GE Unit Settles Over Medical Credit Cards
http://on.wsj.com/18AGRqy
First no money down zero intro interest home loans. Now the same for medical credit cards? Please, just say no.
Category Archives: Financial
LA Times: Think Black Friday is best day to get a deal? Think again
Take a look at this Los Angeles Times article. I’ll quote a little here and you can read the rest:
The weekend is crowded with misleading promotions, including deceptive discounts off misstated “original” prices and deals that could have been had a year earlier, according to NerdWallet. More than 90% of Black Friday ads this year feature items being sold at exactly the same price as they were last Black Friday, the financial advice website said.
And some door-buster prices are available throughout the year, including a $79.99 Tommy Hilfiger jacket at Macy’s that NerdWallet said was also offered during the retailer’s Veterans Day sale. At Target, researchers discovered a KitchenAid mixer selling for less than its advertised Black Friday sale price.
“Consumers make poor decisions when they’re under duress, and this is most obvious on Black Friday,” Ong said.
I added the emphasis on the KitchenAid mixer. If I read this correctly, retailers are actually raising prices on Black Friday after suckering you into their store with “door buster” deals that a small percentage of shoppers can obtain.
Swiss voters reject proposal to limit executives’ pay | Fox Business
Yet another example of widening wealth inequality. One of the FAME V conference speakers, Stephane I believe, also noted widening wealth inequality as an economic problem.
Although the Swiss government can not cap executive pay stockholders apparently can via a binding vote (in Switzerland). I am okay with that as long as the stockholders have a means to get together and have these binding votes on executive pay. Employees of privately held corporations probably do not have stock therefore no means to vote.
Let me touch on employees as stockholders a little bit more. Employees with defined benefit (pension) plans and defined contribution
(401k) plans are stockholders. But, the mechanism to get the will of the masses (workers) into action does not appear to be working. Income and wealth inequality are still growing around the world.
I can think of several reasons why the worker-owners (via retirement plan holdings) are not addressing the widening wealth gap:
1. Complacency
2. Executives, who ironically are supposed to act on the behalf of shareholders, may issue enough stock to themselves so they retain voting control. It is for this reason I will not invest in Facebook.
3. Outside investors such as wealthy individuals or hedge funds have more ownership than those working at a firm.
4. Worker-owners are unaware of their collective voting power.
5. Disinformation is used to trick worker-owners into voting in favor of wealth and income gap widening initiatives.
Item number 3 points to an interesting research idea: do firms with more employee ownership have more equitable pay? I will end with that question to ponder.
Why Twitter’s IPO Was Really a Failure
An excellent Forbes article written by Hersh Shefrin. My favorite quotes:
“No investor who bought the stock yesterday and held it to the end of the day came out ahead.”
“original shareholders leave money on the table when they set too low an offer price, because they give up more of the company to new investors than is necessary in so far as raising new funds”
So, in a sense, Facebook’s IPO brought in relatively more cash to the company than Twitter’s. Nevertheless, as far as Twitter’s future returns: “I can’t tell you the future, I can only tell you about the history.” For now, I continue with my “ignore” rating on the stock. 🙂
Here’s why you shouldn’t invest in Twitter
Because I don’t use it. Seriously, this article from the Wall Street Journal offers several reasons. In essence, it doesn’t meet the Warrant Buffet “Stable and Understandable” rule. Specifically, the WSJ article states
“You don’t understand Twitter. Few people do, really.”
Proceed with caution.
Why one woman is eager to buy Twitter shares
Why? Because she missed out on Apple and Facebook. Yep, that’s it. Here is the article: http://stream.wsj.com/story/markets/SS-2-5/SS-2-374835/
Now, this sounds similar to the old saying “when the shoeshine boy gives you stock tips get out of the market.” Why? At that point everyone who has money to put in the market has already put it in the market. Thus, no more upside. Here is a 1996 article on that subject:
http://money.cnn.com/magazines/fortune/fortune_archive/1996/04/15/211503/
And a 2012 article:
http://money.cnn.com/magazines/fortune/fortune_archive/1996/04/15/211503/
What do I think? In the long run, fundamentals matter. In the long run, companies must earn a profit, they must make more profit with less operating assets, they must have a business model, they must be a market leader, etc. in order to have favorable risk adjusted returns. In the short run, have fun trading with the changing moods and measurements of “the market.”
More high balance adjustable rate mortgage activity: haven’t we learned our lesson?
I can think of two reasons to take out a one year adjustable rate loan. (1) when you anticipate a fall in rates in the near future, or (2) you really can’t afford the home and the lower rate will help you get in.
I don’t think anyone believes rates are going down. So here we are again. Home buyers purchasing homes they can not afford with loans likely to default when rates rise or prices fall. Why buy a house you can’t afford? If you are a wannabe 1%er. You extend yourself to keep up with the Jones’ even though your salary has not. By the way, “the wealthy barber” advises against over extending to buy a home.
The irony is our attempts to keep up with the 1% ultimately puts us further behind. The banks are going to make money on us and/or get bailed out if they don’t. Either way wealth is transferred from the 99% to the 1%.
My recommendation: don’t do it.
Why Robert Reich Cares so Passionately about Economic Inequality | The Business Desk with Paul Solman | PBS NewsHour | PBS
Facebook changes privacy settings for teens
Why would Facebook loosen its teen privacy policy in the wake of yet another teen suicide connected to online bullying? I suspect the answer is simple: to make more money. Privacy and safety of teens be damned. Profits come first in capitalism.
I wonder if in some sick way Facebook sees cyberbullying as a means to expand its brand and profit. Maybe it will take more suicides and postings of drunk passed out girls for Facebook (and parents) to realize something must be done.
I don’t use Facebook simply because I don’t need to. Hopefully parents with teens will share that belief. If not, I hope they at least closely monitor their children’s internet activities. You won’t be invading their privacy. You will be doing your part to keep your child away from an increasing danger.
http://www.cnn.com/2013/10/16/tech/social-media/facebook-teens-privacy/
Macy’s to break with tradition, open Thanksgiving at 8 p.m.: employees – Chicago Sun-Times
Where is our country going? Traditions be damned? After 155 years Macy’s has decided to open on Thanksgiving day. I wonder if consumerism has gone too far. I wonder if any of the executives who receive bonuses will work from 8pm to 5am then again from 8am to 1pm. I wonder if the people shopping during those hours can truly afford what they are purchasing. I also wonder if the reason for the season is completely forgotten.
To sum it up in one sentence: i wonder if people who have forgotten the reason for the season are out spending money they don’t have at all hours, while laborers also are away from their families, so that executives who are in their expensive homes with their families can get another big bonus…
Efficient Minds™ 