John Maynard Keynes, the famous English Economist whose theories are back in vogue, wrote: “In the long run, we are all dead.”
Rocky Humbert, the obscure American curmudgeon and speculator, writes: “In the long run, prices revert to their long-run mean.”
This morning’s Case-Schiller Housing Index (-19% annualized) shows that housing continues to revert to its long-run mean.
This chart shows the major asset classes since 1987. Black=Housing. Red=CPI. Yellow=stocks. Green=commodities.
Trophy Wife asked Rocky to replace a dozen burned-out lightbulbs in their home.
A routine request, except that Rocky replaced all of their old incandescent bulbs with new, expensive, energy-efficient compact fluorescent bulbs 24 days ago! (Rocky’s massive bulb-change was in celebration of the wildly succesful Boost-The-Economy-Buy-A-Lightbulb-Day.)
Was this mass bulb burnout an innocent quality control failure? Or was it more sinister? (Perhaps a conspiracy to shorten Rocky’s life using tall ladders and electricity?)
Rocky naively believes that Lee Harvey Oswald acted alone. And that Princess Diana’s death was just an accident. Not surprisingly, Rocky is skeptical that the Mob “put out a hit” on him (via faulty lightbulbs). Today’s New York Times bolstered Rocky’s non-conspirarcy-theory theory with a story about widespread lightbulb quality control problems. (Click on: “Do New Bulbs Save Energy If They Don’t Work”)
“Some experts … blame the government for the quality problems, saying an intensive federal push to lower the price essentially backfired by encouraging manufacturers to use cheap components,” reports the NY Times.
“Ah,” Rocky thought, “It’s ALWAYS the government’s fault.”
Since the new bulbs are more expensive than incandescents, consume energy to manufacture, and disperse toxic mercury during disposal, it begs the timeless question: “How many people does it take to change their opinion about the efficiency of a compact fluorescent lightbulb?”
Rocky’s readers are invited to share their lightbulb experiences in this poll:
After months of tense negotiations, Lehman Brother’s Bankruptcy Trustree and Barclays Bank settled a bitter ownership dispute about golf balls.
Bloomberg News reports that thousands of Lehman logo knicknacks were mistakenly transferred to Barclays in the firesale of Lehman’s brokerage unit. They will now be returned to their rightful owner for “liquidation.”
The inventory included:
1,630 Green canvas duffle bags with “Lehman Green Ribbon.”
353 Green compact golf umbrellas.
75 Waterford crystal clocks.
682 White Lehman coffee mugs.
130 Swiss Army pens.
1 English beechwood-lined sterling silver box from 1902.
200 Lehman conference pens.
12 Pairs of Links of London cufflinks.
24 Screwpull corkscrews labeled “LB”.
24 Titleist PRO VI golf balls labeled “LB”.
30 Girl Teddy bears.
18 Large women’s F&G stretch snap shirts
1 Tiffany shooting star.
After surveying this treasure trove, Rocky finally understands why Lehman went down the drain.
No competent management buys Swiss Army Pens. If Dick Fuld had instead bought “One-Handed-Parachutist” Swiss Army Knives, Lehman would still be alive today.
[Disclosure: Rocky owns no Ebay stock, but was briefly tempted to buy some: Most of these knicknacks will find their final resting place in Ebay auctions… probably without any bidders.]
Many banks give free pens and toasters to new depositors.
At Redneck Bank, they send you a free beer-can holder. (See picture above.)
Many banks have serious slogans (“The Citi never sleeps.”)
At Redneck Bank, their slogan is “Where bankin’s funner!”
Many banks have spokesmen with gravelly baritone voices, meant to instill confidence and demonstrate gravitas.
At Redneck Bank, their spokesman is a talking horse. And, to enter their online banking portal, you click on the door to an outhouse.
Most importantly, at most banks, the money market interest rate is near zero.
At Redneck Bank, they pay 3.10% APY on balances up to $35,000.
Rocky lacks any pretensions. Especially when it comes to making money. After checking with the FDIC to ensure that Redneck Bank is fully insured (it is,) he opened a new money market account.
Rocky successfully transferred $1,000 from his Citibank account to Redneck Bank. But the Redneck website generated an error message whenever he tried to transfer more money. He went to Redneck’s on-line chat and tried to reach a Customer Service Representative. But that didn’t work either because every time he typed the word “Redneck,” their syntax filter (more puritanical than redneck) generated a pop-up message which scolded: “You have used foul language! Your message will not be sent!”
Finally, Rocky called their 800 number. He learned that Redneck imposes a 30-day waiting period on new account owners “to prevent fraud.” Although mildly annoying, Rocky concluded that Washington Mutual might have learned a thing or two from those Rednecks!
For more information, see: www.redneckbank.com
[Disclosure: This is a true story. Redneck Bank is the internet banking division of the Bank of the Wichitas, and is a member of the FDIC system.]
The Berkeley City Council is poised to transform all city parks and open spaces into habitats for bees.
The San Francisco Chronicle reports that a proposed City Resolution requires all future landscaping to be “pollinator friendly.” The goal is to attract bees, bats, moths, beetles, and flies to the city parks.
Rocky appreciates nature, but he doesn’t enjoy swatting mosquitos during a picnic, or getting stung while playing in the sandbox. (He also admits to secretly stashing a can of Raid Yard Guard in his garage behind the organic mulch pile.)
Rocky concludes that the Bee and Beetle Lobby must have undue influence on Berkeley’s elected officials. He protests the City Council’s unfair favoritism of bees — at the expense of other, equally deserving species. Please join Pied Piper Rocky at his upcoming “Rats for Parks Rally” and “Million Rodent March” to raise public awareness of the plight of Berkeley’s oppressed rodent population.
Panda bears now share something in common with AIG’s employees: Barack Obama’s wrath.
In a speech before the National Conference of State Legislatures today, Obama said that Washington’s stimulus package specifically excludes funds for zoos. (Circling sharks will be disappointed: the law also prohibits funds for aquariums.)
In a Jimmy Carter-esque symbolism, Bloomberg News reports that Obama also said that he was postponing plans to modernize electrical and heating systems in the East Wing of the White House because this too “doesn’t meet the standard of creating new jobs.”
Rocky notes that the last time his air conditioner broke, a middle-class working man with two kids and a dog came out to fix it. He never realized that the White House uses leprechauns to fix their HVAC systems.
“Gentle sea breezes, warm sunshine and the sound of the ocean surf,” were the minimum requirements for Trophy Wife’s dream beach house.
Rocky doesn’t like the ocean. (He says, “If man were meant to swim, he’d have webbed fingers and toes.)
Rocky doesn’t like the sun. (His friends call him The Vampire, since he rarely ventures out before sunset.)
Rocky doesn’t like warm weather. (He wears the same heavy charcoal-colored British wool sweater. Every day.)
Nonetheless, Rocky, a dutiful spouse, recently visited Miami Beach, and toured beachfront properties. Rocky concluded that even in this horrible real estate market, suitable beach houses were not a “bargain” at several million dollars. More importantly, they were only 10% to 20% below the peak price.
Always the miserly arbitrageur, Rocky fired up his laptop and started googling….
Gentle Sea Breezes
The Aloha Breeze White Tower Fan ($35.00)
The Smell of the Ocean
Air Wick Ocean Breeze Liquid Air Freshener ($4.97)
StayTanNorth Deluxe Tabletop Tanner ($169.99)
The Sound of the Surf
Ecotones Adaptive Sound Therapy Machine ($299)
Walk to the Beach
Membership at the YMCA ($460)
Total cost: $968.96
“So you can have all the benefits of a Florida beach house, for under a thousand dollars,” Rocky excitedly showed Trophy Wife. “What do you think?”
“I think you should go jump in a lake,” Trophy Wife replied.