Recent Reads of Note -- Political Edition

* Stanley Kurtz, author of the recent Radical-in-Chief, writes at The National Review about Obama's radicalism and why the word fits, contra Michael Medved's opinion: Contra Medved.

* Andy McCarthy writes at The National Review about the grand alliance between ultraliberals/leftists and radical Islamists -- the social compact, the general will, submission, and other folderol:  Jean-Jacques Jihad.

As a perfect illustration of McCarthy's thesis, and as if to immediately provide further evidence of this mutual support  -- what David Horowitz has called the Unholy Alliance --though certainly none is needed, a now former senior executive at uber-liberal National Public Radio, one Ronald Schiller, famously caught (link; link) recently on undercover video bemoaning Jewish Zionist control of the media to radical Muslims whose donations he was seeking, is, according to Wikipedia (link), Jewish, and, according to various internet comments, gay.  Gay Jews don't seem to fare well under the sharia of radical Islam, but then American liberalism's cultural self-loathing trumps all.

* Mark Steyn writes in The New Criterion on Western cultural suicide:  Dependence Day: "If I am pessimistic about the future of liberty, it is because I am pessimistic about the strength of the English-speaking nations, which have, in profound ways, surrendered to forces at odds with their inheritance."

John M Greco

Obama the Anti-War Candidate Starts Another War

Obama's been a busy guy.  He barely had time after an invigorating 18 holes to fill out his March Madness basketball brackets before rushing off to vacation in Brazil.  But while scurrying out the door he did take a moment to order the US military into yet another war against a Muslim country, our third at last count.  Supposedly a big factor was the urging of the Arab League, but that bunch of upright citizens of the World definitely do not have Obama's back (link).  Another war for oil, as the liberals would say?  I need to say it for them since they're not saying it now.  How many Americans might die for our intervention in a tribal civil war between bad guys and maybe, maybe not quite such bad guys?  [Addendum:  Per Andy McCarthy at National Review (link):  "[T]he Libyan “rebels” ... refer to their battle as “the jihad” — Islamic holy war .... and, of course, screaming, “Allahu Akbar!” as they fire their guns into the air."]  Why does everyone in the "Arab street" seem to hate Westerners in general and Americans in particular except when an air strike is needed against tribal enemies?  The only thing, the only thing, of value I thought Obama would bring is an end to the wars in Afghanistan and Iraq, and yet not only are we still there, he's doubled down in the former.  I certainly never expected him to attack another country, and yet now we're bombing and killing people in Libya. 

Obama received prior approval from the Muslim Arab League, but neither sought it nor received it from the US Congress, to launch an attack on country totally nonthreatening to the USA with no apparent national interest involved.  Obama the Senator, as anti-war candidate:  "The President does not have power under the Constitution to unilaterally authorize a military attack in a situation that does not involve stopping an actual or imminent threat to the nation." (link)

Well, I'm waiting for all the liberal condemnation of Obama the warmonger, starter of illegal hostilities, but I'm not holding my breath.  Bush with blood on his hands, Bush/Cheney the war criminals, BushHitler the baby killer.  Impeach Bush.  What about all the terrorists this will breed?  What about closing Gitmo, still open over two years into the age of Obama.  What about the fierce moral urgency of change? 

Or was it all just political?  Of course it was.

John M Greco   

Annals of Inanities -- Obama Edition 2

* Obama's State Department, run by one Hillary Clinton, is attacking (link) the US Military, headed by Commander-in-Chief Obama, for allegedly mistreating its prisoner Pfc. Bradley Manning, the soldier who allegedly leaked reams of secret, sensitive material to WikiLeaks.  Now the spokesman for the Obama/Clinton State Department is taking the fall (link).  Clinton and her minions keep forgetting that a Democrat is now president, not a Republican -- no need to fabricate and smear anymore.

* Everyone knows that the Social Security system is a pyramid scheme, where today's contributions from some people are used to pay today's benefits to others.  There is no Al Gore lockbox, there is no money set aside -- it's all a fiction.  And yet, and yet, the unserious Barack Obama's position was recently reaffirmed:  there is no problem because the trust fund, which we all know does not exist, is "solvent" until 2017.  This incessant effort to fool the foolable and the inattentive -- Charles Krauthammer deconstructs it here.

* Obama has just said that his administration is "encouraging offshore (oil) exploration and production" (link).  No sentient being could possibly believe an ounce of this.  Obama doesn't just subscribe to the Big Lie theory, he's an underwriter.

* Obama's buddy Attorney General Eric Holder, who recently referred to blacks as "his people" (link) in defending himself against serious charges of reverse racism, is now requiring the Dayton police department to lower its testing requirements so that more blacks can pass the test.  Why not just eliminate testing all together?  Why do policemen and other public servants need to know anything at all?

John M Greco

Recent Reads of Note -- Daniels & Steyn

* In the March 2011 New Criterion, a great journal of criticism, physician and author Anthony Daniels, one of my favorites who sometimes goes by Theodore Dalrymple, writes compellingly of an experiment of his, motivated by a regret of formal training in literature, in which he somewhat randomly selected two slim books of WWII-era poetry, by two poets unknown to him and seemingly most anyone else, from a dusty shelf in an old used bookshop to see if he could discern whether the poetry was any good.  He could and, by chance, it was.  On the Doorstep of Valhalla.   Four fragments I will return to enjoy:

One of my many regrets—and there comes a time in life when regret is almost inseparable from memory itself—is that I received no formal literary education, at least not after the age of sixteen....  Even now, nearly half a century later, as I walk through the woods around my house in France and the sunlight comes variegated through the leafy canopy, I cannot but think of the poem that begins: “Glory be to God for dappled things—/ For skies of couple-colour as a brinded cow.”

To say that the verse of both men has been forgotten is not to court contradiction....  I felt slightly nervous at being moved by both, as if I lacked the discrimination to realize that they were rightly consigned to the literary equivalent of Trotsky’s dustbin of history, in other words to the shelves of the unsaleable in a shop that was destined to close when the slender resources of its new owner ran out.

It is difficult not to see in the contrast between the two poets the caesura in European culture, or rather sensibility, caused by the First World War; Elwes could not see that his generation was sacrificed for nothing; Monahan could see nothing else. Oddly enough, I find myself able to sympathize on both sides of the caesura, with both of Elwes and of Monahan—nostalgic for the past, I am immersed in the modern.

Just as Elwes saw the war in clear moral terms as Monahan did not, so too he saw love as lasting and permanent, as Monahan did not. It is as if enchantment and disenchantment were lenses through which the two of them looked at the world, each lens no doubt with its power of distortion, but each also capable of revealing truths that the other cannot.

* The inimitable Mark Steyn writes trenchantly, sarcastically, and somewhat forlornly about the recent Islamist terrorist attack on American servicemen in Germany, citing Western fecklessness and unrelenting demographic arithmetic in Arid Uka’s Gratitude.  Excerpt: 

According to Bismarck’s best-known maxim on Europe’s most troublesome region, the Balkans are not worth the bones of a single Pomeranian grenadier. Americans could be forgiven for harboring similar sentiments after the murder of two U.S. airmen in Germany by a Kosovar Muslim....  Remember Kosovo? Me neither. But it was big at the time, launched by Bill Clinton....  And the Left didn’t mind at all — because, for a modern Western nation, war is only legitimate if you have no conceivable national interest in whatever war you’re waging....  A decade on.... a young airport employee is so grateful for what America did for his people that he guns down U.S. servicemen while yelling “Allahu akbar!”

John M Greco

Obama Gets Tough on Leakers of His Team's Secrets. Surprise!

Obama has been coming down very hard on federal workers who leak government secrets to the press.  But remember when liberals said leaking was one of the highest forms of patriotism?  Apparently only if it might embarrass Republicans.

From the liberal website Politico (link):

The Obama administration, which famously pledged to be the most transparent in American history, is pursuing an unexpectedly aggressive legal offensive against federal workers who leak secret information to expose wrongdoing, highlight national security threats or pursue a personal agenda....  That’s a sharp break from recent history, when the U.S. government brought such cases on three occasions in roughly 40 years....  But legal experts and good-government advocates say the hard-line approach to leaks has a chilling effect on whistleblowers, who fear harsh legal reprisals if they dare to speak up. 

GW Bush was derelict in his failure to stifle leakers of national security secrets, intimidated, I think, by the liberal media elites.  Now here's one Bush policy Obama has actually changed.  Whistleblowing on Democrats can't be tolerated.

John M Greco

Annals of Inanities -- Obama Edition 1

* Recently the Obama-appointed Attorney General of the United States, one Eric Holder, who happens to be black, was before a US House committee testifying on his refusal to prosecute the perpetrators in the well-documented black-on-white Philadelphia voter intimidation case.  In justifying his actions, he referred to blacks as "his people." (link; link; link)  Apparently whites and Asians are not "the people" of the Attorney General of the United States.  That post-racial Obama stuff has always been smoke and mirrors.  But my liberal friends assure me that Obama loves America and is a great patriot, so I feel better.

* Obama lieutenant Katherine Sibelius, the head of HHS who runs Medicare and is one of the point persons pushing Obamacare, has finally admitted that the Obama team's figures on the purported financial savings from their Obamacare and Medicare "reforms" are fake (link) because of double-counted "savings".   Republican Rep. Pitts said:  “The same dollar can’t be used twice [in counting savings].  This is the largest of the many budget gimmicks Democrats used to claim Obamacare would reduce the deficit.”  This was obvious from the very start but Obama and his minions have kept lying about it to fool the foolable and the inattentive. But my liberal friends assure me that Obama loves America and is a great patriot, so I feel better.

* When a US Border Patrol agent was shot and killed last year in an altercation with armed illegals, apparently there was speculation on the internet that BP agents are required by the Obama Administration to first use bean bag rounds (whatever those are) when force is necessary against illegals with real guns.  At the time, Obama's crack Homeland Security team dismissed such (link) as "increasingly bizarre internet-fueled rumors".  Well, now the Obama team finally admits (link) that indeed our agents fired bean bag bullets while the bad guys fired real ones.  Good grief -- it's as if Obama and his acolyte Napolitano would rather our agents err on the side of getting killed rather than risk harming hostile illegal aliens armed with real guns and real bullets.  But my liberal friends assure me that Obama loves America and is a great American patriot, so I feel better.

* Obama preached incessantly in his campaign about the "fierce moral urgency" to closing the Gitmo prison for Muslim terrorists and signed an order hours after becoming president to effect just that.  Though his acolytes still hope for that change, not only is Gitmo still open two years later but now Obama's appointee Eric Holder of Justice (see above) apparently feels that Muslim terrorists are also "his people" because he's keeping them around in Gitmo another year or two (link).  And our troops are still in Iraq and Afghanistan -- another signature Obama promise turned to dust.  But my liberal friends assure me that Obama loves America and is a great American patriot, so I feel better.

* A German-born Kosovo Muslim, feeling so indebted to the American military for protecting his and other Kosovo Muslim families against the Christian Serbs a few years back, showed his gratitude by opening fire on American troops in Germany, no doubt presuming they were either Christians or Jews, shouting the de rigueur "God is Great" in Arabic of which we are now so familiar.  He would have killed more but his gun malfunctioned, which is why so many Muslim terrorists prefer beheadings with swords -- less prone to jamming.  The American Commander-in-Chief, who grew up in some unique family cultural blend of Islamic-tinged atheistic communism, sort of a red diaper baby with a Muslim motif, announced he was "saddened" by the "tragic event."  Just as with the Ft. Hood massacre by another jihadist, the words "Islamic" and "terrorist" are not part of Obama's lexicon.  The great Mark Steyn takes him down here (sample: "As any Homeland Security official can tell you, “Allahu akbar” is Arabic for “Nothing to see here.”).  But my liberal friends assure me that Obama loves America and is a great American patriot, so I feel better.

John M Greco  

Investing Solo – Preferred Closed End Funds & JPS

In the last couple of months I’ve written a few posts here (link) about how I’ve been increasing the allocation to floating rate securities in my debt portfolio in anticipation of rising interest rates -- floating rate senior loans, both an unleveraged mutual fund and leveraged closed end funds, augmented with moderate positions in individual floating rate equity preferred stocks and the variable rate bond CEF GFY. My FR exposure is now about 10% of my debt portfolio.

However, since some market mavens think that the sluggish economic recovery will keep the Fed’s interest rates low for some time, perhaps years, not only am I holding firm on most of my fixed rate debt (my last post on the Pimco CEFs managed by Bill Gross is here) I’ve actually added to it a bit in the past couple of weeks. I’d like to think this approach resembles more a barbell than a dumbbell.

What continues to attract me are so-called preferred securities, a motley crew that consists of both traditional equity preferred stocks and the somewhat newer so-called hybrid preferreds, which are actually bonds, either de jure (exchange-traded bonds) or de facto (trust preferreds and trust certificates). The attraction is their high yield, pure and simple. The hybrid preferreds, what I prefer to call exchange-traded debt, are mostly fully taxable but “provide the highest yields of any investment grade fixed income security,” according to preferred fund manager Donald Crumrine in a recent interview (link) published by the Wall Street Transcript. Moreover, the equity preferreds are taxed at the qualified dividend rate, currently 15%, as are also trust preferreds from foreign banks in what appears to me to be a strange quirk in the tax laws.

There are some newer ETFs in preferreds but I prefer the CEFs for the enhanced yields that leverage provides. I figure if I’m going to take the interest rate risk of preferreds why not double down and add some leverage to juice the yields. There are three families of preferred CEFs – Nuveen, John Hancock, and Flaherty & Crumrine, each with four offerings. At my recent look at the metrics of all of them, which I array in table form, I once again find the Nuveen funds most attractive in the metrics I value, which include a high ratio of net investment income to distribution, positive undistributed net investment income worth at least a month’s distribution, sizeable discount to net asset value, moderate leverage, no destructive return of capital, and good average portfolio credit. At this point in time, I like the Nuveen trio of JTP, JPS, and JHP best, and have recently found that JPS, which happens to be the largest of the three, has had the most attractive combination of size, discount, and distribution, so it’s the one I’ve been adding to of late.

Since the relative attractiveness of the CEFs can vary over short periods of time, especially since the discount can change daily, when I decide to add to a position I might find one CEF relatively more attractive than the others on that day. In this Nuveen family, I also hold JTP.

As of yesterday, JPS sports an annualized distribution of 8.1% trading at an 8.0% discount to net asset value.  This discount is well below the 5-year average, usually an attractive feature when other investment indicators are favorable.  Nuveen represents at its web site that about 37% of the JPS holdings are equity preferreds, which are taxed at the 15% rate. My back-of-the-envelope calculation is that this translates to a fully taxable equivalent yield of about 9.0%. I’ve got moderate credit risk, more so on the equity preferreds, significant interest rate risk, and the looming phase-out of bank trust preferreds (which will offer capital gains to the extent that the CEFs’ cost bases are below par but reduce the investable universe of hybrid preferreds). But for the high yield, I’m staying modestly invested in this space with some alpha money.

I’m an individual investor with no background in finance or securities, writing things down to help organize and clarify my thinking. Of course, nothing I say constitutes investment advice of any kind – merely an account of my personal observations and decisions. My core portfolio is a conservative and diversified mix of equity and debt mutual funds, ETFs, and some closed-end funds (CEFs) across investment styles, management firms, and accounts, and I invest a relatively small amount (about 10%) somewhat more aggressively in the perhaps ultimately futile pursuit of alpha.

Mike Parenti

Wisconsin Public Unions vs Taxpayers -- Dispatches from the Front

Reports from the front on the battle in Wisconsin between over-compensated public union workers and the over-extended taxpayers who foot the bill:

Howler.  A New York Times article (link) proclaims that a new Rasmussen poll on the dispute may be biased (presumably against the union side).  Yes, that New York Times, the apotheosis of bias, accusing someone else of it.  Well, I guess if anyone can recognize tripe it would be a tripe peddler, although Rasmussen is about the most trusted name in polling.  The only dupes likely to relish this serving of offal are the dwindling number of readers the New York Times has left.

The difference between lightning and a lightning bug.  Supporters of the union side are want to blur any distinction (link) between public and private unions -- hence the railing against "corporate power" and "big money." In fact, the differences between public and private are fundamental, significant, and in the Wisconsin dispute, dispositive (as the lawyers say).

Hmmm -- So that's why all those protesting teachers don't understand that they're grossly over-compensated:  "Only 39% of the 8th graders in Wisconsin public schools are proficient or better in mathematics, according to the U.S. Department of Education, despite the fact that Wisconsin spends more per pupil in its public schools than any other state in the Midwest." (link)

Uh-oh.  The unions have lost liberal Richard Cohen writing in the liberal Washington Post (link):  "It was one thing when unions went after giant corporations run by guys who played golf at restricted clubs. But when it comes to government workers, we are the boss and we pay the bill. To quote what Sam Spade told the woman he loved in the "The Maltese Falcon," "I won't play the sap for you." When it comes to public-sector unions, my sentiments exactly."

Welcome to the future -- a preview of medical care if the Democrats have their way:  At least three faculty physicians from the University of Wisconsin Family Medicine Department are filmed proudly handing out confirmation of illness statements to union protesters so they could obtain excused absences from their teaching duties, all proving too much even for a big liberal writing in the liberal Atlantic (link).  Hey, who says we need to do a careful interview and physical examination of the patient to make a diagnosis?  That old school stuff discriminates against doctors who can't do physical exams, or don't know how, to say nothing about how needing a doctor's statement discriminates against those who aren't actually sick.  Medical ethics is a retro-capitalist construct.  No doubt the UW Dept of Family Medicine is a hotbed of support for Obamacare. 

So that's why our school maintainence bill is so high.  Wisconsin unionized teachers drop their garbage where they stand (link).  Overheard by a mind reader: "hell, cleaning up after myself isn't in my union job description, and after all, I'm creating jobs for unionized clean up workers." 

But didn't Obama say all that violent rhetoric was off limits?  So much for the liberals' new age of civility -- (link).

Who are these guys?  Unions to bus in outside agitators to join Wisconsin protests (link).  Boy, that side really knows how to community organize.
 
John M Greco 

Related Post:
Wisconsin = Ground Zero in the Escalating Struggle Between Hard-Pressed Taxpayers & Coddled Public Workers

Reflections on the Devolution in Chicago

The Wall Street Journal reported (link) this past week on some new data from the U.S. Census Bureau:

A larger-than-expected exodus over the past 10 years reduced the population of Chicago to a level not seen in nearly a century. The U.S. Census Bureau reported … that during the decade ended in 2010, Chicago's population fell 6.9% … [to] fewer than [was] reported back in 1920…. [T]he recent recession accelerated a migration both to the metropolitan area's farthest suburbs and to the Southern U.S…. The influx of residents to outlying areas could … —particularly minorities—could make those regions more politically diverse. For instance, said University of New Hampshire demographer Kenneth Johnson, "DuPage County could become less Republican."

Chicago’s retiring Mayor Daley, a Democrat and the longest serving mayor in city history, having just surpassed his father in that regard, has been popular not so much because of what his is but rather because of what he is not – a worse alternative. One must not conflate popularity with cost-effectiveness.

Despite the Daley Democrats the steady migration to the suburbs and the South continues. Residents are voting with their feet in search of safer neighborhoods, cheaper and more honest government, better schools, more reliable services, and, of course, better job prospects in areas more friendly to the businesses that maintain and create them.

And to what new lands are these residents fleeing? To towns and states where the policies and values of Republican and conservative voters predominate. But in what should be fodder for a million PhD theses, in a triumph of will over experience, of desire over judgement, many of these refugees from failed Democrat polities don’t miss a beat and continue voting for Democrats from their new homes, against the very Republicans who made their new neighborhoods worth moving for. Validating the principle that you can fool some of the people all of the time, they continue to vote for Democrats who promise them more things with less accountability.

The foundation of a democracy rests on the wisdom of its people, and in the wisdom of such citizens lies the hope of our Republic.

John M Greco

Related post:
Democrat Voters Migrate to Republican Areas For Better Jobs, Safer Neighborhoods, and Better Services, But Then Still Vote For Democrats; Go Figure

Wisconsin = Ground Zero in the Escalating Struggle Between Hard-Pressed Taxpayers & Coddled Public Workers

Wisconsin has become ground zero in the escalating struggle between private-sector taxpayers and the government workers who live large off their labors.

Study after study in recent years has shown that public sector workers not only have higher job-specific wages than their private counter-parts but have much richer benefit packages as well, including pensions that private sector taxpayers can only dream about.

States and local governments are struggling mightily in the wake of the Great Recession, and some are functionally bankrupt. The largest single driver of this crisis is well known -- wages and benefits to public workers, who are usually represented by a union.

The new Republican governor of Wisconsin, Scott Walker, supported by a Republican majority in both houses of the state legislature, is finally standing up for the people who actually foot the bill for the largesse extended to government employees. He is proposing that benefits for state workers begin to come in line with those of the private workers who pay the bills.

Most private workers, the taxpayers, pay a big piece of their health care insurance costs, while I read that Wisconsin public workers, not unlike their counterparts across the country, pay little to nothing for theirs. Karl Rove states on the Hannity show that in Wisconsin “virtually every state employee pays zero” into his/her retirement plan. Meanwhile, in Illinois, a state with worse finances than Wisconsin, the number of retired public workers with pensions over $100k per year is skyrocketing. This is grossly unfair and unsustainable.

Unionized teachers are now mobbing and agitating in Madison, the state capitol, replete with ugly, violent imagery and revolting disrespect for the environment (Ann Althouse posts:  link; link; link).

President Obama, now lying (link) in speeches about cuts in his new federal budget plan, is calling this attempt by Wisconsin taxpayers to save their state from destruction “an assault on the unions.” In Illinois, Democrat Gov. Pat Quinn, who made his name posing as a taxpayer advocate (falsely, in retrospect), is proposing, for the state with arguably the worst finances in the country, I kid you not, a budget for the next fiscal year with increased spending and borrowing (link), even after a recent 67% hike in the personal income tax rate. Denial ain’t just a river in Egypt.

This struggle needs to come to a head, and the sooner the better for our country. It can’t go on any longer. Either the taxpayers who foot the bill or the public workers who live off their labors will be in control. With one we recover and go forward, with one we devolve into bankruptcy and chaos.

John M Greco

Related Post:
Wisconsin Public Unions vs Taxpayers -- Dispatches from the Front

Annals of Government-Run Enterprises: Why Is This Train Late?

Accurate transcription of an automated announcement the other day on a Chicago Metropolitan Rail Authority commuter train on the way to the Loop:

“This train is operating approximately 30 minutes late due to late arrival of equipment due to earlier delays.”

I kid you not.

And some of us want these people run our health care system.

2/13/11 -- Addendum:  Lest anyone thinks this message was a one-off, in fact it is one in the railroad's standard pre-prepared repertory that I have heard many times over the years. 

2/13/11 -- Addendum 2:  From the Associated Press (link):  "Despite plenty of warning that last week's blizzard was on its way, officials of Metra say the Chicago-area commuter train system wasn't prepared to deal with the storm. They also told the Chicago Tribune on Friday that they didn't get the word out about reduced services and long delays."

As Glenn Reynolds of Instapundit would say -- We're in the very best of hands.

John M Greco

Does Obama Support Protestors Against a Repressive Islamic Regime? It Depends

In an authoritarian Muslim country, young anti-government protesters clamor in the streets against a repressive government. Shouts for democracy are heard. Military action is feared. One side is anti-American, the other side is at least a tactical ally.  Which side does Obama support?

Well, in Iran he supported the government against the protesters, and in Egypt he supported the protesters against the government. In Iran the vicious and virulent anti-American group Code Pink supported not the protesters but the hard-line Islamist Iranian regime, and even visited the country recently as guests of the ruling mullahs (who were taking a well-deserved break from their exhausting duties of hanging gays and whipping to death 14 year old rape victims); but for them in Egypt, there too it was different. Hmmm. What could be the theme?

Of course, to anyone sentient the theme is that whichever side hates the West in general and hates America and Israel in specific is the side that gets the support of Obama and Code Pink (the leaders of which have already spent a nice day at the White House visiting with their friend Obama). There’s no other way to reconcile Obama’s lack of support for anti-government protesters in Iran and support for anti-government protesters in Egypt. No other way.

Peter Kohanloo and Sohrab Ahmari comment on this inconsistency at The Weekly Standard (link):

How can self-proclaimed “progressives” support one set of Muslim reformers, while so coldly abandoning another? The contradiction is a symptom of a deeper philosophical quagmire born of a sense of guilt felt by some Westerners for past sins, both real and imagined, committed against the non-Western “other.” Western guilt yields a state of perpetual self-loathing, which in turn leads its victims to celebrate any anti-Western cause as morally worthy. Thus, when Egyptians--rightly--rebel against a pro-American autocracy, their cause is automatically perceived as just. However, if Iranians rise up in pursuit of similar goals against a far worse, anti-American and totalitarian regime--one that murders its own citizens in the name of God--Americans are asked to stay silent. After all, they have “oppressed” Iran in the past.

Obama had a chance, by supporting the anti-government protesters, to help overthrow the vicious, radical anti-American regime in Iran. He took a pass then, but now in Egypt he’s suddenly interested in the rights and safety of the young people in the streets. With Obama it’s easy to predict where he’ll stand – just find the side that’s more in our interest to support and he’ll be somewhere else.

John M Greco

Republican House Leaders Stun America in Renouncing Their Own Campaign Pledge on Spending Cuts; Say It Ain’t So Paul Ryan

Republican House Leaders John Boehner, Paul Ryan, and Eric Cantor, et alia, have announced their new spending plan that falls way short of the spending cuts they have been pledging for so long and are so needed to deal with the dangerous national debt level.

From Emily Miller at Human Events (link):

[Republican House Budget Committee Chairman Paul] Ryan’s budget falls short of the House Republicans’ promise to cut back to 2008 spending levels. During the midterm elections campaign season, they promised in their Pledge to America to “cut government spending to pre-stimulus, pre-bailout levels, saving at least $100 billion in the first year alone." However, Ryan’s budget sets discretionary spending for FY 2011 at $42 billion higher than FY 2008.

Hugh Hewitt, as outraged as I am, has details and comments here.

How in the world could these guys have the audacity to do this, after all that has happened in the past year, after all the dire warnings about the threat of the exploding debt under Obama and the Democrats, after the Tea Party grass roots revolt against spending, and after their own promises?

Yes, I realize that they will attempt to justify their perfidy with Beltway-speak loaded with insider and technical lingo no one outside of Washington DC understands about how all this really isn’t as bad as it looks.

This is simply astounding. I read this evening that many elected national Republicans are in open revolt, and so perhaps they can bring Boehner, Cantor, and Ryan to their senses and rescue them from their own political suicide. Of course, even if honest and reality-based Republican leaders convince them to honor their word, they will remain deeply tarnished by this stunning episode.

John M Greco

Profiles in Principled Liberalism

Fealty to principles versus the grasp of power to control and mold the hoi polloi?

Ultraliberal advocacy organization Common Cause in 2005 on the subject of Democrat senators possibly using the filibuster to block Republican Bush’s judicial nominees, via per Jonathan Alter at The Volokh Conspiracy (link) by way of Instapundit:

Common Cause strongly opposes any effort by Senate leaders to outlaw filibusters of judicial nominees to silence a vigorous debate about the qualifications of these nominees, short-circuiting the Senate’s historic role in the nomination approval process.

Ultraliberal advocacy organization Common Cause in late 2010 on the subject of Republican senators possibly using the filibuster to block Democrat Obama’s judicial nominees, via same source as above:

the filibuster of judicial nominees threatens to “cripple our federal judiciary”

You can’t make his stuff up.

For some, truth is not about consistency to principles or even reality but rather about whatever serves to advance the Cause.

John M Greco

Chrysler Boasts that Its Cars Are Made by Detroit Union Workers. Yes, That Detroit, Those Workers.

I’m not making this up. Honest.

In a very slick and undoubtedly very expensive commercial aired during yesterday’s Super Bowl game, car-maker Chrysler boasted that its cars are made in Detroit. The tag line is “Imported from Detroit.” Yes, that Detroit. Made by those very same union workers notorious for their unique world-record-breaking ability to combine extremely high pay with extremely low quality. Made by those same workers who, along with fellow residents of similar mentality, have turned Detroit into a lower-rung third-world city right here in America. Oh yea, those are just the people I want to make the next car I drop $30 grand to buy. Sure.

Chrysler is of course now mostly owned by the unions after it was stolen from its creditors in an ersatz bankruptcy by Obama and given to them in one of the most egregious examples of political thuggery in American history. Then Obama gave Fiat what was left with the directive to work with the unions to try to make something of the corpse, no doubt to be aided with more money from Obama down the road.

The union brain trust thinks the way to induce me to buy one of their cars is to remind me, to emphasize to me, that their cars are manufactured by Detroit union workers. Of course, instead they should be doing everything they can to trick me into believing that Chrysler cars are made by someone else – anyone else. These union owners are either much dimmer than anyone had previously imagined or are certifiably delusional, and are likely both.

John M Greco

Some related posts:
The Obama Chrysler Confiscation – One Year Later
Obama-run General Motors Guilty of “Elasticizing the Reality of Things" about Repaying Its TARP Loan
Obama, the Car Companies, and the Rule of Law
Detroit's Population Crashes as Ignorant Residents Flee the Liberal Paradise

Remembering Ronald Reagan, at 100

Today we celebrate the 100th anniversary of the birth of one of America’s and Illinois’ greatest sons – Ronald Reagan.

He was born 100 years ago today in Tampico, Illinois, and grew up in various places in the northern part of the state, attending high school in Dixon and finally graduating from Eureka College with a degree in economics and sociology.  After working in radio broadcasting "live" Cubs games from a studio in Iowa, Reagan moved to California to become an actor, becoming perhaps best known for his film portrayal of Notre Dame football player George "the Gipper" Gipp in Knute Rockne, All American.  He was president of the Screen Actors Guild, became a Republican (“I didn’t leave the Democratic party – the Party left me”), served as governor of California for two terms, and was twice defeated for the Republican nomination for president.  Then in 1980 he tried for a third time, and won at last.  He became president of an America humiliated by the Iranian hostage crisis, fearful of aggressive communism, unnerved by rampant inflation, dazed by the Carter Administration, and apprehensive about the future. 

Larry Kudlow, who as a young man worked in the Reagan Administration, recounted the Reagan legacy on his show the other day:

Ronald Reagan saved America. Ronald Reagan saved the world. His economic policies of low tax rates, light regulations, and a king dollar, vanquishing inflation, firing the striking air traffic controllers, and limiting domestic spending – all that basically launched a 25 year economic boom and rescued us from the malaise of stagflation.

With his massive military buildup, his missile defense system, his tough diplomacy, and his evil empire battle cry, Reagan defeated Soviet communism forever without even firing a shot.

He was a tough minded optimist who believed in American exceptionalism and freedom. He saved our future.

Let me repeat my favorite of the Gipper’s many great lines: the best is yet to come.

John M Greco

Investing Solo – Bill Gross’s PTY and Its Sister Closed End Funds PFN, PFL, and PCN

When will interest rates really start to rise? How much inflation do we really have? Read the WSJ or watch the Kudlow show and see the experts’ answers range from soup to nuts. I pay, however, particular attention to Bill Gross of Pimco, who, in the annual Barron’s roundtable interviews (link) published last month and in a recent post for Pimco investors (link), opines that the Fed will keep interest rates low for a good while longer, however injurious such rates are to savers and pensioners, in the interest of propping up assets, particularly stocks and real estate, for the benefit of banks and financiers. He advises us mere mortals to adjust to the interest rate realities and adapt our fixed income strategies. Gross: “Once [quantitative easing] disappears, how long will the federal-funds rate stay at 25 basis points?…. For a long, long time, I think. Short-term rates will stay there for at least two years and maybe three, because of high unemployment, excess capacity and, at the moment, an inherently low inflation rate. There would be no rationale for the Fed to raise interest rates other than to counter an attack on the dollar.”

To that end, in Barron’s he once again recommended one of the Pimco diversified taxable debt closed end funds (CEFs) – PTY. Gross’s argument: “[I]f you don't want to own assets [like treasuries or money market funds] yielding negative real rates [interest rates net of inflation], why don't you borrow at such rates, or find companies that do?” I own two sister funds to this one – PFN and PFL, the former of which in the June 2010 Barron’s Gross called a “look-alike” to PTY. Not unexpectedly, the price of PTY shares jumped high, while the unmentioned PFN and PFL only hopped up a bit, despite only modest to moderate differences among them and the fourth sister of the quartet, PCN. I don’t know why Gross mentions only one of them at a time in these interviews rather than discussing the quartet as a whole. In fact, the average durations of the PFN and PFL portfolios are shorter than PTY and PCN, giving them a little more safety should interest rates rise a lot from here. For me, when I first bought into PFN and PFL I liked their valuation metrics a bit better than those of PTY and PCN, and especially given the run up in share prices recently that still seems the case to me now.

All of these funds to my eyes have exceptional metrics among debt CEFs – particularly for me net investment earnings well in excess of monthly distributions, a substantial cushion of undistributed net investment income, and insignificant amounts of the subjectively valued “level 3” securities. The portfolios are mostly corporate bonds, both investment grade and high-yield, and mortgage-backed securities. All these funds are managed by Gross himself (he’s also a large personal shareholder) and have great track records, employing leverage to achieve regular distributions of well over 7% annually plus a history of special one-time year end payouts on top of that.

Of concern is the particular risk seemingly on everyone’s mind right now -- future interest rates, but again, Gross thinks they’ll stay low for quite a while longer. Also, this quartet of CEFs now trade at a premium to net asset value, but I suspect that’s because of Gross’s great track record as a fund manager and because the annualized rate of monthly distributions does not take into account special year-end distributions.

I have been taking a hard look at my fixed-rate funds not expressly intermediate-term in focus that I have left after my reallocation over the past year almost completely out of long-term funds. I look at PFN and PFL as essentially intermediate-term funds with great fundamentals, yields, and management, but with a fixed rate portfolio. After re-assessing the rewards versus risk, I’ve decided to hold firm with them despite the recent run-up in price to mild premiums over net asset value and the inherent interest rate risk.

I’m an individual investor with no background in finance or securities, writing things down to help organize and clarify my thinking. Of course, nothing I say constitutes investment advice of any kind – merely an account of my personal observations and decisions. My core portfolio is a conservative and diversified mix of equity and debt mutual funds, ETFs, and some closed-end funds (CEFs) across investment styles, management firms, and accounts, and I invest a relatively small amount (about 10%) somewhat more aggressively in the perhaps ultimately futile pursuit of alpha.

Mike Parenti

PTY profile at Nuveen’s CEF Connect web site

Related Posts:
Investing Solo – Floating-Rate Debt - GFY
Investing Solo – Floating-Rate Debt
Investing Solo in Floating-Rate Preferred Stocks

Investing Solo – Floating-Rate Debt - GFY

I’ve been writing about my search for suitable floating-rate debt securities to which I can allocate a part of my debt portfolio. I’ve previously posted some thoughts about floating-rate (FR) equity preferred stocks (link), particularly MET-A and HBA-D, and exchange-traded debt securities (link), particularly the exchange-traded bond PFK and the trust preferred issue UBS-D.

I’ve come to like the closed end fund GFY run by Legg Mason. It invests, with a pledge of at least 80% of assets, in variable rate debt, such as mortgage-backed securities, IG and high yield corporate bonds, senior loans, and emerging market debt, and derivatives related to these securities; no FR equity preferred stock, however. Much of this portfolio, about 45% as of last fall, is as expected below investment grade. I like the picture from the last annual report (link), dated September 30, 2010: portfolio earned interest and dividends well in excess of the CEF’s distributions, specifically an impressive 134%; solid positive capital gains and net from derivatives; a very decent amount of undistributed net investment income on the books; and no return of capital. To my read, about 82% of its net realized gain came from portfolio interest and dividends, which I like, with only the remaining 18% from net capital gains and derivative, swap, and currency transactions.  The Legg Mason GFY "Fact Card" (link) lists a security weighted average life of 5.6 years.  As of yesterday it pays a monthly distribution at an annualized rate of 4.1% and trades at a very attractive 8.4% discount to net asset value. Interestingly it does not employ leverage, despite being the kind of fund -- one with a variable rate portfolio that could maintain an interest rate spread over borrowed capital as interest rates rise -- where one might expect it and like to see it. One limitation – it’s a fairly small fund with relatively low trading volume. What I see as the risk/reward ratio is attractive for a modest investment, and I’ve begun accumulating some shares on dips.

I’m an individual investor with no background in finance or securities, writing things down to help organize and clarify my thinking. Of course, nothing I say constitutes investment advice of any kind – merely an account of my personal observations and decisions; I do not vouch for the accuracy of any representation -- every investor must do his/her own due diligence. My core portfolio is a conservative and diversified mix of equity and debt mutual funds, ETFs, and some closed-end funds (CEFs) across investment styles, management firms, and accounts, and I invest a relatively small amount somewhat more aggressively in the perhaps ultimately futile personal pursuit of alpha.

Mike Parenti

Related Posts:
Investing Solo – Floating-Rate Debt
Investing Solo in Floating-Rate Preferred Stocks

The Tucson Murder Rampage, Liberal “Truth”, & Liberal Viciousness

The bullets of the madman had barely stopped flying in Tucson earlier this month when many prominent liberals rushed to blame the tragedy on conservatives, despite not only the absence of a shred of evidence of such but despite early anecdotes that in fact he was an atheist, a left-wing pothead, and an anarchist, even as if had the shooter held conservative political views they could possibly be blamed for mass murder. We’ve seen this despicable tactic from liberals many times before, of course – from the recent Times Square bombing attempt, to the Oklahoma City bombing, to the assassination of President Kennedy.

This recent disgraceful behavior offers yet another clear look into the disturbed and hateful souls of so many in the intellectual vanguard of modern liberalism. Seeing their hoped-for apotheosis of liberalism, the Obama presidency, flounder and seeing most voters in the recent elections reject the liberal agenda, liberal opinion leaders are angry, desperate, and unhinged. And they are not troubled to accuse conservatives of being moral accomplices to mass murder, for facts and truth don’t matter to the socialist, collectivist cause – only that “truth” that advances their social deconstruction of an America predicated on individual liberty, personal accountability, limited government, and constitutionalism.

I’ve collected some noteworthy responses to the deranged liberal smears that can serve me as continual reminders of the true purpose and character of modern American so-called liberalism, the antithesis of what the term meant years ago and should always have stood for.

Glenn Harlan Reynolds in the Wall Street Journal (link): ‘To be clear, if you're using this event to criticize the "rhetoric" of Mrs. Palin or others with whom you disagree, then you're either: (a) asserting a connection between the "rhetoric" and the shooting, which based on evidence to date would be what we call a vicious lie; or (b) you're not, in which case you're just seizing on a tragedy to try to score unrelated political points, which is contemptible. Which is it? … I understand the desperation that Democrats must feel after taking a historic beating in the midterm elections and seeing the popularity of ObamaCare plummet while voters flee the party in droves. But those who purport to care about the health of our political community demonstrate precious little actual concern for America's political well-being when they seize on any pretext, however flimsy, to call their political opponents accomplices to murder.”

Jay Nordlinger at National Review Online (link): ‘After the Kennedy assassination, John Tower and his family had to evacuate to a safe place. The early word was that right-wingers had killed the president. Tower was associated with Goldwater for President. There were death threats against his family. It transpired, of course, that a left-wing nutjob who had “defected,” briefly, to the Soviet Union was the killer. A liberal was quoted as saying, “Now our grief can be pure.” …. If an Islamist blows up or guns down 50 people, shouting “Allahu Akbar” as he does it, you’re not supposed to say that the act has any broad implications at all. It is simply an individual act, end of story. But if a young psychotic in Arizona kills a lot of people, we’re supposed to examine the state of Sarah Palin’s soul.’

Andrew Klavan at City Journal (link): ‘… [T]he Left’s sudden talk about incendiary political rhetoric in the wake of the Arizona shooting isn’t really about political rhetoric at all. It’s about the real-world failure of leftist policies everywhere— … leftists [are] starting to lose control of the one weapon in which they have the most faith: the narrative. The narrative is what leftists believe in instead of the truth. If they can blame George W. Bush for the economic crisis, if they can make Sarah Palin out to be an idiot, if they can call the Tea Party racist until you think it must be true, they might yet retain power in spite of the international disgrace of their ideas. .… call it Narrative Hysteria: a frantic attempt to capitalize on calamity by casting their opponents, not merely as racist or sexist or Islamophobic this time, but as somehow responsible for an act of madness and evil. Shame on them.

Roger Kimball at National Review Online (link): ‘What we have here in the tortured left-wing effort to enlist the ghastly Arizona shootings into their anti–Tea Party campaign is yet another example of political correctness on the march. The great irony … is that all this vitriol should be marching under a banner called “liberalism.” There is nothing liberal, nothing having to do with freedom, about it. It is all about control: power in the hands of a nomenklatura and submission visited upon you and me, my friends. It’s the good old strategy of Lenin, dusted off and infused with some new names.’

George F. Will at the Washington Post (link): ‘Let us hope that … [this] is the last gasp of the generation of liberals whose default position in any argument is to indict opponents as racists. This McCarthyism of the left - devoid of intellectual content, unsupported by data - is a mental tic, not an idea but a tactic for avoiding engagement with ideas. It expresses limitless contempt for the American people, who have reciprocated by reducing liberalism to its current characteristics of electoral weakness and bad sociology.’

Andy McCarthy at National Review Online (link): ‘Very simply: The Left likes Islam and sympathizes with the Islamist critique of America, while it seethes with contempt for the likes of Sarah Palin, Rush Limbaugh, and any person or institution that can serve as a symbol of conservatism or bourgeois American life. Consequently, any heinous act that can be contorted, however counterfactually, into a condemnation of the Right will be exploited for that purpose. Conversely, there is to be quick rationalization for, and then studious suppression of, any shameful episode that is too clearly traceable to a leftist cause célèbre — Islam, a movie pining for George W. Bush’s assassination, ghoulish wishes that Clarence Thomas or Dick Cheney will meet swift and painful deaths, or Senate Democrats’ comparing U.S. troops to Nazis, Soviets, Pol Pot, or terrorists…. There is no point debating any of this. Two years ago, we were still being told dissent was the highest form of patriotism; now it’s the root cause of murderous rampage. Modern leftists are tacticians. They’ve convinced themselves of the rightness of their cause, obviating the need to be consistent or faithful to facts in any single episode. For them, it’s all about how the episode can be spun to help the cause. That’s worth understanding, but not debating.’

Peter Wehner at Commentary Magazine (link): ‘What is on display is a cast of mind in which facts and reality are secondary to storylines and narratives. The aim is not truth; it is to advance The Cause. It is also about cynical exploitation. As one veteran Democratic operative told Politico, the Obama White House needs to “deftly pin this on the tea partiers” just as “the Clinton White House deftly pinned the Oklahoma City bombing on the militia and anti-government people” in 1995…. It is all quite sick, really. Not a few liberals are attempting to use a human tragedy to advance an ideological agenda. They are using dead and broken bodies as political pawns. The blood was still flowing from the gunshot wounds of slain and wounded people in Tucson as liberals began an extraordinary and instantaneous smear campaign. It will end up making our political discourse even more angry and toxic. I was naïve enough to be surprised at what has unfolded in the last 48 hours. The cynicism and intellectual corruption on the left is deeper than I imagined.

Charles Krauthammer in the Washington Post (link): ‘Rarely in American political discourse has there been a charge so reckless, so scurrilous and so unsupported by evidence.’

Daniel Henninger in the Wall street Journal (link): ‘What happened in November [the widespread electoral repudiation of liberal policies] has to be stopped, by whatever means become available. Available this week was a chance to make some independents wonder if the tea parties, Sarah Palin, Rush Limbaugh, Glenn Beck and Jared Loughner [the Tucson mass murderer] are all part of the same dark force. Who believes this? They do. The divide between this strain of the American left and its conservative opponents is about more than politics and policy. It goes back a long way, it is deep, and it will never be bridged. It is cultural, and it explains more than anything the "intensity" that exists now between these two competing camps. The Rosetta Stone that explains this tribal divide is Columbia historian Richard Hofstadter's classic 1964 essay, "The Paranoid Style in American Politics." After Hofstadter, the American right wasn't just wrong on policy. Its people were psychologically dangerous and undeserving of holding authority for any public purpose.’

Peter Wehner, again, at Commentary Magazine (link): ‘The left has decided to build on the slander that conservatives were moral accessories to murder. This week they are using the death of six innocent people in Arizona as a means to advance their policy agenda — even though that policy agenda had nothing on earth to do with the terrible events in Tucson .… And so the forthcoming health-care debate is now being framed in the context of the Tucson massacre (the not-so-subtle argument is that health care contributed to the “climate of hate” that the left still wants to insist contributed to the violence on that awful day)…. What we’re witnessing among some liberals are minds that are so thoroughly and completely politicized that they will use any human tragedy, create any set of arguments, and invent any narrative they can in order to advance The Cause…. [A]pparently, some on the left are so consumed by politics that it tints every lens they look through; it impacts every act in life; and it colors every living, breathing thought they have.’

John M Greco

Dem Congressman Says Republicans Are Wrong to Focus on Obamcare Rather than Jobs; Where Has He Been, in a Cave?

Robert Andrews, a Democrat Congressman from New Jersey, was a guest on today's Bill O"Reilly show and was introduced as one of the "co-authors" of Obamacare.  He was asked to respond to the announced Republican plan to hold a repeal vote on the law very soon as one of the first activities of the new Congress.  This guy said, and I quote, "I think it's wrong to focus on healthcare rather than jobs."   

This is too rich, too ridiculous.  In fact, this guy had such a flat affect even he couldn't muster enthusiasm for his argument, if one can even call it that.  For two years the Democrats have focused primarily on their health care scheme, to the detriment of job creation, and now this guy says it would be wrong to focus on health care rather than jobs.  He avoids defending the substance of the bill -- he just doesn't want to talk about it.

For the past two years, their health care scheme was the top priority for Democrats instead of jobs, the economy, and Islamic terror, to name just a few other things, and the voters responded with the Great Repudiation of 2010.  Now congresssional Republicans, many of whom were newly elected as much as anything else because of their opposition to Obamacare, want to try to repeal what they think is not only a very bad attempt at health care "reform" but a great harm to the economy and the Constitution as well, and all this guy Andrews can muster is to knock them for not focusing on "jobs".  This is appparently the Democrat approach to defending Obamacare -- change the subject to jobs.  Any problems with anything we've done or haven't done -- why worry about that?  Focus on jobs, jobs, jobs.   

A great impediment to more job creation IS Obamacare.  This Dem tactic is pathetic.  New Jersians and the rest of us deserve much more.

John M Greco