Tuesday, August 30, 2005

Would you like an infinite return on your investment?

Would you like an infinite return on your investment?

Its mathematically possible. All you have to do is find a way to invest in something that you pay nothing for and have it give you a return. (basic math: if you divide anything by zero you get infinity)

I do not have cash. That is no secret. It takes money to make money. That is no secret, and is often an excuse for not investing.

But it does not take YOUR money.

I invest (in Real Estate) with other people's money. OPM. This gives me an infinite return.

People say you need 15-20% down for an investment property. What they never tell you is it doesn't have to be your money.

Granted, I don't borrow from friends or relatives. My dad is not giving me down payments to buy houses. Banks are.

Use credit for down payments. It doesnt cost you any cash. Have the seller pay closing costs. You'd be surprised how many sellers are willing to pay closing costs instead of lower the price an extra 2-5k.

There are many ways to do this, ranging from alot of risk, to very little risk.

Follow this strategy, but always be sure that you can cover your costs. People can get really aggressive doing this (e.g. variable rate loans). Be smart about it. Make sure you can cover your payments, at all times.

Then you will know how good it feels to have infinite returns.

Wednesday, August 24, 2005

Chartering a comeback?

If you read this blog regularly you know I have an odd affinity for following Charter, but I never know whether to be long or short it, so I just sit on the fence. (Click Here for past postings re: CHTR.)

Charter is fascinating because they have the products in place to dominate, innovate, and revolutionize Internet, advertising, marketing, telephony and television. I firmly believe they could eliminate commercials and replace it with product placement.

But they don't know how to run themselves.

From my observation it seems the stock price is driven rather strongly by news announcements.

As of this writing CHTR is up 37% today...(which if you still hold from when it was in the 15s, you're saying "who cares!"). Why so much? They have announced that they are restructuring some of their insane debtload.

Does that justify a price increase? Nonetheless a 37% price increase? I don't think so. I think the prospective shareholders just wanted to hear something, anything regarding their debt.

Here's what they did: They are issuing a private placement of debt. (What's this mean? You have to make alot of money a year, or have a net worth of 1 million to be able to buy the soon-to-be issued bonds). The proceeds will pay off the publicly held bonds. The new bonds will have a longer maturity.

I say so what. You still have 18 Billion in debt. (off the top of my head I think its 18 Billion, don't fry me if I'm wrong on that!). I still think the way to fix Charter is to improve morale, improve operations, attack the debt, and innovate.

There are other ways to get rid of their debt. They could issue stock to finance paying off the debt.

Instead they chose to move their debt from one group to another.

Let's watch and see what happens!

*****************Update 8/25, 10:26am**************************

This is in response to the first comment to this post....hopefully this adds some useful info:

I'm not a finance major either...I'm a common sense major.

If they reduced their interest rate that would be very significant...but they are extending the maturity and keeping the same coupon rate (aka interest rate).

The most significant thing they are doing is moving the debt from the public to only accredited investors.

accredited investors = To qualify as an accredited investor, an investor must either be: A) a financial institution; B) an affiliate of the issuer; or C) an individual with a net worth of at least $1 million or an annual income of at least $200,000, and the investment must not account for more than 20% of the investor's worth.

This has to have been done for a reason, unless it was just action for the sake of action.

I would not be surprised here if a hedge fund, or Paul Allen bought up alot of those Private Placement shares similiar to what happened to Kmart. Bondholders have liquidity rights before the stockholders....so if Charter starts to liquidate shares, the bondholders have first dibs at the proceeds. And Charter has assets in its infrastructure which could be sold to another cable company or SBC.

We'll sit back and watch.

Tuesday, August 23, 2005

Apocolyptic TelEvangalist

Pat Robertson, you are insane. Read more here

Apparantly if you are on TV and believe in Christ, you become as powerful as Renaissance-Era Papal figures.

Don't get me wrong, I am all for killing people that ought to be killed. (Granted I don't want to do the killing, but I am a-ok with capital punishment). But then again, I do not have a few million sheep, I mean people, following me in the name of Christ.

This dude represents salvation to people who need him. His is not the role to say that someone should be assasinated. He is condemning someone for hate, when condemnation is hate.

Why did he leave off Bush? Jesus wants Bush dead...because Bush kills more people than this Venezuelan president.

Dammit, I just realized whats going on!....Robertson is like that creature from the movie IT. He is only powerful when people think and talk about him. I just did that! Whoops.

Sunday, August 14, 2005

University of Misery Alumni...you are idiots.

I am dismayed. Is everyone stupid? Is everyone retarded? Don't people see their stupidity?

I received a letter today from the curators of the University of Missouri. (They also somehow knew that my sister was my sister and mailed a letter to her to my address because they couldnt locate her in Argentina). The letter addressed a proposed settlement of a class action lawsuit.

You see there is this document somewhere that says that the U. of Missouri can not charge in-state students tuition. Well for a few years they inadvertantly called it tuition, instead of "education expense." Simple semantics.

So what do the bright people of Missouri do? They sue.

But who are they suing? They are suing themselves. IDIOTS!

Let's look at what happens when you sue yourself. You are paying for your lawyers. Your tax dollars are paying for the defendants lawyers. Your "winnings" are coming out of your tax dollars!

Let's say I am entitled to 5k net. my lawyer costs 2k, and the defendant's lawyer costs 2k. Congratulations me!....I just "won" 9k at an expense of 9k...which that expense is to me!....(spread out over a million tax payers).

Plus this spans 1995 through 2001. I would assume that there were a couple hundred thousand students that paid "tuition" in that time frame....(there are 4 major campuses) I don't know how much the settlement is for, but the tax payers of Missouri are certainly going to be losing a nice chunk of change that could have fixed a highway, or used to clean up downtown St. Louis.

Who in the hell is so stupid that they sue themselves? My fellow U. of Missouri alum.


Press Release

The letter I received was misleading. The above press release shows that the settlement includes scholarships and not cash. While it is still going to cost the tax payers the cost of the defendant's lawyers, the prosecution, and administrative costs of teaching several thousand people for free...I am much more ok with that that cash reparations.

Friday, August 12, 2005

You get paid how much to play a game?

Terrell Owens, you are gay.

You get millions of dollars a year to play a game.

All you have to do all day is practice and train.

Yet you talk.

Yet you ask for more money after you already signed a contract for more money.

You talk shit to your quarterback!....the guy who controls your output!

Winners win, talkers talk.

You and A-ROD should be buddies. Both of you have immense talent. But both of you are so concerned with yourselves that you will never bring a team to dynasty level. Like AROD, any team you are on is saturated with talent, yet they lose. What is the commonality? Your selfishness.

It is a team sport. It is a collaborative effort of men working together to reach a common goal. Unfortunately you and AROD have a common goal of making a few more dollars than everyone else at the expense of commaraderie.

Congratulations, your team hates you...not because you are the best, but because you bring them down.

Sunday, August 07, 2005

For all of those who take the time to write comments on this blog....

Thursday, August 04, 2005

Lack of posts....

I went on vacation last week, and it was great....so great that I haven't had anything to rant about.

I'm sure that'll change soon.

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