PlanMaestro

The average U.K. pension plan now holds just 38.5% of its assets in equities, down from 61.1 in 2006. http://farm9.staticflickr.com/8206/8231607090_e2142a82d7.jpg Screen shot 2012-11-29 at 8.18.25 PM by PlanMaestro, on Flickr

Yep.

Argentina: watch out for a devaluation. http://blogs.ft.com/beyond-brics/2013/01/22/argentina-watch-out-for-a-devaluation/#axzz2IsUfVpfg

Yes, the Japanese banking mess was larger, and slower to clean. http://variantperceptions.wordpress.com/2010/11/28/holding-banking-doomsayers-accountable/ And on and a per worker basis, that accounts for the demographic shift, Japan didn't do that badly in the 2000s. http://variantperceptions.wordpress.com/2010/11/28/two-more-japan-charts/

http://www.bloomberg.com/video/what-s-alpha-star-david-tepper-s-winning-strategy-XGkNGSi1RdCe3C3FSdhJmQ.html http://www.bloomberg.com/video/david-tepper-is-bullish-on-the-markets-gbAbgiiiTyqf7RBdLJWh7w.html http://www.bloomberg.com/video/tepper-biggest-mistake-was-russia-in-1998-I8eyDHNtT_y_kXJyaWfK4A.html

http://www.scientificamerican.com/podcast/episode.cfm?id=psychopathys-bright-side-kevin-dutt-12-12-28 http://www.scientificamerican.com/podcast/episode.cfm?id=psychopathys-bright-side-kevin-dutt-12-12-29

Automakers strain suppliers with surge in U.S. models http://www.autonews.com/article/20130119/OEM10/301199999#ixzz2IRLRmyzJ Auto parts suppliers cut thousands of workers and closed factories during the industry's collapse, and the survivors are stretched after three years of at least 10 percent U.S. vehicle-sales increases. Scarred by the recession, many are cautious about adding engineering or manufacturing capacity. Adding to the pressure, new models introductions may rise to 74 next year, compared with 40 in a typical year, Schuster said. "I get a sense that a number of companies have panicked a little a bit, and they're pushing product into the marketplace just a little bit too early," said Dennis DesRosier, president of DesRosiers Automotive Consultants in Richmond Hill, Ontario. Since accelerating production can lead to defects, he called this month's Detroit auto show the "riskiest" he has seen.

C, not much has changed from what we have discussed in the other threads: http://www.cornerofberkshireandfairfax.ca/forum/general-discussion/paulson-files-13d-on-hig/ http://www.cornerofberkshireandfairfax.ca/forum/general-discussion/hig-warrants/ Only that the divestment plan was a success, with HIG becoming more of a P&C company, a very good P&C company. The Life parts that remain are also the most complicated, the ones they could not sell: (1) Japan: on schedule w/o causing too many headaches. With interest rates almost at 0 most of the headwind has stabilized and any depreciation of the yen (JEast?) or increase in interest rates is to their benefit. (2) US variable annuities: the US has not turned Japanese and it seems that interest rates will have to rise in a reasonable horizon. Also after studying this issue in depth I was surprised by how well the hedging programs of American firms performed in 2008. After reading the statutory reports, also I think they are very well capitalized, probably the best in decades. As said before, I don't like the CEO as much as I like Moynihan, Benmosche and Marchionne. He seems more of a bureaucrat and doesn't have the passion and knowledge of the business as these other guys.

Interesting, so it works live a covered call (and that is precisely what I need). On the negative side it would use margin account. Would that work w/ Interactive Brokers? Maybe it's time that I move there and leave the old school way of doing things.

I was thinking Wellcare and Wellpoint, but the whole sector looks cheap.

http://www.ft.com/cms/s/0/1b0f01b2-60c9-11e2-a31a-00144feab49a.html#ixzz2IHaJX9iI UnitedHealth, the biggest US health insurer by revenues, said on Thursday that it expects to increase earnings next year in spite of changes associated with President Barack Obama’s healthcare law. Health insurers have been anxious about the rollout of the law, which will be fully in place by 2014, due to increased taxes, uncertainty associated with state insurance exchanges and regulations on how sharply they can increase prices. Stephen Hemsley, chief executive of UnitedHealth, said on a conference call with analysts that at this point there have been few problems associated with the law, which was passed in the face of fierce opposition in 2010, and that the new regulations might not be as bad as some have feared. “There is certainly a great deal more to work through and significant unknowns but so far, it has been manageable,” Mr Hemsley said. “In the end, the ACA [Affordable Care Act] expands an enormous national healthcare market that will be served by the private sector.”

http://www.latimes.com/business/realestate/la-fi-home-prices-20130116,0,3877030.story Nationally, CoreLogic reported that home prices were on a sharp upward trajectory in November, with almost all states posting gains that month. The firm's home price index report, also released Tuesday, showed that home prices nationwide increased 7.4% year-over-year. Los Angeles Times: Home sales picking up (video.)

https://www.bcgperspectives.com/content/articles/globalization_growth_introducing_the_2013_bcg_global_challengers/ The Latin American list looks about right, but they are expensive. Can somebody comment on the others?

VW’s Mexican Motors Lead Push to Narrow U.S. Gap With GM http://www.bloomberg.com/news/2013-01-15/vw-s-mexican-motors-lead-push-to-narrow-u-s-gap-with-gm.html The facility, which will supply VW’s two North American assembly plants with as many as 330,000 engines a year, marks the Wolfsburg-based manufacturer’s 100th production site and helps make it the most global carmaker in the world. VW this year will have 77 percent of its production capacity outside its home country, nipping past General Motors Co. (GM)’s 76 percent and ahead of Toyota Motor Corp.’s 59 percent, according to consultancy Oliver Wyman. The fact that the plant was opened in North America underscores VW’s ambition to take on GM more directly in the Detroit-based automaker’s home market. The German manufacturer plans to spend $5 billion over the next three years to expand in the region. Growth there is critical for VW to offset a demand decline in Europe that threatens to halt its progress. […] The new face of VW in North America is the pragmatic Passat. (PSAT) The mid-sized sedan, built in a new $1 billion factory in Tennessee, is bigger and cheaper than the European version. The Passat and the Mexican-made Jetta combined to account for two-thirds of VW sales in the U.S. in 2012, the first full year for the U.S.-made sedan. […] VW’s push into the mass market will take another step when it rolls out a production version of the Crossblue concept, which drew a crowd of 25 TV and video crews at its Detroit debut. The seven-seater would challenge the Ford Explorer, Chrysler Group LLC’s Jeep Grand Cherokee and Toyota (7203)’s Highlander as a sportier family-car alternative to a minivan. SUV sales account for 29 percent of the U.S. market, the biggest segment after sedans. VW forecasts SUV demand to grow more than 20 percent by 2018, outpacing all other niches. In addition to the Crossblue, VW premiered the Taigun compact concept at the Sao Paulo Motor Show in October. The two models would double VW’s SUV lineup, which currently consists of the upscale Touareg and the smaller Tiguan. To check VW’s American growth plans, GM will introduce 13 new Chevrolet models in the U.S. this year and will refresh 70 percent of its U.S. lineup over a year and a half, including the full-sized Impala sedan and the Corvette sports car. GM intends to grow faster than competitors in the U.S. after its market share hit an 88-year low in 2012.

Crisis has accelerated VW’s domination http://www.ft.com/intl/cms/s/0/10ede0a8-5a58-11e2-a02e-00144feab49a.html#axzz2HeGkstUR Volkswagen is sending an unmistakable statement of intent to other volume carmakers by embarking on a three-year, €50bn plan for new products, plant and equipment. Its Europe-based competitors are incapable of such large investments over so short a spell of time. Several are deep in the red, losing market share, closing factories and laying off workers. As for non-European rivals, such as Hyundai Motor , they have made impressive strides in Europe since the 2008 financial crisis. But they still trail VW by a distance. With its new investments, the German group wants to exploit its advantage so ruthlessly that its supremacy will be unassailable for many years. From 2005 to 2012 VW’s market share in Europe rose from 18 to 24 per cent. Such growth rates imply that by 2020 roughly one in three cars sold in Europe could be a VW marque. Rival manufacturers are well aware this is no fantasy. In a survey issued this week by KPMG, the advisory services group, 81 per cent of car industry executives expected VW to gain world market share over the next five years. It was the third successive year that the German carmaker had headed the list.

Bravo.

Then Rick Guerin pretty much disappeared off the map. I've met Rick recently, but he disappeared off the map, so I asked Warren, are you in touch with Rick, and what happened to Rick? And Warren said, yes, he's very much in touch with him. And he said, Charlie and I always knew that you would become incredibly wealthy. And he said, we were not in a hurry to get wealthy; we knew it would happen. He said, Rick was just as smart as us, but he was in a hurry. And so actually what happened -- some of this is public -- was that in the '73, '74 downturn, Rick was levered with margin loans. And the stock market went down almost 70% in those two years, and so he got margin calls out the yin-yang, and he sold his Berkshire stock to Warren. Warren actually said, I bought Rick's Berkshire stock at under $40 apiece, and so Rick was forced to sell shares at ... $40 apiece because he was levered.

If Ackman suffers, it would be interesting to see what happens to JCP. (down 3% today.) 2010: buy what the government was selling. 2011: buy what Berkowitz was selling. 2012: buy what Paulson was selling. 2013: buy what Ackman is selling?

Good comment Kraven. A good practice is to be skeptical when you're told exactly what you want to hear. And that happens well too often in one-on-ones with management. A good practice in those situations might be to talk very little, question a lot, and set traps. It might be even better to avoid talking to management all together. Instead, conference calls and presentations make easier to detect manipulative behavior that has to adjust to the average investor … so it becomes more obvious for the non-average investor.

2012 tally: The big stars and stumblers http://www.autonews.com/apps/pbcs.dll/article?AID=/20130107/RETAIL01/301079965/2012-tally-the-big-stars-and-stumblers

http://online.wsj.com/article/SB10001424127887323874204578222223240463226.html?mod=googlenews_wsj The banks and the OCC would like to wrap up a pact as soon as this weekend, these people said, ahead of the release of 2012 results starting next week. The terms under discussion would have 14 large banks pay a total of $3.75 billion in cash and the balance in other forms of borrower relief, these people said. It is unclear why the Fed has yet to sign off on the deal, which would potentially compensate borrowers who went through foreclosures in 2009 and 2010. The Fed declined to comment. The Fed and the OCC have disagreed about exactly how payments to consumers under the settlement would be determined, said two people familiar with the talks. Two members of Congress on Friday urged regulators not to rush into a deal. A person familiar with the negotiations said the deal was also facing opposition from smaller banks that say the terms favor larger lenders, which could face billions of dollars in costs if a deal doesn't take place. In a letter sent Friday to Fed Chairman Ben Bernanke and Comptroller of the Currency Thomas Curry, Rep. Darrell Issa (R., Calif.) and Elijah Cummings (D., Md.) called on regulators to hold off on the settlement.

Hey, something else might (might) be cheaper.

Any options or pair trade experts trying to take advantage of the almost no time value for the warrants willing to give some advice? The warrants have been on a tear but willing to explore alternatives instead of just selling.

Johnson & Johnson set to ship TB medicine http://www.ft.com/intl/cms/s/0/d8c79868-5502-11e2-a220-00144feab49a.html#axzz2H1Tuma6X High quality global journalism requires investment. Please share this article with others using the link below, do not cut & paste the article. See our Ts&Cs and Copyright Policy for more detail. Email [email protected] to buy additional rights. http://www.ft.com/cms/s/0/d8c79868-5502-11e2-a220-00144feab49a.html#ixzz2H1y1GzAe The move marks an important breakthrough against one of the world’s leading killer infectious diseases, which continues to pose a threat in developed as well as developing countries with nearly 9m new cases and 1.4m deaths each year. The drug, which is called bedaquiline and will be sold under the brand name Sirturo, has been approved for use with the US for “salvage” treatment of multi-drug resistant TB in combination with other medicines. Clinical trials showed it could both cure and reduce the period during which patients are infectious and need to be held in isolation in hospitals. That could help provide a financial boost for Johnson & Johnson, which was granted a rare “priority review voucher” by US regulators as an incentive for developing a tropical disease treatment. This allows it to seek accelerated approval of any other of its experimental medicines, potentially adding six months to the life of the patent.

How many shares should you own? by Chris Dillow http://www.investorschronicle.co.uk/2012/03/19/comment/chris-dillow/how-many-shares-should-you-own-QxHIjtztdkvdyX5SXTklcM/article.html My table summarizes the maths for three different types of portfolio. One is a portfolio of blue-chips, comprising stocks with a tracking error of 20 and a correlation of relative returns of 0.3. I've chosen a positive correlation because defensive stocks are likely to mostly under-perform in good times and out-perform in good. The second is a value portfolio with stocks on a tracking error of 30 and correlation of 0.1. The third is a speculative portfolio of stocks with a tracking error of 60 and zero correlation. I've chosen zero because the chances of (say) a small oil company striking oil should be unrelated to the chances of another small company winning a big order or being taken over. Calculating a portfolio's tracking error No of stocks "Blue chip" "Speculative" "Value" 1 20.0 60.0 30.0 5 13.3 26.8 15.9 10 12.2 19.0 13.1 20 11.6 13.4 11.4 30 11.4 11.0 10.8 40 11.3 9.5 10.5 You can see that, in all cases, the portfolios' tracking error falls sharply as we move from one to 10 stocks, but falls less sharply thereafter. You can also see that a portfolio of 20 uncorrelated speculative stocks has about the same tracking error as five defensives which are slightly correlated with each other.