Thursday, September 30, 2010

Should the US Treasury Brand Dollars for Extra Revenue?

Should the US Treasury sell ad space on its paper currency to help finance the deficit?  This practice might give new meaning to the term crony capitalism, but I bet many firms would be happy to buy advertising space on the currency to "cashvertise."  The USPS currently allows branded stamps, so why shouldn't the Bureau of Engraving and Printing allow the logos of the nations great companies on the currency.  Imagine the prestige of having the corporate logo on a 1, 5, 10, 20, 50 or 100 dollar bill rather than a sports arena.  It would be a win-win for the corporations and the taxpayers, and would be much easier to pull off than actually controlling government spending.  If advertising made Google what it is, just think what it can do for the US Government.
The average circulation life of paper money is:
$1: 1.8 years
$5: 1.3 years
$10: 1.5 years
$20: 2 years
$50: 4.6 years
$100: 7.4 years

Since the Treasury produces 38 Million USD bills per day, selling each ad for $1 per bill could generate as much as $14B a year above printing costs.  What do you think?  ;-)

25 Uses for Borax, "The Miracle Mineral"

As a kid, I can remember watching "Death Valley Days" on TV narrated by Ronald Reagan and Dale Robertson.  The main sponsor of the show was 20-mule team Borax.  It's been years since I've heard or seen anything about Borax, but recently I ran across a couple of articles on the Internet extolling its virtues.  Here is a composite of those articles.

Borax, or "the miracle mineral," has long been hailed as a natural solution for just about everything in the home. This substance is naturally occurring, eco-friendly and is mostly used as a cleaning agent. Its uses, however, are many and varied.

Make sure to heed this safety warning when using Borax:
Just because borax is natural, that doesn't mean it's harmless. You should always use gloves when handling it and keep it out of reach of children and pets. While safe in the diluted solutions, borax could be very harmful to children and pets if ingested.


1. Keep roaches, waterbugs, and ants away by sprinkling a combination of equal parts all-natural borax and sugar.

2. Keep the mice out by sprinkling borax on the floor along the wall.

3. Get rid of bed bugs by sprinkling borax on your mattress. Let it sit and vacuum it up.

4. Kill fleas by sprinkling borax on your carpet. Leave it for an hour and vacuum it up thoroughly.


5. Scrub dirty pots and pans with a mixture of 1 teaspoon of borax and warm water. Because borax is non-abrasive, it will work on the grime without damaging the surface material.

6. Remove a stubborn stain by mixing 1 cup of borax with 2 cups of warm water and apply the paste directly to the stain. Let it sit, then launder as usual. Remove carpet stains by dampening the stain thoroughly and rubbing some borax on it. Vacuum it then finish it off with a vinegar and water solution. Let it dry and repeat if necessary. Use this same method on soiled mattresses. It will get rid of both the odor and stain.

7. Remove rust by mixing the above solution with a tablespoon of lemon juice.

8. Make an all-purpose cleaner by mixing 2 tablespoons borax and 2 cups hot water in a spray bottle.

9. Removes oxidation from metals with borax. The ingredient is also used as a flux in welding.

10. Make your own floor and wall cleaner by mixing 1/3 cup borax, 1 tablespoons ammonia and 1 teaspoon dish detergent into 1 gallon of water.

11. As a laundry detergent, add one cup of borax to each load and significantly boost your cleaning power.

12. Remove stains from stainless steel or porcelain sinks with this recipe: Make a paste with 1 cup borax and 1/4 cup lemon juice. Using a sponge or cloth, rub the stain with the paste. Rinse with warm water.

13. Clean your toilet with this solution: Dissolve 1/2 cup of borax with 1 gallon of water. Scrub the toilet with a strong brush, let it sit and flush to rinse. This non-abrasive cleaner can also be used in the bathtub or on counters.

14. Clean outdoor furniture by washing it with this mildew zapping solution: In a spray bottle, mix 1 teaspoon dish detergent, 1 teaspoon borax and 1 quart warm water.

15. Make your own dishwasher detergent by mixing 1tablespoons borax and 1tablespoons baking soda.


16. Minimize odor in your cat's litter box by mixing a few tablespoons of borax in with the litter.

17. Clean your garbage disposal by putting 3 tablespoons of borax down the drain. Let it sit for an hour and flush it with warm water. This will sanitize it, taking care of any smelly bacteria.

18. Remove mildew and mustiness from linens by soak them in 2 cups of borax mixed with 2 quarts of water. Let the linens sit for a few hours, then rinse them clean.

19. Unclog drains with 1/2 cup of borax followed by 2 cups of boiling water. Let it sit for 15 minutes, then run your water for a few minutes to flush it out.

20. Remove urine odor from a mattress. Wet the mattress rub in borax with a damp cloth. Let dry, then vacuum up the remaining residue.

21. Deodorize and clean your fridge by washing it with a borax and water solution.

22. Deodorize your garbage pail by filling it with borax and water. Let it soak then rinse it out. Sprinkle some borax in the bottom once it's clean. This will keep the bugs away and absorb any odor causing moisture.


23. Kill weeds by sprinkling borax where you've seen weeds previously appear. This is useful for weeds that surface in concrete cracks and on walkways, but shouldn't be used in the garden because it will also kill your plants. Sprinkle some borax around the perimeter of the house too and you'll be free from ants and other intruding insects.

24. Soften your water when doing laundry by adding borax to the load.

25. Bring life back to your worn china by soaking it in a sink full of warm water and a 1/2 cup of borax. Rinse well and wash a second time as usual.

Along with these 25 household solutions, borax is used commercially as an ingredient in enamel glaze, adhesives, ink for indelible pens and is more recently being used in place of Mercury for extracting gold in smaller scale mining operations. In some countries, borax is used as a food additive, but is not approved for use as such in the United States.

Wednesday, September 29, 2010

The Great Tax Debate: Ben Stein and Linda McGibney

Ben Stein

Linda McGibney

For those who feel as Ms. McGibney does--
"I am an American. I am in the highest tax bracket. I also work in entertainment - which is what Mr. Stein does as well. I am fine with the tax increase. I think it patriotic that I am taxed in this way. I want to help my country.

I believe the fact that I can have a job this year, and hopefully every year to come, is a privilege. Mr. Stein, there are Americans who qualify for this tax increase under the proposed plan who don't feel "punished" by it. We feel it is our duty in hard times to help the rest of America.

I am a "have." I am willing to pay this tax increase. I'm not going to whine about it. I won't feel punished. I will understand it's the cost of doing business."
I have good news for you.  The IRS accepts donations and gifts.   Here is the link to the Department of the Treasury website "Gifts to the United States Government" for "citizens who wish to make a general donation to the U.S. government." According to Treasury, "This account was established in 1843 to accept gifts from individuals wishing to express their patriotism to the United States."

I encourage all like minded citizens (including the uber-rich such as Buffett, Munger, Gates, Soros,  Pelosi, Kerry, Feinstein, Rockefeller, Issa, Grayson etc.) to express their patriotism immediately by making a gift to the government instead of donating to charity. In fact, why wait for the Bush tax cuts to expire; send in extra money every month, every year. Also, consider setting up your estate plans to make the U.S. Government your sole beneficiary. It will make estate planning so much easier and get rid of those pesky problems with heirs.

Who is right, Ben or Linda?

HT: Carpe Diem

The Alfred E. Neuman School of Investing

Emotions are one of the toughest things to control in investing.  It's hard not to be euphoric when stock prices are soaring and want to dump a lot of money into the market on the assumption that stock prices will rise to the moon.  And likewise, it is difficult not to be depressed and despondent when prices are sinking to multi-year and you have a substantial paper loss-- the natural instinct is to cash in as fast as possible and move your money to a "safe" place.  Of course, there are no "safe" places and every thing you do with your money entails risk, whether hiding it in a mattress or investing in a T-bill.

The natural reactions to the scenarios above are the irrational reactions.  A rational investor would hoard cash when prices are high and buy with both fists when prices are low.  But how many people have that much control over their emotions?  Not many.

An approach that most investors can stomach is something I call the Alfred E. Neuman School of Investing.  Some of you may remember Alfred from Mad Magazine, a not too bright kid who is unconscious and unaware of what is going on around him.  To be a successful investor you have to tune out the noise all around you that causes euphoria and panic, and stick with your investment plan; you need to train your emotions to be in the "What, me worry?" camp.  The stock market never goes straight up or straight down, and it always recovers given time.  And time is your friend as an investor.

The Alfred E. Neuman law of investing might be defined as: investment returns decrease as motion increases.  When panic buying and selling crescendos, the average investor mistimes moves in the market and penalizes their own investment returns.  Sometimes it's better to be unconscious and unaware like Alfred E. Neuman, happily dollar cost averaging in both up and down markets.

Tuesday, September 28, 2010

Being Geek: The Software Developer's Career Handbook

Being Geek: The Software Developer's Career Handbook from lonelysandwich on Vimeo.

As a manager of software developers (no, not the one in the video), I've see many of the stereotypical behaviors, but few overcome their inner geek tendencies.

Peter Diamandis on the X PRIZE and Private Space Flight

His Zero Gravity Corporation lets the public experience weightlessness during parabolic flight, and his company Space Adventures has taken four tourists to the International Space Station.

But space entrepreneur Peter Diamandis may be best known as the chairman and CEO of the X PRIZE Foundation, which in 2004 awarded the $10 million Ansari X PRIZE to aviation icon Burt Rutan, whose SpaceShipOne was the first private, manned spacecraft to reach suborbital space twice within two weeks.

Diamandis is on a mission to open space for all humanity, and he embraces the risk inherent to such an undertaking. "A true breakthrough requires tremendous levels of risk," says Diamandis. "It's really in the entrepreneurial sector that people are willing to risk their lives, risk their fortunes, their reputations, to do something they fundamentally believe they can do."

Diamandis is now developing X PRIZES in a variety of fields, including education and medicine.


Stephen Hawking Hits Zero G

Taking the Next Giant Leap in Space

The Grouch: Pay special attention to Diamandis' comments on how regulation stifles innovation, and how government is an impediment to technological breakthroughs.

Monday, September 27, 2010

The EU is Regulating Itself into Irrelevance

This seems to be where the US is headed. It's pretty bad when a professional regulator thinks the level of regulation is ridiculous. Companies don't need more EU regulations to enable them to sell across borders. Maybe a free trade agreement is required for the EU countries.

The Grouch's Investor Manifesto

  1. I am an investor, not a speculator.  I invest in stocks, bonds and other assets for their long-term returns and to participate in the growth of the economy, and do not seek short-term gains in the casino of speculation.
  2. I am a net saver, not a debtor.  Part of each paycheck automatically goes toward investments, in addition to any other unneeded cash beyond what is required for my emergency fund.
  3. I have an investment plan written down on paper that includes personal and financial goals (the reasons that I am saving and investing) as well as an asset allocation strategy and a strategy to minimize taxes in my non-tax deferred accounts.
  4. I know that every investment entails risk, even bank deposits, CDs and government bonds whose value can be eroded by inflation or debased currencies.
  5. My asset allocation strategy mitigates the risks of investing through broad diversification, and preparing for both good and bad economic times.
  6. I seek out the lowest cost investment options that satisfy my asset allocation strategy, because I know cost is the greatest predictor of future performance, and I do not rely on star managers.
  7. I invest at regular intervals in both up and down markets and let dollar cost averaging work its magic.
  8. I do not invest in fads or the latest hot market.  I stick with my asset allocation strategy through thick and thin.
  9. I tune my asset allocation to match my risk tolerance.  As I get older with less time to recover from downturns, my asset allocation will get more risk adverse.
  10. I realize the stock market is risky in the short term but not too risky in the long-term.  I allocate to equities only what money I won't need for the next 3-5 years, and know that equities are necessary to achieve my portfolio growth targets and keep up with inflation.
  11. I rebalance my portfolio at least once a year, forcing myself to sell high and buy low to maintain the proper asset allocation for my risk tolerance.
  12. Foreign equities count for at least 30% of my equity portfolio.  I recognize that globalization and the growth of economic freedom around the world means the developed economies will not have a monopoly on growth.
  13. I never borrow against my 401K or investment portfolio.  If I don't have the cash for something, I don't need it, and I will not put my nest egg at risk for frivolous things.
  14. I have an emergency fund equal to 6 months of salary so that I can weather the bad times and deal with the unexpected without dipping into my investment accounts.
  15. I know my house is a place to live, not an investment.  As much as I may love and enjoy my house, it is not a retirement plan or a substitute for saving and investing.
  16. I stick with the plan and keep my cool even when others are loosing their heads.  The best bargains exist and the most money is made when a fire sale happens on Wall Street.  I will be ready to take advantage of those fire sales.
  17. I will participate in the long-term growth of human-kind, their genius and innovations, because I am an investor, a saver, and an optimist who believes goodness will always be rewarded.

Sunday, September 26, 2010

The UFCW and Wal-Mart: Working Stiffed

The Daily Show With Jon Stewart>
Mon - Thurs 11p / 10c
Working Stiffed
Daily Show Full EpisodesPolitical HumorTea Party
The United Food and Commercial Workers of Nevada pays temporary, non-union workers minimum wage (with no benefits) to protest and demand fair treatment and wages from Wal-Mart. A little hypocrisy here, perhaps?

Markets in Everything: "Democratic Prices," Venezuelan Style

Today Venezuelans go to the polls to see if Hugo Chavez can increase his hold over this country, in spite of the recession and a rampant crime wave that has touched many families.  The growing opposition to Chavez has prompted the state to get into the restaurant business to remind people where their priorities should lie.

To quote from the NY Times article:

Tucked into a corner on Plaza Bolívar is Café Venezuela, part of a chain of open-air restaurants established by the government this year. The cafe serves Venezuela-grown coffee and Venezuelan snacks like cassava bread at so-called solidarity prices, half or less than what customers would pay elsewhere.

Ideology is also on the menu. The cafes were created by Comerso, a state holding company for socialist enterprises, which also manages stores that sell everything from subsidized arepas, the crispy corn cakes that are the staple of the Venezuelan diet, to inexpensive Chinese cars. The branch in Plaza Bolívar replaced a clothing store that once occupied the same spot and was expropriated live on television by Mr. Chávez.

The planners behind the cafes have multiple objectives: to provide food and conviviality at democratic prices, to serve as commercial linchpins to renew some of the city’s most run-down districts and, not incidentally, to remind satisfied patrons of the government’s populist program in an election year.

Note it is the Times reporter, not a Venezuelan Chavista, who coins the phrase "democratic prices."

But the best part of the story is this:

Doris, 20, said she still planned to vote for Mr. Chávez and his list of congressional candidates. “Supporting Chávez is the best way to get a job,” she said. She is studying petroleum production and hopes the correct political views can help her land a job at the national oil company.

I guess that is called crony socialism.

However, there does seem to be some legitimate opposition to Chavez, but how many seats they can actually capture remains to be seen.
Grouch: I'm no fan of Chavez, and think he is causing massive long-term damage to the Venezuelan economy, and is harming the very people he claims to help.  I refuse to buy gas from Citgo gas stations because I don't not want the profits funneled to the Chavez regime.

HT: Kids Prefer Cheese

Bailout Nation Continues: U.S. Backs $30 Billion in Bonds to Stabilize Key Credit Union Institutions; Subprime Legacy

Two years after the peak of the financial crisis, the federal government is now bailing out a crucial part of the credit-union sector battered by losses on (you guessed it!) subprime mortgages.

Regulators announced Friday a rescue and revamping of the nation's wholesale credit union system, backed up by a federal guarantee valued at $30 billion or more. Wholesale credit unions don't deal with the general public but provide essential back-office services to thousands of other credit unions across the U.S. The majority of retail credit unions are sound, but they will have to help pay for the losses through special assessments over the next decade.

Friday's moves include the seizure of three wholesale credit unions, plus an unusual plan by government officials to manage $50 billion of troubled assets inherited from failed institutions. To help fund the rescue, the National Credit Union Administration plans to issue $30 billion to $35 billion in government-guaranteed bonds, backed by the shaky mortgage-related assets.

Officials claim the plan won't cost taxpayers any money. Still, it marks the latest intervention by the U.S. government into a financial system weakened by the real-estate bust. Bad bets on mortgage-backed securities have now killed five of the nation's 27 wholesale credit unions since March 2009. The federal government now controls about 70% of the total assets at such credit unions, and said the surviving institutions will be reined in so that they take fewer risks with their investments.

Bert Ely, a financial-industry consultant in Alexandria, Va., said regulators share some of the blame for the resulting mess, because wholesale credit unions were allowed to pursue a strategy that was "viable only because of what clearly has turned out to be excessive risk-taking."


Grouch: When will bailout nation end?  Were the regulators asleep at the wheel again when it came to monitoring the risk levels of these institutions?  If taxpayer money is being used to backstop and guarantee financial assets why are these institutions allowed to gamble at the casino?  If they are relying on taxpayer guarantees to attract deposits, they should be forced to invest in safer instruments even if it means lower rates of return for the depositors. 

Quote of the Day: Peter Schmuck

Isn't it great to live in a society where the penalty for lying to a congressman can be up to 30 years in jail, but the penalty for a congressman lying to you is another two years in office.
~ Peter Schmuck, a Baltimore Sun sports writer, concerning the indictment of Roger Clemens on lying to Congress about his steroid use.

Ain't Technology Grand, or Can It Be a Little Scary Too?

In a scene that could be straight out of a Tom Clancy novel, the Columbian military took out FARC #2 leader and top military commander Victor Julio Suárez Rojas, alias 'Jorge Briceño Suarez' or 'Mono Jojoy' by giving him a pair of boots with a GPS chip embedded in the heel.  This is a real story.  El Mono was a diabetic and suffered with foot problems.  The Columbian government intercepted a message coming from the jungle ordering special footwear and filled that order for him.  The rest is history.  Technology has come a long way since the CIA tried to knock off Castro with exploding cigars.

For those who don't know, FARC is a peasant army which has proclaimed itself as a revolutionary agrarian, anti-imperialist Marxist-Leninist organization of Bolivarian inspiration. It claims to represent the rural poor in a struggle against Colombia's wealthier classes, and opposes United States influence in Colombia (e.g. Plan Colombia), neo-imperialism, monopolization of natural resources by multinational corporations, and paramilitary or government violence. It funds itself principally through ransom kidnappings and taxation of the illegal drug trade.

Another item to ponder is that cell phone in your pocket or clipped to your hip has a GPS device in it also that can be used to track your movements and pinpoint your exact location.  Not that that would ever happen in a free society, but sometimes only the paranoid survive.

Sunday Verse: James Wright (1927-1980)

In Response to a Rumor That the Oldest Whorehouse in Wheeling, West Virginia, Has Been Condemned

I will grieve alone,
As I strolled alone, years ago, down along
The Ohio shore.
I hid in the hobo jungle weeds
Upstream from the sewer main,
Pondering, gazing.

I saw, down river,
At Twenty-third and Water Streets
By the vinegar works,
The doors open in early evening.
Swinging their purses, the women
Poured down the long street to the river
And into the river.

I do not know how it was
They could drown every evening.
What time near dawn did they climb up the other shore,
Drying their wings?

For the river at Wheeling, West Virginia,
Has only two shores:
The one in hell, the other
In Bridgeport, Ohio.

And nobody would commit suicide, only
To find beyond death
Bridgeport, Ohio.

~ James Wright

Saturday, September 25, 2010

Invasion of the Stink Bugs in Washington, D.C.

Brown marmorated stink bug
No, the title of this article does not refer to Congress returning from their summer break. Rather, it refers to the brown marmorated stink bug that is swarming through the D.C. metropolitan area destroying crops and vegetation.   This type of stink bug is an invasive species from Asia that has been in the area for about a decade.  The shield-shaped insects don't bite, but they decimate crops and infest homes - and they certainly lives up to their name, emitting a foul odor from their backsides when threatened or when they die.  Their numbers have reached epidemic proportions in parts of Pennsylvania and Maryland this year, and appear to be headed for other parts of the US.

Stink bugs pose no threat to humans other than their annoying smell and ability to squeeze through the tiniest crack to invade homes.  However, they can do major damage to crops.  They have a hollow, needle-like mouthpiece that pierces fruit and vegetables, injecting their saliva with a special enzyme that breaks down the fruit into a liquid.  Then the stink bug sucks the liquid out, leaving a dent or dimple behind.  Around my house, they have ruined my entire tomato crop this year, and left me nothing but a bunch of dimpled and shriveled tomatoes that are unfit to eat.

Unfortunately, stink bugs have no natural enemies in this country, so there is nothing to keep their population growth in check.  The Department of Agriculture is working hard to determine the insects weakness and vulnerabilities, but so far they have proven highly resistant to insecticides and their immediate goal is to formulate a list of recommendations for farmers before next growing season that will help limit crop damage.

For homeowners, little that can be done to prevent them from entering a dwelling except to caulk around all windows and seal all openings around doors as much as possible, not unlike what one would do the weatherproof a house..  If they get in your home, my advice is don't vacuum them up with your vacuum cleaner unless you want your whole house to smell like stink bugs.  The Grouch's secret formula is  a mixture of dishwashing liquid and water in a glass.  Just knock the stink bugs into that mixture and they will die within 30 seconds, and you will spare yourself a lot of unpleasantness.

Hollywood Hates Capitalism - Wall Street: Money Never Sleeps Edition

Oliver Stone's uber-villain Gordon Gekko is back in the new film Wall Street: Money Never Sleeps, which (surprise!) features greedy capitalists behaving badly. It might remind you of Avatar, Mission Impossible 2 or roughly a zillion other films in which capitalists destroy the environment, concoct killer viruses, harvest organs, and cover up murder in order to feed their lust of profit. Even when capitalism isn't the primary target, the representatives of commerce are often flat-out repulsive (think Jabba the Hutt).

Perhaps it's ironic that Hollywood filmmakers practice what they preach against. Sure he palls around with socialist dictators Fidel Castro and Hugo Chavez, but there's no doubt Oliver Stone hopes to rake in obscene profits with his new flick.

Friday, September 24, 2010

Tweety has an Epiphany While the UK Moves Closer to Full Blown Statism

In a rare moment of clarity, Chris Matthews utters the unutterable. Shame on him.


In a related, but very disturbing story, the UK's tax collection agency is putting forth a proposal that all employers send employee paychecks to the government, after which the government would deduct what it deems as the appropriate tax and pay the employees by bank transfer.

The proposal by Her Majesty's Revenue and Customs (HMRC) stresses the need for employers to provide real-time information to the government so that it can monitor all payments and make a better assessment of whether the correct tax is being paid.

Currently employers withhold tax and pay the government, providing information at the end of the year, a system know as Pay as You Earn (PAYE). There is no option for those employees to refuse withholding and individually file a tax return at the end of the year.

If the real-time information plan works, it further proposes that employers hand over employee salaries to the government first.

This certainly gives new meaning to the phrases "working for the government," and "welfare state." Let's hope the geniuses in Washington don't hear about this idea.

Indexing the Capital Gains Tax to Protect Taxpayers from Inflation

The capital gains tax is a perverse form of double taxation that should be abolished. This bad tax is especially damaging because families often are taxed on gains that are solely the result of inflation. This video explains how taxpayers could be protected by indexing the capital gains tax so the levy only applies to inflation-adjusted gains.

Tuesday, September 21, 2010

Edison2 Wins Mainstream Class of Progressive Insurance X Prize

Late last week it was announced that the Edison2 vehicle won the $5M X Prize for competition to create a production-capable, well-performing, low-emissions and safe 100+ MPG car. One hundred and eleven teams from 15 countries entered the competition a year ago. This car was developed in my hometown, which is more noted for fundamentalist preachers and the birthplace of the moral majority than a hotbed of high technology. The design combines sound physics with innovative design, to create a car that uses light weight and low aerodynamic drag to usher in a new era of automobile efficiency. The model that won is capable of holding 4 people and used a 1 cylinder, 250 cc engine that is capable of speeds over 100 mph and has a range of greater than 600 miles on its 6 gallon gas tank. The development team intends to use the prize money to create a production vehicle and is looking for a production site in Virginia, North Carolina, Ohio and Michigan.


Edison 2 X-Prize from Johnny St.Ours on Vimeo.

More About the X Prize

Monday, September 20, 2010

Timelapse Montage

Timelapse Montage from Mike Flores on Vimeo.

The nature scenes in this video are nothing short of breathtaking.

Sunday, September 19, 2010

Congressmen Weiner and Waxman Announce Hearings on TV Gold Dealers

Precious metals investing has always been a very speculative affair, and one fraught with risk for the investor of both price depreciation and unscrupulous dealers. Friday, Rep. Weiner and Rep. Waxman announced a hearing of the Subcommittee on Commerce, Trade, and Consumer Protection set for September 23rd to discuss legislation that would regulate gold-selling companies, an industry whose relentless advertising is now staple of cable television. In the announcement for these hearings Rep. Weiner singles out precious metals dealer Goldline for special attention:

• Goldline Grossly Overcharges For Their Coins

The average Goldline markup was 90% above the melt value of the coin. The largest markup on any coin was 208% above the melt value. Furthermore, the average Goldline markup is 47% higher than better-priced competitors, with some of the company’s markups going as high as 102% compared to its competitors on one of the coins they offered.

• Goldline Falsely Claims To Offer “Good” Investments

By selling gold at twice the melt value, the price of gold would need to double for consumers to break even on their “investment.”

• Goldline Salespeople Misrepresent Their Ability To Give “Investment Advice”

Sales people imply that they are “investment advisors” or “financial advisers” by offering investment advice, which insinuates that they have some sort of fiduciary responsibility to get you the most return on your investment.

However, since they are not licensed investment advisors, they have no such responsibility. In 2006, the Missouri Secretary of States' Office, Securities Division filed formal consent order against Goldline for exactly this reason and recovered over $200k for an elderly consumer that was ripped off.

• Goldline Plays off Public Fears of Government Takeover and Has Formed an Unholy Alliance with Conservative Pundits to Drive a False Narrative

Goldline employs several conservative pundits to act as shills for its’ [sic] precious metal business, including Glenn Beck, Mike Huckabee, Laura Ingraham, and Fred Thompson. By drumming up public fears during financially uncertain times, conservative pundits are able to drive a false narrative. Glenn Beck for example has dedicated entire segments of his program to explaining why the U.S. money supply is destined for hyperinflation with Barack Obama as president. He will often promote the purchase of gold as the only safe investment alternative for consumers who want to safeguard their livelihoods. When the show cuts to commercial break, viewers are treated to an advertisement from Goldline.

“Under this proposed legislation, gold dealers will have a much harder time preying upon the nest eggs of vulnerable consumers,” said Weiner. “It’s shameful that companies like Goldline are able to rip off consumers, use misleading and possibly illegal sales tactics, and deliberately manipulate public fears to sell gold coins at inflated prices.”

There are a number of very curious statements in that press release that go beyond the mere examination of business practices. Since the non-political allegations deal with excessive pricing by Goldline, let's do an informal survey of prices for common bullion coins from some major coin dealers:

Coin SpotGoldline Lear Capital KitcoBlanchard
1oz Amer. Gold Eagle$1,276.20$1,369.00$1,333.94$1,345.86$1,332.50
1oz Amer. Silver Eagle$20.80$29.95$23.07$22.89$23.41

It certainly appears that Goldline is consistently higher on prices than the other coin dealers, but not to the degree indicated in the press release on bullion. However, Goldline also sells numismatic coins, and it is much harder to determine fair pricing on these offerings, which can be significantly higher than the bullion price. Historically, some numismatic coins have also appreciated quite significantly.  If it is numismatic coins that are selling at over 200% of melt value, then Mr. Weiner may be in for an embarrassing public education. But this is a volatile area where the uninitiated should not tread. You can't get a price quote every second of the day, and determining true value is more than problematic.

An $1000 basket of gold mint state rare numismatic coins -- from 1970 to today -- is now worth a stunning $57,977. (Based on the CU Guide at
For example, a 1/2 oz 2010 American Golden Eagle certified MS-70 can be purchased from Goldline for $1160, while other sites advertise the same grade coin for roughly $750.  It is easy to see how people not versed in the coin market could be talked into paying a significantly higher price for graded coins than the market would bear.  An educated consumer is always the best defense against this kind of practice.

The most serious charge in my mind is that Goldline is misrepresenting their salesmen as "financial advisors." This implies a fiduciary responsibility to the customer.  Many readers will recall this as a central issue in the Goldman Sachs testimony before Congress, and an issue that the Congressmen in that hearing clearly did not understand. I believe this is the issue Goldline is most susceptible on, and much of the rest will just be political theater.

The conclusion of my informal survey is that Goldline's prices are higher than their competitors uniformly across the board, and the rational consumer who does their homework should shop elsewhere.  I can't confirm the claims of this press release, but I assume the Congressmen can back up their statements with more than one example.  When buying from precious metals dealers your guard must be up at all times, and you need independent research to confirm their claims--- caveat emptor.  Don't believe anything they tell you, and don't succumb to high pressure sales tactics.

When the gold bugs are swarming and the airwaves are filled with commercials and doomsday scenarios, it is time to sit on the sidelines.  When the gold bugs are all deflated and you hear very little about the metal, it is time to buy.  Though there are clearly political motives behind these hearings, it is interesting to note that Lear Capital, a sponsor of the Limbaugh radio show, is not called out in the press release.

In closing, here is one of the non-political shills pounding the table for gold by driving a "false narrative:"


Full Disclosure: The Grouch is not currently a customer of Goldline nor do I intend to be a customer of Goldline in the future. Spot prices of gold are freely available to the public and if I ever choose to buy gold bullion it will be from the company that has the combination of the lowest markup and lowest shipping fees, and one that posts their prices clearly on their website.

Sunday Verse: Carolyn Forche (1950-) The Colonel

The Colonel

What you have heard is true. I was in his house. His wife carried a tray of coffee and sugar. His daughter filed her nails, his son went out for the night. There were daily papers, pet dogs, a pistol on the cushion beside him. The moon swung bare on its black cord over the house. On the television was a cop show. It was in English. Broken bottles were embedded in the walls around the house to scoop the kneecaps from a man's legs or cut his hands to lace. On the windows there were gratings like those in liquor stores. We had dinner, rack of lamb, good wine, a gold bell was on the table for calling the maid. The maid brought green mangoes, salt, a type of bread. I was asked how I enjoyed the country. There was a brief commercial in Spanish. His wife took everything away. There was some talk of how difficult it had become to govern. The parrot said hello on the terrace. The colonel told it to shut up, and pushed himself from the table. My friend said to me with his eyes: say nothing. The colonel returned with a sack used to bring groceries home. He spilled many human ears on the table. They were like dried peach halves. There is no other way to say this. He took one of them in his hands, shook it in our faces, dropped it into a water glass. It came alive there. I am tired of fooling around he said. As for the rights of anyone, tell your people they can go f--- themselves. He swept the ears to the floor with his arm and held the last of his wine in the air. Something for your poetry, no? he said. Some of the ears on the floor caught this scrap of his voice. Some of the ears on the floor were pressed to the ground.

~ Carolyn Forche

Saturday, September 18, 2010

White House: 'Global Warming' Out, 'Global Climate Disruption' In

When first you don't succeed, it's time to change the language and the terms of the debate.  Since the science of global warming has been discredited at best, and at worst disproved, the only way to get cap and tax trade passed is to reframe the problem.  Will this tactic work?

White House science adviser John Holdren urged people to start using the phrase 'global climate disruption' during a speech last week in Oslo, echoing a plea he made three years earlier. Holdren said 'global warming' is a "dangerous misnomer" for a problem far more complicated than a rise in temperature.

This change in terminology is required because temperature change "isn't the most severe effect of changing climate. Changes to precipitation patterns and sea levels are likely to have much greater human impact than the higher temperatures alone," a 2008 NASA report said explaining why it avoids the term 'global warming.'

But hasn't "global climate disruption" been taking place since before man could walk on two legs? Why not just call it "the weather?" Is it not hubris and arrogance to even think that man could affect the weather? Or is there another agenda at play here? I don't know.

The Grouch is all about clean, affordable energy (especially if it comes about without government coercion and expensive mandates), and is a big believer that technology will only continue to make life on earth better for human kind. But it is only healthy and natural to be skeptical of eager do-gooders who have grand designs to separate people from their money.

I'll leave the final word on the weather... woops, global climate disruption to a little known writer and speech-maker from Missouri who now resides in New England, Mr. Mark Twain:
Yes, one of the brightest gems in the New England weather is the dazzling uncertainty of it. There is only one thing certain about it, you are certain there is going to be plenty of weather. [Laughter.] A perfect grand review; but you never can tell which end of the procession is going to move first. You fix up for the drought; you leave your umbrella in the house and sally out with your sprinkling pot, and ten to one you get drowned. [Applause.] You make up your mind that the earthquake is due; you stand from under, and take hold of something to steady yourself, and the first thing you know, you get struck by lightning. [Laughter.] These are great disappointments. But they can't be helped. [Laughter.] The lightning there is peculiar; it is so convincing when it strikes a thing, it doesn't leave enough of that thing behind for you to tell whether - well, you'd think it was something valuable, and a Congressman had been there. [Loud laughter and applause.]

The 3,000 Mile Oil Change Myth?

Who doesn't change their oil every 3,000 miles these days?  All the major oil change franchises and even the local mechanic place stickers on car windshields reminding drivers when their 3,000 miles are up, and it is time to fork out another 40 bucks or so for a change.  Is this a scam or just good advice to keep engines running smoothly and trouble free?

According to a recent article in the New York Times, this rule of thumb may no longer be necessary for cars manufactured in the past 5 - 7 years due to advances in engine design.  The new rule of thumb might be 5,000 miles for mainly city driving, and 7,500 miles for mainly highway driving.  A word of caution, though, always consult your owner's manual and follow the manufacturer's recommendations.  Jiffy Lube and others have been extremely successful in marketing the 3,000 mile number to their benefit, but consumers may be better served by extended the mileage between oil changes.

Friday, September 17, 2010

The Ukulele Orchestra of Great Britain - The Good, The Bad and The Ugly

The Ukes perform Ennio Morricone's classic, the Theme from The Good, The Bad and The Ugly, from the DVD 'Anarchy in the Ukulele.' A fitting summary for the economy in 2010.

Happy Constitution Day

Never has it been more important for US citizens to rededicate themselves to understanding the constitution, classical liberalism (the polar opposite of modern liberalism), and the intent of the founding fathers.

Geithner Needs 'Reality TV Show': Bernie Marcus, Co-founder of The Home Depot

This segment is just too juicy not to post. Marcus hits the ball out of the park in his analysis of the current state of small business, echoing many of my sentiments. Years of foolish government regulations at the federal, state and local levels have all but destroyed the job creation engine of small business. Marcus suggests that the American economy would be better off if Congress would go into recess for the next two years (something I definitely agree with). The small business loan bill will do little to help small business since they do not have problems with loan availability. Their problems are that the cost of regulation and the slow down in consumer spending is forcing them to trim their work forces. Marcus backs up his talk with real world examples from people he knows.

In a scathing criticism of government, Marcus suggested that Treasury Secretary Timothy Geithner should have a reality-TV show about small business to illustrate how out of touch government policies are with the private sector. Geithner would have to deal first hand with the state, federal and local regulations that stymie business, and then public officials can understand the challenges that small business people face.

He stated that George W. Bush started the spending, but “he’s a novice when it comes to this new guy. They write checks for $10 million the way I write checks for breakfast.” He added that Fannie Mae and Freddie Mac continue to hurt the country. “Eventually [Rep.] Barney Frank [D-Mass.] is going to tell people who are on unemployment ‘You can have a house for $250,000, don’t worry about it because we’re going to finance it anyway.’ This is where we’re going. And someone has to say ‘Stop, no more.’ These are two organizations that are basically not run business-like. They aren’t intelligent, they aren’t bright, they brought us to the brink of disaster.”

He also took aim at Republicans—"Some are crazy." —and Goldman Sachs and the rest of Wall Street, whose work in derivatives has also hurt the country.

Exactly Who Got Stimulated by the Stimulus Program?

The numbers speak for themselves.  The biggest beneficiaries were Federal government employees and state employees.

Thursday, September 16, 2010

Firefox 4: Panorama Search Concept Finds and Pull Up Tabs As You Type

Firefox Panorama Search: Proof Of Concept from Aza Raskin on Vimeo.

Firefox 4 will sport Panorama, an awesome tab management system originally dubbed Tab Candy. A proof of concept search interface for Panorama demonstration looks like the perfect thing for those with a lot of web stuff going at once.

Watch the video to see how it's done. You start typing, and any tab with a name, or contents, matching what you've typed is highlighted, and then easy to pull up with an Enter press or a click. It's a great extension of Tab Candy/Panorama, and I hope it makes it into Firefox 4's final release.

Time Magazine Calls the Bottom of the Housing Market?

For those who believe that magazine covers are great contrarian indicators, this September Time magazine cover reflects enough pessimism to call the bottom of the US housing market.


From a letter sent to President Bush by Barney Frank, Nancy Pelosi, Maxine Waters and 73 other Congressional Democrats on June 28, 2004:

"We urge you to reconsider your Administration's criticisms of the housing-related government sponsored enterprises (the GSEs) and instead work with Congress to strengthen the mission and oversight of the GSEs. We write as members of the House of Representatives who continually press the GSEs to do more in affordable housing.

"Until recently, we have been disappointed that the Administration has not been more supportive of our efforts to press the GSEs to do more. We have been concerned that the Administration's legislative proposal regarding the GSEs would weaken affordable housing performance by the GSEs, by emphasizing only safety and soundness. While the GSEs' affordable housing mission is not in any way incompatible with their safety and soundness, an exclusive focus on safety and soundness is likely to come, in practice, at the expense of affordable housing.

"Our position is not based on institutional loyalty, but on concern for the GSE's affordable housing function. We appeal to you to agree to work on legislative proposals that foster sound oversight and vigorous affordable housing efforts instead of mounting assaults in the press. We also ask you to support our efforts to push the GSEs to do more affordable housing. Specifically, join us in advocating for more innovative loan products and programs for people who desire to buy manufactured housing, similar products to preserve as affordable and rehabilitate aging affordable housing, and more meaningful GSE affordable housing goals from HUD.

"In closing, we reiterate that an exclusive emphasis on safety and soundness, without an appropriate balance in focus on the affordable housing mission of the GSEs, is misplaced."

The Grouch:  The above graph reflects the conditions of the housing market in 2004 when the letter was sent from Congress to then President Bush:

  1. Homeownership was at an all-time historical high of 69.2% in the second quarter of 2004, and had increased by more than 5% from 63.9% in the first quarter of 1991.
  2. Home prices had been inflating at a rate far greater than the general price level for almost a decade, as the unsustainable housing bubble was on its way to the 2007 peak in home prices.  At the time the letter was written in 2004, home prices had appreciated by 85.4% since 1991, which was more than twice the 39.6% increase in the CPI over that period.  Historically home prices appreciate in line with CPI.
  3. At the time homeownership was peaking and home prices were close to peaking, both at unsustainable levels, the politicians in 2004 were still pushing for the "ownership society" and all of the policies that eventually caused the global financial crisis, mortgage tsunami, and housing bubble: affordable housing through lower down payments, looser underwriting standards and higher leverage (Of course, when the financial crisis hit in 2007-2009 they all came down with a bad case of amnesia).
Five years later in 2009, the U.S. House of Representatives Committee on Oversight and Government Reform concluded that: "The consequences of these policies [the political obsession with homeownership] have brought the entire global financial system to the brink of collapse, destroying trillions in equity and untold numbers of lives. It is essential to reexamine the borrow-and-spend, high-leverage policies that became prevalent in the mortgage market as a result of well-intentioned-but-reckless decisions made by elected officials on behalf of the American people."

I couldn't agree more with these conclusions.  In fact, I don't see how we can have any serious financial reform in this country until the link between housing and politicians is broken for good.  Fannie and Freddie need to be broken up into a "good bank/bad bank," so the bad bank could be wound down and the good bank broken up into multiple pieces and privatized-- no more GSEs with private profits and public losses subject to political manipulation.  But I don't think the politicians willingly give up this type of power.  What do you think?

HT: Carpe Diem

    Monday, September 13, 2010

    Why Google Voice Spells Big Trouble for Verizon and AT&T

    Over the past several months, I've read a number of posts in the blogsphere stating what juicy dividends AT&T and Verizon supported and how based on historical dividend trends that these stocks were dirt cheap, and while they weren't fast growers they didn't deserve these price levels.  Of course, I beg to differ.  I believe their businesses are undergoing stiff competition and are in grave danger of shrinking over the long term along with their ability to continue paying such generous dividends.

    The Google Voice integration with Gmail is just the latest nail in coffin as far as I am concerned.  Copper wire telephone technology is now 125 years old, and is on a downward trajectory due to technological obsolescence as cell phones and VoIP alternatives become the communications vehicles for the younger generation.

    The telco strategy in a nutshell has been to invest heavily in wireless to make up for the loss of their copper wire customers, and begin offering triple play packages of VoIP, internet and TV services to compete against VoIP only providers like Vonage and, more importantly, the cable companies who are aggressively moving into this space.

    Until recently this appeared to be a solid game plan, with steady growth in wireless revenues due to subscriber growth and demand for wireless data services coupled with a healthy pricing environment.

    However, the picture is now changing.  The wireless market is starting to become saturated; growth is slowing for both voice and data services.  This has trigger a brutal price war with AT&T and Verizon following Sprint's lead in offering reasonably priced voice and data plans.  In addition, demand for monthly voice-over-IP plans has easily outpaced per-minute plans with much of the subscriber growth going to cable giants such as Comcast and Time Warner Cable.

    To make matters worse, the spread of dirt cheap VoIP alternatives that can use the 3G or 4G data services provided by the telcos has given cost conscious consumers a way to place calls without adding minutes by upgrading to a more expensive service plan.

    Google Voice has now positioned itself to be an even bigger headache than Skype.  Having already annoyed wireless carriers by offering free text messaging and other services, Google has now offers free phone calls within the U.S. and Canada using a phone application built into Gmail.  Google is currently offering this feature via PC-based web-browsers, but it is not a stretch to see them integrated this feature into Android based phones.  Even if free calling remains a PC-only feature, it will still cause serious problems for wireless carriers by reducing the number of wireless minutes their subscribers use, and potentially eliminating the need for a landline connection.

    Studies indicate the percentage of American households relying only on a wireless connection has soared from 15.2% as of March 2007 to 29.7% as of June 2010, and is only headed higher.  Landline cancellations having actually picked up in recent quarters, and the nonstop bleeding for AT&T and Verizon in their local voice revenue bases will continue for quite some time.  With the emerging wireless price war and the spread of rediculously cheap voice-over-IP services, the telcos can count on their wireless divisions to save their bacon from the gradual demise of their landline monopolies.  It is an ugly long-term picture for these companies.

    I'm not so sure the future is very bright for the cable companies either.  I can easily see the telcos and cable companies reduced to competing for wireline and wireless Internet connectivy as all phone service moves to these cheap VoIP alternatives.  In addition, I've spent much of the past two weeks watching US Open tennis on my computer.  The purpose of this post was not to discuss IP television, but that is an emerging technology that will probably do to the cable companies what VoIP has done for the telcos.

    The Grouch has disconnected all landlines into his house and now relies exclusively on google voice through his PC and a low cost cell phone.

    Saturday, September 11, 2010

    Sunday Verse: Galway Kinnell (1927-) When the Towers Fell

    When the Towers Fell

    From our high window we saw the towers
    with their bands and blocks of light
    brighten against a fading sunset,
    saw them at any hour glitter and live
    as if the spirits inside them sat up all night
    calculating profit and loss, saw them reach up
    to steep their tops in the until then invisible
    yellow of sunrise, grew so used to them
    often we didn’t see them, and now,
    not seeing them, we see them.

    The banker is talking to London.
    Humberto is delivering breakfast sandwiches.
    The trader is already working the phone.
    The mail sorter has started sorting the mail.
             ...povres et riches
    Sages et folz, prestres et laiz
    Nobles, villains, larges et chiches
    Petiz et grans et beaulx et laiz1

    The plane screamed low down lower Fifth Avenue
    lifted at the Arch, someone said, shaking the dog walkers
    in Washington Square Park, drove for the north tower,
    struck with a heavy thud, releasing a huge bright gush
    of blackened fire, and vanished, leaving a hole
    the size and shape a cartoon plane might make
    if it had passed harmlessly through and were flying away now,
    on the far side, back into the realm of the imaginary.

    Some with torn clothing, some bloodied,
    some limping at top speed like children
    in a three-legged race, some half dragged,
    some intact in neat suits and dresses,
    they straggle out of step up the avenues,
    each dusted to a ghostly whiteness,
    their eyes rubbed red as the eyes of a Zahoris,
    who can see the dead under the ground.

    Some died while calling home to say they were O.K.
    Some died after over an hour spent learning they would die.
    Some died so abruptly they may have seen death from within it.
    Some broke windows and leaned out and waited for rescue.
    Some were asphyxiated.
    Some burned, their very faces caught fire.
    Some fell, letting gravity speed them through their long moment.
    Some leapt hand in hand, the elasticity in last bits of love-time letting — I wish
    I could say — their vertical streaks down the sky happen more lightly.

    At the high window, where I’ve often stood
    to escape a nightmare, I meet
    the single, unblinking eye
    lighting the all-night sniffing and lifting
    and sifting for bodies, pieces of bodies, anything that is not nothing,
    in a search that always goes on
    somewhere, now in New York and Kabul.

    She stands on a corner holding up a picture
    of her husband. He is smiling. In today’s
    wind shift few pass. Sorry sorry sorry.
    She startles. Suppose, down the street, that headlong lope...
    or, over there, that hair so black it’s purple...
    And yet, suppose some evening I forgot
    The fare and transfer, yet got by that way
    Without recall — lost yet poised in traffic.
    Then I might find your eyes...

    It could happen. Sorry sorry good luck thank you.
    On this side it is “amnesia,” or forgetting the way home,
    on the other, “invisibleness,” or never in body returning.
    Hard to see clearly in the metallic mist,
    or through the sheet of mock reality
    cast over our world, bourne that no creature ever born
    pokes its way back through, and no love can tear.

    The towers burn and fall, burn and fall —
    in a distant, shot, smokestacks spewing oily earth remnants out of the past.
    Schwarze Milch der Fruhe wir trinken sie abends
    wir trinken sie mittags und morgens wir trinken sie nachts
    wir trinken und trinken2

    This is not a comparison but a corollary,
    not a likeness but a lineage
    in the twentieth-century history of violent death —
    black men in the South castrated and strung up from trees,
    soldiers advancing through mud at ninety thousand dead per mile,
    train upon train headed eastward made up of boxcars shoved full to the
    corners with Jews and Gypsies to be enslaved or gassed,
    state murder of twenty, thirty, forty million of its own,
    atomic blasts wiping cities off the earth, firebombings the same,
    death marches, starvations, assassinations, disappearances,
    entire countries turned into rubble, minefields, mass graves.
    Seeing the towers vomit these black omens, that the last century dumped into
    this one, for us to dispose of, we know
    they are our futures, that is our own black milk crossing the sky: wir shaufeln
    ein Grab in den Luften da liegt man nicht eng3

    Burst jet fuel, incinerated aluminum, steel fume, crushed marble, exploded
    granite, pulverized drywall, mashed concrete, berserked plastic,
    gasified mercury, cracked chemicals, scoria, vapor
    of the vaporized — wafted here
    from the burnings of the past, draped over
    our island up to streets regimented
    into numbers and letters, breathed across
    the great bridges to Brooklyn and the waiting sea:
    astringent, miasmic, empyreumatic, slick,
    freighted air too foul to take in but we take it in,
    too gruesome for seekers of the amnesiac beloved
    to breathe but they breathe it and you breathe it.

    A photograph of a woman hangs from a string
    at his neck. He doesn’t look up.
    He stares down at the sidewalk of flagstone
    slabs laid down in Whitman’s century, gutter edges
    rasped by iron wheels to a melted roundedness:
    a conscious intelligence envying the stones.
    Nie staja sie, sa.
    Nie nad to, myslalem.
    zbrzydziwszy sobie
    wszystko co staje sie4

    And I sat down by the waters of the Hudson,
    by the North Cove Yacht Harbor, and thought
    how those on the high floors must have suffered: knowing
    they would burn alive, and then, burning alive.
    and I wondered, Is there a mechanism of death
    that so mutilates existence no one
    gets over it not even the dead?
    Before me I saw, in steel letters welded
    to the steel railing posts, Whitman’s words
    written as America plunged into war with itself: City of the world!...
    Proud and passionate city — mettlesome, mad, extravagant city!

    words of a time of illusions. Then I remembered
    what he wrote after the war was over and Lincoln dead:
    I saw the debris and debris of all the dead soldiers of the war,
    But I saw they were not as was thought.
    They themselves were fully at rest — they suffer’d not,
    The living remain’d and suffer’d, the mother suffer’d
    And the wife and the child and the musing comrade suffer’d...

    In our minds the glassy blocks
    succumb over and over into themselves,
    slam down floor by floor into themselves.

    They blow up as if in reverse, exploding
    downward and outward, billowing
    through the streets, engulfing the fleeing.

    As each tower goes down, it concentrates
    into itself, transforms itself
    infinitely slowly into a black hole

    infinitesimally small: mass
    without space, where each light,
    each life, put out, lies down within us.

    ~ Galway Kinnell


    1 ...poor and rich
    Wise and foolish, priests and laymen
    Noblemen, serfs, generous and mean
    Short and tall and handsome and homely

    2 Black milk of daybreak we drink it at nightfall
    we drink it at midday at morning we drink it at night
    We drink it and drink it

    3 we’re digging
    a grave in the sky there’ll be plenty of room to lie down there

    4 They do not become, they are.
    Nothing but that, I thought,
    now loathing within myself
    everything that becomes.

    Quotations: “The Testament,” by François Villon; “For the Marriage of Faustus and Helen,” by Hart Crane; “Death Fugue,” by Paul Celan; “Songs of a Wanderer,” by Aleksander Wat; “City of Ships” and “When Lilacs Last in the Door-yard Bloom’d,” by Walt Whitman.

    Beautiful Minds: Stephen Wiltshire - The Human Photograph

    Simply amazing. This reminds me of one of my favorite TV shows on the History Channel-- Stan Lee's Superhumans.

    Are Illegal Immigrants Propping Up the Social Security System?

    I've written in other posts on this blog how Social Security is little more than a government sponsored Ponzi scheme where earlier "investors" get paid off by the contributions of late "investors."  And how Congress has turned it into a giant slush fund to tap into as an additional spending source, and their IOUs to the fund are kept in a binder in Parkersburg, WV.  Anyone who thinks Social Security works like a 401k where their money is set aside in an account just for them and the government is looking out for their best interests really needs to take the time to understand how the program works.

    It's also no secret to anyone who has been paying attention to such issues over the past 30 or more years that Social Security is in trouble due to changing demographics (less people working, more people retired), longer average lifespans, longer retirements, and more generous benefits than previous generations received.  To deal with these issues it is very likely that the retirement age will have to be raised in the future and benefits frozen or cut to keep the program solvent.

    To make matters even worse, an article this week in the Washington Post of all places reveals that an internal Social Security Administration study has determined in 2007 illegal immigrants contributed somewhere between 5.4% to 10.7% of the trust fund's total assets of $2.24 trillion that year.  Many of them are using a Social Security number tied to an invented name or one that belonged to someone else. Of the rest, many got legal cards when they entered the country under a temporary work visa. They stayed illegally after their visas expired.

    Can you imagine what condition Social Security would be in without illegal immigrants?  As one Social Security official puts it: "If for example we had not had other-than-legal immigrants in the country over the past, then these numbers suggest that we would have entered persistent shortfall of tax revenue to cover [payouts] starting [in] 2009, or six years earlier than estimated under the 2010 Trustees Report."

    The irony here, according to the Post and the Feds, is that illegal immigrants tend to pay Social Security taxes but don’t collect benefits, while legal immigrants tend to collect more in Social Security benefits than they pay in taxes.  This begs the question, are illegal immigrants necessary to keep the social safety net of the US Government solvent?  Is that why the Feds seem to turn a blind eye to illegal immigration?

    The other irony is that granting amnesty to illegal immigrants would eliminate these gains to Social Security by allowing them to collect Social Security benefits in exchange for their taxes.  A classic Catch-22 situation that has no easy answer.

    What do you think?  Should we just keep ignoring illegal immigration and collecting their tax dollars to prop up the faltering Social Security system?

    Thursday, September 9, 2010

    Castro Says Cuban Model Doesn't Work Any Longer

    As the sun starts to set on the Castro brothers rule over Cuba, Fidel recently admitted to a visiting American journalist that the Cuban model of Communism doesn't work any longer, a rare admission for someone who has stayed out of the spotlight for the past four years.  The fact that cash-strapped Cuba is going through hard economic times is nothing new.

    Even after the fall of the Soviet Union, Cuba has clung to its communist system.  The state controls over 90 percent of the economy, paying workers salaries of roughly $20 a month in return for free health care and education, and nearly free transportation and housing. A portion of every citizen's food needs are sold to them through ration books at heavily subsidized prices. President Raul Castro and others have instituted a series of limited economic reforms, warning Cubans that they need to start working harder and expecting less from the government. But the president has also been clear he has no desire to depart from Cuba's socialist system or embrace capitalism.


    Grouch:   Now if we can only get this message to certain people in government, both elected and appointed, and to the Hollywood types like Michael Moore and Oliver Stone who keep churning out propaganda.  As a libertarian, I've always though the quickest way to bring about the downfall of Cuban communism is to completely open up political and economic relations with Cuba.  Once the people get a taste of freedom and the prosperity it brings, they will gradually move away from Communism and the near complete dependence on government in all aspects of their lives.  No longer will the rallying cry be: "90 miles to freedom."

    Walmart and Sam's Club to Offer $24 Flu Shots

    Here in Grouchville economics are pretty simple.  You can't reduce health care costs with a third party payer system where the customer is unaware of the true cost of the service.  True savings and market driven health care decision making comes when the customer is directly engaged with the provider, knows the price of the service up front, and can decide if it is in their economic self-interest to pay for that service.  Third party payer systems, whether insurance companies of the government, short-circuit market forces and rational decision making by customers, and add extra costs and overhead. In Grouchville, there are many entities like Wal-Mart, and Walgreens that offer medical services at a low price for cash on a walk-in basis, and the competition is fierce.

    Earlier this month, Wal-mart and Sam's Club announced they will be offering $24 flu shots administered by Mollen Immunization Clinics at more than 4,100 select stores and clubs nationwide. Customers can visit or to find specific dates, times and locations for the flu vaccination clinics.