where the
stockmarket is going? Remember it predicts what the economy will do nine
to 12 months out. And right now it seems to be saying it's "steady
as she blows."
The key is to
find an area that is about to be "hot." Ride it and get out quickly.
In recent months this happened with flu stocks, i.e.
Now, it's happened with the housing stocks. After Toll Brothers -- the top U.S.
luxury-home builder -- yesterday warned of ebbing demand, the listed home builders
took another dive. Check how much they're off their year's high:
Don't be a customer of Wall Street. Be an insider:
From the London Observer,
by the standards of hedge fund managers, it's a bonanza. UBS is set to reward
employees at its new hedge fund unit with an unprecedented $1 billion in
The Swiss banking
giant is understood to have guaranteed the huge sum in a bid to recruit and
retain star traders and fund managers, and grab a share of the currently booming
market in alternative investments.
in the summer that it was creating Dillon Read Capital Management, a hedge
fund business, which will start work in the new year. Now The Observer
has learnt that the new unit, run by former UBS head of investment banking
John Costas, will be assigned a $1 billion bonus pool to cover the first three
years of its existence.
This means that
each of Dillon Read's 120-strong workforce will be in line for an average
bonus of nearly $3 million a year. In practice, the average bonus among
fund managers and analysts should be even higher, since the 120 employees
are understood to include back-office staff. ...
strategy is partly designed to discourage the Swiss bank's best traders from
leaving by emulating the famously generous pay structure of independent hedge
funds, and comes in spite of poor recent returns at some funds.
To the Finish
From a recent issue of the New York Times:
dumb can you be?
since installing Norton AntiVirus on my Windows .. computer, I cannot defragment
my hard drive because the Disk Defragmenter program never finishes. What can
your computer's hard drive, sometimes called ''optimizing'' the hard drive,
can help improve your PC's performance because it internally reorganizes the
way files are stored on the hard disk so the operating system can find and
use them more quickly. (What looks like a single file on the screen may actually
be made up of several ''fragments'' stored in different locations on the hard
drive, and defragmenting the drive puts everything back together in one place.)
open, running and writing new data to the hard drive while Disk Defragmenter
is working can interfere with its ability to operate, though, and may cause
it to run endlessly. Even if you close all your regular programs, like your
Web browser and e-mail program, the antivirus program is still probably running
in the background...
You might try
opening the antivirus program's settings and turning it off manually while
you run Disk Defragmenter. Symantec, the company that makes Norton AntiVirus,
recommends restarting the computer in Safe Mode before running Disk
Defragmenter or ScanDisk, Microsoft's other built-in Windows utility for hard-drive
One way to
get into Safe Mode is to restart the computer and hold down the F8 key
until a text menu appears on screen that gives you the option of using Safe
Safe Mode looks
different from your regular Windows desktop, and your monitor resolution may
look a bit odd, but you can run Disk Defragmenter and other Windows utility
programs. You will need to restart your computer to get out of Safe Mode and
back to your normal Windows system.
This amused me: After a year of negative publicity, Tom Cruise has sacked his
publicist. In a year that saw the 43-year-old get engaged to girlfriend Katie
Holmes and star in the critically-acclaimed War Of The Worlds, 2005 should have
been a great 12 months for the actor - but instead he attracted a stream of negative
headlines. Amongst other things, he was was criticized for saying Brooke Shields
should not take anti-depressant drugs and the Cruise and Holmes engagement was
accused of being a publicity stunt -- since both of them had new films to promote.
The man should keep his mouth closed.
Being totally unfair to France:
Q. How do you say hello in French?
A. "I Surrender."
Q. How many French
soldiers does it take to defend Paris?
A. Don't know, it's never been tried.
Q: How do you
confuse a French Soldier?
A: Give him a rifle and ask him to shoot it.
Q: What's the
motto of the French Army?
A: Stop, drop, and run!
Q. What do you
call 100,000 Frenchmen with their hands up?
A. Their army.
Q: What do you
call a Frenchman advancing on Baghdad?
A: A salesman.
Q: Why do the
French call their fighter the *Mirage*?
A: Because it doesn't really exist.
Q: What do you
call a man who only needs body armor on his back?
A: Jacques Chirac
the new French flag look like?
A: A white cross emblazoned on a white background!
been in hospital? You'll love this.
A woman called a local hospital. "Hello. Could you connect me to the person
who gives information about patients. I'd like to find out if a patient is getting
better, doing as expected, or getting worse."
The voice on the
other end said, "What is the patient's name and room number?"......"Sarah
Finkel, room 302."
you with the nursing station."
Station. How can I help You?"
"I'd like to know the condition of Sarah Finkel in room 302."
"Just a moment.
Let me look at her records. Mrs. Finkel is doing very well. In fact, she's had
two full meals, her blood pressure is fine, to be taken off the heart monitor
in a couple of hours and, if she continues this improvement, Dr. Cohen is going
to send her home Tuesday at noon."
The woman said,
"What a relief! Oh, that's fantastic... that's wonderful news!"
The nurse said,
"From your enthusiasm, I take it you are a close family member or a very
I'm Sarah Finkel in 302! Nobody here tells me diddlelee......."
+ Dumb reasons we hold losing stocks. Click
+ How my private equity fund is doing. Click
+ Blackstone private equity funds. Click
+ Manhattan Pharmaceuticals: Click
+ NovaDel Biosciences appeals. Click
+ Hana Biosciences appeals. Click
+ All turned on by biotech. Click
+ Steve Jobs Commencement Address. The text is available:
Click here. The full audio is available. Click
+ The March of the Penguins, an exquisite movie. Click
+ When to sell stocks. Click
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
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