July 30, 2014

A Basic Overview of Corporate Inversions

US Corporate Tax Form

There has been a lot of talk over the past few days of corporate inversion.  Corporate inversion happens when an American company changes its domicile to another country by merging with a foreign entity.  Inversions have been occurring at a rapidly accelerating rate.  Pfizer attempted one of the largest inversions in history with the AstraZeneca merger that ultimately fell through.  AbbVie, one of our biggest medical companies is about to defect to Ireland through an inversion.  Walgreens is seri … [Read more...]

I Just Looked Up the Cost of an Education At My Alma Mater

Alma Mater

This May will be 10 years since Aaron and I graduated from university.  I just looked up the cost for the upcoming academic year, which includes tuition, room, board, fees, and books, and it's running at a rate of around $53,000 per annum.  Assuming even modest annual increases, a 4-year degree would cost just shy of $252,000 per person before scholarships.  That means to get the same two degrees before financial assistance, Aaron and I would have had to spend almost $504,000.  It's madness.  Tot … [Read more...]

Frugality Friday – Saving Money By Getting Your Clothes and Food for (Practically) Free

Refashionista Transform Two

I stumbled across a blog called ReFashionista.  The woman who runs it goes to thrift shops and finds horrible old clothes and transforms them with her skills into new outfits that cost practically nothing.  The readers then vote on the results using a star system beneath the posts.  She has more than 225 pages of content showing what she has accomplished.  Here is a typical example of her work.  You can click the pictures to be taken to her blog: This sort of thing makes me overly exci … [Read more...]

Moroccan Trade Routes and Lines of Credit

Civilization Morocco

I spent my morning taking the Moroccan empire to victory against the world thanks to an extensive network of highly lucrative trade routes before going to the bank with Aaron to sign the contract for a new working capital line of credit our banker recommended.  The whole experience was a pleasant surprise.  The banker suggested it during a routine meeting, the rate is dirt cheap (especially on an after-tax, inflation-adjusted basis), and the underwriters came back and gave us 60% more than the am … [Read more...]

Playing Good Financial Defense Can Sometimes Be Worth More Than Good Financial Offense

TaylorMade JetSpeed Driver Set

It's time for what has become an annual reminder on the nature of building wealth: The importance of playing good financial defense.  Roughly 1 out of every 3.7 people reading this post earn more than $100,000 per year, or twice the median household income in the United States; some of you exponentially more.  This is a community of people who know how to make money, in various forms, from a myriad of activities. If you haven't learned the flip side of the coin - how to stretch that money so i … [Read more...]

You Need to Read the 2013 M&T Bank Corporation Annual Report

M&T Bank Annual Report

The Internet problems we have experienced over the past two weeks began again, today, to the point we had to stop working.  There was a huge stack of annual reports that had arrived in the mail from those single framed stock certificates I acquired back when we started our first company, and so I grabbed one and started going through it to at least be productive.  It was the 2013 annual report for M&T Bank Corporation. If you aren't aware of it, M&T Bank is exceptional.  It is one of o … [Read more...]

Don’t Give In To the Siren Call of Leverage

Ben Graham Security Analysis Leverage

So much misfortune in life can be sidestepped if you simply make it a rule to never stretch your finances, yet it's a rule I see violated more than any other both through observation of those around me and through the messages I receive.  Someone can afford a $150,000 house but they try to buy a $250,000 house.  Another can realistically go to a college that will cause them to graduate with $10,000 in debt but they want to sign up for the program that will put them $40,000 in debt.  Then, not on … [Read more...]

Eli Lilly and the Insanity of Foreign Taxes

Eli Lilly Repatriation

I'm going through the corporate bond filings of pharmaceutical giant Eli Lilly just out of curiosity.  They have a huge patent cliff coming up, during which time as much as 40% of their revenue base will be exposed to generic competition.  I wondered what it would do to the risk metrics on the senior bonds so I pulled the Moody's rating and reading over the figures as I listen to an old 1970's song called Snookeroo. Side note: The song is interesting.  After the breakup of The Beatles, Ringo St … [Read more...]

My Objective: To Take $2.4 Million from the Stockholders of KCPL Over the Rest of My Natural Life Expectancy

KCPL

Since the energy saving program 4 months ago, the real world results are exceeding projections.  Thank you, again, to those of you who wrote me with suggestions!  I estimated that the energy efficient light bulbs alone would save an average of 288 kWh per month, or 3,456 Kwh per year.  They are actually saving 317 kWh per month, or a run rate of 3,804 kWh per year.  That means my net cash savings are around $410 per annum. Over the next 25 years, if I put it to work at average rates of ret … [Read more...]

Bing Is Offering Gift Cards and Rewards If You Use Its Search Engine!

Bing Rewards

You all know I love to save money.  Microsoft is so eager to grow its search business that it has a Bing Rewards program that lets you earn all sorts of free stuff if you take a few seconds to setup an account.  Whenever you search, you accrue points.  For example, 525 points gets you a $5 gift card to Burger King, Game Stop, or any number of other places.  Someone who spends several hours a week on a computer could pocket quite a bit of free money or rewards over several years without any real c … [Read more...]