Bill Gates best trade since retiring has been shorting Ballmer!

After giving away $28 billion, Bill Gates is no longer the third-richest man in the world. He’s the second-richest.

You read that right. Despite his considerable, praiseworthy charity work, the Microsoft cofounder is getting wealthier. In 2012, he wound up $7 billion ahead with a net worth of $63.4 billion, according to Bloomberg’s Billionaires Index…

Bill Gates has been aggressively selling down his Microsoft position for over a decade. Early on, this looked like a smart idea just on the basic tenets of diversification alone. But when he didn’t stop at 50% of his net worth, and went all the way down to the point where Microsoft was only a piddling 20% of his net worth, you could argue that this was more than just diversification.

Somewhere along the line, this massive and ongoing liquidation became a short-sale of his old friend (and current Microsoft CEO) Steve Ballmer. And it looks to have been a smart “trade”.

What triggered it? Was it the borderline breakeven profitability of the XBox after so many years of investment? How about the flaming wreckage of Microsoft’s internet properties and search game? Maybe it was the launch of the Zune ecosystem that wasn’t? Or perhaps he decided to sell more aggressively the day when Ballmer mocked the iPhone and mentioned that his kids were forbidden to own one.

Maybe it was just the cumulative effect of these embarrassments or missed opportunities – one after another. Either way, Gates’s sales have gone far beyond any kind of diversification that we’ve seen with the Google whiz kids or Larry Ellison over at Oracle. While the billionaire has remained almost completely silent on Microsoft’s loss of luster and standing, his trading activities have spoken volumes…

Joshua Brown ends his piece with an admonition to diversify. The body of the article says a lot more.

Steve Ballmer hasn’t a clue!

Gun control PAC launched by Gaby Giffords and Mark Kelly

Former Rep. Gabrielle Giffords and her husband launched a political action committee aimed at curbing gun violence on Tuesday as her Arizona hometown paused to mark the second anniversary of a deadly shooting rampage that left her with severe injuries.

Tucson residents rang bells at 10:11 a.m. – the moment a mentally ill gunman opened fire on Giffords as she met with constituents in 2011, killing six people and leaving 12 others injured. Mayor Jonathan Rothschild rang a bell at a fire station 19 times – one for each victim…

Giffords also took a prominent role in the gun debate on the anniversary. She and husband Mark Kelly, a former astronaut, wrote in an op-ed published in USA Today that their Americans for Responsible Solutions initiative would help raise money to support greater gun control efforts.

“Achieving reforms to reduce gun violence and prevent mass shootings will mean matching gun lobbyists in their reach and resources,” the couple wrote in the column. They said that it will “raise funds necessary to balance the influence of the gun lobby…”

The couple last week visited Newtown, Conn., where a gunman opened fire in an elementary school, killing 20 children and six adults in December. They also met with New York City Mayor Michael Bloomberg, a billionaire who has spent some of his fortune in recent years on gun control efforts…

In the op-ed piece, Kelly and Giffords discussed what they deem lawmakers’ inaction on curbing gun violence.

“In response to a horrific series of shootings that has sown terror in our communities, victimized tens of thousands of Americans, and left one of its own bleeding and near death in a Tucson parking lot, Congress has done something quite extraordinary – nothing at all,” Giffords and Kelly wrote in the op-ed.

“This country is known for using its determination and ingenuity to solve problems, big and small. Wise policy has conquered disease, protected us from dangerous products and substances, and made transportation safer. But when it comes to protecting our communities from gun violence, we’re not even trying – and for the worst of reasons…”

I wish them success. I will do my best to keep up the pressure on those who are in bed with gun manufacturers, the greedy bastards who own a controlling interest in the ideologues of the NRA. In turn, of course, the Republican Party is completely subservient to that particular industry of death. They don’t differentiate between hunting and murder. Immoderate killing has been up there with motherhood and apple pie in the GOP for decades.

Democrats OTOH are ruled more by cowardice than conviction – though being bankrolled by the NRA ain’t half bad even if you’re an opportunist. The funny bit is that the NRA hasn’t been able to deliver on their threats one way or the other in years.

New ways to study permafrost and climate change

Susan Hubbard - radar
Susan Hubbard collecting ground-penetrating radar data

What does pulling a radar-equipped sled across the Arctic tundra have to do with improving our understanding of climate change? It’s part of a new way to explore the little-known world of permafrost soils, which store almost as much carbon as the rest of the world’s soils and about twice as much as is in the atmosphere.

The new approach combines several remote-sensing tools to study the Arctic landscape—above and below ground—in high resolution and over large spatial scales. It was developed by a group of researchers that includes scientists from the U.S. Department of Energy’s Lawrence Berkeley National Laboratory (Berkeley Lab).

They use ground-penetrating radar, electrical resistance tomography, electromagnetic data, and LiDAR airborne measurements. Together, these tools allow the scientists to see the different layers of the terrestrial ecosystem, including the surface topography, the active layer that seasonally freezes and thaws, and the deeper permafrost layer.

The goal is to help scientists determine what will happen to permafrost-trapped carbon as the climate changes. Will it stay put? Or will it enter the atmosphere and accelerate climate change..?

The scientists tested their system on a plot of land near Barrow, Alaska, that measures about 500 meters long and 40 meters wide. Hubbard and her team conducted their first field campaign at the site last fall when the system was freezing up. They’ve since returned several times to conduct more research…

The scientists use data from airborne Lidar, surface geophysical measurements, and point measurements to explore the complex relationships between different layers of permafrost soil.

The scientists also used three tools to explore the hidden world below the surface. Ground-penetrating radar was pulled from one end of the plot to the other. They set up a string of electrodes at different locations to conduct electrical resistance tomography measurements. Electromagnetic data was collected along more than a dozen lines that spanned the length of the plot. The scientists also collected point measurements of temperature, moisture, and other properties at several locations to verify the data from the remote-sensing tools.

These geophysical measurements, coupled with the point measurements, allowed the scientists to see how the different layers of the permafrost system vary spatially, including the topography, the active layer, and the deeper permafrost. They could also see how these layers relate to each other…

“Overall, this combination of methods helps us understand the spatial and temporal interactions between surface microtopography, the active layer that controls soil respiration and generation of greenhouse gasses, and the deeper permafrost layer, which controls the formation of the polygonal features,” says Susan Hubbard. “This approach also allows us to sample over large spatial regions with minimal disturbance to the ecosystem—two important criteria when it comes to studying the vast and delicate Arctic landscape.”

Bravo! And yet more information worth reading in detail if you care to be well-informed on all aspects of questions dealing with climate change.

Washington is fixing the debt crisis – sort of

The Financial Times is one of those newspaper websites with a paywall. Not one of those I consider worth subscribing to. Since Altman’s Op-Ed piece is brief, I’ll include the whole unedited piece below:

I asked for coffee not hemlock
I asked for coffee not hemlock!

The last-second deal to avoid America’s fiscal cliff has been criticised by budget experts, the business community and the press. In the face of deficits still exceeding a breathtaking $1tn annually, they had hoped for a “grand bargain” – namely, a long-term, multitrillion-dollar package of revenue increases and spending cuts that would truly fix the debt problem. That did not happen. Instead, the deal is seen as too small and unbalanced, as it raises only modest amounts of revenue and cuts no spending. Outside Washington, no one has a good word for it.

Critics are transfixed by the bitter negotiations, however, and are missing the big picture. It may be happening in stages, but the US is making real progress towards reducing deficits and stabilising its debt. Indeed, according to the Committee for a Responsible Federal Budget, a Washington-based non-profit organisation, the federal debt to gross domestic product ratio – the critical measure of financial health – will be stable at about 73 per cent for the next decade. That is because annual deficits are now on track to be halved and, therefore, the debt level will not continue to grow faster than the economy. Yes, this ratio is still too high, but stabilising it will be a crucial achievement.

But with all the weeping over deficit and debt, how is this possible? The answer is that, in two months, a course for $3tn of deficit reduction over 10 years will be set. That is about three-quarters of the amount the much-praised bipartisan Simpson-Bowles presidential commission recommended in December 2010. And, using consensus assumptions on economic growth, it is enough to stabilise America’s debt ratio. Without it, the ratio would reach nearly 100 per cent, analogous to Italy’s. Yes, after 2022, it will worsen again – reflecting the ageing population and related health costs – and more fiscal tightening will be necessary. But 10 years is enough to find those additional solutions.

Continue reading

How Medicare Is misrepresented

A common phrase in the current debate over the so-called fiscal cliff is “Medicare needs to be restructured.” The term serves as code for policies unlikely to be appealing to voters, a term that can mean everything and, thus, nothing.

The question is what problem restructuring is to solve in traditional Medicare, which remains one of the most popular health insurance programs in this country. People who use this vague term should always be challenged to explain exactly why and how Medicare should be changed.

Critics of traditional Medicare – even those who should know better – often accuse it of being “fee for service.” It is a strange accusation. After all, fee-for-service remains the dominant method of paying the providers of health care under private insurance, including Medicare Advantage, the option of private coverage open to all Medicare beneficiaries.

Describing Medicare as fee-for-service insurance is about as thoughtful as describing a horse as “an animal that has four legs,” a characteristic shared by many other animals. The practice is particularly odd, given that traditional Medicare as early as the 1970s was the first program to develop so-called “bundled payments” for hospital inpatient care – the diagnostically related groupings, known as D.R.G. – in place of fee-for-service payment of hospitals, an innovation that has since been copied around the globe.

A more descriptive term for traditional Medicare would be “free choice of providers” or “unmanaged care” insurance. These features, of course, would hardly be viewed as shortcomings among people covered by traditional Medicare or their families. Neither term would be a good marketing tool among voters for proposals to abandon traditional Medicare…

A case can be made, on theoretical and sometimes empirical grounds, that properly managed or coordinated care can on average yield superior medical treatments, at lower cost, than completely unmanaged care under classical indemnity insurance.

The problem has been and continues to be that this is not the folklore among patients or doctors. The latter, as noted, generally believe they can manage their patients’ care properly without outside interference into their clinical decisions. Among patients and doctors, the term managed care is still not quite respectable.

This can explain why critics of traditional Medicare delicately but nonsensically prefer to decry it as being fee for service rather than as free-choice-of-providers insurance or unmanaged-care insurance.

I hadn’t seen Uwe Reinhardt on television in a spell when he popped up on Tom Keene’s SURVEILLANCE yesterday morning on Bloomberg TV. I had forgotten his dry wit and political economist’s accurate simplicity of definitions. The folks I can understand the easiest also often make the most sense.

This blog post is one the earliest of his current series on Medicare.

Meanwhile, click the link and RTFA. Education, it’s wonderful.

UK politician responsible for train fares uses chauffeur-driven government car to “avoid overcrowded trains”


Chauffeurs are people, too

The minister responsible for rail fares, Simon Burns, is under fire…after it emerged that he commutes to work using a chauffeur-driven government car. Burns, the Conservative MP for Chelmsford, travels the 35 miles between his home in Essex and Westminster using an £80,000-a-year departmental car service.

The news is likely to provoke more anger from commuters still reeling from the New Year inflation-busting rise in train fares last week…

According to a report in the Mail on Sunday Mr Burns uses a car to travel to work in order to avoid overcrowded trains.

A spokesman for passengers’ campaign group Railfuture told the newspaper: “It would be nice if the person who is setting these fare rises was also experiencing some of the congestion and overcrowding endured by ordinary, hard-pressed travellers.”

Mr Burns reportedly defended his regular use of the Department for Transport pool car by saying: “I have given up my second home in London and I commute to and from work carrying classified papers which I work on during my journey.”

He gave up his second home in London – gasp! My experience with London real estate suggests he probably made millions if he sold off something appropriate to his class and Conservative political party.