The Deipnosophist

Where the science of investing becomes an art of living

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Location: Summerlin, Nevada, United States

A private investor for 20+ years, I manage private portfolios and write about investing. You can read my market musings on three different sites: 1) The Deipnosophist, dedicated to teaching the market's processes and mechanics; 2) Investment Poetry, a subscription site dedicated to real time investment recommendations; and 3) Seeking Alpha, a combination of the other two sites with a mix of reprints from this site and all-original content. See you here, there, or the other site!

29 February 2008

"What if you have to go to the bathroom?"

S writes to say, "Look at this site! And when you want to really laugh, look at the price."

S's sister, Cheryl, who shared originally the site, adds, "What if you have to go to the bathroom...?"

Yep. Anecdotal evidence, perhaps, of an absolute high in prices? Certainly worth the yucks S promises!
-- David M Gordon / The Deipnosophist

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23 February 2008

It’s all downhill from here

The endlessly fascinating article below is, in fact, an excerpt from a forthcoming book. And if the book is as interesting as this selection, I look forward to enjoying it as well.

'Tis a good thing, indeed, that all these interesting articles arrive on the weekends, when we having nothing but a plethora of available time...

Say what, David...!!??
-- David M Gordon / The Deipnosophist

It's all downhill from here

From The Thing About Life Is That One Day You'll Be Dead by David Shields. © 2008 by David Shields.
Excerpted by permission of Knopf, a division of Random House, Inc.

Your brain starts shrinking at 25. Your handshake starts going soft at 30. At 40, your memory starts to slip. In a new book, author David Shields catalogues the myriad ways that our bodies gradually betray us.

If you could live forever in good health at a particular age, what age would you be? As people get older, their ideal age gets higher. For 18- to 24-year-olds, it's age 27; for 25- to 29-year-olds, it's 31; for 40- to 49-year-olds, it's 40; and for people over 64, it's 59.

Your strength and coordination peak at 19. Your body is the most flexible until age 20; after that, joint function steadily declines. World-class sprinters are almost always in their late teens or early 20s. Your stamina peaks in your late 20s or early 30s; marathon records are invariably held by 25- to 35-year-olds.

Sir William Osler, the father of modern medicine, said, "The effective, moving, vitalizing work of the world is done between the ages of 25 and 40." Which is in fact true: Creativity peaks in the 30s, then declines rapidly; most creative achievements occur when people are in their 30s. Degas said, "Everyone has talent at 25; the difficulty is to have it at 50." The consolation of the library: When you're 45, your vocabulary is three times as large as it is at 20. When you're 60, your brain possesses four times the information than it does at 20.

Your IQ is highest between ages 18 and 25. Once your brain peaks in size—at age 25—it starts shrinking, losing weight, and filling with fluid. As you age, your responses to stimuli of all kinds become slower and more inaccurate, especially in more complex tasks. From ages 20 to 60, your reaction time to noise slows 20 percent. At 60, you make more errors in verbal learning tasks. Given a list of 24 words, an average 20-year-old remembers 14 of the words, a 40-year-old remembers 11, a 60-year-old remembers nine, and a 70-year-old remembers seven.

Most people reach skeletal maturity by their early 20s. At 30, you reach peak bone mass. Your bones are as dense and strong as they'll ever be. In your late 30s, you start losing more bone than you make. At first you lose bone slowly, 1 percent a year. The older you get, the more you lose.

Beginning in your early 20s, your ability to detect salty or bitter things decreases, as does your ability to identify odors. The amount of ptyalin, an enzyme used to digest starches, in your saliva decreases after age 20. After age 30, your digestive tract displays a decrease in the amount of digestive juices. At 20, in other words, your fluids are fleeing, and by 30, you're drying up.

Lauren Bacall said, "When a woman reaches 26 in America, she's on the slide. It's downhill all the way from then on. It doesn't give you a tremendous feeling of confidence and well-being."

Until you're 30, your grip strength increases; after 40, it declines precipitously. After age 65, your lower arm and back muscle strength declines. Owing to reduced coordination rather than loss of strength, your power output—e.g., your ability to turn a crank over a period of time—falls after age 50.

By age 35, nearly everyone shows some of the signs of aging, such as graying hair, wrinkles, less strength, less speed, stiffening in the walls of the central arteries, degeneration of the heart's blood vessels, diminished blood supply to the brain, elevated blood pressure. The maximum rate your heart can attain is your age subtracted from 220; therefore it falls by one beat every year. Your heart is continually becoming a less-efficient pumping machine.

Emerson said, "After 30, a man wakes up sad every morning, excepting perhaps five or six, until the day of his death."

In My Dinner With André, Wallace Shawn says, "I grew up on the Upper East Side, and when I was 10 years old I was rich, an aristocrat, riding around in taxis, surrounded by comfort, and all I thought about was art and music. Now I'm 36, and all I think about is money."

Mozart died at 35; Byron, at 36; Raphael and van Gogh, at 37. The oldest age at which anyone broke a track-and-field record was 41, in 1909.

Beginning at 40, your white blood cells, which fight cancer and infectious diseases, have a lowered capacity. Each year, more fat gets deposited in the walls of medium and larger arteries, causing the arterial walls to narrow. The weight of your small intestine decreases; the volume and weight of your kidneys shrink. Total blood flow to the kidneys decreases by 10 percent for every decade after the age of 40. Every organ will eventually get less nourishment than it needs to do its job.

Cicero said, "Old age begins at 46." He died at 53.

Victor Hugo said, "Forty is the old age of youth. Fifty is the youth of old age."

Every decade after age 50, your brain loses 2 percent of its weight. You have difficulty learning things and you remember less and less. Memory per se—the actual encoding of information—isn't diminished in a healthy, older person, but retrieval can be an excruciatingly slow process and take many more attempts. Older people are more susceptible to distraction, have trouble coordinating multiple tasks, and have decreased attention spans. In simple tasks and common situations, the old do fine, but when exercise or other stress is added, they often struggle. Perhaps this is why some older people, finding it harder to cope, tend to start searching for comfort rather than excitement.

Evelyn Waugh said, "Old people are more interesting than young. One of the particular points of interest is to observe how after 50 they revert to the habits, mannerisms, and opinions of their parents, however wild they were in youth."

"At 50, everyone has the face he deserves," said George Orwell.

Virgil, author of The Aeneid, died at 50. Shakespeare died at 52.

You gain weight until age 55, at which point you begin to shed weight (specifically, lean tissue, muscle mass, water, and bone). More fat now accumulates in your thighs and less in your abdomen. Your extremities become thinner and your trunk thicker. Middle-aged spread isn't only the result of increased fatty tissue; it's also caused by losing muscle tone and your skin literally thinning out as each skin cell loses its robustness.

n late middle age, the skin in your hands becomes less sensitive to touch. Your skin cells regenerate less often. The skin weakens and dries, the number of sebaceous glands declines dramatically, and all of the tissues of the skin undergo some change: You get wrinkles and gray hair. Wrinkles don't come from age, though. They come from sunlight, which slowly maims the face, causing wrinkles, mottling, and loose skin. "The years between 50 and 57 are the hardest," said T.S. Eliot. "You are being asked to do things, and yet you are not decrepit enough to turn them down."

Your blood cholesterol increases. At 60, you've lost 25 percent of the volume of saliva you normally secrete for food; it becomes more difficult to digest heavy meats.

Emerson said, "'Tis strange that it is not in vogue to commit hara-kiri, as the Japanese do, at 60. Nature is so insulting in her hints and notices, does not pull you by the sleeve, but pulls out your teeth, tears off your hair in patches, steals your eyesight, twists your face into an ugly mask, in short, puts all contumelies upon you, without in the least abating your zeal to make a good appearance, and all this at the same time that she is moulding the new figures around you into wonderful beauty, which of course is only making your plight worse."

he PR flak Harlan Boll defends his lying about his celebrity clients' ages by saying, "The American public doesn't really forgive people for getting older." Which is of course true. Jackie Kennedy said if she knew she was going to get cancer at 65, she wouldn't have done all those sit-ups. In jail, O.J. Simpson bemoaned to his girlfriend that the once admirable, apple-like shape of his posterior had collapsed into middle-aged decrepitude. Gravity sucks.

By the time you reach 65, you've lost 30 percent to 40 percent of your aerobic power. The walls of your heart thicken, and you're more likely to develop coronary disease. Sixty percent of 60-year-old men, and the same percentage of 80-year-old women, have a major narrowing in at least one coronary artery. A stiffening in the walls of the major arteries results in a progressive increase in blood pressure, which imposes an increasing load on the heart. Since the heart has to work harder for each heartbeat and use more energy, the overall efficiency of the cardiovascular system drops significantly.

When you're a young adult, the reflex that tells you it's time to urinate occurs when your bladder is half-full. For people over age 65, the message isn't received until your bladder is nearly full.

At 68, Edmund Wilson said, "The know­ledge that death is not so far away, that my mind and emotions and vitality will soon disappear like a puff of smoke, has the effect of making earthly affairs seem unimportant and human beings more and more ignoble. It is harder to take human life seriously, including one's own efforts and achievements and passions."

In your late 60s, you eat less. Your metabolic rate decreases slightly. The density of your skin's circulatory systems—veins, capillaries, arterioles—is reduced, which is why old people feel cold sooner. Also, your skin functions less well as a barrier because the skin is thinner—like wearing too light a coat. As you age, your facial skin temperature falls. For older people, a comfortable temperature is 10 to 15 degrees higher than it is for a younger person.

There are now more people in the United States over 65 than ever before. Only 30 percent of people ages 75 to 84 report disabilities—the lowest percentage ever reported.

Five percent to 8 percent of people over 65 have dementia; half of those in their 80s have it.

Aristotle described childhood as hot and moist, youth as hot and dry, and adulthood as cold and dry. He believed aging and death were caused by the body being transformed from one that was hot and moist to one that was cold and dry—a change that he viewed as not only inevitable but desirable.

At age 90, you grow increasingly less likely to develop cancer; the tissues of an old person don't serve the needs of aggressive, energy-hungry tumors.

When you're very young, your ability to smell is so intense as to be nearly overwhelming, but by the time you're in your 80s, not only has your ability to smell declined significantly but you yourself no longer even have a distinctive odor. You can stop using deodorants. You're vanishing.

"As we get older," the British poet Henry Reed helpfully observed, "we do not get any younger."

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22 February 2008

"I am confused"

A reader writes...
"Of course I do want to make "big" money. However, I am concerned as to the current market environment; slowing economy, excessive consumer and government debt, high commodity prices (sorry, I can't complain about oil), current disarray in financial, residential and commercial markets (soon), Federal Reserve with questionable priorities, government policies which make no sense, on and on. Do you still subscribe to Fred Hickey's newsletter? He certainly paints a negative scenario and has for several years. I am confused. Help me out."
The items you mention are each a major concern; they worry investors and consumers alike. And bankers, especially the Federal Reserve Bank (FRB). In effect, does the economy teeter on the cusp of a tailspin of generational proportions? Perhaps, but no one truly knows, and least of all me.

Problems, issues, and fundamental concerns always lurk in the news backdrop. Again, the items you note are a major concern, but I view them, by their obviousness, as today's problems, and thus not necessarily tomorrow's problems; i.e., their severity lessens by their popularity. (The media, business leaders, and consumers each discuss the effects of the current litany of woes on their personal life or business.)

Investors naturally share these concerns, but professional investors seek a different input; not the news itself, but the news response syndrome. The distinction is crucial. "How do prices react to news?" So we each, as a professional investor, set up a rules-based methodology. For example:
1) The tendency for markets to open higher but close lower is decidedly bearish;

2) The tendency for markets to open lower but close higher is decidedly bullish.

The difference is the markets' ability to slough off the news of the day - the news response syndrome - and is only one of a set of subtle clues that chart readers and market technicians seek. Crucial turning points occur during the moments I term extreme, obscene weakness (or extreme, obscene strength). As any trend matures (becomes extreme), it also becomes readily discernible to all observers - a sure thing - and many investors invest for that trend.

But all trends die (reverse). Or correct the excesses of the prior move, and then hibernate (base) for an extended period. My term for that singular moment when prices reverse to up from down (or down from up) is obscene weakness (strength), and always comes after a trend of extreme weakness or strength (i.e., an extended trend). This moment typically manifests as a large continuation gap in the existing trend, but proves to be, in fact, an exhaustion gap, as the shares reverse course from the day's opening price gap, and then closes at the opposite end of that day's price bar. Best action is when the reversal occurs at a level of crucial price support.

Alas, the notion of support and resistance is horribly misunderstood. Most investors seek only a prior low that reversed and proved prefatory to higher prices, or a high that reversed and proved prefatory to lower prices. But no additional measures of validation support their interpretation. Here is one identifier: once resistance, now support. The mere identification of a low in an uptrend (or a high in a downtrend) that was not itself prior resistance is not support; certainly not crucial support.

I do not claim that my every decision is perfect, or that I make no mistakes. Nor will I pretend that my every wrong decision and action were all proved correct with the passage of (sufficient) time. Such actions are folly, and serve only to mislead me more than they do you. In fact, my personal motto is "Always wrong, but never in doubt." I find this sentiment to be incredibly liberating; it allows me the opportunity to make each decision free of of the (emotional) need to be correct. I no longer require the markets to ratify my analysis before I take action; i.e., purchase before the up trend resumes (and vice-versa). Now I make the decisions, and take the actions, and then manage the positions; up, down, or sideways. Whether correct or incorrect. Master the detail; manage the risk.

As an investor - as an adult - I take full responsibility for all my decisions and actions; if in error, I immediately own up to the bad decision, not sweep it under the rug. "Full responsibility" equals making the hard decision: stopping out when wrong, taking profits when correct. After all, I made the decision to enter the position, so I take the responsibility to close the position. The inability to close a position is, to me, purely emotional ("The market will probably scream higher after I sell!"), and has no place in an investor's awareness and apprehension of risk and opportunity.

Of course, I seek guidance to be correct more often than [I am] wrong. In life, I heed the guidance of those smarter and better than me (especially you, S);when investing, I heed the message of the markets. For an investor, for me, the markets tell all... far more than the current crop of news headlines.

Full Disclosure: Always long the market via my favorite investments, but with varying percentages.
-- David M Gordon / The Deipnosophist

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18 February 2008

Weekend Getaway

The holiday weekend afforded S and I the opportunity for a quick getaway to Santa Barbara, CA.

The journey was long, but worth every moment. What awaited our arrival was g
orgeous weather, beautiful scenery, the luminous light, and love everywhere. (Understandably so, as it also was Valentine's Day!)

[To begin slideshow, click two times on the play icon]

btw, a permanent link to a full-screen version of this slideshow is in the photo well (left sidebar).
-- David M Gordon / The Deipnososphist

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14 February 2008


What could be more appropriate on Valentine's Day than to share poetry -- especially an excellent love poem? And poetry does not often get much better than this poem, WINDCHIME, by Tony Hoagland, which speaks of love, yes, but from an unusual perspective.

btw, one tip to employ when reading poetry: read to the punctuation marks, and not to the end of lines. A trick that Hoagland uses especially well, and to excellent effect. Note the words he uses to end several lines (but not sentences!) of stanza #2 (hand, nail, teeth), which he mimics in stanza #4 (chest, forehead, mouth). And the indelible image of the mouth with the nail in it (sticking out of it!) that yet remains (eminently) kissable. All very clever, indeed. Ahh, love.

For you, SA.

Full Disclosure: Long love. And loving every moment of it.
-- David M Gordon / The Deipnosophist


She goes out to hang the windchime
in her nightie and her work boots.
It's six-thirty in the morning
and she's standing on the plastic ice chest
tiptoe to reach the crossbeam of the porch,

windchime in her left hand,
hammer in her right, the nail
gripped tight between her teeth
but nothing happens next because
she's trying to figure out
how to switch #1 with #3.

She must have been standing in the kitchen,
coffee in her hand, asleep,
when she heard it—the wind blowing
through the sound the windchime wasn't making
because it wasn't there.

No one, including me, especially anymore believes
till death do us part,
but I can see what I would miss in leaving
the way her ankles go into the work boots
as she stands on the ice chest;
the problem scrunched into her forehead;
the little kissable mouth
with the nail in it.

-- Tony Hoagland

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11 February 2008

Is it safe?

One reader chides me for purchasing stocks with high PEs, as though successful investing requires nothing more than a snapshot (frozen moments in time) of the opportunity rather than recognize that investing is a process and not an event.

Companies and their products have life cycles; so do stocks. Value stocks are nothing other than growth companies whose (rapid) growth is a thing of the past. Thus, value stocks represent opportunities largely for that class of investor fearful of the markets' continuing processes and trend -- its continuum -- and who prefer to hide under the covers of snapshot measures of a company's value and worth.

But investors never stay still for long; they seek always a company with increasing earnings (Why invest in a company that does not make more money at an increasing pace?) or a rising stock price (Why invest in a stock whose share price is declining? aka, to catch a falling safe.). So, while measures of fundamental valuation such as PEs are worthy, they remain insufficient. Investors express their interest in a company's growing fortunes via purchasing the shares of said company's stock; a rising share price manifests as one valid measure of interest on the part of investors, if other measures ratify that rising share price.

Oddly, there come moments when investors can purchase growth at value prices; these moments typically occur during and after market sell-offs, such as the market decline of the past ~3 months. Apple/AAPL and Google/GOOG represent two opportunities that I have publicly argued in favor of for a long while. Nothing is amiss fundamentally at either company; the market's decline merely served to lower these two companies' share prices and valuations to startlingly fine purchase points. And, yes, while the daily bar chart of each looks scary today, at least at first glance, things change. (Farther down this post I share a third opportunity.)

Another reader, Eric Chan, writes,
"With the market plummeting, are those market internals still showing a likely rebound in the near future? Perhaps that would help VMW on its breakout?"

The markets have since staged a bounce that, at this moment, appears likely to have legs, and which thus appears to be a fine opportunity for investors to buy during secondary tests. However, since Eric asked his question, VMWare/VMW broke down, and calamitously. The incessant fear regards the company's competition, especially from Microsoft/MSFT.

I have no doubt that VMWare's products will best whatever Microsoft offers as its solution to virtualization; Microsoft rarely offers a best of breed solution. But Microsoft is persistent and will invest for years to improve their offering, as virtualization is a key growth segment that is very close to their core markets.

More important, however, is the method by which Microsoft will compete in the near and medium term. Microsoft's strategic objective is...
1) To protect their core operating system and office spaces, and
2) To wound VMWare and impede it's growth, and
3) To make money in a new segment in that order.

Thus, Microsoft likely will deliver a minimalist offering that will appeal to the middle market. Almost no one in the Fortune 1000 will give it serious consideration, but mid-size companies will. Most important, they will sell it at a radically cheaper price. They do this primarily to spoil the market for the high-end, high-quality solution and slowly turn it into price-based market and could force VMWare ever farther up-market.

Simultaneously Microsoft will work to make virtualization more and more of a feature provided by their operating system. The list of stand-alone applications that became integrated into the OS is quite lengthy, and the landscape is littered with the corpses of companies who produced successful niche products that identified a segment for Microsoft and which Microsoft then destroyed by incorporating the feature into its OS.

I don't dispute for a moment the characterization of the situation today. And while I think I have a handle on how this thing eventually plays out, I have little in the way of insight as to how long this process takes. Probably it takes long enough that VMWare will have a good earnings trajectory for many more years. That seems the key question, if one is evaluating investing in VMWare: How quickly will Microsoft spoil their market? The answer: It will take more than a first offering but it will take less than a truly superior product.

Two methods (technology company) investors utilize to manage the risk of increasing competition is to find companies that:
1) Manifest as a first-mover, and thus have an increasingly impenatrable 'lock' on the market, or
2) Its products have patent protection, which places a wide and deep moat and castle walls around its product.

One technology company with
substantial patent protection, and which is familiar to many of this site's readers, is Qualcomm/QCOM. Qualcomm is, quite simply, the owner of CDMA technology; although, in addition, a chip designer that sells proprietary chips incorporating CDMA technology, though it contracts the actual manufacture of those chips. The CDMA technology benefits Qualcomm primarily through the collection of royalties on the use of that technology. The chip business benefits Qualcomm by the selling of the chips and chip designs they create and manufacture.

In a (very small) nutshell that is the whole company but as you might expect there is much more to the story. To evaluate the company one must begin by understanding CDMA and its value. CDMA is one of the two basic technologies that enable the cell phone. The other is various variants of TDMA. CDMA is an acronym for Code Division Multiple Access, TDMA an acronym for Time Division Multiple Access. There are other schemes as well, but they have largely disappeared.

Let's say you and I are both talking on our cell phones, but not to each other. We do happen to be standing very near one another, and therefore controlled by the same cell tower. Since we both share the same spectrum the cell phone must understand which incoming signal is meant for you and which for me. Likewise, should we each speak at the same time, the cell phone head-end equipment (on the tower) must be able to know which signal is coming from me so it can route it to the person to whom I'm talking. Since spectrum is an extremely scarce resource this (multiplied many times over) is the fundamental problem of all cell phone technologies.

TDMA solves the problem simply but inefficiently. Basically it "time slices" the spectrum. For a brief period, my conversation is "on", for the next slice I am "off" and you are "on". Since these time slices are faster than human perception we both see our conversations as happening at the same time. Of course, the more people accessing that tower on that spectrum at the same time, the more time slices are needed. At a certain point, no more conversations can take place off that tower at that time, and others trying to make or receive calls will be unable to do so until someone ends their conversation.

CDMA solves the problem in a fundamentally different way, one that, with the exception of a few diehards, is recognized universally as better and more efficient. CDMA is a variant of "spread spectrum" technology. Rather than time slice the two conversations CDMA transmits both conversations simultaneously but relies on decoder chips inside each cell phone to figure out which part of that signal is meant for you and which is meant for me. Though it requires more programming complexity it turns out that this is a huge advantage over TDMA.

Being totally digital and not having to devote complicated circuitry to handle the time slice algorithms, CDMA cell phones typically draw less power resulting in longer time between charging and/or smaller phone batteries.

There are limits to how refined TDMA time slicing can be. If sufficient time is not given to each active conversation - whether or not any actual talking is taking place at that instant or not - users will sense the delays. We are extremely sensitive to such issues once they reach the threshold of perceptibility. CDMA deals with crowding by "degrading gracefully" a technical term which basically means that every conversation may suffer slightly in terms of audio quality but no time delays will be noted. At a certain point of course, no more degradation can be tolerated and CDMA too will max out until someone hangs up.

There are few limits to how sophisticated the decoding programming can get in CDMA, resulting in innovation cycles that can pack more bits into any unit of cell phone bandwidth. New algorithms can increase the use of silence to improve carrying capacity, as can their ability to work with lower and lower signal strengths.

Similarly, these factors can drive CDMA to require fewer towers and/or more conversations off a single tower, and can do so with simpler, lower power head-end equipment.

Last, and crucially, spread spectrum provides sufficient bandwidth to support reasonable data rates for the transmission of digital data which, of course, is the driving edge of what's happening in the cellular arena.

CDMA is a primary technology in the USA (being used primarily by Sprint and Verizon), parts of Asia, and parts of Latin America. Until recently, TDMA was used primarily in Europe under the GSM system, also by parts of Asia and Latin America. But with the adoption of 3G and the need carry increasing amounts of data, Europe and other GSM areas are increasingly moving to what's known as WCDMA. WCMDA is bascially an amalgam of both technologies but the incorporation of CDMA algorithms has led most European courts to rule in Qualcomm's favor regarding patent royalties on WCMDA.

On a technical level CDMA is one thing, but on a business level quite another. Qualcomm is an extremely controversial company, perceived as a newcomer and interloper by older, more established, and primarily European, companies. For years, they stubbornly refused to adopt CDMA while spending hundreds of millions trying to find ways to engineer around Qualcomm's patents. Whether WCDMA actually is a necessary technology or just a blatant attempt to engineer around Qualcomm's patents is a matter of much dispute. What is beyond dispute is that CDMA would have worked for 3G European networks and that - in the end - they have accomplished little in trying to engineer around paying royalties to Qualcomm. Another key market that has resisted Qualcomm is China, which - having a closed market - has both only allowed CDMA to be deployed by a relatively small provider and heavily invested in likewise circumventing Qualcomm's patents.

These are business issues for Qualcomm that have repeatedly affected the company. There has been extreme hostility to the very thought of cooperating with Qualcomm, with established companies feeling that their technology ought to be freely available. (The courts seemingly do not agree.) But Qualcomm is also often seen as overly "aggressive” having pushed for high royalties and refusing to allow potential partners some slack given their strong position, thus guaranteeing that potential partners would resent them and seek ways to circumvent them. The blame is difficult to establish, but there is no question that the extreme ill-will that dominates this area has and continues to have a negative impact on the company.

Nevertheless, CDMA royalties remain the crown jewels of Qualcomm's business and a major source, of very high margin revenue.

Qualcomm however also has a second business. They manufacture various chips that incorporate CDMA capabilities and often combine them with other features. It is important at the outset to understand that they do not actually manufacture the chips. They design them and contract with fabs such as Taiwan Semiconductor/TSM to manufacture the chips. This is a quite common manufacturing technique for chip companies and leads to higher margins, lower invested capital, but also somewhat less control of the manufacturing process. It is also important to understand that Qualcomm - in its chip business - operates like any number of other companies that manufacture chips containing CDMA technologies. Companies such as Texas Instruments/TXN and dozens of others can and do produce chips containing CDMA technologies under royalty bearing agreements with Qualcomm. Wisely, Qualcomm has chosen not to be a sole provider of such chips as that would have only exacerbated their perceived problems with handset and network providers.

Therefore, in this business, they are one company among many, albeit one that has several advantages in that they do not have to pay royalties and have a more intimate knowledge of CDMA and where it might be heading.

This leads to what is probably the most important growth related issue for Qualcomm. It is a battle for the guts of the cell phone. Just as Intel/INTC - which dominates the X86 industry - has expanded for years by adding more and more to their processor chip, chip sets and eventually mother boards, in an effort to lever their control of the processor into more revenue per PC, Qualcomm whose CMDA chips are the "processors" of the cell phone has sought to garner increased revenue per handset by incorporating other technologies into their chip sets. Thus, they have added chips that include MP3 players, GPS systems, WiFi, and many other capabilities. Here, as well, the company has demonstrated something of an ability to get into spats with other companies over patents as witnessed by the long and litigious conflict with Broadcom. Their success in grabbing more of the revenue represented by cell phone handsets and headend equipment will probably drive much of Qualcomm's growth in the future, especially considering that there may well be some market saturation issues regarding handset growth, at least in the developed and
BRIC countries.

Thus limns the potential business opportunity for Qualcomm, and how it manages to make the best, or worst, of it. How about its investors...? Qualcomm remains to this day a growth company whose stock is available today at an inexpensive price and cheap valuation; its current earnings peg its PE at a startlingly low 20! Factor in a growth rate of ~20% in revenues and net income, and investors find a company whose growth rate matches or exceeds its PE, a PEG of 1 or less. (This calculation ignores the intellectual property lawsuit with Nokia/NOK, and which Qualcomm appears to have the upper hand.) The basic question re Qualcomm remains whether its executives' always-present hubris ("Hey, we are Qualcomm, and we offer CDMA. Enough said!") will cause the company to snatch defeat from the jaws of victory.

The company's shares reflect this uncertainty...

[click on charts to enlarge]

Qualcomm/QCOM qualified easily as 1999's poster child for share price momentum and extreme valuation; the investor need only view the highlighted portion of the chart to see that. The subsequent 8 years have told a different tale, although the three-fold rise since July 2002 obviously offered a profitable entry. The question becomes whether the current chart foretells whether QCOM will recapture its lost glory as a market leader; a future I believe will come to be.

Consider, first, a crucial market perception by
Dorsey Wright (below)...

The Basic Principle of Chart Patterns
There is one principle that is basic to all stock charting: a stock will tend to continue in the same direction in which it is moving. Most chart reading is an attempt to determine as soon as possible what direction this is. Sometimes it is an attempt to predict the direction of a move, but this is most difficult and can be dangerous. Let us look at what actually happens before a stock rises or falls.

Typically, it will sell in a certain range for a relatively long period. We will assume that it is bouncing between 35 and 45. When it breaks out of this range, either up or down, the expectation is that it will make a considerable move. In retrospect this zone is termed an accumulation area if the price has gone up, and a distribution area if the price has gone down. These two terms are based on the assumption that the "smart-money" is accumulating a stock before it rises, and are distributing it before it falls. If the stock rises above the 35 to 45 range, it is expected to find support around the 45 level because investors who were tempted to buy the stock before its rise will recall this as being a favorable buy level. If it drops through the 35 level (violates support), the price is expected to fall substantially.

Let us suppose that the stock, after considerable fluctuation between 35 and 45, moves above this range. It is felt that the 35 level will provide support to a price decline, that 45 will be a demand area. Presumably, investors who felt they missed the stock when the price rose will be willing to buy their stock when it returns to this zone. Again, if the stock passes through the low end of this range, it should make a good downward move. Frequently, advocates of some technical method or other will get excited about a stock moving through a previous bottom or top. Such a breakthrough may be significant, but it is not necessarily so. The mere surpassing of a previous point is not important unless the breakout is from a clearly recognizable formation. Not only that but you must also note whether the stock is above or below an important trend line and also whether the relative strength is positive or negative.

And this market perception from Trader Vic, Victor Sperandeo (excellent information at the embedded link! - dmg), who discerned a bottoming process to be as easy as 123...
1) A market stops going down,
2) A down trend line is broken, and then
3) A successful retest to confirm.

Voilà, a 123 trend reversal. Note the chart of QCOM, below, but this time with trend lines included...

Qualcomm/QCOM builds a massive (mega) bottom; from its all time high at $100 in January 2000 to its July 2002 low. (Down a whopping 85%!) Even though one key trend line is not delineated (that would be "D"), investors can see readily that which Vic Sperandeo and Dorsey Wright seek -- a market in a discernible area pattern, and turning... up, into a 123 bottom, as QCOM shares slowly trade along the right (up-) side of its chart. (NB: channels AA, AB, and rising trend line C.) A price near $35 manifests as a low-risk opportunity to buy; upside breakouts lie at ~$43 and, crucially, at ~$54.

Markets, merchants, and merchandise

All measures of valuation, price, and trend are attempts to discern risk and opportunity. One item I always keep in mind is my role in the process of investing; stocks and markets do not abscond with my (portfolio) monies via some grand plan to steal from me. So as not to perceive myself a victim of random market oscillations, I perceive a set of three: markets, merchants, and merchandise. "Markets" are obvious: they provide a (continuing) venue for buyers and sellers to meet and haggle over price and value before exchanging money for goods. My role is as merchant; my merchandise the stocks I buy cheap today to sell dear later. Yes, I allow for interim oscillations between purchase and sale. The market is merely a venue, and not an intangible mechanism that sets prices; most investors allow the market to set their prices, whereas I set the prices for my wares (inflection points, or maximum points of risk and reward). The markets do not happen to me because I am the market, the market is me.

Okay, that bit of fractal analysis might seem confounding, perhaps daunting, and even foo-foo. Try this. Investors should always keep in mind timing, akin to real estate's mantra ("Location. Location. Location."). It is better to be in the wrong stock at the right time than the right stock at the wrong time. But for consistent success, and for the wind at your back, it is better always to be in the right stock at the right time.

And so we return full-circle to the original question, "Whether 'tis safe now to invest...?" And, although seemingly oblique, this post provides my answer. I invest in companies and their shares, not markets. While markets might create better opportunities via a combination of changing price and shifting time, they do not establish prices. We, you and I, do that.

Full Disclosure: Not long Qualcomm/QCOM, but will be soon.
-- David M Gordon / The Deipnosophist

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09 February 2008

Staredown with a Lion

Arguably having nothing to do with investing (I would argue otherwise), the selection below from Craig Childs's new book, The Animal Dialogues, decribes what it's like to confront the mountain lion, now America's No. 1 human predator, in all its terrible beauty.

I devoured this article, as it is exciting, riveting, and I just had to know what happened next. Read the article to learn what I mean.
-- David M Gordon / The Deipnosophist

Staredown with a Lion

I am one day by foot from the New Mexico border into Arizona's remote Blue Range. A mountain lion is at the water hole. It is a male, well over 100 pounds, lapping water from the edge. It does not know that I am here. I come on it from behind, staring a beeline down its long tail, which is laid flat against the ground. An early-morning breeze moves in my direction, taking my scent behind. I let down a 60-pound pack without making a sound. I focus binoculars to get a good look.

The mountain lion has been in battle. A long, old scar follows its right side. The males are territory defenders. They will fight over land and come out with ragged ears and torn skin. It looks healthy, though—a strong, agile lion, hunched to the water so that its shoulder blades form shields around its back. When it stands, it makes a careful visual sweep. I am blending into my background, and its eyes swing by mine, not lingering on me at all. It is keyed to motion and scent, and nothing registers. I look like a rock, a stump, something simple and expected. Even so, a shiver pounces down my back.

In America's suburbs and parks, mountain lions can be aggressive around people. Attacks are up. In fact, it is the mountain lion that has become most likely to make a meal of a human in North America. Close encounters in the deep wilderness are a different category. Concerning humans, lions out here avidly and skillfully avoid them. This is their territory, and I feel safe enough. I am dealing with precepts I think I understand.

The lion at the water hole eventually walks away, into a mesh of junipers that leads into the ponderosa forests and the high desert beyond. I wait for several minutes, then walk to the water to get a good identification, to take measurements and write it all down. The wind has shifted a few times, distributing my scent all over. But if I know the mountain lion, it is half a mile away by now, getting well out of my range.

At the water are many tracks in the mud, like sentences overlapping. I move to get a close look. Before I am on the ground, I scan the perimeter. At first I see nothing.

Then it is there, behind me. It has circled to my back. Eyes are in the shadows of a couple of low junipers, 30 feet away.

I move slowly, deliberately. The lion is probably startled by me. It may be hiding, like a rabbit that is nearly stepped on before it leaps away. But its eyes are not frozen like a hiding rabbit's, and its body is not bunched, ready for a line drive in the opposite direction. I am being observed.

I watch the lion, taking advantage of my proximity to study its features. I am expecting it to bolt any second, to dive into the woods and vanish. Remember this, I think. You will never be this close again.

Instead of running, it stands. Without a pause for thought, it moves out from under the shadows so that both of us are in the same sunlight. We make clear, rigid eye contact. It begins walking straight toward me.

My heartbeat lodges into my throat. My adrenaline dumps. All of it. No dilemma in the lion's eyes; it stares me down as if I am prey backed against a water hole. Even with a slow, lucid gait, it is quickly in my world. It looks up at me from under its brow so that its head is down and its eyes are shelved by a shadow. A stalking stare. The distance is closed in seconds.

The cat is going to attack me. I pull a knife off my right hip. It has a 5-inch blade. One claw against eight claws; hesitation against instinct. The advantage is not mine.

Mountain lions are known to take down animals six, seven, and eight times their size. Their method: attack from behind, clamp onto the spine at the base of the prey's skull, snap the spine. The top few vertebrae are the target, housing respiratory and motor skills that cease instantly when the cord is cut.

Cats have attacked people who have been crouched, or small, or running the other way. Even in zoos they sometimes charge at the cage when children come by. Parents are often asked to hold their children close as they pass cages, to break up the image of fast little kids making random movements. Mountain lions have stalked people for miles. One woman survived an attack and escaped by foot on a road. The lion shortcut the road several miles farther and killed her from behind.

Bone is rarely ever broken. Rather, the teeth slide between vertebrae and open the spine surgically. Cat teeth are heavily laden with nerves so that the animal can actually feel its way around the spine and find the area for incision.

The mountain lion keeps walking straight at me. A powerful voice in me says, Run!
Find shelter! The voice wants the mountain lion magically gone, it wants me to flee to my pack and bunch into a tiny ball. The lion is pushing my button, scrambling the innards of my instinct. Never have I felt fight or flight like this. My only choice, the message going to the thick of the muscle in my legs, is to run.
I've got to get out of here before it's too late.

hat I do, instead, is not move. My eyes lock onto the mountain lion. I hold firm to my ground and do not even intimate that I will back off. If I run, it is certain. I will have a mountain lion all over me. If I give it my back, I will only briefly feel its weight on me against the ground. The canine teeth will open my vertebrae without breaking a single bone.

Some of the larger animals push their faces toward an attacking lion. It can't get anything at the face. It has got to have a clear shot at the neck, from behind or the sides. It tries to intimidate and push the panic button with this kind of doubtless approach so the prey will turn. When the prey runs, the kill is sealed.

The mountain lion begins to move to my left, and I turn, keeping my face on it, my knife at my right side. It paces to my right, trying to get around on my other side, to get behind me. I turn right, staring at it.

Earlier I would have raised my arms and barked at it, but the lion had come too fast. Now any motion could snap the space we have. My stare is about the only defense I have. People working alone in the mangrove jungles at the mouth of the Ganges River in India sometimes wear the mask of a face on the back of their head. John Seidensticker, who studied the social organization of mountain lions, suggests that humans began to stand upright in order to more vividly show their faces to aggressive cats and to appear less like four-legged prey.

Most of my body has stopped. All that is left are my eyes, my right hand with the knife, and my ability to turn. The lion comes left again. When I rotate, it stops walking. It has got me in a stationary, tight stare from 10 feet. Its nose is moist and pale. Eyes made of gray and green. And that is where I see all of the energy, bound up and ready to flush into the body for one quick jump.

If it jumps, the knife goes into the rib cage. All my energy will be in the thrust. The lion may reconsider after that. But what shape will I be in after the single blow its entire body is built to deliver? Fifty million years of evolution to make an animal designed to kill on the first move. It could be that I will get in a good knife jab, but what will its jaws do around my face and throat? What will its claws do? And mountain lions are known to come back. They do stalk. Will I be holding my skin together with hands and bandanas when it finds me again?

It is looking for the approach. It looks one way, just a couple of inches to one of my sides, and then it looks to the other side. I won't give it leeway, moving my head to keep its eyes on mine. There have been cases in which a lion cleared 20 feet in about a second when eye contact was broken.

It steps to my right, coming clear around, and I synchronize myself with it. It is not focused on my knife, my body, or even my eyes. It is moving intently at some point through me, inside of me, perhaps the single point where life itself is seated. It has happened so often that a mountain lion has launched straight at a hunter or a field biologist who has a sidearm leveled at its head. The mountain lion does not stop and is shot point-blank, dead. Why is that? A coyote or a bear will know when a person has a gun, and will often behave much differently. But the mountain lion is a creature with too great a nature to see a gun or a knife. It is so focused that the rest of the world goes silent.

The distance between us increases slightly. The lion walks toward the water hole. Until now I haven't had the room to take a good posture without triggering an attack. It is customary to throw up your arms and make noise when encountering an aggressive animal at a fair distance. Or to put your hands in your pockets and flare out your coat, making yourself look 100 pounds heavier. It is an old bluff trick. Usually works. Now that it is 15 feet away, I lift my hands in the air. All the way so that my knife is an arm's length over my head, looking like something too unusual and unknown for a mountain lion to bother with.

It doesn't work. The mountain lion swings back and comes straight at me again. My arms drop. Fast. Right to my sides. Ice comes down my back. The lion stops there, close again. I have never been watched like this.

It begins a long, winding route, still trying to come from behind. It covers a great deal of space, going back and forth. There is a seamless continuum from the surrounding world, through the lion's eyes, into its heart, and back to the world. I am somewhere in there, holding steady like a rock planted beside the water hole. It watches me closely as it leaves. It walks into the forest and I no longer see it.

I stand for a few minutes, staring at the forest.

never saw the lion again. For the next week of hiking, though, I could see it all around me. I slept half awake. When I came to water, I gathered it quickly and retreated. I kept my eyes trained into the shadows, waiting, seeing a mountain lion wherever I looked.

From the book The Animal Dialogues by Craig Childs. ©2007 by Craig Childs. Reprinted by permission of Little, Brown and Co., New York, N.Y. All rights reserved.

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08 February 2008


I keep forgetting that I always have new readers, readers not familiar with my market perceptions. Thus, when I said yesterday morning,

and the increasing ugliness of the charts..."

that comment speaks directly to my perception that, the more obvious a trend, the more likely it is to end soon.

And that is precisely what seems to occur now: the market is turning... up. Certainly, this painful, ferocious decline rapidly becomes a thing of the past.

-- David M Gordon / The Deipnosophist


07 February 2008

Crème de la crème

No doubts about it, the current market environment is difficult. No strategy works, as every opportunity is taken behind the woodshed, where it is bludgeoned, shot, and then decapitated. But the cream always rises to the top, and stocks are no different. As ugly as the markets appear now, this decline merely creates the opportunities from which investors will profit.

And no doubt about this either, my Core Opportunities are getting creamed. Apple/AAPL, Google/GOOG, Intuitive Surgical/ISRG are each caught in individual bear markets, and now Chipotle/CMG nears its breakdown. Does this recent share price weakness somehow equal that their businesses suffer from a sudden turn for the worse? Or do their share prices decline because that is what stocks, and markets, do on occasion?

Despite the ferocity of this decline, and the increasing ugliness of the charts, I believe the markets near a major low, especially when coupled with increasingly compelling valuations (PEs, PEGs, etc) due to the share price drops and still increasing earnings. Google/GOOG certainly ranks as an especially compelling purchase; the opportunity to purchase shares of a company that grows as fast as it does -- a PE of 30 for a company that grows in excess of 30% per year?! Hmm. A reader forwarded the following article (minus its provenance, alas)...
Microsoft's Yahoo Gambit
February 5, 2008; Page A17

Sunnyvale, Calif.

Yahoo, be coy, but take the Microsoft deal.

Microsoft's interest in buying Yahoo had been rumored for so long that when the bid -- $44.6 billion -- was finally made last week, it managed to surprise just about everyone in the high-tech world. With merger rumors fading and Yahoo slumping, it was generally assumed that cofounder and CEO Jerry Yang and his team were hunkering down to cut their losses with layoffs and then embark on a major re-organization.

Microsoft's offer has changed everything. Within minutes after the news broke, the mainstream media and the blogosphere were on fire with speculation on what it all meant. Here in Silicon Valley, and other high-tech enclaves around the world, the debate was a welcome respite from the increasingly depressing news that always accompanies the industry'squadrennial slide into recession.

The announcement also brought to the surface a lot of old emotions,
including Silicon Valley versus Seattle, corporate capitalism versus
entrepreneurship -- but most of all, the fear of Microsoft as an unstoppable force crushing all competitors before it. Pundits instantly started asking if the feds would even allow such a merger. Meanwhile, at Yahoo's photo-sharing subsidiary Flickr, members are throwing a collective (and characteristically clever) tantrum about being handed over to their new overlords.

The low point came on Sunday when David Drummond, Google's senior vice president and chief legal officer, darkly summoned the ghost of Microsoft past. "Could Microsoft," he asked ominously on the company's Web site, "now attempt to exert the same sort of inappropriate and illegal influence over the Internet that it did with the PC?" He was dangling the bait in front of the Federal Trade Commission to see if it would nibble -- all while conveniently ignoring the fact that if there is any monopoly at work in the digital world these days, it is Google's absolute dominance of Internet searches. Its market share surely equals IBM in computers, Intel in microprocessors and, yes, Microsoft in PC operating systems at their peaks.

Still, you can understand Google's paranoia. Company CEO Eric Schmidt has twice fought Microsoft in the past -- at Sun and Novell -- and been crushed both times. At Google he has triumphed at last by forcing Microsoft to play to his strategy, only now to see Microsoft try to change the rules. That's got to make you sleepless and edgy.

The rest of us don't have the same excuse. Years ago on a Sunday morning news show, Bill Gates made perhaps his most prescient comment ever. If you look at the history of technology companies, he said, none have ever been able to stay at the top for long. This is Microsoft's moment, he continued, but it won't last forever.

He was right. If you look at Microsoft with an objective eye, it becomes apparent that it is a giant company past its prime. It is big and rich, but increasingly toothless. It is able to use its money to put on a great show at the Consumer Electronics Show, underwrite an interesting market initiative -- or buy another big company -- but it no longer has the fire of ambition or the addiction to risk to ruthlessly execute on those desires any more. As has been noted before, once you look past all of the high profile moves (such as MSN, MSNBC, Zune and XBox), Microsoft has only really been as successful as it reputation would suggest in just two businesses: Windows and Office. Most everything else is flash.

Even Microsoft's full-out assault on Netscape (which, ironically, will officially die on March 1) for control of the Internet browser industry -- justly earning it the sobriquet "Evil Empire" -- in retrospect was less a brilliant maneuver by Gates & Co. to capture a hot new industry and more a desperate (and questionable) scramble by a market leader caught napping.

That corporate somnolence, rather than its more-remembered ruthlessness, has far better characterized Microsoft over the past decade. Even the Vista operating system, the most recent upgrade of Microsoft's core product line, managed to be so late that it almost crippled the personal computer industry. It finally arrived to a chorus of boos, most of them undeserved (it's a pretty good operating system), but some dead-on (it's a technological hop when it should have been a leap). Microsoft lost its killer instinct a long time ago. On the rare occasions when the mood resurfaces, the company doesn't have the chops anymore to execute on its desires.

And that brings us to the Microsoft-Yahoo deal. For all of the excitement, this is just big, rich, but slow-moving giant looking to buy another slow-moving giant, the latter having stuck to an obsolete business plan too long and lost its way. The scheme is less predation than it is desperation: In the world of search, Google owns these two lumbering monsters.

Microsoft understandably covets the sheer size of Yahoo's subscriber rolls, believing it can accomplish what Yahoo has failed to do: convert more of those 130 million monthly visitors into real, paying customers. But Microsoft has hardly shown it can do that at MSN. So, can it really find a solution to Yahoo's structural problems?

That remains to be seen -- and Microsoft's one genius is as a late adopter. The real problem Yahoo -- and perhaps soon Microsoft -- faces is that those legions of Yahoo users don't want to be stuck inside a small corner of the Web, not getting all of the experiences and services (like live TV and first-run movies) they were promised. Especially not when they can run around and find all of those things, in abundance, elsewhere on the Web. Microsoft is even less prepared to solve that problem than Yahoo.

That leaves search, which is probably the real reason Microsoft wants Yahoo. Combining the two search engines would, in terms of sheer numbers, represent the biggest challenge to Google to date. But the sum of two also-rans is almost never a winner -- unless the newly merged is very, very lucky in its competitors. That's what happened with HP and Compaq: Who'd have guessed that Dell would suddenly fall on its face?

Incredibly, the same may happen with a Microsoft-Yahoo deal if it happens. If you look at the stock market, peruse the industry gossip blogs, follow the departure of key employees, or read about the various new initiatives (energy?) the company is pursuing, it becomes increasingly apparent that Google is a company about to have an early midlife crisis. Microsoft-Yahoo may turn out to be a pedestrian idea with absolutely brilliant timing.

If that is the case, and the merger proves successful, it will have more to do with Google than Microsoft and Yahoo. Which is why the Feds should stay out of it.

So, Yahoo: Take the deal (unless a better one comes along). Microsoft: Let this be the first of many high-risk moves. Treat Yahoo as a heart transplant, not a skin graft. And Google: This new competition should be a warning to stop fooling around and get back to business.
"If you look at Microsoft with an objective eye, it becomes apparent that it is a giant company past its prime. It is big and rich, but increasingly toothless..." Does that statement not sum up the truth of the situation? I argued this point re VMWare and virtualization, but to no avail; the markets trembled.

I am an investor, so share price declines afford my portfolio the opportunity to invest in favorite long term investment opportunities at compelling prices and valuations. It happens that I like Google/GOOG, a lot. (What a surprise, David!) Thus, I seek an opportune moment (a lower share price?) to purchase more shares.

The cream does not get any more yummy than this.

Full Disclosure: Long Google/GOOG.
-- David M Gordon / The Deipnosophist

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05 February 2008

The last grain of sand

It seems that no matter how much or little I struggle and squirm, I cannot escape the many upsets that life besets upon us all. Really, is it too much to ask for some calm, some quiet, some serenity? Perhaps even to find happiness and contentment with(in) yourself...?

Enough bellyaching. I leave you with three brief poems that seek a common theme. Can you see it...?
-- David M Gordon / The Deipnosophist

Love Poem with Toast

Some of what we do, we do
to make things happen,
the alarm to wake us up,
the coffee to perc,
the car to start.

The rest of what we do, we do
trying to keep something from doing something
the skin from aging,
the hoe from rusting,
the truth from getting out.

With yes and no like the poles of a battery
powering our passage through the days,
we move, as we call it, forward,
wanting to be wanted,
wanting not to lose the rain forest,
wanting the water to boil,
wanting not to have cancer,
wanting to be home by dark,
wanting not to run out of gas,

as each of us wants the other
watching at the end,
as both want not to leave the other alone,
as wanting to love beyond this meat and bone,
we gaze across breakfast and pretend.

-- Miller Williams


So often it has been displayed to us, the hourglass
with its grains of sand drifting down,
not as an object in our world
but as a sign, a symbol, our lives
drifting down grain by grain,
sifting away - I'm sure everyone must
see this emblem somewhere in the mind.
Yet not only our lives drift down. The stuff
of ego with which we began, the mass
in the upper chamber, filters away
as love accumulates below. Now
I am almost entirely love. I have been
to the banker, the broker, those strange
people, to talk about unit trusts,
annuities, CDs, IRAs, trying
to leave you whatever I can after
I die. I've made my will, written
you a long letter of instructions.
I think about this continually.
What will you do? How
will you live? You can't go back
to cocktail waitressing in the casino.
And your poetry? It will bring you
at best a pittance in our civilization,
a widow's mite, as mine has
for forty-five years. Which is why
I leave you so little. Brokers?
Unit trusts? I'm no financier doing
the world's great business. And the sands
in the upper glass grow few. Can I leave
you the vale of ten thousand trilliums
where we buried our good cat Pokey
across the lane to the quarry?
Maybe the tulips I planted under
the lilac tree? Or our red-bellied
woodpeckers who have given us so
much pleasure, and the rabbits
and the deer? And kisses? And
love-makings? All our embracings?
I know millions of these will be still
unspent when the last grain of sand
falls with its whisper, its inconsequence,
on the mountain of my love below.

-- Hayden Carruth

Nothing Is Lost

Deep in our sub-conscious, we are told
Lie all our memories, lie all the notes
Of all the music we have ever heard
And all the phrases those we loved have spoken,
Sorrows and losses time has since consoled,
Family jokes, out-moded anecdotes
Each sentimental souvenir and token
Everything seen, experienced, each word
Addressed to us in infancy, before
Before we could even know or understand
The implications of our wonderland.
There they all are, the legendary lies
The birthday treats, the sights, the sounds, the tears
Forgotten debris of forgotten years
Waiting to be recalled, waiting to rise
Before our world dissolves before our eyes
Waiting for some small, intimate reminder,
A word, a tune, a known familiar scent
An echo from the past when, innocent
We looked upon the present with delight
And doubted not the future would be kinder
And never knew the loneliness of night.

-- Noel Coward

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03 February 2008

Message From Your Heart

Talent, it seems, runs in the family.

Many readers will recall the insights of Scott Grannis, the Chief Economist at Western Asset Management. But the talent at Scott's family runs deeper; Scott's niece, Kina Grannis, has just won the Doritos competition; As a result, her winning song aired during last night's Super Bowl...

Kina now has a recording contract (with Interscope), and many other videos of her songs are available on her websites. I suspect we will hear more, much more, from Kina in the future.

Congratulations to Kina, and the entire Grannis family!
-- David M Gordon / The Deipnosophist

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02 February 2008

Getting Things Done

David Allen, and his Getting Things Done, have danced in my consciousness for nigh on 2 years. Alas, that was all I knew; I had failed to discover more.

Until now. Thanks to this ~46 minute video of his presentation at the Googleplex, and that really does not get going until ~20 minutes in, I know a whole lot more. GTD is more, much more, than my assumption about a master to-do list; it is about ordering chaos at work, and in your life. I already use -- and of my own creation but nonetheless enjoy -- his Matrix and notion of clear space. Yes, it all is common sense, I suppose, but when has "common" ever meant used?

David's approach, as he says in the video, is system agnostic. Which means no more complaining; watch the video, and then change your life. Now.
-- David M Gordon / The Deipnosophist

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