The Baseball Update

Quick one tonight. Sox just won 4-0. Solid, if unspectacular performance by Lester against the Orioles. Three Things I noticed: (1) Coco My man. He Loves us. I don't even mind if he dances with my date. Another great scrappy hitting night. No spectacular defense tonight, but that's o.k. (2) I am now convinced that Jim Palmer is probably the second best ex-player analyst in any sport (Jaws, so far, is number 1, but I'LL BE WATCHING MONDAY). He was spot on on why Cabrera balked (didn't pitch from the stretch) and generally was witty, candid (noting the reason why Devern Hanseck threw the no hitter in a monsoon on the last day of the season last night was because the Sox didn't want to give up their $2.5M gate) and generally smart. I dig Remy, but I could get used to a guy like Palmer too. (3) Daniel Cabrera is an idiot. Not sure what the hell happened there, but he's starting to remind me of a famous quote about Rod Stewart. i'm paraphrasing... very rarely is a man so gifted with talent and even more rarely does someone screw it up so badly.

The Taxes Update

Huge day today.

(1) Fallout from yesterday's Congressional hearings. The House had a marathon hearing on all kinds of tax issues, none of them I have confidence they will actually solve. Thankfully, my man Charles Rangel (D-Harlem BABY!) wants to totally revamp (renovate, novate?) the AMT in connection with any tax reform. Well, I fully applaud that, but am skeptical that this Congress with this President would be able to push something like that through without any obvious revenue raisers out there to offset the cost.

(2) Senate also held hearings yesterday, more focused on the effect raising taxes on carried interest would have on pension fund investors. Answer - not much. Well, duh. The big gorilla (I don't like elephants) in the room is that private equity, while extremely important in mergers and acquisitions and turnarounds, still is a niche investment allocation for most investors. 10% or so for pension funds. I'm still surprised that this is a surprise.

Anyway, my &*!# IT department failed to record the hearings for me, and I don't expect that C-Span will rebroadcast the hearings, so I will see what I can find online and review the prepared testimony from the hearings.

The ever indispensible Dan Primack did a liveblog of the hearings here which has links to lots of other good stuff. Check it out. He really is the man.

(3) Rep. Sander Levin has on his website text of a bill that may or may not have been introduced in the House today which would extremely liberalize the rules on tax-exempt investments into private equity and hedge funds. You can find the text here. The issue is that tax-exempt investors are taxed on proceeds from leveraged investments (i.e., any buyout deal, or investments on margin). As a result, many tax-exempts invest through cayman corporations to avoid the tax (the corporation blocks the negative tax effect). This bill is an attempt to bring these investments back "onshore" by eliminating this tax, at least for "securities". There are important technical requirements that need to be met for this new beneficial tax treatment, but it's an auspicious bill. I will have a client alert on this Monday which I will link to here.

Lots of other small things too, but a big Friday for taxes.

The Death Update

Of course Pavarotti died the other day. God bless. Today, however, Madeline L'Engle, author of "A wrinkle in Time passed away. She was 88. Basically, if you've ever been in 4th grade, you've read this book, even though it was repeatedly rejected by numerous publishers. Funny story, the TaxWife presented this book (actually the whole series (!)) when she was a skirt-wearin' catholic school kid and apparently repeatedly mis-pronounced the O'Keefe family as the "O-Keefe-eys". whoops. Apparently the teacher was a bitter repressed, um. woman. Anyway, the obit is here.