Kiplinger's Magazine: Ten Cash Cows

Here is an excerpt of an article from Kiplinger’s Magazine listing ten large-cap companies that should do well over the next ten years:

1) Procter & Gamble (PG): Daily grooming products, 10% earnings, div + yield

2) Electronic Arts (ERTS): World’s biggest video-game software company. Sales and earnings over 21%.

3) First Solar (FSLR): American government subsidized. Alternative energy will be especially popular if oil prices rise. 56% earnings; efficient production process.

4) Gilead Sciences (GILD): HIV and other portfolio of drugs, robust growth.

5) Google (GOOG): 22% earnings. Internet giant with advertising revenues.

6) Monsanto (MON): 41% earnings. Technology lead and worldwide sales.

7) Norfolk & Southern (NSR): More efficient than rival railroad CSX.

8) T Rowe Price (TROW): low costs, profits of 15-39% annually.

9) Schlumberger (SLB): world’s largest energy services &exploration company, 12 % earnings.

10) Visa (V): world’s largest payment processor, recent IPO, more business expected.

We can check this list in a decade and see which ones did as well as propounded (if we remember).

By the way, not a single one of these stocks has achieved more than O% gains in a one-year chart. Going back years they look far more compelling.

Most important, they are all considered by Kiplinger’s to be very well-capitalized to survive a challenging marketplace. Oct. 31, 2008

http://www.kiplinger.com/features/archives/2008/08/ten_great_stocks.html?kipad_id=5?kipad_id=5?kipad_id=5?kipad_id=5

On procrastination

He was a genius - that is to say, a man who does superlatively and without obvious effort something that most people cannot do by the uttermost exertion of their abilities.
- Robertson Davies

This is a quote by a famous Canadian author (1913-1995). Certainly applies to a professional mathematician.

I am ruefully wondering if this applies to dieting, as well, if only geniuses can do it?

Here is a short article excerpt about procrastination and doing what we don't wish to do (whether we can or not).

"The world is designed to create procrastination problems," says Dan Ariely, Ph.D., James B. Duke professor of behavioral economics at Duke University and the author of "Predictably Irrational."

"Our emotions get the better of us, and we tend to forsake our long-term goals in favor of short-term desires. It's a major source of human misery."

Ariely surveyed almost 3,000 Oprah.com users to explore how procrastination toys with our lives. He found that while people have a general tendency to drag their feet, certain tasks are real "back burners" for pretty much everyone.

Of the 12 activities listed (including chores like holiday shopping, paying bills, and scheduling doctors' appointments), exercising and starting a diet are the two people put off the most, topped only by evaluating their retirement plan.

Work duties like completing assignments and returning voice mails are attended to much more promptly. Even when people express a willingness to deal with their most avoided to-dos by setting deadlines, the data revealed, they are likely not to follow through.

"Just recognizing the problem," says Ariely, "is the first step to overcoming it." *

A helpful strategy offered to try to outsmart the temptation of short-term desires would be to use constant reminders of your mission to keep from deferring it. For example, it is suggested using lists and mirrors of yourself as diet reminders."

What could work is to use whatever has helped one succeed in anything in the past. (I can type this since my current diet is succeeding albeit with professional supervision and this distracting hobby).

Also, one should be conscious of all decisions. Poor decisions, like naughty pets, could come back to bite you...

http://www.cnn.com/2008/LIVING/personal/10/28/o.beat.procrastination/index.html

Cambodia, Kingdom of: A Short Summary

Differentiating Facts:

1) Cambodia is best visited between November and January (or March). Rainy monsoon season runs from May to October. Tourism expanded to 4 mil in 2007. There are still border disputes with Thailand.

2) 90% of Cambodians are Khmer in origin. Schools and universities are often funded by France. Cambodian French, a dialect used by the government is being replaced with English as a business language.

3) Wide variety of plants (including rices) and wildlife. Rice self-sufficiency returned in 2000. Rainforest fell from 70% of Cambodia in 1970 to 3.1% in 2007.

Historical and Geographical Facts:

1) Also briefly known as Kampuchea (1975-1979). Largest city is Phnom Penh. It is the successor state of the powerful Khmer and Buddhist Empire of the 11thC to 14^th C. centered in Angkor. Angkor Wat, a major tourist draw, is a religious temple, a reminder of Cambodia’s past as a major regional power.

2) Geography is dominated by the Mekong River and (Lake) Tonle Sap. Most of the country is less than 330 ft (100 m) above sea level, although the center has the highest mountain, Phnom Aoral, elev. 5,948 ft (1,813 m).

3) Bombings during the Vietnam War and dislocations (and genocide) during the Civil War of 1975 created widespread famine and need for reconstruction. "As events in the 1980s progressed, the main preoccupations of the new regime were survival, restoring the economy, and combating the Khmer Rouge insurgency by military and by political means."*

Economic Facts:

1) Main industries are tourism (quickly expanding), fish, textiles, timber and construction. Has one of the highest deforestation rates in the world. In 2005, oil and natural gas were discovered, and could affect revenues in 2011.

2) Much of the countryside lacks basic infrastructure, because of years of political instability and severe repeat flooding. There are limited rail lines, and highways and bridges are improving. Automobiles, waterways, ports and airports are having increasing use.

3) Stability has been aided by Japan, France, West Germany, Canada and Australia (and others), but not as much by the United States and Great Britain due to Cambodia's relationship with China, one of its greatest trading partners. Some foreign aid is thought to be channeled into personal accounts, and more transparency is required to achieve greater prosperity.

General Facts:

1) Politics are conducted within the framework of a constitutional monarchy and parliamentary representative democracy. King Norodom Sihanouk has been involved with running the country since 1953 (much of the time) as either King or Prime Minister. In 2004, he abdicated the throne and was replaced by King Norodom Sihamoni (selected by a nine-member throne council).

2) UNICEF designates Cambodia as the third most land-mined country in the world. Considered among the world’s most corrupt country on most lists, 2^nd most in South East Asia (with Myanmar) after Laos.

3) Median age is 20.6 years, and half of the population of 14 million is less than age 25.

Further travel information is available at Wikitravel.

http://wikitravel.org/en/Cambodia




Source: http://www.google.com/search?q=cambodia+wiki&sourceid=navclient-ff&ie=UTF-8&rlz=1B3GGGL_enUS267US268

*http://en.wikipedia.org/wiki/Democratic_Kampuchea

Vietnam, the Socialist Republic: A Short Summary

Differentiating Characteristics:

1) Agricultural civilization based on wet rice cultivating is modernizing. Influenced by China, Vietnamese emphasize the values of filial duty, education and self-betterment

2) Controlled media. Tourism and the film media are expanding.

3) Long notable for stilt dwellings, bronze tools and drums, betel-nut chewing and teeth-blackening.

Historical and Geographical Facts:

1) Under Chinese control until 10^th C, successive dynasties followed by French in mid-19^th C. became part of French Indochina in 1885. Invaded by Japanese in WWII. First Indochina War 1946-1954, between Soviet-backed Viet Minh and French forces. Communists gained ground until Vietnam War ended with a communist victory in 1975 (see also Laos).

2) Postwar, humanitarian crisis occurred caused by collectivization of private lands and businesses and widespread arrests. Vietnam invaded Cambodia in 1978 to remove Khmer Rouge and relied again on Soviets when China invaded North Vietnam. Ravaged by war, reformed in a big shift by communist leaders in 1986, economy revived with privatizations and grew fast. Diplomatic ties returned by 2000, joined World Trade Organization in 2007, and the United Nations Security Council in 2008.

3) Larger than Italy, almost the size of Germany. Pop. 86 mil. Mostly hills and mountains, level land: 20%. Mekong Delta changes in size naturally. Monsoonal climate: winter or dry season is roughly from November to April. Has established many conservation areas, for the study of species diversity.

Economic Facts:

1) Achieved recent rapid growth in agricultural (rice, coffee, tea, cashew nuts, fish and rubber) and industrial production, construction, housing, exports and foreign investments. Vietnam is still a single-party state while transitioning to a market economy.

2) The role of the military has reduced substantially since the 1980s. “Although the state remains officially committed to socialism as its defining creed, the ideology's importance has substantially diminished since the 1990s.”*

3) The road system is the most popular form of transportation, by bicycle, scooters, and motorcycles. Public bus operated by private companies offer long-distance travel. Automobiles are booming and causing congestion. Waterways and seven ports are significant.

General Facts:

1) Buddhism became the dominant religion. Traditional wedding is the most important celebration, with traditional garments worn.

2) In 1804, King Gia Long named it “Viet” (for a large ethnic group) and “Nam” for “the south” (as opposed to China, “the north”).

3) English study is obligatory in most schools. There is a state-controlled network offering free instruction only until age 11, then it is private. Sports are popular. Vietnam has its own art, theater, dance, literature and music.

*Source: http://en.wikipedia.org/wiki/Vietnam

Huge Up Market

"I've looked at chart after chart after chart, and what my (relatively objective) eyes tell me is that everything is about to go up. Gold. Silver. Oil. Wheat. Kitty Litter. Equities. Everything."...
from Slope of Hope (blog) by Tim Knight. http://www.slopeofhope.com/

Now I am hearing that it is the time to buy. It will likely go up before it goes down. Just saying.
It was an amazing day on the market.

		Dow	9,065.12	+889.35	(10.88%)
		S&P 500	940.51	+91.59	(10.79%)
		Nasdaq	1,649.47	+143.57	(9.53%)

Laos, Lao People's Democratic Republic: A Short Summary

Differentiating Characteristics:

1) Home of significant large wildlife, the Indochinese tiger, the giant gaur, the Asian elephant, historically called the Lan Xang, “Land of a Million Elephants” from the 14^th to 18^th C.

2) Opium poppy is an important crop. “During the Vietnam War, the vast majority of the opium produced in Laos was consumed by US soldiers” – Wikipedia.

3) Not a free press society: all newspapers are published by the socialist republic government including two foreign language papers. While Internet cafes are common in urban centers, the government censors content and controls access.

Historical and Geographical Facts:

1) Laos was dragged into the Vietnamese War (1970s) and suffered from bombings and heavy loss of life. In 1975, King Savang Vatthana abdicated and later died in captivity, after which Laos became a communist country with military leadership. In its current ideology, "the [communist] party would allow economic freedom and a degree of cultural freedom but would not allow anyone to question the rule of the party over the country."*

2) Lao monarchies ruled until 18^th C Siamese suzerainty. Laos became a French protectorate in the 19^th C, Japanese during WWII, and then French again until 1955. The U.S. Dept of Defense then replaced French support of the Royal Lao Army, supported (unsuccessfully) the South Vietnamese invasion of Laos and a Civil War between the Royal Laotian government and communist Pathet Lao.

3) Mountainous country. Monsoonal climate. 21% of the nation’s area is parkland.

Economic Facts:

1) Vietnam cut off Laos from trade with China and other countries except Vietnam in late 1970s. Economic restrictions relaxed in 1980s with admission in ASEAN in 1997. U.S. established Normal Trade Relations with Laos in 2005.

2) Agriculture accounts for half of GDP and 80% of employment, although only .34% of land is planted with arable crops, and 4.01% of Laos has arable land. 77% of households are self-sufficient in rice. Laos may have the largest number of rice varieties in the Greater Mekong Subregion.

3) IMF and foreign investment give important aid in food processing and mining of gold and copper. Tourism is the fastest growing industry in the country. Currency: Kip.

General Facts:

1) Laos lacks adequate infrastructure, no railroads, limited communications. Pick-up trucks with benches are used for both long-distance and local public transport.

2) Buddhism is a dominant influence in Lao culture, predated by “lam” the dominant style of folk music, accompanied by the “khaen”, a bamboo pipe.

3) The ‘s’ is Laos is silent. Laos rhymes with "wow". Lao is the name of the language and the “Lao” economy. “Laotian” is an inclusive political term concerning citizenship, rather than the Lao ethnic group.

Source: http://en.wikipedia.org/wiki/Laos

*http://en.wikipedia.org/wiki/Lao_People%27s_Revolutionary_Party

Amusing video

Someone drew my attention to the following video from the U.K. about the "subprime mortgage mess". It's well worth watching.

http://www.youtube.com/watch?v=UC31Oudc5Bg

Prescient and amazing that it came out in 2007 before the recent turmoil.

By the way, even international big ships moving goods have stopped according to a Bloomberg segment on television today. They can't get the loans they need...

WSJ: What It Means to 'Manage Up', by Elizabeth Garone (excerpt)

..."Knowing your manager's style -- and adjusting your own to meet it -- will help you manage up, she says.

...There are plenty of other easy steps you can take to become adept at managing up, according to Ms. Edwards. Important ones include: paying attention; jumping in when needed; maintaining a good attitude no matter what; doing quality work; keeping your boss informed; building relationships, trust and an information network; staying out of politics; learning the art of selling and negotiation as well as the company's rules; and being a good follower when the situation dictates it.

With today's shaky economy, learning to manage up is more important than ever"....

..."you want to be categorized by management and your company as someone too valuable to lose"* said Rosanne Badowski, the executive assistant to Jack Welch when he was CEO of GE and author of a book about "managing up".


*The Wall Street Journal

Thailand: A Short Summary

Differentiating characteristics:

1) Name was Siam until 1939. Had able rulers and was not colonized from outside.

2) Respect for elders essential to Thai’s spiritual practices as well as daily lifestyles. Social hierarchy important. Greeting “wai” offered first by youngest and visitors as a sign of respect: fingertips pointing upwards as the head is bowed to touch face to hands.

3) Religion is 95% Buddhist. Hospitality and generosity are also important.

Historical and geographical facts:

1) Thailand, a constitutional monarcy, means “Land of the free”. Has never been colonized by a European power, is a regional buffer state and an American ally. On December 23, 2007, achieved democracy with a King and Prime Minister, a 1997 constitution and elected government (after quelling organized military resistances).

2) Size of California, world’s 50^th largest country. North: mountainous, center: flat, south: Kra Isthmus and Malay Peninsula.

3) Tropical climate characterized by wet monsoons mid-May to September, dry, windy monsoons November to mid-March. Southern isthmus is always hot and humid.

Economic facts:

1) World’s No. 1 exporter of rice (jasmine is their favorite), also manufacturing electric appliances, computer parts and automobiles. Currency: Baht. Thailand has an “Immemorial tradition of trade”.*

2) Buddhism and temples are tied to lives of Thais. Sons are often educated with monks. Government provides free education through grade 12, and there is a private system as well.

3) Books are revered. Thailand has the largest newspaper market in South East Asia.

General facts :

1) Bangkok, capital and largest city pop: 10,061,726. Recent geological surveys suggest that the giant tsunami that hit Thailand and the South Pacific region December 26, 2004 was a one-in- 600-year event.*

2)” English, on the increase at least in quantity if not in quality”** is a mandatory school subject, but fluent speakers remain low, especially outside cities.

3) Years are numbered B.E. (Buddhist Era) in education, civil service, government, newpapers. Banking, industry are increasing use of Western year. 2008 is 2551 B.E.

*http://www.usatoday.com/news/world/2008-10-29-tsunami_N.htm?csp=34

**Source: http://en.wikipedia.org/wiki/Thailand

Barron's - Close but No Cigar, by Alan Abelson (excerpt)

What especially animates the 2008 election is the emergence of two babes in the political woods: the Dems' choice for the presidency and the GOP's audacious selection for the vice presidency.

Barack Obama may lack any substantive experience in running anything except water, but that's more than counterbalanced by the fact that since he was a lad of 7 or 8, when other kids were busy in such idle pursuits as playing baseball or throwing eggs at cars, he had his heart set on being president of these United States.

Preparing for that role required a misspent youth reading and writing and keeping slim. Yet come Nov. 4, 40 years of such disciplined drudgery might end up either paying off or forcing him to try something novel: gainful employment.

And then there's the magical rise of Sarah Palin. Miss Congeniality is transmuted into Miss Fancy Pants. Just shows you what can happen to that nice little girl next door when she gets the tiniest taste of the high life that comes with being a major-league pol.

There she was, happy as a clam or a polar-bear cub doing a little governing of Alaska (mean and dirty work, but someone has to do it), shooting the odd moose, raising a family and keeping an eye on the Russkies, only a hop, skip and jump across a frozen expanse of sea.

Then comes the call and, patriotic to the core, spunky Sarah answers it. She bids a sad goodbye to her jeans, sloppy shirt, mackinaw, deer-skin earmuffs, fur-lined mittens and bunny boots, and heads for that twisting campaign trail that leads to Washington, D.C.

But she can't go around rallying the folks to vote for her and old John in her birthday suit. So she hits all those snooty stores with funny names like Saks Fifth Avenue, Bloomingdale's, Neiman Marcus, Barney's and Atelier, and dudes up herself, hubby and the kids. She tries on the frocks and she looks like a million bucks, which is about what they cost.

Actually, all that spiffy stuff came to a mere $150,000. But dear little Sarah never gave it a moment's thought because a kind gentleman named Larson appeared out of the blue, like in one of those fairy tales, and picked up the tab. And before she had a chance to say thanks, along comes a famous charitable organization known as the Republican National Committee and insists on paying back Mr. Larson every single penny of the $150,000.

And when word of her shopping and all got around, darned if she didn't receive some of the nicest phone calls. One came from a fellow named John Edwards, who wanted to know where she got her hair done and how much it cost.

It all made Sarah proud as anything of her country and jump with joy, relishing how much fun she'd have as vice president. Beats her why Vice Presidents Dick Cheney always looks like such a grump and Al Gore such a schmo. Maybe they hated shopping. Or maybe it was just that they had been so silly as to have thought it was a real job.

BUT, SIGH, EVEN THE ELECTION doesn't provide much of a distraction from the grave condition of the markets, lying comatose in intensive care, with a highly problematic prognosis. If anything, in fact, as John Harris, a reader and market historian, demonstrates, the election is a further cause for concern.

What Goes Up Must Come Down

Just to bring this global downturn into perspective, this chart I made (BigCharts.com) of mutual funds from the last ten years shows the size of the Nasdaq tech bubble of 2000 and the recent huge run-up and crash of the bull market with former winning high-flyers:

VGPMX (Vanguard Precious Metals)
FSEAX (Fidelity South East Asia),
VEIEX (Vanguard Emerging Markets)
FSAGX (Fidelity Select Gold)

VPMCX (Vanguard Prime Cap) has been a steady grower over the last twenty years but it has lagged since 2000 and has just been hit hard again (-34% YTD).

Even GLD (SPDR Gold Trust) (ETF) has lost some of its value, although it is up over four years.

Only shorting funds have gone up well lately, and that is definitely NOT "a good thing" for the market.



What goes up must come down.

How often do we hear that and not want to believe it!

If it sounds too good to be true, it probably is. What we know from the charts is that -- if it looks too good to be true, it probably is. The truth sometimes hurts.

I was wrong to say in my earlier post that gold could go up. I was wrong, and I apologize, because that is something that has worked for me as a hedge in the past.

The rules are changing again. This time is different. We're in uncharted territory (I seem to be using platitudes here). The time to "sell your losses" is probably past.

Hope your investments, if they've gone down as most have, are not making you morbidly upset.

Make a new plan to enjoy and to look forward to. Plans are big soft cushions in adversity -- nice and relaxing and good value for money.

Look forward. Be pro-active. Pick yourself up and run. Hey, you're alive.

Be good to your family and friends because this too shall pass.

The old adages still hold: work hard, plan ahead. Trust me. The pain will subside. It really will.

Hot New Jersey

Governor Corzine, our political chief, gives lots of New Jerseyans a good feeling. After all, he gave up a Democratic Senate seat to be our Governor, after being Chairman of Goldman Sachs, a position also held by Henry "Hank" Paulson. Finally, we have a fiscal leader in Governor Corzine, on the assumption that not only is he an exceptional financial expert, but having made a significant fortune, he doesn't have any motives to accept bribery and corruption. And it looks like we may also have an energy leader...

Associated Press
New Jersey governor introduces energy master plan
By ANGELA DELLI SANTI 10.22.08, 6:03 PM ET

TRENTON, N.J. -

Gov. Jon S. Corzine has laid out a vision for New Jersey's energy future.

The proposal issued Wednesday includes an increasing reliance on renewable sources like wind and solar power, creating clean-energy businesses and jobs and lowering energy costs and consumption.

The state's new Energy Master Plan is the first update in a dozen years.

"With one of the strongest solar programs in the nation, potentially the country's first offshore wind project in the works ... and the most aggressive greenhouse gas emissions reduction targets in the nation, New Jersey has taken the lead," [my boldface type] the governor said.

Corzine chose to unveil the plan at Isles YouthBuild Institute in Trenton, which trains high-school students for high-demand jobs like those in clean energy.

The governor said he envisions clean energy as a major driver of New Jersey's economy....*

Forbes.com

Good to know that New Jersey is taking the lead in something, besides being the state having the greatest density of millionaires and houses in the nation, and lots more.

This isn't just a lot of hot air. New Jersey is a wonderful state to live in. We are proud of our Governor and grateful to him for taking this courageous leadership role.

Buy Worldwide, We Should.

Industrials Jump 400
On Hints of Thaw*

"Stocks advanced as credit conditions showed signs of stabilizing and Bernanke signaled that he supports a second round of fiscal stimulus."*

Market Data Center 6:31 p.m. Monday, October 20, 2008 DJIA* 9265.43 413.21 4.67% Nasdaq* 1770.03 58.74 3.43% S&P 500* 985.40 44.85 4.77% 10-YR Note* 3.865 19/32 0.58%

*Wall Street Journal

Not a bad day, but how long will the good times roll? Last week was so shocking in the market that it has everyone spooked that it could happen again. Volume was low across all indexes in the U.S. today.

CNBC (TV) is reporting that a short term low has definitely been achieved, but there's the rub, how long is "short term"? No one can say. There aren't any guarantees in the stock market.

Warren Buffett has just written a very influential article in The New York Times entitled,
"Buy America. I Am" http://www.nytimes.com/2008/10/17/opinion/17buffett.html?em
October 16, 2008 saying basically that now is the time to buy.

Okay, we get it. We like the encouragement. More power to Warren Buffett. But, this is a very severe recession, unlike anything he has invested in before now. Besides, he has lots of money to play with.

Excuses, excuses!

We'll see. We remember that hope does not have any monetary value. We just have to wait and see that indexes go up...or down.

Let's be optimistic and hopeful, anyway, even if there isn't any monetary value in it. Maybe we will be lucky...

"Most Profitable Home-based Businesses" in America 2008 - Forbes Magazine

1. Securities and Commodity Brokers

Average Pretax Profit Margin: 14%

2. Software Publishers

Average Pretax Profit Margin: 14%

3. Artists, Writers, Performers

Average Pretax Profit Margin: 13%

4. Insurance Agents and Brokers

Average Pretax Profit Margin: 13%

5. Specialized Design Services

Average Pretax Profit Margin: 11%

6. Consulting Services

Average Pretax Profit Margin: 10%

7. Personal and Household Goods Repair and Maintenance

Average Pretax Profit Margin: 10%

8. Offices of Real Estate Agents and Brokers

Average Pretax Profit Margin: 9%

9. Electronic and Precision Equipment Repair and Maintenance

Average Pretax Profit Margin: 9%

10. Grant Making and Giving Services

Average Pretax Profit Margin: 8%

My apologies for the uneven type which I cannot seem to correct.

The only one that surprised me is #7, where shoe repair shops are cited as the next big “home-based business”!

Further information is at the article here:

http://www.forbes.com/2008/10/14/profitable-home-businesses-ent-fin-cx_mf_1014mostprofitablehomebiz.html?feed=rss_news

Most generous corporations - Forbes Magazine

Forbes has just published two lists of the ten most generous corporations, one by percent of company income, and the other by actual cash donations. Here is a list of the names together.
Big round of applause time!

Most Generous Corporations - Cash Donations:

No. 1: Wal-Mart Stores

2007 cash donation: $301 million

No. 2: Bank of America

2007 cash donation: $211 million

No. 3: Exxon Mobil

2007 cash donation: $173 million

No. 4: Citigroup

2007 cash donation: $146 million

No. 5: Johnson & Johnson

2007 cash donation: $127 million

No. 6: Chevron

2007 cash donation: $122 million

No. 7: AT&T

2007 cash donation: $119 million

No. 8: General Electric

2007 cash donation: $114 million

No. 9: Microsoft

2007 cash donation: $110 million

No. 10: Wachovia

2007 cash donation: $103 million

Most Generous Corporations - Percentage of Income:

No. 1 Kroger

1.7% of operating income
2007 cash donation: $57 million
2006 operating income: $3.3 billion

No. 2 Tyson Foods

1.6% of operating income
2007 cash donation: $8 million
2006 operating income: $492 million

No. 3 Bristol-Myers Squibb

1.4% of operating income
2007 cash donation: $59 million
2006 operating income: $4.1 billion

No. 4 Best Buy

1.4% of operating income
2007 cash donation: $31 million
2006 operating income: $2.2 billion

No. 5 Eli Lilly

1.3% of operating income
2007 cash donation: $70 million
2006 operating income: $5.4 billion

No. 6 Wal-Mart Stores

1.3% of operating income
2007 cash donations: $301 million
2006 operating income: $23.6 billion

No. 7 Fluor Corp.

1.2% of operating income
2007 cash donation: $10 million
2006 operating income: $531 million

No. 8 Xerox

1% of operating income
2007 cash donations: $25 million
2006 operating income: $2.5 billion

No. 9 Caterpillar

0.9% of operating income
2007 cash donation: $74 million
2006 operating income: $7.8 billion

No. 10 Northrup Grumman

0.9% of operating income

2007 cash donation: $30 million

2006 operating income: $3.2 billion

Interesting how diverse these companies are. They are not all, say, grocery stores. Also, it is interesting to note how different the companies on the lists are. Only Wal-Mart and Exxon-Mobil make both lists.

Here's the full article:
http://www.forbes.com/home/2008/10/16/most-generous-corporations-corprespons08-lead-cx_mk_1016charity.html

This morning, I have been reading "Slope of Hope" again, and Tim Knight's prediction is that the market might begin to turn around the week of Oct 20 when it could also reach new lows. Yikes!

This morning, I also watched CNBC's excellent all-star panel for the most part of an hour 8-9 a.m. with Paul McCulley - Pimco, Abby Joseph Cohen - Goldman Sachs, Jack Bogle - Vanguard, Bob Doll - BlackRock. Fortunately, it is reprinted and video-ed at CNBC.com.

http://www.cnbc.com/id/27214096

Here are my favorite excerpts of their most memorable lines:

Paul McCulley, Pimco Managing Director

"I do think that we have, in place, the right set, finally, of government policies to counter this paradox of deleveraging," McCulley said.

"The reasons for optimism, if you want to be optimistic, and I do, is that you've seen the right kind of (government) response," he said. "They are going to stand up to the challenge in a very forceful way."

Abbey Joseph Cohen, President of Global Markets Institute at Goldman Sachs

The U.S. economy should start to see growth in mid-2009 and it will start to show signs of improvement in early spring next year, Cohen said.

If the global policy actions "are effective, we'll start to see the system unfreezing," she said.

Jack Bogle, Vanguard Group Founder

"This is my tenth bear market and what's different about this one is that the problems of the financial markets are spreading over to the real economy," Bogle said.

"Stay the course".

Bob Doll, BlackRock Chief Investment Officer

The government actions have gone a long way to helping the financial situation and the governments need to follow through so the markets can move on to the "normal" issues of recession, Doll said.

"I'd say things are improving," Doll added. "Forced selling will continue but probably at a lesser pace…volatility will remain but probably in two years from now we'll look back and say why didn't I buy more stocks in October 2008?"

As expected, they are saying to begin to buy again, even though this and the next few quarters don't look "pretty".

Crystal Healing School for Royal Clairvoyants

Monarchies are harmless as long as one doesn't have to pay for them. Here's what one Royal is doing...

http://www.aftenposten.no/english/local/article1901846.ece

Princess Märtha Louise claimed to have "seen the light" in 2002, when she married author Ari Behn in a lavish royal wedding at the cathedral in Trondheim.

PHOTO: TOR RICHARDSEN/SCANPIX

Norway's Princess Märtha Louise, daughter of King Harald and Queen Sonja, has emerged as a clairvoyant, and is launching an alternative school aimed at training students to contact angels. Officials at the Royal Palace won’t comment on the princess' latest business venture.

...The princess' business partner has publicly confirmed the training program, which is billed as a means of "getting in touch with your own truths" through "readings, healing, crystals and hands-on treatment."

...The 35-year-old princess was educated as a physiotherapist, trained as a Rosen therapist and also has studied at an academy for holistic medicine "where I learned to systematize sensual impressions to read others, and through horses I learned to communicate with animals on a deeper level."

Märtha Louise, who competed in equestrian events for several years, said that she started "taking contact with angels" when she worked with horses. "I have later learned the value of this enormous gift, and want to share it with others," she said.

...The princess has launched Astarte Education with a friend, Elisabeth Samnøy, who describes herself on the website as a former ship mechanic who also attended a holistic academy.

...The pair concedes that their training program isn't sanctioned by Norwegian education authorities. Courses will be offered twice a week over three years, at a cost of NOK 12,000 per half-year.Students are obligated to sign up for at least one year at a time.

Original. For those who have the "gift"!

On The Global Competitiveness Report 2008-2009

Last weekend I visited Toronto, Canada, and have just returned. All over their news is the World Economic Forum's list of most "sound" banks by country, where Canada comes first and the U.S. comes 40th. Have to agree, "soundness of banks" is a desirable list for Canada to lead! This hasn't been in the news much in America. (I wonder why!)

At the same time, it should be favorable news, because the United States came in first in global competitiveness overall. Switzerland is second overall and also in "soundness of banks" where it was first last year. Scandinavian countries ranked generally third. Canada is in tenth place (which is not emphasized in the news there!)

The Report at the World Economic Forum's website is interesting to read and has a fascinating series of lists at http://gcr.weforum.org/gcr/. They rank such wide-ranging areas as public and private institutions, health and education, financial institution sophistication, infrastructure, labor markets, goods and labor markets, innovation, just the range of society (mind-boggling in ambition).

The list of "best performing countries" is not just instructive, but amusing in achievement. Female participation in the labor force is highest in Mozambique this year and education expenditure is highest in Lesotho. Who knew?

It's thought-provoking as well. How can Denmark lead in three seemingly opposing areas: "diversion of public funds" "favoritism in decisions of government officials" AND "efficiency of legal framework" ?

It's amazing how fast these rankings can change. After all, these qualities would appear difficult to rank at all, let alone to change rankings yearly.

Can rankings be challenged, if they are taken seriously? Who has final say?

Some rankings are not completely desirable, such as the aforementioned "favoritism" by government officials or "brain drain" where the U.S. ranks highest.

Why not also rank length of time and difficulty to obtain visas and immigration papers?

If they tried to rank "most desirable country to live in" what qualities would they use?

Some quality of life issues are impossible to rank. Or maybe not, according to the World Economic Forum. But it doesn't mean they are correct. Current events change them all the time.

Dow's Best Point Gain And Percentage Climb Since 1933

Today is looking like a rally with the Dow up 331.58 to 8782.77 nearly 4%!!! That sentence was typed at 10 a.m. Even better, the Dow was up over 11% by 4 p.m., the end of the trading day. From The Wall Street Journal:

Stocks snapped a brutal losing streak in resounding fashion as the Dow Jones Industrial Average enjoyed its biggest one-day point gain ever following new moves by governments to shore up the global financial system.

The Dow leapt 936.42 points, or 11.1%, to 9387.61. The rally ended an eight-day slide in which the blue-chip measure plummeted almost 2,400 points and endured the worst full-week performance in its 112-year history. Monday's move was the best one-day closing point gain ever for the Dow and its biggest one-day percentage climb since March 15, 1933.

Hope springs eternal...

Nobel Prize-winner Paul Krugman's "Gordon Does Good" article

The New York Times currently has fine reporting with one of its reporters, Paul Krugman, today capturing the Nobel Prize for Economics. Wonder how Federal Reserve Bank Chief, Ben Bernanke, feels; both Princeton University Economics faculty. May he get one too!

Paul Krugman's article "Gordon Does Good" in The Times today illuminates the banking issues at the heart of the American financial crisis and posits that the U.K. has taken on a leadership role:

http://www.nytimes.com/2008/10/13/opinion/13krugman.html?hp

Here are my favorite excerpts:

What is the nature of the crisis? The details can be insanely complex, but the basics are fairly simple. The bursting of the housing bubble has led to large losses for anyone who bought assets backed by mortgage payments; these losses have left many financial institutions with too much debt and too little capital to provide the credit the economy needs; troubled financial institutions have tried to meet their debts and increase their capital by selling assets, but this has driven asset prices down, reducing their capital even further.
...to deal with the problem of inadequate financial capital by having governments provide financial institutions with more capital in return for a share of ownership.

This sort of temporary part-nationalization, which is often referred to as an “equity injection,” is the crisis solution advocated by many economists — and sources told The Times that it was also the solution privately favored by Ben Bernanke, the Federal Reserve chairman.

But when Henry Paulson, the U.S. Treasury secretary, announced his plan for a $700 billion financial bailout, he rejected this obvious path, saying, “That’s what you do when you have failure.” Instead, he called for government purchases of toxic mortgage-backed securities, based on the theory that ... actually, it never was clear what his theory was.

...Meanwhile, the British government went straight to the heart of the problem — and moved to address it with stunning speed. On Wednesday, Mr. Brown’s officials announced a plan for major equity injections into British banks, backed up by guarantees on bank debt that should get lending among banks, a crucial part of the financial mechanism, running again. And the first major commitment of funds will come on Monday — five days after the plan’s announcement.

At a special European summit meeting on Sunday, the major economies of continental Europe in effect declared themselves ready to follow Britain’s lead, injecting hundreds of billions of dollars into banks while guaranteeing their debts.

...Mr. Paulson — after arguably wasting several precious weeks — has also reversed course, and now plans to buy equity stakes rather than bad mortgage securities.

...All across the executive branch, knowledgeable professionals have been driven out; there may not have been anyone left at Treasury with the stature and background to tell Mr. Paulson that he wasn’t making sense.

Luckily for the world economy, however, Gordon Brown and his officials are making sense. And they may have shown us the way through this crisis.

It's an excellent article from Paul Krugman, now an even more influential journalist, after this morning's announcement of his Nobel Prize, and I am sure it reflects very well on The New York Times and other journalists there as well.

It also reflects well on Princeton University where he is professor of Economics and International Affairs, and more celebrated than ever.

Interesting that the Nobel Committee must have had its eye on him for at least five years "for his work on global trade patterns".

Lawmakers and government finance heads must actually and in real time "do the right thing" with lasting consequences, very serious achievements in my view. Let's hope they too get their just rewards.

There aren't enough Nobel Prizes to go around. It is, as always, a gift.

I haven't posted investment advice lately, because the market is being uncertain, to say the least. Rather than heading straight up, most investors have been subjected to head-spinning, shockingly swift downward results in their portfolios.

We would prefer to be in a healthy market. Even most gold funds, our usual friends in market routs aren't buoying up as they have in the past. GLD, the SPDR Gold Trust (ETF) (NYSE) is an exception.

The market is still going down, and there is not any clear indication to me that it is heading up again soon. Of course, it could. Eventually, it will.

I keep reading the (now gloating) writing of Tim Knight at his blog "Slope of Hope"
http://www.slopeofhope.com/. For instance, now he is saying that we are setting "ourselves up for the greatest trading environment for bears of all time". He tends to be mostly bearish while I prefer to accentuate the positive. Here is a chart of the S&P 500 down over 20% since September 1, 2008.




Seriously, okay, the stock market is bad, really bad, but it can't last that way forever, and it is certainly not the fault of any one individual money manager. History will dissect and take apart this market downturn, and show that there are very few bull funds that have gone up, probably none.

Those who have become accustomed to supporting an uptrending, seemingly healthy market by depositing hard-earned savings are being challenged and disappointed more than ever before by this market environment.

Few of us were even around during the fabled Great Depression. This is the worst most of us know, and it feels a lot like the aftermath of September 11, 2001. It's different because it's financial, and there is so much diffuse weakness all around the country.

Will commercial lenders help small business owners make their payroll? If first time homebuyers can't get mortgages, the entire line-up of mortgage lenders and those with any connection to real estate in any way, shape or form feel the pain. Who will get elected, and how will their administration handle the war in Iraq and the federal deficit?

Ginormous questions, so much uncertainty, and we must wait for the answers. But we will, and there are now exceptionally fine buying opportunities.

Aquamarines and the World of Precious Gemstones

Here's an idea: Why not buy precious beads yourself and have them created into beautiful necklaces? If not for yourself, they would make beautiful gifts for your loved ones. It's always good and fun to know more about precious rocks.

The following websites have general information about gemstones, where to buy them in different sizes and shapes, even a chunk of the original rock, and healing properties. There are many thousands of websites like these. Gemstone research opens up the fascinating world of gemstone information, sources and organized international Gemological Societies.

This is a website about choosing gemstones for a loved one by businesswoman Kathy Ireland, where she says:

Becoming familiar with the many gemstones available will help with your decision in choosing a stone. The more familiar you are with your options, the easier it will be to find the gemstone that perfectly captures how special she is to you.

Browse through the Birthstone Calendar to see which gemstone corresponds with her birth month. Maybe she’s always wanted a piece of jewelry with her month’s stone. Or maybe she’s always been in love with a particular colored stone. Maybe you can find a beautiful piece of jewelry adorned with the stone from the month you two first met. The nice thing about the gemstone calendar is that you can wear any stone from any month, and it doesn’t matter to the jewelry world.

http://www.kathyireland.com/ContentSystem/ArticlePage.aspx?ArticleID=1784&CatID=96

Gemstones have long been assigned to calendars and they often differ. Here's one I have seen for a long time:

Month	Traditional Birthstone(s)[3]	Modern Birthstone(s)[3]	Mystical Birthstone	Ayurvedic Birthstone
January	garnet	garnet	emerald	garnet
February	amethyst	amethyst	bloodstone	amethyst
March	bloodstone, jasper	aquamarine	jade	bloodstone
April	diamond, sapphire	diamond	opal	diamond
May	emerald, agate	emerald	sapphire	agate
June	alexandrite, emerald	moonstone, pearl	moonstone	pearl
July	ruby, onyx	ruby	ruby	ruby
August	sardonyx, sapphire	peridot	diamond	sapphire
September	sapphire, peridot	sapphire	agate	moonstone
October	tourmaline, aquamarine	opal, tourmaline	jasper	opal
November	citrine, topaz	topaz, citrine	pearl	topaz
December	zircon, ruby	turquoise, blue topaz	onyx	ruby

from wikipedia http://en.wikipedia.org/wiki/Birthstone

Aquamarine is my favorite gem, and blue topaz is also a March stone (my month), or so it is in several lists, but it doesn't matter. It really doesn't, because the more you know about gemstones, the more you will love all of them.


As an example, let's dream and learn about:

Aquamarines

http://www.ratnasagarjewels.com/Aquamarine-loose-Gemstone-wholesale-Jewelry.html
Aquamarine Gemstone- Heart Briolettes

View Large Image

Item Code AQU4 Quality Length Gemstone Origin AAA 20cm. BRAZIL Brief details NATURAL ,SKY BLUE COLOR IN MICRO CHEKKER FLOWER CUT NOW! Size(mm.) Weight(Cts.) Price/Cts. Price/Strand Qty 5 to 6 45 $1.15 $51.75 BUY 7 to 8 60 $1.15 $69.00 BUY

Aren't these lovely looking? These strands would make beautiful necklaces!!! And these websites also offer to send you other precious stones, too. Aquamarines happen to be my weakness, being the stone for my birthday month of March, but aquamarines are also the stones for those celebrating their 18th wedding anniversaries.

There are many websites that offer general information on aquamarines, such as,

http://www.beads-manufacturers.com/aquamarine-beads.html

Aquamarine Beads

Aquamarine Beads

Aquamarine actually belong to the gemstone family of Beryl. This stone is often mistaken with emerald. The high-quality aquamarine is generally free of inclusions and possesses a superior brilliance. The value of this gem depends on the intensity of the color as the more intense the color of this stone, the higher its value. They are basically hard gemstones, thus, perfect for jewelery making. It's name was derived from the Latin words of "mare" (sea) & "aqua" (water). It is highly lucky for sailors.

Color
Since, aquamarine stones are soft gems, the color adds an extra quality to it, thus, making them extra soft:

• Shades of green (sea green)
• Shades of blue (sky blue)

Shape
Aquamarine beads can be found in a wide array of shapes:

• Rough Opaque nuggets
• Delicate faceted briolettes

Significance
Aquamarine Gemstone Beads have a versatile role to play when it comes to enhancing one's personality:

Brings courage and fortitude · Quick intellectual responses Spreads peace, harmony

Strengthens the bond of friendship Calming communication Excellent therapeutic tool

Material
Aquamarine beads can be gelled well with the following materials for production purposes. Such as jewelery, artifacts etc.

Gold White Gold Sterling Silver Stainless Steel Titanium

Rhodium Shell Copper Enamel Cloth & Nylon

Usage
The aquamarine beads are highly in demand when it comes to jewelry making:

Rings Earrings Pendants Bracelets Loose Gems

Body Jewelry Necklaces Jewelry Sets Charms Diamond Jewelry Anklets

Manufacturing Hubs
Aquamarine stones are found in :

Brazil India Russia Mozambique

Madagascar Afghanistan Pakistan

And where you can buy precious gemstones in chunks:

http://www.metastones.com/aquamarine_mineral_specimens.html

This gemmy aquamarine is made up of three complete crystals that have forged together in an attractive cluster. The piece is self standing, boasts a lovely clarity and sky blue color as well as great terminations.

Size: ¾ x 5/8 x ½ inches
Price: $120.00 (plus shipping and handling)


http://www.healwithgemstones.com/heal_with_aquamarine.htm


Aquamarine

Healing Powers-

Magical properties-

Aquamarine symbolizes peace. It encourages a gentle nature and personality in the wearer.

Chakra Classification-

Aquamarine is generally associated with the Throat Chakra

Star Signs -

For Aquarius, Aquamarine promotes friendship and love. For Pisces it encourages awareness. Libras are warned against danger.

Some say that gemstones heal. It is well-described on many websites that they have "chakras" or healing properties. I suppose it makes them more mysterious if they might have magical properties. That extends beyond my purview, to be sure. I just think they look gorgeous!!! They would make fabulous gifts. Buying them online from trusted sites and sources saves money, too.

Some websites offer custom designs if you choose the gemstones, such as

http://dodidesigns.com/

On the internet one can learn a lot more about many properties of gemstones. Looking at photos to really see many different views to tell them apart helps the amateur a lot. To converse knowledgeably about gemstones, whether visiting a jewelry store or at dinner with family and friends, it is now easy to learn about them with photos and descriptions on the internet.

This list is incomplete and just a small example of the many thousands of worthy websites devoted to the world of precious stones, a new interest of mine. I do not claim to have listed the best websites. These examples simply illustrate that some are for your research and education, and some are for buying as well, from all around the world, thanks to the internet.

Like paintings, you should really buy ones you love to look at, rather than for investment purposes. They don't always go up in value and can get lost or stolen. Investing money in the stock market and other financial instruments is generally the best way for investment appreciation, I believe, even in this era of uncertain values of real estate and so on. But gemstones create beautiful and enjoyable family treasure to see and feel. They are tangible assets to remember you by if you pass them along to future generations. They are precious gifts to give to friends and family, and a joy to give to yourself to own.

SAT optional?

To continue on the theme of testing from my recent post about general test ranking results in America, there is an article today about the value of the college prep tests, SATs, in The New York Times questioning them from various angles. Looks like not many colleges and universities are going to go SAT-optional in the near future. A few, of course, already are.

There is clearly a change in attitude to SATs and a certain skepticism that is new. SATs are supposed to predict "success" at institutions. Many studies show that learning to do them well indicates just that - you have learned how to take them. (And if your socio-economic educational background is very affluent, then you are likely to have a higher score.)

There are certainly questions admissions officers must learn to look at: what is nature of the student's character as a whole? In what circumstances was the student able to study for the admission test? Was the quality of the test prep material adequate to prepare for the test appropriately? Was the test administered properly, timed well and with proper materials? Does it suit the nature of the student's proposed and current studies? Can other measures be considered to better advantage than the standard test, such as student grades going back and extra-curriculars?

Looks like SATs will be around in the forseeable future unless all the colleges decide at once not to require them. I think they are likely to be more mandatory as the number of undergraduate international students increases to measure their likelihood of successful study in America.

Excerpts from today's article, "Study of Standardized Admissions Tests Is Big Draw at College Conference", by Sara Rimer:


Mr. Fitzsimmons, the dean of admissions at Harvard, led a commission of college admissions officials who drafted the study, which challenges colleges and universities to examine their use of the SAT and ACT and to consider whether the benefits outweigh the disadvantages or whether they can make the tests optional for admissions.

...Mr. Fitzsimmons, who took center stage along with the other members of the commission, tried to ease the fears of the ardent supporters of the standardized admissions tests, taking pains to say that the SAT had many advantages.

...But he also affirmed what many of those present had been saying for years: that the SAT and other standardized admissions tests are “incredibly imprecise” when it comes to measuring academic ability and how well students will perform in college. He said colleges and universities needed to do much more research into how well the tests predict success at their individual institutions.

There has been longstanding debate and concern about the impact of standardized testing on socioeconomically disadvantaged students, and the ballroom erupted in applause when Mr. Fitzsimmons called for an end to the use of “cut scores” to determine who qualifies for National Merit and other scholarships. The practice means that one student is rewarded while excluding another whose SAT score may be only a single point lower, Mr. Fitzsimmons said.

What that single point differential fails to take into account, he said, is the context: The two students may have “lived entirely different lives, had entirely different educational opportunities and entirely different access to test prep.”

The audience also applauded Mr. Fitzsimmons’s call for U.S. News & World Report to stop using SAT scores as part of its college rankings.

...Jeffrey Brenzel, the dean of admissions at Yale, said the report raised key questions for every college and university: “Are you using the tests in a responsible manner and in the way they were intended? Is your use of the test relevant to your particular institution’s mission? Are there alternatives?”

...An audience member asked Mr. Fitzsimmons and the other college admissions officials on stage if any of them had changed their minds about the SAT and decided to go test-optional as a result of their participation in the study...

One by one, the other admissions officers gave variations of the same answer: We’re concerned about the inequities and possible misuses of the test. We’re going to keep studying it and talking about it, but the tests are useful for us, and we’re not going test-optional.*

The New York Times

Oct 1, 2008

Manhattan real estate market cools

After seven years of nonstop construction, skyrocketing...sales prices, ... the credit crisis and the turmoil on Wall Street are bringing New York’s real estate boom to an end.

...Developers are complaining that lenders are now refusing to finance projects that were all but certain months or even weeks ago.

...Examples of aborted deals and troubled developments abound. Last Friday, HSBC, the big Hong Kong-based bank, quietly tore up an agreement to move its American headquarters to 7 World Trade Center after bids for its existing home at 452 Fifth Avenue, between 39th and 40th Streets, came in 30 percent lower than the $600 million it wanted for the property.

...Barry M. Gosin, chief executive of Newmark Knight Frank, a national real estate firm based in New York, said: “Today, the entire financial system needs a lubricant. It’s kind of like driving your car after running out of oil and the engine seizes up. If there’s no liquidity and no financing, everything seizes up.”

...“Any continued impediment to the credit markets is awful for the national economy, but it’s more awful for New York,” said Richard Lefrak, patriarch of a fourth-generation real estate family that owns office buildings and apartment houses in New York and New Jersey.

“This is the company town for money,” he said. “If there’s no liquidity in the system, it exacerbates the problems. It’s going to have a serious effect on the local economy and real estate values.”*

The New York Times

Oct 1, 2008

My question: Does it get worse before it gets better?