• “REACTING TO IMPULSES INEVITABLY LEADS TO WRONG INVESTMENT DECISIONS… Since we are genetically programmed to crowd when we feel comfortable and flee when we sense danger, people want to invest in equities near the top and sell into every panic… But over 90% of returns are determined by asset classes, so allocation is the largest determinant of effective design… Personal objective should be simply focus on goals and adherence to core principals…without regard to volatility…rather than attempting to exploit market timing and/or individual stock picking. (The Wall Street Journal Dartboard portfolio routinely beats the stock-pickers and indexes typically outperform 80% of active managers over a decade.)” DCG have decades of expertise in optimal asset allocation, developing appropriate risk:reward parameters, and guiding clients to effective investment advisors. [RVW INVESTING BULLETIN – July 13]
  • THE HOSPITAL INDUSTRY IS NOW PAYING THE PRICE FOR ITS DEAL-WITH-THE-DEVIL. In return for accepting a $155 billion decrease in Medicare payments over a decade (worsened by another 2% this year from Sequestration), “hospital executives were assured by the Obama administration that patients newly covered under the health-care law would make up for much of the loss… That hasn’t happened.” Political squabbles and the fact that nearly half the states have ‘opted out’ of Medicaid coverage for the poor have left the institutions with deep deficits – resulting in shut downs of emergency rooms, urgent care clinics, maternity wards, dialysis centers, transportation services for poor & elderly patients and the like, across the country. Cleveland Clinic, a $6 billion budget health center, is “searching for ways” to cut $250 million from its budget; Liberty Hospital, a major Midwest medical center, has eliminated 120 jobs so far this year. ‘Self-inflicted wound’ or not, hospitals are in trouble. [BLOOMBERG BUSINESSWEEK – July 18, 13]
  • “THE IVORY TOWERS OF ACADEMIA HAVE BEEN SHAKEN TO THEIR FOUNDATIONS, as University brands built in some cases over centuries have been forced to contemplate the possibility that information technology will rapidly make their existing business model obsolete.” ‘Massive Open Online Courses’ (MOOCs) are now being offered by top-tier universities and colleges around the world (like Harvard & M.I.T.) with content often developed by independent companies, including Silicon Valley startups, and often delivered free of cost. While ‘degree program’ dropout rates are high (“in some cases exceeding 90%”), courses are becoming more popular, especially in light of constant tuition increases simply untenable for most. For those who can afford it, usually employer-paid fringes, Executive MBA ‘Joint Programs’ between cooperating schools also let participants “flit between campuses in different countries” along with online course completion. Northwestern University has programs with institutions in Canada, Germany and Hong Kong; UCLA with Singapore; Georgetown University with Spain. “Dotcom mania was slow in coming to higher education, but now it has the venerable industry firmly in its grip.” [THE ECONOMIST – July 20, 13]
  • REMINDER ABOUT ‘HOBBY’ DEDUCTIONS: Whether I.R.S. will allow ‘business’ deduction for losses from any activity which could be construed as a ‘hobby’ is based on nine mostly subjective factors. In DCG experience, the most impor- tant involve: (1) Businesslike conduct including maintenance of records and bank accounts; (2) Substantive time, effort and expertise in the activity; (3) History of income/loss amounts and relativity to investment & value of assets utilized; (4) Whether the activity provides “recreation” or involves “personal motives.” Irrespective of these criteria, the code provides that if gross income exceeds attributable deductions in three of the preceding five years, the activity is “generally presumed to be for-profit,” a result which can often be effected with advance planning. [THE TAX ADVISOR – July 1, 13]
  • “A RISING NUMBER OF RADICALIZED YOUNG MUSLIMS WITH WESTERN PASSPORTS are travelling to Syria to fight with the rebels… raising fears among American and European intelligence officials of a new terrorist threat when they return home… with a burst of jihadist zeal, some semblance of military discipline, enhanced weapons & explosives skills, and (worst case) orders from affiliates of Al Qaeda to carry out terrorist strikes.” [LEVINE BREAKING NEWS – July 28, 13]
  • THOUGHT FOR THE WEEK: 10 quick time-saving tips for using your computer, cell phone or camera – a five-minute presentation:http://www.ted.com/talks/david_pogue_10_top_time_saving_tech_tips.html? utm_source=newsletter_daily&utm_campaign=daily&utm_medium=email&utm_content=button__2013-04-26