Financial Risk at an Opportune Moment

Here we are, 2012, and mortgage interest rates are at a low we'll probably never see again, 3.5% on thirty years. They're comparable to inflation.  Neither index has anywhere to go but up, especially given our nation's financial foolishness of borrowing, spending, tax-raising, and can-kicking.

Combine low mortgage rates with property prices still shocked and locked from 2008, and a financial risk-taker probably sees this as the prime opportunity to make money off of borrowed money in the romanticized market of real estate.  Land.  They aren't making any more of it. 

Here's the playbook:

• Sign on long term for as much as you can handle to purchase assets whose market price can only go up (or can they?) 
• The funny thing about (fixed) mortgage interest rates- they're fixed for the term of the loan, and the term of the loans are long. 1982 was thirty years ago. Mortgage interest rates were 13-14%. The Clash released Combat Rock. 
• Should I Stay or Should I Go?
• Lock in your costs at today's ridiculously low rates and be a baron down the road.  If your bet is right, you'll be sitting pretty.

What could go wrong?

Ask those who were flipping houses during the 2000-2007 real-estate bubble.  The game was to buy on short term financing, refurb (or not- sometimes the houses appreciated regardless) and flip.  Double down on the next few properties.  Lather, rinse repeat.  And then the bubble burst, leaving the risk-takers with interest-only-balloon and other unique short term loans and properties they couldn't move.  What to do?  It's no fun to declare bankruptcy mid-life and start all over.
 
Debt is funny.

When financing investments it is a risk, a bet that you can beat the cost of financing with your return.  Debt is a time machine getting you what you want now at a fixed additional cost and, well, indebtedness (and opportunity cost) for the future.  Your cash-flow is committed until the investment matures, for better or worse.  What are you risking?  Debt on a dead investment.  If you can't pay that, you're risking savings, retirement money (you do know that you're responsible for your own retirement, don't you?), bankruptcy.

It seems quaint to look back a mere five years (when interest rates were a relatively astronomical 7%) and consider that we defined and justified (let's be honest- rationalized) our homes as investments.  My, how times change.  Today we look at the same loan as what it truly is- a debt to be paid to acquire an asset many are upside-down on and will be for a while.  Despite fortunate refinancing and aggressive principal pay-down, we're still hoping for market prices to float us back to sea.

Does your neighborhood look like this?

Cash (dare we call it capital?), however, is an interesting investment instrument in comparison to a financed investment.

• You can make a wiser call on your investment because, man, you feel the pain of spending that money and will be more cautious than when spending time-machine money.
• If things go wrong, you can weather the storm or, worst case, cut bait at a loss.
• Your cash-flow is not affected; other sources of income (other investments, your wages and earnings, savings) continue to carry you in tough times.
• The assets you purchase with cash are yours.  They are a positive on your balance sheet.

And so here we are.  The cost of the bet is 3.5% per annum.  Indicators are that we're bottomed out, yet the risk is still the same. One thing can go right.  Many things can go wrong.  Are you willing to get caught with financed investments?

Rush was also busy in 1982, and had this to say about the Subdivisions we find ourselves living in today:

Some will sell their dreams for small desires
Or lose the race to rats
Get caught in ticking traps
And start to dream of somewhere
To relax their restless flight
Somewhere out of a memory of lighted streets on quiet nights...

A random and apropos thought from Hayek

When I get the chance, I chip away at F.A. Hayek's "The Road to Serfdom."

When I get the chance: because there's so much to learn, so much to pursue, so much to do.
Chip away: not because it is unclear, but because it is so rich.  A mere paragraph gets my mind wandering and scribbling notes in the captions, then on post-its, then on to full blown writin.

From Chapter 6, "Planning and the Rule of Law"

Where the precise effects of government policy on particular people are known, where the government aims directly at such particular effects, it cannot help knowing these effects, and therefore it cannot be impartial.  It must, of necessity, take sides, impose its valuations upon people and, instead of assisting them in the advancement of their own ends, choose the ends for them.  As soon as the particular effects are foreseen at the time a law is made, it ceases to be a mere instrument to be used by the people and becomes instead an instrument used by the lawgiver upon the people and for his ends.  The state ceases to be a piece of utilitarian machinery intended to help individuals in the fullest development of their individual personality and becomes a "moral" institution - where "moral" is not used in contrast to immoral but describes an institution which imposes on its members its views on all moral questions, whether these views be moral or highly immoral.

Hayek earlier compares this type of law, these specific orders to general rules, genuine laws, where the precise results cannot be foreseen and which are by definition, impartial.

Let's pause, shall we? 

Were you to be concerned with right-wing religious zealots enforcing their morality upon you, you'd certainly see Hayek's point.  But what if you were concerned with left-wing secularists enforcing their morality upon you, such as the HHS mandate for insurance coverage of birth control?  Are these not the same concern?

Are we not becoming a "moral" state?  It seems every crisis or scandal is used for its circumstances to create new regulations and laws to prevent such a crisis, scandal, or wrongdoing from happening again.

Well. There are a lot of circumstances. Butterflies flap their wings in China and hurricanes occur in the Bahamas, you know?

Shall we have regulations for every circumstance where something goes wrong?  If so, the state becomes a moral power rather than a liberal one, where moral laws predetermine what is permissible rather than being a reliable, liberal framework in which possibilities are open for the citizens to pursue, take risk, succeed and fail.

Freedom from failure is not freedom.

Let's continue now and complete Hayek's paragraph, which encapsulates the point of the book- a warning in 1944- a warning in 2012- a warning in all times to those who yearn for freedom and the responsibility that goes with it rather than freedom from responsibility:

In this sense the Nazi or any other collectivist state is "moral" while the liberal state is not.

Here's to freedom.  Here's to classical liberalism. As opposed to, say social liberalism.  Or many of the other isms even Ferris Bueller was wise enough to be concerned about.

Caption contest!

 

I just find this so depressing.  So let's have a little fun with a caption contest.  I'll get you started:

I'm sorry, Mr. and Mrs. Smith, but your little Joey doesn't look like he'll succeed in life.

Nothing good can come from this.

All of zee children vill sit in sssstraight rows, verflucht!

"On the contrary, they adored the Party and everything connected with it. The songs, the processions, the banners, the hiking, the drilling with dummy rifles, the yelling of slogans, the worship of Big Brother -- it was all a sort of glorious game to them." - Orwell

"Points will be deducted if you're late."

Vaneerifying

Tops!

Cut veneer close. Glue it on. Clamp it with a 50 lb bag of sand.  Wait overnight.  Trim it closer.

But why did you paint before gluing on the veneer?  Impatience and overcoming inertia.  And it really doesn't affect the results.

Beware the liquid gluten.

"Just a trim today, sir?"

It won't float away

Interesting clamp.

Yeah!

This has turned out alright

Repeat for the other side.

Bookmatched- and it turned out to be pretty good.

hHeavy

Notice the correct amount of dry vermouth.

Have MartiniThe final results tomorrow.

And in her eyes two sapphires blue

That quote from Wang Chung's 80s hit Dance Hall Days is the only way I can describe the color of project Hamy V.

It had been a week of drying, and I could no longer smell paint when I sniffed the guitar, so over the weekend we took the plunge and started sanding.

We started off gingerly wet sanding with 2000 grit, afraid to sand through the clear coat and into the paint or beyond.  By the end though, I'd developed enough feel and trust that I was giving it some pretty serious elbow grease with a progression of 1000, 1500, and finally 2000 grit to get it as smooth as I could.  Here are the results:

Basically, I did what you do if you spend a late summer afternoon really giving your car a solid detailing. 

First, we clean the paint with a cutting compound, also referred to as a rubbing compound. This buffing-out cut through the haze left by the sanding and revealed a thrilling depth and sparkle.  Most of the videos I've seen of this step had people using orbital sanders and buffers.  I just did it by hand.  I trust my hands more than a high speed device for my first effort. 

Looking very promising

From there, I used a swirl remover/polish and finished off with some wax.  The results are fantastic! 

The neck is unbelievable- deep, smooth color.  My car is the same color and doesn't look this good.

Coming atcha! Look at the reflection on the body.

I learned quite a bit.  You can sand through.  Any imperfection in the surface before you paint will be there after you paint.  Fillers such as wood fillers, bondo, and grain fillers (sometimes epoxy) take care of this. No I know.  I developed a bit of touch and trust in sanding paint. "Rattle-can" results can be stunning.

I just love the neck on this thing.

We exercised patience, research, and some risks, and boy were we rewarded.  Now it's time to start on the front, which is going to be a quilted top lacewood kind of veneer.  It should look fantastic.

Like waiting for paint to dry

Because, well, we're waiting for the paint to dry.

Luster

Hamy V update. 

Shot another four very thin coats of color on top of the sanded undercoats, and then about five thin coats of clear. 

There are many theories about how long to wait between the color coat and the clear coat, usually discussed by the obsessive-compulsive-crowd in terms of weeks.  Well, the cans I had recommended waiting thirty minutes.  So I'm sure we blew their minds by waiting forty-five.

Blue.

Shiny.

The sunlight shows the depth of the color.

Available at your local VIP Parts.

For fine-buffing of the clear coat

We'll wait a while (days? weeks?) for the clear-coat to really dry.  One rule of thumb I've read said that it's dry when it no longer smells like paint.  Makes sense to me. 

We'll wet-sand it with the 2000 grit shown above, then use the car-waxing buffer to bring the shine back.  That should remove the orange-peel like effect and leave a very smooth finish.  I hope.

I've got a piece of maple that I painted and clear-coated alongside the guitar.  We'll use it to experiment with the sanding and buffing.

Oh, and a new guitar day

Slab mahogany body, maple neck with rosewood fretboard.
25" scale cutting the line between Gibson and Fender
Full-bodied yet articulate, snarling P90s
One volume, one tone
Quality hardware
Made in USA
Peavey
Firenza
$102

It needed a clean up

Oops, missing something.  Good thing I have some stock parts in my bins.

Now aint that pretty?  Trans-purple, black P90s, and orange knobs.

"Elf-hat" headstock.  Same concept as the Wolfgang I have.  Straight string pulls, angled, quality Gotoh tuners.

Bridge and tailpiece are embedded in routed slots for a low profile.  Very classy.

Inspected
Cleaned it off
Restrung with 10s
Neck and frets are perfect
Nary a pop or scratch form the pots or switch
Solid, lightweight, balances well.  Very playable sitting and standing
There's something about Peavey and Peavey- through the ValveKing 100 head, pure rawk.

After a week of playing it almost exclusively, I was a bit anxious to pick up one of the Hamers.  Not to worry.  The Hamers (the Daytona, the Special) are entirely different guitars.  But they aren't light years ahead.  That's not an insult to Hamers, by the way, it's one hell of a compliment to Peavey.

This is not the last Peavey I will buy.  They made a version of this model with a humbucker, single, single pickup configuration and a tremelo.  Two other noteworthy Peavey's I'll be watching the usual used sources for:  A Falcon strat-style and a Generation S-3, a Telecaster style with "Nashville" configuraiton single, single, single pickup configuration.

My last two guitar purchases, the Daytona and this Firenza, have totaled $350.  You can't beat that for value.

The finer things

Project Hamy V continues. 

The pearl blue paint has dried over the last few days, and this morning I took some 2000 grit wet-sanding to the splatter on the neck.

One small test led to another larger test and more confidence.  I ended up wet sanding the whole thing, lightly, with progressive 600 to 1500 to 2000, smoothing out all the rough spots.  You can see the dull areas where the sanding had its greatest effect.  Now the surface is, as my friend Bill Huber used to say, "smooth as a baby's bottom," although Bill was referring to his Olde English 300 quart bottle of beer, which he also claimed to taste "like mother's milk." You and I know Olde English 300 is nothing of the sort.

Next up, we'll spray a few more coats of color to get the sparkle back in the finish, and then cover it all with many layers of clear-coat. I figure all this sanding is good practice for when we ultimately have to sand, buff, and polish the clear-coat for the final product. 

We also have to get the veneer glued to the top and trim it close.  My experiments indicate that process will be a pain much like the morning after a little too much Olde English 300.

Hamy V Worship?

It was Christmas 2010 that I gave the Hamy V body to Henry and we've chipped (and filed and sanded and planed) away at it in fits and starts ever since.  Sometimes seasons would pass while the guitar sat in the corner of his room or my office.

The time has come to take the risk of painting it. The worst that can happen is it comes out ugly.

So here goes.  Over the weekend, Henry and I did the last routing of the control panel.



Our operating table

 We masked off the top, the neck, and the headstock.  Do you like the flowers?  We could do some decoupage and shellac them.  :)


The top will get veneer instead of paint



We put up a painting booth in the "mold room."



You see strange things in Maine in winter


We then started spraying with gray Dupli-Color sealer/filler/primer from a rattle can.  It's meant for car refinishing and should do nicely for guitars.  We applied a couple of coats, let them dry overnight, then sanded with 200, then 320.  Two more coats, sanded with 200, 320, then 400.

Sadly, we failed to get a picture of the gray beast.

This afternoon we wiped it down with some rubbing alcohol to get all the dust off of it, took it into the booth, and laid down the color coats:



We covered in many coats.  The can spurted a little on the last coat (dang!) so we may have some wet-sanding and more coats to apply.



Now it's like waiting for paint to dry.  I was shocked at the depth and vibrance of the color.  After we repair the spittle on the neck and add a few more coats, we'll give the paint a week or two to really cure, then cover it with four coats of poly, then wet-sand and buff it up to a polish. 

I don't think it's going to be ugly.  Mrs. Toadroller likes it.

Lots and lots of little projects

I've been having a blast fiddling around on a number of small projects. 

This morning, for example, I fixed a pair of AKG headphones I've had for, gosh, twenty years or more.  This past week, the right earpiece went flaky on me. A quick search on the internet yielded  advice on how to take them apart.  Some fun with the soldering iron and I was back in business:

My brother and sister-in-law sent me a replacement humbucker pickup for my Import Hamer Standard.  Armed with my soldering iron, a bottle of contact cleaner, and an assortment of adjusting wrenches and screwdrivers, I've found the true sound of what was before a dull, if good looking, guitar:

I've been tweaking sound here and there; adjusting pickups, tweaking truss rods, fixing short circuits in wiring, cleaning and setting and re-stringing.  The blue light on the black-box below is a bluetooth receiver lined into my stereo.  Now my phone, my computer, and the iPad can broadcast their sound into the speakers.  Fun!




















Isn't it fun when you've got all your toys arranged "just so"?

Some books I read this year

Here are some quick reviews for some of the books I read this past year.

I've always got a pile of books I'm working on.  I read most fiction to completion; with most research and political/economics/self-improvment, etc., I tear through the first eighty percent and then out it back on the shelf a year or two later.

• T.R. Pearson.  A short History of a Small Place. His first novel with his unique turn of the phrase. It brought back some memories for me as I read it a good fifteen years ago.  Louis Benfield is a sentimental young man.  I felt for his mother and the way Pearson helped her express her grief.
• T.R. Pearson.  Blue Ridge It was a Pearson year.  I'm currently reading Gospel Hour.  Blue Ridge introduces a new setting and new characters.  Sometimes crime-bosses do things with class.
• Hemingway, The Sun Also Rises I read this about twenty years ago.  This time through, I noticed some good writing about three quarters of the way in, but I think for the most part he was phoning this in.  I have, however, realized some acquaintances remind me of Lady Ashley and Jake Barnes.  It also inspired me to search for some YouTube videos of Pamplona's Running of the Bulls.  Oh, that and the use of telegraphs back in the day was very much like texting.  They drank a lot.
• Charles Dickens, A Tale of Two Cities.  Makes me want to avoid Paris.  Politics as usual.  Mobs are bad.  I loved the political intrigue but found the love story formulaic.
• Jack London, The Call of the Wild.  A fun and adventurous read; a view into a place and time most have forgotten.  Told from the dog's perspective. 
• C.S. Lewis Space Trilogy (Out of the Silent Planet, Perelandra, and That Hideous Strength).  I think I read them this year.  I had attempted them a few times in my past but I was frankly just too young.  Perelandra stands out and shows the battle of evil against innocence.  I shall re-read.  That Hideous Strength takes an unexpected and frightening twist into the evil workings of organizations.  You don't want to meet the Head.
• Orwell, 1984.  Speaking of evil workings of organizations... Does listening to an audio book count as reading it?  In my case, 1984 had a profound, depressing, and haunting impact on me.  I'm glad I didn't read it when I was younger.  It is intense and timely today, which I consider to be an Orwellian time with a smiley face drawn on it.  Liberty had better overcome.
• Kazuo Ishiguro, A Pale View of the Hills.  I read The Remains of the Day a long time ago; this has been on the bookshelf teasing me for over a decade.  The main character is confused and troubled by her past and believes it was someone else who did these things.
• Robert Kroese, Mercury Falls and Mercury Rises.  Rob is a humorous and philosophical writer, software developer, and tweeter (is that the right term?) with the initiative to forge his own path towards success in the publishing industry through hard work and determination.  I came across Rob through his humorous website www.mattresspolice.com and have had witty exchanges with him through the years.  Imagine my delight to read his self-promoted and published novels about an angel and a mortal who cut through the heaven and hell's bureaucracies to stave off armageddon.  A few times. Should you enjoy Douglas Adams, Mystery Science Theatre 3000, and non-sequitur style of humor, you'll devour these.  
• Robert Kroese, Self-Publish Your Novel: Lessons from an Indie Publishing Success Story.  Good advice on marketing and creating an audience for your book.
  
• SAP Variant Configuration, from SAP Press.  Hey, you know, professional interest and good bedtime reading.  Knocks you right out.
• Ludvig von Mises, The Anticapitalist Mentality; The Causes of the Economic Crisis.  Economics is not economic policy. Economics is not a weapon.  Economics is the study of Human Action and how it deals with scarce resources.  Economic chains of events, however, are constantly being set in motion ( as a weapon?) through bad economic policy by governments.  Some of those pulling the levers are compassionate, if ignorant; many pulling the levers are sinister and seeking power at the price of liberty to others.  If you find yourself compassionate yet ignorant, these are good books to educate yourself.
• Dr. Thomas Sowell, Basic Economics and The Housing Boom and Bust.  Excellent introductions to economic concepts.  Don't let the size of Basic Economics scare you away.  It is written for all to understand... if only more would read it.  It's also thought provoking in Audio Book form.
• Anna Sewell, Black Beauty.  Like The Call of the Wild; one horse's life from the perspective of the horse.  A happy ending!
• Mark Frost, The Match.  Golf.  A telling of golfing legend and history.  Would that he had spent twice as much time and space on the book, building up the characters and the drama even more.  I recommend "The Greatest Game Ever Played" first.

That's all I can think of for now. 

Carried away

In just about a month, I'll achieve ten full years of owning what I intend to be the last car I ever buy with debt, my 1997 Audi A8.

Funny how a tenth anniversary is a 'tin' anniversary.  The irony.

For its part, it has decided to celebrate the occasion by presenting me with an $800 bill to replace the fuel pump.  The fuel pump is, like many parts on this odd duck of a car, unique.  It's not a $79 fuel pump like those on most cars (Audis included), it's a $900 fuel pump that resides in the gas tank.  I found a used one from a reputable Audi recycler* online for $400.

Here it goes, headed off to the shop.




I've put over 100,000 of the car's 180,000 miles on myself.  It was Audi's flagship technology showcase back in the 1990s when their advertising slogan was Vorsprung durch Technique** (Advancement through Technology).  It's an aluminum bodied and paneled car with a 300hp/300 torque V8 and all wheel drive.  Heated seats and power headrests in the back!  The sticker on it was $65k when it was new in 1997; I picked it up five years later for $18,000 when for the same money I could have had a base Accord with cloth seats and a four cylinder.  Audi, here I come.

If a car is the fashion statement I believe most material items to be, it certainly expresses a lot about me:

• Quality, but at a value price. 
• It is a subtle Q-ship, yet can command some attention.
• It's quirky, sporty, powerful, safe, luxurious and performs best when pushed.
• It works hard until it hits the wall and can't continue.
• It has a lot of good years left in it.
• The glovebox key was never provided, ans so its contents remain a mystery to me, even ten years later.  I'll have to pry it open before it goes to the wrecker.
• It's missing something (a manual transmission.  Oh, nirvana!) to be perfect.  And aren't we all missing something? 
• It's looking a little old, but cleans up nice.

 

It's a great fifteen year old car.  When Hertz deigns to give me a luxury or sport car as a rental, I always enjoy getting back to the A8 when I return home- it compares favorably, even today.

I've spent enough money on it this year to have bought a dependable replacement for it, but am rolling the dice with what I know.  I'm tempted to get another of the same vintage- either as a parts car or as a backup.  But having two or three of the same, older model car in the driveway would reveal another personality trait that I'm maybe just not ready for.

Audi A8, here's to you.  Keep me running for another five years, will you?



*Shokan in NY.  www.shokan.com When I called and placed the order with them, they asked if I'd bought from them before to save some time in the order entry process.  I remembered the name and thought maybe.  When the customer service rep checked the computer, they came up with a shipping address to a company I worked at in 1993.  That's pre world-wide-web stuff, folks.

**If you've ever wondered what Bono is saying in the opening lines to Zooropa, now you know:
"Zooropa...vorsprung durch technik (a step ahead through technology)
Zooropa...be all that you can be"

An outlet for passion

Over the last few years I've discovered how much I enjoy the spotlight.  I'm coming to embrace opportunities to grab it. I enjoy the moment, the responsibility, the execution, and, of course, praise.  The spotlight combines the excitement of risk and passion into a period of time where I, for my audience, am the focus for helping them move forward. 

In my career, I lead the engagement and presentation of software solutions for business problems.  My audiences are business people in executive, leadership, and front-line roles.  I hopefully give them a new perspective and direction in their business roles.

As a coach, I try to create an environment where the athletes learn through experience.  My risk is doing things differently.  My reward is seeing growth of my players talents.  My audience is the parents.  For them, I'm a running color-commentary of the action and, perhaps, confirming to them their children's personality.

As a catechist teaching faith formation to third graders, I hope I'm a witness and a different experience than they encounter in schools and in dealing with other adults in their lives.  The stage is mine and I invite them onto it, extracting some participation by expressing joy and passion for our faith.

There are some challenges that come with the spotlight:

• If you're the type who leads, people will ask you to lead (usually by them taking a giant step backwards when volunteers are asked for).
• Not everyone appreciates the effort that goes into preparing for the stage.  It's easier to critique than create.
• I don't like to share in the effort of creation or the glory of the results.  And since the stage is a production, I want everyone's performance to be great, not merely acceptable.

I know this passion will take me somewhere else.  Will it be writing?  Will it be performance- musical or stage?  Will it be humor?  Keynote presentations?  Why not combine all of the above?

Some good, some bad

Last Friday I picked up a new cell phone from the office, the new Blackberry Bold Touch 9930.  Fancy it is; probably the best that RIM has to offer and an impressive stat sheet it has:

• 1.2ghz processor and tons of RAM
• 8 gb built in storage with a slot for my 32gb micro sd card (for holding music and podcasts, you know)
• touchscreen and a very nice feeling blackberry keyboard
• every kind of radio you can imagine- blue tooth, wifi, cell, gps... it even has a compass built in.

So far, it's been intuitive for a Blackberry user to adopt.  It just seems right.  you touch the screen when you think you should; you use the buttons and keyboard when you think you should.

The real good, though, was when I did my corporate enterprise activation.  They sent me an email with simple directions (go to the device, this icon, this menu, enter this and hit go) and golly, it worked.  Down came my contacts, calendar, email, everything else.  My ringtones and apps even carried over.  Impressive!

And then I ported my phone number to the new device (the company had me switch from T-Mobile to Verizon, which I'm not going to complain about here in the woods of Maine.  What does a German company care about the woods of Maine?  They gave me simpler instructions- dial this number, hit 1.  I did it, the kind computer recording on the end asked me to listen to a voicemail setup public service announcement while my number was moved.  When the ad was over, my phone had been switched.

Like that.  Apple couldn't have done any better.

I'm already impressed with the hardware and utility of the phone, let's see how it survives real life where we live off the things.

The bad:

Now my BlackBerry Desktop software  won't recognize or connect with the device.  I've tried a few different things, connecting, disconnecting.  It had worked well before the enterprise activation, but now- no connection.  I'll have to go through the usual PC rituals- rebooting, different cables, uninstalling.  Crap.

Update twenty minutes later:  I re-installed the Blackberry Desktop Software (not to be confused with the Blackberry Device Manager or the Blackberry Desktop Manager or the Blackberry Device Desktop) and it found my phone on start up.  The media sync wonked out when I tried it, but when I when to the applications, it started synching the music to the device.  Sloooooowly.  I don't mind, as long as it gets there.  I've got all night.

A mentor

In the summers somewhere around my freshman and sophomore years of college, I did building maintenance work in the Jefferson mill building in Manchester, NH.  If you've driven through Manchester and past its mile of century-old textile mill buildings along the Amoskeag river, you've seen it.  The Jefferson is the one with the clock.


My father worked for a technology company that occupied the third floor of the Jefferson through the 80s and 90s.  I'd sleep on the ride in with him in the mornings, labor through the day, and sleep on the ride home.
I'd paint, fix plumbing, sweep, repair windows, put down baseboard, sweep, sweep, sweep; you name it.

One week they had me remove the side sashes from all the windows on the fourth floor, cut the pull ropes for the granite window weights, and stack the removed weights on a kart. At the end of the week, I rolled that cart into a dark, damp corner of the basement where I'm sure it still rests.

I developed my skills of "driving" the light-duty internal freight elevator.  'Old Pete' taught me how to operate its rope controls and time its motion to stop even with the floor.  We once had a repair to make and Old Pete took me into the control room at the top with a special tool box.  The six inch leather belt that ran from the General Electric motor (I looked at the manufacturer's plate on the motor: 1928) to the gears and steel cables that drove the elevator had torn, so we had to graft on a fresh section of leather.  The tools were as specialized as the skill, and I'd doubt there are too many left anywhere that could repair such a mechanism without having to research first. 

Old Pete added to my understanding of how to do things.  He was a mentor.  He was probably all of 68 at the time, but to a green 18 year old that's pretty ancient and he had my respect.

Old Pete taught me how to paint.  "Hold the brush close, like a pencil, not way at the end of the handle.  It'll keep your hand from getting tired and give you more control," he said.  "Get some paint on your brush.  You can't paint with a dry brush," he explained.  "When you roll, use a dowel.  And all the way up and down; cover well and smooth, or you'll leave racing stripes."  I've used his advice on every wall I've painted.   "See these windows?" he asked, sweeping his arm, indicating the interior wall that was fully window paned and which marked off the maintenance headquarters in the basement of the mill building, "this week you're going to learn how to cut trim."  It was Mr. Myagi and 'paint the fence.' from The Karate Kid.  I can cut and glaze a window like nobody's business.

During a hot week in August, Old Pete and I headed to the boiler room to clean the boiler tubes.  "You might want to wear shorts tomorrow."  He directed, I labored.  Hose the tubes down.  Ram the steel brushes in. Push and pull to scrub.  Pull them back out.  Sweat.  Next tube.  I don't remember how many tubes there were, but they were a good five inches in diameter and probably fifteen to twenty feet long.

Old Pete was a veteran of WWII; served in the Pacific if I remember correctly.  Told a very occasional story but mostly said "Ah, war is hell, war is hell."  On Fridays, my boss Stan would start the litany:
  - Pickin' up some beer on the way home, Pete?
  - Not beer, Michelob.
  - What are you doing this weekend, Pete?
  - Painting another room for my wife.
  - See you Monday, Pete.

My father said Pete came with the building when his company came in; jested that Pete might have been there from the beginning.  I wouldn't be surprised to come across him today, sitting on that cart of window weights, enjoying not a beer, but a Michelob.

There is a fascinating book, "Amoskeag" made from numerous interviews conducted in the late 1970s, that documents the establishment, rise, and decline of the industry and mills from the memories of employees all along the chain, from dye workers to management.  They didn't talk with Old Pete, but as I read stories from old foremen, from laborers, from those that lived in the row houses up the hill to Elm Street, or those who were on the Franco-Canadien West Side, I couldn't help but think of Old Pete, and what a long portion of those mill buildings's history he was.

Rainy day scramble

It's October in Maine and that brings a dichotomy to the weather.  It's either a beautiful clear day (yesterday) or endless drizzle (today).

This morning, my ears slowly became awake to the gentle patter of rain on the trees and the "shhhhhhhh" of wet streets in as cars rolled slowly passed. 

I've cancelled the soccer games once again.  I'd rather not; it's 45 minutes of emails and phone calls and clarifications.  Oh, and being communications moderator between divorced parents.

The coffee is hot.
The weekend is young.
There are chores to do. 
...
But the writing is done.

Who wants to be a millionaire, anyway?

You know, it generally takes a long time to be a millionaire.

Granted, we all have visions of sugarplums danced before our eyes in the form of rock stars, celebrities, athletes, business tycoons who were in the right place at the right time, even lottery winners.  But in general, it takes a long time to achieve that measure of wealthy we think a millionaire to be.

Is this news to you?  Do you know that you have the opportunity to become, over time, a millionaire? To become wealthy?

If you don't believe its possible, you probably assume that these millionaires are beyond you; that they have something you can't; that they must have somehow oppressed others to achieve this impossible dream.

So here's how to be come a millionaire:

1. Don't spend all of your money.  
1. I'm not being flippant here, just pointing out that if you don't eat all your candy on Halloween night, you'll still have some the next morning.
2. Something to think about:  your current net worth is the sum total of all your adulthood's financial decisions and a fair judgement of their wisdom.  So add up the value of what you have and subtract what you owe and post that number on the fridge as a reminder.  I do hope it's a positive number.
2. Save what you don't spend.  
1. You've heard the phrase "pay yourself first." Savings gain a momentum through a combination of regular investing, return (growth) and time.  You can control the regular investments and the time.  Do it early and do it often.
2. Investment growth is the opposite of debt growth.  Multiply out a mortgage payment by the number of years on the mortgage and you'll see that the price of the house is much more than the mortgage amount. 
3. Have the discipline to say no.  It's not easy to deny yourself something that you can have just by signing up for a payment on it.  As I've detailed elsewhere, a brand new, inexpensive car at age eighteen will end up costing you about a million dollars. Huh.  A million just sitting there in a fancy Honda Civic.
4. Stay the course for thirty or forty years.  You know, throughout your working career.
1. Did you know you're responsible for your own retirement?
2. Did you know that you should retire when you can afford to, not when you decide to?

Ding! You're a millionaire.  Did you oppress someone along the way, you greedy bastard?

Who are these millionaires?  Most millionaires are at the far end of this 30-40 year cycle.  They followed this plan of not spending all they had, of investing (and investing more as their incomes grew- which also tends to happen as you get older), of staying the course for a long time.

In other words, most of the millionaires are old people.  They saved this money so that they would have something to live on when they stopped earning an income.  They took care of themselves so they wouldn't be a drain on society.  You can do the same.

Two-edged Swords

In business, the investors (be that one person with an idea and some capital, or you and I as stockholders) take the risk towards a reward. 

If the venture fails, it is the investors who lose. This is the risk.  If the venture succeeds, it is the investors who gain. This is the reward.

How to reduce the risk and maximize the reward?  Two-edged swords:

• Succeed.
• Success can and should be achieved through honest, hard, even clever work.  Success can and should be honorable, and is even more so when the odds are against you, i.e., on an uneven playing field.
• Success can and shouldn't be achieved by, well, poor sportsmanship, though the opportunity is there and is often taken.  Let's agree to call this greed, as that's a favorite term for those who succeed.
• Spread the risk to more investors
• It is wise to increase the number of baskets in which you place your eggs.  As long as there is a reward for these risk takers, and as long as this risk taking is voluntary.
• If you've spread the risk to those without a reward, to those without a choice, who loses if the venture fails?  What diluted risk is there to those who have spread the risk.  Has the venture...
• Gained enough mass (traction and momentum) to perpetuate?
• Is it profitable, growing, thinking strategically, spending wisely, re-investing, re-inventing?
• ...or has it become "too big to fail?" Momentum and mass are impressive, but removing the risk removes the incentive to succeed.  It removes the opportunity for that which needs to die to die.  It stifles the market mechanism of...
• Competition, which
• creates new jobs, creates advances, innovates, destroys those ventures which fail to respond.
• or, competition can be met by blocking it through various barriers to entry through regulations, cartels, and monopolist behaviors. It is interesting to note that most cartels and monopolies are formed with the collusion of government.. they are established and defended where a free market cartel and monopoly will not stand.  Ask Kodak, Pan Am, TWA, AT&T, and numerous other monopolies which have tumbled due to fierce competition and sloth.

Each has a virtuous path and each has a temptation to a shortcut. 

The virtuous path is the best of what capitalism has to offer, growth and income, risk (responsibility) in the hands of those who would gain the rewards. 

The tempting path leads to market distortions, such as false investment, a lack of concern for risk in investing, public bailouts of concerns which should fail, resulting in stifled and genuinely unfair competition, a lack of responsibility, slowed emergence of better goods to the market, and a dependency and complacency of the worker rather than an independence of responsibility.

But what about that worker?  What is his risk?  What is her reward?  What are their opportunities?

I hope to think more tomorrow.

A walk in the woods.

A rather gung-ho CEO of a rather aggressive software concern I used to work for had an interesting turn of phrase for things he considered a waste of time.

"A walk in the woods."  As in, "I'm not out here, doing this, for a walk in the woods."

While he was being witty and even charming, with his nebulous English colonial accent,* I have to disagree.  Most times, a walk in the woods is a good thing.  It's a chance to get some thinking done and set your thinking straight as you wander down a trail, stepping over fallen logs, avoiding mud, and just pausing once in a while to admire trees and rock walls.

I'll often step off the trails, forged long ago by earlier land-owners, farmers, even snow-mobile clubs, and wander until I come across something: a rock wall, a road, another trail, some rusted junk.  Today I scared a deer and watched its white tail bound from me.  I'm no woodsman and I couldn't have tracked a deer if I wanted to, so that was just plain luck.

I'll ride the trails a few times a year on my mountain bike.  I intend to return with a chainsaw and clear fallen trunks from the path.  Come winter, the snow-mobile clubs have cleared and even grated the trails for me, and so I do a few runs on my cross country skis.

I wish I would force myself out more.  I do it for a walk in the woods.

This is some of what I saw today:



*Was he Scottish?  South African? A Kiwi?  I can't recall.  I'm developing a theory that presenters, be they sales people, actors, comedians, or the guy escorting you out of the fancy restaurant for being a drunken jerk... all have instantaneous credibility if they happen to have some English derivative accent.  I'm considering adopting one in my professional role as a technical sales engineer.