why cash is king, page-14

Well, I'm very surprised by the quick pace turnaround in market conditions, just as I was with the sharp decline. Looks like the americans are a very optimistic lot ready to seize any good news and milk it for more than what its worth. Surprisingly the politicians actually came through in message. It could be trader greed fueling the comeback, but they don't care.

The good news is the economic stimulus package will kick in in May, which is sooner than I thought. The bad news is, it will kick in in MAY!! thats 3-4 months away and people will start spending it after then which might affect 2Q results or 3Q. On the other hand some if not most will use it to pay debt such as credit cards and a minority will do the right thing and save. I have considered that it might perpetually kick in sooner as some taxpayers might consider it booked income and increase their debt spending. When will these type learn.

I had doubted the message that most individuals will get $700, so I did some calculations. If there are 250mil people of which say roughtly 70 are taxpayers, then that amounts to 175mil. Of this 30% would be too rich to qualify. so that leaves 122. so their share would be $1200 approx. Sounds about right then! Its been a long time since I've had to worry about money, but will 1200 bucks make me empowered to spend and lift the economy? Feedback people!!!

Now, where is congress going to get the money from? I don't know. Maybe print some more cash? Borrow? In any event, inflation will go up which I think is being contained at the moment by the property bubble burst.. Lucky them!

Had a pile of cash that only got minimal use a few days ago, however, no regrets as my cash is safe and I did pick up a few bargains (including BNB) ready to take advantage of any more weakness that is to come.

I think through it all, and given that BNB is a young company, ownership of this company has lost its sheen for me. I will not sell my holdings but I think I will not increase it either. What BNB do can easily be replicated by other competitors. Sure, they invest in growth companies, but do so with debt which I think the investment community needs to monitor more closely, but will fail to do so.