New Bookmarks
Year 2006 Quarter 1:  January 1 - March 31 Additions to Bob Jensen's Bookmarks
Bob Jensen at Trinity University

For earlier editions of New Bookmarks go to 
Tidbits Directory --- 

Click here to search Bob Jensen's web site if you have key words to enter --- Search Site.
For example if you want to know what Jensen documents have the term "Enron" enter the phrase Jensen AND Enron. Another search engine that covers Trinity and other universities is at

Choose a Date Below for Additions to the Bookmarks File

March 31

February 28     

January 30     


March 31, 2006




Bob Jensen's New Bookmarks on March 31, 2006
Bob Jensen at Trinity University 

For earlier editions of New Bookmarks go to 

Click here to search Bob Jensen's web site if you have key words to enter --- Search Site.
For example if you want to know what Jensen documents have the term "Enron" enter the phrase Jensen AND Enron. Another search engine that covers Trinity and other universities is at

Fraud Updates ---
Bob Jensen's various threads ---
       (Also scroll down to the table at )

Facts about the earth in real time --- 
Sure wish there'd be a little good news today.  Think it over

Real time meter of the U.S. cost of the war in Iraq --- 

Stay up on the latest and the oldest hoaxes ---

I really like the Digital Duo show that appears weekly once again on PBS.  I found that you can bring up prior shows on your computer by going to,00.asp

Click Here for Tidbits and Quotations Between March 1 and March 31

Click Here for Humor Between March 1 and March 31

My music download page ---

My electronic literature page ---

My search helper page ---

"Common Name, Uncommon Valor:  The story of Paul Smith,
the Iraq War's only Medal of Honor recipient so far,"
The Wall Street Journal
, March 29, 2006 --- 

Since his days growing up in Tampa, Fla., the lanky kid with the slightly mischievous smile had wanted to be a soldier. By this bright morning, April 4, 2003, Sgt. First Class Paul Ray Smith had more than fulfilled his dream. He had served 15 of his 33 years in the U.S. Army, including three tours of duty in harm's way--in the Persian Gulf, Bosnia and Kosovo.

Now all his training, all his experience, all the instincts that had made him a model soldier, were about to be put to the test. With 16 men from his First Platoon, B Company, 11th Engineer Battalion, Sgt. Smith was under attack by about 100 troops of the Iraqi Republican Guard.

"We're in a world of hurt," he muttered.

That "world" was a dusty, triangular walled compound about half the size of a football field, near the Saddam Hussein International Airport, 11 miles from Baghdad. Sgt. Smith's engineers, or "sappers," had broken through the 10-foot-high concrete-block southern wall with a military bulldozer and begun turning the compound into a temporary "pen" for Iraqi prisoners as U.S. forces pressed their attack on the airport.

. . .

Sgt. Smith could have withdrawn as well, back south through the compound. But beyond it was a lightly defended aid station crowded with 100 combat casualties and medical personnel. To protect it from being overrun, Sgt. Smith chose to fight no matter what the odds. Under intense fire, Sgt. Smith's men heroically extracted all three wounded crewmen from the APC. Sgt. Smith then entered the vehicle, ordering Spc. Michael Seaman to join him as driver and "keep me loaded" with ammo belts. Sgt. Smith popped up out of the turret hatch and grabbed the grips of the .50-caliber machine gun mounted on top.

The Iraqis were practically on top of him. Coolly grasping the situation, Sgt. Smith ordered Spc. Seaman to back the APC south into the compound to a position half way down the eastern wall. There he could arc the big machine gun back and forth, from the gate entrance to the north, all along the western wall of the triangle, to the Iraqi occupied tower in the southwest corner to his left.

To fire the machine gun, Sgt. Smith had to stand in the APC's main hatch, his body exposed from the waist up to a withering fire coming at him from three directions. On the ground through the blur of combat, Sgt. Matthew Keller saw Sgt. Smith grimly firing measured bursts from atop the APC even as a hail of bullets hit around him.

Sgt. Keller yelled at him to get out. Sgt. Smith looked back at him and with a slight shake of his head, made a cutting motion across his throat with his right hand. Sgt. Keller would always remember the look in his eyes. "There was no fear in him whatsoever."

As Spc. Seaman, crouching in the adjoining hatch, fed him ammunition belts, Sgt. Smith directed an expert and murderous fire with the long-barreled M2, hitting Iraqis who tried to enter the compound through the gate or over the wall. He tried also to suppress renewed fire coming from the Iraqis in the guard tower to his left.

Finally, one of his fellow sappers, First Sgt. Timothy Campbell, led a small fire team which stole up to the tower and killed all Iraqis inside. But by this time, Sgt. Smith's machine gun had fallen silent. The attack had been broken. Nearly 50 Iraqi dead lay all over the area. Others were in retreat. But Sgt. Smith was now slumped in the turret hatch, blood soaking the front of his uniform.

Spc. Seaman jumped out of the vehicle in tears. "I told him we should just leave," he said. Pvt. Gary Evans drove the APC out of the compound at high speed to the nearby aid station.

But it was too late. When Medic Michelle Chavez tried to remove Sgt. Smith's helmet, she realized that it was holding his head together. A bullet--one of the last fired from the tower--had entered through Sgt. Smith's neck and traveled up into his brain, shattering his skull from the inside. There were 13 bullet holes peppered over his armored vest--the impact from any one of them enough to knock a man down. The vest's ceramic armor inserts, back and front, had been cracked in numerous places. "Sapper Seven," the wiry, hollow-cheeked guy who had been so hard on his men in training, so exacting, so insistent on "doing it right"; the guy who had led them into battle on the first day of the war with a rock-'n'-roll tape blaring from his Humvee; the guy who had personally got down on his knees in front of their convoy to patiently, carefully extract the deadly mines when they ran into a minefield near the Karbala Gap, was dead.

A chaplain and a sergeant in dress uniforms came to Birgit Smith's home near Fort Stewart, Ga., late on the night of April 4 to break the terrible news. Mrs. Smith, the German girl Paul had met and married during his tour of duty in Western Europe in 1992, listened numbly to her visitors. She fought the growing dread and pain by grasping at a desperate hope:

"Our name is so common," she said, tears welling up in her eyes. "Maybe it's a mistake."

There was no mistake. Paul Ray Smith had given his life protecting his men and his position. He had almost single-handedly blunted an overwhelming attack which might well have overrun the nearby aid station.

"There are two ways to come home, stepping off the plane and being carried off the plane," Sgt. Smith had written in an unsent email to his parents. "It doesn't matter how I come home, because I am prepared to give all that I am to insure that all my boys make it home." He had been the only American killed in the courtyard fight.

On April 4, 2005, exactly two years after his selfless action, his wife and their children David and Jessica stood in the White House as President Bush presented them the nation's highest decoration for bravery, the Medal of Honor. It was the first awarded in the Iraq War. Paul Ray Smith had indelibly marked his "common name" on history's small bright roll of those forever remembered for their uncommon valor.

Mr. Bennett writes the "American Heroes" series for the American Security Council.

American Resolve Versus the Media Polls
The reason was that almost all realized that the 9/11 attacks have changed the way most Americans see the world and their own place in it. Running away from Saigon, the Iranian desert, Beirut, Safwan and Mogadishu was not hard to sell to the average American, because he was sure that the story would end there; the enemies left behind would not pursue their campaign within the U.S. itself. The enemies that America is now facing in the jihadist archipelago, however, are dedicated to the destruction of the U.S. as the world knows it today. Those who have based their strategy on waiting Mr. Bush out may find to their cost that they have, once again, misread not only American politics but the realities of a world far more complex than it was even a decade ago. Mr. Bush may be a uniquely decisive, some might say reckless, leader. But a visitor to the U.S. soon finds out that he represents the American mood much more than the polls suggest.
"'The Last Helicopter'," by Amir Taheri, The Wall Street Journal, March 29, 2006; Page A18 --- Click Here

From the Federal Trade Commission
American's Top 10 Dot Cons ---

Link to Internet Auctions Link to International Modem Dialing
Link to Internet Access Services Link to Credit Card Fraud
Link to Web Cramming Link to Multilevel Marketing/Pyramids
Link to Travel and Vacation Link to Business Opporunities
Link to Investments Link to Health Care Products and Services

Bob Jensen's threads on consumer and credit card frauds are at

What can you do to prevent being taken on eBay?
(Word of Caution:  Never open an email message that pretends to be from Pay-Pal)

To which "Kate" replied: "That's true, indeed. I just scammed you, sorry for that, it's nothing personal. ... It's what I do, and it pays well." How did Smith get into this mess? The way any confidence-game victim does - by letting an overabundance of trust overwhelm ordinary caution.
Jeffe Gelles, "Psssst ... wanna buy a wedding dress?" The News-Sentinel,

Two brothers have published a book of "true tales of treachery, lies and fraud" from eBay. "Dawn of the eBay Deadbeats" contains stories written by eBay buyers and sellers. From stories of disappointing purchases to out-and-out fraud, the book is a manual of what can go wrong when buying and selling on auction sites. Brothers Stephen and Edward Klink co-wrote the book, illustrated by Clay Butler. The idea for the book sprung from a website Stephen Klink had created. A New Jersey police office, he founded - a site that aims to help people avoid auction scams - after he himself was ripped off online.
Ina Steiner, "Dawn of the eBay Deadbeats: New Book Uncovers Online Auction Treachery,",  December 28, 2005 ---


"Beware of eBay deadbeats, author warns," PhysOrg, March 1, 2006 ---

Imagine buying vintage Spiderman comics for $16,000 and receiving instead, a box of printer paper or losing a whopping $27,000 in purchasing a big rig that didn't exist in the first place. These are just many of the online auction fraud horror stories that brothers Edward and Steve Klink compiled from their eBay watchdog Web site (E.T.S.).

In their book "Dawn of the eBay Deadbeats," some 70 strange-but-true stories were collected and retold with the help of illustrator Clay Butler.

The December 2005 publishing of the book comes just in time as the online auction giant has been criticized by consumer groups, most recently by the U.K. magazine "Computing Which?" for its passive and sometimes delayed approach in handling fraud reports.

At any given time, the site has 78 million listings, and 6 million new listings are added each day.

And while, eBay maintains that less than .01 percent of all listings end in a confirmed case of fraud, that could mean that of the 1.9 billion listings reported by eBay in 2005, that 190,000 cases were confirmed frauds in the last year.

Currently there are almost 900 horror stories from eBay fraud victims are on the E.T.S. site whose motto is "Winning the war on deadbeats."

And already the brothers are working on the next volume of horror stories, encouraging victims who want to get their tales to be told to get into contact with them.

United Press International spoke with Edward Klink about the recent book, their watchdog
Web site, and the current state of eBay.

"We had collected hundreds of stories
on the Web site and figured it was time to take these stories to a wider audience and let the victims have their say," Edward Klink said. "Plus with our combined backgrounds, Steve is a police officer and I'm a business writer, we felt we were ideally suited to get the job done."

Fraud on eBay can take on many forms including items paid for that vary from the description in the sale, unpaid items, and spoof eBay or Pay-Pal e-mails.

And like the many victims on their site, the brothers too have encountered the problem of auction fraud.

In 2003, Steve, a New Jersey police officer, won a set of "new" speakers, only to find that it looked as if they were "gnawed on by a wild animal."

"The seller said they weren't that way when mailed, and eBay said there was nothing they could do," Klink said. "Annoyed that he was stuck with the merchandise and given no recourse, Steve started and stories began pouring in from around the world."

And the site has received a positive response since it's been up and running.

"People love it," Klink said. "On eBay, their official boards are closely monitored and talk about problems and scams and eBay's failings are not generally tolerated. So E.T.S. gives them an outlet. When it first came out was featured on and newspapers as far away as South Africa."

According to Klink, while eBay has what could be considered --"the ultimate
business model" -- of collecting fees and delegating the marketing, selling, packaging, shipping, and customer service to eBay users, it's very easy for these same users to fall victim to fraud.

"I think consumers let their guard down when they are sitting at home and surfing the Web with their coffee," he said. "If a stranger offered them a $1,400 antique vase on the street they'd most likely walk away, but when that same vase is on
the Internet for some reason the reaction is more, 'Say, now that looks interesting.'"

And have the brothers seen any improvements in eBay's handling of the fraud issue?

"eBay says it is a tiny fraction of all auctions," Klink said, "but the hundreds of people who told us their stories hate being in that tiny group and never thought they would be. Lots of fraud is underreported, too. EBay encourages users to settle it among themselves, and if they can't, then they are directed to pay $20.00 to have SquareTrade, a third party, mediate the dispute. But it's not often a scammer shows up for mediation!"

. . .

"We want people on eBay to have a good buying and selling experience - transparent, well-lit, and safe," the spokesperson said. "Fraud on all levels is something we take seriously."

The company also has a team dedicated to working with law enforcement rather it be educating them on fraudulent cases and working proactively taking information on specific cases to them or cooperating with investigations.

"We would invite anyone to visit the site and read more," said the spokesperson, who also emphasized that the no. 1 issue for online shoppers is to pay safely using Pay-Pal or a credit card than any other form of payment.

In many cases, consumers are able to get their money back, Pay-Pal offers up to $1,000 back with buyer protection and credit card programs usually have a pay back program in cases of fraud. In many cases, Pay-Pal offers a way for consumers to make purchases without providing personal information and at the same time protecting money.

"Dawn of the eBay Deadbeats" ($12.95) is available on Amazon, eBay, and in select bookstores.

Bob Jensen's threads on consumer and credit card frauds are at

March 3, 2006 message from Carolyn Kotlas []


"Like all learners, new online instructors need hands-on experience, feedback, and ongoing support to become comfortable and proficient in the virtual classroom. It is unrealistic to expect even the most self-motivated, creatively pedagogical, and technically inclined instructor to fly solo after just a few hours of training." In "Uniting Technology and Pedagogy: The Evolution of an Online Teaching Certification Course" (EDUCAUSE QUARTERLY, vol. 29, no. 1, 2006), Bonnie Riedinger and Paul Rosenberg explain how and why a certification course for online teaching was moved out of the classroom and into an online environment. The authors note from this experience that the online environment presents an "opportunity for instructors to examine their pedagogical habits." The complete article is available online at .

EDUCAUSE Quarterly, The IT Practitioner's Journal [ISSN 1528-5324] is published by EDUCAUSE, 4772 Walnut Street, Suite 206, Boulder, CO 80301-2538 USA. Current and past issues are available online at .

See also:

"The Myth about Online Course Development: 'A Faculty Member Can Individually Develop and Deliver an Effective Online Course'" by Diana G. Oblinger and Brian L. Hawkins EDUCAUSE REVIEW, vol. 41, no. 1, January/February 2006 



For tips on how to make your students' laptop computers part of their learning activities, see "14 Good Ideas from Liesel Knaack for Using Laptops in the Classroom" (SIDEBARS, January 2006). Knaack is a professor at the University of Ontario Institute of Technology where every student gets an IBM Thinkpad on their first day of class to use throughout their studies at the University. The article is online at .

SideBars [ISSN 1718-3685] is published by the Learning Resources Unit of the British Columbia Institute of Technology [ ]. "Founded in December 2001, SideBars provides useful information and news items for instructors, course developers, educational technologists, and anyone else who has an interest in distributed learning in its various manifestations." Current and back issues are available at . Email subscriptions are available at no cost at .



In January the University of Michigan Scholarly Publishing Office launched a refereed online journal, PLAGIARY. The purpose of the journal is "to bring together the various strands of scholarship which already exist on the subject, and to create a forum for discussion across disciplinary boundaries." Papers in the first issues include:

-- "The Google Library Project: Both Sides of the Story"

-- "Copy This! A Historical Perspective On the Use of the Photocopier in Art"

-- "A Million Little Pieces of Shame"

Plagiary: Cross-Disciplinary Studies in Plagiarism, Fabrication, and Falsification [ISSN 1559-3096] is available free of charge as an Open Access journal on the Internet at . For more information contact: John P. Lesko, Editor, Department of English, Saginaw Valley State University, University Center, MI 48710 USA; tel: 989-964-2067; fax: 989-790-7638; email: 

Bob Jensen's threads on plagiarism are at



Since Infobits reaches subscribers all over the world, we welcome information about resources in other languages besides English. This month, we present these:

USE  "USE: Usability Engineering fur E-Learning" is an online document produced by the Hamburg University of Applied Sciences Department of Information. The document, written in German, shows how to involve students when planning and designing an e-learning website.

STICEF  "STICEF: Sciences and Technologies Information and Communication for Education and Training" presents research "undertaken in the field of communication and information technologies in the service of human training." Papers are in French, but English abstracts are available. Recent papers include:

-- "Reusing Available (educational) Software developed by CAL (Computer Assisted Learning) Researchers?"

-- "Effet d'un feedback informatif sur la prise de notes dans un environnement d'apprentissage informatise'"

Editor's note: Machine translation certainly has its limitations; however, in order to decide if the text is relevant to your needs, sometimes you need a "quick and dirty" translation of a web page into your preferred language. In these cases, try Google's translation tools at . A 2005 evaluation of machine translation systems conducted by the US National Institute of Standards and Technology (NIST) rated Google's tool best overall. The NIST report is online at .

For more on machine translation see Seb Schmoller's June 2005 FORTNIGHTLY MAILING article, "Combining human with machine translation."


On the Leading Edge of Learning and Education Technology
Sharing Professor of the Week --- Dan Madigan at Bowling Green State University ---

Dan Madigan is the Director of the Scholarship and Engagement and Professor of English at Bowling Green State University.

Dan has a newsletter on Teaching Tips (usually with respect to technology) and other helpful teaching resources ---

I discovered Dan Madigan in the February 2006 issue of Accounting Education News ---
In that issue of AEN, a summary of provided of his Idea Paper #43 on "New Technologies that are Shaping Education and Learning." Excerpts from that summary are provided below.

Idea Paper #43 by Dan Madigan

New Technologies that are Shaping Teaching and Learning


You can create your own blog for free by going to .  Blog technology allows blogs to be syndicated and aggregators allow users to automatically search for favorite blogs on the web and have them delivered to personal accounts ( ) [using tools like RSS feed readers-Really Simple Syndication or Rich Site Summary].


There are many places on the web that offer wiki support for free wiki including: .  To find out more about wikis and how they can be used for teaching and learning go to .

 Learning Management Systems

Many universities buy a proprietary LMS, but increasingly universities are building their own LMS based on open source software like Moodle ( ).  Moodle's no-cost (excluding costs associated with hardware and support), flexibility to adapt to small or large institutions, departments, programs and individuals, and world-wide support are attractive features.

Presentation Software

Although PowerPoint® may be the most common example of this program, there are many other programs including Keynote, Adobe Acrobat, and the popular and free Open Office Suite package that includes IMPRESS as its presentation program ( ).  Simple presentations can also be created using the Simple Standards-Based Slide Show System (S5).  This open source system ( ) requires only basic knowledge of web skills and can be learned quickly.


A basic tutorial can be created with any text editor and delivered to students through a variety of digital technologies such as email, Portable Document Files (PDF) that can preserve the format and colors of a document, web pages, and CDs.  Tutorials that appeal to visual learners can be created with scanning software or basic screen capture software found on any operating system.  Video tutorials, like those for software applications, can be created with screen capturing software that captures the movement of a mouse as it is used to open windows and select options in a program.  A microphone, used simultaneously with the screen-capturing tool to narrate the actions and video-editing software, completes the process.  More advanced tutorials include functions that, for example, mimic teacher/student interactions and exchanges, and include an assessment of those interactions.  These interactive tutorials can be created through advanced programs such as Adobe FLASH and java scripting.

Concept Mapping Software

Description: Concept mapping (a method of brainstorming) is a technique for visualizing the relationships between concepts and creating a visual image to represent the relationship.  Concept mapping software serves several purposes in the educational environment.  One is to capture the conceptual thinking of one or more persons in a way that is visually represented.  Another is to represent the structure of knowledge gleaned from written documents so that such knowledge can be visually represented.  In essence, a concept map is a diagram showing relationships, often between complex ideas.  With new mapping software such as the open source Cmap ( ), concepts are easily represented with images (bubbles or pictures) called concept nodes, and are connected with lines that show the relationship between and among the concepts.  In addition, the software allows users to attach documents, diagrams, images other concept maps, hypertextual links and even media files to the concept nodes.  Concept maps can be saved as a PDF or image file and distributed electronically in a variety of ways including the Internet and storage devices.


These live sessions are highly interactive and allow users to share applications, such as whiteboards, concept maps and word documents, and to communicate live through audio and chat.  Elluminate ( ) is one of many server-based software programs that is enjoying popularity in educational settings.  Webcasts provide educational institutions with the ability to support conferencing and to deliver training and presentations to personnel anytime and anywhere.  Recorded and archived webcasts, because they are economical to develop and store, are increasingly becoming the preferred way for universities to deliver lectures, events and presentations to faculty and students through the web, CDs, DVDs and even TV broadcasts.


Some popular free podcatcher websites are iTunes and iPodder.  The browser Firefox also has podcatching features.  Users can create their own podcast for free by going to websites such as ( ).  For a nominal fee, a more powerful and cross-platform podcast creator tool can be found at ( ).


Although many standard software programs can be used to create basic ePortfolios, the most dynamic programs, such as Open Source Portfolio ( ) are designed specifically for developing portfolios that serve a variety of reflective and representational functions within a password protected system.

Personal Response Systems (Clickers)

Individuals are equipped with their own remote control keypads that have letters or numbers that correspond to choices given by a presenter.  The results of the responses are captured on a computer either through infrared or radio signals and compiled in ways that show such breakdowns as class distribution and individual responses.  Typically, the results are instantly made available to the participants via some type of graphic that is displayed with a projector.  Presenters can set automatic controls within the system that limit the time a responder has to answer a question.  Each remote "clicker" has a serial number so that all users and their responses can be individually identified and recorded.


Supporting Digital Technology for Teaching and Learning

As faculty are carefully assessing their use of technology for purposes of teaching and learning, universities need to assess whether their technology support is adequate and responsive to the needs of those instructors.  During the early phases of the digital revolution on campuses, this meant building an infrastructure, providing equipment and offering basic skills-oriented workshops to faculty and students.  Over the years, however, we have learned that basic technology support has not always been enough to ensure that digital technologies are being used effectively as ways to enhance student learning.  Some universities have heeded the challenge and are creatively building upon existing programs to develop a technology of support that is responsive to the professional lives of today's faculty.  What follows are five examples that serve to represent ways that universities are developing creative solutions for supporting a learning environment that is increasingly being influenced by a digital revolution that show no signs of abating anytime soon.

Faculty Involvement

Faculty need to have a critical voice in university decisions about technology improvement and deployment on campus--especially when the technology relates to teaching and learning issues...Forward thinking universities find new and inclusive ways to tap into the collective voice so that student learning and new technologies can be effectively aligned.

Blended Workshops

Forward thinking universities go beyond skills-based technology workshops.  They have found creative ways to blend pedagogical instruction with technology instruction...Also, universities have begun to offer blended workshops that have a distinct pedagogical focus yet blend in thinking about resources, including technology resources, which can support a strong pedagogical focus...

Threaded Workshops

Universities are using the threaded workshop model as a framework for teaching and learning workshops that include learning about new technologies.  Each workshop in the series is "threaded" in such a way as to relate to one another and play off of one another.  Thus, a series on integrated course design might have individual workshops on different topics like assessment, learning activities, motivation, and learning outcomes that are aligned in a way that gives participants a more comprehensive view of how to build a dynamic course.  All discussions about technology in these threaded workshops are contextualized within the larger pedagogical discussion, and are focused on how the technology serves to support the pedagogy.  Because instructors attend the series over a period of several weeks, they bring back to each workshop their applied knowledge and share it with one another as real world and relevant experiences...

Just-In-Time Resources

Universities are increasingly realizing that busy instructors do not need to be experts in all areas of digital technology in order to use technology effectively in the classroom.  Universities support this notion by making technology learning easy, accessible, and just-in-time.  Today's digital technology allows just-in-time resources to flourish on campus.  For example, Internet available tutorials that are home grown or licensed ( ) make it easy for instructors to learn new software/hardware in bits and pieces and when needed.  Why learn everything there is to know about PowerPoint or your computer operating system when you can learn only what you need by going to a two-minute video that is available anywhere and anytime.  In addition, just-in-time resources extend the learning environments of students.  Why spend valuable class time teaching students how to use a certain technology application for a project or activity when just-in-time resources can be made available to students at their level and at a time outside of class time?

Open Source

Some of the more popular open source software programs include: Moodle ( ) and Bazaar ( ), two LMS programs: MySQL ( ), a data base program, and; Open Office ( ), a productivity suite that supports word processing, spreadsheet, and presentation applications.  Many open source products can be found and downloaded at SourceForge ( ).


Universities are home to a rich diversity of student learners whose cultures have been tremendously impacted by the digital revolution of the last fifteen years.  These students grew up communicating, creating knowledge, and sharing resources through the Internet and all its applications.  As university students, they are poised to take advantage of the digital world for learning.  But are we as teachers?  We should not jump headfirst  into this potential digital cauldron without taking stock of an important detail--as with all technologies and instructional practices, we must not only understand their potential to impact deeper learning in students, we must also understand their limitations as a means to achieve a deeper learning.  It is not the lecture, cooperative learning or the problem-based method itself that enhances student learning any more than it is the Internet, podcast, or blog.  It is far more important to know how to use instructional methods and technology to support learning outcomes that are integrally linked to the student learner as a critical thinker.  Students may know how to navigate the Internet and use other forms of digital technology for purposes of their own learning, but do they know how to take full advantage of those technologies for learning at the university level?  This is where progressive universities enter the equation and lead.

In today's educational climate of decreasing state support and public scrutiny of educational spending, universities can ill afford to squander important dollars on technology resources that have not been critically assessed in terms of supporting student learning.  But, universities cannot stop there.  Faculty and administrators must combine efforts to celebrate openly the important symbiosis between technology and learning.  Nothing less will suffice or we will suffer from our own negligence.

The above quotes are only isolated quotes from a much longer document.


March 30, 2006 reply from David Albrecht [albrecht@PROFALBRECHT.COM]

Dan is an exceptional person and has had much influence how I go about my teaching assignments. He, for instance, taught me about the learning centered classroom. This took place when he was directing our CTLT (Center for Teaching & Learning using Technology). He did such a great job that he got promoted.

Dave Albrecht

Emerging Learning Technologies on the Ohio Learning Network ---

Bob Jensen's threads on education technologies are at

Tools of Education Technology ---

"The US has regained top position in the 2005 information technology rankings compiled by the World Economic Forum after slipping to fifth place in 2004," Frances Williams, Financial Times, March 28, 2006 ---,s01=1.html

Big Tax Return Preparer is Watching You:  Yet another incentive to do your own tax returns
The person who prepares your tax return may sell your private information
(Repeated from March 31 edition of New Bookmarks)

This link was forwarded by Scott Bonacker [cpa@BONACKERS.COM]
"IRS plans to allow preparers to sell data:  Critics said the proposed regulation could lead to a loss of privacy for clients," by Jeff Gelles, Philadelphia Inquirer, March 21, 2006 --- Click Here

The IRS is quietly moving to loosen the once-inviolable privacy of federal income-tax returns. If it succeeds, accountants and other tax-return preparers will be able to sell information from individual returns - or even entire returns - to marketers and data brokers.

The change is raising alarm among consumer and privacy-rights advocates. It was included in a set of proposed rules that the Treasury Department and the IRS published in the Dec. 8 Federal Register, where the official notice labeled them "not a significant regulatory action."

IRS officials portray the changes as housecleaning to update outmoded regulations adopted before it began accepting returns electronically. The proposed rules, which would become effective 30 days after a final version is published, would require a tax preparer to obtain written consent before selling tax information.

Critics call the changes a dangerous breach in personal and financial privacy. They say the requirement for signed consent would prove meaningless for many taxpayers, especially those hurriedly reviewing stacks of documents before a filing deadline.

"The normal interaction is that the taxpayer just signs what the tax preparer puts in front of them," said Jean Ann Fox of the Consumer Federation of America, one of several groups fighting the changes. "They think, 'This person is a tax professional, and I'm going to rely on them.' "

Criticism also came from U.S. Sen. Barack Obama (D., Ill.). In a letter last Tuesday to IRS Commissioner Mark Everson, Obama warned that once in the hands of third parties, tax information could be resold and handled under even looser rules than the IRS sets, increasing consumers' vulnerability to identity theft and other risks.

"There is no more sensitive information than a taxpayer's return, and the IRS's proposal to allow these returns to be sold to third-party marketers and database brokers is deeply troubling," Obama wrote.

The IRS first announced the proposal in a news release the day before the official notice was published, headlined: "IRS Issues Proposed Regulations to Safeguard Taxpayer Information."

The announcement did not mention potential sales of tax information. It said the proposed rules were guided by the principle "that tax return preparers may not disclose or use tax return information for purposes other than tax return preparation without the knowing, informed and voluntary consent of the taxpayer."

IRS spokesman William M. Cressman defended the proposal in similar terms.

"The heart of this proposed regulation is about the right of taxpayers to control their tax return information. The idea is to emphasize taxpayer consent and set clear boundaries on how tax return preparers can use or disclose tax return information," Cressman said in an e-mail response to questions.

Cressman said he was unable to explain "why this issue has come up at this time other than our effort to update regulations that date back to the 1970s and predate the electronic era."

Not all the changes have drawn opposition.

Beth A. McConnell, director of the Pennsylvania Public Interest Research Group (PennPIRG), said she welcomed a requirement that a taxpayer would need to consent to overseas processing of any portion of a tax return.

"That's a positive development, but I don't think it's worth giving up our tax returns' privacy for," said McConnell, who plans to testify on behalf of the U.S. Public Interest Research Group at an April 4 IRS hearing in Washington on the rule changes.

McConnell accused the IRS of using the new limit on overseas processing to dress up changes that would chiefly benefit tax preparers, marketers and data brokers.

"That's a disturbing trend among Washington officials lately," McConnell said. "They'll offer a modest consumer protection in one area in exchange for dramatic weakening of consumer protections in another area, and then try to convince the public that it's all in our interests."

Critics of the proposal said it could do more than open up sales of tax information to data brokers and marketers, because it could undermine taxpayer confidence in the entire tax system.

"Privacy protections for tax information are especially critical given the largely voluntary nature of the U.S. tax system," said Chi Chi Wu, a tax-law specialist at Boston's National Consumer Law Center.

Wu and other critics said they were uncertain who or what was behind the proposed changes in IRS privacy rules, which currently prohibit tax preparers from selling returns to third parties for marketing purposes, and require written consent if they want to use it for marketing by companies under their own corporate umbrella.

Officials at H&R Block and Jackson-Hewitt, two of the nation's largest tax-preparation firms, did not respond to requests for comment. Cressman said the IRS had so far received only about a dozen comments on the proposal.

"I think this just flew under the radar screen for so many people," McConnell said.

Continued in article

"IRS Plans to Allow Preparers to Sell Data," SmartPros, March 22, 2006 ---

The IRS is quietly moving to loosen the once-inviolable privacy of federal income-tax returns. If it succeeds, accountants and other tax-return preparers will be able to sell information from individual returns - or even entire returns - to marketers and data brokers.

The change is raising alarm among consumer and privacy-rights advocates. It was included in a set of proposed rules that the Treasury Department and the IRS published in the Dec. 8 Federal Register, where the official notice labeled them "not a significant regulatory action."

IRS officials portray the changes as housecleaning to update outmoded regulations adopted before it began accepting returns electronically. The proposed rules, which would become effective 30 days after a final version is published, would require a tax preparer to obtain written consent before selling tax information.

Critics call the changes a dangerous breach in personal and financial privacy. They say the requirement for signed consent would prove meaningless for many taxpayers, especially those hurriedly reviewing stacks of documents before a filing deadline.

"The normal interaction is that the taxpayer just signs what the tax preparer puts in front of them," said Jean Ann Fox of the Consumer Federation of America, one of several groups fighting the changes. "They think, 'This person is a tax professional, and I'm going to rely on them.' "

Criticism also came from U.S. Sen. Barack Obama (D., Ill.). In a letter last Tuesday to IRS Commissioner Mark Everson, Obama warned that once in the hands of third parties, tax information could be resold and handled under even looser rules than the IRS sets, increasing consumers' vulnerability to identity theft and other risks.

"There is no more sensitive information than a taxpayer's return, and the IRS's proposal to allow these returns to be sold to third-party marketers and database brokers is deeply troubling," Obama wrote.

The IRS first announced the proposal in a news release the day before the official notice was published, headlined: "IRS Issues Proposed Regulations to Safeguard Taxpayer Information."

The announcement did not mention potential sales of tax information. It said the proposed rules were guided by the principle "that tax return preparers may not disclose or use tax return information for purposes other than tax return preparation without the knowing, informed and voluntary consent of the taxpayer."  

"How to Google: 10 Tricks and Timesavers," SmartPros, March 2006 ---

Conduct a simple search. Some basic tips are included here along with recently added search features. These tips refer to the search box on Google's homepage.
  • Quotations. Put quotation marks around the phrase: "SEC study". Don't worry about capitalization: "sec sTuDy" will return the same results as "SEC study"
  • Tracking. Need to track your shipment from a major shipping company like UPS or USPS? Simply type in the tracking number in the search box. Do the same for tracking a flight: enter the airline followed by the flight number.
  • Dictionary. Find the definition of a word by typing define: ethics
  • Calculator. That's right. Type in a math problem and Google will spit out the answer. Try this: (256-96)/96
  • Directions/Maps. Many Web sites offer maps and driving directions. Now Google does too. Type in an address in the box and the results will return a street map and a satellite image. From here, type in from/to driving directions.

Explore "more." From the Google homepage, click on "More" and you're in Google heaven.

  • Toolbar. If you use Google often, download the Google toolbar to your Web browser. Not only do you have instant Google access, you can block pop-ups and auto fill your personal information into Web forms.
  • News. With Google News, access news stories from a myriad of sources, from The New York Times to Christian Science Monitor to PC World. When you search in Google News, you get results of how that word or phrase appeared in periodicals within the last 30 days. This feature saves you from having to visit several different news sites for the same story or topic. Give it a test run by typing in FASB.
  • Local. Find local businesses and services with a map pointing to the exact physical position. Traveling to Seattle for a conference and need to find the nearest Westin hotel? Type in Seattle Westin.
  • Special Searches. When looking for a specific government document, search .gov Web sites only. Other special search options include Public Service Search, University Search, and Microsoft Search.
  • Alerts. Are you following a particular company in the news? Customize an Alert and you'll be notified via email when Google finds that topic. A practical application would be to monitor your company, industry, or competitors.

This is just a small helping of what Google has to offer. In addition to cool search capabilities, Google has email, a photo editor, satellite imaging, a Web blog tool, a language translator, instant messaging, and a mobile-device tool (all free). To further your Google knowledge, don't miss the Help page, which provides tips for basic and advanced searching.

Happy googling!

NIQUETTE KELCHER is the Web Managing Editor for SmartPros Ltd.


Political Bias in Undergraduate Education

In this month's Carnegie Perspectives, Tom Ehrlich and Anne Colby revisit the highly politicized Academic Bill of Rights legislation. Tom and Anne lead the Foundation's work on the importance of civic and political engagement among undergraduate students. In this piece, they argue for the necessity for college faculty members to become much more self-conscious of the variety of ways in which they communicate their political and social views to students. They provide recommendations and precautions for campus leaders who seek to create opportunities for teaching and inquiry that will encourage student learning around difficult issues.
Lee S. Shulman, President The Carnegie Foundation for the Advancement of Teaching, March 29, 2006 ---

Bob Jensen's threads on Higher Education Controversies are at

What may be some of the direct and indirect commodification implications for you and your college under various new legislation and pending legislation in Washington DC?
Hint: Under the bill, colleges can no longer be able to turn down credits solely based on a school's source of accreditation.

"Higher-Education Bill Aims to Stir Up Academia," by John Hechinger, The Wall Street Journal, March 30, 2006; Page A8 --- Click Here

Republicans are "opening up a tremendous number of provisions for the for-profits," says Ms. Flanagan. "Those are the ones with a seat at the table. The rest of us have been left out."

Congress recently handed for-profit schools a big win when it eliminated a rule requiring all colleges to offer at least half of their instruction in brick-and-mortar classrooms to be eligible for federal financial aid. The restriction, intended to prevent fraud, had hindered online education programs that are especially popular offerings among education companies.

A provision in the latest bill would weaken another requirement -- that schools receive no more than 90% of their revenue from federal financial aid. The rule was intended to prevent a repeat of widespread fraud in the 1980s and early 1990s, when some trade schools signed up unqualified low-income students in order to collect federal aid. For-profit schools are most likely to bump up against the 90% limit because they lack other funding sources and often cater to low-income students. Schools would now have more time to get back in line with the rule if they fall short.

Yet another measure would put for-profits more on equal academic footing with established schools. Traditional schools have long tended to reject degrees and course credits from students at for-profit schools, which often lack the imprimatur of long-established regional accrediting agencies. Under the bill, they would no longer be able to turn down credits solely based on a school's source of accreditation.

Jensen Comment
This legislation can have far-reaching impacts on faculty. It will open employment opportunities in for-profit colleges.  But it will also increase competition, especially in graduate professional programs in business, law, pharmacy, nursing, etc. I think it will also greatly increase the danger of fraud.

What is the meaning of “commodification” in education today?
When asked to list the top 10 problems facing the academy today, I bet most professors would include the “commodification” of education. By that they mean a sort of creeping penetration of market-forces into the academy such that earning a B.A. is becoming increasingly indistinguishable from, say, buying a Camaro. As an adjunct I am not privy to the way this trend has altered the wider institutional structure of higher education, beyond noticing that that very little of the tuition my students pay finds its way back to me. However, as someone who regularly teaches service courses I have extensive experience with bread and butter teaching, and I am familiar with what “commodification” is supposed to mean in this context: the idea that professors are expected to produce “customer satisfaction” in their students, and students are supposed to actually “enjoy” the classes they take.
Alex Golub, "The Professor as Personal Trainer," Inside Higher Ed, October 24, 2005 ---

March 30, 2005 reply from David Fordham, James Madison University [fordhadr@JMU.EDU]

In a very rare turn of events, I find myself in total 100% agreement with Bob's speculation on this one. In reply to Glen's response, I'm not sure the federal employees had as much to do with this bill as lobbyists. Congress is generally more attuned to the needs of lobbyists than it is to federal employees.

And as Bob points out, this smacks not only of lobbyists, but good old fashioned planking politics, knee-jerk politics.

Okay, (yawn), so what else is new?

But what I'm really wondering is: Why we accounting professors -- of all people -- haven't been able to see the connection between the "calls for transparency in corporate reporting", and the "calls for accountability in higher education"?

Why don't we have transparency when it comes to judging the quality of a transcript? Why do we pay so much attention to accurate, transparent, and fair financial reporting of corporations, but so little attention to such qualities when it comes to transcript reporting?

Isn't education more important than mere money? (Okay, okay, I know the real answer, but we're *supposed* to be ACADEMICS, aren't we??)

What's good for the goose should be good for the gander, right? Take a close look at this concept.

We require companies to go to astoundingly complex, costly, gyrating, unimaginable effort to publicly report on the results of their operations. Why? So the public can openly compare quality between organizations, and thereby make good decisions. To support this public reporting, we have established an unbelievably-complex set of rules -- and then mandated adherence to them -- about how to create those annual reports. And then we require periodic audits to ensure "uniform" application across organizations to promote public confidence in the comparisons. We require certification of those who do the checking, too.

Why not apply the same principle to higher education? Isn't hiring an employee tantamount to making an investment? Shouldn't there be some way of comparing the quality of various individuals' transcripts, just as there is a way to compare stocks and bonds? Why don't we care about the quality of a transcript the way we do a stock certificate?

Why don't we propose a set of "generally accepted academic reporting principles" for the issuing organization (e.g., universities, colleges, diploma mills, etc.) and mandate adherence to these uniform reporting standards.

Oh, come on, sure, you can claim that education is more complex and multi-dimensional than simple cash flows and net income calculations. But hey, get serious -- have you looked at derivative or SPE or pension accounting lately? I rest my case.

And we already have the audit mechanism in place -- kinda -- (given our dean's worshipful obeisance to the AACSB). (footnote: can you imagine having the AACSB spend four weeks at your institution EVERY YEAR after the May commencement? Wow, what a thought! I wonder which junior is going to get stuck spending his weekend proofing the assessment figures!)

And talk about malfeasance and negligence! If the accrediting agencies were held to the same standards as financial auditors, just think of the job opportunities this would create for all those poor law-school students who might otherwise face an oversupply of lawyers in our economy in the coming years.

While I believe Congress is acting politically and irrationally (both as always), they are at least responding to a problem about bias in decision making relating to the quality of transcripts. They are responding to a changing market environment in transcripts. I'm not confident in the winners of popularity contests to come up with solutions to difficult problems. Can we as academics do any better?

My experience has been that just because a bricks-and-mortar school is accredited says very little about the quality of its education (inputs maybe, outputs no). And while there are many fraudulent on-line educational programs, my brother- in-law's experience teaching at such an institution (named after its home town in Arizona) would seem to indicate that with proper management, proper administration, proper mission definition, proper faculty hiring decisions, and proper execution (!), the concept can possibly result in as good an education as bricks-and-mortar.

But after all my devils-advocating at the fundamental level, I repeat, I agree with Bob. I see such a law as this creating far more problems than it solves.

And of course, my whole post here assumes the WSJ article got things right in the first place. My experience with WSJ reporting's quality leaves this assumption in grave doubt... We need transparency and accuracy of reporting in the media FAR FAR more than we need it in financial reporting or education or anything else, for that matter.

David Fordham

Actually David, I think the WSJ article got it right this time although without the details about the political fight described below by Doug Lederman.

"Partisanship Reigns," by Doug Lederman, Inside Higher Ed, March 30, 2006 ---

The rest of the rhetoric as lawmakers began work on the key piece of higher education legislation probably left many of those who watched it longing for a different era, or perhaps a different political system entirely. Republican and Democratic lawmakers mostly talked past each other, with Democrats accusing Republicans of shortchanging students in the bill and squelching debate by restricting the number of amendments to the measure, and Republicans charging Democrats with distorting the goals of the legislation and devolving into unnecessary partisanship.

In terms of actual legislating, very little got done Wednesday, in part because the House Rules Committee, which sets the terms of debates and voting for each piece of legislation, approved only 14, mostly minor amendments that could be offered on the House floor Wednesday.

Although Democrats complained that Republican leaders were purposely trying to limit their ability to try to alter the Higher Ed Act legislation — “shutting down this process,” Rep. Doris Matsui (D-Calif.) said – the Rules Committee, in a highly unusual move, met late into the night Wednesday to craft a second rule that cleared the way for 8 of the other 100 or so proposed amendments to be debated and voted on today.

Included among them are a sweeping Democratic “substitute” that takes different approaches to many of the issues in the bill — which faces near-certain defeat; a proposal to ease reporting requirements on college costs and strip language from the legislation that would allow states to begin accrediting colleges; another that would bar colleges from denying a student’s transferred academic credits based solely on the accreditation of the “sending” institution; and one that would require colleges that receive federal funds to submit an annual report about whether and how they take race into account in admissions.

The only amendment of real substance that was considered Wednesday was offered by Rep. Dan Burton (R-Ind.), and vigorously opposed by higher education groups. It sought to require colleges that receive funds through the Higher Education Act’s international education programs to report in a public database any donations they received from foreign sources.

While Burton and other supporters of the measure portrayed it as an anti-terrorism effort – a news release from Burton quoted David Horowitz as saying the amendment would prevent “the undue influence of foreign monies” – Burton also did not hide the fact that he was primarily targeting campus Middle East studies programs, some of which conservatives have accused of being hotbeds of Muslim radicalism.

“The underlying goal of the amendment is to draw attention to the anti-American, anti-Semitic, and anti-democratic rhetoric being preached at some college’s ‘Middle East Studies’ centers,” said the Burton news release, which featured a line at the top boasting that the “American Jewish Congress strongly supports disclosure.”

College groups lobbied hard against the Burton measure, and it was defeated soundly, by a vote of 306 to 120.

Continued in article

Bob Jensen's threads on controversies in higher education are at

Bob Jensen’s links to online global training and education alternatives are at


The Pending Collapse of the Western Economies

"Seven Pillars of Folly," by Edward Chancellor, The Wall Street Journal, March 8, 2006; Page A20 ---

The oil exporters of the Persian Gulf are flush with cash. Some of that money is going towards acquiring P&O, the British shipping concern, thus sparking off the heated controversy over foreign control of U.S. ports. This has led people to worry that Arab petrodollars might be scared away from the U.S. In fact, unlike during the last oil boom of the late 1970s, relatively little of the current Arab oil surplus has been directly invested in U.S. assets or even deposited in the international banking system. This time much of the oil money has remained at home where a classic speculative mania is now being played out.

Lawrence of Arabia took the title of his celebrated book from a passage in the Book of Proverbs: "Wisdom hath builded her house, she hath hewn out her seven pillars." In homage to Lawrence, we identify the seven pillars of folly upon which the Great Arab Boom has been weakly constructed.

• The first pillar is liquidity:
OPEC members have earned around $1.3 trillion in petrodollars since 1998, according to the Bank for International Settlements. The extra liquidity injected into the Gulf economies by the oil price hike since 2002 is estimated at around $300 billion by HSBC. Some of this money has been spent on building up foreign currency reserves and on the acquisition of foreign companies, such as P&O. Arab takeovers of European and U.S. firms totaled $30 billion last year. Some money has even been invested in hedge funds and gold. However, a great deal has stayed in the Gulf region.

This has contributed to an extraordinary explosion of bank credit in Saudi Arabia and its neighbors. Since the member countries of the Gulf Cooperation Council link their currencies to the U.S. dollar, they have also enjoyed the Federal Reserve's easy money policy. The Saudi government has recently repaid around $100 billion of outstanding debt, further contributing to domestic liquidity.

The deposit base of Gulf commercial banks has increased by over 60% since 2000, according to a recent report from Credit Suisse. Bank loans have financed business investment, personal consumption, property development and stock margin loans, thereby boosting both the economy and asset prices.

• The second pillar is the new economy:
The Gulf economies are growing rapidly, along with corporate profits. Returns on equity in the region are approaching 20%, calculates Credit Suisse. Saudi Arabia has recently joined the World Trade Organization. Kuwait is selling off some state-owned businesses. A new era of permanently high oil prices and perpetual prosperity has been hailed.

The Gulf rulers are seeking to reduce their economies' dependence on oil. This is spurring a massive investment boom. Dubai is attempting to transform itself into a leading financial center and tourist resort. Saudi Arabia intends to become a world leader in fertilizer production. A bridge costing $3 billion is proposed to span the Red Sea. A new economy is coming into being. The current oil boom, unlike former ones, won't be followed by a bust, say the believers. This time it's different.

• The third pillar is the stock market:
The recent performance of Arab stock markets makes the Nasdaq of the late 1990s look like a slouch. Since January 2002, the Egyptian, Dubai and Saudi stock markets are up respectively by over 1,100%, 630% and 600%. Only four years ago, Gulf companies were priced at around twice book value. Today they trade on an average of 44 times historic earnings and at over eight times book value. Gulf banks are valued at over nine times book value, according to Credit Suisse.

Sabic, a Saudi conglomerate, is currently ranked among the world's 10 largest companies by market capitalization. The Saudi stock exchange has a market cap of around $750 billion. That's roughly three times the country's GDP. By comparison, the U.S. stock market reached a peak of 183% of GDP in March 2000. In fact, the relative overvaluation of the Saudi stock market is even greater than these figures suggest. Nomura analyst Tarek Fadlallah points out that as the oil industry remains in state hands, a far smaller fraction of Saudi economic activity is captured by the stock market than in the U.S.

• The fourth pillar is an IPO boom:
In the late 1980s, the Japanese authorities kindled a speculative mania by floating telecom giant NTT. In unconscious imitation, the Gulf states have stimulated their mania with privatizations and IPOs at bargain prices. It is not unknown for stocks to climb 500% on the first day's trading. Applications for new issues have been oversubscribed by up to 800 times. One IPO in the United Arab Emirates attracted aggregate subscriptions greater than $100 billion, a larger sum than the UAE's GDP.

• The fifth pillar is a property boom:
Dubai is the fastest-growing city in the world. Hundreds of new buildings are under construction, including what is planned to be the tallest building ever, the Burj Tower. Cynics point out that the capping of the world's highest property, from the Empire State Building to the Petronas Towers in Malaysia, has occasionally in the past coincided with economic crises. Reports suggest that the majority of new Dubai properties are being acquired for speculative purposes, with only small deposits put down. They are being flipped in the contemporary Miami manner.

• The sixth pillar is market inefficiency:
Financial information in the Gulf is totally inadequate. The Saudi megacap conglomerate Sabic attracts no domestic financial analysis, says Nomura's Mr. Fadlallah. Companies report their results in a rudimentary fashion. It is against the law to sell short overpriced stocks in the Saudi market. And foreigners' financial sophistication is absent since only Gulf nationals can purchase Saudi stocks. Instead, speculators operate in an information vacuum in markets reportedly dominated by insider trading and practiced manipulation.

• The seventh pillar is the madness of crowds:
Newspapers gleefully report stories of police called to protect banks from overeager IPO subscribers. A Saudi woman is said to have been divorced by her husband for no reason other than that he'd had lost money in the stock market. Up to two million of the 16 million Saudi population are said to be playing the market. Interest-free loans are commonly available. Saudi bank foyers are lined with LCD screens showing stock movements. A local TV station has started to provide stock market reports. The education minister has warned teachers to stop day-trading at schools. People are quitting their jobs to trade.

This is a familiar tale of folly, similar in certain aspects to the global technology bubble of the late 1990s. And like the tech bubble it is set to burst. The current Gulf prosperity is a mirage created by a haze of liquidity. The Federal Reserve, which inadvertently caused the Arab bubble when it slashed interest rates in 2002, is currently mopping up that liquidity. The Gulf Arabs are likely to be rudely awoken from their speculative dreams. In fact, the Arab markets are beginning to crack: Dubai has fallen 40% from its November peak, and the Saudi market is down by around 12% in the past few days.

There are several implications of the coming Arab crash. Speculative booms lead to capital being misallocated. Many of today's investments in the Gulf region may appear, in retrospect, as extravagant as U.S. fiber-optic expenditures in the late 1990s. As for Dubai's desire to become an international financial center, it is spookily reminiscent of Tokyo's ambition to rival New York and London in the 1980s. Japan's ambition was shattered by the collapse of its bubble economy.

The political consequences could be more serious. Arab rulers have deliberately encouraged the boom in the hope that rising asset prices and a strong economy would distract their youthful populations from religious fundamentalism. This strategy could backfire. History teaches that when speculative bubbles burst and the public loses large sums, there is normally a political backlash. This was true of the U.S. in the 1930s, and to a lesser extent in the early 2000s, and of Japan in the 1990s. It's not hard to imagine Islamists capitalizing on a future bust with denunciations of stock-market gambling. Some of today's young Arab day-traders could well turn into tomorrow's al Qaeda recruits.

Mr. Chancellor is deputy U.S. editor for

Bob Jensen unfinished essay on the "Pending Collapse of the United States" ---

Gore and Blood
We see a lot of snide remarks and jokes about Al Gore the conservative media, and he (like his counterpart George W. Bush) has made some rather dumb remarks in highly boring speeches. But when teamed up with the former head of Goldman Sachs Asset Management, Gore and Blood (not the best of last name combinations) produced a rather good, albeit short, article about some severe accounting limitations.

I commend The Wall Street Journal for carrying this piece which I would normally expect to appear in a more liberal media outlet.

"For People and Planet:  When will companies start accounting for environmental costs?" by Al gore and David Blood, The Wall Street Journal, March 28, 2006 --- 

Capitalism and sustainability are deeply and increasingly interrelated. After all, our economic activity is based on the use of natural and human resources. Not until we more broadly "price in" the external costs of investment decisions across all sectors will we have a sustainable economy and society.

The industrial revolution brought enormous prosperity, but it also introduced unsustainable business practices. Our current system for accounting was principally established in the 1930s by Lord Keynes and the creation of "national accounts" (the backbone of today's gross domestic product). While this system was precise in its ability to account for capital goods, it was imprecise in its ability to account for natural and human resources because it assumed them to be limitless. This, in part, explains why our current model of economic development is hard-wired to externalize as many costs as possible.

Externalities are costs created by industry but paid for by society. For example, pollution is an externality which is sometimes taxed by government in order to make the entity responsible "internalize" the full costs of production. Over the past century, companies have been rewarded financially for maximizing externalities in order to minimize costs.

Today, the global context for business is clearly changing. "Capitalism is at a crossroads," says Stuart Hart, professor of management at Cornell University. We agree, and we think the financial markets have a significant opportunity to chart the way forward. In fact, we believe that sustainable development will be the primary driver of industrial and economic change over the next 50 years. The interests of shareholders, over time, will be best served by companies that maximize their financial performance by strategically managing their economic, social, environmental and ethical performance. This is increasingly true as we confront the limits of our ecological system to hold up under current patterns of use. "License to operate" can no longer be taken for granted by business as challenges such as climate change, HIV/AIDS, water scarcity and poverty have reached a point where civil society is demanding a response from business and government. The "polluter pays" principle is just one example of how companies can be held accountable for the full costs of doing business. Now, more than ever, factors beyond the scope of Keynes's national accounts are directly affecting a company's ability to generate revenues, manage risks, and sustain competitive advantage. There are many examples of the growing acceptance of this view.

In the corporate sector, companies like General Electric are designing products to enable their clients to compete in a carbon-constrained world. Novo Nordisk is taking a holistic view of combating diabetes not only through treatment but also through prevention. And Whole Foods and others are addressing the demand for quality food by sourcing local and organic produce. Importantly, the business response is about making money for shareholders, not altruism.

In the nongovernmental sector, organizations such as World Resources Institute, Transparency International, the Coalition for Environmentally Responsible Economies (Ceres) and AccountAbility are helping companies explore how best to align corporate responsibility with business strategy.

Over the past five years we have seen markets begin to incorporate the external cost of carbon dioxide emissions. This is happening through pricing mechanisms (price per ton of carbon dioxide) and government-supported trading platforms such as the European Union Emissions Trading Scheme in Europe. Even without a regulatory framework in the U.S., voluntary markets are emerging, such as the Chicago Climate Exchange and state-level initiatives such as the Regional Greenhouse Gas Initiative. These market mechanisms increasingly enable companies to calculate project returns and capital expenditures decisions with the price of carbon dioxide fully integrated.

The investment community has also started to respond. For example, the Enhanced Analytics Initiative, an international collaboration between asset owners and managers, encourages investment research that considers the impact of extrafinancial issues on long-term company performance. The Equator Principles, designed to help financial institutions manage environmental and social risk in project financing, have now been adopted by 40 banks, which arrange over 75% of the world's project loans. In addition, the rise in shareholder activism and the growing debate on fiduciary responsibility, governance legislation and reporting requirements (such as the Global Reporting Initiative and the EU Business Review) indicate the mainstream incorporation of sustainability concerns. While we are seeing evidence of leading public companies adopting sustainable business practices in developed markets, there is still a long way to go to make sustainability fully integrated and therefore truly mainstream. A short-term focus still pervades both corporate and investment communities, which hinders long-term value creation.

As some have said, "We are operating the Earth like it's a business in liquidation." More mechanisms to incorporate environmental and social externalities will be needed to enable capital markets to achieve their intended purpose--to consistently allocate capital to its highest and best use for the good of the people and the planet.

Mr. Gore, a former vice president of the United States, is chairman of Generation Investment Management. Mr. Blood, formerly head of Goldman Sachs Asset Management, is managing partner of Generation Investment Management, which he co-founded with Mr. Gore.

"Kyoto? No Go. How to combat "global warming" without destroying the economy," by Pete Du Pont, The Wall Street Journal, March 28, 2006 --- 

Bob Jensen's threads on accounting theory and intangibles are at

"CED Releases Recommendations for Improving Corporate Governance," AccountingWeb, March 24, 2006 ---

The Committee for Economic Development (CED), a business-led public policy group, on Tuesday released a policy statement examining the state of corporate governance in the U.S. and offering practical recommendations for restoring public trust in business.

“The high-profile corporate scandals of the past few years, coupled with numerous problems regarding financial statements, have shaken shareholders’ trust in many businesses leaders and their companies,” Roderick M. Hills, co-chair of CED and chair of the CED Subcommittee on Corporate Governance, said in a prepared statement. “It is imperative that we take concrete steps to restore the practices and processes that are the foundation of good business ethics. Specifically, I believe that the auditing process must reflect responsibility by company leaders, not just a rigid adherence to accounting rules. The auditing process needs to be guided by an over-arching set of principles that guarantee that the CEO, Board of Directors, and other top company officials know that they are fully committed to providing a truly fair and clear presentation of the firm.” Hill is currently a partner at Hills, Stern and Morley.

CED’s recommendations include:

"Stanford Will Establish Center To Study Corporate Governance," by Rebecca Buckman, The Wall Street Journal, March 6, 2006; Page B2 ---

Stanford University is setting up a research center to focus on the emerging academic discipline of corporate governance, funded with $10 million from legendary Silicon Valley venture capitalist Arthur Rock and his wife.

The new institution at Stanford Law School will be led by law professors Robert Daines and Joseph Grundfest and will study issues such as executive pay, shareholder rights and the state of the auditing industry, the university said. Organizers hope the center will also be more hands-on, interacting with regulators and judges and creating teaching materials for business-school students.

"We don't want to be just an academic center," Mr. Grundfest said in an interview. "We also want to help improve the quality of corporate governance in the real world." He added that Stanford's law school has been active in the area since 1993, when it launched a program called Directors College to help educate corporate-board members.

Mr. Grundfest served as a commissioner with the Securities and Exchange Commission from 1985 to 1990. He will direct the center with Mr. Daines, a corporate-law scholar who once worked at investment bank Goldman Sachs Group Inc

Continued in article

Bob Jensen's threads on corporate governance are at

From Jim Mahar's Blog an March 29, 2006 ---

The Influence of Audit Committee Financial Expertise on Earnings Quality: US Evidence by Bo Qin

SSRN-The Influence of Audit Committee Financial Expertise on Earnings Quality: US Evidence by Bo Qin

More evidence that board make-up matters. In this peice, Qin finds that, having an

..accounting-literate professional as SEC initially proposed serving on the audit committee are more likely to have high quality of reported earnings than others without such an expert.

Interestingly the final definition of financial expert that was adopted by the SEC yielded a MUCH weaker finding so it appears that not only board make-up matters, but also definitions!

Cite: Qin, Bo, "The Influence of Audit Committee Financial Expertise on Earnings Quality: US Evidence" (March 2006).
Available at SSRN:

From  Jim Mahar's Blog on March 22, 2006 ---

A look at derivative trading before Black and Scholes.

In a forthcoming Journal of Finance piece, Moore and Juh examine how options were priced 60 years BEFORE the Black-Scholes formula. They find that when markets were competitive, the pricing errors were about the same that we find today!

Summary: Previous research on the efficiency of option pricing is mixed. This may be because of poor data (example monthly data) or actual mispricing.

In this paper, Moore and Juh use option data from South African markets (the article contains an interesting history of these gold-dominated markets as well!), and find that while investors sort of "got it" they did misprice some and that this mispricing seems tied to the degree of competition in the market.

Specifically it appears that investors overestimated volatilty somewhat. For instance from the section on option pricing:

"Of the 112 stocks in our data set, 84 had more than half of the options quoted on them overpriced relative to Black-Scholes model prices (including 18 stocks forwhich all options written were overpriced)...."

As a percentage, this mispricing seems to be tied to market competitivenes:

"Our results suggest that findings of option mispricing that rely on a broker’s quotes are quite sensitive to the competitiveness of the market in which the broker operated. It is possible that differing levels of competition in the option writing market can explain the divergent findings of Boness (1964), Kruizenga (1964), Black and Scholes (1972), and Kairys and Valerio (1997)." Of course in today's market we do not always get things correctly either and the authors compare the pricing errors of today with those of the earlier period. The finding? The errors are quite comparable. In the words of Moore and Juh:

"Comparing these warrants to derivatives trading between 2001 and 2003 on the same exchange and using the same methods to compute volatility, we find that early twentieth century investors mispriced in a comparable way using a historical measure of volatility and outperformed modern JSE investors using a perfect-foresight measure of volatility. Development of the modern theory does not appear to have improved the performance of South African investors." and equally important (maybe more so) after showing that the mispricing was a function of the degree of competitiveness in the market:

"...these results suggest that a competitive market, whether through trading of derivatives on an exchange or competition among rival brokers, has been more important in driving derivativeprices to fair values than the development of a formal derivative pricing model...."

Cool paper!


Derivative Pricing 60 Years before Black-Scholes: Evidence from the Johannesburg Stock Exchange by LYNDON MOORE and STEVE JUH. This review was based on a Northwestern University working paper.

 The version that is forthcoming in the JF is at

Bob Jensen has some threads on options pricing at

I have genuine doubts about the accuracy of online Black-Scholes options pricing calculators. See both Black-Scholes files at

Accelerated share repurchase (ASR) Manipulation of Earnings-Per-Share (EPS)

Games Corporations Play
What's special about ASRs is that the business firm simulates a normal repurchase program but enjoys an immediate EPS jump. The accounting rules seem to allow the entity instantly to reduce the number of shares outstanding.

"The Accounting Cycle How Wall Street Helps Managers Fudge EPS," by: J. Edward Ketz, SmartPros, March 2006 ---

Managers are smart enough to know that earnings per share (EPS) is the most important statistic found within a financial report. Since they are evaluated on the basis of financial performance and performance is gauged by EPS, business executives do a number on EPS. If you can't earn it legitimately and if you don't want to out-and-out make it up, do the next best thing. Just stretch the truth as far as you can and hope nobody finds out. Wash, rinse, and spin: that's their motto!

Accelerated share repurchase (ASR) programs are the new game in town. They involve derivative contracts on the business enterprise's own stock in an attempt to inflate EPS. Managers seek ways to reduce the denominator in EPS, and, for a fee, Wall Street is happy to oblige.

Not that derivatives on one's own stock are new. In the heyday of the late 1990s and early 2000s, firms would write put options or go long on forward contracts on their common stock. Neither instrument hedged anything; they were merely contracts that bet that their stock prices would climb over the life of the derivative. If they did, the company would gain the premium in the case of the written put options, for the buyers of these instruments would let the options lapse. In the case of the forward purchase contract, the corporation would buy back its own shares at old, cheaper prices. Alternatively, the participants in the forward contract could cash-settle the gain/loss on the forward.

These cute derivatives paid handsomely as long as the stock market cooperated by generating higher prices. As soon as the market turned south, the shareholders in these business enterprises discovered huge losses. Recall the saga of EDS, which engaged in both activities, writing put options and having forward purchase contracts. The stock price of EDS took a nosedive in 2001 and 2002, and the firm lost $225 million on their gamble.

Today those games have been replaced with the ASR racket. SFAS No. 150 has virtually eliminated the incentive for writing put options or engaging in forward purchase contracts on one's stock because it requires the firm to mark the instruments to market, placing gains and losses into the income statement. Until and unless the FASB amends SFAS No. 150 to do the same with ASRs, business entities can employ ASRs without marking them to market. Any gains or losses bypass the income statement and go into equity.

ASRs work like this. The counterparty, usually a financial institution, borrows the company's shares from investors and sells the stock short. The company purchases shares from the counterparty and simultaneously enters into a forward sale contract with the counterparty. Later the counterparty purchases shares in the open market to cover its short position. At maturity the forward contract is settled by selling the shares at the exercise price or by the net cash amount.

What's special about ASRs is that the business firm simulates a normal repurchase program but enjoys an immediate EPS jump. The accounting rules seem to allow the entity instantly to reduce the number of shares outstanding.

Managers in a variety of corporations have participated in ASRs, and they have accounted for them in the manner described. They include Cardinal Healthcare, Cendant, Duke Energy, Hewlett-Packard, and Waste Management. (Gee, haven't we seen these firms in recent news stories?)

The problem with ASRs is that it is all nonsense. The forward should be marked to market rather than bypassing the income statement. Moreover, while the firm has repurchased the common shares, it also has promised to sell them (or cash-settle) in the forward contract. In my mind the forward negates the repurchase aspect and so the denominator ought to stay the same. Instead of treating the two transactions separately, the corporation should account for them as joint set of transactions.

Why do these managers persist in exaggerating financial statements to improve their performance evaluation? Why don't they try to tell it like it was instead of telling it like they wanted it to be? Don't these managers care to tell investors and creditors the truth?

And why are investment bankers playing the huckster? They are playing with fire when they peddle these tricks to managers. Didn't they learn anything from the financial meltdown in 2001-2002? Weren't they humiliated by criminal investigations by the Justice Department? Didn't they lose enough money in the lawsuits they settled out of court, and aren't they bothered by the remaining lawsuits still in play? How many more criminal investigations and how many more civil suits do they wish to face? These games have to end -- if they endure, more financial implosions are in the forecast, hurting managers and investments bankers as well as investors and creditors.

Bob Jensen's Rotten to the Core threads are at

Bob Jensen's threads on accounting for derivatives are at

March 28, 2006 message from Denny Beresford [DBeresfo@TERRY.UGA.EDU]

A House of Representatives subcommittee is going to have a public hearing on Wednesday that has the objective of discussing "ways to promote more transparent financial reporting, including current initiatives by regulators and industry."

See the press release at:  for further details.

Denny Beresford

House Committee on Financial Services ---

Baker Subcommittee to Advocate Transparency in Financial Reporting

The Financial Services Subcommittee on Capital Markets, Insurance and Government Sponsored Enterprises, chaired by Rep. Richard H. Baker (LA), will convene for a hearing entitled Fostering Accuracy and Transparency in Financial Reporting. The hearing will take place on Wednesday, March 29 at 10 a.m. in room 2128 of the Rayburn building.

Members of the Subcommittee are expected to discuss ways to promote more transparent financial reporting, including current initiatives by regulators and industry.

For the capital markets to operate most efficiently, information about public companies must be understandable, accessible, and accurate. Corporate statements are mathematical summaries meant to convey a company’s condition. The four basic documents which must be filed with the U.S. Securities and Exchange Commission (SEC) are at the heart of investor disclosure: the income statement, the cash flow statement, the balance sheet, and the statement of changes in equity.

Among the current initiatives to improve the clarity and usefulness of public company information is a trend away from quarterly earnings forecasting, the use of technology to decrease complexity, and a review of the various accounting standards and how they interact.

Subcommittee Chairman Baker said, "If U.S. markets are to remain on top in an increasingly competitive global marketplace, we need to move away from the complex and cumbersome and explore technological and other methods of enhancing the clarity, accuracy, and efficiency of our accounting system. At the same time, we need to look at whether earnings forecasting and the beat-the-street mentality, which appears to have contributed to some of the executive malfeasance of the past several years, truly serves the best interest of investors or the goal of long-term economic growth."

The corporate scandals several years ago revealed weaknesses in the financial reporting system. While many companies were violating financial reporting requirements, regulatory complexity also may have contributed to some lapses in compliance.

Fraud, general manipulation of statements, and regulatory complexity all contribute to a reduction in the usefulness of financial statements and all may obfuscate the picture of companies’ financial health. A number of recent studies have argued against the practice of predicting future quarterly earnings, concluding that the drive to “make the numbers” can lead to poor business decisions and the manipulation of earnings.

Congress, regulators, and the industry subsequently have assessed financial reporting failures and have reacted with efforts aimed at strengthening the system, including many provisions of The Sarbanes-Oxley Act of 2002.

More recent initiatives by regulators to streamline financial reporting standards and accounting include:

Public Companies have been filing financial statements with the SEC since the passage of the Securities Exchange Act of 1934.

March 28, 2006 reply from Bob Jensen

Hi Denny,

 I know that we disagree on the principles based standards initiative. My negative position on this is outlined somewhat at

I just don't think the principles based Ten Commandments are sufficient to discard all statutes on felony law. I don't think we can discard all FDA rules on drug testing and replace them with principles based guidelines for pharmaceutical companies to follow. The same can be said for environmental protection regulations, child protective services, and whatever. Sometimes we need detailed rules so we have better guidance as to what is right and what is wrong in specific and complex circumstances.

You and I go back to the old days (and we passed the CPA exam). GAAP was much less complex and could virtually be memorized. We go back to the days when much was left to "auditor judgment."

But we also go back to the days when CEOs were not fanatics about hitting analyst forecasts. We go back to days when top-tier management compensation did not swing heavily an eps number. We go back to the days when debt was debt and equity was equity. More importantly we go back to the days when an auditor could actually understand contracts being written.

In the past CEOs respected auditor decisions and did not threaten auditors like in so many companies are doing today. Too many times in recent years we've seen where virtually all big auditing firms have caved in to pressures from large clients such as the way KPMG caved in on Fannie Mae and Andersen caved in on various big clients ---

I think that less complex principles based standards will only increase conflicts between clients and auditors. Neither will know that rules (albeit complex rules as in the case of derivatives, leases, VIEs, and pensions) are being broken if there are no detailed rules to be broken.

 I think the absence of detailed rules greatly increase inconsistencies in "auditor judgment." I think absence of detailed rules takes away auditor bargaining chips when dealing with clients.

I guess my bottom line conclusion is that the global world of contracting, risk management, and mezzanine debt is totally unlike the simpler world back in the old days when we were auditor whippersnappers.

 Bob Jensen

Scientific Method in Accounting Has Not Been a Method for Generating New Theories

The following is a quote from the 1993 President’s Message of Gary Sundem, President’s Message. Accounting Education News 21 (3). 3.

Although empirical scientific method has made many positive contributions to accounting research, it is not the method that is likely to generate new theories, though it will be useful in testing them. For example, Einstein’s theories were not developed empirically, but they relied on understanding the empirical evidence and they were tested empirically. Both the development and testing of theories should be recognized as acceptable accounting research.

Bob Jensen's threads on accounting research methods ---

But Scientific Method Can Be Used to Test Theories (at least indirectly)
With the aid of a researcher from the University of Iowa, the WSJ
uncovers evidence of backdating of employee stock options

"How the Journal Analyzed Stock-Option Grants," by Charles Forelle, The Wall Street Journal, March 18, 2006; Page A5 ---

The Wall Street Journal asked Erik Lie, an associate professor of finance at the University of Iowa who has studied backdating, to generate a list of companies that made stock-option grants that were followed by large gains in the stock price.

The Journal examined a number of the companies, looking at all of their option grants to their top executive from roughly 1995 through mid-2002. Securities-law changes in 2002 curtailed the potential for backdating a grant. Executives typically receive option grants annually.

Mr. Lie and other academics say a pattern of sharp stock appreciation after grant dates is an indication of backdating; by chance alone, grants ought to be followed by a mixed bag of stock performance -- some rises, some declines.

To quantify how unusual a particular pattern of grants is, the Journal calculated how much each company's stock rose in the 20 trading days following each grant date. The analysis then ranked that appreciation against the stock performance in the 20 days following all other trading days of the year. It ranked all 252 or so trading days in a given year according to how much the stock rose or fell following them.

For instance, Affiliated Computer Services Inc. reported an option grant to its then-president, Jeffrey Rich, dated Oct. 8, 1998. In the succeeding 20 trading days -- equal to roughly a month -- ACS stock rose 60.2%. That huge gain was the best 20-trading-day performance all year for ACS. So the Journal ranked Oct. 8 No. 1 for ACS for 1998.

It is very unlikely that several grants spread over a number of years would all fall on high-ranked days.

But all six of Mr. Rich's did. Another of his option grants also fell on the No. 1-ranked day of a year, March 9, 1995. Two grants fell on the second-ranked day, those in 1996 and 1997. In 20 02, his options grant was on the third-ranked day of the year, and in 2000, his grant came on the fourth-ranked day.

If a year has 252 trading days, the probability of a single options grant coming on the top-ranked day of that year would be one in 252. The chance of it coming on a day ranked No. 8 or better would be eight in 252.

The analysis then used the probability of each grant to figure how likely it is that an executive's overall multiyear grant pattern, or one more extreme than the actual pattern, occurred merely by chance. The more high-ranked days in the pattern, the longer the odds and the more likely it is that some factor other than chance influenced those dates. Two companies said they did use something other than chance -- they made grants on days when they thought the stock was temporarily low. This could explain results that differ somewhat from chance, but it wouldn't account for the extreme patterns of consistent post-grant rises.

John Emerson, an assistant professor of statistics at Yale, reviewed the methodology and developed a computer program to calculate the probabilities for all of the executives' grants except those to UnitedHealth CEO William McGuire. Because the number of his grants and complexity of his pattern made a computational method infeasible, the Journal used an estimate for his probability that Mr. Emerson said is conservative. Mr. Emerson said the figures for all six executives surpass a standard threshold statisticians use to assess the significance of a result.

For Mr. Rich's grants, the Journal's methodology puts the overall odds of a chance occurrence at about one in 300 billion -- less likely than flipping a coin 38 times and having it come up "heads" every time.

Exceedingly long odds also turned up in the Journal's analysis of grant-date patterns at several other companies. "It's very, very, very unlikely that they could have produced such patterns just by choosing random dates," said Mr. Lie.

David Yermack, an associate professor of finance at New York University, reviewed the Journal's methodology and said it was a reasonable way to identify suspicious patterns of grants. But Mr. Yermack also said the odds shouldn't be thought of as precise figures, largely because they depend on assumptions in the method used to determine which grant dates are more favorable than others.

Because nobody actually authorizing the grant on a given day could have known how the stock would do in the future, the Journal's analysis used post-grant price surges as an indication of possible backdating. Academics theorize that the most effective way to consistently capture low-price days for option grants is to wait until after a stock has risen, then backdate a grant to a day prior to that rise.

The decision to look at 20 trading days after each grant was arbitrary. But Messrs. Yermack and Lie said it was a reasonable yardstick to detect possible backdating. Using a longer period, such as a year, wouldn't be a good way to spot backdating of a few days or weeks because the longer-term trading would overwhelm any backdating effect.

The 20-day price rises don't present an immediate opportunity to profit, since options can't usually be exercised until held a year or more. But when the options do become exercisable, they'll be more valuable if they were priced when the stock was low.

Bob Jensen's threads on accounting for employee stock options are at

From The Wall Street Journal Accounting Weekly Review on March 24, 2006

TITLE: At Knight Ridder, Margins Shine
REPORTER: Steven D. Jones
DATE: Mar 16, 2006
TOPICS: Accounting, Financial Accounting, Financial Analysis, Financial Statement Analysis, Income from Continuing Operations

SUMMARY: In this article, the author compares several income statement based financial ratios, such as profit margin and operating earnings ratios, among companies in different industries. He then further analyzes reasons behind positive and negative perceptions of ratios that are numerically comparable. There are concerns about definitions provided in the article and some questions highlight those issues.

1.) List all financial ratios cited in the article. Provide a definition of each from an accounting textbook glossary and include a description of how to calculate the ratio.

2.) The author writes that "net profit margin is the broadest measure of a company's ability to efficiently run itself." Do you agree with that statement? Support your answer with reference to the definition of the ratio given in answer to number 1 above and by making specific reference to efficiency ratios.

3.) How does the author compare several companies' net profit ratios? What other income statement items does the author consider to support arguments that ConocoPhillips is faring well, but Knight Ridder is not doing as well, while both show approximately the same profit margin of 8.3% and 8.4%, respectively?

4.) In what ways does the author consider trends over time in order to assess the nature of profit margins at any particular point in time?

5.) How does the author add industry information to the time series analysis of financial ratios?

Reviewed By: Judy Beckman, University of Rhode Island


TITLE: McClatchy Agrees to Acquire Knight Ridder for $4.5 Billion
REPORTERS: On-line Journal Editors with Joseph T. Hallinan and Dennis K. Berman
ISSUE: Mar 13, 2006

TITLE: Analysts Chart Out Landscape for Papers After McClatchy Deal
REPORTER: Compiled by Worth Civils
ISSUE: Mar 13, 2006

"At Knight Ridder, Margins Shine:  Publisher Stacks Up Well By Some Profit Measures Though Revenue Is Weak." by Steven D. Jones, The Wall Street Journal, March 16, 2006; Page C3 ---

What does an oil company that was recently brought before Congress to explain its record profits have in common with a newspaper publisher that agreed to be sold this week? They generate nearly identical net profit margins.

ConocoPhillips, which had a net profit margin of 8.3% last year, had been accused by some lawmakers of making a windfall profit on the rally in crude oil -- a charge the company and other oil giants strongly deny. Knight Ridder Inc., which had a net profit margin of 8.4% in 2005, is trying to convince people the newspaper business is still relevant, and the company just agreed to sell itself to smaller competitor McClatchy Co. in a deal that is now valued at about $66 a share, or $4.5 billion.

Net profit margin is the broadest measure of a company's ability to efficiently run itself. It is calculated by dividing net profit by net revenue.

The comparison of the two companies illustrates that operating prowess alone doesn't equal market success, and there are plenty of other examples. The upshot: On measures of profitability often watched by investors, weakened companies often look as good as Wall Street darlings.

Wall Street and some of Knight Ridder's own shareholders came to doubt the company's worth because of its falling revenue growth: Knight Ridder's top line rose less than 1% last year, according to Thomson Financial, a data and research firm. ConocoPhillips's revenue rose 29% in the same period.

Knight Ridder's margins were even better a few years ago, points out John Janedis, media analyst for Banc of America Securities, which does investment-banking work for the publisher. And they still stack up or even best margins seen in other industries, particularly the net operating margins, which are a measure of the company's skills at running its core businesses.

For instance, operating-profit margins at Knight Ridder were over 16% in the fourth quarter, compared with 15% at the Wall Street giant Merrill Lynch & Co. Operating margins take into account all wage and production costs and are calculated by dividing a company's operating profit before taxes and interest payments due by its net revenue. Over a five-year period, Knight Ridder's operating margins have averaged 19.5% compared with 14% at the venerable brokerage house.

The booming steel industry, whose stocks have risen 30% so far this year, enjoyed operating margins of 14% in the most recent quarter. Over the past five years, operating margins in the steel business have averaged a little better than 6%.

Looking again at net profit margin, Knight Ridder is managing better than half the companies in the Standard & Poor's 500-stock index. Knight Ridder's 8.4% return over the past 12 months puts it at No. 216 among companies in the S&P 500, according to Thomson Financial. That also puts Knight Ridder ahead of other major publishers and even ahead of coffee merchant Starbucks Corp.

Knight Ridder even stacks up well against some companies in another hot stock sector: technology. For example, Knight Ridder's standing on three key profit measures -- pretax, operating and net -- were comparable to electronic-equipment maker Tektronix Inc. of Beaverton, Ore., according to the Thomson analysis. And Tektronix shares have been flirting with a new 52-week high of more than $32 a share.

California utility PG&E Corp. also delivers similar profit ratios as Knight Ridder. And that utility was able to shed a lot of costs when it went through bankruptcy reorganization early this decade.

Bob Jensen has a somewhat dated set of bookmarks on financial ratios at

Distance Education versus Onsite Education

Barbara gave me permission to post the following message on March 15, 2006
My reply follows her message.

Professor Jensen:

I need your help in working with regulators who are uncomfortable with online education.

I am currently on the faculty at the University of Dallas in Irving, Texas and I abruptly learned yesterday that the Texas State Board of Public Accountancy distinguishes online and on campus offering of ethics courses that it approves as counting for students to meet CPA candidacy requirements. Since my school offers its ethics course in both modes, I am suddenly faced with making a case to the TSBPA in one week's time to avoid rejection of the online version of the University of Dallas course.

I have included in this email the "story" as I understand it that explains my situation. It isn't a story about accounting or ethics, it is a story about online education.

I would like to talk to you tomorrow because of your expertise in distance education and involvement in the profession. In addition, I am building a portfolio of materials this week for the Board meeting in Austin March 22-23 to make a case for their approval (or at least not rejection) of the online version of the ethics course that the Board already accepts in its on campus version. I want to include compelling research-based material demonstrating the value of online learning, and I don't have time to begin that literature survey myself. In addition, I want to be able to present preliminary results from reviewers of the University of Dallas course about the course's merit in presentation of the content in an online delivery.

Thank you for any assistance that you can give me.

Barbara W. Scofield
Associate Professor of Accounting
University of Dallas
1845 E Northgate Irving, TX 75062

A statement of the University of Dallas and Texas State Board of Public Accountancy and Online Learning

The TSBPA approved the University of Dallas ethics program in 2004. The course that was approved was a long-standing course, required in several different graduate programs, called Business Ethics. The course was regularly taught on campus (since 1995) and online (since 2001).

The application for approval of the ethics course did not ask for information about whether the class was on campus or online and the syllabus that was submitted happened to be the syllabus of an on campus section. The TSBPA's position (via Donna Hiller) is that the Board intended to approve only the on campus version of the course, and that the Board inferred it was an on campus course because the sample syllabus that was submitted was an on campus course.

Therefore the TSBPA (via Donna Hiller) is requiring that University of Dallas students who took the online version of the ethics course retake the exact same course in its on campus format. While the TSBPA (via Donna Hiller) has indicated that the online course cannot at this time be approved and its scheduled offering in the summer will not provide students with an approved course, Donna Hiller, at my request, has indicated that she will take this issue to the Board for their decision next week at the Executive Board Meeting on March 22 and the Board Meeting on March 23.

There are two issues:

1. Treatment of students who were relying on communication from the Board at the time they took the class that could reasonably have been interpreted to confer approval of both the online and on campus sections of the ethics course.

2. Status of the upcoming summer online ethics class.

My priority is establishing the status of the upcoming summer online ethics class. The Board has indicated through its pilot program with the University of Texas at Dallas that there is a place for online ethics classes in the preparation of CPA candidates. The University of Dallas is interested in providing the TSBPA with any information or assessment necessary to meet the needs of the Board to understand the online ethics class at the University of Dallas. Although not currently privy to the Board specific concerns about online courses, the University of Dallas believes that it can demonstrate sufficient credibility for the course because of the following factors:

A. The content of the online course is the same as the on campus course. Content comparison can be provided. B. The instructional methods of the online course involve intense student-to-student, instructor-to-student, and student-to-content interaction at a level equivalent to an on campus course. Empirical information about interaction in the course can be provided.

C. The instructor for the course is superbly qualified and a long-standing ethics instructor and distance learning instructor. The vita of the instructor can be provided.

D. There are processes for course assessment in place that regularly prompt the review of this course and these assessments can be provided to the board along with comparisons with the on campus assessments.

E. The University of Dallas will seek to coordinate with the work done by the University of Texas at Dallas to provide information at least equivalent to that provided by the University of Texas at Dallas and to meet at a minimum the tentative criteria for online learning that UT Dallas has been empowered to recommend to the TSBPA. Contact with the University of Texas at Dallas has been initiated.

When the online ethics course is granted a path to approval by the Board, I am also interested in addressing the issue of TSBPA approval of students who took the class between the original ethics course approval date and March 13, 2006, the date that the University of Dallas became aware of the TSBPA intent (through Donna Hiller) that the TSBPA distinguished online and on campus ethics classes.

The University of Dallas believes that the online class in fact provided these students with a course that completely fulfilled the general intent of the Board for education in ethics, since it is the same course as the approved on campus course (see above). The decision on the extent of commitment of the Board to students who relied on the Board's approval letter may be a legal issue of some sort that is outside of the current decision-making of the Board, but I want the Board take the opportunity to consider that the reasonableness of the students' position and the students' actual preparation in ethics suggest that there should also be a path created to approval of online ethics courses taken at the University of Dallas during this prior time period. The currently proposed remedy of a requirement for students to retake the very same course on campus that students have already taken online appears excessively costly to Texans and the profession of accounting by delaying the entry of otherwise qualified individuals into public accountancy. High cost is justified when the concomitant benefits are also high. However, the benefit to Texans and the accounting profession from students who retake the ethics course seems to exist only in meeting the requirements of regulations that all parties diligently sought to meet in the first place and not in producing any actual additional learning experiences.

A reply to her from Bob Jensen

Hi Barbara,

May I share your questions and my responses in the next edition of New Bookmarks? This might be helpful to your efforts when others become informed. I will be in my office every day except for March 17. My phone number is 210-999-7347. However, I can probably be more helpful via email.

As discouraging as it may seem, if students know what is expected of them and must demonstrate what they have learned, pedagogy does not seem to matter. It can be online or onsite. It can be lecture or cases. It can be no teaching at all if there are talented and motivated students who are given great learning materials. This is called the well-known “No Significant Difference” phenomenon ---

I think you should stress that insisting upon onsite courses is discriminatory against potential students whose life circumstances make it difficult or impossible to attend regular classes on campus.

I think you should make the case that online education is just like onsite education in the sense that learning depends on the quality and motivations of the students, faculty, and university that sets the employment and curriculum standards for quality. The issue is not onsite versus online. The issue is quality of effort.

The most prestigious schools like Harvard and Stanford and Notre Dame have a large number of credit and non-credit courses online. Entire accounting undergraduate and graduate degree programs are available online from such quality schools as the University of Wisconsin and the University of Maryland.  See my guide to online training and education programs is at

My main introductory document on the future of distance education is at

Anticipate and deal with the main arguments against online education. The typical argument is that onsite students have more learning interactions with themselves and with the instructor. This is absolutely false if the distance education course is designed to promote online interactions that do a better job of getting into each others’ heads.  Online courses become superior to onsite courses.

Amy Dunbar teaches intensely interactive online courses with Instant Messaging. See Dunbar, A. 2004. “Genesis of an Online Course.” Issues in Accounting Education (2004),19 (3):321-343.

ABSTRACT: This paper presents a descriptive and evaluative analysis of the transformation of a face-to-face graduate tax accounting course to an online course. One hundred fifteen students completed the compressed six-week class in 2001 and 2002 using WebCT, classroom environment software that facilitates the creation of web-based educational environments. The paper provides a description of the required technology tools and the class conduct. The students used a combination of asynchronous and synchronous learning methods that allowed them to complete the coursework on a self-determined schedule, subject to semi-weekly quiz constraints. The course material was presented in content pages with links to Excel® problems, Flash examples, audio and video files, and self-tests. Students worked the quizzes and then met in their groups in a chat room to resolve differences in answers. Student surveys indicated satisfaction with the learning methods.

I might add that Amy is a veteran world class instructor both onsite and online. She’s achieved all-university awards for onsite teaching in at least three major universities. This gives her the credentials to judge how well her online courses compare with her outstanding onsite courses.

A free audio download of a presentation by Amy Dunbar is available at   

The argument that students cannot be properly assessed for learning online is more problematic. Clearly it is easier to prevent cheating with onsite examinations. But there are ways of dealing with this problem.  My best example of an online graduate program that is extremely difficult is the Chartered Accountant School of Business (CASB) masters program for all of Western Canada. Students are required to take some onsite testing even though this is an online degree program. And CASB does a great job with ethics online. I was engaged to formally assess this program and came away extremely impressed. My main contact there is Don Carter  .  If you are really serious about this, I would invite Don to come down and make a presentation to the Board. Don will convince them of the superiority of online education.

You can read some about the CASB degree program at

You can read more about assessment issues at

I think a lot of the argument against distance education comes from faculty fearful of one day having to teach online. First there is the fear of change. Second there is the genuine fear that is entirely justified --- if online teaching is done well it is more work and strain than onsite teaching. The strain comes from increased hours of communication with each and every student.

Probably the most general argument in favor of onsite education is that students living on campus have the social interactions and maturity development outside of class. This is most certainly a valid argument. However, when it comes to issues of learning of course content, online education can be as good as or generally better than onsite classes. Students in online programs are often older and more mature such that the on-campus advantages decline in their situations. Online students generally have more life, love, and work experiences already under their belts. And besides, you’re only talking about ethics courses rather than an entire undergraduate or graduate education.

I think if you deal with the learning interaction and assessment issues that you can make a strong case for distance education. There are some “dark side” arguments that you should probably avoid. But if you care to read about them, go to

Bob Jensen

March 15, 2006 reply from Bruce Lubich [BLubich@UMUC.EDU]

Bob, as a director and teacher in a graduate accounting program that is exclusively online, I want to thank you for your support and eloquent defense of online education. Unfortunately, Texas's predisposition against online teaching also shows up in its education requirements for sitting for the CPA exam. Of the 30 required upper division accounting credits, at least 15 must "result from physical attendance at classes meeting regularly on the campus" (quote from the Texas State Board of Public Accountancy website at

Cynically speaking, it seems the state of Texas wants to be sure its classrooms are occupied.

Barbara, best of luck with your testimony.

Bruce Lubich
Program Director,
Accounting Graduate School of Management and Technology
University of Maryland University College

March 15, 2006 reply from David Albrecht [albrecht@PROFALBRECHT.COM]

At my school, Bowling Green, student credits for on-line accounting majors classes are never approved by the department chair. He says that you can't trust the schools that are offering these. When told that some very reputable schools are offering the courses, he still says no because when the testing process is done on-line or not in the physical presence of the professor the grades simply can't be trusted.

David Albrecht

March 16, 2006 reply from Bob Jensen

Hi David,

One tack against a luddites like that is to propose a compromise that virtually accepts all transfer credits from AACSB-accredited universities. It's difficult to argue that standards vary between online and onsite courses in a given program accredited by the AACSB. I seriously doubt that the faculty in that program would allow a double academic standard.

In fact, on transcripts it is often impossible to distinguish online from onsite credits from a respected universities, especially when the same course is offered online and onsite (i.e., merely in different sections).

You might explain to your department chair that he's probably been accepting online transfer credits for some time. The University of North Texas and other major universities now offer online courses to full-time resident students who live on campus. Some students and instructors find this to be a better approach to learning.

And you ask him why Bowling Green's assessment rigor is not widely known to be vastly superior to online courses from nearly all major universities that now offer distance education courses and even total degree programs, including schools like the Fuqua Graduate School at Duke, Stanford University (especially computer science and engineering online courses that bring in over $100 million per year), the University of Maryland, the University of Wisconsin, the University of Texas, Texas Tech, and even, gasp, The Ohio State University.

You might tell your department chair that by not offering some online alternatives, Bowling Green is not getting the most out of its students. The University of Illinois conducted a major study that found that students performed better in online versus onsite courses when matched pair sections took the same examinations.

And then you might top it off by asking your department chair how he justifies denying credit for Bowling Green's own distance education courses --- 
The following is a quotation from the above Bowling Green site:

The advancement of computer technology has provided a wealth of new opportunities for learning. Distance education is one example of technology’s ability to expand our horizons and gain from new experiences. BGSU offers many distance education courses and two baccalaureate degree completion programs online.

The Advanced Technological Education Degree Program is designed for individuals who have completed a two-year applied associate’s degree. The Bachelor of Liberal Studies Degree Program is ideal for students with previous college credit who would like flexibility in course selection while completing a liberal education program.

Distance Education Courses and Programs ---  ***************************

Bob Jensen

March 16, 2006 reply from Amy Dunbar [Amy.Dunbar@BUSINESS.UCONN.EDU]

Count me in the camp that just isn't that concerned about online cheating. Perhaps that is because my students are graduate students and my online exams are open-book, timed exams, and a different version is presented to each student (much like a driver's license exam). In my end-of-semester survey, I ask whether students are concerned about cheating, and on occasion, I get one who is. But generally the response is no.

The UConn accounting department was just reviewed by the AACSB, and they were impressed by our MSA online program. They commented that they now believed that an online MSA program was possible. I am convinced that the people who are opposed to online education are unwilling to invest the time to see how online education is implemented. Sure there will be bad examples, but there are bad examples of face to face (FTF) teaching. How many profs do you know who simply read powerpoint slides to a sleeping class?! Last semester, I received the School of Business graduate teaching award even though I teach only online classes. I believe that the factor that really matters is that the students know you care about whether they are learning. A prof who cares interacts with students. You can do that online as well as FTF.

Do I miss FTF teaching -- you bet I do. But once I focused on what the student really needs to learn, I realized, much to my dismay, interacting FTF with Dunbar was not a necessary condition.

Amy Dunbar

March 20, 2006 reply from Linda Kidwell, University of Wyoming [lkidwell@UWYO.EDU]

For what it's worth, my research in academic dishonesty has led me to believe that cheating in distance education is not a big problem, relative to face-to-face education. I'm working on a paper where students at a university with a massive distance program, approximately 60% of their student credit hours, and so-called internal students took self-reporting cheating surveys, similar to the methodology used by Don McCabe, the preeminent expert in this area. The reported cheating levels were significantly less for the distance students, in large part because they lacked the opportunity to interact with students who might be willing accomplices. Although they have streaming chat, there is tremendous risk in contacting someone they don't know to instigate a cheating network. Exams are proctored however.


March 16, 2006 message from Carol Flowers [cflowers@OCC.CCCD.EDU]

To resolve this issue and make me more comfortable with the grade a student earns, I have all my online exams proctored. I schedule weekends (placing them in the schedule of classes) and it is mandatory that they take the exams during this weekend period (Fir/Sat) at our computing center. It is my policy that if they can't take the paced exams during those periods, then the class is not one that they can participate in. This is no different from having different times that courses are offered. They have to make a choice in that situation, also, as to which time will best serve their needs.

March 16, 2006 reply from David Fordham, James Madison University [fordhadr@JMU.EDU]

Our model is similar to Carol Flowers. Our on-line MBA program requires an in-person meeting for four hours at the beginning of every semester, to let the students and professor get to know each other personally, followed by the distance-ed portion, concluding with another four-hour in- person session for the final examination or other assessment. The students all congregate at the Sheraton at Dulles airport, have dinner together Friday night, spend Saturday morning taking the final for their previous class, and spend Saturday afternoon being introduced to their next class. They do this between every semester. So far, the on- line group has outperformed (very slightly, and not statistically significant due to small sample sizes) the face-to-face counterparts being used as our control groups. We believe the outperformance might have an inherent self- selection bias since the distance-learners are usually professionals, whereas many of our face-to-face students are full-time students and generally a bit younger and more immature.

My personal on-line course consists of exactly the same readings as my F2F class, and exactly the same lectures (recorded using Tegrity) provided on CD and watched asynchronously, followed by on-line synchronous discussion sessions (2-3 hours per week) where I call on random students asking questions about the readings, lectures, etc., and engaging in lively discussion. I prepare some interesting cases and application dilemmas (mostly adapted from real world scenarios) and introduce dilemmas, gray areas, controversy (you expected maybe peace and quiet from David Fordham?!), and other thought-provoking issues for discussion. I have almost perfect attendance in the on-line synchronous because the students really find the discussions engaging. Surprisingly, I have no problem with freeloaders who don't read or watch the recorded lectures. My major student assessment vehicle is an individual policy manual, supplemented by the in-person exam. Since each student's manual organization, layout, approach, and perspective is so very different from the others, cheating is almost out of the question. And the in-person exam is conducted almost like the CISP or old CPA exams... total quiet, no talking, no leaving the room, nothing but a pencil, etc.

And finally, no, you can't tell the difference on our student's transcript as to whether they took the on-line or in-person MBA. They look identical on the transcript.

We've not yet had any problem with anyone "rejecting" our credential that I'm aware of.

Regarding our own acceptance of transfer credit, we make the student provide evidence of the quality of each course (not the degree) before we exempt or accept credit. We do not distinguish between on-line or F2F -- nor do we automatically accept a course based on institution reputation. We have on many occasions rejected AACSB- accredited institution courses (on a course-by-course basis) because our investigation showed that the course coverage or rigor was not up to the standard we required. (The only "blanket" exception that we make is for certain familiar Virginia community college courses in the liberal studies where history has shown that the college and coursework reliably meets the standards -- every other course has to be accepted on a course-by-course basis.)

Just our $0.02 worth.

David Fordham
James Madison University

"Say Cheerio to Jeeves," by Arik Hesseldahl, Business Week, February 27, 2006 --- Click Here

AskJeeves' signature butler, borrowed from novelist P.G. Wodehouse, is being dropped, as the search site switches names to and revamps its format

After nearly a decade as the search engine with a human face, is dumping the cheerful visage of the butler that has graced its pages.  Starting on Feb. 27, the site will become known simply as

The character had been used under an agreement reached in 2000 with the estate of the late British novelist, P.G. Wodehouse, who penned a series of novels involving the adventures of the butler Jeeves and his master Bertie Wooster.  When initially launched, allowed users to phrase their search terms as questions, such as "What is the capital of Ohio?" or "How many cups are in a gallon?"

Those days are over, says Daniel Read, vice-president for consumer products at the new Ask.Com, which for nearly a year has been part of IAC Search & Media, a unit of IAC/Interactive (IACI), Barry Diller's $5.7 billion (2005 sales) Internet concern: "The old name hearkened back to what we were five to seven years ago and not what we are now.  And while we found there were some customers who were loyal to the AskJeeves name, most of our users were ambivalent about it."  IAC paid $1.85 billion for the site, which first launched in 1996.

PHASED OUT.  The question approach worked for a few years, and initially the company found a business building customer-support Web sites that would allow customers to ask questions on the Web.  The business model changed when in 2001, AskJeeves acquired itself once dubbed a "Google-killer," and built the Teoma search technology into the AskJeeves site.  Starting on Feb. 27, will redirect users to

Jeeve's "retirement" hasn't been much of a secret.  Diller has been quoted several times over the last year as saying that the character would be phased out.

"Lycos Europe's Survival Instincts," by Jack Ewing, Business Week, February 24, 2006 --- Click Here

The Web outfit is relying on a new, more focused, search engine and cost cuts to deliver growth.  Does it stand a chance against Google?

By most conventional financial measures, Lycos Europe should probably not exist.  The Internet portal, search engine, and Web services provider, part owned by German media giant Bertelsmann and Spanish telco Telefónica (TEF), has had only two profitable quarters in its six-year history.  It's competing in a business dominated by Google (GOOG) and Yahoo! (YHOO).  And it must cope with the European market, where economies of scale are undercut by the need to offer content tailored to national tastes and languages.

Yet on Feb. 22, Lycos Europe Chief Executive Christoph Mohn stood bravely before a handful of reporters and analysts and explained why he believes the company will finally be profitable in 2006.  "In a couple of years people will see that we're one of the few global players," said Mohn, while standing before a laptop at a Frankfurt hotel conference room and paging through a PowerPoint presentation on the company's 2005 results.  Lycos' loss narrowed to $24 million on sales of $149 million last year, vs. a loss of $54 million in 2004.

Somebody believes Mohn.  Shares of Lycos Europe, which is a separate company from US.-based Lycos, rose more than 60% last year.  True, the recent price of 1.07 euros ($1.27) was still a long way from the 2000 Internet bubble price of more than 23 euros.  And the shares fell sharply after the 2005 results were announced.  But long after most highfliers from those days have been forgotten, Lycos still employs almost 700 people, primarily in Gütersloh, Germany, and offers services in eight European countries, plus the former Soviet republic of Armenia.  It's also the largest chat service in Europe, with 5 million users.

WORLD AT YOUR FINGERTIPS.  Mohn is clearly true believer No. 1.  With an enthusiasm that recalls the Internet euphoria of a few years ago, he describes the new technologies that he argues will someday allow Lycos to earn a decent return.  The newest service, just introduced in Germany and currently being rolled out across Europe, is a search engine called Lycos iQ that's supposed to give more focused results than Google does.

Users can type in a question, which other users answer.  Users rank answers the same way that eBay (EBAY) users rate sellers of goods.  The idea is to build a database of questions and answers, with the best answers rising to the top of the list.  (It works: This writer asked for advice on the best places to cross-country ski around Frankfurt, and within a few minutes received an e-mail with a link to a Web site devoted to the topic.)  "Lycos allows you to tap into the knowledge of the whole population," Mohn said in an interview.

Will that be enough to compete against the huge resources of Google?  "I don't think [Lycos Europe has] a chance, to be honest," says Hellen K. Omwando, an analyst at Forrester Research in Amsterdam.  "Look at Yahoo and MSN--even they can't manage to siphon away Google users."

"ONE OF THE SURVIVORS."  Omwando praises Lycos' cost-cutting measures, which included eliminating more than 200 jobs last year.  She also has kudos for some of Lycos' business-to-business services, such as software that allows small businesses to easily set up online shops.  But Omwando says the individual assets don't add up to long-term growth.  "Lycos is one of those players waiting to be sold," she says.

Bob Jensen's search helpers are at

"Searching the Web for Video Clips" by Walt Mossberg and Katherine Boehret, The Wall Street Journal, March 1, 2006, Page D4 ---

Video on the Web is all the rage now, the subject of an endless stream of articles and speculation that it's the next big thing. And there's some evidence to back that up. Apple Computer Inc. sold 12 million video clips at $1.99 each from its popular iTunes Music Store in just a few months. Google has made a splash with a similar video download store. According to AccuStream iMedia Research, about 18 billion video streams were online in 2005 and that number is expected to grow by more than 30% in 2006.

But how do you find the video clips you'd like to see, or download? Normal search engines like Google's can sometimes point you to video clips, but they aren't optimized for that task.

So, this week, we dived into the world of online videos, looking for the best ways to find clips. We were impressed by how much material is out there -- much of it free. We used about 10 different video searching/hosting sites to find videos related to TV shows, including "Grey's Anatomy," Hollywood actors, like Matthew McConaughey, and musicians, like Brad Paisley. We also searched for news videos, ads and amateur videos. We even looked for a famous "Saturday Night Live" mock music video, and its imitators.

Our results: AOL Video Search, Yahoo Video Search, and Blinkx TV earned our appreciation because each searches the entire Internet for material, and does a decent job.

Google Video and iTunes also perform video searches, but they search only among the material they host on their own servers, and which they offer for sale, or for free downloading. They don't search across the entire Web. Sites like and have sprung up as central download sites for all sorts of video clips, some by amateurs and some by pros. But they, too, search only the material they offer themselves.

The technology for searching the actual spoken words in a video exists, but is in its infancy. So, most video searches are done by looking for words in a video's title text, or in descriptions or other information embedded in a video file in the form of "metadata" or "tags" -- kind of like the embedded title, artist and album information in a music file. Some TV shows stored on the Web also contain closed captioning data, and that can be searched in some cases.

AOL Video Search ( uses the search engines of two smaller, yet powerful, companies that it owns: and As you use AOL Video Search, your past search topics are saved in a left-hand column and videos can be saved into a special AOL playlist. An adult content filter is used on AOL's server, meaning users can't turn the filter on or off.

Using AOL, we found and watched the "Saturday Night Live" mock music video called "Lazy Sunday," set in New York, and its West Coast response, "Lazy Monday," set in Los Angeles.

Yahoo Video Search ( can display results in a visually attractive grid of images from each video clip. Unlike AOL, which displays advertisements on its search start and results page, Yahoo doesn't show ads on either page -- though ads will display if they're linked to videos from outside sources. A SafeSearch filter can be used for blocking adult material as you search videos.

Using Yahoo's video search, we turned up clips of a forgettable 1998 appearance Walt made in an East Coast vs. West Coast computer trivia contest held in Boston. Not only was his East Coast team crushed, but they wore puffy colonial shirts while being crushed.

Blinkx TV ( uses a simple interface and makes searching easy -- an empty box placed on the left of the screen with a collage of 100 tiny clip images playing on the right. After results are returned, you can adjust a horizontal slider between "date" or "relevance," depending on your preference. Our results weren't always as accurate with Blinkx as they were with other video-search sites -- one search returned spreadsheets rather than videos -- but we liked how the results page played animated clips of each video in the same window. Blinkx offers a prominent filtering button to hide adult results.

Google Video (, which is still in its beta (or prerelease) version, also offers video searching through free videos -- but allows you to search only through material that Google hosts, or streams from its servers. This site eliminates ads -- including Google's word-only ads -- entirely, which is refreshing.

Bob Jensen's links to online video are at

Click Fraud Gets Smarter
Internet ad-traffic scams could be ripping off as much as $1 billion annually. Are Web companies like Google doing enough to foil them?

"Click Fraud Gets Smarter," by Burt Helm, Business Week, February 27, 2006 --- Click Here 

Internet ad-traffic scams could be ripping off as much as $1 billion annually.  Are Web companies like Google doing enough to foil them?

Web consultant Greg Boser has an ingenious method for sending loads of traffic to clients' Internet sites.  Last month he began using a software program known as a clickbot to create the impression that users from around the world were visiting sites by way of ads strategically placed alongside Google search results.  The trouble is, all the clicks are fake.  And because Google charges advertisers on a per-click basis, the extra traffic could mean sky-high bills for Boser's clients.

But Boser's no fraudster.  He cleared the procedure with clients beforehand and plans to reimburse any resulting charges.  What's he up to?  Boser wants to get to the bottom of a blight that's creating growing concern for online advertisers and threatens to wreak havoc across the Internet: click fraud.

BILLION-DOLLAR QUESTION.  The practice can wildly skew statistics on the popularity of an ad, drain marketing budgets, and enrich the scam artists behind it.  While click fraud isn't new, the methods for carrying it out--take Boser's clickbot software--are getting increasingly sophisticated.  And some advertisers, analysts and consultants question whether Web companies such as Google (GOOG) and Yahoo (YHOO) are doing enough to nip click fraud in the bud.  "No one has any idea how much of this is actually going on," says Boser.  "So we're going to see how well [the search engines] actually try to protect advertisers."

One of Boser's biggest challenges is putting a finger on exactly how widespread the practice is.  Some search consultants say click fraud accounts for upwards of 20% of all traffic, and may generate more than $1 billion in dubious sales a year.  Others say those stats vastly overstate the problem.

Now, one of the biggest players in fraud detection aims to end the guessing.  Fair Isaac (FIC), which analyzes 85% of U.S. credit card transactions, in partnership with Web search consultancy Alchemist Media, will unveil plans at this week's Search Engine Strategies Conference for what it says is the most rigorous study ever of click fraud.  Fair Issac will invite companies to submit traffic data that can be mined for aberrations that may signify fraud.  "We've seen indications that the overall losses due to click fraud could equal more than $1 billion [a year]--larger than the total magnitude of credit card fraud in the U.S.," says Kandathil Jacob, Fair Issac's director of product marketing.  "It's certainly worth our effort to look at it."

MORE CLICKS, MORE DOLLARS.  A rising number of companies would agree.  The percentage of advertisers listing click fraud as a "serious" problem tripled in 2005, to 16%, according to a survey by the Search Engine Marketing Professional Organization.  Advertisers have filed at least two class-action suits saying Google, Yahoo, and other search engines ought to be more up-front about methods for combating the practice.  Google says the suits are meritless.  Yahoo declines to comment.

And in January, Standard & Poor's equity analyst Scott Kessler downgraded Google stock in part because he considers click fraud a "notable risk" (see BW Online, 1/17/06, "S&P Downgrades Google to Sell").  Among his concerns: the prospect of false clicks may sour companies from placing ads on Google.  He too says Google needs to be more forthcoming on the issue.  "No one has any idea as to what Google assesses [as] its own percentage of clicks that are generated by fraud, no idea what that process consists of, and all the things that are being done to battle it," he says.

Bob Jensen's theads on consumer fraud are at

If you lost your hotel room's magnetic strip card that opens the door, I'll just be you thought your were free of all worries when you simply got a replacement card with a changed code that unlocks the hotel room door. Could anybody who found or stole your original card still take advantage of you?

"Street-Level Credit Card Fraud," by Brian Krebs, The Washington Post, March 6, 2006 --- Click Here

Until recently, Las Vegas police officers couldn't figure out why some of the prostitutes and drug addicts they arrested were found carrying multiple hotel room keys and slot machine player's club cards. When confronted, the suspects said they kept them as souvenirs or found them on the sidewalk. The cops initially assumed that the cards were stolen, or -- in the case of the prostitutes -- perhaps belonged to some of their more frequent clients.

"It was getting fairly regular that in post-arrest inventory, we would find eight to 10 room key cards ... all from different hotels," said Dennis Cobb, deputy chief of the Las Vegas Metropolitan Police Department's Technical Services Division.

The mystery began to unravel when a LVMPD officer slid one of the keys through a machine that reads the data stored on the card's magnetic stripe. Each swipe revealed a 16-digit credit number, a date, a person's name and the name of a bank. That's right, the keys functioned exactly like credit cards, allowing the carrier to pay for merchandise at any store or market where customers do their own swiping.

"The people who had these cards on them were using them in transactions with local businesses," Cobb said.

The revelation is hardly a surprising one for a city that had the nation's second highest rate of identity-theft complaints to the Federal Trade Commission last year. Cobb said the stolen card data comes from a variety of sources, but he said it is not unusual for service-industry workers who owe money to a drug dealer or a bookie to be handed a handheld magnetic stripe "skimmer" and ordered to periodically collect up to 100 accounts as a means of erasing their debt.

The discovery led Cobb's division to team up with researchers from the Identity Theft and Financial Fraud Research and Operations Center (IFFROC) at the University of Nevada, Las Vegas to devise technologies that police could deploy in the field to detect various types of fraud.

Hal Berghel, the center's director, said the people who are usually caught with key cards use them primarily at convenience stores, gas stations and other places where purchases are less than $20, which is below the scrutiny threshold for most fraud-detection technologies.

"By the time the bottom feeders get the cards, the data on them has already been shared with the organized criminals, who will bang on a credit card though mail-order and Internet purchases," Berghel said. At that point the cards are "throwaways that can only be used a couple of times before they're canceled."

Last year, Berghel filed a patent application on behalf of IFFROC for a technology called "Cardsleuth," software he demoed for me when we met up last week in Washington. He hopes that one day a pen-sized device will be used to read magnetic stripes and alert the user when unexpected data is found. Berghel and his team are working on a prototype, which he said could be updated periodically via a USB-based docking station.

Berghel said the technology could be especially useful in the case of a 9/11-type emergency by helping authorities distinguish first responders from those individuals -- be they terrorists or merely looters -- who might take advantage of a chaotic environment.

"There is still a need for on-the-spot validation of credentials where you have a convergence of emergency workers, many of whom have never seen each other before," he said.

Update, 11:45 a.m. ET: Apparently, I didn't make it clear enough what is really going on here. This post is not suggesting that hotel room keys are being encoded with credit card information by the hotels, which has always been something of an urban legend/e-mail hoax (see Snopes and previous discussions on Slashdot.) The folks I interviewed for this piece said the encoding was being done by the criminals (or more specifically, fraud rings who sold them to street hustlers who would wring every last dollar out of the cards before they were cancelled). From the crooks' perspective, the idea behind this is to be able to anonymously use someone else's credit card at a physical location; someone who got arrested holding someone else's actual credit card would have a lot of explaining to do, but hotel room keys are likely to be overlooked or set aside for what they appear to be.

March 6, 2006 reply from David Fordham, James Madison University [fordhadr@JMU.EDU]

Bob, at first I was going to congratulate you on being hoaxed, but then I saw the addendum and explanation. But hey, you don't need a hotel key card to do that -- you can re-encode any magnetic stripe (even a subway pass for example) to serve the same purpose can't you? Any mag stripe can serve as the medium at the gas pump, can't it? But wait...

This is beginning to sound fishy. I question the accuracy of the quotes, or the critical thinking skills of the sources quoted. In fact, I'm thinking this whole article might be a hoax... or perhaps a "joax"? Let's take a closer look...

First, the data on practically all credit cards these days is super-encrypted, using layers of encryption, pads, padding, and "check-digits on steroids".

I do not place a lot of faith in the accuracy of the claim, "The mystery began to unravel when a LVMPD officer slid one of the keys through a machine that reads the data stored on the card's magnetic stripe. Each swipe revealed a 16-digit credit number, a date, a person's name and the name of a bank. That's right..."

Nope, that's wrong. Baloney. Maybe back when I was a kid, but not today. Credit card companies aren't that stupid.

I have used a card reader to demonstrate to my students that commercial cards, even low-level ones like the pizza cards, hotel keys, and even the subway cards, DO NOT put unencrypted data on the cards, let alone sensitive stuff like account numbers on legitimate credit cards like Visa and Mastercard. The data on their magnetic stripes is utter gibberish unless you know how to decrypt it. A simple card reader does not "reveal" account numbers, bank names, etc. Joke number one.

What's more, card READERS do NOT have the (highly proprietary) algorithms to decode the data! The encrypted data stream is sent to the headquarters (card center) computer still encrypted, (double-encrypted, since the card readers encrypt the encrypted data again before transmitting it over the datalink to the card center!) where the card center computer then decodes the data! The card center then sends the cardholders name, last four digits of the account, etc. back to the merchant's computer to print the receipt. So I doubt that "each swipe revealed..."

Even if you knew the algorithm, you'd still need the encryption KEY! Credit card companies don't even let police departments know their decryption keys. Joke number two. This inaccuracy makes me question the legitimacy of the rest of the article.

Think about what the rest of the article is saying. Since the data on a legitimate card is encrypted nine ways to Sunday, it is highly unlikely anyone can "create" the encoded data string from scratch. What is easier to do (and indeed CAN be done) is to COPY a valid string off a valid card, and write the copied string onto a new card. Of course, with "smart cards", this is pretty-nigh impossible because the card itself may have an RFID chip (some European cards even have imbedded chips with gold electrical contacts for reading) which contains a "serial number" -- which number is incorporated as part of the key (encryption pad) to encode the data on the magnetic stripe! Double layer protection. The chip's serial number is built into it at time of manufacture and can't be changed, or duplicated unless you have access to a chip-manufacturing plant.

But even if you weren't duplicating a smart card, duplicatng the encrypted data string from a plain old credit card stripe still means you must first physically be in possession of the original card, right? Follow my logic here.

So, if you are in possession of the original card to start with, why make a copy?

The only reason I can think of is this: you steal a card without someone detecting it, copy it, and replace the card before the victim knows it's gone. (Under any other scenario, the victim is sure to cancel the card the instant he notices the theft.) So you have to take the stolen original card and read it, then replace it, then make a duplicate -- hmmmm.

So here's where joke number three comes in: look at the sentence in the article: "but he said it is not unusual for service-industry workers who owe money to a drug dealer or a bookie to be handed a handheld magnetic stripe "skimmer" and ordered to periodically collect up to 100 accounts ..."

Not unusual? Come on, gimme a break! Even professional pickpockets have to use care to steal a card without detection, let alone REPLACE IT without detection! And this reporter expects me to believe that any Tom, Dick or Harry "service-industry worker" off the "street" is being told to do that 100 times? Yeah, right. Joke number three is the funny one.

I don't doubt that such a theft-replacement can happen, I won't even doubt it DOES happen, and I don't even doubt that professionals aren't using this on a daily basis. I just don't believe for a second that this is the major sensation the article makes it sound and that service-industry workers are being recruited to do this on a "not unusual" basis!

And someone is going to all this trouble to perpetuate "bottom feeder" fraud like gas pumps and convenience stores? (Joke number four)

Okay, so you're thinking: what's to stop a professional criminal from getting the card, reading it, replacing it, duplicating it, and then posing as a legitimate business to obtain the real name of the holder, and the last four digits of his card number (as well as an approval code) and then using that data or selling it to organized crime? Nothing, except the card company's standard controls on vendors. I don't doubt that someone somewhere might be doing this. But why go to this much trouble? If it's so easy to corrupt service-industry people, why not get a couple of the girls at Pizza Hut or Red Lobster or any other "service-industry" employees with legitimate access to credit cards to do this? Why isn't the article warning us to not give our credit cards to ANYONE, even the waitress or parts clerk at AutoZone? And what's to stop the Wal-mart programmers from capturing our data from their computer? Why does the article think that hotel key cards in the possession of Las Vegas street criminals are such a big deal? Joke number five perhaps?

And as the icing on the cake, the article sounds like a publicity stunt for the "experts" who are trying to sell the "pen like device" that ... seems to me ... to be attempting to do what biometrics is better at doing already: "There is still a need for on-the-spot validation of credentials where you have a convergence of emergency workers, many of whom have never seen each other before," he said.

Perhaps the "Joax on me"?

A few musings from a perpetual media skeptic... (who nevertheless finds the media very entertaining -- funny jokes abound if you look for them)

David Fordham

Another message from David Fordham

Bob, I was going over to our tech department on another errand, and for fun, I stopped by and asked them to scan my Visa card through a reader. (Our university ID is a 'smart card' and students can use it like a debit card, etc., ergo there are card readers all over campus! The tech support department services them and has readers lying around the office. We connected one up and read my card.

As I expected, the data on my Visa card came out complete gibberish. A long string of numbers, none of which I could recognize as being anything real: card number, bank number, expiration date, zip code, anything. The tech told me what I already knew: the data is encrypted, padded, reversed, check-digits added out the wazoo, interspersed, interlaced, etc.

When I told him why I was interested in this, the technician came up with another reason why he, like me, believes the article is something of a "joax":

The technician referred to something called the "physical resolution" of the magnetic stripes. My credit card holds at least 2048 characters of information (that's how many the reader picked up, anyway). Hotel key cards have to hold far less information. Hotel cards are generally much cheaper cards, and the quality of manufacture is much lower. It is his opinion that you probably would have a hard time encoding a hotel card with the character density required by a legitimate credit card. (The bpi, or bits per inch, which determines resolution is something like the magnetic equivalent of a pixel-count for a digital photo.) He said that encoding a hotel key card with the data from a credit card would be like trying to reproduce DaVinci's Last Supper using the 16-color 240x120 screen resolution of a cell-phone display.

He also pointed out that the magnetic stripes are not a universally-agreed-upon-standard. The physical location of the hotel stripe may be in a different location on a key card than it is on a credit card. Add in the multi-layer magnetic effects (analagous to different tracks on an 8- track tape cartridge of days gone by), etc., and you end up with a set of complicating factors that makes him as skeptical as I am about the magnitude of the problem. "People have been trying this for years ... gluing the old magnetic tape to credit cards, and stuff like that. These reporters must think the credit card company security people are real dummies. In addition to the stuff you can think of on your own, the credit card companies are full of surprises and stuff you don't think of!" I'm paraphrasing him here. "Forgery is an old problem, and the credit card has evolved a long way. Every time your card expires and they send you a new one, there are new security features in place, embedded in the card in places you'd never think to look. Copying data from one card stripe to another is a gimmick that hasn't been workable for years."

He said that the 'service industry personnel' referred to in the article are probably waitresses and others with legitimate access to cards, but like me, he believes any problem is overblown and not worth worrying about... he, like me, agrees that putting the 'read' information to use requires a lot more sophistication than the 'street criminals' are able to muster. Yet.

I ended our conversation by reminding him that newspapers are in business to sell papers, not educate the public.

When I asked the tech if I could paraphrase his comments, he said yes, but he'd appreciate not having his name used. I'm not a fan of anonymity, but I respect his wishes.

David Fordham

Bob Jensen's threads on consumer fraud are at

"The Secret To Google's Success: Its innovative auction system has ad revenues soaring," Business Week, March 6, 2006 --- Click Here

Everybody knows that Google Inc.'s  innovations in search technology made it the No. 1 search engine. But Google didn't make money until it started auctioning ads that appear alongside the search results. Advertising today accounts for 99% of the revenue of a company whose market capitalization now tops $100 billion.

Now, research is showing that Google's auction methodology, invented internally and so important for its success, is far more innovative than auction experts once believed. While superficially similar to earlier types of auctions, it is a "novel mechanism" that "emerged in the wild," write the authors of The High Price of Internet Keyword Auctions, a new study by Benjamin Edelman of Harvard University, Michael Ostrovsky of Stanford University, and Michael Schwarz of the University of California at Berkeley. Google's AdWords became so successful after its debut four years ago that some of its key features were quickly adopted by Yahoo! Inc. (YHOO ), then the search-ad leader.

MATHEMATICAL RIGOR Close-mouthed Google has opened up about AdWords since the three economists cracked its code last November. It freed Hal R. Varian, a Berkeley economist who consults for Google, to publish some of his findings about the auction methodology. And on Feb. 22, Google gave an interview to BusinessWeek in which for the first time it named the technical leader of the project: Eric Veach, a veteran of Pixar Animation Studios whose Stanford doctorate was in computer graphics, not economics. "Without his mathematical rigor we wouldn't have been able to do it," said vice-president of product management Salar Kamangar, himself a biology major, who was Employee No. 9 at Google and led the nontechnical side of the project.

Some of Google's innovations are only now being matched. For instance, Yahoo gives the top spot on its search results page to the advertiser who pays the most per click. But Google maximizes the revenue it gets from that precious real estate by giving its best position to the advertiser who is likely to pay Google the most in total, based on the price per click multiplied by Google's estimate of the likelihood that someone will actually click on the ad. Anil Kamath, chief technology officer of Efficient Frontier Inc., a search-engine marketing firm in Mountain View, Calif., estimates that Google earns about 30% more revenue per ad impression than Yahoo does. Kamath says Yahoo is likely to follow Google's lead soon. Asked about that, a Yahoo spokesperson says the company is "currently evaluating" making more use of the "click-through rate" in placing ads. Last fall, Microsoft Corp.'s  MSN embraced Google's approach, tweaking it to increase ads' relevance, when it began auctioning search ad space.

What makes Google's auction so different? Auctions come in two main flavors. In a typical first-price auction, participants put in sealed bids, then the winner pays his or her bid. But the danger is the high-bidder ends up regretting having won, an effect known as the winner's curse. A second-price auction lessens winner's curse because the highest bidder gets the prize but pays only the minimum necessary to win, namely the second-highest bid, plus perhaps a penny.

Kamangar, Veach, and colleagues chose a second-price auction. But not knowing theory, they designed one that differed in a key respect from the one economists had studied. In the economists' version, bidders always have the incentive to tell the truth. In Google's auction they don't, say Edelman, Ostrovsky, and Schwarz, since in some cases, by understating the top price they're willing to pay, advertisers could get a slightly lower position on the search page for a lot less money. They conclude that naive advertisers who told the truth could overbid. Google's system has pluses for advertisers, too, says Varian. It's easier to understand than the academic version. And it's proven to work on a large scale.

AdWords Select, as it was called at its February, 2002, debut, was actually Google's third crack at an ad auction. The first two were flawed, but Google founders Larry Page and Sergey Brin kept pushing. Even the current system isn't perfect. Advertisers complain that it's too much of a "black box." Still, if the best measure of innovation is commercial success, Google's AdWords was a grand slam. Says Kamangar: "Third time's a charm."

"Shopping List These Studies of consumer culture are priceless," by Paco Underhill, The Wall Street Journal, March 4, 2006 ---

1. "Bobos in Paradise" by David Brooks (Simon & Schuster, 2000).

Good books about popular culture can make us feel as if we are looking in a mirror from a different angle--as David Brooks proved with his brilliant dissection of "bourgeois bohemians" in "Bobos in Paradise." Many of us who grew up in the 1960s fully enjoyed the freedoms of that era; even though we might have scoffed at respectability back then, our later transition to it seems to have happened quite naturally. We excuse our indulgences in Starbucks by telling ourselves that, after all, it was a soy latte. Old hippies can vote Republican, drive SUVs, live in McMansions and still love "The Rocky Horror Picture Show." These inconsistencies have never been better captured than they are in "Bobos."

2. "Cheap" by David Bosshart (Kogan Page, 2006).

In the 1920s, Gottlieb Duttweiler founded the Swiss grocery-store chain Migros--and was known from then on as the man who invented über-discounting. He died in 1961, but Duttweiler's legacy endures in the form of the Gottlieb Duttweiler Institute, or GDI, located outside Zurich. A think tank dedicated to merchant education and research into retail best practices, GDI runs two annual high-powered gatherings, one on retail matters, the other on food service. The events' focus, increasingly, is on the explosive growth of shopping and retail across Russia and Central and Eastern Europe. GDI's executive director is David Bosshart, a distinguished political scientist. His book, "Cheap," points out that the fastest-growing merchants in the First World are mega-discount chains such as Aldi in Germany (owners of Trader Joe's) and Dollar Store in the U.S. David's main themes: Consumers' pursuit of bargains is a victory over the system, and nowadays cheap is chic. A number of books lately have looked at the impact of cutting costs in the supply chain, but it takes a Swiss German to say it elegantly and globally.

3. "Not Buying It" by Judith Levine (Free Press, 2006).

Most of us could live the rest of our lives on fruits, vegetables, pasta, wine, olive oil and yearly doses of socks and underwear. In truth we need little. Judith Levine, in "Not Buying It," tries with her significant other to spend a year off the shopping grid as they move between their homes in Brooklyn and Vermont. The story swings from asking how crucial Q-tips really are to exploring the fine line between shopping as therapy and shopping as sickness. This is a charming book about trying to live small, and it is a fair-minded look at the "simply living" movement.

4. "FutureShop" by Daniel Nissanoff (Penguin, 2006).

I was not prepared to like "Futureshop" by Daniel Nissanoff. Books about e-commerce tend to be like uninspired sex: a convenient shortcut to a nap. But this one is like the jolt of a double espresso. Who knew that secondary markets could be so interesting? In Daniel's view, eBay is creating an "auction culture" that is transforming the way we shop on- and offline. After all, when a used car is transformed into a "preowned" Lexus, secondhand status has lost all its stigma. Lee Scott, the CEO of Wal-Mart, is quoted as having no concerns about the threat of Target, but eBay keeps him up at night.

5. "Design for Effective Selling Space" by Joseph Weishar (McGraw-Hill, 1992).

Magic in the retailing realm is not what you sell but how you sell it. From shop windows to catalog photo shoots to the design of an e-commerce site, we live in a world where our visual language is evolving faster than the spoken or written word. Our eyes may be tired, but their connection to our brains has never been better. In retail, making good stuff look great is called Visual Merchandising, or VM, and the master historian of VM is Joseph Weishar. Joe's gift is an ability to connect fine art and commerce. His slide lectures--this Tiffany window, that assemblage box by Joseph Cornell--are legendary (having a voice like Vic Damone helps). Joe has a new book called "The Aesthetics of Merchandise Presentation," but "Design for Effective Selling Space" is his classic. My copy, bought used, came complete with coffee stains and Post-it notes--the ultimate testimony to a book's worth.

Mr. Underhill is CEO of Envirosell Inc. and the author of "Why We Buy" and "Call of the Mall."


Formal Comparison of Accounting Software Packages

March 1, 2006 message from David Fordham, James Madison University [fordhadr@JMU.EDU]

Ruth Bender asked: "...more broadly, how should she start looking for the right package?"

One of the best tools I've ever come across for evaluating commercial accounting software packages is called "The Accounting Library", by a company out of Richmond Virginia called "Solutions, Inc."

The Accounting Library software covers well over 150 different commercial accounting packages. It includes ALL levels of software, from Quickbooks (at the very bottom of the product line), all the way up through SAP (the top). While 150 doesn't sound like a large number, believe me, it has everything you've ever heard of, and more.

What you do is, you answer a set of questionnaire-like questions dealing with the nature of your business and what you want your accounting package to do for you. The questionnaire can be quick-and-dirty, or extremely complex, depending on whether you are evaluating on behalf of Mom-And- Pop's Hotdog Stand, or Boeing Aircraft Corporation. You can spend weeks answering the full questionnaire if you want to. yes, it covers currency conversions (about 90 ways to Sunday as they say), analysis of just about everything (sales, costs, by product, by client, by sales rep, by the kitchen sink, etc.), and just about anything else you can think of.

After telling The Accounting Library about your business nature and what you expect the accounting package to do for you, TAL will then rank those products which meet or come close to your specs. You can then "drill down" into the ranking to find out WHY one package was rated higher than another, to find out which features you need that are or are marginally met in each package, etc. You also have the opportunity to reconsider your initial answers -- for example, during the drill-down exercise, you may decide that perhaps keeping track of subassemblies by date-manufactured isn't quite as important as you originally ranked it, or that maybe you need to generate an "aged inventory by serial number" report after all. You can then alter your original input, and re-run the evaluation.

I used TAL back when I was teaching the systems analysis classes, because it walks the students through a good "user needs analysis"... albeit in checklist form (I had to add a lot of meat to explain rationales, etc. and thus I used TAL as a support tool rather than a concepts tool.)

What's more, the product has a fantastic "introduction to accounting software", gives product descriptions and summaries of capabilities, etc. -- in general it's just a fantastic learning tool for comparing the many commercial- grade accounting packages out there.

The latest editions are also aimed at consultants who help companies procure and install software.

You might want to investigate TAL for your friend. The website is: 

If you decide the product is useful, telephone (U.S.: 1-804- 330-0000) and ask for Charles Chewning, and tell him that David Fordham of James Madison University told you about the product. No, I don't get a finders fee or commission, but he is a supporter of JMU (and the AIS educator's association too!) and might give you a discount on the product if he knows you found it through us. (It's a steal at full price, but hey, every few dollars helps!)

David Fordham
James Madison University

March 1, 2006 reply from Roger Knights [roger.knights@AUT.AC.NZ]

In New Zealand we have a very versatile package called "MYOB" - or: Mind Your Own Business. We use it here for tuition, and a number of us with clients also use it. I know from practice that it meets all the criteria you mention with the EXCEPTION of forex (not too sure about this). I can conceive how it might be handled fairly easily with a link from Excel, as I have linked depreciation schedules (in Excel) directly into MYOB. There are a number of web pages to check it out: just google "MYOB". Let me know how you get on?

Regards, Roger Knights
Senior Lecturer
Auckland University of Technology (00649) 921-9999 ext 7055

March 2, 2006 reply from Bob Jensen

Hi Ruth,

There are some accounting and small business software comparisons at 

Especially note the link to the relatively new AICPA IT Center --- 

Also note the Freeware Guide ---

Bob Jensen

March 2 additional reply from Bob Jensen

People looking for accounting and management software often forget about the wonderful Webledger alternatives where a heavy duty IT system is maintained in a central location by the software system vendor such that  users can access the system on the Web and do not need their own hardware, software, and expensive maintenance technicians. Webledger systems have excellent backup computer and power systems such that the chances of going down are almost zero except in nuclear war.

My favorite Webledger alterntive is NetSuite at
NetSuite commenced under the name NetLedger with financing from the CEO of Oracle. For all practical purposes it is an Oracle company.

Bob Jensen's Threads on Webledgers for Distributed Network Computing of Accounting Systems and Business Services
The above site is not one that I actively update. Hence, some of the links may be broken and there may have been some buyouts and mergers that I've not tracked in the past year or two.

Bob Jensen

March 2,, 2006 reply from Bob Jensen

At 6:43 a.m. this morning I sang the praises of NetSuite in the message below. As chance would have it, at 2:30 p.m. this afternoon I ran across the following tidbit from the Accounting Web:

"NetSuite Named Top SMB Business Application Suite," AccountingWeb ---

NetSuite, Inc. leads the rankings of on-demand business management software for small and mid-sized businesses (SMBs) according to a new study of SMB business suites from Yankee Group. NetSuite received, or tied for the highest ranking in all categories ranked by the study including breadth of solution, market share, geographic coverage and ease of customization.

“SMBs require an easy-to-use, integrated business application suite," Sanjeev Aggarwal, Small and Medium Business Strategies Senior Analyst and leader of the Yankee Group survey states. “Such solutions can help improve personalization and the customer, supplier, partner and employee experience.”

Study results indicate that small and mid-sized enterprises are currently experiencing the same business application transition, from cobbled together, stand-alone software solutions to and integrated suite to manage core business operations, recently completed by Fortune 1000 companies. The top three technology challenges facing SMBs all involved the difficulty in integrating and managing multiple stand-alone products for finance, ERP, CRM and E-commerce, according to 2005 SMB Business Applications and Web Survey conducted by Yankee Group in November 2005.

“The same ‘point application vs. integrated suite of applications’ battle that was fought in the enterprise is now happening in the mid-market, and it is pretty clear that an integrated suite of applications will win the SMB market as well,” Said Zach Nelson, CEO of NetSuite. “The combination of an integrated suite of business applications delivered as a service via the Internet is the ‘killer app’ for SMBs.”

The study also identifies the growing need for on-demand solutions in the SMB market. As small and mid-sized businesses don’t have the financial or human resources to manage complex on-premise applications, they are seeking on-demand offerings to reduce costs and increase productivity. Of the vendors studied, only NetSuite offers an integrated suite of web-based applications. The offerings from both SAP and Sage are designed as on-premise solutions. NetSuite enables companies to manage all key business operations, including CRM; customer support; accounting and payroll; warehousing and product assembly; web store and web presence; and employee productivity, in a single, integrated system that is delivered as an online service.

March 2, 2006 reply from David Fordham, James Madison University [fordhadr@JMU.EDU]

The Achilles heel (or the weakest link, for the modern generation) of Web-Based Information Systems is the internet infrastructure.

Most small and medium businesses of my acquaintance (those most likely to outsource their information system to a web- based vendor) are not served by hardened, robust, redundant ISP lines, but rather are reliant on a single (and very vulnerable) delicate link for their Internet service.

I have no doubt at all that NetSuite and the other major web- based applications providers have well-designed, safe, secure, backed-up, redundant, robust, multi-layered internet service lines coming in. But I think you'd be hard-pressed to say the same about the "last mile" of the infrastructure to the small and medium businesses.

A backhoe cuts the underground cable. A traffic accident knocks down the pole holding the cable company's coax. A heavy thunderstorm floods a DSL digipeater box. Lightning takes out the ISDN tombstone. The yahoo six blocks down cuts through the lines while installing his invisible dog fence. The contractor installing the new sewer line to the new condo complex cuts through the fiber-optic backbone to the shopping center. The phone company upgrades their equipment and suddenly everyone served by the C.O. is offline for the rest of the day.

Been there. Done that. All of it. And more.

For most of us, these are inconveniences. I can wait till tomorrow to make my Marriott reservation or check my bank balance or purchase that TNC on e-bay.

For a business, however, even a little of this and -- poof. A Monday-afternoon-till-Wednesday-morning Internet outage has more effect than waiting five minutes for a reboot of your local information system after the blue-screen-of-death from a Windows-based Accounting System failure. My mother- in-law even continues serving the customers in her store when the power is out, thanks to a UPS on the computerized cash register.

Of course, all companies should have a backup information system for mission-critical apps anyway, even with local systems. However, I'd bet most don't. I know most don't. So based on how frequently internet service goes down to us non-redundant-line ISP customers, I hope that NetSuite and its competitors are being honest with customers and making sure they have contingency plans in place for Internet outages before they agree to take over their InfoSys functions.

Another tuppence worth of tripe from...

David Fordham, CPTC
(certified pro-tech curmudgeon)

March 2, 2006 reply from Bob Jensen

Hi David,

Actually the proof is in the business success of the NetSuite Business Model. NetSuite would not have endured for so many years and not have won so many prizes worldwide if something was not working well.

I think you are being a bit unfair in terms of the odds of breakdowns. I think the main selling point of NetSuite is the added security.

For a medium to small size firm the odds of a system failure in your own accounting IT system are relatively high unless an enormous amount is spent on backup systems and a highly qualified IT staff to keep the system running and recovering in case of failure. Such a system of hardware, software, and expertise is very expensive if you want to keep the odds of disaster low.

There is also a reasonably high probability of error and fraud in your own IT system because in a small system a great deal relies upon one or a very small number of technicians running the system. Even if there is no fraud, the loss of a key IT employee may throw the entire system into a dither.

For an online system like NetSuite the odds of a failure on NetSuite's end are minimal because of the massive investment in backup systems and very highly trained database experts. NetSuite even managed not to have one outage when there were a string of California power outages during the Enron rip off of California in the 1990s (years when even PG&E was on the brink of bankruptcy). Remember the rolling blackouts across all of California. NetSuite had its own power generators to cover such contingencies.

It is true that there is a possibility of a cable breakage in the last mile to your home or business. However, these are usually restored fairly quickly and there is virtually zero risk of losing any data that has already been shipped to NetSuite.

Actually the proof is in the business success of the NetSuite Business Model. NetSuite would not have endured for so many years and not have won so many prizes worldwide if something was not working well.

Bob Jensen

Bob Jensen's threads on accounting software are at

From The Wall Street Journal Accounting Weekly Review on March 10, 2006

TITLE: Troll Call
REPORTER: Bruce Sewell
DATE: Mar 06, 2006
TOPICS: Accounting, Intangible Assets

SUMMARY: The author describes issues on both sides of patent disputes, based on his experience as general counsel for Intel Corp., and relates them to the patent infringement suit settlement by RIM.

1.) What have been the events leading up to RIM (the company behind BlackBerry hand held devices) paying $615 million to NTP? On what basis has that amount increased over time? You may refer to the related articles to get a sense of that issue.

2.) What are the accounting issues related to intellectual property? List all that you can think of. How are these issues related to patent rights and disputes as described in the article?

3.) How has RIM been accounting for the cost of defending against the patent infringement suit by NTP? Determine the answer to this question based on information in the second related article.

4.) What are the author' s proposals for reforming patent infringement law?

Reviewed By: Judy Beckman, University of Rhode Island

TITLE: BlackBerry maker Agrees to Settle Patent Dispute
REPORTER: Mark Heinzl
ISSUE: Mar 17, 2005

TITLE: BlackBerry Case Could Spur Patent-Revision efforts
REPORTER: Mark Heinzl
ISSUE: Mar 06, 2006

"Troll Call," by Bruce Sewell, The Wall Street Journal, March 6, 2006; Page A14 ---

RIM, the company that brings BlackBerry service to four million subscribers, finally caved in to the threat of losing its business. It paid NTP, a small patent holding company reputedly comprised of just one inventor and one patent lawyer, $615 million to settle a four-year patent dispute. For NTP it was like winning the lottery, but for the rest of us, and for business in particular, it stinks. NTP used the patent system, and the threat of shutting down BlackBerry service, to play chicken with RIM and millions of BlackBerry users around the world. Unless the courts or Congress do something to stop this kind of gamesmanship, we're only going to see more cases like this.

NTP doesn't have a competitive product. It isn't even in the business of making products. It's one of a large number of companies known as patent trolls. Trolls acquire and use patents just to sue companies that actually make products and generate revenue. A patent without a product isn't worth much, whereas a patent tied to a revenue stream, particularly someone else's, is a whole different matter. RIM was the best thing that ever happened to NTP, because by last Friday the only question left was how much of RIM's pie NTP could get.

The distressing part of this picture is that RIM's contribution of complementary technologies, business acumen, product R&D and marketing is what "enabled" the NTP invention to achieve commercial relevance. The right question is: What would be a fair royalty for NTP, given its contribution of the patent and RIM's contribution of everything else? Unfortunately, that isn't where this case ended up. Because NTP had the presumptive right to obtain an injunction against RIM and stop it dead in its tracks, the issue on the table wasn't the value of NTP's patent in the context of RIM's business; instead, it was the total value of RIM's business. "Pay me a lot or lose everything" hardly leads to rational settlements. Is this really what we want from our patent system?

At Intel, I see this problem every day and from both sides of the fence. Intel owns a considerable portfolio of patents and we believe strongly that inventors are entitled to fair compensation for their efforts. But Intel is also a target for patent trolls because we run a successful business. The fact that success creates leverage for trolls to extract value above and beyond the true contribution of the patented invention just doesn't seem quite . . . American.

Things got so lopsided in the world of patent litigation not on account of the patent statute itself but from case law, which has become increasingly protective of patent owners and tolerant of excessive damages arguments by plaintiffs' lawyers. Our patent laws are supposed to be about proliferation of technology. If there is actual competition between patent owner and infringer, an injunction may be appropriate -- it protects the patent owner's right to exclusivity and does not deprive society of the benefits of the technology. On the other hand, if the patent owner has not commercialized the invention, blocking others from using it is a loss for all of us. The right to an injunction also needs to be tempered by a commonsense look at how much real value the patented technology adds to the whole commercial product. A fundamental invention deserves greater value than a relatively minor tweak to work that went before it. A broad application of the injunction remedy makes all patents "crucial," whether they are or not.

What I'm suggesting here is not all that radical. These concepts are already embedded in our patent laws; but unfortunately they have been buried beneath the wrongheaded notion that all patents should be treated equally.

There is a glimmer of hope. The Supreme Court will hear eBay v. MercExchange, in which eBay faces the threat of an injunction from MercExchange, a patent-holding company without a competitive product in the online auction space. The eBay case is an opportunity for the highest court to take the judiciary back to the language of the patent statute and remind judges that they don't have to grant injunctions in every patent case. Judges have the right to balance the interests of patent plaintiffs with those of the defendant, and society at large. It may be with just a touch of irony that we'll read about the eBay case on our now more costly BlackBerries.

Bob Jensen's threads on accounting for intangibles are at

From The Wall Street Journal Accounting Weekly Review on March 10, 2006

TITLE: Beyond AT&T, Larger Issue Is How to Play Convergence
REPORTER: James B. Stewart
DATE: Mar 08, 2006
TOPICS: Accounting, Advanced Financial Accounting, Mergers and Acquisitions

SUMMARY: The article covers issues related to the AT&T acquisition of BellSouth that can be used in classes covering accounting for mergers and acqusitions, particularly to focus on investor perspectives towards M&A transactions. The related articles are the front page announcements of the transaction.

1.) What is the purpose of the AT&T acquisition of BellSouth? How is the transaction structured? How is the $67billion acquistion price determined?

2.) What factors lead the author to say that "the deal has unfolded in textbook fashion"? Why did AT&T shares drop about 3.5% upon announcement of the transaction? Why did BellSouth's shares jump 10%?

3.) The author states that he likes the all stock structure of the acquisition. So why is AT&T announcing plans to buy back shares of stock at the same time that it is announcing a plan to issue shares of stock to undertake the acquisition? What is the ultimate effect of the is combination of transactions on the balance sheet? Why not just purchase the BellSouth shares for cash instead?

4.) How does this plan allay fears of "earnings dilution"? In your answer, define the term "earnings dilution."

5.) What are the concerns of regulators regarding this transaction? How are circumstances in the telecommunications competitive environment different than they were when AT&T was broken up in 1984?

Reviewed By: Judy Beckman, University of Rhode Island

TITLE: A Reborn AT&T to Buy BellSouth
REPORTER: Dionne Searcey, Almar Latour, and Dennis K. Berman
ISSUE: Mar 06, 2006

TITLE: Pact Represents Gample Regulators Will Accept a New Telecom Giant
REPORTER: Anne Marie Squeo and Amy Schatz
ISSUE: Mar 06, 2006


March 22, 2006 message from Ruth Bender [ ]

Hi Bob

I wonder if you could help me. I received a request from a PhD student who is looking at corporate hedging choices, earnings management, etc. We were discussing the issues with accounting that Fair Value causes, now that European companies have to follow IFRS. But he had one very specific question:

Finally, I wanted to find out whether you could kindly assist on a technical hedge accounting question. For my research I am trying to determine whether I can get/ measure the extent to which firms (in the US for this matter as IAS 39 is newly enacted), adopt hedge accounting. Is there a way that one could observe or proxy the extent of hedge accounting?

Do you know whether/how this information would be available?

Many thanks Ruth

Dr Ruth Bender
Senior Lecturer in Finance
Cranfield School of Management Cranfield

March 23, 2006 reply from Bob Jensen

Hi Ruth,

I know of no nationwide study of the extent of hedge accounting in the U.S. Disclosures within annual reports vary in quality. One pretty good example of disclosure is in the U.K. ---

Usually firms try to get hedge accounting relief (on eps) whenever they can qualify for hedge accounting when adjusting derivative financial instruments to fair value. It is not a matter of a firm electing to use hedge accounting or not use hedge accounting. It is a matter of electing to use hedge accounting for each derivative contract used as a hedge. In the U.S., portfolios seldom qualify for hedge accounting such that a firm is often individually analyzing thousands of hedging contracts.

Certain types of derivatives have a hard time qualifying for hedge accounting. Options in particular often fail to meet requisite hedge effectiveness tests and can only qualify for hedge accounting to the extent of changes in intrinsic value but not time value. Interest rate swaps often do not match up properly (with hedged items) for hedge accounting.

Since qualifying for hedge accounting is such a fluid event (into and out of qualifying over time), I doubt that any highly aggregated statistics on what proportion of hedging derivatives qualify for hedge accounting would have much meaning.

And there is the problem of error. Many U.S. firms that took hedge accounting are now in the process of revising financial statements because they discovered ex post that they did not qualify for hedge accounting.

And there is a serious problem that some firms have elected to use FAS 133 as an earnings management tool because it is so easy to fool the auditors.

Some comments the Public Company Accounting Oversight Board, which regulates auditors, has made in its recent inspection reports of big audit firms. In a few instances, the PCAOB has indicated that firms haven't been as diligent as they should have been on hedge accounting in individual audits that the board has reviewed. In an inspection report on KPMG LLP issued in September, for instance, the PCAOB cited an audit of an unidentified client in which KPMG "failed to appropriately address" improper derivatives accounting. A report on Grant Thornton LLP last week said the firm "failed to perform sufficient audit procedures" over one client's interest-rate derivatives and didn't evaluate another's hedge accounting over foreign-currency futures.
"Hedge Accounting Gets On Regulators' Radar:  Some Firms Using the Tool Have to Restate Earnings; The New Lease Accounting?" by Michael Rapoport, The Wall Street Journal, January 27, 2006; Page C3

And lastly there is the enormous problem that firms are taking hedge accounting when they really do not qualify for hedge accounting. FAS 133 is so complex that many firms are running inappropriate tests for effectiveness without realizing that the tests being used are inappropriate. For example, they might be running the test on cash flow effectiveness of hedges when FAS 133 is adamant that the tests have to be run on changes in value such that even perfect cash flow hedges often fail the value tests for effectiveness (particularly with options contracts).

I have some threads on ineffectiveness testing under the term “Ineffectiveness” at

Earnings Restatements Due to FAS 133 on Hedge Accounting

"Hedge Accounting Gets On Regulators' Radar:  Some Firms Using the Tool Have to Restate Earnings; The New Lease Accounting?" by Michael Rapoport, The Wall Street Journal, January 27, 2006; Page C3

A year ago, companies were rushing to restate their earnings because of problems with how they accounted for lease obligations on their stores and plants. Something similar may be happening with the bookkeeping for financial instruments that some firms use to guard against risk.

In 2005, at least 40 companies, from small banks to conglomerates like General Electric Co., restated past earnings because of problems with "hedge accounting," according to a new report from research and proxy advisory firm Glass Lewis & Co.

And more such revisions could be on the way. "I don't think it's really over," says Jason Williams, a Glass Lewis analyst who noted in the report that these restatements may show "a pattern similar to the recent lease-accounting restatements."

So far, the hedging moves are only a fraction of the hundreds of lease-accounting restatements. And there has been no high-profile warning from the Securities and Exchange Commission about the need to shape up on hedge accounting, as was the case with lease accounting.

But a number of smaller indications -- a recent comment in an audit firm's inspection report, a speech by an SEC staffer -- suggest that regulators may indeed be pushing companies and their auditors to clean up hedge accounting.

Hedge accounting is complex, but the goal is easy to understand: When a company uses derivatives to hedge exposure to risks like changes in interest rates and fluctuations in foreign currencies, it wants those derivatives to qualify for hedge-accounting treatment under accounting rules because any changes in the derivatives' value can be excluded from current earnings. The value changes are "smoothed" into earnings over time. Without that special accounting status, the derivatives' ups and downs would make earnings unpredictable, which companies and shareholders dislike.

To qualify for hedge accounting, however, companies have to meet a strict set of criteria. And dozens have discovered lately that either they haven't fully complied or have cut corners they shouldn't have. Some have found their hedges don't do the job they're supposed to in offsetting the changes caused by the risk they're hedging. Others don't have sufficient documentation for their hedges.

In such cases, a company typically is disqualified from using hedge accounting, and it has to restate earnings to add back in the changes in the derivatives' values -- often boosting earnings in some periods but lowering them in others.

Last fall, for instance, brokerage TD Ameritrade Holding Corp. restated earnings lower for fiscal 2003 and higher for fiscal 2004 and 2005 over documentation issues. In December, finance company CIT Group Inc. restated first-half 2005 earnings higher and third-quarter earnings lower because it used the shortcut when it shouldn't have. Representatives for both companies couldn't be reached to comment.

Many companies have said they decided to restate on their own or in consultation with auditors. Yet regulators have been voicing concern about the matter as far back as 2004, when the SEC said it had seen instances of "aggressive interpretation" of hedge-accounting rules, and cases in which companies "have not been diligent" in satisfying the requirements.

And at least a couple of the restating companies say they've had contact with regulators over hedge accounting. TD Ameritrade said it held discussions with the SEC before making its restatement in November. And the SEC is investigating GE over its hedge accounting. But Russell Wilkerson, a GE spokesman, says the company was already in the process of finding its hedge problems through an internal audit before it heard from the SEC.

One small sign that regulators are concerned over hedge accounting: Some comments the Public Company Accounting Oversight Board, which regulates auditors, has made in its recent inspection reports of big audit firms.

In a few instances, the PCAOB has indicated that firms haven't been as diligent as they should have been on hedge accounting in individual audits that the board has reviewed. In an inspection report on KPMG LLP issued in September, for instance, the PCAOB cited an audit of an unidentified client in which KPMG "failed to appropriately address" improper derivatives accounting. A report on Grant Thornton LLP last week said the firm "failed to perform sufficient audit procedures" over one client's interest-rate derivatives and didn't evaluate another's hedge accounting over foreign-currency futures.

A KPMG spokesman says the firm works with both regulators and clients to make sure clients apply accounting principles as regulators want "in an area where accounting practices continue to evolve." Grant Thornton couldn't be reached.

And in a speech last month, Mark Northan, an SEC professional accounting fellow, said some companies have used the "shortcut" to hedge accounting when they haven't met all the conditions for doing so.


Dirty Pooling in Accounting

March 29, 2006 message received by Bob Jensen

Hi Bob Jensen

Hope you don't mind another question.

I worked on Wall Street during the other tech mania (late 60's) which included the conglomerate craze. I know pooling-of-interest accounting was kind of tarred and feathered in the ensuing meltdown, but I was never too clear why that was so. I am still wondering why bogus goodwill is preferable to retaining the financial track record of the combined companies. Are you aware of what the actual objections to p-o-i are?

March 29, 2006 reply from Bob Jensen

Some investors are impressed by high ROI or ROE numbers. Keeping the denominator low with old historical cost numbers and the numerator high with future earnings numbers "inflated" ROI and ROE and made the mergers appear more successful than was actually the case.

There are other problems with "dirty pooling."

One of the best-known articles (from Barrons) was written by Professor Abe Briloff about "Dirty Pooling at McDonalds." McDonald's shares plummeted significantly the day that article was published ---

Actually, one of the arguments in favor of purchase accounting rather than pooling of interests is that in an arm's length transaction goodwill can actually be measured, unlike the pie-in-the sky valuations in a hypothetical world.

A summary of FAS 141 is given at

 The standard itself discusses a lot of both theory and abuses. In general, academics fought against pooling. About the only parties in favor of pooling were the corporations themselves.

Bob Jensen


Changes in Derivatives Accounting Are in the Wind
We might call this the Fannie Relief Ruling if it comes to “pass.”

If this happens it may be time to retire after having spent so much time learning the complex rules of the current FAS 133. Actually I have been arguing for this change in the accounting rules for some time. There will, however, be greater inconsistencies between accounting for hedges of financial instruments versus hedging of commodities such as fuel inventories.

From The Wall Street Journal Accounting Weekly Review on March 3, 2006

TITLE: Simply Put: Accounting Rule-Makers May Change How to Book Derivatives
REPORTER: James R. Hagerty and David Reilly
DATE: Feb 23, 2006

TOPICS: Advanced Financial Accounting, Derivatives, Fair Value Accounting, Financial Accounting Standards Board, Hedging, Historical Cost Accounting, International Accounting Standards Board

SUMMARY: The article reports on implications for derivative accounting from the FASB's proposal to implement a fair value option for financial assets and liabilities that was announced in January 2005. From the FASB's web site describing this proposed statement, one can learn that it would create a fair value option so that entities may irrevocably elect to report certain financial assets and financial liabilities at fair value and recognize changes in fair value in earnings. The election of the fair value option would be made on a contract-by-contract basis and would require separate line item reporting of the instruments accounted for at fair value. This change could simplify hedge accounting because the problems that currently arise in this area often stem from situations in which entities cannot comply with hedge accounting treatment criteria in FAS 133. Such non-compliance results in derivative instruments being accounted for at fair value with changes in value flowing through earnings while the hedged item continues to be accounted for under the historical cost model. As the FASB states in the Exposure Draft, "creation of the fair value option would permit an entity to mitigate that volatility by enabling entities to achieve an offset accounting effect for the changes in the fair values of related assets and liabilities without having to apply complex hedge accounting provisions." The option also would allow greater convergence with international accounting standards.

1.) The author states in the article that "hedge accounting aims to ensure that changes in the value of a derivative used to offset risks don't immediately flow through to earnings." Is that an accurate portrayal of the purpose of hedge accounting? If you believe so, support your answer. If not, provide what you believe is an accurate description of the purpose of hedge accounting. In either case, provide references to appropriate authoritative literature.

2.) Define the terms cash flow hedge, fair value hedge, and hedge effectiveness.

3.) In what case would a derivative instrument's change in fair value not flow through earnings each period? How would the instrument's change in value be accounted for?

4.) In what case, even after complying with current hedging treatment requirements, does a derivative's change in fair value flow directly through to earnings? What additional earnings impact also flows through at the same time?

5.) How does the FASB's proposal for a fair value option "obviate the need to use hedge accounting" as stated by Stephen Ryan, an NYU accounting professor, and quoted in the article? Does the proposal preclude the need for all hedge accounting treatments currently allowed under FAS 133? Explain. For further information on the FASB proposal beyond that offered in the article, you may access the FASB web site at to search for "fair value option" or access the proposal directly at

6.) What issues led to Fannie Mae's and GE's earnings restatements that are described in the article? For information about the issues associated with Fannie Mae, you may refer to the related article. Why do even positive earnings restatements cause concern in the marketplace regarding the reliability of financial reporting?

Reviewed By: Judy Beckman, University of Rhode Island

Although I had a tidbit about this in a previous edition of New Bookmarks, I will repeat it here for convenience.
"Simply Put: Accounting-Rule Makers May Change How to Book Derivatives," by James R. Hagerity and David Reilly, The Wall Street Journal, February 23, 2006; Page C1 ---

Fannie Mae and Freddie Mac for years complained that accounting rules distorted their earnings, needlessly confusing investors.

Now, U.S. accounting-rule makers are proposing a way to help those mortgage giants and other companies to simplify the way they account for complex derivatives that are often used to protect companies against swings in interest rates and other risks.

That change, if enacted, won't bail out top officers at Fannie and Freddie who lost their jobs in the past few years after trying to circumvent existing accounting rules. Indeed, Fannie is today expected to release the results of an internal investigation into its bookkeeping improprieties led by former New Hampshire Sen. Warren Rudman.

But with its proposal announced in late January, the Financial Accounting Standards Board is tossing a bone to companies that have struggled to cope with a complex rule known as Financial Accounting Standard 133. That rule sets out how companies book gains and losses on derivatives, such as interest-rate and currency swaps.

The Norwalk, Conn., accounting-rule maker isn't proposing to change FAS 133 itself; rather, the proposed rule provides a simpler way for companies to account for derivatives and the securities and other instruments they often hedge on a company's balance sheet. The rule would let companies use current market prices, also known as "fair values," for a wider variety of instruments than is now allowed, much as rules from the International Accounting Standards Board do.

Currently, companies must value some instruments at their market price and others at their historical cost, resulting in a balance-sheet mishmash. "We believe this will create an enormous opportunity for companies to simplify their accounting," said Edward Trott, a member of the FASB.

The change could also provide relief to companies forced to restate results because of problems with so-called hedge accounting they applied to derivatives, a FAS 133-induced headache that has afflicted a number of companies.

Sometimes these restatements actually improve past results, but that can still cause confusion for investors. Bank of America Corp. yesterday, for instance, said it will restate several years of earnings because the Charlotte, N.C., bank improperly applied a form of hedge accounting to transactions related to interest rates and foreign currencies. The restatement, along with changes to results for periods before 2002, will result in a gain to earnings of $345 million, the bank said.

Hedge accounting aims to ensure that changes in the value of a derivative used to offset risks don't immediately flow through to earnings. However, the criteria that allow derivatives to qualify for hedge accounting are complex, requiring extensive documentation and regular testing to guarantee that the hedge is actually doing its job. And the accounting itself is a hassle.

In 2005, at least 40 companies restated results because of problems with hedge accounting, according to a study by Glass Lewis & Co., a San Francisco research firm. Among them: General Electric Co., which last year issued a restatement that could increase earnings by $538 million, according to Glass Lewis.

Currently, if a company doesn't use hedge accounting and wants to protect itself against a swing in the value of a mortgage loan, it would have to carry the original cost -- accountants refer to it as the historical cost -- of the mortgage on its books while using the market value of the derivative instrument that hedges the mortgage.

The apples-to-oranges comparison resulting from this practice led to swings in earnings if a company couldn't use hedge accounting. At a company like Fannie, for instance, a move in interest rates could cut the value of a derivative, while at the same time increasing the market value of a mortgage. In that event, the company would take a hit on the derivative without being able to record the offsetting gain on the mortgage, which is accounted for at its historical cost.

Giving companies the option of using market values would obviate the need to use hedge accounting, said Stephen Ryan, an accounting professor and derivatives specialist at New York University. Firms could record both a derivative and the instrument it is hedging at their market values.

Changes in derivative-accounting standards are particularly important for Fannie and Freddie, government-sponsored companies that provide funding for home-mortgage loans. Both have long been heavy users of derivatives to guard against differences between the income the companies get from millions of monthly mortgage payments and the price they pay for borrowing in the bond markets.

In 2004, regulators found that Fannie had failed to take the steps needed to qualify for hedge accounting, among other accounting misdeeds. Those findings led to the ouster of the company's chief executive officer, Franklin D. Raines, and some top aides. Fannie Mae is now working on a restatement of past earnings.

Both Fannie and Freddie declined to comment on the FASB proposal.

Continued in article

Bob Jensen’s tutorials on FAS 133 and IAS 39 accounting standards are at

The CD that I hand out to my workshop audiences is available at

Fannie Mae Unearths More Accounting Problems
The new problems include improper accounting for certain investment securities and for some of the fees and obligations that arise from Fannie's guarantees of payments on mortgages bundled into securities and sold to investors world-wide. The newly disclosed problems also relate to accounting for the costs of dealing with houses acquired through foreclosures, for debt restructurings and for interest on delinquent loans, among other things.
James R. Hagerty, "Fannie Mae Unearths More Accounting Problems:  Company Expects to Meet Its Capital Requirements; Market Share Drops Again," The Wall Street Journal, March 14, 2006; Page A3 ---

March 29, 2006 message from Ira Kawaller

The latest posting is an article that was co-authored with Professor Timothy Koch (University of South Carolina), published in "Bank Asset/Liability Management," March 2006. It deals with the problem of managing interest rate risk when the assets or liabilities that are the source of the exposure are subject to early-redemption (i.e., prepayment risk).

Click on the link to the right to find the article on the home page.

Please feel free to contact me if you have any questions or comments that you might like to discusss.

Ira Kawaller

Links to this and other papers by Ira are provided at

KPMG Fraud Updates

"Judge Blasts Credibility of Ex-KPMG Ex," SmartPros, March 10, 2006 ---

A federal judge on Wednesday agreed that former KPMG accounting executive David Greenberg can be freed on $25 million bail in his tax fraud case - but he attacked Greenberg's character and vowed to ruin his family financially should he decide to flee.

Greenberg is not expected to meet strict bail conditions for at least several days in what prosecutors call the largest criminal tax case in U.S. history, a fraud that helped rich people evade $2.5 billion in taxes.

Even as he set bail, U.S. District Judge Lewis A. Kaplan described Greenberg as "an extremely skilled individual who spent his whole life trying to figure out how to hide the pea."

He was referring to a version of a deceitful street game known as three-card monte, in which a pea is moved among three cups and viewers are asked to guess where the pea ended up.

The judge said Greenberg's finances were in such disarray that it was impossible to figure out where his assets were and how much he was worth.

"I have no idea how much went in, came out and remains," he said.

The judge warned Greenberg's family members that if he flees, the court would make sure they "will be financially ruined and stripped of everything they have."

He added, "If they're willing to take that risk, I'm willing to take that risk of non-appearance."

He also required Greenberg to live in Manhattan and submit to electronic monitoring.

The judge said Greenberg spent his professional career "scheming how to protect other people's assets from the United States government."

Greenberg is charged in an indictment accusing 17 former KPMG partners and managers with devising and marketing fraudulent tax shelters that cost the U.S. Treasury $2.5 billion.

The indictment says the ex-KPMG executives teamed with a former partner at a prominent law firm and another defendant to defraud the Internal Revenue Service by filing false income tax returns and by concealing the tax shelters from the IRS.

The judge said he was particularly disturbed that Greenberg apparently forged the signatures of his ex-wife and his father on papers establishing a limited liability company holding assets worth up to $13 million. He noted that the government has alleged Greenberg boasted that he could flee with money he controlled in the names of others.

Greenberg has denied the allegations. His lawyers declined to comment after Wednesday's hearing.

KPMG is a worldwide network of professional firms providing audit, tax and advisory services, according to its Web site. It operates in 144 countries and has more than 6,700 partners.

Bob Jensen's threads on KPMG are at

One Case in Which KPMG is Not in Favor of Transparency

"KPMG Aims to Cloak Details of Client's Case:  Auditor's Settlement Offer Would Muzzle Targus Group Regarding Sanctions Order," by David Reilly, The Wall Street Journal, March 20, 2006; Page C3 --- Click Here

In trying to settle a lawsuit brought against it by a former client, KPMG LLP has proposed terms aimed at preventing other clients from learning the auditor was sanctioned by a judge in the matter.

KPMG has offered to settle for $22.5 million a suit filed against it by Targus Group International Inc., a California computer-case maker, according to a draft settlement proposal reviewed by The Wall Street Journal. Targus claimed the accounting giant was negligent in failing to detect alleged embezzlement by a former executive at the company. KPMG has disputed that claim.

The proposed settlement payout is small compared with the $465 million KPMG agreed to pay last year as part of a deferred-prosecution agreement reached with the Justice Department. That agreement, which helped the firm avoid a potentially catastrophic criminal indictment, related to KPMG's sale of questionable tax shelters.

But the nonmonetary settlement terms being proposed by KPMG to Targus underscore how big accounting firms are pursuing every means at their disposal to limit their litigation liability and curtail the ability of clients to bring cases against them. Other measures taken include terms that some auditors are writing into their engagement contracts that would limit the clients' ability to pursue legal action against them.

In the proposed settlement with Targus, KPMG wants details of the case sealed and wants Targus to ask the state judge who sanctioned KPMG to vacate, or overturn, that order, according to the settlement document. The order, filed last July, sanctioned KPMG for obstruction during pretrial proceedings, known as discovery, and fined it $30,000. The judge also instructed any jury hearing the case against KPMG to take into account the firm's failure to produce "requested documents in a full and timely manner." At the time, KPMG said that it complied with the judge's discovery orders and appealed the ruling. That appeal is pending in the California Court of Appeal.

Continued in article

"KPMG Settles Targus Audit Case," by David Reilly, The Wall Street Journal, March 29, 2006; Page C4 ---

KPMG LLP agreed to pay a former audit client $22.5 million as part of a legal settlement that also calls for a California judge to set aside a sanctions order imposed on the accounting giant last July, according to a person familiar with the matter and documents related to the case.

The settlement terms will allow KPMG to clear the legal record of a disciplinary action that could potentially be used against it by other parties who might sue the firm in the future. Orange County Superior Court Judge Geoffrey T. Glass sanctioned KPMG last summer for obstruction during pretrial proceedings.

The order emanated from proceedings related to a lawsuit brought against KPMG by former client Targus Group International Inc. The California-based computer-case maker sued the firm for malpractice, alleging KPMG's audit failed to spot alleged embezzlement by a former executive that cost the company as much as $50 million.

In settling the case, KPMG had proposed that Targus agree not to oppose a request for Judge Glass to vacate the sanctions order, according to a draft settlement proposal reviewed by The Wall Street Journal. The accounting firm also wanted records related to the case, as well as the sanctions order and its own appeal of that order, sealed, while precluding executives at Targus, or their attorneys, from speaking about or referring to the matter, according to the draft settlement proposal.

In a statement released yesterday, KPMG said: "The parties have reached a settlement. We cannot discuss the terms, which are confidential. We have settled the case to avoid more costly litigation." An attorney for Targus didn't return a call seeking comment. The company's general counsel, Michael Ward, was traveling outside the country and was unavailable for comment.

Continued in article

Also see "KPMG Case Takes Surprise Turn With Guilty Plea," AccountingWeb, March 29, 2006 ---

Bob Jensen's threads on the two faces of KPMG are at

March 20, 2006 reply from Scott Bonacker [aecm@BONACKER.US]

From the Bets-L discussion list on designing an ethics course, recommendation of topics to cover:

"Reputation Risk is regarded worldwide as the highest order risk that faces organisations. Reputation risk is the current and prospective impact on earnings and capital arising from negative public opinion. This affects an institution's ability to establish new relationships or services or continue servicing existing relationships. This risk may expose the institution to litigation, financial loss, or a decline in its customer base.

Reputation risk exposure is present throughout the organization and includes the responsibility to exercise an abundance of caution in dealing with its customers and the community and other stakeholders. The process of dealing with Reputation Risk needs to include prevention, protection, response and recovery strategies."

Scott Bonacker
Springfield, Missouri

"Billionaires & Accounting Scandals," AccountingWeb, March 21, 2006 ---

Philip F. Anschutz is a modest billionaire with an estimated wealth of only $6.4 billion. He is rated 89th in the current list in Forbes’ The World’s Billionaires. Before starting Qwest Communications in 1996, his father owned a contract drilling company and he bought his dad out in 1961, according to the Washington Post. After striking it rich in Wyoming and Utah’s oil fields, Anschutz moved into stocks and real estate.

He came to own most of the railroads in the West and laid fiber-optical cable along his rail lines, connecting them at central hubs in strategic locations in order to provide high-speed data and T1 services for businesses, according to Wikipedia. Qwest incorporated in 1996, then acquired LCI in 1997 and added residential and business long distance to their pallet of services.

And with all his success, he became the non-executive chairman of Qwest Communications International, Inc. after he stepped down as CEO in 2002. In 2002, the company he built also announced it had incorrectly accounted for optical-capacity revenue, between the years 1999 to 2001, to the amount of $3.8 billion, according to ComputerWire. This accounting scandal has not tainted his reputation.

George Soros is ranked 71st in Forbes’ The World’s Billionaires. In September 1986, George Soros was a very large investor in Harken Energy when it purchased Spectrum 7 that was our standing President George W. Bush’s ailing oil venture. Spectrum 7 specialized in selling limited partnerships, according to Wikipedia. In 1986, tax laws changed the tax status of these financial instruments that had generated liberal tax write-offs before the change.

George W. Bush was given an active membership on the Harken board and initially given an $80,000 yearly consulting contract that increased to $120,000 in 1989. Bush was given $500,000 in Harken stock and options valued at $131,250. According to Wikipedia, Bush acquired another $600,000 in Harken stock under the company’s Non-qualified Incentive Plan. Bush also received two loans, at below-market 5% interest, totaling $180,375. in 1986 and 1988. Harken stock was purchased with these loans and his Harken stock holdings were converted to stock options which Bush says were never exercised.

It was generally thought that Harken Energy was buying political influence by having George H.W. Bush’s son on their board, but this was confirmed by David Corn’s interview with George Soros. To Corn’s question, “…What was the deal with Harken buying up Spectrum 7,” Soros responded, “…We were buying political influence. That was it. He was not much of a businessman,” according to Wikipedia.

Carl Icahn is no.53 in Forbes’ The World’s Billionaires. He has earned his reputation as a corporate raider. He has been buying weak telecommunications companies and merging them into publicly held company XO Communications, of which he owns 61 percent, according to CorpWatch. In an odd transaction, XO Communications auctioned off their wireline businesses for $700 million to Carl Icahn, himself. Of the proceeds of the auction, $400 million will be used to retire the company’s long-term debt.

Some investors say that Icahn rigged the auction to start with and surprised everyone but himself when he emerged as the winning bidder. CorpWatch reports others are saying that Icahn may have lead the company into trouble in order to sweeten the deal for himself.

Andrew Bogen, an attorney for the minority XO shareholder R2 Investments, told CorpWatch, “It is inescapable that he used his dual position as debt holder and the guy who runs the company in a way that favors himself. We think Carl Icahn made all the important decisions about who was permitted to bid – and that he had full information on other bids when he made his.”

Bob Jensen's Rotten to the Core threads are at

Corporate Scandals PowerPoint Slides ---

Message forwarded by Ed Scribner

From: Hotchkiss, Carolyn [
Sent: Tuesday, March 21, 2006

Hi, Liz,

Sorry not to get back to you. I'm delighted to have anyone use the slides . . .


Enron Updates
Bob Jensen's threads on updates are at

Tales from the Enron trial got you down? Like Andrew Fastow's testimony of how he laundered $10,000 as a tax-free gift to his own sons? So after work you stumble home, seeking refuge from the workaday sludge in the stark competitive world of Sports Illustrated, which this week is awash in the details of the doping case against Barry Bonds, an Icarus, legend has it, who flew toward baseball heaven on wax wings made from human growth hormone. For perspective on the Bonds myth, I called Gary Wadler, a physician who has seen it all as a member of the World Anti-Doping Agency. "Bonds and Fastow were both into cooking," Dr. Wadler offered. "Bonds cooked the record books and Fastow cooked the financial books."
Daniel Henninger, "Barry Bonds, Meet Andrew Fastow, The Wall Street Journal, March 17, 2006 ---

Long-time subscribers to the AECM may remember my quips (years ago) about Michael Kopper ---
These inspired AECMers to write their own quips about Enron and about accounting in general.
You can read some of these AECM originals at

And don't forget about the Enron home video starring some of the real players (including Jeff Skilling) befpre they got caught ---

From NPR
Profiles of the Enron Suspects and Other Key Players
"Enron: On the Prosecution's List," NPR, March 8, 2006 ---


"Lesser Known Enron Executive Is Key Witness:  Imprisoned Ex-Treasurer Glisan Brings 'Boy Scout' Reputation To Testimony on Financial Deals," by John R. Emshwiller, The Wall Street Journal, March 20, 2006; Page C1 --- 

Although he lacks the star power of some who have preceded him, Ben Glisan Jr. could become the most important witness in the government's effort to convict former Enron Corp. executives Jeffrey Skilling and Kenneth Lay of conspiracy and fraud.

Prosecutors hope the 40-year-old Mr. Glisan, Enron's former treasurer, will provide jurors with convincing support for allegations made by prior witnesses in the trial. Unlike some of those prior witnesses, Mr. Glisan was high enough up the corporate ladder to have regular contact with Messrs. Skilling and Lay, including

A trained accountant, Mr. Glisan helped design some of the financial transactions that are a major part of the alleged fraud at Enron -- and, thus, he should be able to discuss those transactions with an authority that some previous witnesses lacked. Unlike other witnesses who are cooperating with the government in hopes of reducing their sentences, Mr. Glisan simply pled guilty to an Enron-related crime to settle a 26-count indictment and is serving his five-year prison term -- potentially boosting his credibility to jurors.

Mr. Glisan was a protégé of one of the alleged fraud's central figures, former Enron Chief Financial Officer Andrew Fastow, who recently completed four days of often-contentious testimony. While privy to Mr. Fastow's thinking and actions at Enron, Mr. Glisan doesn't carry all the negatives of his former boss, who was feared and disliked by many at Enron and has admitted to stealing millions from the company.

By contrast, the affable Mr. Glisan was a generally popular figure. Even Mr. Skilling, interviewed by Enron investigators shortly after the company's December 2001 collapse into bankruptcy court, was quoted as describing Mr. Glisan as having the reputation of a "boy scout."

Defense attorneys won't be singing Mr. Glisan any campfire tunes when they cross-examine him. They are expected to portray the former treasurer as a liar who betrayed the trust of Messrs. Skilling and Lay by sharing in the booty that Mr. Fastow stole. Mr. Glisan has acknowledged reaping $1 million from a $5,000 investment with a Fastow partnership -- with the profit coming from money that Mr. Fastow admitted filching from Enron and some of his other partners. Defense attorneys hope to bring out contradictions between what Mr. Glisan and Mr. Fastow have told federal officials.

Continued in article

Also see

"Former Enron Treasurer Details His View of Internal Operations," by Gary McWilliams and John R. Emswiller, The Wall Street Journal, March 22, 2006; Page C3 --- Click Here 

He testified the company's senior executives were "manufacturing" earnings and misleading investors in 2001 to cover shortfalls and prop up the energy firm's falling stock price.

As of mid-August 2001, Messrs. Lay and Skilling knew that the company was struggling financially, yet falsely told investors it was in excellent shape, he alleged. Mr. Glisan said that in the succeeding months Enron's condition became "significantly worse," yet Mr. Lay continued to assure investors to the contrary.

Among the problems he said were "billions of dollars of embedded losses" in Enron's international assets. The prosecution introduced an Enron chart that indicated Mr. Skilling estimated the company's international businesses carried a value of $4.5 billion less than the value shown on Enron's books. Mr. Glisan said the company didn't write down the assets because it would have required "a larger loss than we could have stomached" and have serious repercussions for Enron in financial markets.

"Enron's Fastow Testifies Skilling Approved Fraud:  Ex-Executive Says Company Used Deals to Hide Losses, Chokes Up Over Lie to Wife," by John R. Emshwiller and Gary McWilliams, The Wall Street Journal,  March 8, 2006; Page A1 ---

"We misled Lea (Fastow's wife)," Mr. Fastow said. "She would not, in my opinion, have signed a fraudulent tax return. She did it because [the subordinate] Michael Kopper and I conspired. ... I led her to believe that."

But for most of the day, Mr. Fastow was cool and in control as he described the alleged wrongdoing at Enron. His principal target was Mr. Skilling, who helped bring him to Enron in 1990. In 1998, after Mr. Skilling became Enron's president, he tapped Mr. Fastow, then in his late-30s, as chief financial officer.

The prosecution's initial questioning focused on dealings between Enron and the LJM partnerships, which drew their initials from the first names of Mr. Fastow's wife and their two sons. Before its 2001 bankruptcy filing, Enron had routinely reported dealings with LJM and Mr. Fastow in filings with the Securities and Exchange Commission, and Enron contended that the LJM relationship was proper and that because of Mr. Fastow's familiarity with the company, Enron could do deals, such as selling assets, faster and at lower transaction costs.

But the government, in its indictment of Mr. Skilling and Mr. Lay on multiple counts of conspiracy and fraud, contends that LJM was a crucial part of the Enron fraud. Prosecutors allege that by taking money-losing investments off Enron's books and by doing other deals to produce bogus earnings, the LJM operation helped the company mask its deepening financial problems.

Mr. Fastow testified that he came up with the idea for the partnerships in 1999 as a way to help Enron manage its earnings and to enrich himself. As the partnerships' general partner, he said, he was guaranteed hundreds of thousands of dollars in annual fees from LJM1 and millions in fees from LJM2 -- with potentially even larger sums from partnership profits.

Mr. Fastow said Mr. Skilling and others were concerned about how the obvious conflict of interest between his roles as Enron's finance chief and the head of the partnerships would look to investors. "We all agreed it was a rather unusual arrangement," he said. But, he added, Mr. Skilling was enthusiastic about using LJM funds to help manipulate Enron's earnings.

The Enron president said "give me all the juice you can" from the LJMs, Mr. Fastow told the court. Mr. Fastow raised $15 million in investment capital for LJM1 and nearly $400 million for LJM2 from outside parties, many of them banks and investment banks that did business with Enron.

Mr. Fastow said the partnerships were willing to do deals that Enron "just couldn't do with others" because they were too risky or simply didn't make economic sense.

One deal involved an Enron power-plant project in Brazil. In 1999, Mr. Fastow said, Mr. Skilling asked him to have LJM buy an interest in the plant so that Enron could book income and hit its earnings target for the quarter. Mr. Fastow said he used an expletive to describe the power plant. "I told him it was a piece of s-. No one would buy it," he told jurors.

Continued in article

You can read more about Andy Fastow and Michael Kopper at

Years ago, Bob Jensen wrote some quips about Michael Kopper ---

Possible headlines on the Enron saga following the guilty plea of Michael J. Kopper:
  • Kopper Wired to the Top Brass (with reference to secret conspiracies with Andy Fastow)
  • The Coppers Got Kopper
  • Kopper Cops a Plea
  • Kopper’s Finish is Tarnished
  • Kopper Caper
  • Kopper Flopper
  • Kopper in the Kettle
  • A Kopper Whopper

These are Jensen originals, although I probably shouldn’t admit it.


He said Tuesday he misled his wife when he told her the kickbacks were gifts. Fastow stared at the floor as the checks of those ill-gotten gains, written to his wife and sons as well as himself, were displayed for jurors on a massive screen. ''I did this,'' he said, tearful and fighting to compose himself. ''I led her to believe that.''
"Ex-C.F.O. of Enron Says Lay Was Aware of Financial Woes," The New York Times, March 8, 2006 --- Click Here

At last we here from the master criminal himself --- Andy Fastow
"Excerpts from Testimony By Former Enron CFO Fastow," The Wall Street Journal, March 8, 2006 --- 

Former Enron CFO Andy Fastow, the prosecution's star witness, testified at the Lay-Skilling trial that he ran financial partnerships designed to help Enron meet earnings targets and mask huge losses. Mr. Fastow, who hasn't spoken publicly since October 2001, is among the most highly anticipated witnesses in this trial. Following are excerpts from his testimony.

Wednesday, March 8 LAY KNEW: Fastow testified that former chairman Ken Lay was at a meeting in August 2001 in which he heard about a "hole in earnings" at Enron, just days before he gave a BusinessWeek interview claiming Enron was in its "best shape" ever. Fastow said of the Lay interview, "I think most of the statements in there are false."

* * * ON GREED: In a heated cross-examination by Skilling lawyer Daniel Petrocelli, Fastow admitted, "I believe I was extremely greedy, and that I lost my moral compass, and I've done terrible things that I very much regret."

INSIDE-OUT: Steady growth and bright prospects "was the outside view of Enron," Fastow testified. "The inside view of Enron was very different."

* * * RECURRING DREAM: Lay opted to characterize a loss on an investment in the third quarter of 2001 as "nonrecurring," even though a gain on the same holding was earlier characterized as "recurring," Fastow testified, adding, "I thought that was an incorrect accounting treatment."

* * * DEATH SPIRAL: By October 2001, Enron's suppliers refused to trade with the company and Fastow testified that he feared the company would collapse and that he and an aide went to Lay to warn him. "I said I thought this was a death spiral, a serious risk of bankruptcy. I said the majority of trades being done were to unwind positions."

* * * MORE HEROICS: "Within the culture of corruption Enron had, a culture that rewarded financial reporting rather than rewarding economic value, I believed I was being a hero. I was not. It was not a good thing. That's why I'm here today."

Tuesday, March 7 THE PROFIT PROBLEM: One of Enron's off-balance-sheet partnerships, LJM1, was designed to help the company "solve a problem," Fastow testified. "We were doing this to inflate our earnings, and I don't think we wanted to show people what we were doing.''

* * * MORE DEALS: Fastow quoted Skilling as saying, " 'Get me as much of that juice as you can,' '' after Fastow informed him that more money would need to be raised to continue making deals like LJM1. In such deals, these so-called outside entities would purchase underperforming assets from Enron to get debt off its balance sheet and boost earnings.

* * * RISKY BUSINESS: Fastow testified that partnerships like the LJMs were willing to do deals that Enron "just couldn't do with others" because they were too risky or didn't make economic sense.

* * * SKILLING'S WORD: Fastow testified about pressure from Skilling to have one of the LJMs buy a minority stake in a Brazilian power plant owned by Enron because Enron's South American unit was struggling to meet its earnings target. "I told him it was a piece of s--t, and no one would buy it,'' Fastow said, adding that he relented, in part, because Skilling assured him he wouldn't lose money on the deal. Fastow testified that there were many more "bear-hug" guarantees like this from Skilling in mid-2000.

* * * BREAKING THE LAW: Fastow testified that the LJMs were legal and did many legal deals, but "certain things I did as general partner of LJM were illegal."

* * * BELIEVE IT OR NOT: In his first day of testimony, Fastow repeatedly said that he thought he was "a hero for Enron," for coming up with these unique business deals to help the company meet Wall Street targets even when it was financially in trouble. "I thought the foundation was crumbling and we were doing everything we could to prop it up as long as we could … We were in pretty bad shape."

* * * WORRIES ABOUT PUBLICITY: Skilling was concerned, Fastow testified, that off-balance-sheet deals like the LJMs would "attract attention, and if dissected, people would see what the purpose of the partnership was, which was to mask potentially hundreds of millions of dollars of losses."

* * * FALSE TAX RETURN: Fastow tearfully admitted that he "misled" his wife about some of the money the couple earned from Enron-related deals. "She would not, in my opinion, have signed a fraudulent tax return," Fastow said. Lea Fastow served one year in federal prison for filing a false tax return.

* * * A FAMILY AFFAIR: Fastow also admitted that he had one of his top aides send $10,000 checks to each of his sons. The checks were portrayed as gifts to the boys, but really they were proceeds from a business deal. "I shouldn't have. It was the wrong thing to do."

Jensen Comment
It comes as some relief to accountants that Fastow has not yet mentioned collusion with the Andersen Auditors led by David Duncan. CFO Fastow worked in secrecy ripping off Enron itself. CAO Rick Causey worked more closely with Duncan to issue false financial statements. Rick Causey's fine for filing false Enron financial statements was $1,250,000.

You can read more details about Fastow, Causey, Duncan, and the others at

Bob Jensen's Enron Updates are at

Andrew S. Fastow, Enron's former chief financial officer, ended his testimony on Monday, still insisting that Jeffrey K. Skilling and Kenneth L. Lay joined him in telling investors that Enron was profitable and healthy when all of them knew otherwise . . . Mr. Fastow struggled to further corroborate his testimony about the so-called Global Galactic list of illicit side deals he said he made with one of the former chiefs, Mr. Skilling, to guarantee profits. Mr. Fastow also tried to buttress his claims that he warned Mr. Lay, Enron's founder, in a private meeting that Enron was in desperate need of a "massive restructuring."
Alexei Barrionuevo, "Fastow Leaves Stand Insisting Lay and Skilling Knew," The New York Times, March 14, 2006 --- 

What is "The Wall Street Journal" Risk?
Under questioning from the prosecutor, John Hueston, Mr. Fastow said Enron's board and top two executives discussed the questionable nature of the partnerships, but ultimately approved them because they would help the company hide hundreds of millions dollars in losses. At one board meeting, a director wondered out loud about the "scrutiny and great problems" Enron could face if information about the partnerships became public, describing it as "The Wall Street Journal risk," testified Mr. Fastow, 44, who reached a plea bargain with prosecutors on charges against him.
Alexy Barrionuevo and Vikas, Bajaj, "Fastow Says Enron Executives Approved Deals to Hide Losses," The New York Times, March 7, 2006 --- Click Here 

Under questioning from the prosecutor, John Hueston, Mr. Fastow said Enron's board and top two executives discussed the questionable nature of the partnerships, but ultimately approved them because they would help the company hide hundreds of millions dollars in losses.

At one board meeting, a director wondered out loud about the "scrutiny and great problems" Enron could face if information about the partnerships became public, describing it as "The Wall Street Journal risk," testified Mr. Fastow, 44, who reached a plea bargain with prosecutors on charges against him.

At the same meeting, another director raised questions about the propriety of Mr. Fastow's personally profiting from LJM1; he was guaranteed $800,000 a year from the partnership regardless of how it performed financially. But Mr. Fastow asserted that Mr. Skilling came to his defense, saying, "Andy Fastow has put $1 million into the game. He should get profits because he has skin in the game."

Nonetheless, the board approved LJM1, which also had $15 million from outside investors, in early 1999. Later that year, Mr. Fastow testified, Mr. Skilling encouraged him in his efforts to create LJM2, for which he would eventually raise a total of $386 million. Mr. Fastow earned $8 million in fees from the second partnership and was entitled to 20 percent of the entity's profits.

"Get me as much juice as you can," Mr. Fastow recalled Mr. Skilling saying.

"We were using the equity to juice Enron's earnings," Mr. Fastow added, "to report as much earnings as we wanted."

Mr. Fastow follows a parade of former Enron executives who, under questioning from the prosecution, have presented critical and damaging testimony against the two former top executives, particularly Mr. Skilling. In its sixth week, the trial is the culmination of a four-year federal investigation into the failure of and fraud at Enron and is widely believed to be one of the most significant white-collar criminal prosecution ever undertaken.

Mr. Fastow spoke in a strong, clear voice with his trademark lisp, and he sipped coffee and water during his testimony. At one point he asked Mr. Hueston for some water.

Mr. Skilling bobbed his head from side to side as Mr. Fastow spoke; Mr. Lay seemed to be looking off to the side.

Before the testimony, Mr. Skilling appeared calm and chatted with a reporter about trips to Argentina.

Some legal experts had recently suggested that given the government's success thus far, they should have considered not calling Mr. Fastow as a witness, because he was so closely involved in the fraud at Enron and personally benefited from the off-balance-sheet partnerships.

A central tenet of Mr. Lay's and Mr. Skilling's defense is that Mr. Fastow masterminded most of the wrongdoing at Enron and misled his bosses about his activities. Defense lawyers intend to vigorously attack Mr. Fastow's credibility and the deal he reached with prosecutors, in which he has pleaded guilty and agreed to a prison sentence that could total 10 years.

Continued in article


Enron Corp. dipped into reserve accounts to illegally pad earnings in 2000 and improperly delayed reporting large losses in a retail energy operation the following year, former accountants testified yesterday. The testimony began the fifth week in the criminal conspiracy-and-fraud trial of former Enron Chairman Kenneth Lay and former President Jeffrey Skilling. The testimony provided new support for the Justice Department's accusations that the two top executives manipulated results at the company. Wesley Colwell, former accounting chief of Enron's wholesale energy unit, alleged he shifted a total of $14 million in July 2000 to create a two-cents-a-share boost to the company's second-quarter results. He testified that an Enron finance executive told him that month that Mr. Skilling was looking to "beat the Street" estimate of its second-quarter earnings. Mr. Colwell, who is testifying under a cooperation agreement with the government, paid a $500,000 fine to settle allegations by the Securities and Exchange Commission that he manipulated earnings. His agreement with the Justice Department requires that he testify to avoid criminal prosecution. Three previous government witnesses, all former Enron executives, pleaded guilty to crimes related to the energy giant. Mr. Colwell, who is testifying under a cooperation agreement with the government, paid a $500,000 fine to settle allegations by the Securities and Exchange Commission that he manipulated earnings. His agreement with the Justice Department requires that he testify to avoid criminal prosecution. Three previous government witnesses, all former Enron executives, pleaded guilty to crimes related to the energy giant.
Gary McWilliams and John R. Emshwiller, "Accountant Says Enron Dipped Into Reserves to Pad Earnings," The Wall Street Journal, February 28, 2006; Page C3 ---


"Testimony Links Skilling, Lay To Alleged Effort to Hide Losses," by John R. Emshwiller and Gary McWilliams, The Wall Street Journal, March 1, 2006; Page C2 ---

The former head of Enron Corp.'s retail-energy unit tied former President Jeffrey Skilling and former Chairman Kenneth Lay in testimony to an alleged effort to improperly hide hundreds of millions of dollars of losses in the division.

The testimony yesterday by David Delainey, who headed Enron Energy Services, or EES, was some of the most specific yet linking Messrs. Lay and Skilling to alleged wrongdoing. The former Enron president and chairman are in the fifth week of their federal fraud and conspiracy trial. Mr. Delainey has pleaded guilty to one count of insider trading and agreed to pay nearly $8 million in penalties. Like four previous witnesses, he is testifying for the government as part of a cooperation agreement.

Mr. Delainey took over the retail unit in early 2001 after having headed the company's profitable wholesale-energy trading operation. While Enron at the time was publicly portraying the retail unit as profitable and growing, Mr. Delainey contended yesterday that he found a problem-ridden unit burdened by hundreds of millions of dollars of losses. He said another senior executive had told him the unit's financial problems "could potentially bankrupt Enron."

At a March 29, 2001, meeting led by Mr. Skilling, Mr. Delainey testified, a decision was made to hide some of the big EES losses. Mr. Delainey said he argued the action, which involved moving some retail operations to the profitable wholesale unit, "lacked integrity" and shouldn't be done.

Continued in article

Forwarded by Bob Overn

Did Enron's chairman ever meet with the president?

Answer: Yes,

A. Enron's chairman did meet with the president and the vice president in the Oval Office.

B. Enron gave $420,000 to the president's party over three years.

C. It donated $100,000 to the president's inauguration festivities.

D. The Enron chairman stayed at the White House 11 times.

E. The corporation had access to the administration at its highest level and even enlisted the Commerce and State Departments to grease deals for it.

F. The taxpayer-supported Export-Import Bank subsidized Enron for more than $600 million in just one transaction. Scandalous!!

G. BUT...the president under whom all this happened WASN'T George W. Bush.

SURPRISE ... It was Bill Clinton!

"Warning on Enron Recounted," by Alexei Barrionuevo, The New York Times, March 16, 2006 ---

Ms. Watkins, 46, attracted national attention after testifying before Congress in February 2002 about Enron's collapse two months earlier. She was named one of Time magazine's people of the year in 2002 for raising red flags about the company's accounting while still working there. She has since written a book with a Houston journalist about Enron's fall, and formed a consulting practice that advises companies on governance issues.

Defense lawyers, during combative cross-examination, tried to paint Ms. Watkins as an opinionated fame-seeker who had profited from the Enron scandal on the lecture circuit. The defense lawyers also suggested that Ms. Watkins was never charged with insider trading for selling Enron shares because she was wrong in believing that the Raptors were fraudulent.

Prosecutors contend that the partnerships and hedges Ms. Watkins testified about were part of a broad effort by Mr. Skilling and Mr. Lay to manipulate earnings and hide debt. The former chief executives are accused of overseeing a conspiracy to deceive investors about Enron's finances so they could profit by selling Enron shares at inflated prices.

Defense lawyers contend that prosecutors are seeking to criminalize normal business practices and that the Enron executives were the victims of thieving subordinates like Andrew S. Fastow, the former chief financial officer.

Ms. Watkins's appearance on the stand came as the government neared the end of its case. Judge Simeon T. Lake III said Wednesday that he estimated that the case could be wrapped up by the end of April.

Ben F. Glisan Jr., a former Enron treasurer, is scheduled to take the stand next week. Mr. Glisan pleaded guilty to conspiracy and is currently serving a five-year prison term.

In often-colorful testimony, Ms. Watkins recounted how she became concerned around June 2001 that about a dozen Enron assets were being hedged, or guaranteed against loss, by the Raptors vehicles, which she soon learned contained only Enron stock. The Raptors were intertwined with partnerships run by Mr. Fastow, who became Ms. Watkins's boss that summer. The value of the assets, she said, "had tanked," dragged down by Enron's plummeting share price.

After doing some investigation, she wrote an anonymous letter about her concerns, then on Aug. 22, 2001, she met with Mr. Lay to discuss them. The meeting came about a week after Mr. Lay had stepped back into the role of chief executive after the resignation of Mr. Skilling.

At the meeting, they discussed a letter of hers in which she had said that she was "incredibly nervous that Enron would implode in a wave of accounting scandals." She also noted to Mr. Lay that employees were talking about a "handshake deal" that Mr. Fastow had with Mr. Skilling that ensured that Mr. Fastow would not lose money on transactions done with the LJM partnership, which Mr. Fastow was running.

Mr. Lay seemed to take her seriously, Ms. Watkins testified.

Days after the meeting, she learned that Vinson & Elkins, the law firm that had originally approved the Raptors, was doing the internal investigation into the partnerships. The firm, after consulting with Arthur Andersen, Enron's auditor, issued a report saying that while the "optics" or appearances were bad, the accounting was appropriate.

Ms. Watkins said she remained adamant that Andersen, which had received several high-profile setbacks, should not be trusted.

"I thought this was bogus," she said of the investigation.

Concerned that Enron was manipulating its financial statements, Ms. Watkins stepped up efforts to leave the company, which she had begun shortly after she concluded the Raptors could be fraudulent. She did not leave until after the bankruptcy.

Ultimately, Mr. Lay decided to unwind the Raptors and take a write-off in a single quarter rather than restate the accounting of Enron's financial statements. Ms. Watkins, under questioning from Chip B. Lewis, a lawyer for Mr. Lay, conceded that while that was not her preference, "continuing the fraud would have been worse."

Defense lawyers sparred with Ms. Watkins from the outset. Mr. Lewis placed a copy of Ms. Watkins's book, "Power Failure," in front of her, calling it a "housewarming present."

Ms. Watkins acknowledged that she could not explain why prosecutors did not charge her with insider trading for selling Enron shares.

Continued in article

Bob Jensen's Enron Updates are at

Bob Jensen's Enron Quiz is at

Corrections to the published text of IFRS ---
I discovered this link on March 6 at the IAS Plus site ---
There are also some good links to harmonization efforts.

"Classy Economist Thomas Sowell is a lifetime student of the market force," by Jason L. Riley, the Wall Street Journal, March 25, 2006 ---

Thomas Sowell's excuse for limiting interviews to an hour is that it helps him "avoid stress." But one suspects the real reason is that he has better uses for his time than to humor nettlesome journalists. In any case, it's hard to question the time-management preferences of a man who's published nearly 30 books, while also producing academic articles, long-form magazine essays and a seldom-dull newspaper column for more than two decades. Not bad for an orphan from Jim Crow North Carolina who never finished high school and didn't earn a college degree until he was 28.

Mr. Sowell's unorthodox views on racial matters have made him our foremost "black conservative," but the modifier sells him way short. He is one of the country's leading social commentators--without qualification. And his scholarship is not only voluminous but wide-ranging, covering everything from education and law to political philosophy, migration and the history of ideas. His primary discipline, however, is economics, specifically the history of economic thought, the subject in which he earned his doctorate from the University of Chicago in 1968 under Milton Friedman and George Stigler. It is the subject he taught at Cornell, UCLA, Amherst, Brandeis and elsewhere during an academic career in the 1960s and '70s. And it is the subject of his most recent book, "On Classical Economics," which Yale has just published.

Mr. Sowell, who will turn 76 this year but looks 20 years younger, sat for an interview on a cool, drizzly morning at Stanford University's Hoover Institution, his perch since 1980, and where he is--appropriately--the Rose and Milton Friedman Senior Fellow. He describes his latest tome as "partly an old book and partly a new book." It combines four somewhat revised essays on microeconomics, macroeconomics, methodology and social philosophy from his 1974 publication, "Classical Economics Reconsidered," with four new essays, on Mill, Marx, Sismondi and economic history. Asked why classical economics--and economists like Adam Smith, David Ricardo, Mill and Marx--continues to deserve attention, Mr. Sowell replies that "if classical economics is relevant, than Mill and Marx are relevant. Why is classical economics relevant? I guess it's relevant because there are people who study it, and if they're going to talk about it they ought to know what they're talking about, which is a requirement sometimes overlooked."

Free-market economics, a legacy of the classical school, is thought of as an old conservative doctrine. But Mr. Sowell explains that it was in fact one of the most revolutionary concepts to emerge in the history of ideas. Moreover, "the thinking of the classical economist was not only a radical break from landmark intellectual figures like Plato and Machiavelli but also from mainstream thinking to this day." The notion of a self-equilibrating system--the market economy--meant a reduced role for intellectuals and politicians, he says. "And even today many still haven't accepted that their superior wisdom might be superfluous, if not damaging."

Mr. Sowell may be an unabashed free-market adherent, but he's proud to say that Professor Sowell left his personal views out of the classroom. In his 2000 memoir, "A Personal Odyssey," he relates an episode in which some students approached him after taking his graduate seminar on Marxian theory. They expressed appreciation for the course but added, "We still don't know what your opinion is on Marxism." He took it as an unintended compliment.

"My job was to teach them economics, not teach them what I happen to believe," says Mr. Sowell, who adds that efforts by some today to counterbalance the prevailing liberalism in academia with more right-wing instructors is not only an exercise in futility but a disservice to students. "Even if you succeed in propagandizing the students while they're students, it doesn't tell you much [about how they'll turn out]. I suspect that over half [of the conservatives at the Hoover Institution] were on the left in their 20s. More important, though, let's assume for the sake of argument that, whatever you're propagandizing them with on the left or right, every conclusion you teach them is correct. It's only a matter of time before all those conclusions are obsolete because entirely different issues are going to arise over the lifetimes of these students. And so, if you haven't taught them how to weigh one argument against another, you haven't taught them anything."

This lifelong passion for economics has been much on display in recent years--"On Classical Economics" was preceded by "Basic Economics: A Citizen's Guide to the Economy" (2000) and "Applied Economics: Thinking Beyond Stage One" (2003), both of which were written for the general public. And it's worth noting the extent to which Mr. Sowell's background in the dismal science also informs his better-known works on ethnicity, race and culture. Other black conservative scholars have their strengths, to be sure. Shelby Steele writes like a dream and favors an existential approach to racial matters. John McWhorter's prose is as hip as it is provocative.

But Mr. Sowell's forte has always been rigorous analysis and adherence to facts, however stubborn and wherever they lead. And the facts led him on a writing tear in the '70s and '80s. Some titles, like "Race and Economics" (1975), "Markets and Minorities" (1981) and "The Economics and Politics of Race" (1983), betray his technical background. But Mr. Sowell's other influential books of this period--"Black Education: Myths and Tragedies" (1972), "Ethnic America" (1981), "Civil Rights: Rhetoric or Reality?" (1984)--are no less distinguished by the dispassionate empiricism he brings to such emotionally charged topics. In these tomes and elsewhere, Mr. Sowell's research questions the basic assumptions behind popular public policies aimed at minorities.

And in the process, he's made mincemeat of the sloppy methodology and flaccid arguments put forward by mainstream civil right leaders and their liberal sympathizers. He has shown, empirically, that affirmative action does not benefit poor blacks. He has shown, empirically, that political clout is not a prerequisite for ethnic economic advancement. And most importantly, he has exposed the harmful fallacy of using racial and gender discrimination as an all-purpose explanation for statistical group disparities.

Asked why many of these failed ideas, and the black leaders who promote them, don't seem to lose credibility, Mr. Sowell responds that the phenomenon is hardly limited to the realm of race. "You could take it beyond the black leadership," he says. "Has [John Kenneth] Galbraith lost any credibility? I remember 'The New Industrial State'"--the 1967 book in which Mr. Galbraith famously argued that large corporations were immune to marketplace forces--"but since then, Eastern Airlines has gone out of business. The Graflex Corporation has gone out of business. Similarly with all kinds of big businesses. This hasn't made the slightest dent in Galbraith's reputation. We have Paul Ehrlich, who has told us there would be mass starvation in the world in the '80s, and now we find our two biggest problems are obesity and how to get rid of agricultural surpluses." Mr. Sowell's conclusion is a cynical one. "I have a book called 'The Vision of the Anointed,' and there's a chapter in there called 'The Irrelevance of Evidence.'"

The idea to apply economic concepts to racial issues came, says Mr. Sowell, from the late Benjamin Rogge, who taught economics at Wabash College in Indiana. "I was at Cornell, and Ben Rogge came on campus to give a talk called 'The Welfare State Against the Negro.' I happened to be out of town, so when I got back I wrote him a letter that said I heard you gave this talk and that you're going to write a book on the same theme. I said it's really amazing that no one's thought of this before because there's so much material out there. At this point [in the late '60s] I had no thought that I would ever touch it myself." The two became friends over the years and "it occurred to Ben that he was never going to write that book. And so Ben Rogge took his manuscript and simply handed it to me and said do with it whatever you can. I was flabbergasted. I don't think I ever used anything directly from his manuscript. But the fundamental idea the you could apply economics to racial issues--that was the inspiration."

Similarly, Mr. Sowell says his interest in "international perspectives"--most notably demonstrated in his lengthy trilogy on cultural history published in the 1990s--initially came from reading Nathan Glazer and Daniel Patrick Moynihan's 1963 classic study, "Beyond the Melting Pot." "It was really the first book I read about different ethnic groups. There were many different patterns. And more than anything else, each group had its own pattern.

"The left likes to portray a group as sort of a creature of surrounding society. But that's not true. For example, back during the immigrant era, you had neighborhoods on the Lower East Side [of Manhattan] where Jews and Italians arrived at virtually identical times. Lived in the same neighborhoods. Kids sat side by side in the same schools. But totally different outcomes. Now, if you look back at the history of the Jews and the history of the Italians you can see why that would be. In the early 19th century, Russian officials report that even the poorest Jews find some way to get some books in their home, even though they're living in a society where over 90% of the people are illiterate.

"Conversely, in southern Italy, which is where most Italian-Americans originated, when they put in compulsory school-attendance laws, there were riots. There were schoolhouses burning down. So now you take these two kids and sit them side by side in a school. If you believe that environment means the immediate surroundings, they're in the same environment. But if you believe environment includes this cultural pattern that goes back centuries before they were born, then no, they're not in the same environment. They don't come into that school building with the same mindset. And they don't get the same results."

It somehow seems an imposition to press Mr. Sowell on his next project, though he graciously allows that a collection of correspondence, as well as a book on intellectuals, is in the works. As the interview clock winds down, however, he returns briefly to the topic of race. He laments the fact that more public intellectuals aren't applying economic analyses to racial policies, even while he understands the hesitation.

"I think it would be great if someone would sit down and take a sort of systematic textbook approach to it," says Mr. Sowell. "[George Mason University economist] Walter Williams has written a couple of very good books, but unfortunately they were not well promoted. Guys like Gary Becker have other fish to fry, and they're writing for a different audience. Besides Walter and me, I don't know who else out there would write it. And heaven knows it's not the golden pathway to instant popularity."

March 10, 2006 message from Dan Stone, Univ. of Kentucky [dstone@UKY.EDU]

Ok, now you can answer that trivia question that comes up over dinner at the next BAP banquet.

Specifically: "which CPA firm was the first to podcast?"

Answer: Deloitte (based on 10 minutes of web searching)

Listen up at:,1041,sid=101157&cid=105840,00.html 


Dan Stone U of Kentucky

March 28, 2006 message from Joe Brady

I am looking for freeware accounting system packages implemented in MS Excel or MS Access. If you know of any, please let me know how I can obtain. I will summarize respones for AECM. Thank you.

Joseph A. Brady
Accounting & MIS
Lerner College of Business & Economics
University of Delaware 

March 28, 2006 reply from Bob Jensen

Hi Joe

For freeware and shareware, I recommend that you first enter "Excel Accounting" in the search box at
Then do the same thing for "Access Accounting"
In general, Tucows is a great site for finding free software. It has been around for decades and has a wonderful rating system.

Although the consulting services are not free, a extensive listing of MS Access accounting system software appears at
This site also has some MS Access tips.

Some non-free Excel accounting packages are listed at

You might find some interesting free accounting software based on Excel at this rather difficult site to navigate ---

2000 uses for WD40 ---

• Use to loosen rusty nuts and screws, clean garden tools.
• Cleans piano keys
• Keeps wicker chairs from squeaking
• Lubricates small rolling toys
• Keeps garden tools rust-free
• Cleans patio door glide strip
• Removes crayon from clothes dryer (make sure to unplug dryer first)
• Removes scuff marks from ceramic tile floor
• Keeps metal wind chimes rust-free
• Removes crayon from walls
• Helps join plastic shelving to make disassembly easier
• Removes water spots from mirrors
• Lubricates hinge on pruning shears
• Lubricates screws on lawn furniture
• Lubricates hydraulic rams on slideout of 5th wheel
• Cleans fiberglass bathtubs
• Cleans and prevents rust on oil tank exterior
• Cleans and protects bed of wheelbarrows
• Prevents rust on swamp cooler nuts
• Removes tea stains from countertops
• Removes crayon from wallpaper
• Lubricates gate locks
• Removes crayon from carpet
• Removes tape marks from the wall where posters hung
• Shines leaves of artificial houseplants
• Keeps snow from sticking to shovel
• Removes coffee stains on floor tiles
• Keeps hose ends from corroding
• Lubricates moving parts on playground equipment
• Removes crayon from plastic
• Removes decals from bathtubs
• Removes old cellophane tape
• Removes crayon from shoes
• Cleans ashtrays
• Removes crayon from toys
• Cleans and protects underside of cast iron skillets
• Removes ink from carpet
• Keeps garden plant cages bright and rust free
• Cleans lawnmower blades
• Cleans and protects antique kitchen tools
• Prevents mildew growth on fountain
• Removes marks from floors left by chair feet
• Removes crayon from chalk boards
• Eliminates static on volume and tuning control knobs
• Cleans candle soot
• Removes ink from blue jeans
• Cleans residue on luggage handles
• Cleans old muffin tins
• Cleans and protects pruning shears
• Cleans gold-plated faucets
• Removes petroleum stains from clothing
• Keeps sewing needles from rusting
• Removes Kool-Aid stains from carpet and fabric
• Removes gunk from plastic dish-drainer
• Lubricates kitchen sink handheld spray nozzle
• Removes rust from curtain rods
• Removes adhesive from precious china
• Cleans bottoms of pots and pans
• Helps prevent rust on hide-a-key containers
• Cleans vinyl garage doors
• Cleans doggie doo from tennis shoes
• Removes gunk when replacing old faucets
• Cleans and protects medicine door latches
• Protects wrought iron from rust
• Removes tomato stains from clothes
• Prevents rust from forming on washing machines
• Keeps metal wire screens rust free
• Removes blue baked-on acrylic cover shields from acrylic windows
• Preventative maintenance on cooking burner
• Removes coffee stains from leather
• Protects electric pump on furnace
• Removes ink stains from leather
• Prevents corrosion on copper parts of fountain
• Lubricates folding parts of ironing board
• Removes rust from chair feet
• Cleans and polishes gold and brass lamps
• Removes adhesive price tag from shoe bottoms
• Keeps trigger on glue gun from sticking
• Cleans bed frame
• Protects shower heads from rust
• Protects silver from blackening
• Lubricates external pivots on lawnmowers
• Keeps blades from rusting on garden plow
• Cleans black streaks from hardwood floors
• Protects inner machinery in toilet against corrosion
• Removes paint from tile flooring
• Protects hand trowels from corrosion
• Cleans and protects pitchforks
• Lubricates screen channels upon installation of rubber bead
• Removes rust stains from bathroom tubs
• Cleans metal figurines
• Shines shower doors
• Protects patio door from sun damage
• Cleans mildew from refrigerator gasket
• Helps clean rust from wire shelves
• Cleans newspaper ink from tables
• Removes rust stains from floor after mopping
• Cleans and protects TV antenna
• Removes gum from wallpaper
• Penetrates and frees stuck toilet shutoff valve
• Spray on rototiller blades to prevent rust during off-season
• Cleans melted vacuum belt from carpeting
• Removes crayon from television screen

Continued at 

Tidbits Between March 1 and March 31, 2006, 2006

Tidbits on March 2, 2006
Bob Jensen
at Trinity University 

New: Top 25 Google e-searches of the month
          Most Popular Web Sites 2006 - 2007 ---
          WebbieWorld Picks ---

Fraud Updates ---
For earlier editions of New Bookmarks go to 
Archives of Tidbits: Tidbits Directory ---

Bob Jensen's various threads ---
       (Also scroll down to the table at )

Click here to search Bob Jensen's web site if you have key words to enter --- Search Site.
For example if you want to know what Jensen documents have the term "Enron" enter the phrase Jensen AND Enron. Another search engine that covers Trinity and other universities is at

Internet News (The News Show) ---

Bob Jensen's home page is at

Security threats and hoaxes ---

25 Hottest Urban Legends (hoaxes) --- 
Hoax Busters --- 
Stay up on the latest and the oldest hoaxes ---

Online Video
In the past I've provided links to various types of music and video available free on the Web. 
I created a page that summarizes those various links ---

For those of you who missed this on February 26, the 60 Minutes television module on breakthroughs of stem cell research for spinal cord injuries might listen to the audio module of 60 Minutes --- Stem Cell Advances
The above link may not last very long on the Web. The module also discusses advances in regenerating damaged heart tissue and the forthcoming clinical trials (the first ever) on the fatal childhood Battens Disease  These advances are the closest things to miracle cures in history. Thus far only embryos that were going to be otherwise destroyed are being used in the research.

The main link to this and other video/audio modules on 60 Minutes is at:  Click Here

Franz Kafka's Metamorphosis ---

The Digital Duo show you how to save time, money, and your sanity when hunting down deals online ---,segid,133,00.asp

Recent modules on CBS Sixty Minutes ---  Click Here

Free Video Downloads: Check the offerings at your local public libraries
"Free Movies: Video: How to get films for nothing online: from the library," by Yvonne Dennis, The Wall Street Journal,  February 18, 2006; Page P2 ---


Free music downloads --- ---

In the past I've provided links to various types of music and video available free on the Web. 
I created a page that summarizes those various links ---

This is a great site for patriots (you must scroll the entire page) ---
It includes several patriotic songs by Johnny Cash. 
There are also some nice poems such as the one below:
America:  Why I Love Her by John Mitchum---

From NPR
Maude Maggart: A New Generation of Cabaret ---


From NPR
Jazz Archives ---

From NPR
Jessi Colter Finds Her Way 'Out of the Ashes' ---

Momma Don't Let Your Babies Grow Into ... Click Here


Photographs and Art

The "Oops" List (includes photographs of crashed airplanes and other "Oops" happenings --- Many of the photographs and cartoons on the “Oops” list will be familiar. You may not have seen some of these images, some of which are hilarious.
The "Oops" List  (some links are video links) --- 

From NPR
Photographs of the 2006 Winter Olympics --- Click Here

Photo Essay: Dirty Oil Oil companies are, to the chagrin of environmentalists, mining a rich source of bitumen in Canada," MIT's Technology Review ---,296,p1.html

Largest ever galaxy portrait - stunning HD image of Pinwheel Galaxy ---

Giant galaxies weren't assembled in a day. Neither was this Hubble Space Telescope image of the face-on spiral galaxy Messier 101 (the Pinwheel Galaxy). It is the largest and most detailed photo of a spiral galaxy beyond the Milky Way that has ever been publicly released. The galaxy's portrait is actually composed from 51 individual Hubble exposures, in addition to elements from images from ground-based photos. The final composite image measures a whopping 16,000 by 12,000 pixels.

The Origin of Darwin ---

Sandstorm in Iraq ---

Wild Things Photography ---

Impressionism Museum ---

Applying mathematics to Escher's Print Gallery
This website aims to visualize the mathematical structure behind Escher's Print Gallery ---

Photographs of the Golden Age of Jazz ---

Burningman Photography (some nudes) ---

Diego Revera Museum ---

Online Books, Poems, References, and Other Literature
In the past I've provided links to various types electronic literature available free on the Web. 
I created a page that summarizes those various links ---

The Million Books Project at Carnegie Mellon University ---

Google Book Search --- 

Internet Book List ---

The Literature Network ---

From McMaster University
Archive for the History of Economic Thought ---

Academy of American Poets (also has audio) ---

The Arabian Nights ---

John Keats Poetry ---

Dante Worlds (Multimedia) ---

Van Gogh's Letters ---

Goya Black Paintings ---

Quotations from Think Exist ---

Josephson Institute Quotations ---

Giga Quotes ---

Last Words of Real People ---
Last Words of Fictional Characters ---
Famous Epitaphs ---
Other Last Words ---

Barnes and Noble Book Browser ---

Dual Covenant Theology: Thanks to the Cornerstone Church in San Antonio Jews Can Now Get Into Heaven
An evangelical pastor and an Orthodox rabbi, both from Texas, have apparently persuaded leading Baptist preacher Jerry Falwell that Jews can get to heaven without being converted to Christianity. Televangelist John Hagee and Rabbi Aryeh Scheinberg, whose Cornerstone Church and Rodfei Sholom congregations are based in San Antonio, told The Jerusalem Post that Falwell had adopted Hagee's innovative belief in what Christians refer to as "dual covenant" theology.

Ilan Chaim, Jerusalem Post, March 1, 2006 --- Click Here
Jensen Comment:  This must be a huge relief to Jewish faithfuls.

Late Breaking Good News and Bad News About Heaven

New "Scientific Evidence" allegedly "proves" that heaven truly exists
But a new documentary, "The Evidence for Heaven," available exclusively through WND's ShopNetDaily online store, offers scientific evidence for the afterlife.
"New scientific evidence heaven really exists:  Blockbuster DVD includes astounding back-from-dead testimonialsWorld," WorldDailyNet, March 2, 2006 ---
Jensen Comment
Us Texans will be down where there are more barbeque events. We will, however, look up to you folks drifting about overhead while nibbling on cold manna.

Really bad news for Jews now that it's a scientific fact that heaven does exist
Reverend Falwell denies that he ever once believed that Jews can get into heaven

Evangelist Jerry Falwell has a beef with the Jerusalem Post after the newspaper published an article suggesting he's changed his beliefs about salvation, now thinking Jews can get to heaven without becoming Christians first. "Televangelist John Hagee and Rabbi Aryeh Scheinberg, whose Cornerstone Church and Rodfei Sholom congregations are based in San Antonio, told the Jerusalem Post that Falwell had adopted Hagee's innovative belief in what Christians refer to as 'dual covenant' theology. This creed, which runs counter to mainstream evangelism, maintains that the Jewish people have a special relationship to God through the revelation at Sinai and therefore do not need 'to go through Christ or the Cross' to get to heaven."
"Falwell: Jerusalem Post 'fabricated' story on me Newspaper claimed Christian evangelist had new tune on how Jews get to heaven," WorldDailyNet, March 1, 2006 ---

Pastors John Hagee and Jerry Falwell have both denied a report in The Jerusalem Post earlier this week that they embrace the "dual covenant" theology, which holds that Jews are saved through a special relationship with God and so need not become Christians to get to heaven.
"Hagee, Falwell deny endorsing 'dual covenant'," Jerusalem Post, March 2, 2006 ---

Jensen Comment
Just goes to show you what might happen to evangelism if just anybody can pass through the Pearly Gates. Authorities are moving quickly to  Plains, Georgia to have Jimmy Carter settle this matter once and for all --- --- Click Here

March 2, 2006 reply from a Jewish friend who is also an accounting professor

This little tempest isn't sitting so great with the JPost readers.  One writes (in talkback to the article for which you provide the url:
2. Explain 24 gates and 24 elders
David - Israel
03/02/2006 16:02

Falwell should read his N. Testament. Revelations where John sees 24 elders before the throne representing 12 tribes of Israel and 12 Apostles. Hmmmm, no replacement theology there. And the new J-town has 24 gates; twelve for the tribes and 12 Apostles. Hmmmmm. Sounds like God can dual anything He wants. And who said you can't meet Jesus and receive your faith in Jesus after your dead? N. Test verses make case for that. And every knee shall bow and every tongue confess. I don't know how you force someone to do that? Sorry Christians God is up to something far greater than just saving you. Far greater.

So Bob, I guess my day is still OK?

Driver carries no cash. He's married.
Bumper Sticker

All I ask is the chance to prove that money can't make me happy.
Bumper Sticker

Vote Democrat — it's easier than working!
Bumper Sticker

Vote Republican — it's easier than thinking!
Bumper Sticker

George W. Bush is about to fritter away his party's last advantage. What Republicans have had going for them is that they aren't Democrats.
Wesley Pruden, "Taking a chance on love for sale," The Washington Times, February 24, 2006 ---

We hang the petty thieves and appoint the great ones to public office.

Around me, if a woman don't wear mink, she don't wear nothin'.
Big Boy Caprice in the 1001 movie Dick Tracie Directed by Warren Beatty, screenplay by Jim Cash and Jack Epps Jr

There are three kinds of death in this world. There's heart death, there's brain death, and there's being off the network.
Guy Almes

117 documents match your query. Search for top-selling titles about +dwarf +"pubic hair".

The number one problem in our country is apathy ... But who cares?
Darrel Anderson

Advice not heeded by Bob Jensen
Ignorance of your profession is best concealed by solemnity and silence, which pass for profound knowledge upon the generality of mankind.
"Advice to Officers of the British Army", 1783

I have learned from an early age to abjure the use of meat, and the time will come when men such as I will look upon the murder of animals as they now look upon the murder of men.
Leonardo da Vinci (1452-1519)

The was (possibly still is) a billboard outside of Saskatoon showing a feeding moose. The sign read as follows:

There's plenty of room for all God's creatures,
Right beside the mashed potatoes.

A teacher who castrated a live pig in front of her high school class is the target of protests by animal rights activists throughout the country. The protests began after People for the Ethical Treatment of Animals posted information about the incident at Rosamond High School on its Web site last month. The posting does not say when the castration occurred. "We're concerned not only because animals suffer during these routine castrations but also because of the message it sends to students who are still forming opinions about treatment of animals in our society," said Stephanie Bell, a PETA cruelty case worker.
"Castration of live pig at Central Calif. school ignites protests," Modbee, February 22, 2006 ---

Japan Warns U.N. of Funding Cut If widespread fraud and waste at the United Nations is not stopped, Japan says it may cut its funding for the scandal-ridden international organization.
NewsMax, February 24, 2006 ---

Remember This One? (turn your speakers up)
Do Your Own Damn Taxes Video (music from Frank Sinatra) --- 

University of Michigan may extend time to tenure to 10 years
In part to try to make the academy family friendly, the University of Michigan is currently mulling over changes to the process it uses to promote professors, which would include extending the maximum time to receive tenure from 8 to 10 years. Higher education experts have increasingly been saying that, as baby boomers age and require more attention, and as more women flood academe, a bit of flexibility is in order.
David Epstein, "Slowing Down Tenure Time," Inside Higher Ed, February 28, 2006 ---

Atheists and Agnostics Need Not Apply for Work at the University of Charleston

Edwin H. Welch, president of the University of Charleston, is investigating the legal ramifications of an advertisement that states that applicants must believe in God — an apparent violation of federal anti-bias laws. . . . The ad says that prospective candidates must have earned a doctorate and expertise in ethics, have had faculty development experience and “must embrace a belief in God and present moral and ethical values from a God-centered perspective.” The unusual job requirement was noted on Brian Leiter’s blog.
Rob Capriccioso, "Divinely Inspired Bias?" Inside Higher Ed, March 1, 2006 ---

In an attempt to avoid violating civil rights laws, the University of Charleston has made changes to a co.
oversial job requirement the stated that applicants for the Herchiel and Elizabeth Sims “In God We Trust” Chair in Ethics must believe in God.
Rob Capriccioso, "Charleston Ends Illegal Job Requirement," Inside Higher Ed, March 2, 2006 ---

What's really behind epidemic of teacher-student sex?

The seemingly endless stream of reports of female school teachers having sex with their underage male students – a storyline titillating to some but profoundly disturbing to most – is one of today's most sensational news stories. In fact, a recent, federally funded study concludes the problem of school teachers molesting students dwarfs in magnitude the clergy sex-abuse scandal that rocked the Catholic Church. Now, in a groundbreaking investigation, the newest edition of WND's elite monthly Whistleblower magazine – titled "PREDATORS: What's really behind today's epidemic of teacher-student sex?" unveils what's really behind this troubling new phase in the "sexual revolution."
"PREDATORS:  What's really behind today's epidemic of teacher-student sex?" Whistleblower Magazine, March 1, 2006 ---

On average, what is the increase in technology spending expected for higher education?

Technology spending by colleges and universities is expected to increase by 35 percent, to $6.9 billion, in 2006, according to a report by Market Data Retrieval. The report found increases in all sectors of higher education. Hardware purchases represent about half of all spending.
Inside Higher Ed, February 28, 2006 ---

Listening to Student Voices on Technology

March 1, 2006 message from Bob Blystone

You might find the referred to 21 page report concerning student use of computers very interesting. It concerns high school students primarily.

Bob Blystone

Jensen Comment
I had trouble with the link because of the way it truncated in Bob's message.
The link is
I snipped it to
Bob Jensen

The "Oops" List (includes photographs of crashed airplanes and other "Oops" happenings --- Many of the photographs and cartoons on the “Oops” list will be familiar. You may not have seen some of these images, some of which are hilarious.
The "Oops" List  (some links are video links) --- 

The "Oops" impact of labor unions of California politics:  Some Cities and Counties Will Declare Bankruptcy

"Chickens Roosting:  At Home Legislative slaves of public employee unions," by Ray Haynes,, February 27, 2006 ---

From 1999 through 2002, I was the Vice Chair of the Senate Public Employment and Retirement Committee. During that time, a number of bills presented to the committee increased pension and retirement benefits for state and local government employees. Every single one of these bills were passed and signed by Governor Davis.

At the hearing on each of these bills, the lobbyists for the government employee unions showed up and begged the committee members to vote for the bill. In addition, the representative for the California Public Employee Retirement System (CalPERS) told the committee that the retirement system could afford the increases because it had a $60 billion surplus. The surplus was so big that the state did not have to pay any money to the CalPERS fund, and CalPERS told us we would never have to pay into the retirement system ever again, even with the benefit increases. Of course, the government employee unions control the CalPERS board. The state was experiencing record budget surpluses, so everyone thought that the good times would last forever.

I kept trying to explain to my legislative colleagues that we were being foolish. No one can increase benefits without some cost. At some point, I said, these pension chickens were going to come home to roost in our budget. My colleagues called me Chicken Little telling me “the sky is not falling.” They said the pension was sound and the budget could absorb the cost.


The chickens have come home to roost. The City of San Diego is going bankrupt from generous pension benefits. Orange County is talking seriously about filing bankruptcy again to get out from underneath their pension requirements. The state’s contribution to CalPERS is estimated to be $3.5 billion this year, and even higher next year. This is from nothing in 1999.

And this week, the Legislative Analyst’s Office released a report that the cost of retiree health benefits will be “in the range of $40 billion to $70 billion, and perhaps more.” The report identifies two reasons for this increased cost; (a) increased health care costs; and (b) legislatively mandated increased health benefits.

Health care costs have increased significantly in the last six years for one reason: legislatively mandated minimum requirements for health care. From 1999 to 2000, the Legislature passed over 30 different mandates on health insurers, and as a result, costs increased over 40%.

Continued in article

Bob Jensen's threads on the economic disasters of entitlement programs are at

Another "oops" of Congress allows the rich to get tax benefits not intended for the rich

"New Definition Of a 'Child' Causes Outcry:  Congress's Move to Simplify The Tax Code Creates Loophole For Some Wealthy Families," by Tom Harman, The Wall Street Journal,  March 1, 2006; Page D1---

Defining the term "child" sounds simple -- except at tax time.

There are at least five different tax breaks tied to children and until recently, the tax code had a separate test for each. Recognizing the absurdity and inefficiency of that, Congress enacted legislation in late 2004 streamlining the definition of a child. The new system took effect for 2005 tax returns, which people are preparing now.

But the new law has ended up creating loopholes allowing some high-income families to get tax benefits that weren't intended for them -- such as the earned-income tax credit, which is intended for low-income workers. At the same time, some low-income families are finding themselves unable to claim benefits that they should be getting.

Continued in article

March 1, 2006 reply from Linda C Pfingst CPA [lcpfingst@EARTHLINK.NET]

In the example cited:
 Francis Degen, president of the National Association of Enrolled Agents, which represents about 40,000 private-sector tax specialists, offered this example: A couple with two children living at home -- a 14-year-old daughter and a 22-year-old son -- file a joint return with adjusted gross income of $400,000. At that level of income, the parents don't get any tax benefit from claiming the daughter as a dependent. On the other hand, the son, who has $15,000 in wages and isn't a full-time student, can claim his sister, enabling him to receive the child-tax credit and earned-income tax credit. Assuming he had no tax withheld, this turns what would have been a balance due of $683 on his return to a federal income-tax refund of $3,158.
I don't see how the son can claim his sister as a dependent when he must fail "test to be a qualifying relative part 4 - you must provide more than half of the person's total support for the year." I have a 16 year old son, who in no way would give his hard earned bucks (he pumps gas) to his sister! See IRS Pub 17 page 25 chapter 3.
What am missing something here? 


How much more is the cost of a U-Haul trailer to move from Los Angeles to Boise versus the vice versa?

It takes hard work to drive anyone away from California's sunshine and scenic vistas, but politicians in Sacramento have been up to the task. The latest Census Bureau data indicate that, in 2005, 239,416 more native-born Americans left the state than moved in. California is also on pace to lose domestic population (not counting immigrants) this year. The outmigration is such that the cost to rent a U-Haul trailer to move from Los Angeles to Boise, Idaho, is $2,090--or some eight times more than the cost of moving in the opposite direction. What's gone wrong? A big part of the story is a tax and regulatory culture that treats the most productive businesses and workers as if they were ATMs. The cost to businesses of complying with California's rules, regulations and paperwork is more than twice as high as in other Western states. But the worst growth killer may well be California's tax system. The business tax rate of 8.8% is the highest in the West, and its steeply "progressive" personal income tax has an effective top marginal rate of 10.3%, or second highest in the nation. CalTax, the state's taxpayer advocacy group, reports that the richest 10% of earners pay almost 75% of the entire income-tax revenue in the state, and most of these are small0business owners, i.e., the people who create jobs.
"Meathead Economics:  Hollywood liberals drive productive Californians to leave the state," The Wall Street Journal, February 28, 2006 --- 

What is the impact of low fat diets on older women?
Hint: It "won't cut their risk of cancer or heart disease." (with calorie intake held constant)

Older women who reduce the amount of total fat in their diets won't cut their risk of cancer or heart disease, but some women might benefit from lowered fat intake. So says a School of Medicine researcher who helped direct the much-publicized Women's Health Initiative, which followed test subjects for 15 years . . . But a School of Medicine researcher who helped direct the WHI work said the study showed a modest reduction in breast cancer among the women who started with the highest fat intake before cutting back. And the findings also suggested a health benefit for women who reduced their consumption of saturated and trans fats. "Just switching to low-fat foods is not likely to yield much health benefit in most women," said Marcia Stefanick, PhD, professor of medicine at the Stanford Prevention Research Center and chair of the WHI steering committee. "Rather than trying to eat 'low-fat,' women should focus on reducing saturated fats and trans fats." She also recommended that women eat more vegetables, in particular dark, leafy greens and cruciferous vegetables, though the trial did not specifically study these foods.
Susan Ipaktchian, "Low-fat diet no panacea for preventing cancer for women But some adjustments in fat intake may benefit certain women, study author says," Stanford University News Service, February 8, 2006 ---

Do you have health questions?

I usually recommend WebMD.  But some of you may prefer the site called "Go Ask Alice" ---

In particular check out Alice's archives?

"Will WebMD's Healthy Glow Last?" by Arlene Weintraub, Business Week, February 23, 2006

The Net health-care concern has been a hit on the Street since being spun off last year.  Now its numbers have to back up the optimism

Just days after Google (GOOG) raised a staggering $4 billion in a September secondary stock offering, another brand-name dot-com made a much quieter, but equally impressive splash on Wall Street.  Health-information provider WebMD Health (WBMD) spun out from its parent company on Oct. 4, raising $129 million.  Shares of its stock have nearly doubled to $34.92 since then (as of the market close on Feb. 22).

Updates from WebMD ---


Why aren't physicists as rich as Warren Buffet?
On Monday, October 19, 1987 – infamously known as “black Monday” – the Dow fell 508 points, or 22.9%, marking the largest crash in history. Using an analytical approach similar to the one applied to explore heart rate, physicists have discovered some unusual events preceding the crash. These findings may help economists in risk analysis and in predicting inevitable future crashes.
"Physicists Predict Stock Market Crashes," PhysOrg, February 24, 2006 ---

Jensen Comment
If physicists can predict market crashes, why aren't they short selling at the right moments to become as rich as Warren Buffet? The problem in all time series models of stock market prices lies in evaluating the false positives and negatives. I always tell my students that the Wizard can predict every stock market crash because the Wizard is always predicting stock market crashes. The studies cited above, however, are much more scholarly and worth reading.

Fraud at Harvard
In a legal settlement reached last summer, Harvard agreed to pay $26.5 million

Did fraud by a Harvard professor ultimately sink its President Summers?

"Did an Exposé Help Sink Harvard's President?" by Sara Ivry, The New York Times, February 27, 2006 ---

"I was surprised that he was gone by February of '06," said Mr. McClintick, and "that it happened as rapidly as it did."

"How Harvard Lost Russia" was published in the January issue of Institutional Investor magazine, a subscription-only publication, about a month and a half before Dr. Summers's resignation, which he announced last Tuesday. The move came just two weeks after a Feb. 7 meeting when the president was challenged on several issues, including his reaction to events described in Mr. McClintick's article.

In roughly 18,500 words, (22,007 including sidebars), Mr. McClintick chronicled financial improprieties by those in charge of Harvard's Russia project, including Andrei Shleifer, a professor of economics who is a friend and protégé of Dr. Summers's, and Jonathan Hay, a Harvard-trained lawyer. The two men were accused of making personal investments in Russia at a time when they were working under contract to establish capitalism in the former Soviet nation.

Their behavior led the United States government to file civil charges against Harvard, Mr. Shleifer and Mr. Hay for fraud, breach of contract and making false claims. In a settlement reached last summer, Harvard agreed to pay $26.5 million. Mr. Hay was ordered to pay a fine based on his future earnings and Mr. Shleifer agreed to pay $2 million, though none of the parties admitted wrongdoing. Mr. Shleifer has not been subjected to any disciplinary action from Harvard.

Some Harvard watchers attribute that to Dr. Summers's influence, though he formally recused himself from the matter, and they see the entire affair, assiduously detailed by Mr. McClintick, as an indelible stain on Harvard's reputation.

Mr. McClintick, 65, a 1962 graduate of Harvard, is a former reporter for The Wall Street Journal and the author of several books, including "Indecent Exposure," which investigated financial scandal at Columbia Pictures. That book was a finalist for the National Book Award and helped solidify Mr. McClintick's reputation as a meticulous investigator.

Continued in article

Update on March 8, 2006|
Harvard University's faculty-ethics board is investigating Andrei Shleifer, a star in its economics department star who was caught up along with the school in a scandal that involved investing in Russia, according to a person familiar with the matter. Prof. Shleifer and Harvard last year paid nearly $30 million to settle a civil suit brought by the U.S. government alleging that Prof. Shleifer violated federal conflict-of-interest rules by investing in Russia. The case dates back a decade when Mr. Shleifer headed a U.S.-government-funded Harvard project to help Russia develop financial markets
John Hechinger, "Harvard Investigates Conduct Of a Star Economics Professor," The Wall Street Journal, March 8, 2006; Page A6

Bob Jensen's threads on the Harvard fracture are at

Bob Jensen's updates on fraud are at

Whenever you wanted Internet access, you wouldn't have to hunt for a wireless coffee shop
or pay $24 a night to your hotel.

"Wi-Fi to Go: The Hot Spot in a Box," by David Pogue, The New York Times, February 23, 2006 ---

YOU know what would be so cool? A portable Wi-Fi hot spot. Whenever you wanted Internet access, you wouldn't have to hunt for a wireless coffee shop or pay $24 a night to your hotel.

Instead, you'd travel with a little box. Plug it into a power outlet — or even your car's cigarette lighter — and boom, you and everyone within 200 feet could get onto the Internet at high speed, without wires.

Actually, such boxes exist. They come from companies like Kyocera, Junxion and Top Global, and they're every bit as awesome as they sound. (Unfortunately, the category is so new that it has no agreed-upon name. "Portable hot spot" is descriptive but unwieldy. "Cellular gateway" is a bit cryptic. Kyocera's term, "mobile router," may be as good as any.)

Before you start thinking that you've died and gone to Internet heaven, however, you should know that these boxes don't work alone. Each requires the insertion of a PC laptop card provided by a cellular carrier like Verizon, Sprint or Cingular. The card provides the Internet connection, courtesy of those companies' 3G ("third generation") high-speed cellular data networks. The box just rebroadcasts that connection as a Wi-Fi signal so that all nearby computers — not just one privileged laptop — can go online.

With those PC cards, you can go online anywhere there's a cellular signal: in a taxi, on a bus, in a waiting room or wherever. In major cities, the speed is delightful, like a D.S.L. or slowish cable modem (400 to 700 kilobits a second). In other areas, you can still go online, but only slightly faster than with a dial-up modem. (Also note that uploading is far slower than downloading.)

Continued in article

WiFi Internet Access Across All of London
The service is expected to go live within the next few months, and the entire city will be covered within six months, according to the network's provider.
K.C. Jones, "Wi-Fi Moving To London," InformationWeek, February 23, 2006 ---

From The Washington Post on February 24, 2006
A university in what city banned campus-wide Wi-Fi?

A. Barcelona, Spain
B. Thunder Bay, Ontario
C. Harbin, China
D. Odessa, Ukraine

Meanwhile broadband is not so great in the United States
The laissez faire approach taken by the United States in developing the nation's broadband network has failed. Not only have we fallen since 2000 from number three to number 16 in the number of high-speed Internet subscribers per capita, but there's a good chance we'll fall out of the top 20 this year. The reason is our government's failure to oversee the building of the broadband infrastructure and to provide the subsidies needed to get as many people online as possible. Unlike other developed nations, we haven't taken an approach that would reflect a belief that universal access to the high-speed Internet is a critical component of a competitive economy.
Antone Gonsalves, InternetWeek Newsletter, February 23, 2006

How to Spot a She Nerd

"Anatomy of a Nerd ," Wired News, Marchj 2006 ---

From Walt Mossberg's Mailbox, The Wall Street Journal, February 23, 2006; Page B4 ---

Q: Can I convert my home videos so they will play on a video iPod? If so, how?

A: Probably, though it depends on whether they are in one of the formats that can be easily converted, and it can be hard to tell in advance. You'll need conversion software to do it. One option, for both Windows and Mac users, is to spend $30 to upgrade Apple's free QuickTime media player to the pro version, which can convert numerous video file types to an iPod-compatible format.

Another option is to download one of many free conversion utilities that appeared on the Web after the video-capable iPod was released. For Windows users, there are numerous choices. One example is Free iPod Video Converter, at If you use a Mac, one such program is iSquint, at I haven't tested either.

Q: I like to visit about 50 news sites every morning but don't want an RSS feed only. I like to see the entire site. Is there a way to open all of them at the same time, without having to click on each bookmark one by one?

A: Certainly. All you need to do is switch to a tabbed Web browser, like Firefox or Opera for Windows or Mac; or Safari or Camino, for the Mac only. These browsers can open multiple Web sites, in the same window, marking each site with a tab bearing its name. And they allow users to open these multiple sites with a single click. Though each differs slightly, all have a command -- usually called "Open in Tabs" -- that will open a list or folder full of bookmarks with one click. For instance, every morning I open about 20 technology-related Web sites in Firefox or Safari with one click.

Q: I would like to purchase a laptop computer in the U.S. but use it for extended periods in Europe. Is there anything I have to modify because of the difference in the electrical power supply?

A: Most laptops I have tested in recent years have power adaptors that can handle both U.S. and European electrical standards. Just make sure the one you choose is similarly equipped. The only thing you'd have to buy is a cheap plug adapter -- not a transformer -- to physically fit the plug into the sockets used in the European countries where the laptop will be used.

Using microbes to create alternative fuels

"Craig Venter's Next Little Thing: The man who mapped the human genome has a new focus: using microbes to create alternative fuels," by Michael S. Rosenwald, The Washington Post, February 27, 2006 --- Click Here

"The Methanol Economy Forget about the hydrogen economy:  Methanol is the key to weaning the world off oil. George Olah tells us how to do it," by Kevin Bullis, MIT's Technology Review, March 2, 2006 ---,296,p1.html

This is a huge book of statistical data that will probably attract your interest and be of great value within reach of your desk.

"A Book for People Who Love Numbers," by Sam Roberts, The New York Times, February 22, 2006 ---

For starters, it weighs 29 pounds. It has five volumes. And it's densely packed with more than a million numbers that measure America in mind-boggling detail, from the average annual precipitation in Sweet Springs, Mo., to the wholesale price of rice in Charleston S.C., in 1707

. . .

Professors Sutch and Carter, who are married and both teach at the University of California at Riverside, are editors in chief of Historical Statistics of the United States, an ambitious expansion of previous compilations that were published by the United States Census Bureau in 1949, 1960 and 1975. This "Millennial Edition" is a privatized version, authorized by the Census Bureau but published by Cambridge University Press.

Since the last edition, the editors write, they have tried to rationalize the "phenomenal growth of the American quantitative record," which is why Historical Statistics has proliferated to more than 5,000 pages, from 1,235 in the last version, and includes new chapters on slavery, poverty, American Indians, the Confederacy and the nation's territories overseas.

"As time goes on, the statisticians and the bureaucrats who produce a lot of these numbers for the government keep producing new data," Professor Sutch said. "The other thing is that scholars have really jumped into the field. They are going back and trying to reconsider all sorts of issues with new perspectives, and one of those perspectives is a quantitative one."

The new edition, which sells for $825 and is also available in an online version, is a gold mine for scholars, students and assorted nerds and numbers crunchers, although, as with a gold mine, exposing the veins and nuggets can be challenging. Some tables are not comparable, many do not include percentages, and some contemporary tables are current only to 1990.

"The whole project was designed to present data in raw form rather than highly manipulated," Professor Sutch said. "That makes it more difficult. You have to do a little work to use this."

The couple have been working on the revised collection for 11 years, although they estimate that more than half that time was spent in fund-raising. (Cambridge says the book cost more than $1 million to produce.) What statistics surprised them?

"We're the wrong people to ask about what's surprising," Professor Carter said. "We've been working on it so long."

Historical Statistics of the United States is a product of collaborative scholarship. Introductory essays by contributors provide context and some navigational tools, and hint at trends.

Professors Charles Hirschman, Reynolds Farley and Richard Alba point out in their essay, for instance, that while only 1.9 percent of Americans 18 and older claim two or more racial identities, 4 percent of those younger than 18 do.

A discriminating browser can also learn, or be reminded, that:

Fewer than 1 in 10 black children under 5 live with both parents; workers with the highest hourly wages now work the longest hours; there are more religious workers (also bartenders, gardeners and authors) than ever recorded, and more shoemakers than at any other time since the Civil War; only half of Americans have access to fluoridated water; a growing share of poor people live in the suburbs; philanthropy compared with the gross domestic product has been declining since 1960; more Protestants and Jews say they attended religious services within the last week than at any time in the last 50 years; the nation is producing record amounts of broccoli; it took four days on average to travel between New York and Boston in 1800; attendance at horse-racing tracks peaked in 1976, but rodeo attendance is at an all-time high; and the proportion of people who have no opinion in presidential approval polls is the lowest in a half century.

"It's not just a data dump," Professor Carter said. "Believe it or not, we've been really highly selective."

The editors write that research for the new edition "exposed many lacunas in the statistical record." For example, Professor Sutch said, "On immigration we have a lot of good data on how many people arrived, but very bad data on how many left."

The couple do their own taxes and balance their own checking account, but they were not trained as statisticians. Professor Sutch, 63, and Professor Carter, 58, are both economic historians.

"Readers may be surprised that the critical skill that's more required than formal statistics is more like literary criticism," Professor Carter said. "You look at a number and don't say that's a fact. You want to say where did it come from, who generated it, why, is it consistent with what we would get from looking at other sources, does it make sense? What sort of insight can the quantitative record give to the qualitative one?"

Historical Statistics of the United States: Millennial Edition, 5 Volume Set, Susan Carter (Editor), Michael R. Haines, Scott Sigmund Gartner, Gavin Wright (Editor), Susan B. Carter (Editor) --- Click Here

Bob Jensen's threads on economic statistics are at

Will it ever be possible to audit Pentagon spending?

Answer:  Never!

"Pentagon Bookkeeping Stops Auditors," AccountingWeb, February 20, 2006 ---

The Department of Defense (DOD) has failed its audit to the extent that auditors have stopped wasting money trying to audit their books, according to Black Enterprise. Problems with the Pentagon books has allowed the DOD to pay troops, civilian workers, and contractors the wrong amounts; to lose track of equipment, such as planes and tanks; and to document trillions of dollars in transactions improperly, according to Black Enterprise. Gregory D. Kutz, managing director of the General Accounting Office (GAO), told Congress last summer that these accounting problems would cost taxpayers $13 billion in 2005. The GAO is the investigative arm of Congress.

The “clean audit” of DOD books scheduled for 2007 is not in sight, according to Black Enterprise. The DOD has received a “clean opinion” on only 16 percent of its assets and 49 percent of its liabilities as of June 2005, according to Thomas B. Modly, deputy undersecretary of defense for financial management. Black Enterprise reported that Modly said the DOD hopes to settle their balance sheet on 47 percent of assets and 49 percent of liabilities by 2007. It might help to understand the problem by understanding the size of Pentagon operations. Black Enterprise reports it had in fiscal year 2005:

  • $1.3 trillion in assets
  • $1.9 trillion in liabilities
  • 3 million in personnel
  • $635 billion in operational costs
  • 2,569 facilities in the country and 807 outside of the United States

One of the other problems cited is that DOD has about 5.2 million items in its inventory, according to Modly. Wal-Mart only has 11,000 and Home Depot only has 50,000 inventory items, according to Black Enterprise. Another problem is the gridlock of some 4,150 different business operations, including 713 different human resources systems.

Jack Minnery, a Defense Finance and Accounting Service accountant, told Black Enterprise, “The Pentagon wasn’t in the business of making money, so they never needed an income statement. They expensed their assets like planes and buildings and such. They dished money out, and they never kept track of what they owned.” Minnery continued, “That’s one of the main reasons I don’t believe they’ll ever have a clean [audit].” Minnery complained about missing money in 2002 to earn his label as a whistle-blower.

Minnery told Black Enterprise, “Their systems can’t keep track of who they’ve sold stuff to, who owes them, who they owe.” Concerning the inter-service gaggle of ordering codes, Minnery said, “The Navy has a set of [codes], the Army has a set, the Air Force has a set. They don’t have the same number of digits, and they don’t match each other.”

In 1990, the GAO started assigning some government agencies to a “high risk” list. DOD’s supply chain and weapon systems acquisitions have remained on this list since that time and six other defense divisions made the list in 2005. Danielle Brian, executive director of the watchdog group Project on Government Oversight, told Black Enterprise, “Nothing’s gotten better. It keeps getting worse.” reports that Jeffrey Steinhoff, GAO’s managing director for financial management and assurance, said, “They’re not close to the finish line. They have a long way to go.”

Untangling the mess has seemed elusive except “by making the business process support the war-fighter more effectively, we are seeing a significant amount of momentum,” according to Paul Brinkley, deputy undersecretary of defense for business transformation. Effective might be an overly optimistic opinion as Black Enterprise reports that the government spent $179 million on two automation systems meant to resolve disbursement problems that failed, according to the GAO.

Winslow T. Wheeler, director of a military reform project at the Center for Defense Information (CDI), told Black Enterprise, “We don’t know how badly managed it is. It’s not that DOD flunks audits, it’s that DOD’s books cannot be audited. DOD aspires for the position where it flunks an audit. If this were a public company, it would have gone belly up before World War II.” CDI is an independent monitor of the military.

In more wasteful news, Stuart Bowen, special inspector general for Iraq reconstruction, told Political Gateway that $8.8 billion is unaccounted for due to inadequate oversight from Coalition Provisional Authority (CPA) that “was relatively nonexistent.” Bowen is in charge of tracing the funds.

Frank Willis, the former number two official at the CPA transportation ministry, told Political Gateway that the CPA kept billions in cash to pay for its projects because Iraq is without the financial infrastructure that would support the use of checks or money orders. Willis said, “I would describe (the accounting system) as nonexistent.” Willis told a CBS interviewer, “Fresh, new, crisp, unspent, just-printed 100-dollar bills. It was the Wild West.”

In other wasteful news, the GAO has released a report finding that the Bush Administration spent more than $1.6 billion in public relations and media contracts over two and a half years, according to the California Chronicle. Congressman Henry A. Waxman, (D-Calif.), House Democratic Leader Nancy Pelosi, (D-Calif.), and Congressmen George Miller, (D-Calif.), and Elijah E. Cummings, (D-Md.), with other senior Democrats, released the report.

More bad news is continued at

Army to Pay Halliburton Unit Most Costs Disputed by Audi
The Army has decided to reimburse a Halliburton subsidiary for nearly all of its disputed costs on a $2.41 billion no-bid contract to deliver fuel and repair oil equipment in Iraq, even though the Pentagon's own auditors had identified more than $250 million in charges as potentially excessive or unjustified. The Army said in response to questions on Friday that questionable business practices by the subsidiary, Kellogg Brown & Root, had in some cases driven up the company's costs. But in the haste and peril of war, it had largely done as well as could be expected, the Army said, and aside from a few penalties, the government was compelled to reimburse the company for its costs. Under the type of contract awarded to the company, "the contractor is not required to perform perfectly to be entitled to reimbursement," said Rhonda James, a spokeswoman for the southwestern division of the United States Army Corps of Engineers, based in Dallas, where the contract is administered.
James Glanz, "Army to Pay Halliburton Unit Most Costs Disputed by Audit," The New York Times, February 27, 2006 ---

Interactive simulation of how sensitive the Federal Budget is to changes in military spending --

What has been one of the most massive, if not the most massive, fraud in the history of the U.S. (aside from Department of Defense ongoing fraud discussed above)?

The attorney/physician rip off on phony asbestos health damage claims. 

"Diagnosing for Dollars A court battle over silicosis shines a harsh light on mass medical screeners—the same people whose diagnoses have cost asbestos defendants billions," by Roger Parloff, Fortune, June 13, 2005, pp. 96-110 ---,15114,1066756,00.html

How, then, to account for this: Of 8,629 people diagnosed with silicosis now suing in federal court in Corpus Christi, 5,174—or 60%—are "asbestos retreads," i.e., people who have previously filed claims for asbestos-related disease.

That anomaly turns out to be just one of many in the Corpus Christi case that sorely challenge medical explanation. At a hearing in February, U.S. District Judge Janis Graham Jack characterized the evidence before her as raising "great red flags of fraud," and a federal grand jury in Manhattan is now looking into the situation, according to two people who have been subpoenaed.

The real importance of those proceedings, however, is not what they reveal about possible fraud in silica litigation but what they suggest about a possible fraud of vastly greater dimensions. It's one that may have been afflicting asbestos litigation for almost 20 years, resulting in billions of dollars of payments to claimants who weren't sick and to the attorneys who represented them. Asbestos litigation—the original mass tort—has bankrupted more than 60 companies and is expected to eventually cost defendants and their insurers more than $200 billion, of which $70 billion has already been paid.

The odor around asbestosis diagnosis has been so foul for so long that by 1999, professor Lester Brickman of the Benjamin N. Cardozo School of Law was referring to asbestos litigation as a "massively fraudulent enterprise." At the request of his defamation lawyer, Brickman says, he toned that down to "massive, specious claiming"

Continued in the article

Bob Jensen's working paper on the history of fraud in the U.S. is at

Bob Jensen's updates on fraud are at

Why Cancer Strikes Some
It's a conundrum that puzzles doctors and patients alike: one person smokes a few cigarettes per week in college and contracts lung cancer in middle age, while another person smokes a pack a day his whole life -- and lives to age 90. A new program announced last week by the National Institutes of Health aims to unravel such mysteries by precisely measuring the role that environmental agents, such as pesticides and solvents, play in common diseases, including cancer, asthma, and autism. A major part of the program will fund the development of technologies to monitor personal environmental exposures and to determine how those exposures interact with an individual's genetic makeup to increase the risk for disease. Scientists hope these technologies will allow doctors to determine who is at risk early on, and thus be able to intervene.
Emily Singer, "Why Cancer Strikes Some:  New ways to gauge an individual's response to environmental toxins will help scientists understand susceptibility to disease," MIT's Technology Review, February 16, 2006 ---,304,p1.html

So who are usually the master chefs cooking the accounting books and what is their main reason?

Answer:  The executives wanting fat bonuses

What is the typical ploy?

Get the fat bonus and then issue revised financial statements. Who ever heard of executives having to give back the cash bonuses received after the financial statements are revised?

Besides Enron, look at big fat Fannie Mae
Investigators have uncovered new evidence that senior executives of Fannie Mae, the nation's largest buyer of home mortgages, manipulated its accounting in the 1990's to meet earnings projections so that top executives could receive more than $25 million in bonuses. In a 2,600-page report that was made public today, former Senator Warren Rudman and a team of lawyers and investigators concluded after an 18-month investigation that Fannie Mae's accounting practices "in virtually all of the areas that we reviewed were not consistent with" generally accepted accounting principles.
Stephen Labaton and Eric Dash, "
Report on Fannie Mae Cites Manipulation to Secure Bonuses," The New York Times, February 23, 2006 --- Click Here

Report protects the fannies of Fannie's Board of Directors: But executives are hit hard
They said the report criticizes Timothy Howard, the company's former chief financial officer, and Leanne G. Spencer, the former controller, for their roles in setting accounting policies. They added that the report focuses less criticism on Franklin D. Raines, the former chief executive, but says the company's management didn't keep the board adequately informed about accounting problems. (See related article)
James R. Hagerty, "
Fannie Report On Accounting Shields Board," February 23, 2006; Page A2 ---

Congress is our only native criminal class.
Mark Twain ---

The Culture of Corruption Runs Deep and Wide in Both U.S. Political Parties:  Few if any are uncorrupted
Committee members have shown no appetite for taking up all those cases and are considering an amnesty for reporting violations, although not for serious matters such as accepting a trip from a lobbyist, which House rules forbid. The data firm PoliticalMoneyLine calculates that members of Congress have received more than $18 million in travel from private organizations in the past five years, with Democrats taking 3,458 trips and Republicans taking 2,666. . . But of course, there are those who deem the American People dumb as stones and will approach this bi-partisan scandal accordingly. Enter Democrat Leader Nancy Pelosi, complete with talking points for her minion, that are sure to come back and bite her .... “House Minority Leader Nancy Pelosi (D-Calif.) filed delinquent reports Friday for three trips she accepted from outside sponsors that were worth $8,580 and occurred as long as seven years ago, according to copies of the documents.
Bob Parks, "Will Nancy Pelosi's Words Come Back to Bite Her?" The National Ledger, January 6, 2006 --- 

February 24, 2006 reply from Ramsey, Donald [dramsey@UDC.EDU]

Someone said that Martha Stewart did not cook the books. They did think she might sauté the books.

February 23, 2006 reply from Bender, Ruth [r.bender@CRANFIELD.AC.UK]

Doesn't S.304 of Sarbanes-Oxley say that they have to give the bonuses back?

I'm not being picky, it's a serious question. I'm currently doing some research for a client comparing SOX with the European 8th Directive, and so have just had the joy of reading the full text of both. My reading of SOX is that Fannie Mae's CEO and CFO would have to pay back the bonuses.

If that's NOT the case, would someone mind emailing me to point out my error please! Take it offline - 


February 24, 2006 reply from Bob Jensen

You may be right about this Ruth, although I don’t know of this ever happening before SOX. Also, if bonuses of given throughout a company, it may be hard to collect money back that’s already spent. Also it would get sticky if the accounting mistakes were truly accidents.


It would be far better if Congressional representatives had to give their take back in the case of Fannie Mae.


Bob Jensen

The findings come as Fannie Mae's regulator considers whether to force some former executives to return bonuses. And the report will not be the final word on the scandal: the Justice Department and Securities and Exchange Commission are still investigating former executives. Fannie Mae was run with "an attitude of arrogance," according to the report, which catalogs how the company violated accounting principles repeatedly to show stable earnings and less volatility. But the most troubling finding was that the company, rattled by falling interest rates in 1998, improperly delayed taking nearly $200 million in expenses.
Stephen Labaton and Eric Dash, "Loan Buyer Accounting Is Faulted," The New York Times, February 24, 2006 ---

February 24, 2006 reply from Linda Kidwell, University of Wyoming [lkidwell@UWYO.EDU]

Section 304 requires CEOs and CFOs to reimburse their companies for bonuses or other incentives earned as a result of statements later restated as a result of misconduct. Quoting from Robert Prentice's "Student Guide to the Sarbanes-Oxley Act" (page 28):

"Among several unanswered questions about this provision is how 'misconduct' should be construed. Does it require fraudulent intent or just recklessness or even some lesser wrong? . . . is the misconduct of underlings that the CEO and CFO are unaware of sufficient to require disgorgement?"

I suppose we'll have to let the courts interpret this one as time goes on.


February 24, 2006 reply from Bob Jensen

Hi Linda,

Thank you for the direct quotes. I suspect only very stupid executives will actually have to pay back any bonuses.

One can imagine all sorts of moral hazards here. For example, suppose CEO Jones (having a salary of $12 million per year) conspires with Green Eyeshade Lotus (having a salary of $21,000 per year) to fudge a journal entry resulting in a $500 million overstatement of earnings. Both secretly split Jones' bonus of $20 million. Of course the G.E. Lotus $10 million "gift" from his boss is deposited in a secret bank account in the Cayman Islands.

They're both in tall cotton unless the error gets detected and requires revision of the company's financial statements. If caught, Jones claims no knowledge of the mistake, and G.E. Lotus readily confesses that he very accidentally slipped a few digits. Of course he got no bonus so there's nothing to pay back. Jones announces to the media that G.E. Lotus has been fired. But that doesn't matter much to G.E., because he's soon eating lotus leaves in Tahiti. Jones keeps his half of the take because he is not even accused of misconduct.

Even if Jones had never met his employee G.E. prior to auditor discovery of the accounting error, Jones might seek out G.E. to take the fall ex post (for a$10 million gift). The problem with these kinds of deals in modern times is that the amount of money involved is so staggering.

Someday you may want to read one of my favorite short stories by Somerset Maugham. It's entitled "The Lotus Eater" ---
I'm a bit worried about a long life now that now that I'm retiring.

Excess on occasion is exhilarating. It prevents moderation from acquiring the deadening effect of a habit.
W. Somerset Maugham

Bob Jensen

February 24, 2006 reply from Patricia Doherty [pdoherty@BU.EDU]

All I want to know is, in my many years in corporate accounting before I joined academe, where were the people who were supposed to offer ME deals like this? What, do I look like a Goody-Two-Shoes or something?


February 24, 2006 reply from Bob Jensen

Hi Pat,

The reason is that CEOs don't make such deals to people like you Pat who spout quotations like the one below"

"In a house of gold, the hours are lead."


The CEO will always scout out a naïve bookkeeper who daydreams that a life nibbling on lotus leaves in a gold house is more fun over the long haul hour by hour day after day.

Put in another way, those are the bookkeepers, unlike you, who take Glen Gray to heart when Glen tried to convince a judge that the best jobs entail never having to wear anything but pajamas. I read somewhere (certainly it could not have been in Playboy Magazine) that Hugh Hefner has over 300 pairs of pajamas in his Playboy Mansion.

But I think that's because "He Don't Look Good Naked Anymore" in his house of gold or so he says (turn up the speakers) ---

Bob Jensen

"Fannie's Funny Business," The Wall Street Journal, February 24, 2006; Page A12 ---

The stock market seemed relieved yesterday when Warren Rudman's 2,652-page report into Fannie Mae's accounting troubles didn't report major new discrepancies in the mortgage giant's books. That news was enough to put the stock up about 2% on the day after a nearly 4% rise Wednesday ahead of the report's release.

And we suppose it is good news of a sort that Fannie Mae's accounting restatement, for which the world has been waiting for more than a year, won't grow from the $10.8 billion figure already estimated. But $10.8 billion is big enough as it is; WorldCom's fraud came to "only" $11 billion. The report's main findings paint the picture of a company that routinely flouted both the rules and law. Some conclusions from the executive summary give a flavor:

• "[M]anagement's accounting practices in virtually all of the areas that we reviewed were not consistent with GAAP, and, in many areas, management was aware of the departures from GAAP" (emphasis added).

• "[E]mployees who occupied critical accounting, financial reporting, and audit functions at the Company were either unqualified for their positions, did not understand their roles, or failed to carry out their roles properly."

• "[T]he information that management provided to the Board of Directors with respect to accounting, financial reporting, and internal audit issues generally was incomplete and, at times, misleading."

• "[T]he Company's accounting systems were grossly inadequate."

The report also identified one case, in 1998, where earnings were manipulated specifically to meet a bonus target. That one instance was a doozy, however; a $199 million amortization expense that went unreported in order to make sure management got its lush payday.

If Fannie Mae were a normal private company, it would be tarred and feathered faster than you can say "Enron." But Fannie Mae is not just another private company. It has a federal charter and an implicit guarantee from the government (read: taxpayers) of its debt. Which makes it all the more vital that Congress reduce the risk that Fannie Mae and Freddie Mac pose to our financial system and the federal fisc.

One of the Rudman report's more worrisome findings was that Fannie's derivatives accounting was wrong because Fannie claimed that its hedges exactly matched its risk exposure when it did not. Fannie has long claimed it is capable of perfectly hedging the interest-rate and prepayment risks in its $800 billion portfolio of mortgage-backed securities. The Rudman report found that that often was not true. But the report only looked at the accounting issues posed by derivatives and hedging, so the public still knows precious little about the extent of the portfolio risk.

The report lets former CEO Franklin Raines off lightly, blaming him mainly for a "culture" that tolerated the accounting abuses. But the core of that culture was a belief that critics -- including us -- could be dismissed and assailed because the company knew it had Congress bought and paid for. And judging by the laughably weak reform that Financial Services Chairman Mike Oxley passed through the House, it still does. If Republicans on Capitol Hill want to know why voters think they've gone native, the failure to rein in Fannie even after a $10.8 billion accounting scandal is Exhibit A.

Jensen Comment
Fannie Mae fired the KPMG auditing firm and is now spending over $140 million just to restate past financial statements. Most of the troubles center on FAS 133 rules for reporting derivative financial instrument hedges.

See Question 1 of Bob Jensen's Enron Quiz ---

Bob Jensen's threads on portfolio hedge accounting are at

For a running account on Fanny Mae's accounting problems with FAS 133 see

How to anticipate problems in the fast-growing market of credit derivatives?
Risk does not evaporate: After all the market diffusion of risk, somebody must end up bearing the risk
"The size of gross exposures and the extraordinarily large number of contracts suggest the scale of the unwinding challenge the market would confront in the event of the exit of a major counterparty," Timothy Geithner, president of the New York Fed observed in a speech yesterday. Mr. Geithner added that the 10 largest U.S. banks have about $600 billion in net potential credit exposure in the derivatives market, and that exposure represents about 20% of their total credit exposure. Banks have increased their exposure to the credit-derivatives markets by about 15% relative to their capital over the past five years.
Henny Sender, "Concerns Dog Credit Derivatives:  Industry-Group Symposium Explores Market Imbalances Bankruptcies,"
The Wall Street Journal, March 1, 2006; Page C3 ---

Bob Jensen's threads on credit derivatives are under the C-terms at

The Wall Street Journal Flashback, March 1, 1995
After a one-day flurry of nervousness surrounding the collapse of Barings PLC, financial markets returned to a nominal calm. The Dow Jones Industrial Average rose 22.48 to 4011.05, shy of its record high of 4011.74 reached Friday.

The settlements announced today, including the largest penalties ever imposed on individual auditors, reflect the seriousness with which the SEC regards the responsibilities of gatekeepers."

It took forever, but KPMG partners finally settle with the SEC on the really old Xerox accounting fraud
The Commission (SEC) has announced on February 22, 2006 that all four remaining defendants in an action brought against them and KPMG LLP by the agency in connection with a $1.2 billion fraudulent earnings manipulation scheme by the Xerox Corporation from 1997 through 2000 have agreed to settle the charges against them. Three partners agreed to permanent injunctions, payment of record civil penalties and suspensions from practice before the Commission with rights to reapply in from one to three years. The fourth partner agreed to be censured by the Commission. "This case represents the SEC's willingness to litigate important accounting fraud allegations against major accounting firms and their audit partners, even where the accounting was complex," said Linda Chatman Thomsen, the SEC's Director of Enforcement. "The settlements announced today, including the largest penalties ever imposed on individual auditors, reflect the seriousness with which the SEC regards the responsibilities of gatekeepers."

You can read more about the Xerox case and other KPMG woes at

Faculty Ambivalence:  Debates on Unionization of Faculty and Graduate Assistants
These strategies do not seem to have paid dividends. The PSC’s plan fizzled amidst widespread faculty ambivalence about (or even opposition to) defying New York State law, which prohibits strikes by public employee unions; a settlement on terms well short of the union’s “non-negotiable” demands appears imminent. At NYU, President John Sexton recently stated that striking graduate students would not receive 2006 teaching assignments; some of those who started off on picket lines have returned to their jobs. In retrospect, PSC and GSOC leaders probably erred in their hard-line rhetoric and actions. But the two organizations also illustrate — if in an exaggerated fashion — some of the pitfalls associated with academic unionization.
K.C. Johnson, "The Perils of Academic Unions," Inside Higher Ed, February 24, 2006 ---

Novel explored sexual politics among college students
Tom Wolfe, whose last novel explored sexual politics among college students, was named Thursday by the National Endowment for the Humanities to deliver this year’s Jefferson Lecture. Being selected for the talk is considered a top honor by the federal government for intellectual achievement. Wolfe’s campus-based novel, I Am Charlotte Simmons, was published in 2004. He is best known for earlier works, including The Bonfire of the Vanities, The Right Stuff, and The Electric Kool-Aid Acid Test.
Inside Higher Ed
, February 24, 2006 ---

Debates on Size:  Pomona College, Amherst, Rice, and Some Other Small Colleges Plan to Grow in Size
Pomona College, a Claremont McKenna neighbor, is planning to increase enrollment — currently 1,500 — by 10 percent. Amherst College has just unveiled a plan to increase the size of each entering class, currently 410-425 students, by another 15-25 students. Bryn Mawr College (total enrollment just over 1,200) is currently conducting a feasibility study about its enrollment size. Grinnell College last year decided to grow on-campus enrollments by about 150 students, to 1,500. And these moves — all of which involve creating faculty slots as well — follow shifts involving even larger numbers of students at places like Middlebury and Gettysburg Colleges. Other colleges have resisted the trend. The president of Haverford College set off an intense discussion on the campus last year with his suggestion that the institution consider expansion. Plans circulated to add several hundred students. With many students and professors opposed to the idea, Haverford is staying put at 1,150.
Scott Jaschik, "Size Matters," Inside Higher Ed, February 24, 2006 ---

February 24, 2006 reply from Susan Baker

In case you have not heard, Rice U is proposing an increase of up to 30% in its undergraduate student body.

Susan Baker

Wright said he does not fully agree with the suggestion that Dartmouth is less visible. Still, he acknowledged that the College's size and location might present challenges that its larger, urban peers do not face. "We compete very well because we stay focused on what we do," Wright said. "We understand that our niche is to provide an exceptional undergraduate education -- the strongest in the country." Wright said bigger institutions are not necessarily better and that there was a particular "magic" about Dartmouth. He added that the College has name recognition "for those people who count a lot" -- potential students and parents and faculty.
Dax Tejera, "Wright looks to future, $1.3 billion in fundraising," The Dartmouth, March 3, 2005 ---

When you start the college search, there are a lot of different qualities to look into when trying to find the ever elusive "perfect school." You debate on the college's size, strong majors and departments, location, and guy/girl ratio (something I should have taken more careful notice to). But who looks into the "unofficial campus day of nakedness?" I know I sure didn't. It was definitely a surprise to me, coming in as a wide-eyed freshman, when I was approached by a few smug upperclassmen, asking me if I was going to participate in May Day. May Day? Who cares about May Day? It's just another weird holiday marked down in my planner book. I never got off from school for it; why should it be significant to me? And when they further explained this phenomenon that seems to happen only in Chestertown (well, at least in terms of college campuses), I was pretty shocked. How did it start? Where did the idea come from? And why is getting naked a factor in this whole crazy day? I decided to go to the most reliable source in order to find the answer to my questions: a giant mass blitz to all four grades. Surely somebody had to know something; there had to be some knowledge to be passed on. Only moments later, I started getting my first responses back; after a couple of hours, I had a little over a dozen. The answer? "Talk to Professor Lamond."
Sara Wuillermin, The Collegian, May 2002 ---

Jensen Comment
The above piece by Sara Wuillermin is also interesting from the standpoint of her poetry class and nudity events on campus.

And just because I love my readers so much (yes, all five of you are very special to me) I took the next step and approached the founding father who gave us a day of freedom from synthetic fabrics and itchy clothes. After my afternoon chat with the good professor, my eyes were opened to all things May Day.

It began in 1968 in a 10:30am Forms of Lit. and Comp. class. Spring had found its way to Chestertown, and it was the perfect time for Professor Lamond's class to study "Carpe Diem" poems-Herrick's "Gather Ye Rosebuds While Ye May," "Corrina's Gone A Maying," Hopkins's "Spring." Who knows if it was the poetry that inspired one of Lamond's students or if it was the whole idea of seizing the day, but, at any rate, Peter Hellar seized the opportunity (horrible pun intended) to ask the question that changed Washington College forever: "Instead of just reading about these poems, why don't we do these poems?"

So Lamond made his way to Fox's Five and Dime to buy crepe paper in order to decorate the first May Pole. The students helped in the preparations as well. One student brought his guitar to provide music, while another walked throughout Chestertown and picked a single flower from every lawn. And when the time came, the class made their way to the site where the May Pole stood, a spot that was not directly on campus at the time, where the CAC and Fine Arts center now are. There were strawberries, there were Chips Ahoy cookies, there were beverages, but was there nudity? Not unless you count bare feet.

I know, I know you're waiting for the "good parts" (aren't I the ultimate jokester with the puns?) when May Day got crazy and became the foundation for students today who like to bare all and be free. But that wasn't in the agenda on this first celebration on campus. It happened the second time around, but not during Lamond's class time frolic. We can thank for the nakedness a half dozen guys who decided to show more than their free spirits after the official festivities were over.

When Lamond's class was done May Daying it up, they decided to leave their May Pole standing, as a symbol of their celebration. Plus it looked too damn nice to tear down. Hours later, a group of males students decided to transport the pole to the front of Hodson Hall, where they stripped down to their bare nothingness and showed their own appreciation of the rejuvenation of spring. (There's still speculation as to whether or not these gentlemen were Sigs ...) Ever since this point, the spirit of this liberating tradition seems to ring true through many of the students of WAC. It wasn't until the mid-70s that the women finally started participating in the event, and, as always, the ladies made sure to show up the men's efforts. Jaime Lang remembered hearing, "a girl rode down what used to be the old caterwalk naked, on a motorcycle, with her friend, arms outstretched on the back" Lamond confirmed the story, noting, "They revved their way right up".

Nicole Mancini recalls how she first heard about the day: "I think I originally heard about May Day's origin freshmen year. A bunch of us were sitting around in the Dining Hall (back when we actually liked the food) talking about it ... I remember hearing stories of the 'Naked Games' and things like that."

And her thoughts about the modern day attempts? "Now it seems that a lot of the fun has disappeared due to so many lacking the confidence to 'strut' their stuff. But the craziest May Day happening? When that naked guy fell down the flagpole and had to be rushed to the hospital. Talk about ... uhh ... entertainment!"

Stephanie Coomer was skeptical when she first heard about the event: "My dad went to WAC, too, and he was the first person to tell me about May Day. I didn't really believe him 'cause he tends to be a fibber, but when I was a sophomore, I finally realized the truth about May Day (I was sleeping out for HFS festival tickets freshman year). The first thing I saw when I walked out of the dorm was a naked Jay Maschas ... That's when I knew it was real."

Catherine Dowling praises the grand spring event: "May Day is great. I lived in Kent, the dorm which I feel best captures the spirit of May Day every day. Anyone who has lived there knows what I'm talking about: Kent is like its own country. And May Day is the national holiday. The Kent people usually didn't feel weird about doing May Day because it was a part of life there."

But Dowling has some pet peeves about the day as well: "My least favorite part of May Day is all the people who come to the flagpole just to watch. I understand that the naked people have it coming because, let's be honest, who wouldn't be curious about such a spectacle? But it is still kind of creepy to have that huge sea of people just standing there staring. C'mon, put down those cameras, and join in! Don't be afraid, let loose and enjoy one of the few moments in life when you can run around buck ass naked and not get arrested. I know some people hate May Day, but it is not meant to offend. It's all in fun, and it's just about doing something crazy and a little naughty before you get out in the real world, where I hear they don't condone public nudity."

Our Kent correspondent also recalls some May Day legend: "The craziest story I've heard is that one year a naked guy made the mistake of being naked in the street and got arrested. Apparently his friends surrounded the police station, yelling "free naked guy!" until the police let him go. I don't know how much of this is true, but I like the happy ending."

Well Catherine, it is true. The boy was known as Miami, and while trying to cross Washington Avenue, a car swerved to miss his nakedness. Miami was charged for his public display of nudity and for causing the accident, and was taken in, still completely in the buff. Upon hearing the news, one of the Deans went down and gave the boy his sweater, which did everything but cover up what needed to be. Soon, a fully- clothed group of students followed the Dean to the station and screamed to the officers, "Free Miami!" But the story doesn't end there The Kent County News heard of the protest and ran a story in the paper about the naked rioting in Chestertown. Suddenly, wires were sent all over, and not only did this whole community learn of the incident, but it reached Chestertowners vacationing in Ireland and even the local Catholic priest who was in Hawaii at the time (If only I could think of some sort of witty quip to comment on this, but for once, I'm at a loss, as I'm sure the good Father was).

But, I hope with this new background to this day, my fellow WAC chums will realize this magical day is not just about seeing fellow students in a whole new light, but it's also a celebration of life, love, and seizing the day. So before you go out and strut you stuff, find a couple minutes, read "Gather Ye Rosebuds While Ye May" and appreciate its meaning then go rent "8 minute abs."

Bob Jensen's threads on higher education controversies are at

Beware of Employees Downloading ("Slurping") Confidential Data Into an iPod

Claire taught me about slurping on February 24, 2006

"Beware the 'pod slurping' employee," Will Sturgeon, C|Net News, February 15, 2006 ---

A U.S. security expert who devised an application that can fill an iPod with business-critical data in a matter of minutes is urging companies to address the very real threat of data theft.

Abe Usher, a 10-year veteran of the security industry, created an application that runs on an iPod and can search corporate networks for files likely to contain business-critical data. At a rate of about 100MB every couple minutes, it can scan and download the files onto the portable storage units in a process dubbed "pod slurping."

To the naked eye, somebody doing this would look like any other employee listening to their iPod at their desk. Alternatively, the person stealing data need not even have access to a keyboard but can simply plug into a USB port on any active machine.

Bob Jensen's threads on Phishing , Pharming, Slurping, and Spoofing are at

What's the "Rubber Room" in Detroit?
Hint:  It has nothing to do with tires.

"Detroit's Symbol of Dysfunction: Paying Employees Not to Work:  Cost Tops $1.4 Billion a Year As Layoffs Fill 'Jobs Bank'; A Dismal Facility in Flint Mr. Mellon Takes a Long Nap," by Jeffrey McCracken, The Wall Street Journal, March 1, 2006; Page A1 ---

In his 34 years working for General Motors Corp., one of Jerry Mellon's toughest assignments came this January. He spent a week in what workers call the "rubber room."

The room is a windowless old storage shed for engine parts. It is filled with long tables, Mr. Mellon says, and has space for about 400 employees. They must arrive at 6 a.m. each day and stay until 2:30 p.m., with 45 minutes off for lunch. A supervisor roams the aisles, signing people out when they want to use the bathroom.

Their job: to do nothing.

This is the "Jobs Bank," a two-decade-old program under which nearly 15,000 auto workers continue to get paid after their companies stop needing them. To earn wages and benefits that often top $100,000 a year, the workers must perform some company-approved activity. Many do volunteer jobs or go back to school. The rest must clock time in the rubber room or something like it.

It is called the rubber room, Mr. Mellon says, because "a few days in there makes you go crazy."

The Jobs Bank at GM and other U.S. auto companies including Ford Motor Co. is likely to cost around $1.4 billion to $2 billion this year. The programs, which are up for renewal next year when union contracts expire, have become a symbol of why Detroit struggles even as Japanese auto makers with big U.S. operations prosper.

While GM often blames "legacy costs" such as retiree health care and pensions for its troubles, its Job Bank shows that the company has inflicted some wounds on itself. Documents show that GM itself helped originate the Jobs Bank idea in 1984 and agreed to expand it in 1990, seeing it as a stopgap until times got better and workers could go back to the factories.

"The bank was designed for a different time, a time when we were growing," says Pete Pestillo, a former Ford executive who oversaw union talks. The Jobs Bank has failed to stop the outflow of jobs at Detroit's unionized auto makers. Since 1990, GM's union payroll including former subsidiary Delphi Corp. has fallen to about 137,000 from 358,000. Many have retired, died or found other jobs. The rest are in the Jobs Bank.

Mr. Mellon, a 55-year-old father of two, was born in Flint. He joined GM in 1972, following his grandfather and his father, a plant foreman who spent 37 years at GM. Through the 1980s and 1990s, Mr. Mellon held jobs designing electronic systems for vehicle prototypes. In 2000, GM merged two engineering divisions, and he wasn't needed anymore.

Since then, except for a period in 2001 when he worked on a military-truck project, GM has paid him his full salary for not working. That is currently $31 an hour, or about $64,500 a year, plus health care and other benefits.

Continued in article

German businesses are profiting from cost-cutting measures, an improved global outlook and better sentiment at home. But the fundamental problems remain the same as in Gerhard Schröder's seven years at the helm. Labor laws are too rigid, though firing rules were relaxed for the first two years of employment. Taxes rates are high and complicated, the bureaucracy onerous, the schools and universities subpar and health-care and pension costs exploding. For all the current optimism, Germany looks more like GM than Toyota or Porsche. In the next 100 days, if she is serious about fixing her country's deeper problems, Ms. Merkel will need to shift into higher gear.
"GMermany," The Wall Street Journal,  March 1, 2006 ---

"Reality Takes The 'Hit' From These Confessions," by Sebastian Mallaby, The Washington Post via The Wall Street Journal, March 1, 2006 ---

Last week I appeared on a radio show with an author named John Perkins. This man is a frothing conspiracy theorist, a vainglorious peddler of nonsense, and yet his book, "Confessions of an Economic Hit Man," is a runaway best seller.

The world, says Mr. Perkins, is governed by a shadowy "corporatocracy," an invisible empire of wealth and greed that deploys a combination of bribes, assassins and seductive women to enslave the poorest countries. Mr. Perkins served this empire as an "economic hit man," a consultant who bamboozled unsuspecting Asians and Latin Americans into borrowing too much, so puncturing their sovereignty. The loans financed lucrative contracts for American construction firms. Needless to say, Mr. Perkins is certain that they did not help poor people.

Even if you believe the stories of seducers and assassins, which other journalists have questioned, Mr. Perkins's basic contentions are flat wrong. Sure, developing countries (like rich countries) borrow too much sometimes. But the poor don't always lose. Nor are corporations all-powerful.

Mr. Perkins likes to invoke Indonesia, the scene of his first hit-man assignment. The way he tells it, the development economists who persuaded Indonesia to borrow money around 1970 were peddling a ludicrous idea -- that Indonesia's economy could spring from the dark age to the modern age in a mere generation. Well, Indonesia's infant mortality and adult illiteracy rates each fell by two-thirds over the next three decades, and life expectancy shot up by 19 years.

The same point holds for the developing world generally. The adult illiteracy rate in the poor world was halved between 1970 and 2000, and since 1980 the number of people living on less than $1 a day has fallen by about 200 million, even as the world's population has expanded rapidly. That is a stunning achievement given that the ranks of the poor had previously been swelling steadily, at least since 1820.

The poor have made these gains because Mr. Perkins's second contention is equally wrong: The corporatocracy is neither evil nor omnipotent. Survey after survey has shown that the multinational companies vilified by Mr. Perkins pay better wages than their local rivals in poor countries: One study of 20,000 Indonesian manufacturing plants found that the average pay in foreign-owned factories was 50% higher than in local ones -- and also that foreign competition pushed local wages upward. As Martin Wolf remarks in his book, "Why Globalization Works," multinational firms induce a race to the top more than a race to the bottom.

Mr. Perkins has tapped into a widespread fear. Thanks to the Bush administration, the mere mention of Halliburton is enough to prove the anticorporate case to many bookshop audiences. But the truth is that corporations do not rule the world, and intensifying global competition has rendered them more vulnerable.

"Ernst & Young fails to disclose high-profile data loss:  Sun CEO's social security number exposed," by Ashlee Vance, The Register, February 25, 2006 ---

Ernst and Young should go ahead and pony up for its own suite of transparency services. The accounting firm failed to disclose a high profile loss of customer data until being confronted by The Register.

Ernst and Young has lost a laptop containing data such as the social security numbers of its customers. One of the people affected by the data loss appears to be Sun Microsystems CEO Scott McNealy, who was notified that his social security number and personal information have been compromised. While pushing all out transparency for its customers, Ernst and Young failed to cop to the security breach until contacted by us.

"We deeply regret that a laptop containing confidential client information was stolen, in what appears to be a random act, from the locked car of one of our employees," said Ernst and Young spokesman Charles Perkins. "The security and confidentiality of our client information is of critical importance to us. The computer was password-protected, and we have no reason to believe the data itself was targeted or that the information was accessed by anyone. We are notifying those clients whose information was contained on the computer."

Ernst and Young declined to comment on whether or not McNealy was affected.

However, at lat week's RSA security conference, McNealy noted that he received an e-mail from an "anonymous partner" detailing a loss of his private data. "We determined that your name and social security number were among the data (lost)," the partner wrote to McNealy.

"This is an organization that we spend an enormous amount of money on to determine whether we are Sarbanes-Oxley compliant," McNealy said.

Continued in article

Bob Jensen's threads on E&Y are at

"Six Reasons to Kill Farm Subsidies and Trade Barriers:  A no-nonsense reform strategy," by  Daniel Griswold, Stephen Slivinski, and Christopher Preble, Reason Magazine, February 2006 ---

America’s agricultural policies have remained fundamentally unchanged for nearly three-quarters of a century. The U.S. government continues to subsidize the production of rice, milk, sugar, cotton, peanuts, tobacco, and other commodities, while restricting imports to maintain artificially high domestic prices. The competition and innovation that have changed the face of the planet have been effectively locked out of America’s farm economy by politicians who fear farm voters more than the dispersed consumers who subsidize them.

The time is ripe for unilaterally removing those distorting trade policies. In 2006 Congress will begin to write a new farm bill to replace the protectionist and subsidy-laden 2002 legislation that is set to expire in 2007. Meanwhile, the Bush administration will be negotiating with 147 other members of the World Trade Organization to conclude the Doha Round before the president’s trade promotion authority expires in mid-2007. Congress and the administration should seize the opportunity to do ourselves a big favor by eliminating farm subsidies and trade barriers, a change that would benefit all Americans in six important ways.

Continued in article

Remedial Math for the President
The administration's reductions in tax rates have been a success, so the first part of that claim is fine. After that, it goes downhill. President Bush's previous budgets increased spending by a dramatic 48.7 percent in six years. Defense spending increased by 67 percent while non-defense spending increased by 49 percent. It sometimes seems as if things are getting worse with each passing year. This year, total spending is increasing by 9.6 percent and has reached 20.8 percent as a percentage of GDP, up from 18.4 percent when President Clinton left office—that's a $909 billion increase in six years. The administration has been arguing that much of the increase in non-defense spending stemmed from higher homeland-security spending. However, the fact is that over half of all new spending in the past two years is from areas unrelated to defense and homeland security.
Véronique de Rugy, "Remedial Math for the President The only thing missing from the 2007 budget is fiscal responsibility," Reason Magazine, February 7, 2006 --- 

Scholar's Dictionary Of Aztec Language May Take a Lifetime
An American anthropologist has made it his life's work to create perhaps the most extensive archive of Nahuatl, the language spoken by Aztecs at the time of the Spanish conquest . . . Word by word, Mr. Amith is creating an extensive archive of Nahuatl, the language spoken by the Aztecs at the time of the 16th century Spanish conquest and now the first language of 1.5 million Mexican Indians. He records fables and personal histories, collects plants and insects, and keeps up a nonstop patter with locals, searching for information to add to a Web site he is building that is part dictionary, part encyclopedia and part storybook.
Bob Davis, "Scholar's Dictionary Of Aztec Language May Take a Lifetime: To Find the Words, Mr. Amith Collects Bugs, Folk Tales, Endures Village Rivalries," The Wall Street Journal, February 24, 2006; Page A1 --- 

A Girl in Science:  High school student finds new protein
A 16-year-old Glenelg, Md., high school student has received a patent for a protein that reportedly might help fight one of the world's deadliest diseases. Serena Fasano, a junior at Glenelg High School, told the Baltimore Sun the patent officially is owned by the University of Maryland, but she will be allowed to name it, although she's not allowed to call the protein Serena, or name it after any of her friends. Instead, it will need a scientific name indicating it is a probiotic -- a beneficial protein. A 16-year-old Glenelg, Md., high school student has received a patent for a protein that reportedly might help fight one of the world's deadliest diseases.
"High school student finds new protein," PhysOrg, February 22, 2006 ---

From the University of Illinois Scholarly Communication blog on February 21, 2006 ---

Globe Goes Digital
As the pace of modernization accelerates around the globe, so too has computer usage and access to the internet. The latest Pew Global Attitudes poll found substantially more people using a computer and going online now than in 2002. And it is not just the young who are increasing their use of technology; in many countries computer use has accelerated most rapidly among people over 50. In each of the 13 countries for which historical comparisons can be made, more people now use computers at home, school or work than in 2002. The rise is dramatic in Turkey, Russia, India and Poland, where the number of those who say they use a computer at least occasionally has risen by 13 percent to 16 percent in the three years between surveys. Great Britain has seen the largest increase in computer use, up 17 percent since 2002. More modest gains have been made in the U.S. and the rest of Western Europe, where majorities already reported using computers in 2002 although even in these countries the use of such technology has increased significantly. Internet use is also on the rise in both industrialized societies and developing countries, with the greatest increases among the British, Poles and French. However, there is a stark divide between those countries with high rates of internet use and those with less access to this technology. Read the full report at

Pew Research 2/21/06

February 23, 2006 message from Aaron Konstam



Crude Oil: $60

Coca Cola: $78.73

Milk: $126

Evian Water: $189.90

Orange Juice $251.16

Snapple Juice: $267.12

Perrier Water: $328.67

Lemon Oil: $390.88

Crisco Oil: $435.12

Scope Mouthwash: $826.65

Sunflower Oil: $971.04

Olive Oil: $1,324.38

Real maple Syrup: $1,787.52

Sesame Oil: $2,535.61

Jack Daniels Bourbon: $4,133.26  (Oh No!)

Tannin Oil: $4,290.05

Visine Eye Drops: $32,202.24 (and most of that is inert filler)

Flonase Prescription Nasal Spray: $238,133.21  (and most of that is inert filler)

Glenn Kroger replied:  Inkjet inks (based on typical HP 10 ml black cartridge) $178,000

Jensen Comment
And gasoline costing $2.39 at the pump comes to slightly over $100 for 42 gallons after being extracted from crude and shipped to the corner gas station. Of course oil companies also extract many other valuable commodities out of that $60 barrel of crude oil.

Turn Off File Sharing In Google Desktop
Tech research firm Gartner Inc. is recommending that enterprises turn off the file-sharing feature in Google Inc.'s desktop software. In a research posting on its site, Gartner said businesses allowing employees to use Google Desktop 3 Beta, which was released Feb. 9, should start using the enterprise version of the software immediately. In addition, it said businesses should disable the Search Across Computers feature.
Antone Gonsalves, "Gartner: Turn Off File Sharing In Google Desktop," InformationWeek, February 17, 2006 ---

"Fulfilling Technology's Broken Promise: A Perspective on Educational Technology,"
by Robert Bilyk, co-founder of lodeStar Learning Inc. and Cyber Village Academy, T.H.E. Journal, February 2006 ---

The Broken Promise of Technology
The one inarguable difference between now and then has been the promise that technology holds for the classroom teacher. In the early 1980s, I worked with stand-alone machines that could render stick figures on the screen and display text and numbers. The state of the art in audio was a few timely beeps. Nevertheless, I could envision the promise and began creating things that I could use in the classroom to help kids.

Over the course of time, more and more educators have turned to technology to help kids—but only to be disappointed time and again. Computers were expensive, they broke or became obsolete, they didn’t talk to one another, and they divided teachers’ allegiance through the great schism of Macs vs. PCs. Then there was the software that sat in shrink-wrapped packages unused. Integrated Learning Systems (ILS) were also expensive and inflexible. If a teacher didn’t like the pedagogy or content of a particular lesson, she could do little to change, add, or delete content. Teachers had to accept the bad with the good: ILS perpetuated the existence of the stick figure; computers threatened the existence of the teacher. At least, that was a common apprehension.

And despite the greater use of technology, studies such as the Trends in International Mathematics and Science Study from the National Center for Education Statistics have shown that our students still weren’t achieving well in math and science compared to their European and Asian counterparts. Fortunately, today’s educators are on the cusp of a tremendous realization: The promise that computers held for increased student achievement are finally being realized.

The New Promise of Technology
A teacher today who dares to imagine the possibilities that current technology affords won’t be disappointed: The total cost of ownership of a computer continues to decrease. Software is cheap and oftentimes free. Access to the Internet and all of the educational content that it holds is practically ubiquitous in American schools. Standards permit dissimilar computers to communicate with one another, and for educational content to be searched and shared. Therefore, technology needs to be met halfway. Lead teachers, mentor teachers, curriculum directors and administrators—teachers in general—must dare to dream again. Schools must place networked computers in classrooms, libraries, lobbies, and wherever else they can be safely accessed. Accessibility to computers is essential. Teachers need to be trained—not once but often. Professional development is also essential because teachers need to support each another. Ideally, teachers from common disciplines would network with one another. The use of instructional technology by teachers to improve student achievement must become habitual. And finally, all roads must lead to the teacher. That is, all student performance data must flow effortlessly to the teacher.

To fulfill the promise, computer use by teachers must become habitual, and computer use to improve student achievement must become habitual. The advent of learning management systems like Microsoft Class Server, Blackboard and Desire2Learn has enabled teachers to manage the student online learning experience. Often, school districts direct this usage to the exception—offering activities to children who are ill, replacing snow days with online days, and providing a class to a home-schooled child.

The snow day example was my favorite. The online snow day was designed by well-intentioned educators, but it had its flaws. In this example, the school trained its entire staff on an LMS so that one day, when it snowed, students could access their courses online. On the day it snowed, the untested system failed; staff were out of practice in creating, assigning, and grading; and students could hardly remember how to log on. This example might seem a little extraordinary, yet variations on this same theme are commonplace. Rather than integrating online curriculum into the example, schools flirt with technology at the edges, addressing the “unusual situation” so that the business of integrating the class with technology does not become “habitual” and second nature for teachers.

Continued in article

February 24, 2006 reply from Robert Holmes Glendale College [rcholmes@GLENDALE.CC.CA.US]

I have spent time in these classes reflecting on the role of the teacher. (I am mostly retired and teach one accounting class online.) The most effective classes are those that invlove two way communication with the students. Technology and lectures are poor substitutes for this dialogue. The electricity that sparks in the classes as the students offer ideas, the instructor says give me more, other students say "I never thought about that" is something to behold. I feel sorry for those (including my students) who have to try to get an education without this kind of enriching excitement.

Bob Jensen's threads on the promises education technology and its dark side are at

How to be a gentleman (but not always politically correct with feminists) ---
A Practical Guide to the 19th Century American Male ---

A Teacher's Guide to the Holocaust ---

Holocaust Memorial Museum ---

Not Politically Correct:  Media Outlets Ignore Saddam's Uranium Bombshell
Tape recordings released over the weekend show that Saddam Hussein had an active nuclear weapons program at least as recently as 2000 - but the press has decided the bombshell development isn't newsworthy. Speaking at the Intelligence Group Summit in Arlington, Va., Saddam tapes translator Bill Tierney revealed that in one recorded conversation, the Iraqi dictator can be heard discussing a plan to enrich uranium using a technique known as plasma separation. Though U.S. weapons inspectors found that 1.8 tons of Saddam's 500 ton uranium stockpile had been partially enriched, they failed to turn up any evidence of an ongoing enrichment program.
Carl Limbacher, "Media Ignore Saddam's Uranium Bombshell," NewsMax, February 20, 2006 ---

Graduation Rates Unacceptably Low
More than a third of high school students in the state scheduled to graduate last June failed to do so, State Education Commissioner Richard P. Mills said yesterday, calling the figure "unacceptable." Among boys, the numbers were even worse, Mr. Mills said, calling them "particularly disturbing." Statewide, 59.4 percent of boys graduated on time in 2005, compared with 69.2 percent of girls. In New York City, the gap was more pronounced, with 37.3 percent of boys and 49.8 percent of girls graduating on time last year.
Elissa Gootman, "High School Graduation Rates Unacceptably Low, State Says," The New York Times, February 14, 2006 ---

Are young women really drinking more alcohol?
Therefore, we were disappointed to see that you based your page-one article "Mixed Company: As Young Women Drink More, Alcohol Sales, Concerns Rise" (Feb. 15) on a Datamonitor study that purports to show an increase of 33% in consumption of alcoholic drinks by volume among young women aged 21 to 24. That would be big news in an industry that measures market share progress in 1% upticks and downticks over the years.The Datamonitor study inexplicably measured "liquid" volume, not "alcohol" volume, an invented statistic used, to the best of our knowledge, by neither government nor industry in the U.S. Put simply, under the Datamonitor scenario, if an ounce of alcohol was added to five ounces of orange juice, they counted this as six ounces of alcohol, a false and completely meaningless measure of alcohol consumption. There is no 33% alcohol volume increase in the U.S.; in fact, drinking by women aged 18 to 25 has been flat in recent years, according to the National Survey on Drug Use and Health. And, of course, drinking by young adults aged 18 to 21 years is illegal.
Francine I. Katz, "Young Women Are Not Drinking More," The Wall Street Journal, February 24, 2006; Page A13 ---

Can Sony make the iPod of electronic books?
See "Curling Up With a Good eBook," Business Week, December 29, 2005 ---

The Renewed Upward Trend in Portable Electronic Books
Richard D. Warren, a 58-year-old lawyer in California, is halfway through Ken Follett's novel Jackdaws. But he doesn't bother carrying around the book itself. Instead, he has a digital version of Follett he reads on his Palm Treo each morning as he commutes by train to San Francisco from his home in Berkeley. He's a big fan of such digital books. Usually, there are around seven titles on his Treo, and he buys at least two new ones each month. "It's just so versatile," he says. "I've tried to convert some friends to this, but they think it's kind of geeky." Geeky? For now, maybe, but not for much longer. Many experts are convinced that digital books, after plenty of false starts, are finally ready for takeoff. "Every other form of media has gone digital -- music, newspapers, movies," says Joni Evans, a top literary agent who just left the William Morris Agency to start her own company that will focus on books and technology. "We're the only industry that hasn't lived up to the pace of technology. A revolution is around the corner."
"Digital Books:  Start A New Chapter Lighter devices, better displays, and the iPod craze could make them best-sellers," Business Week, February 27, 2006 --- Click Here 

There are some points to take into consideration about "free textbooks" such as the ones that I list at

1. Many of these "free" books are books that have been dropped by publishing firms or were never accepted by publishing firms in the first place. If they were dropped, they have met a rigorous reviewing process and may have made money for the authors. In fact they might have been dropped simply due to the all-to-frequent process of publishing company mergers that left publisher oligopolists with too many textbooks on a given topic.

2. Whereas the end consumer makes many choices about whether to use a product with advertising (e.g., magazine subscriptions, newspaper purchases, Google searches, etc.), the choice of a textbook is usually in the hands of instructors rather than end user students. In general, students are ceteris paribus grateful for free textbooks even if they must endure a certain amount of advertising. It's the "ceteris paribus" part that's a problem. Those new textbooks costing students $90 or more (without advertising) provide incentives for authors to make careful revised editions. Also publishing firms have the revenues to provide improved supplements (most of which really need improving in the accounting textbook market sector). As of yet free textbooks, with or without advertising, provide little monetary incentive to authors or free-book publishing firms to constantly improve the product.

3. Free textbooks are not available in hard copy. Some electronic publishers offer hard copy versions, usually at prices cheaper than photocopying entire books would cost. Many of us, and I mean me especially, prefer a hard copy version to read and an electronic version to search. Good electronic versions also provide convenient hypertext links and possibly even some multimedia. Although Cybertext does not offer free textbooks, I like the Cybertext option to also buy a hardcopy version. And I like the hot links in the electronic versions and the option to take quizzes online with results being graded and sent to instructors ---
Publishers of free textbooks are never likely to offer such services unless advertising revenues become very successful. I don't think any of them are at that point yet.

 4. We should all be grateful that free textbooks exist even if we do not ourselves adopt them for our courses. In this age of price gouging by publisher oligopolies, the free textbook alternatives may be about the only serious competition that publishers face, especially when, not if, textbook publishers finally invent a way to eliminate the used textbook market in their own books.

February 14, 2006 message from a distributor of free textbooks (that do have advertising)

To date our free textbooks have been made possible by a combination of angel investor money and by the principals in the company, who have invested both their time and money. We have some advertisers (download a book and you'll see) and seek more. We are actively pursuing sponsorships. More investment has been promised. Authors receive a percentage of our revenues -- "net receipts"-- per book. They sign on because of their confidence in our business model and in us.

We sell the paperback copies pretty much at cost. Regardless, those monies are very limited, inasmuch as only about 5 percent of students, thus far, end up buying the print book.

What propels our business is the widespread perception that text prices are unreasonable. We are addressing this situation in an innovative way. Moreover, we do not skimp on instructor support; all our titles come with ancillaries available to adopters.

In this case, "free" really does mean free. This is not the proper forum, but I can provide testimonials and contact information for many people who already have benefited from this service.

Best wishes to all concerned!

Edgar Laube
Freeload Press
3316 Tally Ho Lane
Madison, WI 53705 608.233-1112

Latest Trend in Textbooks: Textbooks With Advertising are Free Online

From the University of Illinois Issues in Scholarly Communication Blog, February 7, 2006 ---

Publisher Launches Ad-Supported Online Text HarperCollins has announced a new program that will make book content available free online, supported by advertiser links that share the page with the text. Officials from the publisher said the Harper program will focus on nonfiction and reference books, noting that advertisers are likely not as interested in paying to support literary fiction. The first book offered in the program, "Go It Alone! The Secret to Building a Successful Business on Your Own" by Bruce Judson, was published in 2004 and later released in paperback. One test of the program will be whether ad sales offset lost sales, according to Murray, group president of HarperCollins. Despite the ongoing squabbles over online access to books, supporters of the idea still believe it has potential. Author M.J. Rose said that no one wants to read an entire book online but that if they have easy access to a text on the Web and they like it, they will be encouraged to buy a copy. Associated Press, 6 February 2006 Edupage, February 06, 2006 

For examples of free textbooks see

Bob Jensen's threads on the fits and starts of portable electronic books are at

Bob Jensen's threads on electronic literature (mostly downloaded to PCs and Macs) are at

From the Wharton School blog at the University of Pennsylvania: Where's Adobe Headed?
With its acquisition of Macromedia on December 3, 2005, Adobe Systems has become the fifth largest software company in the world. It currently controls two of the dominant formats for electronic content -- the Adobe Acrobat PDF format for electronic documents and the Flash SWF format for interactive web content. Looking ahead, CEO Bruce Chizen's goal is to have Adobe provide the interface for any device with a screen -- "from a refrigerator to an automobile to a video game to a computer to a mobile phone." Such ambitions put Adobe squarely in the sites of Microsoft, which currently dominates desktop software development. In a recent interview with Knowledge@Wharton, Chizen spoke about the Macromedia acquisition, his plans for developing the next-generation application platform and his views on the challenges presented by Microsoft.
"After Acquiring Macromedia, What's Next for Adobe? Ask Bruce Chizen," Knowledge@Wharton, February 2006 ---

There's just no limit on what Bush will agree to spend
America's largest companies expect the federal government to pay them about $4 billion over the next four years to help keep their retiree health plans alive at a time when such benefits are increasingly on the chopping block, according to a new study by Credit Suisse First Boston. The money is due to start flowing to employers this month as part of Medicare's new prescription drug benefit. When Congress authorized the Medicare drug benefit, it also agreed to start subsidizing the drug component of employers' retiree health plans, to keep them from shifting their retirees into the government program.
Mary Williams Walsh, "U.S. to Pay Big Employers Billions Not to End Their Retiree Health Plans," The New York Times, February 24, 2006 ---

From Wharton (with audio): A Million Little Embellishments: Truth and Trust in Advertising and Publishing
The disclosure that author James Frey lied in his best-selling book, A Million Little Pieces, and the furor that followed raise numerous questions about truth in advertising, trust between sellers and buyers, brand image and reputation, as well as two themes that Frey himself focused on in his now-discredited memoir of recovery from substance abuse -- suffering and redemption. How widespread is deception, when is stretching the truth acceptable, how jaded are consumers towards the claims made by advertisers, and how credible was Oprah's response to the Frey incident? Wharton experts offer their views on truth and fiction.
"A Million Little Embellishments: Truth and Trust in Advertising and Publishing " Wharton School of Business, University of Pennsylvania, Knowledge@Wharton , February 20, 2006 ---

Television host Oprah Winfrey did a commendable job redeeming herself and repairing her damaged personal brand by apologizing to her audience for continuing to endorse the book after it was learned that it contained fabrications, according to Wharton faculty members who specialize in marketing, trust and ethics. Although Frey suffered when Winfrey used her TV show to scold him for embarrassing her by writing a book laden with falsehoods, he came off ill-prepared and less than forthcoming. He has tried to salvage his reputation by offering a written explanation for his actions, which his publisher is now distributing with new copies of his book. In the author's note Frey acknowledges that he "embellished many details about my past experiences" and that he wanted to create "the tension that all great stories require." But Frey's statement may be too little, too late. It remains uncertain whether he has fully redeemed himself and whether many readers will buy future non-fiction books written by him, the Wharton experts say.

Frey's publisher, Doubleday, and Winfrey are not entirely out of the woods yet, either. Each must take additional steps if they wish to restore entirely the trust that existed between them and readers before "The Smoking Gun" website posted an article on January 8 that debunked many of the statements made in Frey's book. Several Wharton faculty members suggest that Oprah, Doubleday and other publishers wishing to avoid Doubleday's fate establish fact-checking procedures or take other measures to ensure that claims made by memoirists are valid prior to marketing or endorsing such books in the future.

Maurice E. Schweitzer, professor of operations and information management, says there is simply no question that writers of memoirs must stick to the facts because that is what readers expect. To do otherwise risks an erosion of trust between buyers and sellers similar to what happened after the reporting scandals at the New York Times (Jayson Blair in 2003) and the Washington Post (Janet Cooke in 1980) as well as any number of similar controversies over the last 30 years. These include article fabrications in the 1990s by Stephen Glass, a writer for The New Republic magazine; Alex Haley's admission that he fictionalized parts of his 1970s bestseller Roots; a phony biography of billionaire recluse Howard Hughes by Clifford Irving in the 1970s that landed Irving in jail; controversy over "historical" films by director Oliver Stone; and the recent disclosure that Hwang Woo-suk, a Korean scientist, had completely fabricated data in a research paper on stem cells.

"People want to read The New York Times because they want to get an accurate representation of what's going on around them," says Schweitzer, who has written about trust and unethical behavior. "People want to read memoirs because they seek guidance about what an individual can or can't do, and they want to be inspired by that. There are clear benefits if something is true."

In Schweitzer's view, Winfrey made two mistakes. First, she endorsed A Million Little Pieces to members of Oprah's Book Club in 2005 without checking its veracity. She later made a bigger error in defending her choice of the book in a telephone call to "Larry King Live" following "The Smoking Gun" revelations. Winfrey told King that the controversy was "much ado about nothing" because "the underlying message of redemption in James Frey's memoir still resonates with me, and I know it resonates with millions of other people who have read this book."

But Schweitzer says Winfrey made a "fantastic" recovery from these missteps on a subsequent program, aired January 26, 2006, on which Frey and his publisher, Nan A. Talese, appeared. Winfrey apologized to viewers and posed hard-hitting questions to Frey and Talese about the whole affair. Frey admitted to extensive fabrications.

"If you could write a script for trying to recover from those mistakes, she followed it," says Schweitzer. Frey, however, "gets no marks for being forthcoming. At no point in this process did he initiate an apology. It seemed the very point at which he recanted he was prompted by somebody else. He didn't take the initiative in promoting the truth. He comes off looking like a very untrustworthy person. I don't see how he can recover from that."

According to marketing professor Barbara Kahn, the controversy represented a "branding crisis" for Winfrey. Winfrey "violated the trust with her audience by saying the truth didn't matter when she called the Larry King show. It was a violation of a contract she had with her audience. If you think of the brand 'Oprah,' the reason people put trust in it is she has the resources to ensure something is true. That was violated."

Kahn adds that Winfrey had more to lose than Frey as a result of the controversy, in part because he had already reaped a fortune from the book's sales of some two million copies. Says Kahn: "She is a brand name. She made a guarantee [by initially endorsing the book] and her reputation was more at stake. The cost was greater to her than to him."

The Right Way to Frame the Issue

Katherine A. Nelson, a Philadelphia-area ethics consultant who teaches in Wharton Executive Education programs, believes that Winfrey was not at fault for taking an author's word about the truth of his book because the publisher ostensibly had already done so. However, after doubts had been raised, Winfrey "should not have called Larry King without doing some fact-checking of her own. But once she learned more about Frey and the 'facts' of the book, she did the right thing and made lemonade out of the lemons she was handed by Frey. And she was right to give him a few lemons of her own when she confronted him on her show."

Wharton ethics professor Thomas W. Dunfee says Winfrey's mistake in phoning Larry King was similar to errors made by managers in many businesses: She did not see an ethical problem because she did not "frame" the issue in the right way. As a result, she missed seeing the larger issue and its risks.

Continued in article

From Wharton (with audio): Carl Icahn's Take on Time Warner and Corporate America
Carl Icahn's battle for Time Warner has just intensified. Icahn, the corporate takeover specialist attempting to win control of the media giant, held a press conference yesterday to announce a plan to break Time Warner into four separate companies and buy back $20 billion in stock -- all part of his crusade to oust management for the benefit of shareholders. His press conference followed a speech last week at the 2006 Wharton Economic Summit in which he denied that he is an "imperial shareholder" out to rip companies apart for quick gains. Icahn was responding to remarks made earlier at the Summit by corporate lawyer Martin Lipton, who argued that a new breed of aggressive shareholder is pressuring companies to produce short-term gains at the expense of long-term growth.
"'If He Ruled the World': Carl Icahn's Take on Time Warner and Corporate America," Wharton School of Business, University of Pennsylvania, Knowledge@Wharton , February 20, 2006 ---

Google's Brilliant Philanthropist
Founders Larry Page and Sergey Brin have tapped Dr. Larry Brilliant to spend up to $1.1 billion of the outfit's money on what ails the world
Business Week, February 22, 2006 --- Click Here

"Brilliant's Wish: Disease Alert," by Kim Zetter, Wired News, February 22, 2006 ---,70280-0.html?tw=wn_index_5

From NPR: Hedge Fund HedgeHogging (with audio)
The hedge fund industry is one of the fastest growing corners of the investment world. Now Wall Street insider Barton Biggs has exposed the industry's cast of characters to scrutiny in the book HedgeHogging.
Jim Zaroli, "Barton Biggs Shines a Light on Hedge Funds," NPR, February 20, 2006 --- 

Bob Jensen's threads on hedge funds are under the H-terms at

How far will your broker go to protect you against ID theft and fraud?

"Charles Schwab To Cover All Fraud Losses," by Greg Keizer, InformationWeek, February 23, 2006 ---

Online broker Charles Schwab Wednesday issued a guarantee against any and all losses from unauthorized account access, the latest online trader to calm customers' jitters about phishing scams and identity theft.

As of Wednesday, all Schwab customers are 100 percent covered against loss, the San Francisco-based company said. They need take no action unless they suspect that their account has been accessed without their permission or knowledge, Schwab added.

"It has always been our practice to make clients whole in cases of unauthorized account activity. Our new security guarantee turns that historic practice into a public promise," said chief executive Charles Schwab in a statement. "Given rising public concerns over identity theft and cyber-fraud, we think adding a clear and simple guarantee will contribute to even greater peace of mind for our clients."

Schwab follows rivals in posting a guarantee; in January, New York-based ETrade launched what it called "Complete Protection Guarantee" to cover all losses originating from fraud.

Banks, online brokers, and other financial institutions have been worried of late about fraud in general and identity theft in particular, as online users have turned skittish in reaction to a rise in e-fraud. Several polls taken in 2005, for example, noted that U.S. consumers were becoming less likely to conduct financial transactions over the Internet.

Even the Securities and Exchange Commission (SEC) has expressed concern about the trend. In September, it issued a guide on the dangers that identity thieves posed to online brokerage accounts.

Bob Jensen's threads on ID theft are at

Historical Census Browser ---

U.S. Census Bureau ---

From the U.S. Census Bureau ---

Bob Jensen's bookmarks for economic statistics are at

Stalin's Executioner
From then on, neither the U.S.S.R. and its satellites nor the world communist movement were ever the same. Mao and other unrepentant Stalinists saw Khrushchev as an arch-revisionist and a renegade, the gravedigger of communism, though it took another few decades for it to die. In his speech, Khrushchev denounced Stalin's "cult of personality," which was a euphemism for the horrors inflicted on his country and region during the three decades that the Georgian stayed in power. His audience was dumbfounded. Many felt liberated, others betrayed and offended. The four-hour discourse documented Stalin's "grave abuse of power," his murderous persecution of the party elite, his leading role in the Great Terror, the ferocious treatment of major party personalities, and his failures as a military commander. Khrushchev declared the worshipped leader, in life and in death, guilty of the destruction of so many human lives, the brutal deportations of whole ethnic groups, the absurd agricultural schemes that starved millions in Ukraine and other rural regions to death, and his "loathsome adulation" masquerading as "party history."
Validimir Tismaneanu, "Stalin's Executioner," The Wall Street Journal, February 24, 2006 ---

International Accounting Database Statistics
We have updated our Database of Statistics that, we believe, provide clear evidence of the globalisation of the world's capital markets and of the need for global financial reporting standards. Updates include latest data about cross-border listings on the World Federation of Exchange member exchanges, London, NYSE, and NASDAQ, and some data on cross-border lending.
IASPlus, February 20, 2006 ---  

From the University of Illinois Issues in Scholarly Communication Blog, February 15, 2006 ---

Piracy Losses Put at $606 Million
As part of its annual report to the U.S. Trade Representative, the International Intellectual Property Alliance estimated that illegal copying of books abroad cost the book industry about $606 million in 2005, roughly the same level as 2004. Losses for all copyrighted intellectual property to piracy topped $15.8 billion last year, the IIPA estimated. AAP president Pat Schroeder said that while progress has been made in fighting book piracy abroad, more work needs to be done. Asia continues to be a piracy hot spot, even though enforcement has improved in such places as Hong Kong and Taiwan, Schroeder said. "Even where enforcement is at least partially effective," Schroeder noted, "court delays remain, especially in countries such as India and the Philippines.Legal developments in Hong Kong, Thailand, South Korea and elsewhere continue to deny effective protection to book publishers, and enforcement mechanisms so effective for other industries in countries such as Pakistan have not yet been employed against book pirates." Schroeder further observed that market access barriers continue to make it difficult for publishers "to make genuine product available in relevant markets such as China." PW 2/14/06 

China's Accounting Standards in Line with IFRS
In our news story of 16 February 2006, we reported that the Ministry of Finance (MOF) of the People's Republic of China has announced that it has adopted a new basic standard and 38 new Chinese Accounting Standards that are substantially in line with IFRSs. MOF has also adopted new auditing standards that are substantially in line with International Standards on Auditing (ISAs). The MOF has issued a Press Release (PDF 17k) elaborating on the new accounting and auditing standards. In December 2005, the Chinese Auditing Standards Board (CASB) and the International Auditing and Assurance Standards Board (IAASB) had released a joint statement in which the CASB states that the fundamental principle of drafting Chinese auditing standards is to improve the Chinese auditing standards system and to accelerate its convergence with the IAASB's ISAs. Click for China-IAASB Joint Statement (PDF 988k)), which we had reported in our news story of 23 December 2005.
IASPlus, February 20, 2006 --- 

"Waterworld: how life on Earth will look 1,000 years from now," by Nigel Hawkes, The London Times, February 7, 2006 ---,,3-2044465,00.html

By the year 3000, the report says:

Global warming could have more than quadrupled, with temperature rises of as much as 15C, if we continue burning fossil fuels

Sea levels will still be rising at the end of this millennium and the total increase could reach 11.4 metres. This dwarfs estimates made by the Intergovernmental Panel on Climate Change that sea levels will rise by between 16cm and 69cm by the 2080s

Anything more than a two-metre rise would flood large areas of Bangladesh, Florida and many low-lying cities, and displace hundreds of millions of people

Abrupt climate changes are possible even after emissions cease because changes may be set in motion that cannot be stopped

The acidity of the oceans will fall significantly, posing a threat to marine organisms such as corals and plankton. That, in turn, would affect the whole marine ecosystem

The changes could be even greater than this if the climate turns out to be more sensitive to greenhouse gas emissions than the study assumes

Continued in article

Terrorists Increasingly Turn to the Internet:
The Internet is increasingly being exploited by terrorist groups, who are using the medium to multiply the effectiveness of their planning, recruitment, and propaganda, says an Israeli researcher. For instance, such groups have become sophisticated enough to build sites "narrowcasted" to women and children. Dr. Gabriel Weimann, professor of communication at the University of Haifa, Israel, has done empirical research into the evolving nature of terrorist use of the medium, which he describes in a forthcoming book, Terror on the Internet: The New Arena, the New Challenges. And some of his findings may surprise Americans.
David Talbot, "Terrorists Increasingly Turn to the Internet: Terrorist groups are using the Internet with more success, according to studies by an Israeli researcher," InternetWeek, February 21, 2006 ---,258,p1.html

February 20, 2006 message from Linda Kidwell, University of Wyoming [lkidwell@UWYO.EDU]

In my endless pursuit of interesting audit reports to use with my classes, I came across a treasure trove last week. Credit Acceptance Corporation has had an interesting set of reports in the recent weeks. If you look them up in Edgar, here's some of what you'll find:

1) an 8-K dismissing Deloitte over accounting disagreements an internal control report with a material weakness
2) unqualified opinions on the financials from Grant Thornton with an explanatory paragraph over restatements resulting from the DT dispute
3) a change in GAAP application insisted upon by DT, after consultation with the SEC, despite DT having issued an unqualified opinion in the past on that prior treatment
4) a disclaimer by GT on the internal control report over a scope limitation

It is a fun case for use with audit classes as they try to piece together this puzzle.

Bob Jensen's threads on the saga of auditor professionalism and independence are at

Why not actor George Clooney for the next President of the United States?

"The Clooney left:  If only George Clooney would run for president. John Patterson sizes up the star's political prospects," The Guardian, February 25, 2006 ---,,1717051,00.html 

Clooney has one divorce in his background, but no scandal beyond clipping David O Russell round the ear on the set of Three Kings, which is the kind of thing that plays well in the Red states - much like shooting lawyers in the face. His youthful indiscretions pale against the current incumbent's binge-drinking, DUI convictions, perpetual bailings-out, not to mention draft-dodging. Clooney might merely be expected to apologise for Revenge Of The Killer Tomatoes and for his never-released debut movie, co-starring the louchely Kennedyesque Charlie Sheen. He'd be the first single president, well, since Michael Douglas in The American President, which would make him a bit like the skirt-hound Kennedy, though Clooney appears not to be the almost neurotic priapist JFK was. One of Kennedy's more famous conquests was Angie Dickinson ("the most unforgettable 60 seconds of my life," was her post-coital verdict), better known as the original Mrs Danny Ocean, so there's a whiff of that retro-Camelot glamour for you right there. Like Reagan, Kennedy and Clinton, he'd probably be a grating presence to a good half of the American electorate, but it didn't kill them and it wouldn't kill him.

Politically, a Clooney presidency would probably strive to return sanity to the national debate. The American right has long smeared Clooney as just another loopy Hollywood liberal, but there's no evidence that he's anything but an old-fashioned American centrist. His political movies, particularly this Friday's Syriana and Good Night, And Good Luck, are hardly radical agitprop. They (and Three Kings and Clooney's TV remake of Fail Safe) may have the slightly worthy air of civics lessons, but they certainly suggest the guy is engaged with his times. A good-looking, independently minded, lapsed-Catholic, clean-and-sober actor versus a bought-and-paid-for, dry-drunk fundamentalist and four-decade failure of a human glove-puppet?

Voters, the choice is clear!

Jensen Comment
Clooney is not asking for an endorsement from Michael Moore. Below is a tidbit from the February 13 edition of Tidbits.

Clooney is quite sniffy about Moore, whose modus operandi he finds obnoxious and counter-productive. He uses his name as a verb - "I don't Michael Moore this shit," he says. "I don't come out and go, 'Look what these fuckers do.'" He thinks subtlety - class - gets better results. He is no doubt right, but it seems a little unfair given that dissent is a lot more palatable when it comes in the shape of George Clooney. His response to the traitor incident was to put together a montage of prominent people on the anti-war side, including the pope, Jimmy Carter, Nelson Mandela and Pat Buchanan (a hard-right commentator in the US) and drape the word "traitors" across them, too. "Then I made 800 fliers anonymously and sent them to everyone in the media. And I waited. And Dan Rather [CBS news anchor] called me and said, have you seen this flier that's going around? And I said, 'My quote would be, the Pope and I can take it, but don't pick on Pat Buchanan.'" He grins. "You know, the truth is . . . it is not merely your right but your duty to question your government. You can't demand freedom of speech and then say, but don't say bad things about me. You gotta be a grown-up and take your hits."
"'I've learned how to fight' ," The Guardian, February 10, 2006 ---,,1706303,00.html

Presidents Day quiz Click Here

What's in a name?

1. Who is the first president alphabetically, by last name?

2. Who is the last president alphabetically, by last name?

3. Which last names are shared by two presidents?

4. What's the most common first name among U.S. presidents?

Who was president ...

5. ... when the Civil War began?

6. ... when we received the Statue of Liberty?

7. ... during World War I?

8. ... when World War II ended?

9. ... when the last two states joined the union?

10. ..when Neil Armstrong set foot on the moon?

Historically speaking

11. Who was the only president to serve two nonconsecutive terms?

12. Who was the only president never elected president or vice president?

13. Who was the first president to appoint a female to his Cabinet?

14. What's the president's annual salary?

Honors (and dishonors)

15. Whose faces appear on Mount Rushmore?

16. Which president is on the highest-denomination bill of U.S. currency in public circulation?

17. Which president is on the highest-denomination U.S. coin in circulation?

18. Which three presidents have received a Nobel Peace Prize?

19. Which president wrote a Pulitzer Prize-winning book before taking office?

20. Name two presidents who were impeached by the House of Representatives?

Personally speaking

21. Who was the youngest president?

22. Who was the oldest president?

23. Who was the tallest president?

24. Who was the shortest president?

25. Which president had the most children?

26. Which president(s) had the fewest children?

27. How many bachelors were elected president?

28. Which presidents were assassinated in office?

29. How many others died in office?

30. Which president and first lady were both lawyers?



1. John Adams.

2. Woodrow Wilson.

3. John Adams and John Quincy Adams, William Henry Harrison and Benjamin Harrison, Andrew Johnson and Lyndon Johnson, Teddy Roosevelt and Franklin D. Roosevelt, and George H.W. Bush and George W. Bush (1 point for each correct answer; maximum 5 points).

4. There have been six named James: Madison, Monroe, Polk, Buchanan, Garfield and Carter. Tied for second are John (Adams, Quincy Adams, Tyler and Kennedy) and William (Henry Harrison, McKinley, Taft and Clinton).

5. Abraham Lincoln in 1861.

6. Grover Cleveland in 1886.

7. Woodrow Wilson was president during the 1914-1918 conflict.

8. Harry Truman in 1945.

9. Dwight D. Eisenhower in 1959.

10. Richard Nixon in 1969.

11. Cleveland was president from 1885-1889 and 1893-1897.

12. Ford was appointed vice president after Spiro Agnew resigned in 1973, and became president in 1974 when Richard Nixon resigned.

13. FDR named Frances Perkins secretary of labor in 1933.

14. $400,000.

15. Abraham Lincoln, Thomas Jefferson, Teddy Roosevelt and George Washington (1 point for each correct answer; maximum 4 points).

16. Ulysses S. Grant on the $50 bill.

17. John F. Kennedy on the half-dollar.

18. Teddy Roosevelt in 1906, Woodrow Wilson in 1919 and Jimmy Carter in 2002 (John Hancock, of course, was never president).

19. John F. Kennedy penned "Profiles in Courage."

20. Andrew Johnson in 1867 and Bill Clinton in 1998. (Both men subsequently faced trials in the Senate and were found not guilty of the charges against them.)

21. Teddy Roosevelt was 42 when he assumed office after McKinley's assassination in 1901. (John F. Kennedy was the youngest elected president at 43.)

22. Ronald Reagan was 77 when he left office.

23. 6-foot-4 Abraham Lincoln.

24. 5-foot-4 James Madison.

25. John Tyler had 15 children.

26. James Buchanan was a lifelong bachelor, James K. Polk was married but had no children, and Warren G. Harding had no children with his wife but was rumored to have several illegitimate children. (1 point for each correct answer; maximum 3 points.)

27. Buchanan never married, and Grover Cleveland was married in the White House. (1 point for each correct answer; maximum 2 points.)

28. Abraham Lincoln in 1865, James Garfield in 1881, William McKinley in 1901 and John F. Kennedy in 1963. (1 point for each correct answer; maximum 4 points)

29. William Henry Harrison in 1841, Zachary Taylor in 1850, Warren G. Harding in 1923 and Franklin D. Roosevelt in 1945. (1 point for each correct answer; maximum 4 points.)

30. Bill and Hillary Rodham Clinton

Your score:

36 or more: A True Patriot. Congratulations! You're either a history teacher or could be one.

26-35: A Civic Salute. You know more than most people do about the men who have occupied the Oval Office.

16-25: Bipartisan Support. Regardless of your political leanings, you demonstrate knowledge about both sides of the aisle.

6-15: Historically Hit-or-Miss. You know a thing or two about our commanders in chief, but there's plenty of room to bridge the gaps in your knowledge.

Fewer than 6: A presidential pardon? Your forehead is probably bruised because you smacked it so often going over the answers.

Sources: "The Essential Book of Presidential Trivia" by Noah McCullough; "A Call to America" by Bryan Curtis; The Franklin Institute Online

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Professor Robert E. Jensen (Bob)
Jesse H. Jones Distinguished Professor of Business Administration
Trinity University, San Antonio, TX 78212-7200
Voice: 210-999-7347 Fax: 210-999-8134  Email:  


Tidbits on March 6, 2006
Bob Jensen
at Trinity University 

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In the past I've provided links to various types of music and video available free on the Web. 
I created a page that summarizes those various links ---

Videos from Suicide Bombers
Suicide bomber videos: Footage of hate Farewell message: 'There is no blood better than the blood of Jews'

WorldNet Daily, March 2, 2006 ---

Quail Hunting School (forwarded by Paula) ---

"Searching the Web for Video Clips" by Walt Mossberg and Katherine Boehret ---

From Opinion Journal on February 28, 2006
In an item yesterday on "Tom and Jerry," we mentioned "The Ducktators," a 1942 Looney Tunes short depicting an anatine Hitler and an anserine Mussolini. It turns out a video (albeit of rather poor quality) is available through Google; click here  

The Blogging Heads ---

Information Week news (in audio) and Windows Vista security (in video) ---

Exploring Space: The Quest for Life (from PBS) ---

Remember This One? (turn your speakers up)
Do Your Own Damn Taxes Video (music from Frank Sinatra) --- 

Free music downloads --- ---

In the past I've provided links to various types of music and video available free on the Web. 
I created a page that summarizes those various links ---

My Time on Earth ---

From NPR
Jenny Lewis: Questioning God on 'Rabbit Fur Coat' ---

God Bless America Again ---

From NPR
Singing of New Orleans, Past and Future ---

Mississippi Squirrel Revival ---


Photographs and Art

From NPR
The Decline of the Black Farmer ---

Girodet: Romantic Rebel ---

From NPR
Culture Destroyed by 1815 Volcano Rediscovered ---

Dali Painting Galleries ---

Earnest Lee Major (1864-1950) Paintings ---

History of the Ossuary in Kutna Hora - Sedlec ---

Van Gogh's Letters ---
Van Gogh Gallery ---
Also see

Dennis Weaver Photographs ---
Also see, Dennis&hl=en
Dennis Weaver died on February 27, 2006

The Modern Museum ---

Isabel Samaras Paintings ---

Geodesic Drawing ---


Online Books, Poems, References, and Other Literature
In the past I've provided links to various types electronic literature available free on the Web. 
I created a page that summarizes those various links ---

America:  Why I Love Her by John Mitchum---

Poems by Rudyard Kipling (1865-1936) --- Click Here

Digital Orchid Library from Michigan State University ---

Poetry Foundation (probably the wealthiest of the foundations) ---

The Lotus Eater by W. Somerset Maugham ---
Other short stories by Maugham ---

Short Story Classics ---

General Sherman’s Memoirs --- Click Here
Sherman House Museum ---

Economic History Classics ---

A  Cloud of Dust: John Updike Reviews "The March"---

E.L. Doctorow links in the Scout Report on February 24, 2006

E.L. Doctorow wins PEN/Faulkner Award Doctorow’s ‘The March’ Wins Top Honor --- Click Here

NPR: E.L. Doctorow on Sherman and ‘The March’ ---

2006 PEN/Faulkner Winners ---

Wired for Books: Audio Interview with E.L. Doctorow ---

Uknakkahhapssshefauknallahpsehefhpa _ _ _ uknakkahhapssshefauknallahpsehefhpa
Supreme Court Judge Ruth Ginsburg commenting on a case in progress.
"Snorer in the court? Ruth Bader Ginsburg snoozes Justice dozes off during political redistricting hearing, colleagues let her sleep,"
, March 1, 2000 ---

Women who seek to be equal with men lack ambition.
Bumper Sticker

Veni, Vidi, Velcro. I came, I saw, I stuck.
Bumper Sticker

Veni, Vedi, Visa: I Came, I Saw, I shopped.
Bumper Sticker

Damaged people are dangerous; they know they can survive.
1993 movie 'Fatale', directed by Louis Malle, screenplay by David Hare.

Deterrence is the art of producing, in the mind of the enemy, the fear to attack!
1964 movie "Dr. Strangelove or: How I Learned to Stop Worrying and Love the Bomb" screenplay by Stanley Kubrick, Terry Southern and Peter George.

Residents of one Hartford neighborhood hope Beethoven and Mozart will help drive drug dealers and prostitutes out of a local park.
Newsday, March 4, 2006 --- Click Here

I don't skinny dip,
I chunky dunk!

Forwarded by Auntie Bev

I can't jog anymore,
The rubbing of my thighs sets my tights on fire.

Forwarded by Auntie Bev

They lied! Hard work killed lots of people.
Forwarded by Auntie Bev

A balanced diet is chocolate in both hands.
Forwarded by Auntie Bev

Once upon a time I called the florist and ordered some flowers delivered to my wife at work . As she carefully explained to me, in some cases the value of a gift is negated when there is minimal effort involved.
Scott Bonacker, CPA Springfield, Missouri

The teacher's aide accused of raping a 4-year-old at a Queens day care center told authorities she thought the boy was a willing partner.
Herbert Lowe, Sun-Sentinel, March 3, 2005 --- Click Here


Uproars, including street protests, often depend on the source rather than the content
A rabbi's criticisms of the Jewish faith might sometimes be considered anti-Semitic when coming from anybody other than a rabbi. Catholic priests have more latitude when criticizing the Roman Catholic Church.  For decades use of the word "queer" was absolutely forbidden in academe until gay leaders, writers, and Hollywood gave it acceptability.

Video can be aired in the Arab media that would cause riots on the streets if initially aired in the Western media. An example of such a video is linked below. It's a strongly pro feminist video that attacks how Islamic fundamentalists treat women. You probably will not find any reference to this video in the mainstream Western media. The Western media powerhouses most likely consider it more explosive than publishing a Danish cartoon.  The academic academy wants no part of it because of this feminist atheist's "trashing" of Islam.

A  MEMRI subtitled video initially aired in the Arab media by Al Jazeera
Original version --- Click Here
A better version is at  

The early part of the above video itself claims that the main woman speaker is an Arab-American Psychiatrist. I did not know where her home is, although the Arab-American depiction of her suggested to me that she’s living in America. After discovering this video I later learned a bit more about this Arab-American Psychiatrist whose name is purportedly Wafa Sultan. She's an atheist Syrian expatriate. One of her papers is entitled "Who Are The Muslim Brotherhood Trying to Fool?" She' also expounds a "rhetoric against Zionists, Yankees, Imperialists, Crusaders."

I think it speaks well for Al Jazeera to have even aired the video. I visit Al Jazeera daily and find it to be sometimes well rounded and balanced in its article. Al Jazeera seems to be quite supportive of the democratic movement in the middle east. You can judge for yourself at 

Al Jazeera also broadcasted an interview with Wafa Sultan that you can read about at "LA psychiatrist clashes with Algerian jihadist over Islamic teachings and terrorism" ---

MEMRI translations of the Arab media are a source of controversy. The MEMRI home page is at

Other MEMRI-translated videos ---

You can read Brian Whitaker's critical article about MEMRI (not the above video per se) at,7792,773258,00.html 

A rebuttal to Whitaker's criticisms also appears in The Guardian
"Media organisation rebuts Whitaker accusations of selective journalism" ---,10551,778373,00.html

Brian Whitaker's Selective Memri is an example of selective journalism. Disregarding the Guardian's own code - "A newspaper's primary office is the gathering of news" - Whitaker has simply recycled inaccurate and previously published material.

Two days before his piece appeared on the web, he called our Washington office to ask for the Arabic original of an article translated by Memri from the London daily Al-Hayat. He could have used this opportunity to check his facts. He chose not to do so.

MEMRI accused of biased selections of what to translate rather than the translations themselves
Because the primary criticism that is leveled at MEMRI is nothing to do with the quality of its translations, but with the fact that it deliberately selects the most extreme articles and opinions from Middle Eastern news media, and presents them as being representative of the Arab and Muslim world in general. I’m not sure how important it is to emphasize that the individual articles cited by MEMRI are true (i.e. accurate translations), if the purpose of translating them is to use them collectively to make a point that is not true.

Lawrence of Cyberia Blog, January 4, 2006 ---

March 27, 2006 Update
MEMRI claims to be an independent nonpartisan research institution. One of the co-founders of the organization, Yigal Carmon, is a retired Israeli military intelligence Colonel. Checking the MEMRI website, I found it served up blatant, unbalanced propaganda and was littered with inflammatory articles aimed to incite hate and bigotry toward any person whom MEMRI considers anti-Israeli or anti-Zionist.
"Speakout: MEMRI's systematic distortion," by Rima Barakat, Rocky Mountain News, March 27, 2006 --- Click Here

March 10, 2006 message from a friend


A friend sent me the Wafa Sultan video, MEMRI translated (link below). It read well as a transcript when you posted it, but the video is 4x more powerful. An impressive and courageous woman--worth spending 4 minutes watching. 

Also see Also see 


The Jerusalem Post reported an interview with Wafa Sultan --- Click Here

Dr. Wafa Sultan's Life Threatened
"Muslim's Blunt Criticism of Islam Draws Threats," by John M. Broder, The New York Times, March 11, 2006 ---
Click Here

LOS ANGELES, March 10 — Three weeks ago, Dr. Wafa Sultan was a largely unknown Syrian-American psychiatrist living outside Los Angeles, nursing a deep anger and despair about her fellow Muslims.

Today, thanks to an unusually blunt and provocative interview on Al Jazeera television on Feb. 21, she is an international sensation, hailed as a fresh voice of reason by some, and by others as a heretic and infidel who deserves to die.

In the interview, which has been viewed on the Internet more than a million times and has reached the e-mail of hundreds of thousands around the world, Dr. Sultan bitterly criticized the Muslim clerics, holy warriors and political leaders who she believes have distorted the teachings of Muhammad and the Koran for 14 centuries.

She said the world's Muslims, whom she compares unfavorably with the Jews, have descended into a vortex of self-pity and violence.

Dr. Sultan said the world was not witnessing a clash of religions or cultures, but a battle between modernity and barbarism, a battle that the forces of violent, reactionary Islam are destined to lose.

In response, clerics throughout the Muslim world have condemned her, and her telephone answering machine has filled with dark threats. But Islamic reformers have praised her for saying out loud, in Arabic and on the most widely seen television network in the Arab world, what few Muslims dare to say even in private.

"I believe our people are hostages to our own beliefs and teachings," she said in an interview this week in her home in a Los Angeles suburb.

Dr. Sultan, who is 47, wears a prim sweater and skirt, with fleece-lined slippers and heavy stockings. Her eyes and hair are jet black and her modest manner belies her intense words: "Knowledge has released me from this backward thinking. Somebody has to help free the Muslim people from these wrong beliefs."

Perhaps her most provocative words on Al Jazeera were those comparing how the Jews and Muslims have reacted to adversity. Speaking of the Holocaust, she said, "The Jews have come from the tragedy and forced the world to respect them, with their knowledge, not with their terror; with their work, not with their crying and yelling."

She went on, "We have not seen a single Jew blow himself up in a German restaurant. We have not seen a single Jew destroy a church. We have not seen a single Jew protest by killing people."

She concluded, "Only the Muslims defend their beliefs by burning down churches, killing people and destroying embassies. This path will not yield any results. The Muslims must ask themselves what they can do for humankind, before they demand that humankind respect them."

Continued in article

2006 Update on Wafa Sultan
Then again, she did have strong opinions about Islamic extremism, and she was utterly unafraid to express them. So if Al Jazeera wanted to talk to a wife and mother in Los Angeles about this important subject, sure, why not? Wafa accepted. What no one could have guessed was that she was about to become a controversial new voice in the Islamic world -- and for many moderate Muslims, a model of courage . . . It was Wafa Sultan's second appearance on Al Jazeera, last February, that brought her worldwide notoriety. This time, she debated Dr. Ibrahim Al-Khouli, an Egyptian cleric, and once again gave no quarter. "The clash we are witnessing around the world is not a clash of religions or a clash of civilizations," she declared. "It is a clash between two opposites, between two eras. It is a clash between a mentality that belongs to the Middle Ages and another that belongs to the 21st century." To Al-Khouli, she added, "You can believe in stones, brother, as long as you don't throw them at me." . . . Wafa has also paid a price within the Muslim community in Los Angeles. Before she became a known activist, she had a busy social life with other Middle Eastern women. Today, few of her old friends remain. "They begged me to stop," she explains of the women in her circle. Some feared for her life; others reviled her message. Wafa summarizes their reaction this way: "You can't make any change, so why are you risking your life?"
Kerry Howley, "Breaking the Silence One woman is risking her life to speak the truth about radical Islam," Readers Digest, December 2006 --- Click Here

"Clash of Whats?" by David Warren, RealClearPolitics, March 4, 2006 --- 

Sometimes I am brought up short by the clarity and courage with which someone else -- with more to lose than I have -- states a truth. I am a Catholic Christian, who often dismisses “secular humanists”. But I’m in awe of people like Canada’s Irshad Manji, the “Muslim refusenik”, who had the courage in her book The Trouble with Islam to directly confront the horrors done in Allah’s name -- in, as she put it, “Pick a country, any Muslim country.”

Another is Wafa Sultan, an Arab woman practising psychology, now living in the States. A self-professed “disbeliever in the supernatural”, she has posted essays on the Internet in Arabic, including research into the fate of women under various Islamic regimes. She has willingly and ably confronted Muslim fanatics on Arab TV, most recently on Feb. 21st, when she debated Dr Ibrahim Al-Khouli on Al-Jazeera. A transcript and video clips with English subtitles were made available this week by the Middle East Media Research Institute (“Memri”) -- an indispensable institution, based in Israel, that distributes hard information and accurate translations of documents from the Arab world. (It is useless to condemn it as “Zionist” -- everything Memri publishes is sourced and checkable.)

With great bravery, Dr Sultan confronts the “tu quoque” (“you too”) arguments of the apologists for Islamic terror -- refusing to let them change the subject from what they have done, said, and approved, to misty rhetoric against Zionists, Yankees, Imperialists, Crusaders. Boldly on Al-Jazeera, last week, she said what our Western politicians, media flaks, and academic celebrities won’t say, from cowardice in its many forms. Excerpt:

“The clash we are witnessing around the world is not a clash of religions, or a clash of civilizations. ... It is a clash between civilization and backwardness, between the civilized and the primitive, between barbarity and rationality. It is a clash between freedom and oppression, between democracy and dictatorship. It is a clash between human rights, on the one hand, and the violation of these rights, on the other. It is a clash between those who treat women like beasts, and those who treat them like human beings. What we see today is not a clash of civilizations. Civilizations do not clash, but compete.”

The sparkling TV host interrupts to ask if Dr Sultan insinuates the clash is, “between the culture of the West, and the backwardness and ignorance of the Muslims”. Dr Sultan replies, “Yes, that is what I mean.”

The host reminds her that this phrase, “clash of civilizations”, came from Samuel Huntington, not Osama bin Laden. Dr Sultan reminds him that Islamic books and curricula, going back to the Koran, are full of calls for “fighting the infidels”.

When her opponent, Dr Khouli, claims he never offends people, Dr Sultan reminds that among other things he calls Westerners “al-Dhimma” (i.e. the Muslims’ natural slaves), that he routinely compares them to apes and pigs, that he calls Christians “those who incur Allah's wrath”, and so forth.

He asks if she is a heretic. Dr Sultan says, he can call her what he likes. He continues, “If you are a heretic, there is no point in rebuking you, since you have blasphemed against Islam, the Prophet, and the Koran!” She replies, “These are personal matters that do not concern you. ... Brother, you can believe in stones, as long as you don't throw them at me.”

And after the usual banter about Zionism, she notes that since the Holocaust, the Jews have made the world respect them by their work and knowledge, not their crying and yelling. “We have not seen a single Jew blow himself up in a German restaurant. We have not seen a single Jew destroy a church.” Likewise, though professing Muslims turned ancient Buddha statues into rubble, “We have not seen a single Buddhist burn down a mosque, kill a Muslim, or torch an embassy.”

Since the 9/11 attacks on New York and Washington, many thousand other barbaric acts have been reported, around the world, each one performed explicitly in the name of Allah. This is fact, not prejudice, and our refusal to make Islam an issue plays directly into the fanatics’ hands.

It is not our business to “define Islam”, as so many Muslims aver. It is the Muslims’ duty to define it, in such a way that we will not mistake it for a sword held to our own throats. For when it is presented as a sword, it becomes our business.

Jensen Comment
I mentioned above that one of her papers is entitled "Who Are The Muslim Brotherhood Trying to Fool?"
She' also expounds a "rhetoric against Zionists, Yankees, Imperialists, Crusaders."

If you do a Google search on Wafa Sultan you will get hundreds of hits (mostly on blogs) ---
You will notice that blog hits are frustrating. Google will take you to the blog site but not to the entry about your topic. It pays to know the date your topic appeared on the blog.

The following tidbits appeared in former editions of Tidbits and New Bookmarks ---

Ignorance is not bliss:  10 million children in the Arab world are out of school
Half of the women in the Arab world are illiterate and more than 10 million children in the region do not go to school, a report has revealed. The report on the status of children and women, produced by the Arab League and the UN Children's Fund (Unicef), said many Arab countries have made progress on child rights and protection, but that more still needs to be done. "More than 10 million children in the Arab world are out of school, most of them in Egypt, Iraq, Morocco and Sudan," said the report, although it gave no figures for the total number of school-age children in the region.
"Report: Half of Arab Women Illiterate," Al Jazeera, April 12, 2005 ---

Murdering Women For "Honor"
Today we are witnessing the globalization of honor killing, as the West has become the perpetual scene of immigrant Arab women being murdered by their immigrant families. A distinguished panel joins us today to discuss what causes this violence against women, how it is directly connected to the terror war, and why the Western Left is so deafeningly silent about a mass crime that violates one of its supposed sacred values . . .
Jamie Glazov, "Symposium: Murdering Women For 'Honor',", June 10, 2005 ---

Meanwhile in Nigeria
They all have one thing in common, the determination to liberate Muslim women, who they claim, were still relegated to the background in utter disregard for their rights and priviledges as set forth in the Islamic legal code, Sharia. With the issue of stoning to death, caning and amputation, remaining the dominant Muslim news in national dallies, the Women of Hounour, as the are referred, women had decided to reverse the trend and restore dignity to such oppressed members of the society. Alhaja Sikiratulahi Atinuke Atobajaye (Iya Suna of Nigeria, President General, Nuru-ul-Islam International Alasalatu of Nigeria), Alhaja Fausat Taiwo Afolabi, Director, Office of Local Government Administration, Lagos State, Alhaja Fariat Tinubu, Director, Personnel Management, Amuwo Odofin Local Government Area, and Sayyidah Zeenat Abiola Kalejaye, all members of the Aenu Rahmat Faedot Tijani-yyat of Nigeria, were so deservingly honoured for championing the crusade against the plight of Muslim women in Lagos, recently.

"'ISLAM ACCORDS MEN, WOMEN EQUAL STATUS'," by Andrew Ahiante, Lagos, PeaceWomen, October 13, 2003 ---


In pursuit of Arab reform
This special report is concerned with the increasingly pressing demand for reform in the Middle East. While few harbour any illusions over the need for such a compelling change, the disagreement centres on the question: How?

"In pursuit of Arab reform," Al Jazeera, May 20, 2004 ---

The Koran and the Kafir
The chapter on the Koran and Moslem women gives us some idea on Islam's injunctions on Moslem women. They should cover their bodies from head to foot. Khomeini's Iran forces the women to go under the 'chador'. They must not go outside to work where other men might see them. They may not be rulers or judges in an Islamic state. Women lawyers are frowned upon in today's Pakistan which is an Islamic state. But such regulations are valid for Moslem women only. The non-Moslem or kafir women are to be handled differently, as the Islamic codes are not birding on them. The kafir women are considered to be the property of Moslems; they are their 'slaves'' and the wife or daughter of a 'zimmi' can be molested by a Moslem with impunity in a Moslem state ruled by the 'Sharia' or Islamic jurisprudence. The idea comes from the treatment meted out to kafir women who were captured in the battlefield. The first fifth of all booty went to the prophet or the caliph or whoever happened to hold the position of the amir-ul-mominin. It could be the Moslem king of the land or even a petty chieftain. This so called leader 'examined' all booty, inspected and sometimes 'felt' by touching it. The women, all of them were paraded in front of the leader, naked or scantily clad, so that the leader could make his choice. These women were NOT brought in front of the 'amir-ulmominin' dressed in 'chadors'. It was thus that the prophet himself used to inspect his captives and chose Rehana and Juwairiya' both Jewish women whose male relatives were all killed by the Moslems. Juwairiya eventually gave up her religion and married the prophet and became one of the ten or eleven wives of his harem. Rehana was a courageous lady and she did not give up her Jewish faith and so was turned into a concubine of the prophet. She thus took her place on the side of Mary, another slave woman, and a Christian, who after Khadija gave birth to a male child fathered by the prophet.

"The Koran and the Kafir," by A. Ghosh ---

Jewish Women and the Feminist Revolution (History) ---

"Iraqi Women Should Think Twice Before Accepting Constitution," by Jan Erickson, Government Relations Director, National Organization for Women (NOW)---


Sharia Anti-Women?

National Organization for Women President Kim Gandy said the women of Iraq will lose hard-won rights under the new constitution, and the U.S. will share the blame for trading away women's rights.

"Iraqi women will have far fewer rights under this constitution than they have enjoyed for decades, and for this reason all Iraqi women should pause to consider whether they will vote for it," Gandy urged in August. "Adoption of this constitution will likely result in the loss of rights gained over past decades. Conservative Sharia law as the basis for the country's family law system threatens to send Iraqi women back to the Middle Ages."

. . .

Critics say that Sharia law is inherently misogynistic: In some sects, divorce is easy for men who are allowed multiple wives, and custody of children goes to the father. A conservative dress code requires many women to cover most or all of their bodies; women may be restricted to the home and are frequently not allowed to speak to men other than relatives. Women are not allowed to be clergy or religious scholars and may be restricted from certain jobs where they might come into contact with men.

Worst of all, most interpretations of Sharia law allow beating of "disobedient" wives. This permission has led to the practice in many Muslim cultures of so-called honor killings where women are beaten or murdered if the family believes that the woman has 'dishonored' the family with an extramarital affair.


When is surgery the right choice for back pain?
Americans get surgery for lower-back pain at a higher rate than any other country. Whether that's too many, too few -- or just right -- is a hotly debated subject in orthopedics. At the center of the debate is how to decide who should get surgery for lower back pain . . . Each consulted Dartmouth Medical School's Dr. James Weinstein, one of the nation's leading experts on back pain. In fact, Weinstein has had back pain himself. . . . The bottom line right now: Patients need to be involved in deciding whether to have surgery. Weinstein says it may even help their outcome, whatever they decide. Weinstein is heading a federally financed study of 1,200 patients with chronic lower-back pain to compare the benefits of surgery and nonsurgery. Results are due this summer.
"For Back Pain, Few Easy Answers on Surgery," by Joanne Silberner, NPR, March 2, 2006 ---
Jensen Comment:  My wife has had eight surgeries on her spine. Each surgery seems to make the pain worse. The Dartmouth Medical Center (called Hitchcock) is now proposing that she have a huge ninth surgery to put rods in front of and in back of her spine. The rods put on just her backside failed and had to be removed.

Headaches 40% more common among women taking birth-control pills
Some women have migraines during menstruation, when levels of estrogen drop, Dr. Karen Aegidius of the Norwegian National Headache Center in Trondheim, the study‘s lead author, told Reuters Health. These women also are more likely to have migraines while taking oral contraceptives, she added, explaining that these pills can boost estrogen levels up to four-fold above normal, resulting in a particularly steep estrogen drop-off with menstruation.
Anne Harding, "Study confirms oral contraceptive-migraine link," Reuters Health via News One, March 2, 2006 ---

Who's Harvard's dapper hombre feminists love to hate?
Hint: It's not Larry Summers. In fact this Harvard hombre implies Larry Summers is a wimp.

"Harvey Mansfield Calling All Hombres," by Naomi Schaffer Riley, The Wall Street Journal, March 4, 2006; Page A8 ---

CAMBRIDGE, Mass. -- "Defend yourself." That's the lesson Harvey Mansfield drew for Larry Summers the week before Harvard's president was forced to resign. Mr. Mansfield, a 73-year-old government professor and conservative elder statesman of the university, went on to suggest that Mr. Summers's capitulation to those he offended (when he said women might be biologically less inclined to succeed in the hard sciences) is not simply a craven kowtow to political correctness, but proof, also, of a character flaw. Indeed, Mr. Mansfield continued with a mischievous smile, "He has apologized so much that he looks unmanly."

Perhaps this seems like a quaint insult, but Mr. Mansfield means something very particular by it. He would like to return the notion of manliness to the modern lexicon. His new book, "Manliness" (manfully, no subtitle), argues that the gender-neutral society created by modern feminists has been bad both for women and men, and that it is time for men to rediscover, and women to appreciate, the virtue of manliness.

Mr. Mansfield's former office in the grand neoclassical Littauer Hall just off Harvard Yard seemed better suited to his project, but the government department moved into a new building this year and he has been relegated to a spare, modern room in which even the blinds are operated electronically. The professor, with his elegantly tailored suits and sharp fedoras, looks out of place in his ungracious surroundings. (The poster-size portrait of Machiavelli, about whom he has written extensively, doesn't seem to fit in either.)

But after more than a half-century at the university -- as undergrad, grad student and professor -- Mr. Mansfield seems to have settled into his role as campus gadfly. This is not to say that scholarship and teaching do not occupy his time. In the past 40 years, he has published more than a dozen books, including a translation of Tocqueville, as well as groundbreaking studies of Machiavelli and Burke.

But it is his combat with campus liberal orthodoxy that has brought him a more public profile. To drive home his crusade against grade inflation, he began giving students a real grade (what he actually thinks of their work) and an "ironic grade" (which goes to the registrar). More controversially, Mr. Mansfield argues that grade inflation is the result of the university's affirmative-action program -- admitting too many underqualified minority students and then not wanting to give them poor marks.

Of all the enemies Mr. Mansfield has made, none has he more consistently provoked than feminists. It's been 20 years since he voted against the proposal for a women's studies major at Harvard (the only faculty member to do so), arguing that "it is not possible to study women except in relation to men." And he has not let up since.

"I've had a lifelong interest in women," Mr. Mansfield purrs in his smooth classical-radio-announcer voice when I ask why he decided to embark on his manliness project. Joking aside, he explains that "I always wanted to write a book on the woman question, and one reason, perhaps the main reason, I see is that we are embarked on a great experiment in our society, something very radical: to make the status of men and women equal, or, better to say, the same."

Mr. Mansfield's contention that women and men are not the same is now widely supported by social scientists. The core of his definition of manliness -- "confidence in a risky situation" -- is not so far from that of biologists and sociologists, who find men to be more abstract in their thinking and aggressive in their behavior than women, who are more contextual in their thinking and conciliatory in their behavior.

Continued in article

Jensen Comment
Professor Mansfield has been a long-standing critic of grade inflation at Harvard University. To read more about his articles on this go to

Increasingly I am receiving requests from teachers and students in Africa, Asia, and elsewhere around the world. Often they are asking some very basic accounting and finance questions.  What are the most efficient ways to help them with these basic, and sometimes advanced, questions?

Answer from Bob Jensen
As most of you know, my Web documents and multimedia tutorials on two servers have become huge. Even I have finding my own stuff unless I use Google in search of my own deeply embedded modules. Most of my tutorials and other helpers in accounting and finance were written for my graduate students and my off-campus audiences in my traveling dog an pony shows. Unfortunately I do not have Web documents for elementary tutorials. And at the advanced level, there are many topics that I have not covered in tutorials.

How do I help with things that I've not covered in my tutorials? It finally dawned on me to check for Wikipedia links when people write to me for help. You might consider this same approach to save time when trying to help people who make inquiries around the world. When people write to me for help with basic concepts, I now check the quantity and quality of what has been written about these concepts in Wikipedia. The Wikipedia modules are often very good, often better than my tutorial would have been if I took the trouble to write my answers to the hundreds of inquiries I receive from around the world.

My skill in helping others has largely been in knowing what terms or sub-terms to search for on the Web. Now I use these skills to first search for Wikipedia modules. Then I do a search for other helpers that I can find in my own sites and in other sites on the Web. But first I check on Wikipedia for explanations and links  ---

By way of an illustration, I recently received an email from an accounting teacher in a developing country. He/she asked some very basic questions. A sample of part of my long reply to this teacher is shown below:

People often ask why I've poured thousands of hours in developing my accounting and finance tutorials that I share with the world on two Web servers. Answering inquiries from teachers, students, reporters, practitioners, and others has become my great joy in life. But since I receive hundreds and hundreds of inquiries I must resort to efficiency measures. My main efficiency measures are as follows:

  1. Put as much of you own stuff, documents, audio, and video, as possible on your Web servers so that you can simply point to research and other answers that you’ve previously prepared. Sometimes new inquiries inspire me to improve my tutorials.
  2. Some of the people who might contact you do not even have a textbook on the subject. Try to recommend free textbooks that can be downloaded from the Web. Some examples are given at
  3. Learn the sites on the Web that provide a lot of great answers, particularly the Wikipedia site. Unfortunately I've been negligent in improving Wikipedia modules and creating new modules. Perhaps I will find time to this after I've retired on May 13, 2006.
  4. Belong to listservs and forums of specialists who are willing to answer questions that you yourself cannot answer. I've been blessed with some of these, notably one called the AECM.

It will make you feel good to help strangers who send you questions about technical issues in your craft. Try to help these people in need, but you must become efficient in providing high quality answers. And by all means admit your own ignorance when you cannot answer something. Don't try to waste their time by pretending or getting them lost in technical documents only remotely related to the questions raise.

Is Byetta a weight loss miracle for diabetics?

"A Ray of Hope for Diabetics," by Alex Berenson, The New York Times, March 2, 2006 ---

The users call the drug Lizzie, the Big Brother or sometimes Gilly. On blogs they rave over its uncanny ability to melt away pounds, although some are wary of its side effects, which can include nausea and strange welts.

The users are not fad dieters or methamphetamine addicts, but people with diabetes. And the subject of their rhapsodies is not a gray-market diet pill sold on late-night television but Byetta, a federally approved diabetes medicine, available only by prescription, whose popularity and sales have soared since its introduction last June.

For diabetics, the weight loss caused by Byetta comes as a welcome contrast to the weight gain that often accompanies insulin and other diabetes medicines; the extra pounds can eventually worsen the disease. Some patients say Byetta has reversed the course of a disease that can lead to severe complications like amputations, blindness and kidney failure and even death.

Continued in article

Updates from WebMD ---

What really fueled Hitler's regime? Hitler's Bank Bares Its Dark Past

Dresdner's self-financed study reveals that greed rather than ideology inspired its zealous support for the regime, even to helping build Auschwitz. There's no way to put a positive spin on German industry's collaboration with the Nazi regime before and during World War II, so Dresdner Bank Chief Executive Herbert Walter didn't try. Presenting the results of an independent study of Dresdner's role in the Holocaust, Walter admitted: "It confronts us with bitter historical truths. We accept these truths, even when they are painful."
Jack Ewing, "Hitler's Bank Bares Its Dark Past:  Hitler's Bank Bares Its Dark Past," Business Week, February 22, 2006 --- Click Here

Painful is hardly a strong enough word. According to the study by a team of historians from German universities, Dresdner functioned as the house bank to Hitler's Schutzstaffel (SS), lending more money than any other bank to the organization that was at the forefront of the most ghastly atrocities. Dresdner, co-founded by Eugen Gutmann, who was Jewish, quickly expelled its Jewish employees after the Nazi takeover and arbitrarily cut the pension payments of Jewish retirees. The bank even owned a stake in the construction company that built the crematorium at the Auschwitz concentration camp.

It has become almost a ritual for big German companies to finance detailed studies of their Nazi collaboration. Volkswagen, DaimlerChrysler (DCX ), Siemens (SI ), and even menswear maker Hugo Boss (HUGSF ) have owned up to their histories. Part of the motivation may be genuine remorse, but companies also have learned that attempts to spin history can backfire.

Bertelsmann suffered severe embarrassment in 1998 when a German journalist, Hersch Fischler, punctured the myth that the Gütersloh-based media giant had resisted the Nazis and suffered a shutdown of its book-publishing business as a result. In fact, the company later conceded, Bertelsmann had profited handsomely from supplying morale-building books to German troops and was shut down near the end of the war only to save paper.

Since then, companies have learned that it's better to confront the past themselves than to wait for an enterprising historian or journalist to do so. The self-examination is a prerequisite to being a global player from Germany. "Apparently, they expect to be more involved in the global community in the next decade. They want to start in a clear position," says Cees B.M. van Riel, a professor who teaches corporate communications at RSM Erasmus University business school in Rotterdam, The Netherlands.

As Walter conceded in a statement, Dresdner suppressed its own history until the mid-1990s when, under pressure from critics, it commissioned the study. Dresdner's close ties to top Nazis were already well-known; Chief Executive Karl Rasche, an SS member, was tried and sentenced to a prison term at Nuremberg.

But the study makes clear that Dresdner's wartime culpability was much deeper, and the motive was money rather than politics or Nazi pressure. The bank "took advantage of all the business opportunities opened up by the aggressive and racist policies of the Third Reich," study co-author Johannes Bähr concludes.

Despite the bank's own Jewish origins, it played a key role in the persecution of German Jews, according to the study. After Jewish employees were expelled in 1933, Dresdner exceeded even Nazi race laws in cutting their pensions or severance payments. As Jewish businesses were being "Aryanized," the bank hired thuggish "business consultants" to intimidate owners and seize control.

After the war began, bank executives knew early on about crimes taking place in concentration camps, according to the study. Dresdner provided banking services to numerous SS facilities. The bank was a major shareholder in a construction company, based in Breslau (now the Polish city of Wroclaw), which built crematoriums at the Auschwitz death camp. "Particularly in the case of its most reprehensible activities, the bank could have operated differently," Bähr writes.

Continued in article

Everybody Should Read This:  Evil Doers of the Future Extend Well Beyond Islamic Fundamentalists
Extremism, Terror, and the Future of Conflict

By Michael J. Mazarr Michael J. Mazarr is professor of national security strategies at the U.S. National War College and adjunct professor of security studies at Georgetown University. The views expressed here are his own and do not reflect the policy or position of the U.S. government or the National Defense University.

Hoover Institution's Policy Review, March 2006 ---

When they briefly stated an intention to begin referring to a “global struggle against violent extremism,” certain officials in the Bush administration did more than implicitly acknowledge the vacuity of the idea of a “global war on terror.” They hinted, however obliquely, at something far more profound: a radical shift in the nature of conflict, what it means to be “at war.” From traditional notions of armies fighting armies in vast confrontations, the new concept seems to imply, the warfare of the future will look very different — twilight struggles against non-state networks of evildoers. This notion mirrors an emerging...


The theory of war that undergirds realpolitik is straightforward. For thousands of years, warfare has meant a clash of wills between opposing military forces on the field of battle, from which one side usually (though not always) emerged as a recognizable winner. The causes of such wars were the combination of an anarchic system of self-help that opened the way for aggressive and imperialistic campaigns of conquest, bitter competitions over scarce resources, escalating mutual security fears, and misperception and miscalculation. Conducting war meant the mobilization of resources and military units to defeat enemy forces in the field. It is from this basic concept — states at war employing organized military units — that most of the hallmarks of modern military science flow: the moral and physical clash of wills; the role of the decisive battle in a campaign; and the endless search for the enemy’s “center of gravity” and the “culminating point” of a conflict.

But we have been moving away from this paradigm for some time.2 Centuries ago, military forces were very nearly divorced from the societies on behalf of whom they fought: crowds of adventurers out at the frontier and beyond, staging highly ritualized über-duels on grassy plains, while the home society went on farming and hunting and carpentering. To be sure, these armies would affect the surrounding societies in profound ways: They would recruit or dragoon young men who otherwise would be farming or cobbling; they would pillage the surrounding landscape as they passed through it; and they would sometimes draw abundant camp-following crowds. But the basic model was one of a quasi-independent army marching off to find its counterpart and slaughter it. Even by Napoleonic times, armies remained remarkably separable from their peoples, grand militarized playthings moving around the chessboard of strategy.

And playthings they were, because armies and navies were the instruments of their leaders — sometimes individual kings or tyrants, sometimes collective groups, but always leaders in search of some self-defined material end, the governing power goal of realpolitik. Philip of Macedon could decide that the time had come to unify the Greek city-states, and off went his army to battle. The Romans could elect to subjugate yet another frontier people, and the legions gathered up their equipment. Kings and princes in early modern Europe, reflecting perhaps the apotheosis of this practice, marshaled bands of expensive knights and attendants in what looks to modern eyes almost like an elaborate game. Even when wars emerged without clear power-seeking intent, issues of security dilemmas and power rivalries always hung about the proceedings.

In such a context, the enemy’s forces in the field embodied very nearly the entirety of the conflict. When they were destroyed, the enemy was vanquished. What “the people” thought about it, hacking away at their farms a thousand miles from the battlefield (or even right next door to it), usually had little or no bearing on the outcome — except when especially reckless leaders bankrupted the home front to such a degree that they were overthrown while on campaign. Even when forces became nimbler and strategy emphasized moving between, around, and behind an enemy to get at his capital or his industrial heartland, these supposedly indirect strategies mostly ended up in force-on-force butchery.

In its actual practice (as distinct from its consequences, which frequently transformed societies from the roots up), then, war stood apart from society, independent, self-regarding. Warfare was armies against armies, and when it became something more than that — the destruction of whole societies, for example — it remained largely in service of the narrower goal: to cripple the enemy’s military instrument, and thus compel his surrender. The character of war in this theory was fierce and brutal, built as it was around the organized employment of violence to break an enemy military’s will.3

All of this made sense in a world governed by the doctrine of realpolitik. From Thucydides onward, the concepts of a realist approach to world politics were clear enough: States sought power; there was no world authority to govern the resulting conflict; stronger states took what they could, weaker ones succumbed or hid under the protective umbrella of alliances. Above all, military power and the diplomatic and political influence that flowed from it was the coin of the realm for the players in the international game, the sine qua non in whose absence no other state powers or goals could be reliably sustained.

For centuries, perhaps millennia — from the Peloponnesian War through the German advocates of machtpolitik — this situation was not only admitted, it was frequently celebrated. The world was a great Darwinistic struggle and courageous peoples sought power and used it. Warfare was welcomed as a means of stiffening national character and a route to glory for individuals and cultures alike — a perverse notion that, sadly, has not quite been put to rest.4 Later, British and American realists mourned the reality of power politics and warned against imperial expansion, but pronounced both of them unavoidable given the twin natures of world politics and human nature. Either way, as a positive doctrine or an empirical analysis, realism spoke to a world governed by unconstrained power rivalries, tragic misunderstandings, and, ultimately, force-on-force military confrontations.



With this background, it becomes clear that one claimed shift in the nature of war does not, in fact, describe any change at all. It goes under the current name of “transformation,” but even the concept is hardly new. Transformation is the child of the Revolution in Military Affairs (RMA) — itself a grandson of maneuver warfare and blitzkrieg, which have their roots in the renewal of strategic thought following the First World War. As one analyst explains it, attrition warfare (an especially slaughterous variant of the canonical force-on-force style) aspired to the annihilation of enemy forces. Maneuver warfare targets

the coherence of the adversary’s combat systems, methods, and plans. The hope is that a very selective action can have a cascading effect — an effect disproportionately greater than the degree of effort. An analogy from architecture would be the removal or destruction of the keystone of an arch . . . the removal of which disrupts the stability of the system, resulting in its destruction.5

But the “system” is still the enemy military capability. Maneuver warfare is just a more elegant way of dealing with the usual force-on-force confrontation.

And so are its descendants. The Soviet theorists of the “military-technical revolution” — who were themselves influenced by American writings, and whose concepts Americans then translated into the RMA — were interested in more or less the same things as the German blitzkriegers: slicing up, destabilizing, and defeating enemy forces, only this time with weapons energized by a revolution in microelectronics, computing power, precision strike, and automation. Radical new concepts of command and control, “networked” organizations, “information dominance” — this and much else on the Defense Department’s transformation menu — therefore reflects the latest and most efficient elaboration of the principles of maneuver warfare. Some of the documents of the Office of Force Transformation point to a broader agenda,6 but if we look at the practical efforts of the Defense Department — where its budget goes, what its troops are trained to do, how its operations are conducted — the emphasis remains stubbornly on the force-on-force route to military victory. The primary modernization agendas of the services today speak to the same deep-rooted goal: finding tanks, planes, ships, and people that belong to the enemy and making them explode.

Transformation advocates have grown dextrous in the use of bold terms. They call the whole enterprise “network-centric warfare” and speak of “information superiority” and “shared awareness.” They refer to “systems of systems” and “linked platforms of sensors, shooters and commanders in seamless webs,” and talk of the increased speed and greater lethality with which military operations will now operate.7 But whatever the language, network-centric warfare reflects principles that have governed force-on-force warfare for centuries: Rapid, effective command and control that allows you to get inside an enemy’s “decision loop” has been the goal of the great captains of history for centuries; precision-guided weapons are just the latest and most effective effort to hit enemy forces as accurately as possible.

Some elements of the transformation agenda speak to so-called “information warfare.”8 Like notions of transformation and “network-centric warfare,” accounts of information warfare generally say very little about what the thing actually is.9 Some writers have used the term “cyberwar,” by which they appear to mean the by now conventional idea that warring powers will try to destroy the computer systems of their opponents.10 One account points to the rise of domains that do not require physical force to attack, and the resulting extension of warfare “beyond the traditional military realm.”11

This is not the first time military strategists have pointed to the potential of new technologies to overcome age-old truths about war. Yet Clausewitz wrote the epitaph of “perfect information dominance” some time back: fog and friction. There will never be sensors numerous, accurate, or reliable enough to create a perfect information picture. There will never be information architectures capable of sharing the resulting information widely, perfectly, or quickly enough to allow forces in the field to rely on it.12

As partial evidence, we have a number of recent examples. In Kosovo, the Serbs managed to accomplish a vast amount of movement and operations without NATO knowledge.13 In the Iraq War, despite the full-scale application of sensor and communications technologies greatly more advanced than those of Operation Desert Storm, the most frequent military engagement may have been the venerable “movement to contact” — steaming ahead until you encounter the enemy, then groping your way around the battlefield until you find the right tactical answer for him. The Third Armored Division famously stumbled into the biggest conventional battle of the war without advance warning. Iraqi commanders were able to move huge units around the battlefield without being seen or detected, until more Americans on “movement to contact” orders plowed into them. The immense success of the U.S. and allied drive to Baghdad was far more a product of the tactical skill of middle-level U.S. commanders than it was a victory for sensors and “network-centric operations.”



It is hardly surprising that all of this transformational and network-centric jargon would add up to so little in the way of truly new theories of warfare. These concepts are all about tactics and implementation; they have nothing to say about the causes of war, or the strategic implications of those causes.

From a definitional standpoint, there are at least three concepts at work in any discussion of “warfare.”14 First is the character of battle — the clash of arms where one army physically meets another. This is the meeting point that generates statements about the “unchanging nature of war” — violence, blood, courage, willpower, and so forth. At a second level we find the form of warfare, the tactics and operational art governing units in battle — infantry war versus blitzkrieg, insurgency versus classical force-on-force duels. Whereas the character of battle may be eternal, the form of warfare constantly evolves, responding to new technologies, new tactics, and new social organizations. But then we come, finally and most fundamentally, to the nature of conflict. This is the highest strategic level of analysis and deals with the causes and character of severe political-military-socioeconomic disputes in the international system. International conflict generates the context for warfare, but also much else — Schellingesque bargaining games, coercive diplomacy, deception and artful dodges short of warfare and battle.

Continued in article

Jensen Comment
What frightens me is the possible breakdown in confidence that our nation states can protect us. This may give rise to an explosion of militias with war lord mentalities. The becomes much more frightening with the possible availability of cheap dirty bombs and biological weapons.

Bob Jensen's threads on the "Evil Empire" are at

Nancy's latest scars from constituency spurs in her side (see "shout down" highlighted below)
San Francisco leaders have passed a resolution calling for President Bush’s impeachment on the accounts of bringing the country into war, sanctioning torture, spying on citizens and bungling the response to Hurricane Katrina. Members of the city’s board of supervisors have asked Congress to conduct a complete investigation of the administration's purported transgressions and hold offenders accountable with criminal prosecution or impeachment.
Joanna Wypior, "San Francisco Leaders Calling For Bush’s Impeachment," All Headline News, March 5, 2006 ---

Jon Stewart's "Donkey Show"
Normally I'm not a big fan of Jon Stewart, but I left The Daily Show on tonight while I worked on a couple of other tasks. Stewart reviewed the pandering done by Hillary Clinton and Ray Nagin yesterday, as well as the
shout down Nancy Pelosi received on Saturday when she (rationally) suggested to her constituency that their concerns on the war would best be addressed electorally in 2006 during a visit to San Francisco. At the end of the segment, titled "Donkey Show", Stewart noted this: So the Democratic platform appears to be ... Democrats are our government's slaves [Hillary added to graphic] ... New Orleans can't be rebuilt without Willy Wonka [Nagin added to graphic] ... and voting
(to surrender in Iraq) is for pussies [Pelosi added to graphic]. Good luck in 2006, everybody!
Captain Ed, Captain's Quarters, January 16, 2006 --- 
Jensen Comment
Latest Jon Stewart Videos ---
Jon Stewart Comedy Central Homepage ---
Jon Stewart Intelligence Page ---

San Francisco and India Have One Thing in Common: 
They will both fumigate after a visit by President Bush
Hindu priests who look after the memorial of Indian independence leader Mohandas Gandhi conducted a purification ceremony at the shrine after a visit from President Bush. But it wasn't the president who offended them, it was the sniffer-dogs who scoured the area ahead of his visit. After the dog visit, the memorial was cleansed with water brought from the Ganges river, which Hindus consider holy, the Hindustan Times newspaper reported Sunday.
"Priests Purify Shrine After Bush Visit," ABC News, March 5, 2006 ---

Why linking pay to stock prices is liable to do more harm than good

"Why Rules Can't Stop Executive Greed," by Daniel Akst, The New York Times, March 5, 2006 ---

In the arena of executive compensation, two recent developments stand out against the backdrop of continuing looting. First, the Securities and Exchange Commission announced plans to make corporations more fully disclose executive pay. Second, a study by Mercer Human Resource Consulting found that more companies were imposing performance targets on the stock and options they granted to C.E.O.'s.

To the uninitiated, these events may suggest that some moderation is in the offing, but ultimately neither will help much. Any benefit from shining the cleansing light of day on executive greed will probably be outweighed by the inflationary effect of additional disclosure, which will provide more ammunition for executives and consultants seeking to justify additional increases. They have to keep up with the Joneses, they'll say.

Tying pay more firmly to performance won't help, either. Boards will find ways around the requirements if performance isn't up to snuff, and they will continue to bid irrationally for unduly coveted executives.

As Rakesh Khurana showed in his insightful book, "Searching for a Corporate Savior: The Irrational Quest for Charismatic C.E.O.'s" (Princeton University Press, 2002), there is a much wider pool of potential chief executives than soaring pay levels would seem to imply. But companies insist on bidding for a savior, not a capable leader who knows the business at hand, which may be why typical C.E.O. tenures are now so short. Even in the boardroom, charisma carries you only so far.

Indeed, linking pay to stock prices is liable to do more harm than good. A stock price isn't much of a measure of executive performance, anyway. A huge part of that price reflects industry conditions; energy companies soared not because they were run by paragons of diligence or insight, but because of world events beyond any executive's control. In hard times, moreover, a company's stock may take a hit, but those are precisely the times when good leadership is most difficult — and valuable.

Other performance metrics can be equally troublesome, encouraging executives to massage earnings, sacrifice long-term strength for higher short-term sales and profits and otherwise act in ways detrimental to everyone but the C.E.O., his family and a few lucky divorce lawyers.

Perverse incentives notwithstanding, this focus on metrics is a sad acknowledgment by corporate directors that they cannot control themselves or the pay they hand over to their top five executives. In one study, two professors, Lucian A. Bebchuk of Harvard and Yaniv Grinstein of Cornell, found that from 2001 to 2003, such pay totaled roughly 10 percent of corporate profits at public companies. It's a bizarre twist on the tradition of tithing, one that benefits the rich instead of the needy and conscripts America's shareholders as involuntary donors.

Although more disclosure and pay-for-performance requirements won't dampen runaway C.E.O. compensation, both are useful for illustrating a larger lesson: that it's naïve to place too much faith in the power of rules to limit human behavior. Indeed, the problem of C.E.O. compensation suggests that, as in many aspects of modern life, few mechanisms of constraint are as effective as one on which we relied so often in the past. That mechanism was shame.

You'd think that more disclosure would produce more shame, and thus less pay, for C.E.O.'s and other top executives. Unfortunately, disclosure of a few more million here and there won't fundamentally change a hiring system that actively recruits the most grasping and hubristic candidates. Consider the incentives: by offering lavish pay and perks that would make royalty blush, corporate directors today are perhaps unwittingly selecting C.E.O.'s for shamelessness and egotism rather than leadership.

HISTORY teaches that there is no ultimate solution to the so-called agency problem, or the tendency of those who merely work in an enterprise to act in their own interest rather than that of the owners. Rules and incentives can help, of course, but they cannot take the place of an honest sense of obligation, duty and loyalty — values that ought to run in all directions in any decent corporate culture.

Continued in article

"The Case for Cutting the Chief's Paycheck," by William J. Holstein, The New York Times, January 29, 2006 ---

Bob Jensen's threads on outrageous executive compensation are at

The mice that roared!
What Jewish conspiracy is allegedly behind the historic "Tom and Jerry" cartoons and movies?

"Tom and Jerry – a Jewish makeover? Iranian official says cartoon is conspiracy to improve image of mice, Jews," WorldNetDaily, February 25, 2006 --- 

The Jewish Walt Disney Company gained international fame with this cartoon," said Bolkhari. "It is still shown throughout the world. This cartoon maintains its status because of the cute antics of the cat and mouse – especially the mouse.

"Some say that the main reason for making this very appealing cartoon was to erase a certain derogatory term that was prevalent in Europe."

According to the professor, "Tom and Jerry" was created to irradicate the association between mice and Jews created in the minds of Europeans by Hitler.

"If you study European history, you will see who was the main power in hoarding money and wealth in the 19th century," continued Bolkhari. "In most cases, it is the Jews. Perhaps that was one of the reasons which caused Hitler to begin the anti-Semitic trend, and then the extensive propaganda about the crematoria began. ... Some of this is true. We do not deny all of it.

"Watch 'Schindler's List.' Every Jew was forced to wear yellow star on his clothing. The Jews were degraded and termed 'dirty mice.' 'Tom and Jerry' was made in order to change the Europeans' perception of mice. One of terms used was 'dirty mice.'

Continued in article

March 6, 2006 reply from David Fordham, James Madison University [fordhadr@JMU.EDU]

Bob, your tidbits this week contains the following quote under your headline "What Jewish conspiracy is allegedly behind the historic "Tom and Jerry" cartoons and movies?": "The Jewish Walt Disney Company gained international fame with this cartoon," said Bolkhari. "

But you don't comment on the blatant inaccuracies of the media report you quote. I urge my students anytime they quote a known erroneous media report to at least acknowledge the wrong information, lest they be guilty of also promulgating falsehood, and lest their credibiilty suffer by repeating false information.

First, Tom and Jerry is not a Disney cartoon. Tom and Jerry was created in 1940 by William Hanna and Joe Barbera, who later produced many other cartoons as "Hanna-Barbera". Tom and Jerry cartoons have never had any affiliation with Disney.

Second, the creators of Tom and Jerry insisted until the end of their lives that there was no political or other motive behind the cartoon beyond pure fun with animation.

Third, Disney was most certainly NOT a "Jewish" company in 1940 when the Tom and Jerry cartoons were created by Hanna- Barbera, and even more certainly not with the creation of Mickey Mouse. Walter Disney was a tyrannical manager (not necessarily a bad thing!), and kept tight control on the creative processes at the company until his death, -- and Walt Disney was ... an active Congregationalist! Not Jewish.

While the Disney company has recently had some top management with Jewish-sounding names (who possibly could even be of Jewish extraction, or even practicing Jewish religion for that matter, I just don't know and don't care), I doubt seriously that any of them are exercising near the control that Walt Disney did on the creative processes.

To quote a news media report with such glaring errors in it without calling attention to the unfactual information is to (shudder, wince) imitate the WSJ and NYT! I respect your tidbits and would hate to see them sinking to that low a level...


David Fordham

Al-Qaida claimed responsibility for the foiled attack on a Saudi Arabian oil facility at Abqaiq
Aljazeera, February 25, 2006 --- Click Here
Also see The New York Times account on February 25, 2006 --- Click Here

What really fueled Osama bin Laden's 9/11 attack and other more recent attacks?
In what nation can he claim his only success in winning masses of new converts?
Hint: That nation is a long distance from the Middle East.

The money mostly came from Osama bin Laden's wealth in excess of $1 billion in family money. His initial goal is to topple virtually all governments of Muslim countries. His only success purportedly has been in Indonesia. Most other Muslim nations have not demonstrated increased allegiance for Osama bin Laden, although his El Quida cells lay hidden in all Muslim nations and most Western nations as well.

Yenny Wahid is an eloquent (and elegant) foe of Muslim fundamentalists.
After 9/11, many Americans assume that the radical Islamic agenda is to destroy the U.S. The reality is that attacks on Western targets are designed to function as brutal propaganda coups that will attract recruits to the cause of violent revolution. The main goal of ideologues like Osama bin Laden is to topple the governments of Muslim countries, including, most famously, the Wahabi royal regime of Saudi Arabia. But the real strategic plum, Ms. Wahid says, would be her native Indonesia and its 220 million citizens--with the largest Muslim population on earth. "We are the ultimate target," she told me in Washington during a trip to the U.S. earlier this month. "The real battle for the hearts and minds of Muslims is happening in Indonesia, not anywhere else. And that's why the world should focus on Indonesia and help."
Nancy De Wolf Smith, "Daughter of Islam: An eloquent (and elegant) foe of Muslim fundamentalists," The Wall Street Journal, February 25, 2006 ---

Iran official says U.S. behind al-Qaeda attacks
Iran’s Interior Minister accused the United States of using its infiltrators in al-Qaeda to carry out terrorist attacks that would serve its interests, government-owned newspapers in Tehran reported on Saturday. Radical Shiite cleric Mostafa Pour-Mohammadi said that Iran had “specific intelligence” proving that the U.S. had infiltrated al-Qaeda and ordered its cells to carry out terrorist attacks to convince other members of the group that they are genuine devotees. “We have specific intelligence that America has infiltrated al-Qaeda with certain individuals and has even given [its cells] the orders for terrorist strikes in order to strengthen their position”, Pour-Mohammadi told a meeting of local officials in the southern city of Kerman. He also blamed “foreigners” for being behind a spate of bombings in the south-western Iranian oil-city of Ahwaz in order to destabilise the country.
"Iran official says U.S. behind al-Qaeda attacks," Iran Focus, March 4, 2006 ---

But Wait! That's not so. Israel is behind all terrorism in the world including its secret deployment of al-Qaeda
Israel is behind all the violence in the world and is using its secret service agencies to fuel the insurgency in Iraq to direct international attention away from the Palestinian conflict, claims a senior leader of the Al Aqsa Martyrs Brigades terror organization. "The Israeli secret services are behind everything in the world, not only in Palestine or in Iraq. So one of the objectives would be to direct the attention of the world to Iraq instead of what is happening in [Israel],"

Abu Nasser, Al Aqsa's leader in the Balata refugee camp in the West Bank ---

Rahmatullah Hashemi was the Taliban's chief spokesman abroad. So how did he end up at Yale?
Why does he prefer a Jewish dining hall?

In terms of life experience, Rahmatullah is way ahead of his classmates at Yale, but he grew up fast and skipped that quintessentially collegiate phase of just hanging out and cracking jokes with friends in a dorm room
Chip Brown, "The Freshman:  Talib in Luce Hall ," The New York Times, February 26, 2006 ---

Also see

Has the anti-war movement been hijacked?
Indeed, some of the major "anti-war" groups are intimately connected with terrorist states like North Korea, as well as terrorist organizations in the Middle East. Some, like the international A.N.S.W.E.R. coalition, are closely allied with known communist organizations. One prominent group discussed in the April Whistleblower advocates that activists "physically shut down financial centers which regulate and assist the functioning of U.S. economy," engage in "large-scale urban rioting" so as to cause "massive unrest and even state of emergencies declared in major cities across the country," and "actively target U.S. military establishments within the United States … [using] any means necessary to slow down the functioning of the murdering body."
"ANTI-WAR OR ANTI-AMERICA? Exposing the violent, revolutionary leadership of today's 'peace' movement,
 Whistleblower --- 

"Black Flight The exodus to charter schools," by Katherine Kersten, The Wall Street Journal, March 2, 2006 ---

MINNEAPOLIS--Something momentous is happening here in the home of prairie populism: black flight. African-American families from the poorest neighborhoods are rapidly abandoning the district public schools, going to charter schools, and taking advantage of open enrollment at suburban public schools. Today, just around half of students who live in the city attend its district public schools.

As a result, Minneapolis schools are losing both raw numbers of students and "market share." In 1999-2000, district enrollment was about 48,000; this year, it's about 38,600. Enrollment projections predict only 33,400 in 2008. A decline in the number of families moving into the district accounts for part of the loss, as does the relocation of some minority families to inner-ring suburbs. Nevertheless, enrollments are relatively stable in the leafy, well-to-do enclave of southwest Minneapolis and the city's white ethnic northeast. But in 2003-04, black enrollment was down 7.8%, or 1,565 students. In 2004-05, black enrollment dropped another 6%.

Continued in article

Supermarkets adopt portable scanners that let shoppers total their purchases themselves --
and foil Italian elbow queens who have mastered cutting in line.

"Grocery Checkout, Italian Style," by Nicole Martinelli, Wired News, March 1, 2006 ---,70282-0.html?tw=wn_index_4

If you've ever tried to stand in line in Italy, you'll understand why self-service scanning at supermarkets has taken off.

Something in the Italian character simply refuses to stand in an orderly fashion and wait. Women in fur coats park baskets near the checkout, disappear, come back and add items, and when they are done, cut in with the banshee wail: "I am in line!" For dignity's sake, one must swiftly elbow her out and hope a carabiniere husband isn't waiting in the parking lot.

Hence the appeal of quick, orderly DIY checkouts. Self-scanners have long been called the next big thing in supermarkets, but perhaps because of the hellish line situation, Inferno-familiar Italians were quick to adopt them. A Tuscan-based chain started experimenting in 1998, and two out of three supermarkets in my neighborhood in Milan had self-scanning programs before I decided to give them a try.

Continued in article

Making your food look and act more like toys
Last week, we took a look at the wonderful ways in which technology has improved our food without making it healthier or better tasting. This week, we're doing more of the same, starting with a product that will delight people who wish their toaster waffles more closely resembled plastic toys.
Lore Sjöberg, "You Can Play With Your Food," Wired News, March 1, 2006 ---,70306-0.html?tw=wn_index_2

From The Washington Post on March 1, 2006
What year was the first television patent issued?

A. 1947
B. 1939
C. 1929
D. 1884

U.S. Is Settling Detainee's Suit in 9/11 Sweep
The federal government has agreed to pay $300,000 to settle a lawsuit brought by an Egyptian who was among dozens of Muslim men swept up in the New York area after 9/11, held for months in a federal detention center in Brooklyn and deported after being cleared of links to terrorism. The settlement, filed in federal court late yesterday, is the first the government has made in a number of lawsuits charging that noncitizens were abused and their constitutional rights violated in detentions after the terror attacks.
Nina Bernstein, "U.S. Is Settling Detainee's Suit in 9/11 Sweep," The New York Times, February 28, 2006 --- Click Here

Does this characterization of William Jennings B sound like anybody you know about today?
Yet this left-leaning Bryan had, in Hofstadter’s account, no meaningful program for change. He was merely a vessel of rage. Incapable of statesmanship, only of high-flown oratory, he was a relic of the agrarian past –- and the prototype of the fascistic demagogues who were discovering their own voices, just as Bryan’s career was reaching its end.
"Doing the Lord’s Work," by Scott McLemee, Inside Higher Ed, March 1, 2006 --- 

"The End of Tolerance: Farewell, multiculturalism. A cartoon backlash is pushing Europe to insist upon its values," Newsweek Magazine, March 6, 2006 ---

The world has long looked upon the Dutch as the very model of a modern, multicultural society. Open and liberal, the tiny seagoing nation that invented the globalized economy in the 1600s prided itself on a history of taking in all comers, be they Indonesian or Turkish, African or Chinese.

How different things look today. Dutch borders have been virtually shut. New immigration is down to a trickle. The great cosmopolitan port city of Rotterdam just published a code of conduct requiring Dutch be spoken in public. Parliament recently legislated a countrywide ban on wearing the burqa in public. And listen to a prominent Dutch establishment figure describe the new Dutch Way with immigrants. "We demand a new social contract," says Jan Wolter Wabeke, High Court Judge in The Hague. "We no longer accept that people don't learn our language, we require that they send their daughters to school, and we demand they stop bringing in young brides from the desert and locking them up in third-floor apartments."

What's going on here? Weren't the Dutch supposed to be the nicest people on earth, the most tolerant nation in Europe, a melting pot for minorities and immigrants since the Renaissance? No longer, and in this the Dutch are once again at the forefront of changes in Europe. This time, the Dutch model for Europe is one of multiculturalism besieged, if not plain defunct.

This helps explain Europe's unusually robust reaction to the cartoon crisis, which continued last week with riots in Nigeria and Pakistan that have left over 100 dead. There were apologies, to be sure, for causing offense after a small Danish paper published a dozen cartoons of the Prophet Muhammad. But on one point European leaders were united and bluntly clear: they would not tolerate any limits on European newspapers' rights to publish. "Freedom of speech is not up for negotiation," declared Commission President Jose Manuel Barroso, summing up a consensus that has only grown stronger as the cries of outrage from the Muslim world grow louder.

Continued in article

More Americans abducted along Mexico border than in Iraq
LAREDO, Texas – This border area is one of the least publicized international crisis zones. More Americans have been kidnapped just in this area than in all of Iraq by Islamic terrorists. Twenty-six Americans are now officially listed as missing in the Laredo-Nuevo Laredo region of the U.S.-Mexico border—in addition to the more than 400 Mexicans reported to be suffering a similar fate. The number of American civilians missing or kidnapped in Iraq since the beginning of the war is 23 as of last September, the latest figure released by the State Department . . . “They had 176 murders in Nuevo Laredo last year, and none of them have been solved. In the first less than six weeks of this year, there were another 27 murders. Again, none solved. At the rate they are going, the death toll will be over 300 by year’s end.” If anything, Mr. Flores said, the cartels have become more brazen, more willing to reach for their guns.
Maxim Kniazkov, "More Americans abducted along Mexico border than in Iraq," Insight Magazine, February 27, 2006 --- 

Writing Center Resources from Princeton University ---

Writing Center Resources from Purdue University  ---

Bob Jensen's writing resource bookmarks ---

How dangerous is now owned by Rupert Murdoch's News Corp.?

"Scenes From the MySpace Backlash," by Kevin Poulsen, Wired News, February 27, 2006 ---,70254-0.html?tw=wn_index_1

Meanwhile, schools are racing to block the site at the campus firewall. "Some argue that it's educationally valid, others say they're seeing kids beat up over it," says David Trask, a junior high teacher and technology director at Vassalboro Community School in Maine. "In my view, it doesn't have much (educational) value."

MySpace's rapid transformation into the largest community of teens and twenty-somethings in history made a backlash perhaps inevitable. In the three years since its launch, MySpace has gathered over 57 million registered users (counting some duplicates and fake profiles). As of last November, it enjoyed a 752-percent growth in web traffic over one year, according to Nielsen//NetRatings.

In July the site was purchased for $580 million by Rupert Murdoch's News Corp., and late last year launched its own record label in partnership with Interscope Records.

Concerns over the site fall generally into two categories: unease over the type of content teens are posting, and fear of the type of people they're meeting.

MySpace CEO Chris DeWolf says to his knowledge the backlash hasn't caused any advertisers to drop their support of the site. "We get phone calls from time to time, but when we describe the safety measure that we've put into place generally the advertisers are relieved and feel good about what we're doing."

Continued in article

"A MySpace Cheat Sheet for Parents," by Kevin Poulsen, Wired News, February 27, 2006 ---,70287-0.html?tw=wn_index_2

Can I search MySpace to see if my kid is on it?

I did it anyway. Should I be worried that my teenage girl is linked to so many male "friends?"

What if she's linking to adult men? That can't be good.

How should I talk to them about MySpace?

What is MySpace doing to protect its users?

Travelers Insurance company says hybrid-vehicle owners tend to be safer drivers, so they'll get a discount on their auto insurance, Wired Blog, February 27, 2006 ---

From the Scout Report on February 14, 2006

Camino 1.0 

With a host of helpful features, Camino 1.0 will be a most welcome addition for Mac users everywhere. The interface for the browser is quite elegant, and gives users the ability to pause and resume downloads, along with enhanced security, and tabbed browsing. This version is compatible with computers running Mac OS X 10.2. [KMG]


Many users may have dozens, if not hundreds, of bookmarks located within their favorite browsers. It can be time-consuming and quite tedious to check their validity, and this is where this application can step in to help with this process. Link200 will go through bookmarks in Firefox, Internet Explorer, and Netscape and remove those that are no longer valid. This version is compatible with all computers running Windows 98 and newer.[KMG]

Consumers Beware of Unsuspected Automatic Billings

From The Wall Street Journal Accounting Weekly Review of February 24, 2006

TITLE: Automated Payments Pose Growing Problem
REPORTER: Carol Hymowitz and Elizabeth Bernstein
DATE: Feb 22, 2006
TOPICS: Accounting, Banking

SUMMARY: The article describes issues consumers face in stopping automatic payment arrangements. "...Consumers don't always know and follow the rules for recurring payments, and banks say they aren't able to cancel recurring credit-card charges when a consumer has signed a long-term contract with a merchant..." In addition, consumers must devote significant time to resolving issues. Accounting topics arise because the article uses the terms debit and credit; questions ask students to understand the use of these terms in banking transactions.

1.) The article differentiates between debit card or bank account transactions and credit card transactions. What is the difference between a debit card and a credit card? How is a debit card similar to a checking account?

2.) What are the issues in resolving payment disputes on automated payment plans? Why do the issues differ between debit cards or bank accounts used for automated payments and automated charges to credit cards?

3.) The article uses the terms credit and debit in the title and other places, such as the statement that "Nancy Burleson's checking account was debited an extra week's mortgage payment..." Do these uses of the terms debit and credit correspond to the use of those terms in the balance sheet equation? Support your answer.

4.) Refer again to the statement quoted in question 3 about debiting a checking account. Describe how a customer checking account is classified on a bank's balance sheet, including a definition of the term "demand deposit." Explain how a demand deposit account is increased (with a debit or a credit?) and decreased (again, with a debit or a credit?).

5.) How is a customer credit card account balance (say, on a MasterCard or Visa account) classified in a bank's balance sheet? Explain how the account balance is increased (with a debit or a credit?) and decreased (again, with a debit or a credit?)

Reviewed By: Judy Beckman, University of Rhode Island

Bob Jensen's threads on banking frauds are at

Bob Jensen's threads on credit card company scams are at

Finally cancer deaths are on the decline
It didn't attract a lot of media fanfare, but two weeks ago the National Center for Health Statistics announced some spectacular news. The number of Americans dying from cancer fell for the first time in decades. This achievement against one of mankind's most dreaded diseases is the medical equivalent of putting a man on the moon. Just a few years ago health officials warned of an epidemic of U.S. cancer deaths. One and a half million Americans will be diagnosed with the disease this year. And with a toll of half a million deaths a year, cancer is still one of the leading killers in America -- partly because death rates from infectious diseases have fallen precipitously over the past century. But the National Cancer Institute rightly hails the new data as "powerful evidence" that "we are on the right track to eliminating the death and suffering due to cancer."
"Cancer Prognosis," The Wall Street Journal, February 23, 2006; Page A16 ---

Where are all the open-source companies headed?
That Oracle, a company that has shown little support for open-source software projects, has developed an appetite for open-source acquisitions illustrates how much the worlds of commercial and open-source software are colliding. IBM has proven open source can thrive with the help of a large commercial developer, and now it's pushing its open-source strategy further. The experiences of Sun Microsystems and CA show how complicated the balance can get . . . Many in the open-source community view big-business encroachment with trepidation; they worry that Oracle, for example, is more out to kill a competitor than build a bridge. Yet others note there's only so much that any heavyweight can dictate in the open-source world. "The software stack and the communities around it, you can't buy those," says Scott Kveton, a director at Oregon State's Open Source Lab. If big vendors think they're buying customers with such deals, they're throwing money in the wrong direction. "That's the old school mentality of 'we're going to dictate where our customers go,'" Kveton says. "... This is 'watch where your community is going, and get there.'"
Charles Babcock, "It's Open Season," Information Week, February 20, 2006, pp. 24-26 --- Click Here

Witches May Overtake Science
K-12 science achievement has stagnated, according to the National Science Board’s “Science and Engineering Indicators, 2006″ report, issued Thursday. Witches, however, staged a big comeback in the ’90s before slipping a few notches.According to a section of the report on pseudoscience, only around 14 percent of Americans believed in witches in 1990, according to a Gallup poll. Witches rallied for a decade, convincing over a quarter of Americans of their existence by 2001, before about 4 percent of those reneged, putting the believers at just over 20 percent in 2005.
David Epstein, "American Ignorance," Inside Higher Ed, February 24, 2006 ---

All sparrows are not alike
The bird world has many resplendent creatures that are easy to spot. The appeal of sparrows is quite different. Most of them look alike, and only ace birdwatchers can tell one species from another . . . Depending on how you count them, there are at least 60 species of sparrows in the U.S. and Canada, according to the University of Toronto's James Rising, who has co-written two books on sparrows. Some, like the Spotted Towhee -- with its black head, white belly, rusty flanks and spotted mantle -- are distinctive. Many others, like the Song Sparrow or Savannah Sparrow, can be told apart only by such clues as tiny facial markings, the length of their tails and their flight patterns. What about the sparrows commonly seen hopping around city streets? They are usually House Sparrows, and to hard-core birders, they don't count. That is because the House Sparrow was brought over from Europe, and although it resembles North American sparrows, it isn't closely related.
Neil Templen, "Birdwatchers Find Sparrows Often Are A Tough Nut to Crack," The Wall Street Journal, February 26, 2006, Page A1 ---

All Domestic Partners are Not Alike

February 23, 2006 message (with respect to the marriage tax on people over 60)
from Scott Bonacker [cpas-l@BONACKER.US]

If "living together" is an euphemism for extra-marital sex, it is maybe more of an example of the utilitarianism of Western morality. I doubt that the traditional definition of sin has been changed, just the way that society reacts to it.

However, if "living together" simply means sharing a residence and combining resources, like roomies, then morality probably isn't even an issue. Male/female co-housing has been acceptable for 30-40 years at least hasn't it? When was Three's Company on TV?

Someone else can ask, though. I'm not going to.


February 23, 2006 reply from Bob Jensen

Hi Scott,

Actually this is not a joking matter when it comes to employer benefits put into place largely for gay and lesbian couples.

Some jurisdictions require that there be a sexual relationship (actually worded as a "non-platonic relationship"). This is intended to prevent benefits "selling." For example, a single professor with great a great medical benefits package might otherwise "sell" his/her "domestic partnering benefits" to a tenant in great need of expensive medical care or perhaps even give the domestic partnering benefits to his/her live-in relative.

The following was a Tidbit on January 27, 2006 --- 

Domestic partners must have sex to get benefits
A requirement within a new domestic partner benefit plan at the University of Florida — that participants “have been in a non-platonic relationship for the proceeding 12 months” — has left many employees feeling like the university was getting a little too personal. Administrators have taken notice and said that the policy will be changed within the next two weeks.
Rob Capriccioso, "Too Much Information on Sex at Florida," Inside Higher Ed, January 24, 2006 ---

Olympic Halls of Fame ---
Type "Hall of Fame" in the exact phrase box and the name of a country in the upper search box.

Pro Football Hall of Fame ---

Basketball Hall of Fame ---

Women's Basketball Hall of Fame (with audio) ---

National Baseball Hall of Fame and Museum ---

National Soccer Hall of Fame ---

National Museum of Racing Hall of Fame ---

Country Music Hall of Fame ---

Rock and Roll Hall of Fame ---

Accounting Hall of Fame (International) ---

European Accounting Hall of Fame ---

Hall of Fame Jokes ---

The best books about doctors and patients

"Saw Bones," by Jerome Groopman, M.D., The Wall Street Journal, February 25, 2006 ---

1. "The Death of Ivan Ilyich" by Leo Tolstoy (1886).

With fine brush strokes, Tolstoy paints the portrait of an ambitious and upwardly mobile magistrate, Ivan Ilyich, who suddenly comes down with a mysterious malady. The restrained prose works to amplify a chilling message: Severe illness strips away life's façade and forces us to examine our inner core. Ilyich, at the cusp of death, realizes that he has squandered his life by pursuing what is insubstantial. But Tolstoy affirms that while there may no longer be hope for the body, there is, until the last breath, hope for the soul. It is a lesson best learned while still healthy.

2. "The Cunning Man" by Robertson Davies (Viking, 1994).

The Canadian writer Robertson Davies, who died in 1995, is not widely read in the U.S., and that's a shame. He's a master at capturing the multiple facets of character. In this novel, Davies delves deeply into the mind of a doctor who is keenly aware of not only the clinical problems of his patients but also their psychological needs. "Patient autonomy" has become a popular mantra in our culture, but Davies prompts us to consider that there might be times when, buffeted by illness, we need the firm, guiding hand of the expert physician. And he shows us how the placebo effect, with roots in ancient shamanism and branches that extend to today's practice, can work for the good.

3. "An Anthropologist on Mars" by Oliver Sacks (Knopf, 1995).

Neurology is (pun intended) a highly cerebral field. Detailed knowledge of the anatomy of the brain, spinal cord and peripheral nerves, and meticulous examination of the patient, lead the astute neurologist to a clinical diagnosis. While elegant cerebration may arrive at an answer, it does not necessarily bring a solution, since there is often little effective therapy for neurological disorders. Oliver Sacks is acutely attuned to this, and in these beautifully written case histories--including those of a painter who has lost the ability to see color and a man whose damaged memory leaves him living perpetually in 1968--he shows us how human beings, even in the absence of potent treatments, can find ways to surmount their debility and lead fulfilling lives.

4. "The Man Who Grew Two Breasts" by Berton Roueche(Dutton, 1995).

It should come as no surprise that Sir Arthur Conan Doyle, the creator of Sherlock Holmes, was a physician. Doctors often find themselves in the role of detectives, sifting clues, weighing evidence and melding deduction with intuition to identify the culprit--as Roueche depicted over the course of nearly 50 years as a medical writer for the New Yorker magazine. Modern medicine might rely heavily on the sophisticated technology of MRI scans and the like, but Roueche's stories of clinical enigmas, collected here and in other books, show how much doctors can surmise by asking the right questions and listening closely to the patient's responses. After numerous fruitless tests, a physician finally cracked the case of the man in the book's title by prompting him--through close questioning--to realize where he had been unwittingly exposed to female hormones (I won't spoil the mystery here). Words, and the doctor's laying on his hands, can still be the key to solving medical puzzles.

5. "The Lives of a Cell" by Lewis Thomas (Viking, 1974).

Doctors occupy a unique perch, witnesses to life's great mysteries. They are both biologists and healers, fascinated by the intricate geometry of tissues and organs while engaged in their patients' struggle to find meaning in their plight. Physicians aim for cure but more often come to compromise. The late Dr. Thomas embodies the physician-scientist who examines the organelles of the cell along with the aura of the spirit. A polymath, he draws connections between human beings and the natural world in unexpected places: how our physiology and our social behaviors are mirrored in termites and bees, wasps and ants, sea slugs and giant squids. His essays communicate a deep sense of awe, and his literary voice, like that of a physician at the bedside, brings wisdom and solace.

Dr. Groopman is the Recanati Professor at Harvard Medical School. His book on clinical decision-making will be published next year.


How Ordinary Scots in bygone days found out what was happening ---

In the centuries before there were newspapers and 24-hour news channels, the general public had to rely on street literature to find out what was going on. The most popular form of this for nearly 300 years was 'broadsides' - the tabloids of their day. Sometimes pinned up on walls in houses and ale-houses, these single sheets carried public notices, news, speeches and songs that could be read (or sung) aloud.

The National Library of Scotland's online collection of nearly 1,800 broadsides lets you see for yourself what 'the word on the street' was in Scotland between 1650 and 1910. Crime, politics, romance, emigration, humour, tragedy, royalty and superstitions - all these and more are here.

Bob Jensen's threads on history are at

Bob Jensen's threads on electronic literature are at

"SEC Shuts Down $50 Million Autosurf Ponzi Scam," by Gregg Keizer, InformationWeek, February 28, 2006 ---

The Securities and Exchange Commission has filed fraud charges against the owner of an Autosurf site who it accused of running a $50 million Ponzi scam and pocketing nearly $2 million.

Less than two weeks ago, the FBI opened an investigation into's promises of large returns on members' investments. In exchange for buying $6 units -- up to a maximum of $6,000 worth -- members were promised a 144 percent return within 12 days simply for viewing a dozen Web ads daily.

The SEC dubbed a "paid autosurf program" but said it was in reality an illegal Ponzi, a scam where income from incoming members is used to pay existing members' returns.

"The defendants falsely represented that upgraded membersSMQ-8217-SMQ earnings 'are financed not only [by] incoming member fees, but also with multiple income streams including advertising, and off-site investments,'" the SEC said in a statement issued Monday. "In fact, at least 95 percent of revenues have come from new investments in the form of membership fees from new or existing members. The other 'multiple income streams' from advertising revenues or off-site investments were either negligible or non-existent."

Johnson's scheme, said the SEC's complaint, had raised more than $50 million from over 300,000 members since mid-2005. Johnson, meanwhile, had transferred about $1.9 million from to her personal bank account, the SEC alleged.

The SEC asked the court to freeze Johnson's and's assets, as well as those of her payment providers, which included StormPay, an online payment service based in Tennessee that is under investigation by state authorities.

12dailypro essentially shut down after StormPay, which said it suspected an illegal scheme, turned off the payment spigot in late January. In less than two weeks, StormPay was hit with a denial-of-service (DoS) attack that knocked it offline for two days. The DoS attacker has not been identified.

Bob Jensen's fraud updates are at

All of your ancestors may not be alike
Advances in DNA testing are allowing people to uncover information about their genetic ancestry and find out where some of their ancestors came from. As an African American, I don't know where my African ancestors originated from. The only geographic location I can point to as my ancestral home is Tennessee. So I'm fascinated by the potential knowledge I could gain from this new generation of tests for genetic ancestry. But before I fork over more than $200 for such a test, the skeptic in me needs some answers. What can a DNA test really tell me about where I come from? How do these tests work? And can they be wrong?
Leslie O'Hanlon, "Tracing Your Ancestry DNA tests to find out your ancestry are growing in popularity. But do they really work? And are they worth it?" MIT's Technology Review, February 24, 2006 ---,312,p1.html 

March 3, 2006 message from Denmark (and it's not about cartoons)

Dear Professor Jensen,

Recently here in Denmark several companies have been added to Icelandic portfolios. For example Magasin Nord is now 83% owned by the Baugur Group. Straumur-Burdaras and B2B Holdings. I have been intrigued by the financing of these deals. I read that within the space of four years Icelandic equity fund companies raised seven billion dollars for purchasing companies and shares. It all seems bizarre and dare I say it, “fishy.” On a cursory cruise through the company web-pages I realised that the board members of all the top banks and private holdings are connected. Here is one example, the Landsbanki is chaired by the father of the chairman of Samson Holdings and connected with Avion the air and shipping company. Interestingly the father was charged with 450 cases of fraud and embezzlement in 1986 when he owned a shipping company which went bankrupt. He was not found guilty except for a book-keeping count –there was a ministerial tie-in. The son went to New York to study business –then co-founded up a brewery in St. Petersburg, Russia. That company Bravo was sold for 400 million to Heineken. These connections are intriguing. I am sure Abraham Briloff would agree. I almost feel that the Icelandic financial system is a shell-game – what is your take on these shenanigans? Is it at all possible that the Russian criminal organisations have a finger in the honeypot or is that too fanciful?



Bob Jensen's fraud updates are at

February 23, 2006 message from Glen L Gray [glen.gray@CSUN.EDU]

I was speaker at a conference where Scott (Dilbert) Adams was also a speaker. During lunch all the speakers sat together. As you can imagine most the table conversion was questions being asked of Scott. When asked why he became a cartoonist his answer was that at age 12 he wanted to be either Hugh Hefner, a supreme court judge or a cartoonist. Why? Because they all get to work in their pajamas as they work. And, since he couldn't qualify for the first two, he selected cartoonist.

A couple of years ago I was called for jury duty. One of the jury interview question was: if you had a choice who in the courtroom would you like to be? I said the judge--and I gave Scott's answer assuming no one would then want a smart a** on their jury. It didn't work.

SEC Says NetEase, Former Officers Settled Action Over Accounting
The Securities and Exchange Commission filed a settled enforcement action against Chinese online-games operator Inc. and two former officers over alleged improper accounting in 2000 and 2001. The SEC alleged that NetEase "materially overstated its revenues and understated its net loss by improperly recognizing revenue."
"SEC Says NetEase, Former Officers Settled Action Over Accounting," The Wall Street Journal, February 28, 2006; Page B11 ---

For details see

Bob Jensen's fraud updates are at

How Hollywood orchestrates publicity
The current strategies hark back to the Hollywood of the 1940s and 1950s, when studios, movie stars and the press worked hand-in-hand to create and maintain screen icons for worshipful fans. Today, the coverage of the stars has exploded. According to the Audit Bureau of Circulations, circulation of US Weekly stood at an average of 1,662,000 in the six months ending in January of this year, up 12.7% from the same period a year earlier. Circulation at Bauer Publishing's InTouch climbed 15.5% to 1,178,000, and at Star rose 12.3% to 1,460,000. The magazines are lucrative. US Weekly sells a million copies a week on the newsstand at $3.49 apiece. The magazine turns an operating profit of $50 million a year, says a person familiar with its accounts. People, which has a circulation of 3.8 million, brings in by far the most revenue and profit of any of the 154 magazines owned by Time Inc., a division of Time Warner Inc. Network TV programs like Access Hollywood, cable channels like E! Entertainment Television Inc. and Web sites have added to the coverage. All these outlets compete for photos documenting the daily lives of a small cast of celebrities. These stars, in turn, seek to control their images without appearing to, because doing so would ruin their mystique. "All those dirty little secrets in Hollywood include tipping paparazzi off and playing games with them," says New York-based public-relations professional Ken Sunshine, whose clients include corporations and stars such as Ben Affleck and Leonardo DiCaprio. He says people might find that "unethical" if they knew about it, "but unfortunately it seems to be an accepted part of the business."
Joe Hagan and Merissa Marr, "Caught in the Act! How Hollywood's bold-faced names secretly steer the celebrity news machine," The Wall Street Journal, March 4, 2006; Page A1 ---

National Institute of Justice ---

NIJ is the research, development, and evaluation agency of the U.S. Department of Justice and is dedicated to researching crime control and justice issues. NIJ provides objective, independent, evidence-based knowledge and tools to meet the challenges of crime and justice, particularly at the State and local levels. NIJ's principal authorities are derived from the Omnibus Crime Control and Safe Streets Act of 1968, as amended (see 42 USC § 3721-3723) and Title II of the Homeland Security Act of 2002.

The NIJ Director is appointed by the President and confirmed by the Senate. The NIJ Director establishes the Institute's objectives, guided by the priorities of the Office of Justice Programs, the U.S. Department of Justice, and the needs of the field. The Institute actively solicits the views of criminal justice and other professionals and researchers to inform its search for the knowledge and tools to guide policy and practice.

Fraud Updates ---
For earlier editions of New Bookmark s go to 
Archives of Tidbits: Tidbits Directory ---

Click here to search Bob Jensen's web site if you have key words to enter --- Search Site.
For example if you want to know what Jensen documents have the term "Enron" enter the phrase Jensen AND Enron. Another search engine that covers Trinity and other universities is at

International Accounting News (including the U.S.) and Double Entries ---
        Upcoming international accounting conferences ---
        Thousands of journal abstracts ---
Deloitte's International Accounting News ---
Association of International Accountants --- 
WebCPA ---
FASB ---
IASB ---
Others ---

Gerald Trite's great set of links --- 

Richard Torian's Managerial Accounting Information Center --- 


Professor Robert E. Jensen (Bob)
Jesse H. Jones Distinguished Professor of Business Administration
Trinity University, San Antonio, TX 78212-7200
Voice: 210-999-7347 Fax: 210-999-8134  Email:  


Tidbits on March 9, 2006
Bob Jensen
at Trinity University 

Fraud Updates ---
For earlier editions of New Bookmarks go to 
Archives of Tidbits: Tidbits Directory ---

Bob Jensen's various threads ---
       (Also scroll down to the table at )

Click here to search Bob Jensen's web site if you have key words to enter --- Search Site.
For example if you want to know what Jensen documents have the term "Enron" enter the phrase Jensen AND Enron. Another search engine that covers Trinity and other universities is at

Internet News (The News Show) ---

Security threats and hoaxes ---

25 Hottest Urban Legends (hoaxes) --- 
Hoax Busters --- 
Stay up on the latest and the oldest hoaxes ---

Most Popular eBusiness Sites 2006 - 2007 ---
WebbieWorld Picks ---

Bob Jensen's home page is at

Online Video
In the past I've provided links to various types of music and video available free on the Web. 
I created a page that summarizes those various links ---

"Video Guide: Securing Your Wireless Network," by Brian Krebs, The Washington Post, March 9, 2006 --- Click Here

From CBS: A Tear Jerker Video About Autism ---

Controversial video initially aired in the Arab media by Al Jazeera ---

Flash presentation of Cezanne Studio ---

Jay Leno video clips ---

David Letterman Video Clips ---

Saturday Night Live Video Clips ---

Jon Stewart's Daily Show ---

Comedy Central ---

Ordering a Pizza from Big Sister ---

Free music downloads ---

In the past I've provided links to various types of music and video available free on the Web. 
I created a page that summarizes those various links ---

From NPR
Oscar-Nominated Scores: 'Pride and Prejudice' ---

My Cup Has Overflowed --- 

My Time on Earth --- 

Chicken Bawk ---  Chicken-Bawk.wav


Photographs and Art

Metropolitan Museum of Art ---

National Gallery of Victoria ---

Pbase Galleries ---

No it's not an oxymoron
Arkansas Arts Center ---

Henri de Toulouse-Lautrec ---

From the Australian National University:  Art & Architecture mainly from the Mediterranean Basin, Japan and now India ---

Flash presentation of Cezanne Studio ---

Encyclopedia Britannica's Guide to Normandy in 1944 ---

From the University of California - Berkeley
Louise Bourgeois Exhibition ---

Lost Liners: The Golden Days of Ocean Travel ---

Sonja Mueller:  Panaramic forest (move your mouse) ---

Wiggly (gif) Photographs ---


Online Books, Poems, References, and Other Literature
In the past I've provided links to various types electronic literature available free on the Web. 
I created a page that summarizes those various links ---

Web Resources in Economics ---

Historical Information Resources ---

A Study In Scarlet by Arthur Conan Doyle (1859-1930) --- Click Here  

History: 1901 to World War II ---

dMarie Time Capsule ---

Quick Page - this button will automatically generate a Time Capsule page for you. - OR -

Advanced Page - this button will lead you through a "wizard" that allows you to select specific headlines, birthdays, songs, TV shows, toys, and books for the selected date. You can edit the information, or even add your own information to the final page!

Lewis Carroll Homepage ---

FreeNet Pages Poetry ---

Robert Frost's Lesser Known Poems --- 

The Call of the Wild  by Jack London (1876-1916) --- Click Here

History of Politics Outloud (audio) ---

Historical Atlas of the Twentieth Century ---

The Library Thing: Catalog Your Books Online ---

Fiction Press ---

Yesterday I had an opportunity to speak with Nobel Laureate Dr. Reinhard Selten, and I asked him what advice he would give to PhD students. He encourages students to be "courageous," and to resist the temptation to pursue the kinds of incremental research that lead to quick publication but lack impact and staying power.
Mark Nissen in a message forwarded by Bill McCarthy at Michigan State University
Jensen Comment
This speaks in favor of the initiative being considered at the University of Michigan to extend time-to-tenure from seven years to ten years.

Rather than love, than money, than fame, give me truth.
Henry David Thoreau (1817-1862) ---

It seems that Mr. Cheney sent the State of Texas a check for $7.00 for a hunting license.
The State returned the check, saying that no license is needed in Texas to shoot a lawyer!

Author Unknown

The only statistics you can trust are those you falsified yourself.
Winston Churchill (1874-1965) ---

The world will be in the hands of Islam over the next few years.
Mahmoud Ahmadinejad, President of Iran, Itar-Tess, March 3, 2006  ---
Jensen Comment: He's probably correct if anything's left of it.

The historian will tell your what happened. The novelist will tell you what it felt like.
E.L. Doctrow, Time Magazine, March 6, 2006, Page 6.

We're all lifted up by the community of us. Even in competition.
E.L. Doctrow, Time Magazine, March 6, 2006, Page 6.

Ending one strange political saga by starting another, the clerk of New Orleans Criminal District Court, Kimberly Williamson Butler, surrendered herself to an irate criminal court judge Friday morning after a week of ignoring court orders and arrest warrants, and then walked outside the courthouse to announce her candidacy for mayor.
Brian Thevenot, Times Picayune, March 4, 2006 --- Click Here
Jensen Comment: I suspect this is one of the reasons for calling New Orleans the "Big Easy." A criminal record is almost a prerequisite for public office in Louisiana unless you never got caught.  Released inmates have to find work somewhere. Why not work for the city or the state?

The saying 'Getting there is half the fun' became obsolete with the advent of commercial airlines.
Henry J. Tillman

I feel about airplanes the way I feel about diets. It seems to me they are wonderful things for other people to go on.
Jean Kerr

If you want to remain on this detail, get your ass over here and grab those bags.
Hillary Clinton (To an Secret Service agent who wanted to keep his hands free in case of a security threat.) --- 

The tiny Rufous hummingbird is able to recall where and when it last dined on the sweet nectar of flowers, according to new research, proving bird brains are smarter than first thought.
Yahoo News, March 7, 2006 --- Click Here
Jensen Comment
So what's the big deal. I can do the same thing.

Some Good News and Bad News About Heaven

Dual Covenant Theology: Thanks to the Cornerstone Church in San Antonio Jews Can Now Get Into Heaven
An evangelical pastor and an Orthodox rabbi, both from Texas, have apparently persuaded leading Baptist preacher Jerry Falwell that Jews can get to heaven without being converted to Christianity. Televangelist John Hagee and Rabbi Aryeh Scheinberg, whose Cornerstone Church and Rodfei Sholom congregations are based in San Antonio, told The Jerusalem Post that Falwell had adopted Hagee's innovative belief in what Christians refer to as "dual covenant" theology.

Ilan Chaim, Jerusalem Post, March 1, 2006 --- Click Here
Jensen Comment:  This news release actually ended up giving Jews temporary false hopes.

Late Breaking Good News and Bad News About Heaven

New "Scientific Evidence" allegedly "proves" that heaven truly exists
. . . a new documentary, "The Evidence for Heaven," available exclusively through WND's ShopNetDaily online store, offers scientific evidence for the afterlife.
"New scientific evidence heaven really exists:  Blockbuster DVD includes astounding back-from-dead testimonials,"  WorldDailyNet, March 2, 2006 ---
Jensen Comment
Some of us will be down where there are more barbeque events. We will, however, wave up to you folks drifting about overhead while nibbling on cold manna.

Really bad news for Jews now that it's a scientific fact that heaven does exist
Reverend Falwell denies that he ever once agreed that Jews can get into heaven

Evangelist Jerry Falwell has a beef with the Jerusalem Post after the newspaper published an article suggesting he's changed his beliefs about salvation, now thinking Jews can get to heaven without becoming Christians first. "Televangelist John Hagee and Rabbi Aryeh Scheinberg, whose Cornerstone Church and Rodfei Sholom congregations are based in San Antonio, told the Jerusalem Post that Falwell had adopted Hagee's innovative belief in what Christians refer to as 'dual covenant' theology. This creed, which runs counter to mainstream evangelism, maintains that the Jewish people have a special relationship to God through the revelation at Sinai and therefore do not need 'to go through Christ or the Cross' to get to heaven."
"Falwell: Jerusalem Post 'fabricated' story on me Newspaper claimed Christian evangelist had new tune on how Jews get to heaven," WorldDailyNet, March 1, 2006 ---

While I am a strong supporter of the State of Israel and dearly love the Jewish people and believe them to be the chosen people of God, I continue to stand on the foundational biblical principle that all people — Baptists, Methodists, Pentecostals, Jews, Muslims, etc. — must believe in the Lord Jesus Christ in order to enter heaven. Dr. Hagee called me today and said he never made these statements to the Jerusalem Post or to anyone else. He assured me that he would immediately contact the Jerusalem Post and request a correction. Before today, I had never heard of Rabbi Aryeh Scheinberg or had any communications with him. I therefore am at a total loss as to why he would make such statements about me to the Post, if in fact he did.
"A GRACIOUS CORRECTION OF THE JERUSALEM POST," Jerry Falwell Ministries, March 2, 2006 ---

Pastors John Hagee and Jerry Falwell have both denied a report in The Jerusalem Post earlier this week that they embrace the "dual covenant" theology, which holds that Jews are saved through a special relationship with God and so need not become Christians to get to heaven.
"Hagee, Falwell deny endorsing 'dual covenant'," Jerusalem Post, March 2, 2006 ---

Jensen Comment
Just goes to show you what might happen to evangelism if just anybody can pass through the Pearly Gates. Authorities are moving quickly to  Plains, Georgia to have Jimmy Carter settle this matter once and for all ---
Click Here

Seriously, one question that evangelists like Falwell and Hagee do not treat well is the afterlife fate of people who had absolutely no opportunity whatsoever to make a choice to accept the Christian belief, including tiny children who die prematurely or people in villages where no Christian missionary ever set foot into. Then there are brain-damaged mental defectives who became serial rapists, serial murderers, and Chancellor of the Third Reich.  What happens to them? God actually did not give any two people exactly the same circumstances in life. Some had no chance whatsoever to get into heaven under evangelist dogma. If God makes an exception for them then the only humans at risk are sane adults who had an opportunity to be Christian and failed the test. Gee thanks! From a long run perspective, a lot can be said for dying young or being totally insane. I think I'm beginning to sound like Woody Allen.

March 2, 2006 reply from a Jewish friend who is also an accounting professor

This little tempest isn't sitting so great with the JPost readers.  One writes (in talkback to the article for which you provide the url:
2. Explain 24 gates and 24 elders
David - Israel
03/02/2006 16:02

Falwell should read his N. Testament. Revelations where John sees 24 elders before the throne representing 12 tribes of Israel and 12 Apostles. Hmmmm, no replacement theology there. And the new J-town has 24 gates; twelve for the tribes and 12 Apostles. Hmmmmm. Sounds like God can dual anything He wants. And who said you can't meet Jesus and receive your faith in Jesus after your dead? N. Test verses make case for that. And every knee shall bow and every tongue confess. I don't know how you force someone to do that? Sorry Christians God is up to something far greater than just saving you. Far greater.

So Bob, I guess my day is still OK?

Bob Jensen's "Glimpse of Heaven" ---

To save your soul the easiest thing to do is find a squirrel (turn your speakers up)
Mississippi Squirrel Revival

If the above squirrel solution fails, put your immortal soul up for sale on eBay

"On eBay, an Atheist Puts His Own Soul On the Auction Block: The Winning Bidder Offers An Unusual Deal: Visit Churches and Critique," by Suzanne Sataline, March 9, 2006; Page A1 ---

A few weeks ago, Hemant Mehta posted an unusual item for sale on eBay: a chance to save his soul.

The DePaul University graduate student promised the winner that for each $10 of the final bid, he would attend an hour of church services. The 23-year-old Mr. Mehta is an atheist, but he says he suspected he had been missing out on something.

"Perhaps being around a group of people who will show me 'the way' could do what no one else has done before," Mr. Mehta wrote in his eBay sales pitch. "This is possibly the best chance anyone has of changing me."

Evangelists bid, eager to save a sinner. Atheists bid, hoping to keep Mr. Mehta in their fold. When the auction stopped on Feb. 3 after 41 bids, the buyer was Jim Henderson, a former evangelical minister from Seattle, whose $504 bid prevailed.

Mr. Henderson wasn't looking for a convert. He wanted Mr. Mehta to embark with him on an eccentric experiment in spiritual bridge-building.

The 58-year-old Mr. Henderson has written a book for a Random House imprint and is currently a house painter. He runs, a Web site whose professed mission is "Helping Christians be normal." Mr. Henderson is part of a small but growing branch of the evangelical world that disagrees with the majority's conservative political agenda, and wants the religion to be more inclusive and help the disadvantaged.

Continued in article


Sign that the end-times are drawing near
New Book About How Christians Think the End is Near Because of Radio Frequency Chips

Katherine Albrecht is on a mission from God. The influential consumer advocate has written a new book warning her fellow Christians that radio frequency identification may evolve to become the "mark of the beast" -- meaning the technology is a sign that the end-times are drawing near. "My goal as a Christian (is) to sound the alarm," said Albrecht, in a conversation over tea at a high-end grocery store. Albrecht hopes her new book, The Spychips Threat: Why Christians Should Resist RFID and Electronic Surveillance, will be embraced by the millions of Americans (59 percent of them, according to a 2002 Time/CNN poll) who share her belief that the Book of Revelation in the Bible forecasts events that are yet to come.
Mark Baard, "RFID: Sign of the (End) Times?" Wired News, March 2, 2006 ---,70308-0.html?tw=wn_index_1

"The Da Vinci Hoax:  A Tour de Distortion," Charles Colson, Break Point, March 7, 2006 --- Click Here

G. K. Chesterton famously said something to this effect: When people stop believing in God, they don’t believe in nothing—they believe in anything. A good example of this is Umberto Eco’s novel Foucault’s Pendulum, in which a group of friends program a computer to “write” a book about secret hidden knowledge. Titled The Plan, the book is the result of random links between things like Kabbalah, Rosicrucianism, the Knights Templar, and other crackpot ideas. While The Plan was intended as a prank, other people take it seriously, with tragic results.

Well, Foucault’s Pendulum shows us how gullible unbelieving people are. And this is particularly so in our postmodern age when truth doesn’t matter. This phenomenon partly explains the remarkable success of The Da Vinci Code. Like Eco’s novel, it’s about a heretofore hidden knowledge that promises to let us in on the “true” history of Christianity.

Author Dan Brown gives us a Jesus who neither died on the cross nor rose from the dead. Instead, He married Mary Magdalene and had children by her. This “sacred blood line” is the treasure safeguarded by groups like the Knights Templar and the Masons. And the Catholic Church, in a desperate attempt to cover up this secret, murders those who threaten to expose it.

Devotees of The Da Vinci Code—like the fictional fans in Foucault’s Pendulum—have trouble distinguishing fact from fiction. They visit places mentioned in the novel, and “Da Vinci Tours” are a booming business. With the upcoming film, interest in The Da Vinci Code will explode. Christians need to seize this teaching opportunity, preparing ourselves to answer questions readers are asking.

The first is: Are the historical events portrayed in Brown’s story true? Brown claims to have done extensive historical research and gives his readers no reason to doubt the novel’s accuracy. Since the average person knows almost nothing about Christian history, they’re vulnerable. For example, when Brown says that Knights Templar were put to death by the Catholic Church because they knew the “true story” about Jesus, people have no basis to question it, never having heard of the Knights Templar. Or when Brown says that at the Council of Nicea, the Vatican consolidated its power, most people are unaware that the Vatican didn’t even exist in A.D. 325.

It is our job to expose the falsehoods. We can learn to answer Brown’s lies with the truth by reading books like Darrell Bock’s Breaking the Da Vinci Code and Erwin Lutzer’s The Da Vinci Deception.

People flock to stories like The Da Vinci Code in part because all humans are searching for the secret knowledge that answers the mysteries of life. And when The Da Vinci Code debuts in May, millions more Americans will get a condensed tour de distortion. Knowing our neighbors will see this film, churches ought to begin to get ready now—preparing to answer questions about it and to tell our neighbors that there is no secret knowledge about God. It’s all in the Bible and all true.

The good news is that The Da Vinci Code readers and viewers are seeking answers to the central questions of life. The challenge is for us to supply the true answers.

Controversial Jesus-Pig Cartoon at the University of Saskatchewan
A newspaper cartoon targeting religion has once again sprung into the spotlight -- this time in a two-frame jab at Christianity in the University of Saskatchewan student newspaper, the Sheaf. The newspaper is issuing a mea culpa after a cartoon depicting Jesus performing a sex act on a capitalist pig was published in Thursday's edition of the Sheaf.
"Cartoon spurs anger U of S student newspaper apologizes for 'mistake'," The StarPhoenix, March 7, 2006 --- Click Here

Muslims may "give their souls" by signing up at the Iranian martyrdom suicide site
The Iranian reformist Internet daily Rooz reported on March 2, 2006 that "the Iranian martyrdom-seeking [i.e. suicide] forces have launched a website,  , called 'To Die as a Martyr,' [1] and have declared an alert among the Iranian martyrdom-seeking forces." The following are excerpts from the Rooz report: [2] "Thousands of Young Martyrdom-Seeking Iranians are Counting the Minutes Until They Can Give Their Souls"
"Iran's Martyr Recruitment Website," FrontPageMagazine, March 8, 2006 ---
Jensen Comment
I cannot get the site to work. It could be that Iran has either moved the site or shut it down due to its discovery by the Western media. Or it could be an elaborate hoax.

What's the surest way to stop repeat offenders from more purse snatching?

"Chinese city will execute purse thieves," The London Times, March 5, 2006 ---

Free Citizen Information Center ---
This site has a lot of consumer information and steers you through government bureaucracy.

From the Federal Trade Commission
American's Top 10 Dot Cons ---

Link to Internet Auctions Link to International Modem Dialing
Link to Internet Access Services Link to Credit Card Fraud
Link to Web Cramming Link to Multilevel Marketing/Pyramids
Link to Travel and Vacation Link to Business Opporunities
Link to Investments Link to Health Care Products and Services

Bob Jensen's threads on consumer and credit card frauds are at


A Surprising Clue to Parkinson's
Existing research already suggests that the biggest clumps, known as inclusions, are helpful. Cells that form clumps of the mutant Huntington protein, for example, survive longer than clump-free cells. Now MIT scientists have discovered a compound that increases clumps in cell models of Huntington's and Parkinson's disease and makes the cells healthier. Scientists aren't sure how the compound works, but they think it might be helping cells get rid of toxic forms of the proteins floating around in the cell by isolating them into clumps.
Emily Singer, "A Surprising Clue to Parkinson's:  Drugs that boost the protein clumping that occurs during neurodegenerative disease could provide a new route to treatment," MIT's Technology Review, March 7, 2006 ---,259,p1.html

U.N. Report: Jews are Terrorists, Not Palestinians
Jewish settlers are terrorizing Palestinians with impunity, attacking children on their way to school and destroying farmers' trees and crops, a U.N. expert on the Israeli-Palestinian conflict said in a report. John Dugard, a South African lawyer, called the withdrawal of Israeli troops and settlers from the Gaza Strip last summer a positive step. But the Jewish state effectively controls Gaza through targeted killings and sonic booms from warplanes flying over the region, Dugard said in a report prepared ahead of next week's annual meeting of the 53-member U.N. Human Rights Commission.
"U.N. Report: Jews are Terrorists, Not Palestinians," NewsMax, March 8, 2006 ---

Sigh! When I think of all those "spring breaks" I spent studying in the library in my college days (no kidding)
The American Medical Association is warning girls not to go wild during spring break. All but confirming what goes on in those "Girls Gone Wild" videos, 83 percent of college women and graduates surveyed by the AMA said spring break involves heavier-than-usual drinking, and 74 percent said the break results in increased sexual activity. The women's answers were based both on firsthand experience and the experiences of friends and acquaintances.
"Girls Gone Wild? Spring Breakers Admit More Sex, Drinking AMA Warns Women Of Health Risks," ClickOnDetroit, March 8, 2006 ---

In “The Pill,” a record banned by many radio stations in its day, she (Loretta Lynn) captured perfectly the power of birth control to let women love without the passion-dowsing fear of pregnancy: “The feelin’ good comes easy now since I’ve got the pill!”
Loretta Lynn Home Page ---
Jensen Comment
Don't take this as a commentary against birth control. I'm all for birth control and abortion rights. I'm not in favor of promiscuous and drunken spring breaks. I applaud my students who will be in the Trinity University Library next week.

Do you want to Captivate for your students?

March 6, 2006 message from Tamara Rabinovich [TRabinovich@BENTLEY.EDU]

Snagit is super for creating still images, which allows you, in particular, capturing different areas of your computer screen. Camtasia is a great product for producing videos. Captivate is even a better Macromedia (currently Adobe) product to quickly create great educational videos. Try it and you will love it.

Tamara Rabinovich
Research and Learning Technologies Consultant
Bentley College
Academic Technology Center
168 Adamian Academic Center
175 Forest St. Waltham, MA 02452

March 6, 2006 reply from Bob Jensen

Hi Tamara,

Thank you for the information about Captivate.

One thing I like about Snagit is that it will capture a paused video image in a paused media player such as the Windows Media Player. Paintshop Pro's capture utility will not capture such a video image.

One thing I don't like about Camtasia is that it will not capture a video/audio clip in a media player. Will Captivate let you save clips of video along with the audio running in a Media Player on your computer screen?

Bob Jensen

March 7, 2006 reply from

Hi Bob,

Neither Camtasia nor Captivate is meant to be used to capture a streaming video file (video and audio). In Captivate you can import video into your program; it gets converted to .swf I believe (uses a flash wrapper). Whether the embedded video is editable after you do this - I'm not sure. Or you can put in a link that will allow streaming video to be played in the captivate program from a server. Since Captivate actually is capturing single slides, it may be possible to capture a streaming file but it would probably be jerky. Never thought of doing this.

The newest version of Camtasia, however, WILL let you capture embedded video, including the audio. My colleague experimented with this today and it was a success.



Bob Jensen's threads on video are at

Sine if Bob Jensen's Camtasia videos are listed at

Fraud at Harvard
In a legal settlement reached last summer, Harvard agreed to pay $26.5 million

Did fraud by a Harvard professor ultimately sink its President Summers?

"Did an Exposé Help Sink Harvard's President?" by Sara Ivry, The New York Times, February 27, 2006 ---

"I was surprised that he was gone by February of '06," said Mr. McClintick, and "that it happened as rapidly as it did."

"How Harvard Lost Russia" was published in the January issue of Institutional Investor magazine, a subscription-only publication, about a month and a half before Dr. Summers's resignation, which he announced last Tuesday. The move came just two weeks after a Feb. 7 meeting when the president was challenged on several issues, including his reaction to events described in Mr. McClintick's article.

In roughly 18,500 words, (22,007 including sidebars), Mr. McClintick chronicled financial improprieties by those in charge of Harvard's Russia project, including Andrei Shleifer, a professor of economics who is a friend and protégé of Dr. Summers's, and Jonathan Hay, a Harvard-trained lawyer. The two men were accused of making personal investments in Russia at a time when they were working under contract to establish capitalism in the former Soviet nation.

Their behavior led the United States government to file civil charges against Harvard, Mr. Shleifer and Mr. Hay for fraud, breach of contract and making false claims. In a settlement reached last summer, Harvard agreed to pay $26.5 million. Mr. Hay was ordered to pay a fine based on his future earnings and Mr. Shleifer agreed to pay $2 million, though none of the parties admitted wrongdoing. Mr. Shleifer has not been subjected to any disciplinary action from Harvard.

Some Harvard watchers attribute that to Dr. Summers's influence, though he formally recused himself from the matter, and they see the entire affair, assiduously detailed by Mr. McClintick, as an indelible stain on Harvard's reputation.

Mr. McClintick, 65, a 1962 graduate of Harvard, is a former reporter for The Wall Street Journal and the author of several books, including "Indecent Exposure," which investigated financial scandal at Columbia Pictures. That book was a finalist for the National Book Award and helped solidify Mr. McClintick's reputation as a meticulous investigator.

Continued in article

Update on March 8, 2006|
Harvard University's faculty-ethics board is investigating Andrei Shleifer, a star in its economics department star who was caught up along with the school in a scandal that involved investing in Russia, according to a person familiar with the matter. Prof. Shleifer and Harvard last year paid nearly $30 million to settle a civil suit brought by the U.S. government alleging that Prof. Shleifer violated federal conflict-of-interest rules by investing in Russia. The case dates back a decade when Mr. Shleifer headed a U.S.-government-funded Harvard project to help Russia develop financial markets
John Hechinger, "Harvard Investigates Conduct Of a Star Economics Professor," The Wall Street Journal, March 8, 2006; Page A6

Bob Jensen's threads on the Harvard fracture are at

Bob Jensen's updates on fraud are at

What about your secret, hush-hush, Bankruptcy Risk Score that you don't even know about?

Thanks to new laws, you can find out your FICO credit score. But lenders are increasingly using a secret credit score on you that is their secret alone.
While most people are aware that their credit score can have a large impact on their financial lives, there is another score that the credit bureaus keep that most people are not aware of - your Bankruptcy Risk Score Your credit score is made up mostly of your history of obtaining credit and paying off debt. This score helps determine what type of interest rate you receive on credit cards or loans that you apply for. Most people assume that it is this score alone is used by the financial institutions considering whether or not to give you a loan. The truth is that a bankruptcy risk score is now being used more and more when lending institutions are looking at a person's credit history. The bankruptcy risk score has been around for about 20 years, but has been kept fairly hush - hush. It measures how likely a person is to file bankruptcy and uses information that makes it more specific than a credit risk score. The bankruptcy risk score is exclusively for lenders provided by the credit reporting agencies. This bankruptcy score is supposedly a complex mix of your credit score plus your spending habits. The credit agencies and those that use this report (and have contributed to creating it) don't want to reveal the model because they spend a lot of time and money developing it and if they explain it, they are giving away part of it's value. Therefore little is said about this report (and why you have never likely heard of it before). You may be able to learn a bit more about it in the near future. Experian is considering making its bankruptcy risk score available to consumers. This is after they revealed a study last July which ranked the states that had consumers who were most likely to file for bankruptcy within the next year.
"Bankruptcy Risk Score - The Hidden Credit Score ," Jeffrey Administrator, February 21, 2006 ---

Bob Jensen's threads on credit ratings and FICO scores are at

The likelihood of suffering medical depression seems to be increased among smokers,
   especially those who smoke heavily, study findings suggest.
Researchers in Norway who followed a population-based group of adults for 11 years found that those who smoked were more likely than non-smokers to become depressed, and the risk climbed in tandem with the number of cigarettes smokers puffed each day. Heavy smokers -- those who burned through more than 20 cigarettes a day -- were four times more likely than people who'd never smoked to develop depression. A number of factors the researchers considered -- including physical health, exercise and stressful life events -- failed to explain the link between smoking and later depression. This suggests, they say, that smoking may directly contribute to the development of the mood disorder. For instance, nicotine may over time change brain levels of the emotion-related chemical serotonin, which appears to be reduced in people with depression, the study's lead author, Dr. Ole Klungsoyr, told Reuters Health.
Amy Norton, "Smoking tied to risk of depression," Yahoo News, March 3, 2006 ---

Updates from WebMD (Note that for some people, coffee increases heart risks)

Will the President of Case Western University encounter the same fate as Larry Summers?
The big difference is that Harvard did not suffer from deficits and red ink!

Upon taking office, he has pushed hard to attract more top students (spending too much to do so, according to faculty critics) and emphasized a commitment to undergraduate education through a program called the Seminar Approach to General Education and Scholarship, or SAGES. The program replaces many general education lecture courses that students would normally take as freshmen or sophomores with interdisciplinary seminars, all led by faculty members. Professors have mixed views on the ideas behind SAGES, but many who like the concept say that the president didn’t adequately involve them before he turned a pilot project into a full-scale, expensive commitment. The bottom line, according to professors, is that the president’s plans weren’t designed or executed well and are leaving the university drowning in red ink. In his e-mail to faculty members this week, Hundert acknowledged a need to cut $17 million to balance this year’s budget, as well as a $40 million “recurring deficit” at the university.
Scott Jaschik, "Revolt at Case Western," Inside Higher Ed, March 2, 2006 ---

For an update see

"Army 8, Yale 0," The Wall Street Journal, March 7, 2006; Page A12 ---

"Slapped by the Supremes," Inside Higher Ed, March 7, 2006 ---

ACLU views on the Supreme Court's agenda
The Court already has on its docket a series of important civil liberties cases involving abortion, free speech, the free exercise of religion, search and seizure, the right to die, military recruiting on university campuses, and disability rights.

ACLU ---

We disagree with the Court’s decision today in Rumsfeld v. FAIR. Universities should not be punished by the loss of their federal funding merely because they apply the same non-discrimination policies to the military that they apply to every other employer that seeks to recruit on campus.
ACLU ---

The American Civil Liberties Union today expressed disappointment over a Supreme Court ruling that upholds a federal law requiring colleges to allow military recruiters on campus or else lose out on federal funding. The ACLU filed a friend-of-the-court brief in the case, Rumsfeld v. FAIR, arguing that it is unconstitutional for Congress to force law schools that object to discrimination against gay people to give the military access to their recruitment programs.

The following quote can be attributed to ACLU Legal Director Steven R. Shapiro.

“We disagree with the Court’s decision today in Rumsfeld v. FAIR. Universities should not be punished by the loss of their federal funding merely because they apply the same non-discrimination policies to the military that they apply to every other employer that seeks to recruit on campus.”

“At the same time, the unanimity of today’s decision strongly suggests that the Court did not think it was changing any existing constitutional rules. Certainly, nothing in today’s decision endorses the military’s ‘Don’t Ask, Don’t Tell’ policy or any other form of discrimination against gay people.”

Wasn't Warren Buffet supposed to be infallible?
How did he lose billions?
Warren Buffett, the second-richest man in America, is $1.8 billion poorer this year due to bad bets - also losing billions for his loyal following. The 75 year-old "Oracle of Omaha," considered by some as the world's greatest investor, has suffered an embarrassing 2.36 percent loss in returns on his huge Berkshire Hathaway empire in the past year. The pricey shares skidded from their peak last December of $91,200 apiece to $87,490 yesterday. That represents a drop of nearly $4.7 billion in just three months for his shareholders.
Paul Tharp, "WARREN BUFFETTED FOR $1.8B IN '05," New York Post, March 4, 2006 ---


What are some of the real benefits of research?
Academic research is often big business these days. But the Association of University Technology Managers wants the world to know that it’s about helping people, too. The group released a collection of its version of heart-warming academic research stories, in the hope that people will see it isn’t all about money or esoteric discipline specific pursuits. “This is an initiative to build a better understanding of the results of academic research,” said W. Mark Crowell, past president of AUTM and associate vice chancellor for economic development and technology transfer at the University of North Carolina at Chapel Hill. The “ Better World Reportis basically a book of short stories from the blockbuster discovery genre.
David Epstein, "Money Isn’t Everything," Inside Higher Ed, March 6, 2006 ---


A rain forest in Iowa? Give us a break
Despite an initial $10 million donation by Mr. Townsend and his Iowa Center for Health in a Loving Democracy (Child) Institute, what is now called the Environmental Project bounced around the state for years without gaining much traction, let alone financial backing. That all changed in 2003, however, when Chuck Grassley, Republican chairman of the Senate Finance Committee and a self-described "fiscal conservative," tagged a massive energy bill with a $50 million earmark to bring Mr. Townsend's dream here to Coralville, a thriving Eastern Iowa community near the University of Iowa and the Iowa 80 Truckstop (aka "The World's Largest Truckstop").
Michael Judge, "The Incredible Shrinking Rain Forest The strange odyssey of Sen. Grassley's earmark," The Wall Street Journal, March 9, 2006 ---

When half the students get A grades, how can we tell which of the A students are best?
In the cat-and-mouse maneuvering over admission to prestigious colleges and universities, thousands of high schools have simply stopped providing that information, concluding it could harm the chances of their very good, but not best, students. Canny college officials, in turn, have found a tactical way to respond. Using broad data that high schools often provide, like a distribution of grade averages for an entire senior class, they essentially recreate an applicant's class rank. The process has left them exasperated. "If we're looking at your son or daughter and you want us to know that they are among the best in their school, without a rank we don't necessarily know that," said Jim Bock, dean of admissions and financial aid at Swarthmore College.
Alan Finder, "Schools Avoid Class Ranking, Vexing Colleges," The New York Times, March 5, 2006 ---

Bob Jensen's threads on grade inflation and assessment are at

There was a rumor that natural blondes were going extinct. Actually they're just being reincarnated.
A team of American-led divers has discovered a new crustacean in the South Pacific that resembles a lobster and is covered with what looks like silky, blond fur, French researchers said Tuesday. Scientists said the animal, which they named Kiwa hirsuta, was so distinct from other species that they created a new family and genus for it. The divers found the animal in waters 7,540 feet deep at a site 900 miles south of Easter Island last year, according to Michel Segonzac of the French Institute for Sea Exploration.
"New Animal Resembling Furry Lobster Found," Yahoo News, March 7, 2006 ---

Natural blondes are going extinct. It's a published fact!
Suppose this study had actually been reported a leading accounting research journal such as The Accounting Review.
Keep in mind that leading accounting research journals do not publish replication studies.
As a result few accounting researchers conduct replication studies since they cannot be published.
The logical deduction becomes that accountants would forever think that natural blondes are going extinct.

I guess you can say that The Washington Post had a "bad hair day."
From the WSJ Opinion Journal on March 6, 2006

"Media outlets around the world, from CBS, ABC and CNN to the British tabloids" all fell for a hoax--a fake study from the World Health Organization claiming blondes are going extinct.

The Washington Post reported
(Actually I think the story was removed by The Washington Post for good reason.)

"The decline and fall of the blonde is most likely being caused by bottle blondes, who researchers believe are more attractive to men than true blondes," said CBS "Early Show" co-host Gretchen Carlson.

"There's a study from the World Health Organization--this is for real--that says that blondes are an endangered species," Charlie Gibson said on "Good Morning America," prompting Diane Sawyer to say she's "going the way of the snail darter." . . .

"We've certainly never conducted any research into the subject," WHO spokeswoman Rebecca Harding said yesterday from Geneva. "It's been impossible to find out where it came from. It just seems like it was a hoax."

The health group traced the story to an account Thursday on a German wire service, which in turn was based on a two-year-old article in the German women's magazine Allegra, which cited a WHO anthropologist. Harding could find no record of such a man working for the WHO.

Hey, if you're a journalist, we've got a great human-interest story for you: Did you hear about the blonde who invented the solar flashlight? ---

Now you see how ridiculous the accounting journal policy of not publishing replications becomes. Hopefully this published story in a leading U.S. newspaper (I mean The Washington Post that broke the Watergate scandal) the next time you read the findings in a leading accounting research journal.

Bob Jensen's threads on research replication are at

This is replication doing its job
Purdue University is investigating “extremely serious” concerns about the research of Rusi Taleyarkhan, a professor of nuclear engineering who has published articles saying that he had produced nuclear fusion in a tabletop experiment, The New York Times reported. While the research was published in Science in 2002, the findings have faced increasing skepticism because other scientists have been unable to replicate them. Taleyarkhan did not respond to inquiries from The Times about the investigation.
Inside Higher Ed, March 08, 2006 ---
The New York Times March 9 report is at 

March 7, 2006 reply from David Fordham, James Madison University [fordhadr@JMU.EDU]

Bob Jensen responded: "Do you think these hoaxes are all being planted by the Bush Administration just to embarrass the administration's media nemesis? If not, maybe Julie Nixon decided to wait until March 6, 2006 to get even."

Bob, I don't believe they are planted. i believe the media cultivates them on purpose. They graft, they propagate, they harvest, and cook and serve, because it helps readership. Your liberal quotations of media reports are examples of how sensation sells.

I think the same of the media that you think of corporate executives and independent auditors when it comes to fraudulent financial reporting. And for exactly the same reasons.

Both of these fields (public accounting and news-reporting) are assumed by the public to be operating in the best interest of the public. Both are assumed by the general public to be reporting objective facts, clearly and concisely, with minimum of bias, error, and falsehood.

Your posts on financial reporting scandals point out that in many cases, the public's assumptions are false when it comes to auditors and corporate executives. My posts point out that in many cases, the public's assumptions are false when it comes to so-called news media.

That you and I both bemoan the "increase" in this environment is much more a factor of you and I getting old than it is any real increase in the environment. Fraud and false reporting has been with us since the beginning (read the account of the Serpent in the Garden of Eden in Genesis - - even if you don't accept the Bible as factual, it makes a good point about the origins of fraud and false assertions and reporting!)

I have personal knowledge of a few inaccurate accounting reports. But I also have knowledge of some very accurate accounting reports. By contrast, I've not yet, not YET in my life, ever personally experienced a situation and then read a factual account of the experience in a news outlet that didn't have some aspect(s) incorrect, and in some cases, out and out falsehoods were injected mainly for the purposes of enhancing the "shock" appeal, the "entertainment" appeal, or some other greedy purpose of the news outlet, traceable directly to the profit motive or reputation motive or both.

If accountants had the track record of media journalists when it comes to accuracy and reliability of reporting, there'd be more CPA's in jail than Carter has pills. It is my experience that fraudulent financial reporting is not the rule but the exception, where my experience is that false news reports ARE the rule and not the exception. The public is hoodwinked, either way, but I believe the ramifications of false news reporting is the more harmful of the two, and certainly is the more ubiquitous.

Planted? I'm not sure. Cultivated, watered, and fertilized? Yep. For Sure.


March 7, 2006 reply from Bob Jensen

Hi David,


You wrote "It is my experience that fraudulent financial reporting is not the rule but the exception, where my experience is that false news reports ARE the rule and not the exception."



Increasingly, I am concerned about "stretched financial reporting" being the rule rather than the exception, especially for giant clients. In many ways Enron was guilty of stretch accounting as much as outright fraudulent reporting. I think the problem increases with the size of the client. The auditing firm can afford play hard ball with small and medium clients. Playing hard ball with a giant client is tantamount to suicide. Thus we have "stretch accounting."



Jason Williams in a recent Glass Lewis report entitled “The Hocus Pocus of Hedge Accounting” reports on 40 companies that revised their financial statements due to suspected willful violations of FAS 133. FAS 133 is a prize because companies and their auditors can always claim ignorance or error in applying such an impossibly complex standard. But Williams (a financial analyst) suggests that the violations, like your media violations, are in many cases intentional. He states: “Some companies with the blessing of their auditors have improperly applied the rules governing accounting for financial instruments and derivatives ... “ (Page 2)



The problem is simple enough. Executives either want to smooth earnings to please risk-averse investors or these executives want to pad their bonuses. As far as the auditor is concerned, there's too much fixed cost to recover and too much revenue dependence to buck a giant client (rhymes) at the local office level.

Bob Jensen

Will our economy go Fannie up?
Are auditors ever going to be really independent when clients are too huge to give up?

The auditors (this time not Arthur Andersen) failed to stand up to the management or didn't understand what was happening.
Peter J. Wallison, "$1.5 Trillion of Debt," The Wall Street Journal, March 7, 2006; Page A12 ---

The Rudman Report on Fannie Mae recites facts eerily similar to what we now know about Enron. According to the report, the CFO of Fannie misled the board (and possibly the CEO) about the financial position of the company. The CEO, head of the corporate governance committee of the powerful Business Roundtable, regularly misled Wall Street and the board, but may not have understood the accounting. The auditors (this time not Arthur Andersen) failed to stand up to the management or didn't understand what was happening. The board, primarily made up of independent directors, and the audit committee, made up entirely of independent directors, were unable to penetrate the scam and remained clueless as earnings were manipulated. In Fannie's case there was also a regulator, but the regulator did not begin to look into any problems until it had been surprised by similar wrongdoing at Fannie's smaller sibling, Freddie Mac.

What we should learn from this -- much of which occurred after the adoption of Sarbanes-Oxley -- is that a board made up primarily of independent directors, an audit committee made up entirely of independent directors, a Big Four accounting firm alerted to the dangers of accounting fraud, and a regulator that claimed to be fully on top of what was happening, could not prevent senior management from fudging the accounting and misleading the board and investors. No surprise there. Many observers were saying, both before and after the enactment of SOX, that a management determined to defraud or mislead could evade the scrutiny of all the gatekeepers.

This has important implications for the legislation now before Congress to reform the regulation of Fannie and Freddie and limit the size of their portfolios. Since dishonesty and incompetence are an unavoidable fact of life, and gatekeepers are unreliable, investors must protect themselves by diversifying their investments. But there is good reason to believe that diversification would not be available if dishonesty or incompetence at Fannie or Freddie in the future resulted in the collapse or financial incapacity of either.

Fannie and Freddie are not ordinary companies. They have almost $1.5 trillion of debt outstanding, which they borrowed to buy and carry portfolios of mortgages and mortgage-backed securities; these portfolios expose both companies to enormous interest-rate and prepayment risk. To hedge this risk, Fannie and Freddie are parties to derivatives transactions with notional values in the trillions, in which the counterparties are some of the largest financial institutions; any failure of Fannie or Freddie to meet its obligations would expose these institutions to substantial losses. Fannie and Freddie debt is also held widely by banks and other financial institutions, in some cases accounting for more than 100% of their capital; a decline in the value of that debt would seriously weaken these organizations and reduce their capacity to lend.

Finally, both companies are central to the real-estate financing market. If either of them could not function normally, that market -- amounting to almost a third of the economy -- would freeze up. As Alan Greenspan has pointed out for years, the risks inherent in the portfolios carried by Fannie and Freddie add up to huge systemic risk -- the danger that a failure at either company will spread to the economy as a whole.

So here is the key difference between Enron and either Fannie or Freddie. Dishonesty or incompetence in Enron's management hurt shareholders and employees, both of whom could have protected themselves through diversification of investments. Dishonesty or incompetence in Fannie's or Freddie's managements could throw the economy into chaos, and from that catastrophe diversification provides no shelter. Faith in boards, audit committees, auditors and even regulators has been shown to be misplaced. Sure, Congress would likely come in and bail them out -- but immediately, without extended debate, and with trillions of taxpayer dollars potentially at risk? Not a chance. And the damage in the meantime would be devastating.

As reform legislation languishes in the Senate, Congress should consider the lessons of Enron, Fannie and Freddie: Despite our best efforts, error and fraud will occur. That's why it's important to make sure -- by reducing the size of Fannie and Freddie's portfolios -- that no future management failure at either company will threaten the stability of the economy.

Mr. Wallison is a resident fellow at the American Enterprise Institute.

Bob Jensen's threads on Fannie Mae are at

Bob Jensen's threads on professionalism of auditors are at

Do you want to install SiteAdvisor or don't you know at this point in time?

"SiteAdvisor Adds Search Safety," by Brian Krebs, The Washington Post, February 28, 2006 --- Click Here

Since its inception, Security Fix has warned Microsoft Windows users to be extremely wary of clicking on Web links that arrive via instant messenger or e-mail, as these are the most common ways that malware spreads online today. But the sad truth is that for many Internet users, clicking on unfamiliar links that turn up in Google, MSN or Yahoo search results frequently expose users to security risks.

For the past few weeks I've been surfing the Web with the help of the beta version of a browser add-on called SiteAdvisor, a tool that offers users a fair amount of information about the relative safety and security of sites that show up in Internet searches. As I played around with this program, it became clear that this is a tool that not only allows users to make informed security decisions about a site before they click on a search result link, but it also holds the potential to fuel a more informed public dialogue about the often murky relationship between Fortune 500 companies and the spyware and adware industry.

But more on the Fortune 500 stuff later. SiteAdvisor is a browser add-on for Firefox or Internet Explorer that tries to interpret the relative safety of clicking on Web search results. With SiteAdvisor installed, each listing is accompanied by a small color-coded icon that indicates whether the software developers have received any reports of scammy, spammy or outright malicious activity emanating from the site.

The software gets its intel from a proprietary "spidering" technology that crawls around the Web much the same way as search engines do. The company's spiders browse sites with the equivalent of an unpatched version of IE to see if sites try to use any security exploits to install spyware or adware on a visitor's machine.

"Our attitude is, if a site gives you an exploit with an older version of IE, it's probably not one you want to visit with a newer version," said Chris Dixon, one of SiteAdvisor's co-founders.

If you use IE and try to visit any site that the program has seen using security vulnerabilites to install software, the program immediately redirects you to a SiteAdvisor page offering more information on the threat posed by the site (users can still chose to visit the site if they so wish after the initial warning). All such sites will earn a big red "X" next to their search listing, as will others that threaten to bombard suscribers with junk e-mail or have questionable relationships with third-party advertisers or shady Web sites.

Hover over the red "X" with your mouse arrow and a small window appears urging you to exercise "extreme caution" in visiting the site. If you then visit the site, a red dialogue box emerges that offers a brief description of why SiteAdvisor doesn't like it.

Continued in article

"'X' Marks the Spyware A startup offers Internet users simple warnings about a website's potential for spyware and spam," by David Talbot , MIT's Technology Review, March 1, 2006 ---,308,p1.html

Spyware has emerged as the bane of the Internet -- and finding solutions represents a growing obsession of Web users and the industry that serves them. The newest entrant in the counteroffensive launches today: Boston-based startup SiteAdvisor is releasing software that warns a user about potential spyware and spam hazards.

The spyware and malware problem is enormous. According to a recent Pew Internet & American Life Project, the computers of roughly 59 million Americans are infected with spyware. And home computer users spent around $3.5 billion in 2003-04 to fix the problems, according to a recent Consumer Reports investigation. Infected machines often slow down dramatically and begin generating error messages, and some types of spyware code can steal passwords and other personal information.

While many established software products remove known spyware, the warnings and advisories generated by SiteAdvisor are meant to keep users' computers from getting infected in the first place. So far, the company says it has collected data on two million websites. While this is a fraction of all websites, the company says those it rates make up 95 percent of all online traffic.


SiteAdvisor's Web-crawling technology checks whether sites offer programs for downloading, whether those programs carry spyware-like software, and whether entering an e-mail address in signup forms will generate spam. The company stores the accumulated knowledge in its databases, adds more information from website owners and users, and offers the warnings via a browser plug-in for Internet Explorer or Firefox.

[Click here to view samples of warnings ---,308,p1.html# ]

The SiteAdvisor home page is at

Bob Jensen's threads on network security are at

State Business Tax Climate Index Rankings by State, 2006 ---

Business Tax Climate Index ---

Fearing your student evaluations, how much time and trouble should you devote to email questions from your students?
For junior faculty members, the barrage of e-mail has brought new tension into their work lives, some say, as they struggle with how to respond. Their tenure prospects, they realize, may rest in part on student evaluations of their accessibility. The stakes are different for professors today than they were even a decade ago, said Patricia Ewick, chairwoman of the sociology department at Clark University in Massachusetts, explaining that "students are constantly asked to fill out evaluations of individual faculty." Students also frequently post their own evaluations on Web sites like  and describe their impressions of their professors on blogs.
Jonathan D. Glater, "To: Subject: Why It's All About Me," The New York Times, February 21, 2006 ---

Bob Jensen's threads on controversies over student evaluations are at

Bob Jensen's threads on the dark side of education technology ---

"Will Home Robots Ever Clean Up? Helen Greiner of iRobot talks about how the company's Roomba vacuum cleaner succeeded -- and why they don't have competitors," by Wade Roush, MIT's Technology Review, March 3, 2006 ---,309,p1.html

"The Art of Building a Robot to Love," by Henry Fountain, The New York Times, March 5, 2006 --- 

Robotic 'pack mule' displays stunning reflexes
A nimble, four-legged robot is so surefooted it can recover its balance even after being given a hefty kick. The machine, which moves like a cross between a goat and a pantomime horse, is being developed as a robotic pack mule for the US military. BigDog is described by its developers Boston Dynamics as “the most advanced quadruped robot on Earth”. The company have released a new video of the robot negotiating steep slopes, crossing rocky ground and dealing with the sharp kick. View the impressive clip here (28MB Windows media file). “Internal force sensors detect the ground variations and compensate for them,” says company president and project manager Marc Raibert. “And BigDog's active balance allows it to maintain stability when we disturb it." This active balance is maintained by four legs, each with three joints powered by actuators and a fourth "springy" joint. All the joints are controlled by an onboard PC processor.
"Robotic 'pack mule' displays stunning reflexes," New Scientist, March 3, 2006 ---
Jensen Comment
Do you suppose a Democratic Party donkey version with a controllable mouth is being developed to replace Howard Dean?

Website that allows ex-wives to dish out dirt on their exes
They form Britain's least wanted list: an online database of men that womankind has declared are to be avoided at all costs. Cads, lotharios and bedhopping chancers all take their place on a new website set up by cheated partners intent on sending out a warning to women around the world.

Jonathan Thompson, "Caution: Don't date... him:  Two-timed women have hit back with a website that dishes the dirt on their exes," The Independent, March 5, 2006 ---

On our way to having one telephone company once again. Can you guess its name?
The difference is that phone rates will not be regulated.

AT&T Corp. (read that SBC)  is planning to acquire BellSouth Corp., according to several people familiar with the negotiations who asked not to be identified because of the sensitivity of the talks. A merger of two of the four remaining Bell phone companies would represent a huge step toward recreating the monopoly that existed in the phone business before the old AT&T was broken up in 1984. The companies are expected to announce a deal as early as Monday.
Ken Belson, "AT&T Is Said to Be Near Deal for BellSouth," The New York Times, March 5, 2006 ---

Jensen Comment
I forgot my cell phone on a recent flight. It was a surprise that the pay phones in the San Antonio Airport now let you phone anywhere in the United States for $0.50 with unlimited time. I guess this is one of the positive side effects competing in the era of cell phones that eliminated most pay phone calls. But I rarely trust monopolies and am said to see these mergers being allowed by our ineffectual trust busters in Washington DC.

Is Canada's national health plan doomed?
Canada's government-run national health system, often held before Americans as a model method of delivering medical care, has been gradually falling to pieces in recent years, and last week it received what many fear will prove the knock-out blow. That blow came from Alberta where the provincial Conservative government of Premier Ralph Klein is defying federal laws intended to safeguard the system against private medical practice. Klein unveiled a plan to institute a controversial "two-tier system" in his province – meaning two levels of medical care, one run by the government and delivered without fee, the other delivered privately with a fee attached.
Ted Byfield, "The beginning of the end of socialist health care?" WorldNetDaily, March 4, 2006 ---

"Email Etiquette an Oxymoron? Perhaps Not," by Sanford Pinsker, The Irascible Professor, March 1, 2006 ---

It is no secret that technology has had its impact on teaching, but it is also no secret that there are times when the "impact" is unwelcome, if not downright unpleasant. I am referring to the habit, by now well established, in which students email their professors at the click of a mouse -- and then expect the professor to respond in a heartbeat. No request is too outlandish, as a recent article in the New York Times demonstrated: One first-year student emailed a calculus professor asking "If I should buy a binder or a subject notebook?"; another explained that she was late for Monday's class because she "was recovering from drinking too much at a wild weekend party." The war stories rattled on and on as the article explored the ways in which student e-mail have made professors not only "approachable" but also "on call" 24/7.

Untenured professors have good reason to worry if students perceive them as not responding swiftly enough -- no matter how inappropriate or downright outlandish student requests might be. After all, most students fill out evaluation forms at the end of the semester and woe to the professor who is perceived as dragging his or her heels when replying to student email. As a person who was once chided for not returning student papers promptly -- this, long before email became a fact of academic life -- I was glad that there was room on the form for the student to explain that he expected his paper returned at the end of the class in which he had turned it in. That, for him, defined "promptly," and I didn't meet his definition.

No doubt every professor who skimmed the New York Times article had an example or two drawn from personal experience. I am hardly an exception. I remember, for example, the first-year student who email me -- this, before our first meeting -- that she was a member of the field hockey team and that she would be leaving class early on a number of occasions (they were listed) and missing class altogether for away games. No doubt she thought this was thoughtful of her and only thought otherwise when I informed her that, at the college she was now attending, academic work took precedence over athletics, and that we ought to discuss the matter further in my office. I am happy to report that my reply got her thinking but unhappy to report that her "solution" to the problem was "make-up classes," ones I'd teach her privately during moments when she wasn't chasing a ball with a stick.

Ironically enough, the last email I received from a student had to do with the grade he got on a term paper (B-) that was headed “A Grave Injustice.” I resisted the opportunity to tell him that, if this was the largest 'grave injustice ' the world handed him, he was a fortunate young man indeed. Instead, I began with the formulaic, "I'm sorry you're upset but. . ." and went on to explain that it is my job to assign grades and that is what I'd done, to the best of my ability, in his case -- as my typed, half-page comments made clear. My point in relaying this exasperating tale is to remind professors not to get exasperated themselves. Volleying emails back and back is, well, unseemly, something that immature students do but that professional teachers don't.

My hunch is that the student email problem will only get worse. That's why it will, I believe, become crucial to establish an email policy -- call them guidelines, rules of etiquette, whatever you will -- and add it to course syllabi. I was hardly alone in making it clear on my syllabi that "Adults do not like to be called after 10 PM" (some prefer 7), and if I were still teaching I would add email to the mix.

Further, I would discourage students from emailing me drafts of papers not only the night before they are due, but also two or three nights before they are due. My policy, one that usually worked well, was to inform students that, under normal circumstances, I would be happy to comment on a one-page summary that included a working title, abstract, and up to three paragraphs -- if the single page document were turned in a week before the paper itself was due. "Unusual cases" (papers with grades below a C-) were dealt with on a case-by-case basis. Sometimes I would require that the paper be rewritten after an office conference, sometimes I would ask that a draft of the next paper be submitted at a mutually agreeable time.

Moreover, I think my etiquette rules would vary depending on the class. First-year students are often nervous Nellies; they want to do well but they lack confidence, sometime for good reason. My advice would be to cut them some slack, at the same time that you make it clear, in class, that some behavior is cheesy rather than classy. Because I'm something of a ham, I'd ham it up from time to time in my first-year seminar with tales, some real, some just made up, about what I called "students from hell." Everybody laughed but got the point about what not to do. If I were still teaching, I'd probably borrow the example about the student who emailed about what binder to buy.

Continued in article

Bob Jensen's threads on the dark side of education technology are at

Is your church or favorite charity violating its tax exempt status?

Among the prohibited activities, the examiners found that charities and churches had distributed printed material supporting a preferred candidate and assembled improper voter guides or candidate ratings. Religious leaders had used the pulpit to endorse or oppose a particular candidate, and some groups had shown preferential treatment to candidates by letting them speak at functions. Other charities and churches had made improper cash contributions to a candidate's political campaign. The IRS said the cases covered "the full spectrum" of political viewpoints.
"IRS Finds Charities Overstep Into Politics," SmartPros, February 28, 2006 ---

Bob Jensen's fraud updates are at

Yet another example of how to lie with statistics

"WEA 'Take the Lead' Campaign Misleads," by Marsha Richards, Evergreen Freedom Foundation, February 24, 2006 --- 

The Washington Education Association (WEA) is running radio and television ads decrying the fact that our state is 46th in the nation for class size, and 42nd in the nation for per-pupil spending. The ads, part of a campaign dubbed “Take the Lead,” are meant to generate sympathy for increased education spending.

Unfortunately, they’re misleading. And shallow.

A moment’s consideration of the facts shows us the WEA’s campaign is without substance. Consider the facts behind two of the union’s claims (which are featured in television ads this week):

1. Washington ranks 46th in the nation in class size. Rankings are interesting, but they’re meaningless without baselines. Ranking “high” or “low” doesn’t answer the real question: What is Washington’s average class size? The WEA’s own national affiliate admits that “no state-by-state actual class size information exists.”

What we do know is that our state legislature allocates funding to pay for a student/teacher ratio of 18.8 to one. And according to the Superintendent of Public Instruction, the state employs 55.7 K-12 classroom teachers for every 1,000 students, which means there is one teacher for every 18 students.

Many teachers will tell you their classes are larger than 18 or 19 students. Yet the WEA doesn’t seem interested in figuring out why this is and where current dollars are going.

Further, while class sizes are certainly important, they are only meaningful in context with the factors that matter most in student learning: quality and experience of the teacher, curriculum, school leadership, classroom discipline, and parental involvement. Some teachers can handle larger classes without difficulty; some subjects require more intensive interaction than others; some students learn with more ease than others. Class sizes should be determined by local teachers and administrators, not mandated at the state level.

2. Washington ranks 42nd in the nation in education spending. Again, rankings are interesting, but they don’t tell us much without baselines. The important questions are: How much is Washington spending per-pupil, and how much is enough?

According to the Superintendent of Public Instruction, Washington spent an average of $10,103 per K-12 student last year. That’s a lot of money. Is it enough to do the job? It’s hard to answer that question without meaningful performance audits of our K-12 schools, but it’s interesting to note that it rivals the tuition at some of our state’s elite private schools.

It is well documented that higher education spending doesn’t necessarily mean higher student achievement. Washington, D.C. spends more than any state, yet has the lowest student test scores. Utah spends less than most states, yet has some of the highest student test scores.

It costs money to provide a quality education, but how you spend that money is just as important as how much.

There is no "one size fits all" savings prescription to acquire this nest egg. You need to consider age, wealth, projected employment income and other personal factors to establish a reasonable range for what you can save before retirement.

"Getting Real About Retirement:  Why using historical stock returns to project your nest egg's growth may give you false confidence," by Alfred Rappaport, The Wall Street Journal, February 27, 2006; Page R2 ---

The final critical factor affecting the success of your retirement plan is the investment return from now until you hang up your work clothes. Many investors and financial advisors favor a simple approach to forecasting future returns, taking the average 10.4% compounded annual return for large-company U. S. stocks over the past eight decades. There are five reasons why this is a bad idea:

• The return is not inflation-adjusted.

• Future returns are likely to be lower than past returns.

• The return ignores expenses.

• The return ignores taxes.

• Most investors do not reinvest all of their dividends.

Bob Jensen's investment helpers are at

Largest crater discovered in Sahara
Researchers from Boston University have discovered the remnants of the largest crater of the Great Sahara of North Africa, which may have been formed by a meteorite impact tens of millions of years ago. Dr. Farouk El-Baz made the discovery while studying satellite images of the Western Desert of Egypt with his colleague, Dr. Eman Ghoneim, at BU's Center for Remote Sensing. The double-ringed crater – which has an outer rim surrounding an inner ring – is approximately 31 kilometers in diameter. Prior to the latest finding, the Sahara's biggest known crater, in Chad, measured just over 12 kilometers. According to El-Baz, the Center's director, the crater’s vast area suggests the location may have been hit by a meteorite the entire size of the famous Meteor (Barringer) Crater in Arizona which is 1.2 kilometers wide. El-Baz named his find “Kebira,” which means “large” in Arabic and also relates to the crater’s physical location on the northern tip of the Gilf Kebir region in southwestern Egypt. The reason why a crater this big had never been found before is something the scientists are speculating.
"Largest crater discovered in Sahara," PhysOrg, March 5, 2006 ---

Does Cleveland police logo contain image of pig?
See MSNBC, February 27, 2006 ---

"Google's Latest Bundle of Goodies Is Worth Opening," by Rob Pegoraro, The Washington Post, February 27, 2006 --- Click Here

The Pack ( ) consists of five Google programs (Google Earth, Google Desktop, the Picasa photo organizer, the Google Toolbar for Internet Explorer and the new Google Pack Screensaver), a version of Mozilla Firefox with the Google Toolbar built in, the Ad-Aware SE Personal spyware remover, a copy of Symantec's Norton AntiVirus 2005 SE that includes six months of updates and Adobe Reader 7. You can also remove any of these components or add any of four optional ingredients -- the Google Talk and Trillian instant messengers, RealPlayer and a gallery of art images to use as desktop backgrounds or screensaver images -- before beginning the download.

(The presence of so much Googleware should explain why the Mountain View, Calif., company isn't doing this just out of charity; a Google Pack user will never be far from links to Google sites and services.)

Continued in article

It's a little like encouraging burglars so security guards have more opportunities
"The job of security companies is to make the Apple platform look insecure," said Enderle. "They're now convinced that Apple is their next big revenue opportunity." According to Enderle, that's what's behind recent security alerts and warnings, first for a pair of worms -- which Apple argued weren't worms at all -- then for an unpatched vulnerability that could let attackers hijack Macs. "I'm not implying that there is collusion between security companies and hackers," said Enderle, "but security companies only make money if there are security exposures." But he did claim that there was a connection between vulnerability disclosures and exploits, that the cause of the second was actually the first.
Greg Keizer, "Analyst Dings Security Vendors For Exploiting Apple Flaws:  Rob Enderle is convinced that security companies see Apple as their next big revenue opportunity," InformationWeek, February 27, 2006 ---

Meanwhile, analyst Rob Enderle--one of the IT industry's chief pot stirrers--asserts that the security vendor community is, in effect, feeding itself with all the warnings it issues, Apple merely being the latest example. "By telling people about an exposure, you're telling someone else how to [exploit] it. I think security companies should spend more time catching criminals than telling them how to become one," the ever-provocative Enderle says. His view is, in turn, dismissed by Gartner security expert John Pescatore as so much old news. But if security vendors didn't derive at least some benefit from all the publicity surrounding vulnerabilities, they'd be far less proactive in dishing out the information, advice, and expertise every time a new one comes to light.
Tom Smith, "Apple, Security, And Disturbing Questions," InformationWeek Daily Newsletter, March 1, 2006

"Is OS X Truly Vulnerable? Only one of three recent concerns about the security of Apple's operating system is worth worrying about," by Daniel Turner, MIT's Technology Review, March 1, 2006 ---,300,p1.html

The Wall Street Journal Flashback, February 28, 1949
A nickel an hour. That's about the average wage boost industrial workers will get this spring. The administration sees an increase as necessary to keep purchasing power up, but is concerned about inflation and layoffs if pay rises too sharply.

A Quantum Encryption Breakthrough
Researchers at the University of Toronto have shown, in a study published in the February 24 issue of Physical Review Letters, that one of the present liabilities of quantum cryptography can be turned into an advantage. Using "quantum decoys," Professor Hoi-Kwong Lo and his team are increasing the distance that quantum-encrypted data can be sent over fiber-optic cable. Quantum cryptography uses particles of light called photons to create and send keys used for coding and decoding messages. A photon can transmit bits of a key by representing a 1 or 0, depending on a property called polarization. The sender of this key (physicists call her "Alice") transmits a string of randomly polarized single photons to the recipient ("Bob"), who collects each photon, one at a time.
Kate Greene, "A Quantum Encryption Breakthrough:  This new technique dupes eavesdroppers," MIT's Technology Review, March 3, 2006 ---,300,p1.html 

Practical Fuel-Cell Vehicles
The future of fuel-cell vehicles is already happening in an unlikely proving ground: forklifts used in warehouses. Several manufacturers are testing forklifts powered by a combination of fuel cells and batteries -- and finding that these hybrids perform far better than the lead-acid battery systems now typically used. In some situations, in fact, they could pay for themselves in cost savings and added productivity within two or three years. The adoption of the technology points to a promising hybrid strategy for finally making fuel cells economically practical for all sorts of vehicles. While researchers have speculated for years that hydrogen fuel cells could power clean, electric vehicles, cutting emissions and decreasing our dependence on oil, manufacturing fuel cells big enough to power a car is prohibitively expensive -- one of the main reasons they are not yet in widespread use. But by relying on batteries or ultracapacitors to deliver peak power loads, such as for acceleration, fuel cells can be sized as much as four times smaller, slashing manufacturing costs and helping to bring fuel cell-powered vehicles to market.
Kevin Bullis, "Practical Fuel-Cell Vehicles:  Hybrid vehicles operating in an unusual environment are lifting the prospects of fuel cells,"  MIT's Technology Review, March 3, 2006 ---,296,p1.html

Hawaiian Senators Block Genetic Modified Crops
State senators have advanced two bills putting limits on the genetic modification of taro and coffee, crops that are key to Hawaii's identity. The bills that passed out of a dual committee meeting Wednesday would ban until 2011 the field testing of strains of both plants that have been engineered or spliced with the genes of other organisms. The modified plants could, however, be grown in greenhouses. The taro bill also would place a five-year ban on genetically modifying Hawaiian varieties of the plant, whose roots are made into poi, one of the state's best-known foods. In Hawaiian folklore, taro is considered to be a sacred ancestor of Native Hawaiians, linking them to island soil.
"Hawaiian Bill: No GM Coffee Plantations Hawaii Senate lawmakers advance limits on genetic modification research," MIT's Technology Review, March 2, 2006 ---,323,p1.html

Who’s Afraid of David Horowitz?
You would never know it from McLemee’s article, but The Professors is not about any threat from left-wing ideas as such. It is about the intellectual corruption of the university, and the intrusion of political agendas into the academic curriculum. I know this statement will come as a surprise to those familiar only with the attacks themselves, so here is what the book actually says: “This book is not intended as a text about left-wing bias in the university and does not propose that a leftwing perspective on academic faculties is a problem in itself. Every individual, whether conservative or liberal, has a perspective and therefore a bias. Professors have every right to interpret the subjects they teach according to their individual points of view. That is the essence of academic freedom. But they also have professional obligations as teachers, whose purpose is the instruction and education of students, not to impose their biases on their students as though they were scientific facts.”
"Who’s Afraid of David Horowitz?" by David Horowitz, Inside Higher Ed, February 27, 2006 ---

Bob Jensen's threads on The Professors by David Horowitz are at

February 27, 2006 message from Rohan Chambers [rchambers@CYBERVALE.COM]

Canadian University Bans Wireless Networking, Citing Health Concerns

The president of Lakehead University, in Ontario, says that he will not allow the institution to deploy a wireless network on the campus out of concern that the electromagnetic frequencies such systems emit could endanger students' health.

The president, Frederick F. Gilbert, became concerned about the health effects of wireless networks after reading studies done by scientists for the California Public Utilities Commission, said Marla Tomlinson, a spokeswoman at Lakehead, a 7,000-student institution in Thunder Bay, Ontario. The California scientists concluded that people exposed to electromagnetic wavelengths might be at risk of developing cancer and recommended further investigation.

Continued in the article…..


February 27, 2005 reply from Robert Holmes, Glendale College [rcholmes@GLENDALE.CC.CA.US]

I am not a subscriber and was unable to read the article. Our son had leukemia in the early 1980's(he is currently OK and applying to PhD programs). The doctors did a lot of testing in our house and neighborhood for electro-magnetic waves including powerlines and electric blankets. The last I knew they determined that these waves were not a factor in causing cancers, either in our son or anyone else. I am interested in hearing about any new research. (We abandoned our electric blankets, just in case, and I still miss crawling into a warm bed.)

"How to Digitize a Million Books:  Needed: scanning software for 430 languages and a system to organize the next big leap in the information age," by Kate Greene, MIT's Technology Review, February 28, 2006 ---,300,p1.html

The Million Books Project at Carnegie Mellon University ---

As of November 2005 -

  • Over 600,000 books have been scanned: 170,000 in India, 420,000 in China, and 20,000 in Egypt. Roughly 135,000 of the books are in English; the others are in Indian, Chinese, Arabic, French, or other languages. Most of the books are in the public domain, but permission has been acquired to include over 60,000 copyrighted books (about 53,000 in English and 7,000 in Indian languages).
  • The books that have been scanned to date are not yet all available online, and no single site has copies of all the books that are available online.
  • Twenty-two scanning centers are operating in India, including four mega-centers. Eighteen centers are running in China, including a mega-center in a free-trade zone to avoid customs delays with shipments of books from the U.S.
  • The National Agriculture Library and the United Nations' Food and Agriculture Organization (FAO) have joined the project, along with academic libraries in the United States that have large agriculture collections. Agriculture has become a collection focus for the project, and plans are being developed to create a knowledge network aimed at improving rural community access to critical agricultural information.
  • Significant research is underway in the project, including OCR for Indian and Arabic languages and scripts. The research also includes developments in machine translation, automatic summarization, image processing, large-scale database management, user interface design, and strategies for acquiring copyright permission at an affordable cost. Indian partners have developed a translating and transliterating user interface. Partners in Egypt are developing an interface that supports annotation and highlighting. Partners in China have made remarkable progress on content-based image retrieval and machine analysis of calligraphic scripts. Carnegie Mellon has taken strides in machine translation and automatic summarization.
  • Transferring the books among partners is very difficult, largely because of network bandwidth. Shipping books on disks does not work well in China because of the need to make a customs declaration for every book on the disk. Other challenges include providing a flow of books commensurate with the capacity of the scanning centers and resolving issues related to copyright.
  • India, China and the U.S. agreed to join the Open Content Alliance (OCA), recently initiated by Brewster Kahle and the Internet Archive, because the goals of the OCA are consistent with those of the Million Book Project.

Google Book Search --- 

Bob Jensen's links to electronic literature --- 

Videos from Suicide Bombers
Suicide bomber videos: Footage of hate Farewell message: 'There is no blood better than the blood of Jews'

WorldNet Daily, March 2, 2006 ---

People hate Israelis for a reason
Hany Abu-Assad, Israeli-born director of Oscar-nominated film ‘Paradise Now,’
YNetNews ---

From the University of Illinois Scholarly Communication Blog on February 28, 2006 ---

Library Leaders Press Colleges to Archive Online Journals to Avoid Loss of Data

Some library leaders are urging colleges and academic libraries to take action to preserve online scholarly journals, saying they could vanish into oblivion should publishers go out of business or face other calamities. A group of librarians, college administrators, and scholars issued a public call to action on the issue in October, in a statement edited by Donald J. Waters, an official specializing in scholarly communications at the Andrew W. Mellon Foundation. The Association of College and Research Libraries endorsed the message this month. "Since most libraries do not actually own and store the content of the journals they license in electronic form, new models for preservation must be developed," association officials said in a statement. "Scholars may face serious loss of access to published research if libraries do not adopt effective electronic-journal-preservation strategies." Unlike print journals, which libraries own and can keep forever, electronic journals are provided to libraries under a kind of lease. Libraries pay for the privilege of having access to the journals online. But many libraries fear they will not be able to retrieve back issues should that access abruptly end -- if, for example, a publisher goes bankrupt. This is of special concern now that libraries are increasingly relying on electronic journals. The association says it supports allowing libraries to operate their own electronic archives or to form a collective with other libraries to preserve electronic journals. The archive would be made available to scholars only when the publisher could no longer provide access to the journals, or if the materials were no longer protected by copyright. Chronicle of Higher Education 2/24/06 .


Rare 'masterpiece' now available in English after 300 years, James Ussher's legendary 'Annals of the World' ---

Liberwocky: What Liberals Say and What They Really Mean  ---

Dutch Schools Strip Nobel Laureate's Name
Dutch universities have stripped a late Nobel chemistry laureate of honors, citing new evidence that he collaborated with the Nazis to oust Jews from academic positions. The information about Dutch-born Peter Debye, who won the Nobel in 1936, emerged a month ago in a book, "Albert Einstein in the Netherlands." The book, by Berlin-based author Sybe I. Rispens, cited letters Einstein wrote to colleagues about his suspicions of Debye when the Dutchman moved to the United States in 1940, where he lived until his death in 1966.
Aruthur Max, "Dutch Schools Strip Nobel Laureate's Name," Yahoo News, March 3, 2006 ---

William J. Clinton Presidential Center ---

If this passes, Ohio may no longer be the swing state in national elections
If a Youngstown lawmaker's proposal becomes Ohio law, Republicans would be barred from being adoptive parents. State Sen. Robert Hagan sent out e-mails to fellow lawmakers late Wednesday night, stating that he intends to ``introduce legislation in the near future that would ban households with one or more Republican voters from adopting children or acting as foster parents.''
Carl Chancellor, "Plan would bar Ohio adoptions by GOP," Beacon Journal, February 24, 2006 ---

How many U.S. households are still not online?
Nevertheless, while many of us have embraced the Web, hoping that it's making our lives easier, there's a significant number of U.S. households that are not online—39 million, according to researcher Parks Associates. Not only do these homes not have Web connections, but only 2 percent of the people living in them plan to subscribe to an Internet service this year. As a result, it appears the nation has stalled in terms of Internet penetration in the home. Now I could do a lot of hand wringing and argue for getting these people online as soon as possible, but the truth is I don't care. If these people are happy without blogs, portals, search engines and iTunes, then I say stay away.
Antone Gonsalves, InternetWeek Newsletter, February 26, 2006

From The Washington Post on March 6, 2006

What airline plans to offer XM satellite radio service on board its flights?

A. American
B. Frontier
C. JetBlue
D. United

Jensen Question
When will the airlines ever learn that what we really want for our money is a a good routing schedule, on-time arrival, and joy over the luggage service. Why should we pay for frills that don't really matter?

From the Scout Report on March 3, 2006

Two on Teaching in Community Colleges
The Center for Teaching Excellence [pdf]
Del Mar College-Teaching and Learning Center [Real Player] 

A number of colleges and universities have excellent sites dedicated to helping professors and other educators learn more about effective teaching methods. In recent years, more than a few community colleges have also adopted such techniques, creating a plethora of websites geared towards assisting educators. The first site profiled is from the Lansing Community College’s Center For Teaching Excellence. From their page, visitors can take a look through a number of useful documents, such as “Classroom Strategies for Fostering Student Retention” and “Essays on Teaching Excellence.” The site also contains their biannual newsletter, “Spotlight on Faculty”, which features a number of teaching tips and techniques developed by faculty at the college. The second site will take users to the Teaching and Learning Center at Del Mar College in Corpus Christi, Texas. Here visitors can find helpful “technology tips” designed for incorporating technology into the classroom, and a number of podcasts of interest. These podcasts deal with a number of themes, ranging from mental health crises on campus to resource challenges facing community colleges. [KMG]

National Center for the Study of Adult Learning and Literacy [pdf] 

Located at Harvard University, The National Center for the Study of Adult Learning and Literacy (NCSALL) draws on numerous scholars and experts to investigate the practice of educational programs around the country that serve adults with limited literacy and English language skills. Their various outreach efforts include disseminating their research findings through journals and policy reports, along with the leadership provided by their Connecting Practice, Policy, and Research initiative. The “Research” section of the site is a good place to start, as users can learn about their most recent research projects and also read publications authored by researchers working at NCSALL. Beyond this section, visitors will also appreciate the “Publications” area, which includes research briefs, reports, and selections from their occasional papers series. One highlight here is the “Focus on Basics” quarterly publication, which presents best practices and current research on adult learning and literacy. Visitors can view the current issue, and also scan through the archives, which date back to 1997. [KMG]

The Future of Children [pdf] --- 

There are a number of fine journals that deal with policies oriented toward children in the United States, and The Future of Children is certainly one of the best. The journal is a publication of The Woodrow Wilson School of Public and International Affairs at Princeton University and The Brookings Institution. On this site, visitors can read the current issue of the journal, and also browse their previous issues dating back to 1991. Each issue has a general theme, and past years have featured issues dealing with adoption, health insurance for children, caring for infants and toddlers, and domestic violence. For visitors who may be pressed for time, each issue contains an executive summary and article summaries. Additionally, users may also wish to sign up to receive their free e-mail newsletter. [KMG]

Craigslist Accused of Violating the Fair Housing Act Craigslist Is Accused of Bias In Housing Ads [Free Registration Required] 

Craigslist Disputes “Fair” Housing Lawsuit 

Free classified ads not working well for newspapers 

Chicago Lawyers’ Committee for Civil Rights Under Law, Inc. v. Craigslist, Inc. [pdf] 

Stanford Law Review: In Search of Fair Housing In Cyberspace: The Implications of the Communications Decency Act for Fair Housing on the Internet [Word] 

Stanford Center for Internet and Society [pdf]

"IBM's Chip-Shrinking Secret:  New tricks with light and lenses could produce the smallest microprocessors -- without revamping the industry," by Kate Greene, MIT's Technology Review, February 27, 2006 ---,295,p1.html

Langa Letter:
Another Hidden Gem: The Windows Disk Management Too
l:  Create, delete, and format partitions; change drive letter assignments and paths; help set up disk mirroring and RAID; and more--all with this free Windows tool
by Fred Langa, InformationWeek, February 27, 2006 ---

Windows' Disk Management Tool
You can access the Disk Management tool easily from any Admin-level account. Click "Start/Control Panel/Performance" and "Maintenance/Administrative Tools/Computer Management." When the Computer Management interface opens, look in the left-hand pane under "Storage" and click on "Disk Management." You should see something like what was shown earlier in screen 2, although the details for your system will, of course, be different.

Let me explain what you're seeing in the screen shot: You can see my first hard drive-Disk 0-has seven partitions and six logical drives on it. The tiny 8 Mbyte first partition is for my boot manager, a tool that also gives me access to a self-contained imaging/backup function that runs outside of, and independently of, Windows. Because this partition is outside of Windows' control, Windows shows it as an "unknown partition." If you don't use a boot manager, your display won't show this kind of partition.

My normal C: system drive is a 9 Gbyte NTFS partition, sized because it fits conveniently on two DVDs for backup. Windows and my most important data files live there. The other partitions, D through H, are formatted in FAT32, which yields slightly faster access than NTFS, albeit with a slightly greater risk of data corruption or file errors. My less important files are on these partitions, and they're backed up at less-frequent intervals than my C: drive is. Because FAT32 is marginally faster than NTFS, I've also put XP's pagefile on one of the FAT32 partitions, D. (If you're curious about why I've set things up this way, there's a complete explanation here.)

In screen 2, also note that my system's two CD/DVD drives are shown. Although our focus today is hard-drive management, the Windows Disk Management tool does give you access to these removable drives as well. This can be very handy when or if, for instance, you need or want to change the drive letter assigned to a CD or DVD drive.

Although the Disk Management tool is useful for working on already installed disks, its best and main use is in adding a new second drive to a system, or temporarily adding a second drive as part of swapping out an older drive for a newer one.

The upper left portion of screen 3 shows what you see when you open Drive Management after adding a new, raw, unformatted hard drive to a system. (For clarity, I've resized the Drive Management window to hide the CD and DVD drive information because we won't be doing anything with them right now.)

Continued in article

Related Insights

Langa Letter: Deep-Geek File And Disk Tools
A major brain-fade forces Fred Langa to search for the most powerful recovery tools he could find.

Langa Letter: A Complete PC Maintenance Checklist
Fred Langa offers a comprehensive plan for keeping your PC in absolute top-notch condition.

Langa Letter: A Must-Have Repair And Recovery Tool
If you ever have to recover files from an unbootable drive or try to bring a dead PC back to life, here's a free, zero-footprint tool you shouldn't be without, Fred Langa says.

No Pro Bono:  Mother Rented Her Daughters to Pay for Legal Services
An alert hotel clerk helped police nab a fugitive lawyer facing charges that he paid for sex with two girls with the approval of their mother. Prosecutors said Colliton had in effect been renting the teenage girls from their 38-year-old mother. The lawyer started with a 15-year-old daughter in 2000 and continued until 2004, Manhattan District Attorney Robert Morgenthau said.
"Fugitive Lawyer Arrested on Child Sex Charges," Fox News, March 4, 2006 ---

"Super Battery:  The M1 stomps all over today's cells," Wired News, March 2006 ---

Rechargeable battery industry, dominated by Asian giants like Sanyo, Sony, and Toshiba, is worth more than $6 billion a year. A123 - whose inves­tors include Motorola, Qualcomm, and the Pentagon's VC arm, OnPoint Technologies - aims to radically expand that market, by both cutting the cords on conventional plug-in tools and home appliances and powering brawny electric versions of everything from lawn mowers to military surveillance drones.

A123's real target, however, is your car. Chiang says A123's cells could lighten a Toyota Prius' 100-pound battery by as much as 80 percent and help boost any hybrid's performance. The quick recharging time - the M1 takes five minutes to reach 90 percent capacity - plus high peak power also would be ideal for plug-in versions of gas-electric vehicles. With a bit more research, the world's roads may someday see fast, zero-carbon autos that zip past gas guzzlers and tank up from the grid faster than a rest-stop Starbucks can serve you a latte.

Continued in article

Forwarded by a good friend who is retired from the Army.

Ben Stein's Last Column


How Can Someone Who Lives in Insane Luxury Be a Star in Today's World?

As I begin to write this, I "slug" it, as we writers say, which means I put a heading on top of the document to identify it. This heading is "eonlineFINAL," and it gives me a shiver to write it. I have been doing this column for so long that I cannot even recall when I started. I loved writing this column so much for so long I came to believe it would never end.

It worked well for a long time, but gradually, my changing as a person and the world's change have overtaken it. On a small scale, Morton's, while better than ever, no longer attracts as many stars as it used to. It still brings in the rich people in droves and definitely some stars. I saw Samuel L. Jackson there a few days ago, and we had a nice visit, and right before that, I saw and had a splendid talk with Warren Beatty in an elevator, in which we agreed that Splendor in the Grass was a super movie. But Morton's is not the star galaxy it once was, though it probably will be again.

Beyond that, a bigger change has happened. I no longer think Hollywood stars are terribly important. They are uniformly pleasant, friendly people, and they treat me better than I deserve to be treated. But a man or woman who makes a huge wage for memorizing lines and reciting them in front of a camera is no longer my idea of a shining star we should all look up to.

How can a man or woman who makes an eight-figure wage and lives in insane luxury really be a star in today's world, if by a "star" we mean someone bright and powerful and attractive as a role model? Real stars are not riding around in the backs of limousines or in Porsches or getting trained in yoga or Pilates and eating only raw fruit while they have Vietnamese girls do their nails.

They can be interesting, nice people, but they are not heroes to me any longer. A real star is the soldier of the 4th Infantry Division who poked his head into a hole on a farm near Tikrit, Iraq. He could have been met by a bomb or a hail of AK-47 bullets. Instead, he faced an abject Saddam Hussein and the gratitude of all of the decent people of the world.

A real star is the U.S. soldier who was sent to disarm a bomb next to a road north of Baghdad. He approached it, and the bomb went off and killed him.

A real star, the kind who haunts my memory night and day, is the U.S. soldier in Baghdad who saw a little girl playing with a piece of unexploded ordnance on a street near where he was guarding a station. He pushed her aside and threw himself on it just as it exploded. He left a family desolate in California and a little girl alive in Baghdad.

The stars who deserve media attention are not the ones who have lavish weddings on TV but the ones who patrol the streets of Mosul even after two of their buddies were murdered and their bodies battered and stripped for the sin of trying to protect Iraqis from terrorists.

We put couples with incomes of $100 million a year on the covers of our magazines. The noncoms and officers who barely scrape by on military pay but stand on guard in Afghanistan and Iraq and on ships and in submarines and near the Arctic Circle are anonymous as they live and die.

I am no longer comfortable being a part of the system that has such poor values, and I do not want to perpetuate those values by pretending that who is eating at Morton's is a big subject.

There are plenty of other stars in the American firmament...the policemen and women who go off on patrol in South Central and have no idea if they will return alive; the orderlies and paramedics who bring in people who have been in terrible accidents and prepare them for surgery; the teachers and nurses who throw their whole spirits into caring for autistic children; the kind men and women who work in hospices and in cancer wards.

Think of each and every fireman who was running up the stairs at the World Trade Center as the towers began to collapse. Now you have my idea of a real hero.

I came to realize that life lived to help others is the only one that matters. This is my highest and best use as a human. I can put it another way. Years ago, I realized I could never be as great an actor as Olivier or as good a comic as Steve Martin...or Martin Mull or Fred Willard--or as good an economist as Samuelson or Friedman or as good a writer as Fitzgerald. Or even remotely close to any of them.

But I could be a devoted father to my son, husband to my wife and, above all, a good son to the parents who had done so much for me. This came to be my main task in life. I did it moderately well with my son, pretty well with my wife and well indeed with my parents (with my sister's help). I cared for and paid attention to them in their declining years. I stayed with my father as he got sick, went into extremis and then into a coma and then entered immortality with my sister and me reading him the Psalms.

This was the only point at which my life touched the lives of the soldiers in Iraq or the firefighters in New York. I came to realize that life lived to help others is the only one that matters and that it is my duty, in return for the lavish life God has devolved upon me, to help others He has placed in my path. This is my highest and best use as a human.

By Ben Stein


Fraud Updates ---
For earlier editions of New Bookmark s go to 
Archives of Tidbits: Tidbits Directory ---

Click here to search Bob Jensen's web site if you have key words to enter --- Search Site.
For example if you want to know what Jensen documents have the term "Enron" enter the phrase Jensen AND Enron. Another search engine that covers Trinity and other universities is at

International Accounting News (including the U.S.) and Double Entries ---
        Upcoming international accounting conferences ---
        Thousands of journal abstracts ---
Deloitte's International Accounting News ---
Association of International Accountants --- 
WebCPA ---
FASB ---
IASB ---
Others ---

Gerald Trite's great set of links --- 

Richard Torian's Managerial Accounting Information Center --- 


Professor Robert E. Jensen (Bob)
Jesse H. Jones Distinguished Professor of Business Administration
Trinity University, San Antonio, TX 78212-7200
Voice: 210-999-7347 Fax: 210-999-8134  Email:  

Tidbits on March 21, 2006
Bob Jensen
at Trinity University 

Fraud Updates ---
For earlier editions of New Bookmarks go to 
Archives of Tidbits: Tidbits Directory ---

Bob Jensen's various threads ---
       (Also scroll down to the table at )

Click here to search Bob Jensen's web site if you have key words to enter --- Search Site.
For example if you want to know what Jensen documents have the term "Enron" enter the phrase Jensen AND Enron. Another search engine that covers Trinity and other universities is at

It took me less than ten seconds
I recommend that you download a patched Adobe Macromedia Flash Player now ---  Click Here

"Adobe Warns Of Critical Flash Flaw, Drive-By Downloads:  Users are urged to update immediately to the patched edition of the Flash player," by Gregg Keizer, Information Week, March 17, 2006 ---

Adobe on Tuesday warned that multiple critical vulnerabilities in its Flash media player put users at risk, possibly from drive-by downloads, and urged all to update immediately to the patched edition.

Microsoft also issued a security advisory Tuesday to tell customers of its Windows XP, Windows 98, and Windows Millennium operating systems -- all of which are bundled with a flawed edition of Flash -- to also update their players.

Security vendors quickly chimed in Wednesday. Danish vulnerability tracker Secunia, for example, labeled the threat as "highly critical," its second-highest warning rating.

Jensen Comment
Remember that Adobe bought out Macromedia, the company that developed Flash. To download a patched Flash Media Player (free), go to 
or just Click Here

Bob Jensen’s home page is at

Online Video
In the past I've provided links to various types of music and video available free on the Web. 
I created a page that summarizes those various links ---

Bob Jensen's commentary on psychiatrist Wafa Sultan and the original MEMRI-translated video can be found at
March 10, 2006 message from a friend


A friend sent me the Wafa Sultan video, MEMRI translated (link below). It read well as a transcript when you posted it, but the video is 4x more powerful. An impressive and courageous woman--worth spending 4 minutes watching. 

From NPR
A St. Patrick's Day Tale: Storyteller Eddie Lenihan ---

ZIMBABWE'S ECONOMIC TRACK --- (Al Jazeera on March 16, 2006) ---

From ABC News:  Moose Trapped in Car Seat ---

Get Easter Egged ---

Rap:  Treat Your Mother Right ---

Rental/Purchase Video Downloads from
People familiar with the situation say the online retailer is talking with movie studios including General Electric Co.'s Universal Pictures, Viacom Inc.'s Paramount and Time Warner Inc.'s Warner Bros. about making their content available on its site,
both for Internet rental and purchase. Negotiations are continuing, but a service could begin this summer. Amazon declined to comment.
"Coming Attraction: Downloadable Movies From Amazon," by Sarah McBride and Mylene Mangalindan, The Wall Street Journal,  March 10, 2006; Page B1 --- Click Here

Free music downloads ---

In the past I've provided links to various types of music and video available free on the Web. 
I created a page that summarizes those various links ---

Forwarded by Auntie Bev
Lost in the Fifties' Harbor Lights ---

From NPR
A Musical Trip to 'Grey Gardens'  ---

From NPR
Composer John Kander and lyricist Fred Ebb are the heart and soul of some of the most recognizable songs of stage and screen: "Cabaret," "All That Jazz" and of course, "New York, New York." ---

From NPR
Isobel Campbell: After Belle Comes 'Ballad' ---

From NPR
The Chieftains, Ambassadors of Celtic Folk ---

Rock From NPR
Clap Your Hands Say Yeah ---

From NPR:  Film:  Music from the Inside Out
Film Explores Orchestra Players' Calling ---

From NPR
Miles Davis, Beyond Jazz: Rock Hall Honors Davis ---


Photographs and Art

Bob Jensen's Navy Days ("luxury cruises" aboard a battleship to Cuba, Panama, and Chile) ---

I often wondered what would be best about being a frog!
Winners from NATIONAL WILDLIFE photo contest --- 

Web exhibition from the Smithsonian Institution Hirshhorn Museum ---

Photos of the Latest Tech Toys ---

Beautiful Rainbow ---

Geneva Motor Show 2006 ---

Historic Cities ---

Photo Blink ---

Photos from NPR
U.S. Baby Boomers Retiring in Panama, Part 2 ---

Photographs of Google Headquarters ---

Yerka Paintings ---


Online Books, Poems, References, and Other Literature
In the past I've provided links to various types electronic literature available free on the Web. 
I created a page that summarizes those various links ---

History of St. Patrick's Day ---

Many free classic poems by famous poets ---

Free eBooks for your PDA (or iPod) ---

Free PDF eBooks Archive ---

Internet Library of Early Journals ---

Watch And Ward by Henry James (1843-1916) --- Click Here

The Altar of the Dead by Henry James (1843-1916) --- Click Here 

Daisy Miller by Henry James (1843-1916) --- Click Here

From Cornell University
Alice Fulton Poems ---

3,000 Years of World History ---

Historic Cities ---

Historical Text Archive ---

Yahoo Groups Economics Collections ---

American Library Association ---

Online History Books ---

B stands for bull's-eye.
President Bush noted that the vice president's full name is Richard B. Cheney, Fort Worth Star Telegram, March 13, 2006 --- Click Here

Baseball doesn't owe me a thing. I owe my whole life to baseball.
Kirby Puckett, Minnesota Twins

When I came up, you couldn't play if you couldn't bunt, but home runs have pretty much taken over the game today. You have to hit at least 25 homers to be a hero today. The game has changed so much. People want to see homers. Look around the league. Bunting has become a lost art. The baseball purists appreciate and respect Tony Gwynn and "Boggsie", but your batting average doesn't matter as much anymore. They want people who can put the ball over the fence.
Kirby Puckett, Minnesota Twins

I took care of him in many ways, but he took care of me in so many ways. I demanded almost as much of our relationship after his disability as before—basically telling him: ‘You need to be my husband. I am there to support you; you need to support me.’ I think it kept our relationship alive. Because if I had given up and said, ‘Oh, you’re sick. I’m not going to ever ask anything of you,’ it would’ve belittled him. He was a willing and loving participant in our relationship, and he was an incredible husband because of that.”
Dana Reeve ---

We have become accustomed to living our life with joy amidst pain and challenges.
Dana Reeve ---

There is one way to find out if a man is honest; ask him! If he says yes you know he's crooked.
Groucho Marx (1890-1977) ---

In a house of gold, the hours are lead.
Polish proverb as quoted in a recent email message from Patricia Doherty

True power is in the hands of whoever controls the mass media.
Licio Gelli (1919) ---

It was like trying to think about the square root of minus zero.
Harry Stephen Keeler ---

In the end, we will remember not the words of our enemies but the silence of our friends.
Martin Luther King (1929-1968) --- .

Overheard During the 78th Annual Oscars (Yawn) ---

Is sex dirty? Only if it's done right.
Woody Allen

Why We Have Sex: It's Cleansing
Kerr Than, LiveScience, March 2, 2006 --- Click Here
Jensen Comment: I guess abstainers are left somewhere in limbo between dirty (Allen) and clean (Than).

Anyone wishing to communicate with Americans should do so by email, which has been specially invented for the purpose, involving neither physical proximity nor speech.
Auberon Waugh as quoted by Mark Shapiro at

"I'm also tired of the camera moving all over the place, with car chases so cut and edited you don't know what's happening. "It's condescending. Audiences aren't so mindless as movie-makers think." He added: "If you look at The Shining or Fargo, they photograph it and let actors tell a story. That's the old-fashioned way. I hope it comes back."
This is London interview with Anthony Hopkins on March 7 ---

The man was lost and then he was found and now he's more lost than ever -- and he's taking us into the darkness with him. It's time to remove him.
Garrison Keillor calling from Lake Woebegon for the impeachment of President Bush, Salon ---
If a Norwegian yells out in a forest will anybody listen?

After what I experienced with The Passion, I frankly don't give a flying fuck about much of what those critics think.
Mel Gibson, "Apocalypto Now, WorldNetDaily, March 19, 2006 --- Click Here

In reaction, the Sunni tribal leaders formed their own anti-al Qaeda militia, the Anbar Revolutionaries. The group has a core membership of about 100 people, all of whom had relatives killed by al Qaeda. It is led by Ahmed Ftaikhan, a former Saddam-era military intelligence officer, the Telegraph reported. The group claims to have killed 20 foreign fighters and 33 Iraqi sympathizers. The United States has confirmed that six of Zarqawi's deputies were killed in the city of Ramadi in the province. The Associated Press reported yesterday that an Anbar-based group has claimed it killed five top members of al Qaeda and associated groups in Ramadi. The claim was posted on an Islamist Web site and attributed to the Anbar Revenge Brigade, the AP reported. It listed the names of four suspected al Qaeda leaders. The fifth man, it said, was from Ansar al-Sunnah, a terrorist group affiliated with al Qaeda. Iraq, which has suffered under a brutal insurgency for nearly three years, more recently has been racked by sectarian violence after the bombing of a Shi'ite shrine Feb. 22 in Samarra.
"Insurgents claim al Qaeda backers purged from Anbar," The Washington Times, March 14, 2006 ---


The aim of the university is not to make ideas safe for students, but to make students safe for ideas.
Clark Kerr as quoted by David Shapiro at

Why did a world-renowned liberal atheist professor join the Presbyterian Church?
Hint:  It's not because evangelists Falwell and Hagge declare it's the only way through the Pearly Gates

My friend Bill Walker at Trinity forwarded the following link to an article by Robert W. Jensen from the Journalism Department at the University of Texas (no relation to Robert E. Jensen from Trinity University). Professor W  is on the controversial "101 Most Dangerous Professors" list compiled by David Horowitz. Professor W (Robert W. Jensen)  is indeed one of the leading liberalism writers and peace activists of the world.  My main complaint about him is that he wants to deconstruct global business without out any practical reconstruction suggestions about how the world order conducts its economies. He's a journalist and most certainly is not an economist.

Professor W writes and speaks extensively about the United States being an "Evil Empire." One of his papers is entitled "The United States Has Lost the Iraq War, and That's a Good Thing" ---
My comments about his "Evil Empire" are at

Bill Walker forwarded the following link:

I don't believe in God. I don't believe Jesus Christ was the son of a God that I don't believe in, nor do I believe Jesus rose from the dead to ascend to a heaven that I don't believe exists. Given these positions, this year I did the only thing that seemed sensible: I formally joined a Christian church. Standing before the congregation of St. Andrew's Presbyterian Church in Austin, Texas, I affirmed that I (1) endorsed the core principles in Christ's teaching; (2) intended to work to deepen my understanding and practice of the universal love at the heart of those principles; and (3) pledged to be a responsible member of the church and the larger community.
"Why I Am a Christian (Sort Of)," by Robert W. Jensen, AlterNet. March 10, 2006 ---

Jensen Comment
Since Professor W is both an atheist and a liberal activist, William F. Buckley would probably find Professor W more suited for Yale than the University of Texas ---
But I don't think Buckley anticipated an atheist who's becoming an intellectual pillar of the Presbyterian Church. That makes Professor W more suited to Princeton University.

The liberal media speaks out on liberalism's pressing problems

1.  Why the disconnect on religion is one of liberalism's most serious problems.
The right-wing hijacking of the role of religion in our political discourse is as undeniable as it is (constitutionally) inappropriate. Eric Alterman explains the liberal media's willful ignorance on the subject and why the disconnect on religion is one of liberalism's most serious problems.

The moronic level of cable discourse notwithstanding, missing from almost all discussions of the role of religion in public life is what William James famously termed the "varieties of religious experience." The right-wing hijacking of religion's public role in our political discourse is as undeniable as it is inappropriate, and represents one of liberalism's most serious problems.
Eric Alterman, "With God on Our Side?" The Nation, March 2, 2006 ---

The film's potential is lost, however, at the point when the question is broached of why we are so uncomfortable about homosexuality in America. In a totally unsophisticated manner, Taylor presents a several-minute montage of laypeople lambasting Christianity, culminating with Dan Savage calling the religion "bullshit" that was made up by "some guy in a desert a few thousand years ago." Granted, many Christians aren't exactly gay-friendly, and there's a history of some Christians doing extremely hateful things to homosexuals, but referring to someone's cherished beliefs with expletives isn't the greatest way to make friends. The Michael Moores of the world already have made enough self-congratulatory films for progressives. If any movement is to be made in increasing tolerance of homosexuality, we as liberals need to stop attacking Christianity outright and instead focus on the values of compassion and love which are common to us both. Many progressive brands of Christianity exist that do not demonize gays, and there are movements within fundamentalist denominations to become more tolerant. Taylor would do well to include a bit of this balance rather than paint such a crude picture of a nuanced and varied religion.
Jason Ketola, "Liberals, think WWJD! Progressives need to stop thinking of Christianity as something against to battle against." The Minnesota Daily, February 13, 2006 ---

2.  From The Nation: Is patriotism a positive political force?
Todd Gitlin uses patriotism to wallop the radical left

"Pledging Allegiance," by Daniel Lazare, The Nation, March 2, 2006 ---  

In much of the world, the answer is no or a highly qualified maybe. In Britain, English patriotism verges on the comical (see the collected works of Rowan Atkinson for more details), while the United Kingdom, an array of feudal fiefdoms stretching from the Channel to the North Sea, is far too antiquated a structure to stir up much patriotic passion in anyone other than a far-rightist. Does the average cockney's heart beat faster when contemplating the offshore bankers of Jersey or the noble fishermen of Shetland pressuring Brussels for more favorable cod quotas? Don't make us larf!

In France, la patrie is a political concept, meaning that one's view of it is a direct function of one's place on the left-right spectrum. If you're a Gaullist you may have some lingering attachment to la France profonde; if you're a liberal, you want to see it subsumed under the EU, while if you're among the 10 percent of the electorate that voted Trotskyist in the 2002 presidential elections, the very word smacks of Pétainism and the reactionary "integral" nationalism of Charles Maurras. In Germany, patriotism is controversial due to certain nationalist excesses of the mid-twentieth century, while in Italy it exists only on a local level. In Canada, no one quite knows what it means, for the simple reason that no one quite knows what Canada means other than that part of North America that looks like the United States but doesn't believe in capital punishment, mass incarceration or the virtues of maintaining military bases in more than a hundred foreign countries.

Continued in article

Jensen Comment
Obviously the patriotism card is an important trump card in American politics --- possibly because we're always in hot wars or cliff-hanging cold wars. Our wars never seem to take a recess like they do in Europe and Asia. Patriotism is allegedly less important (see the above quotation) in nations like Canada that are rarely threatened from the outside. Nations do become more patriotic when they are under siege as in the case of the recent bombings in London where even the "average Cockney" did not "larf" much.

Many liberals will sigh or even "larf" out loud when they listen to the following patriotism music. But these songs that are repeatedly broadcast on hundreds of  radio stations from coast to coast bring tears to the eyes of millions of Americans who elected George W. Bush on two occasions to be their President. The best way to get an American voter to vote Republican is to dishonor the flag --- which is most likely why presidential hopeful Hillary Clinton conditionally supported a bill to make flag burning illegal (but not unconstitutional). Republican candidates in 2008 will probably voice support to make it unconstitutional.

The Old Ragged Flag (Johnny Cash) ---

Songs that have a great deal of influence on millions of America's voters ---

"So here's your challenge, lefty bloggers"
"Why do conservatives like Bush? Conservatives love Bush because the left hates him," by David Boaz, The Guardian, March 16, 2006 ---

Why do conservatives like Bush? After all, even his defenders call him a "big-government conservative," which was once an oxymoron. He's increased federal spending 48 percent in six years, further centralized education (which on this side of the pond we consider both un-conservative and un-[classical] liberal), inaugurated the biggest expansion of entitlements since the profligate President Lyndon B. Johnson, lured 17 percent more people onto the welfare rolls during five years of economic growth, and declared that "When somebody hurts, government has got to move."

So why do conservatives who grew up on Reagan like Bush? I can think of several reasons:

1. Tax cuts. Defying the establishment media and the class warfare of the Democrats, he has persisted in the Reaganite mission of cutting taxes, especially income tax rates.

2. The war. He stands up to the Islamo-fascists, as Reagan stood up to the evil empire. And as long as conservatives believe that the war in Iraq is part of the war on terrorism, they will support Bush there.

3. Religion. Conservatives like his willingness to talk about his born-again faith and to bring conservative Christian values (as he defines them) to political issues such as abortion, gay marriage, stem cell research, and government funding for religious charities.
And finally,

4. As a nominating speech for President Grover Cleveland once put it, "They love him most for the enemies he has made." Conservatives love Bush because the left hates him. If the New York Times would run a front-page story headlined "Bush Delivers the Big Government Clinton Never Did," and the lefty bloggers would pick it up and run with it, maybe conservatives would catch on.

So here's your challenge, lefty bloggers: If you don't like the tree-chopping, Falwell-loving, cowboy president - if you want his presidency fatally wounded for the next three years - then start praising him. One good Paul Krugman column taking off from that USA Today story on the surge in entitlements recipients under Bush, one Daily Kos lead on how Clinton flopped on national health care but Bush twisted every arm in the GOP to get a multi-trillion-dollar prescription drug benefit for the elderly, one cover story in the Nation on how Bush has acknowledged federal responsibility for everything from floods in New Orleans to troubled teenagers, and maybe, just maybe, National Review and the Powerline blog and Fox News would come to their senses. Bush is a Rockefeller Republican in cowboy boots, and it's time conservatives stopped looking at the boots instead of the policies.

March 17, 2006 reply in the Opinion Journal

We suspect, though, that it'd take a lot more than a few contrarian pro-Bush columns or blog entries to overwhelm the widespread Bush-hatred on the left. Sen. Russ Feingold--whether acting out of that compulsion or pandering to it--is proposing a resolution to "censure" the president for trying to prevent another terrorist attack on America. Feingold apparently has all of two supporters thus far for his initiative, Barbara Boxer of California and Tom Harkin of Iowa, and, as the New York Times (Click Here) reports, the GOP is delighted:

*** QUOTE ***

Republicans, worried that their conservative base lacks motivation to turn out for the fall elections, have found a new rallying cry in the dreams of liberals about censuring or impeaching President Bush. . . .

With the Republican base demoralized by continued growth in government spending, undiminished violence in Iraq and intramural disputes over immigration, some conservative leaders had already begun rallying their supporters with speculation about a Democratic rebuke to the president even before Mr. Feingold made his proposal.

*** END QUOTE ***

The Angry Left is all too eager to cooperate with Feingold's effort at boosting Republican turnout. Markos "Kos" Moulitsas  yesterday posted a list of 21 "Democratic senators [who] have come out for censuring the president," then crankily observed, "Unfortunately, the president being censured was Bill Clinton, not George W. Bush. Because, you know, these senators had their priorities straight."

Save USA: Dick, take George hunting.
Sign at a Code Pink protest march ---

The Other Side of the Coin

Forwarded by Auntie Bev

Dictionary of Republicanisms


Alternative energy sources n. New locations to drill for gas and oil.


Bankruptcy n. A punishable crime when committed by poor people but not corporations.


Class warfare n. Any attempt to raise the minimum wage.


Climate change n. The day when the blue states are swallowed by the oceans.


Compassionate conservatism n. Poignant concern for the very wealthy.


Creationism n. Pseudoscience that claims George W. Bush's resemblance to a chimpanzee is totally coincidental.


DeLay, Tom n. 1. Past tense of De Lie; 2. Patronage saint.


Democracy n. So extensively exported that the domestic supply is depleted.


Fox News fict. Faux news.


Free markets n. Halliburton no-bid contracts at taxpayer expense.


Girly men n. Males who do not grope women inappropriately.


God n. Senior presidential adviser.


Growth n. 1. The justification for tax cuts for the rich. 2. What happens to the national debt when Republicans cut taxes on the rich.


Habeas corpus n. Archaic. (Lat.) Legal term no longer in use (See Patriot Act).


Healthy forest n. No tree left behind.


Honesty n. Lies told in simple declarative sentences--e.g., "Freedom is on the march."


House of Representatives n. Exclusive club; entry fee $1 million to $5 million.


Laziness n. When the poor are not working.


Leisure time n. When the wealthy are not working.


Liberal(S) n. Followers of the Anti-Christ.


Neoconservatives n. Nerds with Napoleonic complexes.


9/11 n. Tragedy used to justify any administrative policy.


No Child Left Behind riff. 1. V. There are always jobs in the military.


Ownership society n. A civilization where 1 percent of the population controls 90 percent of the wealth.


Patriot Act n. The pre-emptive strike on American freedoms to prevent the terrorists from destroying them first.


Pro-life adj. Valuing human life until birth.


Senate n. Exclusive club; entry fee $10 million to $30 million.


Simplify v. To cut the taxes of Republican donors.


Staying the course interj. Slang. Saying and doing the same stupid thing over and over, regardless of the result.


Shit happens interj. Slang. Donald Rumsfeld as master historian.


Voter fraud n. A significant minority turnout.


Wal-Mart n. The nation-state, future tense.


Water n. Arsenic storage device.


Woman n. 1. Person who can be trusted to bear a child but can't be trusted to decide whether or not she wishes to have the child. 2. Person who must have all decisions regarding her reproductive functions made by men with whom she wouldn't want to have sex in the first place.


"GOP Struggles To Define Its Message for 2006 Elections," by Dan Balz and Jonathan Weisman, The Washington Post, March 20, 2006; A01 --- Click Here

Every effort so far to produce such a platform has stumbled.

In January, Bush laid out a modest menu of ideas on health care and energy independence, but Congress has made little movement on them. Senior White House officials consulted with lawmakers earlier this year about jointly crafting an agenda that would allow Bush and Republicans in Congress -- both suffering from depressed public approval ratings -- to get off the defensive. A Republican familiar with the process said these discussions did not result in a consensus.

New House Majority Leader John A. Boehner (R-Ohio) has been wrestling with the same problem, so far without success.

The struggles reflect philosophical differences among competing factions within the party, but they also underscore the political consequences of holding power. Republicans insist they remain united around core principles of smaller government, lower taxes and a strong national defense, but can no longer agree on how to implement that philosophy and are squabbling over their delivery on those commitments.

Texas Gov. Rick Perry (R) said the root of the problem is a failure of Washington Republicans to stick to principles, saying that his party risks losing power because it has done "a pretty poor job" of executing its small-government philosophy. "Republicans just need to take stock, go back and realize that the American people elected them because of their principles, and when you do not adhere to those principles, the American people are just as likely to turn you out and choose someone else."

Continued in article

Jensen Comment
The Republican Contract With America is serious political reform that makes sense to me. It's too bad more Republican politicians will not support it where and when it counts ---



The Accoona Super Target search engine is at
That being said, Accoona looks, at first glance, not much different than other search engines — including Google itself. Its bare-bones initial interface follows the same design: A central search field with buttons that let you search the entire Web or confine your search to news or business sources. Searching On Scott I started with a general Web search on "Scott Joplin" on Accoona and Google, and found quite a bit of disparity in the results (112,393 for Accoona and 4,130,000 for Google). When I did a search on the phrase "mp3 players," I got similar results: Accoona came up with 6,031,343 results, while Google boasted 187,000,000. Quite frankly, while I appreciated Google's higher numbers, that alone wouldn't have made Google my preferred search engine — how many people go past the fifth page of results, anyway? There was also some variation in which sites came up in what order, but again, there were no really important differences. Interestingly, I found Accoona's results page easier to read; Google has added so much advertising — plus news links — on top of its listing that it's gotten a bit difficult to find where my actual results begin. Accoona's results page was much cleaner; the results were headed only by a "Tell me about Mp3 players" link that led to a definitions page. Of course, when/if Accoona succeeds in attracting advertising, that could change radically.
Barbara Krasnoff, "Accoona: A New Google Alternative? The latest search engine to hit the Web, Accoona offers additional business info and a nice filtering ability. But is that enough? InternetWeek, March 20, 2006 ---

A good place to start if you're looking for something
(Addresses, People, Zip Codes, Maps, etc.)

Google (Shopping) Catalogs ---

Yahoo (Shopping) Catalogs ---

O'Keefe Accounting Library Searches

Fee Based Google Specialized Services (including an enterprise-level search appliance)
Google Inc. added two beefier Minis to its line of business search appliances.
The Mountain View, said Minis are now available with capacities of 200,000 documents and 300,000 documents for $5,995 and $8,995, respectively. The new versions were in addition to the current 100,000-document appliance that sells for $2,995. Google also sells an enterprise-level appliance that can search up to 15 million documents. The device starts at $30,000 for searching up to 500,000 documents.
Antone Gonsalves, "Google Unveils Two Search Appliances," InternetWeek, January 12, 2006 ---

Bob Jensen's threads on search engines are at 

Academics should remember that Google Scholar greatly narrows down the search hits ---

Holland launches the immigrant quiz
The U.S. just admitted 3,000 Muslims in one block from Russia
What do you think would happen if we applied a topless-woman test to each immigrant in the U.S.?

TWO MEN kissing in a park and a topless woman bather are featured in a film that will be shown to would-be immigrants to the Netherlands. The reactions of applicants — including Muslims — will be examined to see whether they are able to accept the country’s liberal attitudes. From this Wednesday, the DVD — which also shows the often crime-ridden ghettos where poorer immigrants might end up living — will form part of an entrance test, in Dutch, covering the language and culture of Holland.
Nicola Smith, "Holland launches the immigrant quiz," London Times, March 12, 2006 ---
Jensen Comment: 
Seems like this test will increase the number of male immigration applicants from outside the Muslim world. Where are Holland's feminists in all this?

Typical Diversity in Academe:  Preaching to the Choir
Members of Amnesty International and Students for Social Justice gathered in the Welles-Brown Room on Wednesday night to listen to three UR professors chair a panel on the current war in Iraq. If they need three profs to chair a panel, it must be because they want a variety of viewpoints--left, middle and right--right? No, of course not. It's left, left and left. But the funniest participant was the philosopher.

Opinion Journal, March 9, 2006

"Professors speak against war," by: Matt Majarian, Campus Times, March 3, 3006 --- Click Here

After introductions and applause for each member of the panel, Holmes took the microphone to address the assembled audience and chastise the U.S. Government.

"We are in violation of international law in the actions that we are taking," Holmes said. "In having attacked Iraq and overthrown its government, we have committed the same violations of the U.N. Charter for which we killed many Nazis."

Too bad there wasn't a historian on the panel to point out that Nazi Germany had fallen by the time the U.N. Charter came in to existence.
Opinion Journal, March 9, 2006

Jensen Comment
Is it bad we "killed so many Nazis?" And if it had been in violation of a U.N. Charter, should we have waited for the an insane mass murderer to control all of Europe and to exterminate millions more Jews, homosexuals, and others deemed genetically undesirable among the master Aryan race? To this we might add that Hitler was also working on WMDs that may well have given him the early-on power to rule the entire planet and to exterminate all people of color, including the despised Jessie Owens. Following the World War I fiasco, going off to another one of Europe's wars was not a popular idea in the United States in the late 1930s and early 1940s. President Roosevelt secretly got the U.S. deeply involved without legislative approval. I doubt that he would have paid the least bit of attention to U.N. objections.

Seeing is not believing, at least not after visiting the following site

Computational Visual Cognition Laboratory at MIT ---

The Computational Visual Cognition Laboratory is part of the Perceptual Science Group, in the Department of Brain and Cognitive Sciences. CVCL is a new research laboratory at MIT and is currently located in the 4th floor of the NE-20 Building, above the MIT COOP, in the Kendall Square area of Cambridge, MA.

Our research program concerns the investigation of high-level human cognition and more particularly real world scene understanding. Scenes are 3-dimensional complex structures composed of a variety of objects, textures, colors, materials and spatial layouts. Yet, we understand novel scenes quickly and effortlessly. In the laboratory, we approach the scene understanding problem from a computational stance (e.g., what are the statistics in natural images that are relevant for perception and categorization? How can we model scene categorization?); a brain imaging approach (e.g., what are the neural correlates of scene and space recognition?); and a behavioral viewpoint (e.g., how well do humans recognize scenes under various perceptual conditions and task constraints?).

Our current activities investigate the psychological, formal and neural substrates of the representation of visual complexity and visual simplicity in the context of real world scenes; the representation of spatial envelope and spatial layout; the relations between image statistic descriptors and the conceptual representation of scenes and objects; the perception and modeling of higher-level scene attributes; the mechanisms of scene recognition in brief glances (gist) as well as mechanisms of attentional deployment in complex scene. These research topics bring together disciplines such as perceptual science, cognitive psychology and neuroscience, photography, architecture and interior design, image processing and computer graphics.

Students and visitors in the lab have the opportunity to be trained in computational, brain imaging and perceptual/cognitive aspects of a visual science topic, as well as collaborating with researchers in the Boston area (BCS department, CSAIL, Psychology Department at Harvard, Boston University, the Visual Attention Lab at Harvard Medical School).

Facilities in the lab includes Dell and Macintosh workstations, 3-D stereo equipments, eyetracker, panoramic screen. Behavioral experiments, data analysis and modeling are all based in Matlab.



US navy, 'pirates' clash off Somalia
On March 15, the UN Security Council encouraged naval forces operating off Somalia to take action against suspected piracy. Pirate attacks against aid ships have hindered UN efforts to provide relief to the victims of a severe drought in the area. The pirate raids are part of the anarchy wracking Somalia, which has had no effective government since 1991, when warlords ousted a dictatorship and then turned on each other.
"US navy, 'pirates' clash off Somalia," Al Jazeera, March 19, 2006 --- Click Here

Twelve suspects, including the wounded, were taken into custody after the early morning gun battle , said Lt Cmdr. Charlie Brown, spokesman for the US navy's 5th Fleet, on Sunday.


The nationalities and identifications of the suspected pirates were unknown.

The shootout early on Saturday ensued after the navy ships, patrolling the area as part of a Dutch-led coalition task force, spotted the suspect 30-foot-long fishing boat towing smaller skiffs and prepared to board and inspect the vessels, Brown told The Associated Press.


A statement from the Bahrain-based 5th Fleet said the suspected pirates were holding what appeared to be rocket-propelled grenade launchers.


When the suspects began shooting, naval gunners on the US ships returned fire with mounted machine guns, killing one man and igniting a fire on the vessel.


Field treatment

Three suspects were seriously wounded and being treated on one of the navy ships, Brown said. A Dutch navy medical team was en route aboard the HNLMS Amsterdam. No US sailors were injured in the gun battle.


Pirate attacks surged to 35 last year from two in 2004 (File pic)

The navy boarding teams confiscated an RPG launcher and automatic weapons, the statement said.


The navy said the incident involving the Norfolk, Virgina-based USS Cape St. George and USS Gonzalez occurred at about 5:40 am local time, approximately 25 nautical miles off the Somali coast in international waters.


The International Maritime Organisation has warned ships to stay away from the Somali coast because of pirate attacks, which surged to 35 last year from two in 2004.

Continued in article

Also see

Harvard Study Critical of Pro-Israel Lobby in the U.S.
A new study, claiming that the pro-Israel lobby in America caused the United States to skew its Middle East policy in favor of Israel, is stirring controversy in the pro and anti-Israel communities in the US. The 81-page report, written by John J. Mearsheimer and Stephen M. Walt for the Kennedy School of Government at Harvard University, argues that the pro-Israel lobby in the US managed to convince American lawmakers, officials and US public opinion to support Israel, even though this support runs counter to America's own national interests.
Nathan Guttman, "Study: AIPAC works against US interests," Jerusalem Post, March 19, 2006 --- Click Here

For a highly critical review see

The American Association of University Professors in February postponed an international conference on academic boycotts that was scheduled to take place that month in Italy. Both the participant list for the invitation-only session and the materials distributed for the session had come under fire. AAUP officials defended the invite list (which was criticized as anti-Israel by some) and apologized for including in conference packets an anti-Semitic article published in a magazine affiliated with Holocaust deniers . . .
Scott Jaschik, "AAUP Calls Off Boycott Conference," Inside Higher Ed, March 21, 2006 ---

But in a letter sent last week to conference participants, association leaders said that they could not go ahead with the conference. The organizers wanted to hold the conference with the original invitees, but realized, the letter said, that such a course of action would “reactivate opposition that has proved too severe to enable us to go forward.” So instead, no conference will be held, but written comments prepared by the invitees for the meeting will be published by the AAUP in Academe, its magazine.

The idea behind the conference grew out of debates over a movement last year by Britain’s main faculty union to boycott two Israeli universities. The AAUP and many other academic groups criticized the boycott as antithetical to academic freedom and the boycott was eventually rescinded. In the wake of that controversy, the AAUP started drafting a statement about academic boycotts (strongly opposing them) and organizing the conference, which was to have been held at Bellagio, in Italy, where 22 scholars from around the world were to have gathered to discuss academic boycotts.

Criticism of the conference initially focused on those 22 scholars, a number of whom were active in the movement in Britain to boycott the Israeli universities. The critics said it didn’t make sense for a conference trying to outline an intellectual viewpoint against boycotts to include prominent supporters of just the kinds of boycotts it was trying to discourage. AAUP officials, however, defended the invitations, saying it was appropriate to talk to all parties.

Privately, some backers of the conference characterized the controversy as primarily the result of pro-Israel activists working to discredit the meeting. While some pro-Israeli scholars spoke out against the conference, others who questioned the way the conference was organized are in fact critical of the government there and are not involved in pro-Israel activism.

The letter announcing that the conference would not be held at all defended the original invitation list and said it would be wrong to alter the list now.

“Opposition to the conference as originally planned, from those who claimed it focused unduly and unfairly on the Middle East, was intense even prior to our inadvertent and careless inclusion of a paper from an anti-Semitic Web site. Our error, though quickly discovered and corrected by us, was then effectively cited by those, within and without the association, who urged postponement and reorganization,” last week’s letter from the AAUP said. “This view persists. But to hold the conference with a significantly revised set of participants, as critics suggest, would unfairly exclude some previously scheduled participants. Moreover, altering the list of participants in order to pacify our critics would imply that we had come to accept their arguments about the direction and composition of the conference. We have not.”

By publishing the thoughts of conference invitees in Academe, the letter said, along with an explanation of why the conference was designed as it was, organizers hope to fulfill some of their original goals. “Our goal then and now is a full and frank exchange of views,” the letter said.



House minority leader Nancy Pelosi has never been known as the brightest bulb in Congressional chandelier, but with her seniority she often is a difficult obstacle for Republicans. She faces a difficult challenge of representing the most liberal anti-business and anti-war district in the United States.

Why then has Nancy suddenly become the darling of the Editorial Page of The Wall Street Journal?

"Two Cheers for Nancy Pelosi," by Mallory Factor, The Wall Street Journal, March 18, 2006, Page A9 ---

Have America's entrepreneurs and corporate leaders found a new voice of regulatory sanity in, of all people, Nancy Pelosi? Apparently so, and that should be a wake-up call to Republicans -- because like everything else in the free market, the free enterprise agenda is up for grabs. In the recent "Innovation Agenda" that the House Democratic leader and her party unveiled, Ms. Pelosi acknowledges specifically the need to "ensure Sarbanes-Oxley requirements are not overly burdensome," and endorses reform. Meanwhile, the scourge of Wall Street, New York Attorney General Eliot Spitzer, is criticizing Sarbanes-Oxley's "unbelievable burden on small companies" and its possible role in "preventing some initial public offerings."

Ms. Pelosi and other Democrats have been quicker to recognize what many traditional champions of free enterprise have been slow to see: the law's disastrous consequences for our nation's ability to compete. Congress passed this law hastily in 2002 after the egregious accounting frauds at Enron and WorldCom. The intent was to hold publicly held companies and their executives more accountable and weed out bad actors; but that's not been the effect. Four years after passage, it is now evident that the costs of Sarbox clearly outweigh the benefits.

Consider first the costs. Recent estimates from the American Electronic Association, for example, show that U.S. companies are spending $35 billion annually simply to comply with the law as opposed to original federal estimates of $1.2 billion. A University of Nebraska study found that audit fees for Fortune 1000 companies, on average, increased a staggering 103% from 2003 to 2004. The costs of being a U.S. public company are now more than triple what they were before the law passed, according to a study conducted by the Milwaukee-based law firm of Foley & Lardner. Some smaller firms report that they are spending 300% more on Sarbox compliance than on health care for their employees.

Based on a growing body of theoretical and empirical research, the SEC's Advisory Committee on Smaller Public Companies concluded that Sarbox places a disproportionate compliance burden on small public companies, making it more difficult for them to compete with foreign companies and to a lesser extent with larger U.S. companies. Consider the survey by the American Electronics Association, which found that companies with sales of $100 million and under are spending 2.6% of their revenues on Sarbox compliance -- enough to tip many of them from profitability into unprofitability. This makes it something of a challenge for these companies to innovate, compete or grow -- or even survive.

As a result of these burdensome costs, enterprises are deciding not to go public, or else are opting to back out of our capital markets. Explaining his company's absorption into privately held Koch Industries, Peter Correll, the CEO of Georgia-Pacific, said, "There is a lot of time spent by top management on things that are not value-adding, but are simply bureaucratic and are required by a raft of regulation." In fact, the Foley & Lardner study found that 20% of public companies are considering going private just to avoid Sarbox compliance. It's no wonder, then, that the London Stock Exchange -- eager to exploit a competitive advantage -- now promotes itself by reminding companies that by listing on the LSE they are not subject to Sarbox.

Beyond the direct cost of compliance to individual companies, a recent University of Rochester study concluded that the total effect of the law has reduced the stock value of American companies by $1.4 trillion. That is $1.4 trillion that could be invested in infrastructure improvements, jobs, innovative technologies or research and development. As Sun Microsystems CEO Scott McNealy says, Sarbanes-Oxley throws "buckets of sand into the gears of the market economy."

The true beneficiaries of Sarbox are the nation's large auditing firms, which now maintain a regulatory oligarchy composed of a handful of entrenched services corporations. They will continue to champion Sarbox, since it provides a guaranteed market for their services. Surely this law was not intended by its authors to become a full employment act for the same auditing industry which was implicated in the original malfeasance of four or five years ago.

Continued in editorial

Bob Jensen's threads on auditing reforms are at

Can you really run Windows XP on a Mac that runs on an Intel processor?

The answer is yes, but you must be a geek to do it.

"Apparent Proof of XP on Intel Mac," Wired News, March 15, 2006 ---

Apparent Proof of XP on Intel Mac Mac on Intel has provided a link to a video that appears to show the full procedure for installing, booting and using Windows XP on an Intel Mac by narf2006. The contest sponsors are still testing the procedure now.

You can see the video here or here. It's fairly convincing stuff. The only possible way I can think to fake this would be if they got into the iMac's internals and connected its screen to an outside computer. I haven't messed with a current-generation iMac, but it was certainly possible back when it came in colors. If real, this is a pretty astounding accomplishment, given that Microsoft won't be supporting EFI for years.

This comes on the same day that two readers of MacWindows reported about their experiences with Q, the cocoa-based port of QEMU, on their Intel Macs. Apparently, Win XP SP1 and 98 run pretty darn well. Yes, you read that right.

"Mac Runs Both Windows XP, Mac OS X:  A pair of Californians figured out a way to dual-boot an Intel Mac with both Mac OS X and Windows XP, winning a $14,000 prize. But the technique isn't for beginners," by Gregg Keizer, Information Week, March 16, 2006 --- 


After I retire I intend to shift to a Mac largely because of the enormous protections it has against viruses, spyware, etc. relative to infection-prone Windows operating systems.  However, in recommending this for everybody, there are some special considerations.

Walt Mossberg provides some help in this regard.  Especially note his last paragraph!!!
From The Wall Street Journal, September 29, 2005; Page B4 ---