Part one

Like most people, I used to save for retirement the traditional way using the stock market, with mutual funds and broker’s fees. And, like a hamster on the wheel, I was running, but going nowhere. I was tired of the rise and loss of the market and couldn’t really see retirement in my future. If you're sick of the roller coaster ride too and feel it's the big cats that take away the real money...read on. You too can take advantage of the lowest prices in real estate we've seen in 10-15 years with an self-directed IRA.

A friend told me about self-directed individual retirement accounts and that I should Google it and see if it's a fit. If not for me...for my present and future clients. As a self-employed person, I learned I can take a chunk of my retirement money and put it into an asset, like gold, notes, tax liens or, you guessed it, a piece of real estate.

If there really is a heaven...it must be here!

For me, this is the perfect storm or good stuff! There is a beautiful piece of lakefront property in New Hampshire that’s been in my wife’s family for years. It’s the prettiest, most desirable location on the lake. I proposed to my bride up there. Add to that it's the best place for me to do creative work, relax, and decompress from the pressures of life in CT and in real estate. I was emotionally attached!

​My unspoiled view on Long Pond...

When the family wanted to sell the lake house, I had an opportunity to buy the property AND I could have an IRA-tax-sheltered investment that was outside stocks, bonds and mutual funds.  I have complete, check-book control of the asset. Not somebody else. Don’t have to invest in mutual funds; I make the decision.

It follows all the traditional rules of an IRA. I must start taking distribution when I turn 70.

Most people with self-directed IRAs buy the properties for investment. Not me. This is my dream home and we plan to live there when we retire. While prices of homes are favorable and interest rates at such historical lows, it only makes sense for me to ride the appreciation of the real estate market that I know is coming.

Next week: The process of setting up a self-directed real estate IRA.

I love meeting new people and forging new relationships. It’s what I love about my job as a real estate agent. I met Brian Penry a Shoreline Communication Group luncheon created and held by Marcia Simon of MSE (Marcia Simon Enterprises, LLC), a boutique-style public relations agency specializing in health care and technology located on the CT Shoreline. Brian and I met again at my year end networking meeting held the 1st Wednesday of each month at Gladeview Health Care center in Old Saybrook.

​Brian Penry

Brian presented a book he wrote the foreword to that will certainly restore one’s faith in human nature. We mostly hear of looting, riots, or how government failed the population in question or how many died.  Clearly when you put all of this together after reading Brian's foreword and then the book, you’ll know that Brian is a special man. He cared and had the talent and energy to recognize that the words he was reading was in fact extraordinary and were written by quite an uncommon woman. I’m honored to know Brian and to have him as part of our group. 

The book I’m speaking about is titled Letters from the Ground to the Heart - Beauty Amid Destruction. This book is a series of letters to friends & family by Anne Thomas, an English Professor and 22-year resident of Sendai, Japan, following the devastating earthquake & tsunami of March 11, 2011. 

Anne makes the stories of ordinary people in extraordinary circumstances profound – capturing our collective, global empathy. This collaborative effort also includes writings by Pema Chödrön and Miyazawa Kenji, responses from all over the globe and more.

While the news coverage has stopped, life’s struggles continue there. Every penny of proceeds from sales after expenses of ‘Letters’ benefits survivors of The Tohoku / Great East Japan Earthquake and Tsunami. Give yourself and others the gift of an extraordinary reading experience that won't soon be forgotten, while benefitting Japanese earthquake and tsunami survivors in ways that matter most: on the ground and from the heart.

Here’s the foreword by colleague Brian Penry and a Anne’s last post to the “Letter’s” facebook page. Thanks for taking the time to read this blog and for forwarding it to others. Important links can be found a the end.

Letters from the Ground to the Heart – Foreword by Brian Penry 

It was Sunday, March 13, 2011, two days after a massive, 9.0 magnitude earthquake and tsunami struck the Northeastern Region of Japan known as Tohoku. While sipping coffee and going through e-mails as is my early morning ritual, I noticed an excerpt from a blog post at odemagazine.com (now odewire.com) that a friend in the UK had sent me. It was the first of what would become a series of accounts of life in Sendai, Japan following these terrible events, the ramifications of which were then and are yet unfolding – written by an American woman who has lived there for some time.

      However and rather than being predictably consumed with the statistics of death and destruction, the sum effect of her account was as though “reading” a Van Gogh painting. The words that floated up off my screen spoke of “the heavens at night” being “scattered with stars,” life in Sendai being “surreal”, and the “enormous Cosmic evolutionary step that is occurring all over the world right at this moment.” These were no ordinary thoughts – certainly not those of one processing the aftermath of tragic events in ordinary ways.

      I was moved to print this out and read it aloud at a time of sharing during church services, later that morning. It bears mentioning that I have never been very keen on organized religion, attending services only very rarely in recent years, at a white clapboard, 1700s era New England church, with a small, closely knit congregation. You could hear a pin drop as I read it, at times tearfully – to a similar response. I was still hearing from other congregants, weeks after. It was only later in the course of this project, that I would learn that this very same experience was not unique to me. 

      I searched online for this person who signed her posts at the time simply as “Anne in Japan.” I found one Anne Thomas, a U.S.-born professor of English, who after living for years throughout the world, had settled in Sendai – where she has taught at various university positions and made her home for over twenty-two years. 

      I quickly became transfixed by Anne’s posts, each an elegant yet spare homage to the simple virtues of a people and culture that has been through incredible natural, as well as unnatural disasters – not once, but many times – somehow not merely rebounding, but thriving after each, brutal challenge to their very being. 

      It wasn’t long before I found myself reaching out to Anne, who graciously added me to her e-mail list. We began corresponding, and I suggested soon thereafter that we collect her letters in a book. The purpose is twofold: to give her work a greater voice and audience, while raising funds to help survivors of the earthquake and tsunami. Perhaps notably, it is not these events themselves that precipitated her letters; it is the countless acts of human grace that followed – and which continue to inspire Anne, and all who read her words. 

      As though modest gifts in small, neatly lacquered Japanese boxes, each letter is a tiny gem. Like one in a set of Russian Matryoshka dolls, each is its own story unto itself – while fitting perfectly inside the next to create a larger story. 

      Through Anne, one vicariously witnesses a quietly dignified, orderly response to utter and complete chaos which, vs. the physical (cherry blossoms) is the true essence of “Beauty Amid Destruction.” Anne’s letters offer simple, unadorned accounts, often of the most mundane tasks – however, in ways that make fascinating the stories of people trying to function normally in the most abnormal of circumstances. They are at once a transformational tale – an illuminating journey to a greater, universally shared consciousness. 

      As you peruse the tiny sampling of responses that Anne has received from every corner of the world, you will find that I am far from alone in these observations. From New Zealand, Australia, Holland and the United Arab Emirates to France, Brazil and throughout the U.S. and beyond, Anne taps into our collective empathy – resonating with people of every conceivable age, background and persuasion. Ranging from simple messages of support to extraordinary perspectives, first-hand accounts and the aid-related initiatives of others, the responses include those of Anne’s family, friends, students past and present, and notably a gentleman named Imai Sensei, whom Anne reveres in great part for his many years and tireless efforts on behalf of Japan’s homeless – whom recent events have tested as never before.

      This effort closes with excerpts from a letter of another time, which was included at the suggestion of Anne’s cousin, Susan Brown Black, who has also contributed to this effort in profound ways. It was written by their late uncle, Henry “Had” Brown over the course of several days in October, 1945. Ironically, Had also chronicled events in and around the environs of Sendai to family and friends following disaster, albeit manmade rather than natural – while on leave as a U.S. military officer at the close of World War II.  

      It is doubly ironic, if not uncanny that the observations of Anne and her Uncle Had bracket the exact period of time during which nuclear events forever changed, and are yet again reshaping both Japan and our entire world. However and rather than delving into such bleak matters, their writings ultimately offer the prospect of hope.

      Where Anne focuses more on the people of Japan, Had was clearly fascinated by its beauty and culture. And while each writes from distinctly different vantage points, their two perspectives are separated only by time and circumstances. Both reveal one, consummate and powerfully enduring truth: that the timeless, mystical nature of Japan is inextricably intertwined with the kind spirit, patience and generosity of its people – call it their ‘cultural fortitude,’ which the Japanese seem somehow hardwired to share not only with each other, but especially and instinctively in times of extreme challenge with those around them, as well. 

      A few thoughts in closing… 

      I ask that you please keep Anne’s observations in their full context. Her positive, upbeat appraisals of efforts to rebuild should not be misconstrued to mean that the immediacy and urgency of Japan’s needs has somehow past. Many, particularly in Tohoku, the Northeastern Region of Japan – are yet in dire need of assistance.

      Lastly, my hope is that through these collected letters and more, that Anne’s message, along with those of others will now reach, enlighten and inspire larger, more diverse audiences – perhaps to think differently, more compassionately about people and cultures other than their own – and above all, to act – not only in times of need, but through small acts of kindness, throughout the precious moments of each day.

– Brian Penry 

Anne’s Latest –‘Letters’ FB page December 20, 2011

Japan is pretty much out of the news these days. But life is still far from easy here in Tohoku. Winter has settled in with freezing temperatures and frequent snow, sometimes flurries, sometimes storms. The Red Cross and Army left several months ago, so the clean up job and rebuilding are now the responsibility of each prefecture.  That work is going on continually, but slowly. Reports say it will take another two years or more before the devastated areas are ready for rebuilding.

In the meantime, people who lost their homes are living in temporary houses, whole families in small apartments, evacuation centers, a few of which are still open, and in the back of trucks or in cars. The homeless live in parks and underground walkways during the day. They walk all night so as not to freeze to death. Many people are still out of work. In fact, the jobless rate among young adults is 50% or more. Depression and suicides are on the rise. 

We have come a long way and are proud of that. But we also realize there is still so  much to do.

We all hope that 2012 will be kinder to us. They say that the danger of another earthquake lasts for a full year. So, we are still alert as we go about our daily lives. In another arena we also know that next year brings the end of government financial assistance to those devastated by the earthquake and tsunami. We also realize that jobs are very scarce here now. So, we are quietly watching, wondering, hoping for a year that allows us opportunities to work together and do all we can to make life better for everyone we in need. 

Please help:

Every penny of proceeds from sales after expenses of ‘Letters benefits survivors of The Tohoku / Great East Japan Earthquake and Tsunami.

Important Links:

​Buy the Book from Lulu.com

Official Website

​Like On Facebook

Follow On Twitter

I needed my 2010 Prius detailed in the worst way. I like a spiffy car for my own psyche and as well as for the comfort and enjoyment of clients I take to homes. Bringing my vehicle to a detailer requires my driving to the detailing venue twice and with a friend or my wife to get me there and back. The detailing company I had been using has raised prices beyond what I feel is a good value for me so discovering Marco and Diego and their new mobile detailing service was a big win-win-win. 

Being mobile they can do this service wherever  I am. In this case, I had scheduled Marco and Diego to come to my home in the afternoon one day last week. I had been visiting a friend just home from the hospital and was helping her update her Mac, iPhone, and iPad the new iCloud system and realized I wasn't going to make it home in time for my detailing appointment. No problem. I texted Diego a new address and he came to Essex home I was visiting instead. Convenience and great service from polite and competent detailers are just the start. 

Green Steam uses steam to do the job as you might guess. Other detailers are using gallons and gallons of water to wash each and every car. Some car washes recycle water and frankly don't like the smell of it in many cases. In automatic washes the car suffers the minor surface abrasions from the equipment. Steam lines up with my sensibilities. 

Green Steam uses steam to wash and clean both the cars exterior and interior.  Steam is completely safe on auto surfaces.  Moreover, steam has sanitizing and deodorizing effects of low water use is eco-friendly.

It takes very little water, less than 1 gallon per vehicle on average, and it does not cause any wastewater run-off.  Steam's washing power is truly amazing.  You will be astonished to see what it can achieve without any chemicals. Green Steam provides customers with three services:  exterior car washing, interior cleaning & disinfection, and detailing.  While others compete on price alone…Green Steam delivers much more. 

Marco and Diego relocated to the shoreline to build a better life than was available to them in a large city. They chose the beautiful shoreline for obvious reasons with many career aspirations, desires, and an eagerness to succeed. Most complain about the economy and think negatively as a result. This team thinks positively and has had the fortitude to begin a new business in a time where most would run the other way. 

You'll not find a better value or job for the $115 they charge for a complete detail. They leave no mark at the place they do their work and I hope you'll give them a call support the friendly hard working team. Call them today at (860) 304-2798 or (860) 575-5260 to book your onsite Green Steam detail. You'll be delighted!

These days with the all the negative news about students and schools and the like, it's nice to read something positive. You'll not read about how student Jenna-Lyn Geysen has bullied anyone, was not arrested, did not do vandalism, get caught shoplifting or being in court drunk like a Lindsey Lohanne or anything like that. She's just the opposite. She is smart, get's good grades, and spends her free time in creative arts and sports like few others do in high school today. 

I am proud to write about her because she is the daughter of my newest team member of the River to Shore Group, Kevin Geysen. Kevin's talent was evident when he came on board producing right from the get go. Innate talent seems to run in the family. I had met Kevin through his parents Juny and Nancy and noticed a photo of Jenna doing ballet in a photo on the wall. My wife and I love dance and she told me about her taking part in the Nutcracker Suite this past year and more. As I got to know my new team member more...the more I learned about Jenna.

I quickly learned she was tops in varsity track and field hockey in addition to being astute in other dance disciplines like Jazz, Contemporary, Broadway as well. This May Jenna Lyn took 1st place at the "Showstopper" Regional Dance Competition held in Hartford with here solo performance titled "I Am" which was choreographed by Caine Keenan, a nationally renowned dancer and choreographer. Later in July she took 2nd place just a couple of hundredths of a point behind 1st. This is an enormous achievement given the vast number of participants. 

Jenna said "The nationals is such a big step, and being in the opening is such an honor." 

Jenna doesn't know the word stop. Hard work is certainly an understatement for this young lass with boundless energy and talent. She is a junior at Mercy High School in Middletown where she is a key player in field hockey and a member of the winter and spring track team. She dances 4 nights a week for 4 hours at Dance 10 Studios in Wethersfield. She does this as she is doing her academic work, looking at colleges, and her hopes to make a career in dance. 

My partner Kevin and Jenna's dad said "This is a prestigious competition. She's been dancing for some time and this will certainly help with advancing her into the professional dancing world." 

To put the "Showstopper" event into perspective, the competition hosts over 100,000 dancers in 3 different sites around the country every year. Past participants of "Showstoppers" have included well known celebs like Beyonce, Britney Spears, and LeAnn Rimes. 

Whatever the future has in store for Jenna-Lyn, suffice it to say that her hard work and talent will get her noticed. I wish her the very best as we all do on our team here and want to let her know we're very proud. 

This week we received certainly one of the most creative expressions of thanks from Mark and Nancy Tepping formerly of Rebecca Lane in Guilford. We met through an on-line connection and we hit it off from the start. We made our plans, executed the preparation punch list, got their home on the market and had it gone in 7 weeks. We negotiated an nice deal on a model home condo in Chester for them and got both places closed as they desired overcoming the normal bumps in the road you sometimes get in today's market. 

After they settled in they had a party celebrating all that those that assisted them in their big move. They had the Pizza truck onsite that provided marvelous fare, from appetizers to dessert, and all had a very nice time.  We met family, new neighbors, and even their sales person from the Old Saybrook Barn. No one was forgotten. It was certainly a first for us to experience a loving and genuine act of gratitude of this level. During the event, Nancy read aloud many limericks. She wrote one for each professional she hired to assist her in their move. It was flattering for sure and we all felt honored.

 I felt compelled to blog about this because of the level of vitriol we see between the daily discourse on the air and in print.  There's been a serious decline of civility in the world and a decline in simple politeness. There was a recent news article on NBC news that interview a waitress who's tip was "try losing a few pounds." instead of the 15% gratuity she had hoped she would get for her good service. People on the road are in a rush, will cut you off, or won't let you in when the traffic is stiff. It's sad. 

It's really simple: If you want love, give love. 

OK...so the real reason I love this business is because of all the great people I have met and made friends with along the way. I can say the only downside is that I certainly have more wonderful relationships today than I have free time to nurture so Facebook and blogging and the occasional personal note to many will have to suffice between those rare personal visits.

Mark and Nancy, thank you so much for being a great example of what true gratitude can be. We are honored, flattered, and appreciate your gestures beyond words. May you have the best of luck in your new home and have many happy healthy years there.

I respectfully submit to you, the reader, for your consideration that the next time you're at a restaurant to leave a larger tip than you normally would and write a note, if deserved, to let the server know how much you appreciated the good service. Thank the service rep at your auto dealer, the cashier, your massage therapist by sending them a card. I recently sent a card to the manager of the Old Saybrook spa telling her what a great experience I had with staff member Eleni. I had also sent a gourmet package of cookies that I asked the manager to give to Eleni as a token of my appreciation. The next time in I was even more appreciated. Hence...if you want love....give love. That is all.

Below is Andy's 3rd Quarter newsletter on the market. I hope you find it as interesting and informative as I do:

October 3, 2011

Dear Investors:

The third quarter of 2011 saw the worst stock performance in 2 years, with global indices down precipitously.  Declining markets caught many by surprise.  When the third quarter began, investors were looking towards growing profits, excess cash on balance sheets, low interest rates and the presidential cycle, which all pointed to higher stock prices.  Perhaps these positives, which are still evident, will reassert priority in investors’ minds before year-end, an intriguing possibility.

When markets move from hope to worry, it is often violent.  The last three months were no exception. KCM portfolios had become more defensive throughout the first half of 2011; a consequence of the deteriorating macro picture that we discuss often in our blog posts.  We redeployed cash, raised from timely selling, into more concentrated precious metal mining stocks for reasons we have outlined in much previous correspondence. This move looked prescient, as most of our newly acquired positions appreciated throughout the first two thirds of the quarter. In the last month, however, gold and precious metal mining stocks finally succumbed to the pressure of the global liquidation.

Price volatility across asset class increased dramatically during the third quarter.  The S&P 500 had daily moves in excess of 1% on a record number of days for a three month period.  These were not trending moves, but often violent swings that went nowhere.  This added volatility can be problematic for position oriented money managers like us.  Our portfolios are concentrated in areas and situations we follow closely and believe in long-term.  As example, we want to own precious metal mining companies and oil and gas production not because of short-term stock price appreciation but because, if these businesses continue to generate free cash flows and that free cash flow grows, share prices should be considerably higher in years to come.

Obviously, if long term appreciation is anticipated, entry prices are paramount.  We looked prescient in our recently re-established gold mining overweight, but their precipitous declines off September highs will impact monthly and quarterly portfolio results.  From a technical perspective (Appendix A, B and C) we don’t think anything importantly bearish is happening, except volatility is increasing.  This could work in our favor in the future, during possible runs higher. Fundamentally, recent global macro concerns that are causing the harsh markets only strengthen the long term case for gold.

During the last three months global concerns—European sovereign debt risk, emerging markets economic slowdown, and US political morass—contributed to the “risk-off” trade.  We first witnessed “risk off” in the 2007 -2009 bear market when all assets except the US dollar and US Treasuries declined.  Recent market behavior is eerily reminiscent of those dark days.  Why investors rotate en masse into US dollars and 10-year treasuries yielding 2% baffles us.  A strengthening US dollar seems the more absurd of these two, although not by much.

It is clear to us that a Federal Reserve led by Ben Bernanke will do everything it can (and maybe some things it can’t) in an effort to create “good” inflation.  He and his comrades, of whom there seems to be a dwindling number as evidenced from the three dissenters in the last two interest- rate policy meetings, continue to signal excessive monetary stimulus, even in the absence of any compelling data that proves its effectiveness. We continue to expect further quantitative easing

or other innovative policy in their unceasing quest to artificially create economic growth.

Future currency debasement is as close as we know to an economic certainty.  It continues to amaze us that, even though the fiat dollar is only 35 years old (in its present iteration), and the history of fiat money is over 2000 years old, that there are still so many who rest confident that this current group of global mandarins are somehow clever enough to successfully manage this overwhelmingly complex system.  Fiat money always depreciates.  That has been its unblemished record for over 2000 years and this time will be no different.

If one expects the dollar to depreciate, then a ten-year bond yielding 2% per annum paid in said depreciating currency hardly seems like an attractive investment—yet investors continue to buy them in record numbers.  The “safe haven” status of both the US dollar and the Treasury markets are the presumed cause of demand.  We believe that is true during periodic “risk off” episodes, but the underlying and constant demand for treasuries is more a part of the global currency race to the bottom. As the dollar depreciates against other currencies US consumers, still the straw that stirs the drink, buy fewer imports.  Global growth slows.

In order to stay competitive, foreign governments try to keep pace with dollar debasement which requires them to continue to purchase US government debt.  What was at one time a synchronistic positive interrelation now looks frayed and problematic.  Will the countries with net savings, like China and Brazil, continue to support this mercantile relationship?  As inflation and internal social conflict grows in these countries we believe it will become harder for those large buyers to justify using their savings to support our debt.  If demand weakens and thus interest rates, despite the Feds repeated ministrations, rise would others, fearing debilitating losses on their largest remaining asset, rush to sell?  We think that is a possibility.  In any case, as we indicated above, we see no reason to own a low-yielding obligation paid in a depreciating currency no matter what the present results show.

Looking out to year end and despite the bumpy ride, we continue to favor owning risk assets in commodity-related sectors and special situation ideas that should react independently of deteriorating economic fundamentals.  We suspect that markets are getting close to levels where buyers will emerge.  It is possible that if a rally can sustain for a number of weeks, a year endrally can gain momentum.  Please continue to check our blog at kramercapitalmanagement.com for updates.

Andrew Kramer                   Shu Wu

      Portfolio Manager                 Associate 

Ann introduced me to J. Hilburn and she put it this way: Picture men’s suiting on a continuum with inexpensive materials, fused construction and low prices on one end, and impossibly expensive, hand sewn, fully canvassed, amazing materials and construction on the other. J. Hilburn has carefully designed a suiting product that comes as close to the end result of bespoke, yet at a fraction of the price.   Suiting is of the best fabrics, and excellent construction techniques, just like designer brands, but going one step further and better than designer – the ability to purchase sizes in 1 inch increments (rather than 2) and 7 areas of customization for every suit. 

Why is this important?  Because nothing says affluence – says I’ve made it, I’m a force to be reckoned with, inspires respect and maybe even a little awe like a monogrammed cuff peeking out of a beautifully fitted jacket of sublime material.  

But J. Hilburn is an end but not the means per se of arriving at the look that will put your best foot forward. Introducing "Style of Success" 

Founded in 2007 as Ann Lindsay Image Consulting, Ann was determined to start a new career in a creative industry that helped people feel good about themselves.  

A graduate of the prestigious Image Resource Center of New York, Ann also achieved the highest score in the 2007 Association of Image Consultants International annual certification exam. 

As Ann began working with clients she began to see her niche: Divorced middle aged men had no “feminine” resources when it came to clothing, grooming, etiquette and especially date coaching.  Men consistently were needful and appreciative of her help and her practice began to reflect that.  Working with men at her local Brooks Brothers store gave her hands on suiting experience and cemented her desire to work with menswear.  

A complete rebranding as a company dedicated exclusively to the male client occurred in the spring of 2010 culminating with the launching Style of Success website and blog, content rich e-zine and 3 e-books.  It was in the Fall of 2010 where she created a partnership with J Hilburn. 

In 2011 Style of Success joined in a strategic alliance with Vada Image Consulting for Women.  The SOS-Vada team now presents to men and women in the corporate realm – to sales teams, law firms, as well as working with human resource departments in support of employees.  

Call Ann at 203-257-8167. Visit her website to learn more: http://www.sosformen.com/ 

I network a lot. While networking I met Paul Knutsen at an event and found him to be a guy with a heart and wonderful sensibilities towards life and helping others. So, It was not a surprise to find that he runs Gladeview Health Care Center from a completely different place than most. While having breakfast in Deep River at Kristen's with Paul, he pointed to a cross that was hanging in the restaurant across the room that was made from rope in a particular fashion. He told me his father, John Knutsen, now retired for many years, was making them by the bag and giving them to pastors of churches, to homes like Gladeview, and to those he meets on his travels.

John Knutsen at his home workshop...

John worked for 30 years at Pratt and Whitney and took an early retirement that has kept a grin on his face ever since. "It takes a lot of time to do nothing and I work hard at it," John told me. He was a customer relations contact with airlines for last 15 years of his career. When he first retired and became his own boss he spent a lot of time fly fishing. Health reasons kept that from being as frequent an activity as he would have liked. John decided to focus on another activity so he started making things from rope. He learned Chinese knotting and is really good at it. He delved into knot tying in a big way and came across sailor's cross. The legend is that Portuguese seaman make these from scrap pieces of rope for the bow of their long boat for divine protection. His Navy background and strong faith drew him to make these "sailor crosses" and offer them to those in need.  

The Sailor's Cross is one of many types John ties...

John was married to his bride Marie in E. Greenwich, RI. The church they got married 52 years ago was where Marie grew up. John's Navy shore patrol brought him to the area and they met at one of the local community dances. The Pastor of this church told John how good people felt having received the crosses that he placed in a basket, free for the taking, by all who came through their doors. 

John uses a variety of line, rope, and leather to make his crosses.

John became addicted to making them and started making them by the hundreds. I also learned during my short visit with him that Scouting was in his past…no surprise. Being an Eagle scout myself…knot tying was a certainly one of scouting's mainstays. 

John gets a lot of satisfaction out of making someone happy and introducing a different energy into their lives. I'm honored to have met and talked to John and thought I'd write a small tribute to his good work. 

If you're interested in getting some of his crosses for your good work, write me an email and I'll connect you. 

CT Shoreline Housing Report

Connecticut Shoreline Residential Closings

The report below shows statistics from 2010 residential closings along the Connecticut Shoreline. It lists the number of closings, median sale price, average days on market, and % list to sale price for each town within our primary service area. 

Source of Data: CT MLS

Lisa gave each of her guests this special cookie with her logo on it. Each was beautifully presented in a cellophane bag tied off with a ribbon. 

It was 5 years ago I decided to give home staging a try to help my clients sell for more and in less time. Home staging's roots and traction came from the west coast of course and I was aware of it from the trade news I read and some blog articles. 5 years ago when I met Lisa Leonardi, creator of The Room Doctor, 70% of the listings in CA were already being staged at some level. Empty homes were furnished and occupied homes got sometimes complete make-overs. 

 Lisa Leonardi, right, with her right hand assistant Julie Cousins.

Lisa made a presentation to the brokerage I was working for at that time and her timing was perfect. I had a listing in need, TV shows were popping up dedicating themselves to the topic, and articles online and in real estate periodicals were covering the subject as well. Lisa was clearly the leading edge of home staging in our area and I for one was glad that this service was now available here. I was ready to give it a try..

Lisa held an open house at her beautiful home in Madison. She invited many of the great tradespeople she relies upon to get the job done. Karen Bernetti, a colleague in real estate and home staging, presented her new book "Ready2Sellin30Days" designed to help people prepare their home themselves in a well thought out and manageable way. You can eat an elephant...one bite at a time! Find out more at www.Ready2Sellin30Days.com.

I had just signed a listing in Waterford that the previous agency had failed to sell during their six month listing period. The Coast Guard officer and his family had already moved to their next assignment in Alaska and the modest split-level house was empty, needing updates, on a corner lot but had good bones. The price was ok but not saying "buy me, I'm a good deal in my current condition." 

One of the many beautifully decorated rooms at Lisa's home for her annual open house.

I hired Lisa on my dime as the client had no funds to contribute so I covered this one in total. I had a 6% commission agreement so I could afford to cover it with my proceeds at closing. Lisa came in and treated the hardwood floors with a treatment to soften of the areas of that clearly needed refinishing. She brought in furnishings, hung nice things on the walls, made wonderful color choices in shower curtains and other accessories to soften the sting of the colors of a bygone era, and more. Candles were used in strategic places for ambiance. The place looked wonderful and it suggested a living flow that some buyers would have seen as challenging in a completely empty state. I now had a subject home that allowed me to create professional photos for marketing that were inviting and now looked like a good deal for the asking price now. 

Lisa speaking with Ed McCaffrey from our Page Taft Real Living Essex office. 

Long story short: I sold the home in less than 6 weeks, had more traffic in buyers at the house in the first week than the previous agency had during the entire listing period, and I found my own buyer making it very easy to cover the staging expense. I got very close to asking price, and the home sold in a short period of time. I've used The Room Doctor ever since and my track record proves the worth of the great service, advice, and talent of Lisa and her staff. 

Here's what The Room Doctor offers:

Staging Consultations: A service whereby Lisa spends an hour or two (as needed for the size of the home and scope) and advises on what the homeowner should do to best prepare the home for sale. She provides a summary of that consult in writing for the client to execute on their own. I ask that my seller's do as much as they can afford and agree with. Most do a lot and it is a huge improvement. 

Staging Assistance: A service whereby she and her staff will assist the homeowner in the physical execution of staging the home. From moving furniture, hanging art, and the like. 

Full Service Staging: Get out of the way and let the pros do it all. 

Furniture and accessory rental: Sometime's there's too much furniture, other times not, and still there are times replacing what isn't working with something that will till the house sells is the ticket.

There's much more The Room Doctor offers in the way of services so check out their website at the theroomdoctor.com.

The way things look really matter....especially to buyers in today's market.

If you're a seller and your agent hasn't recommended home staging, mention it to him or her! If you're an agent looking for a great home staging company, look no further. If you're a for sale by owner individual, what are you waiting for…call us or another agent you like and The Room Doctor today and get serious about selling your home today!

The new location is inviting and convenient. 

Vitality Spa opened officially on December 9th 2010 at their new location 14 Lyme Street, Old Lyme (next to the Diane Birdsall Gallery) and to the left of E. F. Watermelon. For more info call: 860-434-1792 or email them info@vitalityspa.com

The new location exudes an atmosphere of calm and relation with it's subtle warm tones, background music, and now a whole line of Vitality Spa products to keep the relaxed feeling and healing going at home after your session ends. 

Vitality Spa offers something for everyone:

Better Health Massage™

Zen Facial Rejuvenation

Vitality Body Therapy

Yoga Therapy

Deep Tissue / Sports Massage

Ashiatsu Oriental Bar Therapy™

Pregnancy Massage

Active Release Technique (ART)

Reiki

Craniosacral Therapy

Couples Massage

Accupuncture

Meditation

There's even more so please visit their website at: "VitalitySpa.com"

There's a full staff of dedicated professionals waiting to help you and at a time that fits your busy life and schedule. 

From left: Kara Hooks, Lise Bohannon, Lindsay Eisensmith, Lesley Bolton, Dr. Carl Zapatka

My wife and I both have experienced the healing touch of Lindsay and her staff and consider ourselves Vitality Spa clients for life. Whether it be for general relaxation or to shorten the recovery from a bad back, the relief and care we receive is exemplary and welcome. 

Come visit soon and meet Lindsay yourself!

Some years ago I visited many long term care facilities while searching for an elder mother-in-law and it was quite discouraging. Often times the words coming from the lips of the representative who was selling the facility didn't match up with reality...or at least the reality I experienced with my own eyes during my tours. Many halls I walked smelled of urine and were full of equipment and the like in the halls making it difficult for residents to traverse. I simply didn't get the feeling or energy on the floor that things were as upbeat as they could be. These would be facilities that I feel are doing the least for the residents in order to fatten the bottom line for the company.  

Recently, I had the pleasure of meeting Paul Knutsen, Executive Director of Gladeview Rehabilitation & Health Care Center in Old Saybrook, CT. I met Paul at a BNI meeting last week and went to visit him to see what kind of facility he ran. I was not only blown away about how Gladeview was managed and run, but with Paul Knutsen himself. 

I learned that this energetic executive in his early forties was in the business for the right reason. When I asked him how he found his way into the healthcare industry he reflected about his youth working for the Easter Seals Foundation at Camp Hemlocks in Hebron. At 15, he felt how wonderful it was to help someone in need, he knew then and there what he wanted to do for work for the rest of his life. That feeling was too good to let go. He never looked back. “I enjoy being able to be part of the team that provides great care, getting people back to their best, or providing a great living environment for those who reside with us.”  “Making a difference in someone else’s life is what this is all about”.

We discussed a lot about long term care facilities, a bit about our country's broken state our healthcare system is in, and more. Each of Paul's responses were heartfelt, erudite, and demonstrated his expertise in the business. Paul is no nonsense, has an extreme focus on things running correctly, puts the patient first, and manages a staff that is one of the warmest, most professional groups I've personally witnessed. 

On my tour of the 3 story, 132 bed facility, which is almost always totally full, I noticed one thing right away. The halls had no smell of urine. Things were light, bright, and spotless. The halls were clear and open and the people, residents and staff, that I engaged along the way happy and smiling. This is a testament to two important things about the facility: 

1. It means that residents with incontinence concerns are well cared for and that the staff truly care for those they care for.

2. The housekeeping staff isn't hiding.  They are very present, and on top of things always keeping up on what they do. 

The floors gleam, there isn't even a small piece of debris that can be found on any floor, in any corner. 

Gladeview’s staffing model and floor management by resident needs differ from most other homes as well.  Unit managers and Lead C.N.A’s  are in place and all staff are trained specific to the needs of the residents on their units help ensure their needs are met.  This model also produces the accountability that one needs to keep a tight ship running properly and efficiently.  The entire management team is active in the care of the residents and can be found out in the resident care areas of the facility assisting and observing to make sure the optimal care is being provided.

Meet Charlene Marcotte. Charlene is one of several residents who run Gladeview’s gift shop. The profits from the gift shop and other fund raising activities are used for Scholarships for a resident of Old Saybrook.  This scholarship is given to a student who demonstrates strong community service and academic success. The residents also donate their profits to other community endeavors such as the local food bank.  When visiting Gladeview there is often 2 or 3 residents volunteering at the gift shop. 

Gladeview offers a full complement of services:  

• Twenty-four hour nursing care
• Medical Director on staff and specialists on call
• Speech, occupational, and physical therapy, dental services and psychiatry available
• Individual and group social work services for residents and families
• Distinct unit for sub-acute, short-term rehabilitation and post-acute care
• Intravenous therapy
• Contract with major insurances, HMO's and Medicare

Residents enjoy a rich lifestyle: 

• Daily menu selections artfully prepared and elegantly served
• Telephone outlets and cable access in every room
• Personalized indoor and outdoor recreational programs
• Wheelchair accessible gardening
• Canopied patio area
• Scheduled intergenerational opportunities
• Day trips to restaurants, malls, local events, etc.
• Arts and crafts classes
• Ice cream parlor and Gift Shop
• Volunteer services
• Beauty/barber shop
• Newspaper/mail service
• Library
• Regular chapel services
• Rehabilitation

In some markets prices are still dropping. Along the CT Shoreline and Lower CT River Valley prices have stabilized. I just read an article in the Commercial Record stating that CT is among the best for states for home appreciation (Read it here: http://www.commercialrecord.com/news140979.html)

Ok…so let's say you're not buying the fact prices are at the bottom and you think home values may still go down a bit. Is it still a good time to buy? YES, YES, YES, YES, YES!!!

Here's a great example why now is the time to buy your home;

You find a home to buy at $225,000 and put $25K down which has you seeking a $200,000 mortgage. Now let's say the market drops another 5% but let's just say that's the case. So let's get to some math. 

The interest rate you'll get right now is 4.25% so your numbers look like this: $200k @ 4.25% = $984 per month over 30 years at a fixed rate. However, you wait until next year and that house dropped 5% and you put the same $25K down so your new loan amount is $188,750. That's great right? If you were a cash buyer our conversation ends here. However you're not and if mortgage rates go up to 5.25% (not high by historical standards) your payment would be $1,132 per month. So buying now in the market you know right now with the interest rates we have right now would save you a handsome $148 per month putting you ahead by a grand $53,280 over the life of the loan. Back out the 5% price drop and you're ahead $42,030. It's really a temporary drop in price. I say temporary because all markets correct and if you stay in your home for 5 or 10 years this little correction won't mean much.  One thing we have been assured of is that interest rates have to and eventually will be going up as our economy improves.

I am writing this blog also because it's on the heals of a recent experience. I had a first time home buying couple in my office the other day contemplating making an offer on their first house. They got so stuck on wanting the house for about $10,000 less than I knew the seller would accept. Here's why being stubborn and wanting simply to win in one's mind may cost you dearly.  In this case I tried to point out the payment they were shooting for at their desired purchase price was $1,033. If they gave the seller what they wanted, their payment would be $1,082, just $49 more which for some is not even their Starbucks and fast food bill for the month. By waiting a few months risking an interest rate rise say to 5.25% their payment for the same house at their desired price their payment would be $1,160 or $127/month more. So winning for this couple would be losing. As one's REALTOR we're trusted advisors and it's our job to give you the facts. The decision is yours of course. In this case waiting or bogging down over this price difference doesn't make sense….at least to me. 

DID I SCREW UP BY MISSING THE TAX CREDIT? 

No, no, no!!. When the tax credit expired the interest rate was around 6.0%. So using the two examples above you can clearly see that you're actually better off now. In spite of all the glum news homes are still selling. They do in every economy. The River to Shore Group at Page Taft Real Living, exclusive affiliate of Christie's Great Estates, is getting the job done no doubt. 

If you're a buyer you can create an automatic search for homes in any area that meets your specific criteria. When new homes come to market they'll show up in your email inbox and relieve you of manual searches. It's free, confidential, and you won't need to speak to an agent…visit: CTHomesByEmail.com

If you're contemplating selling visit this site to get your homes value without talking to an age. All for free: ValueMyCTHome.com

If you want confidential info on how to avoid foreclosure or to get information on short sales visit: CTShortSaleInfo.com

Want great interest rates from a mortgage company that's honest with great service? We can connect you with the person who'll match your loan to your needs. In fact we can connect you with the right attorneys, inspectors, movers, contractors, and more. All for free and with our compliments which is quite helpful to our relocation customers for sure. 

Dear Investors:

In the third quarter of 2010 the S&P 500 closed up 11% on the heels of a blistering 9% September rally.  KCM accounts continue to modestly outperform, primarily due to our overweight gold mining companies, as gold continued to appreciate, up 20% YTD.  The 4% YTD return on the S&P does not reflect the bizarre, herky-jerky action.  In 2010 there have been no fewer than 4 swings of greater than 7% in both directions (Appendix A).  In early July the markets looked ready to embark on a new bear trend only to hold the previous support level around 1000.  The subsequent 12% rally had all the characteristics of a short covering rally: when those most negative on the markets cover their bearish bets because important technical support levels hold.  The market then rolled back over, weighed down once again by the inevitable reality of the harshness of our current deflationary debit debacle.  The market bottomed again at the aforementioned support level in late August (after another 8% sell-off) where the current 11% up move commenced.  The current rally, like the previous one, is a “reflationary” trade: a “risk on” mindset.  The current meme, QE2, widely anticipates further Federal Reserve easing and monetary stimulus.  Unfortunately, we believe this new attempt by the central bankers will inevitably fail.  It remains our contention that while brief periods of calm and optimism are possible, there is no magic elixir for what ails our economy.  We continue to anticipate difficult and volatile markets for years to come.

While Appendix A highlights the large swings that have characterized the market in 2010, Appendix B shows a longer-term picture that reflects the trading band that has transpired for over a year.  Apart from a brief attempt in April to break out to the upside, which was quickly and emphatically rejected, the market has meandered in a well defined trading range.  The difficult trading environment reflects the opaqueness of future outcomes.  There are many more questions than answers.  For the remainder of the letter we highlight three areas that are critical to understanding potential outcomes.

Perhaps the largest and most important unknown is the future direction of interest rates.  The Federal Reserve continues to firmly state that low short term rates will be with us for the foreseeable future.  There is little doubt that they have the necessary tools to insure this outcome.  Perhaps we are alone in our skepticism, to paraphrase the great American novelist John Steinbeck, “the best laid plans often go awry.” 

The latest US Treasury data list approximately $2.4 trillion in federal publicly-held debt maturing within one year.  This is approximately three times greater than any previous yearly maturity. Will the market be able to absorb this gargantuan supply (not to mention the trillions of debt financial institutions will need to refinance as well as the borrowing needs of state and municipal governments) and keep short term interest rates at generational lows?  Chairman Bernanke assures us he can.  If he is right—and we are not sure he is—it would mean another large round of money printing (quantitative easing is the new Orwellian term for this) which will result in new lows for the dollar and highs for gold.  One reason we suspect that keeping rates low is not a high-probability outcome is the enormous faith bond investors have placed in this outcome.  Fund flows in 2009 and 2010 have seen large moves out of equities into bonds.  The size of the crowd (enormous bond inflows) strongly argues for caution.  Simply put, if all these investors are right at this extreme, it would be the first time ever that such large flows in one direction correctly forecasted future prices.

Another area where large unknowns exist, along with a uniformity of belief, is China. Chinese economic growth continues to be an important theme in most investment managers thinking.  Strength in emerging markets and commodities is generally attributed to the voracious appetite of this new economic giant.  At KCM we are very familiar with this theme and have used it ourselves to justify our long-term belief in commodity investing.  We are much less sanguine today.  The Chinese growth story is certainly a major economic force that will continue for many years; however, recent data and commentary from experts in the field show some potential cracks in this view.  Growing income disparity has led to social unrest and large wage concessions in some industries.  In addition to wage inflation, real estate prices have appreciated rapidly; this also concerns authorities.  Environmental problems caused by breakneck industrialization combined with reports of excess capacity in certain industries indicate the potential for a concerted effort by Chinese authorities to slow down economic growth.  The potential for Chinese authorities to put the brakes on their torrid growth trajectory could have large consequences for global growth.  We also note that within the equity sector, emerging markets is the only sector enjoying inflows.

Finally there is the issue of the huge fiscal crisis in many of our states and how these deficits will impact future employment and federal spending projections.  There are a number of negative economic consequences that seem probable.  Perhaps the most consequential of these will be the negative drag on employment that strained state budgets will cause.  Since the onset of the financial crisis in 2007, private payrolls have declined dramatically but some of this retrenchment was mitigated by state and city governmental hiring.  This trend is over.  As states’ revenues continue to decline, state and local employment will suffer.  In a Wall St. Journal op-ed, Meredith Whitney estimated “that austerity measures will cost between one million to two million jobs for state and local government workers over the next 12 months.”  It is important to understand that talk of additional stimulus is illusory.  Any new stimulus approved by the Federal government, albeit an unlikely possibility at this juncture, will be needed not to stimulate per se but to maintain current programs and spending.  

Our list of concerns and questions is much longer then the three we discuss here.  Perhaps the hardest thing for us to understand is why there is not more outrage, social acrimony, and hostility against the current entrenched power structure.  Perhaps we are again just early in understanding what the probable outcomes will be.  We note with foreboding the debacle that is unfolding in residential housing.  First there were the homeowners who legitimately couldn’t afford their homes and stopped paying mortgages.  Next came the “strategic default” when the homeowner, acting rationally, realized there is no economic value in making their payments if their house price was under water.  We now see large financial institutions announcing foreclosure moratoriums.  Why should anyone pay their mortgage?  Perhaps this is civil disobedience in the 21st century?

Obviously this letter, like many of our previous ones, continues to rationalize our long-term bullishness on gold. We are no longer the lone wolf singing gold’s praises, however, and while we have no expectation that we are close to a long term top we do worry that the current ubiquity of bullish opinion argues for a correction.  We are watching closely and might try to hedge some of our exposure to help mitigate some volatility in the days ahead.  In other news, we are now fully ensconced in our new home at Northeast Securities.  Our new partners continue to impress us with their level of professionalism and friendliness.  It is with a heavy heart that we close this letter with the news of Shu’s father’s passing.  It was as sudden as it was tragic.  Our extended KCM family has been a tremendous support for Shu during this terrible time and we thank all of you for your kindness.

Andy Kramer

Portfolio Manager

This blog is on what irks me most about the media these days. They don't really cover things that expose the hypocrisy and abuse from thieving CEO's and politicians alike. It seems like the last bastion of radical thinkers and those shining a light of the truth is left to folks like Jon Stewart. A few weeks back there was minimal news coverage on homeowners doing strategic defaults on their mortgages. A strategic default is where some one who can actually pay their mortgage payment defaults because it makes no short or long term sense to keep paying for an asset that is worth so much less than the balance they're paying down. Businesses do it all the time. Many businesses don't hesitate to simply not pay a vendor or keep to an agreement that no longer works for them. They selectively screw a few people they promised to pay to fatten their bottom line and to turn towards more profitable situations…even thought they could have been honorable kept to their word. 

I was blown away by the true and humorous spot that exposed the Mortgage Banker's Association's hypocrisy. After thinking about it, I wasn't surprised. It's the status quo of the power wielding CEOs and politicians doing the old do what I say not as I do deal. So here's the story:

Hypocrite John Courson talking out one side of his face...

The Mortgage Bankers Association bought  a building for their headquarters 3 years ago for $79 million dollars with just 5% as a down payment. A real sub-prime dream deal that no doubt was packaged up with the rest of the crap they sold to investors, retirement accounts, and even other countries. The very sliced and diced crap they shorted because they knew it was going to fail. The Mortgage Bankers Association most likely could have continued to pay their payments but decided to default on their loan and walked away from it’s headquarters in Washington DC because it was so underwater.  This does have a familiar ring to it, no?

Many homeowners over the past few years have been dealing with the very issue with their slice of American pie, their humble abode, their home. For most homeowners there's significant anguish, guilt, and shame. There's also a fair amount of fear. They may ask themselves questions like: Where can we go?  What can we rent? Will anyone rent to us after with my credit is trashed from this default? Will I ever be able to buy another home? All legitimate concerns for sure. 

However, CEO, John Courson of the Mortgage Bankers Association added to the emotional burden for these homeowners in an interview about people deliberately walking away from their mortgages. He said that it was a “moral imperative” that homeowners need to continue to make their payments. (Mostl likely a position driven by his need to be overpaid for his services). This is an amazing statement coming from this pedantic, narcissistic hypocrite that strategically defaulted on his MBA headquarters loan that screwed the investors who bought their mortgage of $75m!  

So where did the MBA go? They rented just a few blocks away and they no longer have the nastily underwater property on their balance sheet. 

Am I advocating Strategic Defaults?  You bet because it's done by the very corporations who are buying elections and dismantling our middle class. I can't stand on ceremony and state that I don't advocate them when the CEO of the MBA has done it on a huge scale and represents the very industry that's party at fault for where our housing market is.  

My main message here is that if you are having trouble making mortgage payments, then a short sale may be your path to getting out with the least damage. You need a real hardship here. Get help sooner than later in this case. Visit: http://CTShortSaleInfo.com and https://www.hmpadmin.com/portal/programs/foreclosure_alternatives.html. 

If you can afford your payments and are considering a strategic default consult with your accountant and lawyer and weigh out your options carefully. Create a plan that will be solid for the future instead of sitting and waiting for things to happen. 

Want to laugh and get the sad truth that the real media wouldn't report? Watch the Daily Show's report about the Mortgage Bankers Association Strategic Default. It’s about 5 minutes and worth it.

If your a member of the Mortgage Bankers Association and don't like this blog. Too bad. The truth hurts. If you're not then you'll probably agree with me 100%.

It's been a while since I had the time and health to write a blog. I love writing blogs so I'm glad the Lyme disease my other maladies are behind me. I did get well enough to travel abroad for a couple of weeks in Toscana. It is here where the lifestyle is a bit slower and the norm is to prepare and eat foods that are in season and local. The food was wonderful whether we dined in restaurants in Toscano, Pisa, or Marche. It was fantastic. 

Ristorante Cateni is a family restaurant in Orgia, Tuscany, Italy that is the epitome of simple and wonderfully flavorful dishes made from local ingredients. 

It is this commitment to eating local and fresh that separates their restaurants from many of ours. It's also why one can't really duplicate Tuscan food in the US. It's about the ingredients. While you can't duplicate Tuscany here, you can eat as well as you can with off the hook taste and over the moon quality. Just buy local meats, produce, breads, eggs, and the like from local producers. You can certainly make getting local goodness easy by going to CT Farm Fresh Express (ctffestore.com) and order your food from over 35 farms and have it conveniently delivered to your door all year round. Which brings me to what I really want to put out there. 

A wonderful farm I sold last year in No. Windham that will soon be a pick your own berry farm. They should produce blueberries in quantity for the first time

An opportunity for the right farmer

I have a gentleman who is seeking a farm. But not just a farm. A farm with a farmer. So I'm more than just buying a working farm from some moving on or land to start one, I am not  looking for just the physical part of a farming operation but a person who fits with my investor's sensibilities, goals, desire to have a sustainable farming operation, with some but little hands on himself. This farm can be located anywhere in Connecticut. 

Here are some scenarios that would work. Call me if:

1. You have an existing farm and want a cash influx, stay on the farm and work it. It must be large enough to allow a residence to be built for the gentleman to live in during the times he wishes to be onsite. The farm must be at least 100 acres to be considered of have the ability to be expanded to this size. 

2. You're a farmer or one with the skills to be one and you always wanted to have a farm but no funds to buy one. You'd be considered when we locate the physical farm. 

3. You'd like to sell your existing farm, preferably currently working, or the 100 acres we're looking for to create one. 

4. You currently own and operate a farm and don't have the funds to expand it to 100 acres and are ok with the aforementioned conditions. 

5. I'm open to creative ways to make this work for my investor so call me with what you're thinking about. 

I think you get the idea. I'm looking for a 100 acre farm with a farmer willing to partner with my investor interested in organic and sustainable farming whereby the investor will have the ability to build a place to live during the limited hands on time he wishes to have. 

My other networking strategies have failed to locate either the appropriate property or partner and hope this blog will do the trick. Contact Mick Marsden via 860-334-1379 or email at mickmarsden@me.com if you are the one or can connect me with the person who is. 

He attempted to try to short sale the house himself to avoid paying a commission. The bank told him to go get represented. Why? For one because they want a professional handling the negotiation and second, the bank pays the commission and not the seller who is obviously in arrears.

If you're underwater and behind in payments or it looks like that's where you're going you should consult with experts immediately. If there are two mortgages on the property this further complicates the process and extends the amount of time it takes to get everyone on board, but we have been successful in getting the sale closed more times than not.

Although banks do not have to follow the new government guidelines, HAFA (Home Affordable Foreclosure Alternatives Program) offers some incentives line $3000 in borrower relocation funds, $1,500 to servicers to cover costs, and up to $2,000 for for investors to allow proceeds to be distributed to subordinate lien holders.  The official Fannie Mae site that has this info and more is below:

https://www.hmpadmin.com/portal/programs/foreclosure_alternatives.html

The most important step in deciding if selling short is what is best for you is to become as educated as possible. The HAFA site above is a great place to start.

If you're a homeowner looking for a confidential consultation or further information without speaking to anyone then visit:

CTShoreSaleInfo.com. 

Get all the information you can so you can decide on what's right for you. 

I'm delighted to be allowed to post his monthly newsletter on my blog and I will look forward to sharing his insights with you each month. 

If interested in contacting Kramer Capital Management directly, send me and email to: mick@pagetaft.com and will make the introduction. 

Here's Andy's last newsletter: 

Dear clients, friends, family and, I hope, a few prospects:

Will the stock market high registered in the second quarter of 2010 (April 26, with the S&P 500 at 1220) be the high for the year, and possibly years to come?  As longtime readers might guess, we believe that is quite possible and will detail some of our reasons in the forthcoming paragraphs.  Our 4/1/10 letter forecasted increased volatility and more bi-directional markets.  Little did we expect volatility to increase by 40% during the quarter and the S&P 500 to decline, at its nadir, over 12%.  The fact that our accounts were positive for the quarter, and year-to-date, corroborates our 4/1/10 message that only those managers willing to short, hedge, and sell will have the tools necessary to achieve positive performance going forward.  While we, of course, are pleased with our results we remain vigilant and humble as we fully expect markets to become even more volatile and challenging in the months and years to come.

Over the years we have used these letters to detail our concerns as unbridled monetary and fiscal policy begat wanton speculation.  During the crisis and its aftermath we have focused on the potential unintended consequences of the haphazard, ill conceived, and politically motivated responses.  One of our favorite strategists, Kiril Sokoloff of 13D Research, titles his missives, "Thoughts on the end game"; we feel this is an appropriate turn of phrase because what we will witness over coming years will be the destruction of the present system and the eventual emergence of its successor.  There are many potential paths and outcomes and we will not pretend to be able to forecast how this crisis will (continue to) unfold, but we intend to stay focused, alert, with both hands on the wheel. And we plan to have the physical, mental, and capital resources to invest in the next growth cycle when it comes, because another cycle always does.

It is true our outlook has become more apocalyptic, if that is possible, as we survey the present landscape.  Simply put, there is no way to grow our way out of our present condition.  More likely will be wholesale debt repudiation and/or massive monetary inflation or perhaps a combination of both.  We have discussed in detail, over many letters, the myriad economic imbalances that exist in today’s world. Nonetheless, there are so many gargantuan examples of the untenability of the current situation that we will discuss it again.

According to a recent report written by the United States Government Accountability Office (GAO), "roughly 93 cents of every dollar of federal revenue will be spent on the major entitlement programs and net interest costs by 2020."  What this government issued report tells us is that in only ten years time, .93 cents of every $1.00 of government revenue will be used to fund Social Security, Medicare, Medicaid, and interest costs, leaving .07 to fund defense, homeland security, welfare, unemployment benefits, education etc. etc.  We know this is not possible but we don’t know how the problem will be resolved.

What about the precarious state of American states?  A recent report from the U.S. Center of Budget and Policy Priorities estimates that in fiscal 2010 the U.S. states collectively posted a near $200 billion budget shortfall, equivalent to 30% of all state budgets, and that is with $135 billion federal emergency bailout assistance.  The situation of the states is even more precarious than that of the federal government because they cannot print their own currency, and because they have a large number of fixed costs which continue to expand.

As dire as the current projections are, the possibility of their being understated is real, as the demographic tide of aging baby boomers compounds the current problems.  As our largest generation moves into its retirement years we should see tax revenues weaken and social safety-net obligations increase.  As Graham Fisher’s Josh Rosner wrote in a recent report,

These boomers are now moving to become the largest tax on the social safety net.  The largest generation in U.S. history will retire with less equity in what has historically been the largest retirement and intergenerational wealth transfer asset for most families—their homes.  In many cases, these people will have no new personal savings when they reach the end of their working lives and will essentially become wards of the state.  This increased burden on the U.S. Treasury, in a decade, is the largest unconsidered impact of the current crisis.

When will our credit markets begin to unravel is just a guess, but one should look to the recent credit market turmoil in Greece as an indication of what we should expect over time.  Much is written to the effect that these problems will stay localized in the PIGS (Portugal, Iceland, Greece and Spain) and potentially Britain as well, but that we in the U.S. are safe because the dollar is the world’s reserve currency, we are the most powerful military force, etc.  To that we simply say "balderdash."  As we have said before and will say again, when a credit bubble blows there is no escaping the eventual pain and suffering that ensues.  It might not be evident in today’s market but it is short-sighted and financially ignorant to be unprepared for the eventual credit debacle that will unfold sometime in the future.

Unfortunately the list of problems does not stop there.  The perilous fiscal situation in Europe, rising social unrest in China, the percolating ethnic and religious tensions in 

Afghanistan, Pakistan and now Kyrgyzstan is now suddenly dwarfed by the potential devastation occurring in the Gulf of Mexico.  We will not delve into the potential nightmare scenarios we believe can unfold as this catastrophe grows.  Suffice it to say that we are already a weakened power and this crisis can only exacerbate our decline.

How to manage a portfolio in this environment?  There are always options and possibilities, which is what makes our job so endlessly fascinating and challenging. Whether it is a special situation, undiscovered by the market, or a tactical move contrary to prevailing trends (our most recent example of this was our quick strike this quarter in the volatility index—VXX), we are always searching, studying, and learning to position our portfolios correctly.  The one area that has been and will be our preferred overweight, perhaps for years to come, continues to be the gold mining sector.  We see gold trading at all-time highs but we believe that is not yet reflected in the gold mining sector.  Appendix A is a chart comparing the gold miners to the price of gold.  The chart shows that for the first 6 years of the current gold bull market the miners fluctuated between overvalued (red line) and undervalued (green line) in a well defined band.  The global credit crisis has disturbed this relationship.  Even a move back towards the lower undervalued band, which we believe is quite probable, will greatly enhance the value of our portfolios.  We continue to believe that when the current financial architecture fails, the rush to own gold will remind us of the internet frenzy at its height.  Anecdotally, we remain quite comfortable with our overweight positions as we have yet to find anyone we talk with who shares our position.  The more we get laughed at or dismissed, the better we like it. 

Please note the change in our logo and stationery, courtesy of my sister Rebecca, web-site designer.  In addition, please update your records to reflect our new contact information.  Rebecca is also working with us to build a web-site which will archive our letters from 2006 to the present.  We plan to be updating the site regularly to include commentary, charts and quotes and to build it out as the year progresses, so please bookmark it on your browser and check in with us periodically throughout the quarter.  Thank you for your continued support.

 Andrew Kramer Shu Wu

Portfolio Manager Associate

Appendix A