More June Musings
Fascinating transition happening in life and business. The slooowwww down. After literal decades of go-go, then two years of rebuilding, then a half a year of financial planning, I have a vision as to what the 3rd chapter of my life might look like. Although, as I put together a new squad in the office - interestingly of all men - maybe the spark to continue gains ground.
It’s an enviable position with lots of options; options that include timing, structure, pace, and commitment. Lucas Petersheim and my mom at Penn State for a football 7 on 7 Summer Ball.
That enviable position comes after the unenviable task of building a company for 25 years, where options were more like requirements, where discretionary meant not if, but when, are you going to do something (correct answer: better do it now).
I spend a ton of time thinking about this business stuff and enjoy it immensely, but I don’t write directly about it, and perhaps I will on this thread.
This classic Cottage keeps looking better with the landscaping, rails, and stone work. The Owners, who work in the sports broadcasting field, have invited us to an 'on the field' experience for an NFL game this fall, to a game of our choosing.
As I’ve said a few times in the past, I write more when things are uncertain - the act of writing for me has always been an effort at figuring things out, an exercise of strategic thought, an outlet for frustration venting. And as you can see over the last 2 months, the volume of my writing has decreased. That must mean things are on the mend, and it must mean I don’t have any front and center nonsense to deal with that is hogging a bunch of head space. Actually, it doesn't mean that at all -but the front and center nonsense is stuff I've seen before, so while it must be addressed, it's not new.
6:45am, Saturday - Off to play some early morning, windless pickleball in Matamoras PA. Then a stop at Home Depot, a couple of chores, obligatory late morning nap, some pool time, a new book, a work out and now watching game one of College World Series - Coastal Carolina v LSU. Update- LSU swept them.
Men’s league (45+ to play, 48+ to pitch) tomorrow at 10am. I’m 0-7 after two games and to add salt to the wound I broke my bat - and those bats aren’t cheap -$200 a pop. Update -this game got rained out.
Ranch 72, waiting on Electric - finished.
I’m mentoring 3 young high school men this summer - Gino, in the office. He’s super smart, just graduated, a walk-on volleyball hopeful, and has been helping with all sorts of tasks. Cameron and Zion, heading into their 11th grade year and good friends of Lucas, are working at my home on the grounds all summer. Building that work muscle, that show up to work everyday muscle, stay off your phone muscle - that work isn’t good or bad, the task at hand not good or bad, it’s just work. And the more you develop that muscle, the easier the task is, and the mind over matter battle is won - if you don’t mind it don’t matter.
I also loan them out to various other companies I know. The pictures below are at Tamerlaine Animal Santuary in Montague NJ, where they muck stalls, and make pals with rescued animals. No meat allowed in the packed lunches.
I’ll probably introduce them to some budgeting apps, and show them how to track their income and spending - develop their relationship and awareness of money, their habits, and the idea that money is 75% psychology and 25% math.
I have a small philanthropic fund (actually, is $125k small? - who knows anymore it’s all so relative and individual) and through that I run a financial literacy program and then hand out (10) $1250 scholarships for those chosen for the class and show up for it. And another $7500-$10k in various organizational grants such as food pantries, equine therapy, libraries, main streets enhancements, etc...
America is full of financial illiteracy, and really it’s a prison of unawareness at first, and then a prison of debt payments delaying, postponing and possibly eliminating the plans for your future.
Lake front home in North Branch NY.
The dumbness of new cars, anything with motors. Of micro-finance where you buy anything and finance it through some simple 'low cost' program. That the billions spent each year in marketing from American companies to get you to borrow, borrow, and borrow. Welcome to the machine, built and maintained for you, for a lifetime.
Even the all important credit score -it doesn’t monitor income to debt ratio, it measures a bunch of nonsense that revolves on how you borrow money - not on your net worth, your income, your cash flow. As a metric to measure someone's inclination to pay their bills without some excuse - yes, good and important monitor of that - but anything else, for anyone making real money and using debt, points, credit cards in a surgical way - nonsense score.
Are these baseball pants too tight? I accidentally picked up 'youth large' and not 'mens large'.
It has been wet in the northeast. Like someone was saying 17 straight weekends of rain. I know the contractors who work outside are struggling to stay on pace with their schedule - especially painters and landscapers. I’m trying to finish up my pickleball court, and that literally is like a 7 stop coating process which is impossible to do in between rain storms. And then it does one day stop raining and these guys are weeks or months behind on their schedule - it’s a zero sum game, it’s not like they can snap their fingers and catch up - you lose a day, it’s lost.
Now it’s hot - heat dome hot. Like 100 degrees in the shade, as they like to say. There’s so much moisture in the ground that the heat is baking the moisture out and windows are fogged up, eye-glasses are fogged in.
We have a large lake front house going up in North Branch for a lovely family. A bigger house, a really fun home where a young family will go to retreat, camp, pick worms, get lost in the woods and kayak on the lake.
Lots of road kill in May - on my daily mid-day walks, all sorts of migratory Bashakill species were getting run over trying to cross the road.
We are finishing up the lake house in Parksville for a family from CT. That project went really well. It’s pretty amazing what we can do when we don’t spread ourselves too thin. We’ve been spread too thin since the very beginning of Catskill Farms. So to take all that administrative, construction, planning expertise and laser focus it on a few projects can really produce results.
The spring and winter were tough with 1, a deep freeze, 2, a lot of black swan warranty and construction issues that I had to solve on my own since the team was in transition. Literally every Friday night or Saturday morning some real emergency would arise to ruin my weekend. It was tough. It was unnecessary. It’s why you always have to keep some gas in the tank, or at least have some reservoir of gas somewhere. Or just operate on fumes, hoping to get it done before the car putters to a stop. It's why this business is hard, especially if you care and take it personally.
I’m in St Petes. Not sure if I said that. Playing pickleball at 7am on 6 courts with 50 players rotating in. Never played doubles before - sort of fun, and definitely aerobic. I have a pickleball court going in at my home and super excited to get playing. Flew down on a plane from RDU with a malfunctioning AC system - the cabin was 90+ degrees. Very uncomfortable and the fear was the temps would keep rising inside that little aluminum bullet. American Airlines - ugh..
Been on a jig to improve my reading discipline - 20 pages a day. It worked and cruised through Salmon Rushdie's Midnight Children in less than a month. It's a good quest, put the phone away, and turn page by page for my daily quota - having read so much about the Satanic Verses, Midnight Children is considered one of the Centuries best 100 books. If you picture a book with the tempo, humor and weirdness of the way Rushdie looks on this book jacket picture, you can get an inkling of the book itself.
June Musings
(note, this was written a few days ago, never finished, and sort of rambling)
The immigration crackdown is fascinating. I use the word fascinating, which one could object to, since it neither relays rage or whole-hearted approval, the two most common responses these days to anything political.
The raids hit close to home the other day with an ICE action in Honesdale, a town neighboring ours. I wonder how and why they chose a little pizzeria in the middle of nowhere to police. The organizational effort being applied to these actions is impressive, or maybe not - take 20 heavily armed masked para-military in war machines and go surround a pizzeria located on a small main street.
On the job fronts, I haven’t heard from any of my subcontractors any noise about raids, men not showing up, etc… and I haven’t heard any news about any of this in the mid-Hudson Valley. I do see on my social media a lot of ‘raids’ and irate community members, but when your feed starts to flood on a topic, that’s when you need to be most aware of the nature of social media - that they feed you what interests you, and the correlation between your perception of what’s going on (based on the frequent feed stories) and what is really going on can quickly diverge.
I’m not surprised the local cops and the state police are helping out - these guys love to get the juices flowing with some over-the-top policing - more fun than pulling over teenagers coasting through a stop sign.
If Trump wouldn’t be his own worst enemy, he could be riding his successful border shutdown program to elite presidential status - it’s impressive and shows how easily a serious-minded person on the subject can achieve results. I get how we are sending a message - if you aren’t here legally, don’t come - that makes sense. That there is a potential cost to coming here illegally, and it’s not a fun price to pay. On the other hand, the individual cases of families being separated, of people who have lived here a long time being deported to who knows where, that’s hard to feel some empathy for. But wishy washy policy makes for wishy washy results.
On the other hand, the alternative reality is these people do a lot of work in this country, so like tariffs, there is going to be a lag before the true cost of the effort is known. I don’t know enough about the tariffs to understand if what we are doing is long overdue and fair, but I do know it sure seems hard not to believe it’s going to raise costs a lot (and add uncertainty and delay into a lot of planning). But on the immigration front, I really don’t know how you replace hundreds of thousands of hard-working, reasonably paid people - less workers, higher rates of pay, higher cost to produce, higher cost to consumer.
I’m sure you all have seen the story of the mid-50’s guy in Nambia on a safari who went outside his tent to take a squirt and got eaten by a lion. Not cool. I’m sure it doesn’t happen much, but still - it’s like a shark attack, doesn’t have to happen a lot in order for it to resonate on a deep level, far outpacing the likelihood of it happening.
We are building 3 homes right now - 2 in Sullivan County and one in New Paltz. I have zero spec homes under construction. This is the lowest risk positioning my company has ever seen. It’s a natural denouement of sorts, an unplanned slowdown, that seems necessary and overdue in retrospect. A slowdown caused by me being tired of the hamster wheel of buy, build, sell, rinse, repeat: of not having the qualified staff to get it done: of land being expensive and hard to find, though I am seeing a slowdown in the liquidity of land, which should naturally bring down the price a bit.
It’s the last day of school in PA, perhaps the earliest ever release from school year. Not sure why, but it is. It’s a sunny perfect warm day after weeks if not months of shitty weather, so that’s fun. Lucas has around 25 kids over - I said ‘how many people are coming over?’ and he said ‘not many’ but then in the next utterance said, ‘hey, you mind ordering 6 large pizzas?’ Reminds me of how clueless I was when my front lobe was undeveloped.
My pickleball court construction is sitting there as a large concrete pad, curing, and waiting on the court painter who of course is behind like everyone cause of all the rain in May. Saturdays have been a mess in general - it’s been months since we had a nice, seasonally appropriate weather environment on a Saturday. At least it’s not 50 degrees anymore. After a long cold winter, the long cold wet ‘spring’ was dispiriting. I think the JV baseball team had 2 rainouts for every game played.
High school graduation is today, and then Sunday if today’s weather looks iffy. They like to do it outside so have to be flexible with the scheduling.
I’ve been exercising regularly now that the weather has changed, walking and biking and lifting lightly. What’s been good is I’ve avoided any injuries which kept occurring because I’m used to continuing to push my limits and gain strength, leading to over-done-it syndrome and some lagging injury, but now I’m more careful to grow any strength training very slowly and aim as much for maintenance as to quick strength building. For 55, I’m doing pretty good - it’s getting close to the age where it really starts to show who’s been taking care of themselves and had an eye towards fitness and health, and those who don’t. At 55+, you can really look worn out, overweight, and over-aged and there is a definite divergence of men at this age as to how they look, act and feel. You can’t discount genetics in this whole scheme of things, but that’s only best leveraged with an accompanying scheme of eye on the ball healthy eating and living.
I put away the bottle of beer and booze almost two years ago now after a lifetime of low-simmering daily beer or drink, and some serious binging. I think it had on-the-margins ‘too much’ over the years, but not really, in the whole scheme of things. A lot of it was just out of habit, - order that instead of this out of habit - so a lot of the drinking was just being mindful and intentional, sort of like how you should behave with money - anything done without thought or awareness can overtime work against you. I think I commented a few times how I felt pretty cheated when the pounds didn’t just fall off after cutting out all those empty calories but it turns out substituting cookies and tastycakes for a beer is a one step forward one step back type of dance.
I handed out 10 $1250 scholarships the other day to 10 Delaware Valley High School seniors the other night, for a financial literacy seminar and scholarship I developed through a small non-profit I fund and run. Stay out of debt, don’t buy shit you can’t afford, have a budget and watch out for student loans. I reviewed 21 applications and got a lot of insight into high school kids these days. By any measure, I’m generous: with my time, insights, money and attention. I think any real generous person never really feels that way, because by positioning yourself as a giver, you always get a lot more requests than you can possible grant.
Been Cold and Rainy in the NorthEast
It’s not going to come as much of a surprise to those in the Northeast about my first topic of conversation - it’s been cold, and it’s been wet. 50’s, windy, and a lot of rain. Memorial Day was punctuated by a circling cold front that dropped showers throughout the day. Today, Monday, it appears that maybe we’ve turned the corner into seasonality.
I can tell it’s been raining not so much by an interruption in construction activities, but in my leisure - no community bike rides in 2 weeks (typically Mountain Bike Mondays and Road Ride Thursdays), no pickleball, hard to sneak a walk in, my pool can’t get above 60 degrees, my garden is wilting and yawning for the sun, sweaters still lay about the house, the house heat keeps kicking on.
I’ve said it a few times this weekend, and I don’t know if it’s a sign of getting older, but I keep finding myself repeating - “Glad I’m not camping this weekend”. I get why I’m thinking it: lots of camping on the weekends up here on the Delaware River Valley, and it’s been chilly, and wet, so less than optimal for an activity that can counterintuitively raise the stress levels rather than reach a state of ‘nature calm’ - let’s just take everyone out of their element, give them poor wifi, substandard shelter, damp clothes, and a lot of new skills to learn and have a great weekend. I don’t know why I’m thinking about camping, and the near miss of not camping this weekend, since I don’t really camp. Maybe I’ve camped 20 times in my 40 years of camping age range.
My new project on my property, the pickleball court, is on the home stretch (not to mix sports analogies). Garden is planted, pool is up and running, yard is dethatched and green, garage cleaned out, and the big landscaped bed weeded.
Found this 1972 classic while organizing my garage.
I’ve ruminated before, I don’t think on these pages, but before in my mind, about the unfairness of the tax system when it comes to single earners rather than married filing jointly. Sure, when both adults are working, and the household income is higher because of it, sure, that makes sense to offer a higher level income for certain tax rates and breaks. But there’s lots of situations in modern family life where a single earner has a family, has all the expenses of a household, and the tax code treats them as if life is cheaper as a single, which is hardly the case. In fact, in many situations, spreading the costs of running a household over 1 person is more expensive than for more than one. There are economies of scale to everything from dinner prep to laundry to heating the house.
For instance, I own a home, raise a kid, have 2 cars, a pet, and everything else that one needs to run a household including utilities, insurance, house maintenance, etc..., there’s only one income, I’m not married, and I’m taxed like somehow my life is cheaper to operate than a married couple. Seems to me there should be a caveat in there somewhere - like if only one person works in a married arrangement, why should they get dual income credits? Currently a married household gets a ceiling of $500k for joint filers and a single person $250k. That $250k difference results in $80k more taxes withheld for the single person household.
And similarly for single earners, if they have kids, or own a house, or some other real expense criteria, you should get the lower tax rates (or more accurately, higher income level ceilings). It should be less about your marriage status, and more about your life obligations - like does your mortgage, real estate taxes, child/support and alimony, and perhaps a few other inputs add up to a certain percentage, and if so, you get a higher ceiling. I already see a few flaws in my plan, but the tax code is complicated so I’m sure they could figure it out. Also seems unfair that high costs states and areas get the same federal ceilings as low cost states, since it’s hardly unfair to argue that $200k in Kansas is a lot different than $200k in Boston. Seems unfair that single-earner households - arguably operating on less stable footings than a dual income family since any inability of the single earner immediately threatens the whole structure -seems unfair at the assumption that running a life as a single person is 50% cheaper than as a married couple. Though who knows - maybe when the idea was introduced, it was thought to be a motivator to get married?
Our house we are building in Parksville.
The SALT tax debate at the federal level has been interesting to watch, as Mid-Atlantic states, particularly NJ, NY, CT and MA, dig in to restore a higher deductibility of state and local taxes from federal tax obligations. With real estate tax bills easily reaching $20k or a lot more in many places, the limit of $10,000 passed in 2017 was a real and true financial blow to many families. Sure, many could afford it, but many affluent families live far beyond their means, so a new $10k, 20k, $50k tax can be a big deal. $45k in real estate taxes deducted off your fed return - here’s the math - $45k deduction, 37% tax bracket - was a real $20k tax savings, but at $10k cap, is now a $4k tax savings. A $16k out of pocket swing. Chump change to some, a real hit to others as that amount is 2 car payments, 50% of room and board, the cost of raising a kid for a year. So anyways, they are holding up the big beautiful spending bill because of this issue, and I’m really not surprised - it was a big deal when it was passed, and it’s a big deal now.
New long overdue railing heading down to the pool -
Turns out for ‘pass-thru entity’ people - those with C corps, S corps, LLC’s etc - the law in 2017 introduced a lot of changes, but when push came to shove, there were new loopholes -intentional or not no one really knows - that resulted in my tax bill (nearing 40-45% for the majority of my income) more or less the same - calculated a lot different with credits and debits being pulled from new places, but in the end, about the same owed. The same can’t be said for W2 workers, or those without the flexibility of business deductions - the W2 workers, as always the case, have nowhere to hide from tax code changes.
It’s been raining but we keep cooking along, with 4 homes under construction and moving at a quick pace. Being less busy, and being highly skilled at my job, I’ve found my tangible effectiveness notching upwards - I mean, I’m always pretty effective, but when you are drinking through the fire hose of productivity challenges cause you are building a dozen houses at a time, the effectiveness gets watered down if only because there are more problems to solve, your time to solve them remains the same, so your effort and attention per problem is reduced. Allowing time to zero in and dedicate the time to each, leveraging a lot of knowledge and experience, makes most problem fixes a lot more certain.
A few examples of sticky situations that only good and effective strategy and communications can counter - Alps Airbnb host trying to charge us $2k for a cracked picture window, local electric company asking me to come 2 miles for electric service rather than tapping the transformer 200 yards away, a few employment related matters were resolved in my favor, a successful appeal of the assessment levels of my homes in Fremont NY saving my families up there a bunch of money on their annual taxes (as well as preserving their resale levels since every dollar in annual real estate taxes is a blow to the ultimate value of a home), - there were a bunch more but I can’t think of them. I think one thing that is happening for sure is I’m just walking away, or quickly resolving, tasks and situations that may have principle at stake, but not business advantage. Letting some of that go can save a lot of mental resources and have the time there just really is no point to chasing the principle - to prove what, to whom, exactly?
I handed out (10) $1250 scholarships for Delaware Valley High School seniors for a scholarship I titled EZ Money - A financial literacy seminar. They had to apply, they had to write an essay and they had to attend a 2 hour seminar I led, which I used up most of my time talking about debt, and how to avoid it. And next Wednesday I present the funds at scholarship night. We had 21 applicants for 10 slots, which the scholarship coordinator at the school thought was pretty awesome especially since of all the strings attached to the award. To me, it speaks to the thirst for real financial guidance that people just don't have access to.
Resales, and the French
It’s a rare Catskill Farms resale property that doesn’t sell quickly, and for full price. The most recent example is a house we designed and built outside Narrowsburg NY overlooking the Delaware River. This modern Ranch, one that I dreamed up to mirror the shape of the bend in the Delaware River it overlooks, is one of the most unique homes in SuCo, if not the Hudson Valley. And priced at $1.5m, with a new studio/garage; a fairer price could not be had for this.
The only reason it is selling for $1.5m instead of $2.9m is because of the affordability of our builds, the vertical integration of our efforts, the efficiency of our program. I think they have less than a million invested in this property, which is just an absurdity on the face of it.
One reason we always live to fight another day is because we are always offering value, which we can do because I know my business and the markets about as well as someone can know these things, learned through lots of effort, lots of study, lots of curiosity and lots of sometimes costly experimentation.
Over and over and over for decades we have built homes, sold homes, had those homes resold, and repeated to the benefit of a wide range of Sullivan County businesses. Needle-moving impacts. Our aggregate macro and micro economic impacts are gigantic and game-changing, not just for the people who reside in the homes, but for the communities in which these homes exist.
I was thinking about the French, and our recent trip to the Alps, and I was remembering the 3 different run-ins I had with some French men - 1, in the cafeteria on top of one of the ski mountains where I was getting some cheese and bread and olives and waiting in line to pay, and someone’s shouting about something but because I don’t speak french I’m not paying much mind but then I realize it’s directed at me and it’s because my plate needs to be weighed to be priced right. Now I was definitely in the inadvertent wrong - frankly never occurred to me - but the cost of a mozzarella stick I’m not sure rose to the level his voice inferred.
The 2nd was on the slopes, when a guy in front of me - and we weren’t going fast, sort of cut me off at low speeds - at the edge of a run, where I was out of horizontal space, and our skis tangle just minorly and I believe he might have quickly fallen and popped right back up, and come up fighting and yelling and pushed me to the ground. I was in the Alps, and I was a bit shocked, so I didn’t have much of a reaction even to the push, but he certainly thought it was the end of the world.
And 3rd, at our ski slope condo, a large picture window had a crack in it, when we arrived, which you just assume everyone knows about, but I guess he didn’t and tried to blame us for it to the tune of nearly $2000. One, it sucks to be blamed for something you didn’t do - it happens all the time in construction where someone you can’t identify did something, and you can either go around blaming everyone, or just eat the cost and preserve the team. This was especially obnoxious because just by accident I snapped a time stamped photo at 5:34pm of the mountain views and that picture happened to capture the crack coincidentally. We had only checked in at 5:15pm - so I get the guy can suspect us since he clearly missed the defect (or more likely, the cleaning company didn’t report it, or actually did it), but with that tight window - we arrive, literally immediately crack the window, and take a picture to prove it was already there - but with that tight window, any self-respecting host has to admit that’s a pretty tight timeline for us to be working under, like the unlikely 3 shots from Oswald’s rifle. Anyway, AirBnb rejected his demand for money after an investigation.
United was responsible for a delayed bag, which forced my wingman Eli to buy head to toe ski gear on the slopes of a famous resort, which I can’t imagine there is a more expensive way to buy ski gear. $1800 of ski jackets, pants, long john, etc…., which United reimbursed with a pretty straight-forward process. I guess maybe first class passengers get better treatment, but even still it was amazingly efficient, communicative and in the end, took full responsibility.
So, I was facing literally $3500 of extra charges, but needled my way through them at no cost.
I’m sort of winning on all these types of fronts these days, with lots of bandwidth to evaluate problems, deploy actions or communications, and swagger towards successful resolution. You can’t do that when you got too much on your plate and don’t have the mature support around you. It’s frankly just too much to ask of even a veteran business-owner. I think it’s a measure of the successful recalibration I’m seeking, that sweet spot of busy - enough to be profitable, not too much to be harried and chained to the stress.
Monday, the little Ranch sells, in Narrowsburg, and that finishes off a 3 house project on Wood Oak Drive. I bought those lots when they came on the market, and my only demand was that I get all 3, even if I have to pay a little more to make it happen, because few people care more about the impact on neighbors than I do, especially if they are my home, but generally also. I've seen so many poorly planned homes that negatively impact, sometimes to a big degree, the peace and value of a neighboring property. Many times, just some consideration, knowledge and spending a little money would have prevented the whole drama.
PanAmerican road trip being planned.
