Minister-Communist Karpenka: We To Exclude "Some Abstruse Things" From Textbooks
33
Ihar Karpenka
An authoritarian regime doesn't need people who are too educated.
New textbooks correspond to new academic programs. Minister of Education Ihar Karpenka announced this on the air of ONT channel.
In total, there are more than 250 textbooks. So far, not all of them have been updated (41 new textbooks were released this year). Curricula were updated for the new academic year, methodological recommendations for each subject were published.
"A teacher will clearly know what to teach from old textbook and what not to teach, – the minister noted. – All new textbooks will be published by the end of 2019." By the way, some corrections can be made at their release, it's a permanent process, he added.
An open competition is held to discuss the content of the textbooks. Ihar Karpenka invited all critics of published textbooks to participate.
As for the new academic programs, in particular, in mathematics, then, according to the minister, they excluded "some abstruse things" from them.
At the same time, Ihar Karpenka emphasized the importance of training teachers, their ability to use materials included in the academic programs and textbooks.
As for the five-grade and ten-grade scale of assessment of knowledge, the minister believes that this issue is not simple, therefore it requires wide discussion, first of all, by educators.
High Dividends, Low Taxes: A Careful Investor's Guide To Preferred Stocks
L
ooking for cash flow in a taxable account? Consider preferred stocks—but first get a reading on their “qualified dividend income.”
J.P. Morgan Chase pays a good dividend, yielding just over 3% on the common shares. Not good enough? You can get more. JPM has some uncommon shares yielding well above 5%.
We’re talking about preferred stock, that very unfashionable kind of equity that pays a fixed dividend and thus acts a lot like a bond. If you need investments with a high payout, preferreds are worth a look. And if you are investing in a taxable account, they are worth a close look. Some of them pay dividends qualifying for a reduced federal tax rate; many don’t.
Ryan Garcia for Forbes
What follows here is a beginner’s guide to this fixed-income sector. Be forewarned that assembling a portfolio of preferreds is a challenging assignment. It’s hard to find good stocks, hard to get prices for them and hard to get information on that vital matter of tax rates.
Our sherpa for this journey is Michael Livian, 47, a U.S.-born chartered financial analyst whose European upbringing explains his fluency in four languages. He is chief executive of the mid-Manhattan money manager Lehmann Livian Fridson Advisors. (Forbes distributes a newsletter published by Marty Fridson.)
Livian is an intense researcher, given to abstruse statistical analyses of coupon rates, credit ratings and price momentum. Here’s the end point of all that data work: Preferred stocks are a pretty good buy at the moment.
The portfolios Livian manages for income-hungry retirees usually combine common stocks with fixed-income elements like junk bonds and preferred stocks. He’s not adding much junk these days, he says: “From the perspective of generating income and preserving capital today, you’re better off in cash and high-yielding preferreds.”
Preferreds from solid issuers are somewhat risky. They got mauled in the financial crisis, but most of them kept up their dividends and the prices recovered. Except for the favorable tax treatment sometimes available on their dividends, high-quality preferreds are on a par with low-quality bonds. Which is to say: The preferred equity of a class act like J.P. Morgan is about as risky as the debt of a trashy company like General Electric.
As with junk bonds, so with preferreds: You get a high payout, an occasional hit to principal and no growth. We’re talking about straight preferreds, by the way; the ones that convert into common shares are an entirely different animal.
Preferred stock ranks between debt and common stock in a company’s capital structure. That means that, in times of trouble, owners of preferred stock must be sacrificed before bondholders suffer any damage. A company’s directors can suspend a preferred dividend on a whim; they are, however, motivated to keep paying because they cannot pay a dividend on the common shares in any quarter unless the preferred holders get their full piece in that quarter.
Sometimes trouble arrives suddenly. The preferred shares of Freddie Mac were considered gilt-edged a little over a decade ago. When this company was bailed out by the federal government the preferred holders were flushed down the drainpipe. Be thankful if you did not buy preferred stock in Pacific Gas & Electric just before California caught fire.
So the first rule is: diversify. Buy a dozen issues if you buy any.
Next rule: trade cautiously. Many preferred stocks have thin volumes. “Price movements are idiosyncratic,” Livian says. Meaning, the ask price may bear only a faint relation to the value of the share. He recently noted a Kansas City Southern preferred trading to yield less than the less risky debt of the same issuer. That makes no sense.
Livian recommends that you buy or sell only with a limit order, spelling out the worst price at which you are willing to transact. Don’t put in a stop-loss order, causing an automatic sale when the price dips. In a thinly traded stock, he says, that’s an invitation to get whipsawed.
Next: beware calls. Almost all issuers of preferred shares reserve the right to redeem them anytime after a certain date, often five years from the date of issue. Disappointing but tolerable if the share you bought new for $25 gets taken away at $25. Painful if you paid $26.50.
Before buying a stock at a premium over par value, look at the earliest call date and figure out what your return would be if the issue is called and your premium vaporized. Roughly speaking, the yield to call is equal to the coupon on the security minus the annualized decrement to principal.
Livian goes beyond the numbers. He considers an issuer’s need for capital and the expense it might incur to refinance a preferred with a new issue carrying a slightly lower coupon. In some cases he is willing to make a calculated bet that a stock won’t be called soon. He likes both the Schwab Series D and the KKR Series A, despite low yield-to-call numbers for these issues.
Last item on our agenda is the tricky matter of taxes. Some issuers dish out payments that qualify to be federally taxed at the favorable rates on long-term capital gains (0% to 20%, not counting the 3.8% Obamacare surcharge). “Qualified dividend income” is the IRS lingo. Investing in a taxable account, you want all your dividends to be QDI.
Dividends from a bank or insurer are likely to be QDI. Dividends from a real estate investment trust or energy partnership are very unlikely to qualify. Dividends from so-called “trust preferreds,” which are really bonds carved up into $25 pieces, do not qualify. Don’t own a non-QDI share unless you can stuff it into an IRA.
Livian counts 932 preferreds with enough trading volume to have meaningful price data. Roughly half, he says, are clearly QDI issues, with tax treatment of the rest either unfavorable or murky. Issuers are almost always mum on this point, perhaps because they can’t be sure of how their payouts will be treated in any given year until the corporate tax return is complete. I expect all of the stocks in the table to be paying QDI in 2019, but there are no guarantees.
Getting info on preferreds and funds that own them is a chore, beginning with the tickers. The share that goes by JPM-PC on Yahoo Finance is JPM.C on Google Finance, JPM/PC on Fidelity and JPM/PRC on Schwab. Fidelity doesn’t tell you when the security can be called; Schwab has an answer to that question but it doesn’t agree with what’s on J.P. Morgan’s investor page. Morningstar reports that the portfolio of the Invesco Preferred ETF (PGX) has an average credit rating of AAA, which is quite at variance with what Invesco says.
A Bloomberg terminal gives you all the statistics you might want on a preferred stock. If you don’t have one of those things, be creative. Take a peek at the financials for a fund that owns preferreds. For call dates and credit ratings, the portfolio page that Invesco publishes for PGX is quite helpful.
The annual report for Flaherty & Crumrine Preferred Income (PFD) conveniently flags issues that have been paying QDI. The Invesco Financial Preferred ETF (PGF) tracks an index for which QDI is a criterion, so, if you don’t mind a bank-heavy portfolio, you could copycat its big positions and be reasonably assured of collecting QDI. QuantumOnline has a rich data set (free with registration) that includes a QDI screen.
Is all of this headache worth it? I think so. Net of damage to principal when a premium-priced stock is called in or your utility inadvertently torches the countryside, you can expect a return of 5%. Allow for a 15% federal tax (relevant to most of the people reading this paragraph) plus a 3.8% surcharge (for the ones with income over $250,000) and you’re left with 4% and a fraction. That beats the not quite 3% you can get on the Vanguard Long-Term Tax-Exempt Fund.
Or you could buy a fund. Less work, but you’ll lose a quarter of a point or more to fees (offset in some cases by income from securities lending). Another drawback to a fund is that it may throw some non-QDI income your way.
Army Engineers Week
Provided by U.S. Army Corps of Engineers Tuesday, February 19, 2019
What is it?
National Engineers Week, sponsored by the National Society of Professional Engineers, coincides with the birthday of President George Washington -- America's first engineer. This observance calls attention to the contributions that engineers make to society. It is also a time to emphasize the importance of learning math, science, and technical skills.
What are the current and past efforts of the Army?
The Army observes the National Engineers Week Feb 17-23, to honor Army engineers and the work they perform, primarily under the direction of the U.S. Army Corps of Engineers (USACE).
The Army Regimental Engineers Week, celebrating the contributions of the Engineer Regiment, will be observed April 8-12, 2019.
What are the continued efforts planned by the Army?
USACE will continue to:
Army engineers continue to play a crucial role in the growth and welfare of the nation by solving the toughest engineering challenges. With sustainability as a guiding principle, Army engineers work to strengthen the nation's security by building and maintaining America's water resources infrastructure and providing military facilities where service members train, work and live.
Why is this important to the Army?
Army engineers deliver facilities and infrastructure to help maintain readiness and achieve Modernization goals. Army engineers deliver vital engineering solutions, along with the nation's partners, to secure the nation, energize the economy, and reduce risks related to disasters.
Resources:
Related STAND-TO!:
USACE on social media:
Subscribe to STAND-TO! to learn about the U.S. Army initiatives.
No comments:
Post a Comment