Faith-Based Investing: Mennonites vs. Muslims

Facts stolen from Newsweek, page 14 in its July 28 issue:

Islamic mutual funds are doing much better than the investments of Mennonite Mutual Aid (MMA). Both kinds of faith-based investment funds attempt to bow to the will of Godalla by avoiding certain types of "sin" stocks, and the differences in concepts of "sin" are leading to equally large differences in profits.

MMA Praxis funds avoid oil companies and weapons makers in an effort to be environmentally friendly and peaceful. MMA therefore lost out on a booming war business and soaring oil prices.

Islamic mutual funds are doing much better, partly because they have completely escaped the subprime mortgage crisis by refusing to invest in financial institutions, in compliance with the religion's strictures against collecting interest on loans.

Meanwhile, a friend of the Freakwenter shares this link to the "Vice Fund," which specializes in making profiting off of evil business. From their website,

The Vice Fund invests in companies, both domestic and foreign, engaged in the
aerospace and defense industries, owners and operators of casinos and gaming facilities, manufacturers of gaming equipment such as slot machines, manufacturers of cigarettes and other tobacco products, and brewers, distillers, vintners and producers of other alcoholic beverages. ... We believe that there are numerous investment opportunities in these sectors which have been largely overlooked by other funds.

But according Newsweek, the Vice Fund isn't doing so well right now.

Neo Spam

My phone rings.

I pick it up and say, "This is [The Freakwenter]."

An automated voice says, "I have an important call for you, but all of our operators are busy at the moment. Please hold briefly."

The music starts playing and I hang up.

The Fringes of Coherence

Why should I put words on something beyond words? I am completely done with using words to deny things that are beyond words, such as "love" (in its most elusive form) or "free will." But still, if I speak of "love" now, I am keenly aware of the weakness of this word as a vessel to carry meaning to a listener, and I don't necessarily consider myself any more "truthful" for using that word than if I had let my actions carry all of the communicable meaning. Of course, one possible meaning associated with the word "love" is an objective promise of devotion, and this in itself makes the word useful, but the subjective meanings are quite another matter. There is that part of love which blows where it will. And now I'm latching on to poetic language! Was that necessary? Have I communicated anything? What is it to me if someone says, "Right on!" and we both nod our heads at the same mystifying statement?

Will we lose all our money?

The short answer is yes, when you die. But will we die in poverty?

Recently a U.S. bank failed. People waited in very long lines to get their cash out, and people with more than $100,000 might have lost all the rest of their money. Read about it here.

What does it mean for a bank to fail? A bank fails when a depositor tries to withdraw funds and finds that no funds are there to be withdrawn. This can happen because banks lend out much of the money the depositors deposit. If too many depositors try to take their money out at once, the money that the bank did not lend runs out before the borrowers pay back their loans to the bank.

Banks were failing a lot during the Great Depression. This inspired congress to create the Federal Deposit Insurance Corporation (FDIC). Nowadays, any bank that is not a member of the Federal Reserve System must pay insurance premiums to the FDIC so that the FDIC will protect the bank's customers from losing up to $100,000 in the event of a failure.

But what if a modern-day wave of severe bank failures causes the FDIC to run out of funds? Who insures the insurer? Since the FDIC is a federal (but somehow corporate) entity, it would, in the opinion of the Freakwenter, draw funds out of the US Treasury, running up the national debt.

Mankiw for President

The Freakwenter today announces his endorsement of N. Gregory Mankiw for president (or at least vice president). Obama might be a smart cookie, but Mankiw is an economist. No more wars without careful cost-benefit analysis. No more agricultural subsidies. No more fuel subsidies. More free trade, and international cooperation. More educated foreigners allowed into the US. More smart economic policies to increase opportunities for everyone.

His blog.

His platform.

Customer Citizen

Should the government of Washington D.C. view its residents as citizens or as customers? Or as customer citizens?

Now that I'm trying to register my car in DC, the DC department of motor vehicles seems to think that I am a customer. Their website for vehicle registration states the following advisory (emphasis added):

The best times to visit the [inspection] station are Tuesday, Wednesday or Thursday afternoons from 3 pm - 6 pm. Customers are advised that the days before and after a holiday and most Saturdays are especially busy due to many customers being off from work.

The Cost of a Ride

As a car owner and frequent giver-of-rides, I'm often asked, "How much do I owe you for gas?" Typically my response, as implied by the question, has been to estimate the number of miles divided by the mpg times the price of gas divided by the number of passengers.

Of course, if I'm transporting friends or family (especially for short distances), it often makes sense to not exchange any money, in the spirit of communal living. But "How much do I owe you for gas" is not the appropriate question for a rider to ask if they are truly attempting to split costs fairly.

Let's start with some numbers. My car cost me $3,000 two years ago, and since then I've paid about $2,000 for major repairs and regular maintenance. My annual minimum liability insurance costs are only about $500, thanks to my perfect driving record. Optimistically assuming that my car runs four more years and then sells for $1,000, and assuming annual maintenance costs of $1,000, the annual cost of owning my car is about $1,830.

Since I drive about 9,000 miles per year, the ownership-cost per mile is about 20 cents. In comparison, the gas-cost per mile is less than 12 cents (assuming $4/gallon gas and 35 mpg). Therefore, the rider who pays only for their share of gas is covering only about 37% of the total cost of the ride.

In case you hadn't noticed, the above analysis is crappy. Considerate these additional considerations:

• Suppose a rider is merely tagging along on a trip that I have decided to make regardless of whether there are passengers? Then why should the rider pay more than enough to cover the decrease in gas mileage resulting from the weight of their body in the car?
• The benefit derived from owning a car is not merely a function of how many miles one travels in it. Just having a car in my driveway that I am free to use on a whim for various low-mileage trips is a benefit that my riders don't enjoy.
• Since cars wear out just as much from age as from miles driven, I could greatly decrease my ownership-cost per mile by driving more miles per year. It doesn't make sense that the amount my passengers pay should especially depend on how much I drive when they are not riding with me.
  

In conclusion, I don't think that riders should have to pay three times the price of gas, but it would probably be appropriate to throw in at least a few extra dollars to help with just a small portion of the ownership costs. And if a rider outright borrows a car from an owner, they should offer to pay at least twice the cost of gas.

Will you sign this birthday card?

Today somebody stopped by my work-hut and handed me a little brown paper bag. It did not contain a lemon. The bag contained a birthday card. The birthday card was for a coworker. Lots of people had signed the card, and I was asked to do the same.

Every time this happens to me I get a big lump in my liver. How will I ever think of something to write on this silly little card that can ever make up for the complete lack of interest and concern I have for this colleague? Or, if I do happen to care about this colleague, how will I ever think of something to write that can communicate this without being silly or sappy?

Some people write "Happy Birthday," or "I hope you can run again soon [after some horrible accident]," or "It's been great working with you." Blah, Blah, Blah.

I usually just write, "Way to go!"