A few years ago, I wrote an account of my experience with an investment firm. At the beginning of August, I had the great pleasure to speak to the debate over the economy and in that post, I referenced the role investment firms were attempting to play in the discussion. I called the greater lot of them in-credible. They’re credibility has now again become a topic for discussion thanks to Standard & Poor’s. Now, EVERYONE is rightfully calling them in-credible.

Before I jump into the details regarding Standard & Poor’s, I want to post what I wrote about one firm a few years back:


I've always had this fascination with business news. I know. But, only at the end of my television career was I able to realize that fascination on a full-time basis. And I must say, I did begin to develop a strong sense of The Street, in no time flat. Which begged the question, who are these market analysts/experts and why do they think they have the MARKET cornered on street knowledge? They're just guessing like the rest of us, so, what gives? Enter a recent experience I had that, 1) reminded me to revisit that question and 2) tested the validity of a popular cliche'.

His name was Seth. Seth is a financial adviser for Charles Schwab. I recently opened a brokerage account and naturally, had some questions before making any investments. After speaking with several Charles Schwab employees, I was not so convinced they knew more than I did about the stock game, so, I continued up the ladder of knowledge, eventually getting to... Seth. Left Seth a message. Seth called back. After a minute or two going back and forth about whether my new account could function as I intended it to function with Seth avoiding saying YES or NO, I decided to move on to the real meat of the conversation - the mutual fund. I asked Seth about several mutual funds to which he said, "Well, now, you're asking about two different things. One is an index fund and the other is a fully managed fund - they're like apples and oranges." No they're not. It's a mutual fund Seth. Last time I checked, a mutual fund was a mutual fund. Whether a person is keeping track of it for me or not doesn’t change the fact that it’s a mutual fund. And apples and oranges are both fruit. So I said to Seth, "There is no reason I can't look at the characteristics of each fund, weight the options and decide which one works best for me - managed or not." It's called thinking outside the box, Seth. But, i've had this experience with other financial types. Had Seth focused on outlining the few things that differ between index and fully managed funds, like the cost factor, we may have had a bit more to talk about.

The same should be the case for apples and oranges. What are the characteristics of apples and oranges? Let's see, they both grow on trees... they both have a peel... both have seeds... both packed full of vitamin c... you can make juice from both... so what's so different about them? One's red, one's orange. Wouldn't apples to chicken be a more drastic comparison? Or oranges to crackers?

The point is this: the stock market is not brain surgery. In an attempt to give himself some value, Seth has been groomed to try to turn his profession into something only few can figure out. But, in reality, the markets are such that, any intelligent person who spends consistent time following them can get the patterns and become an expert. This does not take long. Brain surgery on the other hand; please spend years - YEARS honing that skill. And practice on ground beef or something.

So, I am no more informed about the best option for a mutual fund with Charles Schwab now than I was before I talked to Seth. Point proven. But, I did successfully put into question a long standing cliche'. Now, the next time someone tries to throw you off with the apples vs. oranges bit, pause, then say, "It's all just fruit."


Now, I’ve had my Schwab account for a number of years now and have been happy with it. Haven’t talked with Seth again - could be why I remain happy. I’m gonna blame that bad advice/experience on SETH. I can only hope he has a better understanding of what clients need to hear and how to explain a mutual fund.

I use this experience as an example that the proportion of good advice you can get from The Street in relation to the bad advice could be as high as 50/50. Learn as much as you can before you seek advice and always get a second opinion. Now that i’ve said that, here’s why...

Standard & Poor’s is a joke. There was a time when they were above reproach. But, in the last few years, they’ve just made some judgment calls that remain questionable. Now, its one thing to make a call about downgrading a private business, but, they’ve downgraded a number of cities in the U.S. and also a few countries. I think that’s where it starts to get sticky. Not sure about there rationale, but, my thought is that they just wanted to stand out more? Well, they’re standing out alright...

Moody’s reconfirmed the U.S. AAA credit rating and so did Fitch. 2 out of 3 is a majority. I’ve seen numerous pundits, government officials, investment experts, etc. condemn the downgrade and none of the aforementioned confirm or cosign it.

Worse than that is the non-relevant hit the U.S. downgrade has taken on consumer confidence. Fine, when consumers see the people in the pit on the floor of the stock exchange being frantic and the Dow Jones fluctuates so violently the way it has, they think our economy is tanking. Actually, what you see is a lot of activity contained in a bubble. When it goes up and down the way it is, they call it a market correction. What they’re doing affects us less than you think - it’s the consumer mindset that takes the hit, not their portfolio. So, what you're seeing is a market correction on a market correction's market correction. ?!%&&%$. Yes, that's what I said...

The traders on the floor do the same thing everyday, but, because the spotlight has been shined on the U.S. credit rating, the people in the bubble are moving things around differently. In actuality, most of that trading is in individual stocks - most people’s 401K’s contain mutual funds as well as individual stocks from their company. Back to the mutual funds...

Mutual funds were designed to be diversified. If 1 or 2 stocks in the fund take a hit, you have the others to balance them until they rebound. That’s the point. And, they were designed to hold over time, not to sell everyday. What you see those people doing is day-trading, which, is the complete opposite of what the average consumer is doing. So, with or without Standard & Poor’s, they’re doing the same thing today as they were doing 2 weeks ago. Like I said in my post about the debate over the economy - IGNORE THEM! By the time we get past Labor Day, your 401K or mutual fund will be back on the rebound. Mine already is. Just like 2 years ago when they took a hit, mine has already recovered all of it’s losses - i’m sure yours has too. IGNORE THEM!

Remember, the investment community are the ones who caused this mess that we’re all still trying to clean up. Don’t let them make a fool out of you again...

Get back out there and buy, buy, buy - even if it’s just a toothbrush - buy something. And be consistent, even if it’s small things. Our economy doesn’t run if consumers aren’t buying anything. That’s a fact. Be more worried about that than the BS you hear from investment firms. Carpe Diem!!!!!!!!

I have made a point not to write about the debt ceiling or the national debt or the shenanigans of our national elected officials until today, August 2, 2011. Why? Because I knew they would string this out until the last minute and because I wanted to be able to say everything I needed to say in one shot. Here it go...

THEY settled at raising the debt ceiling, proposing budget cuts in the trillions and creating a bipartisan council to facilitate the budget cuts. Why did that take months? It’s pretty standard fiscal practice that if you’re having budget problems, YOU HAVE TO MAKE CUTS! No new news there.

But, I do have to give a special mention to President Obama for pointing out that his daughters - 10 and 13 - don’t wait until the last minute to do their homework. Congress shouldn’t wait until the last minute to do their homework either. As a reminder, it is Tuesday, August 2, 2011 and the final agreement was announced today. I thought the people we elected to Congress were the annoying kids who sad in the front of the class, not the losers who sat in the back of the class. Losers, back of the class for this go ‘round.

Even sadder are the reports about the tea party freshmen who just wouldn’t agree to anything. OK, Washington is all quid pro quo, but, to be obstinate just because you want to be different is short-sighted. This battle is so much worse because of the last election. There’s now a large class of newcomers who are eager/desperate/intent on proving themselves. Unfortunately, they’re trailblazing at our expense. They’re still bright and shiny and untainted by, “The way of The Hill.” No, that doesn’t mean they need to perpetuate the WDC BS, but, turning this whole process into a circus reminds me of the phrase, “The grass is not always greener on the other side.”

Raising the debt ceiling is a product of a growing economy. Like the Dow Jones index grows as a product of our growing economy. No one is complaining that the Dow keeps getting bigger. Let it get bigger. In fact, when Republicans argue that tax incentives for big business will put those businesses in a position to create jobs and incentives for consumers, I’m all for it. Problem is, we confirm these tax incentives for big business, but, they don’t return the savings to the marketplace citing profits not at expectation. They self-create the fear in the marketplace and consumer confidence hits the skids. Vicious cycle. There should be conditions attached to the tax incentives. It’s classic return-on-investment. Big business makes deals based on ROI, why shouldn’t the government? WDC is all about quid pro quo, ya know...

Another special note: The analysts at the Wall Street ratings agencies and investment firms should stay out of this debate. Why are they being given a platform at all? These are the same people who contributed to this economic mess - they should just keep their heads down and focus on helping their clients recover their losses, create bigger gains and restore consumer confidence. It’s funny they think they have the credibility to suggest they are considering downgrading the US credit rating from AAA to AA. They’re a joke. Pay no attention to them - keep buying, no selling. Just needed to say that. Back to the issue at hand...

Our political structure is a democracy. What a novel idea to create a smaller version of the Congress to oversee and implement the plan!? Who knew... I feel like I just finished watching a movie. The performances were not Oscar-worthy, but, I feel that the actors were really trying to get there. I think it’s more like, EMMY-worthy...

Maybe that’s why As The World Turns, All My Children and One Life to Live got cancelled - the networks need to make room for Barack My World and The Boehner of our Existence. I mean really, who can resist all that crying...

You know, in the middle 80’s, there was a soap opera called Capital that was set in WDC. It got cancelled and replaced by The Bold and The Beautiful, but, I remember thinking it was a good idea for a soap opera. In retrospect, there was/is no need for a dramatic series about our government and Washington politics. The everyday business of government and politics in WDC IS a daytime drama and when they can’t agree on anything, it also becomes a primetime drama. Who needs soap operas anymore.

Actually, if you think about how this has unfolded and think about the elements of the dramatic series, it fits. In the last year, viewers have been subjected to occasional cut-ins about the negotiations and fairly regular press conferences used for the purpose of pointing the finger at the opposition. And elected officials are always under the threat of violence by unstable individuals. Offices have been vandalized, there’s been a sex scandal or two and people have been shot. While getting shot in real-life is heinous, getting shot in TV land is a badge of honor... it means you’re the star. No disrespect intended, but, for dramas, someone’s gotta get shot -- it’s a part of the formula. Like Dallas, Falcon Crest and Dynasty. Think about what WHO SHOT J.R.? did for Dallas...

So, I propose two new Emmy categories: Best Daytime Press Conference and Best Primetime Press Conference. The nominees are: Barack Obama, John Boehner, Nancy Pelosi, Eric Cantor and Jay Carney. And the Daytime Emmy goes to - John Boehner for obvious reasons... And the Primetime Emmy goes to - Barak Obama for sheer frequency. LOL.

OK, no more jokes, I want to address a couple of things substantively:

The debt ceiling: It’s a fact that every president since the debt ceiling was established in 1917 has manipulated it. It has been both raised and lowered. Word is that Reagan raised it 17 times. This is the everyday work of the Executive and Legislative branches of our government. To make a spectacle of this discussion/process is nothing more than propaganda. We don’t need to see you making the sausages...

I don’t chronicle every iteration of my journal reports -- no one wants to see that. I also don’t want to watch my accountant do my taxes in real-time. Just give me the finished product. As elected officials, I get that they need to be accountable. I want that too. But, spend the time working in good faith, get to a resolution that is about US not you, and make an announcement. Did we really need to know that John Boehner wouldn’t take Barack Obama’s phone call? I did not need to know that. Anymore than I need to know the names of Erica Kane’s many husbands.

It’s their everyday work. As someone who has covered The Hill, it really is one of the more boring beats around WDC. There’s just a lot of waiting. Waiting for a hearing to start - waiting for a hearing to end... waiting for a member to show up... listening to endless testimony. Other beats have been much more interesting to cover and to write about. It‘s also a fact that the staffers in the office buildings work like dogs. The members? ...hhmmmm. They show up when they need to put on a performance. President Obama called it right when he said, “I’ve been here working, where are you?” Political affiliations aside - much of what the president is revealing about the Congress is true. I hope the people of this country can see that, even if they haven’t covered WDC. I also hope that when the people of this country realize the congress is the problem, they stop blaming President Obama for everything. He is at least making good sense and making some progress relieving problems caused by a predecessor who made no sense and made no progress.

Which brings me to the REAL issue: The 2012 election. This whole debate, for the past several months has been an exercise in positioning. The Republicans wanted to revisit this situation in 7 months to, 1) Create friction for Obama in the middle of the campaign season and 2) Divide Obama’s efforts so that he won’t be as effective at either. That’s filthy.

I’ve seen some polls that suggest the country thinks the Republicans are being unreasonable. Though we are a nation that re-elected George W. Bush, it appears we have learned from that mistake. Blind opposition seems to be the only way many Republicans are able to function. Valid consideration of issues and substantive decision-making -- regardless of who said it -- sit second chair to the right side of the aisle. I’m still waiting for a Republican to answer the question, “Do you think people with private jets should get special tax breaks?”

Now we’re in the middle of an economic crisis; no jobs, people are losing their homes, and the Republicans are more concerned about an election? Not that the Democrats aren’t concerned about the election, but, no sane person would want to go through this again so soon. It makes better sense to get through the election and let whomever ends up being president deal with moving the ball forward. The Democrats win this one whether they meant to or not.

The last thing I want to say is the same thing The House Chaplin said as he opened a recent session: HELP US LORD. :-)

Regards,

BA

I mean that in the most socially casual way...

Because the exact details of the contract are not for public consumption, I’m not sure who - if anyone - got pimped. But, if you look at this strictly in dollars and cents, no one got pimped, they all still end up millionaires.

I think in the end, that’s what we the fans take away. This seems to have been a battle between the haves and the have-mores. I just want to break this down by pros and cons...

Pros: I for one am glad to see an organization negotiating in good faith to be on equal ground. I’m also glad to hear that this isn’t just about the $$$, but, about better long-term benefits for players and better health management for players. I think there were some additional changes to the rules as well to make the game safer. All good. But, I hope the National Football League Players Association (NFLPA) has also taken some steps to educate players about how to deal with MONEY.

Con: The players have successfully negotiated for their fair share of the pie, but, what are they going to do with it? They’ve shown great business acumen. But, how many of them will end up living close to the poverty line at some point after they leave the league despite the new provisions? Wouldn’t it have been better to invest some of the money for the future instead of buying 3 homes and 7 cars? What good is having had a Lamborghini if you now can’t walk? Some of these players are basically young kids making hundreds of thousands of dollars, if not millions. Who’s showing them how not to blow it all in one sitting?

We’ve seen the stories about the players who retire, then later find out they have football-related injuries, can’t afford the health care costs and end up on government assistance. I find that unacceptable. No person who makes millions of dollars a year, or even hundreds of thousands of dollars a year for an extended period of time should find themselves with a food stamp debit card. We all want to live well, but, many players take their good fortune to extremes. Being irresponsible with money shows bad judgement. I can only hope this process has shed some light on the responsibility attached to fighting for equality in compensation.

Con: The way this story is being reported in the news. The reporters who are telling this story forget they’re not talking to lawyers or union members or even people who work in a sports-related jobs. The average person has no idea what re-certification means. I didn’t know what they meant, so of course, I looked it up.

It just means when the contract between the players and the owners expired earlier this year, it also dissolved the players union. So, for the players to have a union again, they had to formally, legally, certify that they want to be a union and sign on the dotted line. You can be an association without being a union. Being a union gave them additional, legal rights they would not be able to exercise as an association.

I think it was just a matter of jargon. Some of it may be the usual - reporters trying to impress other news types instead of remembering, they’re doing these stories for the news consumer, not the competition. I mentioned this in a previous entry, but, they need to remember where they came from. Newsroom 101 - Keep it simple stupid.

Now for the more social take on this deal... WE GET OUR FOOTBALL SEASON!
For those of us who love NFL, we don’t care about the off season bickering - we just want our Sundays and Mondays in front of the TV, pulling for our teams. Go Browns!

Special note: For those of you who will be tempted to leave disparaging comments about the Browns on this entry, save your keystrokes for someone who will be damaged by them. I don’t care if the Browns win or lose - I’m a Browns fan for life. It was no joke when we fought to keep the Browns; Still no joke now. Football fans everywhere know this about Browns fans. Save your keystrokes...

But do comment on the NFL in general. I’m not stupid; I do have a backup team so that I can extend my season into the playoffs. Go Jets!

We’ll see you Sunday’s this Fall...

I finally got to watch the mini-series, The Kennedys. I don’t know what was so controversial about it – maybe I just know too much about the Kennedy’s. I didn’t learn too much new – it was a surprise to me that Jackie smoked... even when she was pregnant. And got happy juice shots. I knew JFK was all hopped up on pills and had a body that failed him all day, everyday. Is that what the Kennedys didn't want people to know? Didn't change anything for me...

But there was another thing that did surprise me… In this version, the creators suggested that JFK’s philandering was a matter of weakness, not dominance. There was one scene when he admitted to Bobby that it wasn’t even about the sex; He did it just because he was alone and couldn’t sleep. I’m not sure about that. Rich and powerful men generally cheat because they can, not because they need to. I think he did it because he could. The creators of this version also made JFK out to be a bit sheepish overall. Don’t buy that either. You don’t get to be one of the most revered Presidents' of the United States by being sheepish.

Of note: The casting was outstanding – spot on. From Joe Sr. to Rose to Barry Pepper as Bobby. Spot on. Katie Holmes as Jackie showed the only flaw and that was in her dialect in some spots. She sounded like she was from Brooklyn sometimes. But, it wasn’t bad enough to make a difference. And the look of the series was as neat as all the scotch they drank.

One noticeable omission was Teddy. There was absolutely no mention of Teddy at all. No mention of Joan either and Joan and Jackie were quite close. It’s a well known fact that Jackie and Eunice weren’t the best of friends, but, Joan and Jackie were. Teddy also worked on JFK’s presidential election campaign, so, he should have been a part of this story as well. Glaring omission...

It was nice to hear more details about how and where Joe Jr. fit in the picture. The stories usually start at JFK and focus mostly on him, Bobby and Teddy. This version started with Joe and showed his place and interactions with his siblings and Joe Sr. Now had they added Teddy to the story, it would likely have been the most authentic, revealing version to date. The ending could have been better, but, all things considered, this version gets an A from me.

I’ve been into the history of the Kennedys since I was a kid, so, for me, this was just another way to confirm the recurring facts and sift out the ones that don’t jive. But, in all that I know, I think this version is one of the best I’ve seen and would give the casual Kennedy-phile a great true-to-life reveal.

I highly recommend this mini-series. All that BS over getting it on air was stupid. And to the Kennedy family – let the truth be what it is. No family is perfect, not even an American dynasty. At least yours has had a significant impact on the history of the United States…

It’s been almost 2 months since Scott Pelley took the anchor chair and he’s away on his first assignment for 60 Minutes. 2 Days into his absence and I’m back on board. Bob Schieffer is awesome.

Day 2 with Bob Schieffer... A paraphrase of his opening line: Rupert Murdoch was in front of the British Parliament today to testify - took a flurry of questions... then he got hit in the face with a cream pie... LMAO.

If CBS wasn’t sure they made a mistake before yesterday, they should be sure now. Even CBS’s Business Correspondent Anthony Mason had to LOL during his introduction from the ease at which Schieffer delivered that line. It was refreshing... it was honest. Fact is, Bob don’t give a damn - He’s not trying to prove anything to anyone. He’s the first anchor CBS has had in that chair since Walter Cronkite who convinces us that he’s genuine. Scott Pelley is killing me...

This is reminding me of NBC’s big gaffe when they gave The Tonight Show to Conan O’Brien and put Jay Leno at 10. Stupid. I understand they were attempting to move the brand forward, but, they would have been better of leaving Jay on The Tonight Show and trying Conan at 10. No disruption of the brand. Now NBC Entertainment just looks like idiots.

This is where we are with CBS. I see it coming - by the end of the summer, there’s going to be another change. I said in my very first blog post that they should have just given the chair to Harry Smith. With good reason, Harry has now left to go to NBC. What were they expecting? You would think they would have learned from the mistakes they made passing over John Roberts years ago. Looks like news executives haven’t gotten any more in-tune with society...

But, my guess is that Bob Schieffer is not interested in a full time job like the evening news 5 days a week. My bet is that he’s perfectly happy living here in WDC, taping Face The Nation every Sunday and thinking on retirement. I want it on record that I want his job. Face The Nation with Billy Abshaw has a nice ring to it... Stay tuned...

But, in just 2 days, Bob Schieffer has given some life back to the broadcast. Even more-so than Katie Couric. Not hard to do following Dan Rather, but... The word is that during his 17 months anchoring the broadcast before Katie took the chair, ratings were up significantly enough to get CBS in 2nd place. Katie Couric only got to 2nd place once or twice, but, nothing prolonged. What does that tell you CBS?

So, here is my suggestion for how CBS should handle this... I’ll use another NBC situation - this one from the early 90’s. The Today Show. Jane Pauley leaves Today. Her replacement is Deborah Norville. Audiences are not warming up to Deborah Norville. She goes out on maternity leave, in comes pregnant Katie Couric as her fill-in. Perfect plan; Katie goes out on maternity leave, Deborah comes back, all is well. However, audiences LOVE Katie Couric. 16 years later, Katie Couric leaves as the highest paid morning show anchor ever with the highest ratings ever.

When you’re learning the art of writing for television news, there is always someone in the newsroom who is happy to tell you this: Keep it simple stupid (KISS).

Note to CBS: Leave all the bad staffing decisions to NBC. KISS...