Thursday, January 29, 2009

Monday, January 19, 2009

One of my Hobby Interests

This CNN Piece covers the remarkable story of Porsche's thriving business in this economic turmoil. I know it's not at all Pittsburgh related, but I thought some of you that read my blog for some of the economic discussion might find it interesting.

Wednesday, January 14, 2009

Investing Pittsburgh: Ouch, was that the sky falling? Part II

I missed the whole, bottom falling out of the metals market prediction. Though I think a recovery will be in order before too long. In fact I'm inches from buying more US Steel.

The good news is, I did foresee the falling of the market as a whole and we had a VERY small portfolio so all this bad news hasn't hit us too hard. Tomorrow we may have to buy some of our positions back. I'll keep you posted.

By the way, I'm looking in to other stocks we might purchase since I'm kind of bored with the same 6 stocks.

Investing Pittsburgh is a regular part of this blog. It details the ins and outs of a mock portfolio of Pittsburgh Stocks invested and managed by me. For a list of all of the previous "Investing Pittsburgh" posts, click here.

Tuesday, January 13, 2009

Now That's a Newspaper

Well there's some interesting stuff going on in the Burgh:
  • Patrick Dowd may run for mayor. I bet there are a bunch of people wishing they had more firmly backed Barack Obama right now. A little endorsement or even the right to say "I was for change nationally, and I'm for change locally" would go a long way right now.
  • Mayor Ravenstahl and Dan Onorato Embrace Limits on Campaign Financing. I was as shocked as you guys, they both have more then a little lead in HUGE campaign donations. I am anxious to see what Bram and others who follow these things closer have to say about this. It sounds like a good law to me, limiting campaign contributions to roughly federal levels and prohibiting encumbants from using funds leftover from before the law. The individual limits seem high at $4,600, but it's still a great step I think.
  • Fiscal Responsibility in Mt. Lebanon. AWESOME. I thought for sure they were going to end up with a school they didn't need at a price the community could not afford. FYI, my mother is a Mt. Lebanon tax payer and home owner.
  • Onorato to Host Cyber Town Hall. Got to give the guy props for trying to bring the oldest county outside of Florida in to the 21st century. Though things like this are kind of unfair, since it uses county resources and doesn't offer a rebuttal.

Monday, January 12, 2009

It's Amazing What a Good Running Game Can Do

Pittsburgh in the NYT

I'm certainly not the first to cover Pittsburgh's big break in the Economy section of the NYT (in fact I might be the last). That's ok though, because my reflection is going to be a little bit different. I thought the piece was great publicity for Pittsburgh, but only fluff as far as an "economics" piece goes. Maybe I've just spent too much time researching the Burgh, but summarizing the Pittsburgh Renaissance as a, "development plan begun in the 1980s [that] successfully used the local universities to pour state funds into technology research" seems a little short of reality, there was a lot more to it. Then sumarizing its results as "Entrepreneurship bloomed in computer software and biotechnology" is definitely a bit much. I seem to recall some recent criticism of the entrepreneurship scene and has anyone else noticed that Pittsburgh's own Meakem Becker doesn't have a single Pittsburgh company in its portfolio? A more realistic picture of the economic resurgance likely is that we bottomed out a couple years back and now have nowhere to go but up. That doesn't paint the picture of a quaint midwestern town (which, don't kid yourself, is how New Yorkers see us) that sells newspapers.

What's more interesting has been the fallout. Several interesting little tidbits have fallen out of the NYT's recent interest in Pittsburgh.
  • First, is the Freakenomics blog post by Stephen Dubner himself (who claims to be a Steeler fan!) about the unusual fact that the Steeler's aren't mentioned in the article. Dubner points out that writing an article about Pittsburgh without mentioning the Steelers is tricky, especially given that the 15 highest rated shows in the Pittsburgh area, have all been Steeler games.
  • Second, is another NYT article about the most creative leader in all of Pittsburgh. No, not Luke Ravenstahl. No, not Dan Onorato. No, not even Mike Tomlin. Dick LeBeau. The article is really a charming piece about one of the more interesting Burghers. Its well researched, with a lot of insight from previous teamates and colleagues. While there is some "aren't Pittsburghers such a cute midwestern novelty" attitude, it's more forgivable then the aforementioned "economics" article.
  • Third, is a Pop City article about the author of the LeBeau piece. While it is not a NYT piece, it is nice to know that Pittsburghers (who live in the city of Pittsburgh) are getting published in the New York Times. Even nicer to know that they're brining their NY salaries to Pittsburgh to spend. Check out the building that she is working on, absolutely amazing.

Friday, January 9, 2009

Kraut so Sour it Stings

No hot dog or kielbasa nonsense, straight to the bullets... mmmmm:
  • It appears Penn State might have a basketball team after all. Interesting, I'll keep you posted as news develops.
  • Kevin McClatchy's ownership stake in the Pirates = 0%, it's about time! Now we'll need 10 years of "rebuilding" before I can stop wearing this shirt.
  • Fast Food pulls a Fast One - McDonald's is replacing the Double Cheeseburger with the McDouble on the dollar menu. The difference? One slice of cheese instead of two. The double cheeseburger is still available, for $1.19.

Note: you can't get sour kraut at McDonald's.

Pittsburgh Entrepreneurs

THE most important thing for mobilizing the Pittsburgh base and improving our beloved Burgh, is a solid base of entrepreneurs. After a good idea, the first thing an entrepreneur needs is venture capital, that's why I'm so happy that Pittsburgh has Meakem Becker. Furthermore, it's why I'm happy to pass on this bit of news about one of Meakem Becker's investments, Webcarzz (summary from Alan Veeck himself).

Steeler Nation: Future Burghers?

Jim Russell, a self-proclaimed (but easily backed-up) Pittsburgh Diaspora Evangelist, is a guy and a blogger that I haven't talked enough about recently. Jim is a prolific blogger, and you may not find something interesting in every post he makes, but there are some REALLY good things in there. While most of us spend a lot of time thinking about how we can attract people physically to the Burgh, attract businesses to the burgh and improve Pittsburgh for the Burghers here (through better laws and such). Essentially, our fundamental question is "How do we get people to move to Pittsburgh?" Jim thinks outside the box, to me asking a more fundamental question, "How do we get people who love Pittsburgh to help Pittsburgh?" He throws out the assumption that to be a "Pittsburgher" you have to live in Pittsburgh. As he puts it, his primary goal is, "Turn[ing] the problem of mobile human capital in to an asset."

Jim had a post a couple days ago that could have served as an answer to my blog post that challenged Burghers to use the Internet to do more for Pittsburgh then just providing information. He left me a challenge to find people who have migrated home to Pittsburgh and "get some success stories on the web." If any of you are one of those people, please let me know and I will be happy to post your story here. If you know anyone who has returned home to the Burgh, tell them to drop me an email: I know a couple and I will work to get their stories out here, but would love to have some more.

Wednesday, January 7, 2009

Investing Pittsburgh: My 5 Favorite Stocks

A friend of mine asked me to put together a list of my five favorite stocks. I thought since I put in the work, that I'd go ahead and share it not just with him, but with my e-friends as well!

In general I follow three rules (in order of importance) for stock picking.
  1. Must be a good value
  2. Must pay a dividend with a decent yield. I have found that if you can find a value stock with a decent dividend that there’s no hurry for the stock price to recover because you can cash dividend checks while you wait for the market to correct.
  3. Preferably a contrarian play. With the rise of the online discount broker, there are more silly plays being made in the market than ever before. I’m happy to take advantage of them. I also think that many new age stocks are overhyped. Though I make my living in technology, I can sympathize with Buffet’s argument about the over-valuation of the tech sector as a whole.
With that in mind here are 5 picks I like and any reasons I have for them outside of what’s mentioned above:
  1. PNC – It’s my favorite right now, and the heftiest percentage of my portfolio. In addition to being a good value (with quite a bit of growth potential to boot), I bought in with a 6% yield! You can still get pretty close to that, around 5.5 at the moment. People are apprehensive about the merger with National City, but the government gave NCC to PNC for a wink and a smile and they didn’t do it so PNC would fail.
  2. X – US Steel is by far my second favorite. Since I bought it in early December I’m up close to 40% and I still think it’s a bargain, a steal if you’ll forgive the pun. In addition to being a solid match for my three factors, it has the potential to benefit fantastically from any major infrastructure project Obama embarks on.
  3. HNZ – There’s a big drop off for me between second place and third. In fact at the moment my portfolio is 70% cash with the rest in PNC and X. That being said, we had to pick 5 companies and I don’t think HNZ is a bad place to be. 4.5% yield from a solid value stock.
  4. PPG – See the note about Heinz, I’m not sure the money isn’t better off in cash for the next month or two, but I think it is a good buy at this price and would help any portfolio in the long run. Its yield is almost 5% and its business is pretty diverse. People have overestimated its dependency on the Big 3. Many of the vehicle related products that PPG produces will be used by foreign vehicle companies with plants in the US and Mexico even if the Big 3 were to be allowed to fail (which I doubt).
  5. AEO – Don’t buy this yet unless you don’t mind holding it for a while, but it is still a good deal at a 7.8 P/E. The yield is below 4, which isn’t particularly good for the current deflated share price, but I think it has more growth potential then most of the other stocks I’ve named.
Investing Pittsburgh is a regular part of this blog. It details the ins and outs of a mock portfolio of Pittsburgh Stocks invested and managed by me. For a list of all of the previous "Investing Pittsburgh" posts, click here.

Investing Pittsburgh: Being Smart is the Only Way to Make Money Investing

The best way to be smart? Get educated.

Chris Briem has posted a link to the Economics Club Forecast Luncheon. Unfortunately, I will be out of town and unable to attend. However, anyone who reads this blog, especially if its for the business angle should DEFINITELY try to attend. The chief economists from both PNC and Mellon will be speaking.

If anyone does attend and wants to write up a little summary of their thoughts, I'd be happy to post it here. I'll also be looking for write-ups in the MSM and other blogs.

Investing Pittsburgh is a regular part of this blog. It details the ins and outs of a mock portfolio of Pittsburgh Stocks invested and managed by me. For a list of all of the previous "Investing Pittsburgh" posts, click here.

Investing Pittsburgh: Ouch, was that the sky falling?

Early weather reports this morning call for falling prices with a hint of panic. I could say I told you so, but instead I'll offer the following morning numbers to help you choke down your lunch:
  • US Steel down 4%
  • Alcoa down 8%
  • PPG down 2.5%
Fortunately, if you've been following along our portfolio is down to only two stocks for the short term:
  • PNC which is UP 1.4%
  • Heinz which is down less then a percent.
Looks like we may have gotten it right. Though I guess we'll see. I'm not sure how much farther PPG and US Steel have to fall before they become a steal (pun intended).

Investing Pittsburgh is a regular part of this blog. It details the ins and outs of a mock portfolio of Pittsburgh Stocks invested and managed by me. For a list of all of the previous "Investing Pittsburgh" posts, click here.

Carbolic Smoke Ball Hits Another One Out of the Park

Copied from CSB, if you're somehow a regular reader of my blog and NOT reading theirs, wake up. Go over there and read their entire blog, I'll wait.

Obama to Name Fonzarelli Secretary of Cool

fonzieWASHINGTON - President-elect Barack Obama will hold a news conference this morning to announce that he is naming Arthur Fonzarelli as his Secretary of Cool.

Mr. Fonzarelli, or “the Fonz,” as he is known to his colleagues in the greater Milwaukee motorcross/juvenile delinquent communities, is the final appointee to the Obama cabinet.

Attempts to reach Mr. Fonzarelli for comment at his upper-garage apartment or at his office in the men’s room of a popular teenage soda shop were unsuccessful.

It is believed that he spent the weekend at Inspiration Point with the Hooper triplets preparing for his new job.

As head of the Department of Cool, Secretary Fonzarelli will be in charge of implementing President Obama’s oft-stated campaign pledge to restore America’s cool in the world.

According to Obama spokesman Bill Burton, the new Secretary knows just how to get the job done.

“Secretary Fonzarelli has instructed me to release the following statement: ’All nerds in the department are to clean out their desks and be off department property by five o’clock eastern standard time. The purging of nerds will hasten the return of our cool. Aayyyyy.’”

Monday, January 5, 2009

Free Labor , Stipends and the Burghosphere

What did you pay to read my blog today? I have been sitting here in a noodles-to-go for the last hour or so reviewing news stories that might be interesting to my adoring fans, and why? Certainly not for the money. I haven't made a cent from this blog, I probably never will. I blog because I want to make Pittsburgh better, and I think I have a voice worth hearing on the subject. There are a lot of people on the internet who blog or write or draw or program for the pure enjoyment of it. They enjoy being an expert in their field, "mini-Oprahs" as this Business Week article calls them.

The Business Week article explores the start-up ThisNext. ThisNext relies on hundreds of "experts" to search the web, find new trends and post them. ThisNext then sells advertising and makes a small fortune. It'd be a tough sell as a business model because experts are expensive, that is, they are expensive when they don't donate their time. That works out well for ThisNext because they've never paid them a dime. A similar story that I have followed is that of Mahalo. Mahalo pays a whoping $10 per "Search Engine Response" that users generate. It has to take at least 3 or 4 hours to make such a page, and that's if you are skilled at researching and writing. Clearly a bargain for Mahalo.

I believe all of the sites that rely on this "free" help have a few things in common:
  1. An initial hook that gets the site started. For ThisNext, the founders interviewed experts and prepopulated hundreds of pages before day 1. For Mahalo it was a combination of the $10 hook and some prepopulation.
  2. A way to seperate the good from the bad. Some sites rely on a democratic system (Yahoo Answers or Digg for example). Some sites rely on paid reviewers, like Mahalo. Some rely on some combination of the two (wikipedia). However it is done, the review cycle must be quick and complete enough to leave an impression of reliability.
  3. Something New and Interesting. All of these sites enjoy a cult following. This is a bit of a chicken and an egg situation. They are reliable because of their cult following and they have a cult following beacuse they are reliable. Just how to attract this following remains a bit mysterious, but I think the key is a subject matter that is new and mysterious. A new wikipedia won't take off, it's got to be new. It also has to be something that's interesting to everyone in addition to a few core enthusiasts. For example, a site about exotic cars is going to have a larger following then a site about honda accords. Yes, more people own Accords then own exotic cars, but people who don't have a vested interest are more likely to read up on the exotics.
Homework Assignment: Besides a vibrant Burghosphere how can the web be a catalyst to the Pittsburgh community?

Chris Briem Spotted at Pittsblog

Chris Briem snuck over to Pittsblog. That puts two of (if not the) most talented bloggers in the Burghosphere in the same place. Could it be the dream team has a gold medal in mind? I'm staying posted.

If It Looks Like a Duck and Quacks Like a Duck...

...We have to at least consider it is deliberate classism. Yes, I'm talking about the bus thing. For those of you who haven't seen this. Chris Young at City Paper wrote an article about Century III, South Hills Village and Ross Park's reluctance to allow PAT buses to use their roadways. They have claimed that this is because the busways need to be repaired and PAT doesn't want to pay.

My Thoughts:
  • Think about the relative surface area of a busway and a parking lot. You don't hear them complaining about resurfacing the parking lot.
  • Is it even legal to make a shopping mall, allow general traffic, and disallow buses? If it is, it damn well shouldn't be.
  • Would a boycott of Simon Malls (all of the mentioned malls are Simon) be able to get any ground over this? (probably not, but worth asking)
  • What about saying, "the health inspector takes the bus to do food court inspections, no bus stop, no legal food court."

Blogroll Changes

As most of my readers know, I like to keep the blogroll (to your right, if you're on the site) up to date. With this in mind, here are the latest additions and subtractions (update your Readers accordingly):
  • Add Pittsblog (if you deleted it) - That's right Big Mike Maddison is back on the scene, with some aggressive plans.
  • Add Pittsburgh Hoagie - Matt Hogue has redoubled his efforts in the last couple months and seems to be making every effort to fill the gaping hole left by the Burgh Report (read on).
  • Remove The Burgh Report - Widely acknowledged as the best political blog in Pittsburgh, the Burgh Report has joined the growing trash heap of great blogs.

Sunday, January 4, 2009

Investing Pittsburgh: I'll Stay

That's "stay" as opposed to "hit." The market is going to move one way or another this week, and probably pretty big. I'm worried it'll be down. Consequently, I'm selling some of our positions before the week gets going, I want to take some of the profit out. Since I'm running this fund with no commissions or short-term gain taxes, I might as well take some money out. We can always buy back in later in the week. I'm selling all of our PPG at 43.55 and all of our HNZ at 38.93.

Note: If you're following along at home and do have to worry about commissions and taxes, don't worry about staying in PPG and HNZ. They're both solid dividend stocks at a pretty cheap price, they'll be fine in the long run. In fact I'm maintaining both positions in my personal account.

Investing Pittsburgh: Week in Review (Double Wide) 12/22 - 1/2

I have combined the week of Christmas and week of New Years for review. Partly because I didn't have any time last weekend, partly because there have only been 7.5 trading days and partly because these are low volume days that are VERY difficult to read. If you had a strategy you liked that didn't fair well the last two weeks, don't despair they were weird weeks.

Since we didn't make any sales or acquisitions, let's see how the ride we were along for went. Looking at the numbers, here are my observations:
  • My critics will be quick to point out that Alcoa is over 12 and up about 25% in the last two weeks. I will remind them that we sold at 10.7 (far above where Alcoa started its recent run). I will also say, that I've shorted Alcoa at its present price in my personal account, the business is just bound to struggle for a little while and I'm still afraid they'll soon announce they are cutting the dividend.
  • PNC is up almost 10%, I still think its a bargain. I'm looking to expand our position, but I think it will drop off a bit in the short term and give us a chance to get a bargain.
  • We were behind the market overall (DJI was up 5.31%, we were up 3.35%), however the stocks we owned outperformed the market (money invested was up 6.17%). We only trailed the market because of our large cash position, which I still contend you'll thank me for later this month.
That, friends, is your weekly wrap-up. I'm looking for a rocky week this week, so hold on to your seats.

Thursday, January 1, 2009

WE ARE.....

I'll Be Back

Mike Maddison will be making a return to blogging (or at least the burghosphere in one way or another). Following up his shady post on Blog Lebo, Mike made it official that he is up to something on Pittsblog. I've traded a couple emails with Mike and I am quite excited. Nice to be announcing the RETURN of a great blogger instead of another big exit.