If you watch any news programs at all, you will see how the news media wants to destroy the Clinton family Non-Profit Foundation. if Hillary becomes president (and even want her to Do It Now). As the Clinton's do not get any monetary benefit from the foundation, the cause is to destroy any emotional benefit the Clinton's get from guiding a Non-Profit Foundation in their name.
The news media seems unconcerned about Donald Trump becoming president and not doing anything to separate him from his For-Profit Business Operations. Does the news media really believe there are no conflicts of interest for a president owning far flung business operations while he is president? Is it really all right for a president operating far flung for-profit business operations while president but not all right for the president being associated with a Non-Profit Foundation? I find this to be weird. I think our country has its priorities all screwed up.* Even if such a president doesn't do things to favor his companies, do we really want a part-time president?
Let's say that the news media becomes concerned about Trump's business operations after all and would Trump's business operations be put in a "blind trust." Is a blind trust with his family running it really all right? Perhaps, but the news media doesn't like the idea of Chelsea Clinton, Hillary's daughter, remaining on the board of their Non-Profit Foundation.
Some suggest that the Clinton Foundation be folded into another Foundation like the Gates Foundation. Well The Oracle of Omaha, Warren Buffet, has done the equivalent of this and donated billions of dollars to the Gates Foundation. So their is some justification for doing it. But I believe he sits on the board of the Gates Foundation. I'm not sure the Gate's would like to have Bill Clinton on their board, but maybe it could be worked out. Would this give the Clintons the same emotional rewards? Would this satisfy the news media?
An update after writing the above. It seems like the Clintons are in the process of folding up their foundation, or most of it. The Gates Foundation won't take it because the Clinton Foundation is a active foundation, i.e. they actually distribute medications (e.g. AIDS and diarrhea) and things whereas the Gates foundation is a grants (pass-trough) foundation.
* http://stopcontinentaldrift.blogspot.com/2012/09/what-does-this-mean.html
Showing posts with label Warren buffet. Show all posts
Showing posts with label Warren buffet. Show all posts
Monday, August 29, 2016
Monday, September 14, 2015
STOCK BUYBACKS
I do not like stock buybacks, but I have bought one of the ETF that specializes in them. I think stock buybacks are a waste of money, but many companies that do them seem to do quite well I think it is earning that count and not Price to earnings. A recent article on CNBC, however, agrees that buying back stock is an iffy situation.
According to Goldman Sachs, stock buybacks will surge by 18 percent in 2015, exceeding $600 billion and accounting for nearly 30 percent of total cash spending.*
......................................................
Of the four exchange-traded funds that focus on companies that heavily buy back their shares, two have beaten the S&P 500 stock index in recent years, and two have trailed it.
.....................................................
Companies that have executed the 25 biggest buybacks since the end of 2011 have risen 21 percent since, according to a CNBC.com analysis. (We assumed investors bought 100 shares of each company announcing a buyback at the closing price on the day of the announcement). That compares to 53 percent for the broader market. Of the 25 buyback stocks, just 11 have beaten the market since the repurchases were disclosed, and many have benefited from obvious macro trends.
...................................................
Buffett said in Berkshire Hathaway's 2012 shareholder letter. "But never forget: In repurchase decisions, price is all-important. Value is destroyed when purchases are made above intrinsic value."
http://www.cnbc.com/2015/09/08/ybacks-are-killing-economic-growth.html
According to Goldman Sachs, stock buybacks will surge by 18 percent in 2015, exceeding $600 billion and accounting for nearly 30 percent of total cash spending.*
......................................................
Of the four exchange-traded funds that focus on companies that heavily buy back their shares, two have beaten the S&P 500 stock index in recent years, and two have trailed it.
.....................................................
Companies that have executed the 25 biggest buybacks since the end of 2011 have risen 21 percent since, according to a CNBC.com analysis. (We assumed investors bought 100 shares of each company announcing a buyback at the closing price on the day of the announcement). That compares to 53 percent for the broader market. Of the 25 buyback stocks, just 11 have beaten the market since the repurchases were disclosed, and many have benefited from obvious macro trends.
...................................................
Buffett said in Berkshire Hathaway's 2012 shareholder letter. "But never forget: In repurchase decisions, price is all-important. Value is destroyed when purchases are made above intrinsic value."
http://www.cnbc.com/2015/09/08/ybacks-are-killing-economic-growth.html
Sunday, September 28, 2014
THE RICH HAVE WON THE CLASS WAR*
The title of this piece is the famous Warren Buffet line given in 2011.* A recent article shows just how dramatic winning the class war has been.**
The figure is the result of a study by Paulina Tcherneva .
An examination of average income growth [in the U.S.] during every postwar expansion (from trough to peak) and its distribution between the wealthiest 10% and bottom 90% of households reveals that income growth becomes more inequitably distributed with every subsequent expansion during the entire postwar period. ***
Though Reaganomics didn't initiate the war by the rich, you will note the unusually large drop in 1982-1990. After a small recovery for the bottom 90% during the Clinton years (coupled with a small drop by the rich), there is another huge drop in 2001-2007 during the Bush-43 years followed by yet another large drop during and since the Great Recession. It must be said that some of the rich are beginning to be concerned about income disparity.
Obama has gotten though some tax reforms (e.g. increasing the top level back to where it was under Clinton.), but I don't know the effect yet.
By the way, the upper 10% in 2012 began at $77,500!****
* Warren buffet, CNN September 30, 2011: http://money.cnn.com/video/news/2011/09/30/n_buffett_class_warfare.cnnmoney/
** http://www.washingtonpost.com/blogs/wonkblog/wp/2014/09/25/this-depressing-chart-shows-that-the-rich-arent-just-grabbing-a-bigger-slice-of-the-income-pie-theyre-taking-all-of-it/?wpisrc=nl-wonkbk&wpmm=1
*** Tcherneva, Pavlina R., Reorienting Fiscal Policy: A Critical Assessment of Fiscal Fine-Tuning (August 1, 2013). Levy Economics Institute Working Paper No. 772. Available at SSRN: http://ssrn.com/abstract=2318045 or http://dx.doi.org/10.2139/ssrn.2318045
**** http://en.wikipedia.org/wiki/Affluence_in_the_United_States
The figure is the result of a study by Paulina Tcherneva .
An examination of average income growth [in the U.S.] during every postwar expansion (from trough to peak) and its distribution between the wealthiest 10% and bottom 90% of households reveals that income growth becomes more inequitably distributed with every subsequent expansion during the entire postwar period. ***
Though Reaganomics didn't initiate the war by the rich, you will note the unusually large drop in 1982-1990. After a small recovery for the bottom 90% during the Clinton years (coupled with a small drop by the rich), there is another huge drop in 2001-2007 during the Bush-43 years followed by yet another large drop during and since the Great Recession. It must be said that some of the rich are beginning to be concerned about income disparity.
Obama has gotten though some tax reforms (e.g. increasing the top level back to where it was under Clinton.), but I don't know the effect yet.
By the way, the upper 10% in 2012 began at $77,500!****
* Warren buffet, CNN September 30, 2011: http://money.cnn.com/video/news/2011/09/30/n_buffett_class_warfare.cnnmoney/
** http://www.washingtonpost.com/blogs/wonkblog/wp/2014/09/25/this-depressing-chart-shows-that-the-rich-arent-just-grabbing-a-bigger-slice-of-the-income-pie-theyre-taking-all-of-it/?wpisrc=nl-wonkbk&wpmm=1
*** Tcherneva, Pavlina R., Reorienting Fiscal Policy: A Critical Assessment of Fiscal Fine-Tuning (August 1, 2013). Levy Economics Institute Working Paper No. 772. Available at SSRN: http://ssrn.com/abstract=2318045 or http://dx.doi.org/10.2139/ssrn.2318045
**** http://en.wikipedia.org/wiki/Affluence_in_the_United_States
Monday, October 21, 2013
PRESIDENTIAL MANAGERIAL STYLES
It is pretty clear that politicians don't like Obama's managerial style. I'm amazed they don't seem to know what it is. His management style is what I imagine that of Warren Buffet's is. Buffet buys good companies and keeps the management in place and let's them continue to run their companies. So if Obama is the CEO of a conglomerate (sounds reasonable), he lets his CEOs run the ball. In this case it is Senator Harry Reid, leader of the Senate, and Representative Nancy Pelosi, now minority leader of the House. He let them run the ball on what is called Obamacare (actually the PPACA), it was the same with Dodd-Frank, and also with the recent government shutdown and near disaster of the debt limit. I haven't followed other victories as closely so I don't know how much they were involved in getting of other successes such as of "Don't Ask, Don't Tell."
Though the PPACA is much more conservative than I like, it is a beginning
The problem with this managerial style with politicians is that they all have egos that won't quit. They all think they are God's gift to humanity. They all want to talk to the Big Boss and are frustrated when they have to settle for talking to their CEOs. This is true of Democrats of the President's party as well as the opposition Republicans. And it is also true of the media. Somehow the media can't get enough access though it seems to me they have a lot. At least after the fact, they like the former President Bill Clinton style better (My memory is that when he was president, the Republicans did everything in their power to screw him.). The glad handing, good ol' boy, type of politician. The thoughtful, introspective type of politician is not as much fun.
The Republicans rolled him so often because he is by nature a compromiser, but finally he caught on and said, "No more!" He didn't realize for a long time that the current crew that controls the House, in particular, views compromise as a sign of weakness.
Though the PPACA is much more conservative than I like, it is a beginning
The problem with this managerial style with politicians is that they all have egos that won't quit. They all think they are God's gift to humanity. They all want to talk to the Big Boss and are frustrated when they have to settle for talking to their CEOs. This is true of Democrats of the President's party as well as the opposition Republicans. And it is also true of the media. Somehow the media can't get enough access though it seems to me they have a lot. At least after the fact, they like the former President Bill Clinton style better (My memory is that when he was president, the Republicans did everything in their power to screw him.). The glad handing, good ol' boy, type of politician. The thoughtful, introspective type of politician is not as much fun.
The Republicans rolled him so often because he is by nature a compromiser, but finally he caught on and said, "No more!" He didn't realize for a long time that the current crew that controls the House, in particular, views compromise as a sign of weakness.
Friday, December 7, 2012
SMALL BUSINESS CONTROVERSY
One frequently hears certain politicians talk about how restoring the temporary tax cuts,on even the wealthest 2% of tax payers earning over $250,000 would hurt small businesses, the main job creators. It is well known now that about 97% of small businesses earn less than $250,000/yr. A rather detailed consideration of this number is given by the Center On Budget and Policy Priorities* that yields an even somewhat small percentage, perhaps 1.9%.
The Federal government definition of a small business is complex, but is usually given as 500 employees. For investment purposes, a monetary limit is usally adopted, say $2 billion. An interesting discussion of the problem is given by Ruth Marcus in the NY Times.** Some parts of this article are given in italics follow:
....the economic drag of higher rates on the wealthiest taxpayers is far less than the impact on the middle class. The Congressional Budget Office estimates that raising top tax brackets would lower growth next year by one-tenth of a percentage point, compared to a 1.3-percentage-point hit if middle-class taxes rose.
....according to the Center on Budget and Policy Priorities,* 237 of the wealthiest 400 taxpayers, with incomes averaging more than $200 million, would be considered small-business owners. So would President Obama, because he receives book royalties.
...............................................................................
Rather, it sweeps in all taxpayers with business income, no matter how small a share of earnings, along with lawyers or hedge fund managers whose firms are organized as partnerships.
These upper-bracket “small businesses” are not making hiring decisions based on tax rates. Most don’t employ anyone. According to the Treasury Department, less than 6 percent of income to taxpayers in the top two brackets went to small businesses that employ people.
Warren Buffet recently said that the top 100 earners in the U.S. would be unaffected by the increase in marginal tax rates. This is so because of income tax deductions or loopholes. Nonetheless, raising the top two brackets from 33% and 35% to 36% and 39.6% is estimated to yield $493 billion over 10 years.*** This sum would constiture about 12% of the $4 trillion austerity budget needed to return Federal deficit to 2011 values.
If you haven't read the Buffet op-ed article, you should: http://www.nytimes.com/2012/11/26/opinion/buffett-a-minimum-tax-for-the-wealthy.html.
* http://www.cbpp.org/cms/index.cfm?fa=view&id=2697
** http://www.washingtonpost.com/opinions/ruth-marcus-the-shifting-line-on-tax-cuts/2012/12/04/e50bd63e-3e46-11e2-ae43-cf491b837f7b_story.html?wpisrc=nl_opinions
***http://crfb.org/sites/default/files/Raising_Revenue_from_Higher_Earners_11_15-2_1.pdf
The Federal government definition of a small business is complex, but is usually given as 500 employees. For investment purposes, a monetary limit is usally adopted, say $2 billion. An interesting discussion of the problem is given by Ruth Marcus in the NY Times.** Some parts of this article are given in italics follow:
....the economic drag of higher rates on the wealthiest taxpayers is far less than the impact on the middle class. The Congressional Budget Office estimates that raising top tax brackets would lower growth next year by one-tenth of a percentage point, compared to a 1.3-percentage-point hit if middle-class taxes rose.
....according to the Center on Budget and Policy Priorities,* 237 of the wealthiest 400 taxpayers, with incomes averaging more than $200 million, would be considered small-business owners. So would President Obama, because he receives book royalties.
...............................................................................
Rather, it sweeps in all taxpayers with business income, no matter how small a share of earnings, along with lawyers or hedge fund managers whose firms are organized as partnerships.
These upper-bracket “small businesses” are not making hiring decisions based on tax rates. Most don’t employ anyone. According to the Treasury Department, less than 6 percent of income to taxpayers in the top two brackets went to small businesses that employ people.
Warren Buffet recently said that the top 100 earners in the U.S. would be unaffected by the increase in marginal tax rates. This is so because of income tax deductions or loopholes. Nonetheless, raising the top two brackets from 33% and 35% to 36% and 39.6% is estimated to yield $493 billion over 10 years.*** This sum would constiture about 12% of the $4 trillion austerity budget needed to return Federal deficit to 2011 values.
If you haven't read the Buffet op-ed article, you should: http://www.nytimes.com/2012/11/26/opinion/buffett-a-minimum-tax-for-the-wealthy.html.
* http://www.cbpp.org/cms/index.cfm?fa=view&id=2697
** http://www.washingtonpost.com/opinions/ruth-marcus-the-shifting-line-on-tax-cuts/2012/12/04/e50bd63e-3e46-11e2-ae43-cf491b837f7b_story.html?wpisrc=nl_opinions
***http://crfb.org/sites/default/files/Raising_Revenue_from_Higher_Earners_11_15-2_1.pdf
Sunday, November 18, 2012
MITT ROMNEY
My heart goes out to Mitt Romney. The effort he put in , in his failed run for the presidency, was incredible. He went through a brutal primary campaign in which he felt compelled to flip flop on socially radical stands (e.g. on abortion, global warming, and other issues), then he had to shift gears and flip flop again in which to woo "ordinary" voters in the Presidential election. I think what he was saying was, "Just elect me as President and I'll fix it."
Romney was a good student in law school and outstanding in simultaneously pursuing an MBA, saved the Winter Olympics (and gave his salary to charity), and got passed an incredible health plan as Governor of Massachusetts (Where he refused the salary.). He gave away his inheritance to BYU for the George W. Romney School of Business Management. He did an outstanding job in his missionary work to France. He tithed to the Mormon Church in which he also became an official, and was very successful at making money in business. Early in his tenure at Bain Capital he started out in venture capital (i.e., creating startups) and was very successful at that, even creating quite a few jobs, but switched to private equity where making money was easier. The guy had seemingly never failed at anything in his life until he was defeated at the age of 47 by popular Senator Ted Kennedy in a Senate bid, but he was undeterred in pursuing a political career. It is worth noting that, though very wealthy, he gave up his pursuit of money to enter politics. In doing so he never came close to such financial leaders as Bill Gates and the Oracle of Omaha, Warren Buffet. In fact he has never even entered the top 100 fortunes, so far.
It became clear, however, that Romney's background made him out of touch with the populace and led to such gaffs as his talk to supporters about he wouldn't get the votes of the "dependent" 47% who don't pay income taxes,* insulting many workers who vote Republican. After he was defeated for President, he has given another talk to supporters claiming that he lost because of extreme gifts given by Democrats to the less well off.* He obviously is not introspective. He not only promised to return $713 billion to Medicare that he wrongly claimed was taken from benefits, but he overlooked all the income tax gifts given to the wealthy by the government (e.g. 15% income tax rate on qualified dividends, 15% on long-term capital gains, low taxes on "carried interest," no income taxes on Municipal bonds, among other more complex gifts) that permit him to pay less than a 15% income tax rate in many years rather than the 35% he would have paid without loop holes. He even promised to extend tax breaks for the wealthiest Americans.
Also see: http://en.wikipedia.org/wiki/Mitt_Romney; http://stopcontinentaldrift.blogspot.com/2011/07/republican-presidential-candidates-for.html; and http://stopcontinentaldrift.blogspot.com/2011/12/tthe-republican-primaries.html
* http://www.marketplace.org/topics/elections/campaign-trail/numbers-behind-mitt-romneys-47-comment; http://www.latimes.com/news/politics/la-pn-mitt-romney-obama-gifts-20121115,0,2129448.story
Romney was a good student in law school and outstanding in simultaneously pursuing an MBA, saved the Winter Olympics (and gave his salary to charity), and got passed an incredible health plan as Governor of Massachusetts (Where he refused the salary.). He gave away his inheritance to BYU for the George W. Romney School of Business Management. He did an outstanding job in his missionary work to France. He tithed to the Mormon Church in which he also became an official, and was very successful at making money in business. Early in his tenure at Bain Capital he started out in venture capital (i.e., creating startups) and was very successful at that, even creating quite a few jobs, but switched to private equity where making money was easier. The guy had seemingly never failed at anything in his life until he was defeated at the age of 47 by popular Senator Ted Kennedy in a Senate bid, but he was undeterred in pursuing a political career. It is worth noting that, though very wealthy, he gave up his pursuit of money to enter politics. In doing so he never came close to such financial leaders as Bill Gates and the Oracle of Omaha, Warren Buffet. In fact he has never even entered the top 100 fortunes, so far.
It became clear, however, that Romney's background made him out of touch with the populace and led to such gaffs as his talk to supporters about he wouldn't get the votes of the "dependent" 47% who don't pay income taxes,* insulting many workers who vote Republican. After he was defeated for President, he has given another talk to supporters claiming that he lost because of extreme gifts given by Democrats to the less well off.* He obviously is not introspective. He not only promised to return $713 billion to Medicare that he wrongly claimed was taken from benefits, but he overlooked all the income tax gifts given to the wealthy by the government (e.g. 15% income tax rate on qualified dividends, 15% on long-term capital gains, low taxes on "carried interest," no income taxes on Municipal bonds, among other more complex gifts) that permit him to pay less than a 15% income tax rate in many years rather than the 35% he would have paid without loop holes. He even promised to extend tax breaks for the wealthiest Americans.
Also see: http://en.wikipedia.org/wiki/Mitt_Romney; http://stopcontinentaldrift.blogspot.com/2011/07/republican-presidential-candidates-for.html; and http://stopcontinentaldrift.blogspot.com/2011/12/tthe-republican-primaries.html
* http://www.marketplace.org/topics/elections/campaign-trail/numbers-behind-mitt-romneys-47-comment; http://www.latimes.com/news/politics/la-pn-mitt-romney-obama-gifts-20121115,0,2129448.story
Subscribe to:
Posts (Atom)
