Myth465

Per a recent conference I attended with an Economist who focuses on energy. Natural gas has huge issues in terms of switching costs. WE dont have the infrastructure to run our cars off of natural gas or to supply all of the power plants in the US with it. I dont think the energy ratio matters much due to this. Ideally there should be a substitution but these items are not fungible. I cant just fuel my car or fly planes or any of the other material uses of energy with nat gas due to the infrastructure requirements. I have more hope on Exxon lobbying to correct some of these issues, and producers pushing LNG to create a world market for gas, that may however simply lower the world wide gas price.

Thank you sir, I cant wait to read next week. Will post my feedback then. You always seem to come across the most interesting content.

Which is why I think gas is simply going to remain low over the long term. There may be a black swan spike over a short period of time, but there is limitless supply waiting to come online should prices move up for any reason. Gas prices have a a natural ceiling. Why play the spike game when oil or other commodities have better long term fundamentals?

LOL I really like that. http://www.google.com/search?q=natural+gas+the+widow+maker&ie=utf-8&oe=utf-8&aq=t&rls=org.mozilla:en-US:official&client=firefox-a http://www.bloomberg.com/news/2009-09-15/natural-gas-widow-maker-seduces-unwary-investors-eric-pooley.html Thanks for the nick name, it makes complete sense.

I have been saying for about 8 months now that a ban due to Water contamination (and it may be needed based on all the smoke) would be a savor for conventional gas, which was not near population centers. SD has a very low person per square mile where they drill. Short of that gas prices are going down, which supply spikes here and there. That is until drillers gain and maintain discipline.

MMM, hot blonds. Hopefully I meet some on vacation in December. I dont think I can get a visa there, but am thinking of trying Australia on a work and holiday visa. Why Norway in particular.

Damn, very interesting . I have learned to never trust HR. Sounds like she was the smart money lol. I have had $8k - $10k losses and they still sting. $420k would be extremely painful, especially if I knew it was overvalued and couldnt do much about it. Could you have hedged out the risk, or would that have been an issue. It must have been interesting having that first hand account with regard to the media, and you have just pointed out another big whole with EMH and rationale markets. Thanks again, I will have too bookmark that one. Another LOL moment with the kids quote. Hopefully I never know whether thats true or not. Also very interesting to see how people get when they have a hand in creating something. That sucks for Dibee, terrorism just has a different ring to it after 9/11.

Thanks for the post.

Im a pessimist, or as I would say a realist. My goal is to make a positive return. The positive difference can only be made by a Dictator or the Electorate. One man one vote. I hold my nose and cast my vote for the least worst 1 day every 2 years. Every other day of those years I plan to focus on generating a positive return :)

Thanks. The movie is on the list and I will watch it one of these days.

Charlie Rose remains the best way for a person to expand their mental models. Covers Investing, Politics, Current Events, and Media / Entertainment. It and one other show are the only shows I watch daily. All about gold with John Hathaway, Peter Munk, & James Grant http://www.charlierose.com/view/interview/11330 David Einhorn, President of Greenlight Capital http://www.charlierose.com/view/interview/11333 Gold bugs could learn alot from Grant. He doesnt come off as a doom and gloom stock up on can food kind of guy. Disagree or agree, I will always be listening to what he has to say.

Its because of people like you the CPA exam is so damn hard :), and our tax system is so complex. --- The personal holding company tax is designed to prevent taxpayers from achieving unwarranted individual income tax deferral through the use of corporations to carry on essentially "personal" activities. By imposing a significant additional tax on the corporation for its undistributed income, the tax encourages corporations to make distributions to shareholders rather than accumulate earnings. Due to the potentially large impact of this tax -- and the costly litigation that certainly could accompany it -- practitioners should plan to avoid its imposition at the outset by understanding its requirements. Plain English definitions for the following: (1) a closely held corporation, (2) a personal holding corporation, and (3) a personal service corporation Generally, a closely held corporation is a corporation that, in the last half of the tax year, has more than 50% of the value of its outstanding stock owned (directly or indirectly) by 5 or fewer individuals. The definitions for the terms "directly or indirectly" and "individual" are in Publication 542, Corporations. Generally, closely held corporations are subject to additional limitations in the tax treatment of items such as passive activity losses, at-risk rules, and compensation paid to a corporate officers. A personal holding company is defined in Internal Revenue Code section 542. Basically, a corporation is a personal holding company if both of the following requirements are met: * Personal Holding Company Income Test. At least 60% of the corporation's adjusted ordinary gross income for the tax year is from dividends, interest, rent, and royalties. * Stock Ownership Requirement. At any time during the last half of the tax year, more than 50% in value of the corporation's outstanding stock is owned, directly or indirectly, by 5 or fewer individuals. http://www.pro1040.com/personal_holding_company_tax.htm ------------------------------ You are quite good though my friend. I will have to send you an email should my investments work out and I need some avoidance advice :). The Roth IRA coupled with a loan based on assets was ingenious. I need to go back and bookmark that thread. Berkshire also benefits from the DRD. Dividends Received Deduction - DRD If a company owns less than 20% of another company, it is able to deduct 70% of the dividends it receives. If the company owns more than 20% but less than 80% of the company paying the dividend, it is able to deduct 80% of the dividend received. If it owns more than 80% of the dividend-paying company, it is allowed to deduct 100% of the dividends it receives.

I agree with this, and am happy that we are a small niche. I would hate to live in a world run by and populated with value investors. YHOO has a history of destroying value, and INMO that will continue. They will calculate those asset values while all of their moats both here and abroad continue to be attacked. Value is great, but in Tech you cant sit on it. Either way inmo the acquisition would not have helped YHOO or MSFT inmo, Bing seems to be doing well enough but I think the search game is lost unless Google screws up over privacy or something. The real value is in the OS and Office. I actually liked Windows Mobile and cant wait to get rid of my Blackberry for Windows 7 Mobile. With that said I would prefer for MSFT to muscle in and take over stable business vs. trying to grow their own. It just hasnt worked very well and when it does (XBox) nothing drops to the bottom line.

If Jerry Yang wasnt an idiot. You wouldnt be saying that.

I was for a payroll tax holiday a few months ago. Now I am against it. LOL The right will simply look to lock in these "tax cuts" next year. They will push SSI to its breaking point, in an attempt to get rid of it. Starving it of contributions makes sense. Also its been pounded into my head that this is structural. Stimulus will help but we had a bubble economy and many of those service jobs arent coming back. The consumer is tapped out, businesses will not hire until AD raises. I would prefer long term strategic investment vs. temporary permanent tax cuts. You have to ask yourself, if Millionaires who comprise 2% of the population couldnt have their taxes raise, then who will ever have their taxes raised? Setup an infrastructure fund with $200 billion and lever it 10 to 1. Then fund any venture or Company infrastructure as long as it makes sense and the private sector puts up 30% Equity. Think of all the pipelines, and other assets that will be built that we need. We basically need an overhaul of our electric grid (to switch to nat gas / hybrid cars), new bridges, pipelines, roads, all sorts of stuff. Do what Siemens does. Fund all building improvements and efficiency gains as long as they pay for themselves over 10 years. Then collect the savings until repaid. If it doesnt workout levy a fine / tax on the entity. I would prefer something like that. I thought Obama was on to something. I would have at least got the Republicans to pass the Stark Treaty and repel dont ask dont tell. You have to take them to the woodshed, tax cuts for the wealthy is the only issue they really care about. Oh well. I will just enjoy my 2% payroll holiday raise, and keep investing. I need to join the base of the winning team. The Dems have cut taxes more then anyone in recent history and no one knows. You have to love the Marketing team on the right. Those are the guys I would hire.

I need a catalyst. Its too big, but Leaps would help. 2013 leaps are cheap. I also dont trust Balmer with that cash horde.

This is the crisis that wont go away :). We have had an interesting 3 weeks, with relatively tamed markets. I wonder what will push us over.

How did I miss this Gem. and Ericopoly I think you are a bit biased with regard to MSFT. Macs dont get sick or break ;D. I love the improvements -- the scrolling on the touch-pad and the zooming by moving my fingers on the screen. I have an IPhone4 and a MacBook Pro (both acquired in past 3 months). Generally, I like them -- but the bugs are starting to really irritate me. The MacBook system crashes -- I'm accustomed to better reliability. If I pay more, I expect more. Usually on a Vista system if you're getting crashes you can track it down to a faulty driver -- it's just too difficult to police all the hardware drivers out there. Apple has no excuse as their not an open hardware platform -- they are the OEM. They don't have to test Dell/HP/Acer/Toshiba configurations... only their own. With a test matrix that simple, they just have no excuse for this kind of quality control. This is a good point and something I hadnt considered. Now that Apple is gaining in popularity it will be interesting to see what happens when people start writing viruses for it. How is switching OSs, and what caused you to switch, given your familiarity with Windows? I like the Idea of it, but get everything I need out of Windows. I am dual booting with Linux Mint in a few days on my new laptop just to give it a whirl. It should be interesting. I think Apple has a nice sweet spot. The true nerds who bug people and point out flaws / stress test applications are on Linux or are bitching about Windows. The masses get confused and usually screw up their own system and then blame Windows, and Apple picks up the best share of customers. Hip, Cool, Early Adopters, and the Johnny come lately friends of theirs. These customers either are power users for relatively few apps (media typically), or dont use it for much but surfing the web. The general quirks either are unnoticed or overlooked due to the cool factor. I cant believe you worked on IE. It annoys the hell out of me, every time I open it. Firefox is just so much better, I never had any stability issues out of it over the past 10 years or so, it was more the lack of features which caused the switch. Thanks for the detail regarding your previous gig. Did any of the work translate to investments, like do you stress test investments in a similar process? Also did you ever own MSFT stock? I have worked for a company over the last 3 years that I think is fairly overvalued, I have to stop myself from pointing it out to coworkers when they talk about the stock movements. What are you guys doing still using Vista?

How did I miss this Gem. and Ericopoly I think you are a bit biased with regard to MSFT. Macs dont get sick or break ;D.

Stiglitz is probably my favorite Economist. Einhorn on his positions. (I own Ensco and have for a few years). http://www.gurufocus.com/news.php?id=116172 Stiglitz and Einhorn on the Economy http://www.gurufocus.com/news.php?id=116183 Einhorn on a few different things http://www.gurufocus.com/news.php?id=116130 ----------- Einhorn and Jim Grant with both be on Charlie Rose later this week. I will link when those interviews go Live. Grant will be talking about Gold, not sure what Einhorn is talking about.

Another day another cave. Oh well. Now the right can go back to complaining about the deficit and unpaid for bills (that is excluding this bill ;)). The beast will be starved.

Thanks for the link. I will have to check them out in Jan when things slow down. Still working on Q3 updates.

Here is info on the BCIS situation. I would contact Geoff if I had more serious questions. http://www.gurufocus.com/news.php?id=108454 I think you know the answer to your question. As in most things in life, money talks. Start buying shares / contacting big holders. I believe more than 50% of people have to agree, but thats just my guess.

Thanks - misterstockwell all these personal experiences help. Honestly I really like what the Cornwall capital guys did in The Big Short. I have just enough capital to began where they started but couldn't put 30% in one single option idea. I have about 10% though in a few ideas. I am hoping things continue to work out. I would love to run a $1 - $10 million dollar portfolio without having to answer to anyone.

No prob.