Over the Top

“You Americans tend to go overboard at Christmas…” -Anonymous

Each year, just before Christmas bonuses are handed out, we draw together our employees in Baltimore for a company meeting. Your editor gives a little speech, trying to sound much more like Fezziwig than Scrooge. Here, we share extracts of it with you, dear reader:

“The purpose of this little address is merely to remind ourselves what business we are in and to take a moment to appreciate all those people who have worked hard over the last 12 months not to blow it up. We are not a publicly traded company, so we cannot rely on the naivete of stock buyers…nor the connivance of Wall Street for our daily bread. Instead, every slice must come from customers. It is them we thank for every slice of whole wheat or rye…every bit of fruitcake we eat during this Christmas season…and every glass of punch we drink at tonight’s Christmas party.

Agora Publishing: Rock and Roll

“Thanks to our customers [that’s you, dear reader] we are able to buy Ravens’ tickets…make our mortgage payments…and send our children to school with shoes on their feet, probably in that order. And because customers have been so ready to open their purses, we’re able to rock and roll tonight down at the Belvedere Hotel tonight…rather than at, say, St. Aphonso’s church hall.

“So let us first take a moment to think of the people who pay our salaries and bar tabs…let us wish them all a happy holiday along with all the joys this wonderful old world offers.

“And now, we turn back to us …to our company…and what we have wrought.

“First, we must clear up a misunderstanding. We heard a rumor the other day that our company had made an extraordinary amount of money this year. Fifty million dollars was the number we heard. It recalls the story of the Texas oil man who made $1 million from a single well in outside of Dallas. The man in question heard the story and turned to his friend:

“‘Well,’ he said, ‘it wasn’t really an oil well…it was natural gas. And it wasn’t really outside of Dallas; it was outside of Houston. And it wasn’t really a million dollars; it was two million. And it wasn’t really me; it was my brother. And he didn’t really make it; he lost it.’

“When we heard how much money we were alleged to have made, we were shocked. ‘I hope my wife doesn’t find out about this,’ I said to someone in the accounting department. ‘Don’t worry,’ he said, ‘she already thinks you make more than that.’

Agora Publishing: Twisted in the Retelling

“Stories tend to get a little exaggerated and twisted in the retelling.

“But we have had a very good year. We made money; probably more than we deserved. But there is a time and a season for everything. For many, many years we made less than we thought we deserved. Everything tends to balance out in the long run.

“Our publishing business is very healthy financially. We began business 26 years ago. And we never borrowed a dime from anyone. This was not because we were especially smart or especially prudent; it was just because there was never a lender around who was dumb enough to lend us money. Nor did we ever really take much profit out of the business. Again, this is not so much a mark of virtue as of incompetence; for many, many years we never made any profit. So, not taking it out was fairly easy…and became a habit. Even now, when we are profitable…we distribute very little money to shareholders. Instead, it is reinvested in the business.

“So, today, we find ourselves debt free…well…almost.

“You see, we’re in the publishing business. And there’s a peculiar feature of the tax code that allows publishers to push forward their tax liability – as long as they’re expanding. This made it possible for us to operate for nearly a quarter of a century without paying tax on profits. But eventually it catches up with you. We knew it would. So we’ve been putting aside some money each year. And thanks to this year’s profitability, we’ve finally been able to put away enough money so that we can settle up with the IRS. So despite what you hear about us making record amounts of money – which is true – if we were to close our doors tomorrow, we would still barely have enough money to pay off the government. So you see, dear reader, making money is not nearly as easy as people think.

“But people love to exaggerate. And no one loves hyperbole more than we do…here at the Daily Reckoning. In fact, people often criticize us for saying things that are `over the top.’ Kiplinger magazine, for example, accuses us of overdoing it in the current issue. ‘Hyperbole made easy,’ is the title. Above the title is the date: January 2005. We don’t know, but the last time we looked, it was still December of 2004. Kiplinger didn’t seem to notice that it, too, stretches the boring truth – clear into the next calendar year! Nothing wrong with that, as far as we’re concerned. Hyperbole is what distinguishes America from other countries; it is what makes us what we are. Everything about the place is oversized. The cars, the houses, the people…and the country itself. Practically every movie, every shopping mall, every great American novel, every popular song…even the wide open spaces are a form or hyperbole. Look at what drives down the streets. Is not the Hummer a superb example of exaggeration? Look at Pamela Anderson!

Agora Publishing: Overstatement, Exaggeration, Hyperbole

“Americans love hyperbole. British humor may be based on understatement. But American humor is based on over-statement….exaggeration…hyperbole. ‘My wife was so fat she got stuck in the Holland Tunnel’…or…’He was so short he had to stand on tippy-toes to kiss a duck’s derriere.’

“But Americans, of course, are no greater fools than anyone else. They like hyperbole because it provides insights that would be lost in the dull details of daily life. Amid the constant background noise of TV news and cocktail chatter, the boom of hyperbole wakes us up…and brings to life the nuances…the curiosities…and the absurdities of the world we live in.

‘Words must be a little wild,’ said the great economist John Maynard Keynes, ‘for they are the assault of thoughts on the unthinking.’

“At the Daily Reckoning we take aim at the unthinking every day. We can’t help but notice that much of what passes for conventional, reasonable and moderate – the kind of things you would find in a Kiplinger headline, for example – is really even more absurd than the `over the top’ palaver of its critics. What’s more, the hyperboles do not get you into trouble, it’s the exaggerations and absurdities that you don’t even notice.

“The man on the street – the prototypical Kiplinger reader – believes he can make money by just buying stocks `for the long haul.’ He thinks his house will make him rich. That he can `get something for nothing’ is not merely an idea – but the basis of his retirement program! A falling dollar? Don’t worry about it! Record deficits? They’ll work themselves out somehow. Yet, none of these preposterous ideas is thought to be `over the top.’

Agora Publishing: Over the Top

“The expression `over the top’ was used in WWI. Then, it was considered perfectly reasonable – indeed, it was the conventional wisdom – that a man would leave his trench, going `over the top’, and walk across open ground while other men tried to kill him, usually successfully. No one knew exactly what the point of it was…but at the time, almost everyone agreed; it was the thing to do. Kiplinger might have put it on a cover: `Get Your Butt Shot to Hell in No Man’s Land’… and considered it very reasonable, moderate and responsible journalism.

“The trouble is, you cannot always tell what’s `over the top’ and what’s not – until you’re lying dead.

“Years ago, we took up the issue in London. We went to visit the financial regulators in that city – England’s equivalent of our SEC. They had a rule against used hyperbole or fear in financial advertising. We wanted to find out what they meant by it.

“So we posed the question:

“‘What if we wrote a prediction: The world will soon enter its worst war ever. Twenty million people will die. Almost all the major governments of Europe will fall. Our country will be bankrupted. Our currency will be ruined…

“‘What if we wrote that in 1913?’ we continued.

“The regulator squirmed in his chair. He did not know what to say. He was a smart man. He knew that it would have been almost impossible to exaggerate the horror of what was to come in 1914. No `fear’ tapped out on a mangy journalist’s typewriter could come close to the real fear that was soon to be felt by the millions of young British men who would have to go `over the top’ into the maul of modern war. And no sorrow conjured up by a gifted imagination could match the real grief of millions of keening widows and orphans. Hyperbole and fear are not fixed stars upon which a man can steer…but inconstant moons, that wax and wan according to the circumstances.

“That is the trouble with hyperbole, dear reader, it is never reaches the scale of real life. And that is the trouble with real life, it refuses to confine itself to our hyperboles.

“But it is Christmas. It is time to go overboard again. And enjoy it.”


Bill Bonner
Poitou, France
December 24, 2004


Poor Ebenezer.

The old fellow looked back on his youth last night, as Maria read a new chapter of A Christmas Carol. What Scrooge saw discomfited him.

His fianc’ rejected him. He had found a new love, she said – wealth. It’s either her or I, the young woman seemed to imply. But Scrooge had already made his choice. He chose the “golden idol.”

Of course, times have changed. Today’s Scrooges embrace a paper idol. Ah yes…there’s the fun in it. At least gold represents real wealth. For all his penny-pinching miserliness, at least Scrooge was saving real money.

Now, people bow down before a phony kind of wealth – the kind you don’t even have to scrimp and save to get! Who shivers in the wintertime in order to lay up his economies in gold coins? Who sweats in summer just to buy a few more kruggerands?

No, today’s Scrooges are of a different ilk all together. They drive fancy cars…live in oversized houses…and save nothing. They worship at a strange new altar – an altar of things…things measured in paper dollars. For only 400 paper dollars per month you can drive around in a big, beautiful new car. You won’t quite `own’ it…but you can enjoy it anyway. For 2,000 paper dollars per month you can live in a bright new house with all the conveniences. It won’t really be “your” house…but you will be the one living in it. For a few paper dollars more…you can spend your fool head off, buying more things made in Asia. This season’s hot items, we are told, are iPods and DVD players. Who needs them? Who can afford them? Who cares?! The poor stretch to buy worthless geegaws and monster burgers. The middle class mortgages itself up…works night and day…runs from pillar to post…just to keep the paper dollars flowing. And the rich? They cannot wait to get rid of their money…and industries are springing up to help them. Hotels have invented new “concierge” services – at $1,000 per night, and up. Mercedes has a waiting list for its Maybach. Houses sell for $1 million, $3 million…$5 million. There seems to be no limit. In New York City, an apartment sold for $44 million. In London, someone paid $104 million for a Picasso. A Mondrian fetched $21 million.

We recognize the bony, grasping, avaricious hand of Scrooge. We’ve seen it on TV! We have all decided not to make that mistake. We will not scrimp on candles! We will not hoard gold – not while Tiny Tim needs a new crutch.

But this soft, new hand…reaching for what it cannot really afford…clutching THINGS of great price and little value…we do not know what to make of it. And lo…it is attached to our own bodies!

More news, if there is any…
Bill Bonner, with more views, from the deep heart of France…

*** Ooooh…what’s this? House sales took their biggest drop in many years. November statistics also show the media price fell from $224,000 to $206,000. A fluke? Or a trend? We will wait to find out.
Markets are closed today. But here at the Daily Reckoning headquarters in Poitou, we are on the job…as usual. And why not? To us, the markets are merely another Public Spectacle…more interesting and exciting than a football game…more serious than an election…more facetious than a lynching. Why not keep our eyes open?

But there’s not much news today. Stocks rose again yesterday. Buyers are enjoying what we believe will turn out to be a “catastrophic success.” But heck…we’ll wait to find out for sure, just like everyone else.

*** Our gardener, Damien, appeared at the kitchen door yesterday afternoon.

Damien is a loveable character. He was an orphan. Now, at the age of 44, he still looks like a lad fetched up at a Catholic home for boys. He stood at the door in his overalls, with bloody apron about his waist, to which a few feathers seem to have been glued on. On his head was a hat with flaps sticking out on both sides like Little Bear from children’s stories. A wide grin on his face. A sparkle in his eyes. And in his hands was a large, dead turkey.

“I took off all the feathers,” he announced to the women in the kitchen. “Do you want me to leave the head on?”

The bloody head drooped practically to the ground. Our Christmas lunch did not look appealing.

“Yes, let’s leave the head on,” said Danielle, a part-time housekeeper. “It adds flavor.”

“Yecch,” said Maria.

“What are you doing for Christmas?” Maria asked of Damien.

“Nothing special…”

“I mean, are you spending it with your family?”

“I don’t have any family…”

“You’re not going over to a friend’s house…?”


“You mean, you’re spending Christmas alone?”

“Yes, but I’m used to it…I’ve been doing it for 40 years…”

Maria was visibly shocked. But she didn’t know what to say. She is one of six children…and could not imagine a Christmas not surrounded by family…let alone a Christmas spent all alone.

“Then you must come over here…” she said.

“Okay…I’ll bring something to drink.”

This morning, a whole case of liquor appeared on the kitchen table.

*** Carl Waynberg, the man Addison Wiggin says is “destined to be one of the most cutting-edge stock pickers in the investment world,” has let us in on something huge: the secret stock exchange…

In this overlooked segment of the stock market, Mr. Waynberg keeps his eyes peeled for “jumpers,” or unknown, but hyper-profitable, small-cap securities that are destined for a transition to major stock exchange. Last year, 15 of Carl’s picks jumped from obscurity to big exchanges…and these are quality, long-term holds. [For details on an 80% discount on charter memberships to THE GRIP…

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