Tuesday, July 6, 2010

News and views, July 6

Distressed Assets and Foreclosures

Since everybody seems to want to get into the distressed asset business, I thought it would be useful to include an excellent e-cast on the subject. (My thanks to the Berdon LLC firm for allowing me to publish this.)

The Death of the American City

My wife and youngest son have a quest to visit every major league baseball stadium in America. This quest has taken us to many of our country's cities. Being a native New Yorker, I typically envision cities as being centers of bustling activity and commerce. My visits to other cities in the country have shown me that often my vision could not be further from the truth. Many downtowns become virtual ghost towns in the evenings and on weekends. It is very strange to wander these downtowns on a beautiful weekend day and rarely see another person. What is the cause of this phenomenon?

One culprit is the automobile and the creation of the Interstate Highway system in 1956. At the time of its creation, the Interstate Highway System was thought to be critical to our national defense by enabling troops and military supplies to move freely and quickly around the country in case of an emergency or foreign invasion (while that may sound silly today, let's not forget that this was during the height of the Cold War). In response, governments constructed elaborate highway networks in and around their cities' downtowns which, rather than facilitating the movement of troops and supplies, encouraged the flight of the middle and upper class to the ever widening bands of suburbs being developed in the surrounding areas.

Cities began to lose their lifeblood as a result of automobile culture, and as they did, tax bases eroded, services were cut and taxes increased- accelerating and perpetuating an upper and middle class exodus. As we become more attuned to the destructive effects of automobile-created sprawl on communities, culture and natural resources, we must invest in our mass transit infrastructure to reverse it, cultivating an urban density characterized by shared resources and integrated communities. A beginning of this reversal trend can be traced to the artists and urban pioneers who have adopted many cities' deserted and deteriorating neighborhoods, often out of necessity, revitalizing some of the most desolate, underused urban territories that have now become vibrant and valuable parts of the cities' fabric.

A Radical Proposal to Remake Government

I, like many of you, pay a lot in taxes. It seems that our elected representatives look at us as ATM machines available 24 hours a day/7 days a week to pay for their pet programs. It's not that I necessarily disagree with the purposes of their programs but rather more a belief that governmental agencies are so grossly mismanaged that much of our tax dollars are wasted. For me, it is not necessarily that I would like to keep more money for myself, after all even after I pay my taxes every year I still contribute significant amounts to various charitable organizations. It's that every time I read a story about non-competitive bidding for multi-billion-dollar defense contracts, $200,000 annual pension payments to government workers and the like, I cringe. So the question is: what can we do to incentivize our government to spend our tax dollars as frugally and wisely as we would if we were spending it ourselves? Privatization is a partial answer but not always satisfactory when it comes to providing quasi governmental services that serve the public good but do not generate a profit. My suggestion: allow taxpayers to take a dollar for dollar credit against their taxes (as opposed to the current deduction that the tax code allows) for any contributions they make not for profit organizations that provide quasi-governmental services. Not only would this force government to be more competitive and pay more attention to the bottom line, it would also give taxpayers substantially more control over how their tax dollars are being spent which may actually encourage even more giving than would otherwise be collected through taxation. Obviously, there are numerous issues that would have to be addressed in creating such a system but encouraging competition with government would go a long way to compel a government to function more effectively and efficiently.

Interesting Fact: Persistence Pays Off

Other than the presidency, Abraham Lincoln lost every election in which he ran.

Pigeon Poop: Some Interesting Facts about these Ubiquitous Birds or "Always Look-up as you walk"

  • Number of pigeons in greater New York City area: 7 million
  • Number of pigeons served in both world wars, as messengers: 1 million
  • Pounds of pigeon poop produced yearly per pigeon: 25 (do the math-that's a total of 175,000,000 pounds of pigeon shit produced every year in New York City. I shudder to think where it all goes!)
  • Miles per hour on pigeon can fly: 60 (the fastest animal in the world, the cheetah, can run up to 70 mph)
The Smarter Planet

For the first time in history more than one half of the world's population lives in cities. By 2050, that number could rise to 70%. IBM has created a really cool website showing their perspective of the future of cities and the earth. If you thought Fritz Lang's movie "Metropolis" was really cool you should definitely check out this website.

Recommended Websites

Occasionally, I come across websites that are particularly useful:

Cheap parking: For cheaper parking rates and discount certificates check out www.bestparking.com.

Great productivity tool: this website allows you to dictate memos etc. into your cell phone and have them transcribed and e-mailed back to you as text. Accuracy is pretty good.

A Personal Story

If you have a child who is struggling with a learning disability, this article recounts our family's experience struggling with -- and ultimately conquering -- our oldest son's learning disability.
Our son is now 19 years old and is a very successful student at University of Vermont. This article reminds me of the difficulties we experienced in dealing with his learning disability but also the tremendous gratification we felt on his success. I couldn't be prouder of my son for his accomplishments.

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