"there are all kinds of wonderful new inventions that give you
nothing as owners except the opportunity to spend a lot more money
in a business that's still going to be lousy. The money still
won't come to you. All of the advantages from great improvements
are going to flow through to the customers."  - Charlie Munger


Stingy Links
http://www.stingyinvestor.com/SI/articles/articlearchive.shtml

Selling the family jewels
http://www.slate.com/id/2195866/
"Selling heirloom assets is frequently a last-ditch alternative.
In instances in which assets have appreciated massively (such as
SunTrust's Coca-Cola stock or Merrill's stake in Bloomberg),
the sales can generate hefty tax bills. Such moves are also
recognitions that management has screwed things up so royally in the
core business that it has no alternative but to sell the
remaining assets that the market still likes. But in this climate, many
banks may find they don't have a choice."

Sell-side analysts more accurate than buy-side
http://www.advisor.ca/news/article.jsp?content=20080722_150607_9224
"Investors rarely have access to the buy-side analyst reports of
institutional investors, and according to a new study by a trio
of Harvard Business School researchers, they likely aren't
missing much. The study finds buy-side analysts are more optimistic
and less accurate than their sell-side counterparts, who freely
distribute their recommendations."

Bear market opportunities
http://www.forbes.com/personalfinance/forbes/2008/0811/106.html
"Should you flee the market, given all this? It's a tough call,
but I wouldn't. For one thing, the Administration and Congress
can play a much larger role in alleviating the liquidity crisis
than they have up to now. This being an election year, I have a
strong feeling we'll see considerably more help from them in the
next few months. Most likely the Fed will eventually move to
fight inflation. Raising rates usually hurts the markets at first,
but over time stocks have been one of the best inflation hedges
you can find. In these circumstances, I wouldn't try to be too
clever. You don't see market timers who own yachts. If you pack up
now, chances are you'll miss a good part of the next bull
market. A large part of the gains are always made in the first few
months of one, when market-timing investors are still on the
sidelines."

How to leave your wife
http://articles.moneycentral.msn.com/CollegeAndFamily/SuddenlySingle/HowToLeaveYourWife.aspx?page=all
"If your marriage is crumbling, you need to pay attention to
money matters -- or suffer harsh consequences. Here's what to do,
men." [A link to a similar article for women is provided near the
top of this article. But thrifty couples will work hard to avoid
divorce.]

Can a family eat on $100 a week?
http://articles.moneycentral.msn.com/CollegeAndFamily/RaiseKids/CanAFamilyEatOn100AWeek.aspx?page=all
"Did we make it? First, let's say that any reduction in my
grocery bill was welcome, as most weeks we spend nearly $250 at a
grocery store. That's well above the $182 budget the U.S. government
considers "moderate" for a family of our size and ages.
Spending less than half what we normally do was tough. A $100 budget
gave us $1.19 a meal per person, obviously not enough for dinners
or coffees out and barely enough to put decent meat on our
plates."

The Big Mac index
http://www.economist.com/daily/chartgallery/displaystory.cfm?story_id=11784836
"Many of the currencies in the Fed's major-currency index,
including the euro, the British pound, Swiss franc and Canadian
dollar, are overvalued and trading higher than last year's burger
benchmark. Only the Japanese yen could be considered a snip. The
dollar still buys a lot of burger in the rest of Asia too. China's
currency is among the most undervalued, but a little bit less so
than a year ago."

Lawyer finds gaping hole in securities law
https://secure.globeadvisor.com/servlet/ArticleNews/story/gam/20080723/LAWCOLUMN23
""Allowing a member to resign and therefore escape sanction for
improper acts committed while a member of a [self-regulatory
organization] can hardly be said to protect investors. ...
Certainly, the public would have less confidence in capital markets where
sanctions for misconduct could be avoided by a simple letter of
resignation," Judge Carnwath wrote."

SEC plans to broaden curbs on short sales
http://www.cnbc.com/id/25829544
"The top U.S. securities regulator remains steadfast in a plan to
broaden an emergency rule to curb abusive short selling despite
opposition from the hedge fund industry and other short
sellers. U.S. Securities and Exchange Commission Chairman Christopher
Cox told lawmakers Thursday the agency would soon propose
expanding the rule covering the shares of 19 major financial firms to
the entire market."

Shortsighted naked-short solution
http://www.forbes.com/home/2008/07/24/sec-shorting-regulation-biz-cz_rl_0726croesus.html
"The latest Wall Street cesspool is the short-selling arena,
where greedy hedge funds, beleaguered investment and commercial
banks and an incompetent regulator--the Securities and Exchange
Commission--have made bollocks out of a crucial arena of the
markets."

Selling your cottage needn't be so taxing
https://secure.globeadvisor.com/servlet/ArticleNews/story/gam/20080717/RCESTNICK17
"Let's assume that James now owns the cottage. He could shelter
the cottage from tax by designating it as his PR for the years
prior to 1982. For years after 1981, only one exemption is
available and the couple would designate the cottage for those years.
The result is twofold: There is no tax to pay on the sale of the
cottage this year since it has been designated as a PR for every
year it was owned. Further, Kate has not yet designated a
property as her PR for the years prior to 1982. She could designate
the Oakville home for those years. The result? We've now
sheltered part of the eventual gain on the Oakville home as well."

Dividends more reliable than share price rises
http://professionaladviser.co.uk/showPage.html?page=padv_display_news&tempPageId=805779
"Growth in dividend payments is far more reliable than rises in
share prices, according to analysis by Fidelity International.
The research found that dividend payments from the UK market have
shown an annual increase in all but five years since the
beginning of 1965."

Fill up on pre-poll bargains
http://www.ft.com/cms/s/0/4535dc44-58c3-11dd-a093-000077b07658.html
"A point few fully recognise - one I've never seen mentioned
anywhere - is the robust historical anomaly of US stocks
outperforming non-US stocks in the few months just before presidential
elections. Regardless of which election you start with, or whether
stocks rise or fall through the period, or whether US stocks
start off leading or lagging, US stocks overwhelmingly outperform
non-US stocks in the election run-up from June through October. In
non-election years the reverse has been slightly true. So
overall, in all years, there is no such nation effect - only when it
comes to presidential elections."

The smartest advice I ever got
http://money.cnn.com/galleries/2008/pf/0807/gallery.smartest_advice.moneymag/index.html
"I was nine years old, and I saw my father reading the financial
pages. They didn't look like the sports pages or the comics, so
I asked him what they were. He said, "Well, these are stocks." I
said, "What's a stock?" And he said, "See this thing? This
represents a company. And see this 'plus .25'? That means that if
you own one share of this company today, you have 25 more than you
had yesterday." And I said, "I can have this thing yesterday, I
can go to sleep, wake up and have 25 more and not do any work?"
And he said, "Yes." I had come in from mowing the grass for
three hours to earn 25. So the lesson I took was that in the stock
market you can make money without doing any work. And since I
have always had an almost infinite capacity for indolence, I
thought, "This is great.""

Wall Street's laughing all the way to the bank
https://secure.globeadvisor.com/servlet/ArticleNews/story/gam/20080723/RVOXX23
"The credit crisis really puts the free in free market. The
freest market is supposed to be the United States, and the evidence
in favour of that argument is mounting. It's just not what you
think. Free, in this case, means a free ride for a select group of
people. Wall Street never looked so good, or bad, depending on
your perspective."

Bad news sparks a stampede
http://www.miamiherald.com/135/story/612916.html
"After IndyMac Bancorp failed, customers waited in line for hours
to collect their money. The police had to be called in to quell
the crowd. The scenes brought to mind dire moments from the
Great Depression. On the Federal Deposit Insurance Corp. Web site,
IndyMac customers were told: ''If the balance in your account .
. . is less than $100,000, no action is required on your part at
this time.'' The money is insured. Many behavioral economists
watching people herd in line at the bank -- or flush their
portfolios of Fannie Mae and Freddie Mac stock -- sense a deep even
primal, response at play. I suppose the only way to say this is to
just say it: People are acting like frogs. When a group of
frogs senses they are about to be visited by the dreaded snake, they
do not hop in separate directions. They bunch up together. And
they fight to get in the middle. Sheep do it. Minnows do it. It
turns out that humans do, too, particularly in financial
crashes."

Are we a nation of financial illiterates?
http://freakonomics.blogs.nytimes.com/2008/07/21/are-we-a-nation-of-financial-illiterates/
"How important is widespread financial literacy to the health of
a modern society? Well, I would say very. So would Lusardi. When
you have a society with a modern and fairly complex financial
system, it's probably not a good sign that more than half of the
citizenry can't handle even the basics"

The marks of a great value investor
http://www.ft.com/cms/s/0/5bf3d98e-5785-11dd-916c-000077b07658.html?nclick_check=1
"John Templeton's market aphorisms was that "the time to buy is
at the point of maximum pessimism", although I believe he has a
good claim also to be the true originator of the saying that the
four most dangerous words in investment are "this time it's
different". Does he think that we have reached such a point in the
credit crisis? Alas, we shall never hear his views again,
following his death two weeks ago at the grand age of 95."

Are P-E's past their prime?
http://www.businessweek.com/investor/content/jul2008/pi20080718_837276.htm
"The price-earnings ratio is a popular tool for investors. But
these days, as both prices and earnings fluctuate rapidly, the p-e
tool is getting extra attention because it tries to answer a
key question: With the broad Standard & Poor's 500-stock index
down almost 20% from its October peak, are stocks cheap enough to
make them a great bargain for long-term investors?"

Why no outrage?
http://online.wsj.com/public/article/SB121642367125066615-4K_l2jdjmxrSAZRs5Ii1mziroY8_20080818.html?mod=tff_main_tff_top
"Through history, outrageous financial behavior has been met with
outrage. But today Wall Street's damaging recklessness has been
met with near-silence, from a too-tolerant populace, argues
James Grant"

How to control your fears
http://biz.yahoo.com/wallstreet/080719/sb121642720591866951_id.html?.v=8
"What goes on inside your head when your portfolio implodes? One
of the fear centers in your brain, the amygdala, can respond to
upsetting stimuli in 12 milliseconds, or one-25th the time it
takes to blink your eye. These brain cells fire when an attack dog
snarls at you, a spider drops down your shirt or the Dow Jones
Industrial Average takes a dive."


S&P/TSX60 Value Screens
http://www.stingyinvestor.com/SI/strategy.shtml 

High Dividend Yield Stocks                 P/E P/B P/S P/C P/D Yield*
========================================== === === === === === ======
Biovail (BVF)                               4   5   3   5   5    5
CIBC (CM)                                   0   4   5   5   5    5
Bank of Montreal (BMO)                      3   4   5   1   5    5
National Bank of Canada (NA)                3   4   4   4   5    5
Husky Energy (HSE)                          4   2   3   3   5    5
Telus (T)                                   5   4   4   5   5    5
Royal Bank (RY)                             4   3   4   5   5    5
Bank of Nova Scotia (BNS)                   3   2   3   1   5    5
Toronto Dominion Bank (TD)                  4   4   3   3   5    5
BCE (BCE)                                   5   3   3   4   4    4
More Info: http://www.stingyinvestor.com/SI/strategy/dogs.shtml 

Value Ratio Stocks                         P/E P/B P/S P/C P/D  VR
========================================== === === === === === =====
Biovail (BVF)                               4   5   3   5   5   0.8
Thomson (TOC)                               5   4   2   2   4   1.9
Telus (T)                                   5   4   4   5   5   1.9
Bank of Montreal (BMO)                      3   4   5   1   5   2.0
Husky Energy (HSE)                          4   2   3   3   5   2.2
BCE (BCE)                                   5   3   3   4   4   2.2
Royal Bank (RY)                             4   3   4   5   5   2.6
Toronto Dominion Bank (TD)                  4   4   3   3   5   2.8
Sun Life (SLF)                              4   5   4   1   4   3.2
Bank of Nova Scotia (BNS)                   3   2   3   1   5   3.2
More Info: http://www.stingyinvestor.com/SI/strategy/valueratio.shtml 

Graham Stocks                              P/E P/B P/D   G$   dG$(%)
========================================== === === === ====== ======
ACE Aviation (ACE.B)                        5   5   0   84.91 708.63
Magna Cl.A (MG.A)                           5   5   3  100.07  72.42
Thomson (TOC)                               5   4   4   55.77  48.79
Nova (NCX)                                  5   4   2   36.01  36.93
Petro Canada (PCA)                          5   4   3   60.54  28.20
Biovail (BVF)                               4   5   5   14.13  25.46
Canadian Tire (CTC.A)                       4   5   3   67.00  24.33
Inmet Mining (IMN)                          5   4   1   75.53  19.89
Weston George (WN)                          4   5   4   52.95  18.59
Telus (T)                                   5   4   5   44.43  16.32
Sun Life (SLF)                              4   5   4   49.85  15.93
MDS Inc. (MDS)                              2   5   0   15.96   9.63
Bank of Montreal (BMO)                      3   4   5   49.89   4.59
BCE (BCE)                                   5   3   4   40.05   2.96
Canadian Pacific Rail (CP)                  4   4   3   64.95   2.79
Talisman Energy (TLM)                       5   3   2   18.10   0.09
More Info: http://www.stingyinvestor.com/SI/strategy/graham.shtml 

*Notes: http://www.stingyinvestor.com/SI/strategy/notes.shtml 

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Books for Stingy Investors

Common Stocks and Uncommon Profits
by Philip A. Fisher

Fisher takes a qualitative view of stocks and stresses the
importance of intangible aspects of a firm with heavy emphasis on
research and human capital. He also falls into the focused camp of
investors who buy only a few carefully selected stocks and hold
them for long periods. As Warren Buffett's second favourite book
on investing, Common Stocks and Uncommon Profits is a must read
for students of the market.
Amazon Link: http://www.amazon.ca/exec/obidos/ASIN/0471445509/


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The Rothery Report
http://www.rotheryreport.com/ 

The Rothery Report provides research on select deep-value stocks in
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  Average Capital Gain    Average Holding Period
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http://www.rotheryreport.com/store/store.shtml

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http://www.rotheryreport.com/store/order.shtml 



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ISSN 1499-2795 Copyright Dan Hallett and Associates Inc., 2008.
All rights reserved. The securities mentioned in this report are not
appropriate for all investors. Consult your professional investment
advisor before making any investment decision.  While all reasonable
effort is made to ensure the accuracy of information and data
contained herein, accuracy can not be guaranteed. Past performance is
not a good predictor of future performance.  Results are not
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information in this newsletter, and in its related website, is not
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