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Wednesday, October 21, 2009
Friday, May 16, 2008
Book Beat: Who is teaching Who? Lessons for Ben Bernanke from the Observer
Well. It has been a bit unreal. The recent series of books being read in our family. First my wife began reading "Enron." After she read a paragraph silently, she would pause and say, "I just do not understand this part, could you help with it." Then she would read it aloud, and being The Observer, once having been licensed in commodities, should have been able to make sense of it----and I could not.
In school when one has a problem, one goes to the blackboard to diagram it. In the case of a long series of sham transactions and phoney shell corporations, one quickly runs out of blackboard space.
At the same time, I have been reading "Blood and Sport," the history of the Clintons during the early years---you know the ones where Hillary was trading commodities and turned a $1000 investment into $100,000. And it was very touching lately to listen to Chelsea Clinton speaking on the campaign tour, since Chelsea was conceived while Bill and Hillary were traveling in London ---on money made by trading commodities----yes. It all fits nicely together.
At the very time I was taking the commodities test, I remember being bent out of shape because of the notion of making 100,000 out of a thousand dollars was so off the wall. Till I heard the word "REFCO" as the brokers involved in her trading. (Click on the post for a recent article on Refco).
The commodites exchanges traders are not bound by insider trading rules. It is not clear to me what rules they are bound by. If you know of some, let me know. That is precisely why Chairman Ben Bernanke has proposed that the CFTC be placed under the SEC for supervision. It used to be that areas of public trust such as electricity and oil were regulated for the public trust. Now they are simply gambled for hedge fund financial joy. And then when things go skyhigh----we just blame those ethanol folks.
I do not recall if the commodity trades were ever made public that made Hillary such a great success in commodities-----however, in the matter of trading pools, i would suggest a theory of allocation that might make sense when real estate folks and politicians shared a pool-------If rich real estate investors who had passive gains were joining dirt poor politicians who needed cash, it might make sense in a quid pro world that those who needed the cash would get it, and those who needed the passive losses would get it, and then the politicians would be grateful down the road for their success. I do believe that this type of allocation has always been illegal. That being said, I would love to see the trading logs of the pool to determine what really happened.
What about Bernanke? What does this all have to do with Bernanke?
Just Pretend you are the Chairman of the Federal Reserve---You say to the banks "Give my all your worthless junk and I will give you cash." Then create more "Capital" by issuing more bonds and go forth and make more loans. Do not worry about the junk. "
Maybe it was just reading the improper books in sequence. It just seems that Ben Bernanke may have learned how to structure a banking system from the accounting system at Enron. Or maybe he learned it from the hedge funds or commodities traders.
For my part----my blackboard is just not large enough to diagram all this out. My motto has always been:
It the investment concept cannot be contained on a 3X5 index card, it is probably bogus.
School Beat; Minn: Declining Enrollment, Teacher cuts Affect Minnesota Schools
Click on the post for the latest from Minnesota.
Blogs: End of Times: Iran v Israel; Politics and Religion and military unite
Lots of rhetoric in the press with the anniversary of the founding of Israel----Pres Bush as well as Bin Laden have thoughts on it.
For a little context of the event from the point of view of the "end of times" folks, click on the post. There is even a way to order some 'anti radiation pills" just in case the rapture turns out a bit different that one expected. Enjoy.
Thursday, May 15, 2008
Wednesday, May 14, 2008
Intro by Mr. Peter Dietrich---Explains the structure of the "Divine Comedy"
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Beginning of "Divine Comedy" arr Robert W.l Smith performed by EHS Wind Ensemble dir. Doug Zblewski.
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Reflection: On Gambling: On Rolling out the Call: On Rolling Out the "Con"; On Delusion
Today we have news that year on year, foreclosures have increased 65% in April 2008. Secretary Paulson says we have turned the corner. Federal Reserve Chairman Ben Bernanke says we need to do more to confront the impact of foreclosures. I will leave it to the reader to deduce which has the clearer sense of reality.
I have been reading the book "Blood Sport", the story of President Bill Clinton during the Whitewater years---it is in audio form also. The banking crisis of those days----and I remember them well as a homeowner with interest rates over 10%, and banks failing, and even some in the conservative states of Minnesota and Wisconsin. The total losses picked up by the FDIC was 50 BILLION. Today-----the crisis of mortgage foreclosures is at 500 BILLION and headed to a TRILLION according to some estimates. The major technique of most humans faced with these numbers is DENIAL. Especially during political season. We need some bold ideas for action and not just delay-----but DELAY is the strategy locally, nationally, and whether it will work is questionable----and the stakes are huge. Here is the analysis.
If you click on the post there is my classic post on the "Theory of Double Down"----in gambling, in stock investing-----as I recount, I have been debating this theory with my brother for the past 50 years since we were playing competitve MONOPOLY in the garage.
As a young stockbroker I remember vividly staring at investor accounts the days after the stock market Crash of 1986 where they were fully margined. The issue was right on the table for those who did have margin calls----should the investor meet the margin call with additional capital or should the position be closed out? The answer depends on what one thinks will happen in the future---the past charts are not relevant.
In the options business this dilemma is called "Rolling out the Call"----an investor with a losing position in an expiration ---say peanut butter chunky September 25 Calls, and suddenly the value of chunky falls to 10---there is the impuse to sell the call, take the tax loss, and buy the March 2009 Call, or would the March 2010 call be better. That way---when the market for chunky peanut butter comes roaring back.......WHEW....all will be well. (Chunky calls are fictional for example purposes only.)
On a local basis, if there is a very soft real estate market, with new home sales near zero, the rolling out the call could consist of ADDING lots to create a "Mix" or "Menu" of homes available for purchasers to choose from. Behind the rhetoric of this theory is the practical idea of bankers to hedge their bets by adding and in fact creating a monopoly of homes available in the new market---capturing this market for the next 20-30 years. Rolling out the call to 2030. This is a game for only the strongest players. The rest have to fold.
In the national scene---the infusion of capital from the Federal Reserve and the changes to the Fannie Mae and Freddie Mac to add capacity have allowed banks to get cash for poor quality collateral, and avoid disaster temporarily.....
This all reminds me of a young wife who is unhappy with her marriage, and in her despair decides to have children in the hopes that this will solve her unhappiness. The essential relationship is the key.......and it is the key in the financial sector as well. Unless the essentials are faced, the prospects are not bright.
Who is the best candidate for America? Is it Hillary who spent lots of time on the Whitewater accounting and the problems of Madison Guarantee Savings, or McCain who had his own involvement with problem banks. Yes. I can see it now. President Hillary visiting with the financial gurus in the White House, while, Bill, maybe in the Blue Room, wanting to be supportive, meeting with ...well....who knows....maybe Jennifer Flowers would stop by the White House just for old times sake.
That's how I see it.
Yahoo: Business: Foreclosures surge 65% in April
On a year to year comparison, foreclosures are up 65% in April. Click on the post for the full story.
Tuesday, May 13, 2008
Gazette; Town of Union Public Hearing coming on May 29 on Wind Turbine
Click on the post for the article in the Janesville Gazette.
School Beat; Music: EHS Wind Ensemble performs "The Divine Comedy"
Final Band concert of Year---EHS Wind Ensemble performs The Divine Comedy arr Robert W. Smith. This clip is form the opening of the second section, Purgatorio and opens with the French Horn.
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Fire at Langdon St. destroys Frat House---all safe
Doubleclick on photo for largest version. Click on post for coverage from The Critical Badger Blog that covered the fire on a minute by minute basis. Well done.
WSJ: Reject Irresponsible Budget Deal
Click on the post for today's OP in the Wisconsin State Journal.
Monday, May 12, 2008
"Complete Works of The Evansville Observer---Vol I---The Early Years" Goes to Press
Shortly The Complete Works of the Evansville Observer, Vol I--The Early Years will be published by Blurb, Inc. . All of it that is fit to print. With the usual eclectic mix of rants, poems, Reflections, Political diatribe, the Tales From Normal.... and yes even some heretofore unseen pics. 440 pages in hardcover and softcover.
Following local political tradition, The Observer will be emphasizing a youthful and vigorous spirit and all photos will emphasize a youthful zest. Stay tuned.
Mother's Day 2008
Hymns for Mother's Day---heard in Evansville "Gentle Mother" by George Wollinger with Jane Oberdorf on piano
Mothers Day 2008---"Ave Maria"
Mother's Day 2008---St. Paul's---George Wollinger with Jane Oberdorf on piano singing "Ave Maria."
Sunday, May 11, 2008
Gazette: State reviews traffic response
Click on the post for the article today on the State DOT response to the freeway problem last winter. So far it has been all bun, no beef. Stay tuned.
Saturday, May 10, 2008
Fashion Design: U of Minn; College of Design
The Observer does not cover design. However---the University of Minnesota College of Design does. Click on the post for a glimpse of the senior student designers. Enjoy.
School Beat; Building and Grounds Meets Monday---Shot Put and Discus Area may be moved
Click on the post for the full agenda.
Analysis: "The Reverse Empty Nest Syndrome---the theory"
As the first born of three children, I spent little time wondering about how my parents were coping with the empty nest. As the time approaches for our family to face the empty nest however, I have begun to review the many articles on this syndrome. In a cursory glance of all the stuff that has been written....I have concluded that much of it no longer applies---here is why.
Nowdays, it is far more prevelant that the kids are moving home with their kids, and in fact....the parents are looking for hotel rooms so they can have a getaway weekend for two. Thus----there is in fact NO empty nest syndrome. It is a myth of the past like the Lone Ranger and Tonto.
Blogs; The Right Stuff: "Nihlist in Golf Pants"
Click on the post for the latest from the wildly popular conservative blog in the Twin Cities.
School Beat; Edgerton plans for enrollment decline; Skinnies may be added to 4 period
Click on the post for the latest from the Gazette.
Friday, May 09, 2008
Business: Citigroup announces "winding down" of 400 billion of assets
Click on the post for the story.
Thursday, May 08, 2008
The Latest----MEET and GREET----for PETS
What:
A meet and Greet for pups that have been rescued from high kill Shelters and are now looking for forever homes
WHEN:
Saturday, May 10th
9-3 Rain or Shine
WHERE:
Big Sweeties
790 Brown School Road
Evansville, Wi 53536
We will be selling homemade brats and soda with all donations going towards Happy Hounds Rescue
If you are not looking for an addition to the family, come and eat a great homemade brat made by Alberici's Deli.
Public Safety Committee: Supr. Heidi Carvin Speaks on truancy policy--click on the video icon
5-7-2008; Public Safety Committee Meeting; Supr. Heidi Carvin presents Evansville School position on truancy policy, procedure and sanctions
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Fashion Design: Mailbag: Joan Sends Photoshoot:(Click on the post) Deni on Camera; Rake Magazine
I am grateful to Joan Hector, Senior in Fashion Design at University of Minnesota for sending these photos from the finale photoshoot---captured on Rake Magazine----and the surprise is that Deni, my sister's son, was the photographer.
So. Click on the post and enjoy. This is the Observer. I cover the fishing. I leave fashion coverage to the relatives from Uptown.
Public Safety Committee: Ald. Wessels Speaks on governance; truancy procedures
Alderman Wessels speaks re Truancy procedures; Addresses Governance issues
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Public Safety Committee: 5-7-2008----Judge Tom Alisankus Speaks on Why sanctions requested
Evansville Municipal Judge Tom Alisankus speaks on why placing sanctions in municipal ordinance is necessary regarding truancy
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Twin Cities: Deal with the Recession the Harley Way----
Click on the post for the Harley version of a long time business adage-----
Back in 1982 in the depth of the recession, a Dale Carnegie speaker announced: "Forget the news----work like crazy and take one day at a time. "
Harley has the same message....with a slightly different text.
Business Alert: Click on the video for a virtual tour of Sugar River Motors in Evansville at 498 Water Street----882-1213
Click on the video to tour the new Sugar River Motors in Evansville and meet the owners Paul and Amber; For more details call them at 882-1213 or fax at 1-608-882-1214. 498 Water Street. Full Service Auto Repair has arrived.
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