What’s a bank to do?

The FDIC has run out of insurance funds largely due to the 95 bank failures so far this year. They are looking at three options to replenish the fund:
• Borrow $35 billion from the Treasury. I’m not sure taxpayers would appreciate another big bailout for the banks, especially since the big ones are reporting multibillion dollar profits and bonuses. The media would have a field day.
• Borrow the money from the banks. This way they would get the money from the banks. But instead of it being an expense against capital, it would be an asset on their books. An asset when it is really an expense? Think Enron.
• Delay the decision by requiring the banks to pay their annual fee 3 years in advance (of course this is the one they have opted for). They get the cash from the banks to get through this year and the banks don’t need to account for it as an expense (yet). But what about next year and the year after when no money will be coming in from the banks? Think social security and Medicare on a shorter leash.

The option they are not considering is the one they are suppose to use by regulation which is assess the banks for their shortfalls. Ah, but those banks have lobbyists.

New Text Record

An anonymous AT&T user sent 662,258 txt messages in a 30 day period using his iPhone. You're probably thinking "get a life" but sending that many messages isn't the worst of it. The guy opted to receives his bill on hard copy. 12,000 pages of hard copy. He should be locked up. At a minimum, I hope he recycles.

... And how about AT&T actually sending it to him. An alarm should have gone off in somebodies brain. This is an example of why small businesses can compete effectively with the big guys.

Lifelong Republican ... Not

I was a republican for most of my life. (There were those flower-child years in the late 60s but that changed when I started paying taxes.) I grew up in a republican family in a republican community. Ronald Reagan’s tax cuts and Bill Clinton’s tax increases had me locked for life or so I thought. What happened to the party? I have trouble finding a single issue where I agree with it.
• No new taxes – Why not no new “net” taxes. Government needs to be able to adjust taxes in both directions. The republicans have permanently tied one arm behind their backs simply to get votes, not for the good of the country. I’d like to see lower business taxes and higher taxes on the top brackets (me). I think “death taxes” are good. I sympathize with the argument that taxes have already been paid on this money but I think that if one person makes a fortune, it should not insure that every generation thereafter will never need to work. I think a tax system that carves away at inherited wealth is a good thing such that the 4th or 5th generation after the money is earned will need to go out in the world and contribute to a nation’s productivity.
• Anti-immigrant – All of the legal and illegal immigrants I have met are hard working, family oriented people that contribute to our overall good. The strong economy, low cost-of-living in Texas is proof of that.
• Anti-gay – They are what they were born to be. They deserve the same rights as everyone else.
• Small government – Hah!! The government never grew so much as it grew under Bush. It is only rhetoric. The government has become an oligopoly controlled by lobbyists. Democrats are only slightly better in this regard.
• Anti-abortion – It is hard to be against babies, I love babies. But the truth is that the world is over populated and getting worse by the day. The planet pays a horrible price, especially other species.
• Anti-healthcare – They are all for babies until they are born. Then babies are on their own. I think we should catch up with the rest of the industrialized world and provide reasonable healthcare for all of our citizens.
• Pro-guns – Is there not a gun that should be illegal anywhere. I dare you to find a republican that doesn’t think that anyone should be able to carry anywhere. Yeh, I know. The dems have totally cratered on this issue.
• Pro-defense – Do we really need to spend more than the rest of the world on our military? When you look at all of our wars since we became a “super-power”, does it look like a net positive to you? Couldn’t the money have been better spent on energy independence? If we didn’t have our military presence meddling in the Middle East, they wouldn’t all want to kill us.
That probably covers most of it. It makes all the sense in the world to me but you probably think I’ve lost it. Tata.

Favorite Picture

 

This is my new favorite picture. My hair is combed, my shirt matches my jeans and I even, sort of have a smile. Not sure where I am but that is not all that unusual. And I'm not sure how that little monster, Hayden, got on my lap. She is such a picture hog. Good thing she didn't ruin my favorite picture.

My New Favorite Sam Walton Story

Jim Collins, author of “From Good to Great”, has a new book “How the Mighty Fall” where he goes through the 5 stages that powerful companies experience on their way to failure. It is a good lesson on learning from someone else’s mistakes. Interestingly, the “mighty” companies and the market still think they are doing great through the first three stages of failure. The first stage is “Hubris”. Collin’s best example though was of a company that did not suffer from it, Walmart. Sam Walton was certainly proud of the company he had built but never thought he had it all figured out.

A group of Brazilian investors purchased a discount chain. They thought it would be a good idea to see how some of the world’s greatest retailers operated. Sam Walton invited them up to Arkansas. Sam picked them up in his pickup truck and welcomed them to Bentonville in his low key manner. They were there for two days before they realized that about the only thing they had done so far was answer Sam Walton’s questions. Sam built the largest company in the world but when he met someone new, he had the attitude, I know what I know so let me learn what you know.

Sam Walton knew the power of listening and learning. I know I'm a good listener ... Oh, excuse me sweetheart, have you been talking to me?

Government - What it can't do

As citizens we need to realize that the government we created has serious limitations in what it can do. Our elected leaders will not take meaningful action if it involves offending a large voter block (seniors) or major campaign contributor (big business). Obama was given credit for a major, hard fought victory when he saved less than $2 billion dollars by not ordering more cold war jets that the military did not want. Congress has been unable to make simple adjustments to social security (peg increases to cost of living rather than wages) that would keep it solvent for decades longer. They don't even attempt to solve Medicare funding or lack there of. They are basically paralyzed when looking at the issues of today:
• Global warming, probably the greatest threat to my grandchildren – Don’t expect congress to take dramatic action to stem CO2 emissions. No $2/gallon tax on gas and no major carbon taxes on industry that will make a difference. They won’t happen until way too late in the game. The only hope is if we can innovate our way out of it. Government can fund innovation. We waste a lot of time and effort trying to get government to do the stuff it won’t do.
• Health care – The current system is broken beyond repair. Small businesses can’t afford it for their employees. Medium size businesses are headed that way. Fifty million Americans are uninsured and tens of millions more underinsured. Unfortunately the fixes involve those things the government won’t do. They won’t be able to carve out the 30% administrative expense needed to keep track of eligibility and all the different plan types because this is also known as insurance company revenue, a major employer and campaign contributor. Health care actually needs to be rationed by rational people. Everybody can’t have the greatest healthcare money can buy. So we do nothing and today we have nearly the worst healthcare of any western industrialized country.

What our government does give us is an economy where usually the best businessperson wins. Our efforts to get government to take action should be for things that promote businesses that will solve our problems. That is something government can do.

Feelin' sorry

Our clearest memories are usually visual. Often wars are represented by a couple photographs. Vietnam was the Kent State shooting or the naked little girl hit with napalm. Iraq is abu ghraib or on the positive side the purple thumbs indicating they voted for the first time in an election that really counted.

Sometimes a photo will affect you more than others. The war photo etched in my mind was that of a dead Iraqi man with his Jack Russell Terrier nestled in next to him ... the same way Bailey sleeps most nights with me. I felt really bad for the dog. Now the tables are turned. The little dog that has been my almost constant companion for nearly 14 years needs to be put down for a variety of health issues. Tomorrow I take her to the vet and say goodbye. Now I feel sorry for me.