Previous Columns
8:30 AM EST Friday, May 16, 2008: The mining boom continues. BHP shares are at peak. Ditto for most Australian miners, especially the ones I've mentioned. Oil is high, but gold and silver have pulled back from their peaks in March. You play this with a broad range of holdings - from the commodity ETFs, OIL, SLV and GLD -- to miners like BHP, Rio, Kagara, Minara, Oxiana, Apex Minerals, Western Area and Metex Resources.

First Solar (FSLR) is falling. I mentioned I had shorted it because it was too expensive, too hyped, too most everything. A reader emails:

Harry,

I agree with your assessment on FSLR, and I am short but with puts, not stock. FSLR's panels requite Tellurium and it is a very rare metal that was $10/Kg when FSLR started using it in 2004 but ran up to $860 last year and, as of April 9th, was selling for $2,060 per kilogram! Why is this? Because FSLR, in order to make just $158M (at an average of $400 per kg last year), USED UP 10% OF THE WORLD'S ANNUAL SUPPLY OF TELLURIUM! Their projections call for them to use 750% of all the tellurium on the planet by 2013, so unless they develop some amazing powers of manifestation, this stock is heading down (eventually).

Today's speculation: HeartWare makes a little pump that helps your ailing heart pump blood around your body, and, in turn, keeps you alive a bit longer.

The company is well-funded, has received FDA approval for trials in the U.S., is covered by patents, and, makes the smallest device around. Small is a huge benefit for surgeons, who have to find a place in your body to put it. There's a big market for these things, as congestive heart failure, etc. is rampant. I hear $60 billion a year spent on this disease in the U.S. alone. You could sell a million of these devices a year, just in the U.S. HeartWare is Australian. But it's easy to buy shares on the ASX, the Australian Stock Exchange. Symbol is HTW. The company is moving here (into a beautiful J&J factory, no less) and will soon be listed here. Meantime, the investors-who-know are loading the boat. I don't think there's any urgency about buying since, absent any news this summer, I can see the stock settling back.

A caveat: This is not a sure thing. It's easy to kill patients with these things. And something awry in upcoming patient trials could destroy the company. Meantime, go to HeartWare's web site and listen to annual meeting presentation by Doug Godshall. Most impressive. For an overview of the company, go to the ASX site.

Great headline: On news that GE may sell its appliances business, The Wall Street Journal headlined the story:

Feeling the Heat, GE
May Quit the Kitchen

From my son, Michael:

This American Life, the NPR radio show, did a special on explaining the mortgage-driven credit crisis last week. It is excellent and worth listening to. Nothing they did is rocket science but it is the best, simplest and most personal (i.e. stories of people on all sides of the industry – from Morgan Stanley to a borrower in Brooklyn) piece on the topic I have come across. For me, I knew all the pieces of what drove the crisis but always had trouble boiling it all down and putting it all together. This piece did it. I think it is worth the time while at the gym or whatever.

You can download the full MP3 podcast here for free.

I found the download worked better with Firefox.

From my wife, Susan:

This is mindblowing, frightening and fascinating. Professor Michael Greenberger spoke on National Public Radio on "Our Confusing Economy, Explained." There are more derivatives than there are stocks and bonds. You must listen to this 39 minute talk. Go here. If that doesn't work, go to www.npr.org and search for Michael Greenberg.

I couldn't figure how to download it. It sounds fine listening to it on the Internet.

Oil's murky outlook: Peter Coy, who is good, has a big piece in this weekend's BusinessWeek. Excerpt:

At about $124 a barrel, the price of crude oil has more than doubled since the start of 2007. The vast majority of government forecasters, stock analysts, economists, traders, and journalists who follow oil failed to see it coming. Even now their price estimates for the next several years are all over the place, ranging from $70 to as much as $500. How can that be? It’s hard to predict what prices are going to do in the next month, much less the next five years, if you don’t have a handle on current supply and demand. The problem is that the analysis requires data on production, consumption, and inventories — and those numbers are largely unreliable. The situation is only getting worse: China, the world’s fastest-growing oil consumer, is also one of the most opaque. Regrettably, the world oil market is no more transparent than a barrel of extra-heavy Orinoco crude. All this makes it impossible to say whether prices are headed for a so-called super spike or a super bust.

I still believe it's going higher for reasons I detailed here. The easiest way to play oil is through OIL:

The Top 10 Tech Trends: Eric Savitz, a talented Barron's reporter, posted this piece, which I've excerpted:

May 14
I’m at the Fairmont Hotel in San Jose tonight, for the Churchill Club’s annual Top 10 Tech Trends Dinner. This is the club’s 10th annual tech trend panel. Making the picks:

Steve Jurvetson, Draper Fisher Jurvetson.
Vinod Khosla, Khosla Ventures.
Josh Kopelman, First Round Capital.
Roger McNamee, Elevation Partners.
Joe Schoendorf, Accel Partners.
Tony Perkins, of Always On, is the moderator.
Perkins, McNamee, Jurvetson and Schoendorf have done this before. Kopelman and Khosla are the panel newbies.

1. From Steve Jurvetson: “Demographics are destiny, creating opportunity.” Baby boomers are an opportunity, including an “eBay for information” that exceeds the market for physical goods. This is a U.S./Canada/U.K. trend. Baby boomers as the first Internet savvy seniors. Smart, active, group, entering AARP age. 75 million of them, half the U.S. workforce. In 2025, the entire country will look like Florida does today. Nothing will change that. Demographics are destiny. Over half of businesses and franchises are started by people in this group. At home, educated and Internet savvy. Services online will exceed market for goods online. Another market: the mental exercise market. ...

2. From Vinod Knosla: The mobile phone will be a mainstream personal computer. With built in projector. Authentication. Credit cards on SIM cards. ID cards, passports, drivers licenses. Any information you need. Khosla says he keeps pictures of his passport electronically on his phone. He says people will be less likely to carry their laptops. Come near a computer, and physical hard drive will be yours, including half-sent email message you left at home. Lose the phone, and all the information is on the network. Imagine what you want to do, and it should be available anytime. Projectors in cell phones in next two years. More than one camera per cell phone; high priority for Texas Instruments. Critical ingredient is high speed networks, which we will have in next 2-3 years. Jurvetson says the trends are already playing out, other than the projector piece, particularly in Europe, where cell phones are 8% of credit card payments. ...

3. From Josh Kopelman: The rise of the “implicit” Internet. Today your permanent record exists; you create a trail of data exhaust, digital bread crumbs. Implicit data that exists in silence. Movie rentals, restaurant reservations, books purchased, Web sites visited, etc. All of this data existed in silence. No easy way until now to benefit from the data; but the silos are coming down. Google, Yahoo, Facebook, Mozilla collecting data. Trend is that big wave will come to companies that are able to find novel and new ways to deliver information by crossing these silos, with implicit data on the Internet. ...

4. From Roger McNamee: Betting on smart phones: The mobile device migration to smart phones from features phones will produce even greater disruption than PC industry moving from character mode to graphical interface. Used to be just Palm and Research in Motion. (Note that McNamee’s firm is a large investor in Palm.) What you are really doing, is put in real software environments, with applications layer that separates network from physical device. Phones far more pervasive than PCs. ...

5. From Joe Schoendorf: Water tech will replace global warming as a global priority. The world is running our of usable water and will kill millions more in our lifetime than global warming. Darfur could go down as the first water war of the 21st century. And with 2 million deaths, might not make the top 10 list. One billion of 6 billion people do not have healthy water. We’re losing close to 1 million people a year under 5 years old due to dirty water. Imagine a 60 year drought in this state. Within 15 years, will be up to 3 billion people with a water problem. 70% of water used for agriculture; 90% for developed countries. If nano technology can work, and can figure out desalinization, can prevent many wars over the next 30 years. Missing the Al Gore for water. ... T. Boone Pickens is selling oil companies and buying water companies.

6. Jurvetson: Evolution trumps design. Many interesting unsolved problems in computer science, nanotech, and synthetic biology require construction of complex systems. Evolutionary algorithms are a powerful alternative to traditional design, blossoming first in neural networks and now in microbial engineering. Near-term trend: year or two, components of microbial engineering products will involve some form of evolution. Design for evolution. Has been used in neural networks. In microbial work, cripple a microbe, so it can do the one thing it does better and better. To make industrial chemicals. Applied to analog circuit design. In the future, artificial intelligence. Most of the panel seem to have no idea what Jurvetson was talking about, really.

7. Khosla: Fossilizing fossil energy. Oil and coal will have trouble competing with biofuels. 99% of discussion on the topic is completely irrelevant to the topic. In 4-5 years will have production proof that can sell biofuel at well below $2 a gallon at today’s tax structure and no subsidy. Can’t imagine how big oil can stay in business if that is an alternative. Zero land needed to replace 100% of our gasoline. The other major issue is electrical power generation, which is coal and natural gas. One of his companies signed deal for 175 MW solar plant at costs below natural gas. Cheaper and less subject to commodity pricing. All of the panelists agree on that one.

8. Kopelman: Venture Capital 2.0. Venture capital has underwritten most of the transformative software and Internet companies over last 20 years. Changing economics will have dramatic impact on the venture capital industry, in particular for software and IT. Typical $400 million fund, to get 20% return, have to triple, and return $1.5 billion. ... VC industry is diversifying away from industry where returns are poor. ...

9. McNamee: Within 5 years, everything that matters to you will be available to you on a device that fits on your belt or in your purse. Massive shift in Internet traffic from PCs to smaller devices. You should all get a Kindle, and study this thing, Roger says. Apple has it in the long run, wrong. Won’t be about watching created content, it will be about creating content. ...

10. Schoendorf: 80% of the world population will carry mobile Internet devices within 5-10 years. Dial-tone is going to be gone. By next year, people will put micro cells in your house. China Mobile has 500 million billable lines. Within 5-10 years will hit 5 billion global wireless phones. Jurvetson thinks 80% is simply too high; he noes that a quarter of the world’s population has no electricity. They will concentrate in the richest nations, Jurvetson says.

And that’s it. Lots of mobile phone predictions. Green energy. Water. And more phones.

More reasons not to install Vista: Big business starts to sour on Vista, from this weekend's BusinessWeek.

Microsoft introduced Vista, the latest version of its Windows operating system, in New York City in January, 2007, with dramatic fanfare. Performers hung from a seven-story building to unfurl a Microsoft banner. A rock band blared in the rented-out Times Square theater. The CEOs of Dell, Toshiba, and Advanced Micro Devices joined Microsoft CEO Steve Ballmer on stage to celebrate what he called “the biggest launch in software history.” But now some high-profile corporate customers are taking a pass on Vista. In the most recent move, General Motors says it may take a detour around Vista because preliminary tests have turned up so many problems and complications. The automaker may wait for the next version of Windows, due in 2010 or 2011. “We’re considering bypassing Vista and going straight to Windows 7,” says Fred Killeen, chief systems and technology officer for GM. Many of Killeen’s corporate counterparts are similarly vexed by Vista. The operating system taxes all but the most modern PCs with its requirements for powerful microprocessors and muscular memory. It has compatibility issues, so certain kinds of software won’t run smoothly with the operating system. And corporate tech buyers say Vista has few valuable new features for their employees.

All about marriage
A lady inserted an ad in the classifieds:
'Husband Wanted'.
Next day she received a hundred letters.
They all said the same thing:
'You can have mine.'

When a woman steals your husband, there is no better revenge than to let her keep him.

A woman is incomplete until she is married. Then she is finished

Then there was a woman who said, 'I never knew what real happiness was until I got married, and by then, it was too late.'

Just think, if it weren't for marriage, men would go through life thinking they had no faults at all.

At a cocktail party, one woman said to another, 'Aren't you wearing your wedding ring on the wrong finger?'
'Yes, I am. I married the wrong man.'

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 on this site. Thus I cannot endorse, though some look interesting. If you click on a link, Google may send me money. Please note I'm not suggesting you do. That money, if there is any, may help pay Michael's business school tuition. Read more about Google AdSense, click here and here.
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