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8:30 AM Friday, February 24, 2006: There are three ways looking at the "yield" you get from a muni bond. This is an actual example from a buy I made yesterday. It is a NY State Thruway -- AAA/AAA bond, maturing in 2018.

1. Yield to maturity 4.08%.
2. Yield to call 3.88%.
3. Current yield 4.60%.

Many bonds have a potential "call date," this one in 2015. If interest rates are lower n 2015, the Thruway will buy my bonds back and issue ones with a lower interest rate. The current yield is physically what I'm getting in cash each year -- not taking into account the value of the bonds at maturity or at call. The current yield assumes that in 12 years (or whatever the maturity of the bond is), I'll be dead and someone else will worry about the principal. Meantime, I can live on the 4.6% interest.

Obviously, whether it's 4.08% or 4.60%, the return on these bonds sucks. I'd be far better off in equities, real estate, hedge funds or whatever. The issue is not the miserable return, it's safety, diversification and comfort. If the world collapses tomorrow, I can live on the interest of these bonds. Nothing else I have pays cash as consistently. And cash is as good as money.

These rates are also triple tax-free. No federal, state or city taxes. Which means effectively, they're a little higher.

A reader highlighted Nuance Communications: It has gone up.

The reader pointed out two weeks ago, Nuance bought Dictaphone and on February 8, Nuance said:

"Nuance Communications Inc., a maker of speech-recognition software, will buy Dictaphone Corp. for $357 million to expand in health care and speed the automation of patient information dictated by doctors.

Dictaphone supplies speech-recognition systems to the health-care industry, Burlington, Mass.-based Nuance said in a statement.

Nuance hopes to eliminate most manual transcriptions of patient information by implementing Stratford, Conn.-based Dictaphone's speech-recognition capability. Dictaphone has dictation and transcription software systems in more than 4,000 hospitals and outpatient facilities, serving about 400,000 doctors, the statement said.

The deal will add $80 million to $85 million in revenue in the 2006 fiscal year, and $180 million to $200 million in the 2007 fiscal year. It will generate cost savings of $20 million to $25 million a year, according to Nuance."

CHECK. CHECK. CHECK. IBM had "Think." I have "CHECK." Items:
+ A lawyer asked to send him an important fax yesterday afternoon. He emailed me this morning saying he hadn’t received it and thus things were slowing down. He checked his fax machine. It was out of paper.
+ Brokerage statements are often wrong, usually in their favor. Check.
+ I once received a new laptop with 2 gigabytes of memory in two slots, each of one gigabyte. Turned out many months later when I checked, only one of slots was working and I really only had one megabyte.
+ Set up a CHECKlist for all your tasks and follow it. I have a list of six tasks I need to do when I've written this column, including spellcheck and backup. Some days I "forget." Stupid, lazy.
+ Check that when you announce a new product, you can actually deliver it. Toshiba announced a new laptop, the Tecra M5 a few weeks ago. I got excited and tried to buy it yesterday. No luck. The company won't even take order for it for another month or so. (I kid you not. It's that vague.)

This makes me very sad. From this morning's New York Times:

BAGHDAD, Iraq, Feb. 23 — After a day of violence so raw and so personal, Iraqis woke on Thursday morning to a tense new world in which, it seemed, anything was possible.

The violence on Wednesday was the closest Iraq had come to civil war, and Iraqis were stunned. In Al Amin, a neighborhood in southeast Baghdad, a Shiite man said he had watched gunmen set a house on fire. It was identified as the residence of Sunni Arab militants, said the man, Abu Abbas, though no one seemed to know for sure who they were.

"We all were shocked," said Abu Abbas, a vegetable seller, standing near crates of oranges and tomatoes. "We saw it burning. We called the fire department. We didn't know how to behave. Chaos was everywhere."

Of the seven men inside, at least three were brought out dead, said Abu Abbas, 32, who said it would be dangerous to give more than his Iraqi nickname.

Everything felt different on Thursday morning. A Shiite newspaper, Al Bayyna al Jadidah, used unusually angry language in a front-page editorial: "It's time to declare war against anyone who tries to conspire against us, who slaughters us every day. It is time to go to the streets and fight those outlaws."

Getting sillier and sillier:

WASHINGTON, D.C. - A white house source stated that Congress is considering awarding Vice-President Dick Cheney the Medal of Freedom, the national highest civilian commendation, for his act of bravery in shooting an attorney. The source was quoted to say " All Americans have wanted to shoot a lawyer at one time or another and Cheney actually had the balls to do it". In a related story, the Texas Parks and Wildlife Department, which issues hunting licenses, said that it will start requiring hunters, wishing to bag a lawyer, to have the new "lawyer's stamp" on their hunting license. Currently Texas hunters are required to carry stamps for hunting birds, deer, and bear, at a cost of $7 annually. The new "lawyers stamp" will cost $100, but open season will be all year long. The department further stated that although the "lawyers stamp" comes at hefty price, sales have been brisk and it is believed it will generate annual revenues in excess of $3 billion dollars the first year. Other states are considering similar hunting license stamps.

Reverse logic:
"Susan, please close the window over there. It's cold outside."
"Harry, if I close the window, will it get warm outside?"

I went to a store to buy some insecticide. "Is this good for beetles?" I asked the clerk.
"No," he replied. "It'll kill them."

A nice pun:
An attorney specializing in personal injury decided to branch out, so he added libel claims to his practice. He wanted to add insult to injury.

Picking horses:
Two buddies were watching the game when one turned to his friend and said "You won't believe it. All last night, I kept dreaming of a horse and the number five. So I went to the track, put $500 on the fifth horse in the fifth race, and you won't believe what happened."
"Did he win?"
"Nah," the guy said. "He came in fifth."

Overwhelmed: If you haven't heard back from me on Strategic Commodities fund, you will. I've been overwhelmed.


Harry Newton

This column is about my personal search for the perfect investment. I don't give investment advice. For that you have to be registered with regulatory authorities, which I am not. I am a reporter and an investor. I make my daily column -- Monday through Friday -- freely available for three reasons: Writing is good for sorting things out in my brain. Second, the column is research for a book I'm writing called "In Search of the Perfect Investment." Third, I encourage my readers to send me their ideas, concerns and experiences. That way we can all learn together. My email address is . You can't click on my email address. You have to re-type it . This protects me from software scanning the Internet for email addresses to spam. I have no role in choosing the Google ads. Thus I cannot endorse any, though some look mighty interesting. If you click on a link, Google may send me money. Please note I'm not suggesting you do. That money, if there is any, may help pay Claire's law school tuition. Read more about Google AdSense, click here and here.
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