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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Tommaso who wrote (12771)	7/13/2001 1:30:28 PM
From: Dale Baker	Read Replies (1) \| Respond to of 78511

Hey Tommaso - thanks again for mentioning MAGS long ago. Hit a clean two-bagger with the move to $8 today. Regards. PS have any more like that?

To: Tommaso who wrote (12771)	7/13/2001 1:36:23 PM
From: Paul Senior	Read Replies (2) \| Respond to of 78511

re: "Maybe I should cash in my policy as soon as I get my shares and buy more of the stock." Yikes! Way, way too frightening a statement for me. You might do okay coming here imho to get some ideas about taking stock or not taking stock. To make the decision though to cash in the policy, that requires expert assistance from someone who knows you and your family and your financial situation. I'll step out and give my opinion once again. I hope it sounds good, but regardless, the one thing for sure is that it should be taken in the light that it is just coming from some opinionated jerk (me) who has no qualifications in financial planning or the insurance business. Insurance is to be bought to protect a stream of future earnings. (We are talking about your straight life type policies). If there are no earnings to protect, then straight life policies should not be bought. (I'm giving MY opinion here). So, if a wife doesn't work, doesn't have an income stream, then there's no need to have an insurance policy on her such as a life-insurance policy. Selling insurance policies on children (who don't work) is a vehicle for sales by insurance people, but I'm saying it's not in the best interests of most buyers (again, that is my unqualified opinion). I carry this as well to retired people or wealthy people who don't work. (Their assets provide the future earnings stream if that is required by family members). And the insurance need only cover the required future earnings stream. (again, imo). One doesn't overinsure if one focuses on the primary (imo) purpose: protect a future stream of earnings. If the person needs the forced savings that some insurance policies provide, that could be another matter. Since the savings component in insurance is low (from what I understand), a little discipline by the buyer in other areas (TIPS, mutual funds) might serve the person better. I have read where some people who have said they want insurance have decided that they are better off (in accumulating some savings) by buying stock in the insurance company on regular intervals, rather than buying the insurance itself. My point, after all this, is that if a person doesn't need to protect a future stream of earnings, then no insurance is necessary (again, just my opinion). But if one needs to protect a stream of future earnings, then that's what insurance is for, and the person should not make a decision to dump such insurance without careful consideration of the risks associated. (If we are talking swapping insurance - straight life for term, for example, that is a different story. Here's where a unbiased professional helps) Paul Senior

To: Tommaso who wrote (12771)	7/13/2001 1:51:07 PM
From: jeffbas	Respond to of 78511

Thanks, Tommaso for your kind comment. Insurance was my business and my opinion is that a policy loan would not affect the amount of stock you get. I am sure you have a phone number to ask any question about the demutualization that you want. Ask them. As far as trading in your policy to buy more stock goes, you should remember that the policy is to protect your survivors against your untimely death. Making money on investments is a distinctly different issue. On another subject, a couple of money losing companies have been brought to me as trading below net cash on the balance sheet, which have also been mentioned by some money managers - SSSW and TALR. I took a look and have a couple of observations to show how I look at these. Both companies pass the acid test in my opinion of being able to live on their cash until the next recovery. Neither pass the acid test that a huge increase in sales is not required to reach break even. Both require major increases, determined by comparing current gross margin dollars from current sales with current operating losses. Therefore, this makes such companies worth more dead than alive - to an acquirer in the same business who can keep the cash and get rid of the expense keeping them from profitability now. Some of these will indeed be bought. However, I think that is an insufficient justification for investment.