Sunday, June 30, 2013

The murky outlook for stocks?

U.S. equities today are generally viewed as close to a safe haven as anything one can invest in.  The alternatives at the moment: bonds, risk reward is terrible, no;  emerging markets, political turmoil widespread and China slowing, no;  precious metals, gold plummets and China commodity demand in check, no;  CD's, bank deposits and money market funds, no return, extremely negative real return, no; private equity, out of reach for those who are not already really really wealthy, no;  the dollar/yen trade, who can choose to live with the volatility of currency investing, not many, no; and on and on we go.

Equities as a safe haven.  Is that a viable concept?  Not for the long term perhaps, but for the short term maybe it's true.  For the longer term, or medium term, there is a problem to consider.  Bonds at current levels do not play their old role as a balancing act to moderate portfolio risk.  The Fed can control short term rates and continue to support the stock market by almost forcing money in to seek some return, but the Fed does not control medium term or longer term bond rates and prices.  Anyone who thinks they do believes in Oz.  The market will make its own decisions and the Fed will only be able to watch.

When these rates go up as odds might suggest they will, they raise the cost of capital for equities.  The hurdle rate for shareholder value accretion rises.  The discount rate for determining the value of future cash flows rises.  In general that will put pressure on the equity market, and make stock picking crucial.

In the near term with conditions in Europe, Latin America, China, and most other investable markets under some pressure, the U.S. equity market should hold up well.  By historical measures and by earnings capacity it is not in the aggregate overpriced, and some would suggest it is a bargain.  The ongoing strength of economic growth is uncertain, however, and that fact reverberates through the equity market.

Now it is still be best place for most investors to have a healthy allocation.  Ultimately though, equity market values are not determined by supply and demand or by alternative choices.  They are determined by valuation.  Diversification is necessary and a cushion for downturns is essential.  Darn it, WHERE?

Equities as a safe haven!? --- we have come a long way from the technology stock crash of 2000 and the multi-faceted market crash of late 2008.  The unexpected is becoming more common in markets just as it is in weather it seems.  We live with uncertainty, maybe more today but uncertainty has always been a constant.

At this point, I guess I'm more or less as conditioned to it as one can be, or certainly more so than in earlier years when there was no capacity here to hold my ground.      

Saturday, June 29, 2013

JCPenney's turnadown

If there was a category for worst incoming CEO of this century, Ron Johnson would without a doubt be the winner.  In his one year or so as CEO, just a looking at the financial results is humorously appalling.  It is almost impossible to match his level of underachievement.  In one year current assets began $2.2 billion higher than current liabilities and with the end of his tenure were just $300 million higher, on the edge of complete instability.  Stockholder's equity had declined from $3.9 billion to $2.8 billion, and sales had dropped from $18.5 billion to under $13 billion.  It's an achievement that's almost impossible to comprehend.

Johnson was recruited from Apple's marketing division with a huge up front bonus plus the usual great salary and incentives.  Sometimes people who work for phenomenal hands on CEO's turn out to be useless placekeepers, and that's obviously what Johnson was.  His plans for a major reshaping of JCP were naive and arrogant.  Long term they may have had, I think did have, some potential but results need to come before adulation seeking strategic hopes.

JCP was a middling company with a loyal but aging customer base and a lack growth prospects when Johnson took over.  It did, however, have those customers and it did have a viable if unexciting balance sheet.  Johnson overwhelmed the company with ideas for change, stores within stores, and the spending requirements to implement such a strategy.  He eliminated long term company brands, inherently more profitable items for any store and often less expensive for the consumer, and at the same time pissed off some long term branded product producers by looking for concessions to allow them to join the store within store concept.  Politely his actions could be called "too much too soon", more bluntly they could just be called stupid.

On top of that, he was such a star that he would only work a four day week at headquarters in Texas, keeping his home in California.  He hired others from Apple that he had worked with and they had the same deal, four days a week and home to New York for one as an example.  In the midst of such of dramatic turnaround, determined and committed CEO's who succeed often spend seven days a week in their headquarters until things are settled down.  The resentment that he created among long term employees, many key employees, was huge.

All of that is history but worth repeating I think because the question is really, as an investor, what to do now.  One positive is that I can find only sell or underperform ratings on the stock from sell side analysts  That can't get worse.  Yet JCP did receive a $2.25 billion addition to its term loan with no change in terms in late April.  I say no change in terms but they basically had to pledge the majority of the real estate to secure the new credit.

So however fragile, there is still the possibility of value there, I think it's what one could call "deep, very deep, value".  The new CEO is the former one, Myron Ullman, who kept the company afloat in a viable way but let it languish.  At a minimum now, he has some loyalty remaining among employees.  He is no innovator of consequence, but he seems committed to settling things down.  People may be seriously ready to work hard for him after their experience with the aloof Johnson.  They do want their continuity of employment, retirement plans, and lives to stay intact, and Johnson was busy destroying that possibility.

Here I am foolish enough to have bought some stock at around $19 and some more at $17, with an average cost basis of $18 and the stock now trading in $17.  Will I sell it all at $15 and take my medicine, YES.  Do I think that there is potentially some real upside, YES.  School year beginning time and Christmas will make or break this company.  Any improvement of even mild consequence will help the stock.  JCP will be competing on price aggressively which could bring shoppers back in but likely be no real benefit to profitability near term.

We'll see.  It's an interesting story.  A few new motivated hires to aid Ullman and few new interested shareholders with clout could change this story significantly over time.  If that doesn't happen, this investor will be gone with a loss, not too big but never fun.

Postscript:   during the second quarter George Soros bought a 7% position in the stock, and in 2010 the activist Bill Ackman built a 17% share that he has stayed with, believing in the eventual upside potential.  These are investors who take risks, but their track record overall is one of making money, Soros seemingly more consistently than Ackman..  

The demise of print newspapers???, an exaggeration perhaps

Much has been written about the continued decline in print newspapers, the number of them and their profitability.  The pressure from internet media is undeniable.  The financial pressure on "cover the world" major newspapers is real, as their informed and younger readers are more likely to use their IPad type devices or smart phones to get information.

That's all true, but there seems to be more to the story.  Today we received our first copy of the Manhasset Times, a new competitor to the long standing Manhasset Press.  These are suburban newspapers that have a template of advertising and county news that are applied similarly for many towns, but they are tailored to each individual little town, one hardly distinguishable by borders from the next town.  Now two Manhasset newspapers are filled with local news about people, the schools, library events, real estate activity, editorials and letters to the editor, local government decisions, any crime, high school sports, obituaries, and other varied items of interest.

Manhasset itself has 8000 people and, to stretch the use of this concept, a metro area of probably half that many more that identify Manhasset as their town and are permitted access to its schools and facilities in some way.  The new "Times", just read today for the first time, had far superior content today than the usual "Press" but that and an offer of a free two year subscription may be just part of its coming out party.  That remains to be seen.

The fact is that just about everyone in town takes a gander at the "Press", if just to see local photos and know who has done something notable.  This very local newspaper print media is alive and well, and with all of the real estate advertisements and food market inserts must have some aspect of profitability.  If not, why a new competitor?

This post was occasioned by this little local example but there is a bigger issue.  Warren Buffett likes the concept of holding and reading local newspapers and already owns a stable of mid-sized city newspapers(not small towns like Manhasset) he continues to express interest in buying more.  To him they are as American as Dairy Queen, which he also owns.

Despite the Sam Zell debacle of buying major Chicago and Los Angeles newspapers and running them like real estate properties, there still remains big money buyer interest in these products.  Some are for thoughtful investment reasons and some are deemed to be for control of editorial content.  As to the latter, Rupert Murdoch's ownership of the Wall Street Journal has not noticeably changed its editorial stance over the last five years and has dramatically improved its news coverage, such that on many issues, some international ones beyond business, it is hands down superior to the New York Times.

The worrisome issue at the moment is the Koch brothers interest in major newspapers as their political clout is beyond worrisome with their radically conservative and anti-libertarian views, and massive contributions to disruptive political organizations, some of which represent the worst side of those who identify themselves with the tea party.  A strange aspect of their behavior is their huge amount of constructive philanthropy, especially here in New York, even supporting public radio here to some extent.  Are they to be feared as much as one would expect, especially given the Murdoch example at the WSJ.

The point of this post is that the wonderful feeling of holding, folding, scanning through, and even reading a big messy newspaper is not going away anytime soon.  Eventually it will, one could guess, but eventually can be a very long time.  I certainly hope so.

Postscript:   Print newspapers are not blind to the internet and are finding ways to least use that outlet, although one wonders how profitably.  That will shake out over time.  The major story of the famed New Orleans Time Picayune going to from a regular schedule to three days of regular print editions plus Sunday, supplemented by internet access, is an anomaly so far, largely due to the fact the metro population was essentially cut in half by Katrina.

Many newspapers must be at least monetizing their internet delivery to some extent.  My hometown Danville, Virginia newspaper provided internet access for free though 2011, and then went to allowing five page views per month free, and that was it, unless you subscribed.  Heck I delivered the thing for seven years and am amused by keeping in touch with the town so for $85 a year I can see it in full, anytime.  It's good to know if any sympathy cards are needed to be sent and the related gifts to the chosen charity of those that were close to me or my parents.  


Friday, June 28, 2013

The asymmetric arrival of a plethora of household tasks

Over the past year or two things have been going swimmingly(a word not used here until now or in my normal speech patterns, it just showed up) as far as home upkeep, repairs, or maintenance.  That has changed recently in a major way.

A major reason was the infamous hurricane Sandy.  Other than being miserable for two weeks and losing two trees we came out well relative to many folks, but the price is being paid now.  We decided, K insisted, that we get a full house generator.  This is not an inexpensive proposition but it will be worth every penny if our power company fails for extended periods whenever a major storm hits.

Before Sandy, one simply bought a generator and the supplier was essentially the general contractor for getting everything set.  Post Sandy, NOW, the suppliers as so busy that they do not have the capacity to both supply and completely install the equipment, so the buyer in turn becomes the general contractor.  That means coordinating the gas company installation, a plumber with experience, an electrician who understands these machines, a trench digger for the gas lines of to the generator and to the heating boiler for the house, an installer who converts the heating system from oil to gas, a specialist to remove the oil and oil tank from the basement, the actual provider of the generator, and all of the various governmental approvals and inspections.

A few of these people we already know and trust, a few we already know and use because the options are limited, and a few are new to our universe of service providers.  Generally speaking the main participants are all large men in their 50's who seem to eat well and have diabetes or knee injuries.  Most are congenial, but it's hard to tell who is really charging honestly and who is not, who is really talented who just gets by.  Managing this is somewhere between a nuisance and a nightmare.

All of this generator work was pretty much expected, the extent of the management of the project underestimated.  More unrelated house repair events also have surfaced.  Why does that always seem to happen, that an almost simultaneous series of repairs are needed in many places after a  reprieve of a few years.  Do inanimate objects have a secret way of communicating to cause maximum harassment to their owners?

For one the sprinkler system had a valve break two weeks ago that maybe, just perhaps, has now been repaired.  Our sprinkler system guy is a young man who is the son of our landscaper, our landscaper who does everything from make our fairly large yard look great, cleans our gutters, fixes broken faucets, fills in sinkholes that occasionally appear for various reasons.  He is exceptional and does all of this without any guidance from us.  He sees a need and takes care of it.  The yearly charge if added up is not so small but it seems more than fair given the responsibility that he and his crew take.

His son is a different matter.  His father set him up in this side of the business that he previously ran, probably to give him some responsibility and a reason to buy state of the art pickup trucks.  On the promptness scale he is marginal, on the skill side he is questionable, and on the intelligence side he does not seem too bright.  He is very pleasant.  There was an article somewhere recently that somehow used markers to estimate the IQ's of many famous people, with as one knows, 100 being average, or functional but not so creative.  I don't remember many of the estimates, but most really successful people were in the 140's, George Bush 2 was 125, Einstein was in the 160's, Madonna and Reggie Jackson were in the 140's and the low one that I remember was Andy Warhol at 86.  So we have the Andy Warhol of sprinkler maintenance and repair professionals.

Other events --- three major florescent lights in our basement went out within a one week period, those long fixtures with some sensitive connections.  Due to new environmental regulations they now cost a fortune and provide less light with greater longevity  ---  two sinks, one tub, and worst of all one toilet upstairs have developed slow drainage over the last few weeks that Drano or a plunger cannot deal with.  That job has yet to be farmed out, but we know the guy.  Fingers crossed that these are just blockages and have nothing to do with our cesspool, a distinct little charm of Long Island living.  So far my check of the cesspool linkage in the basement has caused only minor concern.

A couple of other minor events were short annoyances that with persistence and luck I actually managed to solve.  My smart phone refused to charge for two days.  I plugged it in for 24 hours and finally it took hold.  Fine for now but that does not bode well for its longevity, but I am overdue for a change anyway.  The other minor event was that the upstairs air conditioning thermostat stopped functioning properly.  With a call to our service provider and some on phone instruction that I actually understood, it was repaired after one humid night upstairs.

Then of course came another big one.  My desktop computer more or less imploded.  It had been a faithful companion for eight years but had outlived its service life, became so slow and unreliable that it needed to be put to rest.  Rather than buying an entirely new system, our local computer service provider and I decided to simply replace the computer box and stick with the same system.  This was not seamless and for a few days I was in a daze - no morning access to computer news sites, no e-mails coming in, no ability to send e-mails, and complete confusion about how to do basic functions.  As of last night this seems to have been mostly corrected and my sanity has improved.  As the old blues song says, "you don't miss your water 'til your well runs dry".  I missed it terribly for a few days.  Revelation! - I must broaden my computer investment and skills to include an IPad or some such device for back-up and more mobile availability.  A smart phone does not do it for me.  I am all thumbs in the worst way and my vision does not adapt well to the small screens.  For me, it is primarily just a mobile telephone.  

There are still some issues that are a little annoying and time consuming related to the new computer.  All of the e-mail addresses that were automatically built into the system did not seem to transfer.  Maybe they are still transferring as some things are doing just that three days after installing the new system or maybe it will take some time to rebuild the database.  Who knows what other glitches based on the change or my lack of computer structuring skills will show up.  For now though, the ability to write and send an e-mail or write a blog led to this splurge of personal detail, maybe too long, maybe not so interesting, but it will be so nice to see it published and feel connected again.        

Monday, June 24, 2013

Krugman trapped in box of own making

Paul Krugman's columns in the NYT are becoming increasingly defensive and untenable.  While on some alternate days he make some good political points, his economic commentary is going off the tracks, seriously.  Today's column was among the worst.
"critics who argue that its(the Feds) easy money policies are having damaging side effects,  say increasing the risk of bubbles.  But I hope that's not the case..."  Thanks for the hope Paul.

This column must be read to be believed.  He blames all unemployment issues on policy mistakes, and somehow has no knowledge of the major structural issues that have occurred in our economy, led by technological changes that lead to the need for far fewer workers. 

There is a lot to be done that could help with the unemployment dilemma, and none of it is being done by our current inept Congress.  No viable answers will be found in Krugman's rigid and inflexible opinions.  His unbudging approach makes him seem like the Arthur Laffer of the left.

Sunday, June 23, 2013

Last week's equity market's decline and bond market gyrations

Much has been written about this past week's securities market's activity, and I did not read much of it.  Here are some opinions, hopefully not all a rehash of what has already been said by others.

Within a reasonable range, an equity correction can be good news.  The market can't just slowly slide upward forever without setting the stage for a bust of some magnitude.  None of us like to see our stocks or mutual funds go down at any time, but a little jolt of reality is not a bad thing.  Stocks can and do go down at times.  If this is a standard correction, it is a longer term positive for the market.  If it is an inflection point leading to a sustained decline it is not.  One never knows, but U.S. equities today are by no means significantly, if at all, overvalued as measured by earnings or by historic norms.  The media likes to create a degree of panic to keep us tuned in just as a normal thunder storm is foreseen as a precursor of gloom on weather stations.  Keep them panicked and they'll stay tuned in.

As to the reason for the market agitation, Bernanke basically said nothing more than that he would not keep printing money and buying up securities at current levels until hell freezes over if there is sustained modest improvement in the economy and no more disturbing unemployment news raises its ugly head.  That makes sense, is an obvious comment, but human short term traders, other  mostly legal market manipulators in the SAC mold, and high speed algorithmic technologies do not think.  Much of the rest of the market feels that they need to follow that group's lead to protect their comparative values. 

There are some investors who hold their ground based on their research and long term approach to investing.  They cannot be discerned in weeks like the one just experienced.  As much as I admire him, and I genuinely do, I sometimes think that we eat at Warren's buffet a little too often.  Nevertheless,  I'll take another helping.

As to the bond market, this activity creates trading and arbitrage opportunities for those in the know.  In general, for the rest of us the uncertainty just creates downward pressure.  That said, some level of higher interest rates is inevitably necessary for a healthy balance in the economy.  Unless we want to be like the Japan of the last 20 years, how long can we let savers and the elderly continue to bail out Wall Street and the banks.

There is certainly, inevitably, change in the air over the next year.  It could be highly positive for astute equity and bond investors, and a tremulous time for those who have just been blithely riding along on the Bernanke meal ticket.  Hey, this is not an arrogant comment.  I do my best to actively manage what we have but as a retail investor can only do so much.

Sunday, June 09, 2013

"A Millon Dollar Illusion"

The Sunday 6/9 NYTimes section has an article that could make anyone in the so-called upper middle class, and whatever is middle class these days lose sleep.   For sure, in the 1960's  some "Millionare" television program engrained in our minds the idea of one  mllion dollars as rich.   It is not when you are actually in your 60's.  It's nothing to sneeze at but it is not rich.

We are fine I hope, but have some amount of worry about the money that we have saved for our children and their understanding of it.  It's a work in progress.  I think that the younger one will no longer take part of her saved money and buy a Lamborgini.  Those doors going up are so cool, and in Italy some years ago she decided that it was the car.  I would want one too.  The older one really understands savings, but is only now beginning to learn about investing.

For us, we are more careful than we once were, and we were never frivolous unless one could question our vacations and quality of cars.  Now we are almost frugal as we hear ideas floated about "one-time" percentage taxes on total assets plus means-testing Medicare and Social Security, assumed guarantees in any financial plan.  Despite the positive intentions of Obamacare, it will absolutely drive up costs for the upper middle class.

The future is unpredictable.  If only there were a strong moderate, fiscally conservative, socially open minded party to debate the Democrats, but we are stuck with the Republican Party of 2013, which in no way resemble the Republican Party of 50 years ago.

Saturday, June 08, 2013

Niall Ferguson's WSJ of Saturday/Sunday 8-9 edition of section C1 "How America Lost Its Way".

This is worth reading and for the most part endorsed.  The general message is that, especially for entrepreneurs, it is getting ever harder to do business in the United States relative to many other countries.  In a survey by the World Bank, it reports that in only 20 countries have regulatory hurdles that have risen, and the U.S. is the sixth worst.  Other members in the bottom 10 are Yemen, Burundi, and Zimbabwe.

Using seven measures of regulations that must be satisfied, it suggests that the total number of days it takes in the U.S. for a small business to get approval has increased by 18% to 433.  Seven years of data suggest that most of the world's countries are successfully making it easier to start and run a business. 

The above is just a teaser for the content of this article which is still up and available on Google.

Friday, June 07, 2013

Today's "Win, Win", jobs numbers

With 175,000 jobs added, more that expected but still below what is needed, and an unemployment rate of of 7.6%, up from 7.5% last month, the equity market is reacting positively this morning.  The reason, more jobs added than expected even if below what is eventually needed but still continuing weakness in employment, a prime Fed focus.  The sum of this is that economic growth is marginally improving and the Fed "quantitative easing" or printing money will likely be sustained near term.  These two ingredients support the stock market, at least near term.

Wednesday, June 05, 2013

Stocks retreat, but what's the real story?

The S&P index(SPY) has now been down 5% in the last 10 days.  There is still not an insignificant short postion in the SPY.  There may be more downside, but one hope is that we now are going to have a real investing opportunity.  Whoo be do.

The SPY has around a 2% yield, before today and its price has been up 27% over the last 52 weeks.  One could suggest that it needs a rest.  Markets that go straight up for an extended period tend to go straight down in a crisis.  Right now one could see this as a healthy correction.  One, of course, never knows but long term historic analysis suggests that equities will go through fits and starts, but outperform other investment choices in securities over time.  Look no further back than March 2009 and the significant rebound since that time for those who held their ground and for some who made a few opportune investments that led to a windfall over the last four years(I do wish that I had made more of those "opportune" investments at that time but I was losing sleep just hanging on to what we had and was not aggressive enough about all of the opportunities that existed at that time. Who was?). Now there may be some settling down, some pull back.  It may provide an entry point soon for money on the sidelines.

With all of the essentially cash equivalents waiting to be invested, the recent SEC suggestions about rules for money market funds may light a fire under investors' need to at least take more equity risk, especially in international branded large caps and in small caps with little research coverage but with sound balance sheets and product competitive advantage.  To my dismay I missed much of the surge in biotech small caps this year.  I don't understand the stocks and to me it's not at all predictable and an FDA craps game.  When the game is won the rewards are high and for those in the know, not me, 2012 was a good year.

While I stay fairly well, or overly, invested in equities, other accounts managed here had a good year in 2012 due to a real estate sale.  Most of the money has either gone to the taxman or stayed in cash equivalents.  How do you find opportunities in a constantly rising market.  I'm not Warren Buffett.  We don't have unlimited capital and the ability to buy whole companies.  We are just retail, looking for an entry point that has some upside over time, and for younger ones hopefully a long period of time.

I know that trying to time the market is a "fools errand" for small timers, but it can be done to some extent with effort, alertness, and luck, and as a friend contstantly reminds me, low expense ratio index funds like Vanguard.  Now may be the opportunity to put some over the top cash postions to work in modest increments over time. 

Postscript  ... there is this ongoing seemingly useless debate on media outlets over who rules the markets, who are the smartest, the bond guys, the equity guys, or I add a couple or others, the FX guys or the commodities guys(guys includes gals as well).  I hope to conjure up some thoughts about this in the next few days.  First thought, they are all in it together and depending on the market at any given time, some have ascendency.  There are other thoughts here as well, what they are may come to me in my erratic sleep some night soon.

Tuesday, June 04, 2013

Bloomberg's transparent attack on JPM's reputation

Yesterday on Bloomberg's widely viewed website the lead story was "Whale of a Trade Revealed at U.S. Bank with Best Control".  I looked at that headline and immediately thought, "oh no", not another one.

The story remains among the top highlighted ones today on the website.

The article in fact is a detailed rehash of last years $6.2 billion trading loss by a group of essentially rogue traders in London.  Absolutely nothing in the article is new information, with the most recent information being from June 2012.  That's one year ago, but the headline reads as if this is current news.  Printed out the article is over 10 pages long.  This is almost unprecedented vindictive behavior by Bloomberg.

Could it have something to do with JPMorgan and Goldman Sachs uncovering and publicizing the fact just this month that Bloomberg routinely allowed their reporters to monitor some private information it gets through its widely used data terminals that it sells to investors, hedge funds, and even the Fed and many Central Banks.  This news was reported widely earlier this week and Bloomberg's editor publicly apologized for this long standing practice of violating client privacy.  That's the client privacy of 315,000 subscribers that the reporters could pick and choose from.

Is there a legal issue here. One could assume that buyers of Bloomberg's terminal services have contracts with some mention of protection of their information and any misuse of it by Bloomberg itself.  Is this strangely dated article on JPM a warning to them and by extension to Goldman(the proverbial "shot across the bow") that if this becomes a legal issue Bloomberg will use their reporting and editorial clout to encourage legal action against other firms related to trading or securities issues at their firms.  Seems like it could be.

Or is it simply the hubris of Bloomberg showing itself as in "how dare JPMorgan and Goldman's public relations departments compare notes and see a pattern of information flows that were not public being used by the vaunted Bloomberg's reporting team".  Watch out Goldman, you may be next for a misleading headline. 

Monday, June 03, 2013

44 years later, Bloody Monday gets historic marker - Danville

"44 years later, Bloody Monday gets historic marker" - "": Danville.  This article did not transfer itself with a link, so to see it one must go to the site mentioned above and detailed in a later paragraph.  The historic marker, pictured in the article, was established in 2007, but June 10th, next week, will be the 50th anniversary of this ever inexcusably ugly event in my hometown.

The 50th anniversary of this event is receiving national attention.  Page 5 of the NYT's Sunday review section has a 2/3rds page article on the events of that day and the Danville newspaper listed above had a longer one.  This article suggested above is a follow-up to Sunday's article.

The New York Times had some interesting facts that I was unaware of, particularly the story of a socially prominent white member of the community(Rotary, Danville Golf Club) who was fined and put in jail for criticizing  the harshness Judge Aiken's sentencing of the protesters as "inane" as a "sign of petulance"
 in a letter.  The information seems to have been related to the writer by her father and grandfather who grew up in Danville and it is unclear whether she ever did.  So that's probably the reason that the article has one clear factual omission.

It states that the "police chief authorized an all white force of garbagemen to use billy clubs on the protestors", protestors who had been firehosed forcefully through a tunnel under the old courthouse and came out the other side to be savagely beaten.  The omission is that police officers supervised and took part in the beatings as well, and even the outrageous fact that several city council members, elected officials, were there with billy clubs as well.

The local press associated with the AP did not report any of this unrest for 38 days, but word spread to other newspapers in Greensboro, N.C  and elsewhere, and eventually was picked up by AP and the NYT.  Martin Luther King came to Danville several times over the coming months, calling Danville, Virginia and Selma, Alabama the two worst cities in the United States.

My knowledge of this is not just tangential.  My somewhat shy always polite mother happened to be President of the YWCA in 1963, the only biracial organization of any size in the city.   She knew some of the victims of the beatings and had direct information from them.  She contacted our congressman but that was of course useless. 

As for my family, there was no question as to our thoughts about all of this ugly racist, beyond racist, behavior.  My direct experience was being downtown across from the courthouse a few days before June 10th or maybe the morning of that day, I have no idea at this point,(had ridden my bike down to pay my collected bills for my paper routes at the newspaper headquarters across the street).  On the courthouse steps were 50 or so mainly, or almost solely, young people holding a few homemade signs but otherwise just sitting quietly and at times in barely audible tones singing protest songs.  Then a group of police came from out of nowhere and attacked the group, which led to mayhem, me barely missing getting run over by fleeing protestors and a policeman on the chase.  These protestors were no doubt part of those arrested for which the prayer vigil was being held that day or a few evenings later outside of the courthouse, the prayer vigil that was attacked viciously and led to the name "Bloody Monday".

Again,I could not make the article mentioned in the title link, so to see it and Sunday's article the only option from this post to going to   Maybe this event is part of Danville's karma that led to the loss of its major textile mill completely and almost all if not all of its tobacco market and associated processing, and with no viable economic replacements.  While now a much much better place in some ways than it was in 1963, it is in an extended period of decline in prosperity,  if prosperity is a word that could really apply to much of Danville now, which I actually hope can be reversed over time.  It's not impossible.  There are still many good people there who are not afraid of work,  a mostly reliable infrastructure and fastidiously maintained major roads and parks .  As could be expected there is also clearly a racist divide to some extent, but nothing like the past.  It's as much economic as it is racist now, but vestiges of the past still remain.  Find me a city in the self-righteous Northeast that does not have some of the same issues.        

Saturday, June 01, 2013

"Evermay" has a passing

Evermay was the name given to a large house which 15 Georgetown friends rented for their 1970-1971 senior year of college. At times it was more than 15.  It was a former American University fraternity house that had folded and was curiously closer to the Georgetown campus than to A.U., walkable to Georgetown but not exactly a short walk.  It was a block away from the National Cathedral.  One of the 15, McD, died unexpectedly just over a week ago, and this is to a remembrance of Evermay and him.

(In this post there will only be initials used to indicate people as, while this is meant to be true, it is selective memory that I would not want to offend anyone, so think of it as historical fiction.  I fully expect those involved who happen to read this will have no trouble identifying anyone, but I think caution is the right choice in this case.  Search sites generally don't pick up on initials.)

According to what I have been told, McD had some seemingly controllable medical issues but was leading what was a regular life for him, then suddenly had a stroke that escalated into a series of strokes, and then the doctors discovered that he already had metastasized pancreatic cancer.  He lasted only a few more days, with his girlfriend of 30 years by his side, a sad and unexpected event.

While I had not seen or spoken to McD in 25 years, we parted ways in New York in the 1980's, McD's best Evermay friend AH asked me to help track down those to notify about his death.  We had all split up in different directions and maintained different contacts.  I did what I could do, and SL was also a huge help once I contacted him because he had kept in touch with more than me.  It was sort of a chain notification, the extent of which is not known.

On the same dorm floor in freshman and sophomore years, McD and I could not have been more different in some ways, but we were at times good friends on adventures of various sorts, often with AH or SW involved.  (As a no sibling loner I had my own adventures too, another story, and  with the low key brilliant JM tracking down blues bands whenever they came to town or seeing Jimi Hendrix, Jefferson Airplane and other West Coast groups in their first visit to D.C).  AH and McD had an apartment in a small house in Arlington, VA during our junior year, off Lee highway, and I lived with others in a larger apartment building a mile or two away by road, but a short walk through a wooded area to their place.  I spent many evenings there with with them and others they attracted, talking, listening to music, and doing whatever else people our age and inclinations did in those days.  There were many good evenings.

McD was a predictably unpredictable character.  He certainly was smart and had an intellectual aspect to him.  Mischief could have been his middle name, and occasionally mayhem or a few times malice.  We had not stayed in touch by design, but I always had an interest in what he might be up to at any given time and at times, if I asked, AH would give me an update.  One almost always thinks that there will be some reuniting with former friends, but that does not necessarily happen.  I will miss knowing that he is not out there somewhere, and would rather have talked to him at some time than write about him.

This leads to two anecdotes that to me at this moment characterize my best memories of McD, Evermay, and those times, at least in my way of thinking.  The first was in February of 1971 on a Thursday night before Mardi Gras weekend and the big day itself in New Orleans.  I had been to New Orleans a couple of times on short trips related to a summer job, teaching tennis, that I had for several summers, and in the summer of 1970 had spent about two weeks in New Orleans on a questionably advisable tour of the South with a south Virginia hometown friend, questionable I only say because we were sort of long haired and uncoventional looking for driving through Alabama, Mississippi, and other states in between.  It was a great trip and New Orleans was far and away the highlight.  So in the living room of Evermay Thursday night I was rattling on about how great it would be to go to Mardi Gras. 

Someone said "let's go"(despite being in the middle of mid-terms), so at midnight five us took off in SL's Volkswagen Beetle, crammed in.  SL, PD, and RP were broad shouldered guys and KS and I were the skinny ones that somehow were squeezed in.  Others in the broader group were interested as well as we left so I suggested that if others came to meet us at Burgundy and Toulouse in the French Quarter in the mid afternoon of the next day, an ambitious goal.  We drove non-stop and when we arrived, McD in his blue Dodge of some sort with a big motor and MB in his even more high powered Dodge Charger, were already there, cars packed and waiting for us.  A couple of the group were our close friends but not Evermay inhabitants and in all there were maybe 13 of us ready to experience Mardi Gras, and we definitely did so.  There was a bar at the corner and we went in and it was filled with nuns, but they were not nuns, an appropriate introduction to New Orleans.  We had no hotel reservations so we slept in the cars, bummed floor space at Tulane University, found accomodating folks our age to let us in their cheap hotel rooms, or just never went to bed at night and caught some shuteye in a sunny New Orleans park during the daytime. 

Now that's the set up for this M story.  The second night there McD, SW, MK, and I had driven to the Faubourg Marigny section to take a look.  At that time only the part of Frenchman Street closest to Esplanade could have been called safe(now much of that area is the absolute center of all great music in New Orleans and the French Quarter is passe' for music, just the eating and drinking tourist mecca at night).  Anyway we got out of the car and were adventuring around when a big white van of partiers, all young black New Orleans folks, asked us to jump in and they would show us around.  Of course we did and they did take us around in this partying van with us and at least 8 or 9 other people mixing together for four or five hours, stopping at a few really run down places to hear great music and have a few libations, and spring for a few for our hosts.  I remember passing one particularly lively looking place and suggesting that we stop there.  The response, "if you go in there you will get shot".  We all agreed to pass on that idea.

At about 3am we were finally dropped off at McD's car, said our goodbyes with pats on the back and hugs.  In the interim MK had somehow disappeared.  McD started the car, pulled up to an intersection with Esplanade( which has a road divider with very high curbs).  He took a left turn onto Esplanade at the highest speed possible, ran into and up onto the road divider, blowing two tires and leaving the car askew.  Then he immediately passed out.  Calling the police for help was out of the question because New Orleans police just beat people up and maybe bothered to take them to jail.  They were and apparently still remain dangerous, criminals with badges.  SW and I barely had the combined mechanical ability to change a lightbulb but somehow we managed to remove the damaged wheels since the car was already in a position where they were off the ground.  For some reason we were laughing like crazy people as we rolled the tires down Ramparts Street towards Canal looking for some service station that was open.  Luckily there is always something open in New Orleans.  After four or five blocks of rolling the tires we found a place. 

They repaired the tires and must have driven us back up to the car and put them on for us.  I have no memory of that and SW has been in hiding or disguise and using assumed names for 15 years so there is no one to fact check with on this.  Anyway, the minute the tires were on and the car had been righted and put back on Esplanade Street, McD immediately woke up, and as if nothing had happened, he started the car and we sped off looking for a place to take a rest. 

This anecdote may have been too long, but the point on McD is that he just always seemed to just move on, regardless of what happened.  Talk about not looking back to any of his or other's actions or surrounding events, even to an immediate event, that was just the way he was, puzzling at times and not appreciated by some, but it was sort of fascinating to this small town Southerner.  His approach to life led to both very amusing and uncomfortable moments.

The second anecdote will be shorter.  That same year, in 1971, there was a complete "total" eclipse of the sun that would be visible on Assateague Island off the coast of Maryland and Virginia and maybe an hour and a half away from D.C. I have seen other supposed total eclipses of the sun described since that time and seen one in London in 1999, but unless one is in an exact spot where it is actually TOTAL, they just lead to a darkening dusk like sky, a little wind, and a cooling off.  That is no, absolutely no, comparision to "TOTAL".  M, SW, PD, and I drove to the island promptly, crossed a crowded narrow bridge and began the wait during which time McD set up what to me was an elaborately timed camera on a tripod. 

Then the event happened.  The skies began to darken, and when the darkness was complete this amazing band of bright, extremely bright, colors appeared on the horizon over the ocean.  It was the most amazing natural event that I have ever seen.  McD's photos didn't capture them because  he had focused on the sun which you are definitely not supposed to look toward during a total eclipse.  None of us had the slightest idea what would happen on the horizon.  We drove back in uncharacteristic silence, listening to a classical music station, Mozart I remember mostly because we had not heard the introduction of the music so SW and I challenged each other to identify the composer.  In classic New Yorker fashion he laughingly ridiculed my choice, and when I was right he almost lost his breath.

I am not a religious person in any formal or even informal sense, and I have no idea what is on each of our horizons, but I do have some spiritual sense of both the known for sure and the unknown for some reason, maybe Pascal's wager or maybe something deeper.  I hope that the eclipse described is part of what McD is experiencing now.

Postscript 1---McD was the person who found the building that became Evermay in the summer of 1970 and basically told us that we were all living there.  The name came from a tombstone in Dumbarton Oaks cemetery found by either McD or A or both.  After finding, filling it up with occupants, and naming the building, McD essentially appointed me as treasurer, so my job was to collect everyone's rent each month and send it in, a responsibility that I actually liked despite a few nuisances. Occasionally that also led to being the point person to deal with the landlord who at times had a few complaints, all justified I think.

Postscript 2--- in making calls to the handful of people that I knew to inform about McD's death, a couple said "he's the first one of us to fall" or something like that.  That unfortunately is not correct.  A good and loyal friend RP died maybe nine years ago of leukemia.  Few people knew because he kept up with no one after college.  My completely uninformed guess is that when he got married and had children he went through one of those "people, places, and things" conversions to stay on the straight and narrow.  When I moved to New York in 1980 I tracked him down by phone somehow at a lower Manhattan bond house that he worked at, but he never followed up and I just respected that.   Still miss him and the remembrances of the adventures that KS and I had with him during an extended trip to Europe in the fall of 1971.  There are some real stories from that trip.

In memory of both the recently departed McD and the relatively long departed RP, I close this narrative.