Myth465

To be quite honest I dont know anyone who simple failed out of college or couldnt get in. Community college usually has no barriers, alot of not so great colleges have no barriers, and everyone knows for profit schools have no barriers. Im fairly young and also found and think College is fairly easy. Most people I know dont succeed at it because they are lazy, were going for refund money, had a kid, couldnt afford it, or screwed around too much (drugs, sex, ect). Honestly I think most 50 year olds would be disgusted by what is considered the typical college experience. Also I dont think most of college is really value added. Its another hoop you have to jump through, but alot of it doesnt prepare you for the real world. At its current price its an interesting investment. I much prefer trade schools and apprenticeships similar to what they have in Austrialia or Germany. My issue is you will always have a 15% - 20% that will basically make up the bottom. Given everyone a college degree does nothing to solve that. I have been to countries where the cooks and taxi drivers had law degrees. Hell Spain is heavily degreed and that doesn't help much. A lot of knowledge can be taught, but I don't think general intelligence, skill, work ethic, and drive can be. Some people aren't going to have. The real question is what type of society we provide or allow for those who unfortunately lack some of these things. Also there arent enough skilled jobs for all of these folks anyway. There arent enough jobs for the current crop of college grads.... Some say cradle to grave care (actually no one does) and some say god helps those who help themselves. Im somewhere in the middle. Sorry for missing your original question. http://www.fredoneverything.net/Commentators.shtml - My thoughts were shaped a bit by this. I often see victims of Commentator’s Disease arguing against the minimum wage on abstract grounds of economic theory. It is what commentators do—bandy abstractions, railing for or against Keynes, assaulting their ideological opponents with pointed phrases. They have never had to do the arithmetic of forty times the minimum wage minus taxes minus bus fare minus rent and gotta pay the cable because it is the only thing they have after work. They have never had to choose between the electric bill and a new coat as winter comes on. The commentators don’t realize that not everybody is like them. Those with IQs of 140 and up (130 gets you into Mensa, I think) unconsciously believe that anything is possible. Denizens of this class know that if they decided to learn, say, classical Greek, they could. You get the book and go at it. It would take work, yes, and time, but the outcome would be certain. They don’t understand that the waitress has an IQ of 85 and can’t learn much of anything. Conservatives think in terms of merciless abstractions and liberals insist that everyone is equal. Not even close. Further, people with barely a high-school education and low-voltage minds regard any intellectual task with utter discouragement.

[amazonsearch]Money Ball[/amazonsearch] Anything by Michael Lewis is a must read inmo (and Seth Klarman's). I read this book after his recommendation. He said its the best book about Value Investing that's not an investing book. Its about a guy who builds a team with cheap players using unconventional metrics and methods. Highly recommended. I plan on seeing the movie, hopefully they have done a good job with it and it works as a good substitute.

It does when people quote or invoke his words in arguments, my basic point is Buffett tells Jane and Joe not to use leverage, but he himself has and does use leverage. Great advice for Joe and Jane though. :). This is what I dont get. Are people advocating paying off the house completely prior to investing in stocks?

True, but there is a major difference in that he gets paid while borrowing the insurance float. In good years ya, perhaps not this year though. What about him taking on leverage when rates were low during most downturns.

Watch what Buffett does not what he tells people to do inmo. Buffett borrows from time to time (generally long term and when rates are low), and inmo Insurance float is a form of leverage and / or spread investing....

I am currently reading Everything is Obvious which is a great book. It talks about how everything seems obvious, only after the fact. As I said earlier I dont have all the answers, but it seems that removing the progressive tax system would only exasperate the problem. The goal of the video is quite simple. You have a wife, lets share your wife with people who dont have one. I mean you only need her for a few hours a day. No Why are you against it. Its not fair. Well thats how a progressive tax system works for the federal government. --- My example is quite silly, but its really no different then his. I just think thats a stupid and immature way to conduct a conversation or have a debate. A few people will think its ingenious or cute, but .... I think things will get better before they get worse, and most of the recommendations from the right appear at least on the surface to only increase the gap. Perhaps raising taxes isnt the solution, but I dont see how continuing the experiment of cutting taxes will help. Its just not obvious to me. A simple solution to me though would be to look at countries who either have reduced the gap or dont have a huge gap and see what they have done. My guess is many Scandinavian countries will be on that list, and my guess is everyone knows what they do. I think we know what works, the question is does anyone actually think its a problem. I dont think the poor really know whats going on at this point, and I think the elites are fairly happy with the status quo. So we wait and see how things play out...

I liked the one poster that said to never invest money that can leave you homeless. I agree with this post here and also think FFHWatcher has some good rules regarding sizing. The responses so far have been very interesting though. You guys wouldnt borrow at 3-4% if it were locked at that rate for 20 - 30 years. Perhaps the home is a bit much, would you guys do it on a none owner occupied investment property? I would, but I would tell anyone who asked me it was a bad idea, because most people are well most people..... Also are you all completely debt free. I have student loan debt which I could pay off. The debt is at 3% and is still currently tax deductible. Why pay that off? I guess the article is addressed to Joe and Jane and in that case its a really bad idea.

I have been looking at this but I dont own a house. You can buy FTR at a 11% yield, Petrobakken at a 10% yield, Pennwest Energy at a 6.50% yield, and most international telecoms in Europe at a 10% yield. ATPG bonds are 15% YTM and I own the common. Plenty of ways to put together a portfolio yielding 7% with upside. My mom is buying a house and wants to put 20%-30% down. Not much you can do to talk her out of it. I think its a good idea for those on the board, but foolish for most people. The beauty is you can lock up 20 year capital and wont have to worry about fluctuations. Swizzled talked about this being his plan in terms of investing going forward (having unlevered property going into a crisis and then taking out Home Equity loans).....

I have never seen a bullish Kyle Bass, with that said I tend to agree with him.

I thought it was a pretty good interview. Hopefully he can help in Europe...

Stocks are cheap and I, have been fully invested since March 2009. As of now I have 8% cash and will only buy on a down 4%-5% day and will sell on a pop up. I plan to hold what I have for the most part unless something runs pretty hard. This could go any number of ways and most of those ways will be brutal so I plan to wait to see where things end up. If I miss a 10 point rally so be it inmo. Unlike 2008 there is no easy decision like bail everyone out and print the money. They could do that, but things will have to be fairly bad stock market and bond market wise before it came to that. All the other options look just as grim, everything is so interconnected and the key players seem pretty keen on staying apart...

I use ITA mainly. This is quite nice, cant wait till they roll it out for international use.

I stated that the idiot Libertarian with the camera is an idiot. He is against progressive taxation and wealth transfers of all types that was the point of his lame video. My main comment was his video was idiotic, because he is comparing two things that are not equal in any sense. Its like me asking you to share your wife with a man with no wife, and then when you say no saying well thats what our tax system does. Also I have never said the richest 1% or the evil bankers are to blame. I simple stated that at some point things will go loopsided and their may be a revolt. As I said prior, I dont have all the answers but this guy doesnt even know the question. You are probably right though Globalization has turned our society to a winner take most type of society - The same has happened in sports, media (books, movies, art), and all types of things. My point is that the losers will demand a fair share at some point, and there are millions and millions of them. You can give up a little to maintain a pretty nice situation or risk it all going for broke. Im in the give up a little camp (I believe this is what Buffett is thinking, but thats my guess), but many want to see how far this can go due to ideology. Also the middle class has spent silly trying to keep up (mostly with the Jones). This has come without a pay raise in 40 years, and due to leverage. As they stop spending and start deleveraging we will be in for an interesting time, especially when the Government joins them.

Your responses are always so interesting and none partisan / ideological...

The daily ticker has a few interviews with a Fed Govern who is against more action. He slightly addresses the forgotten man in one of the interviews. I tend to agree with him, that its up to Washington / the Markets. http://finance.yahoo.com/blogs/daily-ticker/;_ylt=Ahwsg.v5xHM3BNUfi7qx4uO7YWsA;_ylu=X3oDMTFjMnRndGtzBHBvcwMxBHNlYwNGUERhaWx5VGlja2VyQmxvZwRzbGsDdGhlZGFpbHl0aWNr Also another interview based on P&Gs new Strategy, They are moving towards an hourglass strategy because the middle is being hollowed out. Interesting. As America’s Middle Class Shrinks, P&G Adopts “Hourglass” Strategy http://finance.yahoo.com/blogs/daily-ticker/america-middle-class-shrinks-p-g-adopts-hourglass-145429009.html;_ylt=AinPSEJ2h1RO2JSs8FaQMnUp2YdG;_ylu=X3oDMTE2N2FuNWpsBG1pdANEVCBJbmRleARwb3MDMjIEc2VjA01lZGlhQmxvZ0luZGV4;_ylg=X3oDMTFvcGs0cnBnBGludGwDdXMEbGFuZwNlbi11cwRwc3RhaWQDBHBzdGNhdANibG9nBHB0A3NlY3Rpb25zBHRlc3QD;_ylv=3 The shrinking of America's middle class and rise of a two-class society has been well documented. (See: America's Middle Class Crisis: The Sobering Facts) The statistics are grim but bear repeating: The top 1% of Americans control nearly a quarter of all the country's income, the highest share controlled by the top 1% since 1928, according to The Stanford Center for the Study of Poverty and Inequality. The U.S. ranks #3 among all the advanced economies in the amount of income inequality. In 2007, the top 10% of American earners pulled in 49.7% of total wages, the highest since 1917. The top 5% of Americans by income account for 37% of all consumer outlays, according to Citigroup. On Tuesday, the Census Bureau reported the U.S. poverty rate rose to 15.1% in 2010, up from 14.3% in 2009 and its highest level since 1993. In addition, real median household income fell 2.3% last year to $49,445. I could go on, but you get the picture and sometimes. ---- Of course 15% in poverty is not enough, lets stop redistributing grades..... In the interest of self preservation as someone in the middle and hopes to join the top, I just think its a dumb argument at some point the scale will tip. Financial Darwinism, will be proceeded at some point by actual Darwinism. Us finance types usually arent too fit. The video is a kid using a dumb analogy about a serious issue. I dont have the answers but this guy doesnt even know what the problem is......

Im sure you can see the weakness in the analogy you just dont agree with it. You can reference some of them in the video / youtube comment section or just pull up any Buffett interview over the last 5 years. The 2 items simple arent very comparable which makes the video ..... Me typing for 20 minutes wont help with that inmo

Sorry to interrupt but that's just a stupid video. There are better arguments then this dumb comparison.

Thanks for the notes.

Hester thats basically where I am politically. The real question is what about Mr Texas. As a Texan I dont think the Texas model exports well....

Of course the private sector will take care of this sort of thing. Who needs food inspectors. Im trying to figure out how all of these things got tied together politically. Some relate of course but .... http://www.latimes.com/business/la-fi-turkey-recall-20110912,0,2926101.story The voluntary recall, announced Sunday by Cargill Inc., comes in the wake of one of the largest meat recalls in U.S. history: As of mid-August, health officials had linked a strain of salmonella found in contaminated turkey products to 111 people falling ill in 31 states and at least one death in California. Google Finance pulls up stories at very interesting times.

Damn thats a long read that I will get to soon enough. Read it all, a very scary article. Thanks for it, definitely shows there are no free lunches. Thanks again for the article, I sold some things in the morning at a nice gain to quoted prices now... ----- The most interesting thing that I came across was someone who stated that if Greece left the EU and devalued, they would receive a huge windfall in tourist revenue. I know I went to Croatia (still expensive) instead of Greece due to the Euro. What happens to Italy and Spain when tourists flock to Greece, or when politicians see that the masses are no longer in the squares there. Greece, Spain, and Italy have never been competitive. From what I have read, they simple devalue when things get out of wack. The poor dont travel or hold international assets, and the elites just convert currency over as needed to save in safe currency. Expecting Greece, Spain, or Italy to reshape their public sector, tax regimes, and cut salaries 20% - 30%, and endure a decade of slow to no growth is a foolish expectation in my opinion. Easier to print. European vacationing will definitely pickup if this doesnt end in a stronger more intertwined euro. I think Germany is making a slight miscalculation. Strong currencies and exporter of machine tools dont work well together. They will end up with the Duestchmark and will be priced out of the export game if they dont give up anything. They want to codify rules that I dont think the Southern countries can abide by. Its like the US asking Louisiana not to be towards the bottom of the list in education or road maintenance. ----- Here are Krugman's thoughts. This might be a good week for cash, or a good week to not look at stock quotes if you are tapped out... http://economistsview.typepad.com/economistsview/2011/09/paul-krugman-an-impeccable-disaster.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+EconomistsView+%28Economist%27s+View+%28EconomistsView%29%29

What about the none Econ stuff. EPA, Scopes Trial, Medicare, Medicaid, ect. I think he ruined his article with the econ stuff, because that is and will always be highly debated but what are your thoughts on the other items relating to science, and social issues. I don't think that I am the man to comment on your government programmes because I'm not very familiar with how they are structured. Morally, I'm instinctively opposed to just about everything and generally they always seem to end up wasteful. Given that they exist they can of course be everything from pretty benign to god awful, but I just dont't have the competence to comment on your domestic issues. I wouldn't call them non-econ, though. Government programmes are always a tradeoff with the functionality of market forces. I really can respect and admire your ability to say I dont know or I dont have enough info. Its something I wish I could do more often, and something I plan on working on. When I said none econ I meant the aside from the Keynesian related stuff, that also generates a roaring debate which is neverending and will turn alot of people off about the article.

Greece is a whole different ball of wax. I think the other three nations are manageable if their governments do institute strict measures to control spending and liabilities...not unlike Ireland. But what that means is a long deleveraging process, contraction of their economies, higher taxes, reduced services and possibly a stagflationary type of environment for a period of time. It also means protests, pain, political suicide and not saving face. Finally having to make hard choices! Cheers! The question is whats in it for them..... I see what Germany wants (control, they want to prevent devaluations to gain competitiveness and a single currency for ease of transactions) and what they are willing to give (not much). Without low bond rates, I dont see what the South gets out of this. Politicians will prefer to weaken currency vs. austerity.... I know I would...

Finally a step in the right direction - Towards a decision.... http://www.smh.com.au/business/world-business/germany-signals-possible-greek-default-20110912-1k4n6.html Monday should be quiet interesting.