More Cypriot Possibilities

The Cyprus resolution is taking shape as it looks like accounts with balances greater than €100,000 will be subject to a 30% hit to go toward meeting the requirements of the bailout. This news seemed to have visible impacts on iShares Italy (EWI) and iShares Spain (EWP) which were both down more than 4% yesterday. Those two countries are clearly perceived to be the shakiest of the Euro countries yet to fall (I consider Greece to have fallen in this context). Obviously there is debate as to whether this current event in Cyprus is significant or not and it seems like just about every not argument focuses on how small the country’s GDP is–we produce a new Cyprus everyday before lunch is one quip I read somewhere. Of course the size of the GDP is not really the issue. If this is going to be important it will be because how how large the banking system is, who owns what debt and whether or not there are any implications for something similar in any other countries. I certainly do not know whether this will be important or not but I do know that anyone who stops at how small the GDP is, is not looking at this thoroughly. As for my opinion I think this can be important for Europe and companies that rely heavily on Europe for revenues. Any countries or companies that don’t do a lot of business with Europe won’t be immune if there is a large decline but countries and companies that don’t rely heavily would be fundamentally detached. For many years I have been...

Winters Likes Watches

Barron’s interviewed David Winters who manages the Wintergreen Fund (WGRNX). Winters is generally well regarded as a stock picker and I would describe him as one to hold on to stocks as a long term investor. There was a lot of time in the interview devoted to his fund’s positions in Swatch (SWGAY) and Compagnie Financiere Richemont (CURFY) which both make watches. According to Morningstar, the fund had a combined 10.83% in the two companies. To read the interview it is quite clear that Winters believe the prospects for the watch industry are very bright. I believe Swatch has watches at all price points whereas Richemont skews to the high end. There was not a lot of detail about his optimism other than he believes the companies have pricing power and the extent to which these purchases are often emotional. The stocks have done well in the last two years. Richemont is up about 50%, Swatch is up about 30% (same as client holding XLY) and both were far ahead of the iShares All Country World Index ETF (ACWI). There are a handful of publicly traded watch companies in the world including Fossil (FOSL) and Movado (MOV) in the US but these are very narrow companies making essentially one type of product. I’ve read/heard a couple of different times people question the future of watches because of the ubiquity of smart phones which obviously greet you with the time whenever you turn it on. Personally I have no idea if that is a real threat to the watch business but it is an interesting question. That a company just...

Winters Likes Watches

Barron’s interviewed David Winters who manages the Wintergreen Fund (WGRNX). Winters is generally well regarded as a stock picker and I would describe him as one to hold on to stocks as a long term investor. There was a lot of time in the interview devoted to his fund’s positions in Swatch (SWGAY) and Compagnie Financiere Richemont (CURFY) which both make watches. According to Morningstar, the fund had a combined 10.83% in the two companies. To read the interview it is quite clear that Winters believe the prospects for the watch industry are very bright. I believe Swatch has watches at all price points whereas Richemont skews to the high end. There was not a lot of detail about his optimism other than he believes the companies have pricing power and the extent to which these purchases are often emotional. The stocks have done well in the last two years. Richemont is up about 50%, Swatch is up about 30% (same as client holding XLY) and both were far ahead of the iShares All Country World Index ETF (ACWI). There are a handful of publicly traded watch companies in the world including Fossil (FOSL) and Movado (MOV) in the US but these are very narrow companies making essentially one type of product. I’ve read/heard a couple of different times people question the future of watches because of the ubiquity of smart phones which obviously greet you with the time whenever you turn it on. Personally I have no idea if that is a real threat to the watch business but it is an interesting question. That a company just...

The Big Picture for the Week of March 24, 2013

Dylan Ratigan gave the world an update on what he’s been up to since leaving his show on MSNBC last June. In an attempt to find more purpose in his life he moved to San Diego county, invested in a hydroponic farm and is working at the farm (there is more to the story and what the farm is doing). He seemed to be influencing a lot of people with his show which seems very purposeful to me but I guess it wasn’t enough, he wanted to get his hands a little more into something (literally and figuratively). Purpose can be synonymous with passion or something we love doing which is is what I mean when I talk about post retirement careers or hobby monetization. Over the years I’ve posted all sort of examples of this in addition to what I am doing in this regard. Firefighting and writing about the stock market (my interests) won’t appeal to too many people. These sorts of back up strategies likely require more actual labor for less money than what people may have become used to during their careers. Anyone needing to be resourceful in retirement or cover their nut while under employed should be mentally ready to do whatever it takes. This leads me to an extremely unimpressive comment left on the blog yesterday about picking up cans on the highway. The reader came off as thinking they were entitled and somehow above ever having the type of hard time that requires someone to work below their educational background and previous job titles. Zero respect for the guy who looks down on other...

The Big Picture for the Week of March 24, 2013

Dylan Ratigan gave the world an update on what he’s been up to since leaving his show on MSNBC last June. In an attempt to find more purpose in his life he moved to San Diego county, invested in a hydroponic farm and is working at the farm (there is more to the story and what the farm is doing). He seemed to be influencing a lot of people with his show which seems very purposeful to me but I guess it wasn’t enough, he wanted to get his hands a little more into something (literally and figuratively). Purpose can be synonymous with passion or something we love doing which is is what I mean when I talk about post retirement careers or hobby monetization. Over the years I’ve posted all sort of examples of this in addition to what I am doing in this regard. Firefighting and writing about the stock market (my interests) won’t appeal to too many people. These sorts of back up strategies likely require more actual labor for less money than what people may have become used to during their careers. Anyone needing to be resourceful in retirement or cover their nut while under employed should be mentally ready to do whatever it takes. This leads me to an extremely unimpressive comment left on the blog yesterday about picking up cans on the highway. The reader came off as thinking they were entitled and somehow above ever having the type of hard time that requires someone to work below their educational background and previous job titles. Zero respect for the guy who looks down on other...