Sunday, December 25, 2011

Smokehouse Big Chief Front - Load Smoker

!±8± Smokehouse Big Chief Front - Load Smoker

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Smokehouse Big Chief Front - Load Smoker. Smoke or dehydrate up to 50 lbs. of your favorite meat on this front-loading Smoker! Front panel comes off easily! Built with durable embossed aluminum construction, this little dandy heats up to 165 degrees for optimal operation. Simply load up the easy-slide chrome-plated grills and turn on the Smoker. Vented for proper dehydration. Includes free 1 3/4 lb. bag of Smokehouse Natural Wood Chips to get you started. Comes with instructions and recipe booklet. No assembly required. Has 120-volt, 450-watt heating element that's powered by your standard 110v house current. Smoker Dimensions: 12 1/4 x 18 1/2 x 27 1/8, weighs 22 lbs. Pick up this easy-loading Smoker today! Smokehouse Big Chief Front-Load Smoker

Purchase Surefire E1

Monday, December 19, 2011

Walgreens, CVS, and Rite Aid - What RE Investors Should Know in 2011

!±8± Walgreens, CVS, and Rite Aid - What RE Investors Should Know in 2011

Walgreens, CVS or Rite-Aid: Which Tenant Is Best in 2011?

There are 3 major drugstore chains in the US: Walgreens, CVS, and Rite Aid. Below are some key statistics about the 3 major drugstore chains as of July 2010:

Walgreens ranks #1 with market cap of .33 Billion, .25 Billion in revenue, and S&P rating of A+. According to Walgreens, 75% US population lives within 3 miles from its stores. On Oct 1, 2009, Walgreens opened its 7000-th store in Brooklyn, New York. In April 2010, it acquired 258 Duane Reade drug stores in New York Metropolitan area. CVS ranks #2 with market cap of .09 Billion, .1 Billion in revenue (CVS revenue alone is less than Walgreens if revenue from its Caremark group is taken out), and S&P rating of BBB+. CVS opened its 7000-th store in Little Canada, Minnesota on October 5, 2009 and currently operates 7025 drug stores.. Rite Aid ranks #3 with market cap of 9 Million, .53 Billion in revenue, 4780 drug stores and S&P rating of B-.

Investors purchase properties occupied by these drugstore chains for the following reasons:

The drugstore business is very recession-insensitive. People need medicine when they are sick, regardless of the state of the economy. Both rich and poor people in the US have access to medicine. Some even argue that low-income people use more medicine due to free or low-cost drugs offered by government-assisted programs. So the tenants should do well during tough time and have money to pay rent to landlords. The drugstore business has a good prospect in the US: People are living longer and need more medicine to sustain longevity, e.g. Actonel for osteoporosis, Aricept for Alzheimer's symptoms. Older people tend to use more medicine than younger ones as they often have more medical problems. As the 78 million baby boomers are getting closer to retiring age starting from 2008, the drugstore chains anticipate the demand for medicine to increase in next 20 years. The drug market continues to expand as the US population will continue to grow. More and more Americans suffer from various diseases. The number of Americans suffers from seasonal allergies doubled in the last 15 years to 37 million people per Fortune magazine. They spent .4 Billion in 2009 for allergy drugs. As their waist lines balloon (75% of Americans are forecasted to be either overweight or obese by 2020), more Americans are diagnosed with diabetes, high cholesterol at younger and younger ages. In addition, doctors also recommend treating various diseases sooner than later due to better understanding about the diseases. For example, doctors now prescribe antiretroviral drugs for patients soon after infected with HIV virus instead of waiting for the infection to become AIDS. More doctors combine insulin with oral medicines to treat type-2 Diabetes instead of just oral medicines alone. All these factors increase the size of the drug market. Advance in genetic engineering has introduced various new genetic DNA testing kits which allow the genetic diagnosis of vulnerabilities to inherited diseases and disorders. Genetic testing is currently the highest growth segment in the diagnostics industry. Some of these genetic tests will probably transform into direct-to-consumer testing kits available in drug stores in the near future. Upon FDA approval, these new products will potentially bring in additional revenue for drug stores. The passage of Health Care Reform Bill on March 23, 2010 provides insurance coverage to an estimated 33 million more American. This is a major present to the drugstore industry. There are new drugs to treat previously untreatable illnesses, and new diseases, e.g. Viagra for men's unhappiness, Zoloft for depression, Avastin for colon cancer, Herceptin for breast cancer, Nicotine patches for smokers to kick the habit, Tamiflu for a potential bird flu pandemic, vaccine for swine (H1N1) flu pandemic, Tekturna/Rasilez for hypertension and various new drugs for AIDS and Attention Deficit Disorder (ADD). The new medicines are very expensive, e.g. a year's supply of Avastin costs about ,000. Eli Lilly has sold about .8 billion of Zyprexa in 2007 for schizophrenia and yet most people have never heard of this medicine. There are existing drugs now approved to treat new illnesses and thus increase their sales revenue. For example, Lyrica was originally intended to treat pain caused by nerve damage in people with diabetes. It is now approved by FDA to treat Fibromyalgia which affects 5.8 million Americans per WebMD. Big advances in genetics, biology and stem cells research are expected to produce a new class of drugs to treat diabetes, Parkinson's and various rare genetic disorders. For example the new drug Ilaris from Novartis targets genetic causes of an inherited disorder that there are only 7000 known cases worldwide. However, Novartis hopes to gradually broaden its drugs to a blockbuster drug to more common disorders caused by similar genetics. Technology and modern life introduce and require new products, e.g. pregnancy test kits, Lamisil for stronger clearer toe nails, Latisse for longer & thicker eyelashes, Premarin for menopausal symptoms, diabetic monitors, electronic toothbrushes, contact lenses, lenses cleaners, diet pills, vitamins, birth-control pills, IUDs, nutrition supplements and Cholesterol-lowering pills (Americans spent nearly B in 2006 on Cholesterol medications alone per IMS Health, a Connecticut-based consulting company that monitors pharmaceutical sales.) There are also more surgeries: C-sections, Kidney transplants, open-heart triple by-pass, and breast augmentations. More surgeries mean more medicines are needed such as Vicodin for pain management and Warfarin to prevent blood clots in surgeries. Before the customers can get to the medicine aisles or pharmacy counters, they have to pass by chocolates, sodas, digital cameras, watches, toys, dolls, beers and wines, cosmetics, video games, flowers, fragrances, and greeting cards. Drug stores hope you use the one-hour photos services and exchange your liquid propane tanks there. The stores also carry seasonal items, e.g. Halloween costumes, and "As Seen on TV" merchandise, e.g. Shamwow. As a result, customers buy more than their prescriptions and medicine in these drugstores. Rite Aid sells more 28,000 non-pharmacy items in its stores while Walgreens has 22,000 different items on store shelves. CVS reported that non-pharmacy sales represented 30% of the company's total sales in January of 2007. The figure for Walgreens is 34% and 37% for Rite Aid. Many pharmacy locations are in effect convenience stores especially ones that are in residential or rural areas. And so Walgreens hopes that customers also pick up WD-44, and screw drivers at its stores instead of at Home Depot; Thai Jasmine rice, and fish sauce to avoid a trip to Safeway or Kroger Supermarkets. During the recession, sales of these non-drug items are down as customers buy what they need and not what they want. Walgreens tries to reduce the number of items by 4000. It also introduces its own private label which has higher profit margins. There are more and more generic medications on the market as a number of enormously popular brand-name blockbusters will lose their 20-year long patents, e.g. Lipitor (best selling drug in the world to lower cholesterol) in 2010, Viagra (you know what it's for) in 2012. Drugstores prefer to sell generic drugs to customers due to higher profit margins than the brand-name medications. Some people are addicted to pain killers, e.g. Hydrocodone and consume a large amount of medicine, e.g. 30-day dosage in a day to get high. According to testimony from the National Institute on Drug Abuse, US retail pharmacies dispensed nearly 180 million prescriptions in 2007 for opiates, e.g. Hydrocodone. A high percentage of these prescriptions are probably not used for any legitimate medical purposes. This author estimates that at least 10% of the dispensed prescription drugs are not used at all and sit idle in the medicine cabinets. They are eventually expired and thrown away. These companies sign very long-term, NNN leases, guaranteed by their corporate assets. This makes the investment in the underlying property fairly low risk, especially for Walgreens with an A+ S&P rating. In fact, these properties are sometimes referred to as investment-grade properties. Once the drugstore chains sign the lease, they pay the rent promptly and timely. This author is not aware of any properties leased by one of these drugstore chains in which the tenants failed to pay rents. Even when the stores are closed due to weak sales (Walgreens closed 119 stores in 2007), these companies may sublease the properties to other companies and continue to pay rents on the master leases. A typical Walgreens lease consists of 20-25 year primary term plus 8-10 five-year options. During primary term and options, there will be no rent increases in most of the leases. This is the main disadvantage of investing in Walgreens drugstores. A typical CVS lease consists of 20-25 year primary term plus 4-5 five-year options. The rent is normally flat during the primary term and then there is a 2.5%-10% rent increase in the in each 5-year option. A typical Rite Aid lease consists of 20-25 year primary term plus 4-8 five-year options. The lease often has a rent increase every 5-10 years.

Investment Risks: Although the pharmacy business in general is recession-insensitive, there are risks involved in your investment:

The main downside about investing in pharmacies is there is little or no rent bump for a long time, e.g. 20-50 years, especially for Walgreens. So the rent is effectively reduced after inflation is factored in. This is one of the main reasons these properties do not appeal to younger investors. The 3 drugstore chains now have a new formidable competitor, Wal-mart. Wal-mart sells prescription drugs in more than 4000 Wal-mart, Sam's Club and Neighborhood Market stores in 49 states. The retail giant is known for launching in 2006 a highly-publicized generic prescription drug program which now sells 350 generic medications for a 30-day supply. The actual number of medications is less as the medications with different strengths are counted as different medications. For example, Metformin 500 mg, 850 mg, and 1000 mg are counted as 3 medications. Wal-mart probably makes very little profits on these medications if any. However, the marketing campaign--created by Bill Simon, the President and CEO of Wal-mart US, generates a lot of publicity for Wal-mart. Wal-mart hopes to draw customers to its stores with other prescriptions where it has higher profit margins. In an unscientific survey with just one brand-name prescription of Lyrica, this author finds the lowest price at Costco, the highest price at Walgreens and Wal-mart at the middle. Other drug chains try to counter Wal-mart in different ways. Target now offers the same 350 generic medications for for a 30-day supply. Walgreens has a Prescription drugs club with membership fee which offers 1400 generic medications for as little as /week. CVS says it will match any offers from its competitors. Chief Business Correspondent Rick Newman from US World & News Report predicted that Rite Aid might not survive in 2009. While Rite Aid is still around in 2010, dire predictions continue. The study by Audit Integrity gave Rite Aid about a 10.5 percent chance of filing for bankruptcy in 2010. Drugs are also sold in thousands of supermarkets, Target stores, and Costco warehouses. However, there are no drive-thru windows at these stores or Walmart to conveniently drop off the prescriptions and pick up medicines. Customers will not be able to pick up their prescriptions during lunch hour or after 7PM at Target stores or supermarkets. They need to have membership to buy medicines at Costco. Others may not fill their prescriptions at Walmart because they don't want to mingle with typical Walmart customers who are in lower income brackets. And some babyboomers don't want their prescriptions filled at Target or Walmart because there are no comfortable chairs for them to sit down to wait for their medicines. Many leases in areas with hurricanes and tornados are NNN leases with the exception of roof and structure. So if the roof is damaged, you will have to pay for the expenses. The tenant may move to a new location down the road or across the street when the lease expires. This risk is high when the property is located in small town where there is low barrier for entry, i.e. lots of vacant & developable land. The tenant may ask for rent concession to improve its bottom line. The possibility is higher if the tenant is Rite Aid and if the store has low sales revenue and/or higher than market rent. More Americans are walking away from their prescriptions, especially the most expensive brand-name medicines. This may have negative impact on the sales revenue and profits of drug stores and consequently may cause drug store closures. According to Wolters Kluwer Pharma Solution, a health-care data company, nearly 1 in 10 new prescriptions for brand-name drugs were abandoned by people with commercial health plans in 2010. This is up 88% compared to 4 years ago just before the recession began. This trend is driven in part by higher and higher co-pays for brand name drugs as employers are shifting more insurance costs to their employees.

Among 3 drugstore chains, Walgreens and CVS pharmacies in general have the best locations-at major intersections while Rite Aid has less than premium locations. Walgreens tends to hire only the top graduates from pharmacy schools while Rite Aid settles with bottom graduates to save costs. When possible all drugstore chains try to fill the prescriptions with generic medications which have higher profit margins

Walgreens: the company was founded in 1901 by Charles Walgreen, Sr. in Chicago. While the company has existed for more than 100 years, most stores are only 5-10 years old. This is the best managed company among the three drugstore chains and also among the most admired public companies in the US. The company has been run by executives with proven track records and hires the top graduates from universities. Due to its superior financial strength--S&P A+ rating-- and premium irreplaceable locations, properties with leases from Walgreens get the highest price per square foot and/or the lowest cap rate among the 3 drugstore chains. In addition, Walgreens gets flat rent or very low rent increase for 20 to 60 years. The cap rate is often in the low 6% to 7.5% range in 2009. Investors who buy Walgreens tend to be more mature, i.e. closer to retirement age. They are looking for a safe investment where it's more important to get the rent check than to get appreciation. They often compare the returns on their Walgreens investment with the lower returns from US treasury bonds or Certificate of Deposits from banks. Walgreens opened many new stores in 2008 and 2009 and thus you see many new Walgreens stores for sale. It will slow down this expansion in 2010 and focus on renovation of existing stores instead

CVS: CVS Corporation was founded in 1963 in Lowell, MA by Stanley Goldstein, Sidney Goldstein, and Ralph Hoagland. The name CVS stands for "Consumer Value Stores". As of 2009, CVS has about 6300 stores in the US, mostly through acquisitions. In 2004, CVS bought 1,200 Eckerd Drugstores mostly in Texas and Florida. In 2006, CVS bought 700 Savon and Osco drugstores mostly in Southern California. And in 2008 CVS acquired 521 Longs Drugs stores in California, Hawaii, Nevada and Arizona for .9B dollars. The acquisition of Long Drugs appears to be a good one as it CVS does not have any stores in Northern CA and Arizona. Besides, the price also included real estate. It is also bought Caremark, the largest pharmaceutical services company and changed the corporation name to CVS Caremark. When CVS bought 1,200 Eckerd stores, it formed a single-entity LLC (Limited Liability Company) to own each Eckerd store. Each LLC signs the lease with the property owner. In the event of a default, the owner can only legally go after the assets of the LLC and not from any other CVS-owned assets. Although the owner loses the guaranty security from CVS corporate assets, this author is not aware of any incident where CVS closes a store and does not pay rent.

Rite-Aid: Rite Aid was founded by Alex Grass (he just passed away on Aug 27, 2009 at the age of 82) and opened its first store in 1962 as "Thrif D Discount Center" in Scranton, Pennsylvania. It officially incorporated as Rite Aid Corporation and went public in 1968. By the time Alex Grass stepped down as the company's chairman and chief executive officer in 1995, Rite Aid was the nation's largest drugstore chain in terms of total stores and No. 2 in terms of revenue. His son, Martin Grass, took over but was ousted in 1999 for overstatement of Rite Aid's earnings in the late 1990s. Rite Aid is now the weakest financially among the 3 drugstore chains. In 2007, Rite-Aid acquired about 1,850 Brooks and Eckerd drugstores, mostly along the East coast to catch up with Walgreens and CVS. In the process, it added a huge long term debt (currently owes over .69 Billion) and is the most leveraged drugstore chain based on its market value. The integration of Brooks and Eckerd did not seem to go well. Revenue from some of these stores went down as much as 20% after they change the sign to Rite Aid. In 2009, Rite-Aid had over 4900 stores and over Billion in revenues. The figures went down in 2010 to 4780 stores and .53 billion in revenue. On January 21, 2009 Moody's Investor Services downgraded Rite Aid from "Caa1" to "Caa2", eight notches below investment grade. Both ratings are "junk" which indicate very high credit risk. Rite Aid contacted a number of its landlords in 2009 trying to get rent concession to improve the bottom line. In June 2009, Rite Aid successfully completed refinancing .9 Billion of its debts. However, it continues to struggle in 2010 as same store sales decreased 2.5% in June, 1.7% in May, 1% in April,.1% in March, 3.2% in February, and 2.1% in January..

Things to consider when invested in a pharmacy

If you are interested in investing in a property leased by drugstore chains, here are a few things you should consider:

If you want a low risk investment, go with Walgreens. In stable or growing areas, the degree of safety is the same whether the property is in California where you get a 6% cap or Texas where you may get a 7.5% cap. So, there is no significant advantage to invest in properties in California as the property value is based primarily on the cap rate. In 2010, the offered cap rate for Walgreens seems to come down from 7.5%-8.4% in 2009 to 6.5%-7.5% for new stores. If you are willing to take more risk, then go with Rite-Aid. Some properties outside of California may offer up to 10% cap rate in 2010. However, among the 3 drug chains, Rite Aid has 10.5% chance of going under in 2010. Should it declare bankruptcy, Rite Aid has the option to pick and choose which locations to keep open and which locations to terminate the lease. To minimize the risk that the store is shuttered, choose a location with strong sales and low rent to revenue ratio. Financing should be an important consideration. While the cap rate is lower for Walgreens than Rite Aid, you will be able to get the best rates and terms for Walgreens. A 7.25% cap Walgreens with 5.25% interest rate on the loan will generate more cash flow than a 10% cap Rite Aid with 9% interest rate (if you could find a lender for Rite Aid). If you are not a conservative investor or risk taker, you may want to consider a CVS pharmacy. It has BBB+ S&P credit rating. Its cap rate is higher than Walgreens but lower than Rite Aid. Some leases may offer better rent bumps. On the other hand, some CVS leases, especially for properties in hurricane areas, e.g. Florida are not truly NNN leases where landlords are responsible for the roof and structure. So make sure you adjust the cap rate down accordingly. Some of the CVS locations have onsite Minuteclinic staffed by registered nurses. Since this clinic idea was introduced recently, it's not clear having a clinic inside CVS is a plus or minus to the bottom line of the store. All 3 drugstore chains have similar requirements. They all want highly visible, standalone, rectangular property around 10,000 - 14,500 SF on a 1.5 - 2 acre lot, preferably at a corner with about 75 - 80 parking spaces in a growing and high traffic location. They all require the property to have a drive-thru. Hence, you should avoid purchasing an inline property, i.e. not standalone and property with no drive-thru windows. There is a chance that these drugstores may not want to renew the lease unless the property is located in a densely-populated area with no vacant land nearby. In addition, if you acquire a property that does not meet the new requirements, for example a drive-thru, you may have a problem getting financing as lenders are aware of these requirements. If the pharmacy is opened 24 hours a day, it is in a better location. Drugstore chains do not open the store 24 hours day unless the location draws customers. Many properties may have a percentage lease, i.e. the landlord can get additional rent when the store's annual revenue exceeds a certain figure, e.g. M. However, the revenue used to compute percentage rent often excludes a page-long list of items, e.g. wine and sodas, tobacco products, items sold after 10 PM, drugs paid by governmental programs. The excluded sales revenue could account for as much as 70% of store's gross revenue. As a result, this author has seen only 2 stores in which the landlord is able to collect additional percentage rent. The store with a percentage rent is required to report its monthly sales to the landlord. As an investors, you want to invest in a store with strong gross sales, e.g. over 0 per square foot a year. In addition, you also want to check the rent to revenue ratio. If the figure is in the 2-4% range, the store is likely to be very profitable so the chance the store is shut down is low. It does not matter how good the tenants are, avoid investing in declining and/or low-income areas or small towns with less than 30,000 residents within 5 miles ring. In a small town, it may be the only drug store in town and captures most of the market share. However, if a competitor opens a new location in the area, revenue may be severely affected. These properties are easy to buy now and hard to sell later. In 2009 where the credit market is tight, you may have problems finding a lender to finance these properties. Many properties have an existing loan that the buyer must assume. If you have a 1031 exchange, think twice about buying this property. You should clearly understand loan assumption requirements of the lenders before moving forward. Should you fail to assume the existing loan (assuming an existing loan is a lot more difficult than getting a new loan), you may run out of time for a 1031 exchange and may be liable to pay capital gain. With few exceptions, drugstore chains do not own the stores they occupy for several reasons. Here are just a couple of them: They know the pharmacy business but don't know real estate. Stock investors also don't want Walgreens to become a real estate investment company. Owning the real estate will require them to carry lots of long term debts which is not a brilliant idea for a publicly-traded company. About 10% of the drugstore properties for sale and typically CVS pharmacies require very small amount of equity to acquire, e.g. 10% of the purchase price. However, you are required to assume an existing fully-amortized loan with zero cash flow. That is, all of the rent paid by the tenant must be used to pay down the loan. The cap rate may be in the 7% range, and the interest rate on the loan could be attractive in the 5.5% to 6% range. Hence, the investor pays off the loan in 10 to 20 years. However, the investor has no positive cash flow. This requires you to come up with outside cash to pay income tax on the rental profits (the difference between the rent and mortgage interest). The longer you own the property, the more outside cash you will need to pay income taxes as the mortgage interest will get less and less toward the end. So who would buy this kind of property? The investors who have substantial losses from other properties. By acquiring this zero cash flow property, they may offset the income from the drugstore tenant against the losses from other investment properties. For example, a property has 5,000 of rental profits a year, and the investor also has losses of 0,000 from other investment properties. As a result, the combined taxable profits are only ,000. The uninformed investors who fail to consider that they have to raise additional cash to pay income taxes.

Out of the Box Thinking If you put too much weigh on the S&P rating of the tenants, you may end up either taking a lot of risks or passing up good opportunities.

Good location should be the key in your decision on which drug store to invest in. It's often said a lousy business should do well at a great location while the best tenant will fail at a lousy location. A Walgreens store that is closed down later on (yes, Walgreens closed 119 stores in 2007) is still a bad investment even though Walgreens continues paying rent on time. So you don't want to blindly invest in a drug store simply because it hasa Walgreens sign on the building. No company is crazy enough to close a profitable location. It does not take a rocket scientist to understand that a financially-weak company like Rite Aid will make every effort to keep a profitable location open. On the other hand, a financially-strong Walgreens will need justifications to keep an unprofitable location open. So how do you determine if a drug store location is profitable or not if the tenant is not required to disclose its profit & loss statement? The answer is you cannot. However, you can make an educated guess based on store's annual gross revenue is often reported to the landlord as required by the percentage clause in the lease. With the gross revenue, you can determine the rent to income ratio. The lower the ratio, the more likely the store is profitable. For example, if the annual base rent is 0,000 while the store's gross revenue is M then the rent to income ratio is 5%. As a rule of thumb, it's hard to make a profit if this ratio is more than 8%. So if you see a Rite Aid with 3% rent to income ratio then you know it's likely a very profitable location. In the event Rite Aid declares bankruptcy, it will keep this location open and continue paying rent. If you see a Rite Aid drug store with 3% rent to income ratio offering 11% cap, chances are it's a low risk investment with good returns. The weakness of corporate guaranty from Rite Aid is probably not as critical and the risk of having Rite Aid as a tenant is not really that significant. Drug stores with new 25 years leases tend to sell at lower cap, e.g. 7-7.5% cap on new stores versus 8.0-8.5% cap on established locations with 8-10 years remaining on the lease. This is because investors are afraid that the tenants may not renew the leases. Unfortunately, lenders also have the same fear! As a result many lenders will not finance drug stores with 2-3 years left on the leases. The fact that drugstores with new leases have a premium on the price means they have potential of 10% depreciation (buying new at 7.3% cap and selling at 8.3% cap when the leases have 10 year left). Some investors will not consider investing in drug stores with 5-10 years left on the lease. They might simply ignore the fact that the established stores may be at irreplaceable locations with very strong sales. Tenants simply have no other choices other than renewing the lease.


Walgreens, CVS, and Rite Aid - What RE Investors Should Know in 2011

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Wednesday, December 14, 2011

Tennessee Controlled Substance Tax

!±8± Tennessee Controlled Substance Tax

Recently, Tennessee has joined a number of states that have passed legislation to allow for the assessment of an excise tax upon arrest for possession of controlled substances. Alabama, Colorado (repealed), Conneticut, Georgia, Idaho, Indiana, Iowa, Kansas, Kentucky, Minnesota, Montana (repealed), Nevada (repealed Check) North Carolina, Rhode Island, South Carolina, Texas, Utah COMPLETE THE LIST

Most of the "Controlled Substance Tax" (CST) statutes are structured as follows:

First the term, "dealer," is defined. A dealer is usually defined as a person who possesses more than a statutorily identified amount of particular controlled substances. States differ on the amount of controlled substances required for the possessor to be considered a dealer, but most states define a dealer as persons in possession of more than 42.5 grams of marijuana FILL IN REST OF DEFINITION

The statutes require dealers to purchase and affix stamps to the controlled substances in their possession. The stamp serves as evidence that the dealer has paid the required tax on the controlled substance.

When a person who meets the statutory criteria of a dealer is arrested in possession of controlled substances and no tax stamp is affixed, the statutes authorize the commissioner of the appropriate revenue department to assess a tax against the dealer. The amount of the tax usually correlates directly with the amount of the controlled substance.

States have varying miscellaneous requirements or constitutional safeguards. For example, several states' statutes impose criminal penalties on Department of Revenue employees who disclose taxpayer information. Several states' statutes specifically forbid the information obtained in acquiring a tax stamp to be used against the taxpayer in a subsequent criminal proceeding. Several states' statutes forbid the Revenue Commissioner from collecting information that could be used to identify the taxpayer.

As one might expect, the constitutionality of these statutes has been vehemently challenged with mixed results.

"As a general matter, the unlawfulness of an activity does not prevent its taxation." Department of Revenue of Montana v. Kurth Ranch, 511 U.S. 767, 114 S.Ct. 1937, 1941 (1994). Thus, it appears that a state can tax controlled substances even though the possessor has no legal property interest in the controlled substance. However, the author urges counsel to thoroughly research precedent within the state of the assessment because the Supreme Courts of some states have found their respective CST to be unconstitutional.

Among the successful constitutional challenges are violations of the Fifth Amendment pertaining to the double jeopardy clause and the privilege against self-incrimination.

Double Jeopardy

The Fifth Amendment provides that "[n]o person shall ... be subject for the same offence to be twice put in jeopardy of life or limb..." U.S. CONST. amend. V, § 2. "Although its text mentions only harms to 'life or limb,' it is well settled that the Amendment covers imprisonment and monetary penalties." Kurth Ranch, 114 S.Ct. 1937, 1941 (1994). "In Benton v. Maryland, 395 U.S. 784, 794 (1969), we held that this guarantee 'represents a fundamental ideal in our constitutional heritage, and that it should apply to the States through the Fourteenth Amendment.'" Id.

In Kurth Ranch, the Supreme Court held that Montana's CST was unconstitutional on the grounds that the CST violated the constitutional guarantee against double jeopardy.

In reaching its conclusion, the Court extensively cited its previous holding in United States v. Halper, 490 U.S 435, 109 S.Ct. (1989). In Halper the Court "rejected the Government's submission that the Double Jeopardy Clause only applied to punishment imposed in criminal proceedings, reasoning that its violation 'can be identified only by assessing the character of the actual sanctions imposed on the individual by the machinery of the state.'" Kurth Ranch, 114 S.Ct. at 1944-45 (quoting Halper, 490 U.S. at 447). Whether the State labels the sanctions as "civil" or "criminal" is "not of paramount importance." Id at 1945. "Halper thus decided that the legislature's description of a statute as civil does not foreclose the possibility that it has a punitive character." Id; See also Lipke v. Lederer, 259 U.S. 557 (1922); United States v. La Franca, 282 U.S. 568 (1931).

The Court "recognized in Halper that a so-called civil 'penalty' may be remedial in character if it merely reimburses the government for its actual costs arising from the defendant's criminal conduct." Kurth Ranch, 114 S.Ct. at 1945 (quoting Halper, 490 U.S. at 447). However, "[a] defendant convicted and punished for an offense may not have a nonremedial civil penalty imposed against him for the same offense in a separate proceeding." Kurth Ranch, 114 S.Ct. at 1945. Thus, the ultimate question is whether the CST is punitive or remedial in nature.

Notably, the Kurth Ranch opinion contains no clear definition of what is meant by a "remedial tax." In Kurth Ranch, the Court elaborated on the difference between a punitive civil penalty and a remedial civil penalty:

In Halper, we recognized that a civil penalty may be imposed as a remedy for actual costs to the State that are attributable to the defendant's conduct. Yet as The Chief Justice points out, tax statutes serve a purpose quite different from civil penalties, and Halper's method of determining whether the exaction was remedial or punitive 'simply does not work in the case of a tax statute.' Subjecting Montana's drug tax to Halper's test for civil penalties is therefore inappropriate. Even if it were proper to permit such a showing, Montana has not claimed that its assessment in this case even remotely approximates the cost of investigating, apprehending, and prosecuting the Kurths, or that it roughly relates to any actual damages that they caused the State. And in any event, the formula by which Montana computed the tax assessment would have been the same regardless of the amount of the State's damages and, indeed, regardless of whether it suffered any harm at all.

Kurth Ranch, 114 S.Ct. at 1948. In light of the fact that the Halper analysis is not instructive when a tax is at issue, the Court offers very little guidance as to the meaning of a "remedial" tax. Perhaps the most accurate definition is if the four features (discussed below) of the Montana CST are present, then the tax is punitive. If the features are absent (especially the last two features discussed below), the punitive nature of the tax is at least questionable.

The first two features of the Montana CST discussed by the Court are the "high rate of taxation" and the "obvious deterrent purpose" of the CST. Kurth Ranch, 114 S.Ct. at 1946. "[N]either a high rate of taxation nor an obvious deterrent purpose automatically mark [CST's] as a form of punishment." Id. "[M]any taxes that are presumed valid, such as taxes on cigarettes and alcohol, are also both high and motivated to some extent by an interest in deterrence." Id. While "these factors are not dispositive, they are at least consistent with a punitive character." Id.

The difference between a tax on cigarettes and a CST is that cigarettes are possessed legally:

Taxes imposed upon illegal activities are fundamentally different from taxes with a pure revenue-raising purpose that are imposed despite their adverse effect on the taxed activity. But they differ as well from mixed-motive taxes that governments impose both to deter a disfavored activity and to raise money. By imposing cigarette taxes, for example, a government wants to discourage smoking. But because the product's benefits - such as creating employment, satisfying consumer demand, and providing tax revenues are regarded as outweighing the harm, that government will allow the manufacture, sale, and use of cigarettes as long as the manufacturers, sellers, and smokers pay high taxes that reduce consumption and increase government revenue. These justifications vanish when the taxed activity is completely forbidden, for the legitimate revenue-raising purpose that might support such a tax could be equally well served by increasing the fine imposed upon conviction.

Kurth Ranch, 114 S.Ct. at 1947.

"Other unusual features, however, set the Montana statute apart from most taxes. First, this so-called tax is conditioned on the commission of a crime." Id. at 1947. "The tax is exacted only after the taxpayer has been arrested for the precise conduct that gives rise to the tax obligation in the first place." Id. "Persons who have been arrested for possessing marijuana constitute the entire class of taxpayers subject to the Montana tax." Id.

The Massachusetts Supreme Court has expounded on this feature of the prior Massachusetts CST. See Commissioner of Revenue v. Mullins, 702 N.E.2d 1 (Mass. 1998). Specifically, the Massachusetts Supreme Court clarified that the tax does not have to assess upon arrest, but the mere fact that the tax is contingent upon illegal conduct is indicative of the punitive nature of the CST.

While assessment of the [Massachusetts] CST does not specifically depend on arrest, criminal activity is required before the tax is imposed as the statute makes the tax exclusively applicable to illegal activity. In particular, only acquisitions or possession over threshold quantities 'in violation of Massachusetts law' result in 'dealer' status under the act, and thus subject the individual to the CST. Moreover, lawful possession of marihuana and controlled substance is outside the scope of taxability by operation of two statutory provisions: the definition of 'dealer' in § 1, and the specific exclusion in § 6, This nexus between the CST and criminal conduct is emphasized by the provision precluding construction of the CST to give dealers immunity from prosecution.

Id. at 6.

As the Massachusetts Supreme Court observes in Mullins, many other courts "have distinguished Kurth Ranch on the basis that the Montana statute specifically imposed the tax after the taxpayer was arrested for possession of the contraband, rather than 'immediately upon ... possession' as provided [in the Massachusetts statute]." Id. at 6 (citations omitted). However, many other courts have agreed with the Massachussets Supreme Court's view:

This attempt to distinguish Kurth Ranch is unpersuasive, and we agree with the broader interpretation given Kurth Ranch by those courts concluding that taxes similar to [the Massachussets statute] are punitive, by relying on the express limitation of the tax to unlawful activitiy. . . In our view, the similarity between the two tax schemes is more compelling than the difference. . .

Id. at 6-7. (citing Lynn v. West, 134 F.3d. 582 (4th Cir. 1998), cert. denied, 525 U.S. 813; Wilson v. Department of Revenue, 662 N.E.2d. 415 (Ill. 1996); Bryant v. State, 660 N.E.2d 290, 294 (Ind. 1995), cert. denied, 519 U.S. 926 (1996)).

Most states have stipulated that a dealer may voluntarily pay the tax before the arrest, i.e. purchase a tax stamp. However, this statutory provision should not save the statute from unconstitutionality on double jeopardy grounds. Enforcement of most of the states' taxes is

invariably limited to individuals who have been arrested for drug crimes. No dealers have voluntarily paid the tax, nor does the commissioner otherwise enforce the statute. 'The existence of the voluntary payment option is at best illusory and does not . . . make the post-arrest imposition of the Tax any less a penalty for double jeopardy purposes.'

Id. at 7 (quoting People v. Maurello, 932 P.2d 851, 853 (Colo.App. 1997). "As Chief Justice Rehnquist wrote in his dissent in Kurth Ranch: 'because the activity sought to be taxed is illegal, individuals cannot be expected to voluntarily identify themselves as subject to the tax.'" Id. at 7, n. 13 (quoting Kurth Ranch, 114 S.Ct. 1937, n. 2 (Rehnquist, C.J., dissenting)).

Despite this language, several states have held that their respective CST's are constitutional because the "dealer" could have paid the tax voluntarily. String Cite

In every state, the CST assessment, by definition, is contingent upon illegal conduct by the taxpayer. GIVE EXAMPLES Further, every state imposing a CST also illegalized the possession of controlled substances. "[I]t is significant that the same sovereign that criminalized the activity also imposed the tax. Contrarily, most of our cases confirming that the unlawfulness of an activity does not prevent its taxation involve taxes on acts prohibited by other sovereigns." Kurth Ranch, 114 S.Ct. at 1947, n. 22.

QUOTE LANGUAGE WHERE STATES HAVE IGNORED THIS

There is another feature of the Montana CST that the Court in Kurth Ranch found demonstrative of the punitive nature of the CST. The Court found that the Montana CST "purport[ed] to be a species of property tax - that is, a 'tax on the possession and storage of dangerous drugs.'" Kurth Ranch, 114 S.Ct. at 1948 (quoting Mont.Code Ann. § 15-25-111 (1987)). However:

it is levied on goods that the taxpayer neither owns nor possesses when the tax is imposed. If a statute that amounts to a confiscation of property is unconstitutional (omitted citations), a tax on previously confiscated goods is at least questionable. A tax on 'possession' of goods that no longer exist and that the taxpayer never lawfully possessed has an unmistakable punitive character. This tax, imposed on criminals and no others, departs so far from normal revenue laws as to become a form of punishment."

Id.

In other words, "the tax has no logical relationship to lawful possession. No 'dealer' has any ownership interest the law recognizes in goods the mere possession of which is criminal. . . Thus, the CST is levied on the possession of goods that the taxpayer never lawfully possessed in the first place." Mullins, 702 N.E.2d at 7 (also finding it significant that the goods were confiscated at the time the tax was assessed).

Many states characterize their respective CST as an excise and/or privilege tax. String Cite Include T.C.A. Presumably, this characterization is an attempt to avoid the fallacy of taxing property in which the owner has no legal interest. However, most states levy the tax on "possession" of controlled substances. String Cite. Further, most states structure CST's in a manner in which the tax rate is directly proportionate to the amount of the controlled substance possessed. String Cite Thus, there is a strong argument that the CST is a property tax .

Even if courts find that the CST is a privilege tax rather than a property tax, the argument that the possession of controlled substances is a "privilege" and therefore taxable as such, is at best strained. Again, "it is significant that the same sovereign that criminalized the activity also imposed the tax." Kurth Ranch, 114 S.Ct. at 1947, n. 22. Obviously, the distinction between a state granted privilege, such as a license to operate a motor vehicle, and an activity in which the state has completely forbidden, and in fact criminalized, is irreconcilable.

Once it is established that the possession of controlled substances is in fact a crime rather than a privilege, the inescapable argument follows that the criminal possession of the controlled substance cannot be taxed as a privilege. "If payment of the Drug Tax conferred ownership, then the tax would amount to nothing more than an expensive licensing or excise fee. The fact that it does not is another strong indication that the tax is a criminal penalty." Lynn, 134 F.3d at 592. "[T]he legislature cannot name something to be a taxable privilege unless it is first a privilege." Jack Cole Company v. McFarland, 337 S.W.2d 453, 455 (Tenn. 1960); See United States v. Doremas, 249 U.S. 86 (distinguishing license tax on lawful possession of firearms and taxes where the subject the of tax is criminal) .
In conclusion, the key to convincing courts that CST's violate constitutional prohibitions against double jeopardy is clearly establishing that the CST is punitive rather than remedial.

Most CST's share the four features of the Montana CST that the Supreme Court found to demonstrate the punitive nature of the Montana CST. Once it is established that the CST is punitive rather than remedial in nature, an analysis pursuant to Blockburger v. United States should conclusively establish that the constitutional guarantee against double jeopardy has been violated. See Blockburger v. United States, 284 U.S. 299 (1932).


Tennessee Controlled Substance Tax

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Sunday, December 11, 2011

The 700 Club - June 14, 2011 - CBN.com

Chef Baron Seaver shares the health benefits of fish and the story of Erik Bledsoe, who was so consumed with pornography and sex addiction that his doctor prescribed church... The Christian Broadcasting Network CBN www.cbn.com

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Wednesday, December 7, 2011

Smokehouse Products Little Chief Front Load Smoker

!±8±Smokehouse Products Little Chief Front Load Smoker

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Sunday, November 27, 2011

Part 1 - Babbitt by Sinclair Lewis (Chs 01-05)

Part 1. Classic Literature VideoBook with synchronized text, interactive transcript, and closed captions in multiple languages. Audio courtesy of Librivox. Read by Mike Vendetti. Playlist for Babbitt by Sinclair Lewis: www.youtube.com

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Friday, November 25, 2011

Ernie Kovacs: Television's Pioneer Of Visual Innovation And Comic Surrealism

!±8± Ernie Kovacs: Television's Pioneer Of Visual Innovation And Comic Surrealism

Ernie Kovacs was television's most original visual innovator and surreal comic genius, who made us see the world in a different way. He was a true artistic pioneer, who created his unique magic when the medium was just in its infancy.

The pictures that Kovacs conjured along the way, have had an enormous influence on a variety of television shows, as well as individual performers and writers who followed. These included: "Rowan and Martin's Laugh-In," "Monty Python's Flying Circus," and "Saturday Night Live," to name just a few. In addition, performers and writers, such as Steve Allen, Johnny Carson, David Letterman, Chevy Chase, and Mel Brooks, all owe a great deal to this inspiring and creative free spirit.

In 1986, the Museum of Television and Radio (now the Paley Center for Media) presented an exhibit of Kovacs's work, called "The Vision of Ernie Kovacs." In the Museum's booklet for the show, the Pulitzer Prize winning television critic, William Henry III wrote:

"Kovacs was more than another wide-eyed, self-ingratiating clown. He was television's first significant video artist. He was its first surrealist...its most daring and imaginative writer. He was television's first and possibly only auteur, and he was a genius... Kovacs's genius lay in the realm of art. There, a genius is someone who causes an audience to look at the world in a new way."

MEETING ERNIE KOVACS

In 1953, I first encountered Ernie Kovacs when I was 12 years old. Ernie's early morning television show, "Kovacs Unlimited," was being aired on network television in New York City on WCBS (channel 2). It was on this show that I first saw many of the visual sight gags, surreal illusions and characters that became an essential part of his astonishing and original vision. But as a 12-year-old kid, I just thought the show was very exciting, lots of fun and really cool!

As an avid fan of the show, I, immediately, joined Ernie's Early Eyeball Fraternity and Marching Society (EEFMS) and, officially, became an EEFMS member. For years, I proudly carried my EEFMS membership card around in my wallet, and when called upon, would sing the EEFMS song, while saluting (left index finger extended, and held over left closed eye):

"Hail to thee, oh EEFMS members, thee so brave and strong,
Through hot Julys and cold Decembers, sing our EEFMS song.
EEFMS, oh EEFMS, EEFMS, oh EEFMS,
We say this now with no misgiving,
If you're not EEFMS, you're not living!"

Then on one spring day in 1953, my good friend Arnie Eastman and I decided to "crash" Ernie Kovacs's studio at WCBS. Armed with our EEFMS membership cards, and the password: "It's been real!," we worked our way past the downstairs entrance guard and arrived, by elevator, at his studio floor. After we knocked on Kovacs's studio door, we were greeted by a member of his staff, who told us to go away. But my friend, Arnie, who was very persistent continued to beg this staff member to let us in. Suddenly, we heard a voice from within the studio: "what's the problem, Andy?" Then Ernie Kovacs came to the door, and after we explained that we were huge fans, and EEFMS members, he invited us into the studio, and seated us in two director's chairs, right in front of the set! (wow!)

The set was comprised of a long table pitched on an angle, with the television camera bolted to the floor at the same angle. So when we viewed the television monitor, the table appeared to be in its normal horizontal position, not on an angle.

Then, one of Kovacs's characters came out on the set carrying his lunchbox, and sat down at the tilted table. At the other end of the table sat another man reading his newspaper. Then each time the man with the lunchbox took an item out of his lunchbox and attempted to place it on the table, it would either slide or roll down the table into the lap of the man reading his newspaper. The finale of this sight gag came when the man with the lunchbox took out his thermos bottle, and attempted to pour some milk into his glass (which had been previously secured to the tabletop before the sketch began). The stream of milk moved at a bizarre angle, nearly parallel to the tabletop, completely missing the glass!

It was this classic sight gag stunt, and numerous other surreal effects, that shocked and delighted television audiences, and, ultimately, became a part of his renowned visual effects vocabulary.

After we stayed through the entire rehearsal of the show, Ernie Kovacs invited Arnie and me to join him for lunch! During lunch he regaled us with delightful anecdotes, as Arnie and I sat there hanging on his every word. Then after lunch, he asked us if we would like to see his office! - Arnie and I could hardly believe our good fortune, here we were, two unknown 12-year-old kids who Mr. Kovacs had never met before, and yet we were spending the day with Ernie Kovacs! (WOW!)

So after lunch, he took Arnie and me over to his office on West 57th Street, and he spent the afternoon with us, telling us fascinating stories, and showing us around his suite of offices. - Our favorite memory of the day was seeing the wild and wonderful collection of tribal artifacts, which Ernie had hanging and standing all around his private office - and the coolest thing of all was the border-cornice of shrunken heads surrounding the entire room!

THE EARLY YEARS and FINDING HIS PLACE

Ernest Edward Kovacs was born on January 23rd, 1919 in Trenton, New Jersey. He died in a car accident, just before his 43rd birthday, on January 13th, 1962.

Ernie Kovacs' father, Andrew, emigrated to the United States from Hungary at the age of 13. After working at several jobs, unsuccessfully, during Prohibition Andrew became a very successful bootlegger, which enabled him to move his wife, Mary and their sons, Tom and Ernie, into a 20 room mansion, in a fashionable section of Trenton. But with the exception of this period during Prohibition, the family continued to live in humble surroundings.

Ernie's interest in theater began in high school. At Trenton Central High School, Ernie came under the influence of his great mentor, drama teacher, Harold Van Kirk. Ernie received a scholarship to the American Academy of Dramatic Arts in 1937, with the assistance of Mr. Van Kirk. While working in Vermont in summer stock in 1939, Ernie became seriously ill with pneumonia and pleurisy, and spent the next year and a half in very serious condition in several hospitals.

It was during this time that his comedic talent began to show, as he enthralled the nurses, doctors and patients with his antics. (The doctors did not think that he would live). In addition, while in the hospital, Ernie developed a lifelong love and appreciation of classical music, and he kept his radio constantly tuned to WQXR, the classical music station, in New York City. In years to come, Kovacs would frequently use classical music in many of his sketches.

In 1941, Ernie found his first paid job in entertainment work as a disc jockey, at Trenton's WTTM radio. He spent the next nine years with WTTM, becoming the station's Director of Special Events. During this period, Kovacs experimented with a variety of "live" zany events, such as seeing what it would be like to be run over by a train (leaving the tracks at the last second), to broadcasting from the cockpit of an airplane (for which he took flying lessons).

During this period, Ernie was also involved in a local theater group, the Trenton Players Guild, in early 1941, doing some directing for the group. In June, 1945, the Trentonian, a local weekly newspaper, offered Kovacs a column, which he called "Kovacs Unlimited," in which he found his voice as the local wag.

Ernie married his first wife, Betty Wilcox, on August 13, 1945. They had two daughters together, Elisabeth (Bette) and Kip Raleigh (Kippie). The marriage was an unhappy one, and they finally divorced on February 11, 1954. When the marriage ended, Ernie was awarded full custody of their two daughters, based on the court's decision that his former wife was mentally unstable. In that same year Ernie married Edith (Edie) Adams on September 12, 1954.

In 1950, Kovacs had his first opportunity to break into television. He showed up at his audition at NBC's Philadelphia affiliate, WPTZ (now KYW-TV) wearing a barrel and shorts, and got the job! Ernie's first assignment was a show called "Pick Your Ideal," a fashion and promotional show for the Ideal Manufacturing Company. Before long, he was also the host of "Deadline For Dinner," which was a show where local chefs shared cooking tips and tricks. One night the guest chef did not show up, so Ernie was called into action to ad-lib at the 11th hour, and improvised his own recipe for Eggs Scavok (Kovacs spelled backwards).

Soon after, Ernie hosted and, ultimately, created a unique format for the groundbreaking show, "Three To Get Ready"(TTGR). This was the first regularly scheduled early morning show (7 to 9 AM) in a major TV market. Prior to this, it had been assumed that no one would watch TV at such an early hour. Although the show was billed as early morning news and weather, Ernie provided this, along with his own zany and original approach. When rain was in the weather forecast, Kovacs would stand on a high platform, and sprinkle water over the person reporting the weather forecast. On one occasion goats were auditioned for a local theater performance.

It was on the TTGR show that Ernie began to develop his ad-libbed, experimental style that would become his reputation. Among his many innovations early on, Kovacs allowed the so-called fourth wall to be breached, going beyond the boundaries of the show set to expose the behind-the-scenes action, at once shocking and fascinating the viewing audience, who had never seen anything like this before, as he went from interacting with the TV camera crew, to taking a tour of the control room, and chatting with the technicians. And then sometimes he went outside of the studio. He once, spontaneously, decided to wear a gorilla costume, and ran through a downtown Philadelphia restaurant.

When Ernie could no longer put up with his scant prop budget of a week for the show, he solved the problem by asking his TV viewers to send anything that they no longer wanted, to channel 3, WPTZ. On that same day, the entire studio lobby was full of all the discarded stuff that his viewers had sent!

It was on this show that Kovacs found his milieu. Ironically, the failure of the highly rated show, "Kovacs on the Corner," contributed to finding his place. He was gradually discovering that his true milieu was the television studio space, unencumbered by cutesy street sets, with crooked barber shop polls (the setting for "Kovacs on the Corner," where there were too many creative collaborators). In the undecorated studio, he could give free rein to the flow of ideas, contrasting surreal mixtures of the commonplace and the unusual, which only he could visualize - he had to be in control.

As much as Ernie wanted to be in control of "the vision," he relied heavily on his savvy crew, comprised of his special effects technicians, set designers, musical staff, cameramen, soundmen and others, many of whom had worked with him since the beginning, and knew his moods, idiosyncrasies and rhythms so well, that they were able to anticipate and improvise at a moment's notice - sometimes inspiring, or even saving a sketch that was in trouble.

The process of creating new shows with a unique approach and original material, working with minimal scripts and very little rehearsal time, in a "live" television format of that period (there was no videotape, so you were performing without a net), was always a daunting prospect. By their very nature, the shows were experimental. Ernie set no limits for himself, constantly improvising and taking chances. Sometimes the results were brilliant and very funny, and at other times they were just inane and boring. From Ernie's perspective everything was fun - success or failure - he was just a big kid, and the crew were his playmates.

But in the conventional world of television producers, and unsophisticated audiences, where high ratings were the badge of success, Ernie Kovacs was swimming against the tide, which was inevitable for such an innovative visionary.

Throughout his television career Ernie Kovacs always had a large cult following of avid viewers, and received constant praise from the critics. But, ironically, and perhaps, because of his inventive and experimental style, he was never able to consistently sustain the interest of the larger television audience, who had been conditioned by conventional sitcoms and vaudeville style variety shows.

CHARACTERS and SIGHT GAGS

As the incorrigible prankster, Kovacs also encouraged his crew to follow suit and improvise, and take chances. So on at least one occasion, the crew turned the tables on Ernie. On that day, Kovacs appeared as the inept magician, Matzoh Hepplewhite. The sketch called for Hepplewhite to hit a gong frequently. This was the signal for a sexy female assistant to appear with a tray with a bottle of liquor and a shot glass. Ernie (Hepplewhite) was supposed to take a snort, which was supposed to be tea. But the stagehands substituted real liquor instead of the tea. When Ernie took the snort of liquor, the expression on his face was priceless: realizing, of course, that every time he rang the gong he would have to drink another shot of real liquor! Since it was"live"television he had to continue on with the sketch. So at the end of the show, Ernie staggered off the set completely drunk.

As the madcap performer that he was, Ernie played a variety of roles, many of whom became recurring characters. These included the silent Chaplinesque, Eugene, who was the character who poured milk from his thermos bottle that never reached the glass on that tilted table. Ernie was also one of the three derby-hatted apes, known as the Nairobi Trio, who performed their mechanical antics to the tune of Robert Maxwell's "Solfeggio." They were regulars on the early morning show, "Kovacs Unlimited."

One of my favorite characters was the effete poet laureate, Percy Dovetonsils, also portrayed by Kovacs, who spoke with a lisp, and often recited poetry, in between sips of his dry martini (once a stagehand slipped a goldfish into his glass, just as he was going on "live," on the air).

In addition to the many characters that Ernie portrayed, there were many elaborate sight gags that he would perform that, often, only lasted a few seconds. One of my favorites is an underwater stunt, with Ernie playing himself, as the inveterate cigar smoker. In the sketch, Ernie is actually underwater, sitting in his easy chair with a cigar in his mouth, reading his newspaper. He then removes the cigar from his mouth and exhales a puff of white smoke! (The trick is that the "smoke" was actually a small amount of milk, which he filled his mouth with before going underwater).

KOVACS'S VISION and TECHNOLOGY

In the pioneer days when television was in its infancy - early 1940s into the 1950s - radio was still the reigning medium. As a result, the thinking about television as a medium, was very conventional. Directors of television productions would only use special effects, such as cuts or fades or dissolves, similar to the techniques commonly used in the movies at that time. The more sophisticated visual techniques that were available, such as super imposition (one image from one TV camera placed over a second image from another TV camera) was rarely used except in the most conventional way. Similarly, reverse polarity (throw a switch and turn positives into negatives), and reverse scanning (where images could be flipped upside down) were not used because early television generally stuck to realism. Most television productions at that time resembled filmed theater or vaudeville. Directors would just set up a stationary TV camera and let it run.

In the ongoing discussion of Ernie Kovacs's unique form of visual comedy, much has been made of the technical wizardry involved, and the fact that he was ahead of his time. It is true that Kovacs was enthralled with these new electronic toys that had never been used before. He and his crew freely experimented with the technology, and realized that these techniques offered great possibilities. But, what was most important was determining what they would be used for. So the technology played a part, but the process always began, first, with Ernie visualizing a particular scene in his mind. According to the writer, Mike Marmer, who eventually worked for Kovacs:

"Ernie really saw pictures more than anything else. I don't know where they came from, or why - they were just bizarre - but the point is, that that's what he saw. He saw the shock of something."

So for example: let's say that Ernie had an idea for a sketch. He first saw a picture of a man (character) who sees a sign that says: "fly man wanted." Then, Ernie saw a picture of the man walking upside down into the studio. Finally, the technology followed: by using the reverse scan function, the image of the man is flipped upside down, and "the vision" was complete.

FINALLY - RECOGNITION

Recognition of Ernie Kovacs's artistic achievements has been woefully slow in coming. It was not until nearly 25 years after his death, that he began to receive the recognition that he deserved.

As I mentioned in greater detail at the beginning of this article, in 1986, the Museum of Television and Radio (now the Paley Center for Media) mounted a four-months long series "The Vision of Ernie Kovacs," which showcased the diversity of his work. In 1987, Ernie Kovacs was inducted into the Academy of Television Arts and Sciences's Hall of Fame. In 1989, on the occasion of television's 50th anniversary, in a special issue of New York Magazine, Ernie Kovacs was named one of the medium's top 25 stars of all time.

In the closing remarks in her wonderful book, "Kovacsland: a Biography of Ernie Kovacs," Diana Rico wrote:

"The recognition is well-earned and long overdue. In his lifetime, despite a loyal contingency of fans and a supportive critical establishment, Ernie's insistence on swimming against the mainstream tide prevented him from achieving the high prime time ratings that are regarded as the badge of success in network TV. But the same qualities that kept him from reaching the high numbers were what made him a special talent -the endlessly curious intellect, the love of experimentation, the boundless imagination, the subversive and surreal wit. Ernie Kovacs loved nothing more than to create his bizarre visions for the world to enjoy. We are fortunate that for a dozen years at the beginning of the most important medium of our time, he was able to do just that."


Ernie Kovacs: Television's Pioneer Of Visual Innovation And Comic Surrealism

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Tuesday, November 22, 2011

Addiction Marketing

!±8± Addiction Marketing

"Addiction Marketing" is a phrase I coined a few years back while waiting in line for my drink at Starbucks. I was observing the mass of people who like lost explorers in the desert rushing for an oasis seemed to be desperate for their daily (if not more frequent) fix of caffeine. It was at that moment that I realized that one of Starbucks key business drivers, if not their most critical business driver, was that Starbucks sells products that cater to peoples addictive tendencies. What Starbucks has done better than many other addictive marketers is that they also make it cool and trendy to succumb to your addiction. In today's blog post I'll examine addiction as a key success factor in business.

When I was in school economics professors would lecture on using supply and demand drivers to create a business advantage...business professors would evangelize the strengths of the recurring value and stability of consumable products...marketing professors would espouse the benefits of relationship marketing, but nowhere do I recall being able to register for a class on addiction. However if you think about "Addiction Marketing" you'll quickly realize what the "media pushers" on Madison Avenue and the product development and marketing gurus in the corporate world have known for years...all people have their unique set of vulnerabilities that if creatively and effectively exploited will lead to strong sales and powerful brands.

If you read the business news over the weekend you'll have noticed that the Indian government is attempting to force Coca Cola and Pepsi to divulge the formulas to their popular beverage products. One of the charges being upheld in the Indian High Court is that Coke and Pepsi products are addictive and unhealthy...Hmmm...Examine the following representative list of successful businesses and/or industries and come to your own conclusions as to whether these businesses or industries prey on the addictions of consumers world-wide to generate their revenue:

Las Vegas - The tagline "What happens in Vegas stays in Vegas" caters to virtually every possible addiction under the sun...Sin City lives up to its reputation.

Tag Body Spray - Tag's recent commercial campaign has taken the phrase "Sex Sells" to a whole new level...In this campaign all an adolescent male needs to do is to spray himself with the Tag product and he finds himself instantly being attacked by hordes of attractive young women...If you have a teenage son, it would be a safe bet that Tag is his cologne of choice.

The Beer and Alcohol Industry - You will be hard pressed to find a beer or alcohol company that doesn't portray consumption of their beverage as the key ingredient to a lifestyle of fast cars, beautiful women, successful careers, etc.

The Tobacco Industry - The tobacco industry has been publicly hammered for selling products that leverage the addictive effects of Nicotine and even with all the known health hazards smokers face, in many instances the addictive nature of the product is greater than peoples ability to make a logical decision.

I don't think anyone will dispute the examples noted in the above list as obviously preying on consumer's addictive tendencies. However what about the more subtle side of the addiction business? Isn't Starbucks using the same addictive business tactics as those industries listed above? What about companies in the luxury products sector? Companies that sell high end products and services cater to the elitist attitudes of this segment allowing consumers to make statements about their socioeconomic status based on the products they purchase. Is this not also catering to addictive tendencies?

OK, now I'll hit a little closer to home...What about my company's value proposition? We sell success...Is it not possible to look at success as being an addiction? How about the social networking industry? Are social networkers and bloggers addicted to the interaction, attention, etc. that the new media platform affords? While I could go on, I think my point has been made...I'm certainly not implying that all consumers are addicts, nor am I implying that all companies are "pushers", but I am pointing out that addiction marketing sells and that many companies use this as a strategic advantage. In fact, I believe the evidence is clear that a business can create a strong strategic advantage in sustainability if they find no ethical flaw in what I've coined as "Addiction Marketing".

The bottom line is that I love to travel and watch movies and I don't think it makes me an escapist...I have a penchant for Starbucks (venti caramel frappacinos in particular) and I don't think I'm a caffeine addict, I appreciate the fine clothes and quality automobiles and I don't believe that makes me a social elitist. However I have also come to realize that my perceived addictive tendencies are clearly attempting to be preyed upon by creative and intelligent marketing and product development efforts. I'll leave you with the following questions to ponder:

What is the difference between pleasure and addiction?

Do you feel "Addiction Marketing" is ethical?

Does your company partake in addictive marketing strategies and tactics?

And, when was the last time you made a purchase based upon your addiction?


Addiction Marketing

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Thursday, November 10, 2011

Wine and Health Research - The Power of Procyanidins - The Real French Paradox

!±8± Wine and Health Research - The Power of Procyanidins - The Real French Paradox

Imagine that in future procyanidin pills are recommended just as aspirin is today. Such are the healthy properties of procyanidin, this is a possibility. Procyanidins have been identified as high performance, low toxicity and highly bio-available. Some red wines have been identified as containing extremely high concentrations of this powerful heart healthy compound.

A steady stream of animal and in vitro studies supplemented by epidemiological evidence and human studies reveal numerous health benefits. Chief among the benefits is antioxidant protection against heart disease and some cancers.

Consider these Imperatives

Procyanidins have been identified as high performance, low toxicity and highly bio-available. Procyanidins, available in some red wines, 70% cocoa solids dark chocolate and other foods, is a healthy compound in the highest doses and part of a natural diet - NOT an unnaturally high-dose supplement (as with other compounds) that is not proven to be safe over the long term and possibly not even absorbed fully as has been observed with some supplements. Research identifies that after two weeks of a daily glass of procyanidin rich red wine positive support for cardiovascular health was observed, including reduced blood pressure. This is good news for protection against heart disease and strokes. The health statistics are significant and important -- Almost half of us die of HEART DISEASE -- World Health Organization, and 50% of STROKES are caused by high blood pressure. "Nowhere in the world where populations are given drug treatments to manage cardiovascular health, have they achieved the low levels of heart disease related deaths, as occurs in Gers (France) where they drink these wines" Professor Giovanni de Gaetano, M.D., Ph.D, In south west France where they have make and consume wines high in procyanidins, census data shows there is twice the number of 90 year old males as the national average. In this region the wines are up to 10 times more procyanidin rich than the modern style, sweet, soft, quaffing red wines so commonly made today. In New Zealand, consumers who begin a strategy of a daily glass of the wines of south west France are experiencing blood pressure improvements consistent with the research. This occurs without change to lifestyle, diet, exercise or medication. Procyanidins provide the same benefits, naturally, as would possibly be achieved with the "polypill". The polypill is a mixture of already in use drugs that is intended to prevent heart attacks and strokes. Governments and drug companies internationally are trying to develop such a drug, to be taken daily, that is aimed to protect older populations from heart disease. In procyanidins it already exists in the natural form. Perhaps there is significance for our health that with today's prevalence of processed and refined foods, our consumption of procyanidins is much lower than the amount we likely evolved with!

This report is an illumination of the considerable international research that has been conducted into the health benefits of procyanidins.

What is Procyanidin

Procyanidins are a mixture of antioxidant molecules, variously called --

procyanidins proanthocyanidins, oligomeric procyanthocyanidins (OPC) proanthocyanidolic oligomers (PCO) leukocyanidins

Procyanidin, a polyphenol compound with strong bioactivity and pharmacologic activity, resides widely in grape seeds, hawthorn, pine bark and other foods and plants. A number of potential mechanisms of procyanidin have emerged. These include, serving as an important in vivo antioxidant, decreasing blood pressure, reducing risk of cancer, inhibiting bacteria, and so on. In recent years, the beneficial health and longevity effects of procyanidin on the human body has been extensively researched internationally.

Research has reported that procyanidin has multiple anticancer effects, notably for being toxic to cancer cells, on cancers such as cutaneous carcinoma, oral carcinoma, breast carcinoma, bronchogenic carcinoma, liver carcinoma, prostate carcinoma, pancreatic carcinoma, gastric carcinoma, and more, along with growth promoting effects on normal cells.

Commonly referred to as OPC in scientific circles, procyanidin is expert at treating vascular diseases because it actually increases the structural strength of weakened blood vessels, maintaining their permeability and elasticity. This occurs because OPCs help neutralize the underlying chemical cause (oxidation of living cells by free radicals) that promotes many diseases.

OPC is one of the most potent antioxidants known -- 50 times more powerful than vitamin E and 20 times more so than vitamin C, according to some tests.

Grape seeds and pine bark are two of the richest known sources of OPCs. Procyanidins have also been identified as abundant in walnuts husks, cranberries, certain apple varieties, pomegranates, horse chestnuts, hazelnut leaves, hawthorn, rhubarb and barley (also beer made from barley). However tests have shown that significant variation in procyanidin content can exist within these foods.

Toxicity

In 2002 a safety evaluation of OPC rich grape seed extract was undertaken to determine the toxicology of proanthocyanidins, especially in oral administration when used in various foods. The grape seed extract (GSE) was examined for acute and sub chronic oral toxicity and for mutagenic potential. The tests were undertaken using mice and rats. No evidence of acute oral toxicity and no evidence of mutagenicity was found. The results of the studies indicate a lack of toxicity and support the use of proanthocyanidin-rich extract from grape seeds for various foods.

Cardiovascular Disease

Roger Corder, Professor of Experimental Therapeutics at the William Harvey Research Institute in London, identified that procyanidin in some red wine is responsible for the reduction in the risk of coronary heart disease and the lowering of overall mortality in regular, moderate consumers of red wine.

On 30 November 2006 a research article was published in Nature magazine on Procyanidins and the significant health-giving benefits of some red wines. Nature is one of the world's preeminent science journals.

Epidemiological studies revealed that two populations in Europe have exceptional longevity. People in the Nuoro province of Sardinia and those in the department of Gers in south west France, especially men, have a significantly greater longevity than the national average. These populations do NOT consume the "Mediterranean Diet". Corder tested wines and identified that in this region the wines are up to 10 times more procyanidin rich than the modern, sweet, soft, quaffing style red wines so commonly made today. This is the very top of the healthy red wine "pyramid".

Corder and his team looked at these populations and their lifestyles and determined that there was something about the wines in these regions and so began a study of the components and compounds in the wines. They designed their study so they wouldn't know which compound worked best until the end of the trial. The researchers cultured endothelial cells and then added small amounts of red wine. The team isolated and measured the biological activity of each polyphenol in red wine. In hundreds of experiments, using wines from all over the world, procyanidin proved to be the best at regulating production of endothelin-1 to achieve the most favourable levels. Procyanidins suppressed overproduction by 50 percent.

Other compounds, such as resveratrol (a non-flavanoid polyphenol) and quercetin, were found to have an irrelevant effect.

The researchers discovered that red wines from those two regions are particularly high in procyanidins. This is because a large proportion of the grapes used to produce the local wines in these regions are the flavanoid-rich Tannat. Furthermore the traditional wine-making techniques in the south west of France, where the grape skins and seeds remain in contact with the juice for an extended period during fermentation and maceration, significantly increased the concentration of procyanidins in the red wines.

The groundbreaking research by Professor Roger Corder and colleagues established that:

1. Procyanidins lower blood pressure by suppressing endothelin-1,

a peptide that has an undesirable vasoconstriction effects. They also increase nitric oxide in the blood causing vasodilation and increased blood flow

2. Procyanidins decrease platelet aggregation,

thus preventing clot formation and blockage of arteries

3. Procyanidins prevent oxidation of LDL-cholesterol.

High blood cholesterol levels are a major risk factor for heart disease because LDL-cholesterol can accumulate in the artery wall where after oxidation it causes inflammation and the formation of plaque. When LDL-cholesterol is protected from oxidation it is less likely to cause atherosclerosis

4. Very few wines have exceptionally high concentrations of procyanidins.

Corder tested many wines and identified only a few regions of the world that consistently have the highest concentrations of procyanidins

Powerful Antioxidants

OPCs have a deservedly high reputation as antioxidants that quench free radicals and potentiate other antioxidants. In one in vitro study OPCs prolonged the life span of vitamin C by 400 percent. Another in vitro study showed that exposing blood vessel linings to pine bark OPCs boosted their vitamin E content by 15 percent. Grape seed has also shown recycling and potentiating effects. The test tube-based activity of vitamin E, in a system mimicking cell membranes, has shown enhancement by grape seed OPCs.

A mouse study, at the Creighton University School of Pharmacy in Omaha, Neb., found that a patented grape seed extract protected tissue from oxidation better than the antioxidant vitamins C and E or beta-carotene.

Grape seed OPCs were observed to be a stronger antioxidant than vitamins C and E, even when the two vitamins were combined, in an in vitro experiment testing the response of human mouth cells to the free radical damage caused by smokeless tobacco.

Preventing Atherosclerosis

The role of oxidation in the development of hardened arteries (atherogenesis) is increasingly understood. Oxidized LDL (low-density lipoproteins) cholesterol provokes numerous adverse responses including inflammation, smooth muscle cell proliferation and clotting mechanisms to the cells that line blood vessel walls. All this leads to atherosclerosis.

A grape seed extract with 50 percent OPCs and 50 percent phenolic acids prevented such oxidation of pig LDL in vitro. OPCs may also prevent atherosclerosis in other ways. For example, two in vitro studies found that a patented pine bark extract modulated the release of nitric oxide, which affected the dilation diameter of blood vessels.

Similarly this is one of Corder's primary finding -- that high blood cholesterol levels are a major risk factor for heart disease and stroke because LDL-cholesterol can accumulate in the artery wall where after oxidation it causes inflammation and the formation of plaque. When LDL-cholesterol is protected from oxidation it is less likely to cause atherosclerosis.

Researchers compared the effects of patented pine bark extract OPCs with aspirin on smoking-induced platelet aggregation in three groups of smokers. They found that platelet aggregation was inhibited by both 500 mg aspirin and 100-125 mg pine bark extract. Because of the increased bleeding time caused by aspirin, the authors conclude that pine bark offers an "advantageous risk-benefit ratio."

Increasingly, studies are raising questions of safety with long term use of aspirin by the "worried well" to prevent heart attach. Studies have found sustained use almost doubles the risk of admittance to hospital due to internal bleeding.

OPCs appear to inhibit several factors contributing to atherosclerosis, but do they actually prevent the condition? Yes, is the conclusion according to recent animal experiments. Researchers at a soy sauce manufacturing plant in Noda City, Japan, fed rabbits a diet that caused high blood cholesterol and severe atherosclerosis in the control animals. Their blood levels of peroxides (a measure of oxidation) increased by 10 times. Another group of rabbits ate the same diet but supplemented with grape seed OPC extract amounting to either 0.1 or 1 percent of their diet. The supplemented rabbits also developed high cholesterol levels; however, they had no detectable peroxides in their blood. Even more impressive, their blood vessels had no atherosclerosis whatsoever. These findings have been confirmed by other research on grape seed and pine bark OPCs. This emphasizes that the issue is the degree of oxidation of the cholesterol and not high cholesterol itself per se.

Although promising data on OPCs and atherosclerosis prevention primarily come from test tube and animal studies, epidemiological research may lend credence to the value of OPCs in human health. In fact, OPCs may help explain the "French Paradox," or why low coronary heart disease rates exist in French provinces known for high-fat foods and red wine consumption. These populations do NOT have a 'Mediterranean diet'.

The French Paradox was first proposed by Dr Serge Renaud in 1991. Dr Renaud's attendance at the Wine & Health Symposium (headlined by Professor Corder) in Pau, France, in 2007 was confirmation he supports Corder's research that identified procyanidins as the explanation of The French Paradox. Corder concludes from his research and epidemiological studies that OPCs are the cause of the exceptional longevity in some populations in south-west France and Sardinia. Corder proposes this is the REAL French Paradox.

Red wine could be considered an alcohol tincture of several potent flavonoids, including OPCs from grape seeds. At the University of Padova, Italy, they fed volunteers a high-fat meal with and without red wine. Post-meal plasma peroxide levels were much lower in those who drank wine.

OPCs also appear to prevent damage caused by atherosclerosis by preventing ischemic reperfusion injury. With atherosclerosis, a clot can restrict blood flow to the heart. If this clot is broken up, blood comes pouring back into the tissue. That process, paradoxically, results in an incredible amount of free radical damage. At the University of Connecticut School of Medicine in Farmington, they subjected animal hearts to blood-flow constriction and release. Compared with control animals, the animals supplemented with a patented grape seed extract had 38 percent less heart damage and 50 percent less creatine kinase release, a marker of tissue damage.

Breast Cancer

Studies have shown that the production of estrogens in breast cancer tissue plays a major role in tumor progression. In vitro studies have shown that procyanidin B dimers were able to reduce androgen-dependent tumor growth, indicating that these chemicals reduce the production of estrogens from the androgen substrates.

In a study researchers demonstrated that procyanidin B dimers in red wine could be used as chemopreventive agents against breast cancer by inhibiting the conversion of androgens to estrogens in breast tissues. The researchers estimated that a single four-ounce glass of red wine daily could provide enough procyanidin B dimer to inhibit aromatase activity in an average post-menopausal woman.

Prostate Cancer Protection

A study concluded that procyanidin can induce apoptosis (self-destruction of cancer cells) and necrosis (death of cells as a result of an outside agent) of prostate cancer PC-3 cells in a mitochondrion-dependent manner. The significant changes observed occurred to varying degrees according to dose and time dependant manners within a few hours of treatment beginning.

Prostate carcinoma (PCa) is one of the most prevalent cancers in men. The rate of PCa-related death increases every year. Until now, there has been no effective therapy that has an obvious effect on extending the life span of PCa sufferers. Other traditional therapies, such as radiotherapy, chemotherapy, and surgery, cannot prevent PCa from developing into metastatic clones and becoming androgen-refractory. Therefore, developing new therapeutic strategies targeting apoptosis induction would be of real value in controlling the proliferation as well as the invasiveness of advanced PCa.

The study aimed to determine whether procyanidin-induced apoptosis and necrosis of PC-3 cells is related to Mitochondrial membrane potential. The mitochondrion is a structure in the cytoplasm (outside the nucleus) of all cells except bacteria in which food molecules (sugars, fatty acids, and amino acids) are broken down in the presence of oxygen and converted into energy. So as the cell "powerhouse" it is vital to human health. It is also an important structure within the cells that regulates cell death. The study showed that Mitochondrial membrane potential was significantly reduced in PC-3 cells by treatment with procyanidin. Thus toxicity of procyanidin to these cancer cells was demonstrated.

Other Cancer Protection

Other in vitro studies also suggest OPCs provide cancer protection. OPCs in Vaccinium-family berries, including blueberry, lingonberry and cranberry, block tumor growth by preventing protein synthesis in tumor cells, thereby preventing them from multiplying. Also in the laboratory, barley bran OPCs transformed human myeloid leukemia cells into cells that were no longer cancerous. Another in vitro study found that a patented grape seed extract killed cancer cells; inhibited growth of human breast, lung, stomach and myelogenous leukemia cells by up to 73 percent; and enhanced normal cell growth.

Betel nut, a stimulant chewed by millions of Asians, also contains OPCs. In a small study into the inhibitory effect of betel nut extracts on endogenous nitrosation in humans, the researchers noted that OPCs may play a major role in natural cancer prevention.

Other Health Benefits

Protection again viruses may also occur with OPCs. In vitro studies with OPCs from hawthorn (Crataegus oxyacantha) killed the herpes (HSV-1) and HIV viruses.

Venous insufficiency is a common condition in which the veins and muscles, primarily in the legs, are not able to properly return blood to the heart. Walking becomes painful and difficult. Italian research has shown that grape seed extract can help. Twenty-four patients with chronic venous insufficiency were treated with 100 mg grape seed extract daily. The improvements were visible in 10 days: 70 percent of the patients had less edema and 50 percent had less pain. Bilberry and other bioflavonoids have been used for vein problems for many years in Europe. They may have a similar mechanism of action, or their active constituents may include OPCs.

The body is also protected from toxins by OPCs. Acetaminophen, the active ingredient in Tylenol, is a potent liver toxin, annually causing 75,000 cases of poisoning requiring hospitalization in the United States. Animal experiments showed that a week of pretreatment with 100 mg/kg of a patented grape seed extract prevented liver damage from acetaminophen. Organ damage was assessed by studying liver cells for damage and also by monitoring the animal's health.

Procyanidins and Beauty

More than just disease prevention, OPCs may make us more youthful looking. Oxidation damage causes most visible signs of aging in our skin. By preventing this damage, skin will stay younger looking. One way to achieve this is to reduce the damaging effects of ultraviolet (UV) light. Sunscreen products have incorporated a variety of antioxidants with the intent that they will prevent sun injury to the skin. In one study, grape seed OPCs exerted a solo antioxidant effect at a level of potency on a par with vitamin E-protecting different polyunsaturated fatty acids from UV light-induced lipid peroxidation. In this same study, the grape OPCs synergistically interacted with vitamin E, recycling the inactivated form of the vitamin into the active form and thus acting as a virtual vitamin E extender.

Part of the aging process is the degradation of skin by the enzyme elastase, which is released with the inflammatory response. OPCs specifically block elastase, thus maintaining the integrity of elastin.

OPCs may even help us grow a thick head of hair, if the results of animal experiments apply to humans. Japanese researchers shaved mice and found that 40 percent of their hair grew back naturally. When a 1 percent solution of any of three proanthocyanidins was applied to the skin, however, between 70 and 80 percent of the hair grew back. Test tube studies confirm that OPCs actually stimulate the hair keratinocytes to produce three times more hair than the controls.

The health benefits of OPCs have prompted some researchers to suggest there should be an official recommended optimal intake. Doses used in many animal experiments are 100 mg/kg of body weight, which is equivalent to between 50 and 200 mg for the average adult, according to Bagchi. With the prevalence of refined foods today, our intake is much lower than the amount we likely evolved with, but there has been little attempt to quantify current OPC intake. However according to Corder, one glass per day of procyanidin rich red wine provides cardiovascular benefits. This has been the experience of New Zealand consumers of the wines from south west France. Those wines, which have been tested for the procyanidin content, have up to 330 mg per 125ml serving.

While there is more research to be undertaken the evidence mounts for the healthy benefits of procyanidin. The good news is that procyanidins are abundantly available in various food types without waiting for the processes of commercial certification to be completed. To emphasize - procyanidins are available in beneficial doses naturally. Unnaturally high and unproven to be safe doses are not required with procyanidin.


Wine and Health Research - The Power of Procyanidins - The Real French Paradox

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