It is up to us to carry this out!

Today on MSNBC, president Obama said that if the investigation into the September 11 attack on the American compound in Benghazi, Libya finds that "there was a big breakdown, and somebody didn't do their job, they'll be held accountable."

The truth, of course, is that all indications are that the person who did not do his job is Obama himself. You can be sure that Obama will not take responsibility for withholding help from those under attack. You can be sure that Obama will not take responsibility for lying to America about what happened. You can be sure that Obama will not take responsibility for failing to send additional security to the embassy when it was repeatedly requested prior to September 11.

But Obama should be held accountable. He must be held accountable. On election day, it is up to all of us. Let's hold Obama accountable. He has to be voted out.

So here it is one more time:

OBAMA HAS GOT TO GO!!!!!!!!!!!

Eight Days Left

The election will be in just eight days. This morning, I actually read a serious discussion about whether or not hurricae Sandy will help or hurt president Obama in the voting. There are scores of discussions about polls and trends. There are tons of articles about Romney's expanding the playing field to new states and whether that is a good strategy. What is so striking about all this to me is that there are painfully few articles and little discussion about the policies that Romney or Obama would follow once elected. Romney gave a major speech on economic policy, but the coverage is all about polls and tactics. It seems as if the media is writing only for political junkies like me and not for voters who may still need to decide. Those folks are left to the TV ads that hardly convey much in 30 seconds as a source of information.

Now you may say that by this point in the campaign, anyone who is still undecided has only themselves to blame for not paying attention. That may be true, but these are still people who will vote and, in this year, who may actually pick the next president. Shouldn't these people have full information when they do vote?

Stephanie Cutter -- the Biggest Liar on the Obama Team

President Obama is a liar. America knows this. We have seen him tell one whopper after another. It is hard even to list his greatest lies; there are just too many. Even worse, the staff of the Obama campaign has taken lying to heart and uses it as an everyday strategy. Nevertheless, the Obama staffer who has raised lying to almost an Olympic event is Stephanie Cutter the Deputy Campaign Manager for Obama. Cutter, you may remember is the one who called Romney a felon and then denied ever saying that even though she was on video. Cutter is the one who said she had no knowledge about the facts of the Obama ad in which Romney is acused of causing the death of the wife of a former employee of a company that Bain Capital had invested in. Of course, when it then came out that Cutter had hosted a press event for the purpose of getting the details of that very woman's death at which the information she claimed not to know was completely presented, Cutter just ignored the discrepancy. The list goes on, but I have to add today's lies.

On ABC this morning, Cutter was asked about the endorsement of Romney by the Des Moines Register. This was the first time since 1972 that the Register endorsed the Republican candidate for president. Here is what Cutter had to say, in part,

CUTTER: Well, you know, they endorsed Mitt Romney in the primary, so this was not much of a surprise. It was a little surprising to read that editorial, because it didn't seem to be based at all in reality, not just in the president's record, but in Mitt Romney's record. It says that he'd reach across the aisle, which he'd do the exact opposite. It's the exact opposite of what he did in Massachusetts.


So there you have it. Cutter is telling America that in Massachusetts, Romney as governor did not reach across the aisle to Democrats. Huh? The Massachusetts legislature was 85% Democrats when Romney was governor. Obviously, Romney worked with the Democrats. Had he not done so, he could not have gotten anything passed. He would have had no budget. He would have had no expenditures. He could not have made any appointments. Well, someone needs to explain to Cutter that Romney did pass laws; he did have budgets (which by the way were balanced); he did get his appointments approved. Cutter is obviously just making it up as she goes along. Shame on you Stephanie Cutter.

Rage is Spreading

I just watched a video of Pat Caddell discussing Libya and the Obama response to the attack in Benghazi. Remember, Caddell was the pollster for Jimmy Carter and is a Democrat. He is furious about the failure by the White House to authorize any assistance to the Benghazi embassy while it was under attack. He is doubly furious at the media for its failure to cover this story.

The truth is that as more and more information comes out, it has become clear that president Obama and his team put the impact of the Libya attack on the Obama re-election effort ahead of the need to save the lives of the American personnel at the embassy. Obama's conduct cannot be forgiven. He had to know what was happening; he had to know that there were requests for assistance; he had to know that those requests were denied. Indeed, most likely, Obama is the one who made the decision to let those folks fend for themselves. He is responsible for their deaths.

Obama has got to go!!!!!!!!!!!!!!!!

Sandy on the Way

I spent the morning getting ready for the unwanted arrival of hurricane Sandy to this area. According to the latest news, we will not get a direct hit, but they still expect us to get hit with just less than hurricane force winds, three inches of rain and a major storm surge. To say the least, having a hurricane come this close is not a normal event around here. In the last thirty years, it has happened twice that I recall.

The predicted path of the hurricane is just so weird that it seem hard to accept that the storm will make a westward turn tonight and swing into New Jersey. But we have to get ready nevertheless.

Hopefully, the storm will fizzle. Let's pray for that outcome.

Watching a Sinking Ship

President Obama's job approval numbers have declined by 7% in the Gallup poll over the last few days. In the Rasmussen poll, the decline has been by 6%. The most interesting thing, however, is that almost no one has explained the clear reason for the decline. I can sum it up in one word: BENGHAZI.

The last five days have seen the terror attack in Benghazi change from a story about why Obama and the White House lied for so long about this being a terror attack to a much bleaker story line for Obama. The issue now is why Obama ignored repeated requests for assistance by the embassy DURING the attack and why Obama prevented assistance from the military to the annex of the embassy which was under attack a few hours later. Indeed, half of the deaths of Americans occured in the attack on the annex fully eight hours after the initial attack on the embassy. It is undisputed that the USA had capability to get military forces into place to defend the embassy and the annex within just an hour or two of the start of the attack. Instead, Obama did nothing. As president of the United States, his most important responsibility is to defend America and keep it safe, but Obama did nothing to help these Americans under fire. For Obama, the risk that something might go wrong and thereby harm his re-election effort was much bigger than the loss of a few diplomats or CIA personnel.

Fortunately, the country does not agree with Obama. We think that Obama had to try to defend these folks when they were attacked by the terrorists. We think that any consideration by Obama that his re-election was more important than the lives of our fellow countrymen is disgusting. This is why Obama's job approval is tanking.

And it is going to get worse! Right now, much of the media is still ignoring this story. They cannot keep it up, however. The parents of two of the men who were killed are speaking out; their words will be heard, and not just on Fox News and talk radio. These parents will speak and America is hearing them.

If there was any doubt before, there can be none now: Obama does not deserve to be president.

Must Be a New Holiday Tradition

They are celebrating the Moslem holiday of Eid al-Adha throughout the world today. In Syria, a ceasefire between the forces of the Assad regime and the rebels was arranged to allow Moslems properly to observe the event. Assad, it seems, is seeking to start a new tradition regarding the proper observance of the holiday. Syrian forces under Assad's control attacked Damascus and Aleppo (the country's two largest cities) and over 150 civilians are dead as a result.

We need to congratulate president Obama once again for his failure to engage in any menaingful way with the rebels. Right now, the United States has no influence over those rebels. Meanwhile, al Qaeda is repeatedly calling for Syrians to support the rebellion. Once Assad falls (and he will), America will have no ties to the new government, but al Qaeda will. It is hard to imagine how Obama could have handled the Syrian mess any worse. Geez, you would think it was Libya.

Who Are These People??

After nearly four years of president Obama and vice president Biden with a lengthy campaign before that, I figured that I knew who they were. Now, I have seen something that makes me question that belief. If anything, Biden is worse than I thought (and that is pretty bad.)

According to the father of one of the former navy seals who was killed in Benghazi, Biden came over to him at the airport ceremony where his dead son's casket was being brought back for burial and said this to the father and his family: “Did your son always have balls the size of cue balls?"

We are living in a country where the media and big chunks of society go into hysteria because a senate candidate in Indiana says that if a pregnancy results from rape it is the will of God. Indeed, after that remark, it seemed as if MSNBC went into round the clock coverage of nothing else. Biden, however, goes to a man in mourning who is at the airport to see the body of his dead son arrive back on American soil and says: “Did your son always have balls the size of cue balls?" Where is the coverage? Where is the outrage?

Does Biden get a pass because everyone thinks he is an idiot? Does Biden get a pass because he said this incredibly offensive remark just to a grieving parent and not at a political interview? Can it really be that Americans would condone this level of stupidity from a national figure?

Benghazi and the aftermath has handled in a terrible way by Obama. All America got was a pack of lies about a youtube video. As the truth has trickled out we have learned that it was not just lies that were the problem. Obama himself seems to have denied help to Americans under attack because it conflicted with his re-election message.

Obama and Biden have both got to go!!!!!!!!!

Even Biden's Lies are Idiotic

Today, Joe Biden told a crowd that Republican economic plans were sketchy. Then he said "But you can't erase what you've already done, they've voted to extend tax cuts for the very wealthy, giving a $500 trillion dollar tax-cut to 120,000 families."

Where to begin? Biden says that Republicans voted to extend tax cuts for the very wealthy. THAT IS A LIE; IT WAS THE DEMOCRATS WHO VOTED FOR THOSE CUTS. In December of 2010, the House and Senate passed a bill to extend the tax cuts for the wealthy. In the House, there was a 41 vote Democrat majority at the time. In the senate, there was an 18 vote Democrat majority as well. In other words, Democrats were totally in control of both house when these cuts were passed. To top this off, the cuts were passed because they were requested by none other than president Obama who promptly signed the legislation into law. Obama told the country at the time that it was bad economic policy to raise taxes on anyone at a point when the economy was shaky. So Biden is just totally lying when he says that Republicans were the ones to give the tax breaks to the wealthy.

On top of this, Biden is obviously an idiot. The tax break for the wealthy that was passed totalled about $140 billion split over two years. When Biden says the total was $500 trillion he has made the total 3500 times higher than it actually was. Biden did not just mistake trillion for billion; he came up with a totally phony number.

Just When you Think the Libya Story could not get worse, it does!

The event in Benghazi on 9-11 when terrorists attacked the US embassy and killed four people including the ambassador can only be described as terrible. We already knew that the White House received requests from the embassy for increased security prior to the attack but did nothing. We also knew that president Obama was told about the attack within minutes of its beginning but did nothing; indeed, he later went to Las Vegas for a fund raiser while these Americans in Libya were still under attack. We also knew that Obama and his administration lied to the American people for two weeks with regard to whether or not this was even a terror attack or just some crazy response to a youtube video. Earlier this week, we learned that the Pentagon had assets in the area that could have assisted the folks at the embassy during the eight hour attack, but did nothing. It seemed that nothing worse could come out. Then came today's news: Within minutes of the attack starting, the men at the CIA annex in Benghazi who were a few blocks from the embassy heard the gunfire and mortar explosions coming from the embassy. They radioed to their superiors and requested permission to go to help the folks under attack at the embassy. They got word from Washington to do nothing. The CIA folks tried again. They again described the situation and asked permission to go to rescue the people under fire at the embassy. They were again told to stay put and do nothing. Let me be clear: what this means is that Washington told local American forces who could have helped to sit out the fight and leave the embassy personnel to their fate. What happened next is that three men from the CIA annex disobeyed orders and went to the embassy to help defend the place. These were the people who managed to rescue those who remained inside and to sneak them off to the CIA annex. They also recovered the body of the first American to be killed.

But it gets worse. About an hour later, the same terrorists who had attacked the embassy began firing mortars at the CIA installation. CIA personnel were able to illuminate the site of the mortar with a laser, so that American air power could easily have taken out those who were firing at the CIA (who were also those who had killed the ambassador and others). The CIA station made a direct request for help from the US military. America had plenty of assets in the area that could have responded in twenty minutes at the most. Washington again refused to provide assistance!

Leon Panetta said yesterday that the USA could not send armed forces into a situation in Benghazi when it did not know what was happening. There were unarmed surveillance drones flying overhead. There were cables from the embassy itself. There was a strem of information coming from the CIA annex. Americans were under fire. Americans were being killed. The Obamacrats did nothing. NOTHING!!!

The whole response to the attack (about which we had advanced warning) was so incredibly poor, that it is no wonder that Obama and the Obamacrats lied about it for all that time. They surely hoped that they could keep it out of the press just until election day. This disgrace is sufficient, by itself, to justify Obama's defeat on election day. We deserve a president who will care more about protecting Americans than about his re-election.

GDP Statistics Remain Bleak

The government announced this morning that the preliminary estimate of growth of the Gross Domestic Product for the third quarter of 2012 was a rate of 2.0%, a terrible figure. The number bounced back slightly from the 1.3% rate of the previous quarter, but the details show the third quarter number to be just as bad. First of all, business investment declined during the third quarter at a rate of 1.3%; since business investment drives future growth more than any other factor, this bodes poorly for the future. Second, exports also contracted during the quarter at a rate of 1.6%; during the recent presidential debates, we heard Obama tell us how exports were surging, but that seems to be just another falsehood from the president. Third, the biggest contributor to the increase in growth from the second quarter is that government spending and particularly defense spending surged. In little over two months, sequestration will kick in and the same defense spending will be cut dramatically. This means that the future again looks worse.

Simply put, today's report was terrible. Sure, it could have been worse, but the report made clear once again just how difficult the future will be.

A Totally Unscientific Survey

I live in Fairfield County, Connecticut. It is a suburban area with a large number of people who work in the financial industry both locally and on Wall Street. There are also large numbers of professionals like lawyers and doctors, etc. Other than that, it is an area typical of affluent suburbs across the country. Four years ago, the roads were a sea of Obama bumper stickers and lawn signs. Everywhere one went, the Obama signs were there as well. McCain stickers or signs could be found on occasion, but they were outnumbered at least by 50 to 1.

This morning, I decided to count Romney and Obama signs around town as I finished various errands. I counted 18 lawn signs and 13 bumper stickers regarding the presidential race. Amazingly, 17 of the 18 lawn signs were supporting Romney and all but one bumper sticker also supported Romney. In truth, I think I saw more Romney signs today than the number of McCain signs that I saw through the entire 2008 election. Even more telling, the one Obama bumper sticker was for the Obama 2008 campaign and it was peeling off the car. Even more interesting, included in my travels was a visit to Whole Foods. In 2008, the Whole Foods lot was like Obama central. I joked to a friend that one could only park at Whole Foods if one had an Obama sticker. Today, there was not a single Obama sticker in the entire lot.

One other thing I noted: there were lawn signs for Chris Murphy, the Democrat running for the senate, but these were outnumbered by signs for Linda McMahon, the GOP candidate. There were also signs for the various candidates for state senate and the lower house of the legislature as well. There just were no Obama signs.

Now, I am not interpreting this change from 2008 as a sign that Connecticut is going to vote for Romney. We will have to wait for election day to see if that miracle occurs. What this means, however, is that around here, at least, folks seem embarrassed to show support for Obama and the contrary is true for the Romney-Ryan ticket. Michael Barone is out today with a column in which he discusses a swing towards the GOP ticket in affluent suburbs across the Northeast and Midwest. To the extent my unscientific survey means anything, it supports what Barone says the polls are indicating.

Earth to Obama........Over

In another sign that Democrats are worried that Obama may lose, there is an article in the New York Times by Matt Bai in which blame is assigned for the failed campaign strategy of the Obama campaign. Guess who is at fault? That's right, Obama is falling behind because of bad advice from Bill Clinton.

Let me explain: Obama ran his campaign with the strategy of "killing" Romney. In other words, Obama devoted enormous energy and resources ($300 million of negative ads) to portraying Romney as an evil plutocrat who cares only about the rich and who will stomp on the middle class as president. That entire effort went up in smoke when America got to see Romney in person during the debates. Clearly, Romney came through as a knowledgeable man who cares deeply about restoring the economy and who (unlike Obama) actually has a seemingly viable plan to accomplish that goal. Romney even came through as likeable while Obama seemed petty and nasty. Much of the polling movement of the last two weeks has come as these new clearer perceptions of Romney have moved voters from Obama to the GOP.

Supposedly, the Obama team was deciding whether or not to use the "kill Romney" strategy or to go instead with a portrayal of Romney as a flip-flopper. Clinton advised Obama to go with "kill Romney". According to Bai, that makes him responsible for the loss.

All I can say is "Huh?" Obama, and not Clinton, was in charge of the Obama campaign. Obama and not Clinton made the choice of strategies. Obama and not Clinton should be responsible for decisions made by Obama. But like everything else that has gone wrong in the last four years, Obama always blames the result on someone else. For two years, anything that went wrong was the fault of George Bush. Even today, we still hear about the economy that Obama "inherited" from Bush, as if it were some sort of surprise to the president once he took the oath of office. Bush did not push through the stimulus; Bush did not ignore the economy for two years to pass Obamacare over the objections of a majority of Americans; that was all Obama. Still, the problems that this conduct caused were blamed on Bush.

Obama now seems to be moving on to blaming the Clintons. First Hilary got to take responsibility for the disaster in Benghazi. Now, the election problems are due to Bill. In reality, this tells us much more about Obama and his team than it could ever tell us about the Clintons. Team Obama and its leader still think that if they say something, it will be accepted as true and it will be more important than actually doing something. Well, the people of Earth need to get a message through to Obamaland to tell the inhabitants that this view just ain't true. No number of articles planted in the New York Times will change reality. If Obama loses, he will have only himself to blame. Bill Clinton had nothing to do with it. Indeed, Clinton gave Obama probably the best moment of the campaign with his speech at the Democrat convention.

Weekly Unemployment Claims

The numbers are out today for the weekly report on new claims for unemployment. Over the last few weeks, these unemployment figures were bogus. First the number fell dramatically; then it jumped in a major way. We later learned that the strange pattern was due to an "error" or an adjustment with the figures for one or more states. Today's numbers seem to be more likely to be correct. We are back in the range of 360,000 to 370,000 which has been the "normal" for many months. Put another way, this is just another confirmation that the economy has not picked up steam but continues to limp along with extremely slow growth.

Panic is Setting In for the Left

With 13 days to go until election day, it seems pretty clear that the left and president Obama are starting to panic about their election prospects. Obama is in the midst of a five states in one day trip. All this effort just to get the increased local media coverage that comes with a campaign visit is incredible for a sitting president who is spending something like one billion dollars to publicize his candidacy. All it will do is tire Obama out in a major way and make it more likely that he will make some sort of mistake in the next week or so that will come back to haunt him on election day.

The Obama media is also in full melt down. My favorite example of this is an article running on Yahoo news under the headline: "Could Romney Overturn Roe v. Wade?" Really? That's where they are going? Roe v. Wade was handed down by the Supreme Court 40 years ago. Since then, states have been barred from interfering with or preventing abortions during the first trimester of pregnancy and only a few regulations are allowed during the second trimester. The likelihood of the Supreme Court overturning that decision is minuscule; the president cannot do anything to control that. Nevertheless, in an effort to get out all the pro choice voters, Yahoo news is running a story that any knowledgeable person would understand to be completely false. Why must the progressives rely so heavily on lies?

I realize that I should take all these signs of despair as a good thing. Nevertheless, the lying still makes me angry. America deserves better.

Obama Lying to Save his Behind

For the last month and a half, it has been pretty clear that president Obama did nothing to improve security at the United States embassy in Benghazi prior to September 11th despite repeated requests from that embassy for increased security and despite intelligence warnings that terrorists were planning an attack for 9-11 somewhere in the area. We have also known that Obama and the Obamacrats told America falsely for two weeks following the terror attack on 9-11 in Beghazi that killed four Aericans that the whole thing was just a spontaneous outburst in response to a youtube video. The refusal to admit this was a terror attack was extremely annoying, particularly since we had four people dead including the ambassador. It seemed that Obama was having his people talk about the video in an attempt to take attention from his failure to respond to the requests for more security and the intelligence warnings. Now, however, we have learned that Obama's conduct was much, much worse. CBS has published email that came from the State Department to the White House and others within a half hour of the start of the eight hour attack. There were also repeated follow up emails sent from State to the White House including clear statements that this was an ongoing terrorist attack which was continuing for hour after hour. What this means is that Obama had the information almost immediately upon which he could have sent military help to end the attack and to prevent the death of the ambassador and the others. But we know what Obama did after being told of the attack: Obama went back to sleep and took no action whatsoever!!!!!!!

Is it any wonder that Obama and his people have been lying still about Libya? The president ignored his basic obligation to keep Americans safe, particularly our diplomatice personnel. Even the next morning, Obama did nothing but go off to Vegas for a fund raising event. It really is time to bring back that old chant, but with an important difference: PEOPLE DIED AND OBAMA LIED!!!!!

Teaching to Prosperity

In the third presidential debate, president Obama once again made clear that the biggest point in his supposed plan to grow the American economy is to hire more teachers, especially in math and science. That is supposed to get our economy ready for the "jobs of tomorrow".

A year ago, if someone had suggested that this would be the main plank in the Obama economic platform, people would have laughed. Was this a spoof from Saturday Night Live? No one could have expected that Obama would seriously propose this.

Remember, there are about 23 million unemployed or underemployed people in the USA. According to the census bureau, there are about 7 million folks employed as teachers in the country, and this number includes all teachers from nursury schools to graduate schools. If Obama were to hire an additional 5% for his math/science plan, it would reduce the number of unemployed by just over 1%. In other words, carrying out Obama's plan would have essentially no meaningful effect on unemployment or economic growth, but this is the main point put forward by Obama.

While talking about hiring teachers does give Obama something to say, the truth is that most Americans understand just how silly the Obama plan is. Improving education in and of itself is not silly. Expecting the hiring of a few more teachers to help grow the economy, however, is ridiculous. Each time he makes the point, Obama looks like a fool who has no understanding of how the economy works.

Yesterday, Obama put out a new glossy booklet that contains his "plan" for the second term. Guess what the main economic points are: that's right, raising taxes on the wealthy (which everyone agrees will not promote economic growth) and hiring more teachers. Unbelievable!

A Look at GasFrac after the bad news – Should one hold on?

I was in Turkey when Gasfrac Energy Services, Inc. (symbol GFS in Canada and GSFVF on the pink sheets) released its Operational Review Update on October 10th, so I have not written about it previously. The Ops Review, however, was an acknowledgement by GasFrac that things are not going well at all with the company. Indeed, the real question that needs to be answered is whether or not to sell at this point.

Let’s look at the key facts in the Ops Review:
1) Revenue for the third quarter will be about $41 million (US). This is about 30% less than the consensus of analysts immediately before the announcement. In other words, for the third quarter in a row, GasFrac came nowhere near the level of revenue that was expected. Remember that analysts’ expectations about revenue were based to a great extent on the projections made by the company itself. In other words, not only did the company miss the analysts estimates, it also proved that the company’s management had no idea of the real state of Gasfrac’s prospects.
2) GasFrac is reducing costs by limiting itself to staffing only two sets of equipment in the USA and three sets of equipment in Canada. It is important to remember that in the early days, GasFrac purchased ten sets of equipment which cost in the area of $30 million per set. All of that equipment was supposed to have been delivered to the company by the end of 2011, but that schedule slipped so that GasFrac has eight sets with two more due at the end of 2012. What this means is that by the start of 2013, GasFrac will have spent something in the area of $150 million for equipment that will sit idle due to a lack of work. To say the least, this is another indication that GasFrac’s management had no idea of the real state of the company’s prospects. It is possible that the figures for the cost of the idle equipment may be less than stated above, since the delivery was so delayed, but the company has never shared this information with the market.
3) GasFrac’s cost cutting measures are designed so that it will “drive revenue breakeven levels towards $10 million on a monthly basis from previous levels of $14 million.” In typical fashion for GasFrac, we were not told if “revenue breakeven levels” refer to net profits or a net positive cash flow (or positive EBITDA.) Remember, if GasFrac has somewhere between $250 million and $300 million in equipment, the depreciation on that equipment alone will come to between $3 million and $4 million per month.
4) Marketing is going to be focused on Western Canada and Colorado and South Texas in the USA. This is an acknowledgement of the existing reality. It also means, however, that work in the Marcellus or the Utica Shales is not on the radar at this time. Previous positive statements from management about work in Ohio and Pennsylvania are no longer operative.
So what does this all mean?
1) The general rule of thumb with regard to revenue is that a set of equipment in Canada can generate about $65 million per year while a set in the USA can generate about $75 million during the same time. The difference between the two countries is due for the most part to the Spring break up in Canada that stops work and the proximity in the USA of one well to the next. These figures also assume that GasFrac has work to perform for the whole year for these sets. If one uses only $60 million per year for revenue per set, then the new configuration of five sets gives GasFrac a capacity to generate about $300 million for the year. If the cost structure is reduced to a $10 million per month break even, then GasFrac could have $180 million of profit, cash flow or EBITDA (depending on what “revenue breakeven levels” means.)
2) No rational person would expect that the company will reach the $300 million revenue level in 2013. If past history is any guide, the company could be looking at half that amount. We do not have any clear information, however, as to what the true prospects are. We need to hear more from management.
3) In a major positive move, the board dumped the senior management in mid-September. This is the second shake up in a year, and one which will hopefully result in an improvement in performance this time. It also means, however, that when the third quarter report is issued and the conference call held, we will be hearing from a caretaker CEO. In other words, we will not be getting full information; nor will we hear truly meaningful projections.
4) Natural gas prices have bounced back from earlier this year. They are now about double where they stood just 5 months ago. Some respected projections say that because of the dramatic decline in drilling this year, we may see natural gas prices double again before the end of the upcoming winter. Such a price move for natural gas would inevitably lead to a major increase in drilling and a corresponding increase in fracking. GasFrac’s market could rebound in a major way.
5) All of the inherent advantages of the GasFrac process remain in place. Over the long term, fracking with liquid propane ought to have a bright future for environmental, water-usage and production reasons.
Here is what I recommend.
1) GasFrac is a “hold” at the current price levels. I still believe that the company has a decent chance for success in the long term. Further, since the price is now so low, it is now a small investment. I believe that the board should get a chance to find new management for the company and that the new CEO ought to have a decent chance to correct the course of the company. If the price of natural gas does recover, GasFrac could move quickly towards profitability. Indeed, if it can break through in the market and gain work, GasFrac could expand its revenues rapidly with essentially no need for further capital expenditures. It would just take the extra sets out of mothballs.
2) I would not put new money into GasFrac at this point. Giving the company more time is not the same as giving it more money.
3) I could not fault anyone for selling the stock at this point. That is particularly true if you need tax losses for 2012.
DISCLOSURE: I remain long GasFrac stock.

The last two weeks

There are only two weeks left until election day. All across America, there are millions of voters who are finally going to get their say as to who will lead this country over the next four years. There are also millions more who just are not going to vote. Don't let that second group include you. There is a clear choice this time. America can have four more years of economic disaster, or we can get rid of Obama and let Romney restore economic growth to this country. America can have a detached leader who seems to care only about his own political future, or we can get rid of Obama and let Romney restore America's strength in the world. America can have a president who believes that mortgaging our future by incurring extraordinary debt is not a problem, or we can get rid of Obama and begin the march towards putting our fiscal house in order. America can have a president who blatantly lies to the people on subject after subject, or we can get rid of Obama and let Romney bring his honest and moral behavior into a White House that has been notable for rampant dishonesty for the last four years. The list goes on, but the point is clear. Every American needs to go to the polls on election day and vote for Romney.

The Foreign Policy Debate

Tonight's debate between president Obama and governor Romney was supposed to be about foreign policy. That was the predominant topic of the conversation, but the true nature of the debate was about who was more presidential, about which candidate had the better plan for the next four years, and about which candidate could improve the lives of Americans. On that basis, Mitt Romney clearly was the winner tonight.

There were not great disagreements on many of the foreign policy issues discussed. Romney and Obama agreed on Afghanistan, Pakistan, Syria and terrorism in general. Romney, however, had a different take than Obama on China, the strength of America in the world, and the approach to many problems moving into the future. On these topics, Romney was able to point to the failures of the last four years on so many different fronts; more important Romney had a plan for how to deal with each of these problems. Obama spent most of the time trying to paint Romney as a flip-flopper, a dangerous war monger and a neophyte. The silliness of those attacks by Obama was self-evident.

Obama's biggest problem of the night was his nastiness. I do not know if it was stress or anger, but Obama was truly nasty and disrespectful towards Romney in ways that one does not often see from a president of the United States. The low point came when Obama told Romney that the navy now has ships called aircraft carriers on which planes land and ships that go under the water called submarines. Obama spoke to Romney as if Romney were an ignoramus with no knowledge at all about the navy. It was demeaning, and I mean that it was demeaning for Obama. The president should not act that way. There were many other petty attacks put forward by Obama; their total impact was to make Obama look small.

Clearly, Romney came through the debate looking knowledgeable, calm, and in charge. He seemed to have a plan while Obama had none. Romney got to go back to Obama's failures on the economy and the great impact that had reducing America's strength. Romney also got to explain his plan for dealing with China and he did so in a way that makes clear to most folks why that plan is likely to work.

There is still two weeks to go until election day. Barring a last minute surprise, however, I believe that Romney sealed the deal to win the election tonight.

Three Questions

Here are three questions that I would like to see asked of the candidates tonight in the presidential debate:

1) On September 11th, the American embassy in Benghazi was attacked by terrorists in a battle that went on for about eight hours. American armed forces were on ships in the Mediterranean not too far away from Libya. Why did the USA not deploy some marines by helicopter to rescue our beleaguered diplomats?

2) For four years, president Obama has demanded that Israel not build what he calls "settlements" in territory that was under Jordanian control prior to 1967. The effect of that is to demand that areas of Israel's capital city of Jerusalem be kept free of Jews since construction of apartment buildings in growing neighborhoods gets described as "settlement activity". Does it make sense to continue this policy for the next four years, and, if so, why?

3) Over the last six months, China and Japan have been sparring over the ownership of small islands in the sea between them which have been ruled by Japan at least since 1895. The Chinese have sent warships to the area to emphasize their claims to the islands. If armed conflict breaks out between China and Japan, what will America do?

Quote of the Day

A friend of mine sent me his nomination for the quote of the day. I think he got that one right.

"The fact that we are here today to debate raising America's debt limit is a sign of leadership failure. It is a sign that the US Government cannot pay its own bills. It is a sign that we now depend on ongoing financial assistance from foreign countries to finance our Government's reckless fiscal policies. Increasing America 's debt weakens us domestically and internationally. Leadership means that, "the buck stops here.' Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren. America has a debt problem and a failure of leadership. Americans deserve better."
~ Senator Barack H. Obama, March 2006~


h/t Steve Brill

So Is There an Agenda for the Second Obama Term?

We are two weeks and two days from the election. Between now and then, there will be a debate on foreign policy and the usual barrage of tv ads in swing states accompanied by huge rallies and get out the vote efforts. It is not the time when new domestic plans are unveiled. Anything that Romney or Obama want to promote is already out there. Indeed, with the debate focused on foreign policy, it is problematic to even expect much of a discussion of the economy at Monday's debate. So we now can face up to the biggest question that voters must answer: who will do a better job for America and the American people over the next four years?

That's right, the question is not whether or not Obama did a good job during the last four years. That's history; it is over already. The question is what will happen going forward, and who has a better chance of improving the lives of the average American.

This question right now is the one for which Mitt Romney has the better answer as far as the American people are concerned. Anyone who watched either presidential debate knows about Romney's five point plan for the economy and jobs. Anyone who has taken the time to go to Romney's website understands that Romney actually has an extremely detailed fifty-seven part plan that covers those five parts of which Romney spoke. The average American understands that Romney, in the past, has shown himself capable of running a large enterprise like a major corporation or the Olympic Games, so there is a good reason to believe that Mitt could actually carry out his plan to reinvigorate the economy and create jobs and prosperity. Without a doubt, there are gaps in the plan which will need to be filled in should Romney will the election, but the average person has a sense that Romney knows what to do and how to do it. Obama, however, is a different story. Simply put, Obama has no plan for the economy. Oh, we all know that Obama wants to raise taxes on the wealthy, but no one, not even Obama, contends that doing so will create economic growth or new jobs. Obama wants the tax increase for the sake of what he calls "fairness", not growth. Obama also talks about improving the education system, but this is done in general terms; there are no specifics. Here too, no one claims that improving eduction will grow the economy in the short run. Beyond that, Obama talks about the need for "green energy" and all the jobs that support for green energy will bring. Of course, we all know that during the last four years, Obama spent tens, if not hundreds of billions of dollars on green energy, and all we have seen from that effort is bankruptcies and losses of taxpayer money rather than economic growth. In other words, Obama has no real agenda for a second term on the most important issue facing the country and voters: the economy.

No voter who is concerned about the future wants to pick a president who seems to be out of ideas for growing the economy. Things have been bad for four years, and they are not getting better. The economy is growing more slowly this year than it did last year. Last year, it grew more slowly than the year before. The whole American economy seems to be running out of gas. Something needs to be done to get it moving forward again. Even folks who might not be able to state the problem clearly understand in their gut that something has to be done and it needs to be done soon. Obama, however, is offering nothing but more of the same. That is more of the same policies that have already failed to get the USA growing again. That is more of the same policies that have run up the national debt to unbelievable heights. That is more of the same policies that have left 23 million Americans without jobs and without even the prospect of a job.

There is an old saying that you cannot beat something with nothing. Romney has a reasonable plan. Obama has nothing. Obama is going to lose.

Why Even Bother

There are four polls out today which are meant to tell us the state of the national vote for president. Three of the polls are tracking polls: IBD shows Obama up by 6%, Gallup shows Romney up by 7%, and Rasmussen shows Romney up by 2%. Meanwhile the NBC poll shows the race tied. There is only one possible conclusion that can be drawn from these polls: some or all of them are wrong. Gallup has Romney at his largest lead ever and IBD has Obama tied with his largest lead of the year. One has to wonder why they bother polling.

On another front, two recent political events are also worth mentioning. Yesterday Sandra Fluke spoke to a rally in Reno, Nevada. According to reports, ten people showed up to hear her speak, and the news was unclear whether or not the ten people in attendance included the reporters. Remember she flew to Nevada from Washington DC, just to speak at the rally. One day earlier, there was a rally in the senatorial election in Connecticut that was held in Stamford. Chris Murphy, the Democrat candidate, was joined by Senator Blumenthal of Connecticut, Senator Schumer of New York and Senator Coons of Delaware. These three senators and one candidate drew a crowd of about 50 people. Three sitting senators and the party candidate could only get a crowd of about 13 people per speaker. Again, one has to wonder why these folks bother campaigning.

Romney's Libya Moment

I had to chuckle this morning when I read a supposed "news" article saying that Monday's debate will be Romney's last chance to recover from his "Libya Moment". According to the article, Romney has made two major gaffe's with regard to Libya which will dog his campaign until election day. First, on the day of the attacks, Romney released a statement opposing the actions of the Obamacrats with regard to the youtube video that president Obama said (at least for the first two weeks) caused the attacks. The press and the administration pounced on Romney for criticizing Obama's conduct before the attack was over. Second, at the town hall presidential debate, Romney made charges against Obama about Libya that did not stick. I want to be charitable, but only a total ignoramus or a total propagandist could still claim these as mistakes by Romney. Based upon the normal course of conduct at Yahoo News -- where the article was published -- I assume that the "reporter" was both. Let me explain.

On September 11th, both the embassy in Cairo and the one in Benghazi were attacked. The Cairo embassy knew that the attack was coming, so it sent home most personnel. It also issued a statement apologizing to the Islamic world for the youtube video about the prophet Mohammed. That official statement was criticized by Romney for apologizing for American free speech rather than defending that principle. About an hour or so after Romney's statement, there was a terrorist attack against the Benghazi embassy. Obama had many days of warnings that the attack was possible or even likely. It was, after all, September 11th, and the ambassador in Libya had requested additional security. Obama, however, did nothing to beef up security in Libya. Even when the attack occured, Obama was told about it immediately. His response was not to assemble his security team to discuss a response. His response was to get on Air Force One and to fly off to Las Vegas for some political fund raising. Remember that! Romney was criticized because he responded to the attacks before they were finished. Obama responded to the attacks by going to Las Vegas for a fund raiser. Romney supposedly interfered with the American response to the crisis. Obama, however, made sure that there was no American response to the crisis.

At the debate last week, Obama claimed that on September 12th, he denounced the attack in Libya as a terror attack. That was a blatant lie. Even Candy Crowley who jumped in to defend Obama at the debate now admits that she was wrong. Obama did not say this was a terror attack. Indeed, for two weeks, America was told by Obama, Hilary Clinton, Susan Rice, Jay Carney, and a whole host of other Obamacrats that Benghazi was just a sudden mob reaction to the youtube video. Obama even arranged to have the guy who made the video arrested for "parole violations". The Libyan government called the attack a premeditated attack by al Qaeda. The Obamacrats said it was the video. The military and security forces of the USA told the press this was a terror attack, but the Obamacrats said it was due to the video.

So why is this important? First and foremost, it means that Obama lied to the American people. Even worse, the reason for the lie was an attempt by Obama to cover up his own failure as president. We now have learned that there were requests for additional security in the weeks prior to the attack, but Obama did nothing about them. Obama had just told the country at his convention that al Qaeda was finished, destroyed! How could he up security to protect Americans against such a failed entity? So, for his own political reasons, Obama chose not to increase security in Benghazi. FOUR AMERICANS DIED AS A RESULT!! Were Obama to admit that this was a terror attack, he would have to explain just how it is that no additional security was provided to the embassy despite the ambassador's requests. That is why Obama and his minions kept telling us the lie that this was all due to the youtube video.

Let's be clear: the "Libya Moment" is not Romney's; it is Obama's. The president of the United States ignored his job to protect Americans overseas because doing so would conflict with his political positions. When the worst happened, Obama did nothing but lie to us all in a continuing attempt to cover up his own failures.

I hope this gets fully explored at the debate. If America understands this fully, Obama would be lucky to get 40% of the vote in the election.

Blue Nile Inc. -- Is the Sparkle Gone

Blue Nile Inc. (symbol NILE) is the largest retailer of jewelry on the internet. It has seen explosive growth over the last decade, and some analysts have been touting it for a continued bright future. This seems wrong to me. Indeed, NILE may be reaching the end of its run. Let me explain.

Blue Nile has prospered to date by selling diamond engagement rings; they comprise about two thirds of all sales revenue. In essence, what this means is that men who are buying rings for their prospective brides are making most of the choices. This is key; the customers are men buying jewelry for women. While this may sound sexist, there is a marked difference between the way that men buy women's jewelry and the way that women buy it. Perhaps the best summary is that men buy jewelry on statistics and women want something more. There needs to be a style or a different fashion sense to the jewelry for the women to select it. Let me put it this way: a man could easily walk into a jewelry store and say that he wants a half carat diamond engagement ring; a woman would be much more descriptive.

So why is all this relevant to Blue Nile? Most of the jewelry sold in the USA is chosen by women, not men. Indeed, other than engagement rings, a very small proportion of jewelry sales are selected by men. Blue Nile's site, however, is clearly tailored to men. The Blue Nile site has the look of a wholesale catalogue. It lists styles and gem sizes and shows them in rows of photos that lack any style. Only the product is presented, nothing more. This will never get the attention of most women.

Indeed, there are now companies that have appeared which are filling the void on the internet for jewelry sold to women. One such site is called Adornia. It is a private company, so there is no public data on its sales, but a quick comparison of the Blue Nile site with the Adornia site shows the major difference in approach.

I would be very wary about investing in NILE at this point. It may do well if the economy picks up and jewelry sales in general rise. Nevertheless, without a radical restructuring of its presentation, NILE is unlikely to continue to achieve revenue growth; its segment of the jewelry market is just too small.

DISCLOSURE: I have no interest in Blue Nile and no plans to invest in that company.

Will Pennsylvania be decisive?

Last Spring, pundits discussing the presidential race included Pennsylvania in their lists of battleground states. Then, over the summer, the polls indicated that president Obama had opened a sizeable lead in the Keystone State. Both the Romney and Obama campaigns moved resources out of Pennsylvania to focus on other, more hotly contested places like Florida, Ohio or Virginia. Pennsylvania became a backwater in the presidential race. Now, however, that appears to be changing. Romney has surged in his support in the state. A recent poll by long time state pollster Susquehanna shows Romney in the lead by four percent. Other polls put Obama in the lead but they also show the race getting tighter. Because of the way the campaign has unfolded, this gives Romney an enormous opportunity. Let me explain:

Voters in the swing states have been deluged for months with non-stop campaign commercials. If you live in Ohio, you heard over and over again that Romney is an evil plutocrat who only cares about the rich and who had no problems causing the death of the wife of one of his employees. The full package of negative lies offered by the Obama campaign has been hitting you for months. In addition, you have also been hearing for months from Romney about his plans and also about why Obama has been a total failure for America. Voters in Ohio are way beyond sick of this stuff. In order to make an impact there, the campaigns need something more than TV; Romney's debate victories cut through the clutter, but no thirty second ad could do so. That, however, is not true in Pennsylvania. Sure, there have been some ad buys in the state, but most of the campaign commercials have never been seen by Pennsylvanians. Were Romney to suddenly make a major purchase in the state and to run a barrage of ads, there would be a short burst of unanswered pro-Romney advertising that could change more than a few votes.

Obama has also managed to alienate big chunks of Pennsylvania. In the southwestern part of the state, coal is still an important industry. Obama is shutting this down. In much of the state, natural gas has become the driver of growth, and Obama has been threatening this as well. Sure, Obama has denied these positions during the debates, but the people who have been affected know better at this point. Pennsylvania has also been extremely concerned with economic growth and jobs. With two weeks to go until the election, Obama still has no plan for the next for years on that front. That failure is having a corrosive effect on his support in Pennsylvania.

Right now, the odds still favor an Obama win in the Keystone state. Those odds, however, which used to be something like 6 to 1 in Obama's favor are now down in the range of 3 to 2. If Romney pivots to make a major effort in the Keystone State, we could see those odds move towards 50-50 or even to Romney's favor. And let's be clear: if Romney wins in Pennsylvania, the election is his.

This Time Sure is Different

During the 2008 election, my area of Fairfield County Connecticut was awash in Obama signs. They were on bumper stickers and lawn signs. Some people wore campaign buttons. In short, it was "cool" to show support for Obama. There were one or two McCain signs, but they were something of an oddity. That's not the case this time. there still are some Obama bumper stickers and lawn signs, but I have actually seen more Romney-Ryan signs around town. I doubt that Mitt Romney will carry Connecticut; such a victory would signify a national landslide. Nevertheless, it is going to be much closer here than it has since 1988 when George H. W. Bush (who was born and raised in my town) won the state.

The Foreign Policy Debate

Next week, president Obama and governor Romney will hold their third and final debate of the campaign; the topic, by agreement, is foreign policy. When the Obama campaign agreed to the debate schedule and topics, the Obamacrats must have thought that limiting the last debate to foreign policy would make the encounter a major plus for the president. After all, by all liberal accounts, Obama has been a great foreign policy president. It is the one area where he has positive accomplishments: bin Laden is dead, America is out of Iraq, bin Laden is dead, America is exiting Afghanistan, bin Laden is dead, America's image across the middle east is much improved, and, last but not least, bin Laden is dead. Even ignoring for the moment, the silliness of that view at the time of the agreement (Obama's foreign policy has been a massive failure), events have now taken place that make the upcoming debate a major mine field for Obama. Let me explain:

The discussion of the Obama foreign policy has to begin with Libya and the dishonest policy followed there by Obama and the Obamacrats. It is a strange policy to say the least. The American ambassador and three others were killed in an attack by al Qaeda on our embassy in Benghazi on September 11th and the Obama response was to deny that the attack had taken place. It was clear to anyone who paid attention to the events in Libya that there had been a terror attack, but Obama and the Obamacrats (aided by their allies in the press) decided to tell us all that what happened was a spontaneous response from a mob angry about a youtube video. For two full weeks, Obama and his people kept up the lie even when knowledgeable people like the head of the Libyan government told us that this was a premeditated terror attack. Congressmen and senators who had been briefed on the situation said that it was a terror attack, but we still got the news from Obama that all that happened was a harsh critique of the video.

The reason for the Obama lie about Libya remains incomprehensible. Everyone knows that al Qaeda remains operational. An attack on the anniversary of 9-11 was a tragedy, but it was one that we knew would eventually come. Had Obama reacted differently to the disaster, he could have ended the election campaign in victory. Imagine the country's reaction if on September 11th, as the news came in from Benghazi, Obama had gone on TV to announce the tragedy, told the country that he would not rest until the perpetrators of this terror attack were brought to justice and then cancelled his political schedule for the next two days so that he could focus exclusively on dealing with the crisis. In other words, imagine the reaction if Obama had acted like the president of the United States instead of just another political candidate. The press would have glorified Obama's actions. Romney would have been forced to support Obama or look unpatriotic, and it would have been a major plus for the Obamacrats.

Now, we instead have Obama's lies and more lies coming back to haunt him. Even the other night in the town hall debate, Obama made a phony claim that he told the country on the next day that this was a terror attack. That claim is crap and everyone knows it. The bad thing for Obama, however, is that as this lie unravels, it makes it easier for folks to understand that much of the rest of the Obama foreign policy (and domestic policy) has been based upon lies.

In the last month we have also seen Obama refuse to meet with Israeli prime minister Netanyahu due to scheduling problems. Obama had time for Letterman and the View and the "Pimp with the Limp", but not for the head of government of a key ally who requested a meeting. For four years, Obama has been confrontational and unfriendly towards Israel. Sure, Obama always had a "reason" or "excuse" for his conduct, but the slights towards the Jewish state built up nevertheless. If Obama demanded that Israel keep certain sections of its capital Jerusalem free of Jews (the necessary effect of Obama's demands on so-called settlements), the Obama defenders justified it as part of the peace process. Similar justifications came for the other insults and confrontations. When an Israeli leader asks urgently for a meeting and says, in advance, that he will fly to Washington or any other location chosen by Obama, there is no way to justify Obama's refusal to meet.

The Obama mistreatment of Israel seems finally to be having a real impact. Jewish voters are finally being peeled away from the Obama ticket. In 2008, Obama carried 78% of the Jewish electorate. Two days ago, one poll split Jewish voters this year by 48 to 44%. No one can be sure yet that there has been a thirty percent decline in Obama's share of the Jewish vote, but if the decline is only half that much, it is a major political earthquake.

There are many other areas where the Obama foreign policy has failed: Pakistan, Afghanistan, China, Britain and, of course, Iran come to mind. If Romney can dissect these policy disasters in the same way he recounted the Obama economic failures in the last debate, the foreign policy debate will be Obama's Waterloo.

The Media's Obama Defense

After last night's debate, the media is out today in full force trying to defend president Obama against some of the more telling points made by Mitt Romney. One such example is a piece on the CNN website discussing whether or not the president can really do anything about rising gasoline prices. Remember that last night Romney pointed out that when Obama took office, the average price of gasoline was $1.84 per gallon and now it is more than double that amount. Romney blamed the rise in part on Obama failed energy policies. Obama pointed to increased domestic energy production and claimed that his administration was promoting the production of natural gas and oil. Romney then pointed out that the increase in production was on land where the president could not affect drilling while on federal land where Obama had control, the production levels were down. Obama responded by calling Romney a liar. He also said that prices were low when he took office because the economy was in recession. That is a very short summary of what was said.

The point here is that gasoline prices have soared on Obama's watch; that is something which cannot be disputed. No one could validly blame that price increase on the change in the direction of the economy from 2009 to 2012. Americans are actually using less gasoline now than they did in 2009 despite the improvement of the economy from recession to just stagnation. Obama's point that lack of demand caused the price drop in 2009 was just plain wrong.

Further, it is also beyond dispute that production of oil on land where Obama has some control over production has declined during Obama's time in office. Obama first put on a major moratorium for off shore drilling of all sorts at the time of the BP spill; that cut production by a lot. Then, Obama raised the requirements for drill permits and slowed down the approvals of such permits from an average of six days during the Bush and Clinton administrations to a new average of about 9 months from submission to approval. The result has been a big drop in production on federal and off shore land.

Clearly, the president does not have control of the world oil market; he cannot decree that prices stop going up. But that is not the real question. Obama could have promoted domestic oil production (like he falsely claimed at the debate.) That would have led to American oil production being about half a million barrels per day higher today. That additional production ought to have caused lower prices at the pump across the country. But that is not the only result of such conduct. Half a million barrels of oil per day would no longer have to be imported from abroad. That means that each week about $350 million would have flowed into the US economy rather than being sent to Venezuela or Saudi Arabia or the like. That is something like $20 billion dollars per year injected directly into the American economy with the result that tens of thousands of new jobs would have been created, all as a result of promoting rather than opposing private development of oil resources. Were the Romney plan for promoting energy production to be followed, the impact would be a great many times larger. That means hundreds of thousands of new jobs with all the benefits that flow from those jobs and billions of additional revenue for the government with a resulting reduction in the deficit. In short, promoting oil production ought to be a no brainer. I guess that means that Obama has no brain.

The Upcoming Earnings Report from Armanino Foods

Armanino Foods of Distinction (symbol AMNF on the pink sheets) is a stock that I have written about for years. Today, the stock is up to a 52 week high of 95 cents on heavy volume in anticipation of the third quarter earnings report which should be out in the next few days. Even with today's rise, the stock remains a strong buy.

Last quarter, Armanino earned 2.5 cents per share. Based upon the seasonality of the company's earnings, it is reasonable to expect that the earnings reported for the third quarter will be close to that number. Indeed, if the third quarter surpasses the second by more than ten percent, it will be a strong indicator of accelerating profitability at Armanino. While it may seem foolish to "expect" a good report from the company given the lack of interim reporting, we have the declaration of the special dividend a about a month ago to guide us on that front. The board declared a 1.2 cent special dividend in addition to the regular quarterly dividend of the same amount. The Armanino board is generally conservative and would be unlikely to declare a special dividend unless business conditions indicated that it was fully warranted. Thus, the expectation of good results has a solid basis in the conduct of the company.

If Armanino earns just the same as it did in the second quarter, the earnings for all of 2012 should be in the area of 9 cents per share. Even at 95 cents, the stock is still selling at just ten and a half times this years earnings. Further, 9 cents per share would be an increase of about 27% over the earnings for 2011. A price earnings multiple of ten is too low even for a stodgy, slow growing food company; in that case the multiple ought to be in the area of 13 or 14. For a company growing earnings at 27% per year, a price earnings multiple of ten is ridiculously low. For example, B&G Foods has been growing earnings at about the same rate as Armanino. It has a price earnings multiple in the mid 20's. Obviously, B&G Foods is a bigger company, so there should be something of a discount due to the microcap nature of Armanino. Nevertheless, Armanino ought to carry a multiple of at least 15. With earnings per share of 9 cents, that multiple translates into a stock price of $1.35, a 43% premium over the latest quote.

It is also worth noting that Armanino has already announced that it has locked in its ingredients purchases for the rest of the year. That removes the risk of commodity price spikes and reduces risk in the stock price.

Right now, Armanino is a strong buy ahead of the earnings report. I am revising my eighteen month price target to $1.35.

DISCLOSURE: I am long Armanino stock. It is one of the biggest holdings in the accounts I manage.

A Strange Debate

Tonight's town hall format presidential debate struck me as strange. It was the most confrontational debate that I can recall in any presidential campaign. Plus, after all the discussion prior to the debate about Candy Crowley choosing the questions, some of her choices could only be called weird. With all that, however, I doubt that the debate changed much of anything. Certainly, Obama was not comatose like he was in the first debate; for that he will undoubtedly get credit. Indeed, Obama got the better of Romney in certain questions, while Romney won others. The most important moments for Romney, however, came when he had a chance to summarize the Obama years in a single answer. Romney's indictment of the multiple failures of the Obama years was incredibly strong. When he told the crowd that America does not have to settle for more of the same, it was the strongest point made the entire night by either candidate. Obama did his best to try to come up with achievements for his first term, but they were easily swatted aside by the overwhelmingly poor economic performance that Obama caused. Romney was also extremely strong in explaining the effect of his tax proposals and knocking down some of the lies that Obama and the Obamacrats have been telling about the Romney plan. In my opinion, Obama's strongest moment came in the most unlikely place: the question about Libya. This, however, will prove problematic since Obama lied about what happened the day after the attack. My guess is that in the next debate which is to focus on foreign policy, Romney will have a chance to bring that point home. Nevertheless, Obama was quite good in explaining how much he cares about the diplomats and others who serve America abroad. Of course, he really offered no explanation as to why he quickly ran off to Vegas for a fund raiser rather than dealing with the crisis.

Basically, I could score the debate as a tie or give a narrow victory to either candidate. That result, however, is a victory for Romney. Clearly, Romney will be seen as at least an equal of Obama's. For those who might still be wondering about his competence, the debate helps put such doubts to rest. The question for America remains this: do we want more of the same with Obama? If not, are we willing to trust Romney to try his hand? The nation has already clearly decided against Obama on the first part of the question. Tonight's debate is another big step towards Romney satisfying the second part of the question as well.

Tonight's Town Hall Debate

Tonight brings the second debate between president Obama and governor Romney. This time, the format will be a "town hall" with "undecided" voters (chosen by Gallup) getting to ask questions. At least, that is what America is being told, but it is not true. Let me explain:

According to the polls, there is only a tiny sliver of voters who are undecided; right now the figure is 5% or less. For the most part, these are people who have not been paying attention to the election until recently. That means that tonight's questions are supposedly coming from folks who really do not care to consider political campaigns or issues until just before election day. That means that no one ought to look for any penetrating questions from this group.

But to make matters worse, the questions are not really coming from this group. The supposedly undecided voters attending tonight's debate can only ask a question if that question is first written out and submitted to the debate moderator, Candy Crowley of CNN. It is Crowley who then gets to select which of the questions will be put forward to the candidates. That's right, Crowley gets a few hundred questions and then she picks the dozen or so that get presented to Obama and Romney. To make matters worse, Crowley has also said that she will ask follow up questions as the debate proceeds. In other words, this is a debate where Crowley totally controls the questioning. Aside from appearing on screen to read the questions, the undecided voters have no control at all.

Sadly, Crowley is known to be biased in favor of Obama. That means that we can expect Crowley to try to help Obama as the night proceeds. Don't expect hard questions to the president; he will likely get softballs compared to Romney.

It would be nice if the debates could be more about the candidates and less about the moderator.

Why Do They Bother Polling?

Today brought us a new national poll by the Washington Post/ABC polling effort. According to these gurus, president Obama is ahead of Mitt Romney by 3% among likely voters. This is a 1% increase to the lead Obama held in the last poll by this group which was taken in the days before the first presidential debate. To say the least, this poll seems to be an outlier; most other national polls now show Romney with a small lead. I decided to look more closely at the poll as a result. Here is what I found:

In the pre-debate poll, the Post/ABC got a sample of likely voters that was 33% self-described Democrats and 30% Republicans. This mix of voters may be slightly more Democrat than the electorate in November, but it is close enough to reality to just represent statistical normality. In today's poll, however, the Post/ABC used a sample of 35% self-described Democrats and 26% Republicans. In other words, the Post/ABC shifted the electorate from D+3 to D+9. To say the least, the best word to describe this shift is nonsense. Even in 2008, when Democrats turned out in record numbers and Republicans stayed home, the electorate did not have 9% more Democrats, and one thing is certain, the 2012 electorate will be much more evenly divided between the parties than it was in 2008. Everyone involved with the poll at the Post and ABC well knows this. In other words, the Washington Post and ABC are pumping out poll results that they know are totally flawed. Let me put it this way: if you took the results of any poll and increased the Democrats by 3% while reducing the Republicans by 3%, Obama would get about an extra 6% added to his lead (or closing his deficit). What this means is that with a sample like the one it used two weeks ago, the Post/ABC poll would have resulted in a 3% Romney lead.

These poll results are just another attempt by the liberal media to make it seem that the Romney bounce from the debate is over. It is not, and the media knows this quite well. Sadly, however, the news shows will surely cover this poll with a big splashy story. Americans who pay scant attention to the details will hear how Obama is back in the lead. It is a scam, however, perpetrated by ABC and the Washington Post, and it is clearly an intentional effort on their part.

It is sad that America has to suffer with "journalists" who believe that their job is to shape events rather than to report about them.

Unemployment figures and reality

According to the government, unemployment in the USA has now finally fallen below 8% for the first time in nearly four years. This was reported with the September employment report at the end of the first week in October. I was out of the country when the report came out, so I did not discuss it at the time, but I believe that it merits attention today. Let's look at a few facts:

1) For a great many years, we were told that the economy had to create 200,000 jobs per month in order to keep up with population growth. Anything less than that would lead to a rise in unemployment.

2) About a year ago, the 200,000 per month figure for new jobs was reduced in much of the press to 150,000 new jobs per month. There was no logical reason for that change, except that the number made the monthly reports look better back then.

3) In the last six months, the American economy has slowed. Growth has been well under the rate of 2% per year. This is not a growth rate that creates new jobs. Indeed, according to the Labor Department, in none of the last five months has the economy created the 150,000 jobs needed just to keep up with population growth. That's right, for the last five months, the paltry number of jobs created indicates that the unemployment rate ought to be rising.

4) Somehow, a miracle occured. Even though new jobs were not being created at anything close to the pace needed to reduce unemployment, the rate reported by the government went down, and it went down by a lot. We have seen a drop of 0.4% over just the last two months.

The only rational conclusion one can draw from these facts is that the figures are being manipulated to help the Obama re-election campaign. This is not a statistical fluke. The truth is that this mess is a national disgrace and no one is paying much attention to it. The federal government is supposed to do the people's business, not spend its time trying to get Obama re-elected.

Yeah, That's the Ticket - 2

I wrote earlier today about the lies being told by president Obama and the Obamacrats about the events in Libya where the ambassador and three other Americans were murdered by terrorists. Since then, I have had the chance to see a short interview with Pat Smith, the mother of Sean Smith, one of the slain Americans. On CNN, Smith discusses at how Obama, Biden, Hilary Clinton, Susan Rice and Leon Panetta each promised to tell her the truth about how her son died. Then, they told her nothing. Nearly a months and a half later, she still does not even know how he was killed.

Watch this video. It is remarkably powerful. Here is the link.

Yeah, That's the Ticket

Jon Lovitz used to play a character on Saturday Night Live who was a pathological liar. He would say a lie and then ponder the statement. Then he would say, "yeah, that's the ticket," and follow up with more and more outrageous lies until the story broke down.

I was reminded of the Lovitz character today when I read that the White House now says that president Obama did not know about the requests for added security at the Benghazi embassy where terrorists murdered the American ambassador and three other Americans last month. Indeed, Obama is criticizing Romney for "politicizing" the situation.

All I can say is "What a crock!" Let's look at reality:

1) On September 11th, a group of about 75 armed men stormed the US embassy in Benghazi, Libya. They were armed with rocket propelled grenades, machine guns and mortars, among other weapons. According to witnesses at the site, the attack was sudden; all was quiet moments before the attack began. Within hours, four Americans, including our ambassador to Libya were murdered.

2) President Obama was awakened when the attack began in Benghazi and informed of the situation. He then went back to bed. When he arose a few hours later, he left the White House to attend a fund raiser in Las Vegas.

3) On the day of the attack the White House told America that the attack in Benghazi was the result of a youtube video which supposedly insulted the prophet Mohammed. In the days that followed the attack, the government of Libya announced that the attack had been a premeditated terror attack by an affiliate of al Qaeda. Nevertheless, nearly a week after the attack, Obama sent UN ambassador Susan Rice onto five different television shows to repeat the assertion that "there was no indication whatsoever" that the attack was premeditated or that it involved terrorists. America was told again by Obama that the attack was the result of anger over a youtube video.

4) More than a week after the attack, Obama himself went on The View and told the ladies that he did not know if terror groups were involved but that the matter was being investigated. He also said that the video was to blame once again.

5) Finally, Obama acknowledged what everyone else in the world already knew: the attack was a premeditated terror attack by al Qaeda to mark the 9-11 anniversary. It only took a week and a half for that admission to come out.

So why would Obama spend a week and a half trying to conceal the true nature of the attack? Why didn't he use the attack to rally America to confront the terrorists? The answer is because he was warned ahead of time about the danger of attack and DID NOTHING TO STOP IT! Obama's conduct was so bad that it could even undermine his re-election bid. So, even after admitting that terror groups were involved, Obama continued to change stories.

1) Three weeks ago, we were told by the Obama administration that two days prior to the attack, there had been a meeting in the oval office at which security for American installations during 9-11 had been discussed in detail. We were told that the Benghazi installation was specifically covered. Then all hell broke loose.

2) It leaked out that prior to 9-11, the Benghazi embassy had specifically been told by local sources that there was a danger of attack on 9-11. That report was passed back to Washington and the State Department says that it passed word to the White House. Let's make this clear. OBAMA WAS WARNED PRIOR TO THE ATTACK THAT IT WAS COMING!!!!! So what did Obama do? NOTHING!!!!!

3) So now, Obama is trying to protect himself by blaming the State Department. Like Sargeant Schultz on the old Hogan's Heroes show, Obama's new mantry is "I knew nothing! I saw nothing! I heard nothing!" We are to believe that Obama was not told about the risk in Benghazi and that somehow the State Department failed to pass on the information. As Jon Lovitz would say, "yeah, that's the ticket."

The truth is that Obama was warned about danget to our embassy in Libya and did nothing. As a result four Americans died. That is terrible, but it is not the worst. No, the worst is that rather than accepting responsibility for his failure, Obama is trying to lie his way out of the situation. Obama is blaming the State Department for the mess. But America has already seen Obama spend a week and a half trying to lie about what actually happened in Benghazi. Now he has moved on to lying about what he knew. It is a disgusting mess.

I cannot end without mentioning again that Obama is attacking Romney for politicizing this issue. We have a president who lies to the American people about what happened in Benghazi, then lies about what he was told ahead of time, then falsely blames the State Department for something he knows it did not do, all the while taking no action to bring the perpetrators of the murder to justice. This is a man who is not fit to hold the office of president. But Obama, nevertheless, criticizes Romney for politicizing the issue. I think that this time, the American people will realize that Obama's incompetence is a very important issue in this election and that it has to be discussed.