Toronto Reviews

Toronto Reviews

Beautiful, cosmopolitan city of Toronto, Ontario

In theory, Toronto is a city with all work and no play, which can make Jack a dull boy (Shining, Stephen King), but in practice, this vibrant, magnificent city, is as lively as can be. Similarly, in theory (and in practice!) Websites like Expedia and TripAdvisor may come in handy in planning an escapade to a distant destination, but a detailed personal experience account may likewise enlighten one on places top visit, where to stay and how to eat and stay healthy in a new environment.

Where to stay in Toronto, Ontario:

Like most North American cities, Toronto has hotels and motels for almost all budges. Most places will require a valid credit card to book a room, and absolutely all accommodations demand to see some form of ID (from the ones we visited).

The Sheraton hotel chain hardly needs any introduction. An established luxury line of hotels and resorts, the Sheraton is a worldwide elite place to stay in, as long as you can afford it. Popular among businesspeople and couples celebrating their honeymoon, Sheraton hotels exist all over the world, being present in Canadian cities such as Montreal and Toronto, as well as exotic tropical islands such as Bora Bora. The Toronto Sheraton hotel is no different, containing all the amenities necessary for a more than pleasant stay, with more than 40 floors in altitude, splendid rooms and a high perched lounge overseeing the metropolitan. Rates vary from standard rooms to upscale, high end suites, but usually Sheraton hotels are considered in the pricier continuum of the temporary accommodation spectrum, although quite affordable if you consider the number of stars and services available (i.e. price and quality trade off).

The Fairmont Royal York hotel of Toronto is right in front of the train (Union station subway) downtown. The spectacular VIP hotel may be seen as a counterpart to the famous Fairmont Queen Elizabeth in Montreal, of international fame due to Yoko Ono’s and John Lennon’s sleep in for world peace. Naturally, Toronto likewise has the Hilton, Omni, Soho, Marriott and Ritz Carlton (list by far non extensive).

Toronto Night View from  the Queens Quay. Photo : Elena

For hotels in the middle price range, there are places like the Comfort Inn (several locations), the Ramada (double suite extremely comfortable, with “at home” apartment feel’), the Best Western (Primrose) downtown and the Radisson Admiral Harbourfront on the new and refurbished Queen’s Quay.

Other hotels include the Econo Lodge (quite affordable hotel on Jarvis Street, close to Carlton intersection). Finally, for those without a credit card and on more modest budgets, the Weaverly, on the corner of College and Spadina may come in handy. With Toronto’s Chinatown’s attractions, a colorful market, countless laundromats and dry cleaners nearby, the inn may come in handy for a traveler looking for their next adventure.

Finally, last but not least, the Shangri-La hotel is rumored to be among the best the city has to offer, with out-of-this-world suites commanding several thousands per night! Goes without saying, we had to pass…

On a more general note, the main streets of Toronto include Bloor (Yorkville), York, Yonge and Bay. With multiple Holt Renfrews (classy, exclusive shopping malls) and various designer and jewelry boutiques (Rolex, Cartier, Prada, Louis Vuitton, Prada, Chanel, Gucci, Fendi, Burberry, Hermes, Dior, Agent Provocateur – the sultry British lingerie brand endorsed by sexy actress Penelope Cruz – and countless others), the city (which at time of writing, just underwent mayoral elections on October 27, 2014, replacing celebrity mayor Rob Ford with John Tory) is one of the most popular cities in the world to visit, well, at least as far as we’re concerned. Also, obviously, don’t forget the breathtaking CN Tower and the adjacent aquarium (Aquarium of Canada)…

Toronto's Coat of Arms. Photo by Elena

Billy Tumult

Billy Tumult

By Nick Harkaway (excerpt)

Billy Tumult, walking down the street. Tips his hat to the ladies, bids the fellas good afternoon. Going to the Marshall’s office. Want to be in good with the local force. No stink-of-armipit law-keeper, this one, but a high buttoned pinstripe and waistcoat number, almost a dandy. What are the chances, Billy Tumult growls. Man might could be Billy’s brother, might could use him for shaving around that dandy moustache. Patient’s been thinking about coming to see Billy Tumult for long enough that he’s got hisself a tulpa in here, a little imaginary robot doing what the patient thinks Billy’d do. Ain’t that just the sweetest thing?”

Marshall William says hello, and Billy says hello right back and they shake hands. It’s like iceberg colliding. The Marshall’s got two shooters on his hips, of couse, just like in the brochure. What’s behind his back, Billy wonders’ maybe a third gun, maybe a humungous nature of a knife. That would figure. But when they get into the Marsall’s office and the fella takes off his coat, mother of Christ, it’s a dynamite vest, a bandolier. Thy guy so much as farts wrong and they’re all in the next county over and fuck if he doesn’t actually smoke. Laws of sanity have been suspended for Billy’s oversold publicicty-and-marketing hardassery. Thank God if the thing goes up the worst that happens to Billy is a damn reset and the whole surgery to redo from start, pain in the ass, but if this was the real world or if Billy was really part of this whole deal then he’d be pasta sauce.

Pasta sauce is authentic. Billy tweaks the filter again. He prefers the gangster aspect, can’t keep the horses-and-mud shit straight in his brain. Well, if the patient can have Eskimos, Billy can have pasta sauce, call if fair play.

A path. Photo by Elena

I’m Billy Tumult of the Pinkertons, he tells Marshall William, come lookin’ for a dangerous man. We got plenty, says the Marshall, which one you want? Or take’em all, I surely won’t miss’em. I want the new guy, Billy says, the one in the black hat living over the story. The one Missus Roth has an arrangement with. Now hold on, begins the Marshall, no not that kind of arrangement, the feedin’kind is all I mean, I got no beef with the Widow Roth.

Widow my ass, parenthiesizes Billy Tumult, if I know how this goes, but never mind that for now.

He’s an odd one, sure, says the Marshall Odd and I don’t like him and he don’t much like me. But I figure the one he’s looking out for is you, now I think on it. He offered me a whole shit-ton of gold, I saw it right there in that room, to tell him if a fella came askin’ about him. You say yes? Billy wants to know. No, Marshall replies, “Course not, he says, and rolls his shoulder.

Cutaway: a thin man naked in a room full of gold, lean like a leather-gnarled spider stretched too tight on his own bones. He tilts his head and listens to the sound of the town, and he knows someone’s coming. Slips down the gold rockface into his pants and shoes – demons evidently need no socks – and buckles on his gun. Not much of a thing, this gun. Small and dirty and badly kept. Buckles it on, long black coat around his shoulders. Tan galan on his head: bare-chested Grendel in a hat, and that’s as good a name as any. Arms and legs too long, Grendel spderabs out of the golden room and into shadow, gone a-huntin’. Too fast, he’s under the balcony across the street, flickers in the dark alley by the blacksmith, by the sawbones, by the water tower. Too fast, too quiet. All of a sudden: it’s not clear at all who’s gonna win this one.

Defining Risk: The Dispersion of Returns

Defining Risk: The Dispersion of Returns

Risk is a most slippery and elusive concept. It’s hard for investors – let alone economists – to agree on a precise definition. The American Heritage Dictionary defines risk as the possibility of suffering harm or loss. If I buy one-year Treasury bills to yield 8 percent and hold them until they mature, I am virtually certain of earning an 8 percent monetary return, before incoming taxes. The possibility of loss is so small as to be considered nonexistent. If I hold common stock in my local power and light company for one year on the basis of an anticipated 9 percent dividend form, the possibility of loss is greater. The dividend of the company may be cut, and, more important, the market price at the end of the year may be much lower, causing me to suffer a serious net loss. Risk is the chance that expected security returns will not materialize and, in particular, that the securities you hold will fall in price.

Once academics accepted the idea that risk for investors is related to the chance of disappointment in achieving expected security returns, a natural measure suggested itself – the probable variability or dispersion of future returns. Thus, financial risk has generally been defined as the variance or standard deviation of returns. Being long-winded, we use the accompanying exhibit to illustrate what we mean. A security whose returns are not likely to depart much, if at all, from its average (or expected) return is said to carry little or no risk. A security whose returns from year to year are likely to be quite volatile (and for which sharp losses are typical in some years) is said to be risky.

Bloor street, Yorkville. Photo by Elena

Exhibit

Expected Return and Variance: Measures of Reward and Risk

This simple example will illustrate the concept of expected return and variance and how they are measured. Suppose you buy a stock from which you expect the following overall returns (including both dividends and price changes) under different economic conditions:

Normal economic conditions - Probability of occurrence - 1 chance in 3 – Expected return – 10 percent

Rapid real growth – 1 chance in 3 – 30 percent

Recession with inflation (stagflation) – 1chance in 3 - -10 percent.

If, on average, a third of past year have been “normal,” another third characterized by rapid growth, and the remaining third characterized by “stagflation,” it might be reasonable to take these relative frequencies of past events and treat them as our best guesses (probabilities) of the likelihood of future business conditions. We could then say that an investor’s expected return is 10 percent. A third of the time the investor gets 30 percent, another third 10 percent, and the rest of time he suffers a 10 percent loss. This means that, on average, his yearly return will turn out to be 10 percent.

Expected Return = 1/3 (0.30) + 1/3 (0.10) + 1/3 (-0.10) = 0.10.

The yearly returns will be quite variable, however, ranging from a 30 percent gain to a 10 percent loss. The “variance” is a measure squared deviation of each possible return from its average (or expected) value, which we just saw was 10 percent.

Variance = 1/3 (.30 - 0.10)2 + 1/3 (0.10 - 0.10)2 + 1/3 (-0.10 – 0.10)2 = 1/3 (0.20)2 + 1/3 (0.00)2 + 1/3 (-0.20)2 = 0.0267.

The square root of the variance is called the standard deviation. In this example, the standard deviation equals 0.1634.

Dispersion measures of risk such as variance and standard deviation have failed to satisfy everyone. “Surely riskiness is not related to variance itself,” the critics say. “If the dispersion results from happy surprises – that is, from outcomes turning out better than expected – no investors in their right minds would call that risk.”

It is, of course, quite true that only the possibility of downward disappointments constitutes risk. Nevertheless, as a practical matter, as long as the distribution of returns is symmetric – that is, as long as the chances of extraordinary gain are roughly the same as the probabilities for disappointing return and losses – a dispersion or variance measure will suffice as a risk measure. The greater the dispersion or variance, the greater the possibilities for disappointment.

While the pattern of historical returns from individual securities has not usually been symmetric, the returns from well-diversified portfolios of stocks do seem to be distributed approximately symmetrically. The following chart shows a twenty-five-year distribution of monthly security returns for a portfolio consisting of equal dollar amounts invested in 100 stocks. It was constructed by dividing the range of returns into equal intervals (of approximately 1 ¼ percent) and then noting the frequency (the number of months or 10.7 percent per year. In periods when the market declined sharply, however, the portfolio also plunged, losing as much as 13 percent in a single month.

For symmetric distributions, such as this one, a helpful rule of thumb is that two-thirds of the monthly returns tend to fall within one standard deviation of the average return and 95 percent of the returns fall within two standard deviations. Recall that the average return for this distribution was just under 1 percent per month. The standard deviation (our measure of portfolio risk) turns out to be about 4 1/2 percent per month. Thus, in two-thirds of the months the returns from the portfolio were between 5 1/2 percent and -8 percent. Obviously, the higher the standard deviation (the more spread out are the returns), the more probable it is (the greater the risk) that at least in some periods you will take a real bath in the market. That's why a measure of variability such as standard deviation is so often used and justified as an indication of risk (standard deviation and its square, the variance, are used interchangeable as risk measures. They both do the same thing and it's purely a matter of convenience which one we use).

Burton G. Malkiel. A Random Walk Down Wall Street, including a life-cycle guide to personal investing. First edition, 1973, by W.W. Norton and company, Inc.

Documenting Risk: A Long-Run Study

Documenting Risk: A Long-Run Study

One of the best-documented propositions in the field of finance is that, on average, investors have received higher rates of return for bearing greater risk. The most thorough study has been done by Roger Ibbotson and Rex Sinquefield. Their data cover the period 1926 through 1988. Appearances notwithstanding, the table was not designed to show One Manhattan skyline and a series of Eiffel towers. What Ibbotson and Sinquefield did was to take several different investment forms – stocks, bonds and Treasury bills – as well as the consumer price index, and measure the percentage increase or decrease each year for each item. A rectangle was then erected on the baseline to indicate the number of years the return fell between 0 and 5 percent; another rectangle indicated the number of years the returns fell between 5 and 10 percent; and so on, for both positive and negative returns. The result is a chart which shows the dispersion of returns and from which the standard deviation can be calculated.

A quick glance shows that over long periods of time, common stock have, on average, provided relatively generous total rates of return. These returns, including dividends and capital gains, have exceeded by a substantial margin the returns from long-term corporate bonds. The stock returns have also tended to be well in excess of the inflation rate as measured by the annual rate of increase in consumer prices. Thus, stocks have also tended to provide positive “real” rates of return, that is, returns after washing out the effects of inflation. The data show, however, that common-stock returns are highly variable, as indicated by the standard deviation and the range of annual returns, shown in adjacent columns of the table. Returns from equities have ranged from a gain of over 50 percent (in 1933) to a loss of almost the same magnitude (en 1931). Clearly, the extra returns that have been available to investors from stocks have come at the expense of assuming considerably higher risk. Note that small company stocks have provided an even higher rate of return since 1926, but the dispersion (standard deviation) of those returns has been even larger than for equities in general. Again, we see that higher returns have been associated with higher risks.

A long-run study. Photo by Elena

There have been several periods of five years or longer when common stocks have actually produced negative rates of return. The early 1930s were extremely poor for stock-market investors. The early 1970s also produced negative returns. The one-third decline in he broad stock-market averages during October 1987 is the most dramatic change in stock prices during a brief period since 1930s. Still, over the long pull, investors have been rewarded with higher returns for taking on more risks.

The patterns evident in Ibbotson and Sinquefield’s table also appear when the returns and risks of individual stock portfolios are compared. Indeed, the differences that exist in the returns from different funds can be explained almost entirely by differences in the risk they have taken. However, given the rate of return they seek, there are ways in which investors can reduce the risks they take. This brings us to the subject of modern portfolio theory, which has revolutionized the investment thinking of professionals.

Burton G. Malkiel. A Random Walk Down Wall Street, including a life-cycle guide to personal investing. First edition, 1973, by W.W. Norton and company, Inc.

Navigating the Water of IRAs

Navigating the Water of IRAs

Here’s how to avoid a minefield of penalties

When tax laws limited the tax benefits of Individual Retirement Accounts in 1986, investors abandoned IRAs by the droves. Contributions tumbled from nearly $40 billion in 1986 to around $19 billion in 1994. Investors may have bailed out too soon, though. Even though some IRA contributions are not deductible, tax deferral on the account’s earnings still make IRAs a pretty good deal over the years.

According to Scudder, Stevens & Clark Inc., a global investment management firm, and investor who put $2,000 in an IRA from 1982 to 1986 would have savings worth $16,888 in five years. By comparison, another saver who continued to pump money into the IRA, would have a cache worth more than $32,000 in five years, even without the tax deduction.

Many mutual fund companies lure IRA funds by setting low minimum initial investments and by allowing free automatic withdrawals every month or so. But first, you need to get past the deduction requirements. Well-heeled taxpayers who are covered by an employer-sponsored pension plan or whose spouses are covered by one and can contribute to an IRA but cannot deduce the contributions from their taxes. If neither you nor your spouse is covered by a retirement plan at work and if you each earned a determined sum, you can contribute and deduct the same amount each. If only one of you works, you can contribute and deduct more.

If you or your spouse are covered by an employer’s pension plan, your IRA contribution is fully deductible, as long as your modified adjusted gross income corresponds to a limit established by the government or is less for a single taxpayer. You get a partial deduction if you are married and your joined income is between some established sums. You can calculate modified adjusted gross income by adding your salary and other taxable income and subtracting any adjustments made on your 1040 income tax forms. Then turn to the worksheet included in your form 1040 instructions to figure your modified adjusted gross income.

Once your money is in an IRA, you’ll have to tread gently to get it out without triggering huge penalties. Some rules to keep in mind:

Breaking out early: If you are younger than 59-and-a-half and want to pull out money for a non-medical reason, the IRS gets 10 percent off the top. There is an exception. You can make penalty-free withdrawals if they are part of a series of roughly equal annual payments linked to your life expectancy and expected rates of return. To take advantage of this exception, you must take withdrawals for at least five years or until you are 59-and-a-half, whichever comes first. You can then take out as much or as little as you like without paying a penalty.

The IRAs Maze. Photo by Elena

There’s some leeway in calculating your equal payment schedule. One method is to divide your account total by your life expectancy and estimate the expected return on your account. If you want to take out as much money as possible early, use the highest interest rate that the IRS will consider reasonable. Ths IRS has accepted rates not more than 120 percent of the long-term federal rate published monthly by the IRS. The faster your account is projected to grow, the more you can withdraw annually.

Switching IRA funds: You can move from one IRA to another without paying taxes with either a direct transfer or a rollover. In a direct transfer, your IRA holder transfers funds directly to the new custodian without releasing the money to you. You can make an unlimited number of transfers and don’t need to report the switch to the IRS, but you do face costly transaction fees.

In a rollover, your IRA holder sends you the funds, which you reinvest into an existing or new account. You are allowed one rollover every 12 months and must complete I within 60 days, or you’ll trigger taxes and the 10 percent early withdrawal penalty. You must report rollovers to the IRS. If you intend to switch the funds to a future employer’s retirement plan, don’t add more money to the IRA. Otherwise, the IRA will be tainted and you won’t be able to roll it over again.

Tapping too little too late: If you withdraw from your IRA after age 70-and-a-half and you take out too little based on your life expectancy, you face a 50 percent penalty. If you should have withdrawn $1,000 but you took out only $600, for example, you’ll pay $200 in penalty taxes.

Planning for your golden years

These books, pamphlets, and retirement kits can help you make wise decisions as you devise a retirement strategy. Many are free.

The Dreyfus Personal Retirement Planner (Dreyfus Investments)

Retirement Planning Guide (Fidelity Investments)

Can You Afford to Retire? (Insurance Marketing and Research Association)

Retirement Planning Guide Kit (Retirement Planning Software)

Shaping Your Financial Fitness (National Association of Life Underwriters)

A single’s person guide to retirement planning (American Association of Retired Persons)

Vanguard Retirement Planner (A software kit by Vanguard Group)

The Consumer’s Guide to Medicare Supplement Insurance and the Consumer’s Guide to Long-Term Care Insurance (The Health Insurance Association of America)

Understanding Social Security (Social Security Administration)