HAWAII LEADERS KICK THE CAN DOWN THE ROAD... AGAIN
After observing our elected officials this past session, one can confirm that people should stop being taxpayers in Hawaii. A good example of "kicking the can down the road" for future government officials to solve.
http://malamakupuna.blogspot.com/2011/03/stop-being-hwaii-taxpayer.html
At any social gathering, you're sure to find someone who is receiving a State or County Retirement System pension and obtaining free Part B medical reimbursement as well as Part D benefits. Ask them what they think the solution to the state's insolvency problem is. In my experience, every one of those who were asked the question went into a tirade about how they were underpaid and took government jobs because these benefits were a part of the package promised.
When asked how, since the pension fund and the medical fund are both bankrupt, do they think the government will come up with the money, the reply is always to tax the rich and the businesses. Therefore, if your replies are the same as mine, then they plan to go after your money if you invest it here in Hawaii. They will further get your money if you remain a Hawaii taxpayer.
Hawaii's excise tax is unique in that it taxes an investor's or business' cash flow. It is not a tax on profits. So if you lose money in your investment or business, but have cash flow, you still must pay this tax. If you have rental property in Hawaii, then you must pay excise taxes on the gross rental income.
We have examined the different types of investments that people would consider and if real estate is your choice because you want to hedge against inflation, then you ought to invest in property outside of Hawaii because the excise tax will drive your investment into insolvency. Better yet, you may want to buy into a Real Estate Investment Trust, which is a mutual fund that invests in real estate. The fund itself pays excise taxes if they're dumb enough to invest in Hawaii property, but in general, you would be free of the excise tax.
If you owned the out-of-state rental properties directly and lived in Hawaii, the Hawaii tax collectors will still go after you for this excise tax. They get you if the property is located in Hawaii and if it's not, they will tax you on the cash flow if you're a Hawaii taxpayer.
The U.S. is in the second phase of printing vast amounts of currency. It's called QE2. For those of you who went to private school, the following link explains everything.
http://www.youtube.com/watch?v=PTUY16CkS-k&feature=player_embedded
http://malamakupuna.blogspot.com/2011/04/high-energy-costs-hurt-our-kupunas.html
If you believe that your currency will go down in value, then you could invest in energy mutual funds. Or, perhaps into International Funds that invest in companies operating in foreign countries. When doing so, you're investing in both the profitability of the company and the movement of the U.S. currency.
Kupunas need to be more conservative because they're past their productive life. Most invest their funds in investment grade 10 year bonds. When interest rates go down, bond prices go up. Similarly, when interest rates go up, bond prices come down. If inflation looms, then the government has to raise interest rates to stifle inflation. Well, inflation is here, but the government has chosen to redefined what is taken into account when they calculate the inflation rate. Thus, they've determined that we have no inflation even though food, housing and consumer prices keep going up and they're able to do it by simply redefining what inflation is. Their reason is that if interest rates go up, they too, must pay higher interests to those who bought government bonds. On $14 trillion of debt, the interest costs will exceed the operating cost of the government.
For the short term, those who own intermediate term bond funds can cover themselves by buying more shares with each monthly interest payment when bond prices go down. When bond prices rise, they'll buy fewer shares, but, they can sell the shares at a higher price.
Each summer, stock prices generally go down until after Labor Day. Most investors take the summer off. It's generally a good opportunity to reallocate one's portfolio at this time because if one plans to buy more stocks, you'll do so when prices are low.
Too complicated? O.K. For those who went to Punahou or Iolani, here's a simple way to lower your risks and increase your returns. If you have a mortgage where the interest rate is at 5% and you have a bank account where they pay you 1/4 of 1%, you would increase your returns by 2000% by paying down your mortgage. So if you put $500 a month into your bank account, use that money to pay an extra $500 towards your mortgage instead, and you'll be saving the 5% interest on that $500.
I've had lots of people upset with me for recommending that investors take their investments out of Hawaii. Words like "traitor" are used frequently when I go further and suggest that investors think about investments in foreign companies.
We all agree, though, that taking investment money out of Hawaii will further spiral the State into insolvency. But if investing in Hawaii is a losing proposition, then unless your goal is to lose your investment capital, then you'd better invest elsewhere.
We cannot control what our government does. We know that they are not truthful. What we can control is how we react to them and their policies.
My money loves Hawaii and this country. Hawaii and the country doesn't love my money.
Uh, oh! I stole that somewhere.
Tuesday, June 7, 2011
Tuesday, May 24, 2011
OUR PRECIOUS VETERANS
OUR PRECIOUS VETERANS
I performed at the Center for the Aging on the grounds of Tripler Army Medical Center Monday. I've been volunteering there since early 2003 so I know most of the long-term residents.
One such resident, a Navy fighter pilot, was absent. I call him "Top Gun" since he not only has to take off and land a jet while fighting wind conditions which throws the plane into yaws and unplanned banks, he must also do so while his tiny landing strip is also moving side to side and back to front.
Top, I believe, is the recipient of the Navy Cross. It's difficult to confirm these things because vets don't like talking about themselves and their achievements. He also used to play the guitar and loved music. That is, until he ended up with a body that is totally broken and can't move his hands or legs. If his nose is running, he needs to call for help so someone can wipe his face for him. Calling for help is a very difficult thing to do for a vet who is trained and conditioned to adapt and improvise in everyday life.
Mr. Gun was the first one in the room every Monday morning. I begin at 10 so I arrive at 9:45 to set up my keys and sound system. And there was Top waiting for the music to begin. I found out that he was younger than me (at my age, everyone's younger than me) having been born in 1947. That was noted only because when people sit in wheelchairs with broken bodies, they look older than they really are.
He loved the old ballads so I planned to sing Sinatra songs for the first part of the show and then switch to patriotic music in celebration of Armed Forces month and Memorial Day. Memorial Day is a Federal Holiday so I normally skip those days because they are short on staff on holidays.
Then, one of the staff members came up to me and told me that Top had passed away this past weekend. I felt a heaviness in the atmosphere that morning and that confirmed my uneasiness. Top was loved by residents and staff alike. His passing also reminds everyone we are all vulnerable and that makes us uneasy.
As a volunteer at nursing homes and at the hospice, I've accepted that each visit may very well be the last interaction I may have with a person. I work hard at finding music and songs that will feed that person's soul for the brief hour that I'm there. If I can bring peace to the person through music, I've done something useful.
I dedicated one of the numbers "Swing Low, Sweet Chariot" to Top that morning. And some songs like "America the Beautiful" were difficult to get through. Most of these vets have at least one American flag attached to their wheelchair. If you want to witness people who love their country and the Constitution that they have vowed to defend, visit a Veterans' Hospital or facility.
I am reminded of the Rambo line, "I love my country, but my country doesn't love me".
Someone sent me the following so I can't give credit to the author:
It is the Veteran, not the Preacher who has given us freedom of religion.
It is the Veteran, not the reporter who has given us freedom of the press.
It is the Veteran, not the poet who has given us freedom of speech.
It is the Veteran, not the campus organizer who has given us the freedom to assemble.
It is the Veteran, not the lawyer who has given us the right to a fair trial.
It is the Veteran, not the politician who has given us the right to vote.
Have a safe Memorial Day!
I performed at the Center for the Aging on the grounds of Tripler Army Medical Center Monday. I've been volunteering there since early 2003 so I know most of the long-term residents.
One such resident, a Navy fighter pilot, was absent. I call him "Top Gun" since he not only has to take off and land a jet while fighting wind conditions which throws the plane into yaws and unplanned banks, he must also do so while his tiny landing strip is also moving side to side and back to front.
Top, I believe, is the recipient of the Navy Cross. It's difficult to confirm these things because vets don't like talking about themselves and their achievements. He also used to play the guitar and loved music. That is, until he ended up with a body that is totally broken and can't move his hands or legs. If his nose is running, he needs to call for help so someone can wipe his face for him. Calling for help is a very difficult thing to do for a vet who is trained and conditioned to adapt and improvise in everyday life.
Mr. Gun was the first one in the room every Monday morning. I begin at 10 so I arrive at 9:45 to set up my keys and sound system. And there was Top waiting for the music to begin. I found out that he was younger than me (at my age, everyone's younger than me) having been born in 1947. That was noted only because when people sit in wheelchairs with broken bodies, they look older than they really are.
He loved the old ballads so I planned to sing Sinatra songs for the first part of the show and then switch to patriotic music in celebration of Armed Forces month and Memorial Day. Memorial Day is a Federal Holiday so I normally skip those days because they are short on staff on holidays.
Then, one of the staff members came up to me and told me that Top had passed away this past weekend. I felt a heaviness in the atmosphere that morning and that confirmed my uneasiness. Top was loved by residents and staff alike. His passing also reminds everyone we are all vulnerable and that makes us uneasy.
As a volunteer at nursing homes and at the hospice, I've accepted that each visit may very well be the last interaction I may have with a person. I work hard at finding music and songs that will feed that person's soul for the brief hour that I'm there. If I can bring peace to the person through music, I've done something useful.
I dedicated one of the numbers "Swing Low, Sweet Chariot" to Top that morning. And some songs like "America the Beautiful" were difficult to get through. Most of these vets have at least one American flag attached to their wheelchair. If you want to witness people who love their country and the Constitution that they have vowed to defend, visit a Veterans' Hospital or facility.
I am reminded of the Rambo line, "I love my country, but my country doesn't love me".
Someone sent me the following so I can't give credit to the author:
It is the Veteran, not the Preacher who has given us freedom of religion.
It is the Veteran, not the reporter who has given us freedom of the press.
It is the Veteran, not the poet who has given us freedom of speech.
It is the Veteran, not the campus organizer who has given us the freedom to assemble.
It is the Veteran, not the lawyer who has given us the right to a fair trial.
It is the Veteran, not the politician who has given us the right to vote.
Have a safe Memorial Day!
Sunday, April 24, 2011
HIGH ENERGY COSTS HURT OUR KUPUNAS
HIGH ENERGY COSTS HURT OUR KUPUNAS
When energy costs rise, then costs for everything else rise. It takes energy to produce food, construct housing, transport goods and services as well as to energize our homes and transport us to work. Let's look at what causes our energy costs to rise.
Many people, particularly the politicians and the media, will tell you that the oil companies are gouging us and making huge profits because they have a monopoly or oligopoly. Perhaps they are correct. More likely, though, are the following factors that play into the mix.
FUTURES SPECULATORS. There is a market for commodities called the futures market. Individuals and various financial entities buy contracts of certain goods like grain, corn, pork, etc. in order to hedge themselves against a rising market. Included as commodities is the oil market.
When a person believes that the price of oil is going to rise to $140 a barrel and the price of that barrel, if purchased now, is at $100, then the person buys the contract at $100 now so that he has oil at $100 while everyone else has to pay the "spot" price of $140. The market goes one step further by allowing for the person to buy the option of purchasing at $100 sometime in the future for a small percentage of the actual price of a barrel of oil.
This gives the person a hedge against the increase in the price of oil by paying the option price, say $10. If the price of oil stays the same or goes down, they let the option expire without exercising the option. Thus, the oil companies ( or energy companies) can insure themselves that they won't get caught with huge increases in oil prices by buying options. California's PG & E put the state into bankruptcy because they refused to buy futures and when the spot prices spiked, they had to substantially increase energy costs immediately or go belly-up.
If, however, you're one of those who believe the politicians that the energy companies are gouging the public and reaping huge profits on the backs of the people, then you should buy energy stocks. Being a crybaby won't do any good.
NO NEW REFINERIES. The EPA has made it so expensive to build new refineries that no new refinery has been put in service for at least 35 years in the U.S. Yet, demand for refined oil and gas has continued to rise each year. The old refineries are outdated and inefficient, but repairing these refineries is a lot less expensive than building new plants. Environmental impact statements, public hearings and regulations make building new refineries in the U.S. too expensive. It's easier to build the new plant overseas and import the refined products back into the U.S.
OUR GOVERNMENT REFUSES TO ALLOW DRILLING IN THE U.S. The United States has huge amounts of oil and gas in the continental United States. We have huge amounts available offshore but the companies are prohibited from drilling by our government. Yet, U.S. taxpayers are funding other countries like Brazil to drill in the Gulf in exchange for the rights to buy the oil they produce. Yes, we pay them twice and lose American jobs in the process. Thus, the cost to the U.S. consumer goes up.
ETHANOL. We require that our gas be blended with ethanol because we want to encourage "green" energy in the U.S. Ethanol is a lot more expensive to produce than oil. We use much energy to plant, harvest and refine the corn into energy. These laws also take the corn and grain out of the food supply so the costs of these items go up at the retail store. Corn and grain are also used as feed for livestock so the price of beef, pork and poultry also goes up. So, the U.S. citizen again pays double for things because of government interference in the free markets.
Ethanol has also caused some fuel tanks, lines and injectors to break down. If you have a tank for your boat made of fiberglass, that tank will break down and the particles will get into your fuel system and clog your injectors/carburetors. So you have to do some expensive retrofitting to assure yourself that you won't get caught at sea when your engine fails.
DIFFERENT BLENDS OF GAS REQUIRED BY DIFFERENT STATES. Some states require as many as 10 different blends of gas to be offered to the consumers. These blends may change with the seasons. The refineries must not only make sure that they have the right amounts of gas at different blends available at all times, but must shut down to reconfigure the plant every time they change the production of the different blends.
Can you imagine the inventory headache caused by these regulations? If you have a lawnmower that requires one type of fuel, a car that requires another type of fuel, a gas blower requiring yet another type of fuel and a chain saw requiring another type of fuel, you'd have to keep a gallon of each type on hand rather than just one gallon to refuel your powered tools.
DOLLAR IS WEAKENED. The United States has printed trillions of dollars in the past three years. The dollar is the currency of record in the world markets. The dollar is used to measure the cost of oil. It is the dollar that has gone down. The oil has not gone up in price. China, the Soviets and other countries are meeting right now to replace the dollar as the currency of record. When that happens, you will see chaos in the world's financial markets. That includes oil.
It would be interesting to see how people recharge electric cars without the cost of electricity going up. Electricity is produced by burning oil or other fuels so it's unlikely that electric cars can be considered "green" and safe for the environment. The electric companies don't yet have the infrastructure in place to use solar, wind and geothermal energy.
When these costs go up, it hurts everyone. The Kupunas are the most vulnerable because the vast majority of them are on fixed incomes.
When energy costs rise, then costs for everything else rise. It takes energy to produce food, construct housing, transport goods and services as well as to energize our homes and transport us to work. Let's look at what causes our energy costs to rise.
Many people, particularly the politicians and the media, will tell you that the oil companies are gouging us and making huge profits because they have a monopoly or oligopoly. Perhaps they are correct. More likely, though, are the following factors that play into the mix.
FUTURES SPECULATORS. There is a market for commodities called the futures market. Individuals and various financial entities buy contracts of certain goods like grain, corn, pork, etc. in order to hedge themselves against a rising market. Included as commodities is the oil market.
When a person believes that the price of oil is going to rise to $140 a barrel and the price of that barrel, if purchased now, is at $100, then the person buys the contract at $100 now so that he has oil at $100 while everyone else has to pay the "spot" price of $140. The market goes one step further by allowing for the person to buy the option of purchasing at $100 sometime in the future for a small percentage of the actual price of a barrel of oil.
This gives the person a hedge against the increase in the price of oil by paying the option price, say $10. If the price of oil stays the same or goes down, they let the option expire without exercising the option. Thus, the oil companies ( or energy companies) can insure themselves that they won't get caught with huge increases in oil prices by buying options. California's PG & E put the state into bankruptcy because they refused to buy futures and when the spot prices spiked, they had to substantially increase energy costs immediately or go belly-up.
If, however, you're one of those who believe the politicians that the energy companies are gouging the public and reaping huge profits on the backs of the people, then you should buy energy stocks. Being a crybaby won't do any good.
NO NEW REFINERIES. The EPA has made it so expensive to build new refineries that no new refinery has been put in service for at least 35 years in the U.S. Yet, demand for refined oil and gas has continued to rise each year. The old refineries are outdated and inefficient, but repairing these refineries is a lot less expensive than building new plants. Environmental impact statements, public hearings and regulations make building new refineries in the U.S. too expensive. It's easier to build the new plant overseas and import the refined products back into the U.S.
OUR GOVERNMENT REFUSES TO ALLOW DRILLING IN THE U.S. The United States has huge amounts of oil and gas in the continental United States. We have huge amounts available offshore but the companies are prohibited from drilling by our government. Yet, U.S. taxpayers are funding other countries like Brazil to drill in the Gulf in exchange for the rights to buy the oil they produce. Yes, we pay them twice and lose American jobs in the process. Thus, the cost to the U.S. consumer goes up.
ETHANOL. We require that our gas be blended with ethanol because we want to encourage "green" energy in the U.S. Ethanol is a lot more expensive to produce than oil. We use much energy to plant, harvest and refine the corn into energy. These laws also take the corn and grain out of the food supply so the costs of these items go up at the retail store. Corn and grain are also used as feed for livestock so the price of beef, pork and poultry also goes up. So, the U.S. citizen again pays double for things because of government interference in the free markets.
Ethanol has also caused some fuel tanks, lines and injectors to break down. If you have a tank for your boat made of fiberglass, that tank will break down and the particles will get into your fuel system and clog your injectors/carburetors. So you have to do some expensive retrofitting to assure yourself that you won't get caught at sea when your engine fails.
DIFFERENT BLENDS OF GAS REQUIRED BY DIFFERENT STATES. Some states require as many as 10 different blends of gas to be offered to the consumers. These blends may change with the seasons. The refineries must not only make sure that they have the right amounts of gas at different blends available at all times, but must shut down to reconfigure the plant every time they change the production of the different blends.
Can you imagine the inventory headache caused by these regulations? If you have a lawnmower that requires one type of fuel, a car that requires another type of fuel, a gas blower requiring yet another type of fuel and a chain saw requiring another type of fuel, you'd have to keep a gallon of each type on hand rather than just one gallon to refuel your powered tools.
DOLLAR IS WEAKENED. The United States has printed trillions of dollars in the past three years. The dollar is the currency of record in the world markets. The dollar is used to measure the cost of oil. It is the dollar that has gone down. The oil has not gone up in price. China, the Soviets and other countries are meeting right now to replace the dollar as the currency of record. When that happens, you will see chaos in the world's financial markets. That includes oil.
It would be interesting to see how people recharge electric cars without the cost of electricity going up. Electricity is produced by burning oil or other fuels so it's unlikely that electric cars can be considered "green" and safe for the environment. The electric companies don't yet have the infrastructure in place to use solar, wind and geothermal energy.
When these costs go up, it hurts everyone. The Kupunas are the most vulnerable because the vast majority of them are on fixed incomes.
Thursday, April 14, 2011
SCAMS AGAINST OLDER MEN... BEWARE
Editor's Note: I've had a number of emails inquiring about new articles. I've had some issues come up the past few weeks, but one of the emailers was kind enough to offer a warning for all the older men who read my blog.
Warning: Scam Against Older Men
Women often receive warnings about protecting themselves at the mall and in dark parking lots, etc. This is the first warning I have seen for men. I wanted to pass it on in case you haven't heard about it.
A 'heads up' for those men who may be regular customers at Lowe's, Home Depot, Costco, or even Wal-Mart. This one caught me totally by surprise.
Over the last month I became a victim of a clever scam while out shopping. Simply going out to get supplies has turned out to be quite traumatic. Don't be naive enough to think it couldn't happen to you or your friends.
Here's how the scam works:
Two nice-looking, college-aged girls will come over to your car or truck as you are packing your purchases into your vehicle. They both start wiping your windshield with a rag and Windex, with their breasts almost falling out of their skimpy T-shirts. (It's impossible not to look). When you thank them and offer them a tip, they say 'No' but instead ask for a ride to McDonald's.
You agree and they climb into the vehicle. On the way, they start undressing. Then one of them starts crawling all over you and having her way with you, while the other one steals your wallet.
I had my wallet stolen Mar. 4th, 9th, 10th, twice on the 15th, 17th, 20th, 24th, & 29th. Also Apr. 1st & 4th, twice on the 8th, 15th, and very likely again this upcoming weekend.
So tell your friends to be careful. What a horrible way to take advantage of us older men. Warn your friends to be vigilant.
Wal-Mart has wallets on sale for $2.99 each. I found even cheaper ones for $.99 at the dollar store and bought them out in three of their stores.
Also, you never get to eat at McDonald's. I've already lost 11 pounds just running back and forth from Lowe's, to Home Depot, to Costco, Etc.
So please, send this on to all the older men that you know and warn them to be on the lookout for this scam. (The best times are just before lunch and around 4:30 in the afternoon).
Warning: Scam Against Older Men
Women often receive warnings about protecting themselves at the mall and in dark parking lots, etc. This is the first warning I have seen for men. I wanted to pass it on in case you haven't heard about it.
A 'heads up' for those men who may be regular customers at Lowe's, Home Depot, Costco, or even Wal-Mart. This one caught me totally by surprise.
Over the last month I became a victim of a clever scam while out shopping. Simply going out to get supplies has turned out to be quite traumatic. Don't be naive enough to think it couldn't happen to you or your friends.
Here's how the scam works:
Two nice-looking, college-aged girls will come over to your car or truck as you are packing your purchases into your vehicle. They both start wiping your windshield with a rag and Windex, with their breasts almost falling out of their skimpy T-shirts. (It's impossible not to look). When you thank them and offer them a tip, they say 'No' but instead ask for a ride to McDonald's.
You agree and they climb into the vehicle. On the way, they start undressing. Then one of them starts crawling all over you and having her way with you, while the other one steals your wallet.
I had my wallet stolen Mar. 4th, 9th, 10th, twice on the 15th, 17th, 20th, 24th, & 29th. Also Apr. 1st & 4th, twice on the 8th, 15th, and very likely again this upcoming weekend.
So tell your friends to be careful. What a horrible way to take advantage of us older men. Warn your friends to be vigilant.
Wal-Mart has wallets on sale for $2.99 each. I found even cheaper ones for $.99 at the dollar store and bought them out in three of their stores.
Also, you never get to eat at McDonald's. I've already lost 11 pounds just running back and forth from Lowe's, to Home Depot, to Costco, Etc.
So please, send this on to all the older men that you know and warn them to be on the lookout for this scam. (The best times are just before lunch and around 4:30 in the afternoon).
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