After sharing one of my favorite haikus:
Haikus are easy,with a friend, he pointed me to fiscalhaiku.com. This prompted me to create my very own fiscal haiku, but I decided to post it here rather than on their site. It's based on the writings attributed to Alexander Tyler.
but sometimes they don't make sense.
Refrigerator.
Most of the interview advice I've read focuses on how to answer the interviewer's questions. It is very important to learn how to present yourself to a potential employer, but the interview is also the best time seriously investigate whether the position would suit you.
I've used the questions below to gain insight into the details of a job opportunity as well as the dynamics of the group of people I would be working with. You'll notice that I ask the same questions of management as I do co-workers. I generally hope to hear the same answers from each group because divergent answers can signal trouble.
Of every interviewer:
My employer just "upgraded" to Office 2007. Among all the new annoyances, this is my favorite:
I open a file and I'm greeted with a message box that reads, File error: data may have been lost.
Could they have possibly come up with a more ambiguous and vague error? Data may have been lost? That seems like something important enough to provide more than a message box with an "OK" button to press. No "click here for more information", just a button to acknowledge that something bad may have happened.
Office 2007, the Vista of office suites.
If you're not familiar with Chuck Norris Facts, I suggest you check them out. These were sent to me by Dirk Eddelbuettel via email.
Chuck Norris, investment banker
from Felix Salmon by Felix Salmon
If you haven't subscribed to The Epicurean Dealmaker's twitter feed, do so now. This morning he decided he was going to go all Chuck Norris Facts on us, and came up with some absolute classics:
- Little-known Chuck Norris Fact: Chuck Norris does not mark to market. The market marks to Chuck.
- Chuck Norris does not go bankrupt. Chuck Norris ruptures banks.
- Source of hedge fund survivorship bias?: Funds that pay Chuck Norris 2 and 20 survive; others don't.
- Private equity: Chuck Norris does not believe in leverage. Chuck Norris believes in crowbars.
- Investment banking: No-one defers Chuck Norris's compensation.
- Capital structure: No-one subordinates Chuck Norris. All his equity is preferred.
- If Chuck Norris devised the bank stress tests, not even the Treasury Department would survive.
Today's market was interesting. Lots of movement, but didn't really get anywhere. Volume was about as heavy today as it was yesterday.
This is a bad sign for those hoping for the rally. I expect a bear-market rally, but to at least test this market's lows.
John Mauldin raises an interesting point about President Obama's cap-and-trade proposal. I'm not convinced the proposal would cause utility companies to raise prices though - mainly because most have government-regulated prices.
If the costs aren't borne via higher prices to consumers, John's conclusions won't follow. That said, the increased costs will have to be dealt with somehow.
And I definitely agree that GDP is going to be *way* below the 4% forecast. The economy has been above the natural rate of growth for many years and tends to revert to the natural rate, which means we should anticipate years of sub-3% real GDP growth.
Obama wants to create a cap-and-trade program for carbon emissions. This is expected to generate $79 billion in 2012, $237 billion by 2014, and grow to $646 billion by 2019. These will be payments by energy (primarily utility) companies to the government. That will cause utilities to have to raise the prices they charge customers for energy. Such a level of taxation is eventually 4-5% of total US GDP. That is not small potatoes. And since the wealthy do not use all that much more power than the rest of us, it will affect the lower incomes disproportionately.Source:
It will take money out of consumers' pockets and transfer it to the government. You can call it cap-and-trade, but it is a tax. And a huge one. Anything that will take 4% of GDP away from consumer spending is not business friendly. And by driving the cost of energy up, it will drive high-energy-using businesses away from the US to developing countries where energy is cheaper. It will make it even harder for people to save money and drive up costs for the elderly and retired. But it will make the environmental lobby happy.
Further, Obama's accounting magicians assume that the US economy is going to grow by 1.2% this year and 3.2% next year and at a blistering 4% pace after that. Since that is not likely to happen, the deficits will be far worse than projected. Since large taxpayers can see the tax increase coming, it is likely that they will shift behavior, and tax revenues will be less than projected.
The Saint Louis Fed recently created a brief report that tracks the current recession via the behavior of GDP components and four economic indicators: industrial production, real income, employment, and real retail sales.
The report graphs multiple business cycles, by aligning the months in which each business cycle peaked. This allows you to compare the months leading up to, and following, peaks in the business cycle. In addition to the current series values, the average, highest, and lowest series values are displayed.
During this recession, the US has experienced the worst declines in industrial production and real retail sales, and is close to showing the worst decline in employment.
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The International Center for Futures and Derivatives at UIC, REvolution Computing, Windows HPC Server 2008, insight algorithmics, and members of the R finance community are pleased to announce:
R/Finance 2009: Applied Finance with R
April 24 and 25, 2009, in Chicago, IL, USA
Scheduled Keynote Speakers:
I've been following US Bancorp (USB) pretty closely through this credit crisis -- thanks to Jim Jubak. He thinks it is one of the few banks that will emerge from this crisis victorious, and I tend to agree with him.
The stock currently yields ~12%, but much of that is due to the fear of a dividend cut caused by the most recent earnings release. Jim Jubak's comments are below.
Will US Bancorp follow the lead of so many of its peers in the banking industry and cut its dividend? The question isn't academic to me: I had added this stock to Jubak's Picks in April 2008 because it then paid better than 5%.Source:
Since the company's Jan. 21 announcement on fourth-quarter earnings, a majority of investors on Wall Street have been thinking the dividend is headed for a cut. A stock-price drop of 12.5% on Jan. 22 left the yield on the shares at 12.1%. You don't see that kind of a yield on a bank stock unless the market is convinced the company will cut its payout.
I can certainly see why investors think that. The bank didn't exactly give a ringing defense of the dividend in its earnings conference call. Executives said the company believes it will be able to cover the dividend from earnings in 2009 but noted that it reviews the dividend every 90 days -- which puts the next review in March -- and that the bank has no intention of continuing the current dividend if earnings don't cover the payout.
The real issue then, as the company said in its statement, is earnings for the rest of 2009. On Jan. 21, US Bancorp reported earnings of 15 cents a share. That's a profit -- unusual for a bank these days -- but still 7 cents a share below what Wall Street had expected. The problems? There were $253 million in losses on securities and a $635 million increase in provision for credit losses. All in all, charges and losses chopped 34 cents a share out of earnings.
It's also clear that the bank's business, like that of all banks I know of, is still getting worse. Nonperforming assets climbed to 1.14% in December, and the bank said it anticipated that nonperforming assets -- that is, loans that the bank can't collect on in a timely fashion -- will continue to climb in 2009. It's cold comfort to investors that the bank's performance continues to be so much better than other banks'. The increase in nonperforming assets to 1.14% in December is only a modest increase from the 0.88% in September. That indicates the bank's lending standards continue to hold up to a very difficult economy.
The bank's operating results, in fact, were quite impressive. Loans grew 17% (12.7% excluding acquisitions) and deposits 15.2% (9.6% excluding acquisitions) from the fourth quarter of 2007. (In November 2008, the company acquired Downey Savings and Loan and PFF Bank and Trust from the Federal Deposit Insurance Corp.) Net interest income grew 22.6%. Tier 1 capital remained at a strong 10.6%.
So will US Bancorp cut the dividend or not? Unfortunately, it's a danger and, also unfortunately, uncertain. It depends on how long the economy struggles and how big the losses get on the bank's portfolio of loans. I still think US Bancorp will be a winner in the current crisis, and this quarter's results are evidence that the bank is picking up loan and deposit volume as customers opt for the bank's relative safety.
