Finance Books

I recently wrote a StockBoxFinancial.com article about a book called the Future for Investors. I have to say I thoroughly enjoyed the book and I think I will look to employ the strategies laid out by Professor Siegel in the future. I usually really enjoy finance books, and I often fall victim to purchasing several books every year. I have to say this is one of the biggest detriments to my overall returns, but I rationalize it b/c they are books and maybe they will help me generate even higher returns in the future. Right now there are several books i have my eyes on:

• The Path to Wealth through Common Stocks by Philip A. Fisher
• Poor Charlie's Almanac by Charlie Munger
• The Alchemy of Finance by George Soros

Just to name a few. Currently I learning all about ETFs through The ETF Book by Richard Ferri. This is an excellent book and I recommend it to anyone who is looking to learn more about exchange traded funds. Hopefully as StockBox generates more and more revenue I will be able to by more and more books...that's all for now...I'll be back with more later

Microsoft Buy Yahoo...Maybe there are Better Options

Much has been made about Microsoft's potential bid for Yahoo. I understand why Microsoft made the bid, but the bid was too high and I feel that Yahoo's board made a ridiculous move not to accept the deal. After all, their stock price is in decline and so is their business and Microsoft gave Yahoo shareholders a way out. A recent article in the NY Times presented a much different option for Microsoft: Instead of diworseifying by acquiring Yahoo, which has little to no competitive advantage over Google and other firms, Microsoft should go after SAP. SAP, which is a provider of semi-custom business software, would give Microsoft a great advantage over Cisco especially as more and more corporations in developing nations demand their services. Also, as SAP is quickly losing ground to rival Oracle, the German firm's shareholders may gladly welcome the deal.

I guess we'll have to see how the whole situation plays itself out. As a shareholder I am going to view this spectacle from the the sidelines as the market is too unpredictable for my tastes.

The Credit Crisis

The current credit crisis, which is as widely known as the Giants Super Bowl win, continues to plague our economy. However, many people and even some investors do not really know what the current state is regarding debt and the insurance of. Jim Jubak wrote a great article highlighting the current state of the credit crisis and what the banks, the Fed, and the state of New York are doing about it. Jubak predicts that these facilitators will be able to solve our problems in the near term (not without significant write downs, of course) and return our economy back to it's normal growth rates. If Jubak is right there will be massive write downs in the next year or so and then the economy will get back on track.

As an investor I have been looking at various financial companies and many of them are quite cheap with regard to traditional metrics, but I am just not sure how many more write downs will occur. Frankly, I don't think anyone knows. The one company that I have examined as a potential investment in the financial industry is Goldman Sachs. This company is the best at what they due and successfully avoided the whole sub-prime mess, but now there is even talk that this financial bank another 2.7 billion dollars in loans and credit derivatives. Also, analysts are slashing their forward looking earnings estimates by large margins and the company is slashing its work force at a rapid rate.

I do think that Goldman is a great company with excellent long term potential, but I don't believe now is the time to build up a position in the financial giant.

For now I am shying away from the financials. In the future, as the credit crisis plays itself out I definitely will give Goldman a closer look.