April 15th 17th

On many April 14th's we've burnt the midnight oil preparing our tax returns, and this year is no exception. For the 2011 tax return we're still awaiting a Form K-1 from a pass-through entity and will file Federal Form 4868 that will extend the deadline to October 15th.

Filing an extension postpones the need for doing some of the detailed work, but the lion's share still has to be done to determine whether and how much to pay with extension Form 4868. We also need to take a quick look at 2012 because estimated taxes are due the same day.

Thanks to April 15th falling on a Sunday, and Emancipation Day (April 16th) being a public holiday in the District of Columbia, tax-filers have a couple of days grace to work out the numbers. Too bad for residents of DC, though: now that everyone else in America has discovered that DC's special status allows everyone to file and pay one day later every six years, DC will never be granted Statehood. But don't feel bad for them: booming job and housing markets, as well as very low unemployment, ease the pain.

Thunderous Thursday

Sutro Tower strike

The lightning flashes shone through the drapes. The thunder boomed three seconds later. The storm was just above our heads, and our ten-year-old shingled roof didn't feel very solid.

The thunderclaps continued half the night, and we didn't get to sleep till 1 a.m.

Tornados, tsunamis, temblors, and thunderstorms remind us that our controlled, cosseted, civilized existences are an illusion. They can vanish in a flash.

Patent Mess

The iPhone "slide to unlock"

Patent wars in mobile technology are being waged over nearly every feature of mobile phones:

In the past two years, legal disputes have erupted over digital-image storage methods, camera designs, Wi-Fi technologies and well-known software applications like email and calendars, as well as secondary features most consumers barely notice.

Non-insiders will be surprised to learn that major battles are being fought over slide-to-unlock technology. Patent-holder Apple is suing rivals Motorola and Samsung over their "stretch-to-unlock" and drag-outside-the-circle unlocking techniques. Meanwhile, Samsung has unearthed an older patent that has some features similar to Apple's. (Disclosure: I am long Apple.)

The larger issue is the mess that is U.S. patent law. Patents that should never have been approved are stifling innovation while disputes are being contested in overburdened courts. An entire industry of patent trolls has been built around the extraction of royalties from producers who, usually unknowingly, have infringed upon an idea that someone has patented but not exploited with an actual invention. In this litigious environment I am personally acquainted with very small companies who spend precious management and financial resources on obtaining patents for largely defensive reasons.

One of the principal issues in this election year concerns whether and how much taxes, regulation, and other government activities are stalling the American economic engine. Our patent and intellectual property laws--and their administration--clearly contribute to the problem. However, because of the powerful interests on various sides of the question, not to mention its complexity, it is highly unlikely we'll soon see a solution that improves the general welfare.

Roth Confusion

Five days before the deadline I gave the financial institution my Roth contribution for 2011. The lady looked puzzled: "You already gave us a check in December." Apparently, I had made the contribution when I made the Roth conversion.

She asked to see my ID. Yes, I would ask to see it, too, if I were talking to someone who didn't remember making a payment of several thousands of dollars a few months ago. (It turned out that the December payment came from an account that I don't normally use for retirement contributions.)

We decided to reclassify today's contribution to 2012.

I think I will sign up for the durable power of attorney workshop that the church is offering next month.

Hotel Psychology

"Hotels are amping up their efforts to make a good first impression."

A guest's first impression is even more critical these days because of social media. In the past, guests usually waited until after they checked out before posting a review on TripAdvisor or Expedia, so hotels would have time to recover from an initial service snafu. Now, with guests tweeting and posting Facebook updates about their vacations almost in real time, a bungled first impression can be immediately broadcast to hundreds—even thousands.

Bagel and lox breakfast ($11.50) - Daily Grill, Burbank

(I rarely post critiques in real time on Twitter, Yelp, or Facebook, partly because of lassitude and partly because first impressions are often incorrect.)

Our top priority is a clean, quiet room, which we obtained, a little to our surprise, on our recent vacation.A quality restaurant with efficient service is a definite plus; it's not expected to be cheap, but the guest shouldn't feel he's being ripped off because of his partially captive status.

I have mixed emotions about the growing use of psychology and personal information. It's creepy when a stranger we're talking to knows not only our address, phone number, and credit card info (not to mention our credit rating) but also our breakfast preferences and medical needs. But I do like how experienced staff put us at ease by referencing previous visits and catering to special requests without our having to mention them.

Of course, a little knowledge can be dangerous:

A personal welcome can sometimes backfire, though, especially when it comes to repeat guests. A prior visit could have been with a previous girlfriend, for example, or a mistress. "You don't always say, 'Welcome back Mr. and Mrs.,' " says Mark Harmon, chief executive of Auberge Resorts, a collection of nine properties. "You have to be careful."

Unplanned Getaway

We had a few days off and drove to Los Angeles for an unplanned getaway. Sometimes the most enjoyable trips are those that aren't scheduled tightly.

The Daily Grill skirt steak

The first pleasant surprise was the Airport Burbank Marriott, not on anyone's list of top vacation hotels. Across the street from the Bob Hope Airport, the room was clean and quiet.

The hotel's restaurant, the Daily Grill, was very good. I had the skirt steak, which at $25 was one of the least expensive beef entrees. The Daily Grill marinates the skirt steak for twelve hours, and it came out tender and tasty. Companions' filets ($32) were perfectly grilled, and the blue-cheese crust had a sharp, rich flavor. Side orders of carrots, asparagus, and mushrooms were generously portioned.

Theater owner Sid Grauman has his own imprint.

The evening was still young. We took the seven-mile drive south for our first visit to Grauman's Chinese Theater. We goggled with the rest of the tourists at the stars on the Walk of Fame and the signature imprints on the forecourt. IMHO, the theater tour (adults $13.50) is a good value. Our knowledgeable guide had an anecdote for every exhibit. The women in our group were especially keen on the evening gown exhibits and artifacts like Elizabeth Taylor's jewels from Cleopatra (observations can be both sexist and true). The guide pointed out easy-to-miss sights such as the original natural-gas lamps behind the exit signs and paintings by bandleader Xavier Cugat and actor Keye Luke.

The "flash flood" has been around since early Westerns.

Universal Studios was next on the list. High-tech attractions have been added over the ten years since we last visited. We were entertained by all of them, but our favorites were the studio-tour tram ride that originated the whole Universal amusement park concept and the decidedly low-tech animal show. Also, a 360-degree 3D King Kong movie was a poor substitute for the destroyed-by-fire roaring ape's head rising from the pit.

It only cost $30 to upgrade our one-day ticket to a 12-month pass. We'll be back soon.

Hybrids: Heart Over the Head

Until we found out that the old minivan had a few miles left in her, we were on the verge of buying a new SUV. It would have been a hybrid.

We knew what we were getting into if we pulled the trigger. Not only was the hybrid's MSRP $8,450 higher than its regular counterpart, the manufacturer and dealer discounts on the regular SUV but not on the hybrid would have raised the hybrid's premium to at least $10,000.

Under the most favorable assumptions regarding gasoline usage and prices the hybrid purchase is a break-even proposition: 1) Assume we would drive either vehicle 100,000 miles (over the next 7-10 years) and that the average price of gasoline during the SUV's lifetime will be $5 per gallon. 2) From the manufacturer's specifications, assume that the mileage for the hybrid is 28 mpg and the non-hybrid is 18 mpg. The cost of gasoline: Hybrid $17,857 (100,000 / 28 x $5) Non-hybrid $27,778 (100,000 / 18 x $5). Of course, we're not considering the time value of money, since the $9,921 in gas savings will be realized over the next 7-10 years.

In the hybrid's favor we need to recognize that it also confers intangible benefits. Driving a hybrid: 1) Helps the environment; 2) Promotes energy independence; 3) Raises our social status, especially in the Bay Area; 4) Makes us feel better about ourselves. And yes, because we have enough saved up to pay the $10,000 difference now instead of over time, we would have bought the fuel-efficient alternative.

However, most Americans appear to have decided that those intangible benefits aren't enough:

Car sales are up again, but despite rising gas prices, few consumers are buying hybrids. Instead, they’re choosing less fuel-efficient – and less costly — subcompacts and mid-size vehicles. [snip]

Despite the large swings in gas prices, hybrid sales have barely budged: they made up just 2.1% of market share last month, almost unchanged from a year ago. Of the 1.4 million cars that sold last month, less than 30,000 of them were hybrids. “Interest in hybrids is not as high as one would think especially in light of high gas prices,” says Jesse Toprak, vice president of market intelligence at TrueCar.com.

Happy Easter

When words seem inadequate....the three traditional hymns of Easter:

Jesus Christ is Risen Today


He is Risen


Welcome, Happy Morning


Hallelujah!

Top of the Mark

The view makes a $7 beer a bargain.

The amateur San Francisco tour guide begins without taking a step. The guide must discover how much time the visitor has, how familiar he is with the City, and the visitor's preference between depth or breadth of experience. If the visitor is interested in cramming as many sights as possible into a short period, for example, then he might try the one-day quickie tour.

Union Square

On Wednesday the amateur guide appraised his client objectively. Touring by auto would be unsuitable; there must needs be beer, and it would be unsociable for the guide to abstain to keep his blood alcohol level below the driving limit.

On the other hand a lot of walking for one who is not accustomed to the steep hills may make for an unpleasant experience.

The visitor helped make the decision; he expressed a desire to see Grace Cathedral, the Mecca for western Episcopalians. Nob Hill it would be.

We departed the hotel and walked two blocks to Union Square. The visitor had last seen the square in the mid-1990's and was impressed with its 2000 renovation.

We trudged up Powell to the crest of Nob Hill. It was time for our break.

I first visited the Top of the Mark as a 21-year-old graduate student. To a starry eyed kid from the Islands the Fairmont and Mark Hopkins hotels represented the pinnacle of San Francisco sophistication. That one could drink in the view from the top floor of the Mark Hopkins for an unrushed $2 glass of beer was one of the greatest deals he had ever seen.

Over 30 years later the price of a glass of Anchor Steam at the Top of the Mark is $7. It's still a great bargain.

Swan Oyster Depot

After satisfying the visitor's request to tour Grace Cathedral, we strolled west on California to the Swan Oyster Depot, which has a permanent spot on the list of the Chronicle's top-100 Bay Area restaurants. One has to make a determined effort to dine there: seating is limited to an 18-stool counter (and there's always a line), the restaurant closes at 5:30 p.m., payment is cash only, and street parking is scarce. But determined efforts are what we amateur tour guides are known for.

There were five people ahead of us when we arrived at 4 p.m. Wednesday. We were seated in 20 minutes.

There are no menus at SOD. The fairly limited selection and prices are posted behind the counter.

Because of the proximity to fellow diners (and the girth of modern-day Americans, including ourselves), one is nearly forced to make conversation, such as "I think that's my bread" or "these clams are delicious." ("How do you like them oysters?" is neither witty nor original.)

Despite the aforementioned drawbacks the Swan Oyster Depot is definitely worth a visit. The seafood is very fresh, and the prices are reasonable.

The $11 combination cocktail was chock full with crab, shrimp, and clams. The $5 bowl of white clam chowder had a distinctive clam flavor; it was thinner than prepared by most restaurants and didn't have too many chunks of potatoes and clams. When complemented by sourdough and butter, however, the SOD clam chowder is the archetypical San Francisco meal.

Dining at Swan Oyster Depot is one of those experiences where positive memories become stronger as time passes. At some point in the future, when the craving for fresh crab, oysters, and clams becomes overwhelming, I'll be back.

Missed Opportunity

The Chronicle's annual list of the Bay Area's top 100 restaurants has been released, and I was distressed to discover that one that we had enjoyed very much had closed.

Kaygetsu of Menlo Park is where we had been introduced to kaiseki, the Japanese cuisine consisting of a series of small, artistically prepared dishes. (Actually, we had tasted kaiseki in the early 1990's, but our memories of the event are very hazy due to the sake which our Tokyo hosts had liberally plied us with.)

The best dishes possess complementary flavors and contrasting textures, beautifully presented. Kaygetsu did that repeatedly, a dozen times over a leisurely 90 minutes. (Unfortunately, the photos from our cheap point-and-shoot camera don't do justice to the presentation.)

We thought there was plenty of time to return. We didn't, and now it's too late. Carpe diem.

They're Paying Me for This?

This is not my dream job, but somehow I can't stop thinking about it. Silicon Valley companies are hiring hundreds of shuttle-bus drivers:

As Valley companies build out their private transportation system they're creating relatively cushy jobs for a decidedly low-tech group of employees: the drivers who operate the buses.

At Google's Mountain View headquarters, there is a special facility designed to keep workers happy and relaxed during their downtime, a Google spokesperson said. It's got a kitchen stocked with food, televisions, bunk beds for napping, exercise equipment and showers for washing up afterward. [snip]

Genentech drivers, uniformed in black fleece vests with the transportation program's logo, gRide, embroidered beneath the lapel, earn between $17 and $30 an hour, plus benefits, and quarterly bonuses of $250, [Genentech manager Daniel] McCoy said. In addition, employees often pool their money to provide holiday bonuses, McCoy said.

The downside is the split shift:

One Genentech driver starts her day at 5:30 a.m. By 8:30 a.m., she's dropped off her passengers at the company's headquarters, and waits until 4 p.m. to start shuttling employees home before she clocks out at 7 p.m. Drivers can sometimes pick up extra paid hours by washing or fueling the buses, McCoy said.

To empty-nesters or near empty-nesters, the split shift is a feature, not a bug. Driving a high-tech, air-conditioned shuttle bus in the morning, then having the choice of exercising, napping, or hanging out in the company lounge with free food and wi-fi, then taking the wheel again in the afternoon sounds like a great way to spend the day, even without being paid.

And to get the job we don't have to answer those tough interview questions...

The Circles of Our Discontent

Novelist and writing professor Dean Bakopoulos says that Facebook is a source of contemporary unhappiness [bold added]:

It’s a highly constructed version of our own reality. It follows a narrative of contentment and bliss. People might post something mundane, but it becomes a euphoric moment about cooking a hot dog on their new grill. I just deactivated my personal account two weeks ago. Everyone on Facebook appeared to be doing better than me. I thought, “I don’t need this. I don’t need to see how many pages someone has cracked out in one day or how many awards they won that week.”

Mr. Bakopoulos is speaking of envy, one of the ancient sins to which nearly everyone is susceptible. Envy is one of childhood's most basic emotions: who among us has not envied a playmate's toy or clothes or even her family, finding ours wanting?

Whether or not we are afflicted ourselves, we can lessen the envy---and unhappiness all around---by toning down the bragging (safe harbor should be granted, however, for pictures of babies). Boastful behavior, after all, stems from another of the ancient sins.

Caveat Emptor

After a decade that introduced Sarbanes-Oxley, increased disclosure, and increased regulation "America's pre-eminent forensic accountant" says that public company financial statements can be as misleading as ever.

Howard Schilit doesn't accuse companies of fraud or even technical accounting violations; in fact auditors seem obsessed with compliance with the letter of the law, especially rules about disclosure.

In general, the auditors' focus is on a legalistic interpretation. So, if you tied up your neighbor and robbed his house, but you disclosed it in footnote No. 23, it's okay.

When one reads the entire Barron's article, however, one is left with a reasonably sanguine impression of U.S. financial reporting. (The U.S. examples of questionable accounting relate to reclassification--not adjustment, there's a big difference--of items on the income statement and the treatment of contingent consideration, a liability that in this humble observer's view has offsetting mitigants on the asset side of the balance sheet. I can see your eyes glazing, so I'll stop.)

The examples from the wild, wild East are more troublesome: the tendency to switch accounting methods (e.g., depreciation, percentage-of-completion vs. completed contract) in an obvious attempt to hype earnings and the ability to book gains on asset purchases. To those who are thinking of investing in Asia an ancient phrase is appropriate: caveat emptor.

Palm Sunday, 2012

They'll be coming 'round the parking lot when they come...

(The post from two years ago, updated).

The rain and winds of the last week of March subsided, and April entered like a lamb. On Palm Sunday we began the service outdoors. Clutching our palm crosses, we marched around the block in symbolic emulation of Jesus' entrance into Jerusalem two thousand years ago.

New visitors are often in attendance, coincident with spring break. They could be seen glancing at each other in puzzlement: do we do this every week? No, just once a year. This isn't your grandmother's Episcopal Church where you stand, sit, and kneel, eyes fixed front, and don't deviate from the script in the Book of Common Prayer.

During Holy Week Christians remember the fleeting exultation of Palm Sunday, Jesus' betrayal by Judas, His abandonment, rigged execution, and astonishing triumph over death itself. From the highs to the lows to the ultimate high, it's a story that's hard to believe in an age where science rules more strongly than ever.

The fact that scientists have been shown to be fallible as other human beings and have changed their minds--even reversed their positions completely--should give pause to those who place their faith in science's direction. To believe or not is a choice, a gift that is nearly as great as life itself. In a world filled with portent and promise, choose wisely.