News of the finance

After two weeks in cold, grey London, the glorious Tuscan sunshine that welcomed me on arrival at Pisa airport felt like heaven. Shedding my scarf and jacket and for the first time in forever (OK, maybe two weeks) feeling the fresh air against bare skin, I was given a false sense of security that my whole stay in Italy would be like this, spent swilling wine in the glorious sunshine. However, as the other travellers I met later had warned me, the sun didn’t stick around for long.

The information desk staff at the Pisa airport were less than helpful (“Here’s a bus ticket, if you need a map, go over there”) and almost to spite them I just jumped on a city bus having no idea where it would take me. But the scenery was nice, so I stayed on,  until I found myself somewhere out of town, and I had to walk back to catch another bus back where I came from.  Then I had some trouble finding the hostel I wanted to stay at and there was some to-ing and fro-ing until I finally found what I was looking for.

No wonder I missed it – all that marked the entrance was a pair of monastery-style heavy steel doors with round knockers on them.  It looked like some kind of medieval castle or tomb. No signs, just a buzzer on the side wall. But my search certainly proved worthwhile. For 16 euros I got to to sleep in a beautiful, huge room with giant original 300-year-old stained-glass windows overlooking the Corso Italia, a charming little laneway street of cafes and shops. But my favourite thing about the Walking Street Hostel was the staff. The man at reception, Marco, was an entertaining Italian and within minutes of being there I had met his pet ferret and a few hours later I was accompanying him to the supermercato buying all sorts of goodies for the feast he was going to cook us tonight. Me, a fellow Aussie, an American and two Singaporeans sat around the table and enjoyed our homecooked feast of pasta, pane and vino as if we were a family sitting down to dinner. I don’t know any other place in the world that you can get service like that.

That night we wandered about the town and found ourselves at the tower, that looked enchantingly beautiful and eerie in the pale blue light.

The next day Megan arrived via train from France. We were unable to contact each other by phone because neither of them were working but I went down to the stazione to see if I could find her,  lo and behold, we bumped right into each other. We to0k our cheesy photos at the tower and decided 15 euros was a bit steep (excuse the pun) for the climb up it, so we enjoyed some pasta for lunch (just for something different) and got hassled by an old bearded busker who seemed intent on following us back to Melbourne.

After another feast of pasta from the hostel staff, that night a storm hit Pisa so hard I thought our hostel was going to split in half. It felt like the thunder was rumbling right underneath us.  It poured down all night – I half expected the town to be flooded when I woke up.  With umbrella in tow (the first time I have used my travel umbrella the whole trip, can you believe it?), we jumped on a train to Florence.

Florence was enchantingly beautiful. We saw the Santa Maria Del Fiore cathedral, gazed at the beautiful mosaic gold ceiling of the baptistery, marvelled at the sculptures at Piazza Della Signoria,  got my hand grabbed from behind by a mime who made me scream in front of everyone in the piazza, saw Boticelli’s Birth of Venus along with a million other mythological and religious paintings at Uffizi gallery, walked to Ponte Vecchio … then I lost Megan and there were a few hours there during which I didn’t know where she was and started to worry and dropped my phone and broke it until she rocked up at the hostel door.

We went to our favourite cafe around the corner from the hostel (we’d also been there for lunch) where the food and wine was cheap, the staff friendly and atmosphere lively. I questioned the owner about a tip. “Tip? You come back tomorrow – that’s our tip,” he said.

On Saturday we queued up for about 40 minutes in the rain to see the Statue of David at the Galleria Dell’Accademia. I think both Megan and I fell in love with David a little bit. He really is something to behold. Of course there are other great things to see in the gallery, especially the room of 15th century sculptures (though there was one curious one – a “boot”, consisting of two bits of wood, roughly painted; we wondered if it was there as a joke) but really, it was all about David.

We dragged our cold wet feet to Piazzale Michelangelo which bestowed stunning views over Florence: even in the rain and drizzle, the city was misty and beautiful.

Dinner that night was an ordeal. We headed out at 8.30-9pm (this is the time Italians eat, restaurants don’t generally open until after in search of a place called Mario’s. We walked and walked, foolishly without a map, and couldn’t find it until we stumbled upon a place called Trattoria Marione which was jam-packed with people and had massive crowds queuing out the front. Absolutely famished, we gave up after a 40-minute wait in the rain, and walked and walked some more, when I had a very confronting run-in with a drunk Italian man. As Megan and I were passing him and his friend, he called out, “Ragazza Americana!” (assuming I was an American girl) and he grabbed me very abruptly around the waist. My first thought was the offended “I’m not American”, and I struggled to get away from him but then I realised that this guy wasn’t going to let me go and his hands were wandering to places I didn’t want them to go. I’d say he held onto me for a good seven to eight seconds and by this stage Megan was getting very agitated. After fearing I was about get kidnapped we finally got rid of the guy and from then on as I walked down the narrow streets, I eyed each passer-by with distrust.

So now I was starving and pissed off, and anyone who knows me knows this is not a good combination. We ended up dining at a restaurant that was way too expensive for what it was because we were so desperate for nourishment.

Our night then took another turn when we tried to make our way to a nightclub to meet a fellow backpacker we’d first met in Pisa. On the way to this bar, called Twice, we were joined by a gelati vendor and his friend, and upon arrival we found the place was rather seedy and played pretty crappy music. Its only value was people watching. A few guys we met were heading to Babylon, so we went along, and this is where the fun really started. The sauna-temperature club was packed wall to wall, people were smoking inside, the dancefloor was madness, there were three to four DJs in costume being delivered bundles of vodka bottles over the crowd’s heads, joined by a bunch of men dancing in their underwear and some pretty flamboyant man-on-man PDA. Bottles of spirits were being poured into girls’ mouths and every 10 minutes or so the bar staff or DJs would release the contents of a bottle of champagne onto an unrelenting crowd. Megan and I just looked at each other, wondering what we had just walked into. Additionally the bar staff were so wasted that we didn’t have to pay for drinks. A side of Florence I never expected to see.

Sunday was our ultimate disaster day (warning: some venting ahead). Day 3 in Italia and my UK credit card still wasn’t working. I would like to use all sorts of colourful language to express how much I HATE banks, especially Barclays, but I won’t, because I’m sure everyone’s heard it before. Anyway, because this bank is run by a bunch of half-wits, I am required to register online each country I am travelling to and the arrival and departure dates for each one, to prevent fraud. To hell with fraud. Because of course, silly old me assumed my internationally-recognised VISA card would work anywhere and I ended up in a  foreign country with no cash and when I tried to call my bank to fix this, I used up the whole credit of my international calling card to sit on hold for 45 minutes because not a single Barclays customer service operator seemed to be working that day.  Thank God for my sister, otherwise I would have been totally screwed. She was able to spot me but there was still 45 minutes of my life I wanted back and a few extra wrinkles I could’ve done without. Thanks Barclays. Oh and my Australian bank wasn’t much better; I had waited two and a half weeks in London for my replacement debit card that never came. Anyway, during this stressful time I further stuffed my phone by accidentally stepping on the screen, so now I can’t read texts properly. Wow, I rock.

/vent over

So we left Florence much later than planned, waited for a train to Siena, and then we realised we’d forgotten to validate our tickets, and when the train inspector pulled us up about this, he demanded we pay 40 euros each in fines. We argued with him for a little while and almost got kicked off the train, but ended up paying him 5 euros each which would’ve gone straight to his pocket.

Siena was so worth it – pure Tuscany. It was one of the only Italian towns spared from bombing in World War II, so it was this untouched, dreamy Medieval town that makes you feel as if you have stepped inside an oil painting or on a movie set.

It wasn’t so tranquil when we first arrived though. When we hopped off the bus we saw crowds and crowds of people hanging off every available section of fence between the buildings, all watching something intently. We went over for a peek and discovered it was a football (soccer) match in the centre of town. Milan v Siena. “Do you know if one of the teams scored a goal just before?” a group of tourists asked us. I said we didn’t know, but I don’t know how these guys could’ve been confused. We only witnessed it once: but when a goal was scored, you knew about it. Grown men were leaping at each other, kissing each other, almost crying, people were screaming, things were thrown in the air – even flares were being let off – and Megan and I just watched in amazement as chaos erupted around us. In stark contrast, when we wandered into town, Siena was completely deadly still because everyone was at the match. We then wandered into the piazza and saw the absolutely breathtaking Duomo but missed visiting hours by a few minutes, which we really regretted because the photos of the interior looked simply stunning. We shook off a strange man that accompanied us for a short walk around town who claimed to be a prince, and made it back to the piazza for dinner, until it started t0 fill up with football hooligans (the match was obviously over). We jumped on a train out of there – same train, yet headed for very different destinies. Megan was heading to Chiusi in the Umbrian countryside to volunteer on a farm for two weeks, and I was going to Rome, to see basilicas, temples and museums.

The BoC meets tomorrow and will almost certainly increase interest rates. Even with all of this recent juice, Vancouver prices have flattened and likely already begun their descent. Some kind of extreme has been hit, and the rate hikes will add to downward pressures. Our estimation is that, over the next two years, prices will likely correct by >33%. Thereafter we will grind lower, and the eventual trough will represent >50% off current prices. -vreaa

This excerpted from ‘Mortgage debt surges as economy picks up steam’, G&M 31 May 2010 -

“Canada’s economy is on fire, surging 6.1 per cent in the first quarter at an annualized pace.”

“A Statistics Canada report also shows personal debts rising, as mortgage growth surged $76.4-billion annualized in the first quarter from $59.8-billion per cent in the fourth quarter of last year. People are using more credit for homes, but less for other items.”

“Household debt as a percentage of personal income probably rose to a record 148 per cent.”

Stocks in Europe, Canada and Brazil advanced along with oil as investors speculated the global economy will withstand the debt crisis in the euro zone. Spanish government bonds fell after Fitch Ratings stripped the nation of its AAA rating, and shares fell in Israel.
Global trade volumes in the first three months of this year were 5.3 percent higher than in the previous quarter, representing slightly slower growth than in recent months but still a healthy rebound from the crisis, data from the Dutch CPB institute showed on Monday.
The CPB, whose data are used by the European Commission and World Bank, said world trade in the three months ended February had grown by 5.8 percent over the previous three months and grown 6.0 percent in the last quarter of 2009.

Trade growth remained strongest in Asia and Latin America, but was relatively low in the euro area, it said in its latest monthly world trade monitor.

On the more volatile monthly figures, world trade volumes were 3.5 percent higher in March than in February, when they grew 1.7 percent.

Trade volumes grew worldwide except for Japanese imports, and both imports and exports in the euro area were strong.

World trade in March was 4 percent below the peak reached in April 2008 and 21 percent above the trough seen in May 2009.
Apple Inc (AAPL.O) said it sold 2 million iPads since launching the touch-screen tablet in the United States nearly two months ago and taking it to nine international markets this past weekend.
The company did not give a geographic breakdown of sales in its statement, but had previously said it sold 1 million iPads in the first month after the U.S. launch on April 3 — passing that milestone faster than the iPhone.

Fans mobbed Apple’s overseas stores on Friday when the iPad went on sale in Australia, Canada, France, Germany, Italy, Japan, Spain, Switzerland and the United Kingdom.

Apple delayed the international launch by a month as it had difficulty meeting demand for the device, which has received high marks for videos and games, reading electronic books and magazines, and general Web browsing.

Apple said the iPad will be shipped to nine more countries in July, and to more markets later in the year.

RBC Capital Markets has estimated iPad’s total shipments to reach 8.13 million units worldwide by the end of the year — which would translate into at least $4 billion (2.75 billion pounds) of revenue

New entrepreneurs, on the cusp of starting their own businesses, generally fall into two categories:

1. People with no idea what to do, but the urge to try something new
2. People with a brilliant/hare-brained idea, but no idea how to execute it

In the second category are a fabulous breed of people: the hobbyists. Turning a hobby into a business is a wonderful idea because:

• It’s something you already love doing, so you won’t get bored
• Startup costs are comparatively low (unless your hobby is something like ‘live space exploration’) because it’s something people already do for fun. You probably own lots of kit and raw materials already
• It’s something that other people are interested in too- and that means there’s probably a defined market, in fact there’s often a thriving community with its own magazine, events etc.
• If you already work, it’s the sort of business you can kick off in the evenings and in your spare time without prejudicing your work or income- and you won’t feel too knackered because you’re doing something you enjoy.
• And if you completely mess up, chances are you won’t feel like you wasted your time.

My friend Sue makes glorious intricate dolls’ houses- originally this was a hobby; now it’s something of a kitchen table business as Americans in particular love historically accurate miniatures. Renata, meanwhile, makes jewellery from beads, and now teaches her skills at monthly sessions. eBay businesses are also a classic hobby business – I recently met a lady who specialises in the import and sale of (specifically) Dutch clocks. Another friend decided that other people might like the same sort of dresses that she likes, and so has started selling them.

All these businesses are about starting small, spending very little upfront, taking low risks and seeing what happens. One of the thrills of eBay, for example, is that there’s basically very little risk at all: pop something up for sale and the world is your shop window for a few quid.

So, what are the downsides? Well,

• Banks are still cruelly resistant to kitchen-table businesses. I use the word ‘cruelly’ because I do think this is unfair. Hobby businesses generally don’t ask for big dangerous loans; in fact they’re often the model of cost-conscious entrepreneurship. I think that banks often like to class hobby business owners as ‘unreliable amateurs’ when what they really mean is ‘people who will be perfectly happy without making banks rich by buying unnecessary financial products’. In other words, hobby businesses are actually very prudent. They deserve to be taken more seriously.
• Occasionally, passion can cloud your business judgement. Hobbyists are often terrible at accounting for their own time, particularly in crafts and design businesses. If it takes you twenty hours to fashion an authentic medieval crossbow, you need to charge for those twenty hours and all the materials- even if you enjoyed every second of making it.
• And the biggest disaster of all… it can stop being fun. Once your hobby becomes a job (which is especially a risk when you become a finance director, marketing director and sales manager as well as the person making the product), it can suddenly lose its idyllic lustre. You need to keep the fun alive by sticking to your roots and expanding only at your own pace.

If you have a hobby which you would like to turn into a business, here are my simple top tips:

• Start small, stay small. Most hobby businesses fall over when they try to scale up. Unless you really do want to become MegaCorp, take some income for yourself and your family, and be happy with that!
• Keep an eagle eye on your costs. In business, money is everything. If you don’t cover the cost of your raw materials and the time you put in, you are guaranteed to make a loss.
• Use your network. You know lots of people- many of whom will be into the same hobby as you are. They are your ideal customers.
• Don’t ditch your day job unless you’re convinced you can make a go of it full-time.
• And definitely don’t ditch your day job unless you’re convinced it will still be fun in a year’s time.

Finance Minister Jim Flaherty said Thursday he will bring in regulations to prevent banks from linking to insurance products from their online banking websites.

Finance Minister Jim Flaherty asked banks to stop linking to insurance products from their online banking pages last year, but not all banks responded.(Canadian Press)

Flaherty has told the banks they can promote insurance on corporate website pages that are not used for internet banking.

“We intend to prevent banks from using their web pages to promote non-authorized insurance products, which is not permitted in their branches,” Flaherty said in a statement on the Finance Department website.

The new regulations will not apply to insurance products that banks are allowed to sell at their branches, such as credit and travel-related insurance.

Banks are not allowed to sell insurance in their branches, but can do so by setting up separate outlets adjacent to those branches.

Flaherty asked banks on Oct. 7, 2009, to stop linking insurance products from their commercial websites, but not all did.

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