Southern Sojourner

A New Day

    Emerson was dropped off early this afternoon so her grandparents could go vote, which meant that I knocked off work early as well.  Not that I was getting much done. Having gotten my essential work done this morning, I was full of nervous energy, my minding wandering in anticipation of a night of election watching. 
    We played together and were joined by momma in short time.  Together we go to the back yard and enjoy the idyllic temperatures that this early November evening offered.  Mom and Emerson went to deliver a gift we had gotten for a neighbor in need, while I sat on the hill in the back of house alone.  It was quiet and still.  The sun had set but light had not yet been hidden.  I enjoyed the moment, I looked at the brick red leaves of our fledgling crape mrytle silhouetted against a custard colored sky.  And I experienced a wave of contentment and hope.  Blessed by a family I adore and can't imagine life without, surrounded by a growing number of friends that I love, who challenge me and garner my respect, buoyed by what might could happen in business, in politics, in life, I felt whole.  A feeling that I rarely get to experience.

    Tonight, I watched what I didn't think I would see in my lifetime.  I witnessed the promise of America and was overwhelmed.  Just as President-Elect Obama was beginning his speech, Emerson began to cry.  Mom went and got her and the three of us sat on the couch in silence and witnessed history. 

     Just 60 years ago, Obama would not have been able to dine in the same area as I or drink from the same water fountain.  It wasn't long ago that he would have even been able to vote, but there he stood.  Speaking not of division but of unity, not of war but of working together for peace.  There he spoke, elected by a majority of American's and in one night, I felt that this country was able to restore much of its reputation that we have so undermined these last eight years.  I am not naive enough to think that our great challenges have been solved or that difficult days won't lie ahead, but tonight I was filled with hope that my daughter will have the opportunity to grow up in a world where people are truly judged by their character not their skin.  And that alone is worth it for me.

    The sun set this afternoon in the most pleasant of ways and tomorrow I will wake up to a new one. New in more ways that I think I could ever imagine.

Powell Endorsement Coming?

Politico is reporting that Colin Powell may be making a public endorsement for Barack Obama this Sunday on Meet the Press. It is said that Powell wanted to wait until he saw all three debates before making a decision.  Apparently, Powell saw what most all of us saw.  An incredibly gifted intellect with a calm, presidential demenaor.  This has to hurt McCain the most, but Powell like most of us are tired of the bemeaning, sacrastic, antagonistic politics that have marked the Republican reign and have proven to utlimately undermined the McCain/Palin ticket. 

Thank you again, General Poweell, for serving your country proudly.

Perhaps the best film you will see all year

The following is based on true events:


Bobby Lowder's Office!

A Simplified Guide to a Financial Apocalypse

In an effort to distract me from my card play, someone at our home poker game asked me what I thought about the "bailout" that passed last week.  After the 2nd sentence of explanation, it was obvious that they either didn't really care or just enjoyed taking my chips while I tried to explain how we got here and why I felt something, "bailout" or something else had to be done.  It was also obvious to me that I don't have an easy answer that connects.  So for those interested in why it seems all hell has broken loose economically, I will try to give the old college try.

Everything starts  during the real estate bubble.  Remember that?  Real estate was suppose to be where the money was to be made.  You turn on a cable channel and watch, "Flip my house" or "What's my house worth?"  That these shows were even green lighted, much less popular should have been symptom number one that something was going awry.  When you watch a "realtor" show a house for entertainment, there is a problem..

The fact is everyone wanted part of the action.  After all, you would hear of people making eye popping profits and with interest rates low, real estate going up (after all they don't make any more of it, you know), people of all financial levels were catching the American dream. 

With so many people buying houses they really couldn't afford and the mortgage business being an extremely profitable venture, there was fierce competition to originate loans despite the ability of the borrower to be able to repay.  That coupled with the fact that most mortgages could be sold off, there was little reason to be concerned about the risk because the agent could get his fat commission, sell the loan off for someone else to worry about.  These loans were then bundled together with other loans in instruments called CMO (Collaterialized Mortgage Obligations) or CDO (Collaterized Debt Obligations).  The higher the average risk of the loan in those instrument the higher the yield.  Which leads us to what should have been a second harbinger of things to come.  When you are getting 10-12% returns on securites that are considered "fixed income" you should know something isn't right. You don't buy fixed income securities for "return" but rather for security and income, not growth.

Okay, back to the borrower.  Here is what a conversation may have sounded like in a typical mortgage office.

AGENT-  "How can I help you?"

BORROWER- "Um,  I want to move into a house with a better school for my kids (notice we always justify our greed with our kids."

AGENT- "Great! How's your credit?"

BORROWER- "Well, that's the thing, it isn't that great, but I think this home will be a great investment and, you know, my kids can go to this great school.  I may even sell this home to fund my retirement.  Can you help people with crappy credit?"

AGENT-  "Oh sure, that's why we are here, to help people...."

BORROWER-  "Well, I make....

AGENT-  "No, no, no, don't worry about that, we can get a loan that you can afford.  How much a month could you pay?"

BORROWER- "Uhhh, I don't know, maybe $800 per month, but my credit.....

AGENT- "Hey, like I said, don't worry about. I am here for you.  Here's what you do.  We will put you in an Adjustable Rate Mortgage, you will only pay like 4% interest for 2 years.  That will keep you monthly payment at $800.  By paying it, you will improve your credit, and with this great investment going up, you will be able to use the equity to refinance into a fixed rate loan and get a good interest rate because your credit will be all fixed."

BORROWER- "Wow! That's sounds great, but you said something about 2 years, what happen when...."

AGENT- "You come back to me and we will refinance! It's a win-win for everyone."

BORROWER-  "Oh, thank you, thank you.  This is a dream come true."

The agent gets a huge commission, the borrower get's his kid into THE school system, and some investment bank gets another mortgage to bundle up to sell to pensions, institutions, and individual investors.  All is good.

The poor insurance industry however was missing out on this orgy of money, so they decided to get in on the action.  They recognized that many of these bundled securities are being sold to people who like safety.  So they decided to sell an insurance equivalent on those securities.  The idea being that they would insure these investments should they blow up.  They called these "credit default swaps."  Notice the name.  They will swap the risk should the credit represented in those loans default.  These proved to be extremely popular (and profitable).  It has been estimated that there were about 62 trillion in credit default swaps issued.  That is trillion!   

You will also notice that I said estimated, because no one really knows.  Why? Because, notice that credit default swaps are not called what they are, insurance.  Insurance in not in the name.  Why?  Because insurance is regulated by the states and we know that regulation is ultimate evil. If you deregulate, the free markets can rule and we do love the free market (as if it really existed).

So what you have is billions if not trillions of dollars in risky loans made with the belief that real estate would increase forever, insurance on those loan, predicated on the fact they would never have to pay a claim. 

Then the bubble burst.  Real Estate values fell, that home equity the borrower was planning on using to refinance was nowhere to be found.  His mortgage payments went up after two years and all of a sudden his home was facing foreclosure.  Again and again this happened.  Which means all those CMOs and CDOs were blowing up, which meant that all those credit default swaps were being called to pay out.  Since the insurance companies weren't regulated, there weren't required to keep any capital liquid to payout on the claims. Instead those used those huge profits to pay extraordinary bonuses and commissions to executives.

Hence, what we know as a credit crunch.  That simply means that institutions no longer trusted other institutions to lend them money because they didn't know if they would be able to pay back those loans.  Why no trust?  Because no one could determine how much bad investments, or bad swaps a company held.  All of sudden risk mattered again and the pipeline of credit ceased. No credit, meant that businesses couldn't continue their business, which meant, a collapse.  

Hence the so called "bailout."  Which essentially is the government, using taxpayer money, to buy these endangered investments, to get them off their book, so that banks and institutions will feel better about lending them money again.  The idea is that this will free up the offering of credit and business can continue. 

If it doesn't work, or if nothing was done, the mom and pop store on main street wouldn't be able to keep their inventory up to date, couldn't make their payroll, couldn't pay their bills.  That would lead to layoffs, and layoffs would lead to rapid decrease in consumer spending which makes up 2/3rds of the the American economy.  That my friends would  be a depression, not a recession.  It is a perfect financial storm.  And that is as simply as I know how to put it. 

My New Approach to Life: Lower Expectations

Exactly what I thought would happen took place tonight in the V.P. debate and it has opened a whole new way of viewing the world.  I have always been personally haunted by high expectations.  It has often caused me to lack confidence, and be socially awkward and too often defensive. But Sarah Palin has shown me, now on two occasions that you can if you keep expectations low, it is very easy to feel successful.  So I am seriously considering lowering my expectations on everything so that I will always feel happy, surprised and accomplished. 

I congratulate Governor Palin for taking the extraordinarily (and deserving) low expectations both at the Republican Convention and tonight in the debate for proving how easy it is to succeed.  Avoid questions, stick to your talking points, say "darn it," "heck," "drill" or "say it ain't so."  If you have to answer a question say, "yes," "no," or "I do" or "I do not" and then revert back to the script. It is obvious that if you are pretty, that too, can give your credibility without any substance.  Governor Palin, you have inspired me.  No longer will I succumb to the possibility of failure.  I will triumph under this new enlightenment.

So from now on I am going to take a new path and never expect anything other than mediocrity. 

• Instead of acknowledging I need to lose 60 pounds, my new goal is 1/2 lb.  I will be slim, trim, happy, and healthy.
• I no longer expect to be successful in my business, just aspire to stay solvent.
• I will no longer hope that Christians actually follow Christ because just going to church is much easier.
• I will expect my daughter to be a C student, score 17 on the ACT test and go to a community college.
• I will only demand of local officials that they stay out of jail (that may be too high).
• I will cheer that Alabama go 6-7 or 7-6 each year.
• I will try from now on to be the second person to hit the rail at poker instead of first, making it to the final two of my home game takes too long and is way too stressful.
• I will hope to live to age 50, and financially prepare to live to 55 in case I over achieve.
• I will ask my wife to not cheat on me more that 2 times.
• I will read one book before I die.
• I will expect my president to lie to me, invade foreign countries, pass policies that benefit his/her friends, allow our infrastructure to crumble, illegally wire tap, disrespect the dignity of foreigners, fire attorneys that don't tow the line, piss off our allies, antagonize our enemies, fail us during natural disasters, scare the hell of me with "Red" security levels, run our economy into the ground, deregulate everything so that corporate greed can walk over all those who are not fortunate enough to be in the one percentile of American's, torture our enemies, question the character of anyone that disagrees with him/her, and have potential successors be willing to shoot their best friends in the face. 

I am already feeling better now that the country and myself are making progress.

Readem' All

I have to teach a class tonight but will be rushing home to catch some of the vice presidential debate.  I must say that I may have been too harsh on Governor Palin.  Having a love for reading but rarely matching my passion with time, I am now in awe of the Governor.  Not only does she like to read, SHE READs "all of umm."  Crap, woman, at least name the Juneau Empire or the Anchorage Daily News.

Exhibit Number 1

I mentioned in a previous post that John McCain has at times tried to say that this election is about who has better judgment.  He likes to tout his decision to support "The Surge" as an example of judgment and how Obama lacks it.  Of course, it was Obama's judgment that we not be in the war with Iraq to begin with, but apparently that vindicated judgment does not count.

Since this is the week of the vice presidential debates, let's talk about judgment.  When putting together a sucessesstion plan, Obama picked an experienced foreign policy expert who is accepted as an outstanding choice by both sides of the aisle.  You may disagree with Biden's politics but no one can say he would not be able to step in and guide this country.  Traditionally the Vice President (Cheney excluded) has not been a particularly powerful role, but there is no doubt that she/he is one stopped heartbeat away from office, so it may not have powers but it certainly has gravitas.  When picking a possible heir, you need to demonstrate judgment.  Here is McCains judgment in action.


UNBELIEVABLE! You do not have to be a wall street insider to at the very least understand the surface issues of the bailout. That has nothing to do with. Judgment, Senator McCain, judgment. Again! I can't believe I am seeing this. This is a possible leader of the free world. Seriously, this is not laughable, this is scary. I asked a Republican friend of mine if he really, seriously thought Palin was prepare to be a possible president. And I thought this guy was reasonable and intelligent and he said "yes." I almost dropped the phone. So for my friend who apparently doesn't get the extended cable package that would include any other news channel beside Fox, I will offer you more examples. How much hypocrisy can you stand? But there is more... Just rambling non-sense. JUDGMENT! And in case you missed this one. It is a classic. I love how Charlie was about to move on when it "dawned" on him that this lady doesn't have a friggin' clue and he rephrased the question. And on the continual lying that she refused to give up despite all the facts. All this from a woman who hasn't even been given free access to press. This is scary stuff. So if judgment is what this campaign is about, then this shouldn't even be close.

Unsullied Debate Impressions

Just got finished watching the 1st presidential debate and wanted to get some thoughts down before I get swayed by punditry, to which we are all susceptible.

For any reader of this blog it will come as no surprise that I am enthusiastically supporting Obama this year.  I have supported other Democratic presidential candidates (I have voted Republican as well) in the past but it was purely ideological support.  I liked Gore, but he was so mechanical and like everyone, the constant drama of the Clinton years had me fatigued and I worried that it would continue  Kerry was worse, though I had continued to become disillusioned about Republican and even more engaged in the election, I did not care for Kerry. So this election cycle has been very exciting for me because I really, really like Obama. 

That said, I will say this debate was a draw, from a pure debate point of view.  I guess since this was the debate that McCain was suppose to dominate because it dealt with foreign policy, the issue that Obama is perceived to be weak on, it could be a win for Obama. 

Now on the substance of the issues, I agree with Obama and not with McCain, but I felt Obama missed some opportunities and McCain was surprisingly disciplined.  He had his talking points, "He doesn't understand" and a his canned lines like, "It is hard to reach from that far from the left to reach across the aisle."  Those score well with people who are not politicos.

McCain clearly knows about foreign policy, it is just that I disagree with his approach.  I think hope that people saw that Obama is informed on the issues.  Obama can't win on the "experience" issue on this point, but what came through clearly and one of the reason I truly believe Obama can be a great president is his temperament.  He believes in dialog, in listening to opposing views while not sacrificing the ability to take tough stances. It showed as Obama was willing to look at his opponent and address him.  McCain however just stood there, gritted his teeth, faked a smile and tried to keep from blowing his top. He would not looked at Obama. That will go over well when dealing with foreign leaders. 

I am sick of the American propensity to rattle it's saber, beat its chest, and demand acquiescence to our worldview.  I am an idealist I suppose, but what happened to respectable disagreement and a reasonable exchange of ideas.  Why can't we accept that we are but one member of the global community?  Why can't we embrace the idea that there are other cultures and values that have validity?  I have no confidence that McCain will restore America as the envy of the world, but rather further isolate us. 

The debate itself was substantive, as much as public politics can get I guess and the tone was sober.  That sobriety however caused me even more concern about McCain's choice for a running mate.  No one doubts that Biden can be conversant on every issue of foreign policy should he have to, but can anyone seriously feel that Sarah Palin can be effective after seeing her continue to tout her foreign policy expertise because she can "see" Russia from Alaska?  McCain likes to tout judgment.  I will submit his choice for a running mate and ask is this the judgment we need?

Next up, the Vice Presidentail debate!  That one will be interesting for sure.  I can't wait. Now I will go and watch the shows, read the news and find out what I was suppose to think. 

A Tannehill Promenade Wish List

The Colonial Properties Tannehill Promenade, has by most accounts been a great success.  With a movie house among the best in the area and a Publix that is killing its competition and a Target that slowly (but surely) is getting it's act together, people are spending money in southwest Jefferson County. 

People that once would have driven two or three exits down I-459 are now stopping at Exit 1, cutting off the money trail that once regularly flowed to Hoover with its pretentious, "looking down their nose at all things not Hoover" attitude.  Read any comments on al.com that has to do with the Bessemer/McCalla area and you will that attitude and the embedded racism that continues to balkanize much of the Birmingham community.

So while I am thrilled a the good showing, I am growing impatient waiting on the rest of phase 1 to come online.  Chik-fil-a, Logan's, McAllister's, Taco Bell and Full Moon will be welcome additions.  I am also ready for a bank.  I am at Regions, but if they don't get off their tuffett and get their branch built I will be bolting to the new Credit Union or Wachovia, both of which are or will be located at the Promenade.  I am interested in the Toll House store as well. 

But even while we wait, there comes the announcement today in the Birmingham rag about Colonial wanting to start on Phase's 2 and 3.  What was interesting was that the stores listings were pretty specific.  JC Penny (weren't they suppose to be in phase 1?), Red Robin, Krystals and Lamar's Donuts (hmmm, doooonuutttts).  Phase 3 is stated to feature a home improvement retailer, which I assume is a Home Depot since Lowe's has a store in Bessemer already.  I like Lowe's better but Home Depot wanting to expand this direction and compete with Lowe's make sense.

Aside from the donuts, I am not terribly excited about any of these. I am not bummed, but not excited. 

If I had to choose, I would vote for a book store like Barnes and Noble or Borders.  Books A Million's layout stresses me and it looks junky, but I would even welcome it.  I would also advocate for a Best Buy, we need a good consumer electronic retailer here and I think it would do very well since that market is completely ignored on this side of the county with the exception of a Radio Shak here or there.  I would like a nice pub (not another "sports bar") and/or independent gourmet coffee shop.  I am happy with the Starbucks at Target, but I don't like walking into a big box for a small coffee.  I prefer intimacy in my coffee shops. We have another coffee shop in McCalla, but they can't decide if they want to sell coffee or ice cream or chicken salad (which is good) or socks.  And their coffee is average at best and often just very bad. 

I would love an Academy Sports but I don't see that with Hibbetts already established, but this is a wish list.  I would like to see some more sit down restaurants and no more clothing establishments.  I'd die for a Thai restaurant but that would border on delirium.

Beyond stoking my imagination, I wondered what was going to happen to the current footprint slated for JC Penny.  I had heard that JCP was suing Colonial over the sinkhole issue.  If they do indeed move to Phase 2, what happens with the current property?  Anyone heard?  I suppose that was too difficult a question for the reporter to ask. 

Anyway, do you have any wishes for the retail growth of the best secret in the Birmingham Metro area?

Honesty is the best policy

I do not advocate drunk driving, but you have to admire this man's honesty.