George Carlin 1937-2008

Carlin meant a lot to me.

He shaped my political philosophy more than anyone else outside of academia, and more than many within. I've always been a passionate civil libertarian, and I owe much of that to George Carlin.

And, people who care about freedom of expression like I do owe him big time. More than an entertainer, he was a reluctant player in the legal battle for freedom of expression--a fight which is still not over.

Everyone knows the 7 dirty words, but few know about the legal firestorm it caused.

F.C.C. v. Pacifica 438 U.S. 726 (1978)

We read this case in Constitutional Law during my first year of law school. It was the first time that I had ever felt truly passionate about something that I had learned in class. It's worth a read, even to the legally disinclined, because it shows how far public attitude toward expression has evolved since the 1960s, and due in no small part to George Carlin himself.

One bit that really hit home with me:

"The FCC, a non-elected body, appointed and answerable only to the President
of the United States, has taken it upon itself to decide that radio and
television in this country are the only aspects of American life not
protected by the first amendment of the Constitution.

You know why they did it? Because they got a letter from a Reverend in
Mississippi.

A Reverend Donald Wildman heard something on the radio
that he didn't like.

Well, Reverend, did you know there are two knobs
on the radio?

One of them turns the radio off and the other one changes the station!


Imagine that, you can actually change the station! It's called freedom
of choice, and it's one of basic ideals this country is founded on.
Look it up in the library, Reverend, if you have any of them left when
you get done burning all the books."


That neatly summed up my attitude toward these moral-crusading crypto-facist nutjobs. Seeing his HBO specials as a kid contributed to my awareness of type of intolerance, and to this day, I dedicate a great deal of time and effort toward fighting the same pin-headed thinking that he spoke of.


At times, however, I also share his conviction that such fighting is a waste of time. In evaluating the grim prospects of reason triumphing over ignorance, I'm reminded of another Carlin thought experiment:

"Think of how stupid the average person is. Then remember, half of us are stupider than that..."

The end of the dividend?

Our Chief Investment Strategist just did an interview in which he talked about one of his key themes in asset allocation--what he terms "dividend sanctity."

This is the idea that equity dividends are crucial, especially in periods like this one, where earnings growth is sluggish.

Free cash flow and balance sheet strength are of paramount importance, because they indicate a companies ability to weather a downturn without cutting their dividend.

Guess what? Weep for the dividend.

Barack Obama has repeatedly said that he will raise the tax on dividends and the capital gains rate. Like him or hate him, raising cap gain rates and div. rates will seriously hurt the market.

It will fundamentally alter asset allocation strategies as yield becomes less important. Investors need to be prepared.

Financials-Have we hit bottom (redux)?

Well, get ready for inflation, people, especially overseas. Tough talk from the Fed and the ECB this week are helping to fuel a dollar rally, but the Fed is not going to be able to raise rates this year without putting the kibosh on growth. Rock/Fed/Hard Place. So, get used to $4.00 gas and $12 corn flakes.

What does that mean for the markets?

It's not a pretty picture. High inflation and slowing relative earnings growth mean that equity markets in the U.S. are gonna suck for a while.

Picks of the week:

MON, BBT, AVX.