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Highlights—March 1, 2008

• New York Times: I.B.M. Plans $15 Billion Share Buyback. Excerpts: I.B.M. said on Tuesday that its board had authorized a $15 billion share buyback program that could increase 2008 earnings by up to 5 cents a share, sending its stock up 4.2 percent. News of the planned repurchase, equivalent to about 10 percent of the market capitalization of I.B.M., pushed the stock market higher. The company’s shares rose $4.30, to $114.38.
• Yahoo! IBM Pension and Retirement Issues message board: "IBMs $15 Billion stock buyback" by "ranheimchas". Full excerpt: It is almost difficult to believe that IBM has the cash reserves to spend another $15 Billion on stock buybacks while increasing the medical costs for retirees with no relief in sight. That is just another slap in the face for all of us who gave so many years of our life helping to make IBM the good company that it used to be. How things have changed. We were once included in the large pool of employees to help keep our medical costs down. Now, being in a much smaller high risk pool certainly drives our medical expenses out of reach for many retirees. As I have said before, I am not angry over how IBM treats us now, but I certainly am hurt to think that a company we all respected would treat us this way in our final years.
• Yahoo! IBM Retiree Information Exchange message board: "Re: COLA?" by "i_be_mad_as_heck". Full excerpt: I have to respectfully disagree that there is nothing retirees can do. If thousands of retirees show up at the Annual Shareholders Meeting and make their feelings known to management and the shareholders, I believe COLAS will get some attention. But I don't hold out much hope of a large number of retirees showing up at the ASM. In general, retirees are a pretty docile group and still have blind hope that the company will do the right thing.
• Yahoo IBM Retiree Information Exchange message board: "Re: COLA?" by "ignatz713". Full excerpt: Un huh. You mean before or after the microphones go dead on those with the important, rather than planted, questions?
• Yahoo! IBM Pension and Retirement Issues message board: "Re: IBMs $15 Billion stock buyback" by "jonatha1". Full excerpt: If you look at IBM's balance sheet from its quarterly reports, you will often see stockholders' equity go down even though the company has reported positive net income. Given the complexity of IBM's operations, there are probably many ways this could happen. However, one of the simplest explanations is that they're spending more money than they make in order to buy back stock. At some point that will no longer be a viable strategy...
• Yahoo! IBM Employee Issues message board: "$30 Billion dollars in IBM Stock Buybacks 2007 and 2008" by "ibmmike2006". Full excerpt: The business climate of the market in 2007 and presently has not been Up. So how has IBM found all this money to buy back $15 Billion in 2007 and another $15 Billion in 2008? I guess the credit of the IBM company is pretty good.

  But, maybe there is another reason. With the stock price up from the 70's last year to $114 today. The shareholders? The Executives? Institutions investing in IBM for IRA, 401K, 403B, 457 accounts? Well all the above.

  The Executives stand out as benefiting the most with Stock Options that are expiring June 30, 2008 awarded June 30, 1998. As they say, "Greed is good". So there might be a "sell off bubble" before June 30, 2008. You will not see the individual sell of Louis V Gerstner Jr of his 20,000,000 shares as he is no longer a VP or director. His strike price along with the other 34 Stock Option award receivers is about $53 so if the price, at the time of sale is $114 as of today, Gerstner will glean $61 a share times 20,000,000 or $1,220,000,000 in his bank account.

  After giving this chart to a reporter at the IBM stockholder meeting a few years ago, the information disappeared from the cbsmarketwatch.com website. You can probably find these stock option awards in the archive filings at the SEC however.

  In the following chart, I visited www.cbsmarketwatch.com and looked at each person listed that received stock Options on June 30,1998. The day Gerstner negotiated his outrageous contract and stock options. So these assumptions are made, we know that these folks sold shares, but lets assume, they did not, are good employees like me, and held their shares and are going to cash them in today. All of them. Now when they do, we will assume, that all the money is taken out of the company, at the present share price of $114, Feb 27, 2008.

  The Options, June 30, 1998 were issued with an exercise price of $106, there was a split in June 1999 of 2 for 1 share, the amount of stock would double and the exercise price would halve to $53 a share. But, did you know, that Gerstner had the power to change the exercise price from what the shareholders approved in 1998? The $53 stock option can be turned in, Lou mentions this on page 99 of his "Elephant" book as distasteful. You can see this as Lou bought a lot of shares at $13 and so did many of these "35 people" and turned around and sold the same $13 share the next day for $115.

  Stock Options Awarded June 30, 1998 to "35" People:

  Name	Title	Stock Options Awarded in 1998	Stock Options Following June, 1999 2 for 1 Split	Value of Stock if Sold on Feb 27, 2008
  Abuzayyad, Ray	VP	80,165	160,330	$18,277,620
  Akers, John	VP	44,177	88,708	$10,112,712
  Armstrong, John	VP	8,863	17,726	$1,952,364
  Attadaro, Michael	VP	110,025	220,050	$25,085,700
  Beitzel, George (affiliated)	VP	2,132	4,264	$486,096
  Burke, James	VP	150,515	301,030	$34,317,420
  Cannavino, James	VP	7,685	15,370	$1,752,180
  Conti, Carl	VP	11,923	23,846	$2,677,404
  Donofrio, Nicholas	Officer	92,755	185,510	$21,148,140
  Evangelista, Donald	VP	17,094	34,188	$3,897,432
  Forese, James	VP	16,966	33,932	$3,868,248
  Gerstner, Louis V	COB	10,713,960	21,427,920	$2,442,782,800
  Hancok, Ellen	VP	8,586.	17,172	$1,957,608
  Kalis, David	Officer	320,000	640,000	$72,960,000
  Katzenbach, Nick	Director	50,733	101,466	$11,567,124
  Kavetas, Harry	VP	60,049	120,098	$13,691,172
  Kuehler, Jack	President	34,612	69,224	$7,891,536
  LaBant, Robert	VP	3,706	7,412	$844,968
  Lautenbach, Ned	VP	8,249	16,498	$1,880,772
  Libero, Robel	VP	112,562	225,124	$2,864,136
  Low, Paul	VP	32,431	64,862	$7,394,268
  Metz, Frank	Officer, Director	14,753	29,506	$3,363,684
  Michael, Armstrong	VP	17,494	34,988	$3,988,632
  Opel, John	Director	120,920	241,840	$27,569,760
  Pucket, M	VP	9,859	19,718	$2,247,852
  Ricciardi, Lawrence	Officer	2,003,089	4,006,178	$456,684,000
  Ripp, Robert	Officer	8,200	16,400	$1,869,600
  Riverso, Renato	VP	108,982	217,964	$24,847,896
  Schwartz, Stephen	VP	26,318	52,636	$6,000,504
  Thompson, John M	Officer, Director	80,213	160,426	$18,288,564
  Vanderslice, James	Officer	74,007	148,014	$16,873,596
  Vanvranken, Michael	Officer	3,318	6,636	$756,504
  Wheeler, Earl	VP	11,675	23,350	$2,661,900
  Zuckerman, Fred	Shareholder	400,000	800,000	$91,200,000
  Totals		14,981,737	29,963,474	$3,415,782,000

  Three Billion, four-hundred fifteen million, seven hundred eighty two thousand, dollars divided up somewhat unevenly for "35" people, granted on June 30, 1998 and if sold at a share price for $114, June 30, 2008, in this example. No matter how you cut it, it is $3.4 Billion that is available to be removed from IBM assets and put in the bank accounts of "35" people.

• Yahoo! IBM Employee Issues message board: "Re: $30 Billion dollars in IBM Stock Buybacks 2007 and 2008" by "Dwight Siebert". Full excerpt: It is certainly not your father's IBM. To quote Tom Watson Jr:

  I considered taking even more radical steps to increase IBM's commitment to its employees. Those at the top were doing fantastically well on stock options-despite the fact that Williams (Al Williams, then IBM President) and I stopped taking options in 1958, after Williams said, "We don't want to look like pigs." While IBM's workers were making good money, they couldn't look forward to the rich capital gains that executives with options had. I asked myself, "How much more am I worth to IBM than that guy down at the bottom of the pay scale? Twice as much? Sure. Ten times as much? Maybe. Twenty times as much? Probably not."

  Pg 311, Father, Son & Co.: My Life at IBM and Beyond, by Thomas J. Watson Jr.

  These folks are way beyond pigs...

• Yahoo! IBM Pension and Retirement Issues message board: "Re: $30 Billion dollars in IBM Stock Buybacks 2007 and 2008" by "mr_quarkwrench". Full excerpt: It is nice to see that it ONLY costs $30 Billion to manipulate the market so 35 people can make $3.4 Billion. They aren't greedy, they are only taking about 11%. If IBM had spent the $30 Billion on research, raises, stock dividends, COLAs for retirees or employee/retire medical care these hard working execs would have gotten nothing. That wouldn't be fair. -- Don
• Yahoo! IBM Pension and Retirement Issues message board: "Re: $30 Billion dollars in IBM Stock Buybacks 2007 and 2008" by "alwaysontheroad4bigblue". Full excerpt: Ah yes. Meanwhile, it was emphasized on a phone call I was on today that spending for education, supplies, software, and so on is still frozen (as it has been for as long as I can remember.) IBM can afford $30 billion for a stock buyback, but won't buy pencils and Big Chief tablets for its employees.
• Yahoo! IBM Pension and Retirement Issues message board: "Question for the Board" by "ibmsr2d2". Full excerpt: I've been lurking for almost a decade. This is a great blog/group. This will be my first post. My question is pretty simple, yet quite complex.

  I've been a good performing employee in the company for almost 34 years. Mostly 1's and 2's.

  In the last year, however, I have lost faith in IBM and it's management. They have also lost faith in me as well. For the first time their business models don't make sense to me as well as to many of my colleagues. I realize it's time to go and believe me, I hope the best for those still working in the company but I think it'll be a problem to work there at least in the United States.

  In any case, I am very lucky and can retire, so I am planning to advise my management that I will retire on June 30. This is almost 120 days away.

  So the question is: If I call up the ESC, and give them the date and I hear it is then "cast in concrete", will I be able to move it up in the event of a major change in the retirement plan? Although the chances are remote, there could be for example a pension change announced let's say on April 1 just after I agreed to retire "cast in concrete" on June 30. Frankly, I don't trust (never have) the management of this company.

  Is there ERISA protection for those who decide to formally have a date to retire beyond the normal 90 days or should I just wait until March 30? I know this is a small deal compared to what many thousands have suffered here in the last decade.

  I also plan not to sign anything as I go out the door, no HR sponsored "remembrance book", etc. I have 2 patents and a half dozen more in application status, but I don't agree with their new confidentiality agreement "reminder". I'll just leave my badge and AMEX card on someone's desk and go quietly out the door to a new career, whatever it may be. Scary, but it's can't be worse than staying inside this mess that some called the "blue pig"!

• Yahoo! IBM Pension and Retirement Issues message board: "Re: Question for the Board" by "madinpok". Full excerpt: If you are within 6 months of your planned retirement date, then it is a good time to call the ESC. When you give them a date, it is not binding. They will simply send you a retirement estimate, similar to what you get from the online pension estimator. If you decide to act on it, then you call them back and tell them which options you would like to choose (such as single life annuity, joint and survivor, etc) and then proceed to the next step, which is sending you the formal paperwork to sign. This paperwork has to do with committing to the payment options for your pension, and has nothing to do with resigning from IBM. Until you sign and return it, you can still change your mind on the date, or call the whole thing off. It will take about 1-2 months from when you return this paperwork until you receive your first payment.

  In parallel with this, your manager has to work with HR on your exit paperwork (i.e. your resignation from IBM).

  If IBM should announce something in the next few months, you can always change your retirement date. ERISA protects your vested benefits, so there is little reason to think that something would happen between now and June 30 that would force you to rush out the door. You are already retirement-eligible, your pension is already frozen and you aren't earning anything more, and IBM can't take away what you have already earned.

  One thing to think about as far as the date goes... if you retire on June 30, I don't believe you will receive any variable pay for 2008. But if you retire on July 31, you will receive a pro-rated amount. It's your choice as to whether you think it is worth it to hang around for an extra month.

  Be sure to use your floating holidays before you use any vacation days. And keep track of how many earned-but-unused vacation days you still have as of your retirement date, as IBM will pay you for those.

• Yahoo! IBM Pension and Retirement Issues message board: "Re: Question for the Board" by "thekanck". Full excerpt: I'll just make one comment.... I see no advantage to you in announcing your retirement so far in advance.... It might allow mgmt to take advantage of you somehow and offers no distinct benefits to you as far as I can see...... If I were you I would not give more than the standard 2 weeks notice to mgmt. Calling the ESC is fine and a good planning exercise, but I see no advantage to making an official announcement any more than 2 weeks in advance.
• Yahoo! IBM Pension and Retirement Issues message board: "Re: Question for the Board" by "About Hadit". Full excerpt: One thing they might do is to reclassify you to a lower band and/or cut your pay by 15%. That would allow IBM to cash out your vacation days based on the lower pay scale. It's things like that which is why you should not give more than 2 weeks notice. When I sent for my retirement package, management was never notified. Then they started a resource action and paid me a bunch to leave. Anything can happen between the time you call for your package and the time you quit. Just remember, if it's good for you, IBM won't do it.
• Yahoo! IBM Pension and Retirement Issues message board: "Re: Question for the Board" by "madinpok". Full excerpt: You are correct - IBM has frozen contributions to the pension plan. However, as you point out, both your monthly benefit and the lump sum can change. There are several things that cause these changes. Your retirement benefit is based on an age-65 pension value. That is the thing that is protected by ERISA. Everything else is derived from that value.

  As you age, the conversion factor that is used to calculate your monthly pension benefit decreases, causing your pension amount to increase slightly for each additional month you postpone starting your pension.

  The lump sum works differently. The lump sum is based on the age-65 value of your pension in 1999, when the cash balance plan was implemented. To calculate the lump sum value, a long term interest rate is used. This used to be the rate on 30-year bonds, but when the Pension Protection Act was signed into law in 2006, it allowed companies to switch to using an interest rate based on high quality corporate bonds, which is generally higher than the 30-year bond rate. This causes the value of the lump sum to decrease. The phase over to the corporate bond rate is being implemented gradually from 2008 to 2012, and you can expect the lump sum value to decrease over that time.

  In addition, the pension protection act also switches to new mortality tables, which also have an effect on the lump sums. Note that the change in interest rates and mortality tables does NOT change your monthly annuity amount. They only affect the lump sum amount.

  Here is a recent article on this: http://www.kiplinger.com/magazine/archives/2008/03/lump-sum-payout-vs-distribution.html

  It is my understanding that IBM has been updating the interest rates only once per year, at the end of the year. I'm not sure if this has changed or not, but it might be that it has. Finally, as has been mentioned before, the lump sum is often a poor deal for employees who are not close to age 65 and have a normal life expectancy, as it gives up the early retirement subsidy which can be quite valuable.

• Yahoo! IBM Pension and Retirement Issues message board: "Re: Question for the Board" by "m_l_benefit_seeker". Excerpts: Take all of your holidays first, before vacation, not just your floating holidays. Holidays are given to you as of the first of the year, not accrued as vacation is. I'm retiring next Friday, 2/29/2008, and I've used all 12 of my holidays, and will be paid for 2/12 of my vacation.

  Also, it may be to your benefit if your salary is cut 15% before you leave. The summary plan description indicates that if your salary is cut more than 10%, you are eligible for a severance package.

  In addition, you are not required to give advance notice of your retirement, it is done as a courtesy to IBM for planning. At least 45 days has to elapse before a 1st day of a month for you to receive your pension, although you will receive retroactive pay. As an example, I told HR on January 15th that I'm retiring on 2/29, but I will not be paid until April 1, not my first retirement day on March 1st. I will receive retroactive pay for March on April 1st, in addition to my April payment, because they want the signed paperwork with your payment choices at least 45 days before your first check. Good luck with your decision.

• Yahoo! IBM Pension and Retirement Issues message board: "Re: Question for the Board - Thanks" by "ibmsr2d2". Full excerpt: First of all, thanks to all of you on this board that volunteered the many valuable responses to my query. It's a hell of a legacy for a company and its leadership that after 33 years of service in IBM I trust the well meaning anonymous responders on this blog more than any managers in the company and certainly anyone of the crew of IBM HR.

  After 33 years of 1 and 2 appraisals and doing what I thought was the right thing, I was not very surprised to get my first "3" in 33 years but I was surprised to be threatened with getting managed out of the business. In the past, I'd search out another job and transform myself once again, but the "new IBM" is not about creating employees with great broad expertise, it's about using up people in a narrow job and getting rid of them once they get tired, sick, obsolete or irrelevant. You can't grow technically or intellectually here anymore. It's also about adulation of management, much like hollywood stars and politics. These guys really think they are infallible gods as they reach the VP levels.

  During last year, another division requested my well publicized and very specialized expertise in a particular industry and set of technologies. When asked to help, I immediately did so (with management approval) went out of my territory and closed some more business for them. In 2008 they asked for more help and when my management refused they just escalated and blew them away. It turns out they now hold that against me. At least I'll get canned for doing the right thing! One colleague said "You are committing career suicide. Go ahead and enjoy it, you have nothing to worry and you'll do better outside of IBM!" I've agreed to work as a subcontractor for the other division if I get canned out of IBM.

  Interesting point on the 15% cut triggering a severance package. Although I'm not involved (I was an IT Networking Architect for at least 10 years in IGS and now an SSL in IGS GTS sales) I've passed this tidbit to some of my old delivery friends and at least one has acted on that tip.

  I've disclosed my decision to a couple of friends and have been pleasantly shocked at their reactions. More than one suggested that I just sit on my ass and encourage management to give me the "3" package of 13 weeks pay and CORBA which will save me money over the FHA theft victim rates for a year. One potential new employer and friend even said "Go for it! Let them fire you! It doesn't hurt a bit - it may even make your resume look better - and you can take some more money from the bastards as you go out the door!".

  Another good friend, and well known past poster (by his ID) here, just said "Well I'm happy you have decided to wean yourself out of that meagerly paycheck. Now we have to work on weaning the IBM thinking out of you so you can be successful out there!". I've received 3 unsolicited job offers and calls to interview at HP, Cisco and an IBM Business Partner.

  I'm not taking the lump sum because actuarially it is essentially another attempt of theft from management and my health seems good. Here's my steps: 1) I've decided to not formally announce my retirement to my management until the last minute, maybe 30 days to 2 weeks out. I don't hate them, I just can't understand the business model they are operating. I really think they are powerless to do much anyway. 2) I am requesting a pension estimate from the ESC this week. 3) I'll clean up my admin stuff and making sure I'm ready to leave at a moment's notice in case I'm lucky and get a severance package. 4) I'll take all of my holidays ASAP. 5) Since I'm mobile, I have no worries about an office, but I think I'll stock up on office supplies.

  Thanks for the help, folks.

• Forbes: Why Your Wallet Feels Thinner. By Melanie Lindner. Excerpts: The U.S. Federal Reserve has been slashing interest rates to stave off a recession. One potential risk to that strategy: inflation. The bad news is that prices for many everyday items had already been ticking up, according to data from December 2004 and December 2007 collected by the U.S. Department of Labor. During that period, the Consumer Price Index, which measures the average change in prices over time for a basket of consumer goods and services, grew at a 3% annualized clip. But prices for many everyday items are rising even faster--and that's making everyone's wallet feel a little thinner. ...

  "It's all well and good for [Bernanke] to say there's no inflation, but that's just not the case for the supermarket shopper or the average person filling their gas tank," says Arthur Hogan, an analyst with Jefferies and Co., an investment bank. Hogan believes the Fed is more concerned with the dangers of an economic slowdown than inflation. ...

  But lofty prices don't just loom in the grocery aisle and at the gas pump. Look closely and there are pockets of inflation across many sectors of the economy. ...

  Then there's the real killer: health insurance. Since 2001, insurance premiums have jumped 78% for family coverage, far outpacing inflation, according to research by the Kaiser Family Foundation, a Washington, D.C.-based health care policy research foundation.

• Forbes: The Best And Worst Companies For Customer Satisfaction. Tom Van Riper. Excerpts: When tumbling home values and high gas prices already have consumers spending less at stores, car dealerships and airline ticket counters, how does a company minimize the pain?

  One way is to offer superior customer service, the better to compete for the fewer number of dollars out there, and set yourself up with loyal customers for the inevitable economic rebound. A new report finds a lot of companies like Wal Mart and Home Depot seem to have a different plan. ...

  Cutting back on service is an easy way to save a buck when things slow down, but it's also short-sighted. Gruca is putting the finishing touches on a follow-up report that measures a firm's willingness to invest in service and spruced up stores against long term profitability growth. He doesn't have final numbers yet, but he says the preliminary results show a strong link.

• USA Today: Turning 62: Have your retirement cake and eat it, too. By Sandra Block. Excerpts: Most financial decisions require trade-offs. If you want to earn better-than-average returns in the stock market, for example, you need to tolerate above-average risk. Similarly, an adjustable-rate mortgage offers lower initial payments than a fixed-rate mortgage. But if interest rates rise, you and your furniture could end up on the sidewalk. America's oldest baby boomers, who are turning 62 this year, face similar trade-offs in deciding whether to claim their Social Security benefits early. A little-known Social Security option, though, gives early retirees a way to have their cake and eat it, too.

  Here's the quandary: If you claim benefits at 62, you can retire while you're young enough to enjoy it, but you'll receive reduced benefits for the rest of your life. By contrast, waiting to file until at least full retirement age (66 for boomers who turn 62 this year) will increase your monthly payments, reducing the risk that you'll run out of money in your old age. For many boomers, though, that means working longer — a hard pill to swallow if you hate your job and want to spend more time with your grandchildren.

  What most retirees don't realize is that they can change their minds. Under the Social Security Act, individuals who receive early-retirement benefits from Social Security can withdraw their application, repay the benefits they've received and refile for higher benefits at a later date, says Mary Jane Yarrington, senior policy analyst for the National Committee to Preserve Social Security and Medicare.

• Financial Week: IRS wants to tax golden parachutes. Its proposal would mean rewriting most pay contracts. By Jeff Nash. Excerpt: A tax ruling last week by the Internal Revenue Service could bring an end to the controversial practice of granting golden parachutes to top executives who are pushed out amid corporate failures. Under a tax rule known as Section 162(m), compensation of more than $1 million each to the CEO and three next top-paid executives, excluding the CFO, is not deductible unless it is performance-based, or tied to a target such as earnings growth. While it’s not stated in the rule, the IRS for more than a decade has permitted arrangements to be considered performance-based even if they had a provision that allows for the payment or vesting of an award—regardless of achieving a financial goal—upon the firing of an executive without cause or as the result of a resignation.
• eSchool News: Gates to students: Consider IT careers. Chairman says Microsoft is forced to look for talent in developing countries. Excerpts: A widespread shortage of information technology (IT) graduates across North America is forcing Microsoft Corp. and other software companies to look to developing countries such as China to meet their needs, Microsoft Chairman Bill Gates says.

  When we want to hire lots of software engineers, there is a shortage in North America—a pretty significant shortage,” Gates said in an interview with The Associated Press. “We have this tough problem: If you can’t get the engineers, then you have to have those other jobs be [relocated to] where the engineers are.”

• Yahoo! IBM Employee Issues message board: "Re: Bonus CEO says significant increase? I didn’t see an increase" by "Mike". Full excerpt: That is what I have been told in the past as to the bucket system. Like the PBC system your dollar percent may vary with how much the manager likes you and not how well you actually did your job. Just the nature of the new IBM beast.

  30 years and a raise every year? Unheard of in my project !!!!! GDP every year but nobody has gotten a raise every year in a long, long time. The best in the area average about every other year for the past 6 years. The "below best" are starting to starve. Some even cutting into their 401Ks to make ends meet.

  It would appear in my area that the death spiral is out of control. Management screwed too many people and morale went to hell. The carrot no longer means anything and it shows in the work. Clients hit the pavement and the grunts could care less. You can only be beat up so many times. Now PBC's will drop further, moral will drop further, clients will drop. Soon it will just the first line and second line wondering what happened.

• MSN Money: The year's scariest investing news. A federal agency rolls the dice to fund busted pension plans, showing that the gambler's thinking that got us into the housing and credit mess is alive and well. By Jim Jubak. Excerpts: What's the scariest investing story of 2008 so far? It's not news that the median price of a new house is down 17% from its 2007 high --- and still falling. Or that Miami has a 37-month supply of unsold condos, with 19,000 more new units set to hit the market this year. Or even that losses at banks and investment banks in the debt-market meltdown could hit $400 billion.

  Here's my nominee: The Pension Benefit Guaranty Corp., the government agency that protects the pensions of 44 million workers in case their employers can't (or won't) pay promised benefits, has announced that to avoid going bust it will double the percentage of its portfolio -- to 45% -- that it puts into stocks. An additional 10% will go into alternative investments, including hedge funds.

  In other words, facing a $14 billion deficit and even larger projected shortfalls, the Pension Benefit Guaranty Corp., or PBGC, decided not to save (by raising premiums) or to live within its means (by cutting benefits) but to gamble in the financial markets by taking on more risk. The PBGC was so proud of its new strategy that it announced it on Presidents Day, when the U.S. financial markets were closed and almost no one was paying attention.

  So why is this so scary? Because as a result of 10 years of booms and busts -- the Asian currency crisis, the Long Term Capital Management hedge fund disaster, the tech stock bear market of 2000-02, the housing smash-up, the debt market debacle -- I've increasingly come to believe that those of us who play by the rules (work hard, live within our paychecks, save) are chumps. The way to get ahead is to gamble big and then, if you lose, find someone to cover your losses.

• The Huffington Post: Bill Buckley. By Bill Curry. Excerpts: Bill Buckley died Wednesday at 82 at his home in Connecticut. He was the most influential public intellectual of his generation in this country, maybe the world. More than anyone, even Goldwater or Reagan, he was the father of modern conservatism, which was as much an intellectual as a political movement from 1955, when he founded the National Review, to 2000 when, under Bush and DeLay, the movement foundered in a sea of law breaking, war mongering and greed.

  Buckley loved debate. Unlike today's cowardly conservatives, he debated the best minds he could entice on to a stage. He never used his opponents as props or punch lines for fixed fights. He liked them. Loving his own ideas, not just hating theirs, left room for liking them. ...

  To get out of Iraq or into a new health care system will require some hard fighting, but also some hard thinking and most of all reasoned arguments to persuade, if not the opposition, certainly the public. If you want to see how far we are from having that kind of debate, watch an old episode of Firing Line and then watch a random hour of live cable television. That's how far.

  Bill Buckley raised an army against a liberal establishment. Like Barry Goldwater, he often dissented in later years from a conservative establishment he helped create. The political debate Buckley launched is over, many of its old categories defunct. To shape a new debate we'll need at least a few people with the intellect, humanity, civility and great good humor of Bill Buckley. I hope we find them.

• New York Times: Is a Lean Economy Turning Mean? By Peter S Goodman. Nicole Flennaugh has a college degree, office experience and the modest expectation that, somewhere in this city on the eastern lip of San Francisco Bay, someone will want to hire her. But Ms. Flennaugh, 36, a widow, cannot secure steady, decent-paying work to support herself and her two daughters. Nearly two years after she was laid off as a customer service representative at the Educational Testing Service, and even after applying for dozens of full-time jobs, she has been getting by with occasional stints as an office temp.

  “You’re used to making $17 an hour with benefits, and now you have to take any job for $8 an hour,” Ms. Flennaugh says. On a recent afternoon, she sat in front of a computer terminal at an employment center in a gritty part of town, scrolling dejectedly through online job listings while sending another batch of applications into the ether. “I’ve literally sat and cried, but my friends with double degrees are doing worse,” she says. “It’s the economy. It’s really bad.” ...

  Across the nation, the labor market has been deteriorating. Many companies, long reluctant to add workers, are hunkered down and waiting for improved prospects, engaged in what Ed McKelvey, a senior economist at Goldman Sachs, calls “a hiring strike.” Americans with jobs are taking cuts to their work hours; those without jobs are staying out of work longer, or accepting positions that pay far less than they earned previously. ...

  Indeed, the increasingly anemic job market comes on the heels of six years of economic expansion that delivered robust corporate profits but scant job growth. The last recession, in 2001, was followed by a so-called jobless recovery. As the economy resumed growing, payrolls continued to shrink.