How to Pitch Like Baba Booey

They Call Me Baba Booey

Gary Dell'Abate (aka Baba Booey) is one of the greatest radio personalities on the planet is Howard Stern's producer. Gary was visiting Torrance, California this weekend for his book signing "They Call Me Baba Booey" and also appeared on the Jimmy Kimmel show to redeem himself to show everyone he can throw a baseball properly.   If you listen to the Howard Stern Show on Sirius / XM on a daily basis you will know about his famous pitch at the Mets game earlier this year and then now on the Jimmy Kimmel show.  In the 2nd video below from the Jimmy Kimmel show, he hits a woman in the head and an audience member catches the wide pitch. He has thrown 4 pitches and they all have been wild pitches.  I love him but Gary how can you possibly coach your son's baseball team? I hope you are not the pitching coach.  On a side note, Howard Stern's contract ends this year and it remains to be seen if he will stay with Sirius or move to a new company like Pandora internet radio.  Gary will likely follow him there having been together for more than 25 years.  This should be a great book to read given all of the goofy bits over the last 2 decades.

Hilarious Video: The Federal Reserve Explained: Understanding the Central Bank of the United States

Kudos to Omid Malekan, who created this amazing video explaining quantitative easing to the average person to understand. This comes on the on the heals of a great video about why mobile phone consumers are so dumb the company has come . In this new video the two characters discuss the Federal Reserve's quantitative easing policy. The present it as a desperate and hopelessly misguided effort to save the world economy. One issue I have with the short film is that it also places the blame on Goldman Sachs which I don't agree with. They are simply helping to execute and should not be brought into this. 

The Federal Reserve, often simply referred to as "the Fed," is the central bank of the United States. Established by Congress in 1913 with the enactment of the Federal Reserve Act, its primary purpose is to provide the nation with a safe, flexible, and stable monetary and financial system. Understanding the structure and functions of the Federal Reserve is crucial for comprehending how the U.S. economy operates and how it is managed.

Structure of the Federal Reserve

The Federal Reserve System is comprised of several key components, each with distinct roles and responsibilities:

1. Board of Governors: Located in Washington, D.C., the Board of Governors consists of seven members appointed by the President and confirmed by the Senate. These governors serve 14-year terms, ensuring a degree of independence from political pressure. The Board oversees the operations of the Federal Reserve Banks and sets key monetary policies.

2. Federal Reserve Banks: There are 12 regional Federal Reserve Banks located in major cities across the United States. Each bank serves a specific geographic area and functions as the operating arm of the central banking system. These banks handle various financial services, including clearing checks, distributing currency, and supervising and regulating member banks.

3. Federal Open Market Committee (FOMC): The FOMC is the body responsible for setting monetary policy, including interest rates and the growth of the money supply. It comprises the seven members of the Board of Governors and five of the 12 Reserve Bank presidents. The FOMC meets regularly to assess economic conditions and make policy decisions aimed at achieving maximum employment, stable prices, and moderate long-term interest rates.

4. Member Banks: These are private banks that are part of the Federal Reserve System. They hold stock in their regional Federal Reserve Bank and are subject to its regulations. Member banks play a critical role in the implementation of monetary policy by lending to and borrowing from the Federal Reserve.

Functions of the Federal Reserve

The Federal Reserve performs several essential functions that help maintain the stability and health of the U.S. economy:

1. Monetary Policy: The Fed controls the nation’s money supply and interest rates to achieve macroeconomic objectives such as controlling inflation, managing employment levels, and maintaining financial stability. It adjusts the federal funds rate, which influences overall economic activity, inflation, and employment.

2. Financial Stability: The Federal Reserve monitors and addresses risks to the financial system. It acts as a lender of last resort to banks and other depository institutions during times of financial distress, helping to prevent panic and maintain trust in the financial system.

3. Regulation and Supervision: The Fed regulates and supervises banks to ensure the safety and soundness of the nation’s banking system. It establishes and enforces regulations that promote consumer protection, fair lending practices, and the stability of the financial system.

4. Payment Systems: The Federal Reserve operates the nation’s payment systems, facilitating the secure and efficient transfer of funds. This includes overseeing electronic payments, check clearing, and wire transfers, ensuring the smooth functioning of the financial infrastructure.

5. Consumer Protection: The Fed enforces laws and regulations designed to protect consumers in their financial dealings. This includes regulations on credit, mortgage lending, and the transparency of financial products and services.

Impact and Importance

The Federal Reserve’s actions and policies have profound effects on the economy. By influencing interest rates and regulating the money supply, the Fed plays a crucial role in shaping economic conditions, impacting everything from consumer spending and business investment to inflation and employment rates. Its decisions are closely watched by investors, policymakers, and the general public, as they can significantly impact economic growth and stability.

In summary, the Federal Reserve is a critical institution in the U.S. economic system, tasked with promoting economic stability and growth. Through its various functions and regulatory powers, the Fed helps ensure a stable and efficient financial system, supporting the overall health of the economy. Understanding its operations and objectives is essential for anyone looking to grasp the dynamics of the U.S. economy and its financial markets.

Video: SNL Skit on US Debt to China at G20

In a world where political satire often provides a mirror to societal issues, Saturday Night Live (SNL) has once again captured the public’s imagination with its latest skit. This time, the focus was on the US debt to China, a subject that remains a critical point of contention and debate in global economic circles. The skit, set against the backdrop of the G20 Summit, cleverly intertwined humor with serious undertones, offering a satirical yet thought-provoking commentary on the state of international finance and diplomacy.

Ben Bernanke has Purchased Double D's

The Fed has spent most of the last two decades artificially inflating and deflating the stock market whenever they feel the economy needs a boost or is getting overheated. They know what they do has no direct effect on the economy but its a quick fix and doesn't provide any organic growth. Today, the only weapon the Fed has is the so-called wealth effect by driving the stock market up so people feel wealthier because interest rates are at 0%. The stock market went up 80% in 2009 so investors should be spending 2.4% extra of the entire value of the stock market, which is about two percent of GDP.  Here is a great video explaining the boom and bust cycles and is a warning to all entrepreneurs to stay current with stock and currency markets because it now directly affects you even if you are a small business. Maria Bartiromo sits down with Jeremy Grantham who has made some incredibly good predictions over the last few years.  Has the Fed lost control of the bond market?

The new $600B of quantitative easing goes into the banking and corporate sector of the economy who is largely sitting on the largest cash balance in business history.  They don't need the money at all and it's not the sector of the economy who is going to take our unemployment rate down from 10-15%.  Those who need the stimulus money the most, small business & private investors, can't get it. Seeing a company like General Motors go public again makes me want to puke.  I can think of 100 other companies who deserve to be public companies before GM and that creates far more future value, jobs and innovation in our economy.  GM going public is simply private equity, government money, and investment banker Ponzi scheme.

I was an apart of one of the largest business boom cycles in the late 1990s and there were a lot o great things about that time the US Government, FDIC, and Fed have forgotten.  Investors were pouring money into Venture Capital funds that were providing funding to companies who were providing real long term jobs and creating new markets of innovation.  Much of this money came from the Government in the form of FDIC subsidies and they made lots of money for taking this risk.  Once the bubble burst and hedge funds drove the market 80% lower there was no optimism or money left in the VC industry to spark new growth.  The VC industry has shrunk drastically in the last decade and almost 80% of the VC funds not based in Silicon Valley are virtually out of business (aka "the living dead funds").

Capitalism in general is kind of a Ponzi scheme but it can be done organically if the IPO market is fair and open.  Capitalism also works when Government regulatory agencies stay out of our way and don't favor big business monopolies.  I think if $100B in stimulus for struggling VC funds this would create another boom of optimism that we need.    The Fed and FDIC should also consider an Emergency Fund to fund to solve the overweight population epidemic that is slowing the US economy down.  Here are a few other ways President Obama could help create jobs.

Health & Wellness Venture Capital Funds

I heard an interesting investment thesis yesterday on CNBC that obesity is a major reason for our poor economy. The analyst said that fighting obesity with new health and wellness companies could add nearly $1 trillion dollars to our economy and create lots of jobs.  While at the same time taxing fat and food companies that are responsible for putting this in our diets.  Southern California would undoubtedly be the leading region of the US where outdoor activity and fitness are embedded in our everyday life.  When you travel East or to the Midwest, you begin to really notice how the Country has changed in the last 10 years.  Kids are fat and parents are lazy.  

Over the last 10 years, Venture Capital has become increasingly more specialized and VC funds have become much smaller. The idea fund size in my opinion is around $25-$100M in order to accommodate smaller funding rounds. Health and wellness companies have been criticized by almost every VC fund over the last decade because they are thrown into the category of lifestyle businesses. I think this could soon change if the US Government and Wall Street decide they want to take some companies public and a few private equity groups start looking to buy companies.

This is one reason I think the health and wellness category could emerge as a new investment category that could garner lots of FDIC or government subsidy money.  Are there any funds out there that have the thesis?  If there are I want to know about them because exercise is a passion of mine.   The types of companies a specialized fund would look for would be the following:

1) Running, triathlon, and race organization groups (Marathons, Ironman, 10K Races)
2) Health Food Manufacturing, Distribution & Marketing Companies
3) Exercise Equipment Manufacturing, Distribution & Marketing
4) Adventure & Health Travel Marketing and Organizations
5) Natural supplements and vitamin companies. No drugs allowed
6) Internet publishing - coaching, counseling, advice, therapy
7) Physical therapy, employee health, and chiropractic groups
8) A healthy diet and meal marketing & distribution
9) Software & mobile applications
10) Restaurants (maybe)

How About Some QE for Venture Capital?

"Quantitative Easing" from the Federal Reserve just sounds like another theoretical way to pump up the markets and the economy when they can't drop interest rates any further than 0%. $2 Trillion dollars of Qualitative Easing has already gone into the banking system and what has it done for you and me?  What is another $600B going to do? Absolutely nothing.

It really makes me sick to hear that $600 billion dollars is going to be pumped into the banking system when these are the same "bone heads" along with the Hedge Funds that got us into the mess.  What is the last time you heard a story about a Bank giving money to a company that really needs it?  All bankers do is lend money to companies who don't need it because they are risk averse.  All these morons do take your money and the Feds at 0% and "try" and lend it at 5-15%.

Venture Capital and small business is what drives the US economy and this sector of the economy is still being overlooked.  Organic growth is the ONLY thing that will get the US out of this recession and create jobs. Why not give $100B dollars to some VC Fund Managers or Private Equity Groups at no cost and require them to invest it in the next 12 months?  I guarantee you they will get a return on this investment.  The Venture Capital industry has shrunk drastically in the last decade and I think this is the sole reason why we are still in a recession and will be until politicians recognize this. VC fund managers cannot raise money from LP (Limited Partners) because the returns have been horrible as a result of the IPO market being virtually closed.  Sometimes I think the Federal reserve spends too much time listening to politicians and not enough time in Silicon Valley, Boston, New York, Chicago and Los Angeles where new ideas are created and organic growth is created.