Preschool/School Reminder

I want some of y'all that might have missed this blog post of mine from 1.25 years ago to check it out. I believe it's one of my more important posts for parents of young children:

Complete Book Review - Hold On To Your Kids

Unsocialized Outsourcing Parents!

There's a *fun* article in the Boston Globe this week - The Daycare Squeeze.

Yeah, it's on a subject - the (financial) costs of daycare - that I'm thoroughly uninterested in - heck, if it was FREE I'd still be vehemently against daycare! But still, the comment section was fun to read. Outsourcing parents and insourcing parents simply do not get along, at all!

Of course, you'll never hear anyone say *you know, I daycare my kids but don't think it's good for them at all...*

No. Invariably they have to spin it positively, for those nebulous *socialization* reasons:

Deedeela wrote:
Childcare is expensive, however if you find the right provider/center, it's an investment in your child's future. I am blessed to have a wonderful in-home childcare provider, who is struggling to keep her head above water, just as I am, but doesn't skimp at all in what she provides my 2yr old in such a great learning environment!


just1voice wrote:
Both my husband and I work full-time, standard 9-5 hours. We use a combination of a nanny and family daycare. Definitely not cheap, but cheaper actually than many daycare centers. Would suggest looking at the immigrant community for baby sitting services. You can still find someone legal, but you'll get lower rates and your child will learn a second language for free.


tb151 wrote:
My wife and I are around 30 years old and we have a 7 month old son. I can personally speak for this age group from experience. I don't know anyone who is having children in teh Boston area, who don't have some special circumstance allowing them to do so. Either they are lucky enough to work from a home office, have family very close, or have serious family money. The cost of childcare is a national problem...


northeastern1 wrote:
I pay more per month on day care than I do for Rent; However, if either one of us stayed home rather than work, we couldn't afford the bills. The extra income is more than the daycare cost so we have no choice but to both work in order to pay the bills. Those who think its easy to do it with one income clearly don't realize what average people earn (even college educated). I will admit we can't afford to have a second child anytime soon due to the high cost of daycare; However, the benefits of having a good day care are well worth it. Having my son socialized around other kids at a young age is invaluable...


pawnrule wrote:
We have tried in-home care and family day care. As other comments have noted, the difference in social skills for our son in day care and in-home care is significant. He is much better in social situations after going to day care. The career gap by taking time off can also be a stumbling block. Although we are just breaking even with day care costs and salary it makes sense to get through the early years by putting our kids in daycare.


A disturbing trend in society and in some of the comments here is the harsh judgment on parents. It has become a social past-time to judge parents and their choice. Parenting is difficult and each family weigh their circumstances and makes choices. I would personally appreciate more support from society.


That being said the solution to this problem can be much like the K-12 systems. Another globe article pointed out the increasing demand for Catholic pre-school. I believe we can have affordable day care by providing public pre-schools and daycare. There are qualified teachers and care providers and safe school facilities in our towns. The cost is then socialized and will reflect societies priorities with children. To state an old saying "It takes a village to raise a child".


nooshmom wrote:
As interesting as it is to hear the high and mighty stay at home families claim their kids are better off than daycare kids, the most recent studies have shown kids in childcare have a much easier time transitioning/socializing in school. Ever notice which kid at the playground is losing his head because he's forced to share?


Jcon wrote:
My wife and I both work and have great jobs. We send our daughter to day care 4 days a week and one of us stays home on the other day. Both of our jobs are higher level and also offer us the flexibility of working from home every now and then. It is an online world and we can take advantage of that sometimes.


Our daughter is just over 2 and has been in day care since she was 6 months old. The day care center is amazing and is on my wife's corporate campus. Yes it is expensive ($1500/mo) but is worth every dime. Our daughter loves it, she loves her teachers, we love the quality of it. She learns so much there that we would just not be able to teach her if she were at home with us all day. She has friends and loves seeing them every day. When we go to parties and play groups on the weekends we can see the difference between the kids who go to day care and the ones who stay at home. The day care kids are much more adventurous and social; they play with each other, talk to each other, and share their toys. The kids who stay at home with mom all day tend to be shy and reserved, cry and hit when another kid wants to use their toys, and tend to not go far from their parents.

I don't know which comment made me laugh harder - the last one which asserts that daycared children are noticeably more *social* than parented children...

Or the self-justifying one atop that refers to daycare as an *investment* in their child's future!

I did post a couple of comments towards the end of the thread.

In one I included this zinger from a previous post - Daycare = Child Abuse:

Not only are the seeds of peer orientation sown in day care and preschool, but the fruit is already in evidence by the fifth year of life. One of the largest studies ever done on this subject followed more than a thousand children from birth to kindergarten. The more time a child had spent in day care, the more likely she was to manifest aggression and disobedience, both at home and in kindergarten. As discussed in previous chapters, aggression and disobedience are the legacy of peer orientation. The more they had been in day care, the more these children exhibited counterwill as indicated by arguing, sneakiness, talking back to staff, and failure to take direction. Their elevated frustration was indicated by temper tantrums, fighting, hitting, cruelty to others, and the destruction of their own things. These children were also more desperate in their attachment behavior: given to boasting, bragging, incessant talking, and striving for attention, as we would expect when attachments are not working.

A great retort for any of these types of arguments on procreation, daycare, or homeschooling I've found is to simply agree:

Yeah, I don't think YOU should be having children.

Yeah, I don't think YOU should be at home raising the kids.

Yeah, I totally agree that YOU aren't qualified to be homeschooling your kids.

Marginalizing Off-Droppers

A couple of weeks ago, IN MARCH, I was at the park on a beautiful afternoon.

I was surrounded by all these shiftless *moms* who were breathlessly yammering about the *summer camp* they were ALL sending their children too.

"But do we get to meet the individual counselor who's watching our....oh, good. I feel so much better..."

My wife laughed at me re-telling this story. She said I had *no clue* and that all the *good camps* were already booked sometime in the winter.

And there was this other *mom* there that I knew. After morning kindergarten, she dropped her kids off at *Su Escuela*, a preschool whose shtick is that it supposedly *teaches Spanish* to kids who well, don't even know English yet. She was killing time at the park, an hour or so, and then had to leave for her third *off-dropping* destination of the day.

CaptiousNut - Where are you going?

OffDropperMom - I have to take them to MyGym (an indoor gymnasium)...

CaptiousNut - What? Are they in a class or something?

OffDropperMom - Yeah.

CaptiousNut - How long is it?

OffDropperMom - 45 minutes.

CaptiousNut - Ouch. That's 25 minutes away from here. What are you going to do while they're at MyGym?

OffDropperMom - I don't know. I'll probably go to Starbucks.

CaptiousNut - Well, it's too bad you have to leave the park when it's so beautiful out and there's so many kids here...


Today after my daughter's ballet class I had to endure more of this *outsourcing* blather. A few *moms* were going on about which *pre-K* program FOR NEXT YEAR was best; which ones have waitlists; which ones were their second choices; etc.

While these broads just sit there, sipping coffee and prattling on and on about strategies to give them more time to.....well, just sit and yap some....I spend that 45 minutes in the adjacent room, reading to and doing algebra with my 5.38 year old son. (And if I'm not doing that, I'm reading a weighty book...)

One of the local community centers nearby is awesome - only it's extremely underutilized. So why is that? Why don't all the parents take their kids there to play, eat lunch, and *socialize*?

They don't take advantage of this wonderful place, not even in the middle of the 5 month winter or during the week-long monsoons because IT'S NOT A DROP-OFF PLACE. And that's all these malpracticing parents are looking for - something nearby that will *relieve* them of their children. For proof I offer this one particular BS *class* they do offer there for off-droppers. On Thursday nights, twenty 5 year olds are shuttled in by slender *moms* in their flattering yoga pants. By my calculation, 90%+ of these children are never EVER at the community center for anything else. While it may be a great place for the kids....the place doesn't allow *mom* to get her tennis, yoga, or shopping in!

I submit that this is off-dropping is a disease; it's just that 97% of parents are afflicted so they haven't a relative clue how sick the mentality is. Sick sheep, that's what they are!

Pre-School - Expensive AND Injurious

Two days per week, my 3.72 year old daughter attends preschool at a local community center, for 2.5 hours time. It's cheap and it's close. I consider it nothing more than convenient babysitting.

But no longer. The State of Massachusetts just stepped in and declared it *unregistered* or *unlicensed*. Thus, this particular program can only offer 6 days of classes per month, henceforth.

Now I've never been overly fond of daycare or pre-school, and 6 days per month is plenty for me. Getting ready, dropping off, and picking her up from pre-non-school kills the momentum of my day. I was elated when my son stopped going last year. And I'm very much looking forward to the Princess' last days. This way I can get the kids into a more efficient and regular homeschooling routine.

Getting back to the BS licensing issue...

While it represents a clearly unwarranted, illiberal meddling in the affairs of individuals, there's the consequence that all the regulations end up *taxing* away preschools. And THAT is a good thing indeed!

Side Note - Recently I was talking to a local *mom*, an acquaintance. She told me that she was a *big believer* in preschool, *lots of preschool* in fact. I asked her if she researched this belief. No answer. I informed her that children who are heavily daycared have half the vocabulary of 5 year olds who weren't. I told her, I had plenty of material on this subject I could send her.

CaptiousNut - Are you interested?

LocalMom - Nope.

CaptiousNut - You don't even want to take a look at it?

LocalMom - Nope. I'm not interested. I'm a big believer in preschool.

And there you have it folks, a circular self-fulfilling argument against Moronic parents (products of Big Education) teaching their own!

I just can't tell you how many times I've endured this same tragic conversation. The first 50 times, I was really trying to be helpful. But now I'm jaded by the .000 batting average. Now I just provoke for my own self-amusement.

Pre-School Application

The only intellectual arena where I am weak is the finer arts. One might even say I'm *culturally illiterate* - though I've been making inroads in the past couple of years.

So while I can competently teach my kids reading, writing, history, and definitely mathematics I'm incapable of introducing music, art, and dance. This will have to be outsourced.

It just so happens the local arts center has a pre-K program that presumably fills this very need of ours. (It would start in September for my son.)

My wife had checked the *school* out already and wanted me to go observe as well. On my way out the door last Friday she admonished me to "be nice to them".

Apparently this particular pre-school is *invitation-only* - and we know others who've taken their kids to observe and never heard back. Plus, apparently I have a proclivity to be *not-nice*. Who knew?

"Whatever," I said, "As far as I'm concerned, I am INTERVIEWING them!"

I took my son the other day and we stayed in the *class* for about an hour. Kids were painting - but not unlike where they do elsewhere. I saw no formal instruction - no emphasis on perspective(?) or anything.

The teachers excitedly showed me a letter book that the kids were working on. Today they were tracing the letter K.

Tracing the letter K?

Couldn't these 5 year olds write a single letter freehand? That is a 3 year old skill.

I told them my son was so far beyond that; that he was full-fledged literate; and they quickly changed the subject. [Later I had him demonstrate his ability to multiply.]

What about the *arts*?

I got only vague answers. And all I witnessed was that they piped the room with classical music during *free play*.

So how'd the interview turn out?

Well, the school did OK but it didn't wow me by any stretch.

I don't really like the fact that it's four days a week. Next year I'm comfortable with two, maybe three days of this glorified babysitting for my son - four is pushing it. [Four days a week, three hour sessions.]

And then there's the cost - $4,775 which they advertise is for the 32-week school year.

If it includes school vacation weeks, then it works out to $12.45 per hour which doesn't sound that high but I maintain that it is - especially considering that it's more hours than I want to begin with. And it's really only cheap compared to the $34 per hour Montessori school nearby.

They loved my son there. They were astonished how he went right up to and *socialized* with all the other kids even though he's a full year younger.

[My eyes rolled more than a few times.]

My wife's admonition was practical. She said be nice so that WE have the option of sending Prince C-Nut there. She said, "let us make the decision, not them."

In that vein, I was going to have my son send an email thank-you to the teachers this weekend but didn't get around to it. What do ya know, in the mail Monday was an "acceptance" letter from this pre-school. Heck, they must have sent it out the second we walked out the door on Friday. At least the email was no longer necessary.

Either they really need kids for next year or my son impressed them. And how could he not - given the gross infantilization of his age-mates?

There'll be no rush to write a check and reserve his spot. The school's *application* for my son is under review.

Stocks, Houses, And Excuses

Sorry for the deafening silence, my flock. I've been tied up trying to re-file my 2006 taxes. I knew the code was labyrinthine and ridiculous, but now I have a deeper appreciation for that characterization. In years past I have always channeled my trades through a business entity or at least used an accountant. But last year I essentially reported my trades as a non-professional customer and I tried to hammer out the forms myself. I made several mistakes and the IRS took notice.



Otherwise, I have been trying to recover from a serious loss I took trying to catch the falling NASDAQ knife. I actually came in really short to start the year but, of course, got flat too early, and then long too soon and too much. As of now I have dumped the position and am chipping away at the deficit.

Today I dumped Newmont Mining and shorted both Bank of America and Capital One Financial (at 54.90, 41.77, and 51.69 respectively). Newmont has actually been a core holding for a while; the mere seven points I made on it will at least get filed as a long term gain (before the AMT kicks it to 21%, effectively a higher tax rate than I would have paid a few years ago with a 20% capital gains rate.)

Gold has exploded and Newmont has barely budged. Reasons for this under-performance abound: higher production costs (think oil and electricity), political extortion, problems replacing reserves, etc. It suffices to say that in hindsight, I should have bought the physical metal in lieu of Newmont shares. I did make some good money in the stock over the last several months: I bought the Jan70 calls at 1.50 and sold them at 4.00, I flipped the June50 calls, and I scalped the stock a few times.

In fact, Newmont was one of the first stocks I ever traded. Back in 1996, gold was $385 per ounce and NEM was $60 a share. Today, gold has rallied to $920 an ounce and Newmont is merely $55. That is some serious underperformance over a 12 year period and it reminds us of Jim Rogers' assertion that mining shares have been the "worst" sector to invest in throughout the history of the stock market.

Just about all I have left in my account besides Google (bought some more today at $550) is a sizable position in Coeur d'Alene, a silver mining concern. I own the stock and January calls (both the 5s and 7.5s). That's another mining position that has pathetically underperformed the precious metals.



I've been pretty much cleaning house in my trading accounts. Gone are my commodity positions that I promised to "never sell": cocoa, coffee, sugar, and cotton. I also covered my short euro position. I actually got out at a great price on MLK day when just about all the domestic markets were closed. If you remember, the Dow futures were trading down 550pts that night. Pretty much the only reason I covered my short euro was to free up some capital for what was going to be a most volatile Tuesday morning. If you recall, I got short at 1.47; rode a loss up to 1.49; then was fortunate to cover at 1.4433.

That euro unwind worked out great as the euro has since bounded back to 1.4755 and I was able to buy the Dow futures early Tuesday morning down 550 points. Not even a couple of hours hence, the Fed predictably made a "surprise" 75 basis point cut in the Federal Funds Rate - and I dumped my Dow Futures for a most rapid 274 point profit!

This is the story of my career. I get killed on my large bets but clean up on the little ones. However, my account purging has been more deliberate than distressed. There's simply so much intraday volatility that I want to take advantage of. In these times, it's best to play it small and nimble. With all this trading opportunity, one doesn't have to swing much of a bat to make $$$$.

These days, I would LOVE to see a big financial stock rally so I could short the lot of them. Selling into financial rallies is and will be one of my game plans for the foreseeable future. Now enough of this boring stock market stuff

Do you watch HGTV?

I admit I watch it aplenty these days. Usually I tape the shows and cruise through them to see the conclusions. Did they buy the cheap house or the one "over their budget"? I also like to see the fruits of "updating".

My wife is less tolerant of some of these shows - and she has a point. Who the (blank) vets a mere three homes and then buys one of them? I'd look at twenty before I even signed a rental agreement!!!

The other day they had on some newlywed couple in Colorado who left their rental (replete with roommates) to "buy" a mountain house for around $210,000. They said they were anxious to stop "wasting money on rent". So what did they do? They bought with 100% financing and a 5-year interest-only loan at 6.87%. They went the interest-only route to "keep the payments down". So after paying $1,400 a month for 60 months - a total of $84,000 - their loan will need to be refinanced at prevailing rates AND they will obviously have zero equity.

So much for not "wasting money"...

Does this sound like anyone you know?

There's another show on HGTV called "My House Is Worth What?" with a most insane premise.



In a nutshell, here's the show - some idiot homeowners guess what their house is worth and then, a real estate agent comes in to give their own best estimate.

The discrepancy between the two "guesses" is mostly a function of the homeowner's ignorance, the real estate agent's perma-optimism, and of course, the current state of the housing market.

It'll be fun to watch the reruns of this show as the housing debacle drags on for years. For example, "Joe and Susie paid $750,000 for this bungalow in Miami. They put about $100,000 more into it...and now, only 6 months later, it's worth $1.5 million!"

That was definitely how the show started out a year or so ago. Now it'll be Joe and Susie's $850,000 investment is on the market for $700,000. Ouch.

Incredibly, this show is mostly about home equity loans. The inquiring homeowner wants an appraisal because they want to take out money to either do an addition or renovate kitchens, baths, and basements. They want to know if they will "get the money back" that they plan on borrowing and "investing" into the house.

It's an insane line of thinking:

My house is worth 500k and I only owe 400k. If I take out 75k to redo the kitchen, my house will be worth at least 575k, so it's a good investment.

Bullsh*t. Renovations should be seen more like SUNK COSTS because you pay interest on the home equity loan and because as you enjoy them, they DEPRECIATE. In fifteen years, your 75k kitchen will be dated; so figure that depreciates at a tune of $1,000-$3,000 per year. Home equity loans amount to borrowing against the future for present consumption. THEY ARE NOT INVESTMENTS.

In fact, today in the marketplace, bonds backed by home equity loans are quite distressed. Largely due to their status as secondary liens, HELOCs are currently trading at pennies (20?) on the dollar. In other words, the primary mortgage owner has first dibs on a foreclosed home and the second dibs, these days, are worth almost nothing.

I wouldn't recommend taking out a home equity loan for renovation UNLESS one had a boatload of equity or sufficient cash on hand to pay off the loan. I just don't get the idea of BORROWING for present consumption. It's this mindset that's made America a nation of debt slaves.

How's this for a radical concept - If your basement costs ten grand to finish....then DON'T DO IT until you have ten grand saved up!!!



This weekend, for kicks I walked through the above "open house". It's been for sale for 200+ days and was recently lowered from $1.7 million to $1.159. It's "relo-owned". Meaning some company moved an executive and essentially bought his house from him. In this case, Frito-Lay is the new homeowner - and they can't be too happy about it.

It's a gorgeous 4,800 square foot home and it's only a few years old. It's way too much house (and money) for me. Taxes are $14,000 a year and when I asked about the heating bill I received this doozie from the realtor,

Realtor - This house is tight. The heating bills weren't bad at all. Only five thousand last year.

CaptiousNut - (laughing). Only five grand huh? Last year was one of the warmest winters on record and oil was nearly 40% cheaper.

What a Moron!

Or, she must think I'm a Moron.

Lemma - Housing prices will go back to 1998 levels.

You think I am crazy, right?

About now, generally speaking, we are nearing 2003 averages. My Lemma is based on the fact that carrying costs are much higher now than they were ten years ago. Property taxes have only been rising; insurance premiums are higher; and utility bills have exploded. Sure, incomes are up, but we'll see how long that lasts.

It's my contention that people across the land STILL underestimate the total costs of homeownership. For example, in this day and age, Americans change jobs all the time. And despite CraigsList and FSBO options, it still costs about 5% to sell one's house. So add on to the higher carrying costs of today's homes, what I submit are higher transaction costs. If people sold one home every thirty years before, I'll bet they are now selling 2.5 every three decades.

In this vein, I believe it's ridiculous for anyone to take out a thirty year mortgage. Okay, maybe it's not completely ridiculous, but what home buyers should probably be looking at is the comparable 15 year fixed mortgage payment. Allow me to illustrate.

Today, a 200k fixed-rate loan at 6% for thirty years would cost $1,200 per month.

The same loan on a 15 year term would cost $1,688 per month.

If $1,200 is the monthly payment you're comfortable with, then reverse-plug it back into the mortgage calculator to see how much it'll allow you to borrow on a 15-year fixed-rate loan.

It turns out, with a fifteen year loan, $1,200 per month will only borrow you $142,000.

Mind you, that's on a non-jumbo sized loan.

If a larger borrower took my advice, instead of taking a 600k 30-year mortgage out, they would reduce their home buying budget proportionately - by $174,000. In this case, if they wanted to be debt-free in 15 years, they'd reduce their intended mortgage to $426,000.

In my opinion, housing could easily see 1998 prices again because buyers are not only paying prices at the top of the historical range,



...they are underestimating the carrying costs, transactional costs, and they are of course assuming steady and gainful employment.

The only thing "steady" in my life is the onslaught of higher monthly bills. Remember, I don't even own a money pit; nor do we have car payments or student loans to pay. Two kids all by themselves are budget busters. They consume more clothes, food, and money each year. They've increased our healthcare costs and introduced a "babysitter" budget that is also relatively new. Their education (whether outsourced or not) could easily cost a tremendous amount of money. Every young family's expenses are on the same, unavoidable, upward trajectory. AND I haven't even talked about inflation.

The fact remains, consumers have too long underestimated their future expenses and overestimated their earnings potential. A fifteen year mortgage makes a ton of sense because of all the new financial burdens that keep getting dropped in your lap. In fifteen years, my son will be going to college - at that point I'd like to be done paying for my house. Furthermore, how the heck do these maxed out, credit card-ramping, home equity-tapping Morons think they are going to save for their own retirements?

Social Security?

Hah! Tell me another one.

Alright, time to sign out.

But I want to ask you people a question. If you daycare your kids at 12 weeks so both parents can work and you can afford the larger mortgage....if you justify it by claiming that daycare is good for the baby's "social skills"...

Don't be surprised when you're old and grey, collecting a Social Security spare change, have no savings to live on, and your spoiled, individualistic kids send you to El Cheapo Nursing Home. Even if they have the big house, and plenty of room for an 'old coot' they will still send you away. They will outsource care for you just as you did for them as daycare babies.

I can't count how many times in recent years I have heard people plop their aging parents in nursing homes, assisted living communities, or the DNR House and quip, "Well, it's better for them socially to be around their peers."

Behold the irony!

Even if you don't teach your kids, they will learn from you.

More Marketing Misnomers

Bright Horizons is of course a daycare chain.

This morning I saw a sign for one in nearby Hingham and was taken aback by their marketing slogan.

Family Solutions?

That sort of implies that 'Family' (small children) is a problem, does it not?