F*&% The Rating Agencies

April 29 (Bloomberg) -- Ron Grassi says he thought he had retired five years ago after a 35-year career as a trial lawyer.

Now Grassi, 68, has set up a war room in his Tahoe City, California, home to single-handedly take on Standard & Poor’s, Moody’s Investors Service and Fitch Ratings. He’s sued the three credit rating firms for negligence, fraud and deceit.

Grassi says the companies’ faulty debt analyses have been at the core of the global financial meltdown and the firms should be held accountable. Exhibit One is his own investment. He and his wife, Sally, held $40,000 in Lehman Brothers Holdings Inc. bonds because all three credit raters gave them at least an A rating -- meaning they were a safe investment -- right until Sept. 15, the day Lehman filed for bankruptcy.

“They’re supposed to spot time bombs,” Grassi says. “The bombs exploded before the credit companies acted.”

read more here on Bloomberg

Remembering Clarence White

As many of you know, I play guitar and I write songs and I love bluegrass music. There have been many guitar influences in my life : Duane Eddy, Dick Dale, Doc Watson, James Burton, Eric Clapton, George Harrison, Tony Rice and Robben Ford. But one of the foremost was Clarence White who was killed by a drunk driver at the age of 27. He influenced so many guitar enthusiasts and still continues to do so today despite the fact that there is very little video or instructional material from him. But I just discovered a rare DVD of him as a guest on "Bob Baxter's Guitar Workshop" TV show which was a staple of mine back in the early 70's on LA TV. click here to find it and other material from the producer's website

Video - Yankee Doodle Dandy

George M. Cohen played by James Cagney. The ultimate showman and composer, Cohen was everything an entertainer could be and Cagney won an Academy Award for his portrayal of him in the film.

Video - Thelma and Louise

The ending to the movie, Thelma and Louis is classic.

Video - Unsinkable Molly Brown

One of the great scenes from Debbie Reynolds amazing career.

Video - The Mask

This scene from The Mask really blew me away. It was a seminal moment in the history of film for me. To see a character transformed like this (think Dr. Jekyll and Mr. Hyde) was really new. And, of course, Jim Carry was so fresh and new at the time and funny in the role.

Video - Niagara Falls

Ever see Niagara Falls up close . . . . here's a video I made last year when we visited.

Frugality

Hey, everyone is cutting back and saving. Currently, there are dozens of Web sites and blogs devoted to celebrating conspicuous cutting, like Dollar Stretcher (www.stretcher.com), All Things Frugal (allthingsfrugal.com), Frugal Mom (www.frugalmom.net), and on and on. The Web site meetup.com, which helps people of like interests gather offline, lists 57 “frugal living” groups around the country, including eight formed in February and nine in March.

Los Angeles Homeless Court

Ever since Steve Lopez wrote The Soloist, the homeless mentally ill of Los Angeles have been receiving attention and no helps more than Judge Michael Tynan, he holds a special court for people accused of nonviolent offenses who have both a mental illness and an addiction. Most of the defendants have spent time on Skid Row and some call it home. click here to read more and listen to the interview

Video - Paths of Glory

In 1957, Stanley Kubrick directed Paths of Glory starring Kirk Douglas. It was a hell of a anti war film.

Equity withdrawal data

Quarter 1-2006 there was $223 billion in mortgage equity withdrawals. Quarter 2-2008 it was $9.5 billion! Now where did all that money go? Maybe to maintain an unsustainable lifestyle? Trade real estate? Flip houses?

Another good Blog

I know you really enjoy my blog but check this one out . . . . One Good Move

Sandbags, where do they go to die?

I see where they are adding more sandbags to the "levees" in Fargo, ND. If you've seen the existing mountains of sandbags you can imagine how much larger they are going to be before the Red River crests again but what about this?????? What happens to sandbags after the river falls back within it's banks? Where do sandbags go to die?

It's Masters Time and the Foreigners are here big

Last year, the field was still evenly split at the season’s first major tournament, but this time, the gap is wide, with the 96-player field comprising 41 Americans and 55 golfers from other countries, including the defending champion, Trevor Immelman of South Africa.

Housing costs and inflation

“In 1983, the Bureau of Labor Statistics began to use rental equivalence for homeowner-occupied units instead of direct home-ownership costs. Between 1983 and 1996, the price-to-rental ratio increased from 19.0 to 20.2, little effect on measured inflation: The CPI underestimated inflation by about 0.1 percentage point per year during this period. Between 1999 and 2006, the price-to-rent ratio shot up from 20.8 to 32.3.

With home price increases out of the CPI and the price-to-rent ratio rapidly increasing, an important component of inflation remained outside the index. In 2004 alone, the price-rent ratio increased 12.3%. Inflation for that year was underestimated by 2.9 percentage points (since “owners’ equivalent rent” is about 23% of the CPI). If home-ownership costs were included in the CPI, inflation would have been 6.2% instead of 3.3%.

With nominal interest rates around 6% and inflation around 6%, the real interest rate was near zero, so household borrowing took off. As measured by the Case-Shiller 10 city index, the accumulated inflation in home-ownership costs between January 1999 and June 2006 was 151%, but the CPI measured a mere 23% increase. As the Federal Reserve monitored inflation in the early part of this decade, home-price increases were no longer visible in the CPI, so the lax monetary policy continued. Even after the Fed began to slowly raise the fed-funds rate in May 2004, the average rate remained low and the bubble continued to inflate for two more years.”

WSJ - Steven Gjerstad and Nobel Laurelate Vernon Smith

Remembering Maurice Jarre

One of Hollywood's greatest composers has passed away. Jarre, the French-born composer won Oscars for "Lawrence of Arabia", "Doctor Zhivago" and "A Passage to India". Jarre wrote more than 170 film and television scores including those for "The Longest Day", "The Year of Living Dangerously", "Ghost", "Witness", "Gorillas in the Mist", "Fatal Attraction" and "Dead Poets Society". He was a giant!