Harry Newton's In Search of The Perfect Investment
Newton's In Search Of The Perfect Investment. Technology Investor.
8:30 AM Tuesday, February 14, 2006: Let's
talk about the economy. You and I are doing just fine. We have jobs. (Unemployment
is way down.) We have money. (Liquidity is way up.) Our customers and clients
are still buying. (The economy is chugging along.) Our taxes are low (especially
our capital gains). We can still borrow cheaply (though a tinge more than a
year ago.) The value of our houses have risen. And our stockmarket investments
were -- at least until the last two weeks -- doing just fine.
That's my personal side. It feels good.
Then there's my "professional" side. I once graduated in economics.
Everything I learned in school seems to have gone awry in the real world. My
biggest "professional" concerns are:
Our huge (and continuing) trade deficit.
2. Our huge (and continuing) government spending deficit.
3. Our ultra-low personal savings -- last year less than zero.
Many economists are now using the word "unsustainable."
trade deficit will have to come down, the housing boom (the key element of our
present buoyancy) will end, and both American consumers and the U.S. government
will have to start living within their means.
Soft landing or
It's out of our
hands. Our trade and government deficits are funded by China and Japan sending
us money and buying our government's bonds.
Will they stop buying? Many people argue that they can't, since their
buying gives them two benefits:
1. It gives them somewhere safe to put their money. Nothing is safer than U.S.
2. It keeps the value of their currency low (and our dollar high). This way
we can afford to keep buying their stuff and they can keep their people employed.
If they keep sending
us their money to buy our government's bonds, we can keep bingeing. If they
don't, some "experts" argue that, to eliminate the trade deficit,
the dollar will fall 30 percent.
thought this bubble would have burst years ago. It hasn't. Every economist has
Perhaps the best
strategy is to simply to ignore all the "noise" in the Wall Street
Journal, the New York Times and on BubbleVision? What can you do? What should
1. Play it conservatively.
2. Limit your borrowings. Don't buy stocks on margin. Don't borrow excessively
against your real estate.
3. Keep your investments diverse.
4. Keep enough cash on cash to finance at least six months of your present life
Today, Saint Valentine's Day: In the Middle
Ages, the belief that birds and rabbits chose their mates on St. Valentine's
Day led to the idea that boys and girls would do the same. St. Valentine, a
Roman, was martyred for refusing to give up Christianity. Legend has it that
St. Valentine left a farewell note for the jailer's daughter, who had become
his friend, and signed it "From Your Valentine". In the United States,
commercial valentines were introduced in the 1800s. Now, many Manhattan
restaurants require you to pay hundreds of dollars if you cancel your reservation
did you guess?
Three old mischievous grandmas were sitting on a bench outside a
nursing home. About then an old grandpa walked by, and one of the old grandmas
yelled out saying, "We bet we can tell exactly how old you are.
man said, "There ain't no way you can guess it, you old fools.
"One of the ornery grandmas said, "Sure we can! Just drop your under
shorts and we can tell your exact age."
Embarrassed just a little, he dropped his drawers. The grandmas stared at him
for a while, asked him to turn around a couple of times, asked him to jump up
and down for a little while and then they all piped up and said, "You're
84 years old!"
"How in the world did you guess?" he asked.
The grandmas, snickered and laughed. Slapping their knees and grinning from
ear to ear, all three happily yelled in unison, "Because you told us yesterday."
kosher in London:
An American Jew was shopping on Regent Street in London. He entered
a posh gourmet food store. A salesman in a morning coat with tie and tails approached.
"May I be of help to you, sir?"
like a pound of lox."
do you mean smoked salmon?"
pound of smoked salmon."
"Yes, a dozen
you mean crepes.
"Yes. A pound
of chopped liver."
probably referring to pate."
pound of pate, and could you deliver this Saturday?"
we don't schlep that chazzerai on Shabbos."
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+ Blackstone private equity funds. Click
+ Manhattan Pharmaceuticals: Click
+ NovaDel Biosciences appeals. Click
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+ All turned on by biotech. Click
+ Steve Jobs Commencement Address. The text is available:
Click here. The full audio is available. Click
+ The March of the Penguins, an exquisite movie. Click
+ When to sell stocks. Click
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
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