Minting money off poverty

This is the name of a heart-wrenching article over on MSN Money. Check it out here.

It's basically a bunch of stories of people who, once down on their luck, had only credit-card companies to turn to for help in getting through the day. It's extremely sad because these people come off as having no other choice but to go into debt to keep living day to day.

I should also note hear that, even though I haven't reviewed it, the topic of personal debt and how credit-card companies do their business should watch Max'd Out, a documentary about debt and how people get fucked over once they start in on that slippery slope without understanding the terms.

One thing I did notice about the stories in the article is that most of these people had a strike against them before debt started to screw them over. Most of them already had several children from a very young age. They were already on the brink, and then debt simply nudged them over the edge.

Cliche as it may be, this all goes back to education and the lack of it at the school level. Kids should be warned and protected from this kind of stuff, especially low-income kids. They simply won't be able to afford making mistakes like these. In college, I had a bunch of friends that probably went into credit-card debt and once they figured out how deep they were, probably just got scolded from their parents, who promptly paid it off, and then kept right on living. No sweat. That's how they learn about credit.

But if you don't have the money to learn the hard way, you enter into indentured servitude and wind up working the rest of your life to pay back all the interest and late charges. It's crazy.

One thing you have to listen to about Robert Kiyosaki is his point on educating young people in schools about financial matters. Why doesn't it happen?

As you read the article you'll realize that education in a more general sense is what's missing here.

Review—Sicko

Who’s in it? Michael Moore sans 50 pounds.
Whoa whoa whoa, isn’t he totally one sided? Yes.
So why even watch it? Because the issue is important—it’s our health that is on the line here. Our lives, really.
So what’s the deal? Our health-care system is run by for-profit companies, which means the people in charge answer to two things: the bottom line and shareholders. This creates a conflict of interest as insurance companies want to maximize their profits as much as possible. Which is fine, they are a private company—that’s their job.
What’s his point? That everyone should be able to be cared for, no matter what insurance you do or don’t have, no matter what excuses an insurance company gives you.
Any crying? Yes, in Cuba. It’s unfortunate what Moore does here—he makes us cry and he makes us angry. Is he manipulating us? Sure. Are the tears warranted? Yes. Is he fooling us into being on “his side” of the issue? No. The system is broken and he’s pointing at the deficiencies with a huge red arrow so that we recognize the problems. Is it that simple? No, but he’s not looking to be a neutral, 6 o’clock news story. There is an urgency in his message.
What scares me: Besides getting seriously sick and having my insurance decline coverage for bullshit reasons, the fact that Moore’s movies are the perfect recipe for inciting rage, fears, CHANGE. I mean, unless you’re a real heartless bastard (or a Republican in the case of Fahrenheit 9/11), then his movies have to make you angry. Why is the gun issue so fucked up in this country? Are we going to put up with the kind of shit the Bush administration has done vis a vis Iraq and 9/11? Are we satisfied being bullied around by insurance companies when it comes to our lives, our health, and our livelihood? What scares me is that his previous movies did their job—they pushed the right buttons for people more aware of politics, but that was it. This movie should cause massive change. Should shock people into demanding change. History shows that the furor over this movie will be at an all-time high, and then it will go away. Why? A lot of money is at stake for a lot of powerful people (God, how cliche and “alternative wannabe” that sounds—I’m really not though).
The Obama connection: When I started paying attention to Obama’s campaign talking points, I realized his main issue was going to be health care (this is after Iraq—every hopeful’s #1 issue), more specifically: universal health care. Then I saw the release date for this movie and it hit me: Obama is a smart man. He’s been shouting universal health care for months and, if Moore’s movies provide an accurate track record, universal health care will be on everyone’s mind when this movie blows up later this month. Obama will have the necessary ammo to overtake Hillary. Obama won’t “endorse” the movie or anything crazy like that—Moore is too far out there for that—but still.
Why Hillary? You’ll see in the movie how sassy she was back in Clonton’s day—she was Mrs Universal Health Care. She fought the big wigs. Then they bought her out and she has become the second highest person receiving contributions from the health-care industry. This will be a huge talking point come election time.
Where to live then? Cuba, Canada, England, or France. The look at France is especially intriguing. The group of Americans who now live over there feel guilty as hell that they only have to work 35 hours a week, get five weeks off paid vacation, and pay absolutely nothing for all medical care (I looked this up and they actually have 85% covered by the government). Canadians are priceless: they are like “Pay? No, no, no, it’s free.” They just can’t comprehend the for-profit system. The idea of paying for health care is something that just doesn’t compute with them. And yes I know this is all very one sided and bias and all, but still.
Bottom line: This is a fucked up system. Hopefully the movie can jump start the debate on the issue and the actual movie can be put aside. It’s like driving to an environmental rally in a hummer—yeah, it may be a little controversial, but it gets you there so you can try to change things. The end justifies the means here. And if Moore needed to be one sided or a little snarky to get me pissed off and outraged about the way it all works, so be it. The bottom line is we need to get universal health care.
Post Office connection: It’s state sponsored, government run, whatever. The point is it’s not a for-profit, private company. I remember people were complaining about how slow their mail was or something and about possibly privatizing it. Someone pointed out that, if you did that, you would see what cost you 42 cents before would cost $4. It’s what would be needed to make it profitable. And that’s our freakin mail, people. Our mail is more important?
Full Disclosure: I wrote this review a few days ago and now that I’m rereading it I realize how converted I come across, how thoroughly convinced and on Moore’s side. It’s a strong movie like that, it has that power to just plain old convert you. Good or bad? Who knows, but the idea here is that it get people talking about the issue. This is Moore’s saving grace: people become aware of a very important/interesting issue.

Review: A Random Walk Down Wall Street, by Richard Malkiel

Topic: Investing, stocks.
Recommended: My friend Matt is getting an MBA at the University of Chicago, so I've been wanting to kind of follow along and try to get a preview of that is like in case I ever decide to do it (get an MBA). So for one of his classes a professor assigned this book, along with Stocks for the Long Run, calling them both "essential" reads.
So it's a stock book, is it an easy read as a business school book? It's an easy read, really. The question isn't about easy but more about what you know and don't know. If you know this topic already well then you'll skip a lot of it because it gets repetitive.
Will it make me rich? Maybe, I'll let you know. Turns out the gist of the book is something I'm already doing with my own investments, so he's kind of preaching to the choir.
Gist: Over the long run, nothing can compete with a properly allocated portfolio of index finds exposed to the following markets: REITs, international stocks, US stocks (especially small caps), and bonds. That, folks, sums up the 400ish pages in this book. If that first sentence doesn't mean anything to you, and you're interested in a safe, easy, if boring way to invest in the long term, then this is the book for you. It lays everything out and explains what you need to know. I wish I would have read this back when I started.
Other books to read with it: Beating the Street, by BC grad Peter Lynch. BC what! This one is more entertaining, less academic, and just as informative. But Malkiel's book is more of a recipe book, giving you everything you need to actually go and do all of this in the real world.
How this book argues its point: By bringing down (or simply disproving) every other investment strategy out there. But still, it gets kind of annoying when he rags on everything under the sun for 350 pages, then FINALLY gets to his point.
How many pages the cliff notes version would be: Forty pages. Ten for a quick overview of everything that doesn't work (down from 360), twenty for the strategy he supports (also twenty in the book), and ten for the resources he includes at the end, which are super helpful and include the actual index funds out there to put the strategy into practice.
Full disclosure: He tells you he is connected to Vanguard, but gives you other, non-Vanguard options. Which is fine since Vanguard is probably the best place to buy a varied set of cheap index funds.
One thing he kind of sidesteps, kind of: Warren Buffett. Granted, I'm a huge Buffett fan, and he's mostly right that, for the average Joe, WB's performance just isn’t going to happen. But he's so adamant about bringing down all active stock-picking strategies (including value investing, which is pretty much WB). And he gives reasons. He does admit that Lynch beat the street for a while, but then quit. He brings up Buffett a lot, but kind of avoids any explanation of how WB is, was, and continues to beat the odds. He says value investing is not possible, that the market is too efficient for that. OK, I'll accept that (though I disagree to some extent). But you can't say that and then acknowledge WB's incredible record (which he can't say anything negative about and doesn't, I mean it's Warren freakin' Buffett!) but doesn't try to explain that, if value investing can't be successful long term, then how do we reconcile what WB has done?
But . . . Part of me knows it's probably best to leave that as is. The average person (and even super investor managers) simply can't do what WB has done. He's an anomaly, a freak—not because of luck. It's ability. Kind of like expecting people to do what Pedro Martinez or Greg Maddux does. It's just not gonna happen. In terms of the book, if 10 million people were flipping coins for the past 50 years, Buffett is the one guy who has thrown nothing but heads. . . still.
Final Word: Great if you want a beginner's look at everything people have tried and doesn't work. Could be a LOT shorter.
Up Next: Liar’s Poker, by Michael Lewis (of Moneyball fame).

Mad Men

With all the reality-show craze, I always thought it would be interesting if there was a show where young copywriters and designers competed to try to get a prestigious position at a prestigious agency.

Well, I would watch it.

But for now this will have to do.

Great Obama article in the Chicago Tribune

Check it out here, it tells the story of how he and his people decided that now, and not in 4 or 8 years, was the time to run for president.

Wireless Electricity= Wiitricity?

I love this topic, it's something I've wondered and fantasized about ever since college. Can you imagine no more wires? No more batteries? The possibilities . . .

Well, this may be a viable way of doing it and I can't wait until it evolves.

Evolution and Creationism

This is a classic example of ignorance. That people can believe two ideas so incompatible with each other can only mean they don't know exactly what it is they're opining on.

DFW in Italy

Here is a nice collection of new David Foster Wallace stuff. There is a short excerpt from something new he's not even close to finishing, as well as some short videos of an interview.

I especially like the video where he talks about feeling like a baby in Italy because he can't interact, he doesn't understand, he's basically a baby but in an interesting way.

It's also painfully obvious how self aware he is about how he's coming across and what he's saying. He's thinking ahead like three or four sentences at a time. Vintage DFW.

Obama, Health Care, and Michael Moore

Obama is a smart guy. If Michael Moore's next movie, Sicko, which criticizes the US health-care system, has anywhere near the effect that his last movie did, then this will be the hot-button issue after Iraq in the upcoming presidential election.

Try to go back and remember what it was like when Fahrenheit 9/11 came out—not only did it make tons of money, it got everyone talking about the failures of the Bush administration as well as some rather shadowy stuff that happened surrounding 9/11.

Put the two together—the movie comes out on June 29 and Obama has been making this his secondary issue (everything will be secondary to Iraq in this campaign) for a while now, as he campaigns for universal health care.

Anyway, here is an article that kind of links them together. It's nice to see something on the news after you've thought it out and considered it as a rather plausible idea.

This issue, and the effect the movie has on voters, could catapult Obama past Hillary Clinton in the Democratic primary.

Like I said, Obama is a smart man.

Speaking of Obama, I like the way he answered this question in Sunday's debate. While most of the candidates gave BS answers (and I'm sure many took Obama's answer for the same) to the question of whether English should be the official language of the US, he replied:

Sens. Barack Obama, D-Ill., and Chris Dodd, D-Conn., saw the question for what it was and refused to answer. Obama said that "this is the kind of question that is designed precisely to divide us" and urged his colleagues to instead refocus their attention on coming up with a legal and sensible immigration policy. When the immigration debate gets sidetracked by such questions, Obama said, "we do a disservice to the American people."

He isn't just BSing about the unity thing, he's really serious about it. I want this man as my president, especially since there is nothing worth voting for in Guatemala.

Best manager tantrum ever

Check out this video of a manager in AA ball going nuts.

Kerry Wood Article in NY Times

Here's a great article talking about my favorite baseball player, Kerry Wood, and all his trouble and travails with his arm injuries.

Written by the guy who wrote Friday Night Lights and Three Nights in August.