Blogs

Recently, a panel of economists debated measure to jump-start China’s private consumption. Here is our view.

The billionaire investor, Warren Buffett, teams up with AOL to publish a kids show online teaching responsible financial habits. The kids show will be titled "Secret Millionaire's Club with Warren Buffett." Here is a clip of Warren Buffett helping a group of kids learn about finance and investing concepts:

High frequency automated program trading is part of capitalism, quite interesting and useful forces to provide patient value investors with occasional inefficiency opportunities since these automated trading systems do not care about the intrinsic value of the companies behind the securities.

During the current dire economic conditions in the US and the world, anyone with IQ above 100 can observe quickly how easily and quickly it is for any companies large or small to terminate any of their employees at all levels (except the C-level in many cases) due to diminishing demand of their products and services. This is the new reality worldwide. No country, industry, and individual are really immune to this crisis. The expansion of the credit market which started in the US back in the early 1990s and later gained even more momentum from 2003 to the late 2007/early 2008 created a super-bubble in the mortgage and housing market. The bubble drove up valuation on almost all asset classes to astronomical level especially the ones driven by borrowed money. The next thing that has happened since late 2007 is obviously very well-known: a massive meltdown of all asset classes and large-scale global deleveraging process that in my opinion will likely last for a decade if not longer. Key economic figures are ugly and getting uglier. The important unemployment rate figures keep going up to the current tune of almost 10% in the US and this trend will likely to continue in the next several quarters. The foreclosure rates are getting higher and the trend does not seem to stop yet. The US and world GDPs are also still contracting. This condition has logically caused companies everywhere to cut cost and to trim their operations to adapt to the current reality. Lean is definitely in. Read more.

Investors nowadays need to be much more pro-active to prevent and identify potential frauds. Here are several useful sites that investors should know and bookmark to prevent and identify frauds.

There have been many unfortunate stories about investors being lied by some unethical investment managers managing other people's money (OPM) (e.g.: the biggest example is, of course, Madoff fraud) for the past few years especially last year. As a result, US government these days are moving toward creating and implementing more stringent regulations to various types of investment companies especially hedge funds. In our view, US government is moving to the right direction (as long as it does not go too far.) However, even without enforcements of regulations, investors should, can and need to protect themselves and reduce risks of frauds. 

According to Wall Street Journal today, Steve Jobs had a liver transplant 2 months ago in Tennessee. He is recovering well according to the paper and plan to return to work later this month. Here is the link to the source: WSJ (06/20/2009)

Steve Jobs is known for being very workaholic & innovative entrepreneur co-founding & running two hugely successful technology companies, Apple and Pixar (bought later by Disney). He is an expert innovator and very passionate on innovation and technology advancements. His work ethics and visions are legendary. Unfortunately, health of a human being is never certain no matter how much success and money a human has. We all should be grateful for his huge contribution so far to the technology & media landscape and wish him a great and sustainable health recovery. Steve Jobs' life story is inspirational. He came from a humble beginning. He was an orphan and a dropped-out college student. Read more...

US Treasury recently proposed highly anticipated Financial Regulatory Reform: A New Foundation. Here is the paper. New era is coming to Wall Street.

People love to play games for the sake of excitement. Hence, it is not surprising that many individuals (especially the ones who think they are smart) generally like to manage their own investments thinking they can outperform key market indexes year after year. Unfortunately, many tried and failed. Many more are still trying without meaningful results. Hence, majority of them finally (after multiple trials & errors & failures) and eventually hire qualified investment managers whom they trust to manage their investment assets. They invest in mutual funds, hedge funds, and separately managed funds. Read more...

Warren Buffett once said "Most people get interested in stocks when everyone else is. The time to get interested is when no one else is. You can't buy what is popular and do well." We read this quote again and again, and now even more convinced that the US and global markets are on the road of true recovery (albeit a slow one in the developed countries). The US market bottoms have been reached twice in October 2008 and March 2009 (appears to be double bottoms already.) Unless traders and investors are waiting for tripe or quadruple bottoms (unlikely in our view), we are already in early recovery phase (at least from stock markets level since markets are discounting mechanism). The economy is also getting a bit better. Read more...