Tidbits on May 6, 2005
Jensen at Trinity
Fraud Updates ---
For earlier editions of New
Bookmarks go to http://www.trinity.edu/rjensen/bookurl.htm
Archives of Tidbits: Tidbits Directory --- http://www.trinity.edu/rjensen/TidbitsDirectory.htm
here to search Bob Jensen's web site if you have key words to enter --- Search
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 http://www.searchedu.com/.
Bob Jensen's home page is
Security threats and hoaxes ---
Music for the Summer Break: http://www.jessiesweb.com/blessing.htm
I will soon be taking a break from
publishing Tidbits and New Bookmarks. My wife is scheduled
her eighth back surgery. The two 18-inch rods that were bolted to
spine in October never did work correctly and have been very painful. Now
these rods will be removed and replaced with more bone fusions. I will be
busy in our mountains helping her recover. I leave Texas on May 12 after
my last final examination. I may have time for one or two more editions of
of Erika ---
Please check on your bank account ---
Update on the dirty secrets of academe: Are we
elitist and self-aggrandizing to a fault?
I’m glad to report that the full professor soon
left the university, the book came out, I got tenure, was promoted, and life
has been rosy ever since. But the professor’s elitist drivel still sticks in
my craw because his snobbery runs so rampant in the academy today — as what
I experienced with the dopey professor from the Department of Cinema and
Stephen G. Bloom, "Hello Sy Hershman, Goodbye Bob Woodward," Inside
Higher Ed, May 4, 2005 ---
Update on the dirty secrets of our credit card
systems: A hidden "tax" on those that pay by check or cash
Per-transaction "interchange" fees are a silent but
very effective tax. And as card issuers continue down the perilous path of not
charging their customers anything for the credit cards they use, the thirst for
"tax money" becomes ever greater.But the real rub is that retailers will
pass along the higher premium-card fees to all customers, including those who
don't qualify for a credit card, let alone a premium card. Checks and cash still
account for more than 50% of all retail payments, and the sad truth is that it
is precisely those who can pay only by check or cash who are footing most of the
bill for the costs of these cards. In most tax systems the wealthy pay most of
the taxes; in this model, those who can't or don't use credit cards are paying
for those who do qualify for them. Here's the real dirty secret of the
card-issuing industry: Because card regulations demand that cardholders pay no
more for goods and services than cash and check customers, the working poor are
subsidizing the vacation points earned by America's top income classes.
"A Dirty Little Secret About Credit Cards," The Wall Street Journal, May
4, 2005; Page A19 ---
Bob Jensen's threads on "Dirty Secrets of Credit Card
Companies and Credit Rating Agencies" are at
Why should you be taking daily doses of Vitamin B6?
High daily levels of vitamin B6 may reduce the risk
of getting colon cancer by 58 percent, claims a new study from Harvard Medical
School. The research, published in the May 4 issue of the Journal of the
National Cancer Institute, builds on other studies that have already indicated a
strong preventive effect from the vitamin. "There are several smaller studies
that have found a protective effect from dietary intakes of B6," said lead
researcher Esther K. Wei, an instructor in medicine at Harvard Medical School
and Brigham and Women's Hospital. However, "this is the first large study of
women to look at blood levels of B6" and find a protective effect, she added.
Kathleen Doheny, "Vitamin B6 Cuts Colon Cancer Risk High daily intake reduced
odds by 58 percent, study found," HealthDay, May 4, 2005 ---
The National Institute of Health has a great Website on recommended dosages
and sources of vitamins. The Table of Contents for Vitamin B6 is as
Vitamin B6: What is it?
What foods provide vitamin B6?
What is the Recommended Dietary Allowance for vitamin B6 for adults?
When can a vitamin B6 deficiency occur?
What are some current issues and controversies about vitamin B6?
What is the relationship between vitamin B6, homocysteine, and heart
What is the health risk of too much vitamin B6?
Selected Food Sources of vitamin B6
Jensen Comment: I think the connection between colon cancer and vitamin B6
was made after the above pages were written.
Tax incentives to buy hybrid cars ---
A tax expert ( W. O. Mills III
[wom@WOMILLS.COM] ) forwarded a link to
May 6, 2005 reply from Deborah Johnson
An interesting link, which goes to support the
hypothesis that the Federal Government is "confused".
The instructions indicate you claim the "clean fuel
tax deduction" on the form 1040, in the section on "Tax, Credits and
Payments". Then goes on to instruct you to write in on line 35. Line 35 on a
form 1040 is the place you add up all the adjustments to gross income.
College Slogans (really)
Still others appear to need re-thinking. Bentley
College says it’s “America’s Business University” and Mississippi College calls
itself “A Christian University,” even though they’re both colleges. Bucknell
University clarifies its standing as “A College-Like University.” Teens like the
word “like.” Something seems missing in Berklee College of Music’s “Nothing
Conservatory About It,” whereas Thiel College’s “Thiel Time” could be confused
with “Miller Time” or “Tool Time.” Trinity Western University’s “Unwrap the
Universe, Peel Back its Shroud” sounds vaguely obscene, as does the University
of Richmond’s “Do it With Your Head.” Don’t The Sage Colleges and Quincy College
send mixed messages with “Change Your Mind” and “Think Again"?
Mark J. Drozdowski, "Gaglines," Inside Higher Ed, May 6, 2005 ---
Jensen Comment: None seem to use more appropriate slogans like "Butts Off
Here" or "Hangover Hell" or "Class Avoidance Time."
Book Slogans (well sort of anyway)
Name that famous book from just these phrases: "pagan harpooneers,"
"stricken whale," "ivory leg."
Name that famous book from just these phrases: "pagan
harpooneers," "stricken whale," "ivory leg." Or how about this one: "old sport."
Yes, it's Herman Melville's Moby Dick and F. Scott Fitzgerald's The Great
Gatsby, respectively, but the words aren't just a game. They are Statistically
Improbable Phrases, the result of a new Amazon.com feature that compares the
text of hundreds of thousands of books to reveal an author's signature
constructions. The haiku-like
SIPs are not the only word toys on the site.
Customers can also see the
100 most common words
in a book. Penny pinchers -- or those with back
problems -- can check stats on how many words a volume delivers per dollar or
per ounce. (Bargain hunters will love the Penguin Classics edition of
War and Peace that delivers 51,707 words per dollar.)
Customers can also see how complicated the writing is
(yes, post-structuralist Michel Foucault's
prose is foggier than Immanuel Kant's), and how
much education you need to understand a book. (To understand French philosopher
Pierre Bourdieu, you'll need a second Ph.D.) While such services seem to have
little value and have generated scant publicity, except from
bibliophilic thrill seekers, web watchers say the
madcap stats aren't just for kicks. Ray Singel, "Judging a Book by
Its Contents," Wired News, May 5, 2005 ---
May 6, 2005 reply from Bender, Ruth
This is absolutely fascinating! I tried it on my
own book (Corporate Financial Strategy) and took great issue with the
results it brought up as SIPs - until I then did a search on those words in
my Word text of the book and found that yes, I had used the phrases several
I can see hours of wasted time ahead as I test out
all the core finance books and chose my course text by SIPs alone!
Dr Ruth Bender
Lecturer in Finance
Cranfield School of Management
Cranfield Bedfordshire MK43 0AL United Kingdom
From the University of Pennsylvania:
Eight Great Business Plans, But Only One Is the Winner
Ask anyone involved in the healthcare field -- doctors, insurers, drug makers,
and certainly patients -- and they will tell you that the industry is in dire
need of an overhaul. But chaos, which often precedes change, presents
opportunities too. Five of the eight teams in the Venture Finals of the 2005
Business Plan Competition see promise in the upheavals
that are roiling the healthcare sector. These teams proposed businesses that
would, among other things, help in the treatment of critical wounds, prevent
drug abuse and test for serious illnesses such as breast cancer. The three
remaining teams focused on information technology, offering plans to prevent
Internet fraud, improve college fundraising and enhance "mission-critical"
computing . . . The winner of the 2005 Venture Finals is FibrinX. Team members
collected the $20,000 first prize as well as in-kind donations of accounting,
legal and consulting services, and say they hope to turn their plan into a
startup company after they graduate. "We have several different options we are
looking at, but this is definitely top of mind," Gosalia said. They are already
fishing for investors.
"Eight Great Business Plans, But Only One Is the Winner ... ," Knowledge@wharton
The high-tech political candidate in NYC
His proposals rely heavily on developing universal
Wi-Fi and wiring the subways for cell phones. He looks to the model of open
source as a way for the citizenry to identify, report and fix problems -- for
example, he says it's a fine idea if New Yorkers could use cell-phone cameras to
report potholes to the proper authorities. And he thinks it's a crime that the
city's schools have to schedule students to visit the computers instead of
offering them -- and their parents and teachers -- an internet connection 24/7,
just like Fortune 500 companies do with their employees, customers and
Adam L. Penenberg. "The Techno Candidate," Wired News, May 5, 2005
From National Public Radio: You can listen to the answers
Why should you avoid using the word "spacious" if
you're trying to sell your house? What does Paul Feldman's bagel delivery
business teach us about corporate corruption? Is there a way to bet on the
horses and consistently win? Economist Steven Levitt shares some unconventional
insight from his book, Freakonomics: A Rogue Economist Explores the Hidden Side
Also see "Cracking the Real Estate Code," by Steven Levitt ---
Fraud Hits Small Businesses the Hardest
According to the Association of Certified Fraud
Examiners, the most costly abuses occur in organizations with fewer than 100
employees. In its 2004 Report to the Nation on Occupational Fraud and Abuse, the
association reports that the average organization loses about 6 percent of its
total annual revenue to fraud and abuse committed by its own employees. Take the
case of Lorain National Bank in Ohio, where federal prosecutors have indicted a
longtime accounting employee for allegedly taking more than $240,000, according
to the Morning Journal newspaper of Lorain. Apparently acting alone, Mary Scaff
of Vermilion is accused of taking $159,888 in deposits, intended for a bank
customer's account, and diverting them to her own use. She also allegedly took
$83,000 that was supposed to be used to pay postal expenses. ''Instead of paying
for postage with these cashier's checks, the defendant wrote her own Visa
account number on each check and mailed them as payments on her own personal
account,'' the indictment said.
"Fraud Hits Small Businesses the Hardest," AccountingWeb, April 29, 2005
Jensen Comment: You can learn a great deal about fraud from the Association of
Certified Fraud Examiners ---
Bob Jensen's threads on fraud are at
Tips on aging wine at home: Watch your ullage
One of the big challenges for red-wine drinkers is
letting bottles age -- but not so much that they spoil. Daniel Duckhorn,
president of Duckhorn winery in Napa Valley, checks the ullage, or air space
between the bottom of the cork and the wine. Ullage increases as wines age; he
opens the wine before the ullage drops below the bottle's neck. To preserve
half-drunken bottles, some oenophiles use air pumps. But Mr. Duckhorn, who has
been making wine for 25 years, prefers another method: He pours the remaining
wine into a smaller bottle -- any bottle will do -- filling it right to the top.
He puts a cap on it and sticks it in the refrigerator, which gives the wine a
few extra days of life.
Joshua Lipton, "Winemaker's Bottle Tips," The Wall Street Journal, May 4,
2005; Page D1 ---
|Will it finally be
goodbye to your incomprehensible phone bills?
More recently, Internet phone
technology - also known as voice over Internet protocol, or
made inroads into businesses using heavy-duty equipment from
Cisco.Now, thanks to providers like
Vonage and others, it has found its way into the home. The
service is sometimes choppy, but costs are low and quality is
satisfactory for routine calls. Moreover, Internet protocol
lends itself to inexpensive videoconferencing as well, useful
for informal video chats between friends or business
associates.For those with high-speed connections, Internet
calling and videoconferencing are finally taking off. And as
their use grows, so does the selection of tools. The latest
Apple operating system, released last week, incorporates
improved tools for online video chatting. And this week a new
Motorola, the Ojo, offers Internet
picture-phone ability without a computer.
Daniel Terdiman, "Internet Phones Arrive at Home (and Some Need
No Computer)," The New York Times, May 5, 2005 ---
Here's one downside of Internet telephones (VoIP) I just
bet you never thought about
The problem? Emergency 911 services are
based on land-line technology that tells dispatchers where
you're calling from, but VoIP technology is essentially blind to
your geographical location and has to jump through hoops to find
your local emergency grid. (For similar reasons, new wireless
phones are required to have GPS locators in them.) This first
made national headlines last month when the Houston Chronicle
reported the case of city resident Joyce John, who tried and
failed to get 911 on Vonage when two men shot her parents in an
apparent home invasion. That case prompted a lawsuit from Texas
Attorney General Greg Abbott (R).
Robert MacMillen, "VoIP Users Taking 911 Off the Map,"
Washington Post, March 5, 2005 ---
Did the Chinese beat Columbus to America? Should our annual holiday
be changed to Zheng Day?
Few history theories stir as much controversy as
Gavin Menzies' idea that a legendary Chinese admiral discovered America, seven
decades before European explorer Christopher Columbus. Menzies, author of the
bestseller 1421: the Year China Discovered America, says Admiral Zheng He led a
fleet of 30,000 men on board 300 ships to the American continent in the 15th
century to expand China's influence during the Ming dynasty. Zheng, says Menzies,
drew up maps later used by Columbus to reach America in 1492 while searching for
a new route to India. Portuguese explorer Ferdinand Magellan also sailed with
the help of Chinese-drawn maps in the 16th century, he adds.
"Did the Chinese discover America?" Aljazeera, May 4, 2005 ---
Two new novels about China ---
More harm than good in war on malaria?
About 350 million to 500 million people in more than
100 countries each year catch the disease, which can kill in hours, the World
Health Organisation (WHO) and UN Children's Fund (Unicef) said in Tuesday's
World Malaria Report 2005. Billed as the first global report, it follows a
scathing editorial in The Lancet medical journal last month accusing an
international partnership of more than 90 organisations and countries of failing
to control malaria, saying they might have done more harm than good.
"Malaria fight faces hurdles in Africa," Aljazeera, May 4, 2005 ---
Walt Mossberg's tips on photo album viewing in "books"
Of course you can easily view your pictures in a slide
show on a computer screen, or even on some iPod models. But for those who miss
the feel of the old photo albums, there's a software product that aims to be the
digital equivalent: FlipAlbum 6 Suite, by E-Book Systems. This $70 program
offers a way to organize your photos into digital albums that look like actual
books, with three-dimensional flipping pages and page-shuffling sound effects to
accompany each flip. These albums can display your photos in various layouts,
with annotations below each image, and you can set music to play along with your
pictures. You can post your finished albums to the Web, email links to the Web
site, or burn them to CD or DVD. My assistant Katie Boehret and I tested this
software and found it to be a rather simple way to create attractive albums
filled with digital photos. But the options for sharing your photo album,
especially by burning it to a disc, were clumsy, limited and a little too techie
for normal users. Katie used the software's three-step FlipAlbum Wizard to start
her first album, which contained photos from a summer vacation with friends.
This wizard instructed her to open the folder or album containing the photos
that she wanted to use, and then to choose a page layout. She chose to show
single photos on each page; the only other option the wizard offers is to
display one image across both pages, centerfold-style. In step three, Katie
chose "Vacation-Travel" as the book's theme from a list of 21 options --
including "Baby-Boy," "Family Moments" and "Dog" -- that dictate the "cover"
design and certain organizational features.
Walter Mossberg, "Flipping Through a Virtual Photo Album: Software Lets
Users Create Electronic Scrapbooks; Tweaking the Page Layouts," The Wall
Street Journal, May 4, 2005; Page D4 ---
Consumer Reports discloses reversed crash test ratings on some automobiles
Consumer Reports, whose auto ratings influence vehicle
sales and resale prices, reinstated its recommendations on seven models it had
pulled two months ago, and is changing the way it rates cars. The magazine,
published by the nonprofit Consumers Union, will add a second level to how it
recommends vehicles based solely on how they perform in crash tests conducted by
the Insurance Institute for Highway Safety, the research arm of auto insurers.
Two months ago, the magazine reversed itself on seven vehicles that it had just
recommended in the annual April auto issue that was about to hit newsstands. The
reason: side-impact crash test results from the Insurance Institute that came
out the same weekend that Consumer Reports was releasing its new car
recommendations. Of the 16 small cars tested in the institute's new round of
tests, 14 of them failed, scoring the lowest "poor" rating.
Karen Lundegaard, "Consumer Reports Reinstates Recommendations It Had Pulled,"
The Wall Street Journal, May 4, 2005; Page D4 ---
One of the main reasons Bob Jensen chose to specialize in
accounting for derivatives
Derivatives: Potential Benefits and Risk-Management
Perhaps the clearest evidence of the perceived
benefits that derivatives have provided is their continued spectacular growth.
As a consequence of the increasing demand for these products, the size of the
global OTC derivatives markets, according to the Bank for International
Settlements (BIS), reached a notional principal value of $220 trillion in June
2004. Indeed, the growth rate of the OTC markets was more rapid in 2001-04 than
over the previous three years. At the same time, the growth rate of
exchange-traded derivatives exceeded the growth rate of OTC derivatives over
2001-04. Throughout the 1990s, the Chicago futures and options exchanges debated
whether the growth of the OTC markets was good or bad for their markets. The
data seem to have resolved that debate. In the United States, the Commodity
Futures Modernization Act of 2000 has permitted healthy competition between the
exchanges and the OTC markets, and both sets of markets are reaping the
benefits. The benefits are not limited to those that use derivatives. The use of
a growing array of derivatives and the related application of more-sophisticated
approaches to measuring and managing risk are key factors underpinning the
greater resilience of our largest financial institutions, which was so evident
during the credit cycle of 2001-02 and which seems to have persisted.
Derivatives have permitted the unbundling of financial risks. Because risks can
be unbundled, individual financial instruments now can be analyzed in terms of
their common underlying risk factors, and risks can be managed on a portfolio
basis. Partly because of the proposed Basel II capital requirements, the
sophisticated risk-management approaches that derivatives have facilitated are
being employed more widely and systematically in the banking and financial
"Remarks by Chairman Alan Greenspan Risk Transfer and Financial Stability To the
Federal Reserve Bank of Chicago's Forty-first Annual Conference on Bank
Structure, Chicago, Illinois," May 5, 2005 ---
Bob Jensen's multimedia tutorials on how to accounting for
derivative financial instruments are at
The rules for accounting for derivatives are a mess. Much rework needs to be
done, especially in accounting for macro hedges.
Federal Reserve Chairman Alan Greenspan
issued a fresh call on Thursday for Congress to limit the multibillion-dollar
holdings of the mortgage giants Fannie Mae and Freddie Mac, warning that their
huge debt could hurt U.S. financial markets.
"Greenspan Warns on Fannie and Freddie Again." The New York Times, May 5,
I hesitated to ask what human behavior one might look for in a
mouse (then I thought of
In January, an informal ethics committee at Stanford
University endorsed a proposal to create mice with brains nearly completely made
of human brain cells. Stem cell scientist Irving Weissman said his experiment
could provide unparalleled insight into how the human brain develops and how
degenerative brain diseases like Parkinson's progress. Stanford law professor
Hank Greely, who chaired the ethics committee, said the board was satisfied that
the size and shape of the mouse brain would prevent the human cells from
creating any traits of humanity. Just in case, Greely said, the committee
recommended closely monitoring the mice's behavior and immediately killing any
that display human-like behavior.
Opinion Journal, May 2, 2005
An appellate court struck down
FCC rules that require makers of TV sets to equip them with a "broadcast
flag," technology that prevents digital signals from being copied more than
one time.For more information, see:
Unless the Supreme Court decides
otherwise, this negates the following module:
You need to know this: How will "being flagged" possibly change your
Aiming to prevent mass piracy of digital TV
programs, especially over the Internet, the Federal Communications Commission
has mandated a new copy-protection scheme called the "broadcast flag." The FCC's
ruling, which goes into effect this July, lets you make a backup copy of flagged
shows, but no further copies. The flag will be attached to "over the air"
digital content--both network and local station programs, such as movies or
prime-time series on NBC. Any device with a digital TV tuner can grab that
content, whether it comes over an antenna or through a cable or satellite
set-top box. The flag, basically a piece of code, will travel with any show that
the broadcaster wants to protect.
"TV Limits Copies The FCC's new broadcast flag will restrict your ability to
copy and share your favorite digital television shows and movies" PC World,
June 2005 ---
Which welfare state will be the first to buckle under the strain of the
pension and medical costs?
Who knew? Speculation about which welfare state will be
the first to buckle under the strain of the pension and medical costs of aging
populations usually focuses on European nations with declining birth rates and
aging populations. Who knew the first to buckle would be General Motors, with
Ford not far behind? GM is a car and truck company -- for the 74th consecutive
year, the world's largest -- and has revenues greater than Arizona's gross state
product. But GM's stock price is down 45% since a year ago; its market
capitalization is smaller than Harley Davidson's. This is partly because GM is a
welfare state. In 2003 GM's pension fund needed an infusion from the largest
corporate debt offering in history. And the cost of providing health coverage
for 1.1 million GM workers, retirees and dependents is estimated to be $5.6
billion this year. Their coverage is enviable -- at most, small co-payments for
visits to doctors and for pharmaceuticals, but no deductibles or monthly
premiums. GM says health expenditures -- $1,525 per car produced; there is more
health care than steel in a GM vehicle's price tag -- are one of the main
reasons it lost $1.1 billion in the first quarter of 2005. Ford's profits fell
38%, and although Ford had forecast 2005 profits of $1.4 billion to $1.7
billion, it now probably will have a year's loss of $100 million to $200
million. All this while Toyota's sales are up 23% this year and Americans are
buying cars and light trucks at a rate that would produce 2005 sales almost
equal to the record of 17.4 million in 2000.
George Will, "GM Unwound, The Wall Street Journal, May 2, 2005 ---
You can read a Wharton School take ("Car Trouble: Should We Recall the
U.S. Auto Industry?") on this at
Do you suppose taxpayers will also have to pick up GM's pension expenses?
Doomsday precedent: Give workers retirement plans and then pawn them off for
taxpayers to pay the pensions. Passing along these kinds of entitlements to
taxpayers is another nail in the coffin of the United States.
"UAL (that's United Airlines) Reaches Pact To Hand Over Pensions to U.S.," by
Susan Carey, The Wall Street Journal, April 25, 2005; Page A2 ---
Which major food industry will be the next to cave in due to
New talks begin in Canada this week aimed at rescuing
the world's fragile fish stocks. The simplest solution is tougher rules limiting
fishing—but politicians have a way of caving to fishing lobbies.
"The tragedy of the commons, contd," The Economist, May 2, 2005 ---
And we thought Yao Ming (Houston Rockets) was big:
Adultery with a ten-foot tall woman
Meng Zhaoguo, a rural worker from
northeast China's Wuchang city, says he was 29 years old when he
broke his marital vows for the first and only time -- with a
female extraterrestrial of unusually robust build. "She was
three meters (10 feet) tall and had six fingers, but otherwise
she looked completely like a human," he says of his close
encounter with an alien species. "I told my wife all about it
afterwards. She wasn't too angry." While few Chinese claim to
have managed to get quite as intimate with an extraterrestrial
as Meng, a growing number of people in the world's most populous
nation believe in unidentified flying objects, or UFOs.
"Close encounters on rise as UFOs seize imagination of Chinese,"
s, May 3, 2005 ---
The new writing tests that have been added to both the SAT
and the ACT
A. Are unlikely to predict success in college writing.
B. Will send high school writing instruction in the wrong
C. Reward those who write “conventional truisms and
platitudes about life.”
D. All of the above.
Answer according to the National Council of Teachers of English,
the answer is D. The council released an
analysis of the new writing tests Tuesday, and it found
little to like and much to dislike ---
Every college is a success if there are enough criteria in
the performance measurement system
In response to this political pressure, and to
accommodate the many different kinds, types and characteristics of institutions,
the accountability system usually ends up with 20, 30 or more accountability
measures. No institution will do well on all of them, and every institution will
do well on many of them, so in the end, all institutions will qualify as
reasonably effective to very effective, and all will remain funded more or less
as before. The lifecycle of this process is quite long and provides considerable
opportunity for impassioned rhetoric about how well individual institutions
serve their students and communities, how effective the research programs are in
enhancing economic development, how valuable the public service activities
enhance the state, and so on. At the end, when most participants have exhausted
their energy and rhetoric, and when the accountability system has achieved
stasis, everyone will declare a victory and the accountability impulse will go
dormant for several years until rediscovered again.
John V. Lombardi, "Accountability, Improvement and Money," Inside Higher Ed,
May 3, 2005 ---
It's not surprising that male-bashing, that popular
sport encouraged by everyone from outraged-at-the-president-of-Harvard audiences
to Madison Avenue ad shops, has wormed its way down to the
pre-pubescent/early-teen demographic ("Moving On: Girl Power as Boy Bashing,"
Personal Journal, April 21). What is surprising is the complete lack of outrage
from men. As I was subjected to another in the endless string of
men-as-complete-idiots television ads the other night, I commented to my wife
that if an ad were similarly insulting to women, the hue and cry from the
women's rights bunch would be deafening. As I pointed out, you never see a "Mom
made the bathroom smell" ad. If we did, it would be the end of civilization as
we know it.
Whit Sibley, "American Men Just Shrug as They Take a Bashing," The Wall
Street Journal, May 4, 2005 ---
were raised in Australia
Crotch shot has blokes fuming at sexist ads. A bureau statistician, Neale Apps,
was at a loss to explain why Australian men had finally found their voice. "I
can only think that they are no longer embarrassed about complaining," he said.
Mr Apps noted that some ads attracted twice as many complaints from men as
Julian Lee, Sydney Morning Herald, January 3, 2004 ---
similar criticisms of U.S. television and newspaper bias against men.
The New York Times
has been "breeding contempt for men" ---
A controversial book by
Warren Farrell entitled Why Men Earn More uses government wage data to
show that the " pay gap” has become an ideological myth. His latest
controversial book is called The Myth of Male Power ---
Life in the Fast Lane of Auditing
"Take This Job and ... File It: Burdened by Extra
Work Created By the Sarbanes-Oxley Act, CPAs Leave the Big Four for Better
Life," by Diya Gullapalli, The Wall Street Journal, May 4, 2005; Page C1
The Big Four accounting firms also face extra work
created by the 2002 Sarbanes-Oxley securities-overhaul act, passed in the
wake of the blowups at Enron Corp. and WorldCom (now MCI Inc.). At the same
time, the pressure to get the job done right also comes from within: Faced
with mounting litigation from the accounting debacles of earlier this
decade, the Big Four can't afford many more mistakes.
Junior auditors, with three to five years'
experience, long have done much of the grunt work in auditing publicly
traded companies. They have always had the highest turnover at accounting
firms -- as many as one in four quits annually at PricewaterhouseCoopers,
according to a recent study it commissioned. Overall, nearly one in five
accountants at large CPA firms left in 2003, up from 17% in 2002, according
to the American Institute of Certified Public Accountants. The AICPA expects
that trend to continue this year.
To combat the problem, the Big Four are trying to
move from a culture of overloading and underpaying youngsters to nurturing
and better rewarding them.
They are hiring larger numbers of them, and
offering bigger bonuses, more vacation and special referral fees. Ernst &
Young LLP has started a concierge service to make restaurant reservations
and pick up dry cleaning. Deloitte & Touche LLP holds "town hall meetings"
to let junior employees vent gripes to senior partners. The big firms are
more aggressive in dropping or turning down business, to hold down the
workload, and they are pulling older staff from other departments, like
tax-services, to help out.
"The profession has recognized that we have a lot
of stress in the system, and we're doing a lot of things to execute against
that," says Bob Moritz, a senior partner at PricewaterhouseCoopers.
"Does this model still work?" asks Jim Walsh, a
human-resources managing director for the firm. "It's a good question" that
is under review there.
College does not prepare for real life
Perhaps we should stop and consider that a four-year
college right out of high school isn't the right choice for everyone. Perhaps
college isn't the place to "find yourself", especially to the tune of over 15
grand a year. A third of college students do not qualify for a degree in six
years and just because you don't graduate, doesn't mean you don't have to pay
back student loans. Since when is a college degree all that counts in the job
market? The U.S. Bureau of Labor and Statistics' estimates of the
fastest-growing occupations between 2002 and 2012 show that six of the top 10
don't require bachelor's degrees. On the job training, vocational and technical
degrees can lead to successful careers. Let's face it, for many occupations, a
year of on the job training would prepare you much better then wading through
philosophy, ethnic studies, astronomy and all those other gen eds that bog down
students and stretch out our education to four years and beyond. Admittedly,
much of the college education process is a product of our societal conceptions
of what determines success and job preparedness. It is also a great ploy by the
universities to reel in those middle class baby boomer dollars by convincing mom
and dad that a pricey degree is the only thing separating their baby from comfy
suburban bliss and destitution.
Amanda Hooper, "College does not prepare for real life," Bowling Green News,
May 2, 2005 ---
Monumental documentary the People's Century that spans 26
People's Century is a monumental documentary series describing the 20th century.
It was first shown on the BBC in 1999. It is a 26 part documentary each spanning
one hour dealing with the major socio-economic, political climate and cultural
movements that shaped the 20th century ---
Bob Jensen's history bookmarks are at
A million here, a million there: In college athletics
it's real cash
While critics of big-time sports might look at the
growing subsidies and see a runaway train, the NCAA’s president, Myles Brand,
put a positive spin on the finding that colleges increased what they spent to
subsidize sports programs. “Leaders at our member institutions determine the
value athletics brings to their campus communities and fund it accordingly,”
Brand said in a
news release accompanying the report
Doug Lederman, "Sports, Spending and Subsidies," Inside Higher Ed, May 4,
A billion here, a billion there: In accounting it is
sometimes only on paper and not real cash
The American International Group, the embattled
insurance giant, said last night that an in-depth examination of its operations
had turned up additional accounting improprieties going back to 2000 that would
reduce its net worth by $2.7 billion, or $1 billion more than it had previously
Gretchen Morgenson, "Giant Insurer Finds $1 Billion More in Flaws, The New
York Times, May 2, 2005 ---
Also see the NYT article ---
Bob Jensen's updates on fraud in general are at
Bob Jensen's updates on fraud in the insurance industry are at
May 2, 2005 message from the former Chairman of the Financial
Accounting Standards Board (Dennis Beresford)
If you haven't seen it already, today's Wall Street
Journal includes an article about AIG's further accounting issues. Included
is a link to the Company's statement on all of the various issues they have
identified so far:
Some of the new problems identified relate to
accounting for derivatives. It appears, among other things, that the Company
now believes it did not meet the criteria for hedge accounting and will have
to record a $2.4 billion gain in income rather than deferring the effect. Of
course, that will lead to an offsetting effect in a later year when the
"hedged item" occurs.
Following in the footsteps of Fannie Mae and
Freddie Mac, AIG's statement about derivatives makes me wonder how many
other large, complicated companies would find deficiencies in their
accounting for derivatives if they were forced to have a critical outsider
challenge what they are doing.
May 2, 2005 reply from Bob Jensen
I did catch this one. What still gets to me is the fact that many of the
fluctuations in the value of derivatives that don't qualify for hedge
accounting (usually due to macro hedging) really are never realized in
fluctuations in cash flows. I tend to sympathize with Fannie on this and
hope that the FASB will eventually revise the standard on macro hedging.
What do we have auditors for?
Still, "at a certain point, if auditors can only find
out about [improper accounting] if
management tells them about it, then what do we have auditors for?" said Lynn E.
Turner, a former SEC chief accountant and managing director of research for
proxy-advisory concern Glass Lewis & Co. "The reason we have auditors is to give
investors confidence that an outside third party has looked at them and found
things that might turn out to be big errors."
Theo Francis and Diya Gullapalli, "Pricewaterhouse's Squeeze Play: AIG
Says It Misled Auditor, As Greenberg Cites Review Clearing Internal Controls,"
The Wall Street Journal, May 3, 2005, Page C3 ---
Bob Jensen's threads on PwC are at
Here's another example of how to mislead with statistics
"One measure of how children have tumbled as a
priority in America is that in 1960 we ranked 12th in infant mortality among
nations in the world, while now 40 nations have infant mortality rates better
than ours or equal to it," writes Nicholas Kristof in yesterday's New York
Times. We explained in January http://www.opinionjournal.com/best/?id=110006153
why these numbers are meaningless: In brief, American physicians make heroic
efforts to save low-birthweight and premature babies, whom other countries don't
even count as having been born.
Opinion Journal, May 2, 2005
Desk-top fusion may be possible after all
Physicists who meddle with cold fusion, like
psychologists who dabble in the paranormal, are likely to be labelled quacks by
their peers. This is due to an infamous incident in 1989 when Stanley Pons and
Martin Fleischmann held a press conference to announce their discovery of
nuclear fusion in what amounted to a test-tube full of water connected to a
battery. In particular, they said that they were getting more energy out of the
process than they put into it. Their result was instantly dubbed “cold fusion”,
to contrast it with giant fusion-reactor experiments that attempt to reproduce
the ultra-high temperatures found inside the sun. But when it failed to stand up
to scrutiny, confusion—and eventually outrage—ensued. In 2002, history repeated
itself as farce with the announcement by a group at Oak Ridge National
Laboratory in Tennessee of fusion inside the bubbles that are produced by
ultrasonic waves travelling through a liquid. This result passed the peer-review
process, but was immediately attacked by another group—from the same
laboratory—which claimed to find no such effect. There was a counterclaim by yet
a third team last year, and a final verdict on “bubble fusion” is still not in.
But most people have lost interest in the debate, assuming that anyone claiming
to have observed fusion in a desktop experiment is a crank or a fraud. This
attitude, however, may yet turn out to be mistaken. Desk-top fusion may be
possible after all, according to an article published in this week's Nature by
three researchers at the University of California, Los Angeles (UCLA). Brian
Naranjo, Jim Gimzewski and Seth Putterman have been meticulous in their
experiment, and in particular in their measurement of one of the tell-tales of
nuclear fusion, the production of neutrons. Their results have been
peer-reviewed, and they make no wild claims of surplus energy being produced.
Given past excesses, such caution is understandable. And it may indeed be the
case that their technique, which involves banging together the nuclei of
deuterium atoms (a heavy form of hydrogen) using a tiny crystal in a palm-sized
vacuum chamber, will never provide a source of power. It could have some
interesting applications, nonetheless.
"Honest!" The Economist, April 28, 2005 ---
It was the largest fine ever imposed on an auditing firm
Deloitte & Touche LLP incurred the wrath of federal
regulators Tuesday over public statements that appeared to shift the blame away
from the auditing firm for failed audits of Adelphia Communications Corp. and
Just for Feet Inc. Deborah Harrington, a Deloitte spokeswoman, said regulators
requested that the firm revise the first press release it put out. The second
release omitted some disputed statements. Deloitte, the U.S. accounting branch
of Big Four accounting firm Deloitte Touche Tohmatsu, Tuesday agreed to pay $50
million to settle charges by the Securities and Exchange Commission that it
failed to detect fraud at Adelphia. It was the largest fine ever imposed on an
"SEC Rebukes Deloitte on Adelphia Audit Spin," SmartPros, April 28, 2005
The largest bankruptcy case in the history of the world
Question What CPA auditing firm has the dubious honor of having been the
auditor for the company that is now designated as the largest bankruptcy case in
the history of the world?
Answer Deloitte Touche Tomatsu
Deloitte faces a potential $2 billion legal claim over audits of Forest Re, an
aviation reinsurer that failed after 2001's terror attacks.
Bob Jensen's threads on Deloitte's legal woes are at
Enhance your PowerPoint shows
From the T.H.E. Newsletter on May 4, 2005
CrystalGraphics Inc., a
developer and publisher of add-on products for Microsoft Office, has
released PowerPlugs: Video Backgrounds Player and PowerPlugs: Video
Backgrounds Content . The Video Backgrounds Player is a unique software
product that plugs directly into Microsoft PowerPoint allowing users to
select and insert full-screen moving backgrounds into their presentations
quickly and effortlessly. It is also compatible with all of PowerPoint's
animation tools and text-editing capabilities. Video Backgrounds Content is
the perfect complement to the Video Backgrounds Player software. It features
nine volumes that each include 25 unique background video clips optimized
for use with PowerPoint so they can play back smoothly in real time on most
Pentium III or higher PCs. The footage is royalty free, so you can use it as
many times as you like in your presentations with no added cost.
For more, visit
Bob Jensen's threads on resources are at
A New Photoshop Makes Retouching Reality (Somewhat)
Adobe Photoshop, of course, is the world's most popular
photo-editing software (for Mac and Windows). Every time a magazine pastes a
movie star's head onto a different body for its cover, you can bet that
Photoshop was involved. Such digital manipulation is so common that "Photoshop"
has become a verb: "My ex-husband was on that trip, too, but I've Photoshopped
him out of this shot." But even when no movie stars are decapitated, Photoshop's
magic is at work all around you. Photoshop color-corrects, brightens, darkens,
crops, sharpens or airbrushes imperfections from a huge percentage of the
photographs you see every day, whether in ads, articles, movies or CD's, on Web
sites or the covers of books. No wonder, then, that when Adobe releases a new
version, as it did last week, photographers and designers sit up and take
David Pogue, "A New Photoshop Makes Retouching Reality (Somewhat) Easier,"
The New York Times, May 5, 2005 ---
Real Networks' Rhapsody 3.0
In addition to a new user interface, the ability to
manage music stored on your hard drive, and an offer that gives new subscribers
25 free streams per month, Rhapsody also boasts an important feature:
subscription portability. This allows Rhapsody users (those willing to pay $15
per month, as opposed to the basic $10 per month fee) to move as many of the
more than 1,000,000 subscription songs to their digital music players as will
fit. But not every digital music device will play Rhapsody To Go music. In fact,
very few will. In the best of circumstances, explaining this key fact to
subscribers is a difficult task. When subscribers are angry and feel misled, the
difficulty is compounded. Already, Real is facing a backlash on its message
boards from angry consumers who believed the "To Go" plan meant they could port
songs to their iPods -- something that is not allowed. Consumers were confused,
it seems, by the fact that non-subscription downloads purchased from Rhapsody
can be played on iPods, whereas subscription-based streaming songs cannot be
moved to iPods.
Eric Hellweg, "You Can (Almost) Take it With," MIT's Technology Review,
May 2, 2005 ---
From Jim Mahar's blog
Transfer Pricing A cool article on transfer
pricing--no it is not an oxymoron!
Reichelstein, Baldenius, and Melumad look at
transfer prices and remind us that transfer pricing, the price that firms
charge for internal "purchases", is a balancing act between tax reduction
strategies, internal controls, and incentives.
“What most people think about is transfer pricing
as a tax optimization issue,” Reichelstein says. “Yet, transfer prices are
management tools. They have an important function to facilitate
decision-making, to tell certain regional or country managers what the value
or price of some intermediate product is and use that information to
maximize the profit of the company as a whole. That is the economic function
of transfer pricing.”"
"The separate worlds of tax folk and management
planning types “even splits the accountants,” he notes, and creates separate
industries. “The tax accountants look on pricing as entirely a compliance
issue,” he says. Meanwhile, management accounting consultants are
preoccupied with transfer prices for both internal allocations and public
reporting purposes." Very interesting! However, I am a bit less convinced
that a weighted average solution is optimal, but hey, that is rather
insignificant in the big picture.
Thanks to MBA Depot for pointing this one out to
A Stanford University GSB alumni review is provided at
Wikipedia is a real-life Hitchhiker's Guide
It's too bad Douglas Adams wasn't
able to see his vision brought to life. I don't mean the
of The Hitchhiker's
Guide to the Galaxy. I'm talking about
Wikipedia, the Web's own
don't-panic guide to everything. The parallels between
The Hitchhiker's Guide (as found in Adams'
BBC radio series and
novels) and Wikipedia are so
striking, it's a wonder that the author's rabid fans don't
think he invented time travel. Since its editor was
perennially out to lunch, the Guide was
amended "by any passing stranger who happened to wander into
the empty offices on an afternoon and saw something worth
doing." This anonymous group effort ends up outselling
Encyclopedia Galactica even though "it has many
omissions and contains much that is apocryphal, or at least
Paul Boutin, "Wikipedia is a real-life Hitchhiker's Guide:
huge, nerdy, and imprecise," Slate, May 3, 2005 ---
The link to Wikipedia is
Those of you that were thrilled to learn that the ivory-billed woodpecker really
is not extinct (as was previously thought) may want to learn more about this
rare bird at
Also note the new entry for the Iceland Hotspot ---
Give us your best or give us your poor and minorities, that is the
question big state universities face
Since he was hired to lead the University of
Massachusetts flagship campus three years ago, John V. Lombardi has been busy
laying plans to improve the university. He has expanded private fund-raising and
plans to rebuild much of the campus. By boosting recruitment, he has increased
the applicant pool by nearly 25 percent in hope of attracting more
high-achieving students . . . Convinced they must act now or watch their public
university drift from its mission, Bustamante and a small, tight-knit group of
student leaders have launched a formal campaign, Take Back UMass, to ''return
UMass to its legacy as an accessible and diverse public university," according
to the group's website. This year, instead of working with administrators as is
typical on many campuses, the UMass student government has staged a half-dozen
noisy demonstrations to demand more diversity on campus and more support for
minority students. Minority enrollment, which peaked in the mid-1990s, dropped
off at the end of the decade and has been mostly flat since then. Students have
blitzed legislators with angry letters and phone calls, and they organized a
boycott of classes last month to protest a restructuring of student services.
Jenna Russell, "Students say UMass being too selective Goals at Amherst spur
strong debate," Boston Globe, May 5, 2005 ---
In Australia's case, the situation is made even worse
by the antics of freed Italian hostage Giuliana Sgrena. Ms. Sgrena, its worth
recalling, is the left-wing journalist who sympathized with her kidnappers. She
also lied about the speed of the car she was traveling in when American soldiers
opened fire as it sped toward a nighttime roadblock, accidentally killing an
Italian secret service officer accompanying her. Now Ms. Sgrena is doing the
terrorist's dirty work again, urging ordinary Australians to respond to the Wood
kidnapping by launching a campaign to bring their forces home from Iraq. But
Australians seem to be made of sterner stuff. While some Filipinos protested to
pressure Ms. Arroyo into giving way last summer, Australians don't appear to be
following that example, or Ms. Sgrena's advice. In a general election seven
months ago, they decisively rejected the troops-out option then championed by
the opposition Labor Party, instead returning the government of Prime Minister
John Howard with an increased majority. During the present crisis, not even
Labor, now under the leadership of experienced statesman Kim Beazley, is
advocating bringing the troops home or paying a ransom.
"Australian Resolve," The Wall Street Journal, May 5, 2005 ---
No more "best" students: Many more seniors to get top honors
Over the years, Saratoga High School has tried to
curb its competitive culture. The school does not publish an honor roll. It has
slashed homework over breaks. It releases grade-point averages to students only
on request. Yet, teachers say, too many students remain obsessed with their
grades. So in another attempt to ease the pressure, Saratoga High announced it
would change the way it chooses class valedictorians and salutatorians to allow
more students to be honored. The announcement kicked off a furor in this
affluent, well-educated community, with many fearful the school's highest
achievers would be robbed of their due.
"Saratoga High trying to ease grade pressure (Educrat dumbing-down education
alert!), San Jose Mercury News, May 4, 2005 ---
How bad must it get before Germany gets a wake up call?
Franz Müntefering, chairman of the Social Democratic
Party, stoked resentments in a bitter attack on private investors in German
companies . . . German industrialists, academics and other politicians have
roundly criticized Mr. Müntefering's attack, which seems calculated to shore up
the leftist base of the Social Democrats before a crucial election on May 22 in
North Rhine-Westphalia, a large and an economically troubled state. A prominent
German-Jewish historian, Michael Wolffsohn, even detected a whiff of anti-Jewish
sentiment in the list, which also included Blackstone, the New York private
equity investment group, and Saban Capital, which is controlled by the
Israeli-American billionaire, Haim Saban. Mr. Schröder has not joined in such
attacks, and Social Democratic officials in North Rhine-Westphalia said it made
no sense to put Wincor Nixdorf on a list of supposed victims.
Mark Landler, "Report to German Ruling Party Faults Overseas Investors," The
New York Times, May 5, 2005 ---
The debate raging in Germany is about whether the
country is quite ready for this kind of capitalism rather than the more socially
oriented Rhineland variety that is ailing, but not quite buried. Mr Müntefering
is clear where he stands: “We want social market economy, not market economy
pure.” But despite the populist bent to his rhetoric, not everyone supports his
stance. Attending a rally on May 1st he was ritually pelted with eggs by trade
unionists who are supposed to be his friends. Many people have told him in the
past three weeks that what he wants just will not work any more, and that
opportunistic foreign investors, far from being locusts, can be the reformer’s
"Some German politicians want to blame international business and finance, not
themselves, for the country’s sluggish economy," The Economist ---
The explosions came after this "suspicious item" was eaten
A concerned citizen spotted a male juvenile carrying a
suspiciously concealed item into Marshall Junior High School early Thursday
morning. Police were called. The school was locked down. Adjacent streets were
closed and law officers were perched on roofs with weapons. The drama ended
about two hours later when the suspicious item was identified: A 30-inch
burrito, prepared as an extra-credit assignment and wrapped inside tinfoil and a
white T-shirt. "I didn't know whether to laugh or cry," school Principal Diana
Russell said after the mystery was solved.
Opinion Journal, May 2, 2005
Charles Colson (remember him?) questions: "Does sex sell?"
The Reuters news service has looked into recent
box-office numbers and come up with some intriguing results: Movies rated R for
explicit sexual content do poorly in theaters. Their report states, “Last year,
five of the top-10-grossing movies were PG. Of the top 25, only four were rated
R. ‘Increasingly, if a movie is rated R,’ says producer John Goldwyn, ‘audiences
won’t go.’” Movies advertised as being all about sex, like Closer and Kinsey,
got great reviews, but they failed miserably at the box office. And last year
was no anomaly. In his book Hollywood vs. America, Michael Medved tracked poor
audience numbers for sexually explicit films all the way back to the sixties.
Based on its own research, Reuters concluded, “The old adage ‘sex sells’ no
longer applies to the movies. . . . As any theater owner will eagerly tell you,
American audiences like their movies PG and PG-13, not R, and certainly not
NC-17.” Yet we need to be careful not to read too much into these results,
because the news isn’t all good. For one thing, neither PG nor PG-13 means what
it used to anymore. There’s a lot more today that slips past the ratings board
than ever before. While hardcore sex may not be selling, “vulgar, dumb, funny
sex,” as Reuters puts it, is selling just fine, and to ever-younger audiences.
Producer Peter Guber echoed Reuters’s thesis when he explained, “Sex inside a
comedy candy-coats sex and allows the audience to feel comfortable. . . . Films
can be sexy, but they can’t portray the [real] sexual intimacy most people
[genuinely] crave. . . . The portrayal has to be violent or funny.”
Charles Colson, "Does Sex Sell? You Might Be Surprised," Prison Sell, May
2, 2005 ---
Happy Mother's Day
Somebody said it takes about six weeks to get back to normal after you've had
a baby ........
Somebody doesn't know that once you're a mother, "Normal," is history.
Somebody said you learn how to be a mother by instinct ...
Somebody never took a three-year-old shopping.
Somebody said being a mother is boring ! ......
Somebody never rode in a car driven by a teenager with a driver's permit.
Somebody said if you're a "good" mother, your child will "turn out good."
Somebody thinks a child comes with directions and a guarantee.
Somebody said "good" mothers never raise their voices .....
Somebody never came out the back door just in time to see her child hit a
golf ball through the neighbor's kitchen window.
Somebody said you don't need an education to be a mother.
Somebody never helped a fourth grader with her math.
Somebody said you can't love the fifth child as much as you love the first.
Somebody doesn't have five children.
Somebody said a mother can find all the answers to her child-rearing
questions in the books .....
Somebody never had a child stuff beans up his nose or in his ears.
Somebody said the hardest part of being a mother is labor and delivery ...
Somebody never watched her "baby" get on the bus for the first day of
or on a plane headed for military "boot camp."
Somebody said a mother can do her job with her eyes closed and one hand tied
behind her back ....
somebody never organized four giggling Brownies to sell cookies.
Somebody said a mother can stop worrying after her child gets married
Somebody doesn't know that marriage adds a new son or daughter-in-law to a
Somebody said a mother's job is done when her last child leaves home ....
Somebody never had grandchildren.
Somebody said your mother knows you love her, so you don't need to tell her
..... Somebody isn't a mother.
Fraud Updates ---
For earlier editions of New
s go to http://www.trinity.edu/rjensen/bookurl.htm
Archives of Tidbits: Tidbits Directory --- http://www.trinity.edu/rjensen/TidbitsDirectory.htm
here to search Bob Jensen's web site if you have key words to enter --- Search
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 http://www.searchedu.com/.
Bob Jensen's home page
is at http://www.trinity.edu/rjensen/
Professor Robert E. Jensen (Bob) http://www.trinity.edu/rjensen
H. Jones Distinguished Professor of Business Administration
University, San Antonio, TX 78212-7200
Voice: 210-999-7347 Fax:
210-999-8134 Email: firstname.lastname@example.org