Could This Be the Future of the Restaurant Business
By JLP | January 26, 2012
I read this in a Thomas Friedman piece I read this morning. I know I complain about the quality of service I receive at most places, but I’m not sure I’m ready to here…
Last April, Annie Lowrey of Slate wrote about a start-up called “E la Carte” that is out to shrink the need for waiters and waitresses: The company “has produced a kind of souped-up iPad that lets you order and pay right at your table. The brainchild of a bunch of M.I.T. engineers, the nifty invention, known as the Presto, might be found at a restaurant near you soon. … You select what you want to eat and add items to a cart. Depending on the restaurant’s preferences, the console could show you nutritional information, ingredients lists and photographs. You can make special requests, like ‘dressing on the side’ or ‘quintuple bacon.’ When you’re done, the order zings over to the kitchen, and the Presto tells you how long it will take for your items to come out. … Bored with your companions? Play games on the machine. When you’re through with your meal, you pay on the console, splitting the bill item by item if you wish and paying however you want. And you can have your receipt e-mailed to you. … Each console goes for $100 per month. If a restaurant serves meals eight hours a day, seven days a week, it works out to 42 cents per hour per table — making the Presto cheaper than even the very cheapest waiter.”
Thoughts?
Topics: Economics | 9 Comments »
Interesting Breakdown of Warren Buffett’s Secretary’s Tax and Salary
By JLP | January 26, 2012
Saw this on Forbes:
Warren Buffett’s Secretary Likely Makes Between $200,000 And $500,000/Year
Not sure how accurate the author’s numbers are. I’m fairly certain that those who are using tax rates for effect, are probably including payroll taxes. If that’s the case, his numbers are off.
One thing I find amusing about Buffett and his tax situation is that he’s the boss and he COULD pay himself a much larger salary and pay the income taxes on it accordingly. He doesn’t do that, though. Oh, and if he really did desire to pay more taxes, he could always write the IRS a check. My respect for Warren has soured over the last few years.
Topics: Taxes, Warren Buffett | 35 Comments »
Interesting Tidbits from the 2012 Barron’s Roundtable (Part 1)
By JLP | January 26, 2012
Note: This post has been sitting in my drafts for over a week. I’m a little behind on my reading but I’ll try to follow-up with any interesting findings from Part 2 of the roundtable.
I don’t read the annual Barron’s Roundtable for stock tips. Rather, I read it to get a sense of the bigger picture. Here are a few quotes from Part I of this year’s Roundtable.
Bill Gross: When money yields nothing, banks won’t lend it. If a bank can keep money on deposit with the Fed at 25 basis points [a quarter of a percentage point] or lend it at 27 basis points, the yield on a two-year Treasury, why take the two-year risk? The combination of low return and high risk basically freezes the system. The global system is trying to delever and central banks are trying stop that process and pump trillions of dollars in. In a bimodal world, we could have reflation in 2013-14, or deflation in 2012. The probability of both is high.
Then there is this exchange comparing today’s situation to the late-seventies early eighties:
Schafer: Most of us have been in the business long enough to remember when the Aug. 13, 1979, cover of BusinessWeek declared the death of equities. The next year the market was up 13%. In the next five years it was up more than 50%. In the next 10 years it rose more than 250%. There is a lot of pessimism around, and a lot of opportunity.
Witmer: It is astounding that people will trample each other to get a cheap TV, but when shares of great companies get cheap, they sell them. It makes no sense.
Zulauf: People don’t care if the TV gets cheaper later, but they care when their stocks get cheaper.
Black: The U.S. doesn’t have the same financial flexibility today that it had in 1979 and 1980. Government debt is 100% of GDP, compared with 32.6% then. The huge debt overhang is a ticking time bomb.
Gross: The biggest difference is that long-term Treasuries were yielding 14.5% in 1981, and now they yield 3%. The federal funds rate was approaching 20% then, and it is basically zero now. To do well, stocks and other asset classes have to fight a tremendous head wind of overvaluation in the price of money.
That’s all that stood out from Part 1.
Topics: Investing | 1 Comment »
Question of the Day – Parenting
By JLP | January 25, 2012
My oldest son is 16 and is about to inherit our old car as soon as we get his mom something else to drive. Since he will have transportation, we have decided to let him get an after school job to help pay for his insurance, save for another vehicle, as well as get some experience. I know several people from my grocery store days back when I was in college. So, here is my question…
Is it a bad (or good) idea for me to help him get a job by making a couple of phone calls?
I’m leaning towards helping him. Why? Because he’s a good kid and I know he’ll do a good job when given a chance. Also, from a store manager’s point of view, it might be nice to hire the kid of someone you know well because you know that the parent is going to hold their kid to a higher standard.
I’d like to know your thoughts.
Topics: Kids and Money | 13 Comments »
This Stuff STILL Angers Me…
By JLP | January 24, 2012
Begin rant.
Just saw this on MSN:
Deal could cut principal on 1 million loans
Apparantly, there’s ANOTHER deal being hammered out to help homeowers (misspelled on purpose). Here’s how this deal might work out:
• $17 billion would go toward principal reductions. If 1 million homeowners were to be helped, that would equal an average reduction of $20,000 each. About 11 million U.S. homeowners are underwater on their mortgages.
• $5 billion would go toward homeowners affected by the deceptive practices and to state and federal housing programs. The settlement envisions a payment of $1,800 each to 750,000 affected homeowners. About 8 million Americans have faced foreclosure in the past four years.
• $3 billion would help homeowners refinance their mortgage loans at a rate of 5.25%. That’s more than 1 percentage point above current market rates, but most underwater homeowners are not eligible for refinancing. Some, however, have received rates as low as 2% as part of mortgage modification deals.
The media is doing a tremendous job at painting these homeowners as victims.
Question: Where’s my mortgage principal writedown?
Basically, this “deal” screws all the people who were RESPONSIBLE and bought homes they could afford.
Yes, some banks foreclosed improperly. It’s not known if the homeowners being foreclosed upon deserved it or not. I guess if a bank tries to foreclose without the proper paperwork, the deliquent borrower can just stay there forever. Not sure how that works.
It’s a big mess.
End rant.
Topics: Housing Market | 13 Comments »
More on the Romney Income Tax Debate
By JLP | January 24, 2012
I read a couple of follow-up stories/opinion pieces on Mitt Romney’s tax bill.
The first one, Romney and the Burden of Double Taxation, echoes the point I made last week about dividends being taxed at the corporate level before they paid to investors.
He goes on…
This is ironically the embodiment of the “corporate personhood” legal doctrine otherwise so decried by the left. The law taxes corporations as if they were separate beings from the shareholders who own them and then levies a separate tax on shareholder payouts and gains. This double taxation brings the effective tax rate on investment income to as much as 44.75%.
Now, this point is ONLY relevant if the corporation is actually paying federal income tax.
The other article (also in today’s paper) gives a little more depth to Romney’s taxes:
Mr. Romney reported $21.7 million in income. He paid $3 million in federal taxes, slightly more than the $2.98 million he made in charitable donations.
Of Mr. Romney’s 2010 income, he noted a capital gain of $12.6 million, taxable interest of $3.3 million, ordinary dividends of $4.9 million and smaller sums of gains and losses on business income, refunds and other income.
In an estimate of his 2011 taxes, the Romney campaign said Mr. Romney would pay $3.23 million in federal tax on $20.9 million in total income. He said he would have itemized deductions of $5.7 million, including $4 million in charitable donations.
Personally, I think all politicians should receive this kind of scrutiny.
Topics: Politics, Taxes | 27 Comments »
Quote of the Day – Hedge Funds
By JLP | January 24, 2012
This quote comes from a book titled The Hedge Fund Mirage: The Illusion of Big Money and Why It’s Too Good to Be True
“If all the money that’s ever been invested in hedge funds had been put in Treasury bills instead, the results would have been twice as good.”
I have often suspected the same thing. I think hedge funds are really only good for the hedge fund managers. If a hedge fund manager is making outsized returns, he’s probably taking lots of risk.
*Affiliate Link
Topics: Books | 2 Comments »