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Harry Newton's In Search of The Perfect Investment Newton's In Search Of The Perfect Investment. Technology Investor.

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8:30 AM Monday, August 15, 2005: Buy puts on oil. Think about the logic. Oil has skyrocketed. It closed at $67.18 on Friday. The logic? Refinery problems. Not logical. Refinery problems should affect the price of gas, not oil. If refineries are having difficulties, they are buying less, not more oil. Therefore oil should fall. What's driving up oil at present? It has to be speculation. And it has to drop -- at least temporarily. P.S. Oil inventories are high. The summer driving season is ending. Only concern: another major terrorist act. That's why you buy puts -- they limit your exposure.

I'm impressed with Disney's new chief, Robert A Iger. Or at least what I read about him in today's New York Times. Click here. The could be one of those classic turnaround situations:

Greed costs: It's happened to all of us. A fantastic investment at the time, turns sour later. Two lessons from the weekend:
1. A friend "invested" in a software company. He knows nothing about software, whether it works or how you sell it. The company has run out of money, again. And he is reluctant to put money in, again.
2. The New York Times led its Sunday business section with a $200 million hedge fund whose entire funds have disappeared. The article was called "Paradise and Money Lost." Click here.

The lessons are simple:
+ If it sounds too good to be true, it is.
+ If controls aren't in place (e.g. auditors) steer clear.
+ Previous high returns look great on paper, but could easily be fictional.
+ Don't put all your money into any "sure" thing. Nothing is.
+ A little due diligence and a little less enthusiasm go a long way.
+ Getting into something you know nothing about is a recipe for disaster.
+ Lose your principal. It takes a long time to get it back -- even at healthy interest rates.
+ Capital preservation is the name of the game.
+ Learn to say "NO." It's cheaper and better for your sanity.

Iraq's history:
In 1914, when Britain’s Mesopotamian Expeditionary Force entered Basra, Iraq did not exist as a state. The three provinces that form modern Iraq — Basra, Baghdad, and Mosul — were part of the Ottoman Empire and had been ruled well and badly by the Turks and their Sunni Arab cohorts for several hundred years. -- The Creation of Iraq, 1914–1921 by Judith S. Yaphe.

New Zealand is gorgeous (and safe): I'm trying to convince the family to go with me for a vacation.

How to play golf:
A guy named Mulhany wanted to play golf and this was the only threesome in which he could play. So, he joins the Rabbis and plays 18 holes.

At the end of the 18 holes, his score was 104. The Rabbis had shot 69, 70 and 72. So, he says to the Rabbis "How come you guys shoot such good golf?"

The lead Rabbi says, "When you lead a religious life, join and attend the right synagogue, you are rewarded."

Mulhany, a true lover of golf, thinks "what have I got to lose?" He finds a synagogue near his home, converts to Judaism, joins the synagogue, regularly attends services and leads a holy life.

About a year later, he again plays golf with the three Rabbis. He shoots a 104 and they shoot a 69, 70 and 71. He says to them: "OK, I converted, joined a synagogue, live a religious life and I still shoot a 104. What's the deal?"

"What synagogue did you join?" asks the lead Rabbi.

"Beth Shalom" is the reply

The Rabbi retorted, "Schmuck, that one is for tennis!"

Recent column highlights:
+ Manhattan Pharmaceuticals: Click here.
+ NovaDel Biosciences appeals. Click here.
+ Hana Biosciences appeals. Click here.
+ All turned on by biotech. Click here.
+ Steve Jobs Commencement Address. The text is available: Click here. The full audio is available. Click here.
+ The March of the Penguins, an exquisite movie. Click here.
+ When to sell your stocks. Click here.

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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