The World, The Flesh, and The Devil

From all inordinate and sinful affections; and from all the deceits of the world, the flesh, and the devil,
Good Lord, deliver us.
Book of Common Prayer

This morning, I was reminded by Tim Keller that we Christians are facing a three man tag team, the world, the flesh, and the devil. While fighting one of these opponents, don’t forget there are two more standing outside the ring ropes just waiting for the moment when the referee turns his back.

The world contains all sorts of temptations. Advertisers make certain that we know that the world is filled with really cool, sexy looking people enjoying every good thing that life has to offer.

“Here, try one of these, little girl. They will not harm you.”

Then our flesh kicks in. We want to be one of those cool people. The lust of the flesh, the lust of the eyes, and the boastful pride of life are a part of all us, a part of being human. No matter how “spiritual,” we want that luxury vacation to Europe. We want a diamond tennis bracelet that costs more than a new car. We want the job that comes with the corner office on the top floor of the headquarters building. We want to have sex with somebody who looks like ……? Go ahead, be honest and fill in the blank. I’ll never tell.

Yesterday, I received a copy of APEX magazine, a publication sent to select owners of Acura automobiles. They use to distribute a less prestigious looking version of this magazine. I really enjoyed it. They published the facts and figures on all their new cars, along with articles showing attractive sophisticated people driving Acuras on various adventures to an assortment of fashionable events held at exceptionally luxurious venues. They also advertized other products, like really expensive watches, that I found highly desirable. When I stopped receiving the magazine, I called up the company to ask what happened. They told me they planned to relaunch a new version the magazine next year as an electronic publication. However, when I discovered a few print copies would be available, I asked to be added to the list.

The premiere edition of APEX features the new 2017 Acura NSX, a 573 horsepower, $170,000 technological tour de force that hits all my happy buttons. As a mechanical engineer who loves super-cars, sports cars, and luxury cars, the lust of the eyes and the boastful pride of life are jumping up and down with glee. Since the primary purpose of this publication is to impress the reader with the uncompromising excellence that goes into every aspect of the design and construction of Acura products, there aren’t any glossy photographs of supermodels caressing super-cars, so the lust of the flesh had to take a back seat (except there isn’t a back seat in a NSX).

Oh, well.

What works on you? We are warned to be in the world but not of it. Do you ever covet your neighbor’s car, his house, his wife, his TV?

Just asking.

The flesh is still hard at work, even in elderly men suffering from Alzheimer’s. I watched a number of them enjoying a movie from their middle years featuring a young Marilyn Monroe. I have never seen so many of these patients focusing so intently on anything for such a long period of time.

Then the Devil, the accuser of the brethren, jumps over the ring rope and opens with, “And you call yourself a Christian?”

1st John Chapter 2: 15-17

Do not love the world nor the things in the world. If anyone loves the world, the love of the Father is not in him.
For all that is in the world, the lust of the flesh and the lust of the eyes and the boastful pride of life, is not from the Father, but is from the world.
The world is passing away, and also its lusts; but the one who does the will of God lives forever.

Time Goes Marching On

“Time goes marching on,
Pretty soon I’ll be gone,
To work again.”
Dr. John the Night Tripper

At least I think that’s what Dr. John is telling me, his Louisiana Voodoo funk delivery can be a little difficult to understand. Your relationship to money and time will largely determine the outcome of your life in this material world. It will also contribute a legacy, for better or for worse, to your children and their relationship with money.

If you misuse debt, if you don’t plan and prepare for a career with a future, if you never learn how to defer gratification, your fiscal time frame is too short. You are setting yourself up for poverty. The most extreme example of this kind of behavior that can be found in our culture is exhibited by drug addicts. Their relationship with money and time is, how long will it take to get enough money for the next fix? A more common illustration can be found in families that live pay check to pay check. Whether they are a two income family living in a McMansion and driving leased BMWs or a single mom trying to make ends meet with two part time jobs, they are not making decisions that will lead to the creation of wealth over time. When I worked in factories, many of my coworkers would spend extravagantly in the first few days after they received their weekly paycheck, then try to live on just about nothing for the rest of the week. Some of the younger, single men would only work enough to cover their car payment and bar tabs, then if they were on piecework they would slack off or in some cases disappear completely for a few days.

The middle class, as defined by net worth, does a little better. Instead of just looking for work, they had a plan. Perhaps they learned a trade. Perhaps they earned a degree with a realistic career track without taking on too much student debt. They are accumulating a few assets. Unfortunately, most of these assets, such as a house and cars consume rather than create a stream of income. Their time frame is month to month. Their measure of success is keeping ahead of the monthly payments. They have some money in the bank. Perhaps they are even putting something into a 401(k). If the economy is booming, they feel good enough to take out a second mortgage to buy a new SUV or take the family on a luxury vacation. After all, they work hard. They deserve it. If they are lucky they will work to age 65 (or later), pay off most of their debts, sell the big house, and live on Social Security, their 401(k), and the proceeds from the sale of their house in an area with a low cost of living.

The rich are different. Even if they are broke, they are focused on accumulating wealth. As they watch their net worth grow, they are planning on where they want to be next year and how they intend to get there. When young, they understand that a college education is a financial investment in the future, not just an opportunity to enjoy maximum freedom with minimum responsibility. Not only do they understand those are four irreplaceable years of their life, but in additional they understand the concept of opportunity cost. Not only are they paying for tuition, room and board, student fees, and books, but they are not earning money that could be coming from their job or starting a company. These are the people who understand that compound interest can work for you—or against you. They avoid debt like the plague. These are the people who are turning run down houses into rental properties or are studying the stock market, looking for opportunities. They understand that their decisions in the present moment will become their future.

Finally, consider the very rich. Steve Wynn dropped out of law school to take over the family bingo parlor in Maryland when his father died. The old man left him with $350,000 in gambling debts. Not an auspicious beginning for the King of Las Vegas. Even as a young, broke, businessman Wynn was on the lookout for investment opportunities. He was also trying to meet bankers who could help him reach his dreams. One of these men turned down the opportunity to become a part of Wynn’s first discovery. However, he was impressed enough with the young man to sell him a 3% or 4% stake in a bankrupt rundown gambling hall in Las Vegas at bargain price. The banker wanted Wynn watching over his property in that far away city. The rest, as they say, is history. Wynn proved a consistent winner who blessed his partners with unheard of returns on their investments in his properties. Today, with a net worth of $2.7 billion, Steve Wynn is still looking into the future. His latest project is a hotel casino in the Commonwealth of Massachusetts. His goals are to help make Boston a world class destination city and, through tourism, create jobs and build up tax revenue for his host state and local governments as he has done in Las Vegas and Macau. His mind is constantly looking into a future that will not take shape in the material world for years, perhaps decades, but when you hear Wynn describe the lobby of a hotel that isn’t even yet in the design phase, it is as real to him as if he was giving a guided tour to a celebrity customer.

Think Different!

Lately, I have watched a few Youtube videos in the Top Ten Rules for Success series. The creator of these films patches together clips from various sources that illustrate why he believes the subject of his effort is successful. What is interesting to me is the diversity of the people he chooses to study. Everyone from Will Smith to Warren Buffett comes under his microscope.

There is considerable overlap on these lists. For example, work ethic appears again and again. Will Smith stated that he can’t control how much talent he has been given, but he assures the interviewer that no one will ever outwork him. He observes, “If you get on a treadmill and I get on a treadmill at the same time, one of two things will happen. Either you will get off first, or I will die.” Jackie Chan, the martial arts film star, talks about filming all day, then practicing the next day’s scenes until 2:00 AM. He gets up at 6:00 to be certain he will be fully prepared and ready to go when the cameras start to roll. In the interview, he smiles when he observes that then everyone tells him that he is lucky to be so talented.

It is interesting how many of the subjects of these videos, “aren’t in it for the money.” Donald Trump states he really doesn’t care about money. He just views it as a way to keep score. When he talks about the thrill of putting together some enormous deal and the ego rush that happens when he hits it big, I really believe that to the Donald, money is all about bragging rights, not an end in itself. The same words came from Steve Jobs. During his mid-twenties he went from a net worth of $1 million, to a net worth of $10 million, to a net worth of $100 million over the course of a few years. When he commented, Don’t get me wrong, money is useful for funding things like long range projects that can’t fund themselves, but it isn’t why I do this, I believe him.

T. Harv Eker, author of The Millionaire Mind is a journalist who has studied the common traits of successful people. He notes, “Rich people believe, I create my life, while average people think, life happens to me.” This also appears over and over again in the Top Ten series. Successful people take 100% responsibility for the outcome of their life even in the face of failures that were not their fault. Good grief, Steve Jobs was fired by the company he created. For a businessman, it doesn’t get much worse than that. Before returning to Apple, Jobs started NeXT, a computer company that created advanced computers for business, education, and graphic applications. During these years, he also started Pixar, a company that revolutionized the use of computer graphics in the film industry. Apple needed the NeXT operating system for their NeXT product, so they bought the company and let Jobs return to his position as CEO.

All these people play to win, especially the sports and martial arts stars who are featured in these videos. Failure is not an option. All though the subject was a movie, Chuck Norris recalls the intensity of Bruce Lee’s competitive spirit. At the time, Norris was the professional middle weight karate champion of the world. He lost a number of fights before holding that title for six consecutive years. Bruce Lee and Chuck Norris were friends who had practiced together for several years before Lee returned to China to start his film career. Lee asked Norris to participate in the final fight scene of his new movie.

Norris asked, “Do I get to win?”

A bit annoyed, Bruce replied, “No. I’m the star of the film.”

Norris laughed, “Oh I see, you want to beat the world’s champion.”

Bruce Lee answered in an icy, serious tone, “No. I want to kill the world’s champion.” The final fight in The Way of the Dragon, filmed in the Coliseum in Rome, remains a gold standard kung fu combat scene more than forty years after its filming.

One more question to ask yourself: Who is a part of your life? Steve Jobs was friends with the founder and CEO of Nike. Donald Trump and the activist investor, Carl Icahn are buddies. Chuck Norris and Bruce Lee were friends and sparing partners. Eker writes, “They see other successful people as models to learn from. They say to themselves, “If they can do it, I can do it.”

Jim Rohn is famous for stating that “You are the average of the five people you spend the most time with.” If you want to be a better Christian, hang out with Christians who are further up the ladder than you. If you want to be rich, find people who are rich. Ask them how they did it. Learn from wiser and more successful people. It is easier than making your own mistakes.

Now, “Think Different!”

Woulda, Shoulda, Coulda

There is a commodity that you are given every day that is more precious than money, your time. Donald Trump, Hillary Clinton, Warren Buffett, and Cam Newton, just like you, has 24 hours in a day. No more. No less. What we choose to do with that time, moment by moment, day by day, year by year, ultimately turns into the life we have lived—or wasted.

Just like your check register and your credit card statement, how you choose to spend your time tells me who you are. What kind of life do you want to live? What is important to you? Who do you want to be the moment you step off into eternity? Keep a record of how you spent your time for a day or two. Go ahead, write it down. Categorize it. How much of what you are doing is driven by who you are or who you want to become? How much could you have done that you didn’t do? What would you have done, if only? At the end of the day, do you have any regrets? What should you have done?

Consider: This morning I woke up at 5:30. I didn’t get to sleep until nearly midnight. This is an unusual occurrence in retirement. Normally, I get about nine hours of sleep. Last night I attended a meeting of the church’s writers group, a place where I am learning how to improve what I write from people who are really good. Some of them are published authors. This year I signed on to participate in a men’s Bible study that takes place on Thursday mornings at 7:00 AM. Usually this is not a problem because I get up at 5:30. This morning I really didn’t want to go, but I did. Something inside of me was telling my recalcitrant body that I had made a commitment and that barring illness or some serious problem, I belonged in that Bible study. After 47 years of “showing up” at school or work, the old fire horse answered the alarm bell one more time.

After the Bible study ended, I could have done the grocery shopping that needed to be done. I would have done it under normal circumstances, but I was tired so I blew off this chore. Of course, I thought I should have done it when I was scrounging around for something to eat in our depleted pantry a few hours later.

By the time I returned to the house, I was ready to eat some breakfast. I could have cooked up some eggs and grits. I would have done that, but I didn’t want to expend the time and effort necessary before going for my morning walk. I remembered I had a two for one coupon for smoked sausage breakfast biscuits. Yum—smoked sausage breakfast biscuits. I could have stopped after I ate one, but I didn’t. I ate them both. Junk food, like showing up is a part of who I am. After a lifetime of gobbling down fast food treats—does that make me a big pile of junk food? Hmmm. Not a pleasant thought.

Even though I was dragging, I walked my 5.25 miles. Somehow over the last three plus years, walking has become a part of who I am. It is a physical, mental, and spiritual discipline. Five or six days a week, rain or shine, I am out there hoofing it up and down the Swamp Rabbit Trail. Even when my legs and knees are telling me to cool it for a day, at this point in my life when I don’t walk I feel like something is missing.

Go ahead. If you dare, take a look at your day. What is going on in your mind and your body? How is this inner dialogue affecting what you do? Moment after moment, day after day, year after year, how have you have lived your life or how have you wasted it?

Don't Try to Outsmart the Monkey

From the Ever Unpredictable Charles Hugh Smith:

In the lunar calendar that started February 8, this is the Year of the Red Monkey. I found this description of the Red Monkey quite apt:

“According to Chinese Five Elements Horoscopes, Monkey contains Metal and Water. Metal is connected to gold. Water is connected to wisdom and danger. Therefore, we will deal with more financial events in the year of the Monkey. Monkey is a smart, naughty, wily and vigilant animal. If you want to have good return for your money investment, then you need to outsmart the Monkey. Metal is also connected to the Wind. That implies the status of events will be changing very quickly. Think twice before you leap when making changes for your finance, career, business relationship and people relationship.”

I really enjoy the Of Two Minds blog written by Charles Hugh Smith. Even when I don’t agree with the author I find his work is almost always entertaining and sometimes quite insightful. In the post quoted above Smith is predicting that we are in for a wild ride in 2016. I agree with him on that prognostication.

However, I know better than to try to outsmart the monkey.

Who is the monkey? In this case the monkey is the market, the combined noise and commotion generated by hundreds of millions of irrational pants wearing simians all jumping up and down while screeching at the top of their lungs. Everything they see and hear on the Internet causes them to react in fear or greed.

They drive the market up. They drive the market down.

They cause businesses to rise. Then they cause businesses to fail.

Imagine, thousands of monkey all trying to get to the top of the same pyramid, trampling on each other on the way up and on the way down. Big strong monkeys that make it close to the top are pulled down by younger monkeys at the very moment they are beating their chests in triumph.

There is a better way. Unless you are a King Kong willing to dedicate 16 hours a day for the rest of your life to fighting other monkeys, dinosaurs, and men in airplanes make the decision, “I don’t need the market to find financial freedom.”

Isn’t that odd advice coming from someone who considers himself an investor?

Avoid debt like the plague. Live on less than you take home each month. Save until you have a decent emergency fund. THEN begin to invest.

The best plan for the average investor is an age appropriate mix of low cost index funds. This method is termed Modern Portfolio Theory (MPF). It isn’t bulletproof. Benoit Mandelbrot, Nassim Taleb, and other authors have conclusively demonstrated that the world is a more dangerous place than is predicted by MPF, but this is a good place to start. Maintain your balance between equities and bonds, cash, and precious metal. When the stock market goes up, sell some stock. Put that money in bonds or gold shares or even the bank (not much better than hiding it under a mattress these days). When the stock market goes down, cash out those bonds and buy some shares. In the first quarter of 2009, a blind monkey could throw a dart at a list of stocks and pick a winner. Products called life cycle funds or target date funds will maintain an age appropriate balance without any effort on your part. Just keep throwing small amounts of money into this machine every month during good times and bad. If you don’t put too much money in any one thing or too much money in at any one time, the chances are pretty good that you are going to do OK.

If you like to make your own mistakes, you really can’t get yourself into too much trouble buying SMALL amounts of dividend paying stocks. Dividend Aristocrats are a good place to begin the search for these companies. If a company has a long history of paying a safe respectable dividend, you really don’t need to know a lot more information. These are perfect for a Dividend Reinvestment Program (DRIP), allowing you to reinvest your dividends in more shares. This is a free service offered by most brokers on most companies. Talk about the power of compound interest. When the stock market goes down, you are automatically buying a larger number of shares in a proven winner. When the market goes up, you are automatically buying a smaller number of shares. After ten years or so, even a fairly nasty correction isn’t going to keep you awake at night. If you have significantly increased the number of shares you hold, does it matter so much if the value of single share went up or down?

Personally, I also like grab bags of utility stocks and consumer non-cyclical shares. The dividend for utility stocks is almost guaranteed by state regulators. Although even with this safety net, bad decisions can tank utilities. Still, people are going to flush toilets and turn on their air conditioners in good times and bad. As for those consumer non-cyclical companies, people are likely to smoke more cigarettes and drink more beer in bad times than in good times. Over the last 50 years the cigarette manufacturer, the Altria group has proven to be the best single stock you could own. Have you ever seen an empty CVS? Kraft, Coke, Hormel, the list goes on. People need to eat.

Dave Ramsey is fond of telling the story of an opportunity he had to share lunch with a billionaire. In the course of the conversation, Ramsey asked the man to recommend a book on investment. The billionaire suggested the Tortoise and the Hare. He said that every time he read that book, the tortoise won the race.

Go thou and do likewise.

Proverbs 13:11

Wealth gained quickly will dwindle away, but the one who gathers it little by little will become rich.

Confessions of a Blog Writer

I must confess that I am tired. Although I successfully managed the crisis phase of my family emergency, I am ready to rest, but there are related tasks that seem to show up almost every day. I know that is affecting my motivation to continue writing this blog and working on my other retirement projects.

I must confess that I am bored. It seems that after more than 750 blog posts I have run out of things to say. Finding new ways to say the same old thing just seems to get harder and harder.

But I know that these same old boring things need to be said over and over until you find your way financial freedom. Looking at the increase in household indebtedness and the decrease in household net worth, it is obvious that we, as a nation, are still losing the battle to find financial freedom.

My wife and I recently bought one of those DVD courses, The Science of Natural Healing by Dr. Mimi Guarneri, a cardiologist and expert in integrative medicine. Dr Guarneri seems to begin each lecture on the various maladies of her patients who suffer from heart problems, obesity, high blood pressure, high cholesterol, and type II diabetes with the same refrain, “Food, exercise, supplements.”

I am doing pretty well on exercise. I am walking 25-30 miles most weeks. I could and probably will add a little strength training and stretching at some point, but really I’m doing OK. I am pretty much taking the supplements that are appropriate for someone my age and with my conditions; although I am learning that I could add a little more here and there.

My diet is atrocious. I know that. I don’t need a board certified cardiologist to tell me I am still overweight because I drink beer, eat too much fatty meat, and enjoy every unhealthy carbohydrate known to man, but her lectures on diet (that fall just short of rants) aren’t helpful. I can eat dried beans, raw vegetables, and select fresh fruit with low sugar content. For breakfast I can enjoy steel cut oats sprinkled with Metamucil (psyllium seeds) for a special treat. Can’t somebody tell me how to add a few more vegetables to my diet that taste good without a lot of expense in time and money?

I understand why Dr Guarneri is as serious as the proverbial heart attack. That is just what walks into the door of her office every single day of her life. One of her patients came to her after open heart surgery. He was 150 pounds overweight and suffered from just about every condition that one could imagine. He was in her office because if he didn’t do something pretty radical, pretty soon, he was going to die. In such cases, it wouldn’t be inappropriate to lock the patient up for six weeks on a diet of raw kale and filtered water (no water from plastic bottles permitted).

So, therein lies my problem. I see and read about financial situations that make what is left of my hair stand straight up on my poor old tired bald head. Then I am inclined to rant or despair. A little wisdom in the reader is helpful. If you are flirting with bankruptcy, by all means live on raw vegetables and Metamucil sprinkled on steel cut oats. Hire a personal trainer who will scream at you. If you are doing OK, but need to save more for retirement and your kids’ college education find ways to add some fiber, fruit, and greens to your diet. Find a responsibility partner (your spouse comes to mind) who shares the same problems and goals. Then start walking maybe 20 minutes a day toward the promise of financial freedom. Before you know it, you will be walking more than an hour a day and enjoying it. Now, work harder or work smarter, spend less, save more, learn to invest, and avoid debt like the plague. What other advice can I offer than, “Food, exercise, supplements?”

Super Tuesday

Yesterday was Super Tuesday, the single most important day in our country’s presidential primary process. Waking up in the middle of the night I looked at the preliminary results. When I couldn’t go back to sleep I checked the results a second time. When I finally got out of bed this morning, the first thing I did, before the sacred coffee ritual, was, you guessed it, I scanned the results a third time. All this and I don’t even really know what I want to happen in this presidential cycle. In the last 24 hours, I felt a lot of different emotions, none of them good. Generally speaking, emotions are not your friend when making financial or political decisions. There is a reason that marketers and candidates want to whip you into an irrational frenzy. It makes you easier to control.

In studying stress, Dr Mimi Guarneri divides emotions into four quadrants. Politicians work in the High Energy—Negative quadrant. They want to excite emotions such as hate, fear, envy, anger, and frustration. What about taxes, my single largest expense? What about health care now that I am on Medicare? What about the economic future of the blue collar middle class? What about the market, especially important now that I am retired? The list goes on and on. Just thinking about any of these subjects for very long makes me want to jump up and down and scream.

Don’t make any serious decisions about anything if you are bouncing around in this quadrant.

The second quadrant, Low Energy—Negative Emotions are where we find depression, loneliness, sadness, hopelessness, sloth, and self pity. These are the emotions that will keep you from making the decisions and engaging in the activities that will lead you to financial freedom.

The fourth quadrant, High Energy—Positive Emotions sounds like a good thing. However, as Alan Greenspan and Robert Shiller observed, “irrational exuberance” leads to Internet bubbles, housing bubbles, and the like. Bubbles always pop. If you see anything that is going up in value faster than the underlying fundamentals (housing prices vs. median family income for example) don’t be the last fool to parachute off the rocket ride. Joy, victory, courage, and love can all be very good emotions, but if a salesman has you all excited about buying a new $50,000 pickup truck, go home and sleep on the idea. In the morning look at your bank balance and your monthly budget. Is this really a good plan or can I continue to drive that seven year old truck for a few more years? Teenagers in love are not the only people who make bad decisions while experiencing High Energy—Positive Emotions.

Now we come to the third quadrant, Low Energy—Positive Emotions. Joy, peace, gentleness, patience, compassion, and contentment when combined with logic, research, and wise counsel are likely to produce the conditions most favorable to making sound decisions. Nobody who desires to control your money or your freedom wants you to remain in this quadrant. Sometimes that would include family members who love you deeply.

I am trying to ask myself, “What kind of emotion am I feeling? Why am I doing this to myself?”

I haven’t seen my country so deeply divided since Nixon and the Vietnam War. Even back in those dark days, candidates within the same party weren’t eviscerating each other on a regular basis.

It is time to pray:
Thy Kingdom Come,
Thy Will be Done,
On Earth as it is in Heaven.