Excuse Me There… May I Lick Your Boot?

My nerves having again been calmed to the point where I could venture out of the air conditioned guestroom, I decided to accompany my associates to a restaurant that afforded what would be a rather dizzying perspective if viewed in time-lapse form. Our cheery congregation proceeded to be moved out of their initial seating location, as it was supposedly closed. Someone cracked that, given the rotation, couldn’t we just wait for a few minutes to be in the open section? And how many times would we end up moving?

Well, the answer was once, as I put my boot down firmly upon the issue. (ha!)

Do not mistake my intentions, as I am not normally one for the fruit-based drinks, but the prospect of owning such an entertaining keepsake drinking accessory proved to be my Achilles Heel here. (ha!)

What can I say? I wanted the night to get off on a good foot. (ha!)

Okay, I will cease my pathetic attempt at humor. I hopped over and found some squares with whom I could hang out:

Returning to the booth, someone mistook me for an octopus. A blowhard such as myself is rarely at a loss for words, but this was one of those rare moments. I truly took it as a compliment. A while and a few drinks later we decided to shoot a dramatic sunset shot. Ladies and gentlemen, Barack Obama!

Okay, so maybe neither of those things were true.

All things considered, it was a cozy little place that afforded us views of the surrounding suburbs. Given that it was our nation’s birthday, I had the foresight to look up the list of local pyrotechnic displays.

There were 39.

Three of us, my handler included, decided to wait it out, while the remainder of the party left to do ‘industrial-strength’ drinking.

We proceeded to get mellow-mellow with some bourbon and, as the night fell, the fireworks began. Everywhere. Unfortunately, the majority of the displays were so distant that it was nearly impossible to get a shot with both them and my hyperluminant self in frame and properly exposed. I think this made the resulting shot only more beautiful:

With nothing left to see, we returned to the hotel room briefly, prior to an hour-long disappearance of my handler and his lone associate for the purposes of karaoke. I sincerely regret having not been brought; should have lobbied a bit harder. That is not to say, however, that I did not get to flex my musical muscles. Upon their return, I was brought to the hotel lobby and we approached the event’s dance party. It was there that, figuratively, my jaw dropped. I was insistent that I let my voice be heard:

Fancy a piano duet?

Seeing the interminable line to the dance party, we regrouped yet again in our quarters.

It was at this point that my handler left for roughly 30 minutes, having spotted a crowd 29 floors below him. He returned, slurring something about having 70 people chanting “chug” while he guzzled 5 shots of distilled blue agave hooka-side during an impromptu last call ceremony. Things immediately degenerated at this point. At some point I was informed that I was in the presence of a genuine celebrity. Someone from something called ‘Spider Person’ or thereabouts.

I warned you that those Filipinos would appear again. No worries, they were pretty cool…

For Filipinos.

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Perhaps Grim or Chichagofinance could take a look at the following paper, which aregus against the housing bubble, based on cash flows from rent.[edit]My initial impressions:Given the lax lending in the mortgage market, the required rate of return is likely to be higher than 6% used in the paper. A mere 3% increase in home prices is going to cause many borrowers to be upside down, given the leverage used. I just don’t see how a soft landing can work, even given this data.1:10 AM”You don’t need to dive into the details of the paper to question its findings.  Its conclusions are so fundamentally flawed, I think most interested parties can merely dismiss the paper as irrelevant.That said, I reviewed the paper and believe your comment about its core model undercharging for risk is valid.Among other items, they have conveniently sidestepped the issue of the expenses associated with owning.  In a sense, their model is a Frankenstein [i.e. bastardization of finance], that uses data and cash streams from the renter’s market, prices from a purchaser’s market, and pulling risk from a financial instruments market.On page 17, they put forward the assumption that the buyer never sells, and that I would point out that is a convenient way to avoid noting that relative to their cost of capital, future home prices are by definition NPV negative.  Read: even at their unrealistically low 6% after-tax rate hurdle rate, long-term real estate appreciation is lower than 6%, so the cost of carry is negative.I am also uncomfortable with the fact that they seem to have spent more time peer reviewing this paper with financial types rather than real estate types.  Even then, the financial types are CFP’s, not CFA’s, Economist, Phd’s etc.  As someone who has dealt with economists, finance professionals, the academic community as well as the financial planning profession, I would characterize CFP’s on the whole more applied than theoretical, and certainly less analytically rigorous, so I wouldn’t be parading the review of 27 CFP’s as some gold standard.  However, do not confuse this comment with the fact that in my profession, a CFP is a valuable and important credential.  It is just that in this theoretical discussion, the author’s are miscasting the utility of experts in applied thinking.My last comment is that GIGO [garbage-in garbage-out] comes to mind.  What is the source of their market data?  The idea that they remotely make various assessments about different regional markets is laughable at best, or downright reckless at worst.  Performing data analysis while needing to put forward assumptions about the functioning of “Yahoo! Maps” ugh…..Put this one in the circular file, but market sure to shred it first, so no one is tempted to pull it out.chicago

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