Jurgis

Thanks oddballstocks! 8) Wow, that's a really bad plan.

Thank you tede02. I think this clarifies things to me and helps me to be more aware of these in the future. For full disclosure (which I did not want to do before I got the info, so the info would be unbiased ;) ): yes, these were big companies (>10K employees). The "good" (or better) plans used Fido. The worse one (see SP500 equivalent fees) used Prudential. One of the plans even had brokerage option, so I could buy stocks there as in regular Fido account. But as I said, this gives me the color for things to be careful about.

SimpleInvestor: buybacks always look bad if the share price of the company keeps dropping, since shares were bought at higher prices than now. This does not by itself mean that buybacks were wrong; it's very tough to buyback at the bottom - the same way it's tough for investors to buy at the bottom. Assuming one likes IBMs business plans and prospects (I don't), the buybacks were/are pretty rational.

I would be willing to make a significant wager that the 401ks you and your wife participated in did in-fact charge significant fees that you never saw. How? Employer may have paid the fee, but how do you charge a fee that I never see? I see what comes out from my paycheck. I see what goes into 401(k). Nothing disappears in between. It's not that suddenly I have 98% of what I contributed. Tell me what's the trick. How can you remove the fee without hitting the statement? Special share class, I can understand. What I saw was the opposite: 401(k) gets the big mutual fund classes that have lower fees than retail. I did not check share classes and fees for every single fund in the offering. Edit: I also understand that they can have crappy funds that charge more than equivalent. I guess they can also have a crappy cash (money market) fund, though it's tough to skim much from cash fund nowadays. This trick doesn't work very well for them if person puts 100% into SP500 index fund that's a Vanguard or equivalent. I looked at couple plans. Best SP500 "equivalent" I see has 0.04% fees, so they are not skimming from this one. Another plan has 0.32% fee SP500 "equivalent". So that one could be giving them 0.25% or so of delta fee vs 0.04%. Can't get to 1-2% though. I seriously want to know: how do you remove money from the plan without hitting the statement apart from bad funds or bad fund classes? Edit: not that this forum's participants need warning, but sure if you put money in crappy "target date" funds or funds-of-funds or some "special" products they sometimes have in 401(k) - I forget the names - these can definitely have 1-2%+ overhead. But that's not what I am asking about. I am asking how they can charge 1-2% hidden fee on 401(k) participant that puts all money into SP500 index "equivalent" fund.

OT 401(k)s I've heard people complaining about 401(k)s and their fees in the past, but I am completely not sure where they are coming from. I've had couple 401(k)s in the past and my wife had couple too. None of them had fees that employee had to pay. All of them had cheap index funds at least (some of them had much more than that, but we probably all agree that cheap index funds are enough). Have I just been lucky to be in right companies/401(k)s?

Buying back shares in declining business does not make management shareholder friendly. IBM needs vision and business execution, not more financial engineering.

IMHO spin-offs were never easy money and they are even less so nowadays. So to answer your question: it depends. You have to do pre-split and post-split analysis, evaluate the price & value at these points and decide based on that. Companies are not so stupid nowadays and you can't know without work which part of the spin off (if any) will be good investment. Look at PGN or HYH or RYAM. I have not done any work on AA.

This is an important point. Even though rkbabang is aware of odds in this case and processing it "right", it is very likely that he - and actually every one of us - respond to some other cases as "moist robots": completely inadequately. :) It's very hard to avoid such responses, especially since life situations are much more complex than a binary example we were talking about.

One thing: yes, we should adopt the easy "no cost" methods: 1. Tell your kids to look both ways when crossing the street. Tell them to wear seat belts even in back seat. 2. If you are teacher/professor, it does not hurt to know how you can lock your classroom door (or where the closest fire extinguisher is). Yeah, 1. is still probably 100 times more worthwhile than 2. But 2. does not cost much and so it does not hurt much either. Take care.

Depends on where you live. For most places in USA and developed countries, you are right.

Because life is about choices and about resources. You might not need Tesla engineers, but you may need money, time, political will, campaigning, etc. It would be wonderful if we could resolve all issues facing humanity, but we can't. My point is that we make a lot of bad choices because we ignore statistics. Edit: perhaps I should have asked "would you contribute your money/time/effort to A or B". It seems that voting is easy, sure, you can vote for A and B and C. Not so if you have to spend something. Assume you can contribute to charity/organization that is working to reduce A or B. What then?

Although I disagree with school shooting characterization as: I agree that humans/humanity in general are very bad at making statistics based decisions. There are numerous issues that are not focused on even though working on them would yield huge benefits and vice versa there are numerous issues that consume huge resources even though they are statistically insignificant and the resources are wasted. Edit: Just for illustration to Pauly: Assume that a chance of your child getting killed in school shooting is 0.00001%. Assume that a chance of your child getting killed in auto accident is 0.001%. Assume you can vote only for only one solution: A. Reduce a chance of your child getting killed in school shooting 10 times. B. Reduce a chance of your child getting killed in auto accident 2 times. Would you vote for A or for B? Why? You are welcome to change percentages and numbers yourself.

What was it like when cars started having cruise control? Did it spike the accident rates because people used it wrong?

Although I am all for driverless cars, I disagree with last sentence. Human drivers with assisted technology can be much better than they are already. E.g. blind spot notifications. If car tells you that there's another car in your blind spot, you will likely avoid the accident. That improves human as a driver. So the comparison should not be "humans in 2010 cars" vs. "driverless cars". It should be "humans in 2017++ cars" vs. "driverless cars". ;)

Hah, we've had this discussion before. You'd think Google and Yahoo would value their finance platforms as premium places for ads. And yet they are treated as red headed stepchildren... Bonkers.

First of all, big +1 for randomep. :) Agree with that. I think we all do. And yet is there anything better? Yes, but not if they decide to go Volkswagen and discard the data that shows issues in replication. We will have to see how this works out. She's definitely not a martyr that bulls try to depict her: she has tons of money, great backers, contracts. So really Theranos should show results. Should not be tough with X$B warchest, no?

There's no way they gonna do $80b-over-3-years FCF if you include maintenance capex. $80b-over-3-years is OCF.

How exactly they are going to generate $80bn of cash over the next 3 years? Is this FCF after capex? OCF? Edit: it looks like they might do $20B OCF this year, so I guess $80bn in next 3 years is also OCF.

You guys are saved: http://money.cnn.com/2015/10/09/news/companies/bunny-ranch-brothel-student-loan-matching/index.html?iid=ob_article_footer&iid=obinsite 8) Talk about great management... where do I invest? 8)

thepupil: I'd have to sit down with you and show the stuff that grates me on their website. I don't think I can express it easily with text. Sorry. The tax worries are still in the future. This is right now second-hand info. AFAIK they support Turbo Tax, but not Turbo Tax Online. I'd be very happy to hear differently. (Also I am concerned about the foreign currency tax importing, but this would be the same for any broker). I did not call their customer service - as I said, I don't have my main account there - so this is only second-hand info. Perhaps they are comparable to Fido. From what I hear, they are not. I am pretty sure they don't support solo 401(k)s like Fido. Edit: Do they allow buying individual bonds? I do that on Fido. Not a huge deal possibly. I agree that their two-factor authentication is great and that commissions are great if you manage to setup things in the right way and you don't fall into one of their "beware" holes (so far I only saw "minimal monthly fee" because of too few trades or something like that). Hope this helps.

Wrong. I have an account with IBKR. Like I said before: awful. I only have it because it's managed by someone else and they rely on IBKR's platform to do this (this was covered in the thread about separately managed accounts). To be honest, even though performance of person managing it is great, I have periodic thoughts to close the account because of IBKRs horribleness. So far I endure. Edit: Ask me again at tax time - I expect the online Turbo Tax nightmare. Perhaps I will be surprised on the bright side. This does not apply to you as you are not in USA. Perhaps this also answers to Liberty regarding the pain threshold of delta compounding. ;)

Perhaps. But ultimately I pay Fido <0.5% of my assets for all the services they provide. Sure, I might pay IBKR only 0.1%, but it's not worth the headache for me. (The percentages are somewhat crude estimates. They are likely lower for Fido and possibly for IBKR). One way to look at it: How long do you plan to invest and how much of a cumulative difference does that delta adds up to compounded over that period? Another way to look at it: how often IBKR can give you a stroke or a heart attack because something is screwed up? You might not survive to enjoy your cumulative difference. #qualityoflifematters

Perhaps. But ultimately I pay Fido <0.5% of my assets for all the services they provide. Sure, I might pay IBKR only 0.1%, but it's not worth the headache for me. (The percentages are somewhat crude estimates. They are likely lower for Fido and possibly for IBKR).

Perhaps. Or perhaps there is an inflection point where there is no longer enough work for humans. There are valid arguments why this time is different. But I agree that it might not be. Edit: there is also potential issue of hollowing out that I brought up above. I.e. there might be work only for computer scientists, Ph.D. level bio/pharma and materials engineers, but majority of people won't be able to get to that level of education/proficiency/etc. Only in certain countries and certain occupations. But, yes, I don't disparage our current status of civilization. It is the best we've had so far.

Horrible website, interface, reports. Also with Fido I know that I only need to call and any complex issue will be cleared. I haven't had an issue with Fido phone (or Internet chat) support yet (fingers crossed). Even if they can't resolve it immediately, they dig until they can. Also Fido has solo 401(k) support. This for me is worth a lot. Ah, sorry, I am not IBKR investor. :)