Good as gold?

A 1 oz gold coin issued by the U.S. Mint and decreed by Congress to have a monetary value of $50.00 is the source of an interesting court case in Nevada. Let's assume you have a $50 gold piece and take it to the bank to deposit it. The bank clerk will credit your account for $50 but if you take it down the street to a coin dealer, he will give you about 20-times that amount.

What if you have a construction business and you hire a guy to hang dry wall and pay him in gold coins at a rate of say one gold coin per week and since the worker is an independent contractor as opposed to an employee, you are not required to withhold anything for taxes. Therefore, does the worker owe taxes on $2,600---the face value of his yearly earnings---or something like $50,000? If $2,600, the employee is below the taxable level the government has established for owing income tax. That question is one which should be answered by the IRS when the dry wall guy files his taxes.

Well, as you might imagine, the IRS does not want to worry about individual income tax reports and it is charging the businessman with 57 counts of income tax evasion, tax fraud and criminal conspiracy. If convicted on most counts, he could live out his life in prison. BestView has a problem understanding how the employer is guilty of anything when he uses U.S. coinage as Congress designated it, and if I was on the jury, he would have at least one vote of not guilty.

What if I had a piece of property on the market for $100,000 that I paid $50,000 for and I designated that the buyer close with $2,000 in $50 gold coins---legal tender? Would I have a tax gain on the transaction? One thing I would have is a major problem finding a lawyer to close on the transaction.

Government Motors

It looks like BestView is back from the balmy Bahamas just in time to wallow in the Obama nominee for the Supreme Court and his contrived bankruptcy of GM. Since tomorrow is the day when we all expect GM to enter bankruptcy, this event is one which should be watched closely for an investment opportunity. If you own GM stock now, it will become essentially worthless after the company enters Chapter 11. However, the shell company could well be worth something to some big corporation since it has gobs of losses on the books. Here is the situation:
GM has lost about $69 per share in the last 3 years. That loss is very valuable. It may be a record for any American corporation. Someone will want that corporate shell when all the assets are stripped away. That someone will want it for the loss. For example, Microsoft could buy the GM shell for less than $500 million. The GM tax loss for the last 4 years is almost $32 billion. An analysis by Gerry Sullivan found that based on Microsoft's recent earnings and taxes, the GM tax loss would save MSFT around $9 billion in taxes.
For this reason, GM stock may be worth buying in the near future, but you would have to be out of your mind to buy one of their cars.

BestView off to the Bahamas

We will be taking a little trip with one daughter, her husband, and 2 grandkids to the Bahamas this week. Posting may be sporadic but relaxing should be continuous.

Clinton's Legacy

Just ran across this article mentioning that JFK had a sexual relationship in the White House with a 19 year old intern and she is coming out with a book (naturally) describing the affair. This should make for interesting commentary from the liberal media.

A Gitmo Solution

Scott Ott who publishes on the ScrappleFace web site strikes again. Read it here.

In an effort to shut down the U.S. Naval Detention Center at Guantanamo Bay, Cuba, thereby restoring America's moral standing in the world, President Barack Obama today declared some 240 enemy combatants held at Gitmo to be 'human fetuses'.

In an executive order, the president said, "Since I ordered Gitmo shut down, and people don't want us to bring the inmates here, the only way to extract them from the facility is to change their legal status to one that offers us more choices."

While accused terrorists have access to attorneys, and nearly-limitless legal appeals, a fetus has no legal standing, cannot speak for itself, and is subject to the death penalty without regard to guilt or innocence.

Civil rights advocates have pressured Obama to follow through on campaign promises to shutter Gitmo, but even Democrats in Congress have resisted bringing the inmates to U.S. soil for trials and incarceration.

"We can debate whether enemy combatants have access to protections under the U.S. Constitution," said Obama. "However, no serious person would grant such protection to an embryo or fetus. The loss of 240 fetuses wouldn't raise an eyebrow in a nation where more than 3,000 of them hit the Dumpster daily."

The president noted that America's global reputation has been devastated by U.S. treatment of terror suspects, but that "our treatment of a million fetuses each year earns us nothing but admiration, and requests for clinic-funding from those who aspire to be like us."

Sources acknowledged continuing White House debate about whether a terrorist who escapes from Gitmo alive can still be treated as a fetus.

Real men, real sport

This is a slow time for televised sports here at BestView. When they diluted baseball by putting a major league team in every city without comparable increase in major league quality players, they lost me. Not interested anymore. NBA basketball has evolved into a marathon season with 7 foot players putting the ball into a 10 foot basket---usually after having palmed the ball and taken excessive steps. Not real basketball.
That pretty much leaves me with PGA golf at this time of year, but I ran across a game of Australian rules football while channel surfing the other day and there is a game being played by real men. They dress like soccer players and the game has full contact collisions which are at least as violent as our football. I don't understand the rules, but they score a lot of points some way and the action is compelling.

Microbiology to save the world

Well, maybe that title exaggerates just a bit, but we are seeing some interesting results from a recent meeting of the American Society of Microbiology. As described in one report, my colleagues have found a way to convert biomasses into biofuel that can be used to decrease our dependence on oil. Here is a sample of the report, but the entire abstract can be read here.

Researchers are looking at alternate biomasses as food for microorganisms to ferment into ethanol. The most attractive are known as lignocellulosic biomass and include wood residues (including sawmill and paper mill discards), municipal paper waste, agricultural residues (including sugarcane bagasse), dedicated energy crops (like switchgrass) or the non-edible parts of corn like cobs, stalks or stover. The problem is, unlike corn starch, the sugars necessary for fermentation are trapped inside the lignocellulose part of this plant biomass. The key to ending the food versus fuel debate is unlocking the sugars trapped in cellulosic biomass.

To do that, some scientists have taken a page out of the playbook of the pharmaceutical industry. Pharmaceutical companies routinely use a process known as high throughput screening to rapidly test thousands of compounds for potential new drugs. Martin Keller at Oak Ridge National Laboratory, the DOE bioenergy research center director, and his lab have adapted the method to rapidly test poplar tree samples for their ability to give up sugars.

Cheney's Defense

BestView is amused by the liberal reaction to Dick Cheney's speech yesterday and previous appearances on interview shows. It is obvious that they are not pleased that he is offering a defense of the Bush/Cheney defense policies, but what seems to matter the most to them is the fact that he is speaking out at all in any way. To them, he is supposed to be under a rock and let Obama do and say anything he wants.

Memo Logic

Let's see where we stand on the interrogation memos everyone is talking about. Obama released the ones which set the legal framework upon which three terrorists were convinced to chat to us about future attacks on America. Once this was done, Dick Cheney asked that the other memos which concerned the results of the little CIA talks with our detainees. Cheney says they will reveal that our persuasion techniques were helpful. Obama says he has read them and he finds them "ambiguous". So, even though BO says he is going to have an open administration and the memos in dispute will not support Cheney's claim, he is going to keep them classified. Those of us who are skeptical about all this somehow find it passing strange that Obama would hesitate to prove the former Vice-President wrong in his claim. Logic finds us on the other side of the Messiah's decision on all this and we look for him to cave as he has on so many other things.

Financial Options

BestView does not give investment advice, but if you are concerned about the U.S. debt and budget situation, certain well-established consequences will flow from the Obama administration economic policies. First, the country will need to borrow extensively to fund the budgets projected in the future. The only way they can do that is to print money and sell the bonds to someone. When you increase the supply of something, its value goes down. Ergo, the value of the dollar in the future will go down in my opinion. What can you do about this? One thing you can do is buy an Exchanged Traded Fund (etf), which trades just like any stock, that has the symbol UDN. This is a fund which goes up in value when the dollar loses value. I own this in my IRA.

Another consequence of the massive increase in the amount of dollars which will be available is commodity inflation. When the value of money goes down and more dollars start chasing things we need to support our life styles---like food and energy---the cost of those things will go up. In previous posts BestView has mentioned the virtue of owning some gold. Now there is a way to offset some of the damage that will be inflicted on future budgets in your household by owning a broad basket of commodities which will increase in value when the cost of things like oil, wheat, sugar,etc. get more expensive and thereby make food and transportation more expensive (inflation). Again, this can be done using an exchange traded basket of commodities called an ETN which trades like an ETF or any other stock on the New York Stock Exchange. The symbol is RJI. If you think that in the next few years the cost of groceries and energy is going to go up, an investment in RJI could help offset that increase. I am currently considering such an investment, but haven't bought it yet.

These are not investment recommendations, but we all need to find some way to avoid the consequences of inflation and these are two ways to investigate for your particular situation. Another hedge against inflation is real estate, but that is the subject for another day and compared to the suggestions above suffers from lack of liquidity in that you can't just wake up some morning and sell your real estate like you can a stock.

A shovel ready project now underway

Legality of "Torture"

Victoria Toensing is a legal source with superb credentials to explain the background of the current torture investigation called for by the loony left in this country. Her Op-Ed is required reading if the situation is to be put in proper context with historical support rather than political vendetta against Bush and Cheney. Read it here.

Common Ground?

President Obama delved into the charged abortion debate in a controversial Notre Dame commencement address Sunday, urging civility and a search for common ground on this most divisive issue. As usual, Obama sounds entirely reasonable but he needs to explain how to reach common ground without a dead baby.

If you weren't worried before........

The anchor closed the interview by getting the former vice president’s take on the Obama administration’s performance so far:

ROBERTS: Let me ask you about the new administration. How do you think they’re doing so far?

GORE: I think they’re doing amazingly well. I think that he is moving forward on all fronts in a very intelligent, focused and committed way -- that is exactly what the country needs. There’s room for disagreement on this policy or that policy, but overall, I think that the American people are responding the same way I am. And by the way, I think he’s done a terrific job of reaching out to his opposition.

ROBERTS: Even though he only got three Republicans in the Senate to vote for the stimulus package, and none of them voted for his budget?

GORE: Correct, and I don’t think that's to be laid at his feet. I think that the efforts that he has made and continues to make may well bear fruit later on.

ROBERTS: And are you confident that all of this money, all of these trillions of dollars are being spent wisely?

GORE: Yes. Whenever you have programs of this size, you will always find critics to pick out one or two things and spin them in a negative way. But, by in large, I think they’ve set the right priorities and that they’re doing an excellent job. Yes.

Criminal Acts

If the CIA lied to Congress about its interrogation of terrorists, it is a crime. Even though Nancy Pelosi has been Speaker for 2 years, it is certainly reasonable to look for her to push for a belated criminal prosecution of those responsible. Let the overdue trials begin.

Don't hold your breath.

Is it now the CIA's turn?

It is hard to believe that the CIA--even under Leon Panetta--is going to quietly permit Nancy Pelosi to call it a liar when there are actual documents confirming their congressional briefings and attendance at them. This is going to get good and the country can only gain if some sensible democrat challenges her to save the party from her left wing idiocy.

A History Lesson for Liberals

The leftists who are now in a tizzy because the CIA poured some water on the nose of terrorists in the aftermath of 9/11 need to read this reminder of the nation's response to Pearl Harbor by General Curtis LeMay. Here is an example:

On the night of March 9, 1945, LeMay sent 346 huge B-29 bombers loaded with napalm from the Mariana Islands (Guam, Saipan and Tinian) to Tokyo. The first planes dropped their incendiaries on the front and back of the target area -- like lighting up both ends of a football field at night. The rest of the planes filled in the middle. More than 16 square miles of Japan's capital city were gutted, two million people were left homeless, and 100,000 were dead.

Some of us think our response was too restrained after 9/11 and a more emphatic lesson on the perils of such terror attacks on the U.S. should have been made on all of Islam.

A Walk on the Left Side

Now and then BestView checks in to see what liberals are concerned about on their blogs. Since our entire government is now controlled by Dems the main problem seems to be any voice contrary to their social/big government agenda. First it was Rush Limbaugh and now the boogie man seems to be Dick Cheney who had the temerity to actually give a couple of interviews. Here is an example from the blog Talking Points Memo:

This is a guy who made an entire career as the ultimate evil puppet-master, always behind the scenes and always in control. What strikes me as so out of character is his apparent inability to keep his mouth shut when he no longer has his hands on the strings. While I despise him for what he did to our country's image and his shredding of The Constitution, I have always had a begrudging respect for what I thought was his phenomenal discipline and long term ability to keep the goal (however evil) in front of his public ego. Now I am finding him to be an ever more paranoid, disturbed, and pathetic man and I am truly shocked that those on the inside let him run the show for so long. I would ask how we let this megalomaniac do so much damage, but he wasn't actually a megalomaniac - that requires a delusion of power.

They really don't like Cheney much in loonyville.

Presidential Malfeasance

In the U.S. criminal code, specifically 8 USC 1325, it says illegal aliens "shall, for the first commission of any such offense, be fined under Title 18 or imprisoned not more than six months, or both, and, for a subsequent commission of any such offense, be fined under Title 18, or imprisoned not more than two years, or both."

President Bush did not enforce this law as he swore to do when inaugurated and Obama has not and will not either. Here is a recent comment of Obama's Secretary of Home Land Security.

During a recent interview on CNN's "State of the Union With John King," Homeland Security Secretary Janet Napolitano was asked what she thought about the statement by Sheriff Joe Arpaio of Maricopa County, Ariz., that the feds should prosecute all caught crossing the border illegally. She responded by blaming employers, "the human traffickers who are exploiting human misery," and said that "when we find illegal workers, yes, appropriate action, some of which is criminal, most of that is civil, because crossing the border is not a crime per se. It is civil."

So the federal government ignores the law and turns on Sheriff Arpaio who just wants to enforce that which the government put into law.

BestView has BeachView

We are spending the week at our beach home on Eddingsville Beach in South Carolina. Just returned from a 2 mile walk on our beach with temperature about 80 F, a gentle SW breeze and not another human being in sight the entire time. Just sublime. It is easy to forget about Obama and Pelosi on the beach.

Deficits Matter

The consequences of the Obama budget deficits are already becoming obvious. Liberals who once decried Bush deficits of $300-400 billion are now mostly silent when Obama's are in the trillions, but the bond market will bring all of us down to reality. All the money Obama wants to borrow comes in the form of Treasury Notes which must be put up for auction. The government sells them to bidders and the interest rate on them reflects supply and demand plus the outlook in the future. So, if you are trying to sell a 30 year bond, the buyer will want to set the price at a level which will allow him to make money over that length of time. If the supply is large, the price will be lowered and the interest due on the note will be higher. There was an auction last week and the interest demanded by the buyers of the 30 year notes went from 4.1 to 4.3%. This may not seem like much,but we have only begun to sell these things to finance Obama's budget excesses. When the interest rate on treasury notes goes up, the interest rate on everything goes up. We are in the very early stages of what could be Jimmy Carter squared.

Obama's Budget Cuts

We all remember during the seemingly endless campaign that Obama said if we elected him he would go over the budget line by line and take his pen to strike out unnecessary spending. Well, he has evidently done exactly that. Since most people lose their sense of reality when billions and trillions are used to depict government spending, BestView has found another way to see how mightily Obama's pen was wielded. The headlines this week all said Obama was proposing cuts of $17 billion from his previously announced budget. Here is the math. The budget he put forth called for spending $11,600 for each American and the cuts, which Congress won't accept, come to $55.00. How is that for "Change You Can Believe In?"

Voucher Update

BestView is still steaming at the Obama position on vouchers for black students who are demonstrably benefiting from their escape from the failing D.C. schools. Now, apparently since they are catching some flack from what is an indefensible position, they say students currently in the voucher program can be "grandfathered" and continue, but no new students can be added. This, of course, is tacit admission that the program works but the teachers union can't be challenged.

Meanwhile, other liberals are concerned with the fact that there are 4,777 black males per 100,000 in the nations federal and state prisons and local jails. The number for whites is 727 per 100,000. Blacks are 13% of the general population and 38% of the prison population. What is the liberal solution to this disparity? They want to make the use and distribution of crack cocaine the same as powder even though they know that crack has a greater effect on black communities and locking up crack pushers and users longer has to be a positive. This is evidently a better solution to the problem than giving young blacks a good education. Our prisons are not full of educated men of either race.

Just walking the dog

A not so gay marriage?

Despite promises from Senate Majority Leader Harry Reid (D-Nev.) that Sen. Arlen Specter (Pa.) would retain his seniority after switching parties, Specter will be put at the end of the seniority line on all his committees but one under a resolution approved on the floor late Tuesday.

Under the modified organizing resolution, Specter will not keep his committee seniority on any of the five committees that he serves on and will be the junior Democrat on all but one — the chamber’s Special Committee on Aging. On that committee, he will be next to last in seniority.

Story here

Obama's Biggest Disgrace?

The Wall Street Journal has two excellent editorials today describing the shameful, hypocritical decision of Obama to discontinue the voucher program available to a few Washington, D.C. students (99% black and Hispanic). Read them here and here. An partial description of this shameful situation is given below. Well worth reading.

The Education Department released its annual evaluation of the D.C. program last month -- tellingly, without a press release or media briefing -- and it showed that voucher recipients are reading nearly a half-grade ahead of their peers who didn't receive a scholarship. These academic benefits are compounding over time. The study revealed that the program's earliest participants are 19 months ahead of public school peers in reading after three years. Nationwide, black 12th graders as a group score lower on reading tests than white 8th graders. The D.C. voucher program is closing this achievement gap.

See if you can follow this political syllogism. President Obama and his Education Secretary have repeatedly promised to support "what works," regardless of ideology. The teachers unions adamantly oppose school vouchers, whether or not they work. Ergo, Messrs. Obama and Duncan decide to end a D.C. school voucher program that works and force poor kids back into schools where Messrs. Obama and Duncan would never send their own children. What a disgrace.

Attack on Tax Cheats

It was really fun to watch Obama make a serious announcement yesterday that he was going to ask Congress to crack down on tax cheats with a somber Sec. Geithner looking on as a human prop behind him. There was room back there for Tom Daschle, Rep. Rangle, and others, but Geithner must have drawn the short straw.

Liberal Economics at the New York Times

As has been pointed out in BestView and elsewhere newspapers are going the way of the buggy whip. The New York Times is threatening to close the Boston Globe if the unions don't give back major portions of previous agreements and is losing money daily. Now, the word is this dishonest liberal rag has decided that it can bring in more money by raising its price. So, both the weekly and Sunday additions will cost more. If you think it is smart to raise the price of something you can get free online, this is a winning idea. Otherwise, it is akin to the liberal thinking which believes raising taxes is a good way to increase revenues.

Phony Alert

WASHINGTON (AP) - One day after saying he wouldn't travel in tight quarters because of the swine flu scare, Vice President Joe Biden rode a train Friday from Washington to Delaware.

Known for speaking freely, Biden told NBC's "Today" show on Thursday that he had urged family members to avoid airplanes and subways for fear of contracting the H1N1 flu virus.

"I wouldn't go anywhere in confined places now," Biden said.

The comments infuriated the travel industry and triggered several revisions from the Obama administration, whose official advice is less severe.

Homeland Security Secretary Janet Napolitano commented, "If he could say that over again, he would say if they're feeling sick, they should stay off of public transit or confined spaces."

By Friday night, Biden seemed ready for his own do-over. A longtime rider of Amtrak, he took a train from Union Station to his Delaware home, his office said.

Change the Words

In a recent BestView entry below,The Truth Commission, it is pointed out that when liberals and others in the government name something, it is often done in such a way as to disguise its true nature. The New York Times this morning has a great story which makes this point and several others commonly raised in this blog. Here are two paragraphs of the story which makes it clear that the entire climate change, global warming subject is manufactured claptrap.

The term global warming turns people off, fostering images of shaggy-haired liberals, economic sacrifice and complex scientific disputes, according to extensive polling and focus group sessions conducted by ecoAmerica, a nonprofit environmental marketing and messaging firm in Washington.

Instead of grim warnings about global warming, the firm advises, talk about “our deteriorating atmosphere.” Drop discussions of carbon dioxide and bring up “moving away from the dirty fuels of the past.” Don’t confuse people with cap and trade; use terms like “cap and cash back” or “pollution reduction refund.”

Joe Biden, M.D.

Obama is going to bankrupt the country, but fortunately he brought along Joe Biden for comic relief while we go under. With the economy teetering, unemployment still rising, and a recovery still in doubt despite massive spending, our Vice President demonstrates his vast medical training by advising that his wealthy family is not taking planes or subways. Meanwhile, those working in places like NYC with no reported cases of H1N1 influenza, who have no other way to get to work except the subway, are left as confused as they were when Obama sent his 747 flying over Ground Zero last Monday. During the campaign, the liberals warned us that if we voted for McCain we would get a moron for Vice-President. Turns out, they were right.