Empty Mansions: Don’t be old and rich in New York City

I just finished Empty Mansions: The Mysterious Life of Huguette Clark and the Spending of a Great American Fortune, the New York Times bestseller by investigative reporter Bill Dedman and a relative of the rich old lady who died and left a legal mess.

Huguette Clark was the youngest daughter of a 19th century western mining and banking magnate. She died in 2011 at the age of 104 with a fortune worth more than $ 310 million.

If you were considering becoming old and rich in New York City, this book will serve as a cautionary tale. Clark was reclusive and spent the last two decades of her life in Beth Israel Hospital, which extracted about $ 400,000 per year from her but did not put her in one of their VIP rooms. As Clark was in pretty good health and should not have been there, the hospital hid her from inspectors while simultaneously trying to extract a massive donation from her (over $ 100 million was the goal).

One of her doctors tapped her for more than $ 1 million in loans that he would never repay. Her longtime nurse managed to collect $ 31 million in gifts during Clark’s lifetime and was on track to collect an additional $ 15 million in her Will.

Clark had jewelry in safe deposit boxes at Citibank. The bank lost some of it in the 1980s and took advantage of Clark’s fear of publicity by saying that they couldn’t pay her the fair value discreetly. Then due to incompetence and miscommunication between two departments within Citibank, in the 1990s the bank decided that the rest of her jewelry was abandoned and they sold it “to a liquidator at rock-bottom prices.”

Her accountant had a felony conviction for trying to meet up with 13-year-old and 15-year-old girls in AOL chatrooms (apparently the only people in AOL chatrooms these days are affiliated with the police). The account and lawyer had previously collected for themselves nearly the entire estate (about $ 2 million) of the lawyer’s former partner. Perhaps because it was so easy to get money from estates, these guys barely did their jobs while Clark was alive. Because they didn’t file gift tax returns (despite being paid over $ 200,000 per year in fees), the estate owed the IRS $ 82 million in gift taxes, penalties, and interest.

Apparently in the world of New York State estate law, even the judges need not be above suspicion: “The [dispute over Clark’s will] was assigned in 2013 to a judge, Surrogate Nora S. Anderson, who the previous year had been censured for failing to report $ 250,000 in campaign contributions. She was acquitted by a criminal jury of two felony charges of filing false campaign reports, then was censured by the state judicial conduct commission.”

New York apparently allows a pretty fair amount of stealing from rich dead people without anyone having to break the law. The accountant and lawyer were set up to be executors of Clark’s estate as well as trustees of a foundation to handle some of the charitable bequest. It seems that New York has a standard “executor commission” of about 2 percent on large estates. So even if the bequest had been as simple as “give everything to Princeton” and the work required be nothing more than writing one check, the accountant and lawyer would have paid themselves over $ 6 million. As foundation trustees they then would have been able to pay themselves additional fees for many years to come.

The book is a little sad because Dedman was able to dig up so few honest or selfless New Yorkers. It seems that virtually anyone who got near this woman or earned her trust could not resist the temptation to take advantage of her generosity.

There are some happy parts of the book. Clark uses her fabulous wealth to indulge a taste for the world’s best dollhouses and model Japanese castles, built by craftsmen in Germany and Japan. She pays an assistant to write down transcripts of Flintstone episodes. When she wants to make a little music, she takes a Stradivarius violin out of the closet (first she needs to choose which of her Stradivariuses to play). Back in the middle of the 20th century, Clark bought all of the stuff that rich New Yorkers like and consequently seemingly everything that she bought appreciated beautifully, ranging from her Impressionist paintings to the violins to the big apartment (47X increase in value, adjusted for inflation, from 1955 to 2012).

The book reminds us that even if we aren’t rich enough to own a Renoir or play a Stradivarius, there are some advantages to living in the modern age. Ultimately the saddest part of the book concerns the death of Clark’s beloved older sister at age 17, from an infection that would easily be cured today with antibiotics. Clark’s life might have been very different if her only sibling had survived.

More: buy the book.

Philip Greenspun’s Weblog

Free Options Webinar: Jared Levy: Options Play Strategy Session

Tuesday December 3 2013 at 5pm ET

Each Tuesday, SMB hosts an Options Tribe meeting where veteran traders and experts in the world of options trading share live presentations. This meeting is free to the public on the first Tuesday of each month. All other meetings require an annual membership to OptionsTribe.com. To register or join, please use the invitation link below. SMB’s Options Tribe is an online community of options traders dedicated to sharing successful options trading ideas with all of our members worldwide.

Next week, Jared Levy returns to the Options Tribe for a unique strategy session including participants from SMB’s Equity Trading Desk, to discuss the use of options Read more […]
SMB Capital – Day Trading Blog

Letting Bitcoin Pass Me By

Written By: DragonFly Capital

My life is pretty complicated and full. Between managing money for clients, writing a newsletter and working on the final edits of my book there is about enough time to sit with my family for Thanksgiving Dinner this year. So when people try to start talking to me about the value and potential of Bitcoin ($ BCOIN) my first reaction is to pull my hair out. What the heck is wrong with using a credit card or US Dollar cash anyway? I do not get it and have not even tried to understand it. But as a service to you traders out there Jones-ing for something to trade with the markets closed over Thanksgiving I give you a special treat. I cannot help but notice the discussion of whether or not Bitcoin is in a bubble. And the weekly chart most clearly says maybe but it does not look to be over yet. When viewed through the prism of the Elliott Wave it has come a long way quickly. Hell when viewed anyway it has moved a lot. But the Elliott Wave analysis suggests that it has more room to go. Deep into the technicals the 5 wave structure suggests that it is in wave III of Wave V. What does that mean? That even if it were to reverse today and start the down Wave IV there is still a Wave V of Wave V higher to come. Some

btcusd

math gets you to the possibility of a move down to 675 (38.2% pullback) or so and then a reversal to as high as 1525 (similar move to Wave III higher). Now before you mortgage your house and sell your kids for medical experiments this is not a forecast, but a method of reviewing the current patterns. It may still run another $ 200 before a pullback starts. It may reverse all the way back to 200 before the 5th wave. It may only just reach the high at the end of this Wave III on the final leg. But what else do you have to work with?

Good luck trading this tomorrow as I am dining on Turkey, mashed potatoes, stuffing and pumpkin pie. I can assure you that Bitcoin will not come up in the conversation at our table. Happy Thanksgiving!

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Dragonfly Capital

STTG Market Recap November 26, 2013

A late day selloff knocked the S&P 500 back to near break even but after lagging for a few weeks money has rotated back into tech stocks and small caps.  This is a hallmark sign of a major bull market – constant rotation.  The S&P 500 gained 0.01% and the NASDAQ 0.58%; for those who like round numbers the NASDAQ broke back over 4000 for the first time in 13 years.   A good report on building permits – at a 5 year high – helped lift the housing sector out of recent doldrums.   The Commerce Department said building permits jumped 6.2 percent to a seasonally adjusted annual rate of 1.03 million units. That was the highest rate since June 2008. Economists had expected building permits at a 930,000-unit rate in October.  Permits increased 5.2 percent in September.  August’s permits were revised to a 926,000-unit pace from the previously reported 918,000 units. Permits lead housing starts by at least a month.

No new comments about the indexes – they remain in bullish posture.

spx

nasdaq

We will look at individual stocks today using Marketsmith charts. Housing stocks might be turning a corner here after lagging since May when Bernanke hinted there might be some form of taper later in 2013.  Of course that never came true.

len

ph,

Tiffany’s (TIF) gained after the luxury-jewelry retailer hiked its profit outlook for the year, and posted better-than-expected quarterly income.  Luxury retailers might be in the sweet spot as most stock in the country is concentrated at the upper end and with a 5 year bull market, topped off by this year’s big gains it can only help.   The company reported a 27% sales rise in the Asia-Pacific region, though revenues were down in Japan because of the weak yen. Same-store sales across all regions were up 7%.

tif

Coach (COH) was lifted by Tiffany’s tide.

coh

In tech the old standard leaders looked good today – Apple (AAPL) which has been range bound, might have started a breakout… and Google (GOOG) which had gapped up strongly on earnings a few weeks ago took another leg up.

aapl

goog

Original post: STTG Market Recap November 26, 2013


Stock Trading To Go

Even Xerox (Yes They Are Still Around) Is Breaking Out

Written By: DragonFly Capital

How far are you going to try to deny this is a raging bull market? Not only are the leaders leading. But the large caps are participating. Names you would never think to trade are breaking out. Yes breaking out. Don’t believe me/ Look at Xerox, $ XRX. The chart below shows that this totally unexciting, non cloud, document servicing and outsourcing company is breaking out. After a strong pullback following earnings in October it fully recovered from a 15% price drop, consolidated

xrx

and is breaking out the Tuesday before Thanksgiving. The Measured Move higher takes it to 12-12.25 and the momentum indicators support the continued move up. So if Xerox is a break out stock with an accelerating trend higher and 10% potential move can you finally get on board this bull?

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Dragonfly Capital

Good example of regulatory risk: 23andMe

I just noticed that 23andMe was shut down by the Federales. http://en.wikipedia.org/wiki/23andMe says that over $ 100 million was invested in the company ($ 52.6 million plus an additional $ 50 million in 2012). The New York Times reports that the FDA has made it illegal for them to sell their only product (story). This is a great example of regulatory risk that ordinary investors might not have budgeted for.

Question: would it be illegal for 23andme to relocate to Singapore, for example, and have people mail DNA samples to Singapore and then email them the results? The company’s web site indicates that customers in Singapore (and a bunch of other countries) can send their DNA to have it tested. Would the FDA have jurisdiction to prevent a Singapore-based company from accepting packages from consumers in the U.S.?

Philip Greenspun’s Weblog

Is there an effective way to use Google Contacts with an Android phone?

Having switched from an iPhone 4S to a Samsung Note 3, one of the things that is most confusing is the contacts interface. My iOS contacts were simply set to sync with Google as though Google were a Microsoft Exchange server. The phone knew only about contacts with a phone number. My Android phone, however, similarly set to “show only contacts with phone numbers” responds to a search query with, for example, three separate contacts for my friend Jannis (one is the real contact with a phone number; the other two are orphan contacts that have an email address only). Thrown in for good measure are all of the people that I’ve ever exchanged email with whose name or email address contains a subset of the search query.

This makes it very cumbersome to find contacts with a text search.

How about by browsing the list? That’s cumbersome too because I haven’t found any way in Google Contacts to archive an old contact. I can move stuff into an “Obsolete Contacts” group but I haven’t found a way to tell Android not to sync such contacts.

Back in November 2009 I wrote that “Contacts is the weakest part of Gmail and especially a year ago, could best be considered a work in progress.”

Are there obvious features of either Android or Google Contacts that I am missing?

Philip Greenspun’s Weblog

Join Corey for Two Educational Webinars Thursday

I wanted to invite you to join me at two special educational webinar events today.

First, at 1:00pm EST / 10:00am PST, I’ll be presenting with Andrew Horowitz for the second part of the ongoing “Trader’s Playbook” educational series:

We’ll cover execution tactics, the Accumulation/Distribution Cycle, a “Squeeze Play” Trade Set-up (breakout/impulse), and build on what we discussed in the previous “Price Auction Theory” webinar.

Then after market close at 4:30pm EST/1:30pm PST, I’ll be excited to discuss big topics all in one webinar.

Trading Intraday Breakouts, Retracements, and Reversals” along with discussing one of my favorite topics – “Type of Day Structure.”

According to the description:

“Intraday traders have the advantage of using Day Structure, Market Internals, Volume, and other important indicators for use in confirming a particular set-up.

There’s no need for complexity – and often no time to plan – for intraday traders.

Join Corey Rosenbloom, CMT, for this event introducing quick strategies for the three main types of trade set-ups: Breakouts, Retracements and Reversals.”

We’ll cover a lot of material at both events so bring your notepads, relax, and enjoy.

I’ll be presenting live from my new home in Los Angeles, CA and I hope you can join us!

Corey


Afraid to Trade.com Blog

Market Musings in New York City

Written By: DragonFly Capital

I had the opportunity to sit with Scott Redler at T3 today and we dropped a new mix tape. Well, maybe we just talked about the market. Give a look and listen here if you care.

Capture

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Dragonfly Capital

Wendy’s Earnings Day Thoughts

Written By: DragonFly Capital

Wendy’s, $ WEN, showed up in my weekend work as a stock that could take off to the tune of a 5-10% move in a short period. From the chart below the blue resistance line was being tested again and the Relative Strength Index (RSI) was holding in bullish territory. The MACD was flat but, the whole scenario support a a push higher. The only problem was that it was scheduled to report earnings Thursday morning before the open.

wen

You can see that it did breakout Monday and ran higher on a follow through day Tuesday before capping out at 9.50 on the open Wednesday, up 7.8%, and then reversing lower. I guess it could have been on the watchlist after all. Ahead of earnings with the stock falling the options market saw buyers of Calls and Call Spreads, in November, December and February. This smells of stock replacement, or taking gains in the stock but continuing to express a positive view through options. If this is the case then the sell off Wednesday maybe nothing more than a shift of assets, and a pause in the run up. There is nearly 10% short interest so expect that traders and talking heads will attribute a pop in the stock to a short squeeze, and in a way that may be true. But in any regard you should be ready if it does start higher to jump on board. Does Wendy’s serve breakfast?

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Dragonfly Capital

Should we short Twitter?

Folks: It has come to my attention that Twitter has gone public at a valuation of $ 18 billion. The company has modest revenue (about $ 600 million per year) and no profit. Is it a short?

What is the explanation for how this service can make enough profit ($ 1 billion per year?) to justify an $ 18 billion valuation? It doesn’t seem like a natural advertising medium. Given the possibility of distributing information for free via Facebook or Google+, Twitter does not seem to offer a unique capability to users.

Generally I am a believer in the efficient-market hypothesis but I can’t understand this one.

Philip Greenspun’s Weblog

The Reality of Trading

I thought today was probably my worst trading day of the year. It wasn’t about losing thousands of dollars. It was about my performance relative to the setups I had outlined prior to the market open and the ones identified intra-day. The largest error was in my $ TSLA trading which I will outline below. I was in two other stocks with fresh news and got on the right side of both stocks but did a miserable job of extracting money from them relative to the moves that they had. For professional traders their results are largely determined by how much money they make on the plays that work. We all know how to cut a losing trade and move on to the next but if we fail to capture the upside in the trades Read more […]
SMB Capital – Day Trading Blog

Sell Stocks and Buy Gold? Are You Nuts?

Written By: DragonFly Capital

How many time shave you been told by someone on the television or elsewhere that Stocks are at a peak and that when the great unwind happens from the QE infinity that Gold is the only thing you want to own? Well, hard evidence says that Peter Schiff and others are just dead wrong. The chart below shows the ratio of the S&P 500 ($ SPY, $ SPX) to Gold ($ GC_F, $ GLD) is pressing against what has been resistance since late June. With the momentum indicators (RSI and MACD) both supporting a move higher as shown by the RSI rising and the MACD about to cross up, it suggests this is the

spy gold

time to tell Peter Schiff to go F’ himself, sell your Gold and buy Stocks. Sorry for picking on Peter Schiff if you are one of his customers (please send me something to convince me is not a total retard and I will recant – well maybe) but WTF? Stock are rising. Gold, at best, is not rising, and when you look closely is falling. This chart from a technical perspective suggest that a move to a ratio of 0.1630 could be in store from an ascending triangle break out over 0.1345. That is 21% higher. If Gold just stands still that implies the S&P 500 rises to over 2125. If the S&P stand still it implies that Gold continues to fall to 1080. So what are you doing with your money?

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Dragonfly Capital

Photo Stream on Android? From phone to Picasa?

My Samsung Galaxy Note 3 has such vast powers compared to my iPhone 4S that I can’t figure out how to do anything anymore…

Apple offers Photo Stream (now “iCloud Photos”) where photos taken from one’s phone show up on one’s desktop computer. After that I would copy them into regular folders and pick the ones to publish using Google’s Picasa, then push up to Google+ for sharing with friends and family.

What is the Android equivalent? All of the photos go up to Google+ automatically. But I can’t figure out how to bring them down to Picasa. The automatically uploaded directories don’t appear as folders that I can import from Google+ into Picasa. And there doesn’t seem to be a catch-all “sync everything” feature. What are people supposed to do? Once the photos are in the cloud keep them in the cloud and do all of the editing with a Web browser? The interface is very slow and cumbersome compared to the Picasa desktop app.

One thing that seems to work pretty well is Dropbox. A single setting has everything from the phone go into “Camera Uploads” and I can use that folder the way that I used iCloud Photos (actually it seems to work better; I had trouble attaching or uploading files directly from the iCloud Photos folder, which didn’t work like other Windows directories). Somehow, though, I can’t wrap my head around the idea that I need a third party service (Dropbox) to connect two Google services (the phone and Picasa).

Am I missing something obvious?

What is the best workflow that people have found to go from the Android phone to archival directories on a Windows machine hard drive and then to push the best images up to Google+ via Picasa?

Philip Greenspun’s Weblog

New Location for the Trading Blog

Some of you have already noticed this, but just in case there are still some traders looking for fresh content here I wanted to be sure to point you in the right direction.

I’m moving future posts of the Trading Blog over to TheStockBandit.com, as I’ve been posting there for a few months and that’s where all the new posts and articles will be published going forward.  Please be sure to update to the new RSS Feed to receive all the new posts as they’re published, and get on the email list to ensure you’re notified of any pertinent updates.

The reason for doing this is simply to consolidate content, as we already have a ton of information at the main site to teach and educate traders.  Shifting the blog over there just makes sense so you can get it all in one place.  I’ll continue to share trading insights, discuss the market, review charts, and do whatever I can to keep you on track with your trading.

Please note that the archives here will remain in place, so TheStockBandit.net isn’t going anywhere – it’s just not going to be updated with new posts going forward.  There are 745 posts here which hopefully will continue to be read, because there’s gold in the archives that should not be ignored!

For ease of reference, we’ve also created a new Trading Blog archives page at the main site with the posts there separated by topic, so when you have some free time there will always be something to click on that’s worth a read.

As always, thank you for your continued readership and I look forward to helping you achieve your trading goals!

Trade Like a Bandit!

Jeff White
Producer of The Bandit Blueprint

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