In recent posts I analyzed the “George Fund” and reported on things that George did right. But I also mentioned that the George Fund included a few “dogs” that needed to be sold. Can we learn anything by looking at the losers? Yes, we can.
Four of the stocks (most of the dogs) were in local (in or near Akron, Ohio) companies. I believe George bought these stocks for one of three reasons:
1. George was a businessman in the community and wanted to support other community businesses.
2. Many of his friends and acquaintances worked at these companies, so it gave George something to talk about. As mentioned previously, George was a huge “people person” and loved talking to people.
3. Many of George’s customers worked at these companies and it would be good for George’s business if people knew he was investing in their companies.
Of course it is impossible for me to know why George bought these stocks, but it was probably a combination of all three reasons. But that reveals a flaw in George’s decisions. The only one of the reasons that is legitimate is number three and only because you may be getting an indirect return on your investment.
It leads to the question: Why do you invest? The correct answer is: To end up with more money that what you started with.
You should invest your money to make more money, period. This is a totally acceptable concept and in its pure form does not involve greed. Wise investing has been endorsed at the highest level. In the “Parable of the Talents”, Jesus Christ uses the example of financial investment to make a point about spiritual matters. But the context is that financial investing to acquire more money is indeed good. Experienced investors know that greed is indeed bad (been there, done that, lost some coin.) Jesus didn’t care much for greed either.
So investing is good, but the purpose of investing is to make money. It is not to support your community, it is not to support your friends, and it is not for derived benefits. And most importantly, it is not to be done to make you feel good. We are emotional and rational beings. We make our investment mistakes when we become less rational and more emotional.
If you want to support “green” energy initiatives, buy the products, donate to the causes, but don’t invest in the companies unless you do the research and determine it is a good investment. It feels good to invest in a “religious” mutual fund where all the companies claim to adhere to certain principles, but the companies are chosen based on principles first and then results. You are investing for results. Give money to your church, give money to the poor, but invest your money based on your risk/return tolerance. If you love the food at a large restaurant chain, eat there as often as you wish. However, this is not a valid reason to invest in the stock (I have made this mistake). The only time I want to feel good about my investments is when I review my statements at the end of the month.
For a personal application, I will use the Smucker’s Corporation as an example. Here are the factors that influence my personal opinion of the company:
1. I love Smucker’s products. They make some of the best tasting products around.
2. Smucker’s is a local company with a great reputation and it supports the community.
3. I have friends that work at Smucker’s.
4. I have relatives that get paid to serve on Smucker’s food tasting panels.
5. Smucker’s is a strong supporter of my college alma mater.
Therefore, I would feel great if I purchased Smucker’s stock. It would be fun to own stock in this company. It would be enjoyable to tell people I am a Smucker’s stockholder. It would even make my peanut butter sandwich and cup of coffee taste better.
But none of these factors are valid reasons to buy the stock. It may be a great investment, but that is determined by research based on data, not emotions.
Conversely, I was seriously considering investing in a “green” energy company based on its growth potential and dividend even though I am not hot on the idea of wind and solar power. However, I have backed off the stock based on experts reporting that some subsidies will get cut in the next budget.
We are humans, not Vulcans, but I think Vulcans probably make better investors. This is not to say that moral and ethical factors are irrelevant when making investment decisions. These often come into play when deciding where “not” to invest. These will be discussed next time.
Monday, July 18, 2011
Monday, July 4, 2011
The “Grocery Cart” Recovery
The night was black, the roads were icy
Snow was fallin', drifts were high
And I was weary from my drivin'
And I stopped to rest for a while
I sat down at a truck stop
I was thinking about my past
I've had a long streak of that bad luck
But I'm praying it's gone at last
When you push a shopping cart in the grocery store it rolls very easily on the smooth, level, floor. However when you push the same cart on the store parking lot, it moves much more slowly and any bump, crack, imperfection or even a pebble can impede its progress.
Well, our economy is the shopping cart and after moving fairly well on the smooth surface, it has been struggling to overcome the obstacles in the parking lot in the first half of the year.
What were the obstacles?
1. Bad Weather – Snow storms, ice storms, tornados, floods. And weather statistics are usually useless when determining economic impact. It doesn’t matter if total snowfall for the season is “average”. It depends where it falls, when it falls, how much falls at one time and how icy it makes the roads and runways.
2. Bad Karma – The Middle East has been in political and social turmoil for several months. Do you think that people might get concerned as they watch the possible start of World War 3 on their big screens? And it’s alarming for the U.S. to enter its third war when we are having problems ending the first two.
3. Bad Gas – The Middle East turmoil only generated a “fear impact” until things in Libya heated up. The disruption in crude supply caused gas prices to spike. This sucks huge amounts of money out of our economy and severely limits consumer discretionary spending.
4. Bad Supply Chain – Who knew the impact of the Japanese tsunami would eventually be felt
here? This slowed the growth of several industries, especially the auto industry. The decrease in supply of autos resulted in higher prices for most brands. This of course led to lower industry sales.
After making it through the tough first half of 2011, let’s take a look at some key economic indicators:
Housing
I believe the housing market hit bottom in February and has been dragging across the bottom ever since. We have seen this in various industries during the downturn. The reason housing is the last to bottom out is that it had the furthest to drop and the government’s misguided attempt to prop of the sector. If the government had stayed out of the way, housing hits the bottom much earlier and would be recovering right now. Regardless, the housing market should start its recovery soon. It will not be strong enough to significantly help the economy this year; however it will cease to be a drag and that is a very good thing.
Inventory / Freight
Companies currently have a good read on inventory levels and cut stocks as soon as consumer spending slowed. As a result, all trucking freight indexes have gone negative the last couple months. Rail freight has slowed, but not as much. The good news here is inventories are very lean and any increase in consumer sales will immediately result in more production and more freight (which probably happened in June). In addition, activity at the commercial ports shows that import and export activity was not significantly impacted by the slowdown.
Manufacturing
The ISM (Purchasing Manager’s) Index says manufacturing activity increased unexpectedly in June. Orders were up, employment was up and production was up. Imports and Exports also increased (conformation of the port data above).
Unemployment
Unemployment remains high, but don’t believe the rule that GDP has to be greater than 3% for the unemployment rate to decrease. This is one of the old rules that don’t apply to conditions right now. Remember, many traditional indicators (and rules) are not relevant right now due to the unusual circumstances. Many companies cut employment too deep during the recession and are starting to “right size”. A profession recruiter told me that his business in March was stronger than it had ever been. Of course the “bad” factors have tempered this some. Job growth should resume increasing very soon.
Auto Sales
Auto sales should jump in the second half of the year. Supply will increase, prices (through incentives) decrease and there is significant pent-up demand in the market. Showroom traffic has already started to increase.
Restaurant Index
The Restaurant Index was down in May as a result of the high gas prices, but the index had shown solid gains prior to that. Almost all the restaurants near my house that closed during the recession have reopened (under new names) and Friday night waiting lines are back to normal levels. The Hotel Occupancy Index was up 2.8% in May, another sign that consumer discretionary spending is starting to roll.
What Happens Now?
It looks like the shopping cart has just reentered the store. But it is still a shopping cart. Not a Lamborghini. Not a Ford. Not even one of those motorized scooters (that blatantly and publically rip off Medicare) that you see advertised on television. This recovery is everything we expected it to be (or not to be) at this point: slow and bumpy.
My panel of experts is forecasting GDP growth of 3.3% in Q3 and 3.2% in Q4. The Model T is more positive so I would add 0.5% on to both estimates. The Model T is still indicating a much stronger 2012.
Good Times?
The weather is improving, the Middle East appears controllable and Japan should be back ramping up production soon. This just leaves gas prices as an obstacle and that brings us to the Libyan situation.
The Chicago thug tactics, lean on the guy until he leaves, are not working. Khadafy is tougher than we thought. But I have an idea. Instead of using bombs, I would use a bombshell. All we need to do is find him asylum in some country, then pay his blonde, voluptuous, nurse (now in Norway) to go there. Next she tells Moammar where she is and that she misses him badly. Game over, gas prices fall.
Once in a while from out of nowhere
When you don't expect it and you're unprepared
Somebody will come and lift you higher
And your burdens will be shared
Yes I do believe, if I hadn't met you
I might still be sinking fast
I've had a long streak of bad luck
But I pray it's gone at last
Gone at last, gone at last
Gone at last, gone at last
I had a long streak of bad luck
But I pray it's gone at last
Gone at Last - Paul Simon
Snow was fallin', drifts were high
And I was weary from my drivin'
And I stopped to rest for a while
I sat down at a truck stop
I was thinking about my past
I've had a long streak of that bad luck
But I'm praying it's gone at last
When you push a shopping cart in the grocery store it rolls very easily on the smooth, level, floor. However when you push the same cart on the store parking lot, it moves much more slowly and any bump, crack, imperfection or even a pebble can impede its progress.
Well, our economy is the shopping cart and after moving fairly well on the smooth surface, it has been struggling to overcome the obstacles in the parking lot in the first half of the year.
What were the obstacles?
1. Bad Weather – Snow storms, ice storms, tornados, floods. And weather statistics are usually useless when determining economic impact. It doesn’t matter if total snowfall for the season is “average”. It depends where it falls, when it falls, how much falls at one time and how icy it makes the roads and runways.
2. Bad Karma – The Middle East has been in political and social turmoil for several months. Do you think that people might get concerned as they watch the possible start of World War 3 on their big screens? And it’s alarming for the U.S. to enter its third war when we are having problems ending the first two.
3. Bad Gas – The Middle East turmoil only generated a “fear impact” until things in Libya heated up. The disruption in crude supply caused gas prices to spike. This sucks huge amounts of money out of our economy and severely limits consumer discretionary spending.
4. Bad Supply Chain – Who knew the impact of the Japanese tsunami would eventually be felt
here? This slowed the growth of several industries, especially the auto industry. The decrease in supply of autos resulted in higher prices for most brands. This of course led to lower industry sales.
After making it through the tough first half of 2011, let’s take a look at some key economic indicators:
Housing
I believe the housing market hit bottom in February and has been dragging across the bottom ever since. We have seen this in various industries during the downturn. The reason housing is the last to bottom out is that it had the furthest to drop and the government’s misguided attempt to prop of the sector. If the government had stayed out of the way, housing hits the bottom much earlier and would be recovering right now. Regardless, the housing market should start its recovery soon. It will not be strong enough to significantly help the economy this year; however it will cease to be a drag and that is a very good thing.
Inventory / Freight
Companies currently have a good read on inventory levels and cut stocks as soon as consumer spending slowed. As a result, all trucking freight indexes have gone negative the last couple months. Rail freight has slowed, but not as much. The good news here is inventories are very lean and any increase in consumer sales will immediately result in more production and more freight (which probably happened in June). In addition, activity at the commercial ports shows that import and export activity was not significantly impacted by the slowdown.
Manufacturing
The ISM (Purchasing Manager’s) Index says manufacturing activity increased unexpectedly in June. Orders were up, employment was up and production was up. Imports and Exports also increased (conformation of the port data above).
Unemployment
Unemployment remains high, but don’t believe the rule that GDP has to be greater than 3% for the unemployment rate to decrease. This is one of the old rules that don’t apply to conditions right now. Remember, many traditional indicators (and rules) are not relevant right now due to the unusual circumstances. Many companies cut employment too deep during the recession and are starting to “right size”. A profession recruiter told me that his business in March was stronger than it had ever been. Of course the “bad” factors have tempered this some. Job growth should resume increasing very soon.
Auto Sales
Auto sales should jump in the second half of the year. Supply will increase, prices (through incentives) decrease and there is significant pent-up demand in the market. Showroom traffic has already started to increase.
Restaurant Index
The Restaurant Index was down in May as a result of the high gas prices, but the index had shown solid gains prior to that. Almost all the restaurants near my house that closed during the recession have reopened (under new names) and Friday night waiting lines are back to normal levels. The Hotel Occupancy Index was up 2.8% in May, another sign that consumer discretionary spending is starting to roll.
What Happens Now?
It looks like the shopping cart has just reentered the store. But it is still a shopping cart. Not a Lamborghini. Not a Ford. Not even one of those motorized scooters (that blatantly and publically rip off Medicare) that you see advertised on television. This recovery is everything we expected it to be (or not to be) at this point: slow and bumpy.
My panel of experts is forecasting GDP growth of 3.3% in Q3 and 3.2% in Q4. The Model T is more positive so I would add 0.5% on to both estimates. The Model T is still indicating a much stronger 2012.
Good Times?
The weather is improving, the Middle East appears controllable and Japan should be back ramping up production soon. This just leaves gas prices as an obstacle and that brings us to the Libyan situation.
The Chicago thug tactics, lean on the guy until he leaves, are not working. Khadafy is tougher than we thought. But I have an idea. Instead of using bombs, I would use a bombshell. All we need to do is find him asylum in some country, then pay his blonde, voluptuous, nurse (now in Norway) to go there. Next she tells Moammar where she is and that she misses him badly. Game over, gas prices fall.
Once in a while from out of nowhere
When you don't expect it and you're unprepared
Somebody will come and lift you higher
And your burdens will be shared
Yes I do believe, if I hadn't met you
I might still be sinking fast
I've had a long streak of bad luck
But I pray it's gone at last
Gone at last, gone at last
Gone at last, gone at last
I had a long streak of bad luck
But I pray it's gone at last
Gone at Last - Paul Simon
Sunday, June 26, 2011
George Is Still The Boss!
(Part 2 of the series, please read By George I Think He Got It Right, the previous post, before reading this one)
What to do with the George Fund? My first inclination is to make no changes, to treat it as a treasured heirloom. It was my grandfather’s, and then my mother’s and now mine. What right do I have to change it? Then the light went on, actually the whole room lit up. Last time I wrote that I never could figure out why my mother never sold the stocks in 30 years of ownership, now I know why. If I was having these feelings now because this was my grandfather’s, her feelings were even more intense. I think she viewed the portfolio as sacred. This reverence was no doubt expressed to me by voice tone and facial expression when she talked about the stocks. (I’m amazed by how you suddenly understand your parents’ difficult decisions when you unexpectedly have to make those same decisions in your life. Also, we communicate values to our children not by what we say, but what we do, including “how” we say it).
The decision about what to do still remained tough. It was almost if the stocks were “alive”. They grew some days, shrank some others and sent gifts (dividend checks) almost every month. Was I going to just sell assets, or was I going to perform surgery?
I needed guidance. Who to go to? I decided to ask the person who knew the fund better than anyone. I decided to ask George. The moment I asked two questions: “What would George think?” And “What would George do now?” I started to make progress. Yes, I tied to “channel” George. This is ironic because I am an investor because of George. As I wrote about a year ago, I have owned stocks literally my entire life because George gave me three stocks when I was born. Also, I had a great uncle who was a day-trader in the 1920’s. How did you day trade then? You caught the trolley every day to the brokerage house downtown. You negotiated a bulk trading rate (wonder how close it was in real terms to $7 trades today) and you watched the “stock ticker” and traded away. He made a good living doing this until the 1929 stock market crash.
What Would George Think?
George would be proud that the fund has done so well over the past 40 years. But I think George would then say, ”Yes, this is good, but somebody needs to do something about these “dog” stocks. Why are they still here? Boy, you’ve got some work to do!”
What would George Do Now?
To answer this one, I had to study the George Fund in careful detail. It is similar to an archeologist studying a find that had been well preserved for a long time period.
You always hear that you should invest what you know. What George knew was food products and retailing. The portfolio does not include any company in these sectors. I think George had seen many companies in these sectors come and go and thought they were not solid investments.
The companies in the George Fund are all (except one) industrial manufactures. There are several “heavy” manufacturing firms. It is also diversified among industrial sectors. There are oil companies, pharmaceutical companies and chemical companies as well. I determined that all of the companies paid dividends when George originally bought the stocks. The only service firm was a railroad company (you have to transport all that heavy stuff).
The Goal
Before making any changes it is important to establish the purpose for me of this investment. The George Fund will be for me the classic “basket of dividend stocks” that you often read about. The dividends will help pay living expenses in retirement (along with my IRA and 401-K) and the stock portfolio value can then be passed on to my decedents.
What Gets Dumped?
The first part of this is easy. Any company that no longer pays dividends will no longer be in the fund. Of course if the company had to eliminate its dividend, it has had some financial problems and is a weak performer anyway.
The second part of the divesture strategy is brutally tough. Because the top stocks have performed so well, the fund is out of balance. The top stock (a pharmaceutical firm), now makes up over 25% of the portfolio. To maintain diversification and balance, holdings in the top performers must be reduced. This is very difficult to actually do. In addition, some holdings in stocks where the dividends were low will be reduced also.
What to Add?
Obviously no consumer goods or retail stocks will be added. I will add at least one utility and maybe two (Exelon and First Energy look good). Utilities weren’t publically traded when George was buying stock, so that’s why there are none currently in the fund. Utilities make stuff (energy) and pay nice dividends. I probably need a high-tech company to bring the portfolio into the 21st century. It’s difficult to find dividend stocks in this sector. I’m thinking maybe Intel. I also need some healthcare product companies to modernize the group. I’m looking at Baxter and Johnson and Johnson. I may even add a service provider. Both AT&T and Verizon are possibilities. They pay good dividends and should be around for a long time. The other candidates are a natural gas company and a mineral mining (stuff to make stuff with) firm.
The New George Fund
The New George Fund should have around 20 stocks (like the original) that pay decent dividends. I will have changed about 25% of the fund, which means the “base” 75% remains solid. The portfolio will be more diversified, balanced and stronger with less risk than when I began the process. I think George would approve of the changes and that’s far good enough for me. Now it’s time to get some lemonade and enjoy the summer!
What to do with the George Fund? My first inclination is to make no changes, to treat it as a treasured heirloom. It was my grandfather’s, and then my mother’s and now mine. What right do I have to change it? Then the light went on, actually the whole room lit up. Last time I wrote that I never could figure out why my mother never sold the stocks in 30 years of ownership, now I know why. If I was having these feelings now because this was my grandfather’s, her feelings were even more intense. I think she viewed the portfolio as sacred. This reverence was no doubt expressed to me by voice tone and facial expression when she talked about the stocks. (I’m amazed by how you suddenly understand your parents’ difficult decisions when you unexpectedly have to make those same decisions in your life. Also, we communicate values to our children not by what we say, but what we do, including “how” we say it).
The decision about what to do still remained tough. It was almost if the stocks were “alive”. They grew some days, shrank some others and sent gifts (dividend checks) almost every month. Was I going to just sell assets, or was I going to perform surgery?
I needed guidance. Who to go to? I decided to ask the person who knew the fund better than anyone. I decided to ask George. The moment I asked two questions: “What would George think?” And “What would George do now?” I started to make progress. Yes, I tied to “channel” George. This is ironic because I am an investor because of George. As I wrote about a year ago, I have owned stocks literally my entire life because George gave me three stocks when I was born. Also, I had a great uncle who was a day-trader in the 1920’s. How did you day trade then? You caught the trolley every day to the brokerage house downtown. You negotiated a bulk trading rate (wonder how close it was in real terms to $7 trades today) and you watched the “stock ticker” and traded away. He made a good living doing this until the 1929 stock market crash.
What Would George Think?
George would be proud that the fund has done so well over the past 40 years. But I think George would then say, ”Yes, this is good, but somebody needs to do something about these “dog” stocks. Why are they still here? Boy, you’ve got some work to do!”
What would George Do Now?
To answer this one, I had to study the George Fund in careful detail. It is similar to an archeologist studying a find that had been well preserved for a long time period.
You always hear that you should invest what you know. What George knew was food products and retailing. The portfolio does not include any company in these sectors. I think George had seen many companies in these sectors come and go and thought they were not solid investments.
The companies in the George Fund are all (except one) industrial manufactures. There are several “heavy” manufacturing firms. It is also diversified among industrial sectors. There are oil companies, pharmaceutical companies and chemical companies as well. I determined that all of the companies paid dividends when George originally bought the stocks. The only service firm was a railroad company (you have to transport all that heavy stuff).
The Goal
Before making any changes it is important to establish the purpose for me of this investment. The George Fund will be for me the classic “basket of dividend stocks” that you often read about. The dividends will help pay living expenses in retirement (along with my IRA and 401-K) and the stock portfolio value can then be passed on to my decedents.
What Gets Dumped?
The first part of this is easy. Any company that no longer pays dividends will no longer be in the fund. Of course if the company had to eliminate its dividend, it has had some financial problems and is a weak performer anyway.
The second part of the divesture strategy is brutally tough. Because the top stocks have performed so well, the fund is out of balance. The top stock (a pharmaceutical firm), now makes up over 25% of the portfolio. To maintain diversification and balance, holdings in the top performers must be reduced. This is very difficult to actually do. In addition, some holdings in stocks where the dividends were low will be reduced also.
What to Add?
Obviously no consumer goods or retail stocks will be added. I will add at least one utility and maybe two (Exelon and First Energy look good). Utilities weren’t publically traded when George was buying stock, so that’s why there are none currently in the fund. Utilities make stuff (energy) and pay nice dividends. I probably need a high-tech company to bring the portfolio into the 21st century. It’s difficult to find dividend stocks in this sector. I’m thinking maybe Intel. I also need some healthcare product companies to modernize the group. I’m looking at Baxter and Johnson and Johnson. I may even add a service provider. Both AT&T and Verizon are possibilities. They pay good dividends and should be around for a long time. The other candidates are a natural gas company and a mineral mining (stuff to make stuff with) firm.
The New George Fund
The New George Fund should have around 20 stocks (like the original) that pay decent dividends. I will have changed about 25% of the fund, which means the “base” 75% remains solid. The portfolio will be more diversified, balanced and stronger with less risk than when I began the process. I think George would approve of the changes and that’s far good enough for me. Now it’s time to get some lemonade and enjoy the summer!
Tuesday, June 14, 2011
By George, I Think He Got It Right
The subject of today’s post is the By George Mutual Fund (BGMF). You have never heard of it because it is one of the most exclusive funds in the world, yet it is a part of my portfolio. How was I able to get into this elite investment? Well it just turns out that I am the only investor and thus own all the money remaining in the fund.
The BGMF was created by my grandfather George around 40 years ago. It consists of shares in 20 common stocks. When he died 30 years ago, the fund was inherited by his children. While I assume that the other shares of the fund have long been sold off, the portion inherited by my mother remains largely intact. My mother owned the BGMF for 30 years, the only decisions she made was to redeem shares for cash when offered due to buybacks or transfers. Other than that, the BGMF was not “managed” or intentionally varied in 40 some years. I always wondered why my mother didn’t sell it all due to the work involved handing dividend checks and all the paperwork and tax issues that come with direct stock ownership.
The Man Behind the BGMF
George the Businessman
George obtained his wealth through hard work. He started off as a teacher (I teach part-time and several cousins are teacher/educators, funny how that works), but soon found his passion and opened a small grocery store. George was an excellent store owner. His outstanding people skills combined with natural business acumen resulted in continuous success.
His store grew in size throughout the years and George had some money in the bank. At this point most people would have opened more grocery stores in order to gain more wealth, but not George. I think that George loved what he was doing, which was personally connecting with his customers, personally connecting with his employees and cutting meat. More stores would mean that he would be managing store, and not doing what he truly loved. This brings us to:
Life Lesson #1: Find out what you love doing and then do it well as you possibly can.
George the Person
I have to say something about George the person. George was very generous. My mother told me stories about how he let his customers run up credit during The Great Depression when they didn’t have jobs and he had no assurance he would ever be paid. He also would give away soup bones to others who were hungry.
Life Lesson #2: Having the money isn’t as important as helping others with your money. (If you don’t agree with this one, I suggest you give a try and see what happens)
George’s people skills were extraordinary. I watched him interact with customers in the store, but was too young at the time to realize just what was really happening. But I now see the impact based on what people said about my mother’s people skills and my interactions with my uncles (one still living). The most important person in the world to my uncle(s) is the person he is talking to at the time. You just feel after having a conversation (about anything) with these guys. That’s a special gift and they got it from George.
Life Lesson #3: Treat everyone (no matter income, race, religion, appearance, etc.) with the utmost respect. Everyone you interact with should be important to you.
George the Investor
So instead of investing in more stores, George invested in the stock market. That way George got to continue doing what he loved and to increase his wealth by doing what he liked (investing in the stock market). And he was good at it.
The incredible thing about the BGMF is how solid it is after 40 years. This is the mother of all “buy and hold” strategies. As far as I can tell, the portfolio when George stopped managing it had stock in 20 companies. It has 20 companies today. Only one company went out of business and one company spun off a new company, so there are still stocks of 20 companies in the fund today.
Many of the companies in the fund are strong blue-chip stocks. There are a few “weak sisters”, but that is to be expected. George believed in diversification. Of course if he had bought only the five best stocks, the fund would be worth much more today. But if he had bought the five worst, it would not be worth very much at all. George knew he would make mistakes so he spread the risk.
Life Lesson #4: You are not going to be right all the time, so make sure you prepare for those times when you will be wrong. In investing, that means diversify, diversify, and diversify some more.
The bottom line is that George was one great stock picker. To put together a portfolio that has withstood the changes and crises over the past 40 years and is so solid today is remarkable. When I told my broker (who now services the account) the history of the BGMF, he was speechless. I have even more respect for George because in doing the research for this post I discovered that the worst performing stock in the fund is not a stock that he bought, but the spinoff mentioned earlier.
What Now?
So upon the death of my mother a year ago, I became sole owner and now manager of the BGMF. What to do, what to do? Me. The person who bought into Braniff Airlines (bankrupt), Storage Technologies (bankrupt), Home Centers (bankrupt) and Gliatech (bankrupt). It would seem that the BGMF could be in grave danger.
To Be Continued ………..
The BGMF was created by my grandfather George around 40 years ago. It consists of shares in 20 common stocks. When he died 30 years ago, the fund was inherited by his children. While I assume that the other shares of the fund have long been sold off, the portion inherited by my mother remains largely intact. My mother owned the BGMF for 30 years, the only decisions she made was to redeem shares for cash when offered due to buybacks or transfers. Other than that, the BGMF was not “managed” or intentionally varied in 40 some years. I always wondered why my mother didn’t sell it all due to the work involved handing dividend checks and all the paperwork and tax issues that come with direct stock ownership.
The Man Behind the BGMF
George the Businessman
George obtained his wealth through hard work. He started off as a teacher (I teach part-time and several cousins are teacher/educators, funny how that works), but soon found his passion and opened a small grocery store. George was an excellent store owner. His outstanding people skills combined with natural business acumen resulted in continuous success.
His store grew in size throughout the years and George had some money in the bank. At this point most people would have opened more grocery stores in order to gain more wealth, but not George. I think that George loved what he was doing, which was personally connecting with his customers, personally connecting with his employees and cutting meat. More stores would mean that he would be managing store, and not doing what he truly loved. This brings us to:
Life Lesson #1: Find out what you love doing and then do it well as you possibly can.
George the Person
I have to say something about George the person. George was very generous. My mother told me stories about how he let his customers run up credit during The Great Depression when they didn’t have jobs and he had no assurance he would ever be paid. He also would give away soup bones to others who were hungry.
Life Lesson #2: Having the money isn’t as important as helping others with your money. (If you don’t agree with this one, I suggest you give a try and see what happens)
George’s people skills were extraordinary. I watched him interact with customers in the store, but was too young at the time to realize just what was really happening. But I now see the impact based on what people said about my mother’s people skills and my interactions with my uncles (one still living). The most important person in the world to my uncle(s) is the person he is talking to at the time. You just feel after having a conversation (about anything) with these guys. That’s a special gift and they got it from George.
Life Lesson #3: Treat everyone (no matter income, race, religion, appearance, etc.) with the utmost respect. Everyone you interact with should be important to you.
George the Investor
So instead of investing in more stores, George invested in the stock market. That way George got to continue doing what he loved and to increase his wealth by doing what he liked (investing in the stock market). And he was good at it.
The incredible thing about the BGMF is how solid it is after 40 years. This is the mother of all “buy and hold” strategies. As far as I can tell, the portfolio when George stopped managing it had stock in 20 companies. It has 20 companies today. Only one company went out of business and one company spun off a new company, so there are still stocks of 20 companies in the fund today.
Many of the companies in the fund are strong blue-chip stocks. There are a few “weak sisters”, but that is to be expected. George believed in diversification. Of course if he had bought only the five best stocks, the fund would be worth much more today. But if he had bought the five worst, it would not be worth very much at all. George knew he would make mistakes so he spread the risk.
Life Lesson #4: You are not going to be right all the time, so make sure you prepare for those times when you will be wrong. In investing, that means diversify, diversify, and diversify some more.
The bottom line is that George was one great stock picker. To put together a portfolio that has withstood the changes and crises over the past 40 years and is so solid today is remarkable. When I told my broker (who now services the account) the history of the BGMF, he was speechless. I have even more respect for George because in doing the research for this post I discovered that the worst performing stock in the fund is not a stock that he bought, but the spinoff mentioned earlier.
What Now?
So upon the death of my mother a year ago, I became sole owner and now manager of the BGMF. What to do, what to do? Me. The person who bought into Braniff Airlines (bankrupt), Storage Technologies (bankrupt), Home Centers (bankrupt) and Gliatech (bankrupt). It would seem that the BGMF could be in grave danger.
To Be Continued ………..
Monday, May 30, 2011
She’s Nobody’s Fool
Almost every important economic indicator was either negative or less positive in April. In addition, Q1 GDP came in at a disappointing 1.8%. This resulted in numerous articles declaring the recovery over with disastrous consequences ahead. So what is going on? How much trouble are we in?
Due to the damaged financial system, the housing market collapse, the restructuring of the employment markets and all the problems created during the Great Recession, this recovery is expected to be slower, weaker, and uneven. When the economy stabilized, it started going through “normal” cycles, but at a lower growth rate. The economy now is still cycling, but is moving upward at a slow pace. A strong recovery is able to cast off obstacles the same way Arnold Schwarzenegger is able to cast off women …, sorry I mean cast off attackers in the movies. A weak economy gets diverted by any bumps in the road.
And 2011 has been full of obstacles. The first was (and still is) unusually bad weather. There was very cold weather in the South, ice storms and flooding in the Midwest and huge snowstorms in the East. This weather caused major business disruptions in a wide swath of the nation. This nasty weather has continued into the spring. Tornados and rainstorms are battering the country and hurricane season is just starting. A robust economy absorbs this hit. A strong recovery puts on a jacket and barrels through. But a weak recovery catches a cold.
The next obstacle is the unrest in the Middle East. One of the consequences of our mass mediated news coverage is that we tend to forget the recent past very quickly. Beginning in February, everyone was very worried as protests and revolts started in several nations. We were already fighting two wars, briefly involved in a third and hoping World War Three wasn’t beginning. (On a side note, it is interesting that the “fake” end of the world received extensive media coverage while a potential “real” end of the world, the initial uprising in Saudi Arabia, received relatively minor coverage). Once again, a strong recovery gets past this, but a weak economy gets the shakes.
Of course the Middle East situation caused crude oil prices to spike. Most of this was speculation. You know this because most crude production was briefly affected in Libya (the rebels plan to restart production in their fields soon). Once Moammar and the rebels figured out how to milk the cow and keep fighting each other at the same time, things stabilized. The speculators are keeping the price high because there is still considerable unrest in the region. You can’t really blame them for trying. If the Saudis get overthrown, crude would shoot to over $200/barrel and retail prices would go to $10 a gallon, or the end of the world as we know it.
Higher gas prices are a tough obstacle for any economy and a big problem for this one. High gas prices act just like a tax on disposable income and really hurt lower-income people.
So what is this economy like? It’s sensitive, it’s cautious, it’s mysterious. It can be strong, it can be weak, and without warning it can be anything in between. That’s correct, this economy is a woman! This observation should be viewed as purely descriptive and is not derogatory or sexist in any way.
(Cue Billy Joel)
She can kill with a smile
She can wound with her eyes
She can ruin your faith with her casual lies
And she only reveals what she wants you to see
She hides like a child,
But she's always a woman to me
She can lead you to love
She can take you or leave you
She can ask for the truth
But she'll never believe you
And she'll take what you give her, as long as it's free
Yeah, she steals like a thief
But she's always a woman to me
You see this economy has been hurt very deeply by all the turmoil of the last few years. She has been lied to. She has been deceived. Her trust has been broken. She has been betrayed. She feels like we have been insensitive to her needs, she feels violated.
She is not really moved by some short-term, artificial, stimulus. She wants a real, long-term commitment. This relationship can be restored, but it will take time. She wants to take it slow and cautiously. She wants it to be deep, meaningful and long-lasting.
And she'll promise you more
Than the Garden of Eden
Then she'll carelessly cut you
And laugh while you're bleedin'
But she'll bring out the best
And the worst you can be
Blame it all on yourself
Cause she's always a woman to me
She is frequently kind
And she's suddenly cruel
She can do as she pleases
She's nobody's fool
And she can't be convicted
She's earned her degree
And the most she will do
Is throw shadows at you
But she's always a woman to me
We want to tell her that we really didn’t mean anything by it. That we wish that it never happened. That we need to get beyond this and just get back to the way things were before. And we promise that it will never, ever, happen again. We’re sorry baby, we are so very, very, sorry.
So what do we need to get this recovery (or to heal this relationship) to get going again? First, we need for the Middle East to stabilize. We are leaning on Khadafy like Chicago thugs (wonder where that idea came from?) and I actually think that it’s going to work. Second, we need the weather to get back to normal. Third, as the Middle East calms down, so will the speculators demand for crude oil futures. And finally, some Barry White music couldn’t hurt.
She's Always A Woman - Billy Joel
Please check out my new humor blog Next post: June 2
Due to the damaged financial system, the housing market collapse, the restructuring of the employment markets and all the problems created during the Great Recession, this recovery is expected to be slower, weaker, and uneven. When the economy stabilized, it started going through “normal” cycles, but at a lower growth rate. The economy now is still cycling, but is moving upward at a slow pace. A strong recovery is able to cast off obstacles the same way Arnold Schwarzenegger is able to cast off women …, sorry I mean cast off attackers in the movies. A weak economy gets diverted by any bumps in the road.
And 2011 has been full of obstacles. The first was (and still is) unusually bad weather. There was very cold weather in the South, ice storms and flooding in the Midwest and huge snowstorms in the East. This weather caused major business disruptions in a wide swath of the nation. This nasty weather has continued into the spring. Tornados and rainstorms are battering the country and hurricane season is just starting. A robust economy absorbs this hit. A strong recovery puts on a jacket and barrels through. But a weak recovery catches a cold.
The next obstacle is the unrest in the Middle East. One of the consequences of our mass mediated news coverage is that we tend to forget the recent past very quickly. Beginning in February, everyone was very worried as protests and revolts started in several nations. We were already fighting two wars, briefly involved in a third and hoping World War Three wasn’t beginning. (On a side note, it is interesting that the “fake” end of the world received extensive media coverage while a potential “real” end of the world, the initial uprising in Saudi Arabia, received relatively minor coverage). Once again, a strong recovery gets past this, but a weak economy gets the shakes.
Of course the Middle East situation caused crude oil prices to spike. Most of this was speculation. You know this because most crude production was briefly affected in Libya (the rebels plan to restart production in their fields soon). Once Moammar and the rebels figured out how to milk the cow and keep fighting each other at the same time, things stabilized. The speculators are keeping the price high because there is still considerable unrest in the region. You can’t really blame them for trying. If the Saudis get overthrown, crude would shoot to over $200/barrel and retail prices would go to $10 a gallon, or the end of the world as we know it.
Higher gas prices are a tough obstacle for any economy and a big problem for this one. High gas prices act just like a tax on disposable income and really hurt lower-income people.
So what is this economy like? It’s sensitive, it’s cautious, it’s mysterious. It can be strong, it can be weak, and without warning it can be anything in between. That’s correct, this economy is a woman! This observation should be viewed as purely descriptive and is not derogatory or sexist in any way.
(Cue Billy Joel)
She can kill with a smile
She can wound with her eyes
She can ruin your faith with her casual lies
And she only reveals what she wants you to see
She hides like a child,
But she's always a woman to me
She can lead you to love
She can take you or leave you
She can ask for the truth
But she'll never believe you
And she'll take what you give her, as long as it's free
Yeah, she steals like a thief
But she's always a woman to me
You see this economy has been hurt very deeply by all the turmoil of the last few years. She has been lied to. She has been deceived. Her trust has been broken. She has been betrayed. She feels like we have been insensitive to her needs, she feels violated.
She is not really moved by some short-term, artificial, stimulus. She wants a real, long-term commitment. This relationship can be restored, but it will take time. She wants to take it slow and cautiously. She wants it to be deep, meaningful and long-lasting.
And she'll promise you more
Than the Garden of Eden
Then she'll carelessly cut you
And laugh while you're bleedin'
But she'll bring out the best
And the worst you can be
Blame it all on yourself
Cause she's always a woman to me
She is frequently kind
And she's suddenly cruel
She can do as she pleases
She's nobody's fool
And she can't be convicted
She's earned her degree
And the most she will do
Is throw shadows at you
But she's always a woman to me
We want to tell her that we really didn’t mean anything by it. That we wish that it never happened. That we need to get beyond this and just get back to the way things were before. And we promise that it will never, ever, happen again. We’re sorry baby, we are so very, very, sorry.
So what do we need to get this recovery (or to heal this relationship) to get going again? First, we need for the Middle East to stabilize. We are leaning on Khadafy like Chicago thugs (wonder where that idea came from?) and I actually think that it’s going to work. Second, we need the weather to get back to normal. Third, as the Middle East calms down, so will the speculators demand for crude oil futures. And finally, some Barry White music couldn’t hurt.
She's Always A Woman - Billy Joel
Please check out my new humor blog Next post: June 2
Tuesday, May 17, 2011
Fantasy Island Meets Reality
Back in the mid-1980’s my wife and I worked for different manufacturing companies and were covered by two full medical and dental plans. Why would we pay for two plans? That’s the point; we didn’t pay anything for either one. The costs were fully paid by the companies, our only contribution was a modest deductable.
Today, my wife and I work for two different companies and we are covered by two full medical plans and we pay a contribution for both. Why would we pay for two plans? Because Obamacare forced me off my wife’s plan when I started working again. (“First of all, if you’ve got health insurance, you like your doctors, you like your plan, you can keep your doctor, you can keep your plan. Nobody is talking about taking that away from you.” -- Barak Obama)
Yes, things have changed considerably since the 80’s. Medical costs started to rise rapidly and companies started requiring employees to contribute to the costs. Every year now your employer tells you how much medical insurance costs have increased and you find out how much more you will have to pay.
Similarly, many companies used to provide substantial pension benefits to employees. That benefit also peaked in the 80’s. Most companies started to reduce or eliminate pensions and 401-K accounts with a company contribution became the norm.
And all this is obvious to most working people, but it is a mystery to those living on Fantasy Island where medical and pension benefits remain as they were in 1980’s. While a global economy and global competition were bringing huge changes to the mainland, those on Fantasy Island remained totally separated from the outside world. It’s like every year a plane arrives on the Island with a huge shipment of medical and pension benefits for the people to enjoy. (“Look boss, da plane, da plane!)
It has now become a big issue because the benefits delivered to Fantasy Island are paid for by the people on the mainland. As previously mentioned, the people on the mainland have seen their benefits significantly reduced over the past 30 years. In addition the last three years have been financially very tough on them. Now the people on the mainland have plans to reduce the plane’s cargo.
To this the residents of Fantasy Island scream “Da Plan” Boss. Da Plan. The *$!*?#! Plan! “This reaction is very rational and is to be expected. If you lived on the island, you would respond in the same way. Things have really changed. The way the islanders see it, not only did someone move their cheese, but they are trying to shove it up their cheesehole. They argue that they deserve better benefits because living on Fantasy Island makes them special. They feel attacked, blamed, and victimized. In a way that is true. A great many people have been “attacked” and victimized by The Great Recession. Some are still hurting very much.
The people on the Island shout that it is not fair to cut their benefits. But the people paying for those benefits say it is unfair that benefits continue to grow for one class of people when many people on the mainland are dealing with reduced benefits or no benefit at all.
The people on Fantasy Island were able to obtain great benefits due to the “bosses”. These bosses don’t wear white suits like Mr. Roarke (but they do like fine, Corinthian, leather) but they are very important to the islanders. In the past, the bosses were very important to people on the mainland also. The bosses started out only on the mainland but since many people on the mainland were working for bosses, it made sense that people on Fantasy Island worked for them also. But the value and thus the importance of the bosses started to decline significantly in the 90’s. Global competition and improved work laws have now almost made the bosses obsolete on the mainland.
However the bosses on Fantasy Island were insulated from global competition and not only survived, but kept gaining power. They did this by trading political support for increased benefits for their people. They also extracted money back from the people to entrench their positions. These deals worked because they went on behind a cloak of secrecy and details were rarely communicated to the people on the mainland. But now at this critical juncture, many people are questioning the level of benefits and the details are being brought to public scrutiny. (See links below)
Now the people on Fantasy Island are being forced to literally deal with reality. It is not 1980 anymore. They want to continue living in the past. It is ironic that to protest the attempt to rein in benefits, that some islanders resorted to a “sit-in” a common tactic in the 1960’s. Sit-ins may have been effective then, but have been largely abandoned due to the new technology of the TASER gun. The TASER was not used in this instance due to the expected public outcry if police would have tasered dozens of protesters. However police would have only had to taser one person to disperse the crowd provided that person screamed really loud. Selecting the person in our politically-correct culture would have been tricky, so look out skinny white guy they’re coming after you. (Take that nasty TASER white boy, take that nasty TASER right).
Therefore the main opponent of the Fantasy Islanders is not any politician, nor any political party or organization. Their opponent is Reality. And Reality is tough fighter. If you are not ready, it will slap you silly. It will blindside you and drive you face first into the ground. You can’t fight Reality head on, you can only try to respond and adapt to it.
You never got to see what happened on the television show Fantasy Island the next week after the people returned to reality. That’s because it probably wasn’t very pretty. This won’t be either.
Reality Article #1 Reality Article #2
Play That Funky Music!
Today, my wife and I work for two different companies and we are covered by two full medical plans and we pay a contribution for both. Why would we pay for two plans? Because Obamacare forced me off my wife’s plan when I started working again. (“First of all, if you’ve got health insurance, you like your doctors, you like your plan, you can keep your doctor, you can keep your plan. Nobody is talking about taking that away from you.” -- Barak Obama)
Yes, things have changed considerably since the 80’s. Medical costs started to rise rapidly and companies started requiring employees to contribute to the costs. Every year now your employer tells you how much medical insurance costs have increased and you find out how much more you will have to pay.
Similarly, many companies used to provide substantial pension benefits to employees. That benefit also peaked in the 80’s. Most companies started to reduce or eliminate pensions and 401-K accounts with a company contribution became the norm.
And all this is obvious to most working people, but it is a mystery to those living on Fantasy Island where medical and pension benefits remain as they were in 1980’s. While a global economy and global competition were bringing huge changes to the mainland, those on Fantasy Island remained totally separated from the outside world. It’s like every year a plane arrives on the Island with a huge shipment of medical and pension benefits for the people to enjoy. (“Look boss, da plane, da plane!)
It has now become a big issue because the benefits delivered to Fantasy Island are paid for by the people on the mainland. As previously mentioned, the people on the mainland have seen their benefits significantly reduced over the past 30 years. In addition the last three years have been financially very tough on them. Now the people on the mainland have plans to reduce the plane’s cargo.
To this the residents of Fantasy Island scream “Da Plan” Boss. Da Plan. The *$!*?#! Plan! “This reaction is very rational and is to be expected. If you lived on the island, you would respond in the same way. Things have really changed. The way the islanders see it, not only did someone move their cheese, but they are trying to shove it up their cheesehole. They argue that they deserve better benefits because living on Fantasy Island makes them special. They feel attacked, blamed, and victimized. In a way that is true. A great many people have been “attacked” and victimized by The Great Recession. Some are still hurting very much.
The people on the Island shout that it is not fair to cut their benefits. But the people paying for those benefits say it is unfair that benefits continue to grow for one class of people when many people on the mainland are dealing with reduced benefits or no benefit at all.
The people on Fantasy Island were able to obtain great benefits due to the “bosses”. These bosses don’t wear white suits like Mr. Roarke (but they do like fine, Corinthian, leather) but they are very important to the islanders. In the past, the bosses were very important to people on the mainland also. The bosses started out only on the mainland but since many people on the mainland were working for bosses, it made sense that people on Fantasy Island worked for them also. But the value and thus the importance of the bosses started to decline significantly in the 90’s. Global competition and improved work laws have now almost made the bosses obsolete on the mainland.
However the bosses on Fantasy Island were insulated from global competition and not only survived, but kept gaining power. They did this by trading political support for increased benefits for their people. They also extracted money back from the people to entrench their positions. These deals worked because they went on behind a cloak of secrecy and details were rarely communicated to the people on the mainland. But now at this critical juncture, many people are questioning the level of benefits and the details are being brought to public scrutiny. (See links below)
Now the people on Fantasy Island are being forced to literally deal with reality. It is not 1980 anymore. They want to continue living in the past. It is ironic that to protest the attempt to rein in benefits, that some islanders resorted to a “sit-in” a common tactic in the 1960’s. Sit-ins may have been effective then, but have been largely abandoned due to the new technology of the TASER gun. The TASER was not used in this instance due to the expected public outcry if police would have tasered dozens of protesters. However police would have only had to taser one person to disperse the crowd provided that person screamed really loud. Selecting the person in our politically-correct culture would have been tricky, so look out skinny white guy they’re coming after you. (Take that nasty TASER white boy, take that nasty TASER right).
Therefore the main opponent of the Fantasy Islanders is not any politician, nor any political party or organization. Their opponent is Reality. And Reality is tough fighter. If you are not ready, it will slap you silly. It will blindside you and drive you face first into the ground. You can’t fight Reality head on, you can only try to respond and adapt to it.
You never got to see what happened on the television show Fantasy Island the next week after the people returned to reality. That’s because it probably wasn’t very pretty. This won’t be either.
Reality Article #1 Reality Article #2
Play That Funky Music!
Wednesday, May 4, 2011
Downsized Dan’s Amazing Adventure
One man’s journey into and out of The Great Recession
Dan arrived at work on a beautiful, sunny, Friday in June 2009. He had flown back home on Thursday from a wonderful Florida vacation. He had decided to return to work on Friday so that he could copy several files that he would need to do some work at home the following week. The offices would be closed the next week due to the July 4 holiday and slow sales. Dan wondered how many employees would have cut their vacation short to do this and how many of the other employees would be doing any work the following week.
Dan had been at work about an hour when he was told by a human resources manager to report to the conference room for a meeting. He knew what was going to happen. The company had been hit very hard by the recession. Sales had been cut in half and there had already been four layoffs, the most recent occurring that Monday when he had been in Florida. Dan had been with the company for 16 years, but that was no defense against this recession. This was not about experience, or even past value, this was about cold, hard, cash.
The two HR managers explained in frigid, sterile, terms what was happening and why. Dan pretended to listen, but he really didn’t hear very much. He was afraid to hear those final words. “We must now remove your 'bolers'.” “Oh please don’t take my bolers”, Dan pleaded. “I have worked for 16 years to grow and develop my bolers. Look how large and shiny they are.” But the HR Reps were unmoved. They then proceeded to cut Dan’s bolers off. “By the way Dan, we are sending your bolers to headquarters in Chicago. I think they are going to be mounted on the executive conference room wall!” Dan was presented with a bag of severance and directed to the exit.
Do you ever feel like a plastic bag
drifting through the wind
wanting to start again?
Do you ever feel, feel so paper thin
like a house of cards,
one blow from caving in?
So our hero Dan was thrown out of the land of Employment and into the land of Unemployment. This was a very disheartening thing. The official recession was ending, but millions of people had been cast out of Employment and more were arriving in Unemployment every day. And once you were cast out of Employment it was virtually impossible to get back in quickly. The walls of the city were made of granite and very high. You could see people running full speed into the granite wall trying to get back in. Others just pounded their fist or their head against the wall hoping it would help.
The only way to get back into Employment was to attract the attention of a “hiring nymph”. You then had to convince her that you were would a “good fit” worthy of receiving new bolers. If you were successful, you would get to mate with her and she would escort you back into the land of Employment. But there were very few hiring nymphs to be found. Many had gone to sleep due to the recession. There was great competition to attract the attention of the few nymphs looking for mates. There were almost seven residents of Unemployment for every hiring nymph. The nymphs could be very selective in choosing mates and some nymphs would not even look at you if you had no bolers.
But Dan could not even try get back into the land of Employment for a while. He was suffering intense physical and emotional pain due to the loss of his bolers. He spent some days just staring at where his bolers had been and wishing they were still there. He often thought back to when he had his bolers and how painful it was to have them chopped off.
Dan felt incomplete without his bolers. He just didn’t feel right, he didn’t look right and he didn’t walk right. He initially avoided going out into public because he thought people were staring at his lack of bolers. He lost his self-confidence and sometimes doubted his ability to ever obtain new bolers again. The strange thing was that in reality Dan was the very same person with the same skills and abilities, but he didn’t have his bolers and that left a huge void in his life.
Do you ever feel already buried deep?
6 feet under screams but no one seems to hear a thing
Do you know that there's still a chance for you
'Cause there's a spark in you
After a while Dan healed enough to go to the wall and begin trying to attract the attention of the hiring nymphs. He would yell out, “Do you have any bolers for me today?” But the effect of the recession raged on. There were no nymphs. No matter how loud or how creative you pleaded, there were no nymphs. Day after day Dan and the other people in the land of Unemployment would cry out, but there would be nothing but silence. Dan became very despondent, but he could not quit. He did not want to become like the head bangers. So he pressed on despite the utter futility of the mission.
This went on for months. Dan’s bag of severance was gone. He was tired, he was fearful; he wondered when he would ever have bolers again.
Maybe your reason why all the doors are closed
So you could open one that leads you to the perfect road
Like a lightning bolt, your heart will blow
And when it's time, you'll know
Then one day he attracted the attention of a hiring nymph. She liked what she saw and didn’t seem to care that Dan had been walking around without bolers for almost nine months. They talked, they winked, and they flirted.
Finally she said, “I want to mate with you.”
“What bolers do I get?” Dan asked.
The nymph then showed him his potential new bolers.
“They are not very big”, said Dan wearingly. “Can’t I have some larger ones please?”
“I’m afraid not, said the nymph. I know that residents of Unemployment are desperate to obtain any bolers at all, so this is all you get. Are you ready to mate?”
Dan reluctantly accepted the offer. As he approached the nymph to begin mating, she said “Great, now turn around and bend over.”
Somehow this was not the way Dan had imagined it would be. It was a classic “low-boler” offer. It is only very enjoyable for the nymph. So Dan complied and received their package and thus was granted access back into the land of Employment.
Dan did feel good to have new bolers. They obviously didn’t fit as well as his previous bolers, but they were bolers. Dan reasoned that if he worked really, really, hard, he might be able to grow these bolers to the size of his old ones, but it would take many years. So he swallowed his pride and went on with his life.
Dan had been re-bolerized for only eight months when suddenly another hiring nymph appeared. “I have been looking for someone special to mate with”, she cooed. “You have everything I am looking for and I wish to mate with you so badly.”
Dan was caught completely by surprise. He had vigorously pursued hiring nymphs while in the land of Unemployment for a long time without success. Now a nymph was pursuing him. She was very hot for him and she liked the fact that he already had bolers and really liked their shape.
But Dan was conflicted. His current nymph had mated with him when no other nymph would. She had given him his bolers back. She had made him feel somewhat whole again. How could he even think about mating with another nymph so soon?
He expressed his concerns to the new nymph.
“That’s nice”, she said. “But I really do want to mate with you. I think you can satisfy all my needs. Oh and by the way, here are your new bolers if you agree to mate with me.”
Dan’s mouth dropped open. The bolers were quite impressive. They were large and shiny. Upon closer inspection the bolers turned out to be even larger than the bolers he had originally lost. Dan had a big decision to make.
“Mate with me now!” The nymph pleaded.
“Wait, just a moment”, said Dan.
Dan had an ethical dilemma. Dan knew what he had to do. He had to consult the Book of Business Rules. Dan had lived his entire career by the book. He had consulted the book frequently and over his tenure had made some difficult decisions based on its direction. He was sure it would give him guidance now.
He hunted feverishly until he found the book. In the table of contents he found a chapter on Business Loyalty that he was sure would have the answer to his dilemma. His hands were shaking when he found the chapter and started thumbing through the pages. But to Dan’s dismay, he found that all the pages in that particular chapter had been erased. He could see where the print used to be, but in effect the pages were now blank. He knew that edits were made to the book from time to time, but he had never seen anything like this. He frantically went through the entire chapter page by page, searching for anything that might help him. But there was nothing left. He was angry at whoever had erased the pages, and then he noticed a hand written notation at the bottom of the last page. It said: “Final edit, December 2007”.
Dan recognized the date as the month the Great Recession began. He thought back to a conference room in June 2009. He remembered a cold, sterile, conversation and then he remembered having his bolers cut off after 16 years of loyal service. He concluded that it’s all about bolers man. He now knew what he had to do.
He ran to the new hiring nymph, ripped off her bodice and vigorously mated with her. After two days of continuous mating, Dan and the nymph achieved mutual orgasmic satisfaction. Now this is how Dan dreamt it would always be.
When Dan informed the other nymph what had happened, her father became furious that Dan had mated with another nymph so soon after mating with his daughter. Dan told him, that it wasn’t personal, but it was all about the bolers man. This explanation did not satisfy the dad. He came after Dan with a large pair of shears and threatened to cut off his new bolers.
Dan ran. He ran faster than he had ever run in his life. He ran so fast that suddenly his feet were not touching the ground. In fact he was no longer running but shooting up towards the sky. He then noticed that sparks were flying off his body.
“Holy Shadrach”, said Dan. “I’m on fiyar, but I’m not being burned.” Then he looked down and saw a pretty, young, woman wearing a bright, short, dress and he heard her singing:
'Cause baby you're a firework
Come on, show 'em what you're worth
Make 'em go "Ah, ah, ah"
As you shoot across the sky-y-y
Baby, you're a firework
Come on, let your colors burst
Make 'em go "Ah, ah, ah"
You're gonna leave 'em all in awe, awe, awe
Boom, boom, boom
Even brighter than the moon, moon, moon
Boom, boom, boom
Even brighter than the moon, moon, moon
Dan arrived at work on a beautiful, sunny, Friday in June 2009. He had flown back home on Thursday from a wonderful Florida vacation. He had decided to return to work on Friday so that he could copy several files that he would need to do some work at home the following week. The offices would be closed the next week due to the July 4 holiday and slow sales. Dan wondered how many employees would have cut their vacation short to do this and how many of the other employees would be doing any work the following week.
Dan had been at work about an hour when he was told by a human resources manager to report to the conference room for a meeting. He knew what was going to happen. The company had been hit very hard by the recession. Sales had been cut in half and there had already been four layoffs, the most recent occurring that Monday when he had been in Florida. Dan had been with the company for 16 years, but that was no defense against this recession. This was not about experience, or even past value, this was about cold, hard, cash.
The two HR managers explained in frigid, sterile, terms what was happening and why. Dan pretended to listen, but he really didn’t hear very much. He was afraid to hear those final words. “We must now remove your 'bolers'.” “Oh please don’t take my bolers”, Dan pleaded. “I have worked for 16 years to grow and develop my bolers. Look how large and shiny they are.” But the HR Reps were unmoved. They then proceeded to cut Dan’s bolers off. “By the way Dan, we are sending your bolers to headquarters in Chicago. I think they are going to be mounted on the executive conference room wall!” Dan was presented with a bag of severance and directed to the exit.
Do you ever feel like a plastic bag
drifting through the wind
wanting to start again?
Do you ever feel, feel so paper thin
like a house of cards,
one blow from caving in?
So our hero Dan was thrown out of the land of Employment and into the land of Unemployment. This was a very disheartening thing. The official recession was ending, but millions of people had been cast out of Employment and more were arriving in Unemployment every day. And once you were cast out of Employment it was virtually impossible to get back in quickly. The walls of the city were made of granite and very high. You could see people running full speed into the granite wall trying to get back in. Others just pounded their fist or their head against the wall hoping it would help.
The only way to get back into Employment was to attract the attention of a “hiring nymph”. You then had to convince her that you were would a “good fit” worthy of receiving new bolers. If you were successful, you would get to mate with her and she would escort you back into the land of Employment. But there were very few hiring nymphs to be found. Many had gone to sleep due to the recession. There was great competition to attract the attention of the few nymphs looking for mates. There were almost seven residents of Unemployment for every hiring nymph. The nymphs could be very selective in choosing mates and some nymphs would not even look at you if you had no bolers.
But Dan could not even try get back into the land of Employment for a while. He was suffering intense physical and emotional pain due to the loss of his bolers. He spent some days just staring at where his bolers had been and wishing they were still there. He often thought back to when he had his bolers and how painful it was to have them chopped off.
Dan felt incomplete without his bolers. He just didn’t feel right, he didn’t look right and he didn’t walk right. He initially avoided going out into public because he thought people were staring at his lack of bolers. He lost his self-confidence and sometimes doubted his ability to ever obtain new bolers again. The strange thing was that in reality Dan was the very same person with the same skills and abilities, but he didn’t have his bolers and that left a huge void in his life.
Do you ever feel already buried deep?
6 feet under screams but no one seems to hear a thing
Do you know that there's still a chance for you
'Cause there's a spark in you
After a while Dan healed enough to go to the wall and begin trying to attract the attention of the hiring nymphs. He would yell out, “Do you have any bolers for me today?” But the effect of the recession raged on. There were no nymphs. No matter how loud or how creative you pleaded, there were no nymphs. Day after day Dan and the other people in the land of Unemployment would cry out, but there would be nothing but silence. Dan became very despondent, but he could not quit. He did not want to become like the head bangers. So he pressed on despite the utter futility of the mission.
This went on for months. Dan’s bag of severance was gone. He was tired, he was fearful; he wondered when he would ever have bolers again.
Maybe your reason why all the doors are closed
So you could open one that leads you to the perfect road
Like a lightning bolt, your heart will blow
And when it's time, you'll know
Then one day he attracted the attention of a hiring nymph. She liked what she saw and didn’t seem to care that Dan had been walking around without bolers for almost nine months. They talked, they winked, and they flirted.
Finally she said, “I want to mate with you.”
“What bolers do I get?” Dan asked.
The nymph then showed him his potential new bolers.
“They are not very big”, said Dan wearingly. “Can’t I have some larger ones please?”
“I’m afraid not, said the nymph. I know that residents of Unemployment are desperate to obtain any bolers at all, so this is all you get. Are you ready to mate?”
Dan reluctantly accepted the offer. As he approached the nymph to begin mating, she said “Great, now turn around and bend over.”
Somehow this was not the way Dan had imagined it would be. It was a classic “low-boler” offer. It is only very enjoyable for the nymph. So Dan complied and received their package and thus was granted access back into the land of Employment.
Dan did feel good to have new bolers. They obviously didn’t fit as well as his previous bolers, but they were bolers. Dan reasoned that if he worked really, really, hard, he might be able to grow these bolers to the size of his old ones, but it would take many years. So he swallowed his pride and went on with his life.
Dan had been re-bolerized for only eight months when suddenly another hiring nymph appeared. “I have been looking for someone special to mate with”, she cooed. “You have everything I am looking for and I wish to mate with you so badly.”
Dan was caught completely by surprise. He had vigorously pursued hiring nymphs while in the land of Unemployment for a long time without success. Now a nymph was pursuing him. She was very hot for him and she liked the fact that he already had bolers and really liked their shape.
But Dan was conflicted. His current nymph had mated with him when no other nymph would. She had given him his bolers back. She had made him feel somewhat whole again. How could he even think about mating with another nymph so soon?
He expressed his concerns to the new nymph.
“That’s nice”, she said. “But I really do want to mate with you. I think you can satisfy all my needs. Oh and by the way, here are your new bolers if you agree to mate with me.”
Dan’s mouth dropped open. The bolers were quite impressive. They were large and shiny. Upon closer inspection the bolers turned out to be even larger than the bolers he had originally lost. Dan had a big decision to make.
“Mate with me now!” The nymph pleaded.
“Wait, just a moment”, said Dan.
Dan had an ethical dilemma. Dan knew what he had to do. He had to consult the Book of Business Rules. Dan had lived his entire career by the book. He had consulted the book frequently and over his tenure had made some difficult decisions based on its direction. He was sure it would give him guidance now.
He hunted feverishly until he found the book. In the table of contents he found a chapter on Business Loyalty that he was sure would have the answer to his dilemma. His hands were shaking when he found the chapter and started thumbing through the pages. But to Dan’s dismay, he found that all the pages in that particular chapter had been erased. He could see where the print used to be, but in effect the pages were now blank. He knew that edits were made to the book from time to time, but he had never seen anything like this. He frantically went through the entire chapter page by page, searching for anything that might help him. But there was nothing left. He was angry at whoever had erased the pages, and then he noticed a hand written notation at the bottom of the last page. It said: “Final edit, December 2007”.
Dan recognized the date as the month the Great Recession began. He thought back to a conference room in June 2009. He remembered a cold, sterile, conversation and then he remembered having his bolers cut off after 16 years of loyal service. He concluded that it’s all about bolers man. He now knew what he had to do.
He ran to the new hiring nymph, ripped off her bodice and vigorously mated with her. After two days of continuous mating, Dan and the nymph achieved mutual orgasmic satisfaction. Now this is how Dan dreamt it would always be.
When Dan informed the other nymph what had happened, her father became furious that Dan had mated with another nymph so soon after mating with his daughter. Dan told him, that it wasn’t personal, but it was all about the bolers man. This explanation did not satisfy the dad. He came after Dan with a large pair of shears and threatened to cut off his new bolers.
Dan ran. He ran faster than he had ever run in his life. He ran so fast that suddenly his feet were not touching the ground. In fact he was no longer running but shooting up towards the sky. He then noticed that sparks were flying off his body.
“Holy Shadrach”, said Dan. “I’m on fiyar, but I’m not being burned.” Then he looked down and saw a pretty, young, woman wearing a bright, short, dress and he heard her singing:
'Cause baby you're a firework
Come on, show 'em what you're worth
Make 'em go "Ah, ah, ah"
As you shoot across the sky-y-y
Baby, you're a firework
Come on, let your colors burst
Make 'em go "Ah, ah, ah"
You're gonna leave 'em all in awe, awe, awe
Boom, boom, boom
Even brighter than the moon, moon, moon
Boom, boom, boom
Even brighter than the moon, moon, moon
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