Posts by Rick Newman

  • Eric Cantor to Washington: 'Get with the program'

    Rick Newman at Yahoo Finance 1 day ago

    When he was House Majority Leader, Eric Cantor was one of President Obama’s chief Republican antagonists. These days, however, Cantor sounds more like a pragmatic conciliator than the GOP firebrand who worked tirelessly to kill Obama’s favorite programs.

    “Washington needs to get with the program,” Cantor told Yahoo Finance during an interview at the Milken Institute’s annual conference of business leaders in Los Angeles. “They need to put differences aside and say, ‘let’s go for growth.’”

    Cantor, of course, left Congress last year after his surprise loss to a relative unknown in a Virginia primary election. Fear not: He landed on his feet. Cantor is now vice chairman at Moelis & Co., a New York investment bank, which offers certain satisfactions. “What I like best about being in the private sector is the ability to forge solutions, consummate deals and produce results,” Cantor says in the video above. (It’s a safe bet he also earns more than the $193,400 salary he pulled down as the second-ranking member of the House leadership).

  • Here’s where Bernie Sanders gets his campaign money (which isn’t much)

    Rick Newman at Yahoo Finance 3 days ago

    There is now at least one presidential candidate not beholden to billionaires: Bernie Sanders, Independent senator from Vermont and self-described “democratic socialist,” who will oppose Hillary Clinton for the Democratic ticket.

    Sanders is an anomaly in a legislative body dominated by millionaires. The 73-year-old senator has a modest net worth of about $460,000, which ranks 84 th among 100 U.S. senators. The average net worth in the Senate is nearly $11 million. Though unknown to many Americans, Sanders has been a politician since 1981: first as mayor of Burlington, Vt., then as a member of the House of Representatives, and now as a second-term senator.

    As an advocate for the working class, it’s not surprising Sanders gets a lot of money from labor unions—and virtually nothing from the sort of rich donors funding many other top candidates. Here are Sanders’ top 5 donors during his entire time in Congress:

    Teamsters. $83,700.

    United Auto Workers. $75,400.

  • 10 disasters money pros are worried about

    Rick Newman at Yahoo Finance 4 days ago

    Money managers get paid to worry about what might go wrong, yet even by that standard, some of the world’s most successful financial pros seem surprisingly anxious. At the Milken Institute’s annual gathering of business and finance leaders in Beverly Hills, a vague sense of dread pervades discussion of market movements and global economic prospects. “We live in a messy, scary, dark, uncertain world,” former Treasury Secretary Tim Geithner, now president of private equity firm Warburg Pincus, said during one panel discussion. Resolving issues such as income inequality and overindebted government, he predicted, will be like a “forever war.” Such gloom may seem unwarranted, with the U.S. stock market hovering near record highs, the European and Japanese markets on the rebound and the global economy generally in a state of recovery. But financial gains around the world may have gotten far ahead of economic fundamentals, with other possible disruptions not factored in. Here are 10 unnerving scenarios that could rattle markets: Negative interest rates in Europe. “The idea you’re paying governments for their debt is just crazy,” Alan Howard, co-founder of alternative investing firm Brevan...

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

    Rick Newman at Yahoo Finance 5 days 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.

  • How OPEC could lose the oil wars

    Rick Newman at Yahoo Finance 10 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 10 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

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

    Rick Newman at Yahoo Finance 10 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 12 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 16 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 17 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.”

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    “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.”