Harry Newton's In Search of The Perfect Investment
Newton's In Search Of The Perfect Investment. Technology Investor.
8:30 AM Tuesday, October 18, 2005: The
lesson emerges: Decent due diligence takes oodles of your time. If you don't
have the time, say NO. Preserving your capital is far more important than seizing
the latest, hot opportunity. Now add to due diligence a deeply cynical view
of "regulation" as a protection for your monies.
From today's Wall
Street Journal, "Who regulates Refco? The answer is that Refco may
have fallen through a deliberate crack in the regulatory system that has been
known about and debated for years. Like many large banks, investment houses
and other U.S. financial-services institutions, Refco has several subsidiaries.
Some are regulated; some are not. The parent company is regulated to the extent
that all publicly traded companies are subject to oversight by the Securities
and Exchange Commission and the New York Stock Exchange, where Refco's stock
is traded. Regulators require that the parent maintain a certain amount of capital
in its regulated securities and commodities-trading units."
But that oversight doesn't happen when the boss is a creative or crooked, or
both. Refco was the classic cockroach stock. Parts of Refco are now in bankruptcy.
Diligence -- A Continuing Series: I wonder how much due diligence
Rupert Murdoch's people did before they agreed to pay $580 million for MySpace.com.
A reader, the president of a mortgage brokerage company, writes yesterday, "One
of my younger loan officers spends a great deal of time on MySpace as he tells
me its a forum for business exchange. After observing him for the past 4 months,
I see MySpace as site where a individual can advertise his/her availability
for a threesome."
I replied: "You
mean a threesome for sex?"
And he replied,
"Yes, my loan officer would abruptly leave as such impromptu opportunities
would turn up for him, actually somewhat regularly."
Intrigued, I floated around MySpace a little and found it dripping with sex
Due Diligence: BusinessWeek has an article
on yet another hedge fund (called Wood River Capital Management) which lied
about its auditors, lied about its bookkeeper and lied about prime broker. The
article quotes Barry P. Barbash, a former director of the SEC's investment-management
division, "A lot of times what passes for due diligence is really unverified
husbands. An Italian man sentenced to nine months of house arrest
begged the judge to jail him. He explained he wanted to avoid his wife's nagging.
"I need some peace," pleaded Ahmed Salhi, an Algerian immigrant. The
judge said he fully understand and jailed him.
Free people: "When people are free
to do as they please, they usually imitate each other." -- Eric Hoffer.
An apple a day, if well aimed, keeps the
doctor away. -- P.G. Wodehouse.
Save Hundreds on Your Heating Bill.
AN UNFORESEEN MIRACLE, this year's home-heating bills will likely be a lot higher
than last year's which were a lot higher than the year before. According
to the Energy Information Administration (EIA), a typical homeowner in the Northeast
where two thirds of oil-heated homes are located can expect to
spend an average of $1,675 this winter season, a 31% increase over last
year. Homeowners who use natural gas will be spending more, too, with the EIA
predicting a 46% increase over last year, to $1,480.
But before you
start loading up on some extra pairs of mittens to wear around the house, know
this: With a few simple steps, you could slice hundreds off your annual energy
tab. Here are five ways to cut costs.
Regardless of the type of heating system you have, it needs an annual check-up
by a professional. ... If your heat is delivered through a duct system (the
most common heating system in the U.S.), you aren't off the hook once your annual
checkup is complete. You need to continue to clean or change the filters regularly,
2. Buy a Programmable
After a cold commute, you like to open your door to a toasty home. And you hate
waking up in a cold bedroom. But that doesn't mean you need to have the heat
blasting day and night. ... With a programmable thermostat, you can heat your
home at various temperatures throughout the day, allowing the house to be cooler
when no one is home or when everyone is asleep.
3. Plug Up
Imagine a water balloon with lots of little pinholes in it. Chances are, your
house is like that balloon slowly but surely losing heat to tiny leaks.
And a lot of little leaks can add up to one big bill. Doors and windows are
the most obvious culprits. But you also should check electrical outlets, ceiling
fixtures, ducts and your attic door. ... A simple test suggested by the Department
of Energy is to light an incense stick and hold it up near suspect leaks. If
the smoke goes horizontal, you've found a leak.
4. Add Insulation
Many homes particularly those that are more than 20 years old
lose lots of heat because of poor insulation. And because heat rises, the No.
1 problem area is your attic. Other areas that could need more insulation are
your basement, crawl space, floor and walls.
If you have home-heating appliances that date back to the Reagan administration
or earlier, it could be time to think about an upgrade. Replacing an outdated
model with one that has earned the Energy Star label (Energy Star is a joint
program run by the Environmental Protection Agency and the Department of Energy)
could cut your home-heating costs significantly. Energy Star furnaces, for example,
are 15% more efficient than standard models.
25 Extreme Energy-Saving Tips
1. Appliances and Lighting
Appliances and lighting account for 28% of the typical household's
annual energy use. Here's what you can do to conserve.
* Replace incandescent light bulbs with compact fluorescent bulbs. On average,
they use 66% less energy.
* Keep bulbs clean. Dust can cut light output by as much as 25%.
* When preheating an oven, don't let it sit empty for longer than necessary,
and don't open the door to check on food. Every time you do that, you lose 25%
of the heat.
* Use a microwave oven instead of a regular oven. You'll burn 40% less
* Keep the inside of your microwave clean. It will cook your food more efficiently.
* Use the smallest pans possible. It takes energy to heat them.
* Use lids. They help the food cook more quickly by keeping steam inside.
* Use glass or ceramic pans in ovens. They heat faster than metal pans.
* Wash and dry full loads, and don't over-dry clothes.
* Keep the dryer's lint filter clean.
* Wash laundry in cold water instead of hot, unless you're dealing with very
* Don't add wet items to a load in the dryer that has already been started.
* Wash only full loads. It costs exactly the same to wash one dish as a
* If your dishwasher has an air-dry feature, use it.
* If you wash by hand, rinse dishes in groups rather than one at a time, and
don't leave the water running.
* Check refrigerator temperatures by putting one thermometer in a glass
of water in the center of the fridge and another between packages in the freezer.
You're losing money if temperatures are lower than 37-40 degrees for the main
compartment and 0-5 degrees in the freezer.
* Cover and wrap food. Uncovered food and liquids release moisture and drive
up electricity costs.
* Let hot food cool before putting it in the fridge. This way the fridge will
use less energy to cool it down.
* Keep the freezer full. It's more efficient than an empty freezer. If necessary,
fill up the space with plastic containers filled with water.
* If you have a second fridge that's not being used, unplug it. It can cost
about $130 a year to keep it plugged in.
2. Water heating
Water heating is the third-largest money-eater in your home, accounting
for 16% of annual energy consumption. Remember: you're paying for the
water and you're paying to heat it. You should:
* Lower your
water heater temperature from 140 degrees to 120 degrees. You'll cut your water
heating costs by 10% to 15%. Unfortunately, if you have an older-model dishwasher
that doesn't have a booster heater (a device that heats up the water to the
temperature the dishwasher needs to clean the dishes), you should leave the
water heater set to 140 degrees to make sure the bacteria on your dishes are
good and dead.
* Insulate your storage water heater tank. You'll save 4% to 9% on water heating
* Drain the sediment from the bottom of the water heater tank every one to three
* Install low-flow shower head and faucets. They use one-third to half the water
used by regular shower heads. You can cut your water use and water heating costs
by an average 15% to 30%.
* Take short showers (and preferably, no baths showers use less hot water).
is truly awful
This may come as a surprise to those of you not living in Las Vegas but there
are more Catholic churches there than casinos. Not surprisingly, some worshippers
at Sunday services will give casino chips rather than cash when the basket is
Since they get
chips from so many different casinos, the churches have devised a method to
sort the offerings.
The churches send
all their collected chips to a nearby Franciscan Monastery for sorting and then
the chips are taken to the casinos of origin and cashed in.
This is done by
the chip monk.
According to the Jewish calendar, the year is 5766.
According to the Chinese calendar, the year is 4703.
This means that for 1,063 years the Jews went without Chinese food.
These were known as the Dark Ages.
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+ 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
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