¡Hot Tamales!

It’s been awhile since we’ve had a bites and pieces post, so I thought I’d offer up our annual party for making tamales. The singular is tamal, but even my Costa Rica born wife calls it a tamale. I think I’ve corrupted her.

Tamales are traditionally made in Latin America over Christmas. There’s a lot of work involved, so a family will make an enormous batch, many of which are given to neighbors and friends. My wife’s parents owned a small bakery in Heredia, a suburb of San José. Tamales brought to them were often dinner at that time of year as they were swamped with seasonal work at the bakery. I’ve continued that tradition by bringing tamales to my neighborhood wine shop. They too are swamped this time of year and the tamales are gratefully received.

Making tamales is quite an undertaking. It helps to have some like minded friends and a general to take charge. I’ve done a lot more cooking over the last ten years than my wife, but I’d say she has more the makings of a chef than I. This year, she largely demonstrated how to make the tamales for our crew and kept the process going. I worked as a prep cook for most of the day.

The recipe for our tamales derives from one of Keen’s aunts, Lijia. At the heart of tamales is the masa–liquid thickened with corn flour. We use Maseca, which is corn flour with lime (calcium hydroxide, not fruit juice). The twist for Lijia’s tamales is to use boiled and mashed potatoes in the masa. You get a somewhat softer texture than using just corn flour. One cooks chicken breasts in a lot of water, add the mashed potatoes, some condimento and cilantro. Condimento is a spice blend that generally has garlic powder, cumin, and a few other spices. We make our own as it’s fresher and has less salt (or MSG) than that from the store. Plus, you can’t find Costa Rican style condimento here.

My sole contribution was to upgrade the chicken and the stock. The original version called for boiling the chicken breasts for a long time to create the broth, then add everything else. There’s two problems with that approach. First off, chicken breasts don’t have a lot of flavor to add to the broth. Second, what little flavor they have is long gone once you’re done making the broth. I poach the chicken breasts and then make a stock.

We start with a dozen skinless, boneless chicken breasts and four whole chickens. Remove the breasts from the whole chickens and add to the others. Rinse, pat dry, and set aside. Remove the dark meat from the bones and set aside. I freeze it and use it for other recipes, especially curries. Use a cleaver to break up the bones and expose that lovely marrow. Roast the bones along with the back and wings (also cut up into 3” chunks with a cleaver). Roast the bones for about an hour at 350 degrees.

While the bones are roasting, bring a stockpot with two gallons of water up to a boil. Poach whole chicken breasts in a couple of gallons of water and set aside when nearly done. They’ll be cut up and sautéed later, so you needn’t worry about undercooking. Add the roasted bones to the poaching liquid and bring up to a simmer. Add a couple of quarts of chopped onions, celery, and carrots along with spices. This stock is a bit different from normal, so you’ll be using cilantro, cumin, and coriander. Simmer for 2 – 4 hours, strain, and set aside. As the great outdoors is an extended cooler in December, I strain everything into a big bowl, put back into the stock pot, and set outside for the night.

We’re only getting started. Peel a couple pounds of carrots and slice into match sticks. Do the same for some bell peppers. These will be sautéed later and added to the tamales.

Back to the chicken. Cut the chicken into half-inch pieces. Finely chop some carrots and the tops of the bell peppers. Finely mince a few cups worth of yellow onions. Heat up some oil in a frying pan, add one third of the minced veggies and onions, a couple of tablespoons and some achiote (used to color dishes in Latin America). Add the chicken breast pieces and stir fry until colored and fully cooked. Set aside and repeat. Do the same for the bell pepper and carrot match sticks.

The banana leaves will need to be prepared. Slice them into roughly 9” squares. Two are needed for each tamal. Avoid Goya brand (they were surprisingly bad). We went through 20 packages of prepared banana leaves. You might guess from the scale that we make a lot of tamales. We wound up using about a gallon of homemade turkey stock to supplement the broth (making 3 gallons in total) and wound up with over 150 tamales by the time we were done.

Now we make the masa. Take the chicken stock back from the porch and heat to a simmer. Add the riced potatoes and mix. Gradually add the corn flour (Maseca), and stir. You’ll want folks with some muscles and it’s going to get thick. Once it’s completely thickened (you’ll need a Latina to tell you when), take out to the table as you’re ready to make tamales.

At this point, you should have a honking big stock pot full of masa. There’s a big bowl of sautéed chicken breast chunks. There’s also a couple bowls of sautéed bell pepper and carrot match sticks. You’ll also have bowls of olives, capers, and raisins (we use craisins). Think Costco sized portions.

Now we’re ready to assemble the tamales. Put one banana leaf section on top of another, the smaller on top. Plop about a half cup of masa on them. Add two chunks of chicken, one on each end. Add a few match sticks of carrot and bell pepper. Put a few capers on one end, an olive or two, and some craisins. Wrap it up (you’ll need guidance) and set aside. Each pack has two tamales, set back to back and wrapped in twine. Hemp twine is in-effing-credible. Best stuff I’ve ever used.

Once the tamales are wrapped and tied, they need to be cooked. Fill as many pots as you have room for with tamales on their ends. Pour water into the pot until about halfway up the tamales. If you have a pot that’s taller than the tamales, you can stack a few on top and cover them. Boil/steam for about 45 minutes.

When it comes to eating the tamales, we microwave them and serve them with Salsa Lizano, a Costa Rican savory sauce. It’s the same type of sauce as Heinz 51.


I hope everyone’s holidays are going well. I wanted to show you some pictures of a dog my wife and I rescued, we call him Puppa. About 6 months ago he showed up in my neighborhood, starving and looking forlorn. Whoever had him had put a shock collar on him:puppa starving

Puppa was very scared of people, yet wanted companionship. If you walked a dog, he’d follow you, but at a distance of no less than 10 feet. We took to feeding him, he loves hot dogs, and leaving out water. It took us two months to lure him over to my street and in front of my house. We couldn’t catch him however. No matter what we did, he’d never come any nearer than 10 feet. we even got some tranquilizers from my vet, with no luck. On Christmas morning I went out to feed him his holiday hot dogs when a SUV approached me, a woman inside asked me if Puppa was my dog. I told her it was a stray that I’d been trying to catch. It turns out she lives in an adjoining subdivision, works for a private animal rescue, and had noticed Puppa on a walk with her dog. She agreed to set up a trap that day, and if we caught him, to get him to the vet. Well, sure enough it worked! That afternoon, Puppa was in the trap!puppa trapped

The vet cut off the shock collar:photo (94) though I wont torture you with pictures of the horrible wound it left.

I take Puppa home on Wednesday and have visited him everyday. Yesterday he put his paw on my hand: Puppa

I haven’t had all that great a year, but it sure is ending well.

I miss commenting here, so I am going to resume

Merry Christmas and a Happy New Year!


Morning Report – On the Waterfront Edition 12-28-12

Vital Statistics:

  Last Change Percent
S&P Futures  1401.8 -8.9 -0.63%
Eurostoxx Index 2633.2 -26.8 -1.01%
Oil (WTI) 91.01 0.1 0.15%
LIBOR 0.308 -0.003 -0.96%
US Dollar Index (DXY) 79.81 0.188 0.24%
10 Year Govt Bond Yield 1.70% -0.03%  
RPX Composite Real Estate Index 192.3 0.0  

Stock index futures are lower on pessimism about a budget deal. Obama will meet with Congressional leaders today to see if they can hammer out a deal. The House will meet on Sunday night. The same story remains – stocks are worried about going over the cliff, while the bond market seems skeptical.  For a laugh, check out Rick Santelli’s rant about the way the markets are handicapping it. 

One other possible headwind for the economy in Q1 – a longshoreman’s strike that would close cargo ports on the Eastern Seaboard and the Gulf Coast. This would not only limit raw material supplies to US factories, it would also push many logistics workers, truck drivers, etc on to the unemployment rolls. Some economists estimate that a strike could cost the US economy $1 billion a day. Will Obama risk alienating his labor base to intervene?  Fun fact:  the average compensation for a longshoreman in $124k.

Yesterday’s consumer confidence numbers took a step downward, and seem to back up reports that this year’s holiday sales were weak.The outlook for business conditions and labor markets fell. 

Chart:  Conference Board Consumer Confidence:

 In spite of the pessimism over the fiscal cliff, luxury homes priced over $1 million are making a comeback. Sales have risen by 9% for the first 9 months of 2012.  Strong foreign demand has been driving up prices in Manhattan and the Hamptons. In terms of foreclosures over $1 million, the NYC suburbs hold 4 out of the top 10 zip codes, with New Canaan taking the lead.  This is still the wreckage from the bust, where lots of $1 million a year guys lost their jobs in 2007 and haven’t worked since.

Morning Report – the Mod Squad 12-27-12

Vital Statistics:

Last Change Percent
S&P Futures 1416.2 2.7 0.19%
Eurostoxx Index 2665.1 16.6 0.62%
Oil (WTI) 91.18 0.2 0.22%
LIBOR 0.311 0.001 0.32%
US Dollar Index (DXY) 79.44 -0.182 -0.23%
10 Year Govt Bond Yield 1.77% 0.01%
RPX Composite Real Estate Index 192.3 0.5

Markets are quiet again as desks are understaffed both in Europe and the US. Initial Jobless Claims fell to 350k, back to the bottom end of our 350k – 390k range. Bonds and MBS are down small and continue to dismiss the possibility of a cliff-induced recession.

President Obama heads back to Washington to try and craft a deal to avert the fiscal cliff. The WH seems to have backed off its proposal to increase taxes at 400k and has moved back to 250k. It is looking more and more like we will go over the cliff on Jan 1 and then pass some sort of tax cut package soon thereafter.  Treasury informed Congress that we will hit the debt limit on Monday, but they can play some games to keep the government funded through Feb.

Of course, once we climb the fiscal cliff, we will go right into the battle of the debt ceiling. Moody’s has already fired a shot across the bow, saying that they expect the government to raise the limit, but they may downgrade the U.S.’s credit rating unless we get a decrease in the debt / GDP ratio.

Yesterday’s WSJ report on possible new initiatives to mitigate the effects of the housing bust have already been met with skepticism. The first plan involved allowing deeply underwater non-agency loans to refi into Fan and Fred loans.  James Pethokousis of the American Enterprise Institute points out that allowing the GSEs to refi underwater non-agency mortgages is a non-starter with virtually all Republicans and many Democrats as it shifts risk from the private sector to the public sector.  Plus, you have to get the originators on board, and they won’t make 125%+ LTV loans without some sort of safe harbor against buyback risk.

A second plan would further expand HAMP, by changing the definition of “in danger of imminent default” to include anyone who is has a LTV over 125%, even if they are current on their mortgage. Such a move would not require Congressional approval. The American Securitization Forum is against the idea, given that these loans are worth their weight in gold.  They are current, have above-market coupons, and have virtually no chance of being prepaid for years. If enacted, investors would take an income hit (although Treasury would pay them the coupon difference for 5 years), and would see a capital loss as well. My sense is that ASF’s argument will be met with very little sympathy in the Administration, although state and federal pension funds will be quietly making the same argument as well. Still another hurdle would be servicers, who would have to buy off on the idea that modding a current loan is somehow good for the investor.

Morning Report – Case-Schiller 12/26/12

Vital Statistics:

  Last Change Percent
S&P Futures  1422.7 2.9 0.20%
Eurostoxx Index 2648.5 -2.6 -0.10%
Oil (WTI) 89.09 0.5 0.54%
LIBOR 0.31 0.000 0.00%
US Dollar Index (DXY) 79.66 -0.015 -0.02%
10 Year Govt Bond Yield 1.78% 0.00%  
RPX Composite Real Estate Index 191.8 0.1  

Markets are quiet this morning, as most of Europe is shut for Boxing Day. Bonds and MBS are flat.

Not much is happening on the fiscal cliff front, although Obama plans to cut his vacation short and return to Washington to try and hammer out a deal. Chances of any sort of grand bargain are virtually nil; all that could be accomplished at this point is some sort of fig leaf. In spite of the political and economic uncertainty, and the early indications of a weak Christmas, the bond market still refuses to price in the possibility of a recession. 

The S&P / Case-Schiller index of home values came in at  145.93 for the month of October, up 4.3% year-over-year and up 66 basis points month-over-month. The hardest-hit MSAs continued to show the biggest gains, with prices up 22% in Phoenix and 10% in Detroit. The Northeast MSAs (Boston and NY) are showing the smallest increases.

Chart:  S&P / Case-Schiller:

The Obama administration is considering expanding its mortgage-refinancing program to include underwater borrowers with non government loans.  Such a move would require legislation to change Fannie and Fred’s charters and would also involve a bump in the guarantee fee to price in the additional risk. It will also require the blessing of FHFA, which has indicated general support for the program.  Finally, it will require some sort of immunity from buy-back risk in order to get originators on board. 

A new study confirms what many have thought about high-frequency trading:  It is highly profitable and adds no value to the system as a whole. Aggressive, liquidity-taking high frequency trading (in other words, front-running) does the best. The profitability of HFT seems to be persistent – new entrants are less likely to be profitable and are more likely to exit. Speed matters above all, and that is why James Simons is so consistently profitable.

Merry Christmas, ATiM

This is Christmas!

So, Mark, does your family do what Elena Kagan does (or at least claimed she does in her confirmation hearings) and get Chinese food on Christmas day?  I think “Seinfeld” was where I heard that first.  And there’s always “A Christmas Story” and the introduction to Chinese turkey:

For some reason I can’t find either of these whole cartoons on youtube, but here’s the part that’s the core of the Charlie Brown special,

and here’s my very favorite song of the season

Don’t ask me why, but that song just struck me as wonderful when I was a little kid.  My parents tell me that I would get up and dance around to it every year when we watched the special on TV–maybe it’s that amazing bass voice.  But it’s also hard to top Nat King Cole:

At any rate, I hope that this holiday season has been a joyous, peaceful, and love-filled one for all of you.  And may 2013 be even better!

Morning Report – Merry Christmas edition 12/24/12

Vital Statistics:

Last Change Percent
S&P Futures 1421.8 -4.1 -0.3%
Eurostoxx Index 2648.3 -3.0 -0.15%
Oil (WTI) 88.38 -0.28 -0.31%
LIBOR 0.31 0.000 0.00%
US Dollar Index (DXY) 79.46 0.156 0.15%
10 Year Govt Bond Yield 1.77% +0.04%
RPX Composite Real Estate Index 191.8 -0.1

Markets are quiet this morning as most shops have skeleton crews on the desk.  Stock and Bond markets will be open until 1:00 pm.  There is no economic data this morning. Bonds are down while MBS are flat.

The fact that bonds have not rallied in the face of the machinations of the fiscal cliff has me scratching my head. Mohammed El Arian of PIMCO believes a recession is now more likely. If we enter a recession, we could be looking at a 1.25% 10-year.  We broke 1.4% in late July. Yet here we sit at 1.77%.  Liquidity is typically low this time of year, so you can’t read too much into it, but unless we get a deal on the cliff soon, we could be looking at a big rally in Treasuries come January.

With the collapse of Boehner’s Plan B, all attention turns to the Senate which hopes to devise some sort of band aid to prevent the worst of the fiscal cliff. In particular, Mitch McConnell has been more of an observer than a participant as negotiations have centered on the WH and House. Apparently Joe Biden has better luck dealing with the Minority Leader than Obama, and has earned the reputation as the “McConnell Whisperer.” Democrats are urging Boehner to re-enter negotiations with a bipartisan bill. Ironically, by rejecting Boehner’s Plan B, Tea Party Republicans in the House have lost their seat at the table.

Lender Processing Services is out with their first look at November delinquency numbers. Delinquencies are up sequentially, while foreclosures are down.

The Fed is disappointed that mortgage rates are not responding to the Fed’s MBS purchase program. At least the story mentions the reason – increases in guarantee fees. Most stories about this (The Washington Post is absolutely terrible on this) don’t mention the fee increase. Even the WSJ does it, by mentioning “higher fees charged by Fan and Fred” in a generic fashion, as if they are inconsequential.  People don’t understand how much G-fees matter. There is the perception in Washington that lenders are simply pocketing the difference when in reality their costs have increased. The media has glommed onto the idea that the financial industry is inherently crooked and there is no disabusing them of that.

Merry Christmas to all.

Morning Report – Over the cliff we go 12/21/12

Vital Statistics:

  Last Change Percent
S&P Futures  1418.4 -22.2 -1.54%
Eurostoxx Index 2645.3 -13.0 -0.49%
Oil (WTI) 89.04 -1.1 -1.21%
LIBOR 0.31 0.000 0.00%
US Dollar Index (DXY) 79.38 0.116 0.15%
10 Year Govt Bond Yield 1.75% -0.04%  
RPX Composite Real Estate Index 191.8 -0.1  

Stock index futures are getting crushed this morning after House Speaker John Boehner postponed a vote for Plan B, which would have raised taxes on millionaires, after he couldn’t get enough Republican votes.  He has scheduled a press conference for 10:00 am. This is probably the final nail in the coffin for a deal before the end of the year.  It also could mean Speaker Cantor.  

So, what are the options now on the fiscal cliff?  John Boehner could continue to work with the President on a deal that can garner bipartisan support in the House.  Second, the House could pass the Senate bill, with Republicans voting “present.” Finally (and probably the most likely outcome) is that we go over the cliff and immediately pass tax cuts in the new year. It goes without saying that all of this is dependent on the world not ending today.

On the economic data front, Personal Income and Spending came in better than expected.  Durable Goods were higher than expected and the Chicago Fed National Activity Index rebounded. Of course none of that matters right now. Bonds are up a point, while MBS are up 1/4. In view of what is happening in Washington, I wouldn’t want to be short bonds right now.

Morning Report: Merger Mania on Wall Street 12/20/12

Vital Statistics:

Last Change Percent
S&P Futures 1430.2 -2.9 -0.20%
Eurostoxx Index 2654.9 0.2 0.01%
Oil (WTI) 89.7 -0.3 -0.31%
LIBOR 0.31 0.000 0.00%
US Dollar Index (DXY) 79.12 -0.145 -0.18%
10 Year Govt Bond Yield 1.78% -0.03%
RPX Composite Real Estate Index 191.8 -0.1

Markets are slighly lower after a slew of economic data this morning.  3Q GDP was revised upward to 3.1%.  Initial Jobless Claims came in at 361k. Consumption rose 1.6%.  The November Index of Leading Economic Indicators fell .2%.  Bonds and MBS are flat.

The FHFA House Price Index rose a half of a percent in October.  Sep was revised downward.  Prices are up 5.6% YOY and the index is 15.7% below its peak in April 2007.  We are more or less back to Summer of 2004 levels.

 The Intercontinental Exchange (ICE) has agreed to buy NYSE Euronext for $8.2 billion.  It shows just how much the importance of trading equities has fallen.  Who would have thought a 12 year old scrappy upstart from Atlanta would end up buying the New York Stock Exchange, Paris Bourse, and the Amsterdam Exchange?  The floor of the New York Stock Exchange is more or less just a museum these days.  Separately, Knight Capital Group, the Nasdaq market-maker which lost $460 million on a computer glitch earlier this year, agreed to deal with Getco, the Chicago-based leader in high frequency trading.

On the fiscal cliff front, the House plans to vote on a measure that increases taxes on millionaires.  Obama has already threatened to veto it. The current bid / ask spread is 400 – 1000, meaning that Obama wants the threshold for higher taxes to start at 400k, while Boehner wants it to start at 1 million. Bloomberg has a good backgrounder on the relationship between Obama and Boehner.

KB Home announced their 4th quarter and full year earnings this morning.  Deliveries were up 6% and average selling prices increased 10% sequentially and 23% year-over-year. Backlog is up 35% and that potential revenue would be the highest since Q407. Larger homes were the driver, which accounts for the jump in ASPs.

Hometown in the NYT

A new mixed-used town center that I frequent was featured in the NYT. Thought I’d pass along so those who are interested can get a sense of life inside (or in this case barely outside) the beltway. My home is about 10 minutes from here. With the new HOT (High Occupancy Toll) lanes on the beltway, it’s about 3 mins and 30 cents. Or free if the whole entire family is in the car. If the development continues, it will be accessible by bicycle. Too much traffic for that now.

The story neglects the best part of the movie theater: the full service bar.

We considered the town homes that are for sale, but decided to stick with our home.

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