Thursday, April 30, 2009

Social Norms, High School and Death Metal T-Shirts

Anyone who reads this blog knows it is no secret that I am a huge metal fan. I have been a metal head since I was in 5th grade and my love for the music has never wavered. When most people find out that I listen to metal they say something like, “I can’t believe you listen to metal” or “you don’t look like the typical person who likes that kind of music.” I understand that people like to group people with like interests into generalizations or categories. In a sense this is how our minds work. But back in the glory days, the high school days, I went through some interesting experiences brought upon me by my love of metal and I learned some valuable life lessons from those experiences.

I have always dressed kind of preppy I guess you would call it. It always just felt the most comfortable for me and my personality, and the fact that I played competitive hockey where dressing up for games was expected probably didn’t hurt either. Maybe it was for the girls, I don’t really know why we dress the way we do. However when I was in high school once every couple of weeks I would rock a death metal shirt to school. I wore an Obituary long sleeve shirt with evil body mutating trees on it. I wore a Cannibal Corpse shirt with rotting corpses performing lude acts on it. I wore many other band shirts that thankfully weren’t as bad as the Corpse shirt. Part of it was my love for the music, part of it was probably so satisfy some random teenage rebellion craving, and part of it was probably to wave my flag proudly that I didn’t think mainstream music at the time was any good.

What was interesting was what happened when I did this. Different girls or buddies would come up and ask what the shirt was all about. I would tell them it was a band I listened to and they would make some stupid joke or comment about it. I wasn’t too worried about it because all my real friends knew I was into it and even if they gave me a hard time about it they were just messing around. However, things got interesting when I would run into the kids that did fit the “typical person who likes that kind of music” mold. I would be walking by and I would get the classic poseur comment or something to that effect. What I found ironic was the fact there was some kid wearing a Marilyn Manson or Deftones shirt calling me a poseur while sporting a shirt from some of the most brutally heavy bands of all time.

What I find interesting when I look back is how even amongst various groups of people they are all trying to maintain the status quo. Everyone has situations in which they don’t feel like they fit in, especially during the teenage years. Instead of focusing on trying to always fit in, which I acknowledge is essential to human happiness, we should realize that there are times where it pays to stand out. When you don’t stand out you are average, and people aren’t rewarded internally or externally for being average. I am currently listening to an audio book by Seth Godin called Tribes. His book is all about becoming a leader and challenging the status quo. He argues that the new world needs and rewards “heretics” who go against the status quo, form tribes, and lead. It is a very good book that I will post a full review on shortly.

I think these experiences taught me to be more confident in myself, and to shrug it off when you are at the butt end of the joke. People are always trying to please other people especially at that age, but at the end of the day it is yourself that you must know and enjoy. A sense of self confidence is essential to living a life of learning and enjoyment. If you are always doubting and questioning what you are about and what you represent, how are you ever going to go about improving upon it?

I know this post is a random illustration of a simple concept, however like any great movie of the 80’s (see Lucas the 80's movie picture above!) what better way is there to analyze social norms and life lessons than reflecting on the stupid, unimportant scars you are left with from high school. If a whole decade of Hollywood producers can do it why can’t I?

Tuesday, April 28, 2009

From The Closet - Don't Treat Me Bad

From The Closet "Don't Treat Me Bad" by Firehouse - The other night I was at Drinkers in Philly which not only has some great beer specials ($2 PBR's that get discounted to $1.50 if shotgunned), but they play some of the greatest tunes ever consistently. The next day after some early morning hockey Heidi and I were headed into Philly again for a nice long run. What do these two events have in common? Well both events involve the band Firehouse. While we were at Drinkers "Don't Treat Me Bad" came on and I was pumped. It was the first time I had heard the song in a very long time, and like a fine wine it had aged to perfection. On our way downtown for our run I picked up a Monsters of Rock CD that we had picked up at the library and what song was smack dab in the middle? If you guessed a little number from former from the closet inductee Lita Ford you would be correct, but you would also be correct if you said "Don't Treat Me Bad." The metal gods of the 80's were trying to tell me something; and that something was that a from the closet post was well overdue and there is no better feature than Firehouse.

Check out the video below and you will be amazed at how gloriously 80's these guys are....except this video is from 1991! I know I couldn't believe it! The perms and the balls in a vice vocal stylings are straight 80's. What is more hilarious and surprising is that the band achieved a great deal of success and critical acclaim in an era killed by grunge. Check out the wikipedia history of the band here (notice they beat out Nirvana at the American Music Awards).

Regardless of the conception of the song, "Don't Treat Me Bad" oozes 80's and has to be one of the catchiest tunes ever. I watched a few live videos of these guys jamming the tune and they can really play for a hair band. No fancy audio production on CJ Snare's vocals, this guy rips it live. This clip has inspired me to remove "Livin' On A Prayer" as the karaoke jam of choice, I just have to memorize more than just the catchiest chorus ever. Instant classic straight from the closet.

Investing: A Dialogue Amongst Friends

Below I have included a cleaned up email exchange between some friends and I. It all starts with an article that argues against the buy and hold strategy and continues on to touch on a variety of topics. Some of the advice is tailored more towards those in the Air Force because these friends happen to be in the Air Force, however there are some great points for everyone. I have separated each email with a line. Hope you enjoy.;_ylt=A9G_b88TCfZJavgAihhsLKJ4
Bades, Reeser - I'd like to read your blogs concerning this article...don't let me down!
I might have to tackle that one in the BadskiBlog. A few quick thoughts: The guy makes some good points. I have read other books that reference the study in which the 10 best and worst days are removed. The point is noted but I don't really think it enforces his point that buy and hold doesn't work. I think it contradicts it. As long as you were in the game over the life of the study those outliers would not extremely affect you and would only serve to give you an overall gain of 8% or whatever it was. I also think that articles like this one are meant to get readership and stand out in a fairly boring topic. At the root of all the investing madness there lies an asset that you purchase that someone else is willing to buy. The value which they place on that asset is what fluctuates. One can argue in this article that just because something has occurred in the past is no guarantee that it will continue to occur in the future. Great. Point taken. But I think it is even crazier to assume that things have changed so much that people are not willing to buy assets in pursuit of a better return than the "hide your money under the bed" strategy. Regardless of all of these arguments, what other option do you have? Do you pull out completely? Do you become a day trader? Do you resort to a life of crime? I still believe in the buy and hold strategy because psychologically it forces me to put away and save money. Even though I have a net loss over the last 3-4 years I am better off than I would be spending my money and clothes, cars, food, and beer and anyone who says differently is likely profiting from that advice or lying to himself/herself.
Agreed. Buy and hold forever is still the way to go. If you are going to jump in and out of the market, do so with no more than 5% of your total portfolio.

Depending upon your tolerance for risk (mine is high), a good mix for young people like us with good jobs and a steady stream of income is 80% stocks, 10% bonds, 10% cash or cash equivalents. If you don't want to have $1M when you retire, go with 50% stocks, 30% bonds, 10% REITs, and 10% cash.

If you can, keep a good amount of cash in a savings account. You don't want to have to sell stocks or bonds to pay for something like a car repair, down payment, etc. Call the banks and negotiate your APY--you'd be surprised how easy it is. Shoot for 2-2.5%...rates are terrible right now.

How much cash should you keep? 10% of your overall combined gross income. My gross income is ~$47K X 2 for the wifey = $94K. I keep around $10K in a savings account. Don't keep a lot of cash in a checking account because you're probably getting about .20% interest.

If you haven't already set-up a Roth IRA with USAA call them today and begin the process--takes ~20 min. You can deposit up to $5,000.00 per year in your account. You will pay taxes up front, but it will grow tax free until you begin withdrawals at age 59.5.

In order of precedence:

1. Roth IRA
2. TSP (operates like a traditional IRA with higher limits)
3. Traditional IRA

Revisit this order if the military ever matches contributions in the TSP (it does for civilians)

What to buy in your Roth IRA:

1. USAA S&P 500 Index Fund, symbol: USSPX
2. USAA or Vanguard municipal or corporate bond funds

What not to buy:

1. Any mutual fund
2. Common stocks

Index funds have very low expense ratios. ~.15-.30%. Mutual funds run anywhere from 1.5-3.0%. Basically you are paying some jackass who knows no more than you do to lose your money.

Use the features at USAA and set-up a monthly deduction so you never even see the money. It will dollar cost average every month.

If you have a lot of cash and don't know what to do with it, try CDs (2.5-4.0% depending on the term) or municipal bonds (tax free both State and Federal).

Final thoughts (my opinion): The American dream is no longer about owning a home. Buy a home only if you've done (1) a ton of market research, (2) plan to live there a minimum of 5 years, 7-10 years is better, and (3) your credit score allows you to negotiate a great fixed rate mortgage--NEVER get an ARM. Don't look at renting as throwing your money's simply a sunk cost of living the dream as an American warrior.

Feel free to contact me if you have questions about what you should be doing.

Love Always,

Agree with everything you said with the exception of real estate but I think we both would agree that we are giving advice based on our own goals and dreams which may not be everyone else's. That is why I lean towards real estate and you don't, yet we agree on 99% of everything else. Good advice dude. Hope all is well boys.
Hey boys, I haven't been in the last couple days, but have enjoyed reading the emails so far. Not gonna lie, still haven't gone through the resumes yet, but did read some of Greeser's and Ski's financial advice. I definitely think that even though everyone has different goals one thing should remain very clear...Only 2 out of every 100 or 2% of American's over the age of 65 are able to retire WITHOUT any assistance from Government or other support from children/families etc. The question is...What are you going to do about it? I'm not banking on the Government to help me out when the time comes. If you read the fine print in your Air Force "contract" nowhere does it say that even if you retire that they have to continue paying your "retirement benefits." Therefore, X amount of years from now, even that retirement salary you may suck up 20 years for can go away. Just food for thought when considering your future financial situation.

Do either of you know much about Dave Ramsey? If so, what do you think? I bought his book and it's pretty good. He basically says to pay off all your debt right away and you'll have tons of money to invest after that. In theory, you can probably make more money without paying off your debt so quick, but in practice, it never really works that way...
My parents follow Dave Ramsey's advice and listen to his show. I know a little about what he preaches and what he is all about. In my mind I think he targets people who are struggling a little bit more than you and I but he has some good advice. The one thing I really like about Dave Ramsey is his snowball debt approach. He believes that you should tackle your smallest a $400 loan on a TV for instance and pay that off first regardless of the interest rate. Once that is paid and you free up lets say $40 a month that was going towards your TV you pay that towards your next lowest debt which lets say is a student loan of $5000. Once you pay that you take the $40 a month from the TV and the $100 a month from the student loan and roll that over towards your credit card debt of $10000 dollars. Many gurus attack the fact that you aren't paying off your highest interest rate first and therefore it is costing you more to pay off your debt that way. But I like how he acknowledges the psychological side of saving and investing which is so often overlooked. These people need success not optimization. The freed up cash rolled into the next debt will be more powerful for them than optimizing paying the least amount in interest. I think the premise behind Dave Ramsey is undeniable. If you have no debt and save you will be well off. However for someone like myself who has developed good financial habits and is committed to investing and learning, avoiding all debt isn't really the best strategy for me in some areas, specifically real estate investing. I also think it is unreasonable for most people to make major life purchases like a car, house, etc without taking on some debt. Concentrating on paying off that debt and perhaps ignoring investing while you are younger is going to have you miss out on some critical wealth building years and the power of compounding interest. Like I said I think his premises are sound from the limited amount I know, especially for people who aren't as disciplined with their money, just don't forget that investing while you are young is extremely important as well.
Agreed Badski. Some people need to tangible success in order to tackle their debt. However, from an investment perspective you should first pay off your debt with higher interest rates.
The more I learn about investing the more I learn to give the political answer of "it depends". Everything depends on who it is. There are some true time tested principles but if you cannot carry them out for whatever reason then whats the point. An example is that right now I have a huge surplus of cash in a money market fund. By all investment guidance and my age group I have way too much money in there. However, for my current situation and goals it is the right amount for me. I need some liquid cash for my next property, the market crash made me realize I did not have enough cash on hand for emergencies, and I to this date have never sold any of my investments. So I knew that I needed some more cash on hand for different life goals and preferences that others may not have. Little did I know that I have actually had a better return on that then my investments but that is besides the point. Now that I have built up that cash fund I am taking advantage of a market that as a whole is on sale! If you take responsibility for everything you do and keep investing and saving you are doing the right thing even if most people will tell you you can do better.

Monday, April 27, 2009

Which Is Your Favorite Gino?

Not only do I think Alexander Ovechkin is the best player in the NHL at the moment, I think he is also the most exciting. Some of the goals this guy scores make NHL players look like beer league ankle benders. Check out this link and watch/vote on your favorite Ovie goals. You can thank me later for delivering these delicious dangles directly to you.

Saturday, April 25, 2009

The Know It All Blogger Syndrome

The longer I maintain BadskiBlog the more torn I am. When it comes to blogging, there is a very difficult balance between sounding like a self indulgent know it all and continuing to write about the types of topics I am interested in covering and exploring with my readers.

Often I feel as though I am shelling out advice, which might cause people to say “who the hell is this guy?” The average person to stumble across my blog doesn’t know (or probably care) who I am. Our society loves experts and credentials. I don’t have ungodly credentials or expertise on the majority of things I am writing about. However, neither does the average reader I would assume. I don’t know a better way of learning and progressing than just jumping in so that has sort of been my philosophy and manifesto with this blog. As I said before it is slightly uncomfortable to put yourself out there in that fashion but I think the value added to my life has outweighed my discomfort. So let this little ditty serve as a disclaimer that I am not perfect. I do not think I am perfect. I do not flaunt a badge of awesomeness. Many of the posts I publish and explore are some of the same areas that I struggle with personally in my everyday life.

I am trying to think of more creative ways to make my blog more interactive than just a section for comments (which most people avoid). The guest post invitation is always open and valuable to the site, but I am looking for more. If you have any suggestions please let me know.

Friday, April 24, 2009

Cool Quotes

Here are some more Cool Quotes to get you through the weekend. Why try and say it any better than those who already said it best? Enjoy.

“Travel is fatal to prejudice, bigotry, and narrow-mindedness, and many of our people need it sorely on these accounts.” - Mark Twain

“I had just one more chance to be a boy, and I took it!” - Theodore Roosevelt, in answer to a friend who asked why he had literally risked his life on an expedition into an explored river in Brazil.

“Twenty years from now you will be more disappointed by the things you didn’t do than by the ones you did do. So throw off the bowlines, sail away from the safe harbor. Catch the trade winds in your sails. Explore. Dream. Discover.” - Attributed to Mark Twain

Joseph Heller famously responded when told by Kurt Vonnegut that a hedge fund manager had made more money in a single day than his classic novel Catch-22 made in its entire history, “Yes, but I have something he will never have… enough.”

"All that we send into the lives of others comes back into our own" - Markham was born on April 23, 1852 (American poet He is best-known for his poem of social protest, 1852-1940)

"One can only see what one observes, and one observes only things which are already in the mind." - Alphonse Bertillon was born on April 22, 1853

"Nothing so conclusively proves a man's ability to lead others as what he does from day to day to lead himself." - Thomas J. Watson

"Fear makes strangers of people who would be friends." - Shirley MacLaine was born on April 24, 1934 (Outspoken American actress and dancer, b.1934)

"The habit of reading is the only enjoyment in which there is no alloy; it lasts when all other pleasures fade." - Anthony Trollope was born on April 24, 1815

Goal Of The Playoffs By The NHL's Best Player

Before the game Alexander Ovechkin told Capital fans "don't give up hope yet." In an almost prophetic promise he delivered this beauty. This is the best goal of the playoffs by a player who I think is unarguably the best player to lace up a pair of skates this season. This guy does it all and I hope they make an amazing comeback from their 3-1, now 3-2, deficit in the series against the Rangers so we can be treated with more exciting stuff like this. Wow. What a gamer.

Leadership Opportunity Cost

The older I get the more I look for examples of leadership. In the majority of my posts on this blog there is a recurring theme of continuous learning no matter what the situation. Being a self proclaimed optimist I do my best to practice what I preach and learn even in difficult situations. I get emotional like anyone else but in the long run I tend to look back on difficult situations and realize that I learned as much if not more than I would had things gone smoothly. Check out my buddy’s guest post here for a more in depth explanation of this concept.

I was pumping a little iron in the good ol’ gym today listening to some thrash when I started to challenge this concept in a specific area. That area is leadership. Throughout my life I have been involved in sports, the military, business, etc. All of these fields provide a plethora of examples of leaders. Like anything else there are good leaders and bad leaders. I have always heeded the advice to learn from leaders both good and bad. From the good you learn what to emulate, from the bad you learn what not to do. Both are valuable, I do not doubt that. However, today when I was working out thinking about the ever present examples of poor leadership I started wondering if the two are equally valuable.

Am I, by being exposed more often than not to poor leadership, at a disadvantage in comparison to someone who is constantly surrounded by great leaders? Is there an opportunity cost to learning from piss poor leaders that outweighs the “what to avoid” knowledge and experience gained from being in their presence?

Rhetorical? Yes. Important to explore for yours and my personal development? Most definitely. Hockey is a small world. If the world we live in has people separated by six degrees of separation, then the hockey world is more in line with two degrees of separation. There aren’t too many names that come up that you haven’t played with or against or names that aren’t tied to someone that you have played with or against. In this small environment you get to notice trends amongst players, especially the ones above you on the hockey totem pole. I have noticed more often than not that the best players, the winners, grew up playing on winning teams. That is not to say that there aren’t diamonds in the rough because there are. I just think that the diamonds are more memorable and interesting than the winner who has been a winner on every team they have ever played on. What does this have to do with our discussion above? Well I think it has a lot to do with it. As I have said before, I believe sports parallel life. I don’t think it is a coincidence that a lot of winners stay winners.

Not only do I want to surround myself with great leaders because it provides a more enjoyable day to day experience. I want to surround myself with great examples so I can become a lifelong winner. Surround yourself with losers long enough and it is only a matter of time before you look in the mirror and are surprised by what you see. Life is really too short for that.
I am going to continue my lifelong commitment to learning from every scenario good and bad, but in environments where bad chi reigns I hope I am enlightened enough to know when to move on to a culture of success and righteousness.

Thursday, April 23, 2009

Guest Bloggage (And Bonus Cool Quotes) - John Satterberg

Guest Bloggage With John Satterberg - I am pleased to present to all you BadskiBlog enthusiasts an awesome guest post by one of my best friends John (Opie) Satterberg. Opus and I grew up playing hockey together and began our quest into the awesome world of metal together. He served (and will continue to serve on the reunion tour) as the bassist and stage presence facilitator for our currently hibernating melodic metal band Mask Of Sanity. He is a true lifelong learner and an avid reader. He left his father's company to take a job in construction for a lot less money, and within a few years started his own construction company Satterberg Construction. I reached out to him to shed some light on how he started his own business, and he surpassed all expectations by delivering this beauty. Enjoy and if you are interested in adding a Guest Bloggage post to the BadskiBlog collection contact me at

I’ve had trouble getting started on this installment of Badski’s guest blog for quite some time now and have decided to take a different approach to what may be ‘Conventional.’ When asked “How I started my business?” I could literally write a how-to manual that would read like stereo instructions and would be boring as hell; there are plenty of how to manuals out there for starting businesses and building houses. I could also share something based more on the ‘why?’ I started my business, which I feel is more important.

Most people have destinations that they want to arrive at during their lives, whether it’s an abundance of money, a meaningful relationship, a perfect family, a bunch of toys, etc., and people become so consumed with trying to reach their given destinations that they neglect the only opportunity they have to make any kind of a difference and that opportunity is only experienced in the now. In the past I have been stressed, anxious, fearful and hopeless in many different settings and if I had not experienced these feelings I would not have learned some of the valuable tools that I now have that bring me back into the present moment whenever my mind wants to be in the future.

The feelings listed above were all a result of my being in one situation and wanting to be in the future, thus resulting in anxiety caused by my mind, which is separate from being. The only real title I feel that anyone can give oneself is ‘human being.’ The attachments to titles such as “assistant to the assistant manager of the movie theater” are taken so seriously that I find them amusing. When speaking of being, I am referring to the oneness of all things, the energy flowing through all life forms in the universe, God if you will (George Lucas calls it ‘The Force’). The word that best describes this feeling of being is enlightenment.

I will not go so far as to say that I am ‘Enlightened,’ however in some of the hardest times of my life I have eventually come to experience the deepest feelings of peace, serenity, appreciation, wonder, and love, and in the feeling of these feelings I came to the realization that no matter what happens in this life, I will be OK. I was unaware until recently that the word for what I speak of is enlightenment, experiencing being to the fullest, which is nothing at all. It is everything stripped away to the very essence of who you are. Nothing in life is possible without love. Yes I believe in God, and I believe that God is not found outside oneself and that there is no one religion that has the right answer over another, I believe that God is everywhere and in everything and that God is here and now, presence, enlightenment, being.

This is ‘Why’ I started my business. I started my business because I learned that in life you are not a failure if you don’t make it, you are a success because you went for it and hopefully learned something along the way. The biggest struggles that we face are also the biggest opportunities for growth, and when we are experiencing the most pain around a given issue, we are simultaneously doing the most growing. I have a little black journal that I take with me everywhere. This journal is filled with quotes, ideas, fortunes, and other miscellaneous things that I find insightful. I’ll share some of my favorites. Thanks for reading, have fun and enjoy!

“The mouth of a wise man is in his heart.” –Benjamin Franklin

“The more I read, the more I meditate, and the more I acquire, the more certain I am that I know nothing.” –Voltaire

“Good people are good because they’ve come to wisdom through failure. We get very little wisdom from success you know.” -William Saroyan

“Man can learn nothing except by going from the known to the unknown.” –Claude Bernard

“He who knows others is learned; He who knows himself is wise.” –Lao Tzu

“Man’s mind stretched to a new idea never goes back to its original dimensions.” –Oliver Wendell Holmes Sr.

“The foolish person seeks happiness in the distance; the wise person grows it under his feet.” –James Oppenheim

“Courage means doing things in spite of fear.” –Dr. Laura Schlessinger

“If one remains on a journey of spiritual growth, one’s capacity to love grows and grows.” –M. Scott Peck

“He said that successful men rarely know the real reasons for their success, even though they always think they know. He added that this is caused by the fact that they’re too close to the forest to see the trees. That explanation had a big effect on me; if I couldn’t rely on the traditional advice of successful people, what could I rely on? It finally became apparent that the only solution was to develop my own philosophy and techniques, based on my own personal experience.” –Robert J. Ringer

“Through considerable wasted time, effort, and money, I found that most people, who claim to be real estate buyers (or buyers of any big ‘product’ for that matter) seldom, if ever, actually close a sale.” –Robert J. Ringer

“The more limited the parameters of consciousness, the more constrained the experience of life. Without consciousness there is no way to experience who we are.” –Shirley MacLaine

“If your goal is to become financially secure, you’ll likely attain it…but if your motive is to make money to spend money on the good life…you’re never gonna make it.” –Mr. Martin

“A good plan today is better than a perfect plan tomorrow.” –General Patton

“Work as if you didn’t need the money. Aim for the point where you don’t do anything unless your heart is in it.” –Richard Templar

“Never mention how much you’ve got, what you’re worth, or how much you earn.” –Richard Templar

“Great moments are born from great opportunities.” –Herb Brooks

“The person who wants the deal the most gets the worst deal.” –Jo-Ellan Dimitrius

“If one throws salt at thee thou wilt receive no harm unless thou hast sore places.” –Latin Proverb

“All men’s miseries derive from not being able to sit quiet in a room alone.” –Blaine Pascal

What Do You Want?

I read this post by Ben Casnocha yesterday and found it interesting. He is reviewing a book, which I haven't read, and eventually gets to talking about being consumed with start-up or business success. Read the full post here. Ben argues that this is one of the drawbacks with the start-up life and admits that he doesn't know whether or not it is necessary to success in that area.

Most ambitious companies -- certainly start-ups -- require of their employees single-mindedness. They demand all-consuming focus, and to "give thought to the critical personal and political issues that affect one's emotional present" is seen a distraction. Some of the successful business executives I've met are absolutely immersed in their professional micro-universe. The politics of the world, their personal relationships, their personal philosophies: who cares? Whether they realize they're wearing blinders, I don't know. Whether blinders are necessary to achieve massive professional success, I also don't know.

I would take it a step further and say that this is a drawback to the pursuit of anything in life. When you want something and pursue it you risk becoming consumed by it. I did this with hockey for the majority of my life. I don't regret my personal pursuit of excellence in hockey, and I attribute much of my success to that desire and passion.

People struggle with being consumed by something they love and desire when they aren't honest with themselves about what they truly want out of life and/or by having a narrowed scope of a small portion of their overall life journey. You must know what you want out of life, and just because you want the one thing that is consuming you doesn't mean that there aren't other things in you life you wish to pursue and enjoy as well. So you want business success. What happens when you achieve it? What is the end state? One of my personal mantra's is "always content, never satisfied." This is my personal reminder to always enjoy where you are at and what you are doing, but to always be wanting and driving for more. To always want a better life for myself. I remind myself of this to put into perspective the things I enjoy in life as well; family, friends, experiences, learning, achievement, etc. You can see how focusing on meeting that sales quota for example can drown out those other things. Be honest with yourself and keep the totality of how you want your life to play out in mind.

Tuesday, April 21, 2009

Trip Summary: Washington DC

This past weekend Heidi and I went to Washington DC to meet up with her parents who were visiting. The trip was a good time and DC was a lot better than I remembered it being. Here is a summary of our trip.

Day 1:
We drove down and caught DC traffic at its worst. It probably took us over an hour to navigate our way through the city and to our hotel in the Georgetown area. The hotel was right near George Washington University, which is a pretty cool campus that is tucked in between Georgetown and the Lincoln memorial in the mall. It is a city campus that feels a little more like a traditional campus just due to the nice little neighborhood that it resides in. From what I saw it seems like it would be a pretty enjoyable place to live. We stayed at the River Inn which turned out to be an awesome place. It was definitely an old apartment building that was turned into a hotel but that was what was great about it. It was just off a main road tucked away in a nice little neighborhood. It was close enough to everything we wanted to see as well. While having a beer in the hotel lobby we got a restaurant recommendation from the very odd bartender. He recommended Harry's Tap Room which sounded good. Harry's is the oldest bar in the city apparently and it resides within the Hotel Harrington. The only problem was that Harry's wasn't a tap room at all. It turned out to be more like a Friday's but it was the first night and we were crashing early anyway.

Day 2:
The second day was mostly filled with monuments and museums. We actually did the double decker tour bus thing which turned out to be good since the tickets were valid for two days and you can get on and off at any stop and catch the next bus. The weekend was filled with beautiful weather so that also made it enjoyable. The highlight of the museum and monument circuit was the Holocaust museum. I have been there every time that I have been to DC and the place always delivers. Although a somber topic, the museum does an awesome job of presenting history in a well thought out organized way that does justice to the victims of the holocaust. I had the privilege of visiting Dachau while our college hockey team was on a trip in Germany and it was an amazing experience. The holocaust museum in DC is probably the closest thing you can get to visiting the real camps outside of Europe. Very impressive museum that everyone should check out at some point in their life. That night we went to Oyamel that described itself on the Internet as authentic Mexican food. When we got there I realized pretty quickly that it was far from an authentic Mexican food place. The place was a trendier tapas restaurant. I love the idea of tapas in theory. A bunch of little appetizer like foods that can be assembled a la carte to piece together a great meal. However, in practice I find that most American tapas places reside within big cities and tend to cater to the higher end consumer. What you get is, in this case, one taco the size an Ipod nano for ten bucks. I can't argue that the food was good. It was more gourmet than authentic, but good nonetheless. Me being the person that I am I just feel a little cheated when I go to tapas bars. Probably more of a personal problem, because the atmosphere was great, the margaritas were delicious, and it was a fun end to the night.

Day 3:
We went to a few more museums in the morning. The Air and Space museum was pretty interesting. We also went to Arlington National Cemetery. I had never been and I must say it was pretty impressive. The cemetery is a great tribute to those who died serving our country. We saw JFK's eternal flame and enjoyed the beautiful day at the cemetery. After that we continued on our double decker tour bus ride through some more of the city. Another thing I thought was really cool was the Embassy area of town. All these different countries represented side by side in old mansions in DC. It put into perspective for me how globally interdependent the world has become. After that I got sucked into shopping in Georgetown. I am one of those guys who can hang for a while shopping but I get restless and annoyed with crowds, which in Georgetown were running ramped that day due to the weather. Georgetown is beautiful. Lots of little shops and restaurants that still retain that old city charm while having all the excitement of a new and bustling neighborhood. It is also a retailers paradise I would assume. A steady base of affluent individuals and rich college kids supplemented with tourists galore. That night we met up with the son of a family friend who recommended we go get Ethiopian food. Seeing as it was my first Ethiopian food experience I was excited. There is a large Ethiopian population in DC and thus the food has become somewhat of a staple in the DC area. We went to Meskerem in the Adams Morgan section of DC which is a very cool area of town. The area has a very diverse collection of bars and restaurants. I loved the Ethiopian food. The Ethiopian culture places a lot of social emphasis on eating which is definitely reflected in the way the food is served and eaten. The food was served in a large curved bowl about the size of couch cushion. Flat bread with a sponge like consistency came out rolled up like a hot towel in first class on a plane. Everyone at the table tears off some of their bread and uses it and their fingers to pick up some of the main courses. Breaking bread is important and sharing food with friends (and with your hands) is supposed to signify loyalty and friendship of the diners. Fingers, friends, food; it was my kind of place.
Diners share large platters of food, which they scoop up with a sourdough crepe like pancake called injera (no silverware here). You'll notice a lot of watt dishes, which refers to the traditional Ethiopian stew, made with your choice of beef, chicken, lamb, or vegetables, in varying degrees of hot and spicy; the alicha watts are milder and more delicately flavored. You might share an entree -- perhaps yegeb kay watt (succulent lamb in thick, hot berbere sauce) -- along with a platter of five vegetarian dishes served with tomato and potato salads. Some combination platters comprise an array of beef, chicken, lamb, and vegetables. There's a full bar; the wine list includes Ethiopian wine and beer.

The food was definitely interesting and definitely delicious. I can't say that everyone at the table enjoyed the food and beer as much as I did, but it was a good experience nonetheless. After we finished up dinner we went to the Brickskeller bar. This place was ridiculous! Check out this beer list! Definitely a mainstay attraction in the hearts of any true beer lover. The atmosphere was great as well, with the bar being primarily a brick basement complete with varied tables sizes for all groups of friends. After a beer or two we hit up the Jefferson monument at night which was a pretty cool way to end the night.

Day 3:
We got up early and walked our dog Otis before doing a final monument tour of the Vietnam/Korean war memorials and the Lincoln monument. It was a final tourist cram session before our departure.

The trip was very memorable but there were a few things that stood out in my mind.

First off was the layout and overall feel of the city. Heidi and I are training for the Broad St run in Philadelphia this month so we did an 8 mile run through DC. I love how much of the city is a park or a park like feel. A law forbidding any building to be 75 feet taller than the street it resides on keeps all of the buildings short in stature and amplifies the Washington monument as the center of the city. The mall area makes the city, although ridiculously jammed packed with regard to traffic, feel clean, green and very pedestrian friendly.

This quote really stood out to me while visiting the Holocaust museum.
"Where books are burned, in the end people will be burned." Heinrich Heine

Another thing that I noticed was the education level of the cab drivers. I am not trying to generalize a profession of people but these guys put the NY cabbies to shame. While Heidi's dad chatted with a cabby it came out that all the DC cab drivers are free to own and operate their own cabs. They are obviously still regulated but it is much more a free market system than that of New York. In my mind this did two things. First off it changed the way they operate. In NY cabbies are flying around a thousand miles an hour trying to pick up as many people as possible to make some tips and make a living while still paying the man. In DC the cab drivers drove like normal human beings. The second thing I noticed that may or may not be related was how knowledgeable these guys were. One cab driver from Ethiopia knew more about Washington DC and American history off the top of his head than probably anyone I know. Another driver discussed Afghanistan with us. Another driver went into the political lenses that different nations view world events through. It was pretty impressive. Here are cab drivers, who many would assume are low educated drivers, putting us to shame on knowledge of what is going on in this world. There were times we stayed in the cab and used the driver as our own private tour guide. I imagine this happens a lot, and therefore it pays to be knowledgeable. DC likely attracts "cab talent" or at least retains it for this reason. The experience just solidified my belief that graduating from a good college or university is not the end all be all of being smart or being intelligent. Intelligent living is a result of a commitment to learning, unique experiences, and the acceptance and/or humility to know that there is so much out there you do not know. The experience also reaffirmed to me the importance of treating all people with the same dignity and respect. Everyone you meet has a unique life that has shaped the way they think and what they have to offer. You can learn from everyone, and more importantly it is the right thing to do.

Monday, April 20, 2009

Get Rid of Service Academies?

My uncle sent me this article asking what I thought about it. Basically the author is recommending to get rid of the service academies. He argues that the education is inferior and the cost greater. He also says that some commanders prefer non academy graduates.

Want to trim the federal budget and improve the military at the same time? Shut down West Point, Annapolis and the Air Force Academy, and use some of the savings to expand ROTC scholarships. After covering the U.S. military for nearly two decades, I've concluded that graduates of the service academies don't stand out compared to other officers. Yet producing them is more than twice as expensive as taking in graduates of civilian schools ($300,000 per West Point product vs. $130,000 for ROTC student). On top of the economic advantage, I've been told by some commanders that they prefer officers who come out of ROTC programs, because they tend to be better educated and less cynical about the military.

A few things struck me about this guys argument and I must say that I actually find his point of view pretty interesting. To avoid sounding completely defensive and self indulgent I have to acknowledge that the guy has some points. Where I think he misses the boat is that a service academy is not all about the education. I think that anyone who knows anything about service academies know that it is not the education, it is the character building. Anyone can get an education at one of our nation's universities. If you cannot get into one chances are there is one where you can get in. ROTC is much more selective than the admissions department of our nations universities, but the author did not compare the ROTC program and the service academy program. He is placing all his emphasis on the traditional education. I would venture to say that not everyone can make it through a service academy. The attrition rate from freshman to senior year is a testament to that. This is not to say that I think that academy graduates are better than ROTC because I don't. In fact I rarely notice the difference or care. However, in a country that values diversity amongst it's citizens why would we shun it in the commissioning of our officer corps? It is my belief that officers from ROTC, service academies, and OTS serve as a great representation of our nation's youth and all provide value in service to our country.

I think his article also shows how obsessed our country is with credentials. Just because the professors don't have doctorates the author is assuming the education is less than that of ROTC schools. I think its a pretty ridiculous to make that argument especially since all three academies consistently rank amongst the best undergrad programs this country has to offer. According to the author's reasoning we are safe to assume that school rankings should be decided by number of doctorate teachers. I think the author fails to acknowledge that much of the value we as society place on degrees stems from the value employers place on degrees. Service academies are generally viewed in a positive light by corporate America and I doubt many companies are looking at the number of doctorates teaching at an applicant's institution. I don't think this guy would place too much credibility on my Personal MBA quest?

With all that being said I really think that it doesn't matter where you come from, it comes down to "what have you done for me lately." Good people, good officers, good whatever always rise to the top no matter where they came from. I have seen this in hockey a million times. A kid comes out of no where and makes it to the big show. Although I do agree with the author that once in the service, people normally cannot tell whether you came from OTS, ROTC, or an academy. I believe that each commissioning source provides a unique perspective and skill set that is valuable to our country. Discounting that based on purely economic savings is reckless to say the least. Remember these academies aren't just breeding military leaders, they are breeding our nations leaders. Would you want all your political leaders to come from the same senate seat? Would you pick an NHL team with players from one junior league? I wouldn't.

Sunday, April 19, 2009

Personal MBA Update

I just finished reading "I Will Teach You To Be Rich" by Ramit Sethi this weekend and it was a pretty impressive book. Ramit Sethi maintains the blog; one of the blogs that I enjoy and follow. The book is targeted towards 20 to 30 somethings early in their financial journey, however I would say that it is a solid read for anyone that doesn't know where to start on their financial journey.

For me this book didn't offer any mind blowing technical knowledge. Any college graduate majoring in business possesses the basic knowledge imparted by this book. But I think that is what Ramit intended! Personal finance isn't book smart hard, it is discipline and will power hard. Where Ramit's book sets itself apart is the well thought out general theorem and the overall practicality of the advice. Anyone who doesn't know anything about personal finance could pick up this book and, with some self discipline, be on their way to reaching their financial goals.

I must say that part of the reason I liked the book is that I agree with about 99% of what Ramit preaches. Ramit just does a hell of a lot better job at tying in all his beliefs and concepts into one book. The only area that I disagree with the book about is regarding real estate. And it is not so much disagreement, since the more I read his passage on real estate the more I think I know the message he is trying to portray. He is trying to say that your house is not an investment and buying a home may not be the best choice for everyone. I would say that your house is not an investment while you are living in it, however when you are buying it you should treat it as such. I am a big proponent of the value of real estate and am excited to get my next property, and I think that although the book's advice is solid and warranted it may scare off some younger people who should be looking to buy a home or purchase an investment property. The section is pretty short so maybe I am just overreacting.

The book does an awesome job of formulating a system that works, both numerically and more importantly psychologically. This is where young people will really relate. He is not saying to cut out all the fun in your life. He recommends a system to save a certain amount, and reaffirms that it is OK, nay almost encourages, you to blow the rest on things that you enjoy. Whether that is food, vacations, or shoes is irrelevant. I couldn't agree more and I currently practice a very similar system. You can read more on my mentality on my money tips post here.

Overall, the book kicks ass. The read is easy, there are some funny off color remarks, and the theory parallels my own which I think (although biased) is pretty solid. I will likely recommend it to my buddies and acquaintances that are looking for a place to start. It is also a great book to have on the shelf to make sure you are sticking with those good habits. Check the book out. Here are my notes from the book.

- Why money and food are similar: We don't track calorie intake. We don't track spending. Eat more than we know. Spend more than we realize-or admit. Debate minutiae about calories, diets, and workouts. Debate minutiae about interest rates and hot stocks. Value anecdotal advice over research. Listen to friends, our parents, and TV talking heads instead of reading a few good personal finance books.
- You don't have to be an expert to get rich. You do have to know how to cut through all the info and actually start.
- Info glut; too much info leads to decision paralysis
- ....As the number of mutual funds in a 401(k) plan offered to employees goes up, the likelihood that they will choose a fund-any fund-goes down. For every 10 funds added to the array of options, the rate of participation drops 2 percent. And for those who do invest, added fund options increase the chances that employees will invest in ultraconservative money market funds. I made a note that I do the same thing at NJ diners. There are 200 number choices and I can't even begin looking because I am too overwhelmed.
- The single most important thing a person can do to be rich is to start early. See Time Value of Money Chart on page 5
- "Why does just about everything written about personal finance make me want to paint myself with honey and jump into a nest of fire ants? Personal finance advice has been geared toward old white men and taught by old white men for far too long. I don't understand why newspaper columnists continue to write about tax-optimization strategies and spending less on lattes, hoping that young people will listen. We don't care about that. We care about knowing where our money's going and redirecting it to go where we want it to go. We want our money to grown automatically, in accounts that don't nickel and dime us with fees. An we don't want to have to become financial experts to become rich.
- A lot of financial problems are caused by one person - you!
- For all those that blame gov't, CEOs, evil banks, etc. have any of them ever read even 1 personal finance book?
- More important to start than to spend exhaustive amounts of time researching the best fund in the universe
- Instead of "how much money do I need to make?" say "what do I want to do w/my life and how can I use money to do it?"
- Why do you want to be rich? What does being rich mean to you?
- Our biggest purchases are made on credit. Good credit is the first step in building a good financial infrastructure.
- One key difference between rich people and everyone else is that rich people plan before they need to plan.
- Table on page 17 showing how credit affects what you pay.
- While other people spend many hours cutting coupons, growing food in their gardens to save on grocery bills, or being frugal with lattes, they're failing to see the bigger picture. It's fine to be frugal, but you should focus on spending time on the things that matter, the big wins.
- If you pay your entire bill on time, its actually a free short term loan (credit cards) easy to track spending free warranty extensions and rental car insurance
- Avoid card offers in the mail.
- Avoid cash back offers because they don't pay, travel is better
- Friends brag about saving $10 on clothes while you silently save thousands by improving your credit score
- Pay on time, its the most important thing you can do. 35% of your score depends on it.
- Automate payments. You can get email and you can adjust the amount to pay in full.
- Eliminate fees - negotiate a lower APR - keep cards a long time and keep them active.
- Get more credit if you have no debt for a better credit utilization rate - 30% of score
- Use your rewards
- Avoid closing your accounts. You have less available credit and the same amount of debt.
- Pay down student loans
- Albert Einstein "Compounding is mankind's greatest invention because it allows for the reliable systematic accumulation of wealth."
- Ask your friends how much they have invested
- Millionaires invest 20% of household income each year. Wealth is measured by how much they have saved and invested over time.
- The Ladder of Personal Finance: 1. Contribute just enough to get 401(k) match. 2. Pay off cards and any other debt 3. Open Roth IRA and max it out 4. Go back to 401(k) and go above the match level up to the limit 5. Invest a non retirement account, pay extra on mortgage, invest in yourself
- Its not budgeting, its a conscious spending plan - Spend and invest enough and spend the rest guilt free
- Fixed costs 50%-60% Investments 10% Savings 5%-10% Guilt free spending 25%-30%
- websites on pg 109
- Americans love experts but being an expert is supposed to be all about results
- In 2001 Frederic Brochet ran a wine study. 57 experts evaluated on red and one white wine. After tasting the two they described red as intense, deep and spicy which are common to red wine. They described the white as lively fresh and floral which are also common. Not one expert picked up the fact that they were the same wine. The red was just some of the white wine with food coloring.
- You can beat the so called experts on your own but it takes guts because you have no one else to blame but yourself
- In an S&P study from 1983-2003 the market had an annualized return of 10.01%. During that period if you missed the best 20 days your return would be 5.03%. If you missed the best 40 days your returns would equal 1.6%. The only solution is to invest regularly putting as much as possible into low cost diversified funds.
- Yale's David Swenson said "Ive got 20 professionals here in New Haven devoting their careers to identifying high quality active management opportunities. An individual who devotes a couple of hours a week in the evening, at most, trying to compete with institutions that have armies of people out there? It just doesn't make sense."
- Survivorship bias does not include funds that fail. Only survivors.
- The perfect stock picking record. Email 10,000 people half about stock A and half stock B. If A goes up eliminate stock B group and email stock A group about C and D. Do the same again. And again. You now have 1250 people who see that you can pick two stock successfully. Each cycle is awed by the ability of the advisor. Don't trust the experts.
- Blogs on page 152
- Ask an actively managed fund or broker only one question, "What were your after tax after fee returns for the last 15 to 20 years?" They will not give you a straight answer because they will be admitting that they didn't beat the market.
- Warren Buffett "Be fearful when others are greedy, and greedy when others are fearful."
- 90% of your portfolios volatility is a result of asset allocation
- William Bernstein "Since you cannot successfully time the market or select individual stocks, asset allocation should be the major focus of your investment strategy, because it is the only factor affecting your investment risk and return that you can control."
- Your investment plan is more important than your actual investments
- "I believe that 98 or 99% - maybe more than 99% - of people who invest should extensively diversify and not trade. That leads them to an index fund with very low costs." Warren Buffett
- "When you realize how few advisers have beaten the market over the last several decades, you may acquire the discipline to do something even better: become a long term index investor," Mark Hulbert
- "The media focuses on the temporarily winning active funds that score the more spectacular bulls eyes, not index funds that score every year and accumulate less flashy, but ultimately, winning scores." W. Scott Simon
- Links on page 197
- is craigslist for startups

Wednesday, April 15, 2009

How Much Do You Need To Retire?

In all the personal finance articles and books I read, the question "how much do you need to retire" always comes up. The answer is never simple and I tend to err on slightly outrageous overestimation side, but I came across an article the other day on MyMoneyBlog that has some very simple and good advice. I have been busy the last few days and haven't had a chance to run the numbers as accurately as I would like, but hopefully by immortalizing the concept within the vortex that is BadskiBlog I will be more apt to run the numbers correctly.

Here is the full post on a quick down and dirty plan to reach financial freedom. This plan is obviously overly simplified as it only contains two parts: accumulate 30 times annual expenses and pay off your mortgage. But the concepts are good and it's somewhere to start, especially for those with little financial knowledge.

I really like the numerical illustration of the damage done by lifestyle inflation. I think the psychology of investing and accumulating wealth is so often overlooked but it is some of the best advice a person can heed. No matter how much technical expertise you gain about investing and money, it is all for naught if you just increase you standard of living at a pace greater than or equal to your increased income? See my why athletes go broke post here if you don't believe me!

I would add to this article a few key tips that acknowledge the importance of psychology within investing. First and foremost keep more than you spend. Even it it's only 1%, just get started. Learn to live comfortably at that level and start ratcheting up your saving/investing percentage either through increased income or decreased spending/costs or some combination of both. I would also argue that you need to continue investing in your personal finance education. As your wealth increases your knowledge and ability to manage that wealth should be increasing as well. Maintain a lifelong commitment to learning.

All in all this is a great quick start article for those who feel lost about how much they need for retirement.

Tuesday, April 14, 2009

Disturbing Story Disturbing Trend

The ten year anniversary of the killings at Columbine High School have brought the horrible tragedy back to the forefront of the mainstream media. However, ten years later the story reads much differently. I found this article on USAToday and found it almost as interesting as it was disturbing.

The article does an excellent job of revealing how much of what was reported was down right wrong. While I read through the article I couldn't believe how different the reports that are being revealed now are from my memory of the media coverage ten years ago. In my mind I envision two "goth" kids wearing long trench coats out to destroy the "beautiful people." It was two kids who listened to the wrong music (metal), watched too much gory TV, got bullied too much, and were basically social outcasts. According to many of the books and reports out now not much of the media's portrayal was very accurate.

I am glad that this retraction of sorts is actually getting some press, no matter how limited. I am glad because I think it illustrates a disturbing trend in our society. The trend I am talking about is the trend to find blame. I see more and more that we as a nation are seeking to place blame and find fault in every event that unfolds. Take Columbine. People want to blame the parents, blame video games, blame bullying. The list is endless. Is it too much to fathom that there are just some bad eggs out there? Any statisticians out there that can back me up? I am a firm believer that people are inherently good. However, I also believe that some people are just not good people. I am not out to solve the nature versus nurture argument here I am just saying that I never understood the need to blame everyone but the person who committed the crime?!

"These are not ordinary kids who were bullied into retaliation," psychologist Peter Langman writes in his new book, Why Kids Kill: Inside the Minds of School Shooters. "These are not ordinary kids who played too many video games. These are not ordinary kids who just wanted to be famous. These are simply not ordinary kids. These are kids with serious psychological problems."

This trend doesn't just apply to acts like Columbine. It happens in everything from getting burned by a cup of coffee to natural disasters. Stuff happens, and I think that some of these events would have happened regardless of the precaution and/or changes in circumstance. Accidents happen, natural disasters happen, crazies are out there. Our quest to find a direct line of reasoning for the cause, which in most cases leads to blame, can not always be fulfilled. I don't know the what the perpetually increasing blaming trend stems from, but I think it may have something to do with the litigation nation phenomenon. We have more lawyers in the US than the rest of the world combined and it is their job to find blame, so maybe that is part of the cause. All I know for sure is that there is not enough responsibility placed on the perpetrator in scenarios like this and other tragic events. I think we can learn from the lessons illustrated in this tragedy, but beyond that realize that the world is a chaotic place and you cannot place the blame for any event that unfolds within it.

Cool Quotes

More quotes to add to the cool quotes library!

"As human beings, we are endowed with freedom of choice, and we cannot shuffle off our responsibility upon the shoulders of God or nature. We must shoulder it ourselves. It is our responsibility." - Arnold Toynbee

"Don't have sex man. It leads to kissing and pretty soon you have to start talking to them." - Steve Martin

"You miss 100% of the shots you don't take." - Wayne Gretzky

"Diligence is the mother of good luck." - Ben Franklin

"Nothing great was ever achieved without enthusiasm." - Ralph Waldo Emerson

Your Daily Dose Of Metal

With the metal scene moving towards a melodic death metal tilt it is easy to forget some of the metalists that started the whole movement. Sweden's In Flames has been kicking ass for years and after a couple sub par albums by their standards they have put out a release that is arguably one of their best. "A Sense of Purpose" takes their old aggression and melodic guitar driven songs and mixed it with their more mature singing style and song structure. Check out March to the Shore below and enjoy your daily dose of metal!

Monday, April 13, 2009

Cool Concept And An Important Lesson

Tired of waiting for a half hour, inching your way through a crowded bar to pay $7 for a beer? Well those days are over if you pick the right establishment. Minibar has created a self service bar! All you need is a passport, license or credit card and you are given a key to your own minibar within the actual bar. The drinks are counted when you retrieve your card and you pay before you leave. What a great concept. I might have to "borrow" this idea and replicate it.

Not only is this a cool business idea, it is a valuable reminder that within every problem lies an opportunity. Even when that problem seems impossible to solve, like the waiting for a beer in a pub problem, a twist on the old way of thinking can instantly become a competitive advantage. I love entrepreneurship and my dream is to be an entrepreneur. I think its stories like this that make me love it. Entrepreneurs come up with the ideas that make you say "why didn't I think of that?" It seems so simple and in your face that you're amazed that no one has done it before. I really want to make a conscious effort to start recognizing even the simplest discomforts and begin brainstorming ways to exploit them for profit. Easier said than done but surely a great habit to get into.

Sunday, April 12, 2009

Happy Easter! Another Feel Good Article

Happy Easter everyone. A great man named Dickie Dunn once said, "I was just trying to capture the spirit of the thing Reg." That quote is a throwback to the great movie Slap Shot and a tribute to the late great Paul Newman. I, like Dickie, am also trying to capture the spirit of the thing. And that thing happens to be Easter. So I am following up with another feel good article that I came across the other day. Do yourself a favor and read the full article here.

Retired Navy Captain Ed Nicholson has put together something that I find pretty incredible, and something that I can relate too on a couple different levels. He has put together a foundation that seeks to rehabilitate wounded soldiers through fly fishing. The Project Healing Waters website can be found here.

"The demons of war, you just don't set them aside," says Nicholson, 67. "But once you get out on the river, the serenity is incredibly healing."

While recovering from cancer surgery at Walter Reed Army Medical Center in 2004, Nicholson witnessed wounded and disabled men and women -- many of them amputees -- struggling with their injuries.

"Other than being in Vietnam and seeing people in the process of getting hurt, I never really had a full appreciation for the recovery part and what happened after they came home. My recovery was nothing compared to what they were facing. It planted the seed that maybe there's something I could do," Nicholson says.

Now I am not even going to pretend I can relate to what these wounded soldiers are going through. However, I feel as though being in the military gives me the ability to relate to their situation a little more. Maybe it just makes my empathy a little more real. I also relate to this story because I used to call myself a fly fisherman. I grew up camping with my Mom, Dad, and Brother in Oregon and we would always go fly fishing. I have some amazing memories from those days and I look forward to continuing them after my own service. I continued fly fishing in college in Colorado, but when I moved to New Jersey I stopped. So while I cannot truly call myself a fly fisherman today, I am a fly fisherman at heart that fully appreciates the serene and soothing effects of fly fishing and just being amongst the glory of nature.

I am always amazed by people like Ed and their ability to just pick up and do something astonishing for other people. I can only hope that one day people will describe me in the same light.

Saturday, April 11, 2009

Re-purpose Before You Re-structure

I signed up on a few months ago to get mailing letters. This one comes from the man himself Jim Womack. Jim Womack actually coined the term lean in his book "The Machine That Changed The World" and is probably the leading author and expert on lean and continuous process improvement. His letter is pretty interesting and I think it illustrates a very insightful point. When times were booming everyone's mission statement became making money. But the customer does not pay you to make money. The customer pays you because they value the product or service your company provides. This message is very simple and seems intuitive, but obviously keeping it on the forefront of company priorities is something that many struggle with. My favorite quote is below.

The natural instinct of senior managers in any crisis is to restructure and downsize. But the question is always, "Restructure and downsize toward what?" No customer cares about a company's structure. No customer cares about downsizing. Customers only care about a company solving their problems along life's path.

My lean mentor and friend always talks about the difference between real lean and fake lean. He says the difference between real lean and fake lean is a respect for people. Sometimes the numbers work out in a manner that you have improved your process and need less manpower to accomplish the same task. Fake lean would fire those people based on health care costs, salary cost, etc. Real lean would free those people up as change agents working on continuous process improvement and lean in other areas of the organization. Downsizing without a purpose does nothing.

I also think his message bypasses all the ideological battles (that I get sucked into quite often) about the bailouts and government stimulus packages. We as a nation get so caught up in acting that we haven't defined what the purpose of our action is. If we continue to throw money and provide aid to GM, what is the end state? What are we helping them strive towards? Can anyone answer this question? Or more importantly has anyone asked? This lesson can be applied to your own life and personal finance journey as well. What is your purpose for saving, for getting out of debt, for wanting to become a millionaire? What is your mission statement? Enjoy Jim Womack, the godfather of lean, and the powerful message he delivers below.

One of my favorite questions when meeting with senior leaders of enterprises is, "What is your organization's purpose?" The typical and immediate response is, "To make money and grow." "But," I respond, "this answer has nothing to do with your customers, who provide the money your organization needs to profit and grow." I then repeat my question, but elaborate, 'What does your organization do to solve customer problems better than competitors so that customers old and new will pay good money for your services and goods and buy more over time?'"

In recent years a fashionable alternative to "make money and grow sales" was that organizational purpose was to steadily grow shareholder value. But now the king of shareholder value, General Electric's retired chairman Jack Welch, has acknowledged – thank goodness – that this is a result, not a strategy for achieving this result. Now that investors as well as customers are on strike during the great financial crisis, the whole management world is being forced to rethink purpose from the standpoint of the customer.

Confusion about purpose is particularly painful to watch in the collapse of General Motors because this organization was so brilliant for so long in clearly defining its purpose. On June 9, 1921, GM's great leader Alfred Sloan produced a simple memorandum on the topic of "Product Policy" that defined General Motors’ purpose for generations to come.

Sloan stated that General Motors would provide a carefully configured range of products for "every purse and purpose", from used Chevrolets at the lower end of the market (with dealer financing on these traded-in vehicles) to a "fully loaded" Cadillac at the top end. This simple memo rationalized GM's chaotic product line-up so its vehicles would not overlap in the market. Instead, they would each have a clearly defined place in a status hierarchy and would always be more refined, a bit "classier" with a higher price, than competitor products in each market segment.

This memo about market policy was much more than the now familiar market segmentation and value proposition for each segment. Sloan did something much more important by defining GM's central purpose as creating an aspirational escalator for every customer through the life cycle, from the used Chevrolet as their first purchase to the fancy Cadillac as their last (often concluding with a Cadillac hearse on the way to the cemetery!) And it worked brilliantly. General Motors was probably never as efficient in production as Ford and it was rarely a technology leader. But it provided a clear product pathway on the customer's life journey. Customers embraced this purpose and opened their wallets to pay higher prices for more refined products within each market segment. Within a few years of Sloan’s memo GM had became the largest and most successful corporation in the world and in the history of the world.

Moving forward to the present moment, it is saddening to read the viability plan GM recently proposed to the US Automotive Task Force. With the exception of the plug hybrid Volt (an unproven technology for an unproven market to be produced at tiny volume in the early years), the plan is entirely about "restructuring" and shrinking, about what General Motors isn't. It isn't Saab or Hummer or Saturn. It won’t have nearly as large a dealer network. It isn't a manufacturer with a significant North American footprint outside of Michigan and Ohio. Etc.

The natural instinct of senior managers in any crisis is to restructure and downsize. But the question is always, "Restructure and downsize toward what?" No customer cares about a company's structure. No customer cares about downsizing. Customers only care about a company solving their problems along life's path.

So here's my advice to new GM CEO Fritz Henderson or whoever may follow after him. Before you restructure, restate GM's purpose. Today no one knows. Do it in a simple memo. Indeed, do it in a single-page A3 format. Sloan needed three pages in 1921, so practice continuous improvement to get down to one! And remember that no amount of restructuring without a clear and compelling purpose will save this stricken giant (or any other failing enterprise.)

Best regards,

P.S. Toyota has gotten off lighter than GM in the current crisis, but it faces the same confusion about purpose. Until the mid-1990s the clear purpose of Toyota was to be the best organization in the world at providing refined, durable "value" products in all market segments with few delivered defects to customers. The assumption was that growth would naturally follow, and it did. But then the purpose seems to have shifted to becoming the biggest auto company as rapidly as possible by adding capacity everywhere, a purpose that no customer cares about. At the same time competitors, led by Hyundai, have closed the gap on Toyota's original purpose and everyone is doing hybrids where Toyota initially took the lead. An A3 on re-purposing Toyota is surely what new president Akio Toyoda needs as well. My fear is that he will only focus on cost reduction and restructuring.

Thursday, April 9, 2009

Article and Blog Addition

I have been giving a new blog a test drive and it has definitely passed my trial run. The blog I am referring to is entitled Get Rich Slowly. Not only is the author from the coolest state ever....Oregon, his posts are extremely well thought out and in line with my financial beliefs.

Check out this post for a sampling of the kind of insight this blog can provide. I know I keep referencing back to my definition of rich in the majority of my posts, but its like that old game slug bug where you punch your buddy in the arm every time you see a VW bug. Now that I have defined my definition I keep coming across pieces of work that reaffirm what I have come to believe. I might have to read the book he is referencing in this post as it probably has some great information to strengthen my beliefs towards wealth.

I like to make concepts into little memorable sayings, almost like a famous quote except I am far from famous. I guess it is my way of replicating that matter of fact truism effect that quotes have. My quote for the concept of living your life and enjoying not only the end state but the journey is, "always content; never satisfied." I try to tell myself to live that way. I try to always be happy but always want more for my life. Kind of new age-y as the Get Rich Slowly post would say but good words to live by. Enjoy the post and the new addition to the blogs that I follow.

An Apology and A Great Gino!!

First off let me apologize for the light bloggage the last few days. Obviously I cannot do any blogging at work, and our Internet at home has been having some technical difficulties to say the least. Luckily I have a beautiful and feisty wife who lays down the hammer on poor phone customer service.

To make it up to all you avid BadskiBlog readers I have decided to post one of the sickest ginos (goals) in the history of hockey. For all you non hockey players, I cannot even begin to explain the talent and audacity it took to score this goal and make it look so easy no less. The only thing I might enjoy more than this goal is listening to foreign announcers exclamations while watching this goal. Classic. Enjoy and hopefully I will bust out a few overdue posts in the next few days.

Tuesday, April 7, 2009

The Future of Publishing

I came across this article on CNN yesterday about the trend towards self publishing. I think it is pretty cool that authors who would never have opportunity to spread their message are now empowered to get their hands dirty and do it themselves.

I also think that it is about time there is a paradigm shift in publishing from an efficiency standpoint. Being as I am working to make the Air Force more lean, I can't help but have eyes for waste in other industries as well. The old way of publishing is writing a book and printing 3.000 copies with hope that you can sell them all. Self publishing is in essence a pull system. Books are only printed as they are ordered.

Later in the day I came across this post talking about the dangers of self publishing. In my opinion it is a little extreme. Sounds like a published author is a little worried about the future. I don't think traditional publishing is going away anytime soon and even if it did I think this guy is missing the point. I have already spoken about why I love blogs. I think that they truly are a meritocracy that even the playing field for people's point of view. The blogs that put out the best product virally build more and more readers. People link to other blogs, re post sections like I have done hear, email to friends, use programs like Digg or Stumble Upon and value is rewarded. I think that self published media would function in a very similar fashion.

My view is why fight the future? Adapt and find ways to incorporate the ways of the future to better your life. Plus I think I have a better chance self publishing than getting a traditional publisher's backing, and given that I originally wanted to be a creative writer growing up (go figure) I think that the opportunity to put out your own book is pretty cool.

Sunday, April 5, 2009

Professional Athletes and Money

My buddy Paul actually sent me this article about how professional athletes go broke after their careers are over. It strengthen my beliefs in my definition of being rich and the importance of valuing something other than money in your life. Pauly and I have actually talked about this quite a bit since he currently is a professional athlete and has direct contact with people who are the embodiment of what this article is about. Granted hockey is less affected than the NFL, but I know there are lesser degrees of the same epidemic within the NHL and perhaps greater degrees.

The article is really long but definitely worth reading. There were a few different sections that really caught my attention.

Then there are the unnamed athletes and team personnel who pawned 400 title rings to the online reseller over the past three months, a spike of about 33% from the same period last year. (A 2008 Giants Super Bowl ring was among them.) "It's mostly younger players who've been selling," says Tim Robins, the site's owner. "It's the economy. Selling these items is always embarrassing, a last resort."

I can think of nothing worse than this example of going broke as a pro athlete. Championship rings are priceless. I would rather sell a kidney than a championship ring, and just validating that something like this exists makes me sick. It's all about education. I wish some of these guys would practice the same discipline and commitment to self improvement when it comes to finances as they do on the battlegrounds of friendly strife.

"With athletes, there's an extraordinary metamorphosis of financial challenge," says agent Leigh Steinberg, who has represented the NFL's No. 1 pick a record eight times. "Coming off college scholarships, they probably haven't even learned the basics of budgeting or keeping receipts." Which then triggers two fatal mistakes: hiring the wrong people as advisers, and trusting them far too much.

I can't really speak to experiencing the financial vultures descending upon me, since by conventional definitions I am no where near what most people would consider rich. However, I think this is another area where a lot of these guys get into big trouble. "Who benefits" is a question more of these guys should ask themselves. I can only imagine all the people who are constantly approaching today's professional athlete with "opportunity" after "opportunity." I would struggle with this as well as I tend to give people the benefit of the doubt, but I think if people did a simple cost benefit analysis of what they are giving up and what they are getting they would be in a better spot. Not to mention when you are cold called about an opportunity without a prior relationship it likely is not an opportunity; its a sales call. I imagine its hard to deal with.

Sometimes though, a jock just can't shake the temptation to try to hit the jackpot. Butowsky believes that "there's something in an athlete's mentality" that drives him to swing for the fences financially—usually at his own peril. "The solution to the problem is, without a doubt, education," the adviser says. "Change won't happen until grown men start wanting to learn."

I love this quote. I love it. This isn't an athlete problem, its a human problem. Until we start taking responsibility for our lives, financially and beyond, we have no right to place blame. If these athletes spent one hour each road trip reading a book on personal finance they would likely eliminate 99% of the problems they face financially. Their ability to at least track what someone else is saying would increase dramatically, they would be a better judge of character and motives amongst their financial acquaintances, and they would have a much better ability to recognize that the opportunities that are too good to be true are, in fact, too good to be true.

All in all I think the article is great. It illustrates that income does not matter. It reaffirms the Badski definition of rich and it is empowering in the sense that it shows that your financial destiny is in your hands no matter what your W-2 reads.