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August 30, 2010How safe is your money market fund?
July 6, 2011Punch line: Amid the Greek mini-panic this month, did you notice the really shocking news? To wit, U.S. regulators are worried about the “systemic risk” posed by the exposure of American money-market funds to European bank debt.
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According to the WSJ:
A 1983 Securities and Exchange Commission rule allows money funds to report a stable net-asset value of $1 per share, even if that’s not precisely true based on changes in the fund’s underlying assets.
The result is that investors have come to expect that money funds never “break the buck,” never decline in value.
But since 2008 U.S. money funds have been allowed to pile into European bank debt.
Half the assets in U.S. prime money market funds were invested in European banks as of the end of May.
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Bottom line: If Greece tanks and takes down some Euro banks with it, the impact will be felt by US money market funds … which could possibly break a buck …
U.S. teachers' hours among world's longest … oh, really?
July 5, 2011According to the WSJ and the Organization for Economic Cooperation and Development:
- U.S. primary-school teachers spend only 36 weeks a year in the classroom — among the lowest among the countries tracked
- But, U.S. primary-school teachers spend 1,097 hours a year teaching – the highest among the countries tracked – and well above the OECD average of 786 hours.
And, according to the OECD, that’s just the time teachers spend on instruction. Including hours teachers spend on work at home and outside the classroom, American primary-school educators spend 1,913 working in a year.
According to data from the comparable year in a Labor Department survey, an average full-time employee works 1,932 hours a year spread out over 48 weeks (excluding two weeks vacation and federal holidays).
Despite the amount of time that teachers spend working, student achievement in the U.S. remains average in reading and science and slightly below average in math when compared to other nations in a separate OECD report.
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Hmmm.
Teachers work an average of almost 11 hours per day when school is in session,
And, teachers put in about as many hours in 36 weeks as “average full-time employees” do in 48 weeks,
Color me skeptical …
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“For Sale, Bring Cash”
July 1, 2011Punch line: USA Today reports that “cash buyers are kings in weak home-sales market.”
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According to the National Association of Realtors, in May 2011, all-cash buyers, who are mostly investors, accounted for 30% of existing home sales, up from 12% two years ago.
The cash buyers are enticed by low prices and potential rental income.
Cash buyers are especially prevalent in markets where prices have fallen the most, often areas hard hit by foreclosures.
- In Las Vegas, the foreclosure capitol of the U.S. for the past four years, cash buyers accounted for 49% of first-quarter sales
- In the Miami-Fort Lauderdale area, 63% of first-quarter buyers paid in cash.
- In Phoenix, 44% are cash buyers.
Cash buyers often get better deals because sellers know their offers won’t fall through for lack of financing. A 5% cash discount is typical.
Source: USA Today
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Herman Cain’s bona fides …
June 30, 2011When pundits speak about Herman Cain – or introduce him for an interview – they usually reference him as the (black) tea party candidate and former Godfather’s Pizza CEO who once hosted a talk radio show.
As reported by The Atlantic:
It hasn’t gotten much attention that Cain was chairman of the Kansas City Federal Reserve Bank in the mid-1990s.
The Kansas City Fed is one of twelve regional banks that advise the Federal Reserve Board and initiate changes in the discount rate.
The Kansas City Fed in particular has a reputation for monetary conservatism and distrust of central authority.
From 1992 to 1996, Cain served as a director of the Federal Reserve Bank of Kansas City in the capacities of deputy chairman and then chairman of the Board.
Hmmm …. puts a whole new paint job on the candidate.
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Maryland adds ‘environmental literacy’ to HS graduation requirements … huh?
June 30, 2011Last week, the Maryland state Board of Education approved an environmental literacy graduation requirement: High school seniors in Maryland will have to demonstrate literacy on environmental matters to graduate from now on.
According to the AP, public schools will be required to infuse core subjects with lessons on conservation, smart growth and other environmental topics.
Maybe that’s a good idea, but consider:
According to the Editorial Projects in Education Research Center, only about 74 percent of all students in Maryland graduate from high school with a regular diploma.
Less than 2/3s of Hispanics and African-Americans get a high school diploma.
The obvious questions:
1) Will the HS graduation rate go up or down when an additional criteria – any criteria – is added?
I’m better the down side …
2) Recent statistics indicate that a large proportion of HS graduates get their diploma with an adequate foundation in reading, writing and arithmetic.
Shouldn’t attention be laser-focused on those subjects?
3) Seriously, does it matter if inner city kids are schooled in ‘smart growth’?
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Pepsi decides to focus on, well, Pepsi …
June 30, 2011Ken’s Take: Indra Nooyi — PepsiCo’s CEO — is an Obama fav because she pushes healthier foods (even healthier than sugar-water and corn chips ?) and charity causes.
Bottlers ask “Is she ashamed of selling carbonated sugar water?”
Investors and industry insiders are concerned that her push into healthier brands have distracted the company from some core products.
When flagship Pepsi-Cola dropped to number 3 – behind Coke and Diet Coke – even Ms. Nooyi had to take notice.
Her plan: flashier containers and a summer ad campaign featuring Santa.
Might work …
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Excerpted from the WSJ:
Snack-food and beverage giant PepsiCo is launching the first new advertising campaign for its flagship Pepsi-Cola in three years—offering one of the most visible signs PepsiCo is throwing new weight behind its biggest brand after it sank to No. 3 in U.S. soda sales last year, trailing not only Coke but Diet Coke.
Ceding the top two spots to rival Coca-Cola Co. marked a huge embarrassment in a cola war that traces its roots to the 19th century.
PepsiCo is launching its first ad campaign in three years with a spot that focuses on its Pepsi-Cola. “Summer Time Is Pepsi Time” featuring Santa on vacation.
PepsiCo says it plans to spend about 30% more this year on TV advertising for its North American beverages, with soda a big focus.
As recently as 2005, PepsiCo spent $348 million on soda ads in the U.S., almost as much as Coke, which spent $377 million.
But by last year, the company had more than halved its spending to $153 million, while Coca-Cola spent $253 million, according to Nielsen Co., which tracks advertising.
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In late 2008, Pepsi implemented a costly overhaul of all brands, that were looking “tired on the shelf.”
PepsiCo launched new graphics for all the big beverage brands and new packaging for more than 1,200 individual products, an unusually ambitious redesign.
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Move over, Richard Simmons …
June 30, 2011Wally the Walrus is latest fitness icon.
Click the pic for for a smile …
Obama’s a genius, Bachman’s a dunce … oh, really?
June 29, 2011The mainstream media had a field day on Monday when Rep. Michele Bachmann kicked off her presidential campaign on Monday in Waterloo, Iowa, and in one interview surrounding the official event she promised to mimic the spirit of Waterloo’s own John Wayne.
How stupid can she be?
Everybody knows that John Wayne grew up in Winterset, Iowa … not Waterloo.
According to various sources, Waterloo is where his parents met and married, not where The Duke was raised. He grew up in another Iowa town.
How could anybody with a brain get the facts so wrong?
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Now let’s compare that to a gaffe that was largely buried by the mainstream media.
Visiting troops at Fort Drum last week, President Obama confused two of his Medal of Honor recipients, referring to one of the soldiers’ comrades who was killed in combat in Afghanistan as being alive.
Speaking to the 10th Mountain Division Obama reflected on the time he spent with members of the Division.
“First time I saw the 10th Mountain Division, you guys were in southern Iraq. When I went back to visit Afghanistan, you guys were the first ones there. I had the great honor of seeing some of you because a comrade of yours, Jared Monti, was the first person who I was able to award the Medal of Honor to who actually came back and wasn’t receiving it posthumously,”
The mainstream media’s explanation: the President simply misspoke.
To put the gaffe in perspective: the Medal of Honor is the highest award in the country, and Obama has only bestowed 6 Medals of Honor.
I guess even a genius can get confused when he’s trying to remember 6 award winners and trying to keep his place on the teleprompter.
Imagine if Bachman (or Bush) had made that mistake …
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Follow-up: Why are there more U.S. troops on South Korea’s border than on our own border?
June 29, 2011Yesterday, I posed the question:
Why are there more U.S. troops on South Korea’s border than on our own border?
Specifically, there are about 200 US soldiers per border mile between North & South Korea, but only is about 1 agent or soldier for every 10 miles along the US-Mexican border.
A loyal HomaFiles reader provided an thoughtful answer to my question.
Well this one is pretty easy actually: We are defending against a greater economic threat to the U.S. in South Korea than we currently face in most of the area adjacent to the Mexican border. To wit:
1) North Korea has the world’s largest artillery force, some 13,000 pieces of which are deployed at the DMZ
2) The Korean People’s Army (aka the bad guys) has ~1.1 MM soldiers (plus a reserve of 8 MM) with 70% of that active force within 100km of the DMZ
3) Seoul, South Korea is just 50 from the DMZ and produces ~$210 billion in GDP (Hong Kong is ~$225 billion)
4) Any enduring attack on Seoul would create global supply-chain chaos – much of which would disproportionately impact the U.S. and its allies
5) The most effective deterrent known to the world are U.S. men and women in uniform alert, aware, and armed to the teeth
Draw your own conclusion …
Why are there more U.S. troops on South Korea's border than on our own border?
June 28, 2011Excellent question posed by CNN’s Jack Cafferty:
There are 1,200 National Guard troops deployed along the U.S. border with Mexico.
The troops were scheduled to leave June 30th, but an extension is likely.
To be fair, there are about 20,000 border agents also on patrol along the 2,000 mile long U.S.-Mexican border.
That’s about 1 agent or soldier every 10 miles.
In comparison, there are 28,000 U.S. troops stationed along the South Korean border with North Korea.
The border between North & South Korea is only about 150 miles.
So, there are almost 200 U.S. soldiers per border mile in North Korea.
And, that’s not counting the highly regarded South Korean army.
Does that make sense to you ?
Hmmm …
profkenhoma 