Mallory turned 2,000 days old today. My how she has grown in that time.
Saturday, May 19, 2012
Monday, May 7, 2012
Never give up
If my children learn one thing, I hope that it is that they should never give up. I want them to wake up every day wanting to succeed. Sometimes they will fail. For a while, we will be there to pick them up and dust them off. Eventually, they will need to do this on their own.
Below is a video that captures the spirit of never giving up.
Below is a video that captures the spirit of never giving up.
Sunday, May 6, 2012
Graduation Day
It has been a long time coming (it seems) and yesterday it finally arrived. I graduated with my MBA from Indiana University's Kelley School of Business.
The Kelley School make a fine production of it all. There was too much food and not enough catching up between the friends I had made over the past two years.
Enclosed are a few pictures from the event.
The Kelley School make a fine production of it all. There was too much food and not enough catching up between the friends I had made over the past two years.
Enclosed are a few pictures from the event.
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| Dean Smith addressing the graduates, family and friends |
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| The family at the fountain in front of the College of Fine Arts |
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| Me prior to the ceremony. The cords were courtesy of the Veterans Services Office. All vets wore them for graduation. |
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| It will be 10 short years before Mason walks in his high school graduation ... |
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| ... and only a few more after that for this one. |
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| Noel and me before the ceremony. She has supported me tirelessly through this. |
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| A few of the proud graduates (Farooq, Amy, Brittany, Brian, Greg and me). |
Saturday, May 5, 2012
Get well, Drew!
Drew, one of my classmates, missed graduation tonight. He had knee surgery earlier in the week. The word is that he is in a lot of pain.
I hope he knows that he was with us in spirit.
I hope he knows that he was with us in spirit.
Wednesday, March 28, 2012
Investing in U.S. Stocks?
A couple of days ago, Tim Ferriss, an influential member of Gen X (who has built quite a following online of which I consider a member), sent out a Tweet with a link to an article by Auren Hoffman. His Tweet alarmed me because he carries so much weight with so many people that uneducated readers might take his mention of this article as an endorsement and give it credit it does not deserve.
In this article, Hoffman explains why he won't invest in U.S. Stocks and offers six points as to why not.
After I read the article, I sent a tweet back to Tim Ferriss saying that this advice is dangerous. US Stocks belong in a well diversified portfolio.
I'd like to address each of these, in turn.
1. Retirement savings
Hoffman argues, that with the Baby Boomers retiring, the stock market will be flooded with equities. With more sellers than buyers, the price will drop precipitously. This will devalue stocks across the board. He even claims that "one of the biggest reasons the market has been flat over the past 15 years" is because of folks leaving equities for safer investments.
However, the market is up 92 percent from March 26th, 1997 (15 years ago). The bottom line is that stocks are priced based on a company's future earnings, and the number shares outstanding, not who owns them. Yes Boomers will transition out of stocks and into more fixed-income (bonds). I don't expect this to be a calamitous event, like Hoffman predicts. Before I leave this topic, I must challenge his assertion of 'the last 15 years'. The first Baby Boomers didn't turn 65 until 2011. In 1997, the oldest members of that generation were still fully employed and should have been invested in the market. Even if they did, it doesn't explain the near doubling of the market over that time.
2. Globalization
Hoffman argues that emerging economies will overshadow the U.S. economy and U.S. stocks 'could be the biggest loser' (and not the Bob Harper kind) over the next 30 years. Hoffman is right that globalization is a two-way street. What he fails to pick up on is that when these emerging economies take off, American companies will be able to sell higher-end goods and services into these countries. Are rising exports not good for the economy and American companies? You bet they are. In addition, American companies may be incorporated here, but they are already reaping the benefits of a global marketplace. Crack open the latest 10-K (annual report) of an S&P 500 company and you will see that much of their revenue comes from overseas (its just too bad they can't bring it back without being taxed on it again ... different rant, different blog post). America is still THE place in which to conduct business. How safe are businesses' property rights in Chile?
He also claims that as the world gets more interconnected, ' it is also getting much more volatile.' I have no idea what data he is backing that up with (none, I am guessing) but global commerce has the opposite affect. Thomas Friedman, in The World Is Flat, outlines the McDonald's rule where no two countries with a McDonald's have ever gone to war with each other. This is used to illustrate how interconnected economies use means other than warfare to solve their differences. Sounds less volatile, huh?
His last sentence is the most damning: "This volatility is the enemy of the buy-and-hold investor who is at the whim of much more sophisticated global banks." It is precisely this risk that demands a higher return. Over time, these deviations produce much higher returns.
3. Technology Companies
Here Hoffman claims that Tech companies drove growth in the 80s, 90s and in the last decade. Not sure which tech companies drove growth in the 80s, but it wasn't until 1999 when the tech bubble expanded before bursting a short time later.
The bottom line is that flash-in-the-pan tech companies don't drive long term growth. The most boring companies that you could imagine are the ones to buy and hold for long periods of time. Trading stocks to catch a ride on the next shooting star is a fool's game. Long term investing in U.S. equities is not about picking hot, individual stocks. It is about long-term growth.
4. Taxes
You aren't going to avoid taxes. What is the alternative? Not investing? Hoffman claims that long-term capital gains are at/near an all-time low. Will they rise? Under this President; you bet your ass they will. But, is Hoffman claiming to so prescient that he knows the long-term rate in 20, 30 or 40 years from now? I don't think he does. Not investing in U.S. stocks now because of some phantom tax rate three decades from now is terrible, terrible advice.
5. Interest rates
To Hoffman's credit (it only took me to point 5 to give him credit), interest rates won't stay low forever. But, interest rates were much higher in the 80s and 90s, during one of the greatest bull markets in our history.
In this article, Hoffman explains why he won't invest in U.S. Stocks and offers six points as to why not.
- Retirement Savings
- Globalization
- Technology Companies
- Taxes
- Interest Rates
- You are already over-correlated to the stock market
After I read the article, I sent a tweet back to Tim Ferriss saying that this advice is dangerous. US Stocks belong in a well diversified portfolio.
I'd like to address each of these, in turn.
1. Retirement savings
Hoffman argues, that with the Baby Boomers retiring, the stock market will be flooded with equities. With more sellers than buyers, the price will drop precipitously. This will devalue stocks across the board. He even claims that "one of the biggest reasons the market has been flat over the past 15 years" is because of folks leaving equities for safer investments.
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| Does this look flat to you? |
2. Globalization
Hoffman argues that emerging economies will overshadow the U.S. economy and U.S. stocks 'could be the biggest loser' (and not the Bob Harper kind) over the next 30 years. Hoffman is right that globalization is a two-way street. What he fails to pick up on is that when these emerging economies take off, American companies will be able to sell higher-end goods and services into these countries. Are rising exports not good for the economy and American companies? You bet they are. In addition, American companies may be incorporated here, but they are already reaping the benefits of a global marketplace. Crack open the latest 10-K (annual report) of an S&P 500 company and you will see that much of their revenue comes from overseas (its just too bad they can't bring it back without being taxed on it again ... different rant, different blog post). America is still THE place in which to conduct business. How safe are businesses' property rights in Chile?
He also claims that as the world gets more interconnected, ' it is also getting much more volatile.' I have no idea what data he is backing that up with (none, I am guessing) but global commerce has the opposite affect. Thomas Friedman, in The World Is Flat, outlines the McDonald's rule where no two countries with a McDonald's have ever gone to war with each other. This is used to illustrate how interconnected economies use means other than warfare to solve their differences. Sounds less volatile, huh?
His last sentence is the most damning: "This volatility is the enemy of the buy-and-hold investor who is at the whim of much more sophisticated global banks." It is precisely this risk that demands a higher return. Over time, these deviations produce much higher returns.
3. Technology Companies
Here Hoffman claims that Tech companies drove growth in the 80s, 90s and in the last decade. Not sure which tech companies drove growth in the 80s, but it wasn't until 1999 when the tech bubble expanded before bursting a short time later.
The bottom line is that flash-in-the-pan tech companies don't drive long term growth. The most boring companies that you could imagine are the ones to buy and hold for long periods of time. Trading stocks to catch a ride on the next shooting star is a fool's game. Long term investing in U.S. equities is not about picking hot, individual stocks. It is about long-term growth.
4. Taxes
You aren't going to avoid taxes. What is the alternative? Not investing? Hoffman claims that long-term capital gains are at/near an all-time low. Will they rise? Under this President; you bet your ass they will. But, is Hoffman claiming to so prescient that he knows the long-term rate in 20, 30 or 40 years from now? I don't think he does. Not investing in U.S. stocks now because of some phantom tax rate three decades from now is terrible, terrible advice.
5. Interest rates
To Hoffman's credit (it only took me to point 5 to give him credit), interest rates won't stay low forever. But, interest rates were much higher in the 80s and 90s, during one of the greatest bull markets in our history.
In 1985, interest rates were six times higher than they are now (Of course, that didn't stop the high-flying tech companies of the 1980s that he writes about). He should be arguing that it is a terrible time to be in bonds. As interest rates rise, current bond prices fall.
6. You are already over-correlated in the market
This one (may) ring the most true. Much like you shouldn't have all of the money that you invest in the stock of the company you work for, you should be 100% invested in U.S. equities. Diversification is key. To get on what's called the "efficient frontier", you need to have a variety of assets that are not highly correlated.
And, that right there, is the entire point that Hoffman is missing. Much like Lucky Charms are part of a balanced, nutritional breakfast, U.S. equities should be a portion of an investment portfolio that contains Stocks (both U.S. and international), fixed income (bonds), real estate, precious metals, et al. The percentage of these securities all depends on your risk tolerance. If you are older, your risk is probably lower; if you are younger, it should be higher. There is some risk you can diversify away (by holding assets that are negatively correlated) and some risk that you can't (that's called Market Risk).
Not being in U.S. stocks hurts you in two ways. One, you are missing out on a key piece of diversification and two; you are missing out on lots of potential long-term growth.
Please ignore the terrible, terrible advice that Auren Hoffman is offering you.
Thursday, March 1, 2012
Andrew Breitbart
As many of you know, Andrew Breitbart passed away early this morning. If you are not familiar, he was a conservative blogger/provocateur who incensed many (especially on the Left). What was truly sad is the vitriol that erupted today on Twitter. @ComfortablySmug and 'Jim' 'Treacher' (Twitter handle: @jtLOL) both did a great job of capturing and re-tweeting some of the most hateful things said about Breitbart. The challenged many who would take such offense should these disgusting ideas have come about a liberal commentator.
Many proudly proclaimed that they were 'happy' and said 'good riddance' (I am surprised that wasn't trending, to be honest) and that the 'world outlook is slightly improved' (stay classy, @mattyglesias).
What troubles me most about these things is that those who Tweet them think that the world is better with one less dissenting view point. That is certainly not what the forefathers had envisioned and it is does not promote the idea of a free market place of ideas.
But, then again, most on the left are suspicious of a free market, anyway. Apparently, obnoxious and controversial views are okay, as long as they match their own.
Breitbart left behind four children and a wife. I hope that they can cope, heal and truly appreciate the impact their father and husband had on the political discourse in America. Regardless of whether or not you liked, or agreed with, Andrew Breitbart; America, and freedom, are now worse off for having lost a voice.
Many proudly proclaimed that they were 'happy' and said 'good riddance' (I am surprised that wasn't trending, to be honest) and that the 'world outlook is slightly improved' (stay classy, @mattyglesias).
What troubles me most about these things is that those who Tweet them think that the world is better with one less dissenting view point. That is certainly not what the forefathers had envisioned and it is does not promote the idea of a free market place of ideas.
But, then again, most on the left are suspicious of a free market, anyway. Apparently, obnoxious and controversial views are okay, as long as they match their own.
Breitbart left behind four children and a wife. I hope that they can cope, heal and truly appreciate the impact their father and husband had on the political discourse in America. Regardless of whether or not you liked, or agreed with, Andrew Breitbart; America, and freedom, are now worse off for having lost a voice.
Tuesday, February 14, 2012
Manufacturing in decline?
There has been a great deal of talk surround manufacturing as the economy continues to lag. Rick Santorum pounds the drum about manufacturing being in decline (every chance he gets).
The real problem with manufacturing is not output. That continues to go up. What people perceive as a decline in manufacturing is just a surge in productivity. More productivity = fewer employees. Look at the attached charts. The first shows industrial production. It keeps going up (except for this pesky recession which derailed it a bit).
Now look at the second chart. It show employees in the manufacturing sector. It is trending downward.
Those jobs are never coming back. New, higher skill manufacturing jobs are emerging; but those require more education. Continual self improvement is the best way to guarantee future employment.
Now look at the second chart. It show employees in the manufacturing sector. It is trending downward.
Those jobs are never coming back. New, higher skill manufacturing jobs are emerging; but those require more education. Continual self improvement is the best way to guarantee future employment.
Monday, January 9, 2012
Petzy
This morning, my grandmother, the woman who raised me for a very formative period in my life, passed away. I am going to sit here and cry for a few minutes so please indulge me as I remember such a wonderful woman.
On the way home from work this afternoon, she sent me a message. Not a text or a phone call. A technology more fitting her generation. On a radio station I seldom listen to, a Pearl Jam song came on the radio. The song is called "Just Breathe". I am not a particularly spiritual person, but I knew (the moment I heard it) that it was from Grandma.
The first verse starts:
The entire song is below in the embedded video (complete with lyrics). Feel free to press play, listen and read the rest of the post.
"Petzy", as she was known when she played cards (and she loved cards! Bridge, Crazy 8s, Uno; it didn't matter), cared so deeply about her grandchildren and I am lucky to be counted among them. She would pick the meatballs out of our alphabet soup and count them to ensure that both Greg and I got an equal number. She would sit at the top of the stairs and knit when a 5-year-old Doug wouldn't settle down and go to sleep. She and my grandfather dutifully drove me to school (along with my friends Tim and Jason). She would dress me for church every Sunday and drag a comb through my hair (only if she could see my hairline now ...).
She knitted thousands of Christmas stockings for relatives, friends and complete strangers. She told me once that she made one for a raffle and that the stocking raised over $1,000. Yellowed with age, my Christmas stocking is one of my most prized possessions.
I will miss her small house in Clymer, PA. She would bake me zuchinni bread, "grandma's" cookies (which were sugar cookies with a fork impression on them) and pour my cereal in the morning (asking first, if i wanted a glass of orange juice in order to 'wake up') on our annual visits. I remember her and grandpa sitting on their matching recliners drinking Top Hat (I may be imagining the brand) beer and watching sports. Her German heritage did her proud. I remember the cuckoo clock that hung in the living room. Mine is at the repair shop right now. My wife decided to dust it off and get it fixed about six weeks ago. I am so glad she did. I can't wait for it to come back. It will mean more now than ever.
I hope I make it back to Clymer. Our uncle is planning a small memorial service in the Spring there. I associate her small town with her, Grandpa and my two Uncles (Tom and Terry).
I can picture her standing in the small galley kitchen in the back of their house. She would wash the aluminum foil to reuse it; she would always tell me to be frugal and count my blessings.
I am so happy that I can carry on my grandmother's maiden name with Mason's middle name, "Ogden".
Most of all, I can remember, and will always feel, her unconditional love. "Ahhh, you're a good one, Doug," she would say, understating how she felt, as she leaned over to hug and kiss me. I owe a lot of who I am to both her and Grandpa. She gave up a lot to move to Ohio to help run the family after my mother died. What a selfless woman. What an amazing woman. I love you, Grandma.
On the way home from work this afternoon, she sent me a message. Not a text or a phone call. A technology more fitting her generation. On a radio station I seldom listen to, a Pearl Jam song came on the radio. The song is called "Just Breathe". I am not a particularly spiritual person, but I knew (the moment I heard it) that it was from Grandma.
The first verse starts:
Yes, I understand that every life must end, aw-huh,
As we sit alone, I know someday we must go, aw-huh,
Oh, I'm a lucky man, to count on both hands
The first lyrics are advice as if out of her own mouth. "Just Breathe" is something that I could picture her saying. I find myself telling my children, the things she told me 30 years ago. "Take tiny sips from around the edges if your soup is too hot."the ones I love...
The entire song is below in the embedded video (complete with lyrics). Feel free to press play, listen and read the rest of the post.
"Petzy", as she was known when she played cards (and she loved cards! Bridge, Crazy 8s, Uno; it didn't matter), cared so deeply about her grandchildren and I am lucky to be counted among them. She would pick the meatballs out of our alphabet soup and count them to ensure that both Greg and I got an equal number. She would sit at the top of the stairs and knit when a 5-year-old Doug wouldn't settle down and go to sleep. She and my grandfather dutifully drove me to school (along with my friends Tim and Jason). She would dress me for church every Sunday and drag a comb through my hair (only if she could see my hairline now ...).
Did I say that I need you?
Oh did I say that I want you?
Oh, if I didn't I'm a fool you see,
No one knows this more than me
She knitted thousands of Christmas stockings for relatives, friends and complete strangers. She told me once that she made one for a raffle and that the stocking raised over $1,000. Yellowed with age, my Christmas stocking is one of my most prized possessions.
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| The Huber Family Stockings |
I will miss her small house in Clymer, PA. She would bake me zuchinni bread, "grandma's" cookies (which were sugar cookies with a fork impression on them) and pour my cereal in the morning (asking first, if i wanted a glass of orange juice in order to 'wake up') on our annual visits. I remember her and grandpa sitting on their matching recliners drinking Top Hat (I may be imagining the brand) beer and watching sports. Her German heritage did her proud. I remember the cuckoo clock that hung in the living room. Mine is at the repair shop right now. My wife decided to dust it off and get it fixed about six weeks ago. I am so glad she did. I can't wait for it to come back. It will mean more now than ever.
I hope I make it back to Clymer. Our uncle is planning a small memorial service in the Spring there. I associate her small town with her, Grandpa and my two Uncles (Tom and Terry).
I can picture her standing in the small galley kitchen in the back of their house. She would wash the aluminum foil to reuse it; she would always tell me to be frugal and count my blessings.
I am so happy that I can carry on my grandmother's maiden name with Mason's middle name, "Ogden".
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| Grandma, Me and Mason in 2006 |
Most of all, I can remember, and will always feel, her unconditional love. "Ahhh, you're a good one, Doug," she would say, understating how she felt, as she leaned over to hug and kiss me. I owe a lot of who I am to both her and Grandpa. She gave up a lot to move to Ohio to help run the family after my mother died. What a selfless woman. What an amazing woman. I love you, Grandma.
Nothing, you would take,
Everything, you gave,
Love you til I die
Meet you on the other side.
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