Tuesday, 28 April 2015

Thursday, 23 April 2015

Steel Authority of India - 22.43% gain, Tata Steel - 10.41% gain and Tata Motors - 30.57% gain. I think the most potential for growth is in India. I think their is scope for massive investment in power and transport infrastructure, and in housing. Also a growing lower middle class who will want affordable motor vehicles. Surely it possible to build basic cars with basic engines but with comfort for $500. Would electrical engines be cheaper to make and also lower pollution. Labour has very low levels of bargaining power in the economy so wages are low and this lowers consumption, encourages the informal economy from which no tax can be raised; India does not have the financial muscle and foreign exchange reserves of China to fund a construction boom, however, there is a lot of cheap available labour to lower the cost of building it.

National Grid - 5.6% Loss. I think it is opportunistic buy a stake in what should be a state monopoly. A defensive stock because its revenue it guaranteed. The market has probably valued it correctly, but it should appreciate with the rest of the market on the back of increasing savings caused by a demographic bulges in the third age group

Netflix - 47.85% Gain. I am always thinking of selling this. Producers could have the ability to withhold supply if they started a rival, like Tidal in music to Spotify. However, there is no competitor at the moment and I hope I will be able to choose the correct moment to sell. I will look out for signals of sentiment within the market. If Disney offered their own subscription service could they out-bid Nertflix for content, or in the bidding process drive up costs and eat into margin or they will have to increase subscription fees and this will test the elasticity of demand for a product that is almost a ubiquitous unconscious payment every month; would an increase in price increase the visibility of this charge and the consumer might question its value.  

Starbucks - 24.16% gain. I think it is an easily exportable model and it has not penetrated India, China or Africa to a great extent. I think a careful approach to the strictness of imposing a corporate culture is less important new revenue streams and growth. Coca-Cola is the example to follow in using a low tech supply chain, and low tech product to infiltrate low tech markets.

Wednesday, 22 April 2015

Stocks to watch at the moment using my model portfolio since November 2013

Electronic Arts - 114.48% gain. Strong financial health is shown by confidence of management to enter sponsorship deals for major sports. Strong franchises in Rest of World and American Football, Golf, Boxing; namely sports franchises which are the best selling video game on most systems has given it a good reputation with consumers. Their is evidence of self reinforcing brand loyalty. New products are released Annually at Peak times which provide stable revenue streams. Most competitors are independent and cannot compete in terms of naming terms and partnerships with major Sporting organisations, such as FIFA.
However, recent attempts to monetize the games on the IPAD has been poorly implemented, and has reduced the quality of some of their products. There is an untapped market for big budget video games and EA have the scale and resources to take advantage of this.
Mentioned Alongside Sony - 82.13% gain for developing high quality gaming machines which will become more prevalent as younger consumers age and still use the devices when they are adults and when they retire.

Lockheed Martin - 52.37% gain. The US Government currently prioritizes high tech spending in its budget. This is likely to continue as Warfare becomes more technologically advanced. I think their might be a potential risk if their actually was a large scale conventional war involving the USA because you cannot mass produce US$200m dollar advanced Aircraft and Missiles. The likelihood of such a war is limited because of Nuclear Weapons.

Just Eat - 45.61% gain. This is the UK's food amazon. They have first mover advantage, they have brand awareness; they will hopefully have a transformational affect on take away food by increasing the choice and lead to the development of a greater variety of takeaways; for instance being able to order well made home made food from independent chefs. I am very dubious about the valuation of tech companies

United Health Group - 74.69% gain. Not sure what they do but could have something to do with change in USA health insurance market since Obamacare??

Adidas - 27.50% Loss. Everyone in the third world seems to have a Football strip or might want to buy one in the future, do they sell low cost Football strip replicas in the third world, the main leisure activity in the developed world is sport. Huge brand awareness like Nike - 33.67% gain. The brand might be the only thing saving the business for Adidas but provision of only slightly differentiated product recycled on an annual basis will guarantee revenue in the mass fashion segment

EDF - 23.96% Loss. French Power company in a strong bargaining power position due to wasteful competition in what should be a state monopoly, should be able to capture increased margins. Is underperformance due to general market sentiment about the French economy. Industries from the rich North should be able to expand southwards and capture new markets in less efficient national markets.

Glencore - 18.44% Loss.  The core business of facilitation is always profitable, it is the difference between the amount sold and the amount bought always makes money for traders. This does not depend on the actual price of the commodity. Is it able to take advantage of niche markets as asset heavy miners dispose of unwieldy, costly, uncontrollable production facilities. Underperformance is perhaps market sentiment about commodities, financial results will hopefully bring about a rebound.
Cut-throat vision of management will probably make future profitability likely; but this is not real money so who knows if a scandal is unfolding in terms of ethics behind closed doors in terms of human rights abuses by suppliers. A similar company to Archer Daniel Midland - Gain 21.1%, who are performing well on strong sentiment for US Stocks. Improved technology will perhaps increase the scope of market makers to source supply from independent small scale firms, and help large firms source supply from a much wider range and so earn more fees by matching buyer and seller 

Ecobank - 23.55% Gain. I am not a professional but I bought 1.5m shares and it is only worth about US$160k. African bank with good local knowledge. Not sure it is realistic to buy 10m shares for a good sized slice

State Street - 23.18% Gain. Making money on passive retail funds. 401k's are heading to them or Blackrock because they have the scale to follow the Index, alongside Blackrock 24.99%

Thursday, 16 April 2015

It is a simple fact that you cannot have economic growth without increased Energy use. Increasing Energy use means more CO2 in the atmosphere and the climate does seem to be changing (I think Climate models are like economic models; they tend towards inherent bias and innumerable to infinity false positives because of assumptions that are spurious at best; but my opinion does not matter in the slightest.)
The orthodox approach to climate change is to use less Energy,  or to exterminate the worldwide bovine population, or to use inefficient, expensive, unreliable renewable Energy instead. I think their is a great future for renewable energy; is it possible to wind farms in the middle of the Atlantic? is it possible to go to the Moon? If Hanergy Energy have found a way of embedding an efficient solar panel in a pane of glass, then I think every building and every car should have one. This technology will not develop quickly, vast amounts of resources and investment is required. National Governments have squabbled about cutting carbon emissions and have been unable to agree any measures that are able to have an effect in reducing levels of CO2 in the atmosphere, Would they be willing to pool resources to develop technology for more efficient renewable Energy? Would the Bill Gates Foundation, or Mark Zuckerberg, or some other benevolent firm be willing to pioneer a project like building windfarms deep out to sea in the cape of good hope. Would it make sense to build solar panels and place them in the entirety of all the Deserts in the World? This would have more affect than trying to persuade national governments to slow Economic growth by using less Energy. Environmental groups would probably protest if some one did try and build a massive platform in the middle of the sea to put wind turbines on, but most people do not want their living standards to go backwards in the short-term by being austere with consumption and energy.
I am not an Engineer, but I think devices shaped like ship's Sails would capture wind more effectively than a huge metal windmill. Is it possible to design a device made from super light material which could be flown like a kite in order to capture high velocity, high altitude  winds and use it to generate energy? Even a device on the sea and on land shaped like a sail; would seem in layman's terms to be more efficient than the current, some might say,  not aerodynamic, obtrusive design.
Drones with effective solar panels could be used above the cloud line to capture Solar Electricity at high altitude, and then store it using effective batteries and deliver it when needed to power stations. Perhaps someone more qualified needs to come up with realistic ideas, but my point is that they should be discussing new technology, funding new ideas, on a much larger scale using international national government funding, alongside much needed private philanthropic funding. This is the first priority of business; it would need a conference lasting a hundred years for all the nations of the world to agree to stop using so much energy; the problem is Carbon, not Energy, provision of Energy is required for the international ending of poverty and free energy provided by a State run Monopoly is the most effective to way to run it.
This will not happen overnight, there needs to be a short-term solution; Deforestation was caused by human development in the middle ages, and urbanisation provides the opportunity for re-forestation Could we all plant trees.  There is a lot of waste ground in cities where plants and trees could be grown, trees and plants could be grown on buildings, on roofs, beside the highway if all cars had to run on electrical power by law. Could those who live on state handouts be employed planting and tending these trees. Governments could subsidise farmers to grow trees? This would not be enough to absorb and so reduce CO2 levels unless it was implemented on a world wide scale; It is unlikely that flowers and trees would bloom on the roofs of the houses in Beijing because of the incessant smog; planting CO2 absorbing trees and plants would probably not be enough to have an impact reducing CO2 levels, unless?

Monday, 6 April 2015

For me Peace is more important than any of our principles
The problem with instability that has led to civil war is that the State is hijacked by the army.
I think it would be better to allow the civilians to run this State, to perhaps let it exist and to develop systems of governance. It often seems obscene that Billions of Petro-Dollars are spent on skyscrapers and race tracks when it could have been spent rebuilding North Iraq. I have read, what are probably untrue rumors, that the only thing that the rich gulf states finance abroad are Guns and Butter. It is better to own Trafalgar square than give the people of Tahrir square modern housing. If faced with the choice would the Arab spring protesters have chosen improved living standards over Democracy? A Democratic election is pointless if the system of government is open to corrupt methods of improper governance, in fact recent history has shown that the imposition of sudden revolutionary Democracy causes more harm than good, it often collapses into civil war, or is replaced. Democracy developed in the West, agreements were made from Magna Carta to the Suffragettes as the relative bargaining power of the constituents involved reached new points of balance. I feel that a gradual move to Democracy is a much more sensible idea; however, limited Democracy may turn out to be a charade, it is a step on the path, and many feel that Western Democratic systems are a facade also
The Chinese, The Americans they have funds which invest all over the world, but who lends to Palestine, to Egypt except clandestine Europeans and Americans. Sovereign Wealth Funds have invested in Europe and America, are they able to invest in North Iraq, North Syria, Pakistan and Afghanistan. A Petrol Dollar Fund would not be giving loans, it would be investing, the IMF cuts government investment as condition for its interest charging loans, a Gulf fund loan would be extra spending in partnership; this would be a different approach to Investment; another function rather than dishing out emergency loans. Investing in providing Domestic Energy supplies, Solar Power, better housing, and new roads. I think you can build a building in Iraq and call it a hospital or a school, but the people who live their will use it is a building, and then decide what to use if for; what seems it best use to their local needs.
I wonder why these people have turned to this Savagery? Is it evil or is it desperation? I do not know, I have never met one of them, it seems to me as if it is the brutal stupid army staffed by hooligans and thugs, illiterates, and video game fans, fulfilling the role of civil government structures that have disintegrated all over Syria and Iraq. I do not thinks Bombs dropped by remote control by young men looking at screens like they are playing video games inspires empathy, but watching someone die does, it has been proven in studies that many soldiers do not fire their guns or shoot to miss, even if this is not a conscious decision, especially amateurs. I would recommend infiltration,because they apparently let anybody join them, then decapitation of the leadership, hit and run attacks with tactical assault squads. I am fairly certain that the US Army could continue to massacre them and who else who happened to be standing precisely near with drones and missiles but this would make things a bit more exciting for your elite soldiers; alas, it is a sacrifice some give without much thought
The war must be ended, the borders must be redrawn more appropriately. The Sunni people of Iraq perhaps need their own State and Syria should be divided along current territorial lines. The gulf states must take the lead in negotiating the peace but instead they fight their wars

Friday, 3 April 2015

The problem is how to end austerity. The government cannot afford to spend anything extra to end austerity, the main costs are welfare and health. Democratic politicians cannot say anything about making people pay for health without risking their careers, cutting welfare at a broad stroke will inevitably penalize some of the truly deserving, and means testing would perhaps cost more in terms of more bureaucracy and time than it would ultimately save. It seems ineffable that  Public Sector employment in some areas is dependent on the provision of welfare, and the support of its recipients.
The provision of charity is the duty of the church it is not the underlying philosophy and ethics of the left-wing. Making zero-hour contracts will make people lose their jobs, if benefits were paid to people on zero-hour contracts to top up their wages on days when they were not working, this would benefit these workers psychologically as they would feel more secure, and also enable businesses to keep on hiring workers. It is a sad state of affairs when only immigrants will take these jobs, I was on a bus the other week and a social worker was talking to a young man who seemed prone to trouble, no business would want to employ this man if he was prone to bursts of anger, substance abuse, illiteracy (not stupidity), and opportunistic theft. I am certain that neither rehabilitation and discipline would not help cure this man of his poverty. Community service is used to punish criminals, it should be expanded to socialize the unemployed. This would probably cost more than it does at the moment to pay them benefits to stay in their homes, however would probably encourage people to take jobs in the private sector unless washing dishes, cleaning graffiti, cleaning up chewing gum sewing curtains, fixing pot-holes and collecting litter is fun. Making people work for free for their benefits in the private sector does not work because it replaces private sector jobs.
Free market micro-finance in the UK has spawned pay-day loan companies charging rates of interest the Mafia would be proud of. Would it not be better if the government could provide similar loans at a much lower rate of interest? This may even turn a profit in today's interest rate conditions and would be a good supplement a stimulant to Demand alongside a trillion pounds re-liquidizing the banks.
It seems unlikely that these dependents will establish legitimate businesses, they are dependent on being given employment. The sharp blade of Capitalism creates more money than the correctly criticized command economy, however a Factory opened in the the Glasgow slums making widgets employing the young delinquent gang members function is to promote social cohesion not make a profit

Friday, 27 March 2015

I think the main problem with both parties in the UK is that they are to in-hoc to their minority financiers and bizarre party members. Members of political parties are in an undoubted minority, yet both parties are designed by these odd-ball pressure groups and policy think tanks, it is surely too much of generalization to recommend that some common sense could be applied. It is undoubtedly the current makeup of both parties in that they consist of professional politicians. Surely it has been proven over the last 700 years that such professionalism is best kept to the civil service rather than giving the keys to the vault to careerist and worse.
The labor party apparently holds the left with a rainbow coalition that has alienated its core vote. The Conservative party has every ones trust but is influenced at highest level by an ancient tradition by barmy Kippers in disguise
It is antithetical that the rich benefit from the welfare state, it was always for the poor, ideals do not exist perfectly, it is obvious that we cannot afford it, the service provided must be universal, the money spent should be according to income. Insurance is not that expensive, drugs are, new hospitals are, more money is needed desperately. I am not wealthy but I would not mind paying for health insurance, I am not rational, I value the common wealth above all other things
Taxing property held by non-dom's instead of the mansion tax. Cutting the foreign aid budget, you may have went to Eton and Oxford but it is not 1890 any more, never mind India, what about Liverpool, what about Dundee, put microchips in cars and tax by the mile, give discounts to professional drivers, let the teachers run the schools - the government sets the exams, the league tables do the rest. Sharing resources with Europe on a joint defense strategy, WWII ended almost a hundred years ago, after one hundred years can we please stop celebrating it, or  can we celebrate it without thinking we are still planning for D-Day.
It seems almost facetious to suggest that you should use the Trotsky tactic of corruption from within to change Europe into something less ponderous. If Churchill had been pit the younger he would have saved his resources and not squandered them on mad ventures in Mandalay and left the nation in hoc for the next 50 years at the cost of the whole empire. It is complete idiocy, patriotism is for winning votes, it is not an ideology grounded in what is the most profitable for us. Has all the ambition been spent on politicians dancing to the public's accordion and the civil service is now inhabited by journeymen. The world cries out for lazy bureaucrats rather than busy myopic ones, perhaps governments should seek to hire less imaginative conservative fellows. A Tory bloody mindlessness trying to crash the car into a ditch because it will make you look clever in front of your fellows.
Scottish independence would work if it were not for Clyde side, a tragedy, I think the Ms Sturgeon should concentrate on the long game, governorship requires stability, acting sensibly instead of in hope of vain-glory. The first task is not independence, not now, it is too dangerous for us, look at Greece, look at Ireland, the ultimate goal is independence not ultimate dependence, your first task is to end poverty in Glasgow and Dundee. Public service is not a calling for a smirking nuisance.
Your second task is to set up Sports academies in which young footballers, golfers and Curlers can train and get an education and then go to University like in the United States
Mr Milliband remember the North, listen to what they say, it is the truth, you might find it a little unpalatable,  but it is not for show, it is what needs to be done. End poverty in Barnsley first, world peace second - which is why you were elected.
And Mr Cameron I think you need to find the pulse of what the people want more than listening to old fart face.
I think I have Liberal values and I would like to install you all the permanent house of lords which you can probably fulfill as coalition partner. Increasing the tax threshold to take the lowest earners out of tax will drive growth, will drive consumption, than a tax cut for the rich to funnel into the heaving hoard of savings in the stock-market
Populism wins elections not policies. Only the self-interested vote, not the cynics.