RESIST THE SALE PITCH

Since the 1920s, when marketing developed into an art, the American public has been deluged with a cascade of ingeniously foisted merchandise.  Examples are endless.  If you’ve recently tuned into the radio talk shows, you’ll learn that the advertisers currently promoting My Pillow, are touting it as a superb product which will ensure the soundest and most comfortable sleep possible.  They don’t mention it sells for $58; you should note that a competitor, Wamsutta, sells a remarkably fine pillow for $19.  This is the way the world of advertising operates.

Ingenious marketing is now a part of the presidential nomination process.  One of the Republican candidates—Donald Trump—is, if nothing else, a master of marketing.  I recall my involvement several years ago attending his 3-hour seminar, billed as a unique perspective into the art of investment.  To my dismay, the entire period was devoted both to extolling the wealth and personal virtues of Mr. Trump, as well as peddling a several-thousand-dollar follow-up seminar.  It was the hardest sell I’d ever experienced and induced many naive attendees at the event to sign up.

Apparently deviousness in marketing goes hand in hand with general unreliability.  It’s certainly evident in Mr. Trump’s case.  You should be aware that on 9/3/15 he signed a loyalty pledge to the Republican Party that he would support the Republican nominee in the 2016 general election, thereby ruling out a possible third-party or independent run.  At an event at Trump Tower in New York, surrounded by backers, he vowed: “I will be totally pledging my allegiance to the Republican Party and the conservative principles for which it stands.”  Nonetheless, this didn’t dissuade him from announcing on 11/21/15, at a rally in Birmingham, Alabama, that he would be open to running for president as an independent if he concludes Republicans aren’t treating him “fairly.”  You may interpret this as you choose.

I don’t deny Mr. Trump has certain abilities.  He’s rich; he’s confident; he’s most certainly forceful.  Perhaps these traits are sufficient, so that forthrightness and dependability become unimportant qualities in the President of the United States.  If so, then I have the perfect slogan for his campaign: “Put your confidence in a man who knows what the word confidence means.  Donald Trump . . . a real confidence man.”

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If you enjoy this weekly Straight Talk by Al Jacobs, you’re invited to check out my monthly Financial Newsletter, as well as my new book, The Road to Prosperity

Click onto http://www.onthemoneytrail.net/

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THE DEATH PENALTY REVISITED

The legal establishment is once again split over the death penalty.  On 11/12/15 the 9th U.S. Circuit Court of Appeals ruled that, while the 1995 death sentence of convicted murderer Ernest Dewayne Jones cannot be challenged, neither, on a variety of convoluted procedural grounds, can it be dismissed.  This ruling guarantees Jones’ appeals will probably continue until his death of old age.  And so, with proponents and opponents of the death penalty continuing to fight it out, I have a few questions.

Is it unreasonable to execute a sadistic murderer who has proven to be a perpetual threat to the public?  Apparently it is.  The delaying tactics by advocates for death row inmates have so delayed executions that it’s now claimed these very delays cause executions to have become unreasonably infrequent, thereby in violation of the Eighth Amendment’s prohibition of cruel and unusual punishment.

How is society benefitted by providing lifetime room and board—at $47,000 per year per inmate in California—to prisoners who must never be released?  If nothing else, it certainly provides employment for a lot of people.  The list includes prison officials and guards, attorneys to handle the continual death penalty appeals, physicians and medical staff, food service providers to feed the confinees, psychiatrists and psychologists to ensure mental oversight for those permanently incarcerated, for those who operate non-profit foundations which continuously lobby for and against capital punishment, as well as innumerable hangers-on, who merely feed off the uncertainty.

And finally, is our nation more humane when it locks up a person for life?  It can be argued that confining a prisoner to a cell, allowing only minimal contact with other humans and offering no respite to a life behind bars, is far more diabolical than a quick and relatively painless death.  I’m not certain which I would find more onerous.

A final thought: The death penalty must either stay or go; it cannot continue to hang in limbo.  If it stays, its execution must mimic that of 19th century Judge Isaac Parker, the “Hanging Judge,” who, when he declared that the accused  “be hanged by the neck until dead,” was, in fact, promptly hanged by the neck until dead.  However, if society is no longer capable of such forcefulness, then capital punishment should end.  It’s better we base our policies on reality rather than contrived illusion.

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If you enjoy this weekly Straight Talk by Al Jacobs, you’re invited to check out my monthly Financial Newsletter, as well as my new book, The Road to Prosperity

Click onto http://www.onthemoneytrail.net/

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THE MONTHLY PRIME RATE RITUAL

During an appearance before the House Financial Services Committee on 11/4/15, Federal Reserve Chairwoman Janet Yellen commented as follows on the possibility of an interest rate hike:

"What the committee has been expecting is that the economy will continue to grow at a pace that is sufficient to generate further improvements in the labor market and to return inflation to our 2 percent target over the medium term.  If the incoming information supports that expectation, then our statement indicates that December would be a live possibility."

If, in fact, an increase is in the offing, in which a key rate will be raised from its record low of near zero, it will be the Fed’s first rate hike in nearly a decade.

Despite Ms. Yellen’s assurances, our economy is not vibrant, nor is the nation experiencing “improvements in the labor market.”  Jobs are disappearing, with an actual unemployment rate now exceeding 20%.  Traditional sources of income for many Americans no longer exist.  Interest on savings is gone; stock dividends are meager; pensions are becoming a thing of the past.  Many citizens are struggling to exist.

As for the federal funds rate, it’s the U.S. national debt, now approaching $18 trillion, which is the elephant in the room.  If that rate is significantly increased, Uncle Sam finds himself awash in payments which he cannot service without incurring further debt.  This potential vicious cycle explains why the rate has remained where it is.

At some point political considerations become the dominate factor.  If the administration must validate the economy’s health, expect a token increase of perhaps ¼%, followed by media ballyhoo as though a cataclysm shook the earth to its core.  For a brief interval market indices will vibrate violently, amidst irrational prognostications from countless authorities and experts.  Thereafter we’ll return to business as usual.

This is the sort of nonsense in which both the government and the investment world are based.  It’s summarized in Shakespeare’s Macbeth: “. . . a tale, told by an idiot, full of sound and fury, signifying nothing.”

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If you enjoy this weekly Straight Talk by Al Jacobs, you’re invited to check out my monthly Financial Newsletter, as well as my new book, The Road to Prosperity

Click onto http://www.onthemoneytrail.net/