Money Talk

Higher taxes = Higher markets? The statistics over the last 70 years appear to suggest that. The years with increases in taxes led to higher stock market returns, overall. The average return, through the end of 2019, was 9%. The years of tax hikes on personal, corporate, and capital gains achieved a higher average return between 11% to 14%. The working thesis on the corporate side is that an increase in taxes incentivizes companies to invest more in their companies, leading to better growth.

Good news comes in threes! The Oxford University/ Astra zeneca vaccine is the third one in the last few weeks which has shown positive results from phase 3 human trials, with a effectiveness rate of about 90%. This follows closely on the heels of Pfizer’s and Moderna’s RNA based vaccines which have between 90% to 95% effectiveness. The key advantage of the Oxford vaccine is that it is a traditional viral vector type that does not require special refrigeration in production a...nd distribution. It can be stored at regular refrigerator temperatures compared to the Moderna and Pfizer vaccines which require refrigeration at -20 deg C and minus 70 deg C respectively. This makes The Oxford vaccine a better candidate for developing nations which might not have the cold storage infrastructure for large scale distribution. Also being a traditional vaccine it is much cheaper and easier to produce and can could the existing vaccine manufacturing facilities that are already present in these nations. There might be a split demand globally, where the wealthier nations pay a higher premium for the few percent higher effectiveness rate whereas the resource-constrained nations go for the cheaper vaccine that is easier to produce. Having the choice and the options are going to be critical in the next phase of deployment of the vaccines, post-approval, to an eagerly waiting global population. See more

Please join us for our Zoom Market Update Webinar this evening (info below). Elections, a Government (not) transitioning and a possible COVID second wave shut down - there is never a dull moment. Please join us for our Zoom webinar on the Markets and Economy, and 5 positive developments that we are excited about. Also, we will look at the hot sectors at present and in the future. Market Update: Investing for the Next Four Years! Wednesday, November 18, 2020, 5:00 pm 5:30 pm pst Zoom ID: 875 0923 7868 https://tinyurl.com/yy9c3t2x email [email protected] for password.

Markets during Presidential cycles: In the midst of a cliff hanger in the US elections, here is the good news. o Historically, November and December have been strong months for the US markets during presidential elections o The markets have been up regardless of whether a Democrat or Republican won the election We expect there to be some short term volatility, particularly if there is a contested election. The Bush-Gore election was one cycle that was marked by market upheav...al. Several causes likely contributed to that weakness including a close race, bursting of the dotcom bubble, and rising interest rates. This time around we have COVID in the mix. The key remains to stay focused on investing for the long term and to ignore some of the election noise as the final results come in. Data source: FMR Co, Index = Mix of market indexes including Dow and S&P 500

14 Billion - the price of democracy: 14 B in spending in this election makes it the most expensive in history! A record 100 Million have voted already - that is 40% of the voting population. This is the one we will be talking about for years to come. Please go out and vote!

The 2020 US Presidential Elections are promising to be historic in many ways. For one, early voter turnout is 133% of the numbers at this time in 2016, with 8 days to go. At 64M votes cast, we are getting halfway to the historic 139M total votes in 2016. In the hotly contested states (below) Texas has a clear lead in early voting, with Wisconsin and Minnesota also well ahead in votes cast, compared to 2016. The early numbers are partly related to the Coronavirus epidemic and changes in the modes of voting. But if the markedly higher percentage of early ballots in many states is an indication of voter enthusiasm, this will be a race worth watching! Source: Washington Post. Green bars below are for numbers for 2020 to date. Grey bars are from the same time frame in 2016.

In danger of getting fired - CPAs who cannot figure out how to get their wealthy client's tax bill down to $750! Out of high-income taxpayers, only about 0.5% have paid $750 or less. Experts consider this to be an "extreme outlier". Sources: Investment Advisor, Marketwatch

At the end of 2019, the world economy was a whopping $88 Trillion. The US holds 25% of the global value. China follows at $14 T, 16% of the world economy. India has been the largest mover in recent years, in 5th place, moving ahead of UK and France. The top 10 countries account for 67% of the world's GDP. COVID is expected to reshuffle some of these numbers for 2020.

ECONOMY, MARKETS AND INVESTMENT UPDATE: TODAY TUESDAY 6TH, 5 PM-5:30 PM VIA ZOOM Friends - What a dramatic time: ELECTIONS, COVID, CHINA TRADE, SUPREME COURT NOMINATION, PRESIDENTIAL ILLNESS! And what does all this mean for the economy and investments! Come join us for a Market updates Zoom call Today October 6th at 5pm to 5:30 pm https://us02web.zoom.us/j/82788567356 We will look at 4 of the biggest questions: When will we get back to normal?... How is the economy doing? Where is it going? What do we expect in the markets through the pandemic and elections? How can we protect our investments? Join Markets Updates Zoom Call Tue Oct 6, 5 PM PST https://us02web.zoom.us/j/82788567356 Meeting ID: 827 8856 7356 One tap mobile +16699006833,,82788567356# US (San Jose) See more

If there is one thing that Wall Street does not like, it is uncertainty! In the midst of Covid, China trade issues, a supreme court nomination and the lead up to the US elections, President Trump joins the list of World leaders who have had COVID-19. Many of those countries are seeing growing incidences of the disease. Join us on Tuesday, October 6 at 5 PM Pacific time for a market updates call where we will look at the effects of some of the current issues on the markets and the economy. Source: Wsj

What Happens Every MINUTE on the Internet in 2020? Amazon ships 6000+ packages, 70,000 apply for jobs on LinkedIn, Consumers spend $1Million online, and a whopping 42 Million messages are exchanged on WhatsApp. Data never sleeps... Source: Visual Capitalist

Historically high savings rate in the US: When you think of the financial implications of COVID, the words that come to mind are Unemployment, Recession. However, the US household savings rate reached a record high in April at 33% of disposable income! The reasons for this bounty are nuanced, as are the long-term expectations for the Economy 1. With COVID, there just were not enough places for people to spend their money. With reduced driving, limited vacationing opportunit...ies, partially open restaurants and mostly closed recreational business such as movies and concerts, saving has become the forced option for many who have sources of income 2. Another aspect that has aided the saving was the government injecting large amounts of cash into the economy, in the form of grants and loans in response to the COVID related economic downturn 3. Underlying the higher savings rate is also a general wariness about the economic outlook as the pandemic stretches into its sixth month. Families are feeling the need to hunker down and add to their nest eggs to deal with uncertain times. This inevitably brings up the question how do we expect the economy to perform in the long term? The outlook for the economy is largely positive. Companies that were severely affected by the pandemic are expected to gain momentum as demand recovers. Other companies that did not see their products or services affected by COVID, have seen earnings that have mostly triumphed over lower expectations. #usa #usafinance #covid19 #panadamic #lockdown #besafeworld #finance #InvestmentManagement

Operation Warp Speed Operation Warp Speed is a publicprivate partnership, initiated by the federal government of the United States, to facilitate and accelerate the development, manufacturing, and distribution of COVID-19 vaccines, therapeutics, and diagnostics. The program has been awarding large grants to companies with promising vaccine candidates and is aiming at delivering 300 Million Doses of Vaccines by January 2021.From 2006-2015, the US spent $11 Billion on Vaccine research and distribution. For SARS CoV-19 research United States has already invested a sum of $5.6 Billion in 2020 as of May 2020. Here are the big winners of contracts from the US Government

Winners and losers 2020: We’ve seen two years worth of digital transformation in two months. - Satya Nadella, Microsoft CEO. As we get used to living almost our entire lives online, from working to attending classes to meeting friends and family, it is not surprising that information technology has been the hottest ticket in the markets this year. Consumer discretionary, while up, tells a mixed story. Even as cruise ships remain docked onshore and hotels and airplanes go e...mpty, the e-commerce market place is booming with activity with the likes of Amazon leading the pack. Healthcare is another market that hides conflicting stories. If hospitals have such high usage, why aren’t they making huge profits? Well as it turns out, treating pandemic related patients is very expensive for the hospitals. The biggest boost to their bottom lines come from surgeries. Many elective procedures have all but stopped. On the other hand, there is the vaccine and COVID treatment race which is providing the ballast in the healthcare industry. The energy sector as one of the bigger losers is no surprise. The demand for oil has fallen globally by 29%. And the outlook doesn’t seem any better short term. The other loser is financials. Banks make money when they lend money. And in an economy with reduced spending and induced liquidity, there is little demand for credit. Data in graphic through June 10, 2020 Source: Visual Capitalist See more

At some point in their lives, 8 in 10 women find themselves solely responsible for their own financial well-being. Yet despite emphasis on equality, about half the women defer to spouses on long-term financial decisions with 35% participating equally and 16% taking the lead. COVID-19 has increased the roles that women are juggling, including handling more childcare and home duties. And lockdowns have created new responsibilities, such as homeschooling. COVID Resolutions: T...he pandemicand its economic falloutalso has increased women’s financial concerns. The good news is that women are engaging more on finances 8 in 10 women want to protect themselves and their families more than before Two-thirds of women intend to have financial discussions with their spouse. Nearly 4 in 10 are considering financial reviews, portfolio discussions and updating their wills. Source: 2018 UBS study of the financial participation of US Women

The deadline for businesses to apply for the Paycheck Protection Program has been extended to August 8th (check with your bank as their dates might be earlier). The current program is more flexible than : 24 weeks of costs might be eligible for forgiveness Only 60 percent of the forgiveness amount must be used for payroll. The rest can be used for non-payroll costs (e.g., mortgage interest, rent and utilities) A longer, 5-year repayment term for any funds not forgiven Additional time for returning to pre-COVID levels of employment and exemptions

As we go through our fourth month of Covid 19 isolation, we see some parts of the economy opening up. It will probably be similar to an airplane landing in choppy weather. We will likely hit the tarmac and bounce a few times before coming to a rest. Meanwhile there are a lot of promising treatments emerging. Remdesivir is showing a 30% to 40% success in reducing the hospitalization time by stopping the virus from replicating. Dexamethasone has about a 25% to 30% success in ...reducing deaths by treating the inflammation caused by the COVID virus. Treatment with convalescent plasma has about a 30% to 60% recovery rate, with plasma from recovered patients being injected into those battling the disease. There is hope that combining these treatments can reduce the mortality rate by 60% to 70%. The above are all treatments that existed before Covid. Out of the COVID 19 specific medications, Regeneron is showing promise for treating the sickest patients.

Zoom is worth more than the 7 top airlines, combined. In the last two months!

ICO is the new IPO As more companies are raising capital via Initial Coin Offerings, some of the VCs are beginning to take notice including Sequoia. Others are feeling threatened over the new model bypassing traditional venture-capital. In an ICO, the company basically launches a new currency. It sells the tokens for this currency in exchange for an ownership stake. These tokens are then used to fund the operations of the company. While there are regulatory hurdles, many of the companies raising capital via coin offerings are over funded indicating that the trend raising capital via Crypto Currencies is here to stay for now. Wall Street Journal article on ICO Questions: td at vedafunds.com

The coal industry is seeing a revival of sorts - the Dow Jones Coal Index is up 44% of the year. This, after tumbling for many years in a row. But the rebound in the price of coal has less to do with Trump - and any anticipated loosening of environmental regulations - than one might think. The price of coal is paired with the price of gas, its alter ego. As the price of gas went up from $2 to $3+ per million BTU, coal recovery became more economically attractive. The majors in the industry just came out of bankruptcy, to be greeted by an uptick in pricing. Furthermore, there is the more lucrative part of the carbon business where it is an essential ingredient of steel. Australian mines suffered a natural disaster from the rains, creating a shortage in that industry, and a nice opportunity for US miners.

Who's hot Who's not: Financials are the new darling of Wall Street. In Fortune's listing of the 100 fastest growing companies, the somewhat staid banking sector is all the rage numbering 29 out of the 100. And look for profit margins to fatten as interest rates climb. Also in vogue, healthcare and technology - watch out as we all tool around in our self driving cars at 100! So who is passe? For now oil, mining (Pic courtesy of Fortune magazine)

Elections and Your Portfolio - Some "fun" facts about elections and investor behavior: o People take more risks with their portfolio when their party is in power - in other words, the euphoria people feel can translate (unadvisedly) into the way they behave... o Investors whose candidate did not win, tend to get restless and trade more often and this can lead to long term under performance of their portfolios Which political party is in power has less to do with the markets than it does with us and how we react to changes. The field of behavioral finance has been used extensively to study the impact of psychology in investment decision making. Tip: Over an election cycle, it is advisable to restrict trading to within a predetermined limit - say 5% of the overall portfolio, to avoid emotion driven investing

Some fun facts about elections and investor behavior: People take more risks with their portfolio when their party is in power in other words, the euphoria people feel can translate (unadvisedly) into the way they behave Investors whose candidate did not win, tend to get restless and trade more often and this can lead to long term under-performance of their portfolios Which political party is in power actually has less to do with the markets than it has to do with how we react to partisan changes. The field of behavioral finance has been used extensively to study the impact of psychology in investment decision making. One practical tip to avoid emotion based trading: Over an election cycle, it is advisable to restrict trading to within a predetermined limit say 5% of the overall portfolio

I will be speaking at an event of the AAII American Association of Individual Investors regarding the value of an Investment Advisor - tomorrow at 9:30 am - Toni DasGupta AAII - Los Angeles Chapter TALK: INVESTMENT ADVISOR OR NOT?... Moderator: Evan Press, President AAII Los Angeles Speaker: Toni DasGupta, CEO Veda Financial Speaker: Fred Wallace, Individual Investor Date:Saturday, November 5, 2016 Time: >> 9:30 A.M.<< Location: Culver City Veteran's Memorial Complex Garden Room

If we become increasingly humble about how little we know, we may be more eager to search. - Sir John Templeton, Investor

Honoring Irene Bergman, the woman with the longest career on Wall Street - spanning 72 years! She started her career in 1924 and her last day at the office was in 2014, when she turned 99 years old. She passed away this week at 101. A true trail blazer who managed $1B for Stralem, an asset management firm, she persevered and triumphed over discrimination and persecution in her lifetime.

The top billionaire producing undergrad institutions.

Low interest rates and high employment made it a good time to buy a home. But the other side of the coin is that home prices are on the increase up 5% since early 2015. This has put a dent in first time home buying for millennials.

"When in doubt, do nothing". So Brexit is done. Is it time to freak out? No! The talking heads declared this morning that markets are in a "free-fall". Down 3% - is that a free fall? Fact of the matter is that the markets are not really "down". They are just back to their levels of last week after some heady talk of Brexit pushed up the indexes some. Other than that a drawdown of 3% is nothing unusual - it can happen several times in a year. And volumes (stock traded) are nothing unusual - certainly far lower than back in September of 2015, when the index fell 10% in a few days. Since then it has bounced back quite nicely, and is up for the year. A screenshot of the S&P below -

The Bank of Canada became the first major financial institution to experiment with using bitcoin blockchain technology to track interbank payments. The distributed ledger system of blockchains can make transactions more open and transparent compared to existing technologies.

Leaving can be hard. Research finds that stock market returns drop 13% over the year at companies which force out their CEOs, compared to 0.5% for a planned succession.

Stocks gained today on talk of a possible interest rate hike from Fed Chairperson, Janet Yellen. There are many reasons to actually celebrate an interest rate hike. Yellen: Rate hike probably appropriate in the coming months 1. An increase in interest rates will help savers, who currently have to contend on bank CD rates sitting at less than 1% (which, of course, is a whole lot better than negative rates faced by our brethren in the EU)... 2. It helps increase inflation and yes, that can be a good thing. A higher value of the dollar can lower the prices of imported goods. But there is a flip side here as well a stronger dollar makes it harder for the rest of the world to buy our products, making the trade deficit worse 3. Banks make more money when interest rates go up and that improves access to credit for the rest of us. Banks rely on the spread between the rates that they pay you on money (CDs etc.) and the rates that they make on money they loan out (to businesses, individuals). This spread begins to look even better in an increasing interest rate environment.

We are very pleased to announce that Toni DasGupta, Investment Advisor at Veda Funds, will be speaking at the National Association for Women MBAs, Los Angeles on June 16th, at Santa Monica. She will talk about personal finance, investing, and the markets.

We love our gold - but does it make sense as an investment vehicle? The pricing of gold is largely speculative, compared to the stock prices of companies which have an inherent basis in actual valuation as a business. The common belief that the price of gold always goes up, is not borne out. The graph shows historical price trends for gold. Inflation adjusted price of gold over time it hit a high in of $2000 in 1980 and fell to a low of $400 at the end of the previous century, and now stands at $1230 per oz.

"The four most expensive words in the English language are, 'This time it's different.'" -Sir John Templeton, Renowned Investor

Something for investors in MLPs to watch out for - there might be a tax hit, even when there was no income. Besides losses and lack of distributions with oil and gas MLPs, there is also a potential of further loss if the MLP declares bankruptcy, which many are doing. Forgiveness of outstanding debt to the company qualifies as income that gets passed on to shareholders even if no distributions were received, resulting in a tax burden on top of losses from the investment.

Some people get rich studying artificial intelligence. Me, I make money studying natural stupidity Carl Icahn's Twitter bio

"Chains of habit are too light to be felt until they are too heavy to be broken." - Warren Buffett

"Money gets to be an anchor on performance" - Warren Buffett explaining why having too much money to invest can affect performance. Buffett has always maintained that he could make a 50% return a year if he had only a few million to invest. With the amount of capital to be deployed at Berkshire Hathaway, there are only about 200 stocks that he can buy, which precludes much of the small stock universe where bargains can be found.

"Know what you own, and know why you own it." - Peter Lynch - important words to remember, not just when buying, but also when re-evaluating periodically.

If something is not worth doing at all, it is not worth doing it right! Businesses would do well to find the right areas to invest in, and then go in deeply.

Investor Charles Mizrahi, author of Getting started in Value Investing, talks about the investing style of the famed John Templeton. In 1939, when Hitler and the Nazis were conquering most of Europe, stock prices were depressed, and in most cases stocks were trading for less than their scrap value. Templeton saw this as an opportunity and began buying stocks. He placed orders to buy hundreds of dollars worth of every stock trading for less than $1 per share ($17 in 2012 doll...ars).He bought the stocks of 104 companies in all, of which 34 went bankrupt. However, his total investment of $10,400 was sold four years later for more than $40,000. In 1954 he started the Templeton family of mutual funds. He loaded up on stocks that were tossed into the unloved and unwanted piles in exchanges across the globe. He didn’t let the day-to-day gyrations of the Market shake him out of his positions instead, he looked at the fundamentals of a company and bought or sold only when the stock price disconnected from the underlying lying worth of the business.

Tis the time of year - for mistletoe - and tax loss selling. It is a popular practice to sell losing stocks investments at the end of the year to offset gains in other positions. However, it is a good idea to evaluate holdings to see if there is a good long term reason for selling. Is the stock significantly overvalued? Also, the IRS looks askance at any sales, if the same stock is bought back within 30 days. And this extends to "substantially similar" transactions, such as trading in the A class shares for B class, for the same company. Or buying into the same index ETF from a different provider.

From "Superforecasting" by Professor Philip Teltock: The humility required for good judgment is not self doubt the sense that you are untalented, unintelligent or unworthy. It is intellectual humility. It is a recognition that reality is profoundly complex, that seeing things clearly is a constant struggle, when it can be done at all, and that human judgment must therefore be riddled with mistakes.

October: This is one of the particularly dangerous months to invest in stocks. Other dangerous months are July, January, September, April, November, May, March, June, December, August and February.Mark Twain

Tax deductions for Donors: Donor Advised Funds provide a way for any donor to make a charitable contribution and take a tax deduction in the current year, before even deciding which charity the money should go to. The Funds are available through brokerages and can be useful for people who believe that the timing is good to take the tax deduction, or feel that the benefit might go away in future years. There has been some talk from both sides of the political fence regarding removing this and similar benefits for charitable deductions, but it is highly unlikely there will be any changes soon.

When interest rates rise, guess who will be laughing all the way to the bank? The bank! When rates rise, banks up the interest they charge for home loans, twice as fast as the rates that they pay out to their depositors. Banks get money by selling CDs. They give out money by making loans. As rates rise, this spread also increases giving them a nice margin to play with.

"I know you think you understand what you thought I said but I'm not sure you realize that what you heard is not what I meant" words to chew on from former Fed chairman Alan Greenspan. Current chair woman Janet Yellen is anticipating a rise in interest rates by the end of the year.

The 7 point Buffett checklist for a bargain stock - a wonderful company selling at a fair price: 1. Simple Business 2. Favorable Long-Term Prospects 3. Able and Honest Management 4. Consistent Earnings... 5. Good Return on Equity 6. Little Debt 7. Very Attractive Price See more

I could end the deficit in 5 minutes. You just pass a law that says that anytime there is a deficit of more than 3% of GDP all sitting members of congress are ineligible for reelection. Warren Buffett

Dividends are popular with many investors, but some care is warranted in picking the right stocks. There are two reasons why the dividend yield of a company might be high: 1. It has great earnings and the company believes it will be better to distribute the cash to shareholders, rather than hold it back to fuel further growth 2. The company was paying a normal dividend but its price fell, making the yield (as a ratio of the share price) look abnormally high Clearly, one has t...o watch out for the latter because it might signal companies in distress and typically they will be ones also taking on a lot of debt. Besides doing the fundamental analysis, it is good idea to check the dividend payout ratio. It is best to steer clear of companies that are paying out most of their earnings, or even more than their earnings, out to shareholders (some classes like utilities can have high payout ratios and still be stable). Not only is a situation like that not sustainable in most cases, it can cause the share price to spiral down in time. See more

Notwithstanding international jitters, the US economy continues to hum along. Personal spending was up in August, as were American salaries. Consumers account for a full 2/3 of the US GDP, and related indexes are closely watched as barometers of economic health. Households have received an unexpected bonanza in savings on gasoline, with low prices, but interestingly the cash has found its way back into increased personal savings, rather than into consumption. When the Feds refrained from raising interest rates last week, they were careful to point out concerns regarding the world situation, not domestic - which seems to be chugging ahead.

More tail pipes expected to roll..... the scandal with VW running software in their cars to fool emission testing systems, has led European authorities to do "real world" testing. VW fails all standards - by a lot! The lines on the left are the standards. Incidentally, besides its own brand VW owns the luxury brands Bentley, Bugatti, Lamborghini & Porsche.

Investor Mohnish Pabrai shared some interesting projects in the works, at the Pabrai Funds annual shareholder meeting on September 12th, 2015 1. A family of ETFs in the planning stages - the quant research is being carried out by student interns 2. Exploring a new digital insurance company similar to Warren Buffett's Geico - the company will focus on business insurance Also departing from his norm of not discussing current holdings, Mohnish spoke about his investments into car companies Fiat Chrysler and GM

2016 US Investment outlook event at PAAMCO on September 23rd

With all the talk about historically low oil prices, why does it still seem like we are paying disproportionately high prices at the pump? The gas price heat map from GasBuddy shows the current gas pricing. If you think that the red blob of >$3 gas suspiciously follows the outline of California, you are spot on. In this state we did not see the price drops that others did - with a major chunk of the country paying <$2 for gas currently. A big issue seems to be with the refine...ries in California. They are running full throttle, and even so, they are barely keeping up with demand, which means prices have stayed pretty steady. The refineries have been warning for some time that come fall, they will need to go into an extended period of maintenance, so short term output might still be constrained - and hence the high prices at the pump. That is the simple explanation anyway. There have been more sinister reasons proposed for the price gap, including collusion between refineries! See more

Top 10 Chinese companies with China (Sino) in the name - 9/10. Top 10 US companies with USA in the name = 0/10. It is well worth remembering that the state has a great deal to say in the Chinese economy, and consequently in the Shanghai stock market. Last week's 3 consecutive days of devaluation of the Yuan was a reminder that regulatory risk is something to watch out for in overseas markets!

Imperfect rationality: Robert Hagstrom, writer of the classic The Warren Buffett Way, discusses the value of patience in investing. He contends that Buffett's success has less to do with IQ, and more to do with attitude. His patience in seeing investments through in the long term with almost "perfect rationality" gives him an edge. Hagstrom discusses Imperfect rationality, which can be learned, and used, in resisting the temptation of frequent trading. It is a skill which when honed, can give the same results as perfect rationality. As an example, he discusses Ulysses, who knows his own weaknesses, and has his crew tie him to the mast of his ship so he will not be tempted by the sirens!

Oil continues its slippery ride. The price per barrel has plummeted from $115 over the past year, to hovering around the $50 range. And now, the lifting of oil sanctions against Iran has triggered a whole round of speculation about the future of oil prices. The oil story has always been a push-pull between supply/demand. But over the recent past, the two have conspired to depress the price of oil. US oil wildcatters, driven by sheer desperation, started the quest to produce o...il from shales - previously thought to be too challenging. The unexpected success let to a boom time since 2008, which coupled with record production in the middle east, has led to an oil glut. Now softer demand from China has led to a double whammy. It remains to be seen if China is simply taking a breath and readjusting, or there are long term implications for its economy. Meanwhile, the consumer might very well continue to party at the pump! See more

Safety issue or red tape? Prime minister Modi wants to make India 50th in the ranking of countries in the ease of doing business - which is pretty ambitious considering it is currently ranked 142/189. The recent snafu where Nestle India recalled $50M worth of Maggi noodles for high lead levels, put the matter center stage. Is this an issue of not having consistent standards? Maggi claims that the flavor packet (which does indeed have higher than acceptable levels) should be mixed in with the noodles (which brings it within allowable levels). Nestle, a Swiss conglomerate with a 100 year history in India, will challenge the government further on this. Meanwhile, the FDA is quietly starting its own tests as US Maggi noodles are manufactured by Maggi India. It will be interesting to see where this goes.

So who is watching the fox pen - apparently a hen, and not a very diligent one at that - going by the latest twists in the Libor rigging scandal. The Libor is the interest rate that banks charge each other for borrowing. Libor plus, is what you pay to borrow money to finance your home or business. Now it turns out that the banks (aka foxes) were deliberately manipulating the Libor rate to not only make their results look better, but also to make about 0.04% more on the loans ...that they gave out to consumers! And where it gets downright strange is that when representatives of the British Bankers Association investigated this back in 2005, the banks, including JPM, Bank of America etc even indicated that they and the competition were all cooking the rates. However, the head of the BBA at the time said that he did not act on the concerns because he did not "recognize them as a serious problem". Expect more revelations and fallout from this saga! See more

Investing wisdom from Charlie Munger - You’re looking for a mispriced gamble. That’s what investing is. And you have to know enough to know whether the gamble is mispriced. That’s value investing.