It's Monday morning. Where else could we be here on Think Tech? I'm Jay Fidel talking about community matters with Steven Auerbach. He's with UH. He's the interim director of the office of innovation and commercialization, which is something that Think Tech has followed a long, long time, 20 years anyway. Welcome to the show, Steven. Hey, Jay, thanks for having me. Appreciate it. Well, I think it's important discussion. I'll tell you why. Because Hawaii, and there are some people who push against this, Hawaii's future is intertwined with technology, with innovation, with entrepreneurship, commercialization, whether we like it or not. We need to do that. We have needed to do it for a long time. Now there were bursts of light back in the old years, and there was Act 221, Rested Soul, and all these people came from the mainland to do coding and get involved in startups and the like since then it has declined. But your office still exists. And the opposite transfer, technology transfer and all that still exists, still operating. And you have a great future in front of you running it, I must say. This is a very enviable situation because soon enough we're gonna find out that what Jack Burns said and George Ariyoshi said and John Whyhase, all those governors all along the way, they always said the same thing. We have to get into diversification. So you're the diversification man. So tell us, what is the office? What is its range, its mission, its activities? Tell us why it should attract a lot of money from the legislature and the university. Tell us. No, that's great, great Tia. The university is a world-class, what we call an R1 research university. And you've had others on the show and unfortunately with the world-class researchers, faculty, students and staff, we're able to attract 450 million or so in extramural funds. So that's federal, state, private funds that help drive economic development, workforce development for our state. And within the office of innovation and commercialization, which I have the privilege and honor of playing in since returning home, is really all about how do we drive innovation entrepreneurship? And it's not just new technology and widgets, it's also the culture and really the awareness and understanding of the importance of innovation and entrepreneurship for our community. So drives not only societal impact, but economic development and workforce development day. So how do you do that? How you do that in an effective way? So that actually happens. I mean, I see you as the, forgive me, but the hub, okay, in the wheel. And you have spokes going out in all the directions and you're trying to make connections and collaborations, bring people in, bring programmers, researchers from all parts of the tech and scientific world and connect them up, connect them up with others here and elsewhere, connect them up with money somehow, connect them up with buyers and acquirers and what have you. And just build a lot of activity, action is what we're talking about, the more the merrier. Now we haven't really achieved that yet, but you're the hub, you're the hub in that wheel. So what are the spokes and what are you doing to reach all those points around the wheel? Yeah, no, good. And there's no one silver bullet, as you would know. We've certainly transitioned from sugarcane and pineapple. We've got tourism, military that's vibrant. And now we're in the fourth industrial revolution, which is the era of automation, technology, machine learning, AI, IoT. And so our mission is focused on building partnerships between new age, the community, the world, and strategically advancing discoveries and inspiring researchers, innovators and entrepreneurs to create new opportunities for Hawaii and beyond. And like I said in the onset, this is a key asset within the University of Hawaii. We sit within the office of the vice president of research and innovation. That organization is led by VP, Silas Sermos. And within our office, it's really about bridging those connections, Jay. And more specifically, we're fanatically focused on working to create more high quality jobs, diversify our Hawaii's economy. You hear everybody talking about that, research, education and training opportunities for our local communities. And it's really about what I'd like to say. I said there's no silver bullet, but how do we create a sustainable economic activity that's fit for Hawaii, right? And in doing so, we've got to consider both our internal needs, as well as the goods and services required within Hawaii. And then absolutely necessary for us is to develop additional robust traded sectors that bring in external revenue to the state. And so to answer your question specifically, we work with the world-class researchers whether it's out of astronomy, ocean sciences, college or travel agriculture, engineering, computer sciences, ocean sciences, creative media. And we partner with the researchers so they fully understand the technology and the research they're doing, not only has societal impact, but potentially economic impact with the ability to actually commercialize their research and their technology. And so our office has the traditional tech transfer assets where we work on NDAs, MTAs, so non-disclosure agreements, material transfer agreements, licensing agreements to help commercialize that world-class research. Whether that's a startup, that's a spin-out, a licensing arrangement, that's all part of what our tech transfer. And then the other asset within the office, we also have UH Ventures. Within UH Ventures, and I think you're aware of this when Jay, you've got Act 38 and Act 39 that was approved by the ledge. Act 38 allows us to bring some of the conflicts of interest and manage those internally, is a little more flexibility and take more risks. Act 39 allows us to bring money in, federal, private, philanthropy, so we can re-invest that money back to try and diversify our economy. So that's a little bit about how our office is structured. We did bring on another key component, the Office of Indigenous Innovation, and we're really trying to bring in the best practices, cultures and values. That sounds like the full panoply of the university there. So a couple of questions that spring out of that, though. What about patents? There was a time when OTED would actually fund patent applications. You're still doing that? Yeah, no, good question. So if you have a researcher that's gotten some extramural fundings from National Science Foundation or National Institutes of Health or Department of Energy, and if they're coming up with a disc, they disclose their technology to our office, we'll review that for flexibility and uniqueness and then make a determination if we're gonna file a provisional patent or provisional patent and then spend the money to do that. I always wish we had more money to spend on filing the patents because patents are key to drive technology and innovation and diversification. We have a limited budget, right? And so we're constrained and we do a very good job. The team is very focused on what are the key technologies that we think are differentiated, unique enough that align to our core franchises here that I talked about within the University of Hawaii. So if I come to you with a good idea, who knows what, say a device of some kind. And in fact, we talk to people around the University who are working on these things all day long.  So can you fund a provisional patent application for me? Which isn't cheap, but it's a lot cheaper than the utility patent application. So how far can you go? How much can you spend? And you have lawyers in your pipeline there in your bullpen, where you can drag them onto the field and say, here, get a patent for this guy. Can you do that? Yeah, good question. So hypothetically, you say to me, you have that new technology. If you're a faculty student staff, I'm saying, hey Jay, let's continue having conversation. Do the disclosure to really find out the uniqueness of that technology or that invention. And then we do have a very talented staff. We have a couple of attorneys on our bench, actually patent attorneys as well. And then we'll review that for, like I said, uniqueness and applicability based on the technologies and research we're doing here. And then the way we typically work it is we either will front the money and then we cover it based on any licensing royalties that we recoup or the research or faculty may front the money on their end and fund it depending on if they have a startup or if they want to go that route. And then we evaluate those technology, those disclosures and determine how far we want to continue whether it's US, rest of world, Asia Pacific, Europe and file in those countries as well. And that allows us, as you know with the way patents work allows us to really leapfrog and step function the technology at the next level. So you mentioned funding a few minutes ago and I'm interested in that too. First of all, there is a sort of a template deal between the university and the entrepreneur, the researcher who wants to commercialize his idea. And I don't remember exactly what it was but let's say for this discussion it was like half half or something like that where the university kept half of the benefit the ownership of the project and the researcher kept the other half and the university funded the researcher and going down that line you described. Is it still that way? What is it like? If I come to you and I present my idea are we gonna get into a partnership and what terms would that be? Yeah, and it depends on the bargaining unit whether your faculty's staff and or student that doesn't have a bargaining unit then there's different variations. But yeah, there is a collaborative effort that we put together and we put together agreements and share typically the any royalties or monies that is received from said technology that may have a patent. A percentage goes to the inventor. Typically the money follows and follows the inventor. There is a small portion that also goes to university and then a small portion that goes to the unit. So for example, if the School of Ocean and Earth Sciences does invention from one of their faculty a portion goes back and helps fund. And the unique thing about that is it enables that researcher in that unit astronomy so as engineering to continue doing some more innovation in incubating so somebody's flow to those three entities. And I can't do a study with you actually, Steve. I don't want to surprise you but I would like to discuss some case, some company, some entrepreneur. Is this hypothetical or is this a historical? No, this is real. So you don't go too far back because I just came back home five years. So I don't have a lot of historic perspective. Born and raised here, but I haven't worked in academia in tech transfer office. This is my first run at it. I come out of tech. So don't go too far back in history. Well, you also took your graduate degrees here at UH. Yeah. So, no, I mean, is it what's cooking? You know, I remember, for example, digital island. This is way back. This is way back before I was born too. This is back in the 90s. There was a guy who had some technology I think with telecom and he approached the state at the time there was some money in the state for the sort of thing. And the state invested in its company. And it went public. This is in the 90s, it went public. And then the state immediately sold its interest out and made some money, but not nearly as much money. A guy's name was Ron Higgins as Ron Higgins made. And so it was good, but not great because the state had the ability, had the whatever you want to call it, the moxie to invest in his company, actually invest in his company for a share of his company. But it didn't have the sustainability. It didn't have the stick-to-itiveness to stay in there for a little longer where it would have made as much money as Higgins made. But I don't know if that kind of sexy deal happening. Is there anything going on that you can talk about? Yeah, there is, and thanks for that historical perspective and we have not had a home run. And it's not, we're gonna look for a home run. We're looking for many around the basis, right? Across all those sectors I talked about. We're seeing some interesting stuff in agriculture around academics. We're seeing some interesting stuff around COVID and testing and vaccines. We're seeing some interesting stuff around space and satellites. I know you've had people on your show talking about that. We're seeing some interesting stuff coming out of the engineering school around AI and machine learning. We're seeing interesting stuff around data science without our Data Sciences Institute. We're seeing interesting stuff out of astronomy and the list goes on, right? But what's cool about that, Jay, is we've got a very, that's what's good about University of Hawaii that people don't recognize and realize and appreciate. It is a R1 world-class. And we have world-class researchers working on all different areas. We just have to figure out how to be a little more vocal and transparent and show up and share some of this technology at the same time commercialize it, right? And whether it's a small company that's looking to acquire and commercialize that technology or a large company, I can't talk about those large companies we're having conversations with, but they do exist, right? Not every deal is gonna get across a finish line and be a home run, like I said. But along the way, what we're doing was building this culture and this awareness and appreciation of actually building stuff. And when you build stuff and develop patents, yes, and people show up, guess what? That drives diversification. That drives that kind of that attitude. And what better time COVID to do this kind of stuff? Well, COVID is making us rethink our economy and certainly making us rethink diversification. And that, you know, that's, I firmly believe this is the best opportunity in a long time here. You're in a great spot because people are sensitive to this whole idea about diversification. But let's talk a little about, you know, these incubators, a blue planet, and what's the other one? Elemental. Elemental. Yeah. Are you in with them? Are they providing possibilities to you? Are you providing possibilities to them? Are they giving you money? So there's no money exchange, but it's a vibrant ecosystem and we all need to show up and play together and collaborate and we do. There's a good relationship. And so I'll give you an example or a use case. So you can have someone who's a world-class technologist coming out of UH. That's not enough of this is happening. I want to change that trajectory, that they're going through the commercialization process and they may go through some of the great stuff that's happening out at Shyther in the pace with the lease startup and summer launch pad and just getting the interest and vibe around innovation entrepreneurship or they may be a world-class researcher that has a spin out and they're doing some technology. What better way than in our own backyard to then transition to elemental or blue startups? And we do have cases where some of our researchers or faculty, students or staff and their teams are showing up in those accelerators and then it happens to be in Hawaii, right? And then you start getting into phase one, phase two, phase three of potential federal monies, SBIR, small business investment, STTR and those types of monies that can then continue to invest and nurture the research and get them to commercialization efforts. So it's absolutely dialed in to the ecosystem partners. We're very strong connection together and we cannot do it solely alone. We've got to do it together as a whole, I call it whole of the community. Yeah, we had a fellow who got some, he got some substantial SBIR money recently and he's working on sensors that are going into satellites and the like and various other high tech electronics. And he's not, go ahead. He's a good friend, you saw, right? Yeah, not just scientific. Yes, right. And it's not a university project, but somehow it's connected. So my question is here you have an LLC, it's separate. And it sounds to me like in terms of funding, he's doing pretty well in his space and he's likely to do more and better later. But query, what is the university's support of him? What is the university's connection? What is your support and connection with that kind of, what do you call it, spin-off? Yeah, so he's a PhD from the University of Hawaii, came out of physics, very, very bright guy and he's found a niche around these sensors. It is using CMOS and, you know, Wafer Technology to put in the satellites. And so he'll actually work with some of our postdocs and researchers, hire them based on the SBIR STTR money that he's bringing in to continue to evolve his research. We're having conversations that I can't go into detail about right now on this show, but how do we continue to develop that relationship to the next level? There could be spin-offs or spin-offs from the technology he's doing. He's very focused, which is the right thing to do around his unique technology. But from a workforce development standpoint, bringing our students and researchers to work with him on some of this technology is another one. How do we bring in some of the other folks from physics or engineering, which he's got strong relationships with. So they start thinking about innovation entrepreneurship so they can do a spin-out. It's kind of what I call a ripple effect just by that one knowledge scientific leading the way he's a doer and he's got a great attitude to drive innovation entrepreneurship and a strong environment. A tremendous guy. It was really good to talk to him. And all of these other areas you mentioned are so right for the possibility for Hawaii. And Hawaii does have smart guys like Isak who can push to the frontier, except in one area. What's that one area, Jay? Astronomy. Okay, and the reason I say that is for a piece of discussion here. Astronomy, there's resistance on astronomy. There are people who think astronomy is not important. And they have other agendas and they fight even now, even now they fight against astronomy. And I say to myself, this goes to the kind of thing you're doing with Waipahu High School. This is the kind of thing you have to get into the minds of local kids early. You have to show them. It's not just unattainable. It's attainable. Some of the best scientists I have met from the state of Hawaii are from Hilo. I cannot understand that. They come in legions to the science fair for years. What is it about Hilo? It's a few good teachers. That's what it is. And so if we had that kind of connection, and I know that Waipahu has some great science teachers you must be familiar with all of them. And so the question is, how do you build a culture where kids in this state, and thus soon enough adults in this state will embrace science? You know, we have a national problem about embracing science right now. Hawaii has to be way ahead of that. How do we embrace science and get our kids to believe in it? Yeah, great question. You know, I'm a Kalani Falcon graduate.  I did not learn. I wish I had learned this early on. And this is something when people ask me to talk or come and give back in the community. We need to start this early, right? It's middle school with STEM. It's high school with STEM and innovation entrepreneurship or design thinking. It does not happen. For me, it happened early mid-career at Hilo Packard. I was forced to do it because we were facing significant headwinds and our business was tanking. It was a burning platform. So we brought in Steve Blank and Kawasaki and others and we started learning about this lean startup methodology. Back then we were doing all waterfall software development. We had to pivot and shift to agile. So almost too late for me when I started vibing on innovation entrepreneurship, to your point, if we can start earlier and talking about innovation entrepreneurship. And there's a lot of folks that like to build stuff. If you're building Legos, that's a great start. You're building something. If you like to plant Kalo, you're building something. You're building a farm. If you like to work on cooking and culinary or designing homes, that's building stuff. That's that skill set that I really want to try and nurture at the earlier age. And here's a fascinating thing. There's a handful of schools that we're working with. They have entrepreneurship clubs. Imagine that entrepreneurship club if they find out UH, which we do have entrepreneurship clubs. If I can graduate from that high school, stay in Hawaii, as part of my community, join the entrepreneurship club. And I may have had an idea of a widget or a service or product that I thought of in high school. Now I can go into the world class four year university, University of Hawaii. Or if you want to go to a two year college, community college, same thing, learning this stuff. Because that's another topic I'm pretty passionate about where innovation entrepreneurship exists.  You take advantage of all the world class assets we have here. Surround yourself with world class researchers. Continue to incubate your idea. Imagine if we were to get funding and scholarships. Some of those students, they stay in Hawaii, stay at UH and do innovation entrepreneurship. Big thing, right? Absolutely. So have you seen the serial on Netflix? Gee, I hope you have. It'd be great if you have. Called Halt and Catch Fire. No, I haven't. This is fabulous. It's a serial that's got two or three seasons to it. And it's about this whole thing about entrepreneurship back in the early 80s when computers were just getting started. And when guys work for IBM and they split off IBM and they come in, they form their tiny little company and make a computer that competes with IBM. This happened again and again and again. And they fail a lot of the time, but they learned and they filtered into the industry in general before you know it, they populated companies that made them richer than your wildest dreams. And it's the whole story of that. And it's not a documentary, it's fiction, but it picks up on all this technology you're talking about and all that entrepreneurial, what do you want to call it, essence, that entrepreneurial drive that you need to have. It's not only knowledge, it's something inside in your gut that makes you work till two in the morning. That's everything. So I tell you a short story here. Here we always are looking for a new software. We found, we thought we were a video company, nah, we're a software company, we use software consumers and adapters and integrators, that's what we do. And we can't really do the job without the software. And then I suggest, I'm sure people have said to see you for years, that you can take any company, any operating company and bring a software guy in there and make it better, change it completely and make it sing and dance. And so we always looking for software like that. So I was looking for specialized software and I think I found it at Istanbul. I'm not kidding. Really? Right, they get on my machine with TeamViewer. They help me install it and configure it and from Istanbul they do this. Well, I've heard a lot of coming out of Israel, having much coming out of Istanbul. Anyway, keep going. Well, point, and the competitors were in Serbia or Moscow and there were others too and odd places. Point is, it's global, okay? Yeah, and these guys are really no better qualified than we could be. We could be another Istanbul. So my question to you is if I'm looking for software that's exotic, that's well thought out, that's really clever, can I find it here? And can I find it here now? And if not now, then when? And how? Yeah, no, that's a good story. I know a lot of stuff coming out of Israel. I hadn't heard about Istanbul. But out of our computer science department, out of our computer engineering department, people are working on software. Different use cases, right? There's Dr. Jason Le, who we believe who we're gonna have on the innovation of the new normal, which I gotta talk to you about still. He's gonna be, he has some good software students and researchers working on some software. So yeah, there are pockets of it here. I'd like to see more, especially as AI continues to kind of rule going forward. And with the fourth industrial revolution that I talked about, I'd like to see more. I think we can do more here in Hawaii. Okay, now you've done a great segue actually, Steve, into the conference coming up soon. The Innovation Conference you're setting up at UH. Tell me what is it, who's gonna be there, when is it, and so forth. No, thanks, Jay. This is pretty cool. It's back to this whole culture of innovation entrepreneurship. And so we're gonna really show up is what I call it. It's called Innovations for the New Normal. So next week, November 9, 10, 12, and 13, Monday, Tuesday, Thursday, Friday, we skip Wednesday, for about two hours every morning, 8 a.m. to about 9 30 or 10, there's gonna be four days of GenPAC research innovation topics. Day one, or session one on the ninth, we're gonna have President Lassner, he's gonna open up.  And then we jump right into this topic around resilient food systems in the COVID era. And so this is a free conference. People can jump dial in for one or more of the sessions. Day two, Jay, if I could keep going on day two, because I'm excited about this stuff. We go not only from resilient food systems, but now we're going into innovations in healthcare. And so we have Dr. Amy Grace. I don't know if you've had her on your show. If not, we gotta get her on, but she is a local girl, Stanford doctor, and she's leading our health initiative here at the university, and she's bringing a dynamite panel of folks coming around to talk about Hawaii pre-pandemic, innovative ways that UH and the health community in Hawaii have worked together to expand virtual care going forward. And then session three, I have the opportunity to tee up a good friend of mine, Steve Blank. And so this is the Thursday, 8 a.m. And I'll do an ocean side chat with Steve Blank. We're gonna talk about creating new businesses and reinventing existing ones. And then I go into a panel. I've got Craig Tenderrita. He's the CEO of EK and Team Praxis. I got Peter Dames. He's the EVP over at CERVCO. I have Chris Lee, who's the director of the Academy of Creative Media. I have Dr. Jason Lee. I talked about earlier. And then Captain Kurt Moll from NSA Hawaii. And then Jay, bring it home. Friday, last day, culminating event. We actually have Guy Kawasaki. I talked about him before. He's coming in. We're gonna do a 10 minute, how to be a remarkable inventor. And if you have not talked to, talked with Guy or heard from Guy, local boy, Elani Gratt, Dynamite speaker. Dynamite speaker, I've seen him a number of times. He's terrific. And he's, he's picked up surfing. So he's, he may have talked a little about his surfing fun. And then the Silas, the Silas closes it out on with President Lazner and Rich Wacker and some other key leaders and around the path forward for Hawaii So that's it in a summary. I know we're running out of time, but I hope folks tune in. It's, we're capping at 1,000 registrants. It's free. Last week I heard we're over 400 plus that have already signed up. So if your listeners are out there, please sign in. It's free. It's great, great topics. Yeah, that's great. I'm so glad you mentioned that. So where do I go? So the link is hoi.edu forward slash research forward slash innovations dash for dash the dash new dash normal. Okay, for the new normal. All right, thank you, Steve. It's great to talk to you. And I look forward to more discussion. I look forward to at least seeing part of that huge, magnificent, ambitious program you're setting up. This is what we need to do when you're doing it. I really appreciate that. Yeah. You know, Jay, let me just one final thing I wanted to say, thank you for allowing me to show up and be here. You do so much for the community. I've only been back home for four or five years, four plus years now. And I've tuned in, keep up the great work because this is important stuff for our community and for societal and economic impact. And thanks to you for doing this kind of stuff. Thank you. All the best. Aloha, stay safe. All right. Aloha.


A new type of prophylactic vaccine has been developed which can rapidly control multiple types of viruses, including SARS-CoV-2, RSV, and influenza. This glycolipid, called 7DW8-5, works by binding to CD1D receptors on antigen-presenting cells and activating NKT cells, which then produce a cascade of cytokines and chemokines that help fight off the virus. This approach is effective against multiple viruses and does not require any pre-existing immunity. It could potentially be used to quickly control outbreaks of viruses such as SARS-CoV-2, RSV, and influenza, even before vaccines or drugs are available. This article was authored by Maria Seiji, Manoj Esne, Kozio Masuda, and others.


Jaycee Penny is one of America's largest retailers and would you believe that it got its start right here in Wyoming? Behind me you will see the first store that opened in April of 1902. James Cash Penny, the founder of Jaycee Penny's stores, grew up in Missouri. He was diagnosed with tuberculosis so was forced to move to the drier climate of Denver. There he worked for a dry good store called Golden Rule. The owners liked him so much that they encouraged him to join the partnership and start a new Golden Rule store in Kemmer. This store was unique because they accepted Cash only, no credit. James opened several stores in other locations. His challenge to each of his store managers was to find another honest, hardworking man to train to be manager of a new store. After only 10 years there were 34 stores and sales surpassed $2 million. The stores began as Golden Rule stores but the name was changed to Jaycee Penny in 1913. The Jaycee Penny company morphed from a small store in Kemmer, Wyoming to a chain of thousands of stores with the headquarters moving to Salt Lake City and eventually New York City. With a motto of honor, confidence, service and cooperation, it's no wonder that the first Jaycee Penny store is still open after over 110 years. Come and check it out next time you're through Kemmer. From the University of Wyoming Extension, I'm Mae Smith, Exploring the Nature of Wyoming.


Ladies and gentlemen, the President of the United States, escorted by Frank Berenkoff and Keith Brown. Ladies and gentlemen, I know many of you have had the opportunity, particularly during the President's State of the Union address, to observe him as he yearly honors heroes of our country. He usually has them sitting in the balcony and he points them out and tells their story. I have the pleasure of introducing the President to you this evening and I thought there's no better way to express it than to say to you that tonight I give you the most valuable asset and hero of the Republican Party, the most valuable asset and hero of the American people, the most valuable asset and hero of every person on this planet who loves freedom and democracy. Thank you all very much, but I really think in view of what all of you have done and are doing, are the things we believe in, I should be cheering you. And if you were in the balcony and I had the Congress here in front of me, I'd point you out. And that would keep faith with what I've always believed about them. You don't try to make them see the light, make them feel the heat. Before I get into my remarks, I know that Don Regan, this earlier today, told you about the Iceland trip that's coming up now as a result of getting an American citizen home. He's well on his way. In fact, I think he's probably arrived. I know I'm going to be seeing him tomorrow, Nick Daniloff. There seems to be some effort already to try and portray it as that we made a trade, him for the spy. That's not true. We traded the spy for somebody else. But we got all of those things done only because Mr. Daniloff came home. And they knew in advance that everything was on hold until he came home. But now, grateful as I am for all you've done, you know, I've been here too long. I'm going to ask you for more if you just... And not of what you've been of that same thing. But there's a little matter of a veto that I put on the other day on the sanctions bill. The House of Representatives has already voted to override the veto. Our fate lies with the Senate. And if any of you just happen to be talking to some of our Republican senators and lean on them a little bit about voting to sustain that veto, I'll be very, very grateful. Because things don't look too bright right now from here. And we haven't been able to, I guess, convince enough of them that the sanctions that they have voted and are imposing are going to hurt the very people that we're trying to help. And I think they're apt to open the doors to all kinds of radical factionalism over there. And we were in our making some headway. I received a letter one day from Boutelezzi, the leader of the Zulus, the biggest grouping in South Africa. And it was the most statesmanlike letter that I've ever read. And he, speaking for six million of those persecuted blacks, told me that all of them said no to sanctions, that this would destroy everything that they're trying to gain. So if you just happen to meet a senator. But now enough of that. Thank you for being here with you and having this opportunity to express my appreciation for all that you're doing for our party and for our country. The Eagles program is now in its 11th year. And since its inception, it has raised $55 million for the cause. You Eagles have been the backbone of the Republican Party. Your generosity, sense of responsibility have been crucial factors in the success that we've enjoyed, especially in these last five and a half years. As a story, you know, about a chicken and a hog. They both decided to go to town, thought they might like living in the city, and they spotted a sign on a restaurant that said, ham and eggs, a dollar and a half. And the chicken suggested they go in and apply for a job in there. And the pig declined. He pointed out to the chicken, he said, for you, going in only requires a contribution. He said, for me, it's a total commitment. All of you can be assured that your total commitment is much appreciated by this president and by the many others in our party that you've helped over the years. This year, of course, is a make or break year. And I hope you'll join with me in pulling out all the stops to make certain that we retain control of the United States Senate. In these last five and a half years, we've managed to pull America back from the edge of an economic catastrophe. We kicked the tax spend and inflate crowd out, set our sights on growth opportunity and freedom. But the old liberals are waiting in the wings, ready to undo everything we've worked and sweated to accomplish. The Republican National Committee, which is a major recipient of your support, has embarked on a campaign this year that is unprecedented in the history of American politics, spending five million dollars to identify, contact, and deliver the Republican vote across the country. In cooperation with the Senatorial Committee, the RNC is sending out 12 million pieces of mail and making 10 million phone calls, as well as making sizable contributions to selected races. If no one has told you yet, I have an allergy in Washington next to Sacramento. It's the allergy capital of the world. But in cooperation with the Senatorial Committee, the RNC is, well, I've told you that, they wouldn't be able to do this without your support. So thank you. And a special thanks to Keith Brown, who both as an Eagle and as Finance Chairman serves above and beyond the call of duty. I also want to mention how pleased I am that Frank Ferenkoff is going to seek re-election to a third term as National Party Chairman. I don't know whether it did help a little. Well, we all know what an outstanding job he's done, and I believe it's in the best interest of our party that he stay on as Chairman and continue the programs that he's begun. I hope that this year, as important as it is, each of you will make it a special point to get personally involved in at least one Senate race. You can make the difference. And this year, that means you will determine if our country continues to make progress and move forward or is pulled back into the muck of collectivism and redistribution. Some of our incumbents, public officials who anyone should be proud to support, are in close races. The other side is throwing everything into the battle.  And when they're on the other side, they're called public-spirited philanthropists? I think we can all be encouraged that at long last the American people are waking up to some fundamental values. Few, if any, for example, still believe that taxes can be raised and only the other guy will pay. You know, that Rob Peter to pay Paul. Peter went bankrupt a long time ago. Few, if any, for example, still believe that taxes can be raised. As I say, somebody else will pay and candidates who offer something for nothing and quick fixes are being met with skepticism. We've made enormous progress since the days when government spending was in many minds synonymous with job creation. Our economic recovery program has already created over 11 million jobs since November of 1982. Now that's what I call a Republican jobs program. We share a vision of a strong growing opportunity filled America. Young people are filling our ranks and all the rallies that I've addressed in this campaign so far, wherever, out in the country I've gone, it's just wonderful to stand up and see how many youngsters, young people, are out there in those crowds. People from the other party, finding the leadership of their party is totally out of sync with the rank and file, are changing registration and joining our camp. There's a story you may have heard, a political story about a young boy was selling puppies outside a Democratic fundraising dinner. And he held up a puppy as the guest filed out after the dinner and gave his pitch Democrat puppies for sale. Anybody want to buy a Democrat puppy? Two weeks later at the same restaurant, the Republicans were having a fundraiser and the same kid was there trying to sell the same pups when he was called on Republican puppies. And a reporter who'd been at the other dinner too said, how can you do that? He asked him, he said, you had these same pups here two weeks ago and now they're Republicans and they were Democrats then. Kids just said, now they have their eyes open. Well, between now and election day we got to make certain that we open the eyes of the American people and get our people out to vote. This is a watershed year. If we keep control of the Senate, our cause will be on the offensive for a generation. So now's the time. And I know I can count on you. And I thank you for all you're doing for our party and for our country. And I'm not going to leave you without one more story though. It's one that I've been telling, if you've been to some of those fundraisers I've been doing, you've already heard it. I've been using it. I like to describe the leadership of our opponents. It's like the three fellows that came out of the building to their car and found they locked themselves out of the car. And one of them said, oh, somebody get me a wire coat hanger. I'll straighten it out and I can hook the handle. And the second was, you can't do that. People will see and they'll think we're trying to steal the car. And the third one said, well, we better do something quick. It's starting to rain and the top's down. Thank you very much again. Mr. President, we thank you very much. We ask our Eagles to submit questions, written questions. And I'm going to draw them out of the box here and you may or may not want to answer them. I just want to assure you that Frank and I wrote any question that's in this box. The first question is from Mr. K. R. McDonald in California. He wants to know, short of a depression, is there any way to stop government spending? Yes, there is. And we've been trying for it and we've come close. The first step is something that 40, let me see. There's 43 governors have and I had as governor of California. Line item veto for the president. Right now they're up there. I haven't had a budget since I've been here. We sit around the cabinet table for hours and hours. It's our job. The people that run the programs, we decide on a budget. They're the ones that run the programs that the Congress has passed. They say they can do it for this figure. We send it up to the Hill and the Democratic leadership boastfully says it's dead on arrival and puts it on a shelf and then they start out and we wind up with a continuing resolution. Now that is where they pass a bill that's supposed to for either part of the year or the whole year. And in it, they put all the appropriation bills. You don't get a chance to vote on a single bill and say no to this. They dump them all in but then they add in all the things they want to do. And this bill, this continuing resolution that's before the Congress now I'm sorry, at midnight tonight the government is out of money. There is no way I can sign that bill. It would be so destructive and so many of the things that we've tried to do that have nothing to do with budgeting. But that and then once that is passed an amendment for a balanced budget for our Constitution. 49 of our states have that in their Constitution that the budget must be balanced. And this time when it was proposed this time it lost by one vote in the Senate. So here again those two things because I'll give you an example and I'll try to make the answer shorter but when I was governor of California with the line item veto they put things in there that can't stand the light of day. So they're hidden in there and you vote for the whole package. In eight years I vetoed 943 times on line item veto and was never overridden once. Now in California it takes a two-thirds majority to send the budget to me and it only takes a two-thirds majority to override my veto but they didn't dare when those items were out there all by themselves and they had to apparently be voting for that particular item. 943 times. Give us those and I guarantee you we can get back to where the government isn't spending so much money. The next question is from Dieter Meyers Gonzalez also from California. This isn't rigged. Is it true you'll be residing at Pickfair when you retire to California? Then he goes on and says seriously do you believe that the new tax bill is truly a blessing and a benefit for corporate America and why? Oh boy. Ignore the first book. I do believe and I won't be living at Pickfair. I do believe that it is a benefit for the nation. When I was in Hollywood making all that if money most of the time that I was making it I was in the 90% bracket and I know how many times a script had come and I was awfully tempted but I'd say no. I'm not going to go out there and make another picture for ten cents on the dollar. I'm already in that other bracket and this happened to an awful lot of people and I think that now this is the first common sense in a long time. We wouldn't need some of the loopholes that they all were created because they had to be some answer to the high brackets of the old tax system but now 28% top tax and I know that there have been some things that have been taken away that business things might be detrimental and yet the National Chamber of Commerce has endorsed us and wants the program and there's not enough being said that from 46% in the corporate tax it's going down to 34% so I think that some of the so-called tax shelters or tax breaks can be done away with and we'll all be better off and I know this that our tax reduction in 1941 that was passed is the biggest single factor in the recovery had and at the lower rates the government is getting more money in total and there was a fellow named Eben Caldoun back several hundred years ago who said in the beginning of the empire the rates were low and the revenue was great at the end of the empire the rates were high and the revenue was low. This next question is from Nelson Texas. Dear Mr. President are you aware that an increasing number of young couples cannot get a stake in America by owning a home of their own what should our national policy be to give more of our young people a better opportunity to own a home of their own? Well we know that the present average price of a home has been made because of the years of inflation and we took it down from more than two double digits down to where it is for the last 12 months I guess it's been about 1.6 and I hope we can eliminate it entirely then the interest rates that we're making it impossible for them to own a home we have brought those down to the lowest that they've been in a few decades and they've got to come down even further and then I think that they will be able to to buy a home because for the most part wages and salaries and income has kept up with that high inflation and it's not going to go back down just because now we're ending the high inflation to stay where it is but he's right about that that's one of the most basic things in our society is the ability of people to own that piece of ground they stand on next question when do you plan to sign into law the tax reform bill submitted by Joseph Gildenharm all I'm waiting for now is after they pass it then they have to put it through the legislative council and all they have to make sure that all the words are correct in it and it all has to be drawn up and it's a rather thick bill and I'm just sitting with a pen open already on my desk for it to arrive alright so this is the last question submitted by Carol Alicio San Diego California do you feel the Soviets are behind the drug infiltration into the United States my father had captured a German officer 1942 he said the Russians will be our real enemy and destroy our country from within through our children and with drugs I know that probably the press would sound off and go into fits if somebody suddenly came out and accused them of this right now but I also know that some years ago in California someone had obtained a textbook that was used in the geopolitical institute in Russia where they train their agents and where to go out into the other the rest of the world and try and influence it to communism and one page of that was so telling that that page was reproduced and delivered to the Los Angeles County school board and it was made public in most of the schools at that time and the page was telling the agents that they were training that they must they could win by just getting the teenagers one generation and if they could get one generation they would have that country forever and some of the things they said were that they must take away from the young people allegiance to family or to community or to their school they must empty them of anything that they could believe in and then when they had them in that condition then they would give them a cause to believe in their cause socialism and they said to do this they must use everything they must use sex they must use drugs and that was they had quite a few lines on that all of these things to get our teenagers and so I can't help but believe that they must at least be encouraging however they can the flow of drugs not only to this country but to the other democracies in the world but certainly to this country I tell you Nancy for five and a half years has been working so hard on this and has mostly been with the young people but she has come home in these later days just horrified at how far down the age group is and when she told the story to me of a fourth grader who is not only a user is a pusher and believe it or not he's in the classroom with a beeper and when it beeps he excuses himself because that beep means outside he's got a customer now the stories are horrifying of all of this on the other hand and this is why we launched the crusade the other night Nancy was talking to a bunch of students just kids in Oakland California and one of them asked a question and said well what can we do they start telling us and asking us to use drugs and Nancy said well just say no well today there are over 10,000 just say no clubs in schools across the United States but I if I would just add one more convincing thing to that specific question I have just been meeting with and talking today to one of our neighbors in the American country and as so many of those countries are they they have a guerrilla force in their country that is fighting against the existing government and he told me that increasingly they have found that there is a tie in now between those guerrillas and the international drug network that one funds the other and the guerrillas then have bodyguards and so forth and they make sure that the flow of drugs can get out of there and head for our country so yes and I could think of a lot more bad things that the communists are responsible for but I just I'll finish with another story then I have to leave the I have a new hobby now I have found that many sources like our diplomats and all stories that are told by the citizens in the Soviet Union about their own government which reveals how cynical they are about it and the latest story that I learned was the one of they came to Gorbachev and the Kremlin and they said there's a woman here and she says she will not leave the Kremlin until she sees you well he said bring her in so they brought her in and she said was communism invented by a scientist or a politician and he said well I suppose it was a politician she said that explains it the scientist would have tried it on mice first thank you sir I'm I'm sure that everyone in this room will join me and not only in thanking the president but bringing back to the White House a message to Nancy that we love her and we're so proud of the job she's doing for the young people of this country


Hi, everyone. Basel Chapman here, sitting in for Tom O'Brien. I usually do the 10 o'clock to 11 o'clock Tiger Technicians Hour Eastern time, that is. And my service here is the opening call, my daily newsletter, very thorough newspaper, newsletter that goes through all these different aspects of commodities, et cetera. Now, what we're looking at is the Dow. When you consider this big move up in the green candle, let me do a couple of things, as I'm saying that. I've been for about three weeks or so now. Usually on a Tuesday I'm interviewed by Tom and I discuss, no, this is not the chart I wanted. I discuss some of the technical aspects of the Chapman methodology. And if you're looking at this chart that I'm showing you right now, this is a daily chart. And instead of the price, the bars that you usually see or the candles, I've just got a thick gray line, and that represents the closing price of the Dow. And what I've been talking about is that when this green 9 EMA is above the 14 period moving average, it can take quite a while, especially if you make an M-shaped pattern for it to turn negative. And negative will go from green to pink, whether it went to pink and it's still pink on that sharp move down. And there's a divergence now, because if you're looking at the Dow, which is now up $3.00 at $33,628, I'll go to the charts in a moment. If you look at the S&P using just this very simple technique, look, the S&P is still green. It went for a date, went red or pink. And now it's back to green, so the 9 is still commanding the weight of evidence of the buying power. That's the way I look at it. Look at the QQQ. It never even turned pink after that. For one day it did, but while the Dow late April early May and the S&P were down, this held beautifully. And even now it's making an M-shaped pattern in price, but that 9 period moving average is still very nice. Look at the IWM, the Russell 2000, now it's unchanged, 174.09. That it turned negative and it's been negative and it will take quite a bit to the left to go to 175, probably 176.80 to start crossing positive again. Otherwise it remains in a sell mode. Now let me do a couple of other things. I just wanted to show you what I'm really looking at. No, but I wanted this chart right here. This is what I show my subscribers. In fact, let me show you what I do. Every day I have my traders corner plus the chart of the Dow or whatever stocks or instrument we want to be buying or shorting. So this is what I give. This was yesterday's close.  There's a chapter with Roman candle, they were closed nicely above it. That was a big good, that was a really strong sign. Friday, Monday we made a slightly lower high. So that's called gray peak A because the MACD and stochastic was still very weak and the line was under the 14. And I said, let's see, if the Dow today, if the Dow is holding a minus 60s or more after 1.30pm, the chances increased for a week close. However, if there is a bounce from this early pre-open selling pressure to flip to positive, that alone will force some short covering, allowing for a much narrower close, maybe even up. The Dow is right now minus seven. So within the context of my work, I always try to identify the lowest low bar, count each success to be higher peak, alphabetize them sequentially ABCDEFG, but it's that fourth highest peak PT where other things can happen. It can go quickly to an E and that'll be the same sort of thing. We'll come back to that in a moment. Let me just show you where we are right now. So the Dow went to this peak E and it went to a technique that I call Chavweight inside track repellence zone. Look at this green and pink. You see that resistance? Boom, 34,257 in the Dow and it pulls back and it takes out the risings like a wedge formation, this rising wedge Chavweight inside track support level. Took it out and now it's trying to break above it. That's going to be the big thing. Cannot do it. Look, the MACDs are the daily chart. MACDs week, Stochastics week, unbalanced volume is really poor, very weak volume. So Christ has to lead the technicals in this particular instance and that would say by Tuesday, if the Dow is not trading the 30, say 33,619, it would have to get above this trend line. So 33,900, if it hasn't gotten into that area, that says the sideways choppy pattern that I've been expecting for this particular phase from last week, that could be unfolding. And if you look at the weekly chart, see the V-shaped pattern, it's losing momentum to the upside, but the Stochastic and MACD and the 9p removing areas are all very positive, yet the price hasn't been able to get that momentum to cross into the 34,300s, 400s. So I'm watching this closely in the monthly, finally it's trying to attempt to break out of the resistance. Okay, now we'll just do this quickly. S&P, S&P at this particular point, it's had a really good retracement from the 41,086 high down to the 40, 4050 area, low announced balance, it's at 41,26, down 11. Here again, the 9 period moving average is good, the MACD is not, the Stochastics week, but price is the arbiter of the trend, so far it's holding very well. You want to see by Friday afternoon, maybe Monday sometime, you want to see at least a test of the 41,58 level, that's not too bad, there's only 30 points from here, it's about 300 down points, and on the downside, definitely you want to see it hold the 41,20 to 41,00 level over the next couple of days. QQQ. NDX had Fabulous, it had Matter, it had Microsoft, it had a couple of really good earnings releases that helped, even if it was just a handful of stocks that led the way up, it did lead the way up, and you went to the inside track repellent zone, that says by about Tuesday of next week, Tuesday, maybe even Wednesday, give it a whole week, you want to see trading, not just the balance, but trading the 325 area, that's only four points away, but that would say you've broken the resistance, the weekly chart is strong as it is, it should continue higher, it's got tremendous support in the 319 to 317 area, looking out, I wouldn't be surprised if we start to make a trading ban, a much wider trading ban, between the 327 area and maybe the three, oh you could even go down to the 310, retest the 310 low from April. All right, let's do the IWM, the Russell 2000, trying to rally, it's just it's not a good pattern, this is that H pattern that I always talk about, where you come down sharp, you make it on formation, so far that's held in the weekly chart, the daily chart, the same thing, you want to see a good rally going into the 178s by Friday or Monday, definitely has to hold 167, I will be back in a moment, dials down 8, SOP's down 12, I want to be talking about K-R-E, that is the regionals, SOP regional banks, I'll be back, fossil chapter sitting here for Tom O'Brien, be back in a few minutes.