Fave Run - PIT

On of my favorite places to run is the Montour Run Trail, near Pittsburgh, PA. Whenever you can catch it on a beautiful fall afternoon, like the one we had today, it can't be beat for a place to click off some miles and unwind after work. The trail section that I use whenever I'm in town follows the run (a creek to us Southerners) past wooded hills, over a rail bridge and through a train tunnel. The surface is near perfect, the grade near flat, and you almost always cross paths with fellow runners, cyclists, dog-walkers cross-country teams or power walkers. There are parking spots interspersed along the trail for easy access. I always hope for decent weather just so I can run here.

Update: Added photo

Superbike Family

I'm looking forward to watching this...

Motorcycle Show 1953

Impressive riding...

Real Estate Woes... or Cash is King

For all the news about the simultaneous meltdown of the financial and housing markets, it is still sometimes difficult to know which precipitated the other. Both were clearly out of control. The resulting mess is doing just what it is supposed to do, bring rationality to the market. That will happen without government programs, bailouts and superfluous regulations. Politics aside, the current market is an excellent opportunity to buy, if you can manage it. Bargains abound, especially in the foreclosure market. My wife found this property by chance really, while visiting a friend. Kudos to our agent, Mary Spillman, who worked very hard to help us pull this deal together. You can email her here if you’re in the market.

The house that we recently purchased is an amazing value as we only paid 62% of its appraised value, and that appraisal was rather harsh. Granted, the home needs extensive repairs, but I fully expect the home to appreciate another 60-70% once the renovations are complete. I don’t intend on selling the home, but it is nice to have a long term investment make such impressive short term gains. It builds my confidence and motivates me to do the work knowing that at least on paper, I’m earning a good return on my work. The short term payoff for me will be the 35% loan to value ratio, the improved cash flow from having a mortgage payment that is one-fourth my current home and a home that I hope to own free and clear within 7 years.

The greatest challenge was arranging the financing because contrary to government bailouts designed to improve lending, the market has other ideas. Excellent credit scores and low debt qualified us for the loan with 5% down, but once it came time to underwrite the loan, we ran into problems. First, no one believed that we are actually intent upon moving from a recent 3100 square feet home down to a 1700 older one. We had to write letters to describe the hows and the whys of our decision. Next, no company would underwrite the mortgage insurance (MI) despite the fact that we fully qualified in every way. It was impossible to get, either private or FHA. Our only solution was to put 20% down, bypassing the MI market completely.

Of course, putting that kind of cash down drained out reserves and took money that we had planned to use for the repairs. Speaking of repairs, as condition to receiving the loan, I had to write more letters promising to do certain ones within 2 weeks of closing to appease the lender. Despite all of the headaches though, our loan officer, Keith Johnson, was great. He always kept us informed and updated on the process and helped smooth the way.

At the end of the day, we ask ourselves if we made the right decision, if the potential payoff is worth the risk. Only time will tell, but for now I am excited about the future possibilities. On NPR this morning, they reported that the sales of foreclosed properties is on the rise. This is good news if we’re ever going to turn the housing market around. It’s simple Econ 101, supply and demand. Forget the news and the pundits, capitalism is alive and well. It isn’t always pretty, but it is the best possible way for individuals to determine their own destiny. Markets work if we let them, and I, for one, would not have it any other way.

Indigestion?

You are what you eat, so the saying goes. In a sense, that is true. We are in a very real way the sum result of our choices. We are all free to choose, but we are not able to choose the outcomes, the consequences of these choices. Certainly, people make choices based on assumed outcomes, even hoped outcomes, but unless those outcomes are based on reality and truth, the outcomes can vary vastly from our hopes.

How do we judge the value of a person? The things that give our lives value, are those actions, freely given, which have a positive impact on the lives of others.

I write this as a preface to a recent decision that my wife and I made to buy a new house. Our goals were fairly simple. We wanted to reduce the amount that we spent each month for our mortgage with the expected outcome being a home that we pay off much quicker than 25 years remaining on our current home. We expect that we can pay for this home in 7 years and still reduce our monthly mortgage payment by a few hundred dollars each month. A primary outcome we want is a home that we own outright that provides physical and financial security no matter what happens in the future.

Another goal was to simplify our lives, consume less, use less space and energy. We expect to lower our overall energy consumption by living in a smaller space, especially if we install more efficient HVAC equipment. By freeing up income, we expect to be able to renovate the home and make the living space pleasant by adding upgrades that we would never be able to afford in a larger space.

Another primary goal is to be able to spend more money on the things that are most important to us. Travel, hobbies, activities for our children, charity and other worthy causes that make life more valuable.

The end analysis was that we are currently spending too much for the house we are in now, and that it makes more sense to be housed more modestly, in order to live more richly. Why do we choose the house and the neighborhoods that we choose. In part, it is the status we perceive of living in a particular place that influences our choice. Society pushes us towards these choices because we perceive social status as power. I resist the idea that status determines a person's worth and value, both on a individual and communal basis. The great thing about the US is that we are still free to make our own choices, even if far too often we allow others undue influence in the process.

So, Jacqueline and I have decided to back up our words, and the values that we claim, with action, and with our pocketbook. We are risking our life savings by purchasing a house. I hope you’ll join us as we go through the process of turning it into our home. Hopefully,we didn't bite off more than we can chew.

Freedom and Education

Article IX of the Constitution of the State of North Carolina recognizes the importance of education in maintaining a free and healthy democratic society.  Section 1 reads:

Section 1.  Education encouraged.

Religion, morality, and knowledge being necessary to good government and the happiness of mankind, schools, libraries, and the means of education shall forever be encouraged.

Section 9 of that same section reads:

Sec. 9.  Benefits of public institutions of higher education.

The General Assembly shall provide that the benefits of The University of North Carolina and other public institutions of higher education, as far as practicable, be extended to the people of the State free of expense.

 While the state has done a good job of creating a good system of Universities, Community Colleges, public schools and libraries, the General Assembly needs to do much more towards fulfilling their duty in regards to section 9. Tuition prices have risen, often dramatically out-pacing inflation over the decades, putting high quality  education out reach for many citizens of our great state. No citizen of our state should be required to graduate from an institution of higher learning with a mountain of debt. The high cost of education places an even greater debt on society. First of all, the expense often discourages people from seeking additional education. The lost opportunities and lower capacity to improve productivity carries with it real economic costs. Moreover, the middle class is especially hurt by the high cost of education because they are often ineligible for government aid offered lower income families and also unable to pay for higher education from their own funds.
Another burden resulting from the high cost of education is increased poverty. Despite the many opportunities for student aid, many poor families forgo higher education because they are intimidated by the cost. Instead of seeking more ways to decrease the cost for the poorest students, the General Assembly should hold to its mandate of encouraging education forever through free and extremely lower cost education. By fostering a culture of education wherein all citizens are equally encouraged and provided with the means of improving skills, gaining knowledge and increasing wisdom, the General Assembly will increase hope, reduce poverty and promote general peace. Everyone knows that as the general population becomes better educated, many social ills decrease.
Education could then become the centerpiece for nearly all of the social programs run by the state. Non-violent offenders should be offered opportunities to go to college or to learn a trade rather than go to jail. Welfare aid should also carry family requirements for the pursuit of education. As individuals and families focused more on education, they would have greater earning power in the marketplace. The need for aid would diminish and tax revenues from a healthy innovative economy would increase.
Free and low cost opportunities for post secondary education would alleviate citizens from the crushing weight of debt that accompanies today's graduates. Ever-increasingly, student loans are crushing the ability of even professionals to meet their families' needs. Debt for education offers diminishing returns as graduates are often unable to practice in their fields of expertise because of interest payments. High personal debts, even for education, create a drag on the economy. In fact, because of student loans, higher education may be a fast track to more poverty.
All communities should band together to pressure to the state to fulfill the mandate of our forefathers. Our hopes for a free and prosperous society rest upon access to good education. Wise founders of our state understood this. That's why the University of North Carolina was the first state university in the US. Let's leave a legacy of education for our children and our children's children forever. Make education free.

The Swiss vote to ban minarettes...

The Swiss people recently voted to ban the building of minarettes. People in western nations are waking to the fact that we are at war. This war is not with Iraq, Afgahnistan, or even Iran. This war is against political and radical Islam. Western nations have long accepted Muslims seeking political and religious freedom. What the Swiss have declared with their vote is that while they are willing to accept Muslims in their country (it is after all their country), they are unwilling to accept an Islam that would alter traditional Swiss political and social values. The expectation is that if you move to Switzerland, you are expected to adapt to the Swiss way of life. You are not precluded from worshipping God however you wish, so long as you do not expect to alter the larger society to conform to your ideals.

This complex issue demands more discussion and debate. I am among the last people who would dream of restricting someone's right to live and worship as they please. However, that being said, no one religion has the right to impose their political views on the larger society, whether we are talking about Evangelical Christians, Radical Islam or Humanists. In a democratic republic, the majority rules. There are sufficient protections to preserve the rights of any minority without granting them Super-rights and special privileges. Once that happens, you no longer live in a democracy. The Swiss democratic tradition dates back over five hundred years. That's why the Swiss people went against the advice of their own political elite. They understand that if they do not stand against political Islam, their own traditions will be no more. For over 1000 years, this has been the way Islam has spread - by forcing others to accept their "superior" society, and once their numbers permit, by the point of the sword if anyone dares to dissent. I was talking with an Iranian friend this week who taught me this lesson. The Muslim invaders, he told me, took political control from the native Persians, then over the next several decades, systematically forced the people to adopt Islam. While he finds great beauty in many of the teachings of Islam as a way of life (there are many similarities with my own beliefs), he is much less enthusiastic about a society where the political rule is sharia law. This is, I think, the distinction the Swiss voters are trying to make.

Check out this article in the Christian Science Monitor for more perspective on the Swiss vote.
CSM Article

[Posted with iBlogger from my iPod touch]