Halfway down the Danube

More about Money

If you don't find economics interesting, don't read this.

There are a couple of local wrinkles that complicate the credit situation here in Romania. The biggest one is that National Bank of Romania (Romania's Fed, more or less) has placed a lot of restrictions on the movement of credit. Some of these are stupid remnants of the bad old days of the command economy. Others, though, are entirely rational. The NBR is legitimately concerned about a currency crisis.

See, the banks would love to borrow on the international money markets. Romania is capital-starved, so interest rates here are really high. That means that the banks can go outside the country, borrow euros or dollars at low western interest rates, and then turn around and lend them to Romanians at much higher rates of interest. We're talking, like, borrowing at 5% and lending at 16%. Even given high risks and administrative costs, this is still an incredibly tempting and lucrative scenario.

But. When the banks loan money to borrowers in Romania, those loans are in Romanian lei.

So, picture this: a Romanian bank goes to, say, Frankfurt, and borrows 50 million euros at 5%. It converts the euros into lei -- 1 euro is about 40,000 lei, so it would be two trillion (!) lei. It lends the money out, collecting 12% interest. (It will be charging more than 12%, but some of that will be eaten by nonperforming loans and administrative costs.)

For the first year, the Romanian bank will owe 2.5 million euros of interest to Frankfurt. Since it will collect (2 trillion x 12%) 240 billion lei, that's not a problem -- 240 billion lei can be swapped for 6 million euros. The bank pays Frankfurt the 2.5 million and pockets the difference: 3.5 million euros. Nice.

But suppose the leu collapses?

This is not impossible -- it happened in Indonesia, where the rupiah crashed to about 1/4 of its original value in about 60 days. Some of that was hysterical overshoot, but when the rupiah stabilized it was trading at a bit less than half its original price.

Imagine that the leu suddenly crashes to 100,000 to the euro. The Romanian Bank is still collecting 240 billion lei per year. But those lei will only buy 2.4 million euros. Now the Romanian bank can't even cover the interest payments on its foreign loans. The bank is bankrupt.

Even a more modest drop -- say, from 40,000 to 60,000 -- would seriously trash the banks. They'd still be able to make interest payments, but their profits would disappear -- and they'd find it very, very hard to pay back the principal of loans that had (from their point of view) suddenly increased by 50%.

This is not an idle fear; it has happened several times in various places around the world. So the NBR places fairly sharp restrictions on the ability of Romanian banks to borrow foreign currency.

Of course, this in turn restricts the growth of lending -- the more Romanian banks have to rely on local deposits, the less they can lend. But that's a price the NBR is willing to pay.

Money, money, money

I don't blog much about work here. Partly that's out of discretion; mostly, though, it's because a lot of my work is pretty technical, and I don't think too many people would be very interested.

Still, this week I happened to run across some interesting statistics. By chance, my work had me dealing with three different sorts of financial instruments -- mortgages, microfinance loans, and factoring. And I was intrigued to find that all three have been undergoing explosive growth in the last few years.

Here are some numbers.

Mortgages -- we all know what mortgages are, yes? Borrowing money from a bank, pledging your land or apartment to secure payment. Very common and normal in the US and Western Europe.

But before about 1999, this pretty much didn't happen in Romania. Lots of reasons... unclear title (ownership) of land, bad recording systems, antiquated legal system, cautious banks, you name it. Basically it was almost impossible to get a mortgage, and when you did, rates were incredibly high.

They're still pretty high. But the mortgage market has just started to take off. In 2002 there were about $150 million worth of mortgages issued in Romania. In 2003, that number rose to about $450 million. And in 2004, it's expected to hit around $750 million.

$750 million is either a lot or a little, depending on how you look at it. After all, it only works out to about $40 worth of mortgage financing per Romanian citizen -- residential and commercial, combined. $750 million would represent the total mortgage loan for a typical small American town. Hot Springs, Arkansas has more mortgages than all of Romania.

On the other hand, it's pretty impressive for a market that basically didn't exist just five or six years ago. And it's not hard to imagine Romania having a 5 to 10 billion dollar mortgage market by the end of the decade.

Microfinance loans -- these are small commercial loans, less than $20,000 and for terms of two years or less. Most of them are from nonbank lenders.

Right now, the complete microfinance portfolio in Romania is about $35 million. That's not much... but it's up from $16 million in 2002 and $9 million in 2000. And it's expected to rise to around $75 million by the end of 2005.

Those numbers are still pretty small, but it's important to remember that the average microfinance loan is around $4,000 or so. So we're talking about roughly 10,000 loans to individuals and small businesses this year, rising to around 20,000 by the end of next year. Still only one Romanian in a thousand... but it's a start.

Factoring -- factoring is when a business sells its accounts receivable, usually to a bank. "Accounts receivable" are the debts that people owe to a business for goods and services provided. So, for instance, your phone bill is an account receivable for the phone company... until you pay it, at which point it's cash.

Now, a businessman may sometimes want cash RIGHT NOW, instead of waiting 30 or 60 or 90 days for his customers to pay him. So a bank will offer to buy his ARs -- at a discount, of course -- for cash. The businessman gets a quick hit of money, and the bank gets a steady stream of income as the customers pay off their debts.

Factoring has been around in Romania since the mid-1990s, but only on a very modest scale: $12 million in 1995, $15 million in 1996. But in the last few years it has begun to explode. Last year, about $225 million worth of accounts receivable were factored, and that number is expected to be around $350 million next year.

As with mortgages, these numbers are either large or small depending on how you look at it. Great Britain, with about three times the population of Romania, factored over 100 billion dollars of debt last year. On the other hand, factoring barely exists in several transition countries -- Bulgaria didn't start until 1999, and factored only about $20 million last year. And the growth rates are, to say the least, encouraging.

The deeper significance of all this, I may pick up in a later post. For now, what's interesting is that three separate and distinct financial instruments have all shown explosive growth in the last few years. Growth from a very, very low base, yes. But if these growth rates are maintained for just a few years -- a big "if", I know -- it's going to start having some remarkable, and very noticeable, effects.

The President of Macedonia

Nobody pays much attention to Macedonia. It's small, it's isolated, it's one of the poorest countries in Europe.

But there are some interesting things happening there. Here's one: Macedonia had presidential elections yesterday, and they were peaceful and clean. Nobody got shot or intimidated or even threatened, and the general consensus of observers was that the election was pretty clean.

The elections were held to replace Macedonian President Boris Trajkovski, who died in a plane crash in Bosnia a few months ago. Like Serbia, Macedonia runs its presidential elections in two steps -- a free-for-all, followed by a runoff between the two top candidates a couple of weeks later.

(Unlike Serbia, Macedonia still has the old Yugoslav law requiring 50% turnout. There were some worries that they wouldn't get the necessary number of votes, but they did.)

The winner was the present Prime Minister, Branko Crvenkovski. He was considered a "center-left" candidate and "pro-Western".

Labels can be slippery in this region, of course. Still, what we have here is a professional politician, who is neither egregiously corrupt nor a demagogue, who has just been elected by a democratic process that seems to have been clean and fair. Good for Macedonia, and let's hope the rest of the world takes notice.

Mind, it's not all happy shiny. The losing candidate is alleging "massive" fraud in the election. It would have to be, since the official count has him losing by about 20 percentage points.

And, of course, Macedonia remains a painfully poor country, and ethnically divided too. There hasn't been any open violence since 2001, but Albanians and Slavs still view each other with deep distrust, and there are many people on both sides who view the present political system as just a temporary expedient.

Still, that just makes it that much more impressive that they've managed to hold a fair and peaceful election.

The President of Serbia

Presidential elections have been scheduled for June 13.

Serbia has a "French" Parliamentary system -- that is, they have both a Prime Minister (the guy who can get the most votes in Parliament, and who runs the government) and a strong President (who is the head of state, commander-in-chief of the armed forces, and various other things). The President is elected separately from Parliament.

But: since the last President stepped down from office, in late 2002, Serbia has not had a President. They haven't been able to elect one.

Officially, this is because they had an old Yugoslav-era law on the books that said a Presidential election needed a voter turnout of at least 50%. This was no big deal back in the Communist days, when voter turnouts were always quite high. But these days, people are disillusioned and apathetic and it's hard to get them motivated. One, two, three times, in a little over a year, voters failed to turn out in the necessary numbers for the Presidential elections.

I said "officially". In reality, the tunout law was kept on the books by the late Prime Minister Djindjic and his Democratic Party. They could have amended it any time, making the election of a President simple and easy. But Djindjic didn't want to have a President of Serbia.

And he most particularly didn't want Vojislav Kostunica to be President. Djindjic had found Kostunica an annoying partner when Kostunica was President of Yugoslavia -- pedantic, conservative, holier-than-thou -- and was also wary of his popularity. So, Djindjic made sure that the old rules were left in place, and Kostunica never became President.

But now Djindjic is dead, and Kostunica is Prime Minister. And one of the first acts of Serbia's new Parliament was to amend the election law to remove the turnout requirement. So now, at last, Serbia will have a President.

But who? Well, there are three candidates.

Tomislav Nikolic is the candidate of the Serbian Radical Party, and right now it looks like he's the man to beat. The Serbian Radicals were the ultra-nationalist party; their leader, Seselj, is presently in prison at the Hague, awaiting trial for war crimes. But they've moderated their rhetoric a bit, and they're presently the single most popular party in Serbia, with the largest bloc of seats in Parliament. Nikolic is pretty much guaranteed 35%-40% of the vote.

Dragan Marsicanin is the favored candidate of Prime Minister Kostunica and his Democratic Party of Serbia. He's presently Serbia's Minister of Economy. Right now, he's trailing in the polls.

Boris Tadic is the candidate of Djindjic's old Democratic Party. For a while, it looked like the Democratic Party was going to tear itself to pieces; it was blocked out of the ruling coalition in Parliament, and it was divided by a feud between Tadic and party leader Boris Zivkovic (who was Prime Minister for a few months last year, between Djindjic's assassination in March and the collapse of the government in November.) Tadic was Djindjic's Defense Minister, and he's reasonably popular.

The election will have two rounds. If nobody wins a clear majority in the first round (which nobody ever has), then the two strongest candidates go into a runoff two weeks later. Right now the smart money is on Tadic and Nikolic, but the election is still six weeks away, so a lot can happen.

The victory of any of these three would be... interesting... although for very different reasons. More on this in a bit.

The Ferry and the Canal

The ferry from Silistra to Calarasi is... mm, did you ever go to summer camp? Remember the raft on the lake, where kids would climb on and off? Basically metal sheeting over some drums? Well, the ferry is pretty much like that. Just bigger -- enough to hold a dozen or so cars, or maybe fifty people. It wasn't half full when we took it, though. There's a rather flimsy railing around the edge, and that's it.

The ferry is pushed by a little tugboat. Not being streamlined at all, it kicks up a good sized bow wave. It was a perfectly calm day when we crossed, so that wasn't a problem, but I bet it gets pretty choppy when there's even a bit of wind.

It's a pretty crossing. The Danube is maybe three quarters of a mile wide there. The Romanian side is mostly reeds and forest. The Bulgarian side is the city of Silistra, and yes, there is an airliner parked in front of a group of apartment blocks, facing the river. It's an Air Bulgaria jet, maybe a 727, and it looks like it's been there for a while. What it's doing there I have no idea. (If anyone knows, please contact us.)

Alan loved the ferry ride, of course. Boat with a loud engine, kicking up waves, puff puff puffing smoke from its engine? Ooo yes. I kept him on my shoulders, well away from the railing. David charmed a nice old lady from Calarasi.

Oh: Calarasi. I visited Calarasi back in January. Not much has changed. We didn't have time to see the Museum of the Lower Danube, alas -- the kids were getting restless -- but we did take a detour to look at the siderurgical works, which are still huge, and still slowly rotting into rust and nothingness.

We also saw the canal, which I'd missed the first time. Holy smokes. That canal is about 4 kilometers long and over a hundred meters wide. I don't know how deep it is, but still: it was a huge, massive piece of civil engineering. And now that the siderurgical works has closed, it's a canal to nowhere. What were they thinking?

(Has anyone come up for a use for it? Speedboat races? Water-skiing? Fish farm? Right now there's nothing but a very few fishermen dropping lines off the concrete banks.)

Anyhow. It was a good trip, and we'd cheerfully go back again.

Tip for travellers: the Silistra-Calarasi crossing is much less busy than the one at Giurgiu-Ruse. Cheaper, too.

The Meadow and the Road

A bit more about our trip to Bulgaria.

We stopped for a picnic in a meadow by the Danube. By "meadow", I mean a lovely field of green grass, sloping gently down to the river. On our right was a cliff full of swallows nests, with a forest at the top. On our left, a grove of poplars and a little pond. And it was a beautiful day, warm but breezy, with a few fluffy white clouds wandering slowly across a perfectly blue sky, their shadows pacing them across the surface of the great river. A stork skimmed over the shallows and then, a few minutes later, back again, probably looking for frogs. An absolutely perfect setting...

... except for the sheep crap. Wow, was there a lot of sheep crap. We basically had to dance our way down to the water's edge and back. We never did unpack the picnic lunch.

But it was pretty.

There's a (surprisingly good) two-lane road from Ruse to Silistra, but it stays away from the river. So after a while, we turned left onto a smaller road that the map said would bring us right along the water's edge. Which it did; but the map didn't mention that it was mostly unpaved. It had been a dry week, so we were okay, but I wouldn't care to try it after rain.

Still, it was a very pleasant drive. A lovely day. The Romanian side of the Danube is flat and marshy, but the Bulgarian side has hills coming right down to the river, so the road wound gently up and down, presenting interesting new vistas at every turn. It passed through what I'd call second-growth forest -- I'm not sure if that term is meaningful here in Europe -- broken by pastures, vineyards and the occasional sleepy village. There was no other traffic at all, except for the occasional horse- or donkey-drawn farm wagon.

Here and there, at particularly scenic spots, there were remnants of old scenic overlooks. But they'd obviously been abandoned for decades; the benches had rotted away and the forest had grown back up around them.

We did indeed see a cuckoo, perched high atop a pine tree. Heard him first. Wow, they sound just like the clocks ! KOO koo, KOO koo. I never knew.

We were driving so slowly, and the road was so empty, that I took Alan out of the child seat and put him in my lap so he could look around. Man, that was one happy two-year-old.

We could have gone on like that for a long time, but we didn't know what the ferry schedule to Calarasi was like. So after an hour or so, we headed back for the main road.

But it was very nice, and we'd love to go back.

Along the Danube

Saturday we spent at the Danube.

We drove down to Giurgiu, over the Danube to Ruse, then along the river downstream to Silistra, where we caught the ferry to cross back into Romania. Well, to be precise, one does go over the border into Romania about 200 meters before the ferry -- this is where the Danube makes a sharp turn northwards but the border runs roughly straight eastwards.

We saw:

About a dozen storks with nests and all.
One kingfisher.
One cuckoo, who answered back to our "cuckoo" calls.
One little boy falling into the mud along the Danube shore.
Lots of sheep shit.
One cobblestone road that must stem from Roman times.
One Turkish village complete with mosque and a pig dozing by the side of the road (they must not be very orthodox, said Doug).
One ferry that had green stuff growing on it.
One airplane parked in the frontyard of some Communist living blocks in Silistra - for no obvious reason.
One pheasant that nearly hit our car while it swept across the street at eye level.
The eery, crumbling maze of the Calarasi steel works.

A day well spent.

Summer errands

In Germany, nothing summer-related gets done before the so-called "Eisheiligen", the ice saints. In Northern Germany, those are the days of the saints Mamertius, Pankratius, and Servatius on May 11-13. In Southern Germany, it's saints Pankratius, Servatius, Bonifatius on May 12-14. The final mark is "Cold Sophie" on May 15. No delicate flowers are put outside, in case a late frost might harm them. After the ice saints, it's considered safe. Until the ice saints, no one is really surprised by frosts or even the occasional bout of snow.

We are daring and trust the nice weather here in Bucharest. Our orange tree has moved into the courtyard yesterday, and today we got our car tires exchanged -- the winter ones for the summer ones.

I should have done this earlier, I know. But the last switch was such a pain that I kept procrastinating the spring switch. Last fall, I went to a Mitsubishi dealer, the one across from the Selgros. It took them 2 hours (rather, a rather clumsy apprentice took two hours), and they took over 150 Euros from me. Granted, there was an oil change included. Still. An oil change is something I could do in half an hour, provided I have the right equipment and a ditch and the price of the oil itself wasn't so high. It was a very frustrating experience and I couldn't help but think that I got ripped off.

So today, we went to a little "vulcanizer" next to the McDonald's on Buzesti which had been recommended to me by our landlord.

They took 15 minutes, repaired one of the tires which I managed to pierce by driving rather vigorously through some construction, checked the air and the balance (both of which the Mitsubishi garage hadn't bothered with until I asked them to do it), were very friendly, and Alan could stare with open mouth and glazed over eyes to his heart's delight as they worked on the car.

I paid all of 9 Dollars.

Lesson learnt.

I knew it would happen one day

Alan said "Achtung!" for the first time.

(Yes, we're back in Bucharest. More to come.)

Hair!

We're spending a week in Germany with my parents waiting for Doug to come back from the States and then continue on back home together. He'll be in for a surprise when he sees his older son, though.

See, we had one of those classic accidents.

Never mind who didn't pay attention when Alan pointed to the scissors and said "hair!". Never mind that the answer was "yes, you can cut your hair with these".

What really counts is that he looks rather cute with his new very short hair. (And no blood was shed, so that's good.)

Heh. And it wasn't me, OK?

Tagus Aurifer

I recently read a novel in which some of the protagonists awake to a world 1000 years after an apocalypse. They find bits and pieces of architecture but most of human construction has long collapsed. If that novel had been set in Extremadura, I'm sure they would have found the bridge of Alcánatra neatly preserved -- after all, it stands there since 106 AD already.

Alcántara in the very west of the Extremadura is situated on the Tajo river. It's a small town with a monastery and a nice church and a dam nearby, but the biggest attraction is the bridge, no doubt about it.

The bridge is made wholly of granite without the use of mortar. Its length is 616 feet; its width 26 feet. The two middle piers are about 190 feet high, and the two middle arches have a span of 150 feet. The usual depth of the water is 37 feet, but in time of flood it sometimes rises in the narrow gorge to a height of 180 feet." (Note: These dimensions are about: 190 meters long, 60 meters high, and 8 meters wide.) At the south end of the bridge is a small temple to a Roman god.
www.napoleon-series.org

The Roman architect Gaius Julius Lacer designed the bridge which was built mainly by slaves from ca. 98 to 103 AD. In the middle of the bridge there is a little triumph arch to Emperor Trajan. He didn't finance the bridge, though -- that he left to the 11 cities of the province of Lusitania.

Tagus Aurifer, as the Romans called the bridge, outlasted several wars, Arabs and French, and the English attempt to blow it up in 1809 (what's this with the English trying to bomb old things?). They tried but didn't quite manage -- the targeted arch didn't collapse until the following year. It's not quite clear which arch was destroyed -- sources are contradictory and confusing. In 1860, Wellington ordered the bridge to be repaired and apparently they did such a great job that it still cannot be told which of the arches had been damaged in 1807.

The bridge is still in use today, btw. It has traffic across it, trucks and cars and many pedestrians, and the swallows have built their nests inside the arches. The view is amazing, even with the hydroelectric dam one kilometer up the river.

The little temple which is mentioned in the quote is also the funeral place of Gaius Julius Lacer. The inscription on his grave says: "I leave this bridge for all times to the generations of the world."

So far, he's been right about that.

Cáceres

Cáceres (Extremadura, Spain) is a city of a population of 80.000 which is located in the west of the country and which borders on Portugal. The centre of Cáceres consists of an ancient medieval nucleus world-reknowned for the value of its history and heritage, which have earned it the honor of various national and international administrative and institutional recognitions (for example, Historical and Artistic Collection of Monuments as designated by the Spanish Government, World Heritage City as declared by the UNESCO, third best preserved collection of urban monuments in Europe, among others).
Source: Cultural Contact Point

Cáceres is old and rich in history even by European standards. There are traces of stoneage population, the Celts settled here. The Romans founded the city proper in 34 BC, the Arabs took it in the 12th century -- the name "Cáceres" stems from the Arab "Quazri". The city was ruled by monks and Spanish kings, Isabella among them (this is a Lois McMaster Bujold reference, never mind if you don't understand).

As if all this history and culture wasn't enough, it was also Semana Santa during our stay and I tell you, the Cácereños take their religion seriously. The processions with daily altering costumes and barges displaying Jesus on his donkey on Palm Sunday (going downhill from there) and the Virgin Mary in descending stages of mouring are fascinating even for non-Catholics, as my father assured me. The fervor and enthusiasm with which young and old alike walk the rounds several times a day is astounding. I'm sorry that we didn't get to see the Easter Sunday processions which must be fantastic. Thousands of fresh flowers decorate the barges, delicate ornaments made from light deprived palm fronds, armor with the double-headed Habsburg eagle and S.P.Q.R. stamped on them, drums, marching bands, Spanish women wearing mantillas... it's really something.

But that is not all that is to Cáceres. Over the next few days, I'll tell you all about it, and then some. We've also been to Mérida, Guadelupe, Alcántara, and to a real Finca Extremeña. We ate jamón ibérico and merluza. We saw rocks and birds and monasteries. Oh, yes. And there was a wedding.

But, we had a long trip home yesterday - four hours car trip, three hours flight, another two hours car trip. "Siesta" is the word of the day. However, we're back and back online. Hi, everyone.

Forty-Two Storks

I'm not going to blog too much about Caceres, because I was only there for two days. (I'm in New York City now.) Claudia was there for a week, and saw much more than I did. So I'll let her do the travel blogging.

But I do want to mention the storks.

Extremadura, it seems, is one of the major breeding areas for Cicionia ciconia, the European white stork. These magnificent birds spend their winters in Africa, but return to Spain every summer to mate, nest and breed. They build enormous, sloppy nests -- sometimes two meters across and weighing more than a hundred kilograms -- on the tops of trees and tall buildings; they seem to have a particular fondness for old churches.

The people of Caceres are very fond of their storks. (And they should be. The birds are beautiful.) They keep careful track of the number of nests: there are twenty-one of them in the city. Since single storks do not build nests, that means there are twenty-one mated pairs of birds, forty-two storks.

Saturday morning I was out early with Alan and David. We found an open cafe and I drank coffee while Alan ate a croissant. Then we watched a pair of the storks waking up. The plaza where we sat was still dark, but the bird's nest, on the steeple of an old church, was already lit by the rising sun. The storks spread their wings to catch the morning warmth, and bobbed their long heads at each other, weaving their necks back and forth. Then they made their strange call, the rattling cry that sounds just like a stick dragged across a picket fence.

Alan watched all this with great interest. "Big birds!" I said to him, pointing. "Big!" he agreed.

Then one of the storks took off. It circled the old church once, twice. Then it flew out over the plaza, then back, in great graceful arcs, back and forth, gradually rising higher, until it caught a thermal high above the town and headed out for the morning's hunting over the plains.

The stork disappeared into the distance, a speck lost in blue haze. The sun lifted over the tops of the old stone houses and morning sunlight began to pour across the plaza. And after a while we walked back to the hotel.

The pair of storks that lives in the city park of Cáceres.

The Road to the End of Europe

The road to the end of Europe is called the E90. It goes south and west from Madrid, through Castile and Extremadura to Badajoz and the Portuguese border.

(The end of Europe, as everyone knows, is Cabo de San Vicente, in Portugal. That's the farthest you can go to the west, without crossing salt water. And to get to Cabo de San Vicente from pretty much anywhere else in Europe, you have to take the E90.)

What I found interesting about the road to the end of Europe was how American it looked. Western Castile and Extremadura are some of the least densely populated parts of western Europe; once you leave the suburbs of Madrid, there are no big cities and few towns of any size. The land is rather dry and empty; the Castilian part could easily be Oklahoma, and Extremadura looks like Wyoming.

(And the road itself looked and felt like an American highway. It was new, and wide, and not too crowded. Comfortable.)

In Castile, the road stays on a broad flat plateau between two mountain ranges. I hadn't realized what a mountainous country Spain is, but we were never out of sight of the mountains -- big ones, with snow still on their peaks in April. It makes for a drive that is... not beautiful, exactly, the mountains are too far away for that... but impressive. Grand, maybe, is the word.

As we moved into Extremadura, the land gradually got higher and dryer. Although at that particular moment it wasn't actually dry. It was green. Extremadura had been having an unusually cool and wet spring, so there were leaves and flowers everywhere. But if you looked closely, you could see that this wasn't the normal state of affairs. The plants that grew wild by the road might be blooming, but they all had that dryland look, either pulpy or spiky. Trees grew short and far apart. The soil was thin, and here and there the red bones of the earth poked through. It looked like a hard land that just happened to be having a rare good spell.

At about km 180 we stopped at a rest stop by the side of the road. It wasn't a voluntary stop. Rather, it was because Alan -- after an hour and a half of peaceful sleeping -- woke up, and promptly was explosively carsick.

We won't go into detail about this part of the trip, except to say that the rest stop had a rather nice sculpture of storks rising up from a little hill beside it, with the sculpted storks seemingly about to take flight across the highway. I didn't understand the significance of the storks just then. But I would later. We cleaned up as best we could and drove on.

Meanwhile the mountains had reached an arm around to block our path. Or to try. At first the road curved gently away from the heights; but bout 250 km southwest of Madrid, not far from the small town of Trujillo, the E90 suddenly turned and charged the mountains head on. It rose up and then dove down into a 1200 m long tunnel. When it came out, we were in a different country -- still Extremadura, still dry and tough, but higher and a little bit greener. We were close to the Portuguese border here, and the Atlantic, we realized, was just a couple of hundred kilometers away.

The land was still empty, though; few towns, few houses, just great open ranches and occasional flocks of sheep.

At this point we turned off the highway and took the side road to Caceres. We didn't follow the road to the end of Europe -- this time. But we'll be back. Next time, we'll bring a camera. And Dramamine.

Madrid

I fell in love with Madrid. And I haven't even seen much of it yet and won't see much more in the short time that's left before we have to leave for Caceres. But, oh.

Those buildings.

The plazas, which have big, generous fountains in the middles and are lined up like pearls on a string.

The funky neighborhoods. (Of course, we stayed true and ended up in the gay neighborhood of town. How? I booked the hotel through the internet, so there was no way of telling. But we somehow always manage and we always feel right at home, then. We used to live in Dupont Circle in DC, you know.)

The little busy side streets.

The buildings.

The atmosphere.

The buildings.

I'm not sure this impression is correct but it seems that Madrid is a very well done cross between Paris and New York. Actually, coming right out of Romania, the first thing I said to Doug was: "This city is unbelievably rich!"

We have to come back, that's for sure. However, next time maybe we won't do the trip through Frankfurt to save a few bucks. We had 90 minutes to change planes and it was barely enough.

Anyhow. Madrid is gorgeous and we already regret that we have so little time. Next time, is what we console ourselves with. Alan and David think it's cool, too. They love the busy streets and that there is so much to see. But in two hours or so, we are heading to Caceres.

[And I had an idea. I'm going to start a blog solely for traveling parents to share tips where to stay and what to do on the road. Like, is there a child friendly hotel in Madrid? Because ours isn't. It's perfectly nice but it has stairs in odd places and a teensy elevator. Or is there such a source? I'd be interested to know!]