This is the Motor City

Motown, Hockeytown, Rock City and now Broke Town.

Yeah, we're talking about Detroit.

The city has seen far better times. The once great auto manufacturer has seemingly fallen into a economic disparity according to the eyes of the world. However, despite an unsolved murder rate of 70%, a thriving illegal drug industry, and having the most expensive auto insurance in America for having a high crime rate, Detroit is showing signs of recovery.

Detroit is one of the few cities in the US to have all the big four accounting firms present, as well as corporate offices for Ally Financial, Bank of America , JP Morgan, Robert Half and Raymond James. In 2011, Quicken Loans moved their headquarters to downtown Detroit after a very profitable 2009. This moved 4000 employees downtown. Blue Cross consolidated 6000 employees to downtown Detroit in 2011 as well. Besides finance, Detroit became the fastest region in the US for high tech jobs (2010). Incubators for high tech such as the Michigan Security Network nurture research in cybersecurity, biodefense, and border security.

Manufacturing is still a large part of Detroit, with GM, Ford and Chrysler all retaining corporate offices along with any major automaker. General Electric has built a 100m center employing 1200 people averaging 100k a year. Adding to this is a large refinery operated by Marathon, which refines oil sands from Canada. Speaking of Canada, the Windsor-Detroit border crossing provides $13 billion in economic activity (roughly).

The list goes on, I am just summarizing Wikipedia. I knew most of this, but some of it surprised me as it should others. However, everyone heard of the large bailouts for automakers in 2010 . The population of Detroit fell 25% from 2000 - 2010. The 2009 Detroit unemployment rate was 30% compared t America's 9.1% unemployment. (some said the real unemployment rate was 50%). Adding to this is the gangs and ghettos that cause the police to even fret. Myself being a Caucasian individual could possibly wind up on that list of unsolved murders if I dared to venture out past the cultural divide on the 8 mile. It could be said that 2008/2009 were two of the worst years Detroit has seen as the financial world crumbled around them weakening automakers even further.

However, there are signs of hope. The tech industry in Detroit is slowly showing life. Expertise in Cloud Computing, Mobile Software apps, and Energy Management  are in demand as automakers switch to higher tech cars. Technology is especially needed with the US Government granting a billion dollars for further research and development into lithium powered motors. In 2010, tech employment has risen 10%. The main draw is not the salary, which is still below the US National Average, but the low cost of living which could be an estimated 90% below that of living in the Silicon Valley.  The unemployment rate is still higher than the national average, but sits at around 13%, far better than that of 2 years ago. Many of these new jobs are in the Tech industry as hydrogen fuel cells and green automobile energies are being researched.

In terms of political economic assistance and development, Detroit is showing some progress. Some parts of Detroit are designated as Michigan Renaissance Zones - which are almost tax free areas for any business or resident in the area. Tax abatements, public loans and grants, and community development block grants are all programs Detroit has offered. Job training continues under a famous program entitled HOPE, while the Michigan Economic Development Corp. has created a job training program meant to meet market needs.

Lastly, Detroit has seen employers people to live there including Detroit Medical Center, Henry Ford Hospital, Quicken, Compuware, Wayne State and others.  The Blue Cross is offering a 5 year Live Downtown program, which home buyers can receive a $20 000 forgivable loan and renters a $2500 allowance. Current residents could be given up to $5000 for exterior improvements.

I'm not saying Detroit is a paradise, far from that. Stories such as this still exist and are a reality for many. All I am saying is Detroit does finally seem to be sowing seeds of opportunity, something that hasn't been seen for a while. It has bottomed out, and with proper economic and political policy, will continue a slow ascension back to paradise. Ok, not paradise, but maybe meeting the national unemployment rate is a good goal.  

In terms of investment, I can suggest the following. First, if you want to begin a startup tech business and cannot afford the high costs of the Silicon Valley, try Detroit. If you wish to live for free in a more dangerous area as a young college graduate, try Detroit.  If you wish to work for some of the cutting edge auto technology that is playing a part in green technology, try Detroit. Lastly, if you want to see the Toronto Maple Leafs utterly destroy the Detroit Red Wings in 2012, try Detroit.

http://www.youtube.com/watch?v=SKL254Y_jtc

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Quick Stock Analysis - RIM

Research in Motion has had a wild ride.

From introducing a smartphone so popular it was nicknamed the "Crackberry" to being taken over by the iPhone in market share and seeing their founders Mike Lazaridis and Jim Balsillie being forced out of their own company.

What went wrong? No, RIM's products are not inferior. In fact, their platform has been recognized by the US government and a few others for its communication security. Adding to this is their easy to use patented keyboard which I personally find preferable over the touch screen keyboards, popular BBM messenger (which has been replicated - iMessage, KiK etc..) and strong battery life.

However, the reason the product has seen a collapse in American market share is the marketing campaign by Apple, and the openness of Google in the promotion of Android. The iPhone is neither a revolutionary product nor an amazing platform. It's appearance is - simply because the UI is so easy to use that my 8 year old brother is a magician on the iPad. When Steve Job's was leading the development of the iPod, he said it was essential that user's only had to click three buttons to play music. Anything more than that was simply too much. This principle has carried forward with Apple to this day, as their platform is an amazing user experience with easy to use features that often blow non technical minds away. It's the reason why the Mac and iPhone are the tools of choice for Starbuck's guppies and hipsters across the nation each feeling that their Mac makes them part of an elite crowd. The black silhouette dancing with the white signature iPod headphones was not only an amazing marketing campaign, but also a symbol that began the creation of the Apple cult.

 Samsung perfectly captured this in their video with the comment " 'I could never get a Samsung - I'm creative' - 'Dude, you're a Barista' ".  Frankly, iPhones are not an engineering marvel, but more of a design marvel that exemplifies the power of marketing and a clean user interphase to generate sales. However, if this video portrays the new iPhone 5 correctly, I will be first in line to get one.

Apple and Android both did something that RIM did not. They included developers. It is a widely known fact that Google and Apple both have far more applications ready for download than Blackberry. The reason is because both companies realized it was essential to keep developers in the loop to maintain innovation and also popularity. It's like Angry Birds - most likely would have never been dreamt up by Apple app creators, but created by Rovio Mobile. This one game has led to the attraction of the iPhone/iPod/iPad - and it occurred because Apple and Android both realized the necessity of involving outside talent in their product lines. Google has also done this with Android creating a community of developers. RIM, on the other hand, just recently has tried to appeal to developers - but like it is very difficult to steal a girl from a boyfriend who took her to Paris for her birthday - it's very difficult to bring a devoted developer over to another platform.

The last problem with RIM is it's organizational culture, which is an add on of their problem courting developers. Expressed by a RIM executive in an open letter calling for culture change, the corporate culture of suits, ties and bureaucracy is simply not a culture that creates successful Technology companies. RIM has need a culture change for a while now, a change that is attractive to the programming talent available.

So can RIM turn it around?

Financially they are not at rock bottom, book value for the company is around 14.5 a share, so they are definitely a buy around there. Internationally, the Blackberry is arguably one of the most popular phones in the world outside of North America. Also, their secure platform makes them popular for corporations and governments. The only place where they have been hit is by the North American consumer, which is a rather large hit as their decline suggests. Frankly, I think their new CEO will be able to to turn the company around and I am very happy with this statement he made:

"When Blackberry got positioned the way you experienced it, it was on a set of values: battery life, network efficiency, security and best typing experience," Mr. Heins said. "In the U.S. specifically, what we missed is a shift in those paradigms" to more consumer orientated features like Web-browsing and apps, Mr. Heins said. 

Thorsten Heins comes from Siemens, a very technology successful company and I believe he has the vision to turn RIM and the Blackberry brand around. The stock price looks very attractive right now with an EPS of around 4.2, so I recommend this stock as a buy. Try to pick it up around 16, but don't be greedy. Already expectations are low by analysts, if RIM even moderately succeeds the stock price could shoot up dramatically.

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Let's Talk Texting

"Your a grammar nazi" 

"*You're"

This is a typical text that can be received from myself. I attribute my grammar obsession to AP English in High School, and a good friend of mine who corrected me quite a few times. At first, I was annoyed. It was just a text, or msn/facebook conversation - why does it matter? 

It does matter. 

First, using the wrong then (or than) or any other errors makes one look rather silly, especially if the character in question is a University educated person with English listed as their first language. Silly may be the wrong word to use - stupid may be better. I admit, I automatically judge those who repeatedly suffer from an inability to use correct spelling and grammar in their communications. As a person who eventually could be in a position to hire, if I am in contact with a person who applies for a job that I have influence over selection - I will automatically question this person's literacy. Why? It's simple, constantly misspelling words offers ill examples of one's writing abilities. 

The second point I will argue is often debated. Usually the Mischievous Misspeller (yes I realized this is not a word) will protest. Admitting to being guilty of using gross grammatical goggles to casually communicate, the deviant will often protest that they can remove these goggles and write normally at will. True, some people can do this. It is often the case though, they cannot. Personally, I have witnessed too many University students submitting their papers with ridiculous errors to be able to accept this explanation. 

However, don't take my word for it. I'll just quote an article:

“Thirty per cent of students who are admitted are not able to pass at a minimum level,” says Ann Barrett, managing director of the English language proficiency exam at Waterloo University. “We would certainly like it to be a lot lower.”

Barrett says the failure rate has jumped five percentage points in the past few years, up to 30 per cent from 25 per cent.

“What has happened in high school that they cannot pass our simple test of written English, at a minimum?” she asks.

Even those with good marks out of Grade 12, so-called elite students, “still can't pass our simple test,” she says.

Poor grammar is the major reason students fail, says Barrett.

“If a student has problems with articles, prepositions, verb tenses, that's a problem.”

The link to the article is at the bottom. 

Adding to this, Paul Budra (an English Professor at Simon Fraser) questions if University students have any idea what an apostrophe is used for. I have experienced a similar phenomenon. Most people I know cannot differentiate between "its (possession)" and "it's" (contraction for it is/has). Experts in the field express disdain at the effect of social networking and texting upon correct grammar and spelling. Joel Postman has taught Fortune 500 companies on how to use social networking, agrees with this statement as do many others. 

However, the problems caused by increased digital communications are not just a manifesting themselves in the writing world. Many people are so used to digital communication, they have forgotten how to communicate face to face. Basic social skills that can be learned, practiced and acquired in a bar scene such as networking, striking up a sudden conversation, or approaching a group of people are now skills that many people will pay for training. Oral communication is essential for any job, or any relationship. 

How to fix this? Well, when someone corrects you on their grammar, don't reply back with a "LOL ummm okkk grammar nasi" (yes I misspelled "nazi" to make a point). Instead, take that correction into consideration and try to be a better communicator. There simply is no excuse. You will appear to be more intelligent, and no one has ever complained about a person using correct spelling. 

Next, if you have problems with speaking or oral communication, join Toastmasters. It's an international public speaking organization that can greatly assist anyone in improving one's speaking skills. Also, go out to social venues more often and do not just sit a chair texting your best friend. Talk to a few people who you never met before, and see what happens. 

Improving your social skills is a function of enhancing your appearance and communication. Improving your communiqués and speaking skills assists in accomplishing both. 

Article: http://www.theglobeandmail.com/news/technology/texting-twitter-contributing-to-students-poor-grammar-skills-profs-say/article1452300/

Obligatory Oatmeal Poster: http://theoatmeal.com/comics/misspelling 

Affect vs. Effect: http://grammar.quickanddirtytips.com/affect-versus-effect.aspx

Better Article on the Subject: http://ezinearticles.com/?Influence-of-Texting-on-Communication-Skills&id=6031841

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The Congruency of Democracy and Idiocy

Today, British Columbia (a province of Canada) and the Canadian federal government agreed on a plan to repay around $1.6 billion dollars to the federal government from the province. The reasoning behind this entire issue borders on the insane. Basically, the Federal government decided to promote the amalgamation of taxation, or the creation of a new tax entitled the HST, or Harmonized Sales Tax. Simply, the tax combines the Federal GST and Provincial PST together into one tax. Basically, it creates a more efficient taxation system but also does increase taxes by a minor amount per family - around $400 or so per family.

British Columbia instituted the HST, collected the money from the Federal government, and also made concessions to the citizens of BC in order to appease them. Namely, reversing the 7% portion of the HST on gas/diesel sales (Ontario this did not happen).

Then political populism came into play.

Politicians spreading propaganda about the new tax to simply place the current government on the defensive attacked the HST. This manifested itself into a referendum, which reversed the HST. So, after all the bureaucratic work that went into the creation of the tax, it was reversed and BC will now lose almost $2 billion because of the idiocy of the people.

It is questionable if the majority of people who voted on the HST even knew both sides of the issue and had the mind to make a independent and informed vote. Actually, it's not questionable, it's probable due to the results.

This example is one of many around the world that can show the problems of democracy today. Politicians using populist anthems to attract votes is becoming quite annoying. A majority of people do not understand the complex financial system that allow the creation of pensions, a social security net or even post secondary education funding programs. It is easy to vote in favour of these programs, it is very hard to reverse or remove these programs - which most politicians will not touch.

The world needs to find politicians who have the courage to stand for realistic solutions to problems, instead of temporary solutions that buy votes. 

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Quick Stock Analysis - Canadian Buys

Well, we're entering an important part of the year. No, not Thanksgiving or Christmas (some of us don't need a reason to drink), but tax season. Yup, 'tis the season to selloff any stocks that aren't doing so well in order to claim a loss and deduct it against your income as a capital loss. No one wants the capital gains loss. After all, its temporary - you  buy it again in January.

With the late tax selloffs beginning to come around soon, stocks have a reason to generally go down. That's adding to the European debt crisis, the American debt crisis, individual State debt crisis', provincial debt crisis', and obviously Obama. Why Obama? Because he is a Muslim. It's true, I got a email that was forwarded 50 times that had its subject in capital letters and looked like it came from a perfectly legitimate source. I mean after all, an organization entitled "The Tea Party" must be full of logical, reasonable people 

yes?

Anyways, sarcasm aside, we still have to look at Canadian stocks and potential buying opportunities. Right now, shorting almost any stock temporarily will result in a slight profit. With the Americans about to go round two on debating whether to lift their debt ceiling and the Europeans in complete political disarray resulting in economical catastrophe, the simple conclusion is confidence will keep falling resulting in declining stock prices.

However, there are some stocks I would especially look at for buying. In the following days I will post the stocks on the TSX I would short (plenty of those). Disclosure, I am personally not invested in anything right now, and this is the opinion of a person who still holds a grudge against his 8th grade teacher - so take it with some salt.

Uranium One (UUU): Uranium prices no doubt have taken a hit since the Japanese disaster. UUU was no different, and has plummeted from around $6 a share to almost $2 a share. I have written about Uranium before, and will admit being wrong in the past. I cannot believe that the nuclear energy has been hit so hard from the Japan crisis. Nuclear energy is still the world's best energy source in terms of cost, efficiency, and pollution - and the negative PR against it is simply that - negative PR.  To view more information on the industry as a whole, check my post back in June. Specifically, UUU is below book value. Liquid assets have doubled from 2009 to 2010, but have fallen from a high in September of 2010. This may be explained by an increase in A/R's, along with increases in inventory and increased investments in property and plant.  UUU is 6th in the world in terms of uranium, and is planning large expansion. Very well diversified with mines in Kazakhstan, Australia, Wyoming - UUU is heading to produce around 10.5 million pounds of uranium at a cost of $18 a pound, and once their new field in the Mkuju River. The deal there is a bit more complicated, but Uranium will be produced at $22 a pound. If this all occurs, UUU will be ahead of Cameco producing 26 million pounds of Uranium per year. Right now, spot price of Uranium is around $55 a pound, falling from around $70. With winter approaching Japan - the 43 offline reactors will begin to startup to address the energy shortage. Also, India and China's nuclear expansion is expected to continue. UUU will be there to provide the fuel.

Target: $4.00

Recommendation: Long term hold, 2 years

Bottomed? No, nothing has bottomed yet. Buy below $2

I will post more stocks as time progresses from the TSX that I feel are buys. 

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Dear Leader? Try Delirious Leader.

I haven't posted in a while due to life getting a bit busy. However, I wish to say a few things concerning the major world problems. Greece should not default, the chain reaction would be cataclysmic. Italy is actually not that bad despite facing unsustainable 7% bond yields, while Spain is actually in worse shape. New alliances by the Americans and Canadians in Asia are good for diversification of their export/import portfolio. China's internal banking crisis will come to light in 2012, as my world predictions for 2012 will come out soon enough.

Enough of that, I decided to post a letter from Kim Il Sung (he's dead - probably had a ghost writer - pun intended) , written for the Economist in the World in 2012 edition. If you have a chance, pick up the magazine, it's a great read. This letter describes the insanity that this nation is governed by, and truly shows how scary it would be should this nation acquire a nuclear bomb.

One hundred years after my birth, I, Kim Il Sung, founding deity of North Korea, will descend from heaven. 


That is only one prediction that can be made with cast - iron certainty about what I proudly proclaim is the world's most unpredictable country. On the 100th anniversary of my birth, April 15th 2012, the whole world will hear nothing but lies about the peace-loving people of North Korea. 


Your organs of capitalist propaganda will mock the goosesteps, the Nazi - like choreography, and the sickly flowers., Kimilsungia, named in my honour. They will never mention what a pure-hearted people my beloved children are. As their hollow bellies attest, they have fasted in mourning almost incessantly since my passing away in 1994 - with hardly a whisper of complaint. They bend their broken backs out of love for my dear son, Kim Jon Il, so that he no longer needs to wear platform shoes to see over their heads. They rejoice as he erects monument after monument to my memory, instead of wasting it on the fripperies of food. On my 70th birthday they built an Arch of Triumph, bigger than the French one, with a brick for everyday day of my life. In 2012 they will finish the 100 foot Ryugyong Hotel in Pyongyang in honour of me. Who cares if none of them can afford to stay there: empty, it will make a lovely missile sole to impress the neighbours. 


Next year will be , as my dear son has promised, the year when North Korea becomes a strong and prosperous nation. Strong, of course, we already are. We have outlived Soviet Russia, Mao Zedong in China, and deadly departed comrades such as Nicolae Ceausecu of Romania. Superpowers continue to bow to our whims, promising aid and investment even when we threaten to nuke our beloved South Korean brethren to hell and back. Prosperity may take a little longer, it is not for nothing that people, looking at our tragically torn peninsula, talk about "One country, two planets". But if our army is strong enough to have a million guns, who needs butter? 


The only thing that troubles me, as I gaze down from my mushroom cloud on Mount Paektu, is ensuring my legacy lives on. Not everyone can come up with an ideology based on self - delusion, Chisten it with Juche, and tell people that it's about self-reliance - self-reliance, that is,  on all those capitalist dogs we hoodwink for aid. Not everyone would could fashion a brand of ethno fascist, neo -Stalinist, theocratic, murderous totalitarianism and yet portry himself as a father molly - coddling his devoted children. 


My son, sadly, has not managed to step into my shoes. He prefers spending time with ostriches, his fashion sense is other-worldly, and with his taste for lobster and red wine it is no wonder gout is killing him. So, in good theocratic tradition, 2012 calls for some divine intervention. I will therefore descend from heaven, and be reborn in the shape of my pudgy grandson - Kim Jong Un. 


You don't believe me? It is not for nothing that your newspaper has already christened him the Chosun Un. 




Satire at it`s finest.

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