Saturday, August 21, 2010

Brothers in arms.................

A father's influence...............

Mr. Rodney C. Lewis
Lincoln Laboratory
Massachusetts Institute of Technology
Lexington, Massachusetts

Dear Mr. Lewis:

     Thank you for your nice letter.  It makes me feel good to hear
that you liked my colloquium so much.  Don't despair of standard
dull textbooks.  Just close the book once in a while and think
what they just said in you own terms as a revelation of the
spirit and wonder of nature.  The books give you facts but
your imagination can supply life.

     My father taught me how to do that when I was a little boy on
his knee and he read the Encyclopaedia Britannica to me!  He
would stop every once in a while and say-  now what does that
really mean.  For example, "the head of a tyrannosaurus rex was
four feet wide, etc."- it means if he stood on the lawn outside, his
head would look in at your bedroom on the second floor, and if
he poked it in the window it would break the casement on both
sides.  Then when I was a little older when we would read that
again he would remind me of how strong the neck muscles had
to be- of ratios of weight and muscle area- and why land animals
can't become the size of whales- and why grasshoppers can
jump just about as high as a horse can jump.  All this, be
thinking about the size of a dinosaur's head!
     Yours sincerely,
     Richard P. Feynman

Turning Pro.........................

As promised, an excerpt from Pressfield's The War of Art on
how to combat resistance:

               "Professionals and Amateurs

     Aspiring artists defeated by Resistance share one trait.  They
think like amateurs.  They have not yet turned pro.

     The moment an artist turns pro is as epochal as the birth of
his first child.  With one stroke, everything changes.  I can state
absolutely that the term of my life can be divided into two parts:
before turning pro, and after.
     To be clear:  When I say professional, I don't mean doctors
and lawyers, those of "the professions."  I mean the Professional
as an ideal.  The professional in contrast to the amateur. 
Consider the differences.

     The amateur plays for fun.  The professional plays for keeps.

     To the amateur, the game is his avocation.  To the pro, it's
his vocation.

     The amateur plays part-time, the professional full-time.

     The amateur is a weekend warrior.  The professional is there
seven days a week.

     The word amateur comes from the Latin root meaning "to
love."  The conventional interpretation is that the amateur
pursues his calling out of love, while the pro does it for money. 
Not the way I see it,  In my view, the amateur does not love
the game enough.  If he did, he would not pursue it as a
sideline, distinct from his "real" vocation.

     The professional loves it so much he dedicated his life
to it.  He commits full-time.

     Resistance hates it when we turn pro."

Of round pegs and square holes............

Wisdom from The Tao of Pooh:

     "Cleverness, as usual, takes all the credit it possibly can. But
it is not the Clever Mind that's responsible when things work out.
It's the mind that sees what's in front of it, and follows the
nature of things.

     When you work with Wu Wei, you put the round peg in the
round hole and the square peg in the square hole.  No stress
and no struggle.  Egotistical Desire tries to force the round peg
in the square hole and the square peg in the round hole.
Cleverness tries to devise craftier ways of making pegs fit where
they don't belong.  Knowledge tries to figure out why round pegs
fit round holes, but not square holes.  Wu Wei doesn't try.  It
doesn't think about it.  It just does it.  And when it does, it
doesn't appear to do much of anything.  But Things Get Done."

Friday, August 20, 2010

The Allman Brothers............with Duane

longish, but worth the listen...............


A few excerpts describing the "Resistance" from Steven
Pressfield's superb book, The War of Art:

             Resistance is Invisible

Resistance cannot be seen, touched, heard or smelled.
But it can be felt.  We experience it as an energy field
radiating from a work-in-potential.  It's a repelling
force.  It's negative.  It's aim is to shove us away, distract
us, prevent us from doing our work.


             Resistance is Insidious

Resistance will tell you anything to keep you from doing
your work.  It will perjure, fabricate, falsify; seduce, bully,
cajole.  Resistance is protean.  It will assume any form, if
that is what it takes to deceive you.  It will reason with you
like a lawyer or jam a nine-millimeter in your face like a
stickup man.  Resistance has no conscience.  It will pledge
anything to get a deal, then double-cross you as soon as
your back is turned.  If you take resistance at its work,
you deserve everything you get.  Resistance is always
lying and always full of shit.


              Resistance and Procrastination

Procrastination is the most common manifestation of
Resistance because it's the easiest to rationalize.  We
don't tell ourselves, "I'm never going to write my
symphony."  Instead we say, "I am going to write my
symphony' I'm just going to start tomorrow."


Tomorrow's posts will include an excerpt on how
to combat resistance by "Turning Pro".

This is a book worth spending time with.

"There’s too much hand-wringing in the housing industry about things they cannot control...."

Mathew Ferrara delivers a stern pep talk- here

Key excerpt here:

"Only a serious business plan with strict standards of profit
and performance can keep real estate professionals from
spinning out of control these days. If other businesses in
economic segments at higher risk to consumer discretionary
spending can turn a profit, real estate agents should be able
to do the same. What matters is how serious they are about
doing good business, regardless of the market. And that
means focusing on the things that REALTORS can control..."

Gaping Void chimes in...........

Bill McBride and his fabulous charts...............

The thesis is simple.  Less then six months inventory of
available houses to be bought- prices go up.  More than six
months inventory of available houses to be bought- prices go
down.  McBride's blog is CalculatedRisk. His brief essay on
the thesis is here.

We are currently experiencing a +/- 12  month inventory of
houses available for purchase.  Prices most likely will continue to
trend lower.  The spike upward in pricing earlier this year, which
would seem to defy the thesis, is most likely the result of the
government's now expired tax credit program

The black line represents pricing.  The blue line represents
inventory.  Pretty interesting correlation, here:

Thursday, August 19, 2010

14,291,709 views can't be wrong......

"..flation Investing"

My favorite economic futurist poses the question, summarizes
both sides of the coin, but doesn't answer the question.

Time for each of us to reason this thing out for ourselves.  Fun!

" ....a fine and manly word, now ruined...."

TigerHawk tries to defend our language- here

More fun with language..........

with Jessica.

This is how we create "pent up demand".......

It is not news that housing starts have fallen off a cliff.

A handy chart from Calculated Risk  here, and below.

The red line represents single family spec construction.
The blue line represents single family owner built.
The brown line represents rental construction.
The green line represents condo construction.

The vertical blue lines represent recessions.  It is interesting
to note that housing starts were plummeting well before the
current recession's commencement date.

There will come a time when the trend lines start going
upward again.  Patience.

Wednesday, August 18, 2010

What a thrill...............

The Professor writes back.............

From Perfectly Reasonable Deviations From The Beaten Track:
The Letters Of Richard P. Feynman, a letter dated 11/30/65

Dear Miss Szabados:
     Thank you very much for your kind note about my lectures.
I am glad you like them, and glad you took the time to write to
me and tell me.  It seems to me that there is some chance that
you may be successful since you say you have not studied
physics in a disciplined fashion.  So much the better, but study
hard what interests you the most in the most undisciplined,
irreverent and original manner possible.
     Best of luck in your endeavor.
     Sincerely yours,
     Richard P. Feynman

Morning's glory..................

"We're going to have crisis alongside recovery."

From David Bodamer at Traffic Court- here

"Two weeks ago, I posted when Time, MSNBC and Fortune
almost simultaneously looked at aspects of commercial real
estate and proclaimed signs of recovery.

In the latest dispatches, however, we’re back to commercial
real estate being doomed again–at least according to this
segment on CNBC.

The lesson, again, is that commercial real estate is a complex
business with lots of moving parts. We’re going to have crisis
alongside recovery. There’s no simple narrative to be had here.
We’re not going to see a clear commercial real estate recovery
nor are we going to come upon a moment where all is
collapsing. So let’s stop looking for the one-line takeaways
about commercial real estate."

All that rooting for inflation hasn't seemed to have worked.........yet

Calculated Risk posts a fun chart showing that the inflation rate
is trending under 1%- here

Tuesday, August 17, 2010

Still young...............

I suppose "tougher" is relative.............

The Wall Street Journal runs a story about FHA tightening their
lending standards, here.

Interesting excerpt here:

"The FHA would require borrowers to have at least a 500 score
for FHA backing. At 580 and above, borrowers would be
eligible for the 3.5% down payment. But those who fall between
500 and 580 would see their down payments jump to 10%.

That, however, is still well below scores of 660 to 720 that most
lenders look for to accept only a 10% down payment. "No
lender is going to do that loan for a borrower with a 580 score
and only 10% down," says Christopher Gardner, chief executive
of FHA Pros, an FHA approval service.

For the FHA, "this change is dramatic," the quarterly report said.
Among borrowers with scores below 580, loans 90 days in
arrears, what FHA calls "seriously delinquent," have been three
times as high as those for borrowers with scores above 580, the
FHA said. Of the total FHA loan portfolio, some 6% are to
borrowers who had scores below 580 at the time of origination,
FHA Commissioner David Stevens told a House subcommittee
in March."

That "this change is dramatic" speaks volumes.

On the same topic.............this may take your breath away

Came across the quote while enjoying a Monday Morning
Cup of Coffee with the folks at the HousingWire- here

"This is an important update, because every mortgage loan
delivered to Fannie Mae has to be underwritten to establish
that the borrower is able to repay the debt," said Deborah
Slade-Horsey, vice president for Single-Family Risk Policy at
Fannie Mae.

"able to repay the debt".....what a novel idea from Fannie Mae.

Golf as life......................

After watching the compelling PGA golf tournament this past
weekend, and just having recently finished Steven Pressfield's
The War of Art, I felt compelled to take Pressfield's
The Legend of Bagger Vance off the shelf for a re-reading.
The Legend of Bagger Vance is essentially the re-telling of
the Bhagavad-Gita for modern America, via a golf match. 
Pressfield is a great teacher.

An excerpt:

" 'Therefore, Junah, love your opponents.  When I say love, I
don't mean hand them the match.  I mean contend with them to
the death, the way the lion battles a bear, without mercy but with
infinite respect.  Never belittle an opponent in your mind, rather
build him up, for on the plane of the Self there can be no distinc-
tion between your being and his.  Be grateful for your opponents'
excellence.  Applaud their brilliance.  For the greatness of the
hero is measured by that of his adversaries.  In this too the eti-
quette and honor of golf reflect the Reality of the Field.  Those
new to the game often cheer an opponent's misfortune, but the
player of wisdom who has entered into the soul of the game
schools himself to feel and act the opposite.  This too is the
greatness of the game.

     'But all this you know, Junah.  I repeat it now only to focus
your distracted mind under this excruciating pressure. To return
you to the imperative to act.'

     Here Junah, who had been listening with as much attention as
he could muster under the circumstances, bridled and pulled up
in midstride.  'I don't understand you, Bagger,' he said.  'You
order me to win, as if I could, but in the same breath you tell me
to love my opponents.  Please be clear.  I need to understand
what you're telling me.'

     'Act, Junah, but act without attachment, as the earth does.
As I do.  The rain falls, with no thought of watering the land.  The
clouds roll, not seeking to bring shade.  They simply do.  And we
must too.

     'Therefore win, Junah.  Hold nothing back.  It was not by ac-
cident that I told you to hook that ball out of bounds, nor was it
chance that made me tell you to hit the ball on ten with all you

     'We've got Hagen and Jones right where we want them: so
far ahead that they leave us no choice but to play all-out.  To
strike and act without fear or forethought.'

     'You confuse me again,' Junah interrupted.  'How can we
act without forethought?  What you're saying sounds like
mystical nonsense!  Why did God give us a brain if not to

     'Watch and see,' Bagger Vance answered calmly.  'I
will show you the Field and the Knower.' "

I wonder what my Mom did with my old coonskin cap.............

Davy Crockett was born August 17, 1786.  The frontiersman,
soldier, Congressman, and folk hero died at the Alamo in 1836.

Fess Parker, who brought Davy to life, was born August 16,
1924.  He died this past March.

Monday, August 16, 2010

We were all so young, back then...........

I saw a sign, while driving through the Holmes and Knox County countryside yesterday, protesting.............

....the recently passed health care bill.  It equated the passage of
"Obamacare" to a loss of liberty, and in that equation found a
reason for outrage.

I've posted before about the "Patient Protection and Affordable
Care Act ", and have nothing new to add to the conversation.

But....the sign did stir an interest in thinking about "liberty".  After
driving another ten miles, I came to the conclusion that thinking
is hard work and thinking about liberty is even harder work.

Some thought threads floated to the surface that deserve more
time and effort.  For instance- the relationship between liberty
and personal responsibility, the relationship between liberty and
the willingness to accept risk and it's attendant consequences,
the pooling of risk (insurance) and its impact on liberty, the
nature of our complex society and its balancing act of
competing "rights", and finally, this notion from the Declaration
of Independence:

"...they are endowed by their Creator with certain unalienable
rights, that among these are life, liberty and the pursuit of
happiness. That to secure these rights, governments are
instituted among men...."

With all due respect to Thomas Jefferson, one of my true heroes
and a man way smarter than me, an "unalienable right" that is
secured by government instituted among men, would seem to be
a "right" up for constant negotiation.

Anyway, while I was thinking about complexity and population
and competing interests, traffic ahead of me slowed and then
almost, but not quite, stopped.  Turns out that we were sharing
the road with an Amish couple driving a one-horse cart.  I had
to laugh.  So much for complexity and competing interests.

John Stuart Mill, "On Liberty"

An excerpt: 

"This, then is the appropriate region of human liberty.  It
comprises first, the inward domain of consciousness, demanding
liberty of conscience in the most comprehensive sense, liberty of
thought and feeling, absolute freedom of opinion and sentiment
on all subjects, practical or speculative, scientific, moral, or
theological.  The liberty of expressing and publishing opinions
may seem to fall under a different principle, since it belongs to
that part of the conduct of an individual which concerns other
people, but, being almost of as much importance as the liberty
of thought itself and resting in great part on the same reasons, is
practically inseparable from it.  Secondly, the principle requires
liberty of tastes and pursuits, of framing the plan of our life to
suit our own character, of doing as we like, subject to such
consequences as may follow, without impediment from our
fellow creatures, so long as what we do does not harm them,
even though they should think our conduct foolish, perverse, or
wrong.  Thirdly, from this liberty of each individual follows the
liberty, within the same limits, of combination among individuals;
freedom to unite for any purpose not involving harm to others:
the persons combining being supposed to be of full age and
not forced or deceived.
     No society in which these liberties are not, on the whole,
respected is free, whatever may be its form of government; and
none is completely free in which they do not exist absolute and
unqualified.  The only freedom which deserves the name is that
of pursuing our own good in our own way, so long as we do not
attempt to deprive others of theirs or impede their efforts to
obtain it."

On Liberty, John Stuart Mill

I don't know about you..................

...but I have become a Dustin Johnson fan.

Story here and here

A Poem for Monday..............

Poet's Prayer

If I write another poem
let it be about love,
not the crazy love
we all start out writing about
but the love that keeps us sane,
the love that pain reveals
at a funeral
or when the doctor says what we don't want to hear;
the love that men won't talk about,
of work, of games, of one another;
the love of divorced people
when they find their way back to marriage;
the love of an old family place
when the generations gather there;
the love of old friends
who realize they're the only ones left;
and the love of children,
not only when they're smiling or sleeping
or clean or straight or strong or smart,
but when they are none of those things
and need more love than anyone can give,
and cannot even recognize the love they get.

-James A. Autry

Thanks to E. for pointing the way

Sunday, August 15, 2010

"...I heard he had a style..... And so I came to see him and listen for awhile..."

Deal Junkie points to a "pretty confident" voice.......

My favorite part is where (2:50 minutes in) they talk about the
"ability of somebody to pay their rent".

Video here

Thomas Paine had a lot to say...............

The following is an excerpt from his Common Sense:

"The infant state of the Colonies, as it is called, so far from
being against, is an argument in favor of Independence.  We
are sufficiently numerous, and were we more so, we might be
less united.  It is a matter worthy of observation, that the more
a country is peopled, the smaller their armies are. In military
matters, the ancients far exceeded the moderns: and the
reason is evident, for trade being the consequence of population,
men become too much absorbed thereby to attend to anything
else.  Commerce diminishes the spirit, both of patriotism and
military defence.  And history sufficiently informs us, that the
bravest achievements were always accomplished in the non-age
of a nation.  With the increase of commerce, England hath lost
its spirit.  The city of London, notwithstanding its numbers, sub-
mits to continued insults with the patience of a coward.  The
more men have to lose, the less willing they are to venture.
the rich are in general slaves to fear, and submit to courtly
power with the trembling duplicity of a Spaniel."

A Verse for Sunday......

2.  Tzu-chang asked Master K'ung, saying, What must a man do,
that he may thereby be fitted to govern the land?  The Master
said, He must pay attention to the Five Lovely Things and put
away from him the Four Ugly Things.  Tzu-change said, What are
they, that you call the Five Lovely Things?  The Master said, A
gentleman 'can be bounteous without extravagance, can get work
out of people without arousing resentment, has longings but is
never covetous, it proud but never insolent, inspires awe but is
never ferocious.'
       Tzu-chang said, What is meant by being bounteous without
extravagance?  The Master said, If he gives to the people only
such advantage as are really advantageous to them, is he not
being bounteous without extravagance?  If he impose upon them
only such tasks as they are capable of performing, is he not getting
work out of them without  arousing resentment?  If what he longs
for and what he gets is Goodness, who can say that he is
covetous?  A gentleman, irrespective of whether he is dealing with
many persons or with few, with the small or with the great, never
presumes to slight them.  Is not this indeed being 'proud without
insolence'?  A gentleman sees to it that his clothes and hat are on
straight, and imparts such dignity to his gaze that he imposes on
others.  No sooner do they see him from afar that they are in awe.
Is not this indeed inspiring awe without ferocity?
     Tzu-change said, What are they, that you call the Four Ugly
Things.  The Master said, Putting men to death, without having
taught them (the Right); that is called savagery.  Expecting the
completion of tasks, without giving due warning; that is called
oppression.  To be dilatory about giving orders, but to expect
absolute punctuality, that is called being a tormentor.  And
similarly, though meaning to let a man have something, to be
grudging about bringing it out from within, that is called
behaving like a petty functionary.

-The Analects of Confucius, Book XX

For all you Keynesians out there.................... is someone not so impressed with the theory- or
practice.  Full essay here.  Excerpt here:

"Unfortunately, today the U.S. Federal balance sheet has
exploded and all of the 'stimulus' has produced underwhelming
results thus far. The fantastical multiplier effect of government
spending under the Keynesian model is demonstrably not
meeting expectations. A theory which says that a large
government body can deploy capital more effectively and
efficiently than a private individual simply has no merit.
Government cannot do things better than the private sector
can. For example, in New York, Off Track Betting is the only
bookie joint in history that looses money. The amount of waste,
fraud and abuse imbedded in government oversight can simply
not be denied. Every dollar the government spends is 'taken'
from a private individual (in one form or another) and how much
of that dollar gets put back into the economy after taking into
consideration 'administrative costs', waste, fraud and abuse?
 Recent economic data seems to provide clear evidence that
Keynesian theory does not work."