David Neubert

CIT - Saving Money After The Bankruptcy

David Neubert — 2009-11-03T15:26:00Z

Even if you don't own any stock in a bankrupt company, your portfolio is still at risk.

Regulators recently let CIT Group (CIT - $0.26) fall into bankruptcy. When a large company goes bankrupt creditors (bond holders, lenders and vendors) can usually get part of their money back, stock holders are nearly always completely wiped out.

Last year Bear Stearns avoided bankruptcy by selling to JPMorgan (JPM - $42.58). Shareholders were basically wiped out. A slow panic ensued and prices of all financial institutions began to fall. Fund managers and traders were selling all banks and broker stocks. Investors realized they didn't know how to analyze the complex structures of financial institutions anymore.

How would a long term investor who doesn't have the time or interest in trading adjust a portfolio? Any bankruptcy creates winners and losers. The losers are the shareholders and employees (sadly) of companies that took much risk (gambled and lost); the winners are the the survivors who pick up customers and brands lost by the bankrupt company.

What would I do? Sell individual bank shares and buy a fund that holds a large and diverse group of banks. This diversification protects against a debilitating loss from an individual bank failure (it will hurt but won't kill). However, when the winners and losers are sorted out you'll own a portfolio dominated by the stongest and most profitable banks.

In the face of the CIT bankruptcy, one company at the risk of another investor panic is Citigroup (C - $3.98). Citigroup is a terrific institution with great banking franchises and brand recognition all over the world. However, they made some bad decisions and made a lot of risky loans that are either not paying or are in danger of not paying. I think Citigroup will survive but not after another potential panic on it's shares. I've been selling my Citigroup shares and am planning on putting the money into an ETF that focuses on the financial sector - my choice, the Financial Select Spider (XLF - $14.17).

Brother Jimmys Named as Up and Coming Franchise

David Neubert — 2008-11-21T23:22:00Z

Brother Jimmy's BBQ, where I am currently a member of the board and investor, was named as a "Next Big Chain" by AOL Small Business. Well, AOL from your writing to God's ears. As someone who was a vegetarian until I was thirty most of my old friends find it ironic that now I'm a huge fan of pulled pork. Congrats to Josh Lebowitz (CEO of Brother Jimmy's Restaurants) and his team of managers for yet another positive review.

Here's a photo of Jimmy Goldman (founder of Brother Jimmy's) at his son's bris. Yeah, Brother Jimmy was founded by a New Yorker who went to college in the south and fell in love with best North Carolina has to offer.

This is from the first ever bris I attended and I have to say I got pretty quezy. But I thought the ceremonial aspect of a boy becoming part of the community was pretty cool.

David Neubert Video Appearance on Fox Business News from February 2008

David Neubert — 2008-07-01T23:21:00Z

I'm trying to archive some of my video appearances on this blog. This was a fun appearance on the Fox Business show Happy Hour set in a a bar. In 1991 when I first moved to New York the big Latin American Debt traders (I was a little time trader) took me to the Bull and Bear bar in the Waldorf for "claritos". A clarito is South American for vodka martina. Funny, that I ended up in the same bar on Fox Business 17 years later as a pundit. Who would-a-thunk it?

Napping At The Office

David Neubert — 2008-06-30T22:03:00Z

I have recently become a fan of napping at the office. My office in Little Italy near lots of espresso bars but it also has a sofa.

I feel a quick nap does more to improve my mood than caffeine and it turns out there is a study that agrees with me. It turns out that a 5 minutes disco nap can be better than a couple cups of coffee. I'm hoping to nap every day. This write-up at productivity site, 43Folders.com has a cool info graphic and lots of tips and scientific facts about how to nap. Most people, power nap at lunchtime in their cars.

The office in Little Italy where I'm working/consulting you ask? Well, we are busy designing the software but we still don't have a name. When we do I will start blogging on that too.

Full Disclosure: The photo is posed.

Short Films on Cycling

David Neubert — 2008-06-26T22:57:00Z

George Bliss, an advocate for pedicabs in New York City is featured a short film about his work. Oddly, because of a lawsuit by a passenger he cannot get insurance to operate a business. Instead he works to get all the ugliness that cars create in New York off the streets.

The video is sponsored by Puma. Since the site doesn't allow specific linking to a video, use the watch more button to find the video called Bliss And The Wheel.

A New Toy: Sport Flying

David Neubert — 2008-06-12T17:59:00Z

My friend, internet goddess and design guru Emily Davidow shared a link about this potential toy with me.

I had no idea that the FAA created a new type of pilots license called Sport Pilot's license. So you can't fly at night, only on instruments or in bad weather or land at major airports. Who cares? I just want to get in, fly around and return to earth. There is a flying license for that and now a company taking advantage of it. I'm sure there will be more. I think I'll wait until these little planes have been heavily tested by regular consumers before I get one though. And that may be years away.

When Everything You See Seems Relevant

David Neubert — 2008-06-10T19:40:00Z

I saw two sonnets above the urinal at a Wall Street software company in Boulder, Colorado last week. The company was running an in office contest to pick the best sonnet of the day. I thought it ironic and refreshing that two sonnets concerning a woman's loss of love would be what these computer men read while standing at the urinal.

I Shall Forget You Presently, My Dear

I shall forget you presently, my dear,

So make the most of this, your little day,

Your little month, your little half a year,

Ere I forget, or die, or move away,

And we are done forever; by and by

I shall forget you, as I said, but now,

If you entreat me with your loveliest lie

I will protest you with my favorite vow.

I would indeed that love were longer-lived,

And oaths were not so brittle as they are,

But so it is, and nature has contrived

To struggle on without a break thus far,—

Whether or not we find what we are seeking

Is idle, biologically speaking.

Edna St. Vincent Millay

Tell Me Some Way

Oh, you who love me not, tell me some way

Whereby I may forget you for a space;

Nay, clean forget you and your lovely face--

Yet well I know how vain this prayer I pray.

All weathers hold you. Can I make the May

Forbid her boughs blow white in every place?

Or rob June of her rose that comes apace?

Cheat of their charm the elder months and gray?

Aye, were you dead, you could not be forgot;

So sparse the bloom along the lanes would be;

Such sweetness out the briery hedges fled;

My tears would fall that you had loved me not;

And bitterer tears that you had gone from me;

Living you break my heart, so would you dead!

Lizzette Woodworth Reese

Radio Netherlands

David Neubert — 2008-05-13T17:59:00Z

I had what I thought was a somewhat revealing interview on Radio Netherlands last month. The editor of The Panelist, Michelle Haimoff, describes the Radio Netherlands interview.

Blogger Table At Bourbon and Branch

David Neubert — 2008-05-09T18:42:00Z

The Panelist Media board member and friend Ace Durjoy Bhattacharjya got some friends to together to tell us all about his new venture. We ended up meeting and making a lot of connections over tricky, hard to understand but easy to drink cocktails. Reservations and entrance to the speakeasy Bourbon and Branch were complicated but worth it.

I met several New York to San Francisco transplants and bloggers like communications blogger Renee Blodgett, technologist Deborah Shultz, search diva Vanessa Fox, Natala Menezes from Microsoft and photographer Gene Hwang.

Do I get photos? No. Did I get video? No. Did I get a hangover? Yes.

Almost Lost My Blog At Godaddy

David Neubert — 2008-05-02T01:40:00Z

I went thirteen months without a blog entry and somehow turned of my payments and lost my blog at Godaddy. Imagine my horror when I realized that DavidNeubert.com was blank. After much begging and lots of "no sorry that's impossible" the people at Godaddy managed to recover my lost blog entries.

Since I co-founded ThePanelist.com with Michelle Haimoff and Undici Design last year I've focused most of my writing on my stock picking blog.

Since my last entry thirteen months ago I have joined The Board of Performance Space 122, a non-profit edgy theater in the East Village of Manhattan.

Joined the board of the startup Alloy Theater Company founded by the Irish Lawyer turned actress, Maxine Linehan.

Added to my two other board positions Brother Jimmy's BBQ and The New World Foundation I'm damn busy. So busy, in fact, that I had to take on another startup. More on that later.

I'll be back in another thirteen months.

Men, Women, Money and Neubert on Lime Radio at Sirius

David Neubert — 2007-03-28T20:17:00Z

You can read Karen Salmansohn's Daily Love Happiness Carrer and Money Empowering Blog entry about my segment here. I keep getting promised that Lime.com will post the podcast of one of my three appearances soon. Don't worry, I'll announce it.

I will now be a weekly guest on Just Be Happy Dammit Radio. Every Wednesday between 8:00 and 9:00. My segment is called The Panelist for the new location of my financial blog website/magazine to which I am dedicating most of my time.

Playing Intel (INTC) as a Value Stock But Using an Options Cocktail

David Neubert — 2007-03-22T21:33:00Z

I wrote this blog on my Intel (INTC) trade at the Panelist. Read and tread with care, this one is full of options.

The link to my blog (Neubert's Trades) at The Panelist is: http://thepanelist.com/blogcategory/Neuberts_Trades/ You can subscribe to it using RSS.

Neubert on Lime Radio at Sirius.

David Neubert — 2007-03-20T20:51:00Z

I'll be on Karen Salmansohn's show, Be Happy Dammit, on Lime Radio tomorrow (Wednesday March 21) from 8:00 - 9:00am. I think I'll either be in the 8:15 or 8:30 slot.

I'll be talking about markets, personal finance, money and happiness. Not sure exactly where the conversation will go but I know Karen's been asking about housing prices and recent mortgage market shake-ups.

Unfortunately, you need to be a Sirius subscriber to hear the show.

Selling Verizon (VZ) to Make Room for General Electric (GE)

David Neubert — 2007-03-20T19:59:00Z

Why did I sell Verizon and buy G.E.? See my blog entry at ThePanelist.com.

A 12-Step Program for My Citigroup Addiction

David Neubert — 2007-03-06T23:17:00Z

See my financial blog called Neubert's Trades at The Panelist (this is my personal blog) for my recent entry on CitiGroup (C). I just couldn't help myself but buy.

Nevada versus Massachusetts: Burning Man versus Freezing Man

David Neubert — 2007-03-06T21:20:00Z

Burning Man! Heck no. Blogger Ethan Zuckerman in Western Massachusetts proposes Freezing Man Festival. Bet you won't see any naked hippies at his arts festival.

Well, I'll be looking for his photos from Freezing Man 2007. In the meantime, here's the link to my photos from Burning Man 2006.

Cut One-Third of My Exposure to the Japanese Yen.

David Neubert — 2007-03-06T21:15:00Z

A short entry on my Japanese Yen position at ThePanelist.com.

Here's the RSS Feed for Neubert's Trades at ThePanelist.com

Adding to Home Depot (HD)

David Neubert — 2007-03-05T15:39:00Z

Added to my position in Home Depot (HD) blog entry at The Panelist here.

Buying Amgen (AMGN)

David Neubert — 2007-03-01T03:33:00Z

Blog Entry on my purchase of Amgen Inc. at ThePanelist.com.

New York Times (NYT): Read The Paper, Sell The Stock

David Neubert — 2007-02-27T06:40:00Z

I wrote about New York Times Company (NYT) on my blog at The Panelist.

Disclosure: I am the principal shareholder, publisher, founder and a blogger at The Panelist.

TXU

David Neubert — 2007-02-26T22:37:00Z

A couple of articles I wrote at ThePanelist on TXU:

The Panelist: Environmentalists Change TXU corp

The Panelist: Did Neubert buy TXU?

Selling Gold Futures Holding Global Gold Miners

David Neubert — 2007-02-23T06:11:00Z

My trading blog has moved to Neubert's Trades at ThePanelist.com.

See today's entry on my sale of April gold futures at 684.40.

Selling Half My Stoneridge Inc (SRI)

David Neubert — 2007-02-22T18:21:00Z

I wrote about selling half my position in Stoneridge Inc. (SRI) at ThePanelist.com. Here is the link.

Blog address: http://thepanelist.com/Neubert%27s_Trades/Neuberts_Trades/

Seaspan Corp (SSW) Reacting To A Rating Cut By Lazard

David Neubert — 2007-02-16T18:20:00Z

I am writing several times a week in my blog for The Panelist. The title of the blog is "Neubert's Trades".

Here is my reaction to today's ratings cut by Lazard on Seaspan (SSW)

I also mention Knightsbridge Tankers Limited (VLCCF).

Disclosures and Confessions: I own SSW. I have bought and sold SSW in the past two years. At current prices I am unlikely to buy or sell Seaspan. I own VLCCF. I have bought and sold VLCCF if the past two years. At currently prices I am more likely to buy than sell Knightsbridge Tankers.

Disclaimer: Nothing in this trade log is meant to be specific financial advice or a recommendation to buy or sell. I do not give investment advice. Do your own research. Do not rely on anything in this weblog to make investment decisions. I do not log all my trades here. I only describe or mention those that I think might be interesting. Consult an investment professional familiar with your specific financial situation before buying or selling any security.

Strong 30 Year Treasury Auction: No Big Deal

David Neubert — 2007-02-08T20:19:00Z

I wrote about today's treasury auction and US Saving Bonds (I-Bonds) on my new blog at ThePanelist

Link to My Blog On Today's 30 year Treasury Auction

Link to Entire Blog Called Neubert's Trades (you can subscribe to the RSS Feed just for this blog too)

Looking For Stocks to Sell? Pfizer (PFE) is not One of Them

David Neubert — 2007-02-07T23:01:00Z

I wrote this one up at Neubert's Trades at ThePanelist.com. Pfizer (PFE) just keeps looking like a value stock.

Disclaimer: Nothing in this trade log is meant to be specific financial advice or a recommendation to buy or sell. I do not give investment advice. Do your own research. Do not rely on anything in this weblog to make investment decisions. I do not log all my trades here. I only describe or mention those that I think might be interesting. Consult an investment professional familiar with your specific financial situation before buying or selling any security.

Yahoo Blows Away Google in Time Spent Online But Not On Valuation

David Neubert — 2007-01-28T22:59:00Z

As I go over Yahoo (YHOO) earnings data I was happy to see a decent increase in revenues even if earnings disappointed. However, it does seem that Google (GOOG) looks like the better value. (According to First Call, Google has a 2007 P/E of 35 vs. 52 for Yahoo). Then I came across the following blog entry by Jay Meattle at Compete.com: He shows top 20 US website usage ranked by time spent on line. MySpace, owned by Newscorp (NWS), comes in first at 11.9%. Second place belongs to Yahoo at 8.5%, four times the amount of time spent on Google (fifth place) at only 2.1%. These kinds of numbers continue to disappoint me in Yahoo's management who can't seem to monetize such an industry leading position. My support of shareholder activist Eric Jackson's Plan B to change Yahoo strategy continues as the best way to extract value from Yahoo.

Disclosures and Confessions: I own Yahoo and plan to pledge my shares to the campaign. However, if the shares rise above $35 I'm likely to start selling. I'm short Jan 2008 35 strike calls against half my position of YHOO and am also short Jan 2008 30 strike puts. I do not own Google (GOOG) but have traded it (both short and long) in the last two years. I do not own News Corp (NWS) nor have I traded it in the past two years.

I like Yahoo!. For years MyYahoo.com has been my browser startup page; I pay to use Yahoo enhanced email; I have over 2000 photos on flickr; I find Yahoo finance to be almost as good as Bloomberg but without the $1800 a month price tag; I have even been using Yahoo's search recently and find it so greatly improved that I don't need Google as much, I have registered websites using Yahoo.

Disclaimer: Nothing in this blog is meant to be specific financial advice or a recommendation to buy or sell. I do not give investment advice. Do your own research. Do not rely on anything in this weblog to make investment decisions. I do not log all my trades here. I only describe or mention those that I think might be interesting. Consult an investment professional familiar with your specific financial situation before buying or selling any security.

A Liberal Op/Ed on Forbes

David Neubert — 2007-01-26T18:05:00Z

I like this commentary on Forbes.com by Martin T. Sosnoff. Among the many stocks he mentions, the companies in my portfolio are WMT, HD, LEH, and AAPL. He is on the side of the shareholder activist and corporations treating shareholders like owners. He also talks about Walmart trying to improve its public image through deeds not just advertising. This op/ed would fit nicely into the editorial mission of The Panelist (where I am the founder/publisher). I wish we could afford him as one of our staff writers.

Disclosures and Confessions: I own Wal*Mart (WMT), I am short Jan 2008 47.50 strike calls on WMT. I own Home Depot (HD). I own (LEH). I am a former Managing Director at Lehman and am still vested in their executive compensation program. I do not own AAPL directly but have traded it in the last two years. I am short Jan 2008 AAPL 80 Strike Puts which will oblige me to buy AAPL at 80 should Apple Inc should the shares fall below 80 by expiration.

Disclaimer: Nothing in this blog is meant to be specific financial advice or a recommendation to buy or sell. I do not give investment advice. Do your own research. Do not rely on anything in this weblog to make investment decisions. Never engage in options, futures or margin trading unless you are an expert. I do not log all my trades here. I only describe or mention those that I think might be interesting. Consult an investment professional familiar with your specific financial situation before buying or selling any security.

Life and Money

David Neubert — 2007-01-26T15:39:00Z

Life is about an accumulation of experiences, not an accumulation of money.

A Four Year Old's Take On War.

David Neubert — 2007-01-25T17:47:00Z

Found this little tidbit on the website of a woman from New Jersey (Kate of Hoboken) who lost her husband and wrote a lot about it.

What follows is her four year old son Bucky's take on war:

ONE DAY

BUCKY Do you know why there is war ma?

MOM No Bucky, why?

BUCKY Because the good guys and the bad guys wanna make
more money.

A FEW MONTHS LATER

BUCKY There is a new kind of war.

MOM Why kind is that?

BUCKY You don't know who the bad guys are.

http://www.kateofhoboken.com/Bucky_On_War.html

Year End Bounce Trade Gone Wrong With Vonage (VG)

David Neubert — 2007-01-24T05:16:00Z

I bought Vonage (VG ) at the beginning of the year as (documented on my personal blog - Jan. 3 2007 paid $6.65 - now $5.85) expecting the shares were the victim of tax loss selling and that I'd see a big snap back as soon as those who bought the stock at the IPO for $17, sold to recognize tax losses and offset gains. While sellers may have been hitting Vonage it would seem no such snap back was anywhere to be found. I'm still holding while I try to get a better handle on the company. The have a business that operates at a positive cash flow once they acquire a customer. It's that customer acquisition that's killing them.

Here's the link to an interesting blog by Eric Savitz of Barrons on Vonage.

Disclosures and Confessions: I own Vonage (VG) as a short term speculative holding. I also have Vonage phone service. At first I found it unreliable, now I find it very useful. I like getting my phone messages as emails and being able use my phone number from anywhere I have an internet connection. In the long run, Vonage has too much competition. Their best hope is to be bought by a huge company with distribution but very customers.

Disclaimer: Nothing in this blog is meant to be specific financial advice or a recommendation to buy or sell. I do not give investment advice. Do your own research. Do not rely on anything in this weblog to make investment decisions. I do not log all my trades here. I only describe or mention those that I think might be interesting. Consult an investment professional familiar with your specific financial situation before buying or selling any security

Ongoing Campaign to Invigorate Yahoo(YHOO) and an Options Strategy

David Neubert — 2007-01-22T15:21:00Z

Eric Jackson's Campaign to create shareholder value at Yahoo (YHOO) continues. He is still small relative to the total size of Yahoo but I hope he will continue to gather momentum. Mr. Jackson is using every tool in the Web 2.0 arsenal; he's created a Wiki for the campaign, flickr group, a YouTube video channel and a of course his blog.

Let me say that I am a Yahoo fan. For years MyYahoo.com has been my browser startup page; I pay to use Yahoo enhanced email; I have over 2000 photos on flickr; I find Yahoo finance to be almost as good as Bloomberg but without the $1800 a month pricetag; I have even been using Yahoo's search recently and find it so greatly improved that I don't need Google as much.

In expectation that this campaign might gather more momentum and seeing that it is getting more press coverage, I recently added to my Yahoo (YHOO) position through a buy/write. On Jan 17th I bought Yahoo shares at $28.97 and sold Jan 2008 35 strike calls for $1.95. I have a net cost at expiration of $27.02 and will not have any upside beyond $35.00. (As of today Jan 22, Yahoo has fallen to $27.50 and the options to $1.50. This same buy/write could be had today for a much better net price of $26.00.)

I did a technocrati search for my blog and found coverage on the Plan "B" campaign from Publicidad y marketing en la red, a Spanish language blog. My first appearance in Spanish.

Here are the stats on Eric Jackson's Plan "B" for Yahoo taken from his Breakout Performance Blog.

Yahoo! "Plan B" Group Stats: As of 1/20/07

"Plan B" Advocacy Launched: 1/7/07
Current YHOO Shares Owned: 90K
Current YHOO Shares' Value: $2.4MM
YHOO's TSR since Launch: -0.36%
GOOG's TSR since Launch: 0.53%
NASDAQ's TSR since Launch: 0.70%
Relative Shareholder Value Created to GOOG: ($21,706)

Finance Industry vs. Hollywood

David Neubert — 2007-01-21T22:28:00Z

Some business associates from the film industry were talking about financing film credits and asked me what I thought about a conversation they'd had at The Sundance Film Festival going on right now in Utah.

Here's what I said:

"I worked in finance for fifeteen years and there is a huge competition for the BS factor with Hollywood going on. 'Yes, we can do that deal' before you see a term sheet is the finance industry's version of 'We'll do lunch.' "

Selling a European Utility Scottish Power (SPI).

David Neubert — 2007-01-17T17:20:00Z

Selling a European Utility Scottish Power (SPI).

With p/e ratios roughly equal to that of the general market I think utilities in the US are vastly overvalued. As a result of the of the recent merger mania among utilities in Europe, I now think same is true of European utilities. On Jan 16^th (yesterday), I sold my long time holding in Scottish Power ADRs (SPI) at $58.43.

Disclosures and Confessions:

I first acquired Scottish Power through my participation in a Dividend Reinvestment Plan (DRIP) at PacifiCorp in the early 90’s. Back then, there were no online brokers, I wasn’t making much money and I saw a couple hundred dollars of monthly contribution to a commission free DRIP as a great way to accumulate savings. Pacificorp was acquired by Scottish Power. The DRIP was terminated, I transferred my shares to my online broker then purchased more shares of Scottish Power ADRs. In 2005 Berkshire Hathaway purchased PacifiCorp from Scottish Power. Oddly, I owned Berkshire Hathaway (BRK/A) then and now. I’ve been benefiting from Pacificorp and its vast hyrdroelectric power generation for over almost 15 years and via three different corporate entities.

As of this sale I have no position in SPI. I own and have traded Berkshire Hathaway (BRK/A) in the last two years.

Disclaimer: Nothing in this web log is meant to be a recommendation to buy or sell. I do not give investment advice. Do your own research. Do not rely on anything in this weblog to make investment decisions. I do not log all my trades here. I only describe or mention those that I think might be interesting. Consult your own investment professional before buying or selling any security.

Follow Up on Imperial Sugar (IPSU): Grandma Gloats About Her Sweet Tooth

David Neubert — 2007-01-11T18:50:00Z

Grandma called from Northern California to let me know that Imperial Sugar (IPSU) announced a special dividend of $3.00 per share. When I wrote my blog entry on September 25th IPSU was trading around $29. I thought the stock was getting too much attention because ethanol prices had driven up sugar prices in the short term and that the stock would eventually suffer when ethanol and sugar prices fell. I couldn't help but tease my 85 year-old grandmother at Thanksgiving as the stock fell to $21. The sugar company is now trading at $26 and holders on December 26th get that extra 3 bucks as a dividend. I'd be at break even today had I bought the stock back in September. I think Grandma must have been watching the stock fall and been frustrated that I went against family - now Grandma has the last laugh.

Like I said back in September, Grandma usually a better stock picker than I am. She held the stock at $21. I guess when you reach 85 you have pretty good instincts. I'd be happy just to make to 85 good instincts or not.

First Call estimates are $2.50 for 2007 and $1.80 for 2008 which gives P/E's of 10 and 14 respectively. Unless we get a pullback (like the one I missed at Thanksgiving), I cannot call this company a value stock.

Disclosure: I do not own Imperial Sugar (IPSU) though I may buy on a price decline. (which I didn't during the last price decline). I love my grandmother and am on her side in most things. I didn't make it home for Thanksgiving to see Grandma this year but I plan to be in California next year for the holiday. Grandma prefers Valueline (those big fat paper books) for her research. I tend to use online resources. Good grandsons do not tease their grandmothers.

Disclaimer: Nothing in this web log is meant to be a recommendation to buy or sell. I do not give investment advice. Do your own research. Do not rely on anything in this weblog to make investment decisions. I do not log all my trades here. I only describe or mention those that I think might be interesting. Consult your own investment professional before buying or selling any security.

Not Enough Executives Have Gone To Jail Says Berkshire Hathaway's Charlie Munger

David Neubert — 2007-01-10T04:02:00Z

The Inelegant Investor Summarizes Munger's Comments to the LATimes:

Munger derided compensation consultants, declaring that “I have always said that prostitution would be a step up for these people.” Munger pointed out that the problem was not that CEOs were evil, but that “… envy-driven compensation mania … brings out the abosulte worst in good people.”

Disclosures and Confessions: I own Berkshire Hathaway. (BRK.A ) I sometimes eat at Dairy Queen which is owned by Berkshire Hathaway.

Yahoo (YHOO): Individual Activist May Shake Up Yahoo

David Neubert — 2007-01-09T22:49:00Z

Sorry Warren Buffet, I still love you but Eric Jackson is my new investor hero. This guy is leading a campaign of individual investors from his blog to push for a restructuring of Yahoo (YHOO ) for the benefit of shareholders. In his blog and embedded video posted on YouTube Mr. Jackson describes a ten point plan to increase returns for shareholders and remind Yahoo Management who they work for. He then asks shareholders to either buy shares or use their current holdings and commit to vote them with his proposals.

This is shareholder activism at its most democratic level.

Congratulations Mr. Jackson, you are my new investing hero. Now if only you had $37 billion to commit to philanthropy.

The seven point plan is very reasonable:
Mr. Jackson even proposes creating the plan in a wiki . That may be a bit far-fetched as an idea but I support his radical idealism. You never know what kind of shareholder democracy, added value and profits to shareholders may ensue.

1. Appoint Susan Decker CEO immediately; implement pay-for-performance for all YHOO execs going forward.
2. Restructure the board immediately with more active outside directors who own stock; 10 year term limits for directors should also be introduced.
3. Set up a special committee of the board to study and then articulate the company's vision/strategy and start executing it.
4. Step up the pace of the $3B stock repurchase plan announced in October 2006.
5. Begin a cash dividend immediately.
6. Reduce overlapping internal divisions (e.g., del.icio.us/MyWeb, Flickr/MyPhotos.)
7. Remove anti-takeover provisions which are not shareholder-friendly.

My comments on his plan:
1. Why Susan Decker as CEO? I would want to know what he means by pay for performance. He should probably explain that. I hope it has earnings and cash flow targets instead of just share price.
2. Amen
3. More Board involvement is better.
4. Amen.
5. Dividends instill discipline on management. But a small dividend. This company still needs to invest cash in growth.
6. Why has this taken so long?
7. Always a good idea.

I plan to support the proposal with my shares. I agree with most points and I'm happy to support the little guy.

Disclosures and Confessions: I own Yahoo and plan to pledge my shares to the campaign. However, if the shares rise above $35 I'm likely to start selling. I'm short Jan 2008 35 strike calls against half my position of YHOO and am also short Jan 2008 30 strike puts. I like Yahoo!. I use their email and use MyYahoo as my homepage. I make extensive use of Yahoo Finance . I also like their newsreader in yahooMailBeta. I also own Mr. Buffet's company Berkshire Hathaway. (BRK.A )

Closing Out Mastercard (MA): I'd Rather Be Early Than Worried

David Neubert — 2007-01-08T23:35:00Z

In early June, I bought Mastercard Inc. (MA) at around $47.00. I thought I was buying a stock with a forward p/e of 15 which compared nicely to American Express (AXP) at the time. That seemed low and I thought that the stock deserved a p/e multiple of closer to 20. I sold half my position in November at $89.46. Today, I sold the rest at $101.40. Both August and November had positive earnings surprises that helped goose to the stock to a forward p/e of 23 according to First Call estimates. I might be early, but I've ridden this profit rocket long enough and am ready to look for better values.

Prospects for continued earnings surprises? Well, Mastercard is in a business that should be competitive but is not. The big three (four if you include Discover Card owned by Morgan Stanley (MS), have managed to keep vendor fees very high. It's amazing that they have been able to do so as they are in an information and telecom processing business. Every other information processing business has suffered margin compression. Good for them to be able to continue sticking it to retailers and keep fee high (and by proxy, their customers) but at some point this will become an endangered margin and then, watch out. I would rather bet on companies where technology expands margins rather than hope that oligopolistic behavior in the face of telecommunications advances and the internet may endanger margins.

Disclosures and Confessions: With this sale described above I own no Mastercard Inc. (MA). I have traded Mastercard in the last two-years. I may buy back Mastercard depending on price action and earnings but I currently have no intention at current prices. I had to check my wallet to see if I have a Visa or Mastercard logo on my bank credit card since I can't tell the difference between the service anyway. And yes, I have to have an American Express Card too just in case somebody doesn't take Visa/Mastercard. I had a Discover Card but it was hard to use. And who needs that many cards anyway?

Disclaimer: Nothing in this blog is meant to be specific financial advice or a recommendation to buy or sell. I do not give investment advice. Do your own research. Do not rely on anything in this weblog to make investment decisions. I do not log all my trades here. I only describe or mention those that I think might be interesting. Consult an investment professional familiar with your specific financial situation before buying or selling any security.

Exxon Most Disliked by Scientists (and Overpriced) Of The Oil Companies

David Neubert — 2007-01-04T17:59:00Z

ExxonMoble (XOM) gets caught trying to suppress science on climate change and hurt the planet for profit. (See Reuters article) I had a link to the ExxonMobile response but they seem to have taken it down from their website on Corporate Citizenship.

I want exposure to the oil, gas and energy industries. Energy will only get more important as China and India continue to industrialize and become consumers. But Exxon is not the best way to play this exposure. At a p/e of 11.1 and a growth rate no better than other huge oil companies I can find better value and better morals (if only slightly sometimes) picking other energy companies. The oil companies and the trailing P/E ratios of companies I do own are as follows:

Conoco Phillips (COP): 6.4
Occidental Petroleum (OXY): 8.0
Andarko Petroleum (APC): 5.2
Chevron (CVX): 8.9
BP - ADR formally British Petroleum (BP): 9.8
Statoil (Norwegan State Oil Co) (STO): 9.6

If Exxon were a real bargain, I'd hold my nose and buy it. Then I'd vote my proxies with some of the shareholder resolutions bent on trying to get Exxon management to behave themselves.

Disclosures and Confessions: Except for Exxon (XOM) I own and have traded in the last two years) all the stocks named above. If I were to sell any of the oil companies named above it would be Statoil first.

Disclaimer: Nothing in this blog is meant to be specific financial advice or a recommendation to buy or sell. I do not give investment advice. Do your own research. Do not rely on anything in this weblog to make investment decisions. I do not log all my trades here. I only describe or mention those that I think might be interesting. Consult an investment professional familiar with your specific financial situation before buying or selling any security

Best Ever Disclaimer

David Neubert — 2007-01-04T17:32:00Z

David Andrew Taylor, currency trader and blogger at dismally.com has the best disclaimer I've ever seen. I try to be painfully honest and even funny in my "disclosures and confessions" but this guy wins. I wonder what law firm he used to write his disclaimer?

His Disclaimer begins like this:
I have never made money in the markets. If you follow my advice, that is akin to strapping on a a piece of fishing line to your ankles and trying to bungee jump off a 1,000 foot bridge..... (read the rest)

Year End Buys (HD, AMGN, APC, YHOO, VLCCF, LRT, SIRI, VG)

David Neubert — 2006-12-31T04:11:00Z

Holiday parties, working on ThePanelist.com and family visits have curtailed by writing but not my trading. Here's a list of value stocks that I picked up at year. These stocks seem cheap either because they are out of favor, the victims of year end tax selling, or simply value that I think will come back with the New Year when value managers start going over income statements and running screens again.
by neubie photo by a.a.
I bought all of these names for myself or for friends in the last week of the year.
Yahoo (YHOO) $25.51
Home Depot (HD) $39.90
Amgen (AMGN) $68.40
Andarko (APC) $43.79
Knighsbridge Tankers (VLCCF) $23.45
L L E Royal Trust (LRT) $2.74
Sirius (SIRI) $3.76
Vonage (VG) $6.98

Disclosures and Confessions: I own all the stocks named above. SIRI and Vonage (VG) are short term speculative holdings. YHOO, HD, AMGN, APC, VLCCF and LRT are longer term value investments.

Disclaimer: Nothing in this blog is meant to be specific financial advice or a recommendation to buy or sell. I do not give investment advice. Do your own research. Do not rely on anything in this weblog to make investment decisions. I do not log all my trades here. I only describe or mention those that I think might be interesting. Consult an investment professional familiar with your specific financial situation before buying or selling any security

The Amazing Volkswagen Beetle

David Neubert — 2006-12-26T03:53:00Z

This Amazing car and I have a lot of history together. My mother got it in 1965, the year of my birth. As a toddler, I used to beg to ride in the cubby hole in the "way back". In Pacific Grove, I used to play house with Stacy Spung when we were five. In 1981, I learned to drive in this car. It has been sitting in my uncle's yard in the San Francisco Bay Area since 1990.

This car, designed in the 1930's and built in the 1965, has lasted so long. (This car hasn't even been taken care of - notice the pan under the front passenger seat. If American auto makers had been so innovative, Ford and GM probably wouldn't be in so much trouble.

Click on the photos to enlarge them in flickr.

Buying An Insurer: I'm Afraid Of Global Warming But Chubb Isn't

David Neubert — 2006-12-18T08:29:00Z

Photo by Rahull J Young via Creative Commons and Flickr

I had to add to my Chubb (CB) position. This property and casualty company is so cheap at a p/e of 8. They've had this low p/e for years as the stock has climbed. People are worried that global warming and terrorism mean that there is another unexpected disaster out there that will hurt insurance companies. While global warming is bad for me, you, the planet, the oceans, all the species that will go extinct and ski resorts; global warming will not hurt the insurance industry. They are pricing global warming into their policy prices and actuarial models. The market is wrong to think that global warming will hurt insurers.

Another plus in Chubb's favor is their ongoing share buyback. They realize the stock is cheap and are rewarding those shareholders who hang on.

Disclosures and Confessions: I own Chubb. I have owned CB for over 2 years. I insure my NY condo with Chubb. Their insurance is expensive but I hear the have a reputation for being very quick to pay when the time comes. I have never made a claim against my Chubb insurance policy. I also own Berkshire Hathaway (BRK/A) for many of the same reasons mentioned above.

Wait 'Till Winter: Taking Profits On IAC (IACI)

David Neubert — 2006-12-11T16:14:00Z

I posted this entry on July 24th, 2006 (Wait 'Till Winter) on buying semi-conductors and online retailers in the summer and waiting for winter. That week I made the following buys in anticipation of a winter rally:

$24.75 for IAC/Interactive (IACI) - now $36.67
$17.39 for Advanced Micro Devices (AMD) - now $20.80
$17.10 for Intel (INTC) - now $20.84

Last week, I sold part of the IACI position at $36.64 and sold Jan 2008 37.5 calls against another part at $3.90 each. At a p/e of 38 trailing and forward of 18, the stock seems fairly valued. Though I'm still looking for a decent pop going into the year end and I left another part of the position unhedged to sell in January.

While I have a nice profit in both AMD and Intel, I do not feel they are yet ready to be sold. At p/e's just under 20, the stocks seem fairly valued but there always seems to be a tech/semi-conductor euphoria in January. I'm going to wait for that buying panic to set in. I love to sell to panic buyers.

As for Microsoft (MSFT), priced on July 24th at $24.00 now $29.65, I said that the impending release of Windows Vista would push the stock higher into year end. The push is on buyers have not yet pushed the beheamouth software maker as much as I thought. I sold April 30 strike calls at $1.20 against part of my position last week and have a target sale price somewhere above 30. See (Where Is Microsoft Top?).

Disclosures and Confessions:

I own IAC/Interactive Group (IACI), Intel (INTC), AMD (AMD) and Microsoft (MSFT). I am short April 30 strike calls against part of my Microsoft position. I am short Jan 2008 37.5 calls against part of the IAC position. I may sell any of these positions at any time if there is a price spike. I have been trying to use Ask.com (owned by IAC) for searches to see if it is any better or worse than Google.com. I have found it about the same. I think ask.com is a little better for looking up people. Google is much better for looking up businesses.

Disclaimer:

Nothing in this blog is meant to be specific financial advice or a recommendation to buy or sell. I do not give investment advice. Do your own research. Do not rely on anything in this weblog to make investment decisions. I do not log all my trades here. I only describe or mention those that I think might be interesting. Consult an investment professional familiar with your specific financial situation before buying or selling any security.

A Better Brand Of BS From A Little Utility Company

David Neubert — 2006-12-07T04:01:00Z

Central Vermont Public Service Corp (CV) is an interesting utility. Though I don't own it right now, I've owned it on and off over the years. Like most Vermont companies they are pretty innovative when it comes to the environment. They currently have an interesting program around recycling cow manure to make electricity. Farmers are paid a premium and the earth is saved from methane.

"To create energy, manure and other farm waste are held in a sealed concrete tank at the same temperature as a cow's stomach, 101 degrees. Bacteria digest the volatile components, creating methane while killing pathogens and weed seeds. The methane, which is roughly 20 times more effective than carbon dioxide at trapping heat in the atmosphere, fuels an engine/generator, and the electricity is fed onto the CVPS electric distribution system."
CVPS Cow Power Website

CV is a slow growing company, with p/e of 13.5, and a dividend of over 4%. Central Vermont PS is not cheap but not expensive either. I'm underweight utilities because I think long term interest rates will eventually go higher, hurting the sector. CVPS is small and subject to event risks like winter freezes. But I may add a small amount of this little power distributor/generator back to my portfolio. I like making a little money off some real "Bull Stuff" and hot gasses.

Disclosures and Confessions: I do not own CV but may buy it in the next few days depending on price. I have traded CV in the last two years. I have worked, advised and volunteered at Coutts-Moriarty Camp in Derby Vermont. The smell from the nearby dairy farms could be quite overwhelming at points and I often wished that all that those odorous gifts of our bovine friends could have been put to a better purpose than clogging my olfactory senses. However, no cowpower was forthcoming and I did not use electricity generated by cow power.

Disclaimer: Nothing in this blog is meant to be specific financial advice or a recommendation to buy or sell. I do not give investment advice. Do your own research. Do not rely on anything in this weblog to make investment decisions. I do not log all my trades here. I only describe or mention those that I think might be interesting. Consult an investment professional familiar with your specific financial situation before buying or selling any security

Where Is The Microsoft (MSFT) top? Getting Ready To Pull The Trigger.

David Neubert — 2006-12-06T10:11:00Z

I'm starting to think that Microsoft (MSFT) is reaching the top of it's valuation($29.35). Perhaps we get a bit of a kick up into year end that will prompt me to sell. I'm not selling right now but I'm looking to sell April 30 calls against about a quarter of my position. When I picked up the position in the summer (between $23 and $27) I was looking at just above 30 as my target price. At a p/e of more than 20 against next years earnings, I'd be ready to sell.

Stock Traders Daily, Thomas Kee, sets out all the arguments to short MSFT. While I'm not ready to short MSFT unless I see both huge overvaluation (not yet the case) and downside momentum, his arguments for shorting present good reasons to be ready to sell.

Here are the search results for my entries on Microsoft.

Disclosures and Confessions: I own Microsoft (MSFT) at what I consider a full position. I currently have outstanding limit orders to sell 30 strike call options with various expirations above the current market. I do not own an XBOX though I think it's the best of the game platforms I've seen. I have friends that work at Microsoft though I really don't talk to them about the company ever. I like that Bill Gates has made a huge committment to philanthropy at such a young age.

Disclaimer: Nothing in this blog is meant to be specific financial advice or a recommendation to buy or sell. I do not give investment advice. Do your own research. Do not rely on anything in this weblog to make investment decisions. I do not log all my trades here. I only describe or mention those that I think might be interesting. Consult an investment professional familiar with your specific financial situation before buying or selling any security

Charitable CEO Pay Shows Growing Gap In Humanity and Greed.

David Neubert — 2006-11-30T18:12:00Z

An article on the growing disparity between charitable organization CEO's and large corporate CEO pay. The article, by Harvy Lipman, is from Business Week Online but first appeared in The Chronicle of Philanthropy.

Why are heads of charitable organizations salaries growing more slowly than the CEO's of large corporations?
1. Donors watch how their money is spent much more closely than shareholders.
2. Big Corporate CEO's have less shame about their greed.
3. Philanthropic CEO's have enough awareness and humanity to accept that the returns they receive for their talent are way beyond money. I feel sorry for the narrow minded Corporate CEO.

A message to Philanthropic CEO's who compare their pay to large corporations.
Almost all major philanthropic organizations pay six figures to their CEO. If some charitable organization Executive Director/CEO needs a salary competitive with big corporations - please leave the world of philanthropy - I doubt you'll be able to do a good job or identify with your grantees and the good work of your organization.

Something my brother-in-law told me when I was fretting about leaving my exceedingly high paying job in the corporate world.
"It is easier for a camel to pass through the eye of a needle than for a rich man to get into heaven"

If I replace "into heaven" with happiness and contentment this quote from the Matthew 19:24 still makes sense to us secular humanists. It was very good advice.

Currency Down Market Up. Monday's Move Is Not Normal For The Medium Term

David Neubert — 2006-11-28T02:15:00Z

The US dollar declines and the US market is down. This is the exact opposite of usual medium term effects that occur when currencies move.

The Neubert Experience:
I was trading Mexican equity derivatives in 1994 during the Peso currency crisis, I was trading Brazil (equities, futures and bonds) during many of their currency crises in the 1990's. I was trading emerging market debt in 1992 when the UK Pound broke from the ERM and fell. In every case, where these currencies fell the local stock market indices were up relatively quickly.

Why do do markets go up when currencies fall?
1. Exporters are looking to make more money
2. All assets look cheaper for foreigners relative to their own stock markets so they can buy
3. A falling currency often means good news for pricing power of domestic companies as foreign products (denominated in a foreign currency) go up.
4. In general, a falling currency means inflation for end product prices but not necessarily of product inputs. Inflation, while it may mean higher interest rates, almost always means better pricing power for corporates. (this is a little related to point #3).

So why is the US market down today as the dollar hits recent lows?
Even though Since the 80's Republican governments (Regan and Bush Jr. ) like to borrow and spend like a the Latin American Economic Disaster Governments of the 70's and 80's the US is still not yet treated as a third world country by the rest of the world. But, because the short term reaction is over a short term lack of confidence in the US - foreigners sell stocks and the dollars they used to buy them in the first place. This is a very short term view - and both the market decline and currency decline have both been quite small so far. The market is down Monday because it's is falling under its own weight created by the recent run up. The recent decline in the dollar is just the short term excuse. If the dollar were to really drop, watch out for an increase in the US stock market indices. The US is not suffering from an overall global crisis of confidence. If it was, we'd see long term interest rates skyrocketing - and we are not.

Disclosures and Confessions: I am painfully short US bonds and betting on an increase in long term interest rates. I am long Yen vs. Short USD. I try to diversify my portfolio not just by sector but also by currency and country. I do not believe I (or anyone) should have all their assets in US equities. I also like and own US equities that benefit from a dollar decline. If you've been reading this column for a while you know which equities those are.

Disclaimer: Nothing in this blog is meant to be specific financial advice or a recommendation to buy or sell. I do not give investment advice. Do your own research. Do not rely on anything in this weblog to make investment decisions. I do not log all my trades here. I only describe or mention those that I think might be interesting. Consult an investment professional familiar with your specific financial situation before buying or selling any security.

Found The Old Starbucks Logo - Too Sexy For It's Day

David Neubert — 2006-11-23T23:29:00Z

Found this interesting blog entry on the changes that happened at the Starbucks logo to make it less sexy and more mainstream. The first full body mermaid/siren must have offended somebody so we only get her bust now.
See Blog From Dead Programmers' Cafe on The Starbucks Siren

Oh, my opinion on the Starbucks (SBUX) the stock? It's expensive, it stays expensive. And Starbucks keeps turning in phenomenal growth. I have bought it over the years in a hug pullbacks then bail out as soon as the stock recovers. This is the the classic, "I wished I owned it but am too chicken to pay a huge multiple" stock. But I keep selling it thinking I can pick up better value elsewhere. At somepoint Starbucks will become like McDonalds (saturated, resented, hated, a symbol of bad health and growing slowly) and growth will be difficult to find. But for now, they have a great product:
1. Their product is legal
2. Their product is addictive
3. They provide one of the only remaining public places for community that remain after big box stores like Walmart and Home Depot come in and wipe out downtowns.
4. China likes coffee
5. Every time they open a store people crowd in.

So heck, I will try to buy the stock if it ever has a pullback - until that time I can find other values around.

Disclosure and Confessions
I am short puts on SBUX. The stock has to drop by 50% to make these puts have any value.
I have owned and traded SBUX in the past two years.
I avoid buying coffee/lattes at Starbucks whenever possible, but this is not always possible. I do not think they are a particularly evil company I just like to promote diversity whenever possible and since Starbuck represents standardization of culture I try to avoid them. I even like their coffee, I just would rather support small cafes like Grounded on Jane Street in Manhattan's West Village.
I own Wal-Mart (WMT) thought I also avoid shopping their. But darn they sell stuff at a good price.

Photo by Heath and the BLT Boys

Photo by: http://www.flickr.com/photos/nstark/260197635/

Disclaimer: Nothing in this blog is meant to be specific financial advice or a recommendation to buy or sell. I do not give investment advice. Do your own research. Do not rely on anything in this weblog to make investment decisions. I do not log all my trades here. I only describe or mention those that I think might be interesting. Consult an investment professional familiar with your specific financial situation before buying or selling any security.

David Neubert

CIT - Saving Money After The Bankruptcy

Brother Jimmys Named as Up and Coming Franchise

David Neubert Video Appearance on Fox Business News from February 2008

Napping At The Office

Short Films on Cycling

A New Toy: Sport Flying

When Everything You See Seems Relevant

Tell Me Some Way

Radio Netherlands

Blogger Table At Bourbon and Branch

Almost Lost My Blog At Godaddy

More Content about Inflation, Bernanke and Interest Rates at ThePanelist.com

Men, Women, Money and Neubert on Lime Radio at Sirius

Playing Intel (INTC) as a Value Stock But Using an Options Cocktail

Neubert on Lime Radio at Sirius.

Selling Verizon (VZ) to Make Room for General Electric (GE)

A 12-Step Program for My Citigroup Addiction

Nevada versus Massachusetts: Burning Man versus Freezing Man

Cut One-Third of My Exposure to the Japanese Yen.

Adding to Home Depot (HD)

Buying Amgen (AMGN)

New York Times (NYT): Read The Paper, Sell The Stock

TXU

Selling Gold Futures Holding Global Gold Miners

Selling Half My Stoneridge Inc (SRI)

Seaspan Corp (SSW) Reacting To A Rating Cut By Lazard

Strong 30 Year Treasury Auction: No Big Deal

Looking For Stocks to Sell? Pfizer (PFE) is not One of Them

Yahoo Blows Away Google in Time Spent Online But Not On Valuation

A Liberal Op/Ed on Forbes

Life and Money

A Four Year Old's Take On War.

Year End Bounce Trade Gone Wrong With Vonage (VG)

Ongoing Campaign to Invigorate Yahoo(YHOO) and an Options Strategy

Yahoo! "Plan B" Group Stats: As of 1/20/07

Finance Industry vs. Hollywood

Selling a European Utility Scottish Power (SPI).

Follow Up on Imperial Sugar (IPSU): Grandma Gloats About Her Sweet Tooth

Not Enough Executives Have Gone To Jail Says Berkshire Hathaway's Charlie Munger

Yahoo (YHOO): Individual Activist May Shake Up Yahoo

Closing Out Mastercard (MA): I'd Rather Be Early Than Worried

Exxon Most Disliked by Scientists (and Overpriced) Of The Oil Companies

Best Ever Disclaimer

Year End Buys (HD, AMGN, APC, YHOO, VLCCF, LRT, SIRI, VG)

The Amazing Volkswagen Beetle

Buying An Insurer: I'm Afraid Of Global Warming But Chubb Isn't

Wait 'Till Winter: Taking Profits On IAC (IACI)

A Better Brand Of BS From A Little Utility Company

Where Is The Microsoft (MSFT) top? Getting Ready To Pull The Trigger.

Charitable CEO Pay Shows Growing Gap In Humanity and Greed.

Currency Down Market Up. Monday's Move Is Not Normal For The Medium Term

Found The Old Starbucks Logo - Too Sexy For It's Day