The Pink (?) Returns!

If you haven't already, read my hilarious, surreal prior post - Great Neck's Pink Pants!

So who's the new pink-o-phile?

Well, I espied Sven in downtown Southampton, NY this weekend.

The freakin' guy had (to go with his vertebrae-displacing side-part) the words "Hello Kitty" painted on the pink bike!

And don't think for a second he just borrowed his sister's bike to ride into town to grab a mineral water or a vegan smoothie.

NO. He was with one of his buddies - a guy who also was riding a very similar *pretty* bike. By that and the manner of their sidewalk flouncing, it was clear that these HJs were riding their very own, beautified vehicles!

So the guy(?) goes past me for the first time and right past my wife up the street. Mrs. C-Nut comes running back, "Did you see that @sshole?...Get your camera out!"

If you recall from that prior post, she wasn't exactly on my side when I was snapping pics of that deranged goofball wearing pink pants.

You see, when she's sober, it's clear how RIGHT I am!

The camera was already out...

And, as I photo stalked him up the sidewalk, we both enjoyed a big deja vu laugh.

My bad, I really should have *engaged* the dude. I'm actually a very good on-the-spot interviewer.  It's just that, I guess, I was still shell-shocked from that cop harassing me last time.

The Alien Smore Tax

Recall we spent last week in the Hamptons. My kids wanted to have a campfire and do smores...

Already in possession of those new, huge, *toasting-size* marshmallows, I go to the local supermarket out there and buy a 6-pack of Hersey's bars, a box of Graham Crackers, and a bag of lemons (for lemonade).

What did each item cost? Well, I'm on *holiday* so it doesn't matter. What, am I going to tell the kids that we can't do smores because the ingredients are too expensive?

I ring it up at the self-checkout and the bill for these mere three items comes to $13.54.

What? I faintly recalled seeing *two prices* under the chocolate bars; and tiered pricing on the Graham Crackers as well. I guess they weren't on sale explicitly.

"Do I have to have one of those cards?", I hollered over to the clerk nearby. She responded in the affirmative and quietly swiped her Waldbaum's card through - but only because I sought her out and asked.

The bill dropped all the way to $9.00!

So there you have it....a 50% extra smore's tax on out-of-towners or anyone else thoughtless enough to not beg a cashier to swipe their card.

In the cutthroat, low-margin grocery business that's some serious *manufactured* profit.

At most stores the clerks will reflexively swipe their card for anyone without one. But there are a few out there (e.g. Harris Teeter down south) where it seems like a matter of policy to....to tax unsuspecting and/or forgetful Morons.

Always Moving Around

I am out in the Hamptons for at least the next 5 days. There is computer access here but I have to share it with people who have lower PageRanks!

I've brought myself a couple of books - The First Man by Albert Camus and The Big Short by Michael Lewis.

The former came from my MIL's huge library of classics. She's been after me to read Camus (pronounced "Cam-ooo") for some time. The book I grabbed (and have almost killed already!) was published posthumously and is largely autobiographical. I'm in! I think he's a tremendously articulate and thoughtful guy. So which of his books should I read next? Any suggestions?

'Out East" Heading South

Here's a summary of the 2nd Quarter 2009 Hamptons real estate market that I just gleaned from from some pamphlet:

A look at all HAMPTON MARKETS COMBINED and we see the glacial shift. The number of home sales dove 58% from 416 in 2008 to 175 in 2009 (it was 622 in 2007), while the Total Home Sales Volume fell 61.5% from $747M in 2008 to $288M in 2009 (BTW it was $1.25B in 2007).

I'll do the math for y'all:

Total sales this past quarter were down a whopping 77% from Q2 2007!

Nonetheless, note the cheerleaders are back out in full force because of 3rd quarter euphoria/delusion. See - Some Real Estate Agents in Hamptons See Rally.

Methinks Meknows, there's still a LONG way to go. These rich a$$holes ALL, ALREADY own a ton of real estate. Seriously, have you ever met one who didn't?

The market rental prices of these homes remain mere fractions of the cost of ownership - and the bottom won't be hit, at least, until these numbers collide.

Sunsets

I captured that sunset leaving Sag Harbor Sunday night.

This evening I drove by that spot again, only it was overcast, and we were rushing to make the Orient Point ferry. Our trip to Southampton got shortened by a couple of days by the passing of my dear grandmother. She was in her ninth decade and had lived the fullest of lives when her time came.

As her most favoritest of all the grandkids, great grandkids, and great-great grandkid (only 1) I volunteered, and was quickly drafted, to deliver the eulogy. So obviously I'll be busy for the next couple of days.

At age 34, in my ethnicity, it was getting pretty darn incredible to still have had three living grandparents. So I've been more than blessed in that regard. Heck, this will only be the fourth funeral of my sheltered life.

Every Town Is Bankrupt

East Hampton Reels as Billionaire Town Floats Debt

The Long Island sanctuary for the rich, where lobster salad sells for $85 a pound, has been hit by a double whammy: a tripling in workers' health costs since 2003, which officials failed to anticipate, and a 43 percent drop in revenue from mortgage taxes related to real estate sales in the first half of the year from 2007. Town officials for the first time plan to reduce the deficit by borrowing, after winning state approval for a $15 million bond sale.

East Hampton is self-insured to cover health care for its 448 employees and retirees. Costs associated with the plan increased to $9.2 million this year from $2.9 million in 2003, according to the official statement for bond anticipation notes sold in June, one-year securities that helped finance capital projects and improvements.

The town intends in the next several weeks to borrow $4 million dollars or more with a revenue anticipation note, as it awaits receipt of mortgage taxes already collected by Suffolk County, said board member Pat Mansir.

"It still hasn't been determined exactly how much we might need," Mansir said.

As of July 22, the town's general fund contained only $900, she said. The town received enough revenue in fees during the next four days to meet its more than $1 million bi-weekly payroll, she said.

East Hampton also plans to sell a $10 million, one-year bond anticipation note in August, and then convert the note into a $10 million, 10-year bond issue that may cover some capital spending requirements along with deficit reduction, said board member Peter Hammerle in an interview.

The board will probably use the remaining $5 million of its borrowing authority by issuing a second 10-year bond issue next year to cover a deficit officials expect in 2009, he said.

"We still don't know how much our medical bills will total," Hammerle said.

'Bite the Bullet'

A $10 million issue over 10 years would require a 4 percent increase of East Hampton's property-tax rate, said Town Supervisor William McGintee, a Democrat.

"Once you go down that road you're raising taxes just to pay interest," he said. "I would rather see us bite the bullet now."



So how do healthcare costs triple in five years?

Sure premiums are rising, but not quite nearly that much.

The answer is probably in "retirees". East Hampton probably not only added to its *benefit payroll* because of retiring workers, these 'old coots' benefits probably cost a whole lot more.

The fact is, almost every town in America is paying the indefinite healthcare benefits of its retired municipal workers. It's a liability that they can scarcely afford no matter how much money they set aside for it. Cities and towns have been hit with the "triple whammy" of rapidly rising healthcare costs, longer life expectancy, AND shrinking confiscatory revenue. Innumerable towns will be forced to declare municipal bankruptcy just so they can *renegotiate* benefits with their retired cops, firemen, librarians, and janitors.

It needs to be said that these local governments had no business promising lifetime benefits to their employees in the first place. They had no business promising something they couldn't guarantee.

On a larger level, the States are all pushing for a bigger role for Medicare. They are trying to offload their healthcare liabilities to the Federal government.

In fact, the parallels between Medicare and Fannie Mae are striking.

Just as the blind Medicare expenditures have helped push healthcare costs to the stratosphere - Fannie Mae's movement into holding and (implicitly) guaranteeing mortgages also forced traditional mortgage lenders to lower their standards to compete - sending home prices to the moon.

Medicare helped bankrupt the municipalities and then they turn around and push for a larger State hand in medicine...so they don't have to make any tough budgetary decisions themselves. Then the States knock on Washington's door...

Likewise, after Fannie Mae drove rates and credit concerns to the floor, taking the mortgage banks down a sewer, now Bank of America Corp, Wells Fargo, Citigroup, JP Morgan Chase, and cohorts are offloading their bad mortgages onto the Feds via Fannie Mae and FHA. More accurately, they are offloading their junk onto taxpayers and future generations.

Big Government has grossly distorted the markets for both housing and healthcare. Sure, other options exist for consumers, but both Medicare and Fannie Mae have defined and inflated both cost structures and set standards industrywide. I am not positive, but I believe the term describing this type of *imperfect competition* is monopsony (surely some nerd will try to correct me).

East Hampton's fiscal woes are the perfect launch pad. From this one bankrupt municipality we can easily extrapolate to almost every other town in America.

If you knew anything about East Hampton you'd know that there has been new construction (read: new tax revenue) left and right for the past several years. None of these homes are under a $1 million either, with many multiples of that. Furthermore, on the East End there are scarcely delinquent taxpayers nor has there really been anything other than a recent, slight downtick in the NYC economy. So if a town flush with cash flow can't cover its bills what does this forebode for Camden, NJ or Pontiac, Michigan? For the State of California? This is my Greg Mankiw induction argument once again.

Politicians the world over simply spend every nickel that comes in and then go into hock for quarters and sawbucks.

East Hampton may be running short today, but it was just yesterday they were spending millions moving and restoring barns to *maintain the towns character* and, of course, to house municipal employees in the lavish manner they *deserve*. They've also got a confiscatory 2% transfer tax on all real estate transaction in the Hamptons called the Peconic Bay Community Preservation Fund. Surprisingly, there's not much written on the web on that slush fund. Two-percent is big money when you are talking about the multi-million dollar mansions and estates out East. It is just another example of a minority (those already domiciled in the Hamptons) voting themselves the assets of a majority (anyone who would in the future buy a house out there). I guess if you want to be part of the *scene* you have to ante up!



There's a running joke or catch-phrase in the doom-and-gloom housing bubble blogosphere that, "We're all subprime now." Like all provocative humor, its foundation is the naked truth. This line from the article above...

The town intends in the next several weeks to borrow $4 million dollars or more with a revenue anticipation note, as it awaits receipt of mortgage taxes already collected by Suffolk County, said board member Pat Mansir.

...certainly buffets that jest. Read up on RAL Loans on Wikipedia. These products for the *working poor*, are exploitive, allegedly racist, and got HR Block and Jackson Hewitt in all sorts of trouble.

The companies defended themselves by arguing that refund anticipation loans are legitimate and for *emergencies*.

If we aren't "all subprime", the differences at least seem very blurry these days.

By the way, if East Hampton is spending $9.2 million this year to cover the healthcare of its 443 employees and retiree...

...then it is spending a whopping average of $20,536 per person!!!

Illegal Immigrants Never Were The Linchpin Of Our Economy

"Although they broke the law by illegally crossing our borders," Bloomberg said, "our city's economy would be a shell of itself had they not, and it would collapse if they were deported. The same holds true for the nation."

That was NYC Mayor Michael Bloomberg from back in June 2006.

That quote of his typifies the mindset of Wall Street Journal, Forbes, and other business-minded (rational?) influence peddlers.

Though not for all of its proponents, that was a self-centered, myopic viewpoint. The economy was running rampant two years ago; contractors simply couldn't be found to fix up your house. Ergo, we desperately NEED illegals!

Of course now things are different. Unemployment is creeping up towards 6% and the construction industry (read: unskilled labor market) is in shambles. Here's a more up-to-date anecdote:

"Agustin Garduno, wearing a paint-stained sweatshirt, said he sleeps in cars and on floors at friends' houses because he can't afford rent. As noon approaches and no contractors have pulled up to the corner of Van Nuys Boulevard and Oxnard Street looking to hire, it will be the fifteenth day he has gone without work. "If you gave me a ticket, I'll go back to Mexico because here, there's nothing," said Garduno, 48, who used to make $1,300 a month and now makes about $500."



Historically, whenever economies have weakened, xenophobic resentment has always reared its head. With our financial markets battered, just you watch how much more afraid the *farsighted* politicians become to tout Amnesty and other rights for illegal immigrants. I've predicted this all along and I have history on my side.

There are even anecdotes of illegals voluntarily returning to the Third World - if only on a small scale.

Last month, while vacationing in the Hamptons I filmed about 100 illegals hanging out during midday - with job prospects fading by the minute.



Now I've gone to Southampton and driven by this spot (between 7/11 and McDonalds) for years. Either the crews hanging out there got much larger than I remember or the quantity of day labor demanded recently fell off a cliff.

The fact is, illegal immigrants were a symptom of a booming economy (2002-2007); they were hardly the linchpin.

On the other hand, as for our prison *business*...

Something like half of incarcerated Californians are *undocumented*.

And something like 20% of all federal inmates are also, as Bloomberg would call them, *day laborers*.

Mixing It Up

I snapped that pic yesterday morning - click to enlarge. I skipped Montauk Downs and tried a new golf course - Long Island National.

Amnesty For Placeholders

So I played Montauk Downs yesterday.

I set my alarm for 3 AM. After a bowl of oatmeal and a "GI shower" I tip-toed out the door at 3:40 AM. By quarter to five, I was standing in line at the pro shop. A handful of people had beaten me there. (Montauk Downs is a first-come-first-serve golf track. Read my prior post.)

One of the gentleman in front of me was a dapper Mexican. His hair was slicked back and he looked more like a butler than a day-laborer. I figured he wasn't waiting for a tee time because, well, I have never seen a Mexican playing golf AND because he was wearing jeans. Yet he was first in line.

When we got into the shop, while the rest of us were intent on the earliest tee times, he asked for a 10 AM start - which for some odd reason wasn't available.

Do y'all realize what was transpiring here?

Some rich dude ("el jefe"?) in the Hamptons made his undocumented worker get up well before the crack of dawn to secure his desired tee time. While he slept!

I could be wrong, but I believe they use wristbands at Bethpage to preclude this type of subterfuge. Prior to that, local guys would get to the course early, and then peddle their tee times to flush in-sleepers in the parking lot.

Anyway, this placeholder at Montauk jarred the faint memory of my *education*.

Didn't rich bastards used to send their slaves and minions to fight wars in their stead?

Hamptons Hodgepodge

Most adroit shoppers know that yard sales are often gold mines of cheap goods. Whether it’s antiques, a baby stroller, golf clubs, or an Oriental rug, many a good deal (for the buyer) has been struck on a driveway near you. It almost goes without saying that the shopping cognoscenti all race to the yard sales before everyone else. “You just have to go early”, they say.

So I had to laugh at sign I saw this week in Southampton, New York. It was advertising a flea market that opened at 9am. General admission was $2 but early bird admission, from 7am to 9am, was $20. Hey why not? Price discrimination is a tool at everyone’s disposal. This amounts to nothing more than the flea market operator grabbing a slice of the best deals.

On the subject of the Hamptons, summer playground of the wealthiest people in the world (and multi-thousandaires like me), since so many of my acquaintances are dying to make a visit and check out this part of Long Island, I will give a primer.

First of all, the “Hamptons” is a large geographical area. It encompasses Hampton Bays, West Hampton, Southampton, Bridgehampton, and East Hampton. (I’d include Amagansett and Montauk too). As a big area, there’s an entire range of people out there, from 22 year old Manhattan summer house renters, to the townies that have lived there for generations, to the $50 million estates in East Hampton. There are also tons of people from all over the country that rent a house for a month (anywhere from $6,000 to $200,000 for a summer month). Many times it's for the mother and the children. Maybe Dad takes a full week and drives out or flies up on weekends.

There’s one road that traverses them all. Route 27 moves at a snails pace on busy days and is a veritable parade of contractors, landscapers, and illegal immigrants coming out each morning and then going home each night. There’s so much work to do and so much money to pay for it, all of the smart plumbers, contractors, etc. are out there cleaning up – literally and financially.

Despite the expansive area, the Hamptons is not a vacation destination for everyone. Some of the activities can be very expensive. Restaurants in particular price food at Manhattan levels – but many of them lack NYC quality. There used to be a Thai restaurant called Chinda’s between Southampton and Sag Harbor that I have had the unfortunate experience of dining at. Pad Thai was $18 and it was the worst I’d ever had in my life. I also remember at $15 omelot at a diner that I never revisited. We ordered takeout recently, two pizzas and a side of spinach - $50. Last night I saw $27 fajitas on the menu at the Driver's Seat. Ritzy beach towns everywhere have their share of rip-off restaurants. If you can’t cook or operate a grill, be prepared to spend some dough eating out.

As for bars, about tens year ago I was appalled when I saw the price of beer at The Drift Inn (Hampton Bays) and the Surf Club (Westhampton) …… I was acquainted with paying $5 for a beer in Manhattan, but at these bars, $5 didn’t get you a Heineken or a Guinness draft, it got you a CAN of Miller Lite. As for the swankier places like Jet East in Southampton, don’t be shocked when people that come 30 minutes later get in before you. The bouncer subjectively picks who gets in next. If you go, dress up, bring the best looking girls you know, and don’t forget your wallet. I am not sure what the exact prices are, but it works like this. You don't order by the drink, instead you order a bottle of Absolute or Kettle One for like $300 (it could be more) and they give you the mixers, tonic, juice, etc. on the side.

Speaking of bars, if anyone needs some spare cash, I would highly recommend becoming a gypsy cab driver in the Hamptons. When the bars let out at 4am, there are plenty of drunk kids in need of transport home. You buy a van or Cadillac, pick up some drunk girls and charge them $150 for a 20 minute cab ride home. Believe me, they can and will pay whatever you ask of them. Drunk guys pay as well.

As to the politics out on the so-called East End....click here for a hint.



Now it's not like California, but look at some of the whackiness I found in the local paper.

An ad for Organic Cleaning, another for Organic Poison Ivy Removal, and an ad for Personal iPod Consultation - which is clearly for those old Luddites with the groupthink gene. Hey fossils, if you can't figure out an iPod, then you probably shouldn't have one.

All mockery aside, I am all for the proprietors of these businesses. I have nothing but the utmost respect for capitalists that separate rich fools from their money.

The paper also had this inane listing on the Kid Kalendar.

LEARNING ABOUT MARINE CONSERVATION - 8/13 - 9-10:30am. Patricia Paladines will use English and Spanish to talk about life that inhabits the oceans, encouraging multi-cultural discussion of ocean conservation. The group will then make a papier machee sea turtle and prepare to send as a greeting to the children of the sister church in Havana, Cuba. There will also be jelly fish cupcakes, sea turtle veggie munchies, and green algae tea for refreshments. At the First Presbyterian Church of East Moriches, 389 Montauk Hwy. 631-878-4175.

A "multi-cultural discussion of ocean conservation"???????

And how do you get a turtle into a "veggie munchie"?

Devil's Advocate - It's probably shaped like a turtle, but still made of vegetables...

Well in that case, the kids will still be eating something that looks like an animal. Seem to be slipperly slope, no?

Someone asked me the other day if I was a vegetarian. My response,

C-Nut - No. But many of the animals that I eat are...

Here's another good one.

If God didn't want man to eat animals....then why did he make them out of meat?

Back to Dan's Papers, the Hamptons' local paper.

A few years ago, I was skimming the classified section and came upon an ad something like this,

Two young professional women from Manhattan willing to house sit in the Hamptons on weekends....

So I picked up my cell phone and called the number provided.

ProfessionalWoman - Hello.

CaptiousNut - Hi, I am calling about your ad in Dan's Papers.

ProfessionalWoman - Yes.

CaptiousNut - I have a rather large house in East Hampton but I am going to be away this summer. I don't want to rent it out but would like someone to watch over the property. Is this the type of service you'd be willing to provide?

ProfessionalWoman - Yes. (probably getting excited)

CaptiousNut - My house is on Dune Road. Do you know where that is?

ProfessionalWoman - Yes. (probably jumping up and down)

CaptiousNut - So let me get this straight. You'd be willing to come out and house sit my beach house each weekend. How much would I have to pay you?

ProfessionalWoman - Well. Uh,....

CaptiousNut - WHAT ARE YOU CRAZY!!!! YOU THINK SOMEONE IS JUST GOING TO LET YOU "HOUSE SIT" IN THE HAMPTONS FOR FREE. PEOPLE SPEND TENS OF THOUSANDS OF DOLLARS TO STAY OUT THERE. NO IDIOT IS GOING TO LET YOU "HOUSE SIT". (hangs up)

It was so funny. The other passengers in the car at the time of my call, my future wife and future mother-in-law, were in such hysterics that we almost had to pull off the Long Island Expressway.

Here's what "Dune Road" looks like,



It's a sandbar on the ocean - with no starter homes. That house pictured above is known as "The Castle". I've heard that it has shark tanks and 27 bathrooms.

What I absolutely love about the Hamptons is the sheer beauty. There are so many farms, mansions, deer, and water all around. The Shinnecock and Peconic Bays are almost as stunning as the ocean. I have to say that, by far, the southern shore of Long Island has the most gorgeous beaches I have seen. For one thing, the beaches don't end in either direction. You could walk forever. All you will see is a few people and bold mansions every few hundred yards (perhaps some topless women to boot!). I generally go to a beach in Bridgehampton that only has about 20 parking spots. You either have to get dropped off or get in line and wait for someone to leave - which could be a while if you go on a weekend. The Southampton beach does have a parking lot, but even that isn't very big, it fills early up as well, and it costs $30 to park. As far as I am concerned, that is a very cheap price for spending hours in such a spectacular setting. There are no boardwalks, no funnel cakes, and no blaring salsa music - Robert Moses would be at home.



What the heck is a "Justice Center"???

Anyway, after enduring 20+ inches of rain in April/May up in Boston, the weather here has been a pure godsend.

In 4.5 weeks, it hasn't rained once.