Goodbye 2010

Things I didn't know much about at the start of 2010, that I know too much about now:

Vuvuzelas
Icelandic volcanos
Top-kill
WikiLeaks
Beiber
Chilean miners
Bed bugs
Glee
Jenn Sterger
Four Loko
"Taking My Talents to South Beach"

Grindin'

I grew up in far northwest Iowa. It was and still is a friendly and safe place to live, work, and raise a family. It also was and still is a very socially and religiously conservative place.

I could give you a number of examples of just how conservative (including how they keep electing Steve King to Congress), but one of my favorites was how one of the local parochial high schools canceled a dance once years ago, because the students were dancing too close to each other at the previous one. I always joked (still do) about how that community later implemented a ban on kissing, because they were afraid someday it might lead to dancing! Yes, it was close to a real-life version of the movie 'Footloose'.

It's 20+ years later, and while NW Iowa is still a very conservative place, it's not as repressed as it once was. With TV and technology, it simply can't stop societal evolution. However, this week I was reminded that no matter what, there will always be someone trying to stop that evolution.

Case in point, this week a parent in my own public school district (Johnston, Iowa, a suburb of big bad Des Moines) complained to high school administrators about the dancing they've seen at school functions. That parent had chaperoned a fall dance at the school, and wrote to school officials claiming that what he saw would best be described as "a sex act, albeit with clothes on."

Specifically, the dancing he's referring to is known as 'grinding'. Basically, it's guys dancing behind girls and rubbing their frontsides against the girls' backsides. The fact that this parent would use the term 'sex act' to describe this makes me think he has either an incredibly boring or incredibly interesting sex life - but I bet it's more like incredibly boring.

The best part about this story is that, just like my kissing/dancing joke, now everybody can poke fun at the parents and school administrators. It doesn't matter if they have a point or not. A Des Moines T-shirt shop has already sold more than 100 "Johnston: Straight Grindin'" tees, and if I was a student there I'd definitely get one, too.

This story certainly made me hark back to my cloistered youth, and laugh at the idea that today some people still think that controlling dancing is critical to controlling other teenage behavior. Aside from 'Footloose' it all makes me think of one other movie. In 'Jurassic Park', the Jeff Goldblum character/scientist is not convinced that the dinosaur population can be controlled via gender genetics, because in the end, "Nature finds a way."

He means that eventually, the dinosaurs will start kissing, and it will lead to dancing, and soon societal evolution will run amok!

Another Iowa Taxpayer Boondoggle

[Below is the text of an as-yet-unpublished letter I sent to The Des Moines Register last week. I've had several letters to the editor printed over the years, but I haven't written any recently due to lack of time and lack of confidence that anyone even reads that section of the paper anymore. Regardless, this letter follows the theme of every other one I've written - wasting taxpayer money.]

Before becoming too content with the recent 'good news' that the IPERS pension plan is improving while nearly $5 billion underfunded, one needs to more closely consider a statement from the consulting actuary that's buried in The Register's December 3rd article.

The actuary noted that one reason the projected shortfall has been reduced is due to changes in actuarial assumptions on the plan's liabilities. In other words, an accounting maneuver has simply made it look as though the plan will not cost taxpayers as much as before.

Those few who understand traditional pension plan valuation know that actuarial assumptions are often too optimistic, especially in public sector plans. In the end, the true cost of the IPERS plan - actual benefits and expenses paid - will very likely be much greater than currently projected.

Unfortunately, taxpayers won't be able to change an actuarial assumption to reduce their liability.

How To Tell If Something Is Fake

This time of the year there are an awful lot Santas out there. So how can people tell the real Santa from all of the fakers? It's simple really. The dude at the end of the Macy's Thanksgiving Day Parade is the real Santa. Anything else you see between then and Christmas Eve is just a faker, or as I told my kids, Santa's helper. God-given common sense should tell you the real Santa has too much to do at the North Pole!

Fake Santas may not be the best example of how to tell if something is real, but God-given common sense is. This brings me to today's actual topic: Bristol Palin's Facebook Page.

I don't use Facebook; I'm still trying to figure out how to leverage my Twitter account. However, Facebook-ers often use it to communicate crazy things that get mainstream media play. Bristol used it this week to defend herself against a fellow Dancing With The Stars contestant, Margaret Cho, who blogged that Bristol's politically famous mother, Sarah, made her do the show.

It would be perfectly fine and even righteous for Bristol to defend herself using her Facebook page - if it was really her writing the entries. If anyone reads the Cho defense entry, and compares it to the actual verbal quotes of this in-over-her-head (like her mother) kid, no one with any God-given common sense could believe that she actually wrote it.

Let's deconstruct it: She uses the word "canard". She refers to her mother's "bestselling book, Going Rogue". She even makes an analogy that includes KD Lang and the Indigo Girls! When someone who normally communicates at an 8th grade level ends up writing something that sophisticated, and with political innuendo, my 'faker' radar goes off.

So that same God-given common sense tells me this entry was written by a Sarah Palin political operative for damage control. Normally that would be fine - most 'celebrities' and executives use publicists or ghost writers to write statements or even books. But a Sarah Palin ghost writer on her own daughter's Facebook page? It sort of gives Cho's blog entry credibility - that Mama Grizzly is controlling what her kids say and do.

In a way, I feel for Bristol. She didn't sign up to be a Palin, to be under the microscope, and criticism sucks, especially through the media. But when Bristol signed up for reality TV (and the cash that came with it), she put herself on the media-watch list. (Um, that is assuming it really was her and not her mom that made her do it.)

The best path for Bristol now is to live her life with a quiet confidence, and stay out of the limelight a la Chelsea Clinton at her age. In the meantime, she can hope her mom's political ambitions don't take over her life.

No Love for the 99ers

At the risk of beating a dead horse.....

This week, the U.S. Congress did not act (yet) to extend unemployment benefits, meaning those benefits ended for millions of Americans. Of course, the Democrats are all aghast at the heartless Republicans for standing in the way of another UNFUNDED extension of these payments for who knows how long. But the Dems want you to ignore one little thing - that these Americans were in their 99th week of receiving those benefits!

Now as anyone reading this blog knows, I'm an independent / libertarian sort, and I really couldn't care less about either party's ideology, especially those on the fringe. But here, it's time for the Democrats / liberals to get real.

99 weeks of unfunded, taxpayer-subsidized unemployment benefits? 99 weeks! Are you telling me those folks could not find a job, or be re-schooled / re-trained for another job in almost two full years' time? I'm sure there are plenty of difficult situations, but I'm also positive there are employable people who are just fine with doing nothing and picking up their unemployment check. I personally know some of them.

I may not be the most compassionate person, but I'm at least compassionate-average, and I've had it with paying for people who don't work. I'm also skeptical anytime I agree with the likes of Senator Mitch "Turtle" McConnell, but our society cannot afford this. A certain U.S. electorate apparently agrees, considering the results of this past November.

Sorry 99ers, but we need to cut the cord on this abusive, one-sided relationship.

More Things For Which I'm Not Thankful

A year ago today, on the cusp of Thanksgiving Day 2009, I made a brief list of things for which I was not thankful:
http://streffblog.blogspot.com/2009/11/im-thankful-for-this-but-not-for-that.html

Today, on the eve of Thanksgiving Day 2010, I bring you more of those things:

Far right AND left wing media personalities. I'm now convinced the lefties exist, just not in as great of numbers. I also hereby expand this to include anyone outside the political mainstream, media or not. (I'm looking at you, Bob Vander Plaats.)

Iraq / Afghanistan / North Korea.

Subsidies.

Homophobes. (Again, I'm looking at you, Bob Vander Plaats.)

People who oppose medical marijuana at the least, and who oppose criminalization of marijuana at the most.

Anyone working on commission.

Malingerers.

People who live unhealthy lifestyles, especially if they're smokers.

Politics 1, Action 0

Now that the mid-term elections are over, and we have a presumed mandate to restrict spending in the country, you'd think we would begin to see some action on that front. But politics as usual will keep anything substantial from happening.

Already this week, Congress is debating the unfunded extension of unemployment benefits that will expire for some at the end of the month - benefits that already last up to 99 weeks. What's to debate?

Did we not all just agree by majority vote that we didn't want to do this anymore? I consider myself a social liberal, so I'm not averse to helping out the downtrodden. But I'm also a fiscal conservative, and we can't afford to keep paying people not to work. For a longer rant on that click here: http://streffblog.blogspot.com/2010/02/paying-people-to-not-work.html

So why aren't things changing? For one, it's a lame-duck session of congress, and I suppose the so the 'mandate' hasn't officially kicked in yet. But another reality is, both Republicans and Democrats feel like they can get more political mileage from doing nothing.

The Ds would use inaction to show how the Rs don't care about the unemployed, and the Rs would use inaction to get what they really want in two years, the presidency.

This week, Newt Gingrich was in town to promote his latest book. And Sarah Palin is scheduled to be in Iowa twice before the end of the year to promote her latest book, or maybe her TV show, who knows. From this, one can make three undeniable conclusions - the 2012 presidential election race has begun in Iowa, politics and political money never sleep, and we already have two unelectable people campaigning to be president. (Yes, folks, they are unelectable. Just ask Hillary Clinton if you can win as a polarizing figure.)

Just wait until we get some actual, electable people in the race - then for sure nothing will get done!

50 Words Of Advice For Investors

Focus on things within your control. Understand that in which you are investing. Choose an asset allocation that fits your own goals and risk tolerance. Know what your investment costs are. Diversify your investments as broadly as possible. Change your investments only when your needs or circumstances change. Be smart.

Best Song Lyrics (Part IV)

So far in this blog, I've covered songs from The Eagles, Dave Matthews Band, and John Mellencamp. There are lots of great songs and songwriters to go, and this IVth installment brings me to the classic singer/songwriter Billy Joel.

Here again, Joel has many good lyrics from which to choose, typically from uses a variety of relationship topics. I'm going with the following classic narrative from Scenes From An Italian Restaurant. Getting married too young still ends up like this:

Brenda and Eddie were the popular steadies / And the king and the queen of the prom
Riding around with the car top down / And the radio on
Nobody looked any finer / Or was more of a hit at the Parkway Diner
We never knew we could want / More than that out of life
Surely Brenda and Eddie / Would always know how to survive.

Brenda and Eddie were still going steady / In the summer of '75
When they decided the marriage would be / At the end of July
Everyone said they were crazy / "Brenda you know you're much too lazy
Eddie could never afford / To live that kind of life."
But there we were wavin' / Brenda and Eddie goodbye.

They got an apartment with deep pile carpet / And a couple of paintings from Sears
A big waterbed that they bought with the bread / They had saved for a couple of years
They started to fight when the money got tight / And they just didn't count on the tears.

They lived for a while in a very nice style / But it's always the same in the end
They got a divorce as a matter of course / And they parted the closest of friends
Then the king and the queen went back to the green / But you can never go back there again.

Brenda and Eddie had had it already / By the summer of '75
From the high to the low to the end of the show / For the rest of their lives
They couldn't go back to the greasers / The best they could do was pick up the pieces
But we always knew they would both / Find a way to get by

That's all I heard about Brenda and Eddie
Can't tell you more than I told you already
And here we are wavin' Brenda And Eddie goodbye.

Alcohol Defeats Marijuana Again (Sigh)

The following is from an article published on November 1, 2010:

"London, England (CNN) -- Alcohol ranks "most harmful" among a list of 20 drugs -- beating out crack and heroin -- according to study results released by a British medical journal, The Lancet. A panel of experts weighed the physical, psychological and social problems caused by the drugs and determined that alcohol was the most harmful overall. Using a new scale to evaluate harms to individual users and others, alcohol received a score of 72 on a scale of 1 to 100, the study says. That makes it almost three times as harmful as cocaine or tobacco, according to the article."

I bring this up as a precursor to one of my bigger disappointments from Election 2010. While some good things happened, such as Iowa replacing its pitiful governor, at least two states failed in attempts to pass laws that would have eased restrictions on marijuana use. South Dakota rejected medicinal marijuana (they obviously didn't pass along enough copies of my blog post on the topic at http://streffblog.blogspot.com/2009/08/medicine-and-marijuana.html), and California rejected a proposal that would have essentially decriminalized (at the state level) possession of very small amounts of MJ.

So to recap, people continue to use -and via advertising are encouraged to use - alcohol, but are severly restricted from not only using, but just possessing MJ. This is despite the fact that alcohol is just as addicting and mind altering, and based on the story above, far more harmful. (There was no mention in the article where exactly marijuana placed on the list of harmful drugs, but it obviously was less so than alcohol.)

Who knew it would be this difficult, well into the 21st century, to get Americans to understand how screwed up they are when it comes to using alcohol versus MJ. We have once again proven that we are, hands down, the most repressed free society in the world.

A Plan For Planning To Plan

The following is edited from a recent press release:

"The Community Foundation of Greater Des Moines and the Greater Des Moines Partnership are collaborating with local government, education, healthcare and other local business and community leaders on a strategic community and economic development planning process to create a shared vision and strategic plan for Greater Des Moines and Central Iowa. A community and economic development consulting firm will facilitate the work. The steering committee findings will generate an action plan with a long-term perspective, implementation strategies and a framework for measuring results and progress."

As someone with experience at a large Dilbert-like for-profit entity, as well as financially-inept non-profit entity, let me interpret this for you:

"As organizations that pay their employees from membership dues and/or taxpayers, we feel that every so often we need to act like we're doing something to justify our otherwise useless existence, not to mention our unnecessary jobs and salaries. Therefore, we're joining forces to have a bunch of meetings, which of course requires us to pay for the services of a consultant because that makes it look even more important. In the end, you can bet that we'll keep our jobs, the consultant will make a bunch of money, and nothing will actually come from this, except that members and taxpayers are going to get rolled."

Lighten Up, France(is)

When most people think of the country of France, they might think of Paris or romance or food. However, when it comes to the people of France, all I can think of is a bunch of wine-sucking, chain-smoking, work-strikers.

Case in point this week: Many French citizens have been protesting for days against the proposed increase of their retirement age from 60 to 62, leading to riots, school closings, and the shutdown of a major airport.

That's tremendous, France. You're already part of a socialistic Euro culture with a poor work ethic. Might as well take a few more days off to protest this very small change that will save your society from itself.

I especially get a kick out of how stdents are so involved in these rallies. They say it's because this later retirement age will keep people in the workforce longer, meaning the younger generation will be less likely to find jobs. Of course, this makes no sense, because the lower retirement age also means the student will ultimately pay higher taxes on the wages from those jobs, to allow the goverment to subsidize the above-60 crowd. (I think the real reason the students are rallying is because they don't want to work anyway, and by getting behind this protest, at least they can miss class for several days. More time to drink wine and chain smoke.)

Like most protests in France, I suspect this one is nothing to worry about. Both sides will surrender soon - it's another part of their culture.

A New Member Of The Tyson Zone

Today I'm naming a new political inductee into The Tyson Zone. (As a reminder, The Tyson Zone is named after former boxer Mike Tyson, and is the status an athlete or other celebrity reaches when his or her behavior becomes so outrageous that one would believe any story or anecdote about the person, no matter how shocking or bizarre. http://streffblog.blogspot.com/2010/07/politicians-in-tyson-zone.html)

It's social conservative and perpetual Iowa gubernatorial candidate Bob Vander Plaats. After another failed attempt this year at being nominated as the Republican candidate for governor, he is now leading a well-financed (by others outside Iowa) fight to remove 3 Iowa supreme court justices from the bench. Their sin? Being part of a ruling over a year ago that allowed gay marriage in Iowa.

I've said before I think it's up to the people of Iowa to decide this issue (http://streffblog.blogspot.com/2009/08/for-athiests-there-is-god-of-common.html),
but through legislative means, not this this way. Removing justices for a single and defensible, albeit controversial ruling is plain stupid.

However, simply trying to remove these justices isn't what gets Bob into the Tyson Zone. For that, you have to look at what he said this week in a debate on the issue, when he asserted the ruling opened the door to the possibility of polygamy, parents marrying their children, and other similar decisions.

Not sure if Bob really believes that, or if it's just more scare tactics from a bitter man. Regardless, after saying that, I don't see how there's anything more the guy can say or do that would surprise anyone. In short, social consevatives like Bob will say or do anything to get everybody to live in the same little box that they do, bordered only by their own idea of morality.

The truth is, regardless of how anyone feels about this ruling, Iowa's social climate and culture hasn't changed in the past 1+ year. Every once in a while, gay couples come here to get married, spend some money doing so, and then usually go back to their lives. It hasn't exactly become the Sodom or Gomorrah of the midwest, and on the plus side, at least we don't subsidize its economic impact with our taxes, like we do with ethanol.

Bob Vander Plaats, join your political soul mate Steve King in the Tyson Zone.

Major League Baseball Still Sucks

In case you hadn't noticed, the MLB playoffs have started. The World Series starts in two weeks - it's the November Classic now, you know.

If you didn't know any of this, it's understandable, considering this is still true.

http://streffblog.blogspot.com/2009/10/reasons-why-major-league-baseball-sucks.html

Not Everyone Cares About What You Do

So there's this lawyer from Des Moines who really spends his time being Mr. Adventurer Guy. He's tried to climb Mount Everest. He's tried to swim the English Channel. Not sure when he practices law, but he must have a high hourly rate or have a trust fund to take all this time off.

Anyway, although he's never been successful at climbing Everest or swimming the Channel, this year he's trying to do both again, the old "Peak and Pond' they call it. And to top it off, after swimming the Channel he's biking over to Tibet to get ready for Everest. He's calling it his World Triathlon.

Sounds cool, doesn't it? And I give him credit, he swam the Channel, and he's making his way over to Everest on the bike. But here's the thing - how do I know so much about this guy and what he's doing?

I know about it because this guy is a media whore! He has to make sure everybody knows about what a great adventurer he is, like he's Sir Richard Branson or something. Every time the guy goes on one of his treks, the stories appear in the paper and on TV, and I'm pretty sure they don't get the stories by word of mouth. Between trips he speaks to groups about his adventures, something I've snoozed through myself.

This year's quest, while admirable, has been the worst. This time he actually went out of his way speaking to raise money for his trip, convincing schools they could follow his quest on-line as some sort of geography lesson. Then the dude ran out of money to do that, even before getting on the bike. Sorry kids, but thanks for the free publicity!

Look, I hope the guy accomplishes his goal, but I don't need to know about it until after it's done, and everyone can live a good life without knowing about it at all. It seems the tree is falling in the forest, and he's terribly insecure that it won't make a sound if we all aren't around.

Maybe this guy should start living his life with a quite confidence instead of banging a gong every time he attempts to reach a personal goal. Some folks just don't understand - strangers don't care about you as much as you do.

The 'Secret' To Investing

It’s official. Again.

New objective research has confirmed what a mountain of prior evidence has long indicated. That is, investment fees are correlated to investment outcomes.

A new study by Morningstar, Inc. reveals the facts. In short, the lower the expense ratio – a measure of a fund’s total investment fees – the better the risk-adjusted performance.

What makes this study even more compelling is its source. Morningstar has long been considered the industry leader in mutual fund research and analysis, ranking funds using a star-rating system. Now, based on its own research, Morningstar admits their star-rating system takes a back seat to fees when determining the probability of a fund’s success.

So why do most ‘financial advisors’ continue to ignore the facts and invest in funds with higher expense ratios? Because their income is usually based on commissions received from the higher fees charged within the investment/insurance products and funds they sell. These higher fees mean a greater income for them, but a lower return for investors.

Lesson learn again: Don't pay more for something that adds no value.

Hikers Deserve Scorn Not Sympathy

We have a new leader in the clubhouse for the title of "Person Currently Getting Our Sympathy Who Really Deserves Our Scorn."

One of the top news stories in the past week was about Sarah Shourd, one of three Americans arrested last year while hiking near the Iran-Iraq border. Iran finally released her, and now she's doing the U.S. media ciruit talking about her captivity and urging the release of the other two male hikers (her fiancee and their friend).

Here's the thing: When asked why they were hiking so close to an unmarked border in such a dangerous part of the world, she acts like it was no big deal. They'd been staying in Syria, and were looking for a place to hike, and other people hiked around there, and they meant no harm, it was just a simple navagational mistake for which they were imprisoned.

Really!?

First off, people deserve what they get when they willfully choose to go hiking in one of the most volitile and lawless places in the world. It doesn't matter if you weren't spying. Frankly, it doesn't matter what you were doing. A lot of people there want to kill Americans, pure and simple. And don't you think maybe, just maybe, if there were people hiking there, they were locals who knew what they were doing and where they were going?

Next, to make matters worse, our Sarah met with the Iranian President - and International Madman - Ahmadinejad while he was in New York City this week on a United Nations visit. Nothing like giving that idiot more publicity by asking him to release the others. And this was right after that douchbag gave a speech suggesting the U.S. orchestrated the 9/11 terrorist attcks. Note to Sarah - again, that A-hole wants to kill as many Americans as possible. We shouldn't even allow him in the country to speak to the United Nations, a liberty no other country would give him.

Finally, has Sarah or anyone else thought about the huge amounts of taxpayers dollars that have indirectly gone to freeing them? You're welcome, Sarah, you immature loser. Why doesn't she mention this when she's talking about all of the hardships faced because of her own stupidity?

Since she was reportedly living in Syria because she was "fascinated by the region" I wish she would just go back over there and stop sucking up any more resources from America. And after she gets a lucrative and very undeserved book deal, I'm sure she will! Oh, and I'm sure she'll use that money to pay back us taxpayers.

Sarah, this scorn is for you!

Of Mosques And Book Burnings

When I started to write a blog, I initially wanted to stay away from politically or socially sensitive topics, and so not offend anyone who I might one day work with. As time went by I decided, screw it, I'm politically independent, I have as many good things as bad to say about any particular party or ideology. If people get angered by something I write, I'm willing to accept that risk.

And so we come to the issue of the proposed mosque that an imam is planning to bulid near Ground Zero in NYC. I'll also throw in the proposed Quoran-burning planned by a Florida pastor, because they do have a tangental relationship.

Americans have constitutional protections and, more specifically, first amendment rights. As a quisi-Liberitanian, I believe in that as much as anyone. Those rights effectively allow both the imam and the pastor to do what they are proposing to do. But in the end, I believe any reasonable person would reach the same conclusion for either one - neither should be allowed to do what they are proposing.

The first amendment does not grant absolute rights. For example, it doesn't give anyone the right to endanger others through their actions, such as shouting, "Fire!" in a crowded theater. It seems to me that age-old argument applies here. Both of these proposed actions are obviously going to cause potential harm to others, either physically or mentally, and the right to swing your arms ends where my nose begins.

In the past I've alwasys made a distinction between that which is insensitive (hurting someone intentionally) versus that which lacks sensitivity (hurting someone stupidly). Here the imam lacks sensitivity, while the pastor is being insensitive. Either way, they should recognize that, and fade into the backgrounds from which they came.

People want to make it out to be more than this, but really, isn't it that simple?

Best Song Lyrics (Part III)

It's hard to believe I waited until Part III to get to a John Mellencamp song. It will not be the only mention he gets - he has too many good song lyrics.

In fact, I'm going to reference two of them right now. First, these lyrics from the song The Real Life were the ones I actually used when I wrote some friends to tell them I was changing careers a few years ago:

Jackson Jackson [William Streff] was a good kid
He had four years of college and a bachelor's degree
Started workin' when he was 21
Got fed up and quit when he was 43
He said, "My whole life I've done what I'm supposed to do
Now I'd like to maybe do something for myself
And just as soon I figure out what that is
You can bet your life I'm gonna give it hell!"
He says
I want to live the real life
I want to life my life close to the bone
Just because I'm middle-aged that don't mean
I want to sit around my house and watch TV
I want the real life
I want to live the real life

I still don't understand why Mellencamp left that song off of his greatest hits CD years ago. Anyway, the next one is from an anthem for the ages, Check It Out. Similar to The Real Life, it's about letting time slip away, but in this case also regretting not doing something about it:

A million young poets, screamin' out their words
To a world full of people just livin' to be heard
Future generations, ridin' on the highways that we built
I hope they have better understanding
Check it out
Goin' to work on Monday
Got yourself a family
All utility bills have been paid
Can't tell your best buddy that you love him
Check it out
Where does our time go
Got a brand new house in escrow
Sleepin' with your back to your loved one
This is all that we've learned about happiness
Check it out
Get too drunk on Saturdays
Play football with the kids on Sundays
Soarin' with the eagles all week long
And this is all that we've learned about living

East Coast Media Bias

A lot has been made over the years about media bias, especially as it relates to politics. Somebody is always breaking down a news report, looking for key words or angles that are questionably liberal or conservative. This is really stupid, because even if it is true (and Fox News, I'm looking at you again), the last I checked everyone has the free will to made up their own mind. (Exception: Those who watch Fox News seem inclined to just swallow anything that Glenn Beck or Bill O'Reilly or Sean Hannity will say.)

But when it comes to one topic - weather - there is no doubt that we have media bias. To wit, this week the top story on the national morning news shows was always Hurricane Earl. Even when Earl was just a baby storm thousands of miles from the U.S. east coast, we were so very concerned about the threat. Now that it's scraping along the east-northeastern seaboard as an average-sized hurricane, it's like the end of the world.

So we have a storm, with literally days to prepare for, that may or may not affect the U.S., but that doesn't matter. The east coast has the largest population concentration - also TV viewers - in the country, and the east coast based networks need to make sure the nation knows about a potential weather event that might ruin their Labor Day weekend plans.

Note to news media: THE OTHER 99% OF THE COUNTRY DOESN'T CARE ABOUT HURRICANE EARL. It's had to imagine how anyone taking precautions would be harmed by this storm, yet in places like the Midwest we lose lives and property to sudden weather events all of the time. Ever see that get this much media coverage? Of course not.

It doesn't matter if it's weather, or news, or sports, the east coasters are the drama queens of the U.S. We've got real issues to talk about that impact the entire country, maybe we could focus on that?

Random Wallet Testing

In honor of the start of college football season, here's another past article by Rick Reilly of ESPN.com about a simple way to identify cheating in college sports.

http://sports.espn.go.com/espn/news/story?id=5468374


Along with Bill Simmons, ESPN.com has the best pound-for-pound sportswriting going now.

Dumb Rules

It might take a bit to get to my point, but follow along here.....

The other day I played golf at a local course that, like many courses in my area, had some flooding damage. In this case, large portions of several fairways were comprised of compacted dirt that remained after the floodwaters receded. In the end, this meant that hitting from some fairway lies was like hitting from a mixture of dirt/sand.

This made me think of this year's PGA Championship at Whisting Straits in Wisconsin, where one of the leaders was assessed a two-stroke penalty on the final hole for grounding his club in a sand trap, which neither looked like nor was maintained as a bunker.

This made me think of a fantastic column by ESPN.com writer Rick Reilly, on what a dumb rule that was, along with many other dumb rules of golf. (Read it at this link:
http://sports.espn.go.com/espn/news/story?id=5470940)

This made me think - now to the point - of a few other dumb rules (laws?) in life. To wit:

*Motorcycle helmet laws. If someone wants to crack their skull open and die - the primary outcome of a helmet-less motorcycle accident - and no one else is hurt, why should we care? It isn't like a seat belt law, because people in cars who don't wear those restraits will often still survive accidents, but then are permanently disabled, which puts on cost on society. Speaking of death and dying.....

*Bans on 'assisted' suicide. Again, if someone wants to end their own life, in this case with dignity, who else is harmed by that?

*No instant replay in baseball or soccer. We have the power of technology, but not the will to apply it. (Kind of like 'assisted' suicide.) If you have to defend something using the old 'integrity of the game' argument, consider yourself on the losing side of the argument.

*Criminalizing the possession of marijuana. Just go to the keyword 'marijuana' for this blog to find out all you'll ever need to know about why this is in the dumb rules Hall-of-Fame.

*Continued extension of unfunded unemployment benefits. Paying people to not work is not a viable or sustainable national economic policy.

*24/7 'citizenship' policies in schools. Schools have a hard enough time policing kids at school / school activities, why do they think they should also police the kids' behavior outside of school? Regardless, they don't have my permission to do it, so they need not bother.

Women Are Better Than Men.....At Investing

Here's a controversial thought: Men and women are different.....in terms of how they invest.

A variety of studies have been done on gender-based financial behavior. The 2007 Sharebuilder Women and Investing Survey finds that women tend to be more involved in the family balance sheet. Just over 60% of women manage the household checkbook; 58% pay the bills; 44% (versus only 23% of men) oversee the budget.

Yet only 15% of married women take primary care of the family investments. This in spite of the finding that, when it comes to choosing investments, women tend to be more diligent, spending almost twice as much time researching mutual funds before investing. This could be due to greater caution on the part of women, or, depending how you look at it, greater confidence on the part of men. Whatever the cause, it pays off for the ladies. Finance professors Brad Barber and Terrance Odean find that—though women hold less risky portfolios than men, pursuing (and expecting) lower returns—after adjusting for differences in risk, women achieve better returns.

Before women take a victory lap, note that there is a larger, gender-neutral point: Overconfident investors trade too much. Barber and Odean take pains to assure us that gender is but a convenient statistical tool for the real factor at work – overconfidence. Psychology researchers have long held that men are more prone to overconfidence, so we'd expect them to trade more aggressively. We'd also expect this trading to increase costs, which in turn will reduce performance. To test this, the authors set out to determine if the population that is naturally overconfident earns lower average returns than the population that isn't. (See? It's not about men and women at all!)

The professors analyze a huge database of brokerage accounts from the 1990s. They find that married men trade 45% more than married women and earn annual risk-adjusted net returns that are 1.4% lower. Moreover, the differences widen when the sample isn't married people: Single men trade 67% more than single women and earn annual risk-adjusted net returns that are a full 2.3% lower. Worse still, the men have average turnover (a measure of trading frequency) of 77% per year, while the women have average turnover around 53% per year. (Both of those percentages are high – maybe both groups need advisors instead of commission-paid brokers!)

If you believe the stereotypes, these results shouldn't surprise you. Men are supposedly brought up to embrace competition and risk. This translates into winning short-term sprints, not waiting out marathons in broadly diversified strategies. Sure, research is great, but guys don't like to ask for directions. Women, on the other hand, are more likely to avoid knife-fights, or take a flyer on some dicey investment. The research shows they're also more likely to seek out data and expert help, and to take their time – perhaps too much time – before committing assets.

In the final analysis, it’s best for both genders to avoid the pitfalls of emotional investing, the symptoms of which are frequent trading and/or improper asset allocation. Successful investing requires a mixture of confidence and caution, along with a healthy dose of objectivity, patience, and knowledge. These traits will make better investors of both men and women.....and there’s nothing controversial about that.

More Observations From The Iowa State Fair

A year ago I blogged about seeing way too many overweight people at the Iowa State Fair. I also went on to suggest a tax that might help stem the tide of obesity in Iowa/America.
http://streffblog.blogspot.com/2009/08/tax-on-fat-people.html

During my annual visit to the fair this year, I made a few more observations:

*Tattoos are everywhere, and I'm not talking about the little guy from Fantasy Island. I'd estimate 1 out of every 10 people at the fair had a tattoo, but increase that to 1 out of every 5 people under the age of 40, and 1 out of every 3 between the ages of 20-35. And that only counts the visible tattoos; it might be 50% or more under age 35. It's just part of being young now, similar to ear piercing in my generation.

*If you want to surpress your appetite, closely watch what's happening in most of the temporary food stands. They're often dirty and smelly, meaning both the stands and some of the people working in them. And the food is, um, greasy. One image I still can't get out of my head was the guy who turned over the french fries basket to dump the latest load in a pan - only to have it fall out of the basket still molded in the rectangular shape of the basket! Perhaps this is actually a new fair food item: French Fry Loaf.

*Free entertainment at the fair still kicks butt. There's a variety of live music, demonstrations, and contests to watch. This year I caught a glimpse of the Mr. Legs Contest. As I tweeted at the time, I chose not to participate because I didn't want to demoralize the competition, and because I don't think it's right for pros like me to compete with amatuers. Regardless, the price of admission buys you a lot of value at the Iowa State Fair.

*Generally speaking, people are still fat.

A Solution In Search Of A Problem

When taxpayer money is used for so-called community betterment, I tend to want to put my hand over my wallet. Most of these projects are don't solve anything, and actually make matters worse by taking funds from more worthwhile things (like my bank account).

In the span of a couple of hours today I came across two seemingly unrelated items that, upon further review, are completely related. They are both items of community betterment, and they are both publicized as something we citizens should be proud of, but they are also both a waste of taxpayer time and money.

First the more obvious one - middle-of-the-road bicycle lanes. Even though I'm a biker, this has got to be one of the dumbest ideas since new Coke (maybe the best example ever of fixing something that wasn't broken). There is nothing wrong with staying on the right side of the street and sharing the road, or even better, bike lanes along the curb side of the street. But down the middle? One of my favorite bike routes recently added these lanes, as have other parts of Des Moines, and believe me, it does not make biking safer, it makes it more dangerous. Aside from the lack of need, don't forget, taxpayers paid for this lane remarking too! WTF!

Now the less obvious one - new school construction and/or remodeling. I'm all for good physical school facilities, but reading about the summer projects being completed in our suburban school district should make taxpayers cringe. It isn't just the multi-million dollars being spent on over-the-top common rooms and equipment, it's how the district brags about it. "Hey, look at all of this taxpayer money of yours we're spending! It must have been growing on trees because there it was, so we spent it!" I've yet to see any study that directly correlates school building spending with better student-citizens. If the district cares about that, wouldn't they (also wrongly) hire more teachers, or at least keep the ones they have? (Shhhhhh.....don't say anything about school districts here are laying off teachers because the state is running out of money thank you very much worst governor ever Chester Culver.)

When a lot of time and money gets wasted on things that don't do any good, that's a solution in search of a problem. Funny how it usually happens in the governmental, not-for-profit world.

Thoughts on RAGBRAI 2010

For the uninitiated, RAGBRAI stands for the Register's Annual Great Bike Ride Across Iowa. It's a weeklong trek of about 10,000 bicyclists, who ride roughly 60-80 miles per day from the western to eastern border of Iowa. (If you need to know more go to ragbrai.com.)

2010 marked the 38th RAGBRAI. I've been on all or parts of 9 or 10 of them, including the third RAGBRAI when I was just short of 11 years old. Owning a 10-speed bike was a big deal then; helmets and biking jerseys were not.

This year I rode from Sioux City to Storm Lake on Sunday (72 miles) and Storm Lake to Algona on Monday (100 miles). (If you followed me on Twitter at @streffbuddy, you'd have received rolling updates!) RAGBRAI has evolved over the years, and mostly in a good way, with a few exceptions. Here are my thoughts from this year's ride:

*The average age of riders keeps going up. The aren't so many in the 20-29 age group anymore, and that used to be the main age not so long ago. RAGBRAI is slightly more family-friendly now, and it's mostly comprised of people in their 30s and 40s, and plenty in their 50s.

*RAGBRAI riders used to be in better shape than they are now. About half of today's riders would be considered overweight, and wearing tight bike shorts doesn't help their appearance. This may be correlated to the average age being higher, but it more directly correlates with Americans' poor diets. Even factoring in what can be burned off during a 450 mile week of bike riding, I'd say many riders have a net weight during RAGBRAI week, plue they generally eat and drink too much and don't exercise enough for the other 51 weeks of the year.

*Speaking of caloric intake, while there is a lot of food and beer consumed during the ride, there really aren't enough food and beverage vendors along the way. I think most communities on the route simply can't get their mind around how much eating and drinking is done by the thousands of riders in a short period of time. Lines have become way too long. In conjunction with this, there aren't enough portable toilets, either. Plenty of tall corn on the roadsides, though.

*The ride and riders are much safer now. I never saw a single rider without a helmet. Law enforcement keeps vehicles off of the route in both directions, and there are ambulances dispersed at short intervals. Still, there were several crashes, some serious. I personlly saw two riders go down crossing some railroad tracks. (They were going slow so they were not seriously injured, other than bruised egos.)

*What once was a given on RAGBRAI - church-run pie stands - has suddenly become obsolete. I saw a total of two places selling pie, in two days, and one of them had run out. It seems like the only sweets being sold on the route now are cookies and bars. I'm used to having one or two pieces of fruit pie every day on the ride. WHAT HAS HAPPENED TO THE PIE ON RAGBRAI?

In summary, RAGBRAI is still a fun and challenging endeavor. Everybody should put it on their bucket list, at least for a day or two.

Politics And The Tyson Zone

One of my favorite sportswriters/columnists, hands down, is Bill Simmons "The Sports Guy" of ESPN. (P.S. You should follow him on Twitter @sportsguy33.) He writes entertaining, epic length columns full of pop culture references.

Over the years, Simmons has also coined a number of phrases for which he associates and ranks a group of people or things. For example, a recurring Simmons topic is the "13 Levels of Losing" where he defines and ranks the most painful ways for a sports team to lose, like the "Stomach Punch" (a game that ends with an opponent making an improbable and game-winning play).

One of Simmons' other themes is called "The Tyson Zone," and named in honor of boxer Mike Tyson. The Tyson Zone is the status an athlete or other celebrity reaches when his or her behavior becomes so outrageous that one would believe any story or anecdote about the person, no matter how shocking or bizarre.

I've been thinking about how The Tyson Zone applies to so many people now on the political landscape. There might be a waiting list at this point, given all of the strange extremist views coming from Tea Party activists (I'm looking at you, Sarah Palin) and media goofballs (I'm looking at you, everybody on Fox News). And yes, there are plenty of Democrats that belong in it, too.

But there is a special place reserved in The Tyson Zone for Iowa's own Congressman Steve King. Over the years his greatest hits include openly insensitive remarks disparaging minorities, homosexuals, immigrants, Muslims - basically anybody who doesn't look or think like him. Dude has already earned a lifetime membership in The Tyson Zone.

If Steve King is a member of The Tyson Zone, what about all of the people who keep voting to re-relect him? It doesn't say a lot for them. On the other hand, when Mike Tyson went berzerko, it didn't stop poeple from going to his fights, either. Maybe King's constituents have been hypnotized in the same way.

Regardless, I'm convinced if you peeled back Steve King's skin you'd find some primordal creature underneath. He is.....a Martian.....in The Tyson Zone.

No Time For Timing

Most investors who want to move their funds out of the stock market regard their potential action as a temporary move to the sidelines, rather than a permanent decision. Their proposed strategy is to “time the market” and attempt to ride out the storm in the shelter of the harbor, only to set sail again when the weather improves.

The volatility of the past quarter has once again led some down this market timing path, but there are obvious problems with this tactic. Perhaps the main one is, once an investor decides to leave the stock market, exactly when should they return?

Investors may believe it is prudent to wait for economic stabilization as a sign the stock market will recover. However, the market is typically a leading – rather than trailing – economic indicator. So by the time the weather appears clear from the harbor, the tide may have already gone out.

In truth, correctly timing your exit and entry to the stock market is sheer luck. If it were as simple as some claim, millions would be doing it and getting very rich in the process, promoting themselves and their timing strategy.

Consider this: How many so-called investment experts correctly got out of the stock market completely by October 2007 and moved into government bonds, then bought back stocks again in early March 2009, and then reversed course back to cash and bonds again in early 2010?

The short answer is, NONE. Most investors who played the timing game left the stock market between October 2007 and March 2009, and then re-entered later in 2009. They sold low, bought high, and felt miserable in the process.

As I’ve stated many times, no one can predict the future, and no one should attempt to time the stock market. By maintaining a long-term strategic asset allocation (the amount split between stocks/bonds), and practicing disciplined, periodic rebalancing, investment decisions can be based on personal needs and risk appetites, and not on the emotion of the moment.

Uncertainty will always be an integral part of investing (and life). No one has or will come up with a consistently successful strategy for timing the market, and investors would be much better off focusing on things they can control.

Best Song Lyrics (Part II)

How about this from Dave Matthews Band in their song, Grey Street, about how some people aren't willing or able to break free from the drudgery of their lives.

There's a stranger speaks outside her door
Says take what you can from your dreams
Make them as real as anything
It'd take the work out of courage
But she says "Please
There's a crazy man that's creeping outside my door,
I live on the corner of Grey Street
And the end of the world. "
There's an emptiness inside her
And she'll do anyrthing to fill it in
And though it's red blood bleeding from her now
It's more like cold blue ice in her heart
She feels like kicking out all the windows
And setting fire to this life
She could change everything about her
Using colors bold and bright
But all the colors mix together - to grey
And it breaks her heart

The Return Of the Blog

What do you call a blog with no entries in nearly a month?

Not a blog.

So I've been busy. Trust me, it hasn't been for a lack of things to write about.

I shall soon return with a steady stream of insight.....

Best Song Lyrics (Part I)

Like most people my age, I miss the good old days when song lyrics meant something. There are still plenty of good songwriters out there, but they are mostly being drowned out by the commercialization of today's music industry.

I didn't always feel that way. When I was in my teens and 20s, all I cared about was the beat and popularity of a song. Not much has changed for today's youth, except that now it's hip-hop and rap music with empty (or stolen) lyrics, instead of disco.

But eventually you mature, and realize that music without meaning is pointless. So I've decided to begin a recurring blog entry about what I consider to be great song lyrics. Note that I am the sole arbiter of what's considered great, but I welcome your comments and suggestions.

Let's start with these lyrics from the Eagles and their song about addiction, Hotel California.

Mirrors on the ceiling
The pink champagne on ice
And she said,
"We are all just prisoners here, of our own device."
And in the master's chambers,
They gathered for the feast
They stab it with their steely knives,
But they just can't kill the beast
Last thing I remember, I was
Running for the door
I had to find the passage back
To the place I was before
"Relax," said the night man,
"We are programmed to receive.
You can checkout any time you like,
but you can never leave!"

Watching Golf In Person

One of the reasons I did not write in the blog last week was that I spent time watching one of my kids play in the Iowa Girls' State High School Golf Tournament. After being at much of that 2-day tournament, plus other meets duing the year, here are some observations about high school girls' golf:

1) Girls golfers have a much better temperment than boys. Case closed.

2) Girls golfers are not nearly as good at putting as boys. Why is this? I compared it to driving a car, meaning young females are not as good as males at that either. Yes, boys are more reckless, but they are innately more competent at driving at a younger age.

3) Girls golfers play faster than boys in regards to addressing the ball and hitting the shot. This is not always a good thing, but it is good more often than not.

4) Girls golfers' moms are very much helicopter parents when watching golf. Most of them know absolutely nothing about the game, other than their husbands play it, yet they are deeply concerned about every stroke their daughter takes. It's actually a bit annoying to us dads, to have a spouse encroaching in our territory!

And speaking of women encroaching on mens' golf territory, I felt the same way while attending a day of the PGA Senior Tour event in Des Moines last week. The place was crawling with girlfriends and wives (and perhaps mistresses) who were only there to look good, and eat and drink at the corporate tents. These fakers are much worse than the helicopter moms, because at least the moms are genuinely passionate about what they're watching.

In the end, watching golf in person is significantly less satisfying than playing golf.

Looking Like An Animal

In honor of golf season, I bring you more quotes from greenskeeper Carl Spackler:

"I have to laugh, because I've outfinessed myself. My foe, my enemy, is an animal. And in order to conquer an animal, I have to think like an animal, and, whenever possible, to look like one."

"This [grass] is a hybrid. This is a cross, ah, of Bluegrass, Kentucky Bluegrass, Featherbed Bent, and Northern California Sensemilia. The amazing stuff about this is, that you can play 36 holes on it in the afternoon, take it home and just get stoned to the bejeezus belt that night on this stuff."

Dear Graduating Class of 2010

Among the great mysteries of our day is, how come I've never been invited to give a commencement address? I think I'd be very good at it.

Alas, it appears this will remain on my bucket list for another year. In the meantime, what follows is an excerpt from a commencement speech given by Stephen Colbert to Knox College in 2006. I couldn't have said it better myself, and besides, I didn't need to:

Today is about you — you who have worked so hard to pack your heads with learning until your skulls are all plump like a sausage of knowledge. It's an apt metaphor, don't question it. But now your time at college is at an end. Now you are leaving here. And this leads me to a question that just isn't asked enough at commencements. Why are you leaving here?

This seems like a very nice place. Besides, have you seen the world outside lately? They are playing for KEEPS out there, folks. My God, I couldn't wait to get here today just so I could take a breather from the real world. I don't know if they told you what's happened while you've matriculated here for the past four years. The world is waiting for you people with a club.

There are so many challenges facing this next generation, and I don't know if you're tough enough to handle this. You are the most coddled generation in history. I belong to the last generation that did not have to be in a car seat. You had to be in car seats. I did not have to wear a helmet when I rode my bike. You do. You have to wear helmets when you go swimming, right? In case you bump your head against the side of the pool?

But you seem nice enough, so I'll try to give you some advice. First of all, when you go to apply for your first job, don't wear those robes. Medieval garb does not instill confidence in future employers — unless you're applying to be a scrivener.

And if someone does offer you a job, say yes. You can always quit later. Then at least you'll be one of the unemployed as opposed to one of the never-employed. Nothing looks worse on a resume than nothing.

Uncompensated Risk In Investing

With the market gyrating like it's 2008 again, now seems like a good time to re-visit the unbreakable relationship of risk and reward.

While market returns can be defined in many ways, most media outlets and investment shops have come to use the S&P 500 as their benchmark for return. Unfortunately, comparing the return of the 500 largest U.S. stocks against a diversified portfolio is a very poor, even unacceptable measurement of performance. After all, most portfolios are comprised of both U.S. and foreign stocks, plus corporate and government bonds, real estate or other commodities, and cash equivalents.

When discussing investment returns, you’ll typically hear me refer to “risk-adjusted return” as a measure of how well a fund or portfolio did over a specific time period. Simply put, if two different funds/portfolios had a 10% return, the less risky one – perhaps one that owns more bonds than stocks – would have a much better risk-adjusted return

So to fairly and accurately measure a diversified portfolio, it must be adjusted for style and risk. For example, a portfolio that has been established for an investor may have a target allocation of 60% stocks and 40% bonds. In that case, the stocks and bonds should be broken down by type, (e.g. U.S. or foreign, small or large, etc.) and the returns for each then compared to their applicable benchmark. In this light, no one would reasonably compare such a 60/40 portfolio’s returns with the S&P 500, much less draw rational conclusions from it.

One method to adjust for risk is through a fund’s standard deviation, which measures its volatility. A stock fund, which is more likely to have returns that yo-yo, will have a high standard deviation. In contrast, the standard deviation of a fixed income or bond fund will be lower, or more likely to be in line with its expected historical returns in any given period of time.

Generally speaking, the returns of more stock-based models come with higher standard deviations, and therefore, higher risk. In the 12-15 months ending in April 2010, investors were compensated for this risk through higher returns. As you might guess, however, risk was not so well compensated throughout the past decade (or even the past month), when much safer fixed income investments performed as well as – or even better than – stocks.

Understanding the basics of risk-adjusted return will make you a more successful investor. It follows, then, that successful investors - and successful people - avoid uncompensated risk.

Cartoons Can Never Hurt Us

It's long been a fact that some of the best satire on TV doesn't even involve human interaction. Of course I'm talking about The Simpsons and South Park.

Not only do these long-running cartoons provide a visual entertainment that can't be done with people, and not only are they funny, but they are brilliantly written in a way that makes fun of society's ills.

I prefer The Simpsons and its lesser shock-value way of doing things, but today I'm focusing on South Park in light of the recent threats to its producers for their depictions of the prophet Muhammad. In short, for the second time in recent years, South Park has been edited to pander to Muslim extremists who think their prophet cannot be viewed, much less parodied. (To read more about this, simply type the words 'South Park Muhammad' into any search engine.)

Anyone who watches South Park knows that for years they've made fun of any and all things, including religions and religious leaders. There is no favoritism, they draw everyone, and all are potential targets. The only difference is, Muslim extremists apparently think depicting Muhammad in a cartoon today is a death sentence for those who dare do it.

It's worth noting that while the majority of Muslims might be insulted by South Park, they’re not calling for death to the show's creators. But it's also worth noting that this is a country that looks down on censorship. It’s not a crime to parody religion in America, but it is a crime to allow freedom of speech to be impacted by extremists who threaten death in the name of religion or politics.

Here's an idea for those extremists: Stop watching South Park. How do you get TV reception in that cave, anyway?

Deadbeat Lottery Winners Are Still Losers

This week a (stereotype alert) gapped-toothed hillbilly from Missouri won a $250 million lottery jackpot. I've got nothing against bad teeth, hillbillies, Missouri, or jackpots, but let's take a closer look at how this happened.....

The GTH (gapped-toothed hillbilly) bought his $5 ticket at the end of his shift at the convenience store where he worked. In the same purchase he also bought himself some cigarettes, so let's just say that was another 10 bucks.

Seems innocent enough - until you factor in the GTH 1) was also way behind on his electric and gas bills; 2) had less than $30 in his bank account; 3) owed $1,000 to a friend on a truck he recently bought, and 4) apparently has three children to support, along with his girlfriend's two children.

A quick analysis - the GTH had no money to pay bills or to care for his kids, and was deeply in debt to a friend, but still figured he'd spend half his life savings on a lottery ticket and cancer sticks. ARE YOU SERIOUS!?!

The moral of the story is, even if you are a deadbeat GTH who should be paying bills instead of gambling, you could still win the lottery. Also, lending practices in this country are even more lax than we thought, since this GTH found someone dumb enough to loan him $1,000 he could never repay - unless he won the lottery.

I can only think of one good thing to come of this - we've got one less person/family who will be using the social services saftey net. As the GTH might say, "Yippee!"

Managing The Madness

The NCAA men’s basketball tournament recently gave us many exciting moments, with unexpected wins by some teams and unexpected losses by others. It truly was March Madness.

In many ways, the NCAA tournament parallels my view of the stock market. It’s clear the tournament as a whole has been a solid and successful venture for college basketball for decades, regardless of the teams involved. The same is true of the broad stock market, which has also been a successful venture for investors for decades, regardless of the stocks that comprise it.

However, as with individual stocks, the success of individual teams in the NCAA tournament cannot be so easily predicted. Each year, many ‘experts’ predict that higher-seeded teams will be winners based on recent past performance…..but each year unforeseen events occur that result in those teams losing, ‘busting brackets’ across the country. Similarly, each year many ‘experts’ predict which stocks or mutual funds will be winners based on recent past performance…..but each year unforeseen events occur that cause those stocks/funds to be losers, busting investment portfolios across the country.

Despite this proven randomness, many investors still try to follow the trends, outfox everyone else, and beat the market. The truth is, no one can actually pull that off over a long period of time. Some may get lucky with a few picks. Some may even enjoy a sustained run. But in the end, the market tends to be a bust for investors who misjudge its fickle swings.

Much like the NCAA tournament, the market is a creature that defies predictions. While it may seem logical to buy into a team (Stock A) that has better recent results, there is no guarantee it will be a better choice going forward than another team (Stock B) with recent losses. Put another way, “Has done” is no guarantee of “Going to do.”

The better way to invest is to recognize the market’s unpredictability, and use that knowledge to increase the likelihood of higher long-term performance. To that end, my investment philosophy takes an extraordinarily broad-based and low-cost approach, thereby avoiding any built-in biases toward the current ‘favorite’ stock or market sector. In essence, I invest in the tournament, not the teams!

When it comes to the NCAA tournament, people should enjoy the Madness. When it comes to investing, however, people should stop the Madness, and get the predictability, performance, and peace of mind that comes from a more certain approach.

The Masters.....Of Hypocrisy

There are many words one might associate with what is possibly the most famous tournament in golf, The Masters: Golf, green, jacket, Augusta, patrons, Jones, magnolia, etc etc. But now we a have new one - hypocrite.

The day before this year's tournament started, August National Chairman Billy Payne decided to call out Tiger Woods for generally being a bad role model. There would be little disagreement with that from anyone, but consider the source - the chairman of an exclusive club that does not allow women as members, and only allowed its first minority member in the late 20th century.

I suppose a club (that doesn't get tax exemptions) is entitled to discriminate as it sees fit. To hear it preach to others about conduct, however, is a joke.

Really Billy Payne? Really, you are calling out others for not being role models, when your club has long-standing discriminatory practices? Really?

Leave it to The Masters - a tradition like no other.

Indoor Tanning Gets Burned

One of the items jammed into the new health care reform law is a 10% tax on indoor tanning services starting July 1. I rarely say this about new taxes, but in this case, Bravo!

I've stated many times before that taxes are generally bad, and should be opposed unless they are used to establish justice, ensure domestic tranquility, provide for the common defense, or promote the general welfare. Granted, that last one is way too flexible, but I take "promote the general welfare" to mean good roads, schools, water, etc, AND that we should not be encouraging people to voluntarily harm themselves in a way that requires society to pick up the tab.

That's exactly what tanning salons do. They drill a body with harmful UV rays that promote skin cancer, which eventually leads to increased medical care, the costs of which eventually will be borne directly or indirectly by society through higher private medical premiums and/or indigent medical care from taxpayers.

The con argument is the same crazy one that smokers use to complain about the cigarette tax. Instead of "I have a right to smoke," it's "I have a right to tan." Well then, society has a right to tax you because it will be paying for your dumb decisions later.

Another con argument out there sounds more logical, but is actaully even more ridiculous. That's the idea that we don't tax people who don't wear helmets when riding motorcycles, which is a lot riskier. But the thing is, when motorcylists crash without helmets, they usually die, and society bears no ongoing medical cost.

To be fair, I think we should slap the same tax on some other things. Fast food restaurants come to mind. If we're keeping it real, the fatty foods and soft drinks they sell are enablers for everything from diabetes to heart disease. Ingesting that stuff is a choice to have an unhealthy lifestyle, just like smoking and tanning, and choices have consequences that should not be socialized.

So for all you indoor tanners out there who feel like it is better to look good than to feel good, thank you for your vanity, and thank you for the new source of federal tax revenue!

Obligatory UNI Post

This week the United States reformed its health care system. Here is my analysis: I think....

Waaahhh! Wait a minute! The University of Northern Iowa (UNI) Panthers made the NCAA Men's Basketball Tournament Sweet 16 by beating heavily favored Kansas. Gotta mention that.

Not much in sports is going to top seeing an underdog Iowa group beat down one of the best teams in the country, and get all kinds of attention for it. I suppose it would have been better if they had beaten a more hated team, a team known for cheating coaches and/or players.

I happened to watch the game at a bar with friends and family, and it was possibly the most fun I've ever had watching any sporting event on TV. Loud cheering, drinks, and a gratifying outcome is a great combination. Factor in the pathetic state of the other D-I men's basketball programs in Iowa, and you suddenly have the biggest group of bandwaggoning fans in Iowa history.

But not me. I'm focusing my attention on health care reform.

After the game.

It's Not Wellmark, Chester, It's You

Many Iowans are up in arms over a proposed health insurance increase from the dominant insurer in the state, Wellmark Blue Cross and Blue Shield. The average 18 percent increase in premiums would affect roughly 80,000 Iowans with individual policies.

One thing we've learned over the past 3 years is that when bad news comes knocking at Iowa's door, Governor Chester Chet Culver is going to lurch (not leap) into action. In this case he sent a letter to Insurance Commissioner Susan Voss, expressing concern about the increase, and asked Voss to hire an independent actuary to review Wellmark's proposed increase. Wellmark has agreed to delay the increase for 30 days. Yea.

Let me interpret: We are going to spend tax dollars on a study to do work that we already spend tax dollars for within the department of insurance. Genius! Is it no wonder that when he was introduced to the crowd at the boys state basketball tournament game I attended last week, he was lustily booed.

To be sure, there is plenty of bipartisan brow-furrowing at Wellmark, including by republican Senator Chuck 'Don't Turn Off the Switch on Grandma' Grassley, who accepts plenty of insurance PAC money. It's all an act, and no study or hissy fit it going to help. They know that health care is basically a zero sum game that doesn't work out for most people. 20% of insureds are going to soak up 80% of the costs, which means 80% of the insureds are paying premiums to subsidize the other 20%.

However, there are some things that politicians could do to lower costs, like pass tort reform. An even better one is setting an example by living a healthy lifestyle, eating right and exercising..... which brings me back to Iowa's overweight governor, not to mention its cigarette-smoking first lady.

Dear Mr. & Mrs. Culver: If you want to improve health care costs and make Iowa a better state, how about you living a healthier lifestyle and being an exemplar for the state? That will do far more good than wasting our tax dollars on reactionary politics for a study that is going to do no good whatsoever. If you want to see why health care costs are rising, you need a mirror, not a study.

The Nonprofit World

If you follow the news closely enough, you're bound to read almost weekly about a case of financial scandal and/or embezzlement. And if you're keeping track, it doesn't usually involve the Enrons of the world. While the national media gives notoriety only to the biggest, the reality is that 4 out of 5 times these scandals invlove nonprofit institutions.

According to a 2008 New York Times report by Stephanie Strom, fraud and embezzlement in the non-profit charitiable sector account for a loss of $40 billion a year. It's an eye-opening read at:
http://www.nytimes.com/2008/03/29/us/29fraud.html?_r=1&scp=1&sq=strom+light&st=nyt
Before I get back to that article, let me say that I worked at a not for profit organization for 12 years. It was not a charitable organization, but it still relied on the kindness of strangers ('members') to provide the operational compensation and infrastructure. These 'members' were not individuals, but rather other organizations that banded together in the name of sharing services. Those other organizations, of course, got their funding from either end-use customers and/or taxpayers.

While this sounds like a great money-saving idea, in practice it doesn't work so well. Whether it's a nonprofit charittable entity, or a not for profit trade association, or (egads!) a governemntal entity, it lacks two things that matter the most to successful organizations: Competition and oversight. Without competition, no one has any external motivation to be above average, and eventually the organization will be run based on jumping over the lowest bar possible.

But to get back to the New York Times report mentioned earlier, it's oversight that's the real problem. Even though I was directly involved in more than one annual audit each year as a benefits/finance director, I could identify many instances where the wrong person in the right place could have misappropriated or embezzled funds. Even if that didn't happen, on many occasions I witnessed our executive director allow member dues to be used for questionable expenditures. The best example was always sending him or his favorite friends/employees to resorts for all-expense-paid conferences at which no one had any business attending. The board of directors either wasn't told or didn't care about this, after all, they got to go to some of those conferences, too. Take my word for it, this happens frequently at nonprofit/govermental institutions.

I was reminded of this again over the weekend when a financial scandal was revealed at the Iowa Association of School Boards. It's a classic case of lack of oversight in one of the most non-competitive worlds out there, public schooling. And it makes me ill, because it's another waste of my tax dollars. (Follow the trail....I pay property taxes, which go to my school district, which uses them to pays dues to the Iowa Association of School Boards, which misappropriates them.)

Anyone living in central Iowa will also remember the CIETC scandal of a few years ago, when a state jobs training agency was exposed to have misspent millions in Iowa taxpayer dollars. At least people went to jail for that, although I don't recall getting my tax money refunded.

Let's all wake up and smell the coffee. We don't need better oversight of nonprofits/associations/governments - we simply feed fewer of them and the noncompetitive, non-oversight world in which they exist.

School Administrators Gone Wild

This week a Des Moines metro high school is in the news for suspending a student-athlete from activities, as outlined under their code of conduct, for being at a party where alcohol was present. But that's not why the school and student are in the news - they're in the news because the (ha-ha) parents of this (ha-ha) student-athlete won a court injunction to keep the kid playing in the state basketball tournament.

My take on this could go many directions. For instance, this being another example of how there are no bad kids, only bad parents. But this is actually a better example of a point I've tried to make for years, counter-intuitively, of how foolish it is for schools to try to have 24/7 authority over students.

There are very few high schools around Iowa, if any, that don't apply their code of conduct rules all day, every day, regardless of whether the conduct occurred at a school activity or not. This is one of the dumbest, non-academic decisions a school could make. It can't be uniformly enforced to begin with, and it's unfair to both kids and parents, good and bad.

Discipline is a 24/7 parent/guardian responsibility, not 24/7 a school responsibility. Just because some parents/guadians choose not to be responsible for their children, that does not give schools the default right to discipline them. Of course, I'm fine with schools getting into the act for those things that happen on school property or at school-sponsored functions. But outside of that, I don't want schools trying to parent my kids, thank you very much.....and I do not grant them permission to do so!

When exactly did it happen that schools decided to be the boss of me and my kids, all day and all night, 365 days a year? Because I want to get into a time machine to go back and club those responsible over their collective heads. Sorry, schools, but it's not your job, as much as you apparently want it to be.

I know nothing of whether the teenager in this particualar situation is a good egg or a bad seed, but it doesn't matter. Even though it might feel good and right to suspend this kid - there's no denying that he knew the rules and consequences - I reject the premise the rules should be in place to begin with.

In this case, as of this writing, true justice has prevailed.

Random 2010 Winter Olympics Thoughts

Vancouver looks like nice place to visit.

Lots of Winter Olympics events are just crazy, made up games. Aerial skiing? Snowboardcross?

The U.S. sucks at curling, but I am strangly mesmerized by watching it.

Bob Costas may be a real life Benjamin Button.

Cross-country skiers are some of the fittest people on earth.

Admit it - the Canadian national anthem lyrics and melody kicks the U.S. national anthem. We need to replace the Star-Spangled Banner with America The Beautiful if we want to compete with O Canada.

I would rather do almost anything than watch figure skating.

Paying People To Not Work

Consider the following:

People receiving extended unemployment insurance income
People receiving a 65% government insurance subsidy as unemployed in the past year
People participating in Iowa's new state worker early retirement incentive program

What do all these people have in common? I'M PAYING FOR THEM TO NOT WORK!

Consider the following:

People who were paid big bonuses from taxpayer-bailed-out financial institutions
People who bought cars that qualified for last year's 'cash for clunkers' program
People who bought houses that qualified for last year's home purchase tax credit

What to all these people have in common? I'M PAYING FOR THEIR NEW TOYS!

These are two very short lists - there are many other federal and state programs that transfer wealth via taxes from working stiffs to non-workers and/or people who don't need new toys. It's done in various hidden ways, through sales taxes, income taxes, tax credits, you name it, but make no mistake, I am paying taxes to make their lives better, and they are doing nothing for me or for the rest of society.

We aren't talking about people living on the street here either. We are talking about a lot of people with way more property and spare time than I may ever have. Sure, there are exceptions, but the so-called safety net is way to big.

What makes it even more infuriating is that some believe the answer to our economic ills is either higher taxes or more 'stimulus' spending. Look, I hate to admit it, but I believe the federal government did need to step in to bail out the financial fat cats in order to save us innocents. Now, however, it's time to stop giving people an incentive to not work, or to buy things they don't need.

I've said it before and I'll say it again: The government tax and spend monster doesn't need to be fed, it needs to be staved.

Tea Party No, Tax Reform Yes

It's becoming more common these days to hear outrage from people who are fed up with seeing their tax money go to bailouts and pork projects. While we didn't have much choice on some of the bailout, it was full of pork pet projects. This outrage is on balance a good thing. Governments have proven to be generally poor stewards of our money. I've said it before, if it doesn't establish justice, ensure domestic tranquility, provide for the common defense, promote the general welfare, or secure the blessings of liberty, we ought not be paying for it.

But all good outrage must have a kooky element, so enter the so-called Tea Party movement. This supposedly independent but factually right-leaning group is trying to gain traction as a meaningful political force. While I'm all for a viable third party, these folks are actually making me miss Ross Perot. Call me crazy, but if Dick 'Smoke 'em if you got 'em' Armey is one of your organizational leaders, you might not be independent. And if you invite Sarah 'I read all the papers' Palin to be the keynote speaker at your convention, you also might not be independent. Or even very smart.

If those misguided Tea Party souls want to direct their energy at something more independent and worthwhile, they should visit Iowa to watch Chet 'I need another cheeseburger' Culver tax and spend our state into ecomomic oblivion. Or for a more bipartisan target, how about our state board of regents raising tuition at the three public universities by 6%. 6%! Somebody please tell me what in this country, besides healthcare, is currently going up at a 6% clip? Or even half that?! Don't you think maybe, just maybe we've got too many tenured professors and administrators at these schools? Regardless, if it were a business in this economy, raising prices by 6%, it would be finished.

Ladies and gentlemen, it's time to say "No!" to the governments and their non-profit bretheren, which service the taxpayer like the boar services the sow. Our government combined with our political process is a mixture that simply does not work. We don't need a tea party to fix this, we just need to elect tax reformers that will give us a lower and preferably flat tax structure, and give government the liposuction it dearly needs.

The Cinderella Story

[standing in an ornamental flowerbed]
What an incredible Cinderella story! This unknown, comes out of nowhere, to lead the pack at Augusta. He's at the final hole. He's about 455 yards away, he's gonna hit about a 2-iron, I think...

[swings, pulverizes a flower]
Oh, he got all of that! The crowd is standing on its feet here at Augusta. The normally reserved crowd is going wild...for this young Cinderella who's come out of nowhere. He's got about 350 yards left, he's going to hit about a 5-iron, it looks like, don't you think? He's got a beautiful backswing...

[swings, pulverizes another flower]
That's...oh, he got all of that one! He's gotta be pleased with that! The crowd is just on its feet here. He's a Cinderella boy. Tears in his eyes, I guess, as he lines up this last shot. He's got about 195 yards left, and he's got a, looks like he's got about an 8-iron. This crowd has gone deadly silent... Cinderella story, out of nowhere, former greenskeeper, now about to become the Masters champion...

[swings, pulverizes yet another flower]
It looks like a mirac- it's in the hole! It's in the hole!

Brutal Vikings (Not The Nordic Kind)

If I made a list of the most difficult things to do in the world, it might include being the U.S. president, or climbing Mt. Everest. But near the very top of that list might be something you wouldn't expect: Being a die-hard Minnesota Vikings football fan.

After another year of emotional investment, the Vikings pulled the rug out from under their fans again by losing the 2010 NFC Championship game to the New Orleans Saints in a game the Vikes absolutely dominated. Turnovers begat another brutal loss in a lifetime of brutal losses.

So in a therapuetic attempt to feel better by talking/writing it out, I now give you my list of Top 5 most crushing losses in Vikings history:

1. 1999 NFC Championship game in OT at home versus the Altanta Falcons. This was the Gary Andersen only-missed-field-goal-of-the-year game. Vikes were the best team in the NFL that year hands down, and didn't even make the Super Bowl.

2. 1975 NFC playoff game at home versus the Dallas Cowboys. This was the original Hail Mary pass game. I was 11 years old, still optimistic about life, until this happened and I became forever scarred and cynical.

3. 2010 NFC Championship game in OT at New Orleans Saints. A lot like the 1999 game, but perhaps not quite as hideous since they were not favored to win. Still, the clearly better team lost, and it's brutal enough to make the top 3.

4. 2003 regular season finale game at Arizona Cardinals. Lost on 28-yard TD pass as time expired, after being up by 11 with less than two minutes to go. Knocked them out of division title and playoffs after being in first place the entire year. (And allowed the then-Brett Favre-led Green Bay Packers to go the the playoffs.)

5. 1988 NFC Championship game at Washington Redskins. This was the strike-shortened year, and the Vikes had the best 'regular' player record in the NFL going in (but had to play on the road because they were 0-3 using replacement players). Darrin Nelson flat-out dropped a short pass from Wade Wilson at the goal line late in the game to seal the loss.

These games, and many more, make being a Vikings fan one of the most difficult things to do in the world. So why continue?

It's a mystery of faith.

A Good Day For Marijuana

Dateline: Harrisburg, Pa. - New Jersey Gov. Jon Corzine on Monday (1/18/2010) signed a law legalizing medical marijuana for the chronically ill.

You can now officially add New Jersey to the list of far-too-few states that have removed their head from their butt and allowed medicinal marijuana.

I've previously blogged about legalizing pot altogether (http://streffblog.blogspot.com/2009/08/medicine-and-marijuana.html) so I won't go into that more universal argument here. Suffice it to say that it takes an incredible amount of backassward thinking for governments to allow other controlled substances (e.g. oxycontin) to be prescribed (and often abused) to treat illness and disease, but not a less potent one like marijuana that has proven to be effective in treating neuropathic pain.

Makes me want to have a stiff alcoholic drink, which of course is a mind-altering substance readily available to me even without a prescription!

The Conan Solution

For the record, I have always been a fan of Conan O'Brien, going back many years during his time on Late Night. Dude is funny, and "If They Mated" was one of the great comedy bits of all time. (Why did he not bring that to the Tonight Show? Was it someone else's intellectual property?)

I thought it was awesome when he took over the Tonight Show. Jay Leno was fine, but not edgy enough, and often boring. Oh, he had some funny stuff, including "Headlines" and "Jaywalking" but Conan is funnier, and superior at sketches, improvisation, and interviews.  People will get used to him, right.

So I think this whole NBC deal about giving Leno back the Tonight Show slot is crap. Leno agreed to leave years ago, then decided against it, so NBC created an earlier show for him, and that hasn't worked. Now NBC is basically canceling his show - so how is it they have to find him another place?

Look Jay, thanks for your years of service, but when a show gets canceled you don't automatically get another show, much less your old show back. It's time for you and NBC to bite the bullet and let Conan keep the Tonight Show at its regular time, if for no other reason than common decency. Conan's staff uprooted their lives and moved from New York to California to do this......for god's sake Leno, find another show yourself! Be stand up about it and fall on your sword!

As I write this, it doesn't look like that's going to happen, so here's the best alternative for Conan: Forget the Fox Network (too conservative, and not really a network per se) and go to Comedy Central to take the slot immediately following Daily Show and Colbert Report. I might never watch anything else for those two hours. Yeah, it'll be a much smaller audience, but a devoted one, and Conan go back to doing some things he did on Late Night that he's reluctant to do now.

It's a win/win. For me at least.

Ignore The Investment/Media Conspiracy

The New Year always brings predictions of what is to come. In the financial industry, regardless of the time of year, there are plenty of ‘experts’ willing to provide the media with opinions on the future direction of markets.

It is not often appreciated by investors, but there is a cozy relationship between the media and the traditional investing industry. In short, they both want you to believe that certain individuals have uncanny powers of foresight.

For stock and bond analysts, promoting this illusion of insight is helpful, because it justifies their fees and keeps people trading. For the media, the myth that certain remarkable individuals can reliably forecast market prices is helpful, because it provides endless "gee whiz" stories for the readers/viewers who keep the advertising revenue flowing.

The fact is, no matter how smart individual analysts may be, and no matter how much they know about the companies and sectors they follow, in the end they are hostage to unforeseen events. These might include changes in federal laws and regulations, or the discovery of a new technology that renders a previously innovative solution obsolete, or even a breakdown in an obscure area of the mortgage market that unleashes a global meltdown in the banking industry. (Sound familiar?)

The bad news is no one knows what the investment future will hold. The good news is you don't need to know in order to have a successful investment experience. You simply have to rely on a few fundamental principles:

It is impossible to identify superior investment managers in advance.
Capitalism breeds competition, and that makes markets difficult to beat. With millions of participants competing in capital markets, it is hard to identify in advance anyone who can systematically beat the market. Eliminate the risk of choosing the wrong manager by following a low cost, broadly diversified approach that does not rely on stock/bond picking or market timing.

Diversification is the only antidote for uncertainty.
Although diversification neither assures a profit nor guarantees against loss, a properly constructed and well-diversified portfolio is a key component of a successful investment experience. Portfolios should be designed to capture certain risks and eliminate others, depending on your preference and capacity for various types of risk.

There is no free lunch. Risk and return are related.
Much like a football player who chooses to play without a helmet, you should not expect to be paid more for taking risks that can easily be avoided. Higher expected returns only come from bearing more risk that cannot be diversified away. Focus on eliminating risks that you should not expect a reward for taking, such as concentrating your portfolio in just a few stocks.

Don't guess. Invest.
Rather than relying on speculation, blind faith, or anecdotal evidence, concentrate on what can be controlled: Managing the transactional costs of investing, reducing the impact of taxes, and taking a long-term view. Design portfolios that are cost effective, tax efficient, and disciplined.

Good investment management is not about media hype or making forecasts. Good investment management is about understanding and managing risk around an overall financial plan.