AIG: O, the Irony

When a Republican administration started shoveling buckets of money into the financial system last year, it was a self-inflicted wound by the party. It’s difficult to criticize Democrats for borrow-and-spend-then-tax-and-spend when Democrats are doing what the Republicans did, albeit on a much vaster scale.

Now that Democrats are in charge, it’s their turn to build the petard on which someday they may be hoisted. In his latest example of ad hoc governing, the President wants to rescind $165 million in bonus payouts to AIG executives, many of whom are responsible for AIG's (and the country’s) financial debacle. If the Administration does find a legal way to cancel contractual salary obligations (I hold no brief for AIG, having never done business with it or been a shareholder), I can foresee a day when a Republican President, citing President Obama’s precedent, overrides the labor contracts of auto companies that receive bailout money.

If it were my choice, I’d gripe about the bonuses a lot, then pay them. The ship is going down, and a bad guy has seized one of the lifeboats. There are bigger things to worry about, so just let it go.

Ready to Roll

Not the most nutritionally correct breakfast, a buttery bagel with diced spam and eggs steels the traveler for the commute ahead. This breakfast sandwich is a favorite of the youngster and yours truly, especially on a cold winter morning. Pop the bagel in the toaster, mix the ingredients in the frying pan, and it's done in four minutes. Add a hot cuppa joe, the morning newspaper, and I’m ready to roll.

Empty Square

San Francisco Ferry Building

Pedestrian traffic is sparse this Friday morning. Liz Claiborne vacated its retail space, the bookstore is gone, and several food kiosks have closed up shop. The constant drumbeat of macroeconomic misery sensitizes us to the woes of local businesses, much as global warming makes us notice hot summer days. The tourists will return in April during spring break, and our spirits will brighten with the rising temperatures. © 2009 Stephen Yuen

The New Big Thing

Twitter is the hot Internet fad of the moment. As if we need more things to divert our attention, Twitter members are constantly commenting what they’re thinking or doing in short bursts of 140-character messages, about two lines of text on a normal-sized page. Unless they’re doing haiku, most messages (“tweets”) evidence little thought. We can receive the tweets of as many members as we care to follow, and we can spend every waking moment staring at the ever-scrolling screen on our smartphone or computer.

Sheep that I am, I had to join. Big-name movie stars, politicians, and athletes are flocking to Twitter, along with the generations that still have a full head of hair. The fear of being left behind overwhelms any guilt from spending time unproductively. Besides, it’s likely only a short term commitment; the wave of this fad will crest and break, then we’re off to the next big thing.

(This Wall Street Journal article provides, in my humble opinion, a balanced perspective, as the reporter describes the ups and downs of her experiences with the system.)

Once Was Lost Then Now Is Found

Ala Moana Park

I had often misplaced my first wedding ring (your opinions are not welcome, Dr. Freud). I finally lost it for good when it slipped off my finger swimming at Ala Moana. We searched for hours to no avail. I bought a replacement later that summer.

The second gold band lasted for 14 years until it too was lost, along with a jade ring that my grandmother gave me. The last time I saw either was when we remodeled the kitchen. I was 99% positive that the rings were somewhere in the house. The 1% uncertainty consisted of a nagging suspicion that one of our contractors had helped himself when I wasn't looking. Try as I might, I could never banish that poisonous thought completely.

I was surprised and delighted when we replaced two heavy bedroom dressers this month. Beneath the years of accumulated dust and debris lay two shiny objects. I was grateful that I had found the rings, but more importantly that my suspicions about a fellow human being were completely unfounded. Another sign that this year may turn out to be better than expected.

Start Spreading the News

The San Francisco Chronicle is advertising home subscriptions at $7.75 per week for eight weeks, sweetened by a $25 gift card from Macy’s or Safeway. At that rate, the annual cost of a home subscription is an astronomic $403.

The Chronicle is barely hanging on. In my humble opinion its best hope is to embrace the digital format as quickly as possible, and the means is finally at hand. According to one reviewer, Amazon’s improved ebook reader, the Kindle 2, heralds

the moment when the direction of our momentum changed. After years of steadily moving away from physical print, it feels as though we’ve only just now crossed that purely mathematical and symbolic waypoint and have begun moving towards a destination where we purchase all of our books and publications in the form of ebooks.

Amazon sells the Kindle for $359. Surely the business mavens at the Chronicle can work out a deal with Amazon to bundle a Kindle and a one-year subscription for, say, $399. Buyers would own hardware that would allow them to purchase over 240,000 titles, as well as the Chronicle. At that price I’d be a subscriber again. © 2009 Stephen Yuen

Laugh It Up, Fuzzballs

My first profession, accounting, is universally mocked. (I wouldn’t mind being lumped in with bankers, the current butt of jokes, if I could get their pay.) Below is the start of the conversation between Simon Constable of Dow Jones and David Gaffen of the Wall Street Journal.

SC: We’re talking accounting, but don’t fall asleep just yet because this time it’s really critical. It’s the week ahead. I’m Simon Constable joined as ever by David Gaffen. David, something big in accounting happening this week.

DG: Yes it is, if you can believe it. On Thursday the House Financial Services Committee is holding a hearing on mark-to-market accounting.

SC: Whoo-oo!

DG: Yeah, I know. Before you all fall asleep, this is that rule etc.

(Here's the video if you want to watch the whole thing.)

Not Your Grandpa's Great Depression

We had to wait for a table at the Foster City IHOP this morning. An IHOP breakfast costs more than a Mickey D's McMuffin or a Starbucks croissant, but the booth was comfortable, coffee was served in a mug, and I could browse through the Sunday paper. Our waiter cleared the plates and presented the bill promptly, the first time in memory that I felt rushed.

It's good to see local businesses doing well, and I support them as much as I can. I could have had some oatmeal at home, but it's my patriotic duty to go out and spend(shades of 9/11). Can't stuff the money in my mattress.

BSG: Nice If It Ends That Way

Suspense is building toward Battlestar Galactica’s series finale. In the spirit of "all this has happened before and will happen again," I’m hoping that this line will be spoken in the final scene.

Honey, you won’t believe the dream I just had.

Somehow I doubt that will happen.

Love That Bob

Bob Newhart is one of my favorite comedians. Last Tuesday he busted some myths on the Tonight Show:

There’s a saying in show business, as you know, “Be nice to people on the way up because you’re going to run into the same people on the way down.” They did a survey at the motion picture home, and they asked a thousand former stars, and they said you run into entirely different people on the way down than you do on the way up. So there’s little point in being nice to anyone on the way up.

Everyone knows the saying, “You can lead a horse to water but you can’t make him drink”. We found out, you can make him drink, but you should have a bat. Then they’ll do it.

All this was said in the inimitable Newhart style, with frequent Jack Benny-like pauses, the audience howling because they could see the punch line coming.

I’ve long admired Bob Newhart. He was an accountant who managed to escape the world of cubicles and ten-keys. He made it, he got out of the [green eyeshaded] ‘hood. There’s hope for me yet.

Capitalism and Freedom

(This is just a short personal note, unrelated to Milton Friedman's landmark essay.)

I once had a conversation with a finance colleague who asked what "being rich" meant to me. After the usual prefatory disclaimers about wealth and money not meaning the same thing and how money doesn't necessarily lead to happiness--look at all the miserable rich people--I proffered my view that being wealthy meant having enough to meet all present (e.g., pay off my mortgage) and future obligations (e.g., children's education, future medical bills, future living expenses). Then I would be free to work, travel, volunteer, go on cruises, read, write, play golf, go back to school....or not. Being rich, above all, meant freedom.

Since November 4, 2008 I have lost a lot of freedom. And I don't hold much hope of regaining it soon. © 2009 Stephen Yuen

Stock index declines since Inauguration.
Double the losses if you're going back to Election Day.

O Lucky Man

Despite the ethical failings of his appointees, despite an economic war plan that resembles firing bullets in all directions, despite the evaporation of trillions of dollars in private wealth, the President---our President---is a lucky man.

Think how much worse we'd feel about him if (a) the mainstream media were as critical about his 45-day performance as they would have been about a President McCain, and (b) there were a hot war (India-Pakistan, Russia-Georgia, China-Taiwan, Israel-Syria/Iran/Palestine) for him to contend with. Thanks should go to his predecessor for stanching the Iraq bleeding before turning over the keys. Otherwise our lucky President would be in over his head. © 2009 Stephen Yuen

Hoping for a Wet March

Rain is over 80% of normal at the stations closest to the Bay Area.

A wet February has lessened worries of water rationing this summer, although we’re still hoping for a wet March.

The water content of the Sierra Nevada snowpack - the backbone of the state's water supply - is about 80 percent of normal for this time of year, according to measurements of water content at several backcountry spots. That's a turnaround from a month ago, when the water content measured just 61 percent of normal after the eighth-driest January on record had the state teetering on a the edge of its worst-ever water crisis.

A 10 x 40 foot area of the back yard needs to be re-done. If dry winters persist (I’m a global warming agnostic, not an atheist), then prudence dictates we put in a deck, patio, artificial grass, or water-parsimonious shrubs. I’m crossing my fingers for a March deluge so I’ll have more landscaping options, but that’s about as likely as the Dow getting back to 14,000 in 2009. Over the next four years we’ll just have to work harder and get by with less [unless you live in the boomtown that is our nation’s capital, but that's another story].

Spring is Coming

Our town is friendly to families of all shapes and sizes. After returning to Foster City in February, ducks like to walk around our neighborhood and check out the changes.

They sit contentedly on our lawn and express their annoyance by loudly quacking as I approach with a camera. A self-preservation gene prevails, and they waddle off when I get too close. When the weather gets hotter, they'll stay in the water. Meanwhile, it's nice to see them again. Spring is coming.

Car Crashes Into A House (Reprise)

At 10 p.m. last night we heard the wailing of sirens, then saw a helicopter descend amidst the houses several blocks away. About half an hour later the helicopter rose and headed south.

Today’s news explained the unusual activity in our sleepy suburb. A young woman had sped along Edgewater Blvd. and crashed her Thunderbird into a house. Firefighters used the jaws of life to extricate her from the pancaked car, and a helicopter transported her to Stanford Hospital. Her condition has improved to serious from critical.

Fortunately, no one else was hurt. However, a support post was sufficiently damaged to cause the building to be declared uninhabitable, and the elderly resident will have to move out.

Five years ago we had seen a similar accident a block up the street. No one was home in that one, and the young man driving the car walked away. The homeowners have since built a brick-and-iron fence around their property.

Edgewater Blvd. seems safe enough to me at the speed limit of 40 mph (25 while school is in session), but parents whose kids attend the two nearby schools may beg to differ. The City will probably increase police patrols and install four-way stop signs or speed bumps to slow drivers down. Traffic restrictions, like artery plaque, build up and are rarely reversed.

The accident in 2004.