HEALTHCARE AND ENERGY SOLVED

taking a cue from jonathan swift, i have come up with a solution to both our energy and healthcare problems.

my eureka moment came during a recent visit to Memphis Tennessee. i was staying at the weston and when i check in i was in line behind 2 couples who were so large that they blocked all view of the front desk.

i then went into the elevator and it had a sign on maximum number of people and maximum weight. if you divided the two, it called for an average weight of about 167 lbs. however looking around, the average looked around 250.

i then went to the gym and was the only person there, two days in a row.

so it re-emphasized that we are one fat assed nation!

so here is my idea

we will have mandatory liposuction for all overweight people
the fat will be rendered and distilled into a fuel

this will result in a healthier population and a new fuel source. more people will fit in elevators, plane fares will come down as weight will be lower and fuel costs per flight lower; plastic surgeons will make enormous money and spend it on fancy cars and restaurants and clothes.

a virtuous circle.

NET NEUTRALITY AINT SO NEUTRAL

as frank lund says, words make a difference. junk bonds bad; high yield bonds good. have you noticed that almost all legislation passed by congress has the word reform in it. financial reform, health reform, campaign finance reform. we are just a country of reformers, making things better all the time.

which brings me to net neutrality. now net neutrality sounds like it must be a good thing. the net is important and neutrality is a good thing so net neutrality must be a really good thing. Switzerland is neutral and they are good right? aside from taking deposits from despots, drug and arms dealers.

anyway down to cases. there was an excellent article in the nytimes of all places but sourced by reuters that framed it as a battle between the pipes and the swipes. the pipes are the people who build the physical infrastructure to deliver bandwidth, verizon, att, direct tv, etc. the swipes are the people that use this bandwidth to deliver digital content like apple, google, microsoft etc.

now the pipes have spent and continue to spend year in and year out tens of billions on capital expenditures. and they want a return on this capital. the swipes and all the app and content providers want to ride on all this capital investment with a somewhat parasitic business model where the costs are born by the pipes and when they either raise prices to support their investment or offer premium service for a premium price; people howl at the evil pipes.

now where else is it ok to have unlimited consumption of a scarce resource for a flat, capped fixed amount? if you use more water, you pay for it. if you use more electricity, heating oil, gasoline, etc you pay for it. so why is it a crime to charge for more bandwidth? it aint free.

this has very little to do with neutrality. it is merely a commercial fight that should get sorted out in the market place. we should aspire to something akin to universal internet connectivity at some reasonable level of bandwidth but if i want more and faster i should be able to get it and have to pay for it.

your thoughts?

THE CONCERT. A MOVIE THAT SHOULD BRING YOU TO TEARS

enough about finance, econ and political malaise. how about some culture

went to see the movie, The Concert. it should make you cry, laugh, and cry again but with tears of joy. a really remarkable film

please see it

RAISE RATES TO GROW THE ECONOMY

thats right, we should raise interest rates to grow the economy. while europe has been trying to balance budgets and i think raise rates a bit, their thinking, i think, is budgets should be balanced so why not start now and tighten monetary policy to prevent inflation from the easy money policies implemented world wide during the crisis

in the US, we have a totally manipulated yield curve. whenever there is a banking crisis, the feds supply liquidity and often manipulate the yield curve such that short term rates are very low. this initially helps with the crisis but also creates a risk free arbitrage for the banks to repair their balance sheets. they borrow from the feds at near zero and can invest in medium term government securities and make a 300bp spread with no risk and little interest rate risk due to maturity mismatch.

this is all fine for awhile. but no longer. when you can make 300bps risk free why lend to somebody who has some risk? the answer is you dont and that is one of our problems today; lack of extension of credit to small to medium size businesses, sme's and even larger companies that are still too small to access the high yield bond market.

we don't need zero per cent short term rates. if the feds let rates go up to say1.5 per cent, still very low, this ought to force the banks to lend money to people and companies, not this incestuous arbitrage with the feds. for most businesses its not about the cost of money its about the availability of money. they would happily pay 7% for short term debt to fund working capital because their gross margin can justify it.

you want banks to lend, take them off the feds teat.

now long term rates are lower than they should be also, due to among other things the government buying its own bonds and manipulating the mortgage market; but that is a whole other story

MANNING AND ASSANGE SHOULD BE HANGED!

the classified information that bradley manning and julian assange leaked will cause people to be tortured and killed. manning as a US citizen and a member of the armed services should be tried and convicted for treason and hung. julian assange, who is not a US citizen, will be responsible for the damage and should be liquidated.

A DAY WITHOUT A MEXICAN

illegal Hispanics are fleeing arizona ahead of the new law being implemented. they are selling their things on the cheap and leaving. businesses that cater to them will be closing; real estate they are renting will go vacant. where will the people of arizona get their maids, their gardeners, etc.

there is a great movie available on dvd call A DAY WITHOUT A MEXICAN; about how all the mexicans in california mysteriously disappear. it is only an ok movie but the premise is brilliant

watch it and then think about a proper immigration policy should look like

ABC; ANYBODY BUT CONTADOR

well lance blew up. bad luck? too old? who knows. still the best but out of contention. so here is the plan. lance makes a secret pact with andy schleck and helps schleck and lances team mate levi leipheimer onto the podium and next year andy and frank schleck join radio shack

its a thought