AS IF IT WASN'T BAD ENOUGH that Subway's sole form of advertising involves subjecting the American people to the not-funny and not-innovative maunderings of Mr Jared Fogle, the ubiquitous sub chain is now taking issue with other companies' advertisements just because they're funny.
OK, OK, maybe that's a bit much. Still, the people behind Subway have sued rival sandwich chain Quizno's over an ad campaign that portrays Quizno's sub sandwiches as superior to Subway's. Subway's attorneys, according to The New York Times, claim Quizno's advertisements -- some of which were dreamed up by actual normal people, and not advertising executives -- were defamatory. Why, these advertisements contained "literally false statements" and depicted Subway in a "disparaging manner," according to the chain's lawsuit.
Well, boo-fucking-hoo. What the hell is wrong with these people? Jesus -- get out there and kick some ass! If your competitor decides he's going to openly attack you, you don't go whining to your lawyers and send nastygrams -- you go out and fight back. Not only that, you beat him so frickin' bad that the mere thought of your campaign will send him into spasms of whimpering. I'm serious. If this means sending Jared into a Quizno's franchisee meeting with a baseball bat and videotaping the ensuing spectacle, then do it.
I mean, it's not like we haven't been through this before. Remember the Cola Wars, and how the evil people behind Pepsi tried to overthrow the Coca-Cola Co. in their sick quest to rid America of everything good and decent?
God, those bastards -- tricking our young people into thinking Pepsi was cool and with it? Lies -- all lies! But Coca-Cola didn't just sit there, now did they? Hell, no. They fought back. That's exactly what Subway should be doing here. Instead of going to their lawyers and crying, they need to go tell their advertising people to ... well, have a little fun with the situation. Then they can sit back and let the ad people go to work, and the next thing you'll know, the Quizno's people will be begging for mercy, because it's not fair the Subway people compared their giant footlong subs to those tiny little mini-sandwiches, or whatever it is Quizno's rolled out recently. So get to work, Subway! You aren't going to let those rotten scoundrels get away with this with their egos intact, are you?
WELL, THIS "ARCHIVAL FOOTAGE" makes it pretty clear, if you ask me:
(post title, and link, via Oliver Willis)
LADIES AND GENTLEMEN, MEET Nathan Drake. He is 30 years old. He both lives and works in Whittier, Calif. He is a Canadian expat. After taxes, he brings home some $3,000 per month. He is now $54,000 in debt.
Mr Drake has come to the world's attention through a profile in the Los Angeles Times. Amazingly, Mr Drake volunteered to have his profligate lifestyle featured in the pages of that newspaper, courtesy of its Sunday Business section, which publishes what are known as "money makeover" stories. I can assure you that profligate -- that is, wildly extravagant, or completely given up to dissipation and licentiousness -- is not an unkind word to describe Mr Drake's finances. He spends some $2,000 more than his take-home pay each month, and was forced to use his overdraft protection twice in the past month. Only now has he realized his lifestyle is unsustainable.
Well, actually, no, he hasn't. Consider: Mr Drake has a partial share in a boat, worth some $1,500 or so. Yet he will not sell it. Why? Well, he uses the boat to go on vacation. How exactly he pays for these vacations when he owes $29,000 on his six credit cards and some $16,000 to his bank (presumably for the loan on a very expensive truck); well, that seems to be a secondary consideration.
Of course, the situation is not entirely lost. The Times reports that Mr Drake may be able to boost his income some $12,000 per annum if things go well at work. Oh, and -- the coup de grace -- his wife is apparently going to indenture herself to help pay off his debts:
And when Jodi changes her immigration status and becomes a permanent U.S. resident, she'll start working too. Drake, a permanent resident, is awaiting his U.S. citizenship. It could take as long as a year for him to become a citizen and six months more for his wife to get her residency, said Louis Piscopo, an immigration attorney in Anaheim.
For now, though, Jodi must return to Canada while seeking residency. There, she plans to work for her sister's clothing company and to send most of her monthly paycheck to Drake.
This guy's not a husband, he's a pimp.
I would be much more sympathetic (and consequently not so harsh) if Mr Drake had not involved his wife in his sordid profligacy. People make mistakes in life and everybody, of course, is deserving of a second chance, and it seems Mr Drake could receive one if he negotiates with his creditors. But it is one thing if you are screwing up your own life, and another entirely if you're screwing up someone else's along with it. Thus, it is entirely unjust to Mrs Drake for Mr Drake to not take every single possible action to right his financial ship. That doesn't just mean selling the boat or getting a cheaper car, either -- for her sake, he should resign himself to living a monk's existence for the next few years until he can get his house in order.
Now, if I were Mr and Mrs Drake, I would set out this plan. Mrs Drake should work while she is in Canada, but instead of giving her hard-earned to her husband, she should save it for an emergency fund -- it seems clear the couple doesn't have two nickels to rub together otherwise. In the meantime, Mr Drake should negotiate with his creditors, force himself to live below his means, and dispose of every single luxury that he can to help boost his finances. That means the boat and the truck and his pet rock and anything else he's got.
It will take a hell of a lot of work, of course, for Mr Drake to get himself out of the hole he is in. But he can do it. Once he takes the first few steps down that very long road, he'll find that each passing step will get easier; eventually he will start walking at a nice clip, and then sprinting along. But I fear the trouble here is that Mr Drake will not summon up the will to do the things that need done. That's a true shame, because hitting bottom is no fun at all; but from the story, it sounds as if hitting bottom will be the only thing that wakes Mr Drake up from his stupor.
A WHILE BACK I had written a few posts extolling my own cleverness at having bought shares in E*Trade Financial Corp., the on-line brokerage.
On Nov. 14, for instance, I cheerfully recounted how smart I was to buy in at roughly $4.21 per share, and how this had made me 25 pc on paper in just one trading session. On Nov. 30, I wrote about E*Trade's deal with Citadel, and how the trading on that particular day proved that many -- although not all -- day traders are dumb. Then, on Dec. 4, I wrote about how some idiot analyst at Bank of America downgraded the stock, a move which turned my paper profits into paper losses. The analyst, whom we know is an idiot because he spoke out against one of my positions, claimed the stock would drop to $2.
Of course, the stock DID drop to just over $2 roughly five weeks later. At this point, I have to admit I was kind of hoping Loyal Rant Readers would conveniently forget that I had been so gleeful earlier. But I still had confidence in the thing, and it would appear that my confidence has paid off. At least for the moment. For ETFC closed out the day today at $3.90 per share, which means I'm about where I was on Dec. 4 -- down $20. Behold my intestinal fortitude. Behold my triumph. I rule!
There's even better news too: the latest short-selling data came out, and it shows that between Dec. 31 and Jan. 15, the short interest in ETFC -- i.e., the people betting ETFC will fall in value -- rose 12.2 pc over that time frame. That's something on the order of 9 million shares. Now, at the end of the day on Dec. 31, ETFC was trading at $3.55 per share; at the end of the day on Jan. 15, ETFC was trading at $2.92 per share. Now that it is at $3.90 per share, one can deduce the short-sellers behind that increase have in the aggregate lost money. Not all, of course -- one can imagine a lot of smart folks got out when the stock hit $2 or around there. But it seems pretty clear there are plenty of folks who have entered a world of pain as a result.
This is good for buy-and-hold types like me, who are "long" on E*Trade. This is because short-sellers make money through borrowing shares and selling them. For instance, if Trader A shorts 5000 shares of Stock X at $10, and Stock X falls to $7, he has made $15,000. But to close out his position, he must actually buy the shares that he borrowed and sold and give them back to the original owner -- thus pushing the price of the shares upwards.
I have no idea, of course, whether the recent rise in ETFC's shares is primarily due to short-sellers covering their positions. But that sure would be great. You see, like most "long" investors, I view short-sellers -- at least those with the audacity to short my holdings -- with scorn and contempt. If they had decided to short something else, well, business is business. But if they short my stuff, their actions inherently depress the value of my investments. As such, there's part of me that quietly hopes they get cholera, because they are clearly all secret Communists and obviously hate truth, justice and the American Way.
What's that? OK, so that might be a little much. Thus, I guess I'd settle for "them losing money" and "me making it." Also, should any of them find themselves hanging from the brink due to a margin call, I want to stomp on their fingers and laugh maniacally. Hey, the markets give no quarter, and neither do I.
DISCLAIMER: This is in no way intended as financial advice. Even a cursory glance at ETFC's charges will show investing in ETFC is an incredibly risky proposition. Thus, you should only invest in anything after reading an actual prospectus and talking it over with an actual financial advisor, you know, someone who knows what he's doing and stuff. Investments can lose value, just like collectibles from the Franklin Mint can lose value. Caveat emptor. Caveat vendor. Oh, and remember Daniel Drew's old saying:
"He who sells what isn't his'n
must buy it back or go to pris'n."
IN TODAY'S EDITIONS of The New York Times, food writer Mark Bittman -- who is a genius at cookery -- takes a look at the economics of meat. It may seem an odd subject to tackle, but Mr Bittman argues that Americans could soon change their views on the idea of eating meat for myriad reasons:
A sea change in the consumption of a resource that Americans take for granted may be in store — something cheap, plentiful, widely enjoyed and a part of daily life. And it isn’t oil.
The two commodities share a great deal: Like oil, meat is subsidized by the federal government. Like oil, meat is subject to accelerating demand as nations become wealthier, and this, in turn, sends prices higher. Finally — like oil — meat is something people are encouraged to consume less of, as the toll exacted by industrial production increases, and becomes increasingly visible.
I can't do justice to Mr Bittman's article through excerpts, so I would encourage you all to read it in full. That said, the summary points of Mr Bittman's essay are as follows -- the world's annual meat supply now stands at 284 million tons, and world meat consumption is expected to double again through 2050. However, raising animals for meet is energy inefficient, particularly when it comes to grain-fed cattle. More meat production will mean a higher demand for corn and soya feed, thus potentially impacting production of food crops:
Grain, meat and even energy are roped together in a way that could have dire results. More meat means a corresponding increase in demand for feed, especially corn and soy, which some experts say will contribute to higher prices.
This will be inconvenient for citizens of wealthier nations, but it could have tragic consequences for those of poorer ones, especially if higher prices for feed divert production away from food crops. The demand for ethanol is already pushing up prices, and explains, in part, the 40 percent rise last year in the food price index calculated by the United Nations’ Food and Agricultural Organization.
But these problems could be avoided, Mr Bittman writes, if people were to realize the supposed horrible effects of industrial farming. As he put it, "If price spikes don’t change eating habits, perhaps the combination of deforestation, pollution, climate change, starvation, heart disease and animal cruelty will gradually encourage the simple daily act of eating more plants and fewer animals."
That, of course, would rely on people seeing meat production as a problem. One doubts that most Americans will ever see that as the case. As prima facie evidence of this, I point to the impassioned lament of Mr Randy Taylor, a resident of the southern United States. Mr Taylor, as readers may recall, was quite aggrieved at news the makers of his favorite breakfast sausage had reduced their product sizes; so much so, that he called the company and left a profanity-filled complaint.
Given that, I don't even want to think how regular Americans would react if the nation's beef supply suddenly contracted and sent prices spiraling, and God help us if anything happened to the nation's critical supply of bacon. One can imagine folks would be pretty upset. But that doesn't mean they would change their habits. This is because most Americans see meat as a vital part of their diet, and the availability of it is more important than ancillary factors such as how the meat was raised, or whether growth hormones were used, and so on. Along those lines, if prices went up, people would still buy meat -- maybe of lower quality, maybe not as much -- but they'd still buy a lot of it.
For concerns about supposed animal cruelty and similar issues are chiefly the province of the upper and upper-middle classes, who can afford to feel guilty about their consumption. As such, they will pay extra to avoid feeling guilty about eating Wilbur the pig, who was cruelly slaughtered after a nasty, brutal and short life in some wretched, godforsaken industrial hog farm in South Carolina. But most Americans would not spare a second thought for the poor beast; they would rather dig in to the succulent, life-sustaining barbecue created from it.
Now let's look at the developing world, which Mr Bittman argues will be most at risk from increasing meat production, due to increases in the prices of corn and soybeans, which are used in feed.
I have my doubts that poorer countries would experience the "tragic results" Mr Bittman implies could result from ever-greater meat production. Yes, food prices are going up. Yes, many folks in the developing world are upset about this. That doesn't translate to famine and mass starvation.
It could, of course, if there was a price shock for all food staples. But what will most likely happen is that people will lower their consumption of certain high-priced foods (i.e., corn) accordingly and/or switch to lower-cost staples. We've already seen this in Mexico, where the poor are having a rough go of it due to high corn prices. For many poor Mexicans, the corn-based tortilla is their staple food, and corn now stands at $5 per bushel. I don't know what tortillas go for now in Mexico, but they had been going for between $1.36 and $1.81 per kilo last year. That was very expensive compared to historical standards, and that was when corn prices were not as high as they are now.
But is meat production behind this price rise? I haven't seen any indication it has had anything to do with the price shock in corn -- rather, ethanol production seems to be the real culprit. On the consumer end, the high price of oil also undoubtedly has helped push prices higher -- it takes oil to ship the stuff.
Quite frankly, when you take the combined effects of these two factors, would more meat production really have much of an impact in comparison? Not enough to make me think twice about ordering a steak.
OK, COUNT ME AS A LITTLE ANNOYED. If this story (and this story) in The Times of London are actually true, then America's precious nuclear secrets have been sold to Turkey -- Turkey, for God's sake -- for a mere pittance by corrupt officials. Yet our Government does nothing -- and in fact denies everything.
As a taxpaying American, this aggravates me to no end. Now look. I have no idea if this actually happened. But if it did, let me just say: I am not paying thousands of dollars each year to create, store and protect these secrets just so some lame-o bureaucrats can get money from their foreign paymasters. Thus, it would be nice if our Government would, you know, stop this and punish those responsible. Either that, or it could drop all the pretenses of having secrets in the first place.
That actually not might be a bad idea, now that I think of it. Instead of having secrets, we could invite our friends and allies -- oh, and France and China too -- to a giant auction each year. There, we would auction off our latest and greatest research to a select pool of approved buyers.
Just think of the billions of dollars we could reap from this, particularly if we got rich countries to bid against each other. Then, we could plow some of the proceeds back into research, thus coming up with even deadlier and more dangerous devices, and auction the new secrets created as a result. A few of these auctions, and we'd have all our Treasuries back from the Chinese before you could say Jack Robinson. Plus, we'd have plenty of work available for all our hard-working nuclear scientists, because they'd have to come up with counter-devices to guard against the secrets we'd sold. We could pay down our debts AND have a new cottage industry right here in America!
If we wanted to have some fun with the whole thing, we could sometimes auction off "secrets" that weren't really secrets, but were carefully designed misinformation. That would cause the buyers to waste years of effort and money on projects that had absolutely no chance of coming to fruition. If I recall rightly, we actually did that back during the Cold War, and it might not be a bad idea today. I would love to think that's what actually went on here, except that would mean our Government is brilliant and Machiavellian.
Anyway, I'm not saying, I'm just saying. It is, of course, a good idea for the Government to keep secrets when the secrets involve fissionable material. However, it doesn't do anyone -- much less hardworking, taxpaying citizens like me -- if the secrets are going out the door as fast as they come in. If this happened, maybe it might be a good idea for the Government to publicly do something about it.
SO I WAS ON Yahoo! Finance checking stock prices tonight when I clicked on one of their annoying personal-finance articles with the oddly ungrammatical headline: "Surviving 2008 for the Middle Aged." I don't know why just "Surviving 2008" wouldn't have cut it, but hey. Anyway, I skimmed the thing, which had Bold Predictions in it, such as a likely rise in the price of basic staple goods. (You don't say). But it was the last line that got me chuckling: "The bottom line: 2008 is a good time to reduce debt and sit tight while building your job skills."
Uh, I know I'm not helping here, but isn't it always a good time to reduce debt and build your job skills? I mean, really. It's not like calamity never befalls people when times are great and everyone's in a good mood because the stock markets have performed well -- it does. Speaking of calamity, I understand it's a good time to buy gold. It's always a good time to buy gold, as James Lileks has cleverly noted, based on hearing radio ads for the last two decades on that subject.
For that matter, it's always a good time to lose 15 pounds, start eating right, take long walks after dinner, spend quality time with your spouse, play catch with your son and clean out the garage. Oh, and it's always a good idea to not play around with electrical sockets, to not stick your hand in the garbage disposal, and to not antagonize angry caged zoo animals. Tune in next week when we discuss how it's always a good time to regularly change the oil in your car, eat five servings of vegetables per day and shower on a daily basis.
IN WHAT COULD PERHAPS be described as a really big "oops," French financial giant Société Générale has admitted a rogue trader managed to rack up some $7.2 billion -- yes, with a b -- in losses through bad bets on the futures markets. Somehow, the trader managed to conceal from his superiors the positions leading to the losses, despite reported employment of some 2,000 people in the firm's compliance office. The losses are so staggering that it wiped out much of the bank's yearly profit.
The man now accused of pulling this off is 31-year-old -- hey, he's my age! -- Jerome Kerviel, who bet wrong on "plain vanilla" futures positions reportedly worth some $60 billion. As for why he did it, no one knows. However, his trade union has speculated that perhaps Kerviel -- who earned less than $150,000 per annum -- may have been trying to boost his bonus package. The Daily Telegraph of Australia reports:
The trader had worked for the bank since 2000 and earned a salary and bonus of less than AUD 168,000. The bank said he netted no personal financial gains from his operations.
(Michel) Marchet of the CGT said his union was concerned that Kerviel may have been trying to get spectacular results as a way to boost his bonus, and added the system of bonuses for traders was "something we want to talk about with management."
"It's possible that he took positions with exaggerated risks, and when he had losses he tried to hide them - but with the stock market crisis, and an error that he seems to have committed, he was found out," Marchet said.
I mean, I don't know about you, but less than $150,000 seems awfully low even for a run-of-the-mill trader, especially when one considers M Kerviel was at the mercy of the French State each time he opened his pay packet.
M Kerviel was reportedly single and pulled down about 100,000 euros a year (about US$146,000). In income taxes alone -- at least, based on my calculations, based on this site -- he paid 38,583 euros on that salary and bonus. He paid 8,000 euros in social insurance taxes. We're now down to 53,417 euros. If we assume M Kerviel paid an overall rate of 16 pc for his VAT-based purchases (the rate varies from 5.5 pc to 19.6 pc) he's now down to 44,870 euros per year. And I haven't even gotten to the renter's tax, the television tax, or any of the other taxes the French Government has dreamed up, which are apparently legion. I mention all this not to indict the French tax system but to emphasize how little, at the end of the day, M Kerviel was drawing in pay.
All that said, consider -- this from no less a source than The Economist -- that a decent, furnished, one-bedroom apartment in Paris -- where the bank is based -- costs roughly 2,000 euros a month.
I mean, I'm better off than this guy -- and he's a trader! (I pay less than half that for my decent two-bedroom apartment in Manchester, N.H. Plus, given my line of work, I have no need to buy expensive suits, spend fancy evenings out on the town for work, spend an insane amount of money on coffee and croissants, etc.)
I do not, of course, condone M Kerviel's actions -- not in the slightest. It is one thing to screw up your own finances but when you screw up other people's finances, you have committed a grievous and unpardonable sin and must pay for it dearly, at least in my book. I'm just shocked that he got paid so little. When I say "little," I am not talking in absolute terms, of course, but in terms of the industry in which he works and the compensation which those in that industry draw.
One wonders if he was just spectacularly incompetent, or held in amazing contempt at his workplace, or what. But certainly it lends credence to the theory the man was perhaps facing financial problems and saw a large bonus as a way to fix those. Why else would he have done it, aside from insanity? A man does not slave away for eight years at a financial house because he wants to be the next Herostratus.
Strangely, M Kerviel has conveniently disappeared after word of this affair came to light. For reasons not entirely understood, his bosses did not separate M Kerviel's head from his neck, but instead allowed him to depart -- and before calling in the police. As The Telegraph of London reports:
Mr Kerviel is said to have admitted the alleged fraud after being confronted by his boss on Saturday, but the bank admitted last night that it now had no idea where he was.
Because the bank delayed calling in the police, Mr Kerviel still has his passport and may already have left the country.
If M Kerviel has indeed fled, that was probably a good idea, considering the legions of angry ex-coworkers who now would like nothing more than to dismember him. After all, he's probably now thrown their bonuses in jeopardy and as such would be as popular as bubonic plague. But there's no need to worry -- as the bank's chief executive put it, "He's not received a bonus this year, and probably won't be asking for one."
Well. Thank God for that. Although I would advise the Department of Homeland Security to keep a sharp eye out for M Kerviel. After all, in America, pesky issues such as "performance" and "return on investment" have no bearing on "compensation" in certain fields. He might have figured this out. He could be heading our way -- and quite frankly, we've got enough problems.
THIS IS TYPICAL -- ROUGHLY 23 seconds after I finally got comfortable with the idea of a prolonged downturn in the market, the market shoots up and all my positions shoot up with it.
Of course, I am not complaining about this. Not one bit. Like almost everyone else, I had a wonderful day on Wednesday, to the point where I nearly broke out in song at the office. (One of these days, I shall -- I daresay I'm close to having Monty Python's "The Money Programme" skit memorized, so that will be fun and exciting and draw weird looks from my coworkers, who are not as enthused as I am about business matters). I'm just saying I have an impeccable sense of emotional timing, that's all.
Now, the way I saw it (and see it), there was nothing inherently wrong with the downturn, even though I looked forward to its arrival the same way I look forward to having termites invade my apartment. After all, if we must have a downturn, let's get it over with -- let's flush out the wound, clean out the pus, cauterize it, and move on. Since I dollar cost average most of my investments, a downturn actually works to my advantage*, provided there's an eventual upside. Of course, there's always an upside -- we just don't know when it will come. So it thus made sense to keep doing what I was doing and then lie in wait for the inevitable switch in direction, allowing me to clean up on the back side. It is simple, and not all that risky, and it works.
Of course, it took me a while to get to this point. This is because downturns, in and of themselves, are not fun for long-term buy-and-hold investors like me. Sure, I could become a speculator and try to make money on the market falling, but given my capital and portfolio that is far too dangerous. Being young, I can tolerate risk, but at the same time that doesn't mean I should risk it on ventures in which I could suffer huge, capital-eating losses. So over the past few weeks, I found myself in the position of watching my positions slowly fall lower. Thus I entered the five stages of grief. And right at the moment I hit "acceptance," the Fed dropped rates 75 basis points.
No, really. At 8:04 a.m. on Tuesday, I sent out an e-mail saying something to the effect of "it's going to be a wild ride," based on the crazy futures reports we were seeing at the time. My exact words, in fact, were: "Getcha popcorn ready." Immediately after I sent this, the Fed dropped rates. Immediately.
Which I'm cool with, I would note. Like I said, I'm not complaining. That's especially because this could just be a hiccup on a long ride down into the cellar. If that's the case, I'd better start looking for bright sides again pretty quickly.
* This is because I'm able to buy more shares with the stable value of my periodic investments than if prices were high; when an upturn comes, those shares will consequently be worth more.
I WAS SCANNING The Rant's search logs this evening, looking for material for another Your Search Engine Queries Answered! survey, when my eyes stopped upon a fascinating query someone had entered: coinstar haram. From these two words, one can reasonably deduce what the questioner was asking: is the use of a Coinstar coin-changing machine, which charges users 8.9 cents per dollar of change converted, forbidden under the principles of Islamic finance, which prohibit the charging of interest?
The short answer is: I have no idea. I am, after all, a Roman Catholic. As a result, I am in no way qualified to judge whether use of a Coinstar machine is permissible under the Fiqh al-Muamalat. Thus, I would say to my questioner that he ought consult his local religious authorities for their view of the matter, have them make a determination accordingly, and follow their guidance.
After all, there are two sides to the coin here -- do pardon the pun.
On one hand, the Coinstar people are performing a service for the customer: they take possession of the customer's coins, store them at the site, transport them elsewhere, and deposit them for safekeeping. One could argue that in providing the customer with a voucher he can then convert to paper money, the Coinstar folks are providing a necessary service, and are earning just profit through doing so. Particularly since -- let's face it -- if you're using the Coinstar machine, you probably need money pretty quickly, and at some weird hour of the night.
On the other hand, the Coinstar people are charging 8.9 cents per dollar to take your coins and change them into cash vouchers. In the quarter ending Sept. 30, 2007, Coinstar processed some $767 million in its coin machines, according to its 10-Q form on file with the SEC. Yes, that's right. $767 million. We can thus deduce that through doing so, Coinstar had revenues of about $68 million just from those charges it levied (provided, of course, its charges are uniform). Thus, one could perhaps argue these revenues are the product of interest, as Coinstar is charging its customers 8.9 cents per dollar because of the convenience, i.e., the time value of money, it offers to customers. (You can have your money now, and the company gains; or you can wait until the morning and change it somewhere else). This may be fine for decadent Westerners but not, perhaps, for observant Moslems.
As I said, however, I take no position on the religious implications of using a Coinstar machine. Such questions are clearly best left to others. I would note, however, that these questions may be avoided entirely through going to one's local bank and using their coin-changing machine, as many banks offer coin-changing services free of charge. Not only does that leave you free of any spiritual guilt, it leaves you 8.9 cents per dollar richer. And that adds up.
(CLEAR-AS-MUD FOLLOW-UP: If there is a charge at your bank, it may be so low as to actually qualify as a pure service -- if the charge is so low as to simply represent the cost of the machine and its operation. For instance, my local credit union charges just three cents on the dollar to change coins, and I figure that probably pays for having the coin-counting machine in the lobby and someone to empty it each night. I am pretty confident my credit union is not making money on the thing, which looks expensive. However, I am not sure that is the case. Further, as this whole digression is opening up another can of worms, I would caution my questioner and my Moslem readers that the answers to these questions are best served through obtaining spiritual counsel).
WHILST SURFING THE INTERNET, I stumbled across the Web site of a rather inventive musician, who has come up with a novel way to raise funds for her next album: she’s soliciting donations from her fan base. Jill Sobule, our musician, hopes to raise some $75,000 for the effort, and is more than one-third of the way towards her goal. In return, her fans get a variety of benefits, ranging from advance copies of the disc in question (for $25) to free admission to her shows ($200) to having her show up and perform in concert at a fan’s house ($5,000).
RIGHT BRAIN: Wow, what a cool idea. Fans can support one of their favorite artists and they’ll get to be part of the experience, and –
LEFT BRAIN: Fuck that, I want equity.
RIGHT BRAIN: Wretched cur! How could you so harshly taint an artist’s love with crass thoughts of commercial profit?
LEFT BRAIN: Idiot! Go buy the world a Coke! I’m trying to calculate here.
RIGHT BRAIN: But don’t you see you would help create a work that would last the test of time? A work that would launch important ideas into the eternal soul of mankind?
LEFT BRAIN: What good is it if the work doesn’t help me reach my goal of not working? Ooooh, a liner note! I’m sure I’ll remember it when I’m working as a Wal-Mart greeter at 90!
RIGHT BRAIN: Dammit, just once I want you to recognize the importance of art!
LEFT BRAIN: Art is important because it means the rest of society is working and actually making useful goods and offering useful services, thus allowing people to buy it!
RIGHT BRAIN: Filthy capitalist running dog!
LEFT BRAIN: Goddamn pinko hippie!
RIGHT BRAIN: Running dog!
LEFT BRAIN: Hippie!
Soon, however, the two halves of my brain came to a compromise, and so I thought: this would be a great way for an artist to both raise money and connect with his fan base, but why should the artist get all the upside yet none of the downside? After all, if the album is a huge success, why should the artist reap all the dough while I get a liner note?
As it turns out, however, our artist DID look into that question, but concluded there were issues about risk-and-reward sharing, viz. and to wit: “We looked into that possibility, but concluded that it could get very complicated very fast. The recordkeeping overhead, the legal and contractual requirements, the potential SEC implications -- it's just more than we could reasonably handle. We want to make a record, not start General Motors.”
This, to me, is a problem, because she’s right – especially regarding the SEC. After all, in this day and age, to make an honest-to-God investment-funding scenario from a fan base work out, you’d have to sell stock. You’d also have to register it with the SEC and your state securities regulators -- unless you restricted the buyers all to one state, and then you’d have to still deal with your state securities regulators.
Of course, it’s worth noting why these regulatory requirements exist, because many people aren’t as financially savvy as one might hope. Vast sums of money are wasted each year on dodgy oil-and-gas investments; pyramid schemes and nonexistent companies dreamed up in boiler rooms and chop houses; outlandish insurance products; get-rich quick scams; odd personal-enrichment and money management seminars; and my personal favorite, those infomercials on television showing you how to become wealthy using a variety of strange tactics that seemingly require the expenditure of money. Oh, and season tickets to see the St. Louis Rams. Yeah, can’t forget that one.
Still, it is frustrating to think people are kept away from a potentially promising venture just because other people get duped. After all, why shouldn’t people who aren’t accredited investors (that is to say, rich, under the SEC’s definition) be allowed to invest in such ventures? It’s not like people without bunches of money are stupid.
Of course, I say this realizing that the potential for profit in a musical venture is very small, just by its nature. The business of producing a record is understandably fraught with peril just on its own: a recording company must spend money producing and manufacturing an album, and then must spend more money on promotion and various other expenses, and then must spend even more money to handle all the administrative work associated with it. Since the music market is so unpredictable, it stands to reason that many of these efforts are unprofitable, and that unprofitable albums receive an effective subsidy from profitable albums as a result. After all, you don’t think the recording companies screw over their profitable artists just for fun, do you? Well, maybe they do, but the whole “keeping the lights on” business is also a likely incentive.
Still, it seems investors can be easily advised about these affairs: for instance, through the prospectus, which can tell prospective investors of the SIGNIFICANT AND ALMOST CERTAIN RISK THEY’LL LOSE THEIR SHIRTS ON THIS BARMY, COMPLETELY MAD IDEA. Hell, put it in bright red ink if you must. But that should be enough protection for people who are going into the deal without the seasoned investor’s knowledge that any such venture will almost certainly fail. Because it will: that is the way of the world.
But one does not fund these things solely for commercial gain. For instance, a very good friend of mine is in a very good band – one that definitely has “breakout potential” and has a better chance than most to actually make it. Why the hell shouldn’t they be able to raise money in this way? For that matter, why shouldn’t I be able to chip in a bit to their efforts if I want to do so? I like them, and they make good music. It’s not like I’d expect to get any money back, much less an actual return on investment. But it sure would be cool if I did.
So my idea is this: we legislatively create a new type of corporation, out of whole cloth, for creative types, and allow these people to raise money for artistic endeavors. For artistic endeavors at their core are business endeavors, whether anyone wants to admit it or not: they are simply part of the quaternary sector of the economy. The firms would have extremely limited capital-raising abilities -- $100,000 seems a good maximum – and could sell shares to the general public. The amounts purchased by non-accredited investors could be limited, perhaps to say $500 or $1,000 per non-accredited investor, in order to prevent anyone from really losing a bunch of dough. The issuer of said shares would have to provide a prospectus detailing the work or product in which investors would hold shares, and how returns would be calculated and distributed. They would have to provide relatively reasonable financial statements (nothing fancy) and could incorporate in a single state, but draw investors from all states. We could call it a Limited Liability Creative Corporation.
Thus, Band X which sought to raise $20,000 to produce and distribute an album could perhaps sell shares entitling shareholders to 75 percent of the take on said album. If you figure a CD goes for about $10 these days, it would take perhaps 2,700 copies for the investors to realize a profit. But an LLCC wouldn’t have to be music-related: it could be book-related or art-related or what not. Even better, the combination of helping out a creative type you like AND the possibility of an actual return could result in greater gains and more artistic output than simply getting a thank you in very, very small print.
The above video is an extremely profane parody, apparently made in the late Seventies, of a public-relations advertisement for AFSCME, the American Federation of State, County and Municipal Employees. It is also riotously funny. If you watch it -- and you should -- do watch it at home, or with headphones at the office. Did I mention it was extremely profane and riotously funny? OK, you've been warned. Especially if you're a mid-to-senior level executive who still has a thing for Seventies-era fashion.
SORRY ABOUT THE ABSENCE. Between an emergency room visit on Saturday night, and the recuperating from the issue that sent me to the emergency room, I haven't exactly been in a blogging mode. You know, because I've been weak and in pain and what not. But I will be back soon. For those of you unfamiliar with what sent me to hospital, here's a helpful video to show what I've been through. Well, except the "falling from a tall building bit." Oh, and it didn't involve my knees. But still, it's a good approximation:
Long story short: it was serious, but not too serious, and I'll be fine. Happy landings, everybody!
UH, SO IT TURNS OUT a former Congressman -- who once represented Michigan's 6th Congressional District, where I grew up -- has been charged with helping an "Islamic charity" funnel money to al-Qaeda in Pakistan. No, really. That's what the Detroit Free Press says:
A former Republican congressman from west Michigan was indicted today on federal charges of money laundering, conspiracy and obstruction of justice in a scheme to assist a U.S.-based Islamic charity organization funnel money to Al Qaeda and Taliban-linked terrorists in Pakistan.
Mark Siljander, 56, also a former state legislator from St. Joseph County, was hired by the Islamic American Relief Agency in 2004 to assist in having the group removed from a U.S. Senate list of terrorist-linked charities, according to a statement released by the Department of Justice, then helping the group launder stolen federal funds with which to pay for his services. ...
Siljander served five years in Congress beginning in 1981 when he was elected to replace David Stockman, who had been hired as President Ronald Reagan’s budget chief. He was defeated in a re-election bid in 1986 by U.S. Rep. Fred Upton, R-Kalamazoo, following a well-publicized incident in which Siljander sent an audio tape to church pastors in the district urging them to fast and pray for his re-election to “break the back of Satan.” Today’s indictment describes Siljander as the owner of a company called Global Strategies Inc., based in the Washington D.C., area.
OK, the whole "re-elect me and I can carry out my delusional messianic ambitions" bit? As someone who grew up in western Michigan during the Eighties, this does not surprise me. The "help fund America's enemies for one's own tawdry personal gain" bit -- well, that does.
UH, WHERE'S THIS YEAR'S "Time to Get Your Story Straight" Commercial? C'mon, dammit! Get to work already! We're waiting! It's not like there's a shortage of material or anything.
I'M NOT GREEDY. All I want is $1.3 million.
In saying that, I do realize the reactions which will accompany such a seemingly outlandish statement. After all, Loyal Rant Readers will shake their heads and say, "Ben, what do you want with $1.3 million?" For $1.3 million is, even in this day and age, a whole heck of a lot of money. For that matter, I'd be perfectly happy if smaller amounts were to suddenly fall into my lap, such as $130,000. Or $13,000. Or $1,300. Hell, $130's enough for three good steak dinners, and believe you me, I would be psyched as all get out to discover an extra $130 in my wallet or my sofa cushions or my sweet NFL change bank or what have you. And $13 would buy me four gallons of gasoline and who could complain about that?
But I still want $1.3 million.
Why, you ask? Because that, my friends, is My Magic Number: the amount of money that, given my lifestyle, would make me Fully Independent and Accountable to No Man. As a result, I could do everything I've ever really wanted to do: travel, live someplace warm, write the great American novel and lounge on the beach all day. Not only that, I could do so on my own time and my own schedule, instead of having to arrange these things around inconvenient realities such as "work" and, well, "work." Were I ever to reach my Magic Number, I could do all these things and still have my $1.3 million last into perpetuity, which would give me a hell of a spring in my step, without having to rely on the Government or my Corporate Paymasters or what not.
The trouble is: how do I get $1.3 million salted away? What if I don't manage to do it -- will I be working until I'm 90? And do I really need $1.3 million to achieve a lifestyle worthy of having $1.3 million in the bank?
Well, the answer to the first question seems pretty clear: save, and save as much as I can. I like to think I'm doing this already, although I could probably do more. But let's say, for the sake of argument, that I'm not able to get to the magic number through savings alone. What I need is the equivalent of $1.3 million, at least in terms of the $1.3 million's income power.
If you ask me, this is the great slip-up when it comes to thinking about retirement and magic numbers and all that. It might be nice to have all that money in the bank, but people really don't necessarily need it, particularly if they've got pensions or 401(k) company matches or what have you. Plus, unless our Government officials want to end up like Rostenkowski, they'll pay out Social Security benefits even to us young folks who now view the program as a giant sinkhole. (Which it is, but in fairness, it could have been a hell of a lot worse).
I recently ran the numbers for my own personal retirement and found, much to my shock, that the age-62 payouts for retirement under my pension scheme and Social Security would account for nearly two-thirds of my target income in retirement. I was so stunned that I double-checked the numbers, but they worked out. Suddenly, My Magic Number has been downshifted a bit -- from $1.3 million to $292,154. That's the price of an immediate annuity payable for life at age 62 with a premium guarantee (thus eliminating the downside risk in the event I get run over by a cement mixer six days after signing the contract).
Suddenly, this whole "retirement" thing seems a hell of a lot more doable -- especially because getting that $292,154 should be pretty easy.
But wait, you say. What about that most pernicious of evils, the doom of men, the grim spectre, the rider upon a pale horse? Yes, of course -- inflation! Surely that must be worked into your calculations, right? Well, I hadn't gotten to that point, but let's review it.
If we assume that inflation will be at a manageable level over the next 30 years or so -- essentially a continuation of American monetary policy since 1984 -- then we can deduce it will take 2.4 times the amount of money to buy thirty years from now what we can buy today. Thus, my $292,154 works out to $701,169 -- which is considerably more than I had hoped. But it's still not $1.3 million. The good news, though, is that I can still hit that inflation-adjusted number if I keep saving throughout my thirties and get a decent rate of return on my investment in future.
The lesson from all this? You might not actually need as much as you thought you needed for retirement, especially if you factor in things like long-lost pensions and Government aid and -- one factor I specifically left out -- your prime nest egg, which for most Americans is their house. This works both ways: either you pay off your mortgage, thus reducing your outlays in retirement, or you draw from its equity during your retirement, which if you ask me isn't exactly a bad tradeoff. Ideally, you could do both with a reverse mortgage, provided housing valuations are high. Of course, I don't own a home yet and have based my assumptions on the fact I'm a renter, but that's something to consider as well.
Admittedly, I've also based my assumptions on the fact my life stays exactly as it is now, which is a bit fraught with peril. I could get married and have children, which would throw those assumptions out the window entirely, and the end result could be markedly different than what I've laid out here. But it's a start, anyway -- and even if I don't get my $1.3 million, we all need something to shoot for in life.
I LOVE THE PLAYOFFS. How wonderful was it to see the San Diego Chargers knock off the Indianapolis Colts on Sunday? I mean, it would have been pretty lame if we'd been stuck with another New England-Indianapolis AFC Championship game. But somehow the Chargers overcame the loss of their starting quarterback, their star running back, AND the Curse of Norv! to defeat the Colts, 28-24. Cut that meat! Cut that meat!
You know, somewhere in Cleveland, I think a Browns fan just cracked a smile.
Speaking of Norv! -- boy, I thought Tom Coughlin looked like an idiot on the sidelines, but Norv! takes it to a whole different level. When you see Coughlin on the sidelines, he usually has this uncomprehending look on his face that suggests he can't understand how or why Rocket Arm Junior has thrown yet another interception. Norv!, however, looks like a commodities trader who goes home for the weekend down-limit on his big pork-bellies position, and is hoping -- begging -- praying -- for things to turn around. Somebody get this man some Pepto, and quick.
But they turned around on Sunday, didn't they? Of course, God help the Chargers when they go to New England next week, because the Patriots will eat the Chargers and Phil Rivers alive. Speaking of, I take back for the moment what I said about Tom Brady being a candyass, because Phil Rivers is clearly most deserving of the Quarterback Candyass title. Plus, Brady has not been whining as much during his games.
Speaking of Coughlin, for that matter, I guess I have to take back at least a little of what I said about the man, because his team DID knock off the evil Dallas Cowboys and DID make Terrell Owens cry and thus DID make the upcoming NFC Championship game interesting and DID potentially set up a great storyline for the Super Bowl with their win. Now they just have to knock off Green Bay. Heh. Good luck with that. Although I do think the Giants are playing well enough to do that, even while playing on the frozen tundra of Lambeau Field.
Also, I realize I'm late to the party on this, but a drink's on me for whomever came up with the "Yoko Romo" tag for Jessica Simpson. HAHAHAHAHAHAHA. She's never going to live that one down!
So I guess I'll be rooting for the Giants and -- well, I suppose, New England -- during the game this week. Since my Super Bowl loyalties are strictly conference-based -- the AFC must defeat the second-rate NFC, no matter what -- I'm going to have to root for the Patriots. After all, the power of the Curse of Norv! can't be underestimated.
... 'CAUSE THEY'RE FROM O-HI-O. Er ...:
BOY, NO WONDER Ohio State's lost two national championships in a row. Oh, well. God willing, it won't matter next year because Michigan will have Coach Rod! and a whole new stable of up-and-coming players who will dethrone Evil Sweater Vest and his Barbarian Legion.
(photo via The Lee Bockhorn)
DURING THE SHORT REIGN of Emperor Julian the Apostate (360-363), the Emperor found himself facing one of the innumerable financial crises that plagued the Late Roman Empire, and decided to take strong action to stop it. Like all emperors during the waning days of the Western Empire, Julian was faced with a weak, inflation-hobbled economy; a situation that resulted from the debasement of Rome's currency.
Now in those days there was panic in the markets at Antioch. Due to inflationary pressures, the price of grain had skyrocketed and the multitudes of that city suffered grievously. Julian, according to researcher Bruce Bartlett, thought the problem was not based in the Government's actions, but rather the unseemly and selfish actions of Antioch's merchant class. With the price of grain extremely dear, Julian figured he would shock the market and released all of his grain into it, in the hopes it would lower the price of the commodity. It did not work: the town merchants bought all the grain, the producers saved their stocks for a rainy day, and afterwards it was as if the Emperor had done nothing.
Julian was not pleased at this, and ruefully blamed all concerned for acting in their own self-interest. But then, one could not blame them for doing so: after all, they clearly recognized Julian's grain infusion was a short-term, one-off affair that would not be repeated. That said, although Julian was a bit of a bastard, one could not blame him for at least trying to alleviate the people's suffering.
Also, Julian had an excuse: he was living in the fourth century, and it was not for many centuries afterwards that people started to get a handle on economics as a science. For instance, people didn't start figuring out inflation until the 16th century, and it was not until last century that people started figuring out demand-side and supply-side economics. However, human nature does not change, and so it should be no surprise to learn The Powers That Be are channeling Julian in their latest attempts to solve our current economic troubles.
As Loyal Rant Readers may have heard, our current economic troubles have prompted the Government to float the idea of an Economic Stimulus Package. Since it is an election year, one can assume both parties in Government will work feverishly to advance their ideas accordingly. Furthermore, given the political pressures resulting from the upcoming election and the perils facing the American economy, it stands to reason any "stimulus" will contain measures agreeable to everyone. Thus, it seems likely a stimulus will contain: a) a temporary tax rebate, i.e., checks in the mail to the American people; and b) additional Government spending.
Of course, one can quibble over both these options. The temporary nature of a tax rebate means many who receive it will act like the farmers around Antioch -- they'll just save the money they get as a protection against future calamity. Additional Government spending -- if it is "traditional" spending on works projects and what not -- will largely go to the well-connected, just as Antioch's merchants bought all the grain; and although that might boost the fortunes of a few, it probably won't have a really big impact because the overall problem is so large. And if the Government spends its money on programs helping the less fortunate, it will have the same impact as a tax rebate -- the people who get more food stamps, for instance, will undoubtedly save more cash as a result, if they can do so.
So while one must give the Government points for trying to alleviate the problems facing the American economy, one cannot expect much success no matter what comes down the legislative pike. As Ambrose Evans-Pritchard has noted, the collapse of America's housing bubble has destroyed $2.5 trillion in wealth -- a sum nearly equivalent to the Government's entire budget. Thus, even a generous stimulus package will do little to make up for that. The only people who can save us now are the central bankers.
The good news, though, is that the central bankers have been working on this -- in concert with other top officials in the Government. Apparently, there's some secret working group that can take drastic actions to yank the markets up by their suspenders. As Ambrose Evans-Pritchard writes:
It appears to have powers to support the markets in a crisis with a host of instruments, mostly by through buying futures contracts on the stock indexes (DOW, S&P 500, NASDAQ and Russell) and key credit levers. And it has the means to fry "short" traders in the hottest of oils.
HEY, MUSICIANS! Uncle Sam wants YOU -- yes, YOU -- to provide Our Boys serving abroad with Musical-Themed Entertainment! Not only will you get to meet interesting people, visit new and exciting places, and generally rock out with the enlisted men, you'll actually get paid -- in actual U.S. dollars!
Professional Celebrity Rock Music Band, group not to exceed seven people for tour of FOB's in Kuwait and Afghanistan for February 4-13 2008. The band should be an active rock band, with a music genre consisting of Southern Rock, Pop Rock, Post-Grunge and Hard Rock. At least one member of the band should be recognizable as a professional celebrity. Protective military equipment, such as kevlar, body armour, eye and ear protection will be provided when the group is travelling on military rotary or fixed wing aircraft.
Interested bands should remember to pepper their applications with plenty of military lingo: for instance, note how their MTE, as part of an MST, will result in a non-SFUS even if everything gets FUBARed. But remember to use Army acronyms! If you screw up and assure the Army there is no way BUPERS will have to deal with the ONI as a result of your visit, they will wad up your application, stomp on it, and then throw it in the trash. So be vigilant!
Also: note that Today's Army is Not the Army of the Seventies, when you could get away with all sorts of wacky shit.
BOY, 2008 IS TURNING OUT to be a great year so far! Let's review all the good things that have happened:
* Michigan beat Florida in the Capital One Bowl.
* The Pittsburgh Steelers were in the NFL playoffs.
* The New Hampshire presidential primary means more work, which means more money, for me.
* I just got new kitchen appliances for my apartment today.
Boy, these appliances are sweet, too. One of the advantages of living a pretty modest lifestyle is that it's easy to get used to it, thus making unexpected upgrades to that lifestyle a welcome surprise. My old refrigerator, a Westinghouse model I think was built sometime during the Carter administration, was swapped out for a slick new 15.7 cubic foot frost-free fridge with bunches of clever features, such as an interior door shelf that holds 12 cans of soda. Maximum sweetness.
Oh, there's the other major benefit too -- this fridge is far more energy-efficient than my old one, meaning it will cost me about $5 per month to power. This should thus knock off anywhere from $5 to $12 monthly from my power bill -- and perhaps more, if my old fridge really did date from Carter. (Although I don't think that was the case. My apartment building was built in 1982 -- anyone who has visited me knows it has that vague late-Seventies feel to it -- and so I think that's when the appliances were bought.)
Anyway, I also got a new electric range -- sweet -- which has a self-cleaning oven and generally kicks ass. My old range was a bit underpowered and could be a bit slow at boiling water and baking things; this new one is clearly more efficient and has clever design features, such as a top that lifts up for easy cleaning. This will work.
I found out I was getting new appliances on Saturday, although I never really learned why. I figured it was a combination Tenant Retention/Tax Purposes move, though. After all, buying appliances means my landlord can depreciate the cost of them over the next several years, and given the age of the older models it was probably a good idea to turn them over before the old ones finally gave up the ghost. Plus, now that I have new appliances AND a new conditioner -- Loyal Rant Readers may remember my joy at that -- my landlord has taken strong action to ensure I'll be here all the way through the housing crisis, which I figure will wrap up in 2010 or so. Since I'm quiet and I pay my rent on time, this is good for all concerned.
Oh, and did I mention my new fridge has a door shelf for soda? Sweet. Sweet. Sweet.
IF YOU EVER WANT to find out whether your new neighbor or coworker from California is an economic refugee from the Golden State, just ask him what he thinks of the state's capital. If various expletives are used prior to or following the word "Sacramento," you'll have a pretty good guess. Although people living in California generally view their famously worthless and corrupt Government with contempt and scorn, those who no longer live there generally place it one notch below cholera in terms of the things they'd prefer dealing with in life.
Well, now the geniuses in charge of California have come up with yet another scheme to make life in the Golden State intolerable. It's bad enough they screwed up deregulating the state's electricity market, but now they're going to directly put the burdens of their incompetence on California homeowners, viz. and to wit:
What should be controversial in the proposed revisions to Title 24 is the requirement for what is called a "programmable communicating thermostat" or PCT. Every new home and every change to existing homes' central heating and air conditioning systems will required to be fitted with a PCT beginning next year following the issuance of the revision. Each PCT will be fitted with a "non-removable " FM receiver that will allow the power authorities to increase your air conditioning temperature setpoint or decrease your heater temperature setpoint to any value they chose. During "price events" those changes are limited to +/- four degrees F and you would be able to manually override the changes. During "emergency events" the new setpoints can be whatever the power authority desires and you would not be able to alter them.
In other words, the temperature of your home will no longer be yours to control. Your desires and needs can and will be overridden by the state of California through its public and private utility organizations. All this is for the common good, of course.
For the full story on this latest brilliant idea, visit the American Thinker, which has a big story about the proposed regulation. What makes the story really amazing, though, is that the proposal for this came out of Sacramento, which last time I checked was roughly six degrees cooler than hell itself during the summer. For that matter, most of California is just a few degrees cooler than hell itself during the summer.
Thus, this proposal is completely insane. The last thing the long-suffering people of California need is for the technocrats in Sacramento to start deciding what allowable interior temperatures will be, particularly if some of those people have weak constitutions or otherwise need their homes rather cool. There's no way individual situations can be accommodated in a one-size fits all demand-restriction scheme.
Of course, demand issues wouldn't be a concern if California had adequate power supplies. Making the supplies adequate means building power plants. Although plenty of people in California hate the idea of having a power plant next door to them -- or within 100 miles of them -- there is a solution to this. Namely, put the stupid plants out in the desert.
There are vast swathes of desert in eastern California and they are perfect spots for power plants -- even nuclear power plants. It's understandable that people in Santa Barbara don't want a power plant in their neck of the woods. People in Barstow, however, would probably be down with one. Hell, you could put a nuke plant in Needles and even if the thing blew like Chernobyl nobody would notice for days. What's that? You think I'm joking? Have you ever been to Needles?
TOURIST: I didn't realize they had casinos in Needles.
LOCAL: Uh, we don't.
TOURIST: Well, what's with the neon blue glow around everything?
LOCAL: Oh! That's part of our celebrations for the Needles cactus festival!
TOURIST: No kidding?
LOCAL: Yeah! We do this every year!
TOURIST: On a Tuesday?
LOCAL: Yes! The second Tuesday in April! Yeah, that's the ticket. I'll ring that up in a minute for you, I've got to get my containment suit -- I mean, my special ceremonial Indian craft handling suit -- ready.
TOURIST: Well, that makes ... hey! Wait a minute! Isn't there a nuclear plant around here?
LOCAL: It's only a model.
SECOND LOCAL: Shhh!
Anyway, my point is clear: California needs power but doesn't want the plants producing it near people. There are millions of acres of empty space out in the desert: space now home to sand and rocks. Problem solved, and solved without having Sacramento keep your house at 80 degrees at night.
SO THE QUEST for "one for the other thumb" will have to wait another year. We'll survive. All things considered, it wasn't a bad season -- and the Pittsburgh Steelers will be back. Oh, yes. We will be back.
THE QUEST FOR FAME has its roots in antiquity. Witness the rash act of Herostratus, who on July 21, 356 BC, burned down the Temple of Artemis at Ephesus for the sole purpose of having his name remembered in history. Although the people in charge of Ephesus were nearly successful in thwarting Herostratus' scheme -- not only did they execute him, they pledged to execute anyone who so much as mentioned his name. Unfortunately some ancient historian recounted the entire affair and so we know of Herostratus' plot today.
Well, some 2,363 years and change later, we have a new Herostratus -- Mr Richard Arens of oil trading concern ABS. According to media reports, Mr Arens purposely bid $100 for an oil futures contract so as to be the first one to bid $100 per barrel for oil, viz:
"The magic figure was hit apparently on the back of a single trade, rumoured to be a local intent on fame," Sucden analysts wrote in a commentary Thursday on the record breaking deal.
Arens offered 100,000 dollars on the New York market on Wednesday for 1,000 barrels of oil, producing the much talked of 100 dollars per barrel which sparked anguish across the financial markets.
He later sold on the contract for slightly below 100 dollars, taking a 600 dollar loss.
"It was just for the form; he wanted to be the first in the world to buy oil at 100 dollars," said Antoine Heff, an analyst at NewEdge.
The new price record came as a shock to the markets although many had been saying 100 dollars was inevitable at some point given strong demand and supply constraints.
Oil slipped back slightly but hit 100 dollars again on Thursday.
On Friday, profit-taking pushed the price back again, with quotes in late Asian trade of 99.23 dollars for New York's main contract, light sweet crude for delivery in February.
Thanks, Richard Arens! THANKS A LOT! After all, now that oil has finally broken through the psychological/ technical barrier of $100 per barrel, there's no reason why it won't continue to keep rising as speculators continue to squeeze the futures contracts for every penny they can get. (OK, so that's what they do. I don't care. It's affecting my positions negatively, so I hope they rot in hell).
Meanwhile, we're all stuck paying more than $3 per gallon for gasoline because the gasoline futures are moving in line with the oil futures, and it sucks. Even worse, the high price of oil will undoubtedly continue to eat away at the equity markets, thus driving down returns and making average investors skittish, and before we know it the economy could be mired in a recession. What's that, you say? Surely the markets wouldn't react that way to a stunt trade? Ha! If a hot dog vendor outside the New York Stock Exchange ran out of soda at lunch, somebody would short PepsiCo within five minutes, and just because they could.
Yes, I do realize oil futures would have almost certainly hit $100 anyway, but that's not the point. The point is that Captain Nefarious here purposely kicked it off, and it was a real jerk move. I hope the guy ends up down-limit on some huge contract he went all-out on margin for, and he gets a margin call, and his creditors send forth swarms of officers to harass him and eat out his substance.
Oh! That reminds me. Short cotton*, because the commodities exchanges are going computerized, which means a whole bunch of the floor traders will eventually have to find other work, and there won't be near the demand for those funny-colored sport jackets they wear. You heard it here first!
* Don't even think about doing it, even if you want to. Just don't. Put your money in an ETF or something. Crikey.
SO THIS EVENING I got a call from the nice people at the Gallup Poll wanting to know who I was supporting in the New Hampshire Presidential Primary. Normally, I would not have answered the call -- I don't answer the phone if I don't recognize the telephone number -- but I did this evening just because I wanted to hear the pitch I'd get.
As it happened, a nice lady from Nebraska was on the other end of the line and wanted -- oddly -- to speak with the person 18 years or older who had most recently celebrated his birthday. After looking around, I realized this person was me. However, before my questioner could get any farther, I interjected and said that my line of work prevented me from taking part in any polls. Given my line of work, this generally results in the pollster saying, "Thank you," and me saying, "Good night."
Not tonight, though. Much to my surprise, my questioner said this didn't matter at all -- which kind of floored me. I mean, I'm sorry, but there are 400,000 people expected to vote in the primary. Surely the Gallup people would want a "civilian" taking part in their survey. But it was the next line of questioning which really made me chuckle -- don't you, the pollster asked, want to voice YOUR OPINION about the race? Well, not really, no.
At that point, I realized New Hampshire's really starting to rub off on me. Not only did I not want to give my opinion to some pollster, I wanted my opinion to be a goddamn surprise on primary day. (At least to the world at large). That said, I daresay the best reporting on the presidential primary so far comes from none other than Dave Barry, who writes:
And so the eyeballs of the world turn to New Hampshire, a tiny, flinty, gritty, Dunkin' Donuts-intensive state located mostly inside the Arctic Circle. On Tuesday, the voters here will troop to the polls, where -- as they have done every four years since 1952 -- they will turn around and troop back home, because the polls, like virtually everything else here, are under 23 feet of snow.
But a few people, the truly flinty ones, will manage to actually vote, and they will determine the course of this presidential race -- and, yes, America's future -- for approximately two news cycles. Then the eyeballs of the world will turn to either North or South Carolina (nobody is sure which) and the people of New Hampshire will go back to their traditional flinty New England lifestyle of sitting around eating doughnuts and waiting for the August thaw.
"Dunkin' Donuts-intensive." Heh. YOU HAVE NO IDEA. I mean, they have locations in HOSPITALS up here.
Perhaps it's warranted, actually. Although the company does sell donuts, few people around here really seem to go for them. It's the coffee, made with the finest arabica beans and a healthy dose of stimutax, that people demand -- to the point where if the world ends anytime soon, Dunkin' Donuts coffee will prove more valuable than gold, more sought after than penicillin, and more fought over than canned goods.
Fortunately, as a transplanted Midwesterner, I am immune to these temptations. This is good, because in the event of a disaster, I'll be able to stock up on the stuff and make a mint. Admittedly, the whole "world-ending" disaster thing might put a crimp in my scheme to profit from any shortage, but I'd still be able to do all right with my idea -- after all, I'd need to have something to barter for my Diet Cherry Coke. I may even start stocking up now. With the way the market's been, buying Dunkin' Donuts coffee beans would probably deliver a better return than any of my other investments.
STEVE CARELL? As Maxwell Smart? I am so there. I just hope they haven't screwed things up too much in making the Updated Adaption From an Old Television Show, which is always Fraught With Peril. I mean, the show was so great because it was so silly. Maxwell Smart heading up the secret agents' union? KAOS establishing the secret POW camp in South Jersey? Approximately eight million running gags? Genius. So I hope they've kept to that somewhat in making the new film.
AS ONE OF ABOUT THREE Americans who find economic data really interesting, I have to point Loyal Rant Readers to some spectacular work which blogger Afferent Input has done regarding U.S. income inequality. Our anonymous blogger has created some really clever charts which show income inequality trends from 1979 to the present.
Those readers who keep an eye on these things -- and who have read my various posts over the years on these issues -- won't be surprised to find out income inequality has risen over the past three decades. America's Gini coefficient is up somewhere around 0.46 or so, up from 0.40 in 1980, and that alone gives you the gist of how things are going. Still, the charts Afferent Input has produced show pretty clearly the top one pc of American households are holding an ever greater share of the nation's wealth.
Along those lines, the top 10 pc overall have increased their shares of the pie, while everyone else holds correspondingly less. The poor and working class have seen their share fall some 30 pc over that time, while the lower-middle class and middle-class have seen their respective shares fall about 20 pc. Interestingly enough, this phenomenon even reaches into the upper-middle class, with those in the 80th to 90th percentiles also losing out.
Now this is, of course, the type of data that causes much wailing and gnashing of teeth when it is released and examined. After all, the idea of rich people becoming richer doesn't tend to sit well with people who aren't rich, particularly when the non-rich are facing all manner of economic calamities. When the upper-middle class are facing higher tax bills and school costs, and the middle-class are getting their benefits squeezed, and the lower-middle class are getting laid off, and the poor are stuck making eight bucks an hour, they're not exactly going to pull for the rich guy hoping this will be the year he hits the $30 million mark on the odometer. These reactions are all perfectly understandable.
However, I would caution this is the type of data you have to peel back like an onion if you want to get at the underlying truth. Plus, you can't look at it in a vacuum if you want to get an objective reading on the economic situation.
If you go take a look at the charts, you may well notice the spikes and dips in the top one pc's share of the national wealth mirror the performance of the financial markets. That makes perfect sense: it is easy to reap a lot of wealth when you have a lot to sow. When the markets do well, the rich benefit accordingly; when they do poorly, their share of the pie falls in commensurate measure to how the markets react.
Charts like these also don't factor in social mobility. Since their underlying data is a collection of snapshots in time, they don't account for the fact that the student who in 1979 was eating ramen noodles and driving an old Rambler American is now the prosperous division head of some million-dollar corporation, or the fact that today's twenty-something retail worker wasn't even a gleam in his father's eye back when the data series started. True, there are undoubtedly some workers who have remained stationary in their careers since the series started, but certainly those are in the minority of American workers.
Income charts are also tricky because they don't factor in other things, most notably personal wealth. But they also don't factor in real income -- by which I mean disposable personal income, the net income of Americans after they pay the Government their taxes. Since we have a progressive income tax system, and a system that levies tax at the federal, state and local levels, a rich American in a high-tax state may effectively pay 50 percent or more of his income in tax, while a poor American may effectively pay a rate ranging from a few percent down to well less than zero. (For instance, if you have a family on the dole, their income -- however meagre -- comes from the Government's largesse, and only a portion of that is recaptured via sales, excise and other taxes).
Speaking of disposable personal income, though, that brings up another question. If an American is getting a smaller share of the overall pie, but the size of the pie has increased to the point where he's still getting more pie than he did before, is he still getting screwed?
Now, I bring this up because America has gotten considerably richer than it was back in 1979. After all, think about 1979 for a moment. It was 1979. It sucked. In fact, July 12 of that year was the nadir of post-war American history, as I have conclusively proven here. Pleather. Gas lines. STAGFLATION! Carly Simon. I mean, my parents had plastic furniture in our living room. It was a bad year.
In July of 1979, the disposable personal income of the American people was roughly $1.8 trillion. That works out to roughly $8,000 for each of America's 225 million residents at the time. At the end of 2006, the disposable personal income of the American people was roughly $9.9 trillion. That works out to about $33,000 for each of America's 300 million residents at the time. Now, when you crunch those numbers through the GDP deflator, you find that a dollar back then is worth about 42 cents today. Still, the end result is that real per-capita disposable personal income has risen from $19,000 back in the day to $33,000 today. Thus, America is 73 percent richer than it was back when people wore wide ties.
That's just on a dollar-per-dollar basis too. After all, think of how life has improved since 1979 -- another thing income graphs don't tell you. In 1979, nobody had a personal computer, nobody had e-mail, nobody knew anything about the Internet, nobody could buy a decent car for love or money and nobody -- and I mean nobody -- could find a decent interior decorator. Instead you had shag carpets and plastic furniture and disco music and the death of equities and STAGFLATION! Oh, and Carly Simon. Who you listened to on something called a "record" -- or perhaps something called an "eight-track." And don't get me started about the regulated airlines or the 55 mph speed limit, 'cause we'll be here all night.
So now that we've established that Americans are collectively enjoying not just a bigger pie, but a much tastier pie at that, can we say people are getting hosed? For instance, the lowest quintile saw a roughly 30 pc drop in their share of the pie between 1979 and today. But they're still enjoying 21 pc more pie than they were before -- and much tastier pie. The middle class are enjoying 38 pc more pie. The upper-middle class perhaps have 50 pc more pie. One would generally think they are accordingly better off, because it's really good pie: kind of like the pie you get at a really good diner, compared to the three-day-old industrially-made pie you would get back in 1979.
True, the idea of seeing the rich guy get 280 pc more pie might stick in folks' craw a bit. But since people still have the individual opportunity to find ways to get more pie, with time they may soon reap the rewards of their labor with a giant slice of the stuff. After all, this is America.
WE DID IT! WE DID IT! MICHIGAN BEAT FLORIDA! MICHIGAN BEAT FLORIDA! HOLY TOLEDO!
What a game! What a way to start 2008! Holy Mary Mother of God, the Wolverines did it! The defense played great and the offense played great and Arrington and Manningham were on fire and even the coaching was good! Where the hell has this team been all these months? Sure, things weren't perfect -- we did have four turnovers -- but you couldn't have asked for more from this team. Wow! Let us revel in Michigan's 41-35 victory over evil Florida! Ha ha!
Were this any other team -- even USC -- I would celebrate this victory graciously. But it's Florida. Florida, whose undisciplined squad decided they would insult Michigan's honor before and during the game. Florida, whose evil coach Urban Meyer bizarrely claimed at halftime the officiating had hurt his team. Florida, a team whose stupid crowd antics are almost as annoying as Florida State's war chant/tomahawk chop. So chomp chomp, you bastards, because Michigan just whooped yo' ass! I hope you go 3-9 next year and lose to Vanderbilt! Better yet, I hope you lose your 2008 opener against Hawaii! Ha! HA! HAHAHAHAHA!
I do like Percy Harvin, though. Man, can he run. Oh, and not all Florida fans are scoundrels. For instance, I feel this man's pain, because as a Michigan fan, I've been there.
Anyway, THAT was a satisfying end to Michigan's college football season -- the first really satisfying end to a college football season we've had in a long time. I can only hope it kicks off some positive momentum for the 2008 season under Coach Rodriguez and Michigan gloriously marches into bowl season. Finally, my reaction to this wonderful victory can be summed up in one word.
HAIL to the Victors!
I KNOW WHAT I'm about to say may seem a bit curmudgeonly, but does anyone else find the Rose Bowl parade spectacularly boring television? I mean, it's a parade. You have floats and marching bands and balloons and a beauty queen here and there and people lined along the streets. That's all well and good, but the broadcast is ... two hours long. It would be one thing if it was a movie, but it's a parade. Thus, it's about as interesting as "Festival of Patriotic Songs" or some other television show from the old Eastern Bloc.
Now they're showing the float for the 2008 Olympics in Beijing. Say, I knew this broadcast reminded me of something:
READERS MAY WONDER – as I first did – just what exactly I said to justify someone calling me a “serious misogynist.” Last time I checked, I hadn’t called for the repeal of the Nineteenth Amendment, hadn’t called for ending the WIC Nutrition Program, and hadn’t called for women to be restricted in terms of their employment. So as you can imagine, I was a bit confused at why I was suddenly being derided as someone who hates women.
However, I soon discovered the reason. Apparently, my July 31 post in defense of “ladies night” promotions was so shocking and beyond the pale that it puts me in the same league as men who beat their wives, who want women’s jobs restricted to teaching and nursing, and who consider the idea of women voting anathema. At least that’s the conclusion one blogger drew upon reading my defense of the institution, viz:
One writer – who is a serious misogynist in “gentleman’s” clothing – says that men are not men if they can’t saddle up to a bar ready to pay. He goes on to say any man who presses such charges should lose their “status” as a man, and should no longer have the privilege of sleeping with any women. Wow. One can’t be a man if they feel that one way to stop perpetuating sexism is through the abolishment of such women-luring tactics?
What would be interesting, perhaps, is to do undercover work on what the bar considers a man to be – does it matter if they are straight or gay? What do these bars consider a lady? Are they only those who will catch the male gaze, maybe donning a skirt and cleavage-revealing top? Are they only feminine females? Are they heterosexual females? What happens if a masculine-identified lesbian woman walks up to the bar…does she get treated the same?
Just for the record, I would like to say how much I enjoy being in arguments that I really can’t win. You see, if I defend myself too fiercely, I’ll be condemned as a misogynist because my response would be seen as an overly harsh attack. Yet if I’m overly polite in my response – following the old dites vous quand vous parlez une dame principle – I’ll be condemned for supposedly not taking the argument seriously enough and thus belittling my opponent. But as I do consider my position right and just – and I am somewhat annoyed at being unfairly maligned as a misogynist – I have no choice but to respond.
First things first: I really don’t understand how I became the bad guy here.
I mean, my God. The guy who filed the lawsuit in New York, and thus sparked this whole debate, clearly has issues with women -- and Issues with a capital I. That’s made perfectly clear in my opponent’s post, in which she notes his anti-female ranting. But somehow I end up being the “serious misoygnist.” How’d that happen? Is it because I’m wearing a necktie in all the pictures on my blog’s front page, and thus representative of the male privilege-supporting Establishment?
Anyway, I daresay this argument reminds me of Kissinger’s old dictum that in academia, the infighting is so fierce because the stakes are so small. We are, after all, discussing “ladies night” promotions. We are not talking about the matters of equal pay for equal work, career advancement or leave policies – things some might consider marginally more important in terms of the battle against sexism in American life. We’re talking about whether men should complain about women getting into bars for a slightly cheaper price when the practice is clearly to the benefit of men. The answer is clearly No – as I explained here.
Now, our complaintant says I argue “men are not men if they can’t saddle up to a bar ready to pay.” Let’s be clear in that this not a question of can’t, but rather a question of won’t. To me, not offering to buy a girl a drink is gauche and unclassy. It is one thing if the recipient of the man’s largesse decides to pay for her own drink, but another entirely if the man does not first make the offer. As counterintuitive as it might seem, though, sexism doesn’t enter into this situation. To suggest that it does is confusing the real issue – which is the standards and behavior expected of men in this day and age.
Indeed, to paint the issue as solely a matter of sexism obfuscates a fundamental truth behind the matter: that men and women are different. Men are not simply women with different plumbing and vice versa. Arguing otherwise ignores the clear reality that men and women approach many things differently in life, ranging from conflict resolution to how much time should be spent getting ready to go out. That’s how things are. Now, those differences shouldn’t be used to disqualify a man from being a nurse or a woman from being a fighter pilot; that, as one can see, is sexism at its very core. But those differences do mean there are some basic standards for men and women that go along with their draw from the gene pool.
As it happens, we men have our own set of standards for each other that we’ve developed over the years, and it is in those that my argument is founded. That’s what this is about when one gets down to brass tacks. It’s not about whether men and women are being treated differently; indeed, at the core of this, women don’t enter into the equation at all. It’s about the fact men really shouldn’t complain about penny-ante “injustices” where they suffer no harm, should be willing to at least pay lip service to the provider ethic – which is hugely important to any man, whether or not he’ll admit it – and should deal with their problems coolly and rationally. In this case, that involves going to another bar, not making a federal case out of the deal.
Thus, our writer errs when she accuses me of suggesting, in her words, that “one can’t be a man if they feel that one way to stop perpetuating sexism is through the abolishment of such women-luring tactics.” This isn’t about stopping the perpetuation of sexism; this is about soft and weak men with chips on their shoulders. It doesn't take a rocket scientist to figure out the men who oppose "ladies' nights" probably aren't all that keen on other practices that help women, such as initiatives to boost female participation in the sciences.
As an aside, I don’t follow our writer’s complaint about “women-luring tactics.” Either the practice hurts men or it hurts women; it can’t be both when one has put forward a zero-sum argument.
As for the second half of our writer’s critique, I have not heard of any complaints where homosexuals are treated differently than their straight counterparts during these promotions, so that’s kind of a red herring. I would also suggest that any establishment that did so would find itself in a world of pain rather quickly, considering our society’s public intolerance for intolerance when it comes to those types of things.
One final point before I close. It seems to me that women who are frustrated with the supposed unfairness of “ladies night” promotions can help rectify the situation on the ground when they’re out partying. All they have to do is buy a man a drink, which should repair the supposed economic injury the man sustained while paying the higher cover charge. Then, if he offers to buy the next round, you’ll have at least one indication he might be a keeper.
FOR THE RECORD, I LOVE TECHNORATI. It allows me to find out blog posts that reference The Rant, which is very handy considering I might well overlook people responding to my posts, or holding my work up as examples of things wrong with our culture, polity, etc.
Anyway, thanks to Technorati, I noticed that a post I wrote a while back has been held up as prima facie evidence that Americans boorishly and arrogantly claim we are the greatest nation in the world.
I would be more sympathetic to this argument had the writer not used my "In 'N' Out Burger Served Up a 100-Decker Cheeseburger" post as his prima facie evidence. I mean, come on: how could anyone not be proud of America in such a situation, where our grand system of free enterprise allows people to get a 100x100 from In 'N' Out? Besides, this post was notably free of the petty regionalism to which I'm admittedly prone, and was composed with nothing but love and admiration for the nation I call home.
Anyway, our writer, Mr Michael J Gonda, argues as follows:
Of all the pressing matters in front of the people, the starkest is the fact that many Americans do not really understand or know what the meaning of freedom really actually is.
This can be attributed to a number of factors, including our lack of knowledge about our own history, our mental amnesia in connection with any world events preceding 9/11/2001, and our stubborn (arrogant) claim that we are the greatest nation in the world - not arrogant, just the greatest - and think the rest of the world should follow and be replicas of our government and system.
Well, since I've been called out as indicative of this problem -- rather insulting, n'est ce pas? -- I'm going to defend my stance accordingly. For America is the greatest nation in the world: not because of our military might or our geopolitical power, but because we value freedom. This freedom is necessarily entrenched in private property rights, the rule of law, our capitalist system and our openness towards allowing people to create wealth and find personal fulfillment. That doesn't mean the rest of the world should replicate our Government and system -- but it does mean we do a lot of things right. Other nations here on God's green earth could improve the lives of their citizens if they embraced the freedoms which we in America enjoy.
And I'm not going to apologize for making an entirely positive case on behalf of the United States -- especially when so many people from abroad would give their right arms to move here, and when people in the most wretched corners of the earth look to us for help and inspiration. I'm not suggesting there isn't room for us to improve -- that would be a bit much -- but sometimes it seems those who run down the United States are like parents who criticize their kid for getting a 95 on a test instead of 100. Let's keep things in perspective here, shall we?
WOO HOO! 2008 IS HERE!
For the record, The Rant had 149,354 unique visitors, 267,519 total visitors and 563,880 page views in 2007. That's an average of 409 unique visitors, 733 total visitors and 1545 page views per day. If you ask me, that's not too bad for a blog that doesn't advertise, goes on hiatus frequently with short notice and no good reason, and focuses on matters that don't generally involve politics or celebrities.
That said, though, I am proud knowing that my readers are a select group of highly intelligent and influential people, and grateful that my readers think I'm worth reading. I know this because about five pc of my visitors spend at least 30 minutes reading The Rant, and 72 pc visit via direct address or bookmarks. It is very gratifying to have all of you visit and read my work, and I hope you'll continue reading in 2008.