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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News From Words Versus Paper

Posted on June 8, 2013 by Tom Trimbath

Tap. Tap. Tap. No, it isn’t dancing. Yes, it could be the sound made as I type. It was, however, the therapy a friend showed me for dealing with stress. Many friends have offered their professional help as I navigate my financial turmoil. Whether it’s the tapping, the herbs, the remote healing, the Asian medicines, the meditation, the breathing, or merely knowing my friends want to help, something is helping me get through this. I intended to write about some larger issue, or maybe some general detail about personal finance; but first, I dutifully opened the mail from the credit card company. Tap. Tap. Tap.

Recent readers of this blog know that good news is happening more often, both for the country and for me. You’ve probably heard about the improving American job, housing, and stock markets. My version is so much work that I look forward to hours off instead of days off, whether through foreclosure forbearance or renewed interest my housing situation is heading towards a positive resolution, and my dwindled portfolio jumped more than 50% (though that has retreated somewhat) with the promise of more. The stress-related aches are diminishing to only being present most of the time instead of all of the time. Hey, it’s progress.

The promise is promising, and yet, the current situation is that I don’t have enough to appease my financial shortcomings. As the representative from Fannie Mae said, “From what you’ve shown me, you don’t have enough.” I agreed. On a purely mathematical assessment of my current accounts, I don’t have enough. The pleasant surprise is that he then listened to my reasons for optimism and agreed that I should get more time. Thank you!

Yet, this morning’s mail surprise is that my credit card company has dropped my credit limit to just barely above my current balance. That cushion went away because of my defaulted mortgage payments. Evidently Fannie Mae doesn’t talk to Chase Credit. Ironically, I’ve been paying more than the required amount despite advice to not pay my credit card bill if I wasn’t paying my mortgage. Somehow I’ve been able to pay all of my bills, except the largest one, the mortgage (oops, and one other I just remembered.) The loss of that credit buffer sent me to tapping.

Before I’d learned about the possible foreclosure forbearance I decided to rent a desk in a co-working space. From what others have told me, a house that is going into foreclosure becomes a focal point for a bizarre parade of visitors, some legitimate and some questionable. My work was already disrupted enough with worries about interruptions. I need my work to make the money to resolve my finances (unless some windfall happens), so I had to spend money to make money. I still live in my house, the only house I’ve ever bought that feels like home, but for hours a day I run away to Langley and work from a sweet spot over a restaurant and overlooking a coffeeshop run by kids for kids.

Langley Second Street Market 060713

Yesterday was Friday, and the street is turned into a market of art, music, local food, and even massage. During a break I wandered through and realized I knew at least half of the people running the booths. I like Whidbey. I told a few of them about my new “office” and one was even interested enough to come up and check it out. She’s an entrepreneur too, so we were commiserating over marketing, billing, and the continual effort required to maintain a business. She struck upon a core common aspect of modern life for those who can’t, or won’t, work for a corporate paycheck. It is easy to hear good things, but it is hard to celebrate until the good news shows up on paper or in the bank. Compliments are welcome. Encouragements are welcome. Prospects and collaborations are welcome. Yet those that deliver them are sometimes surprised that the recipient isn’t as enthused. For those who don’t have a large cushion of cash, frequent unrequited enthusiasm may have diminished emotional reserves. “Thanks for the good words. Do you care to buy what I’m selling?” Celebrations happen when the bills get paid, or at least the promised check gets deposited.

Her insight helped me understand my emotions. Good news is happening more often for me. The foreclosure proceedings may be foreborn for three months. The new office may have opened up some new business opportunities. I’ve been told that I am being considered for at least two attractive positions. The potential for good, or even great, news from MicroVision is so incredible that I have a hard time believing it. My home, which is for sale, has even had more traffic from folks that appear to be legitimate buyers; which makes sense considering the bubble aspects of Seattle’s housing market.

Her other insight was to point out that any unsettled feeling I have may be caused by the fact that I still haven’t been paid for a job or two, the news about the forbearance or jobs or house sales are all just words. Even MicroVision’s improving situation is something deciphered from reading the body language of winks, hints, and shrugs. In the meantime, the factual side of the world is as the Fannie Mae rep said, “…you don’t have enough.”

I know the encouraging catch phrases. Whidbey is wonderfully full of coaches, counselors, and healers. If I hadn’t already learned the words before I moved here, I’d certainly hear it here. Which is why many people are drawn to Whidbey. It is a healing and understanding place.

A few months ago, I didn’t have much more than the healing catch phrases. Evidently this blog is a source of encouragement and inspiration. Glad to be of service. Yet I know that most folks in my situation need more than words. They need good news on paper, whether that is a job offer, a check, or an improved bank balance. I can see several ways through to better days for me, and even to enough and comfort; but, for today I have a reason to drive into Langley (the buses don’t run on Saturday and there’s a dance tonight) and work working with words to make some money. And occasionally take a break to tap, tap, tap.

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Corporations Meet Owners MVIS 2013

Posted on June 6, 2013 by Tom Trimbath

Home again from yet another annual stockholders meeting, a right that stockholders can exercise that cuts through a lot of the communication fog, except when it doesn’t. Words are communication, or at least I hope so with this blog, but human communication is mostly the nuances of inflection and body language. Whenever I can, I attend stockholders meetings to see and hear what isn’t being emphasized in the official documents. I also attend to notice what isn’t shown or said. Today’s meeting was for MicroVision (MVIS), a story stock that I’ve told many stories about. It looks like there will be more to tell.

A first point that could appear to be a subtlety. The opening slide that sat there waiting for the meeting to begin called the event the Annual Shareholders Meeting. As I reflect on the pronouncements and intentional obfuscations, I wondered if they missed an apostrophe. Was it a meeting of, or for, shareholders; or was it supposed to be an Annual Shareholders’ Meeting, a meeting owned by the shareholders? To some extent it felt like an Annual Shareholder’s Meeting as if one shareholder dominated. And so it can be.

MicroVision is typical of any startup company that relies on many years of raising money because they have to spend before they can earn. If suppliers and major customers are involved, much of the news is kept quiet to preserve mutual competitive advantages. In some cases, such silence is even dictated in the contracts and agreements. Enforced silence frustrates investors because speculations are inspired by such speculative stocks. A lot of hope is subject to informal hype, or is it just optimistic analyses? It is hard to tell.

Some managers and board members seem eager to tell more than they can. Obvious winks and shrugs show up that aren’t visible in SEC filings. Verbal back-pedaling around possible brand-name collaborations reveals a passionate response, without revealing the why of it. A side chuckle in the audience caused by a proud statement made from the podium suggests another story needs to be told.

There are also Federal regulatory requirements that don’t allow new news to be revealed, unless it can be revealed to the entire investing community simultaneously. This was meant to level the playing field by distributing information more freely, so no one has a timely advantage.

Unfortunately, all of those factors inhibit communication. Some officials seem frustrated by the rules. Others seem to wield them to practiced advantage. This can mean that the very people who own the company have a difficult time learning what’s going on inside their company. As I understand it, shareholders (the owners of the company), effectively hire the board members (by voting them in), and the board hires the upper managers (the CEO and such), and the Chief Officers then run the company and every other detail. Of the four groups, the only ones with the privileged information that can lead to insider trading are the board members and the upper managers. They are the ones who know the most, and are most constrained from communicating.

In an ideal world, a company could work to one of two extremes: only communicate during the absolutely necessary quarterly and annual reports, or communicate everything to everyone all the time. The first extreme makes it difficult to maintain a stock price, create enthusiasm for a product, attract good employees, and arrange for financing. The other extreme is ultimate vulnerability, opening the company up to frivolous lawsuits and extraordinary competitive pressures. The real world is a dance in the middle.

Consider MicroVision’s position. They’ve rarely had enough money for comfort. They’re usually dealing with attractive and profitable possibilities with major corporations. If they talked about the possibilities, they might get better financing and have a healthier stock price, but the openness might scare away customers. The lack of openness scares away investors, but customers who create revenue, income, and profit are more important to the long term health of the company. So, here the company sits, possibly on the cusp of great and wonderful news, and can’t even name their customer who has already paid them millions of dollars. We investors wait and wonder and guess and speculate instead of invest.

Corporations aren’t ruled by one person one vote. They are ruled by one share one vote. The concentration of power changes the dynamics of the conversation. There can be the supposition that those with more shares know more. There is an interesting consequence of management compensation that those who are given shares as compensation can accumulate more shares, power, and potentially wealth, than those who buy shares on the open market. Compensation committees built from the board members are supposed to guard against abuses, but what may seem inappropriate from the outside may seem normal from the inside. An imbalance can result.

The thought of this imbalance is what stayed with me after what was a presentation of a company with enormous potential.

For the individual investor there are two key parts of an Annual Shareholder Meeting: the Business Presentation, and the Question and Answer session. The presentation is a monologue, which I value for the nuances in communications described above. The Q&A session is always an example of great potential denied. A great word battle is played, where a few of the individual shareholders bravely try to word questions that will actually produce answers. They may not even be challenging questions. One from today was about when a customer received their first shipment from MicroVision. The Chairman of the Board quickly stepped in to say that they couldn’t say. The Chief Executive Officer tried to answer anyway. Another asked if there might be an announcement every quarter or so about upcoming products. Rather than point out that they’d hope to but couldn’t because there are no guarantees, the Chairman made sure the questioner knew that it was an unrealistic expectation to be able to answer such a question. I asked about resource limits that may come into play if they were too successful and was delivered a long discussion of why they don’t like the way annual reports must be written.

There is frequently a condescension, as if those with the titles know more than those in the audience. Most of the questions came from investors with decades of experience, some with professional financial or business backgrounds, yet their due respect seems to be measured by where they sit and what they wear. We speak of a divide between the corporate culture and the mainstream. We already have too many divides in our society. I can’t imagine a solution that would be acceptable to most of those that are comfortable with one share one vote. Yet, until such a solution is revealed, I must admit that there is less incentive for Americans to invest in American stock. That is not healthy for our country.

One part of the meeting usually draws less attention from the individual stockholders. It is the official vote, the only part of the meeting that is truly required. Most of the people in the audience don’t pay any attention to it because it is rare for management’s recommendations to fail. The final vote is usually driven by those with the most shares, and usually results in majorities of over 90%. As we left I mentioned to some of the other shareholders that when we hear of such percentages in national elections in other countries, we assume that the election wasn’t free and fair, yet within the corporate world it is normal.

I hope to go back next year, assuming I don’t have to sell my stock to pay my bills. Six of us hung out in the hall after the meeting and compared our interpretations of winks, shrugs, possible accidental revelations, and whatever we could read between the lines. It sounds as if, if all goes well, and I can hang on, my patience will be rewarded. But as an owner of MVIS for longer than the COB or the CEO, and as investor since 1977 in many companies, for now, I just have to guess about the future of the company I own.

For my notes about the meeting go to The Motley Fool, Investor Village, or Silicon Investor.

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MicroVision On My Mind

Posted on June 5, 2013 by Tom Trimbath

MicroVision is on my mind. Tomorrow is their Annual Meeting of Shareholders which I’ve attended for about a decade. The meeting is on my mind even though I know they can’t say anything new without violating SEC regulations. I attend because I consider it part of my due diligence in understanding my investments. I attend because I might get to see new products. I’d like to say I attend because it is free, but it costs about four hours and $25 to get there and back. I attend because I know that, even though they can’t say or show anything new, the meeting is my one chance in the year to hear and see at least some of what the company is telling its larger investors, suppliers, partners, and potential customers. It is my right, and the best way to keep it is to use it. Besides, maybe they’ll have something new to say.

For those of you who haven’t heard the MicroVision story, go back to this blog’s most popular post Micro Vision if you want a deeper description. The quicker version is this. Have you noticed how ubiquitous cameras have become? My laptop, iPad, and cell phone account for four. One path for MicroVision’s success will be to supply projectors that are similarly small and seamless, and we need displays more than we need cameras. It is easy to imagine this little company that is worth about $80,000,000 being worth more than $800,000,000 – and that’s basically from one product line. Yes, I am a dreamer and an optimist.

MicroVision's first picoProjector, the size of an iPhone. The newest models are much smaller and brighter.

MicroVision’s first picoProjector, the size of an iPhone. The newest models are much smaller and brighter.

If you read that old post and looked at today’s stock price, it would appear that MVIS has been a good investment. Back then in 2011, the stock was at $0.80. As I type, the stock is at $3.15. That looks like an almost four-fold increase, but there was a one-for-eight reverse split in 2012, which means today’s price is closer to $0.40. Oops. Multiply the old data by 8 and wonder at the highest price of any of my Buys: ~ $35 then, or ~ $260 now. Of course, that was near the peak of the internet bubble, and I only bought 100 shares. But they were going to be profitable soon, right? So, as the price dropped and the technology progressed I bought more, and in bigger lots. Friends joined in because of the compelling story, and the price dropped. Technology advanced, and the price dropped. Any day though, the drops could turn around into pops, which is why so many of us hold our stock. Any day has been delayed for so many days that many others have sold and moved on to other stocks. They can always come back if the right news is announced.

The term “Investing” has many definitions. We invest in stocks, real estate, careers, relationships, and ourselves. The deeper a person gets into any endeavour, the more precise they can become in their definitions. The media talks about buying stocks as “investing”. After I post about MicroVision, I usually receive a few emails or comments that buying stocks like MVIS isn’t investing; it’s speculating. I agree. Just don’t expect the media to agree. I suspect one quick way for a news show to lose financial service advertisers would be for the headlines to use the word “Speculating” rather than “Investing”. Speculating sounds like gambling, and it is. The pesky truth is that everything along the line of finances is a continuum of risks and rewards. The lottery is at one end. Buying and burying gold is at the other. There are bonds which range from “junk” to AAAs that “probably” won’t fail. Real estate which we all knew was reasonably stable, until it wasn’t. Even gold which is a solid and stable investment, until it bubbles, but we don’t call it that on the way up, only after we’ve forgotten to sell. None are without risk. None are guaranteed.

MVIS is on my mind. Last week I reviewed my finances as I tried to find a way to keep my house. I put together a profit/loss report for my business, and was pleased to see that my business has already made more in a few months than it had in some years. At this rate, 2013 revenues will exceed 2012’s record by the end of the summer. And then I realized that my dismal portfolio made more than twice that in one week. Granted it was a good week; and no, I didn’t sell. I need about ten such weeks to grow my portfolio enough to get me back into the good graces of my mortgage payments, and selling too early cuts off that opportunity. As incredible as that sounds, such growth is possible from my speculative holdings. That ten-fold growth wouldn’t happen according to a schedule, but it can happen rapidly. The quickest any of my stocks has moved in a day was about 240%, as I recall. Such movements are possible for small companies, especially, when they are dramatically undervalued.

I am also encouraged by many of you. Yes, I watch you. MicroVision is one of the topics that draws people to this blog. Someone described my open chronicling of my finances as “My Big Work To Do In This World” because so few are willing to speak past our taboos about money. I am honored to provide such a service. Yet for many, my recent drama has been difficult to read. As another reader described my turmoil, it was such a “Perfect Storm Of Misfortune” that it is unbelievable. It’s been nice to see readers return as the good news has begun. The number of people interested in MicroVision, however, is a larger audience. Both audiences are international, but past posts about MVIS have spiked and included relatively heavy traffic from Italy, Taiwan, etc. The posts also drew traffic from such venerable sources as NASDAQ.com. People want to know about this company, or at least this stock.

The audience is important, not because of some commentary on my writing skills, but because stocks are affected by the same forces as any other product: supply and demand. There aren’t many shares of MVIS; yet, there is a strong latent demand for it. It is easy for an investor, or a speculator, to talk themself into thinking something is “The Next Big Thing”. Sometimes they are right. I think that every time I publish a book. But MicroVision is a case where those few of us who’ve held shares for years can feel this pressure behind us of a crowd looking over our shoulders. They hope we’re right. We hope they’re right. But none of us really know until we receive that real and positive news from the company; or see the stock price spike, which somehow magically precedes many corporate announcements.

So, in the meantime, I’ll go to the meeting (assuming the ferry and the buses get me there on time), come back and write up my notes as usual, and hopefully uncover an insight, an encouragement, and maybe even some good news which will suggest that MicroVision is going to succeed, that MVIS will switch from speculation to investment, and that my finances will improve quickly and well enough to let me keep my house and maybe even step back into semi-retirement.

Yes, MVIS is on my mind.

Dream. Invest. Live.

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Foreclosure Forbearance

Posted on June 1, 2013 by Tom Trimbath

Dynamic times. And yet, “Hurry up and wait” is the theme, at least when it comes to my house and possible foreclosure. Thursday was another rush to get paperwork together for a meeting. Friday’s meeting was worth the effort, even if the majority of the papers were never noticed. I learned a new meaning of the word “forbearance”, and it possibly leads to good news – or at least a delay in the bad news. Bureaucracies can be maddening, but accommodating them long enough to get to a real person can produce unexpected results.

June? How did we end up here? It is the sixth month of the year and about six months ago is when I stopped pay my mortgage. That happens when a person starts running out of money. Through a well-practiced process, a Notice of Default was taped to my door a week or so ago. I called the Washington State hotline included on the note and finally talked to a professional (from Parkview Services) who wasn’t the mortgage company or a collection agency. It was a relief. They strongly suggested I attend a Fannie Mae event, which I attended yesterday. If you want the more detailed story, read through my most recent posts.

The unknown is fertile ground for fears. Walking into the meeting was a guess at what papers to bring (despite their well-documented list I knew background data would be handy), a guess at whether Parkview’s representative(s) would be active support or on the sidelines, and a guess at what kind of person would represent Fannie Mae.

Walking into the unknown to discuss personal failings makes it easy to drop back into childhood fears, except this meeting wouldn’t be about detention but about the possibility of eventual eviction. That’s why I got there early. That’s why I planned to find the hotel meeting room and walk by to get a glimpse and some sense of control. That’s why my attempt at balance was interrupted by a pleasant person from Parkview stepping out into the hall and welcoming me in by name. Oh well, if I’m going to give up my plan, it might as well be to a pleasant smile.

For those who never have to consider going through such a meeting, skip ahead a paragraph or two. For others, it would be a disservice if I didn’t tell you what it was like. It was fine – or at least as fine as such a topic can be. The meeting was set up largely between just Parkview Services (from what I could tell) and Fannie Mae. After it was over I could tell that they had a simple process: 1) sign in, 2) meet with a housing counselor or two to make sure all of the paperwork is in place and so the counselor can prepare the homeowner for the meeting, 3) meet with an official representative of Fannie Mae with the counselor there at least part of the time, and 4) an exit survey, which explained the guy sitting at a table to the side who seemed the least stressed person in the room.

The entire meeting, at least for me, was simply about two questions: A) Did I want to keep the house? and if I wanted to keep it B-for-keeps) How much of a mortgage modification was required to make that happen considering my finances? or B-for-sell) Well, I don’t know those questions because I want to keep the house. Very quickly they reached the same conclusion that I had reached months ago, and that the counselors reached last week. I need to make a lot more money.

The logical part of me looks at those numbers and shrugs. Facts are facts and data are data. Evidently we all had the same factual point of view. We’ll come to the same conclusion, right?

The emotional side of me steps in though and looks at probabilities and possibilities, borrowing some statistical skills from my logical side, and says, “Yes, but everything is improving. Stocks, business, part-time jobs, and serendipities are all heading in the right direction. Even the housing market is improving, maybe the house will sell on the market. 8199 Cultus Drive, Clinton WA 98236 Balance the bad luck in the recent past with good luck in the near future and I can return to financial solvency, even comfort.” I expected no one but my friends and me to agree with that logic. Even with Parkview’s assurances, I expected the foreclosure calendar to continue marking off the days. So, of course you can guess that I was surprised by the man from Fannie Mae. He listened. He was human and he listened. At various times all of us said the same thing in different ways. There isn’t enough money now, but the best bet for everyone is to give me more time by delaying the foreclosure process by three months. It is called a forbearance. I’d never heard the term used that way before, and was glad to learn a new definition within my vocabulary. After about two hours of meetings I was tired and relieved; and in a bit of a silly moment went around to everyone I’d talked to that day thanking them for their time, knowledge, and experience.

Getting there early meant they weren’t tired yet. They were going to be in meetings for two days, and dealing with over 100 cases, which means many more than 100 people. My case is simple: Single guy, one house, one mortgage, about six months of non-payments which don’t total to very much considering typical salaries or even the possible appreciation in my portfolio. Others there were families, homes tied to houses tied to businesses or renters, and some as late as two years. I got the impression that I was one of the few to actually act after only six months. Some begin immediately, but evidently some find ways to delay the process for years. Maybe they were happy to start the day on a high note.

There almost seemed to be an odd common feeling. There are four main parties involved, and only three were there, on purpose I think. Fannie Mae, the investor; Green Tree, the servicer; Parkview, the counselor; and me, the homeowner. Despite the three parties in attendance, the servicer holds a lot of power in terms of deciding how to service the loan, how to proceed. Fannie Mae controls the money, but they can only strongly suggest what Green Tree should do.

Here is where “Hurry up and wait” happens again. At each of these stages, reams of papers are rapidly printed and distributed. There’s a flurry of activity, and then a wait as policies, procedures, and processes are followed. Multiply my efforts by 100, and bump it up from there for everyone else’s complexities, and repeat every few weeks or months. Escalate that across the nation. Enormous costs are involved, both financial and in terms of time and emotions.

Within the next few days I’ll be asked to put together another package. DSCN4423 Each package is similar to what it takes to buy a house, so it is like buying a house every few weeks; but with the same subject each time. Oh yes, and it’s a new month, so the packets must be updated for the most recent bills, the most recent profit/loss statement from my business, and hopefully to include whatever good fortune has come my way.

Stay tuned for that news, because writing about good fortune will be fun for me, hopefully you too, and even for those folks who want to see it in numbers. That will be the ultimate foreclosure forbearance.

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Elucubration Inspiration

Posted on May 29, 2013 by Tom Trimbath

Work twelve. Book six. Actually, work thirteen hours, book six-ish; but hey, let’s not get picky here. Either way it’s a long day. My life has improved. Last year I was working ten or twelve hour days, working on lots of projects, and making far too little money. This year I am working ten or twelve or thirteen hour days, working on just as many projects, and being paid for about half of my time. I’ve also recently learned that I probably qualify for a massive modification to my mortgage if I can double my income. That can work, as long as it doesn’t require me to double my working hours. Ah, but there must be a solution. Many agree and are searching too.

The inspiration for today’s post comes from too many of my friends who have similar work schedules. We may think we’re running our own businesses, but our businesses are also running us. A lot of socializing has stopped. I no longer hold parties, partly because of money, partly because the house is for sale, 8199 Cultus Drive, Clinton WA 98236 partly because many of my friends don’t have spare time, even on weekends. My Sunday evening oasis, when I don’t work after 6pm unless absolutely necessary, has had a dearth of dinner guests because I’ve been to busy to invite folks, and the invitations I send out can’t be accepted because they’re too tired. In a way, this is actually good news. I miss my friends, but I know they are making more than last year; and I don’t want to get in the way of that.

The inspiration for today’s title comes from friend and blogger, Erin Waterman.
“What the heck does elucubrating mean, you ask?  I’ve been “burning the midnight oil” this week with several contract jobs and studies, and the verb elucubrate meant to work studiously by candle light.  Because this word has become extinct, I decided to bring it back.” Elucubrating and Car Repair – Erin Wateman
Pardon me as I step away to light an oil lamp on this grey and rainy morning.Elucubration

The hardest workers I know are sole-proprietors. It is commonly accepted that the first few years will be tough. Ah, but then they finally start making money. But it isn’t enough, and because the business is under their control, they can work harder in hopes of making more. Usually though, such businesses start out by charging less than the competition, so all of those extra hours may not add up to enough. Raising prices can scare away customers and clients, but it becomes necessary. Imagine the celebration of success though when working extraordinary hours finally makes enough. Great! Of course, there may not be much time for celebration, or even a bit of life. Now, the choice becomes growing the business by working even more, raising prices and risking the business, or hiring someone which drives up costs which means the business must grow that much faster – or giving up and using the experience as a great resume line as a proprietor tries to become someone else’s employee. And finding time to apply for jobs is not easy. I’ve been so busy making half of what I need that I haven’t been able to apply to as many positions as I did three months ago. In some ways, the luckiest business owners can free themselves by selling their businesses, but that can be difficult emotionally.

I know printers, framers, seamstresses, herbalists, bookkeepers, artists, writers, healers, and more who are in such a situation.

As tough as I make it sound, many would only consider taking a job to gain security and benefits, and recent corporate history discourages them from expecting that. One friend managed to get a very nice job at T-Mobile, only to get laid off months later. So much for stability. Her response is to keep applying for jobs, but to also finish her manuscript, build out her micro-farm, and reach out to others to build a community.

Pardon me as I step away to handle a job email.

I’m an advocate of personal financial independence. Getting there through a lottery jackpot is fine, but most folks have to save to get there. I managed to retire (temporarily evidently) at 38 because I spent less than I made and invested the rest. It turns out to be the simplified version of the 9-step program championed by New Road Map Foundation (where I’ve been the Board Secretary and am now the Information Manager) and popularized by the book, Your Money Or Your Life, which includes me as a case study in the new edition. The trick for most folks above the poverty line who haven’t encountered any of life’s misfortunes, is to spend less than they make. Staying out of debt is major as well. The trick for many early entrepreneurs is to make enough, then to grow enough, then to finally begin paying themselves with time for themself, and paying into their future by saving. The same potential exists, but the steps may take more effort.

This is no startling revelation, or deep analysis of the news. This is an acknowledgement of how many hidden steps there are on the entrepreneur’s path to financial security.

There’s a solidity to corporate dealings. For employees: paychecks are usually regular, raises are usually a few percent, benefits vary (or decline) around a norm. For customers: prices are what prices are, complaints can be moved up the line within a faceless bureaucracy, returns are relatively easy.

For small businesses the paychecks are called invoices or receipts and may get paid at the customer’s convenience, raises only make sense when there’s a history of surpluses, benefits are expensive, and customers are more likely to negotiate prices, and may not believe that the person they are complaining too is the entire organizational chart and that a return actually has an impact.

This may be no startling revelation, but as the prospect of a life-long career or of being re-hired into the world of cubicles becomes less common a new segment of our population will follow a path of many steps created by others out of necessity. My friends that are on the cusp of success may find themselves being valued as guides because of their experience. Who else better to turn to than a seamstress who has 12,000 people visiting her site every week; a couple of fine herbalists that are enjoying the business in bitters, and who have that much more to offer; and a print shop that is getting to be nationally known for innovation and quality work? And of course, there’s me and my businesses, including my role as a consultant for which another consultant has suggested that I am charging too little. My hourly rate for individuals is $60. My daily rate for corporations is $1,500. He figures I am worth $3,000/day; but, you see, I have to build the business and I’m not quite making enough yet, and I don’t want to scare away customers, and – that’s why I am an optimist. Because that potential is there, and my best next step is to continue stepping in the same direction. And to go out and make sure I have enough lamp oil. In the meantime, I’m going to get back to elucubration.

photo credit - Sue Averett

photo credit – Sue Averett

PS This post is a fine example of how I must manage time. I refer to my necessarily long acronym:
IIHMTIWHMIS
If I Had More Time I Would Have Made It Shorter

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Double Header Jobs And Houses

Posted on May 25, 2013 by Tom Trimbath

My Jobs Report Month 21 was supposed to be the title of today’s post, the necessary update to last month’s post, but a critical foreclosure conversation happened at the normal post time of Saturday morning. In other words, a meeting about my house came up. The two topics are entwined, as they are for most people. Both have entered a new phase. The everchanging story is one reason there is no typical foreclosure story. Those of us going through this are all episodes in some phenomenally large book.

Even Wednesday’s story and then Thursday’s story changed moments after they were posted. Tuesday, some official type taped a Notice of Default to my front door. Notice of Default May 21, 2013 Go back for details. I expected a Notice of Foreclosure, but didn’t complain about not getting it. There was a fourth sheet that mentioned foreclosure, but it didn’t seem to be a prime part of the package. So, Wednesday I posted about Tuesday’s shock. The shock was that I thought they’d said they were going to give me much more time. The other shock was because the taper told me they may sell my house in 30 days. The official notice on the door was good inspiration for finally calling the WA State hotline to find out if I had to start packing. (1-877-894-4663, operated by Parkview Services – a non-profit) I wrote about that, posted the post and shared it around. Knock, knock. My friendly mail carrier shyly had to deliver bad news, several registered letters. I decided you were probably already weary of my housing news, so I held off with the report; especially, when I noticed that the letters looked like copies of what was on the front door. The WA State hotline directed me to the Saturday morning meeting where and when I might get introduced to a housing counselor. That was this morning. Here is that tale.

The short version of house story: I need to make more money. Not a surprise, and actually a bit of a confirmation because that was the conclusion I came to months ago. All of that training in investing and frugality helped.

Needing to make more money leads into the jobs story. So, how’s that job search going? The job I had the greatest hopes for didn’t even give me the chance for an interview, and this is for a job that many in community pointed out to me because they saw me as an obvious fit. Oh well. The job search hasn’t produced a job, but ironically, I am so busy that I have less time to search. I continue to search, but my (part-time) job as Project Director for HCLE’s Virtual Museum is getting busier, and my (part-time) job as Information Manager for New Road Map Foundation is taking even more time than HCLE. That plus a new contract to develop a social media platform for the Whidbey Island Open Studio Tour, and a couple other projects means I’m working billable hours. Even better is that some of those jobs may expand significantly. Most involve non-profits, so that means expansion happens after fundraising. Give – not just to the non-profits I know, but give to the ones you like. They may hire people like me. Yeah!

I’m busy, but it is not enough – yet. That much work still is less than full-time and the analysis completed by the housing counseling company says I need to make more if I am going to keep the house.  Yep. I guessed and actually calculated that. It’s almost as if I have some basic understanding of money and personal finance.

Skipping the many acronyms, in terms of major steps, I am at step 2 of a 3 or 4 step process. It doesn’t feel that way. The language used by the servicing company (that I thought had been the mortgage company) is so strong that it sounds dire and final. The Servicer emphasizes the one extreme, but there is a continuum of possibilities. What I’m learning is that, at each of these steps, many different things can happen, each with different ramifications and timings, and that even the professionals within the process are prone to make mistakes. Some mistakes seem to invalidate a lot of work. Other mistakes can reset the process by weeks or months. Very few homeowners are experts or lucky enough to guess right at every action. Ironically, most of the confusion comes from the protections that work in favor of the homeowner.

After the preliminary group presentation this morning, each of us were assigned someone to talk to, not necessarily our eventual counselor, but someone who could listen and then ask the right questions. The conversation went from the general to the specific.

Maybe they were overwhelmed. Maybe I was lucky. Maybe I made a good first impression over the phone. Somehow I was teamed with one of their senior people. Excellent. I provided the three minute synopsis of what you can read as hundreds of thousands of words in these posts. My situation was simple: Single (divorced), with dramatically depleted net worth (starting with the Triple Whammy), unsuccessful at getting a job (but trying), making insufficient (though growing) income from my business, unsuccessful at selling my house (so far), and with only one mortgage and only one credit card, and living fairly frugally. Oh yeah, and I am optimistic and would like to keep the house. DSCN4419 My Hardship Letter, and yes, I’ve dutifully written one and will re-write it, should read fairly well – except for not having enough money right now.

Then came the details. You’re safe. I won’t write them up because almost everyone would understandably skip right over them. But there were two main processes, one’s for time, one’s for money.

The time process is something like:

  • clock started when I stopped paying
  • about 90 days later receive a Notice of Default
  • about 90 days later receive a Notice of Default, which just happened, but it sounds like it should have been a Notice Of Pre-Foreclosure Options
  • about 30 days later receive a Notice of Trust Sale
  • about 120 days later “They” sell the house
  • about 20 days later I must vacate the premises.

But, every date and period can be varied, sometimes shorter, more times longer. So, a 350 day process can easily extend to a year or more. WA Foreclosure Timeline 2012 From I heard, asking for an official meeting with Investor (Fannie Mae for me) with a counselor and or a mediator can put the process on hold, frequently for weeks or months. We might schedule that meeting during another meeting next week.

At any meeting everyone wants to know about the money. Got enough? Nope? Well, then there’s a four step waterfall that I’ll have to check from my notes. Here’s my understanding of it.
1) Recalculate the mortgage based on current income, with the late payments and penalties added to a new loan amount.

If that didn’t work,
2) Drop the interest rate until the payments can work, maybe as low as 2%.

If that didn’t work,
3) Extend the period up to 40 years

If that didn’t work,
4) Forebear some of the Principal, which I think of as Defer some of the Debt, effectively saying some portion of the balance is interest free, but still must be repaid at the end.

If that didn’t work, then a mortgage recalculated for current income, at a 2% rate, for a 40 year loan, that only charges interest on part of the principal, still isn’t enough of a modification.

Without going into the details, I need to make more money from my business and jobs if I plan to keep the house based on income. Basically, a 40 hour a week job, or a bunch of jobs that add up to 40 hours a week, should suffice. That was a lot of work to confirm what I knew, and the confirmation is worth a lot. These details, even in a simple case like mine, are so convoluted that it is easy to overlook possibilities. Others have to consider multiple foreclosures on their home and rental properties, or business mishaps, or estates, or divorces, or combinations.

Sometimes an expert is worth the few seconds it took them to notice the one prime flaw in the paperwork. I spent hours preparing my box of docs. DSCN4423 Two years of taxes, four months of bank statements, enough documentation to qualify for a loan, because it’s basically the same process. And I brought along the note they taped to my door. Tape included. I still haven’t fully understood it, even after study, advice, listening, and asking. A few seconds after looking at it, a glance at the last page, and then the professional stopped. Whoever prepared the document dated the notice before they were supposed to. There’s a process here, and by dating it early it suggests, at least to me, that they’d made up their mind before giving me the chance to respond. That alone may require them to start the process over again, a delay of a few weeks. I never noticed that, and didn’t realize that implication.

I am an individualist. I enjoy working in groups, but most tasks I take on myself. Look at how long it took me to finally ask for help. And as soon as I did, I found help in unexpected ways. The foreclosure process is tortuous, emotionally, and logistically. It makes sense to ask for help. But. It also makes sense to check out the person or agency. Parkview Services seems legit. From what they say, they are paid by state grants. They don’t charge a fee. Washington State is nice that way, evidently; and yet, I am going to do a bit more research. I thank them for the graphic for the timeline above. That’s the best representation of what I call, the “Nominal Process” because everything can change. But, if you are going through this, be careful who you work with because ethics and competency aren’t universal.

Change happens and things are about to change again on July 1st. I must act before that, but then may have to change what I do at that point too. I pity the counselors. They must be in continual training mode.

These few hundred words, the hours I’ll spend preparing packets for negotiation, and the hours I’ll spend considering scenarios are secondary to my main goal: making, or having, or making and having enough money to maintain and sustain a comfortable lifestyle. Live long and prosper.

It is easy to focus on the foreclosure. It is easy to focus on the house. My main focus is to remove the threat of foreclosure and keep my home. And I’ll continue trying to get a job, or add up enough jobs to make enough without hurting myself, or find another source of funds (I’ve got my lottery tickets, and MVIS.) In the meantime, I’ll also keep the house on the market, as sad as I’d be to see it go. And I’ll continue to maintain my optimism. Sometimes something as simple as a date on a form, can open a window through which good fortune can arrive.

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Notice Of What – An Update

Posted on May 23, 2013 by Tom Trimbath

Good news in the foreclosure process, I think. I made a call, took some notes, and decided to record it here for myself and others.

Typing up scribbled notes help me read my own writing later. It is a good opportunity to collect my thoughts, create a summary, and let my mind percolate through the possibilities. Here are the notes from my call to the statewide (WA) foreclosure hotline (1-877-894-4663, operated by Parkview Services – a non-profit).

I’m at Step Two of a three step process. (Astonishing, considering how many steps I feel I’ve already passed through.)
Step One: Notice of Default.
(Received by Certified Mail about three months after I stopped paying in full.)
Understandable, considering that they wouldn’t accept partial payments, so I stopped paying because I couldn’t pay the full amount without going broke.
Step Two: Notice of Default. NOT a Notice of Foreclosure despite what the person who taped the sign to my door said, despite what the mortgage person said on the phone and in the big packet they mailed.
(Received by someone taping four pieces of paper to my front door.) Notice of Default May 21, 2013
Confusing, because I expected a Notice of Foreclosure, but I am not complaining. But the confusing part was that the first three pages are a Notice of Default, with directions for Seeking Assistance (Parkview), the amount I am in arrears (which always sounds weird), and the timing of a sale that they MAY initiate IF I do nothing. Then the last page is a Foreclosure Loss Mitigation Form, which is not a Foreclosure Notice.

Okay, I won’t do nothing. I’ll do something. I decided to call the number on the sheet. And found myself talking to a very nice woman who calmly asked and answered questions, and provided a good education into my situation.

Allow me to interject my own process. Regardless of their process, I continue to work my backup plans which would bring life back to a financial normality, (while also playing the lottery to open the door to positive financial abnormalities.)

Evidently, there are two official corporations involved: The Investor, Fannie Mae: and The Servicer, Green Tree. That was a surprise. I thought Green Tree had the mortgage because I made my checks out to them. Despite all of the contentious and confusing communications from The Servicer (the capitalization makes them sound like players in a movie), the decision maker is really The Investor. Which makes me wonder why I talked to Green Tree at all, which also corroborates the advice a lot of friends passed along.

There are regular events where homeowners can seek assistance in having The Investor intervene in the process, basically delaying the Steps while they review my situation. There’s one coming up this weekend. (Memorial Day weekend? Hope I can get back in time for Mayfest.) Between now and then I have to fill out about 36 pages of documents so they can review my finances and decide whether to renegotiate my mortgage (I think). They may decide to let the process proceed.

If the housing counselor decides to intervene, they’ll apply for a three part face-to-face mediation, which probably delays the Steps by a couple of months at least.

If the housing counselor decides NOT to intervene, I’ll probably receive Step Three, a Notice of Trustee Sale (so where’s the Notice of Foreclosure?) about June 21st, with a forced house sale of about October 21st, after which I have 20 days to move out.

During all of this, up to within 11 days of the sale, I can come up with the funds and pay everything off. Which means, the house can stay on the market and be bought, I can keep trying to make money through a job or my business, and my portfolio and lottery tickets (which sometimes seem indistinguishable) have more time to help.

Note: This is the first time since I stopped paying the mortgage back in late 2012 that the story I hear from various sources is coming into focus. Until now, this was only one of too many possibilities. Thanks to everyone who added their stories and their research that provided a foundation for today’s understanding.

Through this process, in many side messages, quiet sidewalk conversations, and even during a few dances, I’ve heard stories from too many people privately overwhelmed by this process. I’m not surprised. It isn’t easy to talk about, and few would mention any of this in public. It is a painful process, designed to heighten feelings of shame, and a persistent pressure that invades every day and night. Waking up can be a reminder of the temporary nature of where you slept. In some ways, this is cruel and unusual punishment for what, a breach of contract, a crime, or merely an unfortunate financial choice?

As tough as it is, I know it could be much tougher. Missing a payment doesn’t immediately make someone homeless. I’m sure there are places in the world where that happens. This process is convoluted, and part of that is because of the homeowner protections put in place by the government. Consider that, even if they were to sell my house, I still get to stay in it for another 20 days. This entire process takes a year at a minimum. I am very thankful for that. I am not eligible nor receiving social security, a pension, or unemployment; but, I am receiving time and a place to live – and the chance to make it all right again.

Those who’ve read this blog have seen my fears. You’ve seen how I’ve fallen prey to The Servicer’s tactics, how I’ve been emotionally traumatized, and how I’ve worked at resolving the situation in a myriad of ways. You are stout folks to stick with this story. Thank you for being there.

I’ll continue to provide updates. At least I now feel better because there are fewer unknowns. I can plan for specific dates. I can continue to work my backup plans. I can continue to be optimistic that somehow this will all work out.

Stay tuned.

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