Solar Companies Eye Upcoming Investment Tax Credit (ITC) Vote

September 23, 2008

Companies of all kinds in the solar industry are eyeing the upcoming vote for the investment tax credit (ITC) extension which would extend the 30% tax credit for solar developments and projects for 8 more years through 2016.  If the ITC is not renewed, the credit would decrease to 10% and many planned photovoltaic and solar thermal projects would be suspended or terminated.  One of note is the huge 280MW parabolic trough solar thermal plant in Arizona by Spanish solar company Abengoa.  Fred Morse, Abengoa´s US senior advisor, has already confirmed that Abengoa will not build the solar thermal plant on the proposed 3 acre site in Gila Bend, Arizona if the ITC is not extended.  This would be a major hit to the advancement of rewnewable energy advancement in the US, and many solar companies claim they will simply take their projects into other parts of the world where tax incentives are more favorable to the solar industry.

Look for solar stocks to fluctuate a lot up until this vote.  Since the tax credit expires at the end of the year, the longer the ITC renewal is delayed, the less likely something will get done.  Solar stocks will rocket up if the ITC is renewed and they will drop like a rock if it is not renewed.  Looking long term though into 2009, there is still a chance that the ITC will get renewed in some form after we have a new president in the US, and the government starts to realize that the US will not be a leader in solar technology if the tax credit is not renewed.  With energy prices being high, the US should make sure they are at the forefront of renewable energy; solar seems to have much less of a tarnished imagine compared to its sister renewable source, ethanol.


Death Spiral

September 17, 2008

What happens when a lot of money suddenly disappears and the banking system collapses? The answer my friend is the Great Depression. When the stock market crashed and banks failed, the economy went into a recession. The economy finally recovered when money was used to fund World War II. There are a few parallels to the current situation with the difference being that hopefully we have learned from history. FDIC insurance was created to add security, so that people can safely put their money in the bank without it disappearing if the bank collapsed. The banks failed, because everyone tried to withdraw money, decreasing the amount of money the banks had on hand to lend.

If we look at the timeline for the current crisis it starts with interest rates being lowered and lending rules being relaxed. This enabled people who otherwise would not be able to buy property to do so. When demand exceeds supply the prices go up. This lead to the appreciation of real estate values. Unfortunately those people could not afford to continue paying interest only loans at low interest rates. There is no such thing as a free lunch. People pocketed money on this bait and switch tactic, so they didn’t care. Since property appreciated, people also took equity loans against their property. This is when things started getting dangerous. This stack of cards was getting ready to fall. Once the Fed raised interest rates, people began defaulting. Banks started losing money, lots of money. In order to stay in business if you’re losing money is to loan money to continue paying your bills. If you can’t loan money to pay your bills, you have to go bankrupt. Most people go to the bank or some investment firm to loan money, but those people can only loan money if they have money to loan. The banks needed money and a lot of money, but they had no one to borrow it from. Now they are falling like dominoes.

This wouldn’t be so bad, but unemployment is also high. When people don’t have jobs, they can’t spend, so the economy suffers further. When the economy lags, people get laid off. This sends the economy spiraling downward. The only way out of this is the creation of new jobs by war or whatever. Hopefully whatever.

Middle Class at $250,000/year

September 15, 2008

Dan Gross’ Newsweek article about “Can you be middle-class and earn $250,000?” struck a chord. If I was Middle Class, I should be able to buy a home with a white picket fence and a car in the garage, right? The goal of a balanced society is to have income a wealth distributed on a bell shaped curve, where you have few very rich and very poor people with the bulk in the middle class. This middle class shall have the good life, whatever that means. Owning a home is strongly associated with being middle class. Being middle class sounds great. I want to be middle class too! In my quest to be middle class, I’ve been looking into what it takes to buy a home in the San Francisco Bay region. My conclusions paint a sad future for my quest into the middle class.

For starters, let’s look at the median salary of a freshly minted Stanford MBA , which is around $115k/year. That’s a reasonable amount. If computer science straight out of Berkeley can make $80k/year working in Silicon Valley, $100k/year for anybody else should be attainable. A person with educated from a top-tier school after a few years of experience should be able to put down $100k/year no problem. Now let’s look at taxes.

For Federal taxes, TurboTax Tax Estimator pegs it at about $20k for a single person, so you’re left with $80k.

California tax is about $7k, so you’re left with $73k.

Now let’s look at retirement. $5k for a ROTH IRA and $15k for a 401(k), so that’s $53k left. $53k is more than the median household income in 2007 of $50k.

The median price of a home in San Francisco ranges from $500k in a place that I would likely to get shot to a median price of $8M where Robin Williams lives. For any normal place it is around $900k. That’s almost $1M. The rest of the bay area isn’t that encouraging either. Oakland is about $500k or more in some areas with the lowest being $200k. Let’s take $1M as the price for a home since that is slightly above the middle and most people want to reach a little bit. Using INGDirect’s Mortgage solutions calculator, I find that I qualify for a $444,777 mortgage and a monthly payment of $2667, which leaves me about $500,000 short of owning a home. If I was married and made $200k as a household, I could qualify for $750,000, which is in the ball park of 25% downpayment, where 20% is considered the minimum for a Jumbo Loan.

For me to own a home in the bay area, I would need a partner that also makes at least $100k/year to bring our household to $200k/year. Is a home attainable? Yes, but not for a single person. Then again, does a single person really need to own a home?

NCL Norwegian Star Review: Alaska Cruise

September 4, 2008

In the last week of August, I embarked from Seattle on a 7 day cruise to Alaska with stops in Ketchikan, Juneau, Skagway, and Prince Rupert.  I choose to cruise with Norwegian Cruise Line (NCL) and on their 965 ft Norwegian Star ship, inaugurated in 2001.  This was my first cruise ever and I will do my best to outline the positives and negatives of the cruise.  From what I hear though, NCL is a more budget friendly cruise compared to Princess Cruises, Carnival, or  Holland America.

Overall Impression

NCL offered a cruise with plenty of hand sanitizer (at every elevator and entry to the main buffet) and plenty of activities for all ages.  Some of the various Norwegian Star activities included relaxing in one of six of their jacuzzis and main pool or making use of their fitness center, numerous bars, or onboard casino.  Pending weather you could venture outside and play dodgeball, basketball, take swings in the golf cage, or shuffleboard.   For the more sophisticated crowd, art auctions, reading a book in the library, NCL “university” lectures, or martini tasting are all available aboard the Star.  NCL also offered events for the entire family like a magic show by Murray, Chinese acrobats, dancing & singing entertainment by the Jean Ann Ryan Company, and comedy performance by Bud Andersen.

For this 7 day cruise, the first full day at sea and the last full day at sea were entirely travel days where you just find things to do on the cruise and eat your hearts out.  The weather was generally cloudy or sunny with a couple of rainy days.  Our captain manged to get us very close to the Dawes Glacier on our way to Skagway which provided some very nice photo opportunities of both the glacier and icebergs along the way.  We were also very fortunate to see a few humpback whales and orcas in the distance.

Even though you pay your basic cruise cost, taxes, port fee, and required tips, you also have a plethora of oportunities to spend even more money once you get on the cruise.  You actually don’t get your final bill until the end of the trip and everything seems to be billed to your room so they try to make you not think about how much you’re actually spending along the way.  You want soda with your dinner?  Additional cost.  How about a beer from the bar?  It’ll be added to your tab.  Buying gifts from the Galleria gift shop, onshore excursions, drinks from the bar (or any drinks you order in general), specialty restaurant charges, internet fees, and calls made from your room will all be tacked onto your final bill.  Photos are a big moneymaker for NCL as well.  They’ll take photos of your family as you board the ship, while you’re dining, with dolphin and otter mascots as you exit the ship, and they’ll print out the pictures for display in the photo gallery so you have the option of buying them for exorbitant prices.  There are a lot of free things on board, but I just want to stress that there are also a lot of things that do cost money.   Nothing is really free in this world anymore, especially cruise ships.


I booked my NCL cruise in October of 2007, when oil was only about $80/barrel.  Turns out that that time was the perfect time to go on a cruise because cruise prices have skyrocketed in parralel with the price of oil.

My trip:

Inside Midship 11th floor Stateroom (~143 sq ft) with Aug 23, 2008 departure date
Guest 1 and 2 (w/o port charge): $559/person
Guest 3 and 4 (w/o port charge): $209/person
Guest 1 and 2 government fees: $120.06/person
Guest 3 and 4 government fees: $116.06/person

Future reservation cost:

Inside Midship 11th floor Stateroom (~143 sq ft) with Aug 15, 2009 departure date
Guest 1 and 2 (w/o port charge): $949/person
Guest 3 and 4 (w/o port charge): $299/person
Guest 1 and 2 government fees: $177.75/person
Guest 3 and 4 government fees: $173.75/person
Fuel Surcharge for Guest 1 and 2: $77/person
Fuel Surcharge for Guest 3 and 4: $35/person

For the same exact type of room on the same level on the Norwegian Star, we’re looking at a $874.76 difference in price and that is for making a reservation now one year in advance.  What else is not included is the $140/person port charges that are collected by the cities that the Star docks at during the cruise.   Notice the fuel surcharge that now currently exists that did not exist when I made the reservation in October of 2007.


There were 4 primary free dining facilities on the Norwegian Star: Versailles, Aqua, Blue Lagoon, and Market Cafe.  Versailles and Aqua have the same exact menu and are the upscale free fine dining restaurants where you can have a five course meal and no be required for tipping.  Blue Lagoon is an eatery open almost 24 hours that serves typical American cafe type food like burgers and buffalo wings.  Market Cafe is the largest free buffet style eatery that allows every to dress casually and eat foods like roasted chicken, cesar salad, duck, french toast, fresh fruit, lightly battered cod, pancakes, and plenty of desserts.

Almost every day we would start with a hearty breakfast at Market Cafe at around 6AM.   For lunch or dinner, I would stress the importance of eating at Versailles or Aqua because they tend to have classier food and also at no cost.  You are encouraged to not wear jeans and semi casual clothes to these two eateries and are presented with a menu with options that I believe would cost $50/person if you went to a similar fine dining restaurant and ordered an appetizer, soup, entree, and dessert.  Especially early in the cruise, I believe some cruise passengers don’t understand that Versailles or Aqua are free and opt to eat at Market Cafe instead.

Below is an example of some of our meals at Versailles/Aqua:
Dinner (night 1):
Marinated Roasted Pineapple: aged rum, coconut cream, mint, mojito vinaigrette with sugar cane
Roast Leg of Lamb Provencal: white bean and mint ragout, rich wine sauce
Warm Vanilla Bean Souffle: grand marnier angiaise

Lunch (day 2):
Oyster Fritters: spicy aioli-chili sauce
Sweet and Sour Grouper: fried rice, prawn crackers
Warm Bread Pudding: dark rum angiaise

Dinner (day 2):
Grilled Asparagus and Marinated Bay Scallops: toasted sesame seeds, shiitake mushrooms, miso vinaigrette
Rudy Red Watermelon Salad: fried feta cheese, sumac-mint vinaigrette
Crispy Soyu Glazed Duck: cinnamon scented, star anise, dried orange peel
Honey Creme Brulee: layered semi-sweet chocolate ganache

Dinner (day 4):
Vietnamese Summer Roll: rice paper wrapped vegetables, sweet-chili dipping sauce
Chilled Avocado and Tomatillo Soup: cilantro marinated shrimp
Roasted Prime Rib of Beef: horseradish whipped potatoes, rosemary jus
Coconut Cream Pie: mango coulis

Dinner (day 5):
Sauteed Scallops: rice cake, cilantro, lemongrass, coconut milk
Chinese Duck Salad: chow mein noodles, coriander, sweet sauce
Cooking Light Baked Flounder: roasted asparagus, lemon-pepper, balsamic brown butter
Warm Strawberry Souffle: creme anglaise

Lunch (day 6):
Fruit Filled Pineapple: macadamia nut bread, passion fruit sauce
Crisp-fried Buffalo Chicken Wings: blue cheese dresssing
English Fish and Chips: malt vinegar, mushy peas
Strawberry Ice Cream

Dinner (day 7):
Tropical Fruits: mango and papaya, galliano liqueur
Nicoise Salad: tuna, black olives, green beans, herb vinaigrette
“Surf and More Turf”: lobster tail, shrimp, mussels, scallops, fillet of snapper tossed on a bed of linguini
Raspberry Sherbet

Lunch (day 8):
Chilled Cream of Apricots and Peaches
Grilled-seared Mahi-Mahi: crisp vegetables, papaya salsa
Chilled Coconut Rice Pudding: layered with semi-sweet chocolate ganache

Dinner (day 8):
Broiled Salmon Fillet: vegetable tagliatelle, caper butter
Warm Mango Souffle

By far the best entree was the “surf and more turf,” a splendid blend of seafood with perfectly cooked lobster, mussels, and scallops.  For you chocolate fiends out there, you will be glad to know your desire will be met during the one hour late night Chocloholic Buffet which allows you to have dozens of chocolate dessert options and grab as much as your heart desires.  It can be overwhelming how many options you have (even sugar free) so eat with caution.  I would see some people fill up a regular dinner plate completely and stacked a few inches high, only to throw away most of what they took.  What a waste.


On our particular cruise, we had a passenger capacity of 2600 people.  That is quite an impressive number but not as much as the 1200 employees on the ship.  That is almost a 2:1 employee to passenger ratio!  Most of the employees derive from countries outside the United States with about 550 employees hail from the Philippines.   Other countries include everywhere from South Africa to Jamaica to Peru.

I wondered “how are there so many Filipino workers on this cruise ship?” so I decided to ask some.  It turns out that there is an agency in the Philippines that flies out Filipino citizens to the United States to work for ten months of the year on these NCL cruise ships.  These Filipino workers sure aren’t on US work codes because these guys and gals work 10 hours/day for 7 days a week!  There are no requirements to tip these cruise workers either because NCL charges each passenger $10/day of mandatory tips (that I assume is the pay for these workers).  Let’s just say for simplicity that these 1200 cruise workers just split evenly the mandatory tips charged to all the passengers (probably not the case).

2600 passengers x 7 days x $10/person/day = $182000 in mandatory tips
$182000/1200 employees = $151.67 in tips distributed to every employee

I sure hope NCL pays these employees a base pay (minus deductions for food and lodging) plus these tip distributions because $151.67 is not something worth working 70 hours a week.  One of the Filipino waiters mentioned to us that he has worked for NCL for 9 years now so if someone is willing to work 10 months of a year on a ship for nine consecutive years, the payout must be very decent compared to what can be made in the Phillipines.

Location of the Room Matters

I would highly recommend getting a room as high on the ship as possible.  Rooms range from as low as the 4th deck to as high as the 11th deck.  I felt that the lower you go, the more rockiness you feel from the swaying ship.  In addition, the lower decks are going to have more noise coming from the engine of the ship.  I would also recommend getting a room as close to midship as possible.  The rooms toward the front (FWD) or back (AFT) tend to get more movement (I could tell when I’d eat at the 6th deck Versailles main restaurant toward the stern of the ship).


I know all these improvements might be unrealistic but some of these changes would make for a much more enjoyable Alaskan cruise experience:

– more reliable cameras to take photo IDs of passengers
As you go through the process of boarding the Norwegian Star, you go through a whole series of acquiring tags for suitcases, identification check, security check, etc.  At the counter during check in, NCL workers use a webcam to take a picture of your face for account and identification purposes while on the ship.  Seems like a simple process?  The next morning, we receive two letters on our door asking to retake the account identification photos because “it wasn’t a very clear photograph which means they can’t identify you.”  Therefore we had to go to the reception desk to retake photos of two our our family members.  This was not a huge problem, but a simple problem that could be avoided by getting a decent quality digital camera to be used during check in instead of some crummy webcam.

– digital clocks with some kind of decent back light in the rooms
They do have a clock but it’s integrated with the phone and it’s barely an inch in length so it takes quite a bit of effort to see the time.  This would be a nice feature because sometimes when you’re cramped into one of those staterooms, you want to know what time it is to ensure you aren’t late for any breakfast or onshore excursions.

– more time for onshore excurshions (especially Juneau)
Now I know that this might not be possible due to coordination of dock times with other cruise ships and destination traveling time between the various cities, but it would be nice to spend more than 6.5 hours in Juneau, the capital of Alaska.  6.5 hours might sound like a lot of time to spend in a city but when you participate in one of NCL’s onshore excursions, you have literally no time available to see downtown Juneau and do all the necessary sightseeing and shopping.   The distance between downtown and the cruise port location is also the farthest out of any of the city destinations on this cruise (about a 10 minute bus ride).

Good to Know Details

– In the extremely rare case that the cruise ship needs to be evacuated, there are enough lifeboats for all the passengers

– The workers who fix up your room do up to two rounds of cleaning the room.  The first cleaning happens during the day and is to change towels and bedsheets.  The second cleaning happens in the evening and is to primarily pull out additional beds and refix the bedding.  Amazing service!

– If I understand this correctly, you are only allowed to bring back 1 litre of duty free alcohol into the United States

Great Alcohol Deals

Alcohol purchases are duty free! Great deal for anyone trying to get some tax free alcohol purchases on top of the already discounted prices.  Four 1 litre bottles of Grey Goose (can pick of four varieties) for $100.  Four 1 litre bottles of Absolut for $40.  I had to bring back some Sheridan’s, coffee layed liqeur, for only $26/1 litre bottle.  From what I hear and read, you can’t purchase this in the United States and it tastes better than Bailey’s.   I bet there were plenty of other amazing alcohol deals but I don’t know enough about liquor to know what other deals existed.

To sum it up, it was a successful first cruise experience and I think seven days was just the right amount of days at seas.  I’m not so sure how I would feel about doing a 14 day cruise.  Days after returning to land, I am still feeling a bit of motion sickness from the cruise.  If financially possible, I would be interested in trying one of the other finer class cruise options in the future.  Great for families and the older crowd but maybe not the kind of environment the young adults would want from their honeymoon or anniversary.  In a future post, I will explore reviews of the NCL onshore excursions in all four cities I visited and detail what NCL won’t tell you in their summaries and if they are worth the money they charge.   So now that you have a comprehensive review, you can make like Tom and “cruise” outta here.

For additional information check out the shore excursion review here.