News Analysis
January 26, 2006
BusinessWeek.com
Link

Sluggers Among Large-Cap Growth

Funds focusing on these stocks appear to be primed for a comeback. Here are some that earn high marks from analysts

Large-cap growth funds finally may be due for a comeback. After all, the companies they invest in -- typically ones with market capitalizations of $10 billion or more and strong growth prospects -- were out of favor for almost five years. According to Boston-based Financial Research, investors yanked $10.8 billion out of these funds in the first 11 months of 2005, while pouring $18.7 billion into their large-cap value brethren.

Now, the beleagured funds have improving performance on their side. Growth stocks overtook value stocks in the second half of 2005, according to data from Chicago-based investment researcher Morningstar -- and many Wall Street pros don't expect them to look back (see BW, 12/29/05, All Aboard the Growth Train"). In a recent survey of 112 U.S. money managers, Russell Investment Group found 80% favored large-cap growth stocks above all others.

BARGAINS GALORE.  Larger companies happen to be paying higher dividends than they did in the past, thanks to a 2003 tax law. And historically, large-cap growth tends to do better in the later stages of a market expansion, when investors are willing to shoulder more risk (see BW Online, 12/21/05, "Investing Trends to Watch in 2006").

At the same time, large-cap growth stocks are cheaper in a relative sense than they've been in years, some analysts say (see BW Online, 1/11/06, "Equity Funds Reveal an Evolving Market"). "There are a lot of bargains out there in large-cap growth stocks," says Brian Gendreau, investment strategist for ING Investment Management.

So where should fund investors put their money? There are 1,000 large-cap growth funds, and they come in many shapes and sizes. Some large-cap growth managers are willing to bet on companies perceived as riskier in exchange for higher returns, while others play it cautious. Smaller asset sizes might make some funds more nimble. And of course, expenses vary.

"ALMOST BORINGLY STRONG."  A trio of T. Rowe Price funds earn analysts' stamp of approval. Philip Edwards, managing director of Standard & Poor's Investor Services, likes T. Rowe Price Growth Stock (PRGFX ) for its solid performance and low risk. "It's consistently and almost boringly strong," he says. Manager Bob Smith has beaten his peer average by about 3% since taking the helm in March, 1997. The fund has a modest 0.72% expense ratio.

Morningstar senior fund analyst Paul Herbert points instead to T. Rowe Price New America Growth (PRWAX ). At $873 million in assets, it's considerably slimmer than its $10.7 billion big brother. It has an expense ratio of 0.91%.

The fund also holds a hefty tech stake, with more than 20% of the portfolio in software and hardware stocks. Herbert sees tech stocks leading the way in case of a large-growth rebound.

ENERGY-PRICE IMPACT.  New America Growth manager Joseph Milano agrees the economic underpinnings are right for large-cap growth this year. But he cautions that runaway energy prices may still curtail the stocks' ascendance. "When we're looking back, one way or the other we're going to say the returns have been dictated by what happened in energy," he says.

T. Rowe Price Blue Chip Growth (TRBCX) has also posted consistently solid returns, outpacing a typical peer in four of the last five years. "This fund does a pretty good job of being selective along the way and not just taking the largest companies out there," says Jeff Tjornehoj, a research analyst with fund tracker Lipper. Managed by Larry Puglia, this large-cap growth fund has an expense ratio of 0.85%.

Investors looking for something more cautious may want to consider ABN Amro/Montag & Caldwell Growth (MCGFX). Morningstar's Herbert calls it "an old-school growth fund," because it invests in classic growth stocks such as Procter & Gamble (PG ) and Johnson & Johnson (JNJ ).

AGGRESSIVE PEER.  The fund's skipper, Ronald Canakaris, hunts for bargains like a value manager. "We're not willing to pay any price for growth," he says. So he buys shares of companies with reasonable valuation as well as strong earnings growth. The fund's returns lag some rivals because it takes fewer risks, but its expense ratio is a relatively low 1.02%.

Almost the exact opposite in terms of risk and return is the doughty TCW Galileo Select Equities (TGCNX). "If you're more interested in an aggressive large-cap growth, this is the other side of the universe," says Lipper's Tjornehoj.

The portfolio contains only about 25 stocks, with Progressive Auto Insurance (PGR ), Genentech (DNA ), and Yahoo! (YHOO) among its largest holdings. Its annualized three-year returns top 20%, placing the fund in the highest 6% of funds in its Morningstar category. And it has a below-average 1.2% expense ratio.

GROWTH GIANT.  Another fund for intrepid investors is Harbor Capital Appreciation (HCAIX), subadvised by Jennison Associates. "It's a fund you have to take on a little more risk to enjoy," says S&P's Edwards. But the returns can be worth it, as the fund trounced its category average each of the past three years. Manager Spiros Segalas has steered the portfolio since May, 1990. Its expense ratio is 1.1%.

The elephant in the large-growth room is Growth Fund of America (AGTHX), and for good reason. American Funds' $128.1 billion flagship ranks in the top percentile of its category for 10-year annualized returns. It has a low 0.66% expense ratio and a front-end load of 5.75%.

S&P's Edwards credits the fund's multi-manager approach, which lets nine different portfolio counselors each pick stocks individually. But he suggests caution regarding the fund's ballooning asset size.

TIME TO REBALANCE?  Morningstar's Herbert also recommends two smaller American Funds offerings, New Economy (ANEFX ) and Amcap (AMCPX ). Roughly a quarter of both funds' holdings received four- or five-star ratings from the research outfit's stock analysts.

While the shift to large growth stocks would be welcome news for the group, fund watchers advise against trying to chase the market's twists and turns. "It's good to have some exposure to large growth in your portfolio independent of intraday dramatic moves," Herbert says. Indeed, a rebalancing of your portfolio to take advantage of the comeback of growth stocks, especially if it hasn't been touched in a while, could boost your returns down the road.

News Analysis
BusinessWeek.com
January 12, 2006
Link

Coping with the Alternative Minimum Tax

With millions getting hit by the AMT, a number of funds are specifically geared to avoid the pain. Here are some to consider

The alternative minimum tax may soon be coming to a Form 6251 near you (see BW Online, 2/16/05, "Meet the Enemy"). Enacted in 1969 to snare wealthy individuals who had managed to deduct their way out of paying any taxes whatsoever, the controversial parallel tax doesn't adjust for inflation. So it's hitting more and more middle-income earners

An estimated 3.8 million taxpayers this year -- and 20.5 million in 2007 -- will be slapped with the AMT, according to the Treasury Dept. They'll face a heftier bill from Uncle Sam, and extra paperwork, too.

Efforts are afoot to repeal the unpopular levy. The House of Representatives and the Senate are hashing out legislation that would spare taxpayers from the AMT. In late 2005, the President's Advisory Panel on Federal Tax Reform recommended changes that would include the AMT's demise. But it's unclear whether lawmakers will find room in the budget to slash another revenue source.

WHO BENEFITS MOST.  So with the AMT still alive and kicking, mutual funds are increasingly targeting investors who dread the tax. Typical tax-free bond funds aren't really tax-free when it comes to the AMT. But funds such as the Fidelity AMT Tax-Free Money Fund (FIMXX ) or the Putnam AMT-Free Insured Municipal Fund (PPNAX ) invest only in securities that aren't subject to the tax.

"This is an area where people can look for current income, especially when they're in the upper tax brackets," says Tom Roseen, a senior analyst with New York-based fund tracker Lipper.

AMT-free funds are ideal for investors who already know they have a need for municipal securities, according to Eric Jacobson, a senior fund analyst with Chicago-based fund tracker Morningstar. Folks typically pour their money into munis because their tax efficiency can mean higher returns, depending on individual circumstances. Investors can use a number of online tools to determine whether municipals are right for them. Then, they should check with tax planners about their AMT risk. "If you think you might be subject to AMT and you want a muni fund, it's fine to err on the side of caution and buy the AMT-free fund," Jacobson says.

NOT EASY TO TRACK.  Not all AMT-free funds are alike. They can come from any category of municipal money-market or bond fund, including short, intermediate, and high-yield. "It's good because it gives investors choice, but it makes it more difficult to track the funds," says Brian Boswell, a research analyst for Financial Research, a Boston-based firm. On the plus side, he says the funds' performance is competitive with their AMT-bearing peers.

Fidelity Investments recently introduced its eighth AMT-free fund, the most of any fund company. In 2004, the Boston-based fund complex changed the goals of its five municipal money-market funds to include avoiding the contentious tax. In 2005, Fidelity updated the funds' names to reflect their new AMT-free strategy and lowered the investment minimums on them from $100,000 to $25,000. Expense ratios range between 0.33% and 0.40%, relatively low for muni funds.

Fidelity also offers an AMT-free bond fund, Fidelity Tax-Free Bond Fund (FTABX). It has posted returns that beat its peer-group average each full year since its inception in 2001 and charges a 0.25% expense ratio that's well below average.

DIGGING DEEP.  At American Funds, the Tax-Exempt Bond Fund of America (AFTEX) has been AMT-free since it was introduced in 1979. The fund charges a 3.75% initial sales load and carries a relatively low 0.57% expense ratio. It has beaten its category average over a three- and five-year period, according to Morningstar.

Dexter Williams, manager of the Los Angeles-based fund company's fixed-income department, attributes the fund's record to superior research capabilities. "Most people don't think of research on the municipal side, but we find it to be very important," he says.

Launched in 1978, Eaton Vance Municipal Bond Fund (ETMBX) is another long-running AMT-free fund. The portfolio has a 4.75% sales load and has a slightly below-average expense ratio of 0.91%. Meanwhile, its performance has handily beaten its benchmark Lehman Brothers municipal bond index every year since 2000.

TAKE THE LONG VIEW.  "For the right individual, a non-AMT fund is an absolutely fabulous idea," says Tom Metzold, portfolio manager for Eaton Vance National Municipals (EANAX ). "But one has to do the calculations to determine whether they would better off with a fund that does have some AMT exposure."

Oppenheimer Funds offers a pair of AMT-free funds that seek higher yield than their competitors, but may entail more risk by investing up to 25% of assets in junk bonds. Oppenheimer AMT-Free Municipals (OPTAX ) has expenses of 0.92% and the Oppenheimer AMT-Free New York Municipal (OPNYX ) expenses of 0.93%, while both charge a 4.75% front-end sales load. Over a five-year period, the national fund ranks in the top 2%, and the New York fund in the top 4% of their respective Lipper peer groups.

"People should consider them as long-term holdings," says the funds' manager, Ron Fielding, a senior vice-president with the New York-based company. "When you get out and look at a bond fund's performance over 10 years, most of its total return will come from its yield."

AMONG THE UNLABELED.  Some funds may try to avoid the pesky tax even if they're not specifically AMT-free. Take the $3.9 million Dreyfus Tax Managed Balanced Fund (DLMBX ), launched last fall. The fund combines Dreyfus' municipal-bond management with stock picks from institutional equity manager Fayez Sarofim & Co. It has expenses of 1.15%.

"While [the fund's] prospectus [says] we can buy bonds subject to the AMT, we endeavor that we will not do that," says Paul Disdier, director of municipal securities with the New York-based group. Dreyfus hasn't put AMT-free language in the fund prospectus, he says, for fear of boxing itself in should the tax be overturned by Congress.

Similarly, Putnam Investments shies away from AMT-laden securities across its entire tax-exempt lineup. The Boston-based fund company also offers Putnam AMT-Free Insured Municipal Fund (PPNAX ), which avoids the tax completely. This fund has a 0.84% expense ratio and a front-end sales load of 3.75%, though its performance has trailed its category average for the past three years, according to Morningstar.

AN AMT-FREE FUTURE?  Even investors who aren't currently hit with the AMT should take a long-term approach to the issue, because next year they might be, according to David Hamlin, team leader of Putnam's tax-exempt fixed-income team. That's particularly true for investors in high-tax states or those who have dual incomes. "If you've chosen a fund purely on yield and not lifted the hood and dug around in the engine, you might be buying yield that's coming a lot from the AMT," Hamlin says.

The AMT-wary can only watch and wait as legislative efforts to kill the tax grind along. But in the meantime, some investors might find these fund alternatives a little less taxing. As Morningstar's Jacobson says, "I don't think anyone is likely to be hurt by buying an AMT-free fund, even if the AMT ceases to become a worry."

The Strokes - First Impressions of Earth

Album Review
Paste
December 2005/January 2006
Link













Reviews, Issue 19, Published online on 11 Jan 2006

Different Strokes: Gritty New York quintet does its best to branch out on third LP
 
A half decade after luring rock critics back to the garage, The Strokes cast their heavy-lidded eyes on the arena. First Impressions of Earth sees the formerly concise New York quintet stretching out with frilly guitar solos, because-we-can time-signature shifts and a new producer, David Kahne, who has a proven track record getting bands like Sugar Ray and Sublime played on pop radio. (First item on Kahne’s agenda: scrub Julian Casablancas’ vocals of their signature distortion.) Where 2003’s excellent Room on Fire found the band in a holding pattern after stellar debut Is This It, The Strokes’ latest attempts a bold new statement.

To be sure, First Impressions of Earth holds some surprises for listeners expecting yet another set of streamlined downtown rock. First single “Juicebox” is the band’s heaviest yet, setting hoarse screams over an ominous, detective-show guitar riff previously lit in Weezer’s “Hash Pipe.” The rock turns harder and darker on “Heart in a Cage,” on which guitarist Nick Valensi races through scales like a prog-metal hero. “We gotta live, live, live, live, live,” Casablancas sings. Conversely, the loungey “Evening Sun” sounds like The Strokes abandoning their Lower East Side dives for merlot and smoking jackets someplace uptown. “Fifteen Minutes” leans slurringly toward The Pogues’ pub rock, complete with traces of brogue. “Vision of Divison” starts with the bombast of an ’80s monster ballad—“All that I do is wait for you”—before diverting into a Middle Eastern-tinged jam. Clearly, The Strokes aren’t confining themselves to three-minutes-and-out anymore.

Despite these new splashes of color, The Strokes paint from their usual palette, too. It helps that prior producer Gordon Raphael helms three tracks. Uptempo songs like “You Only Live Once” and “Electricityscape” still feature the ringing-guitar style The Strokes share with New York bands like The Walkmen and the French Kicks. “On the Other Side” is anchored by a disco beat straight off a Casio pre-set as Casablancas muses, perhaps half-heartedly, “I’m tired of being so judgmental of everyone.” The album’s best song, “Razor Blade,” uses more shimmering guitar work but builds into a chorus so affecting it’s hard to mind that it’s nicked from Barry Manilow’s “Mandy,” of all things.

Trouble is, by the time they’re through brandishing quotations, The Strokes don’t have much of their own to say here. They even admit it. “I’ve got nothing to say,” Casablancas confides over Mellotron-like accompaniment on the album’s biggest departure, “Ask Me Anything,” which sounds like the pop-in-a-box of early Magnetic Fields, right down to Stephin Merrit’s flat vocals. Awash in once-uncharacteristic reverb, “Fear of Sleep” slowly repeats its title enough times to actually warrant it. Meanwhile, if “Juicebox” is The Strokes’ “Hash Pipe,” “The Ize of the World” is their “Island In The Sun,” but its pacific guitars give way to crescendo-ing choruses that mindlessly rhyme words ending in “-ize” until cutting off mid-word on “vaporize.” On jaunty closer “Red Light,” Casablancas complains about “a generation that has nothing to say.” He can speak for himself, but it seems any bold new statements will have to wait.

News Analysis
BusinessWeek.com
June 1, 2006
Link

A Miserable May for Markets

Interest-rate uncertainty and a flight from risky assets have investors saying "Mayday." And the roller-coaster ride may not be over

Investors heeding the old dictum "sell in May, then go away" might be wishing they had hightailed it a little earlier this year (see BW Online, 4/26/06, "A Savvy Seasonal Stock Strategy"). For the month, the Dow Jones industrial average fell 1.8%, the broader Standard & Poor's 500-stock index dropped 3.1%, and the tech-heavy Nasdaq composite index slid 6.2%.

What's behind the markets' malaise? Uncertainty about the Federal Reserve's course on interest rates, increased risk aversion, and debates about inflation and slower economic growth contributed to the downturn, market pros say. The bad news is, stocks' recent topsy-turvey ride may not be over yet.

It may seem like ancient history, but the markets actually started the month poised for record gains. On May 10, the Dow hit a six-year closing high of 11,642.65, just 80.33 points from its all-time peak. Companies in the Standard & Poor's index were enjoying their 16th consecutive quarter of double-digit percentage earnings growth, while surging commodities prices drove metal companies such as Alcoa (AA ) and Phelps Dodge (PD ) to 52-week highs. Since then, the Dow has dropped 4.7%, and other indexes have been hit even harder.

RUNNING FROM RISK.  The turning point came with the Fed's last interest-rate hike, analysts say. On May 10, the Fed raised the key federal funds rate to 5%, as expected, but it also left the door open for further tightening (see BW Online, 5/11/06, "Interest Rates: Look, Ma, No Pause!"). "The markets anticipated seeing the red light at 5%," says Art Hogan, chief market analyst at Jefferies & Co. "Everything has been perceived as a negative for the markets after we didn't get that clear message."

At the same time, investors have been fleeing riskier asset classes that had roared ahead, such as emerging markets, commodities, and small-cap stocks. The S&P/IFCI Composite index, which tracks emerging markets, tumbled 9.4% for the month through May 30. The Reuters-Jefferies CRB Futures Price Index fell 2.1% over the same period, despite climbing 2.9% through May 11. The Russell 2000 index, a benchmark for U.S. small companies, was down 7.1%.

In the midst of this shift, the market is left searching for leadership, others say. As energy, metals, and mining names lose luster, large-cap names and companies with strong balance sheets could come out in front, according to Tobias Levkovich, chief U.S. equity strategist at Citigroup. "We think that large-cap and large cash wins," he wrote in a May 30 dispatch, noting that small and mid-cap stocks have led the way for nearly 80 months. Indeed, many market watchers have been predicting that large-caps would stage a comeback this year (See BW, 12/26/05, "The Bulls: Pawing and Snorting").

TOO CLOSE FOR COMFORT?  Since the last Fed meeting, reports showing stronger than expected inflation have spooked investors. On May 17, the Labor Dept. reported that the core consumer price index, which excludes energy and food prices, rose 0.3%, slightly ahead of expectations (see BW Online, 5/17/06, "Stocks Tumble on Inflation Worries").

The report raised the odds the Fed will have to hike rates again in June, Lehman Brothers economist Drew Matus said at the time. On May 26, the Commerce Dept. said the core personal consumption index (PCE) deflator, also excluding energy and food, rose 2.1% in April from a year earlier. It was biggest year-over-year increase in 13 months for the Fed's preferred inflation gauge. Chicago Fed President Michael Moskow said on May 30 that the data indicate an inflation level at the "upper end" of his comfort zone.

A weakening dollar has also loomed. Nevertheless, some analysts say dollar pessimism has been overblown (see BW Online, 6/1/06, "Dodging the Dollar's Decline"). "We think dire warnings of an imminent collapse of the greenback are off base," notes Jay Bryson, global economist at Wachovia. Nor is dollar policy likely to change after the appointment of Goldman Sachs Chairman and CEO Henry Paulson to succeed Treasury Secretary John Snow, according to Bryson (see BW Online, 5/30/06, "Paulson to the Rescue?").

POINT BY POINT.  On the bright side, the housing market hasn't crashed, as some experts feared. Instead, the data have pointed to a gradual slowdown. The National Association of Realtors recently said domestic existing home sales slipped 2%, to a 6.8 million pace in April, from 6.9 million in March. On May 18, former Fed Chief Alan Greenspan said "the boom is over" for housing, in his first public U.S. speech since retiring.

Considering the conflicting signals, the Fed remains uncertain about whether to pursue a 17th consecutive rate increase, judging from the minutes from its May 10 meeting. Options on the table ranged from a 50 basis-point increase to a pause, the minutes show. After the May 31 release of the Fed minutes, futures markets indicated a 74% chance that policymakers will raise rates to 5.25% when the Fed meets June 28-29. That's up from 58% odds a day earlier.

An employment report June 2 could give investors an idea of what to expect. May nonfarm payrolls are projected to rise a modest 163,000, says economic researcher Action Economics. However, nearly a full month of economic data lies ahead for investors before the Fed's meeting. "Every data point has much more meaning again," says Joseph Battipaglia, executive vice-president and chief investment officer for Ryan, Beck & Co.

NEWBIE BLUES.  Some of the stock market's recent downtrend may just be typical for a mid-term election year, says Jeff Kleintop, chief investment strategist for PNC Advisors. "The market usually runs up in the first quarter, peaks in the second quarter, then tends to fall," Kleintop says. "We're following that classic pattern." He adds that government projections of another busy hurricane season could also hang over the market through the summer. Then, he predicts "a classic fourth-quarter rally."

For the time being, investors should keep their seat belts buckled. Stocks historically have higher volatility and lower returns in the first year under a new Fed chairman, according to Mary Ann Bartels, chief U.S. market analyst at Merrill Lynch. Says Bartels in a May 30 report: "Markets are likely to remain volatile until the Fed gives the markets more clarity."

Death Cab for Cutie - Plans

Album Review
Playboy.com
August 25, 2005
(no link)

three bunnyheads out of four

In cooler-than-thou indie-rock circles, Death Cab for Cutie was always sort of, well, square. Singer Ben Gibbard wore his well-crafted pop hooks, like his heart, on his sleeve. So it actually makes sense that these nerdy-looking guys with a goofy name would break out of the rock-snob scene and hit the big time. On major-label debut Plans, the veteran Bellingham, Wash.-based quartet fully unleashes its inner soft-rocker, and neither radio-ready sheen nor too many slow songs can dim Gibbard's sparkling melodies and emotive lyrics. Love is still the 29-year-old songwriter's main subject, but now it's weighed down by mortality. First single "Soul Meets Body" contemplates "the darkness" amid ba-ba choruses and guitarist Chris Walla's ornate production. Sparse acoustic ballad "I Will Follow You Into the Dark" and Walla-penned "Brothers on a Hotel Bed" are equally haunted, the latter relying on the band's new favorite instrument, piano. But Plans sees too much hope in the human condition to get depressing. Expansive opener "Marching Bands of Manhattan" imagines moving an island for love, while "Someday You Will Be Loved" lets a would-be Mrs. Gibbard down surprisingly easy. Even when Gibbard sings that "love is watching someone die," on emergency-room portrait "What Sarah Said", a quiet awe still seeps through. Sneer if you must, but Death Cab's legacy is still being born.

The Arcade Fire's Joyful Funeral

Feature
UR Chicago
November 2004
(no link)

The debut album by Canada's latest indie-rock export makes clamorous noise and mournful lyrics uplifting. Lead singer Win Butler explains how.

A few days after playing sold-out shows at the CMJ Music Festival and earning rapturous praise in the New York Times, Win Butler is talking about dogs.

Butler is the lead singer for a Montreal band called The Arcade Fire, whose debut album, Funeral, is a madcap, orchestral indie-rock epic that fuses Neil Young, Talking Heads and the Pixies. The album's centerpiece is a suite of four songs about a concrete yet universal "neighborhoods," ranging from the fractured escapism of "Neighborhoods #1 (Tunnels)" to "Neighborhoods #4 (7 Kettles)", a blistering emo ballad that would make Bright Eyes weep (maybe more than usual).

It's angular, accordion-accented "Neighborhoods #2 (Laika)" that has the soft-spoken Butler's thoughts turning toward man's best friend.

"Laika's the Russian space dog," he explains, "the first living thing in space. They launched this dog up in space, it had enough food for two days and they knew it was going to die. There's the image of this animal being the first thing to see Earth from space -- to see this amazing, unbelievable thing -- but also knowing that they're going to die, or everyone else knowing it, anyway."

As a child, one of Butler's favorite movies was 1985's My Life as a Dog, directed by Lasse Hallström. This bittersweet film tells the story of a boy whose mother is dying of cancer.

"The character keeps saying that 'whenever stuff gets really bad, I think about Laika,'" Butler recalls. "He's just up there going around the Earth."

The central contradiction of Laika's existence suffuses Funeral. As the album's title suggests, the Arcade Fire's members saw their share of death in the time leading up to Funeral's recording. Multi-instrumentalist Régine Chassagne, the other half of the band's songwriting team, dealt with the death of her grandmother in June 2003. Butler's grandfather died in March 2004. Richard Parry's aunt died a month later.

As a result, conscious or not, the album is dark with the frayed emotions of people who have lost their loved ones. "The streetlights all burnt out," Butler sings, his voice fragile and stark, in "Une Annee Sans Lumiere" ("A Year Without Light").

Yet in the midst of so much sadness, Funeral resonates with the joy of living, with the magic of being the first to experience something amazing, even if life is ultimately temporary. After Butler delivers a lyric about the grim reaper in "Wake Up", his accompaniment takes on a Motown-like bounce. Sounding perversely uplifting, Butler shouts, "Look out below!"

"It wasn't really a record that was explicitly trying to deal with anything," Butler says. "It was just something that leaked through, I guess. I don't know if it's that explicitly uplifting if you look at the lyrics on the page. That's what we feel, so that comes through, even if it's not explicit."

Amid the past year's funerals, the Arcade Fire also saw a wedding. Butler and Chassagne were married in August 2003. They first started playing together after Butler saw Chassagne singing jazz at an art exhibit at Concordia University.

"Everyone was just totally caught up watching her sing," he recalls. "I'm just -- I knew I had to play music with her."

As Butler describes it, their musical relationship was like a compulsion, not something optional.

"It was just kind of a sense that we had to do it," he explains. "There was almost like a real dire kind of feeling to it, 'Yes, we have to play.' It wasn't like, 'I want to play it.' I still feel that way."

The Arcade Fire have played in Chicago once before, for a show with fellow Canadians the Unicorns at Open End Gallery in June.

The band's upcoming shows at Logan Square Auditorium and the Empty Bottle will feature the return of Butler's younger brother, multi-instrumentalist Will. A student at Northwestern University, Will Butler appears on the album and played at CMJ, but his classes prevent him from playing on most of the band's dates.

"We're super-excited," exclaims the elder Butler.

On stage, the band likes to stray a bit from the record, Butler says.

"I don't know that we could ever go into the studio and just capture what we do live," he observes. "It's a lot more draining and a lot more intense physically live, and it could really only exist the way it does in a live setting."

Butler says the band is made up of a bunch of instinctual performers.

"When we feel the instinct to do something, we just kind of follow it to its logical extreme," he explains.

All right, but what's up with the band's name? Butler says urban legend held that there was once a fire at the arcade he played in growing up. Funeral may hold as many layers of meaning as it does orchestration, but some questions have simple answers.

THE ARCADE FIRE PLAYS LOGAN SQUARE AUDITORIUM (2539 NORTH KEDZIE, 773/276-3600)  NOV.  25 AND THE EMPTY BOTTLE (1035 N. WESTERN, 773/276-3600) NOV. 26. FUNERAL IS OUT NOW.

Songwriter of the South

Feature
UR Chicago
June 2004
(no link)

Iron & Wine's whispery frontman, Sam Beam, raises his voice to discuss his latest collection of Faulknerian sound -- hold the fury.

Two years ago Sam Beam was a film teacher who fooled around with a four-track tape machine in his free time. Now the sepia-toned singer/songwriter with a beard straight from Civil War photographs is back for another national tour in support of his second album on the label that brought you Nirvana.

Under the moniker Iron & Wine, Beam records gentle, anachronistic folk songs fit for a Deep South Nick Drake. Sumptuous harmonies dress up highly descriptive lyrics worthy of a man who until this year still taught cinematography at Miami International University of Art & Design.

"Cinder and smoke, some whispers around the trees / The juniper bends, as if you were listening," he half-sings, half-whispers in a particularly vivid example from his latest SubPop release, Our Endless Numbered Days. (The song, "Cinder and Smoke," is an "Adam and Eve kind of thing," Beam explains.)

"It's pretty intuitive, honestly," the happily married father of two says of his songwriting style. "A lot of people are just describing their feelings -- how many adjectives can you put on the word love? I try to push it a little bit differently."

While SubPop assembled The Creek Drank the Cradle from the original four-track demos, Beam sat down in a studio for his latest outing. With its evocative storytelling and quiet power,  Beam has proven himself to be a rare breed -- the lo-fi singer/songwriter who improves still further once he gets out of the bedroom and into the studio. While indie icons such as Lou Barlow and Liz Phair left much of their best work on hiss-laden cassettes, Beam has broadened his palette as gracefully as another melancholy troubadour, the late Elliott Smith.

Though the banjos and hushed vocals of the debut remain, augmented by backing vocals by Beam's sister, Sara, his lyrics are more character-driven, less confessional than that disc's first-person emotion.

"Even the ones that sound autobiographical weren't really autobiographical," Beam protests. "They're just stories. There definitely are autobiographical parts, but I think the sense that they're these sort of bedroom recordings really lends itself to making people think that it's more confessional than it is."

Thematically, Our Endless Numbered Days is a more mature take on Beam's Faulkner-esque depictions of Southern living and old-time religion.

"The first one has more of a rite-of-passage feel to the record," he muses. "This one is just more of a recollection, a pondering kind of feel. A rumination on mortality, on family, on life."

Lyrically and musically, Beam's songs are soaked in Bible Belt mystique, from his debut's "Southern Anthem" to the new "Sodom, South Georgia." Though he lives in Miami, Beam grew up in Columbia, S.C., to which he attributes his visible roots.

"It's a lot easier to comment on now that I don't live there," he says, pointing out that much of the Southern atmosphere comes from the banjos and slide guitars that twang throughout his music. "But a lot of the themes I talk about are pretty common to the entire country."

Beam basically stumbled into the music industry. A friend promoting another band played some Iron & Wine for the folks at SubPop, and the rest is indie history. With such a serendipitous path to success, Beam makes a point of trying to think of his music career more as a "hobby."

"I try to keep a certain perspective in my head," he notes. "If you take it too seriously, you end up writing road songs."

It sounds like Iron & Wine won't be covering Bob Seger's "Turn the Page" anytime soon. But Our Endless Numbered Days itself was recorded far from home -- in Wicker Park, as a matter of fact. The idea of the muggy, distinctively Southern sounds of Beam's music emanating from a frigid Chicago winter is tantalizingly ironic, but Beam and producer Brian Deck actually set the songs to disc last July.

"We went to the art museum and went down to the lake," Beam recalls of his Chicago experience. "Honestly, we were pretty busy."

Growing up, Beam wasn't always about songs that could have been culled from old Time/Life field recordings.

"When I really started to identify with music it was more like skate-punk stuff," he says. "Then in high school, Velvet Underground, Pink Floyd..."

It's not too far-fetched to imagine Beam as a young man listening to rock 'n' roll on the radio, rather than the faded myths of his own music. But what about his most distinctive feature -- that Robert E. Lee beard?

Beam chuckles. "I've had it for quite a while," he says. "It's out of pure laziness. A lot of men who have beards just don't like to shave."

What of men who don't like to shave, but whose girlfriends won't let them grow such in such facial topiaries?

Beam doesn't miss a beat: "Maybe you should reassess who you're dating!"

IRON & WINE PLAYS ABBEY PUB (3420 W. GRACE ST., 773/478-4408) JULY 2 WITH LANG TRY.

Death Cab Goes the Distance

Feature
UR Chicago
October 9-November 12, 2003
(no link)


On its fifth album, Transatlanticism, Death Cab for Cutie moves past the trappings of indie rock.

Somehow it would seem inappropriate to interview Ben Gibbard in person. After all, the Death Cab for Cutie singer/songwriter collaborated on an entire side project through the mail-- the Postal Service's electro-pop full-length Give Up. Some of his finest songs, such as "A Movie Script Ending" from 2001's Death Cab release The Photo Album, render long-distance relationships in heartbreaking detail.

So when the Washington state-based musician's voice crackles over a speaker-phone from his home 2,000 miles away, nothing could seem more apropos, especially given the content of Death Cab's fifth album, Transatlanticism. Out October 7 on Barsuk Records, the release picks up thematically exactly where "A Movie Script Ending" left off: "on the highway," far from friends and loved ones.

"Coming off all the touring and promotional stuff for the last album, I came to the realization that your relationships, personal or romantic or whatever, really suffer when you are gone all the time," Gibbard explains.

Produced by Death Cab guitarist/keyboardist Chris Walla, Transatlanticism marks a progression in the band's sound, as the quartet toys with expansive arrangements to convey the songs' subjects in form as well as lyrics. Much as Chicago band Wilco's 2002 album Yankee Hotel Foxtrot deconstructed alt-country, Transatlanticism sees some of indie rock's standard-bearers breaking down the conventions to confect a shimmering, spacious and remarkably accessible record.

"I don't want to be an indie rock band," Gibbard says. "I want to have songs, with beginnings and endings. We're over a lot of the stereotypical trappings of indie rock."

BETWEEN MISERY AND HAPPINESS

Transatlanticism's title comes from a word Gibbard thought he coined, referring to distances "such as a body of water creates between two people," a concept that informs nearly every song.

Gibbard's lyrics remain as highly dense and grammatically correct as on previous collections, and no less earnest. "I wish the world was flat like the old days / Then I could travel just by folding a map," he sings on the first single, "The New Year." But the album includes more pop influences than the rest of the Death Cab catalogue, from the "Bah bah" chorus of "the Sound of Settling" to the melismatic "so-o-o-o sad" on "The Death of an Interior Decorator," which feels like a composition by indie-pop singer/songwriter Elliott Smith. The overall effect is intentionally bittersweet.

"My outlook on life is somewhat cynical, but always trying to find the little slices of beauty and truth that only exist for short periods of time and fall away," Gibbard says. "It's somewhere between misery and happiness. I have a hard time going all the way one way or the other."

Some lyrics are oblique, such as the "ivory lines lead oh-wa-ho" chorus of "Lightness"; Gibbard explains that, in context of "a tear in the fabric" from an earlier verse, the are lines of ivory skin leading to "a naughty place."

Unlike previous albums, the band performed very few of the disc's 11 songs on tour. As a result, Transatlanticism sounds more intricately textured and less like just a studio recording of a live band.

"When you play the songs on stage, the easiest thing to do practically is just to have two guitars, bass and drums," Walla says. "But when you're not tied to particular textures or having a particular voice play a part, it's much easier in the studio to go, 'I don't think that's a guitar line. I think you should be playing that on piano or glockenspiel or whatever's around.'"

Caught up in a spirit of experimentation, Gibbard, Walla, bassist Nick Harmer and new drummer Jason McGerr built up layer after layer of sound around Gibbard's words and melodies. A grinding drone that Walla stumbled upon by accident carries on throughout "Lightness." One track later, a xylophone-like device designed to educate children about pitch provides the instrumental interlude for "Title and Registration." Wurlitzer electric keyboards and pianos flourish throughout the disc, leading to an almost-Ben Folds effect on the slow, graceful "Passenger Seat."

Though Gibbard's other 2003 project, the Postal Service, filled its music with tweaks and blips, that aesthetic didn't bleed over to the Death Cab record, according to Walla.

"I won't speak for Ben, but I think he wanted to be in a rock band again," Walla says.

MOVING PAST THE NOISE


Both Gibbard and Walla express only confidence about this album's poppy, song-focused nature.

"The bands that I admired always evolved and moved past the noise," says Gibbard, whose favorite record by indie-rock icons Pavement is their polished, Nigel Godrich-produced Terror Twilight-- not such disjoined earlier work as Slanted and Enchanted.

"I don't feel there's any reason for us not to try and reach as many people as we can," Walla says. "This is our fifth record, and of the people who have been with us since day one, there are going to be some who love this record. There will be some people who hate it. And then there are going to be a bunch of kids who, this will be their first Death Cab record and this will always be their first Death Cab record."

For Gibbard's part, as long as he can look out in the audience and see someone who reminds him of a younger self, who makes him think, "I would come to my shows," he's more than pleased.

"If we started doing shows and only 14-year-olds were coming, I'd feel a bit strange about that," he admits. "I like the crowd that I see when I look out from the stage, and to me, that's what it comes down to."

For the band's current tour, hitting Metro October 10 and 11, expect a sampler and lots of instrument-switching on stage. The ambient noises that float around on Transatlanticism will provide continuity to the live show, as well.

And the girl whose distance inspired all of the heartache of Transatlaticism She now lives with Gibbard in Seattle. "That's the happy ending to the otherwise-sad record," he says.

Transatlanticism (Barsuk Records) is out now; Death Cab for Cutie plays the Metro October 10 and 11