Subject: Thoughts on Niger From: Mik To: All Date Posted: Wed, Aug 17, 2005 at 15:41:18 (EDT) Email Address: Not Provided Message: Emma, I don't know much about Niger as my expertise is in English and Portuguese speaking Africa. My first thought (which could be wrong) on the principle of 'Functioning Democracy' in Africa is unfortunately very cynical (here we go again - but I will end off with a positive example this time). Most 'democracies' in Africa are NOT true functioning democracies. Not even South Africa which saw open and fair elections with a change of president. Africa is (in general) still run by tribes. And people vote in their tribal leaders. For this reason, no matter how bad the leader may be, he will still be voted in because he represents the majority tribe. In Uganda we saw something interesting. The majority tribe is located in the North of the country and are Idi Amin supporters (that is how Idi Amin came to power in the first place). There are two more tribes in the South and the people in the south realised that by coming together they are a majority. So they vote for Museveni (who is the current president of Uganda). They will always vote for Museveni because he will represent their tribes (and they don't want to be ruled by any other tribal leader). Luckily a lot of these leaders are behaving themselves due to international pressure. But they slip up every so often as it appears in Niger. In South Africa, the majority tribe is the Xhosa and the most feared tribe is the Zulu. The Zulu tribe has their own political representation, but the remaining tribes vote along with the Xhosa tribe for the ANC. And we can be sure that the ANC will remain in power for as long as the population of Xhosas is the largest (which appears to be forever). We hope that with time and improved education, tribal links will diminish and more pure democracy will flourish. Now for the positive side: There is one country in Africa that is truly democratic. In fact it is the oldest democracy in Africa and actually the most succesful country in Africa.... Botswana. This country with a mere 1.4 million people has only one tribe. So competing politicians are evaluated on their political strength, not tribal relation. For a country that is almost entirely desert, has to import most of its water and import all its electricity, they are not only per capita the richest but the most progressive country in Africa. They are actually the true model for Africa's future. So when done properly, democracy works well.

Subject: Re: Thoughts on Niger From: Emma To: Mik Date Posted: Wed, Aug 17, 2005 at 15:43:21 (EDT) Email Address: Not Provided Message: An excellent response to articles on Niger. I am thinking and talking about the points your have made, and I did find the response this morning but it is always helpful to check for I might have missed. Excellent.

Subject: An Investor's Puzzle From: Terri To: All Date Posted: Wed, Aug 17, 2005 at 14:42:20 (EDT) Email Address: Not Provided Message: There is an investor's puzzle I am well aware of but sort of wish to wish away. Inflation leaving out energy is no problem, but with energy there is a problem. So too, corporate profits are fine including energy but not fine otherwise. If we have an economy driven by housing, we increasingly have an energy company driven stock market.

Subject: Philosopher of Optimism Endures From: Emma To: All Date Posted: Wed, Aug 17, 2005 at 12:41:41 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2005/08/17/books/17wils.html Philosopher of Optimism Endures Negative Deluge By BRAD SPURGEON GORRAN HAVEN, Britain - Any intellectual who divides opinion as much as Colin Wilson has for almost 50 years must be onto something, even if it is only whether humans should be pessimistic or optimistic. Mr. Wilson, who turned 74 in June and whose autobiography, 'Dreaming to Some Purpose,' recently appeared in paperback from Arrow, describes in the first chapter how he made his own choice. The son of working-class parents from Leicester - his father was in the boot and shoe trade - he was forced to quit school and go to work at 16, even though his ambition was to become 'Einstein's successor.' After a stint in a wool factory, he found a job as a laboratory assistant, but he was still in despair and decided to kill himself. On the verge of swallowing hydrocyanic acid, he had an insight: there were two Colin Wilsons, one an idiotic, self-pitying teenager and the other a thinking man, his real self. The idiot, he realized, would kill them both. 'In that moment,' he wrote, 'I glimpsed the marvelous, immense richness of reality, extending to distant horizons.' Achieving such moments of optimistic insight has been his goal and subject matter ever since, through more than 100 books, from his first success, 'The Outsider,' published in 1956, when he was declared a major existentialist thinker at 24, to the autobiography. In an interview last month at his home of nearly 50 years on the Cornish coast, Mr. Wilson was as optimistic as ever, even though his autobiography and his life's work have come under strong attack in some quarters. 'What I wanted to do was to try to create a philosophy upon a completely new foundation,' he said, sitting in his living room along with a parrot, two dogs and part of his collection of 30,000 books and as many records. 'Whereas in the past optimism had been regarded as rather shallow - because 'oh well, it's just your temperament, you happen to be just a cheerful sort of person' - what I wanted to do was to establish that in fact it is the pessimists who are allowing all kinds of errors to creep into their work.' He includes in that category writers like Hemingway and philosophers like Sartre. In books on sex, crime, psychology and the occult, and in more than a dozen novels, Mr. Wilson has explored how pessimism can rob ordinary people of their powers. 'If you asked me what is the basis of all my work,' he said, 'it's the feeling there's something basically wrong with human beings. Human beings are like grandfather clocks driven by watch springs. Our powers appear to be taken away from us by something.' The critics, particularly in Britain, have alternately called him a genius and a fool. His autobiography, published in hardcover last year, has received mixed reviews. Though lauded by some, the attacks on it and Mr. Wilson have been as virulent as those he provoked in the 1950's after he became a popular culture name with the publication of 'The Outsider.' That book dealt with alienation in thinkers, artists and men of action like T. E. Lawrence, van Gogh, Camus and Nietzsche, and caught the mood of the age. Critics, including Cyril Connolly and Philip Toynbee, hailed Mr. Wilson as a British version of the French existentialists. His fans ranged from Muammar el-Qaddafi to Groucho Marx, who asked his British publisher to send a copy of his own autobiography to three people in Britain: Winston Churchill, Somerset Maugham and Colin Wilson. 'The Outsider' was translated into dozens of languages and sold millions of copies. It has never been out of print. The Times of London called Mr. Wilson and John Osborne - another young working-class man, whose play 'Look Back in Anger' opened about the same time 'The Outsider' was published - 'angry young men.' That name was passed on to others of their generation, including Kingsley Amis, Alan Sillitoe and even Doris Lessing. But fame brought its own problems for Wilson. His sometimes tumultuous early personal life became fodder for gossip columnists. He was still married to his first wife while living with his future second wife, Joy. His publisher, Victor Gollancz, urged him to leave the spotlight, and he and Joy moved to Cornwall. But the publicity had done its damage. His second book, 'Religion and the Rebel,' was panned and his career looked dead. Mr. Wilson said the episode had actually saved him as a writer, however. 'Too much success gets you resting on your laurels and creates a kind of quicksand that you can't get out of,' he said. 'So I was relieved to get out of London.' He said his books were probably heading for condemnation in Britain anyway. 'I'm basically a writer of ideas, and the English aren't interested in ideas,' he said. 'The English, I'm afraid, are totally brainless. If you're a writer of ideas like Sartre or Foucault or Derrida, then the general French public know your name, whereas here in England, their equivalent in the world of philosophy wouldn't be known.' He never lost belief in the importance of his work in trying to find out how to harness human beings' full powers and wipe out gloom. 'Sartre's 'man is a useless passion,' and Camus's feeling that life is absurd, and so on, basically meant that philosophy itself had turned really pretty dark,' he said. 'I could see that there was a basic fallacy in Sartre and Camus and all of these existentialists, Heidegger and so on. The basic fallacy lay in their failure to understand the actual foundation of the problem.' That foundation, he said, is that human perception is intentional; the pessimists themselves paint their world black. Mr. Wilson has spent much of his life researching how to achieve those moments of well-being that bring insight, what the American psychologist Abraham Maslow called 'peak experiences.' Those moments can come only through effort, concentration or focus, and refusing to lose one's vital energies through pessimism. 'What it means basically is that you're able to focus until you suddenly experience that sense that everything is good,' Mr. Wilson said. 'We go around leaking energy in the same way that someone who has slashed their wrists would go around leaking blood. 'Once you can actually get over that and recognize that this is not necessary, suddenly you begin to see the possibility of achieving a state of mind, a kind of steady focus, which means that you see things as extremely good.' If harnessed by everyone, this could lead to the next step in human evolution, a kind of Superman. 'The problem with human beings so far is that they are met with so many setbacks that they are quite easily defeatable, particularly in the modern age when they've got too separated from their roots,' he said. Over the last year, he has been forced to test his own powers in this area. 'When I was pretty sure that the autobiography was going to be a great success, and when it, on the contrary, got viciously attacked,' Mr. Wilson said, 'well, I know I'm not wrong. Obviously the times are out of joint.' Though 'Dreaming to Some Purpose' was warmly received in The Independent on Sunday and The Spectator and was praised by the novelist Philip Pullman, the autobiography - and Mr. Wilson - received a barrage of negative profiles and reviews in The Sunday Times and The Observer. These made fun of the book's more eccentric parts, like his avowed fetish for women's panties. As a measure of the passions that Mr. Wilson provokes, Robert Meadley, an essayist, wrote 'The Odyssey of a Dogged Optimist' (Savoy, 2004), a 188-page book defending him. 'If you think a man's a fool and his books are a waste of time, how long does it take to say so?' Mr. Meadley wrote, questioning the space the newspapers gave to the attacks. Part of Mr. Meadley's conclusion is that the British intellectual establishment still felt threatened by Mr. Wilson, a self-educated outsider from the working class. 'One of my main problems as far as the public is concerned is that I've always been interested in too many things,' Mr. Wilson said, 'and if they can't typecast you as a writer on this or that, then I'm afraid you tend not to be understood at all.'

Subject: A new brand of populism in Germany From: Setanta To: All Date Posted: Wed, Aug 17, 2005 at 11:25:51 (EDT) Email Address: Not Provided Message: Dublin in the summer of 1905 felt like a very British city. Yes, you were in Ireland, but British rule in Ireland, and particularly Dublin, would have felt very secure. Had anyone suggested that, within little more than a decade, there would be a bloody rising, leading to a war of independence and culminating in the Free State, you would probably have laughed off their forecast as the deluded dream of extreme nationalists. In the summer of 2005, anyone suggesting that Europe in general, and Germany in particular, might revisit the path that led to the rise of Hitler, could be similarly dismissed. Yet, on closer inspection, remarkable trends have emerged in Europe over the past few months which indicate that populism could resurface quite easily. In France and the Netherlands, the No votes to the European constitution were a warning, but the recent political developments in Germany - where a populist protest party formed three weeks ago is registering 12 per cent at the polls - are much more telling. Germany votes on September 16.Until a few weeks ago, it was expected that this would result in either the centre-right or the centre-left winning, but from nowhere, a party with the loose description of Der Linkspar, or Left Party, has elbowed its way into the reckoning. The Linkspar is the brainchild of the former leader of the East German communist party, Gregor Gysi, and the former firebrand of the Social Democrat Party, Oskar Lafontaine. Both are eloquent orators and are using ordinary Germans' main fears - unemployment and foreigners - to galvanise voters. Neither man has a clear agenda, but their platform is a hodge-podge of issues designed to push plenty of old-fashioned populist buttons. All the usual suspects are in the mix, from the far-left favourite of higher taxes on business, to the far-right gem of blaming foreigners for stealing German jobs one day, to banning foreign speculators from taking over German companies the next. Last week, it was a defence of Iran's right to develop nuclear weapons against the US/Israeli alliance in the Middle East, and an adoption of the slogans of the anti-globalisation movements. Despite the strong impression that the Linkspartie is making it up as it goes along, Europe's most educated electorate is responding. Why? An unexpected place to start explaining why Germans would support a mix of protectionism at home and anti-Americanism abroad is China. China is changing the economic landscape for everyone, but it is threatening Germany more than any other country in Europe. The reason is that Germany is the world's pre-eminent exporter of manufactured goods. Despite years of high costs, Germany has managed to retain its dominance across a variety of areas. This means Germany has much to lose from China's emergence as the workshop of the world. But, unlike the US, which has an enormous trade and current account deficit that prompts regular China-bashing from political and corporate leaders, Germany's trade account is in enormous surplus, so the threat from China is not well signposted or understood. This opacity is the nub of Germany's problem, even though China's threat to Germany is being felt in the more politically sensitive arena of unemployment. In contrast, the US feels Chinese competition in the virtual world of current account deficits and currency fluctuations, which may send regular readers of the Financial Times into delirium, but does not determine elections. Unemployment, on the other hand – particularly if it stands at over five million voters as it does in Germany - affects the very soul of the nation. But why does China have a more significant impact on German unemployment than it does on American joblessness? And why does that lead to anti-American, rather than anti-Chinese political sentiment in Germany? This is the conundrum. German jobs do not necessarily get exported to China directly. The mechanism is more circuitous. Due to the opportunities that globalisation gives to transnational corporations, every time they make corporate decisions, they are factoring the cost in China into their calculations. It is impossible for any civilised society to compete with Chinese rates of pay that start at 50 cent an hour, so the German worker is priced out of the manufacturing market for new jobs. But those in existing jobs are protected by strong labour laws so, in the short term, it is those without jobs (the unemployed and young workers trying to come into the labour force for the first time) who suffer twice as much. The reason this same process has not led to a rise in American unemployment is that the US has replaced manufacturing jobs with service jobs, and its service economy is driven by its credit bubble, which has been fuelled, as in Ireland, by its housing boom. In Germany, there is no housing boom. In fact, house prices have hardly budged for ten years. Without a housing boom, you get no credit bubble; with no credit bubble, there is no consumer spending; without consumer spending, there are no service jobs; and with fewer jobs, a country will never have political consensus. So far, so explicable, but why has German political anger that results from the economic conundrum been directed at America, rather than China? There are many reasons for this. Possibly because China is remote, it is difficult to articulate what form anti-Chinese protests might take. Another possibility is that those who respond to the Linkspart's anti-American rhetoric can't actually see the full picture. It is also possible that anti-globalisation, because it is primarily a vehicle for anti-Americanism, offers a readymade cocktail of easily-recognised villains, which might be confused if the Chinese were thrown in. My own hunch is that being anti-American is simply easier. The leaders of the Linkspar are part of the long continental leftist tradition of anti-Americanism. Whatever the reasons, the Linkspar is tapping into German fears that the world is changing too rapidly and that this change is threatening their country. It is easy to see why the cosmopolitan elite of the political and corporate world does not fear this threat, for it is benefiting from it. But in Germany, France, Italy and Holland, the man on the street is worried. If your livelihood were to be outsourced to Beijing, wouldn't you feel the same way? The election in Germany should be examined closely to see what happens when a nation feels economically threatened. Not for the first time, Germany is being hypnotised by populists with listenable and potent rhetoric. http://www.davidmcwilliams.ie/Articles/view.asp?CategoryID=-1&CategoryName=&ArticleID=294

Subject: Re: A new brand of populism in Germany From: Terri To: Setanta Date Posted: Wed, Aug 17, 2005 at 11:55:08 (EDT) Email Address: Not Provided Message: Germany needs a housing boom! Now.

Subject: Re: A new brand of populism in Germany From: Terri To: Setanta Date Posted: Wed, Aug 17, 2005 at 11:53:14 (EDT) Email Address: Not Provided Message: The column seems extreme in pessimism. What do you make of the situation?

Subject: Ads Using the Everyday Woman From: Emma To: All Date Posted: Wed, Aug 17, 2005 at 11:07:30 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2005/08/17/business/media/17adco.html For Everyday Products, Ads Using the Everyday Woman By STUART ELLIOTT Madison Avenue is increasingly interested in using everyday women in advertising instead of just waifish supermodels. The change comes after the Dove line of personal-care products sold by Unilever introduced what it called a 'campaign for real beauty,' which presents women in advertisements as they are rather than as some believe they ought to be. If the fad becomes a trend and shows legs, so to speak, it has the potential to fundamentally change decades of image-making on Madison Avenue. But that is a big if indeed. There have been many previous instances of ads that showed so-called real women in place of professional models, which receded as the allure of glamour again reared its beautiful head. This week, Nike is introducing a humorous print and online campaign for exercise gear, frankly glorifying body parts that until now were almost never seen in ads, much less celebrated. One ad, which begins boldly, 'My butt is big,' features an oversize photograph of the derrière in question. Another Nike ad declares, 'I have thunder thighs,' while a third asserts: 'My shoulders aren't dainty or proportional to my hips. Some say they are like a man's. I say, leave men out of it.' The Nike ads, by Wieden & Kennedy in Portland, Ore., are arriving days after the Chicken of the Sea brand of tuna introduced a television commercial showing a gorgeous young woman being ogled by the men in her office. She can escape their wolfish ways only in the elevator, which she enters alone, then breathes a sigh of relief - revealing that she really has a more-than-ample stomach, which she had been holding in. The Nike campaign was in the works, executives say, well before the much-publicized arrival last month of Dove print and outdoor ads showing six women, none of them models, sizes 4 to 12, smiling in their underwear. (The first of the Dove 'real beauty' ads, showing older, wrinkled women, started appearing last fall.) The Chicken of the Sea commercial is adapted from a spot that its parent, Thai Union Frozen Products, began running in Asia in 2001. Even so, the arrival of all the ads at the same time suggests that change may be in the air. 'We've gotten tired of airbrushed pictures none of us can relate to or recognize,' said Linda Kaplan Thaler, one of the most prominent women in advertising, whose agency, the Kaplan Thaler Group in New York, was not involved in creating any of the campaigns. Advertisers are 'loosening the reins,' said Ms. Kaplan Thaler, who is chief executive and chief creative officer at her agency, which is owned by the Publicis Groupe, in recognition of the reality that 'women are the majority of consumers and are buying most of the products.' But those facts have been evident for years. Why the new style of ads now? One reason, said Nathan Coyle, senior strategist at Brain Reserve in New York, a consulting company, is the advent of reality television. 'Your neighbors, everyday people, are the new celebrities,' Mr. Coyle said, which feeds the desire for marketers 'to shift from depicting women who are unattainable to women who are attainable.' Kelly Simmons, president of a brand consulting company in Philadelphia named Bubble, offered another reason: the aging of the baby-boom generation - the 76 million Americans born from 1946 to 1964 - who have long set the pace for marketers and advertising agencies. The first baby boomers will start turning 60 on Jan. 1. 'There's no question baby boomers feel better about their bodies,' Ms. Simmons said, 'and are determined to age beautifully,' adding, 'It feels there are real voices of women coming through' in the Dove and Nike ads. 'I applaud the trend.' Nancy Monsarrat, United States director for advertising at Nike in Beaverton, Ore., said that in addition to the different attitudes about body image among boomer women, 'younger women have a different perspective' from that of their counterparts a decade or two ago. 'They're more personally independent about who they can and should be,' Ms. Monsarrat said, which is also reflected in the campaign's approach. 'One of the things we've noticed is if you go to an exercise class, if you go to a marathon, active women come in a lot of shapes and sizes,' she added. 'This can be a great celebration of that.' Fitness and health are also the focus of the Chicken of the Sea commercial, said John Signorino, the company's president and chief executive, in San Diego. He imported the spot to the United States after consumers - including, he said, his wife - received overseas versions of it from friends by e-mail. 'It's an effort to show consumers, in an attention-getting way, that tuna, and Chicken of the Sea, fit into a healthy lifestyle,' Mr. Signorino said. The commercial is being shown, or soon will be, on networks like ABC, CBS, HGTV and Oxygen, he added, and will be circulated through e-mail. The spot is adapted from the original version created by an agency in Bangkok named Chaiyo. Ms. Monsarrat said the Nike campaign, which is also scheduled to appear on a Web site (www.nikewomen.com), is in keeping with her company's efforts, dating back more than a decade, to address issues about women's self-images in a positive way, without stereotypes. She cited campaigns that carried themes like 'This is not a goddess' and 'If you let me play,' all of which were intended, she said, to be 'honest in how we communicate with our target consumer.' Nike was not alone in the 1990's in running ads meant to question the conventional wisdom about images of women in advertising. In 1997, the Body Shop gained international attention for a campaign carrying the theme 'Love your body,' which featured a Rubenesque plastic doll named Ruby. The print ads and posters showed the voluptuous, even zaftig, Ruby reclining on a sofa under this headline: 'There are 3 billion women who don't look like supermodels and only 8 who do.' And since 1997, the Advertising Women of New York club has presented awards to campaigns that its members deem to be breaking ground by portraying women in realistic, nonstereotypical ways. In addition to Nike, winners of such awards have included Adidas, Avon, Gatorade, John Hancock and Reebok. The waxing and waning of so-called real women in advertising comes as marketers and agencies embrace the idea, then revert to traditional images when they believe it is time for a new direction as consumers lose interest. 'Advertising sometimes starts trends and sometimes it follows trends,' Ms. Kaplan Thaler said. Even if they do not turn up in ads, 'real women have always been here, are here and continue to be here,' she added. 'I'm always happy to see advertising that does not dictate a norm none of us can achieve.' Still, said Ms. Simmons of Bubble, who studies sex issues in marketing, more remains to be done before the stereotypes are banished. 'The emphasis is still on women's bodies' in the new ads, Ms. Simmons said. 'It's not like we're looking at their irises.'

Subject: Bonds From: Terri To: All Date Posted: Wed, Aug 17, 2005 at 10:33:40 (EDT) Email Address: Not Provided Message: Notice that amazingly the long term Treasury bond is below 4.25% in yield again. There is a steady demand for long term bonds, as though inflation is simply not going to be a concern. This has to be a sign investors are confident the Federal Reserve is well ahead of any price problem that might arise.

Subject: Re: Bonds From: David E.. To: Terri Date Posted: Wed, Aug 17, 2005 at 12:31:06 (EDT) Email Address: Not Provided Message: -Another possible viewpoint on why 10 year bonds are priced so low - The steady stream of demand for bonds mostly comes from China and Japan. Whose demand is driven by the need to keep the yen and the remimbi priced low. It has been suggested that the Chinese will do everything in their power to keep the remimbi priced low until the Chinese 2008 Olympics are over. When trouble strikes it will come quickly. Keep your powder dry and diversify to protect against both the possibilities of inflation or deflation.

Subject: Re: Bonds From: Emma To: David E.. Date Posted: Wed, Aug 17, 2005 at 12:44:17 (EDT) Email Address: Not Provided Message: This is an apt comment; agreed. There are 2 more articles on the danger of the housing bubble in the Wall Street Journal today. Paul Krugman is not alone in worrying.

Subject: Re: Bonds From: Terri To: Emma Date Posted: Wed, Aug 17, 2005 at 13:16:19 (EDT) Email Address: Not Provided Message: David, I too think there will be little movement in the value of the Yuan till at least the Olympics. Whether the dollar can hold against other currencies till then is not clear however, nor is it clear bonds can hold. I just do not have a sense of this, so I think value value value with every purchase.

Subject: Dear Bobby From: Emma To: All Date Posted: Wed, Aug 17, 2005 at 10:22:46 (EDT) Email Address: Not Provided Message: Dear Bobby, Please save a set of posts if possible when you store part of the message board. Thanks lots :)

Subject: When Doctors Advise Investors From: Emma To: All Date Posted: Wed, Aug 17, 2005 at 09:56:50 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2005/08/17/opinion/17wed2.html When Doctors Advise Investors It's getting harder and harder to disentangle the medical profession from financial conflicts of interest. The familiar concern has involved doctors who take money from pharmaceutical or biotechnology companies for consulting or research. Such ties inevitably call into question how objective such doctors can be in conducting research, offering advice to government agencies or prescribing drugs for patients. It is never wholly clear whether the doctor is focused on the medical needs of patients or has one eye on the prospects of a financial patron. Now, as described yesterday in an article by Stephanie Saul and Jenny Anderson in The Times, there is an additional concern: doctors who are paid to give advice to investment firms. The worry here is not that doctors will somehow shortchange their patients, but that their advice to financial firms may distort the markets, offering sophisticated investors the kind of insider information that the ordinary investor can't get. With little notice or alarm, this form of financial consulting has expanded rapidly. An article on June 1 in The Journal of the American Medical Association concluded that almost 10 percent of the nation's 700,000 doctors had entered into formal consulting relations with the investment industry. The percentage of doctors from academic medical centers, where much of the clinical research of interest to investors takes place, was thought to be considerably higher. The financial firms seeking advice include hedge funds, venture capital firms, investment bankers and stockbrokers, among others. They are assisted by specialized companies that enroll doctors and link them with information-hungry financial firms. A doctor is typically paid on an hourly basis - at rates ranging from $200 to more than $1,000 per hour - for consulting that can be done by telephone or face to face. This kind of consulting looks like a recipe for trouble. The information most prized by investors is some hint as to how an experimental drug is performing in ongoing clinical trials or informed guidance about problems that may trouble the Food and Drug Administration. Although the doctors are routinely warned not to reveal confidential or proprietary information, it is a virtual certainty that when the scope of consulting is so large, there will be disclosures, even if they are inadvertent. The best antidote would be a pledge of abstinence backed by the ethical guidelines of medical societies. Any doctor who has inside information about clinical trials or the F.D.A.'s thinking should not do consulting work for investment firms.

Subject: Doctors' Links With Investor Matchmakers From: Emma To: All Date Posted: Wed, Aug 17, 2005 at 09:56:01 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2005/08/16/business/16research.html?ex=1281844800&en=93361cff80b4cbe8&ei=5090&partner=rssuserland&emc=rss Doctors' Links With Investor Matchmakers Raise Concerns By STEPHANIE SAUL and JENNY ANDERSON At first, the calls seemed innocuous. Investment companies were offering Dr. Ronald B. Natale $200 or $300 for 15 minutes, asking that he discuss general trends in lung cancer, sometimes over the telephone. But Dr. Natale became suspicious as the money offers kept growing, just before he was to present the case for Iressa, a new lung cancer drug, to a Food and Drug Administration advisory panel in September 2002. Dr. Natale's access to research data on Iressa made him an attractive source for investment researchers seeking inside information. 'Wow, they were offering $1,000, $1,500, for 30 minutes of my time,' said Dr. Natale, a prominent researcher at Cedars-Sinai Comprehensive Cancer Center in Los Angeles. He said he routinely turned down offers to speak to investors. While Dr. Natale has qualms, other doctors apparently do not. Nearly 10 percent of the nation's 700,000 doctors have signed up as consultants with a new segment of the investment industry - companies that act as the Match.com of the investment world, according to an article in The Journal of the American Medical Association. For a fee, they arrange conversations between investors and leading professionals, experts or even employees of major companies. Matching investors with doctors can raise particularly troubling questions. Physicians frequently serve as clinical researchers for the pharmaceutical and biotechnology industries, testing new drugs. Inside knowledge about those tests, before it is publicly available, could be worth millions. The Securities and Exchange Commission has now begun looking at whether doctors, participating in clinical trials, are accepting money to talk to analysts and investors about the confidential results. Such a breach, under some circumstances, could be construed as a violation of insider trading law. Among the businesses that have emerged as matchmakers is Gerson Lehrman Group of New York. Founded in 1998, Gerson is the industry leader in connecting investors with specialists in fields ranging from Turkish cement to underwire brassieres. Gerson's 150,000 specialists include 60,000 physicians. Another company, Leerink Swann & Company of Boston, has a subsidiary that advertises a network of more than 11,500 medical professionals, including physicians, willing to talk to investors. The idea is fairly new, but the business model has already come under scrutiny. Even though the companies prohibit panelists from violating confidences or revealing proprietary information, such conversations carry the risk that participants will betray secrets. 'The frequency of physician contact, this matrix or extraordinary network of physicians that were at the disposal of investment firms, is a setup for trouble,' said Dr. Eric J. Topol of the Cleveland Clinic, who co-wrote the JAMA article, which appeared in June, exploring the growing relationships between physicians and investment companies. Dr. Topol has firsthand knowledge of the problem. Last year, he gave up his own $12,000-a-year position on a hedge fund advisory panel after concluding it created the appearance of impropriety. Dr. Topol was stung by implications that his expertise helped the fund short Merck before the company's decision to withdraw Vioxx last September. But Dr. Topol had written about the cardiovascular problems associated with Vioxx and similar cox-2 painkillers well before he joined the hedge fund in 2003. Dr. Topol, the Cleveland Clinic's chief of cardiology, also ended his relationship with several companies in the health care and pharmaceutical businesses. 'If you weigh the liabilities and the jeopardy against the limited upside, it does not come out in favor of these relationships,' said Dr. Topol, whose article cited various ways doctors earned money as consultants and advisers to industry. Investment houses and research analysts often sponsor dinners where paid panels of physicians give their thoughts about pharmaceutical developments. Investment analysts attend medical society meetings, where they mingle with practicing physicians. Hedge funds hire physicians to sit on advisory panels. 'We do this all the time,' said Jami Rubin, a pharmaceutical industry analyst with Morgan Stanley, who said her company frequently relied on physicians for advice. 'We pay them for their time. Sometimes they do conference calls. Sometimes they prepare slide shows.' Ms. Rubin said she used doctors as educators to 'explain how drugs work, their mechanism of action, potential shortfalls, positives, negatives, speculation on the issues that the F.D.A. might have.' 'I don't think there's any issue about that whatsoever,' she said. Concerns about whether investment companies could get inside word about clinical research has prompted some precautions. The F.D.A., which regulates clinical trials, does not have authority over investment transactions. But last year the agency took steps to increase information-sharing with the S.E.C. In a statement last week, the F.D.A. said that any activity that raised questions about the integrity of clinical research could render the results useless for supporting new drug applications. A recent article in The Seattle Times indicated that it had found 26 instances in which doctors had given up confidential information to analysts. Several medical societies have taken steps to protect scientific papers submitted by their members. The American Society of Clinical Oncologists, for example, gives its members advance copies of research papers presented at its meetings; the copies are covered in shrink-wrap and accompanied by a warning that they are only for educational use. Members are barred from trading on information in the abstracts until after it is publicly available. The Biotechnology Industry Organization, which includes companies whose fate can turn on one clinical trial, is reviewing whether additional regulation is necessary. 'Ultimately our companies are the most likely to be victimized by this kind of conduct,' said the association's chief executive, Jim Greenwood. Mr. Greenwood said that one of the organization's member companies, Isis Pharmaceuticals, complained three years ago to UBS. That was after a UBS analyst issued a report contending that a lung cancer drug had failed a Phase 3 clinical trial, citing 'recent conversations with investigators involved in the trial.' Shares of Isis tumbled 20 percent the day of the report. A UBS spokesman, Mark Hengel, declined to comment on whether doctors involved in the trial were surveyed, but said: 'UBS research notes are highly regarded. The information is sourced and broadly disseminated to our client base.' Some firms like Gerson Lehrman do not supply investment advice, but simply serve as a go-between. Gerson Lehrman was started by Mark Gerson, a Yale Law School graduate and a former teacher, and Thomas Lehrman, to publish books about major changes in industries. The business evolved when hedge fund managers said they did not have the time to read books but preferred access to the list of experts the authors had used. So now the business works like this: hedge funds or mutual funds pay Gerson Lehrman an annual subscription fee, in the range of $120,000 a year, per sector. Gerson pays its specialists at a rate set by the specialist. Portfolio mangers, for example, submit to Gerson a project they are working on and Gerson scours its database for the best specialists, then contacts them to check their availability and ability to participate. Each is sent a disclosure form requiring them not to disclose material nonpublic information, trade secrets or breach any previously confidentiality agreements. Gerson Lehrman and Leerink Swann declined to comment for this article. But a letter from Mark Gerson, chief executive of Gerson Lehrman, said: 'Before participating in our network, all physicians and scientists sign a contract that explicitly states they must not violate any of their confidentiality agreements, must check if they are unsure what those confidentiality obligations are and will be paid for time allocated to a project if they must discontinue it out of any related concerns.' Last week, according to people close to the company, Gerson Lehrman started to offer compliance officers from hedge funds and mutual funds the ability to submit a 'blacklist' of ticker symbols of companies owned by the fund. That way, if a fund owns a particular company's stock, Gerson can block the fund's analysts from requesting experts linked to that company. According to Dr. Topol, Gerson Lehrman has built its network over the Internet, sending out e-mail messages to large physician groups, hoping they will enroll. 'Most physicians have been targets of e-mails,' he said. One member of Gerson Lehrman's physician panel, Dr. Eric Scott Sills of Atlanta, said he had participated in telephone conferences for Gerson Lehrman five or six times in the last 18 months. Dr. Sills, an infertility specialist who also conducts clinical research, said he was never told exactly what company the callers were representing. 'They've never asked about present research projects going on at our center in Atlanta and never asked me to share preliminary data sets with them,' he said. Dr. Natale of Cedars-Sinai said that as a clinical researcher he was uncomfortable with taking fees to consult for the investment community. 'I really don't want to have to think about whether it's ethical or unethical, what information I cannot share, what's confidential and what's not confidential,' he said, explaining why he turns down such offers. Clinical trials of drugs are usually double-blind, meaning that neither the physicians nor the patients know which patients are getting the experimental drug and which are receiving sugar pills. Large trials often have many sites with small numbers of patients. 'It's not common for one investigator to have the full picture,' said Dr. Elliott Sigal, director of global research for Bristol-Myers Squibb. Some are concerned, however, that important information could unintentionally slip out. 'Obviously, they're not trying to get any physician to provide inside information,' Dr. Topol said of companies like Gerson Lehrman. 'But invariably, even without awareness and even without intent, that can happen.' And the appearance of impropriety by itself is a problem, said Dr. Catherine De Angelis, the editor of The Journal of the American Medical Association. The advice Dr. De Angelis said she gave Dr. Topol last year could apply more broadly. 'Whatever you're making from just being a consultant, just give it up,' she said. 'It's not worth our integrity. Even though you know you're not doing anything wrong. It's the perception.'

Subject: Donald Luskin Krugman truth squad From: Jon Wesley To: All Date Posted: Tues, Aug 16, 2005 at 15:44:46 (EDT) Email Address: familyguyantiflag@yahoo.com Message: I don't know if this has been brought up before, because I am new here, but can anyone give me information on whether this guy from the National Review Online is actually factual in his so called 'debunking' of Paul Krugman's work? I have read examples of his stuff, and some of it is BS but is there any info that anyone else can give me? Thanks very much.

Subject: Re: Donald Luskin Krugman truth squad From: Jennifer To: Jon Wesley Date Posted: Wed, Aug 17, 2005 at 10:41:38 (EDT) Email Address: Not Provided Message: These sources are never worth a glance.

Subject: Gene-Altered Rice and the Farm Belt From: Emma To: All Date Posted: Tues, Aug 16, 2005 at 15:18:10 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2005/08/16/business/16biorice.html Can Gene-Altered Rice Rescue the Farm Belt? By ALEXEI BARRIONUEVO WATSON, Mo. - Like an expectant father, Jason Garst stood in calf-deep water and studied the three-foot-high rice plants growing in a flooded field here. It was a curious sight in northwest Missouri, where the growing season is considered to be too short for rice. Mr. Garst, a sixth-generation farmer, is hoping at least one of the 12 varieties on his test plot will sprout this fall. If one does, he will start growing rice plants that have been genetically engineered to produce proteins found in human milk, saliva and tears. Once converted into a powder form, those proteins would be used in granola bars and drinks to help infants in developing countries avoid death from diarrhea. 'I know in my heart that this will be better than anything else we are doing,' said Mr. Garst, 35, who also farms soybeans and potatoes. The rice project is backed by a private company called Ventria Bioscience but also has the support of the state and a local university, which are hoping to reverse the long decline in the area's farm economy. But the project has run into opposition from environmental groups and even the beer giant Anheuser-Busch amid fears about the health effects of genetically engineered crops, making Mr. Garst's little rice paddy a piece of a larger battlefield. The economic and academic ambitions of the Missouri project make it unique, but the arguments echo those heard in similar disputes in Europe and, increasingly, in the United States. Critics of Ventria's plans are concerned that the gene-altered rice could contaminate regular rice crops and pose a health risk to consumers, scaring off buyers. Ventria and its academic partner in the project, Northwest Missouri State University, say they can control the potential for contamination. And they say the risks are minimal when balanced against the potential for the special rice to help cut the costs of drugs and save lives. The debate has a certain urgency in the Farm Belt because it highlights the challenge facing much of the region's economy: finding new products that will reduce farmers' reliance on commodity crops. As equipment has become more efficient and foreign competition has stiffened, farms have consolidated and profit margins have shrunk, forcing farmers to plant ever more acres to squeeze out a living. The genetic engineering work that Ventria and other companies are doing can add value to products like rice, offering farmers a more stable income that does not rely on steep government subsidies. 'There is no question that this represents a chance to transform the economy of the region,' said Mark Drabenstott, director of the Center for the Study of Rural America at the Federal Reserve Bank of Kansas City. 'For regions like northwest Missouri, there is not a long list of economic alternatives.' Despite opposition, Ventria's plans to grow genetically engineered rice - eventually to commercial scale - are going forward. The company began growing rice in North Carolina this summer after getting approval from the Agriculture Department. Once Ventria decides where it will grow rice in Missouri, it will have to apply for a permit from the department, a process expected to take two to three months. Dean L. Hubbard, president of Northwest Missouri State, persuaded Ventria last year to move its operations from Sacramento to new buildings planned for the Northwest campus in Maryville, about 90 miles north of Kansas City. Seeking a way to reverse the area's slide in population, Dr. Hubbard teamed up with Melvin D. Booth, a Northwest Missouri alumnus who previously ran two large biotechnology companies. The two approached Ventria about making it part of the university's plan to form joint ventures with young biopharmaceutical companies. Ventria was already considering similar offers from universities in Georgia, Louisiana and North Carolina, but Scott E. Deeter, Ventria's chief executive, agreed to visit the university last August. Mr. Deeter said that on the ride from the Kansas City airport, he was intrigued when Dr. Hubbard described the university's program to heat and cool the campus using bio-fuel derived from paper and wood chips. At the meeting, Mr. Garst presented him with a research paper he had prepared on what it would take to grow rice in northern Missouri. 'It was very impressive,' said Ning Huang, Ventria's vice president for research and development, who was there. Finally it came down to whether Ventria scientists would agree to move to Maryville, population 10,000, from California. Next year 13 will move, including Dr. Huang. Under the agreement reached last November, Ventria will pay farmers more than double what they make on their most profitable crop, and pay Northwest Missouri $500 an acre for crops grown on university land. The university is spending about $10 million to help build a production and teaching complex, and the state is kicking in another $10 million. Atchison County, Mo., where Mr. Garst's farmland is, has lost more than 1,000 people, or 14 percent of its population, since 1990. The town of Watson, once a thriving rural hub with three grocery stores and an opera house, has just over 100 people and no place to buy a soda. Most buildings have been boarded up. 'To reverse the population slide, you have to make it profitable to farm,' Dr. Hubbard said. 'My dream is that 10 years from now, this rural economy has been transformed, that it is vibrant again and people are renovating their downtowns.' The fate of Mr. Garst's experimental rice plot has loomed larger since Ventria encountered resistance to planting its rice in the southern part of the state, where rice has traditionally been grown. When the company was considering Missouri as a place to grow its rice, it talked to Anheuser-Busch, which uses Missouri rice in its beer. Mr. Deeter said Anheuser-Busch initially did not raise any opposition to the project. But when Ventria tried to plant rice in southern Missouri this spring, the beer maker threatened not to buy any rice grown in the state. The company feared a consumer backlash if people thought gene-altered rice could end up in their bottles of Bud. For Missouri's farm economy, the risk of growing pharmaceutical rice is high. More than half of Missouri's rice is sent abroad, to the European Union and Caribbean countries that are especially sensitive about genetically modified products. 'We are still having to make statements to our customers that the rice we export is not genetically modified,' said Carl Brothers, the vice president for marketing at Riceland Foods, which markets more than half of Missouri's rice. 'We are concerned longer term that if Ventria and others get involved that will get harder to say.' The two companies reached a truce in April: Ventria agreed not to grow genetically modified rice within 120 miles of commercial rice crops. 'We can continue to purchase rice grown and processed in Missouri as long as Ventria's growing areas remain sufficiently far from commercial rice production,' said Francine Katz, a spokeswoman for Anheuser-Busch. That deal suddenly made four test plots in the northern part of the state, including Mr. Garst's, all the more important, since Ventria's agreement with Northwest Missouri State calls for the company to grow 70 percent of its rice in the state. To prove to its customers that it would have a diverse supply base, Ventria must grow in at least one other location in North America, and is also searching for a growing area in the Southern Hemisphere to be able to produce year-round. In June, Ventria planted 70 acres of genetically modified rice in North Carolina. There, environmentalists continue to attack the company, saying the rice poses a threat to other crops and the human food chain. Ventria's rice fields are just a few miles from a rice-seed-screening research center and are also close to two wildlife refuges with large populations of migrant birds and swans that environmentalists contend could transport Ventria's rice seeds into wild areas. Storms and floods, environmentalists say, could also lead to rice contamination. 'Just washing away in a big rain- storm is enough,' said Margaret Mellon, director of the food and environment program at the Union of Concerned Scientists in Washington. Scientists at Ventria, which is yet to make any money from its bio-rice, say rice is among the safest crops for genetic engineering. Rice stalks pollinate themselves, so the altered genes, which are synthetic versions of human genes, cannot be easily transferred to plants in other fields. And Ventria requires farmers to employ a 'closed system,' using dedicated equipment and a production process where the seed is ground into a powder before it leaves the farm. But critics say that there is no way to guarantee that the farmers will follow all the government regulations and Ventria's rules, and that they are worried about the risk of contamination because it would be hard to detect. 'We simply wouldn't know if a contamination event took place,' said Craig Culp, a spokesman for the Center for Food Safety, in Washington. Dr. Hubbard acknowledged that there are risks, but he said he believed that they were minimal. Federal regulations have been tested before, most notably in 2002, when drug-producing corn made by ProdiGene began sprouting in soybean fields near its Iowa and Nebraska sites. The Agriculture Department seized 500,000 bushels of soybeans and assessed the company nearly $3 million in fines and disposal costs. Earlier, in 2000, a gene-altered variety of corn that was approved for animal feed but not for human consumption was found in taco shells and other grocery items, prompting recalls. Mr. Garst is a modern breed of farmer with a master's degree and a healthy interest in science. And he himself has done whatever he can to wring more from his commodity crops, even trying out a $300,000 tractor that steers automatically using a global-positioning satellite to till straighter rows. 'Obviously, you will not see pharmaceutical crops from here to Kansas City,' he said of Ventria's project. 'But there will be pockets in this area where you will see development. If you keep two more farmers in this area it is huge - there are four of us now.'

Subject: One Hundred Years of Uncertainty From: Emma To: All Date Posted: Tues, Aug 16, 2005 at 14:32:51 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2005/04/08/opinion/08greene.html?ex=1270612800&en=c87d6bab356df279&ei=5090&partner=rssuserland One Hundred Years of Uncertainty By BRIAN GREENE JUST about a hundred years ago, Albert Einstein began writing a paper that secured his place in the pantheon of humankind's greatest thinkers. With his discovery of special relativity, Einstein upended the familiar, thousands-year-old conception of space and time. To be sure, even a century later, not everyone has fully embraced Einstein's discovery. Nevertheless, say 'Einstein' and most everyone thinks 'relativity.' What is less widely appreciated, however, is that physicists call 1905 Einstein's 'miracle year' not because of the discovery of relativity alone, but because in that year Einstein achieved the unimaginable, writing four papers that each resulted in deep and formative changes to our understanding of the universe. One of these papers - not on relativity - garnered him the 1921 Nobel Prize in physics. It also began a transformation in physics that Einstein found so disquieting that he spent the last 30 years of his life in a determined effort to repudiate it. Two of the four 1905 papers were indeed on relativity. The first, completed in June, laid out the foundations of his new view of space and time, showing that distances and durations are not absolute, as everyone since Newton had thought, but instead are affected by one's motion. Clocks moving relative to one another tick off time at different rates; yardsticks moving relative to one another measure different lengths. You don't perceive this because the speeds of everyday life are too slow for the effects to be noticeable. If you could move near the speed of light, the effects would be obvious. The second relativity paper, completed in September, is a three-page addendum to the first, which derived his most famous result, E = mc2, an equation as short as it is powerful. It told the world that matter can be converted into energy - and a lot of it - since the speed of light squared (c2) is a huge number. We've witnessed this equation's consequences in the devastating might of nuclear weapons and the tantalizing promise of nuclear energy. The third paper, completed in May, conclusively established the existence of atoms - an idea discussed in various forms for millenniums - by showing that the numerous microscopic collisions they'd generate would account for the observed, though previously unexplained, jittery motion of impurities suspended in liquids. With these three papers, our view of space, time and matter was permanently changed. Yet, it is the remaining 1905 paper, written in March, whose legacy is arguably the most profound. In this work, Einstein went against the grain of conventional wisdom and argued that light, at its most elementary level, is not a wave, as everyone had thought, but actually a stream of tiny packets or bundles of energy that have since come to be known as photons. This might sound like a largely technical advance, updating one description of light to another. But through subsequent research that amplified and extended Einstein's argument (see Figures 1 through 3), scientists revealed a mathematically precise and thoroughly startling picture of reality called quantum mechanics. Before the discovery of quantum mechanics, the framework of physics was this: If you tell me how things are now, I can then use the laws of physics to calculate, and hence predict, how things will be later. You tell me the velocity of a baseball as it leaves Derek Jeter's bat, and I can use the laws of physics to calculate where it will land a handful of seconds later. You tell me the height of a building from which a flowerpot has fallen, and I can use the laws of physics to calculate the speed of impact when it hits the ground. You tell me the positions of the Earth and the Moon, and I can use the laws of physics to calculate the date of the first solar eclipse in the 25th century. What's important is that in these and all other examples, the accuracy of my predictions depends solely on the accuracy of the information you give me. Even laws that differ substantially in detail - from the classical laws of Newton to the relativistic laws of Einstein - fit squarely within this framework. Quantum mechanics does not merely challenge the previous laws of physics. Quantum mechanics challenges this centuries-old framework of physics itself. According to quantum mechanics, physics cannot make definite predictions. Instead, even if you give me the most precise description possible of how things are now, we learn from quantum mechanics that the most physics can do is predict the probability that things will turn out one way, or another, or another way still. The reason we have for so long been unaware that the universe evolves probabilistically is that for the relatively large, everyday objects we typically encounter - baseballs, flowerpots, the Moon - quantum mechanics shows that the probabilities become highly skewed, hugely favoring one outcome and effectively suppressing all others. A typical quantum calculation reveals that if you tell me the velocity of something as large as a baseball, there is more than a 99.99999999999999 (or so) percent likelihood that it will land at the location I can figure out using the laws of Newton or, for even better accuracy, the laws of Einstein. With such a skewed probability, the quantum reasoning goes, we have long overlooked the tiny chance that the baseball can (and, on extraordinarily rare occasions, will) land somewhere completely different. When it comes to small objects like molecules, atoms and subatomic particles, though, the quantum probabilities are typically not skewed. For the motion of an electron zipping around the nucleus of an atom, for example, a quantum calculation lays out odds that are all roughly comparable that the electron will be in a variety of different locations - a 13 percent chance, say, that the electron will be here, a 19 percent chance that it will be there, an 11 percent chance that it will be in a third place, and so on. Crucially, these predictions can be tested. Take an enormous sample of identically prepared atoms, measure the electron's position in each, and tally up the number of times you find the electron at one location or another. According to the pre-quantum framework, identical starting conditions should yield identical outcomes; we should find the electron to be at the same place in each measurement. But if quantum mechanics is right, in 13 percent of our measurements we should find the electron here, in 19 percent we should find it there, in 11 percent we should find it in that third place. And, to fantastic precision, we do. Faced with a mountain of supporting data, Einstein couldn't argue with the success of quantum mechanics. But to him, even though his own Nobel Prize-winning work was a catalyst for the quantum revolution, the theory was anathema. Commentators over the decades have focused on Einstein's refusal to accept the probabilistic framework of quantum mechanics, a position summarized in his frequent comment that 'God does not play dice with the universe.' Einstein, radical thinker that he was, still believed in the sanctity of a universe that evolved in a fully definite, fully predictable manner. If, as quantum mechanics asserted, the best you can ever do is predict probabilities, Einstein countered that he'd 'rather be a cobbler, or even an employee in a gaming house, than a physicist.' This emphasis, however, partly obscures a larger point. It wasn't the mere reliance on probabilistic predictions that so troubled Einstein. Unlike many of his colleagues, Einstein believed that a fundamental physical theory was much more than the sum total of its predictions - it was a mathematical reflection of an underlying reality. And the reality entailed by quantum mechanics was a reality Einstein couldn't accept. An example: Imagine you shoot an electron from here and a few seconds later it's detected by your equipment over there. What path did the electron follow during the passage from you to the detector? The answer according to quantum mechanics? There is no answer. The very idea that an electron, or a photon, or any other particle, travels along a single, definite trajectory from here to there is a quaint version of reality that quantum mechanics declares outmoded. Instead, the proponents of quantum theory claimed, reality consists of a haze of all possibilities - all trajectories - mutually commingling and simultaneously unfolding. And why don't we see this? According to the quantum doctrine, when we make a measurement or perform an observation, we force the myriad possibilities to ante up, snap out of the haze and settle on a single outcome. But between observations - when we are not looking - reality consists entirely of jostling possibilities. Quantum reality, in other words, remains ambiguous until measured. The reality of common perception is thus merely a definitive-looking veneer obscuring the internal workings of a highly uncertain cosmos. Which is where Einstein drew a line in the sand. A universe of this sort offended him; he could not accept, as he put it, that 'the Old One' would so profoundly incorporate a hidden element of happenstance in the nature of reality. Einstein quipped to his quantum colleagues, 'Do you really think the Moon is not there when you're not looking?' and set himself the Herculean task of reworking the laws of physics to resurrect conventional reality. Einstein waged a two-front assault on the problem. He sought an internal chink in the quantum framework that would establish it as a mere steppingstone on the path to a deeper and more complete description of the universe. At the same time, he sought a grander synthesis of nature's laws - what he called a 'unified theory' - that he believed would reveal the probabilities of quantum mechanics to be no more profound than the probabilities offered in weather forecasts, probabilities that simply reflect an incomplete knowledge of an underlying, definite reality. In 1935, through a disarmingly simple mathematical analysis, Einstein (with two colleagues) established a beachhead on the first front. He proved that quantum mechanics is either an incomplete theory or, if it is complete, the universe is - in Einstein's words - 'spooky.' Why 'spooky?' Because the theory would allow certain widely separated particles to correlate their behaviors perfectly (somewhat as if a pair of widely separated dice would always come up the same number when tossed at distant casinos). Since such 'spooky' behavior would border on nuttiness, Einstein thought he'd made clear that quantum theory couldn't yet be considered a complete description of reality. The nimble quantum proponents, however, would have nothing of it. They insisted that quantum theory made predictions - albeit statistical predictions - that were consistently born out by experiment. By the precepts of the scientific method, they argued, the theory was established. They maintained that searching beyond the theory's predictions for a glimpse of a reality behind the quantum equations betrayed a foolhardy intellectual greediness. Nevertheless, for the remaining decades of his life, Einstein could not give up the quest, exclaiming at one point, 'I have thought a hundred times more about quantum problems than I have about relativity.' He turned exclusively to his second line of attack and became absorbed with the prospect of finding the unified theory, a preoccupation that resulted in his losing touch with mainstream physics. By the 1940's, the once dapper young iconoclast had grown into a wizened old man of science who was widely viewed as a revolutionary thinker of a bygone era. By the early 1950's, Einstein realized he was losing the battle. But the memories of his earlier success with relativity - 'the years of anxious searching in the dark, with their intense longing, their alternations of confidence and exhaustion and the final emergence into the light' - urged him onward. Maybe the intense light of discovery that had so brilliantly illuminated his path as a young man would shine once again. While lying in a bed in Princeton Hospital in mid-April 1955, Einstein asked for the pad of paper on which he had been scribbling equations in the desperate hope that in his final hours the truth would come to him. It didn't. Was Einstein misguided? Must we accept that there is a fuzzy, probabilistic quantum arena lying just beneath the definitive experiences of everyday reality? As of today, we still don't have a final answer. Fifty years after Einstein's death, however, the scales have certainly tipped farther in this direction. Decades of painstaking experimentation have confirmed quantum theory's predictions beyond the slightest doubt. Moreover, in a shocking scientific twist, some of the more recent of these experiments have shown that Einstein's 'spooky' processes do in fact take place (particles many miles apart have been shown capable of correlating their behavior). It's a stunning finding, and one that reaffirms Einstein's uncanny ability to unearth features of nature so mind-boggling that even he couldn't accept what he'd found. Finally, there has been tremendous progress over the last 20 years toward a unified theory with the discovery and development of superstring theory. So far, though, superstring theory embraces quantum theory without change, and has thus not revealed the definitive reality Einstein so passionately sought. With the passage of time and quantum mechanics' unassailable successes, debate about the theory's meaning has quieted. The majority of physicists have simply stopped worrying about quantum mechanics' meaning, even as they employ its mathematics to make the most precise predictions in the history of science. Others prefer reformulations of quantum mechanics that claim to restore some features of conventional reality at the expense of additional - and, some have argued, more troubling - deviations (like the notion that there are parallel universes). Yet others investigate hypothesized modifications to the theory's equations that don't spoil its successful predictions but try to bring it closer to common experience. Over the 25 years since I first learned quantum mechanics, I've at various times subscribed to each of these perspectives. My shifting attitude, however, reflects that I'm still unsettled. Were Einstein to interrogate me today about quantum reality, I'd have to admit that deep inside I harbor many of the doubts that gnawed at him for decades. Can it really be that the solid world of experience and perception, in which a single, definite reality appears to unfold with dependable certainty, rests on the shifting sands of quantum probabilities? Well, yes. Probably. The evidence is compelling and tangible. Although we have yet to fully lay bare quantum mechanics' grand lesson for the underlying nature of the universe, I like to think even Einstein would be impressed that in the 50 years since his death our facility with quantum mechanics has matured from a mathematical understanding of the subatomic realm to precision control. Today's technological wizardry (computers, M.R.I.'s, smart bombs) exists only because research in applied quantum physics has resulted in techniques for manipulating the motion of electrons - probabilities and all - through mazes of ultramicroscopic circuitry. Advances hovering on the horizon, like nanoscience and quantum computers, offer the promise of even more spectacular transformations. So the next time you use your cellphone or laptop, pause for a moment. Recognize that even these commonplace devices rely on our greatest, yet most puzzling, scientific achievement and - as things now stand - tap into humankind's most supreme assault on the idea that reality is what we think it is. Brian Greene, a professor of physics and mathematics at Columbia, is the author of 'The Elegant Universe,'' and, most recently, 'The Fabric of the Cosmos.'

Subject: Comes a Quest to Save the Tiger From: Emma To: All Date Posted: Tues, Aug 16, 2005 at 12:08:58 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2005/08/16/science/16conv.html From a Childhood Ambition Comes a Quest to Save the Tiger By CLAUDIA DREIFUS In the 1960's, when Ullas Karanth was a teenager in India, he read books by naturalists who were researching the tigers of Asia. 'Someday, I'll study tigers, too,' he told himself. But in a country still emerging from colonial rule, there was no such profession as wildlife biologist. And so Ullas Karanth took up engineering, which he detested, only to give it up and become a farmer, bringing him closer to the wilderness and the tigers. By the 1980's, he had established himself as a kind of amateur biologist gathering information on the animals of the Nagarahole reserve near to his farm. That work eventually led to an opportunity to study in the United States and later to become a protégé of the pioneering tiger expert George Schaller. Today Dr. Karanth is himself a leading tiger researcher and the director of the Wildlife Conservation Society's India Program, which is based in Bangalore. Dr. Karanth, 57, was in New York on a recent summer afternoon to attend a conference at the Bronx Zoo, a subsidiary of the conservation society, on the future of tigers in the wild. In a break in the proceedings, he spoke of his favorite feline. Q. Do we know how many wild tigers still exist in India? A. We don't. The government claims that there are over 3,000. But that figure is based on a flawed counting method that officials developed for themselves. There are preservation groups who claim the number is more like 1,000. It's probably not that low. At the Wildlife Conservation Society, we won't guess. What we will say, based on scientific data, is that there are only about 115,000 square miles of forest still left in the country where tigers can thrive and breed. In most of that territory, there's been a tremendous tiger decline due to habitat degradation by local people and development activities like mines, dams and roads, and the poaching of tiger prey. We believe that if India is to have tigers, these wildlife reserves must be rigorously protected. Q. Is the killing of tigers for use in traditional Chinese medicine contributing to their disappearance? A. That's part of it. The fact that the parts of one dead tiger are worth something like $5,000 certainly encourages poachers. Actually the biggest threat to tiger survival is habitat destruction and the uncontrolled hunting of tiger-prey species. We have plenty of forest areas where there should be tigers, but their numbers are low there because the prey species have been hunted out by local people. So it turns out that if you want to protect tigers, you also need to protect the deer. In India, wildlife conservation has an unusual history. Tigers were very much in decline until the 1970's, when Indira Gandhi came to power. She was an autocrat. But she was also a very keen naturalist, and she had complete control over the nation's politics. Mrs. Gandhi told her minions that there would be no more destruction of important wildlife areas and she enforced that order. She put in strong laws, stopped uncontrolled hunting and logging in the reserves. And thanks to her cracking of the whip, the tiger came back. That recovery continued until the 1990's, when Indian politics became very fragmented. The leaders we've had since are excellent on economic development, but none have shown much interest in conservation. Q. You've spent decades observing tiger behavior. What do you find most interesting about them? A. The way nature has designed them. They are built to take down prey four to five times their own size. If I went into the forest, it would be hard for me to get within striking range of a deer. This huge cat does it effortlessly. It can grab onto something that weighs about a ton, wrestles it down and kill it, all very safely and quietly. Q. Have you ever gotten emotionally involved with the animals you were observing? A. Objective scientists aren't supposed to, but I have. During the early 1990's, I was putting radio collars on tigers and leopards at Nagarahole reserve in southern India and then tracking their behavior. With time, this one leopard got really quite habituated to me. For two years, I'd follow him at night. I had a little laboratory in the middle of the forest, and this leopard used to come around at midnight frequently and I'd hear his call. Even half asleep, I'd turn on my receiver and when I'd pick up his signals, I felt, oh, O.K., there's my leopard. But one morning, his signal read as if he was lying inactive somewhere in the forest and I really got worried. When I finally located him, he was strung up like a lynching victim. The leopard had walked into a snare some poacher had set up for deer. Yes, I know, leopards have high mortality rates, and I'm not supposed to feel emotion. But when this happens to a creature you know, you can't be coldblooded. Incidents like this happen every day and their toll on animal life is cumulative. The killers are usually local people trying to get some protein. However, this is one reason I feel negatively toward the 'sustainable use' concept that one hears so much in development circles. Q. What's wrong with the concept of sustainable use and the idea of financing projects for local people to make money from the forests, and in turn protect the animals? A. It's naïve. People and tigers have never coexisted harmoniously. They compete for land, protein, resources. In a country like India where there are so many people and so little land, sustainable development is actually a recipe for wiping out the protected areas. If you want tigers, you can't have people sweeping through the reserves cutting down trees, gathering forest products, hunting for protein and creating gardens that fragment the natural areas. Moreover, you definitely should not be paying forestry officials - charged with protecting wildlife - to do rural economic development. If you do it, their mission drifts toward development and the wildlife conservation part gets lost. To protect wildlife, you have to do the harder thing, which is set aside some areas where human activities are reduced or eliminated. At present, about 5 percent of the country is designated as protected. But I estimate that 75 percent of that 'protected' land has been compromised by human activity. This needs to be halted. Q. Do you think the Indian tiger can be saved? A. Certainly. If there's the will. One thing that gives us a head start: India actually has more wild tigers than our neighbors. We won't need to reintroduce them. Also, tigers reproduce easily; they are not like pandas. Also, I believe that there are aspects of Indian culture that can be mobilized for conservation. If you look at the Hindu religion, there's real guilt associated with the killing of an animal. So if you are protecting a park and you catch a poacher, this sense of guilt puts the enforcement officials at an advantage. Another thing, at the core of our religion is the belief that man is a part of nature. This supports the idea that wild animals have a right to survive. I've talked with farmers whose crops have been raided by elephants, and they really hated them. But when you asked, 'Don't elephants and tigers have the right to exist?' they always said yes. All these factors make me optimistic.

Subject: The Long Arm of Einstein From: Emma To: All Date Posted: Tues, Aug 16, 2005 at 11:52:03 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2005/08/16/science/16gps.html The Long Arm of Einstein Guides My Steering Wheel By LAWRENCE M. KRAUSS I was driving in Los Angeles a few weeks ago and relying on a global positioning system receiver attached to my hand-held organizer, which was verbally guiding me through a maze of freeways and unfamiliar streets. I had plenty of time stopped in traffic jams to ponder the scientific breakthroughs that made this technology possible. What I thought about were not the triumphs of Silicon Valley and microchips. I thought about Albert Einstein. The United Nations and several other international organizations have designated 2005 as the World Year of Physics in honor of Einstein's 'miracle year' in 1905, when he wrote five seminal papers that changed the way we think about the world. But his greatest achievement occurred a decade later, when he finished his general theory of relativity. Einstein revolutionized our understanding of space, time and the nature of gravity. He described a universe in which matter and energy could curve space, which in turn would affect the dynamics of matter and energy, which then could affect the geometry of space, and so on. It took more than three decades to develop the first direct terrestrial experimental tests of his esoteric ideas. But, esoteric or not, without general relativity, I couldn't precisely navigate through Los Angeles. Global positioning systems rely on careful measurement differences between signals sent from several satellites thousands of miles apart. The time differences between the signals sent to the device in my car must be measured to an accuracy of about a billionth of a second to distinguish my position to within a few feet. But general relativity predicts that the relative clicking of clocks changes depending on their position in a gravitational field. Satellites located high above Earth are moving in a gravitational field that is slightly weaker than what we experience on the ground. As a result, their internal clocks tick at a different rate than those on Earth. The effect is extremely small, but it is comparable to the accuracy needed to distinguish the position of objects on the scale that is otherwise possible with needed by global positioning devices. Without correcting for it, the systems would give results that are ever so slightly off. Einstein didn't develop general relativity because he wanted to find a better way to track his own position. He wanted to address fundamental questions about the universe, and even if he had been so inclined he probably could not have foreseen in 1915 the technology that makes G.P.S. measurements possible today. This is a timely example of the cross-germination of fundamental scientific investigation and modern technological innovation than this. The insights that Einstein's theories have given us about the basic workings of the cosmos, on scales as large as the visible universe itself, and going back to the earliest moments of the Big Bang, are invaluable to our understanding of nature and themselves should justify the support we provide for continuing research in general relativity and cosmology. But in a time when many areas of fundamental research are facing drastic budget threats in favor of more targeted programs with short-term goals, it is worth remembering that even the most esoteric scientific ideas can ultimately affect one's daily life. It is something worth thinking about the next time you are caught in a traffic jam. Lawrence M. Krauss is director of the Center for Education and Research in Cosmology and Astrophysics at Case Western Reserve University. His new book,'Hiding in the Mirror,' will appear this fall.

Subject: And Newton? From: Mik To: Emma Date Posted: Tues, Aug 16, 2005 at 13:57:37 (EDT) Email Address: Not Provided Message: I know this is the year where we are to give respect to Einstein for what he did, but I do think it is somewhat unfair to give this much credit to Einstein for the GPS technology and no where as much to Newton or Doppler. The error correction due to Einstein's theory of relativity is ever so slight (as the author points out). The error could be about 2 feet (if that) where as the overall error from a GPS is in excess of 4 feet. Meaning that Einstein's contribution to the GPS is negligable. Sorry for being so cynical. Without Newton on the other hand, the GPS system would not even be up in the space let alone measuring where we are. We use Newton's laws of gravity (not Einstein's) to get the rocket/satelite into space. The orbit and angle for broadcasting signals are decided using Newtonian physics/mechanics. And after moving from the genius of what Newton left us, let's not forget Doppler who worked out that frequecy changes based on movement. By measuring the Doppler effect we can figure out the movement of the satelite and the movement of the car. Yes Einstein's theories apply well to Cosmology (better than Newtonian and Doppler), but perhaps Lawrence Krauss has a bias towards Einstein.

Subject: Re: And Newton? From: Emma To: Mik Date Posted: Tues, Aug 16, 2005 at 14:20:55 (EDT) Email Address: Not Provided Message: Of course you are right, but remember that Newton's mathematics is not set aside by Einstein's except in extreme circumstances. Newton is simple subsumed, and Doppler gave Einstein ideas on special relativity effects. Listen to a train whistle as the tone changes and think of relativity of motion with only light speed constant.

Subject: Sorry Emma From: Mik To: Emma Date Posted: Tues, Aug 16, 2005 at 15:21:39 (EDT) Email Address: Not Provided Message: You are right. I've just overly cynical lately. I've gota starting being more positive.

Subject: Re: Sorry Emma From: Emma To: Mik Date Posted: Tues, Aug 16, 2005 at 16:28:38 (EDT) Email Address: Not Provided Message: No, you are always making me think of interesting possibilities. I am still working on applying Jared Diamond.

Subject: Re: Sorry Emma From: Emma To: Emma Date Posted: Tues, Aug 16, 2005 at 16:31:04 (EDT) Email Address: Not Provided Message: Notice the Niger post from Sunday. 'Meanwhile, People Starve.'

Subject: Niger From: Mik To: Emma Date Posted: Wed, Aug 17, 2005 at 14:53:25 (EDT) Email Address: Not Provided Message: I made a posting in reply to you Niger article. But it appears to have been pushed off the board. Did you my response?

Subject: Re: Niger From: Emma To: Mik Date Posted: Wed, Aug 17, 2005 at 15:44:07 (EDT) Email Address: Not Provided Message: Excellent, posted above.

Subject: Gossip Turns Out to Serve a Purpose From: Emma To: All Date Posted: Tues, Aug 16, 2005 at 11:51:32 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2005/08/16/science/16goss.html Have You Heard? Gossip Turns Out to Serve a Purpose By BENEDICT CAREY Juicy gossip moves so quickly - He did what? She has pictures? - that few people have time to cover their ears, even if they wanted to. 'I heard a lot in the hallway, on the way to class,' said Mady Miraglia, 35, a high school history teacher in Los Gatos, Calif., speaking about a previous job, where she got a running commentary from fellow teachers on the sexual peccadilloes and classroom struggles of her colleagues. 'To be honest, it made me feel better as a teacher to hear others being put down,' she said. 'I was out there on my own, I had no sense of how I was doing in class, and the gossip gave me some connection. And I felt like it gave me status, knowing information, being on the inside.' Gossip has long been dismissed by researchers as little more than background noise, blather with no useful function. But some investigators now say that gossip should be central to any study of group interaction. People find it irresistible for good reason: Gossip not only helps clarify and enforce the rules that keep people working well together, studies suggest, but it circulates crucial information about the behavior of others that cannot be published in an office manual. As often as it sullies reputations, psychologists say, gossip offers a foothold for newcomers in a group and a safety net for group members who feel in danger of falling out. 'There has been a tendency to denigrate gossip as sloppy and unreliable' and unworthy of serious study, said David Sloan Wilson, a professor of biology and anthropology at the State University of New York at Binghamton and the author of 'Darwin's Cathedral,' a book on evolution and group behavior. 'But gossip appears to be a very sophisticated, multifunctional interaction which is important in policing behaviors in a group and defining group membership.' When two or more people huddle to share inside information about another person who is absent, they are often spreading important news, and enacting a mutually protective ritual that may have evolved from early grooming behaviors, some biologists argue. Long-term studies of Pacific Islanders, American middle-school children and residents of rural Newfoundland and Mexico, among others, have confirmed that the content and frequency of gossip are universal: people devote anywhere from a fifth to two-thirds or more of their daily conversation to gossip, and men appear to be just as eager for the skinny as women. Sneaking, lying and cheating among friends or acquaintances make for the most savory material, of course, and most people pass on their best nuggets to at least two other people, surveys find. This grapevine branches out through almost every social group and it functions, in part, to keep people from straying too far outside the group's rules, written and unwritten, social scientists find. In one recent experiment, Dr. Wilson led a team of researchers who asked a group of 195 men and women to rate their approval or disapproval of several situations in which people talked behind the back of a neighbor. In one, a rancher complained to other ranchers that his neighbor had neglected to fix a fence, allowing cattle to wander and freeload. The report was accurate, and the students did not disapprove of the gossip. But men in particular, the researchers found, strongly objected if the rancher chose to keep mum about the fence incident. 'Plain and simple he should have told about the problem to warn other ranchers,' wrote one study participant, expressing a common sentiment that, in this case, a failure to gossip put the group at risk. 'We're told we're not supposed to gossip, that our reputation plummets, but in this context there may be an expectation that you should gossip: you're obligated to tell, like an informal version of the honor code at military academies,' Dr. Wilson said. This rule-enforcing dynamic is hardly confined to the lab. For 18 months, Kevin Kniffin, an anthropologist at the University of Wisconsin, tracked the social interactions of a university crew team, about 50 men and women who rowed together in groups of four or eight. Dr. Kniffin said he was still analyzing his research notes. But a preliminary finding, he said, was that gossip levels peaked when the team included a slacker, a young man who regularly missed practices or showed up late. Fellow crew members joked about the slacker's sex life behind his back and made cruel cracks about his character and manhood, in part because the man's shortcoming reflected badly on the entire team. 'As soon as this guy left the team, the people were back to talking about radio, food, politics, weather, those sorts of things,' Dr. Kniffin said. 'There was very little negative gossip.' Given this protective group function, gossiping too little may be at least as risky as gossiping too much, some psychologists say. After all, scuttlebutt is the most highly valued social currency there is. While humor and story telling can warm any occasion, a good scoop spreads through a room like an illicit and irresistible drug, passed along in nods and crooked smiles, in discreet walks out to the balcony, the corridor, the powder room. Knowing that your boss is cheating on his wife, or that a sister-in-law has a drinking problem or a rival has benefited from a secret trust fund may be enormously important, and in many cases change a person's behavior for the better. 'We all know people who are not calibrated to the social world at all, who if they participated in gossip sessions would learn a whole lot of stuff they need to know and can't learn anywhere else, like how reliable people are, how trustworthy,' said Sarah Wert, a psychologist at Yale. 'Not participating in gossip at some level can be unhealthy, and abnormal.' Talking out of school may also buffer against low-grade depressive moods. In one recent study, Dr. Wert had 84 college students write about a time in their lives when they felt particularly alienated socially, and also about a memory of being warmly accepted. After finishing the task, Dr. Wert prompted the participants to gossip with a friend about a mutual acquaintance, as she filmed the exchanges. Those who rated their self-esteem highly showed a clear pattern: they spread good gossip when they felt accepted and a more derogatory brand when they felt marginalized. The gossip may involve putting someone else down to feel better by comparison. Or it may simply be a way to connect with someone else and share insecurities. But the end result, she said, is often a healthy relief of social and professional anxiety. Ms. Miraglia, the high school teacher, said that in her previous job she found it especially comforting to hear about more senior teachers' struggle to control difficult students. 'It was my first job, and I felt overwhelmed, and to hear someone say, 'There's no control in that class' about another teacher, that helped build my confidence,' she said. She said she also heard about teachers who made inappropriate comments to students about sex, a clear violation of school policy and professional standards. Adept gossipers usually sense which kinds of discreet talk are most likely to win acceptance from a particular group. For example, a closely knit corporate team with clear values - working late hours, for instance - will tend to embrace a person who gripes in private about a colleague who leaves early and shun one who complains about the late nights. By contrast, a widely dispersed sales force may lap up gossip about colleagues, but take it lightly, allowing members to work however they please, said Eric K. Foster, a scholar at the Institute for Survey Research at Temple University in Philadelphia, who recently published an analysis of gossip research. It is harder to judge how gossip will move through groups that are split into factions, like companies with divisions that are entirely independent, Dr. Foster said. 'In these situations, it is the person who gravitates into a intermediate position, making connections between the factions, who controls the gossip flow and holds a lot of power,' he said. Such people can mask devious intentions, spread false rumors and manipulate others for years, as anyone who has worked in an organization for a long time knows. But to the extent that healthy gossip has evolved to protect social groups, it will also ultimately expose many of those who cheat and betray. Any particularly nasty gossip has an author or authors, after all, and any functioning gossip network builds up a memory. So do the people who are tuned in to the network. In one 2004 study, psychologists had college students in Ohio fill out questionnaires, asking about the best gossip they had heard in the last week, the last month and the last year. The students then explained in writing what they learned by hearing the stories. Among the life lessons: 'Infidelity will eventually catch up with you,' 'Cheerful people are not necessarily happy people' and 'Just because someone says they have pictures of something doesn't mean they do.' None of which they had learned in class.

Subject: Spyware and Cookies From: Emma To: All Date Posted: Tues, Aug 16, 2005 at 07:22:01 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2005/08/15/business/media/15adcol.html Spyware Heats Up the Debate Over Cookies By BOB TEDESCHI INTERNET users are taking back control of their computers, and online marketers and publishers are not pleased with the results. But they don't quite know what to do about their conundrum - if it is a conundrum, since they can't even agree on that. Until recently, Internet businesses could track their users freely, using what are known as cookies, tiny text files they embed on the user's hard drive. Now, with the proliferation of antispyware programs that can delete unwanted cookies, they often cannot tell who has been to their Web site before or what they have seen. And this erosion of control over a tool for gaining insight into consumer behavior has many of them fretting. 'Cookies are critical from a business perspective,' said Lorraine Ross, vice president for sales at USAToday.com. 'They help us do things like track our profitability per unique visitor, for instance. But if you don't know how many people are coming in, you don't really have a handle on whether your profitability is improving or not.' It isn't necessarily just corporate America that is threatened by the anticookie fervor, Ms. Ross said - the deleters stand to suffer, too. For example, cookies help a computer limit how many times a user sees annoying ads like a floating, animated message. Such 'frequency caps,' to use industry parlance, are common among publishers. 'So cookies are a really good thing for managing the user's experience,' she said. Last year, though, Ms. Ross said executives at the company debated how effective their frequency limits were, since a growing number of Internet users were deleting cookies and possibly seeing lots of animated ads. Ms. Ross said that like most established companies, USAToday.com did not use its cookies to identify its users. 'But the user's paranoia is understandable, given the history,' she said. Cookies first got a bad name in 1999, when DoubleClick announced that it would use them to identify Internet users and analyze both their offline purchasing patterns and online surfing habits for the purpose of showing them more relevant online ads. That plan died a loud, painful death after privacy advocates objected strenuously, and marketers and publishers have since taken a much more cautious approach. Even so, privacy advocates deplore cookies and, as software programs like Webroot Spy Sweeper and McAfee AntiSpyware have come on the market, surfers by the millions are apparently knocking the cookies out of service as fast as the programs can be installed. This spring, the online consulting firm Jupiter Research published a report saying that nearly 40 percent of Internet users surveyed regularly erased them. 'I don't think cookies should be out there at all,' said Marc Rotenberg, executive director of the Electronic Privacy Information Center, an advocacy group based in Washington, 'but the good news here is that consumers are at least becoming more sophisticated about the appropriate use of cookies.' Eric Peterson, the analyst who wrote the Jupiter report, pointed out that most of the deleted files were so-called third-party cookies placed on the computer by a company other than the one operating the site the user was visiting. Most publishers rely on outside companies like DoubleClick and Atlas to send ads to the user's computer and track the effectiveness of campaigns. Antispyware programs often leave in place first-party cookies, which can save users the inconvenience of having to log in to a news site each time they visit, but remove third-party cookies, the main target of users' ire. Some people say they think that total anonymity is the way to go. The threat to the bottom line is real. Mr. Peterson said cookies not only helped sites measure overall profitability, but were critical in measuring the effectiveness of individual advertising campaigns. Marketers, for instance, could conceivably pay a Web site to deliver ads to 100,000 people, but only reach about 60,000 because so many of them were being counted twice. 'If you're O.K. with getting your ads to half as many people, and not really being sure how effective your campaign was, well then you can happily put your head in the sand,' Mr. Peterson said. 'Most people tell us they want data more accurate than that.' But are that many people really blocking cookies? Some executives aren't so sure. 'When I talk to publishers, nobody says the problem is as big as the press suggests,' said Greg Stuart, chief executive of the Interactive Advertising Bureau, an industry trade group. 'So our role should be to get to some factual basis.' Mr. Stuart said his organization was planning its own research into the issue because, he said, much of the recent research 'involves asking consumers about what they did, which isn't always a good indicator of their behavior.' Another doubter is Peter Naylor, senior vice president for sales at iVillage, a network of women's sites. 'I don't think the problem is real, based on what we're seeing, or more importantly not seeing,' he said. Mr. Naylor said he had not conducted tests or surveys to determine if his company's visitors were deleting or blocking cookies, 'but nothing has changed dramatically enough to raise a red flag.' 'And I've heard literally nothing about it from advertisers,' he added. Among those companies fielding the most calls about cookie deletion are advertising technology businesses like Atlas. Young-Bean Song, the director of analytics for Atlas, said that even if the cookie deletion rates were as high as 40 percent, publishers and marketers could still rely on the data from the 60 percent remaining of a site's users to gauge the effectiveness of their advertising campaigns and other important statistics. Perhaps because executives cannot agree on the scope of the problem, solutions have been slow to emerge. Mr. Stuart of the Interactive Advertising Bureau said that if the issue turned out to be as big as some suspect, his organization was likely to embark on an ad campaign to convince online users that cookies were not harmful. Already, Internet companies are trying to accommodate Web users in practical ways. In May, WebTrends, a site that had helped online businesses analyze advertising and Web site data by using third-party cookies, began offering its clients the ability to offer first-party cookies without losing the data associated with the old third-party ones. Greg Drew, WebTrends' chief executive, said some users still blocked cookies altogether, so the solution was not completely effective. Still, he said, many clients had flocked to the service. In the meantime, Ms. Ross of USAToday.com said the real solution was to overcome consumer hostility toward what she regards as a legitimate business practice that makes life easier for everyone. That may be a long shot, but she is hopeful. 'We have to think about long-term answers,' she said. 'We need to have users love their cookies, for the right reasons.'

Subject: Philadelphia Story: The Next Borough From: Emma To: All Date Posted: Mon, Aug 15, 2005 at 15:37:34 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2005/08/14/fashion/sundaystyles/14PHILLY.html Philadelphia Story: The Next Borough By JESSICA PRESSLER PHILADELPHIA WEARING a Paul Green School of Rock T-shirt, his bangs plastered to his forehead in the summer heat, Laris Kreslins pulled in front of a handsome brownstone on Rittenhouse Square, the priciest neighborhood in the city, and hopped out of his car. 'We're going to show you what a real Philly apartment looks like,' he said, unlocking the door to reveal a spacious one-bedroom flat sparsely decorated with CD's and copies of music magazines. 'As you can see, it has hardwood floors, lots of light and very high ceilings,' he said. Then Mr. Kreslins paused and delivered what he knew would be the kicker: 'Rent is $800 a month. Heat and electricity included.' Mr. Kreslins isn't selling real estate. He's selling Philadelphia. The publisher of Arthur, a free arts and culture magazine, Mr. Kreslins, 30, lived in a tiny apartment in Williamsburg, Brooklyn, before leaving New York two years ago and ending up in Philadelphia, where he and his girlfriend, Kendra Gaeta, 30, another Brooklynite, bought a four-bedroom house close to the Philadelphia Museum of Art in March and promptly started a Web site, movetophilly.com. The site, designed to lure 20- and 30-something singles and couples to the city, features a sultry caricature of Patti LaBelle, a longtime resident, who entreats visitors to e-mail for the kind of tour Mr. Kreslins was recently holding, taking visitors to a thrift store, a Polish butcher and his friend Brendan's apartment. Philadelphians occasionally refer to their city - somewhat deprecatingly - as the 'sixth borough' of New York, and with almost 8,000 commuters making the 75-minute train ride between the cities each weekday, the label seems not far off the mark. But Mr. Kreslins and Ms. Gaeta are a new breed of Philadelphia-bound commuters, those who come from New York by train or the popular Chinatown bus for a weekend and then come back, with a U-Haul, to stay. They are the first wave of what could be called Philadelphia's Brooklynization. Hard numbers assessing exactly how many new residents are from New York are not available, but real estate brokers are noting an influx of prospective buyers and renters from the city; club owners and restaurant employees have spotted newcomers, on both sides of the bar; and 'everyone knows someone who's moved here from New York,' said Paul Levy, the executive director of the Center City District, a business improvement group, and himself a former Brooklyn resident. Attracted by a thriving arts and music scene here and a cost of living that is 37 percent lower than New York's, according to city figures, a significant number of youngish artists, musicians, restaurateurs and designers are leaving New York City and heading down the turnpike for the same reasons they once moved to Brooklyn from Manhattan. 'We got priced out of Manhattan, and we moved to Brooklyn,' said John Schmersal, 32, of the three-member band Enon; two of them migrated here in January. 'Then we got priced out of Brooklyn. Now we're in Philadelphia.' On a recent Friday night Mr. Schmersal and his girlfriend, Toko Yasuda, were huddled at the bar at the Khyber, a smoky rock institution in the nightclub-heavy Old City neighborhood, a Colonial area of narrow streets bordering the Delaware River east of City Hall, to see Love as Laughter, a New York City band. 'We like going to shows here,' Mr. Schmersal said. 'In New York there are so many people, it's impossible to even get in to see hot bands.' Much less be in a band. 'For years I was willing to sacrifice quality of life for artistic fulfillment - you know, you find a circle of artists and you scrape by,' said Anna Neighbor, a 27-year-old bass player and Williamsburg exile, between sips of Yuengling lager at a bar in the Northern Liberties neighborhood, an artists' enclave north of City Hall. In January Ms. Neighbor and her husband, Daniel Matz, and Jason McNeely, all members of the indie rock band Windsor for the Derby, decided to leave Brooklyn. Ms. Neighbor and Mr. Matz discovered Fishtown, a gentrifying blue-collar neighborhood adjacent to Northern Liberties, where, in the last five years, youthful faces with bed head have made their way among the traditionally Irish Catholic residents. They found a three-bedroom row house for $170,000. 'New York is mythologically all about vibrancy and creativity, but it's hard to work a 40-hour week and come home and be Jackson Pollock,' said Mr. Matz, 32, a guitarist. He said that by living in Philadelphia he could support himself teaching public school and devote the rest of his time to his band. A few blocks away from Ms. Neighbor's house live Laura Watt, a 38-year-old painter, and her husband, Clark Thompson, 38, a financial services technician who left his Manhattan-based bank for one in Philadelphia a year ago. They settled in a three-level condominium in a new housing development called Rag Flats in Fishtown with their two children, Gus and Lydia. At $439,000 it was pricier than any of the block's three-story row houses, but with three bedrooms, each with an outdoor deck; solar heat and electricity; a rooftop with spectacular views; and a dumbwaiter going down to the kitchen, they thought it was worth it. 'Philadelphia reminds me a lot of what Brooklyn used to be like,' said Ms. Watt, who had lived in Brooklyn and Westchester County for 15 years. Fifteen or 20 years ago, the idea of Philadelphia as a place to go for quality life would have been laughable to many people, even to Philadelphians. Sandwiched between New York and Washington, Philadelphia was a flyover city - trainover really - a place where a mayor had ordered the bombing of a neighborhood and where Eagles fans reveled in booing their own team, its chief popular exports cheese steaks and 'Rocky.' While Philadelphia's rich cultural history, like its art museum, its symphony orchestra and its Colonial architecture, gave the city establishment credentials, it did not produce much of an avant-garde. 'The Philadelphia market was really provincial,' said Steven Lowy, who opened a gallery in Philadelphia in 1984 but fled back to Manhattan three years later. Lately the city has stepped up its efforts to woo people back, in part by trying to position Center City as 'young and hip and cool,' said Meryl Levitz, the president of the Greater Philadelphia Tourism and Marketing Corporation, who regularly holds lunches at which she tells the New York media, 'We're closer than the Hamptons!' The campaign had a boost last month when Forbes magazine named Philadelphia No. 12 on its list of best cities for singles (out of 40), a jump from No. 15 a year ago. In 2004 tourists in Philadelphia numbered 25.5 million, an increase of 41 percent in the last five years, and though the city had been losing residents - especially young ones - steadily since the 1950's, when it had 2.07 million people, the population of the city, the nation's fifth-largest, has leveled off at 1.5 million in the last four years. A government plan to provide the city with free wireless Internet access has as yet gone unrealized, but the national publicity surrounding it has given Philadelphia a progressive image, as has a marketing campaign by the tourism bureau, started in 2003 to attract gay tourists. That tagline was 'Get your history straight and your nightlife gay.' 'There's a big gay clientele coming down here,' said Michael McCann, a real estate agent with Prudential Fox and Roach, who also said he has seen a 'significant increase' in buyers from Manhattan and has worked with 'a ton' of 'single people and couples between 28 and 43' from Brooklyn. Often they move to start the kind of business they had in New York. Danuta Mieloch, 39, an owner of Rescue Rittenhouse Spa, who administered body scrubs to celebrities at Paul Labrecque on the Upper East Side before moving to Philadelphia to start her own place, is an example. Jose Garces, 33, a former chef at Chicama and Pipa in Gramercy Park, will open Amada, a tapas restaurant in Old City, in September. Matthew Izzo, 35, and his business partner, Mark Ax, 35, defected from New York design firms to start their own home and design boutiques, the Matthew Izzo shops. 'It's just so much more workable here,' Mr. Izzo said. 'It's smaller and more manageable.' And Lindsay Berman, 27, who left a marketing job at the Showtime network in Manhattan, is waiting tables part time at Jones, a 70's throwback diner in Center City, while she gets her T-shirt line, Dirty Old Shirt, off the ground. Not that everyone is committed for life. Some 'can't give up their Brooklyn phone numbers,' said Heather Murphy Monteith, a dancer who runs a disco for toddlers. She has noticed 718 and 917 area codes popping up on the contact sheets. Some keep more than just their digits: Mitzi Wong, 36, a buyer for the Philadelphia-based trend mecca Anthropologie, bought a 'Jane Austen-like' row house in Society Hill, the historic Philadelphia neighborhood, but she is keeping her East Village apartment for weekends. Lee Daniels, a native Philadelphian and producer of the film 'Monster's Ball,' rents in Harlem but bought a luxury apartment on the Delaware riverfront. 'So many people are moving here,' Mr. Daniels said. 'People just fall in love with it.' Many of the things that were once deterring about Philadelphia have also been turned around. The recent lifting of archaic building ordinances and a 10-year tax abatement on new construction means that blighted factories and brownstones are now being converted, many into luxury apartments, and new buildings are going up in place of weed-filled lots. Bring-your-own restaurants, born out of Pennsylvania's Puritan liquor restrictions, have become a charming hallmark of Center City. Philadelphia still has its share of urban blight: It ranks higher than New York in homelessness, crime and poverty. It maintains a high position in the Men's Health list of America's Fattest Cities each year, and, as New Yorkers often complain, you would be hard-pressed to find much open after 2 a.m. But the renaissance in real estate and restaurants has aligned with the city's music scene, which runs the gamut of cool. In a recent conversation Nick Sylvester, who covers Philadelphia music for The Village Voice and Pitchfork Media, an online music magazine, mentions diverse acts like the indie rockers Dr. Dog and Man Man, Beanie Sigel's State Property crew, and D.J.'s Diplo and Dave Pianka. 'Philly's decidedly anti-scene, and that appeals to a lot of musicians that move there,' he said. 'They can actually do their own thing.' There are art shows of international renown, like the Salvador Dalí show at the Philadelphia Museum of Art in the spring, and shows by quirky collectives like Space 1026 in Chinatown, which recently housed an installation made with Cheez-Its. All of which has collided with a peculiar cultural moment in which uncool is the new cool, in which blue-collar scrappiness and a surfeit of fried-meat specialties now seems endearingly kitschy. At least one developer is banking on the hope that Philadelphia's appeal is not just a fleeting fad. On a vast tract of land in Northern Liberties, an area once notable for hate crimes and heroin availability, a 50-year-old former shopping center developer named Bart Blatstein is building a $100 million development. Scheduled for completion in 2007, it will have 1,000 apartments, half a million square feet of ground-floor retail space and 100,000 square feet of industrial-chic office space, all of which Mr. Blatstein says will be offered at reduced rents to 'edgy, creative types.' The project is seeking New Yorkers. (Mr. Blatstein's company, Tower Properties, plans to advertise both in The Village Voice and on New York's Craigslist.) 'We want it to be a cross between Williamsburg and SoHo,' he said. But Mr. Lowy, of Portico gallery in SoHo, is skeptical about the long-run chances for young artists: 'The quality of life is pretty good but many of those artists probably won't stay. Can you get an art dealer to come to your studio when you're in Philly? Sure, you have time to make more art, but there's no one to buy it.'

Subject: Death Tax? Double Tax? It's No Tax From: Emma To: All Date Posted: Mon, Aug 15, 2005 at 14:22:57 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2005/08/14/business/yourmoney/14view.html Death Tax? Double Tax? For Most, It's No Tax By EDMUND L. ANDREWS WASHINGTON WHEN Congress comes back from its summer recess, one of the first things Senate Republicans will try to do, again, is kill the estate tax. Perhaps no other tax has so many passionate, persevering and politically organized opponents as the estate tax, or 'death tax,' as they have branded it. As Michael J. Graetz and Ian Shapiro of Yale recount in 'Death by a Thousand Cuts' (Princeton University Press), their entertaining account of the repeal movement, opponents of the estate tax have already achieved a remarkable political feat by building broad public support for abolishing a tax that currently affects only 2 percent of all estates. But repeal would be costly - more than $70 billion a year, once it was complete - and many of the populist arguments in favor of repeal are misleading. If estate or inheritance taxes were frozen at today's levels, they would have almost no impact on family farmers and most small-business owners. And while opponents contend that the estate tax is a 'double tax,' many of the earnings that are subject to it were never taxed in the first place. The tax opponents, many of whom began as political neophytes more than 20 years ago, lead a powerful coalition of small-business owners, farmers, trade associations and corporate lobbying groups like the American Council on Capital Formation. Killing the estate tax is one of President Bush's top priorities, and the House of Representatives has already passed a repeal measure four different times. But Senate Republicans, despite attempts to cut a deal with conservative Democrats before the summer recess, have been stalled on the issue. Unable to muster the 60 votes they need to overcome a Democratic filibuster, Senate leaders are now vowing to push for full repeal as soon as they come back in September. Hoping to pressure Democrats from conservative farming states just before Congress adjourned, two business-backed advocacy groups spent about $500,000 on television ads last month in states including Montana, North Dakota, Arkansas and Louisiana. The ads, produced by the American Family Business Institute and the Free Enterprise Fund - the first an advocacy group dedicated to abolishing the estate tax, the second an advocacy group aimed at a wider range of tax cuts - focused on images of soldiers fighting on D-Day in World War II. 'The I.R.S. hits this greatest generation with an unjust double tax, the death tax,' the narrator intoned in an ad aimed at North Dakota. Viewers are urged to 'tell Kent Conrad,' the state's Democratic senator, to 'change his vote.' But despite the populist rhetoric and oft-repeated horror stories about families being forced to sell their farms in order to pay estate taxes, the battle is over a very large amount of money held by a very small number of families. A report last month by the Congressional Budget Office found that in 2000 only 2 percent of all estates - about 52,000 - were subject to any estate tax. At that point, taxes were imposed only on estates worth $675,000 or more. The limit rose to $1.5 million in 2004, and if that limit had been in effect in 2000, only 13,771 estates - fewer than 1 percent - would have been subject to the tax. All but 740 of them would have had enough in liquid assets to cover estate tax liabilities, the office estimated. At the moment, taxes are imposed only on estates worth more than $1.5 million. Under Mr. Bush's tax cut of 2001, the estate tax is set to shrink steadily over this decade and disappear in 2010. But the 2001 bill called for the estate tax to reappear in full force in 2011. The nonpartisan Joint Committee on Taxation estimates that full repeal would cost $290 billion over the next 10 years, but that calculation understates the true cost because full repeal would not occur until 2011. Once the estate tax was fully repealed, the Treasury would lose more than $70 billion a year in today's dollars. Over the first 10 years of full repeal, the cost would total more than $700 billion, plus interest. Assuming that the government is still running an annual deficit in 2011, which is more likely than not, the total 10-year cost would be close to $1 trillion. A compromise being floated by Senator Jon Kyl, Republican of Arizona, could be almost as expensive. Indeed, because of a strange wrinkle, the compromise could end up being far more generous to many heirs than outright repeal. Mr. Kyl's proposal called for excluding estate taxes on all property up to $3.5 million and taxing anything above that amount at 15 percent - the same rate now charged on capital gains. Under current law, estate tax rates range up to about 45 percent. As a practical matter, Mr. Kyl's approach would eliminate the estate tax for more than 99 percent of all families and greatly reduce taxes for the few who owed anything at all. If the $3.5 million exclusion were in effect in 2000, the Congressional Budget Office estimated, only 3,676 estates - about 0.15 percent of all estates - would have had to pay any tax. But the proposed compromise also comes with an important twist that could make it more expensive than the $53 billion a year estimated by Congressional tax scorers. The twist is that the proposal would retain a big tax break that is supposed to disappear along with the estate tax. That break is known as the 'stepped-up basis,' and it means that an heir does not owe any capital gains taxes on any increase in value of property during the life of the person who died. A mansion that appreciated to $10 million from $1 million, for example, would not be subject to any capital gains taxes on that profit if an heir sold it. For many families with estates worth less than $3.5 million, that could amount to a double tax break. A person could build up wealth for years, yet avoid paying taxes because the gains were all 'unrealized.' His children could then inherit the property, sell it and avoid both the capital gains and estate taxes. The added cost of retaining a stepped-up basis may be only partially reflected in the official cost estimates of Mr. Kyl's proposal, because it is difficult to estimate when people will sell inherited property. But the American Family Business Institute has said that a very high percentage of heirs sell or restructure their holdings within five years. That's why it is misleading for opponents of the estate tax to claim that it is a double tax on earnings that have already been taxed once. In many cases, that's not true. 'A lot of assets that passed through very large estates have never been taxed and never will be,' said Mr. Graetz of Yale. 'It's a very big issue.' For thousands of single-digit millionaires, that could be a very good deal indeed.

Subject: CBO and OMB - who gonna pay da tax? From: Johnny5 To: Emma Date Posted: Mon, Aug 15, 2005 at 19:57:33 (EDT) Email Address: johnny5@yahoo.com Message: Congressional Budget Office Douglas J. Holtz-Eakin , Congressional Budget Office Watched on cspan today - taxes are going to have to be paid by someone going forward 10 years, there is just no way around it. Elephants seem they want the poor man to pay, Donkey Spratt said wait, maybe the rich man needs to pay. I am all for it, let the rich man pay some more, kudlow and friends don't like the death tax, but I remember oliver stone's gordon gecko saying how too much wealth is controlled by idiot sons and widows.

Subject: Immigrant Women Line Up for Day Labor From: Emma To: All Date Posted: Mon, Aug 15, 2005 at 08:43:41 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2005/08/15/nyregion/15labor.html Invisible to Most, Immigrant Women Line Up for Day Labor By NINA BERNSTEIN The women are not noticed by the weekday morning crowds that rush past Eighth Avenue and 37th Street, in the heart of Manhattan's fashion district. They arrive in twos and threes after 8 a.m., shrinking against the buildings on both sides of the avenue, until scores of them are waiting, small, dark-haired Mexicans, Ecuadoreans, Hondurans. By noon they have vanished. In swift, discreet sidewalk negotiations, perhaps half have been hired for a day's work at the minimum wage or less in some of the neighborhood's last struggling garment factories. The rest have given up until tomorrow. A few miles away in Williamsburg, commuters on the busy Brooklyn-Queens Expressway are equally oblivious to the similar scene unfolding on an overpass above them. There, the work at stake is $8-an-hour housecleaning, and those vying for a day's scrubbing, mainly for Hasidic homemakers, stand in a crude ascending hierarchy of employer preference: Mexican and Central American women in their 30's at the back, Polish immigrant women in their 50's and 60's in the middle, and young Polish students with a command of English at the head of the line. At a time when male day laborers have become the most public and contentious face of economic immigration to the United States, these two rare female shape-ups have doubled in size almost unobserved in recent years. Their growth reflects a larger overlooked reality: Women make up 44 percent of the nation's low-wage immigrant work force, and worldwide, studies show, more and more women are migrating for work. Often invisible and undercounted, experts say, female economic migrants are an increasing presence, especially in big cities like New York, where the demand is not for men to pick lettuce or process poultry, but for women to pick up the scraps of a collapsed manufacturing sector, or to serve in the vast underground economy of domestic service. Although more women across the country are showing up in day-labor hiring halls, often run by grass-roots labor groups, experts say that these two female shape-ups may well be the only significant ones of their kind in the nation - places where women are willing to put their personal safety in jeopardy for a few hours of work. 'What else is there to do if you have nothing to eat?' asked Rosario Jocha, 49, still standing on Eighth Avenue at 11 a.m. on a recent Wednesday. She said she had recently grabbed a day's work cutting threads from jackets even when the employer, a Chinese immigrant subcontractor, insisted he could not pay more than $5.75 an hour, 25 cents below the state minimum wage. 'I've been here 11 years, and I still haven't found a stable, steady job.' At both locations, some of the women waiting for work had been in the country as little as a few months; others, like Ms. Jocha, a Queens resident from Ecuador, were old-timers who spoke of better jobs lost when small-business employers could not pay rising rent. On Eighth Avenue, merchants said that 100 to 150 women regularly sought work six mornings a week year round - double or triple the number when the intersection first emerged as an informal female hiring site about six years ago. Yet May Chen, a vice president of Unite, the garment workers' union, whose headquarters is only a dozen blocks away, said she was unaware of the shape-up's existence until she was asked about it for this article. And Aaron Adams, a veteran garment center landlord who passes by every day, said he had assumed the women standing there 'were just shooting the breeze.' Rhacel Salazar Parreñas, a sociologist who has written extensively about the feminization of migration, said she was not surprised. 'The space that these women occupy, the public spaces in the city, are just like fleeting moments,' she said. 'They don't really have a place in the city that's visible, so it's easy to ignore them.' Even the discussion of legal guest worker proposals in Congress centers on male migrants, she said. But though nationally men account for about two-thirds of labor migration among illegal immigrants, primarily because of agricultural demand, she said, global patterns indicate that women are easily half the immigrant workers flowing to large metropolitan areas like New York. Ms. Parreñas and other researchers find that women who migrate for work are likely to be single mothers supporting children in their native countries. Compared with their male counterparts, they earn less, despite higher levels of education, according to a 2002 study of the United States' low-wage immigrant work force by the Urban Institute, a research group in Washington, which estimated that two million foreign-born women made less than the minimum wage. Yet women are also more likely to remain in America, and they send home a higher proportion of their earnings. Unvarnished lessons in global supply, demand and division play out at both New York hiring sites. 'We never talk to the Latinas - sometimes they agree to work for less,' said Teresa, a 53-year-old Polish widow who, like many of the 60 women waiting for cleaning work near Marcy and Division Avenues in Williamsburg on a recent Friday morning, would give only her first name. At the other end of the curved concrete abutment, Maria, 35, from Ecuador, gave a shrug. 'They pay them more,' she complained, as a woman in Hasidic dress passed by the Spanish-speaking group and selected a tall young Polish woman. 'It's just that they're white.' Even among the Poles, immigration complicates the pecking order. Some older women won green cards after years as live-in maids for sponsors, and boast in broken English of children in college. Other women lack papers, or shuttle on temporary work visas between their struggling families in rural Poland and spartan, overpriced rooms in Brooklyn. And in summer, just when demand declines because of employer vacations, they now face growing numbers of young Polish women working illegally on tourist visas while living rent-free with Brooklyn relatives. 'They don't want babushkas,' complained Zofia, a 50-year-old mother of five, as a young Hasidic man led Justyne, a 24-year-old Polish student, to his S.U.V. Not all employers had the same preferences, however, and most, like Rifky Kohn, 28, a pregnant mother of four, were on foot. At midday, with the Sabbath approaching, she gladly hired a Polish woman in her late 60's. 'She looks more experienced,' explained Mrs. Kohn. Rosa Yumbla, who supports four children in Ecuador, recently skipped a day on the overpass to address a national conference of day labor organizers at New York University Law School. She spoke at the urging of the Latin American Workers Project, an advocacy group in Brooklyn. 'We suffer the changing weather throughout the year, the heat of the sun and cold in winter, because where we wait to be picked up is on the corner,' Ms. Yumbla said in Spanish to an audience that included the mayor's commissioner for immigrant affairs. 'Help us secure a space where we can be safer.' For now, the women depend on one another and their own instincts for safety. On a recent Wednesday, when a man on Eighth Avenue approached a young Mexican woman with a vague description of a part-time job in a store at the Port Authority, an older woman drew close and signaled disapproval. The man, who gave his name as Victor Miranda and his age as 55, then turned to Josefa Limas, 32, who arrived from Puebla, Mexico, only six months ago. She, too, shook her head. 'Sometimes they'll just end up taking you somewhere else,' she said, describing another woman's close call the previous day. 'An Indian man took her to an elevator and wouldn't let her out. He came over and tried to grab her. She pressed an emergency button and got away.' Still, the pressure to take chances can be strong. Nellie, 32, who shares a room in the Bronx, pulled out a picture of the three children she left four years ago with her sister in rural Ecuador, in an effort to earn money for the heart operation needed by her son, the youngest. 'The little I make here I send to him,' she said. 'Many times I just want to go to be with him, but I don't have the money to do so. It gives me a desperate feeling.' On this day she counted herself lucky: she had been called back for a second day's work at $6 an hour, she said. And leaving the line, she melted into the crowd.

Subject: Re: Immigrant Women Line Up for Day Labor From: Johnny5 To: Emma Date Posted: Mon, Aug 15, 2005 at 12:59:07 (EDT) Email Address: johnny5@yahoo.com Message: 'Compared with their male counterparts, they earn less, despite higher levels of education, according to a 2002 study of the United States' low-wage immigrant work force by the Urban Institute,' How said, higher education should be rewarded - they are supposed to be coming to a more fair country than they left no?

Subject: I don't understand Kudlow From: Poyetas To: All Date Posted: Mon, Aug 15, 2005 at 05:11:37 (EDT) Email Address: Not Provided Message: Based on what I've been seeing, everyone on this forum should have their own talkshow because they are twice as informed as everyone who does have a talkshow and debates Krugman. What in the world is Larry Kudlow talking about?? 1. 'the expansion of homeownership among the middle, lower-middle and lower-income classes is one of the great benefits and boons of this economic prosperity.' - People are just re-mortgaging their homes, that is no net increase in home ownership. 'But they are looking at stocks vs. real estate and saying, well, at least I am going to be able to hold my investment' - Your investment will hold as long as the housing market holds because the economy is 85% housing! Your putting all your eggs in one basket. ITS A HIGHLY CORRELATED ECONOMY!! 'Just real quick, I think it is an investment-led recovery, particularly capital investment' - Ummmmm, haven't we learned anything from the 1990's?? I've said this before...Money (with a view to profit) does not create solutions, money does not increase creativity. They are mutually exclusive. Invest in things that foster creative thoughts by all means, but don't expect to make returns off something as spontanious and irrational as human ingenuity. You will always lose!

Subject: Noyce on Cspan From: Johnny5 To: Poyetas Date Posted: Mon, Aug 15, 2005 at 13:07:06 (EDT) Email Address: johnny5@yahoo.com Message: 'but don't expect to make returns off something as spontanious and irrational as human ingenuity. You will always lose! ' HAHA - I just watched a special on the father of silicon valley, Noyce - he said he always liked ideas that were new and untested and hated the tried and true. Bill Gates is a slave to innovation. RE kudlow's claim - I have seen in inner city palm beach county, several homes that were very ugly and slum looking have been remodeled and renovated and the areas are looking better. True those people are under more debt load now, but their neighborhoods sure look pretty - I guess what do you think is more important - looking pretty or sustainable finances - now remember IMAGE is A LOT here in america. My carpentar redneck friend probably put it best, he was sick and tired of the women he saw read homes and garden and then to follow the latest fashion rip up a perfectly good kitchen to put in the latest corian countertops and make her husband have to work a second job to pay for it - HAHA! I think krugman is not so much about IMAGE as fundamentals - he would probably buy his daughters the 20 dollar jeans at kmart - but kudlow is gonna get his daughters the 300 dollar jeans because like he says - it looks better. HAHA!

Subject: Re: I don't understand Kudlow From: Emma To: Poyetas Date Posted: Mon, Aug 15, 2005 at 08:47:06 (EDT) Email Address: Not Provided Message: This is an excellent way to handle rebuttal. Nice points. 'Invest in things that foster creative thoughts by all means, but don't expect to make returns off something as spontanious and irrational as human ingenuity.' Nicely expressed.

Subject: investing From: byron To: All Date Posted: Sun, Aug 14, 2005 at 23:30:03 (EDT) Email Address: Not Provided Message: My daughter has a small amount in vanguard indext 500. She just started working a new job and i am trying to get her to start investing for her eventual retirement. Should she continue in the 500 indext or mix it up in some other vanguard funds? I know vanguard is touted quite a bit on this forum and the advise from you all is pretty sound. Byron

Subject: Re: investing From: Terri To: byron Date Posted: Mon, Aug 15, 2005 at 05:47:12 (EDT) Email Address: Not Provided Message: Byron Vanguard has switched all it indexes but the S&P to the Morgan Stanley constructions which are superior to the old indexes in construction. The S&P however is so popular that it has not been switched. John Bogle suggested years ago that the index of choice be broader than the S&P. So, I do not use the S&P. The Vanguard LargeCap Index is closest to the S&P but includes more midcap companies. Then there is the Total Stock Market Index which includes midcap and smallcap. There is the MidCap Index and value and growth in both large and small cap. I have leaned to value and midcap indexes, and much prefer the SmallCap Value index to the complete smallcap or growth smallcap. When building in the beginning I find no reason not to use a single index as LargeCap or Total Stock Market. I will add....

Subject: Re: investing From: John C. To: Terri Date Posted: Mon, Aug 15, 2005 at 12:43:25 (EDT) Email Address: Not Provided Message: 'Vanguard has switched all it indexes but the S&P to the Morgan Stanley constructions which are superior to the old indexes in construction' can you explain why they are better. I've heard arguments both ways, but would like your rational.

Subject: Utilities and Durables From: Johnny5 To: John C. Date Posted: Mon, Aug 15, 2005 at 20:06:17 (EDT) Email Address: johnny5@yahoo.com Message: I hold xom and vtrix, pete weis and warren buffet has said worry for the dollar, I share their concern. There are india and china funds like IIF that have done well recently and maybe not have a currency fall like ours. Between the 2 china scares me more with her state controlled companies and opaque banks and poor loans. Also you want to remember buffet was recently looking at buying utility companies, jim rogers on fox money hour also said to buy utilities - also Joe Kernan and the Brain on CNBC said GE may buy utilities - you may ask - who so many talking about utilities - well 70 year old laws have been changed and now big companies can buy small utilities - so they all are thinking this is probably gonna bring a lot of buyout offers for utilities from the big companies. I know terri has commented on healthcare and utilities and vangaurd has ETF's - so you may want to look there. Just last week I listened at old Peter Lynch Advice and bought some VDC - vanguard consumer durables - I hear discretionary spending is about to get very tight according to the congressional budget office. Stick with vanguard and thier ETF's and you should be A OK.

Subject: Re: Utilities and Durables From: Terri To: Johnny5 Date Posted: Mon, Aug 15, 2005 at 21:19:19 (EDT) Email Address: Not Provided Message: Use the full name to avoid being confused. What you bought was the Consumer Staples Index, not consumer durables. Staples are razor blades and such, where durables are furniture and such.

Subject: Oh no!! From: Johnny5 To: Terri Date Posted: Tues, Aug 16, 2005 at 01:18:44 (EDT) Email Address: johnny5@yahoo.com Message: Oh no - what am I to do Terri? I thought vanguard had a durables ETF - where am I to invest for durables? No vangaurd fund or ETF seems to have over 15% consumer durables - now I have a big hole in my diversification Terri. Oh this is very troublesome news - are there any etf's that can help me fill my durables need?

Subject: Re: investing From: Emma To: John C. Date Posted: Mon, Aug 15, 2005 at 14:37:19 (EDT) Email Address: Not Provided Message: The MSCI family are the finest indexes I know of. They are weighted for active shares only, so market capitalizations are better reflected. Because they reflect only active shares and are broader they are less volatile on movement of the largest companies. The indexes change less often, so there is less portfolio adjustment and cost and tax consequence. Changes in the indexes are made well after market closes, so are harder to gauge by speculators. Vanguard has made an excellent switch and has completely secure long term contracts that allow use of exchange traded funds for all the MSCI family.

Subject: Re: investing From: John C. To: Emma Date Posted: Mon, Aug 15, 2005 at 17:00:38 (EDT) Email Address: Not Provided Message: 'Because they reflect only active shares and are broader they are less volatile on movement of the largest companies' actually float adjusted indices by definition are more volatile than a full cap weighted counterpart; in this case that fact is irrelevant since we are talking about the style metrics used to categorize stocks, i.e. Barra uses the price/book ratio as its only metric, and MSCI uses multiple metrics to come up with a more liberal policy in categorizing stocks as value vs. growth, small vs. large, etc. In that case, Barra would be more 'volatile' in stock turnover. With that said, it doesn't necessarily mean going forward that MSCI funds will out perform Russell or Barra (Vanguard admits this point) rather they feel that the steps MSCI takes to construct an index is more appropriate.

Subject: Re: investing From: Emma To: Emma Date Posted: Mon, Aug 15, 2005 at 14:47:48 (EDT) Email Address: Not Provided Message: http://flagship5.vanguard.com/VGApp/hnw/FundsByName Superior after cost performance by MSCI to other index families. I love the Vanguard-MSCI family choice, though I want a Vanguard-MSCI Europe value index. We are so lucky to have Vanguard, and if you think other mutual fund families are a problem look to Europe, Japan, and Australia and feel even more fortunate.

Subject: Re: investing From: Terri To: Terri Date Posted: Mon, Aug 15, 2005 at 05:55:21 (EDT) Email Address: Not Provided Message: Emma posted these excellent articles below: http://www.nytimes.com/2005/08/13/business/13nocera.html Pro Tells Why the Little Guy Just Can't Win By Joseph Nocera http://www.vanguard.com/bogle_site/sp20050524.htm The Arithmetic of Mutual Fund Investing is More Important Than Ever Remarks by John C. Bogle Founder and Former Chairman, The Vanguard Group American Association of Individual Investors Philadelphia Chapter

Subject: Re: investing From: Terri To: Terri Date Posted: Mon, Aug 15, 2005 at 06:00:53 (EDT) Email Address: Not Provided Message: http://flagship5.vanguard.com/VGApp/hnw/FundsByName I have loved the Vanguard Health Care Fund for long term investing, but Vanguard closes funds from time to time so they do not become too large and this fund is closed at present. There is the Vanguard Health Care Index however.

Subject: Re: investing From: Jennifer To: Terri Date Posted: Mon, Aug 15, 2005 at 07:15:43 (EDT) Email Address: Not Provided Message: The reason for Vanguard is that is the company giving individual investors a real chance to come close to the sort of institutional returns we always hear advertised but never can come close to with high cost companies. Indexing or low cost management works wonderfully when we save and invest continually.

Subject: Re: investing From: byron To: Jennifer Date Posted: Mon, Aug 15, 2005 at 16:41:50 (EDT) Email Address: Not Provided Message: Thanks for your inputs and i will pass this info on to her.

Subject: Re: investing From: Britney To: byron Date Posted: Mon, Aug 15, 2005 at 19:46:48 (EDT) Email Address: Not Provided Message: This is good advice. My parents started using Vanguard in the early 1980s and we followed and have never had a regret. We index and use Health Care and Energy, but we also have bought individual company shares over the years when we thought the values right and just put the shares away. We use Vanguard for all our financial transactions.

Subject: Re: investing From: Dorian To: Britney Date Posted: Wed, Aug 17, 2005 at 04:44:50 (EDT) Email Address: Not Provided Message: We use Vanguard for all our financial transactions. What is a good investment brokerage to use to purchase stocks, mutual funds, etc.? Dorian

Subject: Re: investing From: Terri To: Dorian Date Posted: Wed, Aug 17, 2005 at 05:45:15 (EDT) Email Address: Not Provided Message: Vanguard serves as a mutual fund company, as a discount brokerage, and as a commercial bank. Financial planning or advising services are also available.

Subject: Re: investing From: Emma To: Terri Date Posted: Wed, Aug 17, 2005 at 10:20:52 (EDT) Email Address: Not Provided Message: Vanguard has all the services an investor needs.

Subject: A Selective Housing Bubble From: Terri To: All Date Posted: Sun, Aug 14, 2005 at 15:15:57 (EDT) Email Address: Not Provided Message: When we refer to a housing bubble, we are referring to speculative housing prices in select areas such as San Francisco or New York or Los Angeles or Miami, or what Paul Krugman has called the 'Zoned Zones' in which development prospects are reasonably limited. In the 'Flatlands' of Topeka or Minneapolis, housing prices have risen but development is simpler and there is no necessary bubble. I would not care to see the Fed worry about Miami and limit growth in Minneapolis.

Subject: Re: A Selective Housing Bubble From: Poyetas To: Terri Date Posted: Mon, Aug 15, 2005 at 04:39:26 (EDT) Email Address: Not Provided Message: My thoughts exactly Terri, Furthurmore, as previously mentioned, an interest rate hike will only deflate the bubble faster or even make it burst, which is the last thing the economy needs at the moment. The bubble is unsustainable but the aim should be to gradually reduce it rather than kill it. The problem is, who is going to pick up the slack? I've said this before, we need a new area of growth that is going to drive the economy for the next 10 years. IT is a facilitator but not an end itself. However, creativity is something that this administration demonstratibly lacks.

Subject: Federal Reserve Policy From: Terri To: All Date Posted: Sun, Aug 14, 2005 at 15:05:20 (EDT) Email Address: Not Provided Message: The legislative purpose of the Federal reserve is to balance a tendency to inflation with as robust a labor market as possible. Inflation refers to general price increases rather than to rising asset prices. There is no provision for the Fed to try to control specific asset prices. There is especially no reason for the Fed to try to lower housing prices in San Francisco with no regard to employment in Chicago. Risking a possible recession to control selectively rising asset prices, makes little sense.

Subject: Under Pressure From: E,mma To: All Date Posted: Sun, Aug 14, 2005 at 13:13:02 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2005/08/14/magazine/14CRYOVAC.html Under Pressure By AMANDA HESSER A few weeks ago at Per Se, Thomas Keller's four-star restaurant in New York City, a waiter set a salad of diced watermelon and hearts of peach palm in front of me. ''This is watermelon that has been Cryovacked,'' he explained. ''It's something new we're doing. I think you will like it.'' This was a watershed moment on two accounts. First, because Keller had indeed managed to make something as mundane as watermelon taste different -- it had the crisp density of a McIntosh apple. But also because American dining has reached the level of sophistication at which a waiter will assume that a diner knows what ''Cryovacked'' is, and that this knowledge will enhance the experience of tasting diced watermelon. That won't be assumed here. ''Cryovacking'' is an industry term for putting food in a plastic bag and vacuum-packing it. Sometimes the food is then cooked in the bag. Other times, the pressure of the packing process is used to infuse flavors into ingredients. The watermelon, for instance, was vacuum-packed with 20 pounds of pressure per square centimeter, to compact the fruit's cells and concentrate its flavor. It had the texture of meat. Just the thing for backyard picnics. Cryovacking, which is more often called sous vide (French for ''under vacuum''), is poised to change the way restaurant chefs cook -- and like the Wolf stove and the immersion blender, it will probably trickle down to the home kitchen someday. Cryovacking has also given great momentum to the scientific cooking revolution of the last five years. Chefs have begun using techniques developed for industrial food production and advances in science to manipulate the chemical make-up of proteins, starches and fats to create new textures and flavors -- everything from fried mayonnaise to hot gelatins. Ferran Adriá is often seen as the hero of this movement. From his tiny restaurant, El Bulli, in Rosas, Spain, Adriá has sought to reform diners' expectations of ingredients like caviar (his might look just like osetra but is made of squid ink and calcium chloride) and to invent new flavors and textures (carrot juice frothed to a texture he calls ''air''). But the man who helped Keller master the technique that would compress watermelon and poach lobster with exquisite results, who taught Wylie Dufresne how to ''flash pickle'' water chestnuts with honey and sherry vinegar and who is having a greater impact on how people cook than anyone since Escoffier is not even a chef. Bruno Goussault, 63, is both a scientist and an economist. He has been training chefs like Fabio Trabocchi at the Ritz-Carlton and Michel Richard at Citronelle, both in Washington, Dan Barber at Blue Hill in New York and Daniel Boulud at Daniel, also in New York, not only how to use sous vide but also to understand the science behind it. Where Escoffier organized the way chefs cook, dividing the professional kitchen into stations (sauces, cold foods, sautéing, pastry), Goussault has reprogrammed their approach to temperature, technique and taste -- their fundamental understanding of cooking. At Charlie Trotter's in Chicago, the intense heat and scrape of pans against the stove is giving way to an almost placid atmosphere, the barely audible hum of water baths that run 24 hours a day. Dufresne, the chef at the innovative Manhattan restaurant WD-50, calls Goussault's contribution to cooking ''monumental.'' The advancements he has made are on par with the invention of the food processor and the gas stove, Thomas Keller says, and they will be around forever. ''With the Cuisinart,'' Keller says, ''there was no one that came with it. You got the book inside. With sous vide, the technology is so complex and there are so many variables. The thing that comes with sous vide is Bruno.'' When I met Goussault this past June, he was working at the American office of Cuisine Solutions, a food manufacturer in Alexandria, Va. He had on a blue checked shirt and a tie dotted with tiny bunnies. Goussault wanted to show me around the Cuisine Solutions plant, so we dressed in lab coats, booties, shower caps and masks, as if we were preparing for surgery, then headed into the damp, cold world of a food factory. In one room, a row of square steel vats was set on a platform. Inside one of the vats, hundreds of lamb shanks, sealed in vacuum-packed plastic bags, were submerged in water, cooking. There was no scent of food, nor the kind of steam and heat we normally associate with cooking. ''When you cook at home, you have a lot of flavor in your apartment,'' Goussault explained. ''And when you cook sous vide, all that flavor is inside the bag.'' The sous vide bag works as a hermetic seal, keeping in both juices and aroma; and by cooking in water, you get better heat transfer than you would in, say, an oven. Goussault began working more intensively with Cuisine Solutions' American operations in 1998. The company, which now grosses $50 million a year, prepares food for the Super Bowl, Costco, the first-class cabins on Air France and American Airlines, the MGM Grand in Las Vegas and large hotel chains like Westin and Hyatt. Much of that food is cooked sous vide. When you order braised short ribs at the Hyatt Regency in Phoenix, what you are served was actually cooked for 42 hours in Virginia and then simply reheated in the bag and garnished in Phoenix. Until recently, Goussault's most significant work had been on this scale. He developed the sous vide process for a number of hotels and food companies in France, Japan, Hong Kong, the Philippines and the U.S., enabling them to produce higher quality foods without preservatives. And in Norway, Chile and Africa, he designed fish-processing factories, where line-caught fish are cleaned and cooked (some of them before the fish can go into rigor mortis, and therefore before enzymes begin breaking down the flesh), yielding better quality fish with a longer shelf life. Goussault, who logged more than 120,000 miles on airplanes last year, has more plans yet: he hopes to take sous vide to the Niger River basin between Mali and Niger, where farmers from surrounding regions take their cattle. He would build feedlots, using the local abundance of cottonseed for feed. After slaughtering, the meat could be cooked, sous vide of course, using solar power. Goussault designed the production line at Cuisine Solutions for 130,000 meals a day. Like most food factories, it is very cold, with large refrigerated rooms that decrease the risk of bacteria. Long conveyor grills sear hundreds of chicken breasts at a time; steel tumblers the size of jet engines are filled with ingredients, then pressurized, a process that forces seasonings to penetrate the foods more deeply. This is Goussault's real domain. He is as much an engineer as a scientist -- as pleased with his invention of nonslip doilies for French train tables as he is with his cooking techniques. For decades, food was poached in sturdy plastic bags at traditional temperatures, simmering or boiling. Goussault discovered that keeping the temperature as low as possible and later cooling the food in several stages yielded a wildly different -- and tastier -- result. A piece of fish, for instance, can be cooked at about 130 degrees -- a hot bath, essentially -- for 30 minutes, then cooled, successively, at room temperature, in cold water, then in ice water, before being reheated and served. Cooking in bags at such low temperatures was long considered a recipe for botulism, but Goussault has debunked this fear, proving that the long cooking times followed by proper cooling kill bacteria with the same effectiveness as higher temperatures, also stabilizing the food so it can be stored longer before serving. Higher temperatures, Goussault argues, do irreparable damage to food. The cell walls in the food burst, making it impossible for the food to reabsorb the liquid it loses. Roasting a chicken at 350 degrees until its internal temperature reaches 180 degrees (as the U.S.D.A. recommends) causes the breast meat to dry out and juices to accumulate in the bottom of the pan. Tradition has it that cooks use those lost juices to make a gravy, which is later reapplied to the dry meat. All of which, come to think of it, doesn't make much sense. Low temperatures make for extremely succulent food because there is virtually no loss of natural juices. All of the gravy is reabsorbed by the meat, intensifying its flavor and allowing it to retain its structural integrity. As Goussault explains, ''You have the expansion, you have a little purge and during the chilling system -- if you have a good chilling system -- you can absorb this exudation.'' There's nothing more romantic to a chef than absorbing exudation. Vacuum-packing foods provides a number of other advantages. The hermetic seal created in a sous vide bag traps flavor that would otherwise be lost. Carrots simmered in water, for instance, bleed off much of their flavor. As Yannick Alléno, the chef at Le Meurice, a two-star restaurant in Paris, points out, ''You would almost be better off drinking the water.'' The atmospheric pressure created during the vacuum-packing process also promotes osmosis among the contents of the bag, so sous vide has become an important tool for marinating and curing foods and infusing oils with spices and herbs. As a result, chefs don't need to use as much seasoning, either. When they are marinating a food with an expensive aromatic like truffles, this can make all the difference. After the tour, we sat down in a small test kitchen above the factory floor to taste some of the company's products -- a lamb shank that had been cooked for 36 hours, scallops and the like. Goussault ate with relish, washing it down with red wine. When he is at home in Paris, he likes to grill steaks and roast lamb, but for now those primitive techniques were far from view. Goussault instructed the chef in the kitchen to drop an egg into a thermal circulator, sous vide's ''oven'' -- a circulating water bath whose temperature can be adjusted to within a tenth of a degree. It was set at 64.5 degrees Celsius (about 148 degrees Fahrenheit), which he calculated as the perfect egg-cooking temperature. Chefs, Goussault said, ''need people like me to regulate and to push the creativity to the next place.'' He quantifies what chefs aim to do intuitively. Some need less help than others. ''I was in Joël's kitchen,'' Goussault said, referring to Joël Robuchon, one of France's most revered chefs, ''and he was cooking eggs, so I tested the temperature; I put in my probe, and it was 64.5. I asked him how he knew this, and he just said that was how he liked it best.'' After 45 minutes, the chef removed the egg from the water and Goussault cracked it over his plate. I had never seen an egg like this: the whites and yolk, cooked to precisely the same consistency, spilled out like a wobbly custard, and Goussault, using a spoon, began pulling the whites from the yolk. The yolk was bright and creamy and stood up like a marshmallow. ''You see, you see!'' Goussault said. ''It's all about the temperature.'' Sous Vide has been around since the late 1960's, when food-grade plastic films and vacuum packing were mastered by French and American engineers and later manufactured under the aegis of the Cryovac division of the W. R. Grace Company. Originally, vacuum-packing was used to seal and pasteurize industrial foods for a longer shelf life. In 1974, Pierre Troisgros, a three-star chef in Roanne, France, decided to look for a new way to cook his foie gras, which shed 30 to 50 percent of its original weight in cooking. He enlisted Georges Pralus, a chef, to help. Pralus had the idea of wrapping the foie gras in layers of plastic before they cooked it and, after a number of experiments, they had their breakthrough: the foie gras lost only 5 percent of its weight -- an enormous savings. Pralus, now widely known as the father of sous vide, eventually worked with Cryovac to open his own school, Culinary Innovation, where he taught the technique. Over the years, thousands of chefs from around the world have come to study with him. Goussault, as it happens, was working along the same lines, but at an industrial level. In 1974, Goussault worked on a study that was presented on the sous vide cooking of beef shoulder at an international frozen-foods conference in Strasbourg, France. They found that cooking the beef sous vide extended its shelf life to 60 days. France, however, would not change its food-safety laws regarding perishability until the 1990's. ''The thing I write today is the same thing I wrote 34 years ago,'' Goussault says, laughing, ''but nobody listened. Now, a few people listen.'' Today Goussault is friends with Pralus and even invests in his school, although they teach different approaches (Pralus cooks sous vide at higher temperatures), and they continue to subtly disparage each other's work. ''He might have done the research,'' Pralus said of Goussault, ''but I was the first one who did sous vide for restaurants, who made it a culinary endeavor.'' Without Pralus, sous vide might never have reached the temples of cuisine. Smiling, Goussault said: ''Pralus calls himself the pope of sous vide. He tells people he invented sous vide, but it's not true. But I let him say that because it makes him feel better. So after he said he was the pope, I said I was the sous-pope.'' Chefs say that Pralus is the artist, Goussault the scientist. It just happens that the artistry in sous vide can be extremely dangerous from a food-safety perspective, which is why the two began collaborating in 1980, when executives at Cryovac asked Goussault to add a scientific basis to Pralus's training. ''They asked me to give it the right system because Georges Pralus is completely undisciplined,'' Goussault explained. He has been the man behind the curtain all along. Goussault became a scientist almost as a last resort. He had previously studied in a seminary (an experiment that ended, he said, ''because I was not able to respect the vow of chastity''), lived in a commune, earned degrees in economics, agriculture and psychology and spent time in Niger before settling in Paris in 1970 as a scientist in food-safety laboratories. In the 1980's, a project with SNCF, France's national train system, gave him the opportunity to work with Joel Robuchon to create a menu for its first-class service between Paris and Strasbourg. Robuchon, concerned about the fragility of high-quality food, knew there was no way to assemble fresh ingredients at 100 miles per hour. With Goussault, he developed a menu based on foods that could be prepared sous vide and simply reheated on the train. In 1991, Goussault started his own consulting company, the Centre de Recherche et d'Études Pour l'Alimentation, where he now trains chefs like Michel Bras and Alain Ducasse in everything from the use of carrageenan and seaweed extracts to sous vide. Goussault's team of seven engineers also develops products for companies like Nestlé, and it tests equipment for manufacturers, like a new oven that can go from 200 degrees Fahrenheit to 500 degrees in less than three minutes. Even though many chefs in France use sous vide in their restaurants, it had long been considered a technique suitable only to chains and factories. The fact that some old-guard French chefs like Alain Senderens, Paul Bocuse and Joël Robuchon have signature lines of sous vide convenience foods in supermarkets has not helped to remove the stigma. A television news report in the mid-90's revealed that the French restaurant chain Chez Margot was cooking some of its entrées sous vide; it went bankrupt soon after. ''Joël Robuchon is the only chef who openly admits he uses it,'' Goussault said. ''One member of Le Club des Cents'' -- an esteemed gastronomy club -- ''said that any chef who uses sous vide is a fraud.'' Indeed, when I interviewed Senderens recently, he initially denied using sous vide in his kitchen at Lucas Carton, his three-star restaurant in Paris. But when I mentioned that the cooks at Le Meurice, a nearby up-and-coming restaurant, were using sous vide to prepare more than 50 items on the menu, Senderens suddenly remembered that he does use sous vide at Lucas Carton -- but only for the chicken with truffles. Even in America, where there are fewer such prejudices, sous vide has taken more than two decades to gain acceptance. In 1988, just when Cuisine Solutions, then called Vie de France, and a few chain restaurants were gearing up their sous vide operations, The Washington Post published an article questioning the safety of sous vide and other food-storage techniques like modified-atmosphere packaging, which were new at the time. Although sous vide was legal to use, the Food and Drug Administration has always warned of its potential dangers in restaurants. Still, sous vide is part of the F.D.A.'s Food Code, and any manufacturer who wants to use it can get permission by applying to the U.S.D.A. Chipotle, a burrito chain backed by McDonald's, now cooks all its braised pork sous vide. There may be hope for airline food yet. n high-end restaurants, sous vide began as a rarefied curiosity. Sous vide machines cost $3,000 to $6,000; thermal circulators start at $1,200; and staff training by Goussault runs $2,000 a day for a minimum of four days. David Bouley, who learned from Pralus, was one of the first American chefs to use sous vide at his restaurant, then called Bouley Bakery. Shea Gallante, the chef at Cru in New York City, who then worked for Bouley, admitted, ''At the time, no one was really sure how it worked.'' Thomas Keller, who has done work with Cuisine Solutions for a sous vide product line, has had Goussault train the kitchen staff at both the French Laundry, his signature restaurant in Yountville, Calif., and Per Se, in New York. Two years ago, Michael Anthony at Blue Hill contacted Goussault to learn more about the technique. Since then, word about Goussault has spread among American chefs. Recently, Fabio Trabocchi invited Goussault to spend four days training his team at the Ritz-Carlton in Washington. Sous vide has reached the stage where the art must now catch up to the science. While industrial food companies use sous vide primarily for braising -- where all of the ingredients are in the bag -- chefs are beginning to see it as a way to prepare and manipulate individual ingredients, sometimes without even cooking them. And, naturally, they are using much higher quality ingredients, so the results are quite different from what you might get, say, on American Airlines. If you go to Cru and order Gallante's Wagyu beef, it will be unlike any piece of beef from a saute pan or broiler. Instead of a brownish rim and increasing redness toward the center, it will be evenly rare from the outer edge all the way through. At Per Se and the French Laundry, cooks are using sous vide to compress peaches, cucumbers and tomatoes. They've found that compressing celery has the same effect as blanching it and therefore saves them a step. ''Pineapple is extraordinary,'' Keller says. They're also using it to infuse oils and slow-cook pig's head. Chefs have found less lofty ways to employ the technique as well. At CityZen, in the Mandarin Oriental hotel in Washington, they make ice cream bases in sous vide. ''There's no putting your sugar and egg and cream in a pan and stirring,'' says Eric Ziebold, the chef. His pastry chef blends the ingredients, seals them in a bag and cooks it in water. ''More than anything, the vegetables and the proteins taste remarkably more like themselves,'' Dan Barber, the chef and owner of Blue Hill, wrote in an e-mail message. ''When it comes to things like artichokes, steaming and boiling and braising are fine, but there's a great loss of liquid as it cooks -- which is another way of saying a great loss of flavor because the juice of the artichoke itself, while mostly water, is very flavorful. Sous vide eliminates this loss, and hence the sensation that you're tasting a true artichoke -- not just a delicious artichoke, but an artichoke the way it was intended to taste.'' Much is made of the artistry of chefs, but running a restaurant kitchen well often has more to do with control and consistency. And in large kitchens or multiple restaurants, those things can get out of hand pretty quickly. Alléno, the chef at Le Meurice, oversees 72 cooks; Daniel Boulud has a staff of 65 to 70 among his three New York restaurants. Most cooking relies on the cook's ability to judge doneness based on sight and feel. With sous vide, it is all about precise times and temperatures. ''You can have your restaurant 6,000 miles away,'' Ziebold says, ''and you don't have to worry about the cooks at your restaurant in D.C. getting the duck right because they're cooking it sous vide and they know the temperature.'' Every year, Janos Kiss, the corporate executive chef for Hyatt Hotels and Resorts, prepares a dinner for more than 5,000 people on Super Bowl weekend. It used to take 20 chefs four days to cook the dinner. Now, with sous vide, they do it with six chefs in two days. In the long run, sous vide's great contribution may well be this consistency. A chef with a restaurant empire, like Nobuyuki Matsuhisa, may finally be able to guarantee that the lobster with wasabi-pepper sauce at Nobu in London is every bit as good as the one at Nobu in New York. It may spell the end to bad wedding food. And if it catches on at companies from Stouffer's to Whole Foods, it could forever alter the state of convenience food. In the meantime, all the attention being paid to temperature and laboratory precision has pushed chefs in more creative directions. When Grant Achatz built his new restaurant Alinea in Chicago, thermal circulators from PolyScience, a laboratory-equipment manufacturer, were part of the kitchen design. To these, he has added a 40,000-r.p.m. homogenizer (what Philip Preston, the president of PolyScience, calls a ''coffee grinder on steroids'') -- for making the world's most emulsified vinaigrettes and confections like carrot pudding made with carrot juice, cocoa butter and grapeseed oil -- and an entirely new mechanism they're calling the Antigriddle, which has a surface that chills to minus 30 degrees Celsius (minus 22 Fahrenheit), allowing you to freeze food in the same way you would saute it. A dollop of sour cream becomes brittle on the bottom and stays at room temperature on top. For all chefs' forward thinking, though, top kitchens still run on frat-house principles. So sous vide also comes in handy for hazing new cooks. At WD-50, Dufresne said, ''I've seen virtually every kind of personal belonging end up in one of these bags.'' Veteran cooks are known to take a new cook's clothing from his locker and put it through the sous vide machine, compressing his jeans and shirt to the size of hockey pucks. In late July, Goussault went to Citronelle in Washington for a follow-up training session with Michel Richard's head cooks, David Deshaies and Cedric Maupillier. They were having trouble with the salmon and sweetbreads done sous vide. The salmon had a perfect silky texture but was too fragile and, they worried, undercooked. And the sweetbreads were losing too much liquid. Goussault is often called in to help chefs perfect their technique. ''My job is to repeat, repeat, repeat,'' he says. He unpacked his briefcase, removing a laptop, a box of batteries, a jumble of wires and a number of handheld monitors that, when hooked up to the foods with probes, can record their minute-to-minute temperature arc during the cooking process. The large stoves around the kitchen were mostly unoccupied. Two thermal circulators sat poised on a steel countertop, humming like Jacuzzis. Deshaies dropped two pieces of salmon in ice water that contained 10 percent salt, then set a timer for 10 minutes. Salt, according to Goussault, ''modifies the osmotic pressure in the cells,'' meaning it prevents the albumen, that white substance, ghastly to chefs, that gathers on the surface of fish, from leaching out of the salmon when it cooks. They sealed the salmon in sous vide and inserted probes. It now looked as if the salmon had a heart monitor. For meats and fish, there is a window of doneness between 52 degrees Celsius (about 125 degrees Fahrenheit) and 62 degrees Celsius (about 144 degrees Fahrenheit). Below 52, you risk bacteria. Above 62, you begin denaturing proteins. Goussault then put one piece of salmon in a thermal circulator set at 56 degrees Celsius and one set at 53 degrees Celsius to see if they could raise the final internal temperature to 54 and 50 degrees respectively without changing the texture they had achieved in the piece they had cooked to 47 degrees. Food cooking in a thermal circulator looks a bit like an animated version of a Damien Hirst sculpture -- abstract animal parts suspended in a vibrating liquid. Standing over his cutting board, Deshaies said, ''Some chefs the other day, they said to me: 'What? So you put it in the plastic and put it in the water and that's it?' '' He shook his head. ''It's not so easy.'' It takes practice to get the sous vide machine to seal correctly. Foods must be chilled before sealing, otherwise the pressure inside the machine will cause them to cook during the sealing process. The pressure must also be calibrated for every type of food, so the food stays compact but firm. Once the food is sealed, its proper cooking temperature and internal temperature must be determined. Citronelle's lamb loin, for instance, is first infused with garlic in a sous vide pouch, then it is sauteed, chilled, resealed in sous vide and cooked in a thermal circulator at 60 degrees Celsius until its internal temperature reaches 56 degrees. It is then cooled at room temperature, in cold water, then further cooled in ice water, then chilled until an order comes in, at which point it is reheated in a warm water bath, still in its sous vide bag. As Barber at Blue Hill explained: ''If you're patient, and you try different temperatures and different times, at some point you'll achieve a taste from the product that's better than it's ever tasted before. I'm not exaggerating. That's happened to me with nearly everything, almost never the first time I try it, but over time and with experimentation, that's the reward.'' After 40 minutes or so, the pieces of salmon registered at 50 degrees and 54 degrees. Each was removed from the hot water, and cooled systematically. It was time to taste. On three plates, Deshaies lined up the pieces of salmon, including the one cooked the day before to 47 degrees. All three pieces were pink all the way through and glistening with moisture, a consistency unlike that of any piece of salmon cooked in an oven. The piece cooked to 54 degrees was dismissed as ''airplane food.'' Deshaies and Maupillier preferred the fish they had cooked to 47 degrees, a temperature that Goussault insisted was unsafe. The salmon cooked to 50 degrees was a good compromise, moist and delicate, but without any signs of rawness. Goussault seemed tense. He had recently done a similar experiment with Thomas Keller's team at the French Laundry, and he now explained that Keller had also preferred the 47 degree salmon. ''Like us!'' Deshaies said. ''But his sous-chef feels the difference between 47 and 50 is too little and 50 is safer,'' Goussault said. He then added: ''His is different. He does it with olive oil. Delicious.'' For Deshaies, it was suddenly no longer about science. He shot a concerned look at Richard. ''We can do that, too,'' he said.

Subject: Meanwhile, People Starve From: Emma To: All Date Posted: Sun, Aug 14, 2005 at 10:01:30 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2005/08/14/opinion/14sun2.html Meanwhile, People Starve Were it not for Hilary Andersson, a BBC television journalist, Niger's starving people would very likely be getting as little attention as the starving citizens of nearby Mali, Burkina Faso and Mauritania. Her wrenching report from Niger, where more than three million people are now in danger of starving to death, set off a worldwide aid effort that a year of United Nations warnings could not. Had attention been paid sooner, lives could have been saved, at one-eightieth - that's right, one-eightieth - what it will cost today. And easy, affordable steps that could prevent such scenes elsewhere, like a proposed United Nations $500 million emergency response fund, haven't been taken. Niger, one of the world's poorest countries, has long lived at the mercy of an unforgiving climate, and the destruction of last year's crops through drought and crop-eating locusts is the main cause of its present plight. The usual contributors to famine elsewhere, like war, dictatorship or crackpot economic theories, are notably absent. Niger's government is democratically elected and President Mamadou Tandja's orthodox budget-balancing and market-opening policies are regularly praised by Western leaders and international lenders. Regrettably, Mr. Tandja has an unhealthy tendency to take that orthodoxy too far, to his people's detriment. In April, with the famine already gathering force, he imposed food tax increases as part of a budget-balancing package. Amid widespread protests, he later backed off. But in an interview with the BBC last week, he insisted that his people 'look well-fed' and that reports to the contrary were 'false propaganda' being spread by aid agencies to attract funding. For the historically minded, his bizarre insensitivity to his people's suffering evokes parallels with Ireland's deadly famine of more than a century and a half ago, where the rigid laissez-faire ideology of the ruling British authorities made the bad problem of a failed potato crop needlessly worse. Then, locally grown grains were sold abroad for profit while millions of Irish peasants were allowed to starve. Today, market stalls in Maradi, a major trading center of Niger, are piled high with food for the few who can afford it, while elsewhere in the same city thousands of starving and desperate people jostle for scarce relief supplies. The Nobel Prize-winning economist, Amartya Sen, has taught, rightly, that 'no famine has ever taken place in the history of the world in a functioning democracy.' Functioning is the key word; leaders who are truly accountable to their people have strong incentives to take timely preventive action. Mr. Tandja, whom President Bush hailed at the White House this June as an exemplary democrat, clearly needs a refresher course in humane economics and accountable democracy.

Subject: Functioning Democracy in Africa From: Mik To: Emma Date Posted: Wed, Aug 17, 2005 at 09:36:42 (EDT) Email Address: Not Provided Message: Emma, I don't know much about Niger as my expertise is in English and Portuguese speaking Africa. My first thought (which could be wrong) on the principle of 'Functioning Democracy' in Africa is unfortunately very cynical (here we go again - but I will end off with a positive example this time). Most 'democracies' in Africa are NOT true functioning democracies. Not even South Africa which saw open and fair elections with a change of president. Africa is (in general) still run by tribes. And people vote in their tribal leaders. For this reason, no matter how bad the leader may be, he will still be voted in because he represents the majority tribe. In Uganda we saw something interesting. The majority tribe is located in the North of the country and are Idi Amin supporters (that is how Idi Amin came to power in the first place). There are two more tribes in the South and the people in the south realised that by coming together they are a majority. So they vote for Museveni (who is the current president of Uganda). They will always vote for Museveni because he will represent their tribes (and they don't want to be ruled by any other tribal leader). Luckily a lot of these leaders are behaving themselves due to international pressure. But they slip up every so often as it appears in Niger. In South Africa, the majority tribe is the Xhosa and the most feared tribe is the Zulu. The Zulu tribe has their own political representation, but the remaining tribes vote along with the Xhosa tribe for the ANC. And we can be sure that the ANC will remain in power for as long as the population of Xhosas is the largest (which appears to be forever). We hope that with time and improved education, tribal links will diminish and more pure democracy will flourish. Now for the positive side: There is one country in Africa that is truly democratic. In fact it is the oldest democracy in Africa and actually the most succesful country in Africa.... Botswana. This country with a mere 1.4 million people has only one tribe. So competing politicians are evaluated on their political strength, not tribal relation. For a country that is almost entirely desert, has to import most of its water and import all its electricity, they are not only per capita the richest but the most progressive country in Africa. They are actually the true model for Africa's future. So when done properly, democracy works well.

Subject: Re: Functioning Democracy in Africa From: Emma To: Mik Date Posted: Wed, Aug 17, 2005 at 10:19:41 (EDT) Email Address: Not Provided Message: Excellent analysis. These comments are most important; I will discuss them further today. By the way, we should watch for adverse effects from rising oil prices in southern Africa.

Subject: Arithmetic of Mutual Fund Investing From: Emma To: All Date Posted: Sun, Aug 14, 2005 at 07:47:42 (EDT) Email Address: Not Provided Message: http://www.vanguard.com/bogle_site/sp20050524.htm The Arithmetic of Mutual Fund Investing is More Important Than Ever Remarks by John C. Bogle Founder and Former Chairman, The Vanguard Group American Association of Individual Investors Philadelphia Chapter It's a delight for me to meet once again with the Philadelphia Chapter of the American Association of Individual Investors. These are clearly troubled times in our markets, in our nation, and around our globe, but their place in history is yet unknown. It is a curious coincidence that my two previous visits with you happened to come at crucial inflection points in stock prices—the first near a market low that preceded a huge upsurge; the second immediately before a market high that preceded one of the two biggest declines in the past seventy years.* It was on September 27, 1988, when I first visited with you. The stock market was still suffering the aftershock of its stunning one-day decline of 22 percent on 'Black Monday,' October 19, 1987. I urged you to ignore a story that had just appeared in TIME magazine with the headline, 'Buy Stocks? No Way!' that described the stock market of the day as 'a dangerous game.' Then, the Dow Jones Industrial Average was at a level of 2,080; stocks were selling at 12 times earnings; and it took no brilliance at all to urge you to continue to own stocks and 'stay the course.' On November 23, 1999, I met with you again. Then, the stock market bubble was approaching its peak, which it reached only a few months later. The Dow was at 11,000, stocks were selling at an astonishing 32 times earnings, and again it took no brainpower to forecast that stock returns over the decade ahead would likely average no more than 7 percent per year. While in 1988 I had urged you 'not to get carried away with pessimism,' in 1999 I urged you 'not to get carried away with optimism.' In both cases, I suggested that a carefully balanced asset allocation between stocks and bonds would enable you to 'stay the course' no matter what might lie ahead. What to Do Today? Despite the 'tradition' of my two prior visits, I do not see today's stock market as having reached an inflection point. It is neither at the bargain basement extreme we witnessed in 1988, nor at the bubble-bursting extreme it reached before the 2000 high. The Dow was to ease upward to 11,700, then drop to 7,290, and recover to today's level of 10,460. With stocks now selling at about 20 times earnings, price-earnings ratios seem high, but not alarmingly so. Importantly, based on the methodology said to be used by Federal Reserve Chairman Alan Greenspan, stocks seem quite fairly valued when compared to bonds, the principal investment alternative. The 'Fed Model' compares the relationship of the current earnings yield on stocks (the reciprocal of the p/e ratio; a p/e of 20 represents an earnings yield of 5 percent) with the interest rate on the 10-year U.S. Treasury bond. Today, the earnings yield of 5 percent is almost 20 percent above the bond yield of 4.1 percent, while in 1988 it was slightly lower. In late 1999, however, the earnings yield of 3.4 percent was only about half of the bond yield of 6.3 percent. The higher apparent equity premium today might suggest that stocks today are substantially more attractive than they were in 1988. However, I simply don't believe that, for at least three reasons: One, corporate earnings may be under pressure over the next few years, raising P/Es and reducing the earnings yield. Two, bond yields may, and I believe will, rise, though when the rise may come and how much it may be is totally problematical. And three, we live in an especially uncertain world, facing threats of unbridled deficits in our federal budget and our balance of payments, national disunity, and the ever-present threats of terrorism, nuclear proliferation, and global warming. To me, these concerns do not require that you abandon your own investment policy; but I would urge you to (as I do personally) lean toward the conservative side.' The Simple Arithmetic of Financial Market Returns What lies ahead for stocks and bonds? As we look to the future, the most important thing to remember is that in the long run what drives the returns on financial investments are the relentless rules of humble arithmetic: For stocks, the investment return is driven by a simple combination of the initial dividend yield on stocks plus the rate of future earnings growth, the fundamental factors of investment that have accounted for 10 percentage points—5 percent dividends and 5 percent earnings growth—of the 10.2 percent of the long run return on stocks—nearly 100 percent. In the short-run, however, it is not investment, but speculation that calls the tune. When the price-earnings ratio rose from 16 times to 32 times during the 1990s—a 100 percent increase—that change in investor sentiment alone added fully 7 percent per year to the investment return of 10 ½ percent in that glorious decade of speculation, bringing the total return to a robust 17.8 percent. But with today's dividend yield of a meager 2 percent and future earnings growth assumed to be equal to the long-term average of 5 percent, we might be looking at future annual stock returns of only about 7 percent. (If the p/e multiple rises from 20 times to, say, 22 times, add a percentage point, if the p/e declines to 18 times, subtract one point; two points if it declines to 16 times.) Yes, I realize that the long-term return on stocks has averaged much more than that, but that 10 percent annual historical return was buttressed by a 5 percent dividend. So today's dividend yield of about 2 percent results in a dead-weight loss of 3 percentage points a year in the potential return. While the investment fundamentals of earnings and dividends drive historical stock returns over the long-run, past returns on bonds tell us nothing about the future. But the bond arithmetic is even easier and more reliable. The present bond yield tells us nearly all that we need to know, for the best single predictor of the future returns on bonds is today's bond yield. With the 10-year Treasury a hair over 4 percent and long-term corporates at about 6 percent, let's assume (perhaps generously) a future return on bonds of about 5 percent on a diversified corporate/government bond portfolio. While no one can be certain, it seems reasonable, then, to expect stocks to deliver a return of 7 percent more or less over the coming decade, representing a 2 percentage point equity premium over the roughly 5 percent that bonds are likely to deliver. After a two-decade run in which (a) stocks delivered 13 percent (even including the disappointing returns of the past five years), largely because of the extra one percentage point arising from the higher dividend yield; and the 4 percentage points that came from p/e expansion; and (b) bonds delivered a return of about 8 percent (which was, after all, the bond yield at the outset), these returns may seem disappointing. Nonetheless, this simple but compelling arithmetic is what we must deal with in establishing reasonable expectations regarding future returns in the financial markets—returns that, in my judgment are almost certain to be well below the returns of the 1980s and 1990s, when we literally 'never had it so good.' The Simple Arithmetic of the CMH Sadly, when we describe our rational expectations for future returns in the financial markets, we are implicitly concealing the central fact of investing. As a group, investors never—never!—enjoy the gross return that the markets deliver. Investors earn the net return, after all of the costs of our system of financial intermediation. Thus, just as gambling in the casino is a zero-sum game before the croupiers rake in their share (I'm told that this is called 'vigorish,' or 'the vig') and a loser's game thereafter, so beating the stock and bond markets is a zero-sum game before intermediation costs, and a loser's game thereafter. The reality is that the mutual fund croupiers rake huge sums off the stock market table. Just consider the annual costs incurred by the investor in the average equity fund: (1) Management fee 0.9 percent, plus other expenses 0.6, for a total expense ratio of 1.5 percent. (2) Hidden portfolio transaction costs of at least 0.8 percent (the average fund turns its portfolio over at an astonishing 100 percent per year, meaning that a $5 billion dollar fund sells $5 billion of stocks every year and reinvests the proceeds in another $5 billion, $10 billion in all). (3) Sales commissions on load funds, about 0.7 percent (a 5 percent commission, spread out over, say, seven years). Total: 3 percent per year.** Most of you are likely familiar with the EMH—the Efficient Market Hypothesis—that suggests that most stocks are fairly valued, most of the time. But the relentless rules of humble arithmetic remind us of something both more certain and more profound than the EMH. I call it the CMH—the Cost Matters Hypothesis—the iron rule that investors as a group must always lose to the stock market by the amount of the costs they incur. The Simple Arithmetic of Fund Expenses and Taxes When we examine the record of the past two decades, the relentless rules of humble arithmetic have clearly proven dangerous to the wealth of most families who have entrusted the responsibility for overseeing their hard-earned assets to mutual funds. That humble arithmetic—gross return, minus cost, equals net return—has destroyed their wealth in almost precisely the measure that our CMH suggests. Investors have learned, and learned the hard way, that in mutual funds it's not that 'you get what you pay for.' It's that, almost tautologically, 'you get what you don't pay for.' Let's look at the record. Over the past 20 years, a simple, low-cost, no-load stock market index fund delivered an annual return of 12.8 percent—just a hair short of the 13.0 percent return of the market itself. During the same period the average equity mutual fund delivered a return of just 10.0 percent, less than 80 percent of the market's annual return. It is no accident that this shortfall of 2.8 percentage points per year, arose largely from those estimated annual costs of about 3.0 percent presented moments ago. Compounded over that long period, each $1 invested in the index fund grew by $10.12—the magic of compounding returns—while each $1 in the average find grew by just $5.73, not 80 percent of the market's return, but a shriveled-up 57 percent—a victim of the tyranny of compounding costs. The magic, alas, is overwhelmed by the tyranny. (The fund industry, of course, focuses on the former and is tight-lipped about the latter.) And that's before taxes. Because of the shocking tax inefficiency engendered by its astonishingly high (100-percent-plus) portfolio turnover, the average managed equity fund cost its taxable investors another 2.2 percentage points in taxes, producing not 57 percent of the market's annual return, but only 41 percent. With the index fund relinquishing only 0.9 points in taxes, the gap between the equity fund and the index fund rises from 2.8 to 4.1 percentage points per year. The average fund deferred almost no gains during this period; the index fund deferred nearly all. (Deferred taxes may be the ultimate example of how you get what you don't pay for.) But the arithmetic gets even worse. For the wealth accumulated in the index fund and the average equity fund should be measured not only in nominal dollars, but in real dollars. When we reduce both returns by the inflation rate of 3.0 percent, the real annual return drops to 8.9 percent for the index fund and to 4.8 percent for the equity fund. That obviously leaves the 4.1 percentage-point gap unchanged. But the compounding of those lower annual returns further widens the cumulative gap. Over the past twenty years, the cumulative profit of each $1 initially invested in the managed fund came to just $1.55 in real terms, after taxes and costs, only 34 percent of the real profit of $4.50 on the index fund. The index fund actually increased your capital by 190 percent! The Simple Arithmetic of Income Expropriation The impact of costs and taxes on mutual fund total returns, however, substantially understates their profound impact on investors. While funds are inordinately tax-inefficient when it comes to capital gains, they are remarkably—and perversely—tax-efficient when it comes to dividend income. Why? Because about 85 percent of the yield of the average equity fund is 'taxed,' as it were, by mutual fund fees and expenses, leaving only 15 percent of the dividend income to be distributed to equity fund investors and taxed by our federal and local governments. Shocking as that may sound, the mathematical reality is that when we deduct equity fund expense ratio of 1.5 percent from today's 1.8 percent dividend yield on stocks, all that remains is a puny net dividend yield of 0.3 percent for the fund owner. There are two simple ways to avoid this confiscation of your income. One way is to do your equity fishing in the low-cost pond. The ten percent of funds with the lowest expense ratios (averaging 0.3 percent) consume 'only' 20 percent of income. (Conversely, the highest-cost ten percent, with expense ratios averaging 2.5 percent, actually consumes 225 percent of those funds' income.) The other way is to own a low-cost stock market index fund, whose costs of as little as 0.1 percent consume a mere 7 percent of its income, leaving 93 percent for you. In the case of bond funds, of course, income is a much more significant factor. A bond fund's net yield typically accounts for about 100 percent of its long-run return. Yet the expense ratio of the average bond fund (0.8 percent) consumes almost 20 percent of its gross yield of 4.5 percent, reducing it to a net yield of 3.8 percent. Further, these numbers substantially understate the confiscatory nature of costs, for most bond funds carry hefty sales commissions. If you pay a 4 ½ percent front-end load to acquire a bond fund, it eats up more than 100 percent of your first year's net income. The way to maximize your income in bond funds is to rely on the same simple arithmetic as in stock funds: either own only low-cost bond funds, where 7 percent of the yield is consumed by expenses, leaving 93 percent for you (and buy no-load funds rather than paying that hefty 4 ½ percent load for the privilege of having your income depleted); or, better yet, own a no-load bond index fund, where, after the deduction of only about 1/10 of 1 percent for expenses, 97 percent of the income goes to you. While today we don't read much about money market funds, the same simple arithmetic applies. The high cost funds eat up 38 percent of your income, and the low cost funds consume just 8 percent. (While there are no indexed money market funds, it's fair to say that almost all money market funds are virtual index funds. Commodity-like, they almost uniformly earn the average returns in the money markets, and deliver returns to investors that are largely differentiated by their costs.) Yet investors in high cost money market funds seem perfectly happy to accept a 1.6 percent yield when a 2.4 percent yield—fully 50% higher—lies there for the taking. But only for those who are willing to do the simple arithmetic. The Simple Arithmetic of Hedge Funds When the outlook for returns on stocks and bonds is as subdued as I have suggested today, it's especially tempting to reach for higher returns by seeking out other kinds of investments. Yet looking for 'something better' than stocks and bonds implies that there is something better. Is there? Today's 'big new idea' for gaining extra returns is 'alternative investments,' although, in fact these alternatives are just stocks and bonds of a different character and mix, boxed in a different and more expensive package. But I wonder if their popularity isn't simply the inevitable reaction of investors (and brokers) who, after one of history's great bear markets, want to buy (or sell!) something new. Hedge funds, of course, are the talk of the town. But please don't forget that many individual hedge funds are taking risks, often hidden, that would send chills up and down one's spine. (Think of the failure of Long-Term Capital Management; think of the 700 hedge funds that reportedly folded last year.) Further, when hundreds of billions of dollars flow into hedge funds, their managers chase an increasingly limited supply of market inefficiencies, and the value to be added by hedging strategies is apt to get arbitraged away. As yesterday's successful managers are flooded with money, their growth virtually precludes their repeating past achievements in the future. What is more, those past achievements of hedge funds have been overrated. A recent study showed that the average hedge fund earned a return of about 9.3 percent per year in 1995-2003, slightly less than the stock market return of 9.4 percent, and more relevantly, less than the 10.1 percent return on a conservative stock/bond balanced fund (which happened to be slightly less volatile). As to the future, simple arithmetic again can help us in evaluating potential hedge und returns. If the stock market were to deliver a 7 percent return in the future, the investor, in a low-expense, tax-efficient index fund, would likely realize a net after-tax return of about 6.2 percent. Even if we grudgingly assume that a hedge fund were to earn 10 percent—no mean task in the tough environment ahead—it would deliver only 4.8 percent, only two-thirds of the net return on the simple index fund. Why? Because the managers would take 2.8 percent (1 percent plus 20 percent of the total return), and taxes (for an investor in the 33 percent tax bracket) could come to an additional 2.4 percentage points, a total reduction of 5.2 percentage points in the 10 percent gross return. The risk of selecting the right hedge fund is huge, and while the popular hedge-fund-of-hedge-funds diversify that risk, they are even more costly. The simple arithmetic of hedge funds—even if you are lucky enough to pick a winner—suggest that their high costs and high taxes will result in inadequate net returns to their investors. My conclusion: nearly all individual investors should join me in resisting succumbing to the siren song of these over-rated hedge fund temptresses. The Simple Arithmetic of Exchange-Traded Funds There's another investment product that has recently caught the eye of the fanciful investing public: the exchange-traded fund, or ETF. These funds are generally low-cost index funds that can be traded in the stock market just like regular stocks. As one advertisement for the Standard and Poor's 500 ETF (the 'Spider', in the lingo of the financial community) says, 'Now you can trade the S & P 500 all day long, in real time.' Leaving totally aside for the moment the question of why anyone in his right mind would want to do that, the simple arithmetic of investing suggests that most investors should ignore this so-called opportunity. As you must know, I love index funds that track the S&P 500 and total stock market. But not as trading vehicles; as vehicles for owning the stock market at low cost and high tax efficiency and holding it, well, forever. But most investors in ETFs seem to be following, not my advice, but the advice in the Spider ad. The share turnover of Spiders during the past year came to a cool 4,536 percent, meaning that the average share was apparently held for a period of less than one day! But as suitable as ETFs may be for long-term investors, they are totally unsuitable for rapid fire traders. Why? Because of costs. Let's take a look at the simple arithmetic of ETFs, and make a few highly conservative assumptions: 1) an investor buys, and later sells 100 shares of the Spider (approximately $12,000; with its bargain basement expense ratio of 0.11 percent (other ETFs can be three or four times as costly to operate). 2) he pays a minimum commission of $35 for each transaction (lower if done electronically, higher if done over the phone); 3) he goes in and out of the Spider (a) twice a year (turnover 200 percent), (b) five times a year (500 percent), or (c) once a month (1200 percent, but still a far cry from the 4,000-plus percent average turnover). The investor's total annual costs, respectively, would then take 1.3 percent, 3.0 percent, and 7.1 percent from his annual return—repeated over time, a large dent! If the investor can successfully time these trades, he may be able to make up these deficits; if not, which is much more likely, he will lose even more than those costs. Only long-term holders are certain to benefit from the glitteringly low expenses of most ETFs. The traders that ETF sponsors appeal to in their ads are destined to be playing a loser's game, all because of the relentless rules of the humble arithmetic of the markets. Simple Arithmetic—Wrapping Up Whether we look at future market returns in the financial markets, or the Cost Matters Hypothesis, or the real world of fund expenses and taxes, or maximizing income, or the superficial appeal of hedge funds and the foolishness of trading ETFs, we are left with one certain conclusion: investors who ignore costs are courting failure; investors who control costs are maximizing their chances of success. The long-term differences in the wealth they accumulate will be truly staggering. Why? Because for the former group, the magic of compounding returns is overwhelmed by the tyranny of compounding costs; for the latter group, the magic of compounding returns stands almost on its own. When the arithmetic of investing suggests lower returns in the financial markets in the years ahead, the ability to capture the fair share (up to almost 100 percent) that you deserve will be more important than ever. Low cost funds—and of course index funds—are the best way to get your fair share. But don't take my word for it. Ask Warren Buffett. Ask his mentor, Benjamin Graham. Ask Jack Meyer, the remarkably successful wizard who tripled the Harvard Endowment Fund from $8 billion to $27 billion. Here's what Mr. Meyer had to say: 'Most people think they can find managers who can outperform, but most people are wrong. 85 percent to 90 percent of managers fail to match their benchmarks. Because managers have fees and incur transaction costs, you know that in the aggregate they are deleting value. The investment business is a giant scam.' When asked, 'can private investors draw any lessons from what Harvard does?' Mr. Meyer answered: 'Yes.' He then recounted the lessons. 'First, get diversified. Come up with a portfolio that covers a lot of asset classes. Second, you want to keep your fees low.' That means avoiding the most hyped but expensive funds, in favor of low-cost index funds. No doubt about it. And finally, invest for the long term.' In a sense, Mr. Meyer is simply stating the obvious: the all-market index fund and the Standard & Poor's 500 Index fund are far better ways to invest than searching through a seemingly-endless list of the products of the marketing-driven, asset-gathering machine that today's mutual fund industry has become. A small minority of managed equity funds may approach that simple ideal, and certainly some few will surpass it. But the odds in favor of success, as I've shown you this evening, are terrible. If that's not enough, ask any economist who's won the Nobel Prize. And if that's not enough, just use your common sense to think through what I've just said. Successful investing is pretty simple. Just do a few simple things right, and avoid making stupid mistakes. Such as thinking that you know more than the market does; investing on impulse, buying on tips, believing that past success repeats itself in the future; and letting your emotions overwhelm your reason. Four Essential Rules Let me close with four essential rules that wise investors, whatever strategy they pursue, should follow: First, pare costs to the bone. Realize that in investing you get what you don't pay for. Whatever future returns the stock and bond markets are generous enough to deliver, few investors will succeed in capturing 100% of those returns, simply because of the high costs of investing—all those commissions, management fees, investment expenses, yes, even taxes. Second, diversify. Own American business and hold on to it. Not one company or industry, but a broadly diversified portfolio of lots of companies and industries. Buy such a portfolio, never sell, and hold it forever. No one knows what stocks will do tomorrow, or even what they'll do over the next decade, but over the long pull the dividends and earnings growth of American business will be reflected in rising stock prices. Third, don't forget to allocate your assets prudently between stocks and bonds. As the years roll on, we have more wealth at stake, less time to recoup losses, and begin to rely on our investments to provide income. Each of these critical factors suggests that, as investors age, we should own even larger bond portions. (A rule of thumb: begin with the idea that your bond percentage should roughly be equal to your age.) Fourth, don't do something, just stand there. Stay the course. Once you get your costs down, your stocks and bonds diversified, and your stock/bond balance right. Not only expenses, but emotions, are the investor's greatest enemy. It may take courage and wisdom, but 'Stay the Course' remains the name of the game. Thank you. * The speeches I gave to AAII on those two dates are included in my 2001 book, John Bogle on Investing, The First Fifty Years. ** I've used the unweighted average expense ratio, higher than the asset-weighted ratio of 1.1 percent. But I've ignored out-of-pocket costs, penalties on early redemption of fund shares, and opportunity cost. (Most equity funds are about 95 percent invested in stocks, thus diluting the market's long-term return premium.)

Subject: Paradise and Money Lost From: Emma To: All Date Posted: Sun, Aug 14, 2005 at 07:22:38 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2005/08/14/business/yourmoney/14hedge.html Paradise and Money Lost By JULIE CRESWELL ON Feb. 24, Ronald S. Kochman hurried out of the elevator onto the 17th floor of an office tower in West Palm Beach, Fla., that KL Group, a hedge fund advisory firm, called home. Normally bustling with activity, the place was eerily quiet that morning as Mr. Kochman strode past the elegant conference rooms toward his destination: the corner office of Won Sok Lee, one of the firm's principals. Two days earlier, Securities and Exchange Commission officials had unexpectedly visited KL's offices, demanding to see documents. Now some employees were reporting that Mr. Lee was missing - along with nearly all the money in the firm's accounts. Mr. Kochman, a prominent trust and estate lawyer in the Palm Beach area, had much to lose. Not only had he sunk his savings, about $4 million, into the funds, but he had also put his reputation on the line by urging his own clients to invest with KL, where he had become a principal early last year. So when someone with keys to Mr. Lee's office asked him why he wanted to go in that morning, a tearful Mr. Kochman collapsed on his knees and said, 'It's gone. It's all gone,' according to a person who witnessed the event. 'The money is missing and Won has jumped ship.' Today, the S.E.C., the Justice Department and a court-appointed receiver are still trying to unravel what happened. Investigators now say they believe that more than $200 million of investors' money has vanished, possibly making this one of the largest hedge fund frauds ever. In March, the S.E.C. sued Mr. Lee and two brothers, John and Yung Bae Kim, accusing them of securities fraud. While the funds' managers blinded investors with records showing supposedly dazzling returns, the money was actually being frittered away in bad trades or simply stolen, according to the court-appointed receiver, the law firm Lewis Tein. Mr. Lee and Yung Kim have disappeared, and John Kim, who is cooperating with the investigation, denies any knowledge of wrongdoing. 'These guys were slick. They would have given Barnum & Bailey a run for their money,' said Guy A. Lewis, a partner at Lewis Tein and a former United States attorney for the Southern District of Florida who, in the early 1990's, helped to prosecute Gen. Manuel Antonio Noriega of Panama. 'This wasn't just a straight fraud. It was hocus-pocus, smoke and mirrors.' THIS much is known: Three years ago, Mr. Lee and the Kim brothers opened a hedge fund advisory business in Palm Beach, one of the nation's wealthiest enclaves. Driving flashy cars and living lavish lifestyles, the three principals - all Korean-born Americans in their mid-30's - befriended the right people, who provided them with access to society functions and introductions to their wealthy clients. The aura of success and exclusivity around the firm was so strong that investors often begged to be let into its funds, some of which were said to have astounding annualized returns of 125 percent for several years. Among the funds' 225 investors were some of Palm Beach's elite, including Jerome Fisher, the founder of the Nine West shoe store chain; Carlos Morrison, an heir to the Fisher Body automotive fortune; and golf pros Nick Price and Raymond Floyd, according to people who have seen lists of investors. While Palm Beach is still abuzz about the collapse of KL, few investors want to acknowledge that they were caught up in the frenzy. Donald J. Trump, who owns several properties in the area, said in an interview that he had been contacted about investing in the fund but didn't because he thought the returns were too good to be true. 'These guys duped a lot of people down in Palm Beach, smart people with lots of money,' Mr. Trump said. 'These people feel they were conned, and they're embarrassed. They just don't want to talk about it.' The investigation has been hampered by a web of more than 30 domestic bank accounts - and more overseas - where money was moved around quickly. Individual, hedge fund and proprietary trading accounts were intermingled at the firm, and false bank statements were rampant, according to the receiver. 'There has been a tremendous amount of money lost,' said Scott A. Masel, the S.E.C.'s head counsel in Miami investigating KL. 'We might be looking at something akin to a Ponzi scheme, but the records make it difficult to pin down exactly what happened here.' What's clear is that scores of well-heeled investors missed signs that things were not quite right at KL. It turns out, for example, that the fund's principals had little experience in the securities industry. And there was never a formal independent audit to verify whether the remarkable returns reported by the funds were real. 'Even if the guy running the hedge fund has a sterling 20-year reputation on Wall Street, a sophisticated investor who's going to put $20 million in that fund wants to see those safeguards in place,' said Lewis N. Brown, the counsel for a Palm Beach accounting firm that performed some accounting services for one of the smaller KL hedge funds. 'That didn't happen here.' THE story of KL starts in a San Francisco apartment in the late 1990's, where John Kim and Mr. Lee were caught up in a major fad: day-trading of technology stocks. From what can be pieced together about their background through public records and interviews with former colleagues, the two had virtually no experience trading stocks. (Calls to Mr. Kim's lawyers were not returned. Yung Kim and Mr. Lee could not be reached.) Mr. Lee grew up in Las Vegas - where his father now works as a marketing executive at the Bellagio Hotel and Casino - and earned a law degree at Tulane University in 1996. He worked as an associate in the gambling department at a Las Vegas law firm, and, in the late 1990's, in the tax department at a San Diego law firm. John Kim and Yung Kim grew up in a Virginia suburb of Washington. John, who is also known as Jung Kim and is the older of the two, told colleagues that he had graduated from George Washington University and then operated a coffee importing business in South Korea, but that the government took it away and deported him because it was so successful. Mr. Kim bragged to others that he had a vast Wall Street background, often evoking his time in the mergers and acquisitions department at Merrill Lynch, according to former colleagues. (Merrill Lynch said it had no records that Mr. Kim had ever worked there.) The NASD, a regulator that licenses securities professionals, says it has no records that any of the firm's original three principals had the necessary licenses to trade stocks for clients, which a Wall Street brokerage firm would require. Such licenses, however, are not needed to run a hedge fund. Whatever their credentials, Mr. Kim and Mr. Lee rode the tech boom, reporting strong returns to friends and associates. Soon they began attracting outside investors. Eventually, they moved their operation to an office in Irvine, Calif., where they hired a number of young, fairly inexperienced people to trade the principals' own money, or proprietary accounts, while Mr. Kim focused on trading clients' and hedge fund assets. Mr. Lee handled back-office duties and Yung Kim served as the firm's chief financial officer. In August 2002, John Kim and a childhood friend, Rob Melley, decided to open an East Coast branch of KL in the Palm Beach area. But within a couple of months, the two friends had a falling-out after Mr. Kim became frustrated over what he felt was the slow pace of the Palm Beach expansion, according to a former employee who did not want to be identified because of continuing investigations. Mr. Melley walked away from the venture, although his father, James, who was also very close to Mr. Kim, remained a KL investor, according to the former employee. Calls to Rob Melley's residence and to James Melley's lawyers were not returned. Through James Melley, Mr. Kim and his partners met the man who would play a crucial role in giving them entry to the Palm Beach scene: Ronald Kochman. Since the late 1990's, Mr. Kochman had built a lucrative trusts-and-estates practice, counting a number of Palm Beach's movers and shakers as clients. 'Kochman had one of the pre-eminent practices down here,' said Richard Rampell, an accountant who worked with Mr. Kochman on several occasions. 'In the last couple of years, he probated two estates that were well into nine or even 10 figures. He was the envy of a lot of lawyers.' Mr. Kochman would not comment for this article. According to investigators and KL employees, Mr. Kochman became increasingly involved with the firm and formed a close friendship with Mr. Kim, who made him one of its principals. Mr. Kochman, these people said, believed that there were greater riches to be reaped if KL were sold to a large Wall Street firm, as Mr. Kim indicated it eventually would be. They said Mr. Kochman planned to downsize his trusts-and-estates business in order to play an even bigger role at KL. Trusting his new friends, Mr. Kochman provided introductions to his clients and friends and was responsible for bringing in many of KL's investors, according to investigators. His role has now become a focal point among investigators and lawyers representing some of the clients that he put into the fund. Gary Klein, a former S.E.C. branch chief whose firm, Klein & Sallah, represents 65 investors who lost at least $90 million in KL, said that a number of them were also clients of Mr. Kochman's law practice. 'That was clearly a breach of fiduciary duty if Kochman was a principal at KL and didn't disclose it,' Mr. Klein said. Mr. Kochman's lawyer would not comment on whether his client had recommended his own clients to the fund. 'I think Mr. Kochman believed that there might be a future for him' at KL, said his lawyer, Morris Weinberg Jr. 'This looked like a wonderful opportunity that, obviously, didn't work out.' NOT that it was all that difficult for KL to persuade investors to jump into the funds with both feet. Its main fund reported strong returns of 70 percent in 2003 and 40 percent in 2004, according to statements given to investors. The lifestyle of the funds' original three principals also supported the picture of a business doing well. The young men drove flashy cars: Maseratis, Porsche 911's and Mercedes SL 500's. (The firm's personal masseuse drove a Jaguar X-Type that was provided by KL.) End-of-year holiday parties were held in Las Vegas, where Mr. Kim and Mr. Lee were high-rolling VIP's at several casinos. The crown jewel was KL's luxurious offices in the new Esperante building in downtown West Palm Beach. The large sunlit offices were filled with gorgeous desks designed by Dakota Jackson and a conference table that had to be hoisted 17 floors through the building's elevator shaft. Some walls were covered in a gray suede fabric, and in the corner of Mr. Kim's office was a $6,000 massage chair. The trading floor had large flat-panel televisions scattered throughout. It all was a great way to impress clients, who were ushered in to watch the main attraction: Mr. Kim. From his captain's chair, he traded frenetically, surrounded by 20 computer screens. But like so many things at KL, not all was what it seemed. There were, for instance, the many faces of Mr. Kim himself. To KL's investors, he was charismatic and respectful. Several older men who invested in the fund are said by former employees to have treated him like a son. Inside KL, though, Mr. Kim's moods swung sharply. At times, he was extremely patient and friendly with the young traders, going to their homes for poker games. Some employees, however, describe Mr. Kim as an egotistical bully who would have fits of rage. And Mr. Kim may not have been as successful an investor as he wanted people to believe. In fact, a former KL trader said that Mr. Kim did not make any money at all in his trading activities. In KL offering letters, Mr. Kim claimed to have developed a proprietary technical analysis system called 'SmartCharts' that involved short-selling stocks that were making highs in the market - betting that those stocks would lose value. 'Essentially, John was constantly trading against the trend,' recalled the trader, who also did not want to be identified because of his involvement in continuing regulatory investigations. 'The strongest stocks in the fall of 2004 were stocks he was selling short.' Those shorted stocks included those of eBay, Yahoo and Research in Motion, the maker of the BlackBerry wireless device, this trader said. The trader said Mr. Kim often traded ahead of a company's quarterly earnings report - a bet on whether the company would miss, meet or beat Wall Street's expectations. The firm's proprietary traders weren't faring very well, either. A majority of the young, inexperienced traders were not making enough money from their bets in the market to earn a commission. Instead, they were receiving a $1,500 draw each month that they were expected to pay back, according to the receiver. Based on the receiver's investigation so far, it appears that any trading profits the firm recorded during 2003 or 2004 were promptly stolen by the defendants in the securities fraud case, according to Michael R. Tein, a former federal prosecutor who is now a partner at Lewis Tein. As losses mounted late last year, the house of cards holding up KL began to collapse. Last fall, a number of investors started to clamor for an independent audit of KL's funds. 'We told them, 'We have to have audits done on this thing,' ' said a person who invested in one of KL's funds in early 2004 but did not want to be identified because he did not want to be associated with the scandal. 'They kept promising they would do it, but kept putting it off.' The investor said he was even offered 'big incentives' in a meeting late last year with John Kim and Mr. Kochman to bring in new investors. 'I told them when you give me a confirmed, certified audit, I'll consider doing something for you,' the investor said. Certain investors who were receiving daily and weekly updates on the performance of KL's funds realized that they were starting to lose money. Between the losses and the lack of a certified audit, at least two large KL investors filled out withdrawal slips so that they could remove about $10 million from the funds by the end of the year, according to a former employee. Fearing that investors would redeem more money from the funds - money the funds may not have had, according to investigators - the firm's principals raced to stop the outflows. One of their biggest investors who was ready to bolt late last year was a local eye surgeon, Dr. Salomon E. Melgen. By last fall, Dr. Melgen intended to withdraw some of the $12.3 million investment that he and a holding company he controlled had already given to John Kim to manage, according to a lawsuit he filed against the advisory firm and its principals. (Mr. Melgen's lawyer said he would not comment for this article.) Instead, in October, John Kim and Mr. Lee signed a document that guaranteed that Dr. Melgen's $12.3 million would be repaid at the end of January 2005, according to the document. The money was to be set aside in a separate account and traded only by John Kim. Dr. Melgen had invested an additional $7 million in one of KL's funds and put $1 million in a separate account under an agreement that would allow Mr. Kim to use an airplane owned by Dr. Melgen. Within four months of Dr. Melgen's receiving the signed guarantee, his $20 million investment had disappeared, according to the lawsuit. In late February, regulators from the S.E.C. entered KL's California and Palm Beach offices simultaneously, demanding to see documents. Mr. Kim avoided the regulators in West Palm Beach, saying he couldn't be bothered during trading hours, a former employee said. In California, though, regulators met with both Mr. Lee and Yung Kim, S.E.C. documents show. After the meeting, investigators said, Mr. Lee walked out of the office, leaving a half-eaten bag of cookies on his desk. The next morning he went to the airport and bought a one-way ticket for South Korea, using frequent-flier miles, the investigators said. The day after that, Yung Kim disappeared as well. A few days after the S.E.C. appeared on KL's doorstep, John Kim invited about 30 employees to his home. As the employees listened in shock, he said that the company was under investigation and that his brother and Mr. Lee were missing. He said nothing about missing funds. 'John put his arms around me, apologized profusely about what was happening and told me he didn't know anything,' said Al Farinelli, the firm's controller. 'He said his brother was responsible for everything.' John Kim's assets have been frozen by the S.E.C., but he agreed to cooperate with investigators in exchange for being granted access to enough money to pay for eye surgery for his young daughter earlier this year, according to the S.E.C. Mr. Kim has said that, based on his knowledge of his own trading activity, the hedge fund was profitable, according to testimony he provided to regulators in March. If losses did occur, he said, he had no idea whether they were a result of trading screens that had been doctored, or if Mr. Lee and Yung Kim had lost any profits in their own trading activities. Some KL investors say they believe him. 'I think John Kim is a victim in all of this. So is Ron Kochman,' said a female investor who didn't want to be identified but who was friendly with Mr. Kim and his family as well as with Mr. Lee. When asked if she held Mr. Kim responsible for losses she incurred, the investor said, 'I'm the only one responsible for deciding to be in the fund.' LAWYERS at Lewis Tein said they had fielded calls from investors who were eager to give Mr. Kim money again because they believed he could make it back for them. But several people who once called Mr. Kim a friend said they are skeptical of Mr. Kim's claims. 'We're reviewing documents, e-mails and trading records and some of what we've seen so far may not support Mr. Kim's position,' said David B. Rosemberg, a lawyer at Lewis Tein. Other people said they were bothered by a last-minute trip that Mr. Kim made to South Korea in December, when he bought a $650,000 home in Seoul. Furthermore, the S.E.C. said this spring that at least $20 million of investor funds were diverted for the personal use of KL's principals, including Mr. Kim. Investigators said they believe that the fancy cars and even some of Mr. Kim's mortgage payments came directly from KL's coffers. Will the whole story of KL ever be known? Investigators are poring over documents and statements, trying to put together what happened, but that will take months, and even then a clear picture may not emerge. As for the millions lost by investors, it is unlikely that much will be recouped, according to lawyers involved in the case. But people searching for a bigger lesson from the story of KL might find it in a sign at the firm's opulent West Palm Beach offices. It lists KL's 36 trading principles. No. 26? Greed kills.

Subject: Dear Bobby From: Terri To: All Date Posted: Sat, Aug 13, 2005 at 18:19:43 (EDT) Email Address: Not Provided Message: Dear Bobby, when you clean the message board can you leave us a set of recent posts again. Thanks for all always :)

Subject: Why the Little Guy Just Can't Win From: Emma To: All Date Posted: Sat, Aug 13, 2005 at 18:03:29 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2005/08/13/business/13nocera.html Pro Tells Why the Little Guy Just Can't Win By Joseph Nocera WHEN I started out on this new book,' David F. Swensen was saying the other day, 'I thought I was going to take what we do at Yale and make it accessible to the individual investor.' Oh, lucky day! Mr. Swensen, the chief investment officer of the Yale endowment - and to my mind, the best manager of institutional money in the United States - was going to show you and me how to invest the way he does. To his surprise, however, the book Mr. Swensen eventually wrote, 'Unconventional Success: A Fundamental Approach to Personal Investment,' published this last Tuesday, turned out to be the opposite of what he intended. Its title notwithstanding, it doesn't show the little guy how to invest like Yale. Instead, it shows why the little guy will never be able to invest the way Yale does. For all the 'democratization' that has taken place in the world of personal investing the deck is still stacked against the individual. That was Mr. Swensen's fundamental discovery. And his willingness to change course and turn 'Unconventional Success' into a polemic aimed primarily at mutual fund companies, but also at other Wall Street types who fleece the little guy, is to his everlasting credit. After all, he could have told us to buy stocks in companies whose products we buy at the supermarket, like a certain investment genius of a previous era. Any regrets about that advice, Peter Lynch? A YALE graduate and a protégé of the Nobel laureate James Tobin, David Swensen took over the Yale endowment in 1985, at the tender age of 31, after a brief stint on Wall Street. Within a few years, he had turned it into the best-run, most influential institutional fund in the country - the fund that every other institution wants to emulate. His track record is astounding: over the last two decades, Yale has generated average annual returns of 16.1 percent, a number no one else can touch. The fund itself has grown in that time to over $15 billion from $1.3 billion, even though it now spends over $550 million a year to help cover Yale's operating budget. Even more impressive, though, is the way Mr. Swensen and his Yale colleagues have gone about generating those returns. When Mr. Swensen first took over, Yale's portfolio held stocks and bonds, period. Like most institutional portfolios of that time, 'it was neither diversified nor particularly equity-oriented,' Mr. Swensen recalled. Today, the endowment has barely 5 percent in bond holdings. 'The other 95 percent,' he said, 'are in places that we think will provide 'equity like' returns.' Which is not to say it is all in equities. On the contrary, the Yale portfolio is extraordinarily diversified, which both lifts returns and protects against disaster. At the end of the 2004 fiscal year, Yale had a mere 15 percent of its assets in domestic equities, and another 15 percent in foreign stocks. It had 15 percent in private equity, and 18 percent in 'real assets,' which includes investments in timber and energy. But its biggest percentage, 26 percent, was in something called 'absolute return.' That is a category invented by Mr. Swensen in 1990. It means hedge funds. Before Mr. Swensen arrived on the scene, hedge fund investors were almost exclusively rich people. But he quickly realized that the best hedge fund managers were extremely skilled, and he began putting Yale's money in a variety of hedge funds. Eventually, other institutions realized that Yale was making money in good markets and bad ones, and they raced to copy Mr. Swensen's model. If you want to understand why hedge funds are exploding these days, a big reason is that every big institutional investor in the country is trying to do what Yale does. His new book has given Mr. Swensen a greater appreciation of the enormous advantages he has as an institutional money manager, starting with the obvious fact that he has a staff that spends full-time researching investment possibilities. Thus, he takes it as a given that individuals shouldn't pick stocks themselves. 'I see every day how competitive the markets are, and how tough. So the idea that you can do this yourself, that's out the window.' But as he looked around at the alternatives for individuals, he found himself horrified by what he saw - especially at the $8 trillion mutual fund industry, which is the primary means through which individuals invest in the market. Although his prose tends to be on the academic side, his sense of outrage comes through on every page of 'Unconventional Success.' What is it about mutual funds Mr. Swensen finds offensive? Just about everything. He hates the way the loads and all the hidden fees mean that the investor is always behind the eight ball. (When I asked him about hedge fund fees, which are much higher, Mr. Swensen replied: 'I don't mind paying a lot for actual performance. Besides, when we negotiate fees, it's sophisticated investor versus fund manager. It's a fair fight.') He thinks that it is criminal for fund companies to allow popular funds to balloon in size, making it nearly impossible for the manager to beat the market. He hates the way the industry pushes exactly the wrong fund at the wrong time - Internet-oriented funds at the height of the bubble, for instance. (He has one example of a Schwab advertisement during the bubble that is simply devastating.) He notes, as others have before, that the vast majority of actively managed funds underperform. He uses 'invidious,' 'investor-damaging' and 'dirty scheme' to describe the general behavior of the industry. Even the mutual fund monitoring companies don't help even the odds. Mr. Swensen absolutely skewers Morningstar, the company that has built its reputation rating mutual funds. His data shows that, like Moody's belatedly downgrading a corporate bond, Morningstar downgrades this or that poorly performing mutual fund only after the damage has been done. His core point, though, is that the for-profit fund industry has a fundamental conflict between its desire for corporate profits and its fiduciary duty to its investors. And the profit motive wins out every time. So does Mr. Swensen offer any hope at all? Some. He thinks we'd all be better off sticking with index funds, instead of trying to beat the market. He thinks we should get our index funds from Vanguard, with its rock-bottom fees. (As a not-for-profit company, Vanguard also doesn't have the central conflict of interest.) We should have a diversified portfolio of index funds, for the same reason Yale does. We should be disciplined in our approach, especially in rebalancing our portfolio to stick to our diversification targets. Of course, this invariably means paring back on winners and increasing our investment in laggards. But as sensible, and, in truth, not particularly unconventional, as this advice is, how many of us will actually follow it? Human beings simply aren't hard-wired to be good investors. Think about it: how many of us, really, have the fortitude to pare back our winners and buy more of our losers? Most of us do just the opposite. Heck, so do most mutual fund managers, which is why they can't beat the market either. There is a reason we as a culture have accorded hero-like status to great investors like Warren E. Buffett and Peter Lynch. For all the cultural reinforcement we get that investing is something anybody ought to be able to master, we know in our bones it's not true. Mr. Buffett and Mr. Lynch are like great athletes, who have the skill and the emotional makeup to do something well that the rest of us can only dream about. That describes David Swensen, too. What he has to say is worth listening to. But will we ever truly hear it?

Subject: Re: Why the Little Guy Just Can't Win From: Emma To: Emma Date Posted: Sat, Aug 13, 2005 at 18:06:58 (EDT) Email Address: Not Provided Message: Notice that Vanguard index funds become the alternative investments. I will read this book in the next couple of days, even though a Yalie od all people wrote it :) I will then deny reading it however.

Subject: Re: Why the Little Guy Just Can't Win From: Emma To: Emma Date Posted: Sat, Aug 13, 2005 at 18:08:28 (EDT) Email Address: Not Provided Message: Oh, Bobby is a Yalie. But, we forgive Bobby.

Subject: Re: Why the Little Guy Just Can't Win From: Dorian To: Emma Date Posted: Sun, Aug 14, 2005 at 02:10:52 (EDT) Email Address: Not Provided Message: A very good article Emma. I look forward to your report on the book. Might very well order it from my library. Thanks, Dorian

Subject: More Africans Enter U.S. From: Emma To: All Date Posted: Sat, Aug 13, 2005 at 14:19:41 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2005/02/21/nyregion/21africa.html?ex=1124596800&en=575a695f2433d525&ei=5070&emc=eta1 February 21, 2005 More Africans Enter U.S. Than in Days of Slavery By SAM ROBERTS For the first time, more blacks are coming to the United States from Africa than during the slave trade. Since 1990, according to immigration figures, more have arrived voluntarily than the total who disembarked in chains before the United States outlawed international slave trafficking in 1807. More have been coming here annually - about 50,000 legal immigrants - than in any of the peak years of the middle passage across the Atlantic, and more have migrated here from Africa since 1990 than in nearly the entire preceding two centuries. New York State draws the most; Nigeria and Ghana are among the top 20 sources of immigrants to New York City. But many have moved to metropolitan Washington, Atlanta, Chicago, Los Angeles, Boston and Houston. Pockets of refugees, especially Somalis, have found havens in Minnesota, Maine and Oregon. The movement is still a trickle compared with the number of newcomers from Latin America and Asia, but it is already redefining what it means to be African-American. The steady decline in the percentage of African-Americans with ancestors who suffered directly through the middle passage and Jim Crow is also shaping the debate over affirmative action, diversity programs and other initiatives intended to redress the legacy of slavery. In Africa, the flow is contributing to a brain drain. But at the same time, African-born residents of the United States are sharing their relative prosperity here by sending more than $1 billion annually back to their families and friends. 'Basically, people are coming to reclaim the wealth that's been taken from their countries,' said Howard Dodson, director of the Schomburg Center for Research in Black Culture, in Harlem, which has just inaugurated an exhibition, Web site and book, titled 'In Motion,' to commemorate the African diaspora. The influx has other potential implications, from recalibrating the largely monolithic way white America views blacks to raising concerns that American-born blacks will again be left behind. 'Historically, every immigrant group has jumped over American-born blacks,' said Eric Foner, the Columbia University historian. 'The final irony would be if African immigrants did, too.' The flow from Africa began in the 1970's, mostly with refugees from Ethiopia and Somalia, and escalated in the 1990's, when the number of black residents of the United States born in sub-Saharan Africa nearly tripled. Combined with the much larger flow of Caribbean blacks, the recent arrivals from Africa accounted for about 25 percent of black population growth in the United States over all during the decade. Nationally, the proportion of blacks who are foreign born rose to about 7.3 percent from 4.9 percent in the 1990's. In New York City, about 1 in 3 blacks are foreign born. According to the census, the proportion of black people living in the United States who describe themselves as African-born, while still small, more than doubled in the 1990's, to 1.7 percent from about 0.8 percent, for a total estimated conservatively at more than 600,000. About 1.7 million United States residents identify their ancestry as sub-Saharan. Those numbers reflect only legal immigrants, who have been arriving at the rate of about 50,000 a year, first mostly as refugees and students and more recently through family reunification and diversity visas. Many speak English, were raised in large cities and capitalist economies, live in families headed by married couples and are generally more highly educated and have higher-paying jobs than American-born blacks. There is no official count of the many others who entered the country illegally or have overstayed their visas and who are likely to be less well off. Kim Nichols, co-executive director of the African Services Committee, which directs newcomers to health care, housing and other services in the New York region, estimates that the number of illegal African immigrants dwarfs the legal ones. 'We think it's a multiple of at least four,' she said. Africans' reasons for coming echo the aspirations of earlier immigrants. 'Senegal became too small,' said Marie Lopy, who arrived as a student in 1996, worked as a bookkeeper in a restaurant and earned an associate degree in biology from the City University of New York. After winning a place in an American immigration lottery that his secretary had entered for him in 1994, Daouda Ndiaye recalls being persuaded by his six children to leave Senegal, where he was working as a financial manager. 'I said, 'I'm 45, I'd have to build a whole new life, I'd have to go to school to learn English,' ' he recalled. 'They said, 'We want you to go and we want you to send for us because there's more opportunity in the U.S. than here.' ' His wife and two of his children have joined him in the United States, where he has worked as a sporting goods store manager and is now a translator. That the latest movement of black Africans arriving voluntarily surpasses the total who disembarked in chains before the United States outlawed international slave trafficking is a bit of a statistical anomaly. That total, most historians now agree, was about 500,000, with an annual peak of perhaps 30,000, compared with the millions overall who were sold into slavery from Africa. Many died aboard ship. Most were transported to the Caribbean and Brazil, where they were vulnerable to indigenous diseases and to the rigors of raising sugar cane, which was harder to cultivate than cotton or rice, the predominant crops on plantations in the United States, where the slave population was better able to survive and reproduce. Moreover, black Africans represented a much higher proportion of the population then than they do today. In 1800, about 20 percent of the 5 million or so people in the United States were black. Among nearly 300 million Americans today, about 13 percent are black. Still, with Europe increasingly inhospitable and much of Africa still suffering from the ravages of drought and the AIDS epidemic and the vagaries of economic mismanagement, the number migrating to the United States is growing - despite the reluctance of some Africans to come face to face with the effects of centuries of enduring discrimination. In the 1960's, 28,954 legal immigrants were admitted from all of Africa, a figure that rose geometrically to 80,779 in the 1970's, 176,893 in the 1980's and 354,939 in the 1990's. In 2002, 60,269 were admitted, including 8,291 from Nigeria, 7,574 from Ethiopia, 4,537 from Somalia, 4,256 from Ghana and 3,207 from Kenya. To many Americans, the most visible signs of the movement are the proliferation of African churches, mosques, hair-braiding salons, street vendors and supermarket deliverymen, the controversy over female genital mutilation and the election last year of Barack Obama, son of a native Kenyan, to the United States Senate from Illinois. Especially in New York City, the shooting deaths of two unarmed African immigrants, Amadou Diallo from Guinea in 1999 and Ousmane Zongo from Burkina Faso in 2003, come to mind. Immigrants arrive with their own perceptions and expectations, from countries where blacks constitute a majority at every level of society, only to discover that whether they are professors or peddlers, they may be lumped together here by whites and even by American-born blacks. 'You have the positive impact that race is not seen to be an absolute definer of people's opportunities,' Kathleen Newland, director of the Migration Policy Institute, a nonpartisan research group, said, 'but that begs the larger question of what does it mean to have a black skin in the United States.' Agba Mangalabou, who arrived from Togo in 2002, recalls his surprise when he moved here from Europe. 'In Germany, everyone knew I was African,' he said. 'Here, nobody knows if I'm African or American.' Ms. Lopy, who now works as a medical interpreter for the African Services Committee, describes herself as 'African, first and foremost,' though the identity of her children will depend on whom she marries and where. 'I'll raise them to be African-something,' she said, 'but ultimately they'll define it for themselves.' Sylviane A. Diouf, a historian and researcher at the New York Public Library's Schomburg Center and Dr. Dodson's co-author of 'In Motion,' said that Americans have a more positive view of immigrants in general than they do of American-born blacks. Referring to African immigrants, she said: 'They are better educated, they're here to work, to prosper, they're more compliant and don't pose a threat.' Dr. Dodson added, 'They're not politically mobilized as yet and not as closely tied to the African-American agenda.' While the ancestors of most Caribbean-born blacks were enslaved, and slavery also victimized the forbears of many African-born blacks, the growing proportion of immigrants may further complicate the debate over programs envisioned to redress the legacies of slavery. 'I think there is a legitimate set of specific claims by persons born in the United States that don't necessarily apply to Caribbean or African populations that have come here subsequently,' Dr. Dodson said. 'African-born and Caribbean-born brothers and sisters have realized that the police don't discriminate on the basis of nationality - ask Amadou Diallo,' said Professor Charles J. Ogletree Jr., who teaches at Harvard Law School and has warned colleges and universities that admitting mostly foreign-born blacks to meet the goals of affirmative action is insufficient. 'Whether you are from Brazil or from Cuba, you are still products of slavery,' he continued. 'But the threshold is that people of African descent who were born and raised and suffered in America have to be the first among equals.' French-speaking Haitians do not necessarily mix with English-speaking West Indians, much less with Africans, and competition for jobs has been another source of tension. 'The Africans tend to be quite industrious and entrepreneurial and often take advantage of opportunities that might have been here for others before,' said Kim Nichols of the African Services Committee. 'We're talking about very profoundly different cultures,' Kathleen Newland said. Analyses by the Department of City Planning, and by the Lewis Mumford Center for Comparative Urban and Regional Research, in Albany found recent immigrants often segregated from other blacks. The census found Nigerian clusters in Flatlands and Canarsie in Brooklyn and Ghanaians in Morris Heights and High Bridge in the Bronx. 'As with European ethnics at the turn of the century,' Joseph J. Salvo, the director of the population division of the Department of City Planning, and Arun Peter Lobo, the deputy director, wrote recently, 'ethnicity has been a powerful force in shaping black residential settlement in New York.' Immigration may also shift some of the nation's focus from racial distinctions to ethnic ones. 'Certainly, South Africa showed us that minority status does not necessarily correlate to one's position in society, but rather that power and its uses are the issues,' said Samuel K. Roberts of Columbia, a history professor who is also on the faculty of the university's Institute for Research in African-American Studies. 'That being said, increasingly distinguishing between black Americans and black Africans may produce conditions in which we will be less prone to think of a fictional construct of 'race' as the distinguishing factor among all of us in North America.' How long might those distinctions last? 'I guess one of the questions will have to be what happens in the next generation or two,' said Professor Foner of Columbia. 'In America, marriage is the great solvent. Are they going to melt into the African-American population? Most likely yes.'

Subject: The Dollar Problem From: Terri To: All Date Posted: Sat, Aug 13, 2005 at 11:32:49 (EDT) Email Address: Not Provided Message: The problem is the dollar is overvalued from a trade perspective, but growth in Europe and Japan and elsewhere is still highly dependent on exports demand from America and decline in the value of the dollar will be at least somewhat resisted. China has increased the value of the Yuan by 2%, which will have a minimal effect on trade, and she is not likely to be successfully pressured from here. So, the dollar should lose value but how? Currency traders have just not attacked the dollar so far. They might well regret attacking the dollar dearly.

Subject: Racial and Ethnic Minorities Gain From: Emma To: All Date Posted: Sat, Aug 13, 2005 at 06:00:29 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2005/08/12/national/12census.html Racial and Ethnic Minorities Gain in the Nation as a Whole By ROBERT PEAR WASHINGTON -The nation as a whole is moving in the direction of its two most populous states, California and Texas, where members of racial and ethnic minorities account for more than half the population, the Census Bureau said Thursday. Non-Hispanic whites now make up two-thirds of the nation's total population, the bureau said, but that proportion will dip to one-half by 2050, according to the agency's latest projections. In a new report, estimating population levels as of July 1, 2004, the Census Bureau said Texas had a minority population of 11.3 million, accounting for 50.2 percent of its total population of 22.5 million. Texas is the fourth state in which minority groups, taken together, account for a majority of the population. But no one racial or ethnic group by itself accounts for a majority of the total population there. Steven H. Murdock, the state demographer for Texas, said, 'In some sense, Texas is a preview of what the nation will become in the long run.' 'Our future in Texas is increasingly tied to our minority populations,' Mr. Murdock said. If their education and skills continue to lag, he added, the state will be less competitive in the global economy. Members of racial and ethnic minorities also make up more than half the population in Hawaii (77 percent) and New Mexico (56.5 percent). In California, state officials said minorities had accounted for more than half of the population since 1998, and the Census Bureau said they now made up 55.5 percent of the total. Minorities accounted for about 40 percent of the population in each of five other states: Maryland, Mississippi, Georgia, New York and Arizona. New York had the largest black population, 3.5 million, while California had the largest Hispanic population (12.4 million) and the largest Asian population (4.8 million). Mr. Murdock said immigration accounted for half of the recent increase in Texas's minority population, while half was because of the excess of births over deaths. Hispanic women, who are having children at a rate of 3 per woman, had a significantly higher fertility rate than blacks, with an average of 2.3, and non-Hispanic whites, with an average of 1.9, Mr. Murdock said. In the four-year interval from the last census, in April 2000, to July 2004, the bureau reported, the total population of the United States grew 4.3 percent, to 293.7 million, and the black population increased by 5.7 percent, to 39.2 million. But, it said, the Asian population increased 16.2 percent, to 14 million, and the Hispanic population rose 17 percent, to 41.3 million. Hispanics can be of any race. In the same four-year period, the bureau said, the non-Hispanic white population grew 1.1 percent, to 197.8 million, while the rest of the nation - the 'minority population' - grew 11.6 percent, to 95.8 million. Cecilia Muñoz, a vice president of the National Council of La Raza, a Latino civil rights group, said: 'This great diversity and constant demographic change make us a dynamic country. They do not cause unrest or commotion. They are part of a process that's intrinsically American.' Ms. Muñoz said 'the political strength of Latinos takes a while to catch up with our demographic strength,' in part because one-third of the Latino population is under the age of 18 and many Hispanics are not citizens. Among counties, the Census Bureau said, Los Angeles had the largest Hispanic population, 4.6 million, and the largest Asian population, 1.4 million. Non-Hispanic whites accounted for just 30 percent of the county's total population of 9.9 million. Cook County, Ill., which includes Chicago, had the largest black population, 1.4 million. The Census Bureau figures show that Hispanics account for 36 percent of the total population in the nation's five largest counties: 9.1 million of the 25.4 million people who live in Los Angeles, Cook County, Harris County, Tex. (Houston), Maricopa County, Ariz. (Phoenix) and Orange County, Calif. In Texas, as in many other states, said Mr. Murdock, a professor at the University of Texas, San Antonio, 'the white population is growing very slowly, while other racial and ethnic groups are growing quite rapidly.' Officials in California and Texas said Hispanics had fanned out across their states, while the black population tended to be more concentrated in urban areas. Hispanics are the largest ethnic group in four of the five largest cities in Texas, Houston, Dallas, San Antonio and El Paso, Mr. Murdock said. But, he said, they also account for much of the population growth in rural counties.

Subject: Assess Your Area's Real Estate Bubble From: Emma To: All Date Posted: Sat, Aug 13, 2005 at 05:59:49 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2005/08/13/realestate/13froth.html Do Try This at Home: Assess Your Area's Real Estate Bubble By DAMON DARLIN For the first time since the residential real estate marathon began 13 years ago, parts of the country are showing signs of exhaustion. But if you rely on the experts to declare that a particular area's bubble has popped, you may have waited too long. So how can a homeowner tell if a market is about to go bust? This may be one of those rare occasions when professionals parsing data are at a disadvantage to regular people watching the market. That's because the main driver of today's market is consumer psychology. Home prices go up as long as people expect them to go up. When they stop believing, prices fall - and no economist in Washington can get wind of that faster than someone chatting over knockwurst at a neighborhood block party. 'Economists looking at the macrodata will be the last to know,' said Richard A. Brown, chief economist at the Federal Deposit Insurance Corporation. What you will learn from the professionals who are dutifully crunching numbers is that prices are not falling significantly in any of the hot markets, but in a dozen or so cities in the Northeast and in California, they are near the peak. In Boston, for example, the time that homes are sitting on the market has stretched to 46 days from 39 days a year ago. An analysis of price appreciation, done for The New York Times by the Joint Center for Housing Studies at Harvard, shows that the price appreciation in cities including New York City; Austin, Tex.; Philadelphia; and Providence, R.I., are decelerating. Appreciation in Detroit and Denver has already slowed to a crawl. 'It's taking a lot longer to sell a home,' says Karl A. Martone, a Re/Max Properties agent in Providence, where homes now sit on the market an average of 65 days, up from 14 days a year ago. The region has almost six months of inventory, which is up 35 percent from a year ago. Vicki Doran, a real estate agent with Coldwell Banker in Providence, says: 'It's switching to a buyer's market. Last year buyers had to snap things up. Now they can shop around.' Even a few markets in hard-charging California - San Diego, Orange County and Santa Cruz - are part of the trend, according to data from the first three months of the year. Data for the second quarter to be released by the government on Sept. 1 may confirm the trend. But already Christopher Thornberg, senior forecaster at UCLA Anderson Forecast, a service of the University of California, Los Angeles, says California has 'peaked and is already coming down the back side.' On Tuesday, David A. Lereah, the chief economist at the National Association of Realtors, said that the housing market was 'probably close to a peak right now.' Take a look at the hot San Diego condo market. In Park Place, one of the many sleek towers of condominiums recently slung up around Petco Park, a one-bedroom condo is offered for $719,000. Someone buying it would expect to make mortgage payments of about $3,775 a month, plus monthly maintenance fees. But someone really wanting to live in the high-rise, with hardwood floors, granite countertops and city views for a lot less, could rent a nearly identical unit in the same building for $2,400 a month. That is clear evidence prices have to move down. You are more apt to see that the price of residential property no longer is connected to its underlying value than a person looking only at spreadsheets of sales data. Prices in overheated markets must, by definition, come back down to the mean. Knowing which way the market is headed before buying or selling is extremely important to anyone who wants to protect the wealth tied up in a house. And it certainly matters to anyone who is thinking of buying because it never makes much sense to buy at the top of the market. 'The turning point is pretty important,' Mr. Brown said, 'because the trend will play out for years.' The trouble is, economists have been wrong before when they try to call the market. Three years ago, Dean Baker, co-director of the Center for Economic and Policy Research in Washington, said that it would be only a matter of months before prices began to fall. Prognosticators at the research firm Economy.com declared that the peak was last summer. Celia Chen, the firm's director for housing economics, is now saying that it will come this year. 'The timing is always difficult with these things,' admits Ian Morris, chief United States economist at HSBC Securities U.S.A., who made the same call, repeatedly. John Karevoll, an analyst with DataQuick Information Systems, which provides real estate data to lenders, said: 'We've been told for years that the peak is just around the corner. The economists have so much egg on their faces.' Don't be too hard on them. It's the nature of their science. N. Gregory Mankiw, the Harvard University professor and former head of the White House Council of Economic Advisers, made one of the most famous miscalls. In 1989 he wrote a paper arguing that the aging of the baby boomers was going to undermine the housing market in the 1990's and 2000's. Whoops. Though it appears the shift is now at hand, the end of the bubble will not look anything like the crash in the stock market after the technology bubble. The stock market turns frenetic when investors scramble to get out and prices fall sharply. In housing, however, a collapse is signaled by a sharp drop in activity as people hold off buying. Houses stay on the market longer. Inventories grow. Only then will prices fall, slowly. Economists say prices will lag a slowdown in the market by four to six months. Some of the data on where a local market is headed is available on the Internet (links are at nytimes.com/business). In other cases, your real estate agent is your best friend. He or she has access to a storehouse of raw data from the local Multiple Listing Service. Here are some indicators to look at: Market activity How many homes are sold compared with the month before is the earliest indicator, but it is notorious for false positives. But if the number of homes sold starts to drop, perk up. Every county tracks this and makes it available to the public. Inventory Some of the most crucial pieces of information are held closely by real estate agents. The number of houses on the market is one of them. The national average is 4.3 months; 6 months is closer to normal, the National Association of Realtors says. When it grows, there is trouble coming. Time on the market Agents control access to this information, and be warned: they know how to manipulate it. A house that has been languishing can be taken off and put back to look like a fresh listing. But you'll still be able to see the average time stretching as a clear signal of cooling. Prices It's what you care about most. But month-to-month comparisons are nearly useless as an indicator because sales of a few houses on either end of the market can skew the figures. DataQuick at www.dqnews.com has some data and the Office of Federal Housing Enterprise Oversight issues quarterly reports. Failed to sell The super-secret indicator among agents is the number of houses that are quietly taken off the market - usually because they are priced too high. Wheedle the number out of them and you'll have a strong indicator of market health. Price-to-rent ratio This is a wonderful measure that gets at the intrinsic value of a property, but it's a tricky tool for the layman. Rent data include everything from studios to four-bedroom penthouses, making a comparison with single-family homes difficult. Some of the rent data can be found at www.realfacts. com. Loan quality The popularity of interest-only mortgages could become one of the best indicators of a fragile market, several economists say. Mr. Thornberg of UCLA Anderson says it's a sign that lenders are scraping the bottom of the barrel. 'We are close to running out of shills,' he says. Risk The PMI Group of Walnut Creek, Calif., a provider of data to the mortgage industry, estimates how much prices could drop using an econometric model. It publishes the list of at-risk cities at www.pmigroup.com. Popular sentiment To judge from the media, the housing bubble may have peaked in June. According to a Nexis search of magazines and newspapers, that month was the peak, with 312 references to 'housing bubble,' almost six times that of a year earlier. It fell 24 percent in July. Of course, there is one constant: real estate agent sentiment. Most of them will never tire of saying it's a great time to buy. Despite the signs of a slowdown, Mr. Martone, the Providence real estate agent, says prices are holding and he still does not have enough properties to sell. He says, 'I am the eternal optimist.'

Subject: Errors Cited in Assessing Climate Data From: Emma To: All Date Posted: Sat, Aug 13, 2005 at 05:56:40 (EDT) Email Address: Not Provided Message: http://www.nytimes.com/2005/08/12/science/earth/12climate.long.html Errors Cited in Assessing Climate Data By ANDREW C. REVKIN Some scientists who question whether human-caused global warming poses a threat have long pointed to records that showed the atmosphere's lowest layer, the troposphere, had not warmed over the last two decades and had cooled in the tropics. Now two independent studies have found errors in the complicated calculations used to generate the old temperature records, which involved stitching together data from thousands of weather balloons lofted around the world and a series of short-lived weather satellites. A third study shows that when the errors are taken into account, the troposphere actually got warmer. Moreover, that warming trend largely agrees with the warmer surface temperatures that have been recorded and conforms to predictions in recent computer models. The three papers were published yesterday in the online edition of the journal Science. The scientists who developed the original troposphere temperature records from satellite data, John R. Christy and Roy W. Spencer of the University of Alabama in Huntsville, conceded yesterday that they had made a mistake but said that their revised calculations still produced a warming rate too small to be a concern. 'Our view hasn't changed,' Dr. Christy said. 'We still have this modest warming.' Other climate experts, however, said that the new studies were very significant, effectively resolving a puzzle that had been used by opponents of curbs on heat-trapping greenhouse gases. “These papers should lay to rest once and for all the claims by John Christy and other global warming skeptics that a disagreement between tropospheric and surface temperature trends means that there are problems with surface temperature records or with climate models,” said Alan Robock, a meteorologist at Rutgers University. The findings will be featured in a report on temperature trends in the lower atmosphere that is the first product to emerge from the Bush administration's 10-year program intended to resolve uncertainties in climate science. Several scientists involved in the new studies said that the government climate program, by forcing everyone involved to meet five times, had helped generate the new findings. 'It felt like a boxing ring on occasion,' said Peter W. Thorne, an expert on the weather balloon data at the Hadley Center for Climate Prediction and Research in Britain and an author of one of the studies. Temperatures at thousands of places across the surface of the earth have been measured for generations. But far fewer measurements have been made of temperatures in the air from the surface through the troposphere, which extends up about five miles. Until recently Dr. Christy and Dr. Spencer were the only scientists who had plowed through vast volumes of data from weather satellites to see if they could indirectly deduce the temperature of several layers within the troposphere. They and other scientists have also tried to analyze temperature readings gathered by some 700 weather balloons lofted twice a day around the world. But each of those efforts has been fraught with complexities and uncertainties. The satellites' orbits shift and sink over time, their instruments are affected by sunlight and darkness, and data from a succession of satellites has to be calibrated to account for eccentricities of sensitive instruments. Starting around 2001, the satellite data and methods of Dr. Christy and Dr. Spencer were re-examined by Carl A. Mears and Frank J. Wentz, scientists at Remote Sensing Systems, a company in Santa Rosa, Calif., that does satellite data analysis for NASA. They and several other teams have since found more significant warming trends than the original estimate. But the new paper, by Dr. Mears and Dr. Wentz, identifies a fresh error in the original calculations that, more firmly than ever, showed warming in the troposphere, particularly in the tropics. The error, in a calculation used to adjust for the drift of the satellites, was disclosed to the University of Alabama scientists at one of the government-run meetings this year, Dr. Christy said. The new analysis of data from weather balloons examined just one possible source of error, the direct heating of the instruments by the sun. It found that when data were examined in a way that accounted for that effect, the temperature record produced a warming, particularly in the tropics, again putting the data in line with theory. 'Things being debated now are details about the models,' said Steven Sherwood, the lead author of the paper on the balloon data and an atmospheric physicist at Yale. 'Nobody is debating any more that significant climate changes are coming.'

Subject: Léopold Senghor From: Emma To: All Date Posted: Fri, Aug 12, 2005 at 19:48:22 (EDT) Email Address: Not Provided Message: http://carpe.umd.edu/congo_basin_news/news_article.asp?article=98 December 21, 2001 Léopold Senghor: Senegal's Poet of Négritude By ALBIN KREBS - New York Times Léopold Sédar Senghor, a poet, professor, philosopher and statesman who became the first president of Senegal when it gained independence from France, died yesterday at his home in Normandy. Mr. Senghor, one of the central figures in the political upheaval that led to freedom for France's African colonies, was 95. His life was a blend of African and European experiences. In World War II, he fought in an all-African French Army unit and spent two years in a Nazi camp after being captured. In 1984, he became the first black member of the French Academy. In between, he served as an always eloquent, often critical spokesman for the cause and culture of Africa. 'I wear European clothing,' he once said, 'and the Americans dance to jazz which derives from our African rhythms: civilization in the 20th century is universal. No people can get along without others.' The current president of Senegal, Abdoulaye Wade, announced the death to a summit meeting of West African nations in Dakar, Senegal. President Alpha Oumar Konaré of Mali, speaking for the 15 leaders there, hailed Mr. Senghor as a 'great politician and great African.' President Jacques Chirac of France yesterday mourned Mr. Senghor as a historic figure for Africa. 'Poetry has lost one of its masters, Senegal a statesman, Africa a visionary and France a friend,' he said in a statement. Mr. Senghor's career was studded with paradoxes. He was a Roman Catholic who led a predominantly Muslim nation, a sophisticated scholar who drew his primary support from peasants and a poet who wielded political power with great skill. Among African leaders, Mr. Senghor was the chief theoretician of négritude, or 'blackness,' his definition for the common culture and spiritual heritage of the black peoples of Africa. In one of his earliest poems, 'Totem,' he wrote: I must hide in the intimate depths of my veins The Ancestor storm-dark skinned, shot with lightning and thunder And my guardian animal, I must hide him Lest I smash through the boom of scandal. He is my faithful blood and demands fidelity Protecting my naked pride against Myself and all the insole