Monthly Archives: February 2016

The Activist Investor: A True Ally of Corporate Governance

Activist investors: Publicly listed companies fear them. Corporate governance pundits generally do not trust them. Retail investors quietly applaud them, and most laymen do not understand them. However, it is clear that in today’s complex corporate world, we need them. Activist investors may be the only players in the game that can effectively “Occupy Wall Street”.

 
We have entered the twilight zone when it comes to corporate governance. The zone where many Boards bury their head in the sand when it comes to breaches in compliance, as in the case of HSBC and the tax evasion scandal of February 2015. Certain Boards passively bow to the dictates of executive management, throwing all accountability on the corporation-as-entity, with no individual responsibility. All other stakeholders, from shareholders, to suppliers, to workers, to humble taxpayers are left to peck at what is left of net worth after the share price dives, and are left to fork out money for regulation and reconstruction.

 
To be fair, in the recent past activist investors have been noted for short-termism. Short-termism is the process by which an activist fund may coerce target companies to conduct strategies that may yield high profit in the short term, but that may be detrimental to company performance in the long term. For instance, it is common practice for activist funds to demand significant reduction in Research & Development activities; yet, R&D is needed for long term competitive and innovative advancement.

 

For More: http://financialpolicycouncil.org/blog/the-activist-investor-a-true-ally-of-corporate-governance

Thank you,

THE WORLD IN A (CRACKED) NUTSHELL: THINGS HAPPEN

Investors and people in the business world need to be aware of world events and the impact they have on their business outcomes. Recent events of which we should all be aware are:

 
• The Russian-Turkish Rivalry
• The Apparent Steadying of the European Economy
• The Death of Supreme Court Justice Antonin Scalia
• Prison Riot in Mexico City
• The Northwards Spread of the Vika Virus
• Trade Dispute between Russia and Ukraine
• Rapid Changes in the Syrian Civil War
• Economic, Security and Political Developments in Central Africa
• Growing Civilian Casualties in Afghanistan
• The Weakening of the Indian Rupee
• Growing Stresses between North and South Korea
• Poor Performance of Japan’s Economy
• The Persistent Decline of Oil and Gas Prices
• American Political Chaos

 

For More: http://financialpolicycouncil.org/blog/the-world-in-a-cracked-nutshell-things-happen

Pissing Away Money Down the R&D Rat Hole

Let me start by saying that I am a physicist and have been involved with many of the leading U.S. research facilities over the years — Los Alamos National Laboratory, Sandia Laboratories, just to name two.  I also directed the Socrates Project under the Reagan administration.  So the quick knee-jerk reaction to the title that “I don’t understand research and development or the value of technology” holds no water at all.  Please don’t even try to argue this point.

 
Research and development (R&D) does not equate to a competitive advantage in the marketplace or on the military battlefield.  Knowledge for knowledge’s sake is a worthwhile pursuit.  Totally agree.  But it is conceptually flawed and detrimental to the objective — being competitive — when companies and governments use the need to increase economic and military might as justification for higher expenditures on R&D.  But yet this is the rapidly rising battle cry among the leading thinkers in Congress, the Pentagon, academia, think tanks, and the press — “Raise R&D funding levels, and America’s future will be secured.”  How so far from the truth.

 
One highly critical set of decision makers who suffers from this R&D is the key to competitiveness thinking is the leadership in the office of the Secretary of Defense.  But this was all avoidable.

 

ForMore: http://financialpolicycouncil.org/blog/when-will-we-stop-blindly-pissing-money-down-the-rd-rat-hole

Thank you,

When Will We Stop Blindly Pissing Away Money Down the R&D Rat Hole?

When Will We Stop Blindly Pissing Away Money Down the R&D Rat Hole?
By Michael C. Sekora – Past Director of the Socrates Project, President of Quadrigy, Inc. affiliated with Operation U.S. Forward

 

 

Let me start by saying that I am a physicist and have been involved with many of the leading U.S. research facilities over the years — Los Alamos National Laboratory, Sandia Laboratories, just to name two.  I also directed the Socrates Project under the Reagan administration.  So the quick knee-jerk reaction to the title that “I don’t understand research and development or the value of technology” holds no water at all.  Please don’t even try to argue this point.

 
Research and development (R&D) does not equate to a competitive advantage in the marketplace or on the military battlefield.  Knowledge for knowledge’s sake is a worthwhile pursuit.  Totally agree.  But it is conceptually flawed and detrimental to the objective — being competitive — when companies and governments use the need to increase economic and military might as justification for higher expenditures on R&D.  But yet this is the rapidly rising battle cry among the leading thinkers in Congress, the Pentagon, academia, think tanks, and the press — “Raise R&D funding levels, and America’s future will be secured.”  How so far from the truth.

 

 

ForMore:http://financialpolicycouncil.org/blog/when-will-we-stop-blindly-pissing-money-down-the-rd-rat-hole

Thank you,

Investors Can Boost Their Cybersecurity

Security Essential for Financial Transactions Online

Now that the Cyberworld is upon us, most of us do most, if not all, of our financial transactions online. Long gone is the day when most of us paid our bills by check or delivered a check to our brokers to invest for us. Now we pay our bills online, either on the biller’s Website, or on our bank’s Website. We don’t write checks – we transfer funds. We rely on the security of the Web site with which we are dealing to protect the security of the transaction. Most of us make sure that the “HTTPS” designation is at the beginning of the address for every Website on which we conduct transactions or share sensitive information. We maintain security and privacy settings on Facebook, LinkedIn, Twitter, and other social Websites where we publish. We have firewalls for our computer systems, our personal computers, and our home networks. We have anti-virus software and run it rigorously. We have our Outlook set for appropriate levels of security and use spam settings to segregate anything that looks like spam, knowing that in the spam box we can see the REAL addresses behind the links in emails.

 

We know enough not to click on any link in any email, instead copying and pasting the address into our browsers. We have our browsers set for appropriate levels of security and privacy, and use a secure browser like Firefox or Tor. We have our networks set for security against invaders. We understand that the weakest link is usually the employee sitting at his keyboard, and have established suitable policies, procedures and penalties regarding cybersecurity for our employees. We use, and require our employees to use, “strong passwords” and change them often.

 

For More: http://financialpolicycouncil.org/blog/investors-can-boost-their-cybersecurity-back-to-the-basics

Thank You,

Key Financial Regulations To Monitor

Fourth quarter 2015 was a hard precursor to 2016 both in capital markets and financial corporate governance. Highly volatile commodities and equities markets, an overall slowing of economic growth and a cooling of tech business growth have left the investing landscape bearish. In addition, corporate governance of major financial and business institutions showed signs of increased shakiness; in 2015 HSBC took the governance world by storm with tax evasions, Bank of America and Citi continued to fail bank stress tests and capital requirements and JPMorgan’s stock has significantly underperformed analysts’ expectations.

 

We now open the year 2016 with an SEC fraud charge against the entire executive management and Board of Superior Bank for overstating loan performance. In this light, 2016 will be a year of continued US Federal Reserve and Securities and Exchange Commission (SEC) financial regulation.

For More: http://financialpolicycouncil.org/blog/key-financial-regulations-to-monitor

Thank you,

Doomsayers Be Right and Can They Make Us Any Money? – Ziad K Abdelnour

When Will the Doomsayers Be Right and Can They Make Us Any Money? – Mark Skousen and Ziad K Abdelnour, Financial Policy Council Event, Monday, 16 November 2015, 6:00 – 9:00 PM.
Location: The Graduate Center / CUNY at 365 Fifth Avenue at The Elebash Recital Hall – On the main floor of the building and on the left as you enter into the main lobby.
Moderator:
Mark Skousen, Ph. D., Editor of Forecasts & Strategies, is a nationally known investment expert, economist, university professor, and author of more than 25 books.

The Panelists:

Ziad K Abdelnour is a Wall Street Financier, Author, Philanthropist, Activist, Lobbyist, Oil & Gas Trader & President & CEO of Blackhawk Partners, Inc.

Vince D’Addona is a senior executive with Strategies for Wealth – a wealth planning and management firm – with 36 years of experience providing financial planning.

Michael Grad has been employed by AIG, Inc. from 2009 through this month. He joined AIG in early 2009 as Senior Managing Director in the Restructuring Group.

 

Thank You.