Tuesday, December 2, 2014


The pundits of doom are reappearing.  This time it concerns the negative effect of the substantial and rapid decline in crude oil prices.  If the price of oil remains in the $70 dollar area it will cause the need for certain economic adjustments.  Some pundits are comparing the oil price decline to the housing crisis.

This is totally wrong.  The comparison is little or none.   The reason is that there were no real beneficiaries from the substantial decline in home prices.  There are countless beneficiaries from the substantial decline in crude.  That is the vast difference.  It will work out that way.  

Friday, November 14, 2014


Since our President seems unable to effectively gain the respect of Putin, he's busy directing his manliness towards battles with the Congress.

Wouldn't it be better if he projected an agenda aimed at working together to improve the American experience?

Wednesday, October 15, 2014


There seems to be so many negative headlines lately, Ebola, ISIS, Russia/Ukraine, Hong Kong Riots, Stock Market volatility, Destructive corporate policies, Secret Service scandals, Veterans Administration, IRS, Obamacare website fiasco and on and on.  All of these situations can be traced back to President Obama if only because he is the CEO of the nation.

His lack of action, his wrong actions, his inability to select experienced leaders, his inability to retain qualified leaders, his passivity, and his basic lack of experience is obvious.

He was elected on the premise of change. The reality is he has changed little for the better.

Sunday, September 21, 2014


In a recent edition of a well know NY newspaper, there was an interview with the head of Loews
Corporation, Jonathan Tisch.  In my opinion, this executive sits in his position of power due to the fact he had a brilliant grandfather, not the results his company has generated since his grandfather's passing.

What made the article worthy of comment, was an absurd last paragraph where the executive is quoted with saying " I was taught never start a paragraph with the word I.  It sends a message that "I" am more important than the people reading the article."  The insanity of the article is that there were about forty "I's" referring to himself in the very short interview.  In my opinion, I have never seen such an egocentric interview ever.

Watch out for interviews in this newspaper.  

Thursday, August 28, 2014


Russia will begin to cut back on natural  gas supplies to Europe and an invasion of Ukraine is probably not far off.

Wednesday, August 20, 2014


In a baseball game there are players at all different positions.  If you remove one player at a time from the field, each removal will weaken the defense against the opposition.  The same thing is true in other sports.  In a chess game the objective is to take pieces from the opposing player in order to ultimately capture the king.

It has become obvious to me, that there is at this time no possible way to settle the Palestinian question.  Years ago associates of mine tried to involve me in an organization called "Peace Now".  It was one of many groups that sought to provide a specific methodology for bringing peace to the Israel/Palestinian confusion.  I didn't agree with the "Peace Now" plan then, and up until now it seems to have been totally wrong.  

ISIS, Hezbollah, Hamas, Taliban, Fatah, Muslim Brotherhood, etc. appear to be different groups  with various positions on one issue or another.  Yet each one of these groups are acting collectively as one team, prepared to take on whomever chooses to challenge them.  If one group (player) withdraws from the field by settling differences with Israel, United States, etc. the entire group (team) is weakened. 

Consequently it is becoming obvious that a settlement from any single terrorist related group will not occur in any time frame relevant to current attempts.  


In the old days every army had people who were arrow makers.  They made an endless supply of arrows.  In addition, most battles were always...

Thursday, July 31, 2014


Israel is fighting for its survival.   CNN keeps putting up the United Nations representatives as the protectors of the Palestinians and not keeping the context of civilian casualties honest and unbiased.


In the old days every army had people who were arrow makers.  They made an endless supply of arrows.  In addition, most battles were always fought with a certain number of troops being kept in reserve.  Reserves have often been the difference between winning and losing.  Obviously, if you didn't have arrows you lost.

It's incomprehensible for Israel to not have an endless supply of ammunition. Their reserves are limited, but not to have ammunition suggests that this generation of Israelis generals don't fully grasp what happened to the French in Vietnam. Limited reserves, limited ammunition and confused leadership.  Very scary...

Wednesday, July 30, 2014


There are very few words to describe war.  People die horrible deaths.

In World war II 25 million civilians died.  In the continuing turmoil in the Middle East, Pakistan and Afghanistan, 250 thousand civilians have died.

Whether the four little Palestinian boys on the beach in Gaza were just playing or placed there is irrelevant. They are unfortunate civilian casualties of war.  No nation has made the effort to avoid civilian casualties more than what we see being made by  the Israeli government.

Most news media sources distort the news when they don't present the full picture of why civilians die in wars.

Israel and Hamas are at war.  Unfortunately civilians will die.  The news media has to totally stop "psychologically" trying to place the blame on Israel.

If Hamas doesn't want its civilians to die, all they have to do is stop fighting.


Gorbachev dismantled the Russian Federation.  Putin is going to rebuild it.

There are 140 million people in Russia.  Putin knows population counts.  Atomic weapons aren't going to be used therefore you need, in Putin's view, a powerful armed forces.

Ukraine has over 40 million people. Controlling the Ukraine would increase Russia's population significantly.

China doesn't care.  India doesn't care.  Europe is impotent.  We have developed a similar proclivity.

Most Americans don't serve in the Armed Forces.  It wouldn't be too difficult to make the leap into believing that we are served by a mercenary hired Armed Forces.

Europe and other countries in close proximity to Russia will have increasing fear of Russian aggression.  Our middle eastern allies will have an increased tendency to look East.

The West didn't lend help to the Ukraines...the consequences should be clear.  Weakened influence around the entire globe. 

Tuesday, July 29, 2014


The New York Times has the audacity to keep on telling everyone else how to live their lives, yet they can't recognize their own inability to manage their own house.  Today the New York Times reported another miserable business quarter.

Beware of about anything you read in this paper...

Monday, July 21, 2014


If you accept the thesis that Putin views the Russian population as too small to contend with the huge populations of Pakistan, Indonesia, India and China, etc. then you begin to see the reality of what is truly taking place.

If you accept another  thesis that there is a long term plan, most significantly by Russia and several Islamic terrorist groups, to diminish the European and American alliance then you are seeing  the real picture.

No one even talks about Crimea anymore.  We have absolutely no power to sanction Russia in any meaningful way.  The Europeans will not join with us for fear of losing their energy resources.  If Russia chose to cut them off, the hardship in the European nations will far exceed the drop of Russian oil revenues.  In any case, Russia is a country  on a mission and Europe would freeze before Russia gave in.

Putin realizes that no threats, from anyone, have any substance behind them. No one is prepared to go to war over any action that Russia takes.  What would we or Europe do if Russia decided to reclaim Poland, etc.?  Putin theorizes that there is absolutely nothing we would do.

We can't even stop the French from sending advanced weapons to Russia; even under the current circumstances.

There have been long periods history where fear of consequences trumped evil actions.

Because of the political mistakes made by the U.S., and Europe choosing to put its security into Russian hands, Putin now indirectly controls more oil outside of Russia than he ever could dream of.

Russia also knows no civilized nation is going to use atomic weapons.  It is only a question of how far Putin is willing to go to achieve the "Renaissance of the Motherland".

Thursday, July 17, 2014


The Taliban continue to thrive in Afghanistan.  Al Qaeda is still a problem throughout the world.  Iraq  continues in a semi-state of war.  Socialists have taken over in France.  Russia refuses to cooperate with the Obama administration in the Mideast.  Its seems if no progress has been made on the Iranian situation.  Egypt has elected fundamentalists similar to the Iranian government.   Syria borders on the unbelievable in this day and age. Obama was elected with little or no foreign policy experience.  

America's a democracy, we get what we vote for.  


Exactly at the point where everything is changing, pessimism runs deep in the personal computer space.

Practically no one who goes into an office or classroom setting uses a tablet to prepare their spreadsheets, letters, term papers, etc. etc.  We wrote a blog in April 2011 (A Retailer Making Computers) about the destructive nature of the tablet to the PC business.

Now we are pointing out that PC business is at the beginning of a resurgence of significance.

Wednesday, July 16, 2014


Russia provides arms to Hamas, Hezbollah, Iran, Taliban, Syrians, Al Qaeda, and almost every other anti-western military organization.

President Obama has actually believed that our "disengagement" would cause the opposition to retreat.  Thousands of years of world history has shown retreat becomes an endless process, where at best you are left with the choices of the aggressor.

A recent New York City newspaper editorial wrote about weakening the Russian expansion by building our energy independence.  This editorial actually talked in some whimsical way about President Obama capturing the moment by setting us on a decades long rebirth of our nation.

Russia has slowly but surely cemented an increasing share of the energy supply.  As I wrote in a blog a while back, it would have been alot easier to solve the Syrian situation if we would have done what had to be done at the beginning of this murderous catastrophe.

It has been forgotten in the press that up until recently a Russian battleship was stationed in Cuba. As far I know, it may still be there.  If Russia will not back down when we stand up to them, its only a matter of time when we reach the point that they will never back down and guess what, we will.

Just as the IPad changed the outlook for the PC Industry, Russia's long term plan seems to be the resurrection of the Russian Empire, especially under the Obama administration.

Tuesday, July 15, 2014


The first thing that really has to be understood, in order to have clarity of insight,  is to determine whose in charge.

In the money management industry people sometime change from one manager to another.  When they do their existing portfolios consist of stocks and bonds.

The new money management firm takes on responsibility for managing the client's portfolio; meaning they have responsibility of the clients assets from the day they receive the new client's portfolio.

It is close to impossible to be able to blame the prior portfolio management firm for performance under the new manager's aegis.  The new manager is responsible for the performance from day one and can't blame poor performance on who managed the money before them.

This exact same concept is true about foreign policy. President Obama and his team have been responsible since they got elected.  They made their choices, they could have made different ones.

The dominoes are falling in the Middle East and potentially in alot of other places around the world.  As the Polish foreign minister just implied, relying on president Obama for protection is ludicrous.

Blaming George Bush or Cheney is politics and is the rhetoric of self interested and dangerous people.  It was Obama's portfolio from the day he was elected. 

Tuesday, July 8, 2014


We continue to watch the ineptitude of the Obama administration.

President Obama blackmailed Israel into supporting the joining of Hamas with the Palestinian government.  The weakness of our foreign policy is allowing the Middle Eastern dominoes to fall.  Jordan, Kuwait and Saudi Arabia will be next.  Unfortunately I don't believe you can stop terrorist organizations with fancy words and appeasement.

We may be getting close to a tipping point, with Kerry and Obama totally incapable of handling the situation.  

Monday, July 7, 2014


Human nature may be human nature.  The atrocity in Israel of six Israeli Jews murdering an innocent Palestinian boy reaches beyond what diaspora  Jews expect Israel to be.

I have written about the black murders in Chicago extensively.  The fact that a disproportionate number of murders were committed by black people meant little.  The color of their skin was irrelevant, it was the murder rate that was and still is atrocious.

As a Jew, continuously supportive of the plight facing Israelis, I now find myself disgusted. There is no excuse or explanation any more so than applies to any other group of people.  A friend of mine once told me that if Jews don't support each other, no one else will.  If this is what the circumstances have brought Israeli's society to, they are no better than any other crime ridden group.

The fact is, just as there are significant problems in minority segments of our population, there is a big problem in Israel.  Explanations don't cut it.

Thursday, June 26, 2014


The Democrats don't like attacks on their policies.  They often turn to the "race card" in order to divert attention from the issues.

An Attorney General is supposed to bring  peace and healing to the national agenda, instead he brings race.

If I've ever seen "racial animus" in action it's when 95 percent of the black people vote for a man just because of his color.  Take a look in your own closet and stop bringing hatred, instead of peace.

There's animus everywhere, always has been, always will be.

Tuesday, June 24, 2014


I was interested in what went wrong at the VA and I looked to see if their work force was highly unionized. It was only logical to look and see if the IRS is unionized also.  Guess what...they are both highly unionized.

I've written several blogs about the unionization of government.  We are republishing just one below that was originally published in January 2011.

 "Are Destructive Union Votes Worth It?"
Tuesday, January 11, 2011 ARE VOTES WORTH IT?
On August 27, 2010, we said in a blog that "Almost every significant unionized industry in America has failed. Now the largest unionized segment in America is government."

In the January 8, 2011 issue of the Economist magazine the lead story is titled "The battle ahead - Confronting the public-sector unions."
If you accept the thesis that I'm even partially correct about the negative effect of unions and their inflexible total compensation costs being responsible for destroying the competitive condition of significant industries, you will be well advised to ask "Are unions likely to destroy the government?"
Isn't it only a matter of time before some union representing the fire department, police department or the post office, goes on strike? Obviously it will happen. It's tough to change people. Note carefully the behavior of certain union members during the recent New York City snowfall.
During the ongoing turmoil in Wisconsin, a prominent Democrat exhorted the public to "stick by their friends." This may have been true a few decades ago when people took government jobs based on their security, retirement benefits and often a lack of complexity.
Today we have evolved a system where the unionized government sector indirectly threatens to strike and withhold their votes from the government politicians who don't give them what they want.
Government gets its money from taxes; so what these unions are saying to their so called "friends" is give us more of your tax dollars or we will take away your services.
During the formative years of our republic, there was serious debate about what functions the central governments would serve, both at the local and the federal levels. After Hamilton's persuasive arguments for a collective defense among the states, it was also agreed that government would stay close to the people by providing all types of services, and thereby make it easier for existing members to get reelected.
Think carefully about what some of the things the government does for us. We go to a post office, they hand you your mail. You go to a motor vehicle office, they hand you a license. You apply for a passport, they mail you a passport. They send you social security checks. These are simplistic functions that can just as easily be done by the private sector, for profit, save money, and reduce the deficit significantly.
Functions that don't have to be done by government should be taken out of the hands of government. It's time for a more introspective America, especially in some of our big cities where people think that the sharing of ideas around water coolers actually adds merit to the city.

Thursday, June 12, 2014


President Obama would never have been elected if he wasn't black. The color of his skin should have been of as little value to a voter as gender, sexuality, etc.  In a perfect world, one's view of the competence of the candidate should have been the most important factor to consider.

I don't find any pleasure in criticizing the President of the United States.

For whatever my humble opinion is worth, I'm hard pressed to find in history many Presidents who have done the country so much harm.  It is crystal clear to other countries that the primary foreign policy that we are following is one of isolation.  Obama seems to be talking about building coalitions without any comprehension that the coalitions on the other side are rapidly escalating in size and power.

At first Congressman Cantor's election loss seemed like a passing event. Cantor's views on the economy, health care, education or immigration didn't play the part in the outcome as common wisdom suggests.  It seems more likely that it was the voter's reaction to Cantor's  past negotiations with President Obama. His constituents wanted him to hold the party line and not concede, so as to show  the value of conviction.

Not holding the line in the face of an attempt to gain at our expense in the world political equation won't work either.


Its been said by some psychologists that opposites attract.  Its been said by others that common interests attract.

Is it possible that what we are seeing in international relations is a "tipping point"?

Those countries that have oil will be entering into an era of diminishing common interests with the oil consuming nations.  In its place will begin a second OPEC, more concerned about maintaining the price of a barrel of oil than their fear of having their governments replaced by radical elements within their own societies.  Russia, Iran, Saudi Arabia, Iraq, Kuwait, Venezuela, Brazil, etc. will strengthen their connections and alliances.

The message that will be sent is that you will not force the price of oil substantially lower by rhetoric of climate change and the need for alternative energies.

This will incrementally increase the reliance on oil suppliers.  We are in no position to have the revenues of oil supplying nations substantially reduced by policies of reducing oil consumption.

Too much tax revenue is collected from oil consumption, too many people feed their families due to oil production and the simplistic appeasement of Russia will reduce the loyalty of several significant producers towards the United States.

Sunday, May 18, 2014


The New York Times often writes articles about the inequality of wealth. Without further comment, I looked at the total compensation of the top executive at the New York Times. This is a very poorly run company and in my opinion has done almost everything wrong. The total compensation of the top executive at the New York Times was approximately $6,000,000.00 in 2009. (Same now in 2014) Enough said for now. Stay tuned...

Thursday, April 3, 2014


Back in the day brokerage firms were owned by partners. If the firm lost money, the partners were personally liable. Commission charges to buy and sell stocks and bonds were extremely high but no one forced anyone to buy and sell stocks and pay those fees. When I was originally a broker at E.F. Hutton and Company and I wanted to get a quote on a stock, I walked up to the front of the room, stood in a long line, picked up the phone and was able to request one quote and only one. I then had to find my way back to the desk through the throngs of other brokers, I would give my customer the quote which really wasn't current anymore, I would write out the order on what was called a trade ticket, I would put it in a vacuum tube, it would travel a long distance and about an hour later I would know if we bought the stock or not. Times have changed.

Somewheres along the line the powers that be decided that fixed and high commission rates were not the way to grow a hearty participation in American Capitalism among the people. Rates were then lowered, then lowered, then lowered, and then lowered. It also came to pass that "money management for a fee" began its monumental growth. We now can trade billions of shares a day explained by the cult of the necessity for a liquid market. The liquidity is well out of balance with the actual need and has turned stocks into the semblance of a gambling casino with all the rules and regulations of such activity very much in place within our markets. Research is superficial and shoddy at best, but thinking, fortunately, keeps evolving through higher and higher levels.

About the same time,Donaldson, Lufkin and Jenrette found a way to pierce the wall of the New York Stock Exchange prohibition requiring all member firms to be private. The cry became "the road to growth requires public capital and we as partners can no longer foresee having enough capital to sustain significant growth". The members of the exchange tried to maintain their historical rules of private companies but the opportunity for making the existing partners wealthy men controlled the outcome. So the door was opened and privately owned firms were able to create great wealth for their owners by selling shares in their privately owned companies. There is no question that I personally benefited from this "time in history". The combination of much lower commissions and the loss of the future money management asset growth, made the traditional brokerage business a heck of lot less profitable, even with the ancillary interest income.

This is the story of what really led to the breakdown of the investment arena into a gambling casino.

Wednesday, February 26, 2014


For those of you that are interested in the stock market I'm sure you read about the advantages of investing in low cost market index funds.  As the expectations for hedge fund rate of returns continue to decline, more and more money will head toward the indexes.  Whether this is good or bad is entirely another story.

For lack of being able to put it in a better context, I draw your attention to the liberal Attorney General of New York State.  A "lightweight" according to Donald Trump, and probably a light weight in reality.

Recently the Attorney General of New York State made some kind of agreement that asset management firms had to change the way they solicit information from Wall Street analysts.  First of all there is some serious question of whether most information solicited from analysts, on a repetitive basis, adds over time to the performance of equity portfolios.  I venture to say that it doesn't.

But this is not the point.  Our economic system is predicated on the hope that one can rise from the ashes to the top of the heap.  When someone has money to invest, it is human nature to try to make the best possible investment they can.  If they give their money to a "professional" they expect that professional will seek and evaluate information to give the investor some hope of outperforming the returns from the indexes.  It is hope that creates excitement in life.

What the Attorney General of NY is trying to do is a typical liberal ploy of intimating to the public that they are somehow being taken advantage of by money managers seeking to increase the value  of their clients investments.  According to his liberal left wing policy, everyone should be on a a so called "level" playing field.  There can never be such a thing  as a "level" playing field in the world of equity investing, because there is no such thing.

The result of the Attorney Generals' actions will have absolutely no impact on the performance of portfolios. What it will do is take away hope, reduce incentive and move everyone to becoming more and more of a robot.

Tuesday, February 4, 2014


In every one of the wars between Israel and its neighbors, Israel was the one attacked.

Various Arab or Palestinian people seem  to feel that they are entitled to request compensation for land they claim they previously had rights to.  Whether true or not, it is not nearly the point.

If we go back and trace the history of nearly every country, we would find that land had originally belonged to other people.  No one talks about every other country paying back historical owners of their land, only Israel is expected to act differently.

Tuesday, January 28, 2014


For twenty years I have read almost everything I can find on the history of Germany and its people.  There are no words to describe World War II and the Holocaust.  Words like horror, terror , Apocalypse, torture, cruelty, abomination and whatever you can think of cannot represent one grain of sand in the atrocity of the Nazi regime.

Albeit, that does not take away from a person's right to compare the holocaust to other human behaviors.  Whenever a minority group by race, religion, sex, economic standing, disability, education level or any such criteria are singled out for a form of punishment, that they are not given a right to vote down, they may be being abused.

The first thing the Nazis did was to confiscate the possessions of the Jews.  It was only later that the physical tortures and annihilation came into being.  

A person's wealth is their personal possession.  The Democratic party has singled out what has been called in the press the top "1 percent" as almost criminal because they have more money than others do.  The truth in the matter is that progressive tax rates don't increase the standard of living of people of less wealth.  What they do is form the basis of a democratic political  policy of promises rather than real results.

It was said long ago if we really want to improve our "best of class" country to an even better place we can.  We have to add more policies that increase the well being of the largest majority of people and stop the class warfare.

For the record, Federal Express and UPS do a more efficient job than the United States Postal Service.


A friend of mine went to a Doctor.  She was told she had a severe cancer.  The hospital had an experimental drug for this type of cancer.  She went home, looked up the drug, found out who made it and bought the stock.  Not only that so did her family, etc.  As it so happens the drug did not work as it was thought it would and the stock eventually collapsed.  The patient died.  Did she use inside information to purchase this stock?  Should her estate be sued for her use of this "inside" information?


The problem with President Obama is that he knows that his proposals on minimum wage are destructive to economic activity, not constructive.  The point being he proposes them anyhow because he is not interested in true economic improvement, yet only interested in political power which can come from giving people what they think they want, even if it will do them more harm than good.

President Obama should focus his energy into improving our educational system and providing more economic incentives to people of all ages who want to further their education so they can pursue higher level jobs.

Many young people have started by earning minimum wage and then worked hard to rise in their ranks and increase their income through success in their careers and seeking further education.  That is the way the world works.  If it isn't broken, why does he insist on fixing it?

Thursday, January 23, 2014


There are so many things I could write about but I don't.  Our infamous government can't get Snowden, so it goes after a young money manager who tried to make his clients money.

The subject of what represents "research"on behalf of investment management clients has not even begun to unfold.  

Shepard Osherow. All Rights Reserved