Harry Newton's In Search of The Perfect Investment
Technology Investor. Harry Newton
AM EST, Tuesday,
July 7, 2009. Finally Best Buy is dropping.
This thing has
got to drop below $20. Read this piece from The Wall Street Journal's Heard
on the Street:
habits die hard. At least that is the trend emerging among former Circuit
City Stores customers who have left specialty electronics stores behind.
A year ago,
Circuit City accounted for roughly 8% of sales at U.S. electronics and appliance
stores, according to Census Bureau estimates. But as bankrupt Circuit City
has shut stores, little of its business seems to have reappeared in the specialty
The Census Bureau's
estimate of electronics and appliance store sales -- which include Best Buy
-- fell just 0.9% in February. But they dropped an average of 11.2% over the
next three months. Overall retail sales declines actually narrowed slightly
over that time.
Best Buy's shopping
experience is similar to Circuit City's, with knowledgeable sales staff and
a wide selection. But price-conscious consumers are inclined to survey discount
stores and online retailers to find deals.
for instance, saw sales of electronics and general merchandise rise 38% in
the first quarter. Best Buy has increased revenue through store expansion,
but traffic has declined even after Circuit City's liquidation.
get a glimpse of Best Buy's fight for customers in June's Census Bureau data,
due July 14. If electronics-store sales don't improve, it may be hard to justify
paying 12 times this fiscal year's consensus earnings for Best Buy shares.
City's liquidation sales may have soaked up short-term demand for gadgets.
That would make way for better times at Best Buy this summer. But with customers
already leaking out of the specialty electronics sector, a recession is a
tough time to win them back.
on your prostate. From reader Dan Good:
to watch is the rate of change. If your PSA is 4 and it goes to 4.5, it may
not be a problem. But if it is 1.5 and goes to 3.0, a 100% change since the
last test may be a warning to get a biopsy even though it is under 4.
From reader Lucky
Marr, who, sadly, has prostate cancer:
it was nice
of you to share my little report...anything to encourage guys to pay some
attention to themselves...Had I known my older brother had gone through the
same procedure I did, I would have kept closer tabs on myself. Also, if you
recall Geoffry Marsh from TCA (Geoffry and I have been good friends for many
years) Anyway, he is the one that absolutely demanded (once I was diagnosed)
that I immediately go out and buy the "Prostate Cancer for Dummies"
book. Best investment I every made. That and the Internet helped me to understand
just what my problem was, what to expect and how to deal with it. I will always
be grateful to Geoffry for beating me over the head to get that book.
a lot? Try Tripit. It
helps you manage your travel. TripIt gives you real-time data, specifically
about flight delays and cancellations, and about finding alternate flights when
there are problems.
car rental tips. From reader Ron Acher:
From Pam Long in
book the cheapest, smallest, economy car you can find at any destination.
(These are the teaser prices you find on Orbitz to get you to book with them.)
They never have
it, so they will rent you whatever larger car they have, but they can't charge
you more than the rate for the car you booked.
all optional insurances. It's worth your trouble ten times over to be sure
you have equivalent coverage from other sources before you
arrive (and at the cheap places, bring proof).
And it is quite
correct that city rentals are much cheaper than airport. I paid 35% less doing
this just last month in San Francisco.
a vehicle in the Dallas, Texas make sure there is a toll tag sticker on the
windshield of your rent car. The Dallas Tollway is all automated now. No one
to take your coins. If the rent car has no sticker, then the rental agency
gets the bill. They upcharge it, then bill you for having been inconvenienced.
Could end up costing you many times the cost of a toll tag. i.e., $100's.
Better yet, stay OFF the Tollway at all costs.
Little digital cameras are cheap. Take photos of the vehicle before leaving
the lot and again when you return it.
Make sure features of the agency's parking lot are in the pics. Call the agency's
after hours number and let them know you have left the car in their lot. And
that you have taken photos of the car before you left. Heaven forbid I ever
need to turn in a rental car after hours. So far, I have never needed to.
I reserved the dinkiest car on the lot to drive 12 miles. When I arrived all
they had left was a Ford F250 truck. Yehaw! Got it for the same price as the
dinky car. YES!!!!!
measure of the M&A madness. The 133 leading German listed companies
have ( thanks to the M&A madness of the past few years ) accumulated $265
Billion in goodwill. This equals 44 percent of their capital. In the worst case
scenario this would half the equity ratio from 40 to just over 20 percent.
I Spent My Summer: Hacking Into iPhones With Friends. Neat piece
on how kids hack into Apple's iPhone in today's Wall
Street Journal. They're not the only ones. Many of my friends carry
hacked iPhones. To my tiny brain, it's a huge plus for Apple to have so many
intelligent people devote so much time
you old enough to remember him? Today's headline, "Robert S.
McNamara, Architect of a Futile War, Dies at 93."
Secretary of Defense Robert McNamara at a news conference at the Pentagon
From today's New
was the most influential defense secretary of the 20th century. Serving Presidents
John F. Kennedy and Lyndon B. Johnson from 1961 to 1968, he oversaw hundreds
of military missions, thousands of nuclear weapons and billions of dollars
in military spending and foreign arms sales.
Half a million
American soldiers went to war on his watch. More than 16,000 died; 42,000
more would fall in the seven years to come.
In 1995, he
took a stand against his own conduct of the war, confessing in a memoir that
it was wrong, terribly wrong.
one day, will write that Iraq and Afghanistan was wrong, terribly wrong. I wonder
who? George Bush?
I have no reason to doubt the accuracy of this story: I'm
surprised Mr. Mohsin agreed to be interviewed. I'm depressed that my tax dollars
are so flagrantly being pissed away.
Araz M. Mohsin, a struggling baker before the war, has become rich by working
with Americans in Iraq on construction projects.
July 5, 2009
Iraqi Seizes the Chance to Make War Profitable by Marc Santora of the
New York Times.
For most Iraqis, life after the American invasion has been a tale of loss:
loss of loved ones, loss of property, loss of dignity, loss of security.
But not for
Araz M. Mohsin.
A baker scraping
by when American tanks rolled into Baghdad, Mr. Mohsin recently spent $50,000
to throw a one-night bacchanal at the exclusive Hunting Club here. When guests
visit his second home, in Baghdad, he proudly shows off the two peacocks he
imported from Dubai, to join a menagerie of exotic birds that he sometimes
gives away to friends.
four cars, he said proudly. The Land Cruiser cost $80,000.
The car is parked
on a street still littered with debris and lined with blast walls from the
sectarian war that was fiercely fought in his neighborhood, Mansour. Fingering
his gold watch the one he is wearing costs $2,000; he reserves a $20,000
timepiece for big parties Mr. Mohsin said that only in
America, or an American occupation, was his story possible.
Every war has
its spoils, and while much has been written about the multinational corporations
whose profits soared as the battle raged, there are also hundreds, perhaps
thousands, of people like Mr. Mohsin.
There is no
suggestion that he did anything illegal, but in his description of the rise
of his business, the Future Company, it is possible to see writ small how
such vast sums of money from American taxpayers and the treasuries of other
countries could have been poured into Iraq with so little to show for it.
Even an American
contract for something as simple as hauling gravel has brought Mr. Moshin
tens of thousands of dollars.
The basic infrastructure
of the country is still a shambles, and with security remaining relatively
stable, Iraqs political leaders have turned their rhetoric to the evils
In May, the
trade minister was ousted and later arrested on charges that he used his position
to enrich himself. At least a half-dozen ministers may find themselves being
called before Parliament to answer questions about their own conduct. Prime
Minister Nuri Kamal al-Maliki has said there is a list of more than 1,000
public officials who could face corruption charges.
But other officials
point to Mr. Malikis inner circle as part of the problem.
A recent survey
by Baghdad University of 500 people found that 452 of them believed that the
office of passports and identity cards, run by the Interior Ministry, was
In this environment,
Mr. Mohsin makes no apology for making the most of the situation, offering
a variation on the 19th-century New York political boss George Washington
Plunkitts observation: I seen my opportunities and I took em.
Mr. Mohsin spent
the first three years of the war in hiding in the Kurdistan region, but by
2006, he decided to take a risk and work with the United States Army as an
I saw who worked with Americans, they made good money, he said.
Once on the
job, he wore a mask and, on one occasion, was beaten for his association with
Mohsin is Kurdish, he grew up in Baghdad and knew people on both the Shiite
and Sunni sides of the sectarian fault line.
he was stationed at an American base outside Baghdad and began to help the
Americans track down extremists, he said. My guys would come in and
they would tell me who was bad and who was not, he said. They
Mr. Mohsin still
proudly keeps the documents that prove that he worked for the Americans, but
it is impossible to verify the payments he claims to have received.
When his information
proved accurate or at least actionable the trust of the Americans
grew, he said.
two years working as an interpreter, he saw his chance to capitalize on his
connections. Mr. Mohsin was acquainted with some men from Ramadi, then a hotbed
of the insurgency, who knew how to navigate among the extremists. Those men,
who could operate in an area that no Western contractor would tread, would
become his business partners.
his work as an interpreter, he went back to the Americans, knowing they were
offering work, and he secured an $80,000 contract to supply gravel to the
American base, Al Asad.
$40,000 profit, he said. His cut was $15,000.
Seeing how lucrative
the contracts with the Americans could be, he formed his own company, bringing
in friends from Ramadi.
Over Pepsi and
chocolate cake at his house in Mansour, the décor of which could be
charitably described as frat-house chic, several of his partners sat and listened.
The men did not speak English and made it clear that even if they did, they
would not be talking much. Only Mr. Mohsin allowed his name to be used.
on the construction of a school a $75,000 contract paid by the Americans,
of which he claims $20,000 was profit he decided to push the envelope.
adventure, he said, smiling as he fed one of his parrots.
wanted someone to build a police station in Abu Ghraib, another no-go zone
for Western contractors. They were willing to pay $700,000 for the construction
of the station, which they named Victory and Peace.
a deal with the local leader of Al Qaeda in Iraq, Mr. Mohsin said. They
agreed not to destroy the station, and we promised to cut them in on the profit.
When the project
was completed, however, he gave the Qaeda leaders name to the Americans,
and the man was arrested, Mr. Mohsin said, adding that he kept the entire
He does not
know what became of the Qaeda leader, but Mr. Mohsin portrays the episode
as a good deal for Iraq and for himself. While he boasted of not being
afraid to walk the streets of Baghdad, his entourage, including his burly
business partners, is almost always at his side.
The money from
the Americans only got better. A contract to remove trash from
a base outside Falluja netted him $1 million, he said. It turned out what
the Americans considered trash generators, cables, air-conditioners,
furniture was actually perfectly usable and could be resold.
gave us a contract to deliver stone to a town near the Syrian border,
he said. The contract was worth $1.5 million, and Mr. Mohsin said $1 million
of that was pure profit.
But as the Americans
prepare to leave, he is unsure of the fate of the Future Company. He said
he was likely to leave Baghdad and return to his opulent home in Kurdistan.
the Iraqi government was proving difficult.
He did one job
for the government and has yet to be paid. They are very corrupt,
Mr. Mohsin said.
you avoid Airbus? The answer is generally NO.
For a sober assessment of the airbus and air travel, read
from this reasoned article are:
+ Dont fly
third world airlines. The Europeans have blacklisted 194 airlines. Here's the
+ Dont fly
+ Dont fly
into little places at night. They don't have proper lighting, proper radar and
+ An airplane pilot got engaged to two very pretty women at the same
time. One was named Edith; the other named Kate. They met, discovered they had
the same fiancee, and told him. "Get out of our lives you rascal. We'll
teach you that you can't have your Kate and Edith, too."
+ Two Eskimos
sitting in a kayak were chilly, so they lit a fire in the craft. Unsurprisingly
it sank, proving once again that you can't have your kayak and heat it too.
The day after his mother-in-law disappeared in a kayaking accident,
a Canadian man answered his door to find two grim-faced Mounties. "We're
sorry sir, But we have some information about your mother-in-law," said
Did you find her?" the anguished man sobbed.
The Mounties looked
at each other. One said, "We have some bad news, some good news, and some
really great news. Which do you want to hear first?"
Fearing the worst,
the ashen husband said, "Give me the bad news first."
The Mountie said,
"I'm sorry to tell you, Sir, but this morning we found your mother-in-law's
body in the bay."
"Oh my God!"
exclaimed the husband. Swallowing hard, he asked, "What's the good news?"
The Mountie continued,
"When we pulled her up, she had twelve 25-pound snow crabs and six good-size
lobsters clinging to her."
Stunned, the husband
demanded, "If that's the good news, what's the great news?"
The Mountie said,
"We're gonna pull her up again tomorrow!"
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,
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