Crews Letter #2008 06 The Price of Their Toys

What is the difference between men and boys?

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Good morning Crew,

We are back in the Northern Sporades. They are a lovely archipelago North of Athens. We cruised here in 2006. We came for cooler weather and moderate winds. Moderate throughout most of the Aegean in August is anything less than a full gale. It is August. August means Meltimi in the Aegean. Meltimi is a low pressure area over Iran and a high over the Balkans. The result is clear air, no clouds and strong Northeast winds, Meltimi, in the Aegean. If you are south of a mainland, Greece or Turkey, the land mass heats things up. Temperatures top out somewhere over 40C (104F). We have seen 48C (120F). Some ocean to the North can cool this down a bit.

It is a spherical chart. North is along the Longitude lines converging at the top, the North Pole. Italy really does look like a boot.

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As the price of oil is on everyone’s mind in the US, the upcoming election in the US is on everyone’s mind here. We filled Perception’s diesel tank today. This time 90 litres (24 gallons). At 1.42€ per litre, it works out to be about $8.60 per gallon. That is up from previous years. However, more of the up can be attributed to the down of the dollar than the up of the oil. In fact, the up in the oil price is proportional to the fall of the dollar’s value.

In the last seven years, the dollar has lost half its value when exchanged for Euros. The European economy has experienced significant inflation in the same period. In 2001, we boasted that a crew of four could have a nice dinner with wine at a Greek traverna for 47€ ($40). Today, the same meal is 75€ ($120). Inflated price, euro to euro is 160%; dollar to dollar, 300%.

In Skiathos last week, I had a conversation with the Captain and the owner of Odio, a Ferretti 165. She is a 16.5 meter (55 foot) motor vessel. The Captain is a retired commercial captain with very complete English. We exchanged some sea stories. He told me that Corpus Christi is his favorite city in the US. He did not tell me about the girlfriend there. The owner is an Athens businessman with very little English. The conversation moved quickly to boat engines and fuel consumption. Odio has two engines, 400 hp and cruises at 33 knots. Perception has one, 57 hp, and cruises at 6 knots under engine, 5 to 10 knots under sail alone. Wind speed and direction are the determining factors. Odio uses 300 litres of diesel per hour; Perception, 2.8 litres under engine, zero under sail.

Odio is based in Zea Marina in Athens. She had just made the trip Athens to Skiathos as had Perception. The Captain chose a good day, weather wise, and came in seven hours. Perception made the same passage in six days, with one day out for bad weather. Odio used 2200 litres of diesel. Perception used 90.

Odio’s owner commented, “The thing I do not have is time. When I retire, I may learn to sail.”

In the last seven years, the dollar has lost half its value when exchanged for Euros. The European economy has experienced significant inflation in the same period. In 2001, a gallon of diesel was €2.92 ($2.48). Today, the same gallon of diesel is 5.37€ ($8.48). Inflated price, euro to euro is 184%; dollar to dollar, 342%.

Some data points for your consideration.

What is the difference between nations?

A good financial metric of a nation is the strength of its currency. It is hard to imagine how the European economy can be doing better than the US. A Republican majority in the Senate and House for 12 of the last 14 years and a Republican Administration for the last 8 is good for business.

Let the navigator sleep,

Fred