Chart: Five-Year Performance of Major North American Railroads

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The chart below from Yahoo Finance shows the performance of the major North American railroad stocks over the past five years:

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US-railroad CSX  Corp (CSX) is the best performer with a growth of about 150% followed by Union Pacific (UNP). Of the two Canadian railroads, Canadian National (CNI) has performer better than Canadian Pacific (CP). It must be noted that Microsoft’s Bill Gates is the largest shareholder in Canadian National. His Cascade Investments LLC owned over 34 million shares of CNI at the start of 2009. CNI is also one of the largest 20 holdings in the portfolio managed by Cascade. All five stocks have recovered nicely from the March 2009 lows.

Disclosure: Long CSX, NSC, CNI

Global Finance Mag: Stars of China – Top Companies and Banks

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The latest edition of Global Finance magazine lists the top Chinese companies and banks in various categories. These top ranked firms are shown below:

a) Stars of China – Banks

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b) Stars of China – Companies

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Some of the key points mentioned in the Global Finance report include:

  1. China Merchants Bank’s (CIHKY) retail lending now accounts for more than one third of the bank’s total lending portfolio.
  2. Among the foreign banks operating in China HSBC (HBC) has the largest banking network in terms of total outlets and geographical reach with 100 outlets.
  3. Industrial and Commercial Bank of China (IDCBY) has issued the largest number of credit cards by partnering with supermarkets, department stores and other merchants. As a result of this, the bank saw its credit card portfolio increase by 35.4% from the same period last year.
  4. By buying Volvo, Geely has gained an edge over competitors in its goal to sell cars in North America and Western Europe.
  5. Beer maker Tsingtao Brewery (TSGTY) profits in the first half of this year was up by about 30% relative to the same period last year.
  6. In addition to holding  about 29% of domestic PC market, Lenovo holds about 10% the global market share.
  7. CNOOC’s (CEO) revenue and profits doubled year-on-year in the first half of the year and production also increased by 41%.
  8. Goldwind’s business is growing strongly due to China’s big push into the renewable energy sector.
  9. Huawei Technologies supplies telecom-related products and services to 45 of the world’s top 50 telecom operators.


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The Great Wall of China, Jinshanling

Magyar Telkom Delisted from the NYSE

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Magyar Telkom, the leading Hungarian telecommunications service provider became the latest European to delist its ADRs from the New York Stock Exchange. The ADR which used to trade under the ticker MTA was delisted as of November 11, 2010.

Effective 11/12/20, the ADR will trade on the Level 1 category on the OTC markets with the ticker MYTAY.

The company majority owned by Germany’s Deutsche Telecom (DTEGY) made the announcement to delist back in June. The reason for the delisting is “to reduce complexity in financial reporting and administrative costs. The Company remains committed to serve its investor base in the United States, as well as to comply with the highest standards of corporate governance, and to provide transparent financial reporting.” It may noted be that Deutsche Telecom already delisted from the NYSE and now trades on the OTC markets as well.

With this delisting, none of the Hungarian companies are trade on the NYSE. The other four Hungarian ADRs that trade on the OTC are Fotex (FOTXY), Genesis Energy Investment (GEIVY), MOL Magyar Olaj-ES Gazipari (MGYOY) and Pannonplast (PNPSY).

At the closing price of $14.33 yesterday the stock pays a hefty dividend of 11.60%. In addition to providing fixed-line telecom services in Hungary,  Magyar Telekom also offers services in Hungary, Macedonia and Montenegro and acts as an alternative service provider in Bulgaria, Romania and in Ukraine.

Disclosure: No positions

How Does the Federal Government Spend Our Taxes?

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Americans pay billions of dollars in taxes each year to the Federal government. However when it comes to knowing how the government spends the taxes collected many people have misconceptions.

From an recent article in The Wall Street Journal:

“A recent Kaiser Family Foundation survey found that 40% thought foreign aid was one of the two largest federal-budget expenses. In reality, Uncle Sam spends $14 on Medicare—itself the second-largest expense—for every dollar spent on foreign aid.”

The reality is that U.S. gives lower foreign aid than many other developed countries based on Gross National Income. In 2009, Sweden and Norway were the top donors. In addition, the majority of U.S. foreign aid went to countries such as Iraq, Afghanistan, etc. for political and strategic reasons.

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The not-for-profit Washington-based group called Third Way has produced an itemized taxpayer receipt shown below for the federal taxes of two couples:

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Assumption: “The couple with $200,000 income has two children, ages 13 and 17, with one spouse earning $150,000 and the other $50,000. The couple with $100,000 of income is retired, with no dependents.”

Other then Social security, Medicare and Medicaid and Interest on national debt are two items that the Federal taxes spends the most tax dollars on. The portion of taxes going to Interest on national debt item is so high because as of 11/9/2010, the outstanding US debt held by the public is 9,135,403,570,564.55 according to the U.S. Treasury Department. The U.S. is net debtor country. Hence billions of dollars are paid by tax payers each year as interest payments to debt holders. A huge chunk of these interest payments is paid to China as they are the largest creditor to the U.S.  Last year the government paid about $500 billions in interest alone. In 2008 interest payments amounted to about 9.6% of total tax revenue. In one way it can be considered that about 10% of all federal taxes paid goes to waste in the form of interest on money borrowed. Another way to look at this figure is that 10% of all hard-earned money paid as taxes to the U.S. government goes to unproductive purposes because years of reckless borrowing and spending created the enormous public debt.

Related:

China vs. India: Economy and Government Finances

USA vs. UK: Government Finances and Size of Economy