When does No mean No?
Research for Online Investors

by John Dalt

2/7/11

When does “No” mean maybe?  Evidently, when you are dealing with Amtrak and U.S. Senators.  Gov. Chris Christie cancelled the $20 billion dollar tunnel connecting New Jersey with New York last year.  This only encouraged the U.S. largest passenger rail service to enlist U.S. Senators to endorse a plan to spend another $50 million on preliminary engineering and design of a new tunnel.

The press release from Reuters tells us the funding for construction would come from local, regional and state governments in New York and New Jersey along with private investors.  What don’t these guys understand?  Gov. Christie said “No.”  So now they are going to spend another $50 million dollars on another study and design.  Maybe they think there will be a new governor someday.

In the meantime, Amtrak loses money every day because they cannot operate the lines they have profitably.  Maybe they should worry about making money at the business they are in before they try get any bigger.  According to American Public Radio, Amtrak lost money on 41 of the 44 routes they served.  Their losses averaged $32 per ticket sold for a total subsidy of $1.3 billion dollars in 2008.

One of Amtrak’s trains derailed today in New York’s East tunnel.  According to CBS New York sixteen trains will have to be cancelled on the Long Island Rail Road (LIRR).

President Obama appeared before the Chamber of Commerce this morning.  He held out the promise of lower taxes for business, but in return wants business to hire employees.  His pitch was that business had “a responsibility” to give back to America. The President tried to channel JFK with, “As we work with you to make America a better place to do business, ask yourselves what you can do for America. Ask yourselves what you can do to hire American workers, to support the American economy, and to invest in this nation.”

The administration wants to make “investments” in America’s future.  Research into cutting edge technologies, grants to energy efficient sector companies are some of the planned “investments.”  It all smacks of picking the winners and losers.  It tells us the government can decide which is better Blue-Ray or DVD’s, Sony Betamax or VHS, New Coke or Classic; these are a few of the competitions that the free market has decided.  All without government interference.

We know the White House monitored the mid-term elections.  We know Obama is smart.  We know he wants to triangulate and isolate his critics, so he can continue with his plans.  Doesn't he understand what NO means?

Subscriber M.T. sent in the following quote:

Economies grow only and always in surprising ways.  This growth results from millions of creative minds ceaselessly cooperating with, and competing against, each other.  The results are inherently unforeseeable and always in progress… We can make the future foreseeable only by making it dreary. ---Professor of Economics Donald J. Boudreaux

To the mailbag:
Please cancel my subscription to the long-term portfolio even though I have made 28% on XOM, 10% on NE, 4% on AGNC (plus dividends), and 13% on CSCO, 1.4% on NLY and 2.4% on OVTI. I am tired of reading how bad obama is.

John’s reply:  Foolish me, I thought our job was to tell the truth and recommend stocks that make money.  Your check is in the mail.  He won’t be any less a socialist when you don’t read about it, but perhaps you will sleep better.  Ignorance is bliss.

The information presented in this newsletter is based on generally available news releases, corporate filings, current events, interviews and the editor’s opinions.  It may contain errors and you should not make investment decisions based solely on what you believe you have read here.  Do your own research, it is your money.  If you lose it, it is your responsibility, not ours or your grandmothers!  The editor may or may not have a position in any securities discussed.  The editor may have held a position in a security earlier, or in the future.

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