a99kitten's Musings

Blurb about John Thain, the former CEO of Merrill Lynch, from “Too Big To Fail”…

“In his junior year at MIT, when he interned at Proctor and Gamble, he made a simple but highly significant observation of an assembly line he was supervising. The workers were making Ivory soap, and whenever technical problems forced the line to come to a halt, they would wait for it to start up again before getting back to work. The college boy persuaded the workers that there was no reason to stop – they could keep making soap and stack the boxes on the side until the line came back on. That way their bonuses, which were based on production, would not be affected.”

Ok. So…after re-reading this and having a “fist of fury” moment (as my husband calls them as I really do shake my fist in the air in fury) at the pure unbelievableness of it, I asked myself so it took this boy genius from MIT to convince these workers, whose bonuses were based ON PRODUCTION, to keep making soap and simply stack the boxes to the side until the assembly line was working again so they could load them up? Really? THIS is what the heck people do when left to their own devices? And there was clearly no better supervisor previously to instill this little nugget of wisdom.

This is the type of thing that infuriates me. Mind-boggles me. And makes me NOT sympathetic to the (typically but not always) union worker bee who feels entitled to corporate profits, lifetime pensions and health benefits and whatever else they can get. I guess businesses really do need those highly paid MBA types…that way work can still get done, and workers can make their bonuses, when the assembly line stalls.

Filing under #unfrackingbelievable

Been reading “Too Big To Fail” and the biggest nugget I have personally garnered so far (besides that Paulson TOTALLY allowed Lehman to go down in flames much like I always assumed) is that you can not ever trust anything said by the government or media. Now, I already knew that but wow – this really pushes that home. Yikes. It’s not like I ever felt the banks were 100% responsible because everyone had their hands in the cheap money pie, and I have about 4 blog posts in my head about mortgages, and banks and F the government AND idiot and unethical borrowers but we’ll see if I blast those out anytime soon or just let it simmer down inside. But grrrrrr. People that blame the banks and mortgage brokers solely for all the problems in their world need to get a fn clue (after looking in the mirror.)

Ok, cleansing deep breath….turning on my Zen music and finding my Chi (or is that Chew…bacca?! :) )

Another thing the book has done is make me re-evaluate my stock portfolio a bit. I have a 401k account that I check in on monthly but my stock account I watch daily. Not that I am a day trader because I am not. Do not have the time or energy to do that anymore. And most of what I own are companies that I know of due to personally liking them or brand recognition or some such thing. I did take a flyer on 2 small positions at the beginning of the year on companies that were not in the above categories and so far they are doing well. My intention is to keep them for the year though and not long term investing like the rest. I consider myself an investor and not a trader, even though that’s the way more fun side of it :)

I made a couple of small day (really several days) trades earlier this year and did well. But then I bought a teeny 100 shs of Pandora hoping for a quick pop and missed. Lost just over a point before I quickly flushed it but that annoyed me. I knew better. I know Pandora is crap (from an investment perspective – have never tried the service) but I thought it would be fun…like the old days! Was hoping for a 3-5 point in 15-20 minute turnaround to put in my Jimmy Choo fund :) Oh well. Wasn’t a big loss in cash but VERY annoyed by the fact that I did it even knowing 100% in my gut that it was a bad call. Like – totally knew it. Grr. Dummy. So I nicknamed my stock account DUMMY (online you can have a nickname) until I feel less dumb. And I hate feeling dumb.

No, this current market is making me keep my money in the safer stocks for the time being. Not that they can’t go down, but I have a fair degree of certainly they will all come back just fine short of Armageddon…and then I guess I will just need my gold and guns. Companies like MCD, YUM, TIF, AXP, BRK (B), AMZN, AAPL, SBUX, BP, VLO and some others. I also bought some fairly distressed GE and MS a short while back which hasn’t done too much but I think long-term they will also be fine and might even buy more under 20 and 24 respectively.

I do own some BAC and C which both stress me out a bit since they are technically too big to fail and yet totally can. But that’s the gambling side of my account I guess. I’m flat on both of them right now so we will see how I feel if I see much red. Although, I do tend to think they will go up somewhat at least, it will just take some time. That feeling thing. BUT, by the time I finish “Too Big To Fail”, I might change my mind and scream SELL MORTIMER as I can’t push the button fast enough!

I recently bought a healthcare stock – which I normally stay away far away from and also have a couple AG and commodity play stocks. I got rid of my ETF’s (except SLV) as I really prefer to own the underlying securities. ETFs are boring an way too many layers of even more people involved that you can’t trust. Though I do pat myself on my back for selling my USL at almost the very top of WTI prices. Genius oil speculator without even knowing it! I prefer to own the underlying asset in SLV too (and do) but I bought my shares at 17 so I’ll just keep it for now. Plus hoarding physical silver takes up a lot more space than gold so its OK to have both real and paper in that :) unless of course you believe all the conspiracy theories about silver (like the gold conspiracy theories) which honestly, after you read about the banks, are harder to just pushaw away. A good conspiracy theory keeps you on your toes anyway.

Yes, this investor went more Scrooge McDuck than Gordon Gekko during May and now June. Getting kinda ugly out there…and part of me says well, the fastest way to get Obama out of office is to keep it rather ugly out there so who knows….