Partying is Such Sweet Sorrow...

This will be the final regularly-scheduled identical post for the Chris Jones Group and Mortgage Blogger, as it’s become rather obvious that more than half the time I don’t write much about finance.  Since Mortgage Blogger is really supposed to be about mortgages and real-estate finance, it seems a little odd that I’d post some of my more, shall we say, esoteric musings on that site.  So I’ll endeavor to keep both sites going simultaneously, but as you may have noticed, even handling a single post to both sites sometimes handcuffs me.

Speaking of handcuffs, here’s a photo of me being arrested last week.  No, no, it was a charity gig.

The bond market has been absolutely fantastic the last couple days, and even the end of last week, as economic numbers continue to walk that very fine line between good but not really good.  Bond rates are rising and that’s driving mortgage rates down.  Good news for us.  The 30-year mortgage is down at about 6% right now, and that’s going to be a strong signal for buying in the late winter/early spring if things last that long.  I suspect that you’ll start to see articles about how the worst may be over for real-estate price declines; some articles are already coming out about that.  And that would make this the shortest housing recession ever recorded.  About two weeks long, I believe.

Plug here for our Homebuyer’s Workshop on November 9 at 7pm.  If you enjoy this blog, you have no possible reason to miss the workshop, which will be, I promise you, even better.  Well, okay.  If you live in Virginia, you’re excused.  RSVP here.

Jeanette and I wwere shopping for costumes the other day and something occurred to me.  I have five standard costumes that I wear – a minuteman, a musketeer, a gangster (mostly for the suit), a pirate and Zorro.  I’ve made much of the costumery myself, and only buy things when I cannot make them out of anything handy (I’ve made rapiers, for instance, as two of the above costumes require them, but the musket alas was beyond my expertise).  Jeanette, by contrast, has no costume at all.  By our count, she’s been showing-pregnant four times while we’ve been married, so that makes it a little harder, but really, she ought to have something standard that she can wear when she needs to.  So we went to the costume shop to get her something.

Apparently, if you are a woman, you have three options: prostitute, clueless and disgusting old woman, or witch.  Witch is easy, though I haven’t seen any White Witch costumes (shame, really, that was a gool getup), and traditional.  Disgusting older person has been around a while, and isn’t that far from zombie, another traditional costume.  But by far the most common costume is prostitute, in an incredible and almost infinite array of varieties: Wonder Woman, Cleopatra, gangster moll, Batgirl, Catwoman, French maid, candystriper, nurse, cheerleader, what have you.  All of these costumes feature bodices cut so low they needn’t bother, and skirts cut so high that the crotch is visible.  Seriously.  In our little community, many of the pictures had the prices pasted over the crotch of the model.  From the one or two that were not so tastefully covered, I could tell why the others had been treated so.

Steve Stockdale, friend of the Group, reports that mothers go with their daughters and pick out these costumes.  That a daughter could wear one of these costumes with her mother’s permission boggles the mind.  Certainly my daughters will not, and my wife naturally wasn’t that enamored of doing so either.  What’s a girl to do?  I have infinite options, it seems like.  What does Jeanette have?

One of our neighbors is going as Mother Nature, a very good idea without a great deal of photographic example, so she’ll be explaining it all night, which to my mind defeats the purpose, or at least modifies it to the point that it’s annoying rather than fun.  There are some costumes that make sense in the presence of the male half, for instance she could be Juliet to my Romeo, or even Queen Mother Anne to my D’Artagnan, if you like The Man in the Iron Mask (and I do), but neither of those, nor many others like them, make much sense on their own.

Suggestions?

A Hymn to Shirley

A client of ours, a member of The Chris Jones Group, died last week. Her name was Shirley Auxier. We helped her buy a house for herself and half a dozen of her children and children's friends a couple of years ago. It's hard to imagine a woman more completely dedicated to the wellbeing of her children than Shirley, and it was a joy to work with her.

I went to the funeral Monday, after seeing her obituary in the paper the day before. It was a grey day, and rainy, and perhaps that had something to do with the small number of people that came, but there might be more to it than that. Probably, outside of immediate family, there were 35 people in the hall. Thirty-five people to say goodbye to a woman that, as her son put it, "is so good that if she is not in Heaven, the rest of us are never going to get there."

What can I say about such things? I have relatively little acquaintance with death. All my brothers and sisters are still living, and both my parents, all of my children and all but three of my first cousins, of which there are a plenitude. I have no idea what kind of funeral attendance any of us would have, yet it still seemed a shame to me that more people weren't there. This was a good woman and her life will be celebrated for generations. She was, I have no doubt, welcomed with open arms On High. But what she did was not flashy and not well-known. Maybe that's it.

We mailed out the Potty Post today (God bless the Empress!), and my lead article is about this very thing, coincidentally, about doing the best job you can in the place you are. Blooming where you are planted, that sort of thing. Except that there's more to it than that. Most blooming is done in meadows nobody but God ever sees. Most heroes are people nobody ever knows about. The world is made to run mostly by people like my wife that labor behind the scenes and make possible all the chairmanships and presidencies and all the other stuff I get to do. Without her, I would have nothing and be nothing worth mentioning - not simply because I would now be a warped, frustrated old man watching life go by, and she has made something better out of me - but because she is the framework that my life rests on. Muscles move because there's a skeleton for them to pull on, but nobody notices the skeleton until it breaks.

It's very, very hard to be satisfied with that. Once in a while, Jeanette isn't. I can't help wondering if Shirley was.

She should have been. If God looketh on the heart, and I believe He does, then he will have seen there a flower more beautiful than any but her children - and possibly not even they - have ever seen. I do not think that Shirley could see it, either, and probably she'd have been very embarrassed that I'm saying this, but when I say that most good work is done where no one sees, I mean no one, not even the person doing the deed itself. The noblest of actions are taken by those who aren't paying attention to their nobility at all, and who, if you asked them how they could do such a grand thing, would be surprised at the question and have no idea what you're talking about. Shirley shared her house and her money and her entire life, everything she did, with a few dozen people that needed her to be something phenomenal. For them, she was. And if you ask her, when you see her next, how she could devote herself so entirely to the health and wellness of everyone but herself, she will be mystified at how you could ask such a thing. How could she not? She went, from all appearances, wholly unconvinced that she'd done enough, sure that all she did was the best she could, and what anyone else would have done in her place.

No, Shirley, they wouldn't have. But you did. And a little more of the color of the world went with you when you left.

We'll miss you.

Life, the Universe, and Everything

Promised to talk a little about the market, so let's do that. The Fed is making gumbly noises about doing something foolish like continuing to raise rates, but I suspect it's mostly sound and fury, signifying nothing but a desire to be seen as continually relevant. It's tough during political elections for the poor undervalued members of the World's Most Powerful Financial Institution. So it's possible that the next Fed meeting produces another rate hike. Not likely, but possible.

Meanwhile, here's a howdy-do: new housing starts were up strongly for the first time this year, while new building permits were down sharply. Figure that one out. I had originally hoped that this meant more people were just building houses and not getting the sign-off from the man first, but then decided that's just my libertarian fantasy talking. Nevertheless, the bond markets don't seem to know what to do with that information, so bonds have been flat all week. Fine by me. For those just joining us, and I sure hope there are some out there that are (WELCOME!), what we track here is mostly the 10-year bond, which is the best indicator of the direction of mortgage interest rates. When that bond rises, that is, when its price falls and its yield rises, that means mortgage rates will improve. Probably. Eventually. There's a whole treatise on this here, if you're interested.

The stock market continues to flirt with new highs all the time, cresting 12,000 recently, and perhaps I should take a minute and talk about that, too. Ordinarily, stock-market good news is bond-market bad news. This makes some sense, of course, because there's only so much money out there, and if it's not buying bonds, then it' buying stocks, and vice-versa. Except for several things, like, in no particular order: there's never been this much money out there to buy anything, so it's possible that everything can rise simultaneously; currently we're in a trend where long-term bonds are so popular that the yield curve has inverted (bonds with short maturities actually have higher yields than bonds with longer ones), and nobody knows what that means for sure; the Fed is the prime market mover right now, so anything tyhat makes another stupid move by the Fed more likely hurts both stocks and bonds equally; the election season is shaping up to be a potential disaster for the only political party that has any clue how the economy works; etc. Needless to say, there's a lot of chaff out there among the wheat and markets are not sure how to price any of it in. Given this, traders look at individual stocks, preferably really big ones (the Dow Industrials, for instance, note please that the Nasdaq isn't anywhere near its all-time high, nor likely to get near anytime soon), and buy those, figuring GM is likely to be a safe bet, if anything is. Right. GM. Hmmmmm..... (for the rest of the Dow components, go here).

Anyway, if you want to know what's going to happen in the future, you're in the right place. I love making predictions. Here are a few:

• 30-year mortgage rates will hit 6.5% in April next year, up about .25% from here.
• The Dow will crest just after the November elections, and go into the new year at about 11500.
• The Democrats will pick up ten seats in the House but only two in the Senate, and election night will be an almost across-the-board disaster for them again this year.
• US fiscal and foreign and domestic policy will improve, but only slightly, as a result.
• There will be no reform to the budget, or to either of the twin demons of federal bankruptcy, Social Security and Medicare.
• The economy will limp into January and next year will cool off entirely. Nobody will realize it has done this until the middle of the second quarter 2007.
• The Super Bowl will be won by neither the Colts nor the Bears.
• You, however, will be sitting pretty.

You read it here first.

A Noble Peace Prize

In what has to be the shock of the decade in international awards, the Nobel Peace Prize went to a man who actually has been helping to create lasting peace. Mohammed Yunus, one of my heroes since I learned the first thing about economics, won the prize this weekend. He is the founder of the Grameen Bank, and legitimately the father of microcredit, a program so successful in every single country where it is tried that one wonders what keeps the multi-trillion-dollar welfare programs from collapsing under the wight of their own uselessness. Well, okay. Nobody wonders. But still.

Microcredit is the idea that you don't even have to teach people how to fish. If you give them a pole, they'll figure out the rest when they're hungry enough. Yunus's book, Banker to the Poor, is half autobiography and half economics treatise on why lending small amounts of money to people transforms the world. He's right. Get the book.

This caps quite a few days for me, as I spent almost all day Friday at a charity event for A Child's Hope, an organization that is rescuing orphaned children in several ridiculously poor countries around the world, most notably in Haiti. As of this meeting, the Chris Jones Group has officially changed charities, and we'll be donating all our money from all our events to this foundation from here on out. Seriously folks, come to Twelfth Night and prepare to be blown away.

In mortgage news, blah, blah, blah. There are other things going on in the world. We'll do something about the market tomorrow.

Odds and Ends

I was warned at one point that blogging would take over my life. I have been blogging now for more than two years - longer, according to some studies, than 95% of the blogs on the 'net - and although it has not taken over my life it is true that it has occasionally been an oppressive nagging at the back of my mind, especially when it's been a week or so since my last post.

Some stuff:

First off, rates are back on the rise. We've added .25% to the 30-year rate over the last three trading days, back to 6.25% or even 6.375%. Most of this move, practically all of it, is caused by angst over what the Fed is going to do, rather than the actual economic numbers themselves. The Fed Minutes - a record of what went on at the last Fed meeting - were released yesterday and they said, in part, that the Fed still believed that inflation was a problem, and that more rate hikes might be necessary. But that wasn't the scary part; that was expected after the insanity of the last two years of Fed commentary. What made me shake my head was the comment from one of the Fed members that the Fed needed to "remain vigilant" on inflation to "establish the Fed's inflation-fighting credentials". Never mind simply producing sound financial policy. Let's make sure nobody thinks we're soft. Sigh.

Secondly, the housing market continues to cool in places where it just couldn't get any hotter, like San Francisco, Las Vegas, and St. George. However, the market in central Utah and other places of particular importance to readers of this blog continues to be hot, if not quite as hot as it has been. The house around the corner has been for sale for two months now, and still hasn't sold. Of course, it's the only house for sale for three blocks in any direction, so I don't interpret this as a sign of a crash. Still, it appears that those of us in Lehi cannot expect to get 5-7% increases in the price of our homes every month for a while. But we'll revisit this topic in the spring. Housing always slows down in the winter.

Thirdly, another reminder of our Homebuyers' Workshop on November 9, at 6pm. You'll need to RSVP if you want to be there. Call Olivia at 787-2162. We're slowly running out of spots, so don't wait.

Other stuff:

The top ten quotes about the French.

Lots of my friends have expressed their satisfaction that the US Congress has passed a bill to have the US build a border fence with Mexico. I think they might want to re-think this, in light of the 14 years that it has taken to build just a 14-mile fence between San Diego and Tijuana. We're free-marketeers here, and that includes free markets in people. I will have nothing further to say about this subject on this blog. Ever.

The most creative take on naming rights (you know, stuff like Minute Maid Park) I've seen in a while.

Some say blogging is a waste of time. Hah. That's ridiculous. This post all by itself made the entire invention of the Internet worth it. How a 10th anniversary, a plane flight, and a poker game conspire to make a guy $10,000. Read the whole thing. Freakonomics was a great book, I've said that before, but the http://www.freakonomics.com/blog/ is just as good. It's like getting a new chapter every couple of days.

More later, but the kids are out of school for the rest of the week, so don't get antsy if it doesn't come soon.

And thank you, sincerely, for reading. It means a lot to me.

The Little Bluebird of Happiness

Yesterday I posited that Americans are better off now than they were 30 years ago, and I maintain this is true for all income categories, races, genders and sexual orientations. But then I asked if we are happier. That's a much tougher question to answer.

And I think my answer would have to be no.

I reason on this wise: I am happy when I choose to be. I am sad when I choose to be. It is true that certain food produces chemicals in my body that push me toward sensations that are like happiness; it is likewise true that other people have chemical imbalances that make it practically impossible to overcome depression. I am not talking about these people. Generally speaking, for most of us, our happiness is internally derived and decided on (or against). I've met really, really happy people that were dirt poor, and rich people that were miserable, and vice-versa. Bet you have, too.

Since I am conservative, and one of the tenets of conservatism is that people are basically the same wherever and whenever you go, I therefore conclude that people are deciding to be happy in roughly the same proportions they used to. Therefore we are not happier in the aggregate.

There is another component to this, as I believe in God, and I believe that doing what God instructs is a good way to be happy permanently. Not doing what God instructs is a good way to be miserable, internal decisions or no. I know people that have a foundation of uncrackable happiness, who do not ever seem to be rocked, who show no sign of stress, who meet the world with a cheerful heart no matter what happens to them. These people universally have a deep faith in God. Watch La Vita e Bella, if you can stand to, and that's what Roxanne Clark was like. She died a few years ago after being in more or less constant pain for years. She was cheerful to the last. She had no regard for herself, but extended herself to help and lift others every minute I knew her. I do not believe that this kind of happiness is an internal decision so much as a life decision, a commitment to do what God instructs and a trust in Him that He knows what's best, whether we can see it or not.

And returning to the question I began with, I don't believe that the number of these giants is increasing much, either, so again, I have to say that we're about as happy as we've ever been, in general. For all my marvelous gadgets, indistinguishable from magic, I've never been happier than I was thirty years ago on Christmas morning in my front yard with my football and my brand-new Rams helmet from the Sears catalogue. I've been just that happy, and my happiness has become deeper and richer, but that, ladies and gentlemen, was a fullness of joy. You can't get happier than that.

Have you such a moment you'd be willing to share?

Core CPI, etc.

Want to announce again our First-time Homebuyers' Seminar (not just for first-time homebuyers) coming up November 9. Best 2 hours of financial/real-estate advice you'll get, or your money back. Oh, right. It's free. But you have to RSVP, and last I checked, spots were not exactly going begging. I think we still have some seats...

A couple of weeks ago, a study was released that essentially said that over the last 30 years, the average American worker's pay improved by only 4% after adjusting for inflation. Now, first off, I don't know why that's an indictment of the capitalist system, such as it is in America, unless you want to go back and say that most folks were in the poorhouse 30 years ago. They weren't. But secondly, and far more importantly, this number is completely laughable, so divorced from reality as to be irrelevant to anything.

Let's just cut right to the chase, shall we? Here's the question: if I could, would I take a 5% pay cut to go back to 1976? How about a 10% raise? 20%?

And of course the answer is under no conceivable circumstances. Let's say that in inflation-adjusted dollars, the average American had $200 a month of disposable income in 1976. What could he buy with it? Um...books. Records (vinyl ones). Stereo equipment. Sporting goods (although not very high-quality goods). He can forget about leasing a car, since that wasn't invented yet. He can't fly, even domestically, anywhere. Too expensive. No CDs, since they don't exist. Can't open a brokerage account; that takes more money than that. No VCRs (for those that remember those) - in 1976, a VCR was over $1000. By the early 1980's, he could go to Erol's and rent a VCR along with his tape, if he wanted. $25 a crack (of course, he can buy a perfectly good VCR now at any pawnshop for $10 - or $2.76 in 1976 dollars). DVD? No, don't make me laugh. Music selection is also dramatically reduced by local-store availability. Nobody could download every song ever sung by any artist for 99 cents, because iTunes wasn't around. No Walkman, no computers, no Internet.

According to my wife and I, who were very interested in this project, something like 90% of the things we do every day were impossible, right down to getting a glass of water out of the fridge door. To say that I am 5% better off now than my father was in 1976 is certifiable. Even the lowliest backwater in the US has more wealth in terms of magical gadgets and freedom to acquire more of them than the richest man on earth did even fifteen years ago. We eat better. We live longer. We have more leisure time - FAR more leisure time, which itself is easier to consume in tiny bits here and there (YouTube at work? Anyone? That strike you as possible in the world of Dirty Harry?).

So when we start talking about economics here, and we do that from time to time, and we start waxing rhapsodic about how good things are, just remember - we're right.

Tomorrow, though, we'll consider the flip side of this coin - so we have all this stuff. Are we happier?