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All you have to do is open the message, nothing else
Microsoft's Newest Bug Could Be Awful, Researcher Says
Forget the WMF problems; the really big issue could be with the flaw in Outlook and Exchange that Microsoft disclosed on Tuesday. All that's required to exploit this is an e-mail message.
Gregg Keizer, "Microsoft's Newest Bug Could Be Awful, Researcher Says," InformationWeek, January 11, 2006 ---  http://www.informationweek.com/story/showArticle.jhtml?sssdmh=dm4.163111&articleID=175803695

"What I find bizarre is that there's still all this focus on the WMF [Windows Metafile] bug," said Mark Litchfield, the director of NGS Software, a U.K.-based security company, and one of the two researchers credited by Microsoft with the discovery of the TNEF (Transport Neutral Encapsulation Format) vulnerability. "This one has massive financial implications if someone exploits it," Litchfield said. The TNEF vulnerability, which Microsoft spelled out in the MS06-003 security bulletin, is a flaw in how Microsoft's Outlook client and older versions of its Exchange server software decode the TNEF MIME attachment. TNEF is used by Exchange and Outlook when sending and processing messages formatted as Rich Text Format (RTF), one of the formatting choices available to Outlook users. "All that's required to exploit this is an e-mail message," said Litchfield. No user interaction is needed to compromise an Exchange 5.0, 5.5, or 2000 server; all that's necessary is to deliver a maliciously-crafted e-mail to the server. It's that characteristic, as well as the ease with which an attack could spread, that has Litchfield so worried. "You could take over an Exchange server with a single, simple e-mail," he said. "From there you could target all the clients accessing that server. You would 'own' any Outlook client that connects to that server. Then an attacker could grab the Outlook users' address books. Continued in article

"Unknown Attacks: A Clear and Growing Danger,"  by Secure Computing, InformationWeek, January 2006 --- http://snipurl.com/UnknownAttacks 

More on security threats and hoaxes --- http://www.trinity.edu/its/virus/

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"10 Critical Factors When Buying a New PC," by Fred Langa, InformationWeek January 9, 2006 --- http://snipurl.com/PCfactors
Also see http://internetweek.cmp.com/showArticle.jhtml?sssdmh=dm4.163112&articleID=175803749

Probably the most critical factor is to move to a screaming "virus and spyware free" (well almost) Mac
While Apple had no choice but to move its notebooks and Macs to Intel processors, chief executive Steve Jobs added insult to injury to recent Mac buyers in touting the superior performance of the new machines over the company's older computers. Just imagine how you'd feel if you had bought a PowerBook G4 for a couple of grand, and then found out a few weeks later that a new machine for the same price is at least four times faster. Outside of diehard Mac lovers, I'm sure some of the people contributing to Apple's strong fourth quarter are wishing they bought Windows PCs instead.
Antone Gonsalves, InformationWeek Newsletter, January 12, 2006
See http://www.internetweek.cmp.com/showArticle.jhtml?sssdmh=dm4.163112&articleId=175803746
Also see http://www.technologyreview.com/InfoTech/wtr_16141,294,p1.html

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Apple and Microsoft renew vows to keep Office (Excel, Word, PowerPoint, etc.) for Mac alive for five more years --- http://blog.wired.com/cultofmac/

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"Finding an Internet Phone Service," by Greear Cossitt, The Wall Street Journal, January 12, 2006 --- http://online.wsj.com/article/SB113701839171644121.html?mod=todays_us_personal_journal

Q: How can I find a cheap and reliable Internet phone service? A: Voice over Internet protocol services may save you money, especially if you make many long-distance calls. With VOIP, calls are routed through the Internet. Depending on the plan, you either talk through the computer with a microphone or with a regular phone, using an adapter. Some services provide the equipment free. Monthly rates can vary from free (for calls to VOIP users) to up to $50 for unlimited calling and certain features. Overseas rates may cost extra, but are generally low. The number of VOIP services is quickly expanding, but popular ones include Vonage and SunRocket, which charge $14.99 and $9.95, respectively, for a basic service plan. To help find a reliable service, you can read customer reviews at whichvoip.com and cnet.com.

 

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All those phony cough medicines:  Here's what's supposedly better

"Cold Comfort: Most Cough Medicines Don't Do a Thing -- Here's What Works," by Tara Parker Pope, The Wall Street Journal, January 10, 2006; Page D1 ---
http://online.wsj.com/article/SB113685051306442090.html?mod=todays_us_personal_journal

Every year consumers spend billions on cough medicines, but a new report from the nation's top chest doctors says many of them don't work.

The finding was issued by the American College of Chest Physicians as part of its comprehensive guidelines for dealing with various forms of cough. The doctors group reviewed numerous medical studies evaluating cough preparations and concluded that many of the key ingredients in popular cough and cold medications simply

But there was good news as well. The group concluded that the ingredients found in certain older allergy medications and pain relievers are actually far more effective against cough, even though they aren't marketed as cough treatments.

Among other findings, the group concluded that the drug guaifenesin -- an expectorant found in popular brands such as Wyeth's Robitussin and Mucinex from Adams Respiratory Therapeutics in Chester, N.J. -- is ineffective in curbing cough caused by the common cold. The drug is supposed to work by thinning the mucus and making it easier to cough up phlegm. But among four studies evaluating guaifenesin compared with a placebo, two studies showed benefit while two showed no improvement. As a result, the panel concluded there isn't enough evidence to support its use to help cough caused by colds.

Continued in article
 

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The Great Chinese Experiment China is betting its economic health on becoming a world leader in the sciences.
But will it succeed?
China is an economic catastrophe waiting to happen. China is poised to become the world's largest economy by 2025. Both these statements are true. They provide the context we must understand in order to evaluate rightly what the Chinese are attempting to do in the sciences.
Freeland Judson, "The Great Chinese Experiment China is betting its economic health on becoming a world leader in the sciences. But will it succeed?" MIT's Technology Review, December 2005/January 2006 --- http://www.technologyreview.com/BioTech/wtr_16031,306,p1.html
 

 

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Will you get hit by the Alternative Minimum Tax?
The IRS has a new AMT helper site

The AMT Assistant from the IRS --- http://apps.irs.gov/app/amt/

Bob Jensen's tax helpers are at http://www.trinity.edu/rjensen/bookbob1.htm#010304Taxation

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The Importance of Being (an) Ernest (Historian)
In a paper for a panel at the AHA meeting, Estes said that his primary goal for his students is to have them act and think like historians, not like students in a history class. In a class of 55 — many of them “skeptical or even hostile to the notion that history has value” — how can you do this? Estes argued that one way is through the syllabus, which isn’t just a list, but provides context about the course, so that students are confronted with ideas, not just information, every time they look at the document.
"The Teaching Agenda," Inside Higher Ed, January 6, 2006 --- http://www.insidehighered.com/news/2006/01/06/teaching

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Question
When was concrete first used to build harbors?

Answer
From about 3000 B.C.E., boats anchored in natural coves and bays. At Sidon, for example, the team found crustaceans typical of brackish lagoons in the cores, indicating that the bays were fairly sheltered. By about 1200 B.C.E., the Phoenicians began building artificial harbors, a period which corresponds to other archaeological evidence that ship traffic was increasing at that time. After the invention of concrete by the Romans around 300 B.C.E., sophisticated harbor engineering became possible, and the ports were at their height during the subsequent Greco-Roman and Byzantine periods, from 332 B.C.E. to about 1000 C.E. After that time, Tyre...
"Ancient Harbors Rise Again,"  By Michael Balter,  Science Magazine, January 9, 2006 --- http://sciencenow.sciencemag.org/cgi/content/full/2006/109/2

Linens, embroidery, metalwork, and ceramics--these are just some of the fine goods exported by the Phoenicians throughout the Mediterranean. The sea traders and colonizers were a major force in the ancient world from about 3000 B.C.E. to 538 B.C.E., yet their chief harbors, located at Sidon and Tyre in Lebanon, vanished from sight long ago. Now a team of geoarchaeologists claims to have discovered those key ports. The team, led by geoarchaeologists Nick Marriner and Christophe Morhange of the European Center for Research and Teaching of Environmental Geosciences in Aix-en-Provence, France, began working on the Lebanese coast in 1998. Sonar helped them find the margins of the harbors, and then deep coring unveiled the detailed life history of the ports. As the team reports in this month's issue of Geology, the harbors went through several phases.

From about 3000 B.C.E., boats anchored in natural coves and bays. At Sidon, for example, the team found crustaceans typical of brackish lagoons in the cores, indicating that the bays were fairly sheltered. By about 1200 B.C.E., the Phoenicians began building artificial harbors, a period which corresponds to other archaeological evidence that ship traffic was increasing at that time. After the invention of concrete by the Romans around 300 B.C.E., sophisticated harbor engineering became possible, and the ports were at their height during the subsequent Greco-Roman and Byzantine periods, from 332 B.C.E. to about 1000 C.E. After that time, Tyre and Sidon rapidly declined in importance, and the harbors were apparently abandoned: The coring shows that the beach began to become exposed, and the lagoon species of crustaceans gave way to species typical of unsheltered coastlines and open seas.

The Phoenicians had to work hard to keep their ports deep enough for ships to enter. In a companion study of Tyre's harbor, published in this month's issue of Quaternary Research, Marriner and Morhange report that the Phoenicians extensively dredged this port during the Greco-Roman and Byzantine periods. The dredging kept it from silting up as a result of intensified agriculture and construction on the mainland that caused greater soil erosion and runoff of sediments, especially in the Litani River. Even more silting, the researchers point out, was caused by the practice of using the harbor as a huge waste dump.

Continued in article

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Biotechnology:  What is too much of a seemingly good thing?

"Soul Man:  Leon Kass sounds a warning about the perils of biotechnology," by Bret Stephens , The Wall Street Journal, January 7, 2006 --- http://www.opinionjournal.com/editorial/feature.html?id=110007782

But for Dr. Kass, the problem hardly ends there. "Let's assume," he proposes, "that you found some kind of steroid that was safe and produced no bad aftereffects. (Unlikely, but.) Let's assume they were legal. Let's assume everybody used it. I think the athletes would still be ashamed to be seen shooting up before they went to bat. "That has something to do with the fact that what the activity purports to be is an activity of natural human gifts suitably cultivated by practice and effort. . . . I think we should curb [performance enhancers], but I think we need a better account of what it is athletics is really about and why, rightly understood, it's very much like all kinds of other human activities in which to flourish really means deeds that somehow flow in an uninterrupted way from our souls and bodies." Or take the use of behavior-modifying psychotropic drugs: To what extent should they be prescribed to children not just to correct for abnormal behavior (as Ritalin corrects for attention deficit disorder or Prozac does for depression) but also to improve their performance? Parents generally want to give their kids an edge. But how would the widespread use of, say, concentration-enhancing stimulants by children affect their characters and the character of their childhood, even assuming those stimulants were safe and consistently effective? "Artificial enhancement can certainly improve a child's abilities and performance," Dr. Kass wrote in "Beyond Therapy: Biotechnology and the Pursuit of Happiness," one of the council's six major reports. (Read them at www.bioethics.gov.) "But it does so in a way that separates at least some element of that achievement from the effort of achieving. It may both rob the child of the edifying features of that effort and teach the child, by parental example, that high performance is to be achieved by artificial, even medical, means." And then there is the matter of dramatically prolonging the average human lifespan. Already, mice have been genetically engineered to overproduce certain proteins, thereby extending their average lifespan by about a third; sooner or later, similar genetic manipulations will be safely and usefully available for larger mammals, including humans. The question that will confront us then, says Dr. Kass, "is what the hell is wrong with that?" Dr. Kass is certainly aware that human longevity increased dramatically in the past century, mainly to good effect (although mostly as a result of declining infant and child mortality rates). He is also cognizant of the powerful case, intellectual as well as emotional and intuitive, in favor of prolonging lifespans even further: "If we lived healthily and our friends lived healthily indefinitely, we could earn more, learn more, see more and do more." He is also willing to acknowledge that potential socioeconomic consequences of much longer living--e.g., when does your fit-as-a-fiddle 130-year-old boss retire so you can take his place?--could be resolved in some satisfactory, sustainable way. . . . Dr. Kass rejects this. "Life, liberty and the pursuit of happiness," he says, "are fundamental rights which the regime exists to safeguard. But they do not exhaust the things that Americans believe in. . . . People aspire to lead serious lives, they want to be taken seriously, they want to make something of their lives. They respond when there is illness. It's astonishing what the outpouring of human sympathy can do. On the basis of the calculation of utiles a lot of this stuff doesn't make any sense. . . . The very people who you want to say are content with contentment are the very ones who say 'My God, we don't want to go there!'" It would be a comfort to know that the tide is not, in fact, sweeping us all "there." And, who knows: There may be no there there. But in refusing to discount the possibility that it is, or avert his eyes from what may yet await us, Dr. Kass has performed a national service. Somebody ought to thank him. Continued in article

Jensen Comment
The problem with biotechnology and for that matter advancement in most any discipline is that what is good/bad for an individual may be bad/good for the whole (e.g., society in general).  Take, for example, advancements that allow parents to dictate the gender of each child born.  This may be good for the eventual wealth or happiness of an individual or family, but portends disaster for society as a whole as gender becomes terribly out of balance. 

Another problem is that advancement creates a more fragile society.  Nuclear fission seems like a good idea, but a side effect is that it threatens the life of every organism on the planet.  Electricity makes our lives more comfortable and efficient.  But when the power goes out life becomes suspended where cooled food cannot be preserved, airports are closed, traffic is uncontrolled, businesses must shut down, schools are closed, home temperatures cannot be controlled, water may be shut off, electronic transactions come to a halt, hospitals cannot run without electricity, etc.  Before we had electricity life carried on, but billions of lives would probably be lost today if electricity ended worldwide.  Our ways of coping without power have been destroyed by more than a century of growing dependency on it.  This applies in so many ways to other advancements such as antibiotics, farming with petrochemicals, motor vehicles, sewage systems, etc.

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Why little girls like to torture Barbie Dolls
If you've caught your daughter mutilating her Barbie doll, microwaving her, or decapitating her, don't be disturbed - your girl is perfectly normal. Research published yesterday reveals that as girls grow up, they come to hate Barbie so much that many admit torturing and maiming the doll. The toy has become a "hate figure" among seven to 11-year-old girls, who regard Barbie as a "babyish" symbol of their earlier childhood. Researchers from the University of Bath questioned 100 youngsters about their attitudes to a range of branded products and found the iconic doll provoked the strongest reaction.
"Why little girls like to torture Barbie," Sydney Morning Herald, December 20, 2005 --- http://www.smh.com.au/text/articles/2005/12/19/1134840796230.html

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"Deloitte, Junior Achievement A Launch Ethics Essay Contest," SmartPros, January 6, 2006 --- http://accounting.smartpros.com/x51217.xml

Jan. 6, 2006 — JA Worldwide (Junior Achievement) and Deloitte & Touche USA LLP announced the launch of their second annual ethics essay contest, which awards one high school senior with a $5,000 college scholarship.

To enter, high school seniors must compose an original essay of 500 words or less, in response to an ethical dilemma posted on JA Worldwide’s Web site, located at www.ja.org . Entries must be submitted online and will be accepted until February 3.

The "ethical dilemma" for the essay contest involves a 17-year-old who finds she has been paid $100 more than the agreed-upon amount for her summer lawn-care services.

The winning essay will be selected by the JA Worldwide Blue Ribbon Panel on Ethics, which is comprised of corporate ethics officers and noted academicians. The essays will be judged on how well the student uses an ethical decision-making process in developing a response to the dilemma.

Continued in article.

Once again, the JA link is at http://www.ja.org/

Cynical Comment
It would be most interesting if somebody did an investigative study looking for plagiarism in the submissions.

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The only methamphetamine "epidemic" appears to be on television crime shows
Today the National Institute on Drug Abuse released the latest results from its Monitoring the Future survey of students, and there is still hardly any evidence of the methamphetamine "epidemic" about which we've been hearing so much. In fact, there were statistically significant drops in lifetime use of meth among 10th- and 12th-graders between 2004 and 2005. Past-year and past-month use also fell in both grades. The only increase in meth use was among eighth-graders, with lifetime use rising from 2.5 percent to 3.1 percent, past-year use rising from 1.5 percent to 1.8 percent, and past-month use rising from 0.6 percent to 0.7 percent. None of these increases was statistically significant. As I've mentioned before, the picture is similar in surveys of adults: flat or falling use during the last several years. After seeing the latest numbers, I'm sure Congress will relent and let us have easy access to cold medicine.
"Still No Meth Epidemic," Reason Magazine, December 19, 2005 --- http://www.reason.com/hitandrun/

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Size Matters Brainwise
Brain size matters for intellectual ability and bigger is better, McMaster University researchers have found. It found bigger is better, but there are differences between women and men. In women, verbal intelligence was clearly correlated with brain size, accounting for 36 percent of the verbal IQ score. In men, this was true for right-handers only, indicating that brain asymmetry is a factor in men. Spatial intelligence was also correlated with brain size in women, but less strongly. In men, spatial ability was not related to overall brain size. These results suggest that women may use verbal strategies in spatial thinking, but that in men, verbal and spatial thinking are more distinct. It may be that the size or structure of the localized brain regions which underlie spatial skills in men is related to spatial intelligence, as was shown in previous research in Witelson's lab on the brain of Albert Einstein.
"Bigger brain size matters for intellectual ability," PhysOrg, December 22, 2005 --- http://physorg.com/news9307.html

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From NPR
In a new installment of "Making a List," novelist and commentator Susan Straight talks about the books she likes to give to her students, her friends and acquaintances ---
http://www.npr.org/templates/story/story.php?storyId=5023447

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Why CREF has done well with the Dow now hovering around $11,000

Flashback from The Wall Street Journal, January 12, 1987 Wall Street professionals were unexcited about the Dow Jones Industrial Average exceeding 2000 for the first time last week, but many have been surprised by the momentum and breadth of the New Year's rally. The average finished at a record every day last week.

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Former Wal-Mart Top Executive Confesses to Fraud and Tax Evasion
Former Wal-Mart Stores Inc. Vice Chairman Thomas Coughlin has agreed to plead guilty later this month to federal wire-fraud and tax-evasion charges, according to people familiar with the proposed plea agreement he has struck with prosecutors. The deal, if it holds, will bring down the curtain on a bizarre chapter in Wal-Mart's history. Mr. Coughlin, a Wal-Mart legend who was a protégé and former hunting buddy of founder Sam Walton, left the company early last year amid accusations that he misappropriated as much as $500,000 from Wal-Mart through fraudulent reimbursements and improper use of gift cards.
James Bandler, "Former No. 2 At Wal-Mart Set To Plead Guilty:  Thomas Coughlin to Admit To Fraud and Tax Evasion; Protégé of Sam Walton, The Wall Street Journal, January 7, 2006; Page A1 --- http://online.wsj.com/article/SB113658501190440131.html?mod=todays_us_page_one

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Sarbanes-Oxley:  What is too much of a seemingly good thing?

"Class-Action Sarbox," The Wall Street Journal,  January 7, 2006; Page A6 --- http://online.wsj.com/article/SB113659722018040446.html?mod=opinion&ojcontent=otep 

At first glance, the study from Stanford University and Cornerstone Research seems to be good news, noting that the number of class-action suits filed in 2005 dropped to 176 from 213 in 2004 -- a 17% decrease. Good-governance types are claiming this decline is a direct result of the 2002 Sarbanes-Oxley legislation working as intended, keeping companies on the straight and narrow.

Yet as any first-year Wall Street analyst knows, this minor legal reprieve is better attributed to last year's relatively stable stock market. Class-action suits arise out of booms and busts in equity markets: As share prices dive, plaintiffs' lawyers swarm. Yet with last year's stock market less volatile than at any point since 1996, the "strike suit" pickings were lean.

So what then accounts for those 176 suits? Try . . . Sarbanes-Oxley. It appears the tort bar is now using the law's strict financial-reporting requirements as its latest excuse to sue. A whopping 89% of the suits alleged misrepresentations in financial documents, while 82% claimed false forward-looking statements. Lawyers have certainly used financial documents as a reason to sue in the past, but this year's notable uptick in the number of suits filed that cite this cause of action suggests that the tort bar has found a whole new line of business.

The real news here is that lawyers managed to drum up so many results-related suits in a year when the stock market was stable and corporate earnings were strong. Just wait for the next economic downturn, when class-action lawyers will be able to exploit Sarbox's new "internal controls" documentation as a roadmap. Our guess is that we have only begun to discover the ways in which Sarbox will be a trial-bar bonanza.

Continued in article

Jensen Comments
A useful reference site from Cornerstone is at http://www.cornerstone.com/fram_res.html
A Stanford University Press Release is at http://securities.stanford.edu/scac_press/20060103_CR_SCAC.pdf
The Stanford University Law School Class Action Clearinghouse is at http://securities.stanford.edu/

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Payback Time:  Now This Twit's in the Front of the Classroom
I think what has taken me back are the blank stares, heads on desks, and absentees in my classroom. As I struggle with teaching in ways I wasn’t expecting, I guess I’m a bit defensive and feeling sorry for myself. I sometimes think I don’t deserve what I’m getting, just as my undergraduate professors didn’t deserve what I gave. But it’s probably a good thing I’m thinking about my own bad behavior as an 18-to-20-year-old. The optimist battling these pessimistic feelings believes such memories might be a first step toward focusing on the students in this process, instead of myself. Like a transgressor at an AA meeting, I want to stand up and cleanse my soul, hopefully to get rid of the guilt I feel when I think of what I did to others, because now it’s happening to me. “Okay, okay, I get it,” I want to say to my professors of old. “I was a twit.”
Danna L. Walker, "Open Letter to My College Professors," Inside Higher Ed, January 6, 2006 --- http://www.insidehighered.com/views/2006/01/06/walker 

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"GASB Publishes Guide to Statement 44 on the Statistical Section," SmartPros, January 5, 2006 --- http://accounting.smartpros.com/x51205.xml

Jan. 5, 2006 — The Governmental Accounting Standard Board has published a guide to implementation of GASB Statement 44 on the Statistical Section.

The guide was prepared by GASB staff primarily to assist preparers and auditors of governmental financial statements and those that advise them as they implement the updated and expanded statistical section. The statistical section is the part of a state or local government's comprehensive annual financial report (CAFR) that presents trend information for the last ten years about a government’s financial results, major revenue sources, outstanding debt, economic and demographic indicators, and operating activities.

The guide contains over 120 questions and answers on important aspects of Statement 44, including:

Presenting newly required information, such as net assets, changes in net assets, fund balance, and total outstanding debt. Identifying a government’s most significant own-source revenue and its overlapping governments. Calculating total direct rates, debt ratios, overlapping debt, and debt limit information. Obtaining and reporting demographic and economic information. Selecting appropriate trend information about government employees, operating indicators, and capital assets. The questions and answers are accompanied by more than 160 illustrations, including complete sample statistical sections, alternative formats, and optional schedules for nine types of governments -- local, county, and state general purpose governments, a school district, a library district, a public university, a water and sewer authority, an airport, and a retirement system. The Guide also includes a glossary, topical index, and the Standards section of Statement 44.

The guide can be ordered through www.gasb.org 

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Question
What states are soft on sex offenders?

Answer
'Factor' Investigation: Which States Are Soft on Sex Offenders? --- http://www.foxnews.com/story/0,2933,162254,00.html

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Question
Where do American and Canadian tourists frequent for sex with children?

Answer
Enslaving kids --- http://www.jewishworldreview.com/cols/oreilly020204.asp

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Ovarian Cancer Study Is Hailed
Pumping heavy doses of chemotherapy drugs right into the abdomen boosted survival of women with advanced ovarian cancer by 16 months in what experts call the first big advance in more than a decade against one of the most lethal cancers in women.
"Ovarian Cancer Study Is Hailed," The Wall Street Journal, January 5, 2006; Page D6 --- http://online.wsj.com/article/SB113639854954237690.html?mod=todays_us_personal_journal 

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"Hedge Funds With Losing Records to Liquidate," Bloomberg News by way of the New York Times, January 7, 2006 --- http://www.nytimes.com/2006/01/07/business/07hedge.html?oref=login 

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Community-based Networks and Innovative Technologies --- http://propoor-ict.comunica.org/

In many instances, at least in urban areas, the communication needs of the poor are acknowledged and telephony markets – formal and informal – are emerging to serve them. However, rural areas and sparsely populated communities still tend to be underserved. The main obstacle is simple. Installation costs are often higher because of lack of developed infrastructure such as roads and electricity. Sparser populations and low levels of income mean that conventional approaches appear to be economically unattractive, whether for market-driven or more traditional public sector providers who are now unable to benefit from cross-subsidies to roll-out services.

The technology-development landscape is continuously evolving not only in terms of market dynamics and technology opportunities but also in terms of permitting new approaches to meeting the development and communication needs of the poor and under-served communities.

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Did Enron change executive looting tendencies?
Despite an array of new and expensive laws and regulations that were adopted to tighten corporate oversight after the wave of scandals earlier in the decade, serious accounting problems continue to trouble publicly owned companies. In the last year, a record number have been forced to correct erroneous earnings statements, which often led to sharp stock declines. Moreover, for all the widespread criticism of high pay of executives at Enron and other companies that later proved derelict, studies show that there is still little overall correlation between the performance of many companies and the executive compensation set by their directors.
Stepen Labaton, "Four Years Later, Enron's Shadow Lingers as Change Comes Slowly," The New York Times, January 5, 2006 --- http://snipurl.com/NYT0105

Bob Jensen's threads on executive compensation scandals are at http://www.trinity.edu/rjensen/FraudConclusion.htm#OutrageousCompensation

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The National Research Council’s ratings claim to measure research quality, but they ignore some of the most important and cutting-edge fields

"The Great Mismatch," by Kermit L. Hall and Susan Herbst, Inside Higher Ed, January 5, 2006 --- http://www.insidehighered.com/views/2006/01/05/hall

This fall the NRC released its new taxonomy, listing the fields that would be assessed and those that would not be studied. The new taxonomy reflects our worst fears for the assessment of Ph.D. programs: It fails to recognize a large number of thriving and vitally important fields where some of the most talented researchers in the world can be found. Among these fields are criminal justice, public administration and policy, social work, information science, gender studies, education, and public health. We have expressed our strong objections about these exclusions to Ralph J. Cicerone, president of the National Academy of Sciences, and to Charlotte Kuh, study director for the NRC Assessment. We have received no response, and other academic leaders have been treated with the same disregard when they have challenged plans for the new assessment. Such behavior seems especially problematic given the importance of the NRC study for institutions and researchers.

Placing fields like gender studies and information studies in the new, nebulous “emerging fields” category — fields that will not be rated — does not solve the problem in the least, but simply steers important scholarly endeavors in a giant black box. The justification of the taxonomy boldly notes that “emerging areas of study may be transitory,” hence it is risky to evaluate them with the same rigor used for other fields. From what we can discern at least, information science, the study of race, of ethnicity, of sexuality, and gender have already emerged, and have profoundly changed the academy for the better. We imagine that scholars in these fields are not transitory in the least: A large number of them hold endowed chairs, run centers, manage departments, edit journals, lead foundations and run major institutions.

Continued in article

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Counting rather than reading documents:  Don't we do this when granting tenure?

"Literature to Infinity," by Scott McLemee, Inside Higher Ed, January 4, 2006 --- http://www.insidehighered.com/views/2006/01/04/mclemee 

Graphs, Maps, Trees: Abstract Models for a Literary History is a weird and stimulating little book by Franco Moretti, a professor of English and comparative literature at Stanford University. It was published a few months ago by Verso. But observation suggests that its argument, or rather its notoriety, now has much wider circulation than the book itself. That isn’t, I think, a good thing, though it is certainly the way of the world.

In a few months, Princeton University Press will bring out the first volume of The Novel: History, Geography, and Culture — a set of papers edited by Moretti, based on the research program that he sketches in Graphs, Maps, Trees. (The Princeton edition of The Novel is a much-abridged translation of a work running to five volumes in Italian.) Perhaps that will redefine how Moretti’s work is understood. But for now, its reputation is a hostage to somewhat lazy journalistic caricature — one mouthed, sometimes, even by people in literature departments.

What happened, it seems, is this: About two years ago, a prominent American newspaper devoted an article to Moretti’s work, announcing that he had launched a new wave of academic fashion by ignoring the content of novels and, instead, just counting them. Once, critics had practiced “close reading.” Moretti proposed what he called “distant reading.” Instead of looking at masterpieces, he and his students were preparing gigantic tables of data about how many books were published in the 19th century.

Continued in article

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From Topless to Jobless
Morgan Stanley has fired a stock-research analyst and three sales staffers in the Wall Street firm's institutional-stock division after they accompanied one or more clients on a visit to an adult-entertainment club, according to people familiar with the matter. The firing of the staffers, all men, sent a message that exclusionary, male-only activities won't be tolerated at the firm, according to people familiar with the matter. In mid-2004, Morgan Stanley agreed to pay $54 million to settle a gender-discrimination case. As part of the settlement, Morgan Stanley denied wrongdoing but agreed to take additional steps to promote diversity and conduct antidiscrimination training.
"Morgan Stanley Fires Male Staffers For Strip-Club Trip," by Randall Smith, The Wall Street Journal, January 5, 2006; Page C3 --- http://online.wsj.com/article/SB113642955212838313.html?mod=todays_us_money_and_investing

Jensen Comment
My favorite source for investment banking scandals is Frank Partnoy.  His early books reveal how back in the 1990s Morgan Stanley and some other investment banks had some bizarre sexcapades, including bikini-clad women in their trading rooms --- http://www.trinity.edu/rjensen/FraudRotten.htm#DerivativesFrauds

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Who are the big criminals in Washington DC?  Gingrich ought to know!
"You can't have a corrupt lobbyist unless you have a corrupt member (of Congress) or a corrupt staff. This was a team effort," Gingrich told a Rotary Club lunch in Washington on Wednesday. He called for systematic changes to reduce the enormous financial advantages that incumbents have in congressional elections. As head of a conservative movement based on ethics concerns and promises to curb federal growth, Gingrich led the GOP in 1994 to its first House majority in 42 years. But he decided to resign in 1998 when Republicans lost seats a year after Gingrich himself was fined $300,000 for violating House rules barring the use of tax-exempt foundations for political purposes.
Michael J. Sniffen, "GOP Politicians Dump Abramoff Donations," Yahoo News, January 5, 2006 --- http://news.yahoo.com/s/ap/20060105/ap_on_go_pr_wh/abramoff_fallout

Also see http://www.nationalreview.com/york/york200601040926.asp

Meanwhile in California
"Abramoff, clients gave thousands to California officials," Michael R. Blood, ModBee, January 5, 2006 --- http://www.modbee.com/state_wire/story/11655000p-12384299c.html

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It's beginning to look like fraud and creative accounting at Delta Airlines
Creditors often have a hard time collecting from companies in bankruptcy, but a group of plane owners trying to retrieve three leased Boeing 767s claims Delta Air Lines is going too far. The aircraft owners, mostly investment banks such as Morgan Stanley and Natexis Banques Populaires SA of France, claimed in a court filing last week that Delta violated bankruptcy rules by disassembling the aircraft and storing the frames and engines in separate locations.
"Delta Air's Fight With Creditors Over Leased Jets Heads to Court," by Evan Perez, The Wall Street Journal, January 5, 2006; Page A2 --- http://online.wsj.com/article/SB113642163895438078.html?mod=todays_us_page_one

Jensen Comments
This reminds me of a clever ploy used by car thieves in San Antonio.  One of the problems in stealing a car and then selling it in the U.S. in the vehicle's VIN number.  What some thieves purportedly do is steal a luxury car and separate the body from the drive train.  Then the body is abandoned where the police will find it.  The police (possibly in cahoots with the thieves) then sell the body at a public auction.  Keep in mind that the body has no engine or transmission.  The thieves then buy the body and thereby acquire a legitimate ownership of the VIN number.  Then they install the original drive train and sell the entire care for a handsome profit.

Accounting Issue:  The Bright Line Problem
I'll just bet these aircraft were carried as operating leases rather than capital leases since airlines tend to push to the edge of bright line rules of FAS 13.  How do you account for operating leases of assets that are disassembled for parts?

Bob Jensen's threads on how bright lines are used to hide debt with operating leases are at http://www.trinity.edu/rjensen//theory/00overview/theory01.htm#Leases