Author Archives: Jon Lowder

Winston-Salem in the Movies

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The New York Times has a very favorable review of Goodbye Solo, an indepedent film that is set in Winston-Salem.  If you take a look at the review on the Times' site you can also view a trailer for the movie.  I did and now I'm thinking I'd really like to go see it at the upcoming RiverRun International Film Festival being held in Winston-Salem from April 22-29, 2009. Goodbye Solo's screening is scheduled for April 25 at 4:00 p.m.

Mia, Mia, Mia

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This morning I received the following email from my lovely wife Celeste.  It was sent after she'd already dealt with an outrageous billing issue with our former insurance company and had left our dog Mia to her own devices for two hours this morning.  Luckily Mia was confined to the family room, sun room and kitchen or who knows what she might have done. Here's the text of the email:

Subject: Mia. Mia. Mia.
 
On top of the Blue Cross thing now there's the Mia thing. Or should I say THINGS?
 
1. Pee on the kitchen floor.
2. Notebook paper chewed up like a shredder on the family room floor.
3. An entire bag of tortilla strips in a pile in the sunroom (a rather neat and tidy pile by the way).
4. My knitting. Oh yes this is wonderful. The once neatly wound ball of yarn is now a bird's nest.
5. Did I mention that my knitting needles are now toothpicks and splinters?
6. Who knew a baseball was made of so many little white strings?
7. She obviously doesn't like the taste of the English muffins because they made it from the butcher block in the kitchen to the back door of the sunroom unscathed.
8. Erin's celestial orb (the pretty silver thing with colorful beads that can be made into various shapes) is not in working order any more.
9. And the crowning glory? A big pile of poop.

Celeste


I dare not laugh lest I be forced to live the rest of my life sans one limb or another.

Layoffs = No Insurance or Crappy Insurance

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News that should surprise no one: North Carolina has the fastest growing population of people without health insurance.  Since North Carolina is also a leader in lost jobs this isn't exactly shocking news.  The report referenced in the story contains an estimate of 1.75 million people in the state who don't have health insurance.  The US Census shows North Carolina's population in 2007 as 9,061,032 so that means that the percentage of people in North Carolina without health insurance is roughly 19%.  

As scary a number as 19% is, I'm wondering how many of the other 81% are under-insured?  I can tell you from first hand experience that it's very expensive to buy insurance that offers decent coverage and I suspect that there are plenty of people who have purchased what can only be termed "crappy" insurance in order to keep their premiums affordable.  Having purchased some crappy insurance myself in an effort to battle premiums that jumped 30% one year I can tell you what the results were:
  • Our insurer basically disputed every claim.
  • Our riders that were supposed to provide a certain number of office visits at no additional cost basically did nothing.  We still ended up paying out of pocket. 
  • Our coverage was almost impossible to understand which means we started avoiding the doctor for fear that it would cost us $120 to find out one of us had a simple soar throat. 
  • Luckily we didn't experience any major illnesses, but if we'd kept that coverage I think we might have ended up with undiagnosed illnesses because we tried to avoid the doctor.  

Basically we started to view our insurance as "armageddon coverage", only to be used in case of a catastrophe and I'm not entirely confident it would have covered us even in those circumstances.  My point is that if even 10% of the 81% of insured North Carolinians has similar coverage then we're probably looking at close to 700,000 people that could be living with easily treatable illnesses that could grow into major health crises because they're afraid to see the doctor and who might not then be covered adequately when they end up in the hospital.  Add that to the 1.75 million people without any insurance and you have a really frightening number of people at risk for financial devastation if they get sick.

More Pie-Eyed Optimism

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A couple of days ago I wrote about my hope that due to a decrease in foreclosure rates here in North Carolina we are actually a leading indicator that the nation's economy has hit bottom.  My friend Dan called me a pie-eyed optimist as a result.  I did temper my post with the news that home sales in Greensboro were down 38% in February from same month sales the year before, so I wasn't real shocked when I read today that Winston-Salem's home sales in February were down 30% from the year before.  Average home prices were also down, but given the number of foreclosures on the market that's not exactly a shock either.

So, am I still standing with my pie-eyed optimism?  Why yes I am.  My hope is that:
  • Foreclosures have peaked 
  • Our glutted housing inventory will start to clear 
  • House prices will stabilize (normalize)   
  • By some miracle the government's plan for the banks works (longest shot of all) and even if it doesn't that the "free markets" actually work the way they're supposed to and that we get through the painful period sooner rather than later.  
  • By some miracle the financial industry learns its lesson and starts acting like, well, like what we used to think bankers acted like. 
  • Americans continue with their newly-found frugality, but at the same time begin to emerge from their monastic existence of the last six months and begin to buy things within reason (and their budgets).
  • American companies begin hiring people once their businesses have stabilized and that the companies subsequently treat their employees well and perhaps think about spending a little less on executive "talent" and a little more on employee and customer satisfaction.
  • By some miracle I can retire before the age of 97 and live in a society where my grandchildren at least have the same standard of living that their great-grandparents and grandparents enjoyed.  Asking for them to have a better standard might be a bit much at this point.

Wilbur Replacing Weather at WXII

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Did you know that WXII has a 24 hour weather channel?  If you did I guess you didn't have much company because WXII has decided to replace their weather programming on the channel with 24 hours of really old TV shows like Mr. Ed and movies that you've probably never heard of.  From the story:

Starting June 1, WXII will be replacing its Weather Plus sub-channel with This TV, a free movie and classic television channel offered by Metro-Goldwyn-Mayer, the station announced Monday…

This TV programming includes 4,000 film and 10,000 television series episodes in agreement with six distinct studio libraries: Cannon, United Artists, Polygram Filmed Entertainment, Orion, Samuel Goldwyn Films and MGM.

Classic television shows such as Patty Duke and Mr. Ed, as well as feature-length movies, will be offered 24 hours per day.

Goodbye Lanie Pope, hello Donna Reed.

Bonus points to anyone who can tell me who the "Wilbur" refers to in the title of this post.

Foreclosures from the Feed Reader

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One of the Google Alerts I have set up is "forsyth county nc" and it regularly sends some interesting items to my Google Reader.  For instance I get lots of links from a site called bankforeclosuressale.com that include the addresses of houses listed in their database as being in foreclosure. Here's this morning's sampling:

You'll notice when you visit the different pages that the addresses don't show up on the pages unless you register for the site.  I don't want to register for the site so luckily for me the addresses show up in the feed so I don't have to.  The glum part of this is that these are houses that people have lost, but on the brighter side I'm seeing fewer of these in my reader these days than I was a while back.  Hopefully that's a trend that will continue.

Friends in the Right Places

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Apparently insider lending is common practice at banks, with banks regularly giving loans to executives and directors.  Okay, it's not really a shock that muckety-mucks in banks would have special access but when you read this article in the Charlotte Observer it becomes apparent that the insider dealing went to pretty high extremes at North Carolina's own Bank of America and Wachovia.

Charlotte's two big banking names are among the biggest insider lenders.

At Bank of America, those loans more than doubled last year, to $624 million – the biggest dollar jump in the country. The largest of them likely went to three directors or their companies. The surge came during the third quarter as credit markets froze, the government prepared to infuse banks with billions in tax dollars and the board approved the purchase of troubled Merrill Lynch.

Wachovia ended 2008 with $747 million of insider loans, second only to the much larger JPMorgan. All of the loans were held by Wachovia directors or their companies, with just five holding the largest. Last year, the company had to sell itself amid staggering losses in part due to a 2006 deal.

According to the article the lending at BofA really accelerated in 2008 at a time when the credit markets crashed and when the bank was the recipient of a rather large government bailout.  I'm thinking that the bank's directors were VERY happy to have their seats last year.

The article also points out that the loans are highly regulated, that the terms of the loans must be identical to those available to non-insiders and that mega-banks like BofA have government regulators on site.  That's all well and good, but I'd imagine that an insider would have a very big advantage in actually getting a loan compared to someone coming in off the street and that's exactly the kind of perception that's causing the financial industry to have a public image worse than ambulance chasing lawyers or even politicians. 

Of course we wouldn't be paying too much attention to the bonuses if the banks were doing well, but since they're struggling the insider deals look even worse.  The most recent issue of Fortune has a grim article titled "Will the banks survive?" that points out that on February 20 BofA stocks were trading at less than $3 per share and Citigroup's at less than $2 per share which means their combined market cap was less than Kraft foods.  Oh, and it points out that the trouble has just begun for the banks:

How can it be that the banks are tottering after the government fortified them with hundreds of billions in bailout cash and guarantees on their troubled assets? For the past 18 months, the banks' problems with toxic securities, especially collateralized debt obligations (CDOs) and other exotic products that packaged subprime mortgages, attracted most of the attention – and alarm. Now the storm is entering an entirely new phase that's potentially even more dangerous: a historic meltdown in the bread-and-butter businesses of credit card, home-equity, and mortgage lending.

The scale of potential losses in consumer and business loans swamps what's left from the securities debacle by a factor of three or four to one. And the next wave, the looming defaults on commercial real estate loans financing the likes of half-leased retail malls, will soon cause a fresh round of pain. "We've now moved from the securities phase to the lending phase of the banking crisis," says Tanya Azarchs, a managing director in S&P's financial services ratings group. "For 2009 we expect that loan losses will be much worse than for 2008 and that securities write-downs will be much less."

Ouch.