Beer & Whiskey Pretty Risky, Whiskey & Beer Have No Fear

We are back; Spring Break and a family funeral have kept us away since March 14.

Risk, a word that means different things, in different situations, to different people: Risk may be working for a supervisor who has no clue what is going on and is evil to boot; Risk may be not taking care of oneself health wise; Risk may be watching John Travolta’s new face in the O.J. Simpson Trial on FX; as the Blog title suggests Risk may be drinking the wrong combination of beverage;  finally Risk may be trying to manage one’s finances in these economic times.

The three biggest risks to the economy over the past year have often been reported as the commodity plunge, China and central banks losing their effectiveness. Two of the three were recently cited by Morgan Stanley. In Morgan Stanley’s opinion, lower oil prices are not having as much of a positive impact as they have had over the past year. Additionally, the financial services firm worries about how much of an impact easy monetary policy will have going forward.

Based on these conditions, Morgan Stanley believes that the global economy is vulnerable to shocks, including ineffective moves by the Federal Reserve, European Central Bank and Bank of Japan. It also cited the refugee crisis in Europe and Turkey, the potential for Brexit, geopolitical concerns in the Middle East, and an impeachment scandal in Brazil.

Other risks not specifically mentioned by Morgan Stanley should also be considered. They include record global debt levels, China at overcapacity and overleveraged and massive derivatives exposure for Deutsche Bank AG (DB) and JPMorgan Chase & Co. (JPM). Risks also include the unknown impact of negative interest rates implemented by five central banks around the world and aging populations in the world’s largest economies, which is fueling deflation.

The investment brokerage expects global growth of 3% in 2016. This will be led by a slowdown in developed markets, especially in the United States, where it sees growth of 1.7% in 2016 and 1.6% in 2017. The International Monetary Fund also recently warned of a global recession, stating that risks have increased. This is despite the recent rally in equities. Last month, Citigroup Inc. (C) warned of the potential for global recession.

These are far from the only bearish opinions out there. While the next opinion doesn’t have quite the amount of exposure of Morgan Stanley, the IMF and Citigroup, his opinion is widely respected on Wall Street.

Chain Reaction - Dennis Gartman, the editor and publisher of The Gartman Letter, expects a chain reaction that doesn’t end up in a positive place. In his opinion higher oil prices indicate a strong economy, which will lead to interest rate hikes. When this happens, it will lead to reduced demand for equities and corporations will allocate more capital to growth than stock buybacks. He expects this to lead to a wider divergence between the real economy and the stock market, and that a growing economy will lead to further Fed tightening. This will weaken the economy and lead to lower stock prices.

That theory might be correct, but you can’t discount the theory that oil isn’t helping the economy and that instead it’s an effect of a weak economy. If this theory is correct the divergence between the real economy and the stock market is the opposite, which means the real economy is weak and the stock market is strong. This would explain why the Federal Reserve is so conflicted. It’s dual mandate is 2% inflation and full employment, but it won’t raise rates unless the stock market is behaving. As many of you know, if you remove Federal Reserve policy, the stock market would be nowhere near where it is today. A recent study showed that 93% of S&P 500 performance since the financial crisis was caused by the Federal Reserve. And if you’re paying attention to basic technical analysis, the 200-day moving average for the S&P 500 shows resistance at 2,025 and support at 1,820. That’s not a good risk/reward. Regardless of which theory is correct, neither lead to a bullish scenario.

The Bottom Line - The global economy is in poor condition. There is simply slowing growth around the world. Without central bank intervention, we would absolutely be dealing with a global recession (or worse) right now. The problem is that the more central banks offer support, the more debt is accumulated. That debt will eventually come due, which leads to a deleveraging process. You can’t allocate capital to massive deleveraging and growth at the same time, which only makes the deflationary scenario worse in the future. Either we deal with the pain now and limit the damage, or face a much bigger problem down the road.

IPO NO GO - First quarter ends with almost no IPO activity: In the first quarter, eight companies raised $700 million in initial public offerings, according to Renaissance Capital's quarterly review of the U.S. stock market. Those numbers are dismal in comparison to the previous quarter, when 32 companies raised $6.8 billion. It's a low the market hasn't seen since the 2008 financial crisis, according to the report.

CALIFORNIA DREAMING -- California Assembly passes historic minimum wage hike: A first-in-the-nation plan to gradually boost California's minimum wage to $15 an hour over the next six years won the Legislature's approval today after rancorous floor debates on whether the move would strengthen or harm families and the economy. Minimum wage hike will cost taxpayers $3.6B a year: The University of California, Berkeley, Center for Labor Research and Education projected the ripple effect of a $15 minimum wage on higher earners could raise pay for 5.6 million Californians by an average of 24 percent.

TESLA – the company that has never made a profit introduced this past week Tesla Model 3: Reserve now, drive later. North American reservations for Tesla Model 3 - the $35,000 electric sedan for the broad market – began Friday at Tesla stores. The Model 3 is expected to carry a $35,000 sticker price, not including federal and state incentives. CEO Elon Musk unveils the prototype in Los Angeles. Online reservations open April 1.

POLITICS 101 - June primary: California buckles up: Brace yourselves, Californians. The violent, vicious and volatile Republican political campaigns that have destroyed civility across parts of the South and Midwest are increasingly likely to cross the Sierra and spread vitriol in the Golden State.

TRUMP BRANDING: "incompetent Hillary" -- Trump appears to be adding a new line to his collection of signature insults, a list that includes 'low-energy Jeb Bush,' 'lyin' Ted Cruz' and 'Little Marco Rubio.' I think people will see I'm much more competent than she is,' Trump says,  'Incompetent Hillary doesn't know what she's talking about' ... [On his Twitter feed:] 'Incompetent Hillary, despite the horrible attack in Brussels today, wants borders to be weak and open-and let the Muslims flow in. No way!

Days until the Wisconsin primary: 1.

Days until the 2016 election: 218.

QUOTE OF THE WEEKEND - Maureen Dowd, "Trump Does It His Way": "You could hear how hard it was for Donald Trump to say the words. 'Yeah, it was a mistake,' he said ... 'If I had to do it again, I wouldn't have sent it.' I was telling him he lost my sister's vote when he retweeted a seriously unflattering photo of the pretty Heidi Cruz next to a glam shot of his wife, Melania. ...

"Given his draconian comment, sending women back to back alleys, I had to ask: When he was a swinging bachelor in Manhattan, was he ever involved with anyone who had an abortion? 'Such an interesting question,' he said. 'So what's your next question?' ... I pressed, how he could possibly win with 73 percent of women in this country turned off by him? He chose another poll, murmuring, 'It was 68 percent, actually."

STUFF TRUMP SAYS -- How Donald Trump sees himself: He considers himself a member of 'the lucky sperm club.' He trusts no one, and places a premium on revenge. ('If you do not get even, you are just a schmuck!') He treats every decision he makes 'like a lover,' sometimes thinking with his head, other times with other parts of his body, because it reminds him to 'keep in touch with my basic impulses.' And to make creative choices, he writes: 'I try to step back and remember my first shallow reaction. The day I realized it can be smart to be shallow was, for me, a deep experience.

JUST THE FACTS MA’AM - California crime on the rise: In California's 68 largest cities, violent crime jumped 11 percent in the first six months of 2015 compared to the same period in 2014. Among major U.S. cities, three California cities saw the largest increase in property crime in the country.

BIRTHDAYS THIS WEEK – Birthday wishes and thoughts this week to: C-SPAN (37); Doris Day (93) Carmel, CA; Gordie Howe (88) Dallas, TX; Jerry Lewis (90) Bel Aire, CA; Lara Logan (45) New York, NY;  Mike Love (75) Del Mar, CA; Reba McEntire (61) Houston, TX; Gene Shalit (90) Huntington, NY.

COLLEGE CHRONICLES – FILLING IN FEDERAL GRAD RATE GAPS: More than half of bachelor's degree holders attended more than one college - meaning they're not counted as completers in the federal graduation rate. But a new National Student Clearinghouse report [http://bit.ly/25nn8u6 ] for the first time breaks down by sector the progress and outcomes of all students in the fall 2009 cohort, not just first-time full-time ones. The presentation of the data is modeled after the Student Achievement Measure, a 600-institution initiative promoting better and more complete outcomes information; it shows what percentage of students dropped out, transferred and graduated, transferred and are still enrolled and so on.

- "Until now, there has been no way for institutions to measure themselves against their peers beyond the incomplete and misleading federal graduation rate," said Christine Keller, vice president of research and policy analysis at the Association of Public and Land-grant Universities. "As Congress looks to reauthorize the Higher Education Act, it should lift the ban on a national student-level data collection system so that the transparency of SAM is extended universally across higher education."

APPLE AT FORTY - At 40 years old, Apple is shooting for immortality: Apple, as it turns 40 on April 1, deserves more than its share of cake. It's earned all 40 candles. In corporate America, 40 has got to be the new 80. Companies don't live as long as they used to. Getting big does not guarantee there will be a future. In fact, as we have seen with many firms, the opposite is true. Success is more short-lived than ever. So how has Apple led the tech pack for so long?

FINAL FOUR LOOK AHEAD - North Carolina looks for 6th NCAA title against Villanova: North Carolina will look for its sixth NCAA championship when the Tar Heels meet the Villanova Wildcats, trying for their second, on Monday night. The Tar Heels (33-6) last won it all in 2009 and Villanova's only title came in 1985. Both teams advanced to the championship game with lopsided wins, but Villanova's was far more of a blowout than North Carolina's.

COLLEGE HOCKEY GAME OF THE WEEK – The Frozen Four: Thursday 4/7: #6 Boston College Eagles (28-7-5) vs #1 Quinnipiac Bobcats (31-3-7). Bobcats win 5 – 3. #7 Denver Pioneers (25-9-6) vs #3 North Dakota Fighting Hawks (32-6-4), North Dakota wins 6 – 2.

Final – Saturday 4/9: Quinnipiac 4 North Dakota 3.  Season to date (9-7).

THE SWAMI’S WEEK TOP PICKS –

Major League Baseball Preseason Picks:

American League: East – Toronto Blue Jays, Central – Kansas City Royals, West – Texas Rangers, Wild Card – Houston Astros, Detroit Tigers. Champs – Texas Rangers

National League: East – New York Mets, Central –Chicago Cubs, West – San Francisco Giants, Wild Card – Pittsburgh Pirates, Arizona Diamondbacks. Champs – New York Mets

World Series Champs – New York Mets

No Chance in Hell – Oakland Athletics, Colorado Rockies, Cincinnati Reds, Milwaukee, Brewers, Philadelphia Phillies, Atlanta Braves, San Diego Padres.

Season to date (30 -17)

SPORTS $$$ -- MLB average salary $4.4M after 4.4 pct rise: The Los Angeles Dodgers topped spending for the third straight season. The Chicago Cubs boosted payroll by $51 million, adding Jason Heyward, John Lackey and Ben Zobrist in an effort to win their first title since 1908. After beating the Cubs in the NL Championship Series and losing to Kansas City in the World Series, the New York Mets hiked spending by nearly $38 million. ... The New York Yankees, No. 1 for 15 straight years before the Dodgers' payroll surge, are second at $225 million followed by Detroit ($196 million), Boston ($190 million) and San Francisco ($173 million). The average for the 864 players on opening-day rosters, the disabled list and the restricted list was $4,381,980.

MARKET WEEK - The Dow closed out the first three months of the year in the green, after the worst start ever to a year. The Dow's quarterly comeback was its biggest reversal since 1933.U.S. oil prices were on the decline this morning, hitting their lowest levels in more than two weeks, on renewed worries of global oversupply. But crude was on track to post a strong quarterly gain.

With all the stock and oil volatility this year, gold has been the beneficiary, with prices heading for their best quarter in close to 30 years. The precious metal was modestly higher this morning.

The dollar index, against a basket of major currencies, which has jumped sharply over the past two years, was poised for a sizable first-quarter decline. The dollar was also under pressure this morning.

The U.S. stock market has taken off, but it has left behind an important passenger: the IPO (see above IPO NO GO). Major stock indexes have gained about 13 percent in the past seven weeks and are now in positive territory after a swoon early in the year. The market for initial public offerings, however, is in its slowest period since the first quarter of 2009 ... Analysts and traders warn that the second quarter may not bring much relief.

The sharp divergence is puzzling investors, who figure the two should move in the same direction. They said if the pace of IPOs doesn't accelerate, it could be a warning sign for the rally, a signal that investors haven't fully regained their appetite for risk. ... Meanwhile, the market environment could portend more pain for investors in private technology companies who have bought in at valuations that likely can't be reached in the public markets in the near term.

DRIVING THE WEEK - President Obama this morning meets with NATO Secretary-General Stoltenberg ... Minnesota Fed President Neel Kashkari holds a highly anticipated symposium on ending TBTF (more on which below) ... Senate Banking has hearing at 10:00 a.m. Tuesday on consumer finance regulation ... Voters hit the polls in Wisconsin on Tuesday with Donald Trump set up for a possibly big loss to Ted Cruz ... Ex-Im Bank has a meeting at 7:30 a.m. on Thursday ... Senate Banking has a CFPB hearing on Thursday at 10:00 a.m. ... ISM non-manufacturing at 10:00 a.m. Tuesday expected to rise to 54.1 from 53.4.

Next week: Jack Ass and the Words of the Month.

Until Next Monday, Adios.

Claremont, CA

April 4, 2016

#VI-36-298

CARTOON OF THE WEEK –Rob Rogers, Pittsburgh Post-Gazette

Bullying

I am sure everyone at one time or another has been bullied. It has been and will always be a problem in any society or culture. But this year bullying is playing a central theme in our Presidential campaign.

Lauren Underwood writes below about her experience at a Trump rally before the Michigan primary last week.

Lauren Underwood, Garden City, Michigan - Okay, so I'm going to go ahead and share my experience at Donald Trump's rally in Warren, MI today. We'll start with why I went. I am a firm believer in being educated on ALL candidates, not just the one you're rooting for, so Stephanie and I decided to attend. If you know me, it's no surprise that I am not a fan of Trump due to his racist, misogynist, and popularity-searching "campaign". But I try to keep an open mind, understanding that people have different views and everyone is entitled to their own. I wore a shirt bashing Trump, and Stephanie wore a pro-Bernie Sanders baseball hat. We had no intentions of causing a scene, starting any fights, or even speaking negatively towards any Trump-supporters. We stood in the crowd with everyone else, even made small talk with a few different people, asking back and forth about each other's views. A women supporting Trump even complimented our hat and shirt.

This is not a post to bash all Trump-supporters. Most of the people we spoke to were very kind to us, as we were to them. Trump came out and started his speech. As hard as it was, we ignored the screams and chants of building walls and exporting citizens. We stood quietly and listened to the man speak. Every 15 or so minutes, a scene would happen where the crowd would yell about protestors and Trump would scream, "Get them out, send them out of here!" and the crowd would scream "USA, USA, USA" until the attendees who were asked to leave were escorted out. So, about 45 minutes to an hour into his speech, a group of teenage boys (who had been harassing us the entire time while we ignored their comments) screamed and pointed at us, yelling for us to be kicked out. At first we laughed it off, of course we couldn't be kicked out, we were just standing here silently. Wrong. A secret service member and a police officer were there within the minute, grabbed Stephanie and I by our arms, and started to lead us out. One of the Trump supporters we were chatting with even stood up for us, explaining that we weren't doing anything and weren't being disruptive. By now the crowd was chanting their USA run and a large portion was also booing us out. The walk through the crowd was very upsetting, being screamed at and filmed, even one man said "Go to China if you like communism so much!"

(Communism?? Don't you mean democratic socialism??). But also, along the walk out, some attendees would high five us or shake our hands, and thank us for coming and supporting Bernie. It felt weird to be thanked, due to us not doing anything besides standing quietly. As the two men walked us out, one explained that if we returned we would be arrested. Stephanie quickly asked why that was. The man replied with "They don't want you here," to which she said "Isn't it a constitutional right to silently protest?" The officer replied "Not here." The rude remarks and yells didn't stop at the door, for Trump-supporters who didn't get in greeted us with just as much hatred. The walk back to my truck even included a man yelling from his car about how this was for Trump people and that we didn't belong here and shouldn't have come. This kind of hatred is what is ruining this country. To think that my right to protest was taken from me AT A RALLY, scares the hell out of me for if Trump actually became president and got that power. What else would he take away from us if he can't even stand two teenage girls standing silently at a FREE, PUBLIC, OPEN-TO-EVERYONE event? If you're thinking of voting Trump this year, please rethink your stance.

This much hate belongs nowhere near the presidency.

THE TRUMP INFOMERCIAL - Say what you will about the GOP front-runner, his press conferences are remarkable performance art. Tuesday night's was perhaps the most amazing yet. In an upbeat victory speech that was part press conference, part product-placement bonanza - and equal parts political circus - the Republican presidential front-runner managed to plug Trump Steaks, Trump Magazine and Trump Water.

Donald Trump touted his golf courses, his wineries and his business school. Watching the spectacle was his newest supporter, former New York Yankees outfielder Paul O'Neill - who got an extended on-air shout out from the billionaire. 'I don't think I've seen such a stream of disconnected ideas since I quit psychiatry 30 years ago,' said conservative columnist Charles Krauthammer on Fox News.

TRUMP's TALL TALES – “Trump's Week of Errors, Exaggerations and Flat-out Falsehoods: POLITICO Magazine subjected the GOP frontrunner to our fact-checking process: The result: more than five dozen statements deemed mischaracterizations, exaggerations, or simply false ... It equates to roughly one misstatement every five minutes."

BIRTHDAYS THIS WEEK – Birthday wishes and thoughts this week to: Alex Ball …famous campaign advisor to Josh Gottheimer for Congress NJ 5^th;  Michael Caine (82) London, England; Jon Hamm (45) Woodland Hills, CA; Carrie Underwood (33) Memphis, TN; Bruce Willis (60) Bel Air, CA; Bow Wow (29) Brooklyn, NY.

COLLEGE CHRONICLES – College endowments are seeing losses. A dozen funds that responded to requests from Bloomberg for their returns for the first six months of fiscal 2016 showed an average loss of 3.8 percent. Indiana University’s $2.3 billion endowment had the biggest loss at 6.1 percent through Dec. 31. Pennsylvania State University’s $3.7 billion fund had the smallest decline at 1.8 percent. The Standard & Poor’s 500 Index lost 1.6 percent in that time.

The interim results from schools, nearly all with assets of at least $1 billion, provide a snapshot of performance at endowments, which are typically heavily invested in equities, hedge funds and private equity. While global equities have rallied recently, endowments may be unable to make up for lost ground when the fiscal year ends June 30. Investment returns contribute to a school’s annual operating budget.

The six-month losses come after lackluster 2.4 percent returns on average for fiscal 2015, the worst since a 0.3 percent decline three years prior, according to the National Association of College and University Business Officers and investment manager Commonfund. While endowments invest for the long term, the schools set a formula -- often an average of the previous three or five years of returns -- for annual spending rates to fund academic operations.

Schools typically spend about 4 percent to 5 percent, which means they need annual returns to be higher to avoid cutting into principal. The chief investment officers of some of the wealthiest endowments, including those at Harvard and the University of Notre Dame, said last week at an investing conference that the current environment will be challenging for returns.

For decades, endowments typically followed a portfolio model in which the majority of assets were invested in equities. Asset allocations, which still include stocks, have expanded to include hedge funds, private equity, emerging markets and commodities, making the funds more susceptible to swings in the price of oil or the pace of China’s economic recovery.

2015: WEAKEST EARNINGS YEAR SINCE THE CRISIS – 2015 results reported saw S&P earnings per share fall by 12.7 percent, according to S&P Dow Jones Indices. That is the sharpest decline since the financial crisis year of 2008. Plus, the reported earnings were 25 percent lower than the pro forma figures - the widest difference since 2008 when companies took a record amount of charges.

THE RETIREMENT CRISIS: STILL HAPPENING - News flash: Americans still aren't saving enough money for retirement. ... . While slightly less than two-thirds of white families have managed to put something away for their post-work lives, only 41 percent of black families and barely one-quarter of Latino families can say the same.

VALUABLE JUNK - The riskiest part of the U.S. corporate-bond market is staging a comeback, marking an upswing in investor confidence following a turbulent start to the year. Returns on junk bonds turned positive for 2016 this month, reversing a sharp selloff at the beginning of the year. The surge is one of the most convincing signs that the recession fears that rattled markets earlier this year have faded. While analysts continue to scrutinize stock valuations amid soft global-growth expectations and slumping U.S. corporate earnings, many portfolio managers say stocks and junk bonds look relatively attractive at a time when yields on safe assets such as government bonds are in many cases near record lows and falling. U.S. stocks tiptoed to their longest rally since October last week as a rise in oil prices lifted energy shares.

OUT AND ABOUT – Last Saturday’s Detroit Red Wings win over the New York Rangers at The Joe, saw this distinguished group of Detroit Country Day alumni celebrating Terry Tangkas’ birthday.

From left to right: Randy Field ’72, Mike Page ’71, Terry Zangkas ’72. Dan Kanaan ‘72.

2017 WINTER CLASSIC – The Detroit Red Wings are heading back outdoors to play the Toronto Maple Leafs. The NHL made it official last week with the announcement the two teams will play Sunday, Jan. 1, 2017, in the first NHL Centennial Classic at Toronto’s BMO Field where Major League Soccer's Toronto FC and Canadian Football League's Argonauts play. The game will be a rematch of the 2014 Winter Classic that set a record crowd of 105,491 at Michigan Stadium in Ann Arbor. The Maple Leafs won the game, 3-2, in a shootout.

The 2017 game will be part of a yearlong Centennial celebration that will feature a variety of special events highlighting the 100th year of the NHL.

MARCH MADNESS! - UVA, UNC, Kansas and Oregon are the #1 seeds. Full bracket: http://es.pn/1V5PxA6

BRACKETOLOGY 101 – We like a Final Four of Kansas, Oklahoma, Providence, and Michigan State in this year’s March Madness NCAA Basketball Tournament.

COLLEGE HOCKEY GAME OF THE WEEK – Friday 3/18, 7:30 CT, HGTV; #6 University of Denver Pioneers (23-8-5) vs. #5 St. Cloud State Huskies (29-8-1), the NCHC tournament semi-final, Huskies in a wild one 6 – 5.  Season to date (8-7).

THE SWAMI’S WEEK TOP PICKS –

(SCIAC, Mar. 15) Baseball; Ithaca College Bombers (2-3) at Claremont-Mudd Republicans (4-12), the annual spring break visit of Coach George Valesente’s South Hill club, Ithaca wins 8 – 4.

(ECAC, Mar. 18) #18 St. Lawrence University Saints (19-13-4) vs. #12 Harvard University Crimson (18-9-4), ECAC semifinal, Saints win in OT 4 – 3.

 (NHL, Mar. 19) Boston Bruins (39-23-8) at Los Angeles Kings (40-22-5), two teams heading towards Lord Stanley’s tournament, LA wins 3 – 2.

(NBA, Mar. 19) Golden State Warriors (59-6) at San Antonio Spurs (56-10), forget about the NCAA tourney tonight, this is HUGE: Warriors win in OT 106 – 104.

Season to date (26 -17)

MARKET WEEK - There were no government economic reports due out today, but Wall Street get a flood of key inflation numbers tomorrow and Wednesday ahead of the Fed's interest rate decision. The producer price index is out tomorrow and the consumer price index is out Wednesday.

DRIVING THE WEEK - Fed announcement and Yellen presser on Wednesday with no rate hike expected. Markets will look for any dot-plot changes and hints about when the next hike might come ... Tuesday's primaries will either put Trump on a glide path to the nomination or make a contested convention a serious possibility ... Senate Banking has a nominations hearing Tuesday at 10:00 a.m. ... FDIC meets Tuesday at 10:00 a.m. ... U.S. Chamber hosts its capital markets summit Wednesday at 8:00 a.m. ... ABA holds its government relations summit Wednesday at 8:30 a.m. ... House Financial Services holds a CFPB hearing Wednesday at 10:00 a.m. ... Retail sales Tuesday at 8:30 a.m. expected to drop 0.1 percent headline and 0.2 percent ex-autos ...

Tuesday's primaries could decide whether Donald Trump can lock up the GOP nomination before the July convention or if chaos in Cleveland lies ahead. Should Trump take both Florida (99 delegates) and Ohio (66), there is probably no stopping him. But while the marketing executive leads by significant margins in most Florida polls, he trails home state governor John Kasich in Ohio. GOP 2012 nominee Mitt Romney will campaign in Ohio with Kasich on Monday as the "stop Trump" effort enters what could be its final days ...

If Trump splits the two big states, establishment dreams of keeping him from the 1,237 delegates he needs will remain viable. If he somehow loses both, Trump could be in real trouble. The other big prizes up for grabs Tuesday include Missouri, Illinois and North Carolina. Trump could take them all but Kasich has a shot in Illinois and Ted Cruz has his best chance in Missouri.

Next week: Jack Ass and the Words of the Month.

Until Next Monday, Happy St. Patrick’s Day.

Claremont, CA

March 14, 2016

#VI-35-297

CARTOON OF THE WEEK –Nick Anderson, Hearst Papers

International Women's Day

My wife is the living proof that you can move up without putting someone down, be strong without making someone weak and love without having to hate.

International Women’s Day is a time to reflect on progress made, to call for change and to celebrate acts of courage and determination by ordinary women who have played an extraordinary role in the history of their countries and communities.

The International Women’s Day theme for 2016 is "Planet 50-50 by 2030: Step It Up for Gender Equality.”

THE PRESS -  "DERELICTS OF DOODY: Senate GOP leaders sign letter vowing to defy Constitution and ignore ANY Supreme pick." See the cover. http://nydn.us/vp5qdB

QUOTE OF THE WEEK: "I will never vote for Donald Trump, not even if Ronald Reagan and William F. Buckley rise from the grave and beg me to support him." - Rick Wilson, a GOP consultant who outlined the many, many reason he won't support Trump in an op-ed. http://bit.ly/1QYrKMV

FOR THE LOVE OF LIBRARIES: President Barack Obama's nominee for the 14th Librarian of Congress has an "unparalleled" dedication to learning and education, the president said. He and Carla Hayden (and first lady Michelle Obama) go way back; they all know each other from Hayden's days working at the Chicago Public Library in the early 1990s. Hayden - who would be the first woman and the first African American to hold the position - is now CEO at Baltimore's Enoch Pratt Free Library. "It became that community meeting place, and people were so relieved to have a safe place to be," she said. "I believe in what libraries can be for a civilized society, and a country that is open to all." The former American Library Association president, who would take over amid criticism of the technology policies at the nation's oldest federal cultural institution, must still be confirmed by the Senate.

THE CARDINAL WAY -- One day after announcing a record-setting $400 million donation from Nike founder Phil Knight, comes this from Stanford's Kathleen Sullivan: "The Stanford University Board of Trustees has approved a 3.5 percent increase in undergraduate tuition for the 2016-17 school year...total undergraduate charges will increase to $62,541 next year, including $47,331 for tuition, $14,601 for room and board, and $609 for a mandatory health fee." http://stanford.io/1KOK1zG

JUST DO IT: Nike's founder Phil Knight donates $400 million to Stanford University, via Wall Street Journal: One of the largest philanthropic gifts ever to a learning institution... http://on.wsj.com/1T77xdY

BIRTHDAYS THIS WEEK – Birthday wishes and thoughts this week to: Ron Howard (62) Studio City, CA; Tea Leoni (50) San Marino, CA; Eddie Murray (60) New York, NY; Joanne Woodward (86) Wilton, CT.

COLLEGE CHRONICLES – Engineering Failure:  The most valuable problems may be the unsolvable ones. The engineering school at Northwestern University is using the power of problems without clear solutions to prepare freshmen for the ups and downs of college and careers. Aware that some of its academically successful students arrive on campus without ever having failed at anything, the university requires all new engineering majors to take an unusual course featuring challenges they often can’t meet: working in teams to design and build devices to help individuals with disabilities. Learning to handle failure in small doses equips students for bigger challenges, professors say, building resilience and humility.

"USC tuition to top $50,000 for the first time,'' via LATimes: http://lat.ms/1L79N2g

SUMMERS ON TRUMP - Larry Summers blogs: "While comparisons between Donald Trump and Mussolini or Hitler are overwrought, Trump's rise does illustrate how democratic processes can lose its way and turn dangerously toxic when there is intense economic frustration and widespread apprehension about the future. This is especially the case when some previously respected leaders scurry to make peace in a new order - yes Chris Christie, I mean you. ...

"The possible election of Donald Trump as President is the greatest present threat to the prosperity and security of the United States. I have had a strong point of view on each of the last ten presidential elections, but never before had I feared that what I regarded as the wrong outcome would in the long sweep of history risk grave damage to the American project."

MIKE BARNICLE in Daily Beast, "The Two Americas Behind Donald Trump and Bernie Sanders": "The sadness within the American promise is that in places where voices are not heard, where dreams are now nearly dead, where a generation of hard work and solid wages have been hollowed out or stolen as the establishment sat on its hands unwilling to fight an economic system geared to satisfying shareholders before addressing the real needs of families that once thought they were on a level playing field, the future is now filled with dread instead of a dream.”

WALL STREET'S NEXT BIG SHORT: TRUMP? - Add the juggernaut that is Donald J. Trump to the list of what-ifs that is worrying Wall Street. A growing realization that the unpredictable New York real estate developer is in a position to win the Republican nomination and then battle Hillary Clinton for the White House in November's election has caused some investors to sell U.S. stocks. They fear having such a wild-card president could trigger trade wars, hurt the economy and add a lot of market volatility.

“As the market rarely feasts on lack of predictability - Trump represents a nightmare for investors this year,' said hedge fund manager Douglas Kass of Seabreeze Partners Management Inc, who said last week that he was adding to his existing short bet on the U.S. stock market in part because of Trump's increasingly strong position in the race. Trump's statements on business and Wall Street don't neatly fit into one ideological worldview, but if anything, they are seen as isolationist in a globally connected world".

Last Week Tonight with John Oliver on Donald Trump: https://youtu.be/DnpO_RTSNmQ

COPY THAT - Xerox Corp. will split itself in two and give several board seats to activist investor Carl Icahn, reversing an effort by the century-old company to marry business services with its copiers and printers. Xerox will divide into two publicly traded companies: one containing its office machines and another housing its services operations ... The company made the announcement last week when it is forecast to report a fourth straight year of declining profits and sales.

The split unravels Xerox's biggest ever acquisition, the 2010 purchase of Affiliated Computer Services Inc. for about $6 billion, which pushed Xerox deeper into providing bill processing, managing call centers and other back-office services to government agencies and corporations. The split would follow a similar move by rival Hewlett-Packard Co. last fall. ... Mr. Icahn in November disclosed a stake in Xerox and said he would seek talks with the company about its future. With an 8.1 percent stake in the company, Mr. Icahn's hedge fund is now the second-largest shareholder after Vanguard.

COLLEGE HOCKEY GAME OF THE WEEK – Saturday 3/12, 7:00 p.m. ET: ECAC Quarterfinals, Clarkson College Golden Knights (20-13-3) at #18 St. Lawrence University Saints (17-13-4). Two old, old rivals battle for a ticket to Lake Placid. Saints in a tight one 4-3.  Season to date (7-7).

THE SWAMI’S WEEK TOP PICKS –

(SCIAC, Mar. 12) Baseball; University of Redlands Bulldogs (10-5) vs. California Lutheran Kingsmen (7-4), two top four teams in conference, Cal Lu 7 – 4.

(NHL, Mar. 12) New York Rangers (39-22-6) at Detroit Red Wings (32-23-11), The Wings suddenly are fighting for their playoff lives, they win 3 – 2.

(NBA, Mar. 12) Oklahoma City Thunder (43-20) at San Antonio Spurs (54-10), Spurs breeze, 104 – 85.

Season to date (23 -16)

REMEMBERING Nancy Davis Reagan ... LOU CANNON, who was written five books about Ronald Reagan and covered his presidency as senior White House correspondent for The Washington Post, is the eye-popping byline on the N.Y. Times obit of Nancy Reagan, "Fierce Protector and Influential Force as First Lady: Champion in the Struggles Against Drug Abuse and Alzheimer's Disease" (one-third of front page, plus 1.5 pages inside): "'Without Nancy, there would have been no Governor Reagan, no President Reagan,' said Michael K. Deaver, a longtime aide and close friend of the Reagans who died in 2007.

Next week: Bullying and the Words of the Month.

Until Next Monday, Adios.

Claremont, CA

March 8, 2016

#VI-34-296

CARTOON OF THE WEEK – “Hooray for Women”

Gravity

I am not a scientist, not even close, but I enjoy science; the wonder and mystery of it all. A recent scientific story has grabbed my attention: Gravity.

More than 300 years ago, Isaac Newton said that any two objects that have mass are attracted to each other and held together by a force.

And that force is what Newton called gravity. He could calculate it, but he couldn’t explain where gravity came from. That is how things have stayed for more than 200 years: Until Albert Einstein showed up.

Einstein thought about gravity in a fundamentally different way. Here’s where things get fun. I want you to close your eyes. Imagine a large rubber sheet, like a trampoline. Now drop a large metal ball onto it. The ball causes the sheet to bend beneath it, forming a dimple. The bigger the ball, the bigger the dimple.

OK, scale it up. Now the ball is the Sun, and it’s sitting not on a rubber sheet, but rather in a four-dimensional fabric — what Einstein called space-time.

Masses like the Earth or the Sun bend the space-time around them, and by bending the space-time around them, they effectively attract nearby objects. That is how Einstein understood gravity — gravity is what happens when objects bend space-time.

Einstein saw it as one of the four fundamental forces of our universe — including electromagnetism and the two forces at work inside atoms.  But even though gravity is the force that is most obvious in our lives, it turns out that gravity is the weakest. So to see its effect, you need something dramatic — something that creates massive ripples in space-time, like waves moving out from a rock dropped in a pond. In fact, Einstein called these gravitational waves.

If you were to turn up the amplitude of a gravitational wave beyond anything which we think is reasonable to expect, eventually you would feel it as something which would stretch you from head to toe while squishing you from side to side, and then reverse in polarity and squish you from head to toe and stretch you from side to side. But while Einstein predicted gravitational waves, he never observed them. The tools just didn't exist. Until today.

A couple of weeks ago, a team of some 1,000 researchers from the US and around the world announced the first ever direct detection of gravitational waves.

"It's just exhilarating," says Gabriela Gonzalez, a physicist at Louisiana State University and a spokesperson for the project called LIGO (the Laser Interferometer Gravitational-Wave Observatory). "Here, we detected the space-time around us wobbling, getting distorted, compressed and stretched for a fraction of a second. There’s so much to learn now!"

And how these gravitational waves were detected is nothing short of incredible. The LIGO team built two giant L-shaped detectors in Louisiana and Washington state. The arm of each L is two-and-a-half miles long.

The arms of this L are these concrete bunkers and under the concrete bunker, we have a tube so that we can suck all the air out — it’s a vacuum tube. The team have tested equipment for the LIGO project in their lab at MIT. The lab is about the size of a basketball court, and a giant metal tube with a laser in it travels its length. A lot of what’s here and inside the real bunkers is meant to keep the apparatus absolutely still. You can't have any shaking because the lasers measure the precise lengths of those two-and-a-half mile arms.

So if there were no gravitational waves, they would have the same length," astrophysicist Priya Natarajan says. "But if it turns out, because of gravitational waves causing a jiggle, one of the arms is going to have a slightly different length than the other." And that difference in length is really small. "We are talking about a fraction of the diameter of a proton," Natarajan says. "It’s that tiny." They’re trying to detect less than a proton difference across 2.5 miles — that’s why it’s so challenging.

And yet despite the crazy, they did it. The LIGO team used those L-shaped buildings to detect gravitational waves that were produced by a collision of two black holes more than a billion light years away. It's the first time we’ve observed this violent phenomenon in the universe — ever. It’s as if we had an enormous hearing aide, which let us pick up the sounds that the universe has been producing — we just have been deaf to these sounds up until now. In fact, you can actually convert a gravitational wave into a sound wave.

The collision sent gravitational waves rippling outwards at the speed of light. More than a billion years later, they passed through the Earth and made the arms of the detectors in Louisiana and Washington change their lengths ever so slightly.

OK, this is all cool to think about — bending space-time, shooting lasers down vacuum tunnels, colliding black holes — but beyond proving Einstein right, what’s the big deal?

Natarajan says, "It’s like opening a new window into the universe." You see, up until now, we’ve studied the stars and outer space using light or something related to it — radio waves, X-rays, microwaves. "But gravitational waves are the first step away from that to some completely new way of looking at the universe," Evans says. "It’s not a way of looking at things through light any more. It’s a way of listening to things through the disturbances they make in space-time."

"It reveals an entire new side to the cosmos," Natarajan adds. For instance, we might now be able to directly observe black holes. Because while black holes don't emit light, they do emit gravitational waves. "If you look at the universe just using gravitational waves, you’re likely to see all these jiggling black holes," Natarajan says.  And here’s the other reason this is a big deal. "Because gravity waves are not obscured by anything, we can see right through to the edge of the universe," Natarajan says. And that means we might be able to get closer than ever to observing the earliest moments of time, just after the big bang — and closer than ever to understanding how the universe came to be, and how it works.

"I actually never imagined that in my lifetime that window would open," Natarajan says. With that window now open, Natarajan says it may boost interest in another international collaboration — a joint NASA/European Space Agency project to look for different kinds of gravitational waves. All kinds of exciting possibilities lie ahead. But let’s return to today. Because it’s not every day that we get to hear (literally) the universe confirm something we first conjured up on paper a hundred years ago. "It is really hard not to be completely in awe of Einstein," Natarajan says. "Just to think that this theory came completely out of his pure thought."

KASHKARI DROPS A BOMB - Minneapolis Fed President (and ex-Goldman Sachs banker and George W. Bush Wall Street bailout mechanic) Neel Kashkari dropped a bomb on the banking industry on Tuesday with a speech in DC calling for breaking up "too big to fail" banks. In remarks at Brookings, Kashkari said the "biggest banks are still too big to fail and continue to pose a significant, ongoing risk to our economy" and promised a plan to end the problem by the end of the year."

Among possible actions, Kashkari listed : "Breaking up large banks into smaller, less connected, less important entities. Turning large banks into public utilities by forcing them to hold so much capital that they virtually can't fail (with regulation akin to that of a nuclear power plant): Taxing leverage throughout the financial system to reduce systemic risks wherever they lie.”

"Options such as these have been mentioned before, but in my view, policymakers and legislators have not yet seriously considered the need to implement them in the near term. They are transformational - which can be unsettling. The financial sector has lobbied hard to preserve its current structure and thrown up endless objections to fundamental change.”

WALMART SALES DROP - Walmart reported its first annual sales decline since at least 1980, underlining the stiff challenges it faces competing against Amazon in ecommerce while coping with the impact of the strong dollar and a loss of share at its UK Asda stores. The 0.7 per cent decline in revenue to $482.1bn* for the year ended January was due mainly to the strong dollar, without the impact of which sales would have risen 2.8 per cent. ... The fall, the worst in at least 35 years according to S&P Capital IQ data, came as the world's largest retailer said that ecommerce sales growth slowed for the fifth consecutive quarter to 8 per cent in the final three months of the year. The company blamed the deceleration on its UK, Chinese and Brazilian markets. By contrast Amazon's quarterly growth was 26 per cent despite its much larger base.

The company reduced its sales growth outlook for this fiscal year to flat from between 3-4 per cent, reflecting a worse than expected impact from currency fluctuations and loss of revenue from its store closures. Shares slid 3.1 per cent to $64.09 by close of trading in New York. The 54-year-old company, which grew into the world's largest retailer from a single store in rural Arkansas, is undertaking its biggest transformation since its inception as it tackles intensifying competition amid rapid shifts in the way consumers shop."

MOCKINGBIRD REVIEW - "When 'Mockingbird' Was New": The cover of N.Y. Times Arts section shows the full clipping of Herbert Mitgang's July 13, 1960, review of "To Kill a Mockingbird," by Harper Lee, who died last week in Monroeville, Ala., at 89: "The meaning in this novel runs even deeper because of the subject of injustice in the South. Miss Lee's original characters are people to cherish in this winning first novel by a fresh writer with something significant to say, South and North." See the image, read the review. http://nyti.ms/1mO7Sno

GOOD READS --"In Conversation: Antonin Scalia," by Jennifer Senior in the Oct 6, 2013 issue of New York Magazine: "On the eve of a new Supreme Court session, the firebrand justice discusses gay rights and media echo chambers, Seinfeld and the Devil, and how much he cares about his intellectual legacy ('I don't')." http://nym.ag/1WwCQwC

--"Last Days," by William Finnegan in The New Yorker: "Preparing for the apocalypse in San Bernardino." http://bit.ly/1Ok9oEb

A SIGN OF THE TIMES - A group of guys, all age 40, discussed where they should meet for lunch. Finally it was agreed that they would meet at Hooters, because the waitresses had big breasts and wore short shorts.

Ten years later, at age 50, the friends once again discussed where they should meet for lunch. Finally it was agreed that they would meet at Hooters, because the waitresses were attractive. The food and service were good and the beer selection was excellent.

Ten years later, at age 60, the friends again discussed where they should meet for lunch. Finally it was agreed that they would meet at Hooters, because there was plenty of parking, they could dine in peace and quiet with no loud music, and it was good value for the money.

Ten years later, at age 70, the friends discussed where they should meet for lunch. Finally it was agreed that they would meet at Hooters, because the restaurant was wheelchair accessible and had a toilet for the disabled.

Ten years later, at age 80, the friends discussed where they should meet for lunch. Finally it was agreed that they would meet at Hooters, because they had never been there before.

Thank you to Dr. Seth Kogan (Detroit Country Day ’72) for the above piece.

MUST-READ -- "No direction home" -- From Capital & Main, a week long, in-depth look at the affordable housing crisis in California: "The scope of the problem is huge. California leads the nation in the number of severely rent-burdened households, and has the largest shortage of affordable rental homes. The Golden State has 21 of the nation's 30 most expensive rental markets -- yet at the same time, nearly a quarter of California residents live in poverty."

WOMEN AT WORK - Older women are reshaping the U.S. job market. They are working or seeking work longer than any previous generation as they look ahead to more years of life than men their age, with less accumulated wealth. Since the start of the recession in December 2007, the share of older working women has grown while the percentage of every other category of U.S. worker has declined or is flat. Overall, older Americans are better off financially than the previous generation, but would-be retirees had less time to rebuild their savings after the economic downturn. Yet the tie between financial insecurity and later retirement is difficult to prove: many working later in life are skilled workers earning higher incomes—though they do cite need for money as their reason for working.

BIRTHDAYS THIS WEEK – Birthday wishes and thoughts this week to: Jim Brown (80) Pasadena, CA; Cindy Crawford (50) Malibu, CA; Smokey Robinson (76) San Marino, CA; Cybill Shepherd (66) Studio City, CA; Maria Suffredini …famous photographer; John Travolta (62), his face is (6) Beverly Hills, CA.

HOT VIDEO - Watch the Cast of Hamilton Perform the Electrifying Opening Number-and Win a Grammy" - 4-min. video http://slate.me/1TnplkK

OUT AND ABOUT – Last Friday night’s St. Lawrence vs. Yale hockey game, in New Haven, CT. (we lost 4-3), brought out some very famous Beta Theta Pi’s to the event:

From left to right: Teb Barnard (Carol Street, Franklin, Michigan), Kevin McGrath, John Greenwood, Hugh Lappe (famous hockey and baseball player and lover of The Doors).

COLLEGE HOCKEY GAME OF THE WEEK – Saturday 2/27 7:00 PM ET, HGTV: The last weekend of the regular ECAC season #12 Harvard University Crimson (15-8-4) vs. #19 St. Lawrence University Saints (16-12-4). Appleton Arena in Canton, New York will be rocking in this battle for third and fourth place in the ECAC. Saints win 5 – 3.  Season to date (6-7).

THE SWAMI’S WEEK TOP PICKS –

(SCIAC, Feb. 27) Baseball; University of La Verne Leopards (5-2) vs. Claremont-Mudd Republicans, Republicans prevail 7 – 4.

(NHL, Feb. 27) St. Louis Blues (35-18-9) vs. Nashville Predators (29-21-11), Nashville is fighting for a playoff, they win 2 – 1.

(NBA, Feb. 27) Miami Heat (32-24) vs. Boston Celtics (33-25), Celtics 90 – 86.

Season to date (20 -15)

DRIVING THE WEEK - Nevada GOP caucuses on Tuesday. Canada here I come, Trump Wins ... Treasury Secretary Jack Lew travels to Shanghai, China for the G-20 Finance Ministers and Central Bank Governors Meeting on February 26-27 ... House Ways and Means has a hearing at 10:00 a.m. Wednesday on the Global Tax Environment in 2016 and Implications for International Tax Reform ... House Financial Services subcommittee has a hearing at 10:00 a.m. Wednesday on "The Impact of the Dodd-Frank Act and Basel III on the Fixed Income Market and Securitizations" ... SEC has a meeting at 9:30 a.m. Thursday on small and emerging companies ... House Agriculture subcommittee has a hearing at 10:00 a.m. Thursday on review the G-20 swap data reporting goals ... House Natural Resources Committee has a hearing Thursday at 10:00 a.m. on "The U.S. Department of the Treasury's Analysis of the Situation in Puerto Rico" ... Case-Shiller home prices at 9:00 a.m. Tuesday expected to rise 0.9 percent ... Consumer confidence at 10:00 a.m. Tuesday expected to dip to 97.3 from 98.1 ...

Next week: Wall Street vs. Me Street

Until Next Monday, Adios.

Claremont, CA

February 23, 2016

#VI-33-295

CARTOON OF THE WEEK – “Pandora’s iPhone”