The town of Masaya is a half-hour or so by bus from Granada. It has a justifiable reputation as the folk-art capital of Nicaragua. There is a revitalized downtown market devoted to folk arts and crafts. Every Thursday night there is a "Noche de Verbena" celebration there, with performances. The night we attended, there was some excellent folk dancing. But for the real arts and crafts, we went to the real market by the bus station. An amazing variety, and lots of very nice stuff. On the other side of town, there is a lake between the town and the Volcan Masaya. There is a nice boulevard walkway along the lakefront.