Saturday, July 17, 2010

Been feeling a bit whiny lately. Time to change that. It's time to Celebrate this Wonderful World!!!!!!

Does it really matter who says it..................

...........if it is still true?

Discussion on authorship here and here.

Some wisdom about real estate investing.............

Gordon Whiting of Angelo, Gordon & Co., pinpoints a
most important characteristic of real estate investments:

"The strength of the industrial market today is still market
specific and varies depending on the location and type of
industrial asset."

In other words, a real estate investment is not a securtiy.
You are not buying a piece of paper (i.e. a lease), you
are buying bricks and steel and concrete and dirt in a fixed
location plus, hopefully,  a lease.  Each investment is
different.  Each one needs to be evaluated on its own.

Interestingly, Whiting figures that cap rates should be in the
double digits, and that it is a good time to buy.  Cap
rates in the double figures would mean much lower selling
prices than were available in 2006-2007.   Faithful readers
of this blog will know that I think that Whiting is correct. 

Full essay here.

It is way past time to start swimming..................

About the only TV shows Mom would let me watch when I was 8.....

Well, that's one way of looking at it.......

from the folks at finerminds

Friday, July 16, 2010

Coming to the Midland on September 17th...................

By what definition is this leadership?

An excerpt from an AP news story in the Newark Advocate
about the coming  "financial reform bill":

"Reid as much as acknowledged that political reality Tuesday,
blaming "greed on Wall Street" for the country's economic
troubles. "It triggered the recession," he said. "It's what
suffocated the job market and robbed trillions of dollars of
people's savings — trillions."

A cheap, easy, and lazy sound bite with a degree of truth,
the staple of most politicians.  Not much in the way of
leadership, though, and not very useful.

We have just come through the bursting of a rather large
speculative real estate bubble.  We, as a nation, were more
than happy to reap (and spend) the rewards of fast rising
home values (and perceived or projected home equity).  We ,
as a nation, have been more than happy to pile on debt to
finance consumption.  We, as a nation, have been more than
willing to receive benefits we have neither earned nor paid for.

Politicians and lenders have been more than willing to
encourage these behaviors.  Wouldn't it be refreshing  if there
was a political leader with the good sense (and nerve) to
say to the American people, "sorry, but we have made
promises that we just can't keep.  It is time for both some
difficult choices and an acknowledgement that the
government cannot do it all."  

But........., it is so much easier to blame and demonize.
Then pass a two thousand plus page law that nobody has
read, or understands the consequences of,  that will invariably
be part of the problem when the next cyclical financial
storm strikes.

Harry Reid is probably a very nice man, a good politician,
and a true-blue Democrat.  A leader- I think not.

We're from the Government and we are here to help.......

Jeff Thredgold, my favorite ecomonic futurist says, "My simple
definition of economics is 'people respond to incentives.' The
disincentives to add jobs in this country remain formidable."

For those who care about such things, he elaborates:

"Job creation has been substandard during the past six months,
with seemingly not much improvement ahead. The following is
an update of where we stand at this point.

Business owners and managers of any size company see a
number of major impediments to new hiring over the next few

1) Higher and higher health care costs for their employees,
with more and more complex and costly government mandates
to come. Almost weekly, new and higher estimates of the costs
of Obamacare to the business sector are released, either by
various government departments or via private sector studies.
New information about all of the “hoops” that need to be
jumped through by employers in order to avoid penalties or
fines makes it simpler to look to shed workers, rather than to
add new employees.

2) Potential “cap & trade” legislation to boost business costs.
This is one more issue to keep managers awake at night. The good
news here is that a weakened Administration and Congress are
unlikely to move quickly in this area. At the same time, however,
talk of a Democratic “surprise” to pass new onerous “cap &
trade” legislation, as well as other items in December—between
the November 2 election day and the date new members of
Congress take office in early January-continues to rise. This could
be particularly likely if Republicans regain control of the House of
Representatives or the Senate, or both, in early November

3) Employers see sharply higher taxes on the horizon, one more
impediment to new job creation. Successful employers see
higher income tax rates coming, higher dividend tax rates
coming, higher capital gains tax rates coming, and a variety of
new taxes on investment income. Why bother to knock
yourself out?

4) Many states and local communities are imposing or will impose
greater costs on local businesses as a means of generating greater
“fee” income to help offset declines in sales taxes, property taxes,
and income taxes. Many already high-cost states will simply drive
their most valued businesses across state borders to more
“business friendly” environs.

5) Business owners and managers are fearful of government out
of control when it comes to budget deficits, and fear the longer-
term implications on their children and grandchildren.
Aggressive government spending and associated massive budget
deficits can be “justifiable” at times of great economic weakness.
However, excessive ongoing government spending and projected
budget deficits of $1 trillion annually for years to come are simply
too much."

How did she know?...........


Not sure how I feel about this picture...........

"A photograph shows the first atomic bomb test on July 16,
1945, at 5:30am at the Trinity Site in New Mexico. "
Story here and here.

Really good thinking.........

........about Gratitude, here

Thursday, July 15, 2010

Damned near perfection.................

Early morning mysteries...........

The nightmare coming our way.........Or, the accountant's full employment act.......Or, how many small businesses can we shutter this month........Or,

I'm giving up trying to put a name on this post.

The Internal Revenue Service's  National Tax Payer Advocate
issued a report to Congress on June 30, 2010.   You can find
it here.  

While it is 156  pages, if you just read pages 9 through 13
you will find some of the mischief created by the Patient
Protection and Affordable Care Act.

Teeny excerpt here:

"A provision in the Patient Protection and Affordable Care
Act (PPACA), enacted in March of this year, added a
new information reporting requirement that may present
significant administrative challenges to taxpayers and the
IRS. In particular, businesses will have to issue Forms
1099 for goods purchased after 2011, regardless of the
corporate form of the vendor."

"Significant administrative challenges"- the IRS itself is
scared of the increased reporting and paperwork.  Be
a good time to buy stock in a paper mill.

When I become King, any Congressperson who cannot
explain in layman's terms all the ramifications of the laws they
vote for, before they vote for them, will first forfeit their
their rights to any government pension.  The second time
they do it, they will henceforth receive, and pay for, health
care the same way the rest of us do

Of course, there is the chance they did this on purpose.

Creativity and Generosity in a connected age.........

Clay Shirky's latest book, Cognitive Surplus, is worth the time
investment if sharing and community interests you.  A video of
one of his talks opened the door for me, part one here and
part two here.  If you like these, you will like the book.

A few excerpts: 

Where we were:

"...the core of Gutenberg economics: enormous investment
costs.  It's expensive to own the means of production, whether
it is printing press or a TV tower, which makes novelty a
fundamentally high risk operation.  If it's expensive to own and
manage the means of production or if it requires a staff, you
are in the world of Gutenberg economics, whether you are a
Venetian publisher or a Hollywood producer, you're going to
have 15th Century risk management as well, where the producers
have to decide what's good before showing it to the audience."

Where we are:

"....the buildup of well over a trillion hours of free time each year
on the part of the world's educated population, and the invention
and spread of public media that enable ordinary citizens,
previously locked out, to pool that free time in pursuit of
activities they like or care about."

"As long as the assumed purpose of media is to allow ordinary
people to consume professionally created material, the pro-
liferation of amateur-created stuff will seem incomprehensible....
But what if, all this time, providing professional content isn't
the only job we've been hiring the media to do?  What if we've
also been hiring it to make us feel connected, engaged, or just
less lonely?  What if we've always wanted to produce as well
as consume, but no one offered us the opportunity?"

"The pleasure in You can play this game too isn't just in the
making, it's also in the sharing.......The sharing, in fact, is
what makes the making fun-...."

"Our ability to balance consumptions with production
and sharing, our ability to connect with one another, is
transforming the sense of media from a particular sector of
the economy to a cheap and globally available tool for
organizing sharing."

What if...........?    It's good stuff.

"de meeste en de natuurlijkste beweegelijkheid"......

Thus sayeth Rembrandt Harmenszoon von Rijn.  Our friends
at Wikipedia translate that as " 'the greatest and most natural
movement' although the word 'beweechgelickhijt' is also
argued to mean 'emotion' or 'motive.' Whether this refers to
objectives, material or otherwise is open to interpretation;
either way, Rembrandt seamlessly melded the earthly and
spiritual as has no other painter in Western art."

I am not an art critic, so I will take their word for it.
Rembrandt (July 15, 1606-October 4, 1669) is the
pre-eminent Dutch painter, etcher, and art teacher.

Had the good fortune to see some of his paintings during
a visit the Rijksmuseum in Amsterdam in the winter of 1972.
His greatness was palpable, even to this novice.

Wednesday, July 14, 2010

The voice of reason proposes an interesting tax law change.....

Jonathan D. Miller, who writes more better stuff than anybody
about commercial real estate, suggests that -horrors- our
tax code may have something to do with encouraging
speculative bubbles.  Full essay here.

Excerpts here:

"He places the blame for our short-sightedness on the tax system,
which gives investors no incentive to hold long-term."

"He suggests increasing and extending the short-term tax burden
on a sliding scale—making early year selling more punitive than
the current ordinary income rate (35%) and reducing the capital
gains tax to below the current 15% rate for extended holding
periods of ten years or more."

"The resulting change in business behavior could shift away from
always trying to make the quick killing to shaping businesses that
have staying power, invest in their employees, and take a greater
stake in local communities."

"It’s much easier to trade assets than create and build them into
something more. But easy money doesn’t usually endure......
witness recent history."

A community most generous..................

This blog has often noted the generous nature of the Newark
and Licking County Community.  We're going to do it again.

Dave Grigsby, a local builder and investor, noticed that the
landscaping around the Newark Public Library needed some
tending to.  On top of that, weeds infested the curbing, sidewalks,
and planting areas.  Thinking that our Library deserved  better,
and knowing the the Library has funding issues that preclude full
time landscaping, Grigsby volunteered a clean-up crew.   Today
brother, father and two sons worked diligently making the outside
of the Library look more attractive.  With no fanfare, all  labor and
materials were donated out of a sense of community pride. 

We live in a pretty special place.  Thank you!

Call me young and impressionable, but after seeing...........

....this commercial, I went out and bought a case of Michelob. 

Woody American original

Born this day in 1912.  A singer/song writer/musician worth celebrating.

My favorite bloggers posted the commencement address..............

of Amazon's Jeff Bezos (here and here).  When they say "read",
I read.  It is worth the investment of a few moments

A few more excerpts:

"What I want to talk to you about today is the difference between
gifts and choices. Cleverness is a gift, kindness is a choice. Gifts
are easy -- they're given after all. Choices can be hard. You can
seduce yourself with your gifts if you're not careful, and if you do,
it'll probably be to the detriment of your choices."

"Jules Verne, Mark Twain, Galileo, Newton -- all the curious from
the ages would have wanted to be alive most of all right now."

Tuesday, July 13, 2010

The Hammock Papers................................

I wish I had a few more teachers like this when I was in school.
A few samples, here, here,  here and here.

Thanks for the influences Rob.

Fun quotes from Mac Anderson's....................

You Can't Send a Duck to Eagle School: And Other Simple
Truths of Leadership:

"If your company mission is to climb a tree, which would you
rather do:  Hire a squirrel or train a horse?"

"Procrastination is attitude's natural assassin.  There's nothing
so fatiguing as an uncompleted task." 
-William James

"Change your thoughts and change your world."
-Earl Nightingale

"Focus on the critical few, and not the insignificant many."

"You never know when a moment and a few sincere
words can have an impact on a life."
-Zig Ziglar

"Burn brightly without burning out."

"Things that matter most must never be at the mercy
of things that matter least."

"In business, real discipline comes in saying 'No' to
the wrong opportunities."
-Jim Collins

"It's tempting to sit and wait for life to come to you.
But it can't, it's too busy.  Life is out there.  You have
to go for it."
-Harry Beckwith

"In the end, it is important to remember that we
cannot become what we need to be by remaining
who we are."
-Max Depree

This day can't come soon enough.........................

Rick Platt speculates on future labor shortages, here

Maybe this will help explain why our generation is the way it is.............

Monday, July 12, 2010

As always........................

..........................E. shows the way, here.

A poem for Monday..........

The Man Watching

I can tell by the way the trees beat, after
so many dull days, on my worried windowpanes
that a storm is coming,
and I hear the far-off fields say things
I can't bear without a friend,
I can't love without a sister.

The storm, the shifter of shapes, drives on
across the woods and across time,
and the world looks as if it had no age:
the landscape, like a line in the psalm book,
in seriousness and weight and eternity.

What we choose to fight is so tiny!
What fights with us is so great!
If only we would let ourselves be dominated
as things do by some immense storm,
we would become strong too, and not need names.

When we win it's with small things,
and the triumph itself makes us small.
What is extraordinary and eternal
does not want to be bent by us.
I mean the Angel who appeared
to the wrestlers of the Old Testament:
when the wrestlers' sinews
grew long like the metal strings,
he felt them under his fingers
like chords of deep music.

Whoever was beaten by this Angel
(who often simply declined the fight)
went away proud and strengthened
and great from that harsh hand,
that kneaded him as if to change his shape.
Winning does not tempt that man.
This is how he grows: by being defeated, decisively,
by constantly greater beings.

-Rainer Maria Rilke
translated by Robert Bly

Could hardly let this day go by without.............

paying homage to Henry David Thoreau, born this day in 1817. 

While previous posts have lots of things Thoreauvian, my two
favorite quotes have yet to appear.  Until now:

"If you have built castles in the air, your work need not be
lost; that  is where they should be.  Now put foundations
under them."

"If one advances confidently in the direction of his dream,
and endeavors to live the life which he has imagined, he
will meet with a success unexpected in common hours."

One of the great ones....................

I am often a fan of George Will....................

..........and sometimes I even understand him.  Kurt led me
to Will's recent column, ostensibly about prohibition, here.

Will's column recommends the reading of Daniel Okrent's
Last Call: The Rise and Fall of Prohibition, saying, "Okrent's
book is a timely tutorial on the law of unintended
consequences."  Faithful readers will remember that the
'law of unintended consequences' is my favorite law.  This
book is now in my shopping cart.

Will ends his essay with a fabulous closing paragraph,
"The many lessons of Okrent's story include: In the fight
between law and appetite, bet on appetite. And:
Americans then were, and let us hope still are, magnificently
ungovernable by elected nuisances."

Sunday, July 11, 2010

In Praise of a Community Bank.......................

subtitled:  Reasons Why I Like Living in Newark and Licking
County: Reason # 49:  Park National Bank.

There has been some local discussion lately about "community
banks".  This post will just add to the noise.  If you want a really,
really good picture of what the smart people mean when they are
discussing "community banks", go here.

When I think of a community bank, I think of Park National.

Here is my non-technical definition of  a community bank: A
financial institution that is embedded in the community it serves. 
Its ownership is generally local, its leadership is generally local,
its employees are generally local, and its customers are generally
local.  Decisions are made locally, the predominance of its lending
is done locally, and generally, if there is an issue, there is a real
person, somebody you know, or a neighbor of someone you
know, that you can go talk to and who will actually listen to you.

All well and good, a handy thing to have around if you are a
borrower, but not necessarily praiseworthy.

But, follow along with me for a moment....................

When Park National Bank was established in 1908, (history
here)  it was a teeny tiny bank.  Maybe the fifth largest in
Newark, Ohio.  The owners, however, hired some really special
people (Everett Reese and later John Alford come to mind) in its
early days.  These special people not only believed that the health
of their bank and the health of their community were inextricably
linked, but they imbued the culture of the bank with that
philosophy.  And therein lies the story. 

Flash forward.....................

The teeny tiny bank capitalized with $100,000 in 1908 has
grown to a multi-billion dollar organization.  While acquisitions
in recent years have added to the bank's size, over the long haul,
Park has been a profitable and growing company because of
the intelligence and diligence of its people, because of its steady
focus on its core banking services, because of its prudent business
style, and because it has helped its community to grow as well.
Its business accomplishments are worthy of respect.

One could quarrel with some of their lending decisions (I've
signed a few notes and mortgages I wish they had said "no" to),
or think that their Internet banking is frustrating to work with, or
just believe the bank is "too powerful".  But............the business
side is just the beginning of the story.

In its growth, Park National Bank has woven itself tightly
into the fabric of our community, and as a result, we are a
better, more vital community.

Try to imagine what downtown Newark would be like without
the four hundred or so PNB employees who work there. Try
to imagine the central Licking County community without the
five hundred plus PNB employees. The bank is a major
employer of talented Licking Countians.

Try to imagine what our community's non-profit and charitable
organizations would look like without the Park National Bank
volunteers. It is a difficult assignment to find local organizations
that have not benefited from the time, talent, generosity, and
leadership of Park employees.

Try to imagine Newark and Licking County today without the
Thomas J. Evans Foundation, the Reese Family Foundation,
the Lindorff Foundation, or the Alford Foundation.  The wealth
of these foundations, which so greatly enhance the quality of
life in our community, was originally derived from the
increasing value of Park National Bank stock. 

Try to imagine what our community would look like without the
dedication and continued re-investment of Park National Bank's
leadership in local treasures like the Newark Campus of The
Ohio State  University/Central Ohio Technical College (think
Lefevre Hall,the Reese Center, the Warner Library for starters)
and in the Licking Memorial Hospital.  Lest you think that
they are only interested in buildings, consider the immense
amount of money that has been pledged and given to support
scholarships for higher education.

Try to imagine our community without the results created by
the folks who spent considerable time in the bank's boardroom.
Charles Noble and the housing he created in east Newark;
Gib Reese and the bike path system, public art, and fireworks;
Jack O'Neill and the employment opportunities his industrial
developments created; Howard Lefevre with The Works and
all of his other impossible-to-list-them-all contributions.

Try to imagine our community if, in the 1980's, the ownership
of Park National Bank decided to simply take their money and
run, by selling the bank to a big city bank like Bank One.

If that had occurred, I suspect that our community would be
vastly different today- and not for the better. is a glass raised in toast to Park National Bank,
a community bank in the finest sense of the words.  Long may
they prosper and long may they stay an independent
community bank.

A verse for Sunday

25.  And in the fourth watch of the night He came to them,
walking on the sea.

26.  And when the disciples saw Him walking on the sea, they
were frightened, saying, 'It is a ghost!'  And they cried out in

27.  But immediately Jesus spoke to them, saying, 'Take
courage, it is I; do not be afraid.'

28.  And Peter answered Him and said, 'Lord if it is You,
command me to come to You on the water.'

29.  And He said, 'Come!' And Peter got out of the boat,
and walked on the water and came toward Jesus.

30.  But seeing the wind, he became afraid, and beginning
to sink, he cried out, saying 'Lord, save me!'

31.  And immediately Jesus stretched out His hand and
took hold of him, and said to him, 'O you of little faith,
why did you doubt?'

Mathew 14: 27-31 The Open Bible


I'm not sure whether I should laugh or cry............

"Empowering Homeowners Through Intelligent Strategic Default",
brought to your neighborhood by

It is never a good thing when language loses its meaning.  How
instructing and encouraging someone to default on a contract is
'empowering' eludes me.

For modest fees (starting at $199-$395), these nice folks will
help you be foreclosed upon, under the most favorable, and
least stressful, terms and conditions possible.

I suspect this is the natural evolution from, and a consequence
of, a time when loan originators and borrowers, together,
suspended all reason and logic.  It's that old reaping and
owing thing.   Doesn't mean I have to like it.

This blog is all in favor of supporting entrepreneurial people,
but in this case.... we will be making an exception.