607 Credit Swap and the Kitchen Set

607 Credit Swap and the Kitchen Set

Schlomo Tzedaka, the last Bronx Jew is sitting in his kitchen with the proverbial sugar cube in his cheek and the glass of tea on the table before him. The chrome legs on the Formica top table have further deteriorated. And none of the vinyl seat chairs is now without scar. "I'm going to get a new kitchen set," he tells a visitor. "As soon as I can get a credit swap for it." A credit default swap for a kitchen set? "Well, these things aren't cheap, you know. Maybe $400 or even five."

He's asked about his credit card. "That's for suckers," he says. "I'm going out and trading my fixed rate loan for a variable. Rates are so low, I can't lose." You have a loan? "Well, yeah, doesn't everyone? Mine's for $145.00 from one bank and $280 from another. A regular consortium. That's how I got my big screen flet panel TV." (Flet? Every once in awhile the Yiddish comes through. Not often.)

"So, I'm paying it off, but the rate's high and I want lower. I'm going to do a credit swap."

This seems a little complicated for buying a TV and a kitchen set.

"Nah," he says, "I got the best deal I could. But I'm on Social Security and things are tight. So I move money around. I end up paying nothing."

This makes no sense.

"If it's good enough for Wall Street, and if it's good enough for city hall, it's good enough for me."

He's reminded that Wall Street and the city work in billions, and he's talking about $500 give or take.

"Dummy! Is the city ever out of money? Do they ever pay any of it back?"

He has a point.

He's done some kind of figuring that will let him pay off his TV loan with the kitchen set loan and come away with a TV, a kitchen set and -- somehow -- the next month's rent and end up paying next to no real dollars.

"Moving money around, kid. That's the secret. Never spend anything of your own and you'll be fine."

He's reminded that he's neither Wall Street nor the city and eventually, someone's going to want a payment in actual currency.

"I'm an old man. I like TV. I want a prettier kitchen set, one without ripped seats and rusting legs. I'm an old man. Let my heirs worry about it."

But you HAVE no heirs.

"Exactly."

Shrapnel:

--Correction: The shrapnel in this spot originally identified a hotel peeping tom as an FBI agent. He is not.

--The fall colors around here are pretty nice this year. The woods in back of the house are green and red and yellow and brown. and they glow beautifully in the midday sun.

--Waiting for Google Docs to come up with a macro system. Not fully necessary. But after typing the sign-off line below 607 times and having to "insert" the "special characters, ® and © separately, it's getting tiresome or I'm getting even lazier.

I'm Wes Richards. My opinions are my own, but you're welcome to them.®

©WJR 2009