Friday, January 25, 2013

Effective health care system

Most proposals on health care delivery do not talk about how to cut down costs, and how to make it fair and practical. We need to know how to pay for it first, how much, and the consequences to businesses and employment. My proposal and comments:

1.       Basic treatments for all.
Better coverage is paid by an individual. We encourage folks to work hard and there is no more free lunch. It is abnormal for the poor to have free health care while the middle class cannot afford to have same.

2.       Fair regulation for nursing home.
Low incomers and/or those without a house most likely can receive free nursing home care, free drugs and free doctor visits in most states like Mass. Those in borderline cheat by giving their houses to their children and many hide their incomes or just quit working.

The government should spend an agreed % of GDP on public health care. We cannot ignore other spending like education or let the budget unbalanced irresponsibly.

When we over spent in any entitlement, we need to hike taxes.  With high taxes, we're no longer competitive globally and hence our unemployment will be increased.

3.       Prevention: Voluntary and non-voluntary (via taxes) on smoking, fast food, soda, etc.
It is fair for the citizens to take care of their own health. You can select to live recklessly in unhealthy life style, but the rest of us should not pay for your bad decision.

When we ban smoking totally, we will not need so many hospitals and will free up many resources. In addition, the second-hand smoke kills too. Why should we die for your bad behavior?

4.       Limit lawsuit award on malpractice.
Our health care cost is being jacked up partly due to the legal expenses.

Most do not realize these lawsuit awards will pass back to us. It is also why the doctor would hesitate to care for you when you fall and lie on the street or why your clinical charges are so high?

5.       State-of-the-art treatments are less effective than prevention such as a low-dosage aspirin for all over 50 years of age and the routine shots for babies / children.

6.       Outsourcing the expensive treatments to foreign countries and drug development / clinical tests.
Our costs are outrageously high. Try Thailand and Shanghai. The money we save pays for a free vacation, not mentioning the free massage every day for the entire trip. Many Caribbean countries offer same dentistry services at half the cost here.

This is a temporary solution until we solve our cost problem at home.

7.       Cut down the expensive drug marketing (like giving money / goodies to doctors).

Personally I know doctors receiving free golf trips to the most expensive golf courses for the entire family. They also got unlimited lobsters in medical conventions in Boston. Should doctors receive the 'lecture fees' giving phony lectures or sales pitches?

Guess who ends up paying for all these goodies eventually?

8.       Stop the illegal aliens and foreigners from using our medical systems free.
Their employers or the patients should pay for their expenses. It is nice to help the rest of the world, but we do not have money to do so now.

Emergency room is the most expensive delivery method and its usage has been abused.

9.       Importing foreign doctors and nurses is the worst we can do to a poor country.
These foreigners are seeking a better economic life for themselves, but forget their original purpose of seeking these noble professions.

10.   Before we send soldiers abroad or explore space (both have some merits but the average citizen does not benefit from these ventures), should we solve our home problems such as health care first? Get our priority straight.

11.   The average last two years of one's life would be the most expensive health care cost. Many do not want to live through pains and sufferings. Should we let them pass away in peace if they want to?

12.   Stem cell research has proven to be promising.
We should not let our politicians dictate the policy for religious reasons. The desperate will go to foreign countries to receive the riskiest treatments anyway. Why let them know their risk and do the treatments here in a better environment?

13.   Stop all the insurance and Medicare frauds.


·         This post has received many positive responses. One blogger even copied my entire post and discussion to another forum.

·         As Obama won the reelection, ObamaCare would be implemented. I hope it will be delayed. It would take us to a recession with higher taxes to pay for and less hiring by small businesses due to the fear of any extra cost. If it requires the company to implement when the number of employees reaches 50, small businesses will cut down the employees to that number and hire part-timers that will not be counted.

·         "Healthcare reform has been "an outstanding success in Massachusetts," a famous author says, calling it a "template" for the nation.”

My arguments against it:

1. Mass. is a rich state with relatively educated citizens. I just argue with my friend that any political system and national health care system would work in Norway as they're so rich and they can afford to be nice.

2. The welfare, entitlements...are too generous and eventually will kill the state. We in Mass. no longer afford manufacturing of low-cost products and many companies already have moved to southern states. When we have too many free loaders and too few givers, we'll bankrupt or drive the rich away as demonstrated in Greece.

·         Singapore is spending 2% of GDP in its world-class health care, Israel is spending 8% of GDP on health care and we are spending 18%.

·         The hurting patient pleaded painfully to the outsourced doctor to get him someone who could speak English. The doctor said, “If I not English, what language I talking?” J

My e-book Debunk the Myths of Buffett could save you a lot of money.

Disclaimer. I'm no responsible for your actions in your investment. Treat this as educational information and past performance does not guarantee future performance.

Wednesday, January 23, 2013

A bargain may not be a bargain

I came across PACT and BAA from my trusted screens.

It looks great on paper. On second look, they are garbage.

I stay away from Chinese companies esp. smaller ones. They do not have an organization like SEC here. PACT could be one of them. With 80% short, it is not a short squeeze but a company heading to zero. It could net me 50% profit, but I prefer to skip this one and have a good sleep.

BAA is some bank in Africa. I cannot tell reliable is the company. I skip it again and ask my screens to give me better quality companies.

The best looking prostitutes could bring you death sentence. Skip the temptation and have a good sleep.

Saturday, January 19, 2013

ObamaCare and small businessmen

All good businessmen need to predict the cost of any investment. Today's they hesitate.

ObamaCare could require them to pay extra cost to share the health care expenses. I predict small businesses will cut down employment according to the laws, so they are not required to pay for this expense like part-timers (working less than 30 hours) and /or small businesses (hiring less than 50)

Representation with taxation

We should have a ballot for what % to be spent on certain area such as welfare, education, war... Most likely everyone wants to spend 0% on war.

For a joke, we should have an IQ meter and your tax return from last year at the voting booth. You cannot vote with an IQ lower than a specific score. So stupid folks cannot vote. If you do not pay taxes, are free loader or able, long-term welfare recipients, you cannot vote. It is called representation with taxation.

Business Cycle vs Market Cycle

I believe we can use the past to data fit and predict the future. However, the older the information, the less useful they are.
* The economy conditions changes. We did not have most today's regulations in the depression. Examples abound.

* Business Cycle follows Market Cycle. It is not true as the Market has fully recovered from 2008 and the Business has not recovered.

* Employment is one of the major metrics in Business Cycle. Our economy may recover without recovering employment (unemployment + under-employment).

Why? The world is more globally connected. The corporations make more money by shifting jobs to any other country.

* QE, printing money, foreign loans (to China...), reserve currency, debt ceiling all mean the same: Live in a higher living standard that we can afford.

When Uncle Sam uses all the tools to maintain our living standard and being the world policeman (a paper one when our economy is screwed up beyond repair), he is running out of tools. Each tool is a temporary fix but a long term trap.

* The shale energy could save the entire US economy and another war could do the opposite. You cannot find this info from any charts and data.

On Mongolia

Be careful on the emerging countries like this one:

1. Do not trust most of the financial statements. They do not have an organization like SEC and the audit firms are working for the companies. They learn the tricks from some fraudulent Chinese companies.

Mining companies are hard to evaluate. You need to compare how much mines they have and how expensive to extract, ship and market, not counting the current price of the commodity.

2. Do not know whether the government wants to 'nationalize' the company when they see appropriate.

3. Mongolia is a land-locked place. It depends on Russia and China. Russia has not been nice to Mongolia (due to the invasion from Khan whom the Russians still remember even after several drinks of Volka) and set it up a buffer zone when China was weak.

China wants its coal and other resources. Throughout history they were aggressors (if you read the long history of China and the Great Wall) as it used to produce nothing except some cattle and loots from the travelers and Chinese. Now, they have the natural resources discovered recently. Today's Mongolians are exceptionally friendly though.

Disclaimer: I had profited from Ivanhoe Mine before. I got out early to have a good sleep.

Boeing and her problems

So far, there is no impact on the share price. I wonder why too.

So far, there is one cancellation (that I know of). However, the back order is so long that there is no impact at all. The order serves as a place in the queue and there is no serious obligation. I do not know about the compensation part.

I believe there is a settlement with the engineers who belong to a union too

Marketing and development always fight against each other, and usually marketing wins - the one who brings in $ always wins.

All the problems are OK (ask Microsoft on all the Windows bugs and the bugs over the 'fixes' on the bugs) except safety. BA should have one new plane for Alpha test and then Beta test and give free life insurance to all the initial passengers plus a free coupon for future flight :)  


The market does not respond much to BA's problems. I prepare to buy it if it is in the waste basket, but it is not so far. It is in the upper half of the yearly range.

* The battery is a easy fix. Just replace it with the old, reliable lead battery now and wait for advancement in battery technology. Alternatively, find a reliable way to cool the battery like I have a fan for my laptop. If it were the electrical system, then it takes longer and more expensive to fix.

* The windshield crack could be a bigger but ignored problem.

When BA makes so many advancements on a new plane, I figure they will have unavoidable problems. They should implement new features more conservatively.

So far it does not change the manufacturing schedule and only give the Air Bus a smile. 


Tuesday, January 15, 2013

Is Apple a good buy?

At the current P/E, it is cheap especially if you consider their cash reserve. However, Apple will not have the same growth rate beyond 2015. As of 2012, it is turning itself from a growth stock to a value stock with minor dividend. After one or two upgrades by the consumers, the current products will not be economically feasible for upgrades except to boost one's social status. I expect many will take profit in the 4Q 2012 expecting higher capital gain tax next year. My bet is it will come back to 700 if we have good sales of iPhone5 in China. The lure warm reception in China is not due to the products and the market. It is due to Apple’s allotment system and the supply.   

In addition, Apple has lost a visionary leader Steve Jobs. I hope he was not replaced by similar managers at Microsoft, who are responsible for Microsoft's lost decade without innovations. Apple has a lot of cash to finance new projects. High tech business is tough as you need to build a better mouse trap. When the mouse trap becomes a commodity, it will not have a good margin profit. Apple still has a lot of new mouse traps or using the iPad for a lot of applications. It will fluctuate between 750 and 500. Apple will benefit itself with splitting the stock by 1 to 10.

There are bright spots for Apple:

1.       Apple Text Book. Imagine all students carry an iPad instead of text books.

2.       Apple TV. It is a loser so far and it is a very risky and expensive venture. However, the potential is great. It could give all cable companies a run for the money.

3.       While the iPad and iPhone are peaking in the hardware, the software and contents for these devices to access have no limit. We have witnessed how it helps the folks with autism. I can envision many similar applications.

4.       Apple moves to Kindle's market. iPad is too big to be used to read books during commute. You need to hold an iPad with two hands. Kindle is still king for commuters.  However, the iPad, making less profit margins, will be Apple’s answer to Kindle.

My e-book Debunk the Myths of Buffett could save you a lot of money.

Disclaimer. I'm no responsible for your actions in your investment. Treat this as educational information and past performance does not guarantee future performance.

Monday, January 14, 2013

From Dr. Fredd on covered calls - I beleive I saved it already

It does stimulate some introspection! I write a lot of covered calls against my portfolio with pretty good results. Almost all in IRAs so tax consideration is not relevant. My rules:
1. keep the time short (weekly or one month usually)
2. check the chart and if strong uptrend go further OOM on strike
3. if this is a stock that I bought strictly as an option play, I just let the stock go. ( I've made what I hoped to already.)
4. if it is a stock that I want and it's close to the money, I will buy it back late on expiration Friday when there is no time value.
5. if the stock I want is way in the money, I let it go, and sell puts to get it back. In this last case I count the money over strike as a loss and adjust this later when I buy it back.
6. no double downs or roll outs allowed.
YTD I have made $40k with this strategy, not counting dividends, on about $400k of my portfolio. ( From the looks of things, I may be giving back some of that today.)

Monday, January 7, 2013

My first published article in Seeking Alpha

Hi folks,

I just wrote an article Amazing Returns on Seeking Alpha, a financial site. It will be buried somewhere if there are no readers. Please click here or cut and paste the following link (there is no limit in number of times you click). You can make some comments too.

I am using it to promote my new book on investing.



BTW, there is no big deal to write a e-book in today's technology as long as you have too much time on your hands.

Tuesday, January 1, 2013

How accurate are my predictions.

I wrote it as one blogger wanted proofs. I should say I have been quite accurate. Past performance does not guarantee future results. Do not bet your money based on my predictions.

See my blog and its comments.

The content of the blog can be changed but not the comment.

Check my prediction for 2013 and save it yourself.

I had my statement for 2009 that I had the best year due to the prediction. I saved the screen shot.

I moved all my tech sector funds to traditional funds (cash is better) on the first week of April, 2000. I have the proof from my statement.

My prediction on April top had been seen in SA by almost 1,000 and it was within a month accurate.

For the last 90 days, my stock performance is 12 times better than S&P 500 and I saved the screen shots too.