Maria Shriver Throws a Great Party for over 11,000 Girl Friends (and one Supreme Court Justice).

by Natalie Pace, founder and CEO, NataliePace.com

Jane Fonda, First Lady Maria Shriver and Sandra Day O'Connor P hoto Credit: California Governor and First Lady's Conference on Women and Families, Susan Goldman.

Last year, at the California Governor and First Lady's Conference for Women and Families, you knew why you were there: to see Oprah up close and personal. How many times in your life do you sit before one of the most powerful women in the world, and listen to her candidly testify to the source of her greatness and reveal all of the personal secrets that she believes keeps her on top. Not only that, but, to be impassioned by Oprah's sermon, which was as fiery as any ever delivered by Martin Luther King, while surrounded by the awe and wonder and energy of 10,000 women, these are once-in-a-lifetime experiences that ignite your soul. It's hard to top an Oprah Winfrey keynote, but leave it to California First Lady Maria Shriver to outshine the sun she brought to Long Beach, California last year.

So how did she do it? The line-up included Sandra Day O'Connor, Deepak Chopra, Carly Fiorina and Barbara Walters, among numerous leaders and legends. Maria also eliminated (most of) the politics from the event. Arnold was absent all day, until the early evening, when he surprised everyone to deliver a congratulatory speech to the recipients of the 2005 Minerva Awards. As Maria noted in her welcome speech, "Neither one of my parents changed anyone's life through elective office. Neither one of my parents changed anyone's life by being rigidly partisan, or by working only with one faith or one color." It was a theme sounded throughout the day - service, inclusion and the active creation of a better world.

The keynotes and the session of the conference were designed to educate and empower each individual to realize the power of individual acts in overcoming prejudice and adversity. Every color, creed, intelligence, income strata, sexual orientation and gender were represented in Maria's outstanding list of speakers: from Tom Brokaw to Gayle King, from Katie Cortelyou (an inspiring woman with intellectual disabilities) to Mary J. Blige, from Isabel Allende to Billie Jean King.

Ann Fudge, CEO, Young & Rubicam, in a passionate, teary-eyed call to action, was the first to acknowledge the powerful, simple act that changed our world on December 1, 1955. "Nearly 50 years ago, [Rosa Parks] didn't get up," Ms. Fudge said. "As I grew older, I realized just how much that single event by one woman changed my life. I wouldn't be standing here today if it weren't for that one solitary action." Anne Sweeney, the most powerful woman in Hollywood according to the Hollywood Reporter, challenged the 11,000 women attending the conference, saying, "We share the right and responsibility to do something meaningful with our lives. Everyone here has the power to change the world by making our own corner a better place."

4 Call to Action points of First Lady Maria Shriver:

1. Help children who are living in poverty. 1 in 5 children live in poverty in CA. 3 of the poorest cities in the nation are in California.
2. Build playgrounds. $28 Billion alone is spent on obesity related illnesses in California, according to Ms. Shriver, who challenged everyone to "create playgrounds for children who have no safe place to play. Ask your businesses to build playgrounds for kids all over this state."
3. Prepare for Disaster. "We live in a disaster prone state," the First Lady said. "If we have learned anything from Katrina, it is that we cannot rely on government alone. Make a disaster plan for yourself and your family. Talk to your children. Introduce yourself to your neighbor next door. When disaster strikes, we're all in this together."
4. Reach across partisan lines and prejudices to make a differenceÑsomething Maria and Arnold have to do every day in their marriage! Though Maria proclaims that she is "pro-choice and pro stem cell research," she also acknowledges that she is "the Kennedy that married a Republican." Maria said, "Our struggles unite us all. There is more that unites us than divides us."

Though the event was attended by more than 11,000 women, there were more than a few men in the audience. As Jane Fonda pointed out in her delightfully candid speech, "The opposite of patriarchy is not matriarchy. It is democracy." And so it was that so many women (and a few brave men) took a day off from their jobs, as parents and/or as employees, to collectively network and dialogue on how to make their lives and their world a better place. Though it is hard to imagine how Maria and her team will do it, we all look forward to October 2006, for yet another inspiring day.

Administaff: the Antithesis of Enron.

by Meri Anne Beck-Woods, Chairman and COO of Odyssey Advisors LLC

Q&A with Paul Sarvadi CEO of Administaff.

Administaff, symbol ASF is a NYSE listed company whose stock is up over 210% year to date as of October 14, 2005. Closing price 12/31/2004 $12.61, Closing price October 14, 2005 $39.10. (Source Bloomberg LP)

Business Overview:

Paul J. Sarvadi Chairman and Chief Executive Officer, Administaff

Administaff is the nation's leading Professional Employer Organization (PEO), serving as a full-service human resources department for small and medium sized businesses throughout the United States. Administaff delivers its personnel management services by entering into a co-employment relationship with a client company and the client company's existing employees, including the business owner. Under this arrangement, Administaff assumes or shares many of the responsibilities of being an employer. As of December 2004 ASF had 38 sales offices located in 21 markets.

Like a Phoenix rising from the ashes, Administaff has come full circle. The stock, which reached an all time low closing trade price of $1.99 per share in September of 2002 recently hit a 52 week high on October 4 2005 of $40.94. (source Bloomberg LP). Administaff CEO Paul Savardi answers questions about taking the high road and why good corporate governance leads to growth.

Meri Anne Woods: What impact has Hurricane Katrina had on Administaff and your clients and how do you expect it will affect the economy and ASF's growth in the 4^th quarter?

Paul Savardi: Hurricane Katrina was a tragic event for the Gulf coast; however Administaff dodged a bullet in that we have no offices in New Orleans and very few of our clients were impacted . Although we had to evacuate our corporate headquarters in Texas, it gave us the opportunity to evaluate our disaster recovery programs for our clients, our employees and the community. Administaff personnel went into the shelters and helped survivors put together resumes, which were then forwarded, to our employer customer base to match companies with workers suddenly out of a job. As far as the impact on the economy and our growth, our business owners are still moderately optimistic regarding the economy. The impact of the spike in gasoline prices remains to be seen, as does the rise in inflation. Our business owner clients are most concerned about rising health care costs, increased competition, rising fuel costs, employee retention, and regulatory and compliance issues.

What would you like shareholders, clients, and employees to know about the decision you made to absorb a large percentage of a vendor's price increase in 2001? Rather than pass it on to your client business owners, Administaff took a $25 million earnings hit.

The specific issue was the failure of a key vendor to honor a contract. Administaff did not want to be in the position of not honoring client contracts by passing through the price increase immediately, instead of at the annual renewal. We felt that in addition to not being honorable we would most likely lose many of our clients, if we did. The basis of our corporate values is, "If the values are not right, the corporation will not be right". Although the price of our stock dropped, our employees knew they worked for an honorable company and redoubled their sales and marketing efforts. To the extent that we were able to give out stock options during that time, our employees were given options at the lower end of our stock price range.

Note: On October 30, 2003, a jury returned a verdict in the lawsuit between Aetna Life Insurance Company, Administaff's former health insurance carrier, and awarded ASF $15.5 million in damages. The award was subsequently reduced on appeal, but contributed significantly to 2003 earnings per share.

As you may know, my company Odyssey Advisors LLC has been an Administaff company for over 5 years. One issue of concern to me was the apparent lack of transparency in pricing. For example, since our company paid 100% of employee benefits, we did not have a cost basis breakdown between the service fee, taxes and health and insurance benefits. Is that an issue with other clients?

There are two very good reasons why we charge a total percentage fee--bundling all of our services--as we don't want to compete with our client business owners, and it would be counter to the legal framework of the company employee relationship if we acted as agent for the employer. This would transfer the liability back to the employer client company from Administaff. It's analogous to buying a new car. When you buy a new car, you really don't know what the tires cost. You are interested in the price of the whole car and not the specific parts. Administaff is a turnkey one-stop shop for human resource benefit services business model.

It appears ASF has transitioned from a low priced value stock at under $2.00 per share in 2001 to a high PE growth stock at current valuations of 52x average analyst's earnings estimates of just under $1.00 per share for 2005. The range in analysts' estimates for ASF growth going forward are +30% on the high side to +10% on the low side with the mid range 20-25%. (Source I.B.E.S. earnings estimates) With the implementation of the dividend in 2005, will ASF be an income stock as well going forward?

Administaff is and continues to be a genuine ""growth company". ASF has built a positively leveraged infrastructure. We can grow the top line 50% more than our operating expenses due to technology and volume purchasing of health and insurance benefits. We expect 30% to 40% revenue growth is doable as there are 600 thousand companies that fit out sweet spot for client owners of service, financial, administrative and other companies with limited employee injury risk and higher paid employees . We currently do business with only a small percentage of our potential domestic market. The best psychographic fit for us is the best small businesses in the country. The ones who consider their employees an asset rather than a liability and deserving of the best possible benefits and employer resources to better fuel company growth.

What would you estimate the difference in cost between a company that handles their own human resource and benefit programs versus an Administaff client company.

Our client company owners invest approximately 3-4% of payroll above hard costs for individual HR, payroll, attorneys, etc. This could be about $100 per highly compensated employee per month. The offset is the value of the client owner's time, his or her dedication to their true competencies and the value of being able to attract and keep key personnel.

Knowing how sought after your top business consultants are in the marketplace what kind of incentives can you offer in place of stock options for your key personnel?

Administaff prides itself on the people working for the company. Our top business consultants currently have no cap on what they can make in terms of residual commissions for companies brought into the Administaff PEO service program. For accounting reasons, we have recently ended the practice of giving company stock options to our employees. We will probably replace that benefit with a restricted stock program for key employees. This benefit may not be given to as many people in the firm as before. However, it will be easier for employees to put a correct valuation on the restricted stock than a pure stock option. In addition, employees earn points for business brought in and are encouraged to ask for referrals from existing clients who can also earn reward points. We are a very incentive driven company.

It is fair to say that unlike Enron, whose stock went from $82 in 2001 to 16 cents and then out of business in 2002, Administaff kept their word to clients even though the cost was extreme. ASF stock may have tumbled from $30.24 on January 31 of 2001 to $2.70 on August 30^th of 2002 (source Administaff) but if you kept on to the stock from there, you would be amply rewarded. Going forward, with institutional stock ownership currently above 90%, how loyal will shareholders be if ASF takes a long fall off the high road and cannot meet such high growth expectations. Short sellers have made bets against ASF that so far have not turned out well. ASF has scheduled its' next earnings release for November 1, 2005 to discuss the 3^rd Quarter of 2005, at 10:00 AM Eastern Time. We will be watching; stay tuned.

Meri Anne Beck-Woods is Chairman and COO of Odyssey Advisors LLC, an independent investment advisory firm specializing in eq1uity and fixed income management for individual's entrepreneurs, families, endowments, and non-profit stitutionsods@odysseyadvisors.com.

Information has been obtained from sources believed to be reliable however, Odyssey Advisors LLC does not warrant its completeness or accuracy. Opinions constitute our judgment as of the date of this material and are subject to change without notice. This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. Securities, financial instruments or strategies mentioned herein may not be suitable for all investors.

Sharing Wisdom: I've tried everything to expand my business and nothing is working! HELP!!.

In our monthly Sharing Wisdom feature, NataliePace.com subscribers get answers to questions about money, career, business, investing (and really what doesn't have an element of money to it). The collective experience, success and wisdom of the NataliePace.com circle can help you to follow the golden brick road to your dream life.

This month, a technology entrepreneur writes: "I have owned a technology consulting firm for five years and I have tried all year long to expand the business, hire employees, and win proposals.  NADA!  What else does it take beside energy and drive (which I am full of) to make it as your own company?" Kelley

1. Establish Your Niche, Get Referrals and Access Free Expert Advice

Patty DeDominic, Founder, CEO and Chairman of PDQ Services, Inc. Chairman, SCORE Foundation

by Patty DeDominic. Chair of the Board of the www.SCORE.org Foundation and the Former President, National Association of Women Business Owners  at www.nawbo.org.

As you know technology has been growing at the pace of a speeding bullet, stretching out wider than a tsunami.      How to find the ways to ride this wave now? My advice is to find your niche and get the word out about your expertise in certain areas... Is it business process improvement? Buying hardware?  Software solutions for publishing? Science?
 
Have your surveyed your past customers to find what they valued most about what you offered?  If you have satisfied clients, they may be your best source of referrals for new.  If you can't find many past clients who will give you testimonials after five years in business then you have another problem altogether.  

Survey your prospecting client niches to see what issues they recognize now as problems or anticipate in the future. Also try to find out who is currently serving this niche.  What do they offer that you aren't?  How are they targeting and winning over their clients? This should give you guidance as where your future contacts will come from.
 
Employees are almost a thing of the past for technology consulting firms. Perhaps you are ready to try a joint venture supplying your expertise as a subcontractor or prime contractor with another firm similar to yours.

If you would like more tips on hiring, please visit http://www.pdqcareers.com.

Remember you can get FREE on line or in person business advice from www.SCORE.org.   This 40-year old non-profit organization has a vibrant web service you can access 24/7 and get answers to specific and general business questions by experts who donate their time after agreeing to a strict code of ethics.

2. Balance

Kari, an NataliePace.com subscriber.

The one most important word of wisdom is balance! Sometimes we get so busy in wanting to get somewhere, to get to our vision, that we forget too see the baby steps we are taking to get there. We get so busy with the hustle of pulling it all together in our "work" selves that we forget to nurture the other parts of who we are, which are vital to the whole picture. We need to be still sometimes so that we can see the work we are actually doing. Be still to be open to the process. Count your blessings. Have fun. And then "not succeeding" is not an option!

3. Networking and Marketing

Maryann Johnson, Director of TV Music Administration 21 year veteran at 20TH Century Fox Studios.

by Maryann Johnson, Director of TV Music Administration and a 21 year veteran at 20TH Century Fox Studios.

An essential key to a successful business is NETWORKING and MARKETING. You have to establish awareness of your company, senior executives and services. The people who use your type of services in the community, have to know you're there.  When I say iPod, you know it's Apple. When I say Bill Gates, you know he's head of Microsoft.

Volunteer on committees. Join the Chamber of Commerce. Attend conventions. Senior Executives need to be visible. Know your area politicians and events.  Introduce yourself to the key participants and let folks know your availability. You can work with local radio station promotions and give away a free consultation. Churches are another good source. They have newsletters and newspapers. Participate in some of their activities. There are also schools in your area. Do seminars.

4. Supply and Demand

Diane Conti, President of VIP Meetings & Conventions.

by Diane Conti, president of VIP Meetings & Conventions.

Diane founded her business at age 41 after a 20-year career in the aerospace industry as a "rocket scientist". She has built an extremely successful company by combining technology with personalized service. VIP Meetings & Conventions provides full service convention management to corporations and associations.

If your attempts at expanding your business are unsuccessful....there are some fundamental questions you should ask yourself.  Yes, drive and hard work are important, but are you really providing a service that others want and need? Believe it or not, many companies are formed offering services that the founder thinks are terrific, but there is no real market of any size to support their
enthusiasm.   I do not know what business you are in...but first it has to
be something that is in demand with a large potential market.  

If you have competitors that are beating you out, do some intelligence gathering. Why are you losing the business? What is it that your competitors are doing or offering that you aren't? What can you do to distinguish yourself from your competition?  When you lose a piece of business, ask why.  I have found that people are usually willing to share that information.  Use that feedback to adjust your strategy and/or products/services and pricing.  Bottom line.......working harder is not enough...working smarter is essential.

5. Brainstorm

Lynn Rosenberg.

After losing her husband to skin cancer, Lynn Rosenberg created "UV Protection with Style" ... small, lightweight, beautiful UV-Sun Umbrellas that are endorsed by MDs. Check them out at Soleil Chic.

If you've brainstormed yourself silly, start storming someone else's brain.

6. Peer Advice

Rosemary A. Bova Founder and President of Bova Enterprises, Inc.

by Rosemary A. Bova. Rosemary Bova is founder and president of Bova Enterprises, Inc. Advisors to Management, a consulting firm specializing in Leadership, Team and Organization Development to create requisite companies.  

It is extremely difficult to be in business.  Many businesses fail in the first five years and we don't necessarily hear about them.  It's like acting.  Most actors struggle throughout their life; only a handful becomes stars.  Go to NAWBO.org and learn about the National Association of Women Business Owners.  Membership provides access to thousands of women business owners who are willing to help another member address a business problem or concern.  

Sometimes women hesitate to ask for help, but other women have addressed similar business problems.  It's like motherhood.  Women who have raised children have dealt with the same situations as a new mother.  It's more acceptable to ask about breastfeeding or the terrible twos than it is to ask about how to grow your business.  It's harder to admit you may be doing something wrong in your growth strategy.  The NAWBO network of women business owners is an invaluable network to help you look at your business decisions.  We as women business owners must support each other so that we can create economic security for our families and ourselves and build viable, profitable business entities.  

Next month's question comes from a 21-year-old young man, who is interested in investing and is wondering which steps to take next in his career. He has his real estate license, has read the Rich Dad, Poor Dad series and has even dabbled in junior college and multi-level marketing. In his own words, Dennis writes:

I've watched my parents and how they live, comfortably yes . They have their needs, but not their wants. I've watched them struggle with bills, arguments etc all over money, and I don't want myself or my family to go through that. I don't necessarily like working "for" other people, but I love working "with" other people. I'm tempted to go after my series 6 license, but I'm still walking down a dark road and have no idea where to go. Anyone got a map?

If you have a pithy, tacit answer for Dennis, please forward your response to info@NataliePace.com before November 15, 2005. We will be compiling your responses for Dennis and for an article in the December 2005 ezine. Please note that, in the interest of space, we will not be able to publish all responses, and can only consider those responses that are received by 11.15.05. Thanks in advance for sharing your wisdom with our readers.

The Joy of Stocks,

as told by Virgin Investor, Jodi Seidler

Jodi Seidler

What people like about me most are my desire to learn and my ability to keep growing, past my comfort zone.  Hence, I decided it was time to get into the stock market.  I consider myself a highly intuitive person in my civilian life - but my BIG question was - does this transfer into the world of stocks and bonds?  I clicked my heels three times and said, "There is no place like IRA" and then I dug in my heels, palms sweating.  I researched via YAHOO finance. I asked questions of a retired stockbroker friend (and date) of mine. I registered with Schwab.com (a favorite of my dear old dad), and I visualized myself as wealthy from my investments.

As an entrepreneur and website(s) owner (http://www.makinglemonade.com is a community for single parents), I know from my son-the-teenager that http://www.myspace.com is a hot property. (We all must have real estate on the web.)  So, I researched and I did my due diligence with trusted investors.  I read what Natalie Pace had to say about MySpace.com as well, and THEN I jumped.  It happened the week before my 51st birthday, the day after I had a dream that the stock would become famous.  I pushed the buy button and buckled my virgin-investor seat belt.  I was NOW a stockholder with a dream, with a piece of the proverbial pie.  I am a tech girl by nature, so I am drawn to tech stocks because that is who I am.

So was my dream a prophecy as I had felt?  Was I as foolish as my left-brained broker-mentor told me I was?  Well, all I can say is take your worst nightmare and add a pitch of "told you so" and you'd have what happened next. Three days following my brilliant purchase of MIX stock, Elliot Spitzer (feel free to GOOGLE him for more info) sued my savior stock for a series of [alleged] Wall Street crimes and the stock fell like a ride at Magic Mountain.  I panicked, I lost sleep, and I even sought advice from a psychic.  

Not only could I not sleep at night, I had enough hot sweats to give men-o-pause a new name.  Had I been too quick to push the BUY button?  As I entered the "Should I stay or should I go" syndrome - all I could hear were the echoes from the past, from a 'long-forgotten-due-to-therapy' chorus of  "what were you thinking" in my ears.  Had I indeed been better off putting all of my money on 23 black on the roulette wheel?  I laid in bed thinking of all the ways I could have spent that forsaken investment.... five month's rent, a trip to New York or Paris, plus those outrageous pair of boots I had cooed over in 'In Style' Magazine.  

I felt lost and stupid and alone in my 'woe is me world'.  I HAD to talk myself back into the world of grown-up, where we acknowledge our mistakes and move on.  But, why couldn't I move on?  I still felt a tinge of a possible "comeback"; after all, this is Hollywood - the land of the comeback.  If only I could only hang on to the belief in turnarounds and magic.  I needed to hang on to my hopes and dreams of the American way.  I know, as a single mom, I am a Superwoman, but truth be told - I cannot leap tall buildings or truly predict the future.  But I CAN follow my hunches and choose to truly feel that in some cosmic way I did buy a piece of something I believe in.  And, I do believe in building community on and off line, and I do believe in owning a piece (and hopefully peace) of  Wall Street.

And then I called Natalie Pace.  She shared with me, the novice of novices, stories and analogies from her history files - and I found the meaning inside those stories.  One of the stories she told me was of a woman who was going to get out of the stock market and take a large loss at a time, in October 2002, when the markets were at a 5-year low. Natalie explained that education is always better than panicking and that the markets were at a 5-year low.  Historically, she explained, it is not a good idea to sell low, unless you're talking about an Enron or a Global Crossing.   The woman hung on, the market came back and she became very happy she stayed in the market.  

Natalie's story brought home to me the point to NOT be fueled by emotions when it comes to selling; and that to "know when to hold 'em/know when to fold 'em" comes very much into play in the market and not just in the realm of relationships.  I learned, from the story that it is best to have a clear, non-emotional head and to know what comes down can come UP (and vice versa).  That assurance gave me a breath and a knowing that if I just sit on my hands and breathe - I will be able to see much more clearer what to do. Waiting and watching and educating myself really helped during this period.  Also I learned NOT to listen to any one else's advice to "get out NOW".  After all, it is MY money and my very own vision of the stock and company I bought into.  

I held on.  I gathered a buddy system through YAHOO stock newsgroups that had also invested in this myspace.com/MIX phenomenon - so I was not alone.  I am a hand holding kind of girl! What was funny was that the stock HAD become famous - even infamous, as in my dream, but not for the reasons I had assumed.  Like a celebrity who gets in the papers with their name spelled correctly, my stock had its month in the limelight. And NOW because of Spitzer, people KNEW about MIX and myspace.com. Just a few short months after Rupert Murdock (you gotta Google him too) decided he needed to own myspace.com (to capture the 14 - 36 plus demographic) - the stock soared, and so did my hopes and dreams!

Albeit, I didn't make enough for Sam's college education or that car he wants, but I did prove to myself that with some moxie, education, a buddy system ... PLUS some dollars - I CAN make a difference in my finances and empower myself to continue this exciting financial journey in the stock market. I made a lot of money (to me) for what was really a very short period of time.  Although my hope was that someone else would out bid this Mogul (which did not occur), I still gained a real presence of confidence and gratitude that I was brave, strong and confident enough to follow my dreams.  

Most of all I built a trust in myself that I can, with careful study and the help of gurus, build a solid portfolio and a trust in myself that no one can infiltrate.  I am a proud "winner" in the stock market with a success story that makes me proud, and one I can share with other virgins wanting to dip their toe in the market waters.  With my current proven confidence that I can make it though the Wall Street Dark Night of the Soul, I have a newly anointed knowing that with education, staying power and some guts - I can continue to invest...in myself, my future and in our country.  And now, I can even translate and deliver those dreams to my son, so he can create his future as an entrepreneur.

Can it get any better than that?

Jodi Seidler is the founder of the leading single parent information site MakingLemonade.com, and the author of 55 Things Every Divorcing Mom Should Know! Jodi not only has extensive experience writing, speaking and coaching single parents but is also extensively experienced in helping women find their voice and career path and market it to the outside world. Feel free to connect with her at: Jodi@makinglemonade.com

Inspiring Quotes from 10 Powerful Leaders.

From the California Governor and First Lady's Conference for Women and Families, held on 10.27.05 in Long Beach, California.

First Lady Maria Shriver, Tom Brokaw, Linda Ellerbee, Barbara Walters, Isabel Allende and Billie Jean King Photo Credit: California Governor and First Lady's Conference on Women and Families, Susan Goldman.

1. Ann Fudge, CEO, Young & Rubicam
Nearly 50 years ago, [Rosa Parks] didn't get up. As I grew older, I realized just how much that single event by one woman changed my life. I wouldn't be standing here today if it weren't for that one solitary action.

The best way to predict the future is to create it. Think about how you're going to create your future and our collective futures for stronger communication, and lord knows, a much better world.

2. Anne Sweeney, co-chairman Disney Media Networks and President ABC TV Group. The most powerful woman in entertainment, according to the Hollywood Reporter.
There is a direct link in what we are able to achieve and the amount of risk we are able to take. I take the job that scares me the most.

If we're afraid to leap, we can't expect to fly.

Everyone here has the power to change the world by making our own corner a better place.

3. Jane Fonda. Hollywood legend. Political activist.
If the paradigm of society was circular, not hierarchical, we'd all be sitting across from each other, no start, no finish. Oh, that's women's way.

Men aren't even allowed to be depressed, which is why so many engage in self-numbing, from sex, to gambling, to workingÉ

How many young men have died because of our leaders fear of premature evacuation. (on Lyndon Johnson's fear of being called an unmanly man if he pulled out of Viet Nam.)

The opposite of patriarchy is not matriarchyÉ It's democracy.

4. Barbara Walters. The Godmother of network news. Owner/Producer of The View.
Not everybody has children. If you don't have children it doesn't mean that you are not fulfilled. If you stay home and you decide not to work, that's okay. And if you do work, and you are ambitious, don't put yourself down because you have ambition or drive. Nobody complains when a man does.

My slogan has always been: Just do your job and don't whine.

5. Sandra Day O'Connor. Supreme Court Justice.
It took 191 years to put a woman on the Supreme Court. I think that was a little long to wait. It's important that citizens of this country see in all areas of our government structure that women are represented there.

At the end of the day, in the questions in which we address on the court, a wise old woman and a wise old man will come up with the same conclusion.

I couldn't get an interview. Here were all these notices asking Stanford law grads to apply for an interview. I would call and I couldn't get an interview scheduled. (On graduating 3^rd in a class of 102 at Stanford and not being able to find a job.)

I think if you start at a low rung in the office, you're the one who finds out the facts, and figures out what to do about issues. Someone starting at the bottom can be very effective in finding ways to move on up.

I put all my energy in at the front end, reading everything I can. I then reach a decision and I don't look back. I think a judge's job is to make decisions. If you were second guessing every decision you made, you couldn't live that long.

6. Maria Shriver. First Lady of California, wife of Governor Arnold Schwarzenegger, granddaughter of Joe and Rose Kennedy, niece of John F. and Robert Kennedy.
Neither one of my parents changed anyone's life through elective office. Neither one of my parents changed anyone's life by being rigidly partisan, or by working only with one faith or one color. (Sergeant Shriver founded the Peace Corps and Maria's mother, Eunice Shriver, founded the Special Olympics.)

7. Billie Jean King. 6 Wimbledon championships. 4 U.S. Open championships. #1 women's tennis player in the world for five years. In 1973, she beat Bobby Riggs, while 50 million people watched around the world. Life magazine named her one of the 100 most important American in the 20^th Century.
Title 9, besides the vote, besides civil rights, was the most important piece of legislation in the 20^th century. I was pre-Title 9. I wasn't able to get an athletic scholarship to college because of my gender.

8. Linda Ellerbee. Producer of Lucky Duck Productions, with 55 employees, and 15 years on Nickelodeon doing children's programming. A writer/producer/adventuress.
At Lucky Duck, we've had women who decide to have children and continue working. Others decide to have children and not work. By the way, staying home is still working. Others find a way to work from home with their young children. Because my company is run by a woman, I'm aware that they ought to have those choices. Men have always had choices because they had a wife at home.

9. Isabel Allende. In 1973 she was driven into exile, from a military coup in Chile, with her husband and young children. Her first novel, The House of Spirits was published to great acclaim.
As women get empowered and educated and get access to contraception and education, they become leaders. Every time the religious fundamentalists or the political fundamentalists gain control, women get put down.

10. Carly Fiorina. Former Chairman and CEO, Hewlett-Packard.
When the worst thing you can image happens, life goes on. When my mother died, I thought that was the worst thing I could imagine, but the sun comes up the next day. You are fired publicly and the whole world has a field day with it. I got through it because of the unwavering support of my husband, who is here, and my family. The sweet part is that I now have the opportunities that I never had time to do before. I can write a book. Spend time with my family, my husband. There's a lot more to life than corporate America.

We will have a woman President, but that doesn't mean that there aren't real barriers, real prejudices. Women frequently lack the presumption of competence. When a man is in a leadership position, everyone assumes he is competent. Sometimes it takes people a long time to figure out that this guy doesn't know what he's doing. The burden of proof rests with the woman. You have to prove that you are competent.

There are people who focus on the limitations of the situation, and there are people who focus on the possibilities. The people who focus on the possibilities always achieve more. See what's possible!!

Freakonomics

review by Patrick A. Fraioli, Jr.

What do you get when you cross a witty, successful, freelance writer with the self-described "world's weakest man" - the guy who has to ask his wife to twist off the top of the pickle jar for him? Why, a book, of course! Freakonomics is the first book by both men, and it is a great read. More importantly, investors can learn quite a bit from this book.

So, what exactly is Freakonomics?
"Economics", we are told, "is, at root, the study of incentives: of how people get what they want, or need, especially when other people want or need the same thing." (Page 20.) Freakonomics, on the other hand, applies an economist's analytical tools to whatever freakish curiosities the analyst may have. (Page 14.) Let's be clear: Levitt and Dubner are not sitting around wondering whether cutting the capital gains tax rate will generate investment. No, they want to know What Do Schoolteachers and Sumo Wrestlers Have In Common? (Answer: they both cheat). How is the Ku Klux Klan Like A Bunch of Real Estate Agents (Answer: they both use secrecy to keep power). Why Do Drug Dealers Still Live With Their Mothers (Answer: because the vast majority make only as much money as they would working at McDonald's).

You do not have to be a sumo wrestler or a real estate agent to be pissed off by the conclusions drawn by the authors. For example, Chapter Four has already angered the entire pro-life lobby, because Levitt's conclusion after reviewing the data on the otherwise unexplainable, massive drop in crime in the 1990s is that it is largely the result of - are you ready for this? -- the legalization of abortion by the Supreme Court in Roe v. Wade almost twenty years earlier. How, you say, is that possible? As always with the man who was voted the equivalent of the under-age-40 Nobel Prize in Economics, the data tells the tale.

Here's a brief summary of the book's most provocative chapter. In 1990, the U.S. Government and all criminal justice pundits braced for an oncoming, massive wave of violent street crime. A new, inner city, "super-predator" would be spawned on our streets by the confluence of an anticipated population explosion and the ubiquity of crack cocaine. The streets, we were told, would run red with blood throughout the 1990s. But, then, a funny thing happened on the way to the bloodbath: crime began dropping - suddenly and dramatically - and kept on dropping every year in the 1990s in virtually every jurisdiction in the nation. Why? How could every expert be so spectacularly wrong? Enter Steven Levitt, Ph.D. Ever the contrarian, Levitt plows through the boatload of explanations offered by the so-called experts: strong economy, community policing, gun control, etc. None can explain the breadth or the magnitude of the drop.

The answer is remarkably simple. Immediately following Roe v. Wade, every state in the Union legalized abortion (it was legal in a few states already), and millions of women had abortions. Generally speaking, "Éthe very factors that drove millions of American women to have an abortion [poverty, single-parent household, low maternal education] also seemed to predict that their children, had they been born, would have led unhappy and possibly criminal lives." (pp.138-139.)

The conclusion is far from elegant, and quite different from any of the myriad theories of crime prevention touted by the media. The key is that Levitt starts with the data and finds a conclusion, not the other way around. The authors explain their findings, noting:

The point is not whether or not you agree that abortion is apparently the most powerful crime-control device ever invented, or even what impact this conclusion should have on the abortion debate in this country. Levitt is willing to leave those decisions to the country's political and moral leaders. The point is that the data tells the tale; all you have to do is mine it and avoid preconceived notions. And that is exactly why investors, of all people, need to read this book.

What Can Investors Learn from Freakonomics?
The lessons for investors are many. First, ask questions. Follow your curiosity, even if it is as freakish as Levitt's. Your life experiences give you a unique perspective that may give you an edge over the herd (this is reminiscent of Peter Lynch's famous investment strategy). Second, do not simply accept the conventional wisdom regarding an investment. Ask why it is so, and whether the entire class of pundits whose opinions comprise the conventional wisdom have a vested interest in maintaining it. Third, pose a hypothesis and test it. Review the data, for example, of all the investment decisions you have made in a particular period or of a particular type. Look to see if there are any patterns. Did you jump at "story stocks" or media darlings that later got crushed (remember B2B)? Did you follow the experts and learn later that they were simply perma-bulls? Or, perhaps are you the kind of person who tries to catch falling knives? Look and see how many you "caught" and how many sliced you up.

Of course, all of this assumes you keep or have access to such data in the first place, and that you are willing to analyze it without pre-judging it. If the data is not there, it cannot be mined, so keep track of your investments and the conditions under which you made them. Finally, be rigorous in your analysis. Know the difference between correlation and causation. And don't make excuses. Know thyself or, more importantly, trust the data and thus learn about yourself. In the long run, it is what will enable you to make your best investment decisions.

Patrick Fraioli, Jr. is a partner with the law firm, Moldo Davidson Fraioli Seror & Sestanovich LLP, located in Los Angeles, California.

Celebrities, Style and Parties.

by Natalie Pace

While You Dream of the Good Life, Your Future Could be Cat Food.

It's tempting to read fluff, especially after a hard day's grind. I'm just as likely to pick up the latest headline on Vince and Jennifer or Bennifer and Brangelina as the Financial Times before boarding a long flight, and I know that the last thing you want to hear at the end of a hard day is that your pension plan may be in peril. You may think it's like the War in Iraq, tragic, but out of your control, and, as with the war, you might be dead wrong.

Global Crossing. Enron. United Airlines. All of these companies have bankrupted their pension plans over the last three years, and this is not surprising given the demographic of the U.S. today, when almost a third of our population will start retiring in 2008. With Delta and Delphi in bankruptcy, it could be imperative that you determine whether or not your pension plan is next in line. Blue Chips and pension plans are becoming endangered species these days, and those of you who work for companies founded before 1980 may be at risk of eating cat food in retirement, if you don't protect (roll over) your retirement plan now.

As an example, General Motors, whose pension plan is being formally investigated by the Securities and Exchange Commission, has a current stock market valuation of $15.69 billion. According to Standard and Poor's, the pension plan liabilities of General Motors equal $107.440 billion, with only $99.909 billion in assets. That means the pension plan is -$7.531 billion underwater. It was enough to catch the attention of the SEC, which is also informally investigating the pension plan accounting of Ford and Delphi. According to the Standard & Poor's Pension Plan Report, which was issued in July of this year, Ford Delphi and General Motors are all in the top ten list of companies that are in the most trouble with their pension plans, along with Exxon, IBM, Delta Airlines, Lockheed Martin, Boeing, Raytheon and Dupont.

These companies aren't the only Blue Chips that have pension plan obligations in the red. According to Standard and Poor's, of the 369 companies that offer defined benefit plans, 311 are currently underfunded. "The underfunding stems from a combination of low interest rates and specific accounting methodologies designed to smooth out market volatility," according to David M. Blitzer and Howard Silverblatt, co-authors of the Standard & Poor's S&P 500 2004 Pension Status Report. "Unfortunately, these same accounting rules often conceal the current condition of funds for several years," the authors note.

How vulnerable are companies with underfunded pension plans and what kind of risk are employees and investors taking on by investing in or working for these companies? The airlines industry is unfortunately the best example of the difference between the legacy costs (pension plans) of old and new companies. United Airlines, US Airways, Northwest Airlines, Delta Airlines and more have filed for bankruptcy in order to slough off or reduce the benefits and wages of their employees, in an attempt to stop losing money. American Airlines is still operating in the red, while newer airlines, like JetBlue, which do not have the legacy costs of the defined-benefit plan (and offer 401K "savings accounts" that employees are responsible for instead), have posted profits for a record 19 straight quarters, even with record high fuel prices.

In other words, blue chips with defined-benefit pension plan that used to be the stalwarts of Wall Street have become the most vulnerable - to both employees and investors alike. The S&P report of companies that owe money to their pension plans include such stalwarts as Hewlett-Packard, Altria, AIG and more.

40 of the S&P 500 companies that are most deeply in the red on pension plans.

Source: Standard & Poor's (July 2005)

Employees run the risk of having their entire retirement plan wiped out, as employees of United Airlines, Global Crossing, Enron and more have personally suffered through. Investors run the risk of having worthless stock, if a company can no longer compete due to the legacy costs of pension plans.

In short, companies which were founded before 1980, when companies took on the responsibility of pension plans and guaranteed retirement benefits to their employees, are far more vulnerable than newer companies, which define their contribution into their employee's retirement "savings account," without any guarantees of how much money will be there upon retirement. As James Barth, the Senior Finance Fellow at the Milken Institute explains, "Under defined benefit plans, individuals knew the minimum amount that they would receive. That's no longer the case. The investment returns can be negative, not even just being low. So that too means that individuals have to become more financially savvy."

The responsibility for the retirement plan in a 401K or IRA is placed solely on your shoulders (not the corporation) to make sound investment choices. Any losses that are realized are borne by the you, the cmployee, which is why a number of people were forced too continue working in 2001/2002, even though they had reached retirement age. In short, employees today are expected to get smart about investing, or risk going broke, and investors are smart to look beyond the headlines to examine the fundamental health of the corporation, beyond the earnings reports.

The sectors most likely to be impacted by pension plan liabilities are unionized and founded before 1980, and are more concentrated in: Materials, Consumer Staples, Energy, Industrials, Telecommunications and Utilities. Those sectors that are least likely to have pension plans in the red include: Information Technology, Consumer Discretionary, Financials and Health Care.

Getting financially savvy is not quite as sexy as Jennifer Aniston gracing the cover of Vanity Fair, but if you act now to get your nest egg in order, you'll have enough money in retirement to keep buying all those fashion magazines.

Other articles of interest:
1. Discount Brokerages Make Rollover IRAs Easy.
2. 10 Steps to Protect Your Retirement NOW.
3. NASD's Smart 401(k) Investing.
4. Brokers and Lovers: It Pays to Pick a Good One.

Inflation, the Price of Gas in China and 3rd Quarter Stock and Bond Performance.

by Paul Woods, President & CEO of Odyssey Advisors, LLC

Paul Woods, President & CEO of Odyssey Advisors, LLC

In the third quarter of 2005, the stock market finally got off its seesaw and added a second quarter of positive but unexciting returns. In the process, stocks shrugged off hurricanes that did extensive damage, higher oil prices, the likelihood of a widening deficit, higher interest rates, the likelihood of more interest rate increases by the Federal Reserve, and the usual summer doldrums.

It may be that the Bureau of Labor Statistics has finally run out of ways to cook the books, but the reported inflation rate is now at the highest level in years and we still believe the actual inflation rate is significantly higher. The result has been more interest rate increases by the Federal Reserve, although increasing the cost of money to fight inflation is roughly equivalent to expecting gasoline to put out a fire. The demand for raw materials from China and India currently exceeds supplies, and this is the root cause of current inflation. Because of this, expecting higher interest rates in this country to have much impact on inflation is the equivalent of tilting at windmills. However, higher interest rates from this point could easily harm the real estate market and slow the economy further.

In the third quarter of 2005, smaller companies again outperformed larger ones, but this time growth mostly outperformed value. Energy and biotech produced double-digit returns while investors bet that, with higher energy prices, consumers would have less discretionary money. For reference, here's the stock market and industry group scorecard for the third quarter of 2005:

In addition, here's the equity market segment scorecard for the third quarter:

In the fixed income market, the yield curve remained flat, but rates across the board rose by low double digits. Last quarter we doubted that the Federal Reserve wants to see the yield curve become inverted (short term rates higher than longer rates), now we're not so sure. Since nothing good ever comes from an inverted yield curve, we keep hoping the members of the Federal Reserve will have an attack of common sense. Unfortunately, we keep remembering that we're dealing with government bureaucrats so we remain cautious on bonds and are keeping maturities short and emphasizing quality and liquidity in our bond portfolios.

Overall, we continue to expect economic growth to slow a bit this year. The higher cost of energy coupled with increasingly restrictive Fed policy will probably produce less robust economic growth in the second half of 2005. However, we see no signs of a recession on the horizon and expect corporate public relations departments to do a good enough job of sandbagging to keep earnings coming in ahead of expectations in the third and fourth quarters. Although stock market valuations are in the middle of their historic range, common stocks are still significantly undervalued relative to current interest rates and we continue to expect stocks to outperform bonds in 2005.

Paul Woods is the President & CEO of Odyssey Advisors, LLC, an independent investment advisory firm specializing in equities and fixed income. He can be contacted at www.odysseyadvisors.com or 310.568.4700.

Information has been obtained from sources believed to be reliable however Odyssey Advisors LLC does not warrant its completeness or accuracy. Opinions constitute our judgment as of the date of this material and are subject to change without notice. This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. Securities, financial instruments or strategies mentioned herein may not be suitable for all investors.

Putting Too Much Stock in Your Company - A 401(k) Problem.

Jeff Skilling, President and COO; Ken Lay, Chairman and CEO Joe Sutton, Vice Chairman source: 1999 Enron's Letter to Shareholders

Investor Alert from the National Association of Securities Dealers
With major Enron and Worldcom trials completed or in the works, stories of employees losing some or all their retirement income are back in the news.  Now is a good time to ask yourself if you hold too much of your retirement nest egg in your employer's stock.

NASD is issuing this Alert because it is concerned that employees who have the opportunity to invest in company stock may be concentrating too much of their retirement savings in a single security. NASD is particularly concerned about employees who have all or most of their 401(k) assets in their employer's stock.  If the stock takes a beating, so does your retirement savings.  

No Restrictions Can Lead to High-Risk Investing
Currently, there are no restrictions on the amount of 401(k) assets that can be held in company stock.  While the Employee Retirement Income Security Act of 1974 (ERISA), restricts traditional pension plans (also known as defined benefit plans) from investing more than 10% of assets in company stock, there is no similar restriction on 401(k) plans.

Employees can direct a high percentage of their contributions to company stock, even if they are given other investment options.  Employer-matched contributions often come in the form of company stock, further concentrating holdings in employer stock. A study by the Employee Benefits Research Institute and the Investment Company Institute found that employees who have the opportunity to do so held more than 25% of 401(k) assets in company stock.  In the case of employees over the age of 60, almost 25% held more than half their 401(k) savings in their employer's stock.  Even more startling, 16% of employees over the age of 60 held more than 80% of their 401(k) savings in company stock.  The result: a non-diversified retirement portfolio that hinges to a large extent on the performance of a single stock.

Learning from History?
The fall of Enron Corporation focused attention on the potentially devastating effect of owning too much company stock. 57.73% of employees' 401(k) assets were invested in Enron stock as it fell 98.8% in value during 2001. But employees at many companies still have even larger percentages of their 401(k) assets in company stock than Enron employees did.

What Could Go Wrong If You Concentrate Retirement Savings in Company Stock?
Simply stated, if you put too many eggs in one basket, you can expose yourself to significant risk. 

In financial terms, you are under-diversified: you have too much of your holdings tied to a single investmentÑyour company's stock.  Investing heavily in company stock may seem like a good thing when your company and its stock are doing well.  But many companies experience fluctuations in both operational performance and stock price. Not only do you expose yourself to the risk that the stock market as a whole could flounder, but you take on a lot of company risk, the risk that an individual firmÑyour companyÑwill falter or fail.

Restrictions Can Limit Liquidity
There's another potential problem with concentrating too much of your savings in company stock. Your company may place restrictions on your ability to buy or sell the stock, or transfer it to another type of investment within your 401(k).  This limits the control you have on your finances.   

Employer-matched stock, in particular, often comes with restrictions.  Some companies require employees to hold the stock until they reach a certain age, or until a specified date.  This can spell trouble.  If the stock slides, you may be stuck on the sidelines without the ability to sell and limit your losses.

Lockdowns or blackouts can also occur. These are periods in which account activity is frozen, generally to perform administrative tasks.  Usually lockdowns are for a short duration (a few days to a few weeks), with employees given advance notice. Nonetheless, it's possible that a lockdown could coincide with a slide in company stock. This happened at Enron, when the stock declined more than 35% during a pre-scheduled two-week blackout.

How Much is Too Much?
The general consensus among financial experts is that an adequately diversified portfolio should have no more than 10 to 20% of total investment assets in company stock.  If you concentrate much more than that in company stock, especially in a 401(k) plan where there are trading restrictions, you may expose yourself to more company risk that it is wise to incur.  Of course, there is no single formula or percentage that suits all investors, so you should consult a professional about what the right mix of investments is for you.

If you are one of the 8 million participants in 401(k) plans who have more than 20% of assets in company stock, and this investment also constitutes more than 20% of your overall investment portfolio, you may want to consider re-balancing your investments to increase diversification. 

What is Diversification?
Diversification is an investment strategy for spreading your principal among different markets, sectors, industries, and securities. The goal is to protect the value of your overall portfolio in case a single security or market sector takes a serious downturn and drops in price.  In short, diversification spreads your risk, while still seeking a strong return on overall investment.  NASD's Smart 401(k) Investing learning center has additional information about diversification and rebalancing your portfolio.

Take Control of Your Financial Future
To achieve appropriate diversification, employees with company stock should consider doing the following:  

* Determine your total exposure to company stock. Be sure to include stock options, pension plans, employee-directed stock purchases and company matches in your total. You may have additional exposure to your company's stock through mutual funds in which your company is part of the investment mix. Many investors didn't know how fully exposed they were to technology and Internet stocks until the bubble burst in 2000 and they saw declines not only in their individual stock holdings, but in mutual funds that had investments in these same companies.  If your company stock holdings exceed 20% of the value of your total investment portfolio, you may wish to consider redistributing your assets across a broader spectrum of investment.* Know the restrictions, if any, on buying and selling company stock.  The more of your portfolio you have tied up in company stock with restrictions, the more risk you incur.

* Read your company's key SEC filings, including annual reports (10-K), quarterly reports (10-Q) and reports of material events (8-K).

* Use metrics such as betaÑa measure of the volatility of a stock relative to an overall market index during a given time periodÑto evaluate the level of risk your company's stock carries.  Employees whose company stock is subject to significant volatility or whose company scores high on other risk measures should be particularly wary of investing too large a percentage of their investments in company stock.

* Read analyst reports and other information from third-party sources to evaluate the short and long-term prospects of your company's stock performance.  Don't rely solely on your employer's advice or guidance for why you should invest in company stock.

* Maintain reasonable expectations of the performance of your company's stock. Striking it rich is hard to do, no matter how dominant or successful a company is.  All companies, even the most successful, have their ups and downs.

It's Your Retirement
Owning company stock does allow employees to share in the financial success of a company.  But it also carries the risk that a company's financial problems will become the employee's financial problems.  When it comes to investing for retirement, it's you, not your employer, whose financial security ultimately is at risk from overexposure to company stock.

In determining how much you should invest in company stock remember that your retirement is just thatÑyours!

Resources
For additional information on saving for retirement, read NASD's Smart 401(k) Investing.

To receive the latest Investor Alerts and other important investor information sign up for Investor News.

Other Articles of Interest:
Lessons From Enron: Power is Intoxicating. 11 Ways to Avoid Getting Drunk. by Natalie Pace, CEO & founder, NataliePace.com.

Do Good Corporate Ethics Make For Good Earnings?

by David M. Glasser

David M. Glasser

It would be nice to say that good corporate ethics lead to good earnings. However, history and statistics do not support such a declaration. While in some instances a company with positive ethical values shows a consistent good rate of return, it is more readily apparent that a company with poor ethical standards results in reduced earnings, stock value and consumer support.

Business Ethics Magazine annually publishes a list of the "100 Best Corporate Citizens". The list is determined by: return to stockholders and service to stockholders, community, minorities and women, employees, the environment, non-U.S. stakeholders and customers.

Fannie Mae (FNM), which had been on the list from 2000-2004, was number one in 2004. In early 2005, Fannie Mae announced it was conducting a reaudit and would be issuing an earnings restatement that may total as much as $9 billion.

From the end of 2004 until the end of September 2005, Fannie Mae stock dropped from $73.81 per share to $41.34 per share. That means if you had purchased 1,000 shares at the end of December, by the end of September, there would be a paper loss of almost $32,470.

We all recall the Enron debacle. If you had purchased 1,000 shares of Enron stock on January 26, 2001 for $82.00 per share, on November 30, 2001, each share would have been worth $.26. If you were looking for a tax write off, this would have been a good one. Your loss from that investment would have totaled $81,740.

What Is Ethics?
Defining (as well as complying with a code of) ethics is not as easy as it sounds. While general statements may find everyone in agreement, when specific issues and situations occur, differences of opinions as to how those issues and situations will be treated, will likewise occur.

There is no standard definition of ethics. Ethics is not a stationary concept. Like society, it changes over time. What is acceptable behavior in one era is not acceptable in another.

There may also be circumstances where a person understands he/she may be acting unethically, but they are acting for a "higher purpose". For instance, if a starving man stole to feed his family, society would look at that as being illegal and unethical. However, if that is the only way he and his family can survive, then to him, his actions are ethical because he is making certain his family does not starve. To others it may simply be rationalization of an illegal and unethical act. (We need only look at the recent Hurricane Katrina incidents where some people took food, water and diapers, while others took televisions, stereos, and other items having nothing to do with survival. Still others took nothing. A number of the network and cable talk shows discussed the ethics of whether it made a difference between the item taken and the reason it was taken).

A business' values (and thus its ethics) may be determined by its leadership, by society as a whole, by the community in which it exists, or by the government.

While one may act unethically without violating any laws, more and more, laws are being enacted that encompass ethical mores. Whether this is because of public disgust with the activities of a few companies or individuals, or whether it is a sign of the changing beliefs of society as a whole, is better left for another article.

Creating and implementing a code of Ethics
Simply creating a code of ethics is insufficient. An organization's values must be clearly stated and understood, and it is essential that an ethical culture must be established and promoted from top to bottom. For public companies that means not only having a code of ethics but living up to the code of ethics.

A code of ethics is not simply an internal record for an organization's employees. A code should be a significant tool in conveying to the public, potential employees, vendors, and anyone else who may have a relationship with the entity what it believes in and how those beliefs will be implemented.

A code should be part of a program to foster ethical conduct within a business. This includes on-going training, open communication and fair enforcement.

The benefits of adopting a code of ethics include: creation of an atmosphere where ethical activities are the standard; ethical considerations will become part of the decision making process; an opportunity to show the public a dedication to ethical behavior; and creation of a positive public identity.

The downside is if the business fails to live up to the code of ethics, public and consumer trust will thus be diminished. In addition, the ability to entice good people to work for the business may be damaged.

A code of ethics should not be created from the executives downward. It should also not be taken straight from other codes of ethics.

For a code to be workable, there must be consensus. This does not mean that everyone needs to agree as to its content. But employees should be involved in the evolution of the code. The code should reflect the nature of the business as well as setting forth its guiding principles.

A code of ethics should not simply be written and then forgotten. It needs to be easily understood. If people have questions, they should be able to contact someone without fear of losing their jobs. People should feel free to discuss ethical issues with co-workers, supervisors and ethics officers. These communications not only aid the person with the initial question, but also help others in formulating answers to ethical questions.

The code needs to be disseminated to the employees, and continually reinforced through training, seminars and actions of the executives of the business or governmental entity.

New employees should be provided a copy at the time they are hired and sign an agreement to follow the code.

The code should also be sent to vendors, and made available to the public. The business should provide the ability of vendors and members of the public to comment on how they believe the code is working. This gives additional insight that otherwise would not be obtained.

The code should also be regularly reviewed to ensure it is accomplishing its goals. If the goals are not being accomplished that could mean the code has set forth unrealistic expectations, positive ethical atmosphere is missing or some other reason that needs to be discovered so that the code is meaningful.

Employees should feel their jobs are safe if they report what they consider to be ethical violations. Otherwise, chances are ethical violations will go unreported.

Ethics does make a difference
While making decisions that are ethical may not be sexy in the sense that it will result in no headlines, the word does get out, and companies generally profit from their ethical attitudes.

In 2001, Administaff (ASF), the nation's leading Professional Employer Organization, had a difficult decision to make. Aetna Insurance, in apparent violation of its contractual obligations to Administaff informed it that insurance premiums would be increased immediately or the policy cancelled. Administaff could have possibly passed the increase onto its clients at that juncture or waited until the annual renewal with the clients. If it waited, the result was going to cost the company $25 million. If it passed the increase on immediately, it was bound to lose customers. Administaff decided to "bite the bullet" and honor its contracts with its clients and shouldered the $25 million expenditure itself.

While the stock took an initial tumble from $30.24 per share on January 31, 2001 to $2.70 on August 30, 2002, it has bounced back to over $39.00 per share in October 2005.

Herman Miller (MLHR), a manufacturer and distributor of office furnishings has a long history of ethical behavior as well as corporate awards and recognition. In 2005, the Michigan Minority Business Development Council named Herman Miller its Corporation of the Year in the commercial products sector for its ongoing efforts to create a diverse and inclusive supply chain. In 2004, for the 16^th time in 18 years, Herman Miller ranked as the "Most Admired" company in the furniture industry by Fortune Magazine. Also in 2004, for the fifth year in a row, Herman Miller ranked among Business Ethics Magazine's "100 Best corporate Citizens". It was also selected for the Dow Jones Sustainability World Index, an international stock portfolio that evaluates corporate performance using economic, environmental and social criteria.

Over the last two years, Herman Miller has shown an annual rate of return of 10.7 percent.

While monetary profit is important for any business entity, a company also profits from good public relations and the people it employees. In one study, it was found that three out of four people refuse to purchase from certain businesses, and business conduct was an important reason to avoid a business. [1997 Cone/Roper Cause Related Marketing Trends in "Does It Pay To Be Ethical?" Business Ethics (March-April, 1997):15].

Unpublished studies have shown a correlation between corporate responsibility and increased profits. In addition, it would seem logical that people would rather work for a business with high ethical standards. If people are happier in their workplace, they are less likely to look outside their work environment for other positions. This results in lower turnover, and fewer employee related expenses.

In addition, a business with a higher ethical value will be more apt to attract a higher caliber of employee.

Of course, a company still needs to produce and sell a product desired by the consumer. It doesn't matter how ethical a company is, if the product is not one sought by consumers, the business will not last.

But, in the end, there can be no doubt that good ethics makes good business sense.

David M. Glasser is a Managing Partner in the Law firm of Greenspan Glasser & Rosson, a principal in the firm Dispute Resolution Solutions and an adjunct professor teaching Business Ethics at UCLA Extension. Mr. Glasser can be contacted at dmglasser@ggrlaw.net.

Don't be Tricked by Good Earnings Reports.

by Natalie Pace, top-ranked stock picker, per TipsTraders.com

Natalie Pace, top-ranked stock picker, per TipsTraders.com

(Note: These are not buy/sell recommendations. Always consult a certified financial professional before buying or selling stock.)

Stats, Facts, Quotes and Educational Information:

Bottom Line: NataliePace.com is providing you with news and important information, but you need to consult your financial planner to determine your best strategy for using the information. That will depend upon your age, your retirement plan, and your risk tolerance and portfolio diversification. The stock portion of your portfolio is a higher risk classification, where you ideally seek to gain higher returns. As the NASD said in a recent investor alert, don't bet the farm on the stock market. NataliePace.com is NOT a brokerage and doesn't operate or act like one. We are an online media service with a mission of providing the news and information you need to make better choices in business, investing and personal prosperity. Always consult a trusted financial professional before buying or selling any security.

Full disclosure: I have listed the companies that I own under the column "NP OWNS?"

Hot Stocks
Investors who "never pay retail," note that highlighted stocks are trading at their 52-week lows or near the price featured in NataliePace.com's article. It may be a good buying opportunity. The companies that are listed below which are not highlighted may not be in a good buying range, but they (outside of KKD, which might be a real dud) are poised to continue performing well. There are never any guarantees in life, and all stocks are risk-based investments.

Stocks in Profit-Taking Range.
Note: We may still like these companies (as we do Genentech and Google) for the long term as companies (which means if you have them in your 401K or long term portfolio, you might want to keep them there), but are taking profits in shorter windows, based on a market that is posting modest gains, with volatile movements. We may look to add some of these great companies again, if the price point should become attractive. In a market of modest gains but high volatility, profits are made in shorter windows.

Advanced Micro Devices closed out 8.15.05 at $20.85, with 74.3% gains. ($21.37 10.17.05)

Genentech closed out at $80.92, with 328% gains. (10.17.05: $84.20)

Google closed out at $292.72, with 193% gains. (10.17.05: $305.00)

Jet Blue closed out at $19.27, with -9% losses. (10.17.05: $19.77)

Pixar closed out at $51.67, with 21% gains. (10.17.05: price $49.15)

Sirius closed out at $6.60, with flat performance. (10.17.05: $6.15)

Sony closed out at $34.50, with flat performance. (10.17.05: $33.46)

Please note: NataliePace.com does not act or operate like a broker. We are a media and information center. This article is intended to educate and inform individual investors, and, thus, to give investors a competitive edge in their personal decision-making. The publicly traded companies mentioned in this article are not intended to be buy or sell recommendations. ALWAYS do your research and/or consult an experienced, reputable financial professional before buying or selling any security.

Harvesting Profits on Firms That Farm Out Payroll and Benefits .

by Natalie Pace.

Article and Stock Report Card

Natalie Pace, founder & CEO, NataliePace.com

Meri Ann Beck-Woods, a small business owner and customer of Administaff (ASF: NYSE) (ASF: NYSE), is only one of a growing number of small business owners in the U.S. to turn over the servicing of their human resources and benefit plans. As you can see, by reading Meri Ann's exclusive Question and Answer with Administaff (ASF: NYSE) CEO, Paul Sarvadi, in this week's ezine, Ms. Beck-Woods holds Mr. Sarvadi in great esteem, as the "Anti-Enron" executive. But is that a good reason to buy stock in Mr. Sarvadi's company?

It turns out that now may be a better time to sell Administaff (if you're taking your profit in shorter windows). That doesn't mean that you can't make money or that you shouldn't invest in Administaff for the long term (ASF: NYSE). It simply indicates that -- according to our research criteria, which are centered on taking profits in shorter windows during periods of more modest returns, i.e. Today's environment -- now is a better selling than buying time for Administaff (ASF: NYSE). Administaff's share price has jumped over 200% since April of this year, based on a strong 2^nd quarter earnings result, which was reported on August 1, 2005. In fact, that selling opportunity point of view is shared by many of the corporation's executives, including CEO Paul Sarvadi, who has cashed in over six million since August of this year (source: MoneyCentral.msn.com).

A closer look at the 2^nd quarter results, which sparked the spike in share price, reveals that the share price may have been pushed up by investors who rely more on technical analysis, than on reading the fine print. According to an Administaff (ASF: NYSE) press release, which was made available on the day of the earnings announcement (full disclosure is a positive sign for the executive team), approximately $2.8 million of the increase in net income was due to moving the annual sales conference and sales incentive trips to the 1^st quarter from the 2^nd quarter. It will be interesting to see if these technical traders are patient enough to hold their shares if the 3^rd quarter earnings report, scheduled for November 1, 2005, reflects more modest growth. Certainly the insiders didn't wait to find out.

Although Administaff (ASF: NYSE) isn't NataliePace.com's pick to buy this month, the indicators of future growth for this PEO Sector have put two other companies on our radarÑnamely Gevity Human Resources (GVHR: NASDAQ) and Automatic Data Processing (ADP: NYSE). (Click on PEO Sector to view the stock report card.) According to the U.S. Commerce Department, small businesses represent more than 99 percent of all employers, and employ more than half the private work force. Small business entrepreneurs now create more than two out of every three new jobs and generate about 50 percent of the nation's economic growth.

The net profit margins of booth Gevity and ADP are significantly higher than Administaff's, at 6.6%, 13.10% and 1.8% respectively, and both Gevity and ADP have price to earnings ratios that are lower than Administaff's by more than half. Additionally, both Gevity and ADP have enacted recent business initiatives and alliances that portend auspicious growth. ADP is branching out into the brokerage business, while Gevity is partnering with major organizations, and has become the preferred HR Provider by the National Venture Capital Association (as of 9.12.05). Gevity HR was added to the S&P 600 Small Cap Index on 10.26.05, and since then, shares have been under heavy accumulation by financial institutions (a very positive sign).

Both Gevity and ADP score highly in the executive suite for managing growth through partnerships and product offerings, while keeping profit margins in tact. Which of the companies do small business owners prefer? We'd love to hear from you. Please email us at info@NataliePace.com with your comments.

While NataliePace.com's monthly featured company and stock report card are typically designed for that smaller active trading portion of your portfolio (one that you actively manage and limit your exposure on), with a sector like this that is likely to be in favor for the foreseeable future (or at least until benefit plans become a thing of the past), you might consider adding one or both of these companies to your nest egg as well. The dividends make the investment even more attractive.

Natalie Pace is not a broker, analyst or professional money manager. She is, simply, a journalist who specializes in investigative financial reporting, with an outstanding record of performance on the companies featured in her ezine, NataliePace.com.

Please note: NataliePace.com does not act or operate like a broker. We are a media and information center. This article is intended to educate and inform individual investors, and, thus, to give investors a competitive edge in their personal decision-making. The publicly traded companies mentioned in this article are not intended to be buy or sell recommendations. ALWAYS do your research and/or consult an experienced, reputable financial professional before buying or selling any security.

Calender...

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