AHJ

On Treasuries, Contrarians and Diversification

There is a supply and demand curve. There will need to be savers (a supply of lenders) as well as a demand for treasuries). When the United States completes its march towward National Socialism (within 2 more years?) and thus has no more internal people to save, and China stops supplying the funds,.... who will provide them? Rates will rise even if demand is low (recession) since there will be no more supply of funds after the foreign President is finished with us.

One Way Life Insurance Customers Can Protect Themselves

The comments about the guarantee funds have some merits but the accounting comments are ridiculous. In general, insurance company regulatory accounting is so absurdly conservative that it is a drag on the ability of the industry to raise capital. GAAP accounting (used for investor purposes) is on the other hand meaningless in the insurance industry. Generally neither too conservative nor too liberal, just a gibberish inappropiate attempt to be consistent with accounting methodology for other financial firms (e.g.banks) from which no conclusions can be reached. So this John Doe, when he mixes and matches comments about the parent company's position (a company reporting under GAAP because it presumably is a public company not reporting under NAIC standards), shows he has no idea what he is talking about.

It would be like saying. The Chicago Cubs won their Division last year and yet the Tribune still sold fewer want ads in their paper, proving conservatism in the reporting of the revenue from the want ads of the parent company (the Tribune). Every reader would know such reporting was foolish gibberish.

On Apr 01 07:48 AM michael55555 wrote:

> I think "John Doe" should be reported to the NAIC, because he clearly
> doesn't know what he's talking about and I have very serious doubts
> that he's licensed to sell life insurance. The separate account assets
> and liabilities are *always* at fair value. If a policyholder owns
> a separate account product then they have the only claim on the assets
> backing it. The term "variable" might it away, as in "variable universal
> life" or "variable annuity". In those cases there is *NO* counter-party
> risk to the cash surrender value. I'll repeat: NO COUNTER-PARTY RISK
> to the cash value. Guaranteed death benefits or guaranteed living
> benefits do have counter-party risk and are backed by the guarantee
> funds, within limits. The time to look at life settlements was a
> few months ago before they began pricing with an updated mortality
> table. The table reflects much longer life expectancy than they were
> pricing with before, so the payouts have dropped significantly. see:
> www.bloomberg.com/apps...;sid=aFktBLBpBWiE&...

About the Fed, Purity, and Barney Frank

I had a wisdom tooth pulled about a week ago. Every night I have been going to bed with the tooth under the pillow and have been looking for my quarter each morning and been diappointed (I'm 58 years old). Now, you have me worried with this comment about the tooth fairy? Are you now also saying, I can't trust Barney Frank's concern for my welfare? Next thing you'll tell me my Social security lock box isn't locked?????? Only 8 more years until my Social Security benefits start (not until 66 for my cohort) and someone has opened my lock box?

Please don't get started on Santa Clause or the Easter Bunny or that my dollars aren't backed by gold at $35 per oz., you Grinch!


On Mar 05 10:53 PM ED K wrote:

> If you believe Barney Frank is concerned about the welfare of the
> country you also believe in the tooth fairy.

2009 Depression Will Be Nothing Like 1929

They didn't have a strategy of rewarding failure and punishing success in '29. If I invest in a winner, the windfall profits will be given to whomever turn out to be the loser in 2010. I'm sticking with gold until we come back to a philosophy of letting winners win and letting losers lose.

They also didn't have the equivalents of an Obama and Pelosi and an obvious tax cheat for the Treasury secretary leading the way. We had a moral compass at the head, and that is more important than the internet or any other technical tool.

Tim Geithner and Taxes

Just an update: I am working on my 2008 tax return, again using the flawsless turbo tax software. Turbo tax as as in past years still automatically calculates the self employment tax for me (Timmy Geithner bought a different version of the product: They sell a "Home version, Business version, Geithner vrsion, etc.?) and it still produces the schedule SE unless I want to cheat and override the program and respond "yes" when it asks "are you sure you want to override the program".

So if timmy were still self employed and still wanted to cheat, he would still need to override turbo tax and still couldn't blame turbo tax for his cheating. (Unless he still wanted to pay more and buy the "Geithner" version of Turbo tax, available only in certain states.)

4 Reasons Why 'Going Green' Will Put Many Investors in the Red

Fabulous article. I was a fool to have participated myself in investing a bit in this bubble via the ETFs, FAN and TAN.

Even with all the money and political support chasing alternative energy they won't make it without subsidies and they will do even worse with subsidies. They need miracle technological break throughs which will never happen as long as government is involved. Just imagine how Microsoft would have done if the Feds had been "helping" Bill Gates all those early years? We'd all be using punch cards to send our emails to protect the jobs of the key punch operator union workers.

I do still think there is a future for nuclear and natural gas if those are considered "alternative". They don't need subsidies and they don't need government help, other than having government get out of the way. But that won't happen until the Obama administration blunders us into a war or other crisis which shuts off oil and forces us to use USA Natural gas and nuclear resource over the protests of the tree huggers.

I also explored a hybrid car in 2008, but due to estimates that I would need 8 years to break even on the cost/benefit of the fuel savings (I'm retired and don't drive enough miles to make it pay for me even at $4.50 a gallon for gas), I decided to hold on to my 2000 Ford Crown Vic), so at least I didn't make that fashionable mistake in 2008.

We do need a non traditional energy solution. But it will come from some place we most likely aren't looking and it most likely will succeed bet if government does not give it a subsidy. The subsidies will doom or slow down the currently favored alternatives. How about geothermal? Or is there any way to harness the wind from the windbags in Congress? We could sell the excess and cover the energy needs of the Saudis for centuries.

Five Laws That Government Should Pass

Stand in line for the treasury secretary job. See my prior psot.

1. I am smarter than timmy since I am an acturay and know more about financial risk management than timmy (of course so does my 3 year old dog, Padfoot).

2. I have never used the override routines in Turbo tax to get around the automatic generation of the self employment taxes that turbo tax generates and can't be avoided "innocently" unless one lies to turbotax in the entries or responds 3 times to turbo tax that one wants to over ride the self employment tax. Therefore, my confimation hearings will be easier than timmy's and won't embarrass Barrack even though I am a "prominent" person and hence don't really need to be paying taxes in the first place.

3. Any fool can use turbo tax to do a personal tax return. I have used it for 10 years for my fairly complicated return with no problem. If timmy can't figure it out, he shouldn' be hired to get coffee for the office staff at H&R Block much less be hired to play treasury secretary like a big boy. He clearly isn't smart enough for the job if he made an "innocent mistake" with all the prompts turbo tax provides. Padfoot does his own return with my help only where Padfoot's lack of thumbs cause problems for him with some of the key entries.

The Market Is Improving, Cancel the Coffin

Responding to your request for what else they could do to drive the Dow down:
1. The "elephant in the room" of course has been that no one seems to have asked Obama or Biden if they have thought they also were "too prominent" to have paid their taxes. Perhaps they too thought that only the "little people" pay income tax on the cash part of their compensation? or the free food in the lunch hall or whatever other perqs the "little people" don't get which are clearly spelled out as taxable perqs to congressmen and Senators? Timmy could announce he planned to tell the IRS to audit Biden and Obama's tax returns as well as the returns of everyone in the House and Senate.

Two days later, he would say he had been misunderstood. He would say he had conferred with President Obama and Ted Kennedy and other advisors. He would say, "Obviously, we aren't going to distract these prominent people with audits in the middle of the important business of running the country in this time of crisis."

2. Tiny Tim could explain (during his next speech) how the Federal reserve system works in a way everyone understands (he is smart so it might be possible) which would panic "the little people" once they understood what their money is worth.

3. Tiny Tim could announce some "good news" regarding the financing of the next treasury auction. He would announce that we had entered into a "friendship treaty with China under which they had agreed to purchase a certain level of securities for a certain number of years (and to not sell off their current holdings) in return for our "friendship" in certain matters pertaining to China's "internal matters" with Tibet, Israel, Ireland, Canada, and California concerning trade, free speech, freedom of religion, forced abductions/abortions, and Monday night football.

4. Tiny Tim could explain (during his next speech) how to make an override calculation to self employment income (in Turbo tax) to avoid paying self employment tax. Turbo tax automatically generates the self employment schedules and taxes for you. It is impossible to make an "innocent mistake". The mistake requires effort (if one uses turbo tax). After you make an override to the system, at the end, Turbo tax, then reminds you that you made an override to their system, and asks, "Are you sure you wanted to make that override to our system" During his next speech, Timmy could tell everyone on National TV "how you can circumvent paying taxes by making an override entry to turbo tax". This of course would cause huge shortfalls in tax revenue, but coming as a technical recommendation from the Treasury secretary, it could not be challenged by the IRS. The tax returns filed all across the USA with everyone's taxes equal to $0 would all be unchallengeable. This would lead to the markets falling as the projected deficit would increase by the projected lost income tax revenue of ?? This "might" lead to a decline in the Dow.

Markets are not recovering from their disappointment with Geithner's non-plan and the stimulus bill, with the Dow making its biggest drop since December. Dow down 358 points, -4.32% to 7913. S&P -4.55% to 830. Nasdaq -3.81% to 1531.

If Timmy was making license plates (like tax cheats used to be asked to do)instead of providing us with his current services, we might have had a better performance on the Dow today, but probably lousier license plates.

Is Financial Catastrophe Imminent?

When FDR took office, whether or not you liked his policies or they worked, he was a leader. He acted like a leader by restoring calm, by saying to the country:

"The only thing we have to fear, is fear itself"

When fearless leader Obama came in, he "leads" by screaming "FIRE" as he runs into the burning theatre. while caring some roman candles creaming we need to buy the Roman candles right now at $5,000 each from Tiny tim or there will be no hope.

Living on $500K a Year?

These Wall Street guys have no clue. The successful banks (small local banks) would never hire these losers, with or without a pay cap. So they have no where to go except the other Wall Street banks. So the only way around the cap will be to cheat, or to work for the government and cheat and/or get their tax free income there. (We all know high level Federal officials don't pay taxes as only the little people and private people on Main street pay taxes because taxes are too complicated for the foks at high levels and for people on Wall Street.

Tim Geithner and Taxes

How do I explain to my son and my future grandchildren that we value intelligence ("smartest man for the job") over honesty? Or is he smart? I have used Turbo tax for years and I am smart enough to follow the instructions. I am an FSA (actuary), went to the same high school as Rahm Emanuel (New Trier), have a BS in Math from the University of Illinois, and have never failed an IRS audit, and have never committed or even been accused of commiting a felony like defrauding the United States of America. I am retired and have the time. Therefore, I hereby apply for the job of Treasury Secretary and see no reason I won't be approved by the end of next week, since I am smartr than Timmy, more connected than Timmy, more honest than Timmy and know both the asset and liability sides of the balance sheet (I am an actuary and Timmy isn't). I will fly in Monday for my house hunting trip with my wife and beautify son. Please let me know to whom I should send my relocation bills. I won't have to explain any integrity issues to my son.

(I am primarily retired but do some part time consulting and have paid my self employment taxes since 2000 per the clear Turbo Tax instructions, so this won't be a problem during the confirmation hearings. I got a 31 on my ACT and a 36 on my Math portion. How dod Timmy do? I passed my Fellowship exams at age 25. How old was Timmy when he passed all of his??).

The End of Citigroup

Why don't we killl 2 birds with one stoen and "give" Citi to IRAN. Then we wouldn't have to go to war with them and we could destroy that country and their nuke program within 2 weeks without loss of a single American life and cut the US 2009 deficit by 40%


On Jan 13 09:01 AM Ishortyou wrote:

> God knows what it could happen but one thing is certain and that
> correction of their books need to be done. Their brokerage arm has
> a lot of toxic waste in their books that need to be put at the open
> to take a closer look, so this move not necesarily seems to be that
> bad as long as that branch takes the uncertainties with them.