Good News Sooner Please

Posted on July 10, 2013 by Tom Trimbath

Sooner or later all of this good work is going to pay off. That’s the conventional wisdom. That wisdom doesn’t come with calendar dates but other deadlines in my life do. The foreclosure calendar continues to mark off dates. The later part of sooner or later eventually becomes soon. When is that? That uncertainty exists for many financially distressed people. There’s even a study about that, and I was chosen as a subject. How do unemployed people handle uncertainty and does social class make a difference? I look forward to the scholarly results. In the meantime, I know that uncertainty requires a strong mental gear box that’s ready to shift emotions to the extremes of high or low anytime during the day; and if necessary, a good steering control to miss the biggest potholes.

A friend echoed the sentiment I expressed in a post (The Day Before). Any given breath can be the divide between a troubled past and a positive present followed by a promising future. Every email, phone call, facebook message, chance meeting can be the moment when “I don’t know how I’m going to get through this” becomes “Yes! Time to live again!”

The researcher was nice enough to spend almost two hours learning more about my situation. PhDs are made from collecting, transcribing, analyzing, and reporting on dozens or hundreds of such conversations. He assured me of anonymity. I assured him I wanted the opposite. I can understand many of his subjects wanting to keep their predicament private, but I’m not going to be quiet about it. The best way to keep a ship from sinking is to get all hands to their stations – now. Besides, if everyone kept quiet, no one else would know there were things to fix or reasons to help.

I’ve listed my reasons for optimism, but most of them include significant uncertainty. Most of the optimisms are backed by events that are out of my control. Stocks are driven by the other investors and the companies’ news. Jobs are like the lottery, I can submit an application or buy a ticket, but some authority figure or chance is really in control. Selling my house, selling anything, is in the control of the buyer. I can decide to sell, and pick a price, but the buyer makes the deal.

I do what I can, and move on to the next thing so there are as many opportunities opened as possible. It keeps me busy throughout the day. Some of those opportunities are actually paying me for my time, but so far they only total half of what I need. They are the encouragement to continue. The same situation plays out for almost every unemployed person I know: not enough cash, and so busy we can’t take time to collect and commiserate – except on facebook.

Most of the negative possibilities are also outside of my control. The “If”s make it hard to come up with quick answers to “So, how are you doing?” To anyone asking the question, thanks for asking and also thanks for listening. If you think the lack of certainty is hard to listen to, imagine the internal conversations that happen every hour. Then realize that those conversations can go on for days, and in some cases years. I’m in my 23rd month of unemployment. My home has been for sale for over a year. My portfolio has been irrationally undervalued for longer than both. And my business, while growing well, will do much better as consultations increase. Charitable pricing is a nice way to start, but it doesn’t pay the mortgage.

Evidently I am good at listening. photo credit - Sue Averett

Evidently I am good at listening.
photo credit – Sue Averett

I’m lucky. Even though my IRA has shrunk, within it remains stocks that have great potential. One in particular, MVIS, is on my mind because its timing is similar to the foreclosure’s timing, but in a good way. There are incredible estimates for MVIS’ value. Let’s take the upside optimistic view of one shareholder and blogger. That estimate is for $1,200 to $1,500 in 2017. Let’s use the $1,200 as a bit of conservatism. If the stock was growing 40% per year, then MVIS would be about $600 in 2015 (Rule of 72). Continue that trend back and MVIS could be worth half of that in 2013, $300. Let me check. As I type we are more than halfway through 2013 and MVIS is ~ $2.20. At $300 per share every ten shares of MVIS is worth about one month’s living expenses. With a thousand shares and MVIS at $300, my mortgage and debt issues are resolved.

The $300 from $2.20 looks like an extreme jump, and it would – or will – be; but MVIS went through a one for eight reverse split. That $300 estimate is more like $37.50. (Note: If your reaction changed, then you have a good example of how the market is affected by psychology and not just math. The market cap stays the same with any split.)

MVIS hasn’t hit those levels because investors are waiting for news. Many of us have bought our tickets (er, shares), but the rest is out of our control. Supposedly very significant progress is being made, but the company can’t tell us about it. We shareholders must look for clues through other companies’ reports, US patent filings, and YouTube videos. (Does this video include MicroVision inside?) Most guesses are for very good news in 2013 (see discussion), which we are more than halfway through.

I told you that to tell you this. Imagine that, even if those estimates are too much, even if they are two times too high, if MVIS hits $150 by the end of the year, then the stock will have to average going up more than a dollar a day. Every day it does that is about a week’s living expenses.

But, I don’t know if it is going to happen. It hasn’t happened so far, but sooner or later the company and the stock can succeed that phenomenally.

Engage the mental clutch and shift gears.

I also don’t know what’s happening with the foreclosure proceedings, but it looks like their schedule probably includes a resolution by the end of the year (the same timing as MVIS). The only entity that does know the foreclosure timing is the mortgage servicer, and they have no incentive to tell me their ultimate plan. Every communication from them includes purposeful uncertainty. Sooner or later I’ll know, unless I get the money to them first.

And that’s the simplified version. Every life has uncertainties, but I’ve never had so many simultaneously and for so long. How do I handle such uncertainty? With a lot of effort, patience, and a hope that the good news comes sooner because at this rate I am running out of later.

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Skip A Step

Posted on July 6, 2013 by Tom Trimbath

A mother talking about her child; “Can’t I just skip a few steps and see how they turn out? That way I wouldn’t have to worry in the meantime. – Assuming everything turned out right, of course.” Patience is a virtue, but that doesn’t make it easy. There’s a lot going on and the interim is messy at least, scary for many, and unfortunately necessary – usually.

The past and future are ideals. Selective amnesia clarifies the past. An inability to guess myriad details simplifies the future. Things were simpler then. Things will be simpler after we get through “this”. The present sits between them, and in the present we are aware of annoying imperfections, troubled by unknowns, and eager with anticipations. There is great uncertainty about where the present will lead, and yet, the present is the only place we exist.
Past Present Future
A few conversations were inspired by my semi-annual portfolio review. The difference between the current stock prices and what I think they should be simultaneously raises eager anticipations while also inspiring cautions about the credibility of my opinions. Regardless of what any analysis looks like, if it is about the future or what should be, it includes assumptions; and assumptions are basically arbitrary, opinions not facts. Of course, what people want to do is skip ahead and see how it comes out. “Tom. So, do you think I should buy some stock?” That may be one of my most frequently dodged questions. I don’t hand out stock tips, though I do enjoy having conversations that help people decide what advice they want to give to themselves. Logically, everyone knows there are no guarantees, but the question gets asked anyway.

Questions about global warming, political evolution, alternative economies, and technology advancements all play out over months, years, or decades. Knowing what to do now would be so much easier if we could skip ahead to check on what worked or didn’t.

For months, ever since I stopped paying my mortgage, I’ve been asked about my plan. If I want to keep the house, how do I plan to find the money? Despite writing it out in a thousand words or so, the question is continually asked. If I could skip ahead, I’d know which plan to work and which plans to abandon. That would’ve saved me a lot of time, and probably even a relationship. Yet here I sit, working my business, talking to people about jobs, keeping my house on the market, and wondering when my portfolio is going to recover or even excel. If I could just skip these steps in the middle that require negotiations with the foreclosure community, then I’d have more time to enjoy things like the art fair going on outside my office, and the various authorities would know what they should do and when.
UBCC 070613
Foreclosure update: For those of you following the story of my housing situation, I have yet to hear any formal word about the forbearance of the foreclosure, but the Notice of Trustee Sale hasn’t been posted on my door (when last I looked). I have been assigned a new housing counselor, who seems inexperienced and seems more likely to parrot the mortgage servicer’s perspective instead of the homeowners’ advocacy I’d witnessed earlier. The servicer (the organization that actually initiates the foreclosure, or not) has decided to not correct the errors in the legal documents, dismissing them as typos. We’ve sent a letter to the State Attorney General asking them to enforce the legalities, requiring the servicer to start over and do things right. Both the forbearance and the Attorney General action processes would suggest that there’s nothing official required of me for months, but my counselor went ahead, contacted the servicer and then advised me to apply for mediation that will be scheduled within weeks, which requires me to produce an enormous set of documents, pay $200 for a mediator, and attend (and probably abide by) a meeting with the servicer, the mediator, probably the counselor, and ironically probably not the mortgager who had suggested the forbearance. Do you think I’d like to skip ahead? All of those steps are required, but if I do all of those steps and don’t have the money, I lose my home. If I skip some of those steps, but find the money, I keep my home. The money is more important than the steps, but the steps are required.

Because I blog about some of my personal financial turmoil, I’ve been honored by those who quietly tell me their tales. There is a quiet otherclass developing of people who’ve found that they can’t get a job, may not be able to keep a house, can not carry health insurance, and basically can not reintegrate into mainstream America. The goal of reattaining the 1950s dream of house, family, career, and vacations is higher than the also unattainable goal of the 1990’s dream of steady income, stable housing, long term relationships, and some sense of a national identity. The steps required to reach those seemingly unattainable goals are being skipped by necessity in favor of innovative entrepreneurship, alternative housing, non-Western health care, and support from a community rather than only a spouse or family.

I’ve mentioned the Walk Away movement before, an unofficial unorganized trend of people walking away from the mainstream seeking what they can’t find there. Thanks to Stephan Schwartz, I read an article pointing out that less than half of American adults have full time jobs. Only 47% are living a life that fits the stereotype displayed in mainstream advertisements. Considering the fact I mentioned in an earlier post, that 58% of those with jobs are dissatisfied with their jobs, very few are working to the lives that government seems to be trying to sustain. By the way, since I posted that piece two bits of data have been updated. Instead of it being 58% dissatisfied, it’s 70%; and instead of there being 3,900,000 uncounted unemployed it is more likely 8,000,000. Which We The People does the government think it is governing?

Many of the folks who’ve told me their stories have also told me about times when they seriously stayed in bed for days, or cut themselves off from everyone because they felt so removed from “normal” life. Dealing with abusive bill collectors doesn’t help. Having to politely walk through displays of discretionary wealth without interacting with it, can become too much of a chore. They skip that step by only going into town when it’s quiet, and by increasingly finding other ways to meet their needs. The shadow economy must be growing.

Increasingly, millionaires are living such lives as well. They recognize that their needs don’t require extraordinary wealth, and that, considering the way the world is shifting, their wealth may have much less value soon anyway. There are many reasons to learn to have a backup plan that doesn’t rely on accumulations of abstractions.

In the meantime, that abstraction called money continues to be important. Ironically, I am optimistic about the probability of accumulating more than enough for myself. I understand my value as a consultant and teacher who enjoys listening while implementing pragmatic progress. I am encouraged by my semi-annual analysis of my portfolio. I am optimistic because, even though I’ve witnessed unexpected and extraordinary bad luck, I know I can experience unexpected and extraordinary good luck. But it is that meantime that is the present that is messy, that requires me to not skip any of these steps. But the steps I take don’t lead back to what convention expects.

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Happy Belated Third Of July

Posted on July 4, 2013 by Tom Trimbath

Crackle, crack, snap, pop, whistle, pop, pop, pop, snap. Not a Rice Krispies commercial. It is 11:15pm on the third of July, the night of the main celebrations on South Whidbey. Celebrate here on the third, and you can also go to Seattle for the bigger displays on the fourth. We do things a bit out of step with everyone else, and it is our differences that give us character. I was about to comment on silence, but another barrage just began. Exuberance happens, whether it is legal or not. I lead a unique life. It too is out of step with many aspects of those around me, but it is that difference that helps define me. I guess our nation was built from a similar idea.

My normal time to post would’ve been this morning, like every Wednesday. But, there was a meeting, and then there were chores, and then there was a long interview for a PhD candidate doing a dissertation on what it’s like to be unemployed and how that is reflected across social classes. An interesting day. Then a rare event, two dinner invitations within the neighborhood, both using my neighborhood’s fireworks display as a dessert. It’s part of our dues, and a part that I appreciate more than the pool or the tennis courts. A full day, and just the time to unwind, but pop, crackle, boom, I suspect I won’t be sleeping for a couple more hours.

My normal topic is some variation on personal finance, which has been highly personal lately. I’ve become my own case study. There’s been news about the foreclosure and my business and my portfolio, but the foreclosure news is so convoluted that I probably can’t type it up with these pop, snap, whistle distractions. My business news is enough to encourage me, but nothing definite enough to pass along, and my portfolio news hasn’t changed since I posted it on Sunday (except for the understandably incredulous reactions to anything I write about MicroVision.)

So, as I sit here, listening to the chuff of an illegal firework launching into the neighborhood sky, probably to settle in a yard that doesn’t belong to the launcher, I swing back through history. What was it like to write while watching “the rockets’ red glare?” What was it like for my ancestor, Francis Hopkinson, who signed the Declaration of Independence?

The United States was founded from a collection of colonies that were thousands of miles away from the seat of government. The travel time and danger of crossing the Atlantic meant the colonists would be out of step with England. In some ways that held them back. In other ways it freed them to try new systems of governance, and it required them to become more resourceful. It had to be a scary notion hanging on to the edge of a continent which had no reliable map or measure of its extent. Anything could be in the great empty spaces on the parchment. And yet, they felt the need to take on the risk of countering the wishes of the mightiest empire while hoping nothing unexpected snuck up from the wilderness. It wasn’t a want. It was a need. The likelihood of being hanged for treason was greater than the likelihood of achieving independence. The need was great enough to encourage them to commit to a new way to live.

They succeeded, and promptly embarked us on a history of the states never quite being in step with each other. And yet, somehow surviving.

It was Britian’s backlash in the War of 1812 that launched the rocket’s red glare. Again, this country that was slightly out of step with the rest of the world, and was almost tripped by its earlier overlord. The rockets failed. The British had already burned Washington D. C.,  but somehow the United States succeeded. It would be romantic to imagine Francis Scott Key, writing the lyrics to the national anthem while real fire works burst in the air, but he waited until the smoke cleared, the Sun came up, and the larger US Flag (possibly designed by my ancestor) was raised over the last line of defense.

Entire minutes have gone by without another firework, and it isn’t even midnight. My neighbors grow more considerate. Vets with PTSD can begin to relax. Pets will eventually come out from under the furniture, unless they ran away in fright. (Evidently, the Fourth of July, and probably the Third of July, are the busiest times for dogs to jump fences and run.) I’ll finish this post and try to get some sleep.

Many people are living lives that are out of step with the mainstream. Some are by choice. Many are by chance. Personal finances and everyday realities are requiring the re-evaluation of priorities and values, replacing conventional wisdom with resourcefulness and re-designed systems. The over-arcing system (boom, pop – okay the fireworks aren’t done yet) the over-arcing system expects compliance and is confused with lives that don’t fit old models. In the past, that would have unfortunate consequences. But now, in a government “of the people, by the people, and for the people”, at least according to Abraham Lincoln, change should be possible.

It is past midnight now. It is the Fourth of July. I guess that puts us back in step with the other celebrations – but people seem to be obeying the unofficial midnight curtain call. Maybe the island’s not that far out of step. We only celebrate on the third so we can join everyone else on the fourth. Maybe by being a little out of step we can try a different rhythm, while being close enough to the mainstream that they don’t lose sight of us, and also while not being so far afield that something unexpected comes at us from the wilderness.

Even off the island, the stories I hear from others who have lost their jobs and houses are of people who’ve been put out of step and who find that it is nearly impossible to run fast enough to get back to their old place and pace in the pack. They are leading unique lives, redefining finances for people, and in some cases questioning the need for conventional finance, or even conventional currency. Two hundred years from now will anyone look back and write about an anthem written in the midst of such turmoil? Two hundred and thirty seven years from now will anyone note the courage of the people who felt the need for change?

To all who live courageous lives, even if you feel a bit out of step, Belated Happy Third of July.

My favorite way to see red in the air.

My favorite way to see red in the air.

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Semi Annual Exercise Mid 2013

Posted on June 30, 2013 by Tom Trimbath

It’s Sunday, June 30th, a marvelous day in Langley, WA and I sit here typing and calculating from my office while an excellent jazz group is playing very danceable music at one of the local coffeeshops. I watch dozens of tourists and locals lounging about, and yet I sit here and type. Why? Because I take my exercises seriously. Today is the end of the first half of the year. Every six months I review my portfolio in an exercise inspired by Peter Lynch. Basically, know why you own the stocks you own, and check back on their stories to see if their story has diverged from your intent. I do this via a series of short paragraphs posted to discussion boards because: 1) the best measure of whether I understand something is whether I can explain it to someone else, and 2) by making my reviews public I can learn from others’ feedback and they may learn from me. This blog acts as a summary and a collection of the links. But again, why do this on such a nice day? So I can eventually afford to do what everyone else is doing (except for June 30th and December 31st of course.)

Did you know I wrote a book about this stuff? Dream. Invest. Live. is my personal perspective on personal finance, and is a mix of my experience, insights from Your Money Or Your Life, and strategies from One Up On Wall Street. My book had the unfortunate timing to come out as the market crashed a few years ago. My portfolio had the unfortunate timing to be called upon after I bought my first true home as my business had yet to gain traction. The sales have been understandably embarrassingly slow; but, while many expect me to disassociate myself from what I wrote, I find myself more confident that it is written well, is valid, and informative (as others have told me.) As several financially literate friends have comforted me, their analyses agree that I’ve just been hit with a perfect storm of bad luck. For now.

My preferred analysis for a stock is “Present Value of Future Revenues Discounted for Risk.” I intended to do such an analysis for each stock until I pulled up their financials. Something is definitely amiss. We’ve had years of irrational markets and my stocks, and probably many small cap stocks, continue to experience the symptoms. I realized that some of these stocks, er, all of my stocks, are so undervalued that I didn’t have to dive into such an analysis. A much simpler analysis meets my immediate goal of finding a possible way to pay off the mortgage (or at least avoid foreclosure) and return to a thriving lifestyle, or at least one that isn’t fraught with worry. If you want the more complicated, yet approachable, analysis, go buy my book – or at least get it from the library.

My simpler analysis looks at two ratios: price/sales and price/book. Price/Sales is the ratio of the stock price (though I use market cap) to the company’s sales. I use sales instead of earnings because earnings are too susceptible to bookkeeping abstractions. Price/Book is basically the company’s net worth per share. If it is one then buying a share of the company is buying a dollar’s worth of assets – sorta. Both ratios can vary greatly depending on the company’s maturity, market, industry, competition, and history.

For my simplest analysis I checked to make sure each had a positive net worth. Good, though shaky in some cases. Then I checked against my preferred P/S of 6. Six is a good conservative number for healthy, mature, growing companies. The average P/S of the companies actually making money from customers was only about one. If those stocks regained those ratios, that portion of my portfolio would increase six-fold. What investor requires more of a return than that? Of the companies that were within a year or so of getting their products into market, reaching a reasonable market cap of one billion dollars would create a ten-fold increase in their value. Granted, a billion is an incredibly rough guess, not even an estimate, but disruptive companies are hard to analyze and can easily attain such values when they are successful.

I am heartened.

My portfolio possibilities can far exceed any financial influences of mortgage modifications.

  • Currently, my portfolio is enough to pay off my credit card debt, but would leave only a few thousand for emergence funds and my retirement account.
  • If all of the stocks reached P/S = 6 at current revenues and products, I’d have enough to catch up on the mortgage and even pay off the credit card debt. This is close to what I consider a conservative rational market valuation. It assumes no growth.
  • The same is true if two of the disruptive stocks, MVIS and GERN, reached market caps of $1B. Then, I’d also have enough for a few more years of living expenses.
  • If they all reached market caps of $1B, I’d have enough, that if necessary, I could pay off all of my debt and still have savings. This is reasonable if the market was valuing companies and stocks based on the present value of future revenues, which does not seem to be happening for such small companies – though that may be changing.
  • As I said, valuing disruptive companies is difficult. While my estimates for MVIS are in the incredibly modest range of $640 (only $80 pre-split for you knowledgeable in MVIS), others estimate as high as $1,500. At that price my portfolio is so much greater than “enough” that philanthropy can become a wonderful occupation.
  • If GERN matches MVIS’s success, well, it will be time to give away lots of money.

So goes the money story. Of the list, only one scenario leaves me with my current worries. It is the current scenario. I considered such a scenario to be unbelievably unlikely, yet here it sits.

There is a time story. Waiting isn’t an option, or at least much of one. Ask my mortgage company. For my portfolio to provide a source of income in time to allow me to keep my home, my portfolio must grow quickly. There is reason to believe this is possible. these undervalued stocks have moved up impressively within the last year. RSOL alone went from $0.40 to over $7.00. It came back down, but its competitor trades forty times higher. There is plenty of room to grow. MVIS’ first major success is hinted at happening within this year, probably the next few months, possibly the next few weeks, and is supposedly going to be followed by up to four such deals within twelve months. The possible foreclosure of my home is working to a similar timing.

Conclusions? I am heartened, but I am also working on a Sunday because where I am is what I have to work with and I’ll only change as good news arrives. Analyses are guesses, and these analyses are cruder than most, yet suggest I don’t need to do more. If I did, each of those scenarios would be even better because the above analyses did not account for subsequent products and premium pricing for closely held stocks.

I encourage you to make up your own mind. Here are links to my descriptions of my remaining holdings (as I fondly look back on FFIV, PIXR, SBUX – and yes, even DNDN.) As I said above, I post these on discussion boards because of the value of the discussions. Read on and speak up! I truly do want to read what you have to say.

Investor Village
AMSC
GERN
GIG
MVIS
RSOL

The Motley Fool
AMSC
GERN
MVIS
RSOL
Economy and Markets

Silicon Investor
AMSC
GERN
GIG
MVIS

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Forebearance Foregone Or Not

Posted on June 29, 2013 by Tom Trimbath

What I want to do isn’t what I should do, but I may anyway. I want to devote today to analyzing my stocks for my semi-annual portfolio review, due for my self-imposed deadline of midnight, June 30th. I want to dive into revising the program plan for the HCLE Virtual Museum. I want to further edit the What’s New newsletter for New Road Map, and to research grant possibilities to further NRM’s value based financial literacy mission. There are personal finance stories to blog, other people’s stories to tell, other insights to pass along. There are probably six other things I’d rather do instead of decipher the latest installment in my house’s foreclosure story, but I’ll probably have to do that regardless of my emotions. This post helps me do that. The mortgage servicer delivered a declaration that is out of synch with the rest of the story, and my housing situation may bear the consequences. How does anyone keep track of all of this?

About a month ago I finally met with the key player in my mortgage story: Fannie Mae. There are four main players: Fannie Mae, the investor; Green Tree, the servicer; Parkview, the counselor; and me, the homeowner. That meeting was a pleasant surprise. The Fannie Mae representative listened and agreed with me. Even though I couldn’t make the trial payments, or qualify for a loan modification right then, I had so much potential that we’d all benefit from giving me more time. (e.g. nice testimonials, good resumes, possible house sale) He suggested they forebear the foreclosure proceedings by three months. Sounds good to me. All he had to do was convince Green Tree, the servicer, the company that actually manages Fannie Mae’s investments. They’d get back to me, whether they succeeded or not. Okay. Everything was verbal, but I was sure paperwork would follow, either a forebearance, or a Foreclosure Notice. Neither happened. But I also didn’t get a Notice of Trustee Sale; so that was good.

What did happen was a letter two weeks ago that said I was denied a mortgage modification because I hadn’t made the trial payment in time. I wasn’t surprised because we all agreed at the meeting that I couldn’t make the payment and shouldn’t be asked to for three more months. I told the counselor and just assumed that the trial payment referred back to an earlier offer that helped inspire me to take the meeting with Fannie Mae. I may have been mistaken, and I suspect you aren’t surprised. Earlier this week I received a large packet from the servicer. I worked until 10pm Wednesday, the 26th; so, I took the letter to work on the 27th. When I opened it I learned that I had to contact them by the 27th. Well, that would’ve been tough to do. I photocopied the entire packet, sent it to my newly re-assigned counselor (the third one I’ve worked with at the organization). As I did so, I noticed that the packet I received on or about the 26th (I can’t tell what day it was put in my mailbox) included documents dated twelve days earlier. They’d been working on this for weeks but I only get the news at the last minute. Ah, but surely the counselor will refer back to the Fannie Mae meeting and and other effort they initiated to restart the process. No. What I heard from the counselor was that I should do everything I can to make the payment by July 1st – which is a Monday – which means the 29th and 30th are the weekend, which meant if I had enough cash sitting around on Friday and could put it all in one place and get the check to an overnight service that I might meet the deadline if they would accept it being on July 1st instead of by July 1st. If I could do that I probably wouldn’t be worrying about foreclosure.

As I sit here I don’t know what is really going on, but yesterday, after working until 9:30pm again, I noticed that on Friday I received a letter from Fannie Mae. I’ll open it in a bit. If I did it early on a Saturday I might be so set off that I wouldn’t be able to do the one thing everyone involved wants me to do: make more money.

And my situation is simple. As I’ve said before, imagine what it is like for people who have even more chores than me: people with children, people spending time as care givers, people running businesses, people managing other aspects of their lives that may also need bolstering. It isn’t as simple as reading the letters, and even that isn’t simple. The letters are written in legalese. Each letter is to be copied, recorded, sent to the appropriate people, and if there’s time, understood. The envelopes also have to be copied and saved, but not marked up. To me, it is largely a large pile of paper. It was the counselors who were familiar with the forms that were able to find the mismatched dates on the Notice of Default, which means the process must start over. Every month, or every packet that leads to a payment, also requires hours of work copying the previous preceding months of financial statements, bills, and even profit/loss reports. It is a daunting amount of work. My situation is simple and I can’t keep up with it. Properly handling every communication costs hundreds of dollars of my time, and I have so little free time that the lawn isn’t mowed often enough and the garden has to fend for itself.

I work any day that has the letters “d a y” in it. I see the process designed for my protection and enacted by the paid staff at the organizations, and I know that while they ask for documents, the situation demands money. If I can’t make enough money, the documents aren’t enough to save my home. If I make enough money and lose my home because I missed some documents, well, then at least I have enough money to find housing. (That’s not the case in every state or every situation, which is hard to believe.)

It is getting close to noon. I’ll finish this post, share it around, and arrange myself for the rest of the work day. Fortunately, I enjoy a lot of my work (there are always bits that are more chore than joy.) I’ll get some good work done that will help my clients. The better their projects proceed the better my position may be. I’m also looking forward to my portfolio review. The total value isn’t very large, but the potential is significant, and the companies have made six months of progress since the previous semi-annual review. Yesterday, my portfolio increased by about a week’s living expenses. The preliminary analyses suggest my portfolio can do much better than that. Can it do enough, and can it do it in time? I don’t know and can only guess – with the aid of a bit of arithmetic.

There’s another great potential that fortunately takes little time and effort. As I said in Wednesday’s My Job Report Month 22,
“Similarly, my best business tasks have all been unsolicited. Someone calls me up, or interjects into a conversation that, “Hey, you could probably do that. Do you want to?” “Yep.” Ads aren’t nearly as successful.”
I may have already done what needs to be done. And of course there is that lottery ticket, an easy way to buy hope – that has been known to succeed. Good luck happens, too.

To those who’ve privately replied with their stories, here’s a toast to your forebearance, because whether the mortgage company provides it or not, we’re demonstrating massive amounts of it every day.
Cheers
Thanks for staying tuned.

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My Jobs Report Month 22

Posted on June 26, 2013 by Tom Trimbath

Do we have to do this yet again? Evidently. If you start telling a story, you have to be willing to finish it. I’ll continue posting about my job search until I don’t have to search. The search continues, but has changed in style and expectations.

For twenty two months, since the dramatic falls in AMSC and DNDN and the lack of counterbalancing news from GERN, GIG, and MVIS I’ve been looking for a job. (Here’s last month’s report.) The search has gone on so long that some assume that I must have a job by now. I certainly expected to have found at least one bad full-time position, but in twenty two months I’ve only had one interview for a full-time position. The half-dozen or so other interviews were for part-time or temporary work, and I didn’t receive any offers from them either. Most of the rejections have been highly complimentary. I expected in those months that those stocks would’ve recovered, I’d find a full-time job that sustained my frugal lifestyle, my house would sell, and that my business would grow enough to add the extra that made for more than enough. Even if all of those things didn’t happen, one happening would be a major improvement. Two happening would probably be sustainable. Three happening would allow some comfort, ease, and enough growth to plan and dream and maybe do – something. Oh well. Not so.

And yet, here I sit at 3pm with a dozen items on my to-do list, not including looking for a job.

In numerous news reports I read aspects of the same story. Unemployment is low for people over 50, but if they lose their jobs it is difficult to find another. Entrepreneurship is more successful than employment. It has to be. Seen from this side of the financial fence, the rich do get richer and the poor do get poorer. The penalties I’ve witnessed, the retracted opportunities, the judgment of a person’s worth based on their wealth  can explain the sharp distinction between rich and poor that recently was a smoother transition called the middle class. I’ve been busy, whether you want to imagine it as “pulling myself up by my bootstraps” or “rapidly weaving my own safety net while falling” my own actions were a better bet than conventional responses.

Those dozen to do items are almost all directly business related. Eight of them have direct or indirect income. The rest are maintenance and a bit of marketing. Before I go further, allow me to disabuse the notion of the self-made man. A business does not exist without customers. A consultant needs clients. An artist needs patrons. Thanks to everyone who pays for my services and buys my books and photos. In the conventional definitions, none of the tasks are jobs because none of them involve paychecks and Form W-2. Income comes in from invoices, handshake agreements, and reported on Form 1099. And yet, I’m making half of what I need and until recently have been working twelve hour days.

Twelve tasks and only less than half of what I need is partly explained by the fact that only one of the jobs contracts me for as much as ten hours a week. The rest are less. The majority are temporary. As is typical for any contractor, the number of billable hours is about a third of the required hours. If I’m working twelve, I’m lucky to be getting paid for four. And yet, this is better, much better, than the way things were six months ago.

I chastised myself for not looking for jobs recently. There hasn’t been enough time. The average job application can take an hour, and I have to eat sometime. Sleep has not been easy, but it’s worth the try. A few weeks of that though and I came to realize what hadn’t been working with my job search and what had been working with my business progress. It even entails a bit of conventional wisdom. The best job opportunities were from personal recommendations, and even though they have been unsuccessful so far, they’ve been much better than sending in job applications with the hundreds or thousands of others who are doing the same. Similarly, my best business tasks have all been unsolicited. Someone calls me up, or interjects into a conversation that, “Hey, you could probably do that. Do you want to?” “Yep.” Ads aren’t nearly as successful.

So, my best results come from directions I don’t expect. It is difficult to plan for the unexpected, but I can at least point out that the doors are open, I’m very willing to talk; and that, at some level, I must rely on faith, hope, and trust. Not exactly the sort of progress to report to a financial bureau, but if it results in a job, or enough well paying clients then I can skip the report and deliver the ultimate financial communique: money.

There are reasons for optimism. Two of the small tasks could pay enough if made full-time. Another job possibility has been hinted at that would more than suffice. I found a job opening that was being kept quiet, and quietly got my name on the list. I’ve even rented an office in downtown Langley (pop. ~ 1045, so downtown is relative),

The view from my office.

The view from my office.

which has brought me into contact with another possible job, and more potential clients. There are lots of possibles and potentials.

An actual is that my phase of twelve hour days is being curtailed. Bicycling or busing to the office takes an hour each way. The drive is only twenty minutes, but I avoid it because it costs about $5 per day – making the commute costs higher than the office rent. Besides, working twelve hour days in town is inevitably more expensive because of food. I eat cheap at home. I can brown-bag it at the office, but I’ll eventually forget and leave lunch on the counter at home, or realize there isn’t time to make anything and still catch the bus. I also don’t want to damage my already cracked laptop, so it stays in the office. My iPad is handy, but it can’t handle my client’s tasks. My life is giving me the hint to back off to roughly eight hour days by bus, ten hours by bicycle, and only use the truck for longer shifts or days with more stops than just my desk.

A few more hours off each day means adjusting my work style and dropping a few personal tasks, but it also means possibly spending more time with friends and more time with me. Because, as my book title (Dream. Invest. Live.) alludes, Dreaming and Living are important too. Besides, a friend may suddenly say, “Hey, you could probably do that. Do you want to?”

In the meantime, stay tuned for my semi-annual portfolio review that I will somehow accomplish by midnight June 30th. Maybe I won’t need a job if the market believes in the value of even a few of my stocks as much as I do.

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Extrapolation Or Speculation

Posted on June 22, 2013 by Tom Trimbath

“So, how are you doing?” “No, really; how are you really doing?” Working every day, usually at least ten hours, I’m making half of what I need. That’s the answer based on the present. There is an infinity of answers, and that’s true for me, society, civilization, and the species. My answers rarely seem to satisfy the most inquisitive, but I’m not being evasive. The only answers that are strong declarative statements are also facetious. Where we are is not where we’re going because nothing on the personal through the universal level can avoid change forever. The guess at the general direction is either extrapolation or speculation. Which do you prefer? How about a mix of the two?

Extrapolation is easy, but simplistic. Most folks in similar situations to mine have this same problem.

  • Assuming nothing else changes, I’ll run out of money as soon as I spend what’s in my wallet. At my current spending rate, that will take about a week or so. Of course, I’m not spending anything at this moment, so I guess I’ll never spend it all. Okay, so that’s too simplistic.
  • Tapping into savings, assuming that my income and expenses remain the same, (I hesitate as I type because I hesitate to calculate this) I’d lose my house about the time I can start receiving a small retirement that still wouldn’t be enough to keep my house, but would be enough for room rent. That would last for seven lean years followed by leaner years as the retirement scaled back.
  • But things do change, and my income has increased dramatically since the beginning of the year when I became the Project Manager for the HCLE Virtual Museum, the Information Manager for New Road Map, and took on the Social Media Platform management task for the Whidbey Open Studio Tour. My income has effectively doubled while my expenses have halved. With a trend like that, somehow I’ll be making about enough or more about the time I lose the house.
  • Things do change, and the change usually isn’t linear, in which case I could make enough to keep my house, return to making enough, and even possibly thriving. Others agree that my skills at program management are worth much more than I am making, and pay much more than I need; especially, for my frugal lifestyle. (You are welcome to pass my name along.)
One of Sue's shots I use for a new bio pic.

Photo by Sue Averett

Speculation just entered the discussion. Something that isn’t happening, can happen, and if it does, then things can be much better. The least likely possibility is that things will remain the same. Here is where we enter the land of Too Many IFs. Here is where we enter the too-long response to “So, how are you doing?” I have several plans in action. They were backup plans, but now, every one is in operation.

Movie or not, that last one sounds like the least likely, yet my best jobs and clients have been unsolicited. Someone simply said, “Hey, Tom can do that. Let’s hire him.” It can happen again, but how can I plan on it?

People comment on my optimism and positive attitude, and wonder about its source. In the midst of everything I’m going through, how can I be so positive? It isn’t because of extrapolation. Yet, any answer that includes speculation can catalyze challenges and defenses, and uncomfortable turns in the conversation. So far, the challengers have been right. My portfolio hasn’t recovered enough. My business is not paying me enough. My house hasn’t sold. I haven’t found a job that pays enough. I haven’t won the lottery jackpot. Their extrapolations have been accurate. Of course, if I thought they would always be accurate and that nothing would change, then I should just give up.

This is the dilemma of the underfunded. The interest, sympathy, and support inherent in the questions is appreciated; but the simple answers are either too blunt, “Need more money.” or extrapolations from an inauspicious moment in time. The real answer is much more involved, relies on subjective speculations, and entails elements of faith, hope, and trust. The response sounds like dreaming instead of planning. Few have the time to listen to the long list of possibilities; and even if they do, it isn’t exactly a fun topic (unless great senses of satirical humor are present.)

We are engaged in similar situations within society, civilization, and our species. It is easy to believe that where we are is bad (both liberals and conservatives may feel so, though for completely different reasons) and that it isn’t going to change. We’ve never had unanimous agreement about morals and rights. The institutions and systems that are civilization’s foundations are not perfect. Their current imperfections may only be the consequence of the stage of our collective maturation, but the inequities in finance and power are very apparent. Our current population living its current lifestyle is not sustainable for the planet’s biosphere, and if the biosphere doesn’t survive, our species doesn’t survive.

Talking about the present, extrapolating from the recent past, and assuming nothing is going to change is the easy answer. It is the answer that fits in the news bite, at the cocktail party, or in a facebook post. It is the strong declarative statement that, at some level, is facetious. The popularity of the strong declarative statement that ignores change and possibility is why The Daily Show and the Colbert Report have more material than they can shove into a half-hour. The richness of the rest is why The Daily Show’s extended interviews are so engaging. I’m glad to see they are gaining popularity.

We can’t ignore the present. It is foolish to ignore change. I can’t ignore the fact that I haven’t paid my mortgage in over six months – and I can’t ignore the idea that something very good can happen and probably will. We can’t ignore our diversity of emotions, the imperfect elements of our institutions, and the current imbalances in our biosphere – and even if we ignore change, change will occur. The answers to both don’t fit into universally accepted sound bites. We will, however, probably get a lot closer by asking and listening, not just to where things are, or where they’re headed, but also to where they can go and where we want them to be.
Destiny Is Hidden
Reminder: It is almost time for my semi-annual review of my stocks. So, for those of you most interested in AMSC, GERN, GIG, MVIS, and RSOL, those reports should be posted June 30th. (Of course, if I win the lottery jackpot I might be on a vacation somewhere. Hey, it could happen!)

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Real Time Abstract Money

Posted on June 19, 2013 by Tom Trimbath

Got any spare time? Got any spare money? It’s hard to find either nowadays, at least in the bits of North America that I’m aware of. A friend came back from months of visiting Mexico and told me about a culture that is much more relaxed, that values time. Conventional American wisdom is “Time is Money”, which it is when you’re paid an hourly rate; but, spare time is harder to find than spare money. Money can be saved, stored, and expanded. Time simply is. Time simply is precious.

Check around. How many of your friends are working long hours, living lives filled with chores and errands, and maybe only being able to connect with each other on facebook?

People with paychecks are sticking with their jobs even though 70% of them are dissatisfied. (Corollary: Let’s celebrate the 30% that are satisfied with their jobs. It happens.) Jobs cost hours at work, usually time commuting, prep time packing lunches and applying personas, travel time for some, recovery time (also known as vacations) for all. The after-tax hourly rate may not be appealing, but hopefully it is enough.

Entrepreneurs have their version. They’re less likely to work to a whistle announcing the end of the shift, and they have more control over their time for mid-day chores; but a business owner is always on call, it is harder to stop thinking about work, and finishing up around midnight can be a familiar event. But, with the extra costs of time and worry, there are also the potential extra rewards. The work is more likely to be something matching personal talents and skills. The larger and more elusive potential is the path to independent wealth. Roughly paraphrasing from my memories of reading The Millionaire Next Door, the three most likely routes to significant fortunes are: entrepreneurship, inheritance, and investing. A lot of dry cleaners worked hard and retired early.

Inheritance isn’t something to plan for or control. How many people dreamt of inheriting large tracts of land, hoarded gold, and untold investments only to encounter real estate bubbles, commodity crashes, and no record of stocks aside from family folklore? Yet, inheritance is a gift received by enough to account for about a third of the wealthy. The work or good fortune of their ancestors succeeded beyond generations. That is an impressive feat. Enjoy it if you got it. And thank your ancestors.

Investing is appealing because it opens that door to disconnecting money from time. Money is our abstraction. Time is a reality. (Though the existence and nature of time are the topic of libraries of philosophical, perceptual, theoretical, and experimental debate.) Investing, particularly in liquid assets like stocks and bonds, can create passive income. Joe Dominguez famously espoused a Nine-Step program for individual financial independence that ended with Step 9 and investing in something as reliable as bonds. (See New Road Map Foundation’s web site for details. Also check out the book he inspired and that Vicki Robin wrote and then updated called Your Money or Your Life. Disclosure: I’ve been associated with New Road Map for years as board member and now Information Manager, and am a case study in the new edition of the book.) Time doesn’t have to be money. The reality that is time doesn’t equate to the invented abstraction that is money.

Yet, for now, most of us living in modern western civilization work to trade our time for enough money to attain or sustain a lifestyle. Pardon me as I rewrite that to remind my self that I am trading something real (time) for something abstract (money). Evidently though, my mortgage company wants a lot of that abstraction or they are really going to take my house. At some level, we all live under a bit, and a version, of such a threat. Even people with large inheritances worry about losing what they have, because they’ve seen it happen to too many.

Of course, one dream answer for many is massive passive income. Massive passive income (MPI?) can be generated from dividends if the portfolio is large enough for the interest rate. In the past I’ve created massive almost-passive income by buying and holding stocks for years before selling them, an idea that is detailed in my book and the basis for this blog, Dream. Invest. Live.; Dream. Invest. Live. which embarrassingly came out as the market crashed, and which would normally be vindicated by the recent market recovery which massively and unfortunately has not been reflected in my portfolio’s recovery – yet. One or two trades a year isn’t passive, but it certainly isn’t very active either. And there are other avenues for massive passive income that only require a lot of work up front. Such dreams inspire tens of thousands of authors to publish books every year. Very few even cover their expenses, but as I say in my classes, writing a book is like writing your own lottery ticket. You know it probably won’t pay, but at least you can try. Having mentioned the lottery I must include it to be complete. I buy. I hope. My chances are as good as anyone’s who has bought a ticket.

There are lots of avenues for refuting money’s claim on time. Great. And yet, are you reading this post at work, or quickly during some slice of an otherwise busy evening, or as part of a mini-marathon when you read a handful or a dozen of my posts when you finally get a chance to catch up? Few people have much free time. Even those with enough wealth spend a large chunk of their time managing their money. Evidently those avenues aren’t sufficient or effective enough. What can we do? What can I do? I even feel a bit scandalous writing this post when I could be working on someone else’s program plan or social media campaign. There are several manuscripts and recently published books from friends and clients sitting here, waiting to be read and reviewed – and yet I write.

What else are we to do? We continue on the paths we’ve set through decades of habits, making course corrections within our constraints and obligations. Radical change is possible, but can be too disruptive to others in our lives. If nothing else, radical changes later in life mean paperwork must be filled out, taxes calculated, and stuff stuffed, shipped, and sorted. I applaud every bit of progress of anyone working towards a goal of more time; especially, if it also involves less worry about money.

We can also look back and realize how much easier it would be now if we’d done some things simpler back then: spent less, saved more, enjoyed our youth, embraced our values instead of absorbing images from advertising, and living our lives according to those values. And we can shake our heads as we witness young people accumulating financial obligations instead of living experiences, and cheer those who are living individually defined simpler lives.

Okay, enough of this writing. I’ve got to get back to work to make enough, or to give my financial and artistic investments time to create enough passive income.

As for the rewrites of my youth, well, there were the times I should’ve applied at Microsoft and then Amazon, but decided to commit to my aerospace career; I should’ve spent more time sailing and maybe learned to live-aboard instead of buying a house; I never should’ve given up mountain climbing; and I should’ve listened to my own LTBH advice and held AAPL and FFIV – and done so with the house money instead of my play money. Hmm, so if I’ve learned anything, I guess I should do everything I can to hold on to AMSC, GERN, GIG, MVIS, AND RSOL – at least a little bit longer. Oh yeah, and keep buying lottery tickets until I don’t have to.

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Walking To A New World

Posted on June 15, 2013 by Tom Trimbath

Two worlds visited my office this week. Have you heard? I now have an office in Downtown Langley. It’s really a co-working space where I’m renting a desk, but it is effectively mine because I am the only one here almost every day. The world that plays out before me is the life of a tourist town.  As I type, restaurant hubbub rises through the floor and an acapella performance provides sweet background music from an outdoor stage on the other side of the glass-blowing studio. Callahan's Firehouse Businesses are busy. I’ve also had a few visitors, friends and locals who’ve taken the time to visit and talk about their lives and projects. They find themselves increasingly disassociated from the lifestyle they serve. They enable a relaxed culture, yet can’t participate. Instead, through choice or circumstance, more of them and many others are walking away from the old world and walking towards a new one.

Regular readers know I am open about the normally taboo topic of money. Money has been easier to talk about since I realized and accepted the fact that money has no emotion. (Thank you Joe Dominguez and Vicki Robin.) Money makes no judgments. Our society does. Our institutions definitely do. Individuals don’t have to. This may be why some people come to me to better understand how they can handle their situations. I listen, try to acknowledge and alleviate some of their fears, and then talk about what they can and want to do with what they have. (I also consult.) In general, those with the most money have the greatest fears. Those with the least have already encountered their fears, experienced the consequences, and are moving on to find other ways of living. Those with the least continue to have worries and concerns, and most accept that money would alleviate a lot of problems, but they also don’t expect answers and solutions from seemingly anachronistic conventional sources. Few are striving to return to conventional lives, except as a temporary facade.

I had a dream a while ago. (Go ahead and groan. Hearing about someone else’s dreams can be boring, but the imagery fits this post and credit should be given where it is due.) A concrete bridge spanned a wide ravine that cut through a coastal hillside. The bridge looked fine, a little weathered, but no worse than most. The idea of crossing the bridge raised a caution, and for some reason, I decided to look under the bridge. The structure was rusted iron and crumbling. Back up on the bridge, I watched as chunks of concrete fell away. What appeared solid wasn’t. It probably could’ve been fixed, but it hadn’t been, and now it was probably too late. (By the way, this dream happened before one of the local Interstate bridges fell into a tidal estuary. Weird, eh?)

My experiences with mortgages (which I haven’t paid in months) and now credit cards (even though I’ve made every payment) are providing disincentives to subsequent mortgages or returning to regular use of credit cards. I’m feeling nudged to a cash or cash-less economy. My friends are feeling similar pressures pushing them away from the old and towards the new. Unless they are young, they’ve given up on the idea of a paycheck job. Unless they already own their house, they’re finding ways to live smaller and possibly more nomadically. Those with multiple citizenships are glad for the options. I know if I got a job offer from (let’s see where this week’s blog traffic came from) Canada, Australia, India, German, Taiwan, or Singapore I’d be happy, and probably ecstatic, to accept; especially, if their country or their offer included health care benefits. My friends’ experiences with money and debt are convincing them to rely more on barter, shared resources, or alternative currencies.

Sometimes it is easy to see a microcosm and incorrectly apply it to the macrocosm. But threads of news found their ways to me this week. Each item sounded like yet another niche that makes a good story but doesn’t amount to much; until I sat down and started adding them up.

Unemployment numbers are never precise, and I know a few folks who’ve given up. I haven’t found full-time work in over 21 months of searching despite an “incredible” resume. I haven’t given up yet, but I can understand their frustration. But, really, how many people have given up? Evidently there are 3,900,000 workers who should be in the workforce who aren’t counted as unemployed. That’s more than 1% of the US population. “Counting them as unemployed would take the unemployment rate up to 9.8%.” – CNNmoney.com

The number of Americans living abroad, some working and some not, is even larger. 6,000,000 live abroad. – Time World

Whether nomadic as a celebration of retirement or frugality, 1,300,000 live in RVs. – MSN Money

Using barter is harder to track, which of course concerns the IRS, but at one web site. there are 450,000 barterers signed up. I’m surprised there are that many. Most probably avoid such disclosures. – Bloomberg BusinessWeek

Technology is even allowing people to disconnect from infrastructure by supplying their own power, water, and sanitation. There were at least 180,000 off-the-grid in 2006, expected to be over 250,000 by 2010. Considering that estimate was from before the Great Recession, and considering the interest in tiny houses, that number may be greater. Cabin by Angela

The Occupy Movement came from somewhere. Turkey’s catalyst was the possible paving of a small park. I don’t get the impression that Occupy’s recent lack of visibility is a sign of acquiescence. Some small event may create a resurgence.

Even within mainstream America, from people who are employed, living conventionally, using regular cash and credit, are tied into the infrastructure, and aren’t protesting in the streets, 58% are dissatisfied with their jobs and are only likely to try to keep them because of money fears.

One of the more common financial fantasies today is to take the money and run. Luxuries like mansion and cars are losing in daydreams to self-sufficiency, independence, and helping others.

A while back I realized that significant change may happen more quietly than the apocalyptic pundits predict. Millions stepping away from traditional jobs, communities, finances, and governance make much less noise than revolutions captured on video and tweeted real time. Without organization, without challenges to authority, the basis of conventional society may be eroding away, like the rusted supports of a bridge that went neglected to save costs as long as appearances were upheld. People may not march in the street. People may simply walk away from an old world and create a new one.  The biggest activism required may be advocating for zoning rights for smaller houses, simpler ways to allow barter, and a general societal acceptance of innovative lifestyles.

We may witness the “Walk Away” movement. No film at eleven.

This week, someone passed along a David Korten snippet from the recently released movie “Money & Life” by Katie Teague.
“The change we need is not going to come from within.”
“. . . walking away from the king.”
“The power of any ruler relies on the acquiescence of the people.”

David Korten: Walking Away From the King from Katie Teague on Vimeo.

Do I know this is going to happen? Of course not. I merely watch trends. And here is a trend that is quietly including millions. I don’t know if I’m trying to get to the same place. I don’t know if those millions are even walking in the same direction, except away from an old world view. I don’t know if that conventional bridge from a world of worry to a world of enough will stand long enough for me or others to walk across as we look to stocks and jobs. I do know that I have to keep moving, and maybe that old bridge will get some last minute restoration work, or maybe it will stay up long enough for me to run across, or maybe I’ll find some newly beaten side trail that will get me to where I want to be. I certainly don’t see anyone heading back the other way.

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CEOs That Matter

Posted on June 12, 2013 by Tom Trimbath

CEOs matter. Watching CEOs can be as dramatic as any reality show, just as impressive or just as unbelievable. Those people with that rare mix of leadership and management skills can drive a company with the finesse necessary to keep ahead of the competition (or at least the bills) without it getting too many scratches or dents. Seeing the CEO, and the rest of management, in action is one reason I attend stockholders’ meetings. Numbers and words aren’t a company. People are a company, and the people that run the company can define the company. So, it is news worth watching when a CEO leaves, or when a CEO courageously steps up with a bold plan, or when months go by without news. I’ve seen a lot of CEO news lately.

For those just tuning in, I live on an large island with a lot of small towns. Whidbey is one of the largest islands in the US, though most of the folks in its various small towns see us as separate from the mainland, also known as Merika. Small towns have difficult economies. Rural islands have difficult economies surrounded by moats. Businesses that survive such an environment are impressive, and are usually driven by someone with great determination – or luck. Never discount luck. Don’t discount determination, either.

Head out to a friend’s indiegogo campaign and see one business leader who is actually doing that, leading. She’s had a vision for her chocolate business, has managed it well enough to need room for growth, and has a vision for how it and the community can expand and hopefully prosper. It takes months of work to develop such a plan, courage to present it, and resolve to pursue it. Monday evening Mona gave a presentation to a packed room. Her enthusiasm drew a crowd, partly because of her business success and partly because of her outreach.
“Locally, there is the I Believe In F.U.N. campaign through U.S Bank. This is a way to raise funds locally to help businesses in our community become sustainable and unite our town to do collaborate marketing campaigns.”
Of course, maybe it was because she sells chocolate.

A proven business leader stepped up with an idea. People wanted to listen. (Now, let’s hope they’ll fund her plan.)

People also listen when a leader steps away.

The CEO of Real Goods Solar (RSOL) resigned yesterday. The company IPOd (again, but that’s another story) at $6 several years ago, dropped to $0.40 within the last year, spiked up to $7 as part of a rush as investors suddenly realized that solar stocks were dramatically undervalued, and which has now slumped back to about $3. I bought early and have experienced that slide and ride. I continue to think the stock is undervalued, partly because the stock continues to trade at less than annual sales. Solar power is gaining prominence. Sales should grow. The stock should rise. Yet, I winced when I saw the news because the leader and manager of the company was leaving. Even if that is a good thing for all concerned, it is common for a stock to drop with a change in such a key management position. My finances are tenuous enough. I don’t want any more bad news. Imagine my surprise to see that the stock is barely budging today. The CEO had never made an impression on me. Evidently he hadn’t made one on the market either.

I’ve sold stocks because CEOs left. It hasn’t always been the best move. I sold AAPL when Steve Jobs was kicked out in 1983. After all of the subsequent splits, I effectively sold at $2.50. AAPL currently trades at $436. There’s a time when I should’ve adhered to my strategy of Long Term Buy and Hold, LTBH. I’ve also held stocks through CEO changes. Within the biotech world, I watched ICOS, GERN, and DNDN change leadership, hoped for the best despite being unimpressed with the new officer, and was saddened to see passion for helping more than just the shareholders be replaced with a heavy emphasis on money. I’ve held some stocks because the CEO so impressively embodied leadership and management that it seemed like they could make any business thrive.

My favorite is John McAdam, the CEO of f5 (FFIV). I bought FFIV as the internet bubble rapidly deflated. His description of the situation, his management within the changing market, and his leadership of a new direction were excellent. He’s held the job far longer than the average CEO. My investment in FFIV is a great lesson in the value of such a person, confirmation that LTBH can succeed marvelously, and proof that following conventional wisdom isn’t always wise. I sold my FFIV to make a large downpayment on a small house that is my home of homes. Buy low, sell high, and take profits when you can – but. I bought as low as ~ $2.50 and sold in the vicinity of ~$44. Since then, FFIV topped out at $140, though now it is back to $75. If (a favorite word of investors), if I’d held FFIV, I’d probably be able to buy my house for cash – which I’d be able to do thanks to a well-managed company. Oh well.

8199 Cultus Drive, Clinton WA 98236

Few people in any profession embody everything the job requires. We are humans. We are imperfect. Through skill or luck, sometimes the person matches the job. I continue to work and hope that I have enough of the right skills to run my company, Trimbath Creative Enterprises. Everyone has skills and talents that match some job. Even when I am less than impressed with a CEO, I can usually imagine them in a different role. Read my comments about MicroVision’s leadership and realize that, while I’d like to see more dynamism in the CEO, he’s so impressed me with his other skills that I think he’d be an excellent COO in any electronics firm. COO is not a bad gig. I know it pays better than my current position.

Within this small community, here on the island, other impressive stories are developing. I’ve been impressed with Chocolate Flower Farm’s ability to grow throughout the Great Recession that emptied many storefronts in this tourist town of Langley. Island Soap Company has grown from a small retail shop to a major store with significant wholesale sales. Now that tourists are returning it’s harder to visit my friends because their stores are more likely to be busy.

The people who run things matter. They deserve a lot of credit. (Not as much as most corporate executive compensation packages, but that too is another story.) We each run our own lives, which puts us in the interesting position of having to lead and manage our selves. We deserve a lot of credit; especially, when we step up and into a courageous plan to live our dreams. I bow to those who do so.

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