Sunday, December 31, 2006

Another View of the Saddam Hussein Execution writer Juan Cole seems to think that Saddam's death was about revenge and not justice.

And, based on what Mr. Cole says, it appears that the execution had more religious significance than first thought:

The tribunal also had a unique sense of timing when choosing the day for Saddam's hanging. It was a slap in the face to Sunni Arabs. This weekend marks Eid al-Adha, the Holy Day of Sacrifice, on which Muslims commemorate the willingness of Abraham to sacrifice his son for God. Shiites celebrate it Sunday. Sunnis celebrate it Saturday –- and Iraqi law forbids executing the condemned on a major holiday. Hanging Saddam on Saturday was perceived by Sunni Arabs as the act of a Shiite government that had accepted the Shiite ritual calendar.

It certainly should not be the policy of the U.S. to promote religious divisions, whether intentional or not.

Asia Times Commentator Bearish

Global economy faces a dangerous year
By Jephraim P Gundzik

From the article:

America’s economic fairytale has turned into a nightmare and very few investors realize it. In addition to producing a sudden and sharp decline in household income by eliminating the prospect of new mortgage refinancing for many Americans, declining prices for new and existing homes will have a strong negative impact on the US financial system, severely restraining credit growth. Falling home prices, especially in what were once the hottest housing and mortgage markets in the US, have caused mortgage default rates and foreclosures to surge higher.

The combination of rising defaults, foreclosures and falling collateral values is beginning to weaken the balance sheets of mortgage lenders, including several of America’s largest banks. Growing weakness in the banking sector is very alarming. Banking sector and economic crises in many countries over the past 25 years can be traced to overly enthusiastic credit growth used to finance either capital investment or real estate speculation, or both. Japan offers a stunning example of what can happen after a real estate bubble bursts.

The Federal Reserve appears determined to let financial markets “self-correct” in order to adjust interest rates to changing expectations for economic growth and inflation. Self-correction is a defining feature of financial markets. However, with the Fed rudderless, it is very unlikely that this self-correction will occur in an orderly and gradual manner. Rather, such self-correction will be sudden and sharp.

This is very similar to what bloggers Mike Shedlock (Mish's Global Economic Analysis), Barry Ritholtz (The Big Picture) and Charles Smith (Of Two Minds) have been saying. Calculated Risk leaves it open as a possibility. The Housing Bubble Blog is warning about such a collapse in housing.

Mr. Gundzik is just one opinion from Asia. Other than Fox News, I don't know of any commentators that are taking a contrary view. Does this view represent the consensus of the investment community? It's that "such self-correction will be sudden and sharp" that has me leery of investing in the stock market right now.

Should Mortgage Brokers Steer People Away from High-risk Loans?

Elizabeth Warren asks the question: "If stock brokers must help investors with $100,000 to invest in the stock market avoid certain risks, should mortgage brokers be required to do the same for those borrowing $100,000 to buy a home?"

Click on the title link to see her argument for it.

Saturday, December 30, 2006

Is this a Teapot Dome Scandal part deux?

From the New York Times:

WASHINGTON, Dec. 29 — The Justice Department is investigating whether the director of a multibillion-dollar oil-trading program at the Interior Department has been paid as a consultant for oil companies hoping for contracts.

The director of the program and three subordinates, all based in Denver, have been transferred to different jobs and have been ordered to cease all contacts with the oil industry until the investigation is completed some time next spring, according to officials involved.

The officials, who spoke on condition of anonymity because the investigation had not been announced publicly, said investigators were worried that senior government officials had been steering huge oil-trading contracts to favored companies.

Any such favoritism would probably reduce the money that the federal government receives on nearly $4 billion worth of oil and gas, because it would reduce competition among companies that compete to sell the fuel on behalf of the government.

If the allegations prove correct, they would constitute a major new blot on the Interior Department’s much-criticized effort to properly collect royalties on vast amounts of oil and gas produced on land or in coastal waters.

The Interior Department’s Minerals Management Service, which oversees royalty collections, is now the target of multiple investigations by Congress and the Interior Department’s inspector general.

Those investigations are focused on allegations that the agency ordered its own auditors to abandon claims of cheating by large oil companies; that the agency’s arcane rules for calculating sales value and royalties make it easier for companies to understate their obligations; and that the agency’s basic sources of data are riddled with inaccuracies and are unreliable.

Lex Taliones

Lex Taliones: literally, "Law as Revenge" (also known as "an eye for an eye").

News came late last night that Saddam Hussein was executed last night for crimes against humanity. I am still sorting out my feelings about the matter. One the one hand, I am not opposed to the death penalty; on the other hand, I think it should be used in only the most extreme circumstances. Having said that, lex taliones is not, in my mind, a good justification for the death penalty. I think that the death penalty should only be used as a means of protecting the public when no other means can be used.

I'll admit it is possible that Saddam was one of those cases. It is well-known that Saddam liked the Godfather movies and wanted to emulate the somewhat fictionalized crime-boss figure when he ruled Iraq. There is no doubt that Saddam was a bad guy and hurt -- even killed -- a lot of people wrongfully. But the question that Thomas Friedman of the New York Times asked was never answered: "is Saddam the way he is because Iraq is what it is, or is Iraq the way it is because Saddam is who he is?"

As I write this, I think of the short story The Lottery. And I wonder if Saddam Hussein became the scapegoat for an endemic problem in Iraq's culture. What if we find out that anyone who vies for power in Iraq simply becomes another Saddam-like figure?

The violence in Iraq has only gotten worse since we invaded. Law and Order have never effectively been established. You can say that it is partially our fault for taking in "just enough troops to lose." The country is falling, or has fallen, into civil war. Many Americans, like myself, cannot fully comprehend how people can have differences so great that they would be willing to kill entire neighborhoods -- even cities -- of residents because differences in race, tribal affiliation or religious beliefs. However, here in America we had a civil war over the issue of slavery -- which at the time had a connection to Southern Christians' reading of passages in the Bible that slavery was acceptable; and we enslaved an entire race of people because of the endemic belief that that race was inferior. We have come a long way since then.

Based on how things are playing out, things will only get worse in Iraq before they get better. That is, if they ever do.


A commentator over at Daily Kos who is from Cairo, Egypt, pointed out that the execution was carried out "on the most important feast in the Muslim calendar: Eid al-Adha, or Feast of the Sacrifice." He continued: "My neighbors here in Cairo must have been slaughtering their sheep just as the trap door opened. I wonder if they appreciate the irony."

Friday, December 29, 2006

Universal Health Care is the Answer

Poster Red Planet has made a comment on Universal Health Care over at Warren Reports. From his post:

Universal, single-payer health care (definitely NOT the industry plan) will free up hundreds of millions of dollars currently used unproductively to fund competing private health bureaucracies, their duplication of efforts, mass confusion, profits, coverage exclusions, payment dodges and legal entanglements. Universal, single-payer health care will relieve American employers of the unreasonable and unconscionable requirement to be the provider of good health for their employees, and free them to focus their human and financial resources on becoming better global competitors.

That's the crux of the issue. Insurance is supposed to be about shared risk. But the game among private insurers is to accept risk only from those who are at the least risk, and shun those who are at the greatest risk. So long as the game is competition among private employers and their private insurers, and the incentives for both are to shun risk, you can bet that those most at risk will have no coverage, or, if they do, their coverage will disappear as soon as those chronic symptoms take over their lives. Soon they, too, will be on Medicaid.

The only fair, equitable, practical and affordable health care system entails universal risk sharing, which results in a single-payer system.


You know, as I think about this, doesn't this sound like a kind of moral hazard that benefits health insurance companies?

New Bankruptcy Law Makes Credit Counselors Lose Money

From Credit Slips Blog:

The big news is the funding deficit the agencies report from providing bankruptcy-related counseling. Waivers of fees were given in about 15% of cases, and apparently even when fees are collected for pre-filing counseling, the agencies report a shortfall of about $12 in providing each session.

Yeah, but will they lobby Congress to repeal the new law? Probably not.

Thursday, December 28, 2006

Is America Finally Ready for National Health Care?

From the article:

Few mention this, but the American healthcare system is something of a mistake. It blossomed out of a World War II tax reform meant to guard against corporate war profiteering. Liberals, with their usual combination of good intentions and inadequate foresight, imposed massive marginal tax rates on corporations, effectively freezing their profits at prewar levels. But the law had a loophole: Corporations could funnel their wartime riches into employee benefits, such as healthcare, thus putting the cash to use within their company. And so they did, creating the employer-based healthcare system.

But healthcare was simpler in the 1940s, and far less expensive. In the 21st century, it's not simple at all. Once a perk of employment, health insurance is now a necessity, and a structure that dumps such power, complexity and cost in the laps of employers is grotesquely unfair to both businesses and individuals. There's no logic to an auto manufacturer running a multibillion-dollar health insurance plan on the side; it should stick to making cars. There's no excuse for pricing the self-employed and entrepreneurial out of the market. And there's no reason the owner of a three-employee start-up should have to go to bed with a heavy conscience because his coffee shop can't pay for chemotherapy.

But health insurance is not only the inexplicable responsibility of business; it is a big business, which is why the system survives. The medical-industrial complex is a massive, remarkable beast, consuming a full one-ninth of the American economy and offering astonishing profits to many of the participants (indeed, Big Pharma was the most profitable industry in the U.S. from the 1980s until 2003, when energy companies wrested away the top spot). As with any lucrative industry, the winners are resistant to reforms, and they have a formidable army of politically lobbyists, PR specialists and image consultants helping to preserve their position, to preserve a mistake.


Surrounded by an unlikely array of union leaders and corporate chief executives, Sen. Ron Wyden (D-Ore.) has unveiled an inventive, comprehensive reform plan that would end the employer system forever. What businesses pay in employee premiums would be redirected to employee raises; insurers would offer their plans through state associations that would no longer allow price discrimination for reasons of health or job status; and everyone would have to buy in. Universal coverage would be achieved in under two years.

The most compelling evidence that resistance to reform is futile, however, is coming from the insurers themselves. Cognizant that Congress and the nation are tiring of the current dystopia, the insurance industry recently released its own plan for universal healthcare.

It's a bad plan, to be sure. Its purpose is more to preserve the insurance industry's profits than improve healthcare in this country. But the endorsement of universality as a moral imperative, and the attempt to get in front of the coming efforts at reform, mark the emergence of a distinct rear-guard mentality within the insurance industry. Their game is up, and they're turning some of their attention to shaping their future rather than betting that they can continue protecting their present.


Insurers want to retain their ability to discriminate against the ill and the old; conservatives want individuals to assume more risk and expense in order to force wiser health decisions; liberals want the government to guarantee universality and utilize its massive market power to bargain prices down to levels approximating those paid by other developed countries.

What's important, though, is that for the first time since the early years of the Clinton administration, these arguments are being made, and employers, insurers, politicians and, most crucially, voters are making their way back to the table.

The realization that our illogical, mistaken healthcare system can't go on forever has dawned, and so it will end. The question now is what replaces it.

No matter what you call it: national health care, universal health care / insurance, they are all basically the same concept. This is an idea whose time has come. The sooner we can get it, the better off we will be.

Debt Levels Rise Again

The Northern Trust, an investment management company, has put out a opinion paper in response to the Federal Reserve's flow-of-funds report. It can be found here.

From the paper:

Some might respond that with all the different sources of credit available to households today, they do not need to hold as large a ratio of liquid assets as in the past. To this I would respond with three counter-arguments. Firstly, households already have borrowed so much that their leverage ratio is at a post-WWII high (see Chart 13). Secondly, households have already borrowed so much that their debt service burden is at a 25-year record high (see Chart 14). And thirdly, residential real estate, which accounts for 30.5% of the total market value of household assets (see Chart 15), is the single largest asset in households’ portfolios compared with deposits, credit market instruments, corporate equities (about 44% of which are held on their behalf in pension funds and insurance companies) and other tangible assets. Of these other asset categories, residential real estate probably is the least liquid, aside from used refrigerators (other tangible assets). In sum, households have never been as highly levered as they are now or as illiquid as they are now, and their single largest asset is in danger of actually falling in value.

Wednesday, December 27, 2006

The New Apprentice

During the Christmas break, I did some resting and watched a little TV. A new commercial for Donald Trump's The Apprentice came on. According to the commercial, the winners get to live in a lavish mansion, while the losers will be destined to live in tents in less than ideal circumstances.

I have previously commented on Trump's new book with Robert Kiyosaki here and here.

Based on the commercial that I saw, I am starting to wonder if the wealthy aren't thinking that this is the type of society that we should create: the "winners" living in opulent luxury, while the "losers" should be relegated to living on the street, or at least in tents.

In fact, if you consider all of the "reality" shows that are on TV, you could get the impression that there is a kind of zeitgeist or milieu of the return of Social Darwinism. It seems to me that the movers and shakers of our society are trying to convince the masses that they all can win -- if only they apply themselves. However, if you play and lose, well then, to hell with you.

I don't know, but something seems terribly amiss with a culture that exalts such norms.

Sunday, December 24, 2006

Merry Christmas!

And for your viewing pleasure, here is a video from TranSiberian Orchestra, who I saw in concert in Oklahoma City a week ago. If you ever get the chance to see them in person, don't miss it. It is a one of a kind show. Think of a Christmas rock opera that has everything: lasers, fireballs, lights and even a spaceship stage with two performers on it while it "takes off." Quite a spectacle to see!

The show was completely sold out. It took every seat in the Ford Center, which is just about Oklahoma City's largest venue. The mayor gave the Key to the City to the conductor.

Friday, December 22, 2006

An Old Short Story as an Allegory

I remember reading a short story back when I was in college many years ago about a woman who borrowed a necklace from a friend for a ball that she was to be attending later that evening. For all intents and purposes, the story goes, the necklace sparkled and appeared to be made of flawless diamonds. So, the friend lent the lady her necklace with the promise that it would be returned after the party. Somehow, when the lady got home, she noticed that she had lost the necklace.

Unwilling to admit to her friend that she had lost the necklace, she went to a jewelry store and bought a replacement necklace that looked just like the one she had borrowed. The necklace was very expensive. In fact, it was too expensive for her to buy with her meager savings. So she went and borrowed the money from several lenders, many of whom charged her usurious interest rates.

To pay for the money she had borrowed, she worked extra jobs, haggled on every purchase she made and had a hard time making friends due to her miserliness. She never married. She had grown wrinkly and gray quickly in life.

About twenty years later, she saw her old friend again. Her friend still looked young and beautiful, and had lived a life relatively free of worry. She told her friend about how she had lost the necklace, but had gone and replaced it with a new diamond necklace that was exactly like her friend's that she had lost. She told her how she had to borrow the money and had spent her life working the extra jobs and haggling to pay back the debts -- growing old before her time.

Her friend replied: "Why, you didn't have to do that! That necklace was just cheap costume jewelry."

It was a sad story. The woman had overpaid for the replacement of the necklace she had lost. She had borrowed excessively to pay for an object because she didn't understand its real value.

As I think about this story, I think about all of the people who overpaid for houses or who were steered into loans at interest rates that are far above what are warranted that will grow old before their time. They will have to work extra jobs, haggle on all their purchases and work to pay off debts that are more than they should have -- all because they didn't know that the house that they bought wasn't really worth what they thought they were.

Many times, the value that was placed on their home was based on many fraudulent appraisals. Some of it will be based on foolish speculation and mania. In the end, however, there will be a large segment of the population that will suffer the loss of enjoyment of life because they will be tied to the debt they incurred trying to buy a diamond house when the costume jewelry house will do just fine.

Don't feel less of yourself if you are wearing the cheap imitation jewelry to the party of life. When tomorrow comes, no one will really care whether you wore real diamonds or cheap imitations. The people who pay more attention to the ornaments you are wearing than the delight of your company, friendship and conversation have misplaced priorities anyway.

Thursday, December 21, 2006

Mistletoe and Wine

Besides Mark Heard, another artist that I have enjoyed listening to is Cliff Richard -- considered to be the "British Elvis." He is amazingly 66 years old now. I have never seen him with gray hair. I wonder how much hair coloring he has to use to keep looking so young. (8^p)

Anyway, in the spirit of the holiday season, I present to you his Christmas hit, Mistletoe and Wine:

They Were Dreaming of a White Christmas

But I don't think this is what they had in mind.


Alas, I didn't feel or hear anything.


A client of mine who lives near the epicenter described the earthquake like a boom with about 5 seconds of a rolling, waving motion. She described it like "someone rolling a 1 ton bowling ball."

Wednesday, December 20, 2006

Medical Malpractice Lawsuit Restrictions Ruled Unconstitutional

The Oklahoma Supreme Court yesterday ruled that limiting plaintiff's access to the courts in medical malpractice cases is unconstitutional.

From the article:

With eight of nine justices concurring, the court said the provision was a special law that unconstitutionally applies only to people filing medical negligence claims. People filing any other negligence claim don't have to comply with the provision, it said.

The law also creates an unconstitutional monetary barrier to access to courts because a person filing the malpractice lawsuit must spend between $500 and $5,000 for an expert opinion on the lawsuit's merit, the court said.

It also said the provision created a windfall for insurance companies that benefit from a decreased number of cases to defend but aren't required to implement post-tort reform rates that decrease medical malpractice insurance for physicians.

"These companies happily pay less out in tort-reform states while continuing to collect higher premiums from doctors and encouraging the public to blame the victim or attorney for bringing frivolous lawsuits,” the court's opinion stated.

The ruling grew out of a lawsuit filed in Okmulgee County by Monica Belinda Zeier against Zimmer Inc., and Dr. Theron S. Nichols over knee replacement surgery.

The trial judge dismissed the case because Zeier didn't have an affidavit from an expert that said the case had merit.

What will probably happen now is that the Oklahoma Legislature in its infinite wisdom will pass a new bill that says that all Plaintiffs in all lawsuits will have to obtain these expensive and pointless affidavits.

Hat Tip to Dustbury.

Real Estate Fraud Rising in the U.S.

From the article:

Real estate fraud has now firmly emerged on the FBI's radar as the country's fastest-growing white collar crime - all, in essence, polite forms of bank robbery. Industry losses ran to at least $606 million last year, it says. And the Treasury Department's suspicious-activity reports are up 35 percent this year. The Internal Revenue Service's criminal case numbers in mortgage fraud have been doubling every two years through the first half of this decade.

What is not stated is the rip-off of the American consumer as the inflated home appraisals push market values up beyond what is warranted -- and above what middle class Americans can afford. That does not even mention how many American consumers will be forced into bankruptcy because they, in their longing to buy a home, will have their dreams dashed on the rocks of the bankruptcy court because of exorbitant greed.

When homes are sold, the appraisal is based on camparable sales of other homes, or "comps" as they are known in the real estate industry. As inflated appraisals get factored into the market, other homes are expected to sell for similar prices.

Again, from the article:

In over 80 percent of the cases, scammers are helped by an insider, the FBI says. One of them was Jerome Mayne, a former loan officer who spent time in prison before becoming a motivational speaker in Eden Prairie, Minn. "The buyer they sent me was completely full of holes, fake everything, and I knew darn well that these guys were slippery enough to try to pull it off," says Mr. Mayne. A bottle of expensive booze and $500 cash helped grease the wheels, he admits.

Unraveling such gangs takes time and expertise, which has become the focus of law enforcement and industry professionals across the country. Working in their favor, at least, are solid paper trails.

"Usually when we complete an investigation, we end up with a spectrum of actors, from closing attorneys to brokers to appraisers, organizers, recruiters, and straw buyers," says Ms. Nelan. "It's fairly sophisticated, and it takes a lot of people to do it."

One of the toughest things for prosecutors is sorting out who's guilty. One group of recent perpetrators turned out to be clueless senior citizens in Alabama, who OK'd ploys to inflate their income in order to "invest" in real estate, says Linda Finley, a civil attorney who prosecutes such fraud cases in Atlanta. "It's gotten to the point where it's really hard to figure out who the actual victims are."

Another factor is the late-night TV ads and "motivational speakers" that touted how people became "overnight millionaires" buying and selling homes. I read somewhere that many of these motivational speakers were simply teaching people how to commit real estate fraud.

For more education on real estate fraud you can also go to the Flipping Frenzy website.

Christian vs. Christ Follower

Here are some videos that parody the Apple/Mac vs. PC commercials on TV. The videos contrast "bumper-sticker" Christianity with a more relaxed and "down to earth" concept of Christian living.

Part 1:

Part 2:

Part 3:

Part 4:

I am like the guy on the right.

Monday, December 18, 2006

Collection Abuses by Medical Creditors

The post is found at Credit Slips. Credit Slips is a blog that focuses on debt problems, bankruptcy and collection abuses.


The voiceover has not been added yet; but it will be soon. Stay tuned.

Top forms of Mortgage Lending Fraud


If you are buying or refinancing a house, watch out for the "Dirty Dozen" tricks by finance companies.

The link is a Word document.

No Worries...

From Calculated Risk:

Dr. Christine Chmura, president and chief economist at Chmura Economics & Analytics, says the economic pessimists aren't looking at the complete picture. She writes in the Richmond Times-Dispatch: Consumer debt high, but there's more to the story.
"...the Fed reports that household debt service payment (interest and principal) of homeowner mortgages relative to disposable personal income was 11.6 percent in the second quarter of 2007, the highest ratio on record since the data were first calculated in 1980.

Combining mortgage debt, consumer debt and other financial obligations -- auto leases, rental payments, homeowners insurance, property-tax payments gives the broadest view of debt for households.

Once again the Fed reports that this debt-service ratio for households is the highest on record: 14.4 percent of disposable personal income.

Couple this information about consumer debt with a significant slowdown in home-price acceleration, and pessimists point toward a soon-to-occur recession."
But Chmura says:
"[The pessimists] haven't looked at the complete picture.

A full balance sheet reflects assets as well as liabilities. As of the third quarter of 2006, household assets were at a record $67.058 trillion. Rising values in real estate and equities contributed to the increase.

More important, net worth hit a record $54.063 trillion during the same quarter.

So ... when the bills roll in over the next month, just remind yourself that the consumer engine that fueled an expansion still has the ability to support more spending and keep the economy robust."
Never mind that Chmura mixes flows with stocks, more importantly she could have written this piece in mid-1990 - just as the early '90s recession started.

Poster Tanta's response.

Thursday, December 14, 2006

Fahrvergnügen, Italian Style

Fahrvergnügen means "driving enjoyment" in German. I experienced true fahrvergnügen driving a Lamborghini Jalpa (pronounced "halpa") today. It was only for about two miles, and not very fast. But I figure I am part of an exclusive group of people who have ever driven a Lamborghini (maybe 10,000 people).

I am so vain. 8-)

My feet barely fit in the cramped, awkwardly shaped cockpit. Most cars' drivers' seat area is like a box. The Lambo's driver's area is shaped more like a trapezoid than a box. Your left left foot has little room to depress the clutch -- especially if you have big feet, like me. It is a good thing we took the top off; I would have had a hard time sitting in the car otherwise. Anyway, after a couple of turns (and subsequent accelerations), I started to get the hang of it. It was over quick.

At least I didn't wreck the car. Unfortunately for an owner of a brand new one recently, an escaping suspected shoplifter at the Sooner Mall ran into a brand new Lambo with the dealer tags still on it. Some people who saw the news story thought it was the car I drove. Nope. The owner told me that his was safely parked away in his garage when the incident happened.

The owner was much more adept of maximizing its performance than I. So much so that I was asking him to slow down. (I am such a chicken. I am probably not made out to own such hot performance cars; I am too risk averse.) He drove me down to Tecumseh and back. He then, on the way back, drove down a very hilly road (by Oklahoma standards). That made for a pretty exhilarating ride -- especially the way he drove. We came back by a school while it was getting out. The owner honked the special horn as we drove by. I think the kids got a kick out of it.

Ah, but a mere taste of the Good Life is about all us mere mortals can hope for. I got a taste today. Now I want more.

Now I just need to test drive a Ferrari. Even a low-end Ferrari, say a 308, will suit me just fine.

Wednesday, December 13, 2006

JibJab's 2006 Year In Review

This comedy video goes very fast. You may have to play it several times to understand all the words.

Monday, December 11, 2006

Exciting Hornets Game

A last-minute ticket became available from the Oklahoma Bar Association for tonight's Hornets basketball game. The Hornets played LaBron James (aka the Cleveland Cavaliers). Actually, that isn't fair. The Cavs had three very good players: besides, James, the Cav's center, a 7'3" giant who towered over pretty much anyone else on the court, was also a great shooter in his own right; and some guy with a big afro was very effective as a rebounder and shooter.

In the end, the Hornets prevailed for two critical reasons, from my vantage point: their notorious Third Quarter Drought™ did not materialize, and LaBron James went stone-cold in the fourth quarter.

It was an exciting game throughout. It was close right up to the very end. For most of the game, the Hornets were struggling just to stay even. It also seemed like the Cav's shots came easy, while the Hornets had to struggle for every basket. The Hornets pulled ahead in the last three minutes and managed to hold on until the clock ran out. The win is even more impressive if you consider that the Hornets are missing three of their best players due to injuries.

Chris Paul (aka CP3 -- his initials plus his jersey number) led the Hornets with 30 points and was named the game's MVP. The Hornets are now 10-8. When Peja Stojaković comes back from his injuries, the Hornets are going to be one formidable team.

On the Fritz

Apparently, just today, another Colorado pastor has resigned due to -- how to put this delicately -- a "personal failure" relating to his sexual orientation.

I remember many years ago when a big name TV preacher/singer broke down and cried proclaiming "I have sinned against you, Oh Lord." This prompted Christian rock singer Steve Taylor (who was attacked by the same crowd for using rock music) to write a song about the hypocrisy of people like this living two lives: one public one, wherein they had a veneer of righteousness; and another, private one, wherein they lived a life exactly against what they preached about the loudest.

Actually, when I read the Gospels, I see a Jesus who accepts human failure without condemnation. They woman at the well, the woman allegedly caught in adultery and many others. The issue of homosexuality was never dealt with in the gospels. However, based on the treatment of other sexual issues that I listed above, I get the distinct impression that the corrupting influence of human sexual needs was not a major issue for Jesus. Why it has become such a major issue for modern evangelicals can be puzzling to outsiders. I grew up in that culture, but it has been so many years since I was part of that mindset that it doesn't make sense anymore.

So, for your viewership, Steve Taylor's On the Fritz:

You can find the lyrics here.

Manic Monday on India's Stock Exchange

The Bombay Stock Exchange (known there as a "bourse") dropped 2.9% today.

From the article linked above:

The 30-share Sensitive Index had tumbled by 537.76 points, the biggest intra-day fall since September 11, but gained partially toward the end but closed 2.9 per cent lower at 13,399.43.

Now the question is: will India's stock market have any effect on American markets? From what I was able to gather from the article, much of the decline was fueled by a large drop in banking stocks.

Stock brokers said RBI's decision to hike CRR of banks by 50 basis points to tighten liquidity and contain inflation, triggered the fresh round of selling, particularly in banking sector stocks by foreign funds and retail investors.

I think "RBI" stands for the Royal Bank of India and CRR stands for Cash Reserve Ratio. Although the acronyms are not defined in the article.

Friday, December 08, 2006

Elizabeth Warren on the Bankruptcy Hearings

And Bob Lawless of Credit Slips has his report here.

And here is the CNBC interview of the opposing sides.

The really short report is: the Republicans did a final-day hearing where they had lots of witnesses say what a great law this was.

Wednesday, December 06, 2006

NACBA Press Release on Bankruptcy Hearings

Senate Bankruptcy “Hearing” Is Last-Ditch Effort By Credit Card Industry To
“Slap Some Lipstick On The Pig” Of Failed Law Changes

Republican witnesses either blindly support failed bankruptcy law changes or are industry shills; Senate hearing is typical of industry-dominated process that led to anti-consumer law.

See the rest of the press release at the link above. It is a Word document.

Elizabeth Warren on the Housing Crisis

On top of the link above, check out the article referenced in the New York Times(subscription required).

Tuesday, December 05, 2006

Text from a Birthday Card I received...

Your birthday reminds me of that great Oriental philosopher.

Yung No Mo.

Happy Birthday.

Gee, thanks for reminding me.

Monday, December 04, 2006

Stop Buying Stuff

Saturday Night Live spoof skit of financial management.

Sunday, December 03, 2006

The Shape of Wealth

I decided to go shopping yesterday, and then watch of the OU-Nebraska Big 12 Championship football game. (For those of you who visit this site from out of the country, that is American football, which is similar to rugby -- not soccer.)

Anyway, I did a little more reading of the Why We Want You to Make Us Richer, er, I mean, Why We Want You to be Rich by Donald Trump and Robert Kiyosaki. In it, on page 46, Mr. Kiyosaki refers to a Changing Demographic of the American populace. He claims the American populace is changing from a rhombus-shaped society (I was planning to upload some images to assist me, but Blogger is not working right for some reason) to an hourglass-shaped society where there are many rich and many poor, but few middle class.

***Update*** Blogger seems to be working again.

I think he has the wrong shape. We are turning more into a triangle-shaped society. There are still relatively few rich, but there are more poor and fewer middle class. Many of the middle class are sinking into the lower classes. But the number of middle class Americans that are rising to the upper classes -- even upper middle classes -- is not increasing at same rate as those falling into the lower classes. In fact, you would be hard-pressed to show that the percentage of middle class Americans that are moving up is increasing at all.

Mr Kiyosaki goes on to say on pages 47-48:

The problem is our nation is filled with people like my poor dad -- a good man, well-educated, hard-working, yet expecting the government to take care of him when he retired.

He then says that all the money that the baby boomers contributed to Social Security has "disappeared into a Ponzi scheme."

What a canard.

I, for one, cannot figure out what is so wrong with creating guarantees for workers who have worked all their lives so that they can live out their last days in relative financial security. Not everyone can become a CEO, top athlete, movie star, a Senator or a big-business owner. Many people are quite content to be your Average Joe; and there is nothing wrong with that. The fact is that very few people are cut out by genetics or training for greatness.

Mr. Kiyosaki is starting to come off in this book as a snooty and pretentious elitist. The fact is that one of the best and most stable retirement guarantees is Social Security. It is not like the President of the United States and his administration can filch the Social Security funds like Enron or Worldcom executives did with their employees retirement funds.

Before you throw eggs at me, I realize you could argue that Congress is spending the Social Security money irresponsibly to lessen the current account deficit. But that is not quite the same as dumping the very stock in a company that you own while at the same time telling your employees to buy the stock with their retirement money. It is this very type of graft that discredits Mr. Kiyosaki's argument to make everyone responsible for their own retirement. What we need, if we are to keep retirement plans private and encourage people to invest their money, is to have laws that strengthen the ability to recover money that is misappropriated.

Thursday, November 30, 2006

And the Follow-Up humor from


Stupidity; and


The Entitlement Mentality?

In the book Why We Want You to be Rich, Robert Kiyosaki follows up Donald Trump's statement
"I'm afraid we have developed an entitlement mentality as a nation. And I'm not talking about just poor people. Too many people, from the president and senators on down, expect a pension from the government. I really wish we could afford to solve their problems, but to do that would bankrupt our nation. We could ask the rich to pay for everyone, but would it solve the problem? And for how long would it even solve the problem?"
with the statement:
"I agreed. Donald and I want people to let go of the entitlement mentality and become rich so they can solve the problem ... their own problem."

"The best way to solve the problem of bad financial results is to change our thoughts -- to start thinking like rich people rather than poor and middle-class people. That means losing the entitlement mentality -- whether you are a military officer, government worker, schoolteacher, employee or just poor. If we do not stop expecting the government to take care of us, we will continue to have the same results -- a bankrupt nation filled with well-educated but financially needy people.

"Albert Einstein defined insanity as 'doing the same thing over and over again and expecting different results.' In this case, it is my opinion that it is insanity to keep sending kids to school and not teaching them about money."

From pages 40-41.
OK, first of all, many of the reasons why people like myself are clamoring for guaranteed pensions and healthcare is because many corporations have mismanaged worker's contractually promised benefits like pensions and healthcare to the point that their actions should be considered criminal.

The book started out so well. It seemed like they understood the problem. Instead of proposing solutions that would end the erosion of the middle class, they go off on this Socially Darwinistic tirade that everyone should just fend for themselves. They want to shift the burden from themselves (and any taxes that they would have to pay) onto the very people who now cannot bear the burden because their wealth (via pensions and healthcare guarantees) have been stolen from them (by their corporate employers not funding those very guarantees). In a sense, the corporate owners have embezzled those funds.

I understand the distinction: there was no legal obligation (other than a weak contractual one that can be eradicated in Chapter 11 bankruptcy) to fund these obligations for the benefit of the workers. But if a worker had taken the employer's money and used it for a purpose other than what the employer had designated it, he would be guilty of embezzlement.


The local weathermen are saying that the snow/ice storm that is rolling through Oklahoma right now is the largest one in over a decade. They are telling us not to go out unless it is an absolute emergency. I will be heeding their advice and sitting down and reading Donald Trump and Robert Kiyosaki's new book Why We Want You to be Rich.

Initially, I was a little surprised in that they acknowledge the shrinking middle class. When I bought the book at Sam's Club, I initially thought: "oh great, another 'happy talk' motivational book." So far, in the first 20 or so pages that I have gotten through, I only have a few minor critiques that hope to blog about later today.

Tuesday, November 28, 2006

Some Folks' World

by Mark Heard.

Some folks' world is war-torn
Some folks' world is fine
This planet makes no sense to the untrained mind

Some folks hope for fortune
Some folks hope to die
Each man sees his fate through his own two eyes

And when it's day to me it's night to someone
And when it's night you might not want to go on

Some folks eat what flies leave
They get what they can take
Hunger has no heart and it will not wait

Rain can ruin your weekend
Or rain can spare your life
Depending on who you are and what your thirst is like

And when it's day to me it's night to someone
And when it's night you might not want to go on

All folks' days are numbered
But most folks do not care
And no man calls his coin when it's in the air

Some folks taste of Heaven
Some folks taste of Hell
Some folks lose their taste and they cannot tell

And when it's day to me it's night to someone
And when it's night you might not want to go on

From Victims of the Age
Thanks to the Mark Heard Lyric Project

I thought about this song of Mark Heard's today as I watched the news about the developing civil war in Iraq. You could apply this to people and situations all over the world, not just Iraq. There is Darfur, Israel, Lebanon, southern Asia after the tsunamis, New Orleans after the hurricane and any number of other tragedies we hear about regularly. As we enter and celebrate the Christmas/Hanukkah season, remember those folks whose world isn't so good and pray for them.

Monday, November 27, 2006

Advice to young Chiropractor: Just Make More Money

Unbelievable. Do these financial advisors really believe that money grows on trees?

From the article:

•Earn more money.

Schopp simply has too much debt, Cook says, for how much money she makes. She works full time as a chiropractor and part time as a personal trainer at a local gym, earning about $44,000.

"Her ability to generate more income from her W-2 job (as a chiropractor) probably isn't here," he says. But she could add personal-training clients. Schopp agrees that's a good idea.

But Cook warns that to cut expenses and increase her income, Schopp must stay focused for several years to dig herself out of her debt.

"Heather needs to be a 'no' person," Cook says. " 'Want to go out to dinner?' 'No.' 'Want to go shopping?' 'No.' She needs to have two things burned into her brain every day: watch my spending, and get a new customer. Don't spend. Get a customer. Don't spend. Get a customer."

Now get this: this is in response to a woman who works two jobs to pay her basic living expenses. TWO JOBS! Why is she in such financial trouble?

Chiropractor works 2 jobs to chip away at $165,000 in school debt.

Yea, that's living extravagantly. NOT. (Remember, this is southern California -- where living expenses are much higher.)

Has anyone ever thought about the fact that we are creating too many Barriers to Entry for the middle and lower classes to achieve financial success in life? Isn't the whole American ethos supposed to be "work hard and you will succeed?" I almost get the feeling that the amount of student loan debt that is required to get through college is becoming a kind of debt peonage system whereby here in America, the land of the free, we are devolving back to the days of slavery, but simply in a new form. We seem to be raising the cost of a degree so high that middle and lower class people cannot afford to take the risk. Ultimately, this will lead to a society that will be less competitive.

Also, has anyone thought about the policy of not allowing student loan debts to be dischargeable in bankruptcy? This also adds to the argument that student loans are becoming America's debt bondage. People are stuck owing a debt they can never hope to pay back, and yet unable to earn enough money, without some great deal of luck, to get past it.

Is this really the America that we want?

Friday, November 24, 2006

An Exercise in Poverty

Hat Tip to one of my regulars, Teri Pittman, for the link.

From the article:

Recently, I attended a local conference regarding Financial Literacy in Oklahoma . As part of the conference they had a “poverty simulation.” The purpose was to give us some idea of what it would be like to live in poverty. I can’t say that I know what it really feels like to live in poverty because I got to end the simulation whenever I wanted. But, I can say that I learned a lot during the experience.

We were assigned an identity and given a summary of our current life situation. Stations were set up to represent the utility company, the mortgage company, a pawn shop, check cashing loan store, grocery store, and public assistance. During the simulation, I became a 19 year old, unemployed, high school drop out, single mother with a live-in boyfriend. Our bills totaled $555 per month including a mortgage on our mobile home, lot rent, utilities, food, and a car title loan that we had taken out. We also had to give transportation passes at every stop to account for the gas or the bus to get us there. Our monthly take home pay was $794.00 per month including $234 in TANF (Temporary Assistance for Needy Families) benefits and $120 in food stamps. That left us with $239 per month for everything else. Trust me $60 per week for a family of three for everything else (such as gasoline for the car, medicine, car repairs, diapers, toiletries, and other items) does not go far. Just to make it interesting we were also given several items of value to pawn if we got desperate.

Before the simulations started, I told my partner (a.k.a. my live-in boyfriend) that I knew exactly what we were going to do. We would pay our bills by priority in order of importance (housing, food, car, utilities and then the car title loan). In my real life as a credit counselor, that’s exactly what we teach people to do. I also informed him that we would not go to the pawn shop at all. I knew that I was going to fly through this exercise with no problems. I am a money management expert, right?

It was amazing to me how quickly my priorities changed. In a matter of minutes I transformed from the calm budgeting expert who had it all figured out to someone who was just living in survival mode. Much of my reason and logic went out the window. I could not pay the mortgage first as planned because we only took home $110 per week from my boyfriend’s job. It was 3 weeks before we had enough to pay the mortgage. In real life, I tell people to pay their mortgage first since we want them to avoid homelessness. In the simulation, we paid the mortgage next to last and had been evicted by the time we came up with enough money to pay it.

In real life I advise people to avoid paying high fees for services such as check cashing and to stay away from the pawn shop. Logic would tell you that it is much cheaper to open a checking account at the local bank or credit union than to pay fees for check cashing services. In the simulation, we did not have a bank account and could not obtain one. In order to cash my boyfriend’s check to get money to pay the bills, we had to pay a $10.00 fee for every check we cashed. When we got a cut off notice for the utilities, I found myself in line at the pawn shop to hock my stereo. I took the money from hocking the stereo to pay the gas bill just before they cut it off. I also had to stand in a long line at the public assistance office just to confirm my TANF benefits. I had to take my baby with me since I could not afford daycare. I stood in line for so long that the office closed and I had to come back the next day. I witnessed another single mom making her sick child stand in line with her because she had no other choice. She could not afford daycare and the child could not go to school when she was sick.

It was so amazing to me how quickly I changed my priorities during this exercise. In reality, it is pretty easy to sit behind a desk and tell people what they “should” do with their money. When you have extra money, it’s easy to talk about all of the responsible things you should do with it. I guess it’s the financial equivalent of armchair quarterbacking. In my job, I recommend the logical, money saving way to live. However, when I found myself in the situation of not having enough money to take care of my family and keep from getting evicted, I just did what I could to survive. If a station forgot to ask for my transportation pass (we were required to give them at every station) I didn’t offer it. I just kept it and hoped to get through the transaction without having to give it up. When the gas bill was due and payday was days away, the pawn shop looked like a pretty good option. When the problem of no checking account stood between me and getting money, I did not care that I had to pay the $10 fee for every check. I just needed the money.

Read the rest of the story at the title link. It should make you think twice about our public policy of purely letting "the free hand of the market" set wages.

Black Friday shopping

Well, I just came back home after the morning shopping experience. From my vantage point, it was a lot lighter than I expected. There was no more traffic at Memorial & Penn than a normal weekend and the mall and Wal-Mart/Sam's Club did not look much busier than a normal weekend, either. I would say that the traffic was a little elevated, but there were certainly no traffic jams.

Besides Quail Springs Mall and the Wal-Mart Supercenter/Sam's Club, other shops in the area include Ultimate Electronics, Super-Target, Circuit City, Barnes & Noble, Toys R Us, Office Depot, Old Navy and a few others. None of them seemed packed. But maybe that is just me. My experience is just anecdotal, but it didn't seemed to me that sales were all that brisk. What makes me think that sales were down is that the Quail Springs Mall area is also the middle-to-upper class part of Oklahoma City, so if sales aren't up in that part of town, it probably isn't up anywhere else.

I am curious what everyone else's experience is like. There is a lot of talk that there will be more online shopping this year, and I will probably be doing some of that myself. I'll be watching the numbers on Monday to see if my experience bears out everywhere else.


Well, I just came from the south side of town. Best Buy and Crossroads mall were about 50% busier than normal. So maybe I was just in the wrong part of town. It still isn't quite as I remember from Christmas' past, but not too bad.

Tuesday, November 21, 2006

And in the You've Got to be Kidding Me Department...

I have previously written how I believe that the creation of a national health care is consistent with the Christian faith, so for a mainstream Christian sect to come out against health care for everyone is troubling, to say the least.

Health care, at its most basic levels, has two justifications:

1) it is a charitable dispensation of kindness to someone at their when they are their weakest and in the most need; and

2) it is designed to increase the efficiency of a soldier or worker so that, once healed, can produce or fight another day.

For these reasons, the guarantee of access to health care has both a faith-based and secular efficiency-based justification. Certainly there are issues of how many societal resources can expend in treating illness and injuries; but the central and fundamental basis for the creation of a national health care system should not subject to argument. And what is truly shocking to me is that those who would proclaim their Christian faith the loudest would be the most obstinate in supporting health care for all.

New M3 Money Supply Reported by Big Picture Blog

The M3 money supply is a broad measure of money and is an estimate of the entire supply of money within an economy. The thing is, the government stopped reporting the M3 money supply numbers back in March, 2006. It is generally felt that if the government stops reporting information then that is something to watch out for.

What we have now found is that the M3 money supply has been inflated during the time that the government did not report the data. This, I think, leads to inflation concerns. If I am reading the reports correctly, that means that real inflation is running at about 10%, which is much higher than the official CPI numbers of 3%. However, I am going to defer to people who are much knowledgeable about this than I.

Monday, November 20, 2006

Report in USA Today shows Oklahoma home prices still going up

Oklahoma is reportedly one of the few places in the country where home prices are still going up. Home prices rose in Oklahoma City by 5% in the last year and Tulsa rose by more than 9%.

Bubble? What bubble?

College Graduates are Struggling with Debt

From the USA Today article:

Nearly half of twentysomethings have stopped paying a debt, forcing lenders to "charge off" the debt and sell it to a collection agency, or had cars repossessed or sought bankruptcy protection.

High debt loads are causing anxiety, too. A poll of twentysomethings by USA TODAY and the National Endowment for Financial Education (NEFE) found 60% feel they're facing tougher financial pressures than young people did in previous generations. And 30% say they worry frequently about their debt.

"I have nightmares," says Heather Schopp, 29, of Long Beach, Calif., who accrued $165,000 in student-loan debt to become a chiropractor. "I dream I'm on a hot-air balloon, hanging on for dear life."

Among all twentysomethings, the fastest-growing group owes $20,000 or more in student-loan debt. Though it's a small group, its proportion has doubled in the past five years to 3%.

"This debt-for-diploma system is strangling our young people right when they're starting out in life," says Tamara Draut, author of Strapped: Why America's 20- and 30- Somethings Can't Get Ahead. "It's creating a sense of futility that no matter what they do, they're not going to be able to get ahead. It's a sense of hopelessness."

A change of plans

Debt has forced some young people to change their career plans. Of those surveyed, 22% say they've taken a job they otherwise wouldn't have because they needed more money to pay off student-loan debt. Twenty-nine percent say they've put off or chosen not to pursue more education because they have so much debt already. And 26% have put off buying a home for the same reason.

A smaller percentage say they've put off marrying (11%) or having children (14%).

The Boomerang Generation — young adults who return to live with their parents — is real, too. In the poll, of 910 twentysomethings, 19% said they've moved back with parents to cut costs. The 2000 Census found that more than 25% of 18 to 34-year-olds had moved back in with family at the time the Census was taken.

Yep, this is what you call the "ownership society." American college graduates are owned by their education debt.

What are the reasons for this problem? Again, from the article:

What exactly is tougher about the financial challenges facing today's young adults? Shireman of the Project on Student Debt points to:

Skyrocketing tuition. The average price of college has grown much faster than the rate of inflation. Average annual tuition at public four-year colleges and universities is $5,836 in 2006-07, up 268% from 1976-77, according to the U.S. Education Department and the National Center for Education Statistics. Private college tuition is up 248% to $22,218 a year.

Declining student grants. Though total federal student aid has grown sharply, so has the proportion of people in college. In 2004, 67% of high school graduates enrolled in college; in 1972, only 49% did. As a result, student grants cover only 39% of the costs of a four-year college today, compared with nearly 80% in the mid-1970s, the College Board says.

Soaring student-loan debt. Students have generally made up the gap between what colleges charge and what they can afford by borrowing. The percentage of students who borrowed for college jumped to 65% in 2000-01 from 34% in 1977, the National Center for Education Statistics says.

And they use credit cards to help pay for books and other items. Half of all graduates in 2004 used credit cards for school expenses, the American Council on Education found.

Flat wages. Once students graduate, jobs don't pay what they used to.

Thirty years ago, a male college graduate could make the equivalent of $51,223 a year in 2004 inflation-adjusted dollars. In 2004, he earned less: $50,700, according to the NCES. Wages for women, though, have risen.

Rising home prices. It takes a greater portion of the average income to buy a median-price home today. In 1970, it was 17%; in 2005, 22.4%. The median price of a home was $23,000 in 1970. Adjusted for inflation, that's $115,770 — barely more than half the median price of $219,000 in 2005.

"Twentysomethings now are crunched in ways older people were not," says Cathy Stocker, co-author of The Quarterlifer's Companion, a book for twentysomethings. "The cost of education has far outpaced income, and housing costs have skyrocketed. They're crunched from all directions."

For more information on how this all fits into the Big Picture, see my previous posts here and the Warren Reports generally. Just click on the Warren Reports tab for more articles. on what we can expect from a Democratic Congress

The article mostly talks about housing-related policies. But it suggests that the Democrats will be holding hearings and proposing legislation to curb predatory lending, creating a national standard for many types of loans and proposing a tax credit for Private Mortgage Insurance (PMI).

Friday, November 17, 2006

The Drift Towards a Class System by Jim Webb

Click the link above for the article (or a part of one) has been reposted by a blogger over at ProgressiveU. The article originally appeared in the Wall Street Journal (subscription required) by Jim Webb, the new Senator-elect from Virginia.

Thursday, November 16, 2006

Too Many Voices

This is a follow-up to my post two days ago reviewing the Blue Man Group concert in Oklahoma City where I mentioned the information overload alluded to in the concert. I was thinking of how much time I spend every day reviewing all the different blogs and news sites for information and how there is more information than I have time to digest, it seems. Sometimes it seems that there are just too many voices.

Of course, I just had to add to the chatter of too many armchair pundits adding their two cents worth on the issues of the day. So I have a lot of room to talk, don't I?

Of course, the founding fathers of the United States always intended for there to be a clash of the cacophony of ideas among the participants in the political process. At the same time, the virtual smorgasbord of sources of information is almost too much to handle.

Although I suppose its better than the alternative. I would rather have access to all the information out there that allows me to make an intelligent decisions about politics, investments or any other interest I have. So maybe there aren't too many voices after all.

Is Whitney Houston Heading for Bankruptcy?

I guess it's not just the poor and middle classes that have problems with money management....

Wednesday, November 15, 2006

An interesting legal argument against credit card contracts

See the responsive comments by Kevin LoVecchio (klovecchio) in response to commenter Gnopple. He makes some good legal points regarding credit card contracts not being valid contracts under traditional contract law.

From the comment:
Moreover, if you read my prior post on this subject that (linked to above) you'll notice an even bigger problem: the changed contractual terms typically
apply retroactively to balances you already carry. Your comment references this point and suggests that it should be against the law, but it currently is considered acceptable practice. In other words, if you have a $5,000 balance and the credit card changes your terms to say that your 0% promo rate is bumped to 29%, your late fees increased twofold, and your minimum monthly payments doubled, these changed terms apply to the balance you already carry. Using our imagination again, pretend you went to the store and purchased a CD for $10. How would you respond if the store called you a week later and demanded an extra $5 for the CD long after it was purchased? Applied to credit cards, imagine you want to purchase a $3,000 flat panel television but don't have that much cash on hand. You calculate that you can afford an additional $250/mo., so you sign up for a credit card with a 0% promotional APR for one year and purchase the television with the expectation of making those payments for twelve months until the balance is paid down. One month in, your credit card company terminates your promo rate and hikes your standard APR to 20%. Suddenly, your purchase price for the $3,000 television just jumped to $3,600 (ignoring compounding penalties and fees), long after you made your purchase.

One final point. I would argue that this isn't a contract at all. If every single term of the contract is subject to be altered or removed at any time, upon the unilateral action of one party, then what terms did I agree to? The law has a name for this, and it's an "illusory" contract. An illusory contract appears to be a contract but in fact is not legally enforceable because it lacks at least one essential aspect of a contract; in this case, it's lacking all aspects of a contract because there isn't a single term written in stone that can't be changed at the whim of the party. In the simplest sense, this is no different than a "contract" that
states only "I'll give you $10 if I feel like it," which is no contract at all.

The Ugly Truth about Health Care

Here is a more condensed version of the story than the link above:

Delbert Davis lost his job, and with it, his health insurance. During the three months he was unemployed, he was diagnosed with cirrhosis of the liver. With no health insurance, he was denied the ability to be placed on an organ transplant list.

James Kvaal over at Warren Reports at Talking Points Memo comments:

Davis fell right through our safety net. Medicare wouldn't cover him for two years, and he didn't have two years. He wasn't poor enough for the county health program. He couldn't afford the premium for the state program, and anyway it would make him wait a year for the surgery.

With a little more time, he might have been helped by a special Medicaid program (which would have required him to get divorced, by the way).
(Editorial comment: Talk about "family values!")

But he didn't have time. Davis died on October 20.

His widow, Ann Davis, is left with $1,875 a month in medical bills and is afraid she will lose her house. She told the Austin paper, "My husband and I have worked hard all of our lives. We had insurance up to a very brief window of time: three months that we didn't have coverage, and this happened. Just that little lapse of time . . . and we were trapped in a spiral that we couldn't get out of."

Hard to believe that losing a job can be a death sentence, but that's how messed up our health care system is.
Now I realize that having a national health care system would not completely solve this problem, but it would help. Another problem is the lack of available organs for transplants. (If you haven't checked the Organ Donor on your driver's license, now would be a good time to do it.)

In any case, stories like this where people lose everything they have due to medical bills is just insane. This is just another anecdotal example of why we need a national health care system.

Tuesday, November 14, 2006

Blue Man Group Concert Review

The Blue Man Group came to the Ford Center in Oklahoma City Sunday night. It was a great show, as always. I have now seen them live three times: once in Las Vegas, once in Chicago and now once in Oklahoma City. The show, entitled "How to Become a Megastar 2.0" was about 75% of the same show as you will find on their Complex Rock Tour Live DVD.

As I watched the show, there was a segment about the enormous amount of information that we have access to now. During this part of the show, there was a screen that scrolled three lines of text. It goes across so fast that you would be lucky to read just one of the lines. I decided to pick the top line and just read it. It talked about how just one page of a modern newspaper contained as much information as what an entire paper from the 1700's would have. It also gave some statistics on how much information is contained on the internet every day compared to previous years.

It made me wonder: with all this information that we are bombared with, are we suffering from "information overload?" There are many days that I feel that there is too much information. What I mean by that is that I don't have enough time to keep up with it all.

Anyway, there is also a segment where they spoof U2's Bono and The Edge and their pushing certain causes. Anyway, the segment did a serious take on global warming (with some humor thrown in).

If you get a chance to see the show, it is one of the better ones.

Sunday, November 12, 2006

Saturday, November 11, 2006

Experts Think Bankruptcies About to Rise

The link above links to an article wherein bankruptcies are expected to rise in the next year.

Hundredaires in the Making...

Wealth creation, American style.

Is this the cause of rising real estate prices?

I have a suspicion that we will be hearing a lot more stories like this as the real estate bubble deflates. From the story:

A federal indictment unsealed Thursday accuses home buyers, real estate sales people and a mortgage broker — seven people in all — of wire fraud, money laundering and other offenses in attempts to defraud lenders in buying homes in Edmond's upscale Oak Tree addition.

The seven committed fraud by "artificially inflating the sales prices of homes and submitting false loan applications," the indictment alleges. "Each of the defendants intended to personally profit by funneling substantial sums of money back to themselves and others from the excess sales proceeds under the guise of remodeling, repair costs or marketing service fees."

Friday, November 10, 2006

Is Asset Dependence our problem?

Michael Larson posted a link to this article in a comment at Calculated Risk.

Another Good Post from the Warren Reports

Here is a post that tangentally ties into what I posted today regarding family finances.

Lonely One

As a follow up to my previous post, I thought I would tie it in to a couple of the songs by Mark Heard. Compare the development of his earlier song "Lonely One" to his later work which expressed the angst of an older generation (expressed through the eyes of a single woman) in the song "She's Not Afraid." The earlier song has an obvious reference to the "woman at the well" story in the gospels. The later song is much more contemporary in its expression of the feelings of many Americans today.

by Mark Heard
Lonely one
Hard times inside you
I have seen you crying
Lonely one
Dry eyes can't hide you
When the truth draws nigh

Lonely one
you're such an actress
Smiling with your makeup
Lonely one
you're out of practice
And smiles are hard to fake

You're not in love, not even with your lovers
You've thrown your heart to the wind
Oh lonely one, when will you ever bother
To reach for the hand of a friend

Lonely one
Run from the shadows
Darkness lies in waiting
Lonely one
You know it matters
That you find your way
Oh lonely one

Lonely one
No one to talk to
Cords of silence bind you
Lonely one
Gentle whispers call you
Seek and you will find
Oh lonely one
Oh lonely one

From Stop the Dominoes Thanks to the Mark Heard Lyric Project

A beautiful song, to be sure (the lamenting melody with the fiddles adds to the effect); but compare his more developed song with the lonliness theme later:

by Mark Heard.

She was trapped in a photograph
When times were better
Saying cheese with a frozen laugh
When times were better
How she wishes she could thaw that scene
Make it real and not just some camera's dream
And bring back the places
And the feeling and the faces
From the graves where they've been

She's not afraid of sticks and stones
She's not afraid of thunderstorms
She's not afraid of smart bombs blowing
The world in little pieces
But she's afraid of a life alone
She is afraid of an empty home
She is afraid that her faith has flown
Afraid of losing memories

She was the captain of her maiden flights
When times were better
Skywriting with the smoke of life
When times were better
And now she wishes she could beat her wings
And sail back on a innocent breeze
Bring back the freedom of believing
In the decency of anything


How she wishes she could strangle time
Put it in a prison for stealing her blind
Bring back her riches
From the rubble of her wishes
Where she's let them lie


All the Lonely People

It has been well-documented that we are marrying later here in America, and it is affecting our politics. USA Today's story listed above suggested that it might affect our electoral politics in this, and future, elections.

What struck me in the article is how all of the districts with the highest percentage of married people went to Republicans and how all of the lowest percentages went to Democrats and how many of the battleground districts were ones where the number of married and unmarried districts approached 50%.

When I first began the thought of writing this post, I wanted to simply point out how we are marrying later. It is a trend that is developing, and I am curious as to its causes. From an article in the Christian Science Monitor:

As the US moves toward 400 million people, Americans can be expected to marry later in life, and more of them will live alone. Between 1970 and 2005, the median age of first marriage moved from 23 to 27 for men and from 21 to 26 for women. Over the same period, the percentage of single-person households grew from 17 percent to 26 percent. Those trends are likely to continue.

Another trend that is likely to continue: marriages that are "'Til Debt Do Us Part" as this article in USA Today indicates. From the article:

Money conspires to antagonize couples. It sometimes invites divorce. And though finances have always raised tensions for couples, it may be harder than ever these days to avoid conflict.

That's because today's range of family complications — moms leaving and re-entering the workforce, late marriages that bring debt and adult children, shrinking pensions and baffling health care choices — are demanding ever-more financial decisions from couples who can't even agree on whether the house is warm or cold.


There's a big problem, though: The USA is a nation of spenders, not savers. The personal savings rate is negative, meaning Americans spend more than they earn. And the portion of disposable income going toward paying down debt — including mortgage and credit card debt — is near a record high. Households with at least one credit card carried an average of $9,498 in card debt in 2005, nearly twice the level of a decade ago, according to

I still remember lawyers who talk about "how we used to fight over assets, and now all we fight about is debts." It not quite true, but it is not far off, either.

What the Republicans don't understand is this: those financial policies of maximizing profits at the expense of the working class is tearing into the very moral fabric of the married couples that make up their districts. Can the Democrats take advantage of the void left behind?

Thursday, November 09, 2006

Editing My Blog

I have figured out how to add some advertisements from However, what I want to be able to do is add a third column (that way I can separate the ads from other content-based information). If you know how to do this, please let me know.

Wednesday, November 08, 2006

Here is another BlogThings test

Here is another test that I took:

You Are Incredibly Logical

Move over Spock - you're the new master of logic
You think rationally, clearly, and quickly.
A seasoned problem solver, your mind is like a computer!

What kind of Blogger are you?

I took this test over at BlogThings and this is how I came out:

You Are a Pundit Blogger!

Your blog is smart, insightful, and always a quality read.
Truly appreciated by many, surpassed by only a few

Hornets Leading Their Division

From the article:


The Hornets improved to 4-0 for the first time in franchise history with a 97-93 victory over Golden State. The Hornets followed their home-opening victory in New Orleans by winning their opener in Oklahoma City to join 4-0 Utah as the NBA's lone unbeatens.

They refuse to get ahead of themselves, either.

"We're still trying to build an identity," Chris Paul said. "It's only four games into a new season. It's still possible for us to finish 4-78. You never know."


Paul had 22 points and 11 assists while running the Hornets' balanced attack. Peja Stojakovic scored 18 points, David West had 16 points and 11 rebounds, and Desmond Mason added 12 points. Tyson Chandler had 10 points and 14 rebounds.

"You can't key on one guy with our team," Paul said. "Some teams have a guy that down the stretch they're going to go to that guy every time. With our team it varies."

The Hornets stayed in the Western Conference playoff race deep into last season, and were expected to contend for a spot this time after acquiring Stojakovic and Chandler over the summer.

"I think every player on the team is getting more confident when we step on the floor that we can get the job done," Mason said. "Even in tight situations we're getting it done. Last year we didn't do that. Last year we kind of fell flat a little bit in those situations down the stretch. We couldn't make plays."


Yep, now that the Hornets are in Oklahoma City, they are doing much better.

Oklahoma Election Night Watch Party 2006

I am a political junkie and so I went to the Democratic Party's watch party last night in downtown Oklahoma City. The mood was hopeful and festive and grew as the night went on. The Democratic wave from last night had a small impact in Oklahoma. Oklahoma Democrats gained seats in the Oklahoma House of Representatives and all but one of the statewide offices (gaining the Lieutenant Governor and Commissioner of Labor positions).

The Republicans ended up tying in the Senate (24-24), but because the Democrat, Jari Askins, won the Lieutenant Governor's position, she will cast the tie-breaking vote. The Lieutenant Governor's office was vacated by Republican Mary Fallin, who won Oklahoma's U.S. House District 5, replacing Republican Earnest Istook, who was crushed by popular Democratic Governor Brad Henry in his reelection bid.

I personally was more interested in the national races than the state or local ones. I had to hijack one of the three TVs in Dr. Hunter's room so I could keep up with the national races. All of the other TVs were tuned to the local races. If the current numbers hold up, it appears that the Democrats will control the U.S. House and Senate.

I went from room to room for all the candidates to see how all of them were doing. Of all the Democrats there, only one lost (Cody Graves, who was challenging for Oklahoma's Corporation Commission against Bob Anthony, who won a lot of public support in the early days by wearing a wire for the police when a lobbyist tried to bribe him -- but even he came surprisingly close).

It really got festive at about 11pm when the final precincts came in for the District Attorney's race for Oklahoma County. With 30 precincts left, word came that the Democrat, David Prater, was 2000 votes short against the Republican incumbent Wes Lane. However, the precincts that were still out were from eastern Oklahoma County in predominantly Democratic areas. With 3 precincts to go, David Prater pulled ahead by 300 votes. Prater, eventually emerged on top by 824 votes out of almost 175,000 cast. The room (and hallway, and foyer down the hall) erupted in celebration. The funny thing is that Prater had the smallest room of all the candidates, but it seemed like he had the most people watching the results. You couldn't hardly get in or out the room by the end (it wasn't easy even before that). After the announcement of the final results, we heard that the incumbent would be asking for a recount.

Oklahoma uses the electronic voting machines that scan paper ballots. The ballots are easy to read and can be hand-counted if necessary. So, the final result will have a high degree of certainty. So, unlike the concerns about the Diebold machines in other states, Oklahoma's elections won't have doubts about the outcome(s) if a recount is necessary.

Overall, it was a good night for the Democrats -- even in Oklahoma.

If you are interested in more results from the Oklahoma election, you can find them at the Oklahoma Election Board site.

Monday, November 06, 2006

Progressive Christians Uniting's take on the Ted Haggard scandal

Another thought-provoking post about the Ted Haggard scandal from a Christian perspective you don't normally hear from.

Mortgage debt increasing for people seeking bankruptcy

In a new report in the New York Times (subscription required), credit counselors are finding that mortgage debt is becoming more common in people seeking bankruptcy.

From the article:

“Mortgage debt is coming out as much more significant than we expected,” Ms. Keating said. “Pull this all together with the other unsecured debt people have, and this is really problematic.” The foundation, she added, will intensify its attention to mortgage counseling over the next year, partly in anticipation of more demand from consumers whose home loans are growing more burdensome.

The foundation has been surveying its members to gauge the effects of a federal bankruptcy law signed last year, which, among other things, eliminated some benefits of personal bankruptcy filing.

I'm Crying Again

As a follow-up to my previous post, I thought of a song by Mark Heard that expresses my feeling about how modern Christianity focuses all of their energy into the very thing that Jesus himself seemed to warn against -- while ignoring the very problems (people in need) that he said his followers should look after.

Evangelical Christians seem to be turning into modern day Pharisees. Some day I am going to do a post that spells out the similarities line by line.

I don't know if Christians getting involved in politics must become hypocrites by necessity, but it sure seems like those who preached piety in public life the loudest and attained the greatest amount of political power have been exposed to be the biggest hypocrites -- preaching discrimination against sinners, while committing the same sins in private. I remember hearing something about "don't point out the splinter in your neighbor's eye while ignoring the log in your own."

As I posted before, there are four basic corrupting influences. Politicians -- even Christian ones -- are susceptible to the corruption of power. Jesus said "you cannot serve God and money." You can say the same about power.

by Mark Heard.

The headlines in the dailies are the horses in a race
They lead you to believe that life and death are commonplace
Some believe it
And I'm crying again

I heard some good intentions and not all were second-hand
But bravado and pretension will not feed a hungry man
It's been said before
And I'm crying again

Very quietly
The world loses blood overnight
Without a fight
In the morning
The sickness will hide in the light
Out of sight

Running from a world that they will never understand
The masses ride their passions with the throttle in their hands
Nobody knows
What is waiting around the bend

Now and then the criminal in my skin lets out a sigh
He'd like to think he's innocent
But he cannot tell a lie
Truth is like a knife
And I'm crying again

From Stop the Dominoes Thanks to the Mark Heard Lyric Project

The Internet Monk on "The Passion of Haggard"

A few choice clips from the post:

"I am suggesting, therefore, that the increasing interest in the culture war among evangelicals is not an example of a reinvigorated evangelicalism remaking its culture. Instead, I believe the intense focus by evangelicals on political and cultural issues is evidence of a spiritually empty and unformed evangelicalism being led by short-sighted leaders toward a mistaken version of the Kingdom of God on earth."

"Evangelicals love a testimony of how screwed up I USED to be. They aren’t interested in how screwed up I am NOW. But the fact is, that we are screwed up. Then. Now. All the time in between and, it’s a safe bet to assume, the rest of the time we’re alive. But we will pay $400 to go hear a “Bible teacher” tell us how we are only a few verses, prayers and cds away from being a lot better. And we will set quietly, or applaud loudly, when the story is retold. I’m really better now. I’m a good Christian. I’m not a mess anymore. I’m different from other people.

What a crock. Please. Call this off. It’s making me sick. I mean that. It’s affecting me. I’m seeing, in my life and the lives of others, a commitment to lying about our condition that is absolutely pathological. Evangelicals call Bill Clinton a big-time liar about sex? Come on. How many nodding “good Christians” have so much garbage sitting in the middle of their lives that the odor makes it impossible to breathe without gagging. How many of us are addicted to food, porn and shopping? How many of us are depressed, angry, unforgiving and just plain mean? How many of us are a walking, talking course on basic hypocrisy, because we just can’t look at ourselves in the mirror and admit what we a collection of brokenness we’ve become WHILE we called ourselves “good Christians” who want to “witness” to others. Gack. I’m choking just writing this."

"Many of today’s pastors are entrepreneurs, not spiritual men at all. [They] are running organizations, living in front of an audience, talking about style and technology. They are shallow, ambitious and over-worked. Their families are on the stage. They are supposed to fill a dozen major roles. They are celebrities and motivational speakers."

A very interesting post by MaxedOutMama

The post discusses the devolution of democracies and the treatment of children in Islamic countries. It is a somewhat lengthy post, and I am doing some thinking about its premises.

MaxedOutMama is a regular poster at Calculated Risk.

P.S. I noticed that CR mentioned me in his post today. If you are here from Calculated Risk, Welcome!

Sunday, November 05, 2006

New Real Estate Ads in OKC

Last night, while driving home, I heard a radio advertisement for local real estate. The ad said something about "you may have heard about a housing bubble in other parts of the country" and sought to assure listeners that "real estate prices in Oklahoma City have grown at a steady and measured pace." The ad also pointed to the fact that interest rates are still historically low and that "now is a great time to buy."

Compare this to news coming out of Key West, Florida (from Mish's site, see links on the side of page) from poster FreeThinkerKW:

As longtime readers of this board know, I live in Key West where Real Estate tripled, quadrupled, and quintupled in the past 6 to 7 years. I alerted this board to the most unprecedented "happening" in Key West in my 16 years down here which took place yesterday, Saturday: an attempt to sell 22 homes at auction in a stalled real estate market.

Last week in Key West, only 1 home sold. The week before, 2 homes sold. The week before that either 2 or 3 homes sold.

Mind you that we now have 1400 to 1600 homes on the market, depending on the source of your information. Know too that there are approximately 300 to 600 homes being sold by owner which are not even listed in the MLS.

If we sold 2 homes a week in Key West, this inventory would last, oh, about 14 to 19 years at this rate. And as you will read, the asking prices of these homes are so out of reach for most people that the sellers must now face either foreclosure or drop their prices even more rapidly than they have already dropped.

I am about to lay the results on you from yesterday's auction. I am hoping you will be able to read the entire article without the Key West Citizen truncating it. If you cannot read the entire article, let me know, I'll send it to Mish, and then he can post it on his blog.

I can hardly wait. What I wouldn't give to be a bankruptcy attorney in Key West right now.

Anyway, Mish's Friend goes on to post:

Furthermore, I know someone mentioned in this article. I will not divulge his name as I don't want someone to google a reference to this auction and then they see my post come up alluding to his pain with his name prominently displayed. I don't want to add to his embarrassment and dismay. But I will say this: his remarks to the paper are not what he is telling me personally.

This builder is so underwater with unsold homes that he recently put his own luxury home on the market. He also has 7 brand new homes up on Stock Island, the next island up from us. Those homes, when first completed, were on the market for $550,000 to $700,000. They are on the market now for $400,000 to $500,000 with no lookers whatsoever. He might get lookers at $250,000. And he might actually get some buyers in the sub-$200,000 range, IMHO.
Mish posted a link to the article (free registration required). But he posted a significant amount so that you probably get a pretty good picture of what happened.

So, I wonder how long it will take to reach Oklahoma?

Locals Weather News

Last night on Channel 5 news (ABC) the weatherman made a comment about how today's rain would be good for Oklahoma, as we are several inches below normal this year, and several feet low over the last few years.

Speaking of weather, it has been noticeably quiet on the hurricane front this year compared to last year.