2.57 trillion is just not enough

February 7th 2005

Hello,

2.57 trillion dollars now that’s a lot of money. No matter how you slice it is just a whole lot of money. Even though we are spending too much, we are not spending enough. Even though we have a deficit we can’t make any cuts: I know I can’t figure it out either. Only in Washington is a smaller increase in spending considered a spending cut. Only in Washington is the largest government budget in US history not enough. A recent New York State Quinnipiac Poll stated that 64% of New Yorkers trust Hillary Clinton, no wonder the Governor has proposed selling the Tapanzee Bridge I think the State will find many willing buyers. Apparently the Iraqi’s have picked up on this democracy thing better than we thought the first election in 5000 years and there are already accusations of ballot box tampering .The Bush administration has sent observers from Dade County and a special envoy from Chicago, Bill Daley.

The companies in the S&P 500 had the biggest earning increases in more than a decade. While the twin deficits of trade and budget which have so captivated the main stream media seem to be subsiding .Valentines day 2005 gives us more of corporate America seeking partnerships. There are mergers, mergers every where .This whole market has a 1980’sish sort of feel. The over capacity generated with the tech bubble 1990’s is getting soaked up through mergers and acquisitions. I don’t think you will see the reemergence of the LBO as a major tool, but the days of the “nice guy” 1990’s are giving away to the “kick but and take names” attitude of the 1980’s. It looks to me like software and telecom are the main targets.

This week brings us another big lesson for individual investors: beware of the over hyped CEO, Carly Fiona has resigned as the CEO of Hewitt Packard .The super star status of a CEO is often a harbinger of doom for stock holders and Carly was no different, pursuing a skeptical strategy with poor execution. If your CEO is busy showing up on “Opera” or decorating the covers of various magazines, it means they are not putting in the time to run the business. Carly is not the first and I am sure she wont be the last, “rock star” status just doesn’t seem to deliver return to the shareholders.

I am so glad Paul McCartney keep to his word and kept his clothes on for the Super Bowl half time show. A naked 62 year old was not something I was looking forward seeing.


James

www.jamesfoytlin.com

http://onesmallvoice.blogspot.com/