Rediscovering Sugar Tax

For some odd reason today, I just felt like dusting off OMD's Sugar Tax and giving it a spin. I remember having a Facebook conversation about the CD with an old friend not too long ago. I then remembered why this is my favorite OMD album. Yes, their singles album with Paul Humphreys is their most popular but I would argue that Andy McCluskey's solo effort with Sugar Tax is the most beautiful. Sugar Tax is one of early electronica CDs that convinced me that electronic music does not always equate to cold and sterile.

I think I just have a weakness for melancholy music. From the jilted lover in "Was It Something I Said?" to love not returned in "Then You Turn Away" to the heartbreaking, closing track, "All that Glitters" - I just love how the unusual title of this album makes perfect sense after you listen to the CD - that for the "sugar" of love, one pays dearly. Now, not every song requires a box of kleenex. Part of what has made Sugar Tax age so well for me is the variety. There are upbeat songs like like "Pandora's box" to the cover of Kraftkwerk's "Neon Lights." Such a wonderful album from start to finish.

Seagate redeems themselves

Back in Jan, my Seagate 7200.11 500gb bricked . Seagate had really fumbled in their initial handling of the issue and so I intentionally waited until the dust had settled before deciding on my options. So after sorting through all the noise, the rants, etc. I came across this great thread on the "data recovery" process.

Long story short, I received my drive yesterday from i365 and it works great! All my data appears to be there too. The turnaround was pretty fast. Sent it in Monday evening, i365 performed the recovery Tue, and I received the drive back yesterday.

I had already moved on to a WD 1TB Black Caviar so I guess I will relegate the Seagate as a backup drive.

The brighter side

I was thinking today that as long as I have a job, I kind of like this deep recession. More shopping deals. Longer time to accumulate on oversold equities. And more downward pressure on home pricing leading to more affordable housing. (Edit: yes I know the above comment is a bit short sighted..but humor me)

Speaking of housing, we've been looking, looking, looking(!) at bay area home prices. Right now, I am thinking 2010 could possibly be an OK time to purchase a home. The investment club at my work thinks 2011 is the ideal year to start looking. With all the "it's the end of the world!!!" headlines and overall uncertainty, I don't think there is a need to rush this year. For a long time I've asked myself and others what made bay area housing so high even after the dot come bubble burst. I am now in the camp that thinks bay area home prices did not dramatically fall after the dot com bubble due to all the "easy money" from the relaxed lending practices (sub prime, Alt-A <--> CDSs) coupled with stock options. But now lending practices are much tighter and stock options are largely a thing of the past for many people. I guess the wild cards are the unemployment #s from this housing bubble burst and how much cash is actually on the sidelines.

I just had a property manager come look at our house this morning and will be advertising soon. Hopefully we will find a good tenant to move in as soon as we leave.

A chimp can do no worse

That was the conclusion a friend and I had reached today in predicting what the economy and the stock market will be like in the coming years ahead.

So far I have not found strong consensus from the "experts" on a bottom..

1. Harry S Dent on Fox News who predicted the Japan crash in the 1990s thinks a Great Depression is coming. I thought the link to demographics is an interesting perspective.
   
2. Itulip recommends gold and short term T-bills until things stabilize (although the price of gold today vs last month seems to point that it is not a good hedge against the stock market). We are already worse than dot com and could be half way to Great Depression losses.
   
3. Not all doom and gloom. Niall Fergusson believes that this isn’t the end of the US but more likely an opportunity for the US.

I'm really tempted to break from discipline and reallocate majority of of our 401K holdings to bonds now. It's not an easy thing to decide since I know that missing key "up days" hurts long term performance and at the same timem long term charts of the indexes reveal plenty of head fakes. Today's drop is really testing my belief in buying and holding for the long term. I think what scares me right now is that the US indexes will follow the behavior of the Nikkei 225. 19 years after the crash of 1990, and it has not recovered from it's peak. I am still trying to understand the similarities and differences (if any) between the Japanese government response and it's effects back in the 90s vs US government response today.

Edit 3/3/09: Today, I was looking at the historic S&P 500 P/E . I think the historic PE for S&P 500 is around 10? And from the chart , the average P/E during a recession is around 5-8. Right now S&P500 PE is around 12. So to get to 8, S&P500 would need to go to 450-500 level. So it would not surprise me if the indexes fell even further before coming back up. As to when, is anyone's guess (including a chimp).