Vanity Fair article on Merrill

Here is a Vanity Fair article on Stanley O'Neal, Merrill Lynch's former CEO. It shows the level of intensity that greed can take hold on an ambitious person in a bad way.

Great article on Jamie Dimon

The New York Times has published an article (below) on Jaime Dimon that is worth reading

Jamie Dimon Article

Enjoy!

Best Quarter Ever

I am disheartened by the fact that as the working people (including you and I) of this country are going through tough economic times, corporations and their stockholders (to include me and you through retirement and other holdings) are enjoying record profits.

I guess the question is what do we do about it as citizens and shareholders at the same time?

The New York Times story below spells it out.

Largest Quarter Ever

Happy Thanksgiving!

Bank of America Mortgage Securitization Problem

There is a big problem brewing at Bank of America. It turns out that some mortgages that were thought to be securitized actually were never given to the trustee. The story below from Abigail Field through AOL Daily Finance explains this issue in better detail.

B of A/Countrywide Mortgage Problem

Banks close to doing right

After reading this story below, it makes me wonder again, how much better financially the country would be if they EVER did the right thing instead of the most profitable thing. Their blatant disregard at times while receiving that ridiculous sum of tax money is unbelievable. When will they realize they just have to own up, take the hurt that is coming to their company quickly, and move forward.

But then again, that would hurt their stock price, which reminds me of another company worried about its stock price..........It is no wonder Jeff Skilling is hopping mad about having to be in jail while these executives still are working and receiving million dollar bonuses.

CNBC foreclosure story

Retail Sales show positive

Retail Sales show that the consumer was in a better mood last month in a New York Times story below. The encouraging part of this report is the growing strength big ticket item purchases.

October Retail Sales

Important jobless claim number

The jobless claims came out today and the long term number was telling. It is lower than the point just before Lehman Brothers troubles. The Yahoo Finance story is below.

Jobless story

productivity slowing = hiring????

Here is a story from CNBC below discussing how slowing productivity numbers might give a push towards hiring. This is about right as productivity is close to all time highs.

Productivity/Hiring

Solar Stocks

Solar stocks are in a bullish mood right now.

Google wealth vs. Microsoft wealth

Last week there was a conference at Northeastern Illinois University last week centered around the use of technology. The speakers of the conference were from Google's Chicago office, You Tube, and Motorola.

There was something I noticed very interesting before the You Tube presentation was about to begin. The You Tube executive was using an IPhone! Now, I don't know the specifics of what restrictions Google employees are put under as far as product usage, but using another company's products would not happen with Microsoft. This is a shift from the Microsoft model of employee product usage.

It is well known that Microsoft employees are required to use the Microsoft version of any product if available. The Gates family has been regularly asked by the press if any carry an Apple product and always answering that they use Microsoft products.

The YouTube employee using the IPhone (made from Apple) is in direct competition to its Google phone products. The guess is that the execs at Google, while still wanting their employees to use its products, allow them to freely choose to use whatever products they like without trouble.

The fuse has been lit

This economy has the real opportunity to roar back in 2011. The GDP numbers were up an annualized 2%. This is great news considering the fact that corporations in the S&P are holding on to $1 trillion dollars and not hiring! It is not normal to find positive GDP without hiring or spending by corporate America.

There is a feeling that once the mid term elections are over, there will be more certainty as to how governmental economic policies will be shaped. That alone will allow corporations to act and start hiring again.

New Follower

Wikiwealth would like to welcome Win$Win to the group. Hopefully you can find some useful information on this blog!

Intel building new plants

Hey

The Associated Press wrote a story on how Intel will be spending $8 Billion to build new plants the next generation chips in the United States. The story is below.

Intel plants

Silent Obama Tax Cut shhhhhh

Hey

For those of you who didn't know, 25% of the stimulus was given away in tax cuts. Here is a story (below) in the New York Times detailing how most Americans didn't even realize they received one even though they are railing against the evils of said stimulus.

Pass this on as I am sure there are people you know that fit this profile and might not know where 25% of the stimulus actually went to.

Obama Tax Cut

Profit at wikicallselling!

Hey

The account over at Wikicallselling just reported a profit of over 21% in its most recent trade. The trade lasted a total of seven months. It used the strategy of buying shares and then selling calls against those shares. The stock used for the trade was Exact Sciences Incorporated.

Amazing article on bank failures

Hey

Daniel Gross has written an exceptional article analyzing bank failures in the last few years.

Enjoy!

Good Article on job creation

Here is a very good article on job creation from Dan Froomkin.

Job Creation

Enjoy!

Article on Profits or Hiring

William Arden has written an article for The Huffington Post that outlines the fact that companies making up the S & P will make $189 billion in the past quarter.

This shows a sense of greed and fear. It also seems to show a laser focus on the short term and almost no focus on the long term.

Leave it to Kids

Hey

AP reported that Toys R Us announced they will double their workforce for the holiday season. It is nice to know that a store for kids has become a leader in hiring and doing their part to get us out of the recession. Paging the rest of Corporate America, your table is now ready!

This blog does not have any relationship with Toys R Us other than now knowing where it will shop for the holiday season and beyond.

book purchase experience

Hey

For a class I am currently taking on Futures and Options, I had to purchase "Money Management for Futures Traders" by Nauzer Balsara.

I purchased the book on line using Amazon.com Marketplace. The book shipped from Windsor Books in New York. The book was priced right, and shipped in a timely manner. If there is a need to buy some books online, consider using Windsor through Amazon.com.

Rockefeller example

Back in the depression, there was one person (I'm sure not the only one) who saw the need for hiring, the need for building, and the need for leadership.

Strangely, the person I'm speaking about is John D. Rockefeller Jr..

The family owned a property in mid-town Manhattan when the depression hit. Rockefeller did something with this property that many big corporate executives of the time were unable to do. He decided that instead of hunkering down and keeping all of the family money, he would take a chance and develop the property. In the end, the project hired over 75,000 people. He was also able to convince other corporations like RCA to participate in the development the property. His vision to develop the property helped middle to lower economic class Americans. Together, the people working on the project not only built an American icon, it assisted a little bit in helping America get out of the depression.

The property is Rockefeller Center.

It would be nice if companies and wealthy entrepreneurs of this time would look to this example when wondering whether or not to hire. There is plenty of money out there. It is just being kept hostage because of fear and greed. The holders' of capital need to show some faith and get some projects going. The government can't be the only entity hiring.

arbitrary coherence

I started reading Daniel Ariely's Predictably Irrational, and the topic of Arbitrary Coherence was brought up. In the book's words, "Although initial prices can be "arbitrary," once those prices are established in our minds, they will shape not only present prices but also future ones (thus making them "coherent"). " With this being said, I am looking at stock prices a little more carfully with the focus being on the relationship between a company's stock price and its true value. If there is a significant difference, is arbitrary coherence a reason? Can understanding the topic of Arbitrary Coherence make a person a better investor or trader? I think so.

Comments welcome.

Banks will be lending soon

It looks like the retail banks will begin lending more in the near future. There are a few reasons for this idea. The banks' last quarter's earnings showed a lessening of loan losses. The banks' trading gains have also come back to earth now, eliminating that outlier. Companies also will be looking to expand their business as their balance sheets are cleaned up and their efficiencies are almost at an all time high.

The banks loan loss totals are getting smaller. This is obviously a positive for the banks in a couple of ways. Primarily, the banks can lessen the amount of money they hold back in order to cover loan losses. Last quarter, the banks used this money to pad earnings. But this is a bad long term strategy and can not be used for very long. The banks also have to replenish the amount of actual loans that were dramatically lessened in the last three to four years to their balance sheet. Consumer credit is increasing, allowing banks to feel more comfortable lending. Businesses have straightened out there balance sheets and set up their businesses to grow.

The ridiculous trading profits that were provided by the government funding through TARP is basically over. The market will not increase 50% like it did in the last two years. This will force the banks to find other forms of revenue in order to keep their shareholders happy. Lending is something that the banks are rumored to do from time to time.

Companies will have to expand their business in order to grow their profits. The ability to cut more is almost over. Production is quite high right now. Their balance sheets are set up to handle loans. They will be looking to the banks in order to provide loans to expand their business.

Chasing wealth

There is a trade I want to make but I would need to break away from my plan in order to get in now. This is where discipline is important. It is important to work the plan.

I thought I would be in the trade two weeks ago but the stock has moved up to a point where even if it stays at this price, it will still be a week or two before I can get in.

For information on the trade, you can go to my call selling blog.

- If you enjoy this blog, please feel free to follow and let others know about it.

Use of tech to build wealth

For the first time today I used Optionsxpress' droid app to place a trade. I was able to do it during lunch since I was away from a computer.

Technology can be a great way to become a better investor/trader. But these tools should be used after plenty of background work has been done.

So take some time and get to know the tech tools out there. They might be able to help you become a better investor/trader.

Dell did WHAT?!!!

Take a look at what Dell did. That is scary and should be a red flag for any investor. There are probably safer investments out there. Management really screwed up.

New York Times article.

bank earnings and your safety

Hey

Earnings for the previous quarter revealed something very interesting and transparent about the big banks and how they continue to make their money. It is primarily through trading and not through banking activities such as lending. Overall, loan losses were down this quarter at the major banks which should provide a boost to their stocks. But the banks' slowdown in trading and other activities had them lowering earnings levels for the quarter.

The New York Times came out with an article stating how banks such as Citigroup and Bank of America took big hits because their trading desks made less money than desired. JP Morgan Chase released good earnings because they released funds meant for possible loan losses. And anyone who thinks Goldman Sachs is a retail bank needs to explain it to me. They are an Investment Bank that had to switch to retail when the crash occured.

As mentioned before, all of these banks were able to pad earnings this quarter with money previously designated for loan losses that didn't occur. This is not a good development. Why didn't they loan the money out instead? This type of action either shows a lack of confidence in the US economy and you as a possible loanee or they are worried about their stock price and put that above helping to drive the needed growth in the U. S. economy. Son't be surprised if it is the latter.

Where are the loans? We gave these firms 700 billion dollars not just to trade and make money for their shareholders but to be a partner in bringing the economy back by making loans to deserving Americans and their businesses that create jobs. The interest received from those loans is a mere pittance for the government and the country as a whole compared to the long term earnings the government would receive in payroll and other taxes had the banks loaned that money out to deserving businesses instead of trading it.

These activities by the mega banks has brought on a movement of going to local banks because people (myself partially included) know they will see their money in work in their communities creating jobs and revenue. This movement needs to continue to grow until the big banks get the message that not loaning money out to deserving businesses is not acceptable. You will hear the banks say their clients are afraid to expand and at the same time hear those same clients complain about a restiction in credit from banks. I believe the businesses, not the banks.

This post is not a desire to eliminate the big banks. They have some great financial products and an important role in the U.S. economy. It is to get them to realize that there is a public needing its partnership to expand our economy.

Paying off the big bills

Hey



Recently someone I know mentioned that they are finished paying off their car bill. This is a big step in wealth building. Now they will be able to put at least a percentage of that money towards savings or towards paying off another bill.

Congrats!

Commissions

Recently, one of my brokers lowered its commissions rates by . This is important as I use this account for trading and will plan to make 25+ trades in the coming year.

Commissions do affect how you invest. You must include those costs when figuring out your returns.

Temptation

Today there was a huge temptation to use some cash designated for another purpose to buy shares in the IPO of the Chicago Board Options Exchange. But cooler minds prevailed and the purchase did not happen.

Discipline is such an important part of investing and trading.

Happy Wealth Building!

China Global Finance again

Hey

So here another couple stories that indicates a shift in importance towards China in the area of global finance. Both stories were found off of Yahoo! Finance.

China Growth

Geithner China Currency Importance

Happy wealth building!

RECOVERY

There is a lot of talk about the European financial crisis and how it could become a contagion and end up causing trouble to the US financial structure. But with the US economy continuing to improve, I am one who believes that the financial crisis in Europe will not have a contagion effect on the US economy.

There are examples of times where financial crisis in other parts of the world had a minimal effect on the US financial system. For example, Russia's currency problems in 1998 devastated a hedge fund named Long Term Capital Management. But the rest of the system was able to circle the wagons and get back to growth. Also, the Asian financial crisis in 1997 was able to be handled by the financial community and the International Monetary Fund.

This is not to say that the US should not be prudent in its analysis of the current problems. They had many more bullets in the chamber than they do now to help. So the financial industry has to be very focused right now. It will take the best financial minds to be at their best to get us through these problems. But there are many indicators showing that the US financial health will still survive the problems in Europe.

Global Financial Leadership shifting

For the past century, the normal headline would have read " Markets stabilize as US makes positive remarks about Europe." But the headline today read "Markets stabilize as China makes positive remarks about Europe." That headline is showing the world how leadership in global finance is shifting away from the US and towards China.

Are we losing our touch or is China simply gaining theirs? I'm thinking it is a combination. Our current financial leaders have shown a personal greed that has endangered our standing at the top. In the last 20 years, China's financial leaders have had a more leadership, less personal profit focus that has put them in a stronger financial leadership position than before. They haven't eclipsed us yet, but it could happen. We need to have a less personal profit, more leadership focus from our financial leaders.

The headline says it all. It would be nice if we could get back to that.

Dividend Stock During Downturn

This downturn should be a reminder to us to look to either start or add to positions that carry high dividend yields. Over the long term, this strategy has done very well. The important step is the research you do in finding stable stocks. A few stocks that I have found to have a high dividend yield compared to their average are GE, Exxon Mobil, Johnson and Johnson, and Kraft. I am sure there are others. Please post what you find.

Refund to people works

I am attaching a Bloomberg story about how Bank of America noticed that credit card defaults went DOWN because of tax refunds. This is a great example of how the government made a mistake giving that money to the banks directly and not the people. When money is given to the people, it tends to end up at the banks anyway in the form of mortgage payments or refund checks thereby not only saving the system, but saving credit ratings of consumers also.

A thank you goes out to Peter Eichenbaum from Bloomberg.

Anyway, here is the story.

Bank of America credit card story

Great Article on B of A

There is a great article on Bank of America's new CEO written by Bloomberg. Congrats to authors Julianna Goldberg and Hans Nichols. Click on the link below:

Bloomberg Article.

Local Banks

Recently, I went to the neighborhood local bank and started a savings account. I did this after researching what the effects of such a move would make on myself, the community, and the bank. I have come to the realization that there is a very important place in the banking industry for local banks. This action is not simply a direct move away from the mega bank. Mega banks also provide a service to the consumer that local banks cannot such as multiple branches and ATM's. It is simply an action taken to provide business to local bankers who keep their plan simple and their mission clear to the community. I encourage everyone to at the very least take a look at your local bank to open up an account.

The savings account was opened for a few reasons. The realization that I will actually see my money at work in the community is exciting to me. Also, local banks make the most of their revenue from banking and stay away from making their profits from other sources like trading. This creates an absolute focus on the business of banking which the megas don't have anymore. The opportunity for future business with the local bank will be made a little easier as their decision makers are in the building.

The idea that my money will be at work providing loans to local businesses is a good feeling. That is the essence of the local bank that the megas cannot match. Since they have a large stake in the community, they will be right there to help when needed. For instance, there is a local bakery right near me that received financing from the local bank. You can bet that I will be frequenting that bakery regularly knowing that people in the neighborhood have put in almost all the equity into the business.

The local banks are focused on banking. The megas have shown a lack of focus on banking and more of a focus on trading. This is clearly evident in their use of TARP funding. It was used for trading profits while lending did not get even the slightest bump. Local banks provide that focus on banking because that is their main source of revenue.

The third reason why I opened the account is that I will actually get to know the bank at a very close level. The decision makers for the bank are either in the same building or at the very least same neighborhood as the tellers and the rest of the bank. That provides an opportunity to create a lasting relationship with individuals of a local bank that I would not have access to at the megas.

So remember to check out your local banks. They provide a laser focus on banking, look to be the principle lender in the community because they are part of the community, and show a level of access that the megas cannot provide.

TCF changing over charge policy

Hey

I received an email from TCF stating that they are changing their overdraft protection to mirror that of Bank of America's. Nice!

Yesterday's trading errors should make for some good water cooler talk. The issue I have is that the market still ended down three percent yesterday! It is down eight percent in two weeks! Either this is a great buying opportunity or we are in for some hurt.

An amendment capping the size of banks failed in the Senate last night. I actually think this is a good thing. We are the ones who need to spread the wealth around and keep our assets in local banks.

Dimon's whining

What is Jamie Dimon thinking? As reported in a New York Times article, Mr. Dimon wrote a note to shareholders expressing his displeasure at the way politicians were demonizing big banks.

Now, the bank seems to be very well run. They also seemed to be in the least amount of trouble during the crisis. They didn't need the stimulus and paid it back as soon as possible. These are all positive aspects to JP Morgan Chase's business.

But to whine about politicians who represent the people is not a smart move. I don't remember seeing a thank you note to the government for guaranteeing his bank's purchase of Bear Stearns. This note in the letter to investors makes him look even more detached from what is going on in this country than previously thought. This note makes him look ungrateful to the public for bailing out the industry he is at the highest level of. It could even be considered similar to a let them eat cake comment.

Where Mr. Dimon should whine is Wall Street. To allow other banks to act so irresponsible without any public comments showed a lack of leadership from Mr. Dimon. Why isn't he whining about the banks that caused this mess and put the hurt on the American people. Why isn't he wondering out loud about how much money they caused his bank to lose?

If he really wants to step up to make his business better, he should be cheering for a higher standard of banking which includes better regulation. Looking to blame the politicians when the problem is your colleagues is weak at best. Mr. Dimon needs to be reminded who really caused the mess and who saved his livelyhood.

Bank of America does well again

Who is this new CEO Brian Moynihan and what does he think he is doing to the bank America loves to hate? First Bank of America decides to make people more responsible with their finances by not allowing debit purchases for accounts without the cash to cover the purchases. Now they are putting together a program for home debt forgiveness. This is beginning to sound like a big turn around for Bank of America.

The program is designed to get homeowners out from being underwater because of the real estate crash. It shows a willingness on the bank's part to help citizens fight for their financial welfare. You can read more about it by clicking on the link.

I guess maybe someone in the Bank of America hierarchy finally realized programs like these end up creating a long term value.

compounding

Hey

I am finding out while building a covered call account how continuing to add capital to the account has increased the call revenue in an almost exponential way.

Compounding truly is a wonder of the world.

test for link...please disregard this

google

Bank of America does well

Hey

For all my bashing of Bank of America, I do have to finally give them credit.

Yesterday they imposed a rule not allowing debit card purchases if the customer does not have the funds to cover the transaction. This is a bold move that could win back my business. It shows that they are willing to sacrifice short term profits by decreasing revenue from overdraft fees in order to run the business of banking correctly.

Thank you Bank of America.

100th post

This is this blog's 100th post.

I thought it should be used to notify everyone that there is one less short sale on the books as my wife and I took it off of B of A and HSBC's hands.

If you want any info on short sales, send me an email and I will answer any questions you may have. It did take 7 months and had a bunch of issues with it but the price and neighborhood were right.

Cheers!

opportunity let go due to discipline

So there is an excellent option opportunity tonight due to Google's earnings announcement after the bell.

But I will not be taking it due to the cash being committed to a different program (call selling) for future trades. Some may say that I should use the money now. But there being a slight possibility that the trade could be incorrect is enough motivation to keep from making that trade.

So what is the trade? It is a straddle trade with either IBM, Google, and Apple. It is my feeling that the growth in the winning option will outweigh the loss in the other option.

Tax cut, move your money

Hey everyone

I think it might be time for the Obama Administration to give a payroll tax cut. I'm thinking that most give to much money to the government during the year anyway.

I also think that moving your money from the big banks to your local banks might make sense in that it might help the local banks recover quicker and repay their outstanding bailout loans to the government. The big banks have already paid back their loans and have reported large profits (pre bailout payback for B of A and Citigroup)during the last quarter. I think it is important to show local bankers that run their business correctly that they have the communities support.

Cumulative Advantage

Hey

I have recently started reading the book "SuperFreakonomics." I came across the term "Cumulative Advantage."

To me, this term has the same level of importance as compound interest. As I write this I am realizing this is a very strong way to become very wealthy. For example, when my savings hits a mark, a percentage gets pulled out and used for other investments. I believe this cycle will eventually lead my wealth creation to high levels. I will have a strong savings base that will grow and assist newer businesses flourish which will in turn do the same.

I recommend this book (I've only read two chapters) and recommend looking into the ideal of using the cumulative advantage to become wealthy!

Good Luck

Bank of America

Hey

I am going through a short sale that took Bank of America seven months to resolve. They in turn gave a two day notice to accept or the house goes to foreclosure. So nice of them. They have their jobs because of us.

Happy New Year Wealth

Happy New Year!

Last year was a good one even through all the turmoil. There are a lot of opportunities for wealth this year whether they be taken in stocks, real estate, or any other investment idea.

I have helped start a call selling account which saw a few trades occur with varying results. You can see a blog on that account at www.wikicallselling.blogspot.com. This year will be focused on developing this account.

I am still seeing many real estate investment opportunities. If wealth develops in other investment areas, real estate will be on the table.

Keep saving and saving some more. The compound interest will be enjoyed.

Don't forget to give and donate time and fortune. Only then will you find true wealth.