Si Minor Plus Est Ergo Nihil Sunt Omnia

"If less is more then nothing is everything"

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I have always liked the picture above...because it reminds me of the simple things of life...like just sitting down somewhere (alone is actually OK)...or with a friend...nothing much going on....not much of a "going concern" so to speak...but just being together...a nice thought for this Sunday morning...and of course the Latin thoroughly impresses the casual reader...

...so Thanksgiving has passed and the turkeys that survived have a few weeks to go before Christimas arrives...but ham is more of the desired carne of the holiday...and it was a nice break with a couple of the kibbies...and off to work tomorrow for the final push before the semester ends...

...so looking ahead I notice GM and the other "big three" automakers return to Congress this week...and make their case for getting on the dole...as if that would help their prospects...with a bad business model and impossible economic burdens of retirees...so let's see what prevails with a Democratic Congress and new Prez coming our way...but it could be an interesting stock market play...ahead of the hearings...hmmmmm....darn....should have bought some Citibank a week ago!...

...but with the loonies attacking in Mumbai this past week, watching that tragedy unfold just reinforces to me how wacked out people can be...what is the point of blowing up totally innocent people?...how does one make a point other than you have no legitimate cause or political position worth considering?...I just don't get it...even in desperation...very frustrating...and sad....

....but it certainly does point to the danger in the world today...which has probably always been there but just not beamed 24/7 on 500 channels...

...and I was reminded of something I hear from many passionate Dems that America is not respected in the world and that is why we needed to vote for Barak...but I have to tell you that if anyone cares to study history there has rarely been a time (a few but not the norm)...when America has been regarded in such a way by a majority of people in the world...and I experienced this first hand thirty years ago in my travels with the US Navy...protests...etc...so it just is not as simple as hanging it all on George Bush...people will still hate us, protest us, kill our citizens and friends...regardless of who is in the office at the time....

...But to each of you I hope you had a great holiday and send my holiday cheer!

An Unexpected Surprise!

So, we are getting ready to go to the old multi-plex, get a senior discount, and check out the current version of Bond--James Bond--but the little lady says something about a movie set in India...and slums...and orphans...who end up on "Who Wants to be a Millionaire!"...and so I think I would rather have a root canal...or an enema...or both...and what happens? An Unexpected Surprise!

Slumdog Millionaire is not your typical movie...well, really it is completely out of the ordinary...and while I will still lay down a few buckaronies to check out Mr. Bond...I would urge you to visit a Landmark Theatre...or other independent venue...and enjoy this special little treasure...and after I vented a few months ago I am glad to report there remains hope for the big screen...

...So what is Prezelect Barack up to?...change?...sure looks like Clinton III with the appointments made...and one of them big dawgs he lined up on the stage caught my eye...good ole Robert Rubin...so everyone says...who cares? Meesterprezelect is the man! RubinSchmubin! Who cares? Well I do!...

...Well, Mr. Rubin has pocketed some chump change over the past 10 years or so as a major player in Goldman Sachs and most recently as Chairman of Citigroup...yes, Citigroup...who just pocketed another 20 billion or so to add to its previous 25 billion from each of our pockets...so that he can help stabilize Citibank...right before he joins Obama's administration, with Larry Summers and some other Ivy League big dogs...the same group of guys from our finest Universities who got us into a bunch of htis mess in the first place...so much for change...

...but I guess it could be worse...Mister Prezelect could be appointing socialists...and actually he is being beat up in some left circles for not being radical enough...ouch!

...Why not some common folks? You know, non-Ivy League, non-Investment Banking, non-$50,000+ plus per speech kind of people? I guess they aren't capable of dealing with the formidable problems that face our country...but wait, isn't it the same previously mentioned "whiz kids" who got us into this mess in this first place? With deriviatives, credit-swaps, leveraging and ultra-sophisticated financing schemes?

I think Mister Prezelect should create an alternative advising group composed of 20 or so people from across all walks of life--women and men of all political and economic stripes who could look across the table at Mr. Rubin et al and simply say "that dog don't hunt back in Boise" (or Fresno, Provo, Butte, Des Moines...well, you get my point!)

But hey, it could be worse! The stock market could be tanking prior to Mister Prezelect killing me with his tax proposals...well, err....wait a minute! The stock market is tanking! Well, the Chargers are winning!...um, no they aren't...um...hey...oh...well, when all else fails just show a stupid picture of someone! And they don't get much stupider (or uglier) than this one! Happy Thanksgiving! Toodle-doo!

Have we lost our minds?

OK, I may have a better idea than a wholesale move to socialism...why would we possibly want to provide federal funding to the "Big Three" when they are poorly run companies? You want to beat AIG knuckleheads up for $400,000 parties after they get billions in federal funds? Why don't you take a look at the US automobile industries financials? SHEESH! ARRGHH! Maybe I am the only one who is distressed about us bankrupting our children and grandchildren, becauses it certainly doesn't look like the US Congress and incoming Administration gives a &%!@ about them!....

...the reality of the auto industry is that over the past twenty years or so Detroit made contractual concessions to the UAW which slowed hourly wages in return for benefit concessions...well, slowing is relative when we are speaking about hourly wages in the range of $65-$75 per hour for line workers....and guaranteed pension and health benefits for auto workers and retirees...which have fundamentally destroyed the companies...

...and so now we have GM trading below $3...and running out of cash...and holding out their hand to the Feds/each of us....to cover these outrageous management decisions....the reality is that now the US auto industry are health care and retirement companies (seriously here!) that happen to make cars...plain and simple...and if you think that a cash infusion is going to save them we are kidding ourselves...because they will be back for more in 2009...don't believe me?...two words to remember....British Leyland....check out this link http://www.nytimes.com/2008/11/18/business/economy/18car.html from Tuesday's NY Times...for a sobering view of what happens in government bailouts for auto makers who fail to fundamentally address the underlying economic problems....and try to cover over it with dire warnings of a loss of jobs....did I mention this story is from the New York Times?...I found that very interesting....

...So my great idea is if we are going to bail out every industry (with political power, that is)...why don't we simply pay off every mortgage in the US...which will immediately restore the housing market....build wealth...restore confidence....and then we would likely go refinance our homes, take the money, by hot-tubs, jewelry and take a vacation to relieve the stress of the past months and the hit to our 401(k)'s....and begin the cycle again....

....hmmm....maybe my idea won't work in the long run....

Gas Bubbles

"In parallel with this lack of flexibility Venezuela is facing a decline in its international monetary reserves since Chavez keeps raiding them. These monetary reserves only represent some six to seven months of imports at the current level since Venezuela is now importing close to $40 billion per year, mostly in food. Therefore, an interruption of oil income derived from the cut off of oil supplies to the United States would most probably cause the Chavez’s regime to collapse in less than a year as the result of internal protests, no outside intervention required. "

(Source: http://www.humanevents.com/article.php?id=23222 )

So we have greatly lower gas prices! Happy days! Let's load up the Bel-Air wagon with the kids and hit the road! God Bless America!

Well, before you pack the picnic basket and go burn that extra tank of gas for a Sunday drive, maybe we should think just a bit deeper on this issue...

Can we think about using this reprieve in gas prices a bit more strategically? Bottom line is we have a couple of real idiots out there who just love sticking it to us...no, not Obama and McCain silly!...I am talking about Hugo Chavez of Venezula and Iranian President Moomad OhMan...err...umm..Mahmoud Amenpunjab...umm....darn....OK....the nutjob who is the President of Iran who gave "loco Gordo Hugo" the highly acclaimed and widely regarded "Islamic Republic Medal" for Hugo's brave support of Iran in its effort to violate the Interntaional Atomic Energy Agencies and the U.N.'s guidelines on nuclear profileration...(and for my Mennonite and Quaker friends, thanks so much for hosting good old Mahmoud for morning coffee...nice move...and I hope that it doesn't portend President Obama's foreign policy strategy...see http://www.scrippsnews.com/node/36622 for details on the dinner....I wonder if they had scones?)...

Anyway...here is my theory...cutting across all political lines for the common good of the world...

NOW IS THE TIME TO 'DOUBLE DOWN' IN THIS OIL ADDICTION POKER GAME!

I think now is the time for us to think beyond the immediate sense of gratification of having lower prices at the pump...which is nice in and of itself...but we should really get after conserving now through carpooling, solar investment, personal conservation, development of our own energy resources (across the board including nuclear)...and help push these oil despots into the drink...because they are held in power by the ability to subsidize their economies through high oil prices...or better yet, how about if we as a country (read, political will and leadership which is in short supply), simply refuse to import any more Venezulan oil? We just say "gracias Hugo, no mas negro oro"...and put an end to it?

Maybe this is just wishful thinking as I hear all of us celebrate the plunge of about a buck a gallon in the last 5 weeks...oh, and by the way, gas is already below $2 a gallon in quite a few places!...well, in Kansas and Oklahoma, at least...I know, I know....Kansas and Oklahoma, but you see my point, right?....

One last thing before I go....for my brothers and sisters in Mennonite Central Committee, the Quakers and others...whom I do indeed love...towards the point that we need to enter into "constructive dialogues with our enemies" so we can "move towards peace"...it just seems to me that even if I could possibly support this altruistic notion of dialogue regardlesss of its practical effect to create change and the tendency to be manipulated both here and abroad by propagandists....laying all of that aside for the moment...

...During the dialogue with Mahmoud when he answered your question about why he challenged the Holocaust...he gave the answer "more historical research needs to be done"...MCC and the others should have called him on it...because if such groups are willing to be unceasing critics of US policies and practices...many of which need to be questioned...you need to be the same with others especially when it comes to issues such as the Holocaust...we must have no arguments or "constructive dialgoues" because on certain topics we must draw the line...to not do so is to be cast as being duped...and not wise...and it is not enough after the event to meekly say "some of his responses were less than satisfying" (true statement)...that last one actually nasueates me..

For more on this "constructive dialogue" see http://mcc.org/news/news/2006/2006-09-22_sponsorsmeeting.html

(glad I finally got that one of my chest--it had been bugging me for a while!)

BUT NOW, WITH THE ELECTION ALREADY OVER (regardless of us pulling the lever on Tuesday), I WANT ALL OF US TO THINK HAPPY THOUGHTS!

A Horse and His Boys

Well, it really isn't about a horse...but there are horses...a couple of really nice chestnuts with prominent blazes...only about 13 hands but nice little ponies...what? You didn't know I was a horseman from the old days? I hung out at all of the tracks from Del Mar to Santa Rosa, including the small town fair circuit...where they broke from a rope...anyway...secrets from my youth...

Appaloosa starring Ed Harris and Viggo Mortensen supported by Rene Zellweger and Jeremy Irons is a splendid little movie...with Ms. Zellweger constantly creating confounding conundrums (not bad, eh?)...that are neatly weaved through the movie and ultimately bring the characters to a point of painful resolution...both physically, emotionally and professionally...and while one could figure things out as it went if you think hard enough on it...these characters make it the best Western I have seen in a long time...and one of the better movies I have seen in a year or so...

worth the watch...I give it four peaches!

So...anything else we should talk about? Hmmmm....

Who is this old guy? Uncle Earl? No, just a dull old economist and philosopher...name of John Maynard Keynes who came up with this little nugget...

"The market can stay irrational longer than you can stay solvent."

...so as we go into this wacky week there are some big questions about the fundamentals of the market which lead us to a couple of serious questions:

*If Keynes is correct it is really pucker up time as we are toast. All of us.

*If Keynes is not correct it is really double down time. Sell the car and the poodle and buy some quality stocks. Very soon.

*Maybe Keynes is half right #1. The market is irrational. But not for long.

*Maybe Keynes is half right #2. We cannot stay solvent. And it has nothing to do with the length of the market crash.

At the moment (a Sunday morning, only one cup of coffee down, so it might change after cup two)...I am leaning towards some combination of options #3 and #4...that he is half right...

...so I think the market will recover...quicker than many suppose...but not quick enough for most...I am thinking that 12-18 months from now we will recover 1/2 of this loss...and then the remaining amount will take another 3 years to get the rest back...which in historical terms will be a "mild depression" and will not be an ordinary economic cycle...

But the solvency thing really gnaws at me...and my point is it is not the stock market that will bring on mass insolvency but rather the unrealistic standard of living most Americans (and other countries as well, namely Europe but even the MidEast oil kingdoms) have created...we have tapped out our homes and saved pennies on the dollar and are awash in debt...and with the housing market we are in a similar situation to oil prices and cars...

What do I mean?

My point is this. When gas prices drop people are going to return to their driving habits of the past...and not learn anything from the pain of $4 rising to $5 and beyond gas prices...and the same will be true of housing prices...

...thus, if housing prices begin to stabilize (which may be happening in some markets) and then slowly recover...people will just put whatever possible advances in equity they make back into silly purchases once again...and we will have learned nothing from this disaster.

I hope I am very wrong on this and that things have changed. We will have to wait and see...

...but in the meantime...go and see a good movie! A BARGAIN MATINEE AND SKIP THE POPCORN!

The Great Repression

Is it the "Great Depression II" or the "Great Repression I?"

Yepper, now that my retirement savings is down to about $6.04 I am having to make some difficult choices...so it is time for some drastic action...I mean everything is on the table...even moving to western Kansas and simply buying a small piece of land for a few thousand bucks...say two or three thousand acres...and sitting on a porch and be angry at the world...but calmer heads have prevailed...and Starbucks is off the list as well...unless I can catch them at a later hour when they are out of decaf and I order that drink and I get it free because they have to brew it...and also get a free coupon for another drink at another trip...

but other than that I am tightening my belt...

And...so now that I have decided to stay put what do I think about this mess?

First off, I heard several smart folks recently (meaning they moved to an all cash position in March)...say that we are in the "Great Repression" meaning that government is not allowing us to get to the actual bottom of this thing like Grandma Esther and Uncle Andy did in the 30's...so that is a fairly interesting and provocative statement...and is therefore obscuring what is really going on...

Here are some comments I heard at a conference from some pretty smart folks.

First, the good, courtesy of Jeff Immelt, CEO of General Electric:
*“I am pretty optimistic. If I put my head on the pillow and am beat up I have to get up the next morning, look in the mirror and say ‘Hello Handsome!’ ”

* “We will have 2 ¼’s negative growth & then grow.”

*“Some of what has happened is good.”

Now, the bad, from Meg Whitman, former EBay CEO & current McCain Advisor:

*“We are in a severe crisis of leadership.”

*““Our past recessions we saw the consumer continue to spend—that is not going to happen in this one.”

And of course, the ugly, kudos to James Wolfensohn, famed investor & Citigroup advisor:

* “The great unknown is the real value of all of these assets. And are they capable of restoring value? No-one knows.”

*“Technology and innovation will save us. We don’t have the wealth any more. China has 1.7 trillion USD foreign reserves; India 400 billion; the USA 70 Billion.”

*“We could previously assume we were competitive. This is no longer a given.”

OUCH! And if we are not really getting to the bottom of the trouble doesn't it follow that we are not at the bottom of the stock market? That we really don't know what assets are worth? Which leads back to the "Great Repression I" metaphor.

The reality is none of us know where this thing is going to really end...and while I don't really agree with Jeffrey Immelt of a fairly quick end to the recession I do think we are in for some very difficult times...

So old Jim Cramer says in an interview the other day that "We are going to have to begin to live like our parents did. We cannot sustain the standard of living we have had."

Ouch again!

Here is what I think I am going to do:

1) Kansas is off the table. Cheap land and cost of living but way too windy.

2) Double down on my retirement plan. I might as well. It is the only chance I have of recovering what has been lost over the past few months. The financial system is actually much safer than it was 30 days ago. Really.

3) Get used to enormous volatility in the markets. It goes up 500 points? No big deal. Down 500 points? No big deal. Especially when it happens all in 20 minutes.

3) Not buy anything. Anything. It is time to be frugal. Conservative. Cheap.

4) Read history more. We have been here before. We could learn a lot from the "Great Panic of 1908." (See the article at: https://mail.pointloma.edu/exchweb/bin/redir.asp?URL=http://www.newsday.com/news/opinion/ny-opbru5851076sep21,0,5813124.story )

5) Stay focused on the long term. We have to think 5-10 years here kids.

Hang in there. Confidence will eventually return. The market will go up. Things will stabilize.

And as an entrepreneur, I will tell you that I fully believe we are now entering the "Era of the entrepreneur." More to come on that topic.

But here is something else Meg Whitman had to say this past week:

“Business Schools need to focus their grads away from

Wall Street and look to Main Street.”

This or That?

Hmmmm....this..........



OR....

PETA Urges Ben & Jerry's To Use Human Milk
POSTED: 1:48 pm EDT September 23, 2008
UPDATED: 11:51 pm EDT September 23, 2008

WATERBURY, Vt. -- People for the Ethical Treatment of Animals sent a letter to Ben Cohen and Jerry Greenfield, cofounders of Ben & Jerry's Homemade Inc., urging them to replace cow's milk they use in their ice cream products with human breast milk, according to a statement recently released by a PETA spokeswoman.
"PETA's request comes in the wake of news reports that a Swiss restaurant owner will begin purchasing breast milk from nursing mothers and substituting breast milk for 75 percent of the cow's milk in the food he serves," the statement says.
PETA officials say a move to human breast milk would lessen the suffering of dairy cows and their babies on factory farms and benefit human health.
"The fact that human adults consume huge quantities of dairy products made from milk that was meant for a baby cow just doesn't make sense," says PETA Executive Vice President Tracy Reiman. "Everyone knows that 'the breast is best,' so Ben & Jerry's could do consumers and cows a big favor by making the switch to breast milk."
"We applaud PETA's novel approach to bringing attention to an issue, but we believe a mother's milk is best used for her child," said a spokesperson for Ben and Jerry's.

For the complete letter from PETA see http://www.wptz.com/news/17539127/detail.html

Honest! I am not making this up! Viva leche!