Mortgage Meltdown Blues

The White House and major money merchants are cobbling together a scheme to temporarily freeze interest rates on select subprime mortgages to stave off further collapse in the banking system, and create a response from the Bush administration to criticism it's been sitting on its thumbs until now. *

I am particularly amused at the slightly oxymoronic--select sub-prime--phrase to describe these loans. One pundit has called them the financial equivalent of buying skim milk at cream prices. How apt. Either way, someone's been getting milked.

So the plan in the works is intended to reassure investors and anxious homeowners as loan rates on more than two million adjustable mortgages are slated for increases within the next 24-months.

Smoking the peace pipe are regulators in the Treasury Department and a coalition of mortgage-related companies including Citigroup Inc., Wells Fargo & Co., Washington Mutual Inc. and Countrywide Financial Corp. The Coalition is called the Hope Now Alliance, which is working to extend the lower "teaser" rate on home loans for families who would have trouble making payments once their mortgages increase. Or some kind of pipe.

What about the rest of us?
I know that's a little selfish, especially in this season of "peace on earth, goodwill to all men," but what about rest of you who, like me, have been faithfully paying our mortgage payments without fail since before the sub-slime meltdown. What’s in it for us?

It’s like getting a flyer in the mail from your cable company, offering ridiculous rates for new customers. Makes you feel like a chump for paying full rate, while your next door neighbor, who wasn’t sharp enough to get on your plan, is getting a break for coming late to the party.

Same deal with the cell phone people: They offer free phones, obscene teaser rates, and frequent flyer points for jumping on a two year contract. Meanwhile, you’re paying your contracted rate, dealing with spotty service, and have a year old phone held together with duct tape and superglue.

I see these introductory pitches and I feel like I need a jar of Vaseline…
Where’s the love for the rest of us?

*Wouldn't William Faulkner have been proud of that epic opening line?

Act as Needed

I wish I’d had within my grasp the usage of three key words as I was growing up. Words that had the power to turn vast empires 180-degrees, just by uttering their magical sound.

Three simple words, chanted at just the right time, to charm my professors into giving me a better grade…

Three elegant articles of grammar, innocuously designed to persuade without providing any promise of follow through, but when invoked, created enough motive power to inspire entire nations to rally.

“Act as needed.”

Those were the holy verbal trinity from the English Lexicon that sparked yesterday’s three percent-plus rally in the NASDAQ, a boost of over 2 ½ percent in the Dow, and an amazing jump of over 2 ¾ percent on the broad S&P 500.

Federal Reserve Vice Cheerleader Donnie Kohn said the FOMC would “act as needed” to foster price stability and employment in coming months.

I wish I’d had those three words at the ready when scolded as a child.

“Are you ever going to misbehave again, young man?”
“I will act as needed, mom.”

“Sir, do you realize how fast you were going?”
“Officer, I was only acting as needed.”

History-making, history-altering words: How differently would things be if Neville Chamberlain had instead of “Peace in our Time,” said the allies would “act as needed”?

How different might France be today had Marie Antoinette ditched the “let them eat cake” gobblety-gook, and simply said, “let them act as needed.”

The entire course of human history would have been altered if Adam had told Eve to just “act as needed,” or if Bill Clinton had instead answered, “I only acted as needed with that woman.”

The question that remains unanswered is what is the need, and how will the Fed identify, recognize, and then act in a needful way?

Seeing Red for the Holidays

I hope you’re commute is better than mine this morning…and arguably, I’ve got it pretty easy, coming in before most of you are even out of the sack. Still, there are challenges in traffic, even at 4am.

Like the moronic paper route drivers, who insist on driving on the wrong side of the street with their high-beams on; they’re also the worst about running stop signs—not just rolling through them, but just blatantly disregarding them.

Then there are the coffee sippers who typically sit in a lane traveling at exactly the same speed as the dork next to them, effectively creating a rolling road block at 27 ½ MPH. I know what they’re thinking: “Hey, it’s hours before the sun comes up, what’s the rush?” That, or, “I’ve been out all night already, why hurry home now?”

I had a pretty uneventful commute today.
Buddy was stuck in a freeway closure between a cement truck and an Exxon Tanker.
Luckily, Buddy doesn’t smoke.

I nearly ran into a fella in a large, extended-cab pick-up truck—actually, he nearly ran into me, as be blazed through an intersection with a barely-amber light. It was about two shades from red, truth be told.
Again, it’s frickin’ 4am.
Where’s the fire?

Running red lights in my town is so insidious the local constabulary has installed red light cameras at many key intersections. Obviously, this one was not one of them.

I have mixed feelings about red light cameras.
As a rule, I generally don’t run red lights on purpose, so they’re not there for law abiding folks like me. I’m not convinced they’re that much of a detraction for people who are flagrantly ignoring traffic signals, either. And I do have a problem with police agencies resorting to Big Brother tactics to ensnare traffic scofflaws.

The City where I live recently had a black-ops test flight of a drone aircraft. No media were invited, and in fact, those that found out about the test were bluffed by the police to back off. The media didn’t back down, and the police brass had to come clean that, yes, they were testing drones, and no, they wouldn’t rule out using the spy craft to generate traffic enforcement revenue.

Hold on, Chester, this may be where I decide to move to some wide spot in a rural intersection. I love the big city, but I’m not too keen on Big Brother keeping an eye on me or anyone else.

Paranoid?
Not me.
Just dislike sneakiness.

Back the point of the red light incident this morning. Read where some ya-hoo in Knoxville, Tenn. actually shot-out a red light camera with a .30-06 rifle. He could be fined and have his gun confiscated if convicted.

By a jury of his peers?
Might not be too tough to prove…but would anyone blame the guy?

Numbskull Deficit Disorder?

Are you ready for the next child development anomaly?
First there was A-D-D: Attention Deficit* Disorder.
(*Truth be told, the deficit of attention lies with the parents in many cases, not paying enough attention to their kids…)
So, get ready for the Next Big Thing: “Nature Deficit Disorder.”

I received a breathlessly-worded press release this morning, that trumpets the rise of "the first generation of Americans to grow up disconnected from nature." They’re advocating giving our children a "Green Hour" a day: "a bit of time for unstructured play and interaction with the natural world – with which we can set them on the path toward physical, mental, and emotional well-being."

I love this.
I had plenty of Green Time when I was a kid.

My mom basically exiled me from the house into the back yard, which was an imaginary jungle, battlefield, underground lair, and general purpose mud hole in which all of the neighborhood kids liked to waller.

We had trees to climb, a tree house my father built from which to command the world, and lots of hedges in which to hide and allow our imaginations to run wild.
Yes, we swang from vines and ropes.

The Kaiser Family Foundation ran a study revealing the average American kid “spends 44 hours per week (more than 6 hours a day!) staring at some kind of electronic screen.

Studies have linked excessive television viewing to obesity, violence, and even lower intelligence in kids. Now, a growing wave of research indicates that children who spend time outdoors are healthier, overall, than their indoor counterparts.”

The really funny part about this: to wean your kid from the flat panel screen, and launch them into the great ourdoors…the press release advises to go on line to http://www.greenhour.org/.
Oy.

Cyber Monday!

"You never know what is enough, unless you know what is more than enough."
-William Blake
MarketWatch Headline, early this morning: Research shows consumers opened their wallets on Black Friday, giving early market sentiment a lift, though credit worries linger.

Good news and not so good news from the Black Friday tallies:
Store traffic was up over 4% from last year…but spending was down 3.5% from the National Day of Shopping Frenzy of last year…numbers courtesy of the National Retail Foundation. Shoppers spent an average of $347 Thursday thru Sunday… The final results of this year’s retail Christmas will not be determined until the final two weeks of December.

How about those early store openings—any of you get up for that thing on Friday morning? 14.3% of shoppers were out and about before 4 a.m. this year compared to 12.4 percent last year…One of our guests, Scott Kays, took the opportunity for some quality father-son bonding, while camping out in front of a Best Buy in Atlanta. Pup tent, Coleman stove, and mass quanitites of hot chocolate consumed while awaiting the portals' opening, and they weren't alone--nearly 300 joined them at that location.

Plan ahead for next year, o ye entrepreneurs: storefront concessions selling hot drinks and warm food should do a land-office business for similar retail locations.

I am told that 1 in 12 –about 8.2%, has finished their holiday shopping. That's just disgusting if you're not through. You can gloat along with the Redeemed if you're finished. Retail Foundation bean counters expect total holiday sales for the November-December period will rise 4 percent to $474.5 billion, its slowest growth rate in five years.

Today is when the other shoe drops…or mouse, as the case may be:
It’s Cyber Monday.
72 million are expected to shop online from home or at work today for after-Thanksgiving bargains. ComScore Networks say today's online sales to surpass $700 million, which could making it the heaviest online spending day on record.

I spent the weekend on the couch with a bottle of Nyquil, a jar of Vick's, and the family mascot, which kept trying to lick-off the Vick's. I conducted a small amount of commerce on line, but pretty much hybernated in a head-cold stupor.

Hope your week is better...

On Giving Thanks

This is the time of year when Americans pause to count our blessings and give thanks for our bounty.
I believe we’d be a richer country if we conducted this ritual more frequently than once every November. Even the poorest Americans are better off than most humans living in less-developed parts of the planet.
We often lose sight of that, I fear.


It troubles me, too, that we get all caught up in the notion of “giving thanks” and being “thankful,” without a definite follow through to that idea. What’s seldom publicly stated is to whom or what the expression of gratitude is directed. Like an incomplete equation, we are poorer for not making the completion.
It wasn’t always that way.

According to http://www.history.com/, “the Plymouth colonists and Wampanoag Indians shared an autumn harvest feast in 1621, which is acknowledged today as one of the first Thanksgiving celebrations in the colonies.

“At Berkeley Plantation, Virginia, near the Charles River, a group of British settlers led by Captain John Woodlief in December, 1619, knelt in prayer and pledged "Thanksgiving" to God for their healthy arrival after a long voyage across the Atlantic. This event has been acknowledged by some scholars and writers as the official first Thanksgiving among European settlers on record.”

I have been jousting over the past few months with a listener who is an acknowleged Athiest, and I know this posting is going to send him over the edge. But c’mon, when you give thanks at Thanksgiving, if not to God, to whom is the gratitude rightfully expressed?

I am thankful for our government, warts and all, but I am not grateful to the government.
I am thankful for my house, but I am not ingratiated to the house for the comfort and protection it provides me.

The point is, tangible things and intangible blessings of peace and prosperity arguably come from a Higher Power, and that power does not originate from governments.

Just as many thoughtful Americans are returning to the historically-flawed but more meaningful “Merry Christmas” salutation, instead of the antiseptic and politically-correct “Happy Holidays” version, I think the time has come for us to return to the roots of Thanksgiving, and say it like it is: Thanks be to God for the blessings we enjoy.

Frankly, if you have a problem with that, I pity you for the comparatively shallow meaning that remains of this holiday observation.

Turkeys of a Feather

Finance is the art of passing money from hand to hand until it finally disappears.
Robert W. Sarnoff
This place is crazy: Kohl’s is opening at 4am Friday to launch the 2007 Christmas Shopping Season?

What could possibly be important enough for you to climb out of bed and get down to a department store at 4:00 in the morning, short of a fire or someone driving through the front plate glass window? Can you think of anything?
Neither can I.

President George W. Bush is pardoning a couple of turkeys in the annual pre-Thanksgiving White House ceremony. I didn’t know Hugo Chavez and Mahmoud Ahmadinejad were back in the country.

CNN wrote this morning, "The bird and its understudy are from Indiana and each weighs about 45 pounds."
Since when does a Turkey need an understudy?
Oh, yeah, the writers are on strike.

The pardoned yard birds will be spared a dinner table fate and then flown to Disney World in Florida. I hope the same fate does not come to them that befell a young seal pup, shortly after the Exxon Valdez fiasco. Environmentalists had rescued the seal from an oil slick, nursed the animal back to health, and then staged a PR event as they released the creature back into the wild in Prince William Sound.

As cameras rolled, the tiny seal cavorted and playfully splashed back into the water…only to be snapped up and swallowed by a passing Orca whale.

Given Disney’s safety record, Orlando might not be the safest place for these turkeys; don’t they have Orca’s doing tricks in Florida?

Would have made a great MasterCard commercial:
Cleaning up the Alaskan coast line after Exxon Valdez: $2.1 Billion.
Cleaning up and rehabilitating a stranded Seal Pup: $1,000;
Having the seal pup swallowed whole by a predator on camera: Priceless.

Christmas in November

I hate to admit it, but we put the Christmas Tree up this weekend. Oh yeah, 85-degrees and brilliantly sunny, and I’m in the attic, passing down Rubber-Maid containers of ceramic figurines, lights, and rolls of decorative ribbon.

And more Rubber-Maid boxes of miniature Christmas village buildings, cars and people (what, I don’t have to deal with enough of the big city in real life?)

And more Rubber-Maid cartons of glass-blown decorations, frilly stockings (to hang by the chimney with care, etc., etc.) and more seasonal figurines than the Army of the 5^th Ming Dynasty.
Now, those were some serious figurines!

So, it's not even Thanksgiving, and my evergreen spousal unit had to have a tree and all the trimmings up this weekend. Because next weekend, it’s over the river and through the woods, to Grandmother’s house we go, and the weekend after that, she and the aunts and nieces and near-nieces and favored spouses are heading over the border and into the hills of Arkansas for the annual shopping frenzy.

It’s a woman thang.

This is a double shock to my system, since I’ve barely recovered from the later-than-usual onset of Standard Time, as the Lord in Heaven counts it. But I must confess a certain level of contentment this evening, as the family mascot and I cuddle on the couch, listening to a Jim Brickman Christmas CD, and the timeless Mannheim Steamroller Christmas collections.

The room is filled with the warm glow of the tree at one end of the room, and nothing more than the glow of this laptop to illuminate my keyboard. And it's 75-degrees outside.

Guess this means all those planned-ahead Christmas gifts I’d found over the past few months will need to start “appearing” under the tree, and plumping the limply hanging stockings. Now, if I could only remember where I put them…

Media Facts of Life

FCC Chief Kevin Martin wants to relax the media cross-ownership rules in the 20 largest cities in the US to give struggling print outlets a better chance for survival. Hmmm…let’s think about this together: The Internet has been around for a while now, at least since Al Gore invented it, and some (struggling) newspaper operations are just now getting on board?

See the reality is that the print guys that aren’t making it right now generally haven’t made the switch to online editions. I know, I know, that’s hard to believe, especially from an AM Radio guy like me. Don’t I know that AM is dying, FM is swooning, and Satellite Radio is the wave of the future? Perhaps.

The AM stations that are dying are the one’s the big conglomerates ran into the ground the last 20-years, killing local content, canning live announcers in favor of voice-tracking, and discovering they could run twice as many :30-second spots in the same time it took to run a :60-second commercial. What these Media Mensa’s failed to grasp was that people like listening to people, not machines, that you can only tell half as much of your story in a :30 as a :60, and as soon as advertisers figured out they were no longer getting their money’s worth from these dumbed-down media installations, they took their business elsewhere.

Oh, and Radio listening was also competing with TV, Cable, the Internet with its downloads to iPod’s, movies, DVD’s and living life with media that allows multi-tasking without sacrificing too many brain cells. Fortunately, Radio still allows you to listen while you work; unfortunately, too much of the content is just not listenable much these days.

Back to the Papers. There is a fundamental problem with the FCC cutting these losers slack, when the one’s that were on the ball figured out where information media was going early on: On Line.

I say let the dinosaurs die.

Soon, there will no longer be a generation around who longs for the tactile satisfaction of crumpled newsprint, and the tell-tale smudges of fresh ink on fingertips.

I have a wonderful photograph of my Grandfather, George W. Clanton, standing in the front yard of his home, reading the evening paper after work. I am much like him in that regard:
I still love to thumb through each page, reading the daily paper cover-to-cover.

The demise of the afternoon papers in Houston has taken that pleasure away. Now, you read it in the morning, after the news has been written, edited, proofed, and printed the night before. By the time the distributor lobs the morning edition onto my driveway, the news is nearly 12-hours old.

My son loves to read the paper, too, but he’s just as happy getting the latest news from the internet. I expect that my grandchildren will never have an appreciation for reading news “hot off the presses.”

As these generations fade away, so, too, will the daily print media business for the most part. And not even bending the rules of media cross-ownership can alter the fact that the audience is gradually going away.

Three-point Prescription for Good Loan Portfolio Health

Another crap shoot in Vegas last night with the Democrat’s latest debate. See, this is what you get when Hollywood writers go on strike.
Reruns or reruns.

Meanwhile, back at the Ranch in Washington, the House decided to crack down on mortgage lenders by forcing them to get licenses, making them responsible for discovering whether borrowers can really repay, and fining them for steering people toward risky subprime loans.
Well, I’m glad we got that solved.

I’m sure Mortgage Lending Licenses will do about as good a job of controlling stupidity in the credit approval department as drivers licenses are effective in curbing stupidity behind the wheel. Let’s put a punitive clause in there for "closing mortgages while under the influence" (CMWUI)… and if you get caught, you have to sit through an 8-hour video on safe lending practices, rendered by a stand up comedian. Or an out of work Hollywood writer.

I love the part about making lenders responsible for discovering whether borrowers can really repay their loans. Here's Dr. Clanton's Three-point Prescription for avoiding stinky loans:
a.) read the loan app—there are some amazing clues in there
b.) ditch the liar loans—the one’s where you tell the bank what you’d like to make each year, despite what your bank account says you really bring home.
c.) Use math skills acquired in the 5th grade: If Johnny has $5 and spends half of it on a Big Mac, how much does he have left over for all of his other obligations? Maybe some of these guys really aren’t smarter than a 5th Grader…

Back in the day, when a seller came to my credit desk with a willing buyer with less than worthy credit, we’d ask the seller to give the lender full recourse on the loan. In other words, if you want to sell this house so badly you’ll lie, cheat, or steal to get the deal done, why not just sign the back of the contract, promising to pay the bank if your buyer doesn’t?

I found it amazing how that lens clarified for the seller the issues that were killing the approval process from the lender's perspective.

Even with full recourse, there are no guarantees. How many home builders go out of business, leaving full-recourse deals totally worthless to the lender? Which gets back to that little issue of lie, cheat, or steal to get a deal done...and the fact that not even Congress can legislate morality.

Also, the House has provided for $200 million for foreclosure prevention counseling. The money will be used by nonprofit foreclosure prevention programs to counsel those who may lose their homes because of risky subprime loans.

Hey, here’s a novel idea—why not spend that $200-million for basic credit education skills—let’s start it at the high school level—so that first-time buyers of anything using credit (cars, houses, big screen TV’s) know the tricks of the credit trade, and how to not get in over one’s head. Spend the money on the front end, and there' s less likelihood of having to spend money on the back end, cleaning up messes.

Warren Buffet Rebuttal

The Oracle of Omaha opened his mouth this week and spewed forth fundamentally flawed froth: Warren Buffet actually told the Senate Finance Committee the government should “take a little more out of the hides of guys like me,” in discussing the future of the Estate Tax.

Here’s the deal: If your Estate is worth more than $2-million this year, and you die, anything over that amount gets snatched by the Federales at a 45% rate before your heirs get theirs.

In 2009, anything above $3.5-million is partially confiscated…and in 2010, the Estate Tax is Repealed, only to return with a vengeance—and a lower, $1-million threshold—in 2011, with a tax rate of 55%

I realize that for most of the American public, such thresholds far exceed most of whatever levels of wealth that may be amassed over a lifetime. These rules won’t apply. However, I have a basic problem with the Government deciding how assets must be managed, and I approach apoplexy whenever anyone proposes the government is entitled to 55% of anything earned by an American citizen, never mind that it is applied to amounts north of $1-million.
It’s just wrong.

Iowa Sen. Chuck Grassley correctly noted, "instead of the free market determining when assets are bought or sold, the Death Tax makes that determination;" [it is] "fundamentally wrong when the government swoops in after a funeral to take a cut of what that person had worked their whole life for, and has already paid taxes on at least once."
Amen.

Buffet’s supposed rationalization for encouraging confiscatory taxation on the nation’s wealthiest is to avoid the emergence of a meritocracy, or perpetually-funded aristocracy built upon the largesse of past generations.

Tell you what, Mssr. Buffet, why don’t we make it voluntary for you rich cats to give the government 45% of anything over $2-mil this year, and see how many want to buy in.

I have a sneaking suspicion that just because a fella is worth several million doesn’t make it any less painful to remit a chunk of it to Uncle Sam. That pretty well blows away the argument that “the rich can better afford to pay taxes because it is less of a slice of their pie,” etc., etc., yada yada yada, puke puke puke.

I know lots of rich guys—richer than me—and they’re tighter than bark on a tree. That’s how they got rich, in many instances, by being naturally frugal.

The second fundamental problem I have with this notion is the "more you make the more we take" mentality that’s pervasive in Congress.
Where did that come from?

So in America we'll still have the constitutional right of the pursuit of life, liberty, and happiness, but if we get too happy (or profitable), we’ll be knocked down by Government fisco-Nannies, afraid we’re going to damage ourselves by spending all that money we make.

(Have these nimrods taken a look at Federal spending, lately?
And that’s not even their money—it’s ours!)

Nope, Warren, you’ve got this wrong.
Love you to death, you're a smart guy, even if you missed that whole Internet thing and all.

If you want to give the Federal Government a piece of your hide, fine. But never invite the government to confiscate earnings just because "rich" folks can “better afford” it, or because of a fear too much wealth might be concentrated in too few households.

The Federales are always changing the rules--or the definitions of terms, like "rich," for example. Cede to them this license, and "next thing you know, ol' Jed's a millionaire..."

Humbugged Holidays

“On the 12th day of Thanksgiving, my true love gave to me
A bottle of Xanax and a roundtrip airfare for the holidays.”

Could be the opening lyrics of a sequel to the famous “12 Days of Christmas” song we like to hear around this time of year.
Once.
It’s not cute the other 99-times it’s played every holiday.

The travel season is bearing down upon us like a freight train…or a runaway Airbus 380.

The twelve days between the Friday before Thanksgiving and the Sunday following Turkey Day are the new frontier of holiday travel horrors:
Air carriers are hunkering down to handle about 27 million passengers worldwide…and the planes are expected to be about 90% full on average.

Its estimated carriers will deal with 2.5 million passengers on the Wednesday before Thanksgiving and the Sunday and Monday after the holiday.
Average traffic this year has been about 2.1 million passengers a day, with planes running about 80% full.

You know what the problem is, this time of year, don’t you?
The holidays draw out the less-savvy travelers to the airport. People who only get on a plane once a year, which translates into meaning more baggage to check, and longer and slower lines as the neo-passengers fumble for items or struggle with security rules.

The latest security line indignity: “Would you please remove your drivers license from your wallet, Mr. Clayton.”
A. It’s CLAN-ton, you moron. That’s an “N,” not a “Y.”
B. What’s wrong with the clear plastic sleeve in my wallet, specifically designed to show my license and avoid in line fumbling?

Did you ever try to manage two carry-on bags, stand in your stocking feet, and pull your driver’s license OUT of your wallet, while being pushed from behind by a crush of equally irate passengers?

I’ve already got my travel plans ready to roll: Flying to NY for Christmas. Not packing anything; I’ll buy what I need when I get there. Going to wear surgical scrubs and flip flops through security screening.
Merry stinking Christmas.

Doing the Write Thing

Thanks to Jack Warkenthien for filling in on Friday while I was in the Land of Fruits and Nuts…You know, we tried to reason with those striking creative writers at the sitcoms, but to no avail…and now, the stagehand workers in New York are pouting, stalling production on 28-Broadway plays.

Global Media Intelligence, a research company, and Merrill Lynch have just completed a collaborative report on whether movies are really making money anymore, which might render the position of striking writers somewhat moot. But, as in all things American, it seems, the proof is not as much in the pudding as in the accounting.

An analysis of the report by the International Herald Tribune suggests the folks the writers might consider picketing would be the actors and directors, who’ve really pocketed the lion’s share of the money in the form of “participations:” a share in the gross revenue of a movie, not the profit.

It has been estimated that the film studios have paid out as much as 25% of film revenues in this manner. According to the Herald Tribune analysis, a “Hanks, Cruise or Carrey whose movie brings $600 million back to the studio from all sources might easily wind up with a $20 million salary, and an additional $50 million on the back end, while an A-list director and producer could take in tens of millions more.”

The effect is that those with such arrangements can end up with huge paydays, even on movies that are money-losers.

There are two things to keep in mind as you absorb this data:

Participations in studio projects are growing exponentially, as losses by the studios continue to mount.

“Total sales for last year's slate, the company figures, will ultimately be about $23.7 billion, down about 4.6 percent from 2004. Total costs, meanwhile, rose to $25.6 billion, up 13.2 percent,” according to the Trib’s reading of the numbers.

If the other studios are trying to keep up with the Jones’ (or the Disney’s), then it is estimated they are paying out shares worth $3 billion, while piling up an almost $2 billion loss on their new films.

The prickly point for the writers has been over residuals—the contractual payments writers receive when their work reappears in other media. The writers want this increased for future media appearances. The problem is, those residuals are paid after all of the accounting alchemy is performed…and after the actors and producers “get theirs” in participations payments.

If the A-listers are getting theirs before anyone else, and the films are still losing more and more moeny, there's not much left over in the first place--let alone room to increase the share of residuals paid. The Writers Guild of America West says movie residuals were just $121.3 million in 2006, a drop in that $3 billion bucket.

With a lucrative "first dollar gross" deal, however, one of these big stars can take home $70 million or more from a single hit.

While the writers are griping, the reality is that such profit negotiations are the result of willing buyers and willing sellers. Perhaps the best the writers can hope for is a diminishing of the will to operate with a two-tiered pay scale. After all, without the writers, some of these silver screen egg heads can't utter two intelligible sentances back to back.

Dept. of Halloween Security

The Department of Homeland Security is investigating a Halloween costume party hosted by a top immigration official and attended by a man dressed in a striped prison outfit, dreadlocks and darkened skin make-up. Some said the costume was offensive.

Whoo—glad we’re getting to the bottom of that.
Sure wouldn’t want to offend anyone who might be in this country illegally.
Don’t want to step on the toes of anyone who might be considering nefarious deeds against the United States.

Are we the laughing stock of the world, yet?

A recent poll noted how tourism to the US has sloughed off over 20% since 9-Eleven because our country is now perceived as un-welcoming.
Well, excuse me.
We're just a little snake-bit after that episode a few Septembers ago involving box cutters and steering aircraft into tall buildings.

Sorry if you happen to dress like a middle eastern terrorist stereotype, and we don’t want you here.

Meanwhile, you and I and other WASPs are singled out for random screenings in airport security lines—yeah, I look like I’d blow up something—little old ladies in wheel chairs, and infants in carriers are given the heave-ho.
It’s absolutely ridiculous.

And when some goofball shows up at the office halloween party—which just happens to be in the Dept. of Homeland Security—wearing a jailbird outfit, someone else gets uppity??

We were sitting in one of those harassment training sessions not long ago, and we reached the point of diminishing returns. The stuff in the presentation was just stupid. No one gropes the women in our office, none of the women are tapping the guys on the backside.
It just doesn’t happen.

And the boss said, “stop the tape."
"Here’s the bottom line," he went on. "We run this place with a high level of personal respect, and there will be jokes, and there will be light moments, and because we work so closely, there will be times when hugs are shared, and genuine, human emotions are shown. And if you don’t like that, you don’t have to work here.”

I wanted to cheer.
I wanted to applaud.
When are the real Americans among us going to stand up and say to the PC police, “enough!”

Let’s get on with the business of building and creating and being innovative…and if you’ve got a problem with how things are run, go find another gig somewhere else. If you’re smart and intelligent and productive, you’ll find a place that better fits your psychological comfort zone.

Someone having a good time…wearing prison stripes…offends a co worker?
Get over it.
Get a grip.
Get another job.

Frankly, I don’t want humorless androids working in Homeland Security. I want creative, imaginative, expressive employees to be my eyes and ears on the enemy, because folks, that’s what the enemy is: creative, and expressive and determined. And we must meet them head to head, toe to toe, tit for tat. And if that offends you, maybe you’re living in the wrong place.

Car Wars

I’ve decided my next car will be a 1970’s era land yacht, with chromed bumpers front and rear, and a nice wide hood and rear deck, fore and aft of the cockpit.

The paint may not be in great shape, but that’s actually going to be a plus, because the reason my next personal automobile may likely take this form is because I am sick and tired of trying to keep a nice car looking nice, driving around in a city full of slugs who don’t care.

A fella in a pickup truck backed into the nose of The Silver Bullet this afternoon in a parking lot. We were lined up in the exit lane to pay our parking fee, and he decided he’d waited long enough, cranked it into reverse, and plowed right into me before I knew what hit me. Dude's trailer hitch did a grand job of converting my clear-plastic license plate cover into a shattered mosaic of Lucite, and the metal tag into a concave bug catcher. There are now two, distinct impressions of the backside of the license holder hardware, permanently embedded in what was virgin clear coat, paint and plastic.

I remember the first, brand-new car I ever owned came to a similar fate, shortly after I’d bought it. A bright yellow 1976 Honda Civic, barely six weeks old, reduced to so much crumpled tin by a snot-nosed teenager in his father’s “borrowed” ’68 Lincoln, plowing into the prow of my car in an intersection. Even then, subliminally, I knew, one day I would own such a monstrous piece of Detroit iron, purely for survival purposes.

When my firstborn was in High School, he figured out a way to pull out of a parking lot in front of a speeding, mid-80’s vintage Cadillac Fleetwood, while behind the wheel of a mid-80’s vintage Honda Wagon. Guess which vintage automobile won that encounter?

With a fatherly measure of punitive vengeance, I replaced that car with a 1972 Chevrolet Caprice Classic 4-door sedan, Banana-yellow, with white leather interior. Hey, it was a sharp car—bought from a man who’s mother had just passed, and it was her car, kept in the garage, just driven to church, etc., etc., yada yada yada.

My kid hated it.
I loved it.
It was big, highly visible, took up most of its lane, and compared to the smaller car, exponentially safer in most encounters with lesser vehicles. Plus, since the “Banana Boat,” as it became known, was considered not-cool, it was less likely to be driven for recreational purposes. That suited me just fine.

We didn’t keep the Chevy too long. My father traded-up, and we bought his cream-puff Toyota SR-5 Pickup truck, which lasted my son through the rest of high school, the 6-year degree plan at college, and beyond.

Tonight The Silver Bullet is sulking in its stall in the garage, the license plate holder a tortured mess, nose skin and ego slightly bruised. Ahead looms the obligatory insurance adjuster hustle and jive with a quote or two for repairs. Honestly, the biggest expense here is my time. Since my bride dropped a bicycle on the hood the first week I had the car, and some clod opened a car door into a front wheel opening, it’s no longer a virgin. I really just dread the hassle the worst.

Meanwhile, I’m on the lookout for a gently owned behemoth that I can drive into town without giving a second thought to where I park. And if someone should ding a door, bump a fender, or plow blindly backwards into the grille…so be it.
I am older and carry more insurance.

Lending Advice

House Financial Services Committee Chairman Barney Frank wants to reform the mortgage industry, including using the Federal Reserve as implementer of that mortgage reform.

With all due respect, here are the points of mortgage reform that need implementing:

1.) Don’t loan out more money than a borrower can reasonably be expected to pay back.
2.) Pay the note.
3.) Do not digress from Rule number one or two.

Any questions?

DST to CST, FYI

Daylight Saving Time mercifully ends this weekend.
Huzzah!

Ever since its earlier-than-usual onset in March, my circadian rhythms have been beating in 5/7 time as I attempted to waltz through my days.

Congress inflicted this longer than normal DST period on us as a nod to conservationists, convinced that flipping clocks forward in the Springtime, thus “lengthening” our daylight hours, would save beaucoup barrels of oil as we waited an hour later to turn on the lights at night.
Silly mirries.

First, this isn’t 1935, and most of us aren’t toiling in the fields from sun-up to sun-down. We’re not waiting an hour later to turn on the lights at night, and in fact, I would submit we all turned on the lights an hour earlier in the morning because we we’ve been getting up before the chickens since March.
It’s a zero-sum proposition.

For guys like me, who always get up before said yard birds are stirring, and who must retire earlier in the evening than most, the extra hour of daylight has been an affliction.

So this weekend, as we turn our clocks, watches, computers, coffeemakers, water sprinkler systems, thermostats, in-dash computers and garden sundials back 60-increments of time, I welcome its return with open arms and steeping eyelids.

We live in a global economy, in a 24-7 society.
Frankly, I wouldn’t be surprised if the analysis showed that lost productivity, due to sleep deprivation and wasted man-hours managing networks for the augmented hours, actually outweighed any perceptible savings in energy for the time shift.

Maybe I’m getting old and crotchety, but if it were put to a vote tomorrow, I’d cast my ballot to leave alone the time of day. How arrogant of the Government to presume to tell us when to rise and when to go to bed. Flip your clocks back this weekend, and leave 'em alone.