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July 2007
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September 2007

Wizards and Treos and Gays - oh my

Been a busy few days, for a retired person. Or I should say a productive few days.

I got a little more caught up with the rest of the Harry Potter world finally. I saw the 5th movie with a friend last week and realized there was a lot I'd missed. Like books 3-5 and movies 3 and 4. I borrowed them all and spent a few brimstone tainted days. I still have to read Planet of the Snapes, and I think there's a movie I missed too.    

Latest techno-challenge was upgrading my Treo - from a 650 to a 700p. my Bell contract was due for renewal, which means a credit towards a new device. It's a corporate contract from my Bell days, 200 anytime minutes a month, 30 texts, call answer, message manager, all with debits and the best - unlimited data. For about $90/month, before the Bell retiree discount. However, when I went to upgrade at the Bell store, they couldn't put the data package on, turns out it's an old offering, no longer available. I guess now that so many have streaming audio and download lots of music and tones and images - unlimited audio adds up. I'd upgraded to PocketTunes deluxe a few months ago, which included Internet Radio. Surprising how much bandwidth a few hours of Goon Show Radio can eat up. I could  keep the old phone, or buy a new one via ebay - but when my contract ends, I would lose all the various discounts. I was annoyed. I decided to call Bell Mobility directly - good move. While I couldn't get unlimited data for the same price, I did get all the other features at the same discounts, plus more deals - sounded like he was pulling coupons out of a bag. So - a new toy useful device. Now I'm waiting for my Bluetooth keyboard to arrive.

Had a good outing last Sunday. I went downtown around noon to catch the Ottawa Gay Pride Parade. I was on Elgin, to catch the good light and have a good angle shooting up the street, and took a lot of pics. Then I went to the party in front of City Hall - was only $5, good entertainment, including the 2007_08_26_117a_small_2 lively B-girlz, and lots to see. Met a friend there, she seemed to know every second person that walked by so I met lots of fascinating people. We were there until dusk, then to a pub, then her place to chat with her daughter and friends. Luckily was close to my place, so I just had to walk home at 12, tired and tipsy. I have maybe 230 pics, and several videos. Some are posted on Flickr to one of the sets, I will add more in a few days.

Too much bacn?

Nope - not a typo. According to an article in today's Globe and Mail, while spam is still as ubiquitous as, well, spam, bacn is the latest thing clogging our in-basket. It's email that we do want, just not right now- things like Facebook messages, stock market updates, news bulletins, Google alerts. 

The term was first served up at a conference in Pittsburgh last week, and is already spreading through the Internet in a viral fashion, being written up in Wired and the Washington Post, as well as on numerous blogs. Here's an article about it at Boing Boing, as well as a link to a new bacn site.

Update - found a link to an earlier user of the term - Northrup Grumman.

Non-bank Backed Asset Backed Commercial Paper

What a mouthful - was funny watching news readers stumbling over the phrase. Apparently this is the "bad" kind of ABCP, the kind that's causing problems.

Last week the US Federal reserve board reduced it’s discount rate that it gives to the big banks – by 0.5 percent, to help slow the market slump. Opinions are that it helped. Another rate in the news is the federal funds rate – the overall lending rate between banks. It’s been the same since June of 2006, the next meeting to discuss it is September 18th. Speculation has been that they would drop that rate too, to help ease the current lending problems and boost the market. Due in part to that speculation, confidence has increased and the market improved - so maybe on the 18th the rate won't be changed - with another slight market drop correction.

The Globe and Mail had an interesting article this week (Aug 22) , by Barbara Ehrenreich- "Why America's poor rebelled - first they stopped paying their mortgaged, then they stopped shopping."  She talks about WalMart wondering where the customers have gone, she suggests their low wages to their own employees is at fault.

Easy credit became a substitute for a livable wage, hucksters push the latest toys at us all, we see it and we want it NOW. Consumers and investors will be looking for answers, for protection, for their money back Who's to blame - the rating agencies for the ABCP's , the institutes that packaged the consumer loans, the lenders, or the consumers. Stay tuned for class action suits.

ABCP -what's with that?

I learned last week that ABCP stands for Asset Based Commercial Paper - which means short term loans secured against assets like credit cards, car loans, and sub-prime mortgages. These are higher risk, and higher rates, so banks and third party lenders then use them as security for longer term loans somehow. I'm not sure how it's all related, but it turns out some of these assets are not as easy to grasp as they should be. In particular the sub-prime mortgages have been referred to as Ninja's - No verification of INcome, Job, or Assets. Verification used to be a big deal, but lately has been ignored more, as lenders sign up lots of new homeowners with brand new mortgages that they really don't qualify for. Many find they can now afford that new place since they have reduced (or zero) payments for the first year. And some are realizing a new house means you "need" more furniture, garden things, decorating, and that they still won't magically  have the cash flow for the payments. For many it's a painful reality, recent figures from the US are of increased foreclosures - 180,000 last July -almost double the year before. And if the homeowners haven't realized it yet, the people being asked to "buy" these ABCP debts are realizing it, with significant impacts on the stock markets. Big in the news last week was of Toronto based Coventree- their shares tumbled 35 percent after the company extended (couldn't fund) maturities on C$250 million of ABCP and sought emergency funding for another C$700 million of debt. They have about C$16 billion of ABCP outstanding, so this was only a part of their total, but enough to worry investors. The stock market had been rising well the first six months of this year. so well in fact that there have been a lot of warnings that it is too good to be true- stocks are over-valued, investors are paying too much in a rush for potential profits. So people heard of this ABCP issue, and it's related reminder of the shakiness of the sub-prime market, a lot of people decided it was time to sell those riding stocks and take a profit. So many sold that the TSX and other indexes dropped a lot last Thursday. Various governments pumped in some cash to slow the slide and dropped rates slightly - which seemed to convince people that there really was a problem - more selling. With the previous slide in July, the TSX ended up dropping to the same level it had last January - effectively wiping out 6 month's gains. Advice seemed to be to not sell, to just sit tight, or grab some bargains. Lots of funds did that. I had a stock that had been rated last month as still worth buying into - so when it dropped a few dollars I just bought more. The drop has stopped, but it likely will take several months for the markets to recover. Apparantly subprime mortgages make up only 5% of the mortgage market here compared with 20% in the US - must be our conservative bent. This implies that any increase in subprime defaults here will have a more limited impact on the our economy. However - if the US subprime defaults depress their economy - this WILL have an effect on us. 

This is all very fascinating to me. I've had some RRSP's for a while, some mutual funds via my corporation, but have just in the past year got into more mutual funds and stocks on my own. I talk to friends that invest, read the G&M Report on Business section (before the news section I admit), I now have their GLOBEInvestor Gold to track it all, and that lets me keep their Business News Network running live in the background. Great interviews, lots of tips - all of which sound good, so the challenge is to pick the ones that I think match my style, and that I believe will do well. A bit of a gamble, but I try to risk only as much as I would be OK to lose.