Archive for October, 2007

Simulated Boom?

October 22, 2007

I’ve been wanting to write about the economy for some time now, both because it’s interesting to me, and because I think we’re living in interesting economic times. If this sort of thing bores you, stop reading now (you’re already doomed anyway).

For the past couple years I’ve been watching the markets closely, trying to make sense of things and forming some models in my head. I made a large bet against the US dollar in 01/2006 (MERKX) and haven’t been disappointed so far. Last week I made another big move, changing my 401(k) asset allocation to 100% cash equivalents (FDAXX). My gambling money is out of stocks excepting of a single fund with holdings in the energy and natural resources sector. Even that may be a mistake.

I’m not really concerned about missing out on any market surge due to future interest rate cuts. If the market gains 1% and the dollar declines 1%, have you really gained anything? Think of what a foreign investor would see. The US market gains of the past few years look pretty sad when measured in euros. Now factor in inflation in the foreign currency of our choice. Has the “boom” market even been a reasonable store of value, let alone gains?

This all leads me to my latest market conjecture. Some pundits are now starting to talk about recession. It’s certainly hard to ignore the housing market and mortgage lender woes. Here’s the thing: When has a recession ever started with foreclosures and bank failures? These are trailing indicators. We’re now starting to see some leading indicators in consumer sentiment, reduced spending, and narrowing profit margins in consumer staples.

Isn’t it possible that we’re almost seven years into a stealth recession masquerading as a boom due to low interest rates and easy credit? Somewhere along the way people have confused debt with money. After all, they seem pretty similar until the repo man shows up. So here we are, with some indicators that we’re well into a recession and some indicators that we’re about to enter a recession. How long before we start hearing the “d” word? The next few weeks should be very interesting. I’ve placed my bets, have you?

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What’s in a name?

October 14, 2007

Gentle readers,

By now I’m certain you’re aware that all names mentioned on this blog have been changed to protect the privacy of the individuals involved. When I say “mom” I’m not actually referring to my mother, and so on. Thus it is that my privacy policy and scrupulous ethics prevent me from relating the following:

Years ago, my parents, like so many of those WASPy parents entirely too obsessed with their “baby to be”, devoted hour upon hour to the baby naming challenge.

My father, being a profoundly spiritual man, wanted to name me “Enos”. Now this may be somewhat apocryphal, as I don’t remember dad mentioning this tidbit until I was old enough to be embarrassed by the schoolyard teasability quotient of such a name.

My mother, being a freethinking woman, immediately proclaimed a ban on all biblical names. Thus it was that Enos, that grand and most solemn name, was removed from further consideration. Mom’s counter proposal was that they name me “Holland”. And it very nearly happened.

A few months ago, being the self-obsessed creature I clearly am, I was mulling over on the alternate history possibilities of the Holland-naming. Then I spoke it aloud, first-name last-name. Wham! Through this simple action I triggered the collapse of the Holland-world. Try it yourself if you’re privy to my family name.

My mother now claims she was ignorant of the obvious defect of the Holland-naming. I don’t know what to believe any more. Considering both this and the previously mentioned ham and cheese sandwich incident, I must now accept the possibility that my mother is embroiled in an emulsion-themed plot detrimental to my safety.

Will update further when I’m able.

Houseguests

October 12, 2007

I’ve been settling into the old homestead, continuing to unpack (not even close), decorate, make minor repairs, etc. Still feels like there’s a lot to do. If this was just an apartment, I think I’d feel about done already. But no, I’ve got the old house, garage, barn, and the surrounding grounds to manage. Home ownership is like a job where one pays rather than receives money. Kind of like University or (I’m guessing here) raising a child. It’s time to start seriously recruiting for my compound. I require additional laborors to achieve self sufficiency. Maybe I should offer a signing bonus?

The last couple of weeks I’ve been entertaining guests from California. Dave had some trouble getting here (thanks, NWA) and was without his checked bag for a while. Still, we had beautiful, very summerlike, weather during Dave’s entire stay. Sunny and in the 70s and 80s. Dave was able to swim in my parent’s pond twice and once in the ocean. The foliage was still a bit early and weak due to the dry and warm weather. Dave’s now threatening to come back in the winter to test how bad it really gets. Honestly, I’d rather go visit him in California at that time!

Now Debbie has arrived (no problems at all) and has come bearing frozen potstickers from Millie’s (Yat Sing in SF Bay Area)! I really miss good Chinesey food here. Now the weather’s taken a turn for wetter. I’m hoping we get some clear days to actually appreciate the fall scenery. Off to Phil’s diner, a friday morning tradition, for breakfast. More to follow later.