Author: A.T.

Going for Yield; Counting the Votes

See? I told you people would one day care about income again, once the musical chairs stopped and they couldn’t count on 30% gains in the stock market each year. Indeed, with the NASDAQ down from over 5000 to under 3000, Priceline down from 105 to under 3 and Yahoo down from 250 to 40, some folks have even . . . lost a penny or two.

 The safe way to get yield is with Treasury securities. But if you’re willing to take some appreciable risk, you have lots of alternatives.

One real estate investment trust I’ve long owned is B.F. Saul – symbol BFS – with shopping centers in the Washington DC area. It is definitely not one of the best REITs, which is the main reason it sells for just $16 a share when it pays $1.56 dividend. That’s 9.7% on your money.

Another hoped-for income-producer I own is Criimi Mae’s Series G Preferred stock. The common stock symbol is CMM. The company is in the mortgage business. The preferred stock trades for under $8 and promises to pay $1.50 a share dividend based on a $10 redemption price if the stock is ever called in. So this would give you about 19% a year, plus more than a 25% bonus if the stock is ever redeemed at $10.

A final thought: Ameritrade’s 5.75% bonds maturing August 1, 2004. Currently, they trade at around 56, meaning $560 for each $1,000 bond. You get $57.50 interest from each bond – better than 10% a year – and in less than four years, if the company survives, the bonds will be redeemed at their full $1,000 face value. This works out to a 25% a year compounded return.

There is risk in all three of these, which is why the yields are so attractive. You should never risk money you can’t afford to lose.

And now a word about the election.

I think Al Gore will be our next president, because I think the courts will be predisposed to counting the ballots. The Bush lead in Florida is currently 537 votes. But that’s without counting Palm Beach’s painstaking manual recount, and without counting 10,000 or so ballots in Dade County. When these ballots are counted, the Vice President will likely have carried Florida by a slim margin, just as with the national vote.

No one is asking for endless recounts – just one careful count. Those 10,000 or so ballots in Dade County have not been counted once or twice or three times – they simply have not been counted at all. The machine couldn’t read them.

A machine count is fine when a race isn’t too close. But when two candidates are separated by less than a tenth of one percent, what sense does it make to rely on a machine that is only 99%? It’s like measuring the width of a human hair with a yardstick.

The frame for this story all along should have been, ‘Closest Presidential Race in History – Outcome Not Likely to Be Known for Weeks.’ That was the unbiased truth. Nor was it terribly troubling.

Instead, the call was made by the Fox network at 2:16am on election night, and the other networks quickly fell into line. What a lot of people still don’t know is that the guy who made the call at Fox – Rupert Murdoch’s right-leaning network — was a Bush family member, who’d been on the phone to the Bush boys all night. The Bush family in effect declared themselves winners. And the other networks, perhaps panicked at being beaten, all followed suit within 4 minutes.

Clearly, at 2:16am Wednesday morning the race remained too close to call. But to much of America, Bush had won. The TV had said so. (Read the full story here.) And from then on, the Bush folks managed to cast any efforts actually to count the ballots as just so much bad sportsmanship.

But I think the courts will say the ballots should be counted, and that we will find that slightly more Floridians voted for the Vice President than for the Governor. And that’s even without adjusting for all folks who seem to have voted for Buchanan by mistake, or who double-punched confusing ballots, or who were intimidated into not voting.

(And, yes, it was rotten that the networks, earlier in the evening, had called Florida for Gore before the polls in the Panhandle had closed – this really was a colossal error. But the early call wasn’t made an hour in advance of the polls closing, just 10 minutes. It’s hard to imagine that most voters in the Panhandle hadn’t already voted. Or that, where they were already at the polling place, they didn’t stay to vote anyway – if only because there were other items on the ballot besides Bush v Gore.)

I wouldn’t bet my life on the outcome. And as I’ve repeatedly said, we should all rally round George W. Bush and wish him well if he wins. But it’s looking a lot better for Al Gore than the Bush folks would have you believe. Not only did Gore win more votes for President than anyone in the history of the country except Ronald Reagan, he likely also won the vote in Florida as well.

The Fifty-First State

Last week, Great Britain’s revocation of our independence made the Internet rounds. (We were being re-annexed in light of ‘[our] failure to elect a President of the USA and thus to govern [ourselves].’)

Our very own John Bakke, faithful reader, has a counter-proposal (edited slightly, to avoid an international incident).

Counter-proposal to subjects of the English monarchy

We, the people of the United States of America, in order to form a more amusing union, hereby extend an offer to the people of that quaint little island known as England (or Great Britain, or whatever) to become our 51st state. Given your reluctance to embrace full European unity, along with the challenges of competing economically on your own, this would seem to be an ideal step forward for you. There are numerous benefits.

1. Your government may remain mostly intact. Each of our states has its own administration, and if you want to continue under a Parliamentary system and call your governor a ‘Prime Minister’ . . . well, we think that would be very cute and would encourage you to do so. Your laws would need to jibe with our Constitution, but we expect that you would enjoy having actual rights under the law, for a change.

2. You can keep the royals. Of course, the Windsor family would have no actual legal standing, but let’s face it, they don’t count for all that much now. Their value as a tourist attraction is unquestioned, though, and we expect Disney will greatly enhance their appeal once it assumes administration of the various palaces and castles. You should feel free to bow or curtsey or do headstands or turn cartwheels or whatever nonsense you think they’ll find amusing when you meet, but as citizens and not subjects you need no longer feel obliged.

3. A clean break from Europe. Admit it: you’re dying for this. Yes, it’s a shame you can’t manage it on your own, but get over it. However, as America’s trading gateway to the continent, your economy would soon be booming.

4. Minimal cultural impact. For those of you worried that your streets will be filled with American fast-food franchises, your cinemas filled with mindless American movies, we would suggest that you take a look around. It’s already happened, and it ain’t going away. As for language, you should preserve your charming accents and even spell or pronounce words however you like. We’re not sticklers for that sort of thing.

5. Superpower status. The Empire isn’t coming back, so this might be the next best thing. Over here, we’d be happy to see you take over the American involvement in NATO. Over there, you would probably enjoy having the French and Germans bluster and whine about your clumsy leadership in the alliance, but falling into line like little puppies when you finally get around to deciding what should be done. It’s really good fun, once you get the hang of it.

6. Your own stamp! Sadly, the pound must go. You can migrate to the dollar gradually, but look on the bright side: at least it isn’t the Euro, whose paper notes feature drawings of imaginary places because there would never be agreement about which country’s cities or leaders should be on which denominations. We’ll even put an English historical figure on a new note or coin (Churchill is the only one we know, but you can take your pick). We can’t allow any royalty on our currency, alas, but there’s no reason we can’t put the Queen and family onto postage stamps.

If you’re reluctant to go for full statehood, we might be able to work out something like the deal we give other island dependencies, such as Puerto Rico or Samoa. But we think you’ll enjoy having your own representatives in Congress, fighting to have useless Federal projects established in the State of England to boost your local economy. And we know you’ll love participating every four years in the world’s most important election. You don’t even need any particular voting equipment — any outdated system you already have will suffice. Just fax in your vote totals whenever you can agree on them.

Thanksgiving

Thank heavens for little girls (for little girls, as Maurice Chevalier sang, ‘get beeger everyday’).

Thank heavens for The West Wing (NBC, tonight, at nine).

Thank heavens for our low unemployment, low inflation, and national security; safer streets, cleaner air, and bottled water.

Thank heavens for family and friends and the kindness of strangers.

Thank heavens for aspirin, penicillin and Prozac; Ben Franklin, Thomas Jefferson and Albert Einstein; Katherine Hepburn, Bette Middler and Tom Hanks.

Thank heavens for generosity, humor and optimism; open minds, open doors, open hearts.

Thank heavens George W. Bush signed a law requiring that dimpled ballots be included in a manual recount.

Happy Thanksgiving!

Three Things You Should Know

1. See MEN OF HONOR with Robert De Niro and Cuba Gooding, Jr. I love that it’s based on a true story.

2. American is my favorite airline. But for cities American doesn’t serve, or when I’m feeling particularly cheap, it’s Southwest. If you’ve never flown Southwest, click here. Or call 800-I-FLY-SWA. (It is the most amazing thing: humans answer — generally on the first ring.) You need not book months in advance to get great fares — or stay over a Saturday or fly roundtrip. There are no $75 penalties for changing your plans. The flight attendants make you laugh. (‘Place your seatbacks in their upright and most uncomfortable position,’ they are fond of announcing.)

Yes, the planes are heavily laden with noisy families and vacationers; yes, you will need to bring your own lunch; yes, seating is first-come-first-served; and, yes, you may have to travel a good distance to find an airport Southwest serves. New Yorkers have to go 45 minutes beyond Kennedy to Islip; Washingtonians need to get to Baltimore; Miamians, to Ft. Lauderdale; Angelinos, to Burbank. But check it out. It can save you big bucks.

(There’s no First Class to be upgraded to on Southwest. One friend who strongly prefers First Class surprised me by saying he didn’t mind this. ‘You?’ I asked, incredulous. ‘Well,’ he said, ‘I don’t mind not being in First Class as long as no one else is.’ )

Hint: never plan to buy or fix your ticket at the airport. The lines are horrendous. But with a ‘ticketless’ ticket, you go straight to the gate, get a boarding pass (in either the first 30 to board and choose seats, the second 30, the third 30, or the fourth 30 – so come early), and off you go.

Some of you already knew this; some never fly; a few would never fly coach. But the rest of you may easily have saved $500 a year.

3. ‘Forte’ is only pronounced ‘for-TAY’ if you’re talking about a loud piano instruction. If your forte is annoying people by correcting their English, then you pronounce it FORT. Look it up.

 

More MONEY!

Today’s column will again touch on money — yea, verily, specific stocks! — even if it takes me a minute to get there.

Paul Jakubowski: ‘What goes around comes around. My trusty MYM came up this morning with the following quote: ‘Voters decide nothing; people who count votes decide everything. – Stalin.”

☞ I guess this highlights the need for ‘standards’ in counting the votes. How about we agree to count the vote if:

(1) at least two corners of the chad are detached; or

(2) light is visible through the hole; or

(3) an indentation on the chad from the stylus or other object is present and indicates a clearly ascertainable intent of the voter to vote; or

(4) the chad reflects by other means a clearly ascertainable intent of the voter to vote.

Why these standards? Because they come directly, verbatim, from the 1997 Texas statute signed by Governor Bush.

That statute also provides that if different people request different kinds of recounts – e.g., one wants a manual recount and another wants an electronic recount – the method chosen should follow a little hierarchy to decide which to use: ‘A manual recount shall be conducted in preference to an electronic recount and an electronic recount using a corrected program shall be conducted in preference to an electronic recount using the same program as the original count.’

Dana Dlott: ‘Trying to get your mind off the election . . . About 1 1/2 years ago I sent you this message:

Can you explain something to me? There are lots of very well run corporations everywhere in the world. Basically all of them have CEOs who work for a tiny fraction of the compensation packages many American CEOs get. Why don’t our US corporations replace their costly CEOs with foreign CEOs who will do the same job at a fraction the price?

‘Now it looks like it is happening. The big news in the NYTimes yesterday was Daimler replacing Chrysler’s CEO with a German. After all, there must be a cheaper guy who can lose $512 million in a single quarter. Hope everybody else catches on . . .’

☞ I hope so, too. The same boards of directors that expect a tough bargaining stance to be taken with labor often look forward to delighting their CEO. Partly this is because the directors and the CEO are frequently friends. Partly it is because the directors are frequently CEOs or ex-CEOs themselves – members of the club. Partly it is because the last thing a board wants to do is search for a new CEO.

Of course, it would be shortsighted to save a few dollars on the leader’s salary . . . lose him or her . . . and see the enterprise falter. So there is a balance here. But things have swung awfully far in favor of the CEO. Many boards, I think, could do better by their shareholders.

And speaking of shareholders, you guys have got me feeling incredibly guilty for writing about the election when I should be putting my shoulder to the task of making you some money.

As I think I’ve made plain over the past 1200 columns (this is #1201), I have no clue how to make you money. If I did, I would charge more. I tend to think – as I suggested Friday – almost everyone does best who goes the simple route: periodic investing in a couple of index funds.

Still — as intrigued by the game as anyone else (and eager to control my own tax consequences) — I do invest in individual stocks. In fact, when I’m feeling really self-destructive, I even short stocks. (I am almost always right about my shorts, but lose a lot of money anyway, because I’m right too soon. As famed retired short-seller Robert Wilson has said, ‘You need to decide whether you want to be right or you want to make money.’)

When I’m out to ruin you as well as myself, I even once in a while share my ideas.

On March 14, I ran a column entitled Five Stocks You Should Consider. It began by knocking Dell as seemingly overpriced at 51 (eight months later it is a lot more reasonable, if still not cheap, at half the price) . . . and then suggested five stocks to buy, that have since appreciated about 38%. This is particularly strong performance given how the rest of the market has fared, and far better than I could ever have done on my own. As I explained in that column, these five weren’t my ideas, they came from a guy who is really smart and who, equally important, really does his homework. I am, truth to tell, too lazy to do my homework.

I wouldn’t buy these stocks here, now that they’re 38% more expensive, but I wouldn’t rush to sell them, either. My friend tends to buy for the long-term. He looks for stocks that, over time, will rise even more than 38%.

On August 22, again feeling guilty for writing too much about cooking or guns or some other damn fool thing, I screwed up my courage and suggested another little batch of stocks.

If I were you [I wrote in response to a reader’s question], I would consider a steady program of periodic investments in a couple of index funds. Or, if you have a taste for it, the acquisition of a portfolio of your own, geared toward long-term, tax-deferred capital gains. Being one to go from the sublime to the ridiculous, I might include some Microsoft (MSFT), some McKesson (MCK), some Canada Southern Petroleum (CSPLF), some Criimi Mae (CMM), a little Calton (CN), and — from the ridiculous to the preposterous — 100 shares of Borealis (BOREF). And just wait five years and see where they are. If they’re much lower, you’ll hate me, but have the satisfaction of knowing that I lost even more than you did. If they’re much higher, you will have long since forgotten who suggested them. (Do not “pay up” for these stocks. They are currently selling for around $71, $25, $6.50, $1.56, $4.50 and $3.50, respectively.)

This little group was more of my own cobbling together, which may explain why it is down a bit since I held forth. Then again, we’re only a few months into that five years.

MSFT, as many of you know, dipped as low as $48, but has come back to $69. Obviously, it would have been a lot smarter to wait and buy it at $48 than to pay $71. MCK is up from $25 to $31. So on those two, as a pair, you’d be a little bit ahead. Not surprisingly, perhaps, those two were the only ‘adult’ stocks in my basket – the kind of stocks a bank trust department might be willing to hold on your behalf.

CSPLF, down from $6.50 to under $4, owns a lot of natural gas in Canada, and one giant lawsuit. If it ever won that lawsuit, I’d be able to retire from writing this column. Even without winning the lawsuit, this is the kind of stock I like. No one has ever heard of it, people are doubtless selling in disgust for a tax loss – and who knows? One day, natural gas could be worth something.

CMM is down from $1.56 to $1.12 or so – but not really, because it also just issued 6 shares of a preferred stock for each 100 of the common that you owned, so if you do all the math, it’s more or less where it was. It seems to be emerging from bankruptcy. My hope is that I might triple my money over the next few years in CSPLF and CMM. (Of course, I am keenly aware that I may lose it, also.)

CN is down from $4.50 to $3.50. This is the stock on which we originally made several times our money, culminating in a column I entitled The Lunatics Take Over – Yippee! But then the dot-com fever it had improbably got caught up in broke, and before you knew it the lunatics were gone and it was back to being unwanted at any price. I don’t mind paying $3.50 a share for $7 a share in cash (and no debt). I know bad management could squander all the cash and leave us with nothing. But management owns so much of the stock, I’m willing to gamble that it won’t.

BOREF, meanwhile, has become ever more weird. It seems to be trading about where it was before, but in tiny amounts in obscure places — not every brokerage firm or quote service will be able even to furnish you with a quote. But talk about investor relations! You can find out all sorts of things about what the company claims at www.borealis.com. This is a stock that is surely going to zero, as I have written before. But I have bought vast quantities of it over the last year or two, because what is life without a dream?

And now can I say one last thing about politics? Our economy may give us cause to worry – it’s been a long time since our last recession — as may the expanding hole in the ozone layer. But our Constitution? All that’s going to work out fine. And if it’s Bush who wins, even though I hope it’s not, we will all rally round and wish him well.

MONEY!

Gene Daly: ‘Please recommend a few FINANCIAL sites. You know the kind, ones that talk about market bottoms, value stocks, growth stocks, good mutual funds, stuff like that.’

☞ No one knows where the market bottom is, and if you buy mutual funds, buy low-expense index funds. Over time, you’ll beat almost all the others (and no one knows in advance the few you won’t beat).

Oh, OK. By popular demand, today’s column will be at least a little bit about money. But you know, the best thing you can do most of the time is . . . nothing. The more you trade, the more you rack up transaction costs and expose yourself to taxes. So in a way, my trying to distract you with all this political stuff is a great financial service.

What most people need is a simple, automatic discipline whereby they add to their holdings each week or month, via their 401(1) at work . . . and perhaps their automatic mutual fund investment . . . or the automatic electronic transfer they make each month from their checking account to their brokerage account. That kind of thing. Plus the wisdom to delight in the little cost savings they devise. (Some of you will recall my ode to the T-shirt as just one example.)

If markets are headed down, just say to yourself, ‘Hot dog! I am scooping up assets at even better prices! I am a lucky fella.’ If markets are headed up, you say to yourself, ‘Hot dog! I am getting richer by the minute! I am a lucky fella.’

(Fella, I have decided, is a gender neutral word. It has the male connotation from ‘fellow,’ with the Latin female suffix.)

Monday, I will take a look back at some of the (very-cautiously-couched) recommendations I’ve made in this column, claiming full credit for all the money I made you on some of them, and disclaiming any responsibility for the rest.

But for now . . . well, I’m sorry . . . I’d rather listen to you.

J Colson: ‘The inference that Bush will fail because Adams did 175 years ago is too much. I didn’t subscribe to hear graceless innuendos. Remove me from your list.’

☞ The point of Tuesday’s column – at least as I read it — was not to predict that W., if he wins, will fail. Frankly, I think either man will have a tough time. And as Joyce Chaplin reminds us: ‘After losing reelection, John Quincy Adams had an illustrious post-presidential career, especially as a critic of slavery in the big argument leading up to the Civil War.’ GWB could do worse than be compared to JQA.

Hank Gillette: ‘One thing we’ve gotten from this election, win or lose, is that the Republicans now agree that if you think your rights are being abridged by state law the proper action is to seek redress in Federal Court.’

Julia F: ‘Am I asking myself, as a Nader voter, ‘What Have I Done?’ Absolutely not. I’ve got a stack of health care bills that my HMO refuses to pay (Nader’s plan, if you don’t know, has an assurance of universal health care pronto) . . .’

☞ How wonderful of Nader to assure that for us. But what does ‘pronto’ mean – that in 20 years, when a Green party candidate somehow wins the White House, she can fight a very tough battle with Congress, as the Clinton administration did, and maybe, conceivably, 25 years from now, you’ll have it? How is that ‘pronto?’ Wouldn’t Gore likely make more progress toward this goal than Bush? And toward a true patient’s bill of rights?

‘ . . .I’m concerned about the ozone hole in Chile (Nader’s plan ended public subsidies & tax breaks for industries that harm the environment); and I am mad about corporations subsidizing campaigns (you probably understand by now that Nader doesn’t accept those contributions) . . .’

☞ I wonder how many corporate contributions he had to turn away. Of the four leading contenders for the Presidency, Gore, Bush, Bradley and McCain, all but one strongly supported the McCain-Feingold bill that would have made a good start at campaign finance reform. The one who opposes it? The one Nader may wind up having elected.

‘ . . . Most of all, I’m confounded by the fact that this is still a two-party country. I’m proud that I voted for Nader. I voted for progress. I stand behind my vote 100%. And the election isn’t over yet.’

☞ I bolded that final comment because it hints at the possibility you care who wins. If so — why? Is it because you think that one candidate is more likely to fight for the things you cite? Look at it this way. If the election came down to one vote and it were yours, would you prefer to see it go to Bush, because you voted for Nader? You are saying yes, but — at the risk of being presumptuous — I wonder whether you really feel that way.

Robert Doucette: ‘Your thought on a coin toss is not so far fetched. CNN reports that in case of a tie in New Mexico, the law provides that the winner IS determined by a coin toss or a game of cards.’

[CNN reports: ‘New Mexico statute requires that in case of a tie, ‘the determination as to which of the candidates shall be declared to have been nominated or elected shall be decided by lot.’ In practice, the usual method for this rare event has been to play one hand of five-card poker. This was last done in December 1999, in a local judge’s race. Republican Jim Blanq and Democrat Lena Milligan played one hand of poker in a courthouse with dozens of people watching, and Blanq won.]

☞ One advantage of a coin toss is that it would mute somewhat the perception of illegitimacy the winner might otherwise suffer. There are many theories about the fairness of machine counts versus manual counts. (On this point, I side with Governor Bush, who signed a 1997 Texas statute mandating that, when recounts are requested, ‘a manual recount shall be conducted in preference to an electronic recount.’) But whatever your views of chads and dimples, everybody knows that a coin toss is fair.

Jimmy Dolklyn: ‘If you laid all the journalists who called the Florida election early end-to-end across the Atlantic ocean, it would be a damned good start.’

And just how did it happen that Bush was briefly declared the winner? Which, after all, laid the foundation for the notion that the election is ‘his,’ and that all this foolishness about counting the votes is just sour grapes. The call was made by Fox at 2:16am, and the other networks quickly fell into line. The guy who made the call at Fox was a member of the Bush family, who’d been on the phone to the Bush boys all night. So one might say it was the Bushes who managed this PR coup, framing the terms of all that followed. Read the full story here.

The View from Abroad – II

What a crazy notion – count all the votes in Florida . . . very carefully . . . since the margin currently separating the two candidates is a mere five thousandths of 1% and machines don’t count every vote. Sure sounds wacky to me.

(If all the voters in Florida were laid end to end, they would stretch from New York’s Times Square south to Miami, west to Los Angeles and then back East to around Chicago. The margin currently separating the two candidates wouldn’t even get you to Penn Station, 8 blocks away.)

Or, as I’ve suggested, since the entire election was essentially a tie: flip a coin, and the loser has to be President for the next four years.

Meanwhile, making the rounds of the U.K. – and now the U.S.:

To the citizens of the United States of America,

In light of your failure to elect a President of the USA and thus to govern yourselves, we hereby give notice of the revocation of your independence, effective today.

Her Sovereign Majesty Queen Elizabeth II will resume monarchical duties over all states, commonwealths and other territories. Except Utah, which she does not fancy. Your new Prime Minister (The Rt. Hon. Tony Blair MP, for the 97.85% of you who have until now been unaware that there is a world outside your borders) will appoint a minister for America without the need for further elections. Congress and the Senate will be disbanded. A questionnaire will be circulated next year to determine whether any of you noticed.

To aid in the transition to a British Crown Dependency, the following rules are introduced with immediate effect:

1. You should look up “revocation” in the Oxford English Dictionary. Then look up “aluminium”. Check the pronunciation guide. You will be amazed at just how wrongly you have been pronouncing it. Generally, you should raise your vocabulary to acceptable levels. Look up “vocabulary”. Using the same twenty seven words interspersed with filler noises such as “like” and “you know” is an unacceptable and inefficient form of communication. Look up “interspersed”. Also “Oh really?” is not the only way of showing interest when in conversation.

2. There is no such thing as “US English”. We will let Microsoft know on your behalf.

3. You should learn to distinguish the English and Australian accents. It really isn’t that hard.

4. Hollywood will be required occasionally to cast English actors as the good guys.

5. You should relearn your original national anthem, “God Save The Queen”, but only after fully carrying out task 1. We would not want you to get confused and give up half way through.

6. You should stop playing American “football”. There is only one kind of football. What you refer to as American “football” is not a very good game. The 2.15% of you who are aware that there is a world outside your borders may have noticed that no one else plays “American” football. You will no longer be allowed to play it, and should instead play proper football. Initially, it would be best if you played with the girls. It is a difficult game. Those of you brave enough will, in time, be allowed to play rugby (which is similar to American “football”, but does not involve stopping for a rest every twenty seconds or wearing full kevlar body armour like nancies). We are hoping to get together at least a US rugby sevens side by 2005.

7. You should declare war on Quebec and France, using nuclear weapons if they give you any trouble. The 97.85% of you who were not aware that there is a world outside your borders should count yourselves lucky.

8. July 4th is no longer a public holiday. November 8th will be a new national holiday, but only in England. It will be called “Indecisive Day”.

9. All American cars are hereby banned. They are crap and it is for your own good. When we show you German cars, you will understand what we mean.

10. Please tell us who killed JFK. It’s been driving us crazy.

For those of you who get this column by Q-Page, my apologies for any choppy waters of late. Kinks are being ironed out, I am assured. (If you think I’m underpaid for writing this column, you should meet my long-suffering, yet always accommodating, webmaster.)

Views from Abroad

Rick Steves: ‘After each European trip, my favorite souvenir is a roughed-up perspective. Time and time again, Europeans make this liberal feel like a crusty old conservative. Even though I’m a committed American capitalist and would live nowhere else, I’m fascinated by European attitudes and solutions. Consider these recent jolts to my American outlook:

‘Hiking along an Alpine ridge with a Swiss friend, I asked, ‘How can the Swiss accept such high taxes?’ Without missing a step he asked, ‘What’s it worth to live in a country with no hunger and no homelessness?’ Then, as if to hit me when I’m down, he added, ‘In Switzerland our minimum wage is double that of America’s.’

‘Chatting with friends in an Amsterdam coffee shop, I boasted that crime is down in the USA. ‘Yes,’ my Dutch friend told me, ‘but American jails hold one-quarter of all prisoners on earth.’ He added, ‘A society must make a choice: tolerate different lifestyles or build more prisons.’

‘In Rome, I enjoyed the colorful dance of searchlights on the 2000-year-old face of the Coliseum. Once a theater of death, today the Coliseum is a symbol of life. An Italian explained, ‘Every time a death sentence is commuted in the USA, Romans celebrate with a light show on our Coliseum.’

‘Biking through a forest of sleek modern windmills on the Danish island of Aero, I clucked about how the USA led the world in Olympic gold medals. ‘In number perhaps,’ my Danish friend said, ‘but per capita, the Danes have triple the American total.’

‘Aero’s residents are in a race of their own: to be the first completely wind-powered community in all of Europe. They’re on track for a gold medal in environmentalism. Like many Europeans, the Danes don’t measure standard-of-living in material consumption. Compared to Americans, they consume less and believe they live better.’

Antoine: ‘When you don’t live in the US and you haven’t been there for a while (I’m from Switzerland, I live in Canada), you may start thinking that all of the richest, most powerful nation on earth looks like Park Avenue or Rodeo Drive and is populated by high-tech wizards earning six-figure salaries. When you think about it, you realize that much of the country is dilapidated, millions live in shacks and can barely read and write, life in the inner city is getting worse, inequalities are growing, millions are still without health insurance while an increasing number of people choose to equip themselves with guns and lock themselves up in private gated communities. I could go on and on. I think there is a case for taxes. As long as the US trails behind most industrialized countries in quality of life/human indicators, I don’t think anyone can possibly argue for lower taxes and lower government involvement in the US. The rest of the world is watching. Please don’t disappoint us.’

Pam Murray: ‘Being a foreigner, I’m not even allowed to vote in this election. That doesn’t preclude me from pointing out that you should be ashamed of yourself for calling Ralph Nader a big fat idiot. Stick to policies, not personalities. It is possible that the challenge which Ralph Nader made, and the support he has garnered has swung the ballots cast in favor of your opponent, but bear in mind that intelligent people made a conscious decision to support someone other than your candidate. Al Gore stands for many good things, but ponder on why exactly approximately one half of those who stood up to be counted, chose to count against him. Perhaps what you are really implying is that anyone who doesn’t agree with you is the idiot — and that is indeed the true sign of an idiot. An apology and a retraction seem to be in order.’

☞ Thanks, Pam. What makes Ralph a big fat idiot (which of course is not meant literally, as almost everyone realizes) is that the issues he cares about could now be set back drastically. I suspect more than a few of the 100,000 Nader voters in Florida are now wondering ‘what have I done?!’

The Adams Family

Alan Flippen: ‘Having had WAY too much time on my hands, I decided to do some historical research. Here’s what I found about the only previous father-son team to serve as President:

  • John Adams served two terms as the vice president of an immensely popular president before being elected in his own right.
  • As president, Adams pursued a successful foreign policy but botched his domestic policy, and alienated large segments of his own party. After one term, he lost his re-election bid to a Southern Democrat with a history of marital infidelities.
  • Adams lived to see his son, John Quincy Adams, become president in a disputed four-way race in which he ultimately prevailed despite losing the popular vote to a Democrat from Tennessee.

‘What the future holds for the Bushes if history continues to repeat itself: Adams Sr. died midway through his son’s term of office. John Quincy Adams was unable to get any of his policies through a hostile and divided Congress. After one term, he faced a rematch with the Democrat from Tennessee, and lost in a landslide.’

☞ I’m not saying this means anything; just that, as is so often the case, you guys come up with more interesting things than I do.

Peter Madaus: ‘The Pirates won the 60 World Series . . . but if you reverse it (Pirates won games, lost runs), Yoder’s analogy yesterday works.’ Mike Watts: ‘The Pirates beat the Yankees 4 games to 3. New York out-hit Pittsburgh 91 to 60, out-scored them 55 to 27, out-homered them 10-4 — and still lost.’

We Live in Interesting Times

Enough with the politics, already!

Want to break the tension with a good movie? Go see Billy Elliot. Go see Best in Show. (And if you like Best in Show as much as I think you will, rent Waiting for Guffman, by the same people – it’s a cult classic.)

Want to visit a smart website for smart value investors? Click here. It will be closed to guests at some point, but in the meantime you may find some great ideas. And if your own ideas are sharp enough, you may become a member of the club.

Now, back to politics.

You know why this is a great country? Because you can click on a site like this and distort the faces of either of our next possible Presidents. It’s a marvel of technology and political freedom. And completely useless.

Tom Cuddy: ‘Watching George W. Bush quickly naming his transition team reminds me of a football team rushing up to the line of scrimmage to get the next play off before instant replay can be used to reverse an obvious mistake!’

Joel Williams: ‘The whole Florida thing is very frustrating, since there is a clear technical solution. You could easily build a special terminal and program it to take a person’s vote. You could make sure that he did not vote for two people for the same office, for example.’

Karen Tiede: ‘Re your suggestion that they toss a coin — it’d only land on edge.’

Jim Kozma: ‘Now you’re just being flip.’

Dan’l Leviton: ‘How about they govern on alternate days?’

Ray Heer: ‘Let Gore be President of the blue states, Bush be President of the red states, and Florida become the next banana republic.’

Jim McHenry: ‘Isn’t it wonderful we live in interesting times? I really mean that. All this talk about how court challenges will weaken us. Baloney! It shows our strength. It shows how good our system is. How it works best even under stress. God bless America no matter how it turns out.’

Eric Batson: ‘How about for a little while you run a parallel column on the electoral college? Maybe we can fix this thing for the future. (A parallel column so your nonpolitical readers are mollified about its not being on finance.)’

☞ To me the Electoral College is an easy one. Yes, there are good arguments on both sides, with the abolitionist argument probably the stronger of the two. But strong enough to amend the Constitution? One of the things that gives the Constitution strength is our rarely messing with it. I’d rather put our energies into campaign finance reform, which would be far more important and not require tampering with the Constitution.

J Yoder: ‘The electoral college is not such an out-of-date idea. The World Series is determined by who wins 4 games (electoral votes) and not by who scores the most runs (popular vote). In the 1960 World Series the Yankees beat the Pirates 4 games to 3, but lost the total runs scored by a very large margin. The framers of the constitution were very worried about excess power by the majority. That’s why we have a Bill of Rights. Electoral votes restrict the effect a large state like California or New York can have on an election. If politicians win the urban areas by a large enough margin (and we are increasingly becoming an urban country), then it wouldn’t matter what happens in the rural states.’