Letters To The Editor

The Daily Reckoning - Weekend Edition
May 7-8, 2005
Baltimore, Maryland
By Addison Wiggin and Tom Dyson

MARKET REVIEW: LETTERS TO THE EDITOR

This weekend we dedicate to our readers…we've had some
terrific e-mails recently, entertaining, witty, and far more
insightful than your weekend editor could ever be…Enjoy!

*** An American and a Mexican discuss work ethos…a reader
sends us this fable:

Dear Sir:

An American man went down to Mexico on a vacation.  He
noticed one of the natives came in about 10 a.m. every day. 
One day, he asked the man, 'Why do you come in so early.'

The man replied, 'I have enough fish for today.  I go to
the market and sell the fish.  Then I go home and chat with
my wife.  Then I take a siesta. Then I go to the tavern and
have a few beers with my friends.  Then I come home to my
wife and children and play with my children. Then I eat and
go to bed.'

The man said, 'If you stay out longer, you could catch more
fish.  If you saved the money, you could buy another
fishing boat.  Then you would have more money.  If you
worked hard, you could soon have a fleet of fishing boats. 
You could use the profits to build a cannery, can your own
fish, and sell them worldwide.  You could be incredibly
rich.'

The native replied, 'After that, then what.'

The American thought a minute, and said.  'Why then, you
would have enough money to retire.  You could fish a few
hours every day, come home and chat with your wife. Then
take a siesta.  Then go to the tavern and have a few beers
with your friends.  Then you could come home to your wife
and children and play with your children.  Then you could
eat and go to bed.  And, you could do that every day.'

*** Pass the doobie, man! A thoughtful reader:

Dear Mr. Bonner:
 
Thinking without recourse is masturbation. Face it! People
have no recourse. What is the point in divining everything
if what you have left is the horrible realization of the
size and extent of your own hell? Survival equals denial
equals ignorance. After all in the end, pure animal
instinct must prevail.
 
Things are as they are not as we would have liked them to
be. We ride on the waves of history, on the cusp of
evolution of human society dictated by the laws of its
existence - laws that are heartless and immutable.
 
You believe that we are in control of our existence. Yes,
well to some extent, but that is a mere perturbation on the
cosmic flux which dwarfs are efforts. All you say is true.
But you are just giving a description of the human
experiment. Step back, pretend you are from Mars, become
detached and you will see much more clearly that in essence
we are thinking ourselves into oblivion. We are like a baby
who everyday gets hold of a bigger and more dangerous gun.
One day it will shoot itself.
 
Best wishes,
 
One who thinks too much

*** An anarchist reader…

Dear Daily Reckoning,
 
Just wanted to let you know your Anarchist reader is still
enjoying the Daily Reckoning. Your article on Leon Czolgosz
of course caught my attention with its inaccuracies. Leon
wasn't a well know Anarchist, he probably wasn't even an
Anarchist, just a severely mentally ill individual. Of
course capitalism does that to millions of people. His only
real connection to Anarchism was that Emma Goldman spread
her legs for him. Whether or not she pushed him to
assassinate McKinley is debatable. Poor Mr. McKinley got
what he deserved. How many lives did his little war with
Spain cost? How many lives were disrupted? How about the
Philippines?. His genocidal policies there, which were
continued by Roosevelt, cost 250,000 to 1 million lives of
Philippinos murdered by the U.S. army. Were any of our wars
fought for our freedoms like the politicians say? They just
were fought so the ruling class can further their wealth
and power. We just want to be left alone. Murder of anyone
should not be condoned, even the murder of dirty
politicians like Mr. McKinley, but when our politicians go
around killing people for no other reason than to further
business interests they shouldn't be surprised if those
they deem as worthless strike back. I guess it is all part
of doing business. How sad. Anyway for capitalists I think
you guys are pretty cool. Keep on writing and speaking out,
somebody might even be listening.

best regards,

bill

*** A comment on "Pricey Zip Codes," Tuesday's issue of the
Rude Awakening…

Your newsletter is beginning to resemble the print
newspaper 'Pravda' before the breakup of the Soviet
Union…you may not realize it, but the real meaning of
subtle irony as you are writing in this paragraph (and many
others!) is totally lost on a lot of readers. [See
paragraph below]

This is not a complaint. In fact, the style is humorous.
But it has more sinister implications - what it presages is
that in the not-so-distant future, people will be forced to
write in such a style to get it past dimwitted government
censors. It is the same black humor present in Bulgakov's
'Master and Margarita,' written in the 30s in Russia. You
are, in fact, very sensitive to the times in which we live,
even if you are not consciously aware of it.

The extract in question from the Rude Awakening:

Furthermore, the Brazilian coastline, for all of its
splendor, lies well beyond of the U.S. border - far from
the terrific American public school system, far from the
protection of the U.S. military and far from all of the
other American regulatory authorities that work so
tirelessly to ensure our life, liberty and pursuit of
happiness. Clearly, one does not forego - without careful
consideration - the many protections conferred by the FBI,
CIA, EPA, DEA, FDA, USDA and Alan Greenspan's Federal
Reserve.

*** Check out the link in this letter's P.S…it's a web page
dedicated to Mogambo Guru Acronyms (MGA)…!

Dear Sir,

I've been a Daily Reckoning reader for about three years
now. And to steal a line from Walt Whitman, 'I simmered and
simmered. Bonner brought me to a boil.
 
Also, since I strongly agree with Bonner's writing about
the 'world improvers,' I thought I'd offer this excerpt
from Eric Hoffer's The True Believer, a book I just picked
up today:

A man is likely to mind his own business when it is worth
minding. When it is not, he takes his mind off his own
meaningless affairs by minding other people's business.'
 
This minding of other people's business expresses itself in
gossip, snooping and meddling, and also in feverish
interest in communal, national, and racial affairs. In
running away from ourselves we either fall on our
neighbor's shoulder or fly at his throat. (p. 14)
 
Maybe fodder for one of Bonner's future essays….
 
All the best,

R. H.
 
P.S. - Since I greatly enjoy reading The Mogambo Guru's
weekly column, and because I'm the owner of a site that
indexes acronyms and abbreviations, I decided to add a page
to my web site that is totally dedicated to the ridiculous
acronyms The Mogambo Guru creates. It will take time to
build the list, but at least the work has been started. You
can take a look here:
 
http://www.acronym-guide.com/mogambo-guru-acronyms.html

*** This reader forwards us a letter about energy
technology, from an expert…

Dear Sir:

This is an interesting comment on the energy situation.
Received this today from our friend Bob Gibbs in Cleveland. 
Bob has his own company and sells transformers and switch
gear to power companies and others who operate their own
power plants.  I think he knows what he's talking about.
 
Dick

[And Bob's comment…]
 
Dick,

Nuclear Power is having a rebirth. The newer design does
away with these cooling tower types of installation. It is
called a PBMR (pebble bed modular reactor) which is smaller
and cheaper, takes about 24 months to build and lasts about
40 years. They are much safer. Inside a PBMR, there is a
bed of high temperature silicon graphite balls each about
the size of a billiard ball. About 70 % of the balls have
flecks of uranium. When they interact, the bed of graphite
balls gets hot. The gas carries the heat to a turbine. If
the core hits peak temperature of about 1600 deg. C, it
starts to cool itself down automatically. There is no
uncontained chain reaction to cause a meltdown as in the
existing type of plants. Also they are built to store their
own waste in the basement with storage space for forty
years of operation. Of course, the Sierra Club and others
will still find fault with this.

In the next 15 years, China will need to generate at least
six times what it already generates or at least two of
these nuclear reactors per year. India has the same
expected growth. You hear a lot about the wind power being
so clean, etc., but it is small potatoes. Four of these
nuclear reactors could generate more than all of the
existing wind power turbines in California and use very
little real estate to do so.

Surprisingly enough, this rebirth of nuclear does not mean
the demise of coal because there also is new coal
technology. The world has about a 300-year coal supply.
China now generates about 70% of their power with coal.
Coal presents two problems: Transportation and dirty
burning. Both of these are being solved by liquefying coal
for cleaner burning and it will be a lot easier for the
Chinese to get coal via a pipeline from the north of China
to where the factories are in southern China. This
technology is like turning coal into oil.

Uranium has been rising in costs because of the rebirth of
nuclear. It is now about $20/lb. At that price, relative
present fuel costs are:

Coal -  $1.25 per million BTU
Natural Gas - $3.5 per million BTU
Oil - $6.00 per million BTU
Uranium - $0.055 per million BTU

Let's assume that Uranium increases to 50 times the current
price as demand picks up again. The new PBMR nuclear plants
would provide energy at the equivalent to buying gasoline
at 1/2 cent per gallon.

Most of the world's untapped coal reserves are in the U.S.,
northern China, Australia and Canada.

The U.S., Canada and Australia have the greatest part of
the world's uranium.

The best news of all is that there is one place in the
world that does not have much of these reserves and that is
the Middle East. Wouldn't it be nice to be around when we
don't need them anymore and they have to fend for
themselves.

Jimmy Carter is a wonderful person, but I considered him
about the dumbest president ever. At the time of his energy
comments and decisions, I said that there was no such thing
as an energy shortage. There was only a shortage of energy
knowledge.

Lawyers and environmentalists create energy problems.
Scientists and engineers resolve them.

[Ed. Note: We always read every email you send to us,
although sometimes we don't have time to respond. Please
keep 'em coming!

Tom Dyson
The Daily Reckoning

P.S. We'd normally be skeptical about the opportunity to
make 10,000% in a small stock, because in real life, it
never actually happens. But this is exactly the bold claim
Jonathan Kolber, editor of Vantage Point Investment
Advisory, is making about a small company he's discovered
in Iceland.

Of course, you are a skeptical reader of the Daily
Reckoning, so you won't want to read about a publicly
traded company that might change the future of mankind:

http://www.agora-inc.com/reports/VPI/WVPIF509

--- Daily Reckoning Book Of The Week ---

The New Market Wizards: Conversations with America's Top
Traders REPRINT Edition
By Jack Schwager

This is definitely one of the three most essential books on
trading. Schwager interviews institutional big-hitters,
guys who trade millions of dollars every day, guys who
control the markets, guys who have ticker tapes running by
their beds and showers, guys like Sperandeo, Druckenmiller,
Eckhardt, and the Turtles.

It's a great look into the lives of real moneymakers…

http://www.invest-store.com/dailyreckoning/mi/?i=2244

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THIS WEEK in THE DAILY RECKONING: Hmmm…great stuff this
week. For instance, did you realize quite how funny Warren
Buffett and Charlie Munger can be? Our colleague Sala
Kannan went to Omaha and watched their comedy…it's all in
Tuesday's DR guest essay, below…

THE WALL ST FANDANGO  05/06/05
By Bill Bonner

"Investors look up to their Wall Street stockbroker with
adoring eyes…they see him as the kind family doctor…
Bill Bonner points out, however, the only purpose they
serve is to separate a fool from his money…"
http://www.dailyreckoning.com/Issues/2005/DR050605.html

BILLIONAIRE ECONOMISTS          05/05/05
By Mark Skousen

We all know that most economists are ivory tower academics
whose ideas hold no practical value…but, as Mark Skousen
recently pointed out in a speech - like it or not, they
have made their mark…and are here to stay. Read on…
http://www.dailyreckoning.com/Issues/2005/DR050505.html

ASSASSINS, ANARCHISTS AND THE MARKET  05/04/05
By James Boric

"When the market turns ugly, instead of panicking,
investors should go with the flow. Easier said than done,
but as James Boric shows us, if you can adapt your trading
strategies, you will always come out on top…"
http://www.dailyreckoning.com/Issues/2005/DR050405.html

THE ORALCE OF OMAHA   05/03/05
By Sala Kannan

"Those who went to Berkshire Hathaway's shareholder's
meeting expecting a straight-laced event full of serious
people would have been in for a surprise. Sala Kannan
describes the funniest lesson in economics she has ever
had…"
http://www.dailyreckoning.com/Issues/2005/DR050305.html

AMERICA'S GET-RICH-QUICK-SCHEME  05/02/05
By The Mogambo Guru

"In 2004, the Maryland Lottery did almost $1.4 billion
dollars in sales - and that's only one state. This could
just mean one thing - not only are Americans desperate to
get rich - they wish to do so without lifting a finger…"
http://www.dailyreckoning.com/Issues/2005/DR050205.html

--- Advertisement ----

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HEADLINE, NEWS And INSIGHT: What about the rich economist?
Or the economist who bets it all and goes broke on a
prediction? You've heard of these famous economists…now
check out Mark Skousen's essay about them:

THE ONE ARM CONTRARIAN
By Mark Skousen

"He did have the unique ability to buy at the bottom. Some
people just don't know where the top is, but they're really
good at buying at the bottom and knowing that this is a
bargain. And that was Keynes."
http://www.dailyreckoning.com/Featured/OneArm.html

ECONOMIC CASTLES
By Sala Kannan

"He said they were sitting on $44 billion in cash and
wished they could buy something bigger. 'The check will
clear, I assure you,' Buffett joked, 'Right now we have
more money than brains.'"
http://www.dailyreckoning.com/Featured/EconomicCastles.html

------------------------
 
FLOTSAM AND JETSAM: Did you ever turn down the chance to
invest in a small-cap biotech company for literally pennies
on the dollar and then watch the stock price soar to the
stratosphere? That's what happened to James Boric's Dad…

THE A-WORD
By James Boric

In the weeks to come you will be hearing a lot about a
small biotech company from Iceland. It has a heart attack
drug in the late stages of FDA approval. And if it makes it
to market, this tiny company could quickly become as well
known as Merck and Roche. In fact…

Both Merck and Roche have already established partnerships
with the Icelandic company. And that's just the beginning…

The National Institute of Health recently signed a $24
million contract with this company to learn more about
allergies and infectious diseases. And well known
institutions like Merrill Lynch and T. Rowe Price are
holding shares of its stock right now.

Even Forbes.com recently said this company could rake in up
to $1 billion if this ONE drug is approved. (And they still
have dozens more in the pipeline after that).

I'll explain how you can easily make between 5,000% and
10,000% investing in this company before anyone else finds
out about it. . But first I want to tell you about a
similar situation that happened in the 1980s…

Every time I go home to Cincinnati to see my dad we end up
talking about the stock market. And every time he brings up
the "A-word."

It kills him to this day. You see…

In the mid 1980s, my dad had the chance to invest in a
small-cap biotech company for literally pennies on the
dollar. Split-adjusted, he could have bought in for about
40 cents a share. And it certainly seemed like a promising
opportunity.

The company had a couple drugs in the pipeline that could
treat kidney and cancer patients alike. Problem was, my dad
didn't understand what the heck things like recombinant DNA
and molecular biology were. So he opted not to invest.

If I'm not mistaken, he put his money in Janus instead. Too
bad.

The small, unknown company he passed up on was Amgen. And
as we all know now (none more so than my dad), Amgen stock
went from 40 cents a pop in 1986 to $59 today. That's a
mere 14,650% gain. And the stock actually went as high as
$80 in July of 2000.

Of course, hindsight is always 20-20. My dad knows this.
Truth be told, he made the right decision not investing in
a company he didn't understand. And that's why I am writing
to you today. I don't want you to miss a chance like Amgen
simply because you don't understand the opportunity.

Last July I hired an emerging technology expert to edit a
letter we call Vantage Point Investment Advisory. The
expert's name is Jonathan Kolber. And for over 20 years he
has been a pioneer in the technology and biotechnology
fields.

Jonathan started a company that developed and patented the
technology behind those limited-use Disney DVDs that
national chains like 7-Eleven and Papa John's are selling.
He co-founded a company that went on to invent the world's
toughest lock - which the Federal Reserve and Alan
Greenspan use to guard their most prized possessions. And
he's personally made 20 times his money investing in some
of the most promising upstart technology companies on
earth…companies like Amgen and this latest little biotech
gem…

About two months ago, Jonathan told me about this Icelandic
biotech company that has already landed contracts with
Roche and Merck…received a $24 million contract from the
National Institute of Health…and Forbes.com recently
predicted it will make up to $1 billion in sales from its
new heart drug.

To put that in perspective, the company's entire market cap
is barely over $300 million right now. So he's talking
about a huge rise in the coming years - 10,000% or more
when it's all said and done with.

It's not hard to see why when you look at the facts.

As of right now, this company has a half dozen drugs
waiting in the pipeline that could treat everything from
heart disease, diabetes, obesity, arteriosclerosis, asthma,
strokes and schizophrenia. We're talking about hundreds of
BILLIONS of dollars in sales if just a few of these drugs
make it big. And the first big break could come very soon…

This small, unknown Icelandic company already has heart
attack drug that is in the later stages of FDA approval.
And if it makes it to market (and Jonathan thinks it will),
Forbes.com predicts this company well sell up to a billion
a year in the drug. But the kicker is…

It still has a dozen other candidates in the works - all of
which could be worth untold billions.

Of course, we've all heard these pie-in-the-sky stories
before. But there's something unique about this company -
which is why the big boys (Merck and Roche) in the industry
are lining up to partner with it.

This company has pioneered a one-of-a-kind method for
pinpointing genetic factors involved in a person's
predisposition to disease. Basically, it's cracked the
codes in the human genome that make people more likely to
develop 50 of the most common diseases in Earth.

Think of it like this…

Every other biotech and pharma company uses a shotgun
approach to treating disease. They attack just as many
healthy tissues and cell in hopes of also ridding you of
the sick cells. Not this company. It targets the disease
head on - actually treating the genetic defect that causes
a disease. And the results are staggering…

Using this novel approach, patients can experience vastly
fewer side effects than current treatments. And early
investors have the opportunity to walk away with 10,000%
profits or more.

Jonathan believes you could invest $5,000 in this company
now and watch it turn into a quarter of a million or more
when everyone discovers it. And unlike my dad in the 1980s,
Jonathan knows what he is talking about.

Check out his free report on the company. It would be a
shame to miss out…again.

http://www.agora-inc.com/reports/VPI/WVPIF509

Best regards,

James Boric
for The Daily Reckoning

P.S. Starting June 1, the price to get into Jonathan
Kolber's Vantage Point Investment Advisory will rise from
$249 to $1,000. Please don't miss your chance to get in now
- and find out about what could easily be the next Amgen.

http://www.agora-inc.com/reports/VPI/WVPIF509

-----------------------

And the Markets… (Courtesy of the Rude Awakening)

	Friday	Thursday	This week	Year-to-Date
DOW	10,345	10,340	153	-4.1%
S&P	1,171	1,173	15	-3.3%
NASDAQ	1,967	1,962	46	-9.6%
10-year Treasury	4.27%	4.16%	0.06	0.05
30-year Treasury	4.63%	4.58%	0.12	-0.19
Russell 2000	597	596	17	-8.4%
Gold	$426.20	$430.02	-$8.19	-2.6%
Silver	$6.93	$7.05	$0.02	1.8%
CRB	300.46	300.20	-3.28	5.8%
WTI NYMEX CRUDE	$50.90	$50.83	$1.18	17.1%
Yen (YEN/USD)	JPY 105.03	JPY 104.49	-0.18	-2.4%
Dollar (USD/EUR)	$1.2815	$1.2957	55	5.5%
Dollar (USD/GBP)	$1.8900	$1.9055	179	1.5%

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