A simple thing.........................................

Dave Mason............Shouldn't Have Took More Than You Gave

 

For the love of the sea............................

Simon Winchester, a man who has penned some wonderful books, relates his, and mankind's, long love affair with the seas- here.  A wee excerpt:

He sat up, sighed, then closed his book with an awful finality. He removed his spectacles and leaned toward me. “I regret to have to tell you that Her Majesty takes a somewhat dim view”—he paused here, evidently hoping to lighten the mood before plunging in the dirk—“of young officers trying to drive her extremely expensive warships around the world when they cannot tell red from green, and thus the left from the right. Port from starboard. Your color-blindness, I am sorry to say, ensures you will never join the Royal Navy.”

If you have never read any of Winchester's books - do.  I would recommend  The Map That Changed the World: William Smith and the Birth of Modern Geology, The Meaning of Everything: The Story of the Oxford English Dictionary,  Krakatoa: The Day the World Exploded, or The Professor and The Madman

Opening paragraphs.......................

The trawler plunged into the angry swells of the dark, furious sea like an awkward animal trying desperately to break out of an impenetrable swamp.  The waves rose to goliathan heights, crashing into the hull with the power of raw tonnage; the white sprays caught in the night sky cascaded downward over the deck under the force of the night wind.  Everywhere there were the sounds of inanimate pain, wood straining against wood, ropes twisting, stretched to the breaking point.  The animal was dying.
-Robert Ludlum,   The Bourne Identity

Fifty years ago...................................

Walt Disney................................The Son of Flubber

 

Baking a bigger pie.......................................

Wealth Creation:  An economic miracle made possible by the free enterprise system.

The Free Enterprise System: The combination of  entrepreneurialism, the sanctity of contracts, enforceable private property rights, the rule of law, and responsible government (somebody has to take care of  the road and bridges, the water and sewer systems, the police and fire protection, the schools, etc.).

An example:

"In 1931, Wall Street tycoon, physicist, and patron of scientific research, Alfred Lee Loomis along with his brother-in-law and partner, Landon K. Thorne, purchased 17,000 acres (69 km²) on the island (over 63% of the total land mass) for about $120,000 to be used as a private game reserve.^{[27][28]"  -Wikipedia}

In 1950 the population of Hilton Head Island was about 300 people.  Access to the island was limited to private boats or a ferry.  Timbering and fishing was the mainstay of the local economy.  In 1956 the first bridge from the mainland to the island was built, at a cost of $1,500,000. (I bet the local politics behind that decision were interesting).  In 1957 the development of Sea Pines, the first resort development on the island commenced.

Flash forward............less than sixty years later:

In 2010 there are 33,306 housing units on the island.  Based on the chart from whence that statistic came, it would appear that about half of the residences are occupied full time by their owner.  The other half are mostly rentals and season second homes.  (I suspect that the total number of "Seasonal, recreational, or occasional use" housing units includes the +/- 6,559 total rooms in the 58 hotel/motels on the island, but don't know for sure.)

On Hilton Head (some 42 square miles of land) there is a broad mix of residential uses.  There are house trailers on postage stamp lots and there are two million dollar beach front homes.  There are plentiful condominium projects and there are typical single family home sub-divisions.  Not knowing this market, and not having seen any true statistics, your faithful blogger is going to make the wild guess (plus it makes the math easier) that the average housing unit (including the hotel rooms) has a value of $150,000.

On Hilton Head Island there is also a broad mix of commercial developments, including countless restaurants, marinas, golf courses, retail stores of all sizes, office buildings, schools, government buildings, etc.

So, in sixty years we have magically gone from an almost unoccupied island, used mostly for timbering, to a place with (give or take a bit) about FIVE BILLION DOLLARS worth of residential real estate and perhaps a lot more than another ONE BILLION DOLLARS worth of commercial real estate.

More than two million people come visit Hilton Head annually.  Said visitors reportedly spend about 1.5 billion dollars while on the island.  Based on my experience, that spending number is more than a little light.

Wealth creation (and lots of family fun along the way) via the free enterprise system.   There is nothing like it in this world.  Thank thee kindly.

33 Guidelines to investing in real estate...............

Guideline #11:  Good management makes good investments.

Real estate is not a passive investment.  Successful investments require steady and competent management.  A few trademarks of good management:  proper screening of tenants, keeping occupancy levels high, making sure the rental rates remain market appropriate over time, taking care of day-to-day maintenance, anticipating - and budgeting for - capital improvements, anticipating and solving problems, communicating sooner rather than later, and not letting issues fester.

It is not difficult.  It does require discipline and effort.  It is important.

"A Newe Northen Dittye of ye Ladye Greene Sleves"

Mason Williams...........................................Greensleeves

 


Greensleeves, which dates to the 16th Century, is wikified here

Opening paragraphs.......................

     They came for her in late August, on the island of Corsica.  The precise time would never be determined - some point between sunset and noon the following day was the best any of her housemates could do.  Sunset was when they saw her for the last time, streaking down the drive of the villa on a red motor scooter, a gauzy cotton skirt fluttering about her suntanned thighs.  Noon was when they realized her bed was empty except for a trashy half-read paperback novel that smelled of coconut oil and faintly of rum.  Another twenty-four hours would elapse before they got around to calling the gendarmes.  It had been that kind of summer, and Madeline was that kind of girl.
-Daniel Silva,  The English Girl

When I first started reading "self-help" books.......

.......(a long, long time ago)  I was startled by the claim that only 5% of our population was (or would become) financially independent.  In the land of opportunity, how could this be true?  Those early gurus stressed that it was the habits we adopted as individuals that would make it so.  So it was with some interest that I followed a link to this list of 20 Things The Rich Do Everyday.  It is a list that Napoleon Hill, Dale Carnegie, or Earl Nightingale could have written.  Take a peek.

thanks Glenn

Fifty years ago......................................

The Beatles......................................Devil In Her Heart

A rock star preaches capitalism.............

I had the short video clip of Bono speaking about Africa and capitalism embedded here.  Every time I opened the blog it would randomly start playing.  Very annoying.  Not knowing how to make it stop doing that, I removed it.  Go here to watch the video.
"Commerce is real. That’s what you’re about here and it’s real. Aid is just a stop-gap. Commerce, entrepreneurial capitalism, takes more people out of poverty than aid, of course we know that."
-Bono

thanks Brian

33 Guidelines for investing in real estate................

Guideline #10:  These are business relationships, not friendships.

Landlords and tenants have a relationship based on a business contract, not friendship.   Likewise, Lenders and Borrowers have a relationship based on a business contract, not friendship.

Forget this at your peril:  read, understand, and respect the fine print.

Personally, I use a yellow hi-liter.................

“Her library would have been valuable to a bibliophile except she treated her books execrably. I would rarely open a volume that she had not desecrated by underlining her favorite sections with a ball-point pen. Once I had told her that I would rather see a museum bombed than a book underlined, but she dismissed my argument as mere sentimentality. She marked her books so that stunning images and ideas would not be lost to her.” 
-Pat Conroy,  The Prince of Tides

As ex-presidents go........................

........................he has really been a good one.

back story here and here....................................

For Ray and Doug

Five Finger Death Punch.............................Bad Company

 

The boys are doing just fine...............

One of the glories of the Intertunnel is that you can become friends with people you've never met and who live a gazillion miles away.  Three years ago, just before our family ventured off to a  Hilton Head vacation, I contacted Doug Fine, the wizard behind the curtain of the Electicity blogs, and Ray Visotski, the not-so-simple Village Undertaker, and suggested we meet up somewhere in South Carolina.  Ray did the research and found this Lobster House place in Allendale, about half way between Aiken and Hilton Head.  Last night we convened our third annual  get together there.  As always fried pickles, cheeseburgers, and beers were on the menu.  We spent a brief few hours catching up on family, friends, business, blogging, music (including picking some obscure -to me -tunes on the jukebox), and politics. Interestingly, all three of us have our youngest child entering college this fall.  A most enjoyable evening.  Thanks guys.

The Lobster House Restaurant in Allendale, S.C. has gone many a year without seeing either a lobster or a paint job.

The entranceway to the Lobster House.  My kind of "private club."

Steve (wearing his prized new Masters 2012 ball cap - thanks Doug), Ray, and Doug inside the Lobster House.  Karen took fine care of us.

Unknowable............................................

Mason Jennings................I Love You And Buddha Too

 

Contented....................................

“Books are living things and their task lies in their vows of silence. You touch them as they quiver with a divine pleasure. You read them and they fall asleep to happy dreams for the next 10 years. If you do them the favor of understanding them, of taking in their portions of grief and wisdom, then they settle down in contented residence in your heart.” 
-Pat Conroy

image via

Learning something new today.............................

Us midwesterners have limited experience with tides, although I've known forever that the gravitational pull of the moon as it orbits the earth causes the high and low tides.  The high tide at Hilton Head this morning seemed excessively high.  Commenting about it to the nice beach patrol person, she responded that it was because of the full moon.  Oh.  Then the thought:  Wait a minute, the moon doesn't change.  It is always the same size.  It is only the play of the sun on it that makes if crescent or full.  My Sweetie said, "Well, you can google it when we get back to the condo."  Wise woman.  Turns out that the Sun also affects tides, just to a lesser degree because of its distance.  When the Sun and Moon are aligned in a certain way, such as during the full Moon, their gravitational pulls are in tandem, thus increasing their impact on the tides.  In case you want more about tides:

Because the tides are influenced by both the Moon and the Sun, it's easy to see that when the Sun lines up with the Moon and the Earth, as during a New Moon or Full Moon (a configuration also called "syzygy"), the tidal effect is increased. These are known as spring tides, named not for the season, but for the fact that the water "springs" higher than normal.

On the other hand, if the Sun and the Moon are 90 degrees apart in relation to an observer on Earth as during the First Quarter Moon or Third Quarter Moon (sometimes called half moons), then high tides are not as high as they normally would be. This is because despite its greater distance, the Sun's mass allows it to exert enough gravitational force on the oceans that it can negate some of the effects of the Moon's pull. This phenomenon of lower high tides is called aneap tide.

The height of the tides can also vary during the course of a month because the Moon is not always the same distance from the Earth. As the Moon's orbit brings it in closer proximity to our planet (closest distance within a moon cycle is called perigee), its gravitational forces can increase by almost 50%, and this stronger force leads to high tides. Likewise, when the Moon is farther away from the Earth (furthest distance is called apogee), the tides are not as spectacular.

Fifty years ago.....................................

Ann-Margret/Dick Van Dyke/Janet Leigh.......Bye Bye Birdie

 

33 Guidelines to investing in real estate.............

Guideline #9:  If it is too good to be true, it probably isn't.

History is filled with stories of investment gurus, mavens, and promoters offering immediate returns well above the norm.  Many of those stories ultimately include ruin and jail time.

Unless you are doing something to add value to the process, real estate is an investment best suited to the long run.  Be very wary of "get rich quick" schemes and promises.

Every hand's a...............................

"Life is like a game of cards.  The hand that was dealt you is determinism;  the way you play it is free will."
-Jawaharlal Nehru

thanks todd

Now, here is an acceptance speech........

In December of 1974 Friedrich August von Hayek received the Nobel Memorial Prize in Economics.   Below you will find his classic acceptance speech.   Should be required reading.

Your Majesty, Your Royal Highnesses, Ladies and Gentlemen,

Now that the Nobel Memorial Prize for economic science has been created, one can only be profoundly grateful for having been selected as one of its joint recipients, and the economists certainly have every reason for being grateful to the Swedish Riksbank for regarding their subject as worthy of this high honour.

Yet I must confess that if I had been consulted whether to establish a Nobel Prize in economics, I should have decidedly advised against it.

One reason was that I feared that such a prize, as I believe is true of the activities of some of the great scientific foundations, would tend to accentuate the swings of scientific fashion.

This apprehension the selection committee has brilliantly refuted by awarding the prize to one whose views are as unfashionable as mine are.

I do not yet feel equally reassured concerning my second cause of apprehension.

It is that the Nobel Prize confers on an individual an authority which in economics no man ought to possess.

This does not matter in the natural sciences. Here the influence exercised by an individual is chiefly an influence on his fellow experts; and they will soon cut him down to size if he exceeds his competence.

But the influence of the economist that mainly matters is an influence over laymen: politicians, journalists, civil servants and the public generally.

There is no reason why a man who has made a distinctive contribution to economic science should be omnicompetent on all problems of society - as the press tends to treat him till in the end he may himself be persuaded to believe.

One is even made to feel it a public duty to pronounce on problems to which one may not have devoted special attention.

I am not sure that it is desirable to strengthen the influence of a few individual economists by such a ceremonial and eye-catching recognition of achievements, perhaps of the distant past.

I am therefore almost inclined to suggest that you require from your laureates an oath of humility, a sort of hippocratic oath, never to exceed in public pronouncements the limits of their competence.

Or you ought at least, on confering the prize, remind the recipient of the sage counsel of one of the great men in our subject, Alfred Marshall, who wrote:

"Students of social science, must fear popular approval: Evil is with them when all men speak well of them".

thanks to

Fare thee well...........................................

Mason Proffit.......................................Old Joe Clark

 

Trivia question for today.....................................

Who was Abraham Lincoln's running mate in 1860?

Fifty years ago...............................................

The Beach Boys...................................................409

33 Guidelines for investing in real estate.............

Guideline #8:  Survive your first investment.

The trick to being a long term investor in real estate, a true path to financial independence, is to survive that first investment.  Pay attention to both your comfort and your competency zones

Unless you have invested in a partnership sort of venture where someone else has accepted the management responsibilities, directly owning investment real estate is not without hassles.  Maintenance issues and tenant issues can be wearing.

Most successful investors are in for the long haul.  Getting rich quickly might be accomplished by selling videos via late night TV on how to get rich quickly in real estate, but, from my observation and experience, a solid foundation of wealth from investing comes slowly but steadily.

Accept that it will take time.  Be patient.  Be prudent.  Stay with it.  Make the second (and third, and fourth, etc) investments.

While vacationing.......................

Fort Sumter on Monday as the tour boat takes us back to Charleston

The actual American Flag that was flying over Fort Sumter when the first shots of the Civll War were fired on April 12, 1861

..........in sunny South Carolina, my Sweetie humored me and agreed to a day trip to Charleston and Fort Sumter.   In 2013, forts controlling harbors don't seem to be all that important.  For much of our nation's history, however, such forts were very important.  In the mid-1800's Charleston was THE major port south of Philadelphia.  Very strategic, very important, and very prosperous.  Sumter sits on a teeny island right in the middle of the passage from the Atlantic Ocean to the harbor.  In late December of 1860, a Federal detachment  moved from a fort on the north shore of the harbor entrance onto Fort Sumter; a moved that truly upset the seceding Charlestonians.  The South Carolina militia began an artillery bombardment of the island on April 12, 1861.  Less than two days later, the Federal troops surrendered (with no casualties, but also with little prospects for successfully surviving) and the Civil War was on.  Very little of the original fort survived the war.  For almost two years between 1863-1865, Union forces attacked the fort with artillery, laying waste to most of the original structure.

A wee slice of history...........................

 

Hannibal Hamlin (1809-1891) was Abraham Lincoln's running mate for the presidential election of 1860.  Hamlin and Lincoln did not meet until after the election.  Hamlin, a Maine man, won his first political in 1836, when he was elected to the Maine House of Representatives.  Over his political career he was a Congressman, a Senator, and a Governor.  Our nation's history might be very different if Hamlin had been VP to Lincoln in the 1864 election, but he got bounced from the ticket to make room for Andrew Johnson.  That didn't turn out so well.  Not sure how good a VP Hamlin was, but you can read about him here. Hamlin's wiki attributes to him this quote about being Vice President: "I am only a fifth wheel of a coach and can do little for my friends." ^[2]

Bonus historical trivia:  The voter turnout rate in 1860 was the second-highest on record (81.2%, second only to 1876, with 81.8%).

Dickens on money and happiness........

"My other piece of advice, Copperfield," said Mr. Micawber, "you know.  Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness.  Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.  The blossom is blighted, the leaf is withered, the God of day goes down upon the dreary scene, and - and in short you are forever floored.  As I am!"
-Charles Dickens,  David Copperfield

On the brink..........................................

Dave Mason.................................Show Me Some Affection

 

Fashions.......................................

     I preceded Mr. Omer, in compliance with his request;  and after showing me a roll of cloth which he said was extra super, and too good mourning for anything short of parents, he took my various dimensions, and put them down in a book.  While he was recording them he called my attention to his stock-in-trade, and to certain fashions which he said had "just come up," and to certain other fashions which he said had "just gone out."
     "And by that sort of thing we often lose a little mint of money," said Mr. Omer.  "But fashions are like human beings.  They come in, nobody knows when, why, or how;  and they go out, nobody knows when, why, or how.  Everything is like life, in my opinion, if you look at it from that point of view."
     I was too sorrowful to discuss the question, which would possibly have been beyond me under any circumstances;  and Mr. Omer took me back into the parlour, breathing with some difficulty on the way.
-Charles Dickens,  as excerpted from David Copperfield

Fifty years ago.....................................

Alfred Newman.............The Overture to How the West Was Won

 

33 Guidelines for investing in real estate..........................

Guideline #7:  There is no bad real estate, only wrong owners.

There is no such thing as bad real estate.  Surprisingly, there is often a wrong owner.

A wrong owner is someone who, among other things,............
          ...has lost interest in maintaining the property,
          ...cannot afford to maintain the property,
          ...bleeds the property to death,
          ...ignores legitimate tenant issues,
          ...is overwhelmed by the responsibilities of ownership.

Two thoughts:   If you do not feel good about a particular investment property, don't own it.  As an investor, buying from "wrong owners" can be a good thing.

Rube Goldberg updated...................................

b

Not straight...............................

“No story is a straight line. The geometry of a human life is too imperfect and complex, too distorted by the laughter of time and the bewildering intricacies of fate to admit the straight line into its system of laws.” 
-Pat Conroy,  Beach Music

via

Back in 1968..............................................

Mason Williams, et. al.....................................Classical Gas

 

Timing..............................................

“Except for memory, time would have no meaning at all.” 
-Pat Conroy,  as excerpted from Beach Music

Science..................................................

“Science may be described as the art of systematic oversimplification.” 
-Karl Popper

Fifty years ago...............................

The Beatles.................................................Little Child

33 Guidelines for investing in real estate..................

Guideline #6:  Know what you are, and are not, buying.

There is a reason why purchase agreements have "due diligence" clauses.

Paragraph 3 (a) of  our standard contract contains the "boiler plate" list of contingencies - things we, and our clients, need to review, inspect, and generally be aware of before agreeing to buy.  Here is the list:

"......environmental site assessment, appraisal, wood destroying insect inspection, well and septic inspection, gas line inspection, zoning and building code compliance, soil and wetlands study, soil compaction analysis, lot line location, inspection of the structural condition of the improvements, mechanical systems review, roof inspection, flood plain impact, utility availability and capacity, curb cut and access availability, lease and rental review, and economic viability analysis."

The "boiler plate"  is a generalized list.  Specific properties may require additional inspections (for example, if one is buying wooded land, a timber consultant should be engaged), and obviously the entire list does not apply to all investments, but using those that do apply, and then adding the title insurance commitment (to identify easements and other potential restrictions to the use of the property) and a survey, and your general knowledge of the property now enables better decision making.

Sometimes general knowledge is not enough.  With the emergence of "shale" and fracking, a new awareness of, and respect for, mineral rights has emerged in our part of the world.  Just be aware that your normal title insurance policy contains an exclusion concerning mineral rights.  A much more detailed, and costly, title search is required.  Many land owners are truly unaware of the true status of their mineral rights.

Surprises are not generally considered a good thing in our business. Don't rely on the Seller's say so, or your gut instinct.  Hire competent professionals and have them inspect, inspect, inspect. As they say at Faber College, "Knowledge is Good."

Beauty......................................

Jetboy's in a groove..................................

Anders Osborne's On the Road To Charlie Parker....."You're livin' on a ledge, afraid of the edge"

Maybe...............................................

thanks jonco

A little stand-up.....................................

Robin Williams.......................................

 

Something beautiful........................................

Charlie Parker.....................................Meandering

 

Hate it when that happens..................

thanks todd

Grace under pressure...................................

via

33 Guidelines for investing in real estate.............

Guideline #5:   Location, location, location.

One very important word that bears repeating again and again makes up Guideline #5.

Location, location, location.

All real estate is not created equal.
 
An acre of commercially zoned land, on a busy commercial street, situated on the far corner of an intersection with a traffic light, may be worth twice as much as the acre adjacent to it that is not at the corner.  It might be worth ten times as much as an acre located a half mile away on a side street.  The same general theory applies to residential real estate.  Some neighborhoods better support home values than others.

It is mighty important to remember, however, that real estate assets are fixed to a specific location, and the specific location is fixed to a specific neighborhood, and the specific neighborhood is fixed to a specific community.   A fabulous location today may not be so fabulous twenty-five years from now.  On the positive side: a new road, a new mall, a new industry moving in just outside of town can all impact values - making winners and losers.  On the negative side:  think Detroit.

Investing in a community that is focused on growth and improvement is a good idea.  Being realistic about the nature, and future prospects, of the location is a better idea.  

Don't forget Guideline #4.

Fifty years ago...................................

Alfred Hitchcock.......................................The Birds

Charles Dickens and "caul".................

Your faithful blogger has become entranced by the writing of Charles Dickens.  People just don't write that way anymore.  Our loss.  The paragraph posted below comes from the first chapter of David Copperfield.  I had zero idea of what a "caul" was.  Since the word is central to the paragraph, I hazarded an incorrect guess or two, but kept reading.  I've committed myself to reading a minimum of five chapters of Dickens per day this week, and thought I dare not stop.  Flexing the old discipline muscle.  Check in next week.  I'll let you know how it went.

Anyway, after the fifth chapter was safely read, the Oracle Google was consulted concerning the word "caul:"

 A caul (Latin: Caput galeatum, literally, "helmeted head") is a piece of membrane that can cover a newborn's head and face.^[1] Birth with a caul is rare, occurring in fewer than 1 in 80,000 births. The caul is harmless and is immediately removed by the physician or midwife upon delivery of the child.

In medieval times the appearance of a caul on a newborn baby was seen as a sign of good luck.^[6] It was considered an omen that the child was destined for greatness. Gathering the caul onto paper was considered an important tradition of childbirth: the midwife would rub a sheet of paper across the baby's head and face, pressing the material of the caul onto the paper. The caul would then be presented to the mother, to be kept as an heirloom. Some Early Modern European traditions linked caul birth to the ability to defend fertility and the harvest against the forces of evil, particularly witches and sorcerers.^[7]

A legend developed suggesting that possession of a baby's caul would give its bearer good luck and protect that person from death by drowning. Cauls were therefore highly prized by sailors. Medieval women often sold these cauls to sailors for large sums of money; a caul was regarded as a valuable talisman.^[8]

Vain.........................................

     I was born with a caul, which was advertised for sale, in the newspapers, at the price of fifteen guineas.  Whether sea-going people were short of money about that time, or were short of faith and preferred cork jackets, I don't know; all I know is , that there was but one solitary bidding, and that was from an attorney connected with the bill-broking business, who offered two pounds in cash, and the balance in sherry, but declined to be guaranteed from drowning on any higher bargain.  Consequently the advertisement was withdrawn at a dead loss - for as to sherry, my poor dear mother's own sherry was in the market then - and ten years afterwards the caul was put up in a raffle down in our part of the country, up to fifty members at half-a-crown a head, the winner to spend five shillings.  I was present myself, and I remember to have felt quite uncomfortable and confused, a part of myself being disposed of in that way.  The caul was one, I recollect by an old lady with a hand-basket, who, very reluctantly, produced from it the stipulated five shillings, all in halfpence, and twopence-halfpenny short - as it took and immense time and a great waste of arithmetic, to endeavour without any effect to prove to her. It is a fact which will be long remembered as remarkable down there, that she never drowned, but died triumphantly in bed, at ninety-two.  I have understood that it was, to the last, her proudest boast, that she never had been on the water in her life, except upon a bridge; and that over her tea (to which she was extremely partial) she, to the last, expressed her indignation at the impiety of mariners and others, who had the presumption to go "meandering" around the world.  It was in vain to represent to her that some conveniences, tea perhaps included, resulted from this objectionable practice.  She always returned, with greater emphasis and with an instinctive knowledge of the strength of her objection, "Let us have no meandering."
-Charles Dickens,  David Copperfield

Meandering..................................

Best...........................................