I have the same haircut as Obama

I have to admit it I am like Obama because I have a similar haircut-it doesn't make me Presidential material though.

O.K. lets have a full look at the article that the Left is bleating about to deflect scrutiny over secret donations, undeclared funds and lies from Winston Peters and omissions of truth from the Prime Minister over Winnie's behaviour.

Here is the Obama reference in its full context where it makes sense. From the Financial Times.

But John Key, a 47-year-old former Merrill Lynch investment banker and republican, risks arriving ahead of time.

After entering parliament just six years ago he stunned many by taking over in 2006 as leader of the conservative National party and he will become the most inexperienced politician to lead New Zealand in more than 100 years if he succeeds in winning government.

“I’m a bit like [Barack] Obama. I am not institutionalised in Wellington [the country’s capital],” Mr Key told the Financial Times from his parliamentary office. “I had 18 years in the commercial world and I will be quite pragmatic.”

Mr Key said his years in Singapore, London, and New York, where he latterly ran global foreign exchange for Merrill Lynch and spent two years on the foreign exchange committee of the Federal Reserve Bank of New York, would help.

Continued

It was a small, off the cuff comment by Key, the larger part of the article mentions nothing else Obamaesque-thank god for that!!

Duncan Garner on TV3 last night is getting almost as desperate as Helen Clark.

Another fabricated non-story about Lord Ashcroft meeting John Key for dinner, and the Obamarama piece latter on in the TV3 "news".

But he conceded that his experience in finance was useful only to a point. “There are a huge range of issues you need to be across. Economics is good but it is only one part,” he said.

It is very 3rd form video studies type stuff from Garner.

c Political Animal 2008

Helen Clark knew of SFO inquiry before public announcement

Helen Clark today accused the SFO of leaking the inquiry into the Winston Peters/Owen Glenn /Helen Clark donation scandal to the National Party.

Both the SFO and the National Party of course denied it because it was palpably untrue.

Ms Clark latter conceded that the leak may have come from the police or another government organisation-not true again and largely unimportant in the grand scheme of things.

The latest on Clark's accusations of interference by the SFO is that Clark knew on the Wednesday before the SFO announced the next day that Peters would be investigated by the organisation.

This is according to Fran O'Sullivan on Newstalk ZB news on a late news bulletin, Monday 1 Sept.

c Political Animal 2008

Why did you buy that stock? [Fletcher Building Ltd]

As the series Why did you buy that stock? comes to an end-unless I add a new company to the Share Investor Portfolio- the last company in the portfolio I will look at is blue chip darling Fletcher Building Ltd [FBU.NZ]

I have a small holding of 1000 shares which I bought for NZ$9.75 in November 2006 and it has provided me with a gross dividend income of approximately $1400 in total. FBU shares last traded at $7.20 as I write this.


Why did you buy that stock?

Why did you buy that stock? [Freightways Ltd]
Why did you buy that stock? [Kiwi Income Property Trust]
Why did you buy that stock? [Hallenstein Glasson]
Why did you buy that stock? [Briscoe Group]
Why did you buy that stock? [Fisher & Paykel Healthcare]
Why did you buy that stock? [Pumpkin Patch Ltd]
Why did you buy that stock? [Ryman Healthcare]
Why did you buy that stock? [Michael Hill International]
Why did you buy that stock? [Mainfreight]
Why did you buy that stock? [The Warehouse Group]
Why did you buy that stock? [Goodman Fielder]Why did you buy that stock? [Auckland Airport]
Why did you buy that stock? [Sky City Entertainment]



OK Darren, you are not usually too concerned about these temporary market driven figures so whats up?

Well I'm trying to make a point actually.

The fact that I have "lost" $1150 approx since my purchase doesn't concern me. It is a temporary thing and it is due to a number of factors.

Most NZX stocks have been punished by weak overseas markets and fallout from the Sub prime mess and Fletchers is no exception.

Building stocks like Fletchers are also cyclical and the company is facing the bottom of a domestic building slump, in Australasia and in the United States-their products are getting harder to shift.

All these things will inevitably change for the better, and if you are a long term investor don't sell. If you are a short termer, you might as well just bugger off now because this piece ain't for you.

The main impetus for me to invest in Fletcher Building was its pedigree for good management.

The company has existed in one form or another for more than 100 years and has grown from humble beginnings, to today developing into a very large multinational building supplier and manufacturer, retailer and commercial and residential builder in its own right.

Throughout that time it has been well manged and the current CEO Jonathon ling has done a good job so far, with the notable exception of buying the over priced Formica Corporation last year-we can all make mistakes.

As I pointed out above the building sector is highly cyclical and clearly good management is very important. So far Jonathon and his team have managed to weather the current economic storm well.

The previous CEO managed to structure the company in such a way as to diversify the company's revenue streams, so as to make the cyclical ups and downs less, well ,up and down.

Ling looks set to continue this in the future.

More revenue has come from markets outside New Zealand and Australia, with an increase in sales in Asia and America.

Good forward planning has also given Fletcher Building a good backlog of commercial building work in New Zealand and this has clearly offset the downturn in the domestic housing market, in which Fletcher's is the biggest player.

To go back to the price of the share again, when I bought at $9.75, the 60c odd per share in gross dividends represented an approximate 6 % return, which was a better return than the cash rate at the time and of course buying shares in a company that will grow profit means there is going to be a higher capital value for that company eventually.

So value for money and good returns was a compelling tick of the box for me to plunk down my hard earned.

Warren Buffett rears his bald, Coke bottle glasses adorned head again in the last column in this series.

The reason is because Fletcher Building, in my not so humble opinion, has a "economic moat" in some of the sectors in which it operates, it is:

• New Zealand's sole manufacturer of gypsum plasterboard;
• a major participant in the New Zealand steel industry;
• a major producer of aggregate, cement and concrete products in Australasia;
• the world's largest manufacturer of decorative surfaces and high pressure laminates;
• a distributor of a wide range of building materials in New Zealand;
• a substantial construction contractor in New Zealand and the South Pacific Islands;
• a major builder of residential homes in New Zealand;
• a major producer of insulation products in Australasia; and
• the world’s largest producer of steel roof tiles.

An economic moat, as coined by Warren Buffett, is an advantage in business, through dominance in the market and/or strong brands that gives the business a competitive edge, that is very difficult to compete against.

Fletcher Building have that competitive edge, they have strong brands and are dominant in the manufacture and distribution of several building materials and have a large enough and efficient enough infrastructure and well managed employees to be able to construct, commercially or domestically.

These sorts of business advantages are especially important in this heavily cyclical industry and management have clearly understood this.

Fletcher Building's strong brands are well known by consumers and the construction industry alike and even Formica Corporation will end up being a positive contribution once the fat has been liposuctioned from the company hierarchy.

So brands and a big competitive advantage were big ticks for me.

I am not adding any more new companies to the Share Investor portfolio currently or adding additional shares to those companies that I already hold, but I would be buying more Fletcher Building now if I was.

It is a great long term company and is therefore is a blue chip for a very good reason.


Fletcher Building @ Share Investor

Fletcher House built on hard times
Fletcher Building down tools in the short term
A solid foundation for the future
Fletcher Building raises profit through canny management
Fletcher's got game


Related Reading

Fletcher Building History - Auckland University


 Click here for full Media Release - FBU 2008 Annual Results



c Share Investor 2008

N' PARTY PRESS RELEASE: Launch of Billboard

National Party Leader John Key today launched the first of a series of billboards highlighting the issues the party believes matter to New Zealanders.

The billboard, on taxation and migration, was launched in Auckland this afternoon. The same billboard is going up at sites in Wellington, Christchurch, Hamilton, and Tauranga.

"Our first election billboard promotes our intention to introduce an ongoing programme of personal tax cuts. It will be a responsible and a transparent programme," says Mr Key.

"National will build on Labour's planned October tax cuts. We will treat those as the first tranche in our tax cut programme. There will be further tax reductions on 1 April 2009, and again on 1 April 2010.

"The billboard also highlights Labour's failure to stem the tide of people voting with their feet and leaving New Zealand. "The figures are sky-high. Recent statistics show that more people than ever are leaving. In the year to July, 80,872 people packed their bags and headed overseas for good.

"That's the highest loss for a year ended July since 1979, and the second highest loss ever. The figure equates to more than 1,500 people per week. "Half have left for Australia, where average after-tax wages are now one-third higher than in New Zealand. "Labour has done nothing after nine long years about this problem. National is not prepared to stand by and do nothing. I believe it is time for New Zealanders to choose a brighter future.

"National believes the public is ready for a fresh start from a new government," says Mr Key.

"Over the next two weeks we will be unveiling a number of other billboards on the core issues that a National government would want to make progress on after the election."

PDF of Billboard: http://national.org.nz/files/2008/wavegoodbye.pdf