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Saturday, February 05, 2011


Egypt and other points of interest

It was kind of hard to find, but we did receive a new comment (from a new commenter) who had some interest in the January 17 post, but posted the comment in an earlier post (not his fault - we still are not happy with the comment format on blogspot and have been unable to figure out how to fix it). For those who didn't see it (assume that's everyone), and because it poses interesting questions, here it is:

Hi RedWave:

Regarding your January 17th post, it was interesting to see someone from the right interested in paying for the treatment of our mentally ill. Or did "seeing to it" only mean that we should insist on their getting into treatment? If they fail to get treatment without our paying for it, do we then throw them in jail? I do believe we should spend more to provide care for the mentally ill. Still I cannot help but be amused by your ability to point to that, with no mention of background checks for gun buyers. Worried about your reputation with others on the right? If that is the case then be careful they don't think you are in favor of paying for other people's medical problems. Sincerely, Dr. C.

So Dr. C., that's a lot of good questions and a challenging dilemma for the right concerning medical costs for a meaningful population of ill and often indigent souls. Let's consider them in order.

Walk around any city in this country, as I have related in many posts following my business trips, and especially places like New York, San Francisco (perhaps, the worst) Denver, D.C., etc. and you will encounter an alarming number of folks begging for change, and it's clear that the majority are indeed homeless and many are also suffering from mental illness. Most of these people are not dangerous, or even annoying, but this is a life without quality or discernible purpose. Disregarding those who are able and are in fact professional beggars, it would be both humane and responsible to get the mentally ill off the streets and into treatment. Where the illness constitutes a danger to others, it is also a matter of public safety. In any event, providing treatment and shelter for these folks is a legitimate purpose and use of taxpayer funds, at the state and municipal levels. If such people refuse shelter and treatment, jail is a less attractive option (there are vagrancy laws not being enforced); perhaps there is a legitimate state interest in providing a required mental examination and base subsequent treatments, mandatory or otherwise, on those results. So the short answer is the right is not so doctrinaire as to deny the validity of any public services, and I believe my thinking on this is pretty mainstream for the right.

In fact, it is the folks on the left who seem to have insisted on emptying the institutions and thrusting all of these poor folks out into the street. Granted the institutions often needed upgrade and reform, but I just don't get how the current situation is more "humane."

As for background checks for gun purchases, my understanding is that they are occurring, though the left would prefer longer waiting periods. In any event, I will stipulate that current procedures don't keep guns out of the hands of criminals, sane ones or crazy ones, and strengthening those procedures as has been suggested won't either. Nothing short of disarming the public will do that, and I am not in favor of that because the result will inevitably be that only the bad guys will have the guns. Anyway, I think the second amendment would have to be repealed before we go down that road.

As for whether I worry about being in synch with my fellow travelers on the right, I think my Goldwater/Reagan/Gingrich credentials will pass muster. By the way, I don't think the right is any different from the left in that it is pluralistic (not monolithic) on issues and positions, though there is not the rivalry within the movement that Dems like to believe is there. Unlike progressives, those of us on the right usually respect each other's opinions (and even some of the opinions we hear from the left) recognizing that intelligent people will come to different conclusions on these matters. That's what makes these debates fun and why I love to receive such great comments, like yours. Thanks Dr. C.


The bankruptcy of this administration's foreign policy approach is now being again
demonstrated by our helplessness, and lack of intelligence about what will be next for Egypt. Even though we seem to have no idea, the President has already pulled the rug out from under our long time partner Mr. Mubarak, and called for an immediate move toward a transition government. Thus, again, we give proof to the old adage, "it's dangerous to be our enemy, but downright fatal to be our friend." Watching our cynical and feckless display certainly has to raise concerns for our friends around the world, especially Israel. Just how quickly will any friend be abandoned by the U.S. under stress.

Not knowing much about how this will turn out myself, I do have two observations. First, if we could ever agree on a consistent foreign policy, as we did during the Cold War when with few exceptions, both Democratic and Republican administrations acted predictably and forcefully (we'll ignore the Carter administration for now), maybe we would be more effective. But we can't agree. When Bush 43 advocated for a policy that would spread democracy, even if it meant change from a friendly autocrat like Mubarak, he was roundly criticized for it. The Dems, when they achieved power, seemed to adopt the State Department's preferred policy of benign realpolitik, supporting stability, even if it meant backing small-time bullies like Chavez. So when the populace has finally had it with the autocrat, whether the trigger is economic or political, we wind up on the wrong side and can't back away fast enough.

Second, we are still suffering from the dismantling of the CIA as an effective intelligence gathering apparatus. Since Senator Church's hearings resulted in a toothless CIA (as opposed to the Cold War super agency it once was) we have seen a succession of intelligence failures that have won the agency a reputation rivaling the SEC. And here we are again, basically not having seen the Tunisian nor Egyptian crises coming and not having any idea what happens next.


What next for health care? Virginia has asked that the Supreme Court review the litigation on an expedited basis, which makes some sense. The pressure to do so is rising because Republican governors have finally figured out that the recent decisions give them the excuse, if not the obligation, to curtail the implementation efforts by their insurance commissioners.

No one really knows how the Court will ultimately rule, whether Kagan will recuse herself (as she should, but probably won't), and whether Congress will ultimately repeal the most offensive sections of the law. What I would like to see is what should happen constitutionally - each state should determine its own approach, which would give us 50 laboratories to see what works. We pretty well know Romneycare is not working, for example. Maybe the state that figures out that a major medical type approach is the only true insurance program that could work will win the sweepstakes.


When veteran Long Island bridge expert Harry Stappenback passed away last week at age 71, the game lost its tallest master. At 6'11", the gentle giant was a fixture at the late lamented Vanderbilt Bridge Club, and before that at New York metropolitan area tournaments. The highlight of his career was when his team won a national championship in 1987.

New York Times bridge columnist Phil Alder wrote that Harry's teammates in winning a local tournament were 6'6", 6'8", and 6'9" making them the tallest team in New York, including the Knicks.

In my last post, I noted that we had sold 100 shares of Hubbell at 56.93. We had bought them on 12/22/2000 for 23.56. On the 28th, we sold 500 shares of FSI International (FSII) at 4.43, purchased on 9/8/2009 for 1.01, a nice little gain. On the 31st, we bought 100 shares of ING Preferred (ISP) for the IRA at 20.48. On Groundhog Day, we sold 100 shares of Lindsay Corp. (LNN) from the IRA for 68.95. We paid 20 on 3/5/2001. Patience pays.

Loyal readers will no doubt recall that redwavemusings disregarded the deflation scare and mocked the Federal Reserve's concerns, worrying instead about a debasement of our currency. Since so many currencies are tied to the dollar, and since central banks around the world are pumping up their economies, a worldwide inflationary period has already started. If you factor out the retreat in housing prices from the bubble levels of 2008 and prior, you get some pretty ugly increases in the cost of commodities and living expenses. This is showing up in the prices of food, steel and other necessities around the world.

So the rise in nominal stock prices simply reflects the weakened currencies and the fact that the numbers are getting bigger, not that corporate properties are actually increasing in value. So you can't be short, you have to be long to keep up with inflation, and you have to be in commodities that hedge inflation, like gold. In sum, you have to hedge your cash positions, because the value of cash will inevitably decline.

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