Musings from the Coast

With all the talk of the Big Ten expanding there is much talk about what the SEC should do.  Most of the talk centers around expansion.  Expansion for the SEC would be a mistake.  It would be a wiser move to jettison some of the hangers on (looking directly at you Mississippi State, Vanderbilt, and Kentucky).  Other than regional proximity Mississippi State, Vanderbilt, and Kentucky bring nothing to the SEC other than Kentucky’s basketball program.  So Kentucky gets a reprieve.  Kentucky is resonably competitive in football and helps legitimize the SEC in basketball to keep the RPI of the rest of the conference up.  Kentucky you get to stay Miss. State and Vanderbilt can join the Big East or Conference USA.

Now that the dead weight has been jettisoned who should the SEC take?  The list includes Texas, Oklahoma, Texas A&M, Florida State, Clemson, Miami, Louisville, and South Florida.

Let’s not fool anyone the one school everyone wants is Texas.  The Big Ten wants Texas to deliver the Houston, Dallas, and San Antonio markets to the Big Ten network.  Texas would enable the SEC to beef up their deals with CBS and ESPN.  Texas will deliver a lot of TV sets to the conference that they join.  Texas does not come without baggage.  Due to political pressure back in the early 90’s the Longhorns had to take Baylor and Texas A&M with them to the new Big 12.  Texas A&M would not be a problem Baylor is a problem for the same reason Vanderbilt is a problem.  Texas A&M if very similar to a SEC school.  Texas A&M has the tradition in fanaticism of a SEC school which would endear them to the rest of the conference.  The problem with Texas A&M is that their own field performance has been horrible in the past ten years.  Before the turn of the century Texas A&M was a team right there in the thick of things in the top 25, not so much lately.  The biggest problem with Texas and Texas A&M joining the SEC is geography.  Maybe having Texas would offset the traveling expenses with the increased revenue.  Another side benefit to adding Texas and Texas A&M would be the renewal of the old Southwest Conference rivalries between the two Texas schools and Arkansas.

From a competitive stand point Oklahoma and Texas would be a better fit.  Oklahoma brings a solid football program and top notch teams in all the other major college sports.  This would also be an easy way to keep the red river rivalry alive.  Once again geography is a problem.

More realisticly, Florida State and Miami would work out logistically.  FSU and Miami do not bring the financial perks to the conference but they do keep things regional.  The one hinderence would be the FSU chickened out in the 90’s becuase they did not want to play Auburn and Alabama every year.  I am not sure if this is an issue anymore but it maybe.  There is an easy rode through the ACC than there is through the SEC.  Although, I am not sure going undefeated in a weak ACC gets you into the BCS title game.  A one loss SEC champion would have a better shot at it.   However, it would be nice for the three big Florida schools who have more a less dominated college football for the last 25 years have to play each other every year now.  This may not be a selling point to Florida.

The other option would be trading Clemson for Miami and bringing in Clemson and FSU.  Clemson would fit better in the SEC because there is more tradition and the fans are very similar to SEC fans.  Competively Clemson does not bring much other than they are much better than Vanderbilt or Miss. State.

Louisville would be an okay fit.  The problem with Louisville is their football program is inconsistent.  While their basketball program would help the SEC’s RPI they would need to stabilize their football program.  Maybe they could be a provisional member based on geography.

South Florida is an up and comer in D1 athletics and has proved they can play with the big schools.  South Florida is in the middle of a recruting hot bed so they could potentially be a player for a long time.  The university has proven that it is dedicate to having a competitive D1 football program so they would fit in the respect.  I am not sure how the rest of their sports programs would fit in.  USF may not like being in the same division with Florida because they would never have a home game.  I think every time the Gators played in Raymond James stadium there would be more orange and blue than green and gold.

Texas makes the most sense from a financial perspective but I just don’t see it happening.  If the SEC cannot get Texas they should at least upgrade the competition in the conference.

Someone else will have to figure out how to realign the divisions.

For those of you that you that think you are going to stick it to BP for dumping millions of oil in the Gulf of Mexico by not buying their gas you are wrong!

The Oil & Gas industry has not been vertically integrated for quite some time.  For those of you that have not spent hours in business classes in college or graduate school vertically integrated means, in this case, that BP owns the oil well, the refinery, storage terminals, the fuel trucks, and the gas stations.  The simple fact of the matter is most gas stations are owned by sole proprieters or small companies that own a handful of stations.  Most oil companies sold their gas stations to others long ago and just sell their branding (franchising) to gas station owners.

The reason this is possible is that gas is a fungible commodity meaning that it is all the same so there is no difference between the oil refined into gasoline by Exxon, BP, Shell, Chevron, etc.   Oil is refined and shipped to a terminal for purchase.  The gasoline then is purchased from the terminal by stations that need gas.  When the gas is picked up then whatever additive the branded station touts is added to the gasoline once it is loaded on the truck.  All the gas is pumped into a tank and commingled so you are never sure who actually refined the fuel you are buying.

That’s right all of you that boycotted Exxon after the Valdez catastrophe in 1989 have purchased Exxon gas probably more than once without ever knowing it.  Sorry to have burst your bubble.  By boycotting gas stations you are putting people not unlike yourselves out of work or business.  If you want to truly stick it to the oil companies you will have to stop using refined petroleum products all together.  Good luck with that, I think it might be impossible.

Please don’t think that I am by any way excusing what happened in the Gulf of Mexico.  I personally think that gas prices stabilizing while being the best thing for the economy at the time was horrible for the environment.  Solving our reliance on oil would solve most of our political problems abroad (if you don’t think Saudi oil money is going to terrorist call me about some real estate I have for sale) and some of our environmental problems at home.

I read this over at the Wizard of Odds today and it got me thinking about which out of conference match ups I would like to see the most and why.  I am going to start with the school that we cheer for the most around here the University of Florida.  Mrs. Billy Clyde earned a masters degree from UF when they won their first National championship and she has been crazy about the football team ever since.  My alma mater has not done much other than beat Texas A&M 12 years ago and scaring a couple other DI power housed in the the interim so there really isn’t much to talk about so here goes.

The first school up would be the University of Texas.  I grew to hate all of the Texas schools when I lived there except for Rice, Houston, and TCU (I like under dogs).  A Texas Florida match up would be great for college football even with my hatred aside.  You have two storied programs that have had a ton of success in the last ten years.  Both schools are recruiting power houses in state and nationally.  You have the different coaching styles of Mack Brown and Urban Meyer.  This would also be a match up of the flag ship universities in the two most football crazy states in the union.  I could only imagine the college football season starting off with these two powerhouses going at it.  I am not sure there are enough adjectives to describe the game day atmosphere in either Gainesville or Austin if these two schools were going to face off in a primetime game to kick off the college football season.

Next up the Notre Dame Fighting Irish.  This one would be great on so many levels that it should be a three game series.  The first game to wet every one’s appetite would be on a neutral field and then after a year or two break they could start a home and home series.  I say neutral but in the south would be preferable.  If the game is in the south it is good for Notre Dame since most of their games are played above the Mason Dixon Line and Florida would not feel like they were giving up too much in return.  The reasons I want to see this happen is repayment for the ‘92(?) sugar bowl, so Urban Meyer can show captain fat ass Charlie Weiss how you coach a college football team, and to show the golden domers they do not rule the roost anymore.  I know USC shows Notre Dame how it is at once a year but having a school that most of Notre Dame’s fans look down on do it would be nice.  My father says I am the worst Catholic in America because I dislike Notre Dame so much.  I say it is time someone ends their since of entitlement when it comes to football. Even if this happened I am sure the golden domers would love to call this another Catholics against criminals series in light of Florida’s recent off field woes.

Finally,  I think the match up for the ages would be USC and Florida.  I do not know of a college football fan in the world that would not want to see this.  Except maybe the USC fans with long memories.  USC and Florida played twice during the Wilber Marshall years and it was not pretty for USC.  All of that aside this would be the match up of the two “It” programs from the east and the west for the past decade.   Granted Florida had a bad three year run with the coach that shall not be named and USC had lost its luster before Pete Carroll took over but now both teams are fixtures in the top ten and are always in the national championship conversation.  This would be a hell of a way to start any college football season for all practical purposes it would be the clash of the titans.  

Where should I start is a good question. I guess with this. We survived hurricane Ike.

I have been through hurricanes before living almost my entire life on the Gulf Coast of these United States. This, however, is really the first one I had floor seats for. I say floor seats because the front row was in the Galveston/Bolivar/High Island Area. The people down there got to see one hell of a show that they may have not been prepared for. Here further inland things were loud and wet but not near as scary. My house seemed to weather the storm just fine, only the roof inspector can answer that question. The hurricane is really just the opening act for the big show.

The big show is the really the aftermath. After 12 hours the hurricane is gone and you have a mess to clean up. It is like that friend you had when you were a kid that would come over and take all your toys out and leave before they got put up leaving you to clean up. On top of that he took the batteries to your cool toys. That is essentially what it feels like.

We have managed to get everything cleaned up but we still do not have power. Not having power for four days now is probably one of the most un-fun things I have done in a really long time. Especially, since I did not get to see one damn college football game on Saturday (for those of you keeping score at home I am still leading my pick ‘em poll [Ed. note — Not for long chump]). I had to retreat to working at the coffee shop on a college campus because they have two precious commodities right now electricity and internet access. So me and the rest of the free loaders are stealing their band width and power.

I have been camped out here since early this morning since my wife works here I had the inside track to knowing if things would be working. So I have been sitting here watching a steady stream of internet users and cell phone chargers shuffle in and out between lattes. I told one of my friends I feel sort of like a refugee at the last power station in the world.

On my list of things to buy now is a generator.  A really big one that can run the AC, refrigerator, and TV.  With my luck the next storm will rip the roof off my house and I will not be able to use the damn generator.

The last day of the college football off season.  I am excited about the South Carolina vs North Carolina State game tomorrow night we will see if the Ol’ Ball Coach has anything left up his sleeve.

I have been reading a lot about personal finance lately. It is not because I have money problems but I am trying to do more with my money and make sure that I am doing the right things with my money which I believe for the most part I am. All of the reading that I have done makes it seem like the problems most people have managing their money are not mathematical but psychological.

I ran across this article on Get Rich Slowly this morning and it really started to make sense to me how most people get in trouble with using credit to finance living above their means. In my experience it starts off slowly. I will buy this TV and charge it and pay it off later because I don’t have all the cash right now and I really need the TV because is as big or bigger than my neighbors. TVs become computers, clothes, hotel rooms, and Airline tickets and all of a sudden you have such a large credit card bill you cannot pay it off when it arrives. All of this happens because credit feels like free money.

Nothing is free especially when money is involved. There may not be anything more costly than “free” money when credit is involved. Part of me wants to know if that credit card companies actually understand that psychology of using credit cards they way most people do and prey on that.

The reason if feels like free money to most people is at the time of purchase you actually are not giving up anything to get something. You will have to pay for it eventually but not right now so all you have to is pick out what you want and give the cashier your magic little card and be on your way. When you pay cash for something you are actually giving something up at the time of purchase and not putting it off until later. With cash you actually can quantify what you are giving up in return for what you are giving and if the item is expensive it may even “hurt” a little.

I am not totally bashing credit cards I think they have their place but you have to use them wisely. A credit card is a tool not an income supplement. I try to use mine as little as possible and in places where I do not think it is a good idea to use my debit card. Also, I pay off my balance at the end of every month. Sometimes it “hurts” more than others but I am not racking up interest and finance charges. It took me a long time to be able to do this but I am way better off because I manage it this way. I always try to make sure I know how I am going to pay the bill when it comes before I buy something with my credit card so I can quantify what it costs and feel it so I do not do something stupid.

A credit card is a tool that you have to learn to use properly like most tools if you do not use it properly you will end up hurting yourself.

Seven days until the return of college football. All of the speculation will be over it will be time for the rubber to meet the road! There are some good match ups the first week with South Carolina taking on North Carolina State in the opener Thursday night. Clemson and Alabama will play in Atlanta on Saturday night and Labor day will be capped off with Tennessee taking on UCLA (which is a match up of two big names in a couple of years this may be a game worth watching). I think the most intriguing match up may be Utah and Michigan on Saturday this will define the season for Utah if they would like to return to a BCS bowl. Whatever happens to Michigan they will be fine they are going to have some growing pains under RR but they will be fine in the long run (I am pretty sure I could coach UM to 5+ wins a season). There are some other good out of conference games coming up early in the season with Ohio State taking on USC and Georgia playing Arizona State in Tempe. Here are my burning questions for the season:

1. If there are multiple one loss teams and Ohio State is one of them do they get another invite to the BCS championship game?
2. Can Georgia hold on to the top spot for the entire season?
3. Will this be the most important cocktail party ever?
4. Is the 2008 season going to be as crazy as the 2007 season (I hope so)?
5. Will there be another BSC buster this year (candidates include: BYU, Utah, and Fresno State)?
6. Is this the end of the road for Joe Paterno and Bobby Bowden as Coaches (as a Florida Fan I hope Bowden stays there until he is 100)?
7. Does a deserving player win the Heisman Trophy again this yes (not being a Florida homer but Tebow deserved it last year because all of the crazy records he set)?
8. Who gets fired first (Ty Willingham, Mike Stoops, or Greg Robinson)?
9. Which off season coaching change has the biggest positive affect on their team (Houston Nutt at Ole Miss, Rich Rodriguez at Michigan, or Bobby Petrino at Arkansas)?
10. Will this be the year that Texas Tech makes some real noise?
11. Are the Fighting Irish going to bounce back are is Charlie Weis a big fat fraud (we know half of this is true)?
12. Who wins this year’s giant killer award (hopefully it will be my Ragin Cajun’s beating the fighting Zookers Illini)?
13. Which team with lofty expectations (Clemson, Georgia, or Missouri) be first out of the National Championship chase?
14. Who will have the biggest impact as a freshman this season?
15. Does the Bill Stewart experiment in West Virginia go down in flames?

If I remember I will come back and visit this list throughout the season.

I have not been able to finish writing anything lately that is why there has been another lull in posting.  Hopefully, I can get my head straight and finish something soon.

This is not a bail out plan. It is not the governments job to bail people out of trouble when they do something stupid. Especially, when they are using my money (and yours too)! So here goes:

1. If your business was/is involved approving, making, buying, or packaging risky loans you get nothing - This is how it works is the real world kids you make a calculated risk based on the ability to get a return on your investment if you calculate wrong you lose your investment otherwise you either break even or make money. The bankers, mortgage brokers, hedge funds, etc. [ed. note - don’t for get the Federal Reserve Bank] made this mess it is their problem not yours and mine. I know jobs are going to be lost over this (maybe lots of jobs) and that is what makes it a travesty (more on this later).
2. If you bought houses with cheap loans looking to “flip” them see above.
3. The homeowners: If you cannot afford the home the bank becomes the owner of said home and charges you rent as long as you maintain the home and you can live there until the home sells are you find more affordable accommodations. If the loan can be re-worked so that the current “owner” can make the payments. As long as either of these two groups of people cooperate fully their credit will not be negatively affected.
4. The only people that will get any government assistance are those low and fix income folks who were duped into refinancing their homes by unscrupulous lenders and mortgage brokers.
5. If you are/have been convicted of fraudulent lending practices involving sub-prime mortgages all of your assets will be seized and sold by the government to pay for this plan and your prosecution.  To some extent the plan would then become self sufficient.
6. If you lost your job at a business involved in mortgage lending if you can prove that you had no hand in making ill advised loans you can qualify for some assistance to be determined later but the burden of proof is on you.

I am sure there are some holes and flaws with this plan but this is all I could come up with while I was showering after jogging yesterday.  I am pretty sure this better and cheaper than anything the Federal government is going to come up with.

Unless you live under a rock you might have noticed that the pundits are saying that we are in a recession. Thanks to the crisis with sub-prime mortgages (let’s not forget rising oil prices and inflation) which leads to today’s rant…

I love having things as much as the next person. The nice house, flat panel TV, kayaks, cars, etc. all kick ass but I have never bitten off more that I can chew financially. I pay off the balance on the credit card every month I only try to have one car note at a time and try to pay cash for as much as I can. I even try to pay for vacations in advance! I am not trying to get on a high horse here because I have mis-managed my finances a time or two. The first thing I did with my first credit card was get a $300 cash advance so I could go see U2 in New Orleans and party all weekend (great long term investment strategy). Then I got two credit cards and decided to see how fast I could get both of them to their limits! At least at the time I was out of school and gainfully employed. I finally decided two things that I was ready to marry my girlfriend at the time [-ed. note: She did say yes (amazingly) and they are still married almost 10 years later (poor girl)] and that having all this credit card debt was stupid so I took out a loan big enough to cover the ring, my credit card debt, and a new washer and dryer. I put up my car for collateral and proceeded to get out of debt. I paid off the loan early and paid off some other debts we had amassed moving half way across the country. No one ever taught me how to manage my credit or curb my consumerism which is what got me into trouble and has lead to the mess we are in now.

Good credit score != wealth. I am not really sure what a good credit score does equal. Mine is on the low side of great while my wife’s is on the high side of great to excellent but she could not pay some of the loans she would qualify for but I could. I have always said you can live like Roger Clemens when you make as much money as he does and there is the problem. Most people want the big huge house, multiple hummers, exotic vacations, and the trappings of wealth and are willing to go deeply into debt for it. Which blows my mind. Some people will say that it is what keeps the economy running, well that is great in everything but some day the piper is going to want to get paid. Until then we are essentially shuffling IOUs around trying to figure out who actually is paying for lunch. The American consumer is not the only one that deserves blame here.

How in the world some of these mortgages ever got approved is beyond me. Well except that greed and consumerism make dangerous bed fellows. You had two groups of consumers fueling the fire the first group wanted to live in houses the could not afford the second group wanted to speculate themselves into wealth betting on real estate appreciation. For the most part neither of the groups had the means to pay for the real estate even under the best of circumstances. Then there are the bankers who kept approving these loans so they could package them up into different kinds of investments and sell them to other banks, hedge funds, and investment funds. The bankers were operating under the theory that only a certain (small) percentage of these loans would default and everyone would come out ahead. The math that they taught me in Catholic school tells me that if someone makes $60,000 a year they cannot afford a $300,000 house. But apparently most mortgage brokers did not go to Catholic schools or any schools where math was emphasized.

So here we sit with inflation, rising fuel costs, and a falling dollar. Hold on to your backside because it is going to be a rough ride. We will come out of this one too but there will be some casualties there always are and there will be some people that come out of this looking like geniuses (these would be the people that have the cash to buy up all the real estate and stocks that were over valued because they did not invest in the over valued piles of crap in the first place).