A few days ago the Des Moines Register published a lengthy article detailing how public employees' (taxpayer funded) benefits are far better than what private employers offer. Among other sources, the article referenced a well-known Iowa benefits survey done by a colleague and friend of mine.
This is another brick in the wall of why taxes are generally evil, and too high. We end up paying too much (in this case, compensation) to too many (in this case, public employees) without the invisible hand of the market to control it.
That's not even the point I want to make here. The point is, the article also quoted some politicians (in this case Iowa Democrats) who said they didn't feel they could do anything about it since the benefits are bargained for in good faith with state employee unions. But guess who's supposed to be on the taxpayer's side in those negotiations? Those same politicians and/or political appointees!
To be a state legislator and make the argument that you can't do anything to curtail state employee compensation is about as asinine an argument as you can make. That's like saying you murdered your parents, but can't be held accountable because you are now an orphan.
To add injury to insult, all of this is going on while Iowa has a $1 billion budget deficit thanks to those same politicians. Sure, there may be other bigger and better ways to cut spending, but to say this is off limits is nothing but pandering to the political left.
I'm a political independent - and proud of it - but if the Iowa Republican Party wants to win back the legislature and executive office, all they really need to do is get off their social conservative loser-of-a-horse and start focusing on the tried-and-true message of lower spending and taxes. But since Republicans have their own pandering issues, I suspect we'll just see more of the same.
Monday, November 30, 2009
Tuesday, November 24, 2009
I'm Thankful For This, But Not For That
It's Thanksgiving Week, my favorite holiday time, and like many others I am very thankful for the love and good health of my family and friends. The contrarian in me, however, chooses to blog today with a list of things for which I am not thankful:
Bad drivers.
Far right wing media personalities and outlets. (I exclude the far left wing media because I can't even confirm they exist.)
Snow.
The NFL's commercial-kickoff-commercial advertising strategy.
Techno-phobes.
Taxes that do not secure the blessings of liberty.
Alternative rap.
Anyone incapable of critical thinking.
Monday, November 16, 2009
Not Golfers, You Great Fool! Gophers!
Sandy: I want you to kill every gopher on the golf course!
Carl Spackler: Correct me if I'm wrong Sandy, but if I kill all the golfers, they're gonna lock me up and throw away the key...
Sandy: Not golfers, you great fool! Gophers! The little...brown...furry...rodents!
Carl Spackler: We can do that; we don't even have to have a reason. All right, let's do the same thing, but with gophers!
And later.....
Carl Spackler: License to kill gophers by the government of the United Nations. Man, free to kill gophers at will. To kill, you must know your enemy, and in this case my enemy is a varmint. And a varmint will never quit - ever. They're like the Viet Cong - Varmint Cong. So you have to fall back on superior intelligence and superior firepower. And that's all she wrote.
Carl Spackler: Correct me if I'm wrong Sandy, but if I kill all the golfers, they're gonna lock me up and throw away the key...
Sandy: Not golfers, you great fool! Gophers! The little...brown...furry...rodents!
Carl Spackler: We can do that; we don't even have to have a reason. All right, let's do the same thing, but with gophers!
And later.....
Carl Spackler: License to kill gophers by the government of the United Nations. Man, free to kill gophers at will. To kill, you must know your enemy, and in this case my enemy is a varmint. And a varmint will never quit - ever. They're like the Viet Cong - Varmint Cong. So you have to fall back on superior intelligence and superior firepower. And that's all she wrote.
Tuesday, November 10, 2009
Traditional Investing Is A Sure Loser
The following is an excerpt of a white paper about the secrets that traditional investment shops don't want people to know:
Let’s start by revealing how the traditional approach to investing almost inevitably results in worse outcomes. First, it must be understood that most investment advisors have learned their investment philosophy from the firms by which they are employed. What makes one financial advisor choose Mutual Fund A and another choose Mutual Fund B is largely determined by which of those respective fund companies has cut a better revenue sharing deal with the investment firm. Proof of this is readily available in firm annual reports.
It is a generally accepted business practice that clients will then own what funds or fund families a broker/dealer has the best revenue sharing agreements. This “pay to play” business model is disclosed to clients in the bowels of an annual report and little light is shed on this fine print. Herein lays the first of many identifiable conflicts of interest issues inherent inside the financial services industries.
The traditional investment approach used by most financial advisors is also an ‘active’ approach. In the mutual fund world where most investments are made, this means the industry is trying to own the ‘right’ mutual fund at the ‘right’ time.
Active investing, or picking the ‘best’ securities or funds, is in fact centered around the concept that advisors can beat the market by accurately predicting the future. This traditional approach wants you to ignore the fact that the aggregate market is a zero-sum game – and therefore ignore the mathematical certainty that any one individual’s gains must be matched by equal losses by other players.
This zero-sum game conclusion is even worse than it sounds. Factoring in the marketing, administrative, and other fees charged by most mutual funds (estimated to be more than $100 billion annually for just domestic equity mutual funds) investing actually becomes a negative-sum game. In other words, the very act of buying and selling of securities reduces the size of the pie that is destined to be divided equally among the various players. And the more frequent the buying and selling, the smaller the pie gets.
The traditional investing approach not only wants you to ignore the zero/negative-sum game fact, it also wants you to ignore the overwhelming academic research proving that few fund managers beat their long-term respective benchmarks. Here again, that fact is actually even worse than it sounds; statistically speaking, fewer managers beat their long-term benchmarks than would be expected to simply by chance. (In other words, they aren’t even good coin-flippers!)
So what's the alternative? The answer is an independent and passive investing approach, which is a blog topic for another day.
Let’s start by revealing how the traditional approach to investing almost inevitably results in worse outcomes. First, it must be understood that most investment advisors have learned their investment philosophy from the firms by which they are employed. What makes one financial advisor choose Mutual Fund A and another choose Mutual Fund B is largely determined by which of those respective fund companies has cut a better revenue sharing deal with the investment firm. Proof of this is readily available in firm annual reports.
It is a generally accepted business practice that clients will then own what funds or fund families a broker/dealer has the best revenue sharing agreements. This “pay to play” business model is disclosed to clients in the bowels of an annual report and little light is shed on this fine print. Herein lays the first of many identifiable conflicts of interest issues inherent inside the financial services industries.
The traditional investment approach used by most financial advisors is also an ‘active’ approach. In the mutual fund world where most investments are made, this means the industry is trying to own the ‘right’ mutual fund at the ‘right’ time.
Active investing, or picking the ‘best’ securities or funds, is in fact centered around the concept that advisors can beat the market by accurately predicting the future. This traditional approach wants you to ignore the fact that the aggregate market is a zero-sum game – and therefore ignore the mathematical certainty that any one individual’s gains must be matched by equal losses by other players.
This zero-sum game conclusion is even worse than it sounds. Factoring in the marketing, administrative, and other fees charged by most mutual funds (estimated to be more than $100 billion annually for just domestic equity mutual funds) investing actually becomes a negative-sum game. In other words, the very act of buying and selling of securities reduces the size of the pie that is destined to be divided equally among the various players. And the more frequent the buying and selling, the smaller the pie gets.
The traditional investing approach not only wants you to ignore the zero/negative-sum game fact, it also wants you to ignore the overwhelming academic research proving that few fund managers beat their long-term respective benchmarks. Here again, that fact is actually even worse than it sounds; statistically speaking, fewer managers beat their long-term benchmarks than would be expected to simply by chance. (In other words, they aren’t even good coin-flippers!)
So what's the alternative? The answer is an independent and passive investing approach, which is a blog topic for another day.
Sunday, November 8, 2009
Pet Lover Hater
I do not own a pet. This does not mean I do not like pets; I could see owning a faithful dog one day. But I'm not really a pet lover.
Moreso, I'm not a pet lover lover. I have a long list of gripes with people who act like their pets are human. I'm not just talking about the owners that let their pet crap on the grass and not pick it up. I'm talking about the owners that dress their pets in cutesy outfits, feed them with designer food, buy insurance on them, and take them along wherever they go. That's a little weird, and a little pathetic.
Excessive pet love has infiltrated the media, too. This past week the top story on two local TV stations was about a sheriff's deputy who shot and killed a neighbor's dog after allegedly being threated by it. Who knows what the truth was, but WHO CARES, a pet story should never be the top story on TV news! And that happens fairly often. If there aren't any better stories about human joy or suffering in central Iowa or the nation to report on that day, then just go with a half-hour of weather.
It also kills me how many people literally compare taking care of their pets as being similar to taking care of children. Really? Do they feed and diaper their pets as babies? Do they kennel their children when they're gone? Do they educate - I didn't say 'train' - them? Gimme a break. Show me someone who makes that comparison and I'll show you someone who's never had kids. Or is out of their freaking mind.
Look, pets can be great companions, givers of unconditional love even. I'm down with that. But in addition to controlling the pet population, let's start controlling the pet lover population.
Moreso, I'm not a pet lover lover. I have a long list of gripes with people who act like their pets are human. I'm not just talking about the owners that let their pet crap on the grass and not pick it up. I'm talking about the owners that dress their pets in cutesy outfits, feed them with designer food, buy insurance on them, and take them along wherever they go. That's a little weird, and a little pathetic.
Excessive pet love has infiltrated the media, too. This past week the top story on two local TV stations was about a sheriff's deputy who shot and killed a neighbor's dog after allegedly being threated by it. Who knows what the truth was, but WHO CARES, a pet story should never be the top story on TV news! And that happens fairly often. If there aren't any better stories about human joy or suffering in central Iowa or the nation to report on that day, then just go with a half-hour of weather.
It also kills me how many people literally compare taking care of their pets as being similar to taking care of children. Really? Do they feed and diaper their pets as babies? Do they kennel their children when they're gone? Do they educate - I didn't say 'train' - them? Gimme a break. Show me someone who makes that comparison and I'll show you someone who's never had kids. Or is out of their freaking mind.
Look, pets can be great companions, givers of unconditional love even. I'm down with that. But in addition to controlling the pet population, let's start controlling the pet lover population.
Monday, November 2, 2009
Real Men of Genius
For almost 10 years now, Bud Light has run a series of mostly radio commercials called 'Real Men of Genius.' These ads sarcastically glorify an unsung hero for a particular invention, or occupation, or just something they do. These are the funniest radio ads ever, hands down. Even the titles are funny. (Check the Wikipedia entry for Real Men of Genius for more about the ads, a list of every ad, and a link to the audio for each.)
Included in these Bud Light ads are spots about unappreciated inventors/inventions, like books on tape, or jean shorts. (Some inventions are better than others.) I've been thinking about these ads over the past month, the result of conversations I've had with people about great inventions that 1) are not fully appreciated, and 2) should have been discovered long before they actually were.
For example, the wheeled cooler. A fantastic and simple labor-saving invention. But decades ago we had wheels, and we had coolers, so why did it take so long for somebody to come up with wheeled coolers? Here's another: In-line roller skates. Think how that would have revolutionized roller derby! And in the food catagory, kudos to the walking taco inventor. There will be no royalties, but the dude who invented that has immeasurably improved our lives.
If you're reading this, I'd love to hear your 'Real Men of Genius' nominees in the inventor catagory. In the meantime, you should listen to those ads on the internet, and get ready to laugh.
Included in these Bud Light ads are spots about unappreciated inventors/inventions, like books on tape, or jean shorts. (Some inventions are better than others.) I've been thinking about these ads over the past month, the result of conversations I've had with people about great inventions that 1) are not fully appreciated, and 2) should have been discovered long before they actually were.
For example, the wheeled cooler. A fantastic and simple labor-saving invention. But decades ago we had wheels, and we had coolers, so why did it take so long for somebody to come up with wheeled coolers? Here's another: In-line roller skates. Think how that would have revolutionized roller derby! And in the food catagory, kudos to the walking taco inventor. There will be no royalties, but the dude who invented that has immeasurably improved our lives.
If you're reading this, I'd love to hear your 'Real Men of Genius' nominees in the inventor catagory. In the meantime, you should listen to those ads on the internet, and get ready to laugh.
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