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Sunday, June 14, 2009


Special Flag Day Post

This special Flag Day post is coming to you from Minneapolis, MN, where it has been sunny all weekend and right now, a warm 84 degrees. Downtown Minneapolis is quite beautiful,with its many fine stores, restuarants, bars, etc. Famous Dave's has held its barbecue and blues festival which concluded yesterday on Nicolette and featured many fine local bands. Unfortunately, several of the downtown streets are pretty torn up as shovel ready projects proceed, and constitute a hazard for anyone wearing dress shoes. In fact, the entrance to the Hilton, which is serving as the host hotel for the insurance regulators conference (the NAIC) is fairly well blocked by one of the projects. Other than that, Minneapolis has been the perfect host city.

You sure would not guess that we are in the middle of a severe recession walking around the downtown here, as all of the folks seem to be out and spending. There do seem to be more homeless types than I recall from the days back in the 1990's when i visited here frequently. That seems to be the case in every US city.

The state insurance regulators are having their usual paranoia that the Feds are going to take over regulation of the business, but in fact, my own view is that that prospect becomes less likely each day as the industry recovers from the battering its investment portfolios took. Still there is lots of concern here about how residential and commercial mortgage securitizations will fare over the next year or two.

Another topic of conversation here, as you might guess, is what form any new health insurance "solution" might take. Yesterday, the funded consumerists (representing who? They don't represent this consumer!) were making the case for a public insurer option that somehow is going to be cheaper and provide even better access than what we have now. Everyone will be able to get in the plan regardless of any pre-existing conditions, and, of course, doctors will save on paperwork, etc. etc.

It's just amazing that we haven't already gone down this road where nirvana is so easily achieved. And of course, nary a word about tort reform in any of this. Magically, our cost problem will just go away. Medicare is basically the model. All we have to do is extend the medicare program, or one like it, to everyone.

Never mind that medicare is going broke. I wonder, by the way, whether any of these consumer health advocates have ever really looked at a medicare billing statement from the provider's viewpoint, or are they just too busy cheering because their parents' surgeries and hospital stays cost next to nothing after medicare "negotiates" and reprices.

If doctors got compensated for their entire practice the way they get paid for medicare patients, they would all quit since they couldn't afford to pay their malpractice insurance premiums. That's why increasingly, you see them posting signs in their office warning that they don't go through medicare or medicaid and that they don't have malpractice insurance.


The Mets lost another game on a dropped popup Friday night. It's going to keep happening as long as there are no consequences for shoddy, careless play. This is not second guessing - we've blogged about this before. Sure enough, the perpetrator was right back in the lineup the next day.

We'll catch up on the stock transactions when I return to the East Coast. We don't give investment advice on the blog, but I will say that this is a particularly dicey period for investors, and a good time to maintain their asset allocation disciplines. A Wall St. Journal column recently related how so many investors sold at the bottom and are now wondering whether it's too late to get back in. Wrong question. Wrong approach. That's why most Americans are not competent to manage their 401(k)'s, I'm afraid. If you allow your emotions to dictate your timing, you are almost sure to underperform.

Time for my next meeting. Sorry if there are more typos than usual.

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