In what is known as "synthetic identity fraud," thieves are now creating false identities from whole cloth, and using them to dupe lenders and credit card companies out of their money. The Justice Department says this fast growing danger is one of the hardest forms of identity crime to fight. That's probably because no actual identity is being stolen, so there's no immediate victim to raise a red flag on fraudulent activity. The victims in this case end up being the lenders who cannot get their money back after sending it to a completely fictitious person. Peter Rudegeair and AnnaMaria … [Read more...]
Archives for March 2018
Finally a Long Overdue Volcker Rule Review
The overly complex and opaque Volcker rule is finally getting a review. The Fed and the other agencies tasked with enforcing the Volcker rule are working together on a long overdue examination of the rule's complexity and effectiveness. Lalita Clozel reports at The Wall Street Journal: The Federal Reserve is considering “broad revisions” to how banks comply with a rule that prevents them from engaging in certain types of trading and investing. “I believe the regulation implementing the Volcker rule is an example of a complex regulation that is not working well,” Fed Vice Chairman for … [Read more...]
Can GE Reinvent itself with Battery Storage?
GE is going through a major rebuilding phase. With fraud allegations and mismanagement, the greatest industrial company in American history is in a rut. Could energy storage with batteries save the conglomerate's business? Erin Ailworth explores the idea in The Wall Street Journal: HOUSTON— General Electric Co. GE 1.53% plans to unveil a new battery platform Wednesday as it seeks to become a leader in the emerging market of storing electricity. The giant platform called GE Reservoir will be able to store power generated by wind turbines and solar panels for later use. It will also be able … [Read more...]
Gary Cohn Takes his Tax Break and Leaves
After capturing a capital gains tax break on the Goldman Sachs stock he was "forced" to sell when he joined government, and preventing the Trump administration from cutting the carried interest tax break, and shepherding through a tax break that would definitely help his former employer, Gary Cohn is leaving the White House. There have been many reasons rumored as the cause of Cohn's exit. The official story is that he's against the President's announced tariffs, and so wants nothing more to do with the administration. That may be true to an extent, but it seems like there's more. Some … [Read more...]
A Difficult Phrase to Say: “Enough Already, I’m Retiring”: Part II
I had a great conversation with a client yesterday who told me he has finally decided to retire. He could have retired years ago but continued working because working is what he knew how to do. He said it’s scary thinking about retirement not only from a financial point of view but from a personal point of view it’s just as hard. Retirement and the thought of retirement can be filled with doubt and uncertainty. In other words, answering the question “What am I going to do?” can be a challenge. I have found in speaking with clients who are in or nearing retirement that this is a common … [Read more...]
Are Fewer Commercials the Answer for Broadcast TV?
Fox Network Group’s ad chief wants to reduce TV ad time to two minutes an hour by 2020 from over 13 minutes today. Fox would need to boost price in order to cut volume, but an 85% reduction in commercials would be a hit with consumers. The WSJ has more. The shift is contingent on the industry changing the way it buys and sells media. Mr. Marchese wants to sell ads using a metric based on time spent with content, versus the number of views. “The two minutes per hour is a real target for Fox, and also our challenge for the industry,” said Ed Davis, chief product officer for ad sales … [Read more...]
Forget Music and Video, Now You Can Stream Your Whole Computer
The Wall Street Journal's David Pierce details Blade, a new service run out of France that allows customers with high speed internet connections to virtually use a very powerful computer they don't actually own. For a monthly fee, users are given access to a machine powerful enough to play the latest, graphic intensive games or run processor-heavy programs like graphical editing software. Pierce likens the service to an Uber for computers. He writes: Sometimes a game just clicks for me. Last week, when I bought “Call of Duty: WWII,” the latest in the epic series of shooter games, I found a … [Read more...]
This is Why Dividends are Better than Buybacks
The WSJ reports that U.S. companies have announced $200 billion in share buybacks over the last three months. That’s double the pace of last year. Management teams love buybacks because they boost share prices, which in turn make executive stock options more valuable. The problem with buybacks is that they are discretionary. And corporate boards and management teams have terrible timing. Buybacks tend to be highest late in the business cycle. During recessions, when share prices are at their most attractive levels, buyback activity falls as companies look to conserve cash. Buying back … [Read more...]
This State is Number One
I have a number of clients who live in Iowa and are glad they do, especially when reports like this one from U.S. News and World Report come out. Why would anyone stick around in a high tax blue state if they don't have to? This is not some statistical aberration. Folks want to live where their money is going to be treated with some decency and respect. Jeff Charis-Carlson writes about what makes Iowa so great: Iowa may be better known for its corn, caucuses and creative writing programs, but the Hawkeye state also leads the nation in efforts to bring ultra-fast internet access to every … [Read more...]
An Unintended Consequence of Tax Reform
The tax reform law passed by Congress and signed by President Trump last year included a new rule that allowed businesses to immediately write off 100% of their asset purchases. The bill also allowed this treatment for used equipment that may have already been written off by another company. The WSJ reports that tax planners think companies may begin to shuffle around assets simply to take advantage of the tax treatment. Tax planners say the market for used equipment—including railcars, airplanes and industrial machines—is likely to heat up in the months ahead as firms try to take advantage … [Read more...]
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