Friday, April 29, 2011

Royal Wedding

Okay, so you get up in the morning knowing you are attending the royal wedding, and you decide to put THAT on you head.  Someone did a REALLY GOOD sales job to get someone to put THAT thing on their head.




Thursday, April 28, 2011

The Importance of Walking

The Importance of Walking

As you know, I walk around the LSU lakes almost every day. Ok, ok, so not on Wednesday’s when I go to the Bulldog for a ‘few’ beers. And not so much when it is cold. And never in the rain. Yeah, yeah, yeah, it rains a lot in Louisiana. ALRIGHT, you get my point. I do it often!

Walking can add minutes to your life. This enables you at 85 years old to spend an additional 5 months in a nursing home at $7000 per month.

A grandpa started walking five miles a day when he was 60. Now he's 97 years old and we don't know where he is.

I like long walks, especially when they are taken by people who annoy me.

I have to walk early in the morning, before my brain figures out what I'm doing.

I joined a health club last year, spent about 400 bucks. Haven't lost a pound. Apparently you have to go there.

Every time I hear the dirty word 'exercise', I wash my mouth out with chocolate.

The advantage of exercising every day is so when you die, they'll say, 'Well, he looks good doesn't he.'

If you are going to try cross-country skiing, start with a small country.

I know I got a lot of exercise the last few years ......but I’m just getting over the hill.

We all get heavier as we get older, because there's a lot more information in our heads. That's my story and I'm sticking to it.


You could run this over to your friends, but just e-mail it to them!

Wednesday, April 27, 2011


Transitory: 1. Tending to pass away, not persistent 2. Of brief duration, temporary

So, it depends on what your definition of ‘persistent’ and ‘brief’ are.

The Bernanke Report

Okay, here is what I read between the lines from Bernanke’s Q&A with the financial press today.

1. Not likely to raise interest rate target until January 2012, so we are at ZERO short term interest rates for a while longer

2. Fed doesn’t feel that inflation is a problem, it’s “transitory”

3. Commodity price increases are “transitory”

4. Dollar is the sacrificial lamb, the Fed is going to let it fall in order to help the economy, exports, employment

That’s what I think his message was.

Thursday, April 21, 2011

Alabama Needs A Proofreader

College Football Nation: 3-point stance
By Ivan Maisel
April 21, 2011

Tide Seeking Proofreader

Alabama is among the top public universities in National Merit Scholars, none of whom works as proofreaders in the athletic department. Last season, the Crimson Tide printed football tickets for a game against Mississipi (sic) State. Last Saturday, with great fanfare, the athletic department unveiled a plaque honoring the 2009 national champions. Engraved on the plaque are the titles awarded the Tide, including the “McArthur Trophy.” That would be the MacArthur Trophy, named for General Douglas MacArthur. As every Merit Scholar knows, spell-check is not the same as proofreading.

Springtime Can Produce Some Ugly Football

“There are only two seasons.  Football season, and spring football season.”

Springtime Can Produce Some Ugly Football

It sounds like such a bright, cheery, happy event: a spring college-football game. In reality, these intrasquad scrimmages are often epic downers.

Spring-football games are widely anticipated, for they represent the last chance to gauge each team's progress until the fall. The trouble is, players are rusty, banged-up veterans are sidelined and coaches are working on new plays.

This has led to a brutal batch of statistics this spring. Tennessee quarterback Tyler Bray completed 5 of 30 passes in the Volunteers' spring game. Oklahoma, considered the betting favorite to win the national title, got a modest outing from returning quarterback Landry Jones (6 of 11, 40 yards, one interception). Nebraska quarterback Taylor Martinez, whose strength is running, seldom ran and completed just four of 13 throws. Florida fans were treated to a 4-of-14 showing by quarterback John Brantley, plus a plane carrying the banner "31-7 Go Noles!" flying overhead (a reference to rival Florida State's rout of the Gators last season).

Hyperventilating fans should take comfort in the knowledge that numerous teams have ugly outings—although Stanford's Andrew Luck was in top form (16 of 22, 165 yards, three touchdowns)—and that the results are hardly predictive. Last year, Cam Newton went 3 of 8 for 80 yards in Auburn's spring game. The fall turned out somewhat differently.

—Darren Everson

The Wall Street Journal.
Thursday, April 21st, 2011

Wednesday, April 20, 2011


In Louisiana politics is theater…
…but football is life.

The year is 2016 and the United States has just elected the first woman, a Louisiana State University graduate, as President of the United States, Susan Boudreaux.
A few days after the election the president-elect calls her father and says, 'So, Dad, I assume you will be coming to my inauguration?'

'I don't think so. It's a 30 hour drive, your mother isn't as young as she used to be, and my arthritis is acting up again.'
'Don't worry about it Dad, I'll send Air Force One to pick you up and take you home. And a limousine will pick you up at your door.'
'I don't know. Everybody will be so fancy. What would your mother wear?'
Oh Dad, replies Susan, 'I'll make sure she has a wonderful gown custom-made by the best designer in New York .'
'Honey,' Dad complains, 'you know I can't eat those rich foods you and your friends like to eat.'
The President-to-be responds, 'Don't worry Dad. The entire affair is going to be handled by the best caterer in New York, I"ll ensure your meals are salt free Dad, I really want you to come.
So Dad reluctantly agrees and on January 20, 2017, Susan Boudreaux is being sworn in as President of the United States. In the front row sits the new president's Dad and Mom. Dad noticing the senator sitting next to him leans over and whispers, 'You see that woman over there with her hand on the Bible, becoming President of the United States.
The Senator whispers back, 'Yes I do.'
Dad says proudly, "Her brother played football at LSU."

Tuesday, April 19, 2011

Only in Louisiana...

Only in Louisiana…

William Jefferson's attorney filed a motion in court yesterday to throw out 11 of the former congressman's 16 corruption charges, in part arguing that federal prosecutors attempted to make him look so bad that a federal appeals court won't be able to seriously examine the legal issues.


Oh wait…the trial took place in Virginia.

Apparently it's the "I'm guilty of too many crimes to get a fair trial" defense.

Monday, April 18, 2011

What Does Change In S&P Outlook Mean?

Okay, first of all, let’s get one thing straight.

In my estimation there is a ZERO percent chance that the U.S. will default on its debt.

Yes, ZERO, zilch, nada, none.

The U.S issues its debt in the U.S., denominated in the U.S. Dollar.  So, if the U.S. needs more money to pay its debt it just has to print more money.  Now of course the printing of dollars and increasing the money supply  just to pay debt would in very likely have other negative consequences (inflation, further downgrades, currency exchange rates, etc.).

And of course a downgrade of the U.S. debt rating would cost us more money in higher interest rates that we would have to pay on all of that debt, exasperating the problem.

So clearly the increase in the U.S.’s debt is becoming problematic and weighting on the markets.  Something has to be done about it.  So what is likely to be done about it? 

The first tangible sign comes on April 27th when the Federal Reserve (The Fed) Open Market Committee meets.  It is unlikely  to launch a third quantitative easing (QE3) and very likely to let QE2 expire.  Quantitative easing was an attractive policy tool after short-term target rates were cut to zero. By buying securities such as Treasury bonds, The Fed drove down interest rates in an effort to stimulate the economy.  And it sure seems to have worked.

But from published comments even the more dovish officials at The Fed seem to see little case for further asset purchases because the risks that led them to launch QE2 last autumn seem to have abated.  And of course the more hawkish officials at The Fed would likely become apoplectic if Bernanke tried to push for QE3.  So any debt increase caused by QE1 & QE2  is likely to be allowed to mature or be sold.

And Congress AND THE White House are talking about cutting the U.S debt.  At the same time.  In trillions of dollars. 

Who’d a thunk!


Bloomberg on S&P

    “The U.S. is the only large AAA rated country that saw its

debt rise during the crisis that until recently had no plan that

would reverse the trend, Steven Hess, senior credit officer at

Moody’s, said last week.”


Wire: BLOOMBERG News (BN) Date: Apr 18 2011  8:36:30

Standard & Poor’s Puts ‘Negative’ Outlook on U.S. AAA (1)


By Robert Burgess

     April 18 (Bloomberg) -- Standard & Poor’s put a

“negative” outlook on the U.S. AAA credit rating, citing

rising budget deficits and debt.

     “We believe there is a material risk that U.S. policy

makers might not reach an agreement on how to address medium-and

long-term budgetary challenges by 2013,” New York-based S&P

said in a report today. “If an agreement is not reached and

meaningful implementation does not begin by then, this would in

our view render the U.S. fiscal profile meaningfully weaker than

that of peer ‘AAA’ sovereigns.”

     Under President Barack Obama’s fiscal year 2012 budget,

released in February, the total debt subject to the ceiling

would be $20.8 trillion in 2016. The plan House Republicans

approved April 15, written by Budget Committee Chairman Paul

Ryan, would need a debt ceiling of at least $19.5 trillion,

according to data compiled by Bloomberg Government.

     Treasuries fell, reversing earlier gains, after S&P lowered

its outlook to negative from stable. The benchmark 10-year note

yielded as much as 3.45 percent in New York before trading

little changed at 3.43 percent. The dollar dropped 0.7 percent

to 82.58 yen and pared its gain versus the euro. The S&P 500

Index fell 1.5 percent.

     The Treasury Department projected that the government may

reach the $14.3 trillion debt ceiling limit as soon as mid-May

and run out of options for avoiding default by early July.

     Last week, Moody’s Investors Service said Obama’s plan to

cut $4 trillion in cumulative deficits within 12 years may be a

“positive” for the nation’s credit quality and mark a reversal

in the budget debate.

     The U.S. is the only large AAA rated country that saw its

debt rise during the crisis that until recently had no plan that

would reverse the trend, Steven Hess, senior credit officer at

Moody’s, said last week.


S&P Downgrades U.S. Outlook to Negative

S&P Downgrades U.S. Outlook to Negative

WASHINGTON (MNI) - The following text is the first part of a statment by Standard & Poor's Monday anouncing that it has revised its outlook on the U.S. sovereign ratings to negative from stable:

Overview: We have affirmed our 'AAA/A-1+' sovereign credit rating on the United States of America.

The economy of the U.S. is flexible and highly diversified, the country's effective monetary policies have supported output growth while containing inflationary pressures, and a consistent global preference for the U.S. dollar over all other currencies gives the country unique external liquidity.

Because the U.S. has, relative to its 'AAA' peers, what we consider to be very large budget deficits and rising government indebtedness and the path to addressing these is not clear to us, we have revised our outlook on the long-term rating to negative from stable.

We believe there is a material risk that U.S. policymakers might not reach an agreement on how to address medium- and long-term budgetary challenges by 2013; if an agreement is not reached and meaningful implementation does not begin by then, this would in our view render the U.S. fiscal profile meaningfully weaker than that of peer 'AAA' sovereigns.
Rating Action

On April 18, 2011, Standard & Poor's Ratings Services affirmed its 'AAA' long-term and 'A-1+' short-term sovereign credit ratings on the United States of America and revised its outlook on the long-term rating to negative from stable. Rationale Our ratings on the U.S. rest on its high-income, highly diversified, and flexible economy, backed by a strong track record of prudent and credible monetary policy. The ratings also reflect our view of the unique advantages stemming from the dollar's preeminent place among world currencies. Although we believe these strengths currently outweigh what we consider to be the U.S.'s meaningful economic and fiscal risks and large external debtor position, we now believe that they might not fully offset the credit risks over the next two years at the 'AAA' level.

The U.S. is among the most flexible high-income nations, with both adaptable labor markets and a long track record of opeess to capital flows. In addition, its public sector uses a smaller share of national income than those of most 'AAA' rated countries--including its closest peers, the U.K., France, Germany, and Canada (all AAA/Stable/A-1+)--which implies greater revenue flexibility.

Furthermore, the U.S. dollar is the world's most used currency, which provides the U.S. with unique external flexibility; the vast majority of U.S. trade flows and external liabilities are denominated in its own dollars. Recent depreciation of the currency has not materially affected this position, and we do not expect this to change in the medium term.

Despite these exceptional strengths, we note the U.S.'s fiscal profile has deteriorated steadily during the past decade and, in our view, has worsened further as a result of the recent financial crisis and ensuing recession. Moreover, more than two years after the begiing of the recent crisis, U.S. policymakers have still not agreed on a strategy to reverse recent fiscal deterioration or address longer-term fiscal pressures.

In 2003-2008, the U.S.'s general (total) government deficit fluctuated between 2% and 5% of GDP. Already noticeably larger than that of most 'AAA' rated sovereigns, it ballooned to more than 11% in 2009 and has yet to recover.

On April 13, President Barack Obama laid out his Administration's medium-term fiscal consolidation plan, aimed at reducing the cumulative unified federal deficit by U.S.$4 trillion in 12 years or less. A key component of the Administration's strategy is to work with Congressional leaders over the next two months to develop a commonly agreed upon program to reach this target. The President's proposals envision reducing the deficit via both spending cuts and revenue increases, and the adoption of a "debt failsafe" legislative mechanism that would trigger an across-the-board spending reduction if, by 2014, budget projections show that federal debt to GDP has not yet stabilized and is not expected to decline in the second half of the current decade.

The Obama Administration's proposed spending cuts include reducing non-security discretionary spending to levels similar to those proposed by the Fiscal Commission in December 2010, holding growth in base security (excluding war expenditure) spending below inflation, and further cost-control measures related to health care programs. Revenue would be increased via both tax reform and allowing the 2001 and 2003 income and estate tax cuts to expire in 2012 as currently scheduled--though only for high-income households. We note that the President advocated the latter proposal last year before agreeing with Republicans to extend the cuts beyond their previously scheduled 2011 expiration. The compromise agreed upon in December likely provides short-term support for the economic recovery, but we believe it also weakens the U.S.'s fiscal outlook and, in our view, reduces the likelihood that Congress will allow these tax cuts to expire in the near future. We also note that previously enacted legislative mechanisms meant to enforce budgetary discipline on future Congresses have not always succeeded.

Key members in the U.S. House of Representatives have also advocated fiscal tightening of a similar magnitude, U.S.$4.4 trillion, during the coming 10 years, but via different methods. House Budget Committee Chairman Paul Ryan's plan seeks to balance the federal budget by 2040, in part by cutting non-defense spending. The plan also includes significantly reducing the scope of Medicare and Medicaid, while bringing top individual and corporate tax rates lower than those under the 2001 and 2003 tax cuts.

We view President Obama's and Congressman Ryan's proposals as the starting point of a process aimed at broader engagement, which could result in substantial and lasting U.S. government fiscal consolidation. That said, we see the path to agreement as challenging because the gap between the parties remains wide. We believe there is a significant risk that Congressional negotiations could result in no agreement on a medium-term fiscal strategy until after the fall 2012 Congressional and Presidential elections. If so, the first budget proposal that could include related measures would be Budget 2014 (for the fiscal year begiing Oct. 1, 2013), and we believe a delay beyond that time is possible.

Friday, April 15, 2011

Remedial Economics (aka Economics For Dummies)

Okay, I have been asked by more than one person (actually more than two) for further explanation of my CPI/Inflation email.  So here goes:

This month’s indication of price inflation as measured by the Consumer Price Index increased to an annual rate of 2.7%, taking all factors into consideration.  That is up from last month’s rate of 2.1% annual rate. Using simple math that’s a 28% increase.  So, inflation is picking up.  A little inflation is not so bad.  A lot of inflation is not so good.

However, the Federal Reserve Board of Governors (aka “The Fed”) does not use that rate when they meet to determine economic policy, they use what is called the “Core” CPI number, which takes out some of the more volatile things that can be influenced by seasonality or weather, like food and energy prices.  That number was 1.2% this month as compared to 1.1% last month.  Once again using simple math, that’s a 9% increase.

However, most consumers shop for groceries and fill up with gas very regularly, so most consumers feel the inflation of food and energy prices from week to week and month to month.

The Fed uses these CPI inflation numbers (along with a lot of other things) to help them do things like set interest rate targets.  Their interest rate targets are important because it influences things like bank deposit rates, bank lending rates, the relative attractiveness of stocks and bonds, and even the exchange rates for currencies like the Dollar, the Euro, the Yen, etc.  Now, The Fed doesn’t control all these prices, but its economic polices definitely influences them.

Generally speaking from a historic perspective, short term interest rates usually have hovered somewhere around the inflation rate.  Today the 3 month Treasury bill rate is yielding .07% (7 tenths of 1 percent).  That’s a far cry from either the Core CPI inflation rate of 1.2% or the more broad CPI inflation rate of 2.7%.  And so The Fed through its economic policies and market actions is helping to hold down the interest rate on Treasury bills, notes and bonds which in turn is making other assets (stocks, commodities, etc.) more attractive and helping drive their values up.  However, at some point The Fed is going to have to stop their market intervention  and at that point the all these markets will have to adjust to a new interest rate environment.

So the question is at what point should The Fed begin to let interest rates seek their normal market rates.  I think that time is upon us.  A majority of The Fed members apparently do not think like I do.  And I must point out they have a lot more PhD’s  than I do.  Well, actually, I don’t have a PhD so that’s a pretty low hurdle.  Still, if you’ve gone to the store to buy meat any time lately you have probably noticed that the price per pound has gone up.  And if you haven’t noticed that the price of gas at the pump has gone up then you probably do not drive a car (which apparently Ben Bernanke does not).

So, purely technically speaking, I think The Fed has do-do between their ears.

Inflation Is Creeping Up on Us


Okay, today’s headline number on CPI was 2.7% annualized.  That’s the number for anyone that eats and drives a car.  The Core CPI number was 1.20% annualized.  That’s the number for the Fed members who apparently do not need the nourishment or transportation that us mere mortals require.

Thursday, April 14, 2011

Golfer Kills Wife


Golfer Kills Wife Accidentally ......

Boudreaux was teeing off from the mens' tee.  On his downswing, he realized that his wife, Clotile, was teeing up on the woman's tee directly in front of him.  Unable to stop his swing, he nailed it, hitting Clotile directly in the temple, killing her instantly.  A few days later, Boudreaux got a call from the coroner regarding her autopsy.

Coroner : "Boudreaux, your wife Clotile seemed to have died from blunt force trauma to the head.  You said you hit a golf ball and hit her in the temple, is that correct?"
Boudreaux : "Mey yea sir, dat's correct.."
Coroner : "Well, inexplicably I found a golf ball wedged between butt cheeks."

Boudreaux : "Was it a Titlist Pro V1?"

Coroner : "Yes, it was."

Boudreaux : "Mey, dat was my mulligan."

Wednesday, April 13, 2011

NOLA's YLC Wednesday at the Square

THIS MAY BE THE BEST FREE MUSIC LINE UP IN AMERICA.  I can’t make it in the middle of the work week, but if you are in New Orleans on Wednesday’s, this is hard to beat.


YLC Wednesday at the Square

Wednesdays from 5-7:30 pm

March 30 to June 15, 2011


YLC Wednesday at the Square is a free, 12-week concert series with food and drink for sale to benefit the Young Leadership Council of New Orleans. It is located at Lafayette Square on St. Charles Avenue in the CBD across from Gallier Hall. Local artisans also sell their work in the Artist Village near the Camp Street entrance. Concerts are held every Wednesday from March 30 to June 15, 2011 from 5:00 to 7:30 pm, rain or shine.



APR 13  Kermit Ruffins + COOT

APR 20  Anders Osborne + Honey Island Swamp Band

APR 27  Irvin Mayfield & the Jazz Playhouse Revue

MAY 4  Marcia Ball + Gal Holiday & the Honky Tonk Revue

MAY 11  George Porter, Jr. + The Lee Boys

MAY 18  The Iguanas + Los Po-Boy-Citos

MAY 25  Tab Benoit + Navy Band New Orleans Full Steam Brass Band

JUN 1  Eric Lindell + The Revivalists

JUN 8  Galactic + Marc Stone

JUN 15  Cyril Neville and Monk Boudreaux + Gravy


John Broussard


Wednesday, April 6, 2011

What Are Your Plans For Easter?

What are your plans for Easter? Since I no longer have small children I was thinking that maybe a good idea would be to plan an adult Easter. With adult Easter games, like Easter Keg Hunt and such.


Tuesday, April 5, 2011

New Dodd-Frank Fee Shakes Up a Key Lending Market

The Law of Unintended Consequences

Please refer back to the joke I sent you yesterday.

-----Original Message-----

Follow up from market activity since late last week....

New Fee Shakes Up a Lending Market

The money market has been roiled by a sudden shortage of Treasury securities, another unintended consequence of government involvement in financial markets.

The disappearance of Treasurys in recent days has created a scramble among banks and investors, who depend on a fluid supply for short-term borrowing and lending. It is an unusual event, considering the market is generally awash in Treasurys, with about $9 trillion outstanding.

But recent rule changes mandated by the Dodd-Frank laws have made it too expensive for some banks to offer out their Treasurys holdings as part of a key overnight lending market known as the repurchase or "repo" market.

Banks typically borrow in this market, using Treasurys as collateral, parking the cash with the Federal Reserve and earning a better interest rate. Investors and money market funds use the market to lend out their cash overnight and earn a small return.

The lack of supply was so severe on Monday, and some investors so desperate for Treasurys, that they accepted negative yields—effectively paying to lend money to the banks. That is something that has rarely been seen since the financial crisis.

Exacerbating the problem, the Treasury has stopped selling some short-term Treasurys amid the debate in Washington over the government debt ceiling. At the same time, the Federal Reserve is suctioning up most of the new Treasurys that the government is selling, adding to the shortage of Treasury supply.

"It is a perfect storm of collateral being pulled from the market when it is most needed," said Thomas Roth, executive director in the U.S. government bond-trading group at Mitsubishi UFJ Securities (USA) Inc. in New York.

Joseph Abate, money-market strategist at Barclays Capital, noted that about $40 billion in repo collateral abruptly disappeared on Friday, in what traders said was one or more big banks exiting the market.

Banks have pulled back on their repo activity since the Federal Deposit Insurance Corp. imposed an added charge on bank repos as of April 1.

The new assessment was designed to better reflect the risks on individual banks' balance sheets by charging them for liabilities, including repo-market activities, instead of just their deposits.

An FDIC spokesman declined to comment on the market impact.

The average interest rate investors receive for lending Treasury debt in that market have fallen to nearly zero from about 0.15% since the end of March, according to Scott Skyrm, head of repo trading at Newedge USA in New York.

Rates have been ratcheting lower for some time, making the money market "an ever-worsening house of pain," Anthony Crescenzi, portfolio manager at Pacific Investment Management Co., or Pimco, wrote in an email.

So far, the tensions in the markets have been mild compared with the 2008 financial crisis, when the money market essentially seized up.

Still, the decline of repo rates, if it lasts very long, could be bad news for money-market funds that make money by lending Treasurys to banks and other investors.

There is an outside chance that long-term disruption of the repo market, a key source of funding for many corners of the economy, could eventually lead to higher borrowing costs more broadly.

Most think the turmoil will be temporary, and the Fed would likely intervene before too much damage was done.

"I think the market has overreacted here a bit and will probably go back to its equilibrium level," Mr. Abate said. "I'm just not sure how quickly."

It is possible that the market could be in some upheaval at least until the resolution of the debate in Congress over the U.S. government's debt ceiling.

That is because a shortage of available Treasurys for use as repo collateral seems to be a major factor driving repo rates lower.

That Treasury shortage, in turn, is partly due to some short-term Treasury debt issuance being on hold until the debt-ceiling issue is settled.

For now, the government is probably not complaining about the shortage of Treasurys, which is driving its borrowing costs lower for now. Prices on Treasury debt have risen sharply since Friday, driving yields—which move in the opposite direction—lower.

The six-month Treasury bill's yield fell to a low of 0.122%, a record, on Monday.

Late afternoon, the benchmark 10-year note was 5/32 higher to yield 3.429%. The two-year note rose 2/32 to yield 0.774%.

At the same time, the repo market is flooded with cash being pumped by the Fed in an effort to goose the economic recovery. One possible solution for the current turmoil is for the Fed to stop buying, and even start lending out, some of its Treasurys.

But that would send mixed signals to the market while the Fed is still in the middle of its $600 billion Treasury buying program.

The Fed would likely rather deal with some short-term turmoil in the repo market than work against its own liquidity measures. And part of the Fed's intention with its liquidity pumping programs has been to make it more painful for investors to stay in cash, forcing them to buy riskier assets.

Monday, April 4, 2011

A Fairy Tale

I met a fairy today who said she would grant me one wish.
"I want to live forever," I said.
"Sorry" said the fairy, "I'm not allowed to grant wishes like that."
"Fine," I said, "I want to die after Congress gets their heads out of their asses."
"You crafty bastard," said the fairy.