Letter Never Sent

Since I’ve been back in San Antonio for about three weeks, I’ve gotten to know the surrounding restaurants very well. Too well. In between visiting hours, I normally walk across the street to Chik-fil-A, so I don’t have to pay twice for parking. As far as fast food goes, Chik-fil-A is top of the heap. You can actually tell what kind of animal the sandwich came from. They also do things a little differently:

1. The employees at Chik-fil-A always say “My pleasure” when I say, “Thank you”. Even if it is part of some cynical marketing ploy, I like it.
2. There are fresh flowers on each table. The other day they were yellow daisy-like flowers. Today they were purple daisy-like flowers.
3. Little Texas Pete hot sauce packets! I am all for condiment selection. Hot sauce is essential. (Don’t miss the Texas Pete Wikipedia article wherein someone gets a little free with the truth: “In late 2003, Chick-Fil-A opted to carry Texas Pete sauce (packet-form) in its restaurants nationwide. Same-store sales catapulted over 45% in 2004. Many analysts close to the firm heralded the decision to carry the sauce, largely attributing the company’s success to the sauce itself. In several third party surveys, Chick-Fil-A customers have exclaimed, “Texas Pete doesn’t go on the chicken sandwich, the chicken sandwich goes on the Texas Pete,” and “Best thing since the chicken sandwich.”)
4. They play Christian music as background music. I don’t really have a problem with this except it’s generally bland and I don’t know any of the songs. That’s okay. Background music is not supposed to be good.
5. Real lemonade. Tart and sweet. ‘Nuff said.
6. At the entrance to the playscape, they provide the kids with little alcohol towelettes so they can clean their grubby hands.

Every year I get a green, printed Social Security statement in the mail from the federal government. It lists my taxable income for every year I’ve paid taxes. Looking at past earnings is a trip down memory lane. The first jobs at 16, the lean college years, the post college flailing about… my life story in numbers, faithfully recorded by the Social Security Administration.

• It would be useful to take this information and chart your earnings over time to see the trend. I would imagine that if you did this over your expected lifetime you would observe a bell-like curve. From no earnings in youth to a considerable increase then a slowed growth, then inevitably a decline as you approach old age. (I could be wrong here. How would you continue increases in income growth? Invest an inordinate amount when young?)
• You could also calculate your year over year percentage income growth to keep your career earnings on track. For example, if you experienced 15% in annual growth for several years and then observed a decrease in growth or even negative growth you might consider retooling your skillset or looking for other income growth opportunities in order to maintain your growth trajectory. Income growth is essential in asset growth, though you will have no asset growth if you spend everything you earn.
• It might also be a good idea to keep an eye on average annual income growth on a five year trend. The last five years are probably a better guide to your income growth than what you earned at 16.

One of my passions is personal finance, not because I’m into numbers or because I love money or luxury (I don’t.), but because controlling your money is the only way to maintain your freedom and independence. As soon as you are beholden to someone for your rent, for your car payment, for whatever… you have given up some measure of your independence. Sure, theoretically you could dumpster dive and live off the grid, but if you enjoy indoor plumbing and fresh meals, you’ll have to compromise and participate in this system to some degree and this means selling your time and energy either directly through a business or indirectly via an employer.

So, to the degree that I hold this viewpoint close to my heart, it kills me to see people struggling under mountains of debt and financial obligations. In other words, in dire straits. I don’t want to paint the credit industry as evil, but I do think we have an obligation to help our fellow man make responsible financial decisions, especially when we see them perched on the edge. It is wrong to knowingly prey upon the ignorant, to award credit to those least able to deal with it. Let’s be honest, the credit industry is in the business of waiting for you to slip up. They don’t make money on people who pay their bills on time. Think about that.

Anyway, J. told me about this good documentary, Maxed Out, and I found it on Google Video in case you wanted to watch it. It made me angry enough to write this, so that’s an endorsement of sorts.

If I could offer any financial advice, it would be this:

1. Pay off your credit card balance every month, even if it hurts and you have to eat baloney sandwiches every day for several weeks.
2. Get a high-yield savings account (Like ING Direct) and set an automatic transfer from your checking to your savings account every time you get paid. Eventually, you will build up a cushion. It’s easier than you think.
3. Never buy things on credit unless you have a lot of money in the bank. Obviously, you will know if you have the discipline to ignore this one, but it’s a good general rule.
4. Spend time with people who are good with money and avoid people who are bad with money. It sounds harsh, but both good and bad habits are contagious.

Any other tips?

As I related in the previous entry, I spent some time at the library reading. Most notably: A Perfect Mess. The basic premise of the book is that a certain amount of disorganization is actually adaptive, efficient and beneficial. And, organizing may actually be counter-productive in terms of the energy required to stay organized. What a relief this is for disorganized people. I have noticed that it takes a lot of energy to keep things neat when it would actually be better to just accept a nominal amount of disorder so you can focus on more important things.

I took a few notes you might find interesting:

1. “Office messiness tends to increase sharply with increasing education, increasing salary, and increasing experience.”
2. On the questionable value of Jack Welch-ian strategic planning: “Managers import a raft of poor assumptions into the planning process…” Which results in useless or unfounded ‘planning’.
3. On comfort noise: Telephone engineers actually add a certain amount of background noise to telephone and especially cellphone conversations because people find total silence in conversation unnatural and confusing. Users hate the complete absence of background noise. “Adding background noise to telephone calls signifies presence.” Read more about ITU recommendation G.711.II.
4. On randomness and noise as a fundamental concept of existence. Example Brownian motion.
5. “Disorder creates connections.” Mess-driven invention.
6. Rather than focus on terrorist leaders, FBI / CIA focus on the productive nodes: “In a disorganized network the nodes in the middle carry the greatest workload.”
7. The cost of neatness: “Being neat requires constant expenditure of resources.”
8. Robustness of disorder: “Messy systems are more resistant.” Loosely woven.
9. The popular Noguchi file system is simply a pile shifted on its side. More frequently used items work their way to the front, just as in a pile. In other words, piles are intuitive expressions of higher order.
10. Messy environments provide useful cues.

I love the trend toward eradicating “business dress” in the workplace. Is it really so bad to see everyone at work in t-shirts and flipflops? Casual dress in the workplace signals freedom and organizational confidence and acts as a cheap benefit to the employees. Casual dress should really be called personal address since it means you can wear almost anything you please.

When the “boss” looks the same as everyone else it strengthens team unity and openness, even if, in reality, the ultimate authority is clear. The suit is becoming the symbol of the salesman. The smirking slave collar of the old corporate world. It represents the triumph of ostentation over substance, appearance over reality, marketing showmanship over solid product development.

When you dress casual, you cannot rely on the impact of your wardrobe. Your ideas and work must speak for you. When you dress casual you cannot hide your humble human qualities, like the slope of your shoulders or your out-of-shape body. For better or worse, you are what you are.

On the flip side, it’s hilarious to see formerly suited types desperately following current fashions. In a recent issue of Business Week, there was an article featuring some ridiculous venture capitalist dressed-down in two-hundred dollar jeans, an untucked club shirt, and expensive slip-on loafers that try to look both expensive and shabby at the same time. It just seemed so over-thought and self-conscious, which is the opposite of the casual dress approach.

If you work face to face with customers, a case might be made for looking a certain way. However, I’m sure we’ve all seen examples of how corporate uniforms are subverted with tokens of individuality like buttons, wallet chains, watches, tattoos, or strange hair configurations. In some ways, the bleeding through of the individual makes the corporate uniform even more ridiculous and belies the controlling need to systemize everything down to the most inconsequential detail. That too seems desperate and self-conscious.

In requiring stringent dress codes, we ask employees to cede personal freedom to their employers, so great care should be taken when dictating appearances.

In the end, the corporate need for systems and the growing individuality of culture will harmonize. Workers will gradually take on more responsibility for their incomes and lives until we approach a Free Agent World and employers will adopt more casual relationships, which may lead to true partnership between employees and management.

If you enjoy old books, as I do, you are familiar with the concept of reading in translation. Unless you absolutely must read a work in its original form and are willing to learn a new language to do so, it is the easiest way to absorb the information. Let’s say you want to read something originally written in French from the 17th century. You would most likely purchase an English translation of the text to do so. This is obviously a boon to readers. However, it is interesting to note the regularity with which new translations of public domain books are released. The accepted dogma about new translations is that they are an improvement upon past translations due to an improved understanding of the context, the discovery of new information, etc. I think a more mundane explanation is responsible for most new translations: easy money.

Think about it. In 500 years of publishing, there are thousands of volumes of old works available for anyone to republish without royalties to the original author. However, if you were to just republish a work, you would have nothing you could copyright. So, how do you make money off something a dead guy has already written? Simple. You commission a professor in French literature to create an entirely new translation from the original source. The translation does not have to be better than any past translation, in fact many new translations are worse than past translations. The new translation has just one requirement: it has to be something you can copyright, own, and sell to retailers. That’s why we see several translations of the same books. With a popular enough book, every publisher could commission their own new translation and copyright it. With books that do not need translating a similar practice is in effect. To copyright a new edition of a public domain book, simply commission an expert in the material to write a new introduction and afterword. Slap on the new material and you now have an edition of a public domain work you can copyright.

While none of this is wrong, it is annoying. On the plus side, consumers have continued to have access to older works. On the minus side, we keep having to pay the going rate for a book that has been in circulation for hundreds or thousands of years (in the case of Plato, for example). This is one reason why I love projects like Wikipedia and, especially, Google Books. With Google Books, you can find the public domain equivalents of older works and you can read them in their entirety online or download them to your computer. This is awesome.

For example, instead of having to buy one of my favorite books of practical philosophy, The Art of Worldly Wisdom by Baltasar Gracián y Morales. You can now just the entire thing in an older, public domain translation from 1892.

XI. Cultivate those who can teach you. Let friendly intercourse be a school of knowledge, and culture be taught through conversation thus you make your friends your teachers and mingle the pleasures of conversation with the advantages of instruction. Sensible persons thus enjoy alternating pleasures: they reap applause for what they say, and gain instruction from what they hear. We are always attracted to others by our own interest, but in this case it is of a higher kind. Wise men frequent the houses of great noblemen not because they are temples of vanity, but as theatres of good breeding. There be gentlemen who have the credit of worldly wisdom, because they are not only themselves oracles of all nobleness by their example and their behaviour but those who surround them form a well-bred academy of worldly wisdom of the best and noblest kind The Art of Worldly Wisdom By Baltasar Gracián y Morales, Joseph Jacobs

I’ve always enjoyed going to used book stores. Back in San Antonio where I grew up there was a Half Price Books on Broadway that was built into an old two-story house. With every wall covered in shelves, the hallways and rooms were a tight fit to go in and out of. It was the perfect shopping experience for a teenage reader: row upon row of musty paperbacks piled to the ceiling; creaking floorboards and hidden treasure for pennies.

Fast forward fifteen years. I still love books, but the world has changed. These days, professional eBayers pounce on rare treasures they can sell at auction to the world, which removes some of the treasure hunting aspect, and many specialty book sellers have closed shop and now sell almost exclusively online.

None of these reasons are why I stopped shopping at my once beloved used bookstores. I had to be pushed, kicking and screaming, into buying books online for one reason: I could never find what I was looking for. I didn’t know if what I wanted was in the store somewhere or not and I found this completely frustrating. Just tell me if you have it or not. Please.

Any book published in the last thirty years has either an ISBN number, a UPC barcode, or both. If used bookstores tracked their inventory it wouldn’t just please their customers (me). They could also then start offering books online, track what’s selling well, see which stores have the worst theft, and use this data to discover all sorts of other interesting information.

I shop on Amazon, for now. But, if I can search my local used book store for a book I want, I will gladly return to your musty stacks.

No one likes to make coffee in our office and I think I know why. Today I set the coffee maker to brew enough for ten cups. I go back ten minutes later to get a cup and there’s one cup left. If there are 6-7 people who regularly drink coffee and each of them knows that someone will eventually blink and make coffee, the ideal strategy is to wait. In most situations in life, the person who acts first benefits first, but not so in the world of office coffee. The person who starts the coffee is guaranteed nothing. So, if you’re a coffee drinker and you’re running your life in the most efficient way possible, you will get your coffee at the optimal time, later in the morning, when it is most likely that someone will have given in.

The Blackberry is the best smartphone currently available. Period. If you’ve ever used a Treo, Motorola Q, and a Blackberry, you know this. There’s no point in even debating it. That being said, there are a few things that have been missing from the Blackberry that everyone else has, like a built-in camera, for example. There’s a reason for this, however. Since Blackberry is the dominant platform among big business and government they’ve been reluctant to include anything that could compromise security or even create this perception…like a built-in camera or removable storage.

One of the biggest selling points for the Blackberry is that it’s an integrated hardware-software solution. In other words, Research in Motion develops both the hardware and the software, rather than just making the device you could run Windows Mobile on a la the Motorola Q. This makes the Blackberry very stable and usable. Another cool thing about the Blackberry from the standpoint of large organizations is that they can be remotely wiped (like if you lost it) and each functional piece of the device can be locked down by the admin. In some organizations, you might disable web browsing or copy/pasting, for example. Even though each piece can be locked down, Blackberry couldn’t just release an enterprise-level version that came ONLY with a camera as they did with the prosumer-targeted Pearl. This could potentially alienate large, security-conscious customers who want mobile email, but don’t want anyone taking photos and leaking stuff they shouldn’t. So, with the Blackberry 8800 slated for Spring 2007 release they came up with the perfect solution: make two models of the same device. One with a camera, one without. Genius!

This makes me very glad since I want both a camera and the full-qwerty keyboard available on the 8800. And as someone who owns a few shares of RIMM, I also don’t want them to drive off large government contracts.

As an aside, I have to say that RIMM’s management has really been doing a great job. They’re crushing the competition and releasing great products.

It seems like most Americans are ill-equipped to deal with the vagaries of real estate. This does not bode well considering the high cost of an investment that can run several hundred thousands of dollars. From the NY Times: It Seemed Like a Good Bet at the Time:

One such owner, who requested anonymity rather than risk the embarrassment of exposing a financial blunder, bought a house in Port St. Lucie, Fla., as an investment in April of last year and financed the $410,000 purchase with an ARM, with an introductory rate of nearly 7 percent. The loan was an afterthought, since he expected to sell the house almost immediately for a profit. He didn’t, and now the developer recently sold a similar house in the neighborhood for $325,000.

“I just didn’t know what I was doing, and I shouldn’t have done it,” said the man, who does not have enough equity in the house to refinance and who will run out of money to pay the mortgage in 10 months. “Maybe the Lord will send a miracle.”

Presumably, the best time to buy real estate is when everyone else is losing their shirts, not when everyone is talking about all the quick money to be had. With houses as with stocks, buy when everyone else is selling, sell when everyone else is buying.