Cartoon Tuesday

Vic Harville, Little Rock, Arkansas

Hurricane Katrina--Wind or water, does it really matter?

A federal judge in Mississippi today began hearing testimony in the case of a couple whose home was damaged by Hurricane Katrina but their insurance company has paid only $1,600 for $130,000 in damage.

Now, before anyone gets worked into a lather about the big, bad insurance company stickin' it to the poor policyholder, consider this fact: Flood damage is excluded from virtually every homeowners policy. That's right, unless you buy separate flood insurance, usually through the National Flood Insurance Program, your home is not covered for flood damage.

This court case is interesting because its outcome could affect thousands of other homeowners whose homes suffered wind and water damage from Katrina. A ruling that wind caused the damage changes everything.

The trial, being heard without a jury by U.S. District Judge L. T. Senter Jr., is the first among hundreds of lawsuits that have been filed by Gulf Coast homeowners challenging insurance companies over the wind-verses-water issue. Plaintiffs' attorneys hope a ruling in the homeowners' favor would pressure insurance companies to pay out hundreds of millions of dollars in settlements for homeowners whose claims have been rejected.

The homeowners also charge that their agent told them in 1999 that they didn't need flood insurance. I hope they're not really expecting the judge to believe that. Who ever heard of an insurance agent telling clients that they don't need more coverage?

The week in review

• DJIA dropped 59.55 this past week, .53% to finish at 11,090.67. A lousy jobs report on Friday spoiled an otherwise decent week.
  

• Nasdaq Composite fell 42.o3 points, 1.94% this past week to finish at 2130.06.
  

• S & P 500 dropped 4.72 points, .37% and finished up at 1265.48.
  

• 10-year Treasury yield fell again this week and ended the week down 0.007 percentage points to 5.138%.
  

• Crude oil increased in price by another .22%, just $0.16 to $74.09/bbl. Oh yeah, Jim Rogers told Reuters that oil will soar to well over $100, although he didn't give a timetable.
  

Happy Independence Day!

Cartoon Tuesday

Bob Englehart, The Hartford Courant

Capitalist of the week: Warren Buffett

With his announcement last week that he would donate $31 billion (give or take) to the Bill and Melinda Gates Foundation, Warren Buffett wins the coveted honor of Capitalist of the Week.

Born August 30th, 1930 and known as the Oracle of Omaha, Buffet is ranked as the second wealthiest person in the world behind Bill Gates. He is known for his unpretentiousness and frugality. Despite his immense wealth he still lives in the same Omaha house that he purchased in 1958 for $31,500 and draws a scant $100,000 salary from Berkshire Hathaway.

Atta boy, Warren!

The week in review

• DJIA gained 161.13 this past week, 1.47% to finish at 11,15022, thanks to some encouraging Fed comments on Thursday.
  

• Nasdaq Composite picked up a healthy 50.62 points, 2.39% this past week to finish at 2172.09.
  

• S & P 500 gained 25.70, 2.07% and finished the week at 11270.20.
  

• 10-year Treasury yield fell 0.083 percentage points to end the week at 5.145%.
  

• Crude oil had a big week, increasing in price by 4.32%, that's $3.06 and is now around $73.93/bbl.
  

My favorite news story of the week comes from just down the hill at Berkeley Ctiy Council's Wednesday evening meeting:

With overwhelming support from Berkeley residents, the Berkeley City Council unanimously passed a resolution Tuesday night to be the first jurisdiction in the United States to let the public vote for the president's impeachment. The measure will appear on the Nov. 7 ballot, at a cost of about $10,000.

I've been a bad, bad blogger

Geez, it's been over two weeks since my last post! And only two or three posts per week for the last several months. How did that happen?

Well, let's see. Three months ago I started a new job that's been pretty demanding and the change alone is somewhat stressful. So, longer hours and a more demanding job have been a factor. Add to that some travel. It's just hard to blog when you're away from home, even with a laptop and the wireless access that most hotels offer.

And then there was the 20th anniversary trip to Hawaii with Mrs. THC. Blog from Hawaii? C'mon, get serious.

Most recently, I spent eight days away at a Financial Planning Association program in the Midwest. I had my laptop with me but there just wasn't time to do any blogging.

Now I'm back home and things are settling down a bit. No promises, but I hope to be a bit more attentive to The Happy Capitalist. I've missed it.

Cartoon Tuesday

Cameron (Cam) Cardow, The Ottawa Citizen

The week in review

• DJIA lost 355.95 this past week, 3.16% to finish at 10,891.92. Very ugly.
  

• Nasdaq Composite shed 84.35 points or 3.80% this past week to finish at 2135.06.
  

• S&P 500 lost 35.92, 2.79% and finished the week at 1252.30.
  

• 10-year Treasury yield fell 0.021 percentage points to finish at 4.979%. Below 5%, this is interesting.
  

• Crude oil dropped $0.70 or 0.97% to finish the week at $71.63.

ca·pit·u·la·tion (k-pch-lshn) n.

1. The act of surrendering or giving up. See Synonyms at surrender.
2. A document containing the terms of surrender.
3. An enumeration of the main parts of a subject; a summary.

The question on my mind, now that this market downturn has become a significant correction, is whether capitulation is necessary to end it. Do we really need to see the Dow blow off 500 points in a day before it can turn around?

Cartoon Tuesday

Marshall Ramsey, Jackson, Mississippi, The Clarion Ledger

The week in review

• DJIA lost 30.74 for the week, 0.27% to finish at 11,247.87. That's still positive by 530 points for the year.
  

• Nasdaq Composite gained 9.04 or 0.41 this past week to finish at 2219.41.
  

• S&P 500 gained 8.06, 0.63% and finished the week at 1288.22.
  

• 10-year Treasury yield fell 0.052 to finish at 5.00%. Could it drop below 5%?
  

• Crude oil rose by $0.96 or 1.35% to finish the week at $72.33. I paid $4.29/gallon for gas on Maui last week, so the Bay Area's $3.35 doesn't seem nearly so bad.
  

Treasury Secretary John Snow resigned May 30th and President Bush nominated Henry Paulson, Jr. of Goldman Sachs to head the Treasury. If confirmed, Paulson will be the first Treasury Secretary from Wall Street to lead the department during the Bush administration. Snow, who had been Treasury Secretary since February, 2003, came from the railroad industry. Bush's first Treasury Secretary was Paul O'Neill who had been with International Paper and Alcoa.

Cartoon Tuesday

Chan Lowe, The South Florida Sun Sentine

Maui Sunset

We've taken a few days to get away. This is a photo we took from our hotel balcony on our first evening in Maui.

Capitalist of the week: Dan Brown

Dan Brown, author of The Da Vinci Code is Capitalist of the Week.

Born June 22, 1964 in Exeter, New Hampshire, Brown attended Amherst college. After graduation he dabbled in music and teaching before becoming a full-time writer in 1996. He had mediocre success with his first three novels, selling fewer than 10,000 copies in each of their first printings, but The Da Vinci Code, his fourth, went to the top of the New York Times Best Seller List during its first week in 2003 and has now sold well over 60 million copies.

In 2005 Forbes magazine estimated Brown's annual income to be about $76.5 million and his income from The Da Vinci Code to be $250 million. Brown sold the film rights for another $6 million.

Nicely done, Dan.

Bob Englehart, The Hartford Courant

Lower taxes? It'll never work!

Critics of the Bush Administration's 2001 and 2003 tax cuts said they wouldn't work. They wouldn't help pull the U.S. economy out of recession, they wouldn't generate more tax revenue, they were no more than a payoff to Bush's wealthy supporters.
Perhaps they were mistaken.

Treasury Secretary John Snow, in a speech to the Bond Market Association Friday, said: "The results are in, and they are clear: Economic growth has led to a surge of tax revenues and shrinking deficits. Despite the cries from our critics, it cannot be denied that low taxes truly are consistent with rising federal revenues, which of course help bring the deficit down."

Hmmm. When you remove confiscatory taxes that are disincentives to investment and wealth creation, lo and behold, Americans invest in themselves and in U.S. business. They create more jobs, more higher paying jobs, higher corporate profits, a stronger economy and, in the long run, higher tax revenues.

It's not rocket science. It's capitalism.

The week in review

• DJIA lost 236.93 for the week, 2.08% to finish at 11,144.06. Ouch!. But just for some perspective, we finished 2005 at 10,717.50, so we're still up 4% year-to-date.
  

• Nasdaq Composite shed 49.90, not as bad as last week. It finished at 2193.88, down 2.22%. The Nasdaq finished 2005 at 2205, so it's showing a 0.5% loss for the year.
  

• S&P 500 dropped 24.21, 1.87% and finished the week at 1267.03. It closed 2005 at 1248, so it's still 1.5% on the positive side.
  

• 10-year Treasury yield fell 0.130 to finish at 5.062%.
  

• Crude oil dropped a whopping $3.51 to finish the week below $70 at $68.53. So that means gasoline should be dropping 20-30 cents/gallon, right?

Stocks fell really hard on Wednesday, 214 points, the biggest single day drop since March of 2003.

Burger King priced its initial public offering on Wednesday at $17. It wasn't the best time to begin public trading but BKC fared pretty well.

The jury began deliberations this week in the Enron trial, no verdict yet. Heck, the trials only been going on 56 days.

Investment quiz

Here's a quick and easy investment question for you: Wednesday, on average, is the best day of the week for stocks with the S&P 500 up 0.08% and the Nasdaq up 0.12%. So what's the worst day of the week?

Cartoon Tuesday

Bob Englehart, The Hartford Courant

Capitalists of the week: Herbert and Marion Sandler

In 1963 Herbert and Marion Sandler bought a California thrift for $3.8 million called Golden West Financial. They nurtured it for 43 years and this week the Oakland-based company agreed to sell itself to Wachovia Bank in a $25 billion cash and stock deal.

Herbert and Marion Sandler are this week's Capitalists of the Week, hands down.

Marion, 75, and Herbert, 74, share the title of co-chief executive at Golden West. Both said they believe they made the right decision to relinquish their ownership and control of Golden West.

"We feel good about Wachovia," Marion Sandler said. "They are a good company. It is an amazing cultural fit. They are employee-oriented. Their benefits package is even better than ours. They understand customer service. They are very philanthropic and community-oriented."

Congratulations, Herbert and Marion!

Only in Kalifornia

There was a time when a high school diploma indicated some level of proficiency in the three 'r's. Not anymore, at least not in California.

On Friday, Alameda County Superior Court Judge Robert Freedman ruled that the state cannot carry out its plan to withhold diplomas from high school seniors who have not passed the state's exit exam which tests English, math and algebra skills.

State schools Superintendent Jack O'Connell said he was "greatly disappointed" and will appeal the ruling next week.

"Not only is the ruling a great personal disappointment for me, it's bad news for California students who've worked hard to pass the exit exam, bad news for employers who want meaning restored to our high school diplomas and bad news for our public schools that have risen to the challenge," said O'Connell, who wrote the 1999 law that set the graduation test in motion and is its biggest champion.

Once upon a time a high school diploma actually meant something. Now it doesn't even mean that you can read and write.

The week in review

• DJIA got crushed Thursday and Friday to finish the week down 196.75, 1.70% at 11380.99
  

• Nasdaq Composite really got hammered to the tune of 98.79 or 4.22% and closed the week at 2243.78.
  

• S&P 500 lost 34.52, 2.60% to close at 1291.24
  

• 10-year Treasury yield rose .082 percentage points and stands at 5.192%.
  

• Crude oil rose $1.85 or 2.64% at $72.04

The tumble on Thursday and Friday ended a five-week run for the Dow and dashed hopes for a new record that, early in week, seemed well within reach. It's all about interest rates and inflation folks with just a bit of consumer confidence uncertainty thrown in for good measure.

Cartoon Tuesday

J.D. Crowe, Mobile Register

Capitalist of the week: Steve Wynn

Stephen Wynn, casino resort developer, is credited with spearheading the incredible expansion of Las Vegas during the 1990s.

Born in 1942 to the owner of a string of bingo parlors on the east coast, Wynn did well enough running his father's bingo operation to buy a stake in the Frontier Hotel in Las Vegas in 1967. From there he became involved in expanding the Golden Nugget and then the Mirage. Wynn began to set the standard in Las Vegas for size and lavishness. The Wynn Las Vegas opened in 2005 and is set to open a new casino in China later this year.

According to Forbes, Wynn became a billionaire in 2004 when his net worth doubled to $1.3 billion. Stephen Wynn is truly deserving of the title "Capitalist of the Week".

(Sorry that The Happy Capitalist blog has been so neglected these last few days, but I felt the need to research this piece personally. Thanks to Mrs. THC for the photo of the Wynn Resort).

Immigration and taxes

With all the hubbub lately about "undocumented workers" we've been wondering if these folks have been paying their fair share of taxes. After all, how do the IRS and Social Security Administration keep track of them if there are no Social Security numbers? If the illegal workers are using fake numbers, where does the money go? The New York Times shed some light on it today.

It is impossible to know exactly how many illegal immigrant workers pay taxes. But according to specialists, most of them do. Since 1986, when the Immigration Reform and Control Act set penalties for employers who knowingly hire illegal immigrants, most such workers have been forced to buy fake ID's to get a job.

Currently available for about $150 on street corners in just about any immigrant neighborhood in California, a typical fake ID package includes a green card and a Social Security card. It provides cover for employers, who, if asked, can plausibly assert that they believe all their workers are legal. It also means that workers must be paid by the book - with payroll tax deductions.

Since the Social Security numbers are fictitious, the contributions end up in Social Security limbo.

Starting in the late 1980's, the Social Security Administration received a flood of W-2 earnings reports with incorrect - sometimes simply fictitious - Social Security numbers. It stashed them in what it calls the "earnings suspense file" in the hope that someday it would figure out whom they belonged to.

In the current decade, the file is growing, on average, by more than $50 billion a year, generating $6 billion to $7 billion in Social Security tax revenue and about $1.5 billion in Medicare taxes.

Without legal status these workers will never be able to collect any Social Security or Medicare benefits but they continue to subsidize the struggling system. For that I say, "Gracias!"

Cartoon Tuesday

Politicalcartoons.comMike Lester, Rome News-Tribune, Rome, GA

Capitalist of the week: Tony Snow

We're actually not sure where Tony Snow stands on free markets or various socioeconomic systems but, c'mon, anyone who starts with a degree in philosophy and later becomes the Press Secretary for the most powerful office in the world, must be a strong believer in free enterprise. Right?

Last week Snow was named White House Press Secretary to replace Scott McClellan in the Bush administration. He will begin his duties on May 8th.

The week in review

• DJIA gained 19.69 or .17% to close the week at 11367.14. Baby steps.
  

• Nasdaq Composite gave up 20.29 or .87% and closed at 2322.57
  

• S&P 500 lost .67 , .05% to close at 1310.61
  

• 10-year Treasury yield rose .057 percentage points and stands at 5.067%.
  

• Oil dropped $3.29 or 4.38% and finished Friday at 71.88/barrel. Well, it's a breather. Will it show up at the pump?
  

Rough duty

Very light blogging this weekend as business has called us to wine country. Honest, it's business. I'll be back soon...maybe.

Death and taxes...and taxes and taxes

You're taxed when you earn it, taxed when you spend it, taxed when you invest it and then, if there's some left when you die, it gets taxed again. The estate tax is regarded as the most unfair of all taxes by many and it's slated to be phased out in 2010. But unless Congress acts, it comes right back to life in 2011. (Anyone who can explain what Congress was thinking when they wrote this legislation gets a gold star!)

Now this:

A new survey shows that 57% of Americans wanted to keep the estate tax - often dubbed the "death tax" - as is rather than reform it.

Just 23% said they favored repealing the tax.

The telephone survey of 910 registered voters was conducted by Washington-based research firm Penn Schoen & Berland Associates Inc. in February and released this month, just as the issue is expected to move to the forefront politically. The Senate is slated to debate next month whether reform is needed on the estate tax.

A lot of folks have the impression that the estate tax only impacts wealthy taxpayers, but unless there is meaningful reform, millions of pretty ordinary Americans will be in for a very expensive surprise.

Cartoon Tuesday

Cartoon by Tab

Capitalists of the week

For convincing a jury to award $32 million in the heart attack death of a Vioxx patient, the family of Leonel Garza and their attorneys win the distinction of "Capitalists of the week".

Merck, the maker of Vioxx, pulled the arthritis medication from the market in 2004 when a study linked the drug to fatal heart attacks in patients who took it for more than 18 months. Mr. Garza took Vioxx for 17 days. Garza was 71 years old when he died in 2001, had a history of smoking, suffered a prior heart attack in 1981 and had quadruple bypass surgery in 1985.

The decision was handed down by a jury in Rio Grande City in a region of Texas notorious for favoring plaintiffs.

"Many courts in other counties would toss this case because of the standard that no reasonable juror could find for the plaintiff in this situation," said Victor Schwartz, counsel to the American Tort Reform Association. "It's been our experience that many of the courts in the Rio Grande Valley are very, very friendly to plaintiffs' counsel and let cases go forward."

The ATRA named the overwhelmingly Mexican-American region at the bottom of Texas Rio Grande Valley the nation's top "judicial hellhole" for 2005, a distinction it gives to places where judges uphold "extraordinary" jury awards and seem to favor plaintiffs over defendants.

$32 million? What a country!

The week in review

• DJIA gained 209.80 or 1.88% to close the week at 11347.45. Woohoo!
  

• Nasdaq Composite gained 16.75 or .72% to close at 2342.86.
  

• S&P 500 rose 22.16, 1.72% to close at 1311.28
  

• 10-year Treasury yield took a breather and dropped 0.043 percentage points to finsh at 5.01%. It's still above 5%, but just barely.

Oil gained whopping $4.35 to rise to 75.17/barrel. This week's tank o' black gold set me back $55.

Oil prices are at record highs and we're all feeling the bite at the pumps, but if it makes you feel any better, adjusted for inflation, we're nowhere close to the all-time high. The inflation-adjusted record, set in April of 1980, is $97.55 a barrel.

Cartoon by Daryl Cagle

The third-best job

Providing financial guidance truly is challenging, rewarding and fun but I never imagined that it would rank as the third-best career choice in a survey.

Advisers couldn't have made a wiser career choice, unless they became software engineers or college professors, according to a survey of the best jobs released this month by Salary.com Inc. in Needham, Mass., and Money magazine, published by New York-based Time Inc.

Advisers have average earnings of about $200,000 a year, according to the survey that accompanied the job rankings.

I've always thought that the paint department at Home Depot would be fun. I wonder where it ranks?

Retirement ready?

According to a new survey by the Employee Benefit Research Institue, most Americans are woefully unprepared for retirement.

Although 70% of workers said they saved for retirement, the survey found, 52% had $50,000 or less in total savings and investments, not including their home or any defined benefit plans.

Even more disturbing, three-quarters of workers who hadn't put money aside for retirement said that their assets totaled less than $10,000, according to the EBRI.

Will you be ready to retire?

Cartoon Tuesday

Keefe, The Denver Post

Capitalist of the week: $144,573 per day

Lee Raymond, the recently retired chairman and CEO of Exxon Mobil was paid more than $686 million from 1993 through 2005. That works out to be $144,573 for each day Raymond led the oil giant and it earns him the distinction of "Capitalist of the week".

Under Raymond, the company's market value increased fourfold to $375 billion, overtaking BP as the largest oil company and General Electric as the largest U.S. corporation. Net income soared from $4.8 billion in 1992 to last year's record $36.13 billion.

Shareholders benefited handsomely on his watch. The price of Exxon's shares rose an average 13 percent a year. The company, now known as Exxon Mobil, paid $67 billion in dividends.

That's some pretty handsome corporate performance. Still, is anyone really worth 144 grand each day?

The week in review

• DJIA gained 17.61 or .16% to close the week at 11137.65. Not much to get excited about but at least it's the right direction.
  

• Nasdaq Composite gave up 12.91 or .55% and closed at 2326.11
  

• S&P 500 lost 6.38, .49% to close at 1289.12
  

• 10-year Treasury yield rose .088 percentage points and stands at 5.053%. First time above 5% in years.
  

• Oil gained another $1.93 to rise to 69.32/barrel. I broke the $50 mark on a fill-up this week with mid-grade at $3.09. Yippee.

Is the Enrgy Department in cahoots with big oil?

This week they released a seasonal outlook warning us to expect higher gas prices this summer. While this might not seem like headline news, doesn't it pretty much give oil companies a green light to go ahead and start raising gas prices? Thanks a lot.

Perhaps the Energy Department should just keep its big gas flap shut.

Tax quiz

For the 2005 tax year, the top marginal tax rate is 35% which is, historically, pretty low. What was the highest marginal tax rate in U.S. history?

a) 38%
b) 45%
c) 91%
d) 94%

Cartoon Tuesday

John Trever, The Albuquerque Journal

Capitalist of the week: Hugh Hefner

Hugh Hefner, one of America's great capitalists, celebrates his eightieth birthday today.

"I never intended to be a revolutionary. My intention was to create a mainstream men's magazine that included sex in it. That turned out to be a very revolutionary idea."
- Hugh Hefner

Born and raised in Chicago, Hefner served in the Army toward the end of World War II. He graduated in two and a half years from the University of Illinois Champaign/Urbana while drawing cartoons for the Daily Illinois.

After several jobs in advertsing and publishing, Hef decided to launch his own magazine. The first issue of Playboy hit newstands in December of 1953 and featured the now-famous calendar photo of Marilyn Monroe. That first issue, produced on the kitchen table of Hef's southside Chicago apartment didn't have a cover date because he wasn't sure he could afford to publish another. But that first issue sold more than 50,000 copies and Hefner's entertainment empire was born.

Happy birthday, Hef!

The week in review

• DJIA gained a whopping 10.72 or .10% to close the week at 11120.04
  

• Nasdaq Composite gave up .77 or ..03% and closed at 2339.02
  

• S&P 500 jumped .67, .05% to close at 1295.50
  

• 10-year Treasury yield rose ..108 percentage points and stands at 4.965%
  

• Oil gained another $.76 this week to 67.39.
  

You know it's a slow news week when the biggest story in the media is about the news media itself. Yes, it's true. Katie Couric will become the first woman to solo anchor a network evening newscast. Yawn.

Oh yeah, there was a national championship basketball game on Monday. Congrats to the Florida Gators!

There was some financial data released this week but a quick look at the market stats above would indicate there weren't any big surprises.

Don't forget, there are just nine days left to get your taxes filed!

Regulatory Update

Capital Gains--The House and Senate cannot agree on a provision to extend for two years the 15% maximum capital gains rate. Democrats in the Senate want the provision left out.

Dems looking to raise taxes...who'd a thunk it?

Capital Gains, Part II--Evan Bahy, D-Indiana, proposed last month that fund companies and brokerages be required to report clients' cost information to the IRS making it more difficult for folks to fudge when reporting their gains and losses.

That's a switch, a politician who doesn't trust the people.

Estate Tax--Senate Majority Leader Bill Frist, R-TN, said last month that he intends to bring a bill to the floor of the Senate in May that would permanently repeal the death tax. It came close to a vote in August but was shelved as Congress dealt with Hurricane Katrina.

Catastrophe Savings Accounts--A bill introduced by Rep. Tom Feeney, R-FL, would allow folks to establish separate savings accounts to set aside money for "qualified disaster-related expenses." Investment returns could accumulate tax-free like health savings accounts but with limits tied to deductibles on homeowners insurance.

Can Congress make things any more complicated? Oh well, it's job security for financial advisors.

To keep up with any of these bills, go to The Library of Congress.

Cartoon Tuesday

Daryl Cagle

Today, We Saved Thousands

Mrs. THC's wheels are getting up there in age and mileage. So, here at the humble THC home, car shopping has been on our agenda for awhile. For the last several months, we've looked at a few models and rented a couple of others -- all part of Mrs. THC's process of (very) carefully selecting a new car. She tends to keep a car for a decade or so. So, she takes this process very seriously...and slowly.

The latest model under consideration was the Toyota RAV4. It's a stylish, smallish SUV -- right up Mrs. THC's alley. On a Sunday morning errand, we popped into a local Toyota dealership today to take a closer look. We were immediately greeted by a most helpful salesperson. (I don't recall car dealerships being open on Sundays.) He graciously explained that the RAV4 is too hot to keep in stock. None were available today.

After exchanging brief pleasantries with Toyota-man, we were about to head back to Mrs. THC's aging sedan. Suddenly, the salesman pointed to a moving object in front of the dealership and said, "Wait! You just have to drive this." We turned to see a bit of our youth pulling into the parking lot. It was a very '70s Land Cruiser looking thing. I thought it looked like a little Hummer. Mrs. THC said it was "cute".

Toyota-man introduced us to the 2007 FJ Cruiser. We went for a test drive. We liked it. In fact, we really liked it. We almost bought it.

Yes, we came dangerously close to making the biggest impulse purchase of our lives. Fortunately, cooler heads prevailed. We stepped back, took a few deep breaths, and the search for Mrs. THC's car continues. And, for today at least, we saved thousands.

Still, we're finding ourselves wondering what it would have been like to plunk down $31,000 on a car we'd never heard of and had driven for only a few minutes.

What's the biggest impulse purchase you've made?

The week in review

• DJIA dropped 170.65 or 1.51% to close at 11,109.32
  

• Nasdaq Composite up 26.97 or 1.17% to close the week at 2339.79
  

• S&P 500 lost 8.12, or .62% to close at 1294.83
  

• 10-year Treasury yield rose .184 percentage points and stands at 4.857%
  

• Oil gained another $2.37 this week to 66.63. Ouch.

Strongest first quarter in years. For the first quarter of 2006, the S&P 500 rose 3.7%, its biggest first quarter gain since 1999. The Dow 30, also up 3.7%, showed its best first quarter since 2002 and the Nasdaq Composite shot up 6.1%, its best first period since 2000.

The biggest non-event of the week: The Federal Reserve began the Bernanke era with a quarter-point rate hike, the fifteenth straight for the Fed, putting the target rate at 4.75%. The guvs surprised no one with this and indicated at least one more increase to come in May. Given the Fed's penchant for overshooting neutral, a year from now inflation concerns will be replaced by worries of a stagnant economy and Fed watchers will be looking for a reversal.

Capitalism at its finest--turning white trash to class

Michelle Lamar, a suburban Kansas City gal, has turned being a White Trash Mom into a business, a blog, a book and...who knows what's next?

Lamar calls herself white trash and proud of it. Just read her blog, "White Trash Mom." Her Christmas lights stayed up months after all the gifts were unwrapped. She has mastered the art of driving while talking on her cell phone and yelling at her two kids in the back seat. And sometimes she buys cookies from the store and crumbles them at the edges so they look homemade.

Ain't capitalism great?

Cartoon Tuesday

By Bob Englehart, The Hartford Courant

Home buying on the web

We pay our bills online and shop for financial products on the web. We buy books, CDs and movies on our computers. Many of us do our weekly grocery shopping online.

But would you buy a new house on the web? According to the Prudential California Realty Online Homebuyer's Survey 2006, many of us would.

Thirty-one percent of Bay Area homebuyers believe it is likely that people may consider buying a home on the Internet in the future without ever seeing it in person, according to a survey released today by Prudential California Realty. The findings demonstrated a shift in attitudes as consumers increasingly utilize the Internet in their home search.

"The idea that some buyers may buy a home over the Internet without actually viewing it is not as far-fetched as it would have seemed several years ago as buyers become more active and involved in the transaction through websites," said Sherry Chris, COO of Prudential California Realty. "This is particularly true for the vibrant market in the Bay Area where competition for homes is often strong and good listings can be snapped up quickly."

With Bay Area home prices among the highest in the nation, this idea is especially surprising. Would you spend $750,000 on a home, sight unseen?

The week in review

• DJIA gained a whopping .32 or .003% to close at 11,279.97
  

• Nasdaq Composite up 6.34 or .27% and closed at 2312.82
  

• S&P 500, fell 4.30, .33% to 1302.95
  

• 10-year Treasury yield, down 0.001 percentage points and stands at 4.673%
  

• Oil, gained another $1.49 this week to 64.26. Last week the oil market was worried about Iran, this week it was Nigeria...it's always somethin'.

Google will be added to the S&P 500 on March 31st. It replaces Burlington Resources which is being bought by ConocoPhillips. Haven't we all had about enough hubbub over Google?

New U.S. home sales dropped like a rock in February. Is it a bubble? Call it what you like, there's something going on here.

Money Market rates top 4% for the first time in four years. Now before you get all excited, remember that after inflation and taxes that gives you...um...nothing. Oh well.

In March Madness today we have Texas vs. LSU and UCLA vs. Memphis. Hook 'em 'horns!

Cartoon Tuesday

By Henry Payne, The Detrioit News via Cagle

Happiness research

Saturday's Wall Street Journal carried an interesting story about research that's being done to figure out what makes folks happy. One finding from the Pew Research Center has me scratching my head a bit:

A survey of 3,015 Americans suggested happiness is more likely if you earn more than $100,000 a year, attend religious services and are a Republican.

Okay, the hundred grand, I get. The religious services, I understand. But happiness comes more easily to Republicans? Do the folks in Berkeley know?

Week in review

• DJIA gained 203.31 or 1.84% to close at 11,279.65
  

• Nasdaq Composite up 44.44 or 1.96% and closed at 2306.48
  

• S&P 500, up 25.67, an even 2% to 1307.25
  

• 10-year Treasury yield, down 0.091 percentage points and stands at 4.674%
  

• Oil, gained $2.81 on the week to 62.77 though it fell 81 cents on Friday as fears about Iran lessened.
  

I'm pretty sure there was some other stuff that went on this week but right now I'm just too stunned over my Jayhawks' loss to Bradley that I just can't think what it was.

Cartoon Tuesday

By Gary Markstein via Cagle

A Certain Slant of Light

In December of 2004, A Certain Slant of Light was created to celebrate the birth of a new baby boy by his proud grandfather, Bernard. For the past fifteen months the blog has grown and evolved but one thing has remained constant: Bernard writes passionately about the things in this world he cares deeply about.

A Certain Slant of Light was one of the very first blogs I started reading regularly and I consider Bernard a close friend, though we've never met and likely never will. Ain't the internet amazing?

Now, Bernard is movin' on up from Blogger to WordPress and the new layout is terrific. Go check him out.

Week in review

• DJIA gained 54.75 or .50% to close at 1176.34
  

• Nasdaq Composite lost 40.56 or 1.76% and closed at 2262.04
  

• S&P 500, down 5.65, .44% to 1281.58
  

• 10-year Treasury yield, up 0.079 percentage points and stands at 4.765%
  

• Oil, down a healthy 3.71/barrel to $59.96

The Nasdaq Composite has more than doubled in the last three and a half years, but it's nowhere close to where it stood six years ago last Friday when it hit an intraday high of 5132.52. To mark the sixth anniverary it closed at 2262.04, 56% below its high water mark.

Hold the anchovies and buy a hundred shares of GE

Brokerage firms have to diversify too, ya know.

From InvestmentNews.com:

Merrill yesterday agreed to buy the privately held NPC International Inc., the world's largest franchisee of Pizza Hut restaurants, according to published reports.

The terms of the deal have not yet been disclosed.

NPC currently operates 790 Pizza Hut restaurants and delivery kitchens in 26 states.

Who knows? Maybe you'll be able to do a few stock trades and get a large pepperoni to go.

Cartoon Tuesday

John Branch, The San Antonio Express-News

The money market squeeze

Discount firms like Schwab and TD Ameritrade may have low transaction costs but they still have to make money...

From InvestmentNews.com:

Schwab is supplanting its various money market funds that pay about 3.8% as its default vehicle for sweep balances with a bank checking account that pays 2.2% interest. A primary option is the Schwab Money Market Fund with $42.3 billion in assets.

TD AMERITRADE jacked up its management fees on its default money market funds as of Feb. 24. The Omaha, Neb.-based company allows investors to choose a default option.

The bottom line here is that Schwab and TD Ameritrade have begun to charge clients out the wazoo for money market sweep accounts.

TD Ameritrade charges a management fee of .91% on its Money Market Portfolio--are you kidding, an expense ratio of nearly a point for a money market fund? And Schwab, offering 1.6 points lower yield for a bank sweep account vs. money market? Will clients really put up with this? They will if they are not aware.

Week in review

• DJIA lost 40.26 or .36%

• Nasdaq Composite gained 15.56 or .68%

• S&P 500, down 2.20, .17%

• 10-year Treasury yield, up 0.109 percentage points

• Oil, up $.76/barrel to $63.67, 1.21%

Research in Motion settled the lawsuit that threatened to shut down Blackberry service. Folks, give your thumbs a rest from time to time anyway.

The world's number one chipmaker, Intel, lowers revenue guidance.Rival AMD's been chipping away (sorry) and is beginning to take some significant market share.

Apple launches the Mac Mini and iPod hi-fi. Pretty cool stuff.

The 78th annual Academy Awards are Sunday. My personal choice for Best Picture is "Crash". Of course it's the only one of the five nominees I've seen. Geez, I need to get out more.

Same view, different day

Okay, so we got a little snow beginning in the pre-dawn hours Friday. Mrs. THC and I left the hotel about 7:30 am and took a little hike up to Mirror Lake and back, about 4 miles round trip. What a fun hike in the snow, it's been so long since I've spent any serious time in the cold, white stuff. Market...was the market open today? Do I care?

Decompression

We're taking a few days to get away for some much-needed rest and relaxation but that doesn't mean that I can't take a few minutes to share a photo of Half Dome taken from our hotel room yesterday.

Isn't it interesting that, even a 79 year-old hotel in the middle of a National Park offers high-speed wireless?