Thursday, August 21, 2014

Leonard Fein--Loved, Admired, and Blacklisted

During the few days since the death of Leonard Fein there has been an outpouring of testimonials in the Jewish press written by several of the hundreds of people who were personally and profoundly affected by the teaching, actions, and wisdom of this man.  To those of us who were lucky enough to know him and study with him, "Leibel" was clearly a true mensch, and true Zionist, and a true lover of Israel and the Jewish people.

I first met him when he taught my Wexner Heritage Foundation class in Milwaukee almost 30 years ago and then reconnected with him frequently over the years at Jewish conferences and, most recently, at J Street events.  Others who knew him far better than I have eulogized him eloquently in recent days and cited his many accomplishments and ways in which he affected the lives of thousands of American Jews and made our community and the world a better place.  He was a true mentor and an inspiration.

Perhaps the most profound testimonial to the importance of a man who most Jews had never heard of waspublished as an editorial in the Jewish Daily Forward:

"Since his death, Fein has been justly praised for the things he created: Moment, a magazine of Jewish ideas; MAZON, a Jewish anti-hunger initiative; the National Jewish Coalition for Literacy, a network of organizations that provides volunteer tutors for schools. Not only did he create, he left a sturdy legacy: All these institutions continue to thrive long after he left their employ, a testament to his values and foresight.
He became a Zionist in his teenage years, honed his involvement with Israel at the University of Chicago... but always remained, at heart, a teacher. Perhaps that is why he was able to influence and touch so many disparate lives — he was a teacher, not an instructor. He engaged those around him with good humor, in the sense of being funny — and he had a wicked wit — but also in the sense of being well intentioned. His aim was to use his mind to improve the world, not to win a political war of words."


What has gone unmentioned in any of the many pieces that have been written is any reference to the fact that this great teacher and lover of the Jewish people and Israel would have been blackballed from speaking or teaching at any of our college Hillels as well as many other Jewish venues for the last several years of his life.

That is because, true to form as a man of conscience, Leibel was very outspoken about his sincere belief that the Israeli occupation of the West Bank and the growth of settlements in the region posed perhaps the greatest threat to Israel's survival as a Jewish democracy going forward.

As a result, he openly urged Jews and others to boycott the purchase of products that were made in Jewish settlements in the West Bank and also urged Jewish organizations not to visit Ariel and other Jewish cities that had been built in the West Bank while on missions to Israel.  He was characteristically clear:

"Goods manufactured in Jewish West Bank settlements should never be labeled “Made in Israel” — a position gaining considerable popularity throughout the world. Those of us who advocate a two-state solution ought to stay away from Ariel, as many Israeli artists and intellectuals have pledged to do. Surely we should not consume the fine wines, dates and beauty products of the settlements. All these acts of protest are pro-Israel, in both intent and effect."

Those words expressed in writing and publicly clearly put this great teacher and lover of Judaism and Israel on the Black List and would have surely caused him to be banned by Hillel International and other Jewish organizations who have drawn red lines regarding who is and is not permitted to speak in their venues.

Hillel International President Eric Fingerhut made it clear that people like Leonard Fein are not welcome to speak about ANY issue in a Hillel building anywhere in the country as Fingerhut stated on the Hillel International website:
"Where Hillel draws the line... is that “‘anti-Zionists’ will not be permitted to speak using the Hillel name or under the Hillel roof, under any circumstances.” Our Israel guidelines that spell out that Hillel “will not host or work with speakers or groups that deny the right of Israel to exist; “delegitimize, demonize or apply a double standard to Israel”; support boycotts, divestment or sanctions against Israel; or “foster an atmosphere of incivility.”

These are clearly stressful and challenging times for Jews in Israel and those here in the U.S. who care deeply about the future of the Jewish people.

Among those who care the most are the many wonderful professionals and volunteer leaders at the Hillel chapters around the country.  Since moving to Tucson I have become most familiar with the Hillel at the University of Arizona where I have served on the board and remain increasingly impressed with the work of its director and her staff and her community and student leaders to create engaging, innovative and effective programming that provides Jewish students with a safe and exciting venue and make their Jewish college experience and relationship with Israel better in every way.

I have the same respect and praise for the leaders of the Federations, JCCs, synagogues, day schools, and other organizations which do important and amazing work to help build our Jewish community.  That is why it is so essential that we all work to change those policies which are designed to show support for Israel but which actually are proving divisive and harming instead of building our community.

In an often misquoted phrase, the Old Testament suggests that THE LOVE OF money--not money itself--is the root of all evil.  Similarly, it is THE LOVE OF Israel by certain of our American Jewish leaders and organizations--not Israel itself--which is leading to sometimes counter-productive behavior and policies that are driving good people away instead of bringing us together.

With the death of Leonard Fein our community has lost an effective and important builder, teacher, and voice.  It is appropriate and important for those among us who were touched and moved deeply by his friendship and insights to remember him for all that he gave us.

But perhaps the greatest testimonial--and certainly the one that Leibel would have found most meaningful--would be to both acknowledge and to focus on the well-intentioned but damaging policies of demonization and sinatchinam--baseless hatred of one Jew toward another.

Acknowledging and addressing THAT threat is perhaps the best way to honor the memory of this great and important Jewish leader, teacher, and mentor.

Monday, June 2, 2014

Why Gun Control Should Be a Jewish Issue

The most recent gun-related murderous rampage in our country has been greeted by the predictable outcry from families of the victims regarding the need for a more sane gun control policy.

The pleas about the rights of Americans to live in safety and not become innocent victims not to be murdered in cold blood are the most common.

But for Jews who take the Torah and its teachings seriously there should be a different and unique argument put on the table.

One of the most compelling and pragmatic commandments in the Hebrew Bible is found in Leviticus (Kedoshim) where were are forbidden to "place a stumbling block before the blind"  and we are reminded that we are to "love our fellow man."

For more than a thousand years our rabbis and sages have believed this prohibition is a metaphor compelling decent people to be  sensitive to the weaknesses and pathology of people who are challenged or have issues with self control or adequate intelligence to make responsible decisions.

The majority of mass murders in recent years have been committed by people who had a history of issues which were very challenging.  It would be hard to argue that the easy availability of mass killing machines helped them make the transition from being a troubled person to a mass murderer.

Rashi and other great Jewish sages normally speak in terms of this commandment forbidding us from engaging in irresponsible or predatory business practices where we take unfair advantage of our own insights and knowledge and exploit or tempt those who are "blind" in these matters.  

For example, according to the commandment a decent person is not allowed to buy a free cocktail for an alcoholic friend who is trying to quit drinking or to encourage an ignorant or unsophisticated friend to make a risky investment that he is not capable of fully understanding.

But an equally compelling case can be made that it also forbids us to make assault weapons and high-capacity magazines available without stringent background checks on the buyers to make sure they are not impaired or "blind" when it comes to issues of self control and civilized behavior.

The inclusion of the uniquely Jewish commandment would simply add even greater credibility to the arguments made by those of us who seek a saner policy and further discredit the already bankrupt arguments of those who hide behind a self-serving interpretation of our Constitutional rights to justify arming those who have killed far more Americans than terrorists in recent years.

As we know, most of those who oppose greater gun control are not motivated by Second Amendment rights or issues related to self defense.

When was the last time anyone ever heard of a person warding off an attacker with an AK-47 or a semi-automatic weapon capable of killing 30 people in 30 seconds?  

When people walk into a Wal Mart or gun show and buy a killing machine and unlimited amounts of ammo and clips capable of firing 30 shots in 30 seconds without regard to their psychiatric or behavioral history, they are never doing it to protect themselves.  We all know that.  But the NRA has twisted the narrative and used its immense power in Washington to make those of us who oppose their agenda feel thoroughly beaten.

When my friend Gabby Giffords was gunned down along with 18 other people in Tucson a couple of years ago, there was a man named Joe Zamudio in the crowd who did have a gun.  By the time he realized what was going on, raised his weapon, took off the safety and moved in, the killer was already on the ground being subdued and one of the heroes had taken his gun away.  

Here in Arizona, the pro-gun crowd had the chutzpah to name a bill after Giffords and her Jewish aide Gabe Zimmerman (who died in the attack) that would broaden gun availability and training on the theory that if everyone has a gun in all venues then there will be fewer victims of the bad guys.

The whole narrative of the NRA and the gun lobby is evil and self-serving and we all know it and hate it.  But the Jewish community just hasn't gotten passionate about it. 

The people who support the NRA and those who want to suppress a woman's right to choose on her own health and reproductive issues and ongoing discrimination against gays and illegal laws trying to keep Blacks and Hispanics from voting are passionate and they put their money and their power behind their passions. 

Isn't it time for Jews to go to spend more time, money, and energy on gun issues which are leading to the deaths of dozens of innocent Americans every year.  It sure seems like it is time to change or at least expand our priorities and change our behavior in this area.

Particularly in view of the uniquely Jewish narrative that we can add to the existing chorus of common sense and life-affirming arguments that should be compelling but are apparently falling on the deaf ears of so many of our legislators and Congressmen.  

The following news clip should have been the lead of the Washington Post article about the incident.  Instead it was buried at the bottom.

"Elliot Rodger owned three 9mm semiautomatic handguns, all legally purchased in his own name, and he had enough ammunition for a massacre — 41 magazines with 10 rounds each, Brown said. Two of the guns were Sig Sauer P226s and one was a Glock 34. 

Christopher Ross Martinez, a 20-year-old university student, died after being shot in the deli. His father, Richard Martinez, held a brief, emotional news conference late Saturday.

“Our family has a message for every parent out there: You don’t think it’ll happen to your child until it does,” the grieving father said. “His death has left our family lost and broken. Why did Chris die? Chris died because of craven, irresponsible politicians and NRA. They talk about gun rights. What about Chris’s right to live? When will this insanity stop?"
For Jews, one could argue that we have lost sight of our Jewish responsibility to each other as well.

Why is There Never Enough Anti-Semitism To Make Some Jews Happy?

The reaction to the recent Anti-Defamation League study on anti-Semitism has been swift and passionate.

Some believe that the study is a badly flawed and transparent attempt by the the ADL to make a case for its own importance and overstate the extent of real anti-Semitism in the world.  Forward columnist Jay Michaelson, a rabbi with a deep and lifelong history of commitment to Israel and the Jewish people, came to that conclusion.  He took the test himself and scored out as an anti-Semite—which he clearly is not.

Others believe that anti-Semitism in the U.S. and around the world is bad and getting worse. 

They seem less concerned with the validity of the survey than they are with emphasizing their belief that there are Jew haters all around us and that Jews should be as fearful as ever.  Jewish Federation professional Robert Horenstein wrote praising the study and offered this daunting conclusion:

"Not only has there been an uptick in anti-Jewish attitudes among Americans over the past 15 years, but even more disturbing, anti-Semitism has been gradually creeping out of the shadows into the mainstream.  The tragic murder of three people at two Jewish facilities in Kansas City in mid-April served as a stark reminder that anti-Semitism is alive and well."

Actually, one could easily conclude that the incident in Kansas City proved just the opposite.  It was a reminder that while Jew haters are alive and well and capable doing great damage, there is virtually no societal anti-Semitism in the U.S. any more.

Jew hatred in the U.S. is racism and bigotry felt and acted upon by individuals and small groups of hateful people.  Anti-Semitism--a condition where the behavior of those bigots is tolerated or even welcomed by the standards of the broader community is something very different. 

As we saw in Kansas City  there are very few places in our country where these people are welcome and where the entire community does not rise up and speak with a single voice to condemn, punish, and ostracize them if they speak out or act in a violent hateful way.

The most important conversation about anti-Semitism is the one that is not taking place—and which no Jewish funder has shown interest in sponsoring.

The real question for American Jews is why so many cling so tightly to the belief that Jews have always been and will always be hated and hunted victims—people who are supposed live in suspicion and fear of non-Jews? 

After all, we live at a time and in a country where non-Jews overwhelmingly and actively are seeking us out as neighbors, club members, business partners, friends and spouses.

Why do so many Jews believe that Israel is a victim of unfair bias in our mainstream media even though we live at a time and in a place where Israel has never been more widely supported or admired by Americans and when an important study by Robert Putnam showed that Jews are the most widely respected religious group in the U.S.?

The real question for American Jews is why so many cling so tightly to their addiction to their belief that Jews have always been and will always be hated and hunted victims—people who are supposed live in suspicion and fear of non-Jews? 

So why do so many of  older Jews still obsess about anti-Semitism at a time when few American Jews under the age of 50 can ever cite a personal experience or situation where they suffered in any way from Jew hatred or even minor religious discrimination?

Most of what all we feel and believe is based on our personal life experiences.  We are all human and can only change our narrative so much.  So it is understandable that older American Jews who grew up in a society where discrimination against Jews was widespread and accepted by broader society would cling to the time-honored mantra that "if you scratch a goy, you'll find an anti-Semite"  long after that slogan was based on fact and experience.

Growing up in St. Louis 50 years ago, I knew people who were getting nose jobs and changing their names so they would appear to be less Jewish. There were clubs, neighborhoods, professions, and private schools where Jews were not welcome. Today, most Jews are very proud to be Jewish.  I don’t know any Jews who are changing their names or appearance anymore--at least not for THAT reason.

Today, most non-Jews seem very anxious to befriend, work with, partner with, and marry us--so much so that many Jewish leaders have declared intermarriage to be a crisis.

Intermarriage is certainly a challenge, but let's be honest. The main reason that there is so much intermarriage is not because Jews are less Jewish--it's because non-Jews are so much more willing to marry us than ever before. It's because our parents fought bigotry and intolerance for decades to create a society where we would be fully accepted and have freedom to choose where we want to live, go to school, play golf, work, and socialize.  And, to fall in love with and marry anyone we want.

Teaching about the Holocaust and the persecution and genocide that Jews have suffered over centuries is critically important.  It is also important to realize that there are still places in the world where anti-Semitism is alive and well and to appreciate how blessed are Jews who live in the U.S. or Israel.

Jews should never forget our past and be informed about the challenges that remain in an often hostile world.  But let's keep it in perspective.

Instead of arguing over frightening studies and wringing our hands over how many people hate us, we should be getting on with the conversation about how to build a pluralistic, values- and wisdom-driven Jewish community that is both sustainable and compelling.

A narrative that than can thrive in a world in which Jews have unlimited choices—a situation that we fought to create for a very long time.

We need to find the right balance between the importance of Tribalism and Aspiration as we define what it means to be Jewish and how to best help and relate to Israel.

The choice is ours and we control the outcome.  

Not the anti-Semites.  Whether there are hundreds or billions of them out there.  They are not the biggest challenge in a world where so many Jews have so much power and unlimited choices.

Wednesday, April 2, 2014

Please God -- Save the Jewish Community from Itself

For more than 30 years, my relationship with Jewish Federations, Israel Bonds, AIPAC, J Street, CLAL, and Hillel have been the focus of my life as Jewish study,  Jewish values, and the Jewish community have provided me with the moral and intellectual compass that has guided all of my important life decisions.
I have chaired Federation  and Israel Bonds campaigns and led and helped create Jewish day schools in both Milwaukee and Tucson and donated millions of dollars to the Federation and other pro-Israel causes, from AIPAC to J Street.
That is why I am so saddened and frustrated at recent decision by the Jewish Federation of Greater Philadelphia and Hillel of Greater Philadelphia to co-sponsor a divisive film screening which demonizes a fellow Jewish group--in this case, J Street. Their decision is beyond disappointing. It flies in the face of everything that Federation claims to stand for.
The film, “The J Street Challenge” is nothing more than a lengthy political attack ad, featuring testimony from like-minded right wing pundits, and funded by well-known J Street detractors[a], who are trying to move from the fringe of our community to defining our community. The event was packaged as an educational event entitled, “What it Means to be Pro-Israel.”
Without question, an honest and respectful conversation on pro-Israel advocacy is sorely needed in the Jewish community--if only this event had genuinely pursued that goal.  The “J Street Challenge” does not promote this sort of conversation, any more than “The Protocols of the Elders of Zion” promotes academic understanding of Judaism.
On its website, the Philadelphia Federation proudly boasts its commitment to "One People. One Community. One Federation."  But their decision to sponsor this film paints a different picture. According to the filmmakers, there are two camps: the good, realistic Jews who love and support Israel and the naive, fantasy-addicted Jews who are threatening the survival of our people.
This message may resonate with some in our community, because it reaffirms everything that they already believe. Sadly, it will also alienate the large portion of the community--myself included--that has a different idea of what it means to be pro-Israel.
Indeed, given their shared missions of creating a broad and inclusive Jewish community, it is not clear what the Federation and Hillel hoped to accomplish by sponsoring this event. What they did succeed in doing was sending a clear message to their many caring pro-Israel friends and neighbors who support J Street that both they and their opinions are unwelcome.
That is personally painful to me as a supporter of Federation, Hillel, and J Street and, I am certain, to many others as well who are not in the J Street camp, but who also don’t wish to see a large and growing segment of the Jewish community alienated from the community as a whole.[b]
And who benefited here?  A handful of wealthy Jewish donors out to smear a pro-Israel organization whose success and message of openness apparently frightens them?
Our community has a vibrant diversity of opinion and we should embrace that. Whether you are a fan of this film, or one of the thousands of Jews who identify with J Street or among the millions of Jews who are trying to sort these complex issue out, we all love and care about Israel. If we disagree about the proper course for Israel to take, we should debate those differences openly, instead of slinging mud.
That’s why I’ve urged Federation leaders in my hometowns of Tucson and Milwaukee and around the country to speak out against this trend of Federations and Hillels working to stifle open discussion by promoting divisive programming driven by ad hominem attacks on members of our own community.. It’s not because I can’t handle those who express ideas with which I disagree, but because it would mean that the Federation has transformed from a force that builds community into one that destroys it.
I am sure that the Federation staff and leadership in Philadelphia have done wonderful and important work in their community. However, on this occasion, they undermined that work, and should be ashamed of themselves.
As a person who has worked so hard and invested so much in building and benefiting from our Jewish communities, it saddens me profoundly to see so many of the very organizations and people whom I believed shared common Jewish values and a commitment to open respectful conversation suddenly behaving in such destructive ways.

Sunday, September 1, 2013

Obama's Most Brilliant Decision Corrects His Worst Mistake

I think Barack Obama has been a pretty good president.  Most Americans are much better off today in virtually all aspects of our lives than we were five years ago and Obama has had something to do with that.

But a year ago, he made a huge mistake that in recent months he has come to regret.  He succumbed to pressure from the pro-Israel and Republican Right to intervene in the horrific mess that was evolving in Syria by stating, perhaps in an effort to seem as tough as his Israeli counterpart Bibi Netanyahu, that Obama had his Red Lines too and if the Syrian government ever used chemical weapons against its own people the the U.S. would have to take strong and forceful military action..

It was an inexcusable error since Red Lines have no place in our dynamic and fast changing world.  Our leaders need to constantly update their information and determine what course of action makes sense at any point in time.  That applies even moreso in the Arab Muslim countries of the Middle East which have been involved in dramatic internal upheavals that have nothing to do with us and which we don't begin to understand. 

It was a particularly unfortunate statement for Obama to make since he himself had stated in 2007 that no president has the right to unilaterally commit American troops without the approval of Congress.  So last year, Obama essentially promised to do something that he had stated was clearly illegal if his Red Line was crossed in Syria.

When it became clear a few weeks ago that the Assad government had used chemical weapons to murder more than a thousand of his own citizens, Obama was about to reap the harvest of his Red Line bravado.

As George W. Bush did regarding Iraq, Obama seemed on track to allow his ego and desire to save face to overcome common sense and plunge our country into an armed conflict in a part of the world where we really don't know as much as we need to know and, more important, where it would be impossible for us to make a positive difference.

The Israeli blogger and J Street friend Bernard Avishai made the complexity of the Syrian mess and the futility of armed intervention by the U.S. in Syria perfectly clear in his brilliant blog the other day.  Avishai set the following as a backdrop:

Let's get things straight. Syria is now fractured into zones controlled by 1) Assad, armed by Russia and backed by Iran, 2) Hezbollah, backing Assad's Alawite Shi'a sect, 3) the Kurds, always looking for ways of unifying the Kurdish homeland on the Iraqi border, 4) an insurgent Sunni-Islamist group, Jadhat al-Nusra--admiring (if not loyal to) Iraqi Al-Quaeda--and, 5) a (more or less) secular and (more or less) puny Free Syrian Army, the heart of an opposition ("maybe 1200 free floating groups") backed by Qatar, and led ("this month, anyway") by Ahmad Jarba, with ties to Saudi Arabia.

His conclusion was that an armed attack on Syria, no matter how "limited in scope" it might be at first would be an exercise in futility since we have no idea who the good guys are over there, quoting PBS commentator Ivo Daalder:

a punitive send a message to the regime that this kind of behavior is unacceptable"--is something like trying to stabilize the picture on an old TV by smacking it. What good it does bears no relationship to how good it feels.

Faced with the prospect of making a disastrous decision just to save face--and also facing enormous pressure in Washington and from around the world to do just that--Obama came through with a courageous and brilliant decision.

Instead of focusing on saving face, our president staked out the moral and legal high ground by stating that he favored taking action against Syria but believed it would be in the best interest of our country and true to our laws to do so only with the approval of Congress.

Think about how smart that is.  First, it forces those on Capitol Hill who have spent the last five years doing nothing on their own except criticizing the president to actually become engaged in a conversation and determine a course of action.

It is already clear how much confusion and disorientation that has created in Washington.  Republicans who have never said a good word about Obama in their lives have been issuing statements that the president did the right thing.  Many liberal Democrats who always support Obama are saying they disagree with the president.  The partisan divide that has defined Congress for the last four years seems to be in total disarray--at least for the time being.

None of the major pro-Israel organizations has had a word to say about what they think should be done.  J Street did come out with a statement condemning Syria's use of chemical weapons but, as an active participant in J Street's leadership online forum I can tell you I have never seen an issue where there were more heartfelt and compelling opinions and arguments on all sides of any issue.

On the Obama hating hard Right there of course has been focus on what a horrible leader Obama has been on this and every other issue. ran an article by Bruce Thornton which began with the accusations that Obama is a "malignant narcissist" and "incompetent" and made the obligatory comparisons to Chamberlain's appeasement of Hitler.  As is usual for FrontPage and the other sites which exist only to smear Obama and Muslims, none of the charges or insults was backed by a single fact or quote or any source material. 

I really encourage you to click on the link and read the whole piece--counting the number of serious accusations made against the president in the harshest of terms and then counting the number of facts or quotes or source materials used to support those provocative claims.

But after Thornton worked through the obligatory litany of unsupported smears of Obama, he made his major point-:

By far the biggest mistake of our contrary president is to ignore the wisdom every global power has known from Rome to the British Empire: the importance of prestige, which a great power nurtures by consistently rewarding its friends and punishing its enemies. Both friends and enemies have to believe your promises and threats will be followed by meaningful action. But this president gets it backwards: just make empty threats and preen morally, and then rationalize a failure to act by invoking “international law” and “U.N. mandates”

So our contrary president has managed to destroy our prestige, alienate our friends, embolden our enemies, increase contempt for our power, and leave behind a Middle East more violent, murderous, and hostile to our security and interests than it ever has been. Just what you would expect from someone who sees the world backwards.

In other words, if a president screws up or allows political pressure or the passion of the moment to cause him to make a statement that he later regrets, it is better, according to Thornton, to follow through on what might be a catastrophic mistake rather than risk losing face and prestige by changing course based on new facts and developments.

We actually just had a president who did that.  George W. Bush successfully pushed for war against Iraq based on his belief they possessed weapons of mass destruction that posed a threat to the security of the United States.  He was wrong and within a matter of months he KNEW he was wrong.  But rather than lose face and prestige, he pressed forward with a war that was based on a faulty premise causing the death and maiming of tens of thousands of patriotic Americans and hundreds of thousands of Iraqis--not to mention the devastation it wrought on our world standing and financial health.

Thankfully, our current president--who also took a position a year ago that was ill advised--had the courage and wisdom to regroup and rethink and pursue a different course of action.

He may lose face over this in the eyes of some.  The media is already replete with stories about what an embarrassment it would be if Congress does not approve the limited strikes that Obama has said he favors.  There are also complaints coming from Israel and the Syrian rebels and others around the world that American can no longer be trusted to deliver on its promises.

This could be a rough patch for Obama politically and he will have to brave many slings and arrows for his wisdom and bravery which, by the way, is not unfair since he did screw up in the first place. 

But thankfully for our country and for the world he had to courage reconsider and change course rather than keep doubling down and pushing more resources and lives and treasure into the pot as our previous president did--long after he and everyone else knew he was playing a losing hand.

You have to know when to hold 'em and know when to fold 'em.  We are lucky that Barack Obama understands that far better than the man who came before him.

Friday, July 5, 2013

What the Hell is Going on With the Market?

Although the end of the first half of the year now behind us, the volatility in the financial markets in recent weeks warrants an immediate comment.

I continue to believe that, now more than ever, it makes sense for investors to own outstanding American companies for long-term growth.  For several years now my accounts have been fully invested in reasonably-priced quality companies and every quarter my client letter has said the same thing.  “We are seeing a bubble in gold and bonds that will at some point burst in an ugly way and stocks will emerge as the most attractive investment of choice.” 

It had to happen—the only question was when.  For many years, there were net inflows into bond and gold funds which were falsely labeled as “safe havens.”  Most of the money that fueled those bubbles came out of stock funds which suffered two full years of monthly outflows even as the market averages doubled. 

The media ads promoting gold flooded the airwaves and the pitchmen were often the same conservative “news” reporters who had been predicting economic catastrophe as a result of our government’s policies.  Their status as wise people gave them even more credibility with their audience and the ease with which investors could participate in gold and silver through Exchange Traded Funds helped inflate the bubble even more. 

Last month, Federal Reserve chairman Bernanke stated the obvious—that the U.S. economy was steadily improving and if that continued the Fed could and should taper the size of its bond purchases in the open market.  That innocuous announcement served as a wake-up call to investors.  When Bernanke repeated the obvious again last Wednesday, it was apparently the needle that popped the bubble.

During the ten trading sessions since then, 10-year interest rates have soared to over 2.70 percent—up from their lows of 1.60 percent just weeks ago.  Gold has plummeted to its lowest level in years.  Massive mutual fund redemptions are causing the rout to feed on itself.

These developments should have been great news for stocks.  The economy is getting better.  One would think that much of the money suddenly flooding out of bond and gold funds would be reallocated to equities.  Most stocks are trading at valuations that seem quite reasonable by historical standards.  So why are stock averages down by more than 7 percent in recent weeks?  If those of us who have favored stocks have been so right about the fundamentals, why is the stock market going down when it should be going up?

Here are a couple of thoughts. 

First, we are in an environment where the majority of trading in all markets is dominated by huge hedge funds and high frequency traders which has added to short-term volatility.  As a result, in this interconnected world, nothing happens in a vacuum.

For example, one large hedge fund manager reportedly saw his gold holdings drop by almost $200 million in value last Thursday when gold fell by almost $100 an ounce.  When huge leveraged funds suffer big losses, they don’t just sell off their gold—they sell whatever they can to raise the cash to meet margin calls and rebalance their models.

In addition, even as the U.S. markets have held up reasonably well in recent months and are still well ahead for the year, overseas and emerging markets have fared much worse.  The Dow is still up by almost 10 percent for the year while the MSCI Emerging Market Fund (EEM) is down by almost 20 percent.  The Chinese market in particular has been quite weak and fell by 5.6 percent today alone. 

Second, our media have become addicted to crises and do their best to scare investors whenever possible.  It is bad for the country but good for ratings.  By any reasonable measure, the downturn of the last week does not yet qualify as a crisis or a major turning point in the market.  What we have right now is a 7 percent correction in an ongoing bull market.  Last year, the market suffered two 10 percent corrections in what turned out to be a very good year.  This could just be part of the normal volatility that goes along with being a long-term investor in stocks.

The other media mantra is that stock prices have gotten way ahead of themselves and investors are way too exuberant.  But the fact of the matter is that a smaller percentage of Americans own stocks today than ever before in recent history.  On top of that, a recent CNN poll showed that 87 percent of Americans believe this is a bad time to be in the stock market.

During my 33-year career I have learned what a market top looks like.  In 1999, investors were firing their brokers for “only” producing 20 percent annual returns and were losing sleep at night because they didn’t own enough internet stocks and were missing out on the rally.  That is what a top looks and feels like.  It is almost the exact opposite of the sentiment among investors today.

So on balance, we live in a dynamic world where no reasonable person could say that “nothing has changed.”  A lot has changed and more is changing every day.

But our investment outlook remains the same.  Now more than ever, we believe that owning quality, well-run, reasonably priced American companies will prove very rewarding for investors with a medium to long-term investment horizon.

















Saturday, June 22, 2013

Israelism Revisited

I have received a number of responses to yesterday's article in which I coined the term "Israelism" to describe the over zealousness on the part of many of my fellow Jews who are loving Israel to death.  Perhaps more damaging are their slanderous accusations of anti-Semitism against dozens of decent people and public figures--many of whom are Jewish themselves.

Some people have thanked me for "hitting the nail right on the head" and "saying what needed to be said."  But others, including many close friends, were annoyed and even angry over my use of the term "Israelism."

Here is part of what my good long-time and very intelligent friend Bruce had to say:

Your use of labels makes you, if not equal, then worse, then those you criticize. You are worse, because by criticizing those who falsely label others as anti-Semites, you admit that you know how wrong it is to label this way, yet you do it anyway.
You seek to support the branding of Israelism and Israelists to be a dirty word. Just what we need is a new title to label and brand another Jew. This is what Judaists think will return civil discourse?
Imagine if you were successful. We would all learn to hate Israelists. We would root out the ugly Israelists amongt us. Sort of like the new Amalekites. Supporting Israel must make you a dirty Israelist. And Israelism will eat your soul. Hell, if you were successful enough, your term would catch on and the mass media would begin to call any supporter of Israel an Israelist. Now, wouldn't that be wonderful?

First and foremost, I do not use "Israelist" to describe the vast majority of Jews who, like myself, feel a strong connection to the land and people of Israel and who take pride in the many accomplishments of the Jewish state.  It is only descriptive of the small but vocal and powerful group that claims to speak for the Jewish community (although it clearly doesn't) and violates most of the key Jewish prohibitions against using slander, distortions, and lies in an overt effort to destroy the reputations and careers of good people.

As always, I fell back on a sports analogy.  I can't help myself.  Before I was God's gift to money management and then the savior of the Jewish people I worked for ten years as a TV news reporter.

I am a big University of Arizona basketball fan. Like all successful programs they have a strong booster club (AIPAC?) which holds pep rallies where they sing the school song (Hatikvah?).and show highlight films which feature the great plays made by our team and the dirty plays made by the other team because the booster club is not there to educate or provide balance. Their goal is to get their fan base whipped up and make them even more devoted to the team. That is all a good thing.  I attend these pep rallies myself.
When I go to the games--which I love--the most vocal and rabid fans sit in a corner the student section--the Zona Zoo. In past years, a small but vocal group of self-described fans have shown their support for the team by spitting on and swearing at members of the other team.  Often these fans (which of course is short for the word "fanatic") did some research and found personal details about opposing players and used personal insults about their families as part of their desire to help the home team.  It got so bad that two opposing coaches said they wouldn't play at Arizona again unless their teams didn't have to walk through the tunnel that is always flanked by the abusive Wildcat fans.
 I don't think it is hateful for me as a fan to speak out against those who are giving the rest of us a bad name. Quite the opposite. I am proud that the University of Arizona revoked the season tickets of several of those fans, publicly apologized to their victims, and made it clear that this kind of "support" is in conflict with the schools values and ethics.  The players and coaches also made it clear that this kind of behavior actually hurts and embarrasses the team that these fans were trying to help. 

As an aside, a strong and healthy team also has radio talk show and blogs where fans like me who have opinions--sometimes positive and sometime critical-- can weigh in and be heard. That was the huge void in the pro-Israel infrastructure that was missing before J Street came along.

 My friend, we have studied Torah and Jewish wisdom together and you have worked with me for years on Federation and Israel Bonds campaigns and you know I was a past board member of AIPAC. I am a bigger fan of Israel than I am of either the Packers or the University of Arizona about which I am borderline fanatic.
The last thing in the world I would do is demonize or perjoratively label people who support the democratic Jewish State of Israel. But I think we need to rise up as a community and police our own ranks and make it clear that those who violate  principals of Jewish values and ethics by unfairly and publicly slandering public officials and fellow Jews and smear them as anti-Semites are crossing the biggest of red lines.

And when their behavior is as shameful and outrageous as those cited in my article from yesterday, they should be stripped of their tickets and asked to leave the stadium. Not because I disagree with their right to express their opinions and certainly not because they consider themselves staunch supporters of Israel but because those who engage obscenity and vulgarity and disregard for Jewish values should not be allowed to claim they speak for our Jewish community and reflect our values.