The Economy

[papanasty]

I do'nt know if i should even get in to this but I am compelld to bring this up, I know that the economy in the states is in the TANK! Oil went over $100.00 a barrel today and probably is going to go higher, I am no economist or any were near one but i can see the writeing on the wall. We the people in Abaco are in i believe for a rude awakeing, our economy sad to say has been on a steady decline for the last 4 months, It is a tuff nut to swallow, construction is almost at a standstill here on Elbow Cay,there are a few houses being built but nothing really significant in the works, or to put it another way it's not bustling!

Since 1997 our economy has sustained fanominal growth to the point that we have become so used to haveing a back log of work as long as a year away in some cases,to wondering what it's going to be like in 6 months. With this being a election year in the US, and the state of the economy in the US,Amaricans, investors, forighners, what ever you want to call them are not spending money, they to are scared, It really is the topic of conversation around here,Every contractor i talk to feels the same way, the sad part about this is none of us no how to deal with it because we have become so use to more than we can do for the last 10 years.I have had more guys come looking for work in the last 3 months than in the all the years since 1997.

People critisize development complaining about intrusion of ther own little piece of parradise and how development is going to spoil there conception of what they have here and to a point i agree,we need to be more eviormentaly consious, we need eviormental control and initiate enviormental laws, but we also have to LIVE and take care of what is closest to us our FAMILYS! i Feel fortunate because i have some work that hopefully will carry me and my family and my employees through what i see as tuff times, it would devastate me to tell a employee that i have to lay you off because of lack of work,they have worked for me for so long there like family and hopefully that will never happen.

One of my main concerns is how long do any of you think this trend will last, One thing i want to stress on is the baggering of our foreighners, I hope i speak for all Abaconians and that is we welcome you all with open arms and hope you will continue to invest in our future, because as i see it you are our FUTURE! I believe these are hard facts but they need to be discussed to come to a compromise or at least show our concern with our investors and American and all other nationalitys that might want to invest in our island of choise that we want you here.

I do agree with SGCR that these large scale developments are not in the best interest of the enviorment, But we can not survive financialy or provide for our familys econmicaly with out development and some of those so called anchor projects,those are the cold hard facts so were is the perfect balance, WHAT is it going to take and how long will it be before we all feel comfortable again,secure again, confident again, because the sentiment around Elbow Cay is not one of jubilation. There has even been speculation of land priceing dropping to try to stir the pot so to speak hopeing it will encourage some economic value.

I have brought this up because i know there are a lot of brite minds out there that are concerned about our welfare as well and your suggestions and input would be welcomed thank you for allowing me to vent this frustration that i am feeling for all the great people of Abaco and forighners that have in the past given us so much Respectfully Papanasty:confused:

[Long Look]

I think this is a tough issue for everyone... I'm a motorola stock holder :(
It really seems that everything is for sale in Abaco. I don't know if this is a result of previous speculation on real estate, and over the past years people have been trying to get out with a profit, or if this is a result of Americans losing value in their 1st home, and needing the extra cash to pay off the mortgage / lost stock value, but that certainly doesn't boost confidence.
I feel that one issue that the Abaco economy has is a huge disparity in housing prices.
The fisheries issues have not helped either.
And with current gas prices a trip to Marsh for work has to be munching away a good portion of the paycheck.

There is no easy answer to any of these issues.

[Abacoparrott]

I just spoke with a friend yesterday. He is in the entertainment business in Myrtle Beach, SC. He said that the numbers of people vacationing there now is WAY DOWN from the same month a year ago. Apparently, this is widespread.

As for Abaco, I have long stated that I think the people of Abaco is it's biggest tourist asset. They are intelligent, efficient, and in tune as to the needs of tourists. It's the government (both bahamian and US) that has irked me at times. Some of their moves and decisions indicate to me that they think that Americans have an endless supply of "green" in their pockets........this is simply not true.....everyone has their limits. Let's all hope that this economic slowdown is relatively temporary and that we'll get back to "business as usual"........Ken

[DrRalph]

Last fall my wife opened a hair salon here in Ormond Beach. She leased an empty shell, then had the various tradespeople come in and do the finish work. It only took a few weeks. Most of them told us they are standing around, waiting for business. We called a plumber twice, they were there in ten minutes. The electricians sat in the parking lot for two days, just waiting for another call.

There are big commercial lots on the beach, places where old motels were damaged in the hurricanes of '04, someone bought the land, then ran out of money and couldn't build. They're just sitting there growing weeds.

When oil hit $95 the first time, I liquidated almost half of my 401-k, took the profits, and I'm just sitting on it; what can you buy with confidence?

This is going to be a tough stretch for the building trades and hospitality industry. Our numbers are down here as well. I'm no economist, but I think we're in the tank for a few years.:(

[vharrison]

Dr. Ralph, thanks for paragraphing Pap's post.

You can buy Exxon stock with confidence. :p

[sail pending]

My days of zipping to and from Abaco are on hold. In '05 I made 6 trips on Vintage air and 2 by boat. Four people on Vintage (round trip) is up to around $1100 when it's all said and done and the last trip we did by boat (7-07) was our last for a while. We have taken two center consoles every summer on a 300 mile run from Daytona to GTC to meet lots of friends who fly in. It's always a great Abaco time and it keeps getting more and more expensive from the price of fuel to cruising permits to rental homes. After looking at our receipts this year we booked a huge private home on a private island in the Keys and we are working on half the budget.
Sooner or later something is going to have to give. It's not just us little center console players who are looking for alternatives it is the big Sportfish boys with private jets too.

I'm hoping that things get more reasonable or I come into a whole bunch of cash so that I can resume my love affair with Abaco.

[patw]

http://www.jonesbahamas.com/?c=47&a=15881

[Marty]

I'm not an expert, but have an educated opinion since I work in finance and indirectly in the mortgage market in the US.

The economy is in the tank and will continue at least into the 1st quarter of 2009. The main driver behind that (but not the only one) is the housing crash. The bottom is falling out, but we have not hit bottom yet. I believe that will happen in the next 4-6 months. And it will take another year after that for the market to reasonably recover. The ripple effect from that is devastating to some communities and markets. Spending is way down on many things, especially "luxury" and big ticket items which includes vacations, automobiles, and second homes. This is where the global impact will be felt. Imports should go down. People will be buying fewer new cars and other imported (and domestic) goods. Spending on travel will go down. Hotels, rental companies, second home owners who rent, restaurants, etc. in tourist areas will be impacted. The domino effect is almost endless. Those of us smart enough not to stretch beyond our means and stable enough financially and professionaly (i.e. secure job) should be fine. It's going to be a rough year or so.

The election year posturing and spouting will do little to really help anyone in the short or long term. I'll leave my reasoning out of it. [I don't want this thread to get political. Please no one go there.] I really don't appreciate the government bailing out anyone who made a bad choice on a home purchase or loan. You made the mistake, you pay the price. Anyone want to pay my mortgage? Didn't think so. For the record, I also don't like the idea of the Fed bailing out the stock market. If it's supposed to be a free market, let it be. If the market crashes, so be it. It'll come back - with smarter decisions and correct pricing.

The price of oil is an enigma to me. Some blame it on developing countries, mainly China, and some blame it on "price gouging" by OPEC and big oil companies. I believe it has a lot to do with pure speculation in the commodities markets driven by silly announcements and news stories. With demand gradually increasing and supply remaining relatively steady, there is no logical reason why the price per barrel has doubled in a little over a year. Can anyone explain Exxon's (and other big oil company's) repeated record profits?

I think that's enough for now. Thanks for letting me vent. Sorry for being so long winded.

[SusieAndAl]

First, the bad news:

1) Best estimates for 2008 GDP growth is 1.2 - 2.0% US; 2.5 - 2.8% EU; 6 - 8% China and India; 80 - 100% oil-producing countries excluding Iraq and Iran. So while technically the US won't likely be in a recession, any growth rate decline is bad and the mortgage mess looks like it will last for at least two more years.

2) The price of oil coupled with the current Bahamian tax structure is really hurting the average Bahamian and local businesses. Electricity costs are skyrocketing because of the total reliance on imported diesel. This is exacerbated by the 17% tax charged by the government on a per barrel basis. Interestingly, Mr Laing stated that the government has no intention of capping the tax even though there is no mention of $100/barrel oil in the budget. Thus, this windfall goes into government coffers and aggravates the price increases.

All prices for staples are rapidly escalating because transportation costs are rising, and again the tax policy multiplies this effect (if you ship stuff in, you are charged for the value of the goods, PLUS another tax on the total landed cost including transportation).

3) The State of Florida is considering eliminating the 6% tax on exported goods. If this happens, prices will immediately go up even higher again because of the multiplier effect of the tax structure.

4) The lobster season looks bad; even worse than last year.

5) The Freeport saga continues, but there is reason to believe that the impasse may be broken. (This is crucial for all The Bahamas including Abaco because a thriving, efficient Freeport directly translates into total cost of living here).

Now the good news (or at least reason for hope):

1) The MHH airport project is proceeding. This should drastically cut airfare prices from the States and dramatically lift capacity with a corresponding increase in tourist arrivals and investments.

2) BEC is actually embracing the notion of alternative energy sources. Reverse metering looks like a reality soon and a license for biodiesel production in Nassau should be approved shortly.

3) BTC was finally forced to interconnect with Indigo so cell phone costs should go down. It also looks like the government is serious about privatizing BTC.

4) Baha Mar and Albany got approvals, so construction on Paradise should pick up substantially. (We won't comment on BB).

The bottom line is that an already high cost country will see more disproportionate cost increases for at least the next several years coupled with tourism declines. Very high end development should continue, but lesser projects will likely decline further for the next several years.

Abaco will likely fare better than her sister islands, but this is relative. If we were running a business here we would assume flat to slightly down economic activity for the next two years using this month as the baseline, with 5-7% growth 2010/2011 and true cost increases averaging 8-10% per annum.

We also think the best long term opportunities are on the main island to the south.

This is a beautiful, wonderful place that should thrive over the long term as long as environmentally sensitive, smaller developments, the airport, a restructured tax schema and a sensible national energy policy are in place. We truly believe all can and will be done, but will take time.

Cheers -- SusiaAndAl

[South Pause]

Thanks for a very informative and well written post.
I totally concur with you on all of your points.

[Marty]

SusieandAl, thank you very much for the local perspective. Great info.

[SamFamAustin]

Excellent postings here, good job. I'm still learning, and have this sinister feeling that I've "been there and done that" when I am reminded of stagflation of the 70's or the mini-recessions of the 80's. Some more random notes from Sammy's computer:


To Marty, crude oil has been going up because the dollar is going down, so if the dollar was held constant over time it probably is worth about $50 a barrel - but because if the dollar is worth less, you pay with more of 'em.
There is little the US Congress and Fed can do to really control the situation, since lowering interest rates makes the dollar cheaper and causes inflation, bummer. Natch on the tax rebate thing.
The bad part is that is consumers (70% of the US economy, bigger than Wall Street) think it is a recession, it is, and the concept is self re-enforcing.
Recreational boating is really taking it on the chin, between rising fuel and insurance costs - and lack of cheap marina space. Talking about marinas, one gut down here in Texas said we was paying over $12,000 a year just in liability for only about 20 boat slips; he decided to "condo-ize" the marina with prices starting at $150,000 per slip.
Some traditional tourist places are going tolerably OK but we're seeing more local visitors doing short stays, mostly coming from with 300 miles or a day's drive. Down here there is a concern that Spring Break might not even happen this year. Maybe their allowance ran out?
During a recession, alcohol sales and bar booze sales actually go up.Like I say, it was sorta random. :eek:

[donjoy]

PapaNasty. From your post, you must be a contractor. Your main concern seems to be the slowdown in construction. I think you need to consider that the development has to stop somewhere. There's a finite amount of land to be developed, and it has to "run out" sometime. It's unfortunate that this will cost some folks their current livelyhood, but people move on and learn to do other things. It just isn't fun. We just might be at the point where the supply of construction skills has exceeded the demand.
I wish you luck and hope that all works out well for you.
Don

[Patti Puzo]

SusieandAl,
Well done, and I appreciate the time it took to post.
Thank you...

[Marty]

Sammie, I partially agree with you. But the weakness of the dollar can't fully explain the price per barrel going from less than $70 in Sep to over $100 now. The dollar has actually been trying to hold it's own or recover very slightly recently. Why is it that the price goes up right before the "summer driving months" and right before the "winter heating crunch"? Yes, pure demand drives some of it, but it is also (I think) speculative (or call it anticipatory) pricing. Did I just make up a new word?? :rolleyes: And, yes, bar and booze sales go up. Unfortunately, people drink more when they're depressed.

donjoy, I also partially agree with you. But contractors can also do repairs, additions, handyman stuff. There will always be a need for that even when "fully built", especially with the ever-present threat of whirlygigs every season. Yes, there will be a significant decline in activity, but activity will still be there for those hardy enough to weather the storm (pun intended :D ) and remain. From what I've heard, papanasty is broadbased (no pun intended ;) ) and resourceful enough to keep himself and his company busy.

[Charlotte Couple]

Supply and Demand is part of it, particularly why gas prices rise before peak driving seasons, but I believe the biggest cause of the increase is pricing by the oil-producing nations. For them, there will eventually be no more oil under their soil, so they maximize what they can get for it now, particularly in the Middle East. Venezuela charges its citizens pennies for gas, but their exported oil goes at the world market rate.

The price per barrel is the cost of crude oil that the big US oil companies are BUYING, not selling. Yes, they've made record profits, but compare their ROE or ROI to those of other industries, and you may be surprised.

[SamFamAustin]

Well maybe a little more on gasoline and diesel is needed because international currency doesn't fully explain it, and a major cost of vacationing is paying for all that gas, even if you fly on an airplane.

One escalator was the new clean air rules that required reformulated gasoline and diesel, as well as additives such as ethanol for gasoline (cheap MTBE replaced by expensive alcohol). Summer fuel formulations are cleaner than winter ones, as well, which creates seasonal bottlenecks. So even if "regular" or non-reformulated fuels are imported into the Bahamas, the refineries had to charge a bunch for billions in reconfiguring their refineries for low sulfur fuels using crude feedstocks with higher sulfur content, etc.

Another is one you well know, the "terrorist tax" in conjunction with tight supplies. So if one rig off Nigeria is attacked, or one refinery in West Texas blows up, prices move upwards in a dramatic fashion, based only on market fear. Rumor is that one market trader in Houston only uses a telephone and a pair of binoculars, watching for refineries to explode. But the terror tax is even higher, and the military is using millions of gallon an hour just in Iraq.

An interesting topic is the effect of supply and demand, with India and China being the focus for increased demand for crude oil and its products. I certainly don't know everything but my understanding is that global demand for crude is actually going down due to a recession in the US, and OPEC is actually thinking of cutting back on production - simply because they've filled up all their tanks. When Americans buy less, that means less imports to the US on ships, trucks, airplanes, and railroads.

So maybe there's some truth to that, demand going down but like stagflation, the prices going up. No easy fixes are there that I can tell, and opening up northern Alaska for drilling is not a panacea by any means.

What does all this mean for the Bahamians? Well, since most of the power in remote areas is from diesel generators, so prices will definitely continue to surge. I'd build me a windmill because from what I heard it's windy as the Dickens lately.
/sammie

[Rock Steady]

...thanks Susie and Al. I don't know much...but I'm growing gardens all over this property and eating what I catch.

rs

[oldoc2]

As I read this whole discussion, remarkably free of political rancor, it seems that you all are saying much the same thing. The US is in real financial trouble-the middle-class is suffering most. Clearly that and the price of fuel will hurt our beloved Abacos as what is a world-wide problem seeks slow solutions that will leave many permanently hurt. Those of us who can should and will continue to come and enjoy-hoping that those who can not will soon be able to rejoin.-my thoughs for a cold, soon to be snowy New York. I haven't even mentioned what this is doing to healthcare but that's another long story.

[SamFamAustin]

Good point that if you can get a cheap flight to Florida and a cottage or room that isn't too expensive, the Abacos really isn't all that bad on the purse. Sure, I've heard about folks blowing way over five grand in a week, but on a budget it can ... and should ... be done. If you think things are a little more developed than ten years ago, well just wait ten years from now!

Compare Abaco to the Mexico border towns today, which more resemble a militarized DMZ with absolutely no tourists. Those folks are hurting. Some of my buddies went to Garcia's over in Matamoros and were the only people in a restaurant that can hold hundreds of people. If you can hold your nose while getting through all the stinky airports with all their "security," the Abacos is a cake walk by comparison.

As we used to say in the Disco Days, "do it man, do it, just do it."
/sammie

[Stone Malone]

there is nothing new here. Abaco's history is full of boom and bust times. I am not implying that our tourism and second home owner industries are going to "bust" but if we are in for a downturn, we'll weather it. I personally think that we in Abaco and especially the cays are not going to feel as big of a pinch as some other parts of the country might. We'll be ok.

[Spagna]

Pappa, You asked a question, the following is my thought and believe me I can empathize with your situation. My family was in the residential home construction business for 2 generations before me and I was in it with them for 12 years. The business was started by my grandfather who came to the USA from southern Italy in 1895 age 21. He had a net worth (in today's Dollars) of $3 million by 1929 and he lost it all! He started again and by the time I was a teen-ager the family was driving Caddy's and Lincolns and living in 3,000+ sq ft houses. We saw this same kind of 'recession' many times just within my lifetime. They usually last about 3 years +/- from start to finish. As Jimmy Cagney said in the movie '1-2-3' "Remember...it's serious but not hopeless!" This time around there are some big reasons like oil prices (it is a combination of everything said above) the 'sub-prime mortgages' (idiots on both ends of the stick) and the recurring attitude of 'limit-less-ness' (nothing lasts for ever). How do we cope with the down times? it depends on the individual and what you want. I spent most of my 30 year career (and my wife as well) as a computer 'consultant'. That is self employed, no benefits just hourly salary.

First of all we went where the money was!! We started working in NJ then NY then PA then NC then GA then FL then MI then MO then IL then CA then NC again!!!!!! I would have preferred to stay in one place but making the money was more important than where. Secondly, we didn't buy everything our income could be stretched to buy. We bought houses that were half the price that our friends were buying and cars that were less expensive and keeping them longer. By keeping a lower profile we were able to put aside money for the times of no contracts for whatever reason, pay off 26 acres in the mountains, buy a cruising sailboat (we'll be in Abaco in November..hope to see you then!) and put our son through private schools his whole 16 years. As A friend of mine from IBM said 'It's not how much you make that counts it's the burn rate...how you spend it."

[Hank g]

The advice given in "The Graduate" might have been forward-looking at the time, but I'd rather have a wooden boat anytime.

Except for the Abacos, we all live in a plastic world.

For Crispin - Mutton matters!

[Floridacargocat]

Re Posting by SusieandAl
"Now the good news (or at least reason for hope):

1) The MHH airport project is proceeding. This should drastically cut airfare prices from the States and dramatically lift capacity with a corresponding increase in tourist arrivals and investments."

Please correct me if I am wrong. Improvements at MHH consist of improved passenger facilities, new taxiway(?), and tower. Very good.
The proposed runway lengthening has been put on hold.

As much as it could/would be an incentive to lower air fares for flights between Florida and MHH, this requires larger aircraft. TCB has a longer runway than MHH, which could accept aircraft of the B737/A319-320 type (maybe a 757), but does TCB have the passenger facilities to accept >130 pax at a time? But it needs more like instrument approach procedures, of which there are none (currently) in The Abacos. Landing is based on Visual Flight Rules (VFR)only, and the operators of "larger aircraft engaged in commercial operations" might not be authorised to land under VFR rules.
Furthermore I do not see a decline in aircraft fuel prices, on the contrary.

Economy on The Abacos is based on tourism. There is no banking, gambling or larger-scale agricultural/fishing industry having a major economical impact. No diversification. Whatever affects a tourist's decision regarding a specific destination will have an effect on the economy of the Abacos.
Once Cuba opens up, tourists will have an option/alternative due to proximity. One of the positive sides of The Abacos is that you will communicate in English. If you are bilingual (English/Spanish), then it will become a tough decision. Deciding factors will be, among others, service, hospitality, value of the product compared to other destinations.

To put the initial posting into proper context, I was personally affected by the closure of Walker's Cay. If you are close to the ground, and have the necessary connections to this small group of Northern Abacos islands, you will realize the economical impact of this event, enhanced by the consequences of the difficulties in the Freeport hotel industry. Freeport will recover sooner or later. For the other islands it might take a little bit longer.

[Patty&Rudi]

[QUOTE=DrRalph;23354]
When oil hit $95 the first time, I liquidated almost half of my 401-k, took the profits, and I'm just sitting on it; what can you buy with confidence?

Bill Gates owns the controlling interest in silver - and that is worth having, with confidence. And some gold. I think 25% of your extra money is supposed to be in silver (more) and gold (less).

And - we teach our students to invest in themselves FIRST:
Own your home(s) and have no mortgage.
Be debt-free.
Invest in your health.

Beyond that - it's a crapshoot, but playing the stock market is suicidal. It pushed my mom over the edge in 2002. She was sick, probably dying then, but she'd watch CNN and cry that she'd lost $40,000 that day, or $30,000 the next. She didn't care that it was on paper - and that it wasn't over 'til it was over.

I am an only child, so that headache became mine - and the first thing I did was liquidate. I have slept great since.

[vharrison]

Patti, I agree with you on owning gold and silver. If nothing else, what about a tax free bond, that is safe. Bottom line, you want that money earning something.

[Abacoparrott]

The gas part of this equation was within our power a number of years ago to prevent this from happening to our supply. I cannot go into it further here cuz Ralph considers it too political. While I do not consider it political, I will respect his wishes. If anyone would like to email me.... parrochie@aol.com

Other than that, ALL countries seem to be taxing their citizenry to the breaking point......in one way or the other, effectively taking the dollars out of the very people's hands (the consumers) that can get us out of the slump. Does anyone know of ANY government that can be as efficient with your dollars as YOU are?? Good thread folks....I am enjoying hearing your various opinions...Ken

[Beer Baron]

After reading the posts above, I find I agree with most of them. As a realtor in the Northeast, I am watching price reduction after price reduction and more and more properties are going onto the market at prices that would have lasted less than an hour in 2004. They're just sitting there.

It's been tough in real estate for at least a year and a half and there's no light at the end of the tunnell yet. It's gotten so bad here that I've stopped telling people at parties that I'm a realtor (something I used to do all the time when things were good to try and drum up more business). I just can't stand the negativity it seems to generate in certain circles of seemingly polite society. I've had conversations with CEO's turn seriously nasty just because they had the misfortune to find a realtor whose ink was still wet on their license screw up the transaction royally because their only answer for a declining market was to overvalue the home to get the listing contract and then keep reducing the price once a month until it sold!

I agree that there are those of us who were drunk on the power of low rates and rising home prices for far too long, and the pendulum HAD to swing back the other way eventually. But it's depressing to watch people who are just barely staying afloat have their mortgage adjust to an impossible monthly payment then have to decide between bankruptcy or foreclosure in order to survive.

I believe that much of the blame lies within the subprime mortgage market. They were giving out loans to people who never should have gotten them like they were candy. Then they cried to the government when they got burned by the inevitable foreclosures. Since it happened all at once after the junk ARM loans they were writing all adjusted, we're in a seriously bad situation all arounf the housing industry. Unfortunately, the housing industry was what was driving the GDP so high for so long and now we're all looking at the horizon and seeing some ugly storm clouds.

Since people here in the US are tightening their belts for the recession which I am convinced has already begun, there is little money left over for tourism. As the financial infrastructure of the Abacos is built on foreign money flowing in, this does not bode well for them either.

[Patty&Rudi]

We generally have a little upward blip before any presidential election - so maybe that is worth looking forward to in the US.

On Elbow - our realtor told us that nothing has slowed down in the least, that sales are as brisk as ever and prices are staying high. Is that realtor talk, or reality?

I do know that the house we'd put in an offer on last year, which had been on the market a while before that, has just gotten a contract for sale this week (days before we were headed back to look at it again). I don't know how close it was to their asking price though.

Rudi's post-grad degrees are in the history of economics, and he wrote part of NAFTA (before he realized it would lead to spp.gov) and was the Canadian rep to the GATT.

He just bought a bunch of Euros. Basically he says - don't live past your means, pay off all debts, cut down discretionary expenses, and if you can put money into gold, silver or the Euro or other currencies (not doing it to make money, but to protect yourself) - good.

The general objective in a recession is to survive, and therefore have as large a cushion of savings as possible or as little debt as possible.

As the IBM guy said - it isn't how much you earn, it is how much you burn (Dickens said in Great Expectations). If you are spending more than you are making, it doesn't matter what level your earnings are - you are in debt.

And the recession will last 1-2 years, if not longer this time, so it is a matter of getting back to basics. Then when you spend - spend on things that have value. If you value a holiday in the Abacos then you economize on other things at home, like eating out or going to theatre, and then spend the money on what you really value.

We'd rather give up a lot of things we might do here, so we can spend time in the Abacos, and what we give up doesn't matter that much when we look at our priorities.

[DrRalph]

Patti, I agree with you on owning gold and silver. If nothing else, what about a tax free bond, that is safe. Bottom line, you want that money earning something.

Except that they are both at all-time highs, along with several other semi-precious metals. Scary time to buy!:eek:

[SamFamAustin]

Sure luv to hear your thoughts about the "fuelish" issue and I think you have my email, Ken. So no Flame-a-Palooza today?

One article I saw was that the golf industry was taking it real hard these days, which you don't see on the sports pages about Tiger Woods ... but apparently over 6,000 were built in the last few years in the US as less and less people played golf. Right now over 600 golf courses are for sale, mostly in Florida. The tourist experts are baffled, and are trying to lure fresh members with 6-hole golf and beer parties on the 18th hole. That's about when the nekkid golfers started showing up, by the way. The local residents were not pleased ... golf, the bad boy of the sporting world. :eek:

I still think the Abacos still can reap a bunch of revenue from the fishing tournaments. No idea about the numbers but I have heard there was some bad press over the last year or so due to cruise permits, fishing regulations, and fish cop stories. To me it is strange to limit the best parts of the economy since these folks bring tons of money over. If you think about it, most of the pelagic fish like marlin and wahoo are not even native fish but travel many miles ... I think tuna have been tracked from the US Gulf all the way to Spain and back. I guess many of you know what happened when we tried to have a non-tournament fishing tournament, no dice.

Well Papa asked about some good ideas to help locally ... certain things like promoting what you have and maybe diversifying into computers, clean electric power, and education would be a good strategy. Reduction in stiff tariffs could definitely help. As noted very well above, the building trade rides up and down like a boat in the waves, and one day the boom will return - the population is growing at 2-3 percent in the US and that should do the trick. /sam

[Beer Baron]

Sammie - We had one of them thar nekkid golf parties up my way last summer. Pretty wild stuff! Several exotic dancers had some 'splainin' to do afterward when they found they had been caught with their pants down... no pun inte- no wait, that was a pun

[Abacoparrott]

Sammie, the golf course sale thang is going on all over the country.....but not because of lack of golfers.......in fact, most good courses are pretty busy. The sales are mostly not private clubs but public clubs.....the land is becoming MUCH more valuable as a housing development as opposed to a golf course. I'm afraid that open-to-the-public courses (especially those with no homes on them) will slowly go by the wayside in years to come. Most all new course construction will be attached to a development with golf course lots.....some private, some semi-private.

I will email you on the other subject tomorrow.....ken

[SamFamAustin]

Sounds like a normal day of fishin' ta me, Beer Baron. At least fishing I don't have to embarrass myself because my my slice is too good and my putter game ain't. For similar reasons, they don't allow me to go bowling, either. At least fishing I can act cool and not do any real work except if I actually manage catch a pipefish or something.

Oh just saw yer message there about the golf situation, Parrot-Mon. That was another one of them real estate bubble-makers as well, although the golf courses did tend to bring in the affluent folks instead of the marginal home buyers of the middle class. It is all about the land and how much you can get in what location. The land itself can't be worth more than $50K but people pay outrageous amounts for the right location. Right now I have a $205K beach lot with a $250K view of the bay - they threw the nice old old beach shack fer free. Not five years ago, the exact same place was $90K. So you tell me what's wrong with this economy ... it wasn't just mortgage sub-prime and all that hooey ... a gasket had to blow out somewhere and it looks like both ends this time.
-sammie

[Marty]

I briefly did a spat in the golf course management business a few years back. Golf courses are not by any stretch of the imagination cash cows. One has to really bust thier arse and put a lot of sweat and money into it to make a decent buck. The main driver in a golf course is revenue. The main way to drive revenue is rounds. The biggest obstacle became competition. It became very chic to own a golf course or a piece of one. During the tech boom with money flying everywhere and the economy chugging along, many new courses were built or existing ones changed hands. I was in Myrtle Beach several years ago talking to a bunch of course managers. They threw around a bunch of stats on golf course construction in the last several years (late 90's early 00's). Rounds per course went down. Duh. In the last several years (2002-2007) many courses, 12-14 I believe, have been closed and are being redeveloped as sub-divisions, houses only. Now, rounds per course are going back up. Bottom line is, the golf business, at least in the Grand Strand area, is not doing that bad, comparatively speaking. (This is different from the summer vacation business.) The only problem with redevelopment is that the housing market is in the tank now. It's a double whammy. The people/companies that speculated on the property when the housing market was in full boom, are now getting a little singed. Pile on top of that the fact that there is a very large portion of MB owners that are second-home owners and are now liquidating or not buying.

As said in earlier posts, the economic problems in the US will have a similar or domino effect on Abaco. Tourism will slow, second home owners will sell or not buy at all. This will have a ripple effect on all tourism related businesses from liquor stores, grocery stores, restaurants, boat rentals, dive shops, iggy biggy type stores, marinas, the list goes on. The local Bahamians that work at those stores will be impacted with lost wages/revenue.

The small bright side barely worth mentioning (no disrespect at all intended to Europeans here) is the weakness of the dollar to some extent. This makes it cheaper for Europeans to travel here since the Bahamian dollar is pegged to the US dollar. Since the vast majority (I think) of Bahamian visitors come from the US, this will be a minimal impact.

These are the rantings of a tired and sick (as in with a cold!!) individual. They are not meant to be preachings or absolutes. Take them with the leftover grains of salt from the tequila shot.....

Thank you. Good night!

[trubahamian]

[quote=Marty;23377]Sammie, I partially agree with you. But the weakness of the dollar can't fully explain the price per barrel going from less than $70 in Sep to over $100 now. The dollar has actually been trying to hold it's own or recover very slightly recently. Why is it that the price goes up right before the "summer driving months" and right before the "winter heating crunch"? Yes, pure demand drives some of it, but it is also (I think) speculative (or call it anticipatory) pricing. Did I just make up a new word?? :rolleyes: And, yes, bar and booze sales go up. Unfortunately, people drink more when they're depressed.


Energy and oil in particular should not be allowed to be traded on the future's market.Oil is artificially inflated at every oppurtunity and the worldwide users of it pay for it on the chin because of greedy speculators!

[Spagna]

According to an article in a recent 'Soundings' boating magazine , there are 8 million 'Middle Class Millionaires' that is people whose NET worth is between $1 and $10 million in the USA. They are still buying large yachts in Ft. Lauderdale and second homes in the mountains of NC and probably those homes on Elbow and else where. Targeting that market is the only profitable one in real estate or boating or tourism right now. For the rest of us getting out and staying out of any debt is the only thing we can control ourselves. Careful planning with a financial professional will help make the most of the stock market but you have to be in it for the mid to long term, you can't watch it day to day. Sure our account statements show we lost some money in the last 3 months but over the past year we made our budget, we made 'enough' and 'enough' is all I need. And it is too late to buy precious metals now but when things get better they will go down in price and it is then to remember to buy some for the next downturn and there WILL be another downturn and another. It's the way it is.

[SamFamAustin]

Good point and to Tru -

I don't really know if the commodity traders on the futures market totally influence things too much, other than pushing a few pennies here and there. Here's some facts from the DOE website:
60-70% of the cost of gasoline or diesel is buying the crude
in November 2007 the US produced 150 million barrels
at the same time we imported 300 million barrels
Alaska only shipped 22 million barrels to the lower 40 statesAny single number is highly misleading because each exporting country (market) to the US regulates its price ... for example, the blend of prices may have been slightly over $100 per barrel but Canada and Mexico was trading at $88-89. Obviously, the traders at NYMEX can't control what Canada and Mexico sell their oil for, right? The problem is that America lost control over its ability to control crude prices because of a long history of fragmented regional markets that simply can't be controlled or manipulated. Much of the price of gas and diesel, besides 13-20% taxes (US and state, maybe more in the Bahamas), is from price pressure on oil extraction itself:
most of the sweet, low-sulfur oil has already been pumped
remaining reserves are very deep or very high sulfur
poor planning resulted in contaminated oil fields
rig costs have been dramatically escalating
many fields have been nationalized and not owned by Big OilIf there is a smoking gun I haven't found it. Futures traders, OPEC, and large companies such as Exxon-Mobil do not seem capable of gaming the system by themselves. I've checked out the hedge funds, which were a likely candidate, but most of them have gotten out of the crude oil market (they went into coal, ethanol, and wind). Frankly, I'm dumbfounded!
-sammie

[Patty&Rudi]

Except that they are both at all-time highs, along with several other semi-precious metals. Scary time to buy!:eek:

V - I don't know a lot about bonds... but I would worry if they were fixed to the US currency, in case that disappears or changes.

And Dr. Ralph - I'd watch the silver in particular and pick a price that you think might be reasonable (being reasonable yourself) and then when it dips - jump in. And don't do it with paper gold or virtual money - we once put $5000 into e-gold, online. One day Rudi went into the account, and it was gone - poof. The company said he must have told someone his password (which he hadn't - I didn't even know it). Nothing we could do!

[Patty&Rudi]

Anyone know how many barrels of oil provided by Canada, from the Athabasca tar sands in Alberta?
I think it is a sizable about.

Sammie's numbers add up to 472 million barrels from imports and Alaska - 172 produced more locally - but what does Canada contribute?

Just curious. I may go google that.

Okay, Canada has 179 billion barrels in reserve.
2.7 million barrels per day - 985.5 million a year - is that right?
182 years worth.

So where is it all going?

[Patty&Rudi]

And sorry for this little correction - Rudi's degrees are in Economics, and also the Philosophy of History!
So he is interesting on vacations!

[SamFamAustin]

Dunno, Canada is the largest exporter to the US at about 1.9 million barrels a day. Saudi Arabia, Venezuela, Mexico, and Nigeria come about 1.0 to 1.5 million a day each.

My understanding of the Canadian tar sands is that it is "blow and go" with many companies such as Shell investing heavily. Above $70 per barrel it makes sense, although the most destructive kind of oil extraction in the world (what were they thinking?). If the hydrocarbon market tanks, and it call fall to $35 on a whim, the tar sands would be out of the picture for a while.

Here's a toast to hoping so!
-sammie

[islandfever]

You are so right Dr. Ralph. I remember when the Hunt Brothers tried to corner the market on silver in the early 80's. A friend mortgaged his house and borrowed every penney he could to buy silver when it was near its peak. When it crashed, he lost his business, home, and family. I had rather sleep at night.

[ScottB]

[FONT=Arial][SIZE=3]This thread reflects the various views and conclusions of much media reporting, for sure

[H2Os]

This showed up recently in the NYTimes re the loss of golfers...interesting

http://www.nytimes.com/2008/02/21/nyregion/21golf.html?_r=1&scp=3&sq=golf&st=nyt&oref=slogin

Hopefully the link will work. But the bottom line the golf course owners said was that men can't take the time to play 18 anymore.

[Patty&Rudi]

Dunno, Canada is the largest exporter to the US at about 1.9 million barrels a day. Saudi Arabia, Venezuela, Mexico, and Nigeria come about 1.0 to 1.5 million a day each.

My understanding of the Canadian tar sands is that it is "blow and go" with many companies such as Shell investing heavily. Above $70 per barrel it makes sense, although the most destructive kind of oil extraction in the world (what were they thinking?). If the hydrocarbon market tanks, and it call fall to $35 on a whim, the tar sands would be out of the picture for a while.

Here's a toast to hoping so!
-sammie

There would go Alberta, and Calgary and other cities, which are similar to old west boom towns at this point! They pay $15 an hour at Starbucks to start and still can't get help. If anyone needs a job, that's the place to be at the moment.

My ex flew for Sun Oil, and they were dredging up the tar sands. Still are. Many of our patients work "in the oil patch" and are very comfortable financially.

[tim abbott]

Hi SamFam,

Referring to your post #12 way back on page 1. I think one thing congress could do to not add fuel to the fire is not spend humongous amounts of money greater than the governments income by borrowing. The same thing as we are constantly told not to do by financial counselors. Just my opinion.

Tim Abbott

[trubahamian]

Good point and to Tru -

I don't really know if the commodity traders on the futures market totally influence things too much, other than pushing a few pennies here and there. Here's some facts from the DOE website:

60-70% of the cost of gasoline or diesel is buying the crude
in November 2007 the US produced 150 million barrels
at the same time we imported 300 million barrels
Alaska only shipped 22 million barrels to the lower 40 statesAny single number is highly misleading because each exporting country (market) to the US regulates its price ... for example, the blend of prices may have been slightly over $100 per barrel but Canada and Mexico was trading at $88-89. Obviously, the traders at NYMEX can't control what Canada and Mexico sell their oil for, right? The problem is that America lost control over its ability to control crude prices because of a long history of fragmented regional markets that simply can't be controlled or manipulated. Much of the price of gas and diesel, besides 13-20% taxes (US and state, maybe more in the Bahamas), is from price pressure on oil extraction itself:

most of the sweet, low-sulfur oil has already been pumped
remaining reserves are very deep or very high sulfur
poor planning resulted in contaminated oil fields
rig costs have been dramatically escalating
many fields have been nationalized and not owned by Big OilIf there is a smoking gun I haven't found it. Futures traders, OPEC, and large companies such as Exxon-Mobil do not seem capable of gaming the system by themselves. I've checked out the hedge funds, which were a likely candidate, but most of them have gotten out of the crude oil market (they went into coal, ethanol, and wind). Frankly, I'm dumbfounded!
-sammie

Ok Sammie.... here's one for you. Years ago I Captained a sportfish for a former VP of then Mobil Oil.A real inteligent,forthcoming and friendly guy. By his own statements on many ocassions he would profess how diesel fuel was all gravy for the oil companies,as it costs less than half as much to produce. Diesel used to be cheaper than gasoline,now in many places it costs more. Tell me Sammie .....who has a stranglehold on the global economy considering that all necessary transport of any consequence uses diesel fuel? Most of our personal transportation needs are met by gasoline and a good bit of it is discretionary,but no transportation entity,trucks,trains,buses,ships etc burn a drop of diesel indiscriminately.

BTW/I heard on the news last night that a sack of flour has gone from $9.00 to $30.00 for a 50lbs. A loaf of bread is expected to be $4.00 by summer.All because farmers are not planting wheat but are planting crops directed at producing ethanol that are US Government subsidized.Considering that the internal combustion engine achieves 25 percent less fuel economy on ethanol,I wonder how that will work out?

[SamFamAustin]

Hey, I never said I understood it all, like wheat prices going through the roof and diesel being so darned high for no good reason. Just so you know I do read stuff from the Economist (England), Spiegel (Germany), and maritime news from Singapore and not only the US media which I think is vastly distorted. Unfortunately, it all has baffled me instead of making me a smarter person, honest bruddah.

What I heard, and please don't kick my Ess, was that refiners make more money converting crude oil to gasoline than making diesel. So in the US most refiners might get distillate on the first refinery run but do it again and again to squeeze more gasoline out of the juice. This caused an artificial shortage of diesel Number 2. If you have a shortage in supply, you can justify higher prices. It's pretty dog-gone devious if you ask me.

The Economist also says there is no reason for trading things like wheat and diesel so amazingly high. Their explanation was that maybe (maybe) a flood of money left the financial markets and dumped into commodities. They conclude that is solving the housing bubble by diverting massive funds elsewhere, they may have created ANOTHER bubble which can pop just as easy. Oh my goodness.

My take on metals like gold and silver is they may be highly inflated as well, although I can see the logic about platinum. I wouldn't bet on platinum unless I was able to cover my ... err ... assets, though. :D
-sammie

[Wonkee]

[quote=Beer Baron;23415]
I believe that much of the blame lies within the subprime mortgage market. They were giving out loans to people who never should have gotten them like they were candy. Then they cried to the government when they got burned by the inevitable foreclosures. quote]


People must be held accountable for thier actions, If we bail all of these people out all it does is teach them that we can borrow as much as we want and default because the Government will bail us out. I would argue that most of these people that got Subprime Mortgage loans are able to read, and it tells them in the contract what they are getting into. "Well I didnt Understand what it ment" Too dang bad, if you didnt understand it is your responsibility, Hire a lawyer to look over the paperwork it is one of the most important purchases that you will ever make. If you get a car loan and don't pay it they reposes your car. Same with a house. Live within your means. We have come such a long way as a country, From a time when our Leaders Said "Ask not what your Country can do for you, but what you can do for your country(JFK) to a people that want a Leader that asks "What can our Government give to you."Take responsibility for the decisions, and actions that you take.

We have had a slow, market, but the medis has blown it so far out of proportion that everyone is in a panic. They think we will have had a crash like in 1929, and the world will end. The market dropped 67% in 1929 and it dropped 23% in 1987 which by the way was followed the next day with the Highest ever recorded trading increase in a single day. The highest drop in the last 15 years was Sept 17 of 01 just after the market reopened from the Terroist act on the World Trade Center and it was only 7.9% flucuation and the highest single day drop since 1987. The biggest hit this yearwas in Feb a drop of 3.09%.... But if we are told a lie long enough we eventually start to believe it, and make it true. Ask Hitler It worked for him.

[trubahamian]

There is truth in every word you say my brudda,but a couple of things you left out.
When the price of starter homes are out of reach for young people...it is tme for an adjustment.

A good many of the foreclosure signs that I saw on my recent visit were in previously blighted inner-city neighbourhoods. Getting inner-city working poor into homeownership is an important step in bringing blighted neighbourhoods back into acceptable places to live. These efforts are important in every way and taking certain risks to do so should be commended.

As a black man my observation is that homeownership is an essential step in bringing inner-city black Americans into mainstream America via the pride of owning their own home.

[Wonkee]

There is truth in every word you say my brudda,but a couple of things you left out.
When the price of starter homes are out of reach for young people...it is tme for an adjustment.

A good many of the foreclosure signs that I saw on my recent visit were in previously blighted inner-city neighbourhoods. Getting inner-city working poor into homeownership is an important step in bringing blighted neighbourhoods back into acceptable places to live. These efforts are important in every way and taking certain risks to do so should be commended.

As a black man my observation is that homeownership is an essential step in bringing inner-city black Americans into mainstream America via the pride of owning their own home.

I agree and the fact is that Government targets young Blacks and the poor they train them to be dependent on the system, and sadly only a few realize what is going on and get out. Education is a huge part of the solution. opening up jobs, and oppertunities. But we must remember that it is our own responsibility, not our governments.

[Abacoparrott]

I remember when my wife and I bought our first home.......not only did we have to make enough to qualify for a loan and pay for it, but you HAD to pay at least 5% down......if you didn't do these things, you rented. Today, all kinds of loans can be had with no money down.....and they loan money to people of all colors who have no chance in hell to pay it back. The answer? 1. Get education 2. make money 3. save money 4.buy home. Unless you got a rich daddy, there are no shortcuts....and you can't change the order.....Ken

[HALF-A-HAMIAN]

Get ready for the barrage of "Sugardaddy" requests, Ken!!

[SamFamAustin]

Why Ken prolly has a nice abode with lotsa love seats and fuzzy carpet, a boat called a Trojan (woo-hoo, I'm in heaven), Atalaya (old offshore fishing boat) and a hidey-ho cabin up in the woods. Perfect! Wonder if he needs a deckhand or a chili boss or some thang. We can call it Parrot-ville instead of Hoover-ville. I think we can get guv'mint tents and some trailers fer the over-flow.

Sure beats any stuff I heard these days in the debates!
-sammie

[papanasty]

I must say i have enjoyed reading the responces i have gotten back on this thread, most of it i'm to uneducated to understand but i'm learning! A lot of the post i have to read several times to understand what point your tring to touch on from the thread but i am enjoying it.

I notice alot of post about oil and the amount of oil and the PRICE of oil and all relavent to what i consider our down fall in the economy, it seems to me that big oil is calling most of the shots rite now and doing a good job of holding us all in check.

I also noticed that most all agree that the US economy and the Bahamian economy are comeing closer and closer to being as bad as the other financialy, i wish i understood more about how this big buisness works, i do think part of it is consolidation, more corporation holding more and more of every thing we need to survive and blameing all there increases on the oil companys,were does it end!

There is definetly a lot of greed out there but it seems so wide spread that you just can't pin the down fall on one entity, i just hope the inflation rate tappers off instead of turning around every thing is a little bit more to buy, it's like a pimple that just quite wo'nt come to a head you squeese and squeese and can't quite get it all, thats kind of the way i feel like a pimple thta wo'nt quite go away thanks for all the posts really enjoy everyones interpertation Respectfully Papanasty :eek:

[SamFamAustin]

I always look forward to your posts, Papa. One thing that strikes me is some people think business should be something "nice" without any greed, profit taking, or devious ways to make money. Even in the days of honest farms and honest fishing, it was a race, derby, and war to get your product to the market first every year, since being first you get the highest prices. Nothing nice about it - just a fact of how the system works.

In the old days there used to be real markets - like Fulton's Fish House in New York and the farmer's markets of the Lancaster area in Pennsylvania. There really aren't any markets any more, just businesses and people. The largest "market" in the US is the 70% of the economy involved in consuming things like houses, food, computers, cars, and fuel. Not really a market is it? So when 70% of the consumers feel down on the economy because their paycheck can't get all those nice things, it affects the entire global economy.

But I'm still confused about it all. Seems like a whole generation of folks had "business" that didn't look like a business at all. I mean come on, gambling on different currencies, hedge markets, index funds, and insuring those gambles really isn't work, adds no value, and when they tank cause a ruckus in the economy. Gosh I had no idea, but the mortgage on my little beach house was resold five times, indexed to a fund, and now I get letters about my mortgage from all these companies I have no idea existed. At least if you flip land you tried to add some value by surveying it and putting in some water taps or something. These holding companies are nothing better than an illegal gambling web house. Modern day pirates, all of them!

[Beer Baron]

I have to admit I'm pretty very impressed that we're managing to have a civil conversation on such a volatile subject. Kudos to Papanasty for bringing up such a rgeat topic for discussion!

@ Wonkee Re - post #50: Accountability has to come back into play at some point. Americans have been borrowing money on terms they simply can't afford sustain for for too long and presuming they will be able to refinance if the payments become too much. In the near future, I see foreclosures jumping up, and mortgage lenders tightening up their lending regulations to the point where you will need to prove you don't need the money to get a mortgage loan.

Though it's a dang shame, and it's really been beating my industry up lately, it needs to happen. I've had to put off at least two couples within the last 6 months and tell them they're better off renting for 2 more years, repairing their credit, paying down debt and saving more for a respectable down payment.

One of those two couples went to another realtor I know. They got into a contract on a property that they could never possibly afford and when the time came for mortgage papers to be drawn up, they were not even close to getting approved. The whole thing turned into a big mess.

Sellers who couldn't buy their next home, and the people the sellers of the home that didn't go through were howling about a lawsuit. In real estate there's a domino effect that can really be painful to watch when the greed genome kicks in.

Had that couple I advised simply listened to my prudent advice, none of that would have happened!!

[SamFamAustin]

Obviously people didn't listen to good real estate agents like you, Beer Baron! I hear these horror stories about people making $50,000 a year being sold houses worth $650,000 with teaser balloon notes and ARM's. Unbelievable. I've always been conservative and estimated that you should not buy a house if you can't pay 1% of it a month ... so my old house a little over $200,000 would be $2,000 a month ... and I was real close with taxes and insurance on the last three houses after putting 10% down. Of course you run the numbers down better than that but hey, if you can't afford it don't buy it.

Some of the problem as you hinted was that people just wouldn't take "no" for an answer ... they saw the ads on TV that promised instant approval for houses up to $400,000 and even companies offering jumbo notes well above that. Just go get two or three notes! It's as easy as 1-2-3! You're pre-approved, baby! Act NOW.

I bet these huge companies put the hurt on the real estate agents because you could almost shop for a house and a mortgage over the Internet without needing one. In hindsight, maybe the government should have been paying better attention to the situation, as many people simply didn't know any better. I mean when I was 25 it is true I thought I knew everything, but really didn't ... there we were, mama expecting, me scared as heck, and an offer for a house we couldn't refuse. Oh yeah, I went through all this back in 1985 or so ... the culprit then were Savings and Loan companies that had to be bailed out by the Fed buy WE weren't. To this day I refuse to eat peanut-butter sandwiches or Campbell's tomato soup.

But don't get depressed ... it seems like after one of these mini-recessions or "stagflation" people make more money than ever. The blue-collar and lower middle class sectors might take it on the chin a little, but recoveries if viewed over the long term end up with better overall market conditions, land prices, and so forth. The only wisdom I have to offer is that when one bubble corrects itself, the seeds are already laid for the next one down the road. The money has to go somewhere, ya know. /sammie

[Abacoparrott]

Get ready for the barrage of "Sugardaddy" requests, Ken!!

Hey Half......I'm afraid the lovely Carol has already "drained" all of the "sugar" requests.....now if a few 22 yr olds wanna make a "daddy" request hmmmmm........I'm gonna git in trouble for dis one......Mandy? Ken:D :D

[trubahamian]

As Sammie says,the real estate adjustment has happened before. It usually stagnates the economy for a period of 2 years or so,but this time there are skyrocketing energy costs and a staggering war debt to consider. It seems to me that it might take a lot longer than 2 or so years to recover this time.

[HALF-A-HAMIAN]

The Government says they'll make money the old-fashioned way......they'll print it!

[papanasty]

Man Sammie you hit that nail on the head,theres nothing nice about being in buisness, because in todays times and NOW throw the economic factor in there and it's BRUTAL. The Chineese are throwing every thing that they can manufactur at the US for a 10th of what it takes to do the same thing in the states and the worst part of that is the big corps. in the states are backing them,nothing like s******* in your own lunch box.

What ever happened about looking after your own,back in the 70's and even the early 80's the US had a lot of pride in what they did and what they made it was called MADE IN AMERICA and you could count on the product what ever it was and it was worth the dime you spent on it,not today big corps all they look or care about is the bottom line and there looking for the least that they have to spend to maximise there profit margin.

I'm all for makeing a profit but these oil companys have gotten out of hand,there greed has affected every DAM one of us, theres no way a barrel of oil should cost that much to pull out of the ground especially with todays technoligy prices should be going down! They do it because they CAN. Boy if there was some way that we could gather the masses and every body just stop buying gas for 1 month the price of oil would plumit to half the price it is today and all other commodities would follow,this whole dam economy runs on oil, that stuff goes in to just about every thing made one way or the other.

I got a uncle that retired from the Military 20 years ago and when he retired he bought himself a big rig and has been driveing truck over the road for the last 20 years and he never did it for the money because there is not a big spread in profit for a truck driver that owns his own rig ya do it because ya LOVE it! But not today,talked to him about a week ago and the truck is parked dropped the insurance pulled the tags because there is no money in it,NADA, NONE, ZIP,it costs more in operational costs than you can get for the load, thats the sad part because he did it because it was his lively hood and at todays fuel costs he has been forced to give up what he LOVED to do, any way i've said enough for now just felt lIke RANTING Respectfully Papanasty :(

[Abacouple]

[quote=Scott Burchard;23464]
[FONT=Arial][SIZE=3]What they do agree on is that economic cycles have been and will continue to be. They

[SamFamAustin]

So far all the economists have gotten the economy wrong and the political polls have gotten the votes all wrong, so we'll see my friends, we'll see.

I sincerely hope all the bruddahs and sistahs in the Abaco will weather this little storm like anything else, same as a hurricane, and will continue to prosper as only a Bahamian knows how to do. Amazing people.
/sammie

[PELLUCID]

@papanasty:

If you'd told a Marine platoon at Lake Chosun that the grandchildren of the Chinese surrounding them would be making incredibly cheap toys, clothes, shoes, and computers for their grandchildren, what do you think they would have said?

The vast majority of it would have been unprintable on this forum, but one thing might have been "What's a computer?" Their commanding officer might have said "Hey -- my wife is a computer, at Camp Pendelton!" because back then "Computer" was still a job title and women were considered better at it.

So today we keep millions of Chinese busy building gadgets for us. Is that not a small price to pay for peace?

People complain about things, because that is human nature. But I gotta tell ya, in my 45 years here I have seen the size of our problems get smaller and not bigger. I can still remember the Cold War. I can still remember oil prices doubling almost overnight. I can still remember 10% unemployment and 13% CDs at the bank. Nothing we face today is as scary as that.

[Sail41]

I've been following this discussion since Pappa started it. If Dr Ralph feels this is improper, please remove.

I don't think the oil companies are necessarily the villians. We haven't allowed a new refinery since the 70s. Lived in TX for a while and the refineries never seemed to affect the Corpus Christi area too much unless you consider full employment a problem? OPEC has said they'll give us as much black gold as we can process. Now, if we look at the GREEN fuels, they get nothing but tax credits from our government while oil pays BILLIONS in taxes. Ethanol costs us far more that we benefit from it. Not only in fuel costs, but milk, bread, any corn product. We're getting sold down the river on global warming and new fuels. I have NO connections to any oil concerns.

Now, I fill my trawler and it's 500 gallons at a clip. I don't like $3 diesel any more than the next person, but if I want to cruise, I pay.

I'm lucky enough to live in a great condo complex with 50 slips. I've lived here since 96 and have brought numerous other cruising boats here. We have no less that 20 larger vessels that USED to cruise the Bahamas expecially Abaco frequently. I never missed a year from 1991 thru the early 2000s. Spent a bunch of cash there as well!

When I first started coming to Abaco, I spent 4 to 5 mos a year. $30. to clear including my permit. Then $100. OK I said that works out to $15. for 4 perople plus permits. $300. Ah, myself and others put the brakes on. Haven't been since and neither has the majority of our boats. We're not cheap or poor, only feel cheated. Bahamaians pay $19. to come here? So we don't spend money in your resturants, marinas, moorings, fuel docks, grocery stores, or anywhere else in the Bahamas. We keep it here. I don't object to fuel at prices there or any other items we spend money one. That's the luxury of no other taxes other than duty. No big deal.

We catch a lot of fish here off Port St Lucie, Sailfish capital of the world.
The Keys aren't too shabby either. Or I can tow my whaler to Dr Ralphs area and easily spend a week at Rock House Creek and fish to my hearts desire. Then with the money I save enjoy a bunch of evenings out for dinner at the local resturants. Or head to the Chesapeake and enjoy other wonderful areas of the USA all wanting our business.

You want the people to fly in or you would of also raised the departure taxes for them. just don't want cruisers anymore. Our money isn't any good. The $15 departure tax would now be about $135. if you were being fair.



My RANT.

[SamFamAustin]

Heck man if you wanted the business you would check in at customs and get some freebies and no cruise permit costs or tariffs at all. I don't know if the Bahamians know what a drag that is, the foreign cruising. I mean honesty, didn't they call it the "Cruiser's Net?" Man, that was some bread and butter for the Abaco trade I have to agree. My dad says it's definitely off, and he sold his trawler too.

[papanasty]

I have to agree with you on most of that, i to can remember going to the gas station with my mom to fill up the 1966 Buick Electra 225 and there was 4 station one on each corner and gas was 6 cents a gallon you could fill that boat up for $5.00 and it would last the whole week,try and do that today?

I can remember when you would go out to play and there was 7 of us in the family and the only time you new it was time to come home you could hear mom yelling all our names from the front porch through the neighborhood just before dark and you new dinner was on the table.Today you can't let your kids out of site because some pervert out there might steal them.

I can remember when my mom would give us a dollar for 3 of us and we would walk about a mile to a little store called Burns grocery and we could get all the candy the 3 of us could eat that day all for that dollar,ya those were the days.

I can remember when i was stationed in Jacksonville at Mayport Naval Station i had a 1946 Harley Davidson 45 cubic inch flat head 3 wheeler that i built from a basket case i got from a guy for $500.00 and when i had liberty i would go down to Jacks Bch and build a big fire on the beach and spend the whole night on the beach, one night i got so drunk i woke up the next morning on the bike and i had parked my bike to close to water and the low tide and when i woke up i was 2 feet in the water because the tide had come up through the night, try and spend a night on Jacks Beach today and they will probably put your *** in jail for vagrancy.

I hitch hiked to Florida a couple times from Minnesota, i could'nt stand the cold weather in the winter there so i would quite my job what ever it was and head south for the winter,i could always get a job i do'nt know how many times i started over in my life. No one hitch hikes no were now days it's not safe, life used to be so easy and fun.

I can vividly remember in 1973 when there was the big gas shortage and they actually closed all gas station across the US on sundays i believe that was when the first big gas increase came in to play and after the price went up the ban on sunday gas purchases were lifted and there seemed to be plenty of gas available, tell me that was'nt planned by big oil companys! And now there doing the same thing again, gas today is 75 cents a gallon on average more today than it was a year ago.

The part i do'nt agree is on the last paragraph <nothing we face today is as scary as that > i believe that is a understatement every week some one is shooting up a shopping mall or a class room of students and teachers are getting killed or a disgruntled worker that lost his job is takeing as many people with him that he can because his life is ruined because of for what ever reason,maybe thats why i ended up here it is safe here and some were in the back of my mind i must have realized that because i'm still here.

Bottom line is it will never be like it was you know that and i know that there is so much confusion today in what direction we will go in economicaly, enviormentaly and emotionaly that it's the toss of the hat rite now lets all hope it drops with the top up Respectfully Papanasty :)

[Tropical Concepts]

Believe it or not these are really the good old days. At no time in human history have we been this safe as a world or nation (USA). I cannot speak for statistics for anywhere but America. People and children are safer from attack or molestation now than at any other time and the stats prove it. However we are subject to the slanted news of crime hyped and instantly in our life like never before. As a matter of fact children have a higher mortality rate now , because kids are couch potatoes are are dying of sedentary lifestyles. There are new industries and medias at work- police enforcement and sensational news media feeding into these fear feelings, but the facts don't support it . Crime especially violent crime has in fact really signicantly declined for decades. When infation is factored -gas is a much better bargan than it was in the 70's and 80's. Most of us are living pretty good lifestyles- on the whole we've become pretty soft in the middle over the years.

[ScottB]

[FONT=Arial][SIZE=3]The

[SamFamAustin]

I agree that things aren't really all that bad and that the oil companies are just following world crude prices and must make money to stay in the game. However, every once in a while, like the Iran "oil for aid" U.N. program, some funny stuff happens. The strangest thing was the two gas "shortages" in the 1970's.

I happened to be down by Galveston on a fishing trip then and couldn't believe my eyes: there must have been 40 or 50 huge tankers loaded down waiting at the anchorages at Bolivar and offshore the jetties. I asked and the boat crew said that those tankers had been sitting there for weeks and weeks. Something wasn't adding up.

So I talked with an owner of a truck stop just south of where we lived in Austin, as we were building an annex and restaurant for his truck station. He said he couldn't sell but his quota but that he could buy all he wanted. Of course, being Texans, we called his Bolshoi right then and there. Well he drove us to his house where he had a dozen 10,000 gallon tanks full of gasoline and diesel in his backyard, the lawn all carefully mowed and the tanks painted perty. He was right, and what a sight!

Usually I don't go for conspiracy theories but witnessing some of these things in person gave me a new perspective. If I can only buy a few gallons here and there (remember they tried "liters"), what's this turkey doing with 120,000?

[ScottB]

OK

[FONT=Arial][SIZE=3]Let

[SamFamAustin]

Sure, consumer boycotts rarely ever work and for retail gasoline, ever. Most gasoline stations don't even swing a profit on gasoline anyway, making only a cent or two a gallon. Gasoline is simply there so you can spend money on junk food, sodas, tobacco, and beer (extra points for Lotto tickets). Plus as you said, most of our jobs require commuter fuel and unless you have good mass transit, you will pay for the fuel just to keep your job. No job, bye-bye house.

Yuck, housing is not a happy thing to talk about and energy really isn't more than a horrible aggravation and source of frustration.

But here's a unique perspective I got from the fishing forums I read, especially the Gulf (Mont, who designed this Abaco Forum website runs the best fishing forum anywhere). Those oil & gas rigs out at sea are fish attractors. People will drive 150 miles out into the ocean just to fish ones with legendary names such as Boomvang, famous for holding yellow fin tuna. It's different from other coasts and Florida where oil & gas rigs are viewed as the ultimate destruction of all things good. We like 'em! From an energy resource perspective, these rigs in the Gulf are good for fish and are a major source of juice for the US economy, more than Alaska.

[ScottB]

[FONT=Arial][SIZE=3]Folks are afraid of the potential consequences of large oil rigs off their coasts. They want the oil

[ScottB]

[FONT=Arial][SIZE=3]A fair while back

[SamFamAustin]

Well the semi-submersibles and spar rigs can be moved, and indeed some even have propellers on them. The inshore rigs solid-built on concrete footings are supposed to be moved, toppled, dismantled, or even blown up. These regulations were set in the 1950's and revised internationally in the 1980's. At the time, such old rigs and wells were considered to be toxic sources even if they were cleaned and the well was plugged with hydraulic cement for thousands of feet down.

In the old days drilling fluids and muds did contain barium, mercury, cadmium, and some bad stuff. Nowadays more benign material is used because of EPA and international regulations. What you see underwater is a vast complex of metal, pipes, and flanges ... all covered in marine growth including rare corals, lobsters, scallops, and all kinds of good things. In the Gulf of Mexico, schools of thousands of red snapper (yum) circle on the bottom as pelagics dart in from above and the outside. There is a big debate whether the rigs actually create bio-mass but they do seem to call them in, from the lowly worms and corals to the noble sharks and tuna. Needless to say, when they are removed they are sorely missed.

This is a funny aside and slightly off topic ... but ever since 9/11 and the Homeland Security rules, all active offshore rigs got a 500-meter security zone around them, about a half mile. You can ask the rig's radio operator to come in closer though, since the HUGE grouper are right next to the rig. So one old boy decides to stop by Hooter's and ask a few gals to come out fishing way out at sea at the rigs, which they all did.

It worked for a while but then the boat's captain got an urgent message that the entire rig's crew of men were taking pictures and looking through binoculars, some even fishing, not a bit of work being done, and could he please leave? Reluctantly, the boaties pulled away from the rig to troll and nailed some world class wahoo, Mako, and yellow-fin about 1-2 miles away. :D

[HALF-A-HAMIAN]

In the '70's, when I was driving over-the-road, my route would take me through Cairo, Ill. The Ohio and Mississippi rivers were lined with barges of petrol, which I learned were taken to southern ports, off-loaded to tankers, taken 200 miles out and then return as "imported" oil, and thus they were able to charge higher prices. This is not as far-fetched as it sounds, as at the time, I was loading "California vine-ripened tomatoes" in Chula Vista, that I would watch come in from the Mexican side. I would then take this load to Pompano, Fl. and sit inside the packing house, where they would unload them to a conveyor and repack in boxes marked "Florida vine-ripened tomatoes", load them back on my truck, and I would bring the back to market in Kansas City. Truth in advertising at it's best I guess.

[papanasty]

Scott thats probably the way it would play out, I know it would be a long shot and really only is a pipe dream! Theres no way the economy or the people could hold out long enough to make any impact on such a move the oil comanys just got to much money and your rite we would buckle and the end result would probably be even higher fuel prices.

It's just such a bummer for some one to have you by the balls the way these oil companys do, And this biofuel craze we are going to end up with higher prices for products that use corn because the farmers are selling there corn to Bio fuel companys in the mid west because they get more money for it.

It's funny back in the 80's when i worked for Industrial Dredgeing and Engineering we did a lot of work in Buella North Dakota for the strip coal mineing companys,when they strip mined for the coal for so many acres they would strip they had to build these run off ponds for sediment run off after reclamation of the land. The ponds would fill up with clay run off so we would go out there and pump from one pond that had to much run off in it to ponds that did'nt have much in it, what a joke moveing mud from one pond to another.

Any way there are lots of coal power plants in that part of the country because of the coal being so close but the coal is real high in sulpher out there so the sky would always be red from the pollution, this corn based fuel was just comeing into play about that time and Buella was a boom town because of the amount of corn grown in that part of the country the big oil companys were building these corn refineries.

I spent about a year out there pumping mud from one hole to another and in that time there was 6 gasification refineries being built at one time,me and a buddy rode around one day and counted 175 tower cranes or large cranes between the sites and 10 years later they still had not produced 1 gallon of corn born fuel, I believe to this day it was all a prop by the oil companys to say they were doing all they could to help to try and change the enviormental impact of fossil fuels.

I was watching the news the other night and they brought up Indiana and 93% of the land is used in the state for growing corn, and just about all of it is sold for Biofuel. The thing about corn fuel or ethonal it costs more to make than the fossil fuels and ya loose about 30% in economy in your vehicle that will burn it and this in turn costs you more money to operate your vehicle but they claim it's better for the enviorment, It just do'nt make no sence to me.

I quess we will all just have to adjust like you said, we did it in the 70's and i quess we will do it again, what do you think it will be like another 10 years from now? :(

[FarmerBob]

Another point of view...

http://finance.yahoo.com/expert/article/yourlife/47180

[Abacoparrott]

Nice article but......you certainly can't compare the percentage of profit of oil with....say....diamonds. One makes their money with high mark-up due to low volume of sales, the other is based on huge volume. I used to be in the fabric business with Burlington Industries(many years ago). They frequently only made about a nickel a yard but man......did they put out a lot of yards! Besides, how do you explain that the oil companies were making good money just 2 1/2 yrs ago and now gas is 2.00 per gal higher?? hmmmmm.....remember, it all started with Katrina. I think the oil prices were HONESTLY driven up with that situation and then, the oil companies noticed that the people were paying it so from then on.......a few contrived excuses for higher prices materialized. Now let's not blame the oil companies entirely......how many years has it been since the US has started building a new refinery?? Over 30 I believe. Why? cuz the enviro-whackos have made it soo expensive to jump the hoops to get permits that an investor with a brain isn't going to invest in the construction of one. The only present refinery that is trying to get built has incurred a PERMIT PROCESS COST of about 25% of the refinery's cost. AND an investor will have to wait AT LEAST 10-15 yrs to realize a dime of profit. In addition, the drilling of reserves in northern Alaska was stopped by the same sort of groups over 15 years ago....reserves that would have provided 15 -20% (projected) of America's usage IF required to stay here......a percentage plenty big enough to make an impact on our oil prices, especially if we had the refining capacity. The enviro-whackos did the Big Oil's bidding for them......and Big Oil is laughing all the way to the bank.....so let's be honest with each other and look at who is a large contributing factor to these ridiculous oil prices......they might be sitting right next to you.......Ken

[ScottB]

[FONT=Arial][SIZE=3]As of yesterday, there

[DrRalph]

No good news today on the economic front. Consumer confidence plunged, the wholesale inflation rate soared, the number of homes being foreclosed jumped, home prices fell sharply and a report predicts big increases in health care costs.

The New York-based Conference Board says in a report released on Tuesday that its Consumer Confidence Index plunged in February to 75.0 from a revised 87.3 in January.The reading - the lowest since the index registered 64.8 in February 2003 - is far below the 83.0 analysts expected.

Inflation at the wholesale level soared in January, pushed higher by rising costs for food, energy and medicine. The monthly increase carried the annual inflation rate to its fastest jump in a quarter century. The Labor Department said Tuesday that wholesale prices rose 1 percent last month, more than double the 0.4 percent increase that economists had been expecting.

The January surge left wholesale prices rising by 7.5 percent over the past 12 months, the fastest pace in more than 26 years, since prices had risen at a 7.5 percent pace in the 12 months ending in October 1981.

The number of homes facing foreclosure jumped 57 percent in January compared to a year ago, with lenders increasingly forced to take possession of homes they couldn't unload at auctions, a mortgage research firm said Monday.

U.S. home prices lost 8.9 percent in the final quarter of 2007, Standard & Poor's said Tuesday, marking a full year of declining values and the steepest drop in the 20-year history of its housing index.

"We reached a somber year-end for the housing market in 2007," said one of the index's creators Robert Shiller. "Home prices across the nation and in most metro areas are significantly lower than where they were a year ago. Wherever you look things look bleak."

Crashing consumer confidence, inflation, record numbers of foreclosures, $100/bbl crude, soaring US government debt, a severe credit crunch; this is a multi-headed hydra, and I see it lasting "a while." There is no quick fix, even if we stopped the war tomorrow and oil went back to $50. Money is going to be very tight for most of us, and I'm afraid that means fewer vacations for a lot of people.

Perhaps the Bahamian government will be motivated to reverse some of the policies that have driven some visitors away, such as the new fishing regs or the $300 cruising permit. You hear it everywhere, including right here on the Forum: "I staying home, I'm going to the Keys, I'm doing something else." The leaders of a small nation with what is becoming a very fragile and vulnerable economy might want to take a second look.

[trubahamian]

Tru dat! You een neva lie Doc.

[DrRalph]

Tank ya, Mon;) .

[Patti Puzo]

I think I will plant a bigger garden this year.

[Wonkee]

Google
United Arab Emirates take a look at the Growth over the last 20 years..Were not paying too much....Yeah right!

This Hotel is actually a house.
It is owned by the family of Sheikh Zayed bin Sultan Al Nahyan Former President of UAE They make no money at all thier impoverished conditions are just unberable.....
And the Car is not just painted Silver It is made of Silver. The Audi A8 was made for a Sheik I guess it won't rust. Guess $3.00 a gallon is not very much

[trubahamian]

WOW Some digs! Ya know...I was always taught neva to count another man's money,but it tough these days man cuz I ending up with less of my own to count! lol.

[ScottB]

[FONT=Arial][SIZE=3]Apparently they were lacking enough recreational diversity, living in the desert and all, and they apparently can

[Long Look]

Why does the world seem to look to the US for money and food aid... I am sure would be able to buy up the excess food stock from the US and ship it to africa... but then you look into their own countries and see those who are not rich princes and find out that they are not rolling around in cash...The middle class in the middle east dont quite have the life that middle class have in the US... And I cant blame Dubai for doing what they are doing, the oil is bound to run out someday. So the 3 billion square foot theme park will brig some cash into Dubai.

[junglejane]

I am buying a lottery ticket 2x a week

[papanasty]

Well if any one watched the world news tonight the economic out look is not good,lowest new home sales in 13 years and gas is on the rise again along with a sharp rise in the cost of commodities, we can expect gas prices to rise to $4.00 a gallon by the end of the year PROBABLY! Estimate encouragement on a up turn in the economy no time soon. Not my words just what seems to be preached every day nationaly from 6:30 to 7:00 daily, Wish i could hear some thing encourageing but it always sounds the same or predicting even worce! :( Papanasty

[HALF-A-HAMIAN]

I know the One who's in control, and He said not to worry, be happy! He owns the cattle on a thousand hills, and Dr. Miles Monroe says He lives in the Bahamas, and I tend to agree!

[Long Look]

yeah the credit industry sure did screw up the economy. It will be interesting to see the reaction that congress makes to control lending in the coming year.

I dont believe that the economy being down is the fault of rising prices... I believe the fault lies with greed... and not the greed of the millionaires that everyone blames. I believe it is the greed of the common American. The number of Americans who are heavily in debt. The number of houses in foreclosure last month was a record, and according to data the home owners had very low equity in their houses. Credit cards are a trap that people fall into because they want what they cant afford.

I just wish the American public would listen to this "DONT BUY THINGS YOU CANT AFFORD" and "DONT TRY TO KEEP UP WITH THE SMITHS BECAUSE THE SMITHS ARE BROKE".

[patw]

Article from the Nassau Guardian today.
http://www.nassauguardian.net/bixex/298580270418452.php

[Marty]

I wouldn't be so quick to judge the credit industry. They just created products that idiots would buy. Every loan has lots of fine print and you should know what you're getting into when you sign on the dotted line. Granted, there was some predatory lending going on, but I don't think that in any way was the full cause of the problem. I think predatory lending was a by-product of these alternative loan products, making it easy to "hide" the true consequences of the loans from those less educated in financial matters. I do agree with you that it is the greed of the general population that made them keep over-extending to the breaking point.

I also don't think I should be held responsible for bailing them out. They made bad decisions, deal with the consequences. Legislation will not cure idiocy.

[Abacoparrott]

good article Pat....it illustrates the importance of the 2nd homeowners and the "loyalty" that this kind of individual development tends to breed.......and this tourist success in spite of government efforts (read 300.00 cruising permits) to slow it down.....I don't think anyone should "mess with success" should they?? Ken

[Sapelo Son]

Honey Baby and I are getting a "double whamey" right now! She is in Real Estate and I sell 2x4's. The good news is we are begining to see some slight recovery of business in our area(little flicker). We feel like we are just past the bottom and in the "ever so slight" beginings of a recovery. It will be very slow the rest of this year and get rolling (somewhat) next year but, we feel the worst is over. All the numbers that we report to the government, that are used to measure the economy, get input quarterly. Then it takes them about three months to crunch'em. So in about 6 months you should see the numbers start showing what we are seeing "right now". Times are still very tuff, but, there is light at the end of the tunnel!!!!!

[Wonkee]

I have been working construction since High School, I have done Commercial, Residential, and Remodeling. 10 years ago in the KC market we sat around on job sites not working too hard because when we finished a project we were not sure that there would be another to start. The big building boom was not around yet. I moved to Abaco right at the begining of the boom it went on from late 90's until about 3 years ago, then it suddenly started to drop out. We had built too much. Market Supply had outgrown demand. We had 400 houses for 300 buyers, but we kept building, and further flooded the market. Now when someone needs to sell a house it is not worth as much because everyone else is trying to get rid of a house that they overpaid for or couldn't afford. It will continue until the Demand for housing rises enough to take up the slack and the balance is made. The key then is to not get so greedy next time, and work ourselves out of a job.
The unstability of Construction, and the realization that the market was fading fast is what led me to College, and to Education. People will always need Salvation, and Educating. So I figure I have Job security for a while, no matter the Economy.

[SamFamAustin]

I've been down that path, Wonkee, used to frame, sheetrock, tape & float, paint, and trim. Education was my ticket out of all that.

But this little bout of economic stirrings is truly strange. Some companies are making more money than ever ... and some summer resorts are predicting a shortage of workers in the US. A shortage? This is truly nuts!

I have no idea if there is a seasonal shortage of workers in the Abacos, probably not, but here in the States kids won't work for seven or eight bucks and hour ... so they import them on the student and guest worker visas. It's amazing, some coastal resorts saying they might cut back on services because of labor shortages ... when half of Michigan is out of work. I think our economy has finally gone berserk.

Like Sapelo says, we're starting to see some folks cutting lose of some money, since the money has to go somewhere and you can't stuff your mattress forever. We'll see because the spring is when people move, start house construction, and make summer plans.

And as PatW linked in the article about Abaco tourism, our little island in Texas is seeing lots of renters and happy tourists ... just not many wanting to buy or build here. /sam

[Spagna]

Come November We'll be doing what we can to jack up the Bahamian economy on every island group we can over a 6 month period by paying that $300.00 fee, drinking in the bars, staying at marinas, drinking in the bars, dining in the restaurants, drinking in the bars, buying rum, drinking in the bars...oh yes did I mention drinking in the bars?:p:p

[Spagna]

Well if any one watched the world news tonight the economic out look is not good,lowest new home sales in 13 years and gas is on the rise again along with a sharp rise in the cost of commodities, we can expect gas prices to rise to $xx.xx a gallon by the end of the year PROBABLY! Estimate encouragement on a up turn in the economy no time soon....

Papa...papa...papa....That same summary has been repeated over and over every few years:rolleyes: I'm not even 60 years old yet (did I day that?:confused:) and in my lifetime I've seen what that news report must consider Armageddon...Premium gasoline used to be $.25/gallon:eek:...cigarettes $.25/pack,:eek: brand new 1800sq. ft. house in suburban NJ $12,000.00 loaded:eek:, new Caddy Fleetwood $5,000.00 :eek: and a Ferrari for $17,000.00:eek:.

Nothing is getting cheaper and next year it will be more expensive and the year after that even more.....GET USED TO IT!!!!!!!!!!!!!!!! You WILL survive this one:)....just do what you need to so that you don't have to care about the NEXT ONE. If you get screwed this time by the economic a**holes then shame on them...if you get screwed by them again next time then shame on YOU!;)

In my neighborhood where I grew up we had a saying, "Don't get mad, get even!" and the best way in this case is to get yourself to a position where no matter what 'they' do you don't have to care. Lots of 'just folks' here in the mountains hardly noticed the 1929 Depression while my grandfather lost $3 million. Hang in there!

[trubahamian]

Papa...papa...papa....That same summary has been repeated over and over every few years:rolleyes: I'm not even 60 years old yet (did I day that?:confused:) and in my lifetime I've seen what that news report must consider Armageddon...Premium gasoline used to be $.25/gallon:eek:...cigarettes $.25/pack,:eek: brand new 1800sq. ft. house in suburban NJ $12,000.00 loaded:eek:, new Caddy Fleetwood $5,000.00 :eek: and a Ferrari for $17,000.00:eek:.

Nothing is getting cheaper and next year it will be more expensive and the year after that even more.....GET USED TO IT!!!!!!!!!!!!!!!! You WILL survive this one:)....just do what you need to so that you don't have to care about the NEXT ONE. If you get screwed this time by the economic a**holes then shame on them...if you get screwed by them again next time then shame on YOU!;)

In my neighborhood where I grew up we had a saying, "Don't get mad, get even!" and the best way in this case is to get yourself to a position where no matter what 'they' do you don't have to care. Lots of 'just folks' here in the mountains hardly noticed the 1929 Depression while my grandfather lost $3 million. Hang in there!

All of this is true except for one small omitted detail that very few talk about.Inflation,particularly in the Real Estate market has far outstripped the pace at how salaries and wages have grown.Not only in the States but in the Bahamas as well.This adjustment in the Real Estate market is absolutely necessary to get prices back into a range where people may once again comfortably afford a home without getting involved in trick mortgages.
BTW/ Can you imagine what your Grandad's 1929 untaxed three million would be worth today? WOW!

[theKurp]

I don't think Spagna's comments necessary omit inflation in the Real Estate market. The market was driven by greed. People cashed in on existing homes and turned around and bought more expensive homes. Other people bought homes they knew they could only afford in the short term in the hopes of flipping them for a profit.

Those that bought more expensive homes are now watching their equity dry up - many to the point where they're upside down on their mortgages. Others got caught holding the bag when the market suddenly froze, then retracted.

Spagna's message is apropos. Sure, it was tempting for me as I watched my house almost triple in value. In hindsight, I should have cashed out - especially in light of the change in capital gains tax laws and ESPECIALLY now that homes are a lot cheaper. Had I guessed right I could have sold, rented for a couple of years, and then bought back in. But I was never any good at playing that game with the stock market in the 90's and I sure as hell wasn't going to gamble with my house given that I really like where I'm located.

Even with the downward spiral in home values, based on comparable sales in my neighborhood, my house has still appreciated at a 9% rate in the eight years that I've owned it. (Of course if I hadn't refinanced at 5%, then 9% wouldn't sit reasonably well with me). So, in reference to Spagna's advice to get yourself in a position where you don't have to care about the economy (to a reasonable extent), the housing market crash hasn't affected me much in real dollars - only imaginary dollars.

However, I do agree that this correction is absolutely necessary for a number of reasons.

[SamFamAustin]

To be sure, what happened with real estate can be considered "freak economics" that was a mix of uneducated buyers and outright fraud on the part of some of the lenders. I think some cases might make it to the Supreme Court as "dumb versus dumber". :D

But Tru has a point that what is happening behind the housing boondoggle is that for the first time ever, wages seemed to have failed to keep up with inflation. Such claims are a little difficult to prove, using broad economic indicators and large averages - the old "lies, devils, and statistics" saying. However, when one combines the lack of savings (the lowest rate of savings ever) with weakness in wages, the effect of inflation can become much more pronounced. Call it "cash-happy and savings-poor."

For any given individual this effect might not be the case, especially if they were insulated by investing soundly, saving money, and all those wise but boring things that grand-pappy told you to do. I think Spagna was referring to this "insulation effect" that minimizes losses. It is a perfectly valid way of looking at the same problem, just a different angle (single view versus economic indicators).

At the risk of blabbing incoherently, what is happening regarding employment masks a fundamental change in the American landscape - that you're earning less. Employment is measured several ways, such as unemployment percentage and number of new jobs. However, that masks the fact that many people working today that used to make over $50,000 a year, such as automotive techs and engineers, are now flipping hamburgers. For this very reason, it is easy to see why people are resentful of "illegal immigrants." [That's a side issue but I wonder how many illegals will be building the new border wall against Mexico?]

But that's the point, that even if you've saved money wisely, you're still on the losing end because the dollar is worth less and your dividends are worth less and your wages are worth less. There is a joke that America is having a giant liquidation sale, nevermind the housing problem. Folks, I can't explain it very well but this ain't never happened before, and this is not a temporary blip or "slowdown."
-sammie

[theKurp]

OTH, with regards to wages, one can employ the "insulation effect" by going where the demand is. How many people choose careers where the demand dries up, either because the service is no longer needed or because an individual has allowed their skill set to become antiquated? Just like factories that retool with advances in technology, we must also be willing to retool our skill set.

It's easy to become complacent in one's career as we get older. Offering up the excuse that we have neither the time nor the ability to learn new things.

As consumers we aren't going to buy something that no longer has a use or has been replaced with a better version. Our skills are a commodity, and it's easy to point the finger everywhere else except at ourselves when we find that we are no longer needed or aren't making the same money we used to. Jobs don't necessarily dry up, they just shift. We need to shift with them to become insulated.

[Spagna]

A 'Correction' in the market is the right term! Housing and stock.

Yes, as I said earlier in the thread my wife and I didn't 'leverage' our entire income to the limit. We bought less expensive houses, cars etc and consequently had no problem making the payments when one of us would be suddenly out of a contract (right sammy it is interdependence on the economy not total independence I'm talking about, although that is a goal worth attaining). We also actually paid them off occasionally!

Right Kurp, Retooling your skillset may be necessary for economic survival. In 1976 when Deb and I got into IT (Data Processing back then) it was listed by US News and World report as one of the top 10 fields to get into. In 1998 IT was listed by the same mag as one of the top 10 NOT to get into because of the glut of talent. Even when IT was the hot field to be in we had to learn at least one new technology a year just to stay competitive and in demand. I went from Programmer to Analyst to Manager then specialized in Quality Assurance when that was hot then back to Certified Project Manager when that was the hot specialty. It is like playing infield in baseball..you have an assigned spot but you've got to move around to get the ball not just stand in one place and expect the ball to come to you all the time.

Maybe this will make my position clear: In 1973 during the Arab Oil Embargo I was 24 years old. just out of the Navy, going back to college, renting a house in north Jersey. I went to the Acme grocery store on Rt. 10 in Succasunna NJ, a suburban community. I walked in the front door and there was no one in the store...I was shocked, stunned, awestruck because there was nothing, nothing, NOTHING on the shelves...any shelves anywhere in the store! Obviously I was S.O.L. for food that day but I swore to myself that no matter what happened in the world I would NEVER AGAIN be in that position!!!!! THAT is what I mean...call it insulation, call it what you like but everything I have done over the past 35 years has been driven by THAT DAY and THAT oath to myself!! It was that day that I understood how my father and his brothers felt about the Depression of 1929!!

By the way the $3 million IS in adjusted dollars...my father and uncles first did the math in 1985 and I have kept it up since then 'Least we forget'!!

[SamFamAustin]

Yes indeed but I think we can agree that the stock markets, of which there are much more than just Wall Street and Chicago, are doing just fine even in a slightly bear market. It is the US financial sector that is kablooey. That is completely different. That are called the "financials" and while some stock and hedge investors sometimes play in their game, most have bailed ship by now to lower market risk. The financials underwrote trillions in paper and insured the CDO, SIV, and other derivatives ... and now it is going up in smoke. Nobody is buying their paper. Very simple.

In a global economy, if the US gets indigestion the whole world starts burping and passing gas. This recent bout with the economy might fix itself by August and we'll all be happy again. There again, when such market fundamentals are so skewed, one might agree that it is not just a simple "correction" like the old days, but something more profound. Not that I'd know! :D

[papanasty]

To all those skeptics that thought i was full of S*** on my opinions on the economy LOOK at were we are at today IN THE TANK! Not only has the economy been at its lowest in 100 years and i know nothing about economics other than knowing you need to be aggresive at trying to make a buck and you usually come out on top. Today that does not even work!!

It saddens me to see so many companys and individuals falling like donimos!! When will it end? or better yet will it end? Every day when i sit down to watch the news its another failure either through natural disaster or some company that WE thought was sulvant is gone belly up. Every day its more of a struggle to stay in buisness either because of fuel or people just are not spending any money! Every one is SCARED because NO ONE knows what tomorrow is going to bring. All these financial institutions i thought had the best minds that money could buy boy was i WRONG on thinking that!! Looks like the best spot for your money is in your Mattress! Sorry to be so hard on myself and those skeptics but remember i TOLD you this was coming!! Respectfully Papanasty :confused: :confused:

[SusieAndAl]

Hey Papanasty,

Well, is seems the vast majority of folks on this board agreed with you from the start as did we. The really big one to watch is AIG. The reason is its unbelievably huge involvement in the derivatives and secondary commercial/paper reinsurance markets. Now that its credit rating has been downgraded (duh now there's an ugly story) its cost of borrowing will go up and given Lehman's troubles it will have to downside its mark-to-market values on its "assets" which will have a global domino effect.

So, if AIG goes under, hold on to your hat. If it survives, we're all still in for a bad year at least and probably two.

Cheers -- SusieAndAl

[BahamaAngie]

You know my husband has been saying for well over a year....the bubble is going to burst....maybe longer before the gas prices rose. The way houses were being put up there and I don't mean houses, I mean mcmansions with huge vehicles in the driveways at least 2 and being so young. When we were married with young children, we were fortunate to have a new home, a summer home and a new car BUT most of my friends were struggling to buy homes or to buy "normal" type homes. I think everyone jumped so quickly. It use to be you would save for your dream home not start in it! When the mortgages got so overwhelming....bingo! The gas situation does not help. And I may be incorrect, but I blame the government for allowing this gasoline to have escalated as it has. I think it could have been worked out. Am I incorrect, uninformed or what?

[BahamaAngie]

Correction, I mean houses being put up here and of course eveywhere! You can't take a drive and feel like we are among the rich and famous!

[BahamaAngie]

Also, I am concerned about spending if things continue to get worse. I was saying last night about vacationing. I wonder if that is going to take a hit soon too. I would think.

[Watercolours]

So far our reservations for our cottages and boats have been good for fall 2008 and spring 2009 But our eyes are wide open watching. We are happy we only have a few cottages a few boats not fleet and and a resort with the possible upcomings.
I think this slow down could be good for everyone as we will have time to reflect and do a better job than we already do at whatever we do.
www.watercolourscottages.com (http://www.watercolourscottages.com)
www.cruiseabaco.com (http://www.cruiseabaco.com)

[South Pause]

Hey Papanasty,

Well, is seems the vast majority of folks on this board agreed with you from the start as did we. The really big one to watch is AIG. The reason is its unbelievably huge involvement in the derivatives and secondary commercial/paper reinsurance markets. Now that its credit rating has been downgraded (duh now there's an ugly story) its cost of borrowing will go up and given Lehman's troubles it will have to downside its mark-to-market values on its "assets" which will have a global domino effect.

So, if AIG goes under, hold on to your hat. If it survives, we're all still in for a bad year at least and probably two.

Cheers -- SusieAndAl


Apparently Paulson is opposed to bailing out AIG. It would take "billions", according to MSN Money. Wonder if lowering the interest rates, which will likely happen shortly, will just be a band-aid. It's pretty frightening and it's just beginning...

[SamFamAustin]

Agreed, some specialty markets - such as Watercoulours and rentals in the out islands of the Bahamas - are doing fair to middling, no big deal except rising fuel, food, and related items.

What worries people is that in the big picture, we thought that maybe the mini-recession (or whatever you call it) was about over, and signs of growth and recovery were becoming evident. Oil prices were headed down, for example, a nifty concept for a change.

Then last weekend, three major Wall Street financials went on the blocks. The Fed indicated that they would not bail out Lehman Brothers as they did Bear Sterns. Companies having 600 million in securities were traded off for 50 billion in fire sales. This doesn't really mean much to the common person.

But yes it does, too. Many will lose their jobs in the Bos-Wash area, adding to unemployment and foreclosure rates - things we know about because it affects real people. This could result in more "bad paper" ending up in banks, many of which trade together, possibly causing more financial institutions to fail.

Not a happy prospect but it could happen. It's not like the Great Depression where one day the stock market tanked. This is like a slow moving virus.

Interestingly, who is elected for US President next could affect the market psychology, although I don't understand it am an NOT trying to be "political" here. Basically what happened was the Fed turned its head on these very complex financial instruments - apparently they're complicated as a bassoon or something because nobody can explain them to the common person. CDO's, mixed derivatives, naked short hedges, yikes, sounds like a really bad Nippers experience! :eek:

-sammie

[Coz]

You know what's really sad is that the people running these failing companies didn't manage risk properly to avoid this mess, or at least mitigate the impact like some firms did. That's their JOB, but they were blinded by the piles of money. Sadly the tax payers and public get to deal with the fallout. The whole housing industry was drunk for years, giving money to anyone who asked. Creating ways for people to get more money than they had any right to. I just hope there are some real changes after all this is over. And I don't mean more government involvment, they have contributed greatly to this mess... Fannie May, Freddie Mac.

But hey, oil is down to $92! Maybe gas will follow after the mess from Ike is cleared up.

[BahamaAngie]

I too, am concerned for job losses. Then it could snowball. Let's hope for the best!!!!

Sammie, you still make me chuckle!

[papanasty]

One of the things that bothers me so much is if some one like myself can see the writeing on the wall back in April why did it take so long for these institutions to fail the way they did? they had to know it was coming and they just continued to operate like there was nothing wrong untill the bitter end! Are they a victum of the bad economy or was it just bad management and greed? I'm really trying to understand this because back when things started to decline i have been constantly making adjustment to what i do to balance out for the the hard times and it would make sense for these large financial companys to do the same to try and stay solvent. But its like they just ignored the reality of the situation and every day was buisness as usual!!:confused: :confused:

[BahamaAngie]

You make a lot of good sense Papanasty.

[cookie909]

I wonder how many 2nd homes in Abaco are being affected... there is so much building going on and some of the homes are HUGE. Does anyone have any statistics on this? Do they have foreclosures in Abaco???

We are getting a few abandoned pets due to home foreclosures here in Georgia. We just pulled a litter of 5 chihuahua-cocker spaniel mix puppies, only 6 weeks old, owner turned into animal control. (Cockerchis? Chicockuas? Hmmm...)

[gazeboman]

they had to know it was coming and they just continued to operate like there was nothing wrong untill the bitter end! Are they a victum of the bad economy or was it just bad management and greed? :confused: :confused:

A close friend of mine is a ceo for one of these failing companies. He has a golden parachute (or is it platinum?) which takes care of him no matter what happens!!! So he just kept making the wrong decisions in a way that benifitted him and others in the company! He admits this! He also says that there will be more accountability for people like him in the future! Someone should pack those parachutes in a way so they fail to open!!:eek:

[papanasty]

Absalutely! Thats the problem with these CEO's there set in there positions BULLET PROOF so they just do'nt care who's standing in the bread line when the hammer comes down they just pack up there S*** and go play golf for the rest of there life!! They definetly should be held accountable for there bad management! The sad part is some one else will put them right back into another position with another company the next day with the same severance packages etc. and they will probably do it again with out any concern for who it affects. Man i wish i could find a job were it does not matter if you do a good job or not and you still come out on top!! I do'nt know how they can sleep at night! Papanasty :eek:

[gazeboman]

The sad part is some one else will put them right back into another position with another company the next day with the same severance packages etc. :eek:

That is unlikely to happen to any great degree. Parachutes are becoming a thing of the past. Future ceo's are are unlikely to be "bullet-proof". We need to put a few of them in jail!!

[Long Look]

To put a CEO in jail requires that they break a law. Ethics is not law, and many of them just acted unethically. It will be interesting to watch for shareholder lawsuits in the coming weeks/months.

[Munter]

One of the things that bothers me so much is if some one like myself can see the writeing on the wall back in April why did it take so long for these institutions to fail the way they did? they had to know it was coming and they just continued to operate like there was nothing wrong untill the bitter end! Are they a victum of the bad economy or was it just bad management and greed? I'm really trying to understand this because back when things started to decline i have been constantly making adjustment to what i do to balance out for the the hard times and it would make sence for these large financial companys to do the same to try and stay solvent. But its like they just ignored the reality of the situation and every day was buisness as usual!!:confused: :confused:

This is mostly the fall out of the subprime mortgage debacle, lack of proper banking regulations and totally inadequate risk management, not to forget an accommodating interest rate policy. I think one can hardly blame the "greed" of the common people...they were only given crumbs of the American dream (in the shape of what turned out out to be unaffordable housing proffered by people who got undeservedly rich in the process). Also over the last 20 years or so the tendency of economic and financial policy makers has been to correct or even preempt the consequences of bad economic or financial behaviour. Much discretionary and haphazard policy making has been going on. A lot of people have been talking about the "bubble bursting" for ages. In any case we are so saturated by the media and experts talking about this that we can hardly claim that "we" saw it coming. It's been like graffiti on walls for everybody with any conscience or economic notion to see. But acting upon it is a different story. They say cancer can be cured by laughing, but mostly it takes radical treatment, and unless it can be removed, it will fester, sometimes slowly, or else rapidly. The financial companies saw this coming a while ago but when the cookie crumbles, the easiest way out is chapter 11 - screw the creditors, the investors and the common people in the US and elsewhere. It must be difficult to look down when you're on a high roll spending other people's money.

I also think that these funny instruments that Sammie referred to are to blame for ducking natural cycles or bad investments or irresponsible risk takers.
Unlike you, Papanasty, the American people have a very poor savings record and have got used to easy credit and being bailed out or outright subsidised. Nobody can live on credit forever and somebody has to finance it. There is one macroeconomic fundamental that needs correcting. (China is already getting flack for supposedly bank rolling the unsound mortgage market). Mega profits and CEO salaries in the past have come home to roost as mega losses. There is some justice in that. Most of the tens of thousands who are loosing their jobs now (Lehmann et al) are after all people who got fairy tale rich quick off the unsuspecting, and flaunting it. Though many more innocent bystanders bear the brunt of it.

The assumption has been that "we are untouchable, and don't need the rest of the world." Not exactly exemplary for the leading market economy to whom the rest of the world looked up to for guidance and strength. I can't help but be mildly amused by the rantings about the fairly recent rise in US fuel prices, for example, when Europeans have been paying a $ per liter or USD4 per gallon for donkeys years. Was that stupidity on their part or a more realistic attitude towards a scarce and non-renewable resource and the price that commands.

The fallout from this is far from over, and if I remember correctly, AIG was in trouble a while ago, so, yes, that's going to be a kicker. This is a long overdue wake up call, for the US and the rest of the world. Policy makers need to remember economic fundamentals, regulations need to be tightened and the real estate industry needs to stop preying on prestige soaked buyers because those fantastic property prices inevitably have a knock-on effect on other values. Even Abaco (and second home owners), supposedly impervious to the fluctuations in the US housing market, and where property is valued and hiked up often willy-nilly without reflecting real market values, will be hard hit. If houses triple in value over two or three years, there's something wrong: it creates a false notion of wealth, which in turn spawns irresponsible spending, most likely back in the US. I hope the inevitable blame game actually brings to justice the real perpetrators and restores a real sense of value.

I trust that Abaconians are more precautionary and resilient in the vein of Papanasty, just because island living and hurricanes make survival more real for them. Let's hope the super rich tide them over until this burst bubble is reflated.

[Stone Malone]

Don't panic lads

[SamFamAustin]

Gosh, this is starting to read better than the Economist, one of the better international mags.

You know, a simple cash economy with simple banks having checking, savings, loans, and mortgage functions is where it is at. Perhaps most Bahamians are like that, although I hear the Swedes are mainly a cash economy as well.

Maybe I'm not saying it right, "simple cash economy," but here's my point. My mortgage was contracted on a certain date with a certain bank and we started making payments there. Then some bozo flipped our mortgage and sold it to another company, so I was sending money somewhere else. It flipped one more time and I'm sure that was just a holding company to bundle buyers just like me into Triple-AAA securities of dubious nature ... gee, somewhere ethereal or ephemeral. All I know is they get testy if I'm late on the monthly payment.

Insurance was stranger. I have a company and they love my checks, got all the stuff in one account for cars, houses, and neckties. But wait, they're reselling my insurance and then have the unmitigated gall to buy insurance in both case me and them default!

That's called re-insurance. You can insure about any risk markets as well, technically called boogedy-boodegy I think. Anyhoo, AIG does all this hidden kind of stuff, the world's largest aftermarket insurance company in the world, bigger than Lloyds or anybody. If you want to learn more about boodedy-boogedy, try to file a nice fat insurance claim and see what happens.

Stay with me folks, there is one more step! When large disasters happened such as Hurricane Katrina, the insurance company was stingy because it put pressure on the re-insurance companies to pay up on the gamble. That is how the major insurance companies made more money than ever during the Katrina debacle. The re-insurance company simply re-packed the debt paid out and marketed them as securities having value. I kid you not.

The second thing that happened with re-insurance is that the re-insurance companies said "we have to raise premiums to insure your junk, and you'd better start bailing from the coastal market." We all know that trick. -sam

[flyingdogs]

OK this should explain the situation, just click on it to go to the next page.

The Subprime primer (http://docs.google.com/TeamPresent?docid=ddp4zq7n_0cdjsr4fn&skipauth=true&pli=1)

[BahamaAngie]

Wow!

[Munter]

Flyingdogs and Sammie - great illustrative underpinnings!!

Barely four months on the job.............An item in today's NYT caught my attention, "Robert B. Willumstad, who became A.I.G.’s chief executive in June, will be succeeded by Edward M. Liddy, the former chairman of the Allstate Corporation (http://topics.nytimes.com/top/news/business/companies/allstate_corporation/index.html?inline=nyt-org). Under the terms of his employment contract with A.I.G., Mr. Willumstad could receive an exit package worth as much as $8.7 million if his removal is determined to be “without cause,” according to an analysis by James F. Reda and Associates." No comment.

[papanasty]

Hey Flyingdog great illustration! Simple and to the point Papanasty :cool:

[SamFamAustin]

If there's any consolation, crude prices are heading may down. If it weren't for Hurricane Ike, gasoline and diesel prices would have been falling. I think it was below $92/bbl yesterday. Some economists predict something in the 70's although nobody has a clue. Refineries should be back online in about a week, with about a two-week turnaround (translation: lotsa fuel).
http://www.icis.com/Articles/2008/09/16/9156440/us-refineries-pick-up-pieces-after-ike.html

It turns out that "it's the economy, stupid." The housing bubble lead to the financial bubble lead to the energy bubble and now all three are headed south. Less global purchasing and consumer demand means less fuel.
http://www.washingtonpost.com/wp-dyn/content/article/2008/09/17/AR2008091701185.html?hpid=topnews

Analysts and Tiki bar observers feel that lower fuel prices are a good thing, although it could have consequences like:


less demand for clean, hybrid vehicles if gas prices sink
less capital for all those nice offshore oil wells we want
less incentive for alternative fuel makers (ethanol, bio-diesel)But remember, oil, gasoline, and distillates are not used for electric power generation, so I predict electric rates will continue to surge. Not only is electricity more expensive, but the infrastructure to route the power - all those high tension lines and huge towers - are literally falling down, something built more for the 1970's. Hurricane Ike proved that point by knocking out 8 main transmission lines to Houston and leaving 2.2 million people in the dark.
-sammie

[Henz]

well, my 2 cents is basically that the US economy runs the rest of the world. We are the greatest country in the world. If our economy declines, so is the economy of the Bahamas..Less tourism, less number of second homes etc.. Its all just a trickle down. I jsut wish that we would stop importing so many things that we can make right here. that drives me crazy

[BahamaAngie]

I agree!!!!

[Charlotte Couple]

If you want a really good explanation of the subprime mess, and how it came about, listen to this program recording from This American Life. It takes about an hour to listen to the whole thing, but I haven't seen or heard a better description, some of which is directly from people who were involved in creating the debacle. Plenty of blame to spread around, and it boils down to a lot of greed, and almost no accountability all along the line.

Click on the link below, and select the podcast called "The Global Pool of Money". You can listen to it online for free, or you can download it to an iPod or order a CD of it. Well worth the investment of time to listen to it, which I did from a friend's iPod while traveling in the car.

http://thislife.org/Radio_Archive.aspx

[SamFamAustin]

well, my 2 cents is basically that the US economy runs the rest of the world. We are the greatest country in the world. If our economy declines, so is the economy of the Bahamas..Less tourism, less number of second homes etc.. Its all just a trickle down. I jsut wish that we would stop importing so many things that we can make right here. that drives me crazy

I think it might be better to say that the days of America commanding the global market are coming to an end. Other countries such as China, India, Brazil, and the USSR are increasingly flexing their muscles and exerting control of global markets. I agree to the extent to mean that the US can drag down foreign markets in the wake of its self-destruction.

Of course it is not all gloom and doom, and the guv'mint will print more money to stimulate the economy and reign in the wayward financials who got us into this mess in the first place. Times just aren't great like they used to be, and America seems to have lost its power to expand and stimulate global economies for the good. -sam

[BahamaAngie]

But you don't you think it was a little unrealistic? The big homes, big cars, big lifestyles at such young ages? Use to be you saved for that! I had heard that a lot of them could not even afford to furnish those mcmansions???

[DrRalph]

I think it's time that we Americans accept that we cannot exist indefinitely on relatively low taxes and an annual budget deficit of $400 billion. Our $multi-trillion debt is a weight that drags our government at a time when it has to spend billions to rescue giant essential institutions. At some point we're going to have to pay the piper; it's going to hurt, but it has got to happen.:(

[Henz]

yeah, and all of those other countries that are coming up in the world are due to the fact that we got them there by purchasing all of their damn goods. Tell me that the US doesnt purchase the highest amount of goods within one country over another. I doubt that it happens. Take away all of that and see what happens to those countries. And by no means am I bashing any other country, its jsut the way that I see it. I would like to see the breakdown of that 400 billion dollar debt. cause I love to watch our government bail out other countries all the damn time!

[bahamajb]

I hope this isn't political, I think it's common sensicle. When more people work in the public sector than do in the private sector it's unsustainable..................................jb

[SamFamAustin]

I see your point but it might be besides the point, which is clearly indicated in this graphic from the NY Times:

[FarmerBob]

Ole Tom Jefferson pretty well had it pegged many years ago:

"Government big enough to supply everything you want is big enough to take everything you have."

"The democracy will cease to exist when you take away from those who are willing to work and give to those who will not."

[Alan Brown]

Mismanagement. Isn't this what gets most corporations into financial trouble? Isn't this what gets us all in trouble; bad decisions, coupled with arrogance and stupidity, resulting in more bad decisions?

Everyone is correct to point fingers at the CEOs and the golden parachutes they negotiate into their severance packages. What is their real incentive to succeed when they can run their companies into the ground, then walk away with more money than most of us could ever envision. Shame on them!

BUT, who approves these severance packages? The company's Board of Directors. These folks are responsible for overseeing the CEO, but as long as they get their monthly pay-off, everything is copacetic. They risk nothing and if the company goes belly-up, they're usually financially well enough off not to miss their board member stipend. Heck, they may not even be asked to give up their Board seat!

Now, in the case of Lehman Brothers, the Board thought that their CEO was doing such a fine job that they awarded him a $22M bonus this spring. As I recall, most of his Board members were former big shot CEO's. So Dick Fuld screws up to an AMAZING degree, yet walks away a multi-millionaire. This is what's wrong with Wall Street, no accountability!

How about we hold the Board of Directors accountable for the performance of the CEO they hire and "oversee". Let's require them assume personal responsibility for "their" CEO's bail-out if things go south. Just watch how things change when the "good old boy" board members actually have to take an active interest in the the company they are paid to oversee. Golden parachutes will soon be woven of nylon.

Why am I not holding my breath for something like this to happen?

On a personal note, my employer has just gone under. Foreign ownership, which used us as a cash cow, inept and arrogant leadership, a complacent board of directors, and a slowdown in the economy all conspired to bring Barbeques Galore to its knees. We should prove to be an excellent case study for future MBA students who want to learn what "not to do" when running a company. By the way, I understand that my CEO was able to sell up to 40 of our 65-store chain to a major Taiwanese grill manufacturer. For his efforts, he received 1.5% of the selling price, or so I've been told. The employees got nothing, not even payment for our unused vacation time. Ain't life grand!

[Beer Baron]

Farmer Bob:
I couldn't agree more with the first quote. I think we're a little late on the second one.



Stock Broker comments:
1999: Holy **** the DOW's @ 10,000!!!
2008: Holy **** the DOW's @ 10,000!!!

I think that we should just allow the US economy to COLLAPSE - and I do mean completely. I am absolutely infuriated that I will be footing even a portion of the bill for the indiscretions of these reckless spenders on wall street. If they've lost your money, I feel for you. But let them try to recoup YOUR money, not bail them out with mine. I work too dang hard for mine to see it spent bailing these morons out.

Financial markets are a ALWAYS a gamble. If you bet and lost then you'll just have to pull yourself up by the bootstraps and try again, there bub. Invest in a winner next time around.

After calculating today's losses, it looks like I won't be seeing the Bahamas until we elect the next president. No no, not THIS election - I mean the NEXT one. :mad:

[SamFamAustin]

Good point Beer Baron ... and the market will go wherever it wants as long as there is softness in the real estate market. As long as more than half of the market in LA, Florida, and other hots spots are valued lower than the mortgages are worth, the nation will be bleeding red ink. Is Bank of America next, with that pornographic acronym BoFA?

It is an ancient Chinese curse to say "may you live in interesting times."

[180degrees]

There hasn't been any mention of how the US economy is impacting, or not impacting, Bakers Bay. Have there been any reports?

[JersAbaco]

It's time to rebel once again

www.fairtax.org (http://www.fairtax.org)

[BahamaAngie]

Actually, I just posted something which probably should be under this thread instead of wondering if any specials will be offered with the ecomony being so yucky.

[theKurp]

I think it's time that we Americans accept that we cannot exist indefinitely on relatively low taxes and an annual budget deficit of $400 billion. Our $multi-trillion debt is a weight that drags our government at a time when it has to spend billions to rescue giant essential institutions. At some point we're going to have to pay the piper; it's going to hurt, but it has got to happen.:(



Before I resign myself to paying higher taxes, and thus, tightening my spending, I want visible and viable proof that the U.S. government is doing everything it can to eliminate wasteful spending.

[theKurp]

It's time to rebel once again

www.fairtax.org (http://www.fairtax.org)

Uh oh! :D

[islandfever]

Aren't those the wackos that wanted to invade the Abacos and create an independent nation or something? Bunch of disgruntled Florida fishermen? :eek:

You might want to read Steve Dodge's "History of Abaco." You may have just offended many Abaco decendents of the legitimate independence of Abaco movement.

[SamFamAustin]

IslandFever - sometimes being a funny-man just don't work, so I nuked my message. Thanks for pointing that out to me. -sammie

[islandfever]

IslandFever - sometimes being a funny-man just don't work, so I nuked my message. Thanks for pointing that out to me. -sammie

I recommend reading that section of his book on Abaco independence. The movement was led by many of the prominent families. Their primary goal was to remain loyal to the Queen and under the UK as they had always been. If not this they wanted independence. They even went so far as to have a flag designed. I get a kick out of hearing the story personally from a still living gentleman of the movement who said they even very briefly considered armed rebellion. However, after considering that most of them were over 40 years old, they figured they were too damn old to fight. They reluctantly gave in after taking their request all the way up the courts in England and being turned down. This left a hollow feeling after a proud 200+ years of loyalty to the crown.

[Watercolours]

[quote=islandfever;3564 they even very briefly considered armed rebellion. However, after considering that most of them were over 40 years old, they figured they were too damn old to fight. They reluctantly gave in after taking their request all the way up the courts in England[/quote]

There were practice missions for the militia in the Pine Forests just south of Snake Cay. Some of the guys involved are now about 60 something years old as this about thirty something years ago I think. This was after independence and was mostly a movement to separate Abaco from the rest of the Bahamas as an independednt country with stronger ties to the crown. This is just what I have from hear say. Patti and I were very young sailors then and were in Hopetown some in the late seventies and heard of this at that time and other drables since. I would not swear on my info as it is hearsay and from years back.
www.watercolourscottages.com (http://www.watercolourscottages.com)
www.cruiseabaco.com (http://www.cruiseabaco.com)

[Wonkee]

I know many of the Abaconians that were part of the "movement" and their story is much different than the story that is in the Dodge guide. To say what I have been told would be simply hearsay so I will allow an Elder of the Abaconians on the board say what really happened. Just know that many atrocious acts took place. that is why the militants were brought in.

[Wonkee]

Why has no one mentioned that the dow rose 410.03 points yesterday. An economist on TV last night said" "We are not in a Recession, but we are in danger of talking ourselves into one." meaning simply this is a rough patch that we are going through and everyone is being driven by fear, even though we are not in a recession we continue to act like it and if you act like a victim long enough you become one. We would have to drop over 8000 points in one day to match what happened in 1929, and over 3000 in one day to match the 70's crash. we are freaking out and making the little splinter in our hand look like our hand is getting cut off. stop and reflect.

[Wonkee]

hey just read where it jumped 357 points today, making it the highest 2 day rise in over 8 years... yep toilet....

[gummy67]

Let us all remeber it is an election year and the opposing party will do anything to discredit the current party.

[Marty]

Very little to do with politics in the current economic situation. The reaction to it on the other hand is very much political.

I feel an economic chat coming on........anyone up for it??

Still chatting.....

[SusieAndAl]

hey just read where it jumped 357 points today, making it the highest 2 day rise in over 8 years... yep toilet....

Hi Wonkee,

Just curious. About five months ago I closed all my long positions, bought high quality paper from GE and IBM; invested in Euro bonds. Then I went short big time against LEH, FNM, C, ML and a few others. I closed those out on Monday with a huge gain on which I will have to pay tax (a problem I'm very happy to have).

I will wait until I see what the "bailout" details are to see where I invest my money. I'm currently inclined to buy BAC for the long term because I think when the dust settles it will be the clear winner, but I'm more than open to other ideas.

What are you doing with your money?

Cheers -- Al

[SamFamAustin]

Stuffing the mattress? Giving it away as fast as possible to the kids? I dunno, I lost $50,000 in one day, Black Monday, 1987. These were stocks very well planned as "long time keepers" and most were started as untaxed "gifts to minors" when I was born. Talk about 1956 heirloom paper! Occidental! Atlantic-Richfield! They all poofed, of course.

At the same time the Savings & Loan crisis hit Texas and we were upside down on our mortgage as a result. So I cashed every single one of the notes and T-bills just to survive with two babies. I refused to play the game ever since, aside from losing my ESS on my 401(k) plans - which we recently cashed out as well. Houses did OK until recently, though.

Sorry, not a pleasant topic with me.

[DrRalph]

NEW YORK (CNNMoney.com) -- President Bush has asked Congress for the authority to spend as much as $700 billion to purchase troubled mortgage assets and contain the financial crisis.

The legislative proposal - the centerpiece of what would be the most sweeping economic intervention by the government since the Great Depression - was sent by the White House overnight to lawmakers.

President Bush said Saturday that the plan matches the scope of the problem.

"It is a big package because it's a big problem," he told reporters at a joint news conference with Alvaro Uribe, the president of Colombia.

"The risk of doing nothing far outweighs the risk of the package," Bush said.

Treasury Secretary Henry Paulson, lawmakers and their aides are expected to work through the weekend in an effort to craft a bill swiftly. Democratic leaders on Capitol Hill said they expect the bill to go before a vote within days.

Paulson, Federal Reserve Chairman Ben Bernanke and other officials have said in recent days that the lack of easy credit between banks and other financial institutions threatens to inflict serious damage on the economy if not addressed immediately.

Just a few comments:

Notice this is the federal government's most sweeping intervention relative to the economy since the Great D-word!!!
We don't have $3/4trillion, where is that going to come from?
This comes after the government has already had to bail out AIG, Fanny Mae and Freddie Mac.
What happens next week?:eek:

[Charlotte Couple]

I just went back through this thread, and here are a couple comments:

1. You didn't really lose $50,000 in one day, unless you sold the stocks at the low point. As illustrated Friday, stock prices will usually rebound, so hold onto them for awhile. If you DID sell them then, I assure you that whoever bought them will do well in the long run.

2. Sammy, I admire your wealth of knowledge on a very wide range of topics, but I think you're a little off-base on the subject of insurance. I've been in the business over 30 years, and I know a little about it.

Reinsurance has nothing to do with "re-selling" your insurance. Unlike selling mortgages, an insurer that writes a policy for you cannot just sell that contract. An insurer buys reinsurance to lay off some of their overall risk, so that a single catastrophe won't hurt them as badly. For example, say Travelers writes a policy for a $100 million building. They might buy reinsurance to cover any loss that exceeds $25 million, but they are still responsible for paying the full amount of their policy to the building owner, if it is destroyed. They then file a claim with the reinsurer to collect $75 million from them.

3. In my experience, insurers are not stingy after a hurricane or other major natural disaster. They usually are more prompt and generous in their settlements, dispatching teams of claims adjusters, who write checks to their customers on the spot. They know the press is watching, and they want to get good PR by taking good care of their customers when they need it most.

The bad press from Katrina came from Flood claims. HOMEOWNERS POLICIES DO NOT COVER FLOOD! Any reputable agent selling property insurance in coastal areas will tell his clients they need to buy coverage from the National Flood Insurance Program. The problem is, many people don't want to pay the additional premium to do that, so when their home is destroyed by storm surge, or inundated by water from swollen rivers, creeks, etc, they complain that they didn't understand that, and their Homeowners' policy should pay the damages. Haley Barbour basically said the same thing, and pledged to "make the *******s pay", or words to that effect, but the insurers are right to fight those claims.

The NFIP exists because Flood coverage is only purchased by people who know their property is at higher risk for flooding that most properties. There is no real spread of risk among a large pool of policyholders, as there is with Fire, Theft, and even Windstorm.

[SamFamAustin]

Well you got one thing right - I'm no financial whiz in the least. I just got burned real bad in the past, mainly because bankruptcy. So now I watch in horror as yet another bubble bursts. Perhaps I shouldn't expect anything different in this "boom or bust" nation.

And I didn't mean to insult those that work in insurance in the least. I can note that because of Ike, the Texas Windstorm Agency (insurer of last resort) is currently in default and Legislature must prop it up - not the fault of the industry and in fact, insurers may absorb some of those costs ... and raise our rates. I guess I simply don't understand the complex world of how lines of credit risk like CDOs are "insured" by hidden financial giants, and that many of those companies are teetering on insolvency. All I know is that this industry really isn't "insurance" as the man on the street would know it.

As usual, I don't mind a bit if my line of BS is corrected, since I'm always learning ... cheers,
sam

[Beer Baron]

**Checks forum location**

< Rant >

I would be slightly more in favor of this bailout if the figures below didn't make me so ************* furious.

Individual earnings during 2007:

Goldman-Sachs: In 2007, Lloyd C. Blankfein raked in $70,324,352 in total compensation according to the SEC.

Morgan Stanley: In 2007, John J. Mack raked in $1,602,458 in total compensation according to the SEC.

Meryl-Lynch: In 2007, E. Stanley O'Neal raked in $24,306,586 in total compensation according to the SEC.

JP Morgan Chase: In 2007, James Dimon raked in $27,797,275 in total compensation according to the SEC.

Citigroup: In 2007, Charles O. Prince raked in $15,105,376 in total compensation according to the SEC.

WaMu: In 2007, Kerry K. Killinger raked in $5,250,770 in total compensation according to the SEC.

Lehman Brothers: In 2007, Richard S. Fuld raked in $34,382,036 in total compensation according to the SEC.

AIG: In 2007, Martin J. Sullivan raked in $14,330,736 in total compensation according to the SEC.

Bank of America: In 2007, Kenneth D. Lewis raked in $24,844,040 in total compensation according to the SEC.

As a whole, we need to lean back, and let these institutions burn to their foundations. They've made their collective beds and now they're crying about having to lay down on them. If they didn't want to lose their precious millions, they should have been more responsible with our money.


Let the tax payers decide if they want to invest their money in this debacle when they can get a conglomeration of Citi, WaMu and BoA stocks for $.40/share. Until then, let the DEPRESSION (yep, I went there) begin. Personally, I think the Great Depression of the 1930's contributed to toughening up our contrymen for the darker days ahead in the 1940's.

Nowadays, we just pat these companies on the head and tell them "Big Brother's gonna make it aaall better by kissing their boo boo's with nearly 3/4 of a trillion dollars".

Nevermind that we really don't know where we're going to find that kind of cash to bail them out with. Nevermind that the SEC allowed 5 financial institutions exemptions on filing their debt/capital numbers in 2007. Nevermind that 3 of those 5 have since gone belly up within the span of the last year (and you can bet your sweet bippy that the other 2 are concerned). Nevermind that our government has decided privatization of earnings is good and that socialization of loss is even better (for them anyway. for me and you? Not so much). Nevermind that financial responsibility is a thing of the past.

The sad part is that as long as American Idol is still on the air, people can still hop into the SUV and head down to the local Burger King, NOTHING will ever change.

< /RANT >

So how's everyone here faring through all this?

[Long Look]

Man, John Mack at Morgan Stanely needs to negotiate better... only 1.6 million per year? How can a man live off that? His peers seem to be doing a much better job.

[Charlotte Couple]

Actually, there's a proposal to include limits on CEO compensation as part of the bailout, which I think is a good idea, if the limits are set at the right level.

Although I favor free markets and minimal government, I am in favor of the bailout, because too many people who were NOT directly involved is wrongdoing or poor judgement will be hurt badly if we don't step in. If the buyout of questionable/bad loans is done at fire sale prices, the government could actually profit from the mortgages in the long run. That is the opinion of a very sharp economist at UNC Charlotte, John Connaughton. That is what happened in the S&L bailout some years ago.

[SamFamAustin]

I agree that something has to be done, although the idea of giving away 700 clams seems repugnant to me. Why not just free up lines of credit and offer loans to be paid back? The financials can use the money however they want, and even pay those nice fat bonuses and salaries. But it seems weird for the government in the business of buying and selling commercial paper. Traditionally, such efforts were done by independent corporations (though backed by the government) such as Fannie and Freddie.

I guess I keep learning. The first thing I learned was that nobody knows how much money would be "sunk" in rescuing the financials. Presumably, the Fed would buy paper at something like 75 cents on the dollar and sell it off at something like 50 cents on the dollar - under the current thinking. So the taxpayer would lose 25 cents and the value of the note would be written down 25 cents as a market loss (not a taxpayer loss). No so simple in reality, but perhaps that makes some sense.

Freeing up liquidity would be a little different. Here, massive amounts of taxpayer money would be used for long-term (not overnight) loans at something like 2%. This might minimize the risk to the common taxpayer and allow the market to evolve on its own.

On that last idea, the US has been preaching to other countries to do exactly that. If a foreign country is in trouble, it was like "let the banks sink, devalue your currency, and let the market find its footing." Now it sounds like we're not taking our own advice ... but what do I know? These are very strange times. -sam

[HALF-A-HAMIAN]

And the Rockefellers still make money the old fashioned way..........they print it.

[Wonkee]

Gold. When I have spare money, I buy Gold. It has never gone to zero, and doubt it ever will. It may devalue for short periods but is a great long term investment. What I bought 10 years ago has more than doubled in value. I do have some in various Mutual funds, but that money is managed by a board of directors that is the only approved fund that my Employer uses currently so it is in what ever they decide for now. Since my employer, that would be those of you who pay taxes, matches 100% up to 5k a year I figure Ill take the free money.

[Alan Brown]

Let me ask a couple simple questions.

Weren't all these sub-prime mortgages used to purchase a piece of physical property, like a home?

If the borrower defaults, doesn't ownership of the property now transfer to the lender?

If the lender is able to sell the property it has foreclosed on does this mean he has recouped all or part of his loan money?

Finally, if the lender is able to recoup all or part of the money borrowed, how can the loan be worthless?

What has me confused is that it seems that the holders of all these sub-prime mortgages are treating them as worthless and want the government to take them off their hands.

OK, lets buy them for at 10 cents on the dollar, separate out the good mortgages (the ones not in default) and dispose of the secured properties (homes) for a whatever the local housing market will bear. Wow, could the U.S. government actually make money on the deal? Heck, I'll even buy a bundle of "worthless" mortgage paper, cause I know if I dig deep enough, there's a pony in there!

[SamFamAustin]

Weeeell, we don't really know what happened, other than some kids went wild.

Take a mortgage. At a traditional mortgage company, savings and loan, or bank you have it exactly right. It still is that way (try NOT paying your loan). We know that even at a loss because of a sour housing market, you still can hold and sell the property for real good money.

What happened was the fancy-schmancy mortgage houses like Countywide were bundling together these individual home notes and working with another company to "repackage" them as securitized debt - invented negative money. I am not making this up.

Here's a silly example. Here's a head of regular iceberg lettuce. You can peel off some outer layers and wash it but you still have a that exact same head of lettuce. Now take a whole case of lettuce and run it through a giant salad shooter that chops it all up. Can you tell which head of lettuce is yours? Of course not.

All you get to ask is if you want the Cesar dressing, house vinagrette, or something else. :D
-sammie

[Patty&Rudi]

Subject: The Birk Plan


I do not know who Birk is, but this is one of the better economic stimulus
plans I've seen.

The Birk Economic Recovery Plan Hi Pals, I'm against the $85,000,000,000.00 bailout of AIG.

Instead, I'm in favor of giving $85,000,000,000 to America in a 'We Deserve It Dividend.'

To make the math simple, let's assume there are 200,000,000 bonafide U.S. Citizens 18+.

Our population is about 301,000,000

[abacobob]

$85,000,000,000 / 200,000,000 = $425.00

[JJ]

I think Birk needs to invest in a calculator.

[BahamaAngie]

Well, it did sound good, didn't it?

[Patty&Rudi]

It sure did to me!! :confused:

[Wonkee]

Technically most homes that are in default with the bank are also in tax trouble as well, and the Government holds precedence. That means that the Government technically owns them. In Kansas by settling the tax debt with the government you can obtain the house. So until the tax debt is settled it makes foreclosure very very hard. And even after a house is foreclosed on any outstanding tax debt is taken out. Which takes away from any recoup of funds lost. The truth of the matter is that they do not sell the houses for what the loan was for. it goes for pennies on the dollar. Now I like the Idea about buying the good ones for 10cents on the dollar and making a profit off of it.
Let me ask a couple simple questions.

Weren't all these sub-prime mortgages used to purchase a piece of physical property, like a home?

If the borrower defaults, doesn't ownership of the property now transfer to the lender?

If the lender is able to sell the property it has foreclosed on does this mean he has recouped all or part of his loan money?

Finally, if the lender is able to recoup all or part of the money borrowed, how can the loan be worthless?

What has me confused is that it seems that the holders of all these sub-prime mortgages are treating them as worthless and want the government to take them off their hands.

OK, lets buy them for at 10 cents on the dollar, separate out the good mortgages (the ones not in default) and dispose of the secured properties (homes) for a whatever the local housing market will bear. Wow, could the U.S. government actually make money on the deal? Heck, I'll even buy a bundle of "worthless" mortgage paper, cause I know if I dig deep enough, there's a pony in there!

[Patti Puzo]

That kind of reminds me of a similar scenario with my son-in-law. Forgive me if it is off base.
He is a Denver area police officer (soon to be Denver Firefighter), but had to work MASSIVE amounts of overtime for the D.N.C.
He received his paycheck for the overtime (almost double hours), and they taxed him and took all but 20% of the extra "income".:confused:

[SusieAndAl]

That kind of reminds me of a similar scenario with my son-in-law. Forgive me if it is off base.
He is a Denver area police officer (soon to be Denver Firefighter), but had to work MASSIVE amounts of overtime for the D.N.C.
He received his paycheck for the overtime (almost double hours), and they taxed him and took all but 20% of the extra "income".:confused:
Hi Patti,

Someone made a huge mistake. Please scan the stub, email it to me and I'm sure I can figure out what went wrong.

Cheers -- Al

[Patti Puzo]

Thanks Al... I will mention it to him. I thought it was pretty comical that he was assigned to protect government employees, and the government ended up taking most of his earnings.

[AbacoPeach]

Patti, you are a more tolerant person than I am. I would have been royally pissed!!!

[BahamaAngie]

She does seem to handle things well and with a relaxed way. My Italian temper would have been flaring....where is your Irish temper Patti? Which is being a hot head type A personality or B? Whatever I use to always be a hothead....the years have cooled me off!!!!

[SamFamAustin]

To heck with the economy, we need to protect our folks from wage and salary abuse! For hourly help time over 40 is 1.5 times the pay unless you have a contract that says otherwise. The state agency I worked at got caught hiring temps and doing the same thing ... it is more common than everyone thinks.

When I worked for the DOD on a job about 15 years ago, we figured we were making 10 bucks and hour. We passed a sign listing the "prevailing wage rate" for all workers on the jobsite. Hmm, $18.50 an hour for our kinda work. So we marched ourselves into the job shack and started WWIII ... shut the jobsite down, got paid tens of thousands altogether, and were quite satisfied. Block party!
sammie

[AbacoPeach]

Angie, for the most part, I am a pretty laid-back person. There are just some things that really get under my skin. Patti's son-in-law's situation happens to be one of them!

[BahamaAngie]

Yay Sammie!

That is nice to be laid back Peach, I never was...wish I was....but it is what it is!