Financial Thoughts
The funny thing about grief related to death is it appears you have several rings of fire - you have those with first ring relationships, the partners, children, parents. Then you have the 2nd ring which may not be that impacted by the death directly, but are directly impacted by the concern for those that were impacted directly, which can be as challenging as the primary ring/impact, since you aren’t the one in charge of the journey. The other trick is to remember how long this trip is for those left behind - months barely touch the wound.
I spent my Saturday, at age 55, 2.5 decades into this Catskill Farms project, running around a broad swath of the Catskills helping families envision their upstate future. Milford to Catskill to Woodstock to Mt Tremper to Milford. Right now, it looks as if I’ve booked work through 2026, and when you have that done, then you get to gauge the extent of the peripheral risk you want to take - it’s not ‘house money’ but the risk ratio is much diminished.
We also have time on our side these days - there is a very low risk related to ‘timing’ - if things take a little longer to sell, it’s not killing us, though it does look like I’ll be engaged in a little borrowing to complete these homes for the first time in a few years. I have one house, Ranch 73, that has been sitting complete for nearly 7 months as I wait for electric to the site (which seems to be gaining traction now) - just sitting there, empty, finished, fully funded, nearly 4/5ths of a million dollars. That’s a lot of money to have tied up, but then again it’s sort of nice to have that diversified investment as the frothy stock market is worrisome to anyone with a brain.
Speaking of the stock market, I have what I thought was a conservative allocation into a dividend bearing etf labeled SCHD - it buys and allocates across non-technology sectors with a long history of principal appreciation and strong dividends payouts - a somewhat defensive position since it shies away from the concentrated gains of the Fabulous Seven (meta, amazon, apple, nvidia, microsoft, alphabet, Tesla) - 7 stocks that have led to a 34% concentration of these holdings in the the S&P 500 - 7 stocks make up 34% of an index that is made up of 500 stocks. It’s not the way it’s supposed to be, but the manager of these funds have no choice but to juice their returns with these holdings.
So the SCHD was intended to be defensive and a counter to the concentration mania, but it wasn’t supposed to be a real dog, returning just 2% in a market where the simple S&P returned 15%. It’s the type of return that pushes even conservatively-minded investors to take more risk. The S&P has returned 250% over the last 10 years.
Though, on the other hand, it’s this type of illogic where a broadly diversified portfolio returns nothing is a red flag of tulip mania mentality in the market in general. It’s when conservative investors capitulate and start chasing frothy returns. Just by the nature of my real estate activities, I’m pretty diversified; I’d hate have 90% of my wealth tied up in the stock market, as money managers can’t sit on the sidelines but know they are playing a dangerous game of Russian Roulette, when a lot of people won’t find chairs once the music stops. According to one graph I just reviewed, the other 494 stocks in the S&P 500 returned -2% with earnings down -8% since 2021. Frightening, when you now add in tariffs.
The micro finance hacks I keep seeing are more and more cra-cra - finance your vacation, finance your airbnb, finance your winter gear shopping cart, finance your holidays, finance your gifts - spread the purchase out over 4 easy micro-financed payments. I’ve never done it so I don’t really know the penalties for missing a payment or failing to pay, but I’m sure it’s onerous. One of the concerns is these type of finance arrangements don’t show up in the overall reporting of credit usage by Americans, so the indebtedness of the typical American may be understated- but I wonder how delinquencies get addressed - can you report a bad debt to the credit agencies if you have reported the debt in when it was originated? Probably.
The Chime advertisement I just watched is probably one of the stupidest things I’ve seen in awhile. It’s asking ‘why should i have to wait for my paycheck until the money hits my account on friday?” “Why shouldn’t I have it now?” Umm, it’s called a payroll cycle and if you can’t wait on a payroll cycle, you probably aren’t doing a great job with your money, since now that you’ve accelerated your payday a day or two, that little hack is gone - it’s not like you can accelerate it further - it’s now baked in just like it was, now it’s a Tuesday instead of a Thursday, and I would guess you are paying for the privilege.
With all the stupidity in America and its money, it’s becoming abundantly clear that to stand out, you only have to do a few simple things right - show up, stay off your phone, stay out of debt and have a reasonable attitude. The bar to success has never been lower.
