This week in business brings the debt limit negotiations to a climax, and the dog and pony show probably will result in a deal. As I reiterate, the work product on everything government does follows the same format. Wait until the last minute and throw something against the wall to cut a deal. Is it any wonder why government's are so inefficient, especially the bigger they get? The problem with the debt issue is they are messing around with defaulting on government debt, and the ramifications are just incredibly bad for every financial market.
Another really bad situation is the whole News Corp. scandal in England. If ever the rule don't beat yourself applies, this one is it. Why would an executive of an 168 year old popular newspaper engage in something this dumb, and criminal? You have to wonder is the newspaper business that competitive, do readers and ratings matter that much a top newspaper has to engage in criminal behavior on the highest scale and in a completely unethical manner? Is digital competition forcing these competitive pressures all over the world, or just in this circumstance? Interesting questions, but I say, the leadership was just incredibly dumb.
Interesting story on the issues of digital health records- http://www.nytimes.com/2011/07/17/technology/assessing-the-effect-of-standards-in-digital-health-records-on-innovation.html?pagewanted=2&ref=business
A feel good look at three manufacturers in different industries surviving and thriving by being smart, productive, and innovative: http://seattletimes.nwsource.com/html/businesstechnology/2015614315_manufacturing17.html
A startup called fundraising.com has success in the non-profit space- big opportunities there-http://www.bloomberg.com/news/2011-07-15/fundraise-com-to-streamline-giving-sign-presidential-campaigns.html
Looking at a tale of two countries raises very interesting questions about society going forward: http://techcrunch.com/2011/07/16/tale-of-two-countries-silicon-valley-unemployed/
This will be an interesting week as one would expect a debt deal to get done, and earnings from large corporations stream in- as always, some surprise, some disappoint, and the market will react, and then some, to all of it.
As always, on any company mentioned here, past performance is not a guarantee of future returns. One should research any investment and make sure it is suitable with your objectives, risk tolerance, risk profile liquidity considerations, tax situation, and anything else pertinent to your financial situation. Also, the CFA credential in no way implies investment returns will be superior for any charterholder.
Yale Bock, CFA
President, Y H & C Investments
