Hump Day Wednesday, February 15, 2012, Rhinelander, Wisconsin, USA
We have been long real estate in about all forms since way back in the mid-1970s, when thanks to a small inheritance, we bought our first home, in Tempe, Arizona. Thankfully we have always made "major money" in almost every real estate transaction we ever made, although this sometime took years. In fact it was the relatively quick "flips" that we profited the least. So, obviously, at least for us, real estate should be considered a long-term investment, and we aren't only referring to the homes we live in and other properties that we actually use.
About a month ago we mentioned the Louisianna Purchase, and speaking of absolutely fabulous long-term real estate investments, that has to go down as one of the greatest of all time. Leaving the shores of the U.S. our representatives, Monroe and Livingston, sailed for Paris, in 1803, with the approval of Thomas Jefferson to buy the City of New Orleans from French leader Napoleon Bonapart for as much as $10 million. But, despite pleadings from most of Napoleon's fellow Frenchmen, he decided to sell much more than just New Orleans. Indeed, the French, for just $5 million more dollars (including the cancellation of some debt), threw-in all or part of 15 current U.S. states, including small pieces of what is now Alberta and Saskatchewan! All the way from Louisiana's booming New Orleans up to the Dakotas, Wyoming, Montana and Colorado, including much of current day Arkansas, Missouri, Iowa, Oklahoma, Kansas, Nebraska and Minnesota. Holy Toledo! No, sorry Ohio wasn't in on the purchase, but for about $220 million of today's U.S. dollars, a vast section of the mid-section of our nation was all bought, about 23% or our land, from the French - in one-fell-swoop.
There is actually no way we can even begin to estimate the current value of the Louisana Purchase, but in spite of the question of it's Constitutionality, and the fact that Monroe and Livingston were told to only give up the debt and another 8 to 10 million, they decided, thankfully, on their own, that the deal was too good to pass up. It isn't often that we give thanks to the French, but this is one case that we have to tip-our-hats to them. It was, oddly enough, President Thomas Jefferson and at the White House, who first had "potatoes served in a French manner," and that is the other thing we have to thank the French for - their fries. Now we only wish they, and the rest of Europe, would straighten-out their finances.
"Leave no authority existing not responsible to the people." -- Thomas Jefferson
Friday is the monthly expiration - make sure any ITMs (In-the-Moneys) on your Activity and Positions page are dealt with. We will be at the Trader's Expo in New York next week, so our daily missives might not be posted in their usual manner.
(* = FHW position)