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Recommended reading, economic debates, predictions and opinions.

Postby ghariton » 26 Jan 2007 01:25

millergd wrote: telco business marketing employees


An oxymoron, in my experience.



Manages to summarize much better in less than two minutes what some of us have been saying at length for twenty years. Thank you.

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Postby Bylo Selhi » 26 Jan 2007 14:43

ghariton wrote:
millergd wrote: telco business marketing employees
An oxymoron, in my experience.

Which word(s) combination(s)? :twisted:

Meanwhile for your reading enjoyment, Bell commissions Ipsos-Reid to discover the obvious, that Canadians Support the Federal Government’s New Local Telephone Policy [PDF]
A new Ipsos Reid survey reveals that Canadians support recent policy measures taken by the Minister of Industry, Maxime Bernier, to reduce regulation in the local telephone services market.

A clear majority of seven in ten (68%) indicate that these regulatory changes would be “acceptable” to them and 25% say these changes would be “very acceptable” to them. Moreover, the same strong majority of

Canadians (68%) indicate that they would find such changes acceptable even in local telephone markets with just two telephone providers. A majority of Canadians also agree that:
* “All companies that compete in the field of telecommunications should be treated the same way by federal policies” (93% agree);
* “Traditional telephone companies should be able to waive service charges, like a $55 re-connection fee, as a consumer promotion” (87% agree);
* “If a consumer switches to a different residential/home telephone service provider, traditional telephone companies should have no restrictions and should be able to immediately compete to win-back that consumer’s business” (85% agree); and
* “Philosophically, I believe that consumers, not government regulators, should determine what price to pay for residential/home telephone services” (77% agree).

The high degree of support from the Canadian public for these new policy measures is likely driven in part, by the fact that most (61%) feel, in their situation, there is an adequate choice of competitors from which they can buy local telephone service.

Other prominent findings further indicate strong support for the Federal Government’s new policy:
* 82% support the removal of restrictions on the traditional telephone companies’ ability to bundle services (45% strongly support);
* 79% support the removal of promotional restrictions faced by traditional telephone companies (38% strongly support); and,
* 63% support changes resulting in the Competition Bureau, as opposed to the CRTC, now having oversight of the local telephone services market and the ability to seek fines if companies were to act improperly (25% strongly support).
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Postby Taggart » 27 Jan 2007 09:59

When market timing really can pay

By Jonathan Davis
Published: 27 January 2007
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Postby Taggart » 28 Jan 2007 14:53

Clawbacks, taxes make RRSPs a poor choice for low-income Canadians: experts

January 28, 2007 - 11:39

By: BRUCE CHEADLE

OTTAWA (CP) - At age 63 and facing a very modest retirement income, Greta Doucet is cashing out what's left of her meager nest-egg as fast as she can.

"I have a little bit left, but if you don't have a fairly large amount, you're just shooting yourself in the foot," said the part-time nurse and seniors advocate from New Brunswick. "You don't have enough to get yourself anywhere."

Converting her last $15,000 in RRSPs into cash and pumping the money into the mortgage of her Moncton home may sound like financial heresy in this season of wall-to-wall investment ads, when Canadians are being implored by financial institutions to max out their registered retirement savings.

But Doucet is simply following the best advice of experts who fully understand Canada's complex public pension system.
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Postby Norbert Schlenker » 28 Jan 2007 15:33

From the Cheadle article ...

Government retirement programs will provide Doucet between $16,000 and $17,000 a year, which is poverty level in Moncton.

I'm sorry, but I don't believe that a single person with a house and an after tax income of $15-16k a year in Moncton qualifies as "poverty level".

I think Ms. Doucet's plan (like Dickson's Free Parking plan) is worth considering for a lot of people. Sink all your money into a house, paying off any mortgage. Claim a property tax deferral if possible (and it's possible in many places now, although I can't say for Moncton). Collect $16k a year after tax from the government, plus whatever other freebies are offered to "low income" seniors.

I don't think that's "poor" under any reasonable definition of the word.
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Postby Taggart » 28 Jan 2007 15:47

Norbert Schlenker wrote:From the Cheadle article ...

Government retirement programs will provide Doucet between $16,000 and $17,000 a year, which is poverty level in Moncton.

I'm sorry, but I don't believe that a single person with a house and an after tax income of $15-16k a year in Moncton qualifies as "poverty level".

I think Ms. Doucet's plan (like Dickson's Free Parking plan) is worth considering for a lot of people. Sink all your money into a house, paying off any mortgage. Claim a property tax deferral if possible (and it's possible in many places now, although I can't say for Moncton). Collect $16k a year after tax from the government, plus whatever other freebies are offered to "low income" seniors.

I don't think that's "poor" under any reasonable definition of the word.


Three things we don't know:

1. How much of the mortgage is yet to be paid off.

2. The condition of her house.

"Converting her last $15,000 in RRSPs into cash and pumping the money into the mortgage of her Moncton home may sound like financial heresy in this season of wall-to-wall investment ads, when Canadians are being implored by financial institutions to max out their registered retirement savings."

3. How long she'll be able to live in the house, before having to sell.

"To get my house in order and keep my house as long as I can, that's the goal I'm aiming for. The RRSPs are gone."
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Postby Bylo Selhi » 28 Jan 2007 16:04

Taggart wrote:2. The condition of her house...
3. How long she'll be able to live in the house, before having to sell.

How would a retiree with no RRSP, no other savings and no other source of income deal with the need for a new furnace (especially this time of year), a new roof or similar major expenditures? Would she be able to get a loan based solely on her OAS/GIS income and, if so, at what rate of interest?
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Postby 83_gemini » 28 Jan 2007 20:40

I think CPP etc. is solvent. Is it very well indexed? Is it politically secure in the long run? It's true that private savings are also subject to political risks, but they can't be quite as subject.
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Postby brucecohen » 28 Jan 2007 22:04

83_gemini wrote:I think CPP etc. is solvent. Is it very well indexed? Is it politically secure in the long run? It's true that private savings are also subject to political risks, but they can't be quite as subject.


The CPP's last valuation concluded that it's sustainable at current benefit and contribution rates for the 75-year life of the projection.

CPP starting benefits are indexed to growth in the average wage. Once the pension is begun benefits are fully indexed to the rise in the CPI.

CPP is actually less subject to political risk than the RRSP program, though the RRSP program is subject to very little political risk. The reason that CPP is less immune is because the RRSP rules are entirely under federal jurisdiction and can be amended by Parliament through the normal legislative process. CPP is jointly sponsored by the federal and provincial governments. Any change in its governing legislation requires approval of two-thirds of the provinces representing two-thirds of the population -- the same formula that applies to constitutional amendments. That said, there is an automatic fail-safe in the CPP rules that would kick in if the current 9.9% contribution is not enough to keep the plan sustainable and the sponsoring govts can't agree on what to do. In that case, the contribution rate will be raised and the inflation-indexing formula will be cut in roughly equal proportions so everybody -- active workers and retirees -- shares the pain.
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Postby Taggart » 29 Jan 2007 10:10

What’ve ants got to do with it?

Vivek Kaul
Sunday, January 28, 2007

MUMBAI: One of my professors had this habit of remarking “ Since we are all born on this mother earth, there is some sort of synergy between us”. What he probably meant was “ Individuals do not act in isolation, but affect each other in complex ways”, as Paul Ormerod writes in the book “Butterfly Economics”.
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Postby Taggart » 29 Jan 2007 11:45

'Spider' crawls Internet for tax evaders

Updated Mon. Jan. 29 2007 10:10 AM ET

CTV.ca News Staff

Revenue Canada is testing a software program known as a "spider" that's designed to crawl the Internet searching for tax evaders, according to a report.
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Postby Bylo Selhi » 29 Jan 2007 12:15

Last edited by Peculiar_Investor on 07 Feb 2014 08:04, edited 1 time in total.
Reason: replace old domain name with www.financialwisdomforum.org to reflect new domain name effective 19-Jan-2014
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Postby Maciek » 30 Jan 2007 09:24

Chinese United by Common Goal: A Hot Stock Tip

Less than two years after share prices collapsed, China’s stock markets are almost going mad, actually, with the leading Shanghai Composite Index approaching 3,000 and Chinese investors flocking to buy shares in record numbers. The bull market is so powerful — the Shanghai market hit a record high last week and was among the best performing in the world last year — that one senior Chinese official has warned against “blind optimism.”

College students, young professionals, retirees and others are buying individual shares or investing in China’s swelling mutual funds. One mutual fund raised $5 billion in a single day. Day trading, meanwhile, is becoming popular with investors, many of whom monitor the market from home on personal computers.


http://www.nytimes.com/2007/01/30/world ... r=homepage

Also, for reference with the article:

http://finance.yahoo.com/q/bc?s=000001. ... z=l&q=l&c=

Bull or bubble ? :)
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Postby Taggart » 30 Jan 2007 20:42

Bull and Bear Served at Fund Manager Dinner

1/30/2007

In the bull corner, as usual, was Jeremy Siegel -- professor at University of Pennsylvania's Wharton School of Business, and author of the popular investment tome Stocks for the Long Run. In the bear corner, also as usual, was Jeremy Grantham, veteran chairman of Boston fund firm GMO.
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Postby Bylo Selhi » 31 Jan 2007 17:20

Carhart, Cochrane, Fama... Some pretty impressive names being tossed about. Does this belong here or in the financial pornography page? (i.e. is this the next chapter in Extraordinary Popular Delusions and the Madness of Crowds?)

Loss at Goldman Hedge Fund Racks Duo at Secretive Global Alpha
Mark Carhart looks out over the packed New York conference and tells investors that Warren Buffett has it all wrong... Though he doesn't like to talk about it, Carhart is one of the world's most successful money managers, a mastermind behind Global Alpha, a $10 billion hedge fund for wealthy clients and employees of Goldman Sachs...

Carhart, a former assistant professor of finance at the University of Southern California, helps oversee other hedge funds, four mutual funds and scores of separate accounts. In all, he and Iwanowski have $101.5 billion at their command. Carhart and Iwanowski use math-heavy trading tactics that fund consultant Sol Waksman likens to counting cards in a casino. The two lead a corps of computer-loving traders, statisticians and finance and economics Ph.D.s...

Carhart never reveals the secrets. Old friends and people who've invested in the fund say they're not really sure how it works. John Cochrane, one of Carhart's professors at the University of Chicago, says that based partly on what Carhart has told him -- not much, he admits -- Goldman Sachs has devised five or so proprietary risk factors for equity markets...

Fama still recalls how hard Carhart worked on his dissertation, entitled ``Survivor Bias and Mutual Fund Performance.'' Carhart found a company in Des Moines, Iowa, that had kept old data on mutual funds, Fama says. Carhart had the numbers keyed into a computer by hand -- a process that took several years. Using this database, he found that mutual fund figures artificially inflated returns because fund companies tended to shut laggard funds or merge them into other funds, stripping their performance numbers from totals.``He's one of the most-persistent people I've met,'' Fama says of Carhart. Today, the database lives on at the Center for Research in Security Prices at the University of Chicago...
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Postby Taggart » 05 Feb 2007 09:27

Private equity cycle to end badly, commodities expert warns

SYDNEY (MarketWatch) -- The debt-laden private equity market is headed for a shakeout and will exacerbate the pain from the next sharp downturn in world financial markets, commodities expert Jim Rogers said Monday.
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Postby Norbert Schlenker » 05 Feb 2007 15:46

Nothing can protect people who want to buy the Brooklyn Bridge.
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Postby Bylo Selhi » 05 Feb 2007 15:52


Maybe if he holds on to them for a few decades until they become rare collector's items... :twisted:
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Postby WishingWealth » 05 Feb 2007 15:55

[url=http://www.slate.com/id/2159098/]Google Boggle
One analyst says it's worth $415 a share. Another says $650. Another $601. Don't listen to any of them.
[/url]
Blodget in Slate.
...As financial reporting and automated spreadsheets have become more advanced, moreover, the sense that price targets and other similar estimates are, in fact, estimates has largely disappeared. Bank of America's Brian Pitz, for example, painstakingly concludes that Google is worth precisely $601 per share—after making several subjective assumptions that, slightly tweaked, could easily have pinpointed its value at, say, $428 or $642 (or, for that matter, if Brian were in the mood to forecast extremes, $189 or $1,033). The $601 target is no doubt of great comfort to Bank of America's legal and compliance departments, because the diligence, precision, and reasonableness of Brian's calculations are indisputable. Unfortunately, the faux-precision implied by the target is a mirage.

The safest way to think about stock values is to recognize that even the best analyst is the equivalent of a blindfolded hunter shooting at a moving target a hundred yards away. Given the extreme difficulty involved in hitting the target, the analyst's gun of choice should not be a rifle or laser beam. Rather, it should be a sawed-off shotgun.

Although Wall Street compliance departments will likely continue to insist that analysts create pinpoint price targets, smart investors should never forget what they really represent: the midpoint of a wide range of subjective guesses. In Google's case, even the Street-wide range of $415 to $650 is probably too narrow: It's reasonable assuming nothing radical happens, but in the stock market, "radical" events happen more often than they should statistically be expected to.

As John Kenneth Galbraith noted, there are two kinds of forecasters: those who don't know and those who know they don't know. If you must be a forecaster, at least be the latter kind.



WW
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Postby Taggart » 16 Feb 2007 13:16

Financial Times (UK)

Web offers dream of riches

By Ellen Kelleher in London

Published: February 16 2007 12:40 | Last updated: February 16 2007 12:40

The hundreds of personal finance blogs which have sprouted up in cyberspace can be quite seductive if you like to dream.
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Postby Taggart » 17 Feb 2007 17:36

A couple of important research findings from the 2007 Global Investment Returns Yearbook:

Sell Orders and Derivatives Limit Stock Returns, Study Shows

Forex may not matter to long-term investors
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Postby brucecohen » 18 Feb 2007 12:24

From the Sunday NY Times Magazine: How Toyota conquered the auto world
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Postby Bylo Selhi » 19 Feb 2007 10:32

From the Sunday Star, Toyota's troubles
No one's[*] accusing Toyota of harbouring the same complacency and institutional arrogance that has been gradually killing GM in the past three decades. But the world's most successful automaker is beginning to show signs of big-company disease... A troublesome by-product of Toyota's growth surge has been a decline in quality – the bedrock on which Toyota built its remarkable success in North America, where it derives the largest share of its profits. Since 2004, Toyota has recalled 9.3 million vehicles, up from 2.5 million in the previous three years. Last summer, the Japanese government censured Toyota and arrested three of its top executives for allegedly failing for eight years to disclose and act upon reports of a design flaw implicated in loss-of-control incidents...


[*] Wrong! I did a few years ago (on TWB) following my experiences in trying to get Toyota to own up to problems with my Camry ;)
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Postby Norbert Schlenker » 19 Feb 2007 15:04

Nothing can protect people who want to buy the Brooklyn Bridge.
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Postby Pickles » 19 Feb 2007 18:42



from the article:
JW: So if a working stiff puts $5,000 into a spousal RRSP, then puts the $2,000 tax refund into an RESP-- which kicks back a $400 federal education grant --he's laundered his money into two mini-Swiss bank accounts. The net outlay is three lousy grand while giving his wife and kid $7,400 in total. Any way you look at it, that's magic.


Seems to me it's bad math. Isn't the net outlay $5000, since he reinvests the tax refund?

Still, a cute article.
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