Double Blind

It is once again time to make some predictions for what will happen in 2010. My crystal ball has always been very cloudy on these sorts of issues, mainly because I like sticking my neck out and making very narrow-ranged predictions is a good way of guaranteeing they will fail. Some of my predictions will be recycled from 2009.

For the scorekeepers, here were the predictions I made for 2009, and the results of them.

I will rank each prediction with my perceived risk factor, with an index of: (e) = easy, (m) = medium, and (h) = high.

Politics
1. (e) Stephen Harper will be Prime Minister on December 31, 2010.
2. (m) Canadians will vote in a general federal election between July 1 to December 31, 2010.
3. (e) The Green Party will still have zero elected seats (floor crossers excluded) in the Canadian House of Commons in December 2010.
4. (m) Election or no election, Justin Trudeau will mobilize for the Liberal party leadership in such a way that becomes “obvious” that he is interested in the position. His primary competitor, Bob Rae, will be doing the same (and already is; this prediction is that it will be “obvious”).
5. (m) Barack Obama’s approval rating will be 40% or less sometime in the first half of 2010. In the second half of 2010 his approval rating will not make new lows compared to the first half of 2010.
6. (m) In the United Kingdom 2010 election, the Conservative Party will get a majority government, but there will be a surprisingly high result of non-Labour and non-Conservative candidates that have credible chances of winning seats in Parliament. Right now there are 99 seats held by non-Labour and non-Conservative members, and this will increase in the upcoming election.

Vancouver 2010 Olympics
7. (m) After the closing ceremonies, the Vancouver 2010 Olympics are considered by the media to be “successful”, but not the groundbreaking exhibition that Expo 86 was for the Vancouver region; news trickles over the subsequent months post-Olympics about scandals concerning payouts, contracts, and guarantees to be claimed and picked up on the tab of the BC taxpayer. Benefits that were pitched with respect to BC tourism, minus the influx of media, IOC big-wigs and athletes’ families, will turn out to be much less than touted.
8. (m) Despite fears that the Sea-to-Sky highway will be jammed, due to stringent controls, nothing of significance will occur here other than some weather-related (snow/ice on the road) crashes. Finding a place to park in Whistler, Squamish and Pemberton will be a nightmare.
9. (m) The roads leading to the Arthur Laing Bridge and Cambie Street north of 49th Avenue will be gummed up with more traffic, but other than this, it shouldn’t be any different in Vancouver. The Lion’s Gate Bridge will also have more traffic volume, but since traffic on the bridge is already a disaster people won’t notice the difference.
10. (e) No terrorist incidents at the Vancouver 2010 Olympics.
11. (e) Main and East Hastings of 2009 will look like the Main and East Hastings of February 2010. Oppenheimer Park will still be the preferred place to hang out for the day if you’re homeless. I will make it a point to walk around the area east of Gastown to verify this!
12. (e) Unfortunately, I must predict the Canadian men’s hockey team will not win the gold medal.
13. (m) The Canadian women’s hockey team will win the gold medal.
14. (e) Canada will win more than 7 gold medals (which was their gold count in 2006), and more than 24 total.
15. (m) Gordon Campbell will not step down in 2010, nor will he make an announcement or even a hint as such.

Economics / Geopolitical
16. (m) Median condominium (apartment) sale prices in the Greater Vancouver area will peak in 2010 in the month of March or April and be less in November 2010 than in March 2010, using the statistics at REBGV.
17. (h) The BC government will increase the threshold of the first-time homebuyers’ exemption to the Property Transfer Tax from $425,000 to $500,000 during its 2010 budget.
18. (m) Economic growth in China will continue to be “insanely high”, which we will define as 6% or higher.
19. (m) The US dollar will end the year stronger than the Euro.
20. (m) The US government will not get any “geopolitical concession” from a foreign country. I know this prediction is vague, but the essence of this prediction is that the US is perceived to be weak-kneed and will not use its military other than in politically correct contexts (e.g. sending troops to Afghanistan).
21. (m) The S&P 500’s high for the year will be reached in April-May 2010.
22. (m) As measured by corporate earnings via income tax collections, 2010 will be a much, much better year than 2009.
23. (m) GST collections will also be up from 2009 levels in 2010.
24. (m) The $45.3 billion dollar deficit for the 2010-2011 fiscal year, as projected in September 2009, will be considered to be a high estimate (i.e. for the March 2010 budget, the estimated deficit will be less than $45.3 billion).
25. (m) Spot oil (light crude) will end 2010 between CAD$70-90/barrel. However, it will hit CAD$120 at some point in the year.
26. (h) Spot gold will slip below CAD$950/Oz at some point in 2010.
27. (m) The Bank of Canada target overnight rate will end the year at 1.25% (more likely) or 1.5% (less likely, but possible).
28. (e) The US Federal Reserve’s interest rate for 2010 year-end will be 0.5% or less.
29. (m) The market rate for a five-year fixed rate mortgage will be between 4.75% to 5.50% in December 2010.

Culture
30. (m) The Vancouver Canucks will not make the playoffs.
31. (m) Facebook will file form S-1 with the SEC (first step in going public).
32. (e) Twitter will not file form S-1.
33. (e) Google will still dominate Bing in the search engine space.
34. (m) By the end of 2010, you will be able to find a cell phone plan in Canada that will have 200 minutes, unlimited evening and weekends, caller ID and voicemail for $25/mo (before sales tax). Competition in the mobile data market will have “obviously intensified”.
35. (h) Global warming (climate change) will no longer be the primary environmental focus by year’s end.
36. (h) There will be a “better public awareness” of consequences to automobiles (e.g. automobile fuel pump failures, lessened fuel efficiency) due to the government-mandated mixing of increased levels of ethanol and biofuels in conventional gasoline.
37. (h) Tiger Woods will win at least one major golf championship (this is one of: The Masters, US Open, British Open, PGA Championship).
38. (m) Microsoft Windows XP usage will still have an above 50% penetration rate, according to W3School’s statistical survey and other comparable sources (e.g. via Wikipedia). Windows Vista will be less than 15%.
39. (h) The phrase “Social Networking” will have peaked in 2009, according to Google Trends (picture here).

The December 25, 2009 attempted terrorist bombing of Northwest Flight 253 was the shock story to end the year. Once again, Wikipedia, by far and away, continues to be the best news aggregation on major issues. Instead of having to fish around for bits and pieces of information, it consolidates it all in one nice summary page. Since the situation was fluid, some of the information that is single-sourced will have to be taken with the unreliability associated with such events, but as long as one knows the information is not truly reliable, it is better than nothing.

I take particular interest in this issue mainly because I already had a flight booked to a US destination coming up early next month and want to know how much chaos and havoc will occur. From what I can tell, things were messy in the first couple days following the incident (holiday traffic combined with time-consuming passenger security methods). Scanning the YVR departures pages today (December 28), despite having a computer system glitch heavily affecting check-ins in the morning, flights mostly appear to be going off on-time with a few delayed half an hour here and there – typical for a Canadian winter.

It is my contention that incidences like these will continue to cripple the air travel system by making incremental costs (both monetary and time) increase to the point where people’s marginal travel decisions will either go through other modes of transportation, or not at all. The costs are not due to security perception – most people believe that air travel is reasonably secure, but the cost is due to the hassle that one has to incur in order to travel by airplane. Hearing announcements such as “line-ups of 3 hours to check-in” is a very real cost of peoples’ time.

It was clear that the terrorist involved got onto the airplane screwed up in his mission quite badly – one wonders why he didn’t try detonating his device in the bathroom of the airplane. I am guessing that there would have been some training exercises done as a proof of concept of the technique he tried to employ, but for whatever reason (e.g. under the pressure of the situation) he failed to properly detonate his device. My guess is that the chemical formulation that he used was not pure enough to get enough of the PETN that he was using to ignite – there is a chemistry required to make sure that the whole explosive goes up at once, rather than bit-by-bit. It could also have been the case that he was sweating so much that there was too much moisture in the device at the time.

I think the passenger that stopped the terrorist in question did the whole flight a favour, but I doubt that he saved the airplane – if that device went off properly, we’d still be wondering what the heck happened, like Air France Flight 447, which disappeared in the middle of the Atlantic Ocean.

The knee-jerk security measures implemented (security directive linked here) (restriction to one carry-on, and restricting the seating of passengers to doing nothing but twiddling their thumbs in the last hour of flight) is not going to solve matters that lead to this situation. There were multiple failures in the security system – the largest one being how somebody can get onto an airplane with 80 grams of military explosives while getting through security. Both restrictions will do nothing to rectify this particular situation – if explosives are already beyond the “sterile area” of security, restricting passengers’ actions within the airplane cabin will mitigate little. Finally, if you a terrorist that knows this procedure, you will simply do your business one hour and 15 minutes in advance of the flight landing, instead of 45 minutes before.

The two times that I had a thorough airport security examination performed on me (one was in YVR, the other in Florida and both were seemingly random), the agents examined my carry-on baggage, and also gave me a physical body search by patting down my entire body thoroughly. Around the crotch area (which they courteously announced before going at it) they slid the outside-facing part of their hand against the area between my gonads and my hip joint (once for the left and right side), and above my gonads. This part of the process took about one and a half seconds. Most relevantly, there was no testicular “check”. The importance of this is that below the testicles and inside the rectal area (and between the buttocks) are obvious locations to pack powered explosives in specially sewn underwear. I did not find the check to be ‘intrusive’ – media tends to sensationalize stories of passengers embarrassed to be touched close to certain parts, but there was absolutely nothing sexual about the experience for me or the poor CATSA/TSA person performing it.

There are a few conclusions that I have come to.

One: It is clear that the only machines that have the ability to perform full body scans, with puffer jets to capture trace elements of most explosive solids, will be adequate in the future. Privacy will have to be tossed out the door, since the most logical location to put explosives is inside the body or very close to sensitive “untouchable” areas and such scanners will need to account for this – manual scanning by airport security agents will not be able to do this without it being considered very intrusive to passengers.

Two: Airport employees will likely be a point of failure in the future, as they will be able to interface between the “sterile” area after security and the airplanes themselves. Ensuring that this part of the ‘chain of custody’ is secure will be increasingly important.

Three: Electronic devices with their own power sources of any variety, especially lithium-ion batteries, will likely be banned from flights as they are an easy source of ignition. Such devices will likely have to be checked-in, which will bring up the risk of theft (see point number two above). It will not be sufficient to check in just batteries as a variety of electronic devices have built-in batteries and there is no way for a security agent to differentiate between an iPod vs. some clone with a detachable battery.

Security measures taken over the past decade incur a real cost to passengers – both money, and more importantly, their time. It eventually gets to the point where it is not worth subjecting ones’ self to the hassle of traveling by air unless if it is absolutely necessary. Before, it used to be economical (saving time for money) to fly to a destination if it was a four hour drive or further; now, that number is closer to six hours after you factor in all of the delays and inconveniences you have to encounter. With increased security measures, this will likely go up to 8 hours.

I will be writing about an economic solution to this increasing erosion to the effectiveness to the public airline system in a future post.

I started with week 7 last Monday, and the schedule said to run 10 minutes, walk 1, and repeat this until 5 kilometers of running has been achieved. Ignoring the distance obtained from walking, that works out to about 29 minutes of running at 6.6 miles per hour.

I got through the first ten minute part, but my right calf felt extremely tense, and was not able to make it through the next 10 minute run. I did not want to risk injury, so instead I just went back to walking slowly for a couple minutes, and went back up to running speed again, and then my calf got sore, so I slowed down again. After about half an hour on the treadmill, my calf felt better again while running, but it wasn’t a good session. I did not feel cardiovascularily challenged, but the lower part of my legs obviously were not sufficiently warmed up or stretched for the warmup period. At a minimum in the future, I will stretch for half a minute on each calf before going into my pre-run walk routine.

As a result of failing to do this week’s regimen to the letter, I will be repeating it again next week.

Today’s (Wednesday’s) session was supposed to be a run 4 minutes, walk 1 minute session, repeated 6 times. I did this, and experienced similar soreness in my right calf (despite stretching beforehand), but it wasn’t nearly as bad as the previous session. I also did a modification of my running step, where I took more frequent steps and this seemed to alleviate the problems that I was having. In fact, in the last run, I decided to go for ten minutes straight just to see how much energy I had – and I did make it.

I think this issue with my calf can be resolved with proper stretching and a proper warmup routine, perhaps longer than the five minutes of walking that the Learn To Run 10k program suggests.

Complicating the matters somewhat is that I have not skipped a training session since I started in early November. Unfortunately my next scheduled session is on December 25, 2009. This means that the gym will be closed and I will consider running outside in what will likely be nearly freezing weather, albeit sunny. I recall during the first year that I trained for the Sun Run (2005), I did everything outside, whether it was raining, sunny or dark!

Statistics Canada released population statistics for the third quarter of 2009.

BC’s population grew from an estimated 4,455,207 in July 1, 2009 to 4,479,934 in October 1, 2009. This is an increase of approximately 24,700 people. The January 1, 2009 estimate was 4,419,974 people, so the net for the first nine months of the year is approximately 60,000 people.

If this is proportionate to the rest of the country, about 32% of this is through births minus deaths; while 68% is through net immigration.

Out of the 68% coming in through immigration, I would hazard to guess that the vast majority (>90%) of these people are coming into the Greater Vancouver region, so that means that there are roughly 40,000 more people living in the big city today than there were three months ago. Assuming half the migrants that come in are already joining families, this would suggest that about 20,000 individual dwellings are required to house these immigrants.

I don’t know the socioeconomic status of the immigrants coming into Vancouver; if they are relatively affluent (which is not the majority of immigrants coming into the country) then it might explain the condominium market.

It’s nearing the end of the year, and it is accountability time for the predictions I made back in 2009. I do not anticipate things changing materially between now and the end of the year, so I will issue my report card. These predictions are made purely for entertainment purposes only and while I would look like a clairvoyant genius if I got it all right, it would be purely attributable to luck.

On with the predictions! Remember, at the time I made them (December 2008), I ranked them as (e) = easy, (m) = medium, and (h) = high in terms of risk.

1. (e) Stephen Harper will be Prime Minister on December 31, 2009.

Success. Harper is a brilliant Prime Minister and will be sticking around for many more years. When the public looks around and asks themselves whether they want Harper, Ignatieff, Layton, Duceppe or May to be in the top seat in the country, the choice is obvious.

2. (m) Barack Obama will have an approval rating of less than 40% on December 31, 2009.

Slight failure. The current Rasmussen Report (December 22, 2009) has him at 44%. 44% was a lot lower than what most pundits were willing to predict for the end of 2008, but Obama’s slide in popularity has not surprised me. He inherited a raw hand economically, but despite having huge majorities in the House and Senate, he has been jerked around like a pinball by his own party that isn’t listening to him.

3. (m) Canada’s projected deficit for 2009-2010 (when accounting for actual fiscal performance as judged by the October Fiscal Montior) will be -$30 billion, plus or minus 10%. (i.e. the cumulative deficit from April 2009 to October 2009 will be -17.5 billion).

Failure. The projected deficit is around $57 billion. Corporate tax revenue decreases, combined with excise tax (mainly GST) decreases and the stimulus spending package put this number at a record high. Without the stimulus package, the number would be around $30 billion.

4. (h) Canada will repeal legislation to tax income trust distributions.

Failure. A high-risk prediction that obviously did not occur. There will be a lot of trusts gobbled up in late 2010 and 2011 as the tax shield goes away. Unfortunately, the markets for fixed-income products are quite high and I wouldn’t touch most of them.

5. (h) The yield on a 30-year US treasury bond be below 3% by December 31, 2009.

Big failure. The yield now is around 4.6%.

6. (m) The Canada-US dollar exchange rate will decline (i.e. US dollar will strengthen, CAD will weaken) from January 1 to December 31 (currently 0.8227 as I write this).

Big failure. It is around 94-95 cents on the dollar at the moment.

7. (m) The S&P 500 will close December 31, 2009 at 825, plus or minus 10%.

Big failure. I am so glad I haven’t put any money on these macro predictions, the S&P 500 is around 1100 at the time of this writing.

8. (m) Oil will end the year at US$35/barrel, plus or minus 15%.

Big failure. It is around US$70/barrel, meaning I am massively off.

9. (m) Median condominium sale price in the Greater Vancouver area will decline 18-23% from December 2008 to December 2009.

Big failure. According to the MLSLink housing price index, the average Vancouver “apartment” sold for $333,275 in December 2008, while it sold for $381,945 in November 2009. This is a whopping 14.6% increase.

10. (e) GM or Ford will recapitalize, regardless of any ‘bailout’. (i.e. this will involve the conversion of debt to equity in a bankruptcy or prepackaged arrangement, significantly diluting existing shareholders).

Success. GM recapitalized. Their shareholders got wiped out, although if you were an old shareholder of GM, you can still dump your stock in the in-bankruptcy GM entity, a.k.a. Motors Liquidation Company, for 50 cents currently. I have no idea who the heck is putting a bid on that, they are literally throwing money away.

11. (m) Q4-2009 real GDP will be lower than Q4-2008 real GDP.

Success. Although the Q4-2009 numbers are not out yet, it is very likely, given what we have seen out of Q3-2009 that it will be the case, although by a slimmer margin than I anticipated.

12. (h) At least one Latin American country will go through some sort of ’significant revolution’ by years’ end.

Tough to judge. Honduras has some crisis regarding the president of the country wanting to go beyond his constitutionally mandated term limit, but there wasn’t a “revolution” per se, just a military coup.

13. (h) A nuclear emission will occur in the atmosphere by years’ end. This could be due to either a nuclear meltdown or atmospheric nuclear weapon detonation.

Failure. This is fortunate. I was thinking and still am thinking we will see either some nuclear conflict in the Israel-Iran theater, or some old school nuclear plants in the former USSR which will have safety deficiencies.

14. (m) The USA will not incur a terrorist attack directly resulting in the deaths of more than 5 individuals.

Success.

15. (m) The new Star Trek movie will “suck”. Let’s define “suck” as “not as bad as Star Trek 5, but in or around Star Trek 3, or the last three next generation Star Trek movies”.

Failure. There are $384,953,778 reasons why this prediction failed. Cinematically, it was better than the last three “next generation” movies, but by just a touch. I hope the sequel has a little more substance in the plot. I reviewed the movie here.

16. (e) Canucks will actually make the playoffs this year…
17. (h) … but {the Canucks will} lose in the second round of the playoffs.

Success, and success. Our local team never fails to disappoint the fans of Vancouver, year in and year out.

18. (e) Bittorrent networks, despite bandwidth throttling, packet shaping and other measures by ISPs, will continue to thrive.

Success.

19. (e) By the end of 2009, you still will not be able to find a cell phone plan in Canada that will have 200 minutes, unlimited evening and weekends, caller ID and voicemail for $25/mo. Data rates for mobile phones will still be “ridiculously expensive”.

Success. This might change in 2010, however!

20. (m) Facebook will be somewhat marginalized by the end of 2009; this is sort of analogous to what happened to Myspace in 2006 – i.e. it will still be a significant service, but not the “wonder darling” of the tech industry it used to be.

Slight failure. I’m not sure “marginalized” would be the right word to use for 2009.

21. (e) Facebook and Twitter will not go public.

Success. I can now see Facebook going public in 2010 (primarily so they can liquidate like crazy before their business goes belly-up) but I don’t see Twitter going public.

22. (m) Global warming (climate change) will no longer be the primary environmental focus by year’s end.

Failure. Cophenhagen, anybody?

Summary (out of 22):

Successful predictions: 9
Failed predictions: 12 (5 “big” failures, 2 “slight” failures)
Ambiguous: 1

A lot of my failures were macro market predictions, which should never be taken seriously since so many variables change on the fly during the year. Fortunately that did not translate into lack of investment performance.

Stay tuned for the predictions of 2010 which will be posted here hopefully by years’ end, or early 2010.

A very quick review of Wordpress 2.9; it feels faster and more refined. It didn’t break anything, so if you’re running 2.8.6, just click on the upgrade and it will be seamless.

I tend to write when I’m interested in writing thoughts – the content flows quite naturally out of my fingertips, I hit “publish”, and that’s the end of it.

One of the consequences of writing this way is that when I am “forced” to write, whatever comes out is usually of lesser quality.

Very often I have thoughts while showering, driving the car and especially at the grocery store, but I fail to transcribe them correctly onto the internet when I get to the computer. I then hit the “delete” button and consider it a lost echo of thought, just like all of the little bits of consciousness that we lose each day.

Just like Anthony, I don’t write for traffic. However, our routines are different in that he apparently has an ability to build on draft posts over time, while I tend to spew out everything at once. There are sparingly few posts that I keep in the draft folder, and even when I do pull them out, I notice my interest in finishing them has diminished considerably. I do not have a regular routine that results in posting content, although I find I am a little more prolific when I have my morning french-press coffee!

I also don’t write with the internet switch turned off. I am pretty good at continuing my train of thought when having my concentration broken (e.g. boiling water kettle starts whistling, nature calls, etc.) and continuing on with the post at hand until hitting the “publish” button.

Just as an example, what stimulated this post was reading Anthony’s post, and mentally comparing our different posting styles was worthy of a post. I’m not even at a location where I would otherwise post content, but I had the time to spend the 10 minutes it took to crank out this post.

Finally, I am quite bad at reviewing my own work before hitting the publish button – afterward, I usually re-read my post and make some minor revisions. This post was no exception, having four revisions after cranking it out the window.

This is continued from Newfoundland and Labrador, Part 2, a trip taken in early July, 2009.

The next part of the trip was to explore Labrador. There was no particular reason to explore Labrador, other than to say that I have been there, and the fact that it is rather to explore a part of Canada that not many people get around to. It is probably a great location to move to and live in if you have a fixed income and want to get away from everybody and start writing books – only one airline, Air Labrador, services the area. Most of the decline in the fishing industry has especially hit this area of Canada very hard – which is why most of the remaining population that are not retirement age is either involved in forestry or mining. A lot of people have left to the Alberta oilfields.

The ferry ride is roughly the same distance and duration to Labrador as it is from Tsawwassen to Victoria; the ferry ride costs less than half in Newfoundland ($30.25 vs. $72 for a car and two passengers). Makes you wonder if they are offering this under cost, or whether BC Ferries is gouging passengers out in BC. The ship itself was likely constructed in the 60’s or even 50’s – it clearly had much better days in its past. The ocean was also quite wavy and and the ship swayed back and forth – like swimming in a wave pool.

The ferry arrives in the province of Quebec – Blanc-Sablon, and the Newfoundland-Labrador border is very close to the east. It is always a strange feeling seeing all the signage in French, and in different font and colours. The main road goes east and for the most part, hugs the coastline. Once crossing the border, everything is miraculously back in English again. To cause more confusion, there is also a time zone change between the Quebec and Labrador side of the border.

One doesn’t have to drive too far east before reaching Newfoundland and Labrador again – there is a gigantic sign. It was also quite foggy and cold – not something you ordinarily would be feeling in July. There were also icebergs visible at certain spots along the journey. The buildings in the two or three towns along the way to Red Bay were very similar in construction to the western side of Newfoundland.

One item of note was that the mosquitoes outside the town areas were absolutely horrible – when taking a picture of one of the icebergs, it took five minutes to swat all of the mosquitoes out of the way. Fortunately they seemed to be dumber than the mosquitoes here in BC (by virtue of the fact that they were easy to swat), but they were still as annoying as mosquitoes get.

Making our way to Red Bay, this was a former whaling site occupied by the Basque for the purposes of harvesting whales. Inside the Red Bay historical site, there was quite an impressive reconstruction of a whaling vessel. Also, something even more impressive was the self-guided “field trip”, where you pay some person two bucks to get a boat ride across the water to Saddle Island, where they have an archaeological trail of what was going on. This was well worth it and was a great way to spend a couple hours – bring a lunch if you ever do this.

The only restaurant available for eating anything for dinner apparently was in L’Anse-au-Loup, although you’d never guess it by driving by. It also doubled as a bakery and a hotel.

For the night, we stayed at a Bed and Breakfast in L’Anse Amour. It is not too difficult to find, considering that the population of the town was 9 people. The host at the B&B (an elderly lady who is still very active) was very friendly, and also her daughter (who joined us for breakfast), who was a social worker. One of the many stories of that location was that a British warship ran aground near L’Anse Amour (around the World War 2 time), and the town mobilized and rescued sailors. In appreciation of this, the Captain gave the piano on board (which they managed to salvage) to the host of the B&B. Modern amenities, such as electricity, came relatively late to this area of Canada.

The next day, we visited the lighthouse at L’Anse Amour, which is the tallest in Newfoundland and Labrador. You can climb the many steps in the lighthouse and on the very top there was a huge Fresnel lens, and a very nice view of the surrounding area. Upon returning to ground level, there were some humpback whales that were off-shore. The pictures I took were less than stellar, but it was evidence of whales offshore!

Making it back to the ferry terminal, there was a lineup of about 20 people and one teller that was selling tickets. The lineup took forever to get through, and I thought we were going to miss the morning ferry, but fortunately we made it on board for a wavy journey back to Newfoundland, which will be Part 4 of this series.

Coraline is a computer animated film, about a pre-teen girl that moves into a new town with her parents, into a house that is inhabited by something with magical abilities… without giving away too much of the plot, she soon discovers that life in the alternative world is not what she initially anticipated.

I have no idea whether this movie was marketed to children or not, but there was a huge amount of tension at certain parts of the movies that it would be guaranteed to cause nightmares. Fortunately these scenes weren’t long but the designers of the movie did a good job of it – the main character had the correct amount of innocence and smarts to have the audience be able to feel for her, opposed to not caring what happens.

The tone of the movie was incredibly strange – I don’t know how much LSD the animators were taking when they did this movie, but whatever it was, it worked.

It’s worth spending the 1.5 hours to watching the movie, but the mood has to be right. This was probably the strangest animated movie that I have seen.

ING Direct raised their short term interest rates on savings from 1.05% to 1.2% on December 15th. While this is not a huge difference, it is interesting to note in light of the fact that there have been no underlying rate changes coming from the Bank of Canada.

My guess is that the competition, such as Ally (offering 2.00% on basic savings) is starting to encroach on their business. It is a trivial matter to setup an electronic funds transfer link to move short-term money to the highest savings account.

The other reason is that I suspect ING Direct is losing cash deposits from people that are starting to feel “comfortable” again in investing in other financial products, such as the stock market, gold, or real estate. The difference between 1.2% and 1.05% should make little difference to people.

I’ve personally allocated my own capital elsewhere. There are just too many superior alternatives to cash. This will change in 2010 – look out for headlines that start saying “cash is trash” and equivalent. Once you start seeing those sorts of headlines, it’ll probably be a good time to bunker down with a high bank account balance; 1.2% is better than a negative 25% return elsewhere.