Here is the 14th conversation I had with money manager Andrew Horowitz…. new insights for anyone who invests in anything. What to do? This chat is presented as-is for anyone who wants to listen in. We discuss the newest stimulus package. Has the market bottomed?
For Kindle and with free ePub version. Only $9.49 Great reading.
Here is what Gary Shapiro CEO of the Consumer Electronics Association (CEA) said: Dvorak's writing sings with insight and clarity. Whether or not you agree with John's views, he will get you thinking and is never boring. These essays are worth the read!
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Why can’t you subscribe to these in iTunes? Come on John, get with it.
You can subscribe at:
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Mr. Horowitz is slower to put up his MP3 but it is usually of better audio quality.
Until the banks get straightened out the US can’t recover. The bad assets have to be removed from the books, insolvent banks shut down, and healthy banks bolstered.
These conversations are my favorite items in ‘Dvorak Uncensored.’ Thanks, John!
You know, about once a month I try to listen to these reviews, but actually ANY STOCK ANALYSIS FROM ANYBODY, and all I hear are gambling addicts talking about their sure fire “system.”
Study after study show experts taken together do slightly worse than a monkey throwing darts.
The investors that make a difference are those that invest and then force changes in the company as they sell it off or ride the market they partially help control.
I love it when Horowitz while looking at the market bounce in Late November said “If you could have invested at the bottom in November, you could have made some real money.” And most expert opinions are just like that.–Real stupid. ((That quote was near the begining, not accurate, but close enough.))
The market is a lot like the gold rush: The people that made money were the people that serviced the fools risking their lives. Same on Wallstreet.
# 5 bobbo said, “The investors that make a difference are those that invest and then force changes in the company as they sell it off or ride the market they partially help control.”
Interesting. Can you point me to some more material on this? I’d like to read further.
With the most powerful supercomputers in the world, my local weather can only be predicted five days in advance with any degree of accuracy. Like the Earth’s atmosphere where those weather events are generated, the world economy to which the US economy is intimately tied is an extremely complex system with the additional wild card variable of human psychology added.
As a result, unless those making market predictions have a supercomputer at home running a stock market modeling program that achieves a degree of accuracy thus far not obtained by anyone, anywhere, their predictions of where the market will be six months from now or even a week from now should be considered to be little more than crystal ball reading.
#6–Paddy==years ago I looked at investing and realized the game was stacked against me from start to finish. Its legalized gambling with the rubes playing against the house. Most of the victims think they are “players” and they don’t even know the rules.
but I was thinking of Berkshire Hathaway and George Soros and Ichan==all different. They could all be just statistical outliers with no real expertise at all–just the expected outcome of cumulative odds on the roll of the dice.
Its all very sick==with the bailout on top of it. A nation captured by these fantasies.
# 8 bobbo said, “but I was thinking of Berkshire Hathaway and George Soros and Ichan==all different. ”
I do know that Warren doesn’t invest in industry that he isn’t very informed on. Yes, it is corrupt, not as corrupt as the banking sector but the stock market isn’t a good place for the uninformed. Which is most of the population…
One of the ways the system is stacked against the average/most investors is the glaring fact that the regulators are incentivized to ignore violations==a la Madoff/Enron etc but really “every” company.
One commentator a few days ago said to stop the revolving door from the SEC to Private Industry==why not give bonuses up even into the millions for those regulators who spot and stop corporate stock manipulations? It sets the government up to be adversarial to business (imagine the howls of profit driven enforcement agencies going after Martha Stewart?–or that football owner guy) but given every system has its pros and cons==why not have a bias that protects the public rather than the Masters of the Universe?
Repugs still don’t get that a tightly regulated stock market is necessary for investor confidence. Even now the repugs are cautioning against over regulation==obviously they think they can screw the pooch one more time before the government really catches on.
My crackpot un-based theory on why there was still a depression despite the gold rush:
The [insert evil power group here] needed to scoop all that gold ‘n silver up for cheap.
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That said, I’m fascinated with the number 30 trillion… how does that work out, after all that would be 30 trillion real dollars, as in gold. I don’t think 30 trillion Obama bucks would have the same effect since in effect, it’s dilution. would 30 trill Obama bucks save our asses?
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I drunkenly coin the term “Obama Bucks”
how do yo research this stuff john, where do you find refs?
I think people are forgetting one GIGANTIC factor in our current economic mess: the Federal income tax system.
Think about what’s so wrong with our income tax system:
1) We have 35,000 lobbyists in Washington, DC trying to tweak the tax code to support often very narrow constituencies.
2) The result is a tax code over 67,500 pages long so complex that the IRS–let alone tax professionals–have great difficulty figuring it out!
3) Americans are going to spending a mind-boggling US$350,000,000,000 in 2009 trying to comply with the Federal tax code. It may make accountants, tax professionals, Intuit, H&R Block and Jackson Hewitt rich, but to the expense of everyone else.
4) The Federal tax code by definition discourages savings and investment and encourages debt financing, with the sub-prime mortgage fiasco being the latest of the problems cause by the tax code.
5) American citizens and businesses are legally “offshoring” a large fraction of their net worth outside the USA just to keep it out of the hands of the IRS. Estimates vary, but the amount legally “offshored” is staggering: US$12 to US$16 TRILLION (that’s right, TRILLION).
6) Some Americans are forced to participate in the “underground economy” to keep their net worth out of the hands of the IRS. There are estimates of around US$3 trillion in economic activity from the “underground economy” that the IRS has difficulty getting their hands on.
7) American businesses are being forced to “offshore” corporate headquarters and goods production to keep their taxes lower. The result in obvious: higher unemployment, which hurts everyone all around.
It is high time that we seriously look at our Federal income tax code and radically change it or even do away with it altogether to avoid the issues I mentioned. There are three ways to go about this:
1) Reduce the maximum marginal rate to 20%, but cut out most of the deductions and tax credits. This results in a tax filing form about the same complexity as the 1040A short form, with vastly lower compliance costs.
2) Replace all income taxes with a single 4-6% flat tax with no deductions. The results in a tax filing form in grand total one page long, with extremely low compliance costs.
3) End all income taxation (personal income tax, corporate income tax, alternate minimum personal income tax, payroll taxes, capital gains tax, and estate tax) and replace it with a single 23% national sales tax (consumption tax) on all new-production goods and services, with a prepayment to cover the cost of the 23% tax to all legal residents of the USA (citizens, resident aliens, aliens with legal work visas, and foreign students enrolled in a institution of higher learning) up to the Federally-defined poverty level. This is the so-called “FairTax” plan that has been bandied about for about a decade.
While none of the three proposals are perfect, just reducing that staggering US$350 billion per year compliance cost and encouraging savings and investment would go a long way to help our economy recover, especially since it would encourage the return of at lesat part of that “offshored” money from Americans and new foreign investment because of our lower tax rates.