Greece

In the same conversation as the Dubai meltdown, Greece has been mentioned by many as the economy on the least stable footing.   However, Greece does not have a family member willing to pony up billions to keep things in tact.  It appears that much of their hope lies with the IMF. However, the IMF might not have the financial wherewithal to do so.

The idea that they might be in trouble is one thing, the fact that they are falsifying data is an entirely different deal.

In a damning report published as the eurozone grapples with its worst financial crisis since the euro’s launch in 1999, the Commission said figures from Greece’s were so unreliable that its budget deficit and public debt might be even higher thangovernment had claimed last October.

FT.com / Europe – Greece condemned for falsifying data.

The Federal Reserve Bank of New York, then led by Timothy Geithner, told American International Group Inc. to withhold details from the public about the bailed-out insurer’s payments to banks during the depths of the financial crisis, e-mails between the company and its regulator show.

AIG

via Geithner’s New York Fed Told AIG to Limit Swaps Disclosure – Bloomberg.com.

My hunch is that there is some validity to the counter suit by Apple and there will be a settlement that might not even include licensing fees.

This might just take years to play out unless a judge decides that he/she wants to make a name for themselves.

Nokia opens new front in Apple patent battle| Reuters.

U.S. banks that spent more money on lobbying were more likely to get government bailout money, according to a study released on Monday.

via Banks with political ties got bailouts, study shows | Reuters.

Choices

1. I slap you in the face
2. I kick you in the shin
3. I take all of your money

…Get the picture?

Read the excerpt below.  Lovely.  The link to the full article continues below.

We still face serious headwinds in the economy and, as I’ve said many times this year, the current market valuations are ignoring the risk factors of owning equities – an amazing thing considering how recently those risk factors showed up and bit people’s faces off both last fall and this spring.  For example, according to the NYTimes this morning,  American International Group, Fannie Mae, Freddie Mac and GMAC, are not only unable to repay the government, they are in need of continuing infusions that make them look increasingly like long-term wards of the state.  The total risk they pose to the taxpayer far exceeds that of the big banks. Fannie and Freddie, in the final days of the year, are even said to be negotiating with the Treasury about greatly expanding the money available to them.

via Fa La La Friday – Scroogy Swap Prices Blacken Christmas | Phil’s Stock World.

But right now, it doesn’t feel very funny. Can we get some new leadership at this company?

GLW should be a core long term holding in your portfolio.  They had a little hiccup in share price about 6 weeks ago (down to the mid $14’s) but have moved up about 25% since that point.  It was kind of odd that they sold off, because Corning has made it a habit over the past few years to pre-announce in a way that essentially says that they are on track.  That is what they did on 10/22/2009.  After that announcement, they sold off about 7%-8% within a week.

I wish that I would have taken the opportunity to add to my current position.  Let me reiterate why GLW is a great long term buy.

A leader in the following core sectors:

• LCD
• Filtration Systems
• Fiber

Corning - GLW

Those three sectors alone are fantastic long term plays.  We haven’t even seen the real impact of climate regulation and the continued move toward larger and flatter TV’s, monitors, and devices will allow the LCD division to generate plenty of cash.  Let’s not forget about our constantly growing demand for bandwidth which ultimately leads to more fiber.

There are plenty of other markets that Corning is entering with plenty of R&D money.  This is a smart long term play.

Forget the amount that they just gave up (primarily so that Citi could freely pay its year end bonuses out), this could cost many billions in the future.

The federal government quietly agreed to forgo billions of dollars in potential tax payments from Citigroup as part of the deal announced this week to wean the company from the massive taxpayer bailout that helped it survive the financial crisis.

via U.S. gave up billions in tax money in deal for Citigroup’s bailout repayment – washingtonpost.com.

He is considering buying a business for about $3o0,000 and expects to cash flow about $65,000. That’s if he and his wife each put in 40 hours a week!

What would you do? I responded by asking if he knew how much 3% of 8.8 million was. He is a blue collar worker and probably earns about $40,000. He come upon 8.8 million in inheritance and wants to know what to do. Can you imagine? Anyway, I told him that 3% of 8.8 million dollars is $264,000. The reason I told him that is because if he puts his money in an annual interest bearing account and gets 3% interest, he can take $264,000 every year and NEVER touch the principal. In 400 years, he’d still have 8.8 million dollars. If he got 7% interest, the numbers get silly to the tune of $616,000 annually. If he takes only $250,000 and banks the rest of the $616,000, His 8.8 million turns into over $45,000,000 in 20 years. Remember, he is still taking home $250,000 annually!

For some of you, $250,000 isn’t enough to live on. For him, he’s in his mid 30’s and has gotten used to living on $40-$70K a year (wifes income added). At a minimum, it’s an almost 4x increase in annual income.

I advised him to sit on the money for awhile. I hope he doesn’t do anything hasty…like buying a 40 hour pain in the butt pet services company so he can add an extra $3-4K monthly to his $50 million he’ll have by the time he’s 55.

US foreclosure filings will hit 3.9M in 2009, bringing the 3-year total to 10% of all US homes.

Foreclosure heat map

via Foreclosure Thursday – The Stealth Stimulus | Phil’s Stock World.