Category Archives: Uncategorized

Teaching About Teachers

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My daughter is at the age where she’s able to articulate two things about grown-ups.

1/. We can be caught doing something different than we say.

2/. We often talk about things we don’t know very well.

This gave me an opening to pass along my principles about teachers, BS and integrity.

Step back from the teacher.

What’s your goal with learning?

My goal is to implement the best ideas from experts with specific domain experience.

Implement.

Put another way => pay careful attention to the best ideas from people who have done, repeatedly, what you would like to do… …pick one idea… do it… repeat.

Sounds easy, it is not.

My mind always wants to engage in debate, to point out flaws, to distract itself from what matters => one good idea, implemented in my own life, over and over and over.

Another risk: once I become an expert in one area, I think I know about everything!

I need to change my advisers as I change domains.

AND

I need to stay humble about my current knowledge. The example I use with my daughter is the “hotshot 12 yo athlete.” Fun at the time but the game still has 50+ years to play out!

Know your role.

The student’s role is not to engage. Take the ideas, and implement.

Gain enough experience to be considered a peer, then we can have a discussion.

In doing, you might discover that one-on-one engagement isn’t a productive use of your time! Why do you think I have a blog… 😉

Many great teachers have lives that are a mess. Remember, it is not the student’s job to sort the teacher. Our job is to implement the best ideas of the teacher.

Sometimes the best idea is to see the teacher’s strategy won’t work for where we want to take our lives.

I’ll give you an example, in sport. In my early 40s, with a young family, I took a deep look at the family lives of my peers and competitors. By this stage, I had a very good idea of what was required to excel at athletics. By looking around, I was able to see that athletic excellence was likely to take me somewhere I didn’t want to go.

A decade earlier, it was the same deal with finance. I got a look under the hood of the lives of the very best, and decided I wanted a life that was different.

Athletic excellence, nope. Financial excellence, nope. Excellence to my spouse and kids => a better fit.

Not easy, not always fun, usual better!

I’ve spotted, and hopefully avoided, a few dead ends => seeing where my actions were likely to take me.

A helpful teacher is someone with a good idea that I can implement. The opportunity to learn is everywhere – keep your eyes open!

A coach, or mentor, is something different. This individual has a system for living that we can emulate. This goes further than useful tips we can apply. A mentor is an individual with a values system we can apply to improve all aspects of our lives.

Mentors share the same risks with regard to venturing beyond their area of expertise, but you’ll find they have much better alignment between what they say and what they do.

In fact, your ability to notice a misalignment between word, and deed, is a useful tool. When you detect a misalignment, you’re probably in a student:teacher relationship rather than working with someone you want to emulate.

Take all that energy you have… the energy to correct others….

…and apply it in your own life.

Make a habit of implementing the best advice of others, and do what you say!

Your life only needs to make sense to you.

Quests and Expeditions

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Here’s a favorite quote I learned as a young coach:

We do the minimum necessary to achieve our goals.

There’s a lot in there.

For me, it’s a reminder that a goal balances my tendency to slide away from excellence.

For my family, it’s a reminder to listen to, and support, their dreams.

Related is an observation by a former Olympian, now the mother of a young family:

My life is so challenging right now, I have to give myself every advantage.

This touches on a technique I use in my own life.

Fully commit to a simple goal… “train every_single_day before my kids wake up”

Then let the simple goal nudge me away from my unhelpful habits.

Olympics, marriage, parenthood, business… we can find meaning when we commit to doing whatever is required to give our best.

Choose wisely!

I have a scrapbook from my last mountaineering expedition, May/June 1998 to Denali.

Looking at the photos, I remember nothing!

What I do remember is spending the mid-1990s, sitting in my harbor-view office, wishing I was living the life I have now.

Glad I had the courage to change.

Anyhow, my son loves big mountains and he’s got it in his mind that he’d like to do a trip to Alaska with me.

So I’ve told him that he’s going to have a series of tasks to complete before we’re going to be able to consider something that large. Things like…

  • Skin a 40# pack to the top of Vail
  • Do it again, this time tow a sled, then ski it down two-man style
  • Carry the same pack to the top of a 14er
  • Camping trip from Fish Hatchery to Shavano Trailhead via Collegiate Peak Wilderness
  • Rainier in a day
  • Run the navigation for the family, for a year
  • Backcountry First Responder course

The life that results from the process – a good life, that crowds out a lot of potential difficulties.

I was fortunate to replace mountaineering with triathlon. Endurance sport enabled a daily fix of incrementally working towards my big goals.

As my life become more connected => spouse, kids, community => the nature of my goals grew simpler, but the essence of the game stayed the same…

One positive step, each morning, avoided a lot of self-generated angst.

Creating an incentive to reach towards better.

As The Pressure Comes Off

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It’s the time of year for Rocky Mountain Supercells

In the news this week, Pfizer might be authorized for kids 12+ next week. Another positive development to get our schools back to normal.

A paradox! As the pressure comes off, we see a return of mental health issues.

Not just mass shootings. I’ve felt it in myself, and noticed little bits of “slacking” at the edges of my life. When I was on a pandemic footing, I didn’t give myself the opportunity to back off. Survival is a worthy purpose!

This new observation is the flip side of “the pandemic didn’t hurt as much as expected.”

The recovery didn’t help as much as expected, initially at least.

Same guy rolling along – some better habits, though.

Training => throughout the pandemic, I asked myself what would happen if I rolled 12+ months of base training.

Well… my strength, range of motion, health, mood and sub-max performance are all at 5+ year bests. Fun when I’m training but not much impact in my non-athletic life.

I have to admit, I expected outstanding fitness to make more of a difference. Oh well, not the first time achieving a goal turned out differently than expected.

Creating Space for Surprises – my wife is leading the way here. Coming out of the pandemic she’s making an effort to get out of the routine of pandemic life. Hiphop dance, new strength routines, backpacking, there’s even been discussion of a surf vacation with a friend.

New skills, new energy… good volatility!

Taxes are in the news. The changes have been exceptionally pitched.

First, send a cheque to 160+ million households. Then do it again. Then do it again. Then tweak the tax code to get the main beneficiaries of global monetary policy to contribute more.

I hope the changes slow the rapid asset inflation we have been seeing. My zip code is up 10% in the last 60 days and my tenants are sending unsolicited bids to buy. With 0% rates, this won’t end well.

Before moving to save money on taxes, three things I’ve learned:

  1. Beware of the costs of moving away from friends and family.
  2. While remembering #1, live close to natural beauty.
  3. Surround myself with people who are living a life I wish to lead.

A good way to look at the true cost of taxation is “total tax bill” as a percentage of net assets. I track this at a personal and “family system” level. Get this number down and tax policy has very little impact on your life.

When it comes to taxation, the arguments that resonate most are incentives and winners.

Government is lousy at picking winners => a program that comes to mind is student loan debt – a well-intended program that rapidly inflated the cost of education, reduced the productivity of colleges and created multiple generations of wage-serfs. Great idea, didn’t work and now we’re considering forgiving the least deserving borrowers.

Incentives => government has zero incentive to spend wisely. The whole system is operating on an expense account. All organizations have a bias towards self-preservation and incremental increase in power via budget inflation.

In the private sector, bad ideas blow up, eventually (even with 0% interest rates). In the public sector, they live on. On balance, I liked sequestration, it gave a real world incentive to government (productivity) and a justification for removing the worst ideas/people in the system.

Another “T” => technology. My email adjustment has gone well.

The main change is removing pressure to respond quickly. This lets a thread work itself out before I offer input which, in turn, improves the quality of my input. Scheduled Send in gmail has been a boon (my mean “reply” is 72 hours).

Still haven’t figured out trimming my addiction to news headlines – I think the only way to limit will be to turn my phone off. Once the summer hiking season starts, I’ll have more days out of cellphone reach.

Two more Ts => Trauma and Time

Here’s one to watch. It applies to everything in my life – not just kids.

My experience is different than their experience.

Sounds obvious, yes?

It isn’t.

When my children argue, bicker and fight… afterwards, there is nothing between them. They revert to a clean slate with each other. They are like water.

Me, on the other hand… watching people argue, I (re)experience all kinds of trauma. Memories of my life return, but not as memories. They return first as anger – but that’s just what my brain calls “warming with pain’.

As the experience goes deeper, what’s happening is nausea, headaches and sadness. It’s like watching a sad child form – a good night’s sleep usually sends him on his way. Sometimes, two nights are required.

Exercise helps, move the energy around. As does acknowledging, release the experience.

How does one deal with trauma?

It helps to remember that time will free me.

Everything will sort itself out in time. The kids will grow up and my traumas will be released.

One way or another.

Ski Math

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The tiny dot in the middle of the frame is my son hiking up from a yard sale, in a gale, at the top of Pali Chair. FIVE minutes later he said, “Dad, I’m glad you’re as good a skier as me.” I’d kept my skis during the traverse! They have such short memories.

Our family ski experience is like my Pandemic Predictions => I got a lot wrong.

When I was shelling out for childcare/preschool, skiing struck me as a very expensive way to do a lot of driving, without much cardio.

Not interested.

A friend, with four kids (and a jet), made the observation… “you gotta be able to do something as a family.” Given his role, as the smartest guy I know, we decided to give it a try.

My wife didn’t believe me when I said, in advance, “We’re making a million dollar decision here.”

Frankly, I took it easy on her. The math is daunting…

But wait, there’s more.

Add-in the inflationary effect of surrounding yourself with the largest spenders in our society.

And… have a look around the parking area, with the smell of legal weed wafting across the empty beer cans… Is this an environment where I’d like to leave my teenaged kid unsupervised?

Still… “you gotta be able to do something as a family”.

$175,000 worth of opportunity cost later, I can ski any run, with any member of my family. This makes me happy during a time of year I used to dread.

Total immersion (5 million vertical feet, in three seasons) let me achieve my goal quickly… Something outside, at a high level, with any member of my family.

Unexpectedly worth it… but only after I figured out our family’s cash burn.

I cope with the “demographic” by focusing my energy on seeking to ski like an instructor, with the fitness of a ski patroller. These goals provide structure for my athletic year.

Like much of my outdoor life, my participation is conditional and always one major crash away from ending.

Stay variable.

Family Values 2021

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Here’s another topic from our Couples Retreat.

How do I know, deep down, that I’m a good person?

Implementing my answer has become a source of strength and satisfaction. The answer has to do with core values. Values I use to guide my interactions, and actions.

Why do we believe all family is optional?

By leaving ourselves free to take no-action, we avoid a habit of manufacturing drama, and victimhood, to justify our opinions.

The habit of victimhood is easiest to see in others, but it lives in me.

Living this value takes the pressure off. It’s a whole lot easier to avoid unhappiness than be happy.

Put plainly => there’s no need to manufacture a “slight” to take a break.

Look beyond the slight.

Look inside and you might find unresolved grief, pain from your childhood or other trauma.

Maybe it’s simply a bad habit, of keeping little bits of pain alive.

By making “all family optional” we create space.

Breathing room spreads across our lives – especially when combined with a habit I wrote about last Friday. Letting other people make mistakes.

This could lead to forgiveness, or not. Perhaps, we start by deciding to stop recycling pain by telling stories about “how we were wronged”. Let it go.

To break the chain, we give everyone the right to opt out.

I’m grateful I gave myself permission to opt out.

We’re out, we are free!

To enjoy our freedom, we need to make positive contributions.

I’m a bit money-centric, so my first stop is personal cash flow. Easy to measure, so always given too much weight!

Pay my own way => helpful, but not sufficient.

I had my cash flow sorted by the time I was 21, yet my personal life remained cluttered.

Eventually, I realized too much freedom was a very bad idea. My choice was to embrace the challenge of creating an enviable marriage and household.

The choice to make continuous contributions is a good one => especially when you consider what is likely to happen with the inverse.

It takes time to see what happens when a spouse opts out of their family. The slow-burn bitterness, building to the point where someone burns the family structure to the ground.

Even if everything seemed fine…. Would opting out be winning?

Remember, I’m seeking to know, deep down, I am a good person.

So this freedom-to-opt-out takes the pressure off and lets me have a look around.

Phew!

I’m not bitter. I’m not filled with resentment.

What do I see?

In my case, I see the wisdom of becoming the sort of person who helps others when he doesn’t need to.

Keep coming back to this.

Shed the drama, talk like everyone is in the room, get back to work.

By not binding ourselves together, all interactions become gifts.

Coaching Anxiety

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A desire to achieve can be a powerful incentive to overcome ourselves. My son’s quest for his school’s beep-test record has taught him a lot about human nature in group situations.

Sport is a wonderful place to equip ourselves with skills we can use in our daily lives. I’m going to take another swing at sharing some ideas about anxiety.

First up, the feelings most of us label “anxiety” are useful. They are not a problem to be removed and anxious people aren’t flawed. In my life, these feelings provide little nudges towards better.

When might my emotional state become an issue? When I make quick decisions based on unlikely fears.

I was chatting about this with one of my kids and they stated flatly, “I’m never anxious.” I smiled because this kid has some of the highest baseline anxiety I’ve seen. However, like many of us, they do an excellent job of living with it.

We were on a chair lift. About four towers out they started to get twitchy about raising the bar. This rapidly progressed to mild hysteria, “we are going to get caught and hurt!!!” After we got off, safely, it gave me a chance to introduce the concept of being worried about a future that might never materialize.

The feared future can be adaptive => better behavior nudged by a fear of getting caught.

It can make us miserable => fear of loss, resulting in never taking a chance on improving one’s life.

It can cost us money => fear-based selling in the face of price-volatility

Body composition, friendships, portfolios, marriage, business relationships… all are damaged when we train rapid action based on our fears.

How might we use sport to build useful emotional skills?

Don’t train the startle reflex => endurance sport is filled with opportunities to notice, rather than act on, our instincts. ALL our deepest habits come to the surface in the face of competition and fatigue.

With my athletes, we’d start with bike pacing, and using their powermeter to give them visual feedback (when they had lost their minds!).

We’d progress to getting bumped while swimming, holding personal pace in groups and, finally, letting other people make mistakes.

Letting other people make mistakes => letting others deal with the consequences of their actions…

…this habit leads naturally towards “let it go.”

On the bike, in a race, on a zoom call, at the meal table… notice when the startle reflex is triggered and pause.

As a father and husband, my victories are invisible.

Conflicts not triggered, confidence not damaged, relationships strengthened by not-acting on my fears.

Notice, then let it go.

Vacation Property 2021

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One of the topics from our recent Couples Retreat was vacation property. I needed some time to show-my-work for why I’ve decided to stay variable.

The question, in the context of both buying and not-buying, was…

Will it make a difference?

The question gives me an opening to share some things I’ve learned from 25 years of real estate investing.

1/. I have yet to regret not-buying a vacation property. When vacation markets appreciate, so do investment markets.

2/. The ones-that-got-away have three main attributes: well located, easy to find tenants and decent cash yield. Vacation properties usually only have one attribute… well located.

I’ll share insights about capital allocation:

=> No one in the company is likely to care more about capital allocation than the boss – the CEO sets a cap on how much people will care about capital, and everything else for that matter.

Extend into your marriage, and family….

=> No one will care more about spending and capital allocation than the individual responsible for earning the income/capital in the first place.

Similar to work ethic… the actions of leadership set a ceiling on what to expect. No amount of legal documentation, and pontificating, can overcome this reality.

Don’t waste energy fretting about the way things are.

Be grateful when you’ve been able to create a team that, largely, follows your lead.

Now the math!

I’ve updated my #s for the two markets I follow most closely.

  • A vacation market with an effective yield of -3% (cost to own). I avoid fooling myself that I’ll be able to short-term rental myself to breakeven.
  • An investment market that is generating net cash flow of 2% per annum.

To “get my money back” in the vacation market, the value of the asset needs to grow by 2.5% per annum.

Money back does not mean purchasing power back. The “same” dollars in 15 years time will buy less due to inflation – just look backwards to 2005 in your home real estate market and see what your current place was worth.

We have no idea about what the future holds and 2.5% market growth is probably looking tiny when compared to what you’ve seen over the last year (+30% in my zip code).

You could be right.

I do, however, know markets that are just getting back to their 2008 peaks. In a negative cash flow scenario, that’s a painfully long time to hold.

My goal isn’t to predict an unknowable future. My goal is to answer the question “will it make a difference?”

In the get-your-money-back scenario (2.5% market growth):

  • Take time to calculate your true cost to hold.
  • Make sure you’re OK with permanently increasing your burn-rate, especially if there’s debt service.
  • Know your alternative use of funds => the investment property returns $1.75 for each $1 invested & Vanguard’s VTSAX is currently yielding 1.4%.
  • The vacation property requires an extra $0.45 for each $1 invested. This is before you decide to renovate and burn $$$s on rugs, curtains and furniture!

For that vacation property, here’s what I do…

  • Take the purchase cost
  • Make sure I’m OK with annually spending 5% of purchase cost, forever
  • Consider if I am OK with writing-off the equivalent of 50% for customization, the cost of ownership and agent’s fees

Then remember:

  1. My personal utilization of past destinations has been 15-45 days per annum.
  2. The future risk to my family is we are priced out of our home market (not that my spouse and kids might have to unpack/pack up from a rental).
  3. I tend to change my mind.

Feelings!

One of the challenges with new deals is my feelings are dominated by the expectation of the asset making things better.

I also enjoy the feelings associated with being able to provide for my spouse and kids.

Making things better & doing right for my family => it’s difficult to feel the benefit of doing nothing.

Once I have a good-enough position, the only person who can screw it up is me.

Couples Retreat April 2021

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A couple months ago, I made a prediction… Coming out of the pandemic, it would take very little to improve my life. This past week, we put my expectation to the test by taking a mid-week trip.

We drove 75 miles, stayed in a motel overlooking the interstate, ate mediocre takeaway and had a really good time!

The kids were in school, so we hired two favorite sitters to cover for us. Our kids loved it.

Our lead sitter was duly impressed with how the kids had up-skilled themselves during the pandemic.

“Things change above tree line”

Each morning started with a trip to 12,500 feet.

Our time together was a reminder of the benefits of an athletic spouse, and how learning new skills can benefit a marriage.

Uphill skiing is a skill we learned as we transitioned out of elite sport.

When we met, we spent a lot of time sharing meals in hotel rooms.

Good memories, which reminded me I have something to look forward to… a future life together.

A happy expectation, 10 years away, is a useful antidote to a dark vision that had been appearing around bedtime each night.

Coffee indoors – first time since March 2020

One of last week’s blogs was covered on the drive to the motel. My wife got the long-form version of “using money to opt out of BS“.

The concept is simple but there is a deep human urge to be “proven right” rather than “quietly opt out of drama”.

A effective treatment (for my desire to be proven right) was spending time with preschoolers. A preschooler has no capacity to understand my perspective about what is right & fair!

With little kids, and the child in all of us, it pays to choose peace over drama.

Focus on what works – opting out of drama works.

On Top

One of my 2021 projects is less resistance. I lay things out in my blogs and explain them to my family.

And then…

I follow my own advice and let it go.

Something I let go of last week was a planned trip to ride up Haleakala. It was going to be my June adventure. My wife wanted us to head to Maui as a couple. Fair enough. I’ll probably be able to make the 10,000 foot climb in a few years.

If you want to perform at high altitude then touch 12,000 feet as many times as possible in your training, and do most your sleeping under 6,500 feet. Whatever “high” altitude is for you, just touch it – do your real training (and sleeping) lower down.

With each passing week, it’s looking like Colorado’s summer will be fairly normal. We mapped out the next four months for our kids.

Related, Boulder County has 500 open vaccine appointments for today, as I type this on 4/23. I suspect we’re going to start hearing about vaccine-tourism into the US.

If you are still in the COVID smackdown then take heart. You will see rapid improvement once the weather turns and your local vaccine supply ramps up.

If you’re not vaccinated then be careful. We’ve had a three friends get seriously ill in April.

For me, the money altitude for training is 6,000 to 9,000 feet – high enough to desaturate, not so high I slow down and extend recovery. Once you’re doing a bunch of volume over 9K elevation, it doesn’t translate as well down to where the races happen. Different, however, if you’re preparing for a high altitude event.

Make time for the people who got you through the pandemic.

Thanks, babe.

Freedom 2021

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A big motivator in the finance world is the dream of earning “f-u money”.

The universal motivation for this goal is expressed in the Johnny Paycheck song, Take This Job and Shove It.

Trouble is, once you have a goal to tell people to Eff Off, you will never run out of targets for your ire.

You’ve created a habit that can’t be solved by money – and being consistently abrasive will drive good people from your life.

My friend, who changed my view on the UltraRich, demonstrated an alternative approach.

People think the benefit of wealth is f-u money. The benefit isn’t the ability to be rude with impunity. The benefit of financial independence is the opportunity to say no-thank-you to the ever-present drama around us

The goal, to opt out of BS, doesn’t require much money at all.

However, the first $125,000 I saved nudged me in a better direction, eventually, out of finance.

What my younger self found attractive (in wealth accumulation) was a pathway towards serenity. I feel very fortunate that I gave my younger self a chance to look around.

Serenity was found in nature, in connection and in exercise.

Do I want peace or drama?

Immunity and Disclosure

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Closing Weekend 2021

A lesson I learned in Private Equity was:

Concession for concession

If I’m going to give something away then I should get something in return.

Because the public sector has different incentives than the private sector, it is possible for corporations to gain valuable concessions in exchange for not much in return.

Name an industry with corporate immunity for losses associated with their product.

The first one that usually comes to mind is guns. Here’s a link to a summary of the law – The Protection of Lawful Commerce in Arms.

In Colorado we have the Ski Safety Act (link to the law) that grants immunity to ski operators from the inherent risks of skiing. This act provides a huge incentive for resort operators to expand their Colorado operations. Colorado skiing is better because of this act, and I like to ski.

Backcountry Skiing

If you die in an avalanche in Colorado then the CAIC will do their very best to find out as much as possible about your death. They will publish their findings so the community can learn from the price you paid.

It’s a valuable public service, done on a limited budget ($1.6 million of public money in 2020). The accident reports give us a chance to make individual learning, collective. The reports also enable the public to make informed decisions about how they participate in backcountry skiing.

We have the accident investigation infrastructure, outside the resorts, and it doesn’t cost much. The $1.6 million of public money buys much more than accident investigation.

Investments in Public Safety

When I arrived in Boulder, the junction of North Broadway and Highway 36 was governed by a single stop sign. A cyclist turning left (on to to Hwy 36) needed to cross high speed traffic.

This intersection was the scene of fatal accidents and, eventually, the stop sign was replaced by a traffic light.

Before the light was put in, only the locals knew it was a dangerous location. The highway traffic comes around a corner and would catch unsuspecting cyclists while they tried to clip back into their pedals. I worked at a training camp where an out-of-state participant was killed at this intersection, when he turned back early from a group ride.

Colorado counties have the information they need to make informed investments in their road safety infrastructure.

With our in-bounds terrain, the counties and the public are largely skiing blind.

As a community, we’ve made a choice to accept the inherent risks of skiing.

I support this choice.

By taking personal responsibility for the risks of skiing, we save the ski operators tens of millions of dollars. A large multiple of the value of these savings is enjoyed by the owners of the resorts. The cost of better information would be a tiny fraction of gain in capital value

Improved disclosure, while preserving corporate immunity, would provide a positive incentive for the ski operators to improve their “dangerous intersections.”

Colorado can handle the truth

Here’s a link to the ski safety code – It is common sense stuff. The code fails to nudge skiers away from death and permanent injury.

From reading about fatal accidents, I learned some things I’ve passed to my kids:

  1. Trees kill
  2. Look where you want to go
  3. Hit things with your legs
  4. We don’t know why the rope is there
  5. Bar down

With better information, we can improve Colorado for those who follow us.

Let’s iterate towards better.