The Bostonians

The week of Thanksgiving we did a few compulsatory Boston activities:

Visited the Patriots Hall of Fame at Gillette Stadium.



City view from the top of the Custom House

Make way for those ducklings. They aren't really ducklings anymore...

Christmas is here

No, I can not acknowledge Christmas before Thanksgiving is over, unlike most of the retail outlets of this country these days.

We picked out our tree in October, and cut it down December 3rd, and put it up Dec 4th.

1927-2011

Sadly, I write that my Dad passed away Early Friday morning [Nov 18]. I flew to Boston Tuesday night when it was clear the end was near. As a family, we had a great 4 days with him in October when he was still highly functional. See my facebook profile, that was taken the last day.

On Wednesday, all 5 kids were there and he was pretty cognitive and we all had or chances to speak. By Thursday, he was mostly out of it and clearly struggling. He passed a 4am with my Mom at his side.

His last words, with most of us there, were to his beloved hospice nurse, who asked how he was. He responded, ok...with faith. Touching and fitting.

Link

Thomas A. Moore, 84
November 19, 2011

SOUTH YARMOUTH — Thomas A. Moore of South Yarmouth, formerly of Waban, died November 18, 2011, at the age of 84. Beloved husband of Mary L. (DeRusha) Moore for 60 years.

Devoted father of Thomas A. Moore Jr. and his wife Sylvie Martin-Moore of South Yarmouth. Paul G. Moore and his wife Donna Gerhauser of Scotch Plains, N.J., Mary A. Hurley and her husband Paul of Naples, Maine, Daniel J. Moore and his wife Fiona of Needham and William H. Moore and his wife Alison of Mound, Minn.

Brother of Ralph Moore of Murphy, N.C., Catherine Carlin of Springfield and the late William Moore and Claire Oppel.

Loving grandfather of 9 grandchildren. Also survived by many nieces and nephews.

Late retired treasurer of William Carter Company of Needham. Former trustee of Carroll Center for the Blind. He received his BA from Boston University and MBA from Babson College. WWII Navy veteran.

Expressions of sympathy may be made in Thomas' memory to the YMCA Campus, Burgess and Hayward Scholarship Fund, 79 Coddington St. Quincy, MA 02169.

Open letter to Thomas A. Moore, Sr.

Dear Dad,

I sit here a thousand miles away a full year younger than the age you were when you had me. That thought is mind boggling to me as I reflect over the last 42 years. There aren't many who are given the chance, nay - the opportunty, to say thank you to the ones that have loved them their whole lives. And with that I say, thank you.

I am proud of who I have become in what is hopefully my mid-life. But a large degree of the credit is yours. I am the man, the husband, the father that I am because of my respect and admiration of you. Your dedication to our family, your faith, your constant support of me individually are all idol worthy.

Today is Veterans Day, and I can't help but recall your early patriotic call. Too young, in theory, to serve in the WWII effort didn't stop you from packing your things (or just a toothbrush, if I recall the story correctly) and joining the Navy. "Dinty" Moore may not have made it out of the Carribbean due to the war's end, but your dedication to serve demontrates the value of honor in life.

Unlike many people today, you worked at the same company my entire life. You had a daily routine that showed dedication and consistency. As a small child, I loved visiting your office. You were respected and influential. I can vividly recall one specific day when I was sitting in your office and you were on the phone working with the banks moving millions of dollars around to fund your company's business with a single phone call. That was a day where I looked at the man behind the desk and said - I want to do this, and finance became my calling.

Your work ethic was instilled in me early. I understood the value of a dollar, and the value of education. By the sixth grade I struggled in the less than structured public education system. Despite having left the hardship of just putting the education expenses of three other private school tuitions behind you, you recommitted to sending me to private school. Although not my favorite decision at the time, it's the one individual decision that probably most shapped the rest of my life. Although it wasn't much in the scheme of things, you required me to commit 50% of every dollar I earned from the time I was 12 to go towards my own education. I may have hated turning over all those Christmas tips from the paper route, and it probably contributed to the value of only a few textbooks, but it created something in me that lasted a lifetime.

Work wasn't the most important thing in your life by any stretch. Despite your tireless dedication to your work, you made it home for supper each night. Maybe its more legend than reality, but it's a feat that still amazes me to this day. You drove me to school every day. You made basketball games and cross country meets. We attended scores of great sporting events together, and had vacation moments that I will always treasure.

Throughout life your steady, quiet nature was a subtle, but driving force. I may not share your calm level-headedness, but such a temperment was reassuring. If you were mad, I knew it and learned from it. It was a stable environment that fostered being both inquisitive and opinionated, yet tolerant. Your faith was a guiding force throughout that, and your love of God and the Church were heartening. The way you have handled the last few months has been inspiring. I can not imagine a more honorable and healthy way. Your amazing dedication to assisting Mom in the face of your own battle is worthy of story telling. But being the centerpoint of the story is not you. You view it as your humanly duty, just like you did the day you left Springfield with just the toothbrush. You've raised a family that understands the need to care for each other, and understand that what you view as your duty will dutifully be carried on.

I am lucky to have thousands of lasting great memories of our time together, and even further lucky to have zero bad ones. I was unfortunate not to know either of my grandfathers. In earlier years, as health waxed and waned, I worried my children would not know some of theirs. Thankfully that is not the case. You have created wonderful memories for them as well - and for that we are all lucky.

May God be with you,

Your loving son,
Bill

Movember

November (a.k.a Mo-vember for people who grow mustaches in respect for mens health issues) is Pancreatic Cancer Awareness month. Get aware. But then again its also Native American Heritage Month, COPD Awareness month, National Novel Writing Month, Alzheimer's Disease Awareness Month, American Diabetes Month, Lung Cancer Awareness Month, National Homeless Youth Awareness Month, Crohn's & Ulcerative Colitis Awareness Month, National Pomegranate Month, and International Drum Month - so you might be busy.

Mobility

I've posted numerous times about the flaws in income inequality analyses. Most assume that people stay at the same income level. Particularly, it assumes that the same 1% are always making the most money. When they aren't. Just one stat from teh exhibit below - 5% of those in the top quartile were in the LOWEST quartile six years later, while 2% in the lowest quartile were in the top. Here is someone else's take:

From Carpe Diem:
We hear a lot these days about "increasing income inequality" and "stagnating household income," but those discussions rarely include what is probably the most important factor when it comes to income over time: income mobility. In fact, even if: a) income inequality was increasing over time, and b) median household income was stagnant over time, those outcomes wouldn't necessarily be a problem if there was significant income mobility. Reason? If there is substantial movement of households over time from lower-income to higher-income quintiles, households may only be earning the median household income for a short period of time on their way up to a higher quintile.



In other words, it's more likely that most households are "typical" or at the "median" level" only temporarily on their way to a higher income group. The fact that median household income might be stagnant over time seems far less important than what happens as households exceed median income and move up to a higher-income category. In the case of significant income mobility over time, wouldn't households actually benefit from increasing income inequality over time if that allowed them to earn higher incomes relative to the median or low-income quintiles once they arrived at one of the top two quintiles?

Most of those complaining about income inequality and stagnating income seem to statically assume that households or individuals stay in the same income group (by quintile, or the "top 1%," "top 10%," bottom 50%, median income, etc.) forever, with no movement over time. If we assume that you're stuck in the bottom income quintile for life, or even earn the median household income for life (both highly unrealistic), then the concerns about rising income inequality or stagnating median household income have greater strength. But with dynamic movement over time in the income of households and individuals, the "problems" of income inequality and stagnating income seem much less important, and might even be "non-problems."

Thomas Sowell offers this key insight (emphasis added):

“Only by focusing on the income brackets, instead of the actual people moving between those brackets, have the intelligentsia been able to verbally create a "problem" for which a "solution" is necessary. They have created a powerful vision of "classes" with "disparities" and "inequities" in income, caused by "barriers" created by "society." But the routine rise of millions of people out of the lowest quintile over time makes a mockery of the "barriers" assumed by many, if not most, of the intelligentsia.”

Contrary to prevailing public opinion that households get stuck at a given income level for decades or generations, there is strong empirical evidence that households actually move up and down the economic ladder over even very short periods of time.

For example, recent research from the Federal Reserve Bank of Minneapolis is summarized in the table above, based on income data from the Panel Study of Income Dynamics that followed the same households from 2001 to 2007. The empirical results answer the question: For households that started in a given earnings quintile (20 percent group) in 2001, what percentage of those households moved to a different income quintile over the next six years? Short answer: a lot.

Cape Cod Beachs ARE open!

Cape Cod is October is hardly the same as Cape Cod in July, but it's still Cape Cod. The kids had three days off school for teacher conferences, so we decided to visit family. Unfortunately, Sundae School was closed, but technically the beaches were still open.





The first day absolutely poured, but each subsequent day was better. The benefit of the bad early weather was "waves." We hit the East Coast of the Cape at Nauset Beach. The girls bodyboarded, and I tried my hand at surfing. With all the wake surfing I've done this summer, I know I can control a board once I'm up. However, getting up is more than half the battle. I didn't catch one wave standing up.









But we enjoyed ourselves nevertheless.

Occupy This!

Oh, you “Occupiers” love a good story or theme, even if it’s complete BS.

Let’s look at how “Wall Street” or “Big Banks” have destroyed the economy.

The protesters and resulting media outlets like to discuss how the “99%ers” bailed out Wall Street and it cost us so much. Let’s set the facts straight. As per the NY Times, $550bn was committed in TARP funds to “bail out the banks.” $175mm was used for banking institutions. Of all the “Big Banks,” not only was the money returned, but the Treasury MADE Money on the transaction. In fact, in April 2009, a number of financial institutions TRIED to repay the TARP loans and were denied by the Obama administration. However, starting later in 2009, banks began repaying the funds. For example, Bank of America, which received $45bn, paid back the $45mm and paid $3bn in interest, or a 6.67% absolute return – well above the rate they borrow money from the Federal Reserve. Additionally, BofA had to grant Treasury warrants which they sold to “Wall Street.” As per the Washington Post, “The Treasury Department said Thursday that it sold its warrants to buy Bank of America stock for $1.54 billion, fetching a much higher price than what market analysts and federal officials expected.”

In August 2009, Slate wrote this, “As we approach the one-year anniversary of the Panic of 2008, it's clear that the actual cost of the TARP will be a fraction of the original $700 billion estimate and that taxpayers are even turning a profit from the central component of the package.” Less than a month later, the NY Times wrote, “Even as voters rage and candidates put up ads against government bailouts, the reviled mother of them all — the $700 billion lifeline to banks, insurance and auto companies — will expire after Sunday at a fraction of that cost, and could conceivably earn taxpayers a profit.”

The banks that have not yet repaid TARP – mostly local community banks – hardly would be classified as “Fat Cats,” but rather George Baileys (or at least the modern versions).

The Treasury wasn’t alone in its bailout funds. The Fed acted in a number of capacities also to stabilize markets. I haven’t tracked it closely, buy in the fiscal year 2009, they made a profit of $45bn on their stabilizing activities. I can only imagine they made more in 2010.

Yet, TARP will likely lose money and cost the taxpayers billions. The source of that loss, the bailout of GM and Chrysler – An action the Bush administration opposed, but the Obama administration approved. Per CNN, GM and Chrysler received $80bn in TARP funds. How much has been paid back? $2.1bn. Instead, the US government owns 32% of GM, which in total is worth only $37bn at today’s prices. Chrysler went bankrupt. I don’t see anyone hanging signs at plants in Michigan asking for the scalps of Detroit’s finest businessmen.

Did a number banks play a role in the actions that lead to the actual need for TARP? – sure. Were they sinister and evil-minded in general? – hardly. Were there bad apples that used shady practices? – Always and everywhere. Were they the only ones, or even the root cause? – No. Was “Main Street” caught up in a greed bubble as it related to housing? – A wholehearted YES. Were some of those practices created in “Washington?” – Absolutely.

I won’t get into all of it here, but read what I wrote in 2008:
Low interest rates and easily available, cheap corporate credit were allowing companies (even ones with shaky balance sheets) to refinance and borrow at low rates. Stock valuations were high, and returns on bonds were quite low. On top of that, low volatility in the market reduced risk premiums on traditionally risky investments. Basically, proper returns on investments were becoming harder and harder to come by. Traditional institutional investors (pension funds, mutual funds, endowments, banks and hedge funds) sought new ways to improve their returns. It can be accomplished two ways: leverage or increase risk - or a combination of both.

Wall Street, as it always has, stepped up to create products that were in high demand. They expounded upon an idea called securitization. Essentially, a securitization pools a bunch of assets together and chops them up into different tranches. The theory involves a diversification risk. The highest tranches are the safest in that they take the last losses. It was a huge hit - higher returns from riskier assets but with less risk. Wall Street firms repackaged all kinds of assets: home mortgages, commerical mortgages, high yield bonds, investment grade bonds, airplane leases, etc. Wall Street was the conduit, not the originator. These firms are underwriting the securities on behalf of other institutions including the government sponsored entities, Fannie Mae and Freddie Mac. I don't want to blast the securitization process completely. Securitizations work - they provide higher returns with less risk if held through maturity. ..

Investors, seeking higher yields, were not only gobbling up these securitized bonds under the impression they couldn't lose, but they were suplementing their returns by adding leverage (using borrowed money to purchase securities). Those with the best cost of capital yielded the greatest advantage in these securities…

Bubbles and Panics are systematic problems. Wall Street is not without fault, but this is not a "Wall Street Fat Cat"-created problem. It began with the average American, was fueled by Congress mandating a need to subsidize low income home ownership, and its subsequent risks were highly underestimated by investors who were seeking better return for their institutional clients, who collect and allocate money for average Americans.

(http://sonofthelama.blogspot.com/2008/10/politico-b-s.html)

The systematic housing bubble used a willing Wall Street as the vehicle to propagate itself, but it was fed by everyday people, all across the country.

As noted in the Wall Street Journal today by Peter Wallison, one of the government’s Financial Crisis Inquiry Commission members, “the narrative that came out of these events—largely propagated by government officials and accepted by a credulous media—was that the private sector's greed and risk-taking caused the financial crisis and the government's policies were not responsible. This narrative stimulated the punitive Dodd-Frank Act—fittingly named after Congress's two key supporters of the government's destructive housing policies. It also gave us the occupiers of Wall Street.”

If any of these “occupiers” think JP Morgan, Citibank or Bank of America is responsible for their problems now, they are sorely mistaken. The fact that they have student loans they can’t afford, or don’t have high paying jobs being thrown at them, is not the fault of these institutions. “Wall Street” does not determine higher education tuitions. If anything, these institutions make getting student loans viable. “Wall Street” doesn’t determine who gets a job. If anything, they provide capital to the economy that allows companies to have funds for which to grow and expand and thus CREATE jobs. Every one of those “Occupiers” has a cell phone, an iPod, a digital camera, a social media account and pumped-up kicks that were each created because we have a capitalist system that finances those companies and allows them to grow. Additionally, those “Wall Street” banks are creating and managing mutual funds and 401(k)s by identifying the right investments and putting money to work so that when Social Security completely collapses under its own weight, today’s workers won’t be destitute.

History doesn’t repeat, it rhymes. The individual John Pierpont Morgan (JP, himself) was demonized in the late 1890s, early 1900s. He was rich and envied. He was accused of market manipulation because he dominated corporate finance. At the height of Morgan's career during the early 1900s, he and his partners had financial investments in many large corporations and were accused by critics of controlling the nation's high finance. In both 1895 and 1907, the U.S. was struck by panics almost crippling the American economy. Major New York banks were on the verge of bankruptcy and there was no mechanism to rescue them. Historians have attributed the actions by J.P. Morgan personally as what saved the market and the economy. However, that never stopped enemies of finance from publicly flogging him and his business. In 1912, he was berratted in front on Congress. In 1920, a group of financial anarchists blew up a bomb on Wall Street loaded with 100 pounds of dynamite and 500 pounds of cast- iron slugs in front of J.P. Morgan headquarters. The bomb was aimed at the financial institutions related to postwar social unrest, labor struggles and anti-capitalist agitation in the United States. Thanks for keeping the industrial revolution alive – here’s a bomb for ya!

It was wrong in 1920 and still is today. Yet today we still blame “Finance” for our problems. The world, and Europe in particular, is gasping because governments spent beyond their means. Social programs, welfare states, giving away better jobs because people “deserved it,” state mandated wages and inflations were funded with debt that many of these countries could not reasonably afford. If we follow the path that many of these “Occupiers” espouse, we’ll be right behind Europe.

They should look to Washington as to where their tax dollars are being spent. If they think “green jobs” and tax rebates are getting the country back to work – by all means, keep supporting it. If they think robbing the “rich” is going to grow GDP and stimulate the creation of new jobs – by all means, fight for it. It’s wrong, but at least it’s a rationale discussion.

I saw a shirt today with a slogan that I now love. I could agree with you, but then we’d both be wrong.

Blinded me with Science!

Katie's science project - An oxygen molecule.

Pics

Fall is upon us

You mean you haven't picked out your Christmas tree yet?

Morning Surf Club

The season is winding down, but three of the four unofficial members of the morning surf club took to the waves Sunday morning. I took Katie and Emily along. Dave, the patriarch of this surfing group, is the one who is perfecting the paddle-in. Brian, the jet-setting executive, needs to pick his spots to practice, but is perfecting the Stand-Up Board. Finally, I make an appearance on the smaller board. Johnny, our regular fourth, was doing what he does best - partying up at a Wedding in San Diego :)

This video says "A Moore Production" at the end, and it truly was. Katie did all the videography, and I edited it together.

Soccer

Pic from one of the other parents at Katie's soccer game.

Gas and Oil

I had a discussion with someone about this a few weeks ago. They were arguing that "big oil" was skimming off the consumer because when oil rose, the price of gas rose, but when oil fell, the price of gas wasn't.

Here's the problem, and thus the falacy. The U.S. news media (financial media as well as main stream) quote the price of oil based on West Texas Intermediate Crude (WTI). However, less than 20% of U.S. refiners and distributors have product based off WTI. Rather, most of the world, and much of the U.S. receive product based off Brent Crude. There has been a large divergence of Brent and WTI over the last two years (+/-) that is related specifically to an oversupply of product in a place called Cushing, OK. Financial contracts on WTI oil are settled in oil located at these storage facilities. Becuase there has been too much supply at these local storage facilities in Oklahoma, "the price of oil" has declined. However, Brent hasn't seen the same decline. New world demand for oil has outpaced supply, and thus Brent prices are not down nearly as much.

If you look at the following graph, note how NY gas prices have moved lock step with Brent Crude prices over the past year, whereas WTI has declined significantly.

Sunset on the Lake

As the summer comes to a close, it is appropriate that I post some recent photos of Lake Minnetonka sunsets. [sigh]

Jealous?

Katie's Birthday

It was busy days surrounding Katie's birthday, so we spread it around. Rather than a party, she had five friends over for swimming, tubing, and a camp out in the backyard. We had her birthday dinner on the Sunday before her birthday at the Cheesecake Factory (her choice), but saved the cheesecake birthday cake for the day of - 30th Anniversary Cake, for anyone who cares - it was delicious.

Irony, n.

Irony, n. - A combination of circumstances or a result that is the opposite of what is or might be expected or considered appropriate.

The following is a list of tax breaks that will be ended or limited to pay for the jobs bill, according to the White House:

- Limit on itemized deductions ($200,000 individuals, $250,000 families)
- Carried interest would be treated as "ordinary income" rather than at capital-gains rate
- Oil- and gas-company tax breaks
- Corporate-jet depreciation would change


Mr. Obama's plan will end about $467 billion of tax breaks over 10 years, said White House Office of Management and Budget Director Jack Lew. The president has previously proposed ending the tax breaks, but has faced stiff resistance from Republicans. … The White House disputed the notion that raising taxes on the wealthy would hurt growth. The measures to pay for spending "are spread out so that there aren't negative impacts," said White House press secretary Jay Carney. … Mr. Lew said he thinks most Americans would easily end tax breaks for oil and gas companies and hedge-fund managers to spur growth. … "That is not a hard choice for most Americans, if the choice is creating, you know, economic growth and jobs, or tolerating the results of many years of inequities in the tax code," Mr. Lew said.


I think we ought to end tax breaks on White House Budget Directors. I think most Americans would support that. I also think most Americans would support tax increases that don’t raise their own taxes.


"This is the bill that Congress needs to pass—no games, no politics, no delays,"

President Obama said without hinting at the slightest bit of irony:

The White House is also taking a gamble that Republicans are willing to budge on taxes after getting bruised, politically, over a tough budget fight in the summer. … By choosing to end the tax breaks, the White House is likely setting itself up for a fight with Republicans. Over the summer, Republicans said they wouldn't end tax breaks amid concerns doing so as the U.S. is coming out of a recession would hamper the recovery.

180 Complete

You've seen the epic 180 fail video. Here's the follow up:

That's sum drawing...

We attended the great Minnesota Get Together, a.k.a. the Minnesota State Fair on Sunday. It's always quite a spectacle. This year's Fair had a unique twist for us. Each of the girls' school's art department submitted a drawing to be judged at the Fair. We received notification that each of them had won a ribbon. Items from across the state were displayed in trophy cases inside the Education pavilion.



Emily won a Third Grade - 1st place ribbon for her drawing of a futuristic city.



Katie won a third place ribbon for fifth graders for her skeleton drawing.


As you can see, there are five skeletons each painting a picture.

Both drawings were at an awkward angle inside the case. However, the girls will get their picture back (plus the ribbon), and I will take a better picture at that time.

Other fun stuff at the Fair including seeing a new born calf, and eating things on a stick - Emily has Pizza on a stick, and Katie was Big Fat Bacon on a stick.