Category Archives: General & Miscellaneous

Will 2016 bring Clinton’s past trading activities back into light?

In the Spring of 1994, the Clinton White House faced questions amidst a newly developing story centering on the First Lady’s commodity trading activities as her husband sought the governorship of Arkansas. How did Hillary Clinton, with no related education or experience, happen to turn a $1,000 investment into nearly $100,000 in less than a year?

What role did her broker (previously suspended from traded and later fined heavily by the exchange for multiple violations), and her trading advisor (who represented the state’s largest employer) play in her fantastic success?

As the 2016 presidential race heads into full swing, the events in question are nearly forty years old, occurring in 1978-1979, while Bill Clinton served as the Arkansas Attorney General and Hillary Clinton worked for the Rose Law Firm. Yet the Clintons had also by that time fully embraced public life, so her private business dealings from the time would still seem to be relevant in an evaluation of her fitness for higher office. Furthermore, the couple’s legal credentials (they met at Yale Law School), would certainly preclude any potential wrongdoing as being characterized as simple youthful indiscretion.

I’ve traded commodities – including cattle futures – and in my own initial review of this case, it’s hard to conclude how Hillary Clinton could’ve achieved the returns she did. It seems far more likely that the Clintons accepted the largesse of a major corporate interest,  relying on a shady broker and advisor who used accounting gimmicks to book phony profits that Hillary later withdrew as cash. That’s my working theory, anyway.

Two recent articles cover this topic in greater depth and are recommended reading for anyone wishing to explore further details or consider their relevance to the 2016 campaign: a piece by Caroline Baum and Victor Niederhoffer, originally written in 1995 and republished this month in National Review; and another by Marc Joffe earlier this year in the Fiscal Times.



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Drudge Report app flap continues, ads a new problem

The latest version of The Drudge Report app retains its signature feature - incredibly small font sizes.

The latest version of The Drudge Report app retains its signature feature – incredibly small font sizes.

About a year ago I reported on the Drudge Report’s troubles with its app, which garnered universally negative reviews from users. One of the main gripes was the incredibly small font size used to display the daily headlines, linking readers to stories from every corner of the web.

Today I checked in with the App Store to see if any changes had been made, and the developer notes that “general maintenance” was performed and a new version released on September 4th.

Unfortunately, the app still suffers from minuscule font sizing and will be useful only to the ocularly gifted.

The latest version continues to earn poor ratings from users in the iTunes store, who note the font

An ad in the app sends users to the Candy Crush game in the App Store

An ad in the app sends users to the Candy Crush game in the App Store

trouble but also cite a new problem: full page pop-up ads frequently accost readers, often redirecting them to buy games in the App Store. At the moment, the updated app averages a paltry one star rating from more than 100 reviews.

I downloaded the app (using an iPhone 5s) and can confirm these problems. It also seems to be a bit slow in loading and navigating, although without testing it on different networks, I can’t confirm with certainty that the issue is caused by the app and not by a slow wi-fi connection or some other local network issue.

It remains a mystery why a new media pioneer like Matt Drudge would be plagued by these types of ongoing technology problems.

For iPhone users, the site is best viewed with a browser at

For iPhone users, the site is best viewed with a browser at

For now, a better option for reading The Drudge Report, at least for iPhone users, is to visit using Safari, and bookmark the page.The fonts are still small but basically readable, and there are no pop-up ads. 



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Chicago Tribune scrutinizes CPS bond deal

The Chicago Tribune published an extensive, front page feature on the Chicago Public School District’s use of innovative borrowing strategies over the last decade, which appears to have backfired and inflated borrowing costs by $100 million.

Appearing in the Sunday print edition of the newspaper, the story centers around the district’s practice of issuing auction-rate bonds, paired with interest rate swaps, to reduce the cost of borrowing money. In contrast to more traditional, fixed-rate bonds issued by school districts and municipalities, the variable rate instruments were subject to future market conditions and in this case, ultimately moved against the district. Servicing the debt became more costly, and breaking out of the contract required large lump-sum payments.

Several academics, financial professionals and public officials contacted for the story said greater consideration should have been given to the potential risks involved. The district’s financial advisors who crafted the deals defended them, disputing the newspaper’s analysis that concluded that they cost the district $100 million.

A couple notes: first of all, reporters Jason Grotto and Heather Gillers did a great job with this story. It’s a serious, in-depth piece on a local topic of real civic importance, showcasing one of the strengths of newspaper journalism. That’s not to say I endorse every sentence or every shade of tone and nuance in the article, but that’s beside the point. The point is that this is important, engaging reporting. Definitely worth my Sunday subscription price.

Secondly, it should be noted that the district and its financial people weren’t crazy or irresponsible for considering the new type of deals that were being used more often during the early 2000s. Innovation occurs in the financial industry just like every other industry, and just because something is new and more complex, doesn’t mean it’s wrong or irresponsible.

Thirdly, that being said, I believe (and I think most reasonable citizens would believe), that a school district should generally take a conservative approach to resource management and financial planning. That might mean you don’t try to shake a point or two out of every deal, if it means incurring an unpredictable future liability stream.

Fourthly and finally, I thought that the reaction of the CPS advisors in response to this article was lacking, at least in terms of what was published. The competing analysis they submitted in response to the Tribune analysis omitted key information, leaving their defense of the deals less credible. Again, it’s not always wrong to take calculated risks, but if the deals don’t work out, just say that, rather than stretch or skew an analysis stating that they did.

But worst of all was Adela Cepeda‘s attempt to strike back at the newspaper for investigating the public school district’s finances. “I consider the slant of the reporters for this article to be absolutely biased and outright sexist,” she said in a letter to the Tribune. She also criticized the paper for consulting a New York firm to review their own analysis before publishing, only to then use a New York firm herself to submit her own analysis.

Cepeda earned an MBA at the University of Chicago, and was in banking for ten years, according to the article. She married into a politically connected family on the city’s South Side, and very shortly after forming her firm won contracts with CPS. Her partner, David Vitale, is a former Chicago Board of Trade president and currently serves as president of the school board.

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Chicago boasts cheapest Uber fares

ChicagoInno has compared UberX rates across the country and reports that Chicago is the most affordable city in the nation to use the ride-providing service. For a ten mile, twenty minute trip, a passenger in Chicago pays $14.70, versus the national average of $22.74. That’s an $8.04 difference, or 35%. Makes me feel even better about taking Uber in Chicago!

Just for kicks, I also calculated what it would cost to take that same ride in one of our city’s fine taxi cabs. The answer? Nearly double the price of Uber, or $27.85. Here’s how the math breaks down:

UberX and Taxi rates in Chicago, as published by and City of Chicago Chicago Business Affairs & Consumer Protection Department.

UberX and Taxi rates in Chicago, as published by and City of Chicago Chicago Business Affairs & Consumer Protection Department. 

Unfortunately, in my hometown of Kansas City, the same ride will cost you $29.75, making it the seventh most costly locale to take that trip (not sure what it would cost to take the same ride in a cab there). KC is one of Uber’s newer markets, I believe, so that’ll change no doubt as more drivers come on the scene and even out the supply-demand situation there.

The Chicago Tribune picked up the story, and interviewed a local cab industry representative for a response. In hilarious and telling fashion, Peter Ali Enger actually says the low local taxi rates are the reason for Uber’s low fares… but that his cab council has been trying to raise those rates for seven years. 

So while Uber brags about delivering the cheapest possible rates, the cab industry complains that it can’t raise the price you pay even higher. That tells you just about all you need to know as far as why Uber has been killing it the last couple years against the taxi cab companies.


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Law prof: Social, economic incentives already regulate Uber

University of Chicago Law Professor M. Todd Henderson.

University of Chicago Law Professor M. Todd Henderson.

Writing in the Chicago Tribune on Monday, Todd Henderson points out differences between traditional taxi cabs and app-based ride-sharing services, and says each should be regulated accordingly. Uber‘s passenger-generated rating system for drivers, for example, fulfills what would otherwise be a regulatory function to ensure safety and quality of service.

Henderson argues that right now consumers have a choice between heavily regulated taxi cabs, and lightly regulated options like Uber. That’s a choice he believes they should be free to make.


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Uber lowers rates in Chicago

Screen Shot 2014-07-02 at 9.05.50 PMRide-sharing service Uber has cut its rates in Chicago by 25 percent. In an email to users last week, the company highlighted average costs for common routes like the $9 ride from “River to North to Wrigleyville,” or a $20 trip from The Loop to O’Hare. A gratuity for the driver is typically included in Uber prices, depending on the individual user’s settings.

The email offers free rides to new users and for those who invited them to sign up. Tapping social networks to expand its user base is a tactic that epitomizes the young tech-powered company’s rapid growth in the U.S.A. and internationally.

The message also boasts that the new prices make taking an UberX “40% cheaper than a taxi.” The price promotion could signal that the company is seeking to double down on their low cost competitive advantages, although the “fares may only be around for a limited time.”

The price drop should more than offset the recent one dollar surcharge Uber recently added to each ride. In a tweet on April 18, an UberChicago rep told me that the “Safe Ride Fee is simply a way for us to support the increased costs associated with our continued safety efforts.”

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Uber drives the “creative destruction” that moves our economy

John Fund writes in National Review that Uber’s technology-driven transportation service represents the type of creative destruction that  allows free market economies to flourish. The author notes several features that have earned the favor of a growing customer base: 

Uber drivers’ cars are often newer and cleaner than traditional cabs, and customers can easily request upgrades. Drivers are screened, and a passenger can see a picture of the driver and his or her customer-service rating before getting into the car. Low-ranked drivers can be and are removed from the system, an accountability system that’s missing from most cab companies. 

The taxi cab industry has responded by pressuring lawmakers to impose a raft of regulations that would hobble its fledgling competition. 

The cab companies and their allies have scored some victories, but the political contests will likely continue for some time. Citing the company’s recent $18 billion valuation, Fund predicts Uber is not going away anytime soon.

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