Saturday, December 27, 2008

New Year Thinking - Building a new Portfolio from Scratch for a new beginning of the next Decade 2009 -2010. The thought that the Economic

Downturn is going to last a long time is presented by the over 40 crowd that have no feeling for the speed with which things have to move faster in the 21st Century - This revival will be burning with speed - anything else will be intolerable. Unintended Consequences? Sure they are always the surprise - how exciting!

I guess the best way to begin to build a 2009 -2010 portfolio from scratch would think about the date the market will begin its slow but big turn - Which if the Obama Team develops the proper plan to put $3 Trillion to work in Harmony. I would say that March to June will be the "Field Testing" of a no pork congress moving bills (as they were presented) quickly to Companies who know how to get the Job Done.

Dollar Cost Averaging along with Diversification (not necessarily by industry) would be the method.

The following is the beginning of my list of (to be developed) Core Holdings:

Berkshire Hathaway
Natural Gas
subsequent additions 1/6/09
as a group:

That is my beginning list - the reasons are that the first 7 are 2nd to none at what they do.
The last three have been trampled upon and are ready to find a median value which is about double the current prices. My personal feelings - Intel is the strongest best managed company in the universe - bar none (see what an idiot I am?) In dollar cost averaging I would "top heavy" the first 7 with $5 for $3 with the exception of AAPL and BRK/A /B I would weight inversely.

If you have any suggestions - I will move this list forward - If you comment this post - I'll add it with your suggestion and the Why.

ps. Mortality Considerations. There is no doubt that Steven Jobs (APPLE) is having health problems - considering the nature of his first bout - most die from pancreatic cancer the first time around. Warren Buffett is no spring chicken and is considered the Company (BRK/A BRK/B) his demise would have a hard hit on the stock.

Both Companies are run by "People" but the market will play to "what is perceived." Therefore dollar cost averaging should move 3 months at a time - increasing another 3 months ++, etc. holding back amounts to be allocated to an unfortunate event for these companies where you would start averaging in at a big drop in price for the next 3 month period until these securities regain confidence and price.

pps. What about War, natural catastrophies, etc. - "These are the cost of doing Business" - nothing personal.

ppps. What about Banks and Financial Institutions? - I don't understand them - my weakness.

Finally, and for me, we are in a most exciting "time". Obama - is the promise - promised!
[Retail sales chart]
I guess we can look at the Retail Economy which affects the Productive Economy as two human bodies. You feed raw materials into the mouth and shit comes out of the bottom. The above graph represents the beginning of a great constipation of the finished product - which will eventually back up to the input of raw materials - to the point of the body stops functioning.
So the first Human Body starts to shut down and it causes the second Human Body to begin its shut down. As the body shuts down all of the labor and equipment in the body begins to shut down also...That's why the importance of voluminous amounts of shit to keep exiting the body is a necessity.

Unemployment will enter the next level up in early 2009. Manufacturing equipment will not be needed, nor will the people who work in this industry. Raw Materials, energy, copper, aluminum, steel, plastic, Oil, will begin to be stored for the future and the limits of storage. Basic material production and employment will shut down. OK. Prices will drop and pick up steam as we move into early spring - unemployment will be over 10% maybe to 15% - Obama will be entering the scene on Jan 20th - assuming congress goes along - $3 Trillion will be pumped into the economy and offered to companies who can hit the ground running - and pass off their increased production - like a relay race - one running passing to the next running, etc.

If a symphony and ballet is created by this action - the economy should on its turn to recovery by early Fall....or..........?

Thursday, December 25, 2008

Happy Xmas (War Is Over) - John Lennon

What a perfect day to stop the war and bring our troops home - NOW!

"An eye for an eye will make us all blind" - Mahatma Gandhi

Tuesday, December 23, 2008

Suicide Watch - Dead Men Walking as I write.

Suicide is condemning yourself to death. First you visit "Hell on Earth" - the real and only hell - then you see that every turn available is unacceptable. Anxiety reaches astronomical levels, Searching for the way - out of this hell. You eliminate social contact around your life, including intimates - they cannot help, only interfere - It's a private matter of the utmost, and can only be experienced by one. There are many ways to commit suicide - the internet has thorough discussions, mostly by people who have failed. It behooves everyone to learn the best method for themselves - and then to fine tune the procedure - so that success is guaranteed. How to Point the Gun, what pills to take, the importance of the plastic bag and rubberband - unless of course you're going to jump or drown yourself (messy.) There is a point in anyone's life (anyone!) that suicide becomes a thought, moved up to an option, moved up to a plan and "Execution." It is...the perfect crime!

Today, The first suicide has been announced in the "Bernie Madoff ponsi scheme" potentially ripping off or losing up to $50 Million of other peoples money.

Thierry Magon de La Villehuchet, who ran a fund that invested with Bernard Madoff, was found dead at his office today in an apparent suicide. De la Villehuchet, 65, was a co-founder and chief executive officer of Access International Advisors, according to a marketing document. Access, based in New York, invested $1.4 billion with Madoff.

Before founding Access in 1994 with Patrick Littaye, de La Villehuchet was chairman and CEO of Credit Lyonnais Securities USA, the U.S. investment banking arm of the French bank, according to Access marketing documents. Prior to joining Credit Lyonnais in 1987, he ran Interfinance, an international broker firm specializing in French, Belgian and Italian stock markets that he founded in 1983.

More to come - a Certainty!

Nursing Home Reading for me in the Future

I mostly write this site so, When I'm older and grey-er (grey for age, gray for color) mostly feeble, mind searching for the past, not even knowing there is a present or future - past driving, hardly walking - shuffling mostly - hardly dressing out of these sweats - I'll have something to read and take comfort - how wonderful the past was, compared to this present time (maybe 2020.)

A summary of thoughts from various people (I respect - there are very few) just before this exceptional time - Christmas 2008:

"This is a truly global recession. We learned overnight that Japanese exports collapsed 26.7% year-over-year in November; that's the biggest drop on record. Shipments to the US plunged at an unprecedented 34% year-over-year rate. Meanwhile, imports into Japan sank 14.4% year-over-year in a sign of weakening domestic demand. A similar story out of Thailand, where exports dropped 18.6% in what was the biggest drop in at least 16 years. In China, interest rates were cut for the fifth time in three months."

"Now that the auto-makers have secured a $17 billion bailout, the next group heading to Washington for government assistance is property developers. Take a look at the front page of today's Wall Street Journal, "Developers Ask US For Bailout as Massive Debt Looms." Developers are warning policymakers that office complexes, malls, hotels and other commercial real estate are headed into default and bankruptcy."

Let's stop here, early in the discussion and point immediate blame to the Financial Industry, mostly in the United States - meaning Banks (loans, mortgages, credit cards) Security Dealers
(theft and manipulation) - derivatives without substance - Insurance Companies - by complicity, and finally Congress - greed thru eating too much "pork" and taking too much loot from the Financial industry - Lobbying - devils work. Big Business through complicity and professionals that support them - Lawyers and Accountants. (remember what Shakespeare said?)

I Digress......(sigh..)

We have 1.2 million unemployed construction workers. We have 123,000 unemployed architects and engineers. We have 83,000 unemployed machinery workers. We have 145,000 unemployed transportation-related workers (and that is just the "legal" ones) no one is counting the undocumented, the "under the table - black market ones) - lets just add 250,000 for them.
So that brings us to close to 2 million in the infra-structure business - Obama's focus.

But - Wait A Minute - the bulk of the joblessness is in financials (up to half a million), retail/wholesale (1.2 million), leisure/hospitality (1.3 million) and health/education (1.2 million) - Wow, another 4 million And if investment bankers, shopkeepers, bell captains and medical chart technicians have anything in common it is that they don't have much experience in shovel-ready activities.

Households have lost over $7 trillion in terms of net worth in the year ending 3Q, and it looks like this wealth destruction will top $10 trillion when the 4Q Fed flow­-of-funds data come out.
Christmas shopping is seeing deflated prices (Real Deflated Prices) an average of 50 to - 60% off listed prices - Just to get some cash, any cash out of their inventory! DEFLATION.

Our Population today is about 3 times that of 1929 - we are in a 1929 nose dive - with a much heavier plane - with more sophisticated (financial) instruments - a dumber government - and in Bad Weather - It has been determined that the Mistake of the Last Depression - the government did not flood the economy with cash - which would lessened the Depression.
So, We'll see...........

We are facing International Trade Protectionism (most countries looking inward) setting tariffs for foreign goods, governments raising money to protect their industries from foreign takeovers, and finally - wars for survival in unstable countries. It's all about self-preservation.

What makes Gold and commodities look so good is the lack of stability for gold and spending on infrastructure for Commodities. Cash is king, however - at least for now. How do you buy Gold
you can't - folks are waiting in line for "real" gold - you can only buy derivatives. "real" gold is well over $1,200 an ounce if you can find it - the derivatives are sold on the market somewhere
around $800+. What is a derivative? A Promise. What caused most of the financial difficulties of the 2008 financial crisis - Derivatives - of financial securities.

Why is the weather so bleak outside today?

Sources: David Rosenberg (primary) John Mauldin, Wall Street Journal, New York Times, Business Week - US Government statistics, Department of Labor, etc.

ps. Shakespeare said, "First, lets kill all the Lawyers" - that's more than 50% of congress, all the judges, maybe 20% of Wall Street - a good percentage of state and local legislators - maybe 10% of corporate leaders. I guess, that's a good starting place.

Sunday, December 21, 2008

What Would an OBGYN know about our Economy - WTF? Ron Paul (R) His party ridiculed him - The Evangelistas ran him out of the party!

Peter Schiff, an economist, was laughed off the Business TV Shows and his opinions were minimized.

Jim Wilder - A friend and Riding Partner a belated Rest in Peace

Valley of the Gods, Utah

I was visiting a riding area in Arizona that I had been away from for 3 years. Word from Ron Olson conveyed the news of Jim's passing

November 7, 1940 ~ March 5, 2008 James R. Wilder, 67 of Blanding, UT passed away March 5, 2008. Born to William and Marjorie Wilder in Yoakum, TX on November 7, 1940, and spent most of his childhood in Maryland. Jim graduated from the University of Maryland with a BA and made a life career with The Drug Enforcement Administration in Washington, DC. Jim leaves behind the love of his life Janine, along with children and grandchildren

Jim Wilder, Horseman

Saturday, December 20, 2008


World Internet Traffic Digitized

"Because the truth is that promoting science isn't just about providing resources — it's about protecting free and open inquiry. It's about ensuring that facts and evidence are never twisted or obscured by politics or ideology," he said. "I could not have a better team to guide me in this work."
- Barack Obama

"From landing on the moon, to sequencing the human genome, to inventing the Internet, America has been the first to cross that new frontier because we had leaders who paved the way," Obama said in announcing his selections in his weekly radio address. "Leaders who not only invested in our scientists, but who respected the integrity of the scientific process."

In his radio address, Obama said he planned early next year to more closely address the issue of engaging the nation's technology community to "harness technology and innovation to create jobs, enhance America's competitiveness and advance our national priorities."

"It's time we once again put science at the top of our agenda and worked to restore America's place as the world leader in science and technology," he said.

Obama had been making headway in National Programs - he is just warming up -to throw "Fast Ball Strikes." Next year will be Turbo Charged - redirection of 300+ million people and 3 1/2 million Square miles of Terra Firma along with its waters and seaways.- It's in the Air - can you feel it?

ps. a friend just wrote: "the Burger House in Miami (aka La Cocina de Casillas) is open and they have the best green chile burros on the planet. " - If you are near, please write your opinion - I need a confirm "Trust but Verify" before I fly there to try it out!

Tuesday, December 16, 2008

The Federal Reserve Board - a few minutes ago

Arches National Park, Moab, Utah 2003

Has changed it's "moving forward" attitude - which shows their concern, publicly, that the Recession is what we want as opposed to a Depression which is our direction - although they have not used those words - they have looked over the horizon and see something - they are not willing to head up with! A Brave move - being ahead of the problem rather than being behind, as they have been.

Finally, the Catalyst along with the Malloff ponzi scheme - should be - a turning point - ready for Obama to take over - like a script has been written - we are entering Act III, Scene 1 (the "Hump")

Hari Kari - Seppuku (切腹, "stomach-cutting")

An ancient form of ritual suicide that defeated samurai, or those whose shame was 'too unbearable' would use to restore their honor in death. In sepuku, one would take a wakizashi (short sword) and dissembowel oneself (Two stab cuts in the stomach allowing the contents to fall out in front of the body) The less noise you made while doing this, the braver you were and therefore the more honorable, however this did not last long as not long after you had begun, a close friend, comrade, or enemy would put you out of your misery by cleaving your head from your shoulders in one swift blow of the katana (another japanese sword).

It is Time, these Wall Street "Shamefuls" [sic] stepped off the curb, onto Wall Street, to restore their Honor.

There were a large number of Funds - That Bought into
other Funds (Funds of Funds) that did nothing for their
customers other than to take another Fee for moving the
cash. These fees were 1% of the value + 20% of the Profits -
annually. The List of these "Funds of Funds" implicated is
enormous in, both in number of Funds participating and the
Amounts lost!
My example of Fairfield Greenwich Group has 20+ partners
who should line up on the curb - I will contribute to "Fund
for Swords" (about $2,000 for the pair).

Adult Diaper sales are up in Connecticut - to the point of
empty shelves - Wives, and Daughters, so disappointed in
their mates, and fathers, are confessing their countless
"infidelities and affairs" in the neighborhood to further
humiliate their dishonored mates and fathers. For Shame!

A (new to me) Google Feature - Google Desktop

Google offered me a new feature called "Google Desktop"
I rate this feature along with Mozilla, Netvibes, and Flickr
as the Best Downloads I have added to my computer in the
last 36 months.

Google Desktop - will, when doing a Web Search, also
search my Hard Drive and Cache and give me "the where
it is located" - like trying to find something you have searched
before - and you would like to go back to that specific search.

Download Google Desktop - Go to Preferences. Within Preferences
are four tabs. The first tab "Desktop Search" First area within:
Check - Enable Content Indexing

Next: Search Types - check all that you use and at the bottom
check (of that section) Check "secure pages in web history"

Go Down a few categories to "Google Integration"
Check -"Show Desktop Search Results in Google Web Search"
Across the top tabs go to "Other" and check - Enable Safe Browsing

Now when you do a Google Search you will get both a web search
and a "within your computer search - including a previous specific
area you would like to get back to.

Monday, December 15, 2008

Due Diligence This Fund lost 1/2 of its $14 Billion

Fairfield Greenwich Group
As of November 1, 2008, assets under management at FGG totaled approximately $14.1 billion, of which approximately $7.5 billion was invested in vehicles connected to Bernard L. Madoff Investment Securities.

* Walter Noel
* Jeffrey Tucker
* Andrés Piedrahita
* Richard Landsberger
* Lourdes Barreneche
* Cornelis Boele
* Matthew C. Brown
* Yanko Della Schiava
* Harold Greisman
* Jacqueline Harary
* Vianney d’Hendecourt
* David B. Horn
* Daniel Lipton
* Julia Luongo
* Mark McKeefry
* Charles Murphy
* Maria Teresa Pulido Mendoza
* Santiago Reyes
* Andrew Smith
* Philip Toub
* Amit Vijayvergiya

FGG’s due diligence process is deeper and broader than a typical Fund of Funds, resembling that of an asset management company acquiring another asset manager, rather than a passive investor entering a disposable investment.

FGG’s legal, compliance, and accounting teams specialize in investment management regulation, securities compliance, corporate operations, and tax issues. Hedge fund managers function within an ever more complex legal and regulatory landscape, and the role of this part of the diligence exam is to determine the seriousness of any deficiencies in this area which may cause risk of sanction, loss, or reputational embarrassment.

Both in-house and retained legal professionals interview the management and staff of the manager, research regulatory filings, and review corporate organizational documents, as well as fund memoranda and related material contracts.

addendum: After 10 hours of thinking about this, listening to all the discussions of Psychopathic behavior, etc, ad nauseum, more ad nauseum, I think Bernard Madoff cast a big net to catch big fish. Unfortunately, any nets catch the unintended little fish - the cost of doing business. I am very impressed (I don't care what you think) with his ability to keep this thing up in the air and off the ground (for years.) How he got around filings, registrations - How he must have sent statements to all the "fish" that kept their balances (that read their statements, that believed the statements - monied people) how he must have filed 1099B's and dividend distributions without raising an eyebrow - was pure genius - I am impressed - In the Hall of Fame of Great Performers - he will go down and be talked about for the next 50 Years. Bernie - see you at the next Kennedy Center for Performing Arts - WOW - way to go!!!

Saturday, December 13, 2008

Friday, December 12, 2008

Exclusive Palm Beach Country Club - Rape

Bernard Madoff, former Nasdaq Stock Market chairman and founder of Bernard L. Madoff Investment Securities LLC, was arrested and charged with securities fraud Thursday in what federal prosecutors called a Ponzi scheme that could involve losses of more than $50 billion.

Among Madoff's major investors were members of the exclusive Palm Beach Country Club. It was boasted, that one of the privileges of being a member of the Palm Beach Country Club was that you got access to Bernard Madoff investing your money.

"Bernard Madoff is a longstanding leader in the financial services industry with an unblemished record," Dan Horwitz, a lawyer for Madoff, told the Journal. "He is a person of integrity. He intends to fight to get through this unfortunate event. "Madoff's firm is known as securities broker dealer, but he also runs a separate investment advisory business which had more than $17 billion in assets under management, federal authorities said, citing two unidentified employees and a Securities and Exchange Commission filing.
Madoff counted several large hedge fund investment firms as clients, along with some European banks, so if his firm has lost more than $50 billion, the impact could be widespread. On Wednesday, Madoff told two senior employees that he was "finished," that he had "absolutely nothing," that "it's all just one big lie," and that it was "basically, a giant Ponzi scheme," federal prosecutors said in their statement.
According to a criminal complaint filed on Thursday and cited by the Journal, Madoff "deceived investors by operating a securities business in which he traded and lost investor money, and then paid certain investors purported returns on investment with the principal received from other, different investors, which resulted in losses of approximately billions of dollars."
Madoff also said his business was insolvent, and that it had been for years, estimating losses to be at least $50 billion, prosecutors alleged, again citing the two unidentified employees.
According to the complaint, Madoff told one of his senior employees that clients were seeking about $7 billion in redemptions and that "he was struggling to obtain the liquidity necessary to meet those obligations." The employees believed the firm had about $17 billion under management.
Earlier this week, Madoff also allegedly told an employee that he wanted to pay bonuses to employees this month-- earlier than usual. Later, two employees who met with Madoff at his apartment were told that the business was a giant Ponzi scheme, which they took to mean that Madoff "for years been paying returns to investors out of principal received from other, different investors." Madoff allegedly told those employees that the firm was insolvent, according to the complaint.

PS. Experts, Geniuses, Mavens - an unwarranted appraisal of any living being. Sooner or later, time passes them by, they begin to hedge their ideas, lie, cheat, steal, etc. In aging they have to feed their "presence" of the past. Once someone has been pronounced they are one of these titles, you can be sure they are a fool. In death, Genius can finally be titled to a very few.

Thursday, December 11, 2008

"I feel like God wants me to run for President. I can't explain it, but I sense my country is going to need me. Something is going to happen... I know it won't be easy on me or my family, but God wants me to do it." - George W. Bush

"God told me to strike at al Qaeda and I struck them, and then he instructed me to strike at Saddam [Hussein], which I did, and now I am determined to solve the problem in the Middle East. If you help me I will act, and if not, the elections will come and I will have to focus on them." - George W. Bush

"I'm the Commander, see ... I do not need to explain why I say things. That's the interesting thing about being the President ... [I] don't feel like I owe anybody an explanation." - George W. Bush

"I do know I'm ready for the job. And, if not, that's just the way it goes" - George W. Bush 2000

I don't see how you can be president at least from my perspective, how you can be president, without a relationship with the Lord. - George W. Bush

"If most of the breaks go to wealthy people it's because most of the people who pay taxes are wealthy - George W. Bush
(The Majority of Income Taxes come from the Middle Class in the USA)

It's very possible, God used these times to close the lid on his so called Vocal followers to keep quiet - to keep their prayers and wishes to themselves - to ask for forgiveness - 100 million people rushed George W. Bush into the White House in the name of god - How you act in the future will determine how you are forgiven - God told me that!

Saturday, December 6, 2008

Moving to the Middle, as it should be.
President Elect Barack Obama, will lead an aggressive approach to the beginning of his administration. His detractors (voting and complaining) from the right, mostly about raising taxes - will be quieted, immediately, as they hear that raising taxes on the rich - will be put off for a year or two - quelling and silencing conservatives, evangelistas and Fox News (perversion at its best!)

Thursday, December 4, 2008

A Solution in Search of a Problem - $ 3 Trillion

Everyone is picking away at the $750 Billion rescue money - wasted on the likes of the Acquisition of Bear Stearns, by JP Morgan, the 2 bail outs (so far) of AIG Insurance Co. - Forcing some on the large 8 banks to take some - now the Automobile Companies - Avis is now looking for some of it. It is said it will probably increase to $3 Trillion before they know where they are. Actually, they don't know at this time when the signal will come that one of the placements will turn the country's economic problems around - stay tuned - the line is gathering at the "Give out Window"

It wasn't long ago that the Great Orator Everett Dirkson, Illinois Seanator made a statement about a budget item - "“A billion here, a billion there, pretty soon it adds up to real money.”!"

He had a slow voice that sounded like it came out of a pack of Cigarettes - A vocal cocktail part Lyndon Johnson part Paul Harvey - and a thousand packs of Chesterfield, Camel or Lucky Strike - no filter tip - A la carte - All entertainment!

Everett Dirkson, today would be considered
Beyond Right Wing, Beyond Evangelistas,
a peg, standing alone, in the extreme right
field. Also, a friend of Lyndon Johnson,
big liberal from the south

Everett Dirkson
1896 - 1969 died of Lung Cancer

Addition To Post Below concerning Store Closings

AT&T to cut 12,000 (4%) of it's employees

Credit Suisse said Thursday that it will cut roughly 5,300, or 11% - London

Nomura Holdings (London) 1000 jobs cut after Lehman purchased assets

DuPont to dismiss 6,500 employees, including contractors - The 4,000 contractors, by agreement, are not employees but self-employed. Nationally, this will be a very big number that is not reflected in unemployment figure.

Announced this morning before 10am - this should continue every morning for awhile I believe the Jobs Report on Friday will let us see how many people have been "rendered" unemployed by the unnamed companies and companies too small to mention - but gathered as "The Unnamed" will be substantial.

To My Family and Friends - My plans for 2009

Ponte di veia Verona
Ponte di veia Verona

From December 1st, continuing at Pleasant Harbor, Lake Pleasant 15 miles west of Cave Creek, AZ. In early March, flying to Brooklyn to Visit Lily.At the end of March I plan to move (from Cave Creek, AZ) to Kernville, Ca. for a month. I'll be taking some Whitewater instruction from Sierra South on the Kern River - snow melt from the Sierra Mtn Range. In May, I'll be heading to the Payette River, North of Boise, ID Cascade Kayak School in Horseshoe Bend, Idaho, June is open for somewhere in Idaho or Oregon and then in late June thru August to Stanley Idaho, north of Sun Valley - the Salmon River. That's it till Labor Day. In the early fall, I'll be heading toward some of the rivers in Utah - Time frame unknown - leading back to Pleasant Harbor by November 1st through March of 2010. I have found that plans are a structure not always to be followed - any influence to my life can change my direction 360 degrees, except for staying in the general area of the 13 Western States of the United States. On my 70th Birthday, I'm moving to Verona, Italy to spend the remainder of my life - consuming the wine, food and scenic comfort of the area - closest Airport - Milan - closest neighbor Croatia, to the east, Switzerland to the north, France to the west and the Mediterranean Sea to the south. Dreams are my initial step to planning. I plan on sending my Daughter and her mom a year ahead to locate the best place for me to live - the two best minds I know for the task!

P.S. there is a race going on for my 70th birthday - will I just be running out of cash - or will I be saved by a resurrected Stock Market?