Taxpayer-Funded iPads For Everyone!

The following is both the truth, and a letter to the editor I sent to the Des Moines Register this weekend:

In a recent 5-1 vote, the Johnston School Board agreed to spend $1.4 million to purchase 1,600 iPads, enough for each high school student and teacher.

As a Johnston school district taxpayer, I say why stop there?  If the board thinks iPads are that important to learning, let’s increase property taxes so we can equip every middle and elementary school student and teacher with an iPad.

And if they’re really serious about this learning thing, let’s increase taxes even more so we can get an iPad in the hands every parent of every Johnston Community School District student.  After all, parents need help with their lifelong learning, too!

It sure is good to know our school board isn’t concerned about there not being one shred of evidence that student achievement is correlated to using an iPad, a technology that’s only two years old.  Only silly people without iPads probably think that way.

Buffett's Words Of Wisdom

On May 7, 2012, CNBC conducted a wide-ranging interview with legendary investor Warren Buffett.  Below are 5 brief excerpts from that interview.  (Glad to see he agrees with me!)

BUFFETT ON CASH:  “I think cash is probably as risky an asset as you can own over time.  You're not taking risk off when you go into cash.  You are going into something that is sure to decline in purchasing power over time.  So that is the biggest risk I know is to own cash.”

BUFFETT ON HYPE:  “Retail investors should not pay any attention to the day's news.  If they're paying attention to the day's news and they're trying to buy and sell stocks based on the day's news, they're never going to be successful investors.  The idea is to buy a good business.  I mean, it's the same way as if you went out to buy a business.  You'd look around for a company, some little business that had good prospects over time, had decent and honest management and where the price made sense.”

BUFFETT ON STOCKS:  “I think equities are very attractive for the long term.  And they may get more attractive next week or next month.  But it's the same thing I said in October of 2008.  I didn't know where bottoms were going to be or where they were going to be in a year.  But equities, good producing businesses are a great thing to own over time, and they will be a great thing to own for the next 100 years.  But who knows whether they go up or down in price next week.”

BUFFETT ON TRADING:  “I'm not a fan of active trading of any kind.  I don't know how to make money trading actively.  Maybe if I did, I wouldn't be so negative on it.  As to the volume, though, there's still way too much volume in the market.  I mean, the idea that the ownership of a company should turn over a hundred percent in a year, that is not the way people behave with apartment houses, it's not the way they behave with farmland.  But they have this notion in stocks that they ought to do something every day.  The best thing to do with stock is buy stock with a good company and don't look at the price for five years or something.”

BUFFETT ON WHAT TO BUY:  “The greatest asset to own is your own abilities. I mean, no matter what happens in the economy or with currency, if you develop your own talents – I tell the college students that the best thing to have is to develop your own talents.  The second best thing is to buy into other people's talents.  You know, here's Coca-Cola, and people are going to be drinking it 10 years or 50 years from now, and they're going to be drinking more of it, and they'll make more money.  So I don't have any idea what Coca-Cola stock is going to do next week or next month or next year, but I'm pretty darn sure where the company will be in 10 or 20 years.  And people beat themselves in the stock market.  The stock market, literally, in the 20th century, went from 66 on the Dow to 11,400.  And you'd said, `How could anybody not have a good experience?'  But millions of people don't because they get excited at the wrong time, and they get depressed at the wrong time.  So you've got to put your emotions aside, you've got to give up the idea that you can decide when to buy stocks and when to sell stocks.  The time to buy stocks is consistently over time.”

Dear Graduating Class of 2012

To High School Graduates of 2012:

Congratulations on what is probably the greatest accomplishment of your life so far. Now the bad news - it doesn't really matter.

If you are/were a slacker up to now, you probably feel like you got over, and in some sense that's true.  The thing of it is, you'd have to be a complete moron, or maybe a criminal, not to get a diploma with the sorry state of public schooling these days. Plus, now you're just going to continue being a slacker, so what did you really get over on? But thank you for your lack of effort anyway, because I'm always going to need people willing and only able to work in the service industry to take care of me.

If you are/were not a slacker up to now, good for you, it might have helped you get a college scholarship and made your family proud.  Unfortunately, as of this moment, you are no farther ahead in life than the slacker to which I just referred.  All that work took you to the same piece of paper that the lazy students got.  Sucks, doesn't it? The good news is, you have a better future ahead, and from here you are going to very quickly improve your chances of future prosperity over the slacker.

To College Graduates of 2012:

Congratulations on what is probably the greatest accomplishment of your life so far. Now the bad news - it's time to grow up.

What the hell is the matter with your generation?  Not so long ago, going to college meant you had four years to develop a certain set of intellectual skills, and upon your graduation you already had a job and/or post-graduate school lined up to begin a couple of weeks later.  Now more often than not, you take more than four years to get an undergraduate degree, and you have a 'now what?' look on your face as you walk across the stage, and you move back home.

Gimme a break.  What were you doing during your last year of college?  You had tons of time to complete or apply for internships, and interview for and land an actual job.  I don't know you, but I know the probability is high that you didn't put a whole lot of time into it.

And don't give me the old 'tough job market' excuses.  I know, I know, the Great Recession is making it tough on college graduates - that doesn't mean you shouldn't try.  It means you need to try harder.

Also, try expanding your job horizons already.  It's a big country out there, you don't need to limit your search to the city/state in which you grew up.  This may come as a surprise to you, but that was kind of part of going to college, realizing it's a big world of other people and opportunities out there.

I don't entirely blame you.  I also blame your parents.  Apparently, they want you to have an option that they didn't have, meaning moving back home and allowing you to indefinitely leech off of them.  Fortunately for you, my generation has decided they would rather be your adult friends instead of being your parents.

It's hard not to take advantage of this invitation to slacker-ville, no doubt.  Just be accountable, OK?  If you have a new degree but no job, it's probably your fault.  Your parents want you succeed, and they may give you a place to avoid the big, bad world for a while, but don't get used to taking advantage of it.

Which brings me to my quick and opposite advice:  It's a big, bad world out there. Get used to it.

Berky Meeting Nuggets 2012

Just made my annual trek to Omaha to attend the Berkshire Hathaway annual shareholders meeting.  It may sound crazy, listening to Warren Buffett and Charlie Munger answer questions for five hours, but for me it's a philosophical tune-up not only from an investment perspective, but also from an economic, political, intellectual, and social standpoint.

Similar to last year, here's a summary of what I consider a few highlights of this year's meeting:

On the company movie and celebrity sightings:  Board member Bill Gates was there, as was U2 lead singer Bono.  The movie included skits with Jimmy Buffett and the cast of Glee.

On Buffett's health:  Buffett said he feels terrific.  Munger jokingly (as usual) said he resents all of the attention Buffett has been getting after his recent Stage 1 prostate cancer diagnosis - Munger claimed he probably has as much prostate cancer, he just never gets tested for it!

On energy:  While natural gas prices are at historically now levels due to increased supply, Munger said it was idiotic to be extracting so much of that finite resource from the earth.  He said we should be using other sources that were more abundant.  He also said the energy independence is one of the stupidest things he'd ever heard of - we should be importing and using up other countries' resources and keeping ours as a reserve.  Had we adopted this philosophy decades ago we'd be a lot better off now.

On SuperPACs:  Buffett noted he could probably advance his political causes through SuperPAC donations, but he would never do that.  Both he and Munger agreed the Citizens United ruling was bad for the country, allowing a few wealthy folks to have undo influence.  And Buffett flat-out said he didn't want to see democracy go in that direction.

On the so-called Buffett Rule on taxing the very rich:  Buffett reminded everyone he proposal isn't an attempt to balance the budget, but simple a matter of tax fairness to make sure lower income people don't pay a rate higher than the rich.  He said the 400 highest income people in the U.S. averaged $250 million per year, and of those, 140 or so paid taxes of 15% or less.  So the Buffett Rule wouldn't even impact most of the super-rich, and those it would impact would be just fine.  And yes, it would also raise a few billion per year of tax revenue.

On the so-called Buffett Rule #2:  A question from a shareholder's claims his 84-year old father would invest in Berky if it were not for Buffett's tax philosophy. Among other things, Buffett said it sounded like the guy ought to invest in Fox!