Not really a surprise, given August's already reported retail sales slump in the US, but new figures for August show personal spending down, incomes down, and inflation up.
``This was bad, but September is going to be terrible,'' said Christopher Low, chief economist at FTN Financial in New York. ``Consumers are clearly shaken badly by the storm.''
And winter with record natural gas prices is just around the corner.
.
Free Wi-Fi and a top quality BLT can be found at the Trailhead Restaurant and Coffeehouse on Highway 58 in Oakridge, OR. Just saying that if your wife is researching a 44 year-old filicide and has allowed you to tag along on her road-trip, and you're feeling a bit peckish, this is a good stop to make
In combination with a Terminal Gravity IPA, the BLT is a glory. I also hear that the iced tea goes well with the Turkey and Brie sandwich.
The Commerce Department said this morning that the US Gross Domestic Product grew at an annualized rate of 3.3% for the second quarter of 2005 (this on the heels of a 3.8% annualized rate for the first quarter). And USA Today online had a really dumb headline about it, declaring "GDP flat". I guess maybe the headline writer thought it was flat because it had been unrevised from the previous Q2 estimate.
I heard a couple of finance industry economists yesterday projecting, without a great deal of conviction in their voices, GDP growth for 2006 in the 3.5% - 4% range. We shall see, but with interest rates rising across the curve, energy prices biting everybody in the wallet pocket, and that all-important American consumer beginning to back off a bit, durables notwithstanding, it certainly doesn't seem a sure bet. A cold winter with record heating prices is just one torpedo that could sink that kind of growth.
Yesterday, Durable Goods orders showed some strength and today, jobless claims backed off a smidge from their post-Katrina highs, though some people, workers included, are still spooked by this morning's report.
Next week, I hope to have some year-to-date asset class returns in celebration of the end of the quarter, as well as a summary of where economies in different regions of the globe are said to be heading.
Journalist Laura Rozen deftly explains today's Tom Delay indictment in today's Village Voice article, What's the Deal With the Tom DeLay Indictment?
Meaty Excerpt:
A press release from the Travis County District Attorney's office summarized the charge against DeLay as follows:
The indictment charges DeLay with conspiring with [James] Ellis and [John] Colyandro to violate the Texas Election Code by contributing corporate money to certain candidates for the Texas Legislature. It describes a scheme whereby corporate, or "soft" money, was sent to the Republican National Committee where it was exchanged for "hard" money, or money raised from individuals, and sent to those candidates. Criminal conspiracy is a State Jail Felony punishable by six months to two years in a State Jail and a fine of up to $10,000.
Specifically, D.A. Ronnie Earle has accused TRMPAC of receiving $190,000 in corporate donations, sending the money to an arm of the Republican National Committee for the express purpose of having it sent back in the form of campaign contributions to seven Texas GOP candidates running in the 2002 state elections. “The corporate fundraising," CBS reported earlier this year, based on an interview with Earle, "was done to elect Republicans to the Texas legislature so they could redistrict the state and ensure that more Republicans would be elected to the house in Washington."
. . .
Larry Kudlow could be seen jizzing his drawers on CNBC today following Alan Greenspan's unseemly reversion to the Ayn Rand discipleship of his youth. Greenspan's paean to the beauty of the free market came during a television address to a gathering of the National Association of Business Economics.
The Chairman also employed his dreary monotone to warn, ""History cautions that extended periods of low concern about credit risk have invariably been followed by reversal, with an attendant fall in the prices of risky assets." Um, fucking duh?
Speaking of that, sales of new homes fell 9.9 percent last month, but prices still managed to rise by 2.5 percent from July. Interesting data points for bubble trackers, especially when combined with yesterday's report of a surge in existing home sales for the same period.
Jason Leopold has written quite an article on the Frist mess. Excerpt:
In fact, Frist had attempted to have it both ways since he created his so-called blind trust in the 1990s: being intimately involved with his investments that directly conflict with his political work as a senator and then claiming that he’s totally unaware of his personal financial investments—and stock sales—because it’s in a blind trust.
The mainstream media, quick to accept Frist’s statements that he’s been in the dark about his HCA holdings, was complicit in allowing the obvious conflict of having a senator who makes national decisions on healthcare that directly benefit the senator’s fortunes and that of his family, fall off the radar screen.
The Conference Board's index of Consumer Confidence shocked on the downside this morning. Various mouthpieces are blaming Hurricane Katrina and energy prices, but nobody is fingering the other obvious culprit: Americans were jolted, courtesy of the disastrous Bush Administration response to the hurricane, by the realization that the country is being "run" by a starting line-up of Michael Browns, backed by a very deep bench of Michael Browns.
And that sort of epiphany is a bummer, not only for citizens but also for consumers.
Sept. 26 (Bloomberg) -- U.S. Senate Majority Leader Bill Frist said he did nothing wrong in selling shares of HCA Inc. before a weak earnings report and pledged to cooperate with probes by the Justice Department and Securities and Exchange Commission.
``I acted properly,'' Frist, a Tennessee Republican, told reporters in Washington. ``I had no information about HCA or its performance that was not publicly available.'' . . .
``Senator Frist had no control over when the shares were sold through the mechanism of a blind trust,'' Call said.
Frist ordered the trustees to sell his shares on June 13, one month before the company said second-quarter profit would miss earnings estimates. The trustees notified Frist on July 1 that the shares had been sold.
Huh? He had no control, but he ordered the sale of HCA? And he had maintained since 2000 that he didn't know that he owned HCA? This is only the bare outline of this very weird story that Frist is telling (and that he'll probably get to tell to the SEC Enforcement Division, and to investigators from the US Attorney's office for the Southern District of New York). More later.
_ _ _
Later: Interesting paragraphs from an MSNBC Report:
Blind trusts are designed to keep an arm’s-length distance between federal officials and their investments, to avoid conflicts of interest. But documents suggest that Frist knew quite a bit about his accounts from nearly two dozen letters from the trust administrators.
Frist, R-Tenn., received regular updates of transfers of assets to his blind trusts and sales of assets. He also was able to initiate a stock sale of a hospital chain founded by his family with perfect timing. Shortly after the sale this summer, the stock price dived.
Marketwatch tells us that Vanguard hopes to offer a new dividend index fund and ETF come September.
Vanguard investors and ETF fans loving the "equity income" category will have another alternative to Barclays' DVY (Dow Jones Select Dividend Index Fund), which may have confused a lot of people by its index re-jiggering last year, and the ETF offerings from Powershares.
Equity income really hit its stride with the passage of the dividend tax cuts (which tax cuts have not had the anticipated huge effect on corporate dividend payouts, and which tax cuts have helped increase our massive federal budget deficits, but that's another discussion), and the asset class became a favorite of marketing teams throughout the financial services industry. Some tax-savvy investors hold their higher yielding stocks and equity funds (not including REITs, whose dividends are not favored by the tax cut) in taxable accounts, since the dividend taxes they pay on the taxable accounts are now lower than the income taxes they pay on distributions from tax-deferred accounts.
Tax considerations aside, the value of dividend-yielding equity investments in enhancing overall portfolio return has been a popular topic of discussion of late, and dividend-paying equities were championed very persuasively by Wharton's Jeremy Siegel in The Future for Investors.
From Reuters:
Sep 26, 2005 — WASHINGTON (Reuters) - Christopher Cox, chairman of the U.S. Securities and Exchange Commission, said on Monday he has recused himself from an SEC probe of sales of stock in hospital company HCA Inc. by Senate Majority Leader Bill Frist, a former congressional colleague of Cox.
"The staff of the Securities and Exchange Commission have commenced a review of sales of HCA stock by a blind trust established by the U.S. Senate Majority Leader," Cox said in a statement.
"Because of my service in the congressional leadership for the last 10 years, I have recused myself in this matter," he said.
Cox's campaign committee donated $1,000 to Frist's 2000 re-election campaign, according to Federal Election Commission records made available by PoliticalMoneyLine, a non-partisan group that tracks money in politics.
. . .
I guess this means that Cox is not going to hassle the hell out of Linda Chatman Thomsen and her crew.
Bloomberg reports politely on the latest manifestations of the residential real estate frenzy. At least I wasn't the only one who was surprised.
Sept. 26 (Bloomberg) -- U.S. sales of previously owned homes unexpectedly surged to the second-highest level on record and prices reached an all-time high in August, spurred by job growth and interest rates within a percentage point of historic lows.
Existing home sales rose 2.0 percent to a 7.29 million annual pace last month from a revised 7.15 million rate in July, the National Association of Realtors said today in Washington. The median price rose 15.8 percent to a record $220,000 and the supply of homes for sale rose from the previous month.
. . .
The increase in median home prices in August was the strongest rate of appreciation since July 1979. Economists surveyed by Bloomberg News expected home resales would fall 0.6 percent to 7.12 million from July's previously reported 7.16 million pace. Estimates ranged from 7 million to a high of 7.4 million.
Two slightly different ways of expressing what's going on here:
``We have some way to go before we get into a range of balance between home buyers and sellers,'' said David Lereah, chief economist for the Realtors' group. ``As a result, we will continue to see above-normal home-price appreciation for the foreseeable future.''
Contrast:
``Home resales are surprisingly resilient in the face of rising energy costs,'' said Chris Rupkey, senior financial economist at Bank of Tokyo-Mitsubishi Ltd. in New York. ``The froth in the existing home sales market continues, and buyers are trading homes like they once did internet stocks.''
Doesn't anybody care any more when (far future) tax dollars are just thrown away like this? As Laura Rozen has been asking about other matters all weekend, where is the oversight?
Eric Lipton and Ron Nixon report on the latest in a long long series of Bush squander scandals in the New York Times:
More than 80 percent of the $1.5 billion in contracts signed by the Federal Emergency Management Agency alone were awarded without bidding or with limited competition, government records show, provoking concerns among auditors and government officials about the potential for favoritism or abuse.
Already, questions have been raised about the political connections of two major contractors - the Shaw Group and Kellogg, Brown & Root, a subsidiary of Halliburton - that have been represented by the lobbyist Joe M. Allbaugh, President Bush's former campaign manager and a former leader of FEMA.
My strategic asset allocation is a bit of of mishmash of models provided by Burton Malkiel in the last edition of A Random Walk Down Wall Street and Jeremy Siegel in The Future for Investors, and some independent "efficient frontier" analysis, along with considerations forced by my own personal circumstances.
As we head into another market week, with oil prices backing off a bit, and some relief over Rita's relative mildness (vs. Katrina) abutting a dour and unsettled national mood (and with reads on the real estate market coming Monday and Tuesday), I'm happy to put forward for scrutiny where I am and where I want to be in my personal investments:
9/25/05 target US Stocks 40.41% 38.00% reits 9.67% 10.00% int'l 25.12% 26.00% prv stock 3.53% 3.00% bonds 17.86% 22.00% cash 3.41% 1.00%
Perhaps this pre-formatted text won't please all browsers, but you get the idea, and maybe that will do until I decide to produce some nice pie-charts for the next update.
So what about it? The private stock is an accident of my employment. My 401k is my largest pot, and it's actively managed with a home-country bias (a tiny 10% allocation of the stock portfolio dedicated to international equities), and less of a regard for the diversification and income benefits of REITs than my strategy indicates. So in my IRAs, I'm buying chiefly international stocks (split amongst EAFE regions and emerging markets) and REITs. Note that when possible, my various asset pots are invested in low-cost indexed mutual funds or ETFs.
My bond portfolio gets really chump-changy, but its composition pleases me greatly in this environment when open-market bonds are poised to lose value as interest rates rise: more than a third of my bond portfolio is in US Savings Bonds, split between old-style floating EE bonds and the newer inflation-indexed I bonds. The I bonds, in particular, are paying very well these days. And the principal of these savings bonds, though it may succumb to other threats, is not subject to the whims of the bond market.
I'll unveil another asset allocation strategy, from the portfolio of a relative with a less complex circumstance, hence a more versatile strategy, later.
How poignant. Alan Greenspan, early champion of the now infamous Bush tax cuts (back in the day when the Bush/Hastert/Frist spending spree was really getting going), now laments (to a Frenchman, no less) that the US has lost control of its deficits:
"'We have lost control,' that was his expression," Breton told reporters after a bilateral meeting with Greenspan.
"The United States has lost control of their budget at a time when racking up deficits has been authorized without any control (from Congress)," Breton said.
Please pass the Failure Fries.
My best to my friends protesting tomorrow against the idiotic, supremely destructive US war on Iraq. Shout out in particular to those who made the pilgrimage to my old beloved home of Washington, DC.
A poignant reminder of another protest, back when we thought we still had a chance to stop the insane drive to war, which, as so many of us understood at the time, was obviously predicated on outright lies:
Thanks to Verity for this souvenir of the day our Catalan friends shut down La Rambla.
Uncertainties prevail in the economy, and in projections of corporate earnings, so I''ll look at some fairly conservative estimates for earnings to try to make a call on where US stocks are today. Here is my latest crude spreadsheet on this; the earnings estimates are from Thompson Financial.
The S&P 500 closed today at 1215.19. If we look at the "as reported" earnings for the past twelve months for that big basket of stocks ($71.40/share), we calculate a price-to earnings ratio of 17.02, right in line with the average P/E of 17 since 1960 (Jeremy Siegel), though a little higher than S&P's reported average of 15.65 since 1935. By these measures, the US stock market seems to be in "fair value" range, and certainly represents a good value for investors when compared with the stock market from the more recent past.
When S&P's very strict "core" earnings are projected for the current calendar year, we achieve a slightly fattier P/E ratio of 18.63 for the current market. Current year "as reported" earnings, still more conservative that the 12 month forward estimates, let alone the inflated 12 month forward "operating earnings" projections, brings in our lowest P/E ratio of 16.42.
Not too bad. But there are a couple of sticking points: in spite of all of the excess corporate cash we keep hearing about, the dividend yield on the S&P 500 is still just a measly 1.7%, hardly the lofty percentage projected by the advocates of the dividend tax cut, and well below the long-term average of the US stock market.
Ed "Y2K" Yardeni is fond of using 12 month forward operating earnings to make some rather bullish (recently, anyway) projections about where the stock market will be in the near future. After all, contends Yardeni, investors discount the future, not the past.
But as we've seen earlier in the week, and as Steve Roach reiterated this morning, the future is where the uncertainties and the potentially huge problems are. So I'll take the earnings that are in the pocket, for now, stay invested with diversification across asset classes, try to keep my wits about me, and hope for the best while trying to prepare for the worst.
Online banking pioneer Ing Direct has turned five years old. And they have bumped their Orange Savings Account rates up to 3.4%, lagging the Fed by 35 basis points.
Upstart Emigrant Direct is now offering a bold 4% for their own no-fee savings accounts.
Q: With FDIC-insured rates like this, and with five- and ten-year Treasury note rates bracketing 4%, how much sense does it make to buy any of of what our President likes to call "worthless IOUs?"
HCA documents have been subpoenad, apparently in the Frist matter.
Later: More details from Bloomberg:
The SEC ``contacted Senator Frist's office after the story appeared in the press about the sale,'' spokesman Bob Stevenson said in a statement. ``The majority leader will provide the SEC any information that it needs with respect to this matter.'' HCA said it ``intends to cooperate fully.'' HCA spokesman Jeff Prescott said today that the information in the subpoena indicated that the probe relates to Frist's stock sale. He declined to comment further.
That seems about right for Christopher Cox's SEC. They investigate the trade after the story appears in the papers. Kind of like George Bush's hurricane response, where he decides to so something after somebody shows him a DVD of TV news reports. And a tangentially related tidbit to that note, via The Washington Note: looks like Hurricane Czar Karl Rove will be doing some political fundraising in North Dakota when Rita hits Texas.
Par for the course.
My bus pass, my walking shoes, my bicyle, and my Prius are the strongest holdings in my portfolio.
Rita and the Oil Rigs: An Interactive Map
Like most people, I hope for the safety and health of everyone down there facing that. (If you don't say something like that while talking about an economic aspect of something like a hurricane, even in the context of an econo-blog, many will assume that you don't care about people and that you only care about the price of gasoline. To cop a line from the first President Bush, Message: I Care!).
Listen to what's coming out of the IMF. Is that Steve Roach's broken record they're playing? Global economic imbalances are more ratcheted than ever, leaving the world economy extremely vulnerable to what were once fairly localized issues, a slump in US consumer spending, for instance.
Americans were already beginning to rein in their spending pre-Katrina, pre-Rita, pre-$3 gasoline, and consumers' (somewhere along the line, 1980 maybe, "consumers" supplanted the word "citizens" as the descriptor of Americans) grumpiness accounts for most of the downturn in the Index of Leading Economic Indicators. This very morning, these consumers find themselves being kicked around by natural disasters, a multitude of new layoff announcements, and the prospect of a winter with record home energy costs.
If these consumers get kicked much more, they may find themselves to be citizens in a world of enduring hurt.
Remember July 24, 2002, when the S&P 500 hit an intra-day low of 775? I do, because that was the day I saw a seasoned investor finally lose it, and place a bunch of "sell" orders on good solid stocks that he had held for a long time.
This champion of the previously gloat-worthy American-style capitalism and its vaunted, unparalleled "transparency," had finally lost confidence in the institution that he had crowed so loudly over for so long. The mendacities of Meeker and Blodgett hadn't gotten this investor to this point. The shell-game accounting fraud of Enron hadn't gotten this investor to this point. But the massive and shocking misstatements by Worldcom finally sent this guy over the edge. And he sold many stocks close to the bottom of their multi-year values, reaping himself some nice losses, and including himself in the big club that locked in their losses from the $8.5 trillion slide in American corporate market value.
Ironically, but not surprisingly, I found myself butting heads with this same doctrinaire gentleman a few months later while discussing the merits of proposals by former NYSE head Felix Rohatyn involving greater regulatory scrutiny of corporate representations to shareholders and the public. The ape regards his tail. Repeats until he fails.
Worldcom's Bernie Ebbers is supposedly soon to be off to the big house (though he just won another delay of his sentence), and today some of his helpers, the usual suspects at Citigroup and elsewhere, were asked to shell out just a little bit too:
AP Reports on the Worldcom settlement
Sept. 21, 2005
NEW YORK - A federal judge Wednesday approved legal settlements that will return more than $6.1 billion to investors who lost money in the WorldCom accounting fraud.
. . .
The largest chunks are a $2.58 billion payment by Citigroup Inc. and a $2 billion payment by JPMorgan Chase & Co. Investors claim the companies, which were among those that underwrote or traded WorldCom securities, should have been aware of the fraud.A federal judge has approved settlements worth more than $6 billion in civil lawsuits related to the WorldCom accounting fraud.
My goodness.
Jonathan Katz reports for the AP:
Senate Majority Leader Bill Frist, a potential presidential candidate in 2008, sold all his stock in his family's hospital corporation about two weeks before it issued a disappointing earnings report and the price fell nearly 15 percent.
Frist held an undisclosed amount of stock in Hospital Corporation of America, based in Nashville, the nation's largest for-profit hospital chain. On June 13, he instructed the trustee managing the assets to sell his HCA shares and those of his wife and children, said Amy Call, a spokeswoman for Frist.
. . .
To keep the trust blind, Frist was not allowed to know how much HCA stock he owned, Call said, but he was allowed to ask for all of it to be sold.
. . .
HCA -- formerly known as Columbia HCA Healthcare Corp. -- has been a top contributor to the senator's campaigns, donating $83,450 since 1989, according to the Center for Responsive Politics.
. . .
Frist's father, Thomas, founded the company (HCA), and his brother, Thomas Jr., is a director and leading stockholder. The family is worth $1.1 billion, according to Forbes magazine.
Mindy S. Lubber, who understands that corporate earnings don't mean much on a dead planet, has a piece in the September 29 , 2005 Pensions & Investments magazine that is an eye-opener about the forces pushing global corporations to face up to their roles and responsibilities vis-a-vis climate change. Excerpt:
Climate change and emerging limits on greenhouse gas emissions pose new challenges for global companies and investors. Whether it's cars in China, aluminum in Europe or electric power in regions of the United states, the carbon footprint of goods and services made by US companies is becoming a bigger competitive factor.
The financial risks from global warming are growing every day. Scientists expect global warming will increase the frequency and intensity of extreme weather events - - and, in fact, already might be doing so. Last year's spate of hurricanes in the U.S. caused a record $30 billion in insured losses and this year's toll could be substantially higher because of Hurricane Katrina alone. . . [C]atastrophic losses from drought, wildfires, hurricanes and other extreme weather events have grown 10 times faster than premiums since 1971 [and bigger losses in the years ahead are predicted] if climate change trends continue.
Regulatory changes also are affecting global companies, whether from tighter auto emissions standards being pursued in Canada, China and California, or greenhouse gas reduction measures imposed in Europe and elsewhere under the Kyoto Protocol. So serious is the climate change issue that Swiss Re, a major reinsurer, has suggested that it will cut directors oand officers liability coverage for corporate clients that don't come up with appropriate strategies for handling global warming risk.
Lubber goes on to detail possible investor recourse to these concerns, including scrutiny by individuals and investment managers of corporate risks in such a changing climate, and potential rewards of "clean" investments. She goes on to write
These global warming resolutions are not about doing what is environmentally sound. They're about prudent financial and strategic planning that will enhance long-term shareholder value.
A compelling case. Clearly the actuaries get it. Will investment managers and corporate boards? Lubber is with Ceres and the Investor Network on Climate Risk.
Also in the action-packed Sept 19 PI, an item demonstrating that "socially responsible" funds (Domini 400 Social, Citizens Index Fund) have beaten the market (and, by extension, most active portfolio managers) over the past 10 years, and a distressing note that pension funds may be taking too much risk for middling returns in the trendy private equity asset class. Subscription required for PI online access, unfortunately.
One percent is a very popular number for economists who are projecting a GDP slowdown. A recent note from a regional Fed office carried a calculation that gasoline prices, made higher though circumstances both pre- and post-Katrina, would effectively shave one percent of US annual GDP growth in the near term.
About a month ago, I read a note from another economist who had calculated that the rise in crude oil prices (which are, of course, not the same as gasoline prices, though crude prices provide a significant input to gasoline prices) already sustained through the course of the year would, you guessed it, shave one percent off of annual US GDP growth.
Interestingly, I saw the same economist the other day on one of CNBC's worst shows (I know, how do you even distinguish?) claiming that Katrina would shave one percent from US GDP growth.
As whatever remaining hatches there are are battened down against Hurrican Rita, now expected to blossom into a Category 4 hurricane Wednesday afternoon, one wonders just how all of these one percents overlap. Yes, a Venn diagram would be helpful.
As predicted by analysts and futures markets, the FOMC raised its ovenight funds rate to 3.75% today.
The Fed statement referred to Hurricane Katrina and acknowledged that the storm's devastation posed short-term problems for the economy, but apparently Greenspan believes that the underlying dynamics of the economy will get us past any ruts or soft patches created by the storm. The FOMC reiterated its belief that inflation, excluding useless stuff like food and gasoline, is under control, but reiterated its intention to fight inflation at the core level.
Text of FOMC Statement (Bloomberg)
Is the Fed still worried that the job market is strengthening, in spite of recent, rather anemic, reports on job creation? Maybe not worried, just vigilant:
"With underlying inflation expected to be contained, the committee believes that policy accommodation can be removed at a pace that is likely to be measured." That old line. It'll be interesting to hear that all parsed by the CNBC screamers. Meanwhile, I didn't hear any indication of an intention to pause hikes.
I haven't gauged the impact of the move on the year end Fed Funds futures contract, but as of an hour ago, the markets were pricing in a year-end fed rate 4%.
On a tangential note, probably the worst commentary I heard on Hurricane Katrina, that didn't come from the White House itself, was from a renowned economist who advised subscribers in a note following the hurricane that a Katrina-induced failure by Congress to make the Bush tax cuts permanent could result in devastation equal to or exceeding the devastation caused by the hurricane itself. Ridiculous, surprising, and a bit disgusting.
Mindful of the crony contracts, and of our tax expenditures, this contract watchdog was demoted:
September 13, 2005
The Corps recently demoted Bunnatine Greenhouse—a top-level civilian employee who was responsible for ensuring the Corps follows competitive bidding requirements—after she accused the Corps of giving KBR improper influence over the contracting process.
http://www.tompaine.com/articles/20050913/watch_whos_cleaning_up.php
White House OMB Chief of Procurement Oversight Busted for Federal Property Scheme with Scumbag Lobbyist, Lying to Investigators, Obstructing Justice
September 19, 2005
The affidavit filed in support of the criminal complaint alleges that from May 16, 2002 until January 10, 2004, Safavian served as Chief of Staff at the GSA. During that time he allegedly aided a Washington D.C. lobbyist in the lobbyist's attempts to acquire GSA-controlled property in and around Washington, D.C. In August 2002, this lobbyist allegedly took Safavian and others on a golf trip to Scotland.
The false statement and obstruction of the investigation charges relate to Safavian's statements to a GSA ethics officer and the GSA-OIG that the lobbyist had no business with GSA prior to the August 2002 golf trip. According to the affidavit, Safavian concealed the fact that the lobbyist had business before GSA prior to the August 2002 golf trip, and that Safavian was aiding the lobbyist in his attempts to do business with GSA
Since Nov. 29, 2004, Safavian has served as the administrator of the Office of Federal Procurement Policy at the Office of Management and Budget.