In Search of the Perfect Investment

Investing can be seductive. A hot tip. A quick rise. And, bingo, you’re rich beyond your wildest dreams.

Nonsense.

The reality is investing’s a lot of work. You have to fish around for the “facts,” do your thinking and then make a decision.

The worst part is when the answer is NO. I’ve just wasted all that time and ended with nothing. Better to have played tennis, or gone for a walk.

Getting to a NO is why this column is regularly empty of brilliant suggestions.

My friends are wary of hard times in the second half, and maybe even harder in 2013. The euro is now $1.24 and probably going even lower.

A JPMorgan trader is probably short the euro and long the American dollar. But that’s such an obivious trade. I don’t understand forex.

The stupidest thing I ever did was to invest in someone else’s ideas or business.

Cash has its charms for now, though I still do like many shorts. See below.

JPM’s $2 billion trade loss is blossoming to $5 billion, according to Business Insider, which reports “JP Morgan CIO’s Former Risk Manager Had A Terrible Record As A Trader.” For the full story of the trader whom I wouldn’t hire to run a queue for an outhouse, click here.

Carl Icahn has bought into CHK? Should I? I sold it short, then covered when I heard Icahn had bought in.This is the chart:

I didn’t go long after the Icahn news, because it was “too hard.” I followed my rule, “When in doubt, stay out.” Business Insider has this:

Bloomberg’s Tara Lachapelle, Jim Polson and Joe Carroll report at least one sell-side research group has declared the embattled natural gas developer an attractive buyout target.

SunTrust Robinson Humphrey Inc said that, “While a buyer would have to cope with seven joint ventures and $13.1 billion of debt, Exxon Mobil Corp. and Chevron may see a chance to scoop up the largest holder of onshore drilling leases before gas prices rebound, said SunTrust Robinson Humphrey Inc,” they write.

Meanwhile, Reuters’ Michael Erman reports this morning Chesapeake management will meet with its lenders this week to discuss its $9 billion to $10 billion funding shortfall.

For the full story, click here.

Miracles happen. I bought a TV at best Buy last night. I learned:

1. Best Buy is a nightmare. They can’t sell you half the TVs they have on display. They don’t have them in stock. Their saleschildren’s product knowledge is abysmal.  It takes too long to buy anything. I compare my Best Buy shopping experience to my Apple store experiences. It’s night and day. Best Buy is still an excellent short. (For others, see yesterday’s column.)

2. There are two types of TVs — smart ones and dumb ones. Smart ones do all the Internet and 3D stuff. Dumb ones don’t. Smart ones cost a lot more. I bought a dumb one.

3. There are real differences in technology. You want one with high refresh rate and a broad contrast ratio.

4. LED sets seems to look best and weigh the least, which makes them easy to hang.

5. It makes sense to buy the biggest set you can place. For family viewing, a 55 or 60 inch is best. I put a 32 inch set on my desk. I sit less than three feet from it. It’s great for watching tennis.

6. Samsung makes the best LEDs.

7. HDMI is the interface of choice between your cable/FIOS box and your TVs.

8. You can run two TVs, using an HDMI splitter. Both TVs obviously will see the same program.  Amazon has a cheap $20 one. Click here.

My friend Ed called this morning:

Ed: “I just returned from staying at my friend’s lavish condo at Canyon Ranch in Miami.”

Harry: “It’s good to have rich friends.”

Ed: “Better than being rich. You avoid the taxes.”

So true, from the latest New Yorker

Harry Newton who wonders why so many of his friends do so little exercise and eat so much.