In Search of the Perfect Investment

Hedging limits you. You get rich with one big bet. You don’t get rich with diversification or hedging, which is gambling that some things will go up and some will go down. Maybe you can pick bad things and pick goods things simultaneously. That’s hard. Though I kept you and me) out of commodities (except gold), wind, solar and banks in recent months (and I was right), I didn’t short them. So I didn’t profit by my “wisdom.” Stupid me.

Now I’m trying a little “hedging.”

Headline in today’s London Financial Times: Gloom returns as new disagreements appear over how to resolve crisis. Add that headline to the mess here and it’s a pretty gloomy time. Time to short the SPY — the ETF that tracks the S&P 500.

Here’s what it’s looked like over the past ten years. It’s where we started ten years ago. the Lost Decade.

Here’s the SPY this year. OK until August, when Europe started messing with our heads. then down.

Here’s the SPY yearsterday. Flukishly, I sold it short at $119.31 and $119.04.

By the end of the day, I was up a few shekels, though my Fidelity account shows I’m losing money (their silly accounting).

Gold has moved up a little and looks to me like a screaming buy, given the ongoing world economic mess. For example, my naive brain says you can’t solve a too-much debt crisis by borrowing even more debt.

The mortgage REITs — NLY, AGNC and ANH — are down, but still paying a high dividend yield, which suggests that they’re a sound buy.

The world is about as difficult to predict as it’s ever been. These daily gyrations are not good for the soul.

If agita bothers you, follow our  mantras:

When in doubt, stay out.

Cash is King.

I’ve bought some more muni bonds recently. Yields have fallen. But revenue bonds look safe, if anything does in today’s world.

Next Generation Remote Control Extender.This thing is god-sent. Imagine you hang your new flat screen TV. You bury all the electronics to it, including your CATV or DirecTV box, in a closet. The installation looks great. One wall, no wires. Great — except your infrared remote no longer works. It can’t “see” the box it’s commanding. Solution:

This $42 thing  has a wireless transmitter you insert in your CATV remote. It’s the shape of a battery. The saucer shaped thing is a wireless receiver. The little red thing sits in front of the eye on your CATV box and commands it with the infra-red signals it’s used to receiving from its normal remote. Get it from Amazon.

$50,000 of lap dances. The board of this high-techstart-up fired the previous CEO. My friend took over. He discovered  the previous CEO h took his people to four-star hotels, bought only the priciest wine — all at auction — and had spent $50,000 on lap dances, To finance this he used investor money. I asked my friend “Why?” His answer: “He was a pleaser. He wanted his people to love him.”

Many years back when I ran a real business,  a vendor bought me a lap dance. (My first and last.) I talked to the girls. I found two things;  First, they earned really good money. Many were mothers with young children.  They needed the money.  Second, 85%+ had  breast implants. I  felt sad about hte implants, knowing how dangerous they were (at that time).

The moral of this story is simple: When you invest in a company, you’re at the mercy of the nutcase running it. He/she can spendyour money in whatever way he wishes — and long before the board finds out  and fires him.

I’ve never heard of a woman CEO buying lap dances. But stranger things have happened. I googled “lap dance” this morning and found this charming image.

I must be truly sick to think this is funny.

QR Codes are neat. I small a huge opportunity here. This is a QR code:

Think programming a web site.  Once you could get rich designing the things.  Here’s a new opportunity. Here’s an explanation I wrote for the next edition of Newton’s Telecom Dictionary:

You find bar codes on products. Scan them at a supermarket checkout. The register knows how much to charge. Meantime, the supermarket’s back office computer collects information on which products are selling and re-orders them. QR (Quick Response) codes are different. They’re designed for use by consumers, i.e. you and me. The ones I’ve seen are typically 2 1/2 inches square and contain lots of black bars and squares. Actually they look remarkably like a pacman maze (without the pacman). It’s easy to create a QR code. You can display the resulting image on your web site, at your retail store, on your direct catalogs, etc. Once someone people scans your QR code using their smartphone’s camera and a free scanning software, the code will trigger whatever action you asked the code to do, such as: directing users to a website, such as adding your company’s contact information to the user’s address book, playing a video demonstrating the product, etc. I downloaded my free QRReader from Apple’s App Store and held it up to a QR code which I found a web site, called Buildings. Once scanned, my iPhone took me to a web page highlighting webinars which Buildings was running. Here’s more on QR codes from Buildings’ web site:

How Do I Do It? Creating a QR code is easy. Sites like qrcode.kaywa.com and beqrious.com offer free generators, though you will have to pay to add tracking analytics or order a custom design, which can run from a few hundred to a few thousand dollars depending on your needs. Codes generally aren’t the dominant element on a sign, but they can be sized as big or small as you want, says Jeff Hawthorne, co-owner of custom code designer BeQRious. “You want to be able to read it,” Hawthorne adds. “If you want to determine where the most traffic is coming from, go where the traffic is and test it yourself. I don’t like to make it any smaller than the back of a business card, but you can. Think about how to take advantage of that geographical space.” In addition to size, also consider the best place to post a code-bearing sign. billboards make little sense. No one in traffic will be able to scan the code, and the sign will be much too high for foot traffic. Window and monument signs in pedestrian areas and tabletop displays are great fits, however.

How Does This Benefit Facilities Management? This technology is far from being the sole property of marketing and advertising departments. Signs with QR codes have much to offer FMs too. For example, your portfolio may include restaurants, which are subject to regular health inspections. If you already have to display your inspection grade prominently, then why not add a QR code to show off the reasons why you earned that rating? New York City Mayor Michael Bloomberg recently announced plans to roll out such a system, allowing diners to read detailed evaluations and learn about any health violations before choosing where to eat.

Here’s another idea. We look at reviews before we buy a product, so why not go to your reviews? Internally, signage inside your building could feature a code that links to your email address or a job request form, letting other building occupants contact you instantly when there is a problem. You could pair these signs with a second set of codes for the FM staff’s use – for example, a code that notifies the rest of the FM team when a job is complete. You could even affix stickers with codes to each asset or piece of equipment. Link the code to a record of the item’s vendor, manufacturer, warranty information, and parts dealers to save your staff time when maintenance is needed. “Every business is different,” Jeff Hawthorne, owner of customer code designer, BeQRious, says. “For an insurance agency, it might be an online order form. A car dealership might want to prompt you to come in. The QR code is just as creative as you make it.”

My friend Todd Kingsley is having a colonscopy this morning. He complained all last night about the gallon of horrid stuff he had to drink to clean himself out.

To amuse him (and me) I found this photo on the Internet. I have not been able to stop laughing since.

Make sure you read the headline.

Rosh Hashanah, Jewish New Year, begins this evening.
On the morning of Rosh Hashanah as the congregation was filing into the sanctuary, Rabbi Feldman noticed little Jacob standing in the foyer of the synagogue staring up at a large plaque. It was covered with names with small American flags mounted on either side of it. The six-year old had been staring at the plaque for some time, so the rabbi walked up, stood beside the little boy, and said quietly, ‘Boker tov, Jacob. ‘

‘Boker tov, Rabbi Feldman,’ he replied, still focused on the plaque. `Rabbi Feldman, what is this?’ he said, pointing to the plaque.

The good Rabbi tenderly put his arm around Max’s shoulder and said, ‘ Well son, it’s a memorial to all the young men and women who died in the service. ‘

Soberly, they just stood together, staring at the large plaque.

Finally, little Jacob, in a voice barely audible and trembling with fear asked:

‘Which service, Rosh Hashanah or Yom Kippur?’

Buy Rosh Hashanah, sell Yom Kippur (ten days from now) – old Jewish stock market saying.

The three essences of a Jewish holiday.

1. They tried to kill us.

2. They failed.

3. So, let’s eat.

Harry Newton who is leaving tomorrow for two weeks in Vietnam, Cambodia and Laos. My next column will be Thursday, October 13. We have bought Global Rescue insurance, in case we get sick or injured.