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Happy New Year to You'll.
It's a good time for 2009 predictions (anything & everything) from all our bloggers out here.
Frank,
H1-B visas are bad, bad, bad. Even in good times when the economy is booming. It basically is a steaming pile for people that take the time and money to achieve a technology degree. Working at various large tech companies I do not see why it is necessary, there are plenty of out of work and graduating engineers here to fill the holes.
slumlord, I do not see why employers should be restricted to one pool of labor. Would you like to be restricted to driving American cars only? I am not comparing the quality of American engineers and American cars. I am merely stating the importance of freedom and choice.
BTW, the new Lincoln MKS looks hot.
Companies exist primarily to make a profit, not to provide jobs.
As far as 4 days a week. No word yet. I did have to take a mandatory 4 days of vacation. Which with the holidays gave me a week and a half off. There is plenty of work and we are behind on some projects so I feel it is more of a knee jerk, fear based reaction. With the company not knowing what their customers are going to do.
At our holiday party one of the higher up's mentioned something about lets hope the bailouts and stimulus packages go through, as it will be good for the company. I was appalled and said no bailouts. It bothers me that a company of this size is somewhat depending on the bailouts....
Companies should do anything that makes them money? Yes I agree as long as they obey the law.
I do not agree with companies saying there are not enough qualified engineers and that we need to bring some in. Companies are free to do what they like, I am free to say they are being disingenuous.
As far as freedom and choice. Do you believe in borders? As in companies/jobs are somewhat free to cross borders but labor/people not so much.
I do not agree with companies saying there are not enough qualified engineers and that we need to bring some in. Companies are free to do what they like, I am free to say they are being disingenuous.
To them, there are never enough qualified engineers. To us, there are never enough good jobs. To consumers, there are never enough choices.
Companies exist primarily to make a profit, not to provide jobs. Employees work primarily to make a living, not to make the shareholders rich.
See, we cannot avoid selfish motivations, we can only balance all these conflicts using a medium, such as Free Market. :)
Do you believe in borders?
I believe in borders so long as there is welfare. However, in my perfect world, there are no borders and there is no welfare. LOL!
Peter P, yes he is, how did you know LOL.
Perhaps I am psychic. :roll:
(I also know that tomorrow is a new year.)
I think we are arguing about different things.
H1-B is a law that has certain criteria. I believe from first hand experience that companies are abusing it and not using it for it's original intent. In essence they have perverted a law and are bordering if not being illegal.
As far as free markets, then a world without borders would mean the free market would be able to function better.
But I think that there are more workers than jobs, therefore being a worker bee. It would not benefit me....but that is just a supposition.
Motorola's layoff plan running ahead of schedule
According to a Reuters piece, yesterday beleaguered cell phone manufacturer Motorola announced that by the end of the quarter, which is today, the company will have laid off 400 more employees than it had originally planned. This does not reflect additional layoffs, but rather a change in schedule for the 3,000 layoffs that have been planned since October of 2008. The net result is that only 1,100 layoffs are now planned for Q1 of 2009 instead of the 1,500 that were originally slated for the quarter.
The change in schedule will result in an additional charge on Motorola's books for the Q4 period. Motorola had originally expected to rack up US$104 million in charges as a result of the layoffs in Q4, but said that it is now expecting the figure to come in somewhere around $189 million instead.
Bloomberg article says that developing nations will have to start issuing their bonds in USD.
http://www.bloomberg.com/apps/news?pid=20601109&sid=aKgtMlZgwWHo&refer=home
Would that be a positive for the value of USD or not? Seems like it ought to create higher demand for dollars, at least until they spend or exchange them again (which could have some time-delay?)
according to the article, dollar bond total was $68B, just a drop in the bucket compared to the printing of $T. We do $700B in one shot you know.
Plus, if the emerging markets are offering 12% or more for their dollar bond, that will have a lot of interest rate pressure on US T. But obviously we cannot let T rate go high, or else we will all be game over as foreclosure rate can easily go up 10x. So the Fed will print enough to suppress the T rate, which will more than negate the $68B dollar demand.
Maybe developing countries are issuing dollar bond because they are expecting dollar to tank? Why not issue Euro bond?
http://www.bloomberg.com/apps/news?pid=20601087&sid=aJQOEPb4pCYg
Now here is something that is more fitting for the US finance industry. People are trading US govt bonds that never existed.
I am convinced that the whole US stock, bond, financial market is just a big Enron, when it unravels, many people will find themselves completely naked, when the US Treasury market blows up, that will be the most spectacular event of the whole century, or even centuries to come.
when the US Treasury market blows up, that will be the most spectacular event of the whole century, or even centuries to come
What about 12-21-2012?
Speaking of housing, did anyone notice that the tax code for 2008 allows one to deduct house property tax, even when one does not itemize? That is a boon for people with paid-for or nearly paid-for houses.
You dirty rat - you got me all excited. I downloaded the 2008 forms and was disappointed. For filing single, you can add your property tax onto the standard deduction UP TO A TOTAL OF $500. See instructions for line 39c on page 34 of the 1040 instruction book.
Big whoop. That's chicken feed compared with what many people are paying for property tax.
Oops, I missed the part about a dollar limit on the property tax addition to the standard deduction.
It's $1,000 for us married folks, so it will still take $250 or so off my taxes.
Maybe next year it will be raised along with the normal standard deduction.
I was interested in buying a house a few years ago but it there seemed to be too much of an ownership premium between renting and owning, so I didn't buy it.
Now there's getting a high ownership premium between those one ounce bullion coins and the GLD and SLV. That sounds like another bubble.
I live in Glenbrook Apartment, Cupertino, 95014 -- two bedroom, 1100 sq ft, upper level with balcony. I pay rent of 2290 per month. For the last four years, Glenbrook has been raising rent yearly once at August by 8%. Do you think they will do so in 2009 August? If they do, what will be their excuse -- higher prices of everything?
@OO
Could you translate the Bloomberg article into English? I am not in the finance field and am confused about the Treasury issue. I own short term Treasuries due in January through Vanguard Brokerage. Are they at risk?
well permaRenter that is interesting.
I've lived in the same neighborhood in 95148 for 41 yrs, the typical sales price increase in regression over any extended interval over all those years has been about 8%. Right now it's slightly below, about 7.6% going back to 1968, probably as good a buy indicator as any I've seen.
@Danville,
The Treasury is 100% safe in face value, because US government can always foot its promise through printing. But, between the Treasury and YOU, there is a layer called PD, which is primary dealer, because the government doesn't deal directly with you, they deal with you through primary dealers like Chase JP Morgan, Goldman Sachs, Mizuho etc.
http://en.wikipedia.org/wiki/Primary_dealers
Over the course of last year or so, the problem of non-delivery has gotten very rampant in the Treasury market, which means, when you pay your money to a fund that claims to be holding Treasury, you think you are holding Treasury, but no, these PDs are taking in money WITHOUT delivery. This is also known in the stock market as NAKED SHORT, which means two things (or more)
1) scam, they just take your money and pretend to sell you Treasury. In the end, you pay them $$$ and hold NOTHING, or
2) they forsee the Treasury price to collapse, so they are trying to sell as much T as possible and buy them back when the price goes down.
Vanguard is a reputable fund house, unlike PIMCO, so I tend to think that they are more likely to hold some real T in their portfolio, but there is NO knowing unless you call them to verify. Even Treasurydirect is not safe in this scenario, because you are still going through PDs, and one of those PDs can do the same fail-to-deliver to you.
IMHO, it is much better to hold physical cash, even in USD, than holding US T, which tracks the parabolic pattern of oil, and is currently at the historical high. Short-term US T has reached a negative return, you'd be much better off holding straight cash, physical cash, in your Sealy bank.
OO and DW:
I'd assume if you're elite richees, you wouldn't fart away your time on this website. So, if you're among the rest of us, you're in the savingsbonds.org crowd.
Together with spouse you can accumulate about 40k per year of these. Used to be able to build up a portfolio up to 120K per year. For those that you hold for at least a year they are all dollar good, an awesome way to "save". I have some earning over 8% interest, tax deferred, free from CA SIT.
OO,
Wow. That is just plain wild. The big broker/dealers will find any systemic weakness and exploit it to the max. Especially now, they are desperate to cover their losses from the mortgage market, and shenanigans in the bond market appears to the next big thing, along perhaps with speculating in beaten-down mortgage paper.
Vanguard:
I have more faith in them than most any other mutual fund company or broker when it comes to protecting the integrity of the customer assets.
That does NOT mean that Vanguard funds do not lose market value. They have and they do. I just think they are more conservative in protecting against outright securities fraud. But as OO said, Vanguard is NOT a Primary Dealer. But I expect Vanguard pay very close attention to their transactions with the Primary Dealers.
Not investment advice, but I use Vanguard for some purposes.
Perma,
If you're not married to Cupertino schools, I think you should get a much better deal elsewhere :-).
Besides, Cupertino has horrible drivers. :(
Are prices coming down yet? I have stopped looking completely.
For the last four years, Glenbrook has been raising rent yearly once at August by 8%. Do you think they will do so in 2009 August?
I live in Sunnyvale and they have been raising our rent every lease period for the last couple years. This time around, it looks like rent will remain the same.
@OO
My guess, then, is that it would be safer buy treasuries at www.treasurydirect.gov
What do you think?
@OO
I just re-read your response. It seems that you even go through a dealer with www.treasurydirect.gov which seems odd and very misleading. Their website implies that you are dealing directly with the government and not an intermediary. Scary stuff.
Happy New Year all. According to the latest H.3 report from the Fed, nonborrowed reserves has gone positive! Also note, the latest TAF auction (85 days, $150B) had a bid-to-cover ratio of .69 ($102B); the previous auction (85 days ago) had a bid-to-cover of .92 ($138B) so things seem to be settling down a bit (or at least moving to the more exotic Fed/Treasury programs). The Treasury Supplemental account in the H.4.1 release also appears to be getting paid down.
Using 2% MoM declines we reach equilibrium now in April/May of 2009 - but that is relativeto retracing the bubble using an anual BA historic appreciation of 4.25%.
Duke, somebody out there agrees with you. A C/S SF Home Price Index future for May 09 sold for 119 yesterday. Also, check out the Nov 09 future that traded hands today for 116.
http://www.treasurydirect.gov/about.htm
"TreasuryDirect is brought to you by the U.S. Department of the Treasury Bureau of the Public Debt."
"About TreasuryDirect
TreasuryDirect is the first and only financial services website that lets you buy and redeem securities directly from the U.S. Department of the Treasury in paperless electronic form."
Venture Source said the median age of the venture-backed firm acquired in 2008 hit a record 6.5 years. Of the seven that went public last year, the median age was 8.3 years, also a record.
"The ever-increasing amount of time it takes for a company to go public or get acquired is stretching out the lifecycle of venture funds and therefore returns to venture firms and their limited partners," Canning said.
All of this goes to explain why veteran Silicon Valley investment firms such as Sequoia Capital and Benchmark Capital warned startups in October to lay off workers and slow hiring to extend their runway - the length of time they can operate on invested capital before cash flow carries them aloft.
"In market downturns, frugality is not only a virtue, but also it could be the difference between survival and failure," said Benchmark partner Bill Gurley. "You should watch 'months of cash' as your most important variable."
Frugality may have its place, but one also needs to hedge for the end-of-the-world risk. :) If the world ends tomorrow, have you enjoyed enough, or have you delayed your gratification beyond the end of time?
A quote from a 1924 edition of the American Bankers Association Journal sums up what is currently happening:
"When, through the process of law, the common people lose their homes, they will become more docile and more easily governed through the strong arm of government applied by a central power of wealth under leading financiers. These truths are well known among our principal men who are now engaged in forming imperialism to govern the world. By dividing the voter through the political party system, we can get them to expend their energies in fighting for questions of no importance."
The Secret Bailout of J.P. Morgan
http://globalslaves.blogspot.com/2009/01/secret-bailout-of-j.html
Why Paulson Let Lehman Brothers Fail
http://globalslaves.blogspot.com/2009/01/why-paulson-let-lehman-brothers-fail.html
Blow SUYA,
So the claim is that Paulson let Lehman fail in order to give JP Morgan a covert bailout under the guise of helping JP Morgan acquire Lehman.
Pretty far fetched stuff, but perhaps not completely unbelievable.
The website looks pretty kooky, though.The site would be more believable if it backed up the claims with references, e.g. the claim about creating new classes of (lower priced) put options with expiration dates only 5-8 dates ahead.
In over-allocating money to one position, investors are typically prone to several short cuts that get them in trouble. One primary mistake is uniquely intertwined with Madoff's alleged scheme -- the allure of consistent small gains. A chart of Madoff's purported returns shows a line going steadily up, month after month, 1 or 2 percent. Those kinds of gains are intoxicating. Richard Peterson, a psychiatrist who co-founded MarketPsych, a Los Angeles psychological and financial consulting group, said we actually fall in love with them.
"It's like a slot machine that pays you a little each time," he said. "Over time you kind of fall in love with that machine. You'll actually have the hormones and strong attachment and bonding. You trust it. You want more satisfaction from these gains."
Peterson pointed to a famous study in Taiwan showing that gamblers chose a strategy paying them repeated small amounts even if at some point they had to take a huge loss. In more than 200 trials, the gamblers were given different decks to select cards from. In one deck, on average four of the five cards produced small gains, while the fifth card wiped out the wins and led them down a money losing path. The other decks of cards produced, on average, four small losses and one big win, which netted out to overall gains. The researchers were stunned when, given a choice, gamblers continued to want to pull cards from the small-gain deck.
"We like these consistent gains," Peterson said. "You can't underestimate their power."
In over-allocating money to one position, investors are typically prone to several short cuts that get them in trouble. One primary mistake is uniquely intertwined with Madoff’s alleged scheme — the allure of consistent small gains. A chart of Madoff’s purported returns shows a line going steadily up, month after month, 1 or 2 percent.
Is this for real?
What a crappy Ponzi scheme! I beat him last year *without* cheating!
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Why is deflation written about as if it were a bad thing? Personally, I love deflation because it means lower prices for pretty much everything.
OK, I can see that people will hold cash instead of investing it, because the cash is increasing in value. But that will end eventually as people spend the cash (unless the Fed just prints forever).
And I can see that it's hard to start up a business knowing that profits will probably decrease in nominal terms, but that can be managed, because costs will decrease as well. And if the business generates cash, that cash is more worth getting in a deflationary environment.
Maybe deflation is exactly what we need for a while, to wipe out foolish debtors and get the economy back into a sustainable state.
Patrick
#environment