No post till later

Traveling back up to Seattle to see the girlfriend this weekend. Was going to try and write something up tonight, but it is really really late. I got home from a late night of playing RockBand desipte the fact I have to get up early to catch the commuter train since I'm leaving straight from work and not taking my car. Instead I'll leave a bunch of links I'm reading.

Oil Surpasses $103 for First Time - Do I hear $110?

Bush, Fed Chief See No Recession Ahead - Thanks Ben. Really.

 Dollar weakens even Further.  - Weak dollar causes higher oil, causes inflation, amplified by the fact foreign goods are more expensive.  Not pretty

Dell Misses -  Whatever happened to Dell?  They used to make such great affordable computers.  My latest experiences have not been all that favorable.

I'll try to post while in Seattle this weekend.  Everyone take care.

Why Ben, Why?

Will you please stop with the rate cutting? You already made the mistake of cutting rates, and you are going to do it again?  You can't save the economy now.  You can't make housing prices go back up.  There is only so much the fed can actually do.  Cutting rates is not the panacea you are making it out to be.

For years, the Fed provided cheap money.  That cheap money caused the problems you are now seeing.  And the solution is to throw more cheap money at it.  It's like paying off your credit card with more credit cards.  It just won't work.  Let the economy feel some pain and lets move on.

The High Price of Oil

Oil shot past $101 today in after-hours trading.

I love news like this actually. The picture is actually starting to look pretty bleak. Housing is bad, and in my opinion will get worse, no matter what the crooks, I mean real estate industry has to say. The US looks headed for a recession. The superstars of tomorrow are having problems. High energy prices mean that inflation is likely.

Inflation + Recession = Stagflation

which is the worse thing that could happen to our economy.  So despite all this doom and gloom, why would this type of thing make me smile? Because things are starting to get to a point where I might be interested in buying. Granted, I probably can't double my money this year, but long term, there are starting to be some interesting plays. Best time to buy stocks is when nobody else wants to, and right now, a lot of people are fleeing stocks.

Google Looking Interesting - Still Not a Buy

Google Closed yesterday at $486.44.  This represents a 4% drop from the previous close.  This despite the fact that the rest of the market saw a strong day with an up 1% day on the Nasdaq and a 1.5% up day on the Dow.

I've actually been looking for an in to Google stock since it originally broke and stayed above the $500 barrier in Jun of 2007.  It broke it a few times before that but could not sustain itself.  in August of 2007, it took a brief dip below $500 but recovered soon thereafter.

Now it has gone under $500, and I believe that will be a strong resistance point from now on.  If it can rally in the next few days and find a way above it, then perhaps it will stay there, but in all likelihood it will stay below.  It is never good when a stock like this, which has been a leader for so long, goes in a tailspin down.  Part of it up until now could be blamed on the overall market.  But when the market turns, and a stock like this doesn't turn with it, you have to be concerned.

I don't think it has much to go down from here, but I still don't think its a buy.  Long term, I believe Google is probably a good buy,especially at a 30P/E.  Short term, $450 is possible, and perhaps lower.

Best Investment Books for Beginners

I've often been asked what are the best investment books for someone to read if they are just starting out. I've read a lot of books on the topic and I'm happy to share my opinion on what the best books are for someone just starting out.

One Up On Wall Street- If there is one book the average investor should read about buying individual stocks, this is probably it. It is very well written and offers very pragmatic advice on how tho think about individual stocks.  It is written by Peter Lynch who became famous running Fidelity's Magellan fund and it is written to show how an ordinary person has some rather large advantages over the boys in Wall Street.

Robert Hagstrom's The Warren Buffett Way -Readers of my blog know how much I admire Buffet. I believe his technique (despite what I may espouse on this website) is the way to go. Buy well run companies that are easy to understand and that are attractively priced. Buffet himself has never written a book, but Hagstrom clearly outlines what Buffet has done to make himself one of the wealthiest men on the planet.

Pat Dorsey's The Five Rules for Successful Stock Investing - This is a really great book to teach you the basics of how to evaluate a company and what the important metrics are.  I also like the fact that it has in its appendix how to evaluate companies in different sectors.  Evaluating a bank is much different than evaluating a tech company, and this book shows you the basics so you can get started.

Joel Greenblatt's The Little Book That Beats the Market-  The best book is the book that you read and you finish.  That's why I put this book on the list.  It's very short and a very quick read.  The advice is actually half way decent, but more importantly it is simple to follow.  He even has a website that does all the work for you.  The thing I like about it most is that it should make it really simple for you to invest, and the most important thing when it comes to investing is to just start.

There are a lot more books I suggest you read, but this should give you an excellent starting point.  Like I said, start with the basics and then go from there.

After Fight - No Hard Feelings

Just as an update to my last post. To show the bag that he didn't have any hard feelings, my cat decided to take a nap and snuggle up next to it. Proving that we can all get along.m

Save Money On Pet Toys

I used to buy my cat lots of toys. I figured I was doing OK financially and that I might as well "spoil" my cat a little by buying him toys whenever I had the chance. Part of it was guilt because I knew I didn't play with my cat nearly as much as I should.

However, I soon learned that buying cat toys was a waste of money. My cat found ways to entertain himself with whatever was lying around. I think I first came to this realization when I tried to celebrate Christmas with my cat by buying him some gifts. He ended up playing more with the wrapping paper and ribbon than he did with anything I bought him.

To prove my point, I took this video of my cat. Here he is with a plastic bag I happened to leave on the floor.





He rarely if ever enjoys playing with the toys I buy him from the store. He's learned to entertain himself with bags, string, cords, leaves I drag in from outside, etc. The last toy I bought him, a self moving electronic gizmo with some sort of feather attached to the end of it, entertained him for about 5 minutes, and then was forgotten. Cost $20. This bag cost me nothing, and brought him the same amount of amusement.