THE CON MAN

You might note that on February 27th, presidential candidate Donald Trump, during a speech in Bentonville, Arkansas, announced to the world: “The last thing I am is a con man.”

I recall my involvement some years ago attending the Trump organization’s 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.

Mr. Trump is accurate when he proclaims that the last thing he is, is a con man.  It’s also true, of course, that the first thing he is, is a con man . . . as well as all the other things in between.  There can be no doubt, however, that, if nothing else, Donald Trump is a master of marketing.  The term marketing is best be described by another quotation from a 2007 Dilbert cartoon, in which the boss instructs his employees: “We can’t compete on price.  We also can’t compete on quality, features or service.  That leaves fraud, which I’d like you to call marketing.”

I don’t deny Mr. Trump has numerous abilities.  He’s rich; he’s confident; he’s most certainly forceful.  Perhaps these traits are sufficient to qualify him to become 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

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LOOTING THE PUBLIC CORPORATION

The topic pops up periodically.  As one observer recently phrased it: “Exorbitant pay of top corporate officers is unfair to America.”  Prominent journalist Margo Roosevelt just provided some excellent examples.  Disney CEO Robert Iger was paid $46 million in 2014; Leslie Moonves, CBS Corp. CEO received $57 million; Discovery Communications CEO David Zaslav netted $157 million in 2015.  Marissa Mayer, Yahoo CEO, $42 million.  The list goes on.

So what should be done to invoke fairness into the compensation of corporate executives?  Perhaps a more appropriate question would be: Why should something be done at all?  Who, exactly, are the losers in what is nothing more than an established charade by which vested insiders systematically skim the assets of public corporations?  Most certainly, neither the general public nor governmental agencies are directly affected. The only losers are those who choose to invest in the affected companies, for it’s from the pockets of those stockholders that the unconscionable sums flow.  And inasmuch as owning shares in a company is essentially voluntary, the victims are free to escape whenever they choose.

What’s behind the move to chop executive remuneration?  It’s the usual motive: The realization that certain persons, who may be presumed to be undeserving, have levered themselves into favored positions from which they receive far more income than the rest of us.  In short, pure envy.

Let me share my bias with you.  I believe that all upper tier corporate executives, regardless of the titles they hold, the positions they occupy or the nature of the firms in which they’re employed, are fully interchangeable.  With few exceptions, their foremost expertise is in not rocking the boat.  To a man—as well as to a woman—they adhere to the dictum that to get along, they must go along.  Accordingly, their concept of a successful company is one which continues to function profitably enough so they may distribute handsome favors to themselves into perpetuity.

This then gets us to the essence of the public corporation.   I contend that the principal reason they exist is so their officers and directors can extract benefits from them.

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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 SUPREME COURT IN FLUX

With the recent death of U.S. Supreme Court Justice Antonin Scalia, the presidential campaign under way has descended into chaos.  What had been regarded as a five-to-four court is no more.  With President Obama’s statement that he will soon submit his choice for a successor—requiring Senate confirmation—Republican Senate leaders are in a state of bewilderment as to how to handle such a nomination.

The Court is now inexorably split along partisan lines.  Justices Ginsburg, Sotomayor, Breyer and Kagan may be expected to consistently cast their votes favoring Democratic policies, whereas Justices Roberts, Thomas, and Alito invariably side with the Republican points of view—often leaving moderately conservative Justice Kennedy as the swing vote.  All controversial political decisions will likely split on a four-to-four vote, meaning no effective Supreme Court action on anything controversial.  And of course, this is the way judicial decisions are traditionally determined.  In analyzing the legality of any contentious matter, biases are dredged up and past experiences revisited, as each jurist ruminates on what he or she personally favors.  This is how precedents are established and the U.S. Constitution interpreted.  Whatever our Founding Fathers had envisaged as fundamental principles of sound government has been long buried in the ash heap of the past.

 

My advice to Republican leaders: Review the record of whomever the President nominates to replace Justice Scalia and, unless the choice is thoroughly objectionable, approve confirmation.  The alternative may be far worse, for in the event the Republican Party selects—as is quite possible—a buffoon as its presidential nominee, it could result in the election of both a president as well as the senate majority from the Democratic Party.  In this case, all judicial appointments for at least the next four years will be of persons whose attitudes conform to those which Republicans generally oppose.

Lest any of you think otherwise, I don’t consider our country or its laws to be in any way inferior to those found elsewhere.  Injustices that occur in our established hierarchy and which strain the social fabric are merely the end product of a society of flawed humans.  Despite our imperfections, we’ve developed a remarkable nation and a set of laws and procedures which are the envy of the world.  That we haven’t achieved perfection can’t be blamed on anyone in particular.

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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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BORROW YOUR WAY TO PROSPERITY

The economic report just presented is declared to be favorable: “U.S. consumers in December increased their borrowing at the fastest pace in three months.  Borrowing expanded $21.3 billion in December, the strongest showing since an increase of $28.6 billion in September, the Federal Reserve reported.  That pushed total borrowing to a fresh record of $3.55 trillion.”  This forced me to do a double take; did I read it wrong, or did it actually say what it appeared to say?

A bit of research reveals, in fact, that it’s heavy borrowing by Americans which fuels our prosperity.  The Fed says U.S. consumer borrowing is good news for the American economy.  Economists contend this activity boosts growth in a country where consumer spending accounts for nearly 70 percent of economic activity.  So, though it may seem strange, we should all cheer when we learn “IOUs held by U.S. households rose to $11.3 trillion in the third quarter” and that “student-loan debt continues to pile up as tuition and other higher-education costs become increasingly out of reach for many families.”

As my years of schooling never included an economics course, this is possibly why I cannot find comfort in the knowledge that many of our citizens are head over heels in debt.  It seems counterintuitive that what is clearly bad for each individual American becomes collectively good for all Americans.  However, as they say, you can’t fight city hall, so I’ll not argue with the economic establishment.  But keep in mind the definition of an economist: One who philosophizes about other people’s money.

With the monetary experts now out of the scene, I’ll interject a few suggestions to real people.  Irrespective of any official proclamations to the contrary, personal debt is a pernicious hazard.  Although a sensibly arranged home mortgage loan is often a welcome necessity, the inability of many persons to avoid unmanageable obligations leads to troubles which never end.  The reality of loan default and family breakup, all stemming from a ready availability of credit and an eagerness of lenders to foist off unconscionable loans on an unsophisticated public, is a national tragedy.

I’ll conclude with a final thought: Conduct your life on the premise that all debt is bad.  Avoid it whenever you’re able.  Shun persons who advocate borrowing.

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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 MAKING OF A COMBATANT

I see that Marine Corps Commandant General Robert B. Neller just endorsed the concept which fully integrates women into all combat positions.  Although his predecessor, General Joseph Dunford, had recommended women be excluded from front-line combat roles, General Neller joined with the other military chiefs in rubber-stamping the Obama administration’s full integration policy.  Note, however, the military leaders vowed they will not lower standards to bring women into the more grueling jobs.

The induction of women into the armed forces dates back three-quarters of a century.  It began during World War II, with the creation in 1942 of the Women’s Army Auxiliary Corps (WAACS)—later becoming the Women’s Army Corps (WAC)—and a similar navy affiliate (WAVES).  Though separate from the army and navy at the start, their functions slowly began to merge following the end of the war in 1945.  The WAC was disbanded in 1978, and all units were integrated with male units.

As to recent history of women in the military, the die was cast when in 1975 President Gerald Ford, in fixating his eye toward the women’s vote in the upcoming 1976 presidential election, signed Public Law 94-106, which opened the U.S. Military Academies to women.  It was, of course, vowed by all that standards would be maintained.  You may reflect on how that assurance was honored with a glimpse at physical standards.  Prior to integration the minimum acceptable height was 5’ 6” for a midshipman at the all-male Naval Academy.  If you’ll check the requirements today, you’ll find that 4’ 10” now fills the bill.  Just coincidence, perhaps?

It’s my belief the armed services exist to protect the nation from its worldwide enemies.  Whether or not women are assigned to combat roles should be based upon the likelihood they further the combat effectiveness of the units to which they’re assigned.  It appears, however, that these decisions have become politicized to the point that enhancement of combat capability is not a consideration.

America is no longer a nation that regularly engages in activities which further its best interests.  You may place the blame on our elected leaders, except that it’s we, the people, who elect them to their offices and retain them there as they abuse our trust.  The moral: And so it only goes to serve, that people get what they deserve.

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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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