Pawn 101: HIgh value pawns

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At Bloomberg News, there’s a interview at Borro, a London pawn shop that brags it services the well-to-do. The owner says, “Where else can you get 50,000 pounds” on the same day?

Well, actually, you could do that at Kamaaina Loan, except we deal in dollars not pounds.

A $50,000 pawn is not that unusual. On Maui with its population of 150,000, we don’t do as many $50,000 loans as Borro might in London, with its population of over 10 million.

But a $50,000 loan is very doable, if you have the collateral. A couple of Rolexes might d — we have customers who have more than a couple of Rolexes.

We have lately opened a private transaction room to handle these big loans, and also to make it more convenient to do estate appraisals, which take some time.

But a $50,000 pawn loan? That doesn’t have to take much longer than a $50 pawn loan.

Call 242-5555 to make an appointment for your $50,000.

Don’t buy that iPhone now!

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So say the tech gurus, because (unconfrmed) rumors have it that the iPhone 5 will be out in a month.

In the past, that has meant that the older models (which remain available) drop sharply in price: to $0 if you are willing to sign a 2-year contract, sometimes.

Whether the rumor is accurate or not, retailers have started dropping the price of the iPhone 4S.
For you as an iPhone carrying pawn customer, what this means is that you will not be able to borrow as much on your phone from now on.

Smartphones are a very popular pawn item. It must be hard to part with your phone, but, hey, sometimes you gotta get a bridge loan to eat or pay rent.

Rolex sues online reseller melrose.com

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Rolex has online watch seller melrose.com, alleging it used counterfeit parts in older, pre-owned watches.

Melrose told the Los Angeles Times it has the right to sell used watches.

There are millions of authentic Rolexes out there, and at least millions of fakes. Know who you are dealing with if you are buying or selling.

What’s Olympic gold worth in pawn?

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An Olympic gold medal is only plate, not solid gold.

It’s really silver-gilt: thin, nearly pure gold over sterling silver.

At current prices of around $!,600 an ounce for gold and $28 an ounce for silver, the metal content of an Olympic medal is around $788.

Add in the sweat equity, though, and it’s priceless.

The nationalism of sport

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The host Britons are doing exceptionally well at the XXX Olympiad (despite Mitt Romney’s doubts), leading to claims by NBC reporters that this is the greatest, most uplifting sporting success in English history.

This is typical of TV, which knows nothing of history. The greatest sports event in English history was its wholly unexpected victory in the 1966 Football Association World Cup, which came at a time when memories of the losses of World War II were still fresh (and you could see bomb craters in London) and the country was in the midst of a distressing economic slump.

As any Englishman will tell you, the ’66 cup changed the public outlook. The well-known writer David Lodge even wrote a novel about it.

Are stocks a Ponzi scheme? How about bonds?

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Idly, I wondered about the “Dow 30,000” book I recalled seeing (but never reading) on a day when the Dow struggled, again, to get to 13,000 and when Bill Gross, the , declared that securities are a “Ponzi scheme” and we will never again see the returns of the past century.

I had forgotten that there were also “Dow 36,000” and “Dow 40,000” books, and learned — what I had not known before — that James Glassman, author of the “Dow 36,000” book, was a financial adviser to John McCain’s presidential campaign and is today founding of the George W, Bush Institute at Southern Methodist U.

That explains a lot.

What does this have to do with pawnshops? Nothing directly, but if you have assets, Kamaaina Loan can turn them into cash. Whatever number the Dow index is at

To mall or not to mall

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Some background on the controversy about the Kihei megamall:

Less than 30 years ago, the sum total of national retailers on Maui was Sears, National Dollar and Woolworth, among general retailers. No Kmart, no Wal-mart.

Today, no Woolworth and no National Dollar.

There weren’t a lot of specialized national retailers here 30 years ago, either: no Pier One, no Sports Authority (which didn’t yet exist).

Today we have outlets from Tiffany to Home Depot and it night seen that rural Maui has caught up with national urban retailing trends. Far from it,

Around 1990, a speaker brought in by the Main Street Association asserted that there were 140 national chains that were NOT on Maui.

I haven’t seen any more recent estimate, but although we have added many, many national chains since 1990, my guess is that the number today would be even higher than 140.

There are a lot more national (and even international) retailers like Ikea than there used to be.

If you think about just fast food chains, Maui lacks dozens. Chick-Fil-A is in the news, but on Maui you cannot either support or protest its position about marriage, because it isn’t here.

Neither is Sonic, Long John Silver’s, Popeye’s, Boston Market, Friendly’s and many more.

Among non-food retailers that are still absent are Target (probably on its way soon), Kohl’s, Bed Bath & Beyond, Pottery Barn and on and on.

This helps to explain the desire of developers to build more malls on Maui. Maui may or may not be a top tier location — it wasn’t for J.C. Penney — but national chains have to expand to satisfy Wall Street.

Tales from a Pawn Shop: The teacher who liked rings

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Every day, a pawn shop is the scene of stories that are uplifting, tragic, funny or a combination of all three, Here, heard at the National Pawnbrokers Association convention, is one that is tragic and inspiring:

THE TEACHER WHO LIKED RINGS

In a southern pawn shop, there was a customer, a schoolteacher, who liked rings. She bought rings, sold rings, occasionally pawned rings.

Sometimes, when she found one she liked, she put it on layaway. Once she retired, and was living on a small pension, she sometimes had difficulty keeping up with her layaway payments.

Often, she failed to pay off within the store’s usual time limit of six months, but the pawnbroker treated her leniently because she was a good customer.

One rather expensive ring had been on layaway for more than two years when the woman died.

The pawnbroker called the woman’s daughter and told her that her mother had had a ring on layaway, still only half paid for, that the daughter could claim if she wanted to.

The daughter came to the store and told the owner that when her mother’s house burned (the cause of her death), everything she owned was destroyed.

“I don’t have a single thing of my mother’s,” she said.

The pawnbroker said, “This ring obviously meant a lot to your mother, since she tried so hard to pay it off. Here, you take it.”

He did not ask for the unpaid balance.

The daughter told the story to her local newspaper, which published it.

‘I learn something new every day’

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I bought a fountain pen, so I went to Office Max to get a bottle of ink. The very young clerk was eager to help, but she didn’t know what a fountain pen was.

“I never heard of that,” said she.

A slightly okler clerk came to our rescue, but it turned out the store had only ink cartridges, not bottled ink. The clerk advised me to try Ben Franklin.

Ben Franklin had bottled India ink, but in a locked cabinet. “You need to lock up the ink?” I asked,

“The kids steal it,” the very helpful clerk said. “They use it for tattoos with a pin.”

I learn something new every day.

(Our Maui Gold Buyers store at 98 North Market sells new, professional tattoo gun outfits for a reasonable price. Don’t steal ink. If you are going to tattoo, do it right.)

Learning to go slow

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Now that the Final Environmental Impact Statement has been approved, the Wailea 670 project will most likely happen. I had my doubts over the past two decades since it was proposed. There are a lot of lessons to reflect upon in this development. Some are good reflections, some not.
In no particular order of significance:
1. Honua`ula, as it is now called, will have one golf course. Wailea 670 was to have had 2. Golf courses have managed to lose a lot of money for their owners over the past 20 years here. Several have gone bankrupt. Others have sold at distress prices. There’s no doubt golf sells, but there are many courses, relatively few golfers. We will keep seeing golf courses in big developments, because they are an attractive way of decorating the main drainageway. For each developer, it looks like a way to monetize a piece of infrastructure. Over time, it probably results in more courses than the traffic will bear.
2. A cap on annual deliveries of 100 houses a year is novel. In the past, developers wanted to sell as many as quickly as they could, particularly in a big project in an area devoid of infrastructure. The upfront infrastructure costs incurring a heavy burden of debt service. Today, and for as long as the Federal Reserve decrees, the burden of debt service will be small. Over the past 20 years, few developers could sell as fast as they hoped, so the cap of 100/year probably won’t have much practical effect.
3. But requiring the 250 (off-site) affordable houses to be built first will add heavily to the builder’s upfront costs, especially if they end of costing him beaucoup bucks. The history of affordable in South Maui has not been inspiring. When the Grand Hyatt (as it then was) built its off-site employee housing, the employees didn’t want it. The project found a hard time filling up in competition with other, standalone projects, too. In West Maui, the story has been different, because there, instead of too much (by some people’s standards) housing, there has been too little (by anybody’s standards). But that should be the topic of a future post.
4. Off-site environmental mitigation has had a mixed record. Lee Altenberg, a population biologist, fought for years to preserve a patch of native wiliwili forest in the lower corner of Wailea 670/Honua`ula. Lower corners, though, are where developers want to put their sewage treatment plants (to avoid pumping costs; sewage runs downhill), and so here. So far, Altenberg has not succeeded in making his point with the Maui Planning Commission. It’s hard for people who do not care for native plants to get it, though. 95% of the native wiliwili forests have been wiped out by farming and building and roads. By definition, the remnants are in “waste lands” that nobody (until now) cared about. It is hard to get people to understand the concept of “scarcity value” when it comes to land use. From the developer’s point of view, putting his sewage treatment plant anywhere else raises costs and makes his houses harder to sell.
5. Already, according to Nanea Kalani’s news report in The Maui,News, there is nervousness about the cost of water in the private water system. The infrastructure expense is eyepopping — $22 million for a 1,150-unit project, or about as much as the county water department spends on its physical plant for the entire island in a year. That’s expensive water. The report does not mention, and perhaps nobody remembers, that there was a question way back when about that water. Wailea 670 drilled 2 wells, for irrigation. They were expected to come up brackish. They flowed sweet and clean. David Craddick, then the water director, said if they were fresh, the water was the county’s. Charlie Jencks said, just wait till we’ve pumped for a while; the water will turn brackish. This is an experiment worth watching. There are rumors of more fresh water in the South Maui aquifers than the older studies (and current legal parameters) admit. Wailea 670 did not choose a promising site for its wells. It drilled where it owned. If it’s true that you can hit fresh water more or less at random on the south slope of Haleakala, that changes the development game in a huge way. Low-growthers should be praying nightly that those wells turn brackish and soon.
6. Bike and hiking trails. These have to be in developer plans in order to get approving nods from trendy people, but it’s doubtful they will ever be used enough to justify their cost. There’s a reason nobody hikes that hillside now: it’s steep, hot and dusty. Following development, it will still be steep and hot.
7. Jencks said the project needs to move within 3 years, but he is counting, in part, on either joint venture partners or buyers of pieces with their own development money. Presumably, he has somebody in mind, but Kaanapali 2020 has been looking for JV partners for a long time and apparently they are hard to find.