Source: http://feedproxy.google.com/~r/bmjvodcast/~3/AmoGUwcvZlA/profile2.html
Wednesday, July 11, 2012
Health Care Reform
Washington's abuzz about health care, but why isn't a single-payer plan an option on the table? Public Citizen's Dr. Sidney Wolfe and Physicians for a National Health Program's Dr. David Himmelstein on the political and logistical feasibility of health care reform.
Bill T. Jones, Part 1
At the close of Lincoln's bicentennial year, Bill Moyers Journal takes a unique look at the 16th President. Moyers speaks with critically acclaimed choreographer Bill T. Jones about his creative process, his insights into Lincoln, and how dance can give us fresh perspective on America's most-studied president.
Source: http://feedproxy.google.com/~r/bmjvodcast/~3/x4FdOCNptIY/profile.html
Taking Away Directors’ Rubber Stamps
Underworked, overpaid corporate boards are harming the shareholders of public companies, writes John Gillespie and David Zweig in “Money for Nothing.”
Source: http://www.nytimes.com/2010/01/17/business/17shelf.html?partner=rssnyt&emc=rss
Bill T. Jones, Part 2
At the close of Lincoln's bicentennial year, Bill Moyers Journal takes a unique look at the 16th President. Moyers speaks with critically acclaimed choreographer Bill T. Jones about his creative process, his insights into Lincoln, and how dance can give us fresh perspective on America's most-studied president.
Source: http://feedproxy.google.com/~r/bmjvodcast/~3/CWaAulregMQ/watch2.html
Carl Richards on Performance Chasing
A couple of posts ago, I asked why everyone isn’t beating the market when there are a dozen or more strategies that promise long-term outperformance. I argued that the problem wasn’t so much that the strategies themselves were flawed: the more important issue is that investors tend to quickly lose patience when their strategy isn’t [...]
European Court Upholds Most of $1 Billion-Plus Microsoft Fine
Filed under: Company News, Technology, Google , Microsoft, Apple, Market News
By TOBY STERLINGBRUSSELS -- A European court on Wednesday upheld most of a massive fine levied against Microsoft (MSFT) by the European Commission's competition watchdog, closing a case against the software giant that began in 1998.
In an appeals ruling, the General Court of the European Union rejected Microsoft Corp.'s request to dismiss the fine levied in 2008, but did trim it by 39 million euros ($49 million) to 860 million euros ($1.1 billion). Counting two earlier fines, the case has wound up costing Microsoft a grand total of 1.64 billion euros ($2.05 billion).
That's the most ever resulting from a single antitrust case in Europe, though in 2009, Intel (INTC) was hit with the largest single fine, 1.09 billion euros ($1.36 billion).
The court in Luxembourg said its decision "essentially upholds the Commission's decision and rejects all the arguments put forward by Microsoft in support of annulment."
The 860 million euro fine is a "penalty for noncompliance" with the watchdog's 2004 order for Microsoft to make computer programming code available that would allow competitors' products to interface properly with Microsoft's server software.
Microsoft did so, but at a price the Commission said was so exorbitant it amounted to not complying.
The court upheld that finding, but said Microsoft deserved a small break because of a letter the Commission sent in 2005 saying the company didn't have to freely distribute code that wasn't its own and was freely available elsewhere. That letter gave Microsoft some room to think it was OK to continue acting the way it had until 2004, and should have been "taken into account in determining the gravity of the conduct found to be unlawful," the written decision said.
The Commission's top regulator Joaquin Almunia said the judgment "fully vindicates" his office's action against Microsoft and "brought significant benefits to users."
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"A range of innovative products that would otherwise not have seen the light of day were introduced on the market," thanks to the Commission, he said.Microsoft was less enthusiastic.
"Although the General Court slightly reduced the fine, we are disappointed with the Court's ruling," the company said in a statement.
Microsoft was initially fined 497 euros along with the 2004 order, then it was penalized another 280.5 million euros for noncompliance in 2006, and then another 899 million euros in 2008.
The company has already booked provisions for all the fines and penalties and after the ruling it has no active outstanding quarrels with European regulators.
"In 2009 Microsoft entered into a broad understanding with the Commission that resolved its competition law concerns," the company said.
Most notably in the 2009 deal, Microsoft ended an investigation into allegedly abusive practices for bundling its Internet Explorer web browser along with its operating systems. Microsoft agreed to instead offer customers a range of browsers to choose from.
In a sign of the times, Microsoft itself turned to the watchdog in 2012, asking it to investigate Google for anti-competitive practices. Microsoft alleged that Google (GOOG) was demanding unreasonable fees to license its technologies and asking courts to pull Microsoft products from shelves if they don't pay up. Google shot back with a similar request for the Commission to again investigate Microsoft last month.
Many observers say companies such as Apple (AAPL), Google and Microsoft are increasingly acting as "patent trolls," using the legal and regulatory systems as tools to thwart competitors as part of their wider struggle for market share.
Almunia said in February "the Commission will continue to keep a close eye on the behavior of all market players in the sector, particularly the increasingly strategic use of patents."
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Source: http://www.dailyfinance.com/2012/06/27/european-court-upholds-most-of-1-billion-plus-microsoft-fine/
News Analysis for the Investor on July 10, 2012
PFGBest Customer Funds Missing $200 Million
Less than a year after the collapse of MF Global, the brokerage industry is reeling anew from revelations that more than $200 million in customer funds is missing from the accounts of futures broker PFGBest, and that its founder attempted suicide outside the company’s Iowa headquarters, Reuters reports. PFGBest clients will be allowed to liquidate open trading positions, but not to withdraw funds or make new trades until further notice. The National Futures Association (NFA), an industry regulatory group issued an emergency order to effectively freeze PFGBest's operations after finding that a U.S. bank account the broker said contained $225 million in customer funds actually held only $5 million. Owner Russell Wasendorf Sr., a 40-year futures markets veteran, was found in his car, and is in critical condition at the University of Iowa Hospitals, according to local news reports.
UK Judge: Samsung Can Sell Its “Not as Cool” Tablets in the UK
There was good news and bad news for Samsung. The company on Monday prevailed in a London court over Apple’s legal move to block the sale of its tablet computers in the UK. Apple had claimed three models of the Galaxy Tab too closely resembled the design of the iPad. But Judge Colin Birss ruled that the company’s Galaxy Tabs were “not as cool” as Apple’s iPads and that here were noticeable differences between the tablets in terms of their thickness and the designs on the back, the Financial Times reported. Apple has been waging a global patent battle since 2010 against companies such as Samsung which produce rival tablet computers and mobile phones using Google’s Android operating system. Such devices are the biggest commercial threat to Apple, and rivals have accused the US company of using its patents aggressively to disrupt their sales, FT reports. Last month, an appeal coirt lifted the ban on Samsung Galaxy phone sales in the U.S., But it upheld a block on sales of Samsung’s tablets. A full court trial is scheduled for the end of July.
Chinese Firm to Buy Hawker Beechcraft
Hawker Beechcraft announced Monday that a pending deal with a Chinese aerospace manufacturer will save thousands of domestic jobs in Kansas and Arkansas. The struggling aircraft maker said it had reached a $1.79 billion "exclusivity agreement" for the sale of its business jet and general aviation operations with Beijing-based aerospace manufacturer Superior Aviation Beijing Co., Ltd., which will make payments over the next six weeks to support ongoing operations until the deal is finalized. The sale does not include Hawker Beechcraft Defense Co., which will remain a separate entity, the Associated Press reports. The company employs about 7,400 people, with roughly 4,700 working at its Wichita, Kan., facility. It also has factories in Little Rock, Ark., the U.K. and Mexico, as well as more than 100 service centers worldwide.
Bailout Negotiated for Spain’s Banks
More than $36 billion could be channeled to Spain’s struggling banks by the end of this month, according to the terms of a tentative bailout agreement reached early today among Euro area finance ministers, The New York Times reports. The agreement is scheduled for a final vote on July 20. The agreement would also provide a one-year extension to a deadline for reducing Spain’s budget deficit, according to The Times.
CFPB Proposes More Transparent Mortgage Documents
The Consumer Financial Protection Bureau has proposed rules to increase clarity and fairness in mortgage lending, The New York Times reports. The rules, released yesterday, are designed to provide consumers a simple declaration of payments and fees associated with their loans.
Among other provisions, the rules would require lenders to issue an estimate of interest paid over the life of the loan. The statement, due within three days of receiving a mortgage application, must inform consumers of the risks posed by negative amortization loans and other types of risky mortgages, according to The Times. Consumers would also be informed of any potential fees, such as prepayment penalties.
Rocky, but Uphill Road for Markets
Analysts predict the stock market will realize a double digit gain this year, but expect the second half to be rougher than the first, CNNMoney reports, citing its survey of 30 investment strategists and money managers. The group predicts the S&P 500 index will gain 4 percent over the next six months to finish at 1,400, according to CNNMoney. In comparison, the index gained 8 percent in the first two quarters of 2012. Economic and political uncertainty at home, and weakening economies in Europe will continue to undermine investor confidence, leading to market volatility over the next six months.
Source: http://www.millionairecorner.com/article/news-analysis-investor-july-10-2012
Rise in Offshore Spills Raises Wider Questions on Drilling
The catastrophe unfolding in the Gulf of Mexico has been portrayed as a one-of-a-kind disaster, a perfect storm of bad equipment, bad planning and bad luck.
But it’s far from the only spill that’s taken place this year – or even the only spill occurring in the Gulf right now.
On June 7, the Mobile Press-Register reported that the Ocean Saratoga rig has been leaking into the Gulf since April 30. Interior Department spokeswoman Kendra Barkoff confirmed the next day that “small amounts of oil” were leaking from the wells beneath the rig, about 10 miles from Louisiana’s southeastern coast.
Taylor Energy, the well’s owner, said in a statement that it was engaged in an “ongoing well intervention plan” with the government to fix damage caused by Hurricane Ivan in 2004, and that no significant new spill had occurred.
The Deepwater Horizon isn’t the only recent spill for BP, either. On May 25, according to Reuters, an accident on the Trans-Alaska pipeline spilled thousands of barrels of oil and forced the pipeline to be shut down for more than three days. BP is the largest owner of the pipeline operator, controlling 47 percent. (Read our story about BP’s troubled history in Alaska and its other U.S. operations.)
In addition, there was the Jan. 24 spill in Port Arthur, Texas, when an Exxon-Mobil tanker collided with an outgoing vessel and dumped nearly half a million gallons of oil into the Gulf.
If it seems as if oil spills – and particularly offshore spills in US. waters – are on the rise, that’s because they are.
A USA Today analysis of federal data found that spills from offshore oil rigs and pipelines have more than quadrupled in the last decade. From the 1970s to 1990s, offshore facilities averaged four spills per year of more than 50 barrels. From 2000 to 2009, the annual average soared to 17.
The report also found that the rate of oil being spilled was increasing faster than the growth in production. From USA Today:
In the 1980s, an average of about 2,900 barrels of oil and other toxic chemicals spilled a year. That figure rose to more than 4,400 in the 1990s and to more than 6,100 in the 2000s. Offshore oil production increased during that time, but the rate of barrels spilled per barrels produced continued to increase.
The company with the most spills in the last decade was BP, which had reported 23 spills of over 50 barrels without counting the Deepwater Horizon blowout.
Why are offshore oil facilities spilling more in recent years than they have in the past?
One possibility is that regulators haven’t been able to keep up with the surge in offshore drilling. The Washington Post reported Thursday morning that the Minerals Management Service has only seven more inspectors now that it did in 1985, even as offshore drilling projects have skyrocketed. From the Post:
Although the number of exploration rigs soared and the number of deep-water oil-producing projects grew more than tenfold from 1988 to 2008, the number of federal inspectors working for the Minerals Management Service has increased only 13 percent since 1985.
A message left for MMS this morning has not been returned.
Stefan Mrozewski, a drilling engineer with Columbia University’s Borehole Research Group and a former oil industry employee who once worked on the Deepwater Horizon, said the increase may in fact be driven by a very different dynamic – better voluntary reporting of spills by the industry.
Oil companies and service companies in the Gulf of Mexico “have – at least over the past 10 years – been extremely conscientious about report [sic] spills, incidents, hazards, etc,” wrote Mrozewski in an e-mail. “I would venture that the same attitude did not prevail in the 90s, and certainly not in the 70s.”
David Miller of the American Petroleum Institute, a trade association for the oil and gas industry, said that offshore drilling was heavily regulated by the government, citing the MMS’s extensive guidelines for deepwater drilling.
“There’s quite a few regulations that the industry has to follow to be in compliance with the MMS,” said Miller.
Another possibility is that oil is simply harder to reach now – that increased consumption has led companies to turn to deeper waters and riskier procedures to satisfy the ever-expanding demand for energy.
“While the point of “peak oil” may or may not have been reached, what Michael Klare, a professor at Hampshire College, has dubbed the Age of Tough Oil has clearly begun,” wrote the New Yorker’s Elizabeth Kolbert on May 31.
Source: http://feeds.propublica.org/~r/propublica/energy-environment/~3/A6XyTCX78yQ/
John Lithgow, Part I
He's played heroes, villains, saints, sinners, a ballet-dancing elephant, and a space alien, now actor and children's author John Lithgow - best known as Dick Solomon from NBC's hit show 3rd Rock from the Sun - reveals a new side of himself... poetry lover. The award-winning stage and screen star Lithgow shares his favorite poems, insights into acting, and thoughts on the enduring power of art. Lithgow currently stars in the Broadway revival of Arthur Miller's All My Sons. He has penned several children's books, as well as compiled poems for The Poets' Corner: The One-And-Only Poetry Book for the Whole Family.
Source: http://feedproxy.google.com/~r/bmjvodcast/~3/-Mbdt1SCvTM/profile.html
Taxes and Trust: Obama's Achilles Heels
Pat Caddell, Breitbart
The Supreme Court's Obamacare-affirming decision--which can be summed up as "Read John Roberts' lips, it's a tax" --has put a political cudgel in the hands of Republicans. Â The cudgel, of course, is taxes. Â But a huge nail is also embedded in the cudgel: the fundamental deceit of Obamacare. Â Yet in the week since the Court's decision, Republicans have yet to demonstrate that they truly grasp the significance of this weapon--or that they can effectively wield it. Â Why? Â Some Republicans are worried that the fight over Obamacare distracts from the issue of the...
The Supreme Court's Obamacare-affirming decision--which can be summed up as "Read John Roberts' lips, it's a tax" --has put a political cudgel in the hands of Republicans. Â The cudgel, of course, is taxes. Â But a huge nail is also embedded in the cudgel: the fundamental deceit of Obamacare. Â Yet in the week since the Court's decision, Republicans have yet to demonstrate that they truly grasp the significance of this weapon--or that they can effectively wield it. Â Why? Â Some Republicans are worried that the fight over Obamacare distracts from the issue of the...
Source: http://www.realclearpolitics.com/2012/07/10/taxes_and_trust_obama039s_achilles_heels_284358.html
Tuesday, July 10, 2012
A Few Basic Tax Terms That 'The Man' Doesn't Want You to Understand
Filed under: Taxes
Is the American tax code designed to be confusing?Looking at the thing, it's hard to escape that conclusion. To begin with, there's its size: The full code is over 70,000 pages long -- 22 times as long as Remembrance of Things Past, 62 times as long as the King James Bible, and 54 times as long as the complete works of William Shakespeare. Or, to put it another way, it's about 175 times as long as its first edition, which was published in 1913.
Contained within its 3.7 million words are thousands of exemptions, definitions, deductions and loopholes, and teasing them out requires an estimated 7.6 billion hours of tax preparation per year. That's more than 24 hours for every man, woman and child in the country. Even the head of the IRS hires an accountant to do his taxes.
Given all that, it's hard to dismiss the notion that the tax code is deliberately designed to confuse the average taxpayer: Its byzantine structure supports an army of accountants and attorneys, computer programmers and bean counters who rake in an estimated $27.7 billion per year helping us prepare our taxes.
But the tax prep industry isn't the only group that benefits. Arguments about cuts and deductions, minimums and premiums have fueled many a political campaign. And whether you're inclined to raise tax rates or lower them, increase incentives or decrease exemptions, chances are that you've been tripped up at least once or twice by a confusing term -- or a slick politician wielding it. With that in mind, we decided to unpack a few of the most weaselly of the IRS's weasel words -- and look at how they may affect your yearly taxpaying ritual.
Income vs. Taxable Income
One of the most slippery tax phrases is income. Taken at face value, its definition seems obvious -- clearly, "income" is supposed to refer to the amount of money that a worker brings home in a year. But in the hands of the tax industry, even this clearest of words becomes cloudy. Recently, The New York Times highlighted this with its tale of the ridiculous tax rate paid by James Ross (right). The founder of an investment firm, Ross paid 102% of his 2010 income to the taxman.The tale was tailor-made for tax critics: Ross -- a job-creator, a graduate of Yale and Columbia, and a one-man economic powerhouse -- was clearly being charged a cruel and unusual tax rate. How could the government possibly rob such an upstanding citizen like that? Where do we live, Sweden? By God, Ross had to withdraw money from his savings account to cover his taxes!
Of course, there was more to the story. Ross didn't actually pay 102% of his income, but rather 102% of his taxable income -- the money left over after he subtracted out his mortgage interest, state taxes, and all the other clever deductions and exemptions he was allowed to take from his total income. In fact, Ross actually paid only 20% of his real earnings in 2011 -- about 4 percentage points less than the average tax paid by someone at his level. Thanks to his impressive list of deductions and business-related expenses, he actually scored a nice tax cut, rather than the brutal burn that the Times story would at first seem to suggest.
Income should be an straightforward, clear term, but it's often muddied for political purposes. Total income -- the amount of money that one makes in a year -- can be hard to quantify, so pundits and politicians tend to focus on more easily-defined terms. For example, depending on a politician's leanings, he or she may consistently discuss earned income (all the taxable wages and tips that one gets from a job), adjusted gross income (earned income, minus personal exemptions), or taxable income (earned income, minus all exemptions and all deductions). Because wealthy people often have more deductions and exemptions than lower-level earners, changing which term you use can radically alter how you frame any tax debate -- not to mention the degree to which the rich seem to be unfairly targeted by the tax code.
Dividends: Qualified to Cause Trouble
By all rights, a dividend should be easy to understand: It's money that a company pays out to its stockholders, and for most of the modern era, it was generally taxed at the same rate as any other income. Beginning in 2003, however, special tax breaks for stockholders muddied the waters, turning a relatively simple idea into a complicated -- and controversial -- tax nightmare.
Nowadays, there are two basic classes of dividends -- "ordinary" and "qualified." Ordinary dividends, which come from stocks that have been held for a short period of time, are taxed at the same rate as ordinary income. "Qualified" dividends, on the other hand, come from stocks that have been held for longer periods, and are taxed at a much lower rate.
The differences between the rates are major. People who earn up to $33,950 per year pay a basic tax rate of 10% to 15%. But people who make that money from qualified tax dividends don't pay any tax on it at all. Meanwhile, those who earn more than $33,951 per year pay between 25% and 35% on their taxes, but those who get that money from qualified dividends pay only 15%. This, by the way, explains how tycoons like Mitt Romney and Warren Buffett reach overall tax rates of 15% or lower, while people who make $34,000 per year pay a base rate of 25%.
While the qualified dividend tax rate is attractive, it is also confusing: The IRS' rulebook states that qualified dividends must come from stocks that the owner has held "for more than 60 days during the 121-day period that begins 60 days before the ex-dividend date." But there's also qualified preferred stock, which must have been held "more than 90 days during the 181-day period that begins 90 days before the ex-dividend date if the dividends are due to periods totaling more than 366 days."
Interest Gets Too Interesting
As if dividends weren't confusing enough, some things classed as "dividends" are actually misnamed -- and are taxed as regular income. For example, the "dividends" that you get from your credit union or savings and loan bank are actually classed as interest. This money counts as regular income, and is taxed as such.
(Of course, interest income isn't a huge problem these days. As long as the Federal Reserve keeps its interest rate at or near zero, most financial institutions aren't going pay much interest to their customers. This, incidentally, is part of why banks have been piling on fees and charges over the last few years. But that's another story.)
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Interest itself is another tax oddity. For example, in the current election cycle, something called "carried interest" has come under scrutiny. Essentially, it's a payment method used by many hedge funds and investment firms that pays fund managers and execs out of the proceeds of the funds they manage. By linking paychecks directly to investment income instead of salary, carried interest enables these high-earners to pay a 15% tax rate instead of the 35% that wage earners pay. President Obama's 2013 tax proposal suggests that Congress close the carried interest loophole. But even regular interest can be confusing. The interest that one gets from a standard bank account, CD or money market account is taxed at the same rate as regular income, but interest from a savings bond doesn't count until the bond matures or until you redeem it. And, if you use your savings bond interest to pay for some of your college expenses, you may be able to avoid paying taxes on it.
If you own U.S. Treasury bills, notes or bonds, the interest that you get from them is subject to federal tax, but not to state tax. On the other hand, interest on bonds that are issued by states may be exempt from federal tax! For that matter, some of the interest you pay -- specifically the interest on your mortgage and your student loans -- may be deductible.
Bruce Watson is a senior features writer for DailyFinance. You can reach him by e-mail at bruce.watson@teamaol.com, or follow him on Twitter at @bruce1971.
Does It Matter That a German Exchange May Control the NYSE?
Filed under: Investing, Investing Basics, NYSE, Market News, Investment
Capitalism has many ways of dealing with failure. If a company is small enough to fail without bringing down an entire industry or economy, it files for bankruptcy. If such a failure seems to threaten wider economic stability, the company gets a government bailout. And if it fails moderately but still has some assets with value, it gets acquired.
This last form of failure comes to mind in the case of NYSE Euronext (NYX). In 2005, it handled 80% of all trading in the stocks it listed. Today, that share is down to 23%, according to Bloomberg. New competitors have hacked away at its market share by offering superior service at a lower price.
And, as I reported in a DailyFinance article in June, the NYSE has been trying to offset some of the lost revenues by selling high-speed access to the NYSE's computers so hedge funds can trade a fraction of a second ahead of regular customers -- a practice that skims $3 billion out of investors' pockets each year. Now, Germany's 18-year-old Deutsche Boerse (DBOEY) wants to buy 60% of the combined companies for $10 billion in stock.
Considering that the NYSE is a storied American institution -- founded back in 1792 by traders standing beneath a buttonwood tree -- it's not unreasonable to ask whether the U.S. should allow a German company to control it. But the reality is that the luster of NYSE's name and history is far greater than its competitive position today. If Germany ever decided to close down the NYSE, nimbler U.S. exchanges would jump in immediately, eager to pick up the slack.
Computerized Competitors: Faster, Better, Cheaper
Investors don't decide where to trade based on an exchange's address: They want fast, inexpensive trade execution. And thanks to regulatory changes regarding what exchanges can charge, and an evolution of the industry structure that made room for new, computerized exchanges, that's what they get. A decade ago, it cost 6.25 cents to execute a 100-share trade. Today that cost is down to a penny.
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And unlike the NYSE, which still has a few costly specialists whose job is to match up buyers and sellers for a specific stock, the 50 computerized exchanges -- up from 20 in 2000 -- don't. So exchanges such as Getco, Bats Global Markets and Direct Edge can make money -- with margins as high as 55% for trading derivatives -- while offering low prices and fast execution, reports Bloomberg.The NYSE has been going downhill for at least 40 years. The competition really got going in 1971 when the Nasdaq was formed to provide computerized trading and price quotes. In 1984, I consulted to the NYSE -- analyzing the competition it faced in the then-lucrative business of selling those price quotes. The business of charging for such quotes has essentially gone away.
Two scandals -- a 2003 flap over then-CEO Dick Grasso's $140 million compensation package and 2005's revelation that 15 NYSE specialists had manipulated prices to steal $19 million from clients -- tarnished the NYSE's remaining luster. In 2006, a reverse merger with Archipelago Holdings took the member-owned NYSE public.
A Decade of Merging for Leverage
If the Deutsche Boerse-NYSE Euronext merger goes through, it will be one among many similar marriages that have taken place over the last few years -- $95.8 billion worth since 2000, reports Bloomberg. The reason is simple: Once you build a computer system that can execute trades, the more trading volume you pump through the system, the higher your profits. This is bad news for people who work in the exchanges in jobs like sales, marketing and computer support. But it's better news for shareholders because mergers reduce costs.
If the two exchanges combine, they'll dominate the futures market. The Futures Industry Association estimates that the merged exchanges would be the top-ranked global futures trader, controlling 11 derivatives markets in the U.S. and Europe with 4.8 billion in contracts (based on last year's numbers). That's 55% more than 2010's futures leader, CME Group (CME).
For all the patriotic chest-thumping that might ensue over the idea of letting a German company control the NYSE, the truth is that the NYSE has been falling behind for decades. This merger is a way to rescue a failed company while it still has some salvage value.
As long as the U.S. can keep innovating in the creation of computerized exchanges, the price and speed of execution that investors want will keep improving -- and trading market share will shift to those innovators.
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Source: http://www.dailyfinance.com/2011/02/10/nyse-deutsche-boerse-merger-stock-exchange-germany/
Friday Links
The Financial Post shared some new statistics that shows why Fewer Canadian Employers Planning to Hire. Now that half of the year is over, it’s time to analyze your numbers. Gail Vaz-Oxlade wants to make sure you know What’s Your Net Worth? This week Million Dollar Journey posted an interesting article on The Benefits of...
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Trudy Lieberman and Dr. Marcia Angell
Bill Moyers sits down with Trudy Lieberman, director of the health and medical reporting program at the CUNY Graduate School of Journalism, and Marcia Angell, senior lecturer in social medicine at Harvard Medical School and former editor in chief of the New England Journal of Medicine.
Source: http://feedproxy.google.com/~r/bmjvodcast/~3/Wk9eGhGbarg/profile.html
What is iShares Planning After Acquiring Claymore
Recently, I had a chance to chat with Mary Anne Wiley, head of BlackRock Canada on what the 800 pound Gorilla in the ETF marketplace plans to do after the blockbuster acquisition of the #2 player Claymore Investments was recently finalized. After the acquisition closed, iShares rebranded all Claymore products (ticker symbols remained the same) [...]
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Bill Moyers on Studs Terkel and John Leonard.
A Bill Moyers essay on the loss of Studs Terkel and John Leonard.
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Trojans, Explosions, Power Failures and Random Thoughts
Looks like another fun virus is out there and may do damage to your computer. The first one screws around with your DNS so check it out DNSChanger Malware Site, the second one looks like a threat from CSIS, which isn’t to be believed either. Always keep your virus software up to date, and run [...]
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Bringing Annuities into 401k's
In the past, traditional pensions offered Americans guaranteed income throughout their retirement. Unfortunately, in more recent years, that guarantee has waned drastically. Instead, the average retirement plan must focus on investment accounts that you must manage on your own.
But is there good news on the horizon? Might we soon see a shift back to the old ways?
If regulations recently proposed by the federal government are any indication, the answer might very well be yes. These regulations, if accepted, would simplify the way in which annuities and other types of steady income can be added to existing 401k plans and IRAs. When you look at the current state of retirement and what these changes could mean to many retirees, it isn't difficult to see why the government is taking these steps.
Current Retirement Plans are Insufficient
One of the biggest issues facing retirees is trying to save enough money to live on throughout their retirement. With the average lifespan at an all-time high, citizens need to plan for more years of life than their ancestors ever did. Even an extra ten years of retirement planning can put quite a strain on a person's financial portfolio.
Many women are in an even worse spot. The average lifespan of a woman is higher than a man's, which means they will need to save for more years than their male counterparts. If that wasn't bad enough, women often have considerably lower retirement savings because they often spend less time earning full-time wages than men. This is often due to family and home obligations, which means women have often sacrificed their own well-being for the betterment of their loved ones.
New Proposals Tackle Longevity Risk
Many retirees are unsure how to plan for their future, because it's impossible to know how long they may live. The average lifespan of a man is 84, whereas it's 86 for a woman. Reaching these ages is becoming increasingly common. It isn't unusual for at least one spouse to live into his or her 90's. Even though you may have a nice chunk of money squirreled away in your retirement accounts, it's difficult for a person to know how much he or she should spend each year in order to make the savings last. This is especially true if they are in good health and may very well surpass the average lifespan. Many retirees in this situation believe they should only withdraw four percent of their savings each year, but some are unsure if that will be enough when added to Social Security.
Predictable Income
The best way to combat the above issues is to help retirees gain a stable income that they can count on. One way to do this is to utilize an annuity that is offered in conjunction with a 401k or IRA plan. This will allow retirement accounts to be pooled together, which means that the normal four percent withdrawal rate mentioned above will switch to something more along the lines of six or seven percent, determined by the type of annuity and the interest rate. The suggested regulations would make attaining this increased, steady income much easier.
Longevity Insurance
This is another option that the federal government is trying to improve. Depending on the insurance offered, the income doesn't begin until you're much older, like into your 80's. It is designed to assist people with a steady income past the point of the average lifespan. 401k plans and IRAs cannot offer this type of longevity due to their required minimum distribution rules.
Source: http://firstsecurityfinancialshow.com/blog/bid/151325/Bringing-Annuities-into-401k-s
British Columbia Invests in Solar Power
The Government of Canada is advancing the development of clean technologies through a $20,000 investment to harness solar power for the Osoyoos Desert Centre in British Columbia. The funding will help the Osoyoos Desert Society to purchase and install solar equipment designed to provide the Osoyoos Desert Centre with a source of year-round power. The [...]
Source: http://www.alternative-energy-news.info/press/bc-solar-power/
Shahan Mufti and Juan Cole
As the world follows the violence and unrest in Pakistan, Bill Moyers speaks with historian Juan Cole and journalist Shahan Mufti about the U.S. relationship with Pakistan, how it relates to the war in Afghanistan, and why they think Pakistan is not likely to become a failed state anytime soon.
Source: http://feedproxy.google.com/~r/bmjvodcast/~3/vKOH0UQm6go/profile.html
Offshore U.S. oversight of derivatives may bolster defenses against JPMorgan-type losses
The CDS indices involved in the JPMorgan trades are already encompassed under CFTC’s anti-fraud and anti-manipulation regime, and a clearing house clears trades in the CDS indices.
Monday, July 9, 2012
Three Ways To Stop A Bank Run
On today's show, we walk through the three things you can do to stop a bank run — and figure out what options are left for Europe.
Source: http://www.npr.org/blogs/money/2012/06/05/154367546/three-ways-to-stop-a-bank-run?ft=1&f=127413671
Campaign Coverage Analysis
NEWSDAY's Les Payne and ON THE MEDIA's Brooke Gladstone on the press, the public, the candidates and the campaign.
Source: http://feedproxy.google.com/~r/bmjvodcast/~3/THoN9CDtkFU/profile2.html
The Key to Low-Cost Solar Cells
While thin film technologies are receiving worldwide attention with their potential to lower the cost of solar energy, there are researchers who are thinking outside the box and are looking into different approaches that will result in cost reductions for photovoltaic technologies.
One of those approaches comes with the collaboration of the Department of Engineering [...]
One of those approaches comes with the collaboration of the Department of Engineering [...]
Source: http://www.alternative-energy-news.info/press/key-low-cost-solar-cells/
Turn Your Old Nalgene Bottles into Solar Lights
Don’t throw away your old polycarbonate water bottle – turn it into a solar lantern! The last thing this planet needs is any more plastic in the landfills. But what do you do with your old polycarbonate water bottle (Nalgene or similar) that you don’t want to use any more? Don’t throw it away! [...]
Source: http://www.alternative-energy-news.info/press/solar-light-bottles/
Golden Age a Thing of the Past
It's been a long time coming, and we hate to be the ones to break it to you, but the Golden Age of Retirement may be over. The signs have been there for years, and the outlook grim, but at this point, there's just no denying the facts.
There's a good chance that you have a relative who is still living out his or her Golden Age. It's a little like window shopping. You can see what they're getting, and it's within your grasp, but there's something keeping you from it. Of course, that doesn't mean that achieving the equivalent of the Golden Age is impossible. It's simply going to take a lot of work.
Let's look at some facts, shall we?
Fact #1: Older Baby Boomers don't know how well they have it.
It's a bit simplistic to say that older Baby Boomers have it "easy." Easy is a relative term, one up for debate. But the fact remains that in a lot of ways, Baby Boomers have had a cushier time of retirement. Many of them are doing well for themselves financially, due to windfalls such as company pensions. Some even have sizable inheritances. And statistically, they have a greater chance of maintaining a good amount of equity in their homes.
Fact #2: The Great Recession was devastating.
It's been nearly five years since the Great Recession started, and two years since it officially ended. A number of people, too large a number really, were devastated by what occurred. Many of them lost their jobs, and some individuals approaching retirement had no choice but to retire. This financial crisis also cut down on the number of large inheritances that had been provided to Baby Boomers in the past.
Fact #3: Personal responsibility appears to be waning.
It is an unfortunate fact that many people play the "blame game." When something catastrophic happens, like a plunging market or the loss of their job, a number of people react by trying to find someone to blame. They accuse executives of wrongdoings, cast aspersions on those in the government, and even try to find fault with their own relatives who might have suggested a specific financial strategy that went wrong.
While some or all those things might be to blame, it is important that you also take some personal responsibility when it comes to your retirement planning. The truth is, many people aren't saving anything for their retirement. Not "a little." Not "just enough." Nothing ... or very close to it. Procrastination seems to be a part of the American tradition in a lot of ways. And as you can imagine, putting off saving for your future isn't exactly the best plan. Yet millions are joining the fray.
Fact #4: Spending has not stopped.
This is an offshoot of "personal responsibility." For several years, Baby Boomers became accustomed to a steady flow of cash. If they wanted to buy something, they bought it, often without looking at the price or the balance of their checkbooks. They knew they had money, and even if they began running low, they had a pension, inheritance, or some other financial windfall to held carry them through their retirement. Strangely enough, individuals who are now approaching retirement are also taking that same stance. The problem, of course, is that this Golden Age is over, and thus, so is the "willy nilly" spending. It's time to tighten those pocketbooks and realize that times have changed.
Source: http://firstsecurityfinancialshow.com/blog/bid/169444/Golden-Age-a-Thing-of-the-Past
Jim Cramer Explains: The 3 Troubles With Target-Date Funds
Filed under: Retirement, Investing
By Jim CramerIt was supposed to be so easy.
Target-date funds were designed as the buy-and-forget investment, especially for retirement accounts.
Investors choose a fund with the target date of the year they will turn 65 or expect to retire.
A 43-year-old worker, for example, would buy shares in a fund with a target date near 2040. A 55-year-old would buy a 2022 fund. You get the idea.
As the target date comes closer, the fund automatically shifts from more aggressive to more conservative investments.
The promise of automatic asset allocation and diversification has prompted plan sponsors and participants to swarm to target funds (and their precursors, known as life-cycle funds).
Assets in target-date funds have jumped from $71 billion at the end of 2005 to nearly $378 billion at year-end 2011, according to Morningstar.
What's more, 72% of companies offer target funds as the default investment for workers who don't specify where they want their money to go, according to a recent survey from Towers Watson.
To be fair, target funds are probably better than defaulting to a money market fund or throwing darts to pick your 401(k) options -- something plenty of 401(k) participants do, unfortunately. But like any heavily hyped investment, these things are flawed. Extremely flawed. Let me count the ways:
Performance. Target funds weren't immune to the market chaos starting in 2008. The average 2010 target fund, for instance, lost 22% in 2008 while the average target-date funds for 2036 through 2040 lost 39%, according to Morningstar. The next two years brought healthy bounce-backs for the average target date fund in every time frame, but in 2011 the group underperformed again, with almost all funds showing losses.
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Actively managed target funds are particularly susceptible to poor performance, says David O'Meara, a senior investment consultant with Towers Watson. (More than 50% of target fund assets are in actively managed funds.)There's a simple reason why they don't do well.
"Most fund companies don't have the skill set to outperform the market in every asset class -- large-cap, small-cap, non-U.S. equities and fixed income," O'Meara explains. "It's hard enough to outperform one market benchmark, but then when you start packaging 10 or 20 managers, most organizations are going to fail to outperform."
Fees. Most target funds are basically a fund of funds, so fees add up quickly. As always, index funds will be the least costly -- Vanguard's index target funds charge 18 basis points in expenses -- but some companies charge significantly more than 1% in expenses for actively managed target funds.
These fees take a big chunk out of your nest egg. According to a recent Towers Watson white paper, the average worker making $125,000 over the course of a career who pays $20 in fees for every $10,000 invested in target-date funds would lose three years worth of retirement income to fees. The same worker who paid $100 in fees for every $10,000 invested, would lose 15 years worth of retirement income. That's a lot of cruises and greens fees going to fund companies.
The Right Target. Making sure the target funds offering in your 401(k) are right for you takes a lot more work than simply picking the date closest to your retirement year.
The way target funds are allocated among different asset classes up to and beyond your retirement varies widely. Some may keep a majority in stock, even past retirement date. Others may move to a majority in fixed income well before you retire. Still others may invest in REITs and commodities to further diversify the fund, which can be a good thing, especially if these sectors aren't represented elsewhere in your 401(k) investment menu.
The point is investors still have to do plenty of homework to make sure their default option is invested the way they want it to be. There is no such thing as buy and forget.
Because you have to manage target funds the same way you would any other investment, why not throw yourself in completely and come up with your own investment picks that offer diversification and -- one hopes -- much higher returns.
More on TheStreet
- Jim Cramer's Best Blogs
- Cramer: The Disgrace of a Stock Lifetime
- 10 Most Convenient Cities in America
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Source: http://www.dailyfinance.com/2012/06/11/jim-cramer-explains-the-3-troubles-with-target-date-funds/
Pop goes the knee-ble
We had a massive wind with rain go through on the night of the 25th. A plow wind. mean. about 118 KMH. It took out all sorts of trees and building and such. On the 4th we had big winds go through here again minus the rain. I thought I heard a crack but never saw much. Yesterday when I went out to cut the grass, I saw that one of our big branches cracked and was down over the fence in the neighbour's yard.
When DS1 got home from his work out, I fed him and off we went. His grandfather (my dad) would have been so proud of how he was up 30 ft in the tree and jimmying a rope pully system for me to yank the branch out as he cut it free. We missed the fence by (__) thismuch. I am pleased to see how much he has grown and learned. I tell ya, he's had me worried a time or two.
While hauling those big ass branches to the truck to haul away, I felt a very unhappy pop. My left knee. Seriously you could hear the pop and feel it go. Needless to say I didn't walk well at all last night. A cane would have been good. It is less painful today but still not all healed. Getting old sucks man.
Here is the truck, all full of branches, getting tied down for the trip to the farm for dumping.
When DS1 got home from his work out, I fed him and off we went. His grandfather (my dad) would have been so proud of how he was up 30 ft in the tree and jimmying a rope pully system for me to yank the branch out as he cut it free. We missed the fence by (__) thismuch. I am pleased to see how much he has grown and learned. I tell ya, he's had me worried a time or two.
While hauling those big ass branches to the truck to haul away, I felt a very unhappy pop. My left knee. Seriously you could hear the pop and feel it go. Needless to say I didn't walk well at all last night. A cane would have been good. It is less painful today but still not all healed. Getting old sucks man.
Source: http://shakingthemoneytree.blogspot.com/2012/07/pop-goes-knee-ble.html
Foreign Policy and a New President
What will President-elect Obama's promises of change mean for the Middle East? JOURNAL guest host Deborah Amos sits down with Elizabeth Rubin, the Edward R. Murrow press fellow at the Council on Foreign Relations, and Slate magazine columnist Fred Kaplan.
Source: http://feedproxy.google.com/~r/bmjvodcast/~3/OeEM2xX8IRo/profile.html
Top Summer Vacation Spots in Canada - Montreal in the Summer
Montreal in the Summer
It can get very hot and humid in Montreal each summer but that doesn’t stop millions of people from visiting Montreal and attending all of the great festivals that happen every summer. Along with all of the festivals you’ll find delicious restaurants, active nightlife, museums, art galleries, fun shopping, amazing firework displays, thrilling amusement parks and more. Although I can’t cover everything Montreal has to offer in today’s post, let’s take a look at a few of the special attractions that you will find when you visit Montreal this summer.
Montreal Fireworks Competition
I love fireworks anytime, anywhere. Since 1985 Montreal has hosted one of the world’s largest fireworks competitions. One of the special parts of these firework displays is that they are synchronized to music. The firework competitions begin at the end of June. In the past they took place every Saturday and Wednesday night until the end of July.
The Montreal Fireworks schedule has been changed for 2012 to include Friday nights and Tuesday nights, as well as some Saturday nights. The first night will be Saturday, June 30th and the featured country will be Japan. The following dates are July 7, 14, 17, 21, 24, 27, 31 and August 3rd.
Viewing the Montreal Fireworks
If you want to watch the fireworks competition for free you can go to the Old Port or the Jacques-Cartier Bridge, which closes off the car traffic as of 8 p.m.
If you would like to get a closer and better view, and listen to the synchronized music while you watch the fireworks, then you want to head to La Ronde, just in front of the Lac des Dauphins. La Ronde is a Six Flags Theme Park.
Montreal Theme Park
Take the family for a fun filled day at La Ronde, Montreal’s Six Flags Theme Park. With over 40 rides stretched across 146 acres you will find rides for the whole family to enjoy including the kiddie rides, panoramic rides that offer a beautiful view and thriller rides that make you scream. La Ronde is open from May until October. 
Montreal Shopping
Head underground for some of the best shopping in the world. Under downtown Montreal you will find what is known as the indoor city. You will feel quite comfortable and safe as you walk through the well lit, air conditioned tunnels that are lined with shops on both sides. The tunnels connect to shopping malls, apartment buildings, banks, offices, hotels, museums and condos. You will definitely not feel trapped as there are over 120 exits.
The Underground City of Montreal was designed to help people get around in the brutally cold winters and the very hot summers. Many visitors to Montreal have said that once they discovered the underground they never left as they were able to easily get from their hotel to all of the restaurants and shopping that they needed.
Beer Festival
If you enjoy a good cold beer you won’t want to miss the Montreal Beer Festival that takes place in early June. This festival is a taste testing beer festival and this year it will include approximately 637 different beers from 191 breweries. This festival runs for 5 days and offers four-ounce samples of each beer for you to try throughout those 5 days. As you venture through the festival and taste the beer you will also find live brewing demonstrations held from 11 a.m. to 5 p.m. As well the beer festival in Montreal includes food such as alligator soup and kangaroo burgers and fun events such as mini disk golf tournaments, beach volleyball and silent dancing.
Admission to the festival is free but each tasting glass is $9.
Montreal Jazz Festival
For those who love a wide variety of music, the Montreal Jazz Festival is the place to be this summer.
The Montreal Jazz Festival attracts over two million people each year to both the indoor shows and as well as the free outdoor shows.
The jazz festival features many well known entertainers such as Diana Krall, Prince, Pat Metheny, Ray Charles, Sade, Dave Brubeck, The Roots, Smokey Robinson, Esperanza Spalding and Robert Plant.
This year’s festival runs from June 28 to July 7, 2012. If you enjoy listening to Reggae, African, Cuban, Brazilian, Latin Jazz and the blues you will not want to miss this festival.
And speaking of the Montreal Jazz Festival, in 2009 Stevie Wonder performed at the jazz festival and paid tribute to his friend Michael Jackson several times during the festival. Here is one of his live performances at the festival in Montreal.
Source: http://tacklingourdebt.com/2012/05/28/top-summer-vacation-spots-canada-montreal-summer/
jpmorgan: RT @isaackeyet: Wait.. Is that @IntenseDebate on this @Nike promo page? http://t.co/UNsBhpBh #youtube via @beaulebens
jpmorgan: RT @isaackeyet: Wait.. Is that @IntenseDebate on this @Nike promo page? http://t.co/UNsBhpBh #youtube via @beaulebens
Source: http://twitter.com/jpmorgan/statuses/204682204687777792
Robert Kuttner and Matt Taibbi
Amidst fading hopes for real reform on issues ranging from high finance to health care, economist Robert Kuttner and journalist Matt Taibbi join Bill Moyers to discuss Wall Street's power over the federal government.
Source: http://feedproxy.google.com/~r/bmjvodcast/~3/0R2wEiSLwoc/profile.html
Emma Coleman Jordan
Georgetown University's legal and finance scholar Emma Coleman Jordan looks behind the headlines, and the politics, of the Wall Street bailout debate on the Hill and on Main Street.
Source: http://feedproxy.google.com/~r/bmjvodcast/~3/yNR4-dsxs8E/profile3.html
Sunday, July 8, 2012
The Company That Could've Been Facebook Goes Back to School
Filed under: Technology, Facebook
A blast from the past is making new waves in social networking. United Online (UNTD) -- the parent company of Classmates.com -- is acquiring schoolFeed. (Terms of the deal aren't being disclosed.)
SchoolFeed is a fast-growing app on Facebook (FB) that connects users of the world's largest social networking website through their alma mater affiliations. There are now more than 19 million Facebook users tethered to schoolFeed, and the app is tacking on roughly 100,000 new registered users daily.
Sure, 19 million is a far cry from the more than 900 million active Facebook users, but there's probably a good chance that you've received a request from one of your Facebook pals to connect through schoolFeed.
The Rise and Stall of Classmates.com
Classmates.com was an early arrival on the dot-com social networking scene. Its goal was -- and continues to be -- to connect high school and college alums who wax nostalgic. The website was formed in 1995, nearly a decade before Mark Zuckerberg redefined the way that friends engage with one another online.
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United Online acquired Classmates.com for $100 million in 2004, just as Zuckerberg was starting to shake up the Harvard campus. United Online thought that it was getting a bargain in the aftermath of the dot-com bubble, but Facebook succeeded at the social networking game in a way that Classmates never did.
The problem with Classmates was that the model called for premium memberships. Only paying subscribers had easy access to other paying members. Maybe it would've worked, but then free ad-based social networking disrupted the model.
Friendster, MySpace, and eventually Facebook didn't install tollbooths. They understood that scaling in size meant providing open experiences for free. As Facebook evolved from campus-specific networks to global connections, Classmates and its archaic model never stood a chance.
An Ugly, Dated Model
Classmates offers free registrations, but the available features are limited. Users need to purchase Memory Lane All-Access Passes to see who's checking out their profile, and to read and reply to every message they receive.
The rates are reasonable. The All-Access Pass starts at $15 for three months and goes up to $59 for two years. But paying a cover charge doesn't make a lot of sense when Facebook -- with its larger collection of registered users who went to school with you -- is available for free.
Facebook, on the other hand, went public with a market cap of $104 billion, and even after a swift sell-off is still roughly 170 times more valuable than United Online.
The SchoolFeed acquisition should help increase awareness for Classmates.com and its Memory Lane efforts, but is there any likelihood it will help United Online finally get right what it has been fumbling since 2004?
As long as Classmates.com is run with the velvet rope philosophy that demands people pay a premium to engage with a smaller subset of their schools' alumni than Facebook offers for free, SchoolFeed won't be any kind of fix for United Online's woes.
Business models matter. Classmates was fashionably early to the right party, but with the wrong model.
Motley Fool contributor Rick Munarriz does not own shares in any stocks in this article. The Motley Fool owns shares of Facebook.
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Source: http://www.dailyfinance.com/2012/06/13/Classmatescom-buys-SchoolFeed-facebook-app-social-network/
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