May 10th, 2008
Posted by Mark Clawson
I lost a good friend recently, his name was Don Thomson.
Don was a wonderful man who cared deeply for his family and his friends (which were many). I met him at the College Club of Seattle in 1976. We played a lot of Gin Rummy and that is where my memories rest. There was myself, Mark the Shark, The Gin God, Hamburger, and Don the ____ and Marsh.
We all have memories that will live on forever.
He loved to fish and spent many a year in Alaska. He would bring back his catch and distribute it among his friends, he was a jewel of a man. He had Barbara his wonderful wife and two great sons.
His closest friend was Marsh who he shared and office with. For some reason he would call me Marsh and, who knows, it always made me smile. Marsh is a good friend of mine and it was what it was. Good friends love this stuff.
Here is a story from a friend of Don’s:
I remember one day about 10 years ago when Dean Ingram, Don and I were fishing on the Arolik River in Alaska. We were catching Silver salmon, one right after another. After a time we all spread out along “George’s Hole”. Don, however, while moving to a new spot in tall grass, stepped into a hole and fell headfirst in the river making a perfect barrel roll.
He came up moments later sputtering, but with a sheepish smile on his face and climbed back on the bank.
Dean couldn’t help observing, “Well look at that, the Greatest Fisherman in the World fell headfirst into the river”. Don observed, “at least I know where to find them”. He was soaking wet, but this was just a momentary set back. He rung out his clothes got put together again and within 15 minutes was solidly hooked into another salmon.
He will be missed but he left many memories that we can all fall back on.
Love you Don.
April 21st, 2008
Posted by Mark Clawson
The picture above is a shot taken from Mt Charleston Lodge. We don’t have any oil rigs but like everyone else in the world we need our gas for our daily lives.
Last week we received a call from Business Week. They we’re interested in our thoughts about the real estate market in Las Vegas and they spoke to my partner Colleen Jane McGrath. Colleen spend exactly 11 minutes on the phone with businessweek.com and they gave her a paragraph in an article that appeared last Friday on businessweek.com. You can click here for the article..
That same day I read an article by Ed Wallace on the businessweek.com website that really caught my eye. The article was entitled “THERE IS NO GAS SHORTAGE”.
I find it strange that you don’t see this reporter interviewed on FOX news or CNN for that matter.
Maybe I am naive. Don’t take this as a political statement, I rarely every go there as you all know.
Here is the article, the whole article, sorry but it is definetly worth the read.
“They see speculation in the market, I see decline in global inventories. I don’t think this is a big surprise, that we’ve had a jump in price when there has been a decrease in crude inventories.”— Energy Secretary Sam Bodman, Bloomberg News, Mar. 5, 2008
“It should be obvious to you all that the [gasoline] demand is outstripping supply, which causes prices to go up.” — President George W. Bush, Associated Press, Mar. 5, 2008
One wonders if verifiable facts ever get in the way of this administration’s statements on issues that are critical to the average American’s well being. After all, last time I checked, when politicians are elected to public office, or appointed, as is Energy Secretary Samuel W. Bodman, they must take an oath to the American people before assuming their new positions. How can they forget a sacred oath so quickly? Were they daydreaming when they took it, so it never meant anything to begin with? Maybe it’s just another promise you have to make to get into office: When you’re securely incumbent you can ignore even solemn oaths you took.
Obviously, the two quotes that led this article came from discussions concerning the current high price for oil on the futures market. Bodman appears to be protecting the speculators in oil, as opposed to looking after the interests of all Americans. President Bush, apparently, has never talked to the Energy Dept.’s Energy Information Agency to see whether gasoline demand is actually up. More troubling, the writer of that particular Associated Press article obviously didn’t look up the EIA’s numbers to verify the President’s assertions.
They weren’t accurate.
1. There Is No Shortage
Gasoline reserves on hand are at the highest levels since the early 1990s, which is remarkable considering the nation’s refineries have been cutting back on the production of gasoline because their margins have declined. In fact, average gasoline reserves on hand have risen since this past October, while oil reserves in this country have gone up virtually every week this year—and only fog in the Houston Ship Channel that kept oil tankers from unloading their crude one week kept it from being every week. In the same Bloomberg article that quotes from Bodman’s CNBC appearance on Mar. 4, he also said that it was thanks to ethanol that the gasoline problem isn’t even worse. He then added that the fact that making ethanol is forcing up prices of other farm commodities, including hog and chicken feed, is “nowhere near as important as trying to relieve pressure on [gasoline] supplies.” Of course, there is no pressure on gasoline supplies in this country as of today, but Bodman’s statement must have made eyes roll among the executives at Pilgrim’s Pride PPC; the Pittsburg, (Tex.) poultry producer announced 1,100 layoffs on Mar. 13, closing one processing plant and 6 of their 13 distribution centers because their company’s outlay for chicken feed went up $600 million last fiscal year and was on track to increase by another $700 million this year. Here’s the scorecard, in case you missed it. There’s no shortage of gasoline or oil in the U.S. today, and we have near-record reserves on hand. Meanwhile the Congressional mandate for ethanol has jacked up the price of chicken feed for Pilgrim’s Pride, which is the U.S.’s largest processor of chickens and turkeys—by $1.3 billion. And that’s for just one company processing chicken. This is what passes for acceptable to our Energy Secretary?
2. Demand Is DOWN, Yet Prices Are UP
Just so we can all get on the same page, here are the verifiable facts on oil supplies, production, and gasoline demand. In January of this year, the U.S. used 4% less petroleum than we did a year ago. (Oil demand was down 3.2% in February.) Furthermore, demand has been falling slowly since July of last year. Ronald Bailey of Reason Online has pointed out that worldwide production of oil has risen 2.5% in the first quarter, while worldwide demand has grown by only 2%. Production is expected to increase by 3.3% in the second quarter, and by as much as 4.1% by the third quarter. The net result is that the U.S. daily buffer for oil production against demand, which was a paltry 1.5 million barrels as recently as 2005, is now up to 3 million barrels in excess capacity today. So what is going on here? Why would our Energy Secretary say there’s a supply and demand problem when none exists? Why would he say that speculators have little or nothing to do with the incredibly high price of oil and gasoline, when it’s clear they do? President Bush—a former oilman—gives the ever-growing demand for gasoline as the primary reason prices are so high, yet that notion can be dispelled with one minute of research. That’s the problem with rhetoric; it rarely matches the facts.
3. Speculation is Up, and the Dollar Is Down
On the same day the President and our Energy Secretary made those foolish comments, no less an authority than ExxonMobil (XOM) Chief Executive Officer Rex Tillerson was quoted by Marketwatch as saying, “The record run in oil prices is related more to speculation and a weakening dollar than supply and demand in the market.” He added, “In terms of fundamentals, fear of supply reliability is overblown.” As for the speculators, in 2000 approximately $9 billion was invested in oil futures, while today that number has gone up to $250 billion. Now, if any publicly traded company had an additional $241 billion put into its stock in the same period, its stock would rise out of sight too—even if the company was not worth anywhere near that amount of market capitalization. Moving on to the weak U.S. dollar as a primary cause for skyrocketing oil prices—there is “some” truth in that statement. But consider this: The dollar has depreciated 30% against the world’s currencies since 2002, while the price of oil has gone up 500%. So is it the weak dollar that has caused a 500% increase in the price of oil, or is it the extra $241 billion worth of speculation? You can make the call on that one. Possibly just to ensure oil prices don’t respond to real-world market conditions, Goldman Sachs (GS) forecast on Mar. 7 that turbulence in the oil market could cause oil to spike as high as $200 a barrel. This flies in the face of all known information—but then again, Goldman Sachs is the world’s biggest trader of energy derivatives, and its Goldman Sachs Commodities Index is a widely watched barometer of energy and commodities prices.
What Is Washington Thinking?
Rounding out the list of experts discussing our oil and gasoline situation is Bill Klesse, head of San Antonio (Tex.) Valero Energy (VLO). He spoke in San Diego a week after those comments from Goldman Sachs, the President, and Secretary Bodman. Believe it or not, Klesse said poor margins may cause Valero to sell one-third of its refinery operations; he stated that poor margins in recent months had caused planned refinery expansions—which would have produced 500,000 more barrels per day—to be canceled. Moreover, according to a report from Reuters on Mar. 11, 2008, Klesse recently released the information that gasoline production has been curtailed in response to slowing demand. Imagine that: Refiners cut gasoline production, yet gasoline reserves have grown to their largest since late 1992. So much for “surging demand.” Klesse also called for the government to start imposing a tariff on imported gasoline to protect U.S. refiners’ profits. Protectionism? As famed economist John Kenneth Galbraith correctly said, “In America, the only respectable form of socialism is socialism for the rich.” Which takes us back to the original question: Why is Washington doing everything it can to convince us there is a shortage when there isn’t one? After all, the only people they’re protecting are those heavily invested in oil futures—and that’s to the detriment of all other Americans.
We’re Paying for What?
When it became undeniable that poor decision-making by company executives had put a respected 85-year-old U.S. institution in financial peril, why did the Federal Reserve rush in to save investment bank Bear Stearns (BSC)? Of course, we need to restore confidence in our financial institutions, but why protect the personal assets of those who were responsible for the mess? Both the corporation’s officers and its board members should contribute their personal assets toward saving the bank they put in the ditch—the bank all of us are going to pay to bail out. Instead, the Bush administration is protecting those responsible for creating yet another speculative bubble in oil futures, and is protecting investors in the ethanol industry—much to the detriment of food-processing companies such as Pilgrim’s Pride. And the net result of all this is that the prices of crude and gasoline rise ever higher thanks to a “shortage” that does not exist, while food costs are soaring thanks in part to the ethanol mandate. The Federal Reserve lowers interest rates, but the cost of mortgages goes up six weeks in a row—and last month Bank of America (BAC) credit-card holders started being charged more than 24% interest on new purchases. This is what they call “Republican Prosperity?” Ronald Reagan was both right and wrong when he said, “Government is not the solution, government is the problem.” And government is still the problem. Instead of a fair and open market they gave us a free-for-all marketplace with no regulations at all, which lately these “bubble boys” have sent south for all of us. One would guess that Washington missed the obvious: Protect all U.S. consumers and you’re also protecting business expansion.
Ed Wallace holds a Gerald R. Loeb Award for business journalism, bestowed by the Anderson School of Business at UCLA. His column heads the Sunday Drive section of the Fort Worth Star-Telegram, and he is a member of the American Historical Society. The automotive expert for KDFW Fox 4 in Dallas, Wallace hosts the top-rated talk show Wheels, Saturdays from 8 a.m. to 1 p.m. on 570 KLIF AM in Dallas.
Hope you found this informative.
Mark Clawson at Las Vegas Undressed
April 9th, 2008
Posted by Mark Clawson
As most of you know I really enjoy posting on this site. Sometimes I can’t do it as frequently as I would like. Part of the pleasure comes from meeting with you individually or in the space called the internet.
Mike Malandra is one of those people and we made contact due to his interest in the Southwest and his desire to move the Mount Charleston area outside of Las Vegas.
I find that Mike is a photographer and with his permission he has allowed me to share a few of his photos and thoughts on nature.
Michaels Mission Statement:
As I get older I find myself turning to nature for my personal and spiritual growth. My relationship with the natural world is becoming a greater part of my everyday life. I find myself drawn to places of mystery where I can feel at peace with the power of the earth’s spirit.
Over the years I have learned to use my photography and painting to express my passion for nature. It is my mission to communicate the mysterious connection I feel when photographing and painting nature’s creations. I hope viewing my work gives you the same emotional response I feel when creating it.
Through my art work you will see the beauty of our world. As you view each photograph, I strive to show you this world through my eyes. Enjoy the photos, but I challenge you to do more. I challenge you to go out and experience the wonders of nature for yourself. You will find it is worth protecting, and it is worth preserving!
I have read Gary Zukav’s “Seat of the Soul” and I thought that this quote was quite appropriate based on what Michael has said.
“Our species has become arrogant. We behave as though the Earth were ours to do with as we please. We pollute its land, oceans and atmosphere to satisfy our needs without thinking of the needs of the other life forms that live upon the Earth, or the needs of the Earth. We believe that we are conscious and the Universe is not. We think and act as though our existence as living forces in the Universe will end with this lifetime, and that we are responsible neither to others nor to the Universe.”
Just something to think about, hope you enjoyed Mike’s photos!
April 8th, 2008
Posted by Mark Clawson
The Fed is at it again and making no sense. Politics doesn’t mix with common sense and the Feds latest proposal makes little if any sense. The Fed is trying to put forth new regulations that will require Mortgage Brokers only NOT LENDERS to disclose, before application, what the mortgage brokerage fee and rate on your loan will be. This fee and or rate cannot change under the proposed changes to Reg Z, commonly known as the Truth in Lending disclosure.
As you may know Collen McGrath and myself work for a Mortgage Broker in Las Vegas and in the State of Washington.
Below you will find our individual comments regarding this proposed change:
Comments by Mark Clawson:
Dear Sir or Madam,
I find it incredulous that you have chosen to allow lenders to continue to non-disclose their fees. Isn’t non-disclosure, on the part of lenders, what has caused this mortgage mess that we know have on our hands. Did the lenders disclose how they were packaging their collaterilized debt obligations? Why place your confidence in the lenders and not the many mortgage brokers who chose not to provide loans to unquailifed borrowers?
In many cases, loan officers working for mortgage brokers, actually helped to avoid an even worse mortgage crisis.
The proposed re-vamp of Reg Z where the broker is required to provide the consumer with a “precise” dollar estimate of fees the broker will charge is not well thought out. How can you know the borrowers situation without taking a loan application.
It is through the “precise” accumulation of client data that you are then able to provide the client with a “precise” estimate of fees. I understand the intent but let’s get real. You can’t provide good information to the client without good input from the client. Shouldn’t lessons of the past guide how we approach the future in dealing with the client?
Let’s not let politics dictate changes. What ever happened to common sense?
Comments from Colleen Jane McGrath:
Dear Sir or Madam,
I am writing to express my comments on the proposed Reg Z changes now currently being considered. As a preface, you should know that I was in the business when Reg Z first became a law many years ago (at the urging of Senator Proxmire if my memory serves me well). I tell you this so you have some indication of the years of experience I have in the mortgage industry.
For my first twenty six years in the mortgage business, I worked as a mortgage banker for various companies, primarily bank owned. As an originator I was encouraged to get “overages” to increase my income as well as that of the bank. However, when I became a broker, I was able to use yield spread premiums to offset buyers costs, AND I was able to offer my customer a better rate that he could obtain from a bank.
The differentiation between lenders and brokers has become blurred over the years because, unlike in the past, lenders now package and sell their loans and most often times do not retain the servicing. When the loan is originated by the lender they know in advance what investor they are delivering the loan to for purchase. In essense acting as a broker.
However, lenders, unlike brokers ARE NOT REQUIRED TO DISCLOSE their total compensation. Why is that? How can the consumer be fully served if full disclosure is not required by both lenders and brokers alike? Moreover, how does the consumer know that he is indeed doing business with a lender versus a broker?
There have been several studies which show, on an overall average, that the consumer fares better when dealing with a broker versus lender. Are these studies not being taken into consideration when debating the matter at hand?
The most egregious part of the proposed re-vamp of Reg Z is the requirement for the broker to provide the consumer with a “precise” dollar estimate of fees the broker will charge, especially in light of all of the recent changes in the Secondary Market. It is impossible to provide the consumer with a precise estimate when so many factors can impact the pricing such as:
Credit Scores
Loan to Value
The Income and Financial Statement of the consumer/borrower themselves as it relates to program, fees and rates they will be eligble for when making application.
In essence, the very items needed to make a determination on how best to help the consumer cannot be obtained in advance under the proposed changes. In a time when consumers need more avenues for financing, these proposed changes will constrict those avenues in essence hurting the consumer even more.
There must be other ways for the Federal Reserve to protect consumers in their dealings will ALL mortgage originators, Lender or Broker, and encourage competition that is based on price and service. What can I do to help you pursue these other venues?
I thank you for taking the time to read my comments and would welcome any questions you might have regarding my suggestions.
April 3rd, 2008
Posted by Mark Clawson
The Iris is blooming in Las Vegas. Actually in Colleen’s garden.
April 2nd, 2008
Posted by Mark Clawson
Thursday Night at the Springs Preserve will be a time to enjoy a concert and food at the Springs Preserve Café by Wolfgang Puck. This after-hours event will feature seasonal appetizers, signature drinks and live music. Every Thursday night from 6 p.m. to 9 p. m. you will be able to enjoy a “new Friday”.
• Artichokes & Arias in April
• Mozart & Mojitos in May
• Jazz & Juleps in June
The Springs Preserve Café by Wolfgang Puck is a wonderful venue with indoor and outdoor dining. The wraparound balcony provides a great view of the Preserve.
The Café is one Wolfgang Puck’s Gourmet Express eateries. Puck uses local farmers and growers. Wolfgang’s Eating, Loving and Living program assures the use of ”fresh, quality produce, including beef, chicken and fish raised in good conscience with minimal hormones, pesticides or antibiotics.”
After relaxing to the live music and having a few appetizers you are welcome to stroll through the Preserve’s gardens or trails at no additional expense. The rest of the facility will be open, however, an admission will be charged.
March 31st, 2008
Posted by Mark Clawson
I’m a Seattle native with a definite bias for the home team. The Cubbies won 4-2 and it really doesn’t mean much, the Mariners are beating the Texas Rangers 5-2 in the top of the 9th as I write this post.
Now a final score in the Mariners home opener!
It was just great to get out to the ballpark and get that feeling that comes with the opening of the baseball season. There was a wonderful woman who sat in front of my friends and I with a young son, maybe two, he will surely become a great baseball fan. The smell of hotdogs was there but to be honest the service at the stadium was not that great. Slim and none were the chances of getting a dog in a timely manner. But, a wonderful day was had by all and the Cubs won which pleased most of the fans in attendance.
The Stevens Baseball Group bought the 25-year-old franchise from Mandalay Baseball Properties in a deal approved last week and will now direct the future of the franchise. There has been talk about a new name to be selected by the community of Las Vegas. The current name came in 2000 when the name went from the Stars to the 51s. Maybe it is time to lose the Area 51 connection.
There have been changes including the new left field party deck and the new scoreboard.
The Dodgers will surely ask for more since their lease expires after this year. There is some talk of a domed stadium emerging with community support. Just a cover of sorts would be nice, this is a good venue and a dome sounds extreme. How about some cover and misters? They have misters in Arizona but they are sorely missing in Las Vegas.
Love going to these games. My friend is vocal “Heh batter…..Heh Batter” this is what baseball is about. Enjoy the season my friends.
Mark
March 23rd, 2008
Posted by Mark Clawson
A new Casino and Resort Hotel is rising from the desert on The Strip. The Fontainebleau Hotel is coming to Las Vegas.
The Fontainebleau Miami Beach opened its doors in 1954 and was considered a “monument to modern design and architecture”. Designed by Morris Lapidus the Hotel Resort attracted the likes of Elvis, Frank Sinatra and the Rat Pack. Not surprising that they are developing a Las Vegas version right on the Strip in Las Vegas. The resort in Miami has seen a billion dollar face lift and now we can see the image grow in Las Vegas. Below is a picture of the Fontainebleau Miami Beach.
Here are some othe photos of the construction site on The Strip.
There will be a transformation on the northern end of The Strip that is sorely needed. After the Fontainebleau is completed in late 2009 or early 2010 the next project is the Las Vegas Tower which will be 102 stories. This will truly energize the area. Currently the Sahara, Riviera and Circus Circus occupy the area surrounding these new developments and we will truly have a new venue for style and architectural design that will enhance the experience and flavor of The Strip.
Here is an artist renditon of the Fontainebleau Las Vegas at night.
I have to admit that I have a soft spot for the Sahara. Back in the 60’s a few of my friends and I ventured to Vegas. We were young, perhaps 20, and ended up catching a show with a comedian named Don Rickels. This was not a stage show but a bar show. I won’t get into the details; this was at the start of his career and we still talk about the night at the Sahara.
March 22nd, 2008
Posted by Mark Clawson
Great Place to Live and Love.
March 18th, 2008
Posted by Mark Clawson
I must admit that the mortgage market is getting very crazy and unpredictable. So do we need to be celebrating with a glass of wine and a nice dinner? You can be the judge.
Two weeks ago the thirty year fixed rate mortgage had a note rate of 5.875% and today it is 5.5%. This is good. However, the 3 Year Adjustable Rate Mortgage has gone from a note rate of 4% to 5.625%. This is not good. You can view all of todays conforming rates by clicking here.
My thinking is not nessarily supported in fact, however, I will give you my best read. Long term mortgage rates are pegged, somewhat, to long term Treasury Notes or Bonds. Short term rates don’t have such a mechanism at work. Bankers are having a hard time finding Wall Street investors for their ARM products and with little demand the rates are moving upward. I believe there is concern about home values in the short term. Prices are falling and there is concern about the borrower losing equity in their home. Without a pricing mechanism in place fear is coming into play.
For now, ARM Products for mortgage loans don’t look very appealing. The rates are higher than fixed rate mortgages.
