I'm running for President

 

I’ve got the brains, you've got the looks

Let's make lots of money

You’ve got the brawn, I've got the brains

Let's make lots of money

                        Pet Shop Boys 1985         

          This would be my first speech if I was running for President, had $100 million, and had some Blue Label 5 minutes before:

"Hi, my name is Kitt Domney, and today I am announcing that I am officially a candidate for President.  The main thing I want you to know about me is that I am rich.  Filthy, freakin’ rich.  So rich, in fact, that to be honest I've lost track of exactly how much money I have.  Now once upon a time in America, this was considered a good thing.  People who were rich were looked up to.  They were understandably thought of as smart, hard-working, and ambitious.  Let's face it, the American dream was mainly about money; having a big house, nice car, and something left over for the toys.  The rich were respected because everyone was trying to get to where they were, and we all looked up to the people who made it.

And then it all changed.  I can't really pinpoint a time when it happened, and I can't point to one event that caused it.  Maybe it was America electing a President who never missed the opportunity to tell you that the rich were screwing the poor.  Maybe it was the development of a welfare society in which most people didn’t have a stake in the functioning of the country, as 50% of people don't pay one penny in taxes (candidate takes a three-minute break to go vomit after thinking about that).  Okay, I’m back, sorry about that.

            Whatever it was, the rich went from being respected to being hated.  Jealousy started running wild.  Now this all seemed strange to me, because like always I noticed that people were still trying to make more money.  Employees kept asking their bosses for raises.  People continued to uproot their families and fly across the country for higher paying jobs.  People sure seemed happy when they won the lottery.  I could be wrong, but I don't remember anyone having their picture taken when they picked up their unemployment check.

Everyone still wanted to get rich. But the few who were successful were looked down on by those same people.  It turned into a bizarro world.  Well friends, I'm here to straighten things out.  Our country is broke and I know how to fix it.  I understand finance, which is how I got so rich in the first place.  I've hired thousands of people and supported thousands of families.

Look folks, I'm not your friend, I’m not your pal.  We’re not going to be drinking buddies.  I got a job to do, and I need you to let me do it.  Just like you don't need to be best friends with your doctor or  accountant, you don't need to be best friends with me.   But you’re going to love me when I turn this country around.  And one day you might even look up again to people who are living the American dream."

Have a good night everyone.

 JR

The Death of Joe Paterno

Joe Paterno died yesterday, and my immediate reaction was happiness.  As I’m usually not in the habit of wishing death on people, at first I thought this was simply a visceral reaction, like an immature teenager that gets angry.  So I thought a little more about it, and a little more, and my conclusion: I'm glad he's dead.

I don't give a damn that the man was a good football coach.  I don't give a damn that the man graduated most of his athletes.  To me that is far outweighed by the fact that due to his actions little boys were raped.  I won't rehash the whole story, since you probably know most of it.  Basically Paterno was told in 2002 that his former assistant, Jerry Sandusky, had raped a 10-year-old boy in a shower.  He did not go to the police.  The most powerful man at Penn State told his athletic director and washed his hands clean of it.  He didn't didn't even tell the director all the specifics of what had been reported to him.  The abuse of that boy, and at least 1 other, continued.

            After the Penn State story broke, the majority of articles portrayed this as an example of college football programs becoming too powerful, and creating an atmosphere of being above the law. This was not about that.  It was about the rape of little boys.  It was about pure evil.  The US Centers for Disease Control and Prevention estimates that 1 in 6 boys and 1 in 4 girls are sexually abused before the age of 18.  It can happen anywhere pedophiles can get young boys and girls alone.

Maybe I'm overly sensitive to this issue because I have a flock of boys myself at home.  Or maybe it's because I know that those kids will never be the same.  Ever.  To take children, who are taught to be well behaved and respect adults, and then to have one of those adults use that trust against them to abuse them...I can't think of any worse crime.  I really can’t.  Even writing this blog is making me angry.

I vaguely remember the Gamara saying that we should not wish for the death of another, but for the evil to depart from them.  Maybe I'm just not yet at that spiritual level.  All I know is that Joe Paterno could have stopped young boys from being raped, and he didn’t.  That's his legacy.  I'm happy he’s dead.

          JR

Life without Commercials

The world crashes in, into my living room

Television man I've got what you need

We are still good friends I know the way you are

Television man I know what you're tryin’ to be

Watchin’ everything and I gotta say

That's how the story ends.

            Talking Heads 1985

I have not watched a commercial in about three years.  This hit me recently when a friend made a joke based on a current commercial, and I gave him a blank stare.  I hadn’t thought about it before, but I have now, and I have 2 thoughts.

First, isn't this great? In my never ending fascination of how electronic inventions have made my life better, the DVR (in my case Tivo) is definitely one of the best.  I cannot imagine wasting another minute at any point in my life watching someone try to manipulate me into buying something.  At the same time, I'm a little sad when I think about how much time was wasted watching commercials before, all because I was born a few years too early.

You can now knock out an NBA game in about an hour, and an NFL game in about 1:15.  In a typical 44 minute Sunday morning news show, there may be about 30 minutes that I really have an interest in.  You can now just skip that part; no more waiting around nibbling on the broccoli to get to the red meat.  I can't think of the last time I actually watched a show at the regularly scheduled time.  Also, no more running to the refrigerator like Usain Bolt to grab something by the end of the commercial.

My second thought is: are commercials going to disappear? It's too easy to fast forward past them now, and I know I'm not the only one doing it.  The advertisers will eventually notice that the ratings will no longer equate with big sales.  It's hard to sell product no one knows about.  If I had to guess I would say that commercials in their current form will end within 4-5 years, but I'm not as confident about it as books disappearing (I think I spiked that prediction, by the way.  I recently read that e-book sales doubled year-over-year and now make up more than 20% of the market). 

            From a professional standpoint, I'm not exactly thrilled with a universe with no TV ads, as I get quite a bit of business from them.  But from a consumer standpoint, life without commercials is much more entertaining and efficient.

Have a good night everyone.

JR

Golden Gamble II

And so we’re told this is the golden age

And gold is the reason for the wars we wage

Though I want to be with you be with you night and day

Nothing changes on New Year's Day

                        U2 1983

Tonight I want to talk about some of the myths regarding gold.  The name of this blog is Golden Gamble II.  It narrowly beat out the name “Topic so boring to most people that no one will read it”.  You can read Golden Gamble I, about my decision to bet everything on gold, here.

The first myth about gold is that it does better when there is chaos in the world, and vice versa.  In other words, it's thought of as a safe haven against disasters.  This is garbage.  Whenever there is some shocking, negative headline, such as tsunamis, wars, or political assassinations, the mainstream media acts shocked when the price of gold stays the same or goes down.  This happens constantly; so much so that it’s shocking that they’re constantly shocked.  If the price of gold goes up after one of these disasters they of course attribute it to the catastrophe. 

Look, we're never going to get an end of the year wrap up that goes something like this:  “2011 was a great year. We had no civil wars, no sectarian violence, and no dictators attacking their own citizens.  Also, there were no tornadoes, earthquakes, or landslides.  In politics, everyone got along beautifully.”   Unfortunately, catastrophes happen every year.  The only surprising thing would be if they didn't.  The price of gold has virtually nothing to do with them.  The main drivers for the price, as discussed here, are currency debasement, inflation, and a lack of attractive alternative investments.  Shock and awe ain't one of them.

The next myth is that all gold bugs think civilization is coming to an end, and all of us will soon be living in the outdoors with the only things to protect us being guns and gold.  Actually, some people do think like this.  I've spoken with one or two.  They're highly entertaining.  For hard core gold bugs, gold is almost a religion, with their belief in the value of gold constant in all times.  The truth is, however, that for most people ownership of gold is simply an investment like any other.  It's just the proper play right now.  If we strengthen the dollar and crush inflation, I will be all out of gold as fast is I was all in, with the click of a mouse.

The third myth is that gold acts as insurance, so that all portfolios should have 5% to 10% of their money in gold at all times.  Wait, what?  I may do a blog about financial advisors, and it's not going to be pretty.  These type of mantras, repeated constantly without any thought or understanding as to the fundamentals, are what get people killed.  If the fundamentals of gold are good, you need to have as much in your portfolio as you would for any investment that you think is going up.  If they are poor, don't have a penny in it.

My next blog, which will be my last one about gold for a while, will be about predictions for the future.  I'm either going to call it Golden Gamble III or “Killin’ it in 12”.

Have a good night everyone.

JR

Republican Prediction

The waiting is the hardest part

Every day you see one more card

You take it on faith, you take it to heart

The waiting is the hardest part

                        Tom Petty 1981

Since the Iowa caucus is tomorrow night, which signifies the start of the voting for the Republican Presidential nominee, I thought we would interrupt our regularly scheduled gold program and do a quick blog to handicap the field.   This has been far and away the most entertaining race and group of candidates that I've ever seen.  After the never ending string of debates, we’re finally ready to roll.  For the record, I'm an independent with libertarian tendencies.  Not that there's anything wrong with that.

Michele Bachmann– A consistent social conservative, she's articulate and smart.  However, after an initial rise in the polls she has not been able to connect with Republican voters.  I think she's going to be one of the first to have to drop out of the race.  Odds of winning the nomination – none.

Rick Santorum – Ditto for what I said about Michele Bachmann. The difference is he is peaking at the right time, and many pundits expect him to win Iowa.  However, I think this is due to the high concentration of evangelicals that will be voting there, and I don't expect his support to be broad-based in the rest of the country.  He may stay in the race a little bit longer because he now has the mo, but I can't see him going the distance. Odds of winning the nomination – slim.

Rick Perry – watching Rick Perry at the debates was like writing a review for a movie: “It made me laugh, it made me cry…” This guy makes Bush look like a genius.  However, he was smart enough to create pro-business conditions in Texas, and his record on job creation is better than anyone else's.  I keep hearing how much money his organization has, so he can keep running ads and will probably stay in the race a little longer.  But after those debates it’s not going to happen.  Odds of winning the nomination - slim to none, but guys named Slim usually aren't intelligent either.

John Huntsman - I like him.  He did an excellent job as governor of Utah, and was the ambassador to China.  Check out some YouTube clips of him speaking fluent Mandarin Chinese.  He's highly intelligent, but so far has been almost completely ignored by Republican voters.  He picked a bad year to run; the Tea Party/right wing of the party grabbed hold of it this time around.  He’s too liberal for their taste, like when he committed the mortal sin of acknowledging that global warming is real.  I'd like to see him run as a third-party candidate, but that would probably hand the election to Obama.  Odds of winning the nomination - slim, but if he breaks out in New Hampshire anything could happen.

Newt Gingrich – I always form an opinion as to whether I think a candidate would make a good President.  He's the only one I can remember that I have absolutely no idea.  He's completely unpredictable, a walking contradiction.  He’s brilliant, but has flip-flopped on so many issues that it wears you out.  When he was Speaker of the House of Representatives he was a hothead who was disliked by many in his own party, but now he’s trying to reinvent himself as the calm elder statesman who is above the infighting.  As his poll numbers have dropped due to all the negative ads against him, expect him to return to the feisty Newt.  He's the best debater of any politician in my lifetime, and I would love to see him debate Obama.  But man does this guy have a lot of baggage.  Odds of winning the nomination – decent.

Ron Paul - The most fascinating politician that I've ever seen.  I’m going to do a few blogs just about him, and since he’s going to stay in the race until the very end I've got plenty of time.  I'll keep it short here:  He’s a principled man with 100% consistent libertarian and Constitutional values.  Unfortunately, the one major issue that I partially disagree with him on, Israel, is of the utmost importance to me.  Four years ago when he ran he was laughed at, but always had a fanatical 10% following.  Now he's got a fanatical 20% to 25%, and no one's laughing.  The country is starting to move towards his views.  Don’t be shocked if he runs as a 3^rd party candidate; freedom resonates with Democrats too.  Odds of winning the nomination - decent.

Mitt Romney - I think he will win.  At the end of the day, expect him to be the last man standing.  He's an articulate and strong debater, but for some reason has had difficulty conveying the fact that he's been a success at everything he’s done; multimillionaire businessman, governor of Massachusetts, head of the Olympics.  I actually think he would make a fairly good President.  If he gets the nomination he can unchain the Tea Party shackles and slide over to his center/right leanings, which is where the country is.  Odds of winning the nomination – strong.

Have a good night everyone.

 JR