Fabien Hug

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    • Tue Dec 2nd 09:18 AM
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      A Little Known Fact, And Good News, About This Crisis
      This deduction has nothing to do with this mess. In Switzerland you can deduct all you debtor interests from your income (even car and credit cards) and there is no such mess. I mean it is just fair that if you pay taxes on investment income you should be able to deduct all your borrowing costs. Give the taxpayer a break.
      Now, if people didn't have to get a home equity line of credit to purchase consumer goods in order to get a deserved tax deduction, the problem would certainly be less acute.
      Second, it is the job of the banks to allocate the money. A key rule when lending is the ability of the borrower to pay back, not the collateral given as a guarantee. If banks respect that rule, you don't have this problem.
      Third, the second point doesn't matter if banks don't keep the loan in their books. Nobody cares, only collateral matters and it's hell when collateral values drop.
      Fourth, if I take your example with a TI of $ 200k and a rate of 40% you'd pay $ 80K in taxes. Now if you drop your TI to $140K by borrowing and maybe you also drop you tax rate to 30% you'd pay only $ 42K in taxes. A tax saving of $ 38K against an interest payment of $ 60K which brings your cash flow down with $ 22K.
      Now the question you should ask is; is my investment going to yield more than $ 22K a year?
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    • Sun Nov 30th 19:00 PM
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      U.S. Stocks Look Like They're Still Headed Lower
      FB 5000, I'd like to read more articles based on your assumptions. On one hand we have those who predict more doom without taking into consideration the huge amounts of money that are force fed into the economy (OK so far these amounts have been used to repair balance sheets but it is still a lot of money) and, on the other hand, some cry for more (see Baron's article in today's SA) and then what. Nobody seems to care or maybe it is not the place to care.
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    • Sat Nov 29th 21:13 PM
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      Stocks: Is the Tide Turning?
      You wrote an interesting article about the state of the bond market. This article doesn't present a very optimistic view and kind of contradict what you wrote here.
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    • Sat Nov 29th 21:02 PM
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      Three Reasons Why the Dollar's Not Yet Done
      OK with the $ analysis but if you want to buy smthing from Everbk, check it out well; you have the risk, they keep the margin.
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    • Thu Nov 27th 11:23 AM
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      Service-Based Economy Is Progress? Show Me the Money
      Very interesting article. Quickly about "free" markets; if free markets function (based on the behavior of its participants) why am I not free to drive at the speed I consider the most efficient, why am I not free to smoke what and when I want at a rate that gives me the most satisfaction? Simply because participants are fundamentally never satisfied. What doesn't work for the society will certainly not work for the economy.
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    • Mon Nov 24th 21:57 PM
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      Quoting Peter Schiff: Not a Crisis, A Collapse
      Yes it is really worrisome to look at that video. His opponents are and look so stupid and they are on national TV giving financial advice. It really drove me nuts. Stein is the only one who tries to come with rational arguments and a discussion (he is so always naive and optimist).
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    • Sun Nov 23rd 10:00 AM
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      How Impossible Is Market Timing?
      What if you ask yourself the question why to buy and why to hold?
      Do you buy for capital gain or for dividend? As long as you get what you want you hold, otherwise you sell. I bought WM at 15 in 1998 and hold all the way because it was paying dividends. I could have sold at 45 in 2007 and then what. Where do you put the money? A CD? I already had a full CD allocation. I finally sold WM at 15 in 2008 when they cut the dividend.
      I don't cry over the money I haven't made because it could have gone the opposite direction as well when you read about the economy in early and mid 2008.
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    • Sun Nov 23rd 09:50 AM
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      Bond Market: Unsafe at Any Yield?
      What is best now, junk bond or junk stock? In general, I think you are better of with a junk bond for the portion of your assets you want to allocate to financial instruments. Interest and redemption must be paid and the potential upside in price is a big as for the stock. Now if you choose the wrong company, the risk is the same as the stock.
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    • Sat Nov 22nd 09:43 AM
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      Geithner!
      If you think that somebody from the system will cure the system...
      As far as I can read on this blog a lot of people have identify the problem correctly. Now to effectively correct it, this another story. If everything goes well, all the money injected will allow us to have another nice run, the same with new faces at the lead until next time.
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    • Tue Nov 18th 18:48 PM
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      Commented on:
      The Baltic Dry Index: One Economic Indicator Worth Tracking
      Good tip. Thanks .
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    • Tue Nov 18th 08:51 AM
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      Rating: 0 -1
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      Economic Distress and Geopolitical Risks
      The problem with military budgets is that when you buy all these toys you want to use them. One one side, I don't see a global threat neither from Russia nor from China. There is a effectively a risk that a future Pakistani launches an atomic bomb (let's use the toy) or that Russia gets nostalgic about Ukraine or anything else (Ukraine would not be fun since I think they still have the third atomic arsenal in the world courtesy of former UDSSR). However, a real threat like a Japan/Germany alliance with enough manpower and technology to threaten the States is out of the question.
      Now, see how much is spent to control two military small countries like Irak and Afghanistan and you quickly see that it is useless to try to control the world. What will be will be and, in the meantime, keep your money close.
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    • Mon Nov 17th 15:43 PM
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      How Long Until the Bulls Regroup?
      Bad, bad, bad but very good article.
      Thank you
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    • Sun Nov 16th 10:31 AM
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      Four Reasons Stock Market Hope Will Overcome Despair
      I took us many years to come here. Things went out of control after 2001 and, as per what I read, lax monetary policies started long before.
      So, if I appreciate some optimism, I still doubt things will get that rosy after less than a year of reevaluation and I think that athena comments are short and straight to the point.
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    • Tue Nov 4th 09:30 AM
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      Dollar Tsunami: The Wave May Be about to Crest
      If you sell your dollars what do you buy? Gold OK but you can't put all your money in gold. What else? EUR same problems, JPY nobody knows what they are cooking. CHF so little available. NKR same as CHF. Furthermore, problems in the States just anticipate problems elsewhere.
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    • Sun Nov 2nd 09:50 AM
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      Get Ready to Buy Like It's 2002
      I like this article. Perspective is provided and it put the finger on something that was eluding me. Trying to guess what will happen next, as Dr. O mentions perfectly, cos. will be back to SOLVENCY thanks to various injections of money, but solvency only. In order for the markets to punch back, I think that more than solvency will be needed. As a matter of fact, don't forget that the last market boom was fueled by cos. going into INSOLVENCY. Are we going to repeat that feat? I don' think so for the near future. I would expect a lot of volatility in the future fueled by hope followed by disappointment.
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