Back when chip giant Intel (Nasdaq: INTC) was new and no one had invented the Internet, computers were huge machines that could each take up an entire room. #-ad_banner-#Intel’s ideas seemed like an abstraction, but it eventually became the default standard in computing innovation, and went on to invent the x86 set of microprocessors that are now found in most computers. An investor would be hard-pressed to find a technology company that has done more than Intel to shape the world of semiconductors that are the building blocks of modern computing. But… Read More

Back when chip giant Intel (Nasdaq: INTC) was new and no one had invented the Internet, computers were huge machines that could each take up an entire room. #-ad_banner-#Intel’s ideas seemed like an abstraction, but it eventually became the default standard in computing innovation, and went on to invent the x86 set of microprocessors that are now found in most computers. An investor would be hard-pressed to find a technology company that has done more than Intel to shape the world of semiconductors that are the building blocks of modern computing. But today another company may represent the future of chips. The world of computing is on the brink of another sea change — the age of digitally connected devices, the so-called Internet of Things. Some optimists say the Internet of Things could be a new industrial revolution that will link up 50 billion devices together and generate up to $5 trillion in revenue in less than a decade. But the world of the Internet of Things is a lot more than tablets and smartphones talking to one another.  According to the invaluable tech resource WhatIs.com: “A thing,… Read More

The Federal Reserve’s new leader had her “irrational exuberance” moment in her most recent congressional testimony.  #-ad_banner-#Boy, am I glad she got that out of the way. Janet Yellen’s predecessor Alan Greenspan uttered those two words back in 1996, and like him, Yellen seemed to be trying to jawbone stock prices down before they form a bubble and scuttle central bank policy. In 1996 after Greenspan’s remarks, stocks went into a temporary tailspin the next morning — yet an investor who ignored his advance and bought into the S&P 500 a day later has earned a 268% return… Read More

The Federal Reserve’s new leader had her “irrational exuberance” moment in her most recent congressional testimony.  #-ad_banner-#Boy, am I glad she got that out of the way. Janet Yellen’s predecessor Alan Greenspan uttered those two words back in 1996, and like him, Yellen seemed to be trying to jawbone stock prices down before they form a bubble and scuttle central bank policy. In 1996 after Greenspan’s remarks, stocks went into a temporary tailspin the next morning — yet an investor who ignored his advance and bought into the S&P 500 a day later has earned a 268% return since then. Likewise, Yellen probably created a big opportunity this month when she trashed biotech and social media stocks in general, saying they have “overstretched valuations.” Stocks sold off on her remarks.  The problem with a statement that lumps together all the stocks in a sector is that you end up throwing out some gems along with the high-flying duds. I’m not sure about social media stocks, but I do know there are at least three biotech stocks out there with the kind of hyperbolic growth and profit potential that justifies their rising share prices.  Three biotech stocks that should… Read More

Talk about history repeating itself…  #-ad_banner-#The term “banksters” originated in the 1930s, and it was used to describe dishonest or greedy bankers at the height of the Great Depression. Fast-forward more than eight decades, and the term has been dusted off to describe the executives at some of American’s biggest banks who helped precipitate the 2008 financial meltdown by using impossibly large amounts of debt leverage and creating worthless synthetic derivatives that turned customer dollars into casino chips. Some of the abuses by reviled modern-day banksters have been curbed. But the largest U.S. banks have few friends remaining, and their… Read More

Talk about history repeating itself…  #-ad_banner-#The term “banksters” originated in the 1930s, and it was used to describe dishonest or greedy bankers at the height of the Great Depression. Fast-forward more than eight decades, and the term has been dusted off to describe the executives at some of American’s biggest banks who helped precipitate the 2008 financial meltdown by using impossibly large amounts of debt leverage and creating worthless synthetic derivatives that turned customer dollars into casino chips. Some of the abuses by reviled modern-day banksters have been curbed. But the largest U.S. banks have few friends remaining, and their business models are under assault at nearly every level by regulation and digital innovations. Today, one of the few things worse than being a victim of banksters is being a long-term shareholder of three of the biggest U.S. banks — Bank of America (NYSE: BAC), JPMorgan Chase (NYSE: JPM) and Citigroup (NYSE: C).  Their businesses are likely facing an accelerating decline… and possibly, the point of no return. In fact, big banks seem to have woken up lately with targets on their backs — perhaps they are going from “too big to fail” to “too big to miss.”  It’s not… Read More

The United States has a corporate tax rate of 35% — the highest in the developed world, and not exactly a competitive advantage for companies trying to return profits and value to stockholders. It may seem unlikely, but there is actually a way for smart investors to profit from this high tax burden. #-ad_banner-#It involves following the logic of billionaire hedge funder Bill Ackman in his bruising takeover battle for Allergan (NYSE: AGN). (It is so promising that fellow hedge fund rival John Paulson is joining forces with Ackman on this deal.) The secret to Ackman’s strategy is that he… Read More

The United States has a corporate tax rate of 35% — the highest in the developed world, and not exactly a competitive advantage for companies trying to return profits and value to stockholders. It may seem unlikely, but there is actually a way for smart investors to profit from this high tax burden. #-ad_banner-#It involves following the logic of billionaire hedge funder Bill Ackman in his bruising takeover battle for Allergan (NYSE: AGN). (It is so promising that fellow hedge fund rival John Paulson is joining forces with Ackman on this deal.) The secret to Ackman’s strategy is that he is using a Quebec pharmaceutical firm as the takeover vehicle. The name of this company is Valeant Pharmaceuticals (NYSE: VRX), but that’s only incidental to this story. The real story is that Canada’s corporate tax rate is 15% — less than half of the U.S. rate mentioned above – and other developed countries share a similar tax advantage. Presuming Ackman’s hostile takeover happens, it means that when Allergan’s tax domicile moves from the U.S. to Canada, Allergan’s corporate tax burden — the company paid $519 million in 2013 — will go way, way down in future years. The resulting gain… Read More