The Half Baked Lunatic

Here’s an old high school physics puzzle, let’s see if you can get the right answer: You have perfectly insulated room (i.e., no heat can escape).  Inside the room is a refrigerator, plugged in and running – but the refrigerator door is left wide open. As the refrigerator runs, does the room: A – get colder B – get warmer C – stay the same temperature Think about it for a minute ... (and yes, I first heard this from my high school science teacher back in the late 70’s) The answer is ... (drum roll please!) ... More...

The star studded 1983 movie "The Big Chill” was about a weekend reunion of a bunch of old college friends – now in their early 30’s – who all get together for the funeral of Alex, one of their classmates who committed suicide. The movie is poignant, intelligent, very funny, and somewhat disturbing all the same time. It’s about rekindling old friendships, coping with the shock of their friend Alex’s death, and wondering what happened to the social idealism that they all shared when they attended the University of Michigan in the late 60’s. They were all anti-establishment, idealistic, smart, enthusiastic, with a vocal desire to change the world and make it a better place. Alex, now deceased, was a charismatic science major. Everyone thought he was the most intelligent one of the bunch – and their mutual friendship really survived through the years because of him. He was the glue that kept them all together, but he was never able to get his own life straightened out. Now, in 1983, they realize they are becoming the conservative “establishment” that they protested against in college.  More...

  A good friend of mine forwarded the following email to me the other day.  Now, before I begin, this friend is one of the smartest people I know.  He is the CEO of a rapidly growing company, introducing successful new products into the marketplace even in this economy. He is a vocal Republican, so all I ever heard from him for about 20 years was that “it’s the Democrats fault” when referring to ANY problems in the world.  I’m neither democrat nor republican, so it's never bothered me any. But then, halfway through the second term of the Bush administration, he swung around and admitted that maybe it’s not ALL the Democrats fault, the Republicans need to take some part of the blame for the state of the world’s affairs. And horror of horrors, he hesitantly (accidentally?) said some positive remarks towards Obama during the election (but really, I think it was more of an anti-McCain sentiment than anything, in one email he said “clearly McCain is an even worse war monger than Bush, very scary.  I bet he never met a weapon he didn't buy.”) However, he’s back to his lovable More...

  Following the hugely successful launch of AloeBoost and AloeRest, I am happy to announce that USAloe is now shipping their third product, AloeControl. AloeControl™ is your unfair advantage in the struggle to maintain a healthy weight. In each healthy 2oz serving you'll enjoy a unique blend of the world's finest fruits, vegetables, and natural ingredients designed to help you control your appetite, efficiently burn calories, and provide you with the essential vitamins and minerals that are MISSING in today's typical American diet. The four core components of AloeControl™ include Appetite Control, Metabolic Enhancers, Digestive Aids, and Core Nutrition. Get all the details and the ingredient list at: http://shop.usaloe.com/products-aloecontrol.aspx I don’t mean to brag, but More...

You normally don’t think of Kenya as being at the forefront of technical and financial innovation – but I was struck by this story I saw recently on CNN: http://edition.cnn.com/video/#/video/world/2009/04/15/mckenzie.kenya.mobile.money.cnn What started out as a way to transfer pre-paid cell phone credits to family and friends has turned into an entire micro-transaction commerce platform that is replacing banks in Kenya. And there’s no reason why it wouldn’t work elsewhere! Think of it as PayPal for cell phones.  For example – you want to buy a magazine from a vendor on the street, but you don’t have change.  The vendor doesn’t take credit or debit cards. So you just enter their cell phone number, specify how much you want to transfer, tap in your security code, and hit send.  Just like sending a text message, but you’re sending cash.  The vendor’s phone beeps, notifying them More...

Like everyone else, I’m completely outraged by the whole AIG bonus issue. Bonuses should reward exceptional performance and positive results.  Where’s the accountability? This has been hashed to death in the press, so I’m not going to go into all the reasons why it’s just rotten to the core. But let’s back up a little bit and see how this fits in with the bigger picture of executive compensation.  This has been an issue for many years, well before the economic downturn. It’s a big thorn in the side of many shareholders of large companies. Executive compensation needs to be tied not only to performance, but also to their own personal risk.  For example – a hired CEO brought in to More...

There is absolutely NO WAY that any kind of a mortgage bailout will be fair.  The people who would benefit from mortgage assistance are generally the ones least likely to deserve it. Hardest hit are people who either bought a bigger house than they could really afford, and people who snagged one of those great “no money down” loans.  Are YOU willing to subsidize someone who is living in a luxurious home they shouldn’t have been able to afford in the first place?  Is that the kind of behavior that we are trying to encourage? Absolutely not! While I do have great sympathy for someone who is losing their home after 20 or 30 years, let’s look at the reality of who this might be: Assume someone bought a house More...

USAloe, a company in California that I've been doing some consulting work for, is launching two new products this week:  AloeBoost (an energy drink) and AloeRest (a relaxation and sleep aid). Both are made with Aloe Vera juice and other healthy, all natural ingredients. What's interesting is that these products are going into a network marketing channel instead of a traditional retail channel, and I think people are going to make pretty good money from it. Now, over the years, I've had plenty of people pitch me on different network marketing companies. All of them have said pretty much the same thing: "I'm going to be retired in two years!"  I've checked back with a few of them, and none of them had the financial success that I've had. The truth is, a lot of people HAVE made a very substantial income with network marketing (or multi-level marketing, or whatever you want to call it) but these people are More...

When people think about trading options, their first response is usually "too much risk". While it's true that options can be misused, they are often used to REDUCE risk by hedging other investments.  For example, buying a stock and selling a "covered call" is a substantially more conservative investment than just investing in the stock itself (less risk, but also potentially lower return). And yes, I have learned the hard way what can happen if you lose your head.  After about ten years of successfully and profitably trading options, I entered into an overly aggressive position in 2006 that went south - and pretty much wiped out my entire gains of the previous ten years.  Lesson learned: stick to your strategy and stay within your limits! But in general, even with that painful experience, I am still a firm believer that trading options is more prudent than buying stocks. Admittedly, options are far more complicated.  More...

  I've been doing a little research on historic real estate price trends.  I don't think that many people realize how much appreciation we really had in home prices from 1998 to 2006 - it was an amazing run! Even with the bottom dropping out of the market, we're still above the 30 year "average trend line":   But as history has shown, real estate prices are cyclical.  Just like the tech stock crash in 2001, the faster the run-up in prices, the further things fall.  Most people who've owned their homes for More...