Posts by Rick Newman

  • Sen. Lindsey Graham: Send U.S. troops to topple Assad

    Rick Newman at Yahoo Finance 5 hrs ago

    Specific proposals to end the appalling violence in Syria, Yemen, and territories controlled by the Islamic State group are scarce in the nascent presidential campaign. That is about to change. Republican Sen. Lindsey Graham of South Carolina -- who tells Yahoo Finance he’s “92-and-a-half percent sure” he’s running for president -- wants to send U.S. troops back to the world’s most volatile region to stamp out vicious terrorism and remove Syrian President Bashar al-Assad. “Assad has to go,” he says in the video above. “We’re going to have to send some of our soldiers back into the Middle East.” Many world leaders, including U.S. President Barack Obama, would love to see Assad booted from power. Assad has presided over a four-year-old civil war that has so far caused at least 210,000 deaths and forced nearly four million Syrians to flee the country. Assad’s troops have dropped unaimed “barrel bombs” filled with shrapnel on civilian areas, and used chemical weapons, in violation of international treaties. Desperate Syrian migrants are fueling the human trafficking crisis in the Mediterranean that has led to hundreds of drowning deaths as victims try to get safely to Europe. Finding a way to remove the wily Assad, however, is no easy matter. The Obama administration tried to provide arms to some of the factions fighting Assad, but basically gave up, saying it was too hard to identify reliable allies. Graham’s approach would be far more muscular. He’d help form a regional force with 90% of the troops coming from Arab nations, and 10% coming from the U.S. Graham has previously said the number of troops he’d commit might total 10,000 or so. “I would integrate our forces within a regional army,” he says. “There’s no other way to defend this nation than some of us being on the ground over there doing the fighting.” A commitment of that nature would almost certainly require U.S. combat forces to deploy -- some to help train foreign armies but others to man the front. U.S. forces are generally more highly trained than Gulf armies, especially with regard to high-skill missions such as rapid armored maneuvers, special operations, logistics, reconnaissance and close-air support. “We can provide capability on the ground the Arab world doesn’t possess,” Graham says. There are several obvious drawbacks to such a plan. It would be highly controversial and might not even draw strong support from Republicans. The Pentagon might resist too, since it usually objects to joining any coalition it doesn’t control. Graham is an Air Force reservist who has spent 33 years on active and reserve duty in the Judge Advocate General Corps, which gives him more credibility on national security matters than others with no military background. Still, many Americans would probably object to sending U.S. troops into another intractable Middle East conflict, after more than 4,400 died in Iraq. If military force did remove Assad, there’d still be the problem of whom to replace him with, lest Syria become another lawless state, similar to Yemen or northern Iraq, ripe for occupation by the Islamic State or other offshoots of Al Qaeda. “You’d have to get a political coalition to rebuild Syria,” Graham acknowledges. Easier said than done.

  • How OPEC could lose the oil wars

    Rick Newman at Yahoo Finance 4 days ago

    The U.S. energy industry is clearly on its heels. Drillers are shutting down rigs, oil and gas firms are slashing jobs and plunging prices are gutting profitability, even at huge firms such as Exxon Mobil (XOM).

    But American drillers could ultimately benefit from the pressure to become more competitive. And OPEC, the oil cartel led by Saudi Arabia, may end up regretting its effort to push down oil prices and destabilize American drillers. “We’re wounded but we’re not dead, for sure,” Gary Evans, CEO of Texas-based driller Magnum Hunter Resources (MHR), tells me in the video above. “If their goal was to crush the US oil and gas industry, that isn’t going to happen. We are a very resilient industry.”

  • This car is keeping GM afloat

    Rick Newman at Yahoo Finance 4 days ago

    Drivers have gotten a break this year with cheap gas, but the lower cost of fuel is an even bigger boon for automakers with big trucks and SUVs to sell. And nobody may be benefiting more than General Motors (GM).

    The nation’s biggest automaker had a rough first quarter, with problems in Russia, other parts of Europe and South America crimping profits, which came in below analyst estimates. The company's shares were slightly lower in premarket trading Thursday on the disappointing news. But GM had a banner first quarter in its home market, with $2.2 billion in pre-tax profits in North America, more than three times its profit from the same period a year ago. The biggest contributors were pickup trucks and big SUVs — an improbable return to the glory days of the mid-1990s, when SUVs became king of the highway and GM banked some of its heftiest profits ever.

    The success of the Chevy Tahoe

    [Get the Latest Market Data and News with the Yahoo Finance App]

    Related Video:

  • Why Ted Cruz, Rand Paul — and Russian oligarchs — love the flat tax

    Rick Newman at Yahoo Finance 5 days ago

    And now, making its quadrennial, limited-engagement appearance before voters: the irresistible, feel-good, stump-speech staple known as the flat tax!

    It’s so appealing, the flat tax. You just trash the entire labyrinthine tax code and start over with a system so simple it can be printed on one page. Two Republican presidential candidates — Sen. Rand Paul of Kentucky and Sen. Ted Cruz of Texas — favor a flat tax, though neither has spelled out the details of his plan. Sen. Marco Rubio of Florida, another presidential candidate, has a more detailed plan that would compress six income tax brackets into two and incorporate other ideas drawn from the flat-tax playbook. Assuming Jeb Bush enters the race, it’s likely he’ll call for a simpler and less burdensome tax code as well, as Mitt Romney did in 2012.

  • It’s time to stop worrying about Greece defaulting

    Rick Newman at Yahoo Finance 7 days ago

    Sure, it could happen. Greece could snub its lenders, run out of money, fail to secure additional funding and default on its debts. But the consequences wouldn’t be as horrific as many investors fear and jittery markets seem to anticipate. A Greek default, in fact, might be the very thing that speeds resolution of the whole Greek drama.

    A Greek default would deepen the misery ordinary Greeks are enduring. But default wouldn’t necessarily force Greece to leave the euro zone and go back to its old currency, the drachma. Many press reports, in fact, treat default and a eurozone exit as synonymous. They’re not.

    Rick Newman’s latest book is Liberty for All: A Manifesto for Reclaiming Financial and Political Freedom. Follow him on Twitter: @rickjnewman .

  • An alarming new way to steal your passwords

    Rick Newman at Yahoo Finance 10 days ago

    At a restaurant, you pull out your phone to check email. Without even thinking about it, you tap in a PIN to unlock your phone. Your back’s to the wall and nobody can see what you’re typing, so there’s no reason to worry that somebody could intercept your passcode.

    Except, sadly, there is. Researchers at Syracuse University have demonstrated that hackers can guess PINs by analyzing video of people tapping on their smartphone screens -- even when the screen itself isn’t visible. Software used to analyze such video relies on “spatio-temporal dynamics” to gauge the distance from the fingers to the phone’s screen, and then approximate which characters the fingers tap on a keypad. “It’s like lip reading,” says Vir Phoha, an engineering and computer science professor at Syracuse and co-author of a paper on the technology. “Based on hand movement and the known geometry of the phone, we can see which keys are pressed.”

  • How Wall Street may threaten your pension

    Rick Newman at Yahoo Finance 11 days ago

    Most people with a pension probably don’t think much about the fees assessed to manage their retirement money. But maybe they should.

    Recent reporting by journalists Neil Weinberg and Darrell Preston of Bloomberg reveals that some pensions invest money with private-equity firms and other alternative investment firms that charge unusually high fees, whether the money earns a positive return or not. The funds also require a high degree of secrecy as a condition for investing with them, which runs contrary to basic principles of sound investing. “It is a big concern, because if this money goes into the private-equity firms, it’s not there for the pensioners,” Weinberg tells me in the video above. “Their benefits are at risk.”

    [Get the Latest Market Data and News with the Yahoo Finance App]

    “If you look into many of these documents, they're not trade secrets,” says Weinberg. “It’s business strategy-type stuff. It has to do with fees, with conflicts of interest. It has to do with some really troubling things.”

  • Your tax bill isn’t as bad as you think

    Rick Newman at Yahoo Finance 12 days ago

    Tax Day is always a grim reminder of how much of the money you earn you don’t get to keep. But taxes are the price of living in a civilized society (ahem) and here in the United States, the tax burden isn’t all that bad, in general.

    The typical American pays 31.5% of his or her income in taxes, including federal, state and local income taxes, plus the amount taken out to fund Social Security and Medicare. (That figure also includes the employer contribution to Social Security and Medicare, which might otherwise be added to your paycheck as income.) That’s a big chunk of money, but it’s lower than in most other advanced countries.

    For all the angst over taxes in America, the tax burden on most people has declined during the last 35 years. President Obama raised some taxes beginning in 2013, but that mostly affected high earners. For many middle-income families, the effective federal tax rate -- after deductions and other tax breaks -- is the lowest it has been in decades, as this data shows:

  • Chris Christie is showing how to lose an election — by 'reforming' Social Security

    Rick Newman at Yahoo Finance 13 days ago

    New Jersey Gov. Chris Christie is already losing—and he hasn’t even declared his candidacy yet.

    Christie, who may eventually join the pack of candidates battling to be the Republican presidential nominee in 2016, has attempted to demonstrate his readiness for office by tackling a big and important idea: The need to make Social Security and Medicare more financially stable. Without any changes, Social Security will run short of money sometime in the mid-2030sand Medicare will flatline a few years earlier. Everybody in Washington knows these entitlement programs need to be revamped. But few politicians are willing to propose specific ways to either cut back benefits or raise taxes to keep the program fully funded.

    The most prevalent objection is the idea that retirees who contributed to Social Security their whole working lives would get short-changed in retirement if the government cut back benefits — no matter how wealthy the recipient. Here’s one of many examples:

    3. Key lobbying groups such as AARP will have to back the changes.

  • Hillary Clinton is bashing CEOs -- while taking their money

    Rick Newman at Yahoo Finance 13 days ago

    It’s unremarkable these days to hear somebody bad-mouthing CEOs who pull down 7-, 8- or even 9-figure salaries. Unless the bad-mouther is Hillary Clinton.

    The leading Democratic candidate for president has kicked off her campaign with a mild but unexpected jab at the leaders of corporate America. In an email to supporters right after declaring her candidacy, Clinton lamented the strains on ordinary families “when the average CEO makes about 300 times what the average worker makes.” Analysts interpret the populist remark as a leftward turn meant to appease liberals outraged over soaring income inequality and the outsized lifestyles of the one percent.

    [Get the Latest Market Data and News with the Yahoo Finance App]

    Here’s a sampling of businesspeople in the top tier of donors — giving $25,000 to Ready for Hillary — according to the Center for Responsive Politics:

    Eli Broad, retired entrepreneur who made billions in insurance and home building. Estimated net worth: $7.1 billion.