Well Said...

"If you wish to be a success in this life you must first be a good animal."

~ Herbert Spencer

Herbert Spencer (1802-1903)

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The Windy City is Bustling

I flew into Chicago last night -- the "windy city" is alive and well -- bustling as a matter of fact...

Hyatt Regency, Rosemont, Illinois

All Americans Should Answer This Question...

Please share this poll with your friends and colleagues using the link below, thanks...

The Good Life Comes in Moments...

I took this photo of the sky above my home earlier today -- staring at the sky in wonderment reminds me of all good things -- the good life comes in moments...

The clouds above my home earlier today [click to enlarge]

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Advanced Risk Analysis Modeling for Excel

Announcing...

ModelRisk 4.0

Advanced RISK ANALYSIS MODELING for Excel

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What is a Deipnosophist?

deipnosophist

n

(Literature / Rhetoric) Rare a person who is a master of dinner-table conversation

[from Greek deipnosophistai, title of a Greek work by Athenaeus (3rd century), describing learned discussions at a banquet, from deipnon meal + sophistai wise men; see sophist]

Source: The Free Dictionary

What is the Foehn?

foehn, also föhn
n.
A warm dry wind coming off the lee slopes of a mountain range, especially off the northern slopes of the Alps.

View from the Zugspitz, Germany [click to expand]

I learned about the foehn while living in the German Alps years ago -- many Europeans believe the foehn brings mystical qualities. According to one source:

In certain regions of the world, the seasonal winds that blow have become legendary, bringing little short of misery and chaos to many of the local inhabitants. In these places it has been known for generations, that the winds bring feelings of anxiety, stress, depression and sleepless nights. Statistical studies show that when these winds appear, more road accidents happen and suicide rates increase. So real is the problem that it has been known for judges to take this into consideration when sentencing and for hospitals to postpone some operations until they cease!

You might ask why am I writing about the foehn. Well, the foehn is blowing through my town in the Allegheny Mountains of Pennsylvania as I type this tonight, and the feeling is eerie...

Sources:

D J Clarke

The Free Dictionary

What is Private Equity?

private equity

Collective term for equities that are not listed on an official or public market.

Source: AP3: Third Swedish National Pension Fund

Silver Comes Into Vogue

The 1964 Kennedy half-dollar has a nominal value of $0.50, however the coin has a market value today of roughly $18.70, given its 90% silver content. Assuming a person had acquired this coin in 1964 at its nominal value, and then sold the coin today at market value, the realized annual rate of return would be approximately 8% (N = 47, PV = -0.50, FV = 18.70).

An 8% annual rate of return is certainly better than current savings rates...

Well Said...

"I have the same goal I've had ever since I was a girl. I want to rule the world."

~ Madonna

Madonna Louise Ciccone (1958- )

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Majority of Americans Support Raising Taxes on Incomes over $250,000

A new Washington Post-ABC News poll finds that a strong majority (78%) of Amercians oppose cutting Medicare. Moreover, a majority (56%) of Americans polled oppose cutting military spending. Conversely, a significant majority (72%) of Americans apparently support raising taxes on incomes over $250,000.

Medicare and military spending are apparently popular programs amongst Americans, while raising taxes for those earning over $250,000 appears acceptable, at least according to this poll.

Source: Cohen, J & Balz, D (2011, April 20), Poll Shows Americans Oppose Entitlement Cuts to Deal With Debt Problem, Washington Post.

Populist Majority versus True Majority in America

According to Treasury Sec Timothy Geithner, the US would have to implement drastic fiscal cuts should Congress precipitate a Federal default by not increasing the US debt ceiling by July 8, 2011. In Geithner's words:

If Congress failed to increase the debt limit, a broad range of government payments would have to be stopped, limited or delayed, including military salaries and retirement benefits, Social Security and Medicare payments, interest on the debt, unemployment benefits and tax refunds.

Of course, most Americans receive not a penny from any of these government spending programs, which means only a minority of Americans would suffer directly from the cuts Sec Geithner says would be necessary.

Here is my question: Is the populist majority in America, which enjoys the lion's share of government entitlements, heading for a political collision with a true majority of the nation's voters who could care less about government entitlements at this point?

Source: Indiviglio, D (2011, April 22), Will the US Really Default in May if the Debt Ceiling Isn't Raised? Atlantic.

Happy Easter

Here is a quick and easy Excel VBA (Microsoft) user-defined function for determining the calendar date upon which Easter falls during any given year.

Public Function EasterDate(Yr As Integer) As Date
   Dim d As Integer
   d = (((255 - 11 * (Yr Mod 19)) - 21) Mod 30) + 21
   EasterDate = DateSerial(Yr, 3, 1) + d + (d > 48) + 6 - ((Yr + Yr \ 4 + d + (d > 48) + 1) Mod 7)
End Function

To find the date for Good Friday during any specific year, save the above code in your Excel VBA editor and then enter the function in an Excel worksheet. For example, =EasterDate(2011) returns 40657 which converts to 4/24/2011 when the cell is formated for dates. Likewise, =EasterDate(2011)-2 returns the date for Good Friday as 4/22/2011 (as in today).

Happy Easter!

ModelRisk 4.0 Leads the Field

My preferred business intelligence and risk analytics platform is built around Excel (Microsoft) extended by ModelRisk Industrial (Vose), the most advanced spreadsheet-based risk modeling solution ever developed. ModelRisk adds critical functionality to Excel, including Monte Carlo (probabilistic) simulation, sensitivity analysis, object-modeling, multivariate correlation and forecasting, global optimization, expert elicitation tools, Bayesian averaging for fitted models, interpolation and distribution splicing, and more. Follow the link below to learn more about ModelRisk 4.0, including the new Standard Edition available for free download:

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College Town Perks in the US

Living in a college town has perks! See what various college towns in the US have to offer by following the link below:

[click image for more]

Source: Marcus, J (2011, April 15), 30 Perks of Living in a College Town, Boston Globe.

What is Austerity?

austerity
n pl -ties
1. the state or quality of being austere
2. (often plural) an austere habit, practice, or act
3. (Economics)
a. reduced availability of luxuries and consumer goods, esp when brought about by government policy
b. (as modifier) an austerity budget

Photo: Howard McWilliam

Americans should remember that "austerity" means reducing our standard of living right now, especially for working parents and their children...

Sources:

Free Dictionary

Murray-West, R (2010, May 10), Prepare for the Age of Austerity, Telegraph.

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Walter Breuning (1896-2011)

Thank you Walter, for your words of wisdom -- requiescat in pace...

Well Said...

"Everyone has the will to win -- champions have the will to prepare."

~ Roy Williams

Coach Roy Allen Williams (1950- )

Wall Street and the Financial Crisis

Mandatory reading for financial economists and others interested in learning more about the events and circumstances that lead to America's worst financial crisis since the Great Depression.

Download

Ways to Prepare for Economic Depression

Here are some ways that ordinary people can prepare themselves and their families for economic depression:

• Convert knowledge and experiences into basic skills.
• Eliminate indebtedness.
• Stockpile food, water, and medications.
• Avoid marriage or divorce until prosperity returns.
• Avoid adding children until prosperity returns.
• Start a garden.
• Use public transportation.
• Expand your circle of friends.

I weep for those suffering economic hardship in America today, even if what we are experiencing is only a "recession"...

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Making Software Fun to Learn

Remember the days when learning to program and using software was fun? The logo below speaks volumes about what I am asking:

Beagle Bros software was produced for the Apple II line of computers back in the 1980's. The Beagle Bros catalog included a wide variety of comical software programs, utilities, and code snippets that appealed to both expert programmers and hobbyists alike. What made Beagle Bros unique was that their software was fun! The eventual replacement of the venerable Apple II with mightier machines eventually lead to the sunset of Beagle Bros as a software publishing firm. However, the Beagle Bros spirit and legacy lives on within many of us "old-timers" who learned to program while having fun on our Apple II computers back when desktops were still new.

These days, I make my living with Microsoft software solutions, which are generally a bore to learn and use. Thinking back, I miss the fun I had 30-years ago learning to program on my Apple II, including Beagle Bros software.

Follow the link below to learn more about the Beagle Bros legacy and contributions to desktop computing:

Beagle Bros Software Repository

PS: Microsoft should consider releasing a "fun version" of Visual Studio, if only for hobbyists...

US Per Capita GDP in Ounces of Gold 1929-2010

In 1929, the per capita Gross Domestic Product (GDP) in the US was approximately 40 troy ounces of gold. Ironically, the per capita GDP in America in 2010 was again, 40 troy ounces of gold.

[click to enlarge]

According to Investopedia:

The gross domestic product (GDP) is one of the primary indicators of a country's economic performance. It is calculated by either adding up everyone's income during the period or by adding the value of all final goods and services produced in the country during the year. Per capita GDP is sometimes used as an indicator of standard of living as well, with higher per capita GDP being interpreted as having a higher standard of living.

Source: Investopedia

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The Economics Edge

I recently read the following tidbit of interest to economics majors:

Economics isn't a popular major: Just 1.6 percent of [college] grads earned a degree in the discipline in 2006. But according to a 2010 study by Patricia M Flynn and Michael A Quinn of Bentley University, economics majors are disproportionately overrepresented among S&P 500 CEO's -- which suggests that, historically at least, it's the major that offers the best probability of reaching the corner office. Business administration majors, for instance, were only 39 percent as likely as economics majors to become chief executive. (McGinn, 2010, p. 20)

Apparently, economics majors enjoy an edge in the workplace, which is good to hear!

Source: McGinn, D (2010, December), The Economics Edge, US Airways Magazine, 20.

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What is Money?

Last month, Gov Gary Herbert of Utah signed legislation that makes gold and silver coinage issued by the US Treasury an alternative form of "legal tender" for Utahns (Riley, 2011). Other states are considering similar legislation, including South Carolina, Virginia and New Hampshire (Benko, 2011). Hence, Americans may soon be holding and spending multiple forms of money by necessity, especially if inflation benights the value of Federal Reserve Notes globally. In the coming years, society could see all of the following forms of money in cash register drawers.

The question of "what is money" is likely to become more than a rhetorical muse in the coming years...

Sources:

Riley, C (2011, March 29), Utah: Forget Dollars. How About Gold? CNN Money.

Benko, R (2011, March 2), Gold and Silver: The States' New Currency? Christian Science Monitor.

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Well Said...

"The deepest problems of modern life flow from the attempt of the individual to maintain the independence and individuality of his existence against the sovereign powers of society, against the weight of the historical heritage and the external culture and technique of life."

~ Georg Simmel

Dr Georg Simmel (1858-1918)

Silver to Gold Ratio at 36:1

At today's market closing, the asking price of gold was $1,476.40/oz, while silver stood at $41.00/oz. This means that one can exchange 36 American Silver Eagle coins for an American Gold Eagle on the open market.

American Gold Eagle and Silver Eagle coins have face values of $50 and $1, respectively, which implies that the ratio of silver to gold is fixed at 50:1. However, face values have nothing to do with market value, which is based on consumer demand. The silver to gold ratio since 1973 has averaged approximately 55:1, which is much wider than the current 36:1 ratio between the precious metals.

The current 36:1 ratio between silver and gold is the narrowest we have seen since the mid-1980's. This narrowing ratio between silver and gold prices shows that silver's value relative to gold has increased, which is an historical indication that the metals' rally may be reaching its peak. In the mean time, we could see silver prices rise even more given the eratic growth of today's global economy.

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Well Said...

"As every thread of gold is valuable, so is every moment of time."

~ John Mason

Silver Nears $40/oz

For years, silver hovered at around $5/oz. However, with gold now approaching $1,500/oz, silver is in play as well nearing $40/oz. Historically, gold has traded at between 16-50 times silver prices, which suggests that we could soon see silver climbing even more. Follow the link below to learn more about how silver is bought and sold in America.

Learn More

PS: My private practice gladly accepts payment in gold and silver coin for services rendered...

Top California Highway Patrol Salaries

The Sacramento Bee publishes a searchable database that lists the salaries for public servants in California, including salaries for California Highway Patrol officers. Below is an extract from a search I conducted. Apparently, California Highway Patrol officers can earn well over $250,000 annually. See for yourself below:

[click to expand]

No wonder California is bankrupt. For that matter, no wonder governments in general are broke...

Source: Search for State Worker Salaries, (2011, April 6), Sacramento Bee.

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What is Seigniorage?

seigniorage
n
1. something claimed by a sovereign or superior as a prerogative, right, or due
2. a fee payable to a government for coining bullion
3. the difference in value between the cost of bullion and the face value of the coin made from it

Source: The Free Dictionary

Bankers Lose Mortgage Paperwork

Geithner on Default

What follows is Congressional testimony by Treasury Sec Tim Geithner regarding his views on Federal default:

Default by the United States would precipitate a crisis worse than the one we just went through. I think it would make the crisis we went through look modest in comparison. It would force us of course to cut critical payments to our seniors and it would be a reckless, irresponsible act to this country. I find it inconceivable that the Congress would not act to increase the limit.

It would be catastrophic. I mean, if you call into question the willingness of the government of the United States to meet its obligations, you will shake the basic foundation of the entire global financial system. It is inconceivable that America would do that. And of course I am totally confident that Congress will act to avoid that.

It will raise dramatically the borrowing costs permanently for all Americans. Every business for a very long period time would face a much higher cost of borrowing. Every family would face a much higher cost of borrowing. Unemployment would rise dramatically. Thousands if not hundreds of thousands of businesses would fail. And of course you would shake the confidence of the world in U.S. financial assets and Treasuries. It would be a deeply irresponsible act, again inconceivable.

Clearly, Tim Geithner is not in favor of a national default -- that leaves austerity measures (as in spending cuts and tax increases) and monetary expansion (as in inflation) as the only remaining courses of action for fiscal policy-makers. The future of Federalism hangs in the balance...

Source: Geithner: Raise Debt Ceiling or Risk Another Financial Crisis (2011, April 5), Martinsville Media.

PS: I suppose the US could instead "eat" its way out of this economic crisis by building new businesses that can compete in the global marketplace, but that's just a suggestion...

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US Manufacturing versus Government Employment 1939-2011

The chart below speaks volumes about the state of the US economy:

Source: Bureau of Labor Statistics (BLS)

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The Declining Number of US Business Establishments

A troubling trend in the US economy has been the apparent decline in the number of business establishments. According to the Bureau of Labor Statistics, the number of businesses in the US declined from 8,814,254 in 2008 to 8,746,332 in 2010 (as of third quarter). Prior to 2008, the growth in the number of business establishments in the US had been growing at a healthy rate of 1.4% to 2.4% annually. Also note that fewer than 0.01% (a tenth of one percent) of the total number of establishments in the US employ more than 1,000 people. Thus, the decline in total business units in the US is a proxy measure for the decline in small to medium-sized business establishments overall.

Perhaps the US should be concentrating its efforts on ways to create new business establishments that hire, rather than focusing on how to create individual jobs per se...

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Merlot: A Multimedia Educational Resource for Learning and Online Teaching

Introducing Merlot, a multimedia educational resource for learning and online teaching that will appeal to almost everyone associated with higher education. The stated goal of Merlot is "to improve the effectiveness of teaching and learning by increasing the quantity and quality of peer reviewed online learning materials that can be easily incorporated into faculty designed courses."

According to the Merlot website:

Merlot is a free and open online community of resources designed primarily for faculty, staff and students of higher education from around the world to share their learning materials and pedagogy. Merlot is a leading edge, user-centered, collection of peer reviewed higher education, online learning materials, catalogued by registered members and a set of faculty development support services.

In particular, I commend the Learning Materials available on the Merlot website, which includes over 27,000 resources supporting virtually every academic discipline in higher education. All content on the Merlot website is licensed for open-source access under Creative Commons, which means that Merlot's resource materials can be used freely by most educators. Merlot is also a place to find and meet new colleagues in every academic discipline.

Follow the link below to learn more about Merlot. Membership is free.

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Scientific Propaganda in California

On Suffering...

The Weeping Buddha (Personal Collection)

The Way of Ignorance

Society's knowledge of the world and universe continues to advance exponentially. Nevertheless, we the people are at greater risk today than perhaps at any other time in our existence. The reason that society is at such risk is our inability, or perhaps our unwillingness, to harness new knowledge exclusively for the betterment of humanity. The following quote by Wendell Berry sums up society's knowledge problems perfectly:

Ignorance, arrogance, narrowness of mind, incomplete konwledge, and counterfeit knowledge are of concern to us because they are dangerous, they cause destruction. When united with great power, they cause great destruction. They have caused far too much destruction already, too often of irreplaceable things. Now, reasonably enough, we are asking if it is possible, if it is even thinkable, that the destruction can be stopped. To some people's surprise, we are again backed up against the fact that knowledge is not in any simple way good. We have often been a destructive species, we are more destructive now than we have ever been, and this, in perfect accordance with ancient warnings, is because of our ignorant and arrogant use of knowledge. (Berry, 2005, p. 59)

I sometimes wonder about just how far astray our society's ignorant ways might lead us...

Source: Berry, W (2005), The Way of Ignorance and Other Essays, Berkeley, CA: Counterpoint.

US Employment to Population Ratio Continues to Disappoint

The latest employment data from the Bureau of Labor Statistics (BLS) shows that the US employment to population ratio* stood at 58.1% for March 2011, up from 57.8% the previous month, but down slightly from 58.2% a year ago. The US employment to population ratio has been trending downwards since 2000.

Many economists believe that reporting the number employed as a percentage of the civilian population provides a more accurate description of the current state of employment than conjecturing the number of "unemployed" in a population. The US employment to population ratio reached a historical peak of 64.4% on an annual basis in 2000.

*The BLS defines employment and population (civilian noninstitutional) as follows:

Employment consists of all persons who, during the reference week (the calendar week including the twelfth day of the month), (a) did any work at all (at least 1 hour) as paid employees, worked in their own business or profession or on their own farm, or worked 15 hours or more as unpaid workers in an enterprise operated by a member of the family, or (b) were not working but had jobs or businesses from which they were temporarily absent because of vacation, illness, bad weather, childcare problems, maternity or paternity leave, labor-management dispute, job training, or other family or personal reasons, whether or not they were paid for the time off or were seeking other jobs.... The civilian noninstitutional population consists of persons 16 years of age and older residing in the 50 States and the District of Columbia who are not inmates of institutions (for example, penal and mental facilities and homes for the aged) and who are not on active duty in the Armed Forces.

Source: Bureau of Labor Statistics

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