Glitter and Doom on Fifth Avenue

"Glitter and Doom, German Portraits from the 1920's" is an exhibition of Weimar Republic era paintings and drawings now on exhibition at the Metropolitan Museum. The societal and behavorial chaos that followed World War I is documented. The portraiture displayed is at times bizarre, humorous, provocative, and riveting. Otto Dix dominates the show. His "In Memory of the Glorious Time" shows two grotesquely disfigured WW I veterans dressed in uniforms to commemorate the war. "The Poet Iwar Von Lucken" is a caricature of an eccentric Baltic baron and poet that somewhat fondly captures a recognizable posture. The portrait of "Dr. Heinrich Stadelmann", a psychiatrist, has eyes that are cartoonishly exaggerated, but nevertheless real.

The overall exhibit provides interesting history and for the most part savage caricatures as art. There are some respites from this as in "Sonja" a 1928 work by Christian Schaad that portrays a seated woman in a cafe with a cigarette holder, a pack of Camels on the table, and a champagne bottle and bucket behind her. Her glare is mesmerizing. Unfortunately, unlike most exhibits, there were no postcards of these works. As much of the work displayed is not well known, and some like "Sonja" and "The Poet Iwar Von Lucken" are immediately arresting, postcards would have been a treat. Guess that's just my bridge and tunnel comment.

"Villagers Block Gypsies Return To Their Homes"

On Page A7 of the NYT today this headline, which began "In Slovenia...", described an extended family of 31 Gypsies who were met by about 1000 villagers who blocked roads when they tried to return to their homes(I am reminded of a scene from the "The Beauty and the Beast" animated feature). The family was evicted from their home one month ago when a Slovene who they had allowed to live with them got into a bar fight and injured another Slovene. After mobs surrounded their house at that time, the government made the family leave. The government had planned to move the family against their wishes to a suburb of Ljubljana(the capitol city), but had to withdraw when the citizens of that suburb protested. Confined to living in an army barracks for a month, the family returned to their home without asking, and were met by the mob. They were turned back, and later told that despite the fact that they owned the land that they were returning to, they had no right to it since they had not obtained proper permission from the housing authorities to build their homes.

Since this is "news" in the NYT, is it an unusual occurance. It is not. I recently read "Bury Me Standing, the gypsies and their journey" by Isabel Fonseca. This book is a remarkable combination of history, folklore, current events and investigative journalism that tells a story of persecution over centuries. Gypsy poverty, illiteracy, unemployment, and early death are all record breaking within Europe. They are certainly the largest minority in Eastern Europe, perhaps all of Europe.

What has happened to this minority, as detailed in Fonseca's book, is that they have been relegated to some cultural blindspot as a result of a multi-century process, and even in socially progressive western Europe their issues are below the surface. In Eastern Europe, this example from Fonseca's book is noteworthy.

A government pamphlet called Romania's Population published in 1972 found that "Romanians, Hungarians, and Germans were found to account for 99% of the population, the remainder comprising other nationalities including Ukranians, Serbians, Croats, Slovaks, Russians, Turks, Jews, etc." Gypsies were etc. In a 1992 census they were found to be 15% of the population. But in a way Gypsies seem to be viewed as a stateless people that don't exist, especially in Eastern Europe where they live in large numbers.

The persecution of Gypsies continues, and "Bury Me Standing" delivers the story, which did not stop in 1995 when the book was published. It's a first hand account of life with Gypsy families that can make one feel that they are taking a small step into understanding the Gypsy culture. Combine that with a history of their migration from India many centuries ago, and the centuries of being viewed as either a slave or pariah in Europe and it's a fascinating story. Today this is still an open issue and a complicated one given the proud, insular and unique culture of those concerned. There are more than 12 million Gypsies in the world today.

TD Banknorth Garden

At some point the corporate naming of sports venues was going to go too far. Many people have favorite examples that make them laugh or cry, but this one is just astonishing. The fabled Boston Garden is now TD Banknorth Garden.

TD Banknorth is a northeastern U.S. retail banking franchise that is based in Portland, Maine and is majority owned by a financial services holding company in Toronto, Canada. Now there's a real association with Beantown for you. Apparently no one in Boston uses this name in conversation, absolutely no one. It's just "the Gahden" as they say.

Corporate naming of stadiums and arenas has been with us forever as in Busch Stadium and Wrigley Field, named for their owners whose names were synonymous with their companies. The practice is now ubiquitous and with us to stay. But when the naming moves into the realm of the absurd as it has in Boston, it is a joke and the joke is probably on the corporation that is paying to be laughed at, derided or ignored.

Will someone dare to go for Fenway? What about Walmart Park. That's just what they need. Any ideas?

Iraq disintegrates

It appears that an all out civil war has begun in Iraq. Not only did Bush hear and Rumsfeld feel the U.S. election results as they should have, the Iraqis watched as well. What they saw was that the leaders of the U.S. war commitment had been rebuked and the clock is ticking on the level of U.S. involvement in Iraq. The Sunnis are panicked and on the attack. The Shiites see the opportunity to be more aggressive. With yesterday's bombing in Kurdish northwest Iraq, someone is attempting to draw them into this mess.

The world community outside of the Middle East is standing back, staying clear of flying glass. Any hope that the Bush administration finally might try, at least through back door channels, to get Syria, possibly, or Iran, however unlikely, to aid in negotiating some kind of truce now seems impossible after the assassination in Lebannon.

If there are a few more weeks on this path of escalating "terrorist" and "militia" violence, these events will just be combat. Bleak situation.

Tar Heel gets New Yorked

There is an article in the NYT sports section today discussing the poor performance of UNC basketball star Tyler Hansbrough in UNC's loss to Gonzaga in the NIT Season Tip-Off tournament at Madison Square Garden. It's a good article and it gave enough information to pinpoint exactly what happened to the player even if the writer didn't get it. Hansbrough got New Yorked.

The Carolina players went out walking in Times Square. Manhattan is sensory overload. The stimuli to sight, smell, touch, and sound are omnipresent. It takes a toll. In the early 1980's shortly after I moved to Manhattan a friend who lived in a large regional Southern city, who was well traveled and knew New York came to visit me for a long weekend. After heading out from my small apartment for touring in the morning, we returned in the early afternoon and he immediately laid down on the sofa, ran through the remote until he found a Beverly Hillbillies rerun, and went comatose. New York can be overwhelming. Committed Manhattanites leave the city in droves every Friday afternoon to get a recharge from the intensity.

On top of that, I doubt that UNC houses it players at hotels like the Four Seasons, St. Regis, or Mandarin Oriental where the soundproofing insulates you from the cities constant hum or worse. Even normal good hotels are not removed from the street sounds below.

So the simple but correct answer to the heretofore inexplicable performance of the young man from Poplar Bluff, MO who now lives in Chapel Hill, NC is that his energy was sapped by New York. One of Gonzaga's players is quoted as saying that "in the second half he didn't even attack". Hansbrough said that he was not nervous and couldn't explain his "horrible" play. It's a long way from Franklin Street to Broadway.

"What is the What"

What words does one use to describe the new book by Dave Eggers "What is the What". Powerful, heartbreaking, informative, and intelligent come to mind. The writing is clear, unassuming and literate. This is an important book. An awake person should consider buying it. If read, it will likely be compelling and perhaps inspiring. If not read, that's ok, as all the proceeds from the book go to Sudanese refugees in America, the rebuilding of southern Sudan, and to organizations working for peace and humanitarian relief in Darfur.

"It is no way to live, to wait to love." Valentino Achak Deng, "What is the What", page 318

Modern life

Several days ago my phone line in the house went dead. I called Verizon and arranged for an appointment today. They said that someone needed to be home from 8am to 6pm. Annoying but I cleared whatever calendar I had because we need both that line and the family line, especially at Thanksgiving. This morning I called hoping to get a more defined window of time for their repair visit. At this point they did some line testing and said they would likely be able fix it without coming in the house and so I did not need to be here. Since I had already arranged to be here and we needed the line I asked that I still be given a time window because I wanted to make sure that service would be restored. The Verizon agent then informed me that it may not be restored today. Me, "Why not?", Verizon Man, "Because sir, it's a line problem and we have over 1000 lines to restore.", Me, "But you're a big company with over 100,000 employees and I was told that it would be repaired. 1000 does not mean anything.", VM, "But it's Thanksgiving week and our employees do get to take vacations(patronizing tone creeping into VM's voice).", Me, "So is there a chance that it will be restored today.", VM, "Not really, maybe Friday.", Me, "Do you mind if I write about this on a blog.", VM, "No, the company encourages that(sarcastic tone emerges).", Me, "Ok, thanks for the help(sarcastic tone returned)".

Last Friday I received a notice from the New York State Department of Taxation. It said that after a review of my 2003, yes that's 2003, state taxes that I owed some additional tax as a result of an error on my return. There was an amount required for back taxes plus a cumulative 30% interest penalty for the money that I was unaware that I owed for the last two and a half years. The notice did say that I could dispute their claim if they received a letter from my brokerage firm disputing their findings, but the amount was relatively small and the detail of their review seemed to be a logical finding of an honest mistake. Who possibly has the time or patience to dig through their taxes of three years ago and to protest if it is not especially material. 2003? And penalty interest at almost double market rates? I signed the form. I wrote the check. I'll wait for the 2004 results in 2007.

We received a notice for a maturing CD at Chase a few days ago. It said take action or there will be an automatic rollover at their prevailing rate for the same maturity. Annoying since when we opened the CD I specifically requested that the automatic rollover feature, that classic retail bank ploy, be waived. They agreed, the system apparently did not. Chase's letter said that if we wanted to check the rate now offered that we call an 800 number. Did so, but they would not provide a rate for that maturity--said we had to speak to our branch. Went to the branch. The rate would be 4.25%, 85 basis points below the current market rate. Here's the trick. We originally entered into a 7 month CD because of the excellent rate that was at 4.4% slightly above market at that time. So now their plan with us and all others who entered into this rate was to catch us big time with a much lower rate. I do understand that most banks today of good size do really serious statistical and actuarial analysis of all of their retail bank offerings to deliver the most attractive appearing, most competitive(against their competitors) and most profitable product. These models can be managed to look at short term or longer term performance goals. Chase is obviously on the short term end at the moment. With a grace period of 10 days before a rollover locks in, they will have models that show what percent of customers will likely take the time to stop the rollover or look for a better rate at Chase or elsewhere. They, through their phone networks refusal to provide rates, discourage their customers from taking the time to focus on this and actually visit the branch during their work day. I am certain that their models actually take into account seasonality and, in this case, it is Thanksgiving week. These models are designed by highly educated mathematicians, not the guys and gals smiling behind the counters at your local branch. So I did take the time to visit the branch and, when I pointed out the ignoring of the no rollover request, the refusal of the suggested call center to provide rates, the ridiculously low rate that I found and the inconvenience of all this to the customer, my "personal" banker tried to explain away each point, and then finally said "you know banks are in business to make money". He said it twice in a row as if that was checkmate. I then noted that the best companies in any industry are in business to build long term relationships with good customers, of which I am one. "Just call me back and I'll take care of things anytime." he said. You may think that at each one of these points any bank that behaves this way is just incompetent, at every point of contact. Believe me, they are not.

Last Thursday we received delivery of a new double wall oven, a new induction cooktop, and a new dishwasher. We bought a used house, 1974 model, in 1997 and these appliances were vintage, ugly, and no longer working in some respects. People in real estate say that a definition of penny wise pound foolish if you ever plan to sell your house is to go cheap on a kitchen. So we're lucky enough to be able to afford top of the line stuff and we bought it. We can enjoy it now and someday later someone else will hopefully have helped us pay for it. It's beautiful looking stuff. The installation went perfectly. Unfortunately the oven and stove don't work. Actually three of the five fascinating electromagnetic burners on the stove do work, but two don't and we learned that at installation. After some discussion and my being arrogant enough to withhold paying for it, the retailer said that the manufacturer would replace the entire unit in a few weeks. During the weekend the ovens manifested their weaknesses. The time the ovens take to heat to just 350 degrees range from 25 to 45 minutes even as the colorful display screen says they are ready in about 5 minutes. We had some dropped cakes. The Max Broil setting turned a steak light brown after 2o minutes, soggy and still not fully cooked. The convection cooking baked cookies in different parts of the same oven from toasted, to just right, to barely cooked, all at the same time, an unusual feature. We left voice mails on the weekend, and when the dealer opened on Tuesday I called and received defenses on every issue. We then drove to the retailer for further discussion. I raised the issue of a 7 day or 14 day return policy and they acted as if that was unheard of. The attitude was almost one of "if you can afford this stuff you shouldn't be bothered by these minor issues". Our salesperson is knowledgeable but is one of those people who interrupts you mid-sentence and then will not stop saying whatever comes into her mind until she has to breathe again, usually after about five or six sentences. They finally believed that we were not cognitive dissonance crazies and arranged for a service rep to visit Monday to "recalibrate" the ovens computer. "Recalibrate". A word like that scares me. Long ago I had a friend who worked as a one man night manager of a small Trailways bus station and I would occasionally visit him at work. Whenever bags were lost he would, after some patient discussion on his part at least, always say they had a "tracer" on the lost luggage. That seemed to placate most people. I once asked him what a "tracer" meant. It means we don't know where the luggage is he said. "Recalibrate". We'll see. We haven't even tried the dishwasher yet because, after so much time with the oven and stove manuals, we haven't been able to force ourselves to pop the plastic on that one. After Thanksgiving dinner, a dinner which promises to be an adventure to produce, we will give it a try. I know that all of this will work out in some way, and I have documented all of this, dates, temperature tests, etc. in an e-mail to the dealer so I can make sure things will ultimately be the responsibility of the manufacturer, but what an agitation, especially obsessively going through the oven's computer-like manual for three days before finally deciding absolutely that we weren't stupid, the friggin' thing did not function right.

Quite a bit of these four episodes may seem like they have a theme of money and to a minor extent they do. But the real theme is agitation and distraction. Modern life. May you take a break tomorrow and have a Thanksgiving free from this modern life.

Mutual fund challenges

With the Dow up over 13% year to date and the S&P over 11%, mutual funds are in many cases looking at a pretty big miss of their benchmarks. Large cap mutual funds that should be compared to these indexes are challenged. A few examples:
Marsico Focus Fund -- ytd return of 3.5% and it has a 1.25% expense ratio
Goldman Sachs Capital Growth -- ytd 7.33% with a 1.49% expense ratio
Neuberger Berman Century Fund -- ytd 6.7% with a 1.47% expense ratio

These are big misses in the works for funds that investors pay well for their "expertise". And the shortfall is not just limited to those who charge a lot. A few more examples of funds whose expense ratios are in the 60 - 80 basis point range:
Fidelity Magellan --ytd 5.15%
Fidelity Contra -- ytd 9.87%
Janus Growth and Income -- ytd 6.8%
Janus Fund -- ytd 8.62%

In fact, any U.S. large cap fund that beats its index by any amount will easily be in the top 25% of mutual funds for the year. This is not at all good for the fund industry, with ETF's indexing the various large cap markets at expense ratios from 12 to 40 basis points, and some firms, Fidelity is an example, offering select index funds at a 10 basis points(.10%) expense ratio. It's difficult to make an argument for the discretionary fund manager's value when the performance is lower and the cost for their work is higher, at times much higher.

Why has this happened? Indexes have not usually outperformed in recent years. To be fair to the seven funds that I listed, Marsico and Fidelity Contra have outperformed indexes consistently over the prior three years and Janus Growth and Income has kept pace. The other four have not. But why has this year been a fund manager's headache. A few reasons:
---Large cap technology has not bailed them out. The Nasdaq 100 is up just 7.5%.
---There have not been big liquid industry groups that have stayed consistently strong.
---Two big industry groups that helped carry the market for the three previous years, energy and real estate, have been sideways to down.
---And importantly, how many managers were willing to be bet that in the face of a slowdown in residential real estate, really high gasoline prices, and rising interest rates that the consumer would hang in there so well. It may well be right to be cautious, but for those who live by calendars being right next year doesn't help much.

The mutual fund industry is being squeezed by indexes and ETF's on one side and by hedge funds on the other. For what they offer in general they deserve to be rationalized. But there will still be great mutual funds that do well most of time, and when they don't the investor has been given the information to know exactly what the fund's mandate is and why they have chosen the fund. As an example there's the Dodge and Cox Stock Fund, up almost 16% with a 52 basis point expense ratio, and with a clear large cap value, low turnover approach.

Last Capitol

Once again we went to see the Confederacy's last capitol in Danville, Virginia. Nice little museum, pushy docent, more so than any other person my daughter had met in Virginia. She insisted that she be able to lead us on a tour, and to be polite we obliged. It was interesting but a little bit long on the accomplishments of certain local residents of the past. She would not acknowledge my low key polite asides about the racist golfer congressman, the biased judge(whose family had donated some of the historic furniture in the museum), nothing, it was just the "correct" history that mattered. Perhaps the Islamist Iranians feel the same way. She was very nice.

There was an interesting exhibit of local artwork that had been entered in a competition. It was well presented and well explained. And there was an exhibit called "Black Gold" that was meant to in some way highlight the local black community, but it featured multiple photos of segregated marching bands of the 50's, a sign for the local soul music station(WILA, or "Willy, the black spot on your dial" as the advertising jingle said in the 60's). It had a few photographs of local black citizens of the past but it made no mention of the civil rights struggles of the '60's and the leaders of all that went on at that time.

Remembering Ed Bradley

It was shocking to hear that Ed Bradley died yesterday. He was just 65. He was on Sixty Minutes a few weeks ago with an interview. The news program reviews of his life and his path to recognition are inspiring. His apparent ability to have independent opinions in a newsworld that increasingly seems to be becoming one of celebrity clones almost invokes nostalgia. My only personal memories are those of seeing Bradley around the racetrack field of Jazzfest, most memorably when he came on the stage and joined in with vocals and dance as Junior Wells, Buddy Guy, and Johnny Winter closed out a set.

Election denouement

The results are in. The Democrats basically ran the table. Certainly that's the case in the House. It seems that they won almost every contested race, and picked up a few like Kentucky's 3rd District and New York's 19th district that weren't even on the table a week ago.
In the Senate, if Webb and Tester retain their slight leads(which seems likely), they have again won every really contested seat. A few observations:

---President Bush's press conference today was his best performance in the last two years. He was seemingly well prepared, mangled few words, and he was serious, with his frat boy smirk gone. He said all the right things while not abandoning his principles. Whether his expressed desire to work together with the new Congress is achievable on either side, it was the right thing to say and he said it with a pragmatic and accepting tone. Can this possibly be what he needed, to be freed from the demands of his own party and to be free of pandering to the so called "Christian" right with no more elections to win.

---Bush's response to a question on an overall immigration bill was perhaps telling. When asked if having a Democratic congress would give him a better opportunity to achieve some type of meaningful bill, he agreed. In fact he spoke of the Republican's stance almost as if he was not one of them.

---The Rumsfeld "resignation" was notable for its immediacy. No waiting to camouflage an announcement as unrelated to the election. While I nominated Cheney for departure in yesterday's post, this was almost as meaningful an action, perhaps more so because the Secretary of Defense actually runs a huge and powerful operation. And Cheney, well, for Bush he is more effective than the Secret Service.

---For anyone who thought they could categorize the financial markets, the rebound of the equity market as the Rumsfeld news was leaked, and the follow through to market gains later in the day shows that many smart people who manage money were ready for some kind of change.

---Of course, today's good words on both sides could be short lived and lead to a government gridlock that plays into two years of unattractive and unproductive politics leading up to the 2008 election. But for now I would rather be hopeful for better times in Washington, and risk being naive.

Election results pending

Election results are a few hours from now, with a "throw the rascals out" theme hopefully soon to unfold. The House in Democratic hands is necessary to purge the '94 Newt landslide. Unfortunately some committee heads will be those with seniority who will not be productive or creative, but the good news is that the newer Dem reps will be for the most part more main stream and open minded. The Senate in Dem hands, a long shot, could also be a good thing, except that it would make Carl Levin, a horrible individual, a committee head(personal experience of his ego and deceit).

Regardless of the election result, if Dick Cheney has any decency and cares at all about what is best for the country he should resign for health reasons. He does have health issues. With a recent 17% approval rating he brings nothing to the table that can create some national or international consensus or reason. In a television interview yesterday, Cheney spoke of the Republican plan for victory in Iraq. At this point does anyone really think that the word "victory" is appropriate. "Achieving the initial goals" is an acceptable stretch goal for a situation that will require a multinational negotiating effort including all affected parties and an Iraqi internal negotiating effort that will require significant external pressure. Success will be difficult. Success seems almost impossible with Cheney. With Cheney out and some new advice, Rumsfeld can be eased out later to sit in an armchair in front of a winter fireplace with Cheney in their neighboring homes on the Maryland eastern shore.

Back to the Met---Americans in Paris

Seeing the exhibit "Americans in Paris, 1860-1900" I was on unfamiliar ground. In terms of the artists represented, it was a learning experience. A quote at the entrance from Mary Alcott caught the essense of Paris then and and today saying "Paris is apt to strike the new-comer as but one vast studio".

The story-line of the exhibit chronicled the two stereotypes of American artists in their precious and, for some, limited time in Paris. The pose could be either that of the bohemian or the flaneur. Flaneur, new to me, meaning well dressed gentleman, observer, stroller of the streets.

I learned that a fixture of the Paris art scene in those years was the annual "Salon", a giant showcase of art work based on judges' selection. In 1863 a rigid jury led to a dispute about which artists work was accepted. Napoleon III intervened and authorized a "Salon des Refuses", an annual exhibition of rejected works. It really is a different culture. What other national leader, then and of course now, would step into an artistic dispute.

As well as in Paris, American artists also joined the Parisian artist's summer migration to Brittany, Normandy, and small northern villages like Giverny. In this area of the exhibit I was taken by a painting, "Reading by the Shore", a woman reading on the coast below a rock formation, by Charles Sprague Pearce that was seemingly at the exact place in Normandy where I took a photo of Kathy in 1983. The Americans were perhaps not always well received in the summer retreats as Claude Monet threatened to leave Giverny in 1892 because Americans kept chasing his two step daughters.

Of the artists represented, most unfamiliar to me, I was most interested in Mary Cassatt and Childe Hassan.

From the notebook of...passing it on

In the last six weeks this blog has included quotes from my Grandmother's notebook. There are many quotes and comments remaining but it's time to pass it on. It was a discovery in my parent's house, but it is a family event, so next week I will pass it on to a cousin in North Carolina. What has been published here on Eyes Not Sold is certainly indicative of the sensibility of the exceptional personality of my Grandmother.

I close with two comments. First, there were and remain quotes from Ogden Nash and others that are, in a sense, cute. My Grandmother was, without question, amused by these quotes(in high school she sent me two paperback books by Bob Hope), but this was not her nature. She was opinionated, informed, active, and she could discuss almost anything in a wryly humorous way, but she was definitely not into cute. She was the first person that I ever knew who read the New Yorker, whether a subscription which would have been an extravagence in the 50's or from the library, it was a mainstay of her front porch reading. Second, there is a page in the "notebook" with the Dylan Thomas poem "Do Not Go Gentle Into That Good Night" that is written in impeccable script with a fountain pen. My mother had told me that this was my Grandmother's favorite poem, and it's there in bold.

And I pass it on.