Technology Investor 

Newton's In Search Of The Perfect Investment. Technology Investor. Previous Columns
8:30 AM Wednesday, April 27, 2005: The stockmarket remains the place not to be. There are occasional bright spots (such as Google). But finding them is too hard. Think pushing a heavy boulder up a hill. Every so often, the boulder falls back and crushes you (e.g. Taser, Verizon, Research in Motion, AIG, Berkshire Hathaway). Today's headline earnings news is dismal -- Sony's net loss widens, Amazon's net falls 30%, Siemens profits are down 35%. Better to play tennis, paint the house, spend time with the kids, or God forbid, pay attention to your own business. Figure a way of being super-nice to your customers.

There are four keys to making the perfect investment.
(At least today).

First, developing a deal flow. You can't be in them, if you can't find them. And since you want to be in the best ones, you have to figure out how to find them. All my friends in the real estate have worked with (also called trained) their brokers

Second, you have to train your nose to say "NO" quickly and "YES" slowly. You say NO fast to save time. There's nothing more painful than listening to a bad entrepreneur rattle on endlessly about his latest bad idea. You have to say YES slowly to allow yourself time to do the due diligence

Third, don't ever take your friends' recommendations without checking them out. If you've been reading this column, by now you know more about choosing an investment than all your friends. The best source of money-losing deals are friends.

Fourth, doing your allocations is key. You don't want ever to give more than you can afford to lose to one project. Avoiding large losses has to be your key goal today. This is contrary to what every major Wall Street firm and every manager of your money says, namely Buy-and-hold. You cannot buy and hold in today's markets. Cash remains king. Clip this chart. It shows how hard it is to dig yourself out of a hole.

Amount of Loss Incurred
Return Required
To Break Even
Good Luck

Why Buy and Hold doesn't always work:
Check out the Taser boulder. Hairy, eh?

Now you know why the original investors in Google are selling many of their shares...

My best idea ever. My optometrist calls it "self-prescribing." I'm a high myop. That means I'm short-sighted. I can't see distance. When I go to my eye doctor, he gives me glasses that let me see distant mountains clearly. This is useless, since I spend most of my time looking computer screens 2-3 feet away. I self-prescribed. I now have three sets of glasses -- one for reading, one for computer screens and one for driving (seeing mountains). Most of the day, I wear my computer glasses.

I continue to like real estate: Read my piece yesterday on my friend who made a quick million. And now the government reports that sales of new homes rose sharply by 12.2 percent in March and hit a record annual pace of 1.43 million. Today, I'm putting some money into a syndication and loaning some money on another development in Coachella Valley. My loan is backed a first trust deed and personal guarantees from the wealthy developers.

Technology works. The New York Times today reported on a old rape case that just got solved with DNA. Said Robert M. Morgenthau, the Manhattan district attorney, "It ought to send a chill through a lot of defendants to know that after 32 years you can still test for DNA."

I'm no a doctor, but...if you're using Viagra, Cialis or Levitra, stop instantly if you have high blood pressure. The Journal of Neuro-Optalmology reports that 14 men taking these drugs have developed an eye problem that can cause blindness. The problem is NAION. Of the 14, seven had high blood pressure and three had pre-existing eye problems. If you have NAION in one eye, stop using these drugs instantly, if not sooner. NAION stands for nonartheritic ischemic optic neuropathy. It's nasty.

From today's Washington Post:

Actors pretending to be patients with symptoms of stress and fatigue were five times as likely to walk out of doctors' offices with a prescription when they mentioned seeing an ad for the heavily promoted antidepressant Paxil, according an unusual study being published today.

The study employed an elaborate ruse -- sending actors with fake symptoms into 152 doctors' offices to see whether they would get prescriptions. Most who did not report symptoms of depression were not given medications, but when they asked for Paxil, 55 percent were given prescriptions, and 50 percent received diagnoses of depression.

For the full article, click here.

Ringtones is a billion dollar a year business. I don't get it. Why anyone would want to spend money to download music to play when your cell phone rings? Especially when your cell phone already comes with zillions of ring tones? What do I know? The ring tone business is a $1 billion a year business world-wide. And it's growing. It now includes "moantones," which Wired Magazine this month defines as

The recorded sighs and moans of porn stars, available for download as cell phone ring tones. As porn princess (and moantoner) Jenna Jameson said in a press release: "The technology is way beyond most of us, but the bottom line is, you'll be able to hear me ... moan when your phone rings.

The French Art Thief
Did you hear about the guy in Paris who almost got away with stealing several paintings from the Louvre? He meticulously planned the crime. He got in and out past security. He was caught only two blocks away when his SUV ran out of gas.

When asked how he could mastermind such a crime, then make such an obvious error, he replied:

"Monsieur, I had no Monet to buy Degas to make the Van Gogh."

From cops' lips to your ears
"Relax, the handcuffs are tight because they're new. They'll stretch after you wear them awhile."

+ "If you run, you'll only go to jail tired."

+ "So you don't know how fast you were going. I guess that means I can write anything I want on the ticket?"

+ "Warning! You want a warning? O.K., I'm warning you not to do that again or I'll give you another ticket."

+ "Fair? You want me to be fair? Listen, fair is a place where you go to ride on rides, eat cotton candy, and step in monkey poop."

+ "Yeah, we have a quota. Two more tickets and my wife gets a toaster oven."

+ "No sir we don't have quotas. We used to have quotas but now we're allowed to write as many tickets as we want."

Harry Newton

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 is . You can't click on my email address. You have to re-type it . This protects me from software scanning the Internet for email addresses to spam. I have no role in choosing the Google ads. Thus I cannot endorse any, though some look mighty interesting. If you click on a link, Google may send me money. That money will help pay Claire's law school tuition. Read more about Google AdSense, click here and here.
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