Crawling Road
Investing, economics, finance and random thoughts.
Investing, economics, finance and random thoughts.
Feb 10th
Why do people freak out so much when you tell them you own some gold in your portfolio? It’s as if you had just told them you killed a dozen people before lunch. The hyper-ventilation you hear from some when you even mention this topic is just nutty. It usually starts with some juvenile comment involving tinfoil hats. Then they pull out some quote from an economist (usually one that loves inflation to solve all problems) about how useless gold is. They may even hit you with the ol’ “gold is not a form of wealth but just a shiny metal” lecture (ignoring the bulk of human history, and all major central banks, that disagree with them). Then they tell you how “risky” gold is when their own portfolio may be loaded to the hilt with junk bonds, emerging market debt or other complicated investment products. They must think the Nigerian stocks they hold in their Frontier Market fund are a sure thing (assuming they even know what’s in the funds they own).
Well, I own gold and I admit it. I feel comfortable owning gold in my portfolio. I sleep well at night knowing I own gold even though it could drop in value. I understand that in a balanced portfolio gold is a useful tool. I trust gold to protect me in high inflation more than indexed linked bonds (TIPS) ever will.
Gold has no interest or dividends. I admit these things and acknowledge that this is one area that makes gold different than stocks and bonds. However, this does not make gold useless for diversification.
Gold maintains real purchasing power over time and it’s really good at doing this. No other asset on this planet has such a long history. I don’t worry about politicians printing trillions of dollars of gold. This is because politicians can’t print gold. Gold can also be owned directly without any obligations attached to it. These are unique attributes for an asset class when used properly in a portfolio (and properly does not mean 100% gold).
While gold does not have the interest or dividends of stocks and bonds, it has other benefits that can work at certain times to protect a portfolio that does hold stocks and bonds. Gold for instance does very well under high inflation when stocks and bonds do not.
Gold has risks just as stocks and bonds have risks. I understand what these risks are and how they fit in a diversified portfolio. Yet, I do not rely only on gold in a portfolio. I also own stocks and bonds to drive returns when gold is performing poorly. In diversification there is safety which is why I own all these assets and don’t get religious about it. I accept gold’s quirks because I know when it comes time for it to perform it will do so better than all its contemporaries.
The empirical evidence says that owning some gold in a portfolio is not the death sentence academic literature would suggest. In fact, at certain times having gold can be a tremendous help. So, either reality is wrong or the academic theories are. Given a choice between the two, I’ll take reality. That reality is that all portfolios should hold some gold for diversification against stocks and bonds despite what critics state. That’s why I own gold.
Feb 9th
I’m often asked questions about substituting some asset X for one of the other assets in the Permanent Portfolio. I think this is a bad idea because you could introduce a potentially weaker investment for one of the time-tested assets the portfolio holds.
Now, as a recap we know that the Permanent Portfolio holds four core assets:
1) Stocks in an inexpensive broadly based index fund like the Total Stock Market Wilshire 5000 or Russell 3000
2) US Treasury Long Term Bonds
3) Cash in a US Treasury Money Market fund
4) Gold bullion
So why does the Permanent Portfolio hold these specific assets? Why not some of the new stuff being sold by Wall Street each year? Or some of that other stuff being pawned off as the hottest new fad by some academic and the book they’ve written?
Well, this is primarily because the goal of the portfolio strategy is to grow money when it can and protect that money when it can’t. To do this, the Permanent Portfolio owns a variety of assets which are best in their class for each particular economic condition (prosperity, inflation, deflation and recession) and do not take any risks outside of the area they specialize in. These assets have proven themselves a number of times in the past to do exactly what they say they will do. This lessens the chance that you’ll be surprised by some unforeseen risk.
What is meant by this is that the portfolio holds stocks in a cheap and broadly diversified index fund free and clear with no margin (leverage). Broadly based stock index funds have an excellent track record compared to actively managed funds and do well when prosperity is driving the markets. This means you are only taking market risk with the stocks and not additional risks of being unable to service your margin loan forcing you to liquidate your portfolio for a margin call in an emergency. Nor are you taking on risk that a stock fund manager may have you out of the market when there is a big rally going on forcing you to miss the gains.
For bonds we are taking on interest rate risk by owning long term Treasuries. However we are not taking on credit and call risk present in other bonds. This means if a deflation situation hits we can profit from the rise in Treasury prices but not have to be concerned with the resulting bad economy that could cause non-Treasury bonds to default. Neither do we need to worry about the low interest rates that could make bond issuers recall their bonds and sell new ones that are cheaper for them. It also means that during times of prosperity we have a nice steady income stream from the bond interest to add to our stock gains.
For our cash we hold only a Treasury Market Fund because they also have no credit risk. But they also eliminate needing to rely on FDIC insurance limits and liquidity issues that could affect non-Treasury securities and money market funds as we experienced in 2008. You will always be able to access your cash if you own Treasury bills in a money market fund because they are the most liquid paper investment on the planet. You never have to worry about a non-Treasury money market fund freezing redemptions because they broke the buck due to their bad investment decisions (also happened in 2008). Nor do you need to worry about your bank going under and wondering how long it will take FDIC to clean up the mess and allow depositors to access their money.
Finally we have gold which can suffer malaise during times of a good market but is the most powerful asset you could possibly own during a period of bad inflation. Gold also functions as an ultimate insurance policy in case something truly awful were to happen to the US Dollar.
These assets were chosen for specific performance reasons because they tend to combine in a way where risks in one are cancelled out by benefits of another. Interest rate risk in bonds are cancelled out by the inflation performance of gold. Gold price declines are cancelled out by stock and bond price gains. Stock market losses can be countered by gold or bond price increases. Etc. Risks are taken where they should be taken and avoided where they should be avoided.
When you substitute a lesser quality asset for one of the rock stars the portfolio already owns you can seriously damage the diversification potential in unpredictable ways. So my advice is to leave the core portfolio alone. The only real exception to this are for foreign users of the portfolio strategy who should be holding their cash, bonds and probably more stock in their home country to be sure their portfolio is in sync with their local economic climate and not tied so close to the US and US dollar.
If you want to add other assets then you can do it by holding them in your variable portfolio for money you can afford to lose. But I think changing around the core assets is not a good idea.
At this point we have about 40 years of data showing the strategy has been working. A full thirty years of that data is actual empirical evidence. This is because this portfolio strategy was conceived in the late 1970s with only minor tweaks into the 1980s and largely unchanged since. The worst loss the portfolio had was about -4-6% in 1981. There are no guarantees going forward of course because the past does not predict the future, but the portfolio theory works as designed so far and has a really solid record of performance and safety. So why do you want to go in and mess around with something that has been shown to work in good markets, inflationary markets, deflationary markets and everything in between?
I say if it ain’t broke, don’t fix it. Keep it simple.
Feb 6th
Investing should be dead simple. Dead simple investing means sticking to the basics. This post I’m going back to the basics to help new followers of the Permanent Portfolio get a solid understanding of how the strategy works.
First, I recommend you listen to all of Harry Browne’s investment radio shows. Yes, there are a few dozen of them and it may take some time. But, if you are deciding on this investment strategy for your life savings isn’t it worth it to know all you can about it? I would hope so. I’d also hope you’d think the same thing for any strategy you choose to follow. These shows answer perhaps 99% of any basic question you may have and many you probably never even considered. The shows are an easy to understand course on investing and economics all in one package and you will learn a great deal by listening to them — promise:
Along with the shows above, I also recommend you download the e-book version of Harry Browne’s last investing book Fail-Safe Investing. The e-book is about $10 and is a concise work of Browne’s 40+ years of investment experience and advice. This book is a short read and very easy to understand. It encapsulates Harry Browne’s very simple asset allocation strategy which actually is derived from a very sophisticated understanding of economics. His approach offers a level of diversification and safety not seen in any asset allocation approach I’ve ever run across (and I’ve seen a bunch of them):
If you want a physical book, then you can pick one up below. It is the same as the e-book mostly. However, the e-book is more up to date. In the e-book he recommends using an index fund for your stock exposure and avoiding all active funds as may have been mentioned in the hard copy version which was published in 1998 along with his earlier books:
Fail-Safe Investing Hardcopy Book
Next up you have Browne’s 16 Golden Rules of Financial Safety. If you follow these rules religiously, along with the Permanent Portfolio allocation, you will have a tough time losing your life savings:
16 Golden Rules of Financial Safety
Still want more? You may want to read these articles that I wrote which talk about some more core concepts.
The Permanent Portfolio Allocation
Permanent Portfolio Historical Returns
Between Browne’s radio shows, books and the extra information I wrote you’ll have a thorough understanding of this approach to investing so you can make an educated decision if it is right for you.
If that’s still not enough then you can read articles with the “permanent portfolio” tag on this site:
Permanent Portfolio Tagged Articles
Between the radio shows, Browne’s books and the FAQs you will know just about all there is to be known about implementing the Permanent Portfolio strategy. These basics will provide a solid foundation to grow and protect your money.
Feb 1st
Like most nerds, I like having some type of pocket tool kit on my person at all times. Whether a Swiss Army Knife or Leatherman, it comes in handy so often that I just can’t imagine traveling anywhere without one. But suppose you have to disassemble your car or defuse a bomb MacGuyver style in total darkness? You need some light and you need the light detached from your tool kit so you can see what you’re doing while using the tool itself.
For many years I carried a Photon squeeze light on my knife. While very light and handy, they just didn’t put out a very strong beam and when the batteries died there never seemed to be any spare button cells around. Even worse, my Photon light would often turn on when in my pocket ensuring the battery would be dead just when I needed it. Eventually I decided it was time for an upgrade and and wanted a newer high output LED light using more conventional AAA batteries. After some research, I ordered a Fenix LD01
flashlight.
The LD01 features a powerful 80 Lumens output on the highest setting. The light output is easily as strong as a much larger conventional lightbulb flashlight. I’ve lit up objects 100+ feet away without any problem. On the lowest setting the light is comparable to the squeeze lights but the beam is better focused and more usable thanks to the built in reflector. There is also a medium setting which is a nice compromise in brightness vs. battery life. The light settings are quickly adjusted by turning the front bezel. When turned on initially it will default to medium power, the second twist gives you low power and the last twist gives you high power. Twisting a final time turns the light off. There are no buttons on the light and the entire system is controlled by twisting the head. This is also how you replace the battery. It’s a rugged and simple design and stays off when in your pocket and stays on when you want it to be on. The kit also includes a pocket clip, attachment ring and spare O-ring in case the included one wears out.
In terms of battery life, on the highest setting the manufacturer claims a one hour burn time with a single AAA battery, 3.5 hours on the medium setting and 11 hours on the lowest setting. I’ve not run a battery out yet despite having used mine for many hours already. Because the light uses a standard AAA battery, you can find replacements in stores that may not stock button batteries or specialty photo cells that other lights may use.
The light itself is about 3″ long and 1/2″ in diameter. Here it is in comparison with a standard sqeeze light, the little brother Fenix E01 light (not nearly as bright but much cheaper), and my trusty Swiss Army Knife:
I had some photos of just how strong this light is, but honestly the images just can’t capture it well and it is so bright that it was causing the camera to underexpose.
Let’s just say that a full size 3 D-Cell traditional bulb flashlight is about 80 lumens and weights over 30 oz. This light that fits in your pocket and weighs perhaps two ounces is just as bright. Of course there are some lights that are brighter, but for the size this one is really hard to beat. I own several Fenix lights now and have never had one fail me after some pretty rough use (as opposed to some others which failed soon after I bought them).
The little brother Fenix E01 is about 1/3rd the price, but is not nearly as bright even though they both use the same AAA battery. It also has only one brightness setting. It’s a great little light for the $10 or so it costs, but if you want a pocket light that means business I recommend just getting LD01. However, the smaller version could be a great light to keep around the house for power outages or other tasks that don’t require a blinding amount of output. They’re also cheap enough to keep one in your glove box in your car as a backup in case you needed to change a tire, etc. at night.
The orange thing on the knife is a Swedish Firesteel Mini which is a small sparking device for starting fires, lighting stoves, etc. I keep it attached to my knife on a six inch piece of cord so I can strike it with my knife blade to throw sparks if needed. Usually I’ll use it when hiking to start up my stove and also as a backup firestarter in case of an emergency.
But back to the flashlight. Fenix is a relatively new manufacturer, but they are making some really good products and the LD01 is a great piece of kit. It puts out an amazing amount of light in a small package that fits in your pocket. I think it’s a great value for the quality and function and can easily replace much bigger units for a fraction of the weight.
Jan 28th
A theme you’ll hear on this blog about investing is the idea that the markets are not predictable. You may believe that I’m referring to the idea that you can’t predict returns on investments ahead of time and that’s partially true. The other part though relates to extreme risks that sweep through the markets in unpredictable ways with unpredictable results.
Aside from standard market risks, when you look at your investments it’s also important to always ask yourself: “What if I’m wrong?” Because, odds are, you will be wrong eventually. It’s just a question of degrees on how wrong it will be: A little or a lot.
The Permanent Portfolio has protection against unpredictable market risks and being wrong. If you’re wrong, you’re not going to be wrong so much that you take a crushing blow to your portfolio (because your asset allocation is widely diversified in relatively small chunks). We should also understand though that all investments have risk. Without risk, you will not get rewards. So risk must be taken to grow a portfolio, but it must be done with specific goals in mind. We need profits, but we also need defenses against an unknown future.
In this light, I’d like to share with you some books and podcasts that I think really hit at this problem of risk, uncertain futures and protecting yourself against being wrong. They may help you understand why diversifying and eliminating unnecessary risks in your portfolio is so important and why being wrong does not have to be fatal if you handle it correctly.
First there is John Allen Paulos and his book A Mathematician Plays The Stock Market. This 2003 title is one of a series of excellent books written about his worldly observations as a mathematician. In this case, the book details his own personal story of losing money in the stock market and how uncertainty rules. It’s an interesting look at many concepts you see in the investing world with respect to stocks vs. bonds, efficient market hypothesis, chaos theory, etc. And, best of all, it’s a very easy and fun read with almost no math but high level explanations of many concepts with real-world examples. He has a number of books written in his “A Mathematician” series exploring everything from innumeracy in society to his experiences investing (and losing) lots of money in Worldcom as he discusses in this book. The bottom line is that risk is real, markets are random, and trying to beat it can be very costly. His dedication reads:
To my father, who never played the market and knew little about probability, yet understood one of the prime lessons of both. “Uncertainty,” he would say, “is the only certainty there is, and knowing how to live with insecurity is the only security.”
John Allen Paulos – A Mathematician Plays the Stock Market Dedication
Now that’s a dedication I can get behind! That is the core philosophy of how the Permanent Portfolio is designed to operate.
Next, there is Nassim Nicholas Taleb and his series of books on chance. First there was Fooled By Randomness followed by The Black Swan. Both of these books explore the idea of unpredictability in the world. While his advice is largely being linked to finance today (he was a former trader), his observations come into play in many areas of life. His book, The Black Swan, pre-dated the 2008 crash involving Fannie Mae but said this in one of his footnotes:…the government-sponsored institution Fannie Mae, when I look at their risks, seems to be sitting on a barrel of dynamite, vulnerable to the slightest hiccup. But not to worry: their large staff of scientists deemed these events “unlikely.”
Nassim Taleb – The Black Swan Pg. 225
I’d say he certainly called that one correctly.
I also think you’ll enjoy these two podcasts from Nassim Taleb. One recorded in 2007 talks about his book The Black Swan. The second was recorded in 2009 after the market meltdown as an after-action report on what he had written and said before:
Taleb on Black Swans – April 30, 2007
Taleb on the Financial Crisis – March 23, 2009
One thing about Taleb is while he has disdain for most fields of economics (and especially the very silly Keynesians), he does have an affinity for the Austrian Economic School and their dislike of the over-application of mathematics in economics for what is, essentially, a human behavioral problem (aka. scientism). Why does this matter? For one, you cannot model risks accurately with standard statistical methods because human behavior is not predictable. Secondly, Harry Browne was a firm believer in Austrian Economics and the Permanent Portfolio design, at its absolute core, is based on the Austrian School’s theory on monetary cycles (a lengthy topic for another day) and embracing unpredictability in the world. In fact, I think that one of the reasons the Permanent Portfolio is good at dealing with market risk is because the Austrian Economics school is right about a great many things. This outlook helps to drive the portfolio down the right path over time avoiding serious pitfalls and dangerous assumptions about the future.
With these three books and two podcasts you will understand more about market risk than most professional investors and economists. Seriously. Combine that with Harry Browne’s podcasts, and his own previous books, and you’ll be well versed in the dangers of the unpredictable in the investing world and how to position yourself to deal with them.
Jan 25th
I just saw an ad on TV talking about TDAmeritrade’s new options trading tool. They had some hipster guy walking in with a bag full of groceries in his hand. He was very serious and lecturing about the need for strategy in trading. They then cut away to some other beautiful people talking about keeping up with the market first thing in the morning and watching some blinky lights on the computer monitor giving them information.
One lady looked intensely at a “heat map” that showed where the money was going that day. I thought she was playing Tetris but the commercial says this is part of the trading strategy. It looked more like a video slot machine, which I suppose it actually is in some respects, but it certainly wasn’t investing.
Well, it was just too much to bear so I took a quick look at what other pretty charts their software can make from their website above.
The “Heat Map” feature. Here you can see where the hot money for the day is going in the market so you can be the chump jumping in after everyone else and be left holding the bag:
This chart is a representation of your money being sucked down a black hole by doing options trading:
The website says: “See a clearer picture of the potential profit or loss of your options trades.” Is this chart clear to you:
Here’s a chart they left out:
That’s my projected returns on $100 for most options traders.
If the information in TDAmeritrade’s “heat map” and other technical indicators was worth anything, why would they be telling it to you? Why wouldn’t they use their secret insight into the markets and make a killing themselves? They’ll just have to be happy with their per-trade commissions while their options trading customers are pulling down the big bucks. I guess they’re just being nice guys.
I know people who lost their life savings trading options. Stay far away from this stuff.
Jan 21st
The previous book review of The Modern Survival Manual: Surviving the Economic Collapse covered the insider’s view of the Argentina financial crisis of 2001 and what happens when a society sees their currency lose more than 2/3rds of its value in a short period. It was an interesting read with unique insights into economics and sociology that you just won’t find in a standard textbook on the subject.
Now, I’m impartial to investment assets and don’t believe in extremes. I had some questions along the lines of going to extremes in investments and wrote to FerFal (Fernando – author of the book above) about his views having lived in a time when extremes did happen in his country. He gives his thoughts below.
On extremes in investing in gold (100% gold vs. not owning any gold) and real estate:
Extremes are bad, and I know what you mean. There’s people that believe anything other than gold is worthless and others that state “When the world ends I’ll trade an egg for a bar of gold!” You can only roll your eyes and think ok buddy, you sit there waiting for doomsday while I live in the real world.
I’ve noticed that both my father and grandmother have one thing in common. Grandma was a farmer in Spain, when she came to Argentina she started a successful bakery shop, lost their savings several times for many reasons, inflation, change of currencies, takeovers, etc.
My father is an accountant, he worked in banks most of his life, was on the board of directors of bank Boston in Boston, Massachusetts, practically lost the money he had to put into his retirement fund in Argentina.
The thing they both have in common? After a number of economic changes, inflation and corralitos of various kinds, the only thing both of them have left were their real estate investments. Those survived better than money in the bank, and unlike the almost useless retirement plans, the rent will be what really allows them to retire and live well.
Thought it was worth mentioning. I consider real estate an important part of one’s portfolio as well.
FerFal brings up a point that I hope to explore more in the future. I believe strongly that investors should have what a poster at the Bogleheads forum “chicagobear” aptly called a “have money” and a “make money” side of their portfolio.
Inside the Permanent Portfolio you have four assets: Stocks, Bonds, Cash and Gold. Stocks and bonds are your “make money” portfolio as they pay interest, dividends and have capital appreciation. Cash and gold are more of your “have money” portfolio because they pay little in interest (such as cash) or have no interest or dividends like gold (but may have capital appreciation). However these “have money” assets have tremendous ability to ride out very bad markets when your “make money” assets are doing poorly. The “make money” and “have money” halves of the portfolio work together to lower volatility and provide good returns.
But FerFal brings up another interesting asset: Real estate. It combines the aspects of “make money” by giving you an income stream from rent but also is a “have money” as it is an asset that can’t be inflated away easily.
For the Permanent Portfolio, Harry Browne cautioned against using real estate as an investment as he considered it speculative in nature. In many respects this is true. However if you own rental property you do have potential to make money if you choose a good location, have good renters, can manage maintenance costs, have a good management company, etc. This is the speculative risk part. It could work out, but there is risk that one or more things could happen to make it not profitable.
What about Real Estate Investment Trusts (REITs)? You get the high income streams from owning real estate, but don’t get the calls at 3AM in the morning about a leaking roof. REIT index funds own a wide variety of companies that have exposure to malls, office buildings, public storage companies, etc. So you get geographic and industry diversification as well. However, by owning stock you don’t own the actual property itself which may defeat the purpose of real estate entirely as a hard asset like gold. Yet, for investors that want to have some real estate exposure, but don’t want the hassle, it may be an acceptable trade off.
As it is, in terms of “make money” and “have money” side of things, real estate seems to straddle the fence. It combines elements of stocks and gold investing (along with both of their risks). It is a hybrid asset. If owned directly it can provide inflation insurance that stocks and bonds may not. Yet it can also provide an income stream that gold and cash cannot. With REITs you give up the direct ownership, but they do provide a nice income stream which is hard to ignore.
Are there risks? Of course. There are risks involved just as you’d suspect and they need to be managed effectively. For instance, property management seems like one of the biggest headaches for real estate investors (but not for REIT owners). In Argentina FerFal handles it this way:
About managing real estate, I’ve found that in most cases its better to spend a couple bucks each month and let a real estate agency collect the rent and argue with the people you rent to.
In few cases, you find the right person and things run smoothly, most often it doesn’t and a middle man like the real estate agency collecting rent and making the calls if they get behind saves you time and lots of headaches. Besides, they [the renters] pay better ( pay when they are supposed to) when they dont have the actual owner in front of them to cry to.
Never heard of owning real estate through stocks [REITs]. Here, most people manage their own property, with a real estate office always taking care of the contract ( very important to have a good contract) and some have real estate managers like the ones I mentioned.
Here its important to be good at haggling like I say in the book. I’ve had very serious, suit wearing real estate agents cut down their managing asking fees down to 10% of what they where originally asking for. It’s important to know the market, know what a realistic asking fee is.I’m a nice guy and dont like pushing people ( people that come up with excuses for not paying rent) but like everything else, you learn little by little, know when someone really just needs a couple more days, or when he’s playing with you. Again, best thing is to have someone else take care of it, specially if you’re not planning on having much time to chase people around to get paid.
Here in the states many rental property owners do use management companies and this does seem to lessen the stress. They manage the renters, the maintenance, etc. There are some potential pitfalls to navigate though (such as the management company overcharging you for services and maintenance, carrying insurance, etc.). So rental property ownership is far from a sure thing and will take some work on your part to choose wisely.
However if you think you have the stomach for it, rental properties may be a consideration if you’re looking to have exposure to hard assets but also want that asset to deliver an income stream. BTW. I don’t think time shares fall into this category. I think time shares are the kind of investment made to be sold, not bought. Also, when we’re talking about owning real estate I feel we’re talking about property where you own the note yourself and not taking out loans to buy properties and risk you can’t make the payments. Taking out large loans to buy property other than your own home is a violation of Rule #7 of the 16 Golden Rules of Financial Safety.
If you don’t want to deal with any of these risks, or don’t have funds to buy additional real estate outside of your home, it may make more sense to look into a REIT fund like Vanguard’s REIT index (Ticker: VGSIX) or the iShares Realty Majors Index (Ticker: ICF). If you are eligible, the TIAA-CREF Real Estate Fund has an excellent reputation as well. These options provide inexpensive exposure to real estate with the trade off being you don’t own the property itself. If you are comfortable with that, the REIT funds above provide an easy way to get real estate exposure. They also have the other advantage that they are very liquid. Meaning that you can sell them in 60 seconds to get your funds instead of waiting days, weeks, months or even years to unload a physical property plus realtor commissions.
In terms of asset allocation, real estate is in the variable portfolio side of the house. Basically, only do it with money you can afford to lose. Also realize that if you own a broadly based stock index fund like the Total Stock Market you already own REITs. You just don’t own a lot of them in proportion to everything else.
Also remember that real estate does have risk just as all investments do. It’s just a question of diversifying these risks against all your other assets to reduce losses if they should show up. REIT funds dropped over 65% from their 2007 highs to their lows in 2008 as a recent example. And despite what realtors always claim about physical property prices, many areas experienced significant price drops in real estate that could take years, or decades, to recover. Yet, with the real estate bubble clearly popped in the US this asset could be a reasonable buy for someone looking to diversify a little of their play money and have some protection against unexpected events as well.
Thank you Fernando for answering my questions. Please be sure to visit his blog where he provides information on many topics.