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Emma -:- An Immigration Experiment -:- Sun, Mar 20, 2005 at 10:42:46 (EST)

Emma -:- What? They Never Heard of WorldCom? -:- Sun, Mar 20, 2005 at 10:38:19 (EST)

Terri -:- Why the Dollar Will Not Collapse -:- Sun, Mar 20, 2005 at 09:43:28 (EST)

johnny5 -:- Solow says tech comprises most growth -:- Sun, Mar 20, 2005 at 08:45:03 (EST)

johnny5 -:- marketocracy -:- Sun, Mar 20, 2005 at 07:24:14 (EST)

Terri -:- Comparison -:- Sun, Mar 20, 2005 at 07:02:49 (EST)
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Terri -:- Where is Value? -:- Sun, Mar 20, 2005 at 07:16:02 (EST)
__ Terri -:- Jeremy Siegel -:- Sun, Mar 20, 2005 at 07:23:15 (EST)

johnny5 -:- Market fragility - dolllar strength? -:- Sun, Mar 20, 2005 at 06:47:47 (EST)

johnny5 -:- This was predicted at realty times -:- Sun, Mar 20, 2005 at 06:36:39 (EST)

Terri -:- The Dollar Will Not Collapse -:- Sun, Mar 20, 2005 at 06:18:47 (EST)
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Terri -:- The Dollar Will Likely Lose Value -:- Sun, Mar 20, 2005 at 06:49:05 (EST)
__ johnny5 -:- Re: The Dollar Will Likely Lose Value -:- Sun, Mar 20, 2005 at 07:00:27 (EST)
_ johnny5 -:- Re: The Dollar Will Not Collapse -:- Sun, Mar 20, 2005 at 06:31:54 (EST)

johnny5 -:- Pete called a dollar death -:- Sun, Mar 20, 2005 at 06:10:19 (EST)

Terri -:- Bonds: Taxable or Tax Free -:- Sat, Mar 19, 2005 at 18:48:00 (EST)
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johnny5 -:- If the dollar dies? -:- Sun, Mar 20, 2005 at 05:31:19 (EST)

Terri -:- Projected Returns for Stocks and Bonds -:- Sat, Mar 19, 2005 at 17:00:59 (EST)
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Terri -:- National Index Returns -:- Sat, Mar 19, 2005 at 22:12:03 (EST)

Terri -:- Jeremy Siegel -:- Sat, Mar 19, 2005 at 15:12:06 (EST)
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Terri -:- Terrific Interview -:- Sat, Mar 19, 2005 at 21:11:10 (EST)

Emma -:- In Life on the Mekong -:- Sat, Mar 19, 2005 at 13:54:12 (EST)

Emma -:- Private Pension Accounts in Texas -:- Sat, Mar 19, 2005 at 11:43:54 (EST)
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Emma -:- A Poor Plan -:- Sat, Mar 19, 2005 at 11:55:40 (EST)
__ Emma -:- Why are Returns so Low -:- Sat, Mar 19, 2005 at 13:46:35 (EST)
___ David E.. -:- Re: Why are Returns so Low -:- Sun, Mar 20, 2005 at 01:14:18 (EST)
____ Terri -:- Re: Why are Returns so Low -:- Sun, Mar 20, 2005 at 06:05:56 (EST)
___ johnny5 -:- Re: Why are Returns so Low -:- Sat, Mar 19, 2005 at 14:14:58 (EST)

Emma -:- Broadband and Phone Lines -:- Sat, Mar 19, 2005 at 10:29:15 (EST)
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johnny5 -:- Re: Broadband and Phone Lines -:- Sat, Mar 19, 2005 at 14:21:41 (EST)

Emma -:- Oil Wealth in Indonesia -:- Sat, Mar 19, 2005 at 10:24:47 (EST)

Terri -:- Warren Buffett and Optimism -:- Sat, Mar 19, 2005 at 09:50:16 (EST)
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Terri -:- Reasonably Priced Assets -:- Sat, Mar 19, 2005 at 10:23:14 (EST)
__ Terri -:- Finding Assets -:- Sat, Mar 19, 2005 at 10:47:48 (EST)

Terri -:- Bond Fund Refuge -:- Sat, Mar 19, 2005 at 07:30:11 (EST)
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johnny5 -:- What is buffet buying? -:- Sat, Mar 19, 2005 at 08:31:46 (EST)

Terri -:- Value and Value -:- Sat, Mar 19, 2005 at 07:01:18 (EST)
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johnny5 -:- Buffet is not a market timer? -:- Sat, Mar 19, 2005 at 08:27:58 (EST)

johnny5 -:- Strategic Failure to Deliver -:- Sat, Mar 19, 2005 at 05:56:25 (EST)

johnny5 -:- Naked Shorts on Nasdaq - Golden Rule -:- Sat, Mar 19, 2005 at 05:25:07 (EST)

Terri -:- Vanguard Returns -:- Fri, Mar 18, 2005 at 21:27:37 (EST)
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Terri -:- Sector Indexes -:- Fri, Mar 18, 2005 at 21:28:31 (EST)
__ johnny5 -:- DFA beating Vanguard -:- Sat, Mar 19, 2005 at 01:15:59 (EST)

Terri -:- Understanding Price Earning Ratios -:- Fri, Mar 18, 2005 at 20:30:17 (EST)
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Pete Weis -:- Re: Understanding Price Earning Ratios -:- Sat, Mar 19, 2005 at 04:20:46 (EST)
__ Terri -:- Well Done -:- Sat, Mar 19, 2005 at 06:12:08 (EST)
__ johnny5 -:- French on Behavioral Finance -:- Sat, Mar 19, 2005 at 05:08:00 (EST)
___ Pete Weis -:- Give credit to Terri for.... -:- Sat, Mar 19, 2005 at 12:54:32 (EST)
____ johnny5 -:- Re: Give credit to Terri for.... -:- Sat, Mar 19, 2005 at 21:03:47 (EST)
____ Terri -:- Re: Give credit to Pete for.... -:- Sat, Mar 19, 2005 at 14:03:19 (EST)
_ johnny5 -:- Kindleberger says one word 'Mania' -:- Sat, Mar 19, 2005 at 01:02:03 (EST)
__ Jennifer -:- Hope All is Fine -:- Sat, Mar 19, 2005 at 09:19:27 (EST)
___ johnny5 -:- Re: Hope All is Fine -:- Sat, Mar 19, 2005 at 20:48:10 (EST)

Terri -:- Japan and Bubbles Bursting -:- Fri, Mar 18, 2005 at 18:33:37 (EST)
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Terri -:- Limiting a Negative Wealth Effect -:- Fri, Mar 18, 2005 at 21:54:57 (EST)

Terri -:- The Wealth Effect -:- Fri, Mar 18, 2005 at 18:21:05 (EST)

johnny5 -:- Deflation coming home -:- Fri, Mar 18, 2005 at 16:56:03 (EST)

Pete Weis -:- Market cap to GDP -:- Fri, Mar 18, 2005 at 15:08:52 (EST)
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Terri -:- Well Done -:- Fri, Mar 18, 2005 at 15:55:38 (EST)
_ johnny5 -:- Re: Market cap to GDP -:- Fri, Mar 18, 2005 at 15:50:11 (EST)

Pete Weis -:- Tipping points -:- Fri, Mar 18, 2005 at 14:56:33 (EST)
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Terri -:- Well, Possibly -:- Fri, Mar 18, 2005 at 19:54:43 (EST)

Emma -:- Canada and Oil and Boom Towns -:- Fri, Mar 18, 2005 at 14:22:22 (EST)

Emma -:- Brazil Plane Maker Getting Big Orders -:- Fri, Mar 18, 2005 at 14:20:46 (EST)

Emma -:- Retirement, the Federal Way -:- Fri, Mar 18, 2005 at 14:19:41 (EST)

Setanta -:- Caste the financial net -:- Fri, Mar 18, 2005 at 10:12:31 (EST)

johnny5 -:- 423 million digital dollars stolen -:- Fri, Mar 18, 2005 at 04:00:30 (EST)
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Jennifer -:- We are Secure If we Feel Secure -:- Fri, Mar 18, 2005 at 09:05:27 (EST)
__ johnny5 -:- Re: We are Secure If we Feel Secure -:- Fri, Mar 18, 2005 at 13:50:37 (EST)
___ Jennifer -:- Learning How to Read -:- Fri, Mar 18, 2005 at 14:18:27 (EST)
____ Jennifer -:- Re: Learning How to Read -:- Fri, Mar 18, 2005 at 15:28:21 (EST)

johnny5 -:- Using the machines to steal yer money -:- Fri, Mar 18, 2005 at 03:01:33 (EST)
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johnny5 -:- They are using your computes against you -:- Fri, Mar 18, 2005 at 03:53:19 (EST)

johnny5 -:- Real price of oil after military expense -:- Fri, Mar 18, 2005 at 02:39:15 (EST)

johnny5 -:- moneys gone, should have bought houses -:- Fri, Mar 18, 2005 at 02:28:49 (EST)

johnny5 -:- Hack your taxes and beat the gubbment -:- Fri, Mar 18, 2005 at 02:20:40 (EST)

Terri -:- Energy and Growth -:- Thurs, Mar 17, 2005 at 17:52:00 (EST)
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Pancho Villa -:- Re: Energy and Growth -:- Thurs, Mar 17, 2005 at 19:57:03 (EST)
__ Pete Weis -:- What is energy? -:- Fri, Mar 18, 2005 at 10:04:52 (EST)
___ Emma -:- Re: What is energy? -:- Fri, Mar 18, 2005 at 14:23:11 (EST)
__ Terri -:- Energy and Utility -:- Thurs, Mar 17, 2005 at 20:52:31 (EST)

Billy -:- How Bush Won U.S. Presidency -:- Thurs, Mar 17, 2005 at 16:01:41 (EST)
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johnny5 -:- Rome survived Nero no? -:- Fri, Mar 18, 2005 at 00:15:26 (EST)

Pancho Villa -:- It's y(our) money -:- Thurs, Mar 17, 2005 at 14:18:17 (EST)

Emma -:- Americans Save So Little -:- Thurs, Mar 17, 2005 at 11:24:35 (EST)

johnny5 -:- Solow and sustainable development -:- Thurs, Mar 17, 2005 at 10:05:45 (EST)
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Terri -:- Thank You -:- Thurs, Mar 17, 2005 at 11:08:33 (EST)
_ johnny5 -:- Loss of wealth of nations -:- Thurs, Mar 17, 2005 at 10:12:28 (EST)

johnny5 -:- Leverage in TSY 50:1 -:- Thurs, Mar 17, 2005 at 10:00:54 (EST)

johnny5 -:- inflation & social disparity our future -:- Thurs, Mar 17, 2005 at 09:38:58 (EST)

Terri -:- Looking Ahead -:- Thurs, Mar 17, 2005 at 07:26:11 (EST)
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johnny5 -:- Re: Looking Ahead -:- Thurs, Mar 17, 2005 at 09:13:06 (EST)

Setanta -:- From the mouth of the great man himself! -:- Thurs, Mar 17, 2005 at 07:19:39 (EST)
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Terri -:- Re: From the mouth of the great man himself! -:- Thurs, Mar 17, 2005 at 08:52:02 (EST)
__ johnny5 -:- Re: From the mouth of the great man himself! -:- Thurs, Mar 17, 2005 at 09:07:40 (EST)
___ Emma -:- Peace Always -:- Thurs, Mar 17, 2005 at 10:06:16 (EST)
____ Pancho Villa -:- Re: Peace Always -:- Thurs, Mar 17, 2005 at 11:54:06 (EST)

Setanta -:- Bluff your way in Irish! -:- Thurs, Mar 17, 2005 at 07:13:03 (EST)
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johnny5 -:- Too drunk to learn -:- Thurs, Mar 17, 2005 at 09:02:49 (EST)
_ Terri -:- Re: Bluff your way in Irish! -:- Thurs, Mar 17, 2005 at 07:18:04 (EST)
__ johnny5 -:- Non alcoholic beer for the good -:- Thurs, Mar 17, 2005 at 09:04:18 (EST)
__ Setanta -:- Re: Bluff your way in Irish! -:- Thurs, Mar 17, 2005 at 07:42:03 (EST)
___ Terri -:- Re: Bluff your way in Irish! -:- Thurs, Mar 17, 2005 at 08:51:05 (EST)

Terri -:- We Can be Optimistic -:- Thurs, Mar 17, 2005 at 06:27:30 (EST)

Terri -:- Selected Vanguard Returns -:- Thurs, Mar 17, 2005 at 06:12:38 (EST)

johnny5 -:- Happy st pats day everyone -:- Thurs, Mar 17, 2005 at 03:20:17 (EST)
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Setanta -:- Re: Happy st pats day everyone -:- Thurs, Mar 17, 2005 at 07:02:12 (EST)
__ Terri -:- Re: Happy st pats day everyone -:- Thurs, Mar 17, 2005 at 07:15:29 (EST)

johnny5 -:- Real Estate Blog Pete - 87.6% in 5 yrs -:- Thurs, Mar 17, 2005 at 02:39:37 (EST)

johnny5 -:- More on the KL hedge fund cowboys -:- Wed, Mar 16, 2005 at 22:50:45 (EST)

johnny5 -:- He is sorry your money got stolen -:- Wed, Mar 16, 2005 at 22:34:37 (EST)
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johnny5 -:- ID theft victims cry to congress -:- Wed, Mar 16, 2005 at 22:39:18 (EST)

Terri -:- Vanguard Indexes -:- Wed, Mar 16, 2005 at 21:42:20 (EST)
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Terri -:- Vanguard MSCI Indexes -:- Wed, Mar 16, 2005 at 21:48:12 (EST)
__ johnny5 -:- My trust is hard to earn -:- Wed, Mar 16, 2005 at 22:16:38 (EST)

Emma -:- China's Economic Numbers -:- Wed, Mar 16, 2005 at 21:35:11 (EST)

Ted -:- Video from Krugman/Tanner debate? -:- Wed, Mar 16, 2005 at 21:15:53 (EST)

Terri -:- Vanguard Indexes -:- Wed, Mar 16, 2005 at 15:34:01 (EST)
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johnny5 -:- Weighting of Insiders -:- Wed, Mar 16, 2005 at 21:34:02 (EST)
__ Jennifer -:- Perfect for Investors -:- Wed, Mar 16, 2005 at 21:59:49 (EST)
___ johnny5 -:- Re: Perfect for Investors -:- Wed, Mar 16, 2005 at 22:06:53 (EST)

Emma -:- Explosive Mix in Mexico's Politics -:- Wed, Mar 16, 2005 at 12:28:22 (EST)

Emma -:- Yuan and Dollar -:- Wed, Mar 16, 2005 at 11:01:30 (EST)
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Emma -:- Growth and Currency -:- Wed, Mar 16, 2005 at 11:13:39 (EST)

Pete Weis -:- OPEC changes its story -:- Wed, Mar 16, 2005 at 10:49:57 (EST)

Terri -:- Learn About Vanguard -:- Wed, Mar 16, 2005 at 10:31:54 (EST)

Emma -:- Berkshire Hathaway and Insurance -:- Wed, Mar 16, 2005 at 10:27:30 (EST)

Emma -:- China: Stability and Development -:- Wed, Mar 16, 2005 at 10:24:18 (EST)

Jennifer -:- A Contract -:- Wed, Mar 16, 2005 at 06:14:25 (EST)
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Jennifer -:- Contract -:- Wed, Mar 16, 2005 at 06:18:39 (EST)
__ Jennifer -:- Act at Once -:- Wed, Mar 16, 2005 at 07:21:50 (EST)
___ Jennifer -:- Signature Guarantee -:- Wed, Mar 16, 2005 at 08:26:10 (EST)
____ Pete Weis -:- Excellent advice.... -:- Wed, Mar 16, 2005 at 10:30:18 (EST)
_____ Ari -:- Re: Excellent advice.... -:- Wed, Mar 16, 2005 at 11:04:38 (EST)
______ johnny5 -:- Thanks everyone -:- Wed, Mar 16, 2005 at 11:27:55 (EST)
_______ Jennifer -:- Re: Thanks everyone -:- Wed, Mar 16, 2005 at 12:00:17 (EST)

johnny5 -:- Raymond James lying to my uncle -:- Wed, Mar 16, 2005 at 03:02:09 (EST)
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Pete Weis -:- Sad to say............. -:- Wed, Mar 16, 2005 at 10:25:44 (EST)

David E... -:- 3 Times I have seen the light -:- Wed, Mar 16, 2005 at 02:12:20 (EST)
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johnny5 -:- The trouble is Minnie - there aint no light -:- Wed, Mar 16, 2005 at 02:35:13 (EST)
__ johnny5 -:- When does bush stumble off the stage? -:- Wed, Mar 16, 2005 at 02:44:06 (EST)

johnny5 -:- Soviets spent themselves into oblivion -:- Tues, Mar 15, 2005 at 22:08:07 (EST)
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johnny5 -:- Re: Soviets spent themselves into oblivion -:- Tues, Mar 15, 2005 at 22:32:37 (EST)

Pancho Villa -:- ...all wrong...? -:- Tues, Mar 15, 2005 at 21:39:14 (EST)
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johnny5 -:- Re: ...all wrong...? -:- Tues, Mar 15, 2005 at 21:58:40 (EST)
__ Jennifer -:- Paul Krugman was Right -:- Wed, Mar 16, 2005 at 08:28:53 (EST)
___ Pete Weis -:- It's strange....... -:- Wed, Mar 16, 2005 at 10:46:55 (EST)
____ Terri -:- Re: It's strange....... -:- Wed, Mar 16, 2005 at 11:06:19 (EST)

johnny5 -:- China wants OIL, not dollars -:- Tues, Mar 15, 2005 at 21:09:40 (EST)

Pete Weis -:- Recession? -:- Tues, Mar 15, 2005 at 14:49:23 (EST)
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Terri -:- Re: Recession? -:- Tues, Mar 15, 2005 at 16:38:39 (EST)
__ Terri -:- Re: Recession? -:- Tues, Mar 15, 2005 at 20:17:04 (EST)
___ johnny5 -:- If the dollar falls -:- Tues, Mar 15, 2005 at 20:58:41 (EST)

Terri -:- Demand for Dollars -:- Tues, Mar 15, 2005 at 14:38:27 (EST)
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johnny5 -:- Re: Demand for Dollars -:- Tues, Mar 15, 2005 at 20:35:25 (EST)
_ Pete Weis -:- S&P a definite loss for most.... -:- Tues, Mar 15, 2005 at 15:03:30 (EST)
__ Pete Weis -:- The value of our assets... -:- Tues, Mar 15, 2005 at 15:07:15 (EST)
___ Terri -:- Re: The value of our assets... -:- Tues, Mar 15, 2005 at 16:46:05 (EST)

Terri -:- Investing in Europe -:- Tues, Mar 15, 2005 at 13:44:26 (EST)
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johnny5 -:- Re: Investing in Europe -:- Tues, Mar 15, 2005 at 20:23:35 (EST)

Terri -:- Investing in Developed Countries -:- Tues, Mar 15, 2005 at 13:18:29 (EST)
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johnny5 -:- Re: Investing in Developed Countries -:- Tues, Mar 15, 2005 at 20:18:35 (EST)

Emma -:- Developing and Developed Nations -:- Tues, Mar 15, 2005 at 09:59:22 (EST)
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johnny5 -:- World Melting Pot -:- Tues, Mar 15, 2005 at 20:06:07 (EST)

Emma -:- Investing -:- Tues, Mar 15, 2005 at 08:14:19 (EST)
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johnny5 -:- Re: Investing -:- Tues, Mar 15, 2005 at 19:57:35 (EST)

Emma -:- Biological Resources -:- Tues, Mar 15, 2005 at 07:18:12 (EST)

johnny5 -:- Why invest in Europe? -:- Tues, Mar 15, 2005 at 06:30:16 (EST)
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johnny5 -:- Re: Why invest in Europe? -:- Tues, Mar 15, 2005 at 06:35:38 (EST)
__ RL -:- Re: Why invest in Europe? -:- Tues, Mar 15, 2005 at 08:50:27 (EST)
___ Institutional Investor -:- Re: Why invest in Europe? -:- Tues, Mar 15, 2005 at 10:40:21 (EST)
____ RL -:- Re: Why invest in Europe? -:- Thurs, Mar 17, 2005 at 03:48:13 (EST)
____ johnny5 -:- How much tech growth is left? -:- Tues, Mar 15, 2005 at 19:47:08 (EST)
_____ RL -:- Re: How much tech growth is left? -:- Thurs, Mar 17, 2005 at 04:05:43 (EST)
______ johnny5 -:- Re: How much tech growth is left? -:- Thurs, Mar 17, 2005 at 06:09:26 (EST)
_______ RL -:- Re: How much tech growth is left? -:- Thurs, Mar 17, 2005 at 07:16:18 (EST)
________ johnny5 -:- Re: How much tech growth is left? -:- Thurs, Mar 17, 2005 at 08:55:14 (EST)
_________ RL -:- Re: How much tech growth is left? -:- Fri, Mar 18, 2005 at 05:20:38 (EST)

Emma -:- Our Biological Resources -:- Tues, Mar 15, 2005 at 06:23:40 (EST)

Emma -:- Health Care as our Resource -:- Tues, Mar 15, 2005 at 06:15:33 (EST)

Emma -:- Health Care as a Precious Resource -:- Tues, Mar 15, 2005 at 06:05:25 (EST)

johnny5 -:- Data cowboy steal yer money - cspn3 10am -:- Mon, Mar 14, 2005 at 19:25:55 (EST)

johnny5 -:- The MATRIX has you Jennifer - GUILTY -:- Mon, Mar 14, 2005 at 18:51:45 (EST)
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Ari -:- Nonsense -:- Mon, Mar 14, 2005 at 19:39:49 (EST)
__ johnny5 -:- Blue pills for you! hehe -:- Mon, Mar 14, 2005 at 19:43:19 (EST)
___ johnny5 -:- Before you all go crazy again -:- Mon, Mar 14, 2005 at 19:59:30 (EST)
____ johnny5 -:- Some movies to watch -:- Mon, Mar 14, 2005 at 20:32:29 (EST)
____ Ari -:- Re: Before you all go crazy again -:- Mon, Mar 14, 2005 at 20:09:16 (EST)
_ johnny5 -:- Re: The MATRIX has you Jennifer - GUILTY -:- Mon, Mar 14, 2005 at 18:58:55 (EST)
__ johnny5 -:- Who will you call if you have no mouth -:- Mon, Mar 14, 2005 at 19:07:02 (EST)

Terri -:- Arguing Stocks and Bonds -:- Mon, Mar 14, 2005 at 18:26:11 (EST)
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johnny5 -:- No energy -:- Mon, Mar 14, 2005 at 18:46:12 (EST)
__ Terri -:- Bonds and Energy -:- Mon, Mar 14, 2005 at 18:55:09 (EST)
___ johnny5 -:- Energy Viper -:- Mon, Mar 14, 2005 at 19:13:14 (EST)

Emma -:- Imagine Life With no Butterflies -:- Mon, Mar 14, 2005 at 16:45:29 (EST)

Terri -:- Conservative Investing -:- Mon, Mar 14, 2005 at 12:05:55 (EST)
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johnny5 -:- Re: Conservative Investing -:- Mon, Mar 14, 2005 at 18:37:56 (EST)
__ Terri -:- Re: Conservative Investing -:- Mon, Mar 14, 2005 at 20:56:35 (EST)

Pete Weis -:- Bubbles - whose at fault? -:- Mon, Mar 14, 2005 at 10:14:11 (EST)

Terri -:- Bond and Stocks -:- Mon, Mar 14, 2005 at 08:34:02 (EST)

Terri -:- Building a Bond Portfolio -:- Mon, Mar 14, 2005 at 08:06:23 (EST)

Terri -:- Buying and Selling Bonds -:- Mon, Mar 14, 2005 at 06:25:54 (EST)
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johnny5 -:- Re: Buying and Selling Bonds -:- Mon, Mar 14, 2005 at 06:43:32 (EST)

Pete Weis -:- Corporate bonds risky? -:- Mon, Mar 14, 2005 at 00:28:55 (EST)
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johnny5 -:- Re: Corporate bonds risky? -:- Mon, Mar 14, 2005 at 00:42:43 (EST)
__ johnny5 -:- Re: Corporate bonds risky? -:- Mon, Mar 14, 2005 at 00:58:20 (EST)
___ Pete Weis -:- Excellent posts Johnny -:- Mon, Mar 14, 2005 at 09:28:47 (EST)
____ johnny5 -:- Re: Excellent posts Johnny -:- Mon, Mar 14, 2005 at 18:31:59 (EST)

Emma -:- Our Currency, Your Problem -:- Sun, Mar 13, 2005 at 19:05:59 (EST)

Emma -:- The Quality Health Care Cure? -:- Sun, Mar 13, 2005 at 18:57:36 (EST)
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johnny5 -:- Re: The Quality Health Care Cure? -:- Mon, Mar 14, 2005 at 00:31:21 (EST)

Fur -:- Weaken Dollar -:- Sun, Mar 13, 2005 at 14:17:33 (EST)
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johnny5 -:- Perhaps -:- Sun, Mar 13, 2005 at 16:07:37 (EST)
_ Fur -:- Re: Weaken Dollar -:- Sun, Mar 13, 2005 at 14:19:55 (EST)

Emma -:- Three Proofs that TSM is Efficient -:- Sun, Mar 13, 2005 at 10:27:59 (EST)
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johnny5 -:- Berkshire Hathaway -:- Sun, Mar 13, 2005 at 16:29:42 (EST)

Emma -:- The President's Stealthy Tax Increase -:- Sun, Mar 13, 2005 at 10:14:07 (EST)
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David E... -:- Why do the Republicans punish the rich? -:- Sun, Mar 13, 2005 at 14:01:23 (EST)
__ Paul G. Brown -:- Re: Why do the Republicans punish the rich? -:- Mon, Mar 14, 2005 at 02:45:50 (EST)
___ David E... -:- Re: Why do the Republicans punish the rich? -:- Mon, Mar 14, 2005 at 13:03:10 (EST)

Emma -:- China to Cut School Fees For Poorest -:- Sun, Mar 13, 2005 at 09:39:53 (EST)
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johnny5 -:- Tianemen redux -:- Sun, Mar 13, 2005 at 16:01:20 (EST)

Emma -:- 'Every Man a Speculator' -:- Sun, Mar 13, 2005 at 09:36:22 (EST)

Emma -:- Beyond Our Interests -:- Sun, Mar 13, 2005 at 06:54:39 (EST)
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Terri -:- Re: Beyond Our Interests -:- Sun, Mar 13, 2005 at 18:14:26 (EST)

Emma -:- Risk and Time -:- Sun, Mar 13, 2005 at 06:43:56 (EST)
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johnny5 -:- Short term puts and calls -:- Sun, Mar 13, 2005 at 23:29:54 (EST)

johnny5 -:- Running on Empty afterthoughts -:- Sat, Mar 12, 2005 at 22:52:22 (EST)
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johnny5 -:- Re: Running on Empty afterthoughts -:- Sat, Mar 12, 2005 at 22:58:28 (EST)

Terri -:- National Index Returns -:- Sat, Mar 12, 2005 at 17:46:40 (EST)
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johnny5 -:- Re: National Index Returns -:- Sat, Mar 12, 2005 at 18:03:47 (EST)
__ Terri -:- Allocation -:- Sat, Mar 12, 2005 at 18:36:24 (EST)
___ johnny5 -:- Sounds great -:- Sat, Mar 12, 2005 at 21:20:31 (EST)
____ Terri -:- Re: Sounds great -:- Sat, Mar 12, 2005 at 21:34:40 (EST)
_____ johnny5 -:- Re: Sounds great -:- Sat, Mar 12, 2005 at 23:03:45 (EST)
______ Jennifer -:- Re: Sounds great -:- Sun, Mar 13, 2005 at 08:45:34 (EST)
_______ Jennifer -:- Re: Sounds great -:- Sun, Mar 13, 2005 at 14:02:12 (EST)
________ johnny5 -:- Slashdot.org -:- Sun, Mar 13, 2005 at 15:43:27 (EST)
_________ David E.. -:- Fidelity Competence -:- Sun, Mar 13, 2005 at 18:52:32 (EST)
__________ johnny5 -:- Human Capital -:- Sun, Mar 13, 2005 at 23:45:09 (EST)
_________ Jennifer -:- There is no Worry -:- Sun, Mar 13, 2005 at 18:34:55 (EST)
__________ Jennifer -:- Re: There is no Worry -:- Sun, Mar 13, 2005 at 18:46:05 (EST)
___________ johnny5 -:- Re: There is no Worry -:- Mon, Mar 14, 2005 at 00:10:23 (EST)

Terri -:- Gauging the Economy by Interest Rates -:- Sat, Mar 12, 2005 at 17:41:22 (EST)

johnny5 -:- Running on Empty watch on web tonight -:- Sat, Mar 12, 2005 at 16:29:03 (EST)

Emma -:- Possessions and Status -:- Sat, Mar 12, 2005 at 14:12:51 (EST)
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Emma -:- Possessions and Status - 1 -:- Sat, Mar 12, 2005 at 14:13:14 (EST)
__ johnny5 -:- The solution of the past -:- Sat, Mar 12, 2005 at 15:56:27 (EST)

Emma -:- Monetary Policy -:- Sat, Mar 12, 2005 at 13:49:27 (EST)

Terri -:- BABY-SITTING THE ECONOMY -:- Sat, Mar 12, 2005 at 11:42:47 (EST)
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johnny5 -:- Who will watch warrens Baby? -:- Sat, Mar 12, 2005 at 15:24:20 (EST)

Emma -:- Africa's Garment Factories -:- Sat, Mar 12, 2005 at 09:53:54 (EST)
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Emma -:- Africa's Garment Factories - 1 -:- Sat, Mar 12, 2005 at 09:55:40 (EST)

Terri -:- Sector Stock Indexes -:- Sat, Mar 12, 2005 at 09:31:24 (EST)

Terri -:- Vanguard Returns -:- Sat, Mar 12, 2005 at 09:25:36 (EST)
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johnny5 -:- Re: Vanguard Returns -:- Sat, Mar 12, 2005 at 15:10:10 (EST)

Emma -:- Monetary Policy -:- Sat, Mar 12, 2005 at 08:29:14 (EST)
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Pete Weis -:- Re: Monetary Policy -:- Sat, Mar 12, 2005 at 11:23:08 (EST)

joseph hill -:- competition -:- Sat, Mar 12, 2005 at 08:22:55 (EST)

Emma -:- Ben Bernanke on the Trade Deficit -:- Sat, Mar 12, 2005 at 07:24:30 (EST)
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Pete Weis -:- Re: Ben Bernanke on the Trade Deficit -:- Sat, Mar 12, 2005 at 11:50:38 (EST)
__ johnny5 -:- Re: Ben Bernanke on the Trade Deficit -:- Sat, Mar 12, 2005 at 15:00:40 (EST)
___ Pete Weis -:- Re: Ben Bernanke on the Trade Deficit -:- Sat, Mar 12, 2005 at 23:55:13 (EST)

Terri -:- Household Debt -:- Fri, Mar 11, 2005 at 22:09:11 (EST)
_
johnny5 -:- Re: Household Debt -:- Sat, Mar 12, 2005 at 03:02:03 (EST)
__ Ari -:- Re: Household Debt -:- Sat, Mar 12, 2005 at 09:49:17 (EST)
___ johnny5 -:- Re: Household Debt -:- Sat, Mar 12, 2005 at 14:49:16 (EST)
____ Ari -:- Thanks -:- Sat, Mar 12, 2005 at 18:44:58 (EST)
_____ johnny5 -:- 16 tons and what do you get? -:- Sat, Mar 12, 2005 at 20:59:23 (EST)
______ johnny5 -:- Emma called it -:- Sat, Mar 12, 2005 at 21:09:05 (EST)

Terri -:- Stocks and Bonds -:- Fri, Mar 11, 2005 at 21:59:54 (EST)

Pancho Villa -:- Welcome to SANTA-CLAUS.com? -:- Fri, Mar 11, 2005 at 20:50:36 (EST)

johnny5 -:- But didn't XOM say this was a cycle? -:- Fri, Mar 11, 2005 at 18:16:04 (EST)

Howard -:- Meet the Press -:- Fri, Mar 11, 2005 at 15:17:06 (EST)
_
Paul G. Brown -:- Re: Meet the Press -:- Fri, Mar 11, 2005 at 17:22:08 (EST)
__ Howard -:- Re: Meet the Press -:- Fri, Mar 11, 2005 at 21:12:34 (EST)
___ Paul G. Brown -:- Re: Meet the Press -:- Sat, Mar 12, 2005 at 19:04:17 (EST)
____ Howard -:- Re: Meet the Press -:- Sat, Mar 12, 2005 at 21:06:03 (EST)
_____ Paul G. Brown -:- Re: Meet the Press -:- Sun, Mar 13, 2005 at 12:58:25 (EST)
______ Howard -:- Re: Meet the Press -:- Sun, Mar 13, 2005 at 20:30:14 (EST)

johnny5 -:- new s&p 500 -:- Fri, Mar 11, 2005 at 15:08:16 (EST)

johnny5 -:- Dollar exits? -:- Fri, Mar 11, 2005 at 14:59:05 (EST)

johnny5 -:- Americans funding hezbollah -:- Fri, Mar 11, 2005 at 13:13:25 (EST)

Bobby -:- Pathetic -:- Fri, Mar 11, 2005 at 11:53:40 (EST)
_
johnny5 -:- Adaptability indeed! -:- Fri, Mar 11, 2005 at 12:07:11 (EST)
__ johnny5 -:- Red Snakes eating Blue Newts -:- Fri, Mar 11, 2005 at 12:16:05 (EST)

Emma -:- How Long Can G.M. Tread Water? -:- Fri, Mar 11, 2005 at 11:21:04 (EST)
_
johnny5 -:- Re: How Long Can G.M. Tread Water? -:- Fri, Mar 11, 2005 at 11:55:21 (EST)

Emma -:- Five Years After the Bubble -:- Fri, Mar 11, 2005 at 11:18:31 (EST)
_
william bishop -:- Re: Five Years After the Bubble -:- Fri, Mar 11, 2005 at 12:47:13 (EST)
_ johnny5 -:- Kindleberger -:- Fri, Mar 11, 2005 at 11:44:46 (EST)

Emma -:- Teaching Samba to G.M. Brazil -:- Fri, Mar 11, 2005 at 11:17:09 (EST)

Setanta -:- Allez les verts!!!! -:- Fri, Mar 11, 2005 at 11:05:57 (EST)

Emma -:- The Flow of Credit: Ben Bernanke -:- Fri, Mar 11, 2005 at 06:18:10 (EST)
_
Emma -:- The Flow of Credit -:- Fri, Mar 11, 2005 at 06:25:40 (EST)
__ Pete Weis -:- Re: The Flow of Credit -:- Fri, Mar 11, 2005 at 10:23:33 (EST)
___ Emma -:- Understand and Argue -:- Fri, Mar 11, 2005 at 11:01:07 (EST)
____ Pete Weis -:- Absolutely -:- Fri, Mar 11, 2005 at 15:19:11 (EST)

Emma -:- Globalization: Alan Greenspan -:- Fri, Mar 11, 2005 at 06:03:31 (EST)
_
Emma -:- Footnotes to Speech -:- Fri, Mar 11, 2005 at 06:07:42 (EST)

johnny5 -:- Listen to Pete - he sees it coming. -:- Fri, Mar 11, 2005 at 05:48:57 (EST)

johnny5 -:- The limits of globalism -:- Thurs, Mar 10, 2005 at 23:43:12 (EST)
_
johnny5 -:- One armed economists - BWAHAH! -:- Fri, Mar 11, 2005 at 00:21:39 (EST)

Terri -:- Alan Greenspan -:- Thurs, Mar 10, 2005 at 20:38:48 (EST)
_
Terri -:- Adaptability -:- Thurs, Mar 10, 2005 at 20:56:47 (EST)
__ johnny5 -:- Rain on the parade? -:- Thurs, Mar 10, 2005 at 22:23:35 (EST)
___ johnny5 -:- Re: Rain on the parade? -:- Thurs, Mar 10, 2005 at 22:33:23 (EST)
____ johnny5 -:- You can't eat a house -:- Thurs, Mar 10, 2005 at 23:21:22 (EST)

Emma -:- Africa Makes Fine Films -:- Thurs, Mar 10, 2005 at 18:55:58 (EST)

Pancho Villa -:- The Bush administration goes soft (Huh?) -:- Thurs, Mar 10, 2005 at 18:30:32 (EST)
_
johnny5 -:- Servicing the military killed Rome -:- Thurs, Mar 10, 2005 at 22:11:35 (EST)

johnny5 -:- Political Shell Game -:- Thurs, Mar 10, 2005 at 18:10:51 (EST)

Pete Weis -:- Capsize point -:- Thurs, Mar 10, 2005 at 15:25:40 (EST)
_
johnny5 -:- Like Munger said -:- Thurs, Mar 10, 2005 at 17:31:26 (EST)
__ Pete Weis -:- Hey, I just like sailboats... -:- Thurs, Mar 10, 2005 at 19:13:00 (EST)
___ johnny5 -:- Sailing takes me away to where I want to be -:- Thurs, Mar 10, 2005 at 22:02:50 (EST)

johnny5 -:- Prepay penalty - was that in fine print -:- Thurs, Mar 10, 2005 at 12:50:41 (EST)
_
Setanta -:- Re: Prepay penalty - was that in fine print -:- Fri, Mar 11, 2005 at 04:30:57 (EST)
__ Jennifer -:- Re: Prepay penalty - was that in fine print -:- Fri, Mar 11, 2005 at 10:20:59 (EST)

johnny5 -:- America is number 1 er 2 um 3 no 4 uh 5? -:- Thurs, Mar 10, 2005 at 12:41:13 (EST)

Emma -:- Five Years After Nasdaq Hit Its Peak -:- Thurs, Mar 10, 2005 at 10:37:38 (EST)
_
johnny5 -:- Re: Five Years After Nasdaq Hit Its Peak -:- Thurs, Mar 10, 2005 at 12:27:13 (EST)

johnny5 -:- I did not have sex with that hedge fund -:- Thurs, Mar 10, 2005 at 10:36:20 (EST)
_
johnny5 -:- Re: I did not have sex with that hedge fund -:- Thurs, Mar 10, 2005 at 10:50:40 (EST)
__ Pancho Villa -:- Re: I did not have sex with that hedge fund -:- Thurs, Mar 10, 2005 at 11:00:18 (EST)

Emma -:- China Textiles Flood the U.S. -:- Thurs, Mar 10, 2005 at 10:31:47 (EST)

Pete Weis -:- 5 years later -:- Thurs, Mar 10, 2005 at 10:20:11 (EST)
_
Terri -:- Re: 5 years later -:- Thurs, Mar 10, 2005 at 19:10:09 (EST)
_ Emma -:- Re: 5 years later -:- Thurs, Mar 10, 2005 at 10:36:00 (EST)
__ Pete Weis -:- Re: 5 years later -:- Thurs, Mar 10, 2005 at 20:47:07 (EST)

Terri -:- What is a Hedge Fund? -:- Thurs, Mar 10, 2005 at 05:52:24 (EST)
_
Pancho Villa -:- Re: What is a Hedge Fund? -:- Thurs, Mar 10, 2005 at 11:12:21 (EST)
_ Pete Weis -:- Re: What is a Hedge Fund? -:- Thurs, Mar 10, 2005 at 09:51:11 (EST)
_ Setanta -:- Re: What is a Hedge Fund? -:- Thurs, Mar 10, 2005 at 07:42:23 (EST)
__ Terri -:- Ireland's Saving-Investment Plan -:- Thurs, Mar 10, 2005 at 08:37:58 (EST)
_ Terri -:- European Mutual Funds -:- Thurs, Mar 10, 2005 at 07:19:50 (EST)

johnny5 -:- NEW international vanguard vipers -:- Thurs, Mar 10, 2005 at 04:48:15 (EST)
_
Terri -:- Cost and Service -:- Thurs, Mar 10, 2005 at 05:39:10 (EST)
__ johnny5 -:- Service indeed! -:- Fri, Mar 11, 2005 at 00:41:44 (EST)
___ Terri -:- Simplicity -:- Fri, Mar 11, 2005 at 11:31:25 (EST)
____ Terri -:- Re: Simplicity -:- Fri, Mar 11, 2005 at 12:07:23 (EST)
___ Jennifer -:- Re: Service indeed! -:- Fri, Mar 11, 2005 at 10:18:29 (EST)
____ johnny5 -:- Re: Service indeed! -:- Fri, Mar 11, 2005 at 11:26:46 (EST)
____ Jennifer -:- Re: Service indeed! -:- Fri, Mar 11, 2005 at 10:22:52 (EST)

johnny5 -:- Politics killing America -:- Thurs, Mar 10, 2005 at 04:18:48 (EST)

Terri -:- Rising Long Term Interest Rates -:- Wed, Mar 09, 2005 at 21:51:22 (EST)
_
Pete Weis -:- Good point..... -:- Thurs, Mar 10, 2005 at 10:00:54 (EST)

Pete Weis -:- Going upside down -:- Wed, Mar 09, 2005 at 21:49:06 (EST)
_
Terri -:- Re: Going upside down -:- Wed, Mar 09, 2005 at 21:52:59 (EST)

Pancho Villa -:- Papa Roach's 'Unprepared world' -:- Wed, Mar 09, 2005 at 20:52:13 (EST)
_
Jennifer -:- Re: Papa Roach's 'Unprepared world' -:- Wed, Mar 09, 2005 at 21:09:37 (EST)
__ Pancho Villa -:- Re: Thank u -:- Wed, Mar 09, 2005 at 21:13:06 (EST)

Terri -:- Dreaming of Hedge Funds -:- Wed, Mar 09, 2005 at 20:02:33 (EST)
_
johnny5 -:- Why hedge funds underperform from a hedge manager -:- Thurs, Mar 10, 2005 at 04:12:07 (EST)

johnny5 -:- C-span3 tonight - the Rich cheat taxes -:- Wed, Mar 09, 2005 at 18:20:51 (EST)

johnny5 -:- A book for you Terri -:- Wed, Mar 09, 2005 at 17:36:54 (EST)
_
Terri -:- Charles Kindleberger -:- Wed, Mar 09, 2005 at 17:52:36 (EST)

Terri -:- Hedge Funds -:- Wed, Mar 09, 2005 at 17:20:15 (EST)
_
Terri -:- Hedge Fund Data Management -:- Wed, Mar 09, 2005 at 19:39:08 (EST)
_ johnny5 -:- Vanguard Europe on Bear markets -:- Wed, Mar 09, 2005 at 17:59:52 (EST)
__ Institutional Investor -:- Re: Vanguard Europe on Bear markets -:- Wed, Mar 09, 2005 at 21:59:40 (EST)
___ Setanta -:- Re: Vanguard Europe on Bear markets -:- Thurs, Mar 10, 2005 at 04:31:52 (EST)
____ Institutional Investor -:- Re: Vanguard Europe on Bear markets -:- Thurs, Mar 10, 2005 at 21:09:27 (EST)
___ johnny5 -:- Re: Vanguard Europe on Bear markets -:- Wed, Mar 09, 2005 at 22:59:27 (EST)
____ Institutional Investor -:- Re: Vanguard Europe on Bear markets -:- Thurs, Mar 10, 2005 at 21:06:54 (EST)
_____ johnny5 -:- Re: Vanguard Europe on Bear markets -:- Thurs, Mar 10, 2005 at 21:55:46 (EST)

Terri -:- Bear Funds -:- Wed, Mar 09, 2005 at 17:07:17 (EST)
_
David E.. -:- Bear Funds - my experience -:- Wed, Mar 09, 2005 at 18:52:06 (EST)
__ johnny5 -:- Buffet says put your money on afterburner flight -:- Wed, Mar 09, 2005 at 21:42:09 (EST)
_ johnny5 -:- Re: Bear Funds -:- Wed, Mar 09, 2005 at 17:48:10 (EST)

Pete Weis -:- XOM up - stocks & bonds down -:- Wed, Mar 09, 2005 at 15:08:18 (EST)
_
johnny5 -:- Re: XOM up - stocks & bonds down -:- Wed, Mar 09, 2005 at 16:09:18 (EST)

johnny5 -:- The case for hedge funds? -:- Wed, Mar 09, 2005 at 14:54:04 (EST)

johnny5 -:- Watching the nukular prez -:- Wed, Mar 09, 2005 at 14:43:01 (EST)
_
Setanta -:- Re: Watching the nukular prez -:- Thurs, Mar 10, 2005 at 04:16:42 (EST)
__ johnny5 -:- Re: Watching the nukular prez -:- Thurs, Mar 10, 2005 at 04:28:22 (EST)

Emma -:- Computing and Health Care Costs -:- Wed, Mar 09, 2005 at 12:22:58 (EST)
_
Emma -:- Health Industry Under Pressure to Computerize -:- Wed, Mar 09, 2005 at 12:26:34 (EST)
__ johnny5 -:- Re: Health Industry Under Pressure to Computerize -:- Wed, Mar 09, 2005 at 14:00:34 (EST)

Setanta -:- PK article on the anti-globalisation -:- Wed, Mar 09, 2005 at 12:08:54 (EST)
_
johnny5 -:- Re: PK article on the anti-globalisation -:- Wed, Mar 09, 2005 at 13:53:02 (EST)

Setanta -:- EU scores barmy own goal with Intel -:- Wed, Mar 09, 2005 at 11:27:23 (EST)
_
Emma -:- Intel in Japan -:- Wed, Mar 09, 2005 at 12:13:04 (EST)
__ johnny5 -:- Nuke em again! -:- Wed, Mar 09, 2005 at 13:34:50 (EST)

Emma -:- Transfer of Risk -:- Wed, Mar 09, 2005 at 11:06:39 (EST)
_
johnny5 -:- Re: Transfer of Risk -:- Wed, Mar 09, 2005 at 13:25:04 (EST)

Emma -:- Free Trade Proposal Splits Bolivian City -:- Wed, Mar 09, 2005 at 10:24:20 (EST)
_
johnny5 -:- Re: Free Trade Proposal Splits Bolivian City -:- Wed, Mar 09, 2005 at 13:21:50 (EST)

Pete Weis -:- Just another nail in...... -:- Wed, Mar 09, 2005 at 10:12:00 (EST)
_
Emma -:- Transfer of Risk -:- Wed, Mar 09, 2005 at 10:35:07 (EST)
__ Pete Weis -:- Good observation Emma -:- Wed, Mar 09, 2005 at 15:04:02 (EST)
__ johnny5 -:- Their is hope! -:- Wed, Mar 09, 2005 at 13:14:08 (EST)

Terri -:- Simplicity -:- Wed, Mar 09, 2005 at 07:26:03 (EST)
_
johnny5 -:- Mach 5 -:- Wed, Mar 09, 2005 at 13:02:26 (EST)

Terri -:- Liquidity -:- Wed, Mar 09, 2005 at 06:15:44 (EST)

johnny5 -:- Dollar 'miracles' -:- Wed, Mar 09, 2005 at 03:26:48 (EST)
_
j9 -:- Re: Dollar 'miracles' -:- Wed, Mar 09, 2005 at 08:10:55 (EST)
__ johnny5 -:- Re: Dollar 'miracles' -:- Wed, Mar 09, 2005 at 12:59:04 (EST)
___ jimsum -:- Re: Dollar 'miracles' -:- Wed, Mar 09, 2005 at 21:45:11 (EST)

johnny5 -:- Debt and investing -:- Wed, Mar 09, 2005 at 00:31:28 (EST)
_
Setanta -:- Re: Debt and investing -:- Wed, Mar 09, 2005 at 11:54:33 (EST)
__ johnny5 -:- Re: Debt and investing -:- Wed, Mar 09, 2005 at 12:49:32 (EST)
_ johnny5 -:- Federal Financing Bank? -:- Wed, Mar 09, 2005 at 04:15:29 (EST)
_ johnny5 -:- 100% returns -:- Wed, Mar 09, 2005 at 00:44:10 (EST)

johnny5 -:- Cheer Up Pete! -:- Tues, Mar 08, 2005 at 20:31:06 (EST)
_
Pete Weis -:- I'm cheered Johnny -:- Tues, Mar 08, 2005 at 21:02:32 (EST)
__ Emma -:- Re: I'm cheered Johnny -:- Tues, Mar 08, 2005 at 21:18:47 (EST)
___ Terri -:- Re: I'm cheered Johnny -:- Tues, Mar 08, 2005 at 21:49:44 (EST)
____ johnny5 -:- You guys the best! -:- Tues, Mar 08, 2005 at 23:31:43 (EST)

johnny5 -:- Come to fl, take a shower if you can? -:- Tues, Mar 08, 2005 at 20:18:10 (EST)

Emma -:- A Fighting Strategy for Veterans -:- Tues, Mar 08, 2005 at 19:28:59 (EST)
_
johnny5 -:- Poor veteran or poor welfare mom -:- Tues, Mar 08, 2005 at 20:09:09 (EST)
__ Emma -:- Re: Poor veteran or poor welfare mom -:- Tues, Mar 08, 2005 at 20:58:38 (EST)

Emma -:- A Just-Right Economy -:- Tues, Mar 08, 2005 at 10:00:05 (EST)
_
johnny5 -:- Computer hedonics counted 2 times? -:- Tues, Mar 08, 2005 at 19:48:39 (EST)

Jennifer -:- Annuities? -:- Tues, Mar 08, 2005 at 08:18:38 (EST)
_
johnny5 -:- Re: Annuities? -:- Tues, Mar 08, 2005 at 18:17:05 (EST)
_ Jennifer -:- Adding to: Annuities? -:- Tues, Mar 08, 2005 at 11:16:43 (EST)
_ Pete Weis -:- Re: Annuities? -:- Tues, Mar 08, 2005 at 10:56:00 (EST)
__ Jennifer -:- What do We Need? -:- Tues, Mar 08, 2005 at 11:23:07 (EST)
___ johnny5 -:- Re: What do We Need? -:- Tues, Mar 08, 2005 at 17:58:53 (EST)

johnny5 -:- Munger moans MPT, Diversifiication, Beta -:- Tues, Mar 08, 2005 at 02:38:14 (EST)
_
Terri -:- Excellent Post -:- Tues, Mar 08, 2005 at 16:16:02 (EST)
__ johnny5 -:- Re: Excellent Post -:- Tues, Mar 08, 2005 at 17:41:25 (EST)
_ Jennifer -:- Re: Munger moans MPT, Diversifiication, Beta -:- Tues, Mar 08, 2005 at 06:30:33 (EST)
__ johnny5 -:- Oh brother -:- Tues, Mar 08, 2005 at 10:40:22 (EST)
___ Jennifer -:- You are Right -:- Tues, Mar 08, 2005 at 11:27:03 (EST)
__ Jennifer -:- Re: Munger moans MPT, Diversifiication, Beta -:- Tues, Mar 08, 2005 at 08:31:45 (EST)
___ johnny5 -:- Re: Munger moans MPT, Diversifiication, Beta -:- Tues, Mar 08, 2005 at 10:49:24 (EST)
____ Jennifer -:- I Agree -:- Tues, Mar 08, 2005 at 11:30:54 (EST)
____ Pete Weis -:- Respect -:- Tues, Mar 08, 2005 at 11:29:35 (EST)
_____ johnny5 -:- Preface -:- Tues, Mar 08, 2005 at 17:49:53 (EST)
______ Terri -:- I Disagree -:- Tues, Mar 08, 2005 at 18:21:04 (EST)
_______ Jennifer -:- Re: I Disagree -:- Tues, Mar 08, 2005 at 18:36:43 (EST)
_____ Terri -:- Re: Respect -:- Tues, Mar 08, 2005 at 16:17:06 (EST)
__ Jennifer -:- Warren Buffett and Charles Munger -:- Tues, Mar 08, 2005 at 08:27:34 (EST)

Pete Weis -:- OF lazy Susan-deals & barter revenue -:- Mon, Mar 07, 2005 at 22:11:09 (EST)
_
johnny5 -:- Re: OF lazy Susan-deals & barter revenue -:- Mon, Mar 07, 2005 at 22:45:52 (EST)

johnny5 -:- Are bear funds wise Pete? -:- Mon, Mar 07, 2005 at 12:00:35 (EST)
_
Pete Weis -:- Re: Are bear funds wise Pete? -:- Mon, Mar 07, 2005 at 15:07:22 (EST)
__ johnny5 -:- The Great Inflation -:- Mon, Mar 07, 2005 at 17:38:56 (EST)
___ Pete Weis -:- Certain types of annuities.. -:- Mon, Mar 07, 2005 at 21:28:10 (EST)
____ johnny5 -:- Re: Certain types of annuities.. -:- Mon, Mar 07, 2005 at 22:28:47 (EST)
___ Jennifer -:- Be Conservative -:- Mon, Mar 07, 2005 at 21:21:15 (EST)

johnny5 -:- Canadian I-shares bad buy? -:- Mon, Mar 07, 2005 at 11:39:17 (EST)
_
jimsum -:- Re: Canadian I-shares bad buy? -:- Mon, Mar 07, 2005 at 23:43:50 (EST)

Emma -:- China's Economic Policy -:- Mon, Mar 07, 2005 at 11:08:32 (EST)

Emma -:- China Says It Won't Sell Dollars -:- Mon, Mar 07, 2005 at 10:34:59 (EST)

Emma -:- What Makes a Team a Success? -:- Mon, Mar 07, 2005 at 10:23:11 (EST)

Terri -:- Timing and Housing -:- Mon, Mar 07, 2005 at 07:26:11 (EST)
_
Pete Weis -:- Agree -:- Mon, Mar 07, 2005 at 09:55:28 (EST)
__ Emma -:- Mortgages in Europe -:- Mon, Mar 07, 2005 at 10:30:23 (EST)
___ Setanta -:- Re: Mortgages in Europe -:- Tues, Mar 08, 2005 at 12:31:45 (EST)
____ Terri -:- Adjustable or Fixed Rate Mortgages? -:- Tues, Mar 08, 2005 at 15:07:50 (EST)
_____ johnny5 -:- Re: Adjustable or Fixed Rate Mortgages? -:- Tues, Mar 08, 2005 at 17:36:55 (EST)

Terri -:- Minimal Market Timing -:- Mon, Mar 07, 2005 at 06:27:29 (EST)

Terri -:- Cautious Simple Investing -:- Mon, Mar 07, 2005 at 06:10:36 (EST)

johnny5 -:- Rust not Bust in Tampa, West Palm -:- Mon, Mar 07, 2005 at 05:47:33 (EST)

johnny5 -:- Don't Worry, Be Happy -:- Mon, Mar 07, 2005 at 04:20:46 (EST)
_
johnny5 -:- Like Terri's sunshine state - Negro Removal -:- Mon, Mar 07, 2005 at 04:26:40 (EST)

Terri -:- Listing iShares -:- Sun, Mar 06, 2005 at 19:29:18 (EST)
_
johnny5 -:- Re: Listing iShares -:- Sun, Mar 06, 2005 at 21:15:48 (EST)
__ DJ -:- Re: Listing iShares -:- Sun, Mar 06, 2005 at 22:53:07 (EST)
___ johnny5 -:- Transaction costs -:- Sun, Mar 06, 2005 at 23:46:48 (EST)
____ David E.. -:- Re: Transaction costs -:- Mon, Mar 07, 2005 at 21:45:27 (EST)

Terri -:- Warren Buffett on the Dollar -:- Sun, Mar 06, 2005 at 15:52:10 (EST)
_
johnny5 -:- Thomas Jefferson -:- Sun, Mar 06, 2005 at 18:31:50 (EST)
__ johnny5 -:- Re: Thomas Jefferson -:- Sun, Mar 06, 2005 at 19:00:58 (EST)

Terri -:- On Commodities -:- Sun, Mar 06, 2005 at 15:35:20 (EST)

johnny5 -:- Keep them laughing... -:- Sun, Mar 06, 2005 at 13:19:18 (EST)
_
johnny5 -:- Re: Keep them laughing... -:- Sun, Mar 06, 2005 at 13:57:26 (EST)

Emma -:- Who Wins in a New Social Security? -:- Sun, Mar 06, 2005 at 10:25:23 (EST)
_
johnny5 -:- Re: Who Wins in a New Social Security? -:- Sun, Mar 06, 2005 at 14:00:13 (EST)
__ jimsum -:- Re: Who Wins in a New Social Security? -:- Mon, Mar 07, 2005 at 19:00:49 (EST)
___ johnny5 -:- Re: Who Wins in a New Social Security? -:- Tues, Mar 08, 2005 at 02:30:46 (EST)

Emma -:- Companies Behaving Badly -:- Sun, Mar 06, 2005 at 10:17:29 (EST)
_
Emma -:- Note to Myself: 'Duh' -:- Sun, Mar 06, 2005 at 15:05:48 (EST)

Emma -:- Meeting Middle Class Needs -:- Sun, Mar 06, 2005 at 07:38:41 (EST)
_
Emma -:- Thank You -:- Sun, Mar 06, 2005 at 08:36:56 (EST)

Terri -:- Commodities: Speculation and Investment -:- Sun, Mar 06, 2005 at 07:19:37 (EST)
_
j9 -:- Re: Commodities: Speculation and Investment -:- Sun, Mar 06, 2005 at 07:51:12 (EST)

Terri -:- A Risky Risky Long Term Bond Market -:- Sun, Mar 06, 2005 at 07:00:27 (EST)
_
jimsum -:- Re: A Risky Risky Long Term Bond Market -:- Sun, Mar 06, 2005 at 22:51:05 (EST)
__ johnny5 -:- Re: A Risky Risky Long Term Bond Market -:- Sun, Mar 06, 2005 at 23:00:37 (EST)
___ jimsum -:- Re: A Risky Risky Long Term Bond Market -:- Mon, Mar 07, 2005 at 18:55:13 (EST)

Terri -:- A Complex Bond Market -:- Sun, Mar 06, 2005 at 06:50:10 (EST)

johnny5 -:- Krugman takes a dump on American Growth -:- Sat, Mar 05, 2005 at 23:15:00 (EST)
_
johnny5 -:- Re: Krugman takes a dump on American Growth -:- Sat, Mar 05, 2005 at 23:17:36 (EST)
__ David E... -:- Tone -:- Sun, Mar 06, 2005 at 11:37:50 (EST)
___ johnny5 -:- Where is my soap mouthwash? -:- Sun, Mar 06, 2005 at 13:14:36 (EST)
____ David E.. -:- Johnny5, Johnny5 -:- Sun, Mar 06, 2005 at 14:49:40 (EST)
_____ johnny5 -:- I-shares -:- Sun, Mar 06, 2005 at 18:55:19 (EST)
______ David E.. -:- Links -:- Sun, Mar 06, 2005 at 22:02:40 (EST)
_______ johnny5 -:- worldwide dividend etf's -:- Sun, Mar 06, 2005 at 22:45:58 (EST)
_____ Ari -:- Having Fun -:- Sun, Mar 06, 2005 at 15:12:18 (EST)

johnny5 -:- Problem with asset v. risk allocation -:- Sat, Mar 05, 2005 at 22:43:38 (EST)

Terri -:- Investing in Commodities -:- Sat, Mar 05, 2005 at 21:13:04 (EST)
_
j9 -:- Re: Investing in Commodities -:- Sat, Mar 05, 2005 at 22:40:42 (EST)
__ Terri -:- Re: Investing in Commodities -:- Sat, Mar 05, 2005 at 23:54:33 (EST)

Terri -:- National Index Returns -:- Sat, Mar 05, 2005 at 19:13:16 (EST)

johnny5 -:- futures less volatile than s&p index -:- Sat, Mar 05, 2005 at 14:12:27 (EST)
_
Terri -:- The Case for Commodities -:- Sat, Mar 05, 2005 at 15:33:05 (EST)
__ johnny5 -:- Re: The Case for Commodities -:- Sun, Mar 06, 2005 at 00:16:40 (EST)
___ Terri -:- Re: The Case for Commodities -:- Sun, Mar 06, 2005 at 10:54:40 (EST)

johnny5 -:- Decoy of the falling dollar -:- Sat, Mar 05, 2005 at 14:04:21 (EST)
_
johnny5 -:- More on bonds and inflation -:- Sat, Mar 05, 2005 at 21:53:34 (EST)

johnny5 -:- Phillipines gonna default -:- Sat, Mar 05, 2005 at 13:43:50 (EST)

Pancho Villa -:- Henri 'Papillon/Ponzi' Charriere... -:- Sat, Mar 05, 2005 at 12:59:58 (EST)
_
Jennifer -:- Central banks Face Dilemma -:- Sat, Mar 05, 2005 at 14:21:37 (EST)
__ johnny5 -:- Re: Central banks Face Dilemma -:- Sat, Mar 05, 2005 at 14:43:03 (EST)
___ Terri -:- Central banks and Private ownership -:- Sat, Mar 05, 2005 at 15:43:45 (EST)
____ johnny5 -:- Some consensus -:- Sat, Mar 05, 2005 at 17:23:19 (EST)
_____ Terri -:- Commodity Stocks or Commodities -:- Sat, Mar 05, 2005 at 18:22:53 (EST)

Terri -:- Hedge Funds -:- Sat, Mar 05, 2005 at 10:58:31 (EST)
_
Terri -:- European Investing -:- Sat, Mar 05, 2005 at 11:04:29 (EST)

Emma -:- Citgo and Houston and Venezuela -:- Sat, Mar 05, 2005 at 09:42:08 (EST)

Emma -:- Whose Patent Is It, Anyway? -:- Sat, Mar 05, 2005 at 09:40:05 (EST)

Terri -:- Investing and Quality Changes -:- Sat, Mar 05, 2005 at 07:34:28 (EST)
_
johnny5 -:- Brookings on Data Quality -:- Sat, Mar 05, 2005 at 14:24:17 (EST)
_ Terri -:- Adapting to Change -:- Sat, Mar 05, 2005 at 09:31:33 (EST)

Terri -:- Vanguard Fund Returns -:- Sat, Mar 05, 2005 at 07:12:17 (EST)
_
Terri -:- Sector Indexes -:- Sat, Mar 05, 2005 at 07:13:28 (EST)

Emma -:- Social Benefit Programs -:- Sat, Mar 05, 2005 at 07:06:38 (EST)

Terri -:- Stocks and Bonds -:- Sat, Mar 05, 2005 at 06:37:09 (EST)

Terri -:- Sunshine State -:- Fri, Mar 04, 2005 at 18:41:45 (EST)

Terri -:- Adjusting for Quality -:- Fri, Mar 04, 2005 at 15:06:15 (EST)
_
johnny5 -:- Re: Adjusting for Quality -:- Fri, Mar 04, 2005 at 21:26:29 (EST)

Terri -:- International Stock Indexes -:- Fri, Mar 04, 2005 at 15:03:38 (EST)

Terri -:- European Investing Puzzle -:- Fri, Mar 04, 2005 at 12:19:53 (EST)
_
Terri -:- Investing in Europe? -:- Fri, Mar 04, 2005 at 12:24:49 (EST)
__ johnny5 -:- Re: Investing in Europe? -:- Fri, Mar 04, 2005 at 14:32:17 (EST)
___ David E.. -:- Re: Investing in Europe? -:- Fri, Mar 04, 2005 at 22:30:15 (EST)
____ Terri -:- Investing in Asia? -:- Sat, Mar 05, 2005 at 10:46:55 (EST)

Emma -:- Trading for a Venture in China -:- Fri, Mar 04, 2005 at 10:58:21 (EST)

Emma -:- China Worries About Missing the Poor -:- Fri, Mar 04, 2005 at 10:55:21 (EST)

Pete Weis -:- When depreciation runs out -:- Fri, Mar 04, 2005 at 10:13:09 (EST)
_
Terri -:- What of International Real Estate? -:- Fri, Mar 04, 2005 at 10:52:47 (EST)

Terri -:- Hopeful Numbers -:- Fri, Mar 04, 2005 at 09:33:29 (EST)

johnny5 -:- Hedge Fund assets Frozen -:- Fri, Mar 04, 2005 at 09:08:57 (EST)

johnny5 -:- America by the numbers? why invest here? -:- Fri, Mar 04, 2005 at 07:47:49 (EST)

Terri -:- European and American Productivity Gains -:- Fri, Mar 04, 2005 at 07:26:51 (EST)
_
johnny5 -:- Good for europe - but not America -:- Fri, Mar 04, 2005 at 07:40:46 (EST)
__ Pancho Villa -:- Re: Good for europe - but not America -:- Fri, Mar 04, 2005 at 07:54:23 (EST)
___ johnny5 -:- Re: Good for europe - but not America -:- Fri, Mar 04, 2005 at 08:12:49 (EST)
____ Pancho Villa -:- Re: That's what IBM stands for... -:- Fri, Mar 04, 2005 at 08:37:56 (EST)
_____ Pancho Villa -:- I-B-M? -:- Fri, Mar 04, 2005 at 09:25:01 (EST)

Emma -:- Productivity Benefits -:- Fri, Mar 04, 2005 at 06:09:41 (EST)
_
Emma -:- Productivity Benefits - 1 -:- Fri, Mar 04, 2005 at 06:18:45 (EST)
__ Emma -:- Productivity Benefits - 2 -:- Fri, Mar 04, 2005 at 06:23:12 (EST)
___ johnny5 -:- Re: Productivity Benefits - 2 -:- Fri, Mar 04, 2005 at 08:39:09 (EST)

Emma -:- Measuring Productivity -:- Fri, Mar 04, 2005 at 05:34:27 (EST)

johnny5 -:- Johnny's Tour of Palm Beach County -:- Fri, Mar 04, 2005 at 00:45:55 (EST)
_
Pete Weis -:- Palm Beach has a special... -:- Fri, Mar 04, 2005 at 15:17:46 (EST)
__ Terri -:- Re: Palm Beach has a special... -:- Fri, Mar 04, 2005 at 18:35:34 (EST)
___ johnny5 -:- Lincoln Beach -:- Fri, Mar 04, 2005 at 19:50:53 (EST)

Terri -:- Productivity Growth -:- Thurs, Mar 03, 2005 at 19:54:55 (EST)
_
johnny5 -:- Hedonics Terri? -:- Fri, Mar 04, 2005 at 00:30:45 (EST)

Terri -:- Projected Bond Returns -:- Thurs, Mar 03, 2005 at 19:30:15 (EST)
_
Terri -:- Subdued Bond Returns -:- Thurs, Mar 03, 2005 at 20:29:13 (EST)

Pancho Villa -:- 1,3 > -:- Thurs, Mar 03, 2005 at 18:45:03 (EST)

Pancho Villa -:- Greenspan urges to 'save' the 'CA' -:- Thurs, Mar 03, 2005 at 18:28:15 (EST)
_
Pancho Villa -:- Re: Greenspan urges to 'save' the 'CA' -:- Thurs, Mar 03, 2005 at 18:29:56 (EST)

Pancho Villa -:- Greenspan urges to 'save' the 'CA' -:- Thurs, Mar 03, 2005 at 18:26:20 (EST)
_
Pete Weis -:- Re: Greenspan urges to 'save' the 'CA' -:- Thurs, Mar 03, 2005 at 21:51:05 (EST)
_ Pancho Villa -:- Re: Greenspan urges to ...(part II) -:- Thurs, Mar 03, 2005 at 18:34:47 (EST)

Pancho Villa alias Joey -:- Go, go Carly go! -:- Thurs, Mar 03, 2005 at 17:12:51 (EST)
_
johnny5 -:- Re: Go, go Carly go! -:- Thurs, Mar 03, 2005 at 17:35:37 (EST)
__ Pancho Villa -:- Re: Go, go Carly go! -:- Thurs, Mar 03, 2005 at 18:18:48 (EST)
___ Pete Weis -:- Wolfowitz -:- Thurs, Mar 03, 2005 at 21:40:16 (EST)

Emma -:- Mexican Oil Seeks Expansion -:- Thurs, Mar 03, 2005 at 10:11:04 (EST)

Emma -:- Drilling for Oil by the Yard -:- Thurs, Mar 03, 2005 at 10:09:55 (EST)
_
jimsum -:- in Springfield? -:- Thurs, Mar 03, 2005 at 21:41:45 (EST)
__ Emma -:- Re: in Springfield? -:- Thurs, Mar 03, 2005 at 22:09:25 (EST)

Emma -:- Disability Insurance -:- Thurs, Mar 03, 2005 at 10:07:53 (EST)
_
johnny5 -:- Re: Disability Insurance -:- Thurs, Mar 03, 2005 at 17:30:00 (EST)
__ johnny5 -:- Re: Disability Insurance -:- Thurs, Mar 03, 2005 at 23:42:54 (EST)
__ Emma -:- Medicaid? -:- Thurs, Mar 03, 2005 at 20:08:36 (EST)

Terri -:- Productivity Growth -:- Thurs, Mar 03, 2005 at 09:56:59 (EST)

Terri -:- Why Bonds Funds -:- Thurs, Mar 03, 2005 at 07:19:56 (EST)
_
Pete Weis -:- Does past performance... -:- Thurs, Mar 03, 2005 at 15:08:30 (EST)
__ johnny5 -:- why not bonds? -:- Thurs, Mar 03, 2005 at 17:19:29 (EST)

Jennifer -:- Housing Market Stability -:- Thurs, Mar 03, 2005 at 06:15:51 (EST)
_
Pete Weis -:- Housing turnover -:- Thurs, Mar 03, 2005 at 10:21:57 (EST)
__ Jennifer -:- Re: Housing turnover -:- Thurs, Mar 03, 2005 at 10:49:30 (EST)

Setanta -:- Sinn Fein economics for the provo riche -:- Thurs, Mar 03, 2005 at 05:48:34 (EST)
_
Jennifer -:- Re: Sinn Fein economics for the provo riche -:- Thurs, Mar 03, 2005 at 08:55:06 (EST)
__ Terri -:- Re: Sinn Fein economics for the provo riche -:- Thurs, Mar 03, 2005 at 09:42:07 (EST)

Terri -:- Vanguard Returns -:- Wed, Mar 02, 2005 at 19:20:09 (EST)
_
Terri -:- Sector Indexes -:- Wed, Mar 02, 2005 at 20:02:51 (EST)

Terri -:- Bond Fundss and Safety -:- Wed, Mar 02, 2005 at 19:10:48 (EST)
_
johnny5 -:- countrywide cd's beating bonds -:- Thurs, Mar 03, 2005 at 05:30:54 (EST)

johnny5 -:- From west palm beach -:- Wed, Mar 02, 2005 at 17:28:20 (EST)
_
johnny5 -:- Re: From west palm beach -:- Wed, Mar 02, 2005 at 17:34:59 (EST)
__ johnny5 -:- Re: From west palm beach -:- Wed, Mar 02, 2005 at 17:44:59 (EST)

johnny5 -:- More Wmd's? -:- Wed, Mar 02, 2005 at 12:41:54 (EST)

Emma -:- African Solutions to African Problems -:- Wed, Mar 02, 2005 at 12:01:53 (EST)

Emma -:- Where Has All the Prilosec Gone? -:- Wed, Mar 02, 2005 at 11:59:42 (EST)

Terri -:- Why We Must Save and Invest -:- Wed, Mar 02, 2005 at 11:08:03 (EST)
_
Terri -:- We Must Save and Invest -:- Wed, Mar 02, 2005 at 11:58:10 (EST)
__ johnny5 -:- Re: We Must Save and Invest -:- Wed, Mar 02, 2005 at 12:19:54 (EST)
___ johnny5 -:- Et Tu Warren? -:- Wed, Mar 02, 2005 at 12:33:18 (EST)

Pete Weis -:- Brother, do you have a dime? -:- Wed, Mar 02, 2005 at 10:19:54 (EST)
_
Emma -:- A Bad Bill Made Worse -:- Wed, Mar 02, 2005 at 10:42:36 (EST)

Terri -:- Saving and Investing -:- Wed, Mar 02, 2005 at 08:58:06 (EST)

Terri -:- U.S.: Housing -- Bubbly? -:- Tues, Mar 01, 2005 at 20:53:14 (EST)
_
Pete Weis -:- Re: U.S.: Housing -- Bubbly? -:- Tues, Mar 01, 2005 at 22:21:04 (EST)
__ johnny5 -:- What would scare Terri? -:- Wed, Mar 02, 2005 at 01:06:01 (EST)

Pancho Villa -:- Military or Story? -:- Tues, Mar 01, 2005 at 17:53:50 (EST)

Emma -:- Uruguay Veers Left, in a Latin Pattern -:- Tues, Mar 01, 2005 at 16:41:47 (EST)

Emma -:- China : Was the War Pointless? -:- Tues, Mar 01, 2005 at 15:52:28 (EST)

johnny5 -:- Private investors > -:- Tues, Mar 01, 2005 at 14:25:07 (EST)

Emma -:- Gold in the Boom in Home Prices -:- Tues, Mar 01, 2005 at 11:03:45 (EST)
_
johnny5 -:- Fat Fanny falls out of bed -:- Tues, Mar 01, 2005 at 11:13:44 (EST)

Emma -:- China's Oil Diplomacy in Latin America -:- Tues, Mar 01, 2005 at 10:45:26 (EST)

Emma -:- Mr. Gates Goes to Washington -:- Tues, Mar 01, 2005 at 10:38:53 (EST)

johnny5 -:- Ineffecient Market Hypothesis -:- Tues, Mar 01, 2005 at 03:05:12 (EST)
_
johnny5 -:- Saloman brothers bear quits! -:- Tues, Mar 01, 2005 at 03:07:47 (EST)

johnny5 -:- Exxon Changes thier Tune! -:- Tues, Mar 01, 2005 at 02:06:38 (EST)
_
johnny5 -:- International Diversification -:- Tues, Mar 01, 2005 at 10:27:36 (EST)

johnny5 -:- How many economic teams... -:- Mon, Feb 28, 2005 at 16:00:21 (EST)
_
johnny5 -:- Bush sub-cabinet vacancies? -:- Mon, Feb 28, 2005 at 16:03:14 (EST)
__ Pancho Villa -:- Re: Bush sub-cabinet vacancies? -:- Mon, Feb 28, 2005 at 18:28:28 (EST)
___ johnny5 -:- R. Glenn Hubbard -:- Mon, Feb 28, 2005 at 19:02:22 (EST)

Emma -:- Don't Blame Wal-Mart -:- Mon, Feb 28, 2005 at 15:52:54 (EST)
_
johnny5 -:- The man in the mirror -:- Mon, Feb 28, 2005 at 16:12:18 (EST)

johnny5 -:- Bye-Bye Housing Boom -:- Mon, Feb 28, 2005 at 15:41:15 (EST)

Emma -:- Political Driection in Brazil -:- Mon, Feb 28, 2005 at 12:47:22 (EST)

Pancho Villa -:- What would Blondie and Santana cut ? -:- Mon, Feb 28, 2005 at 09:56:09 (EST)
_
johnny5 -:- Hotel (debt) california -:- Mon, Feb 28, 2005 at 11:22:17 (EST)
__ Pete Weis -:- Excellent post -:- Mon, Feb 28, 2005 at 15:07:51 (EST)
___ johnny5 -:- Embrace the debt -:- Mon, Feb 28, 2005 at 16:18:02 (EST)
____ RL -:- slaves of debt? -:- Tues, Mar 01, 2005 at 03:52:50 (EST)
_____ johnny5 -:- Re: slaves of debt? -:- Tues, Mar 01, 2005 at 04:14:17 (EST)

Pete Weis -:- More dust -:- Mon, Feb 28, 2005 at 09:42:26 (EST)
_
johnny5 -:- A case for the secular bear -:- Mon, Feb 28, 2005 at 15:16:08 (EST)

johnny5 -:- Growth in Wal-mart - playing now on CNBC -:- Sun, Feb 27, 2005 at 19:50:42 (EST)
_
Pancho Villa -:- Re: Growth in Wal-mart - playing now on CNBC -:- Sun, Feb 27, 2005 at 20:39:30 (EST)
__ johnny5 -:- Re: Growth in Wal-mart - playing now on CNBC -:- Sun, Feb 27, 2005 at 23:38:57 (EST)
___ Mik -:- Re: Growth in Wal-mart - playing now on CNBC -:- Tues, Mar 01, 2005 at 16:42:00 (EST)
___ Pancho Villa -:- Re: 1.35bn - 0.45bn = ? -:- Mon, Feb 28, 2005 at 06:09:38 (EST)
____ johnny5 -:- Re: 1.35bn - 0.45bn = ? -:- Mon, Feb 28, 2005 at 11:35:33 (EST)

Emma -:- Thousands Died in Africa Yesterday -:- Sun, Feb 27, 2005 at 19:39:45 (EST)
_
Pancho Villa -:- Re: Thousands Died in Africa Yesterday -:- Sun, Feb 27, 2005 at 20:37:19 (EST)
__ johnny5 -:- Re: Thousands Died in Africa Yesterday -:- Sun, Feb 27, 2005 at 23:41:15 (EST)

Emma -:- Foreign Stocks and Portfolio Risk -:- Sun, Feb 27, 2005 at 19:18:42 (EST)

Emma -:- John Kenneth Galbraith -:- Sun, Feb 27, 2005 at 19:04:39 (EST)

Pancho Villa alias StùCazz -:- The 'Greenspan - Steve Miller Band: Abracadabra -:- Sun, Feb 27, 2005 at 18:50:16 (EST)
_
Pete Weis -:- Bernanke practices his Greenspeak -:- Sun, Feb 27, 2005 at 20:52:01 (EST)
_ johnny5 -:- Playing now on C-Span -:- Sun, Feb 27, 2005 at 19:06:51 (EST)
__ Pancho Villa -:- Re: Playing now on C-Span -:- Sun, Feb 27, 2005 at 19:22:38 (EST)
___ johnny5 -:- Re: Playing now on C-Span -:- Sun, Feb 27, 2005 at 19:24:48 (EST)

Emma -:- The Way We Eat: Tex Macs -:- Sun, Feb 27, 2005 at 18:21:20 (EST)

Pete Weis -:- Some Real Estate Thoughts -:- Sun, Feb 27, 2005 at 17:05:15 (EST)
_
johnny5 -:- Capital flows misprice assets -:- Sun, Feb 27, 2005 at 18:28:13 (EST)
__ Pete Weis -:- Re: Capital flows misprice assets -:- Sun, Feb 27, 2005 at 20:38:27 (EST)
_ Pete Weis -:- Some Real Estate Thoughts [cont.] -:- Sun, Feb 27, 2005 at 17:36:38 (EST)
_ Terri -:- Exceptional Real Estate Thoughts -:- Sun, Feb 27, 2005 at 17:32:09 (EST)

johnny5 -:- NPR with ben stein - REIT's are it! -:- Sun, Feb 27, 2005 at 16:41:38 (EST)

Bobby -:- Message Board Cleaning -:- Sun, Feb 27, 2005 at 16:39:49 (EST)


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Subject: An Immigration Experiment
From: Emma
To: All
Date Posted: Sun, Mar 20, 2005 at 10:42:46 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/20/opinion/20sun3.html An Immigration Experiment Worth Watching in Spain By DAVID C. UNGER Madrid — As so much of the Western world debates imposing tighter restrictions on immigration, it's a good time to take a look at Spain. The year-old Socialist government of José Luis Rodríguez Zapatero is moving in the opposite direction, toward a more enlightened system that aims to reduce the number of illegal foreigners by simplifying the path to legal recognition. It is too soon to know how well Spain's new approach will work or if it is even possible for one country in an increasingly borderless Europe to chart a distinctive course. But if Madrid's experiment is a success, it could become a model for other countries struggling to balance the need for additional labor with fears that terrorists could hide their tracks among large communities of foreign workers forced to live outside the legal system. The new Spanish policies largely reflect the thinking of Consuelo Rumi, the government's state secretary for immigration. As a symbol of the new approach, Ms. Rumi's offices have been moved out of the Interior Ministry, whose main business is policing, and are now housed in the Ministry of Labor and Social Affairs. Enforcement is still a priority: electronic barriers are being built along Spanish coastlines and new bilateral agreements have been reached so that foreigners who do not qualify for legal residence are swiftly returned to their home countries. What is different is that the large and rapidly expanding flow of foreigners into Spain is now frankly recognized as an economic phenomenon which can and should be coordinated with the labor needs of Spanish employers. Although Spain's overall unemployment rate hovers above 10 percent, the economy is desperately short of people willing to do some of the manual jobs Spaniards shun, for example in construction and agriculture. There are plenty of willing workers available to fill these jobs from North and Central Africa, Eastern Europe and Latin America. Its open borders with France and Portugal and the proximity of impoverished nations in North Africa - Morocco is only nine miles away at the closest point - make Spain an attractive destination for foreign workers, legal and illegal. Of the estimated 2.7 million foreigners now in Spain, 1 million are believed to be there illegally, more than three times as many as in 2001. That increase testifies to the failure of the previous government's policies, which were characterized by an overreliance on police sweeps and deportations. The more sophisticated approach now being tested rests on the sound premise that by regulating and smoothing the process of legal labor migration, illegal migration can be more effectively monitored and controlled. As a first step toward drawing foreigners out of the underground economy, the government is currently offering legal residency papers to people with no criminal record and a six-month labor contract in hand from an employer. After this amnesty expires in May, workers who fail to qualify will be deported, while those who employ them will face fines of more than $80,000 per illegal employee. Bringing eligible foreign workers into legal daylight makes it easier for the authorities to keep track of their employment status and their whereabouts. Making sure they are paid on the books and with appropriate social insurance contributions deducted should make their presence more acceptable to Spanish public opinion. Spain, like the United States and most Western countries, recognizes that people facing ethnic or political persecution in their home countries have a right to apply for refugee status. More unusually for Europe, Madrid is also opening a small door toward the kind of skills-based immigration offered by countries like Canada. Under an experimental system, highly qualified immigrants without labor contracts will be permitted to live legally in Spain for a limited period while they seek work. And recognizing that the trade, foreign and development policies of wealthier countries sometimes inadvertently contribute to the tide of desperate economic migrants by destroying third world agriculture and jobs, Ms. Rumi meets regularly with Spanish officials working in other ministries to try to achieve better policy coordination. In immigration, as in other areas of government, grand strategies often have unintended and unwanted consequences. But if the new Spanish policies do manage to achieve their ambitious aims, they could help set a positive precedent on a continent that has always been uneasy about welcoming foreigners and where xenophobic populism is a mounting political danger.

Subject: What? They Never Heard of WorldCom?
From: Emma
To: All
Date Posted: Sun, Mar 20, 2005 at 10:38:19 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/20/business/yourmoney/20gret.html What? They Never Heard of WorldCom? WHAT a week. Bernard J. Ebbers, founder of WorldCom, got to add felon to his already colorful curriculum vitae. Maurice R. Greenberg, dictator in chief at American International Group, the global insurance giant, was toppled after almost 40 years at his post. The Federal Reserve told Citigroup it could not make any major acquisitions until it cleaned up its compliance act. And General Motors laid a big, scary earnings egg. Isn't it nice to know these incidents are anomalies and that most American companies are chugging along, reporting good solid earnings? Sure would be. But contrary to popular belief, the quality of corporate earnings is on the slide again and, as a result, Richard Bernstein, chief United States strategist at Merrill Lynch, is advising investors to tread carefully. 'There is an impression that the quality of earnings has improved dramatically,' he said. 'That is true relative to the worst levels of post-bubble reporting, but relative to history, the absolute quality of earnings is quite poor.' And getting poorer. Mr. Bernstein reaches this depressing conclusion by analyzing the difference between the earnings that Standard & Poor's 500 companies have reported under generally accepted accounting principles and operating earnings, the figures companies typically trumpet because they do not include write-offs and other unusual items. The difference between the two figures, Mr. Bernstein says, is the G.A.A.P. gap. And it is widening. In the most recent period - the fourth quarter of 2004 - the gap was 13.7 percent. In other words, operating earnings were on average 13.7 percent higher than reported earnings. While that figure is well down from the 40 percent gap reached in 2002, it is much higher than the long-term, pre-bubble average of 6.7 percent. The result: while stock valuations may not be so high as they were before the bubble burst, the quality of earnings appears to be worse. Of course, none of this might matter if investors bought stocks based on G.A.A.P. earnings. But too many buy shares based on what companies report in their press releases and on their quarterly conference calls, which are often heavily skewed to earnings before the bad stuff. 'The fact is, stocks trade on press releases, on what the headline number is,' Mr. Bernstein said. 'And on the conference calls, companies talk about whatever numbers they want to talk about. Investors should still be very skeptical of the quality of earnings.' Mr. Bernstein said that he thought the recent downturn in earnings quality began, not surprisingly, a couple of quarters ago, when the profit surge started to subside. 'If times are good, companies are not under pressure to keep their growth profile up,' he said. 'In tough times, when you get a cyclical company that has been coined by the Street as a growth company, it feels pressure to keep up that profile.' That's when the earnings games usually begin. By focusing on operating earnings, rather than on more stringent reported figures, companies try to steer investors away from mistakes such as asset write-downs or restructuring charges. But these factors reflect bad choices by managers - such as overpriced acquisitions - and should definitely not be excluded from investors' analyses. 'The difference between operating and reported earnings is an indication of how well executives are managing the balance sheet of their company,' Mr. Bernstein said. This is often lost on investors who pay little heed to the balance sheet. The five companies with the widest gap between reported earnings and operating income currently, according to the Merrill Lynch analysis, are: Eastman Kodak; Georgia Pacific, a paper products company; Rowan Companies, an oil drilling concern; Ford Motor; and Clorox. Mr. Bernstein said the vast majority of companies with the biggest gaps between reported earnings and operating income are of lesser-quality, those whose common stocks are ranked B or below by S.& P.; among the five with the widest gap, all are rated B or below except Clorox, which is rated A. So investors can often limit their exposure to earnings shenanigans by sticking with high-quality issues. But such a strategy won't offer full protection. As Mr. Bernstein noted, 22 percent of the companies with the largest gaps between reported and operating earnings were rated B or better by S.& P. Mr. Bernstein said he thought the earnings games would be curtailed sharply if the Securities and Exchange Commission required that all company communications with investors reflected figures computed in accordance with generally accepted accounting principles. Then there would be no confusion among investors about what a particular company really earned in a quarter. 'The reason you have G.A.A.P. is so investors have consistent clear information,' Mr. Bernstein said. 'The U.S. has always prided itself on having the most transparent financial markets. 'But over the past 5 to 10 years, the U.S. market has become more opaque, and foreign markets have become more transparent. That has huge implications for the economy as a whole and for the cost of capital.'

Subject: Why the Dollar Will Not Collapse
From: Terri
To: All
Date Posted: Sun, Mar 20, 2005 at 09:43:28 (EST)
Email Address: Not Provided

Message:
The dollar can not collapse because American assets are vastly valuable. Should American asset prices decline, there will come buyers; buyers in America for well valued assets, and internationally. We owe no debt in foreign currency. There can be no collapse of the dollar. The idea makes no sense. The dollar can not collapse because there is a Federal Reserve that will control inflation, and inflation is the only threat to the dollar internally. Internationally, the Euro may continue to rise in value though Europeans do not wish this. But, there is a limit to such a Euro rise and investors are simply not going to hold currencies like the Yen or Yuan for long. A decline in the value of the dollar against other currencies will make our international corporations that much more profitable, and will add to American exports, but side effects such as rising interest rates though a problem can be controlled by the Fed.

Subject: Solow says tech comprises most growth
From: johnny5
To: All
Date Posted: Sun, Mar 20, 2005 at 08:45:03 (EST)
Email Address: johnny5@yahoo.com

Message:
So what will be the next BIG THING in the USA? Net usage is plateauing. http://it.slashdot.org/article.pl?sid=05/03/19/1823213&tid=95&tid=218 Nielsen Report Says Internet Usage Flattening Posted by timothy on Saturday March 19, @01:24PM from the adding-to-the-divide dept. Ant writes 'This BetaNews story says an analysis of major Internet markets revealed that the time netizens spend online at home has come close to hitting a plateau in many major markets. Nielsen//NetRatings, a syndicated rating system for Internet audience measurement, measured markets in Brazil, Germany, Spain, Switzerland, Sweden, the United Kingdom and the United States and found them to be maturing. In contrast, Australia, France, Hong Kong, Italy and Japan experienced double-digit growth. According to Nielsen//NetRatings' press release (PDF) and current news story concluded that mature markets are in wait of 'the next big thing' whereas emerging markets were rife with opportunity for companies online. Some of the growth engines cited in the report is the proliferation of broadband and societal changes in media consumption...'

Subject: marketocracy
From: johnny5
To: All
Date Posted: Sun, Mar 20, 2005 at 07:24:14 (EST)
Email Address: johnny5@yahoo.com

Message:
http://www.321gold.com/editorials/mauldin/mauldin031905.html ....There are some 70,000 investors who trade a hypothetical $1 million at the web site Marketocracy run by California investor Ken Kam. Only 2% have records of beating the S&P both long-term and monthly. Kam picks the top 100 managers to actually run a fund. However, last year, the fund lost 4% while the S&P 500 gained 11%. It's a tough world out there. Listen to how Rich Karlgaard of Forbes describes these top 100 investors: 'Few of Kam's top 100 attended Harvard Business School. That's the point. Wall Street investment houses, says Kam, recruit the wrong people. The top-drawer firms look for high achieving, well spoken generalists from the best business schools. But good investors, Kam says, tend to be savants with a passion. They're nerds. They're freaks. They're too young or too old. They eat junk food and stare at the monitor and perhaps forget to bathe. They live and breathe stocks. They tend to be sector specialists who know the underlying science, product cycles, supply chains and buyer habits in their sectors.' HAHA - that sounds like most of my buddies at silicon investor!

Subject: Comparison
From: Terri
To: All
Date Posted: Sun, Mar 20, 2005 at 07:02:49 (EST)
Email Address: Not Provided

Message:
Possibly the proper way to examine what rising interest rates and declining dollar values might mean is to look to the period from 1972 to 1982. What sort of investments held value through these years? What might hold value in the coming decade? To begin with, my sense is domestic large and mid cap value stocks, international developed market value stocks, and intermediate to short term bond funds.

Subject: Where is Value?
From: Terri
To: Terri
Date Posted: Sun, Mar 20, 2005 at 07:16:02 (EST)
Email Address: Not Provided

Message:
Jeremy Siegel gives us reason to believe that value stocks or stocks that are well valued relative to earning potential are to be preferred for long term investing. Siegel also favors international developed market investing. Then, Vanguard Value Index and International Value Fund and Europe Index may be attractive. Also, Vanguard Health Care Fund may be attractive. Vanguard also has a Health Care Index, as a Viper share. There is so much more on the value or growth at a reasonable price side.

Subject: Jeremy Siegel
From: Terri
To: Terri
Date Posted: Sun, Mar 20, 2005 at 07:23:15 (EST)
Email Address: Not Provided

Message:
This interview is most interesting - posted below in full: http://www.pbs.org/wsw/tvprogram/#retail March 18, 2005 GEOFF COLVIN: It isn't often that a famous and highly respected authority announces new findings that are practically guaranteed to change your most fundamental views about investing. But hold on, because some of those views are about to get shot down. Looking for innovative, fast-growing firms to invest in? You shouldn't be. Fighting to get a piece of the hottest new IPO? Don't waste your time. Resigned to accepting the returns of index funds? There is an even better approach. Jeremy Siegel of Wharton wrote an investing classic, Stocks for the Long Run, and his new book, The Future for Investors, may be even more influential. Jeremy, you start shooting down the core beliefs of many investors with the subtitle of this book, which is: Why the Tried and True Triumph over the Bold and New. What do you mean by that? JEREMY SIEGEL: It surprised me also. I used to think that one of the reasons the S&P 500 gave such good returns was all the new firms that kept on being added… COLVIN: Yes, people should realize that index is consistently being refreshed with new firms. SIEGEL: Updated, yeah. In fact since its founding in 1957, there's been almost 1,000 new firms that have been added. You know, Intel, Microsoft and all the rest. What I've found actually is the old original ones taken as a group actually outperformed all the new firms that came in the last half of the century....

Subject: Market fragility - dolllar strength?
From: johnny5
To: All
Date Posted: Sun, Mar 20, 2005 at 06:47:47 (EST)
Email Address: johnny5@yahoo.com

Message:
Certainly Terri many of these people are not as strong as you - but much more panicky no? The fact is that the markets are hyper-sensitive to these figures, and analysts pore over them like Kremlinologists. The fear that central banks are contemplating industrial action against the dollar—and the collective sigh of relief when it seems they are not—is part of a broader unease about the nature and solidity of America’s economic growth. Based, as it is, on mammoth consumption by both the private and public sectors—ie, on big trade and fiscal deficits—it needs foreigners willing to suspend disbelief and buy shiploads of securities denominated in a currency that has steadily lost value for about 40 years. ... This is perhaps not the week to air such apocalyptic concerns, though they are much on Buttonwood’s mind. In the end, what foreign central bankers have it in their power to do is to reveal before all the world that the mighty American economic empire has no clothes—not even a pair of little fuchsia-coloured shoes Starkers Mar 16th 2005 From The Economist Global Agenda The dollar may get another short-lived respite but it is heading inexorably down. The question is how much it takes with it ALL you need to get into Harvard Law School these days, it seems, is a pair of fuchsia-pink high-heeled shoes. Or so say Buttonwood’s daughters, reliably informed by an early-teen cult film, “Legally Blonde”. On the basis that they can probably manage the shoes, if not the grades, Buttonwood is paying close attention these days to exchange rates. Her hope is that in seven years’ time, if the dollar continues to slide against other currencies (and British universities continue to raise their fees), it might cost little more to send the thuglets to study in Cambridge, Massachusetts than it would to pay their way in Cambridge, England. What gives with the greenback? In two of the past three weeks, the dollar took a pasting on reports that various Asian central banks, whose purchases of America’s debt help it to go on borrowing and consuming, were planning to diversify their foreign-exchange reserves away from dollars. Bond yields spiked up (ie, prices fell) and shares looked glum too. Then, on Tuesday March 15th, keenly-awaited figures from America’s Treasury showed a big increase in net purchases by foreigners of American long-term securities. The net flow in January ($91.5 billion) was 50% up on December’s figure ($60.7 billion), way over January’s trade deficit of $58.3 billion. Hidden in the figures were some interesting trends: purchases of American shares picked up, for example—which suggests a genuine fondness for the dollar unlikely to be unwound soon. But so too did purchases from the Caribbean—home to even more hedge funds than The Economist’s own St James’s Street—which could be liquidated tomorrow. Mark Austin, chief of foreign-exchange research at HSBC, a British bank, points out that central banks bought about the same amount as before, while private-sector purchases increased sharply. Is that positive for the dollar or negative? The currency rallied, though questions persisted. The Treasury data tend to be volatile and in any event show only a portion of real flows. And one month does not a summer make. But taken together with other figures from the Federal Reserve showing an increase in February and early March in the securities it holds in custody for foreign owners, they do suggest two things. The first is that the full shock-horror scenario, in which Asian central banks dump the dollar and America promptly collapses, is way overdone. The second is that although Bretton Woods II is still in business, it is likely to change fundamentally. The fact is that the markets are hyper-sensitive to these figures, and analysts pore over them like Kremlinologists. The fear that central banks are contemplating industrial action against the dollar—and the collective sigh of relief when it seems they are not—is part of a broader unease about the nature and solidity of America’s economic growth. Based, as it is, on mammoth consumption by both the private and public sectors—ie, on big trade and fiscal deficits—it needs foreigners willing to suspend disbelief and buy shiploads of securities denominated in a currency that has steadily lost value for about 40 years. ... This is perhaps not the week to air such apocalyptic concerns, though they are much on Buttonwood’s mind. In the end, what foreign central bankers have it in their power to do is to reveal before all the world that the mighty American economic empire has no clothes—not even a pair of little fuchsia-coloured shoes. http://www.economist.com/agenda/displayStory.cfm?story_id=3761805

Subject: This was predicted at realty times
From: johnny5
To: All
Date Posted: Sun, Mar 20, 2005 at 06:36:39 (EST)
Email Address: johnny5@yahoo.com

Message:
A few posts down this was predicted but on primary mortages - perhaps this is just warming up the hot water the frog is sitting in: Congressional Tax Committee Takes Up Home Equity Loans By Kenneth R. Harney Saturday, March 19, 2005; Page F01 The hottest consumer-financing concepts in America -- home equity loans and credit lines -- have entered the sights of a key congressional committee. The staff of the influential Joint Committee on Taxation, which advises both the House and Senate on tax policy issues, has proposed eliminating interest deductions for all second mortgages and credit lines. The proposal is included in a wide-ranging 'options' paper that identifies revenue-raising measures to stem the federal budget deficit, simplify the tax code and 'improve tax compliance.' The staff paper also proposes eliminating the tax-free status of income received by homeowners when they rent out their properties for less than 15 days a year. The curtailment of home equity deductions would raise an estimated $22.6 billion in federal taxes between 2005 and 2009, according to the committee staff. The home rental proposal would raise far less, an estimated $100 million. more... http://www.washingtonpost.com/wp-dyn/articles/A45933-2005Mar18.html

Subject: The Dollar Will Not Collapse
From: Terri
To: All
Date Posted: Sun, Mar 20, 2005 at 06:18:47 (EST)
Email Address: Not Provided

Message:
The dollar will not collapse, but there should be more thought about a decline in relative value of the dollar. The dollar could well continue to lose value, possibly for several years, against several international currencies however. Dollar weakness may also raise interest rates, and if interest rates rise from here for any reason, bonds will lose value. Also, if there is need to worry about the dollar losing value in America, why should an investor hold long term bonds?

Subject: The Dollar Will Likely Lose Value
From: Terri
To: Terri
Date Posted: Sun, Mar 20, 2005 at 06:49:05 (EST)
Email Address: Not Provided

Message:
The question to be asked is, how can investors protect against a further decline in the international value of the dollar? The answer would seem to be, invest abroad. Diversification of assets helps in domestic terms, and international terms. International bond investing is expensive and risky in a climate when interest rates are rising internationally. So, a combination of international stocks and domestic stocks that have international components would seem a helpful strategy. A collapse of the dollar would mean a dollar would have no purchasing power in America, but how could that be as long as there is a Federal Reserve? A decline in value of the dollar however is a realistic possibility.

Subject: Re: The Dollar Will Likely Lose Value
From: johnny5
To: Terri
Date Posted: Sun, Mar 20, 2005 at 07:00:27 (EST)
Email Address: johnny5@yahoo.com

Message:
Well I think we are coming to consensus then, I hold a lot of XOM, and just put my mom into a lot of vangaurd international value fund, thank you for all the education on vangaurd - I hope they serve her better than the scudder fund she had. In your mind - do you think the vanguard international fund or the international vipers with thier .18% expense ratios versus .56% for the fund is better? Costs matter and I initially put her in the more expensive investment option before I realized there were international vipers.

Subject: Re: The Dollar Will Not Collapse
From: johnny5
To: Terri
Date Posted: Sun, Mar 20, 2005 at 06:31:54 (EST)
Email Address: johnny5@yahoo.com

Message:
Terri, why are you so confident the dollar cannot collapse? Many others are not so optimistic - is it because you think greenspan and the government will intervene to save the dollar and are not doing things to sacrifice it and inflate our way out of debt? Is it because we have trained economic hitmen that will save the dollar and trained central bankers that will save it with thier 5 tril reserves when 15 tril private investors run for the exists - I am not being fecitious or negative - I am just trying to understand why you are so certain the dollar will not collapse - why is this scenario a 'fantasy' to you but pete and I feel it is very very possible - why are we having such fundamentally different beliefs on this possibility and risk? Buffet says things are not good, secretary rubin and peterson and volker said things are not good, roach and stiglitz says things are not good, smart money like bill gates says things are not good, many smart investors on silicon investor boards say things are not good, and amongst this tidal wave of negativity - we have you Terri, standing steadfastly optimistic that a dollar crash is not possible. I am not pointing this out to attack you or hurt you - here is my thinking - if the majority of investors think like me and pete and short the dollar and flee it - you will be wiped out in your domestic philosophy - however if the majority of investors think like you and invest accordingly - pete and buffet will find out the hard way that the markets can remain what they consider irrational longer than they will remain solvent. The trick is to figure out the behavior of the crowd - are the masses gonna go long the dollar and domestics in the face of any news and no fundamentals can ever change that - or are they kinda edgy terri - are a couple words from old greenspan or the word uttered 'diversify' from the leaders of china or japan able to rattle and shake markets because they are so fragile? I am sure you don't want to see me lose money by buying bearx and the markets continue to rally for many years, but I am sure I don't want to see you lose money by going long the market when a potential collapse may be likely. I agree, if the dollar loses value, long term bonds - even non callable aaa insured ones will lose because you will be paid back in less valuable dollars - so even they will not be a good investment.

Subject: Pete called a dollar death
From: johnny5
To: All
Date Posted: Sun, Mar 20, 2005 at 06:10:19 (EST)
Email Address: johnny5@yahoo.com

Message:
Death of the dollar By Steven Irvine 16 March 2005 Stiglitz predicts dollar will cease to be world's reserve currency. In his keynote address to CSFB's Asian Investment Conference yesterday (March 15), Nobel Prize winning economist, Joseph Stiglitz predicted the demise of the US dollar as the world's reserve currency. The former World Bank Chief Economist told the audience: 'Reserve currencies must serve the role of being a good store of value. The dollar is no longer serving that function and there are alternatives.' Stiglitz said from the perspective of a European, if they had held dollar assets, they would have seen those assets decline in value by 40-50% in terms of their own currency, the euro. 'That's the same thing,' Stiglitz pointed out, 'as if they had seen their purchasing power eroded by 40-50% by inflation. This exchange rate instability is therefore as destructive to a currency's suitability to be a reserve currency as inflation is.' He pointed out that there are now alternative reserve currencies. 'There is obviously the euro, and in the future possibly even the Chinese yuan.' Stiglitz said the dollar's right to reserve currency status cannot be taken for granted, and its loss of this status is likely. 'We've seen it before with the gold standard and with sterling,' he added. His view on the dollar formed part of an overall pessimism he felt about the US economy. Listing figures for the trillions that would be required for Medicare, the privatization of social security, the war in Iraq and the cost of making Bush's tax cuts permanent, Stiglitz said: 'We are looking at a larger and larger fiscal deficit. The hope that it will be cut in half in the next five years is just not borne out by the details. It will be very difficult to make the magnitude of cuts necessary to make that happen.' Stiglitz added that policy decisions were also proving a longer term problem for the US economy. He said investment in science and technology was dropping and thanks to the war on terror the US was no longer benefiting from the influx of talented engineers and students from abroad. He predicted the US's lead in science - 'a legacy from immigration after World War Two' - would be lost to China and India. A major problem he also identified was the fall in the US savings rate from 5.8% of GDP in 2000 to 1.1% in 2004. Responding to a question from the audience that suggested the average American did not realize they were spending beyond their means, he said: 'I agree about the seriousness of the problem. Americans are currently benefiting from high housing prices and that makes them confident about spending. It has become a cultural phenomenon and has created a built-in fragility for the economy that makes me pessimistic about the US going forward.' Asked how Americans could be made to save more, he responded: 'The sad answer is we don't know how to get Americans to save more - but we do know how to get them to spend more and save less. That was Greenspan's great achievement in 2001.' Currently a professor at Columbia University's economics department, and a member of the Clinton cabinet, Stiglitz said that when the financial markets recognize that political gridlock would not see the deficit reduced, the dollar would weaken. In the worst case scenario, if everyone ran for the exits at the same time, it could lead to a 'financial crisis'. This was a problem since three times as many dollar securities were held by the private sector as by the world's central banks; and the former would lead the charge for the exits at the same time. 'The dollar was attacked in the 1970s and it could happen again.' http://www.financeasia.com/articles/A5A2F560-9027-7E17-4BCC138D9ECC2BCB.cfm

Subject: Bonds: Taxable or Tax Free
From: Terri
To: All
Date Posted: Sat, Mar 19, 2005 at 18:48:00 (EST)
Email Address: Not Provided

Message:
Before deciding on whether to invest in taxable or tax free bonds or bond funds, be sure of what tax bracket you are in. Also, ask yourself whether you wish a bond or bond fund especially at a time when the Federal Reserve is tightening.

Subject: If the dollar dies?
From: johnny5
To: Terri
Date Posted: Sun, Mar 20, 2005 at 05:31:19 (EST)
Email Address: johnny5@yahoo.com

Message:
I have contacted fmsbonds.com Terri, I am going to assume that you and I and pete have the minimum 15K to make an initial investment with them, thereafter they will sell you 5K chunks. Now if you hold to maturity a non callable tax free AAA insured bond, is there a risk if rates change? The major risk I see in that is that the dollars will fall in wealth and purchasing power - and buffet suggest this is a very likely scenario and has put his money where his mouth is. Many insiders are not holding their stock from what I have read - but into cash. If the dollar does not fall this should represent a good safe way to invest. But as Pete says, the dollar fall or collapse needs to be central to our risk planning. I believe bush and co will sacrifice the dollar - or may even be pushing that dollar slaughter to fix other problems. Given this why hold any tax or tax free domestic bonds? When the dollar could not be exchanged for gold in the 30's we had a crisis, when nixon completely took the dollar off the gold standard another major event happened - well there was still a few saving graces of the dollar - it was the reserve currency for oil trading - that is going to change - I am almost certain of this from everything I read. Also the ability of our government to increasingly tax a fastly growing population - well that has also lost it's steam - so what is left for the dollar but destruction? Warren and Pete say you need to SERIOUSLY consider this, are you SERIOUSLY considering a total dollar collapse Terri? If not, why not? Is it just alarmist mumbo jumbo?

Subject: Projected Returns for Stocks and Bonds
From: Terri
To: All
Date Posted: Sat, Mar 19, 2005 at 17:00:59 (EST)
Email Address: Not Provided

Message:
http://www.irrationalexuberance.com/shillersocsec.doc Jeremy Siegel projects American long term stock returns at 6.0% in real terms and corporate bonds at 2.3%. Robert Shiller projects 4.6^ and 2.7% for bonds and stocks. Goldman Sachs has the figures at 5.0% for stocks and 2.5% for bonds.

Subject: National Index Returns
From: Terri
To: Terri
Date Posted: Sat, Mar 19, 2005 at 22:12:03 (EST)
Email Address: Not Provided

Message:
http://www.msci.com/equity/index2.html National Index Returns [Dollars] 12/31/04 - 3/18/05 Australia 8.1 Canada 5.0 Denmark 8.0 France 3.8 Germany -0.6 Hong Kong -2.3 Japan 0.7 Netherlands 5.1 Norway 10.1 Sweden -0.0 Switzerland 1.6 UK 3.3

Subject: Jeremy Siegel
From: Terri
To: All
Date Posted: Sat, Mar 19, 2005 at 15:12:06 (EST)
Email Address: Not Provided

Message:
http://www.pbs.org/wsw/tvprogram/#retail March 18, 2005 GEOFF COLVIN: It isn't often that a famous and highly respected authority announces new findings that are practically guaranteed to change your most fundamental views about investing. But hold on, because some of those views are about to get shot down. Looking for innovative, fast-growing firms to invest in? You shouldn't be. Fighting to get a piece of the hottest new IPO? Don't waste your time. Resigned to accepting the returns of index funds? There is an even better approach. Jeremy Siegel of Wharton wrote an investing classic, Stocks for the Long Run, and his new book, The Future for Investors, may be even more influential. Jeremy, you start shooting down the core beliefs of many investors with the subtitle of this book, which is: Why the Tried and True Triumph over the Bold and New. What do you mean by that? JEREMY SIEGEL: It surprised me also. I used to think that one of the reasons the S&P 500 gave such good returns was all the new firms that kept on being added… COLVIN: Yes, people should realize that index is consistently being refreshed with new firms. SIEGEL: Updated, yeah. In fact since its founding in 1957, there's been almost 1,000 new firms that have been added. You know, Intel, Microsoft and all the rest. What I've found actually is the old original ones taken as a group actually outperformed all the new firms that came in the last half of the century. COLVIN: You mean if you had bought the S&P 500 firms in 1957 and just held them and forgotten about all the companies that came into it since then, you would have beaten the S&P 500 index with all the firms that have been added? SIEGEL: Yeah, absolutely. And we know the S&P 500 index beats most money managers. It's a very hard bogey for them to match. So it is really surprising. Just those original companies, follow through all the mergers and all the acquisitions, you beat the dynamic, updated S&P 500 index. COLVIN: Well, now this is just stunning. Of course the question is why, and you looked into that. Why? SIEGEL: The major reason is that firms that have been added to the index are overpriced. In 9 of the 10 sectors of the economy, I found that the new firms that were added subsequently to 1957 actually underperformed the original firm. It isn't that they were growing any slower. In fact many of them were growing faster. It's just that the public getting so excited about these firms, once they get to be a big market value, the S&P is induced to put them in the index. That's the wrong time usually to buy a stock. COLVIN: Okay, so this is where we really start shooting down investment beliefs held by so many, many people. Let me just state some of them, and you tell me what's wrong with them. You want to invest in innovative, fast-growing firms. SIEGEL: Well, what is wrong about that is everyone wants to invest in innovative, fast-growing firms, and they push up the price way too high. And no matter how fast a firm is growing, you must pay attention to the price. And I think that that's so very, very important, missed by a lot of investors. COLVIN: Well, in fact you have identified something that you call the growth trap. What is it? SIEGEL: Yeah, that's really the first chapter of the book, the Growth Trap. The growth trap is people thinking that the best performance they can do in the market is just picking those firms that grow the fastest or those sectors that grow the fastest, or as I find later in the book, even those countries that grow the fastest. And it turns out that very often those are the firms, the stocks that under-perform the market. COLVIN: So they're growing fast, profits are growing fast, right? SIEGEL: Right. COLVIN: But they're bad investments. SIEGEL: Because you're paying too high a price. You know, I introduce early in the book a principle called the basic principle of investor returns, which basically says it's not how fast the earnings of a company are growing; it's how fast they're growing relative to what investors had expected them to grow. That's built into the price. That's what we call the P/E ratio. You've got to look at both. COLVIN: And so what follows from that I think so many people don't understand is that even if profits grow slowly, if it's a little faster than what was expected, it's going to be a good investment. SIEGEL: Oh, yes. I mean actually some of the great investors, Peter Lynch, and we know even Warren Buffett, they're not always looking for the fastest-growing. They're looking for the under-priced stocks, those that push out cash, they may be growing slower, but given their price, investors are going to come out ahead. COLVIN: You did a very interesting exercise in this book, where you said let's suppose it's 1950, and you were supposed to decide am I going to invest in Standard Oil, a big, even then an old industry, an old company, really big, arguably best days behind it, or am I going to invest in IBM? In 1950 the dawn of the computer age, exciting, high-tech, and in fact we know that both companies have grown and survived and prospered. But what did you find when you looked at them as investments in 1950? And by the way, the conventional view would be well, obviously you would have chosen IBM, on the launching pad of the computer revolution. SIEGEL: Absolutely. In fact, IBM earnings grew more than 3 percent per year faster than Standard Oil of New Jersey over the next half century. Their earnings grew faster, their dividends, their market value, their sales, but the winner was Standard Oil of New Jersey. An investor who bought that stock, reinvested the dividends -- and that's a very important component of long-term returns, as I talk about later in the book -- reinvested those dividends, ended up with a greater amount of wealth than someone getting in on the greatest technology stock at the beginning of the computer age. COLVIN: It is just stunning. Now you mentioned dividends, and this turns out to be another important point that contradicts another core belief of many investors, which is dividends are bad because your returns are getting taxed twice; one when the company earns the profits, and a second time when they're paid to you as dividends. So it's better to find companies that reinvest the cash rather than companies that pay it out in dividends. This turns out to be wrong. SIEGEL: It turns out to be false. Now we have two things that we have to look at. President Bush, obviously we reduced that dividend tax, so that difference between capital gains and dividends is much smaller than it was before. But what I found was that the dividend reinvestment was that margin by which many of those so-called slower growing firms actually beat the faster growing firms in the long run. You know a lot of others say firms that pay dividends, they don't have growth opportunities. Well, that proved to be wrong, too. A lot of those firms that used their cash for growth opportunities, actually they were buying overpriced firms, too. Then the technology industry, we saw that in '98 and '99, 2000. So it turns out returning that money to you, having you reinvest, the best proposition. COLVIN: Even though you had to pay the tax on it, you were still better off. SIEGEL: Most of the time you were still better off. Those dividend-paying firms really did better. COLVIN: Well, this is all just getting more and more remarkable. So let's move on to the next core belief of a lot of investors, which is if there's an IPO, especially a sort of a hot IPO, if by the remotest chance you can get it at the offering price -- and of course most of us civilians cannot get it at the offering price -- but if you can get it at the offering price, you should absolutely grab it because these things virtually always go up. SIEGEL: Yes, they go up, but sell it right away. Mom, don't hold it. What's really amazed me is I thought, well, if you got it at that offering price, it popped 100, 200, 300 percent, you'd be all right on the long run. COLVIN: Because it would never go down so much. SIEGEL: It would never go down by more than its IPO price or certainly not more than an index that was matched to small stocks. So what I did was looked at IPOs from 1968, all of them to the present. Let's assume you bought all of them then, even from that offer price, got the pops when they did occur, you fell behind either the S&P or a small stock index over 90 percent of the time. It was really amazing. COLVIN: It is really amazing. SIEGEL: Because certainly once it pops, people know, hey, you know, that may be a too high price, but I thought if you bought them at that offer price, you'd still be good in the long run. No. They're really hot potatoes. Get rid of them. Take your pop and be thankful. COLVIN: All right. Let's talk about sectors now, because this is the way a lot of people look at it. They say well, look, I'm going to identify the big picture, the fast-growing sectors. And you did this analysis, too. SIEGEL: Yes. COLVIN: Now you would think that if you buy a sector fund, right, and you have picked the fast-growing sectors, you're going to get the losers but the winners also, and you're probably going to do okay. Not true, right? SIEGEL: Not always. In fact, of the fastest-growing sectors that we had -- we had the healthcare sector, we had the financial sector, an information technology sector -- only healthcare in the long run did well for investors. Financial actually, even though it was the biggest expanding sector from 1957 to the present, actually fell behind the market. COLVIN: In investment returns to investors. SIEGEL: In the S&P 500, fell behind in investment returns. And even information technology, it slightly did better, but that was only because of a few years of IBM performance right at the beginning of the index. All the new firms that have been added to that information technology index subsequently, as an average, underperformed the S&P 500. COLVIN: You found something that just floored me, which was that the railroad sector outperformed the market? SIEGEL: Right, the railroad sector. This is really amazing. Now of course the railroad sector took a big dip during the Depression, after the war. Everyone had given up on the rail sector. No one wanted to touch the rail sector. The thing is that the rails figured out how to make money, and they were turning really good dividends, and so they were really what we call deep value stocks. It wasn't that they were growing so fast, but when you reinvested those dividends, I was so surprised it outperformed the average. By the way, another tremendous shrinking sector in terms of proportion of the market that also way outperformed was the energy sector. Over 25 percent of the market in 1957, less than 10 percent today, and yet it outperformed the S&P 500. COLVIN: As an investment. SIEGEL: As an investment. COLVIN: Now in Stocks for the Long Run, your previous book, your advice to investors was you should take all of the money that you plan to put in stocks and put it in an index fund that tracks the broadest possible index of stocks. After this research, you have changed that advice. Is that right? And what is it now? SIEGEL: Yes, well I still believe you need that diversification, so I say take half of your commitment and index it to the market. And by the way, there's a very big international component there that I have raised. The other half I like going into investments with high dividends, low price/earnings ratios. I like energy sector, pharmaceutical sectors, consumer staples, brand name companies, expanding worldwide. Something I call the corporate El Dorados that have done so very, very well. I talk about the 20 best performing companies. Tilt your portfolio in that direction, and I think you're going to get a couple percent or even more on these broad-based indices. COLVIN: Above the indices. SIEGEL: Above the indices. COLVIN: And you call this specifically the DIV strategy, right? SIEGEL: Yes. COLVIN: Which stands for D is dividends… SIEGEL: I is International, and international, a very heavy focus on international investing, and V is looking at valuation. The valuation, the price you're paying for those stocks in terms of dividends and earnings. COLVIN: Well, let's talk about each one of them in a little bit of detail, because this is very helpful stuff. The D, dividends, look for companies that pay how big a dividend? SIEGEL: Well, you know what I did was I looked at all the S&P companies from 1957 to the present. If you would have bought the 20 percent highest dividend payers and just rolled it around every year, you'd outperform the market by 3 percent a year for nearly a half century. COLVIN: And three points a year for 50 years is mammoth. SIEGEL: Oh, yeah. You're going to be triple, quadruple the sum that you would be if you were just in the index. In Stocks for the Long Run, I said maybe 25 percent of your equity portfolio you should be international. I've now pushed that to 40 percent. I really believe a lot of the growth is going to be outside the United States in the next 20, 30, 40 years, and you're going to need that diversification away from just having U.S. companies. COLVIN: Well, and so when you say international, you mean companies based outside the United States? SIEGEL: Headquarters outside the United States. In other words, either in Europe, obviously, or Japan. Something we call the EAFE index. We have to have emerging markets, but I caution you not to overweight there. But in other words, where the headquarters are not in the U.S. That's the current definition, which I think might actually change in the future, but the current definition of where a company is located, not where it sells or where it produces, where the headquarters are located. I believe you should go up to 40 percent. COLVIN: But you pointed out that if you invested in China, the fastest growing economy on earth, you wouldn't have done so well. SIEGEL: That was a shocker. You know, in 1992 to the present, 12 years, the fastest growing country by GDP, by virtually any measure, is China -- the worst dollar returns. And you know why? Again, everyone was so excited, including the Chinese, that they just bid the price of these stocks so high. They couldn't last, gave people negative returns. Actually $1,000 invested then turned into $300 by the end of 2003. COLVIN: It's incredibly surprising. Okay, the V in DIV is Value. SIEGEL: Is valuation. COLVIN: And this of course is the great classic basis for investing. All of the most successful investors have done so on that basis. What's your mechanism for identifying the stocks that a person should buy for the V part? SIEGEL: Well, you know, there's two groups of stocks that are important here. First of all, I did find that those that had the lowest price/earnings ratios did tend to outperform a value-based strategy. But there's that group of stocks that grew very fast but had reasonable prices. I call them the corporate El Dorados. They were the 20 best performing companies of the original S&P 500 companies. They were fast growers, but the interesting thing is that investors paid only a couple points over the average price/earnings ratio for these stocks. We sometimes call these stocks GARP, growth for… COLVIN: Growth at a reasonable price. SIEGEL: Growth at a reasonable price. That group of companies that has a history, that has brand name, that has international exposure and is increasing their markets, I've found that those are value stocks in a slightly different way. Not that they're low P/E stocks, but their P/Es are reasonable relative to their growth prospects. COLVIN: Essentially they bucked the big trend that you identified. They were fast growing, and yet you didn't have to pay a big price for them. SIEGEL: Right, because many of the people said, oh yeah, this company is fairly good, but maybe I'll give it 25 or 30 P/E while they were chasing these exciting technology and telecom and everything else at 70, 80, 90 P/E. Well, those other companies couldn't match that price, but these companies were really well worth it. And it was interesting when I looked at that list with Philip Morris and the pharmaceuticals. Actually of the top 20 original companies in the S&P 500, 90 percent were in two sectors: pharmaceuticals and consumer staples, the brand names that are known around the world. COLVIN: Brand names, right, perceived now as sort of non-sexy businesses. SIEGEL: Oh, yeah, you know pharmaceuticals certainly have taken huge hits. On a historical basis, they're about as cheap as you're ever going to get them. So if you don't think they're going to fade away, there's an opportunity there. But even the companies that have had this international exposure, brand name is so important in the developing world. In China and India they trust brand name. If you've got a skillful CEO that says I've got the brand names, you know, from Procter & Gamble to Coke to Pepsi, to Wrigley to Heinz, and we can keep on going down and down. Wow, those are the companies over time have produced tremendous returns.

Subject: Terrific Interview
From: Terri
To: Terri
Date Posted: Sat, Mar 19, 2005 at 21:11:10 (EST)
Email Address: Not Provided

Message:
This interview needs to be carefully considered.

Subject: In Life on the Mekong
From: Emma
To: All
Date Posted: Sat, Mar 19, 2005 at 13:54:12 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/19/international/asia/19mekong.html?pagewanted=all&position= In Life on the Mekong, China's Dams Dominate By JANE PERLEZ CHIANG KHONG, Thailand - For countless generations, fishermen along the Mekong River have passed their lore and way of life from father to son: the rhythms of the water, the habits of the many kinds of fish, the best nets and traps to use to survive and prosper. But Sri Sumwantha, 70, one of the old men of Asia's majestic river, has left his delicate pirogue tied up at the riverbank for longer stretches than usual. Through green bamboo stands, he has watched the caramel-colored current slow and surge unpredictably and his catch diminish. Now, he worries how much longer his family can live off the river. The reason is China. China's ravenous appetite for hydroelectric power at home and its thrust southward into Southeast Asia in search of trade is changing the very character of the Mekong. This is true not only in China itself, but also for the five nations and 60 million rural people downstream for whom the great river serves as their life's blood. Several hundred miles upstream from Sri Sumwantha's simple home, China has completed two dams. It is pushing ahead with three more and has three others on the drawing board. Just about 70 miles away from here, China has blasted reefs and rocks at the border of Laos and Myanmar to clear the way for its trading vessels to reach new markets deep into Laos. The effects of the river projects that serve China's colossal upstream ambitions have been visible for several years, but are growing more worrying, say conservationists and those who live on the river. The fish species found in this stretch of the Mekong in northern Thailand dwindled from 100 to only 88 last year, said Sayan Khamnueng, a researcher with the Southeast Asia River Network, an environmental group. Water levels and temperatures have fluctuated widely, threatening the river environment and disrupting the livelihoods of the fishermen and others who depend on the $2 billion annual catch of migratory fish. For the fishermen, their revered river, once nearly untouched and steady in its moods, has turned into a fickle sea. 'In the past the river was up and down like nature - every three or four days up and down,' said Tan Inkew, 72, a fisherman who lives in Meung Kan village. 'Now the river is like the sea - up and down, up and down very quickly.' Protests by Mr. Tan and other fishermen helped persuade the Thai government to stop China from blasting the rapids in Thai waters near his home, between the port of Chiang Saen and Chiang Khong. 'We protested outside the Chinese Embassy in Bangkok,' Mr. Tan recalled. 'We told them to stop blasting - and if they don't stop, we'll fight them.' Still, he worries about the impact of China's dams as well. His recalled how his son was recently out on the water for nine hours but 'did not catch one thing.' While Mr. Tan and his neighbors may have scored a small victory, clearly China cannot be kept at bay for long. The Mekong has been protected through the ages by a lack of development, and more recently by wars in Vietnam, Cambodia and Laos, as it winds its way on a brawling 2,870-mile journey from the Tibetan plateau to its delta in Vietnam. But today the countries downstream from China - Myanmar, Thailand, Laos, Cambodia and Vietnam - have settled into an era of relative peace and have shed their old fears of China, indeed, are currying favor. Booming Thailand is seeking more trade with China. Impoverished Laos and Cambodia want China's aid to kick-start their economies. Myanmar shares China's passion for hydropower to supply future growth. 'China seems to be doing this with impunity,' said Aviva Imhof, director of Southeast Asia programs at International Rivers Network, a nongovernmental group in Berkeley, Calif. 'The Mekong is slowly being strangled to death. Why aren't the downstream governments challenging China's activities?' The concern extends beyond environmental groups and fishermen. Ted Osius, until recently the State Department's regional environmental affairs officer and once a senior White House adviser to Vice President Al Gore, suggests that an unchecked China could turn the Mekong into an ecological disaster, akin to the Yellow River and the Yangtze River. 'China has a poor record on river protection,' Mr. Osius said in a speech in Bangkok, noting that 80 percent of the Yangtze's historic flood plain has already been cut off by a dike and levee system. Today China's economic and political power along the Mekong is unrivaled. More than ever, it is being strengthened and extended through growing trade and diplomatic ties and its use of new multilateral tools, like the Asian Development Bank. The bank, a major lender for poverty alleviation, was until now dominated by Japan. China contributed to its capital fund for the first time in 2004 - gaining more power over how the bank's loans are distributed. The impact was immediate. The bank added a new vice president, Jin Liqun, a former deputy finance minister in Beijing. Most important, the bank's grand plan for roads, bridges and a telecommunications network to knit southern China together with the five other Mekong River countries - a plan 10 years in abeyance - got a quick boost. Long-stalled work was suddenly under way on a 152-mile road from Yunnan Province across untamed territory to Houey Xai, a Laotian river town just a few hundred yards across the Mekong from Sri Sumwantha's village. Although relatively short, the road provides the vital link to China. A bridge is also in the works to replace the little ferryboats now used to cross the river. By the end of the decade, China could be connected by roads that cross the Mekong, head down to Bangkok and then run on to Malaysia and finally Singapore. 'China's donation gives them a seat at the donor's table,' said Bruce Murray, the bank's representative in Beijing. 'When they give, donors always have a certain agenda.' China's new clout can be felt on other important projects as well. One of the most controversial is a $1.3 billion dam proposed for the Theun River, a major Mekong tributary in Laos, a plan that has been fought over for more than a decade. The World Bank is expected to approve loan guarantees for the dam in March. American diplomats say they have quietly supported the World Bank's role - its first dam project in a decade - for fear that otherwise China will step in. 'The Laotians have told the World Bank that if the bank does not guarantee the dam and make it go ahead, they will turn to the Chinese,' an American official said. The United States is reluctant to have China build and manage one of Southeast Asia's biggest dams, he said. China, diplomats and conservationists say, would be much less fussy about the dam's impact than the consortium seeking World Bank support, led by Electricity Generating Authority Thailand (EGAT) and France's state-owned Electricité de France. Here in Chiang Khong, where the fishermen's bamboo houses are nestled along the banks, the changes to the river that China has already made are quickly causing a way of life to recede, along with the bounty of the Mekong's waters. Mr. Sayan, of the Southeast Asian River Network, said fishermen had stopped selling their fish at the main market in Chiang Rai. 'They don't have enough,' he said. In extreme cases, the fishermen have given up and become laborers, unloading the trading vessels from China that dock at Chiang Saen, laden with fruits and vegetables, electronics and cheap garments. 'As laborers they become impoverished and are miserable,' said Chainarong Srettachau, the director of the river network. Some fishermen have begun supplementing their incomes with crops. But crops are being hurt, too. China's upstream dams are also holding back as much as 50 percent of the fertile silt that is essential to the soil and that normally flows down river, according to conservationists. Erosion is also worsening. At Pak Ing, a small village near Chiang Khong, fishermen pointed to a 12-foot-high wall of exposed soil, a muddy mini-cliff where the water, flowing faster because of blasting of the rapids, has cut into once gently sloping riverbanks. The next step will be to erect concrete banks to hold back the land. Farther downstream, the effects may be even more severe. In Cambodia, an intricate ecology and age-old economy depend on the ebb and flow of the great lake fed by the Mekong, Tonle Sap, which can swell fourfold during the rainy season. The rhythm of life is built around the seasonal tides and the bounty that the waters provide. The fish catch dropped by almost 50 percent last year, according to the Mekong River Commission. In many areas, the low catches were caused by the sudden fluctuations that occurred when dams in China released water to allow easier passage for trading vessels, said Milton Osborne, an Australian historian and an expert on the Mekong. The water from the dams is also much colder than the water downstream, affecting the fish, which are extremely sensitive to changes in temperature, Mr. Osborne wrote last year in a paper titled 'River at Risk' for the Lowy Institute, a public policy group in Sydney. Large species in particular had fallen off, he said. The outlook for the river and its vast ecosystem was not promising, he added. 'Because of the enormous imbalance of power between China and the downstream countries,' he said, 'it is highly unlikely that there will be a halt to China's projected dam building program on the Mekong.' But Mr. Chainarong of the river network was less pessimistic. 'Two or three years ago, people said we would never be able to stop China blasting the Mekong inside Thailand,' he said. 'But we did.' 'One good thing,' he noted, 'is that China doesn't want to have conflict downstream. That's the challenge. The situation is up to China: does it want to go friendly or hostile?'

Subject: Private Pension Accounts in Texas
From: Emma
To: All
Date Posted: Sat, Mar 19, 2005 at 11:43:54 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/18/politics/18texas.html?pagewanted=all&position= On Texas' Coast, a Laboratory for Private Accounts By SIMON ROMERO GALVESTON, Tex. - As governor of Texas, George W. Bush had an up-close look at what many advocates of individual Social Security investment accounts consider a laboratory for how such a system might work: Galveston County's retirement system. In 1981 officials in Galveston, a seafront city on the Gulf of Mexico opted out of Social Security along with neighboring Brazoria and Matagorda Counties and chose instead to plunge their county governments into the unknown territory of offering private retirement accounts. Hundreds of employees in these counties have since retired under the system and more than 4,000 current employees make deposits into their private accounts each month. But there is intense debate over what lessons to draw from Galveston's experience and whether a government retirement system should help adjust income disparities. Some prominent retired officials swear by the system, saying it has allowed them to retire richer than if they had stayed with Social Security. 'You basically get back what you put in,' said Ray Holbrook, 78, a former county judge who retired in 1995. Mr. Holbrook had been an early supporter of the plan. Others, mainly retirees with lower income, have found their small nest eggs eroded by inflation or gone altogether after choosing a lump-sum payment instead of monthly checks. 'I don't know what I would do without Social Security,' said Norma Samuels, 61 , a retired food services manager who took the $22,000 she had put in her account over eight years as a lump-sum payment because her husband had died and amassed unpaid medical bills. Ms. Samuels still receives Social Security through survivor's benefits and is waiting to collect her Social Security benefits from a previous job when she turns 65. The Galveston plan also includes survivor and disability benefits that sometimes exceed those of Social Security. Still, few of the participants in the plan are explicitly critical of the system, perhaps because many say they feel they have greater control over their investments. Most county employees here also benefit from a separate county pension, which gives them a cushion. The Houston investment firm that designed the Galveston plan invests employees' money mostly in safe but low-yielding securities, providing participants with quarterly updates on their investments and the opportunity to withdraw their money in a lump sum upon retirement or in installments over several years. 'I have the luxury of completely forgetting about Social Security,' said Kirk Greene, 42, an information technology manager who began working full time for Galveston County with a salary of about $14,000 a year in 1986, five years after it adopted the system. Mr. Greene said he now had about $120,000 in the Galveston plan in addition to some $130,000 in the county's pension plan. Mr. Greene, who earns about $75,000 a year, said he expected to retire in nine years. 'I'll be going fishing when many of my friends will still be working,' said Mr. Greene, cherishing his ability to start drawing his money at 51, an option not available under Social Security. 'I feel able to benefit from the money that I myself put in.' Under the Galveston plan employees put about 6.1 percent of their salaries into their accounts, roughly the same as the 6.2 percent withdrawn from most workers' paychecks for Social Security. In addition, the three county governments then pay about 7.7 percent of employees' salaries, slightly higher than the 6.2 percent deposited in Social Security by most employers. The majority of the plan's money is invested in annuities, financial securities sold by insurance companies that provide fairly predictable rates of return. The exception is in Brazoria County. Some employees there are smarting after losses in their accounts because of an investment option, created around the time of the stock market's peak in 2000, allowing them to put some of their money in stocks with higher risks. Most of those losses have been recuperated in the last few years. The insurance company, rather than the plan's participants, pays a management fee of less than 1 percent of the plan's assets. First Financial Benefits of Houston, the creator and administrator of Galveston's plan, estimates that the plan has earned an average of 6.5 percent in annual returns since its inception, though that figure was influenced by the relatively high interest rates of the 1980's. The plan currently returns about 4 percent a year. Richard F. Gornto, the president of First Financial Benefits, helped design the plan and said his estimates showed that all retirees would do better financially under the county's plan than they would have under Social Security. But others who have studied the plan and used different assumptions disagree. Critics contend that employees with higher incomes do much better than those with lower incomes and that over time the fact that the returns are not indexed for inflation make them a worse deal than Social Security. A study in 1999 by the Social Security Administration, for instance, found that after 20 years of retirement, all of the plan's benefits, even for wealthier retirees, would be lower relative to Social Security. Eric R. Kingson, a professor of social work at Syracuse University who has studied the Galveston plan, also says it is a threat to the 'quiet redistribution' of wealth under Social Security that provides poorer retirees with a higher share of their pre-retirement wages than it does to their richer counterparts. For instance, the study by the Social Security Administration found that married low-income workers retiring in 2045 under the Galveston plan would receive initial benefits equivalent to about 60 percent of Social Security while a single high-income worker would receive payments equivalent to about 140 percent of Social Security. In 1983 Congress ended the option of allowing counties to drop out of Social Security but exempted those who had already left it. Another study of the Galveston plan, by the Government Accountability Office in 1999, projected that a low-income worker retiring in 2026 after 45 years would receive $1,028 a month under the Galveston plan compared with $1,366 under Social Security. The G.A.O. also found that those with larger incomes did better. A worker with a median income would receive $1,367 a month under Social Security as opposed to $2,024 under the private plan. An employee in a higher income range would receive $1,898 in Social Security compared with $4,089 a month under the Galveston Plan. (The G.A.O. defined a low-income salary as $17,124, median income as $25,596 and high income as $51,263.) Mr. Gornto, of First Financial Benefits, said that if a plan like Galveston's were tried on a national scale, it could always be altered to deal with any problems. He noted that the plan had already made changes to features deemed unwise, recently eliminating the option of hardship withdrawal. 'Some people like to see us here in Texas as unsophisticated, with chewing tobacco in our mouths,' Mr. Gornto said in an interview. 'The opposite is true. We can do our own quiet redistribution within the plan if that's needed,' he said, explaining that a formula could be used to shift some of the plan's resources to poorer retirees. For all the debate, participants in the plan tend to have few complaints about returns as long as they know that their accounts are gaining in value. 'It's known that we've got one of the best retirements in the law profession in Texas,' said Robert Dodd, 36, a sheriff's deputy who recently moved to Galveston. A 22-year-old colleague, Dustin Helms, on a cigarette break with him, took that thought a bit further. 'Social Security's a joke, and everybody knows it,' Mr. Helms said. 'By the time I retire it's not going to be around. I might as well stick around here.'

Subject: A Poor Plan
From: Emma
To: Emma
Date Posted: Sat, Mar 19, 2005 at 11:55:40 (EST)
Email Address: Not Provided

Message:
Notice the Galveston public employee pension plan costs much more than Scoial Security and the return to private accounts has been poor, especially poor to workers below median income.

Subject: Why are Returns so Low
From: Emma
To: Emma
Date Posted: Sat, Mar 19, 2005 at 13:46:35 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/18/politics/18texas.html?oref=login&pagewanted=all&position= 'The insurance company, rather than the plan's participants, pays a management fee of less than 1 percent of the plan's assets. First Financial Benefits of Houston, the creator and administrator of Galveston's plan, estimates that the plan has earned an average of 6.5 percent in annual returns since its inception, though that figure was influenced by the relatively high interest rates of the 1980's. The plan currently returns about 4 percent a year.'

Subject: Re: Why are Returns so Low
From: David E..
To: Emma
Date Posted: Sun, Mar 20, 2005 at 01:14:18 (EST)
Email Address: Not Provided

Message:
'The insurance company, rather than the plan's participants, pays a management fee of less than 1 percent of the plan's assets. First Financial Benefits of Houston, the creator and administrator of Galveston's plan, estimates that the plan has earned an average of 6.5 percent in annual returns since its inception, though that figure was influenced by the relatively high interest rates of the 1980's. The plan currently returns about 4 percent a year.' Note how carefully the less than 1% is defined. This is the insurance companies management fees the creator and administrator is talking about. He doesn't mention how much he gets in sales commissions and administration fees. Note that 6.5 1 1 is an 8.5% return which is not exceptional for the 80's. The current 4% return is about what my buddy gets from his newer rolled over annuities. Here is a link to an article in the Guardian. The GAO did a study in 1999 and came up with the same analysis(mentioned in the Guardian article) This week on CBN I saw TV coverage of Galveston's system. Everybody on TV in CBN land was very happy with their pension. No mention was made of the GAO study. And CATO also for some reason seems to skip the opportunity to refute the GAO study.

Subject: Re: Why are Returns so Low
From: Terri
To: David E..
Date Posted: Sun, Mar 20, 2005 at 06:05:56 (EST)
Email Address: Not Provided

Message:
David, you are a wonder. This is an excellent analysis. We want no Galveston plan for Social Security. Please read the interview with Jeremy Siegel. I will add later.

Subject: Re: Why are Returns so Low
From: johnny5
To: Emma
Date Posted: Sat, Mar 19, 2005 at 14:14:58 (EST)
Email Address: johnny5@yahoo.com

Message:
4 percent per year- BWAHAH - the people at fmsbonds told me I could get fla tax free munis and get paid 4.8 percent for my uncle.

Subject: Broadband and Phone Lines
From: Emma
To: All
Date Posted: Sat, Mar 19, 2005 at 10:29:15 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/19/technology/19phone.html?pagewanted=all&position= Dangling Broadband From the Phone Stick By MATT RICHTEL SAN FRANCISCO - To gauge the potential consumer impact of the consolidation sweeping the telephone industry, look no further than the silver-toned plastic phone gathering dust on the desk in Justin Martikovic's studio apartment. Mr. Martikovic, 30, a junior architect who relies on a cellphone for his normal calling, says he never uses the desk phone - but he pays $360 a year to keep it hooked up. 'I have to pay for a service I'm never using,' he said. He has no choice. His telephone company, SBC Communications, will not sell him high-speed Internet access unless he buys the phone service, too. That puts him in the same bind as many people around the country who want high-speed, or broadband, Internet access but no longer need a conventional telephone. Right now, their phone companies tend to have a 'take it or leave it' attitude. Consumers 'are not forced to go with SBC,' said Michael Coe, a company spokesman. 'If they just want a broadband connection, I'd recommend they look around for people who can provide just a broadband connection.' The nation's other two largest phone companies, Verizon Communications and BellSouth, have similar policies: broadband service is available only as a bundle with phone service. That means, even as high-speed Internet service has become one of the most quickly adopted technologies of the computer era, there are few options for the tens of millions of Americans trying to upgrade their dial-up connections. Some lawmakers and consumer advocates say the issue should be on the agenda as the government considers the market impact of two proposed big telecommunications deals: SBC's planned $16 billion acquisition of AT&T, and Verizon's $6.75 billion offer for MCI, which is being challenged by a rival offer from Qwest Communications. For many consumers, the main alternative to broadband from the phone company is the local cable company. But cable broadband prices tend to be higher - as much as $60 a month for access, compared typically with $40 or less for phone company broadband. And the cable companies prefer to sell the service as a package with television that can easily exceed $100 a month. That is assuming cable is even available, which it is not in Mr. Martikovic's apartment in the Nob Hill section of San Francisco - or in 10 percent of the nation's households, for that matter. Mr. Martikovic says that he has resigned himself to paying SBC $30 a month for a phone bill and $30 for Internet, in addition to $100 for a mobile phone from Sprint. 'I bet half of my friends are in this exact same situation,' he said. The question of broadband's availability is almost certain to become part of the policy debate as the Justice Department and the Federal Communications Commission rule on an eventual acquisition of MCI and whether SBC can buy AT&T. And two weeks ago, the House Energy and Commerce Committee held a hearing to discuss the consolidating market power of the phone companies. Consumer advocacy groups, including Consumers Union, say they plan to ask the F.C.C. to address the lack of 'à la carte' broadband when the agency reviews the proposed takeovers. Despite the market bottlenecks, broadband is increasingly in demand for its ability to let users zip e-mail back and forth with big photo or music files attached; or to play online games; or to quickly open Web pages loaded with video and audio extras. Of the nation's 74.5 million Internet households, an estimated 39 percent now have broadband - up from 36 percent of Internet households at the end of 2003. So popular is the service, and so few the alternatives for most consumers, that the three biggest regional Bell companies - SBC, Verizon and BellSouth - have been able to expand their share of the Internet broadband market even while declining to sell the service separately. The cable companies are still in the lead, having moved more nimbly than the phone companies in the early days of broadband back in 2000. But the phone industry's broadband share is now 37 percent, up from 32.7 percent at the end of 2003, and it continues to grow. While critics say the phone companies are simply squeezing millions of extra dollars from consumers and making it harder for people to move to cheaper Internet telephony in place of conventional phone service, the three big Bells argue that selling stand-alone broadband is not a simple proposition. In the case of Verizon, the nation's largest phone provider and the dominant one in the Northeast and Middle Atlantic states, the company says that it has based its technology and billing systems on delivering service to individual phone numbers. Verizon has said it is working to develop a stand-alone broadband offering that could be available as soon as the end of the year. 'It's just very complex,' said Michael D. Poling, Verizon's vice president for broadband operations and processes for Verizon. 'It's changing the guts of the systems and processes we've built for five years.' But the smallest of the Bells, Qwest, which operates primarily in the Rocky Mountain states and is struggling to grow, has been willing to offer à la carte broadband for more than a year. One satisfied Qwest customer is Chad Jorgenson, 25, a part-time student in Boise, Idaho, and an intern at a computer chip maker. By cutting off his traditional phone service, he said, he had been able to reduce his monthly bill to $47.92, from $71.40. (That bill could be lower still, but he opted for a particularly high speed of service.) Richard C. Notebaert, the company's chief executive, said Qwest spent just three days and $134,000 to get regulatory approval to offer the service, now a year old. The company now has around 25,000 stand-alone broadband customers. 'We've had no technical problems; we've had no billing problems,' he said. 'If the consumer wants it, why are you stiffing them?' In defending their marketing practices, the other Bell companies argue that they are sinking billions of dollars into building Internet-based networks that will eventually replace their conventional telephone technology even as they are struggling to cope with the erosion of their local telephone business. Last year, the phone companies lost 5.4 million residential phone lines as more subscribers chose to rely mainly on wireless service and abandoned second lines that had been used for dial-up computer modems. Another threat to the phone company revenues will be Internet-based phone service in which calls are transmitted over high-speed Internet lines, as digital packets, much the way e-mail is transmitted. Once customers have broadband Internet access, they are not limited to their local Bell company to be the provider of Internet phone service. A relatively new Internet phone company, Vonage, now has 550,000 customers who use its services over phone or cable broadband access lines. And so while Internet telephony is a business the Bells have all said they plan to embrace, some critics say the biggest Bells are using their current market power to slow its development. The issue might soon come before regulators and Congress. Representative Edward J. Markey, Democrat from Massachusetts, said he would like to see the Bells' reconsolidated power discussed as part of a pending rewriting of the increasingly outdated Telecommunications Act of 1996. The F.C.C. is already considering a related issue as it seeks to settle a dispute between BellSouth and four states it serves - Florida, Kentucky, Louisiana and Georgia. Those states have told BellSouth that it must continue to sell broadband to an existing customer even if that customer leaves BellSouth to get local phone service from one of the few competitors that have survived the telecommunications shakeout. BellSouth is fighting the requirements, in part on the ground that one of its competitive advantages is that it enables consumers to buy phone and broadband in one place. 'Our marketing strategy is that we offer a complete package of our services,' said Joe Chandler, a spokesman for BellSouth. Because the company has made the investments in broadband network technology, he said, it should reap the rewards. 'If our competitors want to offer broadband,' he added, 'they should make the same investments.'

Subject: Re: Broadband and Phone Lines
From: johnny5
To: Emma
Date Posted: Sat, Mar 19, 2005 at 14:21:41 (EST)
Email Address: johnny5@yahoo.com

Message:
This kid only pays 60 a month??? Johnny5 pays 79 a month for verizon wireless broadband over his cellphone, but this kids has SPRINT for his cellphone - he can get internet over his sprint cellphone for 15 dollars I believe, but to get broadband speeds he would have to switch to verizon - still who needs broadband to check email or chat on pkarchive bbs? I havent had a landline phone for over 5 years now I think.

Subject: Oil Wealth in Indonesia
From: Emma
To: All
Date Posted: Sat, Mar 19, 2005 at 10:24:47 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/19/business/worldbusiness/19indo.html?pagewanted=all&position= Oil Wealth Wasting Away in Indonesia By KEITH BRADSHER BALONGAN, Indonesia - Roaring all day from the top of a chimney at a state-owned refinery here, a 30-foot-high roiling column of orange flames spewed vast clouds of black smoke visible for miles around. A 12-year-old compressor had broken down, refinery officials explained, and huge quantities of valuable propylene were being burned off for safety reasons. Indonesia's oil industry, like the refinery, has been burning money for years, squandering the nation's mineral wealth through underinvestment, bureaucracy, corruption and a wariness of multinational companies. So few new wells have been drilled in the last decade that annual production has dropped by more than a third. And the draining of existing fields has brought Indonesia, one of the oldest members of the Organization of the Petroleum Exporting Countries, to the ignominy of having to import oil in the last four months of 2004. As OPEC struggles with how to respond to oil prices rising above $56 a barrel, Indonesia's failure is more than just a tragedy for a poor developing country that has failed to take advantage of a potential windfall. As OPEC's only Asian member, Indonesia should be ideally positioned to meet soaring demand from China and the rest of Asia. Instead, its increasingly meager output has forced officials in Beijing and other Asian capitals to look farther afield, relying more on pariah states like Sudan and bringing more oil through the Strait of Malacca, where pirates have been preying on tankers and where governments worry increasingly about possible terrorist attacks. Now, Indonesian officials say they are determined to make their country an exporter again. They have raised prices and cut subsidies for gasoline and diesel to discourage waste. They have passed new laws and tax policies to encourage multinational companies to invest. And while populists are calling for Indonesia to withdraw from OPEC, in part to save nearly $2 million a year in membership fees, Purnomo Yusgiantoro, the country's oil minister and the holder of OPEC's rotating presidency in 2004, has been holding them off by setting up a committee to study the issue and promising a brighter future for Indonesia's oil industry. 'Indonesia is expecting to produce more oil in the future,' Mr. Purnomo said. 'Even if we become a net importer for one year, or less than one year, what does it mean?' A turnaround may not be so easy, though, and Indonesia's subsidies are especially ruinous. Because of them, Indonesians have been burning cheap fuel by the tankful, contributing to urban sprawl and traffic jams in Jakarta that rival those in Los Angeles. At the same time, factories rely heavily on diesel generators. The electricity from the generators would be more costly than electricity from coal-fired power plants if diesel fuel were not subsidized. The question is whether Indonesia is doing enough. While new laws and tax rules have been passed, regulations that would put them into effect have not been issued. More seriously, a 29 percent increase in retail gasoline and diesel prices on Feb. 28 still leaves both fuels selling for less than $1 a gallon. And the price increase assumed that oil would cost $35 a barrel in 2005. This means that the subsidies, which absorbed one-sixth of government spending in 2005, will cost even more. 'It's going to have a huge impact,' said Ramesh Subramaniam, the principal economist for Indonesia at the Asian Development Bank. Already, the 29 percent increase has provoked large street demonstrations and even fistfights on the floor of Parliament. The political debate in Indonesia now is over whether to roll back the increase or simply form a committee to study whether to roll it back. Further increases in fuel prices are no longer even under public discussion. Mr. Purnomo said in an interview that he hoped to reverse a slide in production, which fell to 950,000 barrels a day late in 2004 from 1.6 million barrels a day in 1991. Mr. Purnomo said that he expected production to rebound to at least one million barrels a day and stay there. OPEC rules require that members be exporters of crude oil, but do not specify what happens if a country temporarily becomes an importer. Mr. Purnomo said that he had an understanding with OPEC that Indonesia would be given a chance to resume exports, with no deadline set; OPEC officials declined to comment. The scale of Indonesia's troubles, in energy terms and in environmental terms, can best be seen in its oil fields and refineries. Here in Balongan, the huge refinery run by Pertamina, the state-owned oil company, towers over a small Javanese fishing village. Young men sit on the decks of dozens of 25-foot wooden boats in the mouth of a muddy river, mending fishing nets. Oil spills from the oceanfront refinery have severely depleted local stocks of fish. Warnipan, a 40-year-old with three grandchildren, said that a recent two-night trip with three other fishermen brought in only 73 pounds of fish, a third of their previous normal catches. After costs for food, fuel and the large chunk of their catch they owe the boat owner, the sailors found they had earned 50 cents each on the trip. 'Sometimes we can't catch any fish at all,' said Mr. Warnipan, who, like many Indonesians, uses only one name. The problem for Indonesia's oil production is that few people have the education and training to take jobs in Pertamina's nearby oil fields or refineries. So, while there is great demand in the oil industry, large numbers of unemployed young men loiter here and in neighboring communities of northern Java. As for women workers, despite the oil wealth under the ground here, this region has become best known as a source for desperately poor prostitutes for Jakarta's many brothels. Pertamina executives did not respond to more than a dozen phone calls and faxes requesting interviews. Pertamina's refinery managers said that there had been problems in the past but that they were planning to improve environmental safety, and they cautioned that overfishing and other factors might have also affected fish stocks. The managers also said that they hoped to build a concrete platform soon to prevent leakage from thousands of aging barrels holding toxic catalysts and other materials. The barrels currently sit in piles directly on the dirt, a practice avoided at refineries in industrialized countries. Pertamina has been slow to look for new oil fields on its own even as older fields run dry. Multinational companies are wary of investing, troubled less by the terrorism that produced the bombing in Bali and the recent attacks in Jakarta than by the political unrest that accompanied the Asian financial crisis in 1997 and 1998 and by recent contract disputes with the government in Jakarta. Indonesia 'has been relying pretty much on early 90's investment in oil and gas,' said Thomas L. Soulsby, a director of PT Energi Mega Persada, a publicly traded Indonesian oil company. 'Committees sitting in Houston, London or even Sydney decided to put their investment dollars elsewhere, and Indonesia really suffered.' This part of northern Java has only one of Indonesia's large oil fields. But while local residents have complaints about the operation, at least the field and refinery here have been developed. Exxon Mobil found a large oil field in eastern Java at Cepu more early in this decade, in an area where Pertamina and other companies had failed to find oil. Exxon Mobil geologists re-examined old data and then drilled deeper wells than anyone had tried before, finding oil in quantities that could increase Indonesia's annual output by a fifth. But production has yet to begin as the Indonesian government, seeking a greater share of the revenue, has tried to renegotiate the terms of Exxon Mobil's contract, which runs until 2010. The most important step Indonesia can take to attract investment is to have clear rules for contracts, said Maman Budiman, the vice president for planning, commercial and public affairs at Exxon Mobil Oil Indonesia. Developing oil fields in Indonesia is expensive, making energy companies leery of signing away too much of the revenue once production begins. The Cepu deposits are unusually deep, four miles underground, and industry officials say that other deposits in Indonesia may be similarly deep. 'When you combine tough production-sharing terms with government uncertainty, the big players are reluctant,' said Jeff Brown, an oil analyst at the International Energy Agency in Paris. 'Typically, they have to get better terms to produce in harsh environments.'

Subject: Warren Buffett and Optimism
From: Terri
To: All
Date Posted: Sat, Mar 19, 2005 at 09:50:16 (EST)
Email Address: Not Provided

Message:
As investors we can own Berkshire Hathaway shares. If the A shares are too expensive, there are the almost identical B shares. We can also attend to what Warren Buffett has to say about economics and investing, and companies Berkshire Hathaway buys, but we should never think we know what Buffett is doing. Berkshire is always building cash and there is a steady need to invest. The company has hundreds of billions of dollars in investments that seldom change. Buffett is always looking for reasonably priced assets, and may buy on any day. A problem for Berkshire is having to invest in such large amounts, there are fewer choices than possibly any other investor. Buffett believes the dollar will decline in value for a time, and holds international liquid assets, but 50% of liquid assets are in dollars. The letter to shareholders is thoroughly optimistic about our future. There are problems, there will comes resolutions. We would like the resolutions this day, but we can be patient.

Subject: Reasonably Priced Assets
From: Terri
To: Terri
Date Posted: Sat, Mar 19, 2005 at 10:23:14 (EST)
Email Address: Not Provided

Message:
The question to be answered is what assets are reasonably prices relative to expected income. I ask this question over and over. I do not worry about bargains, though there will be some now and then. I wish for reasonably priced assets.

Subject: Finding Assets
From: Terri
To: Terri
Date Posted: Sat, Mar 19, 2005 at 10:47:48 (EST)
Email Address: Not Provided

Message:
A year and more from now, we will look to this time and realize that there were assets with fine earnings streams and reasonable valuations. Not assets that are difficult to purchase but easily available assets. To be fine and secure investors will need to find such assets every once in a while. Not all the time, just every once in a while. We can do this.

Subject: Bond Fund Refuge
From: Terri
To: All
Date Posted: Sat, Mar 19, 2005 at 07:30:11 (EST)
Email Address: Not Provided

Message:
Investors who become bearish can forget again and again that besides looking for market sectors with reasonable values and stable earnings streams, there are always bond funds. Vanguard bond funds are always going to be a safe haven. There is superb quality and diversity in the investment grade funds. Bond fund price swings will depend on interest rate movements and duration. A duration of 5 years or less is simply not going to be a problem for any patient investor. Interest rates are rising and may rise for a while, but there is a limit. The limit will be when the Federal Reserve fears the economy will grow too slowly. When the economy does slow, interest rates will slow in rise and begin to fall. Why should any investor fear to hold a bond fund such as the Vanguard GNMA, with a 2.5 year duration and bonds insured by Congress? A radical interest rate increase of 4 percentage points would lower the fund price by no more than 10% while yields climbed. There is an investor's security when all else fails.

Subject: What is buffet buying?
From: johnny5
To: Terri
Date Posted: Sat, Mar 19, 2005 at 08:31:46 (EST)
Email Address: johnny5@yahoo.com

Message:
Why is he buying international currencies? Why isn't one of the greatest living investors of all time still buying us stocks and bonds? Why in 2002 did he radically change his investment strategy from something that had served him well for what - 40 years?

Subject: Value and Value
From: Terri
To: All
Date Posted: Sat, Mar 19, 2005 at 07:01:18 (EST)
Email Address: Not Provided

Message:
A question that is often asked is why should a person invest when there are many worries about market valuations and economic conditions. Well, market timing is so difficult that I have never found a market timer who has been successful. Why should I think I can time markets. What I might be able to do is find reasonable investment values, buy the values and stay and stay. Saving gives us a reserve to use to always be looking for value. The stock market as a whole and technology stocks in particular were very very expensive in 1999 and 2000, and the Federal Reserve was in a tightening cycle. There was no reason to buy what was so expensive, rather there were wonderful reasonable values to be bought. REITs were well valued, large drug companies were well valued, large oil companies and utilities were as attractive. Value stocks in general were much less expensive than growth, and mid cap and small value still less expensive. So, we can look and look for relative and absolute value.

Subject: Buffet is not a market timer?
From: johnny5
To: Terri
Date Posted: Sat, Mar 19, 2005 at 08:27:58 (EST)
Email Address: johnny5@yahoo.com

Message:
Buffet says there isn't ANYTHING to buy - why do you disagree with him? Why is he wrong? He is one of the best investors ever no? He said he can't find ANY VALUE, he is out the dollar.

Subject: Strategic Failure to Deliver
From: johnny5
To: All
Date Posted: Sat, Mar 19, 2005 at 05:56:25 (EST)
Email Address: johnny5@yahoo.com

Message:
Remember I posted earlier that a 1932 congressman said the crash and liquidity tightening of that age was ENGINEERED to screw the little guy - well here you go: http://www.siliconinvestor.com/readmsg.aspx?msgid=21134943 CEO Overstock.com on Naked Shorting: When I ask, “By appeal to what law or regulation are you refusing to disclose this to me?” they clam up. This is one of the warnings telling me that this may be a problem of catastrophic proportions. Dr. Patrick Byrne (CEO, Overstock.com) on Naked Shorting: Patrick M. Byrne (Ph.D., Stanford) CEO, Overstock.com http://ncans.net/byrneshort.htm Dr. Patrick Byrne's Summary Of The Naked Shorting Problem From the Overstock Message Board - 3/13/05 Dear Colleagues, The issue of “naked shorting” seems to be becoming a news item, and is even (perhaps) a scandal in the making: I have been called by several publications in the last week to discuss the issue, and there is word of a major exposé on a network news program to run soon. This is especially topical, given the issue of Social Security private accounts. As is known by those who have been regular readers of this board, my involvement with the issue is that of a concerned citizen. However, I figured I would write something here so those who are interested can follow along. Some of this draws together points I have tried to make in earlier threads about “Wall Street Criminals,” but most of this is new. I have tried to explain here the Failure-to-Deliver and Naked Short issue in plain English. You auction sellers in particular will find many parallels between this issue and the issue of auction fraud, albeit it on a grander scale. In any case, I hope that those who are interested may find this a concise and useful précis on the issue. 1. Shorting Stock: This is a legal and honorable method of investing. Suppose a share of IBM stock is trading at $90, but I expect IBM to go down. I “short” it. This means that, through my broker, I borrow a share of IBM, sell it in the open market, and collect $90. Assume that IBM then drops from $90 to $50. That is as low as I think it is going to go, so I “cover” my short: I take $50 of the $90 that I collected, I buy a share out in the market, and return it (through my broker) to the person who loaned me a share in the first place. I am left with $40 profit. 2. Failure-to-Deliver (“FTD”): The American stock market runs on a “T 3” system. This means that when you sell a share of stock, you have 3 days to deliver that share. If you do not deliver within 3 days, you have, “failed to deliver,” or “FTD’ed”. Think of this like someone who posts auctions but does not deliver the goods. 3. DTCC: Depository Trust & Clearing Corporation. This is the back-office of Wall Street. Rather than have people run around with paper stock certificates, the DTCC keeps electronic records of who owns which stock at which brokerages, and settles the trading of stocks. If you “FTD” (“Fail to Deliver”), the DTCC are the folks whose books don’t match. 4. Strategic Failures to Deliver: Not all FTD’s are necessarily illegal. Someone may forget to get shares of stock out of her sock draw and deliver them to her broker within three days of a sale, yet this does not make her a criminal. Also, in the center of Wall Street there exists a job known as a “market maker,” someone who is charged with maintaining an orderly market in a stock by continuously buying and selling to create liquidity. Market makers are allowed (on a good faith basis) to buy and sell stock that does not exist, temporarily, just to keep liquidity in a stock. Again, this is expected and allowed. What is not allowed, however, is for investors to sell and fail-to-deliver purposefully: doing so (through a variety of mechanisms that I will explain below) in an attempt to manipulate the price of a stock, is a “strategic” failure-to-deliver. Some folks believe that Strategic FTD’s played a role in the 1929 meltdown. In any case, there have been regulations against it since 1933 (regulations which provide for criminal and civil penalties). The slang term for “Strategic Failure to Deliver” is, “naked shorting.” 5. The Economics of Naked Shorting: The gist of naked shorting is simply, when a hedge fund pretends to short a stock (I say, “pretends” because it is stock that it does not really own, and which it does not really borrow). It sells those made-up shares into the marketplace, and collects the money just as though it sold real shares (note that this is “counterfeiting,” more or less, though with electrons rather than paper). If it is stock in a small company, and does not trade with much liquidity, then the hedge fund can keep “selling” its made-up shares and drive the stock price down to wherever it wants it to go. In a healthy market, the check-and-balance on shorting would simply be the number of shares that are available for short sellers to borrow and sell. Since there would only be a finite number of shares to borrow and sell, there would be only a finite amount of pressure the shorts could bring upon a stock (and it would be offset by buying pressure holding that stock up). But if naked shorting is allowed, then there is no limit on how many bogus shares hedge funds can create. Thus means they can drive a stock’s price down close to $0. At the very least, this practice destroys peoples’ savings (remember, the shorts make money by driving the stock down, whereas any stockholders lose that same amount of money as the stock price drops). Some folks believe companies have been driven out of business by this, because they cannot raise new capital once those stocks have cratered badly enough. The key is this: if given the right to create an unlimited number of new shares, essentially out of thin air, not limited by the number of shares “in the borrow” as legal shorting requires, these hedge funds can always drive the price down and always cover for a profit. That is why it’s, “illegal.” 6. How can Naked Shorting Occur in Our Regulated Markets? _____a. The lazy explanation: How can a hedge fund get away with selling shares it neither owns nor borrows? One theory is that the DTCC (and some brokers) look the other way for “favored” clients. “Sell 100,000 shares of XYZ for me.” “Do you have the shares?” “Oh, you know I’m good for it!” Large clients enjoy such favored relationships and, because they have deep pockets, the DTCC and the brokers assume they can trust those clients to operate like this and true things up later. This lackadaisical attitude, however, gives dishonest hedge funds opportunity to “sell” stock that does not exist, and thus create downward pricing pressure that becomes self-fulfilling: as the stock gets driven down it reaches the point that other owners lose confidence and dump their stock, and as it gains downward momentum, the naked shorts can cover their shorts and move on. _____b. The sleazy explanation: Believe it or not, there is a more insidious explanation of how this game works. Imagine that a sleazy hedge fund chooses a small, illiquid company to attack. Often that company is in a poorly understood sector, or is a company with some accounting complexities so it will be possible to create “where there’s smoke there’s fire” skepticism about its books. Here is what happens: __________i. The hedge fund gets that US firm listed on foreign exchanges. __________ii. That hedge fund then “sells” shares it neither has nor borrows. __________iii. When the DTCC calls after three days and says, “Where are those shares?” The hedge fund replies, “I borrowed them on the German exchange, they will take a few weeks to show up,” or “I am a market maker for the German Exchanges in that stock, and thus excluded from the no naked shorting rules.” __________iv. With a nudge and a wink the DTCC says, “OK, we’ll loan you from our own reserves of that stock.” The DTCC collects a high fee from the hedge fund to do this. __________v. The hedge fund has relationships with a few compliant reporters, who are called and told, “Do a hatchet job on Company XYZ.” They do so, perhaps in return for off-shore compensation. __________vi. The combination of bad publicity coupled with the selling of an unlimited number of shares drives the stock down to the point either that the hedge fund covers and moves on, making a quick $20 - $50 million, or the company goes bankrupt, or simply remains a penny stock (in which case the hedge fund never has to cover its short, and hence, never pays taxes!) 7. The Regulatory Environment: After years of pressure, in 2004 the SEC promulgated Reg SHO (for “SHORT”), which directs the exchanges (NYSE, NASDAQ, etc.), to start publishing early in 2005 lists of companies whose FTD’s exceed a reasonable amount (“reasonable” = “greater than .5% of the shares in the company”). This list is called, “The Reg SHO Threshold List.” It does not list the amounts of FTD’s, just the names of companies that are experiencing them. The way Reg SHO is supposed to work is as follows. If a company crosses beyond the threshold of a reasonable amount of FTD’s, and then stays there for 5 days without crossing back under the threshold, its name goes on the Reg SHO list. Then, after 13 more days, if it is still on the list, brokers are supposed to tell those hedge funds that are failing to deliver that they must stop failing to deliver, and those brokers are not supposed to take any more short sale orders from those accounts for those stocks. 8. Reg SHO is flimsy: So flimsy, in fact, it set folks scratching their heads - does the SEC not get it? Here is why it is flimsy: _____a. Telling the hedge funds after 13 days, “You are not supposed to do any more naked shorting in this stock,” is meaningless - they weren’t supposed to be naked shorting it in the first place. _____b. There are no sanctions for violators. _____c. Why grandfather violations that have been illegal for 71 years? 9. Two theories regarding how big a problem this is: _____a. Tame theory: This is a problem for a small percent of companies, just those that find themselves on the Reg SHO list. Thus this is not a hard problem to fix. But fixing it is going to cause a lot of hedge funds to lose money. They are well-connected with the SEC, and the SEC is co-opted to the point that they are tightening down on this half-heartedly. _____b. Extreme Theory: This problem is so endemic that if the SEC tried to fix it the system would crack. There are so many losses waiting to be realized by the hedge funds, it would be like the failure of Long Term Capital Management, but on a massive scale (see Roger Lowenstein’s, When Genius Failed, for an excellent explanation of the risk that the failure of even one large hedge fund put on our financial system). In this scenario, the reason the SEC is not being suitably aggressive is because they know the problem has gotten beyond what can be solved without a systemic failure. 10. Which theory is correct? I don’t know. No one knows outside the DTCC, SEC, and maybe the NASDAQ and NYSE. And they are not telling. I have asked the DTCC, SEC, and NASDAQ for the size of Overstock’s FTD, but they all refused to disclose it. This amazes me: if I sold 100 shares out the back door of Overstock without registering them I would go to jail, but (per our inclusion on the SHO Threshold list) some hedge funds have sold hundreds of thousands (or millions) of phantom shares, and the SEC and DTCC protect them. When I ask, “By appeal to what law or regulation are you refusing to disclose this to me?” they clam up. This is one of the warnings telling me that this may be a problem of catastrophic proportions. I hesitate to describe the others, as it sounds like I might be lining my hat with tinfoil. But in the interest of completeness, I shall. In 2004 it became public that one well-known short seller, David Rocker (of Rocker Partners), was shorting our company. In October, 2004 I invited him on a conference call to debate me, and it got pretty nasty (see this transcript for details: Click here for the transcript Immediately thereafter some knowledgeable-sounding people got in touch and warned me of four things to come, in this order: _____a) Reporters A, B, C, and D would call and do hatchet jobs on me, as they were lackeys to Rocker; _____b) I would find Overstock.com listed on innumerable foreign exchange; _____c) We would find ourselves on the Reg SHO Threshold list when it came out in January. _____d) The SEC would announce they were starting some inquiry on us. I already knew Reporters A, B, and C, who had gone far out of their way to write uncharitable articles about me, and while I always wondered at their eagerness to do so, I gave the prediction of more such articles little credit. Yet I had never heard of Predicted Reporter D (Elizabeth MacDonald of Forbes): within two days, she (along with A, B, and C) had called with clear intent to write something unpleasant. Elizabeth hunted for a week, then gave up: we are so squeaky clean, the most such reporters can do is write anodyne trivia: e.g., Herb Greenberg actually once devoted a whole column to how quickly or slowly I returned his calls, and how this could be interpreted as a sign of sinister intent (as opposed to, say, whether or not I was getting on and off planes as I synched my emails). Then over the autumn of 2004 we found ourselves listed on five exchanges in Germany and one in Australia: someone went to all the trouble to get us listed on these exchanges, though hardly any shares have traded since (this confirms the theory that these foreign exchanges are used simply as smoke screens by hedge funds needing an excuse for the DTCC). On January 27 we appeared on the Reg SHO Threshold list (only about .4% of companies are on this list). Thus, these “crazies” had made four pretty far out predictions. The first three of them have come true. The test of any theory is its ability to make accurate predictions, and the “crazies” have passed that test. So I started paying a lot more attention to what they had to say. Incidentally, their fourth prediction (the SEC trying to make trouble for me) has not come true. However, an increasing number of smart people are telling me that, now that I am taking a lead role in this issue, and am the first non-fringe player to do so, the SEC is going to crucify me, for they (according to these sources) are thin-skinned, vindictive, unused to criticism from those whom they regulate, and partly captured by the very hedge funds that benefit from these practices. 11. The “Pay-No-Attention-To-The-Man-Behind-The-Curtain” Responses: A party line has developed within Wall Street that runs like this: _____a. “There is no naked shorting”: This used to be the party line, but since 300 companies appeared on Reg SHO since January 2005 it has worn thin. _____b. “Reg SHO will address this problem”: As only a handful of those 300 firms have dropped from the Threshold List, this is dubious, too. _____c. “CEO’s who make an issue of this are just mad that their stock is down.” I have nothing about which to be mad: our stock is 2-3X where it was in early 2004. I am trying to bring attention to this because there is a risk to the public. _____d. “The folks who make a big deal about this are crazies who line their hat with tinfoil.” Could be. I know they sound whacko. I know I sound whacko, too. But the test of a theory is its ability to predict, and these “crazies” make accurate predictions. I have been called by precisely those journalists they predicted would call me. OSTK has appeared on 6 foreign exchanges, none at our own request. On January 27 we appeared on the Reg SHO list (and as we have not come off it since then, I feel the “crazies” are right about the flimsiness of the Reg SHO mechanism, too). The only thing these “crazies” have missed so far is that the SEC has not started any vendetta against me (yet) for bringing attention to this issue. I hope this gives you, dear reader, a broad enough overview of this problem that it may suggest further inquiry. I repeat, I do not know how deep a problem this is. It could be next to nothing, or it could be an Enron waiting to happen (with far greater ramifications, as the failure could be systemic). I don’t know, but I do know that it would be easy for the SEC to clear up the mystery: all they have to do is publish the size of the FTD’s for the companies on the Reg SHO Threshold List. This is, I think, a fair question for me to ask: after all, if without registering them I sold 100 shares of Overstock out the back door of the firm I would go to jail. Yet per our inclusion on the Reg SHO Threshold list we know that some hedge funds have done that with hundreds of thousands (or millions) of shares: why won't the SEC reveal who, and how many counterfeit shares they 'issued'? The fact that the SEC, the DTCC, and the exchanges refuse to disclose this (though they must have the information every night, else how could the calculate whether or not a company belonged on Reg SHO list?) makes me worried that it might be a bigger problem than they want anyone to know. On the other hand, if there is really nothing to this issue, then the problem can be cleared up overnight, and myself (and all the other “crazies”) would go away. All we need are the answers to five simple questions, which I write out below in the hopes that some concerned citizens, or an enterprising journalist, can use them to dig a little deeper on her own. 12. Five Questions for the SEC _____a. Does SEC receive daily data from the DTCC/NSCC on Fail to Delivers? __________i. If not, why not? __________ii. How can the SEC regulate without this? _____b. How large is the fail to deliver problem? Does the SEC even know? __________i. Why won’t the DTCC tell anyone how large the problem is? __________ii. Why won’t the DTCC tell the SHO companies how large their FTD problem is? _____c. How can firms remain on the threshold list if Reg SHO is enforced? _____d. Why grandfather - pardon - all violations prior to January 7, 2005? __________i. Wasn’t it against the rules (10(a)2, 15(c)6-1, 17(a)) since 1934? __________ii. Why won’t the SEC enforce rules on the books for 71 years? __________iii. What logic supports pardoning flagrant, regular violation of rules? _____e. Who are the biggest violators of the Failure to Deliver rules? __________i. Who benefits the most from the past fails being pardoned? __________ii. Why reward these hedge funds for systematically violating the rules? _____f. How can private SS accounts be considered while this is going on? I thank any reader who has stuck with me through this long explanation. I made it as clear and concise as I could, and hope that through these modest efforts some enterprising reader or journalist will have gained the ammunition needed to breech the defenses of Wall Street and get some answers. And if for my efforts you see me doing the perp walk on TV, remember to send me a cake with a file in it! Respectfully submitted, Patrick M. Byrne (Ph.D., Stanford) CEO, Overstock.com PS My disclaimers: - While David Rocker has been public about being short us (and a surprising percentage of other companies on the Reg SHO Threshold List!), I do not mean to claim that he is naked short Overstock. Someone is, but it is not necessarily him. He could simply be short us, and it be some other party who is naked short our stock. - The Tools of Satan are going to try to claim that this is all some scheme of mine to get people to buy our stock. It is not true. None, and I mean none, of this is intended to get anyone to think about buying Overstock stock. I am doing this because I am convinced enough of the issue to want the public to get some answers. Someone has to do this, and John Wayne is dead. But do not confuse my involvement with this issue with any valuation or other issue regarding Overstock.com. Hey, I get involved in other political issues to (e.g., education reform), and they are not all driven by some secret aspirations to get customers or shareholders. (The end)

Subject: Naked Shorts on Nasdaq - Golden Rule
From: johnny5
To: All
Date Posted: Sat, Mar 19, 2005 at 05:25:07 (EST)
Email Address: johnny5@yahoo.com

Message:
Them who owns the gold, makes the rules: http://www.nasdaqtrader.com/aspx/regsho.aspx Regulation SHO for those of you who do not understand the significance. http://www.siliconinvestor.com/readmsg.aspx?msgid=21143810&srchtxt=SHO There are Laws governing the issuance of common stock. Those laws are rigorus and at the heart of all value. Any scheme to introduce any methodology into the system; which breaches the promise and practice of share issuance laws is itself an illegal act. BRKA is the best example of unadulturated S&D metrics.... Someones broken into the system by introducing methodologies into our markets these methodologies are illegal, the very existance of the SHO list is an admission of this. Focus on all the value arbitrarily created or assigned by illegal transactions; and you see why all attempts to legitimize these schemes must be held to account. No one is standing up though. Amazing isn't it? The government throws Martha, the last woman in America willing to cook and keep house, into the slammer for telling a fib on a $60K transaction, while billions are trading hands in illegal naked shorting activity. Yet no one will blow the whistle and start handing out supeona's. Heck they can't even decide on a date they are going to start enforcing the damn reg. http://www.siliconinvestor.com/readmsg.aspx?msgid=21146912&srchtxt=SHO "On March 4 and 7, I purchased a total of 180,000 shares, resulting in my obtaining 15.54% ownership of a stock reportedly already 100% owned by another investor. I assume that there may be additional investors who may also claim ownership of common shares of this company. "I have requested that certificates be issued to me representing my full 15.54% ownership interest, to protect my right to vote and enforce any other claims that may accrue to an actual documented owner. "I understand that Reg. SHO was supposed to detect and prevent the fabrication of millions of nonexistent shares. It would appear that my securities purchases prove that Reg. SHO has been systematically violated by market-making brokers and securities-clearing firms. "From time to time I may continue to purchase additional securities on the open market to increase my ownership interest to up to 100% of the company's common stock to give me an ownership interest equal to that of the current 100% owner," Floto concluded in his SEC filing. Simpson told FinancialWire that Oppenheimer has told him, after it sold him the shares, that it can not find shares to deliver to him. He said he has been discussing this with his attorney and plans soon to take action. Simpson is also considering court action in Nevada, the domicile of Global Links, to prevent the issuance by the company, whose executives he does not know nor seems to be interested in knowing, of any additional shares. He may also seek to become a director. Simpson is concerned that there may be a form of preferred shares that could prevent him from taking control of the company, so is exploring all his options. Simpson also said he received a call from a national reporter with the Dow Jones (NYSE: DJ) News Service, who he said accused him of "insider trading," and trying to flip his shares, and said she did not seem to know that his filing of the 13D prevents him from selling the shares for a year. That is not the least of his worries, however. A poster on Raging Bull with the monicker igroup), in post 27429 under the Zann Corp.'s message board, stated, "I would'nt be surprised if someone put bullet in the back of his head .." The message has been turned over to the Federal Bureau of Investigation. So brokers make money trading stock - real or fake stock - they still make money - well now people are threatening to bring honesty back to the market and getting death threats - terri does not want to hear this Pete - this is real world stuff with bullets and gangsters - don't stress them. Let the rich have all the gold and be happy for the crumbs they allow you to have.

Subject: Vanguard Returns
From: Terri
To: All
Date Posted: Fri, Mar 18, 2005 at 21:27:37 (EST)
Email Address: Not Provided

Message:
http://flagship5.vanguard.com/VGApp/hnw/FundsByName Vanguard Returns 12/31/04 to 3/18/05 S&P Index is -1.5 Large Cap Growth Index is -3.2 Large Cap Value Index is 0.6 Mid Cap Index is 0.1 Small Cap Index is -2.6 Small Cap Value Index is -2.1 Europe Index is 2.4 Pacific Index is 1.7 Energy is 17.3 Health Care is -0.1 REIT Index is -5.8 High Yield Corporate Bond Fund is -0.1 Long Term Corporate Bond Fund is 0.5

Subject: Sector Indexes
From: Terri
To: Terri
Date Posted: Fri, Mar 18, 2005 at 21:28:31 (EST)
Email Address: Not Provided

Message:
http://flagship2.vanguard.com/VGApp/hnw/FundsVIPERByName Sector Indexes 12/31/04 - 318/05 Energy 20.2 Financials -4.8 Health Care -1.7 Info Tech -7.9 Materials 4.3 REITs -5.8 Telecoms -6.6 Utilities 4.9

Subject: DFA beating Vanguard
From: johnny5
To: Terri
Date Posted: Sat, Mar 19, 2005 at 01:15:59 (EST)
Email Address: johnny5@yahoo.com

Message:
Terri if you look here http://www.dfaus.com/strategies/non_us/ for thier international and here for their domestic http://www.dfaus.com/strategies/us/ They are beating vanguard in a lot of funds - do you know much about DFA? For what reason would they be beating Vangaurd? Luck?

Subject: Understanding Price Earning Ratios
From: Terri
To: All
Date Posted: Fri, Mar 18, 2005 at 20:30:17 (EST)
Email Address: Not Provided

Message:
The S&P price earning ratio was 18.6 at the beginning of this month. What puzzles me is why the p/e ratio is still this high since we passed through a fierce bear market and have not yet recovered, also earning have been excellent. I do not think stocks are priced too highly, for the p/e ratio since 1970 is about 15, and 18.6 reflects a more liquid and even safer market. Also, interest rates are low so bonds are little competition. Still, I do not know why the p/e is still so high.

Subject: Re: Understanding Price Earning Ratios
From: Pete Weis
To: Terri
Date Posted: Sat, Mar 19, 2005 at 04:20:46 (EST)
Email Address: Not Provided

Message:
Obviously earnings have not been that excellent. Lots of spin on Wall Street and in the business press about great earnings. But while some companies have enjoyed great earnings (especially oil companies) overall earnings have been poor. Just shows you how you have to look below the surface to see through the bull that's being slung around these days. Another thing - many of those earnings being reported by many companies are phony. I'm betting the real p/e of the S&P is somewhere well north of 20. That series on Infospace and the dotcom industry in general in the Seattle Times gives a lot of detail about how these companies 'cook the books'. Believe me this business of fake earnings is fairly rampant throughout the world of publicly traded companies. Many corporate executives are more concerned about protecting the value of their stock than they are with the long term welfare of the companies they manage or the stockholders. They want to keep the stock price up at all costs until they can sell and cash in their gains. It's quite a system - IMO, a confidence game really. Here is how it works. A small investor goes to major brokerage firm seeking investment guidance. He or she is assigned a broker who is really just a sales person or front man/woman. The broker interfacing with the potential client gains the confidence of the small investor and makes them feel they can trust the broker and the firm he/she represents. Information about the prospective client is sent up the line to a group of 'investment analysts' who put together a 'balanced portfolio' of stocks, bonds, funds and investments for the prospective client. However, the main focus for these analysts is not what would constitute the best investment choices for the prospective client but rather to funnel the clients money into companies which compensate the brokerage and associated investment bank for underwriting services and investment banking services. This is where the real money comes from for major brokerage firms who have investment banking arms. Before signing an agreement, the prospective client is sent a booklet suggesting a portfolio which would be suitable for the client's investment goals. By law the brokerage firm must reveal its relationship to the companies it lists in the portfolio - usually with tiny footnotes and fine print. If the prospective client where to closely examine these footnotes they would discover what was going on. But few small investors pay much attention to this. The executives at the companies doing investment banking business with the brokerage reward the brokerage firm with continued lucrative business for, among other things, funneling small investor retirement savings into their companies. The top executives at these companies award themselves huge stock options while the board of directors pay-a-no-never-mind because many of them are their to just collect a nice check (like former senator Phil Gramm's wife on the board of directors at ENRON). Phil Gramm (long time banking committee chair while a senator) is now pulling down a hefty check as vice chairman of giant financial corporation UBS. UBS was part of the effort to hide ENRON's debt and earnings troubles and defrauding of investors. Gramm and his fellow UBS management team followed up the ENRON rip-off of investors with the HealthSouth investor fraud and the latest for UBS is their participation and assistance in hiding debt accumulated by the European food corporation Paarlamat(sp?). Morgan Stanley, Merrill Lynch, Smith Barney, JP Morgan, Goldman Sachs and Bear Stearns, to name a few, are all defending themselves against suits and SEC actions involving conflicts of interest and defrauding investors. But government regulators, when they do go after these offenders, only force them to pay fines which amount to 'pocket change' for companies which do billions in business. So they keep on running these schemes of skimming small investor savings to enrich the few who take part in this scam. There are certainly Democratic politicians who are also assisting and benefiting from these companies which are basically stealing from folks who have worked hard to have something in retirement. Even though I invest in the markets, I realize that they have become largely a vehicle to skim wealth from the masses to the few. At some point this whole corrupt system will fall apart and many very angry and disallusioned folks are going to want to know why and who did this to them.

Subject: Well Done
From: Terri
To: Pete Weis
Date Posted: Sat, Mar 19, 2005 at 06:12:08 (EST)
Email Address: Not Provided

Message:
This is a wonderful essay, carefully considered response at every point. I will in turn consider each point and respond. When you find an important series of articles always please tell us, for I would surely not have known about many articles you have posted and mentioned otherwise. Remember that bond funds can always be a secure investment alternative.

Subject: French on Behavioral Finance
From: johnny5
To: Pete Weis
Date Posted: Sat, Mar 19, 2005 at 05:08:00 (EST)
Email Address: johnny5@yahoo.com

Message:
Watch this video by Ken French on behavioral finance and small cap value investing: http://library.dfaus.com/videos/thinkers_french/ I read recently on diehards I think that a lot of the great value investors (buffet, graham) only look at earnings if they are sustainable, labor layoffs, one time productivity gifts in offshore IT and one time sales of assets are fooling uneducated investors because the earnings those things generated are not sustainable. Pete, warren said to get off the titanic, certain people think he is wrong and continue to put all thier wealth into investments he is betting against. In comparison that is like betting against andre agassi or pete sampras on some no name. That is like betting against shaq or kobe on some no name. Or like betting against jeff gordon in his nascar racer losing to your mother in her minivan. They defy logic - the man at the TOP of this investment game says GET OUT - one of the most skilled investors ever - and they keep wanting to bet on grandma millie and her mini van - not jeff gordon. So let them have their grandma millie - you stress them giving them all this negative info and they don't want stress - some people like being poor and stress free Pete - my grandfather did - and you trying to educate them about money and investing does not really help them even though you think it does - to you more money for stress may be worth it - but too many they want someone else to take care of them and make thier life stress free even if they are not as rich because of it. My grandfather lost his 40 acre farm because he liked stress free blissful ignorance, no big deal to him, he went and picked oranges all over the country for the next 20 years happy go lucky as he could be. He was truly a happy man, losing his farm did not bother him in the least. But then I read here about the property boom in 1890 california: http://www.siliconinvestor.com/readmsg.aspx?msgid=21138173 An article in the 'Los Angeles Times' dated June 9, 1887 told of a Pasadena citizen who took strychnine because 'he had sold some property too cheap,' and subsequent inflation of values had made him regret his disposal of it. So you have 2 kinds of people, my grandad and terri that can or will lose everything and not be bothered by it in the least, and then people like this guy who because he didn't make top gains committed suicide like hunter s thompson. Wether terri loses all her money or not - what good does it do her for me and you to stress her or anyone else? If someone sees the skill of jeff gordon and chooses to bet on grandma millie against him - let them have thier beliefs Pete - you and I know Gordon is certain to win - and if we can make the losers feel better by not stressing them then we all benefit - they don't mind the losses and you and I don't mind winning the 40 acre farm and everybody is happy. The markets can remain irrational longer than you can remain solvent, and if you keep preaching doom and short while they go long - all that happens in the end is you go broke and are upset for losing money, they go broke and are upset you kept glooming and dooming them - and everyone is upset then and loses. Instead follow the momentum as French recommends - don't rock the boat (titanic) be saavy - make people feel good for what they are doing - make your money and be happy, and let them feel good and stress free even if they lose their money and instead of everyone being upset - we will all be happy and less stressed.

Subject: Give credit to Terri for....
From: Pete Weis
To: johnny5
Date Posted: Sat, Mar 19, 2005 at 12:54:32 (EST)
Email Address: Not Provided

Message:
managing her own investments. I don't know about Terri, but if I make bad investment decisions and lose money, I can deal with it. But if I give it up to someone else and they scam me or make poor decisions on my behalf then it bothers me to no end and I feel like I'm a much bigger idiot. What disgusts me is all this talk about moral values and 'family values' and behind the scenes many of the very same people who mouth these platitudes, are leaching the retirement savings of millions of middle-class Americans via a corrupt system. So in the end, the bigger issue is not whether Terri, Johnny or Pete make the right investment decisions - it's about the selling out of America. But maybe I should just smarten up and realize that this has always been the America in which I have lived - I've only just become fully aware of it in the last several years. Or is it that we really have reached new levels of corruption both in the worlds of politics and business in recent times. I prefer to believe the latter since it means that sometime down the road, maybe after 'The Great Unraveling' has fully played out, we have a chance to clean this mess up.

Subject: Re: Give credit to Terri for....
From: johnny5
To: Pete Weis
Date Posted: Sat, Mar 19, 2005 at 21:03:47 (EST)
Email Address: johnny5@yahoo.com

Message:
I give great credit to Terri for money management and asset allocation, I am positive she knows the finer details at levels I have not reached nor may ever, but I worry that with the smart money like buffet and gates and others getting out of the dollar and buying foreign currencies if there is any domestic strategy that will be successful over the next 5-10 years. While you are in bearx and oil, and I am in oil and international value, she is in GNMA - we have different investing philosophy - I know for certain I will never be what warren is, so it seems logical to me to do anything opposite of what this great investor suggest is destined to failure. He says there are no values in domestics anymore. Terri steadfastly and optimistically thinks we can find value - but he says we cannot - and it is hard for me to understand how these 2 very bright individuals have such differing view on wether we should be short the dollar and time the market and get out of us currency or be in domestic bonds and equities. I can't take the risk Pete to be wiped out in a 1929, or march 2000 type event - even if I have to forego equity premiums for that safety I am beginning to believe strongly that it is ok and better safe than sorry. I am like you, the more devil in the details I discover about our brokerage system and financial systems the more amazed I am such things function with so few really understanding the 'conundrums' I only want for all of us to make secure retirements, but if you and I and terri and emma and david e and all the rest have very different asset allocations - it would be wise to get understanding why we all arrive at very different investment choices and outcomes from the same information? Why do you choose bearx? Why do I choose Xom? Why does terri choose gnma? I think at a fundamental level terri has more trust in large government entities than I do and I want to understand why that is so after greenspan admitting he was confused and wrong and having to cut our collective benefits because of his error.

Subject: Re: Give credit to Pete for....
From: Terri
To: Pete Weis
Date Posted: Sat, Mar 19, 2005 at 14:03:19 (EST)
Email Address: Not Provided

Message:
Agreed, Pete. These posts of yours are wonderfully well written. Intelligent investing is possible despite structural problems. The need is to keep learning how to be intelligent :)

Subject: Kindleberger says one word 'Mania'
From: johnny5
To: Terri
Date Posted: Sat, Mar 19, 2005 at 01:02:03 (EST)
Email Address: johnny5@yahoo.com

Message:
Now is not a good time to buy, Buffet is short the dollar and mostly out of the markets - why aren't you Terri?

Subject: Hope All is Fine
From: Jennifer
To: johnny5
Date Posted: Sat, Mar 19, 2005 at 09:19:27 (EST)
Email Address: Not Provided

Message:
I trust all has gone happily for your uncle.

Subject: Re: Hope All is Fine
From: johnny5
To: Jennifer
Date Posted: Sat, Mar 19, 2005 at 20:48:10 (EST)
Email Address: johnny5@yahoo.com

Message:
So far the broker assures him his money will be refunded and we wait - the broker was seeing a client and said these specific words to him 'I hope there are no hard feelings, when you get your head on straight and passed all this crazy thinking you are doing, we can get you into some good investments' I am disheartened Jennifer - I really don't think this person realizes that they were putting my uncle into a very bad investment - they don't understand that costs matter and spread disinformation that they believe in - I really appreciate y'alls advice and help. The broker claims in 15 years of business this was the first time ANYONE ever made use of ths sunshine law of 10 days to cancel the annuity and that is why they did not know it was only 10 days. If this is TRUE Jennifer - I feel so sorry for so many people. I convinced my mother to do a 1031 exchange on her property in west palm, we went and put a refundable 1,000 deposit on one of these 'master planned' community lots in pasco county, fl. Now this freaked me out, we had to stand in line for about 5 hours to get into the model homes office, then there was some kind of raffle for assigning lots, then they released lots in this phase of the development - phase 2 that was only supposed to be releases in phase 3,4, and 5. There was that much demand, they gave her a lot and because it was slightly bigger than standard - it would have a 5,000 dollar premium - we said OK (that lot was just a few hundred yards from a publix where most of my uncles have worked thier whole life) mom wrote the check for 1,000 and the next day they called us and said OOPS we made a mistake - that 5K premium is really gonna cost you 15K!!!!!!! I flipped Jennifer - I told my mom monday we need to go get a lawyer - that is a bunch of BS - the realtor said well it was a madhouse and we misquoted you the price and don't feel bad, if you hadn't got in that day, you would be paying 5K more for the lots already, so instead of a 15K premium, they are now a 20K premium - the realtor said be HAPPY you have already made 5K - this totally makes my brain hurt Jennifer - total madness. I think they saw they could jack the prices 10K and stick it to these people. Now Johnny5 was exploring and while the realtors were all fighting the crowds he was going through the drawers in the kitchen of one of the model homes to check out the rollers and surprise johnny5 found a price list from november 2004 - prices on a standard lot with a 1500SQ ft house were 170K, by march 08, their new price list had that setup for 210K but that was before the 10K new additional premium - so 170K in november, 220K in march for the exact same thing - these developers are making out like a bandit. Isn't the government supposed to protect citizens from overpaying for stuff in this country? What is funny is and older development right next door with houses that are about 5 years old but identical in look and architecture and just about everything else johnny could check only cost 150K used - there were a few for sale in that price range - so how does a brand new house cost 220K and a house 5 years old but almost identical in lot and house cost 150K?

Subject: Japan and Bubbles Bursting
From: Terri
To: All
Date Posted: Fri, Mar 18, 2005 at 18:33:37 (EST)
Email Address: Not Provided

Message:
When the Japanese stock market began the tumble in January 1989 from 38,900 to 24,000, the central bank comments were about the bubble economy that had burst as though this was a hopeful bursting. Japanese stocks were evidently not much owned in households, rather companies held stock in each other, so why should there be a problem? When real estate prices began to fall in 1992, households were effected but still the central bank seemed to welcome the bursting of the bubble. Well, it is 2005 and Japan has not recovered. I would hope the Federal Reserve is awfully wary of simply letting bubbles burst.

Subject: Limiting a Negative Wealth Effect
From: Terri
To: Terri
Date Posted: Fri, Mar 18, 2005 at 21:54:57 (EST)
Email Address: Not Provided

Message:
That we have a Federal Reserve which is always concerned about a negative wealth effect is of considerable comfort. We will not allow a negative wealth effect such as occured in Japan, for we will move much earlier and in pronounced fashion as the Fed did from January 2001.

Subject: The Wealth Effect
From: Terri
To: All
Date Posted: Fri, Mar 18, 2005 at 18:21:05 (EST)
Email Address: Not Provided

Message:
I read through the minutes of the November 15, 1994 Federal Reserve meeting when it was decided to raise rates by 75 basis points. Much to my surprise Alan Greespan strongly warned that the market had built in a 50 basis point increase and would build in another if the Fed went along. So 75 basis points was needed to assure investors that all was in control. Greenspan expressed worry about the stock market and the currency market, and was especially concerned that a loss in stock value would have a significant negative wealth effect. So, the Fed raised by 75 basis points to investors surprise and relief and bull markets began for bonds and stocks and the dollar continued to strengthen. The idea that a decline in stock and bond markets could be good for us makes no sense to me, and I hope the Fed would again try to ward off such an occurence.

Subject: Deflation coming home
From: johnny5
To: All
Date Posted: Fri, Mar 18, 2005 at 16:56:03 (EST)
Email Address: johnny5@yahoo.com

Message:
THE USA IS LUCKY THAT CHINA CANNOT SHIP HOUSES TO OUR ECONOMY. http://www.321gold.com/editorials/willie/willie031705.html Export Inflation, Import Deflation Jim Willie CB Archives Jim Willie CB is the editor of the 'HAT TRICK LETTER' Mar 17, 2005 For specific detailed analysis of the Gold, USDollar, Treasury bonds, and inter-market dynamics with the US Economy and Fed monetary policy, see instructions for subscription to my newsletter research reports, which include stock recommendations positioned to rise in the commodity bull market. Inflation remains the principal object of misunderstanding in the investment world. The criticism extends to the gold community. Massive US money supply growth in no way ensures a rampup in the gold price. We certainly do not measure inflation properly, as most give little credence to the joke CPI statistic. The banking system leaders have intentionally caused confusion on the inflation subject. We see a price rise in sectors where money flow travels or is directed, since bubbles come from applied monetary force in a bounded arena. THE USA IS LUCKY THAT CHINA CANNOT SHIP HOUSES TO OUR ECONOMY. On the other hand, we see a price decline in sectors where money flow is denied or neglected, since Asia floods our markets after exploiting its unlimited labor surplus. Federal Reserve spokesmen continue to spew nonsense about how 'inflation is gaining' or 'threat of deflation must be contained,' as though they are mutually exclusive, one occurring but not both. The Fed's method of dysfunction, corrupted by Fed loyalty and collusion with the USGovt, is to take indicator cues from the real economy (battling with severe recession) and use distress signals as justification for evermore free-flowing liquidity and easy money stimulative policy for the financial sector (in near constant steroid supply). My pen enjoys metaphors and imagery. They are effective to drive home a difficult point. Greenspan has a pack of relentless pit bull dogs biting his arse with secular deflation, seen with busted bubbles in the past, lost jobs to Asia, and steroid-driven bond speculation. He responds to soft prices in certain arenas and the onset of slower money flow (liquidity). Greenspan at the same time has a pack of vicious doberman dogs biting his genitalia with a systemic rising cost structure in concert with asset inflation. Action taken to protect his hind end jeopardizes his frontal jewel box. Actions taken to protect his exposed cod piece jeopardize his rear flank. The US Economy is victimized by the two packs of vicious dogs. In time, my expectation is that our corrupted, myopic, bewildered Fed Chairman will lose both his seat and his seed, rendered a pathetic shell of a man with only legs and a head. He will run away from his past, and speak more in rationalization and alibis, blaming others. In the end, like the middle class, his entire midsection will be ravaged front and back by both dogpacks. A grand middle class squeeze has accelerated, which has become asset rich with their homes but cash poor with income and cash flow. This article will not address whether secular deflation has the upper hand, confirmed by the continuing 25-year bond bull market. Reporting on that titanic struggle is for another day, a frequent topic in my Hat Trick Letter. My view is a bond top, marked by bottoming yields, has surely begun to be evident. However, the jury is still out on whether the US long-term decline in interest rates (10-yr TNote) will resume, and will work to converge with Japanese long-term rates. Hedge funds seem to apply leverage in that direction. See how the recent rise in our TENS yield is still beneath the downtrend. EFFECT OF GLOBALIZATION The US Economy is NOT a closed system, surely not since globalization. As a nation, we choose to contain our inflation for the benefit of assets, since we cave in to human laziness, drawn arrogantly to intellectual pursuits and toward a cleaner environment in the process. The mushroom price effect in stocks, bonds, housing all fits like a glove with the 'American Dream.' We choose to permit foreigners to perform our spadework, but the rub is that such a choice (passive or active) kills our economy. Destructive, incompetent, heretical economic policy and leadership has backfired to squeeze the US middle class beyond the field of vision from our financial press. We actually believe we can run monetary presses (counterfeit money printing operation) with impunity as we export our debts abroad. With 'flexibility' comes a heavy cost of erosion in job quality and quantity. The US Economy endures a roundtrip for inflation, and must overcome the deception that we avoid effects of rampaging hyper-inflation. By that is meant an explosion of money supply (inflation in pure form). Monetary expansion typically goes to asset groups, to industrial buildup, or to consumption. In the USA it tends to go domestically into assets (stocks, bonds, housing) and into wasteful spending. We export much debt to Asia, where they build factories and ship their output to our shores. See our big-box superstores, an endless chain of retail chains which sells Asian finished products. Try running a small business with any of these guys within your 5-mile trade zone. That is bigtime pricing power stress and a crimp on either hiring or expansion. The ugly hidden cost of exporting inflation and importing Asian output is that we in the USA lose wages and replace them with debt. We miss out on the entire trickle down multiplier effect, from all the supply industries. Those benefits reside in Asia. The 'Orwellian spin' by the USGovt is that we retain higher grade jobs, when the truth is that we arrange lower grade jobs in their replacement. A constant complaint and criticism from me in public and newsletter writing is the abysmal comprehension and total lack of proper teaching on the subject of 'inflation.' We tend to incorrectly regard any price rise as inflation. If the item being priced suffers a sudden jump, like say with orange juice after the shock of a damaging crop freeze to the groves, that is not price inflation. Rather, it is a price adjustment to address a shortage of products in inventory. If a flood of automobiles rolls to dealer lots as a result of forced job continuation and labor contracts to block worker layoffs, the lower car prices from incentive sales programs is not price deflation. Rather, it is price adjustment to address a surplus of products in inventory. On the other hand, if lower interest rates spawn an enormous speculative frenzy to invest in residential property, even second homes (as occurs now), and housing prices rise, yes, that is indeed evidence of inflation. Too much newly printed money has chased housing property. If easy money Fed stimulus is enables negative real interest rates, and bonds escalate in principal value, yes, that is indeed evidence of inflation. Too much newly printed money has chased bond securities. The wise fool who heads our Federal Reserve would have you think falling stock prices were the result of deflation. He would have you think falling car prices are the result of deflation. He would have you think falling consumer prices for electronics, cell phone, and computers are the result of deflation. In 2001, Chairman Greenspan ordered a new round of monetary inflation (increased money supply infusions) to combat debt collapse and speculative reversal, which had their root cause in excessive monetary inflation. So the cure for the harmful effects of monetary inflation was to be more ordered monetary inflation? Therein lies the insanity of policy, which is heartily endorsed. It is accepted partly because of ignorance to inflation, partly because of Wall Street eagerness to benefit from directed new money investment into familiar arenas. Those arenas after 2001 were bonds, mortgages, housing, and with stocks, enough to tread water. Simply stated, inflation is defined as money supply expansion, rising money supply, manifested often from an increase in debt and a flood of liquidity from Fed bond purchases, a basic growth in the monetary base. Take your definition pick. It is not the blister bubble on the bicycle tire, but rather the increased air supply from operating the pump !!! The money can be from new business expansion, from expenses for equipment & training, from mergers & acquisitions, from added margin debt for stocks, from Fed open market purchases with money out of thin air, from foreign central bank interventions to purchase new US Treasurys, from added hedge fund borrowing for speculation, from new consumer debt for household purposes, from large retail item purchase, from new car purchases, from rabid real estate activity, from home remodeling, from vacations, from dream motor boats. Notice only the first two examples pertain to constructive purposes. The remainder pertain to potentially destructive purposes. Cars and homes are surely necessities. But a second home on a lakefront is not. A new car every two years is not, which has crushed used car prices. A bigger house trade-up is not when children have moved out. The tendency has been to go toward bigger cars, including SUVs, toward bigger houses over 3000 square feet affectionately dubbed 'MacMansions.' Easy money has encouraged waste and speculation. THE EXODUS EXPORT OF MONETARY INFLATION Since the mid-1990 decade, a phenomenon has shown itself and taken root. The US trade deficit has grown in size, even as the US monetary base (money supply) has also grown. The constant has been that US debts always grow annually. We are the greatest debt abusers in mankind history. A phrase caught my attention over ten years ago. FOR YEARS THE USA HAS EXPORTED INFLATION. New money can be directed to go toward businesses, toward assets, or toward basic consumption. If into businesses to excess, then you tend to see over-production, over-hiring of workers, excess output, and eventual liquidation marked by lower prices. If directed into assets to excess, then you tend to see price bubbles, a boom frenzy in speculation, a trumpeted bull market, and eventual busts. If directed into consumption to excess, then you tend to see abusive size, inefficiency, suffocation, neglected health, debt overload, delinquency, default, and bankruptcy. The US Economy last saw over-investment in the telecommunications industry with too many cellular towers, too many cell phone carriers, too many long distance phone carriers. We saw over-investment in personal computer makers, and fiber optic supply firms. All suffered liquidations, consolidations, acquisitions, and revamped businesses. Consumers benefited with lower prices. We call it 'creative destruction.' We regularly and frequently over-invests in assets. We love our stocks, bonds, and housing. What easier way to make money than to anticipate properly the next 'trend' which in actuality, such practice is just to discern and anticipate where the next inflationary destination and routes will be. Well, the creative destruction nowadays has the US Economy suffering the destruction, while Asia enjoys the creation. Our wastefulness, insane economic policy, and desire to gamble rather than work have led to a mountain of debt which has been financed by foreigners. The veritable hemorrhage of trade surplus has been recycled into US Treasury debt, into US agency mortgage debt, and into vendor financed purchases in consumer debt. The USA has eluded rising prices by selling our debt securities to foreigners, outside our boundaries. We pretend we are selling assets in a fair trade. We are instead permitting foreigners to acquire an additional 1% of the entire US asset base each year in exchange for supplying our economy with cheaper goods produced abroad by foreign workers. We force our debt onto the world, which in a sense feels compelled to purchase it. THE USA EXPORTS INFLATION (in a monetary sense). We export debt. THE ROUND-TRIP IMPORT OF PRICE DEFLATION An overlooked statistic is that US consumer debt has been growing in lockstep with the Chinese trade gap (bilateral to USA). Total consumer debt, from both revolving and installment sources, has risen almost 22% since January 2001, from $1711 billion to $2085 billion through November 2004. During the same stretch of time, the Chinese trade deficit accumulated by a commensurate $440 billion. Hmmm, similar magnitude !!! The result of Fed stimulus has been a massive Asian factory buildup. Their central banks have ensured that currency corrections do not interrupt the 'grand giveaway' by mindless US officials, which includes technology given by our corporations. Yes, we donate our main comparative advantage to Asia, principally China. The Asian imported product influx has greatly suppressed product prices in the real economy, where things are made. Imports dominate systemically. Whether it be Wal-Mart, KMart, Circuit City, Best Buy, Staples, Office Depot, Home Depot, or Lowe's, our stores are stocked with products made in Asia. The supply chain stocking of our retail shelves represents a round trip from the exported inflation. We export inflation in the form of trade deficits and foreign purchases of debt. They invest in new factories across Asia, recently in China. Their output is sent to the US Economy, as we import it. WE IMPORT DEFLATION (in a falling product price sense). When money leaves our nation, passes through Asian factories, then returns, it is transformed from excess demand in the form of money to excess supply in the form of products. Inflation eventually pressures demand or pressures supply. Over-investment such as is in progress in China yields excess output and lower prices. It really is not so simple, since Chinese labor costs are 3% to 5% of the US labor costs. They have over-built factories though, and under-built the necessary roadways, electricity generation capacity, port loading docks, and truck & rail facilities. The last time severe over-investment occurred in Asia was 1995 to 1997. Thailand over-built cities. Korea over-built technology supply. The entire PacRim of Asian Tigers over-built in technology supply also. The Asian Meltdown followed. The key to US observers is to note how prices systemically in the finished product arena are kept low because we import deflation from Asia. Americans complete the process by shopping in the malls and bigbox superstores, which rekindles the cycle once more. The vast recycle of Asian trade surplus into US Treasurys is well-known. Their purchase support, if not intervention, keeps the long-term interest rates low. That is the financial side of the exported inflation equation. However, a pernicious additional force is at work. We as a nation believe we get off scott-free by shoving our factory load to Asia. The White House Council of Economic Advisors and Fed Chairman Greenspan speak openly about the low-cost advantage taken from Asian output. We believe we can export debt without consequence. The US exports inflation, only to see it return in the form of imported cheap products from Asia. We import deflation on the back end. This effectively kills pricing power and kills jobs. So the US consumer is helping to flatten the yield curve also. This is the commercial side of the exported inflation equation. Identified in this article is but one more symptom of the failed Fed Reflation initiative discussed over many months in the Hat Trick Letter, whose March issue was just posted.

Subject: Market cap to GDP
From: Pete Weis
To: All
Date Posted: Fri, Mar 18, 2005 at 15:08:52 (EST)
Email Address: Not Provided

Message:
I wonder if Bill Gross and others are right about CPI being understated and therefore GDP overstated. But even if GDP is being properly stated this article points to an interesting observation about the value or lack thereof of the stock markets. Morningstar.com Outsmarting Market Trends Wednesday March 16, 6:00 am ET By Curt Morrison, MD, FACC Shortly before the stock market crash of 1929, Yale economist Irving Fisher famously declared that stocks had reached what appeared to be a permanently high plateau. Undoubtedly, Fisher was neither the first person nor the last one to believe that prevailing conditions would never change. Those ideas appear to be as common at market bottoms as they are at market tops. Yet if history reveals one permanent feature of business conditions or stock returns, it is this: They change. In fact, they tend to change cyclically. If the cycles lasted only one week at a time, then no one would be fooled by them, but bull markets, bear markets, and business cycles can last for years, and their relative durability seduces investors. Among other reasons, I think this occurs because many investors lack a historical perspective, and many more have a short-term focus. Patient, knowledgeable investors can avoid this pitfall by valuing securities and the broad market based on normalized results. This sort of analysis warns investors away when market prices imply that peak performance will be sustained over the long term, and it invites them to take advantage of a sort of arbitrage opportunity when prices imply that adverse conditions will never improve. That is, patient investors can profit on the arbitrage between their long-term horizon and the short-term focus of many other market participants. Estimates of normalized results can be made with moderate confidence for mature companies, and with greater confidence for entire industries. Because we have more than 130 years of data on the broad stock market, and because it represents a major portion of the entire national economy, we can estimate its normalized results with the highest degree of confidence. I've described some examples below. Be wary when peak operating margins are projected over the long term. Aetna (NYSE:AET - News), Humana (NYSE:HUM - News), and UnitedHealth Group (NYSE:UNH - News) have all posted rising operating margins during the last several years, and all three companies have enjoyed a sharply rising stock price. However, the same could be said for most of their peers. In my opinion, managed-care companies have enjoyed an optimal environment between 2002 and 2004, but industry conditions have been cyclical in the past, and there are signs that the cycle peaked in 2004. Despite this, current stock prices appear to discount a continuation of recent peak or near-peak operating margins and organic sales growth rates over the long term. Drug companies have stumbled, but long-term prospects probably haven't changed. Contrarily, opportunities are created when short-term industry difficulties lead to lower long-term expectations. Last year's headlines were full of bad news for pharmaceutical companies, and their stocks fell to valuation levels last seen a decade ago (you can read more about the subject here and here). Although the research labs have been relatively unproductive at a number of these companies in recent years, the pharmaceutical industry has been extremely profitable for decades. Dry spells have always been followed by a new wave of discoveries, and it seems unlikely to me that the progress of medicine will slow in the decades ahead. Ground-breaking drugs create their own demand, and as long as the normalized productivity of future pharmaceutical research approximates that of the past, these companies should continue to post stellar growth and profitability in the decades ahead. In bear markets, investors expect bad times to last. In a similar vein, Warren Buffett wrote an article in 1979 explaining that the broad stock market offered excellent value. Inflation was high then and stock returns had been poor for seven long years. That was also the year that BusinessWeek famously ran a cover story titled 'The Death of Equities.' Irving Fisher described a permanently high plateau in 1929, but 50 years later, investors thought they saw a permanently low valley. Although it's possible for individual companies or even whole industries to suffer a permanent impairment, investors can be much more certain about the future of the entire market. Measured by the normalized P/E or the Q ratio (read more about these metrics here), the stock market sold at only 60% of fair value in 1979, but over the very long term these measures must revert to fair value as long as markets function freely. Insightful investors had an opportunity to profit on the arbitrage between their long-term outlook and the shorter term gloom reflected in market prices. As it turned out, a long-term outlook was required because the market's valuation fell to only half of a fair level by 1982. As Buffett is quick to admit, he has no idea what the market will do in the short-term--and three years is a short period in the stock market. Nevertheless, conditions did change eventually, and 1982 marked the beginning of the greatest bull market in history. Today's prices assume peak margins and high valuations are permanent. Unfortunately, I think that today's stock market is a polar opposite of 1979. It is markedly overvalued by the normalized P/E or Q ratio, as well as by Buffett's favorite metric, the ratio of total market capitalization to GDP. That ratio was recently about 1.3 against a long-term average near 0.62 and a long-term median of roughly 0.56. There are probably many contributing reasons for this unhappy state of affairs (unhappy because it means that prospective returns are low), but one might be analogous to the situation described for managed-care companies. Jeremy Grantham calls corporate profit margins the most reliably mean-reverting series in finance, and Buffett wrote that the margin (total aftertax corporate profits as a percentage of GDP) generally remains between 4% and 6.5%. He remarked that it's rare for the rate to go above 6.5%. However, that margin reached 7.92% last year, according to a report by Arnold Van Den Berg. That value was exceeded only once during the last 80 years--in 1929. Given that profit margins are mean-reverting, investors ought to assign low P/E ratios to high-profit margins and vice versa. In this way, investors could properly account for normalized long-term results. Yet, according to data presented by Grantham, they tend to do just the opposite. Investors in 1979 shared the outlook of their peers from 1932, a terrible year in the stock market, but today's investors have more in common with those of 1929, in my opinion. Too much importance has been assigned to unsustainable current conditions, and too little attention has been given to normalized estimates of profit margins, interest rates, and earnings growth. Just as independent-minded investors with a long-term focus profited by recognizing that bad conditions were likely to improve in 1979, like-minded investors today should heed the warning flags the market is waving: The normalized P/E, Q ratio, and market-capitalization/GDP ratio are unsustainably high.

Subject: Well Done
From: Terri
To: Pete Weis
Date Posted: Fri, Mar 18, 2005 at 15:55:38 (EST)
Email Address: Not Provided

Message:
Excellent articles. The concerns here need to be carefully looked to, and I will respond in several posts. We must think of the potential problem, and what widespread and personal responses might be.

Subject: Re: Market cap to GDP
From: johnny5
To: Pete Weis
Date Posted: Fri, Mar 18, 2005 at 15:50:11 (EST)
Email Address: johnny5@yahoo.com

Message:
Pete assuming we are at a peak that will drop like 1929 - is this the best time to stick all that social security money into the market? Won't the president be putting our citizens into the market at the worst possible time in history? He wouldn't do that would he? Where is paul krugmans retirement money invested? gold coins? collector wine?

Subject: Tipping points
From: Pete Weis
To: All
Date Posted: Fri, Mar 18, 2005 at 14:56:33 (EST)
Email Address: Not Provided

Message:
Mar 18, 2005 Global: America Smells the Coffee United States: Consumers Ready for Challenges Ahead China: Mild Anti-Speculation Measures Global: America Smells the Coffee Stephen Roach (from Beijing) Tipping points are a great concept, but virtually impossible to identify ahead of time -- let alone when they are occurring. It is only with the great luxury of hindsight that we can look back and know that the proverbial bell has rung. In my view, March 16, 2005 could end up in the running as a possible tipping point for America. Suddenly, the US has taken on a very different aura in an increasingly unbalanced world: The confluence of a record current account deficit, a disaster from General Motors, and yet another new high for oil prices all speak of an increasingly precarious role for the global hegemon. World financial markets have barely begun to sniff that out. The current account deficit probably says it all. As I have noted ad nauseum, it is an outgrowth of America’s biggest problem -- an unprecedented shortfall of national saving. The US net national saving rate -- the combined saving of individuals, businesses and the government sector (all adjusted for depreciation) -- has fallen to a record low of 1.5% since early 2002. Lacking in domestic saving, America must import foreign saving from abroad in order to keep growing at what the body politic judges to be acceptable growth rates. And so the US must then run massive and ever-widening current account deficits to attract that foreign capital. And ever-widening it is: America’s broadest measure of its external shortfall was just reported to have hit an all-time record of 6.3% of GDP in 4Q04 -- an astonishing 1.8 percentage point deterioration from the 4.5% deficit a year-earlier in 4Q03. Not only is this a record current-account deficit for the US, but it is also a record financing burden for the rest of the world. Based on the annualized current account deficit of slightly more than $750 billion in the final period of 2004, America now requires an average of $2.9 billion of capital inflows each and every business day to keep the magic going. “What’s good for General Motors is good for America.” I realize that dates me, but I’m old enough to remember when that was the battle cry of a once mighty Smokestack America. So when GM throws in the towel on earnings (again) and its bonds trade at near-junk status, maybe there’s more to this story than a quick flicker on the screen. The ever-cynical comments on chatrooms were quick to minimize the significance of this event: “What do you want from a healthcare provider dressed up as an auto company?” Yes, Detroit is now a shadow of its former self -- US automakers currently employ only 0.8% of all workers in the US. In many respects, that’s emblematic of the fate of the factory sector as a whole, where the job share has plunged from 33% of private nonfarm payrolls in 1960 to around 13% today. The demise of US manufacturing is now taken as a given and most simply dismiss GM’s latest travails as a non-event. I think there is a deeper meaning to all this -- especially coming on a day when the current-account deficit was reported to have taken yet another ominous leap into uncharted territory. Not surprisingly, the US trade deficit on goods accounted for fully 98% of America’s total current account deficit in 4Q04. That’s right, a once proud Smokestack America has borne the brunt of the unprecedented US saving shortfall. And just as GM led the charge in the heyday of America’s manufacturing prowess, it is now on the “bleeding edge” of its darker days. Coincidence? I doubt it. It may well be that the accelerated erosion of America’s manufacturing base in recent years is the most painful outgrowth of a record US saving shortfall. Washington, of course, wants to pin the blame on unfair foreign competition. Instead, it ought to take a look in the mirror: It is the budget deficit, of course, that has been crucial in pushing national saving to record lows in recent years. And it is the capital inflows -- and the trade deficits behind those flows -- that are required to compensate for these budget deficits and give a saving-short America the foreign aid it needs to keep on growing. March 16 was also a day of record oil prices. No, this is not just America’s problem. But in a falling-dollar climate, other nations enjoy a cushion from this blow as their currencies rise. Not so in the US as the current account deficit keeps the greenback under pressure. The press, of course, is filled with commentary about how oil no longer matters. All I can say is -- been there, done that. My experience tells me that this is precisely the rhetoric we always hear in the midst of an oil shock. And shock it is: In real terms, $56 oil represents more than a quadrupling from the lows of late 1998 -- putting this price spike very much on a par with those devastating blows of the 1970s. The apologists will tell you not to worry -- that the real price of oil is still below record levels hit in the late 1970s. That is poor macro, to say the least. Impacts to economic growth are not about levels -- but about changes. The sharp run-up of oil prices in these past few years is the functional equivalent of a tax on household purchasing power that only puts further pressure on an already over-extended American consumer. The fact that consumers haven’t caved yet doesn’t mean the Holy Grail of a new immunity to rising oil prices has been discovered. It could mean that something else has temporarily deferred the endgame. That “something else,” in my view, goes right back to America’s biggest hole -- the current account deficit and the capital inflows from abroad that keep funding it. Recent US Treasury data suggest this is not a problem -- net portfolio investment of $91.5 billion in January 2005 that was more than enough to cover the $58 billion trade deficit that month. The Washington spin is that foreigners can’t get enough of dollar-denominated assets and the returns they offer in an otherwise return-starved world. Don’t kid yourself. This rush of foreign capital is not about private investors plunging back into US assets. It is a conscious policy move on the part of foreign central banks. The US Treasury data do not accurately reflect the obvious -- an extraordinary build-up of dollar-denominated official foreign exchange reserves held by the world’s monetary authorities. By our estimates (based on IMF data), total reserves increased by about $700 billion from year-end 2003 to year-end 2004. Assuming that the dollar share of such holdings held steady at around 70% (an official BIS estimate as of late 2003), that implies an increase of nearly $500 billion in dollar-denominated holdings of the world’s central banks -- confirming that foreign central banks financed about 75% of America’s current account deficit last year. That policy-driven financing is a bold effort on the part of foreign central banks to keep their currencies from rising and defer what could be an otherwise painfully classic US current account adjustment -- complete with a further decline in the dollar and sharply higher US interest rates. The resulting subsidy to US interest rates -- and the asset-driven consumption that engenders -- goes a long way in cushioning the blows of stagnant real wages and surging oil prices that might have otherwise clobbered the American consumer. But the message from overseas is that this game is just about over. One by one, Asian central banks -- America’s financiers at the margin -- have dropped the not-so-subtle hint that they are saturated with dollar-denominated assets. From Korea and Japan to China and India -- not to dismiss Malaysia, Hong Kong, and Singapore -- there is a growing protest to massive dollar overweights in official reserve portfolios. The standard American response borders on arrogance: “What choice do they have?” The presumption is that the US has externally driven Asian economies over a barrel -- unwilling to accept a deterioration in export competitiveness that currency appreciation might bring. This misses a key cost-benefit tradeoff -- weighing the hit to exports against the fiscal cost of a portfolio loss on holdings of dollar-denominated assets. The bigger the build-up of dollar reserves, the more this tradeoff is likely to tip toward dollar diversification -- spelling the end of America’s cut-rate foreign financing. In the end, of course, there’s far more to this story than economics. As I noted recently, history is replete with examples of leadership tests that pit a nation’s military prowess against its economic base (see my 28 February dispatch, “The Pendulum of Global Leadership”). Yale historian Paul Kennedy has long argued that great powers typically fail when military reach outstrips a nation’s economic strength. In that vein, there’s little doubt that America is extending its reach in this post-9/11 world. Wars in Afghanistan and Iraq were the opening salvos. The Bush Administration’s recent nomination of two leading neocons to key global positions -- John Bolton as America’s ambassador to the UN and Paul Wolfowitz to head the World Bank (also announced on March 16) -- are more recent examples of a White House that is upping the ante on its “transformational” projection of global power. In Paul Kennedy’s historical framework, America is extending its reach at precisely the moment when its economic power base is weakening -- a classic warning sign of the fall of a Great Power. Was March 16, 2005 America’s tipping point? Only time will tell. The optimist can hope that it was a wake-up call for a saving-short US economy to put its house back in order. For once, call me an optimist. It’s time for America to smell the coffee.

Subject: Well, Possibly
From: Terri
To: Pete Weis
Date Posted: Fri, Mar 18, 2005 at 19:54:43 (EST)
Email Address: Not Provided

Message:
Well, yes, I am worrying more lately.

Subject: Canada and Oil and Boom Towns
From: Emma
To: All
Date Posted: Fri, Mar 18, 2005 at 14:22:22 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/18/international/americas/18alberta.html Looking for Recruits for the Frozen North? Try the Tropics By CLIFFORD KRAUSS FORT McMURRAY, Alberta - Forty below zero isn't so bad once you get used to it. At least that was the message of a seminar at Keyano College called 'We Love the Winters Here,' attended by 30 new immigrants from warm-blooded places like Venezuela and Nigeria, drawn here by the promise of hefty salaries in an oil boomtown. Of course, the lecturers noted, there are some important things to remember about living in this sub-Arctic town where winters last eight long, blustery months. For one thing, children must be taught that it is dangerous to stick their tongues on freezing metal poles. There are risks to warming up a car inside the garage, and there are ways to drive out of a skid on an icy road. It is all part of life in what was once a God-forsaken cowboy outpost until several multinational oil companies ratcheted up their oil sands operations here in recent years. In two decades, the population has nearly doubled, to 60,000 from 35,000. There is a lot of money to be made here, especially with oil prices over $50 a barrel, plenty of high-paying jobs and a real estate boom, which have all helped make just about everyone, blue-collar workers included, feel prosperous. But few Canadians from relatively balmy places like Vancouver and Toronto have the gumption to live in these frigid climes, so oil company recruiters are looking far and wide. Amazingly, they are finding plenty of hearty, well-trained and highly motivated people from places where 70 degrees Fahrenheit is considered chilly. 'What do you prefer,' asked Ligda Massicotte, 38, a lawyer who left the chaos of her native Venezuela four years ago. 'A country where there is kidnapping, crime, revolution, political uncertainty or a country that is cold where you have to put a hat on?' Nevertheless, Ms. Massicotte and her fellow English-language students at Keyano say the constant need to shovel snow and the short, dark days take some getting used to. 'When we first got here, my husband would say 'Let's go out,' ' she recalled, 'and I'd say, 'Oh honey, we have to dress the kids, two socks on each, then the long underwear, then the long-sleeve shirts, then the snow suit, then the mittens, then the hats, then the scarves.' Then as soon as you're ready one of the kids would pooh, and you'd have to start all over again. We'd always be an hour late.' Venezuela, where President Hugo Chávez fired more than 5,000 employees at the state oil company after a failed general strike, has been particularly fertile recruiting ground for energy companies. 'When you are in Venezuela and you read the word 'cold,' you don't really know what that word means,' said Cesar Mogollon, an electrical engineer with Suncor Energy who arrived from Venezuela in November. 'The first time I went out at minus 40 during a safety tour around the plant in early December, I was dying,' he said. 'I felt pain in my nose and ears that went inside. I looked around at my colleagues and asked myself, 'Do they have different blood than me?' ' But Mr. Mogollon said that once he found that local supermarkets carried the white maize flour dough used to make arepas and empanadas, 'I was O.K.' He and his wife have adjusted, he said, and his 9-year-old daughter and 13-year-old son are snow tubing and skiing with gusto. At least 4,000 foreign-born immigrants now live in Fort McMurray, and the number is growing fast. Local supermarkets carry halvah from Saudi Arabia, mango nectar from Egypt, jarred yellow cherries from Guatemala, rice sticks from the Philippines and marinating sauces from South Africa. There are cultural organizations for Latinos, Hindus, Filipinos and Chinese. The first Islamic school opened last year. Mushtaque Ahmed, a 54-year-old engineer at Syncrude Canada, who was born in Bangladesh, has worked previously in Iraq and Saudi Arabia. He says that 10 families from Bangladesh arrived here in the last three years, and that they now get together to celebrate Bangladeshi holidays with potluck dinners that mix their native cooking with Canadian fare: typically roast turkey and assorted biryanis. There has already been one marriage in the community, he said, and he is trying to persuade his brother-in-law to come here to open a Bangladeshi restaurant. 'I like the friendliness of the people here,' Mr. Ahmed said, although he admitted to one misgiving that has nothing to do with the weather: 'I can get uncomfortable with what's on television. There's a lot of tolerance to things I am not accustomed to.' Immigrants here, like immigrants everywhere, get homesick and cling to their native cultures. Oswald Francis, a 52-year-old Jamaican-born bus driver, still wears a Jamaican flag on a bracelet and on a pin on his lapel. He came here for a three-week holiday in 1977 to visit friends, and never left, in large part because his wife thought this could be a good place to raise their two daughters. 'Canada is the best place in the world to live right now, and Fort McMurray is the best place in Canada to live because of the opportunities, the jobs, the money,' he said while shopping for a long-distance calling card in a multicultural supermarket. 'As for the cold, I wouldn't call it an adjustment. You never get used to it.'

Subject: Brazil Plane Maker Getting Big Orders
From: Emma
To: All
Date Posted: Fri, Mar 18, 2005 at 14:20:46 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/18/business/worldbusiness/18embraer.html Brazil Plane Maker Getting Big Orders for Smaller Jets By TODD BENSON SÃO JOSÉ DOS CAMPOS, Brazil - Workers at the sprawling aircraft factory here, some 50 miles northeast of São Paulo, are assembling a new kind of plane that JetBlue Airways is betting will let it take its low-fare, low-cost philosophy to dozens of previously ignored destinations across the United States. The new plane, by the Brazilian jet maker Embraer, is a far cry from the cramped 50-seater that airlines normally use on shorter hops. In fact, it is roomier than the 156-seat Airbus A320 that JetBlue currently flies. Like it, the Embraer jet will have leather seats and digital entertainment systems for each passenger. But instead of six seats in each row, the new plane will have just four so no passenger has to sit in a middle seat. The result will be a 100-seat regional jet with expanded range and the comfort and feel of a big airliner at a fraction of the cost. The plane, the Embraer 190, is part of a family of four next-generation, 70-to-118-seat jets that may finally thrust Embraer past its archrival in the regional jet market, Bombardier Inc. of Montreal, and also allow Embraer to gobble up a potentially lucrative aviation niche ignored by the world's top two aircraft makers, Airbus and Boeing. 'Embraer did its homework,' said Douglas Abbey, a partner at the Velocity Group, an aviation consulting firm in Washington. 'They identified a hole in the market and went after it. And they're just now reaping the rewards because they have an aircraft that embodies all new technology and all new levels of comfort.' JetBlue will become the first airline to fly the Embraer 190, in October, and plans to put seven into service by year-end. It has 100 on order, for delivery through 2011, and an option to buy 100 more. Analysts say the planes will help JetBlue reshape the aviation industry in the United States by bringing affordable air travel to smaller cities that have long been shunned by budget airlines as too costly. Discount airlines like JetBlue are not the only ones adding Embraer's roomier little jets. Major airlines are turning to smaller planes by Embraer and others as they seek to bounce back from the post-9/11 travel slump and avoid losing money on routes where seats outnumber passengers. Embraer, short for Empresa Brasileira de Aeronáutica, is also pitching the planes to regional carriers looking to carry more passengers and serve longer routes. Embraer estimates that demand for the jets could exceed 5,800 over the next two decades. It already has firm orders for 343. [The company said Thursday that profit more than doubled last year, to a record $380.2 million.] 'Regional airlines want to expand, legacy airlines are trying to cut their operational costs, and low-cost airlines are choosing another kind of product to serve smaller markets,' said Maurício Botelho, Embraer's chief executive. 'This is a family of planes that is adapted exactly to that concept.' Airlines on both sides of the Atlantic have been buying. US Airways has 22 Embraer 170's - a 72-seat version of the 190, and the only jet in the new family to fly commercially so far - with 63 more on order. Air Canada, shifting to smaller aircraft as part of its restructuring, plans to add 60 of Embraer's new models (as well as just 30 Bombardier jets). Alitalia of Italy and Cirrus Airlines of Germany have begun flying the 170, and Finnair has 12 on order. Still, Embraer faces its share of obstacles. Like its peers, Embraer, which gets more than 70 percent of its revenue from commercial jet sales. For now, Embraer's new jets are not likely to face much competition. Airbus and Boeing are busy trying to outdo each other with planes that seat hundreds of passengers. And Bombardier, the world's leading producer of regional jets, currently makes only stretched versions of its older-style 50-seat commuter planes that seat up to 86 passengers. 'When the competition comes to the market, the good news for Embraer is they've got probably a five- or six-year lead on anybody,' said Ronald J. Epstein, a Merrill Lynch analyst in New York. Embraer, which was created by Brazil's air force in 1969, was privatized in 1994. Mr. Botelho, an engineer with no aviation experience, was brought in, and soon made it a major regional jet maker by selling 50-seat commuter planes. It is now one of Brazil's most global companies, with more than 14,000 employees in six countries, including the United States . In the late 1990's, both Embraer and Bombardier realized that regional airlines wanted larger jets. Although Bombardier got its jets to market quicker, Embraer's new planes have cockpit technology rivaling that found in Airbus and Boeing jets, wider seats and a new fuselage with a special shape that allows for more head room and cargo space. Bombardier is trying to raise $2 billion to develop jets with an all-new design that it hopes to put in the sky by 2010. But unlike Embraer's new planes, Bombardier's CSeries, with 110 to 135 seats, is intended to be 'a mainline carrier,' according to John Paul Macdonald, the spokesman for Bombardier Aerospace. Bombardier, which has received authorization from its board to start marketing the CSeries, plans to showcase the new plane at the Paris Air Show in June, Mr. Macdonald added. is eyeing a niche that it believes Airbus and Boeing are neglecting by focusing on bigger planes - a niche Embraer specifically avoided when it started developing its new planes - the 'big dogs' yard,' Mr. Botelho calls it. Instead, Embraer chose to go smaller after finding that on average more than 60 percent of all flights in the United States, its biggest market, take off with 70 to 110 passengers. Analysts expect orders for Embraer's new jets to jump in the next few years. And there are signs that Embraer, whose big order from Air Canada was widely viewed as a major coup on Bombardier's home turf, may start winning more of its rival's most prized customers. In an internal memo that was leaked to the news media, Fred Buttrell, the new president of Comair, a Cincinnati-based regional unit of Delta Air Lines with an all-Bombardier fleet, said Embraer's new jets were 'critical' to the airline's future. Nick Miller, a spokesman for Comair, confirmed that it was looking to add 35 jets through 2008, possibly 10 of Bombardier's 50-seat CRJ200's and 25 Embraer 170's, but he said no decision had been made.

Subject: Retirement, the Federal Way
From: Emma
To: All
Date Posted: Fri, Mar 18, 2005 at 14:19:41 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/18/business/18thrift.html?pagewanted=all&position= Retirement, the Federal Way By LOUIS UCHITELLE and RIVA D. ATLAS Brenda Barnett, an electronics technician for the Federal Aviation Administration in Oklahoma City, offers one model for how Americans may fare under President Bush's plan for private Social Security accounts. Her retirement account, part of the pension system for federal employees, has had an average return of just over 6 percent a year since 1997, achieved through a mixed investment in stocks and Treasury securities. 'On the whole, I've made money, not a ton of money, but enough,' she said. Jason O'Dell had a much different experience. Mr. O'Dell, 29, went to work for the government in 1999 as a sheet-metal mechanic at Tinker Air Force Base in Oklahoma City. He joined the Thrift Savings Plan for federal employees two years later, put most of his savings in a stock fund, and got caught in the market's steep decline. His account lost nearly 30 percent of its value. The experiences of Ms. Barnett and Mr. O'Dell, who are among two million civilian employees of the federal government enrolled in the thrift plan, show how giving investors control over their retirement savings can have widely varying results. 'It is all very dynamic, and to take this dynamic thing and translate it into actual average returns is impossible,' said Thomas Trabucco, chief spokesman for the Federal Retirement Thrift Investment Board, which administers the accounts. 'You have to go case by case.' President Bush holds up the federal savings program as a model for the retirement accounts he wants to add to Social Security. He is counting on those accounts to earn enough to offset the cuts that his plan calls for in the current fixed Social Security pensions. The federal thrift plan, however, differs in an essential way from the retirement accounts that the president wants to carve out of Social Security. The thrift accounts are on top of a generous fixed pension for federal employees, while President Bush's proposal envisions the accounts replacing a substantial part of Social Security's fixed pension. The thrift system functions like a 401(k)-type plan. Each of the five funds in the plan has done well enough to meet President Bush's minimum goal of an average annual return of 3 percent, adjusted for inflation. Over the 18-year life of the plan, even the most conservative fund, invested in Treasury bonds, has returned, on average, 6.6 percent annually before inflation, partly because the fees are kept below what Wall Street charges. (That compares with an annual inflation rate in that period of nearly 3 percent.) Near the high end, a fund that tracks the Standard & Poor's 500-stock index had an average return of 12 percent a year. The last 18 years, however, are not a template for the future. Nor do the performances of the five funds mirror the actual experiences of individual investors. Whether a federal employee can earn more than Mr. Bush's inflation-adjusted 3 percent a year over a 30-year to 40-year career depends on the mix of investments that the employee chooses and, above all, on a factor beyond anyone's control: the behavior of stocks and bonds. 'The last two decades have been fantastic for the markets, which does not necessarily mean that the next two decades will be as good, or good at all,' said Jeremy J. Siegel, a finance professor at the Wharton School and the author of 'Stocks for the Long Run' ( McGraw-Hill, 2002). Many investors in the thrift accounts have hurt themselves. As stock prices soared in the 1990's, they took money out of government securities and put it into the S.& P. 500-stock index fund. By the year 2000, the stock fund accounted for nearly 64 percent of all investments, up from 6 percent in 1991, the fund's first year. Then, as stocks fell, money flowed back into Treasury bonds. 'We have always known that people tend to put more money into the stock market toward the peak and are scared out when the market starts to drop,' Mr. Siegel said. 'What they should do is sell stock as the market rises and hold on when it slides. Just buying and holding and not getting scared is a sound plan.' The president's calculations also do not address another issue that government officials have raised, which is the danger that a worker approaching retirement with, say, $200,000 in his savings account might suddenly lose 30 percent or 40 percent of that amount in a market plunge and no longer have the time to recover the loss. The S.& P. 500 fund lost 43 percent of its value from 2000 through 2002. 'The real risk is that someone is holding an investment and it goes down at the wrong moment, just as they are approaching retirement,' said Patrick Purcell, a specialist in social legislation at the Congressional Research Service. Under President Bush's proposal, people would be asked, in effect, to take some of their Social Security payroll tax and invest it in the expectation that the return would be enough to offset the money diverted to the private accounts. A smaller return would reduce retirement income below the present level of Social Security pensions. Whatever the outcome, adding private accounts does not overcome any benefit cuts that might be imposed to help close the long-term financing gap facing the Social Security system. Congress created the Thrift Savings Plan in the 1980's as part of a new retirement system for federal employees similar to private pension plans, which were beginning to change, too. At the time, many companies were offering fixed corporate pensions, which they increasingly supplemented with 401(k) plans. Ms. Barnett, 37, currently contributes 10 percent of her $52,000 salary to her thrift account, and the government, as an incentive, matches the first 5 percent. She could put in as much as 14 percent, but she is divorced, raising two children and her expenses are high. 'The public schools even want you to pay for computer paper,' she said. She considers herself a smart, if cautious, investor. Right now, she has 50 percent of her $39,600 in a Treasury fund and 30 percent in a nearly-as-safe fixed-income bond fund. Only 20 percent is invested in a stock fund, and 10 years before she retires she plans to shift that money into the Treasury fund, she said. The thrift investment board applauds that sort of behavior. To encourage it, the board intends to offer later this year a new investment option, called a life-cycle fund. As an investor ages, it automatically shifts the mix from riskier stocks with their potentially higher returns to a safer and steadier investment in government securities. It is also intended to correct for too much caution when workers are young. Too much money channeled into Treasury securities defeats a goal of the accounts that Mr. Bush is proposing. The Social Security Administration already invests its payroll tax revenue in Treasury bonds. The retirement accounts in a changed Social Security system are supposed to beat the return on these ultrasafe investments to justify the risk. Richard Strombotne, a 71-year-old former physicist who worked for the Transportation Department in Washington, was earning in the low six figures when he retired in 1996 with more than $150,000 in his thrift account. But he could have done even better, he says. Through all the years of saving, Mr. Strombotne kept the money in the Treasury fund, not thinking interest rates would stay so low or stocks would do so well. 'I am a Depression baby and a conservative investor for the most part,' he said, 'and after the stock market crash in 1987, it certainly would make you cautious about investing in stocks.' By contrast, Mr. O'Dell put much of his money in a stock fund. From 2001 to 2003, he contributed 10 percent of his annual salary, which is now $41,000. But the legal expenses of a custody battle for his 9-year-old son overwhelmed him and he stopped saving, after putting away more than $10,000, including the government match. The balance today is only $7,545, all of it in the stock fund. 'With me being my age, I think I'll leave the money in the stock fund,' Mr. O'Dell said. Still another issue in setting up private Social Security accounts is resistance to change. Mr. Bush's proposals would allow people to stay with the present system or switch to his new mix of a fixed pension supplemented by a private account. Federal employees were offered a similar choice in 1987. They had the option to stay with the old Civil Service Retirement System or shift to the new one, with its mix of fixed pension and thrift savings. More than 97 percent declined to switch, among them Edwin Dean, a senior economist at the Bureau of Labor Statistics earning in the low six figures. The old system offered larger fixed pensions for higher-income workers, including Mr. Dean. If they had made the switch, they would have had to make up the difference through the thrift savings accounts. 'The point that I made to myself is that you ought to have a substantial core pension, and I was not going to take a chance on jeopardizing that core retirement income,' Mr. Dean, 71 and now retired, said. The resistance to switching reflected a cautiousness common to many investors. 'We've discovered in behavioral economics that people don't want to get rich with their retirement money,' said Teresa Ghilarducci, an economist at the University of Notre Dame. 'They just want it to be there.' Jonathan Frenkel, 39, an official in the Department of Homeland Security, said he winced when he reviewed his thrift statements in recent years. 'It's tough when you get your statements and the returns are negative,' Mr. Frenkel said. He has been putting 10 percent of his earnings into the plan since joining the government in 1998. He started out with 90 percent of his savings in the S.& P. 500 stock fund and decided to diversify, shifting some money out of that fund as the stock market declined, and investing in both the Treasury fund and in a fund specializing in small-capitalization stocks. In Mr. Frenkel's view, the results could have been much worse. 'Outside the plan,' he said, 'I invested in individual stocks, and they have all taken a dive.'

Subject: Caste the financial net
From: Setanta
To: All
Date Posted: Fri, Mar 18, 2005 at 10:12:31 (EST)
Email Address: Not Provided

Message:
Caste the financial net 14/03/2005 When Portuguese adventurers first arrived in India, drawn by the scent of spices and the lure of money, they set up their trading outpost in Goa. By the middle of the 16th century, the streets of Lisbon were buzzing with stories of gold, spices, exotic women and ready-made fortunes. The Orient was where it was at for any ambitious young man. As well as painted ladies, the word “casta'‘ became commonplace to describe the rigid Indian social hierarchy. Casta in Portuguese means race, breeding or lineage. This is where the term caste, used to describe the Indian social system, comes from. Indians refer to it as the “jati'‘ system. There are 3,000 castes and 25,000 sub-castes in India, each related to a specific occupation. These different castes fall under four basic categories: Brahmins are priests; Kshatryas are warriors; Vaishyas are traders and Shudras are labourers. Caste dictates one's occupation, dietary habits and interaction with members of other castes. Members of a high caste enjoy more wealth and opportunities, while members of a low caste perform menial jobs. At the bottom of the caste system are the Dalits or ‘Untouchables'. Untouchables' jobs, such as toilet cleaning and rubbish removal, require them to be in contact with bodily fluids. They are therefore considered polluted and are not to be touched. Back in the days of the Portuguese traders, such systems were common in many countries. Until the late 18th century, even modern, post-reformation Germany operated a system of Stande or status groups (where society was rigidly delineated into special groups). Likewise, imperial Japan had its system of samurai, merchants and peasants. These caste systems attempt to impose a functional order and stability on society, thus protecting elites from change. Observing the recent developments in the Fyffes/DCC trial, it is easy to conclude that a similar caste system exists in the Irish financial community, where the nature, quality and size of the deal depends on a company's position in the financial hierarchy. First, there are the “big boys'‘ - our 21st century financial Brahmins - who get the best deals, at the best prices, long before the rest of the market. Brahmins are on the boards of publicly-quoted companies, are paid in shares of those companies and can be (as in the Fyffes/DCC case) major investors in the company. When you are that big in a small market, you don't exactly make the regulations, but you damn well understand the rules of the game better than anybody else. Under the Brahmins are the Kshatryas, the warriors. These are the senior executives in the broking business and their preferred clients, who get preferential status on syndicates and are privy to exit strategies which are typically based on selling the asset to a lower caste in a few months or years when much of the value has been taken out. This is euphemistically known as a “turn'' or “flip'‘. Next we have the Vaishyas, the traders. These are the workhorses of the financial market in Dublin and they are typically brokers and their clients - the large pension funds. They work for a wage and rarely get a piece of the direct action (known as “a carry'‘ - a part of the equity in the deal), but they have generous expense accounts, company BMWs and Carton House memberships. They also help fine city centre restaurants do a roaring trade at lunchtime. Below the Vaishyas lie the Shudras, or the labourers who are the smaller brokers and their clients. Typically, new private clients might be those who have made money in property and want to diversify into stock, or maybe those who are topping up their self-administered pension funds with leveraged stock holdings. In good times, they can do well by going with the flow; in bad times, they tend to be the last to know of trouble and often do not get out on time. At the bottom of the caste system, we have the financial untouchables. These are the punters, the amateurs and those who naively believe that the market is fair, transparent and the odds are evenly matched. They are the hundreds of small Elan investors who, through their own actions, got caught up in the hype. They are the ‘Eircom untouchables' - the willing victims of botched privatisations. But like all caste systems, the market couldn't work without them. All markets work on the basis of an asset being shunted on to the next layer of buyers who take a bit of value and shunt on again to the lower caste. The name of the game is not to be the lowest caste holding the asset with nobody to shunt the thing on to. The untouchables are therefore an essential lubricant of the financial market. However, they sometimes do not realise that they are the buyers of last resort, rather than the small-town captains of the universe they like to see themselves as. Observing the evidence this week at the Fyffes/DCC trial - a clash of the Brahmins if ever there was one - one can be left in little doubt about the financial caste system. DCC decided to sell its stake in Fyffes and brokers lined up to place the stock. There was the risk of a huge overhang of the stock - over 10 per cent of the company - and therefore, the caste system got to work. The various different castes lined up their buyers. The aim is to get the deal away with as little impact on the price as possible, so that the Brahmin gets the best price for his asset. All the way down the food chain, different castes of investors will be allocated and different packages, usually at different prices - known as “bloc trades'‘ - will be readied to ensure that the price does not fall when the shares come to the market. What is clear to the outsider is that there are few heroes in the case. When the torch is shone into some of the darker alcoves of our financial market, a picture emerges which is not always pretty. We have a chief executive claiming that he was a “conduit'‘ rather than a “negotiator'‘. What is a human conduit? We are told about plcs issuing what some are contending were misleading statements and, finally, we have senior financial Brahmins suggesting that the market - not themselves or the company selling - negotiated the price of a major share sale. There may be a plausible and reasonable chain of events that makes all this credible - the judge will decide that. But the talk around town indicates that there is a lot at stake here. The industry is based on the myth that everybody has a fair chance, punters can play the casino like everyone else and there is no caste system. This essential illusion is not helped by the daily revelations in the High Court and, as a consequence, the industry is closing ranks. However, in the long run, the viability of the Irish financial market can only be maintained if everybody - even the untouchables - fully understands the risks as well as the rewards of committing cash to any investment. More players in the market would make it more liquid and make it more attractive to companies wanting to list. In fact, one of the problems in recent years has been the number of Irish companies seeking AIM listings in London, rather than Iseq listings. The untouchables were named “Harijans'‘ (Children of God) by Gandhi. He tried to raise their status with symbolic gestures, such as befriending and eating with them. The Irish market needs its own financial Gandhi who will preach openness, transparency and tolerance for all castes. One wonders will such a leader emerge from the detritus of this case. Stranger things have happened. www.davidmcwilliams.ie

Subject: 423 million digital dollars stolen
From: johnny5
To: All
Date Posted: Fri, Mar 18, 2005 at 04:00:30 (EST)
Email Address: johnny5@yahoo.com

Message:
This is what is being reported, I like the ease of throwing the credit card on the table and digital transactions, but they have to bring more protection to this area - what is happening that is not reported and still hidden? http://news.bbc.co.uk/2/hi/uk_news/4356661.stm The plan was to steal £220m ($423m) from the London offices of the Japanese bank Sumitomo Mitsui. Computer experts are believed to have tried to transfer the money electronically after hacking into the bank's systems. A man has been arrested by police in Israel after the plot was uncovered by the National Hi-Tech Crime Unit. Unit members worked closely with Israeli police. The investigation was started last October after it was discovered that computer hackers had gained access to Sumitomo Mitsui bank's computer system in London. They managed to infiltrate the system with keylogging software that would have enabled them to track every button pressed on computer keyboards. Cyber warning From that they could learn account numbers, passwords and other sensitive information. Yeron Bolondi, 32, was seized in Israel after an attempt to transfer £13.9m into an account there. We have undertaken various measures in terms of security and we have not suffered any financial damage Takashi Morita Sumitomo Mitsui Latest coup for hi-tech cops He has been charged with money laundering and deception, but police say their investigation is continuing. His relationship with the gang who tried to break into the network is unknown. They have issued a warning for banks and businesses to watch out for cyber criminals. The National Hi-Tech Crime Unit was launched in April 2001 with responsibility for tracking down the growing range of criminals who operate in cyberspace. Takashi Morita, head of communications at Sumitomo Mitsui in Tokyo, said the company had not suffered any financial loss as a consequence of the robbery attempt. He said: 'The case is still in the middle of investigation so we cannot comment further. 'We have undertaken various measures in terms of security and we have not suffered any financial damage.' This will be discussed by chief executives and others for some time to come and it will further reinforce the need for corporate asset protection systems Richard Starnes Computer security expert Richard Starnes, president of the Information Security Services Association, said: 'We have been talking about the doomsday scenario for quite some time and while this was not actualised it shows the magnitude of the threat to companies.' He told the BBC News Website: 'This will be discussed by chief executives and others for some time to come and it will further reinforce the need for corporate asset protection systems.' Mr Starnes, who works for Cable & Wireless, said key logging software - which detects every key stroke made by a keyboard and can give away crucial information such as passwords - was easy to obtain and quite simple to insert into a company's computers. He said: 'This is the arms race of this era. Police and criminals are constantly trying to stay one step ahead of each other.'

Subject: We are Secure If we Feel Secure
From: Jennifer
To: johnny5
Date Posted: Fri, Mar 18, 2005 at 09:05:27 (EST)
Email Address: Not Provided

Message:
These stories frighten me, so I choose not to pay attention to them. We are secure, if we feel secure. I mean this with complete respect and admiration.

Subject: Re: We are Secure If we Feel Secure
From: johnny5
To: Jennifer
Date Posted: Fri, Mar 18, 2005 at 13:50:37 (EST)
Email Address: johnny5@yahoo.com

Message:
We will be fine if this digital money is stolen, it won't impact you getting food or buying medicine - not in a dramatic way anyways - I play devils advocate in a lot of these messages, but I am very thankful for the benefits technology and the internet has brought, it far exceeds any small rise in prices from false digital dollars chasing limited goods. I just hate when a smart or rich person takes advantage of the system to take easy street and the rest of us have to work hard to get our needs met. Instead of not paying attention, why not try to read more into the technology and make it a new hobby to learn all these new things, it is fun, something new to look forward too everyday, not be fearful of. If I didn't have hackers and thieves and economists to read up on and learn about I would get bored - hehe.

Subject: Learning How to Read
From: Jennifer
To: johnny5
Date Posted: Fri, Mar 18, 2005 at 14:18:27 (EST)
Email Address: Not Provided

Message:
A fine explanation. Knowing that these articles can be read as cautions but not simply to becoe fearful, is helpful. Thank you for explaning, so I know how to read properly.

Subject: Re: Learning How to Read
From: Jennifer
To: Jennifer
Date Posted: Fri, Mar 18, 2005 at 15:28:21 (EST)
Email Address: Not Provided

Message:
We can surely hope your uncle with your help has resolved all problems successfully.

Subject: Using the machines to steal yer money
From: johnny5
To: All
Date Posted: Fri, Mar 18, 2005 at 03:01:33 (EST)
Email Address: johnny5@yahoo.com

Message:
Now kevin mitnick doesn't have to click buttons to steal your billions, he can write programs to do all the dirty work for him - recent headline from slashdot.org: http://it.slashdot.org/it/05/03/15/1341203.shtml?tid=172&tid=1 Observing Botnets with Honeynets Posted by CmdrTaco on Tuesday March 15, @09:38AM from the know-thine-enemy dept. Susan Saradon writes 'The Honeynet Project has released a new paper which deals with the observation of botnets. 'Know Your Enemy: Tracking Botnets' discusses what Botnets are, who is using them, how, and why. It als introduces the tools 'mwcollect' and 'drone' which can be used for collecting an tracking Botnet activity. Nice to read and looking forward to the release of these tools.' FTFA: In one case, bot software detected whether the game 'Diablo II' was installed on the host PC. If the game was present, the program would steal items from the player's characters and drop them at preplanned places in the online game world. The bot net's controller would then collect the items and sell them on auction site eBay, Holz said. I suggest the pkarchive crowd go watch the movie list I presented a few days ago and read books like neuromancer by william gibson - the digital money is being stolen left and right - but what does it matter right? We can just make more - won't all this illegally stolen or generated digital money create problems in the hard asset physical worlds pricing?

Subject: They are using your computes against you
From: johnny5
To: johnny5
Date Posted: Fri, Mar 18, 2005 at 03:53:19 (EST)
Email Address: johnny5@yahoo.com

Message:
Over a Million Zombie PCs http://it.slashdot.org/it/05/03/17/1551255.shtml?tid=172&tid=220 Posted by Zonk on Thursday March 17, @12:56PM from the daaaaataaaa dept. Doyle writes 'A BBC article discusses new research revealing that over 1 million computers have been compromised and are being used in bot nets. From the article: 'The largest network spied on by the team was made up of 50,000 hijacked home computers.''

Subject: Real price of oil after military expense
From: johnny5
To: All
Date Posted: Fri, Mar 18, 2005 at 02:39:15 (EST)
Email Address: johnny5@yahoo.com

Message:
Remember Bogle Heads - COSTS MATTER http://www.change-links.org/oiladdiction3.htm How much did you pay per gallon of gas the last time you filled up your car’s tank? It was probably about $1.75 per gallon, give or take a quarter depending on where you live. In the grand scheme of things, this isn’t much—less, in fact, than you would pay for a gallon of milk. But the price at the pump is nowhere near the real cost of that oil you put in your car. After you figure in the military expenditures of securing and protecting the petroleum, the cost of lost jobs and misplaced investment capital, and the burden of periodic “oil shocks,” the price is much, much higher. According to a recent study by National Defense Council Foundation, the real price of gasoline is somewhere between $5.01 and $5.19 per gallon. That’s as much as $93 to fill up a typical gas tank. Our oil addiction is burning a hole in our pockets, and most Americans don’t even know it. One of the most obvious costs of our oil dependence is the price of maintaining a vast military machine capable of keeping the oil flowing cheaply. Defending just the oil that comes out of the Persian Gulf costs some $42.8 billion a year. This doesn’t include military expenditures in oil-rich Colombia, nor the $87 billion in additional costs for the occupation of Iraq. Then there’s the damage to the economy. According to the study, the economy loses some $160 billion every year because of our addiction—money wasted on unproductive industries and eaten up by health care expenses. Periodic oil shocks—1973-74, 1978-80, 1991—have cost American businesses and consumers another $2.5 trillion. It’s almost as if we’re paying for the dubious privilege of being ripped off. The National Defense Council Foundation is a right-of-center think tank, its advisory board packed with people such as Senators Trent Lott and Orrin Hatch. That a proudly conservative group would go through the trouble of calculating the true cost of oil shows that concerns about the United State’s oil dependence transcend political lines. It’s just common sense: Oil addiction, like any addiction, is dangerous. Yet the NDCF’s numbers, however stunning, still don’t give the whole picture. For example, the study didn’t include the tax breaks and subsidies given to the oil industry. According to an investigation by Friends of the Earth and Taxpayers for Common Sense, the federal government gives oil corporations at least $4 billion a year in corporate welfare—money that comes straight from your taxes. The costs don’t stop there. Oil addiction also contributes to human pain and ecological destruction that are beyond any dollar figure. For how do you measure the value of the species wiped out in the course of oil drilling in sensitive rainforest ecosystems? What price do you place on the irrevocable altering of the earth’s climate? How can you calculate the pain of a mother and father whose son and daughter has died in a war fueled by our relentless demand for oil? There’s not a price tag big enough to capture the costs of such senseless tragedy. Our oil addiction carries a price that we cannot afford to keep paying. After the REAL price of gas is calculated we are not getting a better deal than europe are we? All we are doing with our military is pissing off our old friends - that darn Bush - he makes me so mad sometimes!!

Subject: moneys gone, should have bought houses
From: johnny5
To: All
Date Posted: Fri, Mar 18, 2005 at 02:28:49 (EST)
Email Address: johnny5@yahoo.com

Message:
If they had INVESTED in west palm beach real estate instead of the hedge fund, they would still have hard assets and not 8 million dollar losses for just one person - fools. Like gordon gecko said - a fool and his money are lucky to get together in the first place!! http://www.palmbeachpost.com/business/content/business/epaper/2005/03/18/a1d_hedge_0318.html KL Financial hedge fund official agrees to cooperate By Jeff Ostrowski Palm Beach Post Staff Writer Friday, March 18, 2005 FORT PIERCE — A key figure at a failed West Palm Beach hedge fund has agreed to cooperate with authorities and to turn over $1 million in cash and real estate, federal regulators said Thursday during a court hearing here. John Kim, a Jupiter man who was one of the three principals of hedge fund investment firm KL Financial Group, could give regulators and investors much-needed insight into what happened to tens of millions — and perhaps hundreds of millions — of dollars ponied up by wealthy investors. Kim has agreed to cooperate with the Securities and Exchange Commission and to meet with forensic accountants to lay out the massive scam that led to the firm's huge trading losses, SEC lawyers told U.S. District Judge Kenneth Ryskamp. In exchange for his cooperation, authorities agreed to let Kim keep $46,000 he holds in a joint checking account with his wife, said Michael Tein, an attorney for the court-appointed overseer of KL Financial's assets. Kim will use the money for living expenses and to pay for eye surgery for his 18-month-old daughter, Tein said. He has agreed to give up personal assets that include $150,000 in cash and a property in Korea that could be worth as much as $1 million. 'We're sympathetic to the human needs of his family,' Tein said. 'You can't penalize an 18-month-old baby girl for what her father did.' Authorities on Feb. 25 closed down KL Financial, a firm that wooed wealthy investors by touting outsize returns. Those returns were mostly fiction, the SEC says. The firm's two other principals, Yung Kim and Won S. Lee, have fled to Korea, an SEC attorney said, and Ryskamp on Thursday called them fugitives. Meanwhile, the SEC has confirmed that investors put at least $115 million into KL Financial, according to a report by Guy Lewis, a former U.S. attorney in South Florida appointed by Ryskamp to oversee the recovery of investors' money. Lewis said he has been able to track down only about $2.3 million in the money management firm's bank and trading accounts. Hedge funds like this one are loosely regulated investment vehicles that appeal to sophisticated investors. 'Unfortunately, it appears the overwhelming majority of the money is gone,' Lewis said. Making matters worse, more than $20 million of investors' money appears to have been used by the principals for personal expenses, the SEC said. While the SEC has no authority to extradite Yung Kim and Lee for a civil suit, there are hints of possible criminal charges involving KL Financial. Lewis' report said a federal grand jury is investigating the firm's collapse. Several KL Financial investors attended Thursday's hearing, although none testified and none agreed to give their names to a reporter. Gary Klein, a Boca Raton attorney representing more than 30 investors, called John Kim's apparent cooperation a good sign. 'If he's cooperating and he's giving up that information, that's good stuff,' Klein said. But, Klein cautioned, it's too early to say how far Kim's cooperation will go. Adam Rabin, a West Palm Beach attorney representing an investor he said lost '$4 million to $8 million' invested in the hedge fund operator, likewise hopes Kim will shed light on a complex scheme. 'Getting Kim's cooperation is going to help streamline things,' Rabin said. 'Information is crucial.' Kim didn't appear at the hearing, but he was represented by three attorneys from a Los Angeles law firm. SEC attorneys said they'll extend a temporary restraining order against KL Financial until March 25. The order freezes the assets of the hedge fund and its principals.

Subject: Hack your taxes and beat the gubbment
From: johnny5
To: All
Date Posted: Fri, Mar 18, 2005 at 02:20:40 (EST)
Email Address: johnny5@yahoo.com

Message:
Kevin Mitnick clicked buttons and stole billions in wealth - did that add to the productivity of the world? Is digital wealth controlled by a few a secure world for the masses who don't understand it all and can be led to the path of doom because they are ignorant of it? These aren't dumb grandma millies - these are the best of the best accountants and numbers guys. http://hosted.ap.org/dynamic/stories/I/IRS_COMPUTER_SECURITY?SITE=FLPET&SECTION=HOME Auditors find IRS workers prone to hackers By MARY DALRYMPLE AP Tax Writer WASHINGTON (AP) -- More than one-third of Internal Revenue Service employees and managers who were contacted by Treasury Department inspectors posing as computer technicians provided their computer login and changed their password, a government report said Wednesday. The report by the Treasury Department's inspector general for tax administration reveals a human flaw in the security system that protects taxpayer data. It also comes on the heels of accounts of thieves' breaking into computer systems of private data suppliers ChoicePoint Inc. and LexisNexis. The auditors called 100 IRS employees and managers, portraying themselves as personnel from the information technology help desk trying to correct a network problem. They asked the employees to provide their network logon name and temporarily change their password to one they suggested. 'We were able to convince 35 managers and employees to provide us their username and change their password,' the report said. That was a 50 percent improvement when compared with a similar test in 2001, when 71 employees cooperated and changed their passwords. 'With an employee's user account name and password, a hacker could gain access to that employee's access privileges,' the report said. 'Even more significant, a disgruntled employee could use the same social engineering tactics and obtain another employee's username and password,' auditors said. With some knowledge of IRS systems, such an employee could more easily get access to taxpayer data or damage the agency's computer systems. Employees gave several reasons for complying with the request, in violation with IRS rules that prohibit employees from divulging their passwords. Some said they were not aware of the hacking technique and did not suspect foul play, or they wanted to be as helpful as possible to the computer technicians. Some were having network problems at the time, so the call seemed logical. Other employees could not find the caller's name on a global IRS employee directory but gave their information anyway. Some hesitated but got approval from their managers to cooperate. Within two days after the test, the IRS issued an e-mail alert about the hacking technique and instructed employees to notify security officials if they get such calls. The agency also included warnings into its mandatory security training.

Subject: Energy and Growth
From: Terri
To: All
Date Posted: Thurs, Mar 17, 2005 at 17:52:00 (EST)
Email Address: Not Provided

Message:
Prices fluctuate, as Seinfeld learns, and so I expect we are nearing or at a top in the price of oil. But, while I expect oil prices to fall from here, I do not expect much of a fall or a lasting fall and there may reside a reason to expect a sluggish stock market. Between Federal Reserve interest rates increases and oil above 50 dollars a barrel, we may see growth ease soon.

Subject: Re: Energy and Growth
From: Pancho Villa
To: Terri
Date Posted: Thurs, Mar 17, 2005 at 19:57:03 (EST)
Email Address: nma@hotmail.com

Message:
What is energy?

Subject: What is energy?
From: Pete Weis
To: Pancho Villa
Date Posted: Fri, Mar 18, 2005 at 10:04:52 (EST)
Email Address: Not Provided

Message:
The basis for the existance of economic theory. Without energy - no economists.

Subject: Re: What is energy?
From: Emma
To: Pete Weis
Date Posted: Fri, Mar 18, 2005 at 14:23:11 (EST)
Email Address: Not Provided

Message:
Well answered.

Subject: Energy and Utility
From: Terri
To: Pancho Villa
Date Posted: Thurs, Mar 17, 2005 at 20:52:31 (EST)
Email Address: Not Provided

Message:
http://flagship2.vanguard.com/VGApp/hnw/FundsVIPERByName Interesting question. Look to the makeup of the Vanguard Energy and Utility indexes and there you have it. Unless you are after the transformation of matter to energy as Einstein would have it.

Subject: How Bush Won U.S. Presidency
From: Billy
To: All
Date Posted: Thurs, Mar 17, 2005 at 16:01:41 (EST)
Email Address: Not Provided

Message:
Published on Friday, March 11, 2005 by International Relations Center How George W. Bush Won Second-Term U.S. Presidency in 2004 Elections Run by Same Guys Who Sell Toothpaste by Noam Chomsky Presidential candidate John Kerry’s platform and program were way to the right of popular opinion on just about every issue in the 2004 U.S. elections. To the extent that anybody could even understand the program, people didn’t favor it. People who voted for Kerry are people who were concerned about the economy and about health issues. Do you think those people could tell you what Kerry’s health program was or what he was going to do for the economy? I mean, I couldn’t tell you. You have to do a research project to figure out what the program was. And it’s not that people failed to know it because they’re stupid. It’s because it was not presented as something comprehensible. Of the people who voted for candidate George Bush, the major categories were people who were concerned about terror and about national security. It’s claimed that people who were concerned about values voted for Bush, but that’s mostly a statistical artifact. When you asked the further question, “What values do you have in mind?” it turned out that the major values were things like, “I don’t like this society because it’s too materialistic,” and “There’s too much oppression.” Those are the values. Is that what Bush stands for? Getting rid of that? As far as terrorism is concerned, the administration very consciously chose actions that it was expected would increase the threat of terror and, in fact, did. It’s not because they want terror, it’s just not much of a priority for them. People who voted for Bush tended to assume that he was in favor of their views, even if the Republican Party platform was diametrically opposed to them. The same was largely true of Kerry voters. The reason for this is that the parties try to exclude the population from participation. So they don’t present issues, policies, agendas, and so on. They project imagery, and people either don’t bother or they vote for the image. The Gallup Poll regularly asks, “Why are you voting?” One of the choices is, “I’m voting for the candidate’s stand on issues.” That was 6% for Bush, and 13% for Kerry—and most of those voters were deluded about the positions of the candidates. So what you have is essentially flipping a coin. Each candidate got approximately 30% of the electorate. Bush got 31%, Kerry got 29%. The party managers know where the public stands on a whole list of issues. Their funders just don’t support them; the interests they represent don’t support them. So they project a different kind of image. If you listen to the presidential debates, you can’t figure out what they’re saying, and that’s on purpose. The last debate was supposed to be about domestic issues. The New York Times commented that Kerry didn’t make any hint about possible government involvement in health care programs because that position has, in their words, “no political support.” Well, according to the most recent polls, 80% of the population thinks that the government ought to guarantee health care for everyone, and furthermore regard it as a moral obligation. That tells you something about people’s values. But there’s “no political support.” Why? Because the pharmaceutical industry is opposed, the financial institutions are opposed, the insurance industry is opposed, so there’s “no political support.” It doesn’t matter if 80% of the population regard it as a moral obligation: That doesn’t count as political support. It tells you something about the elite conception. You’re supposed to vote for the image they’re projecting. That’s not surprising really. Just ask yourself, “Who runs the elections?” The elections are run by the same guys who sell toothpaste. They show you an image of a sports hero, or a sexy model, or a car going up a sheer cliff or something, which has nothing to do with the commodity, but it’s intended to delude you into picking this one rather than another one. Same when they run elections. But they’re assigned that task in order to marginalize the public, and furthermore, people are pretty well aware of it. For many years, election campaigns here have been run by the public relations industry and each time it’s with increasing sophistication. Quite naturally, the industry uses the same technique to sell candidates that it uses to sell toothpaste or lifestyle drugs. The point is to undermine markets by projecting imagery to delude and suppressing information—and similarly, to undermine democracy by the same method. In the year 2000, there was a huge fuss afterwards about the stolen election, with the Florida chads and the Supreme Court. But ask yourself who was exercised about it? It was all among a small group of intellectuals. They were the ones who were upset about it. There was never any public resonance for this. In the current election it’s being reiterated. There’s a big fuss among intellectuals about the vote in Ohio, how the voting machines didn’t work, and other things. But the interesting thing is that nobody cares. Why don’t people care if the election is stolen? The reason is that they don’t take the election seriously in the first place. They reacted about the way that people react to television ads. It’s a mode of delusion. If the Democrats want to succeed in that game, they’re just going to have to figure out better ways of delusion. There is an alternative, and that is to try to run a program that’s committed to developing a democratic society in which people’s opinions matter.

Subject: Rome survived Nero no?
From: johnny5
To: Billy
Date Posted: Fri, Mar 18, 2005 at 00:15:26 (EST)
Email Address: johnny5@yahoo.com

Message:
Good post Billy, chomsky has some interesting views. From a systemic level - if one stolen election is all it takes to break this country, then we are sad indeed - I think the founding fathers intended a ROBUST gubbment so that even with the lures of temptations and corruption - the general trend would be a positive one, but if one man in one office of our government can do so much damage - has our government lost its robustness? Here in Florida the legislature is trying to pass new term limits to give themselves 12 years in power instead of the 8 currently - they say 8 years is not enough time to learn politics and make a difference. Bush will be out in 4 years - is he going to blow up the world before then? How much damage did Nero do to Rome before his fall? Didn't he play his lyre while Rome burned?

Subject: It's y(our) money
From: Pancho Villa
To: All
Date Posted: Thurs, Mar 17, 2005 at 14:18:17 (EST)
Email Address: nma@hotmail.com

Message:
It's your money. Posted by John Irons at 03:10 PM So, I'm sitting here listening to the Senate's debate on PayGo, and am not happy (to say the least). The Senate's Budget resolution (as well as the president's proposal and the House) contains PayGo that applies to new spending but not taxes. From the people supporitng the one-sided PayGo, there lots's of people talking about how 1) tax cuts spur job creation and 2) how 'it's your money, and you should keep more of it' rhetoric. 1) While there are problems, the American economy is dynamic and vibrant enough that business doesn't need to beg for a tax cut a year to survive. Congress needs to realize that the economy/jobs line is wearing a bit thin. 2) It's OUR money, and WE get to decide how to spend it. If we want to spend it on education, scientific research, the national highway system, national parks, and health care for low-income Americans, that is OUR choice. The PayGo from the 90's worked. This budget is a sham, top to bottom. http://www.argmax.com/mt_blog/#

Subject: Americans Save So Little
From: Emma
To: All
Date Posted: Thurs, Mar 17, 2005 at 11:24:35 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/17/business/17scene.html?pagewanted=all&position= Americans Save So Little, but What Can Be Done to Change That? By ROBERT H. FRANK THE single-cell paramecium is about the size of the period at the end of this sentence. In many species, mature cells divide daily into two daughter cells. In schools around the world, this feature has made the paramecium a favorite vehicle for illustrating the miracle of compound interest. Left unchecked for 64 days, a single paramecium would become a colony of 9,223,400,000,000,000,000 members. Since 125 paramecia lined up shoulder-to-shoulder would span about an inch, this means a string spanning more than 1,164,600,000,000 miles - over 6,000 round trips between the Earth and sun. The story is less dramatic, of course, for growth rates much smaller than the paramecium's. Even with relatively small growth rates, however, the gains are impressive. Money invested at 7 percent interest, for example, will double every 10 years, which means that $1,000 deposited at that rate by Benjamin Franklin in the late 1700's would be worth more than $3 trillion today. The same $1,000 invested in 1945 would be worth more than $64,000. Given the miracle of compound interest, our ability to invest at even modest rates of return represents an extraordinary opportunity. Yet Americans have largely squandered it. Our savings rate, always low by international standards, has fallen sharply in recent decades. Almost a fifth of American adults have net worth of zero or less. Even more troubling, it is now common for families to pay $1,800 and more in annual interest on revolving credit card balances. Those families experience the miracle of compound interest in reverse. The savings shortfall threatens not just those who face retrenchment in retirement living standards, but also the country's economic prosperity. With little of Americans' own savings to finance domestic investment, the United States has been borrowing more than $600 billion each year from foreigners. The mushrooming foreign debt, now almost one-fourth of gross domestic product, has already weakened the dollar and threatens far more serious harm. Why do Americans save so little? Lack of self-discipline is one reason. If that were the only problem, families could solve it by simply committing a portion of each year's income growth into a payroll savings account, placing it out of temptation's reach. But the savings shortfall also stems from a second source, one less amenable to this solution. The basic idea is captured in the following thought experiment: If you were society's median earner, which option would you prefer? ¶You save enough to support a comfortable standard of living in retirement, but your children attend a school whose students score in the 20th percentile on standardized tests in reading and math; or ¶You save too little to support a comfortable standard of living in retirement, but your children attend a school whose students score in the 50th percentile on those tests. It is an unpleasant choice, to be sure, but most people say they would pick the second option. Because the concept of a 'good' school is relative, this thought experiment captures an essential element of the savings decision confronting most families. If others bid for houses in better school districts, failure to do likewise will often consign one's children to inferior schools. Yet no matter how much each family spends, half of all children must attend schools in the bottom half. The savings decision thus resembles the collective action problem inherent in a military arms race. Each nation knows that it would be better if everyone spent less on arms. Yet if others keep spending, it is too dangerous not to follow suit. Curtailing an arms race requires an enforceable agreement. Similarly, unless all families can bind themselves to save more, those who do so unilaterally risk having to send their children to inferior schools. People in other countries also face temptation and collective action problems. Why do they save more than we do? One explanation is that both problems are made worse by income disparities, which have widened much faster in this country than elsewhere. A collective agreement that each family save a portion of its income growth each year would attack both sources of the savings shortfall. Such an agreement might specify that one-third of income growth be diverted into savings until a target savings rate - say, 12 percent of income - was achieved. A family whose income did not rise in a given year would be exempt from the agreement. Such an agreement would put the magic of compound interest to work for retirement savings, a benefit that the current Social Security system completely misses. Most of the money currently taken from workers in payroll taxes gathers no interest in the decades before their retirement. Instead, it is paid directly to current retirees, who spend it on rent and food. We have a pay-as-we-go system because the program was started in the Great Depression, when there was simply no money to create a fully financed system. The good news is that Americans now have ample wealth to support such a system. Some have praised President Bush's proposal to privatize Social Security as a move that will create a fully financed program of retirement savings. It is no such thing. Under his proposal, the transition to private accounts is to be financed with borrowed money. The interest earned on private accounts would thus be offset by the interest paid on the money borrowed to create them, leaving the system right where it started. Many would object that requiring families to save a portion of each year's income growth would be an infringement of individual liberty. Yet it is the very absence of such a requirement that currently prevents most American families from saving as much as they wish to. Just as nations find it advantageous to restrict their options by signing arms reduction treaties, families may have a similar interest in limiting their freedom to engage in bidding wars for houses in top school districts. It is clear, in any event, that the failure to save entails risks of its own to freedom. America's rapidly rising debt to foreigners now threatens the economic prosperity on which so many of our cherished liberties depend. Robert H. Frank is an economist at the Johnson School of Management at Cornell University and the author, most recently, of 'What Price the Moral High Ground?'

Subject: Solow and sustainable development
From: johnny5
To: All
Date Posted: Thurs, Mar 17, 2005 at 10:05:45 (EST)
Email Address: johnny5@yahoo.com

Message:
http://www.project-syndicate.org/commentaries/commentary_text.php4?id=1874&lang=1&m=series The Lost Wealth of Nations by Partha Dasgupta The phrase “sustainable development” is commonplace, but economic commentators offer no guidance on how we are to judge whether a nation’s economic development is, indeed, sustainable. The famous Brundtland Commission Report of 1987 defined sustainable development as “... development that meets the needs of the present without compromising the ability of future generations to meet their own needs.” Sustainable development therefore requires that, relative to their populations, each generation should bequeath to its successor at least as large a productive base as it inherited. But how is a generation to judge whether it is leaving behind an adequate productive base? Economists argue that the correct measure of an economy’s productive base is wealth, which includes not only the value of manufactured assets (buildings, machinery, roads), but also “human” capital (knowledge, skills, and health), natural capital (ecosystems, minerals, and fossil fuels), and institutions (government, civil society, the rule of law). Development is sustainable so long as an economy’s wealth relative to its population is maintained over time. In other words, economic growth should be viewed as growth in wealth, not growth in GNP. There is a big difference between the two. There are many circumstances in which a nation’s GNP (per capita) increases even while its wealth (per capita) declines. In broad terms, these circumstances involve growing markets in certain classes of goods and services (natural-resource intensive products), concomitant with absent markets and collective policies for natural capital (ecosystem services). As global environmental problems frequently create additional stresses on the local resource bases of the world’s poorest people, GNP growth in rich countries can fuel downward pressure on the wealth of the poor. Of course, a situation where GNP increases while wealth declines can’t last forever. When an economy eats into its productive base in order to raise current production, eventually GNP will decline, too, unless policies were to so change that wealth begins to accumulate. For example, using World Bank data on the depreciation of a number of natural resources at the national level, economists estimate that, although GNP per capita has increased in the Indian sub-continent over the past three decades, wealth per capita has declined somewhat. The decline has occurred because, relative to population growth, fixed-capital investment, knowledge and skills, and improvements in institutions have not compensated for the degradation of natural capital. In sub-Saharan Africa, both GNP per capita and wealth per capita have declined. Economists have also found that in the world’s poorest regions (Africa and the Indian sub-continent), areas that have experienced higher population growth have also lost wealth per capita at a faster rate. The economies of China and the OECD countries, by contrast, have grown both in terms of GNP per capita and wealth per capita. The latter regions have more than substituted for the decline in natural capital by accumulating other capital assets. In other words, during the past three decades the rich world seems to have enjoyed “sustainable development,” while development in the poor world (barring China) has been unsustainable. These are early days in the quantitative study of sustainable development. Even so, one can argue that current estimates of wealth are biased. As for natural capital, the World Bank has so far limited itself to the atmosphere as a sink for carbon dioxide, oil, and natural gas, and forests as sources of timber. Many types of natural capital, however, have not been included: fresh water, soil, forests as providers of ecosystem services, and the atmosphere as a sink for such pollution as particulates and nitrogen and sulphur oxides. If these missing items were included, the poor world’s economic performance over the past three decades, including China’s, would look far worse. But the estimates of wealth accumulation in recent years in the rich world are biased upward too. Empirical studies by earth scientists have revealed all too often that the capacity of natural systems to absorb disturbances is not unlimited. When their absorptive capacities are reached, natural systems are liable to collapse into unproductive states. Recovery is then costly, in terms of both time and material resources. On the other hand, if, say, the Atlantic current that keeps northern Europe warm were to shift direction or to slow down on account of global warming, the change would be essentially irreversible. In short, we know that up to some unknown set of limits, knowledge, institutions, and manufactured capital can substitute for natural resources, so that even if an economy loses some of its natural capital, in quantity or quality, its wealth would increase if it invested sufficiently in other assets. The remarkable increase in agricultural productivity over the past two centuries demonstrates this clearly. But there are limits to substitutability: the costs of substitution (including human ingenuity) often increase in previously unknown ways as key resources are degraded. Global warming is a case in point. When the downside risks associated with such limits and thresholds are brought into estimates of sustainable development, the growth in wealth among the world’s wealthy nations will probably turn out to have been less than we now think. Sir Partha Dasgupta is Professor of Economics at the University of Cambridge and Fellow of St. John’s College, Cambridge. His most recent book is Human Well-Being and the Natural Environment. His E-mail address is Partha.Dasgupta@econ.cam.ac.uk

Subject: Thank You
From: Terri
To: johnny5
Date Posted: Thurs, Mar 17, 2005 at 11:08:33 (EST)
Email Address: Not Provided

Message:
Thoughtful and provokative essays. There is much to consider here. Thank you so much.

Subject: Loss of wealth of nations
From: johnny5
To: johnny5
Date Posted: Thurs, Mar 17, 2005 at 10:12:28 (EST)
Email Address: johnny5@yahoo.com

Message:
Ok so one part of wealth is our hard assets: We fail that one with an aging infrastructre needing massive repair: http://www.fox5ny.com/_ezpost/data/13237.shtml Nation Has Aging Infrastructure (03.09.05- AP) — Crowded schools, traffic-choked roads and transit cutbacks are eroding the quality of American life, according to an analysis by civil engineers that gave the nation's infrastructure an overall grade of D. A report by the American Society of Civil Engineers released Wednesday assessed the four-year trend in the condition of 12 categories of infrastructure, including roadways, bridges, drinking water systems, public parks, railroads and the power grid. The overall grade slipped from the D-plus given to the infrastructure in 2001 and 2003. 'Americans are spending more time stuck in traffic and less time at home with their families,' William Henry, the group's president, said in a statement. The report said $1.6 trillion should be spent over the next five years to alleviate potential problems with the nation's infrastructure. Transportation alone requires $94 billion in annual spending, the report said. The House is to begin debate Wednesday on a six-year, $284 billion highway and mass transit bill, which stalled last year in a money dispute between the White House and Congress. The report concluded that airports will face the challenge of accommodating more regional jets and super-jumbo jets. Grade: D-plus. It's uncertain, the report said, whether schools can handle growing enrollment and smaller class sizes required by the No Child Left Behind Act. Grade: D. The report also noted that many transit systems are borrowing money to maintain operations as they're raising fees and cutting back service. Grade: D-plus. Well next for wealth is human capital, our collective society is getting older, sicker, futureshock and alvin toffler is getting too much for them, tech is getting beyond many, we are cutting NASA and science education and american is falling behind. So we fail that one. Next is natural capital - www.321energy.com for all the negatives on that and our foreign dependence - so we fail that one. Institutional capital is left - well with all the crooks in finance and gubbment - I wager we fail that one too - so if you got 4 f's on your report card of wealth - what do you do solow?

Subject: Leverage in TSY 50:1
From: johnny5
To: All
Date Posted: Thurs, Mar 17, 2005 at 10:00:54 (EST)
Email Address: johnny5@yahoo.com

Message:
http://www.pimco.com/LeftNav/Late Breaking Commentary/FF/2004/FF0604.htm 'Stay with me here, cause I m going to break some new ground! Right now, the Fed requires 102% over-collateralization for lending liquidity via its open market desk. The price for borrowing from the Fed (indirectly via the open market desk, in contrast to directly via the discount window) is the Repo rate, which is the Siamese twin of the Fed funds rate. Thus, a levered investor can hold Treasuries with only 2% equity capital: the amount of collateralization that is required. Put differently, you can lever Treasuries 50 to 1! '

Subject: inflation & social disparity our future
From: johnny5
To: All
Date Posted: Thurs, Mar 17, 2005 at 09:38:58 (EST)
Email Address: johnny5@yahoo.com

Message:
So we can expect high inflation and wider gaps between have and have nots? http://www.project-syndicate.org/commentaries/commentary_text.php4?id=1875&lang=1&m=series .....Like the radicals, the neo-Keynesians did not engage their challengers with empirical testing. The efficacy of high demand was a matter of faith. Yet events in the 1970’s put that faith to a cruel test. When supply shocks hit the US economy, the neo-Keynesians’ response was to pour on more demand, believing it would revive employment. There was little recovery – only faster inflation. ....We must proceed cautiously, however. In standard analyses, the tax cut brings a reduction in government purchases of goods and services, like defense. But a tax cut could instead contract the welfare state – social assistance and social insurance, which constitute social wealth. In that case, the tax cut, while gradually increasing private wealth, would decrease social wealth. The issue is an empirical one.

Subject: Looking Ahead
From: Terri
To: All
Date Posted: Thurs, Mar 17, 2005 at 07:26:11 (EST)
Email Address: Not Provided

Message:
What is always necessary is to look to the coming 5 years and think where the earning can be. Then we have to look to where current values are reasonable. Of course, with total market stock and bond indexes we can always simply save steadily in a balance that seems suitable and trust to the future.

Subject: Re: Looking Ahead
From: johnny5
To: Terri
Date Posted: Thurs, Mar 17, 2005 at 09:13:06 (EST)
Email Address: johnny5@yahoo.com

Message:
Ok I got my moms AARP scudder IRA rolled over to vangaurd this week, has about 10K in the account - put it into international value fund because I expect a dollar drop wanted strictly international bonds but I didn't see any thing on their funds like that - am I missing something? but that 30% volatility is beginning to concern me now that I am buzzing a bit (hiccup). Now am going to buy her a 3.5K IRA to get her some tax savings - was thinking about that GNMA fund - am I correct in believing that if interests rates go up - this fund will always pay better or do I have it reversed? Falling dollar and rising rates - my bets for the next 5 years.

Subject: From the mouth of the great man himself!
From: Setanta
To: All
Date Posted: Thurs, Mar 17, 2005 at 07:19:39 (EST)
Email Address: Not Provided

Message:
We know there was a real Patrick because he left us a record, his Confession, written in Latin near the end of his life. It is a fascinating insight into Patrick, the man. Here are some key extracts: Patrick introduces himself and tells how he was kidnapped at the age of 16… 'I, Patrick, a sinner, a most simple countryman, the least of all the faithful and most contemptible to many, had for father the deacon Calpurnius, son of the late Potitus, a priest, of the settlement of Bannavem Taburniae; he had a small villa nearby where I was taken captive. I was at that time about 16 years of age. I did not, indeed, know the true God; and I was taken into captivity in Ireland with many thousands of people, according to our deserts, for quite drawn away from God, we did not keep his precepts, nor were we obedient to our priests who used to remind us of our salvation. And the Lord brought down on us the fury of his being and scattered us among many nations, even to the ends of the earth, where I, in my smallness, am now to be found among foreigners.' On his embarrassment about his lack of education… 'And therefore for some time I have thought of writing, but I have hesitated until now, for truly, I feared to expose myself to the criticism of men, because I have not studied like others, who have assimilated both Law and the Holy Scriptures equally and have never changed their idiom since their infancy, but instead were always learning it increasingly, to perfection, while my idiom and language have been translated into a foreign tongue. So it is easy to prove from a sample of my writing, my ability in rhetoric and the extent of my preparation and knowledge, for as it is said, 'wisdom shall be recognised in speech, and in understanding, and in knowledge and in the learning of truth.'' On finding God while herding… 'But after I reached Ireland I used to pasture the flock each day and I used to pray many times a day. More and more did the love of God, and my fear of him and faith increase, and my spirit was moved so that in a day (I said) from one up to 100 prayers, and in the night a like number; besides I used to stay out in the forests and on the mountain and I would wake up before daylight to pray in the snow, in icy coldness, in rain, and I used to feel neither ill nor any slothfulness, because, as I now see, the Spirit was burning in me at that time.' Guided by a voice, he escapes…. 'And it was there of course that one night in my sleep I heard a voice saying to me: 'You do well to fast: soon you will depart for your home country.' And again, a very short time later, there was a voice prophesying: 'Behold, your ship is ready.' And it was not close by, but, as it happened, 200 miles away, where I had never been nor knew any person. And shortly thereafter I turned about and fled from the man with whom I had been for six years, and I came, by the power of God who directed my route to advantage (and I was afraid of nothing), until I reached that ship.' Called back to Ireland by a dream… 'And after a few years I was again in Britain with my kinsfolk, and they welcomed me as a son, and asked me, in faith, that after the great tribulations I had endured I should not go anywhere else away from them. And, of course, there, in a vision of the night, I saw a man whose name was Victoricus coming as if from Ireland with innumerable letters, and he gave me one of them, and I read the beginning of the letter: 'The Voice of the Irish', and as I was reading the beginning of the letter I seemed at that moment to hear the voice of those who were beside the forest of Foclut which is near the western sea, and the were crying as if with one voice: 'We beg you, holy youth, that you shall come and shall walk again among us.' And I was stung intensely in my heart so that I could read no more, and thus I awoke. Thanks be to God, because after so many years the Lord bestowed on them according to their cry.' Haunted by a youthful confession… 'They brought up against me after 30 years an occurrence I had confessed before becoming a deacon. On account of the anxiety in my sorrowful mind, I laid before my close friend what I had perpetrated on a day, nay, rather in one hour, in my boyhood because I was not yet proof against sin. God knows, I do not, whether I was 15 years old at the time, and I did not then believe in the living God, nor had I believed, since my infancy; but I remained in death and unbelief until I was severely rebuked, and in truth I was humbled every day by hunger and nakedness.' The faith he brought to the Irish… 'So, how is it that in Ireland, where they never had any knowledge of God but, always, until now, cherished idols and unclean things, they are lately become a people of the Lord, and are called children of God; the sons of. the Irish and the daughters of the chieftains are to be seen as monks and virgins of Christ.' Baptising a beautiful noblewoman… 'And there was, besides, a most beautiful, blessed, native-born noble Irish woman of adult age whom I baptised; and a few days later she had reason to come to us to intimate that she had received a prophecy from a divine messenger who advised her that she should become a virgin of Christ and she would draw nearer to God. Thanks be to God, six days from then, opportunely and most eagerly, she took the course that all virgins of God take, not with their fathers' consent but enduring the persecutions and deceitful hindrances of their parents. Notwithstanding that, their number increases, (we do not know the number of them that are so reborn) besides the widows, and those who practise self-denial. Those who are kept in slavery suffer the most. They endure terrors and constant threats, but the Lord has given grace to many of his handmaidens, for even though they are forbidden to do so, still they resolutely follow his example.' 'My confession…' 'But I entreat those who believe in and fear God, whoever deigns to examine or receive this document composed by the obviously unlearned sinner Patrick in Ireland, that nobody shall ever ascribe to my ignorance any trivial thing that I achieved or may have expounded that was pleasing to God, but accept and truly believe that it would have been the gift of God. And this is my confession before I die.'

Subject: Re: From the mouth of the great man himself!
From: Terri
To: Setanta
Date Posted: Thurs, Mar 17, 2005 at 08:52:02 (EST)
Email Address: Not Provided

Message:
To the great man, himself :)

Subject: Re: From the mouth of the great man himself!
From: johnny5
To: Terri
Date Posted: Thurs, Mar 17, 2005 at 09:07:40 (EST)
Email Address: johnny5@yahoo.com

Message:
What in interesting history - thanks - Cheers! (hiccup)

Subject: Peace Always
From: Emma
To: johnny5
Date Posted: Thurs, Mar 17, 2005 at 10:06:16 (EST)
Email Address: Not Provided

Message:
Peace always in Ireland. May there be peace from here on.

Subject: Re: Peace Always
From: Pancho Villa
To: Emma
Date Posted: Thurs, Mar 17, 2005 at 11:54:06 (EST)
Email Address: nma@hotmail.com

Message:
Voltaire: What is tolerance? -- it is the consequence of humanity. We are all formed of frailty and error; let us pardon reciprocally each other's folly -- that is the first law of nature.

Subject: Bluff your way in Irish!
From: Setanta
To: All
Date Posted: Thurs, Mar 17, 2005 at 07:13:03 (EST)
Email Address: Not Provided

Message:
now you can go out and celebrate St Patricks Day and impress all your friends! If you're Irish through and through or a wannabe Irish citizen, there's no doubt that you'll be in a pub at some stage on March 17th. So, we have compiled a list of essential Irish phrases that you'll be saying when you're out and about. Use this as helpful chat up lines, to get someone to buy you a pint or simply to converse with friends or strangers on the night. Even if you're not up to speed with the Irish language, we've added the easy pronunciation guide so you can completely bluff your friends!! Colour guide: Irish translation [how it's pronounced] Happy St Patrick's Day Beannachtaí na Féile Pádraig duit [Ban ack tee na fayla Pawd-rig ditch] -by the way Jonny, the reason this is diffent to my greeting earlier is that my greeting was in Connacht Irish and this is Ulster Irish! Kiss me, I'm Irish! Is Éireannach mé, ‘dom póg! [Is Air- an- ack may, do pogue] I'm Irish, are you? Is Éireannach mé, carb as duit féin? [Is air-an- ack may, carr-ab ass ditch hane?] The night is still young! Níl an oíche ach ina tachran! [Knee-ill an ee-ha ack inna tach-rann] Will you come back for a night cap!? Beidh deoch deireannach agat sula dtéann tú a luí? [Bay juchk jer-ann-ach agat sulla jay-ann too a lee] Sure you'll have one for the road! Ná himigh go n-ólaimid deoch an dorais! [Na himie gu knowl-am-widge juchk an dor-ish] Irish eyes are smiling Is minic aoibh a ghaire ar Éireannaigh [Isss min-ic eave a guy-ra air Air-an-ee] Mine's a pint Beidh pionta agamsa le do thoil! [Bay pin-ta agam- sa le do hill] Do you have Irish roots? An bhfuil duine ar bith muinteartha duit atá ina Éireannach? [An will din- ye ar bee mwin-char-tha ditch ata ina Air-ean-ach] How are you doin'?! Cad é mar atá tú? [Cad jay mar ata too?] Do you come here often? An dtig tú anseo go minic? [An jig too an-shaw gu minn-ic?] Get your coat, you've pulled! Imigh is faigh do chóta gasta, bhréag tú mé [Im-ee iss fwy do hoe-ta gasta , vreg too may!] Did I tell you that I'm Bono's cousin! An bhfuil a fhios agat gur colcheathrar dom é Bono? [An will iss agat gur cul- hee-ath-rar do ay Bono?] It's your round! Tá babhta deochanna agat orainn! [Ta bow-ta juchk-anna agat oreene ] It can't be my round, I'm Scottish! Tá dul amú ort, is Albanach mé! [Ta dul amoo ort, iss Alab-anac may!]

Subject: Too drunk to learn
From: johnny5
To: Setanta
Date Posted: Thurs, Mar 17, 2005 at 09:02:49 (EST)
Email Address: johnny5@yahoo.com

Message:
(Hiccup) too much beer, I will try to remember one of them though, hehe - isn't that gaelic what enya and clannad sing in? It can't be my round, I'm Scottish! BWAHAHA! This will be the one I learn as my last name is wallace and that counts for something in this little town of dunedin florida. The parade is going to be rained out though, lots of raindrops falling on my head.

Subject: Re: Bluff your way in Irish!
From: Terri
To: Setanta
Date Posted: Thurs, Mar 17, 2005 at 07:18:04 (EST)
Email Address: Not Provided

Message:
Suppose you do not care to drink :)

Subject: Non alcoholic beer for the good
From: johnny5
To: Terri
Date Posted: Thurs, Mar 17, 2005 at 09:04:18 (EST)
Email Address: johnny5@yahoo.com

Message:
But hard heavy corned beef and cabbage and strong irish whiskey for the bad - hehe (hiccup)

Subject: Re: Bluff your way in Irish!
From: Setanta
To: Terri
Date Posted: Thurs, Mar 17, 2005 at 07:42:03 (EST)
Email Address: Not Provided

Message:
The words should work just as well with soft drinks; instead of 'pint' substitute with 'gloine bainne/coke/uisce/soda' which translates to 'glass of milk/coke/water/soda' pronounced 'glin-na bonya/coke/ish-ka/soda' for those who do want a drink today here's an Irishman's tip - never drink a green drink, especially today...a pint of plain (Guinness) is your only man!

Subject: Re: Bluff your way in Irish!
From: Terri
To: Setanta
Date Posted: Thurs, Mar 17, 2005 at 08:51:05 (EST)
Email Address: Not Provided

Message:
You are wonderful. Love to Irish everywhere.

Subject: We Can be Optimistic
From: Terri
To: All
Date Posted: Thurs, Mar 17, 2005 at 06:27:30 (EST)
Email Address: Not Provided

Message:
What is interesting about looking at fine returns in a most difficult investment period is that it shows what diversity can mean. Of course the pattern will change in the coming 5 years. The past will not repeat, but there is reason to be optimistic with diversity and patience and understanding institutions that can and should be trusted. The most pessimistic investor should be joyful about bond funds these last 5 years. Yes, joyful.

Subject: Selected Vanguard Returns
From: Terri
To: All
Date Posted: Thurs, Mar 17, 2005 at 06:12:38 (EST)
Email Address: Not Provided

Message:
Vanguard REIT Index is up 148.23% over the 5 years through February 28, 2005. Comparison of REIT Index performance to real estate is valid. Vanguard Energy Fund is up 192.26%. Health Care is up 72.76%. Long Term Bond Index is up 61.98%. Nice. There is always reason to be optimistic with thought and diversity and fine conservative investment funds to rely on.

Subject: Happy st pats day everyone
From: johnny5
To: All
Date Posted: Thurs, Mar 17, 2005 at 03:20:17 (EST)
Email Address: johnny5@yahoo.com

Message:
May the luck of the irish shine on your investments all my pkarchive friends, I am still chasing that leprechaun with a pot of gold! Johnny will drink a green beer for you all. Cheers! (hiccup)

Subject: Re: Happy st pats day everyone
From: Setanta
To: johnny5
Date Posted: Thurs, Mar 17, 2005 at 07:02:12 (EST)
Email Address: Not Provided

Message:
La le feile Padraig agatsa freisin, Johnny5... Thats 'Happy St Patrick's Day to you too' in Irish Gaelic! Unfortunately, i'm not out enjoying myself (today being a public holiday in Ireland). I'm stuck in work because some damned Pension Scheme wants signed financial statements by next week! By the way, its a beautiful Spring day here, and in about 2 hours I'm going outside to enjoy the parade! its not going to be too much of a booze fest (personally, i haven't had more than 20 pints of beer in total since christmas), since all Off-Licenses (Irish equivalent of liquor stores) are closed and it's illegal to carry an open alcoholic drink in public. also, there's work tomorrow so all drinking was done last night! Well, have a good day and beware of the Sinn Fein/IRA bogeymen.

Subject: Re: Happy st pats day everyone
From: Terri
To: Setanta
Date Posted: Thurs, Mar 17, 2005 at 07:15:29 (EST)
Email Address: Not Provided

Message:
Happy peaceful day to all.

Subject: Real Estate Blog Pete - 87.6% in 5 yrs
From: johnny5
To: All
Date Posted: Thurs, Mar 17, 2005 at 02:39:37 (EST)
Email Address: johnny5@yahoo.com

Message:
This was just rated the number 1 real estate blog on the net Pete: http://insiderealestatejournal.blogspot.com/ He is based in my area - Tampa. He writes this down into his blog: The Florida Association of Realtors issued this news release telling us all about sales for Florida homes being up 10 percent in January, along with the median sale price of Florida homes. Statewide, sales of single-family existing homes totaled 15,567 last month compared to 14,204 homes sold a year ago... The statewide median sales price last month rose 24 percent to $204,900; a year ago, it was $164,900. In January 2000, the statewide median sales price for single-family homes was $109,200, resulting in an increase of 87.6 percent over the five-year-period, according to FAR records. Now Pete this is almost EXACTLY what has happened with my mothers house in west palm, unbelievable returns with similar pricing as their report - so my thoughts that she was in a bubble market compared to other areas of florida may be wrong. She doesn't live there though, she rents it out, and we are trying to find out about doing a 1031 exchange so she can get a house here so she can have it close by and look over it. So the past few weeks we have been riding around the neighborhoods of the tampa bay area and we see all these new developments with stucco homes - I thought that stucco stuff was bad in humid florida because of Mold growing on the inside destroying it? And lots of the new homes have brown patches on the sides where water sprinklers have wetted them with what my mom calls dirty copper water that is very unhealthy for you. We asked some of the realtors these 2 questions and never got a straight answer. Also insurers are raising rates in the state. This web guy is hype master number one if you ask me though, he counters every negative real estate article on the web and press and issues these always glowing reports - he is hyping trump tower big time. I don't understand why trump has decided to come to this coast versus another. But here: http://thehomeblog.blogs.com/thb/taxes/index.html This guy talks about the hidden agenda: Over at Realty Times Blanche Evens posits that the White House will be looking at the perceived profits being made in the housing market for some backdoor taxes to implement. Reducing or removing the mortgage interest tax exemption would do just that. Combine that with an increase in home ownership and you have a new tax base. Easy as pie. http://www.showcaseofhomes.tv/ So you go here and watch thier little 5 minute webcast show and she talks about greenspan and housing bubbles and not to worry because greenspan was praising our housing market and I can't understand how she can take such a positive view of what he said when I took a negative view - don't they know anything easy greenspan says negatively has to be multiplied by 10? I am going to look at the realytimes market conditions reports for a few areas and see what they say about bubbles and if they were rosy glasses too. To futher sour things - what did vanguard funds do the past 5 years versus real estate in FL - not as good I bet and now after these huge runups I hear some people wanting to get into real estate at this pricing peak and get out of vanguard.

Subject: More on the KL hedge fund cowboys
From: johnny5
To: All
Date Posted: Wed, Mar 16, 2005 at 22:50:45 (EST)
Email Address: johnny5@yahoo.com

Message:
Again I don't know that these guys were really evil by shorting goog at 180 - sounds safe and logical to me - but it reveals the flaw of our markets and hedge funds and leverage and why there is so much danger out there - even if you are right - you risk a lot of people's money not understanding the markets can remain irrational longer than you can remain solvent. Even Pete said he was giving up on the bear because of this mass psychology of delusion. http://www.palmbeachpost.com/business/content/business/epaper/2005/03/15/a1d_hedge_0315.html Principal of KL Financial investment firm apparently has fled country By David Sedore Palm Beach Post Staff Writer Tuesday, March 15, 2005 A West Palm Beach money manager under investigation for fraud fled the country last month for South Korea one day after being interviewed by the Securities and Exchange Commission. Won S. Lee, one of three principals of hedge fund firm KL Financial Group, apparently hopped aboard a Korean Air flight to Seoul on Feb. 23 with a one-way ticket in hand. 'He's gone forever,' said Gary Klein, a Boca Raton attorney who represents more than 30 investors who lost more than $30 million invested with the firm that operated from Esperante office building downtown before abruptly closing Feb. 25. 'The question is did he go with the money or without?' Earlier this month, the SEC sued KL Financial in federal court, calling it a 'massive hedge fund fraud.' The agency also sued Lee, a former resident of Riviera Beach, and brothers Yung Kim and John Kim, all principals in the firm. John Kim is a Jupiter resident. A federal judge has ordered the temporary freeze of the remaining assets of KL Financial and its principals. At least $81 million, perhaps as much $300 million, is gone as a result of the collapse of the firm that specialized in high-risk hedge fund investing. Lee's flight, paid for by cashing in frequent flier miles, came a day after SEC examiners visited the Irvine, Calif., offices of Shoreland Trading, a brokerage that Lee and the Kims controlled and that handled securities trading for KL Financial's various investment funds. On Feb. 22, the SEC examiners interviewed Lee and Yung Kim in Irvine about Shoreland's operations. The Shoreland brokerage, according to audits, showed huge trading losses — $16 million in 2003 and $46 million in 2004 — at the same time that KL Financial was telling its investors that it was making huge profits. Lee and Yung Kim told the SEC that Shoreland hired young, inexperienced traders and that the money they were trading was Lee's. Shoreland, they said, had no retail customers. The two men agreed to meet again with the SEC the next day. Yung Kim showed; Lee did not. The SEC was told that Lee was on a plane to Florida, and the examiners agreed to continue the interview that Feb. 25 in West Palm Beach, where KL Financial and Shoreland shared the 17th-floor of the Esperante building. Lee and Yung Kim didn't show. 'Won Lee on the 22nd, Yung Kim on the 23rd. That's the last anybody has heard from either of them,' said Ivan Harris, a staff attorney with the SEC in Miami. The FBI and the U.S. Attorney's office in Miami also are investigating the firm and its principals, though no charges have been filed. FBI spokesman Judy Orhuela would not comment Monday. John Kim, the other principal, remains in Jupiter. According to court documents, on Feb. 26, the day after the SEC shut down the West Palm Beach office, Kim told investors that Lee controlled everything and was responsible for the trading losses. He also said Lee had fled the country. John Kim also asked investors for more money, promising he would make back lost money. KL Financial raised $10.1 million in January and February. On Feb. 5, less than three weeks before its collapse, the firm had asked SEC for permission to raise $2 billion from investors. Gordon Gekko: Ever wonder why fund managers can't beat the S&P 500? 'Cause they're sheep, and sheep get slaughtered.

Subject: He is sorry your money got stolen
From: johnny5
To: All
Date Posted: Wed, Mar 16, 2005 at 22:34:37 (EST)
Email Address: johnny5@yahoo.com

Message:
The end of the article is the problem, they say they use the SS to make sure they are dealing with the right individual, well many of my friends SS was stolen and the banks used a faulty measure to determine who they are dealing with - can't they see their own foolishness in putting so much weight on a number? My friends that are bankrupt now because of identity theft deserved better than this. http://www.palmbeachpost.com/business/content/business/epaper/2005/03/16/a1d_idtheft_0316.html Data broker's CEO says he's sorry about security breach By Rebecca Carr and Marilyn Geewax Palm Beach Post-Cox News Service Wednesday, March 16, 2005 WASHINGTON — ChoicePoint Inc.'s chief executive apologized Tuesday for the data broker's slow response to last year's theft of about 145,000 customers' private information. But amid sharp questioning from members of both parties in one committee in the House and another in the Senate, officials of the Alpharetta, Ga., company resisted suggestions that new laws being prepared on identity theft include strong restrictions on the sale of Social Security numbers. 'Let me begin by offering an apology on behalf of our company and my own personal apology to those consumers whose information may have been accessed,' Chairman and CEO Derek Smith told the House Energy and Commerce Committee's panel on trade and consumer protection. He said ChoicePoint is notifying the individuals about the security breach and moving 'aggressively' to prevent it from happening again. 'The security breach that ChoicePoint discovered last fall in California has caused us to go through some serious soul-searching at ChoicePoint,' Smith said. 'In retrospect, the company should have acted more quickly. I should have been notified earlier of the investigation.' ChoicePoint and other data brokers are under fire on Capitol Hill for a string of recent security breaches, including an incident involving Boca Raton-based Seisint Inc., a division of LexisNexis, that compromised information on 30,000 individuals. Tuesday marked the first time Smith has testified before Congress since ChoicePoint's huge information loss became public last month. Smith said that in the future he would be informed of all criminal investigations beginning with the initial inquiry. Smith has said he did not learn of the security lapse until January, more than three months after it was first detected. The company plans to review its files for other acts of fraud or theft, Smith said. In a recent filing with the Securities and Exchange Commission, ChoicePoint reported that it is 'aware of a limited number of past instances that resulted in criminal convictions of certain former customers for activities involving improper use of our information products.' Lawmakers from both political parties are considering new legislation to regulate data brokers on two fronts: restricting Social Security numbers from public sale and requiring companies to inform consumers when intruders acquire personal information. 'I personally see no socially redeeming value in anyone having the right to market or use Social Security numbers and other personal information,' said Rep. Joe Barton, R-Texas, chairman of the House Energy and Commerce Committee. He predicted that Congress would pass a law restricting the sale of Social Security numbers except in limited cases, such as a criminal investigation. Smith and Kurt Sanford, chief executive officer of LexisNexis, supported proposals to strengthen federal laws protecting consumer privacy. But both resisted the idea of banning the sale of Social Security numbers. 'I would not support a blanket ban on the sale of Social Security numbers,' Sanford said. 'Financial institutions need unique identifying Social Security number information when they are investigating fraud and making sure they are doing business with the right individuals.'

Subject: ID theft victims cry to congress
From: johnny5
To: johnny5
Date Posted: Wed, Mar 16, 2005 at 22:39:18 (EST)
Email Address: johnny5@yahoo.com

Message:
This bill is not going to stop the hungry hackers in russia - laws and legislation are not the problem, the problem is the systemic risk inherint in having digital dollars floating in the virtual world. http://www.palmbeachpost.com/business/content/business/epaper/2005/03/15/a1d_idtheft_0315.html Identity theft victims tell Sen. Nelson their stories By Stephen Pounds Palm Beach Post Staff Writer Tuesday, March 15, 2005 BOCA RATON — Last year Raquel Lopez was turned down for bank loan, and it wasn't because her own credit was bad. The 31-year-old teacher from Tamarac called the nation's three credit bureaus and found that for two years someone in Wichita, Kan., was running up debt in her name. After contesting the debt, she thought she had cleared her name. ID theft information Watch video of interviews with victims, prevention tips.
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-- Highlights of U.S. Sen. Bill Nelson's bill against identity theft: • Places data brokers under the regulation of the Federal Trade Commission. • Gives individuals the right to see all personal information held on them and to correct wrong data. • Tracks who is requesting and receiving consumer information from data brokers. • Requires procedures to detect and prevent fraud. Then her problems with the IRS began. The agency said she hadn't filed W-2 forms for jobs in 2003 — jobs she never held. Today, she still owes $5,700 in IRS penalties and fees, Lopez said Monday. 'It's frustrating. You want it over with,' she told Sen. Bill Nelson, D-Fla., who came to Boca Raton to gain support for his bill in Washington to help thwart identity theft. 'You have no idea how much trouble you go through. And you have to do all the work yourself.' Lopez is one of nine to 10 million people a year who are victims of identity theft. She and a handful of other victims told Nelson how their lives were disrupted when their name, birth date, Social Security number and other personal information were pilfered by thieves. Nelson is championing the new congressional fight against identity theft. He has introduced legislation that would place data brokers such ChoicePoint and Seisint — both with computer operations in Boca Raton — under the regulation of the Federal Trade Commission. 'Increasingly, we have a problem with identity theft... and if we don't do something about it, if we don't get our arms around identity theft... none of us in America will have any privacy anymore,' Nelson said. The two companies are responsible for the personal information leaks affecting 175,000 Americans — more than 11,500 Floridians — in the past month. In those cases, computer security was breached by thieves using customers' login names and passwords, although in ChoicePoint's case the high-tech thieves stole personal information first to create bogus customer accounts. ChoicePoint and LexisNexis, the parent of Seisint, are notifying victims. Seisint's letters to victims went out in the mail Monday. Nelson has extra motivation to take action because his personal information was jeopardized in December when the Bank of America lost computer tapes with the account numbers and other information on 1.2 million customers. 'There ought to be responsibility by the Bank of America not to ever let those records get lost or stolen in the first place... and that's where we need to crack the whip,' Nelson said. While Nelson's bill would give the FTC authority over information brokers and require them to track requests for personal data, it wouldn't resolve the vast majority of identify-theft cases where someone's credit card number is stolen from a receipt found in a waste basket. 'If this passes, schemers wouldn't be able to sign up and get this information just by paying a fee,' Nelson aide Christine Hanson said. Two years ago, Nelson pushed for legislation that would require businesses to shred credit card data when disposing of it, after a Naples branch of CitiFinancial simply tossed more than a thousand customer records in a trash bin. Nelson's latest bill has been referred to the Senate Commerce Committee for hearings; a companion bill is in the House. Nelson also has asked for a General Accounting Office investigation into the possible national-security risk from the release of sensitive personal information by data brokers.

Subject: Vanguard Indexes
From: Terri
To: All
Date Posted: Wed, Mar 16, 2005 at 21:42:20 (EST)
Email Address: Not Provided

Message:
Morgan Stanley has superior indexes, and there is absolutely no connection to any possible ethics issue in the forming of these indexes. Vanguard has done precisely what is proper for investors in adopting these indexes. The change began several years ago and continues.

Subject: Vanguard MSCI Indexes
From: Terri
To: Terri
Date Posted: Wed, Mar 16, 2005 at 21:48:12 (EST)
Email Address: Not Provided

Message:
The reason to use Morgan Stanley indexes is simply that they are the finest market capitalization indexes. Taking them as a model is a perfect choice for investors.

Subject: My trust is hard to earn
From: johnny5
To: Terri
Date Posted: Wed, Mar 16, 2005 at 22:16:38 (EST)
Email Address: johnny5@yahoo.com

Message:
Terri after reading all over the place how MSDW and so many others are doing all these very very crooked things that distort the markets it gives me a grand picture of thier corporate culture - to screw me and you and make them and their rich buddies lots of money. Now given that, you are telling me that even though they are screwing the little guy in so many other parts of thier business, and that reflects a corporate ethics problem of where they manipulate things and distort the EMH with tricks - none of that EVIL will bleed over into other parts of their business like say the MSCI. I can't feel so secure as you given my huge distrust of wealthy people, crooks, lies, and cheats, that came from an educational and societal background where they have proven time and time again all they learned was to screw me and you ANY WAY they can. But you are absolutely confident that if evil people wanting to hurt the little guy for their own gain got control of MSDW and the MSCI weightings and a host of other statistic funny business and accounting tricks or whatever they would not use their power to manipulate things to their advantage but stay honest? Lets play devils advocate - lets take a paranoid view of the world, what TRICKS could be done with this MSCI that vangaurd has signed onto that would hurt the little guy at the benefit of richie?

Subject: China's Economic Numbers
From: Emma
To: All
Date Posted: Wed, Mar 16, 2005 at 21:35:11 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/16/business/16cnd-yuan.html?adxnnl=1&adxnnlx=1111008101-v/KcFQcI8Gdvqihxl9Zocw China Raises Home-Loan Rate in Bid to Slow Soaring Growth By KEITH BRADSHER HONG KONG - China's central bank announced late today that it was raising the cost of housing loans, after more signs emerged that the country's economy may be growing at an unsustainable pace as property prices soar. The minimum regulated interest rate for housing loans of five years or more will rise to 5.51 percent, from 5.31 percent. Banks will also be encouraged to require down payments of 30 percent of the purchase price, instead of 20 percent, in cities that have seen especially rapid appreciation lately, the People's Bank of China said. The moves come a week after Shanghai began assessing a capital gains tax of 5.6 percent on real estate bought and sold in less than a year, and after delegates to the National People's Congress in Beijing voiced worries in the past week that real estate speculation was becoming out of control and hurting the affordability of housing. Real estate prices have been climbing faster in China than in much of the United States, with urban prices escalating 10.8 percent in the fourth quarter after a jump of 8.6 percent in the third quarter. Prices have been rising even faster in Shanghai, where overseas investors have been buying up apartments in hopes of profiting from not only from rising prices but also a possible increase in the value of China's currency against the dollar. The Chinese central bank tempered the effects of the housing loan rate increase on the overall economy, however, by reducing the interest rate it pays banks for reserves they hold in excess of regulatory minimums. The effect of the decrease, to 99-hundredths of a percent from 1.62 percent, is to encourage banks to lend more money, although the banks are still under administrative controls governing the total volume of their loans. Unexpectedly strong increases this year in exports, industrial production and consumer price inflation, together with a jump in fixed-asset investment announced today, are prompting many economists to begin questioning whether Chinese leaders can follow through on pledges to slow the growth rate of the economy to 8 percent this year, from 9.5 percent last year. 'We have an economy that is stronger than we thought; the slew of January and February numbers is pretty impressive,' said Jonathan Anderson, a UBS economist here. If growth continues to accelerate in China this year, creating greater demand for raw materials, it could push even higher the prices of crude oil and other commodities that China already imports in enormous quantities. Copper prices jumped 2 percent today in London to a record $3,307 a ton as Chinese companies placed large orders, while oil prices were down slightly after member countries of the Organization of Petroleum Exporting Countries agreed to increase production by 2 percent. The big question now is whether the Chinese economy's vigor, combined with a huge inflow of both speculative and long-term investment, will feed inflation within China, which could be socially and even politically disruptive. While consumer prices were 3.9 percent higher last month than a year earlier, some economists are less worried now about inflation than they were in the spring of last year, as the pace of growth has become more even among many sectors of the economy. Construction of new steel mills, which boomed in early 2004, has slowed. Some of the fastest growth this year has been in exports, while investment spending has soared fastest this year in areas that proved bottlenecks to growth last year, notably coal mining, electricity generation, oil refining and transportation. Liang Hong, a Goldman Sachs analyst, said that she had no plans to increase her forecast that consumer prices in China would rise just 2.6 percent this year, even though she expects growth to exceed the government's target of 8 percent. 'It seems to be close to 9 rather than close to 8,' she said. Qu Hongbin, an HSBC economist, said Chinese regulators had been effective in persuading banks to slow the annual growth rate in loans, to less than 15 percent now from 24 percent at the end of 2003. This will start slowing investment spending and the rest of the economy soon, he predicted. But Andy Xie, a Morgan Stanley economist, was more pessimistic, contending in a research note that China faced an overheating economy and a property bubble. Vigorous economic growth and rising exports combined with currency speculation are increasing the pressure on China to allow greater flexibility in its currency, which is known as the yuan or renminbi and has been effectively pegged at 8.28 to the dollar for almost a decade. Prime Minister Wen Jiabao surprised financial markets on Monday by mentioning that if China acted on the currency, it would do so unexpectedly, although he also cautioned that there would be risks to the global economy from any revaluation. China's foreign currency reserves jumped nearly $100 billion in the fourth quarter alone as the central bank exchanged yuan for the flood of dollars pouring into the country mostly through unofficial channels. Raghuram Rajan, the research director of the International Monetary Fund, urged China in a speech here on Tuesday to let the yuan trade in a wider range, a step that would likely result in its appreciation in the short term, saying that steps like interest rate controls, bond sales and capital controls could not indefinitely prevent the inflow of money from feeding inflation. 'The inflation genie can indeed be bottled up,' he said. 'Eventually, however, it will get out as all these controls lose their effectiveness. Long-term undervaluation is simply too difficult to manage.' Investment in factories, office buildings and other fixed assets in urban areas climbed 24.5 percent in the first two months of this year compared with a year earlier, an acceleration from a year-over-year increase of 21.3 percent in December, China's National Bureau of Statistics said today. Data for the first two months of the year are often combined in China because of difficulties in adjusting for the shifting dates for the beginning of Chinese New Year celebrations, which depend on a lunar calendar.

Subject: Video from Krugman/Tanner debate?
From: Ted
To: All
Date Posted: Wed, Mar 16, 2005 at 21:15:53 (EST)
Email Address: Not Provided

Message:
Does anyone know if/where I can find a recording of the debate between Krugman and Cato's Michael Tanner at the NY Society for Ethical Culture on Tuesday? Thanks.

Subject: Vanguard Indexes
From: Terri
To: All
Date Posted: Wed, Mar 16, 2005 at 15:34:01 (EST)
Email Address: Not Provided

Message:
Vanguard has changed almost all of index funds to the Morgan Stanley index family. The Morgan Stanley indexes have the advantgae of lower turnover, more tax saving because of lower turnover, weights that are based not on total stock outstanding in a company but on shares that are actually traded. The Morgan Stanley indexes are generally broader than the previous indexes. I find the changes in indexes most agreeable.

Subject: Weighting of Insiders
From: johnny5
To: Terri
Date Posted: Wed, Mar 16, 2005 at 21:34:02 (EST)
Email Address: johnny5@yahoo.com

Message:
I don't know how all this ties in terri but didn't morgan stanley get in on the funny side of all this mess going on the past few years with the scandals? They have many bad things to say about morgan stanley here is one: http://www.kamalsinha.com/morganstanley/mutual-funds/ Mutual Funds July 15. SEC Investigating Morgan for high fees of its S&P index funds. Normally index funds' annual expenses are around 0.2 percent to 0.5 percent while more traditional funds requiring significant research cost more. Morgan Stanley's Standard and Poor's fund cost 1.5 percent in expenses each year. Why? SEC wants to know. Here is another: http://lawprofessors.typepad.com/whitecollarcrime_blog/2005/01/goldman_sachs_a.html January 26, 2005 Goldman Sachs and Morgan Stanley Settle SEC Complaints About IPO Allocations The SEC announced that it filed and settled complaints against Goldman Sachs and Morgan Stanley relating to the allocation of shares in Initial Public Offerings (IPO) to clients of the firms by requiring those receiving shares to place orders to purchase additional shares, thereby raising the price of the stock. Each firm agreed to pay a civil penalty of $40 million. Maybe I am not comprehending what going to an MS index means but why would vanguard who has kept above all this mess associate in any way with such a name? I don't understand. I need some of you more astute people to help me understand this new weighting. Now over the years of reading silicon investor I read about many naked short scams where people illegally short stocks without borrowing shares - or other kinds of short scams - I think it works like this - a company issues shares to some guy - a ceo or insider or whoever for whatever reason - this guy has an offshore account - the float is increasing because of his shares - so he shorts the stock and then dumps his shares and sells them - they issue him more shares - through his offshore account he shorts the stock even more and dumps more shares - and down and down the stock go. Usually the people making the decision to short the stock are the same ones receiving it and dumping the shares through crafty transactions. Now take XOM recently, someone just dumped a HUGE pile of shares right after the price of oil reached a new high taking XOM and the price of oil down - now if this was an insider and his shares weren't counted in the weightings but only the regular traded stocks - can this not distort an indexers view of the fair market value of companies composing the index. I mean doesn't total stock outstanding give you a more accurate picture of what can happen to the stock if a ton of insiders decide to dump? Or am I really confused again and wether the insiders dump or not should not affect someone wishing to try and guess the future price of a stock?

Subject: Perfect for Investors
From: Jennifer
To: johnny5
Date Posted: Wed, Mar 16, 2005 at 21:59:49 (EST)
Email Address: Not Provided

Message:
Indexes are statistical models, that are formed by companies such as Morgan Stanley or Standard and Poors or Merrill Lynch or Goldman Sachs and others. The MSCI indexes are perfect for investors. We can however use what we wish.

Subject: Re: Perfect for Investors
From: johnny5
To: Jennifer
Date Posted: Wed, Mar 16, 2005 at 22:06:53 (EST)
Email Address: johnny5@yahoo.com

Message:
But haven't every one of the companies you listed gotten in big trouble for lies and deceit - there are huge ethical issues here - and it seems to me you are saying - well that lied about all that other stuff that distorted the markets and got in trouble but they won't lie on their statistical models to distort the market and hurt the little guy and I don't comprehend why?? They scammed us jennifer- MSDW, Goldman - all of them - why trust a snake to be a bunny rabbit in any thing when all he knows how to do is bite you and inject poison?

Subject: Explosive Mix in Mexico's Politics
From: Emma
To: All
Date Posted: Wed, Mar 16, 2005 at 12:28:22 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/16/international/americas/16letter.html?pagewanted=all&position= The Explosive Mix in Mexico's Politics By JAMES C. McKINLEY Jr. MEXICO CITY - For months the political debate in Mexico has been dominated by an escalating war between the populist mayor of this giant capital city and President Vicente Fox. On the surface, the fight seemed to be an endless shouting match about the rule of law and the meaning of democracy until both sides called a temporary cease-fire to the mudslinging last week. The president and his aides repeatedly charged the mayor with putting himself above the law, while the mayor accused the Fox administration of using a trumped-up charge of contempt of court to knock him off the presidential ballot in 2006. Underlying the dispute, however, is something much more explosive: an abiding fear among business leaders and conservatives of Mayor Andrés Manuel López Obrador, a messianic leftist who has become the most popular politician in the Democratic Revolutionary Party and a man whom they suspect of harboring a secret agenda of rolling back 10 years of economic liberalization and introducing lavish social programs the government cannot afford. The paradox, some political analysts are saying, is that in their determination to preserve the economic changes, the conservatives may be undermining something even more precious: Mexico's fragile democracy. Conservatives, among them Mr. Fox himself, appear to think that Mr. López, if elected, may take up the mantle of Hugo Chávez, the leftist president who has roiled politics in Venezuela. And they are willing to support nearly any measure that would keep him from winning, even if it means banning him from the ballot with a relatively minor conviction for ignoring a court order. 'Fox sees López Obrador and he thinks populist, he thinks Chávez, he thinks devaluation, the end of the economic liberalization model he has tried to keep afloat,' said Denise Dresser, professor of political science at the Autonomous Technological Institute of Mexico. 'I think he's reacting very much with his gut.' For his part, Mr. López has dismissed the comparison to President Chávez as a gross simplification meant to scare voters. 'Every people has its own history, leaders; they are distinct realities; there are no twins,' he said last month. 'I am the product of very special circumstances, so I have nothing to do with Chávez.' Still, Mr. López has put forward an ambitious plan aimed at the working class that flies in the face of the current government's mission to nurture private business. For instance, he rejects any plans to privatize Mexico's oil and energy industries. He has promised national food subsidies for people over 65 and free medicine and medical care for every citizen. He also wants to investigate a fund set up in 1998 to bail out banks. 'When you talk about populism, you have to be careful,' he said to a reporter recently. 'One talks about it when there are programs to help poor people, but rescue the bankers and we call it development.' Santiago Creel, the current secretary of government who is seen as the most likely candidate for president from Mr. Fox's conservative National Action Party, known as PAN, made it plain in a recent interview he thought a López presidency would be an economic disaster. 'What is clear is that he has rejected all the economic reforms that we have put forward, all of them,' Mr. Creel said. 'And it's clear that his government has raised the level of public debt in a very important way and has also raised the levels of subsidies, making a pretty artificial economy.' Whether the conservatives' fears about the economy are well founded or not, Mr. López, who is enormously popular, does have a history of challenging entrenched interests. After he lost the fraud-ridden 1994 election for governor of Tabasco, his native state, he and his supporters took their grievances to the streets, taking over oil wells, holding sit-ins and blocking highways. Similar unrest in 2006 would taint Mr. Fox's claim to have constructed a true democracy, and Mr. López, with characteristic pugnacity, has already vowed to run a martyr's campaign from behind bars if the court case against him goes forward. Besides provoking ugly street protests, political analysts fret that the move to nip Mr. López's candidacy in the bud with a legal move would most likely cause widespread disillusionment with the elections. More than 50 of the nation's most respected intellectuals signed a public letter urging the Congress to drop the effort and let Mr. López be judged at the ballot box rather than in court. To many Mexicans, the crime that Mr. López is charged with does seem trivial by past standards. The prosecutors in Mr. Fox's Justice Department say officials in the mayor's administration ignored a judge's order to halt the construction of a road to a private hospital. Whether the mayor knew of the order is not known. Still, a conviction would disqualify him from the presidential race under Mexican law. The president and his aides have cast their fight against the mayor as one to preserve the rule of law, which they see as one of Mr. Fox's few accomplishments. Speaking about the mayor, the president said the country must consolidate the culture of complying with the law and added, 'There cannot be, nor must there be, exceptions.' Mayor López has made fun of these pronouncements, saying President Fox is no better than past party bosses and even dictators. 'It's gotten into the citizen president's head that I shouldn't be on the 2006 electoral ballot, and they are trying to push me aside,' he said. Some political analysts even see a new, antileft alliance forming between Mr. Fox's party and the old governing party he defeated in 2000, the Institutional Revolutionary Party, or PRI, an idea leaders of both parties deny. The theory is that the conservatives would rather see the PRI back in the president's mansion and themselves in the role of loyal opposition than see their economic reforms shredded. Other political analysts say the fears among conservatives of a López presidency are overblown. Congress is not likely to change much, they argue, and no party will have a majority. So Mr. López will have the same trouble passing his agenda that Mr. Fox has had. Still, it remains to be seen whether the president and the leaders of the PRI will opt to let the voters decide whether a leftist should get a chance to head the state. 'For the first time a leftist could possibly become president,' Ms. Dresser said. 'It's immensely threatening to them.'

Subject: Yuan and Dollar
From: Emma
To: All
Date Posted: Wed, Mar 16, 2005 at 11:01:30 (EST)
Email Address: Not Provided

Message:
The peg Yuan dollar will be changed, though likely when we least expect. I would guess a basket of currencies may replace the single currency peg. I would guess a stepwise increase in value of the Yuan. Remember, for a century as Brad DeLong writes economists did not find convergence in development finally began to doubt it would happen. Certainly development models proved faulty again and again. Then, there is China and with China there is India and South Africa and Brazil. Speak with an African, and there is intense optimism about China as a model; if only.

Subject: Growth and Currency
From: Emma
To: Emma
Date Posted: Wed, Mar 16, 2005 at 11:13:39 (EST)
Email Address: Not Provided

Message:
China will have a currency reserve loss when the Yuan increases in value against the dollar. But, China will have a more valuable Yuan and China will have developed apace having weathered a currency crisis in 1998 and slowing international growth periods before and after 1998.

Subject: OPEC changes its story
From: Pete Weis
To: All
Date Posted: Wed, Mar 16, 2005 at 10:49:57 (EST)
Email Address: Not Provided

Message:
This won't be good for the current account problem: OPEC says it's lost control of oil prices Cartel producers say they can't keep up with strong global demand MSNBC Updated: 4:51 p.m. ET March 15, 2005 With world oil prices north of $50 a barrel and rising, OPEC ministers meeting in Iran Wednesday will be grappling with a problem they haven’t confronted in the cartel’s 45-year history. In the past, OPEC tried to cool overheated prices by pumping more when supplies got too tight. But most OPEC producers say they’re already pumping as fast as they can. And despite the high cost of a barrel of crude, world demand shows no signs of slowing. As a result, some OPEC ministers say, they’ve run out of options in trying to rein in the price of crude. Global oil demand has taken up most of the slack in extra OPEC capacity. Consumption is now believed by many analysts to be pressing up against the limits of what the world can produce. Saudi Arabia is the only country believed to have any surplus production left, and even then the Saudis are pumping close to 90 percent of capacity, according to the U.S. Department of Energy. 'There is not much we can do,” Algerian Oil Minister Chakib Khelil told reporters Tuesday in Isfahan, Iran, the site of Wednesday’s meeting. 'OPEC has done all it can do.” Qatar Oil Minister Abdullah al-Attiyah said. “This is out of the control of OPEC.' But that hasn’t eased political pressure on the cartel. On Tuesday, several oil ministers said they had received calls from U.S. Energy Secretary Sam Bodman. Sen. Ron Wyden (D Ore.) said Tuesday he’s not convinced that OPEC’s hands are tied by global demand reaching the limits of production capacity. “This is their claim,” said Wyden. “But the fact of the matter is that nobody knows what their capacity is.” Though data on OPEC’s oil production capacity have always been hard to come by, there’s little disagreement on the rapid growth of global consumption -- especially in China and India. With worldwide demand this year rising by roughly 2 million barrels per day, whatever excess capacity is out there will be gone soon, according to Marshal Adkins, an oil industry analyst at Raymond James “Maybe this year, but certainly in ‘06 there won’t be any excess capacity,” he said. “We haven’t been in that kind of market in our lifetime. You’ve always have more capacity than demand.” That’s little solace to energy consumers, who are watching rising crude oil prices push pump prices to record levels. Though U.S. economy has yet to show signs of slowing and inflation remains low, a continued rise in oil prices will eventually slow growth, analysts say. “We will find the price level that will slow demand,” said Adkins. “It may be $60; it may be $100. I think it’s fair to say its going to be in that price band.” Seasonal lull? Analysts say OPEC typically eases back on production at this time of year because demand slows as the winter heating season winds down and drivers haven’t yet hit the road for summer vacations. But with prices nearly double levels just 18 months ago, production cutbacks are unlikely, say analysts. “OPEC’s only real option is to maintain the status quo for now,' said Smith Barney Citigroup oil analyst Doug Leggate in a recent research report. Oil prices have also risen for a variety of other factors over which OPEC has no control, according to Adkins. Tanker prices haven jumped from $3 a barrel to $10 a barrel during the recent run-up in crude prices. To increase output, Saudi Arabia has been selling lower grade crude, which has boosted the price of more desirable light, sweet crude. And the falling dollar has effectively cut the value of oil payments to OPEC producers. “When were looking on our screens seeing $45 oil, Saudis are cashing checks for $25 oil,” he said. “So in their mind -– their $25 price (target) -– that’s what they’re getting.” As rising demand has approached the world’s production limits, OPEC’s decisions have less impact on prices. In the past, the cartel has 'controlled' oil prices (or tried to) by adding or withholding production. By holding back oil, the market remained 'tight' and prices stayed relatively high. The 'oil shortages' of the 1970s were engineered by OPEC -- not the result of a true lack of supply. But production quotas have had mixed success. For starters, many OPEC producers have 'cheated' over the years -- agreeing cut back at OPEC meetings but then pumping more when they went home. A big run-up in inventories in 1997, for example, came just in time for the Asian economic meltdown in 1998. OPEC couldn’t cut production fast enough and oil prices fell to $10 a barrel. But eventually cutbacks sent prices back up above $30 a barrel by 2000. Then came the U.S. stock market crash, Sept. 11 and recession -- which sent oil back down to $15. OPEC cut production again, and prices began their run back to $30 -- and beyond. Now, with prices above $50, OPEC risks seeing prices tumble again if high energy costs put a damper on world growth. That’s why – despite relatively high crude oil inventories for this time of year – Saudi Arabia has proposed boosting production by 2 percent, to 27.5 million bpd. 'We're concerned about prices, we're also concerned about economic growth and we're particularly concerned about economic growth in developing countries,' said Saudi Oil Minister Ali al-Naimi. 'Hopefully I will be convincing enough to move the rest to my thinking.' But ministers from Iran, Kuwait and Nigeria have recommended postponing any increase until May 1 to see if demand eases as it usually does in the second quarter. And some OPEC ministers don’t think oil prices at current levels will slow the global economy. Some U.S. analysts concur, noting that the U.S. economy is less dependent on oil than it was during the “oil shocks” of the 1970s, when oil hit $80 a barrel when measured in today’s dollars. 'Even at $60 we see no economic impact,' Libyan Energy Minister Fathi Omar Bin Shatwan told reporters.

Subject: Learn About Vanguard
From: Terri
To: All
Date Posted: Wed, Mar 16, 2005 at 10:31:54 (EST)
Email Address: Not Provided

Message:
There is a reason to learn all that may be learned about Vanguard. There are other fine companies, but Vanguard has long been the leader in investor concern and orientation.

Subject: Berkshire Hathaway and Insurance
From: Emma
To: All
Date Posted: Wed, Mar 16, 2005 at 10:27:30 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/16/business/16buffett.html Even Buffett Can't Avoid Dark Clouds Settling Over Insurance Industry By JOSEPH B. TREASTER He embodies the Middle American archetype of the plain-speaking, straight-shooting businessman. In the age of imperious chief executives, he is cheered by investors at annual gatherings that include barbecue and baseball. After years of corporate scandals, Warren E. Buffett, 74, nearly stands alone as a paragon of management. But an accelerating investigation into certain insurance practices has ensnared one of Mr. Buffett's main businesses, raising the possibility that the most gleaming reputation in corporate America may be tarnished. Insurance is at the core of Mr. Buffett's company, Berkshire Hathaway. The Securities and Exchange Commission and the New York attorney general have been investigating a deal between a Berkshire unit, General Re, and American International Group, the world's leading insurer, that may have artificially bolstered A.I.G.'s finances. That inquiry led to the departure Monday of the man who built and ruled A.I.G. for nearly four decades, Maurice R. Greenberg. And investigators are looking into other so-called finite insurance deals by Mr. Buffett's companies. 'Some of his transactions may come back to haunt him,' said Andrew J. Barile, an insurance consultant. 'He did a lot of the kinds of deals they're looking at.' At company headquarters in Omaha, a spokeswoman, Debbie Bosanek, said Mr. Buffett would not comment. In defense of Mr. Buffett, insurance experts say Mr. Buffett's management of Berkshire is very different from Mr. Greenberg's time at A.I.G. While Mr. Greenberg had his hands on practically every aspect of A.I.G., Mr. Buffett, known more for his investing acumen than management prowess, prefers to delegate. 'If there is damage, it might be limited to the insurance units, without having a major impact on the Berkshire dynasty,' said Ric Marshall, chief analyst at the Corporate Library in Portland, Me. 'This won't have a personal impact on Buffett in the way it did with Hank Greenberg. It's a matter of personal style and involvement.' Mr. Buffett has not been named in any of the insurance investigations. Still, General Re is also under investigation by the Justice Department for its role in providing policies to a failed liability insurance company that operated in Virginia, Tennessee and other Southern states. And it has been named as a defendant in lawsuits by two insurance regulators. Last May, the Australian unit of General Re agreed to pay a $27.2 million settlement with the Australian Securities and Investments Commission over coverage to two Australian insurers that eventually collapsed. The transaction took place before Berkshire bought General Re in mid-1998. But Berkshire must still deal with Australian officials on the consequences of the transactions. In his annual report to investors this month, Mr. Buffett said the liquidator of the two Australian companies planned to file claims against Berkshire, maintaining that General Re contributed to the downfall of the companies by helping them with improper accounting. Yesterday, Berkshire disclosed that it had received a notice to show cause from the Australian Prudential Regulation Authority. Berkshire said General Re had until March 29 to show why it should not be investigated. Berkshire says it is cooperating with all of the investigations. There are other differences between Mr. Buffett and Mr. Greenberg. Like many chief executives, Mr. Greenberg was keenly aware of his company's quarterly performance. Mr. Buffett, on the other hand, has always managed for the long run and discouraged trading of Berkshire shares. One of his techniques to accomplish this was to refuse to split the stock into shares of manageable trading size. The stock closed yesterday at $89,900, down $700. Since Berkshire was not trying to show consistent quarterly gains, the insurance experts said, it is extremely doubtful that Berkshire would have bought the kind of coverage that Mr. Greenberg is said to have arranged to strengthen his balance sheet. Nonetheless, Mr. Buffett often speaks almost rhapsodically of his enthusiasm for insurance and he most certainly has overseen some of the major deals done by Berkshire units. And, along with the other major reinsurers, General Re and other Berkshire units have widely offered the kind of insurance that has been the latest focus of investigators, financial reinsurance, or finite insurance as it is often called. 'It is possible that Gen Re, through the sale of some of these finite insurance products, could have some financial liability,' said Kevin Lampo, an analyst with Edward Jones in St. Louis. Finite insurance allows companies, often insurers, to spread their risk of loss on an asset or business over time and also distribute risk among other insurers willing to take it on in exchange for premiums. It becomes questionable when it appears not to be insurance - that no risk was transferred from one party to another - but essentially a loan. Much finite insurance does involve a transfer of real risk. Even so, one insurance executive said, it is probable that investigators 'will find a lot of transactions they don't like very well,' because the risk factor may have been minimal if present at all. David Schiff, the editor of Schiff's Insurance Observer, an industry newsletter, said investigators may focus on the intentions of buyers and sellers of financial insurance and treat the suppliers of the coverage less harshly than buyers who sought to distort their financial statements. 'If a seller calls up a buyer and says, 'We've got a great form of insurance if you want to phony up your books,' that's one thing,' Mr. Schiff said. 'But it may be another if someone calls up and says, 'I want to buy it,' and the answer is, 'Yeah, we'll do it.' ' Ira Zuckerman, an analyst at the Stanford Financial Group in Boca Raton, Fla., said it seemed highly unlikely that Mr. Buffett's reputation would take a big blow as a result of the insurance investigations. 'If in fact he was involved in any of this and if the deals were wrong, then he has some responsibility,' Mr. Zuckerman said. 'But I don't think it tarnishes his image a whole hell of a lot considering what he's built from ground zero. I would think it's a smudge, but it's not a smear.'

Subject: China: Stability and Development
From: Emma
To: All
Date Posted: Wed, Mar 16, 2005 at 10:24:18 (EST)
Email Address: Not Provided

Message:
I think we must detach ourselves from an American vantage to an extent, especially so with regard to China and likely Asia in general. We have always had difficulty understanding China. There are 1.3 billion people in China. For most of the last century, economic development was terribly slow and there were repeated setbacks. By adopting increasingly broad market structures, and careful macro economic control China is now on what appears to be a sustained rapid economic growth path that might continue for decades as she closes with well developed countries. However, market development has produced significant economic imbalances from rural to urban, in infrastructure, in social services, in income and wealth. China's leaders and advisors to leadership are aware of the imbalances, and the leadership is aware of instability that imbalance can bring in its wake. There is development, there is concern about stability. Which is the prime concern? Stability. Much of what the leadership is about is assuring a stable development process. We must look at the adoption of economic and political policy from this vantage. The currency peg of Yuan to dollar has helped foster astonishing growth but also stability. The Chinese central bank will always opt for stability, and consider the price of holding American debt small when this is achieved. Growth is so much the better, and growth there surely has been.

Subject: A Contract
From: Jennifer
To: All
Date Posted: Wed, Mar 16, 2005 at 06:14:25 (EST)
Email Address: Not Provided

Message:
When wishing to cancel a contract during a grace period, it would be a proper idea to have a witness present, put everything in writing, have all necessary papers signed, keep copies of all papers, and do all that is necessary this very day. A bank signature guarantee is simple to gain. Act immediately.

Subject: Contract
From: Jennifer
To: Jennifer
Date Posted: Wed, Mar 16, 2005 at 06:18:39 (EST)
Email Address: Not Provided

Message:
Put everything in writing, keep copies of each document, have a witness, have a bank signature, call an attorney if there is the least problem. Act at once.

Subject: Act at Once
From: Jennifer
To: Jennifer
Date Posted: Wed, Mar 16, 2005 at 07:21:50 (EST)
Email Address: Not Provided

Message:
Please act at once in the way you wish. All must be done as you wish this day. I wish you well.

Subject: Signature Guarantee
From: Jennifer
To: Jennifer
Date Posted: Wed, Mar 16, 2005 at 08:26:10 (EST)
Email Address: Not Provided

Message:
A signature guarantee can be had from any bank, from any account person, this should be gotten immediately along with a copy. State precisely what is to happen with the contract. Please act at once, so all will be done by the contract deadline.

Subject: Excellent advice....
From: Pete Weis
To: Jennifer
Date Posted: Wed, Mar 16, 2005 at 10:30:18 (EST)
Email Address: Not Provided

Message:
and extremely important. Johnny should get his uncle to an attorney, especially one who is experienced in these matters, immediately.

Subject: Re: Excellent advice....
From: Ari
To: Pete Weis
Date Posted: Wed, Mar 16, 2005 at 11:04:38 (EST)
Email Address: Not Provided

Message:
Stopping the contract should be easy as long as you are in the time limit, so you must act now. Then, you can chhose again with more knowledge. Vanguard may be ideal.

Subject: Thanks everyone
From: johnny5
To: Ari
Date Posted: Wed, Mar 16, 2005 at 11:27:55 (EST)
Email Address: johnny5@yahoo.com

Message:
He is going to the bank at 1 to get a signature gaurantee. I really appreciate everyone's help and will give him all the advice, I am going through the phone book for attorneys now!

Subject: Re: Thanks everyone
From: Jennifer
To: johnny5
Date Posted: Wed, Mar 16, 2005 at 12:00:17 (EST)
Email Address: Not Provided

Message:
The signature guarantee and a an immediate visit to the boker, should solve the problem at once.

Subject: Raymond James lying to my uncle
From: johnny5
To: All
Date Posted: Wed, Mar 16, 2005 at 03:02:09 (EST)
Email Address: johnny5@yahoo.com

Message:
AN update for you Pete: Well my uncle according to law had 10 days after receipt of the annuity contract to get out of it, he went to their office yesterday to do so - already 5 days into his 10 days. The broker first said who is telling you this is bad - my uncle told them VANGUARD - she said VANGAURD are fools - this is the best thing for you. Then he said I never wanted to lock my money away for 30 years - the contract lasted until 2035 - the agent said huh - you are only locked in for 7 years and this did go along with what was in the original brochure about the contract which said 7 years - but what he got from the jackson national life was 30 years - so my uncle showed the front page of the annuity that showed it was for 30 years - not the 7 the agent assumed - I don't know if the agent was truly this ignorant or out right lying - but after this the agent said well look - you have 30 days to think it over - so take the annuity home and get back with me in a few weeks - don't be hasty - and then he showed the agent again where the contract said he only had 10 days and 5 days were already passed - the agent feigned ignorance I believe but took my uncles contract and said fine she has never had this happen ever in her 15 years in the business but will refund his contract. Well we called jackson national life today (the guy was in india - so they are offshored) and they had not heard anything from the agent, they said my uncle would have to send them a signature gaurantee (from a bank officer I believe) saying he wanted out of the contract to refund his money. Why does congress and our regulators allow an industry where this kind of crap is happening? Or am I just over-reacting again? Old people have serious impaired mental facilities and to unleash thier finances on these wolves seems a serious disservice to me, but I really get the feeling a lot of these insurance salesman have been fed the company line for so long they feel this is the BEST investment for old retiring clients without looking at each case individually.

Subject: Sad to say.............
From: Pete Weis
To: johnny5
Date Posted: Wed, Mar 16, 2005 at 10:25:44 (EST)
Email Address: Not Provided

Message:
that the investment industry, nowadays, is full of corrupt and unethical practices. There is little to no government oversite and few laws have been enacted to protect the small investor. Look at the constant barrage in the news regarding investors losing their life savings - whether we are talking about predatory annuities, phony corporate accounting (which continues), ineffective corporate governance, failing hedge funds, and stock analysts still on the take. It's almost to the point of taking a lawyer with you, who is experienced in the securities business and annuity contracts, when you sit down with a broker. It might not be a bad idea for your uncle to contact a lawyer pronto. It's truely sad. We must rely on ourselves and get the education we need to navigate these dangerous investment waters.

Subject: 3 Times I have seen the light
From: David E...
To: All
Date Posted: Wed, Mar 16, 2005 at 02:12:20 (EST)
Email Address: Not Provided

Message:
at the end of the tunnel. 3 times the light was a train heading for me. I am a fool, but no more. The first time was the destruction of Saddam's castle. The second time was 'Mission Completed'. The third time was elections in Iraq and the mideast. Every time the relief was followed by knowledge that these events obscured a knowledge that the situation was worse than imagined.

Subject: The trouble is Minnie - there aint no light
From: johnny5
To: David E...
Date Posted: Wed, Mar 16, 2005 at 02:35:13 (EST)
Email Address: johnny5@yahoo.com

Message:
http://www.prudentbear.com/internationalperspective.asp In April, 2003, just weeks after the invasion of Iraq, Vice-President Cheney echoed many Wall Street predictions that by the end of the year Iraq would be able to raise its oil output as much as fifty per cent over prewar levels. Before the war, the Iraqi National Oil Company was pumping about two and a half million barrels a day. Now, with the help of money, personnel, and equipment provided by the American government, it is pumping about 1.8 million barrels a day—at least, on those days when insurgent attacks on pipelines and storage facilities don’t force a cut in production.

Subject: When does bush stumble off the stage?
From: johnny5
To: johnny5
Date Posted: Wed, Mar 16, 2005 at 02:44:06 (EST)
Email Address: johnny5@yahoo.com

Message:
http://www.cmt.com/news/articles/1491022/09162004/williams_sr_hank.jhtml Country gospel is genuine currency of the realm, a timeless message that transfers seamlessly from generation to generation. Williams himself, who was the original country star who set the pattern for sinning on Saturday night and seeking redemption on Sunday morning, seemingly looked into the face of eternity with the lyrics of 'I Saw the Light.' He wrote it in 1948: I wandered so aimless, my life filled with sin/I wouldn't let my dear savior in/Then Jesus came like a stranger in the night/Praise the Lord, I saw the light. The melody, ironically, is identical to that of the Chuck Wagon Gang's 1935 country gospel song 'He Set Me Free.' Melodies back then -- like now -- were fluid vehicles to be liberally borrowed from. Williams -- who granted virtually no interviews in his life -- never talked about the circumstances of writing that song. But his mother, Lillian, after his death, said the idea stemmed from an evening early in his career. She explained, 'We was drivin' back from doin' a show in Georgiana [Alabama], and I was drivin' and Hank had his head in my lap, and he said, 'Oh, Mamma, I'm tired, so tired, but I know we're almost home because I saw the light.'' The light he mentioned was from the beacon at the airport. Toward the end of his life, Williams was so drunk or drugged one night in San Diego that he stumbled off stage after finishing only two songs in the first show of a two-show evening gig. Minnie Pearl and the show promoter's wife drove him around town to try to sober him up enough to do the second show. They tried to get him to sing along with them to revive him. He sang only one verse of 'I Saw the Light' before stopping. 'Minnie,' Williams said, 'I don't see no light. There ain't no light.'

Subject: Soviets spent themselves into oblivion
From: johnny5
To: All
Date Posted: Tues, Mar 15, 2005 at 22:08:07 (EST)
Email Address: johnny5@yahoo.com

Message:
A reason why the 2cnd greatest superpower ever collapsed - http://afgen.com/dollar_decline.html When the bismark sunk the hood, the smart germans did not rejoice in her defeat, but shrieked in horror that such a powerful ship could fall so quickly - for it meant the bismark could fall as well as it eventually did. But after watching such a great nation crumble, who asks can the USA spend themselves into oblivion too? I wish more of these gold people would realize GOLD is not what the world wants, OIL is, and it is the dollars relation to OIL that made oil pricing a determinant of excess monetary inflation - not gold and silver pricing as this guy argues - well with oil prices up and rising and looking to stay that way - doesn't this lead to the fact monetary inflation is up and the printing presses are running at warp speed?

Subject: Re: Soviets spent themselves into oblivion
From: johnny5
To: johnny5
Date Posted: Tues, Mar 15, 2005 at 22:32:37 (EST)
Email Address: johnny5@yahoo.com

Message:
http://www.a1-guide-to-gold-investments.com/risky-scheme.html Again another new article arguing for GOLD - but johnny5 has been all over the world, and lived in many places and seen many things, and when it comes to people, he never saw land made of gold, or a house made of gold, or food made of gold, what johnny5 did see was people needing land and houses and food and usually some cigarettes and moonshine to make them forget all their troubles. When gold is a good house material, or used to grow our food, then johnny5 will agree with these guys - but from rich to poor and black to white and peaceful to warlord - johnny5 sees certain trends, oil, land, food, if you had bought $100 worth of gold coin in 1925 and $100 of oil in 1925 and $100 of fine wine in 1925 and $100 worth of s&p 500 in 1925 - which one would be worth more today? http://experts.about.com/q/1615/2910196.htm I've tried all my sources, but none have been able to come up with a viable 1925 wine. There were a few out there with private collectors, but they weren't willing to part with the bottles because they were part of verticals of a particular wine. Sorry. It seems NO PRICE can buy the 1925 wine - hmmm. Too bad here in florida there are no basements for a good wine cellar.

Subject: ...all wrong...?
From: Pancho Villa
To: All
Date Posted: Tues, Mar 15, 2005 at 21:39:14 (EST)
Email Address: nma@hotmail.com

Message:
Fed chief: Expect Social Security cuts Greenspan tells Congress that cuts in future retirement benefits are all but inevitable. March 15, 2005: 5:12 PM EST By Kathleen Hays, CNN economics correspondent NEW YORK (CNN/Money) - Federal Reserve Chairman Alan Greenspan told Congress that the mounting financial pressure of a wave of retiring baby boomers is so great that cuts in future government retirement benefits are all but inevitable. Fed Chairman Alan Greenspan told Congress that without reform, Social Security costs could cause the economy to 'stagnate or worse.' NEW YORK (CNN/Money) - Federal Reserve Chairman Alan Greenspan told Congress that the mounting financial pressure of a wave of retiring baby boomers is so great that cuts in future government retirement benefits are all but inevitable. The Fed chairman told the Senate Special Committee on Aging that the nation has about three years to work out a fix. 'In 2008, the leading edge of what must surely be the largest shift from retirement in our nation's history will become evident as some baby boomers become eligible for Social Security,' he said in his prepared remarks. By that date, the population 65 years and older will be more than one-fourth of the adult U.S. population, Greenspan said, referring to forecasts by the Social Security trustees. That would be up from 17 percent currently. 'This huge change in the structure of our population will expose all our financial retirement systems to severe stress and will require adjustments for which there are no historical precedents,' he said. This huge demographic shift is the main reason why Social Security and Medicare are facing enormous financial obligations that he says cannot be met without some choices that most in government are loathe to make. 'At present, the Social Security trustees estimate that the unfunded liability over the indefinite future to be $10.4 trillion,' Greenspan noted in his prepared remarks. 'The shortfall in Medicare is calculated at several multiples of the one in Social Security.' 'These numbers suggest that either very large tax increases will be required to meet the shortfalls or benefits will have to be pared back,' he said. Greenspan also stressed that rising spending on Social Security, Medicare and Medicaid is one more reason why the federal budget 'is on an unsustainable path, in which large deficits result in rising interest rates and ever-growing interest payments that augment deficits in future years.' 'Unless the trend is reversed, at some point these deficits would cause the economy to stagnate or worse,' he said. Senator Hillary Clinton challenged the Fed chairman on his support for tax cuts early in President Bush's first term. Many Democrats blame the tax cuts for helping turn the budget surplus that existed at the end of President Clinton's first term into record deficits, and lately more and more have accused Greenspan of favoring Bush policies, contrary to his official status as an independent chairman of the Federal Reserve. Greenspan said most leading economists at the time had expected budget surpluses to stretch into the future, citing forecasts by the Office of Management and Budget as well as by the bipartisan Congressional Budget Office. And he said that he had also pushed for tight rules on Congressional spending and more fiscal discipline. 'I don't think that the issue is a question of taking a wholly different view... It turns out we were all wrong,' he said, referring to the prevailing budget surplus forecasts. He also said that he would take the same position again if he was faced with the same circumstances. Senator Clinton finished her questioning with a quick parting shot: 'Just for the record, we were not all wrong, but many people were wrong.' Greenspan also repeated his support for some kind of private investment accounts. The main reason he gave is that putting part of people's retirement taxes in a private account would be like putting them in a 'lock-box' so that the funds could not be diverted into spending on other government programs. http://money.cnn.com/2005/03/15/commentary/column_hays/greenspan_socialsecurity/index.htm?cnn=yes

Subject: Re: ...all wrong...?
From: johnny5
To: Pancho Villa
Date Posted: Tues, Mar 15, 2005 at 21:58:40 (EST)
Email Address: johnny5@yahoo.com

Message:
'Greenspan said most leading economists at the time had expected budget surpluses to stretch into the future, citing forecasts by the Office of Management and Budget as well as by the bipartisan Congressional Budget Office. And he said that he had also pushed for tight rules on Congressional spending and more fiscal discipline. 'I don't think that the issue is a question of taking a wholly different view... It turns out we were all wrong,' he said, referring to the prevailing budget surplus forecasts. He also said that he would take the same position again if he was faced with the same circumstances. ' These guys need to take some classes on quantitave finance at thier local university and some demographic planning courses at their local community college. Why can't they just print more dollars - if more people are gonna need there 500 dollar SS paycheck, just buy a few more printing presses right? Oh thats right, they already did.

Subject: Paul Krugman was Right
From: Jennifer
To: johnny5
Date Posted: Wed, Mar 16, 2005 at 08:28:53 (EST)
Email Address: Not Provided

Message:
Paul Krugman was right as usual in warning repeatedly against the excessive and imbalanced and unfair tax cuts.

Subject: It's strange.......
From: Pete Weis
To: Jennifer
Date Posted: Wed, Mar 16, 2005 at 10:46:55 (EST)
Email Address: Not Provided

Message:
to hear a fed chairman not very concerned about the current account deficit 'because America is such a good place for foreigners to invest and therefore they will continue to pump their surplus dollars right back into our economy', and yet so worried about a social security system which begins to run into trouble 35-40 years from now. Rescind the tax cuts on the wealthy and pump the extra tax revenue in the social security system and up the age one can begin to collect on SS 10-20 years down the road and you solve this problem. But we had better act quickly, now, to reduce the twin deficits or we will find ourselves in trouble in a hurry.

Subject: Re: It's strange.......
From: Terri
To: Pete Weis
Date Posted: Wed, Mar 16, 2005 at 11:06:19 (EST)
Email Address: Not Provided

Message:
There will soon be a paper about by Paul Krugman on domestic economic policy. Possibly a week.

Subject: China wants OIL, not dollars
From: johnny5
To: All
Date Posted: Tues, Mar 15, 2005 at 21:09:40 (EST)
Email Address: johnny5@yahoo.com

Message:
Well after they unleash their dollar hordes into buying oil - what do you predict this will do to XOM? http://www.iii.co.uk/news/?type=afxnews&articleid=5236224&subject=markets&action=article (AFX UK Focus) 2005-03-14 08:53 GMT: China foreign exchange chief suggests buying oil with forex reserves - report Article layout: reformatted BEIJING (AFX) - China could use some of its huge foreign exchange reserves to purchase imported oil, Guo Shuqing, director of the State Administration of Foreign Exchange, was quoted as saying. The China Business Post reported Guo as saying in an interview: 'Such a move would not cost us too much of our foreign exchange reserves... Purchasing 100 mln tons of oil would require only some 30 bln usd.' China had foreign exchange reserves of 609.9 bln usd as of the end of last year, ranking it second only to Japan. Guo made the suggestion during the recent session of the Chinese People's Political Consultative Conference, an advisory body to the nation's parliament. Guo noted this was not official policy and was a personal opinion though he added that the nation's foreign exchange reserves were higher than necessary. allen.feng@xinhuafinance.com al/wk Central banks Oil, oil products Foreign exchange

Subject: Recession?
From: Pete Weis
To: All
Date Posted: Tues, Mar 15, 2005 at 14:49:23 (EST)
Email Address: Not Provided

Message:
From the San Diego Tribune: Economists forecasting a recession By Dean Calbreath UNION-TRIBUNE STAFF WRITER March 15, 2005 The U.S. economy will likely face a recession before President Bush leaves office, and growth in the California economy will be tepid at best for the next several years, according to a report released yesterday by the economists of UCLA's respected Anderson Forecast. Rising interest rates and declining government spending are setting the stage for a recession, the economists warned. And economic stimuli such as tax cuts have run their course. Although no recession is likely this year, one could occur as soon as next year and will likely take place before Bush leaves office in 2008, said Edward Leamer, director of the forecast. 'From the height at which we are standing today, there is only one way to go – down,' Leamer said. Leamer added that as early as this summer, weakness in the national real estate market could begin slowing down the economy. That is especially true in California, which has relied heavily on real estate to boost its weak employment levels. 'The real estate market will begin to cool over 2005 and with it one of the primary drivers of the current economic expansion in the state,' said Christopher Thornberg, a senior economist at the Anderson Forecast. 'Whether or not you believe there is a real estate bubble, it is clear that the primary driver of California growth over the past few years cannot maintain its current trend on any level.' Thornberg noted that the housing boom over the past several years has helped boost consumption – by making homeowners believe that they have a greater net worth – and employment. Of the 243,000 private payroll jobs that California has added over the past two years, 122,000 are directly related to the housing market – either in construction, real estate or home financing, Thornberg said. But once home prices slow down or decline, California's consumption rates and job market also will slow, he said. Other economists share the concerns expressed in the Anderson Forecast. 'I agree that there's not a chance of a recession in 2005, but there could be one in 2006 or 2007,' said Esmael Adibi, an economist at Chapman University in Orange. 'And if there is a recession at that time, it will be driven by consumers who are feeling the pinch from rising interest rates and oil prices.' The mood among California consumers – whose spending habits typically account for about 70 percent of economic growth – is already beginning to sour, according to a report released yesterday by Chapman's Anderson Center for Economic Research, which is not affiliated with the Anderson Forecast. Over the past two quarters, California's consumer sentiment – reflected in polls measuring the public's attitude about the economy – has declined 10 percent to its baseline of 100 points, while U.S. consumer sentiment has risen 5 percent to 104 points, the report said. That marks the first time in two years that California's mood has dipped below the U.S. average. 'Although job creation has gained momentum, persistent high gasoline prices and higher expected inflation are making consumers pessimistic about current economic conditions,' Adibi said. 'And their outlook about future economic conditions has also become less optimistic.' Adibi said one reason consumer sentiment has cooled in California rather than in the rest of the nation is that gasoline prices have risen faster here than elsewhere. 'Every $10 increase in the price of a barrel of oil – if it's sustained for six months or a year – shaves off half a percentage point from the gross domestic product and also adds to inflationary pressures,' he said. The price of a barrel of oil has doubled from the mid-$20s to the mid-$50s since the beginning of last year. A growing number of market watchers say they do not expect prices to decline anytime soon. 'Until global oil supplies catch up to Asia's soaring demand, there is the risk that oil prices hovering around $50 per barrel will remain the rule rather than the exception,' said Joseph Quinlan, chief market strategist for Banc of America Capital Management. Besides high oil prices, rising interest rates are another omen of economic slowdown. Although interest rates are still low by historical standards,the Anderson Forecast report warns that a sudden rise in rates – especially as mortgage rates catch up with the rate increases imposed by the Federal Reserve – could cause home prices to implode, sparking another recession in California and the United States. 'Rising interest rates are the biggest threat to this expansion,' said economist Leamer, adding that the tail ends of all previous expansions were marked by rising interest rates. Even though it appears that the country is still recovering from its last recession – especially in terms of employment levels – Leamer said that by historical standards, the recovery already has lasted longer than most expansions. The current expansion, which officially began in the first quarter of 2002, is now 13 quarters old. Five of the past nine expansions have ended at 14 quarters or less. Only three have lasted more than 20 quarters. By historical standards, Leamer said, the current recovery seems like a 'middle-aged expansion [that] is going to the nursing home.' The only thing that could revive the economy, Leamer said, is a dramatic boost in exports, driven by the low value of the dollar. 'The declining value of the dollar relative to the euro is sure to stimulate exports in the year ahead,' Leamer said. Other economists and market watchers question that assertion, saying the dollar has declined for the past two years, and the growth in exports continues to lag far behind the growth in imports. 'The fall of the dollar against the euro and yen is not reducing the trade deficit,' said Peter Morici, economist at the University of Maryland. 'Americans continue to buy Japanese and German cars even if those cost more, and German and Japanese automakers can accept narrower profits to defend market shares.' Peter Schiff, head of Euro Pacific Capital, added that the falling dollar 'only exacerbates the trade deficit by increasing the cost of imports.'

Subject: Re: Recession?
From: Terri
To: Pete Weis
Date Posted: Tues, Mar 15, 2005 at 16:38:39 (EST)
Email Address: Not Provided

Message:
http://news.yahoo.com/news?tmpl=story&u=/latimests/20050315/ts_latimes/realestatereliancemayhurtcalifornia Real Estate Reliance May Hurt California This is the Los Angeles Times article on the Anderson forecast. A key to understanding what may happen may be the how quickly and how much the Federal Reserve raise rates from here.

Subject: Re: Recession?
From: Terri
To: Terri
Date Posted: Tues, Mar 15, 2005 at 20:17:04 (EST)
Email Address: Not Provided

Message:
http://www.timesheraldonline.com/Stories/0,1413,296~31519~2763501,00.html Report: Cal economy will be tepid growth as housing boom wanes More on Pete's article....

Subject: If the dollar falls
From: johnny5
To: Terri
Date Posted: Tues, Mar 15, 2005 at 20:58:41 (EST)
Email Address: johnny5@yahoo.com

Message:
Tourism from the rich euros and yens should go up as they visit our country on their great wealth, they will come to disneyworld and disneyland and wish to take a little piece of sand home with them maybe. As an international traveler I want to see the great natural wonders and great cities of a nation and also their small rural places to observe thier older culture. The majority of my money in foreign lands was spent on food and hotels and busses and tour guides. In the usa certainly most of that will go to california, florida, new york, washington DC and the grand canyon and hoover dam. Maybe the amish in lancaster, PA and the mormons in SLC, Utah will get some of that business too.

Subject: Demand for Dollars
From: Terri
To: All
Date Posted: Tues, Mar 15, 2005 at 14:38:27 (EST)
Email Address: Not Provided

Message:
Interestingly, there were 91 billion dollars of net interenational securities purchases in America in Janaury. Using Euros or Pounds or Australian and Canadian dollars or Yen to buy the S&P makes sense to me. There is the limit to a decline in dollar value; the value of our assets.

Subject: Re: Demand for Dollars
From: johnny5
To: Terri
Date Posted: Tues, Mar 15, 2005 at 20:35:25 (EST)
Email Address: johnny5@yahoo.com

Message:
To the external world what would be worth having in the USA, what makes us special to a foreign investor. We do have land, we can grow food on that land, we can build industries on that land, we can extract oil from that land, we can teach people science on that land. Well I live in france say, I don't need american land - have my own, I don't need american oil - cheaper elsewhere or I will ride my bike, I don't need american food cheaper elsewhere or I will grow my own, I don't need an american car cheaper elsewhere, I don't need an american education - I can get on the internet and learn virtually. To this guy in france, america is worthless. Now bin laden blows up paris - well if America can ensure my children a global peace and wack that guy - maybe I do need an want and value an american military - but I don't think he does - so you say our assets have value to him - other than what the gubbment can extract from the US taxpayer to honor its burden on treasury debt he bought - what other value would this self sufficient french guy see in american assets?

Subject: S&P a definite loss for most....
From: Pete Weis
To: Terri
Date Posted: Tues, Mar 15, 2005 at 15:03:30 (EST)
Email Address: Not Provided

Message:
overseas investors. 'There is the limit to a decline in dollar value; the value of our assets.' Yes but where is that limit. Presently demand for dollars is less than supply. That's why the dollar has been falling now for the last three years. Over the last year the nominal return on the S&P has been tepid at best. Anyone who has invested in the S&P index has lost money in 'real' terms. Certainly Europeans are among the first to notice this since any investment by Europeans in the S&P made a year ago would return them fewer Euros presently than the amount of Euros they had originally invested. I believe all the currencies you listed would have meant losses for any investment in the S&P - isn't that correct? As long as we have a current account deficit and a budget deficit which requires heavy borrowing because we spend more than we make, the dollar will continue to fall.

Subject: The value of our assets...
From: Pete Weis
To: Pete Weis
Date Posted: Tues, Mar 15, 2005 at 15:07:15 (EST)
Email Address: Not Provided

Message:
can certainly decline also. Besides ownership of 'our' assets via our borrowing is being transfered overseas to boot.

Subject: Re: The value of our assets...
From: Terri
To: Pete Weis
Date Posted: Tues, Mar 15, 2005 at 16:46:05 (EST)
Email Address: Not Provided

Message:
From a Euro country, as an investor, I would not be buying American bonds but would be buying American stocks. Bonds are being bought either by foreign central banks or hedge funds playing interest rate spreads or companies that must hold liquid assets here.

Subject: Investing in Europe
From: Terri
To: All
Date Posted: Tues, Mar 15, 2005 at 13:44:26 (EST)
Email Address: Not Provided

Message:
Before we turn away from investing in Europe, we should remember that productivity growth and corporate income are easily competitive with us. There are terrific corporations through Europe, and countries that have consistently fine economic growth and fine stock market returns. If demographic and aging are so much of a looming problem, why is Sweden so robust? Why does 'socialist' Sweden have such a robust stock market? We need to look closely.

Subject: Re: Investing in Europe
From: johnny5
To: Terri
Date Posted: Tues, Mar 15, 2005 at 20:23:35 (EST)
Email Address: johnny5@yahoo.com

Message:
I agree this is important for our diversication issues, now I am an old man in france that likes cheese and wine. And Saft Battery is making the bucks on the world market, I am gonna get my buds together and we are gonna vote in politicians that really stick it to the young workers, to the big profitable companies, and anyone else we can stick it too so that my check keeps coming and I can sit around and drink wine and eat cheese. How are the young workers supposed to escape this or the profitable french companies? The can leave france and move to africa and south america can't they?

Subject: Investing in Developed Countries
From: Terri
To: All
Date Posted: Tues, Mar 15, 2005 at 13:18:29 (EST)
Email Address: Not Provided

Message:
There has been little study on population growth and decline patterns and market effects, this depite such effects often being speculated about. The problem with such study is the time constraint. Population changes generally are exceedingly slow. There is speculation that population declines developing in Japan and Europe will slow economic growth, while the aging of the populations strains the ability of governments to provide social services. Will this be so? Can lower economic growth in Japan and Europe than in America be attributed to quicker aging? Will American growth slow as we age? What about even China, which will age rapidly? I do not know the answers, but since changes in population are so slow in coming effects that develop will do so slowly. Investment planning for a possible demographic effect will be difficult because of the subtle emerging of any effects. Then there is technology. Can productivity increases compensate for muted population growth? The difficulty of answering these questions should make us wary of investing as if we knew the answers.

Subject: Re: Investing in Developed Countries
From: johnny5
To: Terri
Date Posted: Tues, Mar 15, 2005 at 20:18:35 (EST)
Email Address: johnny5@yahoo.com

Message:
Emma I love technology, I embrace it and dream about it and use it as much as I can, I read alvin tofflers future shock and say when does it get too hard - but that is me - for most around me (my siblings and relatives) futureshock has hit and they can't watch tv or use their cellphone because it is beyond them. Now in my youth I saw so many things that I thought needed fixing and technology fixed them, but I see far fewer things today technological advancements can realistically bring. The free energy boom of oil is gone - demand is outsripping supply channels - we need some new energy tech to revolutinize extraction, production and distribution - I don't see much growth in those areas. Population wise we had lots of land - but the earth is just one ball of dirt among many and if we want to move people off this planet we need major tech advances in space and materials - I hope the carbon nanotube science and space elevator kick off that age. And then their is the human mind, it can only reasonably store so much knowledge and information depth and breadth wise - I would wager on a systemic level our society may can never approach some of our fanciful visions because the human brain factor is the limiting one - only AI will succumb that limitation and we are not making a lot of tech progress there yet either - but maybe quantum science and biology will bring new advances there. I find most of the people in the park here unable to keep all the viruses off their computer, or spam off thier phone text messages, or hackers stealing thier credit card or bank accounts for nefarious purposes. It's one thing to expect grandma millie to protect her gold coin under her mattress - how does she protect herself against the digital cowboy jesse james when she can't even spell computer? The solution it seems has been to turn it over to the STATE to protect them - but that gives a lot of power to a few and even if those few are good, the temptation is great.

Subject: Developing and Developed Nations
From: Emma
To: All
Date Posted: Tues, Mar 15, 2005 at 09:59:22 (EST)
Email Address: Not Provided

Message:
There are about 575 million people in southern Africa, and we must hope for and assist in their well being and development of their 47 countries. But, they will not develop unless we participate. Therein lies their hope and ours. I am optimistic about a sustained period in which development becomes truly widespread, but we will benefit immensely if this becomes so. America and Europe and Japan and Australia and Canada can well bind themselves more tightly to nations of lesser development, for our own sakes.

Subject: World Melting Pot
From: johnny5
To: Emma
Date Posted: Tues, Mar 15, 2005 at 20:06:07 (EST)
Email Address: johnny5@yahoo.com

Message:
How long has it taken the warring europeans to make long lasting peace - oops - how long has it taking the warring asians to make long lasting peace - oops - how long has it taking the warring arabs to make long lasting peace - oops - how long has it taken the warring latins to make long lasting peace - oops - umm I am not so confident emma that africa is going to overcome thier tribal roots and wars and violence. Why do you think they will given most other parts of the world with thousands of years of history have not. Back when I was in college the foreign exchange people wanted to send me to tanzania - well a couple of people had just gotten swung from a tree because of color - they were white - I chose france instead - they said make love not war - but I hear lately they are having a problem with muslims. Gates is giving africa billions in medicine, and the UK sends them lots of clothes, and if china perfects thier pebble nuclear reactors then africa can have lots of safe localized energy - but will this make warring tribes stop wanting to kill their neighbor?

Subject: Investing
From: Emma
To: All
Date Posted: Tues, Mar 15, 2005 at 08:14:19 (EST)
Email Address: Not Provided

Message:
There are lovely and optimistic reasons to invest. We wish to secure ourselves of course, but we also can and should wish that our investments will help others, that there should be imagination behind the success of our investments. The resources of America are of the intellect and effort as well as of the surrounding environment. We need to think biologically and ecologically in investing, and not merely of limits such as of who we shall care for because of a sudden limit in Medicaid as we are experiencing.

Subject: Re: Investing
From: johnny5
To: Emma
Date Posted: Tues, Mar 15, 2005 at 19:57:35 (EST)
Email Address: johnny5@yahoo.com

Message:
I just got through watching on cspan the national science budget and how we can't afford to teach our young or the immigrants coming in a good science education anymore - Aren't the dreams of immortality and an end to cell death and future human expansion beyond planet earth very dependent on putting more money into the young engineers of the future than they are subsidizing the last months of life of the sick and old? If this nation would simply scale back on an average new home size of 2000 square feet to maybe 1200 square feet think of the savings in energy, but grandma and grandpa need thier space no? I look at all the new homes being built around here in florida and my god the space in them is unbelievable, the 10 and 12 foot vaulted ceilings, the huge saunas and baths, the overly expansive dens and kitchens, I live in a singlewide 1974 14x60 - certainly the energy for my home is much less than those.

Subject: Biological Resources
From: Emma
To: All
Date Posted: Tues, Mar 15, 2005 at 07:18:12 (EST)
Email Address: Not Provided

Message:
Can we afford to preserve that which is most precious to us and about us? There is the biologically based question we must ask to form the rationale to continually develop our biological resources and services. What after all is life with no butterflies?

Subject: Why invest in Europe?
From: johnny5
To: All
Date Posted: Tues, Mar 15, 2005 at 06:30:16 (EST)
Email Address: johnny5@yahoo.com

Message:
First off the BULL run of 1950-2005 is GONE my friends - there will still be SOME growth in latin america and africa - but nothing like we have experienced recently. Expect a muddle through world economy. Certain african and latin american centers will prosper and have tremendous growth. http://www.prb.org/Content/NavigationMenu/PRB/Educators/Human_Population/Population_Growth/Population_Growth.htm When you look at this trend, I conclude american growth has had it, latin america and africa are the places to be. Given this, and given that europe is going to see the WORST decline - shorting europe and going long africa/latin america seems to be the best long term strategy if you were a warren buffet and wanted to do long term currency bets. Of course ENERGY is even more important than demographics because cheap OIL made this 1950-2005 population growth possible. Perhaps this chart will go negative in the future for world population growth if our energy supplies have run up against the wall.

Subject: Re: Why invest in Europe?
From: johnny5
To: johnny5
Date Posted: Tues, Mar 15, 2005 at 06:35:38 (EST)
Email Address: johnny5@yahoo.com

Message:
Developed nations have had it, you can forget about BOOMS in population to contribute to wildly growing bull markets like the past 50 years have seen, just a slow steady trend of world population growth with better numbers in africa and latin america, they will need energy and food and commodities - what use do they have over the next 20-30 years for a green piece of paper with franklin on it from a country that doesn't have a lot of energy or food to export?

Subject: Re: Why invest in Europe?
From: RL
To: johnny5
Date Posted: Tues, Mar 15, 2005 at 08:50:27 (EST)
Email Address: rafaelloring@yahoo.es

Message:
your prediction has some weakenesses. When developed nations have economic problems developing ones go in deep trouble. Developed nations are not only the big market where developing ones sell their exports, growth in those countries is also financed by investors of ODCE's. Developing countries can catch up in good times bad in bad times they usually do very bad. RL

Subject: Re: Why invest in Europe?
From: Institutional Investor
To: RL
Date Posted: Tues, Mar 15, 2005 at 10:40:21 (EST)
Email Address: Not Provided

Message:
Johnny, what model are you using to come up with GDP. Using the cobb-douglas model, solow showed that the greatest impact in GDP was due to increases in technology, not increases due to capital or labor.

Subject: Re: Why invest in Europe?
From: RL
To: Institutional Investor
Date Posted: Thurs, Mar 17, 2005 at 03:48:13 (EST)
Email Address: rafaelloring@yahoo.es

Message:
Totally agree. Demographic growth has had little impact in developed countries since WWI. As you suggest technology is the main source of growth and the solow model shows is the only way to increase GDP per capita in the long term (when the K* is reached). In developing countries one can even argue in many cases that demographic growth has been an obstacle to growth(making labour so cheap that investing in capital or technology is not worth it and reducing GDP per capita, education, and health resources). That has been the case in many African countries. RL

Subject: How much tech growth is left?
From: johnny5
To: Institutional Investor
Date Posted: Tues, Mar 15, 2005 at 19:47:08 (EST)
Email Address: johnny5@yahoo.com

Message:
Very good comments II - I will read up on solow and try to find some good academic studies. I am most worried about impacts on mine and terri's and the rests economic future and investments in the us stock market and vangaurd funds and wether european investment would be a prudent choice for diversification - GDP growth rates may strongly correlate to that or not. No model II, just my intuition from working on a farm with migrant workers that a 40 acre farm can only sustain so many people and become so productive - there are limits to labor and tech and financing - and if day 1 I have just myself on the 40 acre farm and 50 years later 300 people are working on this 40 acre farm can we really squeeze out much more productivity by increasing labor or technology? When considering economies of scale and that we went from about 2 billion to 7 billion from the 1950's to 2005 a 3x increase and from here on out we will see NOWHERE near that population growth maybe a .5x increase over the next 50 years at best - the world just can't have the BOOM in growth it has had in people or credit as that flows better than oxygen already it seems - the people just won't be there to keep adding to the global population to sustain growth and money in the AIR with RFID credit cards that have already taken financing to new levels. Sure we can bring education and modern development to the third world, but that same page says already 2/3 of the globe are URBAN and not rural - so that is not gonna be a huge increase either. So short of some massive technological upheavel that makes nuclear tech, communication tech, and computer tech look like kindergarden level tech - I don't see tech growth doing much to help world GDP growth over the coming years. Back on the farm I may can get rid of 300 workers and let them sit down and feed them with an interest only financed farm using oil based fertilizer and oil based tractors but I don't see that there will be much new tech to feed the 600 kids that those 300 non workers may produce. No tech boom, no energy boom, no comm boom, no population boom, we had all those the past 100 years - academic papers that make future predictions using data that only takes into account the multiplicative effects of these booms on each other may sell a very rosy picture to vanguard investors for the next 10-20-50 years. In the 80's I used to see around me so many things I thought could get better with tech - today I don't.

Subject: Re: How much tech growth is left?
From: RL
To: johnny5
Date Posted: Thurs, Mar 17, 2005 at 04:05:43 (EST)
Email Address: rafaelloring@yahoo.es

Message:
J5, the thing with tech is that you never know how one where it would make a break throuth. But I can imgine many ways... for a start a cheap and endless energy source could create a huge expansion of productivity

Subject: Re: How much tech growth is left?
From: johnny5
To: RL
Date Posted: Thurs, Mar 17, 2005 at 06:09:26 (EST)
Email Address: johnny5@yahoo.com

Message:
I watch stargate atlantis and they have magic zero point modules to give them amazing power, and I watch star trek and they have dilithium crystals for amazing power. Then I open my haliday, resnick and walker physics book and realize most of that stuff truly is fantasy. Cheap endless energy would change things, but we live in a universe of conservation of energy. We can do nuclear, and that will give us a great boost, but it is not going to be cheap or endless. we have lots of energy from the sun and lots of matter from all the particles around us on the earth - but there are limits.

Subject: Re: How much tech growth is left?
From: RL
To: johnny5
Date Posted: Thurs, Mar 17, 2005 at 07:16:18 (EST)
Email Address: rafaelloring@yahoo.es

Message:
This is all speculation and again reality allways have surprises but let me also play Star Trek.... Yes conservation of energy...., take sea water for example (H2O) contains Hydrogen and Oxygen. Is from our perspective (as well as solar energy) and endless source of energy.

Subject: Re: How much tech growth is left?
From: johnny5
To: RL
Date Posted: Thurs, Mar 17, 2005 at 08:55:14 (EST)
Email Address: johnny5@yahoo.com

Message:
http://www.futurereality.org/modules.php?op=modload&name=News&file=article&sid=36&mode=thread&order=0&thold=0&PHPSESSID=70febc321ed30fdc6372473e906d6ee6 This was something I read that seems to feel solar is the future, but 10 billion requiring solar and not the saved solar that has been stored in hydrocarbons may be too much demand to keep them all alive and get switched over in time.

Subject: Re: How much tech growth is left?
From: RL
To: johnny5
Date Posted: Fri, Mar 18, 2005 at 05:20:38 (EST)
Email Address: rafaelloring@yahoo.es

Message:
'Of all hydrogen used today, about 97% comes from fossil fuels (primarily precious natural gas) and 3% from electrolysis of water. What long-range sense does it make to use our finite fuel sources just to make a different form of energy? In the case of electrolysis, it takes more energy to separate the hydrogen than is returned when the hydrogen recombines with oxygen.' solar 'One very important fact to remember as we move to a civilization fueled by incoming solar energy is that it takes considerable energy to melt and process the silicon into photovoltaic cells. Initially, this input energy was more than the cell would produce in its lifetime. With steady improvements, this pay back period is now as low as one year, which means that it takes the first year of electrical output just to provide the seed energy to make additional solar cells.' steady improvements????, isn't that techonolgy? and just in the lapse of only a couple of decades, couldn't it happen the same with electrolisis, or maybe even other way of separating H2 from O?

Subject: Our Biological Resources
From: Emma
To: All
Date Posted: Tues, Mar 15, 2005 at 06:23:40 (EST)
Email Address: Not Provided

Message:
Though I refer to health care, I am thinking broadly of biologically related resource services. Thinking of environmental or ecological needs is to me related to thinking of health care. There is information technology, and there is the information technology advance that can and must allow for increased ecological sensitivity.

Subject: Health Care as our Resource
From: Emma
To: All
Date Posted: Tues, Mar 15, 2005 at 06:15:33 (EST)
Email Address: Not Provided

Message:
Health care and allied services can be perceived as a precious resource for us. There is no reason why demand for health care services should not increase indefinitey as we grow, and why such services may not be a source of comparative trade advantage. We must think creatively here, and question assumptions that would limit how creatively the resource can grow as we grow.

Subject: Health Care as a Precious Resource
From: Emma
To: All
Date Posted: Tues, Mar 15, 2005 at 06:05:25 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/13/magazine/13HEALTH.html?ei=5070&en=2e33226b719725ce&ex=1110949200&pagewanted=all&position= The Quality Cure? By ROGER LOWENSTEIN David Cutler hit what seemed to be the peak of his career at 28, when as a junior faculty member at Harvard he was whisked down to Washington to help draft a health-care bill under the tutelage of Ira Magaziner and, of course, Hillary Clinton. The project produced a dispiriting result: nothing. Corporations, consumers, the uninsured and doctors had all been clamoring for reform, and the question of why the project failed has nagged at Cutler ever since, especially as the problems have continued to worsen. In the years since he left Washington, which was in 1994, the ranks of the uninsured have surged, from 35 million people to 45 million. There are also serious gaps in the quality of care, and there is a deep dissatisfaction with the way the system functions -- in how it seems to make adversaries of patients, doctors and insurers, for instance. Arguably, Americans want health-care reform more urgently than anything else. Yet designing a national health-care policy has become a kind of taboo. Congress provided prescription drugs for seniors, and President Bush, not normally thought of as timid, has backed some modest initiatives: legislation to limit malpractice suits, individual health savings accounts. But Washington has done nothing on the scale that a social engineer -- a Robert Moses or a Daniel Patrick Moynihan -- might to reinvent the system. Cutler has thought about this ever since his failed experience in Washington, and his diagnosis has shaken up the health-care-policy world. ''The real reason health-care reform has not succeeded,'' he has written, ''is that it is rooted in a misconception of what health-care reform should accomplish.'' Virtually every would-be reformer, Democrat and Republican alike, starts with the presumption that the major problem in health care is high costs. This is understandable: America now spends 15 percent of its gross domestic product on health care. That's a higher percentage than any country has ever spent in the history of the planet, and the figure is increasing. The United States spends more on health care than on automobiles; we spend more on health care than China spends on tea; in fact, as Cutler likes to point out, we spend more on health than the Chinese spend, per capita, on everything. And health care threatens (far more than Social Security) to consume the federal government. Medicare, the health-care program for retirees, and Medicaid, which provides basic services for the poor, already account for one-fifth of the federal budget, and their share could double in a generation. Curbing such growth has been the aim of every reformer, and according to Cutler, it is the reason reform has failed. The Clinton team proposed to pay for universal coverage by limiting increases in spending (partly through mandatory caps). But limiting spending also meant limiting service. The proposed legislation was never put to a vote. Managed care was next at trying to contain costs. It succeeded for a while, until it became clear that Americans did not want health-maintenance organizations to limit their choices any more than they wanted the government to. Since then, reform has languished. The Medicare drug bill is suggestive of why. The Republican Congress promised restraint but then passed a hugely expensive law that barred Medicare from using its clout to negotiate prices with drug companies. The pattern has been failed efforts to control costs, followed by a void of new ideas. Cutler's approach is radically different. He says that most health-care spending is actually good. Spending has been rising, he says, because it delivers positive, and measurable, economic value, and because it can do more things that Americans want. Therefore, Cutler says, we should focus on improving the quality of care rather than on reducing our consumption of it. Rather than pay less, he wants to pay more wisely -- to encourage health-care providers to do more of what they should and less of what is wasteful. This, as it turns out, is exactly what some of the most innovative health-plan sponsors -- from Kaiser Permanente to General Electric -- are doing. To them, the Cutler approach of focusing on quality offers a way out of the void and possibly, over the longer term, an acceptable route to restraining costs. To understand how Cutler has upended conventional thinking, you first have to understand the political straitjacket in which health care has found itself. Health care ''lefties,'' as Cutler refers to some of his colleagues, favor a European system -- universal insurance financed by a single payer (the government) and some sort of rationing to hold down the screaming increase in high-tech procedures. Canada rations by limiting access: Ontario, with one-third the population of California, has one-tenth the number of open-heart-surgery facilities. While Cutler acknowledges the merits of such an approach, he also sees its problems. The British may be accustomed to waiting for hip replacements, but Americans do not like rationing. Also, systems with just one payer do not encourage innovation and experimentation. Imagine America if everyone were on Medicare. Doctors and hospitals would do whatever Medicare approved and nothing more. Right-wingers go for a market approach -- it's not the technology they object to, but people's cheap access to it. If people paid for their own angioplasties, so the theory goes, they would have fewer of them. This is the theory behind Bush's health savings accounts, initiated during his first term: let people buy insurance from their own (tax-sheltered) pockets. Apart from the obvious objection that low-income people find it hard to save for those accounts, Cutler points out another shortcoming: Most of the dollars spent on health care are spent on people with serious illnesses or conditions. Those with coverage quickly move into the territory covered by insurance. Few people really pay for their own angioplasties, so few care what they cost. Moreover, it's not clear that we want people to be too price-sensitive, especially people with chronic conditions, lest they try to starve themselves of care. ''My grandmother used to say, 'Why should I take the blue pill -- I'm feeling better,''' Cutler recounts. ''The blue pill was why she was feeling better.'' As Cutler told me in the first of our many conversations, ''Ultimately, every discussion of health care turns personal.'' A tweedy, self-effacing 39-year-old, Cutler is a seriously modified lefty. He envisions a system in which everyone could get insurance while free-market incentives would motivate health-care providers to be more effective as well as more efficient. Instead of suppressing the market by rationing care, restraining prices or regulating doctors, he wants to liberate it. It is neither Clinton nor Bush -- but closer to Bill Bradley, whose 2000 campaign Cutler advised. Dr. Robert Galvin, head of global health care at General Electric, says, ''David has showed everyone that the way to rein in costs is not to squash innovation.'' The soft-spoken Cutler was a star even as a Harvard undergraduate, when he assisted an up-and-coming economics professor named Larry Summers. Finance -- not health care -- was the hot field among economists, but as a graduate student, Cutler wrote a still cited dissertation on how changes in Medicare's compensation scheme caused hospitals to release patients after shorter stays. It proved, Cutler says, that doctors were incredibly and, in some cases, ''horribly,'' responsive to incentives. Hired onto the economics faculty at Harvard, he was urged by Summers to continue in health care. After his stint in Washington, Cutler continued to think of ways of rationing care until, at lunch one day, an economist named Zvi Griliches asked him, ''Why is it you think I get too much health care?'' He said it in a thick Polish accent -- ''Vy is it?'' Cutler immediately saw his point. He was looking at the wrong side of the ledger; instead of worrying about the cost of health care, he should think about the benefits. This sounds obvious, but almost no one was looking at it this way. Thinking of people he knew -- ''all health care is personal'' -- Cutler wondered if Americans might be spending more because they were getting more and better treatment. Joining with Dr. Mark McClellan, another economist, he zeroed in on heart disease. The pair discovered a curious fact: heart attacks were occurring less frequently, thanks to drugs for treating high blood pressure and to reductions in smoking, but spending on heart attacks was rising. Surgery rates -- $25,000 for an angioplasty, $40,000 for a bypass -- had been relatively stable. But as the technology improved, the operation was being performed far more often. Was that an example of waste? Looking at the data, they discovered that, on average, heart attack victims were surviving eight months longer than in the 1980's. In economic terms, they argued, the increased spending was ''worth it.'' Subsequently, Cutler concluded that a 45-year-old American could expect to spend $30,000 over the course of his life on all forms of cardiac care and that, thanks to improvements in cardiac technology alone, he could expect to live three years longer. That worked out to $10,000 a year of added life. Cutler can rattle off figures to prove that Americans value life even more. (Air bags cost something like $100,000 per year of life saved, for instance.) But you don't need to be an economist to believe that $30,000 for three extra years is a pretty good deal. McClellan now runs Medicare, where he is experimenting with paying doctors for better results -- a Cutler-like departure from the old policy of simply trying to restrain costs. But it is Cutler, now the dean of social sciences at Harvard College, who has plainly broken from the health-care establishment. In a book published last year, ''Your Money or Your Life,'' Cutler summarized his research as follows: ''The evidence shows clearly that spending more has been good; we get a lot more out of the medical system than we put in.'' The book won praise from The New England Journal of Medicine and other publications. ''It's good to see in Cutler's study an analysis of some of what has gone right,'' a reviewer in The Los Angeles Times commented. Critics responded that good health care could be much less expensive. Canada spends only 10 percent of its G.D.P. on health care, but according to common yardsticks like longevity and infant mortality, Canadians are just as healthy. Dr. John Wennberg, a health-care expert at Dartmouth, and his colleague Jonathan Skinner point out that some areas of the United States, like Boston and Miami, spend far more than others, like Minneapolis, without any noticeable improvement in mortality. This leads them to conclude that the additional spending is fruitless. Ira Magaziner, who ran the Clinton effort, says that project was meant to eliminate just such redundancy and also to make a serious dent in administrative costs. ''There is a lot of waste you can take out of the system before you get to questions of rationing,'' he says. In any case, the Clinton plan's complexity, as well as the secretive style in which it was developed, probably did as much to torpedo it as rationing, which is what Cutler has focused on. Cutler, who reads as many medical journals as economics ones, does not dispute that America buys more health care than it needs. He estimates that 20 percent of spending (such estimates are all over the map) is unnecessary, much of it for tests and specialist consultations. Indulgent Boston, for instance, has 1.7 times as many specialists per capita as frugal Minneapolis. But it is extremely difficult to weed out only the ''bad stuff,'' Cutler says. Oregon, he notes, tried to proscribe ''unnecessary'' procedures for Medicaid patients. It ended up relenting on almost everything. In any case, the idea that America could trim spending to Canadian levels is probably unrealistic. American doctors earn more than those in Canada. Our culture tolerates, even approves of, greater disparities in income; Congress is not likely to legislate a change. Canada also enjoys a ''free rider'' benefit. Drug makers earn a return on their investment in the United States, and so are willing to accept price caps in the smaller Canadian market. And since Canada has just one insurer (the government), its doctors spend less on administration. However, health-care costs in Canada have increased at nearly the same rate as in the United States. In fact, spending growth in most developed nations -- regardless of how they finance and organize care -- has been moving ahead at similar rates. Since 1960, costs in six of the G-7 countries have risen, on average, by 4.9 percent a year. The rise in costs in the United States, at 5.1 percent annually, is close to the middle of the pack. Sherry Glied, of Columbia's School of Public Health, concludes that ''no particular characteristic of any health-care regime is the main determinant of growth in costs.'' Technology is. Critics of America's profligate ways fret about the relentless character of spending increases, and they have a point. Even when technologies lower costs, they increase spending by broadening the market. More people have gallbladders removed because laparoscopic surgery is less invasive. More people take medication for depression because the Prozac-era drugs have fewer side effects than earlier drugs. In fact, doctors diagnose depression more often. Better treatments lead to higher use. Contrary to the fears of many on the left, higher prices are not the chief culprit. Thanks to continued pressure from H.M.O.'s, doctors' rates have been held in check. So have the prices of pharmaceuticals already on the market. But because new drugs are more expensive, and because people take more pills, total spending on drugs since 1990 has quadrupled. As Cutler says, medical spending isn't increasing because of inflation so much as because of people consuming more ''good stuff.'' This view is beginning to course through the health-care world. Scanning the literature, you now happen upon sentences like, ''We believe that some of the concern about the growth in spending may be misplaced'' (Health Affairs) and ''On average . . . society is better off exchanging more money for better health'' (The Journal of Economic Perspectives). No one disputes that spending will continue to increase; limiting the rate of growth is the most we can hope for. Since he reckons that most of what we get is beneficial, Cutler puts primary emphasis on improving the quality of care. ''Most of economics is about the cost of things,'' he notes. ''There has been little effort to figure out what the benefits are. That's often more difficult. How do you value clean air, lower crime or improved health?'' What Cutler has in mind is a twofold plan. First, he proposes a variant of the voucher system. Let the government finance people's -- everyone's -- health care, with tax credits to be spent on private providers or insurers. But vouchers would only broaden the system, not improve it. To accomplish the latter, Cutler wants insurers, both public and private, to redesign the way doctors and hospitals are compensated, to give them an incentive to compete on quality. At first blush, this struck me as pretty naive -- the sort of mushy academic theory that could lead, ultimately, to higher bills. Cutler's former mentor Summers, now Harvard's president, shares that skepticism. How, after all, do you measure performance in health care? It turns out that there are lots of ways. People (like me) often assume that the American system, while expensive, is about as effective as possible. That turns out to be wrong. People are prescribed pills for hypertension and don't take them. Diabetics are supposed to monitor their blood sugar and don't. According to a study by the RAND Corporation, people get only 55 percent of the care recommended for them. Doctors themselves are surprisingly inconsistent. Alarmingly, many heart attack patients do not receive beta blockers, inexpensive pills that significantly reduce mortality. Dr. Donald Berwick, a pediatrician obsessed with the shortcomings in health-care quality, has shown that it is possible to improve care rather significantly. Berwick, who runs the Cambridge-based Institute for Healthcare, teamed with the Robert Wood Johnson Foundation for a trial in which six hospitals and one H.M.O. focused on improving overall performance. The results were stunning. Tallahassee Memorial Hospital reduced mortality after heart attacks from 12 percent to 6 percent in two years. It also lowered mortality for strokes by 41 percent and for pneumonia by 32 percent. The improved cardiac performance was a result of systematically administering beta blockers and aspirin, making sure EKG's arrived promptly and prodding the emergency-room doctor and the cardiologist to be in closer touch. These procedures ''were being done'' before the project began, says Winnie Schmeling, an administrator at Tallahassee Memorial. ''They just weren't being done every time.'' According to Berwick, Tallahassee's experience is common. ''Hospitals are out to save lives, but they won't necessarily track survival rates, or compare themselves to others, or think about what they could be doing better,'' he says. There is an aphorism for such behavior in the business world: ''You manage what you measure.'' If doctors measure how long it takes to deliver an EKG, then EKG's are delivered faster. America's fee-for-service system does not require doctors to measure. It rewards them for each instance of delivered ''care,'' Cutler notes, but not necessarily for the end result -- for ''health.'' This is especially true for chronic patients, whose well-being depends on following a long-term regimen of care. Diabetics, for instance, should receive yearly eye exams, regularly monitor blood sugar and cholesterol and take other steps to avoid problematic (and expensive) complications. ''Doctors say, 'You really should get your eyes examined,''' Cutler notes. ''There is no follow-up. Every doctor you talk to says: 'I know we don't do a good job on that. We don't get paid for it.' My way, we would pay them.'' How would ''paying for performance'' work? In the late 90's, HealthPartners, a not-for-profit health plan in Minneapolis with 630,000 members, instituted a bonus system to providers. It paid doctors extra if their diabetic patients got blood sugar and cholesterol below certain levels, ceased smoking and took aspirin daily. In 1996, 5 percent of patients met all criteria. By 2003, 17 percent did. Similar gains were registered with heart patients. ''These clinics are trying to provide quality care,'' says Dr. George Isham, the plan's medical director. ''What we're doing is putting a measurement on it.'' In 2003, the plan awarded a total of $9 million to doctors on merit. But was it worth it? At Isham's request, Cutler and a team of colleagues analyzed the economic payoff. They found that the program reaped huge rewards. It cost $330 a patient and was expected to save roughly $30,000 over each patient's life. While the analysis is not precise, Cutler wrote, it ''illustrates a general point that professionals in health care have known intuitively for some time: . . . comprehensive disease-management programs are clearly worth the investment.'' The rub is that the investment was only marginally worth it for HealthPartners. The gains went to the patients, in the form of better health, and to their employers, who were expected to suffer less absenteeism. HealthPartners did recoup some of its investment, as members were hospitalized less frequently. But some of those people would change jobs and change insurers, so the benefits were largely reaped by someone else. Ultimately, as patients retire, they will be reaped by Medicare. This ''exemplifies some of the problems inherent in our current system,'' Cutler wrote. A program with huge benefits for society (and for patients) offered only a marginal incentive to the health plan to create it. HealthPartners did not have the option of simply raising its rates, because healthy patients would have departed for a cheaper plan. This is why closed-loop systems -- systems in which patients made healthy don't leave -- tend to work best. Kaiser Permanente, the huge health plan based in California, is something of an example. Both insurer and provider, Kaiser pays its doctors a fixed salary regardless of how much (or little) they do. Its doctors also receive a bonus tied to measures of performance. The theory is that its integrated approach will pay off both in terms of patients' health and economically. So far, the approach has shown significant improvement in health and after some missteps has been able to stay competitive (though it is hardly cheap). Other major health plans in the state recently agreed to a similar system of quality bonuses, so California could become something of a closed loop. General Electric is another intriguing case. Despite its supposed fervor for quality, until recently G.E. had been shelling out more than $2 billion a year in health coverage without regard to the quality of care. Robert Galvin set out to change that. In 2000, G.E. and several other companies began a program to reward doctors in certain cities on the basis of quality. Specifically, the companies split with doctors the savings that flowed from better care of diabetes and heart disease. According to G.E., the average cost of caring for diabetics who are properly treated drops by $350 a year, even before factoring in the cost of the long-term complications of leaving the disease untreated. Maybe pay-for-performance won't work for an earache, Galvin allows, ''but we have found a business case for diabetes.'' Clinician groups that hit their quality targets can earn up to $20,000 a year. Predictably, G.E. started with two conditions -- diabetes and heart disease -- that afflict large numbers and for which care guidelines are well established. G.E.'s next experiment was less predictable. Cutler and others (including President Bush) have been pushing the health industry to invest in computers. Many doctors still write prescriptions and keep records manually, and Cutler says that digitizing the health-care system would save considerable administrative expense and improve quality. It would minimize prescription errors, speed paperwork and make a patient's medical history portable. But the big kick is what information technology could do for the doctor's understanding of his own performance. Most doctors' offices have no idea, say, what the average blood pressure is of their patients being treated for heart disease. In fact, most clinics could not tell you how many heart patients they have or how many have been prescribed a particular drug. Cutler envisions a medical world in which doctors routinely get readouts of their patients' blood-pressure levels, insulin, smoking rates -- the lot. This, of course, is how most of the business world already operates. So the G.E. program is paying doctors' offices up to $15,000 a year for investing in, and using, computers. G.E. and other companies have asked RAND to analyze the financial payoff, but in the meantime they decided to kick-start doctors, some of whom have reacted warily to any sort of proposed changes, into the digital age. If you look at why Americans are going to the doctor, it strengthens the economic case for performance goals. Half of the growth in spending is for chronic conditions like asthma, obesity and diabetes. With proper treatment, including preventive care, chronic patients require less intensive care and less hospitalization. In their case, particularly, Cutler argues, quality will pay. One criticism is that pay-for-performance still rewards doctors for doing something. It doesn't motivate them to cut waste -- to not do things. Another is that doctors could game the system, just as C.E.O.'s with performance bonuses can. Nonetheless, McClellan, the Medicare administrator and former Cutler collaborator, is taking a gamble that pay-for-performance will work. Medicare has started half a dozen pilot programs to test various incentives. In one, hospitals scoring in the top 10 percent in a set of quality measures for certain conditions will be given a 2 percent bonus. Medicare is also testing incentives that reward doctors for savings. The American Medical Association is nervous about anything that smacks of encouraging doctors to withhold care (a battle it fought with H.M.O.'s in the 90's), but it appears to be willing to look at schemes that link pay to quality. Medicare hopes that by making providers think about both quality and efficiency, modern doctors might acquire some of the wisdom of those old-time family practitioners who, so we like to recall, had their patients' health uppermost in mind without losing all regard for their pocketbooks. ''Speaking as an economist,'' McClellan says, ''it's clear that doctors respond to incentives.'' Cutler says that Medicare's willingness to experiment is hugely important. Private health plans do not have the clout to force a clinic to purchase software or adopt performance goals. But Medicare is so big that were it to adopt performance targets, it would force every doctor to adjust. ''Medicare could really jump-start'' pay-for-performance, Galvin says. Then H.M.O.'s would surely begin to mimic Medicare and adopt similar targets. Reoriented to managing ''health'' rather than merely costs, H.M.O.'s might again become a useful part of the health-care landscape, Cutler says. Managing care, he says, was a necessary idea that went off the tracks as H.M.O.'s became remote, single-minded cost-control freaks. His models for the future are the progressive organizations (he calls them hippie places) like Kaiser that employ their own doctors, invest in computers and ''engage'' their patients. They manage quality as well as cost. This does sound sort of pie-in-the-sky, but Kaiser and the other California health plans are already paying bonuses to doctors who score high on patient surveys. Just imagine: a doctor paid to make you feel better. Cutler says that the next step is for Medicare to go beyond trials and move from a fee-for-service model to, in part, pay-for-performance. ''If Medicare has to pay more to doctors -- which it will, given current projections -- don't raise fees across the board,'' he explains. ''Set up a bonus fund that goes to M.D.'s who follow guidelines or have the best measures of outcome.'' Similarly, Medicare could pay more for operations that are clearly indicated, less for procedures (or drugs) that seem discretionary. By such steps, Medicare would come to resemble a large, progressive H.M.O. All this would ease the way to Cutler's ultimate goal, which would be to abolish the distinction between Medicare and private plans. That America has a separate plan for seniors is an accident of history: it was a compromise adopted in the 60's when business and the American Medical Association lobbied to defeat universal coverage. Many corporations, however, are now quite eager for the government to resolve the mess. And the present hodgepodge system (or nonsystem) simply has no logic to support it. As former Senator Bob Kerrey testified in 2002, ''There are six main ways a resident of the United States can become eligible for insurance'': wait until he is 65, demonstrate that he is disabled, ''get blown up in a war,'' prove he is poor and ''promise to remain poor,'' work for the federal government or find a job with an employer who offers insurance. Those who fall through the cracks get only half as much care as people with insurance. To make coverage universal, Cutler advocates a $6,000 credit for poor families (and less, on a sliding scale, for others, tapering off to a small credit for people earning $50,000 and up). The credits would be redeemable as a sort of health-insurance voucher. Significantly, Cutler would extend credits to everyone -- even to people who are covered now. Many employers, for competitive reasons, would still offer coverage, but access to care would no longer depend on either employment status or age. Vouchers are a leap for a Democrat, but the idea is popular with conservatives. Bush has also proposed tax credits, though on a smaller scale and for only the uninsured. Stuart Butler of the Heritage Foundation prefers Cutler's universal model. Butler points out that the government already subsidizes people in corporate plans, who do not have to declare their employers' contributions as income. This is a huge break: it costs the United States Treasury more than the mortgage deduction. It is also distributed, illogically, only to people whose employers provide a subsidy. As Cutler declared in his book, ''Health insurance is not something that is made better by tying it to employment.'' Even the A.M.A. has come around and favors having the government finance universal access. Cutler's idea is to preserve the diversity of America's system while subsidizing people's access to it -- to let the G.E.'s and the HealthPartners of the world, and also the Mercks, continue to innovate. Cutler says that under his scheme, the government might spend an additional $100 billion a year. Some of that would represent new spending for people who previously did not have insurance; some would represent a transfer to the government of costs now borne by others -- employers, or hospitals that provide charity care. That's a big number, but, to keep it in perspective, spending for Medicare and Medicaid currently totals just over $500 billion. More problematic is that Cutler's plan would seem not to brake the projected future escalation of spending. By 2040, according to various projections, that spending could rise from its present $1.8 trillion to something like $3 trillion -- that is, to 20 percent of G.D.P. or conceivably 25 percent. This is why so much attention is focused on cost. According to Henry Aaron of the Brookings Institution, ''We can't continue to provide all care for all people.'' Cutler's answer to these fears is not exactly cavalier, though some might find it so. If we institute a more results-oriented, and a more health-conscious, system, our dollars will buy us better care and probably cheaper care. By emphasizing prevention and effective treatments for the chronically ill, we might also reduce the rate at which spending grows. We'll still consume more health care -- more ''good stuff,'' in Cutler's trademark colloquialism. But the drive to keep spending down will forever be challenged by technology's efforts to overcome it. If it turns out that gene therapy delivers a cure for cancer, and if that turns out to be something that most Americans want, we should be prepared to pay for it and indeed to tax for it, Cutler says. Spending a fifth, even a quarter, of our resources on life-enhancing and life-prolonging miracles would not be the worst of fates.

Subject: Data cowboy steal yer money - cspn3 10am
From: johnny5
To: All
Date Posted: Mon, Mar 14, 2005 at 19:25:55 (EST)
Email Address: johnny5@yahoo.com

Message:
10:00 am on CSPAN3 or on the web if you don't have cable. 2:00 (est.) LIVE Senate Committee Identity Theft Banking, Housing and Urban Affairs Paul S. Sarbanes , D-MD Richard C. Shelby , R-AL The beginning and end of this live program may be earlier or later than the scheduled times. Senate Committee Identity Theft Banking, Housing and Urban Affairs Washington, District of Columbia (United States) ID: 185919 - 03/15/2005 - 2:00 - No Sale Sarbanes, Paul S., U.S. Senator, D-MD Shelby, Richard C., U.S. Senator, R-AL The Senate Banking, Housing and Urban Affairs Committee will hold a hearing on identity theft, the security of sensitive consumer information, and maintaining personal information on large computer databases.

Subject: The MATRIX has you Jennifer - GUILTY
From: johnny5
To: All
Date Posted: Mon, Mar 14, 2005 at 18:51:45 (EST)
Email Address: johnny5@yahoo.com

Message:
This guy calls them idiots, but he is the one with egg on his face. Now the computer can convict me with faulty algorithms - oh great! http://www.palmbeachpost.com/business/content/business/epaper/2005/03/12/a1f_asher_0312.html Data broker vanguard defends its technology Hank Asher says the system does far more good than harm. By STEPHEN POUNDS Palm Beach Post Staff Writer Saturday, March 12, 2005 Hank Asher has been called a lot of things, but trailblazer isn't one of them. Truth is, the blunt, gruff and combative software programmer extraordinaire-turned-multimillionaire inventor was front and center in the data brokerage industry when it was formed in the early 1990s. He founded DBT Online in 1992 and Seisint in 1998 in Boca Raton, creating two cogs in the nation's growing data broker industry. Now they are owned by Georgia-based ChoicePoint and British publishing giant Reed Elsevier Plc, respectively. Asher, 53, with homes in Boca Raton and Naples, is the thread that connects these two data giants that identity thieves have recently infiltrated. The digital consumer information breaches at ChoicePoint and Seisint in the past month compromised the personal records of 175,000 Americans, putting data aggregators on the defensive. He took a paternalistic view Friday in defending the companies, saying they do far more good than bad and calling the hackers 'idiots.' 'Since they leave an enormous trail of electronic fingerprints,' he said, 'They are certain to be caught.' Asher was on his yacht this week north of the Dominican Republic with a satellite phone with poor reception as his only form of communication. He responded to e-mail questions through his attorney, Derek Dubner. Asher doubted that the problem at either company was the result of inadequate internal technology. 'ChoicePoint simply allowed fictitious customers to gain accounts,' he said. 'The Seisint problem is much different, where legitimate customers allowed their user IDs and passwords to be compromised.' Using the recent data breaches as a flash point, Congress is talking about regulating data brokers as the number of identity thefts in the U.S. has grown to more than 9 million a year. If the industry must be regulated, Asher said, beef up laws against the high-tech thieves and not the companies. He compared the problem with that of an automobile driven by a drunken driver. 'The solution is to sanction the drunken driver not the automobile,' he said. 'These systems are used millions of times a day to protect commerce, our identities and our country.' Asher now pours his time and money — at least $10 million last year — into a cancer research nonprofit, the JARI Research Foundation, an initiative inspired by his sister who is battling cancer of the blood. He stepped aside from running DBT and Seisint after revelations of his short-lived days as a drug smuggler in the early 1980s scared off customers. His notorious earlier life has never stopped him from helping law enforcement. Asher came up with the idea for a computer system known as Matrix, short for Multistate Anti-Terrorism Information Exchange, within 48 hours of the Sept. 11 attacks to help snare terrorists and criminals. Before launching it, Asher gave Florida and U.S. authorities the names of 120,000 people who showed a statistical likelihood of being terrorists. It sparked some investigations and arrests. But it also brought a torrent of criticism of Asher. Still, Asher worries that it will take another major terrorist attack before computer programs like Matrix are fully embraced. Although Asher has taken his share of heat, he has many supporters. Dubner described the inventor as a colorful, creative nonstop worker unafraid to shock people. Beth Givens, director of the nonprofit Privacy Rights Clearinghouse in San Diego, called him 'brilliant.' 'He has developed two incredible data products,' Givens said. But he also is 'the ultimate data cowboy.' Givens questioned whether the early corporate culture at both DBT and Seisint allowed them to be 'not very careful about who they let in the door' as clients paying for access to sensitive online files.

Subject: Nonsense
From: Ari
To: johnny5
Date Posted: Mon, Mar 14, 2005 at 19:39:49 (EST)
Email Address: Not Provided

Message:
This article is incomprehensible, and has nothing at all to do with the company mentioned. Why mention a fellow board poster who has always been helpful?

Subject: Blue pills for you! hehe
From: johnny5
To: Ari
Date Posted: Mon, Mar 14, 2005 at 19:43:19 (EST)
Email Address: johnny5@yahoo.com

Message:
This article has to do with identity theft - if you will look down a few posts I had a lengthy dicussion with Jennifer about that issue. Further into the article they talk about the MATRIX system by this same guy that takes innocent peoples names and gives them to law enforcement - if you had watched a movie called - THE MATRIX - Morpheus says to NEO the hero - the MATRIX has you - and agent smith 'the law' came to get the poor computer hacker and hurt him - my title was meant to be humorous that now a computer can take innocent people and provide their data to lawmen to stalk us poor citizens based on quants and stats - the guy that programmed this system used to run with drug runners and has a shady past - this guy is one of the key people in the data brokerage industry - draw your own conclusions.

Subject: Before you all go crazy again
From: johnny5
To: johnny5
Date Posted: Mon, Mar 14, 2005 at 19:59:30 (EST)
Email Address: johnny5@yahoo.com

Message:
The title was not an ATTACK on jennifer - it was simply to futher illustrate her data could be in a computer somewhere - it could be stolen - or it could be used to profile her as a terrorist and convict her as GUILTY without any PROOF - therefore the matrix has you jennifer - GUILTY even though I think she is a great person and helpful - the computer might not - this was meant to frown on the intrusion of our privacy by an ex drug smuggler - not calling jennifer GUILTY of anything - I fear context is easily lost. I think this smells rotten in denmark that our data brokerage industry - probably one of THE MOST IMPORTANT security issues in all of our lives has such a person so central to it's core and such a person with such ethics as to invade mine and your's and jennifers privacy with statistical measurements of our guilt passed on to Agent Smiths. I am not your enemy Ari or Jennifers either - I am your friend - that computer doesn't have a heart though, and those hungry hackers in russia don't care if you go broke and lose all your money in an electronic heist.

Subject: Some movies to watch
From: johnny5
To: johnny5
Date Posted: Mon, Mar 14, 2005 at 20:32:29 (EST)
Email Address: johnny5@yahoo.com

Message:
The Matrix, Blade Runner, Code 46, 1984, Total Recall, ExistenZ, Dark City, Johnny Mnemonic, Virtuosity, Tron, Strange Days, Lawnmower Man, Brainstorm, Minority Report, Dreamscape, I Robot, AI, Equilibrium, and then watch some Blake's 7 and maybe you will have the same nightmares I have - HAHA! Maybe throw in a little sprinkle of Usual Suspects and LA confidential and you will cower in fear like johnny at all these thoughts floating around in film-makers heads!!

Subject: Re: Before you all go crazy again
From: Ari
To: johnny5
Date Posted: Mon, Mar 14, 2005 at 20:09:16 (EST)
Email Address: Not Provided

Message:
I understand. I never saw the film.

Subject: Re: The MATRIX has you Jennifer - GUILTY
From: johnny5
To: johnny5
Date Posted: Mon, Mar 14, 2005 at 18:58:55 (EST)
Email Address: johnny5@yahoo.com

Message:
Red pills and blue pills, I will take them both - further into the rabbit hole we go. http://www.palmbeachpost.com/business/content/business/epaper/2005/03/12/a1f_hedge_0312.html Hedge fund virtually bare All that may be left of KL Financial's assets – provided by many Palm Beach investors – is about $1.5 million. By DAVID SEDORE Palm Beach Post Staff Writer Saturday, March 12, 2005 There was more bad news Friday for the many rich Palm Beach investors who had put money in the West Palm Beach hedge fund firm that abruptly closed last week after federal authorities raided its offices. After the Securities and Exchange Commission obtained a federal court order freezing the assets of KL Financial and its principals, the SEC thought there was at least $11 million of assets preserved. The SEC feared at least $70 million of investors' money was gone, and alleged KL Financial engaged in a 'massive hedge fund fraud' that claimed huge profits while actually losing investor money. During a conference call with investors and their lawyers Friday, Guy Lewis, the court-appointed overseer of the money management firm, said $9 million of the $11 million was drained from a KL Financial account held with Penson Financial Services in Dallas. That leaves just $1.5 million in a $2 million account the investment firm held at Bank of America. Lewis said $500,000 from that bank account was pledged as collateral for KL Financial's lease on its former 17th-floor offices in the Esperante building in downtown West Palm Beach. While Lewis and his Miami attorney partner, Mike Tein, said they would go after the money in the Penson account if it was wrongly taken, the news that it was gone illustrates the difficulty authorities face in making the hedge fund's investors anywhere near whole. About 300 KL Financial investors lost somewhere between $81 million and $300 million as a result of the firm's high-risk securities trading. The investment firm was based here and had offices in San Francisco and Irvine, Calif. 'The one thing we can promise is aggressive action,' said Lewis, a former U.S. attorney for South Florida. Penson Financial is a brokerage firm that cleared investment trades for KL Financial. When the SEC moved to shut down the hedge fund firm and freeze its assets on March 3, it found about $11 million in two accounts, including about $9 million at Penson. Tein said Penson officials now say the money was held in a margin account — meaning it was borrowed by KL Financial and owed to the brokerage. When Penson liquidated the account, it had a zero balance. Tein said it's possible that Penson's move to liquidate the account violated the federal court order temporarily freezing KL Financial's assets. Lewis will interview Penson officials under oath next week. Penson executives Phil Pendergraft and Daniel Son were unavailable for comment Friday. Meanwhile, Tein said KL Financial principal John Kim, a Jupiter resident, is not cooperating with efforts to recover assets. During a deposition Friday, Kim declined to answer questions regarding assets, citing his Fifth Amendment right to remain silent. The firm's other principals, Won Sok Lee and Yung Kim, John Kim's brother, have fled the area and probably the country. Tein also said Lewis' office is working with federal authorities who are continuing a probe of KL Financial's trading activity and its operators. Where did the money go - they thought a short of GOOG at 200 was a good bet - I would have to agree - but that would have been the wrong bet apparently.

Subject: Who will you call if you have no mouth
From: johnny5
To: johnny5
Date Posted: Mon, Mar 14, 2005 at 19:07:02 (EST)
Email Address: johnny5@yahoo.com

Message:
I am going to make sure and pray that NEO comes to save us - that Agent Smith is a wicked dude! http://www.palmbeachpost.com/business/content/business/epaper/2005/03/10/c1a_idtheft_0310.html Hackers swipe ID data on 32,000 from Boca firm Thieves used stolen passwords to infiltrate the database of Seisint in the latest major data breach. By STEPHEN POUNDS Palm Beach Post Staff Writer Thursday, March 10, 2005 For the second time in less than a month, a large national data broker has revealed that thieves stole the identities and private information of thousands of Americans. Reed Elsevier Plc, the British owner of information company LexisNexis, disclosed Wednesday that hackers slipped past computer security and stole the passwords of its business customers in February to break into the computer database at its Seisint division in Boca Raton and, in turn, swiped the personal information of 32,000 Americans. Have you been a victim? If you have been the victim of identity theft in the Seisint, ChoicePoint or any other case, please contact Post reporter Stephen Pounds at (561) 820-4412 or by e-mail at stephen_pounds@pbpost.com and tell your story. What Seisint is doing Steps Seisint's owner is taking for consumers whose private information was stolen: • Notifying in the next few days those whose personal information was stolen; they will be told what action to take and given a toll-free telephone number to call if they have questions. • Conducting credit-report monitoring for all 32,000 victims to catch any attempts to fraudulently use their personal data. • Providing credit counseling in cases when a person's identification is used for illicit purposes. The Seisint computer breach was detected when employees found abnormal billing activity by some of its business customers. After sneaking into the system, the thieves peeled off with names and addresses, and in some cases Social Security and driver license numbers. No personal credit or medical records were pilfered. Seisint stores tens of billions of personal records on millions of Americans in Boca. That personal information is sold to corporations, individuals and government entities for employee background checks, debt collection and other purposes. After learning of the breach, LexisNexis notified the Secret Service, which investigates counterfeiting and cyber crime. The company plans to notify individuals by mail over the next few days that their personal data was stolen. Residents in all 50 states and Puerto Rico are affected, but the company wouldn't provide a state-by-state count. The computer break-in marked the second time in a month that it was revealed thieves made a mockery of the intense security measures at a large U.S. data broker, and both companies have major computer centers in Boca Raton. Earlier in February, ChoicePoint, an information giant based in Alpharetta, Ga., with 300 to 400 employees here, acknowledged that thieves had taken sensitive data on 145,000 people, including 10,000 Floridians. In that instance, 750 people around the country were defrauded when their personal information was used for illicit purposes. So far, no identity fraud is known to have occurred because of the Seisint breach. But LexisNexis will provide each of the 32,000 individuals affected with ongoing credit report monitoring. And in cases in which a person's identity is used fraudulently, the company will offer counseling on how to repair the person's credit history. 'There was no medical information, no financial information and no credit histories taken,' said Jim Peck, chief executive of LexisNexis' risk management division. 'As far as the investigation is concerned, a group of people in the company is working with law enforcement . . . obviously those in Boca are included.' Peck said the incidents at ChoicePoint and Seisint were different. With ChoicePoint, thieves used stolen identifications to set up bogus businesses, such as check-cashing and debt-collection companies, signed the businesses up as ChoicePoint customers and then accessed its records. With Seisint, they just stole customer identification numbers to enter the computer database. Still, Peck conceded that the information heists, taken together, make it more likely that Congress and the states will toughen regulations on the data brokerage industry. 'The issue is obviously heating up because of these incidents,' Peck said. 'We are going to try to understand all sides . . . to strike the right balance between regulation and providing these kinds of services.' Ted Julian, vice president of marketing at Application Security Inc. in New York, which writes software for database security, said computer hackers are looking for bigger and better targets. 'The short answer is hackers are growing up,' Julian said. 'They used to brag about how many (computer) networks they own. Now they're looking at quality over quantity. There's more money in it.' In Florida, state Sen. Dave Aronberg, D-Greenacres, pledged last week to amend a bill that would make it a crime for telemarketers to misrepresent themselves to unwitting consumers, collect data from them and use that information or sell it to other telemarketers. California is the only state in the nation with such protection. Aronberg plans to amend the bill to force companies such as LexisNexis and ChoicePoint to immediately disclose when an individual's personal information is stolen. LexisNexis learned its own computer database system had been mugged in February as it blended Seisint into its risk management unit. Reed Elsevier bought Seisint last July for $775 million and folded it into LexisNexis. Last year Seisint made national headlines over its controversial criminal-information project known as Matrix. The firm gave U.S. and Florida authorities the names of 120,000 people who showed a statistical likelihood of being terrorists, sparking some investigations and arrests. Matrix, which is short for Multistate Anti-Terrorism Information Exchange, combined state records and data culled by Seisint to give law enforcement investigators fast access to information on crime and terrorism suspects. It was launched in 2002. Because the system included information on innocent people as well as known criminals, Matrix drew objections from privacy groups. Millionaire Hank Asher founded Seisint and was the brains behind developing Matrix. Asher stepped down from Seisint's board of directors in 2003 after revelations of his past ties to drug smugglers. Asher also started DTB Online in Boca Raton, a firm that ChoicePoint purchased in 2000. These digital cowboys can't stop all the liquidity problems this is going to cause - if johnny5 is bidding on a gold coin on ebay and 400 hackers with fake credit card accounts bid up the coin - inflation is gonna kill johnny.

Subject: Arguing Stocks and Bonds
From: Terri
To: All
Date Posted: Mon, Mar 14, 2005 at 18:26:11 (EST)
Email Address: Not Provided

Message:
Robert Shiller's projection of real growth in stocks over the coming decade is 4.6%. This is a conservative projection to which I could easily agree. With current dividends on the S&P Stock Index of 1.6% after Vanguard costs, and stock buybacks worth about 1%, all that is needed is economic growth of 2% to get 4.6% returns in stocks. Then, there is going to be a pronounced relative problem for bond holders over the coming decade. Investment grade bonds should return about 2.1% given current after Vanguard cost yields. That gives stocks a 2.5% annual edge in real returns. A potential doubling of the returns to an asset class means bond holders may well be at a serious disadvantage. Note to mention that bond are already tax disadvantaged.

Subject: No energy
From: johnny5
To: Terri
Date Posted: Mon, Mar 14, 2005 at 18:46:12 (EST)
Email Address: johnny5@yahoo.com

Message:
So buying the tax free vanguard bond funds would not be a prudent strategy? All my relatives live in florida and I see vanguard has a FL LT Tax-Exempt Investor fund, I signed up today for an account, and wanted to get into the vangaurd energy fund but it said it was closed.

Subject: Bonds and Energy
From: Terri
To: johnny5
Date Posted: Mon, Mar 14, 2005 at 18:55:09 (EST)
Email Address: Not Provided

Message:
These are just arguments with myself. For a conservative household in a high tax bracket, tax free bonds make perfect sense even if they trail another asset class in return. Vanguard closes funds with no warning when asset flows threaten to limit investment possibilities for the fund managers. Money is flowing to energy. When the energy fund flow eases, the fund will open. This is all done to protect shareholders. However Vanguard has an energy index, and index funds will not close since allocation of funds is no problem.

Subject: Energy Viper
From: johnny5
To: Terri
Date Posted: Mon, Mar 14, 2005 at 19:13:14 (EST)
Email Address: johnny5@yahoo.com

Message:
The energy fund was closed, but the energy viper may not have been, I didn't check, should I get the energy viper instead of the energy fund if I want energy exposure, are there benefits to the vangaurd funds versus the vangaurd vipers?

Subject: Imagine Life With no Butterflies
From: Emma
To: All
Date Posted: Mon, Mar 14, 2005 at 16:45:29 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/14/international/americas/14mexico.html?8hpib=&pagewanted=all&position= Chain Saw Thins Flocks of Migrants on Gold Wings By JAMES C. McKINLEY Jr. CONTEPEC, Mexico - Homero Aridjis, a poet and naturalist, can remember years when monarch butterflies filled the streets here in his hometown like a living torrent of orange and black and stayed all winter on the fir-covered mountain rising above the village. Not this year. The colony of butterflies that arrived here in November was tiny and retreated up the mountain, as far away as possible from the lower slopes where loggers have thinned or destroyed the forest the butterflies depend on. 'There used to be rivers of butterflies, but now there are years when there are no butterflies at all,' Mr. Aridjis said as he climbed the mountain of his youth recently. 'This is a village full of ghosts, not of people, but of nature, a paradise lost.' The tourists still come, but there is not as much for them to see. This is a small town of 10,000, like many in Mexico, dominated by a church and a school in rolling fields at the foot of Cerro Altamirano. The country people here still work on their small farms, but in recent decades the town's adobe houses have been replaced by uglier cinderblock buildings, and rusting automobiles outnumber burros and horses. Not only are there comparatively few monarchs in Contepec, but the numbers that came to weather the winter at five other forest sanctuaries in central Mexico also dropped sharply this year. Two storms killed most of the butterflies spending winter here in 2003 and 2004. But these reproductively hardy insects have bounced back before. In 2002, a storm killed about 80 percent of wintering butterflies, but the next summer, they found perfect breeding conditions in the central United States and southern Canada. Last summer, though, cold and wet weather in the American corn belt kept the diminished population from regrouping. The number arriving this winter was the smallest since Mexico and the World Wildlife Fund began keeping records in the 1970's, down three-quarters from the winter before, the wildlife fund and independent biologists said. Biologists and nature lovers say bad weather is not the whole story. They warn that logging in Mexico and herbicides in the United States have endangered these almost miraculously migratory insects, which flutter thousands of miles. Hardier genetically altered corn and soybean crops in the United States and Canada, in the breadbasket areas that are the monarch's main summer conjugal grounds, have enabled farmers to use stronger herbicides to eliminate weeds. That has drastically depleted the supply of flowers on which the butterflies feed, as well as common milkweed, on which the monarch lays its eggs in the spring and summer and on which its larvae feed, several biologists say. The drop in butterfly counts is staggering. In 2004, at a monitoring site in Cape May, N.J., for instance, scientists registered the lowest number of butterflies heading to Mexico since the program began in 1991, according to scientists in the field. Similar results were found in Virginia. Scientists from the University of Minnesota who have been counting larvae in the Midwest since 1997 recorded their lowest numbers. Some environmentalists say that preventing permanent devastation of the monarch population might require concerted action by Mexico, the United States and Canada, though these countries have not put the issue on their foreign affairs agendas. 'We have a trinational crisis,' said Mr. Aridjis, who helped set up sanctuaries in Michoacán State for the butterflies in the 1980's. In August, as the days shorten, the last monarch generation hatched in the summer stops reproducing and goes into a sort of sexual hibernation. The monarchs fly south to the forested hills in Michoacán and the State of Mexico, where their ancestors have spent winter for millennia. There, they find the perfect balance of coolness and humidity to remain alive for several months, without laying eggs. In February, they mate. Finally, in March, they return to the southern United States to lay their fertilized eggs and die. In Mexico, illegal logging in these protected forests has shrunk the monarchs' habitat and forced the insects to higher elevations, where they are vulnerable to the cold. The government protects the forests with armed federal agents during winter, but large logging operations have continued to eat away at the dense stands of Oyamel fir trees here. Satellite photos compiled by United States scientists show that vast numbers of trees in the 140,000-acre Monarch Butterfly Biosphere Reserve , 75 miles east of Mexico City, have been logged and carted out, often by armed gangs who pay off the authorities, people tracking the fate of the butterflies say. The northeast face of Cerro Pelón, one of the mountains in the core of the reserve and a former winter home of butterflies, is stripped of trees now. 'The deforestation is increasing per year in each period we studied,' said Daniel A. Slayback, a United States scientist studying the butterflies who has compared satellite photos from 1976 through 2004. 'Whatever measures the Mexicans are taking, they are totally ineffective.' A group of 11 biologists who study the monarch concluded in a paper distributed Feb. 17, 'Monarchs have proven resilient to many environmental stresses but the ongoing deterioration and loss of habitat in Mexico, the United States and Canada has the potential to drive the population below a level from which it can recover.' Lincoln P. Brower, a biologist at Sweet Briar College in Virginia who is one of the world's foremost Monarch specialists, said the population had been cut so severely that one more bad storm over the winter might have finished it. 'I would say the monarch is in a precarious situation now,' he said. One reason is poverty. Martin Uilshes Maya, 35, a farmer from Contepec who loves the butterflies, is typical of many people in the region. He said he had 10 acres of land to feed his wife and two children. He grows enough corn and wheat to make about $3,600 a year, but the need for firewood sometimes drives him and his neighbors into the forest. 'Clearly, we are destroying the forest, but that is what life is giving us,' he said sadly. 'It's a very beautiful phenomenon, the butterflies, that gives us so much life.' 'But,' he said, 'we don't have any way to make money off tourism.'

Subject: Conservative Investing
From: Terri
To: All
Date Posted: Mon, Mar 14, 2005 at 12:05:55 (EST)
Email Address: Not Provided

Message:
There is no reason for an investor to take significant risks, especially an investor who has assets that are sufficient to live on comfortably or who is trying to conserve assets. We can always choose to conserve assets. That seems to me the beauty of bond funds with reasonably constant durations. Bond yields rise and fall as investors change projections of inflation. Over time, yields will adjust and remain higher than inflation. An investment grade bond portfolio, whether taxable or tax free, can be used to any extent. The Vanguard Intermediate Term Bond Index has a yield of about 4.5% and a 5 year duration. The bonds are extrmely high in quality and the portfolio so diverse that credit risk is of no account. For each hundred thousand dollars invest in the fund the return will be about 4,500 dollars a year for the next five years. A large asset base in such a fund will provide a nice secure income, and the yield will gradually adjust to any price change for the fund. Though I find no reason not to included stocks in a portfolio, there is no reason why bonds can not be the focus.

Subject: Re: Conservative Investing
From: johnny5
To: Terri
Date Posted: Mon, Mar 14, 2005 at 18:37:56 (EST)
Email Address: johnny5@yahoo.com

Message:
Secretary Peterson recommended International Bond funds with low expenses - does the Vanguard intermediate bond fund invest internationally or just in american bonds?

Subject: Re: Conservative Investing
From: Terri
To: johnny5
Date Posted: Mon, Mar 14, 2005 at 20:56:35 (EST)
Email Address: Not Provided

Message:
There is no international bond exposure at Vanguard. John Bogel believed international stocks were a better long term balance in a portfolio than international bonds.

Subject: Bubbles - whose at fault?
From: Pete Weis
To: All
Date Posted: Mon, Mar 14, 2005 at 10:14:11 (EST)
Email Address: Not Provided

Message:
Certainly all those who participate in them. But if our economy is to survive don't our central bankers and our political leaders have a need to be pro-active and forward looking? Will our economy and the stock markets survive a bursting of a housing bubble which is now the primary boost to consumption in the absence of overall wage increases? From MSN Money: The Fed sees bubbles -- and keeps them secret In public, the Federal Reserve says there's no housing bubble. But the Fed also said there was no stock market bubble in 1999. Behind closed doors, the governors knew there was. By Bill Fleckenstein Our Fed chairman has argued (most recently last October, in a speech to America’s Community Bankers Annual Convention) that for a variety of reasons, real estate cannot experience a bubble. Yet anyone with a pulse can see wild speculation taking place all around them. At the height of the stock-market bubble in the first quarter of 2000, it was becoming progressively more difficult for me to adequately describe (in my daily column) the market action. So, in an attempt to capture the mood of the day, I began to share stories of insane behavior that were being e-mailed to me by regular readers. I dubbed this series 'The Mania Chronicles,' and you'll find excerpts from it in Chapter 3 of the Archives section of my Web site. (Readers of the Contrarian Chronicles can access the site for the next week by using the password/username: mania/mania.) The kind of maniacal behavior that we saw then toward stocks and which we are seeing now in real estate tends to come at the end of a speculative mania. It is almost always coincident with rising supply, which helps to satiate the inflated demand. Banks and insurers check your credit. So should you. As I have pointed out, the true danger in the real-estate bubble is that folks are often speculating with more than 100% leverage. When it all ends (and though we don't have a timeline for exactly when that will be), the banking system and other financial entities will be left with the bad assets, which will severely impact the economy. Condominium-mania So, even though I offer up the following vignette in a somewhat lighthearted way, everyone should be aware that the current insanity it demonstrates is very dangerous. Each e-mail I have received reveals a variety of preposterous assumptions made by the people depicted, but what the vignettes share is: The belief that one can't lose. Incredible greed. The absence of any common sense. 'In Chicago this weekend, there was an apartment conversion to condos where 200 people slept out overnight for a chance to be one of the first people to have a chance at buying a condo. I personally knew five people who stayed out all night, and these people were only buying on spec, with the thought of flipping the property in the next year or so. They believe it is impossible to lose money on this deal. It reminded me of when everybody would line up at stock-quote machines to check all their winning stocks.' Truth outed by a Fed transcript Today's housing bubble is a consequence of policies designed to ameliorate the effects of the bursting of the stock-market bubble. All long-term readers know that I place the blame for the stock and real-estate bubbles squarely on Alan Greenspan and his easy-money comrades at the Fed. Consequently, it was with interest that I read 'Fed Officials Worried in 1999 About Managing Stock 'Bubble'' in last Monday's Wall Street Journal. The article discusses the fact that in 1999, Fed officials were aware of the stock-market bubble, even though they claimed before and after not to have known. Related news and commentary on MSN Money • Housing bubble is real, report says • Don’t get trapped in a housing bubble • Home prices still headed high in 2005 • Housing mania will end in tears • The housing bubble doesn’t add up Since those days, I have been waiting to see the contents of the 1999 minutes, which are released with a five-year lag, to learn what the Fed was really saying, as opposed to what it said in public. With the Journal story serving as a reminder, I went to the Federal Reserve's Web site to review the just-released December 1999 Federal Open Market Committee minutes. I was shocked by what I found. Lone wolf amidst bull bankers In an introductory presentation to the FOMC, Fed economist Mike Prell noted the lunacy as follows: 'I refer to the incredible run-up in 'tech' and e-commerce stocks, some which have entered the big-cap realm without ever earning a buck. To illustrate the speculative character of the market, let me cite an excerpt from a recent IPO prospectus: 'We incurred losses of $14.5 million in fiscal 1999, primarily due to expansion of our operations, and we had an accumulated deficit of $15 million as of July 31, 1999. We expect to continue to incur significant . . . expenses, particularly as a result of expanding our direct sales force. . . . We do not expect to generate sufficient revenues to achieve profitability and, therefore, we expect to continue to incur net losses for at least the foreseeable future. If we do achieve profitability, we may not be able to sustain it.' 'Based on these prospects, the VA Linux IPO recorded a first-day price gain of about 700% and has a market cap of roughly $9 billion. Not bad for a company that some analysts say has no hold on any significant technology. The warning language I’ve just read is at least an improvement in disclosure compared to the classic prospectus of the South Sea Bubble era. . . . 'But, I wonder whether the spirit of the times isn't becoming similar to that of the earlier period. Among other things, it may be noteworthy that the tech stocks have done so well of late in the face of rising interest rates. Earlier this year, those stocks supposedly were damaged when rates rose, because, people said, quite logically, that the present values of their distant earnings were greatly affected by the rising discount factor. At this point, those same people are abandoning all efforts at fundamental analysis and talking about momentum as the only thing that matters (and that’s just like right now!). 'If this speculation were occurring on a scale that wasn't lifting the overall market, it might be of concern only for the distortions in resource allocation it might be causing. But it has, in fact, been giving rise to significant gains in household wealth and thereby contributing to the rapid growth of consumer demand -- something reflected in the internal and external saving imbalances that are much discussed in some circles. Whether our assumed 75 basis-point increase in the fed funds rate would be a sufficient shock to halt this financial locomotive is open to question.' (The emphasis is mine.) Failing to follow the bouncing bubble One can quickly see that this particular Fed staffer understood what was going on, although without knowing more of his thoughts or talking to him, I'm not sure if even he comprehended just how misallocated capital was at the time. We must also remember that this was only December 1999, with another 50% rally in the Nasdaq Composite ($COMPX) yet to come. In any case, one might have thought that after such a powerful introduction by Prell, some of the Fed governors might have had their curiosity piqued. But near as I could tell in going through the Q&A that followed his remarks, most of the governors were much more concerned about economic minutiae than the epic bubble they had blown. Y2K was supposedly a concern at the time, though I read with interest that 'bankers around the (Philadelphia Fed) district reported that they believe that Y2K will be a non-event.' Given the concern by some Fed staff members that a bubble was brewing and that certain district reports thought Y2K might be a non-event, one might have thought that a sober band of concerned citizens might have tried to ensure that the liquidity the Fed was forcing into the economy wouldn't be used for more speculation. But, of course, that was not the case. When Greenspan discussed the stock market in passing during the meeting, he said, 'It is only a question of how much of a bubble there is in the process.' In public, he repeatedly said the opposite. (Still denying it was possible to spot one, even after the blow-off of the first quarter of 2000, in a Q&A before Congress in April 2000, he stated: 'That presupposes I know there is a bubble. I don't think we can know there is a bubble until after the fact.') Considering how out-of-control the mania was in 1999, I was struck that this group of clueless buffoons spent nearly half the time (according to the transcript of this meeting) arguing about whether the post-séance communiqué should contain the language 'asymmetric,' 'symmetric' or a little of both, etc., rather than spending any time discussing what their actions had wrought in the stock market and the economy. Al was so pleased with himself in the lead-up to the voting that he opined: 'Having said all that, my view on policy is, if I may reference Governor Kelley's comment about raising his hand and saying present, that I almost think the best way we could have gotten through this period would have been somehow to cancel this meeting. The reason is that markets, as far as I can see, seem to be pretty much where we as a Committee would like them to be.' (The emphasis is mine.) Bouncing from bubble to bubble There you have it: The most incompetent and irresponsible Fed chairman in the history of the world thinks nothing of talking from both sides of his mouth about whether he can identify a bubble. He blows the biggest one in history, claims he didn't know it was happening. And then he bails it out with a housing bubble that he says can't exist because real estate can't experience a bubble. What I'd like to know is, given not just Alan Greenspan's record but also what he says in public (and what we can now see he says behind the public's back), how can this menace to society have any credibility whatsoever? I certainly don't know. I encourage everyone to read through these minutes just to get a flavor for how completely untrustworthy and shallow these people are.

Subject: Bond and Stocks
From: Terri
To: All
Date Posted: Mon, Mar 14, 2005 at 08:34:02 (EST)
Email Address: Not Provided

Message:
Though I believe the bull market in bonds is over, I am not concerned about holding a moderate duration bond fund portfolio through the Federal Reserve tightening cycle. Still, at these low interest rates a reasonably priced stock fund has to be an attractive alternative. The secular bull market in bonds began in 1981, and through the cycles since then interest rates have come down cycle to cycle. We may find a long period of relative stability from here. I could as easily however expect rates to rise or fall from here.

Subject: Building a Bond Portfolio
From: Terri
To: All
Date Posted: Mon, Mar 14, 2005 at 08:06:23 (EST)
Email Address: Not Provided

Message:
Different investors have different perspectives, which is what makes a market at any time. Buying and selling bonds is a complex process and I have nowhere near the knowledge to build and maintain a portfolio of individual bonds. Since Vanguard offers the most credit worthy diverse portfolios of bonds, with controlled durations, with fine fair costs, ease of liquidity, monthly distributions, and various services, I can not imagine why I would build a bond portfolio on my own. Through these last years, I have found person after person regret the difficulty individual bond issues represent for them even and especially during a wonderful bond bull market. I prefer simplicity to complexity in building a bond portfolio. I prefer Vanguard.

Subject: Buying and Selling Bonds
From: Terri
To: All
Date Posted: Mon, Mar 14, 2005 at 06:25:54 (EST)
Email Address: Not Provided

Message:
There is always a range in corporate credit ratings however corporation health in America and Europe is in general excellent. Balance sheets and income statements show excellent health in general. There is no meaningful danger in holding a basket of high grade corporate debt. Buying and selling a basket of bonds on one's own however is most troublesome and requires far more knowledge of the bond market than investors usually have. I have never thought for a moment that I could buy and sell bonds more intelligently or safely than Vanguard. The quality and diversity of portfolios are excellent, the cost is always fair, and I surely could never hope to match any Vanguard investment grade portfolio on my own. The same can be said for tax free and government agency bond portfolios.

Subject: Re: Buying and Selling Bonds
From: johnny5
To: Terri
Date Posted: Mon, Mar 14, 2005 at 06:43:32 (EST)
Email Address: johnny5@yahoo.com

Message:
www.fmsbonds.com - it doesn't get any easier than this and no annual expense ratios - bogle would be proud.

Subject: Corporate bonds risky?
From: Pete Weis
To: All
Date Posted: Mon, Mar 14, 2005 at 00:28:55 (EST)
Email Address: Not Provided

Message:
From the Financial Times: Growing fears credit boom may implode >By Dan Roberts and David Wighton in New York and Peter Thal Larsen in London >Published: March 13 2005 21:42 | Last updated: March 13 2005 21:42 >> Bankruptcy advisers are hiring extra staff amid fears that an end to the global credit boom could spark a surge in business failures in the US and Europe. Unusually loose lending conditions have encouraged record borrowing by speculative-grade companies, with leveraged buy-outs and debt refinancing on both sides of the Atlantic generating more than $100bn of deals in the past eight months. But last week's fall in the price of US Treasury bonds, coinciding with signs that bankers are struggling to complete riskier corporate bond issues, has added to a sense of nervousness in some quarters. Although corporate default rates remain low, some fear the legacy of recent private equity buy-outs and hedge fund investments in distressed debt will be a swath of over-leveraged companies ill-equipped to survive in less benign conditions. PwC, the largest corporate recovery adviser, said it was hiring insolvency specialists in sectors such as retailing, utilities and telecommunications in preparation for the expected fall-out. Scott Bok, president of Greenhill & Co, an investment bank specialising in merger advice and restructuring, also predicts the cycle will end with a lot of companies in trouble. “In many of the deals being done today you can foresee the debt restructurings to come in a year or two,” he said. Last week, the Financial Stability Forum, a group of national and international central banks and regulators, pointed to the levels of liquidity as one of the main risks to the stability of the global financial system. Following a meeting in Tokyo, the FSF said that, according to some of its members, tight credit spreads and low long-term interest rates suggested some in the market might be underpricing risks. It urged banks and investors to monitor their exposures by stress-testing what would happen in the event of a market shock. Chuck Prince, chief executive of Citigroup, said: “The possibility of a liquidity bubble around the world concerns me. A very cautionary thing is that it feels like the world is changing and traditional indices may not give a complete picture.” Some say markets are becoming more nervous. Paul Hsi, a senior analyst at Moody's, said: “There is a little bit more caution in the market right now as some of the weaker credits come up with ‘me-too' offerings and investors take a harder look.” Ian Powell, head of European business recovery for PWC, added: “You only need one of these really big financing deals to go sour and confidence will evaporate very quickly.” However, investors say the market is more aware of the risks than in previous credit cycles and that funds are managing their exposure accordingly. “People are on ‘bubblewatch' since almost every market got burnt in the last five years,” said Stephen Peacher, head of high-yield investment at Putnam, the fund manager. “We know that bond prices are certainly not cheap but, given that default rates are so very low, we feel comfort

Subject: Re: Corporate bonds risky?
From: johnny5
To: Pete Weis
Date Posted: Mon, Mar 14, 2005 at 00:42:43 (EST)
Email Address: johnny5@yahoo.com

Message:
why not get tax free, amt free, non callable AAA insured muni bonds and hold to maturity and be done with all this risk and sleep good Pete? My uncle does not need huge profits, he needs capital preservation and small income - the people we keep talking too never recommend tax free bonds though - why is that? They always want to sell him annuities or funds with high expense ratios.

Subject: Re: Corporate bonds risky?
From: johnny5
To: johnny5
Date Posted: Mon, Mar 14, 2005 at 00:58:20 (EST)
Email Address: johnny5@yahoo.com

Message:
http://www.washingtonpost.com/wp-dyn/articles/A55780-2004Oct22.html Teresa Heinz Kerry released her 2003 income tax Form 1040 the other day, and the right-wing commentariat claims to find her tax situation deeply ironic. On income of over $5 million, she paid federal income taxes of just $627,150, or 12.4 percent. As a Wall Street Journal editorial last Monday put it, this 'means she is paying a lower average rate than nearly all middle-class taxpayers.' More than half of Teresa Kerry's 2003 income was interest from tax-exempt bonds. The Journal hilariously described these on Monday as 'the kind of investments that rich people can afford to hire lawyers and accountants to steer their money into.' And the paper predicted that 'mega-millionaires such as Mrs. Kerry' will avoid her husband's higher taxes through 'tax shelters' like this one, leaving ordinary $200,000 taxpayers to shoulder the burden. In fact, tax-exempt bonds are hardly an exotic tax-avoidance technique requiring lawyers and accountants. Anyone with a hundred bucks can buy into a mutual fund of tax-exempt bonds with a simple call to Fidelity or Charles Schwab. The Wall Street Journal got it precisely wrong: The remarkable thing about Teresa Kerry's tax return is that this fabulously rich woman apparently has most of her income-producing wealth stashed in an utterly mundane and non-exclusive form of investment. The Journal returned to Teresa's taxes on Wednesday, declaring carefully that a 'huge reader response' had been 'helpful in illuminating the issue.' This second bite at the apple begins by noting that Teresa Kerry's investment income is exempt from the Social Security payroll tax. 'This is fine by us,' the editorial says. Next, the editorial concedes that 'millions of other Americans' invest in tax-exempt bonds,' and 'we have nothing against' that either. http://www.sptimes.com/2004/04/16/Columns/Tax_returns_show_Chen.shtml Even Kerry has a second mortgage pete!

Subject: Excellent posts Johnny
From: Pete Weis
To: johnny5
Date Posted: Mon, Mar 14, 2005 at 09:28:47 (EST)
Email Address: Not Provided

Message:
It's interesting to note that some of the wealthiest investors are primarily out of the markets and into the most conservative investments.

Subject: Re: Excellent posts Johnny
From: johnny5
To: Pete Weis
Date Posted: Mon, Mar 14, 2005 at 18:31:59 (EST)
Email Address: johnny5@yahoo.com

Message:
Yah, aren't most of the corporate insiders sitting on the sidelines with cash still? That does it, I have to get my mom to sell her west palm beach house, locking in profits is more important than getting greedy with frothy bubbles. I would rather her lose future profit than current gains.

Subject: Our Currency, Your Problem
From: Emma
To: All
Date Posted: Sun, Mar 13, 2005 at 19:05:59 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/13/magazine/13WWLN.html?pagewanted=all&position= Our Currency, Your Problem By NIALL FERGUSON Every congressman knows that the United States currently runs large ''twin deficits'' on its budget and current accounts. Deficit 1, as we well know, is just the difference between federal tax revenues and expenditures. Deficit 2 is generally less well understood: it's the difference between all that Americans earn from foreigners (mainly from exports, services and investments abroad) and all that they pay out to foreigners (for imports, services and loans). When a government runs a deficit, it can tap public savings by selling bonds. But when the economy as a whole is running a deficit -- when American households are saving next to nothing of their disposable income -- there is no option but to borrow abroad. There was a time when foreign investors were ready and willing to finance the U.S. current account deficit by buying large pieces of corporate America. But that's not the case today. Perhaps the most amazing economic fact of our time is that between 70 and 80 percent of the American economy's vast and continuing borrowing requirement is being met by foreign (mainly Asian) central banks. Let's translate that into political terms. In effect, the Bush administration's combination of tax cuts for the Republican ''base'' and a Global War on Terror is being financed with a multibillion dollar overdraft facility at the People's Bank of China. Without East Asia, your mortgage might well be costing you more. The toys you buy for your kids certainly would. Why are the Chinese monetary authorities so willing to underwrite American profligacy? Not out of altruism. The principal reason is that if they don't keep on buying dollars and dollar-based securities as fast as the Federal Reserve and the U.S. Treasury can print them, the dollar could slide substantially against the Chinese renminbi, much as it has declined against the euro over the past three years. Knowing the importance of the U.S. market to their export industries, the Chinese authorities dread such a dollar slide. The effect would be to raise the price, and hence reduce the appeal, of Chinese goods to American consumers -- and that includes everything from my snowproof hiking boots to the modem on my desk. A fall in exports would almost certainly translate into job losses in China at a time when millions of migrants from the countryside are pouring into the country's manufacturing sector. So when Treasury Secretary John Snow insists that the United States has a ''strong dollar'' policy, what he really means is that the People's Republic of China has a ''weak renminbi'' policy. Sure, this is bad news if you happen to be an American toy manufacturer. But there are three good reasons that the administration is tacitly delighted by the Asian central banks' support. Not only is it keeping the lid on the price of American imports from Asia (a potential source of inflationary pressure). It is also propping up the price of U.S. Treasury bonds; this in turns depresses the yield on those bonds, allowing the federal government to borrow at historically very low rates of interest. Reason No. 3 is that low long-term interest rates keep the Bush recovery jogging along. Sadly, according to a growing number of eminent economists, this arrangement simply cannot last. The dollar pessimists argue that the Asian central banks are already dangerously overexposed both to the dollar and the U.S. bond market. Sooner or later, they have to get out -- at which point the dollar could plunge relative to Asian currencies by as much as a third or two-fifths, and U.S. interest rates could leap upward. (When the South Korean central bank recently appeared to indicate that it was shifting out of dollars, there was indeed a brief run on the U.S. currency -- until the Koreans hastily issued a denial.) Are the pessimists right? The U.S. current account deficit is now within sight of 6 percent of G.D.P., and net external debt stands at around 30 percent. The precipitous economic history of Latin America shows that an external-debt burden in excess of 20 percent of G.D.P. is potentially dangerous. Yet there is one key difference between the United States and the countries south of the Rio Grande. Latin American economies have trouble with their foreign debts because those debts are denominated in foreign currency. The United States' external liabilities, by contrast, are almost entirely denominated in its own currency. It therefore makes more sense to compare the United States with other members of that exclusive club of countries that have produced -- and hence been able to borrow -- in international currencies. The most obvious analogy that springs to mind is the United Kingdom 60 years ago. During the Second World War, Britain financed its wartime deficits partly by borrowing substantial amounts of sterling from the colonies and dominions within her empire. And yet by the mid-1950's, these very substantial debts had largely disappeared. Unfortunately, this was partly because the value of sterling itself fell significantly. Moreover, sterling's decline and fall did not reduce the U.K.'s chronic trade deficit, least of all with respect to manufacturing. On the contrary, British industry declined in tandem with the pound's status as a global currency. And, needless to say, the decline of sterling coincided with Britain's decline as an empire. From an American perspective, all this might seem to suggest worrying parallels. Could our own obligations to foreigners presage not just devaluation but also industrial and imperial decline? Possibly. Yet there are some pretty important differences between 2005 and 1945. The United States is not in nearly as bad an economic mess as postwar Britain, which also owed large sums in dollars to the United States. The American empire is also in much better shape than the British empire was back in 1945. Even the gloomiest pessimists accept that a steep dollar depreciation would inflict more suffering on China and other Asian economies than on the United States. John Snow's counterpart in the Nixon administration once told his European counterparts that ''the dollar is our currency, but your problem.'' Snow could say the same to Asians today. If the dollar fell by a third against the renminbi, according to Nouriel Roubini, an economist at New York University, the People's Bank of China could suffer a capital loss equivalent to 10 percent of China's gross domestic product. For that reason alone, the P.B.O.C. has every reason to carry on printing renminbi in order to buy dollars. Though neither side wants to admit it, today's Sino-American economic relationship has an imperial character. Empires, remember, traditionally collect ''tributes'' from subject peoples. That is how their costs -- in terms of blood and treasure -- can best be justified to the populace back in the imperial capital. Today's ''tribute'' is effectively paid to the American empire by China and other East Asian economies in the form of underpriced exports and low-interest, high-risk loans. How long can the Chinese go on financing America's twin deficits? The answer may be a lot longer than the dollar pessimists expect. After all, this form of tribute is much less humiliating than those exacted by the last Anglophone empire, which occupied China's best ports and took over the country's customs system (partly in order to flood the country with Indian opium). There was no obvious upside to that arrangement for the Chinese; the growth rate of per capita G.D.P. was probably negative in that era, compared with 8 or 9 percent a year since 1990. Meanwhile, the United States may be discovering what the British found in their imperial heyday. If you are a truly powerful empire, you can borrow a lot of money at surprisingly reasonable rates. Today's deficits are in fact dwarfed in relative terms by the amounts the British borrowed to finance their Global War on (French) Terror between 1793 and 1815. Yet British long-term rates in that era averaged just 4.77 percent, and the pound's exchange rate was restored to its prewar level within a few years of peace. It is only when your power wanes -- as the British learned after 1945 -- that owing a fortune in your own currency becomes a real problem. As opposed, that is, to someone else's problem.

Subject: The Quality Health Care Cure?
From: Emma
To: All
Date Posted: Sun, Mar 13, 2005 at 18:57:36 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/13/magazine/13HEALTH.html?8hpib=&pagewanted=all&position= The Quality Cure? By ROGER LOWENSTEIN David Cutler hit what seemed to be the peak of his career at 28, when as a junior faculty member at Harvard he was whisked down to Washington to help draft a health-care bill under the tutelage of Ira Magaziner and, of course, Hillary Clinton. The project produced a dispiriting result: nothing. Corporations, consumers, the uninsured and doctors had all been clamoring for reform, and the question of why the project failed has nagged at Cutler ever since, especially as the problems have continued to worsen. In the years since he left Washington, which was in 1994, the ranks of the uninsured have surged, from 35 million people to 45 million. There are also serious gaps in the quality of care, and there is a deep dissatisfaction with the way the system functions -- in how it seems to make adversaries of patients, doctors and insurers, for instance. Arguably, Americans want health-care reform more urgently than anything else. Yet designing a national health-care policy has become a kind of taboo. Congress provided prescription drugs for seniors, and President Bush, not normally thought of as timid, has backed some modest initiatives: legislation to limit malpractice suits, individual health savings accounts. But Washington has done nothing on the scale that a social engineer -- a Robert Moses or a Daniel Patrick Moynihan -- might to reinvent the system. Cutler has thought about this ever since his failed experience in Washington, and his diagnosis has shaken up the health-care-policy world. ''The real reason health-care reform has not succeeded,'' he has written, ''is that it is rooted in a misconception of what health-care reform should accomplish.'' Virtually every would-be reformer, Democrat and Republican alike, starts with the presumption that the major problem in health care is high costs. This is understandable: America now spends 15 percent of its gross domestic product on health care. That's a higher percentage than any country has ever spent in the history of the planet, and the figure is increasing. The United States spends more on health care than on automobiles; we spend more on health care than China spends on tea; in fact, as Cutler likes to point out, we spend more on health than the Chinese spend, per capita, on everything. And health care threatens (far more than Social Security) to consume the federal government. Medicare, the health-care program for retirees, and Medicaid, which provides basic services for the poor, already account for one-fifth of the federal budget, and their share could double in a generation. Curbing such growth has been the aim of every reformer, and according to Cutler, it is the reason reform has failed. The Clinton team proposed to pay for universal coverage by limiting increases in spending (partly through mandatory caps). But limiting spending also meant limiting service. The proposed legislation was never put to a vote. Managed care was next at trying to contain costs. It succeeded for a while, until it became clear that Americans did not want health-maintenance organizations to limit their choices any more than they wanted the government to. Since then, reform has languished. The Medicare drug bill is suggestive of why. The Republican Congress promised restraint but then passed a hugely expensive law that barred Medicare from using its clout to negotiate prices with drug companies. The pattern has been failed efforts to control costs, followed by a void of new ideas. Cutler's approach is radically different. He says that most health-care spending is actually good. Spending has been rising, he says, because it delivers positive, and measurable, economic value, and because it can do more things that Americans want. Therefore, Cutler says, we should focus on improving the quality of care rather than on reducing our consumption of it. Rather than pay less, he wants to pay more wisely -- to encourage health-care providers to do more of what they should and less of what is wasteful....

Subject: Re: The Quality Health Care Cure?
From: johnny5
To: Emma
Date Posted: Mon, Mar 14, 2005 at 00:31:21 (EST)
Email Address: johnny5@yahoo.com

Message:
secretaries rubin and peterson said we spend too much money in the last few months of life on stroke victims who have a lot of tubes in them and have no quality of life - if we would send these people home to die of flu like they do in european countries instead of prolonging thier misery for a couple more months, we could fix the healthcare problem. I watched a canadian movie called the barbarian invasions where this hypocritical socialist used the money of his capitalistic son to buy his way out of the healthcare system he voted for many years earlier - and then after all this money is spent - the guy gets on heroin on OD's! What a waste.

Subject: Weaken Dollar
From: Fur
To: All
Date Posted: Sun, Mar 13, 2005 at 14:17:33 (EST)
Email Address: dfasdfa@yahoo.com

Message:
Hey guys... just want to ask your opinion... It looks like US is having a trade largest trade deficit last month. i am a little worried about the current situation since the dollar has gone weaker. It looks like the US economy is not really doing well under the Bush Administration. Are we heading for recession ???

Subject: Perhaps
From: johnny5
To: Fur
Date Posted: Sun, Mar 13, 2005 at 16:07:37 (EST)
Email Address: johnny5@yahoo.com

Message:
Perhaps we are, but if so maybe some of that high coastal property in south florida will come down to very good price levels and you can make a killing in the real estate market if you come here. The property taxes and house insurance are getting so bad I am hearing many cubans talking about leaving florida going back home where the oppression was not so great.

Subject: Re: Weaken Dollar
From: Fur
To: Fur
Date Posted: Sun, Mar 13, 2005 at 14:19:55 (EST)
Email Address: afasdfa@yahoo.com

Message:
sorry for my english... i am an investor in Cuba. I am into real estate .

Subject: Three Proofs that TSM is Efficient
From: Emma
To: All
Date Posted: Sun, Mar 13, 2005 at 10:27:59 (EST)
Email Address: Not Provided

Message:
http://homepage.mac.com/j.norstad/finance/index.html#tsmproofs January 28, 2005 Three Proofs that TSM is Efficient By John Norstad Many people do not understand why the cap-weighted total US stock market (TSM) plays such a central role in financial economics. They believe that TSM is just one of many possible US stock portfolios, with no good reason to believe that it is special or superior to other kinds of US stock portfolios. They often present alternatives which they claim offer a higher expected return than TSM with less risk. In technical terms, these alternatives are 'more efficient' than TSM. We give three proofs that, under three different assumptions, TSM is efficient, in the sense that no other US stock portfolio can be more efficient than TSM (have lower risk and higher expected return). The three assumptions are: The Efficient Market Hypothesis. The Capital Asset Pricing Model. The Fama-French Three Factor Pricing Model. If any one of these assumptions is true, TSM must be efficient. If any other US stock portfolio has a higher expected return than TSM with lower risk, we must reject all three of the assumptions.

Subject: Berkshire Hathaway
From: johnny5
To: Emma
Date Posted: Sun, Mar 13, 2005 at 16:29:42 (EST)
Email Address: johnny5@yahoo.com

Message:
Great find Emma, I will being reading it now, first some initial thoughts. On the CAPM we have this: http://socialize.morningstar.com/NewSocialize/asp/FullConv.asp?forumId=F100000079&convId=115736 ..I believe Buffett's concern is that, according to the CAPM equation, a stock that has fallen 50% versus the market is considered more 'risky' versus a stock that has risen 25%. Beta is a measure of volatility and doesn't really take into account the direction of prices. This is counter-intuitive to a value investor, because a stock that has fallen significantly in value is generally considered less risky and more attractive than a stock that has risen in value. 9. 3 factor model arielb| 02-01-05 | 02:17 PM Eugene Fama and Ken French have also thrown out beta and CAPM Yes, the originator of EMH is also a value investor Given EMH - How does warren continue to outperform? I think I read on morningstar he has only been under the s&p 6 years out of the past 40? http://news.morningstar.com/doc/document/print/1,3651,121436,00.html Buffett has never been a fan of spreading his bets. Diversification may reduce volatility, but it doesn't necessarily reduce risk. The two concepts are often confused. Volatility can actually help reduce risk because it allows more opportunities for a savvy investor like Buffett to load up on an asset when prices are attractive. Buffett argues that the best way to reduce risk is to focus on companies you know extremely well and companies that boast strong competitive positions. If their earnings or share price happen to bounce around a lot in the short term, who cares? Although Buffett often gets pigeonholed as a value investor, only 4% of Berkshire's portfolio resides in value stocks as Morningstar defines them. Berkshire's largest equity holdings--American Express, Coca Cola, and Gillette--currently reside in the core column of Morningstar's Style Box. Among the growth stocks in the Berkshire portfolio: First Data, Comcast CMCSA, Moody's MCO, and Shaw Communications SJR. There is an article on the diehards message board on another group seriously underperfoming. http://socialize.morningstar.com/NewSocialize/asp/FullConv.asp?forumId=F100000015&convId=139787&minReplySeq=1#replyTop I came across an article while searching for papers on Graham and Dodd. It isn't entirely on topic for the Diehards but it is a reasonable rebuttal of common arguments that the market is efficient (and therefore there is no such thing as skill and therefore it is not possible to consistently outperform or underperform) and the argument that institutional investors are always smart cookies who take advantage of all inefficiencies and rapidly arbitrage them away before the small investor ever gets to see them. I read much of this paper in a state of open-mouthed horror and barely comprehending disbelief. AXA Investments and Trusts: The awful truth - full report If the market was efficient there is no way that someone could have had such bad performance over such a long period of time, especially an institutional investor, it takes an enormous level of negative skill to underperform over the space of so many decades. Please respond with your comments Emma - My uncle's retirement is dependant on not making a foolish choice. Should he just buy berkshire hathaway and be content and forget about vanguard?

Subject: The President's Stealthy Tax Increase
From: Emma
To: All
Date Posted: Sun, Mar 13, 2005 at 10:14:07 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/13/opinion/13sun1.html Mr. Bush's Stealthy Tax Increase President Bush is presiding over a big middle-class tax hike. As recently as 2000, only about one million taxpayers owed the alternative minimum tax, created by a provision in the federal tax code that is supposed to prevent multimillionaires from using loopholes to avoid paying their fair share. But by the time Americans file their 2005 taxes, some 3 million taxpayers will owe the alternative tax and by 2010, nearly 30 million taxpayers will be hit - among them, a staggering 94 percent of married filers who have children and make $75,000 to $100,000. Big families in high-tax states - New York, New Jersey, California and Massachusetts - will bear the heaviest burden, largely because the alternative tax increasingly disallows write-offs for dependents, state income taxes and local property taxes. On average, by 2010, people who make under $100,000 and owe the alternative tax will pay an additional $1,321 in federal income taxes, while alternative tax payers who make between $100,000 and $200,000 will owe an additional $2,592. Meanwhile, and most outrageous, only 35 percent of taxpayers who earn $1 million or more will owe the alternative tax. • Why does the alternative tax increasingly afflict middle-rung taxpayers for whom it was never intended, while largely ignoring the highest-end taxpayers it is meant for? First, the alternative tax is not adjusted for inflation, so over time, more and more middle-income taxpayers find themselves owing it. Second, and crucially important, is the interplay of the alternative tax and Mr. Bush's first-term tax cuts. When the tax cuts were enacted, no long-term corresponding changes were made to the alternative tax system - even though the administration was well aware that was a recipe for disaster. Not only will many families that thought they were in for lower income taxes wind up feeling shortchanged, some will find that the Bush tax cuts have done nothing at all to cut their taxes. Here's why: The alternative tax applies to people whose income tax bills are low relative to their income. So as tax cuts reduce the liability on a filer's Form 1040, the alternative tax kicks in. In effect, it claws back all or part of the supposed savings from the Bush tax cuts. By 2010, the Bush tax cuts alone will cause an additional 17 million taxpayers to owe the alternative tax. By 2014, assuming the Bush tax cuts are made permanent, 40 million taxpayers will owe the alternative tax, nearly half of whom would never have faced it but for the tax cuts. Meanwhile, the people who should be paying the alternative tax do not. Mr. Bush's administration, more than any other, has bestowed tax breaks on wealthy investors in the form of superlow rates on capital gains and dividends. But the alternative tax system - which regards deductions for property taxes or state income taxes as a kind of tax shelter - does not recognize this preferential treatment of investment income. That is a huge loophole. The alternative tax, whose very purpose is to prevent excessive sheltering, ignores the biggest tax breaks of all: special, low rates on capital gains and dividends that allow investors to avoid paying tens of billions of dollars in taxes every year. Ever since the first round of Bush tax cuts were enacted, Congress has passed temporary relief measures to keep most middle-income taxpayers from owing the alternative tax, but the problem is becoming too big, too fast, for stopgaps to keep working. Mr. Bush, for his part, says that he wants to shield the middle class from the alternative tax and that his tax reform commission will recommend a solution when it makes its report in July. • But Mr. Bush needs the alternative tax - he relies on its projected revenue to mask the debilitating cost of making his tax cuts permanent. Congressional estimates say that extending them permanently will cost $281 billion in 2014. But that estimate assumes that nothing will be done to prevent the alternative tax from further burdening the middle class. If the middle class is fully protected, the cost of extending the tax cuts will mushroom to $356 billion - 27 percent higher than the official estimate. The federal budget deficit would explode. The obvious answer is to restore the alternative tax to its true antisheltering purpose, by making inflation adjustments that will exempt the middle class once and for all and by fully taxing capital gains and dividends under the alternative system. But Congress and the administration are currently heading in precisely the wrong direction. The Bush tax breaks for investment income are scheduled to expire in 2008, but both the president and Congressional leaders are calling for extending them, at least through 2010, while proposing no corresponding long-term change in the alternative tax. • Bush administration officials and their antitax allies seem to believe that if taxpayers become angry enough at having to pay the alternative tax, they will throw their support behind any tax reform plan the administration puts forth. That is fomenting a crisis in order to appear to solve it. Is it too much to ask not to put the country through that kind of cynical exercise yet again?

Subject: Why do the Republicans punish the rich?
From: David E...
To: Emma
Date Posted: Sun, Mar 13, 2005 at 14:01:23 (EST)
Email Address: Not Provided

Message:
1% of taxpayers is caught up in AMT through 2000. 67% will be caught up by 2010. Grover Norquist says 'Why in the world would we cross the street to solve the Democrats' problem that they created -- that primarily first screws their constituents and then everybody else? The answer is yes, we'll fix it... After we've gotten rid of the death tax, and the capital gains tax and droppe marginal tax rates, we'll work on it.' (1) This take no prisoners stance of the Republican party is ugly, gives the lie to claims of bipartisanship, and is dangerous because Americans believe in fair play. I believe this is one more talking point that needs to be pounded into a republican coffin. Label them as recalcitrants and the major source of the coming grief. (1) San Diego Union Tribune - Mar 13, 2005 - Copley News Service, Dana Wilkie and Finlay Lewis)

Subject: Re: Why do the Republicans punish the rich?
From: Paul G. Brown
To: David E...
Date Posted: Mon, Mar 14, 2005 at 02:45:50 (EST)
Email Address: Not Provided

Message:
Wow! Well, you learn something new every day. I had some respect for our Grover. I didn't like the ideas he was advocating, and I distrusted his monomania. But I believed him to be a sincere warrior in the cause of reducing the size of the state. But if this statement accurately reflects his thinking, then he's really nothing more than a much less honorable warrior in the class war. 'Stuff the rest of you!', he seems to be saying. Plutocracy and timocracy forever! No other word for it. The bastard!

Subject: Re: Why do the Republicans punish the rich?
From: David E...
To: Paul G. Brown
Date Posted: Mon, Mar 14, 2005 at 13:03:10 (EST)
Email Address: Not Provided

Message:
I doubt that Grover's plan to reduce the size of the state will meet american standards of fair play. I have to imagine this, but why would republicans want to run deficits? The only reason I can imagine is to create a crisis which calls for the 'amputation' of many federal programs. This is a familiar tactic, most recently seen with the Social Security 'crisis'.Here is a link where he reaffirms his 'drowning government in a bathtub' speech on PBS. The language is softened here - but his objective is still very clear. Here is a excerpt of a recent speech he gave in Spain. He gloats about America's greatest generation dying. 'Yes, because in addition their demographic base is shrinking. Each year, 2 million people who fought in the Second World War and lived through the Great Depression die. This generation has been an exeception in American history, because it has defended anti-American policies. They voted for the creation of the welfare state and obligatory military service. They are the base of the Democratic Party. And they are dying. And, at the same time, all the time more Americans have stocks. That makes them defend the interests of business, because it is their own interest. Because of that, it's impossible to bring to the fore policies of social hate, of class warfare”' Notice the last sentence. He is talking about making class warfare and hate disappearing, but from his language I find reason to believe that he is a strong hater himself. There is no kindness or tenderness expressed about the passing of the 'Greatest Generation'. Paul, I too am surprised by the viciousness, cunning, and hate in the plans of Grover Norquist. When I verify the original sources I find nothing to make me think that the quotes are bogus. The two quotes today can be found numerous times with Google. Yesterday's quote is from a newservice owned by the San Diego Union, a Republican paper. I welcome information that could change my beliefs about this. I would like to live in a time like the 50's with an Eisenhower republican president.

Subject: China to Cut School Fees For Poorest
From: Emma
To: All
Date Posted: Sun, Mar 13, 2005 at 09:39:53 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/13/international/asia/13china.html China Plans to Cut School Fees for Its Poorest Rural Students By JIM YARDLEY BEIJING - China will begin eliminating rural school fees this year in response to growing criticism that the education system is increasingly corrupt and discriminates against poor rural students. The new policy, announced last week by Prime Minister Wen Jiabao at the opening of the annual National People's Congress, will begin by removing fees for 14 million students in the country's poorest counties, and will continue expanding until 2007, when all rural students will receive a free primary education. The program is part of a broader domestic agenda outlined by Mr. Wen to address increasing inequality in China, where urban residents earn three times as much as farmers and other rural residents. Education fees are particularly crippling for rural families, who often survive on only a few hundred dollars a year. 'Without fairness in education, there can be no fairness in society,' said Zhou Hongyu, a delegate to the National People's Congress, China's legislative body. 'The main injustice in education now is the imbalance between cities and the countryside.' Recent studies show that an overwhelming percentage of government education spending is dedicated to cities, despite the fact that two-thirds of the 1.3 billion Chinese live in the countryside. Li Shi, a prominent sociologist, wrote last month in the official English-language newspaper, China Daily, that the country dedicated only 23 percent of its education budget to the countryside in 2002. He said this disparity meant that rural students often missed out on an adequate education 'just by being in the wrong place, at the wrong time.' In February, a group of retired educational officials in Hunan Province published a broader, more blistering critique that detailed how the cost of supporting and building rural schools in Hunan fell largely on farmers who were already among the poorest members of society. This critique, in China Youth Daily, said rural students were further disadvantaged because a growing number of high schools and universities were lowering standards for wealthier students whose parents could make cash payments for admission, leaving less room for poor students to be admitted on merit. In addition, many universities are required to admit quotas of local city students. At a time when China is annually increasing military spending and pouring money into infrastructure projects, spending on education has fallen below projections established by the government in 1993 and is below the international average of developing countries. Mr. Wen's promise to eliminate school fees may ultimately be difficult to carry out in a country where changes announced by the central government are often circumvented locally. China already promises nine years of free compulsory education to all students. But faced with reduced government support, schools have attached a variety of special fees to make up for the lost revenues. For rural families, these fees can account for a quarter or more of their annual income and often are a primary reason that parents leave the farm for migrant work. Last year, financial pressure was a contributing factor in several high-profile suicides or rage killings by rural high school and university students. Hu Xingdou, a professor of governmental economics at Beijing Institute of Technology, said that Mr. Wen's new policy moved China in the right direction but added that the government needed to assume all costs of compulsory education and eliminate corrupt practices that gave preference to wealthy or politically connected families. 'The rural education system is on the verge of collapse,' Mr. Hu said. Taiwan Leader Urges Protest TAIPEI, Taiwan, March 12 (Reuters) - President Chen Shui-bian of Taiwan called Saturday for a million people to take to the streets of Taipei, Taiwan's capital, on March 26 to protest against China's anti-secession bill, which allows for the use of force against the island. Mr. Chen, in his first public comments on the proposed Chinese legislation since Beijing unveiled its details on Tuesday, called China a 'major threat to regional stability' and said the legislation would increase tension in the Taiwan Strait. China's Parliament is expected to pass the bill on Monday.

Subject: Tianemen redux
From: johnny5
To: Emma
Date Posted: Sun, Mar 13, 2005 at 16:01:20 (EST)
Email Address: johnny5@yahoo.com

Message:
Ths is great news for the chinese children, I am glad to see them learn more with good elementary education, this will be a great mesh with thier fine rural values. I see college people today in america and feel thier advanced education may not have been as useful as a few good summers working on a farm and learning agricultural lifestyles. Don't the nike's of the world realize when they educate all these farm kids they are not gonna be happy being slave labor in a sweatshop? On the taiwan issue, this is definitely a conundrum, but we invaded iraq and china did nothing, so I guess holding all our dollars they expect us to do nothing when they take taiwan. Poor taiwan. They need to learn to embrace thier new masters.

Subject: 'Every Man a Speculator'
From: Emma
To: All
Date Posted: Sun, Mar 13, 2005 at 09:36:22 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/13/books/review/13EVANS.html?pagewanted=all&position= 'Every Man a Speculator': Follow the Money By HAROLD EVANS EVERY MAN A SPECULATOR A History of Wall Street in American Life. By Steve Fraser. TRY a multiple choice question. Which phrase best describes Wall Street: (a) a den of thieves; (b) the engine room of innovation; (c) a conspiracy of oligarchs; (d) Babylon on the Hudson (e) the yellow brick road to a property-owning democracy? In his rollicking history over two centuries, Steve Fraser nominates all of the above. He is notably assiduous. He plots the roller coasters of boom and bust from the panics of 1792, 1837, 1873 and 1893, through the Jazz Age and the Great Depression to the ''socially negligent and narcissistic'' second Gilded Age of the Reagan 80's and on to today's ''shareholder nation.'' He examines the biographies of the icons and the rap sheets of the scoundrels, but he also eyes the Street in succeeding eras through the critical prisms of literature and the movies. Yes, Gordon (''greed is good'') Gekko rubs shoulders with J. P. Morgan. This is not so much a financial as a cultural history. Fraser's ambition is to examine ''how Wall Street has entered into the lives of generations long passed and those alive today . . . the way the character of America has changed.'' He recognizes the dubiousness of fixing a unitary character on a polymorphous people, but argues that if you distill all the histories, all the satiric cartoons, the brimstone sermons, the exposes, the Horatio Alger storybooks -- all the Wall Streets of the mind -- Wall Street becomes ''a window into the souls of Americans.'' That is a tough image to hold fast when one decade we are frolicking in the Elysian Fields with the ticker tape registering at $549 stock we bought at $85.25 a year before, the next we are weeping in Dante's Purgatory with Charles Ponzi, Ivan Boesky & Company (more recent candidates are crowding the anteroom). The popular mood pictured in ''Every Man a Speculator'' is volatile. It swings from loathing in the bad years to irrational exuberance in the good. Mostly, it seems to have been one of irritable ambivalence. But Fraser, also the author of ''Labor Will Rule: Sidney Hillman and the Rise of American Labor,'' has a keen grasp of his material, and his vivacious style and historical perspective carry us through the tumults. Rather surprisingly, at the end he suggests that today ''most of the hoary suspicions'' have faded away. He concludes that back home in living rooms all across America, where culture wars are ultimately settled, popular hostility to the Street has been revised ''even in the teeth of the most stunning Wall Street frauds since the crash of 1929.'' His explanation for this, and for Democratic rhetoric no longer demonizing the Street, is the explosion of institutional investing through pension funds and mutual funds. The largest pension funds own 60 percent of the largest corporations. For the first time roughly half of the population participates in the stock market, up from 10 percent in 1960. Only a minority may be involved actively, but Fraser considers their mortgages and college anxieties and dreams to be intertwined directly and intimately with Wall Street in a way not seen before. One would have thought this would make people a tad cross about having their pockets picked, say by investment bankers posing as disinterested analysts (as Charles Gasparino lays out in his chilling new book, ''Blood on the Street''), but Fraser stoutly maintains that in a society obsessed with consumption the ''homely motivations'' of the suburban capitalists have ''removed the taint of avariciousness that had always discolored the market.'' He appears to think the common-sense charisma of a Warren Buffett of Berkshire Hathaway or a Peter Lynch of Magellan looms large enough in the average man's mind to obscure Kenneth Lay of Enron, Bernard Ebbers of WorldCom, Jack Grubman of Salomon Smith Barney, Henry Blodget of Merrill Lynch, etc., alas, etc. Fraser is by no means an undiscriminating booster. He writes discerningly on the nexus of politics and finance. He offers an appraisal of the 19th-century Populist agitation about ''the money trust'' sucking blood out of the agrarian heartland that is uncommonly sympathetic and on the mark. The Wall Street gold bugs were dumb to inflict such a prolonged deflation on the country after the Civil War. It is a pity Fraser does not bring quite the same skepticism to conventional history when he arrives at Black Tuesday, 1929, and the Great Depression. The long shadow fixed in the popular imagination is that the stock market crash came first, precipitating bank closures and bankruptcies and then the long free fall of output, incomes and employment. It was not quite like that. No major company fell in the crash. The wave of business liquidations was a full year off. There were no immediate bank failures. The market recovered; it was firm from November 1929 to April 1930. This is not to say the great bull market was sound. Professor William Z. Ripley was justified in trying to arouse President Coolidge in 1928 to the ''prestidigitation, double-shuffling, honey-fugling, hornswoggling and skulduggery.'' But concentrating on the crash as the simple cause of 10 years of misery diverts attention from the shift in tectonic plates: by mid-1928, mass purchasing power no longer sustained the economy because industrial wages and farm incomes had fallen way behind output and profits. No amount of new regulation of Wall Street would have saved America from what followed unless demand had been stimulated and a thoroughly unbalanced budget embraced -- something even Franklin Roosevelt did not countenance until 1942. In the end it was the engineers, not the financiers, who saved the world. Fraser briefly acknowledges the work of a new generation of scholars and economists in putting Black Tuesday in proper perspective, but he concentrates on the way the crash ''invoked the whole historic iconography of shame that had shadowed the Street since the days of Thomas Jefferson.'' There is nothing he relishes more than a good scandal. In his lineups, he mostly and entertainingly identifies the right people. Here going off to Sing Sing in his bowler hat and black coat is the president of the Stock Exchange, Richard Whitney, who has raged against Roosevelt's New Deal reforms while stealing from the exchange's own gratuity fund and embezzling from the New York Yacht Club (is nothing sacred?). And here is former President Coolidge, the Democratic Party chairman John Jakob Raskob, the World War I hero Gen. John J. Pershing and numerous C.E.O.'s, all without a blush secretly accepting insider prices on Morgan confections. Fraser skewers crony capitalism while being oddly gentle with its apotheosis, the lordly plutocrat Andrew Mellon. Was a tax-evading Treasury secretary whose answer to the Great Depression he helped to bring on was to ''liquidate labor, liquidate stocks, liquidate the farmers'' really a ''great man''? At the same time, Fraser in his appetite for villainy is sometimes a little too like the Queen in ''Alice in Wonderland'': sentence first, trial later. Michael Milken does not deserve his place in the tumbrel; he was not guilty of insider trading, and his financial and business innovations were significant. Fraser is cavalier in his treatment of Samuel Insull. It matters to get Insull's story right. He is one of history's answers to the crucial question Fraser poses in his introduction: Has Wall Street been vital to the nation's efficiency, innovation and growth? Fraser describes Insull as a creator of ''a cloud of paper wealth'' and says he was guilty of ''the grossest fleecing in American financial history.'' He has taken his text from John Dos Passos in ''Big Money,'' the third volume of the trilogy ''U.S.A.''; and it is a caricature. In truth, Fraser's ''king for a day'' worked nearly 50 years to electrify America. He was a lowly English clerk who started as Thomas Edison's gofer at 21 and helped build the company that became General Electric. In 1892, at 37, he took over a tiny power station in Chicago and conceived of a way -- power produced by huge generators and marketed at peak and off-peak rates -- to bring ever cheaper electricity to industry, street cars and the homes of millions of people otherwise dependent on gas. Insull made two errors on the onset of the Depression. He believed President Hoover that it would soon be over, and he kept expanding. When recovery did not come, his companies crashed. He was saved from jail not by ''a swarm of high priced lawyers,'' as Fraser would have it, but by his own moving testimony. The prosecution had been a politically motivated witch hunt, and the jury took five minutes to clear him of all charges. In the end, about 40 percent of the stock of all American corporations was forfeited; that of Insull's electrical and gas operating companies fell by less than 1 percent. Insull was not a crook. He was an innovator of the first degree, supported by Wall Street only, in Lenin's phrase, as a rope supports a hanging man. It was the same in 1932 with Amadeo Giannini, the heroic pioneer in California of popular banking and branch banking, ignored in Fraser's history. Giannini's triumph over the ''Wall Street gang,'' as he called his enemies around John Pierpont Morgan Jr., in one of the country's great takeover battles enabled him to finance the recovery in California. The Bank of America is his monument today. Curiously for his expansively researched book, Fraser is not excited much to investigate the relationships between money and invention. He refers to new mass-market technologies driving the 20's boom, like radio, sound movies, electric appliances, synthetic fabrics and Bakelite; he sketches the dot.com bubble of the 90's. But he does not examine how these innovations were brought from lonely brain wave to the bustle of the marketplace. There is a downside to the ''shareholder nation.'' It intensifies the stock market's appetite for a quick buck at the expense of the fortitude required to establish a new business or plan for growth in the long term. The luminous former Treasury Secretary Robert Rubin has remarked that an analyst who forecasts the five-year prospects for the Ford Motor Company will probably never make a living. Rubin laments the way the pension funds, the mutuals and amateur speculation -- every man a speculator! -- have put traditional Wall Street's short-term thinking into overdrive, to the detriment of the long term and risky innovation. Multibillion-dollar private equity groups have come more and more to the fore, irrigating the seeds of such now established companies as Genentech, Intel and Google. It is a remarkable sign of the ingenuity and enterprise in the broader Wall Street today. Georges Doriot, scanted like Giannini, deserves at least a friendly nod. He so despaired of Wall Street's reluctance to catch up with postwar technological change that he founded the first publicly owned venture capital investment company in 1947 (the American Research and Development Corporation). Out of that came the first interactive minicomputer. A historian as dedicated as Fraser will no doubt repair omissions in due course. Meanwhile, he deserves a cheer for his long ascent to the summit. He affords us a panoramic view of decades of high endeavor and low greed. Wisely, he does not attempt to crown his endeavors by forecasting the course of the Dow. Nobody can say it better than J. P. Morgan. When asked what the market would do, he summoned all his authority and gravely pronounced: ''It will fluctuate.''

Subject: Beyond Our Interests
From: Emma
To: All
Date Posted: Sun, Mar 13, 2005 at 06:54:39 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/12/business/worldbusiness/12africa.html?ei=5070&en=7abbed303d42e158&ex=1111294800&pagewanted=all&position= Dollar's Fall Silences Africa's Garment Factories By MICHAEL WINES MAPUTSOE, Lesotho - Buy a T-shirt at Wal-Mart, fleece sweats at J. C. Penney or Hanes panties anywhere in the United States, and there's a halfway decent chance that they were stitched together here, in an acre-size garment factory crammed with thousands of frantically clacking sewing machines. Virtually its entire output, 25,000 items of clothing daily, is America-bound. These days, that is a disaster. 'Two thousand people work here, and unfortunately last week I had to retrench 500 people, because there are no orders,' Boodia Heman, director of the Ever Unison Garments factory, said in a recent interview. 'The American buyer is not coming to Lesotho to buy.' Actually, the problem is not so much the buyers from America. It is the American dollar, and its headlong plunge in value. Three years ago, Lesotho's garment factories had to sell only $56 worth of clothes to stores in the United States to cover the monthly wage of 650 maloti for a sewing-machine operator. Today, that same salary consumes $109 in sales. When the dollar is worth 8.5 maloti or more, Mr. Heman said, 'we break even and we are satisfied.' Right now, the weak dollar fetches less than 6 maloti. The dollar could not have shrunk at a worse time for southern Africa....

Subject: Re: Beyond Our Interests
From: Terri
To: Emma
Date Posted: Sun, Mar 13, 2005 at 18:14:26 (EST)
Email Address: Not Provided

Message:
We think about a strong dollar a weak dollar and how each would effect us and even our prime trade partners, but we do not think how this might affect smaller countries in Latin America or Africa.

Subject: Risk and Time
From: Emma
To: All
Date Posted: Sun, Mar 13, 2005 at 06:43:56 (EST)
Email Address: Not Provided

Message:
http://homepage.mac.com/j.norstad/finance/risk-and-time.html January 28, 2005 Risk and Time By John Norstad A collection of arguments disputing the ubiquitous popular opinion that the risk of investing in volatile assets like stocks decreases as one's time horizon increases. This is an attempt to make some sense out of a profoundly important and deep issue which all investors should take seriously. We discuss the fallacy of time diversification, the utility theory argument, the inadequacy of using probability of shortfall as a risk measure, an argument based on the theory of option pricing, and the impact of human capital on the problem.

Subject: Short term puts and calls
From: johnny5
To: Emma
Date Posted: Sun, Mar 13, 2005 at 23:29:54 (EST)
Email Address: johnny5@yahoo.com

Message:
OK I have read the page and it seems this person or whoever the originator of the 2 threads this page referenced on diehards was heavily invested in one particular TECH company stock (thier employer I believe) and this was in march 2000 - so johnny5 is gonna take a guess and bet they lost their ass bigtime and wanted to discover how this could have happened. Johnny5 walks away from this page with a bigger brain and thinks why didn't more independent people with LARGE monies in the market buy laddered short term future's contracts against their S&P 500 holdings as PROTECTION for their large monies. Johnny5's grandfather lost his 40 acre farm during the early years of this country because he was not sophisticated enough to understand future's and protection. His crop did bad one year and the old man was wiped out and never recovered. Now johnny5 wonders why these annuities being sold his uncle does not have an extra level of sophistications and on top of investing in mutual funds for growth - invest in futures in case of collapse and really smooth out that potential loss of principle - certainly this is something that should have dawned on jackson natiional life, prudential, and raymond james. Johnny5 is going to ask this question on the financial-planner board where they already don't like johnny5 and see what he can come up with.

Subject: Running on Empty afterthoughts
From: johnny5
To: All
Date Posted: Sat, Mar 12, 2005 at 22:52:22 (EST)
Email Address: johnny5@yahoo.com

Message:
Did anyone else get to watch it? Some more thoughts, the panelists agreed that rubin had military budgets he could cut to get the deficit in order - not gonna happen in this new age of terrorism, also one audience member said we had unused human capital in people that were not college educated - just smarten them up and we will get richer - and they shot him down because they said the scientists are from abroad now much more than here in the USA and that the smart cheap engineers of china and india are taking over. One of the audience was from germany and it was like he had no clue that his demographic and entitlement problems back home in europe was MUCH worse than here in America - even though they are really bad here. This surprised me as I think all the people in the room were educated and older economists - I even recognized the guy from the annenberg/CPB series on economics that I watch on PBS a lot - if they are still so unclear to the real problems facing us - how can you blame the general populace. Even Rubin said smart economists he knew that were invested in the market admitted the titanic will sink soon, but they didn't know when and wouldn't limit thier exposure to the markets even though they were certain a hard landing was in the nearer future - this is not prudent according to warren I think - you don't ride it to the top - you get out when you see a problem. Rubin seemed to give the impression these people should know better and should get thier money out of the greater fool runup but weren't doing so. Does anyone that got to see it have any insight to the views presented? They really picked on alan greenspan bad - he couldn't finish his cheesecake without an insult to make him choke - I can't believe he set himself up for that abuse.

Subject: Re: Running on Empty afterthoughts
From: johnny5
To: johnny5
Date Posted: Sat, Mar 12, 2005 at 22:58:28 (EST)
Email Address: johnny5@yahoo.com

Message:
Oh and before I forget most of them seemed to agree benefit reduction is going to have to be the majority of the fix - whatever happens with taxes - so I guess me and all the other people under 50 can expect much more benefit reduction over the next 10-20 years and if stocks don't do so hot we won't make up for it before we retire. I see the current poor retirees here in the trailer park and don't want to live poorer than them and they retired in good bull years with lots of bennys :(

Subject: National Index Returns
From: Terri
To: All
Date Posted: Sat, Mar 12, 2005 at 17:46:40 (EST)
Email Address: Not Provided

Message:
http://www.msci.com/equity/index2.html National Index Returns [Dollars] 12/31/04 - 3/11/05 Australia 7.1 Canada 4.9 Denmark 7.5 France 5.0 Germany 1.5 Hong Kong -2.2 Japan 1.6 Netherlands 7.3 Norway 9.9 Sweden 2.9 Switzerland 4.3 UK 4.6

Subject: Re: National Index Returns
From: johnny5
To: Terri
Date Posted: Sat, Mar 12, 2005 at 18:03:47 (EST)
Email Address: johnny5@yahoo.com

Message:
Terri what percentage of your asset allocation is domestic versus international stocks and bonds? Are you holding any cash or fully invested in the markets?

Subject: Allocation
From: Terri
To: johnny5
Date Posted: Sat, Mar 12, 2005 at 18:36:24 (EST)
Email Address: Not Provided

Message:
Rather than hold cash, I use a Vanguard bond fund. Since I always have a bond fund holding, there may be capital gains or losses but over time the interest earned will be more than in a money market fund and the added interest in a difficult bond market will make up in time for a decline in share price. The GNMA Fund is a conservative holding at a time when long term rates may finally rise. Though I expect little from bonds, the ratio I hold has been reduced to about 60% stock fund and 40% bond fund from 75% to 25%. For stock allocation I lean to value and about 50% domestic to 50% international.

Subject: Sounds great
From: johnny5
To: Terri
Date Posted: Sat, Mar 12, 2005 at 21:20:31 (EST)
Email Address: johnny5@yahoo.com

Message:
Sounds like a very smart strategy, everything I am reading says you want value stocks long term and want to diversify internationally. This is what warren is doing on a macro scale. Value companies and international currencies. Secretary Peterson recommended in his running on empty talk the best strategy for these privatized accounts being proposed was to buy international bond index funds to keep the administrative costs down. If I could just get my uncle to be comfortable with using the internet for his money - but he is very old fashioned and wants a person he can see face to face. He does not even know how to spell computer and talking to him about buying international value i-shares would be like teaching a pig to fly.

Subject: Re: Sounds great
From: Terri
To: johnny5
Date Posted: Sat, Mar 12, 2005 at 21:34:40 (EST)
Email Address: Not Provided

Message:
Possibly your uncle can try calling Vanguard. The representatives are knowledgeable and helpful and patient. Though the representatives are not advisors, they know the company thoroughly.

Subject: Re: Sounds great
From: johnny5
To: Terri
Date Posted: Sat, Mar 12, 2005 at 23:03:45 (EST)
Email Address: johnny5@yahoo.com

Message:
Thanks for the suggestions Terri - I am trying to get him into vanguard since he has a lot of money. He has called and talked to several people at vanguard, gotten their packets and prospectuses and asset management information - he just doesn't feel comfortable in this new age of data - about 2 years ago someone got his data and opened credit cards in his name and lived la vida loca in michigan for about six months. He still has bad credit data on his file because of that which has presented problems to him in dealing with realtors and banks and everytime that commercial comes on with some old man talking with a young womans voice how she bought all this stuff on his stolen identity makes him preturbed. He doesn't like our new society much and hates all the technology and is easily confused and that was true before the stroke.

Subject: Re: Sounds great
From: Jennifer
To: johnny5
Date Posted: Sun, Mar 13, 2005 at 08:45:34 (EST)
Email Address: Not Provided

Message:
Please then use the most conservative possible investment only. The most conservative of mutual funds, like the Wellesley Fund. The most conservative.

Subject: Re: Sounds great
From: Jennifer
To: Jennifer
Date Posted: Sun, Mar 13, 2005 at 14:02:12 (EST)
Email Address: Not Provided

Message:
The more conservative the better. Your uncle could be completely secure with the 60% bond to 40% stock mix of Wellesley Fund. A 70% bond index to 30% stock index mix would make sense as well. Vanguard will be completely secure, and no other company would be needed.

Subject: Slashdot.org
From: johnny5
To: Jennifer
Date Posted: Sun, Mar 13, 2005 at 15:43:27 (EST)
Email Address: johnny5@yahoo.com

Message:
Thank you for the comments Jennifer. I guess what we have here is fundamental difference in the belief of the information age and security. Say my uncle does have 70% bond and 30% stock or even 100% cash in a bank of america checking account and a good russian hacker breaks into their database - steals his account info - or simply compromises his password and gets into his vanguard account. Bank of america just admitted to losing a huge data file with credit cards and account info of even US senators - where they had their money electronically - it made no difference - their security was compromised and bank of america had a huge stolen identity crisis that I feel the press did not properly report. Harvard I think was just broken into by applicants who were able to find out early wether they were accepted or not. Remember Jennifer - this is just the stuff we are hearing about, I assure you there are many things you are not. I worked at IBM for several years, my degree is in computer science and there is a lot of funny business out here on the digital frontier that many people are not aware of. We have a credit system and electronic money and underground markets that literally are anyone's guess at this point - the amount of subterfuge and funny business is increasing more and more. This did not worry me much until I had several friends and my uncle and my mother all victims of this new information age mostly through identity theft - a few of my friends bankrupted from this problem and through no fault of thier own. Jennifer I am reading on the morningstar boards in the fidelity forums how people are having 100K magically deposited in their 401K accounts and it taking fidelity days and weeks to discover their error - I have had a similar problem or should I say fortune (hehe) at an e-trade account a couple of years ago. I guess we should just disregard one of the largest investment institutions in existance making errors as silly and not concern ourself with it. If a fiat system based on paper was a fear of thomas jefferson - I wonder how these digital dollars make him turn in his grave. I knew several hackers that lived better than millionaires from being cyber cowboys on this digital frontier. In the old days to put $100K of gold coins accidentally in the wrong person's safe required an error of much greater stupidity than messing up on an electronic fidelity account. The system we have built in the virtual world may be beyond the competency of the general investing public and their guardians and distort things horrendously. But it seems reality and fundamentals are not key to investing, what is key is market perception, and if the world is about to be struck by a comet but the people on the planet are living la vida loca - it is foolish to try and go against the flow. So if the madding crowd jumps into vanguard and fidelity and does not concern themselves with 100K account errors - then it is prudent to adopt the mass psychology. The markets can remain irrational longer than you can remain solvent. I guess I will keep drinking from the punchbowl until all the juice is gone. My uncle sadly does not embrace this concept after his personal experience with identity theft and it has been a challenge to even get him to invest with a local person - much less someone over the internet. I am going to spend more time with him and try to convince him that market perception is all that really matters and fact and fundamentals as he perceives them are irrelevant when everyone else thinks the opposite.

Subject: Fidelity Competence
From: David E..
To: johnny5
Date Posted: Sun, Mar 13, 2005 at 18:52:32 (EST)
Email Address: Not Provided

Message:
Our Human Resources department needed to coordinate with Fidelity. It was a pain in the butt because they needed their stuff in 80 byte records. That's right, IBM card size. I am sure they weren't using cards, just reluctant to spend money on their data files and programs. So the Fidelity tradition continues and now their systems are so poorly designed that data errors take days and weeks to analyze. David E...

Subject: Human Capital
From: johnny5
To: David E..
Date Posted: Sun, Mar 13, 2005 at 23:45:09 (EST)
Email Address: johnny5@yahoo.com

Message:
It was my experience that the sophistication of new younger blood coming in on top of the old fortran programmers was very lacking in many companies. So many systems and so much data required a complete overhaul. They were learning new languages and hardware, but their fundamental education in algorithms and data types was depressing, they sure could code a nice webpage in java though. For the most part I am very impressed with the progress we have made, but when I hear things like this about major financial institutions I have nightmares of digital systemic risk. http://math.hws.edu/javanotes/c9/s1.html In 1985, a computer at the Bank of New York started destroying records of on-going security transactions because of an error in a program. It took less than 24 hours to fix the program, but by that time, the bank was out $5,000,000 in overnight interest payments on funds that it had to borrow to cover the problem.

Subject: There is no Worry
From: Jennifer
To: johnny5
Date Posted: Sun, Mar 13, 2005 at 18:34:55 (EST)
Email Address: Not Provided

Message:
There is no need to deal with Vanguard by Internet. All business can easily be done over the phone. There is insurance carried, and funds such as the GNMA or Treasury Funds are backed by Congress. I do not worry about Vanguard accounts for a moment.

Subject: Re: There is no Worry
From: Jennifer
To: Jennifer
Date Posted: Sun, Mar 13, 2005 at 18:46:05 (EST)
Email Address: Not Provided

Message:
There is no need of course to ever invest, but I prefer to and I am perfectly secure.

Subject: Re: There is no Worry
From: johnny5
To: Jennifer
Date Posted: Mon, Mar 14, 2005 at 00:10:23 (EST)
Email Address: johnny5@yahoo.com

Message:
This is the number 1 problem cited by the FTC, 50 billion estimated lost last year, all these hungry hackers add liquidity to the system that is not accounted for. When hard times fall these hungry hackers are not gonna turn in db coopers money bag. It didn't worry me much Jennifer until personal friends were hit hard by this theft. Now they have and it has crippled their financial lives. A few of them still invest, they buy collector coins that they put in a safe deposit box at the bank or they buy land and real estate. Identity Theft: Prevalence and Cost Appear to be Growing GAO-02-363 March 1, 2002 PDF Identity theft involves 'stealing' another person's personal identifying information, such as their Social Security number (SSN), date of birth, or mother's maiden name, and using that information to fraudulently establish credit, run up debt, or take over existing financial accounts. Precise, statistical measurement of identity theft trends is difficult for several reasons. Federal law enforcement agencies lack information systems to track identity theft cases. Also, identity theft is almost always a component of one or more white-collar or financial crimes, such as bank fraud, credit card or access device fraud, or the use of counterfeit financial instruments. Data sources, such as consumer complaints and hotline allegations, can be used as proxies for gauging the prevalence of identity theft. Law enforcement investigations and prosecutions of bank and credit card fraud also provide data. GAO found no comprehensive estimates of the cost of identity theft to the financial services industry. Some data on identity theft-related losses indicated increasing costs. Other data, such as staffing of the fraud departments of banks and consumer reporting agencies, presented a mixed or incomplete picture. Identity theft can cause victims severe emotional and economic harm, including bounced checks, loan denials, and debt collection harassment. The federal criminal justice system incurs costs associated with investigations, prosecutions, incarceration, and community supervision.

Subject: Gauging the Economy by Interest Rates
From: Terri
To: All
Date Posted: Sat, Mar 12, 2005 at 17:41:22 (EST)
Email Address: Not Provided

Message:
Robert Rubin watched the bond market rather than the stock market to gauge the health of the economy. I have done the same. The bond market has served well as a gauge for 25 years. There is an argument however that the bond market is no longer a proper gauge. Suppose long term interest rates are artificially low because international central banks are buying longer term bonds to support the dollar. Also, suppose speculators are borrowing short term funds and lending long term funds to play the spread in rates. This could be keeping long term rates lower than might be expected. This is the argument. I can not judge the correctness.

Subject: Running on Empty watch on web tonight
From: johnny5
To: All
Date Posted: Sat, Mar 12, 2005 at 16:29:03 (EST)
Email Address: johnny5@yahoo.com

Message:
Tonight on cspan3 at 6:54pm tonight - you can watch this over the web if you don't have cable. Greenspan is there with rubin and many other economists taking a lot of abuse - would appreciate the pkarchive comments on this 'alarmist' Forum Running on Empty Institute for International Economics Washington, District of Columbia (United States) ID: 183041 - 08/09/2004 - 1:41 - $29.95 Bergsten, C. Fred, Director, Institute for International Economics Rubin, Robert E., Secretary (1995-99), Department of the Treasury Peterson, Peter G., Chairman, Blackstone Group Mr. Peterson talked about his book Running On Empty: How The Democratic and Republican Parties Are Bankrupting Our Future and What Americans Can Do About It, published by Farrar, Straus and Giroux. Mr. Peterson argued that America is headed towards an economic meltdown because of the large deficit the country runs every year. He asserted that big tax cuts and heavy spending have contributed to the massive debt the country currently has and warned that if measures are not taken soon the economy will suffer dramatically. Following Mr. Peterson's remarks he joined Robert Rubin and C. Fred Bergsten in a panel discussion. Audience questions were also answered. At 5:11 pm you can watch this: http://inside.c-spanarchives.org:8080/cspan/cspan.csp?command=dprogram&record=164557288 Forum The Cheating of America Borders Books & Music Washington, District of Columbia (United States) ID: 163845 - 04/03/2001 - 0:52 - $29.95 Lewis, Charles, Executive Director, Center for Public Integrity Allison, Bill, Author Mr. Lewis and Mr. Allison talked about their book The Cheating of America: How Tax Avoidance and Evasion by the Super Rich Are Costing the Country Billions, and What You Can Do About It, published by William Morrow & Co. The book asserts that the federal treasury loses billions of dollars each year as a result of unpaid taxes. The authors developed statistics about the extent of the problem of tax evasion and what they feel is an inadequate response by the Internal Revenue Service. After the presentation the authors answered questions from members of the audience.

Subject: Possessions and Status
From: Emma
To: All
Date Posted: Sat, Mar 12, 2005 at 14:12:51 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/12/books/12happ.html?adxnnl=1&adxnnlx=1110654025-KTdB6mldRo4vupVUtSNvcQ&pagewanted=all&position= In New Book, Professor Sees a 'Mania' in U.S. for Possessions and Status By IRENE LACHER LOS ANGELES - Aldous Huxley long ago warned of a future in which love was beside the point and happiness a simple matter of consuming mass-produced goods and plenty of soma, a drug engineered for pleasure. More than 70 years later, Dr. Peter C. Whybrow, the director of the Semel Institute of Neuroscience and Human Behavior at the University of California, Los Angeles, has seen the future, and the society he describes isn't all that distant from Huxley's brave new world, although the soma, it seems, is in ourselves. In his new book, 'American Mania: When More Is Not Enough' (W. W. Norton & Company), Dr. Whybrow argues that in the age of globalization, Americans are addictively driven by the brain's pleasure centers to live turbocharged lives in pursuit of status and possessions at the expense of the only things that can truly make us happy: relationships with other people. 'In our compulsive drive for more,' writes Dr. Whybrow, 64, a professor of psychiatry and bio-behavioral science, 'we are making ourselves sick.' His book is part of a new critical genre that likens society to a mental patient. The prognosis is grim. In 'American Mania,' he argues that the country is on the downswing of a manic episode set off by the Internet bubble of the 1990's. 'It's a metaphor that helps guide us,' he said, perched on a chair in the study of his rambling high-rise apartment near U.C.L.A. 'I think we've shot through happiness as one does in hypomania and come out the other end, and we're not quite sure where we are. 'In fact, I think happiness lies somewhere behind us. This frenzy we've adopted in search of what we hope is happiness and perfection is in fact a distraction, like mania is a distraction.' 'American Mania' is his fourth book for the general public about meaty psychiatric matters. An expert in manic depression and the endocrinology of the central nervous system, he has dissected depression and its relatives ('A Mood Apart' and 'Mood Disorders') as well as the winter blahs ('The Hibernation Response'). Educating the public has been an abiding concern in a long career that began with training in psychiatry and endocrinology in his native London and in North Carolina. In 1970, Dr. Whybrow became chairman of the psychiatry department at Dartmouth Medical School and at the University of Pennsylvania. He moved to U.C.L.A. in 1997. While the Gordon Gekkos of the world have long had their critics, Dr. Whybrow sees the Enrons and the Worldcoms - the mess left by unfettered capitalism - not as a moral problem, but as a behavioral one. 'The outbreak of greed we've seen, especially in business, is partly a function of the changing contingencies we've given businessmen,' he said. 'If I say to you, 'You can make yourself extremely rich by holding up the share price until such time that you cash out your shares, which are coming due in another six months,' it takes an incredibly unusual person who'll say: 'The share price is going down? I'm afraid I lost that one.' There is an offer of affluence there which the person cannot refuse. They don't need that extra money, but they want that extra money.' People are biologically wired to want it, he contends. We seek more than we need because consumption activates the neurotransmitter dopamine, which rewards us with pleasure, traveling along the same brain pathways as do drugs like caffeine and cocaine. Historically, he says, built-in social brakes reined in our acquisitive instincts. In the capitalist utopia envisioned by Adam Smith in the 18th century, self-interest was tempered by the competing demands of the marketplace and community. But with globalization, the idea of doing business with neighbors one must face the next day is a quaint memory, and all bets are off. Other countries are prey to the same forces, Dr. Whybrow says, but the problem is worse here because we are a nation of immigrants, genetically self-selected to favor individualism and novelty. Americans are competitive, restless and driven to succeed. And we have succeeded.

Subject: Possessions and Status - 1
From: Emma
To: Emma
Date Posted: Sat, Mar 12, 2005 at 14:13:14 (EST)
Email Address: Not Provided

Message:
But the paradox of prosperity is that we are too busy to enjoy it. And the competitiveness that gooses the economy, coupled with the decline of social constraints, has conspired to make the rich much richer, he asserts, leaving most of the country behind while government safety nets get skimpier. Dr. Whybrow cites United States government statistics that are sobering. Thirty percent of the population is anxious, double the percentage of a decade ago. Depression is rising too, especially among people born after 1966, with 10 percent more reporting depression than did people born before that year. With the rise of the information age in the 1990's, when the global marketplace began staying open 24 hours a day, American mania reached full flower, Dr. Whybrow said. And now that the nation has retreated from that manic peak, we should stop and survey the damage. 'Neurobiology teaches us that we're reward-driven creatures on the one side, which is great,' he said. 'It's a fun part of life. But we also love each other and we want to be tied together in a social context. So if you know that, why aren't we thinking about a civil society that looks at both sides of the balance rather than just fostering individualism? Because fostering individualism will be great for us and it will last a little bit longer, but I believe it's a powerful negative influence upon this country and it's not what was originally intended. Should we be thinking about whether this is the society we had in mind when we started this experiment 200 years ago or are we perhaps moving too fast for our own good?' Dr. Whybrow's analysis of the mania afflicting contemporary society has been praised as acute, but he has been faulted for failing to prescribe any political or economic action as an antidote. 'Whybrow does offer an interesting version of the social and cultural contradictions of capitalism,' Michael Roth, president of the California College of the Arts, wrote in a review last month in The San Francisco Chronicle, 'but it is one that leaves us without much sense of how we might reconstruct the social and political system to create more meaningful work and a more equitable distribution of wealth and of hope.' But for Dr. Whybrow, with globalization here to stay, the solution lies with the individual: It's up to each of us to ruminate on our lives and slow down enough so that we can limit our appetites and find a better balance between work and family. He suggested following the example of a man his friend saw running along the beach: 'A high tide washed all the little fish onto the beach where they were all gasping for breath. So here's this fellow scooping up each fish and throwing them back into the sea, and my friend goes up to the fellow and says: 'This is a fruitless task. It's not going to make any difference.' And the fellow picks up a fish, throws it into the sea and says, 'To this one it does.' '

Subject: The solution of the past
From: johnny5
To: Emma
Date Posted: Sat, Mar 12, 2005 at 15:56:27 (EST)
Email Address: johnny5@yahoo.com

Message:
In the past the tower of babel had to be disperesed - we returned to small usufruct socieities where the right hand and the left hand knew what the other was doing. People were not so detached from each others needs and wants and suffering. This happened in rome as the state gave way to large farmers and land owners and those to even smaller tribes as rome fell. The head died. In the old days the rich lived just a few blocks from the poorest - now the poorest are nations away killing each other over a breadcrumb and the rich are arguing over thier spot in line at the $500 dollar restaurant in NY. The classes are becoming too divided once again perhaps. Thomas Jefferson- Self-interest, or rather self-love, or egoism, has been more plausibly substituted as the basis of morality. But I consider our relations with others as constituting the boundaries of morality. With ourselves, we stand on the ground of identity, not of relation, which last, requiring two subjects, excludes self-love confined to a single one. To ourselves, in strict language, we can owe no duties, obligation requiring also two parties. Self-love, therefore, is no part of morality. Indeed, it is exactly its counterpart. Letter to Thomas Law (1814)

Subject: Monetary Policy
From: Emma
To: All
Date Posted: Sat, Mar 12, 2005 at 13:49:27 (EST)
Email Address: Not Provided

Message:
Increasing international trade, especially with developing nations, and productivity advance have helped limit inflation. Federal Reserve policy however has certainly been effective at limiting inflation and protecting growth. The Fed has been forward looking since the days of Paul Volker, and continues to be, for that is the only way they can fill the mandate for a balance between price moderation and employment growth. As to the price indexes, neither producer nor consumer indexes show we have an inflation problem whether the overall or core data are used. Developing economic indexes is very complex, and there have been and will be modifications, but I find no reason to object to the data. The evidence of Fed effectiveness resides in gradually declining long term bond yields since 1981.

Subject: BABY-SITTING THE ECONOMY
From: Terri
To: All
Date Posted: Sat, Mar 12, 2005 at 11:42:47 (EST)
Email Address: Not Provided

Message:
http://www.pkarchive.org/ BABY-SITTING THE ECONOMY By Paul Krugman Twenty years ago I read a story that changed my life. I think about that story often; it helps me to stay calm in the face of crisis, to remain hopeful in times of depression, and to resist the pull of fatalism and pessimism. At this gloomy moment, when Asia's woes seem to threaten the world economy as a whole, the lessons of that inspirational tale are more important than ever. The story is told in an article titled 'Monetary Theory and the Great Capitol Hill Baby-Sitting Co-op Crisis.' Joan and Richard Sweeney published it in the Journal of Money, Credit, and Banking in 1978. I've used their story in two of my books, Peddling Prosperity and The Accidental Theorist, but it bears retelling, this time with an Asian twist. The Sweeneys tell the story of--you guessed it--a baby-sitting co-op, one to which they belonged in the early 1970s. Such co-ops are quite common: A group of people (in this case about 150 young couples with congressional connections) agrees to baby-sit for one another, obviating the need for cash payments to adolescents. It's a mutually beneficial arrangement: A couple that already has children around may find that watching another couple's kids for an evening is not that much of an additional burden, certainly compared with the benefit of receiving the same service some other evening. But there must be a system for making sure each couple does its fair share. The Capitol Hill co-op adopted one fairly natural solution. It issued scrip--pieces of paper equivalent to one hour of baby-sitting time. Baby sitters would receive the appropriate number of coupons directly from the baby sittees. This made the system self-enforcing: Over time, each couple would automatically do as much baby-sitting as it received in return. As long as the people were reliable--and these young professionals certainly were--what could go wrong? Well, it turned out that there was a small technical problem. Think about the coupon holdings of a typical couple. During periods when it had few occasions to go out, a couple would probably try to build up a reserve--then run that reserve down when the occasions arose. There would be an averaging out of these demands. One couple would be going out when another was staying at home. But since many couples would be holding reserves of coupons at any given time, the co-op needed to have a fairly large amount of scrip in circulation. Now what happened in the Sweeneys' co-op was that, for complicated reasons involving the collection and use of dues (paid in scrip), the number of coupons in circulation became quite low. As a result, most couples were anxious to add to their reserves by baby-sitting, reluctant to run them down by going out. But one couple's decision to go out was another's chance to baby-sit; so it became difficult to earn coupons. Knowing this, couples became even more reluctant to use their reserves except on special occasions, reducing baby-sitting opportunities still further. In short, the co-op had fallen into a recession. Since most of the co-op's members were lawyers, it was difficult to convince them the problem was monetary. They tried to legislate recovery--passing a rule requiring each couple to go out at least twice a month. But eventually the economists prevailed. More coupons were issued, couples became more willing to go out, opportunities to baby-sit multiplied, and everyone was happy. Eventually, of course, the co-op issued too much scrip, leading to different problems ... If you think this is a silly story, a waste of your time, shame on you. What the Capitol Hill Baby-Sitting Co-op experienced was a real recession. Its story tells you more about what economic slumps are and why they happen than you will get from reading 500 pages of William Greider and a year's worth of Wall Street Journal editorials. And if you are willing to really wrap your mind around the co-op's story, to play with it and draw out its implications, it will change the way you think about the world. For example, suppose that the U.S. stock market was to crash, threatening to undermine consumer confidence. Would this inevitably mean a disastrous recession? Think of it this way: When consumer confidence declines, it is as if, for some reason, the typical member of the co-op had become less willing to go out, more anxious to accumulate coupons for a rainy day. This could indeed lead to a slump--but need not if the management were alert and responded by simply issuing more coupons. That is exactly what our head coupon issuer Alan Greenspan did in 1987--and what I believe he would do again. So as I said at the beginning, the story of the baby-sitting co-op helps me to remain calm in the face of crisis. Or suppose Greenspan did not respond quickly enough and that the economy did indeed fall into a slump. Don't panic. Even if the head coupon issuer has fallen temporarily behind the curve, he can still ordinarily turn the situation around by issuing more coupons--that is, with a vigorous monetary expansion like the ones that ended the recessions of 1981-82 and 1990-91. So as I said, the story of the baby-sitting co-op helps me remain hopeful in times of depression. Above all, the story of the co-op tells you that economic slumps are not punishments for our sins, pains that we are fated to suffer. The Capitol Hill co-op did not get into trouble because its members were bad, inefficient baby sitters; its troubles did not reveal the fundamental flaws of 'Capitol Hill values' or 'crony baby-sittingism.' It had a technical problem--too many people chasing too little scrip--which could be, and was, solved with a little clear thinking. And so, as I said, the co-op's story helps me to resist the pull of fatalism and pessimism. But if it's all so easy, how can a large part of the world be in the mess it's in? How, for example, can Japan be stuck in a seemingly intractable slump--one that it does not seem able to get out of simply by printing coupons? Well, if we extend the co-op's story a little bit, it is not hard to generate something that looks a lot like Japan's problems--and to see the outline of a solution. First, we have to imagine a co-op the members of which realized there was an unnecessary inconvenience in their system. There would be occasions when a couple found itself needing to go out several times in a row, which would cause it to run out of coupons--and therefore be unable to get its babies sat--even though it was entirely willing to do lots of compensatory baby-sitting at a later date. To resolve this problem, the co-op allowed members to borrow extra coupons from the management in times of need--repaying with the coupons received from subsequent baby-sitting. To prevent members from abusing this privilege, however, the management would probably need to impose some penalty--requiring borrowers to repay more coupons than they borrowed. Under this new system, couples would hold smaller reserves of coupons than before, knowing they could borrow more if necessary. The co-op's officers would, however, have acquired a new tool of management. If members of the co-op reported it was easy to find baby sitters and hard to find opportunities to baby-sit, the terms under which members could borrow coupons could be made more favorable, encouraging more people to go out. If baby sitters were scarce, those terms could be worsened, encouraging people to go out less. In other words, this more sophisticated co-op would have a central bank that could stimulate a depressed economy by reducing the interest rate and cool off an overheated one by raising it. But what about Japan--where the economy slumps despite interest rates having fallen almost to zero? Has the baby-sitting metaphor finally found a situation it cannot handle? Well, imagine there is a seasonality in the demand and supply for baby-sitting. During the winter, when it's cold and dark, couples don't want to go out much but are quite willing to stay home and look after other people's children--thereby accumulating points they can use on balmy summer evenings. If this seasonality isn't too pronounced, the co-op could still keep the supply and demand for baby-sitting in balance by charging low interest rates in the winter months, higher rates in the summer. But suppose that the seasonality is very strong indeed. Then in the winter, even at a zero interest rate, there will be more couples seeking opportunities to baby-sit than there are couples going out, which will mean that baby-sitting opportunities will be hard to find, which means that couples seeking to build up reserves for summer fun will be even less willing to use those points in the winter, meaning even fewer opportunities to baby-sit ... and the co-op will slide into a recession even at a zero interest rate. And this is the winter of Japan's discontent. Perhaps because of its aging population, perhaps also because of a general nervousness about the future, the Japanese public does not appear willing to spend enough to use the economy's capacity, even at a zero interest rate. Japan, say the economists, has fallen into the dread 'liquidity trap.' Well, what you have just read is an infantile explanation of what a liquidity trap is and how it can happen. And once you understand that this is what has gone wrong, the answer to Japan's problems is, of course, quite obvious. So the story of the baby-sitting co-op is not a mere amusement. If people would only take it seriously--if they could only understand that when great economic issues are at stake, whimsical parables are not a waste of time but the key to enlightenment--it is a story that could save the world.

Subject: Who will watch warrens Baby?
From: johnny5
To: Terri
Date Posted: Sat, Mar 12, 2005 at 15:24:20 (EST)
Email Address: johnny5@yahoo.com

Message:
Warren wanted his baby sat - he looked at all the scripps - the futures on the scripps - the 30:1 leverage - he saw that when brittney came to town everyone was going to go out and no one would be home to watch the babies - so people rushed to cash in thier futures and get delivery - or cash in thier scripss - and no one would take a scripp because everyone was going to see brittney - and so the system collapsed and warren had no one to watch his baby - everyone had to stay home and watch thier own baby cause no one else was taking scripps anymore and brittney went broke because no one came to her concert - poor britney :(

Subject: Africa's Garment Factories
From: Emma
To: All
Date Posted: Sat, Mar 12, 2005 at 09:53:54 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/12/business/worldbusiness/12africa.html?ei=5070&en=7abbed303d42e158&ex=1111294800&pagewanted=all&position= Dollar's Fall Silences Africa's Garment Factories By MICHAEL WINES MAPUTSOE, Lesotho - Buy a T-shirt at Wal-Mart, fleece sweats at J. C. Penney or Hanes panties anywhere in the United States, and there's a halfway decent chance that they were stitched together here, in an acre-size garment factory crammed with thousands of frantically clacking sewing machines. Virtually its entire output, 25,000 items of clothing daily, is America-bound. These days, that is a disaster. 'Two thousand people work here, and unfortunately last week I had to retrench 500 people, because there are no orders,' Boodia Heman, director of the Ever Unison Garments factory, said in a recent interview. 'The American buyer is not coming to Lesotho to buy.' Actually, the problem is not so much the buyers from America. It is the American dollar, and its headlong plunge in value. Three years ago, Lesotho's garment factories had to sell only $56 worth of clothes to stores in the United States to cover the monthly wage of 650 maloti for a sewing-machine operator. Today, that same salary consumes $109 in sales. When the dollar is worth 8.5 maloti or more, Mr. Heman said, 'we break even and we are satisfied.' Right now, the weak dollar fetches less than 6 maloti. The dollar could not have shrunk at a worse time for southern Africa. In January, China's powerful apparel industry was freed from the so-called multifiber arrangement, which for decades set nation-by-nation quotas and capped its garment exports to the developed world. Now China, which keeps its currency tightly pegged to the dollar, has begun to pursue the American market much more avidly. American shoppers may register the dollar's fall, if at all, as an irritating uptick in the prices of imported goods. In tiny, dirt-poor Lesotho, it is more than an irritation; it is potentially fatal. Since December, 6 of the nation's 50 clothes factories have shut down, unable to match the prices of foreign competitors and still make a profit. That has eliminated 5,800 of the 50,000 garment-making jobs here. Layoffs have claimed at least 6,000 more. Garment makers who might otherwise decide to ride out the dollar's slide 'are starting to realize that they're losing their shirts,' said Mark Bennett, who advises the government on textile issues for the nonprofit ComMark Trust, based in South Africa, which aims to foster development. The government has stepped in, seeking to resurrect three of the closed factories and offering incentives for others. And for good reason: garment makers represent more than 9 in 10 manufacturing jobs in this impoverished nation. Those efforts largely depend, however, on the vagaries of the dollar. Garment makers here, most of them foreign-owned, say that if the dollar drops another 20 percent against the South African rand, as some economists predict, a new wave of factory closings will be inevitable. Across southern Africa, industries that depend on American customers or compete with American producers are feeling the effects of the dollar's fall. South Africa, which surrounds Lesotho, has lost an estimated 30,000 textile jobs since 2002. In neighboring Swaziland, nearly three in four textile factories say they have no firm orders beyond March.

Subject: Africa's Garment Factories - 1
From: Emma
To: Emma
Date Posted: Sat, Mar 12, 2005 at 09:55:40 (EST)
Email Address: Not Provided

Message:
South Africa's fabled gold-mining industry lost 11,000 jobs from January 2003 to June 2004, in part because income from its dollar-denominated exports fell sharply. Botswana's budget tipped from a surplus to a $325 million deficit last year as its dollar income from diamond sales was diluted by a 10 percent rise in its currency, the pula. All these nations, and nearby Namibia, share a common problem: their currencies are pegged one-to-one to South Africa's rand, which has recorded a big rise against the dollar (Botswana's pula is pegged to a basket of currencies dominated by the rand.) The euro has risen 52 percent against the dollar since February 2002, but the rand, driven by a boom in commodities like gold, has nearly doubled in value. 'The weak dollar is bad economic news for countries that are not on a dollar-parity system,' said Anthony Twine, a senior economist at Econometrix, a Johannesburg consultant. In places like Lesotho, a nation of 1.8 million that is already wrestling with AIDS and drought, the news is perhaps most wrenching. Lesotho's garment industry - and therefore its manufacturing base - rests on the faltering premise that Americans will buy all the clothes that it can sew. That premise originates in a law, the African Growth and Opportunity Act, which Congress enacted in 2000 in an effort to help sub-Saharan nations lift themselves from poverty. Nations meeting the law's criteria, which range from political pluralism to support for free markets, are allowed to export any of 1,600 products to the United States duty-free. With a progressive government and extremely low tax rates, Lesotho was one of the biggest winners: clothing exports to the United States ballooned to $500 million last year, from just $100 million in 2001 - nearly a third of all clothing exports by the 37 nations given duty-free status. The textile boom was a salvation to Lesotho, which lost 60,000 jobs in the 1990's as South Africa reduced migrant labor at its gold and coal mines. Textile factory employment rose from 20,000 jobs before the law to more than 50,000 last year. When the dollar was more robust, some companies from Taiwan built projects - modern, efficient factories and a mill to produce denim fabric - that is vital to the industry's long-term health. By late 2007, garment makers must make or buy their fabrics in sub-Saharan Africa or lose their right to ship goods duty-free to the United States. That denim mill probably assures that Lesotho's blue-jeans makers, who turn out 26 million pairs a year, will survive in some form. But the dollar's slide has damped prospects for a knitted-fabric mill. In Maputsoe, a dog-eared settlement of about 10,000, two of nine garment factories closed in December and January, leaving their workers stunned and, often, penniless. Itumeleng Khasane was in her fourth month of sewing Old Navy T-shirts at TW Garments in Maputsoe when she went to collect her paycheck on Dec. 17 during the factory's Christmas break. At her last payday in mid-November, it was clear that the factory was struggling: she received only about $54, half the wages due for a month's work. But when she arrived at the factory that day, she said recently, nobody was there. 'We didn't get our money,' she said. 'We didn't get a salary; we didn't get a holiday bonus; we didn't get a termination payment.' More recently, Ms. Khasane was standing in a crowd of women, along with a few men, outside Johnson Work Wear, a uniform maker that hired a handful of workers in January. It was, they said, their only prospect for another job. Many had arrived at dawn, carrying umbrellas to ward off the midday sun. At 21, with a seventh-grade education, Ms. Khasane had been the sole wage-earner for a family of five - two sisters, a brother and her jobless father. Her mother died in 2002 at age 38. The family gets by now on handouts. The second Maputsoe factory, Vogue Landmark Garments, shut down even more unexpectedly; workers say there was no hint of financial problems until they returned after the holiday break on Jan. 12 and found the doors locked. Masello Motsosi, a 27-year-old sewing machine repairman, was supporting his wife and two boys, his parents and his in-laws on his $135-a-month salary. He used his last savings in January to pay the boys' school fees. 'Now, there's nothing,' he said. Lesotho garment factories have closed before, and been snapped up quickly by other producers. But with the American market increasingly unprofitable, few expect that to happen this time. Nor is it easy to diversify away from United States buyers: Canada and Australia, among others, offer American-style tariff breaks, but their markets are too small to replace American orders. And the Chinese, with lower shipping costs and quicker turnaround times, loom ever larger as a competitor. In response, the nation's biggest garment makers are slashing costs - and praying for an exchange-rate turnaround. 'Denim isn't profitable right now,' said Oliver Li, the manager of the Global Textiles factory owned by the Nien Hsing Textile Company. It is one of three factories that still churn out up to 70,000 pairs of jeans daily. 'It's not only the appreciation of the rand, but other things like electricity and water,' Mr. Li said. 'They're all more expensive than before because we pay for them with our dollar income.' At its three factories in Maseru, the Taiwan-based Nien Hsing has dimmed lights, switched from cellphones to two-way radios for communications between plants and even told its staff to carpool to save gasoline. Not long ago, Lesotho government officials and textile factory managers blitzed Congress, the White House, major retailers in New York and San Francisco and a trade show in Las Vegas with a well-honed argument: Lesotho may not always be cheapest, but it is dependable, honest and squeaky clean on human rights and sweatshop issues that have embarrassed American retailers like Nike in the past. That, the nation's trade minister, Mpho Malie, says bluntly, may not always be true of certain competitors. 'We're not only talking about the quality of garments, but also the quality of workers' conditions on the factory floors - labor issues, environmental issues,' he said in an interview in his Maseru office. 'Because in the future, a client will come to you and say, Where are you sourcing from, and what are you doing about the welfare of the people you are sourcing from?' That argument seems to have won over some of the more socially conscious garment buyers in the United States, like Levi Strauss and Gap, which have maintained or increased their orders here. Whether it will play with mainstream American retailers for whom price is the bottom line is more problematic. 'As a country, we think that we are doing something right,' Mr. Malie said. 'We're saying that tomorrow, there will be questionable things about China - things that are not only a government question, but that your consumers in the long run are going to question.' He said that when the honeymoon with Chinese suppliers was over, 'those questions will have to be answered.'

Subject: Sector Stock Indexes
From: Terri
To: All
Date Posted: Sat, Mar 12, 2005 at 09:31:24 (EST)
Email Address: Not Provided

Message:
http://flagship2.vanguard.com/VGApp/hnw/FundsVIPERByName Sector Indexes 12/31/04 - 311/05 Energy 17.4 Financials -2.0 Health Care -0.8 Info Tech -5.9 Materials 5.6 REITs -6.2 Telecoms -4.4 Utilities 3.4

Subject: Vanguard Returns
From: Terri
To: All
Date Posted: Sat, Mar 12, 2005 at 09:25:36 (EST)
Email Address: Not Provided

Message:
http://flagship5.vanguard.com/VGApp/hnw/FundsByName Vanguard Returns 12/31/04 to 3/11/05 S&P Index is -0.6 Large Cap Growth Index is -2.1 Large Cap Value Index is 1.0 Mid Cap Index is 0.8 Small Cap Index is -2.0 Small Cap Value Index is -1.6 Europe Index is 3.9 Pacific Index is 2.1 Energy is 15.2 Health Care is 0.8 REIT Index is -6.3 High Yield Corporate Bond Fund is 0.7 Long Term Corporate Bond Fund is 0.6

Subject: Re: Vanguard Returns
From: johnny5
To: Terri
Date Posted: Sat, Mar 12, 2005 at 15:10:10 (EST)
Email Address: johnny5@yahoo.com

Message:
Terri what vanguard funds are you allocated into? What is your makeup between stock funds, bond funds and cash?

Subject: Monetary Policy
From: Emma
To: All
Date Posted: Sat, Mar 12, 2005 at 08:29:14 (EST)
Email Address: Not Provided

Message:
Alan Greenspan, Alan Blinder, Ben Bernanke believe the key to understanding the Federal Reserve innovation since 1987 was coming to understand that money supply guidelines for policy formation were less and less important. The need was to watch the mix of interest rates, rather than use money supply guides to short term interest rate changes. This was the critical innovation. Greenspan believes the change actually began about 1980. I completely agree. The Fed has been successful at maintaining growth with less and less inflation from Volker through Greenspan.

Subject: Re: Monetary Policy
From: Pete Weis
To: Emma
Date Posted: Sat, Mar 12, 2005 at 11:23:08 (EST)
Email Address: Not Provided

Message:
Has low 'inflation' been mostly the result of Federal Reserve actions and the 'mix of interest rates'? Or has it been mostly due to the deflationary pressures of cheap labor over seas in economies like China? What about the boost to productivity that hightech advancements added to the design and manufactured of goods - has this been a greater influence on reducing inflation for many hard goods than has Federal Reserve actions? What types of goods have experienced little inflation and why? Was it really actions taken by our central bankers since Volker's retirement? What about the increasing costs of food, housing, insurance, energy, etc. - should these be left out of the 'core' inflation rate which is the rate most often quoted? Has our federal reserve been instituting policies which have helped to guide our economy relatively smoothly through stormy seas or has it simply been reactionary to the busts of 'irrational exuberance'? In short, is our federal reserve forward looking?

Subject: competition
From: joseph hill
To: All
Date Posted: Sat, Mar 12, 2005 at 08:22:55 (EST)
Email Address: joe_hill39@yahoo.com

Message:
With the advent of plagiaristic Professor Ward Churchill, Professor Krugman has (arguably) been replaced as the farthest left whack job currently receiving media attention. Does anyone know if he has any plans to recapture his status as the icon of leftist absurdity? Joe

Subject: Ben Bernanke on the Trade Deficit
From: Emma
To: All
Date Posted: Sat, Mar 12, 2005 at 07:24:30 (EST)
Email Address: Not Provided

Message:
Ben Bernanke as far as I can tell is not adopting a political explanation. The explanation of why America is able to import saving from other countries suggests we have been able to run a persistent trade deficit because investment opportunities in America have been perceived as superior to opportunities abroad. Since we have long grown faster than the western European economies or Japan it is reasonable that investors should find opportunities here. There will be a change in time, possibly soon, possibly central banks with increasing purchases of our debt are showing the change is already on us. When the change comes the dollar will decline in value, but the decline can well be orderly and gradually lessen our trade deficit. This explanation is optimistic and there are far more worrisome descriptions of the government deficit and low household saving rate driving the trade deficit. We should think over and argue about the possibilities.

Subject: Re: Ben Bernanke on the Trade Deficit
From: Pete Weis
To: Emma
Date Posted: Sat, Mar 12, 2005 at 11:50:38 (EST)
Email Address: Not Provided

Message:
This is exactly the same line Alan Greenspan was trying to sell before Congress. But the rates on US treasuries are low and they are denominated in a dollar which has been falling at a rate of about 10% per year against a 'basket of currencies' and considerably greater against commodities. Every economist agrees that it will fall much further over the coming years. So the reason for buying US treasuries by foreign central banks is not to keep US consumers buying Asian goods as everyone else is saying - it's because it's simply a good money making investment according to Bernanke and Greenspan. Now I realize that some foreign private investors buy US corporate bonds which provide high yields. But there is a reason some US corporations pay high yields in a low interest rate environment - they have a high risk of default. So Bernanke and Greenspan believe, despite starting in a 10% annual hole, that overseas investors believe US investments are so good that they can absorb that loss and still make better gains than they would elsewhere the world?

Subject: Re: Ben Bernanke on the Trade Deficit
From: johnny5
To: Pete Weis
Date Posted: Sat, Mar 12, 2005 at 15:00:40 (EST)
Email Address: johnny5@yahoo.com

Message:
Pete you have to stop being so negative - if we can convince those 15 trillion worth of private investors to keep sending wealth here the fundamentals do not matter and warren is gonna lose his butt - only thier PERCEPTION that this is a great place to invest matters - everytime you down america you hurt us US centric investors - as long as we can get oil rich countries to give us oil for green paper we will be fine - don't rock the boat - or as you said - it will flip over and sink us even faster. I got the prospectus in for the Prudent Bear fund yesterday and am looking over their data - it seems one guy is making all the decisions - do you have any info on this guy beyond what is provided in the prospectus.

Subject: Re: Ben Bernanke on the Trade Deficit
From: Pete Weis
To: johnny5
Date Posted: Sat, Mar 12, 2005 at 23:55:13 (EST)
Email Address: Not Provided

Message:
If you are going to invest in their Bearx fund you will need to be patient through the periods of small losses before they have some big gains. They probably are a good hedge against a broad market downturn the way bond funds won't be this time around - they had a 62% gain in 2002. David Tice has been in this business since the late 80's so you would think he knows what he's doing. I've invested in his safe harbor fund (now the prudent bear global income fund) which is basically a hedge against the falling dollar. Here's some of his commentary from 1999: Prudent Bear Market Commentary Today's reports of stronger than expected productivity gains and less than expected unit labor costs will only incite more giddy chatter of a 'new era' miracle economy. Amazingly, a very strong consensus has developed that we live in a period of profound price stability, and that today's 'Internet economy' can continue at current growth rates of 5% or better without any worry of developing inflation. Yesterday on CNBC, an economist went so far as to state that with one more 25 basis point interest rate increase next week the Fed would 'nail the coffin shut on inflation.' Such talk confirms our belief that many brains are suffering from overexposure to the bull market. Today, there are truly momentous misconceptions about the true underlying health of the economy and the soundness of our financial system. Unfortunately, an historic asset bubble has not only distorted the financial system and real economy, it has worked its magic on perceptions and judgements as well. And although it is to be expected that an euphoric Wall Street would buy into 'new era' analysis, we are continually amazed that virtually the entire US economic community has followed. And while the stock market mania has certainly impaired the objectivity of analysis, it is increasingly apparent that some very serious flaws in the understanding of basic economic concepts are at play as well. Nowhere is this more apparent than in contemporary discussions of inflation. Today, the inflation debate centers almost exclusively on consumer prices. And since a designated basket of consumer goods is showing only moderate price increases, this is accepted as proof positive that Greenspan and the Federal Reserve have mastered the art of price stability. Undoubtedly, however, the great old economists, particularly from the Austrian school, would today scoff at such shallow and nonsensical analysis. Instead of a narrow focus on price changes for a basket of consumer goods, their analysis would center on the general monetary environment as the best indicator of true inherent inflationary pressures. In the past, only stable money and credit conditions would be accepted as conducive to general price stability and sound economic growth. We subscribe very strongly to the view that excessive money and credit growth invariably has inflationary manifestations that fuel dangerous financial and economic distortions. Importantly, these distortions work to disrupt market-pricing mechanisms, and can develop in various forms and with unpredictable timing. Generally, excessive money and credit creation leads to higher prices of consumer goods, asset prices and/or trade deficits. Of the three, consumer price inflation is the least dangerous, as it is both easily recognized and resolved by restrictive monetary policy. As is patently obvious today, asset inflation and trade deficits are a much different animal, as they are easily, and conveniently, identified as the outcome of anything but monetary inflation. Today, these inflationary consequences are deemed 'wealth creation' and the wonderful fruits of a miracle economy. Hence, this type of inflation is particularly problematic as it has great potential to be revered by Wall Street, investors, bankers, businessmen, politicians and the general populace, as well as being susceptible to protracted accommodation by central bankers. This is absolutely the situation today. Over time, escalating asset prices and trade deficits lead to severe distortions to both the financial system and real economy, as we have discussed in previous commentaries. Clearly, the US in the 1920's and Japan in the 1980's are examples of the seductive and destructive nature of asset inflation. With this in mind, there is absolutely no doubt that we are currently in a very dangerous inflationary environment. Sure, the extent of these powerful forces are not visible in consumer prices, but keep in mind that much of what we consume is produced elsewhere. In fact, imports of goods and services this year will total about $1.2 trillion, as our trade and current account deficits escalate to the largest levels ever. At the same time, inflationary forces could not be more conspicuous, in the data as well as in ballooning asset prices. The data presents clearly that we are in the midst of the greatest money and credit excesses in history. And, importantly, already gross excesses took a dramatic turn for the worse last year. During the eighteen months ended this past June (most recent available data), total domestic non-financial debt increased $1.553 trillion, or more than 10%. At the same time, our financial system took on unprecedented leverage. Financial sector borrowings grew $1.626 trillion, or almost 30%. Household mortgage debt increased $563 billion, while corporate debt expanded $642 billion. Since June 30, 1998, broad money supply (M3) has increased $662 billion, or almost 12%. Money market fund assets have grown $357 billion, or 30%. This unprecedented money and credit explosion has had a profound effect, adding incredible fuel to the US financial and economic bubble. Nowhere has this been more conspicuous than in the stock market, where, since the lows of early October of 1998, the Dow Jones Industrials gained 40%, the NASDAQ100 160%, the Morgan Stanley High Tech index more than 200%, the NASDAQ Telecommunications index 170%, the Philadelphia Semiconductor index 240%, and The Street.com Internet index 480%. And as we have highlighted repeatedly, residential real estate has been another major asset class to experience exceptional price inflation. Interestingly, many economists are today caught in a trap. By comparing year-over-year money supply growth, they erroneously conclude that the money supply is now expanding only moderately. We look at the numbers much differently, seeing incontrovertible evidence that an historic episode of money and credit profligacy runs unabated. Importantly, our financial system has been creating truly excessive money and credit since 1995. For example, during the first five years of this decade, total broad money supply (M3) expanded $273 billion, or about $55 billion annually. During the last five years (less the remaining two months of this year), M3 has increased by almost $2 trillion, or about $400 billion each year. Last year, M3 literally exploded, increasing $645 billion, or more than double total growth for the first five years of the decade. And while M3 growth will likely not exceed $400 billion this year, keep in mind that M3 grew by $77 billion in 1994 and $66 billion in 1993. And looking at total non-financial debt, we see growth last year exceeded $1 trillion, and is on track for similar growth this year. For comparison, non-financial debt growth averaged $571 billion during the first five years of the decade. Nowhere, however, has credit inflation run more rampant than in the reckless flood of financial credit creation. Financial system borrowings, after expanding at an average of about $285 billion annually during the first half of the decade, expanded by almost $1.1 trillion last year and are on course to surpass this during 1999. Also, margin debt, having ended 1995 at $77 billion, has surged to $180 billion. How can any serious analyst not recognize this unprecedented orgy of money and credit growth? And how can the Federal Reserve not appreciate that credit excess has fueled a massive asset bubble and bubble economy? Today, there is evidence everywhere of credit excess-induced inflationary pressures. Outside of the momentous stock market and residential real estate bubbles, we see surging prices for a wide variety of things. In past commentaries we have expounded on the major inflation taking place with media properties, particularly radio and television stations, cable franchises and professional sports teams. In this regard, we recently read that the Cleveland Indians are being sold for a record $320 million, after being purchased in 1986 for $45 million. The NFL's Washington Redskins were sold for $800 million in July. Last month, the NFL awarded an expansion franchise to Houston for $700 million, surpassing the previous record price of $530 million paid last year for a team in Cleveland. Of course, the Houston franchise owners have plans for a new $310 million stadium, with much of the financing provided by local government. Elsewhere, we see the stock market now values the World Wrestling Federation, with revenues last quarter of $76 million, at $1.6 billion. We also see that the average price for an NBA ticket for this season has increased almost 14%. The LA Lakers raised the average ticket price 60%, to almost $82. The average price for a New York Knicks ticket increased 9% to almost $87. For this season, the NBA can boast of six sparkling new arenas. Prices for NHL tickets are rising as well. Toronto, with its new $160 million AirCanada Center, now has the highest price in the league at almost $70, a 65% increase from last year. Higher ticket prices, after all, are necessary as the average NHL player salary has increased more than 50% during the past five seasons. The Wall Street financial bubble was again very prevalent during the World Series. The prices for 30-second advertisements were between $350,000 and $450,000, up from the average of about $300,000 last year. E*Trade, with its $300 million annual advertising budget, was a major advertiser, as was Fidelity and Merrill Lynch. According to the New York Times, online brokers purchased more World Series advertising than any other industry. Also, according to the Television Bureau of Advertising, brokers, insurance companies and other financial service providers bought $474 billion of network advertising during the first six months of this year, up a staggering 52% from last year. Similarly, the prices paid to rename sporting venues are rocketing. Federal Express recently agreed to pay $200 million to rename the Washington Redskin's stadium. This is inflation in its truest form and increasingly destructive to the real economy. Yet, these astonishing inflationary manifestations, apparently, do not worry Greenspan or the Federal Reserve. And as the Fed continues to sit back, relax, and watch as this wild party gets completely out of hand, Greenspan's hero status only grows by the day. Certainly, he is deserving of a hero's welcome from the folks at NASCAR. Yesterday, Fox network, NBC and Turner Sports won a bidding war by agreeing to pay $2.4 billion to broadcast NASCAR auto races for the next six years. This huge sum is four times the current contract price. Interestingly, despite all the hype, national ratings so far this year for NASCAR have increased only 1% from last year. But with so many networks competing for programming, and with money so easy to come by, rationality is clearly not the leading determinant of prices. This is the case with the NASCAR contract, with home prices in Silicon Valley, salaries for executives as well as software programmers, and, of course, a hot stock. It used to be that a common definition of inflation was 'too much money chasing too few goods.' Well, today way too much money and credit is chasing too many things. And just because the world is awash in virtually all basic consumer goods, this does not, in anyway, detract from the fact that unprecedented money and credit growth continues to feed a buying frenzy in real and financial assets. And, importantly, after years of accommodating credit excess, the Greenspan Fed must accept the fact that it has fostered the firm entrenchment of inflationary psychology, particularly in asset markets. This will prove a catastrophic error and not one easily rectified. Quite simply, the stock market has absolutely run amuck. It has come to be completely dominated by wild speculation and other distortions that make it absolutely impossible to function effectively in its critical role of capital allocation. Today, Amazon has more than double the market capitalization of Sears. Semiconductor equipment manufacturer Applied Materials, with 1999 revenues of about $4 billion, has a greater market value than Boeing with annual revenues surpassing $50 billion. The market also values UPS, this week's star IPO, at more than the entire US airline industry. And Qualcomm, with $4 billion in 12-month revenues, has a value more than one-third greater than General Motors. Let's face it, today's marketplace is no more than one big gambling parlor. And, importantly, it is certainly our view that all the fun and games and b.s. have been allowed, and seemingly encouraged, for so long that the stock market has truly passed the point of no return. As such, we simply don't see how things can return to any semblance of normalcy, except possibly after a crash or significant market washout. Quite simply, too much money has gravitated away from sound investing, choosing instead to join the teeming party of wild speculating. And since the aggressive speculators have profited most from this extraordinary mania, they have attracted immense assets, made converts out of previously prudent investors, and have come to completely rule the marketplace. This is most unfortunate. David W. Tice November 1999

Subject: Household Debt
From: Terri
To: All
Date Posted: Fri, Mar 11, 2005 at 22:09:11 (EST)
Email Address: Not Provided

Message:
The Federal Reserve governors appear convinced that households are able to handle current debt levels even if long term interest rates rise from here. I place much weight on this assessment. Though Greenspan and Bernanke are criticized on liquidity and debt issues, I find the criticism contradictory. Tightening interest rates significantly to cut liquidity will accentuate debt problems.

Subject: Re: Household Debt
From: johnny5
To: Terri
Date Posted: Sat, Mar 12, 2005 at 03:02:03 (EST)
Email Address: johnny5@yahoo.com

Message:
Terri a man came out and said he was part of assassinations of real people and part of an economic hit man team - do you think he was lying? He said our country can no longer do these types of things and was outing the government - you feel this will have no affect on our ability to stay number 1? Chavez is not drinking the american kool-aid. The congressmen of 1933 charged the 'fed' with stealing america. Congressman, Louis T. McFadden 1932 congressional record: http://www.worldnewsstand.net/today/articles/mcfadden_speech_1932.htm 'A few days ago, the President of the United States with a white face and shaking hands, went before the Senate of behalf of the moneyed interests and asked the Senate to levy a tax on the people so that foreigners might know that these United States would pay its debt to them. They are putting the United States Government in debt to the extent of $100,000,000 a week, and with the money they are buying our Government securities for themselves and their foreign principals. Our people are disgusted with the experiences of the Fed. The Fed is not producing a loaf of bread, a yard of cloth, a bushel of corn, or a pile of cordwood by its check-kiting operations in the money market. 'Recently in one of our States, 60,000 dwelling houses and farms were brought under the hammer in a single day. 71,000 houses and farms in Oakland County, Michigan, were sold and their erstwhile owners dispossessed. The people who have thus been driven out are the wastage of the Fed. They are the victims of the Fed. Their children are the new slaves of the auction blocks in the revival of the institution of human slavery. 'Is there one law for the Baltimore and Ohio Railroad and another for the hungry veterans it threw off its freight cars the other day? Is there one law for sleek and prosperous swindlers who call themselves bankers and another law for the soldiers who defended the flag? 'The R.F.C. is taking over these worthless securities from the Investment Trusts with United States Treasury money at the expense of the American taxpayer and the wage earner. 'Why should we promise to pay the debts of foreigners to foreigners? Why should the Fed be permitted to finance our competitors in all parts of the world? Do you know why the tariff was raised? It was raised to shut out the flood of Fed Goods pouring in here from every quarter of the globe- cheap goods, produced by cheaply paid foreign labor, on unlimited supplies of money and credit sent out of this Country by the dishonest and unscrupulous Fed. The people of these United States are being greatly wronged. They have been driven from their employments. They have been dispossessed from their homes. They have been evicted from their rented quarters. They have lost their children. They have been left to suffer and die for lack of shelter, food, clothing and medicine. 'Mr. Chairman, the United States is bankrupt: It has been bankrupted by the corrupt and dishonest Fed. It has repudiated its debts to its own citizens. Its chief foreign creditor is Great Britain, and a British bailiff has been at the White House and the British Agents are in the United States Treasury making inventory arranging terms of liquidations! 'Roosevelt's next haul for the International Bankers was the reduction in the pay of all Federal employees. 'Next in order are the veterans of all wars, many of whom are aged and inform, and other sick and disabled. These men had their lives adjusted for them by acts of Congress determining the amounts of the pensions, and, while it is meant that every citizen should sacrifice himself for the good of the United States, I see no reason why those poor people, these aged Civil War Veterans and war widows and half-starved veterans of the World War, should be compelled to give up their pensions for the financial benefit of the International vultures who have looted the Treasury, bankrupted the country and traitorously delivered the United States to a foreign foe.

Subject: Re: Household Debt
From: Ari
To: johnny5
Date Posted: Sat, Mar 12, 2005 at 09:49:17 (EST)
Email Address: Not Provided

Message:
When a person writes a book such as this, the person and the book are not worth even a look. Of course the writer knows no truth. The 1933 criticism of FDR by a radical Republican pretending to care for anyone other than himself is worse than laughable. Pay no attention to such fools and falseness.

Subject: Re: Household Debt
From: johnny5
To: Ari
Date Posted: Sat, Mar 12, 2005 at 14:49:16 (EST)
Email Address: johnny5@yahoo.com

Message:
Perhaps you are right Ari and all this is to be disregarded - perception of this world is very important - maybe you and i have very different perceptions of this world. After Enron and worldcom and the ongoing congressional investigations into the mutual funds and freddie and fannie accounting scandals and warren buffet saying to short the dollar and Greenspan cutting SS - why is your view of things not as negative as mine and giving this negative stuff more weight? Is congress being silly? Warren over-reacting? If a lot of people see one event as negative and others as positive and we can get to the root causes of this difference in perception then a lot of progress could be made. I blew most of this stuff off as mumbo jumbo until warren went short 2 years ago - does that not give pause to maybe reconsider some of our recent history? Thomas Jefferson was no fool Ari, he took great offense to central banking and fiat currencies - was he just an irrational hypocritical slave owner? I just watched the cspan showing the the SEC budget for 2006 yesterday, the congressmen of today had very bad things to say to the head of the SEC about oversight - how should I take that? They were not praising him for taking care of US investors - but instead attacking him vehemetly for allowing us to be suckered and funding EVIL. They showed pictures of blown up people from hind helicopters that were funded by the USA and charged halliburton with funding growth in IRAN - a terrorist enemy of our nation I thought - are they being silly? If so, why are they wasting my tax dollars with such foolishness and sillyness? If mine and warrens bearish outlook are in error and silly it would do us great service to understand why you fundamentally believe that - there have been academic papers published showing people like to fool themselves with rosy colored glasses. Most importantly with many investors here depending on getting the perception of future investors so they can have some retirement if their benefits get cut - it would be good for them to know why people like warren or myself are getting out the usa dollar and have lost faith in the fed while other people have not and disregard a lot of this negative bear talk. I would not disregard a radical republican of 1933 - the history is there to learn from - you now have a senate, house, and presidency of radical republicans and you better learn how these people think and act or you are gonna be behind the curve. These guys are dismantling the new deal of FDR - when a hit man guy says we do bad things, the leaders of those countries affirm those events as facts - we are to disregard that as a lie? Chavez is lying when he says we tried to assassinate him? His ability to affect oil is to not be considered? Perhaps I am giving far too much consideration to these negative congressmen and book authors and world events and history - I should just listen to that guy who is retiring next year - greenspan right?

Subject: Thanks
From: Ari
To: johnny5
Date Posted: Sat, Mar 12, 2005 at 18:44:58 (EST)
Email Address: Not Provided

Message:
A considered answer. Thanks. I will just add then that there was a struggle to free fiscal and monetary policy during the Depression. The Fed was overly conservative by a long way. Adding to the money supply to keep an economy healthy is just what should be done. The analysts who go on about fiat money would cripple the Fed.

Subject: 16 tons and what do you get?
From: johnny5
To: Ari
Date Posted: Sat, Mar 12, 2005 at 20:59:23 (EST)
Email Address: johnny5@yahoo.com

Message:
I agree most of what I have read says the fed being too tight caused the problem in the 20's and 30's - but that the problem was ENGINEERED - manipulated to the benefit of a few at the cost a millions of americans. We forgave war debts back then - do you think the world is going to forgive our debts today? It is only fair isn't it? Too tight and too loose can both cause calamity for the little guy - if the rich want to cause calamity for the little guy like jefferson said - first through inflation and then through deflation the little guy will lose this country. The problem being a centralized source of power is easier to manipulate through too tight or too loose damage than a power dispersed amongst the people. I get tired Ari of bailing out the LTCM richies of the world by increasing the taxes on me and my children - this happend in 1933 and still going on today. Kill the fed - not gonna happen - realize you live in a manipulated world and if the rich bankers want to make all the money and transfer all the risk to the little guy like they did earlier in this country - same old story - I owe my soul to the company store. Invest accordingly.

Subject: Emma called it
From: johnny5
To: johnny5
Date Posted: Sat, Mar 12, 2005 at 21:09:05 (EST)
Email Address: johnny5@yahoo.com

Message:
Read some of the recent posts by Emma, she makes the point - the richies are making the money - while the little guy is taking on the risk. In the article about baby sitting above it shows that too few scripps can be bad so we do need to be able to add money, I don't think terri went into how specifically it is bad with too many scripps - but the other option is what if people altogether stop taking scripps? What if the issuer of scripps is this one evil bank dude that want to take over the wealth through inflation and deflation of the scripps and control all your babies while he babysits them?

Subject: Stocks and Bonds
From: Terri
To: All
Date Posted: Fri, Mar 11, 2005 at 21:59:54 (EST)
Email Address: Not Provided

Message:
The questions now in investment seem to come down to whether long term interest rates continue to rise and whether the price of energy will have a slowing effect on growth along with higher interest rates. So, we are in a pattern similar to last year. A slightly negative stock market, with value stocks leading growth. Small stocks are weaker than large. Though mid caps are positive. Health care is positive, REITs are negative and energy is positive. International stocks are positive in domestic and dollar currencies, with value stocks leading. Long term bonds are slightly positive.

Subject: Welcome to SANTA-CLAUS.com?
From: Pancho Villa
To: All
Date Posted: Fri, Mar 11, 2005 at 20:50:36 (EST)
Email Address: nma@hotmail.com

Message:
http://www.americanprogress.org/site/pp.asp?c=biJRJ8OVF&b=397907

Subject: But didn't XOM say this was a cycle?
From: johnny5
To: All
Date Posted: Fri, Mar 11, 2005 at 18:16:04 (EST)
Email Address: johnny5@yahoo.com

Message:
Oil is infinite isn't it? The hydro-carbons will flow forever - like magic! So I got to put hydrogen in my car now - johnny5's car only runs on gas and johnny likes driving all over florida to see the attractions - a bicycle won't cut it. IEA says world must turn away from oil By Kevin Morrison and Javier Blas in London Published: March 11 2005 12:17 | Last updated: March 11 2005 12:17 The rapid rise in global oil demand should lead the industrialised world to promote alternatives to oil as well as energy conservation, the International Energy Agency said on Friday. The warning, from the West's energy policy adviser, signals a sharp turnaround by the IEA, which has previously tried to cool oil markets by blaming prices on speculators and short-term supply disruptions. “The reality is that oil consumption has caught up with installed crude and refining capacity,” the Paris-based agency said. “If supply continues to struggle to keep up, more policy attention may come to be directed at oil demand intensity in our economies and alternatives.” The agency's view carries special weight because it was created in the mid-1970s after the Arab oil embargo to advise consuming governments about energy security and how to conserve oil so as to protect their economies from fluctuations in its price. Any revival of talk about energy efficiency is likely to alarm the Organisation of Petroleum Exporting Countries, which meets next week in the Iranian city of Isfahan. The IEA's warning comes at a time when prices are close to their record nominal levels, a signal that high prices are not denting consumption. Brent, Europe's benchmark oil price, hit a record high of $54.30 a barrel this week. On Friday Brent was trading at $53.25 a barrel, up 59 cents on the day. US benchmark crude prices were 66 cents higher at $54.20. In its March report, the IEA raised its 2005 global oil demand growth forecast by 290,000 barrels a day, to 1.81m b/d, because of higher demand in the US and China, the world's two largest oil consumers. The higher forecast gave average daily consumption for 2005 of 84.3m b/d. At the same time, the world's spare refining capacity has shrunk as demand for oil products has grown faster than the addition of new capacity. In the lead-up to Friday's comments, the IEA has privately raised the question of energy efficiency with consuming governments. “We will try to drive the attention of governments to energy efficiency,” said an agency official. The agency also plans to release a report next month entitled Saving Oil In A Hurry, which will cover among other issues the topic of energy efficiency in consuming nations. Energy analysts said a new drive on energy efficiency could be difficult because most of the increase in oil consumption is in transportation, where there are few economic alternatives. In the 1970s and 1980s the focus on energy efficiency was on the industrial sector, which contributes a small proportion of new oil demand increase. The IEA's emphasis on energy efficiency was endorsed by President George W. Bush, who on Friday said conservation was a key part of his proposed energy bill. http://news.ft.com/cms/s/f20cfb8a-920d-11d9-bca5-00000e2511c8.html

Subject: Meet the Press
From: Howard
To: All
Date Posted: Fri, Mar 11, 2005 at 15:17:06 (EST)
Email Address: hjohnson@core.com

Message:
Thanks for including a link to last Sunday's show, because Krugman's cluelessness was clearly on display, particularly when he rather inarticulately tried to explain why he doesn't like Hilary Clinton for President. Apparently it's because Bill Clinton 'managed to sort of triangulate,' which seems to mean that he wasn't a hard-core, uncompromising liberal. Fortunately, Joe Klein called Krugman on his idiocy. Unfortunately, Krugman, and worse, the Democratic Party still don't get it.

Subject: Re: Meet the Press
From: Paul G. Brown
To: Howard
Date Posted: Fri, Mar 11, 2005 at 17:22:08 (EST)
Email Address: paul_geoffrey_brown@yahoo.com

Message:
Hi Howard! Sorry - I guess you must have missed the memo. 'Triangulation' is/was a political strategy advocated by Clinton advisor Dick Morris. He's recently taken to using the same language to explain George W. Bush's political success. I guess that means W 'wasn't a hard-core, uncompromising' conservative. (Now, I think Mr Morris is overstating the extent of W's triangulation, but who am I (or you) to disagree with the architect of the idea.) Now, Joe & PK did have a disagreement over the prospects of a Clinton presidency. Progressives tend to be more variable in their thinking than conservatives. But we tend to have our arguments straight up, without lying about each other, like you're lying outright when you type that PK 'doesn't like Hilary Clinton for President'. In fact, he says later 'I'm actually not opposed to her, right?'. I'm not sure what this says about clues and who has 'em. But there it is.

Subject: Re: Meet the Press
From: Howard
To: Paul G. Brown
Date Posted: Fri, Mar 11, 2005 at 21:12:34 (EST)
Email Address: hjohnson@core.com

Message:
Paul, Sorry, I'll try not to be subtle if I post here again. Of course I know all about Dick Morris and triangulation. You missed the point. Krugman doesn't like Bill Clinton's 'triangulation,' because it meant that Clinton picked up on and took the lead on popular Republican ideas such as welfare reform. Krugman is the progressive analogue of idiots such as Rush Limbaugh. If a conservative takes a position, Krugman predictably takes a position precisely 180 degrees away. Brainpower not required. Compromise is anathema. Thus, in Krugman's mind, Bill Clinton is too conservative because he triangulated. Frankly, I tired of Krugman's NYT column quickly because of his inability to think outside the 180-degree line. Heck, he's almost as bad as David Brooks. I agree with you that Morris overstates Bush's triangulation. Bush, in his own odd way, is, like Clinton, a pretty good salesman. Bush, however, doesn't bother with thinking things through, or giving a damn about the long-term consequences of what he does. But, again, that has nothing to do with my original point. Joe Klein caught Krugman at his game, and called him on it. Twice. Cheers.

Subject: Re: Meet the Press
From: Paul G. Brown
To: Howard
Date Posted: Sat, Mar 12, 2005 at 19:04:17 (EST)
Email Address: Not Provided

Message:
Howard - I'm not sure I agree completely. I mean, I don't see the position PK is 'precisely 180 degrees away' from. 'Triangulation' is a political tactic; not a policy position. In some circumstances--as when working with a Congress dominated by the other party--it makes sense. Other times it doesn't. PK even says that he 'liked the way he [Clinton] ran he [Clinton] ran the country', and as I pointed out, he 'isn't opposed' to Hillary. PK's point, as I see it, is that the tactics which Bill Clinton used and which he anticipates Hillary would also use--triangulation--would lead to all kinds of compromises with what PK (and many on the progressive side of politics) consider to be a much more radical conservative movement than existed in the 1990's. Newt never proposed gutting Social Security, for example. And its interesting to note that on issues like law and order (read: number of cops on the beat) the Bush administration has gone soft on crime. Triangulation as a political tactic would tend to lead to policy outcomes PK (and many progressives) would disagree with. Other approaches to governing--splitting the opposition by taking positions that pit religious fundamentalists against corporate interests by promoting universal health care, for example--might have better outcomes. Could PK have made his point more clearly? Sure. But does that make him 'clueless'? And if you tired of PK's column, why are you here? I've yet to tire of Brook's (or Kristol) even when I disagree with them. From time to time I wince, but I read 'em. And that little phrase 'outside the box (or line)' is rapidly becoming the bane of my existance. You haven't earnt the right to think 'outside the box' until you have demonstrated that you have a solid understanding of the box you propose to think outside of. (Help! Editor!) So Joe and PK had an exchange of words which clarified their views. I'll accept that PK was a bit inept in his presentation but I thought his observation--once it had been clarified--was an interesting take.

Subject: Re: Meet the Press
From: Howard
To: Paul G. Brown
Date Posted: Sat, Mar 12, 2005 at 21:06:03 (EST)
Email Address: hjohnson@core.com

Message:
Paul, This is nothing against you, honestly, but I'm not sure it's worth belaboring what really is a fairly minor point. I imagine that in most regards I agree with you. I only came here because I just happened across this website, gave it a quick glance and saw the MTP link. Since I'd seen the end of that particular show I knew that Krugman was, charitably, not at his best that day. So I thought I'd jump in and vent a bit, since I really don't care for Krugman. I'll begrudgingly acknowledge, however, that he did, ineptly, make a valid observation. I’m not so sure that in the grand scheme of things it’s a particularly important one. Your point about 'outside the box' is well-taken. That phrase can be almost as annoying as that darned Where's the Cheese nonsense was. Actually, I read all of David Brooks' columns, but he has recently had a tendency to make specious arguments to support putting large groups of people into very distinct boxes. His bobo book was actually pretty funny and made some sense, but he now seems to be struggling in an attempt to duplicate that success. I like Kristof a lot, Friedman is always great, and I loved Safire, even though I rarely agreed with him. Triangulation is, in a sense, just a new term for compromise. The difference is, as you essentially note, traditional compromise isn't always possible when one party dominates. It's far worse here in Ohio, where the Republicans hold every statewide office, have overwhelming majorities in both houses, and hold all but one seat on the State Supreme Court. Here, even triangulation doesn't work. I'll close by throwing something new into the mix. As background, I happen to be a very devout and active Christian who has come to deeply resent the claim that the Republican Party represents people of faith. (And the press is as responsible for fostering this claim as anyone.) All my political beliefs are supported first by my faith, and second by our Constitution. Where my faith leads me is to a place that looks vastly different from where the Republicans are going. Unfortunately, the Democratic Party, still trying its best to hold onto its traditional disparate elements, hasn't yet recognized this void in many faith communities that is begging to be filled. To wit, there is a great need for a truly prophetic voice to respond to the culture of fear that the religious right has helped GWB create. Many progressives in the political world are starting to get it, however, and I think Hillary is certainly one of them. By the way, for anyone who shares these concerns, God's Politics by Jim Wallis is an excellent articulation of the problem and some solutions. With that, I'll lay off Krugman and move on. Best wishes.

Subject: Re: Meet the Press
From: Paul G. Brown
To: Howard
Date Posted: Sun, Mar 13, 2005 at 12:58:25 (EST)
Email Address: Not Provided

Message:
Howard, not to put too fine a point on it, but you've been most Christian throughout this whole conversation. I wouldn't label myself 'devout', and would demure 'active', but I'd sign up for 'fellow traveller'. I think the perception that people of faith are innately conservative and have a 'natural home' in the GOP is a relatively recent one, and has been constructed in recent times over a very narrow range of issues. Religious zealots--and I am using the term in sense of the disciple Simon--have played an important part informing the development of progressive politics for centuries; from William Wilberforce to Rev. Martin Luther King. Even today the progressive political program is built on the roughly Christian moral foundations: care for the least among us, emphasis on the 'weighter aspects of the law', an anti materialism (camels, eyes of needles). Hey! Even environmentalism! We consider the lilies of the field! :-) Hillary C. may or may not be 'starting to get it' (she once wrote a book 'It Takes a Village' which was saturated with communitarian and approximately Christian values) but she isn't the first, and she won't be the last. I would concede that a great many progressives would do well to actually read the Bible, rather than accept the warped picture of its message(s) they see filtered through Dobson/Roberts/Phelps et al. Thanks for the interesting conversation, Howard. You ought to hang around. Being largely economists, we tend to sweat a lot about money, which, while certainly the root of all evil, is fascinating all the same. I'd appreciate your contributions. KR Pb

Subject: Re: Meet the Press
From: Howard
To: Paul G. Brown
Date Posted: Sun, Mar 13, 2005 at 20:30:14 (EST)
Email Address: hjohnson@core.com

Message:
Paul, Thank you for the interesting conversation. I really didn't intend to look back here after my first post, and each subsequent post was meant to be my last, but your compelling responses have been too good to ignore. While I certainly have an interest in economics, I have no expertise in the area, other than some training and experience with engineering economics. By day I'm a chemical engineer, and much of the rest of my time is taking up by work in the areas of peacemaking, social justice and public policy advocacy. I haven't really been particularly involved in political activism, primarily because I don't care all that much for partisan politics, but I'm recently hearing a call to become more active, for reasons I discussed previously. I think the Democratic Party has lost its way since Bill Clinton, and frankly it had been losing its way for years before Clinton. After two very weak Presidential candidates who nearly won office only because they were running against an especially weak Republican, one would hope the Party would finally start to see the light. But now the party is led by Howard Dean, who proudly boasted that his politics has nothing to do with his faith. Granted, Dean has started to utter a few of the right things with respect to transforming the Party, but he's a long way from convincing me that he's driven by values or is capable of affecting real change. You're absolutely correct that progressive politics are largely built on foundations that look very much faith-based. The problem is that while many progressives still make the connection, Democratic leadership treats the party as a collection of constituencies rather than a set of values. (Of course the party is a collection of constituencies, but it was the shared values that brought them into the party in the first place.) It’s time for me to go. Up to this point, the only posts I’ve read on this message board have been yours, and in the interest of time, that may be how it stays. But I will try to check back once in a while. Best wishes. Howard

Subject: new s&p 500
From: johnny5
To: All
Date Posted: Fri, Mar 11, 2005 at 15:08:16 (EST)
Email Address: johnny5@yahoo.com

Message:
When It's Time to Change, You've Got to Rearrange Bernie Schaeffer 3/9/2005 8:57 AM ET Equity investors are on the eve of quite a notable change in the way Standard & Poor's comprises its U.S. stock indices. At the present time, equities within all S&P indices (including the widely-followed S&P 500 Index) are weighed according to their market capitalization, or the number of outstanding shares multiplied by the shares' current price. In an effort to divvy things up a bit more fairly, S&P is instituting a gradual shift from this weighting classification to a 'free-float weighted' basis. A stock's float is defined as the number of shares outstanding that are available for public trading (i.e., not held by insiders, who are historically unlikely to unload their shares). On March 18 (next Friday), S&P indices will be arranged on a half market-cap, half float-weighted basis. The shift will conclude on September 16, when float-weighting takes over entirely. The effects of such moves are as follows: some stocks, which have a sizeable portion of their cap held by insiders, may see their SPX rankings fall, while other stocks, with market floats that are nearly equal to their total cap, could move higher on the SPX roster. As such, the days around March 18 and September 16 could endure unusual buying and selling activity, resulting in rocky trading. In short, stocks losing ground in the index could face selling pressure, while equities that increase their respective weightings may attract some additional buying power. The first table below lists the 40 stocks that will see the largest upward move within the SPX, thanks to the adjustment. The difference was derived by taking the stock's original SPX ranking (derived by market cap) and subtracting this from its new ranking (calculated by a formula that averages the stock's market cap with its 'float cap,' or the float times the stock's current price). For example, UST Inc. (UST: sentiment, chart, options) ranks at number 287 in the current index. Once the stock's float is figured into the mix, accounting for half of the formula, UST will rank number 273, an advance of 14 slots. More at the link (subscription required) http://www.schaeffersresearch.com/members/services/gold/bgscommentary.aspx?ID=65

Subject: Dollar exits?
From: johnny5
To: All
Date Posted: Fri, Mar 11, 2005 at 14:59:05 (EST)
Email Address: johnny5@yahoo.com

Message:
No Exit by Charles Mackay, Friday March 11 2005 http://wallstreetexaminer.com/ Japanese Prime Minister Junichiro Koizumi found out Thursday that there is no exit from the ad-hoc Bretton Woods II US dollar regime. Friday's edition of the Japan Times quotes Koizumi as saying, when talking to a parliamentary committee about diversifying foreign exchange assets, 'I think it's necessary to have diversity. At the same time, taking into account what is profitable and what is safe, the overall situation must be considered'. Yes, the situation that must be considered is that there is no way for Japan, China, and others like South Korea and Taiwan, to leave the dollar based currency regime. Both the Ministry of Finance and the Bank of Japan quickly discounted what Koizumi had stated, with comments like 'it would be unwise for us to be selling dollars'. Like some existential play, the actors played by the foreign central banks, can't find a way to leave the dollar regime. They are left to attack each other, over and over again. The loss of one leg of support, especially if it is from Japan or China, could bring the entire support system for the dollar crashing down. Virtually the entre world has come to realize that it is the foreign central banks of the world which hold the dollar up. This view is not shared at the Fed. Back in the states Thursday, Alan Greenspan and Ben Bernanke both made an impressive tag team performance - battering worries about the rapidly growing current account deficit. In official, but separate speeches at different locations, the duo blamed the current account deficit on excess savings and low inflation expectations. Bernanke's speech was entitled 'The Global Saving Glut and the U.S. Current Account Deficit'. The title almost says it all. Other countries are to blame here. The US is just a good place for other countries to invest. Greenspan's comments were simply called 'Globalization'. The Maestro believes that Adam Smith's 'invisible hand' remains at work on a global scale. Although he does perceive the current account as huge, the US will make a smooth transition to a lower current account deficit. Somehow. Yes, these shows will end one day, thankfully. The dollar can not survive current account deficits of over $700 billion per year indefinitely. The Asian central bankers will find a way out - eventually - and Koizumi can pursue a retirement career out of the theater. Greenspan will retire, and maybe Bernanke will just move on to the Council of Economic advisors. Meanwhile, we better all start looking for the dollar exits. posted Friday March 11, 12 27 AM ET

Subject: Americans funding hezbollah
From: johnny5
To: All
Date Posted: Fri, Mar 11, 2005 at 13:13:25 (EST)
Email Address: johnny5@yahoo.com

Message:
Right now on cspan - talking about how haliburton and others are funding the terrorists and iran and mr. sec says oh well!! just like prescott bush funded hitler - all the holocaust victims asked was that we not forget - why did we forget? House Committee Fiscal Year 2006 Securities and Exchange Commission Budget Appropriations, Science, State, Justice, and Commerce, and Related Agencies Washington, District of Columbia (United States) ID: 185861 - 03/11/2005 - 2:00 - No Sale Wolf, Frank R., U.S. Representative, R-VA Mollohan, Alan B., U.S. Representative, D-WV Donaldson, William, Chairman, Securities and Exchange Commission Mr. Donaldson testifies about operational funding for the Securities and Exchange Commission. Among the topics he is likely to address are the integrity of the securities market, federal regulation of business practices, and recent cases involving charges of corporate fraud and mismanagement.

Subject: Pathetic
From: Bobby
To: All
Date Posted: Fri, Mar 11, 2005 at 11:53:40 (EST)
Email Address: robert@pkarchive.org

Message:
So I log in to Rollcall for the first time in months today. These are the first two stories I see right next to each other. First Headline: Georgia House Passes New Map Thursday, Mar. 10; 03:45pm In a vote with national implications, the Georgia House passed a newly proposed Congressional map this afternoon, clearing a major hurdle for state Republicans seeking to undo the lines they argue were unfairly drawn by Democrats in 2001. Second Headline: Democrats Nix Illinois Remap Illinois Democrats on Capitol Hill said Wednesday they have essentially shut the door on revisiting the state’s Congressional map as a means of retaliation for GOP-led redistricting efforts elsewhere in the country, citing a lack of consensus here and back home on how to proceed.

Subject: Adaptability indeed!
From: johnny5
To: Bobby
Date Posted: Fri, Mar 11, 2005 at 12:07:11 (EST)
Email Address: johnny5@yahoo.com

Message:
There was a program on the science channel about natural arms races in mother nature - one of these arms races was between a newt and a snake in oregon I think. The newt was the most poisonous creature in the country - thousands of times more poisonous than the scientists could understand why - well they had one natural predator - this particular snake that had a resistance to this particular poison - well through natural selection the newts got more and more poisonous and the snakes are getting more and more tolerant - thier biological arms race killed several hikers that tried to eat one of those newts. And so it is with red and blue - thier arms race to stay competitive and survive is killing everyone on the outside. Our government can no longer adapt to serve the people in time with these politics - Rubin and Peterson think this can only end in a bad way.

Subject: Red Snakes eating Blue Newts
From: johnny5
To: johnny5
Date Posted: Fri, Mar 11, 2005 at 12:16:05 (EST)
Email Address: johnny5@yahoo.com

Message:
http://newsinfo.iu.edu/news/page/normal/519.html IU scientist finds snakes that are keeping pace in toxic arms race Nerve cell resistance to tetrodotoxin the key The rough-skinned newt, whose skin is poisonous enough to kill an adult human many times over if it is eaten, poses no threat to a tiny garter snake that has evolved changes in its nerves and muscles, say scientists from Indiana University and Utah State University. The researchers present new evidence in this week's Science magazine that a co-evolutionary 'arms race,' in which a western U.S. garter snake has acquired the ability to eat the mega-toxic newts, has also made the snakes physically sluggish. Their finding is among the first to link small changes in physiology to real-world species interactions in the wild. 'The newt toxin, tetrodotoxin or TTX, affects a sodium channel that the snakes' nerve and muscle cells need to function,' said IU biologist Edmund Brodie III, who directed the research. 'The snakes have evolved resistance to TTX, but the resistance itself seems to have a negative impact on the snakes' ability to crawl.' TTX is a defensive compound found in many different animals, including pufferfish, octopuses and primitive chordates called tunicates. It is used in low concentrations to treat morphine and heroine addicts, and it has been identified as Haitian voodoo's 'zombie' drug. Evolutionary biologists have long been able to see the results of arms races between predators and prey. Prey often acquire wildly exaggerated traits, such as flying fishes' airborne abilities or the porcupine's armor of quills. But the exact way predators, prey and their genes change over time during such races has largely stumped the scientists. With their new report, the researchers pinpoint a basic mechanism by which the garter snakes keep themselves alive and maintain access to a valuable food source -- even if the cost is that the snakes are a little less spry. 'Normally you might expect a highly advantageous trait -- like TTX-resistance -- to sweep the population, but that hasn't happened here,' Brodie said. 'Clearly a trade-off between the snakes' speed and their ability to resist the newt's toxin is playing a role in the variation we're seeing.' The research team examined four populations of the garter snake Thamnophis sirtalis that eat toxic newts of the genus Taricha in California, Oregon and Washington. They found not only variation in the amount of TTX produced by individual newts, but also a large variation among individual snakes in their tolerance of the newt toxin. The most resistant snakes can survive a toxin concentration 1,000 times that tolerated by the least resistant snakes. The researchers also learned that snake TTX-resistance varies geographically. Garter snakes from the Washington population tend to be more sensitive to TTX but live among newts that produce less toxin. The California garter snakes, found to be considerably more toxin-resistant than their Washington and Oregon counterparts, live among newts laden with TTX. Brodie said the garter snakes and newts provide an excellent model for researchers to learn how vastly different levels of biology interact. 'Linking evolution, ecology and physiology has been a major challenge for scientists,' Brodie said. 'But doing so allows us to start addressing some really interesting questions, such as how nerves change over evolutionary time in a particular ecological setting.' Utah State University biologists Shana Geffeney, Edmund Brodie Jr. and Peter C. Ruben also contributed to this report. Geffeney was responsible for the neurophysiological work. This research was supported by grants from the National Institutes of Health and the National Science Foundation. Citation: 'Mechanisms of Adaptation in a Predator-Prey Arms Race: TTX-Resistant Sodium Channels,' Science, Aug. 23, 2002, vol. 297, no. 5585

Subject: How Long Can G.M. Tread Water?
From: Emma
To: All
Date Posted: Fri, Mar 11, 2005 at 11:21:04 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/11/business/11auto.html?pagewanted=all&position= How Long Can G.M. Tread Water? By DANNY HAKIM DETROIT - Since the Depression, General Motors has reigned as the world's largest automaker and a pillar of American economic might. But now the company is broadly struggling and facing the humbling possibility that it will be displaced by Toyota at the top of the auto industry within a few years. General Motors, which controlled nearly half the American market as recently as the late 1970's, held about one-quarter in February. Last week, the company said that it would produce 300,000 fewer cars and trucks in North America in the first half of this year, a 10 percent drop from a year ago. Its European operations have lost money for five consecutive years and rising interest rates are expected to cool its lending division. With its shrinking profits dwarfed by those of Nissan and Toyota, G.M.'s debt is threatened with a downgrade to a junk bond rating, a move that could force it to pay more to borrow money. The company's financial health is no trivial matter. With 7,600 dealers across the country, its eight brands, from Chevrolet to Cadillac, have long been American icons. The company has operations in 32 states; in Michigan and Ohio, both G.M. and Delphi, its struggling former parts subsidiary, are top 10 employers. G.M. is also the nation's largest private health care payer, giving coverage to 1.1 million Americans. Hundreds of thousands of retirees depend on the company's pension checks. G.M. might be in better shape than it was when it lost $23 billion in 1992 and was on the brink of bankruptcy, but many analysts say it will be treading water for years to come and extending economic distress across the industrial heartland around the Great Lakes. Company executives, while acknowledging that G.M. faces serious problems, say they are confident they can weather any storm. 'We've been ahead for 73 years in a row,' Rick Wagoner, G.M.'s chief executive, said in response to a question at a January news conference about Toyota's looming presence. 'I think the betting is we'll be ahead for the next 73 years.' 'Is it a birthright?' he added. 'Absolutely not. Could we blow it next year? I doubt it. Could we blow it in 10 years? For sure. We could do anything in 10 years.' Mr. Wagoner declined to be interviewed for this article. With the company's stock down about 50 percent on his watch, his legacy is on the line, as is the company's. Five years ago, at 47, Mr. Wagoner became G.M.'s youngest chief executive. He was a protégé of John F. Smith Jr., who became chief executive after a boardroom coup in 1992. Mr. Smith pulled the company from record losses to a record profit by 1999. Mr. Wagoner did not promise to reinvent G.M. 'The state of business at General Motors Corporation is strong,' he told shareholders in 2000, adding later that the company's success 'gives us a great chance to build off what we're doing.' Today, however, many analysts say G.M. is still unable to solve some of the problems it had in 1992, namely the seemingly unstoppable surge of efficient foreign competitors like Toyota. The strategy of Mr. Wagoner, now also G.M.'s chairman, has been to continue his predecessor's work of pushing global expansion even as he is now moving to shrink G.M.'s disparate global operations into a single manufacturing, design and engineering organization. Few industry analysts call him a visionary leader, but many see him as a skilled executive who has held the company together despite being dealt a difficult hand. Others say G.M. needs a more radical approach to ensure its survival. 'It's not like this tide can't turn,' Mr. Wagoner said in January. 'It's not going to turn by cheerleading or me convincing you here; it's going to be great products. It's going to be helped if exchange rates get in line with what they should be so companies that don't need to get subsidies aren't getting them.' At 6-foot-4, Mr. Wagoner briefly played college basketball while attending Duke University and remains an avid Blue Devil fan. He has approached his job more like a coach than an authoritarian chief, assembling a management team of prominent industry executives. Mr. Wagoner is a career G.M. employee who came up through the company's huge finance operations and is not considered one of Detroit's 'car guy' executives. Filling that role is Robert A. Lutz, the 73-year-old former Chrysler president Mr. Wagoner hired in 2001 to shake up G.M.'s product development. Mr. Lutz, a former Marine who commutes to work in a copter, commands most of the company's spotlight. Far from undermining his authority, Mr. Wagoner's willingness to delegate has earned him praise. 'What's remarkable about Rick's leadership is the strength of the team that he has been able to attract,' said Mike Jackson, chief executive of AutoNation, the largest G.M. dealer. Gerald Meyers, a University of Michigan professor and the former head of American Motors, now part of DaimlerChrysler, called Mr. Wagoner 'superb,' adding that his drive to globalize could not be accomplished quickly. 'That's a long tough road and it takes almost a generation of executive teams to make that happen,' he said. The problem, he added, is 'no matter how much they are improved, there are a couple guys out there running faster.' Others are less charitable in their assessment. Sean Egan, managing director of the independent debt rating firm Egan Jones, said Mr. Wagoner was performing 'miserably,' adding that 'some drastic action is needed in the very near future to even have a chance of turning around this slow slide to irrelevance.' The prevailing view among financial analysts is that G.M. is not close to bankruptcy because it is still clinging to profitability and has more than $23 billion in cash in its automotive operations. While it has roughly $30 billion in debt, those payments are stretched out over decades. Mr. Egan thinks bankruptcy is a real possibility because, he says, G.M. can burn through large amounts of cash quickly; he does not recommend buying G.M. bonds with maturities of more than two and a half years. But Craig Hutson, an analyst at another independent bond rating firm, Gimme Credit, thinks G.M. has 'the liquidity to withstand even a worst-case draconian scenario.' Mary Ann Keller, a longtime analyst and author, said, 'they're careening from one mess to another,' adding, 'the only thing that could make things better is a major restructuring.' She says that G.M.'s management lacks urgency and cites the fact that G.M. continues to pay more than $1 billion in annual dividends, as opposed to reinvesting that money in the business. She and other analysts also say G.M.'s recent agreement to pay $2 billion to extract itself from a soured alliance with Fiat does not reflect well on management. As part of the deal in 2000, Fiat won the right to sell its troubled auto business to G.M. at any time over a period of five years. In the end, G.M. paid $4.5 billion to begin and end that bargain and largely abandon its partnership. John Casesa, an analyst at Merrill Lynch, said the Fiat deal 'came at a large cost with little benefit.' While sales globally increased last year, in G.M.'s crucial home market they continue to decline even though G.M. spends more on incentives than any other company and is adding rebates, most about $1,000, on models that have sat on dealer lots for four months. Nearly half of G.M.'s North American production capacity is either idled or being used to produce cars and trucks sold on the cheap to rental car companies, business fleets or employees and their friends and family, according to a recent Morgan Stanley report. Labor contracts forbid the company to simply close plants to address this stark inefficiency. The company also has to maintain its size so it can generate enough cash to pay for its health care and pension benefits, which cost more than $1,800 for each vehicle produced in the United States annually. Automakers based in countries with more socialized systems are not similarly burdened. In recent speeches, Mr. Wagoner has emphasized this problem, stressed the need for tort reform and criticized the Japanese government for intervening in the currency market. But critics say that many of G.M.'s biggest problems are self-inflicted and that too many of its vehicles lack the verve that once characterized American cars. To them, the revival of G.M.'s Cadillac brand after years of cultural dormancy only demonstrates that the company can do better. While G.M. has made huge strides on quality surveys by J. D. Power & Associates, the surveys also show that most of its brands lag in appeal. Only three of eight had sales growth last year - Chevrolet, Cadillac and GMC. The company has tried advertising gimmicks and brand revivals. G.M. paid to place its new Buick LaCrosse sedan on 'Desperate Housewives' and to feature Aerosmith's 'Dream On' in LaCrosse commercials, but sales of Buicks still continue to dive. Saturn, Saab, Pontiac? Revivals for all three are in various stages. Both G.M. and Ford Motor have made huge bets on sales of large sport utilities and pickup trucks in the United States, a wager that some analysts say is at risk as gas prices rise. G.M. has upped the ante by creating a new brand around Hummer, the least fuel-efficient brand in the industry. Still, G.M. executives say their fortunes will improve considerably in 2006 and 2007 as a new generation of large sport utility vehicles and large pickup trucks hits the market. In Detroit, the unfortunate measure of success is not which of the Big Three automakers is doing best, but which is doing the least badly. Three years ago, that was clearly G.M., if for no other reason than that Ford and the Chrysler division of DaimlerChrysler were losing billions of dollars. Three years later, Chrysler is on the upswing and Ford has returned to profitability, though it is hardly a picture of health. One thing Mr. Wagoner is not betting on is a government bailout, given that steel companies and airlines have been left to fend for themselves. 'That has not gone unnoticed by me and therefore motivated us to think about, well, maybe we shouldn't just wait for somebody else to fix this problem for us,' he said.

Subject: Re: How Long Can G.M. Tread Water?
From: johnny5
To: Emma
Date Posted: Fri, Mar 11, 2005 at 11:55:21 (EST)
Email Address: johnny5@yahoo.com

Message:
Remember as Pete posted GM and Ford were 2 huge backers of that new bankruptcy reform bill that is gonna shaft poor americans. And like Emma said they are passing the buck down. http://www.stpetetimes.com/2003/04/20/Columns/_Money_market__doesn_.shtml Money market investments may offer paltry yields, but at least they are safe -- or so we hope. But that's no longer something we can take for granted when we see the phrase 'money market.' A reader recently raised the question regarding his investment in the Ford Money Market Account, which has a juicy yield of 3 to 3.4 percent, depending on account size. 'Has any money market fund failed in the last 20 years?' he asked. The answer is 'no,' but the question was the wrong one to ask. The Ford Money Market Account is neither a money market mutual fund, which legally would have to be diversified, nor a bank money market account, which would carry FDIC insurance. So what is it? A convenient way to lend money to Ford, the automaker. As Ford Financial explains on its Web site, 'Your funds are used to purchase demand notes issued by Ford Motor Credit Co.' The account offers above-average yields because it carries above-average risks. The auto industry is suffering from the downturn in the economy, and Ford's credit rating is being closely watched. Ford may very well make good on its obligations, but investors need to be aware of the risks. An account like this isn't the place to stash your entire life savings. A good rule of thumb is that investors should not have more than 10 percent of their money in the securities of any single issuer -- and a 5 percent limit is even safer. Ford stock, the Ford Money Market Account and other Ford debt should be counted together to apply the limits. Mutual funds are already diversified, so defaults pose much less risk. But even some money market mutual funds would have suffered losses in the past had their sponsors not stepped in and bailed them out. That's a reason not to have all your eggs in one or two baskets, even if those baskets are traditionally safe money market funds

Subject: Five Years After the Bubble
From: Emma
To: All
Date Posted: Fri, Mar 11, 2005 at 11:18:31 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/11/business/11norris.html Five Years After the Bubble, Have Its Lessons Been Forgotten? By FLOYD NORRIS FIVE years later, the great bubble of 2000 does not look so bad. The conventional wisdom now is that it was not all that important, certainly nothing like the great bubbles of 20th-century stock market history, those of the United States in 1929 and Japan in 1989. But there are similarities indicating that it could be a very long time before technology stocks as a group become good long-term investments again. First, look at the differences. In 1929, the world economy entered the Great Depression. In 1990, Japan began a long period of poor economic performance. It was not a depression, but there has yet to be a period of sustained growth there since the end of the bubble. The United States bubble in 2000 was different both in breadth and in economic impact. That bubble did not infect the entire stock market, but instead was concentrated in technology stocks, with a lesser bubble in the largest stocks, the ones that dominated the Standard & Poor's index of 500 stocks. The economic aftermath included only a mild recession and a slow recovery. When the bubble was at its peak, the Federal Reserve chairman, Alan Greenspan, turned aside advice, some of it from this column, that he should do something to restrain the speculation. He offered a confident forecast that if and when the bubble did burst, he would know what to do to minimize the damage. And he seems to have been right, even if some fear that superlow interest rates simply created another bubble, this one in home prices. The image of a bubble bursting is not a perfect one. Any child knows that soap bubbles blown into the air seem to float along, and then suddenly vanish. They do not shrink, and they do not reinflate. But the history of stock market bubbles is different. Charles P. Kindleberger, the M.I.T. economist whose book 'Manias, Panics and Crashes' remains the best work on the subject, notes that the path down from a peak is neither sudden nor straight. Instead, investors come back to be disappointed time and again. When all are dismayed, prices can be low enough to prompt another great bull market. But that can take a very long time. How long? Adjusted for inflation, the Dow Jones industrial average was below its 1929 peak in the early 1990's. (That calculation uses the consumer price index, which is by no means a perfect measure of inflation and is not adjusted to reflect dividend payments. But it provides a rough approximation of the purchasing power of a basket of stocks in different eras.) While many American stocks are higher than they were in 2000, the area where the frenzy was greatest remains low. Adjusted for inflation, the Nasdaq 100 is off about 70 percent from its peak. That performance is quite similar to the one turned in by the Dow industrials in the first five years after 1929, and worse than the performance of the Nikkei 225 after 1989. When the stock market fell to its post-bubble lows in late 2002, there was much talk that the lesson was that even if a technology is revolutionizing the world, the profits are more likely to go to those who use the technology than to those who develop it. Now investors are back buying hot technology stocks, and that lesson appears to be forgotten. That is perfectly consistent with the history of previous bubbles. The second five years after a historic high can produce some big gains, but they can also produce losses that wipe out those gains. Technology investing in the next five years may be more exciting than profitable.

Subject: Re: Five Years After the Bubble
From: william bishop
To: Emma
Date Posted: Fri, Mar 11, 2005 at 12:47:13 (EST)
Email Address: d2wob22@efn.org

Message:
http://www.nytimes.com/2005/03/11/business/11norris.html Five Years After the Bubble, Have Its Lessons Been Forgotten? By FLOYD NORRIS FIVE years later, the great bubble of 2000 does not look so bad. The conventional wisdom now is that it was not all that important, certainly nothing like the great bubbles of 20th-century stock market history, those of the United States in 1929 and Japan in 1989. But there are similarities indicating that it could be a very long time before technology stocks as a group become good long-term investments again. First, look at the differences. In 1929, the world economy entered the Great Depression. In 1990, Japan began a long period of poor economic performance. It was not a depression, but there has yet to be a period of sustained growth there since the end of the bubble. The United States bubble in 2000 was different both in breadth and in economic impact. That bubble did not infect the entire stock market, but instead was concentrated in technology stocks, with a lesser bubble in the largest stocks, the ones that dominated the Standard & Poor's index of 500 stocks. The economic aftermath included only a mild recession and a slow recovery. When the bubble was at its peak, the Federal Reserve chairman, Alan Greenspan, turned aside advice, some of it from this column, that he should do something to restrain the speculation. He offered a confident forecast that if and when the bubble did burst, he would know what to do to minimize the damage. And he seems to have been right, even if some fear that superlow interest rates simply created another bubble, this one in home prices. The image of a bubble bursting is not a perfect one. Any child knows that soap bubbles blown into the air seem to float along, and then suddenly vanish. They do not shrink, and they do not reinflate. But the history of stock market bubbles is different. Charles P. Kindleberger, the M.I.T. economist whose book 'Manias, Panics and Crashes' remains the best work on the subject, notes that the path down from a peak is neither sudden nor straight. Instead, investors come back to be disappointed time and again. When all are dismayed, prices can be low enough to prompt another great bull market. But that can take a very long time. How long? Adjusted for inflation, the Dow Jones industrial average was below its 1929 peak in the early 1990's. (That calculation uses the consumer price index, which is by no means a perfect measure of inflation and is not adjusted to reflect dividend payments. But it provides a rough approximation of the purchasing power of a basket of stocks in different eras.) While many American stocks are higher than they were in 2000, the area where the frenzy was greatest remains low. Adjusted for inflation, the Nasdaq 100 is off about 70 percent from its peak. That performance is quite similar to the one turned in by the Dow industrials in the first five years after 1929, and worse than the performance of the Nikkei 225 after 1989. When the stock market fell to its post-bubble lows in late 2002, there was much talk that the lesson was that even if a technology is revolutionizing the world, the profits are more likely to go to those who use the technology than to those who develop it. Now investors are back buying hot technology stocks, and that lesson appears to be forgotten. That is perfectly consistent with the history of previous bubbles. The second five years after a historic high can produce some big gains, but they can also produce losses that wipe out those gains. Technology investing in the next five years may be more exciting than profitable.
---
The trouble with all this is 'What is Money'. The printing of money is supposed to be the prerogative to the USGov. The BUBBLES are nothing more or less than the printing of money called Stock Certificates and lo and behold these Certificates fluctuate in value according to the dictates of the Exchanges. The old system was the Gold Standard. Under that system the Banks could loan five times the value of the Gold they held in their vaults. Then whenever they decided they didn't have enough Gold to cover they would declare default or bankruptcy and the Depositors were out their Gold. Hey that sounds strangely like the Stock Exchanges. JK Galbraith,s book on Money was a beginning primer on money for me as was the book on 'Gold' by a New York banker. But a couple of things that were more enlightening for me was taking us off the Gold Standard by Nixon and Paul Krugman's story about the Washington DC Babysitting group who when they ran out of script, just printed some more. I understand he recommended that system to the Japanese Govt and it didn't work too well. My own take on all this is that money is not a thing but a belief or an idea; the willingness of people to accept some medium of exchange for something someone else wants, simple as that. Now that the latest news indicates a growing unwillingness to accept Dollars our line of 'Credit' (Money?) is drying up; in other words the Dollar is a Bubble!

Subject: Kindleberger
From: johnny5
To: Emma
Date Posted: Fri, Mar 11, 2005 at 11:44:46 (EST)
Email Address: johnny5@yahoo.com

Message:
He was going to write a book on the current housing boom before he left us. Google at its current levels makes no sense to me. Still the hedge fund guys in west palm that shorted it are broke now. In japan people are holding yen and not buying anything, the deflation of assets makes holding cash the best investment.

Subject: Teaching Samba to G.M. Brazil
From: Emma
To: All
Date Posted: Fri, Mar 11, 2005 at 11:17:09 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/11/business/worldbusiness/11brazil.html?pagewanted=all&position= Teaching Some New Samba Steps to G.M. Brazil By TODD BENSON SÃO PAULO, Brazil - Since taking over at General Motors in Brazil just over a year ago, Ray G. Young has given the country's automobile industry a lot to talk about. In October, Mr. Young became the impromptu star of São Paulo's auto show when he danced enthusiastically to the Paul Rodgers song 'All Right Now' as G.M. showcased its latest vehicles. And last month, the Brazilian media published pictures of him trying out some samba steps at a celebration of G.M.'s 80th anniversary in the country. But his penchant for dancing is not the only thing attracting attention. With his youthful energy and hands-on management style, the 43-year-old managing director has helped breathe new life into a downtrodden, money-losing operation. Last year, though the unit did not manage a profit, it did claw its way to the top of Brazil's volatile auto market in sales volume for the first time, increased exports aggressively and moved closer to turning a profit - all while adding jobs. For G.M., the world's No. 1 automaker, this rebound in Brazil, its sixth-largest market, has been a bright spot as the company extricates itself from a soured alliance with Fiat of Italy and continues to atrophy in its biggest markets, the United States and Europe. Still, sales numbers in Brazil sank in January, and G.M. abruptly fell back into third place, behind Volkswagen and Fiat, respectively. The Ford Motor Company, traditionally in fourth place in Brazil, held steady in that slot. 'Clearly the January market share is disappointing,' Mr. Young said. 'It puts us in a bit of a hole right now in 2005, but I'm confident we're going to come back.' Sales numbers for February showed G.M. already closing the gap again on its rivals. Part of G.M.'s success here in 2004 was driven by Brazil's strong economic rebound, which helped woo consumers into showrooms for the first time in years. Auto sales in the country shot up 10.5 percent, to 1.6 million vehicles, with all major manufacturers chalking up hefty gains. Nevertheless, many industry analysts say that Mr. Young also deserves lots of credit for the turnaround at General Motors do Brasil. 'He has brought a sense of purpose to General Motors that they didn't seem to have before,' said Ricardo Durazzo, a vice president at the consulting firm A. T. Kearney in São Paulo. 'He is charismatic and he's a likable person,' Mr. Durazzo added, important qualities in Brazil. In an interview at the company's headquarters in São Caetano do Sul, an industrial hub outside São Paulo, Mr. Young said: 'When I arrived here, it was an organization that was a little tired. It went through so many years of retrenchment, cost-cutting, in order to stop the financial bleeding. So one of my first priorities when I came here was to try to rebuild morale.' He came to Brazil with 18 G.M. years under his belt, his entire professional career. The son of Chinese émigrés to Canada, Mr. Young joined G.M.'s Canadian unit in 1986 after receiving his M.B.A. from the University of Chicago, and quickly climbed the corporate ladder. Over the years, he held posts on three continents, spending much of his time on the financial side, crunching numbers most recently in Detroit as G.M. North America's chief financial officer. Here in Brazil, where he succeeded Walter Wieland, a more somber executive whose tenure coincided with a slumping auto market, Mr. Young set out to rally his troops around two objectives: achieving market leadership and becoming profitable. He started distributing monthly assessments to all employees, including factory workers, so everyone could keep track of the company's performance. He also began holding ceremonies to thank employees publicly for their work. The work force has responded in kind; on a recent stroll through a factory, workers stopped him to ask for an autograph. 'I've had the chance to work around the world, but one thing about Brazil is you've got to appeal to the emotions,' Mr. Young said. 'It's amazing what happens when people feel proud working for the company.' Volkswagen and Fiat have long battled for the top spot in Brazil. But in Mr. Young's first year on the job, G.M. edged out both to finish 2004 as the market leader, with 23.1 percent of Brazil's auto market. G.M.'s exports from Brazil, a growing part of its business here, also surged in 2004, to $1.6 billion, from $1.2 billion in 2003 and just $900 million in 2002. Like other major multinational automakers, which make up the entire auto market here, G.M. is increasingly using Brazil to make low-cost vehicles for other emerging markets, including Argentina, Mexico and South Africa. Though the company does not break out financial results by country in Latin America, Mr. Young said G.M. cut its losses in Brazil by more than 60 percent in 2004 and made an operating profit in the fourth quarter. That helped G.M.'s Latin America, Africa and Middle East division earn $85 million last year after losing $331 million in 2003. This year, Mr. Young expects G.M. to make its first net profit in Brazil since 1997. Still, the resurgence in Brazil has not been without controversy. Some industry analysts say the automaker won market leadership last year only because G.M. dealers preregistered new cars in December before they had actually been sold, a common practice among dealers in Brazil. G.M. sold a mere 15,796 vehicles in January 2005, down from 44,557 in December and from 23,833 in January 2004, according to the Brazilian automakers' association. (By comparison, Volkswagen's sales dropped to 25,927 in January from 36,120 in December, while Fiat's slipped to 24,647 from 37,468.) 'Why did the numbers drop so much?' said Joel Leite, who owns a Web site called Autoinforme that tracks Brazil's auto sector. 'Because G.M. dealers sold cars in January that they had already registered as sold in December.' He added that the practice, while frowned upon, is not illegal. Mr. Young denied any preregistration or year-end sales inflation, saying, 'We don't do that.' He attributed the company's poor performance in January, in the slow summer season here, to a miscalculation that led to a drop in Internet and direct-from-the-factory fleet sales. G.M. shifted almost all its vehicles to dealer lots in December, he said, leaving too few to be sold over the Web and to fleet customers the next month. G.M.'s sales bounced back in February, jumping by 6,823 vehicles from the previous month, to 22,619. Fiat and Volkswagen, meanwhile, increased sales by just 2,446 and 854 autos from January, respectively. The parent company appears confident that 2004 was not a fluke. It is spending $240 million to increase capacity at the G.M. plant in Gravataí, in the southern state of Rio Grande do Sul, where it intends to create 1,500 new jobs by the end of 2006. And recently it announced plans to invest about $192 million to develop a new version of its Chevrolet Vectra sedan at its São Caetano plant for the domestic and export markets. Already, G.M. is the only automaker in Brazil offering models in all market segments, from its big-selling Celta compact to the popular Meriva minivan. Still, obstacles lie ahead for all carmakers here. The sales tax on vehicles in Brazil, about 30 percent, is twice that of other emerging markets, like China, forcing up the price on new cars in a country where the minimum wage is less than $100 a month. Interest rates are among the world's highest, making consumer financing largely unaffordable. Parts makers also have limited access to credit, and that interferes with production each year. And the Brazilian currency, the real, has rallied in the last few months to its strongest level in almost three years, gnawing away at profit margins for exporters. Mr. Young and his competitors are lobbying the government to reduce auto taxes and lower interest rates, and to create special credit lines for small-scale parts manufacturers. 'It's a tough place to sell cars and make money,' Mr. Young said. 'You have to be nimble on your feet.'

Subject: Allez les verts!!!!
From: Setanta
To: All
Date Posted: Fri, Mar 11, 2005 at 11:05:57 (EST)
Email Address: Not Provided

Message:
I know this is a financial/political discussion board but i'd like to take this opportunity to wish the Irish Rugby team the best of luck against the French tomorrow. Rugby is the only sport and occasion where the entire island of Ireland is united. both Southern Catholics and Northern Protestants don the green jersey with the shamrock crest when ireland as a nation and undivided is represented internationally on the field. our results so far in the 6 Nations Championship: Ireland 28 - 17 Italy Ireland 40 - 13 Scotland Ireland 19 - 13 England ...the Grand Slam is still on the cards and should we win tomorrow, we will meet Wales on saturday week for the Grand Slam Decider (Wales are unbeaten too). Allez les verts!!!! Ireland's Call Come the day And come the hour Come the power and the glory We have come to answer Our country's call... From the four proud provinces of Ireland Chorus Ireland, Ireland Together standing tall Shoulder to shoulder We'll answer Ireland's call. From the mighty Glens of Antrim From the rugged hills of Galway From the walls of Limerick And Dublin Bay From the four proud provinces of Ireland (chorus) Hearts of steel And heads unbowing Vowing never to be broken We will fight, until We can fight no more... For the four proud provinces of Ireland. (chorus) ....and i've got a ticket!!!!

Subject: The Flow of Credit: Ben Bernanke
From: Emma
To: All
Date Posted: Fri, Mar 11, 2005 at 06:18:10 (EST)
Email Address: Not Provided

Message:
http://www.federalreserve.gov/boarddocs/speeches/2005/200503102/default.htm March 10, 2005 Ben S. Bernanke: 'To be more specific, I will argue that over the past decade a combination of diverse forces has created a significant increase in the global supply of saving--a global saving glut--which helps to explain both the increase in the U.S. current account deficit and the relatively low level of long-term real interest rates in the world today. The prospect of dramatic increases in the ratio of retirees to workers in a number of major industrial economies is one important reason for the high level of global saving. However, as I will discuss, a particularly interesting aspect of the global saving glut has been a remarkable reversal in the flows of credit to developing and emerging-market economies, a shift that has transformed those economies from borrowers on international capital markets to large net lenders.'

Subject: The Flow of Credit
From: Emma
To: Emma
Date Posted: Fri, Mar 11, 2005 at 06:25:40 (EST)
Email Address: Not Provided

Message:
http://www.federalreserve.gov/boarddocs/speeches/2005/200503102/default.htm March 10, 2005 The Global Saving Glut and the U.S. Current Account Deficit By Ben S. Bernanke Sandridge Lecture, Virginia Association of Economics On most dimensions the U.S. economy appears to be performing well. Output growth has returned to healthy levels, the labor market is firming, and inflation appears to be well controlled. However, one aspect of U.S. economic performance still evokes concern among economists and policymakers: the nation's large and growing current account deficit. In the first three quarters of 2004, the U.S. external deficit stood at $635 billion at an annual rate, or about 5-1/2 percent of the U.S. gross domestic product (GDP). Corresponding to that deficit, U.S. citizens, businesses, and governments on net had to raise $635 billion on international capital markets.1 The current account deficit has been on a steep upward trajectory in recent years, rising from a relatively modest $120 billion (1.5 percent of GDP) in 1996 to $414 billion (4.2 percent of GDP) in 2000 on its way to its current level. Most forecasters expect the nation's current account imbalance to decline slowly at best, implying a continued need for foreign credit and a concomitant decline in the U.S. net foreign asset position. Why is the United States, with the world's largest economy, borrowing heavily on international capital markets--rather than lending, as would seem more natural? What implications do the U.S. current account deficit and our consequent reliance on foreign credit have for economic performance in the United States and in our trading partners? What policies, if any, should be used to address this situation? In my remarks today I will offer some tentative answers to these questions. My answers will be somewhat unconventional in that I will take issue with the common view that the recent deterioration in the U.S. current account primarily reflects economic policies and other economic developments within the United States itself. Although domestic developments have certainly played a role, I will argue that a satisfying explanation of the recent upward climb of the U.S. current account deficit requires a global perspective that more fully takes into account events outside the United States....

Subject: Re: The Flow of Credit
From: Pete Weis
To: Emma
Date Posted: Fri, Mar 11, 2005 at 10:23:33 (EST)
Email Address: Not Provided

Message:
Clearly Bernanke is getting ready to minimize Bush administration and Federal Reserve responsibilities regarding the budget deficit's and current account deficit's powerful downward effect on the US dollar.

Subject: Understand and Argue
From: Emma
To: Pete Weis
Date Posted: Fri, Mar 11, 2005 at 11:01:07 (EST)
Email Address: Not Provided

Message:
What is most important is for us to understand how our most important central bankers are thinking. These are our most important central bankers, and there is reason to believe they well reflect the Federal Reserve policy makers. We can argue, but we have to understand.

Subject: Absolutely
From: Pete Weis
To: Emma
Date Posted: Fri, Mar 11, 2005 at 15:19:11 (EST)
Email Address: Not Provided

Message:
But what I've gathered from Bernanke's statements in the past would be that he believes we should continue down the same course we are headed presently. He seems to be focusing on outside factors as a cause for our current account deficit. While what he says certainly has some truth, he is ignoring, to some degree, internal factors which we might be able to do something about - an aggressive energy policy which might reduce our consumption and dependency on oil for instance. He has always pushed for pumping liquidity and so he has a tendency to downplay the dangers of growing debt. I have a feeling the Bush administration will find much comfort in his statements.

Subject: Globalization: Alan Greenspan
From: Emma
To: All
Date Posted: Fri, Mar 11, 2005 at 06:03:31 (EST)
Email Address: Not Provided

Message:
http://www.federalreserve.gov/boarddocs/speeches/2005/20050310/default.htm March 10, 2005 Remarks by Chairman Alan Greenspan Globalization At the Council on Foreign Relations The U.S. economy appears to have been pressing a number of historic limits in recent years without experiencing the types of financial disruption that almost surely would have arisen in decades past. This observation raises some key questions about the longer-term stability of the U.S. and global economies that bear significantly on future economic developments. Among the limits that we have been pressing against are those in our external and budget balances. In the United States, we have been incurring ever-larger trade deficits, with the broader current account measure moving into the neighborhood of 6 percent of our gross domestic product. Yet the dollar's real exchange value, despite its recent decline, remains above its 1995 low. Meanwhile, we have moved from a budget surplus in 2000 to a deficit that is projected by the Congressional Budget Office to be around 3-1/4 percent of GDP this year. In addition, we have enacted commitments to our senior citizens that, given the impending retirement of our huge baby-boom generation, will create significant fiscal challenges in the years ahead. Yet the yields on Treasury notes maturing a decade from now remain at low levels. Nor are households experiencing inordinate financial pressures as a consequence of record-high levels of household debt relative to income. *** Has something fundamental happened to the U.S. economy that enables us to disregard all the time-tested criteria for assessing when economic imbalances become worrisome? Regrettably, the answer is no; the free lunch has still to be invented. We do, however, seem to be undergoing what is likely, in the end, to be a one-time shift in the degree of globalization and innovation that has temporarily altered the specific calibrations of those criteria. Globalization has altered the economic frameworks of both advanced and developing nations in ways that are difficult to fully comprehend. Nonetheless, the largely unregulated global markets, with some notable exceptions, appear to move smoothly from one state of equilibrium to another. Adam Smith's 'invisible hand' remains at work on a global scale. Because of deregulation, increased innovation, and lower barriers to trade and investment, cross-border trade in recent decades has been expanding at a far faster pace than GDP. As a result, many economies are increasingly exposed to the rigors of international competition and comparative advantage. In the process, lower prices for some goods and services produced by our trading partners have competitively suppressed domestic price pressures. Production of traded goods and services has expanded rapidly in economies with large, low-wage labor forces. Most prominent are China and India, which over the past decade have partly opened up to market forces, and the economies of central and eastern Europe, which were freed from central planning by the fall of the Soviet empire. The consequent significant additions to world production and trade have clearly put downward pressure on prices in the United States and in the economies of our trading partners. Over the past two decades, inflation has fallen notably, virtually worldwide, as has economic volatility. Although a complete understanding of the reasons remains elusive, globalization and innovation would appear to be essential elements of any paradigm capable of explaining the events of the past ten years. If this is indeed the case, because the extent of globalization and the speed of innovation are limited, the current apparent rapid pace of structural shift cannot continue indefinitely. While the outlook for the next year or two seems reasonably bright, the outlook for the latter part of this decade remains opaque because it is uncertain whether this transitional paradigm, if that is what it is, is already far advanced and about to slow, or whether it remains in an early, still-vibrant stage of evolution. *** Globalization--the extension of the division of labor and specialization beyond national borders--is patently a key to understanding much of our recent economic history. With a deepening of specialization and a growing capacity to conduct transactions and take risks throughout the world, production has become increasingly international.1 The pronounced structural shift over the past decade to a far more vigorous and competitive world economy than that which existed in earlier post-World War II decades apparently has been adding significant stimulus to world economic activity. This stimulus, like that which resulted from similar structural changes in the past, is likely a function of the rate of increase of globalization and not its level. If so, such impetus would tend to peter out as we approach the practical limits of globalization. Full globalization, in which production, trade, and finance are driven solely by risk-adjusted rates of return and in which risk is indifferent to distance and national borders, will likely never be achieved. The inherent risk aversion of people, and the home bias that is one manifestation of that aversion, will limit how far globalization can proceed. But because so much of our recent experience has little precedent, as I noted earlier, we cannot fully determine how long the current globalization dynamic will take to play out. And even then we have to be careful not to fall into the trap of equating the achievement of full globalization with the exhaustion of opportunities for new investment. The closing of our frontier at the end of the nineteenth century, for example, did not signal the onset of a new era of economic stagnation. *** The increasing globalization of the post-World War II era was fostered at its beginnings by the judgment that burgeoning prewar protectionism was among the primary causes of the depth of the Great Depression of the 1930s. As a consequence, trade barriers began to fall after the war. Globalization was enhanced further when the inflation-ridden 1970s provoked a rethinking of the philosophy of economic policy, the roots of which were still planted in the Depression era. In the United States, that rethinking led to a wave of bipartisan deregulation of transportation, energy, and finance. With respect to macropolicies, there was a growing recognition that inflation impaired economic performance.2 Moreover, a tightening of monetary policy, and not increased regulation, came to be seen by the end of that decade as the only viable solution to taming inflation.3 Of course, the startling recovery of war-ravaged West Germany following Ludwig Erhard's postwar reforms, and Japan's embrace of global trade, were early examples of the policy reevaluation process. It has taken several decades of experience with markets and competition to achieve an unwinding of regulatory rigidities. Today, privatization and deregulation have become almost synonymous with 'reform.' *** By any number of measures, globalization has expanded markedly in recent decades. Not only has the ratio of international trade in goods and services to world GDP risen steadily over the past half-century, but a related measure--the extent to which savers reach beyond their national borders to invest in foreign assets--has also risen. Through much of the post-World War II years, domestic saving for each country was invested predominantly in its domestic capital assets, even when there existed the potential for superior risk-adjusted returns from abroad. Because a country's domestic saving less its domestic investment is essentially equal to its current account balance, such balances, positive or negative, were therefore generally modest, with the exception of the mid-1980s. But in the early 1990s, 'home bias' began to diminish appreciably, and, hence, the dispersion of current account balances among countries has increased markedly. The widening current account deficit in the United States has come to dominate the tail of the distribution of external balances across countries. Nonetheless, the worldwide dispersion of current account balances has risen since the early 1990s, even excluding the United States. 4 Thus, the decline in home bias, or its equivalent, expanding globalization, has apparently enabled the United States to finance and, hence, incur so large a current account deficit. As a result of these capital inflows, the ratio of foreign net claims against U.S. residents to our annual GDP has risen to approximately one-fourth. While some other countries are far more in debt to foreigners, at least relative to their GDPs, they do not face the scale of international financing that we require. A U.S. current account deficit of 6 percent of GDP would probably not have been readily fundable a half-century ago or perhaps even a couple of decades ago.5 The ability to move that much of world saving to the United States in response to relative rates of return almost surely would have been hindered by the far-lesser degree of both globalization and international financial flexibility that existed at the time. Such large transfers would presumably have induced changes in the prices of assets that would have proved inhibiting. Nonetheless, we have little evidence that the economic forces that are fostering international specialization, and hence cross-border trade and increasing dispersion of current account balances, are as yet diminishing. To be sure, as I pointed out earlier this year, we may be approaching a point, if we are not already there, at which exporters to the United States, should the dollar decline further, would no longer choose to absorb a further reduction in profit margins. An acceleration of U.S. import prices, of course, would impede imports and give traction to the process of adjustment in our trade balance. Moreover, international investors, private and official, faced with an increasing concentration of dollar assets in their portfolios, will at some point choose greater balance in their asset accumulation. That shift, over time, would likely induce contractions in both the U.S. current account deficit and the corresponding current account surpluses of other nations. To date the proportional shift out of dollars from the total of official and private sector foreign currency accounts has been modest, when adjusted for exchange rate changes.6 Of course, the shift has been larger on an unadjusted dollar equivalent basis. However, the market has absorbed this change in an orderly manner. The more-rapid aging of European and Japanese populations relative to the aging of the U.S. population should slow the flow of foreign saving available to the United States. Although those population dynamics are already in train, little evidence as yet of slowed savings transfers has surfaced. *** Can market forces incrementally defuse a buildup in a nation's current account deficit and net external debt before a crisis more abruptly does so? The answer seems to lie with the degree of market flexibility. In a world economy that is sufficiently flexible, as debt projections rise, product and equity prices, interest rates, and exchange rates presumably would change to reestablish global balance. We may not be able to usefully determine at what point foreign accumulation of net claims on the United States will slow or even reverse, but it is evident that the greater the degree of international flexibility, the less the risk of a crisis.7 Should globalization continue unfettered and thereby create an ever-more flexible international financial system, history suggests that current account imbalances will be defused with modest risk of disruption. Two Federal Reserve studies of large current account adjustments in developed countries, the results of which are presumably applicable to the United States, suggest that market forces are likely to restore a more long-term sustainable current account balance here without substantial disruption.8 Indeed, this was the case in the second half of the 1980s. I say this with one major caveat. Protectionism, some signs of which have emerged in recent years, could significantly erode global flexibility and, hence, undermine the global adjustment process. We are already experiencing pressure to slow down the expansion of trade. The current Doha Round of trade negotiations has faced difficulties largely because the low-hanging fruit available through negotiation has already been picked in the trade liberalizations that have occurred since the Kennedy Round. On a more encouraging note, some recent indications of progress may be pointing to a heightened probability of completion of the Doha Round. *** The remarkable technological advances of recent decades have doubtless augmented and fostered the dramatic effect of increased globalization on economic growth. In particular, information and communication technologies have propelled the processing and transmission of data and ideas to a level far beyond our capabilities a decade or two ago. The advent of real-time information systems has enabled managers to organize a workforce without the redundancy required in earlier decades to ensure against the type of human error that technology has now made far less prevalent. Real-time information, by eliminating much human intervention, has markedly reduced scrappage rates on production lines, lead times on purchases, and errors in many forms of recordkeeping. Much data transfer is now electronic and far more accurate than possible in earlier times. The long-term path of technology and growth is difficult to discern. Indeed, innovation, by definition, is not forecastable. In the United States, we have always employed technologies at, or close to, the cutting edge, and we have created many innovative technologies ourselves. The opportunities of many developing economies to borrow innovation is not readily available to us. Thus, even though the longer-term prospects for innovation and respectable U.S. productivity growth are encouraging, our productivity growth has rarely exceeded an average rate of 3 percent annually for any protracted period. *** We have, I believe, a reasonably good understanding of why Americans have been able to reach farther into global markets, incur significant increases in debt, and yet not suffer the disruptions so often observed as a consequence. However, a widely held alternative view of the past decade cannot readily be dismissed. That view holds that the postwar paradigm is still largely in place, and key financial ratios, rather than suggesting an evolving economic structure, reflect extreme values that have materialized within an unchanged structure and must eventually adjust, perhaps abruptly. To be sure, even with the increased flexibility implied in a paradigm of expanding globalization and innovation, the combination of exceptionally low saving rates and historically high ratios of household debt to income can be a concern if incomes unexpectedly fall. Indeed, virtually any debt burden doubtless will become oppressive if incomes fall significantly. But rising debt-to-income ratios can be somewhat misleading as an indicator of stress. Indeed the ratio of household debt to income has been rising sporadically for more than a half-century, a trend that partly reflects the increased capacity of ever-wealthier households to service debt. Moreover, a significant part of the recent rise in the debt-to-income ratio reflects the remarkable gain in homeownership. Over the past decade, for example, the share of households that own homes has risen from 64 percent to 69 percent. During the decade, a significant number of renters bought homes, thus increasing the asset side of their balance sheets as well as increasing their debt. It can scarcely be argued that the substitutions of debt service for rent materially impaired the financial state of the new homeowner. Yet the process over the past decade added more than 10 percent to outstanding mortgage debt and accounted for more than one-seventh of the increase in total household debt over that period.9 Thus, short of a period of appreciable overall economic weakness, households, with the exception of some highly leveraged subprime borrowers, do not appear to be faced with significant financial strain. With interest rates low, debt service costs for households have been essentially stable for the past few years. Accounting for other fixed charges such as rent, utilities, and auto-leasing costs does not materially alter this assessment of stability. Even should interest rates rise materially further, the effect on household expenses will be stretched out because four-fifths of debt is at fixed rates and varying maturities, and it will take time for debt to mature and reflect the higher rates. Despite the almost 2-percentage-point rise in mortgage rates on new originations from mid-1999 to mid-2000, the average interest rate on outstanding mortgage debt rose only slightly, as did debt service. In a related concern, a number of analysts have conjectured that the extended period of low interest rates is spawning a bubble in housing prices in the United States that will, at some point, implode. Their concern is that, if this were to occur, highly leveraged homeowners would be forced to sharply curtail their spending. To be sure, indexes of house prices based on repeat sales of existing homes have significantly outstripped increases in rents, suggesting at least the possibility of price misalignment in some housing markets. But a destabilizing contraction in nationwide house prices does not seem the most probable outcome. To be sure, the recent marked increase in the investor share of home purchases suggests rising speculation in homes. (Owner occupants are rarely home speculators because to sell, they must move.)10 However, nominal house prices in the aggregate have rarely fallen and certainly not by very much. And even should more-than-average price weakness occur, the increase in home equity as a consequence of the recent sharp rise in prices should buffer the vast majority of homeowners. House prices, however, like those of many other assets, are difficult to predict, and movements in those prices can be of macroeconomic significance. There appears, at the moment, to be little concern about corporate financial imbalances. Debt-to-equity ratios are well within historical ranges, and the recent prolonged period of low long-term interest rates has enabled corporations to refinance liabilities and stretch out bond maturities. *** The resolution of our current account deficit and household debt burdens does not strike me as overly worrisome, but that is certainly not the case for our fiscal deficit, which, according to the Congressional Budget Office, will rise significantly as the baby boomers start to retire in 2008. Our fiscal prospects are, in my judgment, a significant obstacle to long-term stability because the budget deficit is not readily subject to correction by market forces that stabilize other imbalances. One issue that concerns most analysts, especially in the context of a widening structural federal deficit, is inadequate national saving. Fortunately, our meager domestic savings, and those attracted from abroad, are being very effectively invested in domestic capital assets. The efficiency of our capital stock thus has been an important offset to what, by any standard, has been an exceptionally low domestic saving rate in the United States. Although saving is a necessary condition for financing the capital investment required to engender productivity, it is not a sufficient condition. The very high saving rates of the Soviet Union, of China, and of India in earlier decades often did not foster significant productivity growth in those countries. Saving squandered in financing inefficient technologies does not advance living standards. In light of the uncertain link between saving and productivity growth, it is difficult to measure the exact extent to which our relatively low gross national saving rate will limit the future growth of an efficient capital stock. What we know for sure, however, is that the 30 million baby boomers who will reach 65 years of age over the next quarter-century are going to place enormous pressures on the ability of our economy to supply the real benefits promised to retirees under current law, and our success in attracting savings from abroad may be masking the full effect on investment of deficient domestic saving. *** Our day-by-day experiences with the effectiveness of flexible markets as they adjust to, and correct, imbalances can readily lead us to the mistaken conclusion that once markets are purged of rigidities, macroeconomic disturbances will become a historical relic. However, the penchant of humans for quirky, often irrational behavior gets in the way of this conclusion. A discontinuity in valuation judgments, often the cause or consequence of the building and bursting of a bubble, can occasionally destabilize even the most liquid and flexible of markets. I do not have much to add on this issue except to reiterate our need to better understand it. *** The last three decades have witnessed a significant coalescing of economic policy philosophies. Central planning has been judged as ineffective and is now generally avoided. Market flexibility has become the focus, albeit often hesitant focus, of reform in most countries. All policymakers are struggling to understand global and technological changes that appear to have profoundly altered world economic developments. For most economic participants, these changes appear to have had positive effects on their economic well-being. But a significant minority, trapped on the adverse side of the market's process of creative destruction, are suffering. This is an issue that needs to be more fully addressed if globalization is to sustain the public support it requires to make further progress.

Subject: Footnotes to Speech
From: Emma
To: Emma
Date Posted: Fri, Mar 11, 2005 at 06:07:42 (EST)
Email Address: Not Provided

Message:
http://www.federalreserve.gov/boarddocs/speeches/2005/20050310/default.htm Footnotes 1. Much of what is assembled in final salable form in the United States, for example, may consist of components from many continents. Companies seek out the lowest costs of inputs to effectively compete for their customers' dollars. This international competition, left unfettered, history suggests, would tend to direct output to the comparatively most efficient producers of specific products or services and, hence, maximize standards of living of all participants in trade. Given the skills and education of its workforce and a number of institutional factors, such as its legal structure, each economy will achieve its maximum possible average living standard. Return to text 2. Indeed, the Group of Seven leaders, at their 1977 economic summit, identified inflation as a cause of unemployment. Return to text 3. This had not always been the case. For example, wage and price controls were imposed in the United States in 1971 as a substitute for a tighter monetary policy and higher interest rates to address rising inflation. Return to text 4. The correlation coefficient between paired domestic saving and domestic investment, a conventional measure of the propensity to invest at home for OECD countries constituting four-fifths of world GDP, fell from 0.97 in 1990 to less than 0.8 in 2003. This correlation coefficient has been even lower recently when the United States is excluded from the sample. With rare exceptions, a decline in the correlation of countries' paired domestic saving and domestic investment implies an increased dispersion of current account balances. Return to text 5. It is true that estimates of the ratios of the current account to GDP for many countries in the nineteenth century are estimated to have been as large as, or larger, than we have experienced in recent years. However, the substantial net flows of capital financing for those earlier deficits were likely motivated in large part by specific major development projects (for example, railroads) bearing high expected rates of return. By contrast, diversification appears to be a more salient motivation for today's large net capital flows. Moreover, gross capital flows are believed to be considerably greater relative to GDP in recent years than in the nineteenth century. (See Alan M. Taylor (2002), 'A Century of Current Account Dynamics,' Journal of International Money and Finance, vol. 21 (November), pp. 725-48, and Maurice Obstfeld and Alan M. Taylor (2002),'Globalization and Capital Markets,' NBER Working Paper 8846 (March).) Return to text 6. Based on data provided by the Bank for International Settlements for cross-border bank liabilities and international bonds outstanding. Return to text 7. Although increased flexibility apparently promotes resolution of current account imbalances without significant disruption, it may also allow larger deficits to emerge before markets are required to address them. Moreover, the apparent ability of the U.S. economy to withstand the stock market plunge of 2000, the terrorist attacks of September 11, 2001, corporate governance scandals, and wars in Afghanistan and Iraq indicates a greater degree of economic flexibility than was apparent in the 1970s and earlier. Return to text 8. Caroline Freund (2000), 'Current Account Adjustment in Industrialized Countries,' Board of Governors of the Federal Reserve System, International Finance Discussion Paper 692 (December); Hilary Croke, Steven B. Kamin, and Sylvain Leduc (2005), 'Financial Market Developments and Economic Activity during Current Account Adjustments in Industrial Economies,' Board of Governors of the Federal Reserve System, International Finance Discussion Paper 827 (February). Return to text 9. For statistical methodology see Karen Dynan, Kathleen Johnson, and Karen Pence (2003),'Recent Changes to a Measure of U.S. Household Debt Service,' Federal Reserve Bulletin, vol. 89 (October), pp. 417-26. Return to text 10. A new survey by the National Association of Realtors reports that purchases of vacation homes and homes for investment amounted to more than a third of total existing home purchases last year. Mortgage originations data reported under the Home Mortgage Disclosure Act (HMDA) indicate that the share has been rising significantly since 1998. Return to text

Subject: Listen to Pete - he sees it coming.
From: johnny5
To: All
Date Posted: Fri, Mar 11, 2005 at 05:48:57 (EST)
Email Address: johnny5@yahoo.com

Message:
For those of you that think you are just going to walk away from that interest only or minimum payment loan: http://www.siliconinvestor.com/readmsg.aspx?msgid=21124302 Here's the deal. Let's say you buy a home and the market tanks. Your home is now worth less than the mortgage. If you have not refinanced, this is a purchase money loan, so you can just give the home back to the bank. Once you refinance the bank can go after you for the deficiency. This is California law a Trust Deed state, but most states are the similar. In 1990 very few lenders sought deficiency judgments because the ex-homeowner would just file for bankruptcy leaving the bank little to show for their effort. They made exceptions when they knew they borrower had enough assets. One friend was a partner in a law firm in Houston that folded in 1990 so he moved to Los Angeles with a new law firm. When his Houston home sold for $116K less than the mortgage, the bank sought the difference - which they got because he had it. This being Texas, a mortgage state, the deficiency judgment could be filed even though he had never refinanced. Under the new bankruptcy law there is additional incentive for the bank to file a deficiency judgment. The bank is not limited just to the assets of the ex-homeowner - which when you lose a home is usually close to nil. The bank will now be able to seek recovery of the deficiency judgment from the future earnings of the bankrupt ex-homeowner if they earn more than the median income in their state, or something like that.

Subject: The limits of globalism
From: johnny5
To: All
Date Posted: Thurs, Mar 10, 2005 at 23:43:12 (EST)
Email Address: johnny5@yahoo.com

Message:
This is from the same issue where krugman's declining american growth article was published: http://www.aeaweb.org/jep/contents/Winter2000.html#AN0514060 How Far Will International Economic Integration Go? Dani Rodrik This article speculates about the future of the world economy 100 years from now. It argues that the spread of markets is restricted by the reach of jurisdictional boundaries, and that national sovereignty imposes serious constraints on international economic integration. The political trilemma of the world economy is that international economic integration, the nation-state, and mass politics cannot co-exist. We have to pick two out of three. The article predicts that it will be the nation-state system that disappears HAHA! It won't appear while bush is out espousing Nationalism and 'patriot' acts and fighting a war of 'tyranny' that gives america supreme acces to oil at the cost of the starving billions everywhere else. Kerry tried to bring americans to the 'GLOBAL' test - but America gave its perception of that crap - they voted in the cowboy. Sadly many americans are too silly to realize for the world to get better and trade to flow and make good cross borders instead of guns - america as they know it must die - I live in a park with a lot of canadians - but if they fly that candian flag - oh my god - the american retirees go ballistic! When I tell them I lived in germany 4 years - oh my god - I am a nazi! Even though my dad is half mexican. http://ksghome.harvard.edu/~drodrik/papers.html More international globalism papers by this dani rodrik. I am not an Athenian or a Greek, I am a citizen of the world. ~Socrates Why is it taking so long for this idea to sink in - we have had thousands of years of exposure.

Subject: One armed economists - BWAHAH!
From: johnny5
To: johnny5
Date Posted: Fri, Mar 11, 2005 at 00:21:39 (EST)
Email Address: johnny5@yahoo.com

Message:
Bush knows we must change social security - what was it Kerry said - you can be certain and be WRONG! From the daily reckoning: 'It has been my experience that the folks that know the least about a subject are those that are the most positive and forceful in their opinions. They are so ignorant that they literally do not know that they do not know. The people that truly know 'all about' a subject can also be quite forceful. For most complex situations, no one CAN know 'all about' a subject, but knowledgeable people can see many possibilities and ramifications and tend to hedge their opinions with 'it depends,' or 'on the other hand.' (One of the more famous sayings of Harry Truman was, 'Go out and get me a one-armed economist.') It is an ironic paradox that those that know the least are the more forceful in presenting their views, while those that know the most are the most equivocal. A consequence of this paradox is the knowledgeable person's views are often discarded in favor of the more forceful presentation by the ignoramus. 'As an example, consider the present economy or present war or any large, complex phenomenon. It is my considered opinion that NO ONE 'knows' about 'the war' or 'the economy.' No one is a knowledgeable person to the point of 'certainty.' There are many opinions and many aspects of each one. As such, a person that knows 'a lot' about the subject can be quite hesitant about expressing a firm opinion, and may appear very indecisive and uncertain. A person who knows little about the subject can be quite vehement and forceful in his opinion - he is 'certain.' In a 'contest' for 'acceptance,' it is probable, perhaps likely, that the view of the person who knows little will prevail. When laymen say, 'This ain't rocket science' about a complex topic, it usually means they do not comprehend enough of the subject matter to ascertain the level of complexity involved. Many times, they are too stupid to know they are ignorant. 'There are those that know what they are doing and know they know what they are doing. They are leaders; follow them. 'There are those that know what they are doing and don't know they know what they are doing. They are fools; ignore them. 'There are those that don't know what they are doing and know they don't know what they are doing. They are students; teach them. 'There are those that don't know what they are doing and don't know they don't know what they are doing. They are dangerous; avoid them.' We couldn't have said it better ourselves...

Subject: Alan Greenspan
From: Terri
To: All
Date Posted: Thurs, Mar 10, 2005 at 20:38:48 (EST)
Email Address: Not Provided

Message:
http://www.federalreserve.gov/boarddocs/speeches/2005/20050310/default.htm This is an extremely important speech by Alan Greenspan, delivered this evening at the Council of Foreign Relations. The Chairman indicates that for the time being the very process of globalization has cushioned the developed world from significant economic shocks. We may expect this cushioning to last for a year or so longer, as the process of globalization continues. When the process begins to wane, the cushioning may wane as well, but we can not know this now. I am most impressed by the speech.

Subject: Adaptability
From: Terri
To: Terri
Date Posted: Thurs, Mar 10, 2005 at 20:56:47 (EST)
Email Address: Not Provided

Message:
Alan Greenspan has argued for a while that the American economy has become far more resilient and adaptable in the last 25 years. Imbalances and shocks have far less lasting effect than would have been expected in the past. I quite agree. There have been intelligent bears waiting for a secular bear economy and markets for 25 years, but they have been decidedly wrong however logical the arguments might have seemed. We are in a period of globalization that is adding to the adaptability of the economy, and for a while I find no reason to expect a negative secular change.

Subject: Rain on the parade?
From: johnny5
To: Terri
Date Posted: Thurs, Mar 10, 2005 at 22:23:35 (EST)
Email Address: johnny5@yahoo.com

Message:
Good thoughts Terri. Speed of adaptabilty is important. Rubin and Peterson looked at greenspan on cspan last night and said ADAPTABILITY is a HUGE problem. Our politicos have made congress such a logjam that congress cannot efficiently adapt and bring change to our laws and policies in time to react. Therefore peterson predicts we will do it the 'hard' way and collapse. They kept bringing greenspans on words against him - of which they chided him are very few: http://www.mises.org/fullstory.aspx?Id=1382 Warned Alan Greenspan, 'Some clouds of emerging protectionism have become increasingly visible on today's horizon.' Mr. Evans comments, it must be remembered, came within two weeks of the WTO’s ruling against Bush’s steel tariffs. He continues: 'Several proposals in Congress reflect the tension in our trade relations with China. One measure would repeal Permanent Normal Trade Relations with China while another would impose a 27.5% tariff on all Chinese exports to the U.S. The Bush administration opposes these proposals, but they should serve as ample warning to the Chinese government that progress—not promises—is required.' China’s only crime is selling goods too cheaply. During the early to mid-1990s, some politicians, journalists and intellectuals began to create the 'China Threat' in the minds of the public. The threat, as of then, was more or less confined to matters of military security. Reports of China’s purchase of military secrets from the U.S. only heightened Sino-U.S. tensions. As it became obvious to most casual observers that these allegations were largely untenable, the 'China-as-economic-threat' was born. Recent headlines detailing the slow, painful and quite noisy death of the manufacturing sector have added gas to the Sinophobia now infecting much of Washington. Perennial economic pessimist Pat Buchanan summarizes the new economic threat from China: 'Hamilton, Clay, Lincoln, and T.R. would recognize China’s policy for what it is and counter it. But this generation of free traders does not have a clue as to what is going on, or does not care. Either way, the consequences will be the same: de-industrialization of America, decline of the dollar, a deepening dependency on foreign countries for the necessities of our national life, diminished sovereignty, and eventual loss of our independence.' The shift from military to economic bellicosity on behalf of the U.S. government is positive in only one sense. Bastiat once wrote that guns cross boarders when goods don’t. In the case of China and the U.S., the now commercial interdependence between the two countries essentially excludes any possibility of military aggression. As the Washington Post reports, 'more than half of Chinese exports to the United States are produced by factories wholly or jointly owned by American companies, according to the China Council for the Promotion of International Trade, a government-affiliated group.' As the example of Cuba and North Korea show, belligerency and militaristic posturing move inversely with the level of capitalist integration. The United States is able to threaten Cuba and North Korea precisely because it can do so at little financial loss. A war with China is now unthinkable due to the destruction it would bring not only to the U.S. and China, but to the world in general. In short, commerce facilitates peace. Viewed in this light, the threats of protectionist action against China are more than mere blusterings in the halls of Congress. The opinion of some that our greatest trading partner also represents the gravest of military and economic threats is as ludicrous as it is dangerous. The Sinophobia now infecting the Beltway and some corporate boardrooms must not be ignored. The peace and prosperity of the world, in large part, depends on our continuing economic ties with China. In short, the fetters of economic nationalism must be broken in the hearts and minds of the American public so that the mistakes of the 20th century are not again repeated.

Subject: Re: Rain on the parade?
From: johnny5
To: johnny5
Date Posted: Thurs, Mar 10, 2005 at 22:33:23 (EST)
Email Address: johnny5@yahoo.com

Message:
Terri many US investors - including pres bush's granddad prescott Bush were big investors in Germany - they were friends of the germans, california was advocating eugenics before the nazi's. Hitler appeared in homes and garden magazine with his nice country chalet in the hills of germany and had many favorable interviews with british reporters. In fact even after the country had declared WAR on germany, special legislation had to be enacted to punish people like Prescott Bush who kept sending investment dollars to Germany while they grew auschwitz on the back of slaves. Why was the world not able to use its economic integration with germany to stop thier war machine?

Subject: You can't eat a house
From: johnny5
To: johnny5
Date Posted: Thurs, Mar 10, 2005 at 23:21:22 (EST)
Email Address: johnny5@yahoo.com

Message:
'But rising debt-to-income ratios can be somewhat misleading as an indicator of stress. Indeed the ratio of household debt to income has been rising sporadically for more than a half-century, a trend that partly reflects the increased capacity of ever-wealthier households to service debt.' They are wealthier because the speculators have driven up housing prices no? ' Moreover, a significant part of the recent rise in the debt-to-income ratio reflects the remarkable gain in homeownership. Over the past decade, for example, the share of households that own homes has risen from 64 percent to 69 percent. ' This home ownership comes with interest only or principal negative loans. The NAR said over 40% of new home ownership is being funded this way with no money down no? http://calculatedrisk.blogspot.com/2005/03/housing-excessive-leverage.html 'During the decade, a significant number of renters bought homes, thus increasing the asset side of their balance sheets as well as increasing their debt. It can scarcely be argued that the substitutions of debt service for rent materially impaired the financial state of the new homeowner.' If you don't pay your debt the interest keeps piling up the amount you owe. 'Thus, short of a period of appreciable overall economic weakness, households, with the exception of some highly leveraged subprime borrowers, do not appear to be faced with significant financial strain. With interest rates low, debt service costs for households have been essentially stable for the past few years. Accounting for other fixed charges such as rent, utilities, and auto-leasing costs does not materially alter this assessment of stability.' Well I hear interest rates are going up, and in my household, the more food and energy and gas costs, the less I can afford to pay to service my ever increasing debt.

Subject: Africa Makes Fine Films
From: Emma
To: All
Date Posted: Thurs, Mar 10, 2005 at 18:55:58 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/10/international/africa/10cinema.html Africa Makes Fine Films. Of Course, Projector May Fail. By LYDIA POLGREEN OUAGADOUGOU, Burkina Faso - With its whorls of dust kicked up by a chaotic rush of mopeds and not a spot of sea in sight, this ancient capital of the Mossi kingdom is no Cannes on the azure Riviera. The pitiless sun that would wilt the enthusiasm of even the most ardent cinephile is a constant reminder that one is far, far away from the mountains of Park City, Utah, the host of the Sundance Film Festival. No matter. The banner outside the tiny national airport says it all: Welcome to the capital of African cinema. As February yields to March in every odd-numbered year, the brightest lights of African movies and television, thousands of their fans and even a Hollywood star or two gather at Fespaco, Africa's premier film festival, held in this threadbare, dusty capital. 'As it says in the Bible, man cannot live on bread alone,' said Baba Hama, the festival's secretary general. 'Cinema is at the heart of African culture, and one cannot choose between food and culture - you need both to live.' Fespaco - the name is the French acronym for the Pan-African Film Festival of Ouagadougou - is in some ways the ultimate African feel-good happening - a complex event with a huge international audience pulled off by an impoverished, landlocked former French colony that ranks at the bottom of nearly every measure of human well-being. For nearly 40 years it has been a biennial reminder that even in places racked by death, famine, war and disease, culture remains as essential as air. At the Independence, the down-at-heel hotel that the festival's auteurs prefer, passionate, beery debates on the future of African cinema raged all week at poolside tables, reflecting not just the usual tensions that filmmakers everywhere face, between art and commerce, between accessibility and artistic expression, but also the essential questions Africa faces today. Just after dusk one evening, as bats circled overhead, a group of filmmakers from French-speaking countries bemoaned the overweening influence of the former colonial power, which has been the main patron of African cinema, denouncing its efforts as neocolonialism. At another table earlier in the day, the sun blazing through the fine mist of dust blowing down from the Sahara, another group of directors and actors debated whether African filmmakers have a duty to be social activists or should be free to make purely artistic films. 'Cinema is the language in which we explore our past and future,' said Jean-Marie Teno, a Cameroonian filmmaker whose most recent documentary, 'The Colonial Misunderstanding,' examines the role German missionaries played in the brutal colonial regime in Namibia. 'It is how we come to understand where we came from and where we are going.' But nearly 40 years after the festival was established, many filmmakers here wondered what exactly Fespaco has achieved. Always hampered by logistical problems, it was particularly troubled this year. The problems began at the opening ceremony, where a huge crowd straining to get into the free event caused a stampede that killed two children and wounded dozens of others. At least a dozen screenings were canceled or postponed because of equipment problems. The sleepiest of West African capitals most of the time, Ouagadougou comes alive for Fespaco. But its infrastructure is clearly strained by the 4,000 arrivals. 'This is a castle built on air,' said Cherif Keita, a Malian director whose documentary about John Dube, the founder of the African National Congress, was to be screened here. A standing-room-only crowd assembled for the screening, including a grandson of Mr. Dube, flown specially to Ouagadougou at the request of South Africa's president, Thabo Mbeki. But the projector did not work. 'Almost 40 years and we are still looking like amateurs,' Mr. Keita said. Indeed, for African cinema, these are the best of times and the worst of times. African films have won big this season at other festivals - an Angolan film called 'The Hero' about an amputee from that country's nearly 40-year civil war won a prize at Sundance. South Africa's booming film industry has also won notice - a reinterpretation of Georges Bizet's musical 'Carmen' done entirely in Xhosa stormed the Berlin film festival, and a Zulu-language film about a woman who is H.I.V.-positive won an Oscar nomination. For the first time a South African film, 'Drum,' won Fespaco's top award, the coveted Gold Stallion of Yennenga. Yet despite all the attention, African films do not reach African audiences. With no real distribution network for African movies, an African cinemagoer is more likely to see Jackie Chan's latest kung fu extravaganza than anything made on the continent. Here in Ouagadougou signs for American blockbusters were hastily plastered over in favor of homegrown films on the festival roster. But as soon as Fespaco ends, people here say, the blockbusters return. 'Getting African films to African audiences is still the big hurdle,' said Zeze Gamboa, director of 'The Hero,' which has yet to be seen in his native Angola. 'There is no means to get it to theaters, and some countries don't even have theaters.' Efforts on several fronts to improve distribution are under way, but it will take time and money. The latter is tough to find in countries that have trouble managing to feed themselves. Which is what makes Fespaco's eight days in Ouagadougou so essential, said Zola Maseko, whose film about a crusading antiapartheid journalist in the 1950's won the top prize here. 'African cinema needs to be for and about Africans,' Mr. Maseko said. 'That's what we are all fighting for.'

Subject: The Bush administration goes soft (Huh?)
From: Pancho Villa
To: All
Date Posted: Thurs, Mar 10, 2005 at 18:30:32 (EST)
Email Address: nma@hotmail.com

Message:
The Bush administration goes soft by Joseph S. Nye The first term of George W. Bush’s presidency was marked by unilateralism and military power. The United States was the world’s only superpower, so others had to follow. The result was a dramatic decline in America’s “soft” or attractive power. Secretary of Defense Donald Rumsfeld said he did not know what soft power was. Now it is back in fashion in Washington. Bush’s second inaugural address was devoted to the power of liberty and democracy. Such rhetoric is not new to American presidents. Harry Truman spoke of defending free people everywhere, and Woodrow Wilson spoke of promoting democracy. The neo-conservatives in Bush’s first administration were in that tradition, but ignored the fact that both Wilson and Truman were also institution-builders who consulted other countries. In dropping that half of Wilson’s approach, they stepped on their own message, reducing its effectiveness. The tone at the beginning of the second Bush administration is different. As Secretary of State Condoleezza Rice said recently in Paris: “I use the word ‘power’ broadly, because even more important than military and indeed economic power is the power of ideas, the power of compassion, and the power of hope.” Bush not only chose to visit Brussels, the capital of the European Union, on his February trip to Europe, but stated that what “we seek to achieve in the world requires that America and Europe remain close partners.” Even Rumsfeld is trying to be conciliatory! Will Bush’s new approach succeed? On a recent trip to Europe, I encountered both encouragement and skepticism. Many people welcomed the new tone, but wondered if it was simply sugarcoated cynicism. Words must be matched by deeds before people are convinced. One place to look to see if deeds are forthcoming is in Bush’s latest budget. The budget cuts discretionary spending (other than defense and homeland security) by nearly 1%, and slashes as many as 150 domestic programs. Yet, in this climate of fiscal stringency, he calls for increased contributions to international organizations, the Millennium Challenge Account to provide assistance to countries with a commitment to making progress in poverty reduction, and the Global HIV/AIDS Initiative. Bush’s new budget also includes an increase in funding for public diplomacy. The allocation for the State Department’s educational and cultural exchange programs, including overseas research centers, libraries, and visitor programs, is boosted by nearly 25%. As Bush’s budget request to Congress puts it, “Rarely has the need for a sustained effort to ensure foreign understanding for our country and society been so clearly evident.” This comes after a first term in which public diplomacy was a neglected stepchild, and a Pentagon advisory panel summed up the situation as a “crisis.” Even with these increases, there is a long way to go to improve America’s standing. A recent non-partisan report by the Public Diplomacy Council called for a new Agency for Public Diplomacy within the State Department, 24-hour English-language broadcasts by the Voice of America, and a fourfold budget increase over the next five years. The Bush administration still has much to do in promoting ideas, but early indications suggest a change from the neglect of the first term. But it will not be enough for Bush to start his second term with grand rhetoric about values and increased investment in public diplomacy. A country’s attractiveness or soft power stems partly from its culture and values (where they are attractive to others), but it also grows out of a country’s policies when they are seen as legitimate, consultative, and inclusive of the interests of others. Unless the policies fit the values, the discrepancy will give rise to charges of hypocrisy. At a minimum, Bush will need to pursue policies – in a more consultative manner – that seek a political solution in Iraq and progress in the Israel-Palestine peace process. Here too, the early signs are encouraging. The 60% turnout in the January elections and the scenes of Iraqis risking their lives to vote has led to hopes that a political settlement in Iraq may be possible. The elections are but a first step; the insurgency continues; civil war remains possible. Nonetheless, the elections may have softened some of the sense of illegitimacy that has clouded Bush’s Iraq policy. Similarly, with regard to the Middle East peace process, the replacement of Yasir Arafat by Mahmoud Abbas, the Palestinian elections, and the meetings between Abbas and Ariel Sharon suggest progress. On difficult nuclear issues, such as North Korea and Iran, Bush has pursued multilateral consultation and coordination with other powers. Of course, this still leaves unresolved other multilateral issues, like the International Criminal Court and global climate change. There is little prospect that Bush will reverse his rejection of the Kyoto Treaty, but it will be interesting to see how far he accommodates Prime Minister Tony Blair’s efforts to make climate change a priority during Britain’s period as chair of the Group of Eight major economies. It is much too early for a verdict on Bush’s second term policies. As he looks ahead to the verdict of history, he seems to realize that hard power alone will not consolidate his reputation, but he remains hostage to incidents and accidents that could drive even his best-laid plans off course. Nonetheless, the most striking thing at this point in Bush’s second term is his belated discovery of the importance of diplomacy and soft power. Joseph S. Nye, a former US Assistant Secretary of Defense, is Distinguished Service Professor at Harvard, and author of Soft Power: The Means to Success in World Politics. http://www.dailystar.com.lb/article.asp?edition_id=10&categ_id=5&article_id=13171

Subject: Servicing the military killed Rome
From: johnny5
To: Pancho Villa
Date Posted: Thurs, Mar 10, 2005 at 22:11:35 (EST)
Email Address: johnny5@yahoo.com

Message:
' recent non-partisan report by the Public Diplomacy Council called for a new Agency for Public Diplomacy within the State Department, 24-hour English-language broadcasts by the Voice of America, and a fourfold budget increase over the next five years. ' No wonders Warren Buffet bought comcast cable - we are going to take over the world by making them couch potatoes who watch a lot of tv - johnny5 has seen many xboxen in iraq keeping the kids occupied driving gran turismo 4 instead of learning how to strip an AK47. Rubin specifically said cutting the military helped to save the economy in the clinton years - him and peterson agreed in this NEW WAR america - the rubin fix is off the table and therefore we can't do anything but continue to destroy our economy worse and worse going deeper into hock for those tanks.

Subject: Political Shell Game
From: johnny5
To: All
Date Posted: Thurs, Mar 10, 2005 at 18:10:51 (EST)
Email Address: johnny5@yahoo.com

Message:
The US government is no longer effective. Politics and crony capitalism have broke our dreams - they can't fix anything - even glaring real problems that everyone agrees on. If we implement the consumption tax as alan greenspan says - it will crush our new housing markets - surely sending us into the abyss. http://www.house.gov/paul/tst/tst2005/tst030705.htm Tax Reform is a Shell Game March 7, 2005 Tax reform is back in the news, brought to the political forefront by a recent meeting of the president’s advisory panel on tax reform. Once again, politicians and former politicians are lamenting the complexity of our tax laws, as though their own spending measures have nothing to do with it. But we’ve heard this song before. In fact, we’ve been promised a simpler, fairer, and better income tax system many times, most recently in 1997 and 1986 when Congress made relatively significant changes to the tax code. Yet the federal tax system remains an embarrassment, both in terms of the tax burden itself and the outrageous compliance costs engendered by its complexity. One tax reform idea tacitly endorsed by Federal Reserve chairman Alan Greenspan calls for a national retail consumption tax to replace the existing income tax. Absent the outright repeal of the 16th Amendment, however, we cannot be sure that an income tax would not reappear at some point. One can easily imagine popular support for retaining the income tax on the “very rich,” which of course is how the 16th amendment originally was sold to a gullible public in the 1910s. The president has thrown cold water on the consumption tax proposal, however, by announcing he opposes any reform that eliminates mortgage and charitable deductions. This leaves us with variations on the flat tax concept, which was savaged by the political left when advocated by the likes of House Majority Leader Dick Armey and Steve Forbes in the 1990s. Lew Rockwell of the Ludwig von Mises Institute offers a very simple test for any tax reform proposal: Does it reduce or eliminate an existing tax? If not, then it amounts to nothing more than a political shell game that pits taxpayers against each other in a lobbying scramble to make sure the other guy pays. True tax reform is as simple as cutting or eliminating taxes. No studies, panels, committees, or hearings are needed. When reform proposals seem complicated, they almost certainly don’t cut taxes. The reform debate is strictly about politics and not serious economics. Both sides use demagoguery but don’t propose truly significant tax reductions. Both sides use the outrageous expression “cost to government” when talking about the impact of tax legislation on revenues. This implies that government owns everything, and that any tax rate less than 100% costs government some of its rightful bounty. Government spending is the problem! When the federal government takes $2.5 trillion dollars out of the legitimate private economy in a single year, whether through taxes or borrowing, spending clearly is out of control. Deficit spending creates a de facto tax hike, because deficits can be repaid only by future tax increases. By this measure Congress and the president have raised taxes dramatically over the past few years, despite the tax-cutting rhetoric. The real issue is total spending by government, not tax reform. Who wants a 40% flat tax? Who wants a national sales tax if it adds 35% to the retail price of everything we buy? In other words, why change the tax structure if spending stays the same? Once we accept that Congress needs $2.5 trillion from us-- and more each year-- the only question left is from whom it will be collected. Until the federal government is held to its proper constitutionally limited functions, tax reform will remain a mirage.

Subject: Capsize point
From: Pete Weis
To: All
Date Posted: Thurs, Mar 10, 2005 at 15:25:40 (EST)
Email Address: Not Provided

Message:
A sailboat possesses a resistance to capsizing. The ballast located in its keel is part of a moment arm which resists capsizing forces due to the wind in the sails or large, steep waves which might hit the boat broadside. As the boat rotates over on its side the moment arm opposing the capsizing force increases steadily (due to the increasing horizontal distance between the center of gravity and the boats center of buoyancy), reaching a maximum at 90 degrees to vertical. Once the sailboat goes past the 90 degree point, resistance to capsizing falls off very rapidly as this horizontal distance decreases and eventually goes in the opposite direction - contributing to the capsize. You might think of the dollar as a sailboat whose resisitance to capsizing involves the general belief that since it has never capsized (similar to some Latin American currencies) that it won't in the future. But as that belief lessens there must be a real tipping point out there somewhere where capsize resistance goes to zero and beyond. Will we reach it? It depends on how much force is applied. Weak Dollar Getting Pummeled Thu Mar 10, 2005 11:26 AM ET By Jamie McGeever NEW YORK (Reuters) - The dollar weakened on Thursday against most currencies on concerns over global central bank reserve diversification, a widening U.S. trade deficit and tumbling bond prices. 'We're just in a general dollar downtrend right now,' said Sophia Drossos, currency strategist at Morgan Stanley in New York. Having slumped to multi-month lows against its major counterparts on Wednesday, the dollar suffered another blow on Thursday after Japanese Prime Minister Junichiro Koizumi told parliament that, generally speaking, diversity in foreign exchange reserves was a good thing. The Ministry of Finance, which manages the world's largest foreign reserve holding of $840.6 billion, quickly clarified that it has no plans to shift funds out of the dollars. But the specter of diversification was raised again, putting pressure on the dollar again, much like had happened after South Korea's central bank mentioned the subject in a report last month. 'Although MoF quickly suggested that they had no plans to change now, the suspicion lingers that more Asian central bank diversifiers are to appear,' wrote Goldman Sachs analysts in a research note on Thursday. Early morning in New York, the euro was up at $1.3414 and sterling was a touch stronger at $1.9253 . The dollar was down 0.4 percent at 1.1542 Swiss francs and largely flat at 103.98 yen . The yen came under some selling pressure after weak Japanese core machinery orders. The euro rose to 140.00 yen earlier in the session for the first time this year. Sterling managed to take the Bank of England's decision to kept interest rates unchanged at 4.75 percent largely in its stride. 'The 'diversification' word really spooked the market ... but the bond market selloff is weighing on the dollar big time,' said Samarjit Shankar, director of global strategy at Mellon Bank in Boston. 'The bond market is really adding that extra piece of weight on the dollar right now.' The price of U.S. Treasuries have fallen steeply this week, pushing the yield on the 10-year note up to 4.57 percent (US10YT=RR: Quote, Profile, Research) , its highest level since July last year. They're now down at around 4.487 percent on Thursday, but have convincingly broken up through key technical levels that were intact for several months. TRADE DATA IN FOCUS The rise in bond yields is sometimes seen as a supportive factor for a currency, as it offers investors a higher rate of return relative to other fixed income markets. But not in this instance. Dross at Morgan Stanley suggests the market is worried about incipient inflation pressures, and although the Federal Reserve will certainly act to keep them from building, it might not act quick enough. 'It's not a scare, but it's a concern. Inflation is never good for a currency,' she said. The massive U.S. current account deficit hasn't been particularly good for the dollar either in recent years, and a reminder of this may come on Friday morning when the Commerce Department releases January's data. The figures are expected to show a deficit of $56.5 billion, slightly wider than the previous month and what would be the second widest on record. Data released on Thursday from two of the U.S.'s biggest trading partners suggest its deficit won't be narrowing significantly any time soon. Germany, the euro zone's largest economy, appears to be coping with a strong currency, as it posted a trade surplus of 12.9 billion euros in January on record exports. And China posted a surplus of $11 billion in the first two months of the year. Meanwhile, U.S. weekly jobless claims, which rose an unexpectedly high 17,00 last week, kept the dollar under pressure too, analysts said. Economists had expected no change on the week.

Subject: Like Munger said
From: johnny5
To: Pete Weis
Date Posted: Thurs, Mar 10, 2005 at 17:31:26 (EST)
Email Address: johnny5@yahoo.com

Message:
Quit trying to quantize and analyze and fill your head with all this other info - I put it straight to you - If warren buffet and bill gates are short the dollar - what person in thier right mind thinks they are going to outperform these 2 men? Why make it any more complicated than that - Warren says go short - he put his money where his mouth was - what are people's problem with taking the sages advice? Do you feel warren is a fool and the vanguard index fund will outperform warren? Do you feel warren is a liar and trying to get you to short the USA because we are still number 1? Why is this so hard for people to believe? Empires collapse - stock markets and housing collapse - warren says go short - who is the first one here that thinks they know more than warren? I don't.

Subject: Hey, I just like sailboats...
From: Pete Weis
To: johnny5
Date Posted: Thurs, Mar 10, 2005 at 19:13:00 (EST)
Email Address: Not Provided

Message:
and saw an analogy. Probably got a little carried away. I just wondered what the Fed might do if we reached a point where the dollar really started to tank in a panic selloff.

Subject: Sailing takes me away to where I want to be
From: johnny5
To: Pete Weis
Date Posted: Thurs, Mar 10, 2005 at 22:02:50 (EST)
Email Address: johnny5@yahoo.com

Message:
Johnny5 has often wondered too, he knows the fed is SUPPOSED to try and bring stability to the world along with other central bankers - but johnny5 sees lots more private investors controlling the markets and economies than these central banks - 5 trillion verus 15 trillion right? Also the fed is really a private bank with shareholders no - how long can those shareholders lose money and the fed go negative before it collapses like most any other company would that consistently loses money year after year? Of course we can keep printing and do a huge hyperinflation - do you think that is the logical outcome if the 15 trillion dollars worth of private investors go into panic mode and start rushing for the exits? The canvas can do miracles, just you wait and see! Chris Cross

Subject: Prepay penalty - was that in fine print
From: johnny5
To: All
Date Posted: Thurs, Mar 10, 2005 at 12:50:41 (EST)
Email Address: johnny5@yahoo.com

Message:
The Prepayment Trap: Lenders Put Penalties On Popular Mortgages By RUTH SIMON Staff Reporter of THE WALL STREET JOURNAL March 10, 2005; Page D1 Many homeowners who are rushing to refinance as interest rates rise may find themselves facing some unexpected terms: Their lenders have set a trap for them if they decide to pay the loan off early. Prepayment penalties -- requiring borrowers who close out a loan in the first few years to fork over some extra cash -- have long been common on the so-called subprime mortgages issued to borrowers with blemished credit records. But they are increasingly showing up on adjustable-rate mortgages, or ARMs. The penalties, which usually kick in on loans that are repaid within one to three years, are especially common on popular 'option ARMs,' which carry low introductory rates. Between 40% and 70% of option ARMs now carry prepayment penalties, depending on the lender, according to Gyan Sinha, a senior managing director at Bear Stearns Cos. David Soleymani, a mortgage broker in Los Angeles, estimates that 'half the lenders in the country' now offer loan options with prepayment clauses. At the same time, more lenders are adding 'early-termination fees' to home-equity loans and lines of credit that can mean higher costs if the loan is closed too soon. Lenders say they offer prepayment clauses on mortgages as an option to borrowers seeking a better deal. In exchange, homeowners may pay fewer points or reduce their rate by one-eighth to one-quarter of a percentage point. Borrowers can typically pay off as much as 20% of the loan balance without triggering the penalty. But prepayment penalties can sting, particularly when mortgage rates are moving up or down at a rapid clip. During the refinancing boom, prepayment clauses made it difficult for some borrowers to refinance and take advantage of lower rates. Now that rates are moving upward, prepayment penalties can mean higher costs for borrowers who want to pull out extra cash or refinance to protect against future rate increases. State laws can affect just how much of a penalty is charged; some states, such as New Jersey and Pennsylvania, prohibit them, according to the Center for Responsible Lending, though not all lenders are subject to these rules. At World Savings, a unit of Golden West Financial Corp., borrowers who take out a mortgage with a prepayment clause typically must pay 2% of the outstanding loan balance if they pay off the loan in the first three years. Countrywide Financial Corp. offers loans with one- and three-year prepayment penalties -- typically six months' interest on 80% of the amount paid off. At Washington Mutual Inc., borrowers who elect an option ARM are required to accept a one-year prepayment penalty if they pay less than 0.5% in points. They can also choose a three-year penalty in exchange for a lower rate. Hybrid ARMs that carry a fixed rate for the first year typically have a three-year prepayment penalty unless the borrower pays at least 1% in points. (These arrangements apply to loans originated through the company's retail stores.) Prepayment penalties are attractive to lenders and investors who buy pools of mortgages because they reduce the chance that the borrower will quickly refinance -- and provide a payoff if the borrower does. In addition, mortgage brokers can often earn more if they put a customer in a loan with a prepayment penalty. 'On a big loan, it can be as much as $10,000,' says Mitchell Ohlbaum, president of Legend Mortgage Corp., a mortgage broker in Los Angeles. At some banks, loan officers can also earn extra for putting borrowers into loans with these features. Some borrowers don't even realize their mortgage has a prepayment clause. Christopher Clyne, a cardiologist in West Hartford, Conn., was surprised to find he was facing a prepayment penalty of about $15,000 when he went to refinance his $750,000 option ARM in late December. 'We found out at the 11th hour,' recalls Dr. Clyne. 'It nearly scuttled the deal.' He says his mortgage banker, Michael Menatian, convinced the lender to hold the rate on the new loan for a couple of weeks until the penalty expired. Other borrowers decide refinancing is worth the cost of the penalty. Roger Behrstock, the owner of Pride Flight Associates, a jet aviation charter company in Beverly Hills, Calif., was hit with a $8,900 prepayment penalty when he decided to refinance his $890,000 short-term ARM last year. Mr. Behrstock went ahead with the new loan anyway, because he needed extra cash for his company. The new mortgage also lowered his payments by $1,800 a month. Some lenders are stricter than others. Countrywide Financial charges a prepayment penalty if the borrower sells or refinances the property. At World Savings, prepayment penalties are waived only if the borrower refinances with World Savings or sells the home and buys another home using a World Savings mortgage. GMAC Mortgage, a unit of General Motors Corp., typically waives the penalty on its option ARM if the home is sold. Borrowers with home-equity loans can also find themselves hit with extra costs if they close their loan too soon. Some 41% of lenders now offer home-equity loans with early-termination clauses, up from 24% in 2001, according to a survey done by Benchmark Consulting International. More than 60% of home-equity lines now carry an early-termination fee, according to HSH Associates, though borrowers can pay down the line without penalty. CitiMortgage, a unit of Citigroup Inc., charges borrowers closing costs if they pay off a home-equity loan or line of credit within the first three years. At U.S. Bancorp, borrowers who close their loan or line within the first three years must pay 1% of the loan balance, with a minimum charge of $100 and a maximum fee of $350. Wells Fargo & Co. levies a $500 fee if a borrower closes the loan or line within the first three years, unless the borrower is refinancing through the bank. One reason these clauses have become more popular: More lenders are offering home-equity products with little or no upfront costs -- and lenders say they need some way to recoup their expenses if the loan drops off the books too soon. Compass Bancshares Inc. added an early-termination fee to its home-equity offerings when it revamped them two years ago. 'Home equity is really the hot business right now,' says Chris Ward, director of equity lending. 'To be competitive, we knew we had to offer a 'no-closing-costs' option to consumers.' Borrowers pay third-party closing costs -- typically $300 to $1,000 -- if a home-equity line is closed or a home-equity loan is paid off within the first two years. The fee is waived for borrowers who sell their house. At least one lender, though, has moved in the opposite direction. Bank of America Corp. last year began eliminating early-termination fees on its home-equity lines and loans. The fees were dropped as part of the lender's drive to simplify its offerings, a spokeswoman says.

Subject: Re: Prepay penalty - was that in fine print
From: Setanta
To: johnny5
Date Posted: Fri, Mar 11, 2005 at 04:30:57 (EST)
Email Address: Not Provided

Message:
interesting. when i was shopping around for a mortgage a few months ago i was informed that over here there are no penalties for early repayment in variable rate mortgages (i presume would be similar to your ARM's) and that penalties only apply to early payment of fixed rate mortgages.

Subject: Re: Prepay penalty - was that in fine print
From: Jennifer
To: Setanta
Date Posted: Fri, Mar 11, 2005 at 10:20:59 (EST)
Email Address: Not Provided

Message:
Are all European mortgages of variable or adjusted rates? Many American mortgages evidently have prepayment penalties lasting for different lengths of time.

Subject: America is number 1 er 2 um 3 no 4 uh 5?
From: johnny5
To: All
Date Posted: Thurs, Mar 10, 2005 at 12:41:13 (EST)
Email Address: johnny5@yahoo.com

Message:
Singapore surpasses US as top tech nation http://www.forbes.com/home/technology/2005/03/09/cx_0309wef.html Singapore has displaced the United States as the top economy in information technology competitiveness, according to the World Economic Forum's latest annual Global Information Technology Report released today. The U.S. drops from first to fifth in the rankings, which measures the propensity for countries to exploit the opportunities offered by information and communications technology (ICT). Jobs in jeopardy, NASA/Ames offers buyouts By Jessica Portner Posted on Wed, Mar. 09, 2005 Mercury News NASA/Ames is set to offer buyouts this week to all but 70 of its 1,400 federal employees as part of one of the most dramatic makeovers the research center has undergone in two decades. With a push from the Bush administration to streamline operations, scientists and engineers -- from aeronautics experts to computer whizzes -- will be offered a buyout package with a federally mandated cap of $25,000, Ames officials and union leaders confirmed Tuesday. Ames officials say they don't know how many employees will accept the offer to cut short their careers at the premier research facility at Mountain View's Moffett Field, where engineers developed Mars Rover technology and one of the fastest supercomputers in the world. But the buyout is aimed at cushioning the blow for many workers if the center is forced to lose as many as 700 jobs at risk under President Bush's proposed federal budget. ``Now is the time to take advantage of the buyout,'' said Michael Marlaire, the director of external relations of Ames Research Center. ``We don't have a goal, and we want to see how many want to go.'' About 30 workers recently left under buyout agreements, a union official representing Ames workers said. Ames' federal jobs aren't the only ones in jeopardy. Many of the center's estimated 1,400 contractors also are being forced out, according to Chris Knight, one of the lead negotiators for Ames Federal Employees Union, although he couldn't specify how many jobs. The anticipated buyout offer comes after President Bush's proposed federal budget puts nearly one-third of Ames' $700 million in annual funding at risk. Marlaire said Ames could lose as many as a quarter of its civil servant and contracting jobs by the end of 2006 if it fails to successfully compete with private companies and other National Aeronautics and Space Administration research centers for money it has been accustomed to receiving automatically. Ames is trying to retain certain workers, such as those who research heat shield technology that protects space shuttles, and air traffic managers that help the Federal Aviation Administration improve technology at airports. NASA/Ames leaders said they also plan to preserve many of the staffers operating the Columbia supercomputer, a joint project with Silicon Graphics and one of the fastest supercomputers in the world. Ames union leaders are negotiating details of the buyout, including which positions should be exempt, and say cuts imperil the center's scientific mission. Employees who accept the deal would leave next month, Knight said. Knight said some veteran scientists nearing retirement might leap at the chance to earn some money -- even at a federally mandated cap of $25,000 -- before they start earning their pensions. But he said many younger workers are devastated at the thought of giving up the dream of working on aeronautics or complex databases. ``People are really worried about what might happen to them next,'' said Knight, referring to possible layoffs down the road. ``There is even a little bit of paranoia. People are hunkering down and trying to lay low.'' Stuart Rogers, a 43-year-old aerospace engineer who worked on the supercomputer, said he would not take the buyout because the money isn't much of an incentive to leave. ``My plan is to try to complete my career at NASA,'' said Rogers, who has worked there for 16 years. ``Reorganization takes scary turns, but it doesn't mean things are going to be bad,'' he said. ``It has definitely affected morale. But I'm so busy, I don't have time to worry about it.'' http://www.mercurynews.com/mld/mercurynews/news/11088394.htm

Subject: Five Years After Nasdaq Hit Its Peak
From: Emma
To: All
Date Posted: Thurs, Mar 10, 2005 at 10:37:38 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/10/business/10scene.html Five Years After Nasdaq Hit Its Peak, Some Lessons Learned By HAL R. VARIAN ON March 10, 2000, five years ago today, the Nasdaq composite index hit its high, 5,132.52, at the peak of the dot-com bubble. It is fitting to commemorate this anniversary with a column about what financial economists have learned from this episode. Perhaps the most fundamental question one can ask about the bubble is how it could have happened in the first place. How could stock prices be pushed up to such irrational and unsustainable levels? Few economists would deny that fools and gamblers participate in the stock market. But the participation of such irrational traders does not necessarily imply that stock prices themselves should be irrational. In principle, irrational exuberance should be self-correcting. If overly optimistic investors bid up the price of a stock, rational investors should step in and sell shares, moving the price back down to a realistic level. This adjustment process does not even require that sellers own shares of the overpriced stock. Someone who thinks that the price of a stock will fall but does not own any shares can borrow shares to sell, a practice known as selling short. If an investor sells short and the stock price does indeed fall, he can buy shares to pay back the loan and pocket the difference as profit. As with other sorts of borrowing, the borrower typically has to pay interest on the loan. But, in the case of the Internet boom, short selling was apparently not strong enough to damp the stock price increases during the Internet bubble. The question is, Why not? Owen A. Lamont, a professor of finance at the Yale School of Management, reviews some recent work in the economics of short selling in the latest issue of the NBER Reporter (available at www.nber.org). As he points out, there were striking examples of apparent overpricing of stocks in 2000. For example, in March of that year, 3Com sold a fraction of its holding of Palm; it announced that by the end of the year it would disburse the rest of its holdings by giving 3Com shareholders 1.5 shares of Palm for each share of 3Com they owned. One would expect that 3Com shares would be worth at least 1.5 times the value of Palm shares. But on the first day of trading after the announcement, Palm shares were worth $95.06 a share while 3Com shares fell to $81.81. The market was valuing the non-Palm part of 3Com's business at minus $63. This pricing anomaly was widely reported in the financial press. The most likely explanation was that day traders and other overly optimistic investors bid up the price of Palm stock to excessive levels. These traders were presumably unaware that they could acquire Palm indirectly by buying 3Com stock. The apparent mispricing created a low-risk arbitrage opportunity. A savvy investor could buy some 3Com shares outright, borrow some Palm shares, sell them, and repay the borrowed Palm stock in a few months when 3Com issued the Palm shares. Indeed, many investors did exactly that. At one point, the number of Palm shares borrowed to sell short was 147 percent of the shares outstanding. (The number could exceed 100 percent since shares could be borrowed only to be lent out again.) Even this additional supply of shares was not enough to quell the Palm enthusiasts. According to Professor Lamont and his co-author on one paper, Richard H. Thaler, a big part of the problem is that the market for borrowing shares is not a centralized market with quoted prices, but rather a highly disaggregated market. In many cases, it was quite difficult to find shares of Palm that could be sold - and when they could be found, the interest rate charged to borrow them was quite high. Short selling was not the only way to bet against Palm. One could also buy put options, which allowed the stock to be sold for a fixed price. But the options were also mispriced during this period, making such investments unattractive. So the anomaly persisted for many months. Eventually, of course, it disappeared: a few weeks before 3Com issued its remaining Palm shares, the prices reflected the appropriate ratio. But the short selling constraints seemingly allowed the mispricing to persist for an awfully long time. Many intelligent investors believe that short selling is a strong signal of subsequent price declines. Professor Lamont's work and that of several other academics find that this is so: stocks that are subject to large short selling tend to have lower subsequent returns. One might ask why short selling is not immediately reflected in the price of a stock. The reason appears to be related to the basic problem with short selling: there is no centralized market for borrowing stock, so it can take time to find shares to sell short. Typically, there is no problem in finding shares of large companies that are traded frequently. But shares of small companies, whose stock is lightly traded, may be hard to find. This finding suggests that the total amount of short selling might be a good predictor of stock market movements in general. Somewhat surprisingly, this turns out not to be true. In fact, during the bubble years, the aggregate amount of short selling declined as stock prices were bid up. As Professor Lamont and his co-author on another paper, Jeremy C. Stein, remark, 'Short selling does not play a particularly helpful role in stabilizing the overall stock market.' But again one must ask why not. One suggested answer is that short selling arbitrage has more risk than appears at first glance. For example, the owner of the shares can force the borrower to return them under certain conditions. Hence, the short seller might find his position unwound at an inconvenient time. This risk factor means that short sellers may want to take smaller positions than they would otherwise prefer. It appears that at least on some occasions, short selling constraints can disrupt the normal operation of supply and demand: when supply is constrained, stock prices end up being determined by those who are overly optimistic. Hal R. Varian is a professor of business, economics and information management at the University of California, Berkeley.

Subject: Re: Five Years After Nasdaq Hit Its Peak
From: johnny5
To: Emma
Date Posted: Thurs, Mar 10, 2005 at 12:27:13 (EST)
Email Address: johnny5@yahoo.com

Message:
I bet the naked shorts talk about effificent market hypothesis a lot.

Subject: I did not have sex with that hedge fund
From: johnny5
To: All
Date Posted: Thurs, Mar 10, 2005 at 10:36:20 (EST)
Email Address: johnny5@yahoo.com

Message:
Clinton is on CNBC talking about the 'supferfund' hedgefund and how he is going to help us little guys with only 5,000 get into them - johnny5's friends in hedge funds were right - big news today - this is the future for the poor people. Watch out richie, the barbarians are coming!

Subject: Re: I did not have sex with that hedge fund
From: johnny5
To: johnny5
Date Posted: Thurs, Mar 10, 2005 at 10:50:40 (EST)
Email Address: johnny5@yahoo.com

Message:
Clinton should talk to II, we can short I-shares for this!? http://news.ft.com/cms/s/016121f0-910b-11d9-8bff-00000e2511c8.html Clinton backing for first US retail hedge fund By David Wighton in New York Published: March 10 2005 02:00 | Last updated: March 10 2005 02:00 Bill Clinton is lending his name to efforts by an Austriancompany to bring 'hedge funds' to the US retail investor. One of the former president's first public appearances following his planned chest operation this week will be at the launch of a retail investment centre on New York's Fifth Avenue by Superfund Asset Management. The opening of the office, believed to be the first of its kind in the US, is an attempt to tap the growing retail demand for products previously the preserve of wealthy investors. The minimum investment in the company's funds is just $5,000 (£2,600), while many hedge funds require $1m or more. Mr Clinton is due to give a speech on the global economy at the launch on March 30. Christian Baha, 36, founder of the company, formerly known as Quadriga Asset Management, said: 'As governor of Arkansas, President Clinton paved the way for more liberalisation and social justice. It is our goal as well to give people with a lower income the opportunity to benefit from successful investment models with double-digit returns.' The company, which claims to be the world's biggest provider of managed futures funds to private investors, has been at the forefront of attempts to bring hedge fund-type products to a wider audience in spite of regulatory concerns. The Securities and Exchange Commission forced it to drop the term 'hedge funds' when it launched its managed futures funds in the US. Managed futures funds, which invest in a wide range of commodity and financial markets, are commonly viewed as a style of hedge fund and the company uses the term hedge fund in Europe. According to its website, Superfund's two US funds have returned 52 per cent and 82 per cent after fees since their start in November 2002.

Subject: Re: I did not have sex with that hedge fund
From: Pancho Villa
To: johnny5
Date Posted: Thurs, Mar 10, 2005 at 11:00:18 (EST)
Email Address: nm

Message:
Bulls(R) vs Bears(D)?

Subject: China Textiles Flood the U.S.
From: Emma
To: All
Date Posted: Thurs, Mar 10, 2005 at 10:31:47 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2005/03/10/business/worldbusiness/10textile.html?pagewanted=all&position= Free of Quota, China Textiles Flood the U.S. By DAVID BARBOZA and ELIZABETH BECKER SHANGHAI - In the first month after the end of all quotas on textiles and apparel around the world, imports to the United States from China jumped about 75 percent, according to trade figures released by the Chinese government. The statistics bear some of the first evidence that China's booming textile and apparel trade, unhampered by quotas, could be prepared to dominate the global textile trade and add to trade tensions around the world. The quotas came to an end on Dec. 31 as a result of an international agreement reached in 1993. In January, the United States imported more than $1.2 billion in textiles and apparel from China, up from about $701 million a year ago. Imports of major apparel products from China jumped 546 percent. Last January, for example, China shipped 941,000 cotton knit shirts, which were limited by quotas; this January, it shipped 18.2 million, a 1,836 percent increase. Imports of cotton knit trousers were up 1,332 percent from a year ago. These figures may be understated because China ships a large part of its goods through Hong Kong, and those shipments are not included. Fears that China is going to flood the world market with cheap textile exports have already inflamed tensions between Washington and Beijing because of worries about American manufacturing plants being closed and thousands of jobs being lost. Already, in January, the first month after global quotas were lifted, 12,200 jobs were lost in the United States apparel and textile industries, according to the Bureau of Labor Statistics. Some analysts have predicted that China could capture as much as 70 percent of the American market in the next two years. Before the end of quotas, about 16 percent of apparel sold in the United States came from China. Last year, the United States trade deficit with China set a record of $162 billion, making it the largest trade imbalance ever recorded by the United States with a single country. To be sure, some textile importers say this phenomenon may be a one-time surge. Companies, for instance, may have put off shipping goods at the end of last year to avoid the quotas. 'Nobody knows if it's going to last,' said Andrew Grossman, who runs GAV, a company that designs and manufactures clothes for Calvin Klein and Emanuel Ungaro. 'So you're not seeing it passed on to the consumer.' Because of uncertainty over currency fluctuations and the process of lifting quotas, apparel producers like GAV have not reduced their prices to retailers. Moreover, poor countries like Bangladesh, Cambodia and Sri Lanka are pressing Washington to pass legislation giving them lower tariffs to help support a crucial source of their livelihood. Some trade experts say that China has achieved its status over the years by providing questionable bank loans and subsidies to its industry. Still, it is clear that efforts to move toward more open trade have freed China and other countries of many textile and apparel quotas and restrictions. And they have set the stage for China to become a global textile and apparel behemoth, lowering clothing prices for consumers around the world but upsetting and rewriting current trade balances. The January evidence showed blockbuster gains for Chinese textile and apparel makers - a surge that some textile experts had been predicting long before the quotas came to an end. The 25 countries that are part of the European Union also registered big increases, importing about $1.4 billion worth of textile and apparel goods from China, up from about $975 million a year ago, a jump of 46 percent. 'This is not a surprise; it is not a revelation,' said Donald Brasher, president of Global Trade Information Services in Columbia, S.C., which tracks and releases trade figures from around the world and was the first to publish China's official trade statistics. 'We're going from a quota regime to a quota-free regime. And China's one of the most competitive producers. What do you expect?' But representatives of some of the nation's biggest textile and apparel manufacturers say the figures seem to bear out their worst fears: what they see as China's unfair dominance of the world textile trade because of possible currency undervaluation and government subsidies of big textile operations in China. 'The wolf is at the door and only the U.S. government can slam it shut, and it needs to do it right now,' said Cass Johnson, president of the National Council of Textile Organizations, a trade group that is pressing the administration to impose immediate limits on Chinese imports. 'The action the government takes or doesn't take will affect 30 million workers around the world and perhaps half a million in this country.' 'This isn't like the Y-2K crisis where everyone was afraid of a computer meltdown that never happened,' Mr. Johnson added. 'This is happening and the consequences are frightening.' In January alone, China shipped more apparel in some categories, like cotton trousers, than it had in the previous year and a half, representing approximately a fourteenfold increase, according to Mr. Johnson's trade group. For instance, China sent nearly 27 million pairs of cotton trousers to the United States; the quota had held the number to 1.9 million a year ago. There were also big increases in everything from underwear to gowns. China's customs figures, which were released March 1 to Global Trade Information Services, are often the earliest indication of China's exports to the United States. This Friday, the Commerce Department is expected to release its own trade data with China. However, the figures could include Chinese apparel that was shipped in December, before quotas ended, but that landed in the United States in January. Those figures might show less spectacular jumps in trade with the United States, according to textile industry officials. Many Democrats in Congress say that imports from China are the biggest trade problem for the United States. Representative Benjamin L. Cardin of Maryland, the ranking Democrat on the trade subcommittee of the House Ways and Means Committee, said in an interview that he would push the administration to pay more attention to China's trading practices. Some American manufacturers say that China is increasing exports by undervaluing its currency, which makes its products cheaper in dollars for American companies. The Bush administration says it has put pressure on Chinese officials to revalue their currency and take steps on other trade issues. Moreover, the administration did agree last year to put limits on some Chinese textile and apparel imports in advance of any market disruption. But importers and retailers, particularly the National Retail Federation, persuaded the Court of International Trade to issue an injunction against the administration's limits. Still, a continued surge in Chinese imports could lead to another push by the administration to provide relief for American apparel and textile manufacturers. If the surge is temporary, the administration is less likely to apply limits. Brenda Jacobs, the Washington trade counsel to the U.S. Association of Importers of Textiles and Apparel, said she was wary of the new Chinese figures and would wait to see the United States trade figures, which will be released on Friday. 'I just don't know what to expect; there will be shifting of production,' said Ms. Jacobs, whose group supported the end of quotas. 'But put this in context - there were a lot of companies that held off shipping goods in December in order to be sure they would not be caught in the quota system.'

Subject: 5 years later
From: Pete Weis
To: All
Date Posted: Thurs, Mar 10, 2005 at 10:20:11 (EST)
Email Address: Not Provided

Message:
From the NYT's: March 10, 2005 OP-ED CONTRIBUTOR Five Years Later and Still Floating By JAMES GRANT TODAY marks the fifth anniversary of the peak of the great millennial stock market. What were you doing when the lights began to dim? Were you a bull or a bear? Rich or otherwise? What about today? Are you inoculated against the new alleged sure things? Or perhaps you believe in the permanent hegemony of the dollar in the world's currency markets? In the inevitability of rising house prices? Or of falling interest rates? Answer true or false: the chairman of the Federal Reserve Board is clairvoyant. From the March 2000 top to the October 2002 trough, the United States stock market gave up more than half of its quoted value, some $9.2 trillion. Five years ago today, Cisco Systems was the world's biggest company by market capitalization. Its line of business, the computer networking business, was universally heralded as the industry of the future. Owners of Cisco still devoutly hope it is. They have lost 75 percent of their investment. Americans hate to lose, especially when it comes to money, and they've demanded an accounting of the misdeeds of the bubble era. A certain number of former chief executives, like Bernard Ebbers of WorldCom, have had to answer the charges against them in court. And Congress, in 2002, overhauled and stiffened the nation's securities laws. But the chairman, governors and staff of the Federal Reserve have yet to be called to account. Booms and busts are recurrent in history and in nations. In not every episode was there a culpable central bank. But in virtually every case, there was a clever neighbor. The unbearable sight of a neighbor getting rich in the stock market in the late 1990's made millions of Americans bipolar. Shopping at Wal-Mart, they would pay any price except full retail. Investing in the stock market, however, they would pay nothing but. By the late 1990's, stocks had lost any connection to the value of the businesses in which they represented partial ownership. Picture an artful consumer settling into a discounted hotel room for the night. Now try to imagine this savvy individual formulating a calculated financial decision to make a meal of the $10 cashews and the $6 candy bars on sale in the hotel minibar. That was Wall Street a half decade ago. And, to a lesser but still striking degree, it is still Wall Street today - and Main Street, too. The Federal Reserve did not stand idly by after the bubble burst. It radically reduced the interest rate it controls (the so-called federal funds rate), pushing it from 6.5 percent in May 2000 to 1 percent by June 2003. Alan Greenspan, the chairman of the Fed, had worried about a stock market bubble as early as 1995, had warned against 'irrational exuberance' in 1996, and batted around the possibility that there might, indeed, be a stock-market bubble in discussions with his Federal Reserve colleagues as late as 1999. But he was not the man to stick a pin in the bubble. Indeed, he himself became a vociferous booster of the 'New Economy.' In a speech he gave only four days before the Nasdaq touched its high, he sounded as if he were working for Merrill Lynch, cheering that 'the capital spending boom is still going strong.' Should the boom turn to bust, the chairman had testified before Congress less than a year before, the Fed would 'mitigate the fallout when it occurs and, hopefully, ease the transition to the next expansion.' In so many words, Mr. Greenspan promised that the Fed would make money cheaper and more plentiful than it would otherwise be. He would override the market's judgment with his own. Nobody in earshot quoted the words of the German central banker Hjalmar Schacht, who protested in 1927: 'Don't give me a low rate. Give me a true rate, and then I shall know how to put my house in order.' Someone should have. Interest rates are the traffic lights of a market economy. To investors, they signal when to go and when to stop. Under the Fed's bubble recovery program, every interest-rate light turned green. With no lights flashing red or even amber, investors sped through the financial intersections. They paid more for houses, office buildings and junk bonds than they would have if interest rates were not hugging 40-year lows. The proliferation of dollars helped to lift the stock market out of its doldrums - though the doldrums of 2002 were singularly shallow ones. In comparison to earlier bear market lows, bargains were scarce on the ground (by March 2000, stocks were uniquely overvalued; never before had a dollar of corporate earnings been so costly to buy). At the checkout counter, inflation was well-nigh invisible. On Wall Street, however, it was - and still is - on the rise. To hear Mr. Greenspan tell it in 1999, post-bubble damage control was as simple as cutting interest rates. He passed lightly over the possible consequences of the rates he cut. The list so far includes a bubble-like housing market (geographically localized but ferocious), an overheated debt market (this one spans the globe) and a steady depreciation in the foreign exchange value of the dollar. Consuming much more than it produces, the United States emits hundreds of billions of greenbacks into the world's payment stream every year - about $600 billion in 2004. The recipients of these dollars willingly invest them in American assets if the price is right. On the evidence of the dollar's decline, the price - the available rate of return - is too low. Ultra-low interest rates not only serve to inflate the value of bonds, stocks and real estate. They also entice investors in those assets to employ the elixir called 'leverage.' Leverage means debt. Borrowing at 2.5 percent, a speculator can invest at 3 percent and still make a handsome living - if he or she can be sure when 2.5 percent might be raised to 2.75 percent or 3 percent. The Fed is happy to oblige. Forswearing the element of surprise in its policy actions, it has told the market exactly what it proposes to do. Paying close attention, professional investors, including thousands of hedge funds, have borrowed fearlessly. A little fear would help to improve the quality of financial stewardship. 'A stock well bought is half sold,' said the Wall Street ancients. What they meant is that success in investing depends on one's entry price. As Congress debates an overhaul of Social Security to permit tax-advantaged saving by millions of new investors, a passage from the new Berkshire Hathaway annual report warrants attention. 'We don't enjoy sitting on $43 billion of cash equivalents that are earning paltry returns,' writes Warren Buffett, Berkshire's chairman. 'Instead, we yearn to buy more fractional interests similar to those we now own or - better still - more large businesses outright. We will do either, however, only when purchases can be made at prices that offer us the prospect of a reasonable return on our investment.' Five years later, the bubble is still unpopped.

Subject: Re: 5 years later
From: Terri
To: Pete Weis
Date Posted: Thurs, Mar 10, 2005 at 19:10:09 (EST)
Email Address: Not Provided

Message:
Terrific argument, to be well remembered. I hope there are some letters in response.

Subject: Re: 5 years later
From: Emma
To: Pete Weis
Date Posted: Thurs, Mar 10, 2005 at 10:36:00 (EST)
Email Address: Not Provided

Message:
Please add your thoughts to this essay. James Grant, by the way, has been bearish on stocks and bonds for more than 20 years.

Subject: Re: 5 years later
From: Pete Weis
To: Emma
Date Posted: Thurs, Mar 10, 2005 at 20:47:07 (EST)
Email Address: Not Provided

Message:
'Shopping at Wal-Mart, they would pay any price except full retail. Investing in the stock market, however, they would pay nothing but.' This line brought to light an ironic observation. Many small investors are caught up in investing in assets (be they real estate, stocks, etc) which have become anything but bargains and they shop heavily at discount stores like Wal-mart. While wealthy investors (especially insiders) have been selling assets like stocks heavily and buying at Nordstroms, Saks, NiemanMarcus, etc.

Subject: What is a Hedge Fund?
From: Terri
To: All
Date Posted: Thurs, Mar 10, 2005 at 05:52:24 (EST)
Email Address: Not Provided

Message:
A hedge fund is an investment vehicle offered to a select group of investors; a manner of private mutual fund. Because of the private nature of the funds, there are few regulations. The investment patterns of hedge funds vary widely, for the guidelines on investment are not restricted as they are for classes of mutual funds. Some hedge funds hedge to lessen risk, some accentuate risk by using leverage. Hedge fund is just a name, not a hedging requirement. Hedge funds are expensive, 2% or more fees on assets and 20% or more of profits. Investment minimums are usually above 500,000 dollars. There are usually restrictions on redemptions. There are wonderfully successful hedge funds, there are poor funds. Reporting requirements on returns are lax.

Subject: Re: What is a Hedge Fund?
From: Pancho Villa
To: Terri
Date Posted: Thurs, Mar 10, 2005 at 11:12:21 (EST)
Email Address: nma@hotmail.com

Message:
In a different article, this one carried by Slate magazine (http://slate.msn.com/id/1908/), Krugman discusses LTCM and the possibility that hedge fund compensation arrangements create the incentives to take inordinate risks since managers share in the upside but not the downside. He points out that if someone lends you a trillion, they have effectively given you a put option on whatever you buy: since you can always declare bankruptcy and walk away, it is as if you owned the right to sell those assets at a fixed price whatever happens to the market. He argues that the rational way to maximize the value of the options is to invest in the riskiest, most volatile assets since if you win, you win massively, and if you lose, you merely get some bad press and lose the money you yourself put in.

Subject: Re: What is a Hedge Fund?
From: Pete Weis
To: Terri
Date Posted: Thurs, Mar 10, 2005 at 09:51:11 (EST)
Email Address: Not Provided

Message:
Associated Press AP: Big Banks Look to Hedge Funds for Growth October 8, 2004 What's a major investment company to do when its ultra-high-worth clients - the high rollers whose portfolios can rival the size of small mutual funds - want to take their money away and put it in a hedge fund? If you're J.P. Morgan Chase & Co., you buy your own hedge fund. And not just any fund, but Highbridge Capital Management, considered one of the best around, with an average 20 percent annual return for investors for the last 10 years, before fees, and $7 billion under management. If you're any one of the other big Wall Street firms, you sit up and take notice. Once derided as shadowy investment vehicles only for people with massive amounts of money, hedge funds are lowering their net worth requirements - which typically range from $100,000 to over $1 million - so that the mere well-to-do can participate. Like mutual funds, hedge funds pool investors' money to try to earn the highest return possible. But, under law, hedge funds can use techniques that are off-limits to mutual fund managers, such as betting that stocks will decline in price and using derivatives and other complex financial instruments to hedge against risk. That allowed many of them to post profits through even the worst market declines. Because of the higher risks involved, government regulators require that hedge funds be limited to high net-worth individuals with ample investment experience. They also limited the number of investors a fund could attract to usually 100 or less, though current regulations are vague and this number has been relaxed over the past few years. In turn, hedge funds operate with far less government scrutiny - which can be attractive for wealthy investors hoping to make their money quietly. J.P. Morgan Chase's Sept. 27 acquisition of a majority stake in Highbridge was valued at around $1 billion. Highbridge, founded by Glen Dubin and Henry Swieca, has not stated publicly who will get the payout from J.P. Morgan's investment. While still a fraction of the size of the $7.5 trillion mutual fund industry, the amount of money invested in hedge funds has risen from $76 billion in 1995 to $795 billion at the beginning of this year. 'If you're a big investment bank and you don't have a hedge fund, then you're not playing with a full deck,' said David Beim, professor of finance and economics at the Columbia University Graduate School of Business. 'Every major bank will be driven in this direction.' The number of hedge funds surged from 2,080 in 1995 to 7,000 at the start of 2004, in part because anybody who can attract investors can set up a hedge fund. That, of course, has led to concerns about how these funds are regulated. 'The barrier to entry in the hedge fund business is zero, but the barrier to success is high,' said Bob Sloan, founder of S3 Asset Management. Sloan's firm helps small hedge funds with administration and trade execution by pooling their resources - much like a group of small businesses might pool their resources to bring health insurance costs down. 'If you add the potential costs of regulation, then that barrier to entry rises,' he said. According to the Securities Industry Association, 42 percent of hedge funds operating in the United States are not registered with any regulatory agency. Thirty-nine percent of fund companies are registered as investment advisers, 9 percent are registered as commodity pool operators and just 1 percent are registered broker-dealers. Nine percent are registered as two or more of the above. In July, the Securities and Exchange Commission approved a proposed new rule ordering most hedge fund managers to register with the agency. If formally adopted after a public comment period that ended Sept. 15, the rule would open the funds' books to SEC examiners and make them subject to an array of regulations including accounting and disclosure requirements. Those requirements could end up cutting into many funds' profits, forcing them to either absorb the higher costs of regulatory compliance to remain attractive to investors or increase their base fees to make up for it. Those base fees, while low, are in addition to performance fees that customarily total 15 percent to 20 percent of investors' returns after the funds meet predetermined minimum target returns. There is a great deal of debate on regulating hedge funds. SEC chairman William Donaldson is an advocate of increased scrutiny, citing the 46 cases brought by the SEC against hedge funds in the last five years that the commission claims defrauded investors of more than $1 billion. The SEC filed a civil suit in August against hedge fund operator Sterling Watters Group and one of its executives, alleging that the executive and the fund raised $27 million by lying to investors about the fund's performance when the fund was allegedly worthless. The fund has vowed to fight the charges. However, experts note that as a whole, the number of funds involved is on par with the larger mutual fund industry, and that most funds operate legally and ethically. 'These funds are not some kind of scam city,' said Michael Udoff, vice president and associate general counsel for the Washington-based SIA. 'Yes, there have been some problems, but these funds have significant benefits as well.' Hedge fund supporters, most notably Federal Reserve chairman Alan Greenspan, have said hedge funds are beneficial because their active trading strategies provide liquidity in the markets when volume would otherwise be low. And they argue that the SEC already has the regulatory oversight needed to pursue fraud claims under current regulations. In the end, observers believe the SEC will succeed in increasing its hedge fund oversight. And that may lead to consolidation within the hedge fund industry, more efforts like Sloan's to help funds overcome their higher costs, or more partnerships like the one between J.P. Morgan Chase and Highbridge. 'Hedge funds have to come into the mainstream at some point,' Beim said. 'And Wall Street will see an opportunity there.'

Subject: Re: What is a Hedge Fund?
From: Setanta
To: Terri
Date Posted: Thurs, Mar 10, 2005 at 07:42:23 (EST)
Email Address: Not Provided

Message:
so anyone can set up a fund and call it a hedge fund. there are no requirements/parameters that must be reached before it can be called a hedge fund? thanks but no thanks, i'll stick to other forms of investments!!! i want to control the risk, composition and duration to suit my investment appetite! if what you said is true then with selective reporting etc then one cannot make a truly informed investment decision. information may be incomplete or distorted, thats definately not my cup of tea!!! terri, i have to confess i'm not too familiar with the details of hedge/mutual funds fees etc. i've only just purchased a house and do not have enough disposable income for the next year or so to invest! i'm still painting and putting in bathrooms in the place and its amazing how expensive paint and tiles can be!!! my form of investment at the moment is detailed below. it carries no risk, and pays a guaranteed return of 29.5% p.a. it sounds like an albanian pyramid scheme but actually is a government backed savings initiative. 'The Minister for Finance introduced a new savings scheme in the Finance Act 2001. Its principal objective is to encourage regular savings by individuals. The main features of the scheme are as follows: For every amount saved in the scheme, the Exchequer will contribute to the individual saver’s account an additional 25% of that amount. This is equivalent to giving tax relief on savings at the standard rate of income tax. Income or gains from the savings investment are taxed at 23% and this will be deducted by the participating financial institutions at the end of the five years. The scheme commenced on 1 May 2001 and accounts must be opened before 30 April 2002 to benefit. The Exchequer contribution will apply for a five year period only. Every individual, who is resident in the State and 18 years of age or over, can save in one of these accounts. This is so whether an individual is married/unmarried, employed/unemployed, or working outside the home/working in the home. Each individual will be allowed only one account and on opening the account will be required to supply his or her PPSN (personal public service number) to the financial institution concerned. The maximum amount that an individual can lodge to an account in any one month will be €254(£200), and the Exchequer’s contribution to the account will be €63.50 for each €254 lodged. The minimum amount which must be saved by an individual in any one month, in the first year of an account, will be €12.70(£10), though an individual may save up to €254(£200) maximum in any month. After the first year an individual may save any amount in a month up to €254(£200) over the remaining 4 year period. Special saving incentive accounts will be managed, on behalf of an individual saver, by a range of bodies such as banks, building societies, credit unions, life assurance companies and fund managers. Exchequer contributions to each account will be sent directly to the account manager and added to the savings in the account. The Government will not be operating or guaranteeing the account or the return under them - this will be a matter between an individual and an account manager. It will be a matter for each individual to assess any level of risk they wish to undertake. It will be possible for an individual to transfer a special saving incentive account from one investment manager to another during the five years. An account can comprise investments in deposits, quoted shares, government securities, collective funds or life assurance products, as determined by the account manager. To obtain the maximum benefit from the savings in the scheme, the savings must be left for the full term which is five years. Where that is the case, tax at 23% will apply only to the difference between the total value of the assets at that point in the account less the amounts invested together with the Exchequer contribution. That means that only the income or gains generated by the investment of all moneys lodged in the account will be liable to tax. This will be deducted at the end of the five year period whether the funds are withdrawn from savings or not at that point. However, if there is an earlier withdrawal from an account (other than on death), the full amount withdrawn (both the savings and investment return) will suffer tax at 23%. An account cannot be used as security for a loan. The following sets out some examples of possible benefits. It should be noted that returns are just an assumption for the example; it will be a matter between the financial institution what return or gain is involved. Example 1: Joe opens an account with his preferred account manager and decides to save €50 a month for the five year period. Joe will save €3000 over the five year period and the Exchequer will contribute a further €750. If the return on investment is assumed to be 4% per annum the return on this €3,750 saved over a period would be of the order of €390 which would be taxed at 23% leaving a net gain of €300. Thus Joe would have €4,050 at the end of the five year period for €3,000 saved, a gain of €1,050 after tax. Example 2: Anne decides to open an account and save the maximum of €200 per month. She will save €12,000 over the five year period and the Exchequer will contribute €3000. Again assuming a 4% return the gain on this €15,000 would be €1,564 which would be taxed at 23% leaving a net gain of €1,204. Thus Anne would have €16,204 at the end of the five year period, a gain of €4,204 after tax.'

Subject: Ireland's Saving-Investment Plan
From: Terri
To: Setanta
Date Posted: Thurs, Mar 10, 2005 at 08:37:58 (EST)
Email Address: Not Provided

Message:
The Irish saving-investment plan is unique and possibly the finest public saving plan there has been. The Irish should take maximum advantage of the plan, for the is little possibility of a repeat opportunity. Wonderful. But, I still wish to know more of European mutual funds.

Subject: European Mutual Funds
From: Terri
To: Terri
Date Posted: Thurs, Mar 10, 2005 at 07:19:50 (EST)
Email Address: Not Provided

Message:
What is mutual fund investing like in Europe? What are the choices and costs? I suspect costs are quite high, but I do not know this.

Subject: NEW international vanguard vipers
From: johnny5
To: All
Date Posted: Thurs, Mar 10, 2005 at 04:48:15 (EST)
Email Address: johnny5@yahoo.com

Message:
Ok how should we re - allocate our assets with these new products Terri? They say FIDO has better permananet rates now than vanguard - does this saving in costs dictate we move the money? http://socialize.morningstar.com/NewSocialize/Asp/FullConv.asp?forumId=F100000015&convId=139512

Subject: Cost and Service
From: Terri
To: johnny5
Date Posted: Thurs, Mar 10, 2005 at 05:39:10 (EST)
Email Address: Not Provided

Message:
Building accounts at Vanguard allows for additional cost and service advantages over already fine cost and service. I trust Vanguard completely and find the choices as broad as I could wish. I am not interested in moving accounts. I wish to know Vanguard thoroughly, and use the products thoughtly.

Subject: Service indeed!
From: johnny5
To: Terri
Date Posted: Fri, Mar 11, 2005 at 00:41:44 (EST)
Email Address: johnny5@yahoo.com

Message:
You have gone a long way terri to convincing johhny5 he should get his uncle into vanguard. Johnny5 and his uncle went to see a local fee only financial planner today who charges 1% for asset management - similar to the rate vanguard wants to charge for an asset management account - he said johnnys uncle messed up big time getting the annuity from raymond james and is going to try and help him get out of it and that he should have got a fido or schwab account - he also said vanguard was a good place to put the money but that vanguard accounts only let you buy vanguard assets - where the fido account he could buy DVY and other things and that he would recommend fido over vanguard only for that reason. Now johnny5's uncle is getting very tired of all this 'money' business and wants to take it easy and turn it over very soon - looking here: http://www.siliconinvestor.com/readmsg.aspx?msgid=21123488 Equity funds report net cash inflows totaling $2.959 billion in the week ended 3/9/05 with Non-domestic funds reporting 80% of the Inflows ($2.367 Bil); International funds report net cash inflows ($2.016 Bil) to all Developed and Emerging regions with more funds reporting inflows (753) than any week since 2/18/04; Emerging Markets Equity funds report net inflows totaling $689 million, the largest inflow to the sector since 1/5/94, with fewer funds reporting net redemptions (46) than any week since 7/2/96; Exchange Traded Funds accounted for 54% of the net Equity fund inflows ($1.607 Bil) with largest inflows: $466 Mil to iShares Russell 2000 Index fund; $396 Mil to iShares MSCI EAFE Index fund; $252 Mil to iShares MSCI Emerging Markets Index fund; $121 Mil to Select Sector SPDRs Financial fund; and largest outflows: -$234 Mil from iShares NASDAQ Biotech Index fund; -$215 Mil from Select Sector SPDRs Energy fund; Taxable Bond funds report net cash inflows totaling $642 million led by: $185 Mil to Franklin Income funds; $131 Mil to iShares Lehman Aggregate Bond fund; $88 Mil to iShares Lehman 20 Yr Treasury Bond fund; $73 Mil to iShares Lehman TIPS Bond fund and large outflows led by: -$100 Mil from iShares Lehman 7-10 Year Treasury Bond fund; -$57 Mil from iShares Lehman 1-3 Year Treasury Bond fund Taxable Bond fund sectors reporting the largest net cash inflows are Investment Grade Corporate Bond funds ($437 Mil) and International & Global Debt funds ($261 Mil); High Yield Corporate Bond funds report net cash outflows totaling -$141 million; Money Market funds report net inflows totaling $123 million; Municipal Bond funds report net cash inflows of $48 million. Is this fee based guy right about vanguard and they are limited in what you can buy through thier brokerage account or is he just another salesman with some backroom comission deal with Fido?

Subject: Simplicity
From: Terri
To: johnny5
Date Posted: Fri, Mar 11, 2005 at 11:31:25 (EST)
Email Address: Not Provided

Message:
Vanguard has all that is needed from mutual funds, to a variable annuity that has no sales charge or penalty for withdrawal, to a brokerage, to banking. There are times however when simplicity is called for.

Subject: Re: Simplicity
From: Terri
To: Terri
Date Posted: Fri, Mar 11, 2005 at 12:07:23 (EST)
Email Address: Not Provided

Message:
Adding to assets at Vanguard, lowers costs even further.

Subject: Re: Service indeed!
From: Jennifer
To: johnny5
Date Posted: Fri, Mar 11, 2005 at 10:18:29 (EST)
Email Address: Not Provided

Message:
Vanguard allows you to easily buy stocks, bonds, or mututal funds of other companies.

Subject: Re: Service indeed!
From: johnny5
To: Jennifer
Date Posted: Fri, Mar 11, 2005 at 11:26:46 (EST)
Email Address: johnny5@yahoo.com

Message:
Thanks Jennifer, I will ask the planner why he is giving inaccurate info on vanguard.

Subject: Re: Service indeed!
From: Jennifer
To: Jennifer
Date Posted: Fri, Mar 11, 2005 at 10:22:52 (EST)
Email Address: Not Provided

Message:
Vanguard has superb choices of investments. Also, you must know exactly what sort of annuity has been purchased.

Subject: Politics killing America
From: johnny5
To: All
Date Posted: Thurs, Mar 10, 2005 at 04:18:48 (EST)
Email Address: johnny5@yahoo.com

Message:
Well johnny5 watched the following programs on cspan3 tonight - and after these and the Economic Hit Man viewings - if there are any of you that believe you do not live in a very manipulated world - why do you think that with the evident truths being reported to you? More importanly, rubin, peterson and others continually speak about congress and government so divided that they can't get anything done to fix the problems - partisan politics killing our ability to adapt - if this institution is so bogged down they cannot serve the people they are there to work for - what can we fundamentally do to fix this? I think we have a problem, we have indentified it, now we need to make progress on fixing it and we can't because of politics - how sad. Perfectly Legal: The Covert Campaign to Rig our Tax System Washington, District of Columbia (United States) ID: 181339 - 03/30/2004 - 0:58 - $19.95 Johnston, David Cay, Correspondent, [New York Times], Business Mr. Johnston talked about his book Perfectly Legal: The Covert Campaign to Rig our Tax System to Benefit the Super Rich - and Cheat Everyone Else, published by Portfolio. The book is about the reality of how the tax system actually operates after the politicians pass the laws. The book discusses the tax loopholes that the rich can afford to exploit, corporate schemes that benefit the executives at the expense of the workers and stockholders, the taxes that are encroaching upon the middle class, and the weakness of the enforcement system. Running on Empty Institute for International Economics Washington, District of Columbia (United States) ID: 183041 - 08/09/2004 - 1:41 - $29.95 Bergsten, C. Fred, Director, Institute for International Economics Rubin, Robert E., Secretary (1995-99), Department of the Treasury Peterson, Peter G., Chairman, Blackstone Group Mr. Peterson talked about his book Running On Empty: How The Democratic and Republican Parties Are Bankrupting Our Future and What Americans Can Do About It, published by Farrar, Straus and Giroux. Mr. Peterson argued that America is headed towards an economic meltdown because of the large deficit the country runs every year. He asserted that big tax cuts and heavy spending have contributed to the massive debt the country currently has and warned that if measures are not taken soon the economy will suffer dramatically. Following Mr. Peterson's remarks he joined Robert Rubin and C. Fred Bergsten in a panel discussion. Audience questions were also answered. The Cheating of America Borders Books & Music Washington, District of Columbia (United States) ID: 163845 - 04/03/2001 - 0:52 - $29.95 Lewis, Charles, Executive Director, Center for Public Integrity Allison, Bill, Author Mr. Lewis and Mr. Allison talked about their book The Cheating of America: How Tax Avoidance and Evasion by the Super Rich Are Costing the Country Billions, and What You Can Do About It, published by William Morrow & Co. The book asserts that the federal treasury loses billions of dollars each year as a result of unpaid taxes. The authors developed statistics about the extent of the problem of tax evasion and what they feel is an inadequate response by the Internal Revenue Service. After the presentation the authors answered questions from members of the audience.

Subject: Rising Long Term Interest Rates
From: Terri
To: All
Date Posted: Wed, Mar 09, 2005 at 21:51:22 (EST)
Email Address: Not Provided

Message:
Rising long term interest rates will further limit home refinancing and equity loans, and this will force consumers to expensive credit card debt. This may well be happening already. A further reason to be wary of a slowing of consumer spending. Because of this I seriously doubt the Federal Reserve will change the pace of tightening.

Subject: Good point.....
From: Pete Weis
To: Terri
Date Posted: Thurs, Mar 10, 2005 at 10:00:54 (EST)
Email Address: Not Provided

Message:
regarding shift from home equity to credit card debt. Now we begin to see why credit card issuers pushed so heavily for changes to bankruptcy laws. As Emma observed - risk, in so many ways, is being shifted from US corporations to US households - 'barbarians at the gates'.

Subject: Going upside down
From: Pete Weis
To: All
Date Posted: Wed, Mar 09, 2005 at 21:49:06 (EST)
Email Address: Not Provided

Message:
One thing which Buttonwood was not considering here was the selling expenses of a house. While a 20% or more correction in the housing market would not be unexpected in a market which has risen 100% in the last 5 years in a number of highly populated regions of the US, only a 10-13% drop could be serious. The reason - it often takes anywhere from 7-10% of the overall selling price of the house to close the transaction - after commissions, excise taxes, lawyer fees and escrow costs. A 10-13% drop in the housing market reduces the seller to the break even point in many cases. Any more of a drop puts many sellers in negative territory. Mar 8th 2005 From The Economist Global Agenda House prices and America’s mortgage-finance giants have both grown too big for their boots. Will one trip up the other? BUTTONWOOD had to chuckle at the photos of Martha Stewart, the world’s most tasteful jailbird, just released from Cupcake Correctional Facility last weekend. Adorably dressed, she looked suspiciously botoxed and understandably cheerful—if only because shares in Martha Stewart Living Omnimedia had more than doubled in price during the previous seven months (though they are down this week). She would be a role model, were it not for the record. It is hard to know whether the shares have risen at the prospect of her manicured hand profitably on the tiller once more or because home-furnishing companies usually rise when the housing sector flourishes. And flourishing it is. The price of residential housing in America rose faster last year than at any time since 1979, says Freddie Mac, one of the two big government-sponsored entities (GSEs) that provide mortgage liquidity. The ratio of house prices to rents is now a third above its average level from 1975 to 2000, on calculations by The Economist. Though the pace is likely to slow a bit this year, people keep on buying, and borrowing to do so. There are all sorts of tempting mortgages on offer, including 110 LTVs (110% loan-to-value mortgages), which lend the full price of the house plus a bit extra for transaction costs. Turnover is frenetic: as one commentator puts it, “Day traders in shares have become day traders in real estate.” Does all this amount to a bubble? Without a doubt. Alan Greenspan’s attempt to save capitalism from the burst dotcom bubble in 2000 (and the effects of terrorist attack in 2001), by cutting short-term interest rates from 6.5% in 2000 to 1% in 2003, produced a new bubble in the credit markets. One sign of that is the compression in bond yields, with riskier assets paying investors only slightly more than governments and blue chips. Another is the debt-fuelled explosion in property prices. What is less clear is the link between America’s huge and hugely troubled mortgage-finance behemoths—Fannie Mae and Freddie Mac—and the house-price bubble. If these custodians of $3 trillion in securitised mortgages back out of the market—either because there is further bad news to emerge from within them or because their masters make them—could this prick the bubble by making mortgages scarcer and dearer? And would Fannie and Freddie go bust if the bubble popped? The GSEs, created by statute but both private-sector companies these days, are supposed to pump liquidity into the lower end of the housing market. They do this by buying mortgages from banks and other lenders, most of which they then pool as collateral for marketable securities, collecting a “G-fee” for guaranteeing repayment. Some mortgages and mortgage-backed bonds, however, they hold in their own portfolios. The difference between what they pay to borrow (just a little more than Treasuries, as they are assumed to be guaranteed by the federal government) and what they make on their holdings (less the cost of hedging against interest-rate risks, plus the G-fees they earn) has made both companies among the most consistently profitable of the S&P 500. But those profits have been called into question. The agencies’ regulators have stumbled more than once on accounting fiddles at both and are now making Fannie Mae restate four years of earnings, slow the breakneck pace of growth in its portfolio, and strengthen capital. Mr Greenspan seems keen to get mortgage lending back into the hands of banks whose behaviour he can influence. Congress, meanwhile, may enact stronger controls over Fannie and Freddie. Economists at the Federal Reserve reckon that the GSEs pass on to consumers only seven basis points of the 15-18 point spread between the mortgages they buy and ordinary mortgages. Richard Baker, a Republican congressman who sits on one of the committees considering the GSEs’ future, says he worries that Fannie and Freddie have forgotten their mission to help low-income people and instead have become “a very sophisticated hedge fund which uses its leverage in the marketplace given by the taxpayers to yield significant profits for shareholders”. If the agencies are cut back dramatically, how much will it affect the markets? Looking at it another way, how much is the house-price bubble due to the availability of this huge pool of cheap credit? Not much, some would say. After all, many other countries, including Britain, have managed to produce perfectly good house-price bubbles without Fannie and Freddie, so the condition may have more to do with general global liquidity and tax breaks. More specifically, house prices in America galloped merrily on in 2004 while Fannie and Freddie were less active than they had been in years. Rising house prices pushed the size of many mortgages up through the limit ($359,650 at present) that the GSEs are allowed to buy. Many borrowers chose more complicated mortgages, such as hybrids (partly fixed-rate, partly floating), which the GSEs find harder to buy up and securitise. The result of all this is that the GSEs’ furious pace of securitising mortgages slowed in 2004, and their portfolios were virtually flat. Since then, Fannie has slimmed its portfolio by another 17%. It is too soon to know whether the GSEs can really absent themselves from the market without its noticing. Despite everything, says Jim Vogel, senior vice-president of FTN Financial Capital Markets, “everyone out there still assumes that there’s a put [option to sell] at some price back to Fannie and Freddie.” And there is plenty of money around to lend at the moment. Though Fannie’s shares, unlike Martha Stewart’s, have fared unhappily over the past few months, yields on its long-term debt have been reasonably resilient. If house prices dropped and defaults rose sharply, could that seriously trip up Fannie and Freddie? That would depend on how sharp the changes were. The agencies are prohibited from buying mortgages that represent more than 80% of the value of the house. Prices would have to fall by more than 20%—by much more, in areas where prices have risen most—before Fannie and Freddie took a serious hit. All this is not to say that a sharp change in either the agencies’ status or house prices would not roil the markets. But it seems that Congress could dare to be bold, paring back the GSEs’ portfolios and giving a new, stronger regulator broader powers. The boldest move of all, of course, would be to give up altogether on subsidising the American dream of home ownership for all. Surely Congress would not go that far? Buttonwood thought not—until a colleague pointed out that Britain had had a similar dream, financed through tax breaks on mortgage interest. Where are those tax breaks today? History, pure history. Just like Martha Stewart’s time inside.

Subject: Re: Going upside down
From: Terri
To: Pete Weis
Date Posted: Wed, Mar 09, 2005 at 21:52:59 (EST)
Email Address: Not Provided

Message:
Important point on selling cost. Darn.

Subject: Papa Roach's 'Unprepared world'
From: Pancho Villa
To: All
Date Posted: Wed, Mar 09, 2005 at 20:52:13 (EST)
Email Address: nma@hotmail.com

Message:
Global: An Unprepared World Stephen Roach (New York) Globalization is a wonderful subject to debate. Basically, that’s all I’ve been doing for most of the past two weeks — first at our own MacroVision exercise and more recently at the World Economic Forum in Davos. In many respects, these were two of the most intellectually enriching weeks I have spent in a long time. Yet as I now decompress and ponder the experience, I am left with a nagging sense of concern. As I see it, investors are largely unprepared for some big changes coming in the global landscape in 2005. This potential disconnect is most evident in the debate over the US and China — currently the twin engines of global growth. America’s imbalances are widely recognized as both worrisome and unsustainable. There is a minority that believes in the new paradigm of the fungible global saving pool — that the allocation of capital, consumption and production now flows seamlessly to its destinations of highest return or comparative advantage. In its simplest sense that translates into a world where China produces, America consumes, and the rest of the world gladly pays the bill and goes along for the ride. But with global imbalances expanding at an accelerating rate, even advocates of this point of view are starting to have second thoughts. America’s deficits are now being framed as a problem that will come to a head sooner or later. The hope of the global consensus is that it will be later. As I have noted ad nauseum, macro is not particularly good on these issues of timing — in making the distinction between the proverbial sooner or later(Sooner or later we learn to throw the past away...). But my suspicion is that 2005 will be a critical year in being able to make that distinction. I rest my case mainly on the likely behavior of the Federal Reserve. At present, the US central bank is running an utterly absurd monetary policy of maintaining a “zero” real short-term interest rate — a nominal federal funds rate of 2.25% that is basically equal to the core CPI inflation rate. That will undoubtedly change this week, but not by much. When the dust settles after what is likely to be yet another “measured” tightening of 25 basis points, the real short-term interest rate will only be fractionally in positive territory. This is well below what most believe to be a “neutral” position for the Fed’s key policy lever — somewhere in the 2% zone in real terms. Which, of course, says there is a good deal more tightening to come if the Fed is serious about containing the inflationary and speculative risks it cited in the minutes of the December FOMC meeting. This could be a recipe for a flash point that has a lot to say about the “sooner or later” aspect of global rebalancing. Last year’s Fed tightening was inconsequential — all it did was lift short-term real interest rates from negative territory to zero. This year’s Fed tightening is likely to be a very different animal — taking the policy rate from zero toward a large enough positive number that deals with the very risks the Fed, itself, is now citing. For financial markets, the zero real federal funds rate is the candy of the carry trade — allowing investors and speculators to borrow short and pocket the spread anywhere else on the yield curve. In 2005, the Fed is going to take the candy away. This points to a likely unwinding of a multitude of carry trades that have driven spreads on risky assets to unbelievably low levels. Those include high-yield and emerging market debt, investment-grade debt, and the “refi trade” that has underpinned consumer equity extraction from increasingly overvalued homes. This underscores a potentially critical moment of reckoning for the US economy and for a US-centric global economy. Extraordinary monetary accommodation has been the glue that has held a post-bubble US economy together these past five years. But the easy money has given rise to an asset-driven saving and spending mindset. That development, in conjunction with an unprecedented shift in the federal government’s saving position — a budget that went from surplus to deficit — has pushed America’s income-based saving position to record lows: The net national saving rate has averaged just 1.5% since early 2002. Lacking in domestic saving, the rest is history — a US that has to import surplus saving from abroad to grow its economy, and run massive current-account and trade deficits to attract the foreign capital. And, of course, Japan and China have led the charge in financing this asset-dependent spending binge because they couldn’t stomach the alternative. Like in 1994, 2005 is likely to be the year when the Fed finally gets “real” on real short-term interest rates and the carry trades they have spawned. But unlike the case in 1994, more than a decade later, the US has been transformed into an asset-dependent economy that has given rise to massive global imbalances. To me, all this smacks of sooner rather than later on the rebalancing watch. Based on all my discussion and debates in the past few weeks, I would say that the world is largely unprepared for this possibility. The Fed is widely thought to be the world’s central bank and wouldn’t dare risk such an outcome, goes the logic. By inference, that means the world is perfectly content with the alternative — the folly of financing itself on an increasingly shaky foundation of ever-risky carry trades. A truly independent central bank has no choice other than to take the candy away. And a US-centric world will have to figure out how to cope with the aftershocks. The key question, in my view, is whether the Fed has the courage to act. Similarly, an increasingly integrated global economy has to find a much better way to cope with China. The China debate has now reached a feverish pitch — especially on the RMB currency issue. The Chinese were well represented in Davos and every utterance by a Chinese official or banker was scrutinized by the press and the markets for hints of any imminent action on this front. In one of the final sessions at the World Economic Forum, Li Ruogu, Deputy Governor of the People’s Bank of China, stated unequivocally that the decision has already been made to shift gradually to a more flexible currency regime. But he went on to underscore that there is no timetable for such an action. But, as I saw it, the message from China was sooner rather than later on this count as well. The operative word on this issue came from the senior member of the Chinese delegation at Davos — Vice Premier Huang Ju. China, he stated, was well advanced in its preparation for a more flexible currency regime. If that wasn’t a wake-up call, the next session at the World Economic Forum was. Literally, a few minutes later on the same stage, John Taylor, US Under Secretary of Treasury, used precisely the same language in stating that China is now taking steps to prepare for the shift a more flexible currency system. The emphasis on the word “prepare” stands in sharp contrast to earlier language, which always contained references to terms such as “stability” or “fixed.” Those words were not used in Davos. I don’t want to read too much into the nuances of language, but I think there is an important message here. I don’t think it was an accident that both Chinese and US officials selected the same new word to characterize an issue that has taken on increasing significance in world financial markets. Personally, I think the Chinese currency issue is totally misunderstood. For starters, I can’t conceive of a likely move in the RMB that would have any impact on Chinese competitiveness or on the US current-account deficit. Sure, if the peg goes, other Asian currencies could follow suit — allowing the dollar to continue the requisite decline that America’s current-account deficit requires. That would undoubtedly also trigger some diversification out of dollar-denominated assets by foreign investors and central banks — only underscoring the likely of a back-up in longer term US interest rates that would have happened in any case. The only RMB outcome that would shock the markets would be an Asian-crisis-style adjustment. With over $600 billion of official foreign exchange reserves at its disposal, the odds of that are close to zero, in my view. China has ample resources to manage any currency adjustment it wants. I do think this is a big deal for China. Over the past 26 years, China has made phenomenal progress largely by successfully executing an open, trade-oriented development model. It has relied on its enormous reservoir of national saving to improve the infrastructure that supports its manufacturing platform. And it has used this infrastructure, along with aggressive tax incentives and a vast low-cost labor force, to attract huge inflows of foreign direct investment. Currency stability is key for any outward-looking growth model. But now China is coming of age and must shift to a more balanced, market-oriented framework. To do that, it needs to focus more on stimulating domestic demand — its consumption share of GDP is only about 55%. At the same time, China also needs a more flexible policy apparatus to smooth out the inevitable cyclicality of market-driven adjustments. That points to flexibility in terms of fiscal, monetary, and yes, even currency policy. The Chinese know and understand this, and are definitely moving in that direction. Timing is their business — not ours. But when they shift currency regimes, I think it will be a very positive sign of the maturation of the Chinese growth miracle. I don’t think the rest of the world gets this point at all. All this speaks of world financial markets that are not well positioned to cope with two of the biggest issues on this year’s macro agenda — a significant move in real short term interest rates in the US and the deeper implications of an eventual shift in China’s currency regime. Timing is always tricky in this business, but I think the Chinese have put it best: The time to prepare is now.

Subject: Re: Papa Roach's 'Unprepared world'
From: Jennifer
To: Pancho Villa
Date Posted: Wed, Mar 09, 2005 at 21:09:37 (EST)
Email Address: Not Provided

Message:
http://www.morganstanley.com/GEFdata/digests/20050131-mon.html January 31, 2005 Link to article.

Subject: Re: Thank u
From: Pancho Villa
To: Jennifer
Date Posted: Wed, Mar 09, 2005 at 21:13:06 (EST)
Email Address: nma@hotmail.com

Message:
Thank you dear Jennifer

Subject: Dreaming of Hedge Funds
From: Terri
To: All
Date Posted: Wed, Mar 09, 2005 at 20:02:33 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2004/12/09/business/09scene.html?ei=1&en=d2de508be5f474c3&ex=1111414828&pagewanted=all&position= There are surely superior investors and superior programs of investment, but there is no reason to think that the trillion dollar hedge fund industry delivers superior returns to index funds. Rather, hedge fund as a class appear to trail indexes by the costs of the funds. A trillion dollars competing in markets tends to lose any particular advantage smaller fund sources might have had. We should be quite careful before we look to hedge funds as a source of returns that easily better market indexes.

Subject: Why hedge funds underperform from a hedge manager
From: johnny5
To: Terri
Date Posted: Thurs, Mar 10, 2005 at 04:12:07 (EST)
Email Address: johnny5@yahoo.com

Message:
http://www.safehaven.com/article-2717.htm March 09, 2005 Short Selling as Vice and Virtue by Clif Droke The broad market in recent weeks hasn't exactly been kind to the shorts. Depending on the stock sector in question, short squeezes have become quite common and have killed off more than a few bears. But have the bears been wrong altogether in their urge to sell short the stock market? Or have they just been a bit too early? To answer that question you need only to turn to the financial press for some valuable clues. One reason why the market has been immune from sustained decline of late was uncovered in a Feb. 28 Business Week magazine article entitled 'Why the shorts have long faces.' The article looks at how traders are taking advantage of a new SEC rule to bid up shares of shorted stocks. Business Week explains that a new SEC regulation is cracking down on the practice of 'naked shorting,' in which brokers executive a short sale without having a firm arrangement to borrow shares of the stock being shorted...and then discover they can't locate the necessary stock. 'The new regulation is prompting brokers who can't deliver stock within 13 trading days to close out customers' short positions,' says Business Week. The article goes point to point out that since early January major stock exchanges have had to publish daily lists of companies for which sellers have failed to deliver sizable amounts of stock to buyers in a timely fashion. 'The daily lists signal to other trades that they can pluck profits by mounting a short squeeze in stocks, such as Martha Stewart Living Omnimedia, that are already moving up on positive news. Evidently, some brokerage firms are passing on to their customers fees-per-month-per-share on some companies that have hard-to-borrow stocks. For instance, at Harrisdirect, investors who want to short the stock of Travelzoo Inc. Must pay an extra fee of $31.40 a month per 100 shares they want to short, according to Business Week. According to the article, Harrisdirect officials acknowledge that the fees are putting a damper on short-selling activity. 'It has had an impact,' says Harrisdirect's chief operating officer Michael Hogan. 'In some of these stocks the economics become uninteresting.' Aside from the clear implication that the shorts have been getting squeezed a lot in recent weeks (in part reflecting the upside tendency of the major indexes), what is the point of this magazine article? Could it not be to scare away potential short sellers for the next stock market top...which isn't too far away? I think it just may be! Another example of the art of short selling being portrayed as 'vice' in the financial press was found in a recent Financial Times guest article written by James Altucher, managing partner at a hedge fund and author of the best-selling book 'Trade Like a Hedge Fund.' Altucher's article was entitled 'The long and the short of short trading' and in it he asks, '...does shortselling turn out well in general?' His answer: 'I am not sure that...[it] works out profitably.' He goes on to offer a look at how well professional short-sellers and hedge funds in general fare in shorting stocks. 'On average,' he says, 'they are uninspiring. Take 2001. The S&P was down more than 10 per cent, the NASDAQ more than 20 per cent. The events of September 11,2002 caused the market to crash and many stocks hit multi-year lows. So how did the shortsellers do? The CSFB/Tremont Dedicated Short bias Index, which tracks the hedge funds that only sell short, was down 3 per cent -- better than the market but not great.' He concludes by asking, 'So does shorting ever work?' His answer: 'That is a tough call. For some hedging purposes, shorting is acceptable. I avoi dit. It leaves me with less cocktail-party fodder, but, I hope, more money.' Not exactly high praise from a professional in a sector who is presumed to be adept at short selling. My observation has been that whenever the mainstream financial press draws attention to the practice of short selling (which is rare) it is usually for the purpose of either encouraging short selling at precisely the wrong time, or else discouraging shorting when it might otherwise be a profitable course of action. For example, during the mini-bear market decline of August-October 1998, the Wall Street Journal ran an article in the Oct. 14, 1998 edition headlined, ''Bullet' strategy makes comeback as traders find a way to skirt rules on short selling.' It went on to describe the bullet strategy of 'married puts,' a complicated technique allowing traders to sidestep rules that prevent short sales when the stock's share price already is falling steadily. 'You can really crack a stock this way,' one trader was quoted as saying. Of course, by the time this article was published the market had already put in a bottom and from there rallied back up to a new high before the year was through. Flash forward to the October 2002 stock market bottom. CNBC was expounding on the 'virtues' of short selling and was obviously trying to encourage the public to start heavily shorting. From there of course the market took off and rallied virtually straight up into December. Suffice it to say the mainstream financial press has an unenviable record of telling people when to short (or when NOT to short) at the wrong times! The moral to this story is that you shouldn't always follow the lead of the mainstream press, especially on the subject of short selling! We'll have more to say on the subject of shorting in a later commentary... Clif Droke ClifDroke.com

Subject: C-span3 tonight - the Rich cheat taxes
From: johnny5
To: All
Date Posted: Wed, Mar 09, 2005 at 18:20:51 (EST)
Email Address: johnny5@yahoo.com

Message:
Time to get mad America - don't think about the poor somalies starving in africa - think about those rich crooks above you that live the good life. For you guys in China - you should be able to watch the live web feed off the c-span website with an anonymous proxy server. 02:05 am 1:33 (est.) Forum Running on Empty Institute for International Economics C. Fred Bergsten , Institute for International Economics Robert E. Rubin , Department of the Treasury 10:00 pm 1:33 (est.) Forum Running on Empty Institute for International Economics C. Fred Bergsten , Institute for International Economics Robert E. Rubin , Department of the Treasury http://inside.c-spanarchives.org:8080/cspan/cspan.csp?command=dprogram&record=164557288 Mr. Lewis and Mr. Allison talked about their book The Cheating of America: How Tax Avoidance and Evasion by the Super Rich Are Costing the Country Billions, and What You Can Do About It, published by William Morrow & Co. The book asserts that the federal treasury loses billions of dollars each year as a result of unpaid taxes. The authors developed statistics about the extent of the problem of tax evasion and what they feel is an inadequate response by the Internal Revenue Service. After the presentation the authors answered questions from members of the audience. http://inside.c-spanarchives.org:8080/cspan/cspan.csp?command=dprogram&record=138631350 Running on Empty Institute for International Economics Washington, District of Columbia (United States) ID: 183041 - 08/09/2004 - 1:41 - $29.95 Bergsten, C. Fred, Director, Institute for International Economics Rubin, Robert E., Secretary (1995-99), Department of the Treasury Peterson, Peter G., Chairman, Blackstone Group Mr. Peterson talked about his book Running On Empty: How The Democratic and Republican Parties Are Bankrupting Our Future and What Americans Can Do About It, published by Farrar, Straus and Giroux. Mr. Peterson argued that America is headed towards an economic meltdown because of the large deficit the country runs every year. He asserted that big tax cuts and heavy spending have contributed to the massive debt the country currently has and warned that if measures are not taken soon the economy will suffer dramatically. Following Mr. Peterson's remarks he joined Robert Rubin and C. Fred Bergsten in a panel discussion. Audience questions were also answered.

Subject: A book for you Terri
From: johnny5
To: All
Date Posted: Wed, Mar 09, 2005 at 17:36:54 (EST)
Email Address: johnny5@yahoo.com

Message:
One of the comments mentions the austrians. I agree carrying gold is not fashionable or trendy, that plastic credit card is so much more chique at the macy's. http://www.amazon.com/exec/obidos/tg/detail/-/0471389455/qid=1110407177/sr=8-1/ref=pd_csp_1/103-6179943-8706260?v=glance&s=books&n=507846 Fascinating and entertaining take on the history of boom/bust cycles in markets, that functions also as a reply to the monetarists of the Austrian school. The monetarists seem to see panics and crashes (such as those that heralded the beginning of the Great Depression) as the function solely of improper monetary policy by the central bank. Kindleberger, in my opinion correctly, realizes that while monetary policy may either enable speculation or exacerbate a panic, one must not ignore the behavioral psychology that grips the masses of investors once a mania has set in. He also sees a panic as the natural and inevitable consequence of an investment mania. It seems impossible to have a mania without a panic, as night follows day. Are you folks at the Fed listening? Pumping more air into the bubble through the current ultra easy money policy could well be simply setting us up for an even bigger set of problems down the road. Whether or not you agree with the author, he has written a very thoughtful and important book.

Subject: Charles Kindleberger
From: Terri
To: johnny5
Date Posted: Wed, Mar 09, 2005 at 17:52:36 (EST)
Email Address: Not Provided

Message:
Manias, Panics, and Crashes: A History of Financial Crises by Charles P. Kindleberger An excellent book, by a traditional economist. A keynesian.

Subject: Hedge Funds
From: Terri
To: All
Date Posted: Wed, Mar 09, 2005 at 17:20:15 (EST)
Email Address: Not Provided

Message:
Hedge funds are interesting in that the managers who run them have far more freedom than mutual fund managers. A hedge fund manager can use a range of investment strategies. The potential for gain and loss is accentuated because leverage is often used by the managers. The idea of a hedge fund is to try to exploit market anomolies, and the techniques range from using mathematical models to careful team observations. The only problems with hedge fund investing for many investors are minimum investment levels that are often in the million dollar range and a lack of oversight. Beyond this, an investor must know what choices are available and be accepted by managers with superior reputations. Again, hedge funds are simply not going to be available for the vast majority of investors and if they were so available returns would quickly appromimate market returns minus costs. Even now, there is evidence that hedge funds as a whole have returns that approximate market averages minus costs.

Subject: Hedge Fund Data Management
From: Terri
To: Terri
Date Posted: Wed, Mar 09, 2005 at 19:39:08 (EST)
Email Address: Not Provided

Message:
http://www.nytimes.com/2004/12/09/business/09scene.html?ei=1&en=d2de508be5f474c3&ex=1111414828&pagewanted=all&position= Hedge Funds Better at Managing Data Than Managing Money By ALAN B. KRUEGER HEDGE funds have grown at supersonic speed. In 1990, about $50 billion was invested in hedge funds; today, the amount is estimated at $1 trillion. Does superior performance explain the rapid growth? No, says Burton G. Malkiel, a professor of economics at Princeton University, and Atanu Saha, a managing principal at the Analysis Group, a consulting firm. The researchers recently completed a study that challenges the often-made claim that hedge funds, in general, produce lofty returns. Hedge funds are a diverse set of investment funds that typically cater to wealthy clients and institutions. The funds pursue various strategies, like holding both long and short positions, and often employ substantial leverage. Their fees are usually much higher than those charged by mutual funds or other financial assets. Data on the performance of hedge funds comes from indexes like the CSFB/Tremont Index or the Van Hedge Fund Index. Those indexes are generated by companies that advise investors and operate funds. 'Hedge funds in aggregate,' Van Hedge Fund Advisors boasts on its Web site, 'in most multiyear periods, have provided both superior returns and lower statistical risk than the S.& P. 500 or mutual funds.' The catch, according to Professor Malkiel, is that the information on performance is voluntarily provided to the organizations who track the funds. Because a good record helps attract investors, funds have a tendency to start reporting results only after they have achieved some success. Funds that are losers right out of the gate may never be represented in the database. Furthermore, when funds start reporting, they have the option of 'backfilling' their data, or providing information on returns for previous months. If a fund was successful in preceding months, it has an incentive to backfill its data to increase its attractiveness to investors. This process creates a 'backfill bias,' because better results are overrepresented in the database. It is as if the Boston Red Sox waited until 2004 to report their World Series success, while the Yankees started in 1923; both franchises would look like smashing successes. By analyzing statistics from TASS Research, which is owned by Tremont Capital and has perhaps the most comprehensive data on returns, Mr. Malkiel and Mr. Saha have shown that the backfill bias is substantial. The returns that were backfilled for a given year were 5.8 percentage points higher than the returns of other funds whose results were contemporaneously reported for that year. 'I think there are a lot of people in the financial community who have a vested interest in showing only those pieces of data that help them sell products,' said Professor Malkiel, who is also a director for the Vanguard Group. Another problem he noted, called survivor bias, is a tendency for funds to stop reporting their monthly returns when they suffer losses and are on the verge of closing. Long-Term Capital Management, for example, did not report its losses to any of the database services from October 1997 to October 1998, a period when it lost 92 percent of its capital. (Long-Term Capital never reported to the TASS database.) Looking only at the past returns of hedge funds that are in existence today - that is, the surviving funds - it does appear as if hedge funds do produce generous returns. But this is tantamount to judging the success of a war by ignoring all the casualties. Mr. Malkiel and Mr. Saha have found that the funds that cease reporting their data, so-called dead funds, tend to have weak returns in the months before they cease reporting. The average annual return for dead funds was 7.4 percentage points less than that of surviving funds for the same years. And hedge funds have a tendency to die - more than 10 percent stop reporting to the database each year. Although it is possible that some of these funds withdrew because they were so successful that they no longer desired further investors, the researchers found that smaller and underperforming funds were the most likely to cease reporting - not a profile of successful funds that were turning away business. Using data from 1996 to 2003, Mr. Malkiel and Mr. Saha found that correcting for backfill and survivor biases reduced the average annual return on hedge funds, after deducting fees, from 13.5 percent to, at most, 9.7 percent, which is almost three percentage points less than the return on the Standard & Poor's 500-stock index for that time period. The lower return could be justified if hedge funds helped to diversify portfolios by providing an investment that did not move in lock step with other investments, and the researchers did find that hedge funds do not move closely with the stock market over time. Yet they also found that choosing a particular hedge fund entailed considerable risk because the funds exhibited enormous variability in performance in any given year. The best funds perform extraordinarily well, but the worst ones perform extremely poorly, with the spread between the best and worst greatly exceeding the spread between the best and worst equity or bond funds in a typical year. 'Clearly, there is a risk in investing in hedge funds that is far greater than the risk of investing in the other asset classes,' the researchers said. Even the so-called fund of funds hedge funds, which try to diversify risks by investing in other hedge funds, display nearly as much variability in performance across funds in a given year as is exhibited across the entire universe of mutual funds. Moreover, from 1995 to 2003, the average fund of funds yielded only a 7 percent annual rate of return after deducting fees, well below that of the average mutual fund. Picking a good fund is also dicey because there is little persistence in performance from one year to the next. The chance that a hedge fund that performed in the top half of the universe of funds in one year would do so again the following year is no better than 50-50, which raises the question of how the funds can command such high fees. Most hedge funds will be required to register and provide data to the Securities and Exchange Commission beginning in February 2006. While some people have argued that the S.E.C. already has too much to do, it would seem that collecting and disclosing information on performance is a small burden for the commission, and a great potential benefit to investors. 'As a free market person, I think markets work better when there is fuller and more accurate information,' Mr. Malkiel said. Alan B. Krueger is the Bendheim professor of economics and public affairs at Princeton University.

Subject: Vanguard Europe on Bear markets
From: johnny5
To: Terri
Date Posted: Wed, Mar 09, 2005 at 17:59:52 (EST)
Email Address: johnny5@yahoo.com

Message:
I want a fund that shorts the way hedge funds do with low fees - richie can get into this, poor johnny5 and terri are on the wrong side of the tracks - this is a disservice to our citizens and is just reaffirming the social gap of richie and poor. Vanguard has no bear funds, not by market, our country, or sector that I can find and this puts a severe limit on my diversification and increases my risk - mauldin makes this point clear in his paper. Buffet and Gates and Soros can run these sophisticated foreign asset positions and make a ton (100%) on a declining dollar but terri and johnny5 are supposed to be happy with 7% a year if that!! What crap - the rich get richer and grandma millie and grandpa war vet fight over the crumbs.

Subject: Re: Vanguard Europe on Bear markets
From: Institutional Investor
To: johnny5
Date Posted: Wed, Mar 09, 2005 at 21:59:40 (EST)
Email Address: Not Provided

Message:
No offense, but you have absolutely no idea what you are talking about Johnny. Almost anyone can enter apply the same strategies hedge funds use. If you don't believe me, read Gross's commentary below... There really isn't a reason to complain that there aren't any low cost bear funds, its called shorting ETFs. Johnny, instead of complaining about investing, you probably be well served to take at least an intro to investments class at your local university. It would probably clear up many of the misconceptions you seem to have. http://www.pimco.com/LeftNav/Late Breaking Commentary/IO/2004/IO_August_2004.htm Also, it might be worthwhile for you to investigate hedge funds a little more. Its not just 'richies' invested in them, look at any college endownment, public/taft-hartley pension plans, public foundations, you'll see a significant percentage in hedge funds and private equity. You can easily download financial statements from university websites if you really want to see how much they are invested. Allocations of 25-50% are quite common.

Subject: Re: Vanguard Europe on Bear markets
From: Setanta
To: Institutional Investor
Date Posted: Thurs, Mar 10, 2005 at 04:31:52 (EST)
Email Address: Not Provided

Message:
forgive my ignorance institutional investor. what is the definition of a hedge fund and how does it differ from an indexed fund or mutual fund. my experiance of hedges are that they are specific to a componant of risk. e.g. interest rate risk - interest rate swap from floating to fixed. currency risk - currency forward exchange contract. credit risk - credit default swaps etc. what does a hedge fund hedge against, surely not all componants of risk? or is it a fund on the hedge market i.e. a fund on a secondary market on currency, interest rate and credit swaps? in which case it is a fund on all the risk that institutional investors are not willing to accept. am i way off track here?

Subject: Re: Vanguard Europe on Bear markets
From: Institutional Investor
To: Setanta
Date Posted: Thurs, Mar 10, 2005 at 21:09:27 (EST)
Email Address: Not Provided

Message:
the term hedge fund is actually extremely generic. There is no one particular style for them. Typical strategies are covered in the links below, the most common being relative value (the typical long-short portfolio), convertible arbitrage, and event driven. http://www.magnum.com/hedgefunds/abouthedgefunds.asp#strategies http://www.hedgefund.com/abouthfs/strategysector/strategysector.htm

Subject: Re: Vanguard Europe on Bear markets
From: johnny5
To: Institutional Investor
Date Posted: Wed, Mar 09, 2005 at 22:59:27 (EST)
Email Address: johnny5@yahoo.com

Message:
No offense taken, I appreciate your comments II. I am trying to learn why I can't invest in a hedge fund but a man with 1 million can or these larger insitutions. I am not complaining about investing per se - but there are options that certain people have that me and terri do not because we are poor - the hedge fund investor does not have to short i-shares and do his own DD but can pay a professional to do so in a hedge fund - why do you think it is fair I cannot given mauldins comments to congress? He does not think it is fair. Perhaps I am tired of reading the markets 12 hours a day and want to pay a professional to do all the long and short sales for me - I could pay a guy in a hedge fund if I had 1 million right? But I don't have 1 million so I can't - I don't have time to talk to you or play golf with you - I have to do it all myself. Making money and investing is fine and doing all your own research and allocation and longs and short pleasure some people, but my uncle wants to pay someone else to do all the DD and market buys and sells, I think he would be best served if he could have someone go long and short - but if he gives the money to vanguard they only can invest for him in a very limited way - so why wouldn't he be better served with a hedge fund as many other people are who have more money? You find no ethical problem with this as Mauldin does II? It is OK for the rich man to give his money to a hedge fund manager and then live it up with all his free time but my poor old uncle should take time to learn about i-shares and how to use a computer so he can do all his own trades? Come on II - that is not fair - we are giving 2 people 2 different choices for no other reason than 1 has 1 million and 1 only has 250K - that has to sit wrong with you.

Subject: Re: Vanguard Europe on Bear markets
From: Institutional Investor
To: johnny5
Date Posted: Thurs, Mar 10, 2005 at 21:06:54 (EST)
Email Address: Not Provided

Message:
johnny, its called a market economy. I'd love to have a private jet, ten-million dollar house, etc, but I don't have the resources. I'm not going to be upset/bitter because someone else can afford these things. The reason you can't get into a hedge fund with a small amount of assets is a result of it not profitable for the firm, simple as that. Its not a matter of being exclusive, its a matter of being profitable. In regards to going long and short, a typical broker can do this using the futures market. I wouldn't recommend it, because I'm not a big fan of your typical broker, but it is available to the 'average' investor.

Subject: Re: Vanguard Europe on Bear markets
From: johnny5
To: Institutional Investor
Date Posted: Thurs, Mar 10, 2005 at 21:55:46 (EST)
Email Address: johnny5@yahoo.com

Message:
Thanks for the incite II, much appreciated. I would have less reservations if the fund told me no johhnny, you don't have the money, go away and tell your rich uncle to come here - but congress is telling the funds to tell me no currently, the funds are 100% free in their choice of who they can offer services too - its not a free market - the government is in the middle mucking it all up again. I hope congress will bring more regulation and transparancy but stop telling the hedge fund they can only talk to people with 1mil or more.

Subject: Bear Funds
From: Terri
To: All