Good, Ears, Carrots, and Cards December 15, 2005March 3, 2017 GOOD STUFF Good for Ford. It’s great when people do the right thing – and in this country, standing up against discrimination is the right thing. Good luck to the people of Iraq. As tragically as we’ve blundered (not the fault of our amazing military and troops), may today go well for the long-suffering Iraqis. Good post over at Yahoo finance on NTMD. Don’t sell your puts. Good heavens – it’s Marie’s birthday. Happy birthday, Marie! (Push, Yolanda – push.‘) EAR PLANES Barry Bottger: ‘I swear by ’em. My ears are especially sensitive during takeoff and landing. Before Ear Planes, the landing pain could get so bad and I’d be grimacing so violently that, today, I’d probably be escorted off the plane due to ‘questionable behavior.’ $6.50? A bargain. And available at better drug stores everywhere.’ SWEET CARROTS Russell Bell: ‘The carrots you find in most grocery stores have been bred for size and sturdiness and picked at an advanced age. (‘Baby carrots’ are adult carrots cut down to baby size as a marketing gimmick.) Grow your own carrots, pick them young, and taste how sweet a carrot can be.’ Wkwillis: ‘Carrots are like corn. They are sweet when fresh and rapidly enzyme polymerize the sugar to starch when picked. Corn should be picked after the water to cook them is already boiling. Carrots should be eaten as soon as they have been pulled out of the ground. If you are worried about nematodes, you can wash them first, with the water you are carrying with you. Don’t wait till you get back to the house.’ ☞ I never worried about nematodes before, but I sure will now. As for pulling them out of the ground, where I’m from, we don’t have ground, we have pavement. Dave Budde: ‘Reminds me of the time I went on the Atkins diet. A couple of weeks into it, my girlfriend made some osso buco with carrots. They tasted like candy. Sweetest thing I think I ever ate. The normal American diet is so filled with sugar that you can’t taste the good stuff when it counts.’ CREDIT CARDS Scott Nicol: ‘Credit card minimum payment requirements are on the rise. This is a good thing. But if you have payments made automatically, you might want to check that the payments still cover your minimum payment. Not that you should normally carry credit card debt, but I was almost caught off-guard by MBNA’s minimum payment increase this month. MBNA has been so nice as to lend me, at 0% interest, a healthy sum of money on three separate occasions since 2002. I’ve never paid a dime of interest to them (only $100 in fees, total), but gained more than $2000 in interest as this money was sitting in my bank. Not bad for an hour of work. I think MBNA are slow learners. Repayment is easy, since you can setup recurring payments on their online system. But the system has no option for making a minimum payment, you must specify the amount. Had I not looked at this month’s statement, my scheduled payment would have been far too small, triggering penalties and interest. So check your automatic minimum payments.’
Sweet Carrots December 14, 2005March 3, 2017 HOW TO FEEL RICH You know Ben Stein? Matthew Broderick’s teacher in ‘Ferris Bueller’s Day Off’? (And a well known financial columnist, among other things?) We disagree on a lot, but I sure agree with him on this. It’s a good column to send loved ones this holiday season, especially if you plan on downsizing the largesse. (You got them a wide-screen TV last year, are getting them fluffy socks this year.) HOW TO KEEP YOUR EAR GLANDS FROM BURSTING You have the fluffy socks all packed and ready to go – it’s a fare you locked in months ago – and now you have the kind of winter cold that makes flying . . . landing, to be specific . . . really painful. You get this feeling just behind your ears, like someone is sticking an ice pick into the joint of your jaw and your ear gland (and didn’t they just make it legal again to carry ice picks on planes?). I know there are no such things as ear glands (are there?), but that’s how it feels. There is not enough Dentyne Ice in the world to keep you from breaking into a pain sweat as you approach the runway. OK? So click here. I’ve used them. To my surprise, they seem to work. At $6.50 each, you might even want to get a few extras as fluffy stocking stuffers. (Thanks, Elizabeth!) CARROTS If carrots have as much sugar as everybody says they do, how come they only taste sweet to horses? Is it like dogs being able to hear really high-pitched sounds we can’t? Think about it.
Spaceship Earth December 13, 2005March 3, 2017 We’re losing the planet. Donnie Fowler took notes at Al Gore’s most recent seminar: The 10 hottest years on record have all occurred since 1990 and the worst hurricanes on record are occurring with more frequency than ever before. Animal species worldwide, from birds to amphibians to polar bears, already are exhibiting symptoms of disruption and harm, having dramatic effects on the food chain and the spread of diseases. Coral reefs, a fundamental building block of the oceans’ ecosystem, are becoming bleached from warmer, more acidic ocean water, and are dying at unprecedented rates. Of more than 600 peer-reviewed research publications, not a single one has disputed the view that global warming is real and measurable, but 53% of media stories continue to refer to global warming as an issue that is in dispute. Environmentalist Alan Farago writes in Sunday’s Orlando Sentinel: I am asked, often, “I know what you are opposed to, but what are you for?” How is this for an answer? I am for a sustainable creation. [. . .] In 15 years of watching Florida’s environment — and intensely now, global warming and climate change — even when land purchases, global assurances and hard lines drawn on a map are held as signs of progress, compromise is no match to the threats. And so it was a few weeks ago I hovered with swim fins and face mask above a patch of coral reef in the Caribbean, and in a mood alternating between determination and resignation, what came to mind first, was Jerusalem. As recently as a few years ago, this patch reef would have showed how creation is knit together. That is what Jerusalem does, and reefs, too, the most ecologically diverse places on the planet. But what I found knit nothing. The reef was gray, as though erased, and on closer inspection as if a hammer had blasted what had been elkhorn, staghorn and brain corals to colorless bits. I knew what I was seeing: It is happening off the coast of Florida. As I floated over this rubble — a few wrasse and parrot fish like orphans in a gutted cathedral — I thought to myself: This is what trouble looks like. Not the trouble we endure with work, or to put food on the table, and not even the trouble of life-threatening disease. This trouble speaks of more than we know. You don’t have to swim over a reef to understand this. You don’t even have to be in the Caribbean — it could be Key West. You don’t even have to know how to swim to understand that, as evidence of sustainable creation disappears, our grasp of what needs defending disappears, too. Warming oceans are altering critical components of the food chain faster than species can adapt around the changes. There is evidence that rising sea levels are destroying communities at the polar north, altering the normal flow of ocean currents, and fueling more intense, extreme weather events on land and sea. Around the world, coral reefs are in sharp decline. And within our own bodies, genetic changes from industrial and agricultural pollution are altering the clockspring of life. Billions of people look to Jerusalem as the single place that represents the whole of creation. But I take Jerusalem to be every place where mankind breathes. I take every coral reef in decline to be a place showing how we have pushed nature beyond the capacity of compensatory systems based on knowledge, ingenuity and government. So what am I for? I am for the common wealth of society. I am for our common wealth, the coral reefs, rivers and streams, the Everglades, the clean air and clean water life requires. I am for fair and equitable assessment of costs to growth, so that the road paved with good intentions and concrete made from limestone is not also a six-lane highway to perdition. I am for the coral reef and every action that washes one generation after the next, unguided by human hand. I am for Jerusalem that is, like the coral reef, an edge of a place. Without an edge of a place to penetrate the mystery of creation, we are lost, and Jerusalem is nothing but a city expressing mankind’s most crippling tendencies. So when people ask what I am for, my answer has to do with space and breathing room, and the urgency of returning economic imperatives and false statistics to the lower rungs of the ladder we climb to reach a useful and productive life, measured not by consumption of valuable possessions but by appreciation, respect and caring for the gifts we have been given as caretakers and stewards for future generations. Am I an idealist? I think I am a realist. Life is a cathedral held together by the fragile, thin layer of atmosphere and unique, so far as we can see, in the entire universe. We don’t need any more evidence. Near the surface, we can reach out to creation, but only if it is intact. Alan Farago of Coral Gables, who writes about the environment, can be reached at alanfarago@yahoo.com. With competent leadership, I believe we can do better. Just as a competent team would not have ignored the CIA Director’s January, 2001, warning of a ‘tremendous,’ ‘immediate’ threat to the United States (Bin Laden) . . . or invaded Iraq prepared for the best-case scenario only . . . so a competent team would not have deprofessionalized FEMA – or for five long years scoffed at the threat of global warming.
Good News If You Make $10 Million a Year in Dividends (Plus Free Audio Even If You Don't) December 12, 2005March 3, 2017 A GRAND TIME TO BE RICH AND POWERFUL The Republicans in the House of Representatives last week passed yet another tax cut for the very rich at the expense of more pressing needs – and future generations. In justifying it, they and their surrogates said it was necessary to keep the economy booming – and lauded the previous cuts as having brought the stock market back. Instead, of course, the Dow is now lower than it was when Bush began promising his tax cuts, and the economy is doing well on average – just as, on average, everyone in a homeless shelter is, on average, a multimillionaire when Bill Gates happens to be there visiting – but adjusted for inflation, reports Paul Krugman in The New York Times, median household income has fallen for the fifth year in a row. They neglect to mention that in the wake of the modest Clinton/Gore tax hikes on the best off (but on no one else!), these things happened: the Dow trebled, median incomes steadily rose, poverty steadily fell, and deficits were turned into surpluses. Sure, the 90% top bracket under Eisenhower was nuts, and sure Kennedy’s lowering it to 70% actually increased tax revenue (because it was slightly less crazy to pay the tax rather than risk losing 100% in a nutty tax shelter). And sure, when Reagan cut the top bracket to 50% – still too high – tax revenues again rose, for the same reason. But experience showed that lowering the rate to 28% overshot the mark – we began piling up this mountain of trillions of dollars in Republican debt. (By the time Bush leaves office, if he sticks it out to January 20, 2009, the National Debt will be nearly $10 trillion – of which $8 trillion or so will have been racked up by just three presidents: Reagan, Bush, and Bush.) Meanwhile, experience showed that Clinton’s moving the top rate back up to 39.6% was just about right. Prosperity was steady and our budget began to balance. The final thing to say about this is that if we do need big tax cuts to keep the economy humming, how about giving them to the people who are actually struggling to heat their homes and educate their kids?Why not give a tax break to work instead of wealth? FREE AUDIO My friend Alan Rogowsky points us here – “all this great stuff (JFK’s inaugural, Reagan’s ‘evil empire’ speech etc., etc.) . . . and it’s free!!!” HAPPY BIRTHDAY My dapper stepdad is 93 today. Is that cool or what? Happy birthday, Lew! Tomorrow: Spaceship Earth
Snow Day December 9, 2005March 25, 2012 As a write this, two inches of snow are forecast to fall on Washington. I am not in Washington, but have decided to take a snow day anyway. Why should only the kids up North get these things? Hope to make it up over the weekend.
On the Front Page in Norway . . . December 8, 2005March 3, 2017 TUESDAY TV Jim Batterson: ‘I had such high hopes for ‘Commander in Chief.’ I expected it to be a counterpoint to West Wing, showing another version of an idealized White House but from a different point of view, dealing with national issues from a moral point of view. Instead I have seen a show that is another family soap opera nestled within a White House in which the woman president repeatedly shows her ‘tough’ side by using military threats or action against other countries or by bullying her political opponents or even allies. The show is almost unwatchable. ☞ I guess this is why God invented more than one network. John Skogstrom: ‘It’s a terrible night in that there’s just too much worth watching. My wife and I go for ‘House’ at 9 on Fox. It may be too formulaic to be a great show, but it’s an all-time great character. ‘Earl’ is a great show and character, but I guess I’ll take an hour of near-greatness over a half of greatness. It’s a tough call, though, since ‘The Office,’ which follows Earl, is good with a great character or two, especially Steve Carrell.’ ☞ I guess this is why God invented TiVo. (Full disclosure for those who missed yesterday: I own a few shares of the stock.) And why you need more than one. Charlie Mac: ‘As a huge fan of Jon Stewart’s ‘The Daily Show,’ be sure you also watch ‘The Colbert Report’ afterwards. It is such a dead-on parody of Bill O’Reilly’s show that I’m amazed O’Reilly hasn’t sued yet. In my time zone, both O’Reilly and Colbert are on at the same time, so my wife and I flip to O’Reilly during the commercials and it’s hilarious to see the similar graphics and hear that pompous voice. Colbert’s guests have been some really amazing people, and they seem to get the joke that they will be talked over and interrupted by a preening jackass.’ NEWSPAPERS FROM AROUND THE WORLD The way they really look (and zoomable for tired eyeballs). Thanks, Alan! Click here and take the rest of the day off to peruse 225 papers.
TEEVEE, TIVO, N-T-M-D, HO, HO December 7, 2005March 3, 2017 DECEMBER 7 Pearl Harbor was attacked 64 years ago today. Less than four years later (August 15, 1945), from pretty much a standing start, we had defeated the giant Nazi and Japanese war machines and had become, for a few short years, the world’s only superpower. On September 11, 2001, we were attacked again and by the next day had the goodwill of virtually the whole world on our side. More than four years later (December 7, 2005), we have played into the hands of our attacker, increased the ranks of our enemy, and stretched our military dangerously thin. The main thing is to figure out what to do now – John Murtha and others are offering alternatives. Even so, the feeling still eats away at me that (see, too, yesterday‘s ‘grading’ of our homeland security) this all could have been done so much better. TEEVEE, TEEVO, IT’S OFF TO WORK I GO N-T-M-D, N-T-M-D . . . TEEVEE, TEEVEE, TEEVEE, TEEVO Craig Gawel: ”My name Is Earl’ is moving to Thursday.’ ☞ And I accidentally switched Jon Stewart’s timeslot with Nightline’s yesterday. Sloppy! But you see, with TiVo, one need not remember any of this. It keeps track for you. I even bought back a few TiVo shares at $5.15 last month. I didn’t tell you because (a) what do I know about TiVo that you and the rest of Wall Street don’t know? And (b) the company certainly faces a lot of challenges. But TiVo has become such a brand name, with such an affectionate following, it wouldn’t amaze me to see some big player pay $1 billion for it – a double. When I compare TiVo’s market cap with that of Nitromed, say (the two were almost identically valued when I bought my TiVo shares), I just have to think TiVo is the more interesting speculation. One has a pill that combines two generics for the slight added convenience of a few thousand patients; the other has a few million people completely dependent on it for their continued happiness and well-being (well, if not millions, at least me), and at about a tenth the cost. Speaking of which, Nitromed was down $1.08 yesterday to $14.12 on volume of 2.3 million shares, which means that those of you who bought puts in July, with the stock at $22, should be deep into the money. But what should you do now? One small investor on a message board asked today: > Davo3795: How low will it go before the shorts cover? Any guesses? To which another poster, whose annoying writing style sounds so much like mine that I’d swear it was me (but who can tell? no one uses their real names on these boards) replied: > Buydil: Well, some shorts probably are covering today – I can’t imagine a lot of other people rushing in to buy 2 million shares. But why do you assume shorts want to cover and trigger a taxable event? The best scenario for shorts is NEVER to cover. To have the stock fall close to zero . . . as so many well-meaning start-ups do . . . yet never become entirely worthless (which the IRS views the same as a sale, thus triggering the tax). The value proposition of this company is, in essence, instead of “take two aspirin and call me in the morning,” take ONE, which is undeniably more convenient — but at six times the price, an extra $2,000 or so a year. The longs feel that’s insignificant, because the taxpayer and insured population will absorb most of the cost, not the patient, who merely pays a co-pay. But remember: this pill is not for ALL black congestive heart failure sufferers, just for some subset of the 20% or so sufficiently far along to need it. And many of them are *already* on the generic combo. And most are *already* taking a great many pills each day, so that switching to BiDil wouldn’t cut their pill-taking in half, but maybe from 20 pills a day to 17 or something like that. An improvement, certainly, but maybe not worth $2,000 extra a year. Remember, the BiDil label calls for TWO BiDil three times a day (6 pills) with each two totaling a dose of 20 mg isordil and 75 mg hydralazine. That dosage can be EXACTLY matched by one 20 mg isordil, one 50 mg hydralazine and one 25 mg hydralazine. So, assuming the doc wants to prescribe the precise same dosage for every patient regardless of the specific situation (which I doubt, but that’s the longs’ view), one way to get 75/20 is with 2 pills, the BiDil way ($2,500 or so a year); the other is with 3 pills, the generic way ($500 or so). The current prescription rate for BiDil does not suggest that this incredible medical breakthru (forgive the sarcasm) is catching fire. So, as usual . . . there are no guarantees, but if you went into this with money you could truly afford to lose: don’t sell your puts. Even at $14, the company is still valued at more than $400 million. That’s a lot to pay for a small company with a single product losing several million dollars a month.
Grades December 6, 2005January 16, 2017 How many centuries ago was it that my life revolved almost entirely around grades? I was not one of those students who was in it for the learning, I was in it for the grades. (If school had paid better, I might have been in it for the money.) This is a shameful thing to admit, and despicable, but it was a competitive high school (‘whadjaget?’ was our version of today’s ‘wassup?’) – and it leads nicely into today’s topic: Grades. TERROR The 9/11 Commission, headed by former Republican New Jersey Governor Tom Kean, graded the government’s progress on the 41 recommendations in its initial report – including 5 F’s, 12 D’s, 9 C’s, and 2 incompletes. ‘I think we’ve too quickly forgotten the lesson of 9/11 and I think the odds are very good that we’re going to pay a terrible price for forgetting that lesson,’ said Republican ex-commissioner James Thompson, a former Illinois governor. ☞ This is a big deal, it seems to me. Imagine if our leadership had gotten 5 F’s, 12 D’s, 9 C’s and 2 incompletes among their 41 grades in the conduct of World War II. AIDS Thursday was World AIDS Day, calling attention to a disease from which – on every day – 8,500 people die and with whose underlying virus 13,500 are be infected. By some lights, our approach to the pandemic seems to be undermining the world’s approach. (But we’re pouring a fortune into ‘abstinence before marriage.’ That should do the trick.) Meanwhile, the Human Rights Campaign issued its second annual World AIDS Day report card, grading the U.S. government’s performance across four criteria: Prevention, Care & Treatment, Research, and Global AIDS. Last year’s grades were F, D, C and C. This year, according to HRC, we slipped a bit: F, F, D, and C. WHEN ALL THE WORLD IS A HOPELESS JUMBLE . . . Enough with the gloom. Take a hike! Cook some soup! See a show! Learn to whistle! Or at least treat yourself to ‘Commander In Chief’ followed by ‘Boston Legal’ tonight on ABC. Richard Stanford: ‘While you’re talking Broadway [I recommended three shows last month], I’ve been amazed at how many people don’t know about cancellation tickets and will pay outrageous amounts of money trying to get good seats. If you’re willing to risk rejection (hasn’t happened to me yet), you can just show up an hour or so before the show and pay face value for cancelled tickets. We’re probably averaging 8th row center for shows we’ve done that way (and a lot worse for shows we’ve bought normally or through our hotel). No service charges, either.’ ☞ Or save $220 on the pair of tickets and get someone to tape My Name Is Earl, which – tragically – conflicts with Commander In Chief (NBC Tuesday’s at 9pm) and watch it after Boston Legal, Jon Stewart, and Nightline conclude. What a night! Indeed, spend that saved $220 on a second TiVo, so you can watch it all (and in 75% the time). You may never have to leave your house again.
Market Timing December 5, 2005March 3, 2017 SO MANY GOOD MOVIES! If you love movies, here‘s an enjoyable site to help handicap the Oscars – and decide which films to see. ILA, CTON, CSPLF Doug Gary: ‘I wonder if you might update us on holdings I don’t recall you mentioning for a while: ILA, CTON, CSPLF.’ ☞ I still hold these, though without a great deal of conviction. CTON is just the stub from what you may recall was a nice little pay-off, so I haven’t paid attention to it. Given that they are in the home building business, I should probably sell. Then again, the family that runs this teeny tiny company strikes me as smart and resourceful, so I just hang on. The other two, ILA and CSPLF, are somewhat more substantial speculations, but no one should have money in them they cannot afford to lose. I’m disappointed neither has paid off; not sure if either will. A TIME FOR CAUTION? If I remember right, Warren Buffett is sitting on something like $43 billion in cash. If he can’t find good things to invest in at today’s prices, it gives me pause to think we can. This is one reason that I have about a quarter of my tax-sheltered retirement plan in 20- and 27-year TIPS (Treasury Inflation Protected Securities) that guarantee 2% above inflation . . . why I have something less than $43 billion but more than $43 hundred in cash . . . why I like my shares in PCL (I figure that, whatever happens to the stock short-term, the trees will keep growing) . . . and why I sleep okay with wildly speculative things like BOREF and the NTMD puts. Both could go to zero (really!), but certainly not because of any financial meltdown, in case we were to have one someday. In a financial meltdown, our NTMD puts would do brilliantly (if they had not already expired); and while BOREF shares might fall by 90% or 95% (on volume of 1200 shares, no doubt), it wouldn’t affect the value of the company’s underlying technology (whatever that value may or may not ultimately prove to be). James Karn: ‘Why am I bearish? Mr. Crabbe pretty much sums it up: ‘The only U.S.-produced items that I can think of that exist in large quantities in China are dollar bills,’ said Matthew Crabbe, the managing director of Access Asia Ltd., a market research firm.” ☞ I’m bearish because I think both consumers and the government have gotten too heavily in debt, and that a decline in home prices could get ugly. (And because we have three years, one month, and fifteen days to wait to get a better CEO, even though a majority of the shareholders would like to fire him now.) Then again, it is notoriously difficult to time the market. So if especially if you’re young, with a steady program of investing – keep it up! MEANWHILE, DOWN AT THE CIA This from the Washington Post last month gives one the sense of how we’re fighting terrorists – and in a much smarter way than by attacking Iraq. George Tenet seems to have had his good points.
One Republican’s Thoughts December 2, 2005March 3, 2017 “….It really depends upon how our nation conducts itself in foreign policy. If we’re an arrogant nation, they’ll resent us…..but if we’re a humble nation they’ll respect us.” – George W. Bush, October 11, 2000 No, not that Republican’s thoughts. This one’s. If you’re an open-minded Republican, he’s speaking directly to you.