John Yoo, D-Bag

For anyone out there who still supports or likes John Yoo, please, please, for the love of God and Constitution, read THIS short Atlantic article. One excerpt:

Based on the results of our investigation, we concluded that former Deputy AAG John Yoo committed intentional professional misconduct when he violated his duty to exercise independent legal judgment and render thorough, objective, and candid legal advice. [Italics added]

And you're welcome, even if I can't expect a "thank you."

EIA on Natural Gas

Natural gas seems to be hitting new lows these days. Yet, the government expects the price of natural gas to increase in 2010: 

EIA expects this year's annual average natural gas Henry Hub spot price to be $5.37 per million Btu (MMBtu), a $1.42-per-MMBtu increase over the 2009 average of $3.95. EIA projects continuing price increases in 2011, averaging $5.86 per MMBtu for the year. EIA expects working gas inventories to end the first quarter at about 1,644 billion cubic feet (Bcf) compared with 1,734 Bcf in the previous Outlook, because of colder-than-normal weather in early January. [Citation here.] 

UNG and GAZ allow traders to play natural gas prices. There are several negative potential tax issues with buying GAZ or UNG, so I trade these in a retirement account to be on the safe side. 

Also, it's true that natural gas ETFs/ETNs may not necessarily track the actual price of natural gas, but they do seem to follow the general movement of prices. If the government is saying prices are heading up, why not consider natural gas as an investment, albeit an admittedly speculative one? 

I don't know if I will hold my GAZ shares one day or one year, but I don't feel as if I am buying an overvalued commodity. As more consolidation occurs in the natural gas sector (XTO Energy, etc.), at some point, prices are likely to increase. While consolidation may not be good news for consumers, speculators may benefit from short-term volatility. 

Disclosure: I own GAZ and have owned UNG in my Roth IRA. 

Note: GAZ closed at 12.03 on February 25, 2010, the date of this posting. 

Update on March 1, 2010: MF Global’s Mike Fitzpatrick's says, "Technically, the charts are bearish." According to THIS article, he "expects $4 natural gas to be tested very soon." As of today, natural gas traded at around 4.680, so Mr. Fitzpatrick expects a 17% drop. 

Update on March 8, 2010: I averaged down by buying some GAZ at around 11.23. I am now losing around 5% on this position. The actual price of gas is $4.517/MMBtu. I hope I have the mental fortitude not to check this position until October 2010, when natural gas prices may rise much higher. 

Under no circumstances do any statements here represent a recommendation to buy or sell securities or make any kind of an investment. You are responsible for your own due diligence. To summarize, I do not provide investment advice, nor do I make any claims or promises that any information here will lead to a profit, loss, or any other result.

Update on June 2020: I haven't owned GAZ, USO, or UNG for many years. It looks like GAZ actually traded lower by October 2010. I did not learn about "contango" until after I published this post, though I did warn that GAZ "may not necessarily track the actual price of natural gas." I also wrote that GAZ was "an admittedly speculative" investment. A much better post on natural gas can be found here: https://willworkforjustice.blogspot.com/2009/07/commodities-cap-and-trade-and-natural.html 

Under no circumstances do any statements here represent a recommendation to buy or sell securities or make any kind of an investment. You are responsible for your own due diligence. To summarize, I do not provide investment advice, nor do I make any claims or promises that any information here will lead to a profit, loss, or any other result.

U.S. Supreme Court to Decide Important Free Speech Case

Click HERE for a transcript from the Supreme Court's oral arguments in Holder v. Humanitarian Law Project. [Click on "Full Screen" after the jump to enlarge the text.] 

The Humanitarian case might determine the breadth and scope of power the American government may exercise when it wants to control speech. Amazingly, the case and its complex issues aren't front page news everywhere. Below are some off-the-cuff comments I made after I read the transcript: 

The pro-free-speech lawyer, Cole, didn't do a great job. There was some drama: Scalia verbally smacked Sotomayor when she raised a misguided example, but Breyer played the good knight and saved her. Justice "That's Not True" Alito looked out of his range intellectually. None of the lawyers were able to really answer Ginsburg's very relevant questions. Breyer, as usual, asked the most interesting and intelligent questions. Scalia clearly wants to kick the ball down the road and uphold the statute. Unfortunately, it appears Kennedy, the swing vote, might be leaning towards Scalia's angle due to the unusual fact pattern involved, i.e., the government did not actually convict anyone for exercise of free speech (the case involves an action for declaratory relief, not an actual prosecution or conviction). Surprisingly, Roberts looked like he hadn't yet made up his mind, though towards the end, he seemed to be leaning towards Constitutional avoidance. Unsurprisingly, Thomas never asked a question. 

Actually, come to think of it, neither lawyer did well. The government's lawyer, Kagan, started off very well, but self-destructed at the end, when she suggested the government could prosecute lawyers who submit briefs on behalf of Congressionally-labeled terrorist organizations, even if the briefs relate to tsunami relief or U.N. aid requests. She should have thought harder about her audience. She's talking to a bunch of former lawyers who used to write briefs and in-house advisory opinions for sometimes-not-so-wonderful organizations. Maybe that's why former corporate attorney Roberts seems conflicted. 

After I emailed the transcript to an acquaintance, I sent him more detailed comments: 

The fact that the Justices spent most of their time discussing hypotheticals indicates that no one really knows what kind of conduct is prohibited. If the Justices can't figure out what is covered, then how is an ordinary American supposed to comply with the law? As for Scalia trying to kick the ball down the road, isn't the whole point of a request for declaratory relief precisely to avoid kicking the ball down the road and having to deal with a prosecution? 

What really bothers me is that no one answered Justice Ginsburg's perfectly valid questions. For example, everyone agrees that membership isn't proscribed, but then what? Are we supposed to just show up to a meeting and sit there to ensure we comply with the statute? Kagan seems to say anything beyond being an inactive paper member of an organization could be proscribed conduct, and it's up to the prosecutors to determine the scope of the law. Sorry, but I'd rather have a clear line than a line drawn by the Supreme Court than thousands of politically ambitious D.A.s deciding what constitutes inactive, legal membership in their own discrete jurisdictions. 

Also, I am a member of numerous legal organizations. I've attended annual meetings, communicated with board members, dispensed legal advice to schools they operate, posted on their blogs, etc. For all I know, one of these organizations might have rogue members plotting against the government. If the Court doesn't narrow the law and require a specific intent provision, then I could potentially be prosecuted merely by being an active member of the overall group, despite lacking any malicious intent. Thus, Kagan's argument boils down to this: trust the government, because we won't prosecute someone who isn't really a terrorist. I'm sorry, but if you're a Muslim in 2010, a Japanese-American in 1942, an African-American with Black Panther friends in 1965, etc, it's a little harder to trust prosecutorial discretion. 

Practically speaking, if the conservative Justices have their way, any lawyer with Muslim clients or Islamic non-profit clients must consider dropping all of them as clients. After all, who knows? If one person within an organization is supporting terrorism, then the entire organization becomes suspect, and anyone who has helped the organization, even in good faith, can be held liable for material support. Just my two cents.

Monks and Nuns in Love

Last Sunday's NYT published a beautiful love story. See HERE for more.

To all the American Newborns: You Owe a Trillion Dollars, Thanks to Mommy and Daddy

Mish has done an excellent analysis on the trillion dollar public sector benefit problem. See HERE for more. It's horrifying and edifying at the same time. Sigh.

First Date Ritual

Do any of you have pre-first-date rituals? I have a few things I do before a first date.

I have an older American car (from 2003), and it's not worth much, so I try to spend as little as possible on it. On date night, however, I like to get the car washed and inflate the tires.

Usually, I go straight from work to the date, so in the morning, I spend an extra half hour fussing about my appearance. For example, I use a straight razor instead of my usual electric one, and I cut the hair on my nape.

As for my clothes, I usually stick with a business casual outfit, which tends to be a nice white collared shirt and a pair of new jeans. I wear my faded Wrangler jeans all the time, so I use another pair of jeans, which I rarely wear, on dates.

I have Drakkar Noir cologne and toothpaste/mouthwash in the office, so I use those before I go. (I bought the Drakkar Noir cologne because of a Dale Earnhardt, Jr. car promotion.)

I should probably add hair gel, but I don't use hair gel enough to justify buying any. For some reason, most of the hair gels I see come in large tubes that would take me years to finish.

Sometimes, I forget to wear a belt, but I fix that issue if there is a second date. Unfortunately, I have to wake up earlier than usual to do all the administrative stuff, and changing my sleeping patterns leaves me in a tired mood. I make up for it by taking a small nap in the afternoon.

I fully realize I sound like a bad Southern caricature--Wrangler jeans, Earnhardt car collection, no hair gel, no belt, old American car, etc. I tend to just come in casually, even when I implicitly realize the dating game requires some song and dance. At the same time, my casual approach should weed out the materialistic, shallow women, so I'd like to think it all balances out. Besides, my white collared shirt is from Nordstrom or another higher-end retail store, so at least there's one hoity-toity part to my first date ritual.

I have no idea if my first date ritual works, but I'm in no rush. I hear good things come to those who wait.

Big v. Small: Telephone Edition

The battle continues: Here is an article about telephone companies against new tech companies. The seedy understory is that telephone companies don't want to share their lines or subscribers with smaller telephone companies, so they might be ripping out the copper wiring in some areas.

Then, to avoid regulation and possibly to avoid sharing new fiber optics lines with smaller competitors, some companies have apparently convinced courts that their newer fiber optic lines transmit "information," not telephone calls, so the state PUC isn't the appropriate regulator. Such a strategy would help big phone companies take care of smaller telephone competitors, but it may also open the door for companies like Cbeyond (CBEY). (At the same time, I think the FCC, a federal agency, may still regulate telephone companies' fiber optic networks, but that regulation would occur at the distant federal level, not the more local state level.)