Blessed by the Potato

Let’s start with the nazis: grammar and food.

For the grammar issue of the week, I bring you singular they: do you think it’s wrong to say something like “A consumer of 2012 expects their laptops to be lighter and more powerful than ever?” Or do you think the “they” referring to a single consumer is the wrong pronoun, and “him/her” should be used instead?

I’ve long been fine with the singular they: tradition was to use “him” in such cases, even where the gender was indeterminate. When that became politically incorrect, “they” seemed to be an appropriate alternative: it has some parallels in the disuse of thee/thou in favour of the singular ye/you (which then just became “you”). Many writers started to use it, and I hear it all the time in casual speech. It’s certainly a damned sight cleaner than putting in the awkward “his/her” or “his or her” compound everywhere.

One alternative I don’t care for is the idea that it’s somehow more correct to use “her” in place of “him” for a gender-uncertain third person pronoun. “A student has many books to buy at university, straining her budget.” The use of “him” in that kind of sentence has been traditional and common for so long that seeing “her” in its place makes me think that the writer must somehow know the gender — it’s not serving as an effective gender-unknown pronoun. I personally find that much more distracting than the singular they.

Like all things in life, there does need to be balance: we can’t have everyone making up their own dialect and rules, but “thou/thee” has long since slipped from common usage to anachronistic, and we’ve had to recognize that evolution. Similarly for now, writing “u” in place of you, or using numerals for homophones “to” and “for” is a disgusting mark of poor upbringing and laziness — a hopefully temporary artifact of T9 phones that will forever be forgotten with the rise of QWERTY smartphones. But I do have to accept that one day in the distant future — long after I’m dead — such usage may be commonplace. (And for all my acceptance of linguistic evolution, I will still spin in my grave if it happens.) The role of the grammar nazi is to try to keep that sort of thing from getting a foothold in the first place, not to deny the common usage long after it’s happened.

On to food/grammar nazi-hybrids: if you make a dish in a non-traditional way, does it cease to be that dish? I don’t think so: language evolves, as do tastes, yet again today I heard the old saying that “chili isn’t chili if it has beans.” Well, traditional Texican chili maybe, but I think it’s more common with than without these days, and it’s not like a totally different food either way. Or like a few years ago, when a friend of Italian descent tried to tell me that there’s no such thing as “vegetarian lasagna”, because lasagna by definition has meat in it. Well, fine, think that all you want, but my vegetarian lasagna (or as I call it, “lasagna”) is pretty damned tasty, and there isn’t any confusion over what it is I’m slopping on my guests’ dinner plates (or they’re able to surmount the seeming oxymoron). [Plus as an aside, my understanding is that the word refers to the noodle, not the dish.]

I made cinnamon rolls today — kick-ass ones, I might add — and someone asked if I put raisins in them. No, as a matter of fact, I did not, nor would I ever. Raisins are gross, and I think putting raisins in your cinnamon rolls represents a serious lapse in judgement… but they do not cease to be cinnamon rolls by the addition of the raisins and their dark influence.

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Blueberry has been getting big so quickly. I’m finding that she’s already getting heavy and tough to carry around: though to be fair I had a lot of years of training with an 8-lbs cat, so when she was ~8 lbs I was well inside my comfort zone; now she’s pushing me into the feats of strength zone.

It’s amazing how fickle she is: perfectly content to screaming banshee in a second flat. And just as often, back again. I know that movement helps to settle her, so I hold her and walk, or do a little baby rain dance. I got tired today after just a few minutes of the baby rain dance, and it made me wonder if I had missed striking the right balance in terms of when to have kids: too young, and well, you’re too young: not ready, not able to handle them. Too old, and you can’t keep up.

Then she started crying again, and I lost that train of thought. I plodded on, doing laps of the house.

Singing turned to pleading. Pleading to soft moaning. “Pleeaaasseee. Hushushushushshhhhh.” Then I thought perhaps this is how the zombie apocalypse would feel: zombies shuffling across the face of the earth without end, moaning while being gummed by a smaller, unhappy zombie.

Rather than talk about myself this fortnightly update I figured I’d turn it over to my RL friends who are starting new blogs for the spring. First up is Ben, who’s launching a new business venture in southern Ontario in the form of an organic farm. Here’s Ben with the details:

Fresh Start Farm is a project Lisa and I have put together in order to test the waters when it comes to market gardening and earning a sustainable living farming. We are both huge foodies and we’ve been growing all kinds of things for our own consumption on a small scale over the years. At the same time we have both yearned for more space where we could expand our gardening into full-on farming. We both agree that the farming lifestyle is one that we would love to embrace.

After attending the Guelph Organic Conference last year, we both agreed that it was going to be our goal, over the next 5 years, to transition our current careers from what they are now, to full time farming.

We have rented a piece of land, roughly ¼ acre, in Pelham, a short drive from our house in Welland, while we continue the search for a suitable homestead to purchase.

We have invested a decent amount in seeds, soil amendments, tools and things, although the biggest investment will come in the form of our time throughout the growing season this year. In order to sell the produce we produce, we have rented a booth at the Welland Farmers’ Market, which is a fairly large and well attended market very close to our home and farm.

We have created the website in order to blog about our experience as well as get the word out as to what’s going on, what our problems and successes are, and most importantly, what we will have for sale at the market, once that time of year rolls around!

I’m sure most of your readers are in Toronto, so they would probably never attend the Welland Market, but in the future we may start offering a CSA delivery to the GTA. I still have a strong connection to North York, and I would love to get a booth at that market, if possible. In the interim, I encourage everyone to follow us as we go about doing what we do, offer comments and questions, and see that it is possible to be awesome if you want to be!

And also Lenny has launched a blog where he talks about whatever he feels like (so far, making his own pizza dough and encryption).

As for me, I’ve got my first job interview coming up later in the week. This is for a position I applied for in December, so I guess they’re not in a terrible rush to hire someone (and does give me hope for all the other applications I haven’t heard back on yet — there could yet be good news!). I’d say I’m pretty nervous to face the interview, but Wayfare’s way worse. To be fair, she knows how terrible I am at interviewing and the awful turns interviews can take, whereas I am consumed by the notion that I am generally awesome in all things, so it’ll be fine. ;)

Flag football is coming to an end, and much to my surprise attendance never got better. Who are these people that shell out over $100 to join a football league and only show up for one game? After much discussion and debate I decided not to join any leagues for the spring: as good as team sports are for motivating me to actually get out and exercise, there’s just too much uncertainty with a new job (any. day. now.) and baby on the way (same). Plus many of the spring leagues are on weeknights, and I have zero desire — nay, a full-on hatred of the very thought — of commuting around Toronto rush-hour at 6pm to try to make a game half-way across the city. Others may whine, but I’ll take a 10pm Sunday game every time.

I leave London alone for two months, and it all goes to hell…

Another article at the Globe warning about the housing market. I like the way Tom Bradley phrased this: “When I pull together the economic fundamentals, valuation and sentiment, real estate, as an investment, doesn’t look very attractive. The distribution of potential outcomes looks asymmetrical to me – limited upside and plenty of possible downside. But what really screams out at me is how many important factors are at extremes … bad extremes. One or two off-trend numbers can be explained away, but too many are jumping off the charts – price increases, mortgage rates, loan growth, consumer debt and home ownership levels.”

James Randi on scientists and trust and skepticism.

Nelson tries to find a way to short the Canadian real estate market.

Teacher Man, writing for CFB, says the Canadian real estate bubble can’t be denied any longer.

Well, it looks like the group deal fad may finally be getting to its final phase. About two years ago new group deal sites were popping up like crazy, offering steep discounts on everything from restaurants to meat to rock climbing.

I quickly soured on the concept after finding a few deals hard to redeem (one $10 offer ended up expiring before I could use it, and it ended up being a real last-minute rush to finally use my rock climbing pass the week before it expired). Some people got burned bad by the various butcher offers. Plus after the first few months there didn’t seem to be any decent deals, and far too many individual deal sites to track. I ended up signing up for Red Flag Deals’ roundup, which monitored most of the deals and just sent you one email… and really, there’s been nothing to get me excited. Many recent deals have you paying for coupons, which is confusing and stupid.

Then recently I noticed large discounts starting to come back, such as today’s wireless iphone keyboard for 60% off ($50 normally $120!!). Except… that’s not the regular price, or at least it shouldn’t be. Futureshop has it at $90, and Amazon (US) as cheap as $19. Plus the small print in the email says you have to pay for shipping as well, making that a paltry 30% off the futureshop price. There are plenty of other examples, so be sure to check if the huge percentage off advertised by the group deal is actually what you’ll be saving: it may not be worth the hassle if the so-called discount isn’t remotely realistic.

I still can’t believe how busy I am in unemployment. I figured if nothing else, having no steady income would be a chance to take some time to catch up on all the video games I didn’t play over the xmas break. Instead, I think I’ve been almost as busy as when I was working. The move didn’t help with that, so once I finish the last bit of unpacking (this week?) that might give me a bit of time back (and none too soon — Mass Effect 3 just came out!).

What I’ve found really shocking though is the complete silence on the job front. Not a single interview, even for the jobs I was perfect for. Ah, well, hopefully something will come up soon… On with the links!

An old speech of Charlie Munger’s is reposted, and it’s still good reading.

Rick Mercer epitomizes the condo insanity with the Condo Gun.

More and more housing bubble stories in the media, including the cover at Maclean’s. VREAA says this:

“Show of hands.. Anybody who hasn’t heard that Housing in Canada is in a ‘Bubble’?
Nobody?
Okay… so we’ve all heard.
Pumps are primed.
Now class… How are we going to respond to initial price drops?
Anybody?”

Larry MacDonald puts up another blog post attempting to counter the housing bear sentiment. I will admit: I simply do not understand his position. He doesn’t seem to refute the severe overvaluation — indeed, he confirms it — yet for some reason it doesn’t seem to bother him. Instead he talks about the lack of catalysts: “I agree with him that there is over-valuation—but I also believe there are other factors to consider. […]the catalyst for an end to the U.S. housing mania—a major tightening in monetary policy. I don’t see it in Canada yet;[…]” [emphasis mine]. To put it in terms of a bad analogy, it’d be like being at a party and finding a gas leak. “I smell gas. This is dangerous, I’m getting out of here” I’d say. “I smell it too,” Larry might say, “but nobody’s smoking in here. It’s fine. we can just open the windows and it’ll slowly air out.” “Well, either it blows up, or we’ll feel a chill with the windows open. Either way, this party is going to suck. Later!”

After saying he was leaving blogging and posting less frequently, TMW returns with this little post on valuing real estate. What I find hilarious is that just a week or two ago the BoC released a report saying that this was exactly the algorithm people used when valuing real estate, and that it was faulty because all it did was check to see if a particular property was over/under-priced relative to recent market moves, but implicitly assumed that both the starting price and the growth rate were rationally determined by an efficient market. If those two conditions weren’t true — and believe me, they’re not — then bubbles easily form because very few market participants are doing absolute pricing analysis. So this is a great method to use if you want to try to price a property for sale (to meet current market conditions), and a good one to use if you don’t care about overall valuation and just want to avoid being the one sucker who buys the most over-priced condo in the building… but you need an additional check as to the overall market sanity (i.e.: a rent vs buy analysis for your situation).

John Hempton at Bronte Capital explains why, despite Bronte’s small size, he isn’t chasing small caps. In short, he doesn’t think they’re as over-looked as many who chase small-caps think.

Boomer & Echo compare index funds to the big bank’s equity mutual funds. It goes about as well as you’d expect.

Michael James wonders if Berkshire Hathaway may be an index alternative and suitable for a passive investor. I figure why not: it’s diversified, the fees are low, and the long-term track record is good.

An article in the New York Times describes research that shows people with high IQs may get better investment returns. Though it doesn’t look like the returns come from digging up under-valued stocks, simply from following common sense investing principles that don’t require a high IQ to understand. “[Economists…] argued in a paper published in 2008 that many households avoid investing directly in stocks out of vague fears that they might be deliberately misled or cheated.” I know I’ve seen that kind of misplaced distrust many times when discussing investing. Somehow, over-valued under-diversified real estate is safe, and stocks are a rigged game.

Teller talks about magic and human perception. A fun little read! [HT: Barry Ritholtz]

A fairly exciting few weeks. My last lecture at UWO (at least until I get invited back), yet my first as a full-fledged PhD. It was not as polished as the version I gave last year, which is a shame since the students this year seemed a little more bright eyed and bushy tailed; that may have been helped by the fact that it was a decent day in an unbelievably mild winter, and not… ugh, I don’t even want to think of last winter.

Then I found out I won tickets to the Book Lover’s Ball, via a contest to write an attention-catching opening line to a novel. The ball is a fundraiser for the Toronto Public Library, so I entered hoping to win since it would be the perfect gift for Wayfare: a lover of both fancy parties and libraries!

The Ball was very much not what I had expected. I know of basically two definitions for ball: a fancy dance party, and a round thing you kick, bat at, or throw. The key part to the first definition being the dancing, and Wikipedia backs me up on that. There was no dancing. There were black ties and ballgowns and an excellent dinner, but no dancing. Which is just as well, because Wayfare is progressing from very pregnant to extremely pregnant, which would have made dancing awkward and painful. While I can see the poetic symmetry between Book and Ball, I think perhaps some more descriptive titles could have been chosen, such as: the Author’s Affair; Book Lover’s Banquet; the Knowledge Feast [which I particularly like since it could also apply to the library itself]; the Library Soiree; the Book Lover’s Benefit; or the Public Library Gala.

We met some famous authors, as well as a number we were assured were famous, though we had to take the organizers’ word for that (certainly more famous than me, anyway, which counts). We were asked to adopt a branch or implored to bid on the charity auctions several times, had some drinks, chatted, had dinner, and then the lights came on and we were asked to leave since people had to get up for work the next day. It was a fun night, and in support of a cause I can easily get behind.

We had a last chance to get dressed up in our finery and have a fancy night out to ourselves before having to worry about babysitters, which was fun. Please, take that as the take-home message before I get into the painful financial blogger OCD part below (in fact, feel free to skip the next two paragraphs, look for the bold text to start the link summary).

The tickets, won in a contest, were free. Given the face value (which granted is in large part a charitable donation), it was quite the contest win and a fantastic gift. Yet we spent hundreds of dollars on a tux and gown to go. Then hundreds more on a hotel room for the night. Then a surprisingly large amount on overnight parking downtown: I figured it would be expensive: $20 or maybe $30 for less than 24 hours near Front St.; I was shocked and angered to find it was $66 for 21 hours. Even though it was the least consequential cost of the evening, it really burned me up. Partly because I didn’t take a few minutes to research my parking options and to know in advance what to expect, and partly because I blindly followed the hotel’s instructions on where to park, and they should have warned me or had some kind of reasonably-priced option (a voucher or something if they don’t have their own lot). All told, the event ended up costing a majority of the vacation budget for the year, though I don’t think we had big vacation plans this year since we’ll have a newborn and I’ll have a new job which may not allow for a vacation this first summer anyway. The whole experience reminded me of the story of Diderot’s dressing gown (which is in recent memory thanks to reading The Wealthy Barber Returns — review to follow).

And speaking of Diderot’s dressing gown and creating new obligations, I now have a winning opening line to a novel, so there is some expectation that I follow that up with, if not a novel, at least a story of some kind. The thing is, I had no inkling of a story to go with that line: I was just reaching for something humourous and attention-catching that would fit within the strict character limit of the twitter contest. But if I’m unemployed anyway, no harm in trying to write a story, I guess (as long as I keep up the job applications)…

Links: The notion of housing risk goes mainstream.

A slew of articles recently on the risks associated with sky-high housing prices, like most everyone is waking up to the reality at once, including: the Globe’s connect-the-dots, Canadian Business’ prediction that the market will crash, and several others.

Macleans is surprisingly straightforward: “Yes, we’re in a bubble, and it will probably pop soon.” which was bolded in the text. I wasn’t happy to see “A whopping 75 per cent of mortgages in Canada are fully insured by Ottawa, according to the Financial Stability Board.” put forward as a reason not to worry.

The Financial Post reports that banks are dumping their exposure to even “prime” mortgages on the CMHC or securitization market. “Financial institutions are required to have mortgage-default insurance when a consumer has less than 20% equity. However, the banks have been seeking insurance on loans with even high downpayments — something not required by law — so they can securitize those bulk lending loans, thereby getting them off their balance sheets and reducing their capital requirements.” This is bringing the CMHC close to its limit for providing coverage, and it’s asking the banks to slow it down.

Just a few weeks ago, the news was dominated by the rush to the bottom in medium-term fixed-rate offerings by the banks. Now, those special offers are coming to an end.

A neat new hedge fund opportunity. Have a read, and no matter what you end up thinking of it, trust me and click on the “invest now” link to have a look at what comes next.

A very short post over at Divestor about selling Rogers Sugar after appreciating so much. I’ve had many such dilemmas this last year or so: with prices on things like Rogers Sugar, REITs, or other low/no-growth dividend payers hitting all time highs, am I being paid to take on equity risk? Sure, they’re towards the less risky, less volatile end of the equity spectrum, but I’m not sure if I’m comfortable locking in at 6%, especially when many preferreds are in the 5% range.

An article about behavioural economics.

Stats Canada is apparently going to refine the CPI calculation, which if it lead to a lowered CPI figure could lead to savings for the government (as many payments are inflation-adjusted). The article indicates that CPI is currently overstated, and I find that a bit odd, as I’ve long thought that CPI was understating inflation. Given the current government’s philosophy on stats, I wouldn’t be surprised if the revision was more about cost savings than data accuracy.

Canadian Capitalist talks about a “barbell” investment strategy. This is perhaps a good example of where combining two extremes doesn’t really give the same result as having a bunch of average stuff, or where increasing risk does not mean increasing returns.

Michael James says his MERQ measure is too extreme to be believable. But it’s really showing the impact of high fees. I still think it should be in dollars (and whenever I get off my butt will do short post on exactly that), but either way the important part of the message is that fees build up and cost an investor dearly.

Warren Buffett chimes in on investing in gold, bonds, or stocks, businesses, and other things. The summary widely picked up is that he isn’t keen on gold, but there’s also this gem: “Bonds promoted as offering risk-free returns are now priced to deliver return-free risk.” John Hempton adds some colour to that notion of investing in stocks rather than gold or bonds.

And after a few posts in a row cheerleading hybrids, news comes out that the Prius is going to get cheaper and better equipped for 2012. I’m kind of torn on that news: on the one hand it’s good for future hybrid owners, as it makes the financial decision even easier (though the Matrix also got stability control standard, so you don’t need to move up as many feature packages on the comparison car), which will be good for helping to get more on the road. On the other hand, reducing the MSRP of future vehicles means mine will now depreciate faster (not that I entertain plans to sell any time soon — I kept the last car until it was ~14 years old).

The teaser page for the Prius C (for compact) is also up, indicating it will get a fuel consumption rating of 3.7 L/100 km and a price tag under $21,000. Just a bit bigger than a $17k Yaris, that could be a tough choice for those that need a cheap, efficient commuter vehicle.