Been on a posting hiatus, but the subtle absurdity of this story brought me out of my bear hibernation. I only took the part of the story that I found the most ridiculous to highlight so as not to burden you with too much reading:
Expanded Hours, Discounts Lure ShoppersSaturday November 25, 5:32 am ET By Anne D'Innocenzio, AP Business Writer
Nation's Retailers Hope Early Start, Generous Discounts Lure Eager Holiday Shoppers
".....In fact, many of those who arrived at stores early Friday came away disappointed. They were plenty of customers like Brian Clark, 27, who left empty-handed from the West Hartford Best Buy after the televisions and computers he'd eyed as Christmas gifts were snatched by even earlier shoppers.
Alarmed by a recent shooting of a customer waiting outside a Connecticut Wal-Mart for the highly sought Sony's PlayStation 3 game console, Clark had tucked his Glock pistol in a holster under his jacket and put extra ammunition in his pocket before heading out early Friday. ...."
-sigh-
'nuff said, i reckon.
ciao,
fB
Saturday, November 25, 2006
Sunday, November 12, 2006
More on RealEstate, Gold, and the Dollar
I decided to post this older post, originally written about a month ago, after I learned that at least two people had seen my blog....effectively tripling my viewship (including myself)! :) So, here I go making sweeping statements, that will be sure to turn off enough of my "audience" so that our numbers can return to the low single digits.
This post is effectively "part II" to an earlier post that noticed the "funny coincidence" that my bay area home, purchased in June of 2002 and sold in June of 2004 increased in value by 29%....almost *exactly* the amount of money that gold increased during the same time frame.
The inference was that excessive money (and credit) creation, was stealthily inflating the US dollar into oblivian.
In this post I will revisit what happened to my house since 2004. I'd also like to "debunk" the argument that investing in real-estate (in the last two years) was an effective way to avoid dollar devaluation in an inflationary environment.
Zillow.com says that my home has appreciated ANOTHER 29% since I sold. OUCH! --- left a lot of money on the table...or did I?
Gold prices have increased 65% during that same time frame.
So what is happening?
RE is not a great store of value because it isn't fungible and it has a purpose other than money or a store of value.
huh? what the h3ll does that mean?
Fungible, as I'm using it here, means nearly infinitely divisible, without losing it's per unit value. In other words, a gold bar could be cut in half and be worth 1/2 the value of the whole bar. Try that with a house.
Think of the prospector paying for a whiskey with a pinch of gold dust. Oil is another good example fungibility. Imagine trying to pay for a whiskey with a piece of sheetrock.
The intelligence that goes into organizing the parts of the house, means that the value of the whole is greater than the sum of its parts.
ok, so what? why is that important?
The absurdly inflated prices had already gone up so far past anyone's ability to pay (even using the most ridiculously dangerous loan products and non-existent loan standards) that they couldn't possibly keep pace with the speed of the "real" inflation in cash and credit.
Once people couldn't afford to speculate in single family residences in the most desirable areas using traditional financing, they were forced to keep the party going using more drastic tactics:
"suicide" loan products (excessive levering)? check.
Pool into partnerships for speculating? check.
Speculate in traditionally less desireable areas? check.
Speculate in condos? check.
Fraud? CHECK!!!! (more on this in a later post -- this has been the single biggest contributor to keeping the decline shallow to this point, in my opinion).
That unfortunately means if you are using houses to guard against easy money inflating the value of your portfolio away, you have a problem.
As we've discussed here before, the obvious outcome is first slowing sales, slightly dipping medians (as builders run out of incentives to add to the purchase price), inflating inventories, and "stuck" sellers. At this point, the mainstream media is so "all over" this story that it is probably getting a bit old -- especially if you are trying to sell and can't.
The story that is still being completely missed is that in "real" terms (inflation adjusted dollars) housing has already been tanking for the last couple of years. This will continue, and unless the fed increases the pace of credit expansion, the nominal (non-inflation adjusted prices) will continue to go down, creating problems for levered buyers of all classes.
As Soros has pointed out, housing is one of the most "reflexive" assets around (more on reflexivity in a later post) and the reason they run so hard and fast and long on the way up and the way down.
Ok, so your unsolicited advice of the day is to wait for (probably years) before buying any more residential RE. It will take a long time to correct down, and will only be a reasonable buy with PITI is near or below a breakeven proposition with renting a similar property, IMO.
ciao,
fB
This post is effectively "part II" to an earlier post that noticed the "funny coincidence" that my bay area home, purchased in June of 2002 and sold in June of 2004 increased in value by 29%....almost *exactly* the amount of money that gold increased during the same time frame.
The inference was that excessive money (and credit) creation, was stealthily inflating the US dollar into oblivian.
In this post I will revisit what happened to my house since 2004. I'd also like to "debunk" the argument that investing in real-estate (in the last two years) was an effective way to avoid dollar devaluation in an inflationary environment.
Zillow.com says that my home has appreciated ANOTHER 29% since I sold. OUCH! --- left a lot of money on the table...or did I?
Gold prices have increased 65% during that same time frame.
So what is happening?
RE is not a great store of value because it isn't fungible and it has a purpose other than money or a store of value.
huh? what the h3ll does that mean?
Fungible, as I'm using it here, means nearly infinitely divisible, without losing it's per unit value. In other words, a gold bar could be cut in half and be worth 1/2 the value of the whole bar. Try that with a house.
Think of the prospector paying for a whiskey with a pinch of gold dust. Oil is another good example fungibility. Imagine trying to pay for a whiskey with a piece of sheetrock.
The intelligence that goes into organizing the parts of the house, means that the value of the whole is greater than the sum of its parts.
ok, so what? why is that important?
The absurdly inflated prices had already gone up so far past anyone's ability to pay (even using the most ridiculously dangerous loan products and non-existent loan standards) that they couldn't possibly keep pace with the speed of the "real" inflation in cash and credit.
Once people couldn't afford to speculate in single family residences in the most desirable areas using traditional financing, they were forced to keep the party going using more drastic tactics:
"suicide" loan products (excessive levering)? check.
Pool into partnerships for speculating? check.
Speculate in traditionally less desireable areas? check.
Speculate in condos? check.
Fraud? CHECK!!!! (more on this in a later post -- this has been the single biggest contributor to keeping the decline shallow to this point, in my opinion).
That unfortunately means if you are using houses to guard against easy money inflating the value of your portfolio away, you have a problem.
As we've discussed here before, the obvious outcome is first slowing sales, slightly dipping medians (as builders run out of incentives to add to the purchase price), inflating inventories, and "stuck" sellers. At this point, the mainstream media is so "all over" this story that it is probably getting a bit old -- especially if you are trying to sell and can't.
The story that is still being completely missed is that in "real" terms (inflation adjusted dollars) housing has already been tanking for the last couple of years. This will continue, and unless the fed increases the pace of credit expansion, the nominal (non-inflation adjusted prices) will continue to go down, creating problems for levered buyers of all classes.
As Soros has pointed out, housing is one of the most "reflexive" assets around (more on reflexivity in a later post) and the reason they run so hard and fast and long on the way up and the way down.
Ok, so your unsolicited advice of the day is to wait for (probably years) before buying any more residential RE. It will take a long time to correct down, and will only be a reasonable buy with PITI is near or below a breakeven proposition with renting a similar property, IMO.
ciao,
fB
Friday, November 10, 2006
"But... I thought the Fed was tightening?...."
From the NYPost
""Whenever we discuss some of the darker theories of a conspiracy or market manipulation, I seek to discover a market mechanism that can explain the actions. For example, I was quite doubtful of accusations of energy price manipulation -- until Bill King identified the changes in the Goldman Sachs Commodities Index (GSCI). That change led to $6 billion of gasoline futures hitting markets in September and October -- and the subsequent 30% drop in gas prices over a few weeks. (fubarrio note: this 'atomic' drop in gasonline was the ignition for many twinkie induced rages this fall -- luckily the naive Montevideans had not heard the junk-food defense yet, and it's novelty led to two separate "not guilty" verdicts and a hung jury)
Might there be any similar mechanism around impacting equities? One possible answer comes from John Crudele of the NY Post. Crudele has long been a skeptic of government data; its no surprise he looks askance at some of the actions of ther Fed and Treasury. And indeed, it is the Treasury Department that comes under his watchful gaze.
Yesterday, Crudele wrote: "FOR the past few years the U.S. Treasury has been quietly involved in what the financial markets call "repo" agreements and this near-secret operation could explain why the nation's money supply seems to be confoundingly large. It might also explain why Washington decided earlier this year to stop publishing M3 money supply figures, the broadest and most popular measure of money in circulation.
Repurchase agreements - or repos - have long been used by the Federal Reserve to get money quickly into the hands of financial institutions, which in turn can put the money into circulation in the form of loans. Last Thursday, for example, the Fed executed $2.5 billion in overnight repos and $8 billion in 14-day repurchase agreements. These were reported on the financial wires. The Treasury completed a $5.5 billion repo operation on the same day under what it calls the Term Investment Option. There was no mention of the Treasury operation on the wires.
In the Fed's repo deals, the banks temporarily turn over securities to the central bank in exchange for cash. The Treasury TIO program works in a similar way, except the financial institutions pledge securities as collateral in exchange for the cash."
What does this mean? Well, instead of the (theoretically) independent Federal Reserve controlling Money Supply, we see the Treasury department has had an "unseen" hand. MZM, M2 and credit growth has been soaring. This has the effect of providing the fuel for increasing the leverage and risk in the system.
"Is this like the repo operation at the Fed? "Kinda'," says a spokeswoman for Treasury. "But not really." She said the TIO program only replaced the old way of putting government cash in banks without making the banks place bids, which gets the government a better deal." This repo action is not reported by the Treasury Department, and Crudele that "financial institutions have been using it for three years to increase their liquidity." Surprisingly, it is not well known by the investment community.
What's the problem with this? Crudele notes: Experts worry whenever there is too much money - liquidity - in the financial system because it can lead to things like price spirals in the housing market and bubbles in stocks (emphasis added). But even more worrisome for the financial markets than too much liquidity would be an inability to track the amount of money being pumped into the financial system.
Unless I find out differently, it looks as if the Treasury has created a way to duplicate the Fed's power. And that is a disturbing possibility unless it is somehow monitored. Bill King adds: "$20B was added to the system last Thursday and Friday. Where is it going with the economy ebbing? Of course it goes to the ‘new economy’, which is financial speculation and asset grabbling . . . The astute know that the repo world runs The Street. It is the lifeblood of The Street, and ‘The Money Desk’ of each big firm is the heart of the organization. Other traders garner the headlines and TV spots but the ‘money desk’ reigns supreme on The Street. Just ask the ex-principals of LTCM." Indeed. The plot thickens . . .
""Whenever we discuss some of the darker theories of a conspiracy or market manipulation, I seek to discover a market mechanism that can explain the actions. For example, I was quite doubtful of accusations of energy price manipulation -- until Bill King identified the changes in the Goldman Sachs Commodities Index (GSCI). That change led to $6 billion of gasoline futures hitting markets in September and October -- and the subsequent 30% drop in gas prices over a few weeks. (fubarrio note: this 'atomic' drop in gasonline was the ignition for many twinkie induced rages this fall -- luckily the naive Montevideans had not heard the junk-food defense yet, and it's novelty led to two separate "not guilty" verdicts and a hung jury)
Might there be any similar mechanism around impacting equities? One possible answer comes from John Crudele of the NY Post. Crudele has long been a skeptic of government data; its no surprise he looks askance at some of the actions of ther Fed and Treasury. And indeed, it is the Treasury Department that comes under his watchful gaze.
Yesterday, Crudele wrote: "FOR the past few years the U.S. Treasury has been quietly involved in what the financial markets call "repo" agreements and this near-secret operation could explain why the nation's money supply seems to be confoundingly large. It might also explain why Washington decided earlier this year to stop publishing M3 money supply figures, the broadest and most popular measure of money in circulation.
Repurchase agreements - or repos - have long been used by the Federal Reserve to get money quickly into the hands of financial institutions, which in turn can put the money into circulation in the form of loans. Last Thursday, for example, the Fed executed $2.5 billion in overnight repos and $8 billion in 14-day repurchase agreements. These were reported on the financial wires. The Treasury completed a $5.5 billion repo operation on the same day under what it calls the Term Investment Option. There was no mention of the Treasury operation on the wires.
In the Fed's repo deals, the banks temporarily turn over securities to the central bank in exchange for cash. The Treasury TIO program works in a similar way, except the financial institutions pledge securities as collateral in exchange for the cash."
What does this mean? Well, instead of the (theoretically) independent Federal Reserve controlling Money Supply, we see the Treasury department has had an "unseen" hand. MZM, M2 and credit growth has been soaring. This has the effect of providing the fuel for increasing the leverage and risk in the system.
"Is this like the repo operation at the Fed? "Kinda'," says a spokeswoman for Treasury. "But not really." She said the TIO program only replaced the old way of putting government cash in banks without making the banks place bids, which gets the government a better deal." This repo action is not reported by the Treasury Department, and Crudele that "financial institutions have been using it for three years to increase their liquidity." Surprisingly, it is not well known by the investment community.
What's the problem with this? Crudele notes: Experts worry whenever there is too much money - liquidity - in the financial system because it can lead to things like price spirals in the housing market and bubbles in stocks (emphasis added). But even more worrisome for the financial markets than too much liquidity would be an inability to track the amount of money being pumped into the financial system.
Unless I find out differently, it looks as if the Treasury has created a way to duplicate the Fed's power. And that is a disturbing possibility unless it is somehow monitored. Bill King adds: "$20B was added to the system last Thursday and Friday. Where is it going with the economy ebbing? Of course it goes to the ‘new economy’, which is financial speculation and asset grabbling . . . The astute know that the repo world runs The Street. It is the lifeblood of The Street, and ‘The Money Desk’ of each big firm is the heart of the organization. Other traders garner the headlines and TV spots but the ‘money desk’ reigns supreme on The Street. Just ask the ex-principals of LTCM." Indeed. The plot thickens . . .
Thursday, November 09, 2006
Biggest Story You may have Missed
With all the other things going on, I'm not sure this got a lot of play in the US -- especially on the tube.
But, this is a big "story", with the caveat being that if it is genuine it is *beyond me* why the Chinese would telegraph this move so every trader and institutional and otherwise could front run them.
Is it possible that the Chinese are devious enough to plant a story to send people off the real scent? Certainly. And usually, I'd suspect just that....but in this case, I tend to believe what they are saying -- just because I can't understand what kind of insanity would make them do otherwise.
Please pay special attention to the last paragraph and my comment after the story.
The story:
">>Dollar Declines After Reuters Says China May Diversify Reserves By Daniel Kruger and Min Zeng Nov. 9 (Bloomberg) -- The dollar fell to the lowest against the euro in more than two months after Reuters reported People's Bank of China Governor Zhou Xiaochuan said he has a ``clear'' plan to diversify the country's foreign-exchange reserves.
China's foreign-currency reserves have exceeded $1 trillion to become the most ever held by a single country, China Central Television reported on Nov. 7, citing the nation's currency administrator. ``It seems to have pressured the dollar,'' said Michael Malpede, a senior currency analyst in Chicago at Man Global Research. The dollar traded at $1.2837 per euro at 12:37 p.m. in New York from $1.2757 yesterday. The U.S. currency touched $1.2848, the lowest since $1.2875 on Sept. 5. The U.S. currency also traded at 117.91 yen from 117.84. The dollar earlier reached 118.59 yen.
The People's Bank of China is the fourth central bank to announce it may diversify its reserves in the past two months. The People's Bank of China joins the Bank of Russia, the Swiss National Bank and the Reserve Bank of New Zealand in announcing an intention to diversify currency holdings. Gold Rises Gold rose after the announcement by the Chinese central bank's governor. Futures for December delivery increased $15, or 2.4 percent, to $633.30 an ounce on the Comex division of the New York Mercantile Exchange. A close at that price would mark the biggest percentage gain since July 11.
When asked whether China planned to shift its reserves away from Treasury notes and into higher-yielding U.S. corporate and mortgage-backed debt, Zhou said China is considering ``lots of instruments'' for diversification. "
WTF? could you imagine??? How stupid would one have to be? They see a coming collapse in the value of the dollar -- or at least more risk than they are willing to live with "undiversified" -- and to get *AWAY* from the risk, they just buy more dollar denominated crapola only with a few more basis points of return to compensate for their stench?
However bad a risk the US govt is, why why why why why would anyone accept the tiny spread between the US govt paper and some over extended greater fool's mortgage promise in bubblicious USA in the form of MBS (mortgage backed securities).
....even with the Chinese affinity for crappy/new residential construction, even *they* can't want to be holding the bag on that disaster in the making.
Maybe in 3 or 4 years when they can just walk in and buy it all at a severe discount....but move $1T into MBS?? hahahahhahahahaha....ok, i'm better now.
ciao for now,
fB
But, this is a big "story", with the caveat being that if it is genuine it is *beyond me* why the Chinese would telegraph this move so every trader and institutional and otherwise could front run them.
Is it possible that the Chinese are devious enough to plant a story to send people off the real scent? Certainly. And usually, I'd suspect just that....but in this case, I tend to believe what they are saying -- just because I can't understand what kind of insanity would make them do otherwise.
Please pay special attention to the last paragraph and my comment after the story.
The story:
">>Dollar Declines After Reuters Says China May Diversify Reserves By Daniel Kruger and Min Zeng Nov. 9 (Bloomberg) -- The dollar fell to the lowest against the euro in more than two months after Reuters reported People's Bank of China Governor Zhou Xiaochuan said he has a ``clear'' plan to diversify the country's foreign-exchange reserves.
China's foreign-currency reserves have exceeded $1 trillion to become the most ever held by a single country, China Central Television reported on Nov. 7, citing the nation's currency administrator. ``It seems to have pressured the dollar,'' said Michael Malpede, a senior currency analyst in Chicago at Man Global Research. The dollar traded at $1.2837 per euro at 12:37 p.m. in New York from $1.2757 yesterday. The U.S. currency touched $1.2848, the lowest since $1.2875 on Sept. 5. The U.S. currency also traded at 117.91 yen from 117.84. The dollar earlier reached 118.59 yen.
The People's Bank of China is the fourth central bank to announce it may diversify its reserves in the past two months. The People's Bank of China joins the Bank of Russia, the Swiss National Bank and the Reserve Bank of New Zealand in announcing an intention to diversify currency holdings. Gold Rises Gold rose after the announcement by the Chinese central bank's governor. Futures for December delivery increased $15, or 2.4 percent, to $633.30 an ounce on the Comex division of the New York Mercantile Exchange. A close at that price would mark the biggest percentage gain since July 11.
When asked whether China planned to shift its reserves away from Treasury notes and into higher-yielding U.S. corporate and mortgage-backed debt, Zhou said China is considering ``lots of instruments'' for diversification. "
WTF? could you imagine??? How stupid would one have to be? They see a coming collapse in the value of the dollar -- or at least more risk than they are willing to live with "undiversified" -- and to get *AWAY* from the risk, they just buy more dollar denominated crapola only with a few more basis points of return to compensate for their stench?
However bad a risk the US govt is, why why why why why would anyone accept the tiny spread between the US govt paper and some over extended greater fool's mortgage promise in bubblicious USA in the form of MBS (mortgage backed securities).
....even with the Chinese affinity for crappy/new residential construction, even *they* can't want to be holding the bag on that disaster in the making.
Maybe in 3 or 4 years when they can just walk in and buy it all at a severe discount....but move $1T into MBS?? hahahahhahahahaha....ok, i'm better now.
ciao for now,
fB
Wednesday, November 08, 2006
Interesting Coincidence....
I was writing an email to an old friend today and noted that I sold my home in June of 2004 after "owning" for two years (really the bank owned it, but you get my drift).
When I sold, I thought RE was looking "toppy" and booked a 29.09% gain on my sale (not including commissions and transaction costs which obviously lowered the final take considerably)
The price of gold when I bought was 310/oz
The price of gold when I sold was 400/oz
That is a 29.03% gain.
So was the RE bubble created because of a chronic shortage of buildable land in the SF bay area, or something else? Well, given the national, if not global nature of the bubble, you already know my feeling.
The uncanny resemblance between the POG return and my home's return leaves us with the only explanation plausible, in my opinion....The run-up in prices since at least 2002 (probably earlier) was by credit expansion and incredibly loose monetary standards.
While continued inflation is possible, it is illusory.....the price gains are being eroded by a dollar decreasing in value....the only reason it isn't/wasn't more obvious is that anything that can be mfg'ed or serviced overseas was done in a great wage arbitrage leaving everyone wondering why gas was 2.50/gallon and microwaves at walmart were $99.
Home prices haven't gone up. Your dollar has gone down...Oh yeah, and some crappy plastic stuff at Walmart is pretty cheap too.
ciao for now,
fB
When I sold, I thought RE was looking "toppy" and booked a 29.09% gain on my sale (not including commissions and transaction costs which obviously lowered the final take considerably)
The price of gold when I bought was 310/oz
The price of gold when I sold was 400/oz
That is a 29.03% gain.
So was the RE bubble created because of a chronic shortage of buildable land in the SF bay area, or something else? Well, given the national, if not global nature of the bubble, you already know my feeling.
The uncanny resemblance between the POG return and my home's return leaves us with the only explanation plausible, in my opinion....The run-up in prices since at least 2002 (probably earlier) was by credit expansion and incredibly loose monetary standards.
While continued inflation is possible, it is illusory.....the price gains are being eroded by a dollar decreasing in value....the only reason it isn't/wasn't more obvious is that anything that can be mfg'ed or serviced overseas was done in a great wage arbitrage leaving everyone wondering why gas was 2.50/gallon and microwaves at walmart were $99.
Home prices haven't gone up. Your dollar has gone down...Oh yeah, and some crappy plastic stuff at Walmart is pretty cheap too.
ciao for now,
fB
Sunday, November 05, 2006
History "Rhymes"
I was doing some thinking the last couple of days about markets and cycles in general.
Although I didn't go back past the 1920's, their seems to be an interesting cyclicality in the financial markets evolving....While I can't be certain, I imagine that the birth/work/death cycle of the average human has a lot to do with it. I'm sure others have noticed and pontificated on the causes, but this is newer to me.
Lets talk about the great "busts" in US history
1929-1943(ish)
This is the most famous...The Great Depression. Even though outside forces (apparently) conspired to bring the US out of the GD, notice that is was "about" 14 years
1968-1982
Although most people realize that the market did not perform well during this period, most would think it anywhere near as severe as the GD. That is because the GD was *deflationary* and the 68-82 crash was *inflationary*.
The result was that the GD looked a lot worse in nominal dollar terms than the latter, however, they were more similar than casual analysis would at first appear.
There are lots of *dissimilarities* between the two, that although it took a war to bring us out of the GD, the 68-82 started closer to the beginning of a war, and ended during a time of peace.
However, (suprise suprise) it lasted about 14 years.
If we look at the Japanese realestate/Nikkei crash in this chart:
http://finance.yahoo.com/q/bc?s=%5EN225&t=my&l=on&z=m&q=l&c=
We can see that the Nikkei peaked right at the end of 89/beginning of 1990.
If we extrapolate out our theory, we can speculate that the "bottom" would be put in at the end of 2003 to the beginning of 2004. And, as we see from the chart, the "theory" holds.
Ok...so what? That might help predict when the crash might bottom....but what does it tell us about when the next crash might occur?
Well, on this I need more research and data to be SURE. However, I noted that 1929 to 1968 is a period of 39 years. 39 years is close to the working life of one professional...
39 years is 2X 19.5 years, which could be close to 2 generations removed.
1968 + 39 years = 2007
So, will 2007 be the beginning of major pain the general markets. I think so. It could happen sooner, frankly....I believe it is already happening although one does not see it in the averages yet. I believe that this relative underperformance could be deflationary and it could be inflationary....depending on how the US Federal reserve responds. However I believe there will be relative underperformance.
One way to possibly protect yourself is to move a portion of your wealth out of US dollar denominated assets....Gold, silver, shares of producers of gold, silver, energy, uranium sourced in geopolitically secure areas of the world should continue to outperform.
WARNING: in the case of a panic -- everything will underperform for a minute...maybe even the price of bullion as people (wrongheadedly in my opinion) try to raise cash... in a couple of months (or less) when they realize that it's just paper, the third phase of the great bull market in metals will be released.
Remember, however.....I'm just some conspiracy nut living in South America. This advice should be worth roughly what you just paid for it. :)
ciao for now,
fB
Although I didn't go back past the 1920's, their seems to be an interesting cyclicality in the financial markets evolving....While I can't be certain, I imagine that the birth/work/death cycle of the average human has a lot to do with it. I'm sure others have noticed and pontificated on the causes, but this is newer to me.
Lets talk about the great "busts" in US history
1929-1943(ish)
This is the most famous...The Great Depression. Even though outside forces (apparently) conspired to bring the US out of the GD, notice that is was "about" 14 years
1968-1982
Although most people realize that the market did not perform well during this period, most would think it anywhere near as severe as the GD. That is because the GD was *deflationary* and the 68-82 crash was *inflationary*.
The result was that the GD looked a lot worse in nominal dollar terms than the latter, however, they were more similar than casual analysis would at first appear.
There are lots of *dissimilarities* between the two, that although it took a war to bring us out of the GD, the 68-82 started closer to the beginning of a war, and ended during a time of peace.
However, (suprise suprise) it lasted about 14 years.
If we look at the Japanese realestate/Nikkei crash in this chart:
http://finance.yahoo.com/q/bc?s=%5EN225&t=my&l=on&z=m&q=l&c=
We can see that the Nikkei peaked right at the end of 89/beginning of 1990.
If we extrapolate out our theory, we can speculate that the "bottom" would be put in at the end of 2003 to the beginning of 2004. And, as we see from the chart, the "theory" holds.
Ok...so what? That might help predict when the crash might bottom....but what does it tell us about when the next crash might occur?
Well, on this I need more research and data to be SURE. However, I noted that 1929 to 1968 is a period of 39 years. 39 years is close to the working life of one professional...
39 years is 2X 19.5 years, which could be close to 2 generations removed.
1968 + 39 years = 2007
So, will 2007 be the beginning of major pain the general markets. I think so. It could happen sooner, frankly....I believe it is already happening although one does not see it in the averages yet. I believe that this relative underperformance could be deflationary and it could be inflationary....depending on how the US Federal reserve responds. However I believe there will be relative underperformance.
One way to possibly protect yourself is to move a portion of your wealth out of US dollar denominated assets....Gold, silver, shares of producers of gold, silver, energy, uranium sourced in geopolitically secure areas of the world should continue to outperform.
WARNING: in the case of a panic -- everything will underperform for a minute...maybe even the price of bullion as people (wrongheadedly in my opinion) try to raise cash... in a couple of months (or less) when they realize that it's just paper, the third phase of the great bull market in metals will be released.
Remember, however.....I'm just some conspiracy nut living in South America. This advice should be worth roughly what you just paid for it. :)
ciao for now,
fB
Sunday, October 29, 2006
"CIrcuses" - fuBarrio style....
When I first saw "Bowling for Columbine" it really resonated with me. It said a lot of things....while I didn't agree with all of them, the underlying message of the movie (my takeaway, at least) was "don't live in fear".
The movie was able to encapsulate and communicate some things that had been bothering me about the US for quite some time but had been unable to succintly articulate.
The link below is to a documentary -- online -- that will never get the play of a Michael Moore documentary, but nonetheless has resonated with me in a powerful way.
The first half is about the IRS. The second half is about the Fed. I know, boring subjects, huh? But this guy does a great job of making it entertaining and thought provoking -- to say the least.
Will you watch it? Or will u find something else to fill your time? Will and Grace reruns are on tonight after all. :)
http://video.google.com/videoplay?docid=-4312730277175242198
Anyone with the fortitude to sit through the documentary, fwd me some comments.
ciao for now,
fB
The movie was able to encapsulate and communicate some things that had been bothering me about the US for quite some time but had been unable to succintly articulate.
The link below is to a documentary -- online -- that will never get the play of a Michael Moore documentary, but nonetheless has resonated with me in a powerful way.
The first half is about the IRS. The second half is about the Fed. I know, boring subjects, huh? But this guy does a great job of making it entertaining and thought provoking -- to say the least.
Will you watch it? Or will u find something else to fill your time? Will and Grace reruns are on tonight after all. :)
http://video.google.com/videoplay?docid=-4312730277175242198
Anyone with the fortitude to sit through the documentary, fwd me some comments.
ciao for now,
fB
Monday, October 23, 2006
Drilling down
As you can see from my profile picture to the right, a couple years of unemployment (read: no dental insurance) has left me with what my friends might refer to as a "jacked up grill".
So, as a public service to our readers, and those that get close enough to smell my doggy breath, I decided to visit a dentist here in Montevideo.
Now, visiting a dentist in the US, for me, as well as some others probably, is about one of the scariest things one can do....Just slightly scarier than milking a cobra, or flossing a great white.
One of my friends here recommended his dentist, so I decided to pay her a visit.
One more for the "you know you're old" file: you know you're old when ur dentist is obviously younger than you are!
Natali began the examination and asked all the typical "dentist" questions:
"how many times a day do you brush?
"do you have milkbones between meals?"
"how often do you floss?"
"do you eat hard or canned dog chow?"
"have you been catching frisbees in your teeth lately?"
I already knew that I had THREE cavities rotting away from a visit to a dentist in Concord California a couple of months ago. That dentist had quoted me 1200 to get my teeth fixed....on accident she had quoted me 1100, but once she realized I didn't have insurance (no bargaining power) she gave me the uninsured price of 1200.
I of course pointed out that that was absurd and that she'd get the money faster and with less paperwork from me, so i deserved a better price. She obliged by knocking down the price 10%.
My initial inspection visit with Natali was free -- and she found 4 cavaties (apparently I'd grown another -- I really gotta stop sleeping with that sugar cane mouthguard in!)
I decided to get a cleaning, 4 fillings done and Golden Lotus is getting a couple of fillings done too.
Natali quoted me $40/filling (composite) -- Golden Lotus is going for a "bulk discount" (how sad, huh?)
I had the worst of my cavaties done that day. It was an old USMC filling that another cavity had grown next to/under. She had very gentle hands and I'd have to say that her level of care was on par with or better than any I've had in the States.
(dog) ciao for now,
fB
p.s. i couldn't get the pictures of geant (the post below) to upload to the blog for some reason...but you didn't miss much...just go to any old walmart and multiply by 2x
So, as a public service to our readers, and those that get close enough to smell my doggy breath, I decided to visit a dentist here in Montevideo.
Now, visiting a dentist in the US, for me, as well as some others probably, is about one of the scariest things one can do....Just slightly scarier than milking a cobra, or flossing a great white.
One of my friends here recommended his dentist, so I decided to pay her a visit.
One more for the "you know you're old" file: you know you're old when ur dentist is obviously younger than you are!
Natali began the examination and asked all the typical "dentist" questions:
"how many times a day do you brush?
"do you have milkbones between meals?"
"how often do you floss?"
"do you eat hard or canned dog chow?"
"have you been catching frisbees in your teeth lately?"
I already knew that I had THREE cavities rotting away from a visit to a dentist in Concord California a couple of months ago. That dentist had quoted me 1200 to get my teeth fixed....on accident she had quoted me 1100, but once she realized I didn't have insurance (no bargaining power) she gave me the uninsured price of 1200.
I of course pointed out that that was absurd and that she'd get the money faster and with less paperwork from me, so i deserved a better price. She obliged by knocking down the price 10%.
My initial inspection visit with Natali was free -- and she found 4 cavaties (apparently I'd grown another -- I really gotta stop sleeping with that sugar cane mouthguard in!)
I decided to get a cleaning, 4 fillings done and Golden Lotus is getting a couple of fillings done too.
Natali quoted me $40/filling (composite) -- Golden Lotus is going for a "bulk discount" (how sad, huh?)
I had the worst of my cavaties done that day. It was an old USMC filling that another cavity had grown next to/under. She had very gentle hands and I'd have to say that her level of care was on par with or better than any I've had in the States.
(dog) ciao for now,
fB
p.s. i couldn't get the pictures of geant (the post below) to upload to the blog for some reason...but you didn't miss much...just go to any old walmart and multiply by 2x
Wednesday, October 04, 2006
We visited the U.S. today :)
ok, so it wasn't really the states....but it may as well have been.
we've been looking for a yoga mat for golden lotus, and although we see yoga studios, our lack of local knowledge and a yellow pages has us looking everywhere for a yoga mat sold seperately so GL can do yoga at the house.
i'd heard of a place called "Geant" and could have sworn I saw it not to far from our home, so I jumped in a cab and told him "Geant" -- the cabbie understands me (i think) and begins driving off in a direction that doesn't seem quite right -- i ask him to drive along the water instead and he assures me that he will and starts heading in the opposite direction from where i thought it was (????)
so, now i start doubting that i know where this place is, but decide to just be patient and see -- it turns out this place is way-the-hell-and-gone TM into the suburbs. yeesh -- about 10 minutes into the ride i yell through the bullet proof glass to ask him where we are going and he explains
turns out it was a *beautiful* day -- 30-31 degrees C, or > 87 degrees for you americanos! strong breezes whipped in off the water to cool down your skin. so, the ride was pretty nice -- once i got over the anxiety of not knowing whether the cabbie had decided to drive us to Brazil and see if we could pay the fare.
Once we arrived it was like a little slice of americana (barf!) or should i say china, inc. low, low, low everyday prices!!! alas no yoga mat, but nearly everything else in the world. I guess this is like a Wal*Mart (the ones with the grocery stores attached -- except I've never been in one with a grocery).
I tried to get a "depth of field shot" of *some* of the width of the store, but the camera couldn't really do it justice.
This place was *really* big. The front of the store, which didn't even run the whole width, had 58 cash registers/check out aisles (?!?!)
The front had a parking lot more fit for a stadium.
I also found a little piece of home -- pretty rare here -- in the imported wine aisle...Wente 1998 - about 13 bucks. Damn, that's cheap....although i'm not a big fan of 1998 :)
At the end of this adventure GL is famished and there is nothing to eat except fast-food in the geant food court. We go to McChundlies and she gets a fry and coke. Don't know if this picture captures it, adn this isn't a big enough sample size, but even their McChundlies seems to have better portion control....these fries haven't been eaten out of. That is how they were served to us...about half empty.
fb
we've been looking for a yoga mat for golden lotus, and although we see yoga studios, our lack of local knowledge and a yellow pages has us looking everywhere for a yoga mat sold seperately so GL can do yoga at the house.
i'd heard of a place called "Geant" and could have sworn I saw it not to far from our home, so I jumped in a cab and told him "Geant" -- the cabbie understands me (i think) and begins driving off in a direction that doesn't seem quite right -- i ask him to drive along the water instead and he assures me that he will and starts heading in the opposite direction from where i thought it was (????)
so, now i start doubting that i know where this place is, but decide to just be patient and see -- it turns out this place is way-the-hell-and-gone TM into the suburbs. yeesh -- about 10 minutes into the ride i yell through the bullet proof glass to ask him where we are going and he explains
turns out it was a *beautiful* day -- 30-31 degrees C, or > 87 degrees for you americanos! strong breezes whipped in off the water to cool down your skin. so, the ride was pretty nice -- once i got over the anxiety of not knowing whether the cabbie had decided to drive us to Brazil and see if we could pay the fare.
Once we arrived it was like a little slice of americana (barf!) or should i say china, inc. low, low, low everyday prices!!! alas no yoga mat, but nearly everything else in the world. I guess this is like a Wal*Mart (the ones with the grocery stores attached -- except I've never been in one with a grocery).
I tried to get a "depth of field shot" of *some* of the width of the store, but the camera couldn't really do it justice.
This place was *really* big. The front of the store, which didn't even run the whole width, had 58 cash registers/check out aisles (?!?!)
The front had a parking lot more fit for a stadium.
I also found a little piece of home -- pretty rare here -- in the imported wine aisle...Wente 1998 - about 13 bucks. Damn, that's cheap....although i'm not a big fan of 1998 :)
At the end of this adventure GL is famished and there is nothing to eat except fast-food in the geant food court. We go to McChundlies and she gets a fry and coke. Don't know if this picture captures it, adn this isn't a big enough sample size, but even their McChundlies seems to have better portion control....these fries haven't been eaten out of. That is how they were served to us...about half empty.
fb
Tuesday, October 03, 2006
Oops...I promised some pictures
I tried to get a good pic or two of the lightening/thunder and downpour, but I didn't want to go out in it to get it! :) I wasn't *that* committed.So, I pulled these shots out of the "archives" -- some pics of days with better weather here. The first, is a large park that was adjacent a large "free market" that runs every Saturday near our home....lots marginal quality clothing, but they do have some pretty high quality leather goods, and really nice fruit and veggie markets that run alongside.
The second pic is of some school kids at a public square in "ciudad vieja"(old town)....the third pic is also "ciudad vieja" -- i think that is a male prostitute there on the left-hand side of the pic....but i'm not sure. he looks like everyone else on the street!
A Few of My Favorite Things....
So far I've been pretty complementary regarding my Montevideo/South American experience. In fact, something triggered in me this weekend and I'm starting to feel like this place is my "home" -- maybe it was the awesome weather. Don't be too envious, the skies opened up this afternoon and soaked GL during her walk.
Since we are still "up in the air" regarding how long we'd like to eventually stay, I thought I'd list some things that Montevideo is "missing" that would make it "perfect". Obviously, not all of these things would be possible. Of course, the absence of some of these things are what makes it Montevideo.
I plan to look for "solutions" to some of these "issues" if we decide to stay for longer than 6 months. From this list, you can get a better idea of our lifestyle....most of you probably wouldn't even miss most of these things
Friends and Family -- duh. Of course, having a spare bdrm and an open door policy could help
CNBC --- "someday" maybe these guys will stream their broadcast on the web -- I'd gladly pay.
Cable and a DVR (easy fix if we stay long term).
Naked Cutletts -- Quorn-brand vegetarian food
Permanent Residency Status on my Visa
A part-time job w/ some income :) -- pay here is *really* low, so although this will offset some expenses it is mostly to get involved more in the community.
A MSFT "ergonomic" keyboard
A university that teaches undergrad science courses -- preferrably in English! :)
A barber I can trust -- my locks were shorn last month
A gym with free weights in my neighborhood -- I can't believe how much trouble we've had finding one that is still open -- weird.
A good volunteer job in the city -- more community involvement.
ciao,
fB
Since we are still "up in the air" regarding how long we'd like to eventually stay, I thought I'd list some things that Montevideo is "missing" that would make it "perfect". Obviously, not all of these things would be possible. Of course, the absence of some of these things are what makes it Montevideo.
I plan to look for "solutions" to some of these "issues" if we decide to stay for longer than 6 months. From this list, you can get a better idea of our lifestyle....most of you probably wouldn't even miss most of these things
Friends and Family -- duh. Of course, having a spare bdrm and an open door policy could help
CNBC --- "someday" maybe these guys will stream their broadcast on the web -- I'd gladly pay.
Cable and a DVR (easy fix if we stay long term).
Naked Cutletts -- Quorn-brand vegetarian food
Permanent Residency Status on my Visa
A part-time job w/ some income :) -- pay here is *really* low, so although this will offset some expenses it is mostly to get involved more in the community.
A MSFT "ergonomic" keyboard
A university that teaches undergrad science courses -- preferrably in English! :)
A barber I can trust -- my locks were shorn last month
A gym with free weights in my neighborhood -- I can't believe how much trouble we've had finding one that is still open -- weird.
A good volunteer job in the city -- more community involvement.
ciao,
fB
Sunday, October 01, 2006
A "Peak" into Our Future
Let's face it. Dire prognostications seldom play out the way the pessimists predict.
Why?
I theorize that as events unfold behaviours change and people adjust to the "new current" reality in ways that are nearly impossible to predict before the events unfold.
Recently, a perception that the world is entering (or soon will) enter a "peak" in its ability to produce crude oil -- especially the light sweet stuff that is easy to turn into gasoline -- has left the paneled basements of doomsayers and has started to get notice in more traditional media outlets. Regardless, I still find some not familiar with the concept, but in a nutshell it is this:
All oilfields follow a bell shaped curve in regards to production before they run out of oil. Even though we continue to deplete them, and we spend many billions on new sources, we are not finding enough new ones to replace what we are using. Several of the major oilfields are in decline and the only options that might possibly be left are very expensive due to location, geopolitics, weather, depth of sea, etc. The global oil resources, taken in aggregate are at or near the downside of the bell-curve slope. As the world continues to grow demand, price hikes will be the only thing that can constrain demand.
Enough of the primer. Are we going to "run out"? Is there a shortage?
As I like to say: there is a shortage of $20/barrel oil. there is no shortage of $80/barrel oil.
The sources of oil are very expensive to extract, and the bigger sources are all seemingly in difficult/expensive to extract form.
Here is a recording of an interview that offers more on this story, and how the recent "big find" in the gulf and falling prices effect the fundamentals behind the "peak oil" theory. The interviewer has already drunk the peak oil "kool aid", unfortunately, but Matthew Simmons, author of "Twilight in the Dessert" does a great job of breaking things down. He makes an especially interesting prediction that perhaps the "globalization" of the production of physical things in remote parts of the world is flawed because it assumes that: 1.) cheap labor will continue to be cheap, and 2.) transportation energy will continue to be a non-factor in regards to costs of getting stuff to market.
I know the recording is 40 minutes, but it's a lot easier than reading a big technical book on viscosity levels, and soil permeabilities, depletion rates, etc.
Enjoy!....and I promise a return to more stuff about Montevideo on Monday:
http://www.financialsense.com/Experts/2006/Simmons.html
ciao for now,
FB
Why?
I theorize that as events unfold behaviours change and people adjust to the "new current" reality in ways that are nearly impossible to predict before the events unfold.
Recently, a perception that the world is entering (or soon will) enter a "peak" in its ability to produce crude oil -- especially the light sweet stuff that is easy to turn into gasoline -- has left the paneled basements of doomsayers and has started to get notice in more traditional media outlets. Regardless, I still find some not familiar with the concept, but in a nutshell it is this:
All oilfields follow a bell shaped curve in regards to production before they run out of oil. Even though we continue to deplete them, and we spend many billions on new sources, we are not finding enough new ones to replace what we are using. Several of the major oilfields are in decline and the only options that might possibly be left are very expensive due to location, geopolitics, weather, depth of sea, etc. The global oil resources, taken in aggregate are at or near the downside of the bell-curve slope. As the world continues to grow demand, price hikes will be the only thing that can constrain demand.
Enough of the primer. Are we going to "run out"? Is there a shortage?
As I like to say: there is a shortage of $20/barrel oil. there is no shortage of $80/barrel oil.
The sources of oil are very expensive to extract, and the bigger sources are all seemingly in difficult/expensive to extract form.
Here is a recording of an interview that offers more on this story, and how the recent "big find" in the gulf and falling prices effect the fundamentals behind the "peak oil" theory. The interviewer has already drunk the peak oil "kool aid", unfortunately, but Matthew Simmons, author of "Twilight in the Dessert" does a great job of breaking things down. He makes an especially interesting prediction that perhaps the "globalization" of the production of physical things in remote parts of the world is flawed because it assumes that: 1.) cheap labor will continue to be cheap, and 2.) transportation energy will continue to be a non-factor in regards to costs of getting stuff to market.
I know the recording is 40 minutes, but it's a lot easier than reading a big technical book on viscosity levels, and soil permeabilities, depletion rates, etc.
Enjoy!....and I promise a return to more stuff about Montevideo on Monday:
http://www.financialsense.com/Experts/2006/Simmons.html
ciao for now,
FB
Wednesday, September 27, 2006
Tin-foil Hat Time!!!!
As some of you may know, Paulson, formerly the head of Goldman Sachs was named Treasury Secretary this summer.
FuBarrio stupdily bet that gasoline wouldn't go down by as much as it did.
FuBarrio found this posting online. FuBarrio likes to think he was "snookered", rather than just admitting to being stupid. So, this explanation fits his world view of why he lost his ass(ets) on bets that gasoline prices wouldn't tank:
As most of you folks who drive a car are more than aware, over the past six weeks we’ve all been on the receiving end of welcome reprieve in the price of gas at the pumps. In fact, a good many commodity prices have moderated somewhat over the course of the summer. While I “welcome” cheaper gas just as much as the next guy, I also like to get my head around the reason[s] for precipitous price movements – particularly in prices of commodities that have such a profound influence in my life. After all, it’s often said that knowledge is empowering, isn’t it?
Well, if you happen to be a “Commodities Bull” - last week [Thursday, September 21, 2006] the Wall Street Journal ran an inauspicious article in “Section C” titled, Some Investors Lose Their Zest For Commodities. With the article being “buried” in Section C and the fact that the newsy bit received zero TV time – I wouldn’t be at all surprised if you all missed it.
One person who did not “miss it” was Bill King – he of the King Report fame. Not only did Mr. King “not miss it,” he quickly understood the implications of the content of the article, namely that, Goldman Sachs [on July 12] tweaked the composition of their “benchmark” Goldman Sachs Commodity Index [GSCI].
Not A Big Deal, Right? For those of you who might figure a little “tweaking” of an index is not such a big thing, you might want to consider this; “The Pimco fund has a rival in Oppenheimer Real Asset Fund (QRAAX), which doesn’t use commodity swaps and is therefore unaffected by the SEC ruling. It tracks the Goldman Sachs Commodity Index, which is much more volatile than Pimco’s benchmark.” Or this, “It is public knowledge that PGGM and ABP, two of the largest pension funds in the world, are benchmarked to commodities via a passive allocation to the Goldman Sachs Commodity Index, with ABP between 2-4% and PGGM 4%. Since ABP manages $155bn and PGGM $50bn,….” So let’s just say “a little tweak” in the composition of the much watched and followed Goldman Sachs Commodity Index can [and does] have a profound influence on the composition of funds and institutional money that is tracking it.
The Tweak… So here is what Goldman Sachs did to the GSCI, Prior to Goldman's revision of the Goldman Sachs Commodity Index in July, unleaded gas accounted for 8.45% (dollar weighting) of the GSCI. Now unleaded gas is only 2.30%.
So What’s Wrong With This? As Bill King points out, “Goldman's changes probably induced arbs, commercial hedgers, and other traders to sell September and October unleaded gasoline future contracts to avoid possible (settlement, delivery, etc.) problems. September futures expired in August; October contracts expire September 29. So unleaded gasoline prices collapsed in August and September.” I would like to “restate” what Mr. King said: What this means folks, is that hedge funds and institutional money that “TRACKS THE INDEX” were FORCED TO SELL 75% of their gasoline futures to conform with the reconstituted GSCI.
And if anyone hasn’t noticed the timing of the price of the gasoline price collapse…just in time for November’s Mid Term Elections! So don’t be fooled into believing that potential energy shortages have “magically been solved.” In all likelihood – much of the recent decline in the price of gasoline we have all “welcomed” has been the result of paper tricks being played on what amounts to a wealthy flock of sheep. But in the meantime, filler up! Rob Kirby, Sept. 25, 2006
FuBarrio stupdily bet that gasoline wouldn't go down by as much as it did.
FuBarrio found this posting online. FuBarrio likes to think he was "snookered", rather than just admitting to being stupid. So, this explanation fits his world view of why he lost his ass(ets) on bets that gasoline prices wouldn't tank:
As most of you folks who drive a car are more than aware, over the past six weeks we’ve all been on the receiving end of welcome reprieve in the price of gas at the pumps. In fact, a good many commodity prices have moderated somewhat over the course of the summer. While I “welcome” cheaper gas just as much as the next guy, I also like to get my head around the reason[s] for precipitous price movements – particularly in prices of commodities that have such a profound influence in my life. After all, it’s often said that knowledge is empowering, isn’t it?
Well, if you happen to be a “Commodities Bull” - last week [Thursday, September 21, 2006] the Wall Street Journal ran an inauspicious article in “Section C” titled, Some Investors Lose Their Zest For Commodities. With the article being “buried” in Section C and the fact that the newsy bit received zero TV time – I wouldn’t be at all surprised if you all missed it.
One person who did not “miss it” was Bill King – he of the King Report fame. Not only did Mr. King “not miss it,” he quickly understood the implications of the content of the article, namely that, Goldman Sachs [on July 12] tweaked the composition of their “benchmark” Goldman Sachs Commodity Index [GSCI].
Not A Big Deal, Right? For those of you who might figure a little “tweaking” of an index is not such a big thing, you might want to consider this; “The Pimco fund has a rival in Oppenheimer Real Asset Fund (QRAAX), which doesn’t use commodity swaps and is therefore unaffected by the SEC ruling. It tracks the Goldman Sachs Commodity Index, which is much more volatile than Pimco’s benchmark.” Or this, “It is public knowledge that PGGM and ABP, two of the largest pension funds in the world, are benchmarked to commodities via a passive allocation to the Goldman Sachs Commodity Index, with ABP between 2-4% and PGGM 4%. Since ABP manages $155bn and PGGM $50bn,….” So let’s just say “a little tweak” in the composition of the much watched and followed Goldman Sachs Commodity Index can [and does] have a profound influence on the composition of funds and institutional money that is tracking it.
The Tweak… So here is what Goldman Sachs did to the GSCI, Prior to Goldman's revision of the Goldman Sachs Commodity Index in July, unleaded gas accounted for 8.45% (dollar weighting) of the GSCI. Now unleaded gas is only 2.30%.
So What’s Wrong With This? As Bill King points out, “Goldman's changes probably induced arbs, commercial hedgers, and other traders to sell September and October unleaded gasoline future contracts to avoid possible (settlement, delivery, etc.) problems. September futures expired in August; October contracts expire September 29. So unleaded gasoline prices collapsed in August and September.” I would like to “restate” what Mr. King said: What this means folks, is that hedge funds and institutional money that “TRACKS THE INDEX” were FORCED TO SELL 75% of their gasoline futures to conform with the reconstituted GSCI.
And if anyone hasn’t noticed the timing of the price of the gasoline price collapse…just in time for November’s Mid Term Elections! So don’t be fooled into believing that potential energy shortages have “magically been solved.” In all likelihood – much of the recent decline in the price of gasoline we have all “welcomed” has been the result of paper tricks being played on what amounts to a wealthy flock of sheep. But in the meantime, filler up! Rob Kirby, Sept. 25, 2006
Tuesday, September 26, 2006
More "non-news" you can use
This just in :) : housing is finally going down in the US!
Seriously, I thought this was the oldest story on the planet. But after talking to a few people who live in areas where housing price changes have traditionally been more moderate, I found some people who didn't realize this was happening....or worse, figured it wouldn't happen in their neck of the woods.....
While plenty of well known and respected economists debate the degree of the slowdown, I think it will be a very difficult time for either home values or the dollar or both- everywhere.
Why?
Because the seeds of this bubble -- ridiculously loose credit standards, coupled with low interest rates -- are not regional phenomenae. Both are/were national, if not worldwide, drivers, meaning too much debt was chasing too few goods.
NATIONWIDE, median home prices have gotten WAY AHEAD of incomes. The median home in the US is selling at 3.7X the median US income. In some "hotter" areas, it's much, much higher. The historical average is 2.8X the median income.
(note: --if you are thinking about buying, waiting for the price drop to move in DO NOT BUY until the median price to median income is AT LEAST back to the historical average in your area. The reality is, the price will probably "overshoot" on the way down. Don't try to catch a falling chainsaw....while it is still running....while blindfolded.....between your legs!!! )
Why is 2.8X the historical standard? Well, much beyond 3X and a reasonable person would start to doubt the borrowers ability to repay the loan. However, as many of you know, the banks have gotten more and more creative with their financial engineering in an attempt to keep the ponzi scheme alive. While enumerating the multitude of products that allow buyers to lower their monthly and down payments would be interesting, the biggest reason has been the "securitization" of the loans. By "securitizing" the loan, they sell the debt to someone else, take down a HEFTY fee for doing the paperwork, and move on....
If you don't have to worry about being repaid personally (or your company) it all becomes a giant game/puzzle for the loan broker to figure out how to get you to qualify for the loan to get you into the house of your nightmares. Here is an interesting story out of the bay area, as the media is FINALLY starting to report on this.
http://cbs5.com/30minutes/local_story_266005029.html
Unfortunately, the ramifications will not be felt only by those participating/benefitting from "liars loans". Undoubtedly, the backlash will mean *overly restrictive lending practices*.
Newly self-employed will probably not have "stated income" loans as an option in the future.
Comps will crash for newly purchased homes once bkruptcies, foreclosures, and short-sales begin. A family needing to move for work or another valid reason will be stuck upside down in a loan valued more than their house.
Empty, or half-finished housing developments will forever scar the neighborhoods of people who were responsible with their debt, and the housing debacle will have ramifications unforeseen to this point.
In the end, perhaps we shouldn't worry:
-perhaps these are the ravings of another chicken little
-perhaps people will abandon living outside of their means, relinquish the McMansion in favor of something that doesn't take as many resources to maintain, OR start living in their McMansions with a larger portion of their extended family or families. That would probably be good for the social fabric, imo...although it would certainly create "new" stresses people are unfamiliar with.
-perhaps, sane lending practices will return without a gross overadjustment, which could make it difficult for some deserving people to get credit.
-perhaps the dollar will just adjust downward gradually, letting debt ridden citizens, and the govt, pay back its bloated debt with cheaper paper.
In the end, however, probably just more of the same....
-"woe's me", innocents, taken in by greedy corrupt system in the press.
- lawyers filing class actions against everyone (and their mother).
- politicians cracking down with an overly heavy hand after much grandstanding and chest thumping. government bailouts for everyone with tax monies collected from those that were actually responsible.
- carpetbaggers (realtors and mortgage brokers) moving on to the next bubble-de-jour.
What will it be? precious metals? bullets? bottled water? fed printing presses?....or tickets to South America? :)
ciao for now,
fB
Seriously, I thought this was the oldest story on the planet. But after talking to a few people who live in areas where housing price changes have traditionally been more moderate, I found some people who didn't realize this was happening....or worse, figured it wouldn't happen in their neck of the woods.....
While plenty of well known and respected economists debate the degree of the slowdown, I think it will be a very difficult time for either home values or the dollar or both- everywhere.
Why?
Because the seeds of this bubble -- ridiculously loose credit standards, coupled with low interest rates -- are not regional phenomenae. Both are/were national, if not worldwide, drivers, meaning too much debt was chasing too few goods.
NATIONWIDE, median home prices have gotten WAY AHEAD of incomes. The median home in the US is selling at 3.7X the median US income. In some "hotter" areas, it's much, much higher. The historical average is 2.8X the median income.
(note: --if you are thinking about buying, waiting for the price drop to move in DO NOT BUY until the median price to median income is AT LEAST back to the historical average in your area. The reality is, the price will probably "overshoot" on the way down. Don't try to catch a falling chainsaw....while it is still running....while blindfolded.....between your legs!!! )
Why is 2.8X the historical standard? Well, much beyond 3X and a reasonable person would start to doubt the borrowers ability to repay the loan. However, as many of you know, the banks have gotten more and more creative with their financial engineering in an attempt to keep the ponzi scheme alive. While enumerating the multitude of products that allow buyers to lower their monthly and down payments would be interesting, the biggest reason has been the "securitization" of the loans. By "securitizing" the loan, they sell the debt to someone else, take down a HEFTY fee for doing the paperwork, and move on....
If you don't have to worry about being repaid personally (or your company) it all becomes a giant game/puzzle for the loan broker to figure out how to get you to qualify for the loan to get you into the house of your nightmares. Here is an interesting story out of the bay area, as the media is FINALLY starting to report on this.
http://cbs5.com/30minutes/local_story_266005029.html
Unfortunately, the ramifications will not be felt only by those participating/benefitting from "liars loans". Undoubtedly, the backlash will mean *overly restrictive lending practices*.
Newly self-employed will probably not have "stated income" loans as an option in the future.
Comps will crash for newly purchased homes once bkruptcies, foreclosures, and short-sales begin. A family needing to move for work or another valid reason will be stuck upside down in a loan valued more than their house.
Empty, or half-finished housing developments will forever scar the neighborhoods of people who were responsible with their debt, and the housing debacle will have ramifications unforeseen to this point.
In the end, perhaps we shouldn't worry:
-perhaps these are the ravings of another chicken little
-perhaps people will abandon living outside of their means, relinquish the McMansion in favor of something that doesn't take as many resources to maintain, OR start living in their McMansions with a larger portion of their extended family or families. That would probably be good for the social fabric, imo...although it would certainly create "new" stresses people are unfamiliar with.
-perhaps, sane lending practices will return without a gross overadjustment, which could make it difficult for some deserving people to get credit.
-perhaps the dollar will just adjust downward gradually, letting debt ridden citizens, and the govt, pay back its bloated debt with cheaper paper.
In the end, however, probably just more of the same....
-"woe's me", innocents, taken in by greedy corrupt system in the press.
- lawyers filing class actions against everyone (and their mother).
- politicians cracking down with an overly heavy hand after much grandstanding and chest thumping. government bailouts for everyone with tax monies collected from those that were actually responsible.
- carpetbaggers (realtors and mortgage brokers) moving on to the next bubble-de-jour.
What will it be? precious metals? bullets? bottled water? fed printing presses?....or tickets to South America? :)
ciao for now,
fB
Monday, September 25, 2006
Are You Ready for some Futbol???
Nothing seems more "American" than a crisp fall air and a game of pickup football. These "Americans" would agree...
Of course, to be technically correct, they are South Americans, the game is "futbol" (soccer) and I guess it's crisp Spring air this time of year.
I got invited to go play some futbol with some Uruguayos. I was so amped to join in on the national passtime I managed to supress my horror at hearing the game would begin at 7. I was incredibly relieved later to find out that the game was actually being played at 7 PM...not AM as I had feared.
I was further relieved to hear that it would be played on a miniaturized version of a field (less running!) and the game would only last an hour vs. the more typical 1.5 hours....
As it turns out, i was being invited to participate in a game of "cincos" -- five on five -- often played (as in this case) on rugged aritificial turf with miniaturized goals and a mini-field. Although I'd never played "cincos" a friend had told me just a week before that he was constructing a "cincos" field in Costa Rica complete with walls, roof (for weather I imagine), lights, etc. Apparently, it's all the rage. As you might imagine, it's easier to get together 10 people to play, than the traditional 22, and people pay to 'rent' the fields by the hour.
I blame my ignorance of cincos to the fact that I haven't played soccer in YEARS, and to the fact that the US just isn't as "into" the sport as they are south of the border (and elsewhere).
When we arrived at the field, from the condition of the "turf" it was clear that it was getting a LOT of use, and it had likely been in use for some number of years. The "turf" wasn't astroturf, but basically, that green plastic fake grass crap that people put on their patios(or used in bad Easter displays in stores) in the 70's glued to the concrete subfloor.....slide tackles are a no-no, and falling down is discouraged as my still noticeable limp (days after) will attest.
This field had neither roof, nor walls, but lights. The fields are down by the water -- which is probably a nice feature on a warmer night. That night, my lungs were no match for the cold air. Luckily, we took turns playing "keeper" and right about the time I was about to pass out and take a "header" into the plastic turf it was my turn in goal.
It is a really good way to meet a bunch of locals, and even better if you have any kind of fitness or ball skills. All in all, it was a ton of fun, and I fully intend on trying to get in shape and "represent" for the US on the off chance I'm "reinvited" -- as soon as I can walk again.
peace,
fuBarrio
Of course, to be technically correct, they are South Americans, the game is "futbol" (soccer) and I guess it's crisp Spring air this time of year.
I got invited to go play some futbol with some Uruguayos. I was so amped to join in on the national passtime I managed to supress my horror at hearing the game would begin at 7. I was incredibly relieved later to find out that the game was actually being played at 7 PM...not AM as I had feared.
I was further relieved to hear that it would be played on a miniaturized version of a field (less running!) and the game would only last an hour vs. the more typical 1.5 hours....
As it turns out, i was being invited to participate in a game of "cincos" -- five on five -- often played (as in this case) on rugged aritificial turf with miniaturized goals and a mini-field. Although I'd never played "cincos" a friend had told me just a week before that he was constructing a "cincos" field in Costa Rica complete with walls, roof (for weather I imagine), lights, etc. Apparently, it's all the rage. As you might imagine, it's easier to get together 10 people to play, than the traditional 22, and people pay to 'rent' the fields by the hour.
I blame my ignorance of cincos to the fact that I haven't played soccer in YEARS, and to the fact that the US just isn't as "into" the sport as they are south of the border (and elsewhere).
When we arrived at the field, from the condition of the "turf" it was clear that it was getting a LOT of use, and it had likely been in use for some number of years. The "turf" wasn't astroturf, but basically, that green plastic fake grass crap that people put on their patios(or used in bad Easter displays in stores) in the 70's glued to the concrete subfloor.....slide tackles are a no-no, and falling down is discouraged as my still noticeable limp (days after) will attest.
This field had neither roof, nor walls, but lights. The fields are down by the water -- which is probably a nice feature on a warmer night. That night, my lungs were no match for the cold air. Luckily, we took turns playing "keeper" and right about the time I was about to pass out and take a "header" into the plastic turf it was my turn in goal.
It is a really good way to meet a bunch of locals, and even better if you have any kind of fitness or ball skills. All in all, it was a ton of fun, and I fully intend on trying to get in shape and "represent" for the US on the off chance I'm "reinvited" -- as soon as I can walk again.
peace,
fuBarrio
Thursday, September 21, 2006
Kiss of Death
Shortly after arriving in Montevideo, FuBarrio came down with a brief cold, and a few weeks later, even Golden Lotus was suffering from flu-like symptoms.
The reason this is worth noting is that because of FuBarrio's hermit like tendencies, gruff exterior, scowling demeanor, pessimism, crumudgeon-ism, third person self-referencing tirades, and general dislikaility usually keep him well insulated from from the populace at large, and by extention, communicable disesases.
(side note: Of course, the sad tragedy in all of this is that FuBarrio's Uni-Bomberesque facade is merely a defensive mask....All those who have actually gotten to know FuBarrio (both of you) realize that deep down FuBarrio craves the respect, admiration, idoliz --- uh, i mean, admiration of his fellow man.)
However, FuBarrio was attempting to turn over a new leaf in his new home. He promised to leave the house more than once every 8 weeks, and to try to adopt some of the local customs. While some of the local customs, like enjoying 3 hour italian lunches laden with nice argentine and uruguayan reds were easy to come by, others were a little more difficult to get used to.
I know, you're thinking, "what in the world could FuBarrio not adjust to? After all, he has already cut back to no more than three twinkies per day, and has only broken that self imposed limit twice since last week....both times during very volatile days in the market! He's a obviously a veritable chameleon."
It's the kissing.
Uruguayans, and I imagine Argentines, when greating each other (even people you don't know but are meeting for the first time) kiss each other cheek to cheek. FuBarrio, sensing his personal space being invaded, immediately grew his beard out to Grizzly Adams-esque proportions.....to no avail. These Montevideans are very dedicated to their customs! Neither a beard that would make ZZ top jealous, nor a bathing frequency not seen since 15th century France, seemed to make any difference. Never once did anyone shy away from the obligatory kiss (?!?!)
OK...not a real kiss, but a cheek to cheek "air kiss" a la Hollywood....except only on one side, and not just with fellow star-lettes. Basically, everyone does this. Girls are expected to "kiss" everyone -- with both other girls and guys. And, with some of the younger generation, guys kiss guys....yikes! :)
Guys my age apparently, can just get away with kissing the females. When meeting ones real estate agent, when meeting her assistants, when meeting, greeting or saying goodbye to ones cleaning lady, neighbors, waitresses u get to know, the woman who sold me dsl when i went in to sign the contract, all constitute obvious times to exchange a kiss apparently.
So....did all this kissing contribute to our illnesses??? Have Uruguayos' frequent cheek to cheek interludes increased the countrymen's resistance to communicable diseases??? FuBarrio cannot be sure without more medical evidence.
All this aside however, FuBarrio has found a much more awkward problem associated with all this kissing. Not known for social graces, he has been trying to look suave while kissing total strangers at times.....(remember FuBarrio secretly wants to be loved). However, when kissing a stranger, where does one put their hands????
In FuBarrio's very limited North American experience, if you're going to try to kiss someone -- even an air kiss Zsa Zsa style -- you're probably going to be hugging them first -- or just done hugging them....viola...awkward hand problem solved!
Au contrair (to keep with the frenchy theme)...Apparently, that would be a lot more forward of an approach in Uruguay -- and one best not attempted with the woman who just had you sign your dsl contract -- who's to know? :)
Seriously though, what exactly to do with the hands??? I found them falling awkwardly around the waist of women 30 years my senior......oh....my hand didn't slip and touch her butt did it???
OK...here's the skinny...which i'm sure has seemed perfectly obvious to all of you more cosmopolitan readers....I think I've figured it out:
Reach out with right hand, palm down and cup their right hand....not exactly like a shake....but, with fingers looked. Next, pull them toward you....if necessary, it's a nice touch to cup under the "shake" with your left hand, but remember....you're not really shaking in the North American sense of the word....just steadying yourself and drawing a vector on that space about 1/4 to the outside of this stranger's right cheek.
Next, move in, always to the left, usually without actually touching them and do a Hollywood "air kiss"..... and remember, unlike Costa Rica, and other locales u might be familiar with, only on one side here. After all, kissing guy friends on BOTH cheeks would be kinda gay! :)
ciao, xxx's, no ooo's (or did i get that backward?)
fB
The reason this is worth noting is that because of FuBarrio's hermit like tendencies, gruff exterior, scowling demeanor, pessimism, crumudgeon-ism, third person self-referencing tirades, and general dislikaility usually keep him well insulated from from the populace at large, and by extention, communicable disesases.
(side note: Of course, the sad tragedy in all of this is that FuBarrio's Uni-Bomberesque facade is merely a defensive mask....All those who have actually gotten to know FuBarrio (both of you) realize that deep down FuBarrio craves the respect, admiration, idoliz --- uh, i mean, admiration of his fellow man.)
However, FuBarrio was attempting to turn over a new leaf in his new home. He promised to leave the house more than once every 8 weeks, and to try to adopt some of the local customs. While some of the local customs, like enjoying 3 hour italian lunches laden with nice argentine and uruguayan reds were easy to come by, others were a little more difficult to get used to.
I know, you're thinking, "what in the world could FuBarrio not adjust to? After all, he has already cut back to no more than three twinkies per day, and has only broken that self imposed limit twice since last week....both times during very volatile days in the market! He's a obviously a veritable chameleon."
It's the kissing.
Uruguayans, and I imagine Argentines, when greating each other (even people you don't know but are meeting for the first time) kiss each other cheek to cheek. FuBarrio, sensing his personal space being invaded, immediately grew his beard out to Grizzly Adams-esque proportions.....to no avail. These Montevideans are very dedicated to their customs! Neither a beard that would make ZZ top jealous, nor a bathing frequency not seen since 15th century France, seemed to make any difference. Never once did anyone shy away from the obligatory kiss (?!?!)
OK...not a real kiss, but a cheek to cheek "air kiss" a la Hollywood....except only on one side, and not just with fellow star-lettes. Basically, everyone does this. Girls are expected to "kiss" everyone -- with both other girls and guys. And, with some of the younger generation, guys kiss guys....yikes! :)
Guys my age apparently, can just get away with kissing the females. When meeting ones real estate agent, when meeting her assistants, when meeting, greeting or saying goodbye to ones cleaning lady, neighbors, waitresses u get to know, the woman who sold me dsl when i went in to sign the contract, all constitute obvious times to exchange a kiss apparently.
So....did all this kissing contribute to our illnesses??? Have Uruguayos' frequent cheek to cheek interludes increased the countrymen's resistance to communicable diseases??? FuBarrio cannot be sure without more medical evidence.
All this aside however, FuBarrio has found a much more awkward problem associated with all this kissing. Not known for social graces, he has been trying to look suave while kissing total strangers at times.....(remember FuBarrio secretly wants to be loved). However, when kissing a stranger, where does one put their hands????
In FuBarrio's very limited North American experience, if you're going to try to kiss someone -- even an air kiss Zsa Zsa style -- you're probably going to be hugging them first -- or just done hugging them....viola...awkward hand problem solved!
Au contrair (to keep with the frenchy theme)...Apparently, that would be a lot more forward of an approach in Uruguay -- and one best not attempted with the woman who just had you sign your dsl contract -- who's to know? :)
Seriously though, what exactly to do with the hands??? I found them falling awkwardly around the waist of women 30 years my senior......oh....my hand didn't slip and touch her butt did it???
OK...here's the skinny...which i'm sure has seemed perfectly obvious to all of you more cosmopolitan readers....I think I've figured it out:
Reach out with right hand, palm down and cup their right hand....not exactly like a shake....but, with fingers looked. Next, pull them toward you....if necessary, it's a nice touch to cup under the "shake" with your left hand, but remember....you're not really shaking in the North American sense of the word....just steadying yourself and drawing a vector on that space about 1/4 to the outside of this stranger's right cheek.
Next, move in, always to the left, usually without actually touching them and do a Hollywood "air kiss"..... and remember, unlike Costa Rica, and other locales u might be familiar with, only on one side here. After all, kissing guy friends on BOTH cheeks would be kinda gay! :)
ciao, xxx's, no ooo's (or did i get that backward?)
fB
Sunday, September 17, 2006
The Return of 'Bread and Circuses'
FuBarrio's mood has lightened considerably the last week.
His once deeply furrowed brow has lightened to a mildly-pleasant arch....The sun is shining, birds are chirping, glorious spring is in the air. Unleaded is under 2.50 a gallon, and with any luck, in the near future mere mortals may consider international travel as a possibility without first leveraging another HELOC outa the ol' homestead.
However, all this pales in comparison to the profound importance of the return of the almighty "bread and circuses"TM (twinkies and cable t.v.) :)
OK...Well, to be honest, we still have neither here in Montevideo. However, GL made a brilliant find called 'medialunas' or "half-moons" to the linguistically challenged. These are basically croissants (uh...is that spelled right?) but SOFT and with honey drizzled over the top....almost "spongecake" like in texture...you see where I'm going with this right?
In addition, I was able to listen to a radio broadcast of my Huskies' 2nd half collapse against the Sooners, AND I was able to watch 'Survivor' online (damn that show is stoopid -- why do i enjoy it so much?)
If I watch Survivor at the same time as eating a medialuna I almost don't even notice that they are missing the artificial whipped sugar-oil filling and assorted preservatives that keep the mental accuities of fuBarrio well lubricated while state-side.
Of course, all of this romantic opulence may have unintended side effects; like, bringing down an empire, and/or referring to oneself in the third person whilst enjoying serious waves of meglomania -- All in all, totally worth it!
Hail Caesar!...er, I mean "four more years!!!"
fuBarrio
His once deeply furrowed brow has lightened to a mildly-pleasant arch....The sun is shining, birds are chirping, glorious spring is in the air. Unleaded is under 2.50 a gallon, and with any luck, in the near future mere mortals may consider international travel as a possibility without first leveraging another HELOC outa the ol' homestead.
However, all this pales in comparison to the profound importance of the return of the almighty "bread and circuses"TM (twinkies and cable t.v.) :)
OK...Well, to be honest, we still have neither here in Montevideo. However, GL made a brilliant find called 'medialunas' or "half-moons" to the linguistically challenged. These are basically croissants (uh...is that spelled right?) but SOFT and with honey drizzled over the top....almost "spongecake" like in texture...you see where I'm going with this right?
In addition, I was able to listen to a radio broadcast of my Huskies' 2nd half collapse against the Sooners, AND I was able to watch 'Survivor' online (damn that show is stoopid -- why do i enjoy it so much?)
If I watch Survivor at the same time as eating a medialuna I almost don't even notice that they are missing the artificial whipped sugar-oil filling and assorted preservatives that keep the mental accuities of fuBarrio well lubricated while state-side.
Of course, all of this romantic opulence may have unintended side effects; like, bringing down an empire, and/or referring to oneself in the third person whilst enjoying serious waves of meglomania -- All in all, totally worth it!
Hail Caesar!...er, I mean "four more years!!!"
fuBarrio
Saturday, September 16, 2006
Our "barrio" (neighborhood)
The street we live on is relatively "busy" -- it is divided by a median in the front, and it is one of the main arterials for moving about Montevideo.We aren't on the water, nor do we have a view. However, I noticed while on the upper terrace (aka roof), that we have what US RE agents would describe as a "peek-a-boo" view of the water :) -- I can almost read the sales writeup now! (if you still don't see it look to the right of the tip of the red chimney)
While walking back from a walk yesterday I snapped a photo of one a quaint street. They don't all look like this! But, a street that looks like this is not considered "rare" here either. The guy on the bike is delivering food (more than likely). Many, many nice restaurants deliver here.
Golden Lotus captured the shot below outside of a corner market. This is *very* common for the local corner store (very very small stores) to have fresh fruits and vegetables. Jeez...at a state-side 7-11, which averages about 3 times the size, you're lucky if you can find orange fanta for a fruit, and relish for your hotdog to make up your "veggie group". I guess they need all that floor space for the "hostess" aisle. 
The ease (acceptability) of walking and the "euro" diet really seem to show up in the waistlines down here. There just aren't as many heavy-set people. I know, you're thinking "you mean diet and exercise play a role???". I guess my point is, it's not difficult to do here. It's just a natural part of the lifestyle. It's not some conscious (difficult) thing you have to do everyday. It just happens.The guy with the horse is doing garbage collection. While I've seen some big trucks empting dumpsters, a majority of all the garbage collection is done daily by what seems like a large "fleet" of working horses.
Confucious say: 'forget glass house, Montevideo Rocks!'
Confucious, from Rodo Park, looking out over the "rambla" in Montevideo GL and I took a couple of snap shots recently that I wanted to share with you all. The first is at the "base" of Rodo Park. Rodo park runs up from one of the waterfronts, and has several "carnival" areas, outdoor ampitheaters, playgrounds, sports facilities, walking paths, etc. I wrote about "Parque Rodo" previously, but I didn't bring my camera on the previous trip. This post, I've included some selected pictures of the walk to parque rodo and the park itself to give you a better "feel".
Friday, September 15, 2006
Good News...We're "Zombie Proof"!!!
storm shutters half-drawn on one of our back windows
Good News, everyone....Golden Lotus has informed me that our home is "zombie proof". :) Uh....those of you that know Golden Lotus well know that she was being as serious as someone can be when announcing such a feature.
Aside from having a heavy front door, living in a second floor flat, and possessing a flat roof with no exterior access (good for standing on top of and watching the masses of flesh eating undead staggering and limping through the streets of Montevideo I suppose) we have *storm shutters*.
Storm shutters seem to be a common feature of a lot of homes in Montevideo and are controlled by a pulley system inside the house. Lots of people pull them down at night. I like them because they help me sleep in a bit (until the neighbors noisily draw their's up each morning at 8ish). In addition, I have the fantasy that the storm shuttters help keep some heat in the house at night.
So, not to brag or anything, but ON TOP of being relatively safe from northern hemispherical thermo-nuclear war and the resulting fallout -- now I find out that we are "zombie proof". I bet you're all green with envy.
PEACE,
fuBarrio
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