Fees are skyrocketing
Be wary: Funds of all types and sizes. Syndications. Alternative investments, etc.
Fees are the reasons assets get sold quickly. IRR is time sensitive. It looks better the less time you hold the asset. You can take a higher fee when the IRR is higher.
Fees are the reasons assets never get sold — as the manager enjoys his 2% total fund fee. And gets paid by the company he invests in — a mind-blowing conflict of interest But, amazingly, not illegal.
Harry’s love: Stay with index funds and index ETFs and individual stocks.
And don’t read the noise. Here’s noise from the Sunday Times in England:
I couldn’t find the article on the Sunday Times web site. But it sure reads like the author missed out on buying Amazon, which is up $6.81 today as I write this. Here’s one of his sentences in the article:
” Since its float in 1997, the stock (i.e. Amazon) is up 1,000-fold and it remains perhaps the most successful public company in performance terms in the past 25 years.”
He continues
“Nevertheless, it won’t necessarily be possible to replicate this gargantuan achievement.”
But that shouldn’t stop us looking… 5G, AI (artificial intelligence), fin tech, cannabis, bitcoin, energy…
Boeing has been horribly managed for a long, long time
Management’s focus was on stock price, not safety. Here’s ten years.
Here’s how it was done. From today’s Wall Street Journal:
Over the past six years, Boeing has spent $15.7 billion on research and development, and $43.4 billion on stock buybacks. Is that a sign of misplaced priorities? Buybacks aren’t necessarily evidence of short-sightedness. But in Boeing’s case, they are part of a bigger picture. You can read our deep dive into Boeing’s swoon this morning, here. The author, Dan Catchpole, argues the company’s problems were two decades in the making.
Catchpole’s article is headlined:
The forces behind Boeing’s long descent
A shareholder-first culture fueled the 737 Max crisis. Now it may keep the aerospace giant from recovering.
Catchpole’s article in Fortune is illustrated with this photo:
Caption on the photo reads: Earthbound: The 737 Max crisis has forced Boeing to suspend the deliveries of hundreds of commercial planes, while hamstringing its efforts to design new products.
The article begins:
For nearly a year, the world’s largest aerospace company has been engulfed by a scandal of its own making. The 737 Max crisis, which unfolded after 346 people died in two crashes linked to software malfunctions in Boeing’s newest jetliner, has put the company under an unforgiving lens. Scrutiny from journalists, crash investigators, regulators, Congress, and the Department of Justice has exposed profound flaws in Boeing’s corporate culture—shaking its workforce, forcing supplier layoffs, and shattering fliers’ trust.
What’s more, the Max scandal isn’t the only dire threat to Boeing’s trajectory. Well before the crashes, Boeing had struggled to plug a gaping hole in its product lineup between its single-aisle 737 and larger twin-aisle 787 planes. Now, plans to launch an entirely new, “clean sheet” jetliner for this midsize market have been shelved, as the company scrambles to get the Max back in the air.
You can read the rest of Catchpole’s article here.
Over the weekend, CNBC ran a story headlined:
Today the New York Times ran a story:
How Boeing’s Responsibility in a Deadly Crash ‘Got Buried’
This is the photo leading the story:
Credit…Ade Johnson/Agence France-Presse — Getty Images
The story begins:
After a Boeing 737 crashed near Amsterdam more than a decade ago, the Dutch investigators focused blame on the pilots for failing to react properly when an automated system malfunctioned and caused the plane to plummet into a field, killing nine people.
The fault was hardly the crew’s alone, however. Decisions by Boeing, including risky design choices and faulty safety assessments, also contributed to the accident on the Turkish Airlines flight. But the Dutch Safety Board either excluded or played down criticisms of the manufacturer in its final report after pushback from a team of Americans that included Boeing and federal safety officials, documents and interviews show.
The crash, in February 2009, involved a predecessor to Boeing’s 737 Max, the plane that was grounded last year after accidents in Indonesia and Ethiopia killed 346 people and hurled the company into the worst crisis in its history.
A review by The New York Times of evidence from the 2009 accident, some of it previously confidential, reveals striking parallels with the recent crashes — and resistance by the team of Americans to a full airing of findings that later proved relevant to the Max.
You can read the full story here.
Wikipedia writes on the Comac C919:
The Comac C919 is a narrow-body twinjet airliner developed by Chinese aerospace manufacturer Comac. The development programme was launched in 2008, production of the prototype began in December 2011, it rolled out on 2 November 2015 and the aircraft’s maiden flight was on 5 May 2017. Its first commercial deliveries are expected in 2021 to China Eastern Airlines. The aircraft, primarily constructed with aluminium alloys, is to be powered by either CFM International LEAP or ACAE CJ-1000A turbofan engines, and be able to carry 156 to 168 passengers in a normal operating configuration up to 5,555 km (3000 nmi). It is intended to compete primarily with the Boeing 737 MAX and Airbus A320neo. As of 31 August 2018, Comac has 1008 commitments including 305 firm orders, mostly from Chinese leasing companies or airlines, with the exception of GE.
Conditions couldn’t have been worse.
That’s what the people at Geopolitical Futures said as they put this chart together.
Miraculously, The Australian Tennis Open is on. Melbourne is 16 hours ahead of East Coast time. So it’s hard to see live matches. But there are plenty of great matches on ESPN2 and The Tennis Channel.
From the web site, ATPTour.com,
Roger Federer tries to be a good tennis parent. He mostly stays out of the way when it comes to teaching his children about the sport he’s played for a living the past 22 years.
But every now and then, the six-time Australian Open champion leans in and offers a bit of advice. The suggestions, however, even coming from Federer, sound wrong.
“They don’t always listen to me. I play with them sometimes. I do like to play with them. But I am not the biggest fan of the dad giving them all the advice. For that I think they got to listen to the coach. I’ve had that problem before, where I told them some things, and they said, ‘Well, my coach told me differently’.”
“I told them, ‘There you go. Listen to the coach. Don’t listen to me. But at least listen to one of us.’”
Most of my friends don’t like Bill Maher.
He doesn’t like Trump. But he is funny. And this piece from his HBO TV show Real Time With Bill Maher is very funny.
Sorry for all the stuff on Boeing.
It reinforces one of my key philosophies — You are your own worst enemy. No one can shoot you in the foot as effectively and with great precision as you can.
Nasdaq is up today. The Dow is down. Technology (i.e. Nasdaq) is where the growth is.
I’ll be back tomorrow — Harry Newton
Oops I forgot. Can you believe there are still people wasting their time making predictions of things no one can predict?
++Search Everything++ works fabulously.
I pray MS doesn’t acquire them.
Smooth operation and fun watching.