Why the media is driving you crazy (with all the Tom Cruise and Tommy Chong you can eat, but only in Wisconsin)

“You rang?” – The Addams Family

tom cruise2

You can see Hollywood® height in action here.  In reality, Tom Cruise is only four inches (like 10 centimeters) tall!  He’s a pocket celebrity!

One criticism I have of the media is that it sets an expectation of the way the world should be.  The media does this in a silly way:  single girls in New York City own 3,000 square foot apartments and work as flunkies at the local ad agency as the wacky receptionist.  The media indicates that Tom Cruise is 6’2” (37 meters) tall, even though we have pictures to prove that Tom Cruise fits as carry-on luggage in a 737.

tomcruise

So, Tom Cruise is shorter than the average height of a 3rd grade girls’ basketball team.  Doesn’t matter, they haven’t carded him since 2015!

The biggest bias, however is that of the news writers, Internet publishers and national broadcasters.  Every piece of news is advocacy.  How can I justify this bold statement?  Besides the incredible mixture of Pinot Noir and steroids flowing through my veins, only awaiting the caffeine as the activator chemical, I offer this bit of evidence:

When The Mrs. was involved in news broadcasting, she selected the stories that would be covered in the broadcast.  And, since The Mrs. didn’t like the NBA®, NBA™ news never made it to the broadcast.  Never.  Michael Jordan might have had LeBron James’ love child in a Swiss robot factory with Larry Bird as the godfather and she wouldn’t have broadcast it.  Instead?  The Mrs. inserted stories about a sport she did like, NHL™ hockey, even though there wasn’t a professional hockey team within a ten hour drive from where the broadcasts originated, and ice had to be imported from Utah, which, strangely forbade that the ice be properly mixed with bourbon.

Even though the stories themselves were without bias, the selection of the stories wasn’t.  Although the topic The Mrs. didn’t wish to cover was (and is) exceedingly trivial, it sank home with me:  the gatekeepers choose the stories and the narratives.  The gatekeepers do so with the express purpose of furthering their viewpoint and silencing dissenting evidence.  And even though much of the news today has a significant bias in straight news reporting, it’s the stories that you never hear that also contribute to that bias.

How bad is the bias?  Only 7% of journalists are Republican.  You can simply view election night footage from the 2016 presidential election to verify that.  And, I think much of the street-level misbehavior in recent days has been a reaction to the increasingly polarized news.  Much of the news media we used to consume in the past was locally sourced and sustainable and gluten-free.  It was the town newspaper, which could be had in most small towns and was run by the local boy who decided that ink was in his veins and he wanted to put a daily out to the locals.  Heck, even a hamlet of 1100 people had a newspaper that had an 80 year history in my memory.  It was a small paper, but everyone got it.

The values that the local newspaper editor/publisher/journalist/typesetter put in the paper mirrored the local values for over 200 years.  These values were always tempered and supplemented with news from outside the small town – the town didn’t exist in a vacuum.

Now many of those papers have vanished, and others have long since stopped being the local source for in-depth news.  You read the local paper to figure out who won the softball game, and which kid was on (or not on) the honor roll.

What’s replaced it?  Television and news via the internet.

Where does television come from?  New York and Los Angeles are the two big metropolitan areas that are the headquarters for the major broadcasters.  And the internet?  It’s got San Francisco, New York, Los Angeles and Seattle as the hubs for the major news operations.  None of the major locations that now serve the majority of news to Americans is on the right – each of these cities is exceptionally far left.  I know it doesn’t seem that way to those of you that live there, but, good heavens, those governments have more regulations than the old Soviet Union (even though I just made that fact up, I’m pretty sure it’s true – I heard that Stalin® was arrested in Seattle for trying to open a lemonade stand – too capitalist.  Plus Stalin™ couldn’t prove the lemons were free range, vegan, locally sourced, and carbon neutral.  He claimed Lenin© ate that paperwork.  Stupid Lenin®.

And thus, when Donald Trump was elected president, through the process as outlined in the Constitution and followed since George Washington was drinking brandy by the fire at Mt. Vernon with the Hooters® girls, calls immediately came to “restore our democracy.”  People took to the streets to protest a president before he had been inaugurated – and immediate calls for his impeachment went out.

Why?

The left had been living in a lie, sort of like the mirror the Kardashians® keep on their wall.  In this world, Donald Trump is a monster – all of their media, all of their news told them so (just like they said the same things about George W. Bush™, who is now totes okay).  Trump was not a political opponent with a set of positions that were backed by millions and millions of decent, smart, hardworking Americans.  No.  He was an evil villain who wants to eat children and send them to his hellish pits under the Earth to mine for Trumpenite, a substance known to cause really unusual hair.  However, per my last count, he has eaten no children, nor put any into concentration camps (despite what the media might say, and they told me the Arctic would be ice free by 2014, so, you know, my trust level is low).

But no one who reads this will be able to do a thing about it until November, 2020.

The media frenzy against all things Trump, the bias, has whipped millions of normally sane people into a rabid frenzy to the point that they defend Haiti as a great place to send their toddlers out to play in the streets, point out that MS-13 murderers are probably great neighbors as long as they don’t move to the suburbs, and come to the conclusion that Kim Jong-Un either is awesome or such an evil genius that he blew up his own nuclear facility just to prove that he didn’t need nuclear weapons to have nuclear weapons.  Or something.

And this is the point of this blog – the inability to deal with reality is just . . . unhealthy.

Take a deep breath, if you’re on the left.  Step back.  Trump has done something you like.   Admit it.  It’s out there.

It’s also a paradox – standards and expectations are necessary for excellence in anything.  There must be a burning desire to turn “what is” into “what could be.”  But when that same desire is thwarted because no reasonable action will make any difference, the matter is beyond your control.  This leads to the profound sense of helpless misery that many on the left are feeling about the election (that happened in 2016!) – and that many on the right are feeling about, say, Robert Mueller®, who starred in the 1960’s comedy series The Addams Family as Lurch©, the butler.

mueller

Is it just me, but shouldn’t he say this every single time he testifies at Congress?

And not one person who reads this can do anything about Mueller, either.

And not one person who this who is in a frenzy about either Trump or Mueller is at all healthy.

I’ve written about this before in The Coming Civil War (United States), Cool Maps, and Uncomfortable Truths and I think it’s tearing us apart even faster than I had originally thought.  I try not to take sides, but the left has really inflamed this situation to a point of incivility worse than any episode I’ve ever seen of The Big Bang Theory (spoiler, I only saw one, and it was awful).

All of this brings me back to The Mrs.:  If I come home and have the expectation that she’s arranged my PEZ® dispensers into the outline of the Danish coastline like I asked her to do, and find out she hasn’t, I have four choices:

  • Get as angry as a liberal restaurant owner at Sarah Huckabee Sanders, or
  • Appoint a special counsel to investigate her, or
  • Riot in the streets that Denmark is really a part of Germany, and should be open to all Germans, or
  • Don’t care and do it myself.

I assure you that I’m a last bullet point kind of guy.  Earlier in my life, I might have had higher expectations, but then I realized – if The Mrs. has a hot meal ready for me when I get home, I should be grateful.  I should say thanks.  If she doesn’t, I know where the fridge is, and there’s probably a good reason we don’t have dinner ready.  Or not.  If I let myself get as twisted as Bill Clinton’s lingerie collection, well, I’ll be unhappy AND hungry AND have thong marks on my butt until they bury me in 40 years or so.

So, I don’t have that expectation.  I have the expectations that The Mrs. is faithful, holds our family relationship as at least her number two priority in life (there has to be room for a higher entity, and I don’t mean Tommy Chong), and that The Mrs. flushes the toilet so I can pretend The Mrs. doesn’t poop.  The Mrs. meets those criteria, so everything else is groovy.

chong

I loved these Cheech and Chong when I was a kid.  As I understand it Tommy Chong’s toenail clippings are considered a controlled substance in every state except Wisconsin.

One amazingly significant source of frustrations for people is looking and the world, and seeing it as . . . wrong.  If there’s a solution or something you can do to change it, then work to change it.  If there’s nothing you can do to change it, it just is a fact.  So, relax.  Breathe deep.  You can make it.  And remember to vote on the first Wednesday in November of 2020!

THIS IS NOT POLITICAL, HEALTH, OR VOTING INFORMATION.  Seriously.  How could you think that?

2018 Predictions – Second Quarter Review

“You want a prediction about the weather, you’re asking the wrong Phil. I’ll give you a weather prediction: It’s gonna be cold, it’s gonna be grey, and it’s gonna last for the rest of your life.” – Groundhog Day

peakoil

Yeah, I guess this might have been wrong, since I now bathe in gasoline since it’s cheaper than bottled water or milk.

Okay, in an experiment in economic forecasting, I decided to do some financial predictions for 2018 (2018 Predictions – Wealth).  Why?  It seems like it’s what bloggers do:  they predict things poorly, and I decided I could do that poorly.  Even more poorly than television forecasters, but that’s hard – they don’t put what they say into print, so they change it every week.

I also promised a quarterly report card, and this is the second one.  So how are my predictions matching with reality?

Mixed bag.  One real stinker, the rest are still possible, at least in several games of Fallout™ that Pugsley has played.  Fallout© is just like real life, right?

fallout

But please note that when I explain what I think happened, I’m not trying some sort of argument to the effect of:  “I would have been right, but . . .” followed by some lame excuse.  No.  If I was wrong, I was wrong (to date, the year isn’t done, remember?) but much like a goldfish, I do have the ability to learn.

Oh, what were we talking about?  Fish flakes?  No.  Bitcoin.  Which might be worth less than fish flakes.

kelvin prediction

Bitcoin

Bitcoin is on life support, and a lawsuit has been filed in district court to let this prediction die, but this was overruled by the 9th Circuit Court of Appeals (which also recently ruled that Kim Jong Un *must* restart his nuclear program, and, in general do stuff to prove Democrats Were Right All Along).  It is by far my worst prediction.  It has all of the risks shown below:

  • It (may) be vulnerable to hacking since it’s based on an NSA product – there may be hidden back doors. Or, the NSA might just hack your computer and steal all your Bitcoin that way.  It’s like doing taxes, but you don’t have to file.
  • Wal-Mart® doesn’t take it.   How many Bitcoin for that Chinese made grill?  Nobody knows.
  • It’s as volatile as a bi-polar ex-wife on meth. It looks more promising than Johnny Depp’s career.
  • The IRS has categorized each Bitcoin transaction as a taxable event.   Nobody keeps those kinds of records, and that is an absolute block for people wanting to use it like you’d use a dollar bill.  That moves it from a currency to an investment vehicle.  Use as a currency inherently raises the value of Bitcoin, but this moves it away from that.

My prediction in December:

“I think it might have more to fall before it becomes stabilized, maybe to $10,000.  But I predict it would be higher than $20,000 next December.” (June 2018 John Wilder says:  “December John Wilder was not stoned.  But that at least would have been a good excuse for this stupid prediction.”)

Second Quarter Scorecard:

How’s that working so far?  In the first quarter, it was bouncing around my $10,000 prediction for the stabilization number.  Now?  $6,000.  Ugly.  And there’s no reason it can’t drop more.

katyperry

Is $20,000 still possible?  Yes.  And Katy Perry© might win the Nobel® Prize in physics.

The Stock Market

In December I said:  “The biggest risks are North Korea, Iran, and Saudi Arabia, with anything that created higher oil prices being the biggest risk.  Chances of impeachment this year?  Nearly zero.”  To show you how much the world has moved on, I struck out all of the things that didn’t go wrong this year.  Things are, generally, going very well indeed.

New Risks Since December Prediction

  • Democrats taking the House of Representatives in November – this is a risk because it greatly increases political uncertainty. That’s a huge risk the market has not priced in.  October will be the most volatile month this year, if the Republicans keep the House.  If they lose the house – November will be a very difficult month in the Market.  But if Pelosi keeps talking Trump keeps Trumping – the Republicans have nothing to fear.
  • How much will the Fed increase interest rates (see below)?
  • Is Facebook® in trouble for data? Facebookâ„¢ might be the spark that melts the market down . . . or not.

2018 Prediction on the S&P 500:

“Up.  Not 24%.  But up, say, 10%.  2019?  We’ll see.”

Second Quarter Scorecard:

So far, year to date, it’s now down 1.8%.  No real problem there – it can still easily hit my 10% mark.  And if the Republicans win bigly in November?  10% is an easy achievement.  This tale will be told in October and November, I think.

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Interest Rates:

We’re recovering from the longest period of low interest rates in history.  All of history.  It really won’t make a difference, but the Federal Reserve simply must increase rates so that we can pretend that the money isn’t all made up.  Eventually if there’s a credible alternative (Bitcoin? Swiss Francs?) the Federal Reserve will have to raise interest rates . . . a lot.

If it’s too much this year, we’ll enter a recession – maybe right away.  I don’t think that’s likely in 2018.  Trump’s Fed chair will want to raise the rates – after this election.  Maybe right after, so the economic pain is over and done with by the 2020 election.

2018 Prediction on the Federal Reserve Rate:

“Up slightly.  Eventually (2019, 2020?) up a lot.”

Second Quarter Scorecard:

The Fed funds rate has gone up, 0.25% and will likely go up more.  If that doesn’t sound like much, you’re wrong – it went up from 1.75% to 2.0%.  That’s increasing rates by 14%, and it’s nearly certain the Fed will increase rates two or three more times this year.

Mortgage rates have gone up from 3.95% to 4.52%.  Not a lot, but there will be more to come . . .   Seems in line with my prediction (so far).

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Gold/Silver:

2018 Prediction on the Gold/Silver:

“Meh.  Wanders back and forth.  Probably ends the year +/-10% of where it started.  2019 or 2020 might be different stories, and longer term it will still experience huge upward swings during times of uncertainty.  It appears we’re currently at the “no crisis” pricing, which would probably be a good time to stock up.”

Second Quarter Scorecard:

Gold is down 0.4% for the year.  Silver is up 2%.  It’s wandering (for now), so it’s in line with predictions.

Please note that when a stock market crisis hits (not if, but when) ALL asset classes will drop in price (except for food and ammo).  That’s generally a great time to buy gold.  If it’s an inflationary spike?  Yeah, you’ll be too late for the party – people will dump dollars to buy commodities like gold.

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Disclaimer:  I haven’t started any positions in anything above the last three days and don’t expect to start any in the next three.  So there, neener, neenter.  Also, I’m not a decent financial advisor, and this set of “predictions” is probably as good as Katy Perry’s kitchen whiteboard for predicting the future and probably worse than flipping a coin.

Scadenfreude – You can feel great I forgot to put a post title on this post for 18 hours.

“So don’t go anywhere, folks. The Schadenfreude is about to begin.” – Dodgeball

monkschadenfreude

Wikipedia chose Return to the Convent, by Eduardo Zamacois y Zabala, 1868 to symbolize schadenfreude.  Good choice.  There’s no better source of humor than monks.  Oh, I meant clowns.  Wait, both of those things are scary.  And have odd hair.

The German language is delightful, if you think delightful is a sound that people make when they are angry and choking.  But the Germans have some amazing words – kummerspeck – literally “grief bacon” which means the weight you gain because you eat too much when you’re sad.  Another good one is treppenwitz – literally “staircase joke” which the feeling you get when you’ve figured out the perfect thing to say in the argument.  The argument that already ended.

But the Germans also have a much more common word – schadenfreude.  Schadenfreude is feeling happy when something bad happens to someone you don’t like.  How awful, right?  Well, one day I had the biggest single case of schadenfreude that I’ve ever had, and it didn’t involve something embarrassing happening to Tom Brady, like him breaking his leg after he slipped in his hair gel in the shower and having accidently lost all of his money so now he’s an Über driver that’s taken up smoking.  Yeah, that would make me happy inside.

But my case was totally Brady-free.

Some background:  I had worked with a person that was uniquely difficult to work with.  I won’t bore you with the details, but this person wreaked havoc across multiple departments – including mine.  Sadly, in the blind thrashing around, that passed for “work” that this person did, well, more than one person was set up to take the fall for the odd behavior.  I’m keeping the details vague, because it really doesn’t matter – and if you’ve spent more than five or so years working, it’s nearly certain you worked with an idiot someone like this.

dilbert-schadenfreude

Heh heh – Scott Adams should be knighted.  But first, we need a King . . . maybe King

One happy morning, I heard that they had been escorted from the building.  I felt schadenfreude in abundance.  While working out on the treadmill that day, I just listened to Mack the Knife on a loop.  Why Mack the Knife?  Dunno.  It felt right.

It’s a good song, even though the first time I heard it was in 2007.  Thanks, YouTube!

Part of my schadenfreude that day was a sense of justice – this person had personally made life difficult for several of my friends.  And for me.  Even though getting fired was hard for that person to go through, the entire company was better off now that they were gone.

But, even though I’d like to engage in more schadenfreude (it’s fun to enjoy the pain of others and sniff the sweet, sweet smell of their tears), I try to avoid it.  Why?

Karma.  Treat a person badly, and it comes back to you, with interest.  Maybe not from the same person, but I do think there is a balance in the universe.  Unless that person has wronged you – so watching Charlie Sheen implode wasn’t any fun – he’d never wronged me.

Long-term readers will know Johnny Depp has been the source of several good-natured jokes on this blog – but Johnny’s never done me wrong.  So, here’s an open letter to Johnny Depp:

Dear Mr. Depp:

I really enjoyed your work in Fear and Loathing in Las Vegas and Dead Man.  I also recently read the relatively unflattering recent story in Rolling Stone (Link).  If you want to invite me to drink outrageously expensive wine and hang out with you, I assure you that I will post on this blog a true and fair accounting of the kick-butt time I’m sure we’d have.  Do you have any tobacco?

Sincerely,

John Wilder – Noted Internet Humorist

So, see, I’m trying to make amends.

It’s bad enough that I now have fernweh.  That’s German for “distance-pain” – sort of the opposite of homesickness.  I can only imagine the awesome wine that Depp has – so I get fernweh waiting for his private jet to come pick me up.  I imagine this would be more fun than that weekend I spent with Mickey Rourke, who mainly spent it eating cabbage, not showering, and watching old VHS recordings of The Price Is Right.

CPAP – Three Week Review, Plus Chainsaw Hands. Because Everyone Wants Chainsaw Hands.

“I heard Sutler’s going to make a public statement tonight . . . It’s nearly time.  The masks were ingenious.  It was strange to suddenly see your face everywhere.” – V for Vendetta

guymask

Oh, my, this is sexy!  It’s either a Halloween costume or . . . a CPAP mask.  I wish my CPAP mask was this cool.  Then I could take over Britain.  But I guess I’d have to get in line . . .   Photo credit – somewhere on the internet.

Okay, I promise I won’t keep going on and on about the Continuous Positive Air Pressure (CPAP) breathing device – this is just a three week (and likely final) review of the device unless something significant comes up.  My first post on this is here (Sleep Apnea, CPAP, and how the Medical Mafia is Killing You).

First comment:

The name.  CPAP.  I just sounds . . . icky.   I think it might be the “pap” part.  “Pap” is defined as a soft food for infants, a “Pap” smear is a woman’s parts test that I don’t want to even know about, “pap” is also defined as “nonsense,” and “pap” is also South African slang for “spineless and without character.”

No, a really bad name.  I, John Wilder, suggest that in its place we call it “life-giving energy machine.”  Heck, even something more specific like “Sleep Suffocation Harm Reduction And Care” is better, and has a much cooler acronym – SSHARC.  Shark.  That sounds cool, like something you could tattoo on your bicep (ladies, you could just put the SSHARC . . . nowhere – iffin’ you’re a lady, you don’t get a tat).    And it’s true:  untreated sleep apnea can cause a host of problems like arrhythmia (which leads to stroke), heart failure, diabetes, and that little rash under your wristwatch band if you wear it all the time.

Next:  The machine is quiet.  I half expected it to sound like Darth Vader was on my bedside table, but it was not at all loud – I think the dwarves (Tolkien dwarves from the underworld, not little people) we keep in the closet make a lot more noise, especially when they nip into the mead.  I can’t even hear it at all unless I open my mouth.  To sleep with a CPAP, you have to have your mouth closed.  Totally closed.  The air pressure is jammed into your nose, so that when you inhale, your throat can’t close up (which makes the snoring sound).  When I open my mouth with the CPAP on, I get the (really weird) feeling of exhaling through my mouth without moving my lungs.  Weird.  It also makes a “whooshing” sound, like the end of Quentin Tarantino’s career.

I slept through the night the first time I used my CPAP.  No issues.  I’ve checked the readings, and the number of sleep apneas I’m having is now . . . zero.  And the number of times I breathe shallowly during the night (hypopnea) is one or two.  This is considered super-human.  So that means I’m a man-machine now?  Maybe.  I can crush cans with my machine hands.  Oh, wait, they’re regular hands – and the cans are aluminum, so they’re easy to crush.  Maybe my doctor will prescribe chainsaw hands?  Yeah.

chansawhands

If we all had chainsaw hands, then almost 18,000 chainsaw injuries to the hands could have been stopped in 1994!  Call your congressman NOW to demand that all hands be replaced with chainsaws today.  And that we develop time machines so people in 1994 can be saved from chainsaw related head trauma. 

For those that SSHARC (or, CPAP, if you must) has helped, it becomes a near-obsession.  Most fanatics won’t go a single night without CPAP – or even a single nap.  I have noticed that my daytime drowsiness level continues to drop.  That’s very nice for me and anyone else on the highway as I drive.  As the old saying goes, “I want to die in my sleep, like grandpa; not screaming like the passengers in his car.”

There are listed side effects:  allergies and sinus impacts that seem to bother some people.  So far, not me.  My eyes are much puffier, which the folks put down to an insufficiently tight mask blowing air into my eyes at night, but I also think that there might be something to do with a radically different blood chemistry (less CO2) and less stress hormones from not choking yourself (so to speak) every night.  This has been the most significant side effect I’ve seen personally, but it’s fairly common according to Google®.  More severe side effects appear to be edema (fluid retention) in folks that aren’t having any sort of problems that would normally cause fluid retention.  That’s more difficult to deal with, since  (according to the message boards) doctors seem to think that edema would be some sort of witchcraft that can only be fought with sacrifice of a virgin – and California doctors seem to be all out.

Per the studies I could find, the minimum amount of therapy required for significant death reduction is 5 of 7 nights, 4 hours nightly, which seems low to me.  But, hey, I didn’t take the data.  However, the message board people (again) wouldn’t fly in an airplane and sleep without using their CPAP.

About 54% of users stick with CPAP after being prescribed.  15% give up after an average of 10 months of trying, and 31% . . . never started.  These percentages are nice, because they add up to 100%, so you know they must be accurate.  I just wonder how many of the 31% never start because of the stupid name.  CPAP.  Ugh.

I’ve found the following personal benefits – I’ve got more energy during workouts – a lot more.  I can exercise harder and for longer duration, about 40% more.  I’ve also got a “more full feeling” (less desire to eat), which I hear is a benefit of not getting choked every night.  I tried to replicate these findings, but The Mrs. seemed to object with me randomly choking her for two minutes 10 or so times an hour.  She’s so closed minded!  This is ¡Science!  How dare The Mrs. oppose ¡Science! by not letting me choke her ten times an hour?

And, obviously, since I’m getting better sleep, I’m not as sleepy during the day.  Since nobody is choking me.  Except The Mrs. in some weird retaliation.  I mean, she’s not even writing down the results, so her choking me isn’t science, right?

The weirdest side effect?  My dreams have been much more vivid.  And not always good.  I rarely have nightmares, but I’ve had several since starting CPAP.  And these aren’t your normal nightmares – these are nightmares that make Silence of the Lambs look like a Pixar® movie.  I mean, there were both Kardashians and Madonna® in that dream.  Ugh.  I still feel like I need to take a shower.

My only theory is that previously my sleep would have been disrupted and I would have woken up.  I’ve always had the ability to alter my dreams when they got too weird, and I still can, but in order for me to alter the dream, I have to realize I’m dreaming – and these dreams are so very vivid that on several occasions in that “drowsy-waking up” time, I’ve been convinced these dreams were real.  So, I’m either sleeping better or I’ve got a “back order” of vivid, crappy dreams I have to have to catch up with everybody else on planet Earth.  You poor, poor, people.

Regardless, I’m going to experiment a bit – maybe try a night without the CPAP SSHARC to see how that goes . . . I’ve been 100% compliant for the past three weeks, and maybe, just maybe, I’m feeling a bit naughty.

Call me a rebel.  A SSHARC rebel.  Yeah.  But no SSHARC tattoos for me.  They’ll just get droopy and look like bad cartoons when I go into the old folks home.

Note:  I AM NOT A DOCTOR!  This blog is just my strange, odd, and personal experience:  don’t do any of this nonsense without talking to your doctor.  Really.  I’m not a good role model.  I’m what the warning label said NOT to do.  Except ladies, don’t get a tat.  Really.  Ugh.

Houses: Fun, Profit, My Experiences and Bad Tax Advice

“You won’t Iose the house. Everybody has three mortgages nowadays.” – Ghostbusters

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My second house.  My worst moment there?  Discovering that I had termites and the only way to treat them involved an exterminator doing a painful extraction of $2000 from my wallet.

I’ve been a homeowner since I was in graduate school, with the exception of about an eight week period from when we moved from Alaska to Houston where we stayed in corporate housing until we could close on a house – oh, and it took 8 weeks for our household stuff to make it through the Panama Canal, so closing on a house too quickly would have been useless unless we slept in the pool, and then we would have been wrinkly raisin people – and everyone hates them.

That being said, I’d prefer not to live in an apartment in a big city – it felt too much like being a tiny rat in a cage next to ten thousand other rats in tiny rat cages.  Houses in the ‘burbs are much closer to the wide open country where I was raised – 15 miles from the nearest town of 1000 people.  To get to a town with 5000 people?  That was a 45 minute drive.  So the ‘burbs in Houston were like a crawling over three miles of sandpaper to get a beer on a 110˚F day.  I mean, I’m gonna do it, but I’m not gonna like it.

I’ve continually made the choice to buy homes.  Houston was the first place that we considered trying to rent – but the rent was too high, compared to what we would get.  Even though we always considered Houston a place that we would only be staying for a two years or so, we ended up buying.  As it is we ended up staying in Houston for thirty one months and twenty-nine days and got out as soon as we possibly could and did okay, but only because I was kinda sneaky.

So, should you rent or buy?

The positives of home ownership are:

  • Appreciation – Historically, housing prices have gone up over time. Even if it’s just keeping up with inflation, this is known as appreciation.  I know you normally feel appreciation that someone as wonderful as me lives and shares his wisdom with you, but when used with a house, it’s not an emotion, it’s a word that means the house is worth more than it was when you bought it.  Again, most of the time house prices increase over time.  But home prices aren’t uniform – in San Francisco you can’t buy a cardboard box next to a fish gutting factory for less than $23,000,000.  Where I live?  You can buy a house that a human could live in for $15,000 (not kidding).  Not a great house, but one you could live in.
  • Forced Savings – Unless you’re on some sort of “interest only” loan that they sell to LSD-using hippies who mistake bran muffins for money, every month that you send a check to the bank (or use that sorcery, electronic bill payment) part of your payment is interest, and part of it repays the borrowed amount, until the loan is eventually paid for. This is a savings plan that you have no real choice on, so you can’t drop all that money on PEZ®, pantyhose, and elephant rides.
  • Tax Deduction – If you pay interest, at least right now you can deduct it off of your taxes. I am NOT a tax adviser, so don’t go waving a copy of this blog post in the IRS agent’s face if you get audited.  But be sure to poke him in the chest with your index finger while loudly saying, “My taxes pay your salary.”  They love that.
  • Emotional – You want a house. I understand.  I also want a volcanic island lair and supervillain-type cars.  But no one understands me.  Maybe someone will understand your narcissistic desire for a . . . house.
  • Opportunity to be the Evil Neighbor Nobody Likes – That’s us. Not that we’re unfriendly, but we’re loud.  We yell.  Pugsley mows the lawn . . . interestingly some times – I’ve never seen a lawn that looks like a topographic map, but he figured out how to do it.  And the house could use a paint job.  And we have little dogs that will yap at you if you drive up to our house.  Yeah, we are “those” neighbors.
  • Asset to Borrow Against – Yeah. You can always borrow against the place if it’s worth more than you owe.  I did that once.  It worked out okay – divorces are expensive, and home appreciation paid for one.  I’d avoid this unless you want to pay off an ex-wife, it’s risky as can be.
  • Perception of Being Tied to a Place – People generally treat homeowners better, especially in places where respectable people own homes. So, there’s that.
  • Can Customize at Will – If you want to knock out a wall? Do it.  New deck?  Add it on.  Cow-launching trebuchet?  If the backyard is big enough, sure.  Unless you live in New York or California, in which case you can’t mow your lawn unless it’s above 2.4” and it must be kept below 2.55”.    I just read (seriously) about a guy who cut down several trees that were damaged by Hurricane Sandy.  Damaged trees that were on his own property (in New York).  And the city fined him $20,000.  For cutting down broken, damaged tress.  On his own property.     Count me out.
  • No Renting Rules – Smoke all you want, have pets, draw on the walls. Cut a pentagram into your wood floor if you want.  It’s yours.

DSC02453

Yes, I owned a three bedroom log cabin in Alaska.  I miss it every day.  Simple days.  And no termites.

But where there are positives, there are negatives, too:

  • Debt – Very few people can walk into a place and buy it with cash. So, people (generally) borrow money to buy a house.  Essentially, when you borrow money you’ve sold part of your soul to that person – you have to go to work to earn the money to pay the money you borrowed, PLUS interest.  Debt sucks.  So very much.  I have no debt I can’t write a check for, so, any debt I have is because it’s a choice.
  • High Payment – Debt can lead to a pretty high payment. One phrase that has fallen out of fashion (somewhat) is “house poor.”  That essentially means that you owe so much money on your house that you can’t afford to eat a Chick-Fil-A® because it’s too expensive.    House payments can eat up all of your income.  The guidelines for a loan used to be that the house payment could be no more than 28% of your income and all of your debt should be less than 40% of your income.  I think you should be striving for TOTAL debt to be less than 20% of your income for any sort of comfort.  Some folks prefer the zero debt level.  I can understand and agree – work for that if you can.  Here’s a post where I work out my past experiences on that (Homes: Affordability versus Income).
  • Tied to a Location and Place – So, if I hadn’t convinced my employer to take a $100,000 hit for me, it would have been hard to move from Houston. I would have been stuck in a place precisely when the economy was poor there.  One study from back around the turn of the century actually showed a correlation between home ownership and poverty in some locations – people couldn’t afford to move because they owed money on their house.  If this were for a grade or if I was being paid I’d look it up to give you the source.  You can if you want.  You have DuckDuckGoogle®, too.
  • Risk on Sale – This is sort of like the above – how long will the sale take, and how much money will you get? Who knows?  In aggregate, people talk about days on the market, average selling price.  But if nobody wants to by your house because it’s just icky and you carved a pentagram in the hardwood floor in the living room, well, you’re out of luck.
  • Commission on Sale – Unless you’re a realtor or want to pretend to be one, you’re going to pay someone 6% of the sales price when you sell your house. And if you sell it yourself?  People will want to negotiate that 6% out of you, since they know you don’t have to pay a realtor.  People are awful, right?  Oh, heck, I forgot, I’m a people, too.
  • Upkeep Costs – Replacing a roof, fixing gutters, mowing lawns, trimming hedges, painting, cutting down the dead tree on my property that overhangs the neighbor’s deck. What is this, a list of things my neighbors would like me to do?  Well, yes.  But also, a list of things that also you have to pay for over time.  And the costs add up – general upkeep on a house costs thousands of dollars a year.
  • Utility Costs – If you rent, some of these are (generally) covered. If you own a home, you have to pay them all.
  • Insurance Costs – If you owe money (which is the default condition) on the house, your mortgage company will generally insist that you pay for insurance so that their asset (your house) maintains value and they don’t lose money. The bright side?  You get to pay for it.  I meant the bright side for the mortgage company, not you.
  • Upkeep Time – Somebody’s gotta mow. And it’ll probably be you, until you get a teenager.  Then they’ll want money . . .
  • Large Percentage of Money Invested – You might have $4,000 and some dryer lint in your 401K, but you’ve invested $20,000 on the down payment of a house. That’s a big investment.  Will it pan out?
  • Liability – Somebody slip and fall on the sidewalk in front of your house? Yeah, they’re gonna sue you.  I hope you have insurance . . .
  • Homeowners’ Associations – HOAs are run by bitter, retired old cranks with nothing better to do than complain about how people keep their yard, and send nasty, threatening letters with real legal consequences behind them. Don’t forget, Homeowners’ Associations have downsides, too.

DSC03670

The Boy and Pugsley in our Houston house.  I think this was taken at the coldest day in December, since it was never below 145˚F when we were there.

Economics:

I’ve bought five houses and sold four, so how’s that working out for me?

The net gain (based just on sales price) is up about $100,000.  Not bad, right?  Well, like anything, there’s more to that story . . .

In Houston, I almost certainly would have lost about $60,000 plus had to pay my mortgage, insurance and utilities for 18 months while the house sat on the market had I not negotiated one little clause with my employer before accepting a job with them – if they moved me from Houston, they would pay me what I had in the house.  I didn’t want any gain, I just wanted out.  They agreed.  Why not?  This was before the housing bubble collapsed.  Home prices always go up, right?  So, of my $100,000 of profit, I’d actually probably be around a net of zero dollars had I not negotiated for that . . . “one last small item.”

Oh, and my current house?  If I sold it today, it would probably go for $40,000 less than I originally paid for it.  Yeah.

But those aren’t the whole economic picture.  I’ve actually had to pay interest on borrowed money for these houses.  I did some sloppy math, and I’ve paid about $140,000 in interest.  Sure, it’s deductible, so I’ll only take a $90,000 hit for interest payments.

But there’s also been upkeep and improvements.  I’d estimate (and I think this is low) that I’ve probably spent $125,000 on maintenance and improvements.

So, net (and I’ll keep my sly job negotiation gain and NOT account for a loss on a property I haven’t sold) I was up $100,000 – $90,000 interest – $125,000 upkeep/improvements.  This says that I’ve paid roughly $135,000 to live in my houses.  Keep in mind that number could be closer to $235,000 except for that one shrewd move I made.

What’s the alternative?  I picked a ballpark rent, and multiplied, and the total was $460,000 for the time period in question.  So, for me, owning homes has saved me $325,000 versus the alternative of renting.

But your mileage may vary based on the following criteria:

  • Debt Load – As mentioned, if you’re paying too much money in debt – you fry your family future. Avoid debt as much as possible.
  • Area – Is the area poised for growth? Good schools?  Industry/commerce moving in?  Or is it a dead zone with a declining population like Flint, Michigan?
  • Commute Time – Every minute commuting is a minute you’ll have to spend EVERY DAY that you go to work. Those minutes?  They’re your life.
  • Duration – How long are you going to be there? Six months?    Five years?  Buying becomes an option . . . .
  • Single Vs. Dual Income – Let’s pretend you now have only one income – your spouse isn’t working. If you can’t afford the house with one income, you can’t afford the house.
  • Cost of Rent vs. Cost of Ownership – In the town where I live in Midwestia, I mentioned you could buy a livable house for $15,000. Why would you rent?  Dunno, but people do.
  • Consequence of Default – Varies by state. I’m NOT a lawyer, and I’ve never defaulted.  So, what’s the consequence if you can’t pay?  Do you have to declare bankruptcy, or can you just mail the keys in to the mortgage company.  You might want to know this where you live.

Buying a home is a complicated decision.  It’s worked out well for me (so far) but it could have been different.  Think about it, especially before you buy that unique fixer-upper in central Manhattan.  Is it really worth $41,000,000 to own a single room apartment that was once rejected as a site for a Sex and the City™ episode?

Lost In Space, or, How There Are No Liberals in Foxholes

“Do you mean he never told you the tale?  To amuse your captain? No?  Never told how the Enterprise picked up the Botany Bay, lost in space?” – Star Trek, Wrath of Khan

lostinspace

Violence can’t cure violence, but it sure can destroy an alien robot.

I mentioned last week about a scene in the Netflix® remake of the 1960’s series Lost in Space™ where the father, John Robinson, (a Marine, I believe) was attempting to use a 3D printer to print out a gun.  The reason he wanted to print out a gun?  They were on an unknown planet with unknown hostile critters around them.

In the next episode, there were space eels (complete with space teeth) that were drinking the spaceship’s space fuel.  Without the space fuel, the space ship becomes better known as a “house.”  And in this case, a house that was in danger of being crushed, perhaps killing the entire family.

A good time for a gun, right?

No.

He had to fight the space eels with a knife, and, though they did survive, he still doesn’t have a space gun.  Because . . . there are no reasons to have guns in space, according to his wife, Maureen Robinson, who has the keys to the 3D printer.

I actually laughed out loud.

Stranded, on an alien world, with dangers, unfathomable dangers surrounding you isn’t a good reason to have a gun?  I’m pretty sure that the number of mothers that would share that sentiment is very near zero, even someone very liberal.  Why?

Reactions to conditions change opinions, and the elements of danger change how we act as a society and as individuals, and the values that we hold dear.  An example:  very few (nearly zero) people knowing that a dangerous person is inside their house, outside the door of their child, would not want to have a gun.  The old saw is that the police are only minutes away when seconds count, and it’s an accurate phrase.

What other values besides personal defense change in response to societal stress or imminent danger?  Quite a few:

Family – in times of danger and stress, society as a whole will tend to push more toward monogamy, restricted sexual mores, and more stable families.  Why?  When resources are constricted, there is a real danger that family dissolution would lead to great disadvantages to the family.  Hence, families bond together more tightly.  Divorces dropped significantly during the roughest parts of the Great Depression – dropping 25% during the first few years.  Divorce rates have headed back up, and it’s nearly certain that the great economy plus the social safety net of the various welfare programs have had on the family.

family

Oh, next one dad is going to read is about environmental regulations associated with nesting migrant waterfowl.  YAY!

Capitalism – Ironically, the great degree of material prosperity brought about by capitalism actually agitates people to want to take the stuff that other people earned.  For whatever reason, this isn’t known as greed.  I had a conversation with a friend, and noted that since socialist countries tend to freeze intellectual progress, wouldn’t it be better if we went farther into the future before we became fully socialist so we could have the innovation that capitalism provides.  He thought that was a good idea.

Communism has been the result of social upheaval, not communism in the past – and you’d think that would be an indicator that communism was inevitable with a large enough crisis.  And it appears it might be, but only in nations built upon totalitarianism in the first place – when Russia fell it was from one absolute government to another.  When China fell, it was from one a military ruler to another military ruler.  But the United States was different – sure, communists made a run at the country, but there wasn’t any real chance they’d win.  Why?  Americans had been free – and the fabric of the nation was built upon the idea that if you let a man have a chance, he can make it.  That’s the American Dream, right?  No part of the American Dream has ever been “give me everything and I’ll give you my soul.”

During tough times, will Americans still turn towards capitalism?  Yes.  At least now.  More on that for a future post.

communism

Yeah, I’m making the memes now.  My kids hate this.  All bad “dad” jokes.

Good and Bad – In a crisis, good and bad exist.  Liberals hate the concept of good and bad – it’s judgmental.  It’s a violation of a basic premise – that all cultures are equal.  And, maybe on some sort of academic realm, they are.  But cultures are vastly different at the most basic level on the outcomes of wealth and individual freedoms they produce, and some are horribly inferior on this basis.  They’re bad.

There.  I said it.

And if we’re fighting them?  They’ll be the bad guy.  And you’ll agree, liberal or conservative (if we’re in a crisis).

grumpy cat culture

He only laughs at pratfalls in movies if he knows that the person broke a bone during filming.

I won’t go through them on this post (but each topic could be its own post), but the following topics are also ones where people will change their opinions based upon the level of crisis in society:

  • Immigration
  • Nationalism
  • Small government
  • Political correctness

As many of my college textbooks said . . . the proof is elementary and left to the reader.  But I might post about them in the future.

We are in for changes in our future, and the very mindset of society will change in response to our condition.  Be ready.  Or, failing being ready, have a knife to kill the space fuel eating space eels.

Purpose, Retirement, and Life. Spoiler: You need a purpose.

“We’re the middle children of history, man.  No purpose or place.  We have no Great War.  No Great Depression.  Our Great War’s a spiritual war.” – Fight Club

Retirement-pencil

I love Demotivators.  You should buy a calendar a year from them.  Or more, if you have more than one year each year.   

Men must have a purpose.  If they don’t have one, they’ll either find one, or die.

During the vast majority of my career I’ve been a supervisor of between one (which is the minimum you can be a supervisor of, unless you have multiple personalities) and 200 people (they worked for the eight or so people working for me, so I was like a great-grand boss).

I’ve seen all sorts of weird things – an employee on day one had his company laptop stolen out of his hotel room in New Jersey and then got punched in the face at his apartment building the next day and showed up to work with two horrible black eyes (this story is true).  I worried he would be an awful employee – bad luck often seems to follow some people around, but he turned out just to be unlucky that week – the rest of his career has been pretty good.

I’ve seen employees quit for no real good reason, I’ve seen them quit for very good reasons.  I’ve (unfortunately) been in the position of forcing an employee out (i.e., letting them know that the hammer is coming down so they’d better find something soon) and I’ve had to fire people.  Firing is the roughest, but it also helps the employee find a place that they can be that will help them – most of the times, they’re just not a fit for the job.  One employee developed diabetes and ulcers while working for me.  The job wasn’t high pressure, but the employee just wasn’t cut out for it.  Or, maybe I’m an amazing jerk.  Nah, it must be he wasn’t cut out for it.

Sometimes the happiest occasion is when an employee retires.

fozzie bear

Not that I want them to retire, especially if they’re good at what they do and fun to be around.  But after 45 or 50 years, it’s nice for them to be able to spend the next few months before they die doing whatever they want to.  I kid!  But how many people retire and then die within a few months?  Far too many, and I think I know why.

I was fortunate enough to be a supervisor to two employees that retired on the same day, Kermit and Fozzie.  Kermit and Fozzie had worked together for decades.  They had vacationed together.  They lunched together.  I think they even shared shoes and toenail clippers.  It was only fitting that they retire on the same day.

Fozzie was ready to retire.  Really ready to retire.  He had plans.  He had a big RV, plans for fishing and grandkids.  He had bought a house about 100 miles away and sold the one near to town.  He’d calculated his retirement down to the penny – and figured out how to maximize every benefit he could think of.  And he was done.

About six minutes after we cut the retirement cake, he was gone.  The last time I heard from him was as he walked out the door at his retirement party, essentially telling us if we ran into any problems and needed his help, he’d be available approximately never.  His last act was to place a huge poster on his office door specifically mocking in a humorous way about a dozen employees that he found fault with.  (Thankfully I wasn’t on the poster.)

Fozzie was done.

In truth, he was probably done two or three years earlier, but he had waited for Kermit.

kermitretire

Kermit had a house that he had bought that was closer to 200 miles away.  But Kermit didn’t have plans.  He rarely saw his grandkids, and his hobby, his passion was really work.

Both Kermit and Fozzie had a great amount of technical knowledge – and I promised either of them that they could get an hourly consulting contract to assist teaching the 24 year old kids that were replacing them.  Fozzie told me in rather distinct medical terminology exactly where I could put that contract.  Again, nothing personal.  Fozzie was done.

Kermit?  Three months later Kermit was in the office at least 20 hours a week.  I rarely tasked him with anything specific – I mainly had him help and teach the younger employees (which I think he loved).  I’m not in that position anymore with that company, but Kermit is still coming in every week.

Why does Kermit keep coming in?

It’s his purpose.  If he wasn’t at work, he wouldn’t have a purpose.  That’s not an indictment of Kermit – he’s a heck of a guy.  He simply understands (or maybe feels) that he has the ability to keep going and to keep adding value in the workplace.  And he’s got nothing in his life outside of work that makes him that happy.

Kermit would do it for free if he wasn’t being paid.  I actually think there are some months he didn’t bill the company – and I recall having to nag him about turning a bill in at all.

I’m certain that if Kermit wasn’t coming in?  He’d die.  It’s who he is.

Men must have a purpose.  If they don’t have one, they’ll either find one, or die.

What’s your purpose?

catpurpose

 

 

What should you do in an economic downturn? Depends . . .

“Out these windows, we will view the collapse of financial history.  One step closer to economic equilibrium.” – Fight Club

Since 1940, the United States has had 12 recessions, as recorded by the Fed.  The graph is below.

fed unemployment

Want to start a small business?  Just buy a big one before a recession, and wait!  Saves a lot of hassle!  The gray bars are recessions.

Why do we have recessions?

There have been several economists who have tried to explain this.  One of the earlier explanations was from Ludwig Von Mises.  Von Mises, being Austrian, was the founder of what is known as the “Austrian” school of economics.  Austrian economists are the mortal enemy of Keynesian economists (named after John Maynard Von Keynes, it being a new rule that every economist must now have “Von” in their middle name).  Often the Austrians and Keynesians will have gang fights over who has better economic theory, but they’re economists, so the gang fights look like slap fights between anemic three-year-old girls.

Von Mises felt that recessions were caused by a debt cycle.  At a time (like today) you can borrow massive amounts of money at very low interest rates.  My current house is mortgaged at 4% or so, but my first house was financed at a rate just over 9%, and that was a bargain at the time.  And my current savings account pays interest in dust and, on a good year, in little balls of dryer lint.

voneconomics

Little known fact:  Ludwig Von Mises (Miller) was Superbowl® 50 MVP!

This condition (like we’re in today) encourages investment, and discourages savings.  An example:

The little town I’m in has one hotel that was built since Bill Clinton was president.  There are a collection of at least two other (nice) hotels around town.  And, there are about three hotels that were constructed when the building code required use of lead pipes, lead paint, and asbestos carpet.  So, there are hotels for moderate budgets (like $90 a night) all the way down to hotels that take payment in squirrel pelts (tanned only – no raw pelts).  No five star hotels, but, really, this town isn’t one you’d come to visit as a tourist.

But somebody decided we needed another hotel.  And they built one – a brand new, brand name hotel in a town that already had enough rooms.  Why?

Interest rates are low, so the hotel company is just looking for places to spend money.  If they can borrow it at 5%, they don’t have to make too much money for the investment to pay off.

In an environment with low interest rates and large amounts of money available, companies will borrow money to do almost anything – projects that are crappy at 10% interest look great at a 5% cost of capital.  So they borrow first to do the “great” projects and, once those are done, companies then borrow to do the so-so projects.

What happens when the interest rate goes up?  Or the business ideas that are presented are so silly (strawberry picker making $15,000 a year buys $720,000 California house – LINK) that when they make the papers they become legendary.  Another way to tell is when a Wells Fargo® bank has a Starbucks© inside it’s lobby – and the Starbucks has a Wells Fargo™ bankette inside.  With a tiny Starbucks©.  You can tell that maybe, just maybe, the economy is nearing peak stupid.  (This happened in Houston – there was a Starbucks™ in the mall in front of the Target©.  The Target® had a Starbucks™ just inside the door.  So did the Wells Fargo© bank. Next to the Target™.)

As we watched the housing market collapse, as well as the financial shenanigans machine industry that supported it, my lawyer friend said to me . . . “Well, when you’re at the beach and the tide goes, out, you see who wasn’t wearing any clothing.”  The length of time of artificially low interest rates and the greater the amount of “silly” investment is like a drunk’s binge – the longer it lasts the bigger the hangover.

Examples of irrational thought:

  • The price of a house never goes down – it’ll go up forever. And this one is in a great location, right next to the high paying jobs at the chemical plant.
  • The price of a stock never goes down – stocks will go up forever. And that new car will never replace horses!  Silly!
  • Comics are totally the best investment anyone could ever make. This issue of Teen Manga 2000 will be worth millions!
  • “It’s different this time.”
  • “Stocks have reached a new permanent high plateau.”
  • “This company, Montgomery Ward Toys ‘r’ Us Sears Tesla will last forever . . . .

And then, something happens.  Oh, sure, it looks like . . . 9/11.  If the economy were healthy and operating on all cylinders, 9/11 wouldn’t have led to a recession.  The reason for the recession isn’t what’s in the papers – the economy was sick from too much bourbon.  It was going to throw up anyway.

Make no mistake – the United States is an economic engine.  2% growth is middling, but a 2% contraction is catastrophe.  Why?

All of the jobs are created at the margin, at that 1% or 2% of growth.  A small contraction ripples through the economy – now people are losing jobs.  A 2% contraction is really a 3% or 4% contraction.  That can set off a chain reaction (like during the Great Depression) – those people aren’t consuming, so the next group of people lose their jobs/businesses.  And so on.

Also, in the past, inflation was a thing that happened.  Now we pretend it doesn’t, even as food goes from a $5 lunch to a $10 lunch, minimum.

Eventually, however, the Central Bank (in the case of the United States) can hold back the interest rates no longer – it has to raise them or risk the currency (dollar) becoming worthless.  Interest rates rise.

Formerly profitable projects and businesses are no longer profitable at the new rate.  They get cancelled, or in some cases abandoned during construction.  Or the entire business fails.  The average business lasts . . . 10 years, regardless of age.  Big ones, small ones, they get eaten or fail.  It’s part of that regrowth that’s actually nice about capitalism.  Wouldn’t it be nice if the DMV had to compete to get you to come in and get license plates or a new driver’s license?

So how should you behave in an economic contraction?

First, the pitfalls:  being right early is EXACTLY the same as being totally wrong.  In 1994 I saw that Marvel® had a great group of characters, and if they could only exploit them, they’d have a franchise that was worth millions.  So, I placed a big bet – $2000 – on Marvel™ Entertainment stock.  Which promptly went bankrupt, making my investment worth a handful of magic beans.  Sigh.  Again, being right early is exactly the same as being wrong.

Second:  Getting out early (which I’ve done a time or two or almost always) has proven to be a killer.  Getting out while the market is still going up has cost me a lot of gains.  Not that I’m complaining – the world has been awesome for me, but I really wish I could afford a private island with a heliport inside and extinct volcano.  I’ll have to buy an island without a volcano.  Again.  Sigh.  Is an extinct volcano too much to ask?

So, what do you do when faced with an economic downturn?  I’ve developed a helpful graphic:

Size of Downturn Best Investment Amount of Panic Beware of: Move to:
1-3% Stay the course – keep investing every month. Bernie Sanders waves his hands and screams for more aid. Falling stocks. A nice property you bought at a bargain.
Less than 5% Whiskey.  AAA Bonds of solid countries, like Switzerland.  Gold. Bernie Sanders takes his hand out of his pockets and puts them in yours. Communist revolution.  Oh, wait, they already got California. Montana or Idaho.
More than 10% Ammunition.  Even more whiskey. Bernie Sanders forms a cannibal paramilitary organization. Better Call Saul being cancelled. Your island with a helipad in an extinct volcano.

The real answer is that response to a downturn depends on:

How much money you have.  If you have plenty, you’ll be fine.

How long the downturn lasts.  If a year or two, you’ll figure it out.  If a decade or more?  Yikes!   (Unless you have lots of money.)

How severe the downturn is.  See above.  The “More than 10%” is not really all that much of a joke.

How much your job is impacted.  This you can figure out now.  If your company could do fine without you, you don’t figure into any strategic initiatives, and you make a lot of money?  I hope you saved some, because you and dozens of people that look just like you will be looking for a job soon enough.

Ma Wilder’s family, the McWilders, took in a batch of neighbor kids during the Great Depression and helped to raise them.  Great Grandpap McWilder was wistfully employed on the railroad and operating a boarding house.  Plus he ran a gambling house (I think) that sold illicit whiskey.  He did what he had to do to get by during the Depression.

Great Grandfather Wilder ran a bank that did fine during the Depression.  Never had to hustle, worked banker’s hours.  Depression?  Not for him.

So, be like Von Mises and Great Grandfather Wilder!  Blitz that recession!

The Coming Civil War Part II, and a (Possible) American Caesar

“Who the hell is Julius Caesar?  You know I don’t follow the N.B.A.” – Anchorman 2

Pompey

This is Pompey, the opponent of Julius Caesar.  Yeah, there’s no second place in history for “nearly became emperor.”  Thankfully, there was first place for “widest head in history” which he won, hands down.  I mean, seriously, how could this guy buy glasses?

Last week’s post was the first prediction about the coming future of the United States.  You can read it here (The Coming Civil War (United States), Cool Maps, and Uncomfortable Truths) and another good post about the life of empires is here (End of Empires, PEZ, and Decadence).  Breakup was the first, and in my mind, still the most likely scenario.  But it isn’t the only one – there is at least one other possibility worth considering.

As I referenced in the post, there was a moment where Julius Caesar stood upon the banks of the river Rubicon and thought about his future.  As he looked at the shallow river he considered the orders from Rome:  at the banks of the Rubicon he was to turn over command of all of his legions.  Julius had four legions under his command in his conquest of Gaul.  But as he stood on the banks of the Rubicon, only the 13th Legion (Legio XIII, Gemina, or “Twins”) was at his back.

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Caesar at the banks of the Rubicon.  Some say he thought weighty thoughts about how he could best govern Rome.  I wonder if he was thinking about what was on TV, or if Brutus accepted his Facebook friend request?

To cross without them would, he feared, most certainly end with him being tried for political crimes (mainly the crime of being more popular than the sole remaining counsel, Pompey).  To cross without the army, then, might mean that his long career for the Roman Republic would end in dishonor.  In Gaul alone, his legions had faced over three million men, killed a million of them, and enslaved a million more – not a record that generally leads to disgrace, but a record that still irritates the French 2000 years later.

Legend recounts that as Caesar decided to cross the river and conquer Rome, as his horse’s hooves went into the shallow Rubicon he said, alea iacta esto, or, in a less-metric language, “Let the die be cast.”  And it was a gamble – he was outnumbered.

Caesar’s refusal to be a political pawn set him up to do what no other man on Earth could do – he conquered the most powerful nation on Earth.  He transformed the Roman Republic after a civil war, and created the Roman Empire with him as the leader.  The Roman Republic would never again exist.

At the time of Caesar’s ascension to becoming “dictator for life,” Rome had become a Republic ruled by a small number of families, including the Bushes and Clintons those of Pompey and Cicero.  Historian Adrian Goldsworthy writes in his book Caesar, Life of a Colossus (p. 378), that, “The Republic had become dominated by a faction who ignored the normal rule of law and particularly refused to acknowledge the traditional powers and rights of the tribunate.”

The empire that Caesar helped create removed the instability of the late Republic, and replaced it with a more stable structure that lasted another five hundred years.

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Here is a painting of Vercingetorix, a chieftain who united the Gauls, throwing down his arms at Caesar’s feet.  This was painted in the 1890’s in France, and there are numerous historical inaccuracies in the painting.  Among them:  it’s unlikely that Vercingetorix would have had such a stupid mustache, and Caesar always had his iPhone® at surrenders listening to “We Are the Champions” by Queen on a loop in his earbuds.

The transition from Republic to Empire was completed within 20 years’ time.  Caesar put all of the rules in motion for his last name to become a title – the Roman emperors became Caesars.  The title followed to the German king – Kaiser and the Russian Emperor – Czar.  Think about that – your last name becoming synonymous with being an emperor for 2,000 years . . . “Wilder John the First” has an awesome ring to it, right?

But this is the other possibility for the United States:  whereas breakup into multiple states is likely the longer we go, there is still the possibility of an American Caesar, especially if the crisis is within the next 10 years or so while some shred of commonality can be forced upon us.  Sure, we won’t call him (or, much much much much much much less likely, her) “Caesar.”  We’ll probably call them “President” and pretend that the “for duration of the (endless) emergency” part doesn’t exist.

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If we have a female American Caesar, she will probably look like the picture above.  Don’t worry, she doesn’t bite.  Oh, wait, she does bite.  And that’s not autographed to me – I found this one on the Internet.

And notice that I said forced.  The way we get to an American Caesar is through crisis – real or invented.  A currency one would do just fine, and I’ve pointed out that a currency crisis is inevitable here (Rome, Britain, and Money: Why You Can’t Find Fine China after the Apocalypse) and here (More Budget Doom, The Rolling Stones, an End Date, and an Unlikely Version of Thunderstruck), it would certainly bring the “need” for a strong, popular leader to take the role of power to save us all.  We almost ended up with one in 1932, but thankfully FDR gave out as World War II was nearing completion – if it had been a younger, more physically fit man?  Yeah, it scared the heck out of America.  That’s why we had a two term limit in place for Presidents before Roosevelt’s corpse was cool.

History shows that people give up freedom to someone who makes promises.  Napoleon, Lenin, Mussolini, Hitler, and well, here’s the map from Freedom House.  Most of the world’s population lives under what would be considered a dictator.  Very little freedom.

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But never in the United States.  Why not?

  • Historically, the United States has been driven by a core desire for individual freedoms and liberty. Those freedoms and liberties were specifically written into the Constitution, despite several politicians of the day noting that no government would EVER try to take these freedoms away.  The Bill of Rights has been a firewall against government power.
  • Separation of powers is another key. The President can’t make laws, only Congress.  The President can just refuse to sign them.  And the Supreme Court has the ability to call into question the Constitutionality of all of those laws (Jefferson argued the President had those powers as well).  These divided powers were intended to prevent the Federal government from acting unjustly.
  • As a further (and much stronger) barricade against tyranny, the states had significant power: they appointed Senators.  Without the Senate, no new law could be made.  The states further had delegated to them all powers not specifically granted to the Federal government.

But those are weakening.

  • The Supreme Court has made decisions that create new categories of rights of people to have stuff (the old Bill of Rights prevented government from doing things, not granting people rights to stuff). And recent rulings generally allow the government to do pretty much what it wants in most cases.  We’ve gone from a limited Federal government to a Federal government that can choose the size of your toilet tank and define what features you MUST buy if you buy a new car.
  • Separation of powers is eroded. Congress writes the laws, but bureaucrats from government agencies run by the President write the regulations that implement those laws.  Page after page of regulation.  81,000 in 2015.  Stack one atop the other?  A three story building’s worth of paper.  With that many regulations, everyone is guilty.  Everyone has done something wrong.  To go back to a Roman, Tacitus:  “The more corrupt the state, the more numerous the laws.”
  • States in the United States are little more than counties since Senators become popularly elected. Senators are just Representatives (Congressmen) with longer terms, and they don’t represent the states at all.

So, the stage is set – a collapse of the walls that kept a dictator from gaining power.  Now all that’s needed is a set stage.  As I mentioned above, a significant crisis will set that stage.  Maybe it’s actual civil war, as noted in the previous post, which is driven almost entirely by economic difficulties.  People don’t fight in civil wars if they the major problem they have is whether to go to the mountains or on a cruise for vacation.  Civil wars happen when people have nothing left to lose.

And when people have nothing left to lose, Caesar will (possibly) emerge.  You won’t look at him like he’s the bad guy.  Political lines will disappear.  I was watching the Netflix® remake of Lost in Space.  Not bad, but there was one scene that was so unintentionally silly I laughed out loud.

Space eels were drinking the space fuel that the space ship needed to move away from being crushed.  Plus, the space eels looked like they could kill people, too.  The husband went down to the ship’s 3D printer to print out a gun to save the family from the space eels.

Mom had the codes to the printer, and it wouldn’t print out a restricted item (gun) unless she said it was okay.  Then she harangued her retired Marine husband that guns weren’t necessary to fight the space eels.

Okay, you can have staunch anti-gun principles, but the second a space eel is going to eat your kids?  You print a dozen guns.

Your priorities change immensely after three days without food.  You’d be just happy to have a strong leader who will protect you.  A leader who will feed you.  And you won’t worry so much if you can’t criticize him, especially if you have food.

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There was some comment that the maps from the previous post didn’t show the great amount of land that Trump won during the last election.  Here’s a different version, represented by area.  Future battle map for a new Caesar?  Asking for a friend.

You’ll look at him like he’s saving you, which he just might be doing.  He’ll have songs written about him.  And if he does a good enough job?  He’ll be remembered for 1,000 years.  If he does a bad enough job, he’ll be remembered that long, too.

When (if) he rises to power?  You’ll applaud.

Possibility, Your Choices, McDonalds, and Your Responsibility . . . (and too many “Your Mom” Jokes)

“And in Paris, you can buy a beer at McDonald’s.  And you know what they call a Quarter-Pounder with Cheese in Paris?” – Pulp Fiction

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This is a picture of the McDonald®’s shoe car, circa George W. Bush’s presidency.  Notice the French fries dangling from the rear view mirror.  Must be some sort of talisman that makes him attract your mom.

There is a brief moment at your birth, when every single possibility of who you will be, and what you can achieve is open to you.  If your genetics support it, you can do it.  You will never have more possibilities open to you than at that moment.  And, over time – slowly at first – those possibilities narrow.  Your life is a funnel, and the wide open end is the possibilities that you have on day one.  Eventually, that funnel narrows.  You make decisions that cut off possibilities – you decide to dedicate yourself to a single sport rather than trying to letter in three.  Possibilities disappear.  You decide to go to college rather than open a business.  Possibilities disappear.

Possibilities never reappear.  They were always there.  You can’t conjure them out of nothing, but you can fulfill them.

Your life consists of two things:  the choices you make (which determine the possibilities that you have) and time.  And your choices even determine how much time you have.  Choose wrong?  You lose a few options.  Want to shoot up heroin?  Chances are poor that you’ll live very long, unless you’re Keith Richards – honestly, I imagine that if you could isolate how to kill him you could make cockroaches AND mosquitos extinct with a single drop of that stuff.

But your life consists of your choices.

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Some good choices, some bad choices . . .

Ray Kroc was the guy who got involved with a little restaurant in 1952.  He helped franchise it.  Kroc built it into a brand we all know today – his vision drove the entire process.  Ray Kroc is the single person most responsible for McDonalds™.  He created, single-handedly, the concept of a clean hamburger place where you could get a decent meal inexpensively and wouldn’t be afraid that bikers or rowdy teenagers would cause a scene in front of your family.  Sure, a dollar burger isn’t five star French cooking, but it’s a dollar burger in a clean restaurant with a clean parking lot.

What Ray was doing at the time he got involved with McDonalds® was selling milkshake mixers to the McDonald brothers (who owned the restaurant).  He looked at the hamburger shop and saw it had great possibilities.  He went to work with the McDonald brothers (named Ronald, Bono, and Sting), and eventually bought the brothers out.  Oh, and in 1954 when Kroc started with them?  Yeah.  He was 52.

He was a FIFTY TWO year old milkshake machine salesman, and let’s be real – nobody puts that as their career ambition under their senior picture in the annual.  And Kroc was trying to sell a dying brand of milkshake machines.  Like your mother, his machines weren’t very popular, and unlike your mother, they were expensive.

He didn’t create a single new possibility when he made the jump from being a travelling salesman – that possibility was always within him.

Ray made the choice.  He was going to do more, and be more than a washed-up 52 year old milkshake salesman waiting to collect social security.  Why didn’t he do it before?  Don’t know.  Maybe in 1954 he just got up feeling like he had nothing left to lose – at 52 you know you’ve got more weeks behind you than in front of you, and maybe he sensed he had to make something go.

I know that many people like to put the cause of their situation in life and give up.  And it’s easy to blame everyone around you.  It’s easy to blame society, or your mother (let’s face it, we all blame your mother) or genetics.

Sure, it’s pretty unlikely that Ray could have been competition for Elvis in 1952 – Ray was too old.  Likewise, his shot at pitching for the Yankees® was finished.  He was past his prime – he would have had to start much earlier, rather than, you know, fight in World War I.

Those possibilities were closed down for him – but the reservoir of possibility was still open for him to lead a restaurant franchise system that’s served billions of meals and created an entire industry – without McDonalds® there wouldn’t be a Burger King™ or a Wendy’s©.  And if he hadn’t created that industry, there’d be no place for your mom to work.

Kroc eventually bought the San Diego Padres®, so there’s an argument that not all of his ideas were great, although he bought that team (when he was 70) for $12 million dollars, roughly as much as a current Major League® ballboy makes per inning.  As of today, that team is probably worth about a billion dollars.

So, I guess even that was a good deal.  True story:  when he told his wife he bought the San Diego Padres™ she asked, “What, is that a monastery?”

Friday is the day for health posts, so why am I posting about choices and Ray Kroc?

You are where you are today, almost entirely due to the choices you’ve made in your life.  If you feel that your situation is beyond your control, and blame everything else besides you, you’re done.  And those are a horrible people to hang around with – always whining and complaining about how the world is out to get them and the deck is stacked so they cannot win.

People who believe that the world outside controls them and their ability for success have what’s called by nerdy psychologists an “external locus of control” – and that’s not a good thing.  People who feel that way are stressed out all the time, and it shows in the results:  people who an internal locus of control believe the ball is in their hands.  The have better jobs that pay more.

Perhaps, oh, just perhaps, people who think that their output matter – work harder, and get better results.

So, short version?  Get your big boy pants on (or big girl panties on) and understand that your life is what you make of it.  The crappy time that you’re having at work isn’t because people are out to get you.  Unless your last name is Kennedy.  Then?  Yeah, maybe.

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