Sex and the CFL June 29, 2007March 6, 2017 SiCKO! Michael Moore’s SiCKO opens today. Run don’t walk. And let us know what you think. POWER STRIPS AND SURGES Emerson Schwartzkopf: ‘Cutting out a power conditioner is OK if you have a weekend house and the most important electronic devices might be a TV and DVD player. For people using their computers at home on a regular basis, having that conditioner in areas of less-than-standard electrical service isn’t really an option. Prolonged variation of the voltage can take a toll on equipment. And it’s not only a rural problem. I once spent an enlightening afternoon watching a multimeter reading of a previous home’s outlets. I reported the data to the local power company, which then tested area power lines and spent a few days replacing transmission equipment that one workman described as, ‘just about completely fried.’ Also, be aware that not all powerstrips are created equal when it comes to protecting any electronic equipment. I’ve had personal experience with strips that claimed excellent ‘surge protection’ and failed on the job. To get strips that actually work, you really need to step up in quality from the usual discount-store variety; several companies that make uninterruptable power supplies (UPSs) also make some pretty tough powerstrips. I’d never operate my desktop computer without a UPS, incidentally, even though it does consume more power than using a plain powerstrip. The energy cost to replace a fried computer in materials, manufacturing, transportation, etc. (not to mention the human power drain on my sanity), is far greater than the daily consumption of that little box that protects my equipment and my ability to do business.’ THE POT IS BOILING No, Mr. Smarty Pants, it’s the water that’s boiling. Which brings us to: David D.: ‘Alison refers to ‘The tankless hot water heater we bought was from Seisco.’ My question – why is a ‘hot’ water heater needed at all? I mean . . . if the water is hot already, why heat it?’ TRYING TO BE AT LEAST SOMEWHAT RESPONSIBLE Dave: ‘Everyone could conserve more. Despite the fact that I count myself as a conservationist, I too, have two homes. A smallish primary residence (1800 sqf, exactly at the median $ for our metro community), and a very small (700 sqf) second home. Yes, I could consume less, but I think there is more to life than that. So, we (and Alison) are doing what we can while still enjoying this too-short time we have. I, for example, just went solar on my (small) boat, I bought an electric lawn mower (savings that really surprised me, I should post more details separately on that alone), and we always take the most fuel efficient vehicle for the trip (the van when the whole family makes the trip, the car when we can fit in it). Not much, but as you say, I’m making an effort.’ TOO MANY PEOPLE Bill: ‘I remember you being on the board of Zero Population Growth . . . are you still? You may be interested in this article. All the things I remember you saying in the past are here. How can one go about getting involved in ZPG?’ The statistics are quite remarkable. For most of the two million years of human history, the population was less than a quarter of a million. The advent of agriculture led to a sustained increase, but it took thousands of years, until 1800, before the planet was host to a billion humans. Since then growth has accelerated – we hit 2 billion in 1930 . . . 4 billion in 1975 . . . 6 billion in 1999. Today’s grand total is estimated to be 6.5 billion, with a growth rate of 80 million each year. ☞ ZPG is now called the Population Connection, and although I’m long gone from the board, it’s definitely worth your consideration. We may well learn to sustain tens of billions of people on our planet and beyond – someday. But can we get to someday? Right now, we seem to be fouling our nest faster than we’re learning to clean it up. Not only have we added 4 billion people to the planet since I was born – which is a lot more people to fit into the one and only Yellowstone National Park or to visit the one and only Leaning Tower of Pisa (I put them on a par. It LEANS!) – we have also seen their consumption per capita soar, not to mention their toxic and nonbiodegradeable waste. And the fish are fewer (and more mercury laden) and the bee population has fallen off a cliff. Our lightbulbs should be CFLs and our next vehicle should get dramatically more mileage than our last. SOMEDAY – SHMUMDAY Stewart Dean: ‘You say, ‘Don’t rule out technological advances that lead to abundant clean energy . . . that in turn makes possible unheard of sustainable prosperity. It’s just that ‘getting from here to there,’ in the meantime, could be a bit of a problem.’ A new Fact of Reality, ranking with There is No Such Thing As a Free Lunch, that everyone needs to realize is that even if there were free energy, we would cook the planet in short order. Using energy ends up generating heat…which then builds up. One of the most direct learning experiences for me has been in the server room for my small college: I learned that you have to pay for energy twice. Once when you supply it to the computer, the second time after the electricity has electricked and is now heat….and you have to pay (the second time) for the air conditioning to remove it. More computers = more heat = more air conditioning. It doesn’t matter whether you use electricity for computing or making toast; It Ends Up As Heat. A computer uses 100 watt, a toaster 1000, but 10 PCs throw off the same amount as a toaster…and they run constantly. So. You have free energy… you’re still heating up the planet. It’s like having a house, but no way to remove the garbage.’ ☞ Fireflies. Cold light. Cold fusion. Sang-froid. You just never know. But I take your point. CFLs AND YOUR WILD SEX LIFE Stewart Dean: ‘CFLs in bedlamps are a bad idea. For whatever reason, activity in and around the bed can be physical, wild and unconsidered. I first encountered this when my 14 year old jumped me when I was lying down. That was 5 years ago and I had pieces of glass from the reflector incandescent in the bed. I did NOT go to a CFL since they are even more fragile and they have mercury as well as glass in their makeup. Instead, I have LED ‘light bulbs’ in the headboard clip lights. They are much more durable and just about impossible to break.’ ☞ This is crazy talk. Beds are for sleeping, the most restful place in the house. (And from their heft, I would think the CFL glass is actually thicker than that of the incandescents, but now I’m way out of my depth.) SiCKO! Michael Moore’s SiCKO opens today. Run don’t walk. And let us know what you think.
Ask Not Watt Your Country Can Do for You Ask Watt You Can Do for Your Country June 28, 2007March 6, 2017 ‘MY CHIEF POLITICAL CONSULTANT WILL BE MY CONSCIENCE’ Here is Ted Sorenson’s ‘dream’ speech for the Democrat accepting his or her Party’s nomination in Denver August 28, 2008. ALISON ON ALISON You will recall that a few simple changes are saving Alison and her husband about $800 a year, or 45% of their Connecticut electric bill. Some of you were outraged that they have two homes; others were pleased they’ve cut their usage nearly in half. I asked her to elaborate on some of her choices and their costs: Why Powerstrips? It’s a whole lot easier to flip one switch (usually with your foot) than to physically unplug the TV etc., which is the only other way to stop it from drawing power. CFLs? They’re more expensive, of course, but Connecticut has subsidized them heavily (and Costco and Walmart sell them). Not all CFL’s are created equal. The thing I care most about is the color of the light (the old CFL’s made everything look horrible). ED has good info on their website here. Water Heater The tankless hot water heater we bought was from Seisco. It cost about $700, but we get a couple hundred dollars off our taxes because of its energy efficiency, and there’s no sales tax on it in CT. It sits in the basement and actually takes much less space than our old one, as there’s no holding tank. Only downside: water flow is more limited, so we can’t all take showers at once, BUT it never runs out, so being the last one to shower doesn’t mean you’ll freeze. That seems like a good trade. My husband says that if we could have, we’d have used a more-efficient propane model (would require a major amount of work in our existing house), and that Bosch makes the best of those. Washing Machine The washing machine is LG. If I remember correctly it was about $800 but there was a $150 rebate, again for energy efficiency. As a side benefit, it cleans better and more gently than the top-loader, and uses much less detergent. Power Conditioner We also removed a power conditioner, a big power drain that used to keep our rural end-of-the-line electric current from spiking and dropping wildly (bad for electronics). Now that everything’s on power strips, that’s less of a concern. ☞ It would be a drastic change to ask people to give up their second homes. But asking them to cut their energy consumption in half? Little or no sacrifice is involved; indeed, it’s a good investment.
WiFi Make You Itch? June 27, 2007January 6, 2017 A CAUSE TO BELIEVE IN According to this, calls and emails to Congress are running five to one against expanding the federal hate crimes law to include hate crimes against gays and the disabled. The bill passed the House; but opponents – bursting with good intentions – are hoping to stop it in the Senate. Lest you think these fine people are going at the problem with a blunderbuss, they are not mounting a campaign to repeal the existing hate crimes statute; just fighting to keep from expanding it. Isn’t it great to know that, with all the other things that need doing, people find the time to oppose inclusion of people like Matthew Shepard, beaten to death for being gay, after whom the bill was named? EASY! You’ve probably done this by now, but I continue to replace incandescents with CFLs and I realize that here in my office, which I used to use 400 watts to light, I now do fine with 58. No sacrifice whatever. The bedroom is now frequently bathed in nothing more than 9-watt reading lights (equivalent, the package claims, to 50-watt incandescents) shining down over each of two pillows – more than enough to illuminate a book 30 inches below or to keep us from banging into things as we navigate the room. That’s 18 watts total, where before we’d typically use 200 or more. Which brings us back to our good friend . . . ALISON, AGAIN Carl: ‘Re: Dennis and Kevin on Alison – Geez guys, give her a break! Here comes someone with a positive message. Instead of the support and encouragement that we should give her, we slam her! Get a grip, guys.’ Allen Jones: ‘Such irrelevant, jealous meanderings! Yes, Alison has excess money and thusly owns a second home in Connecticut. That point is really moot. Alison is STILL doing her part. It really isn’t ours to judge the reason for this second home, it’s only Allison’s business. Kudos to Alison for explaining how simple it can be to cut energy usage in ANY home, first, second, or twentieth.’ Cynthia LaLuna: ”Green’ building techniques and research are often funded by the well-to-do until they can be scaled up, and priced down, for the mass market. Without such well-off explorers, we would not have green corporate buildings or residences going up all over this country – or be developing lower-cost, mass-market versions.’ Linda Tam: ‘I was surprised no one who wrote about Alison asked how much electricity she was saving? Sure she is saving 45% on her BILL, but I expect her power savings (and therefore her planet-saving environmental kudos) were less because of utility baseline allowances. At least with my utility bill in California, billing is progressive and that last kilowatt-hour each month costs more than the first.’ Christina O’Sullivan: ‘Have you seen carbonfootprint.com? Tell me at least you’ve gone to climatecrisis.net/takeaction/carboncalculator. I bet many of us unwashed masses have a carbon footprint smaller than Alison’s household. Unfortunately, if everyone in the world lived the way I lived, expending 3.9 tons per year, we’d need 2.3 planets to hold all of us.’ THE REAL REASON TO TURN OFF ELECTRONICS Bill Bruno: ‘Saving energy is a worthy goal, but saving your health is arguably more important. I’ve discovered the hard way about electrical sensitivity. Not only are those electronics using energy, they are also generating impressive magnetic fields and in many cases microwave radiation (even when ‘off’ or in stand-by). I’m a Ph.D. physicist, and I’ve measured these fields. It is thought that exposure to such fields (especially if you live near a cell phone tower – and these days who doesn’t) leads to the sensitivity. Here‘s a link on how one can survive this condition, but believe me it’s not pleasant. So turn off your cell phone, unplug your wireless router and anything near your bed. Use surge protectors and turn them off when not in use!’ SiCKO! Michael Moore’s SiCKO opens Friday. Run don’t walk. At the screening I attended, 1500 people were on their feet cheering through the entire credits.
Can Openers June 26, 2007March 6, 2017 GLDD So the stock got up above $10 last week, which put the warrants briefly at $5.16. But now, I imagine, an awful lot of people are – understandably – choosing to sell or exercise their warrants rather than come up with cash by the July 19 conversion deadline. (If someone bought 10,000 warrants at 40 cents each, that was $4,000. Exercising them at $5 each would require sending their broker $50,000. Many will prefer to take their profit and run.) As a result, you have what may be an interesting tug of two conflicting forces . . . and a different opportunity may loom. Tugging in one direction is the weight of all this warrant-exercising. The warrants are exercised and then, a lot of the time, the shares are immediately sold. Selling drives down the price of the stock. (Even if you sell, rather than exercise, your warrants, chances are you’re selling them to a market-maker who exercises them and sells the stock himself. I assume this is why the warrants now sell for a nickel below their intrinsic value. Basically, you give up that nickel for the convenience of having someone else worry about exercising the warrants. That someone else, if he does this for five million warrants, makes five million nickels without any appreciable risk, and even on Wall Street, every $250,000 helps.) Tugging in the other direction, I like to think, may be a mutual fund manager or two who see this old-line dredging company as an attractive long-term holding in which they’d like to acquire a few million shares. So they are thinking to themselves (maybe), ‘we are looking for this stock to be $15 in a year or two, and don’t want to miss the chance to buy it . . . but with all this warrant-exercising, if we play our cards right, we may be able to buy it cheaper between now and July 19.’ And we who own the warrants are thinking to ourselves (maybe), ‘we have to sell by July 19, but what’s the best time? Will the stock just go down, down, down until July 19 and then snap back on the 20th?’ And the fund manager may be thinking, ‘yeah, when the selling stops on the 19th, the price will snap back, so I’d better buy it on or before the 19th.’ And the other fund manager may be thinking, ‘if another fund manager might be buying before the 19th, I’d better buy before the 18th and beat him to it.’ So the first institutional investor may be thinking, ‘I don’t want to be beat to it, I think I’d better just try to buy 100,000 shares a day whenever it’s under $10.’ So you and I may be thinking, ‘don’t rush to sell as the price drops . . . it could well snap back by July 19th . . . unless everybody else thinks so, and it crashes on the 19th because so many people waited til that day to exercise and sell.’ So the fund manager may be thinking . . . And so it goes. But my point is that it might not be imprudent for someone who can afford to invest in stocks to place a standing order to buy shares at $7.50 or $8, on the chance that, at sometime between now and July 19, as this dance continues, you get some. Of course, even if you do, it could just keep falling. Stocks are risky. But my guess is that it’s more likely to be $10 or $15 than $4 or $5 a year or two from now, so snagging some at $8 could make for a nice investment. CAN OPENERS Stephen Gilbert: ‘Swing-A-Way? The world’s best can opener is the Rosle. It cuts through the weld (or whatever) that holds the top to the can, leaving no sharp edges, and accumulating no gook on itself. This is the Berkshire Hathaway (circa 1984, when I bought it) of can openers.’ Mike Maughan: ‘Huh? When you cook like a guy, you don’t use a swingaway. You by God use the P-38 on your key ring. What’s a P-38? Try this link.’ PAUL POTTS Nicholas Altenbernd: ‘Paul Potts wins! And here’s the finale.’ ONE Watch the video (Matt Damon! Bono! Bill Frist!) and consider signing up. It’s free. SiCKO! Michael Moore’s SiCKO opens Friday. Run don’t walk. This movie is going to be huge – and have a huge impact. At the screening I attended, 1500 people were on their feet cheering through the entire credits.
I’m Back June 25, 2007March 6, 2017 DINNER Dave Neal: ‘You wrote: ‘We have 250 people coming for dinner.’ So what’s so hard about opening 250 cans? You do have a Swing-A-Way, no?’ ☞ The dinner was good. The theme was COME WRITE HISTORY – AGAIN (let’s repeat in 2008 our success of 2006), so we had some best-selling writers join Governor Dean, and I brought a six-foot pencil I acquired in the Seventies from a store that specialized in Very Large Things. We began with salad ‘as green as WALT WHITMAN’S LEAVES OF GRASS,’ followed by an entree ‘as historic as GREAT-PLAINS-ROAMING PIT-ROASTED BUFFALO STEAK’ (but we had filet of beef, with vegetarian available on request), followed by dessert ‘as American as APPLE PIE with STEPHEN COLBERT’S AMERICONE DREAM.’ (‘A decadent melting pot of vanilla ice cream with fudge-covered waffle cone pieces and a caramel swirl. It’s the sweet taste of liberty in your mouth.’) All this served by the light of a minimum of 270 electoral votive candles. Cooking Like a Guy™ this was not. (We even served wine, which is why I forgot to post a comment Friday.) SEATING PLANS Karen: “This tool is too late for your dinner – but next time.” ☞ Hmmm. The beauty of Excel is that I already have it and know how to use it (more or less). But I can see how this could be useful. HIDDEN TALENT Mark Lutton: “That British amateur tenor is great, but take a look at these amateur pianists at the Boston International Piano Competition for Exceptional Amateurs – Christopher Shih, a doctor, and Rupert Egerton-Smith, a management consultant.” MORE HIDDEN TALENT Watch this video if painting rather than piano turns you on, and if you have five minutes for a nice little surprise. (Thanks, Sid and Diane.) WAIT! STOP! DON’T DO THIS! Kevin Clark: “I have a large short term gain on the GLDD warrants and, as you point out, no way to wait for it to go long term without ponying up more money. But if I donate them to my Fidelity Gift Trust account don’t I get to deduct the full value? Seems like a better option than donating appreciated assets that are long term.” ☞ No! If you have not held the appreciated securities for a year and a day when you donate them, you get to deduct only the cost of your gift, not the market value – in this case, perhaps one-seventh as much. “Also, if I have a short term gain on GLDDW and a long term loss on some other position, how would those interact on my tax return?” ☞ If you had no other gains or losses, your short-term gain would be reduced by your long-term loss. Click here for more. REMINDER: DO NOT CALL Suddenly, the unsolicited sales calls seem to be exploding. If this is happening to you – or even if it isn’t – take a minute here to register, or re-register, your numbers . . . not least because it was probably four years ago that you last did this, and the repellent lasts only five. So it’s just about time to spray yourself again anyway.
Isn’t Life Wonderful? June 21, 2007March 6, 2017 We have 250 people coming for dinner tonight (cook, Charles, cook!), so I’m writing a seating chart instead of a column. But never fear . . . this clip is better than anything I could have written anyway. TALENT CONTEST VIDEO Peter: ‘Click here. Isn’t the world (still) wonderful?’ ☞ Indeed it is. As is the follow-up. (Oh, okay, I cannot tell I lie. Charles is a great cook but he’s not crazy. The ‘we’ here is the DNC. But I still have to do the seating chart.)
Alison – At Last June 20, 2007January 6, 2017 ALISON GOES GREEN; YOU GO PURPLE Dennis: ‘I am so glad that Alison and her bottom-line admiring husband are able to save all of that money becoming environmentalists. I would like to be well-off as much as the next person but my God, I hope I don’t become such a sanctimonious hypocrite. Please spare us. If you want to help do something nice for the environment, why not cut down to just one 3500 square foot home for your family of 3.7 people.’ Dennis a Minute Later: ‘Sorry about the previous e-mail regarding Alison’s energy saving techniques. [Well, I did think it was a little harsh.] That first e-mail does not even begin to display my absolute disgust over such self-aggrandizement with regards to their conspicuous consumption. [Oops.] There are many ways for you to entertain your readers with energy saving hints and cost saving measures which are both economical and helpful to the environment. Publishing Alison’s e-mail or letter was not one of them. [Oops, oops.] I just know you are going to write back and say well at least she is making an effort and if you do I will vote for The Republican candidate (whichever idiot it might be) as sure as I am sitting here. You are supposed to be a Democrat for God’s sake.’ ☞ Well at least Alison is making an effort. (But just because I’m a bad Democrat is no reason for you to be one – vote Democrat!) Karen: ‘Good for Alison. What did she do with the old water heater and the old washing machine? What’s the payoff on the improvements, at a $200 reduction over three months? Those in-line water heaters are $$$, and troublesome. And what would she have saved if she strung some washlines across the deck and quit using her dryer completely? Or learned to live without air conditioning or raised the thermostat to 80? (Does it GET as high as 80 in Connecticut?) Sorry; just not that impressed when people who have tons of money (weekend house in CT = QED) spend it to save it.’ ☞ Still, if everyone cut his or her energy consumption by 45%, however wasteful the baseline – indeed, if only energy hogs cut their consumption by 45% – it would be a good start. The good news is that for many people, it would entail little inconvenience, let alone sacrifice. What’s the real sacrifice in driving a car that gets 35 mpg instead of 24mpg – a 46% saving? (Or, soon, one that gets 60 or 80 mpg?) Kevin: ‘You may want to re-think putting out messages like Alison’s. I know your goal is to change hearts and minds, and you’re usually good at it, but it’s much less effective when you use a lightning rod to do it. Alison has TWO houses and professes to be an environmentalist? A true environmentalist would solve the energy problem and the carbon footprint by simply selling one house. Or donating it to the Sierra Club.’ Carl: ‘Conservation . . . agree that it’s necessary and inevitable, but the changes made are subject to diminishing marginal returns; meanwhile, total electrical use continues to increase exponentially (see here). We live on a sphere, with finite resources. Eventually, our growth-based system will have to stop. Every day we don’t honestly address this will lead to a harder crash some time in the future. For an excellent book which addresses these concerns and much more, try The Upside of Down, Thomas Homer-Dixon.’ ☞ Don’t rule out technological advances that lead to abundant clean energy . . . that in turn makes possible unheard of sustainable prosperity. It’s just that ‘getting from here to there,’ in the meantime, could be a bit of a problem. As to diminishing marginal returns, I think the average family or business has a long way to go before it runs out of ways to become substantially more energy efficient. Charles McChensey: ‘Quite an interesting [account by Alison] re: saving energy. It would be interesting to do a calculation showing the economic value of the savings. I.e., assuming some rate of return for the capital to be invested, what is the payback period for the dollars of energy savings vs. the dollars of invested capital. Front loader washers are in the $1000-1500 range, on demand hot water heaters around $1000 with installation. (CFLs and power strips are probably a negligible investment.) It seems to me that unless one of the major expense appliances fails, replacing a good working appliance for energy efficiency alone is a ‘feel good,’ but not a sound economic decision. Perhaps you can post your thoughts.’ ☞ To fully analyze this, you’d have to know how long the replaced appliance might have lasted; whether it will be junked or find a new home; what it will cost, in cash and ‘externalities,’ to junk it; how energy prices will rise in the future . . . and a few other things. But if Alison is saving $200 a quarter, $800 a year, and it cost her $2,400 to do it (say), payback is in three years. Over the ten-year (say) life of the appliances, especially with likely rising energy prices, the saving could work out to an internal rate of return exceeding 50% a year. Tax-free, because Uncle Sam doesn’t tax you on your energy savings. Plus whatever good you’re doing the environment. Plus the psychic benefits and the economic signals it sends to the makers and installers of more efficient appliances. (Signals that say: we demand energy efficiency.) Anonymous: ‘Now I’m feeling bad about yelling at my spouse for leaving lights on in the house, especially the bathroom. Our electric bill for March – May is only $75.’ ☞ That’s astoundingly low – but keep yelling at him. If you could cut your bill by $10 a quarter, you could lower your carbon footprint and buy 4 mosquito nets a year . . . It’s one thing to go without instant-on TV, which entails a (small) level of sacrifice. But what sacrifice is there in not having the bathroom lit when you’re not in it? Or having the TV off (well, mostly off) when you’re not watching it? Or the instant-on feature shut off if you go away for the summer? Bob Fyfe: ‘Alison and her husband have done an outstanding job in cutting both their electric bill and electric usage and are to be commended. If Alison wants to take the next step, she can sign up to receive all of her electricity from renewable sources (wind and low-impact hydro). Simply click here. This company sells, at a small premium (1.1 cents/kWh), electricity from renewable sources. I estimate that Alison would spend an additional $20 per three month period to purchase 100% renewable energy. This turns out to be less than 10% of the savings that she has seen by reducing her usage. By saving 40% instead of 45%, Alison would completely eliminate all greenhouse gas emissions from her electric usage at her weekend home. (Note: I estimated 600kWH of electric usage per month. Multiplied by 1.1 cents/kWh, this gives $6.60 per month or roughly $20 every three months. The actual amount will vary but this is certainly in the right ballpark.) Stephen Gilbert: ‘Power Saving Hints for Yuppies.’ ☞ Fascinating! E.g., ‘The Department of Energy estimates that in the average home, 40 percent of all electricity used to power home electronics is consumed while the products are turned off.’ And: ‘Tweaking can pay off. Annually, my desktop PC is now using 73 percent less energy – saving me $119 a year and depriving the earth of 1,405 more pounds of CO2.’
People’s Stories About Their Health Insurance June 19, 2007January 6, 2017 SiCKO! I got to see Michael Moore’s new movie, SiCKO, last night, which opens a week from Friday. Run don’t walk. This movie is going to be huge – and have a huge impact. At the screening I attended, 1500 people were on their feet cheering through the entire credits. GLDD WARRANT REDEMPTION This one has worked out well. If you paid 70 cents for ALBA (now GLDD) warrants at the end of April, 2006, you are sitting on a nearly 7-fold long-term capital gain. It’s probably time to sell much or all of it in the next few weeks (read on). If you bought more August 4, at 36 cents, the gain is 13-fold – but still short term. Should you wait until it goes long-term in August? Well, you can’t. The company has announced it is redeeming the warrants no later than July 19. That gives you two basic choices: sell between now and then (even after ordinary income tax at the top bracket, it’s close to a 9-fold gain); or pony up $5 a share to exercise the warrants (and start the year-and-day long-term holding period ticking all over again). If you happen to be rich, especially if the alternative would be to pay short-term capital gains, I’d pony up the $5 a share, exercise the warrants, and wait a year or two or three, hoping to sell at $12 or $15 or something like that. If things go badly – well, you’re rich. Who cares? But if the plot plays out as it may, with dredging appropriations restored to historic levels, leading to more work at higher margins, then you will have paid $5.36 (the 36 cents you paid for the warrant plus the $5 you kicked in to exercise it) for what might be a $12 or $15 stock. No ‘nine-fold gain, that,’ of course; but still not bad. Indeed, if the stock stayed where it is for a year a day from the time you acquired it by exercising your warrant, you would have ‘made’ the same absolute gain ($4.32, based on last night’s close), but by paying 15% long-term capital gains instead of 35% short-term, say, you would have made about a 10% after tax return by tying up the extra $5 along with the $3.17 after-tax bird in the hand you left in the bush. If you’re not rich, just grab most or all the gain, maybe exercising a little just to keep enjoying your association with this lovely little investment. (I’m a little rich, so I plan to sell what remains of the warrants I have that have gone long-term, as well as some of the warrants that will still be short-term, exercising the rest. How many? Well, not so many I’d be too overweighted in this one stock.) Hugh: ‘I’m just a truck driver but right now I’m sitting on over $80,000 gain on GLDDW.’ ☞ Music to my ears. BOREALIS From an Advanced Explorations press release: TORONTO, ONTARIO–(Marketwire – June 14, 2007) – Advanced Explorations Inc. (the “Company” or “AEI”) (TSX VENTURE: AXI) is pleased to announce that the Company has completed establishment of a 40 man exploration camp on the Roche Bay, Nunavut iron ore project. The Company has mobilized two drills to site and the contractor (Boart Longyear) is expected to have the first drill coring by the end of this week and the second drill early next week. The Company objective is to complete a minimum of 15,000 meters of drilling before the end of the exploration season. ☞ Who knows? This is a whole lot riskier than owning shares in the nation’s largest dredging company. But if we’re lucky, a few years from now we’ll have the last laugh. And if we’re not, we won’t care, really, because we only invested money in this one that we could truly afford to lose. ALISON GOES GREEN; YOU GO PURPLE Okay. I promised it for today, so here it is – tomorrow.
People’s Stories June 18, 2007March 6, 2017 Well, I’m sorry, but June is ‘Gay Pride Month’ and there’s just too much progress to ignore. BOSTON MARRIAGES ‘Boston Marriages’ had this meaning, at least for women, even before they were legal. But here we are 100 years later and the Massachusetts legislature voted 151 to 45 to uphold marriage equality. And why? As reported by the Boston Globe: Personal stories changed minds By Lisa Wangsness and Andrea Estes, Globe Staff | June 15, 2007 Representative Richard J. Ross, a Republican from Wrentham, had a revelation Wednesday afternoon after meeting with a gay Republican who presented him with this challenge: As director of his family’s funeral home, Ross had surely treated every family the same, no matter what their race, religion, or sexual orientation. So why would he do anything else in his other job, as a lawmaker? For Senator Gale Candaras, it was the 6,800 phone calls, letters, e-mails, even faxes, from her district that left no question in her mind what her constituents wanted her to do. One letter came from an 82-year-old woman who worried that one of her young grandchildren might grow up to be gay and might not be able to marry the person he loved. Senator Michael W. Morrissey, a Democrat from Quincy, said he ignored the lobbyists and the power brokers who wanted to talk to him and sought counsel from his wife, his family, his oldest friends, and a few constituents. He made up his mind moments before walking into the House chamber yesterday. “People’s ability to be happy is fundamental,” he said. “To pass judgment on that, in the end, I found hard to do.” The nine lawmakers who switched sides on gay marriage yesterday came from both parties, different parts of the state, and they traveled different ideological paths to their decisions. But in interviews yesterday, they seemed to share something in common: a desire to listen to all sides and a concern about hurting gay couples and families who they believed in many cases had experienced discrimination. The lawmakers spent hours, even days at a time during the last five months, meeting gay couples and their friends and relatives. Their personal stories made the difference more than anything else, the lawmakers said. “I listened and I listened and I listened,” said Representative Robert J. Nyman, a Democrat from Hanover who switched his vote after spending all day Tuesday meeting with constituents on the issue. “I just felt at this point, I was not comfortable putting people’s human rights on the ballot.” Arline Isaacson, cochairwoman of the Massachusetts Gay and Lesbian Caucus, said gay rights advocates working to defeat the amendment had put out urgent calls asking the gay community across the state to communicate directly with their lawmakers, and they did. “It made a big difference,” she said. “They were telling the story of their own lives, a story that a lot of these legislators didn’t really know.” Amendment opponents also benefited from a new freshman class that proved far more receptive to gay marriage than the lawmakers they replaced. Retirements, defeats, and resignations eliminated nine of 62 lawmakers who supported the amendment in January. At least four of the newcomers were thought to be supporters of the amendment, but only two of them voted for it yesterday. Representative Geraldo Alicea, a Democrat from Charlton, is a freshman who once promised to vote in favor of the amendment. But after he was elected, he said, “I thought it was best to be open-minded.” He spent many nights over the past five months meeting with gay and straight constituents. They included a couple who had been together for 28 years, and who, before they were married, had not been able to see each other at the hospital when one of them was seriously ill. He also spoke to a young lesbian couple who had adopted 4-year-old twins, and he said he found it difficult to imagine casting a vote that could hurt that growing family. Representative Paul Kujawski, a Catholic Polish-American who represents a conservative district in southern Worcester County, switched his vote after months of soul-searching. What changed his mind, he said, was meeting a lesbian couple from his district who helped him understand what it meant to them to get married after more than two decades together. “It was nothing more than that — wanting people to live happily,” he said. The couple came to the State House yesterday for the vote and found Kujawski in the crowd after it was over. “There were really no words,” Kujawski said. “Just hugs and tears.” Candaras had voted for the amendment when she was a House member representing a relatively conservative district with a large number of elderly people in Hampden County; now that she is a senator, she said, her new, much larger constituency made its sentiment clear to her. Some constituents wrote saying that they had changed their minds, like the elderly woman who said she previously asked Candaras to support the ban. “But since then, Gale,” the woman wrote, as Candaras told it, “this lovely couple, these two men, moved in next door to me, and they have a couple of children and they’re married, and they help me with my lawn. And if they can’t be married in Massachusetts, they’re going to leave — and then who would help me with my lawn?” Candaras said that after living with gay marriage for three years, many Massachusetts residents have grown accustomed to it, even those who once had reservations. “It’s a cultural change, and for older people, it is a difficult cultural change,” she said. “But I think people are coming to understand the issue and coming to appreciate the fact that the world is changing — and that these people deserve to enjoy . . . the same rights of marriage.” STEVEN BENJAMIN ON STEPHEN COLBERT Click here. It’s funny. Tomorrow (really): Alison Goes Green; You Go Purple
Four DON’Ts and a Bomb June 15, 2007January 6, 2017 DON’T SELL YOUR FMD If Tom Brown of bankstocks.com is right (big if, click here), it should be selling for about triple the current price. DON’T SELL YOUR HAPNW Fred: ‘Could you make some additional comments about the HAPN warrants? The warrants are at 36 cents and the underlying security is at $5.87. So aren’t we paying 36 cents to buy a security with an immediate 87 cent gain? This is like shooting fish in a barrel! Or is there some concern that the deal will not go through?’ ☞ Let me tell you how to shoot fish in a barrel: Buy a barrel, fill it with water and fish – or at least fish – aim and fire. Even that’s not so great, because you will surely destroy the barrel and, likely, the floor. (Best to do this outside.) But my point is: you will not find barrels of fish on Wall Street. A simple piece of grilled Dover sole, by the time you’ve had a glass of wine, some berries, tax and tip, will set you back $50 easy. (Guys, I need hardly mention, do not eat this way. Guys have Whoppers.) There is no free lunch on Wall Street. Am I straying from the metaphor? In the first place, yes, no deal may get done. Second, once a deal is done, you have to wait four months before you can exercise the warrants. And, third, who knows what a terrible deal this may turn out to be and how low the stock will drop? So ‘tails’ (we’ll get to heads in a second) you lose every penny of the $3,000 (say) you paid to buy 8,000 warrants. Fortunately, you knew to place this bet only with money you absolutely could afford to lose, so you’re philosophical about it – and you get to lower your taxable income by $3,000, making your after-tax loss only $2,000. (For the sake of this example, you are in the 33% marginal tax bracket.) Heads, on the other hand, the deal gets done, the stock does nicely over the four years the warrants have to run, and, when it hits $11, you exercise (buying the stock at $5 and selling it at $11), turning each 36-cent warrant into a $5.64 lightly-taxed long-term capital gain -$38,000 or so after tax. Unlike a heads-or-tails coin toss, there are more than two outcomes. (Here’s a third: the deal gets done but the stock is just $5.36 when you go to exercise your warrants -you break even.) And unlike a coin toss, the odds are not easily quantifiable. My gut tells me the odds of the stock hitting $11 in four years are better than 1 in 19. And yet, using this example (which I picked out of the air; there is no special significance to $11), you do 19 times better, after tax, if the coin comes up heads than if it comes up tails. So I’m in – but only with money I can truly afford to lose. DON’T GO TO GIBRALTAR David Plumb: ‘So, are you going to the Borealis Annual meeting in Gibraltar on June 27, or voting your proxies?’ ☞ You’re joking, right? (But, sure, it’s fine to send in the proxies and vote with management.) Apparently, they plan to webcast the meeting. Just head over to the Borealis site a day or two beforehand for details. DON’T SPEND A LOT OF TIME WANDERING AROUND VANCOUVER LOOKING FOR THE STOCK EXCHANGE Steve Baker: ‘For your information the Toronto Stock Exchange bought the Vancouver Stock Exchange about 5 to 6 years ago and promptly changed its name to the TSE VENTURE Exchange. [Which accounts for your confusion over the ‘V’ in the AXI-V symbol.] While there have always been more than some problems with the exchange, especially in the junior mining area, it should also be noted that it has always acted as a true junior exchange and usually in any given year 10-15+ companies graduate from the Venture exchange to full blown listings on the TSE. In some years more than 30 companies have migrated to other exchanges (either Montreal or Toronto).’ GAYS IN – THE ENEMY’S – MILITARY I suppose you saw this about preliminary interest in building a gay bomb. The ultimate ‘make love, not war’ tactic, I guess. I don’t imagine anyone actually took it seriously, but apparently it did get run up the flagpole. Monday: Alison Goes Green; You Go Purple