Sunday, November 30, 2008

We need a bailout

I was going to remove the comment suggesting that "We need a bailout." It seems like its non-responsive. That said, I thought better of it. I feel like I have heard something similar to that a alot: Why spend all that money on car companies, banks, or whatever; How about spending it on me.

Well, what does that mean? I presume people want a check. Or, do they want Uncle Sam to pay their credit card debt and mortgage? What do you want? I don't have credit card debt, and I have a very affordable mortgage. I would be OK with the government paying it off, except I know that I will need to still pay the same amount in taxes or inflation (another form of a Tax)... So why bother.

The Airport

I arrived at the Airport today, to protect the stupid I will leave the name of the city out, to see a sign flashing above the baggage claim. "If you see unattended baggage please call 911". Under the sign was about 200 unattended bags.

I thought about calling but figured this can't be worth the hassle, so I left.

Friday, November 28, 2008


One more thing - I have to put in a plug for the best Lebanese cookbook of all time (and perhaps, after Joy of Cooking, the best cookbook of all time). We used it extensively for our Thanksgiving feast yesterday.

It is Lebanese Cookbook, by Dawn, Elaine and Selwa Anthony. Very authentic recipes and beautiful food photos too.


While JK^2 talks about current events, like the bailout, I'm going to tell you about our personal current events! That means Thanksgiving.

We had a really nice holiday. In fact, probably one of the best in a long time.

Our Menu:
Shish Kabobs (cooked on our grill)
Regular salad
Pita Bread
Apple Pie

Jim did pretty much all the cooking. The key was that he cooked a couple of dishes each night for a couple of days leading up to the dinner. That made things much less stressful.

On our table, we had my grandparents' 1938 china, and silverware that is probably older than that (from my great-grandparents, the Rechs). Here are photos of our table:

Our Guest List:
Besides us, we had my mom, our friends Mark and Lauren, who also live in Quincy, and Lauren's brother Matt, visiting from Norman, Oklahoma.

The day of Thanksgiving started at around 1:15am. My mom's flight was 7 hours late: supposed to arrive at 7:30pm; actually arrived around 2:30am. A little disappointing for Jet Blue. We went to bed at the normal time and got up at 1:15 to drive to the airport. Poor Mom. She had been awake since 4am that day, between bringing Buddy to the kennel and having to go into work.

Then we went to bed and slept late. After lunch, we went to the storage unit to get the china, and then came back and got ready for dinner. Mark, Lauren and Matt came over around 5pm and we ate. After dinner, we sat around and talked for a while. Lauren had made a really tasty fruit salad, made with oranges, plums and mint with a lime juice dressing.

It was a nice day, because it was so low-key and we got to spend it with family, friends, and cats in our own house.

Today the weather has been funny. Right now, it's hailing! It was raining before. We are going to go candlepin bowling.

Happy Thanksgiving, everyone!

Monday, November 24, 2008

Bail out Citigroup; What about GM?

OK, this article is not about Citigroup and the bailout announced today. I don't have an opinion on that. Well, I do, but not a strong one: I think the government should bail them out in return for full control, then split it up and sell off the parts. That's what the government should have done with AIG and that's what the government should probably do with Fredi and Fanny.

Currently, from what I read the bail out isn't a good idea. The government puts a huge amount of cash into an organization which is horribly managed and in returns gets grants to buy shares at 10 dollars, where the current share price is 3 dollars.

The real point I would like to make is for the people who ask "If the government bails out AIG, and Citigroup, and Whoever, why don't they bail out GM?".

The answer is, I think, fairly strait forward. If the government took any of the companies it is bailing out, it could divide and sell them. Most of the segments would make money. If the government took Ford, GM, or Chrysler and divided them (with the exception of GMAC) nothing would be worth a penny.

Lets get this strait: Chrysler was GIVEN to Cerberus Capitol by Daimler. Actually, Daimler paid Cerberus Capitol to TAKE Chrysler off their hands. So, next time a company pays money to give another company a segment of there business you know things aren't going well.

Ford just sold its last remaining valuable asset (30% of Mazda). GM, GM doesn't have anything except Hummer. They have been trying to give that away, no takers; no wonder.

Infact, the only way GM has been making money over the last few years is as a bank (essentially) via GMAC.

On the other hand, AIG, Citi, and even Lehman Bros were fairly profitable companies in areas where there was demand. Their problem(s) stem from a collapse of confidence, and bad loans. Some of their problems are bad loans, some is bad confidence. Take away the confidence and the bad loans might hurt these companies by about 20% of their market value. (plus other macroeconomic factors which are at play now). Government acquisition would just remove the confidence problem, breaking them up and selling them (maybe in a year or two) would probably be very profitable for the government.

Tuesday, November 18, 2008

The Automaker Bailout

It is a ridiculous idea to bail out "Detroit." Bailing out GM, Ford, or Chrysler is a horrendous idea. The fact that the government is bailing out someone doesn't mean that they should bail out everyone.

In the case of the three companies above, each one of them is insolvent, not because of the financial crisis, a crisis which is quickly passing (Banks are lending again), but because their business is rotten to the core. There are several fundamental reasons to not bail them out:

1) The government will never recover its money
2) The money will be squandered
3) It will not help employees
4) It will not help the rust belt economy
5) There are better ways to do all of the above
6) The automobile industry in the US will not collapse, nor will the parts market

First, we all understand that GM and Ford leadership are beyond hope. It appears Chrysler not so much (They got paid to "buy" Chrysler back from Dimeler). Giving money to any of these companies will put a good deal of the money into more products that Americans don't want to buy. It will also put money into share holders (who are just speculators at this point) and executives who will quickly leave to go somewhere else. These companies will go broke eventually, and when they do no one will want the parts.

Secondly, though there will be a large sort term shock to the economy, the demand for cars (while down) will not go away and will fully recover. Other automoile manufactures will pick up demand and they will produce the cars in the US. Toyta, Honda, Mazda all do, they do it because its cheaper and better to produce it here than ship them here. Theywill pick up the demand by producing more cars here, and buying more parts. No way around that. We won't go back to riding horses. American's laid off will get jobs back, though probably not in Michigan where the unions have ruined the state.

Finally, and most importantly, if the government wants to spend its money, it can put the money in a short term unemployement fund. As the "big" three go out of buisness the money can be given to the laidoff directly, and bypass the shareholders and executives (who clearly don't deserve it). This will be a short term solution, but so is giving the exectives and share holders the money to squander.

Plus letting the companies go under will finally clear the way for more efficient buisnesses to form and hire people. Its better to work for a proffitable company than a zombe. Trust me, it is.

Let the market work and take these ridiculus companies away. We will survive, and have nice cars to show for it.

Tuesday, November 11, 2008

New York, New York

We just got back from a 2-day trip to New York, NY. It was really fun. We took Amtrak in on Saturday afternoon, and came back to Boston yesterday evening. During our trip we walked across the Brooklyn Bridge:

And saw the great view:

And then we spent some time at the New York Transit Museum in Brooklyn, which is all about the New York City subway and bus lines. It was quite interesting and Jim was in heaven because he loves all things having to do with trains.

During our trip, we also got to see our friends Jessica and Dameion, who live in Queens. We ate at a tiny Turkish restaurant near Times Square called Turkish Cuisine. Not too original on the name, but the food was quite delicious.

We got back yesterday evening and I had today off for Veteran's Day. I made lemon bread. I think it came out pretty well. I used the 3 lemons I got off my lemon tree from this summer. It was nice because the recipe called for both the juice and the lemon rind. So I got to use up most of the whole lemon. I used a recipe from James Beard. I really like his zucchini bread recipe, and I'll bet this one is pretty good too.

I was going to blog about the morning sickness issue, maternity clothes, and pregnancy in general, but honestly? Why should I put that all in a public blog? I really need to go talk to my friends who have been through this, as I think it'll be more useful.

So I guess that's it for now.

Friday, November 7, 2008

Zack left Manchuria and went to Mauritania

I still don't know who he is.

Zack in Manchuria

Random thought:
I have no idea who Zack is.

Paper Part 2

Another good paper topic:

Durring the recent financial crisis several world currencies became very strong: The US Dollar and the Japanese Yen. The Pound and the Euro crashed. The reasion for the strengthening of the first two is obvious, a flight to saftey: people dumped currency of developing nations and bought "safe" currencies. Why didn't the same thing happen for the EUR and the GBP? Surely the UK is no closer to defaulting that Japan and the US? And surely the Euro will remain solvent, so why abandon the EURO? Some argument may be made for why people rushed to the dollar over the EUR: The US is an economic powerhouse of inginuity, we always come back strong.... but what about Japan? No track record...

A final paper topic:
As everyone fled the developing world and all their currencies crumbed, I bet there was one country (at least) that didn't see a complete pannic. Like maybe one country in a contanent, like Uraguay or something, that saw an appreciation of its currency. If I could find such a country, I would have a great paper.

Anyhow, off to NYC.

Monday, November 3, 2008

Some news

I think all 3 of you who read this blog already know this, but here's the news anyway:

We are expecting. A baby, that is. We are also expecting Obama to win, but that's a whole different topic. The baby, who we are calling Young Jebadiaeh for now, is due May 15. That won't be his/her real name. It's an alias. We will figure out his/her real name someday, but you probably won't hear about that until s/he is already born and named.

I will do next part interview-style, since these are the most common questions:

Are you going to find out the gender?
Probably. But I haven't decided if it will become public knowledge, mostly because I do not like gender stereotypes, and though they are unavoidable, the child does not need to have them before s/he is even born. Of course, I'm only avoiding it for a few months. (this is JK^2's argument to the contrary).

Where will the baby sleep?
Probably in the room that we are currently using for an office. This is because it has the least furniture, mostly. It allows us to continue to have a guest room for a while longer.

What color will you paint the room?
The room is currently a very nice yellow, and I think it'll stay that way.

Where are you having the baby?
Massachusetts General Hospital. So far, they have been fabulous. Let's hope the baby doesn't decide to be born during rush hour.

You didn't have the horrible morning sickness, did you?
I wish I could speak about it in the past tense, but unfortunately, it's still going strong. And we're going on 7 weeks of it now.

Will you move back to Buffalo now that you have a kid?

Will you go back to work?
Yes, but I'm still figuring out how we'll work that.

[I'll avoid the questions about "how could you go back to work?", etc. because I don't want to go off on a rant tonight about equal parenting, mental health, gender stereotypes, etc.]

How is your job taking it?
They are fabulously supportive, as they are for all family-based issues (this sounds sarcastic, but it's really not. They really are great. It's a big reason I've stuck with this job)

So I can't think of any other questions to answer except, of course, the most important question: how do you feel about it?
Excited, happy, scared, amazed, super sad that our dads didn't make it to meet our kid, optimistic ...

I have been quite happy. Really, the only thing that makes me sad is knowing that our child will never know what it's like to know my dad. And I think Jim feels the same way about his dad. We will tell him/her all about them, but how do you describe what it was like to laugh at one of my dad's corny jokes? And have him laugh with you? Or the comfort of coming home after a long drive from Boston and knowing he'd be in the back room waiting to hear about our trip? You can describe what a person was like, but there's no way of feeling how they were like. I miss my dad all the time and am really sad that our kids will never know him.

A question to leave you with for the night, since I'm not sure how to answer it yet:

Should we take a trip? A lot of people take a trip at around 5 months (I guess I'll be feeling better then). And if so, should it be a big exotic trip, ie., involving an international destination? I have mixed feelings. First, there's the money issue. This is on various levels. We lost some money in the stock market, and we're going to have a lot of expenses once the kid is here, and we need to keep paying for Jim's economics program. There's also the health issue. I need to avoid food poisoning, etc. We seem to always get a case of Montezuma's revenge (aka Pharaoh's revenge) every time we travel, with a few exceptions. Even when we were in Iceland, perhaps the cleanest place in the world, JK^2 ate something that did not agree with him. I am worried about this. But on the other hand, it may be a long time before we can go off on a trip like this again.

Of course, if the answer to the "let's take a trip" question is yes (and it would be nice to go), the next question is WHERE?

I will leave that thought with you tonight.

Sunday, November 2, 2008

Paper Time

I have to write a paper, I hate writing papers. I need a topic in International Finance. Here is one, but its harder than it may seem.

Everyone talks about the heavy debt burden the US has. Until recently most of the debt was held by Americans. That has recently changed, and now most (or at least half) of our debt is held internationally. So, now that there is a higher percentage of debt held by foreigners, does the probability of a sovereign default rise? In other words, is the US more likely to default on its debt now that the default will hurt foreigners more than it will *directly* hurt Americans?

Think of it this way, if you borrow from yourself, your debt situation isn't so bad. But if you borrow from someone else, you have much more to gain by defaulting.

Well, no worries, the US is no where near defaulting, but there is some probability, very low, and I wonder if it went up.

I am not going to study this much more. This is almost an impossible research topic. For one, the US risk of default is about zero, if not *actually* zero. Whats more, is there is nothing to compare the US to. Its the million pound elephant in a room of mice.

So I may look at much smaller countries. South America is the right place to look, SA keeps seeing sovereign defaults. Argentina has had about 5 since 1800 or so. Its still a hard topic, you need to tease out the %risk increase from Foreign debt vs the % risk increase from just more debt. I mean, countries may turn to foreign markets when domestic markets dry up. If thats true, the meer fact that the country aquired any foreign debt at all is a bad sign.

I think I need a new topic. I need to write a short paper in the next month (30 pages or so). There must be something easier... doubt it will be more interesting.

Saturday, November 1, 2008

Happy Halloween!

We had a fun Halloween this year. We picked out our pumpkins last weekend at the usual field in Cohasset that we've been going to for a number of years:

It was a beautiful, warm day. They had a lot of pumpkins, as usual.

We were going to carve up the pumpkins the night before Halloween, so they would be ready on the night of Halloween. But Jim had a midterm that night and we were both pretty tired from work. But that was OK because we both left work a little early yesterday, got home, and got those pumpkins carved before it got too dark:

By the time we lit them, it was dusk. It was a little windy but not as bad as some years. The candles stayed lit. One trick that we've learned over the years is that the best kind of candle to use are those "tea lights" that come in the disposable wrapping. So you just put it in, it burns down, and you don't have to worry about fishing the candle out later.

Strangely, there weren't that many kids this year, and no older kids. We don't know why. We usually go through several bags of candy, but this year we have a lot left over. More for us, I guess. :) (not necessarily a good thing ... maybe I'll bring it into work after all).

Today we went to the 3rd birthday party for the little boy next door, Tom. All the neighbors were invited and it was a lot of fun. They had a pirate theme. It's also interesting to look at other houses on your block and see how similar or different they are to your house. This house, for example, has the same exact banister as we do, and much of the same woodwork.

Tonight we're going bowling at Olindy's and out to dinner somewhere in Quincy. (We have to figure out where to go ... maybe somewhere new). The weather is supposed to be relatively warm, in the 50's, and sunny. A nice fall weekend.