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Best podcasts about michael well

Latest podcast episodes about michael well

Im Gespräch
Musiker Michael Well - Über Well-Buam, Biermösl Blosn und Well-Brüder

Im Gespräch

Play Episode Listen Later Oct 25, 2024 34:49


Timm, Ulrike www.deutschlandfunkkultur.de, Im Gespräch

The Dental Marketer
Only 1% Failure Rate? Why This May Not Be the Case in Dentistry | Ali Oromchian | MME

The Dental Marketer

Play Episode Listen Later Jun 17, 2024


Have you heard claims like "less than 1% of dental practices fail"? Today we're exploring how that may not be the case! In this episode, I'm sitting down with Ali Oromchian to debunk common myths about the failure rates of practices and uncover the essential strategies that can help you mitigate risks in this challenging field. From the critical importance of due diligence when acquiring a practice to the necessity of robust HR practices, we delve into the nitty-gritty details that can make or break your career. Ali's insights are not just theoretical; they are drawn from real-world experiences and seasoned legal advice.As we navigate through this discussion, Ali emphasizes the transformative power of creating a positive work environment to attract and retain top talent. You'll learn the subtleties of maintaining compliance with ever-evolving legal requirements and avoiding common HR missteps that many practice owners fall victim to. Whether you're just starting or looking to optimize your existing practice, this episode is packed with actionable advice that can help elevate your practice to the next level. Stay tuned until the end to find out how you can get in touch with Ali for personalized guidance and support.What You'll Learn in This Episode:Why the "low failure rate" of dental practices could be a misconception.Key strategies to minimize risks as a practice owner.The importance of thorough due diligence when buying a dental practice.How to establish solid HR practices and stay compliant with legal requirements.The vital role of creating a positive work environment in recruiting top talent.Common HR pitfalls and how to avoid them.Let's learn how to minimize risk and maximize peace of mind in our practices today with, Ali Oromchian!‍‍You can reach out to Ali Oromchian here:HR for Health Website: https://www.hrforhealth.com/ (Don't forget to mention the podcast sent you!)Ali's Website: https://www.dmcounsel.com/Phone: 925-999-8200‍Mentions and Links: Software/Tools:IndeedMonster.comCraigslist‍‍If you want your questions answered on Monday Morning Episodes, ask me on these platforms:My Newsletter: https://thedentalmarketer.lpages.co/newsletter/The Dental Marketer Society Facebook Group: https://www.facebook.com/groups/2031814726927041‍Episode Transcript (Auto-Generated - Please Excuse Errors)‍Michael: Hey Ali, so talk to us. What's one piece of advice you can give us this Monday morning. Ali: All right, Michael, thanks for inviting me on here. You know, I'll tell you, you know, business owners, whenever you talk to these lenders, they always throw this statistic out at you. They say.You know, less than 1 percent of all dental practices, you know, fail. and they, they always throw that out there because they're excited to want you to kind of be energetic And, empower to start your own practice, um, or to buy a practice. but the reality is, is that it's really not 1 percent or less than 1%. you know, there may be very few practices that don't do well, But a lot of people suffer, right? A lot of people suffer. you know, the way to avoid suffering, the way to make the practice ownership kind of process, um, exciting and fulfilling is to limit and minimize your exposure to risk.Right? and so, with that, you know, if you're buying a practice, making sure you're doing all of your due diligence, right? you know, making sure you're looking at. you know, the patient, you know, charts, you know, looking at all the financials, looking at everything that you need to look at from a legal perspective to make sure that you're actually buying what you're buying.if you're doing a startup, you know, making sure that you have a lawyer or someone looking at your leases and making sure that's done well. Um, and then finally, I would say, you know, making sure in either scenario that you have your HR house in order, that you are hiring your employees correctly, you're giving them lunches and breaks when you're supposed to you're giving them overtime when you're supposed to doing all those things that you're supposed to do, you're actually doing from a legal perspective.And, And I think if you do those things, your risks will be minimized, and then you can not suffer. Right. And so, you know, it's a little bit unpopular, but people, people are like, Oh my gosh, less than 1 percent of dentists fail. So let's all go do it. And it's like, yeah, everybody should be in, you know, a practice owner.Absolutely. But I want to prevent you from suffering. Right. And the suffering is when You know, you don't do the right marketing, you don't have the legal, components done well, and then, and then over time you struggle and you grow not as fast as you should, you get sued, you know, you get all those things happen and, that can really impact your happiness and your drive to continue growing the practice and, uh, and, and that's one of the things, Michael, that's been my mission throughout my career has been to help young doctors get empowered to become practice owners.But doing it in a way where their risks are minimized so that they don't have those exposures long term. Michael: Got you. Okay. I like that. So one thing you mentioned is, which we appreciate that, right, the preventing the suffering, right? Because it is true. You can say you're not going to fail, but is it worth the, you know what I mean?All that, man, we've been suffering for like 20 years, 15, 10, five, right? But you mentioned have your house in order. And I know something right now, and maybe you've been seeing this, Ali, where it's like It's hard to maintain or retain those great employees sometimes and then sometimes it's even just hard to find Ali: yeah Michael: team members So what are your thoughts like on that when it comes to suffering in that sense?Ali: Yeah. Oh my gosh I'm, so glad you asked about this because this is like one of those areas that we get so many questions about here's the thing i'll tell you the number one recruiting tool hands down year over year over year Is not indeed. It's not monster. com.It's not Craig's list. It's none of those things. The number one recruiting tool for finding really good employees is your current team, Because guess what? They're going around saying to people. Yeah, because they have friends who are RDAs, DAs, hygienists, you know, whatnot and they're going to them and saying, you know what, I love where I work, you know, you know, my doctor does this and my doctor does that and, and we have so much flexibility in this regard where I get these benefits and then their friends want to join the practice, right?So I always say, It's really important from a recruitment perspective that you create an atmosphere that people want to come and the best way for people to come is by the current team recruiting them in, you know, inviting their friends. And so I always say, talk to your team and say, Hey, if you know anybody that's good, that's looking to change, please invite them in for an interview and whatnot.And you'll be surprised how many people do that if it's a good environment. If it's not a good environment, then they won't. Right. They don't want to do that. They won't invite people to come in and interview and whatnot. So, so I would say from a recruitment perspective, I would focus on that. from a legal perspective, I think, uh, you know, making sure you've got all the basic documents that you need when you're hiring everybody.Uh, you know, making sure you have an employment manual and things of that nature. I think those basics that companies like HR for health provide, I think are, great. You know, and if you do that. then that suffering goes down because the chance of a lawsuit also goes down dramatically. Michael: Well, that's interesting.Where do people normally, in your experience, drop the ball when it comes to the basics? Ali: I think they rely on companies that they shouldn't rely on for their HR. Like, for example, a lot of people will Rely on their payroll company to provide them HR documents. Well, the payroll company is a payroll company, they're going to provide you the basic documents they need for running payroll They're not an HR company, right? So so I think I think that's the first Um, the second is not having an employment manual that's up to date, and I think you know, especially with all the rule changes since covid it's super important to You To have an updated employment manual.Um, and then the third is what's called wage and hour and wage. An hour is something that's a problem nationwide because it's about paying people correctly for overtime, giving lunches at the right time of the day. Giving breaks when you're supposed to, making sure the paychecks are correct, you know, all the, things around the financial side of, payroll, um, that people make mistakes on.So, I think if you do those three things, and you do them well, you're well on your way. Michael: Ali: for health from a HR perspective. We'll make sure your hands down compliant from A to Z a hundred percent. Michael: Okay. Wow. That's amazing, man. I know you guys have a software too.Is that true? Ali: so HR4L is a SaaS based software, so it's all online, you know, the employees, you know, clock in and clock out, they sign things electronically, so everything's very sort of streamlined. Michael: Do you guys ever, if I needed like a person, you know what I mean? Like, can I need a consultant to talk about this type of like compliancy or something's happening a unique situation, right?Do you guys have that too? Ali: Yeah, absolutely. Yeah. Yeah, we have a unlimited hr support actually, where they can be on the phone Uh with some one of our you know, hr experts at any time of the day Uh, really all day long, um and as many times as they need if for some reason they can't answer it then it goes one level higher to lawyers And depending on where they are in the country, they'll either be talking to, you know, our firm and someone like me or a friendly firm that does a lot of HR.but either way, you know, we take care. Michael: Yeah. Cause I know that's super important, Ali. I feel like sometimes maybe you might've seen this. We ask questions like on a forum, right? Like dental town or Facebook groups and things like that. Yeah. And people give their advice and opinions, but it's a different state.Right. Different rules, different things. And so like maternity leave, right. Or when it comes to, I don't know, like, depending on should we pay them for, lunch and learn, right. Kind of things like that. And so do you see that a lot? Ali: I do. Yeah. People, I like to think that people are good intention, Michael.And so when they go on these, uh, blogs and whatnot, whether it's Facebook groups or it's, uh, you know, like using like dental town or other things that they contribute. Because they want to be helpful, right? And they're using their own base of knowledge, but you hit it on the head. I mean, I can't tell you how many times somebody has given advice to someone else without even knowing what state they're in, you know, and if you don't know what state they're in, then you, how can you advise on any of these rules? But what people are doing is they're giving their own personal advice based on their experience, which may not be right. And what's scary is we see it sometimes where somebody takes that advice, And does something with it and then they get in trouble because it was the wrong advice, you know, and this, this happened actually recently where, you know, a young doctor coming out of school on the practice for a few years and, uh, hadn't been paying their, uh, assistance minimum wage.They weren't paying the minimum wage in the state that they were in. Why? Because they had gone on one of these groups and asked the question and the person replied with the minimum wage in their state, not in this person's state. and what's even worse, and you'll, you'll laugh at this. The payroll company that was running their payroll didn't even tell them, right? Wouldn't you think, Michael, that if you're using a payroll service and you're paying someone below state law in terms of minimum wage, they would tell you what that is? I mean, it's just like crazy. And they didn't, they didn't. And of course, You know, the employees got upset, and, uh, when they found out and it's funny because they went like almost a year, almost a whole year, like nine months without saying a word.And then that January, the law changed and, the minimum wage increased. And then the employees saw it in the news and they were like, Wait a second, like I'm being paid 14. 25. It says minimum wage went up to 16 from 15 like something like what the hell just happened, you know? Yeah, yeah.And so, so like it was a disaster, but that's what I mean by, you know, payroll companies are not HR companies. And there's so many ways of, doing this wrong. And, and remember what we were talking about in the beginning about suffering, like how bad does that doctor feel? Yeah. Right. Right. It's not like, I mean, you know, you work with doctors all the time.They're not trying to steal from employees. They're not trying to not pay them the minimum of what they, but they just make mistakes and like, it's just, you know, that's the suffering that I want to avoid. Michael: Yeah, that you want doctors to avoid. Awesome. Holly. I appreciate your time. If anyone has further questions or concerns, where can they find you?Ali: you can just go to our website if you'd like. It's, uh, d m council. com C O U N S E L. Uh, or you can call the office at 9 Um, and of course, if you just Google my name, you know, I'm everywhere. And so you guys can find me there so Michael: awesome. So that's going to be in the show notes below. If you guys want to.Go in the show notes below and check out and ask and pick Ollie's brain a little bit more. Right? Ask him any questions or concerns about this. So awesome, Ollie. Thank you so much for being with me on this Monday morning episode. Ali: Thanks, Michael. I appreciate it.‍

THE WONDER: Science-Based Paganism
Suntree Retreat 2024

THE WONDER: Science-Based Paganism

Play Episode Listen Later May 28, 2024 38:56


https://theapsocietyorg.wordpress.com/news-and-events/suntree-retreat-2024/   Episode from 2022 Suntree: https://thewonderpodcast.podbean.com/e/live-from-suntree-retreat/   ----more----     Mark: Welcome back to The Wonder, Science Based Paganism. I'm your host, Mark, Yucca: And I'm Yucca. Mark: and today we have a really exciting group of people to talk about a really exciting upcoming event, which is the Sun Tree Retreat, which is the second of these retreats that we've held in person for atheopagans from all over the world who can come. Held in Colorado Springs, Colorado, and it's going to be over Labor Day weekend this summer. So, I'd like to introduce our two panelists here, who were at the last one Rana and Michael. Michael: Hello. Yucca: Rana, we Mark: I can't hear you at all. Rana: Oh, thank you for having us. Yucca: Welcome. And I think both of you've been on the podcast before, right? So, welcome back. Michael: Oh, thanks. Can Yucca: Yeah. Michael: put that Yucca: So let's, let's start with the, some of the details because that's coming up really soon, right? That's Mark: It is, Yucca: two months, which is not very long. Mark: nope, not very long, especially if you have to get plane tickets and that kind of thing, so, Really encourage folks that want to go to get registered and get organized around it, because it's going to be a really good time. So, details. The event is August 30th, which is a Friday starting in the afternoon through noon ish or one o'clock or so 2nd. Registration includes nine meals. As a part of your, your registration fee you also need to register for lodging, which is very affordable and you can find all the information about it by going to the Athe O Pagan Society website, which is the ap society.org, THE ap society.org, Yucca: And the lodging has several diff oh, Michael: notes as well for this Yucca: absolutely, yeah, we'll put that in the show notes so that people can just go ahead and click on it. I was gonna say the lodging has several different options including tent camping, and yurt and Mark: guest house, you're. Yucca: I think it's dry camping, but you could, if you have an RV and you're in the area, you can do an RV too, is that correct? Mark: Yes, there are no hookups, but but there is parking for RVs. We had a couple of people, at least one couple came last time, actually in a school bus, Yucca: was really cool. Mark: was converted. It was really cool. Yucca: Yeah, Mark: So, Michael and Rana we wanted to talk some about why this event was so cool last time and what we're looking forward to going into this next one at the end of this summer. So why don't we start with kind of golden moments. Michael, you want to go ahead? Michael: I wanted to just say beforehand, you mentioned the meals, and one of the high points of it was the options available. Like, every dietary requirement was accommodated, I think. Mark: Yeah, Michael: The catering team there are fantastic, and I think people shouldn't feel concerned about food at all because the options were great the food was really high quality I think everybody felt really good about the food, so that was an important, that was a real high point so just wanted to make sure we got that mentioned. And, Mark: Yeah, great. Thank you. And, and eating together was really a high point for me. Just sitting down for meals, you know, they had these round tables that I think seated eight or ten or something like that, and different combinations of people would sit together for different meals. And so we got to know one another better in those mealtimes. So that was a high point for me. Somebody want to go with another cool thing that they remember from Suntree in 2022? Yucca: well, I remember Robin led these I'm not sure what you would really call it,  Rana: yeah, the meal acknowledgement. We have talked about them in the group, but it was really different being able to experience it together. And it was things like bringing to mind the history of our food or thinking about the systems that brought it to us today or the hands that it passed through. And we've had some discussion in Mihal's full moon. We were doing like a full moon lunch thing for a little while as well where we kind of continued that conversation and, and thinking about that, which is something that I find really enriching and really enjoy. Also want to strongly second the dietary accommodations that they had. I really, really appreciate it because I have a little bit of an odd diet and I felt. Really good and definitely did not lack for good options for food. Mark: Mihal, you want to go? Michael: yeah, what I found really interesting about the, The whole experience was how quickly we created a community in space particularly when we did our Fire Circle get togethers. And the kind of spontaneous sharing that occurred at those events was really amazing. People really just suddenly kind of created this family. in situ and it was it was great to be part of that. Just sometimes if you go to other kind of retreats it can take a while to kind of break down those those barriers we put up. Just as just as being human but it seemed within a just a few hours we'd kind of already started to create a special Sun Tree community and I thought that was fantastic. Mark: Yeah, I really agree with that. I mean, I've been to a whole lot of various kinds of pagan gatherings and retreats of various sorts. And it seemed as though we just kind of got at this visceral level that we were among, you know, people that were of like mind and similar values. And so that we were safe. Right? We were all, we were all going to play nice with one another, and so we could talk about really deep stuff in our, in our lives, and in our, our experience. And I found that really moving throughout the whole long weekend. It was, it was, it came up over and over again. Yucca: I was also really struck just by the immediate level of respect and consent that was just part of the, Everybody had going in. So I had my five year old with me and in a lot of situations in our culture, people you know, will go up and touch five year old's heads and give them hugs and, you know, all of those sorts of things. And I remember it just being great because people automatically were so great with her about asking for her permission. Like, do you want a hug? And would you like to shake hands? And that was just the culture of it. And it was just so refreshing and wonderful to just be in that space, just from the get go. Like Mark: and I mean, we had, we had laid out guidelines around consent and around conduct because, you know, we wanted to be very clear about, you know, what the expectations are, but it seemed like people read them and were like, yeah, that's civilized behavior. That's how I'm going to be. And the subject Honestly, never came up. There was never a situation where somebody felt like they had been inappropriately touched or or somehow invaded in that kind of way. And I thought that was, that was really pretty amazing. Michael: I just wanted to talk about the actual place as well. The Retreat Center is Really, really phenomenal. There's this beautiful forest. You're kind of just on the edge of Colorado Springs, so it's not too far from any stores or anything that you might need. But once you get in there, you suddenly feel like The outside world has disappeared just in this beautiful forest really a fantastic place just to go for walks just to go into the forest by yourself if you want to go for I think one of the big highlights was that we had a lunar eclipse while we were, while we were there, and being able to all, for the whole, all of us to go out there onto this big lawn and just stare up at the, at the moon together, and people howling at the moon, it was It was just a really fantastic experience as well especially just having that, we, we had the the Ponderosa Lodge, which is this big log cabin lodge that we can use for a lot of our activities, for rituals, and for our workshops. And that's a real, that's, that's a really nice space as well, there are different rooms, so you can kind of break off and do different things with people, or you can kind of come to the main room and have a bigger discussion. We had dance parties there, we had the Carnival of Change, which was a chance to kind of take on a different persona, like dress up. be a different version of yourself for the evening. So I think the whole, the whole retreat center just kind of facilitates that. There's a, there's a labyrinth there as well, which we didn't really incorporate too much into any rituals the last time around, but I think we're going to try and bring that in more this time around. Mark: Yeah, it's a beautiful spot. Rano? Rana: Yeah, the, the shared experience of the lunar eclipse was pretty special and it, it just so perfectly aligned with what we were doing. It was the same night as the Carnival of Change and it just felt like great, like the weather cooperated and we got to see this cool celestial event. It wasn't even at a super late time, like it was, it felt like a Yucca: like eight or nine. Yeah, Rana: Yeah, yeah, it felt like started our evening, kind of, or, you know, it didn't, it wasn't, you know, too far on late night or anything. The Carnival of Change itself was really fun, just to be able to play dress up together and listen to some music and, and just have fun. And I also like, like Michael said being able to split off into other little rooms and areas. It And I think for me, something that I really appreciated was the ability to have these just kind of unplanned moments where so much of our online interactions are very scheduled and it, you just show up at a certain time and there's a group of people and that's kind of mostly how it's gone. But, like, I just remember some folks were up later one night just all chatting and hanging out. And I love that feeling of if you're up late and feeling a little bit chatty or sociable, you can just kind of see who's up and just take a seat and hang out for a bit. And that's something that otherwise has felt like not really something we have access to. So it was particularly nice just to be able to connect in a more organic way, depending on how you're feeling. Mark: hmm. Yeah. Nihal? Michael: Yeah I think we, there was a lot of, there's been some learnings from that event as well, and I think there, we were really concerned about accessibility this time around, because there was a lot of movement between different areas. And so this time around we are definitely going to be making it more accessible as well. There's going to be designated drivers, so we want to make sure that everybody feels comfortable and everybody's able to take part in all the different events that we're having. So, I, I know that there's going to be a lot of more accessibility this time around, especially just in terms of shuttling people around the property. Yucca: Because there were a few hills and we were moving from the bottom of the hill back up to the dining room and then back down. Michael: Yes, yes, yeah, but I think we, Mark: and we were at 7, 000 feet. Michael: that was another, yeah  Mark: yeah one of the things that we learned from the Sun Tree Retreat in 2022 is that we had programmed a lot of the time, but some of the most memorable and wonderful moments were the unscripted times. The, the, The break periods when we could just gather together and socialize, or plan what we wanted to do for a rite of passage during the rite of passage period that we had later on, which was one of the most moving things to me. That was really an experience. So this time we've programmed in more free time. There's still plenty of workshops and, and rituals and experiences to have, but we've made it a little bit looser so that people have opportunities just to hang out and experience the place and one another. Michael: yeah, yeah, I just wanted to I might talk about the rites of passage a bit more because that was quite a unique experience. I guess we didn't really know how that was going to go because it's kind of like, it's a make your own ritual event, basically. You, you just DIY it with some help from some friends. So I think people were, they had various things that they wanted to celebrate or commemorate and or mark the end of a period in their life, or the start of a period in their life. And we all came together and celebrated those those events together. And I think what was really amazing was just the creativity that people brought to their rituals. Really very moving and even though they were very personal, I felt that We all kind of, as a community, came together and it became something for all of us. Mark: Yeah. I felt so included in all of those rituals. I felt like my being there mattered. And even if just as a witness and that. You know, that there was room for everyone to have the kind of experience that they wanted to have. And it, and we, we ended the rites of passage with a wedding, which was sweet. It's kind of, you know, the classic act four of the movie, right? And that was really lovely. So, I was, I was super happy with that, and we're doing that rites of passage process again this summer. Michael: Maybe we could talk about some of the workshops that took, that people liked. Mark: Oh, yeah. Michael: I really, I think one of the highlights was the Cosmala workshop, bead workshop, which is basically making a bead necklace that, with each bead representing an important part of, in the life of the universe, or in your own personal life, or just various different events that you want to commemorate. That's, that's kind of right, isn't it? Or was there any Mark: John Cleland Host, who is our friend and a real innovator in the whole realm of naturalistic paganism, one of the earliest people to write about it in its new resurgence. He has this amazing more than a hundred bead string. Of, that all, it starts with the Big Bang and it works all the way until, at least until the Sun Tree Retreat, because he had special beads made for the Sun Tree Retreat that he distributed to people so they could put them on their own cosmola. That was very, very cool. And some of them are signed by people like Starhawk and Jane Goodall and just really a fascinating, wonderful ritual tool and evocative piece of art. Yucca: so there were a lot of different styles of workshops too. There was a, like a history one and there was a John did another one which was like the Wheel of the Year, which he had some really cool handouts for too for that. Mark: We live the year for families, which I thought was really wonderful. You know, a lot of people in our community have families that they're working to build traditions with together, and so, and John has really, you know, pioneered some of that, you know, working with his, with his wife and his sons. And just had a lot of great ideas about different things he could do at different times of the year and was, you know, freely sharing all that stuff. It was great. Rana: There was also a group guided meditation that we did outside overlooking Pikes Peak on their big, expansive, beautiful lawn with all the ponderosa pines, which I'd never, I don't think I'd ever seen them before. I'd never been to Colorado before. And that was really lovely just to kind of take a moment to be there and be present. And there was also a body painting. Which, I appreciated the, like, especially interactive stuff because it's something we're normally restricted about online. And I really loved Mihal's presentation about virtual meals because I think food is just such an integral way to connect with other people and you can infuse it with all this symbolism. And it gave me a lot of ideas. I need to revisit my notes on that and thinking forward to the next one a little bit too, just that ability to share food and those meal acknowledgements really adds to that feeling of making meaning with other people and making community. Michael: Yeah, we had a food altar as well, which was kind of cool. An abundance of food. People brought stuff to share. And I thought that was fantastic as well. Just, uh, one, one person brought some really good kimbap, which I love. So that, if you don't know what that is, it's Korean sushi, basically. And it was just really good. Mark: Yeah, there, there was there was just a vibe of generosity and mutual support. Mutual affirmation. You know, I came away from it feeling like, you know, I've got these amazing, super cool people in my world, and they feel the same about me, and that's just good for my life, generally. Even if I'm not going to see them for a couple of years, except online, just knowing that we shared this experience together just helps me to feel affirmed in who I am and what I do. And I, I, I think I think that was the general vibe that people got out of the event. Yucca: That certainly was, I felt that strongly as well. I was, you know, riding that for several weeks after coming home. Michael: Definitely an afterglow of, kind of like, hard to come down from the high of the event as well. It took a while because it was so special. Mark: yeah, absolutely. So we want to talk a little bit about some of the offerings we're going to have this time. Some of them are repeats from last time, but some of them are new. Let me see if I can pick one. Oh, go ahead. Michael: I was just going to say, maybe everybody's had a chance to look at the program and if you, if there's any particular highlights you want to, that you'd like to talk about that maybe you're looking forward to. Mark: There's so many things. Um,  Michael: Well, should we talk, let's talk about the theme first. Mark: sure, of course. That's a great Michael: we didn't, we didn't have a theme last time, but we do have a theme this, this time. Mark: Which is Solarpunk, a chosen family reunion. The idea being that Solarpunk being a very kind of optimistic movement for the betterment of the world, the betterment of our relationship with nature rather than kind of the doom and gloom that we, that we see everywhere around us now, Solarpunk is a, It's a genre of of writing and of art that is optimistic and looks to the future as, yes, filled with challenges, but also filled with opportunities for us to grow and change and do better. And the chosen family reunion part is I mean, I certainly felt and I think that a lot of us felt at the last Sun Tree Retreat that these, these people were my chosen family. It was, it felt like, oh, wow, all my cousins and uncles and, and nephews and nieces have all shown up and now we're having this great sort of family hoopla together. It was, it was great that way. Yucca: And one of the workshops is going to be on solar punk and atheopaganism more specifically, right? That's Mark: yeah. Michael: Yeah, Hanna is going to be leading that one. Mark: Mm hmm. I'm looking forward to that one as well. And of course we'll have some some elements that will be around, you know, learning how to organize rituals or to you know, to design them. Or you know, kind of learning the observational skills about getting more in touch with the processes of nature around you. Mm hmm. That was something about the, the lunar eclipse last time that it really dovetailed with something that, that Yucca and I talk about on here all the time, which is just about, you know, paying attention, about being present and experiencing the moment and observing what's happening in nature, and That was such a dramatic event. It really, really riveted our attention for about an hour or so. Michael: We're bringing back the Cosmala again, because that was so popular, and I think, I'm sure that new people are going to want to try their hand at making Cosmolas. Mark: I've never made one. I, I'm, it's an oversight. I have to do it now. Going to do a reader's theater. I'm organizing that of a reworking of the myth of Hades and Persephone and Demeter in Greek mythology. Because, even though that's a very popular myth in pagan, kind of modern pagan circles and a lot of different groups have done reenactments of the Eleusinian mysteries that enact that story, it's a pretty terrible story, really. I mean, Hades, Hades captures the innocent daughter Kore, drags her away and makes her his wife. That's terrible. Not so cool in modern, Yucca: way of putting it, Mark: yes, that is a very polite way of putting it, yeah. So, so I rewrote it. I rewrote it to have a different kind of ending and a different set of teachings than the original story did. And we're going to do a reader's theater where people who come to the workshop can pick up a script and take a part and we'll all read it together. And and it'll be fun and hopefully people will enjoy it. So that's another thing we're going to do. Michael: Yeah, we've occasionally done death cafes online which are kind of opportunities to talk about death and, you know, I think our movement's kind of a death positive movement, and we want to kind of honor that, and so something I'm going to be leading is an Irish wake kind of experience, and, you know, at an Irish wake, it's not just mourning the dead, it's kind of celebrating life. And kind of celebrating chaos and causing mayhem. So we're gonna have we're gonna have a bit of an Irish wake experience and I'm, people are gonna be invited to bury the things they want to bury, or remember the things they want to remember. And then we will also cause some mischief as well. Mark: Sounds great. I'm up for all of that. Yucca: And on Saturday, at lunchtime, we're planning to do the same thing that we did last time. to do a live podcast episode, and that may be an opportunity for folks who can't attend in person to zoom in and connect. Yes, Mark: Yes, cross, cross your fingers for the internet connection at the Retreat Center. Yucca: that's why we say May, we're going to try really hard, technology willing, right, Rana? Rana: So, the last time we had Sun Tree, we hadn't yet started our adult salon. Which we recently rebranded as Adult Forum, and I'm really excited to be able to have that in person for the very first time. I've really valued it as a space to connect and share resources and share a little bit about our experiences and our lives. And for folks that might not be as familiar with what it is, it is a peer support space to discuss adult topics openly, and it is, we consider it kind of semi structured. We usually start with a topic just as a starting point of conversation, and then we let things naturally flow depending on what the participants want to talk about, what's on their minds, can go through multiple topics in one session. It is a confidential and non judgmental setting where we're really there to learn from each other's experiences, share our knowledge, especially if you have a range of ages. There's folks that have just lived different lives or experiences that may have things to share feel less alone. In a lot of things that we encounter in life I know. There's a real epidemic of loneliness, especially in America, and it's something I always have felt really deeply about, but don't really know what to do about it, so I appreciate being able to be a part of this space and have this space together in order to continue that kind of connection and We're going to have a way for people to anonymously submit topics or questions while we're at the event so that the people that are there attending are really crafting what it is that we want to talk about and the topics have really ranged in the past and included things like money, relationship styles, aging, death, altered states, sexuality, and more and Yeah, I've just been really looking forward to it. It is an 18 plus event, and I just, I can't wait to have that in, in person. I think it'll be a great version of it, just because we've always had it remote. Mark: Yeah. Michael? Michael: I know there's one of the FAQs we get around this is that you know, is it going to be recorded? Am I going to be able to participate online? And unfortunately, no, it's just for some of the reasons we discussed. First of all, technology, it's not always reliable, so we can't really do live stuff. I think it's possible that some of the workshops will be recorded. That depends on the presenter. And, but we don't want to, we want to also, honor people's confidentiality as well. So it's possible that we can record some of them, but maybe some of them won't be recorded. But that's why we also offer our totally online conference every other year as well. So if you can't make it in person to SunTree, we will be doing our web weaving online conference next year. So that is just a way of bridging that gap where if you can't make it in person, there is still an online space for you to take part in. Mark: Right. Right. And I, and I should point out the adult forum will not be recorded. It's, it's a totally confidential, just live action space for people to, to have discussions about sensitive stuff. So you needn't worry that you're going to find yourself on the internet talking about personal things. Yucca: Right, and for any of the presenters who do choose to have their, their presentation recorded, it would just be of them, not of the audience. So there'll be the private, privacy for the folks in the audience. Mark: Yeah, because, I mean, there are, in our community, there are people who are You know, in various stages of outness in relation to their non theist atheopaganism, right? Some are out as atheists, but not necessarily the pagan part. Some are completely solitary in, in their You know, practice of their path, and we want to be respectful of all of that. So, it's really important to us that people be able to participate without endangering something that, that is important to them. Mijo? Michael: Something that's New this time around, as well, is that we will be kind of having formal vendors. I will be sharing a sign up sheet for people in the coming days, where you, if you want to, if you've got anything you want to sell, or products or services we will have a space for you to do that. So, if you're, it could be anything, you could be selling, selling your own craft, or, I guess, doing Readings or things like this. We'll just sign up and we'll we'll reach out to you if we need, if we have any further questions about the kind of stuff you're going to be sharing with us. Mark: We should say, though, that, that the vending is going to be during a particular window of time at the event, because what we don't want is for a vendor to be there stuck behind a counter, and for the entire event and unable to participate in the various activities, right? Because they're part of the community and we want them in with us doing all the stuff. So we're going to have a marketplace slot in the program, and that's when you can do your vending and, you know, promote your services and all that kind of stuff. So what else should we say about this? I mean, we know because we've been there, it's really cool. Hope that our listeners Yucca: to just put that out there for that part of the world. It's a nice warm time of year. Last time Michael: Will the swimming pool, Yucca: May, which was a little bit iffy, we got really lucky. last Mark: we did. Yucca: I think it started snowing right after we left, Mark: Yeah, something like three days afterwards it started snowing at the retreat center, but that's not going to happen this time, because we're on Labor Day weekend and it should be pretty temperate and nice. Michael: I think there's a swimming pool there as well. Mark: Oh, that's right, it was closed when we were there before, but there is a swimming pool there. Yes, Michael: We should double check if we have access to that, but I think we will, but we should probably double check that. Mark: yes, that's true. Ha ha ha! Michael: I guess you should definitely get booked in quickly if you are intending to come. Because we're, it's coming up fast. I can't believe it's only two months away, so you really need to start thinking about getting your, making your way there and booking your tickets. Mark: Yeah, yeah it's very affordable especially when you consider that it includes nine meals and the lodging for the, the Yurt guest houses is only 75 for the entire event. So it's you know, we, we, we set price points low because we wanted people to be able to access it and we know that there are travel expenses associated. We if you, if you want to come, but there are, you know, financial issues, we have limited scholarship support, so please contact us. You can use the the Wonder Podcast queues at gmail. com, podcast email address to contact us, and we'll get back to you about that. But we'd really encourage our listeners, you know, if you like what you've been hearing on this podcast for the last five years now come and, come and meet us. Come and, and, you know, meet the community and, and check us out. Michael: It was just, I don't know if I expressed how Amazing it was, but it was just such a unique, a singular event and kind of a highlight of my life, I'd really say. It was just spectacular, and I don't know if I, I don't know if I captured that before, but I just thought it was just an amazing thing to be part of. And I think it's going to be just as amazing this time around. Mark: Me too. Yeah. I, I, I can't wait to see you all. And and other folks that, you know, I met two years ago. I'm just, I'm so looking forward to it rana, I Rana: so for me, it, it really felt like coming full circle, like I'd connected with you all, and we spent so much time together during the pandemic. so much. My personal life was also going through some transition and Suntree was actually pretty emotional for me. It was good But I don't know it's a little hard to explain But it just felt like I did a lot of emotional processing while I was there But I very much felt like I was in community I was able to finally meet these people that I had connected with and So now it just feels like I have something to look forward to You going forward knowing that we're gonna do this with some regularity. And for myself as well, it also gave me some more confidence traveling alone because I'm used to traveling with a partner if I go somewhere, especially airplane travel. And so it helped me feel a little bit more adventurous and confident feeling like I went to a state I've never been to before and met up with some people and everything went great. Like, no, no complaints. Mark: really felt that same sense of just really being able to be myself. And I was surprised by that because as one of the organizers last time, I thought I was kind of going to have to be on and sort of be a host. You know, for the whole weekend. And that really wasn't the case at all. I, I, I just felt like, you know, I was, I was welcomed there, warts and all, and there were plenty of other people to help. And it was great. It was just really a good, good time. Well, listen, thank you. Oh, Michael: Hopefully we can do the, the firewalking this time, because last time we couldn't do it because there was a burn ban, but there is potential for doing a firework walk. So people are into that, that might be available. So we'll see what happens. Yucca: Keep our fingers crossed. Mark: that would be exciting. I've never done that, and I'd like to try it. I don't know why I'd like to try it. I, but I would. Michael: That's the ultimate ritual, I guess. And for anybody who's kind of, their ears are pricking up when they hear that the person leading that has got decades of experience. Mark: Yeah. And, you know, very, very careful rules around, you know, everybody having to be absolutely sober, you know, being, you know, a lot of focus, doing this in a really sacred kind of container, so that's that's That's all to the good. Let me see. So, we're gonna put the link to the the event in the show notes. You can go, you can read the program, you can read about the event, you can see a picture of the Ponderosa Lodge and Atheopagan Society website, there's also a gallery of photos that were taken at the last Suntree retreat. So you can take a look at that.  Michael: Could you add in the show notes as well? Could you add the episode we actually recorded? Yucca: Oh yeah, let's link to that because we, yeah, that would be nice to go back and listen to actually. And what was it like in the moment? So that'll be in the show notes too. Mark: yeah, yeah, I just, I just remember we're sitting there and we're talking and people would cruise up to the table glowing and sit down in front of the microphone for a little while and talk about the experience they were having and then toddle off and somebody else would come by. It was just, it was lovely. So listen, folks Sun Tree Retreat, you don't want to miss it. Please come join us, visit with us. We, we would so love to see you. And we will be back next week with another episode of The Wonders of Science Based Paganism. Thank you, Rana and Michael. Thank you for being here. Michael: Thank you.   

Candid Conversations with Jonathan Youssef
Episode 249: Recovering Our Sanity: How the Fear of God Conquers the Fears That Divide Us: Dr. Michael Horton

Candid Conversations with Jonathan Youssef

Play Episode Listen Later May 14, 2024 41:15


In this profound episode, Jonathan is joined by esteemed theologian and author Michael Horton to discuss his latest book, "Recovering Our Sanity: How the Fear of God Conquers the Fears that Divide Us." In a world teetering on the brink of chaos—from unsettling politics to the lingering effects of the global pandemic—Horton's book offers not a typical self-help guide but a deep theological exploration of how a proper fear of God can liberate us from our myriad earthly fears.Dr. Horton, Professor of Theology and Apologetics at Westminster Seminary, explains what it truly means to fear God—both biblically and theologically—and how this reverential fear can effectively drive out fears of the future, others, and even death itself.Throughout the episode, Dr. Horton discusses the different types of fears that plague our society—from cultural anxieties to personal struggles—and how these stem from a lack of genuine fear of God. He emphasizes confronting our earthly fears with the hope found in Christ, rooted in the Gospel, and the shift from self-preservation to a Christ-focused life.This episode is a humbling, thought-provoking, and hope-igniting journey that challenges listeners to replace false securities with the profound joy of knowing Christ, who commands us, "Do not be afraid." Join us as we explore how cultivating a healthy fear of God can recover our sanity in these turbulent times.To ask Jonathan a question or connect with the Candid community, visit https://LTW.org/CandidFacebook: https://www.facebook.com/candidpodInstagram: https://www.instagram.com/candidpodTwitter: https://twitter.com/thecandidpodTRANSCRIPT:This transcript recounts Candid Conversations with Jonathan Youssef Episode 249: Recovering Our Sanity: How the Fear of God Conquers the Fears That Divide Us: Michael Horton.  [00:01] Jonathan: My very special guest is Mike Horton. He is a professor of systematic theology and apologetics at Westminster Seminary in California, and he is the author of many books, including The Christian Faith Ordinary and Core Christianity. He also hosts the White Horse Inn radio program. He lives with his wife, Lisa, and their four children in Escondido, California, and it looks like he's on his back patio,  having a conversation with me and being very gracious with his time. Mike Horton, thank you so much for taking the time to be on Candid Conversations.[00:45] Michael: Thank you, Jonathan.[00:50] Jonathan: I do thank you for your time. Now Mike, I've read your books, I have subscribed and I do recommend all of our listeners subscribe to the White Horse Inn. If you could just give us a quick, whirlwind tour of your story, we can talk a little bit about the podcast and some of your books as we progress through the interview.[01:19] Michael: Well, thank you, Jonathan. Yeah, I was raised in a Christian home and came to understand the doctrines of grace partly through my older brother. Kind of had my own little, not little, my own Romans revolution and then started digging deeper into Church history and theology and biblical studies, and eventually went to Biola University, Westminster California, then to Oxford for doctoral studies and then post-doc at Yale and came back to teach at my alma mater and have been here for 25 years. Blessed to be able to have a hand, with my colleagues, in training pastors; pastors training pastors.[02:17] Jonathan: I've been a recipient of many of the students of Westminster Seminary who taught me at Reformed Theological Seminary in Atlanta, and I've been really blessed by your work. You've got a very jovial, friendly, California vibe to you, but when you speak, you're like a double-edged sword. It's so penetrating. And I think there could be a theological issue that I've been struggling with for months and you'll say it so concisely in a few sentences, and I'll think, Where was that when I needed that?[03:09] Michael: You're too kind. Thank you.[03:11] Jonathan: Tell us a little bit about the White Horse Inn. It has been on for something like thirty years.[03:17] Michael: Yeah, thirty-plus, almost thirty-five years now. It has been such a fun thing. I've learned so much from my colleagues on the program. I still learn from the new team. We produce a magazine, too, Modern Reformation Magazine, which is really—I encourage people to subscribe to that. It's a good digest of topical theology related to culture. The umbrella organization is called Sola Media, and one of the things that we do that I'm so excited about being a part of is called Theo Global, where we host theological conversations (like we do on the White Horse Inn) between Baptist, Lutheran, Reformed, Anglican traditions and bring people together from a particular region. So we've been doing it for eleven years in India and also almost that long in Nigeria or in Kenya, in Nairobi. And then also Cairo for the Middle East. We just did one in Thailand that Pakistanis and Indians were able to come to, because they're not able usually to see each other. And then we are, Lord willing, starting another one in Southeast Asia, probably Singapore.So these have been so rich. Out of them are coming, a series of theology books from the global church to the global church. And so instead of having just regional theologies or theologies that pretend that they're not culturally contextual, we want to hear the voices of people from different locations testifying to the same Gospel, and that's just really been lots of fun.[05:42] Jonathan: Well, having ministered near that area of the world in Australia, you're right, there can be a disconnect between the cultures. We read each other's books and that sort of thing, and those are Western cultures, but I think we miss out on hearing about what is happening in Southeast Asia, Because they do face similar obstacles but also some quite different. As one of the points of your book is, there is still the one true God and the one Gospel that reaches across those cultures and reaches across so many of those things that we would consider barriers. And I think that's wonderful. I pray the Lord would bless that.[06:30] Michael: Thank you. One of the things I find, Jonathan, is there is a sweet unity around the Gospel that binds us when I go to these other places. Wherever I am in the world, I don't feel like I'm a stranger because I'm with my brothers and sisters. I wish I felt the same way in America. It's very different here.[06:51] Jonathan: Yeah, I was going to say it's interesting that what you're doing is you're unifying and uniting across denominations, across cultural things, and yet that's working almost in the opposite direction of where we see things here, which is there's division within denominations; there's division within small regions. You're undoing what is happening on a bigger scale in some of the Western parts. It's exciting to hear that's not happening everywhere, that there's actually some unification taking place and that's encouraging. And I know that's going to be an aspect of what we talk about in our conversation about one of your new books.Now, I know that you had some health issues with your heart a couple of years ago. Maybe for some of our audience who didn't know or having heard any updates, are you healthy?[07:54] Michael: Thanks for asking. Yes, what it was was a valve that just exploded in my heart, so it was an emergency open-heart surgery. But they said—they know my arteries and my heart better than anybody, they said, you'll die of something, but it won't be of heart disease. You have a good heart; you have good arteries; this was just a fluke.[08:24] Jonathan: Unbelievable.[08:25] Michael: So—yeah. I'm fully recovered. They said I could go bungee jumping again if I want to.[08:32] Jonathan: Again. I'm glad that you were already doing that—I picked up your book a while ago and I've been wanting to have you on the podcast ever since reading it. And the book is called Recovering Our Sanity: How the Fear of God Conquers the Fears that Divide Us. And my goodness, what a perfect title for everything we see. Give us a little bit of the reason for writing and the timing of the book.[09:18] Michael: Well, it had been percolating for years now, actually. I wrote a book many years ago called Beyond Culture Wars: Is America a Mission Field or a Battlefield? And this is in a similar vein, but really in light of the fears that really divide us today. And the center used to be the Bible, the Gospel, getting the Gospel right and getting the Gospel out. We have our doctrinal differences across the evangelical mainstream, but basically we had different political views and those political views didn't divide between brothers and sisters and churches.And what I've seen lately has just been like a food fight in a cafeteria, and political issues and social issues raised to the level of the Trinity. And it's like, okay, well, we can argue about that over coffee, but we don't bring it into the church. That used to be kind of how people thought about things. These things are important, but they're not as important as our unity in Christ. But I hear people attacking pastors, pastors attacking their flock, back and forth over these issues. And I think people don't get this heated over the doctrine of election or justification or the Trinity. Does it suggest that these issues are deeper in our hearts than the truth of Christianity, so what really binds us?And I looked at it and I said what really binds us is salvation, what we think we're saved from. If we think we're saved from the people over there who are threatening our values, or the people over there who are different from us ethnically, or the people over there who have a different view of economics and social justice? What are we really afraid of? What are our ultimate fears? And I argue that we have all these secondary fears. The real fear deep down, the mother of all fears, is the fear of death. And none of the solutions that can be offered by FOX or CNN, there is no solution to that. But we have it. Why isn't that on our dashboard as central, getting it right and getting it out?[13:01] Jonathan: In the book you cast a broad net in kind of what you've just said up here, picking out a few of the issues that you're seeing so much division over. But then you lay out some of the theological framework to reorientate your reader to where fear should rightly be placed. And it's away from the fear of one another and having a right fear of God.And you use the word sublime in the book, which I found really helpful as an aspect of God. I wonder if you could give us a little bit of explanation and walk that out for us.[13:52] Michael: Sure. I love that word. Sublime is really, I think, what we're talking about when we talk about the fear of God. Some people will say, “Well, it's not really fear. It's reverence, awe.” Fear is a big part of it, but it's a kind of fear that attracts. Think of what happens if you've ever stood at the mouth of a volcano, looking over it, watching the lava flow. Or I live in Southern California, so we have fires, and there's a kind of weird attraction to going to the fire and seeing it. Or you're out on the ocean and you're terrified. A squall comes up you're afraid, but you're also kind of your heart is racing not just because you're afraid, but also because you're kind of in awe of what's happening. In awe of the waves.God, you know whenever an angel shows up in the Bible, an emissary of God, what's the first thing? You know the number-one commandment throughout Scripture? The number-one command is “Be not afraid.” Because when even the mailman of God shows up, people are terrified.[15:31] Jonathan: Yeah, or Moses's face is a little too bright.[15:36] Michael: Yeah. Hey, put a napkin over that or something… That's what, really, is the basis for all sublime events, encounters that we have is really the fear of God. And so it's … A Jewish writer, John Levinson, puts it well. He says, “In the Hebrew Scriptures God beckons with one hand and repels with the other.”So there's a kind of don't get too close. Even Jesus in His Resurrection, “Don't touch me. I'm different.” God is different from us. And that sense of awe, of majesty, of even terror. Think of the disciples in the boat with Jesus. They were afraid of the storm, and then Jesus calmed the storm and they were afraid of Jesus. Who is this who has control over the winds and the waves? They were terrified. And that's the kind of Who is this? What am I dealing with here? The kind of shock and awe, the surprise is something that is missing, I think, from a lot of our experience as Christians today.[17:11] Jonathan: Well, and I know in the book we've seen a lot of the statistical evidence that comes in support of what you've just said, which shows that evangelical Christians really don't know what they believe. They have a complete misunderstanding of God, of the nature of Christ, of their roles.[17:51] Michael: If the fear of God is not the beginning of our wisdom, then something else will be. We'll fear something else. We will fear other people who are different from us and we'll fear cancer, we'll fear losing our job, we'll fear environmental collapse and catastrophe, we'll fear these other people taking over. It's not that those … that there aren't legitimate concerns of a political and social and cultural nature. But we have a disordered fear. And if we have disordered fears, we have disordered loves.God is not only the source of our greatest fear, legitimate fear; He's also the only one who conquers our fears and says, “Welcome home, prodigal. Welcome home, here's the feast.”[19:22] Jonathan: And deals with our, as you refer to it, the mother of all fears.[19:27] Michael: Death. We're dying. In California, people aren't allowed to die; they pass away; and we put these cemeteries out, far away from view, or we turn them into parks and things. And it used to be every time you walked into a church there would be headstones, and it reminded you as you walked in why you're going in there. The Gospel is for dying people, and we're all on that road. And so the question is, How do we face death? … How is that ultimate anxiety relieved? We mourn, but not as those who have no hope. So what does that mean for my daily life now? I could be twelve years old and I'm dying. I could be eighty and I'm dying. So what … Let's talk about that. Let's talk about the dying and the resurrection of the dead and being attached to Jesus so that what He is in His humanity right now, glorified, we will be. Let's talk about that. That's a lot better than anything on CNN or FOX.[21:00] Jonathan: I love it. I think in the book you tell the story of when you went to a debate with, I might be messing this up, but I think it was with an atheist and you sort of said, “Yep. Great. Can I talk about Jesus now” and kind of put him off, and he sort of like, “I wasn't prepared to debate that.”[21:22] Michael: Yeah. This was years ago. Bill Nye the Science Nye.[21:24] Jonathan: Bill Nigh, that's right.[21:25] Michael: He was talking about how religion is based on false fears and so they develop myths and so forth.[21:37] Jonathan: And you were like, “Well, that's true.”[21:39] Michael: Yeah. I don't disagree; that's a pretty fair analysis of religions. I guess you'd have to take one by one and analyze it, but as a generalization, now can I talk about Jesus and His Resurrection? Let's keep getting back to the main business here.[21:59] Jonathan: The main issue. Yeah. In the book you draw this distinction between naturalistic and hyper supernatural, but then you sort of carve out this third option of ordinary. Can we talk a little bit about that and how we see that playing out in our world today, particularly in the Church?[22:23] Michael: Sure. Often what you see today is a naturalism underwriting the progressive agenda and John Lennon's “Imagine.” On the right, you tend to have a hyper supernaturalism wedded to a conservative agenda. And so what do I mean by that? Well, a naturalistic worldview says, of course, God isn't involved. If God exists, then He's not involved in this world. He didn't create it, it's self-evolving and so forth.A hyper-supernatural worldview says that God works miraculous. You know, to say that God did it means it's a miracle.[23:34] Jonathan: Yeah.[23:35] Michael: Whereas in the Bible God does all sorts of things. Mostly, He doesn't perform miracles. What about all the times when we cut our finger and it heals after a week? What about that? What about a child [who] has a brain bleed in NICU and it resolves in 24 hours. How about those? Those aren't miracles. People say, “the miracle of childbirth.” There's no miracle of childbirth; it's just a spectacular example of God's providence. That's part of our problem is we're looking for God only in the spectacular, only in the extraordinary, only in places where we can point to and say, “Oh, God did that.”So we can't explain how somebody recovered from cancer; we say, “Well, God did it, not the doctors.”[24:46] Jonathan: Right.[24:47] Michael: Well, how about God did it and the doctors did it. God did it through the doctors.[24:52] Jonathan: How much control does God have here?[24:55] Michael: Right. He has control of everything. It's not just supernatural events; it's not just miracles. God's in control of every second, every breath. Every breath that you and I take is under His dominion.[25:11] Jonathan: That's right. He holds all things together. You know, I hear that phrase a lot, “That was a God thing. That was a God thing,” and I always have to stop and say to them, “Everything is a God thing.” I mean, conversations. The fact that your brain works. The ability to read. The ability to understand and reason. It's like I hate when you get that narrow scope, as you're saying. We've lost the sublime. We've lost an understanding of how much—you know, it's almost a deistic view that, you know, God sort of—[25:42] Michael: Yes![25:43] Jonathan: He's put some things in place and then He occasionally steps in and—[25:47] Michael: That's why I argue that actually naturalism and hyper supernaturalism unintentionally conspire with each other against Christianity—[25:57] Jonathan: Right.[25:58] Michael: —you know because, you know, we get to the place where we don't see God in our ordinary, everyday existence, but only in these punctuated events, and we've got to raise things. I think we do a lot of pretending. We pretend that things that have an ordinary explanation are miracles because we have to have God in our life. These large swaths of our lives where there are no miracles are upheld by God's marvelous providence.[26:40] Jonathan: Right. Amen to that. In the book, one of the fears you mentioned is fear of losing your job. And I think in the book you helpfully distinguish between calling and vocation or job and helping us understand and distinguish the two things. I wonder if we can talk a little bit of bringing clarity to that, because we're longing for something to put our identity in. Is it a football club? Is it a university? We're currently, I don't know when this will air, but we're in the middle of March Madness. Who did you pick? What's your university? What's your background?And vocation is very much one of those things we can put our identity in, and yet I think you talk about the ultimate and the penultimate between calling and vocation. I wonder if you could bring some clarity to that, and then we'll turn to some of the practical outworkings of the division we see after that.[27:53] Michael: Yeah. Well, one of the things I try to maintain throughout the book is, look, the things I'm talking about are not unimportant. They are legitimate fears. There is a legitimate anxiety. The question is, where do we go with that? But yes, let's affirm it. It's real, it's a deal, but penultimate not ultimate.For example, if I am in a circle of people I've never met before, we're having breakfast, and I ask them, “Tell me about yourself,” very ordinarily they'll say, “Well, I'm a dentist. I'm a …”Now okay, there's an example. That is part of our identity. Vocation is a gift of God; it's a calling. So to say, you know, we shouldn't place our identity in our vocations, well, not ultimately. That's the problem. It's a part of our identity, just like being a father is part of my identity. That's a calling. And we have to realize, as Luther said, we have many callings, many vocations during our life. We're parents, we're spouses, we're children, we are extended family members, we're dentists, and cleaning movie theaters. We have all kinds of callings/vocations. Sometimes we have a vocation to suffer, to carry a cross. Sometimes we have a vocation to be a friend. We have lots of vocations, and keeping them in balance is very important.Keeping them penultimate, not ultimate, is my point. My ultimate identity is chosen, redeemed, justified, being sanctified, will be glorified, in union with Christ. That's my identity and that's really who I am. Paul talks about himself as if he's almost collapsed into Jesus. His identity is so bound up with Christ that he can even say his suffering is something he glories in because it shares in Christ's suffering. That's my identity; that's where I really find who I am. The other stuff is not just stuff I do, that turns it back into a job. It is part of my identity, but it's penultimate, not ultimate.[30:57] Jonathan: Well, as we said at the beginning, we see division in so many different places. We're, of course, as you know, we're in another election year, and that—fear is going to be used as a … it's going to be weaponized this year, particularly this year, in America. And we have an international audience, so I want to be sensitive, but I know that internationally also they see a lot of American news as well. I think you talk about how, in the book, two sides to the fear coin. You mention both in the book. One side, fear is easily exploited as a motivator. On the other, fear is a weak motivator in the long term. Why is that? Let's kind of unpack that a little bit.[32:07] Michael: Yeah. I use the analogy of deer who are … there is this fight or flight that God gave us and the animals as well. It's purely instinctual, instinctive. You don't … Whether you're a deer or a human being, you don't really think about, you don't contemplate, you don't calculate, you don't explore what … You have a car coming towards you, you flee. You get out of its way if you can. But what happens is—That's adrenaline. That adrenaline rush is just a marvelous gift of God's providence. The problem is what would happen is deer had this disease of constantly being afraid, every crack of brush of another deer drove them wild running in fear? That's what I see us doing now, and what happens is it works in the short term. If you're going to cynically use fear to get a herd of people to do what you want them to do, that might work in the short term, but long term, people can't live like that. Long term, people actually become cynical. They won't participate at all. They'll just turn it off because “I've had this scare a thousand times and I'm not going to have it anymore. I'm tired of it.” It just runs out.And that's what I think a lot of people are feeling right now with American politics. So I'm not an analyst of American politics by any stretch of the imagination; I'm simply looking at it on the pastoral side. What is driving us to be like the deer in the headlights every five minutes? And it's exhausting us.[34:33] Jonathan: Yeah.[34:34] Michael: Each side whipping up the other side against each other. If I don't win this election, dot, dot, dot. If the other person wins the election, dot, dot, dot. It's apocalypse not. I especially find offensive any use of God or the Bible or Christ for that fear. Anyone who does that, particularly cynical leaders who don't even go to church, aren't professing Christians really, but they use the lingo to gain the nomination of particular groups. When Christians participate in that, they carry crosses to the U.S. Capitol to storm it and talk about hanging the vice president, and they're carrying crosses with Bible verses, this is the sort of thing that must just aggravate our Lord and Savior whose name is taken in vain.And yeah, is that a critique especially of evangelical political conservatives? Yes, it is. Because they are my brothers and sisters closest to me. The secularists aren't really invoking the name of Jesus and Bible verses and carrying crosses. I'm more worried about evangelicals distorting the gospel than I am about who wins this next election.[36:54] Jonathan: What is that doing to your testimony to those people who don't know the Lord? What message is it giving them?[37:10] Michael: That Christianity is about power.[37:11] Jonathan: Right, exactly.[37:12] Michael: It's not about a cross with God who has all power becoming flesh being spat upon and then being crucified upon a cross, bleeding for our sins. It's about basically choosing Caesar over Jesus, making Pilate our hero rather than Jesus.[37:45] Jonathan: I found that chapter, I can't remember if it's the Christian nationalism chapter or the one before, but it was really helpful the way that you walked out American history in a way that probably a lot of the readers might say, “I don't know if I understood that.” Or “I don't know if I fully understood Thomas Jefferson and his letter to the Danbury Baptist Church in Connecticut.” Understanding separation of church and state, understanding like how we got to where we are and the creating of even thinking between the British … French revolution and those different paths that were laid out before us. And even just understanding our own history and how we got to where we are, I think a lot of it is just cast as Christian nation. And I found it helpful the way you distinguish that.Because I hear this a lot in the church in terms of America being the new Israel, are there blessings that have come with certain things? Sure, fine. Our Constitution is well put together. I love the history of Witherspoon, the Scottish Presbyterian, and you can see some of that in the language that comes out through the Constitution. Again, I think it's helpful to have your historical understanding rather than this reinterpretation that we have now that it's, as you said, it's this feeling like someone's come in and taken this from us. And now, to use the title of your other book, now we're at war, right? It's not a mission field, it's a battlefield. We're fighting for the honor of our country. And all that's done is create us and them division and a lack of clarity and a lack of what we're called to in a mission sense as Christians. Where was I going with that? Who knows? Anyway, I found it helpful.[40:10] Michael: You said it better. Preach it, brother.[40:16] Jonathan: Just random thoughts. Just reading your books and regurgitating it to the people. So later on in the book you sort of walk us through the areas where division has come in. So we have Christian nationalism has certainly seeped into churches. Then you have some really helpful, short chapters with issues with LGBTQ+ community, cancel culture, racism. Let's just kind of walk through some of these and help Christians who are listening to this who are saying, I thought this was the right way to handle that situation but you're saying something else. Let's kind of walk through maybe even just one or two of those. Again, you had a really great illustration under your LGBTQ+ chapter of the young man whose family had sent him to you and you were pastoring him and what happened with all that. If you could tell us a little bit about that, just to help kind of encapsulate what we're talking about here.[41:35] Michael: Sure, this brother struggling with homosexuality, his dad was on the board of a prominent evangelical organization, and his pastor had told him that we basically don't want your influence in the church, so he was considering leaving the faith. But then he read Putting Amazing Back Into Grace, a book I wrote a long time ago, and came out to work at our organization as just a pretext for just hanging out and shepherding this guy. He became a part of our church and a lot of people looked after him and we got a lot back from him.He went back home, and his pastor said that all this reformed teaching he was getting was heresy and so forth, and no, you've lost your salvation. Romans says that He gave them over to a depraved mind. So he committed suicide and …So what is it? Why do you do stuff like that? Well, you do it out of bad theology, to be sure, but also out of fear. There are a lot of churches that just don't want to deal with it. They don't want to have this problem. They don't want to say that they have people in their congregation who are really, really suffering. If you're a secularist, you don't suffer from homosexuality. You don't suffer with gender dysphoria. Only Christians do. And only Christians suffer with greed and envy and malice and other sins that are listed in these same sin lists in the New Testament. You don't lose your salvation over those.The key is repentance, right? We're called to a life of repentance. Whatever our tendencies are towards particular sins, we're all corrupt in heart. We're sinners and we're sinned against and we are in a sin-cursed world. And so where do we go with that fear? And then once that fear is solved objectively in Christ, having been justified through faith, we have peace with God. That's an objective fact. With that now as an objective fact, how do I respond to this brother or sister who's justified just as I am, and who is being sanctified just as I am, but has propensity toward a particular sin that I think is particularly serious, particularly great? How do I love this person? How do I respond to this person?John Calvin said a pastor needs to learn how to have two voices: one for the sheep and one for the wolves. And what I've seen in some very close cases to my own experience, what I've seen sometimes is pastors confusing the sheep for wolves and treating them as apostates or as people who, you know, if you really were a Christian, you wouldn't be suffering with that. Well, they're not saying, “I have a right to this sin.” They're not saying that it's okay. That's why they're struggling with it—and they're struggling with it in your church.So one of the surveys, actually a couple of the surveys concluded that about 80 percent of people in the LGBTQ+ community were raised in conservative Roman Catholic or Protestant churches.[46:39] Jonathan: Give that statistic again because I think we need to hear it again.[46:42] Michael: I don't know exact, it's in the 80s, 80 percent.[46:46] Jonathan: Over 80 percent.[46:49] Michael: Right. And what's even more striking is the same percentage said that they would come back to church, even if they didn't change their rules, but listened to them and cared for them. That's what I found amazing. I was glad that they asked … they added in that survey even if they didn't change their beliefs but they were kind and they listened and they cared for me.So if I'm fearful, here again the adrenaline, the deer in the headlights, that's a gift God gave us for fleeing something that is imminently threatening. This is not imminently threatening. If I come to understand that, then I'm not a deer in the headlights; instead, my brother or sister, my friend, parent, I'm someone who is looking out for the best of this person and now I can actually get ahold of myself and think and make judgments and articulate things. And ask questions and get information. That's a big part of it. It's not all spiritual. People are suffering from mental health disorders, and that's physical, that's brain chemistry. All kinds of things.People are suffering from sins that have been committed against them in the past. A lot of this is very complicated, and it's not all that person's direct fault. Again, we're all sinners, sinned against, and live in a sin-cursed world. And all those factors play into what we have to consider when we're not the deer in the headlights but can sit down with people over a long time, be willing to walk with them over a long time, be willing to read up on things, ask them questions, we're that interested in them and understanding what they're going through, understanding their pain. It's like if they have cancer we'd be at their house with casseroles, but if they have these things, you know … So let's … fear of the Lord drives out the fears of everyone and everything else. This is the beginning of wisdom.[48:52] Jonathan: Exactly. Well, I think we could probably have this conversation for probably another four more hours, which we might do just because we're having so many technical difficulties. You know, I can't recommend this book enough. Mike Horton, Recovering Our Sanity: How the Fear of God Conquers the Fears that Divide Us. I told my team I want to re-air this as we get closer to November so that we can all be reminded once again of what we're called to. Mike, what are you working on at the moment?[50:35] Michael: I've been kind of obsessive compulsive about a project, three volumes with Eerdmans. First volume is coming out in May, titled Shaman and Sage. This is a very different project. It's the history of spiritual not religious. Where does this come from? You have this divine self within trying to break out of all constraints. And so I trace it all the way back to ancient Greece and to the Renaissance. And then the second volume, Renaissance to the scientific revolution. And then the third volume is covering Romanticism to the present.[51:31] Jonathan: Oprah.[51:32] Michael: Exactly.[51:35] Jonathan: That's going to be a massive help for believers, because that's the one we see a lot in those statistics. Yeah, I hear that from quite a few people, spiritual but not religious, or whatever the phrase is. But well, Mike Horton, it's been such a privilege. I'm so grateful for your time and coming on to Candid Conversations and sharing with us.[52:10] Michael: Jonathan, thank you so much. It's been a pleasure.[52:14] Jonathan: Thank you, brother.  

Latent Space: The AI Engineer Podcast — CodeGen, Agents, Computer Vision, Data Science, AI UX and all things Software 3.0

At the AI Pioneers Summit we announced Latent Space Launchpad, an AI-focused accelerator in partnership with Decibel. If you're an AI founder of enterprise early adopter, fill out this form and we'll be in touch with more details. We also have a lot of events coming up as we wrap up the year, so make sure to check out our community events page and come say hi!We previously interviewed the founders of many developer productivity startups embedded in the IDE, like Codium AI, Cursor, and Codeium. We also covered Replit's (former) SOTA model, replit-code-v1-3b and most recently had Amjad and Michele announce replit-code-v1_5-3b at the AI Engineer Summit.Much has been speculated about the StackOverflow traffic drop since ChatGPT release, but the experience is still not perfect. There's now a new player in the “search for developers” arena: Phind.Phind's goal is to help you find answers to your technical questions, and then help you implement them. For example “What should I use to create a frontend for a Python script?” returns a list of frameworks as well as links to the sources. You can then ask follow up questions on specific implementation details, having it write some code for you, etc. They have both a web version and a VS Code integrationThey recently were top of Hacker News with the announcement of their latest model, which is now the #1 rated model on the BigCode Leaderboard, beating their previous version:TLDR Cheat Sheet:* Based on CodeLlama-34B, which is trained on 500B tokens* Further fine-tuned on 70B+ high quality code and reasoning tokens* Expanded context window to 16k tokens* 5x faster than GPT-4 (100 tok/s vs 20 tok/s on single stream)* 74.7% HumanEval vs 45% for the base modelWe've talked before about HumanEval being limited in a lot of cases and how it needs to be complemented with “vibe based” evals. Phind thinks of evals alongside two axis: * Context quality: when asking the model to generate code, was the context high quality? Did we put outdated examples in it? Did we retrieve the wrong files?* Result quality: was the code generated correct? Did it follow the instructions I gave it or did it misunderstand some of it?If you have bad results with bad context, you might get to a good result by working on better RAG. If you have good context and bad result you might either need to work on your prompting or you have hit the limits of the model, which leads you to fine tuning (like they did). Michael was really early to this space and started working on CommonCrawl filtering and indexing back in 2020, which led to a lot of the insights that now power Phind. We talked about that evolution, his experience at YC, how he got Paul Graham to invest in Phind and invite him to dinner at his house, and how Ron Conway connected him with Jensen Huang to get access to more GPUs!Show Notes* Phind* BigScience T0* InstructGPT Paper* Inception-V3* LMQL* Marginalia Nu* Mistral AI* People:* Paul Graham (pg)* Ron Conway* Yacine Jernite from HuggingFace* Jeff DelaneyTimestamps* [00:00:00] Intros & Michael's early interest in computer vision* [00:03:14] Pivoting to NLP and natural language question answering models* [00:07:20] Building a search engine index of Common Crawl and web pages* [00:11:26] Releasing the first version of Hello based on the search index and BigScience T0 model* [00:14:02] Deciding to focus the search engine specifically for programmers* [00:17:39] Overview of Phind's current product and focus on code reasoning* [00:21:51] The future vision for Phind to go from idea to complete code* [00:24:03] Transitioning to using the GPT-4 model and the impact it had* [00:29:43] Developing the Phind model based on CodeLlama and additional training* [00:32:28] Plans to continue improving the Phind model with open source technologies* [00:43:59] The story of meeting Paul Graham and Ron Conway and how that impacted the company* [00:53:02] How Ron Conway helped them get GPUs from Nvidia* [00:57:12] Tips on how Michael learns complex AI topics* [01:01:12] Lightning RoundTranscriptAlessio: Hey everyone, welcome to the Latent Space Podcast. This is Alessio, partner and CTO of Residence and Decibel Partners, and I'm joined by my co-host Swyx, founder of Smol AI. [00:00:19]Swyx: Hey, and today we have in the studio Michael Royzen from Phind. Welcome. [00:00:23]Michael: Thank you so much. [00:00:24]Alessio: It's great to be here. [00:00:25]Swyx: Yeah, we are recording this in a surprisingly hot October in San Francisco. And sometimes the studio works, but the blue angels are flying by right now, so sorry about the noise. So welcome. I've seen Phind blow up this year, mostly, I think since your launch in Feb and V2 and then your Hacker News posts. We tend to like to introduce our guests, but then obviously you can fill in the blanks with the origin story. You actually were a high school entrepreneur. You started SmartLens, which is a computer vision startup in 2017. [00:00:59]Michael: That's right. I remember when like TensorFlow came out and people started talking about, obviously at the time after AlexNet, the deep learning revolution was already in flow. Good computer vision models were a thing. And what really made me interested in deep learning was I got invited to go to Apple's WWDC conference as a student scholar because I was really into making iOS apps at the time. So I go there and I go to this talk where they added an API that let people run computer vision models on the device using far more efficient GPU primitives. After seeing that, I was like, oh, this is cool. This is going to have a big explosion of different computer vision models running locally on the iPhone. And so I had this crazy idea where it was like, what if I could just make this model that could recognize just about anything and have it run on the device? And that was the genesis for what eventually became SmartLens. I took this data set called ImageNet 22K. So most people, when they think of ImageNet, think of ImageNet 1K. But the full ImageNet actually has, I think, 22,000 different categories. So I took that, filtered it, pre-processed it, and then did a massive fine tune on Inception V3, which was, I think, the state of the art deep convolutional computer vision model at the time. And to my surprise, it actually worked insanely well. I had no idea what would happen if I give a single model. I think it ended up being 17,000 categories approximately that I collapsed them into. It worked so well that it actually worked better than Google Lens, which released its V1 around the same time. And on top of this, the model ran on the device. So it didn't need an internet connection. A big part of the issue with Google Lens at the time was that connections were slower. 4G was around, but it wasn't nearly as fast. So there was a noticeable lag having to upload an image to a server and get it back. But just processing it locally, even on the iPhones of the day in 2017, much faster. It was a cool little project. It got some traction. TechCrunch wrote about it. There was kind of like one big spike in usage, and then over time it tapered off. But people still pay for it, which is wild. [00:03:14]Swyx: That's awesome. Oh, it's like a monthly or annual subscription? [00:03:16]Michael: Yeah, it's like a monthly subscription. [00:03:18]Swyx: Even though you don't actually have any servers? [00:03:19]Michael: Even though we don't have any servers. That's right. I was in high school. I had a little bit of money. I was like, yeah. [00:03:25]Swyx: That's awesome. I always wonder what the modern equivalents kind of "Be my eyes". And it would be actually disclosed in the GPT-4 Vision system card recently that the usage was surprisingly not that frequent. The extent to which all three of us have our sense of sight. I would think that if I lost my sense of sight, I would use Be My Eyes all the time. The average usage of Be My Eyes per day is 1.5 times. [00:03:49]Michael: Exactly. I was thinking about this as well, where I was also looking into image captioning, where you give a model an image and then it tells you what's in the image. But it turns out that what people want is the exact opposite. People want to give a description of an image and then have the AI generate the image. [00:04:04]Alessio: Oh, the other way. [00:04:06]Michael: Exactly. And so at the time, I think there were some GANs, NVIDIA was working on this back in 2019, 2020. They had some impressive, I think, face GANs where they had this model that would produce these really high quality portraits, but it wasn't able to take a natural language description the way Midjourney or DALL-E 3 can and just generate you an image with exactly what you described in it. [00:04:32]Swyx: And how did that get into NLP? [00:04:35]Michael: Yeah, I released the SmartLens app and that was around the time I was a senior in high school. I was applying to college. College rolls around. I'm still sort of working on updating the app in college. But I start thinking like, hey, what if I make an enterprise version of this as well? At the time, there was Clarify that provided some computer vision APIs, but I thought this massive classification model works so well and it's so small and so fast, might as well build an enterprise product. And I didn't even talk to users or do any of those things that you're supposed to do. I was just mainly interested in building a type of backend I've never built before. So I was mainly just doing it for myself just to learn. I built this enterprise classification product and as part of it, I'm also building an invoice processing product where using some of the aspects that I built previously, although obviously it's very different from classification, I wanted to be able to just extract a bunch of structured data from an unstructured invoice through our API. And that's what led me to Hugnyface for the first time because that involves some natural language components. And so I go to Hugnyface and with various encoder models that were around at the time, I used the standard BERT and also Longformer, which came out around the same time. And Longformer was interesting because it had a much bigger context window than those models at the time, like BERT, all of the first gen encoder only models, they only had a context window of 512 tokens and it's fixed. There's none of this alibi or ROPE that we have now where we can basically massage it to be longer. They're fixed, 512 absolute encodings. Longformer at the time was the only way that you can fit, say, like a sequence length or ask a question about like 4,000 tokens worth of text. Implemented Longformer, it worked super well, but like nobody really kind of used the enterprise product and that's kind of what I expected because at the end of the day, it was COVID. I was building this kind of mostly for me, mostly just kind of to learn. And so nobody really used it and my heart wasn't in it and I kind of just shelved it. But a little later, I went back to HugMeFace and I saw this demo that they had, and this is in the summer of 2020. They had this demo made by this researcher, Yacine Jernite, and he called it long form question answering. And basically, it was this self-contained notebook demo where you can ask a question the way that we do now with ChatGPT. It would do a lookup into some database and it would give you an answer. And it absolutely blew my mind. The demo itself, it used, I think, BART as the model and in the notebook, it had support for both an Elasticsearch index of Wikipedia, as well as a dense index powered by Facebook's FAISS. I think that's how you pronounce it. It was very iffy, but when it worked, I think the question in the demo was, why are all boats white? When it worked, it blew my mind that instead of doing this few shot thing, like people were doing with GPT-3 at the time, which is all the rage, you could just ask a model a question, provide no extra context, and it would know what to do and just give you the answer. It blew my mind to such an extent that I couldn't stop thinking about that. When I started thinking about ways to make it better, I tried training, doing the fine tune with a larger BART model. And this BART model, yeah, it was fine tuned on this Reddit data set called Eli5. So basically... [00:08:02]Alessio: Subreddit. [00:08:03]Swyx: Yeah, subreddit. [00:08:04]Alessio: Yeah. [00:08:05]Michael: And put it into like a well-formatted, relatively clean data set of like human questions and human answers. And that was a really great bootstrap for that model to be able to answer these types of questions. And so Eli5 actually turned out to be a good data set for training these types of question answering models, because the question is written by a human, the answer is written by a human, and at least helps the model get the format right, even if the model is still very small and it can't really think super well, at least it gets the format right. And so it ends up acting as kind of a glorified summarization model, where if it's fed in high quality context from the retrieval system, it's able to have a reasonably high quality output. And so once I made the model as big as I can, just fine tuning on BART large, I started looking for ways to improve the index. So in the demo, in the notebook, there were instructions for how to make an Elasticsearch index just for Wikipedia. And I was like, why not do all of Common Crawl? So I downloaded Common Crawl, and thankfully, I had like 10 or $15,000 worth of AWS credits left over from the SmartLens project. And that's what really allowed me to do this, because there's no other funding. I was still in college, not a lot of money, and so I was able to spin up a bunch of instances and just process all of Common Crawl, which is massive. So it's roughly like, it's terabytes of text. I went to Alexa to get the top 1,000 websites or 10,000 websites in the world, then filtered only by those websites, and then indexed those websites, because the web pages were already included in Dump. [00:09:38]Swyx: You mean to supplement Common Crawl or to filter Common Crawl? [00:09:41]Michael: Filter Common Crawl. [00:09:42]Alessio: Oh, okay. [00:09:43]Michael: Yeah, sorry. So we filtered Common Crawl just by the top, I think, 10,000, just to limit this, because obviously there's this massive long tail of small sites that are really cool, actually. There's other projects like, shout out to Marginalia Nu, which is a search engine specialized on the long tail. I think they actually exclude the top 10,000. [00:10:03]Swyx: That's what they do. [00:10:04]Alessio: Yeah. [00:10:05]Swyx: I've seen them around, I just don't really know what their pitch is. Okay, that makes sense. [00:10:08]Michael: So they exclude all the top stuff. So the long tail is cool, but for this, that was kind of out of the question, and that was most of the data anyway. So we've removed that. And then I indexed the remaining approximately 350 million webpages through Elasticsearch. So I built this index running on AWS with these webpages, and it actually worked quite well. You can ask it general common knowledge, history, politics, current events, questions, and it would be able to do a fast lookup in the index, feed it into the model, and it would give a surprisingly good result. And so when I saw that, I thought that this is definitely doable. And it kind of shocked me that no one else was doing this. And so this was now the fall of 2020. And yeah, I was kind of shocked no one was doing this, but it costs a lot of money to keep it up. I was still in college. There are things going on. I got bogged down by classes. And so I ended up shelving this for almost a full year, actually. When I returned to it in fall of 2021, when BigScience released T0, when BigScience released the T0 models, that was a massive jump in the reasoning ability of the model. And it was better at reasoning, it was better at summarization, it was still a glorified summarizer basically. [00:11:26]Swyx: Was this a precursor to Bloom? Because Bloom's the one that I know. [00:11:29]Alessio: Yeah. [00:11:30]Michael: Actually coming out in 2022. But Bloom had other problems where for whatever reason, the Bloom models just were never really that good, which is so sad because I really wanted to use them. But I think they didn't turn on that much data. I think they used like the original, they were trying to replicate GPT-3. So they just use those numbers, which we now know are like far below Chinchilla Optimal and even Chinchilla Optimal, which we can like talk about later, like what we're currently doing with MIMO goes, yeah, it goes way beyond that. But they weren't trying enough data. I'm not sure how that data was clean, but it probably wasn't super clean. And then they didn't really do any fine tuning until much later. So T0 worked well because they took the T5 models, which were closer to Chinchilla Optimal because I think they were trained on also like 300 something billion tokens, similar to GPT-3, but the models were much smaller. I think T0 is the first model that did large scale instruction tuning from diverse data sources in the fall of 2021. This is before Instruct GPT. This is before Flan T5, which came out in 2022. This is the very, very first, at least well-known example of that. And so it came out and then I did, on top of T0, I also did the Reddit Eli5 fine tune. And that was the first model and system that actually worked well enough to where I didn't get discouraged like I did previously, because the failure cases of the BART based system was so egregious. Sometimes it would just miss a question so horribly that it was just extremely discouraging. But for the first time, it was working reasonably well. Also using a much bigger model. I think the BART model is like 800 million parameters, but T0, we were using 3B. So it was T0, 3B, bigger model. And that was the very first iteration of Hello. So I ended up doing a show HN on Hacker News in January 2022 of that system. Our fine tune T0 model connected to our Elasticsearch index of those 350 million top 10,000 common crawl websites. And to the best of my knowledge, I think that's the first example that I'm aware of a LLM search engine model that's effectively connected to like a large enough index that I consider like an internet scale. So I think we were the first to release like an internet scale LLM powered rag search system In January 2022, around the time me and my future co-founder, Justin, we were like, this seems like the future. [00:14:02]Alessio: This is really cool. [00:14:03]Michael: I couldn't really sleep even like I was going to bed and I was like, I was thinking about it. Like I would say up until like 2.30 AM, like reading papers on my phone in bed, go to sleep, wake up the next morning at like eight and just be super excited to keep working. And I was also doing my thesis at the same time, my senior honors thesis at UT Austin about something very similar. We were researching factuality in abstractive question answering systems. So a lot of overlap with this project and the conclusions of my research actually kind of helped guide the development path of Hello. In the research, we found that LLMs, they don't know what they don't know. So the conclusion was, is that you always have to do a search to ensure that the model actually knows what it's talking about. And my favorite example of this even today is kind of with chat GPT browsing, where you can ask chat GPT browsing, how do I run llama.cpp? And chat GPT browsing will think that llama.cpp is some file on your computer that you can just compile with GCC and you're all good. It won't even bother doing a lookup, even though I'm sure somewhere in their internal prompts they have something like, if you're not sure, do a lookup. [00:15:13]Alessio: That's not good enough. So models don't know what they don't know. [00:15:15]Michael: You always have to do a search. And so we approached LLM powered question answering from the search angle. We pivoted to make this for programmers in June of 2022, around the time that we were getting into YC. We realized that what we're really interested in is the case where the models actually have to think. Because up until then, the models were kind of more glorified summarization models. We really thought of them like the Google featured snippets, but on steroids. And so we saw a future where the simpler questions would get commoditized. And I still think that's going to happen with like Google SGE and like it's nowadays, it's really not that hard to answer the more basic kind of like summarization, like current events questions with lightweight models that'll only continue to get cheaper over time. And so we kind of started thinking about this trade off where LLM models are going to get both better and cheaper over time. And that's going to force people who run them to make a choice. Either you can run a model of the same intelligence that you could previously for cheaper, or you can run a better model for the same price. So someone like Google, once the price kind of falls low enough, they're going to deploy and they're already doing this with SGE, they're going to deploy a relatively basic glorified summarizer model that can answer very basic questions about like current events, who won the Super Bowl, like, you know, what's going on on Capitol Hill, like those types of things. The flip side of that is like more complex questions where like you have to reason and you have to solve problems and like debug code. And we realized like we're much more interested in kind of going along the bleeding edge of that frontier case. And so we've optimized everything that we do for that. And that's a big reason of why we've built Phind specifically for programmers, as opposed to saying like, you know, we're kind of a search engine for everyone because as these models get more capable, we're very interested in seeing kind of what the emergent properties are in terms of reasoning, in terms of being able to solve complex multi-step problems. And I think that some of those emerging capabilities like we're starting to see, but we don't even fully understand. So I think there's always an opportunity for us to become more general if we wanted, but we've been along this path of like, what is the best, most advanced reasoning engine that's connected to your code base, that's connected to the internet that we can just provide. [00:17:39]Alessio: What is Phind today, pragmatically, from a product perspective, how do people interact with it? Yeah. Or does it plug into your workflow? [00:17:46]Michael: Yeah. [00:17:47]Alessio: So Phind is really a system. [00:17:48]Michael: Phind is a system for programmers when they have a question or when they're frustrated or when something's not working. [00:17:54]Swyx: When they're frustrated. [00:17:55]Alessio: Yeah. [00:17:56]Michael: For them to get on block. I think like the single, the most abstract page for Phind is like, if you're experiencing really any kind of issue as a programmer, we'll solve that issue for you in 15 seconds as opposed to 15 minutes or longer. Phind has an interface on the web. It has an interface in VS code and more IDEs to come, but ultimately it's just a system where a developer can paste in a question or paste in code that's not working and Phind will do a search on the internet or they will find other code in your code base perhaps that's relevant. And then we'll find the context that it needs to answer your question and then feed it to a reasoning engine powerful enough to actually answer it. So that's really the philosophy behind Phind. It's a system for getting developers the answers that they're looking for. And so right now from a product perspective, this means that we're really all about getting the right context. So the VS code extension that we launched recently is a big part of this because you can just ask a question and it knows where to find the right code context in your code. It can do an internet search as well. So it's up to date and it's not just reliant on what the model knows and it's able to figure out what it needs by itself and answer your question based on that. If it needs some help, you can also get yourself kind of just, there's opportunities for you yourself to put in all that context in. But the issue is also like not everyone wants these VS code. Some people like are real Neovim sticklers or they're using like PyCharm or other IDEs, JetBrains. And so for those people, they're actually like okay with switching tabs, at least for now, if it means them getting their answer. Because really like there's been an explosion of all these like startups doing code, doing search, etc. But really who everyone's competing with is ChatGPT, which only has like that one web interface. Like ChatGPT is really the bar. And so that's what we're up against. [00:19:50]Alessio: And so your idea, you know, we have Amman from Cursor on the podcast and they've gone through the we need to own the IDE thing. Yours is more like in order to get the right answer, people are happy to like go somewhere else basically. They're happy to get out of their IDE. [00:20:05]Michael: That was a great podcast, by the way. But yeah, so part of it is that people sometimes perhaps aren't even in an IDE. So like the whole task of software engineering goes way beyond just running code, right? There's also like a design stage. There's a planning stage. A lot of this happens like on whiteboards. It happens in notebooks. And so the web part also exists for that where you're not even coding it and you're just trying to get like a more conceptual understanding of what you're trying to build first. The podcast with Amman was great, but somewhere where I disagree with him is that you need to own the IDE. I think like he made some good points about not having platform risk in the long term. But some of the features that were mentioned like suggesting diffs, for example, those are all doable with an extension. We haven't yet seen with VS Code in particular any functionality that we'd like to do yet in the IDE that we can't either do through directly supported VS Code functionality or something that we kind of hack into there, which we've also done a fair bit of. And so I think it remains to be seen where that goes. But I think what we're looking to be is like we're not trying to just be in an IDE or be an IDE. Like Phind is a system that goes beyond the IDE and like is really meant to cover the entire lifecycle of a developer's thought process in going about like, hey, like I have this idea and I want to get from that idea to a working product. And so then that's what the long term vision of Phind is really about is starting with that. In the future, I think programming is just going to be really just the problem solving. Like you come up with an idea, you come up with like the basic design for the algorithm in your head, and you just tell the AI, hey, just like just do it, just make it work. And that's what we're building towards. [00:21:51]Swyx: I think we might want to give people an impression about like type of traffic that you have, because when you present it with a text box, you could type in anything. And I don't know if you have some mental categorization of like what are like the top three use cases that people tend to coalesce around. [00:22:08]Alessio: Yeah, that's a great question. [00:22:09]Michael: The two main types of searches that we see are how-to questions, like how to do X using Y tool. And this historically has been our bread and butter, because with our embeddings, like we're really, really good at just going over a bunch of developer documentation and figuring out exactly the part that's relevant and just telling you, OK, like you can use this method. But as LLMs have gotten better, and as we've really transitioned to using GPT-4 a lot in our product, people organically just started pasting in code that's not working and just said, fix it for me. [00:22:42]Swyx: Fix this. [00:22:43]Alessio: Yeah. [00:22:44]Michael: And what really shocks us is that a lot of the people who do that, they're coming from chat GPT. So they tried it in chat GPT with chat GPT-4. It didn't work. Maybe it required like some multi-step reasoning. Maybe it required some internet context or something found in either a Stack Overflow post or some documentation to solve it. And so then they paste it into find and then find works. So those are really those two different cases. Like, how can I build this conceptually or like remind me of this one detail that I need to build this thing? Or just like, here's this code. Fix it. And so that's what a big part of our VS Code extension is, is like enabling a much smoother here just like fix it for me type of workflow. That's really its main benefits. Like it's in your code base. It's in the IDE. It knows how to find the relevant context to answer that question. But at the end of the day, like I said previously, that's still a relatively, not to say it's a small part, but it's a limited part of the entire mental life cycle of a programmer. [00:23:47]Swyx: Yep. So you launched in Feb and then you launched V2 in August. You had a couple other pretty impactful posts slash feature launches. The web search one was massive. So you were mostly a GPT-4 wrapper. We were for a long time. [00:24:03]Michael: For a long time until recently. Yeah. [00:24:05]Alessio: Until recently. [00:24:06]Swyx: So like people coming over from ChatGPT were saying, we're going to say model with your version of web search. Would that be the primary value proposition? [00:24:13]Michael: Basically yeah. And so what we've seen is that any model plus web search is just significantly better than [00:24:18]Alessio: that model itself. Do you think that's what you got right in April? [00:24:21]Swyx: Like so you got 1500 points on Hacking News in April, which is like, if you live on Hacking News a lot, that is unheard of for someone so early on in your journey. [00:24:31]Alessio: Yeah. [00:24:32]Michael: We're super, super grateful for that. Definitely was not expecting it. So what we've done with Hacker News is we've just kept launching. [00:24:38]Alessio: Yeah. [00:24:39]Michael: Like what they don't tell you is that you can just keep launching. That's what we've been doing. So we launched the very first version of Find in its current incarnation after like the previous demo connected to our own index. Like once we got into YC, we scrapped our own index because it was too cumbersome at the time. So we moved over to using Bing as kind of just the raw source data. We launched as Hello Cognition. Over time, every time we like added some intelligence to the product, a better model, we just keep launching. And every additional time we launched, we got way more traffic. So we actually silently rebranded to Find in late December of last year. But like we didn't have that much traffic. Nobody really knew who we were. [00:25:18]Swyx: How'd you pick the name out of it? [00:25:19]Michael: Paul Graham actually picked it for us. [00:25:21]Swyx: All right. [00:25:22]Alessio: Tell the story. Yeah. So, oh boy. [00:25:25]Michael: So this is the biggest side. Should we go for like the full Paul Graham story or just the name? [00:25:29]Swyx: Do you want to do it now? Or do you want to do it later? I'll give you a choice. [00:25:32]Alessio: Hmm. [00:25:33]Michael: I think, okay, let's just start with the name for now and then we can do the full Paul Graham story later. But basically, Paul Graham, when we were lucky enough to meet him, he saw our name and our domain was at the time, sayhello.so and he's just like, guys, like, come on, like, what is this? You know? And we were like, yeah, but like when we bought it, you know, we just kind of broke college students. Like we didn't have that much money. And like, we really liked hello as a name because it was the first like conversational search engine. And that's kind of, that's the angle that we were approaching it from. And so we had sayhello.so and he's like, there's so many problems with that. Like, like, like the say hello, like, what does that even mean? And like .so, like, it's gotta be like a .com. And so we did some time just like with Paul Graham in the room. We just like looked at different domain names, like different things that like popped into our head. And one of the things that popped into like Paul Graham said was fine with the Phind spelling in particular. [00:26:33]Swyx: Yeah. Which is not typical naming advice, right? Yes. Because it's not when people hear it, they don't spell it that way. [00:26:38]Michael: Exactly. It's hard to spell. And also it's like very 90s. And so at first, like, we didn't like, I was like, like, ah, like, I don't know. But over time it kept growing on us. And eventually we're like, okay, we like the name. It's owned by this elderly Canadian gentleman who we got to know, and he was willing to sell it to us. [00:26:57]Michael: And so we bought it and we changed the name. Yeah. [00:27:01]Swyx: Anyways, where were you? [00:27:02]Alessio: I had to ask. [00:27:03]Swyx: I mean, you know, everyone who looks at you is wondering. [00:27:06]Michael: And a lot of people actually pronounce it Phind, which, you know, by now it's part of the game. But eventually we want to buy Phind.com and then just have that redirect to Phind. So Phind is like definitely the right spelling. But like, we'll just, yeah, we'll have all the cases addressed. [00:27:23]Swyx: Cool. So Bing web search, and then August you launched V2. Is V2 the Phind as a system pitch? Or have you moved, evolved since then? [00:27:31]Michael: Yeah, so I don't, like the V2 moniker, like, I don't really think of it that way in my mind. There's like, there's the version we launched during, last summer during YC, which was the Bing version directed towards programmers. And that's kind of like, that's why I call it like the first incarnation of what we currently are. Because it was already directed towards programmers. We had like a code snippet search built in as well, because at the time, you know, the models we were using weren't good enough to generate code snippets. Even GPT, like the text DaVinci 2 was available at the time, wasn't that good at generating code and it would generate like very, very short, very incomplete code snippets. And so we launched that last summer, got some traction, but really like we were only doing like, I don't know, maybe like 10,000 searches a day. [00:28:15]Alessio: Some people knew about it. [00:28:16]Michael: Some people used it, which is impressive because looking back, the product like was not that good. And every time we've like made an improvement to the way that we retrieve context through better embeddings, more intelligent, like HTML parsers, and importantly, like better underlying models. Every major version after that was when we introduced a better underlying answering model. Like in February, we had to swallow a bit of our pride when we were like, okay, our own models aren't good enough. We have to go to open AI. And actually that did lead to kind of like our first decent bump of traffic in February. And people kept using it, like our attention was way better too. But we were still kind of running into problems of like more advanced reasoning. Some people tried it, but people were leaving because even like GPT 3.5, both turbo and non-turbo, like still not that great at doing like code related reasoning beyond the how do you do X, like documentation search type of use case. And so it was really only when GPT 4 came around in April that we were like, okay, like this is like our first real opportunity to really make this thing like the way that it should have been all along. And having GPT 4 as the brain is what led to that Hacker News post. And so what we did was we just let anyone use GPT 4 on Fyne for free without a login, [00:29:43]Alessio: which I actually don't regret. [00:29:45]Michael: So it was very expensive, obviously. But like at that stage, all we needed to do was show like, we just needed to like show people here's what Fyne can do. That was the main thing. And so that worked. That worked. [00:29:58]Alessio: Like we got a lot of users. [00:29:59]Michael: Do you know Fireship? [00:30:01]Swyx: Yeah. YouTube, Jeff Delaney. [00:30:03]Michael: Yeah. He made a short about Fyne. [00:30:06]Alessio: Oh. [00:30:07]Michael: And that's on top of the Hacker News post. And that's what like really, really made it blow up. It got millions of views in days. And he's just funny. Like what I love about Fireship is like he like you guys, yeah, like humor goes a long a long way towards like really grabbing people's attention. And so that blew up. [00:30:25]Swyx: Something I would be anxious about as a founder during that period, so obviously we all remember that pretty closely. So there were a couple of people who had access to the GPT-4 API doing this, which is unrestricted access to GPT-4. And I have to imagine OpenAI wasn't that happy about that because it was like kind of de facto access to GPT-4 before they released it. [00:30:46]Alessio: No, no. [00:30:47]Michael: GPT-4 was in chat GPT from day one. I think. OpenAI actually came to our support because what happened was we had people building unofficial APIs around to try to get free access to it. And I think OpenAI actually has the right perspective on this where they're like, OK, people can do whatever they want with the API if they're paying for it, like they can do whatever they want, but it's like not OK if, you know, paying customers are being exploite by these other actors. They actually got in touch with us and they helped us like set up better Cloudflare bot monitoring controls to effectively like crack down on those unofficial APIs, which we're very happy about. But yeah, so we launched GPT-4. A lot of people come to the product and yeah, for a long time, we're just we're figuring out like what do we make of this, right? How do we a make it better, but also deal with like our costs, which have just like massively, massively ballooned. Over time, it's become more clear with the release of Llama 2 and Llama 3 on the horizon that we will once again see a return to vertical applications running their own models. As was true last year and before, I think that GPT-4, my hypothesis is that the jump from 4 to 4.5 or 4 to 5 will be smaller than the jump from 3 to 4. And the reason why is because there were a lot of different things. Like there was two plus, effectively two, two and a half years of research that went into going from 3 to 4. Like more data, bigger model, all of the instruction tuning techniques, RLHF, all of that is known. And like Meta, for example, and now there's all these other startups like Mistral too, like there's a bunch of very well-funded open source players that are now working on just like taking the recipe that's now known and scaling it up. So I think that even if a delta exists, the delta between in 2024, the delta between proprietary and open source won't be large enough that a startup like us with a lot of data that we've collected can take the data that we have, fine tune an open source model, and like be able to have it be better than whatever the proprietary model is at the time. That's my hypothesis.Michael: But we'll once again see a return to these verticalized models. And that's something that we're super excited about because, yeah, that brings us to kind of the fine model because the plan from kind of the start was to be able to return to that if that makes sense. And I think now we're definitely at a point where it does make sense because we have requests from users who like, they want longer context in the model, basically, like they want to be able to ask questions about their entire code base without, you know, context and retrieval and taking a chance of that. Like, I think it's generally been shown that if you have the space to just put the raw files inside of a big context window, that is still better than chunking and retrieval. So there's various things that we could do with longer context, faster speed, lower cost. Super excited about that. And that's the direction that we're going with the fine model. And our big hypothesis there is precisely that we can take a really good open source model and then just train it on absolutely all of the high quality data that we can find. And there's a lot of various, you know, interesting ideas for this. We have our own techniques that we're kind of playing with internally. One of the very interesting ideas that I've seen, I think it's called Octopack from BigCode. I don't think that it made that big waves when it came out, I think in August. But the idea is that they have this data set that maps GitHub commits to a change. So basically there's all this really high quality, like human made, human written diff data out there on every time someone makes a commit in some repo. And you can use that to train models. Take the file state before and like given a commit message, what should that code look like in the future? [00:34:52]Swyx: Got it. [00:34:53]Alessio: Do you think your HumanEval is any good?Michael: So we ran this experiment. We trained the Phind model. And if you go to the BigCode leaderboard, as of today, October 5th, all of our models are at the top of the BigCode leaderboard by far. It's not close, particularly in languages other than Python. We have a 10 point gap between us and the next best model on JavaScript. I think C sharp, multilingual. And what we kind of learned from that whole experience releasing those models is that human eval doesn't really matter. Not just that, but GPT-4 itself has been trained on human eval. And we know this because GPT-4 is able to predict the exact docstring in many of the problems. I've seen it predict like the specific example values in the docstring, which is extremely improbable. So I think there's a lot of dataset contamination and it only captures a very limited subset of what programmers are actually doing. What we do internally for evaluations are we have GPT-4 score answers. GPT-4 is a really good evaluator. I mean, obviously it's by really good, I mean, it's the best that we have. I'm sure that, you know, a couple of months from now, next year, we'll be like, oh, you know, like GPT-4.5, GPT-5, it's so much better. Like GPT-4 is terrible, but like right now it's the best that we have short of humans. And what we found is that when doing like temperature zero evals, it's actually mostly deterministic GPT-4 across runs in assigning scores to two different answers. So we found it to be a very useful tool in comparing our model to say, GPT-4, but yeah, on our like internal real world, here's what people will be asking this model dataset. And the other thing that we're running is just like releasing the model to our users and just seeing what they think. Because that's like the only thing that really matters is like releasing it for the application that it's intended for, and then seeing how people react. And for the most part, the incredible thing is, is that people don't notice a difference between our model and GPT-4 for the vast majority of searches. There's some reasoning problems that GPT-4 can still do better. We're working on addressing that. But in terms of like the types of questions that people are asking on find, there's not that much difference. And in fact, I've been running my own kind of side by side comparisons, shout out to GodMode, by the way. [00:37:16]Michael: And I've like myself, I've kind of confirmed this to be the case. And even sometimes it gives a better answer, perhaps like more concise or just like better implementation than GPT-4, which that's what surprises me. And by now we kind of have like this reasoning is all you need kind of hypothesis where we've seen emerging capabilities in the find model, whereby training it on high quality code, it can actually like reason better. It went from not being able to solve world problems, where riddles were like with like temporal placement of objects and moving and stuff like that, that GPT-4 can do pretty well. We went from not being able to do those at all to being able to do them just by training on more code, which is wild. So we're already like starting to see like these emerging capabilities. [00:37:59]Swyx: So I just wanted to make sure that we have the, I guess, like the model card in our heads. So you started from Code Llama? [00:38:07]Alessio: Yes. [00:38:08]Swyx: 65, 34? 34. [00:38:10]Michael: So unfortunately, there's no Code Llama 70b. If there was, that would be super cool. But there's not. [00:38:15]Swyx: 34. And then, which in itself was Llama 2, which is on 2 trillion tokens and the added 500 billion code tokens. Yes. [00:38:22]Michael: And you just added a bunch more. [00:38:23]Alessio: Yeah. [00:38:24]Michael: And they also did a couple of things. So they did, I think they did 500 billion, like general pre-training and then they did an extra 20 billion long context pre-training. So they actually increased the like max position tokens to 16k up from 8k. And then they changed the theta parameter for the ROPE embeddings as well to give it theoretically better long context support up to 100k tokens. But yeah, but otherwise it's like basically Llama 2. [00:38:50]Swyx: And so you just took that and just added data. [00:38:52]Michael: Exactly. [00:38:53]Swyx: You didn't do any other fundamental. [00:38:54]Michael: Yeah. So we didn't actually, we haven't yet done anything with the model architecture and we just trained it on like many, many more billions of tokens on our own infrastructure. And something else that we're taking a look at now is using reinforcement learning for correctness. One of the interesting pitfalls that we've noticed with the Phind model is that in cases where it gets stuff wrong, it sometimes is capable of getting the right answer. It's just, there's a big variance problem. It's wildly inconsistent. There are cases when it is able to get the right chain of thought and able to arrive [00:39:25]Alessio: at the right answer, but not always. [00:39:27]Michael: And so like one of our hypotheses is something that we're going to try is that like we can actually do reinforcement learning on, for a given problem, generate a bunch of completions and then like use the correct answer as like a loss basically to try to get it to be more correct. And I think there's a high chance I think of this working because it's very similar to the like RLHF method where you basically show pairs of completions for a given question except the criteria is like which one is like less harmful. But here we have a different criteria. But if the model is already capable of getting the right answer, which it is, we're just, we just need to cajole it into being more consistent. [00:40:06]Alessio: There were a couple of things that I noticed in the product that were not strange but unique. So first of all, the model can talk multiple times in a row, like most other applications is like human model, human model. And then you had outside of the thumbs up, thumbs down, you have things like have DLLM prioritize this message and its answers or then continue from this message to like go back. How does that change the flow of the user and like in terms of like prompting it, yeah, what are like some tricks or learnings you've had? [00:40:37]Michael: So yeah, that's specifically in our pair programmer mode, which is a more conversational mode that also like asks you clarifying questions back if it doesn't fully understand what you're doing and it kind of it holds your hand a bit more. And so from user feedback, we had requests to make more of an auto GPT where you can kind of give it this problem that might take multiple searches or multiple different steps like multiple reasoning steps to solve. And so that's the impetus behind building that product. Being able to do multiple steps and also be able to handle really long conversations. Like people are really trying to use the pair programmer to go from like sometimes really from like basic idea to like complete working code. And so we noticed was is that we were having like these very, very long threads, sometimes with like 60 messages, like 100 messages. And like those become really, really challenging to manage the appropriate context window of what should go inside of the context and how to preserve the context so that the model can continue or the product can continue giving good responses, even if you're like 60 messages deep in a conversation. So that's where the prioritized user messages like comes from. It's like people have asked us to just like let them pin messages that they want to be left in the conversation. And yeah, and then that seems to have like really gone a long way towards solving that problem, yeah. [00:41:54]Alessio: And then you have a run on Replit thing. Are you planning to build your own repl? Like learning some people trying to run the wrong code, unsafe code? [00:42:03]Michael: Yes. Yes. So I think like in the long term vision of like being a place where people can go from like idea to like fully working code, having a code sandbox, like a natively integrated code sandbox makes a lot of sense. And replit is great and people use that feature. But yeah, I think there's more we can do in terms of like having something a bit closer to code interpreter where it's able to run the code and then like recursively iterate on it. Exactly. [00:42:31]Swyx: So you're working on APIs to enable you to do that? Yep. So Amjad has specifically told me in person that he wants to enable that for people at the same time. He's also working on his own models, and Ghostwriter and you know, all the other stuff. So it's going to get interesting. Like he wants to power you, but also compete with you. Yeah. [00:42:47]Michael: And like, and we love replit. I think that a lot of the companies in our space, like we're all going to converge to solving a very similar problem, but from a different angle. So like replit approaches this problem from the IDE side. Like they started as like this IDE that you can run in the browser. And they started from that side, making coding just like more accessible. And we're approaching it from the side of like an LLM that's just like connected to everything that it needs to be connected to, which includes your code context. So that's why we're kind of making inroads into IDEs, but we're kind of, we're approaching this problem from different sides. And I think it'll be interesting to see where things end up. But I think that in the long, long term, we have an opportunity to also just have like this general technical reasoning engine product that's potentially also not just for, not just for programmers. It's also powered in this web interface, like where there's potential, I think other things that we will build that eventually might go beyond like our current scope. [00:43:49]Swyx: Exciting. We'll look forward to that. We're going to zoom out a little bit into sort of AI ecosystem stories, but first we got to get the Paul Graham, Ron Conway story. [00:43:59]Alessio: Yeah. [00:44:00]Michael: So flashback to last summer, we're in the YC batch. We're doing the summer batch, summer 22. So the summer batch runs from June to September, approximately. And so this was late July, early August, right around the time that many like YC startups start like going out, like during up, here's how we're going to pitch investors and everything. And at the same time, me and my co-founder, Justin, we were planning on moving to New York. So for a long time, actually, we were thinking about building this company in New York, mainly for personal reasons, actually, because like during the pandemic, pre-ChatGPT, pre last year, pre the AI boom, SF unfortunately really kind of, you know, like lost its luster. Yeah. Like no one was here. It was far from clear, like if there would be an AI boom, if like SF would be like... [00:44:49]Alessio: Back. [00:44:50]Michael: Yeah, exactly. Back. As everyone is saying these days, it was far from clear. And so, and all of our friends, we were graduating college because like we happened to just graduate college and immediately start YC, like we didn't even have, I think we had a week in between. [00:45:06]Swyx: You didn't bother looking for jobs. You were just like, this is what we want to do. [00:45:08]Michael: Well, actually both me and my co-founder, we had jobs that we secured in 2021 from previous internships, but we both, funny enough, when I spoke to my boss's boss at the company at where I reneged my offer, I told him we got into YC, they actually said, yeah, you should do YC. [00:45:27]Swyx: Wow. [00:45:28]Alessio: That's very selfless. [00:45:29]Swyx: That was really great that they did that. But in San Francisco, they would have offered to invest as well. [00:45:33]Michael: Yes, they would have. But yeah, but we were both planning to be in New York and all of our friends were there from college at this point, like we have this whole plan where like on August 1st, we're going to move to New York and we had like this Airbnb for the month of New York. We're going to stay there and we're going to work and like all of that. The day before we go to New York, I called Justin and I just, I tell him like, why are we doing this? Because in our batch, by the time August 1st rolled around, all of our mentors at YC were saying like, hey, like you should really consider staying in SF. [00:46:03]Swyx: It's the hybrid batch, right? [00:46:04]Michael: Yeah, it was the hybrid batch, but like there were already signs that like something was kind of like afoot in SF, even if like we didn't fully want to admit it yet. And so we were like, I don't know, I don't know. Something kind of clicked when the rubber met the road and it was time to go to New York. We're like, why are we doing this? And like, we didn't have any good reasons for staying in New York at that point beyond like our friends are there. So we still go to New York because like we have the Airbnb, like we don't have any other kind of place to go for the next few weeks. We're in New York and New York is just unfortunately too much fun. Like all of my other friends from college who are just, you know, basically starting their jobs, starting their lives as adults. They just stepped into these jobs, they're making all this money and they're like partying and like all these things are happening. And like, yeah, it's just a very distracting place to be. And so we were just like sitting in this like small, you know, like cramped apartment, terrible posture, trying to get as much work done as we can, too many distractions. And then we get this email from YC saying that Paul Graham is in town in SF and he is doing office hours with a certain number of startups in the current batch. And whoever signs up first gets it. And I happen to be super lucky. I was about to go for a run, but I just, I saw the email notification come across the street. I immediately clicked on the link and like immediately, like half the spots were gone, but somehow the very last spot was still available. And so I picked the very, very last time slot at 7 p.m. semi-strategically, you know, so we would have like time to go over. And also because I didn't really know how we're going to get to SF yet. And so we made a plan that we're going to fly from New York to SF and back to New York in one day and do like the full round trip. And we're going to meet with PG at the YC Mountain View office. And so we go there, we do that, we meet PG, we tell him about the startup. And one thing I love about PG is that he gets like, he gets so excited. Like when he gets excited about something, like you can see his eyes like really light up. And he'll just start asking you questions. In fact, it's a little challenging sometimes to like finish kind of like the rest of like the description of your pitch because like, he'll just like asking all these questions about how it works. And I'm like, you know, what's going on? [00:48:19]Swyx: What was the most challenging question that he asked you? [00:48:21]Michael: I think that like really how it worked. Because like as soon as like we told him like, hey, like we think that the future of search is answers, not links. Like we could really see like the gears turning in his head. I think we were like the first demo of that. [00:48:35]Swyx: And you're like 10 minutes with him, right? [00:48:37]Michael: We had like 45, yeah, we had a decent chunk of time. And so we tell him how it works. Like he's very excited about it. And I just like, I just blurted out, I just like asked him to invest and he hasn't even seen the product yet. We just asked him to invest and he says, yeah. And like, we're super excited about that. [00:48:55]Swyx: You haven't started your batch. [00:48:56]Michael: No, no, no. This is about halfway through the batch or two, two, no, two thirds of the batch. [00:49:02]Swyx: And you're like not technically fundraising yet. We're about to start fundraising. Yeah. [00:49:06]Michael: So we have like this demo and like we showed him and like there was still a lot of issues with the product, but I think like it must have like still kind of like blown his mind in some way. So like we're having fun. He's having fun. We have this dinner planned with this other friend that we had in SF because we were only there for that one day. So we thought, okay, you know, after an hour we'll be done, you know, we'll grab dinner with our friend and we'll fly back to New York. But PG was like, like, I'm having so much fun. Do you want to have dinner? Yeah. Come to my house. Or he's like, I gotta go have dinner with my wife, Jessica, who's also awesome, by the way. [00:49:40]Swyx: She's like the heart of YC. Yeah. [00:49:42]Michael: Jessica does not get enough credit as an aside for her role. [00:49:46]Swyx: He tries. [00:49:47]Michael: He understands like the technical side and she understands people and together they're just like a phenomenal team. But he's like, yeah, I got to go see Jessica, but you guys are welcome to come with. Do you want to come with? And we're like, we have this friend who's like right now outside of like literally outside the door who like we also promised to get dinner with. It's like, we'd love to, but like, I don't know if we can. He's like, oh, he's welcome to come too. So all of us just like hop in his car and we go to his house and we just like have this like we have dinner and we have this just chat about the future of search. Like I remember him telling Jessica distinctly, like our kids as kids are not going to know what like a search result is. Like they're just going to like have answers. That was really like a mind blowing, like inflection point moment for sure. [00:50:34]Swyx: Wow, that email changed your life. [00:50:35]Michael: Absolutely. [00:50:36]Swyx: And you also just spoiled the booking system for PG because now everyone's just going to go after the last slot. Oh man. [00:50:42]Michael: Yeah. But like, I don't know if he even does that anymore. [00:50:46]Swyx: He does. He does. Yeah. I've met other founders that he did it this year. [00:50:49]Michael: This year. Gotcha. But when we told him about how we did it, he was like, I am like frankly shocked that YC just did like a random like scheduling system. [00:50:55]Alessio: They didn't like do anything else. But, um. [00:50:58]Swyx: Okay. And then he introduces Duron Conway. Yes. Who is one of the most legendary angels in Silicon Valley. [00:51:04]Michael: Yes.So after PG invested, the rest of our round came together pretty quickly. [00:51:10]Swyx: I'm, by the way, I'm surprised. Like it's, it might feel like playing favorites right within the current batch to be like, yo, PG invested in this one. Right. [00:51:17]Alessio: Too bad for the others. [00:51:18]Swyx: Too bad for the others, I guess. [00:51:19]Michael: I think this is a bigger point about YC and like these accelerators in general is like YC gets like a lot of criticism from founders who feel like they didn't get value out of it. But like, in my view, YC is what you make of it. And YC tells you this. They're like, you really got to grab this opportunity, like buy the balls and make the most of it. And if you do, then it could be the best thing in the world. And if you don't, and if you're just kind of like a passive, even like an average founder in YC, you're still going to fail. And they tell you that. They're like, if you're average in your batch, you're going to fail. Like you have to just be exceptional in every way. With that in mind, perhaps that's even part of the reason why we asked PG to invest. And so yeah, after PG invested, the rest of our round came together pretty quickly, which I'm very fortunate for. And yeah, he introduced us to Ron. And after he did, I get a call from Ron. And then Ron says like, hey, like PG tells me what you're working on. I'd love to come meet you guys. And I'm like, wait, no way. And then we're just holed up in this like little house in San Mateo, which is a little small, but you know, it had a nice patio. In fact, we had like a monitor set up outside on the deck out there. And so Ron Conway comes over, we go over to the patio where like our workstation is. And Ron Conway, he's known for having like this notebook that he goes around with where he like sits down with the notebook and like takes very, very detailed notes. So he never like forgets anything. So he sits down with his notebook and he asks us like, hey guys, like, what do you need? And we're like, oh, we need GPUs. Back then, the GPU shortage wasn't even nearly as bad as it is now. But like even then, it was still challenging to get like the quota that we needed. And he's like, okay, no problem. And then like he leaves a couple hours later, we get an email and we're CC'd on an email that Ron wrote to Jensen, the CEO of Nvidia, saying like, hey, these guys need GPUs. [00:53:02]Swyx: You didn't say how much? It was just like, just give them GPUs. [00:53:04]Alessio: Basically, yeah. [00:53:05]Michael: Ron is known for writing these like one-liner emails that are like very short, but very to the point. And I think that's why like everyone responds to Ron. Everyone loves Ron. And so Jensen responds. He responds quickly, like tagging this VP of AI at Nvidia. And we start working with Nvidia, which is great. And something that I love about Nvidia, by the way, is that after that intro, we got matched with like a dedicated team. And at Nvidia, they know that they're going to win regardless. So they don't care where you get the GPUs from. They're like, they're truly neutral, unlike various sales reps that you might encounter at various like clouds and, you know, hardware companies, et cetera. They actually just want to help you because they know they don't care. Like regardless, they know that if you're getting Nvidia GPUs, they're still winning. So I guess that's a tip is that like if you're looking for GPUs like Nvidia, they'll help you do it. [00:53:54]Swyx: So just to tie up this thing, because so first of all, that's a fantastic story. And I just wanted to let you tell that because it's special. That is a strategic shift, right? That you already decided to make by the time you met Ron, which is we are going to have our own hardware. We're going to rack him in a data center somewhere. [00:54:11]Michael: Well, not even that we need our own hardware because actually we don't. Right. But we just we just need GPUs, period. And like every cloud loves like they have their own sales tactics and like they want to make you commit to long terms and like very non-flexible terms. And like there's a web of different things that you kind of have to navigate. Nvidia will kind of be to the point like, OK, you can do this on this cloud, this on this cloud. Like this is your budget. Maybe you want to consider buying as well. Like they'll help you walk through what the options are. And the reason why they're helpful is because like they look at the full picture. So they'll help you with the hardware. And in terms of software, they actually implemented a custom feature for us in Faster Transformer, which is one of their libraries.Swyx: For you? [00:54:53]Michael: For us. Yeah. Which is wild. I don't think they would have done it otherwise. They implemented streaming generation for T5 based models, which we were running at the time up until we switched to GPT in February, March of this year. So they implemented that just for us, actually, in Faster Transformer. And so like they'll help you like look at the complete picture and then just help you get done what you need to get done. I know one of your interests is also local models, open source models and hardware kind of goes hand in hand.Alessio: Any fun projects, explorations in the space that you want to share with local llamas and stuff? [00:55:27]Michael: Yeah, it's something that we're very interested in because something that kind of we're hearing a lot about is like people want something like find, especially comp

#DoorGrowShow - Property Management Growth
DGS 219: I Didn't Know What I Didn't Know with Michael Sullivan

#DoorGrowShow - Property Management Growth

Play Episode Listen Later Oct 13, 2023 33:58


Michael Sullivan is a property management entrepreneur who has grown his business to 275 doors. Join property management growth experts Jason and Sarah Hull as they chat with former DoorGrow client Michael Sullivan to learn about his experience starting and growing a property management business. You'll Learn [01:44] Getting started in the property management industry [07:49] Growing a property management business [24:01] Having support and feeling fulfilled in the business [28:13] Growing and scaling to the next level Tweetables “To go faster, you need to invest the currency of cash if you want to get more of the other currencies and to get the business to the next level.” “If you're not making mistakes, you're not learning.” “A lot of us business owners, we have a bit of ego.” “Being an entrepreneur can be one can be very lonely, and it is really important to have people in the same industry kind of in your village.” Resources DoorGrow and Scale Mastermind DoorGrow Academy DoorGrow on YouTube DoorGrowClub DoorGrowLive TalkRoute Referral Link Transcript [00:00:00] Jason: To go faster, you need to invest the currency of cash. If you want to get more of the other currencies and to get the business to the next level. Welcome DoorGrow hackers to the DoorGrowShow. If you are a property management entrepreneur that wants to add doors, make a difference, increase revenue, help others, impact lives, and you are interested in growing in business and life, and you're open to doing things a bit differently then you are a DoorGrow hacker. DoorGrow hackers love the opportunities, daily variety, unique challenges, and freedom that property management brings. Many in real estate think you're crazy for doing it. You think they're crazy for not because you realize that property management is the ultimate, high trust gateway to real estate deals, relationships, and residual income. At DoorGrow, we are on a mission to transform property management business owners and their businesses. We want to transform the industry, eliminate the BS, build awareness, change perception, expand the market, and help the best property management entrepreneurs win. I'm your host, property management, growth expert, Jason Hull, the founder and CEO of DoorGrow, along with Sarah Hull, the co owner and CEO of DoorGrow. [00:01:09] Now let's get into the show and our guest today is Michael L Sullivan. Michael Sullivan is here hanging out with us. He is a client of ours and of Sullivan property management. Did I say that right? MLS ullivan property management. All right, your initials. Got it. And Michael, welcome to the show.  [00:01:33] Michael: Thank you. Thank you very much. Good to be here.  [00:01:36] Jason: We're glad to have you. So we've really enjoyed having you in our program and it's been really amazing seeing your progress. So maybe to kick things off, let's start with talking about how you got into this crazy industry of property management. Like you woke up when you were like maybe five years old and said "property management is the thing for me" maybe. [00:01:57] Michael: Yeah, like every little boy and girl, dreams about being a real estate agent or a property manager.  [00:02:03] Jason: It's right there next to veterinarian and firefighter. [00:02:06] Michael: I think that's right. That's right or professional baseball player so, I left the teaching profession in 1993 and became a real estate agent, a general brokerage real estate agent here in the Greater Research Triangle region of North Carolina, and I did very well. I, on average, sold anywhere between 5 and 15 million dollars worth of real estate when our average sale price was $150,000. Yeah, we were shifting a lot of shacks, and it was a good life. And for the 15 or so years between 1993 and the Great Recession of 2007, 2008, my biggest fear was, "what is going to happen when the market flips?" Because inevitably, real estate flips. It goes from a boom market to a bust market, a buyer's market to a seller market. And so during those years, I socked away cash. When the market crashed in 2008, I had an inventory of 40 general brokerage homes that were for sale. I had clients that were still moving to Massachusetts or Plano, Texas, or Austin, or Seattle, you know, to the other tech hubs in the United States and my clients were like, "All right, problem solver, what are you going to do because we still have to move?" And I was like, "we're going to rent them." And so with an Excel spreadsheet and time, because I had lots of time then I started managing property and in the first year, our goal was 30 homes and we had 50 and it was me and one part time assistant and an Excel spreadsheet. Well, after about 18 months, that didn't work anymore. So I went out and I found what I thought was a reasonable property management software. And then over the course of the next decade or so, we got up to 110 properties or so and things were good, you know, we were chugging along and profits were good, but I really didn't know what I didn't know, I kind of. [00:04:22] Believe that once you had an Appfolio or a Buildium on board that you had won the day and that your business was set and you know, it should be easy. And I soon discovered when I got to 115 doors and just kind of got stuck there that the business wasn't growing the way it should be. And I couldn't figure out why. I was on Facebook one day. And there was this guy, Jason Hull, talking about this company called DoorGrow. And so I did the click, click, clickety click. And then I started listening to some of his podcasts and I started researching DoorGrow and I thought, " huh, this guy knows a whole lot about this industry and maybe this is someone I need to engage with." and so that's how I came to DoorGrow about two and a half years ago, I think.  [00:05:21] Jason: And now you're on one, you're on one of the podcasts.  [00:05:24] Michael: I know.  [00:05:25] Jason: So what challenges did you start to realize you were dealing with at the time? Because generally, you've made a ton of changes in your business since working with us, and you know, it's been impressive to watch. What do you feel like were your challenges at that time? Like, what did you not know that you did not know? So  [00:05:43] Michael: I knew that there were currencies in a business, but I didn't know that there were five of them. And I knew that I was working really hard. So the currency of effort was there. Yeah, my bank account showed me that the currency of cash was there. Yeah, the currency of focus was really lacking because I was still doing a lot of general brokerage and still trying to do property management. The focus of energy was lacking. Because it was draining me kind of going in these different directions. And then there was a lack of time. I didn't have time to take off. I didn't have time to turn it off because it was me and an assistant property manager at that time, I was still doing all of the day to day operations and the round pegs in the round holes work. And figuring out those currencies and how to better divide them and focus on them was one of the things that I didn't know and that once I could put a name to it and once I could focus on fixing where there was a deficiency, then I kind of won the battle. I felt, you know, before you launched all of your different systems to help property managers, I listened to you and I went out and got Lead Simple. I went out and got Property Meld and kind of brought them into the fold. And I recognize that those tools, which you paid dearly for using these outside vendors, really bring you a wealth of time that didn't exist before. So I was able to capture that currency and by extension, the currency of effort was able to kind of tamp down because I had systems now in place to deal with the endless maintenance requests that having a practice that. Goes up over a hundred percent in growth is going to require.  [00:07:48] Jason: So let's talk about that growth. You had mentioned you'd gotten up to maybe, where were you when you started with DoorGrow?  [00:07:56] 118. [00:07:58] 118. Okay.  [00:07:59] And where are you at right now?  [00:08:01] Michael: 275.  [00:08:03] Jason: I mean, it sounds like you had pretty decent profit margin before. Well, what was that? If you don't mind sharing, what is it? [00:08:09] Michael: So, on a gross per door basis, when I joined DoorGrow, we were right at about $122 a door per month. Yeah. And today we're up. $153 and 82 cents per door per month.  [00:08:26] Jason: That's very specific. So, you know, your numbers, which is good.  [00:08:30] Michael: Well I try. Yeah. And year over year revenue increases from last year is up 58.7%.  [00:08:36] Jason: Wow. That's awesome. So money's up. So the cash currency has improved the focus currency. Have you been able to do less in the business and narrow your focus?  [00:08:48] Michael: Yes. So Saturday is my benchmark. I call it my Zen day. And if Saturday can be a Zen day for me, where I don't feel like I have tasks that I have to accomplish, that I can do the things that I want to do, still working on the business, not in the business, then I feel like the week has been a win. If I feel like there are pressing tasks that I have to work on within the business on Saturday, then I feel like the week has not been a win. So if Saturday is Zen, if I come into it feeling very kind of centered and relaxed, then I feel like things are in balance the way they should be. [00:09:34] Jason: So what percent profit margin are you operating at now?  [00:09:37] Michael: So coming into this year 2022, we were at 27 percent profit margin, but a lot of that was really underpinned by very robust general brokerage sales. I made a concerted effort this year to pour gasoline on the fire to really grow the business. The goal is to be over 300 doors by the end of the year. So we're 25 away. Nice. I'm pretty sure we're going to make that, you know, that goal. But our profit margin right now is at. 11 and a half, 11 and three quarters percent. So it's down substantially, but that was deliberate.  [00:10:14] Jason: Got it. And is deliberate because  [00:10:18] Michael: why? [00:10:18] Because we're making an investment in people. We're making an investment in systems and we're making an investment in things like vehicles and computers and marketing.  [00:10:30] Jason: Yeah. So I think that's an important thing for business owners to recognize that. To go faster, you need to invest the currency of cash if you want to get more of the other currencies and to get the business to the next level. And you can grow faster if you have thinner margins, which can feel a little more dangerous. And you know, if you're investing into the growth of the business and into the future, but you know how to add doors, so this isn't a concern for you. [00:10:57] Michael: It isn't. My bookkeeper and my accountant were a little apoplectic until I told them like, this is where we're going. And what I said to my bookkeeper was before the great depression of 1929, Ford motor company was the preeminent motor car company in the world. They had an amazing market share. Then the stock market crashed and the economy tanked and Ford circled the wagons, folded their tents and got very conservative. They scaled back. General Motors, by extension, said, "ah," and they saw it as an opportunity and they poured gasoline on the fire. And for the next 70 years, General Motors was the dominant car company in the world. And so I kind of am using that model.  [00:11:47] Jason: Yeah. So, now a lot of people listening to this might think, well, cool, I can get Property Meld, I can do something, you know, get something like Lead Simple, or we have a better tool now, which is DoorGrow Flow. " I can go and get tools and maybe I can do it on my own." Because I think this is the challenge. A lot of us business owners, we have a bit of ego. " I've made a lot of mistakes in the past and we think I can do it myself. Maybe if I watch enough YouTube videos, listen to enough podcast episodes, I can figure it all out on my own. I don't need DoorGrow or I don't need it." Like, so what would you say to people that listening to this or thinking that?  [00:12:22] Michael: So I would say to them, when I think back to me and one assistant and 115, 110 doors and good profit margins. You know, and a good life. I was in a really kind of felt very isolated and very alone I didn't have other friends or colleagues in the property management space that I could talk to. I felt like I was the only person in the world that was doing this, and once I joined DoorGrow and made very valuable, long lasting friends within the organization that I can call on off hours to discuss specific problems related to property management, that burden of feeling on my own and alone disappeared. Being an entrepreneur can be one can be very lonely, and it is really important to have people in the same industry kind of in your village. And that's why that's 1 of the benefits of joining DoorGrow is that I can call friends in Texas, Idaho, Pennsylvania, California and say, "hey, I've got this going on. What do you think?"  [00:13:40] Jason: Yeah, and I think you know, that's a testament to you is that you've been such a contributor that in the mastermind that it's allowed you to connect with all of these people, you know, there are some people that join the program and they still stay somewhat isolated. They're like, "I'm going to watch videos I'm going to learn stuff and do my own thing and they maybe don't get some of those advantages or benefits But I think that's key. [00:14:02] So yeah Yes. I mean, Sarah, when she had her property management business, I imagine you experienced some of the same sort of things of thinking it's. You know, this is, you're the only one in the world doing this. You're on your own.  [00:14:17] Sarah: Yeah, very much. And especially in the area that I was in I was always different and I just kind of do things differently and I think differently and oftentimes people are like, she's nuts, like, why would you do that? [00:14:29] Even my mom, sometimes she's like, are you sure you're going to do that? Like, are you sure? Like, I'm kind of nervous. But I've just always done things a little differently. And it's so, it is really lonely. And I think the mindset that I had back when I was in Pennsylvania versus, you know, the mindset I have now really has a lot to do with who you surround yourself with and that can. [00:14:53] I think it can just give you hope and it can show you like, Hey, like, I'm not so crazy. Like I've got it. Like I've got it figured out and I'm like doing the right thing and I'm on the right path. And you know, it feels right, but sometimes it's just, you know, you're like, Oh, is this really right? [00:15:07] Because it feels good to me, but man, everybody else is doing something so different.  [00:15:12] Michael: Yeah. And that's another benefit that DoorGrow has given me is. I now have the ability to say no. So I am the business development manager. I have someone in charge of maintenance. I have someone in charge of tenant experience. [00:15:28] I have someone in charge of ops within the office. They color within their lines and we are good. My job is to go out and build the business to work on the business, not work in the business. And until I joined DoorGrow, it didn't matter what came my way. Property wise, I was going to take it last week. I turned away more properties than we took on because they weren't the right fit. [00:15:53] And I have a very nice conversation with prospective clients about qualification and that they're qualifying us to make sure we're a good fit for them. But at the same time. I'm qualifying them, their mindset, their properties, their attitudes toward spending money, their attitudes toward maintaining their properties, and if those things don't align with what we believe here, that housing is a human right that people have the right to live in nice homes that are maintained and maintained properly, then We're not going to accept the business. [00:16:30] We're also not going to accept people that are rude, mean and abusive. Because I've learned since kind of letting the stress of being a general brokerage real estate agent. Slip away that there is plenty of good business out there and that it's more important to have the Philosophical fits with the business than it is to take just any property no matter what the cost  [00:16:57] Jason: Yeah, your ability to say no in business Gives you a business that you feel you can easily say yes to each  [00:17:03] Michael: day. [00:17:04] That's right.  [00:17:05] Jason: Yeah. Yeah. It's nice to not have to wake up and go, man, I really don't want to do this today. And that's because we're setting boundaries for ourselves and that boundary in those containers allow us to create a business that we really like to be inside.  [00:17:20] Michael: Right. That's correct. Yeah. Now,  [00:17:22] Jason: when you came. [00:17:23] To us DoorGrow initially. I remember like you really had this mindset that you, and now you're doing business development, you had mentioned, you really believed you were the operator. It all was on your shoulders to operate the business, do operations, and you were good at it, but you believe that was your primary gift, I think, to the business and what your contribution needed to be. [00:17:45] And and I know you had some conversations with Sarah and some shifts in that, so could you touch on that a bit?  [00:17:51] Michael: Yeah well, control freak and always have been a control freak. I know one of those. You know, own it. And to a certain degree, I still, I observe. I trust and verify, but I don't get involved. [00:18:07] My number two said it best the other day. He said, yeah, with you. I only have to come to you if I know it's a problem that I can't solve. So I have kind of empowered the people who work with me to color in their lines. And when they are in trouble, come here and ask and we'll figure it out. I have also given them permission to make mistakes because if you're not making mistakes, you're not learning. You're static, and I let them see that I make mistakes and that I admit when I make a mistakes above all else. I expect complete honesty here. We make mistakes. We admit our mistakes. You know, if we have to eat it because it's a financial error that we've made well, then by golly, we're going to eat it because it was our mistake. And we come by it honestly the empowerment of becoming a business development manager is I don't have to worry that the books are balanced every week because I know that there is someone who I've paid good money to who has balanced the books and they can't hide because the system has been created where I can see that it's been uploaded into the accounting software and that the books are in balance. [00:19:25] I can verify that the financial piece of the puzzle in the business is running properly because I get a report monthly from my accountant and my bookkeeper that says, "this is where we are. This is your cash flow. This is your profit. This is where you're spending a lot of money. Are you okay with that?" and I pay them good money to do those things. I have a maintenance coordinator who deals with maintenance and on the Property Meld dashboard, which I log into every morning. I can see the tasks picking off or I can see things progressing and I can see that we're handling our maintenance requests in 3 to 4 days on average and that's fine. I've also told him to maintain his sanity because he's a bit of a control freak. If it's after hours and it's a garbage disposal in a dishwasher and it's after 5 o'clock, you don't need to deal with that today. If it's a leak and we have a catastrophe, then you deal with that after five o'clock, but the small stuff can wait until tomorrow. [00:20:26] It's still important. It's important to get it done and move it off our plates, but you don't have to deal with it when you need to be spending time with your children at soccer camp or baseball practice or whatever he does in the evening with his four kids. And then my other teammates, I can see that they are moving their tasks forward and that I don't have to worry about the job that they're doing. And that's empowered me to go out and find the right properties to bring into the practice for us to manage.  [00:20:56] Jason: You know, one of the gifts that I see in you, which I think really sets you apart, Michael, is coming into the program you're really intelligent. You know this. You're an intelligent guy. I think everybody can pick that up just by hearing you and listening to you. But even though you're intelligent, you have humility about, you know, and this openness to learning. And you've come into the program and you just started to do stuff. Like you tried it out. You experimented, and you allowed yourself the time to prove whether or not it would work or not. And some of the times we get clients that are intelligent, but they're not humble and they're usually the biggest stumbling block to themselves. So I just wanted to point that out. I'm curious what Sarah's experience has been of you as well, because she worked closely with you on like reviewing some of the systems, reviewing your team assessing you and some of this kind of stuff. [00:21:54] Sarah: So, yeah, I think I definitely agree with what you just said about being open to learning and trying things just a bit differently. And I think a lot of entrepreneurs, we do things differently. We're okay with that. But sometimes if it's not our idea, then we're like "I don't know if I want to do it because I didn't think of it." right. So, I think Michael is, he's open to thinking differently. He's open to trying things out and implementing a system. He'll do the research. He doesn't just, you know, blindly jump and he's like, well, Jason said to do this, so I'm going to do it, but he'll do the research and he's very thorough. And I really appreciate that about Michael. He's all into the details and he knows exactly what's going on in his business. He's not like, "Hey, I'm just going to kind of sit back and like, let the team run everything, and then I just, I'm going to cross my fingers and hope and pray that everything is going well, right?" like we know that it's going well because you're not the one who's doing it, so you've been able to get out of the hot seat in a lot of different ways and get yourself more into the things that you actually enjoy. because I remember that conversation with you about the operations and you said, "well, I really just, I love to sell" like, okay, then let's let you sell. Like if you're doing things in the business and you're just holding on to them going, "well, I have to be the one to do this." I think it's really common for us to think that like, " well, I own the business, so I have to do this piece or I own this. And it has to be me. It doesn't always have to be you." do you have to know what's going on? Absolutely. Do you have to have the right people on your team? Absolutely. And do you have to set it up so that things can run smoothly? Absolutely. But do you have to be the one who's actually like doing the work? Right. And I think that's one of the biggest shifts that I've seen in you is that you're able to say, okay I don't have to do this part and I don't want to do this part. [00:23:54] This is where I want to be. So I'm going to move closer to this and I'm going to figure out how to get these pieces kind of offloaded.  [00:24:01] Michael: Yeah. Yeah. When you taught me how to write R docs and after I had a disastrous hire two years ago, disaster, and I had to fire someone, something I'd never had to do, but it was my fault. There was nothing wrong with the person I hired. She was just the wrong fit for the job. And then we sat down, we wrote R docs. With detailed job descriptions and parameters and that made bringing on the next person who is now in that role a dream because she fit the culture. We knew what her profile was before she even interviewed with us. We knew who the person was and then she walked through the door and poof, there she was. And that's one thing I didn't know. I just thought you could teach someone into a position. Well, you can teach skills, but you can't teach the human touch. And that's what I had missed with the disaster, the mistake that I made.  [00:25:02] Jason: Yeah. You'd learn some concepts from us, like the three fits , mapping out R docs. One of you explain what R docs are for those of us. This is DoorGrow speak here.  [00:25:11] Sarah: I know it is. So an R doc, it's just basically a fancy word for job description. We call it R doc because every section on it starts with 'R.' [00:25:20] Jason: There you go. So the ultimate job descriptions. Awesome. So, yeah, so all of these little pieces and systems and mindsets that you've installed in your business have really, I think, primed your business for a lot of growth. Like, where do you see the business going in the future?  [00:25:37] Michael: Oh, so that's another thing I learned. And it was at, I think, Austin at the Austin meeting. And it was you said it in the first like two minutes and I got my nugget and I was like, okay, I can go home. I got it. You said, don't limit your growth. And I had constantly said 200 doors, 200 doors. That's where I'm going. That's where I'm going. And you already passed that now. Yeah, you said that. And I was like. " Why would I create like this false ceiling that I'm going to just bump into and stop at?" Yeah. So, ultimately, and I'd like to retire in the next 10 to 12, 15 years, maybe. We're realistically thinking in the neighborhood of 1,000-2,000 doors. Yeah, people have started to come a calling about, "Hey, do you want to sell your business?" And the time is not right. Some of the financial offers that have been made already are very intriguing. Yeah. But then I'm like, " what will I do with myself?" You know, "what's the next iteration?" And I think until I figure that out, we're going to just stay the course. [00:26:47] Jason: Yeah, I think that's one of the key things that I think a lot of people realize in the program that if it was just about money, then maybe you'd cash out, but it's not just about money, right? There's other things we want out of our experience here on this planet. And that's something else you got a lot of clarity on is what really personally drives you, which allowed you to build the business and the team around you so that you really could move into those plus signs and out of those minus signs. [00:27:13] Michael: Yeah, so the key is I went to the Netherlands in May to see art because it's my thing. Cool. And a little ostentatious to fly to Europe to see Vermeer, but I did it. And I was gone for a good long time and things here chugged right along and it was beautiful. And I knew then that we were doing things right, that I could leave and not be here for 10 days, and the business continued to operate. I continued to watch and check in. But they didn't need me.  [00:27:49] Jason: And how's that different from before you came to DoorGrow?  [00:27:53] Michael: Oh my God. Like the first meeting in Austin that I came to, I had I came really close to not coming because I was like "I can't leave. I just can't leave. I can't leave them." I was wrong. I was wrong and I went to Austin and I went to Vegas and you know, things were good. Yeah.  [00:28:12] Jason: Yeah. So awesome. Well, it's been really cool to see your progress. We really appreciate. Seeing your growth and yeah, there's no question in my mind. A lot of people hear you say, Oh, maybe a thousand, 2000 doors. And they probably think: this guy is ridiculously off his rocker that he could just believe that and the audacity to have that mindset. And I'm sure when you first came to DoorGrow, a thousand doors was like, probably magic, some magic, like pipe dream in the ethers that you would never even consider. I don't know, but. [00:28:40] Michael: 300 seemed unimaginable.  [00:28:43] Jason: Yeah, but now it seems very doable. And you're aware of the DoorGrow code and like we've got clients breaking a thousand doors. We've got clients doing it. And there's no question in my mind. You could easily do this in the next two to three years. If you really wanted to easily.  [00:28:57] Michael: Yeah, I work my golden 100. That's another thing I learned at DoorGrow. To have people that are valuable people that I love and care about that. I have to touch every 30 days because they love and care about me and buy it. So they send business. They ask questions and we share information. Yeah. And for that, I'm indebted to you.  [00:29:19] Jason: Not at all. Well, great. Well, yeah we, it's been really awesome seeing your growth. So cool. Anything else we should ask Michael? We've got him hanging out here with us. What's next for you, Michael? What's next?  [00:29:31] Michael: Well, once we go over 300, then the double it again. [00:29:34] Jason: Yeah. So what I see next for you is you've got some of the systems installed. And then I think what it will be next is to level up your three key systems of. People, process, and planning and maybe starting to build out even a little bit more of that executive team. I think you've got a good team going now and I think then what would be next would be maybe starting to acquire you'll be the one eating up some of these other companies. And I think, maybe working with us on acquisitions, and I think that'll be the quick pace to grow. And that also bring you really great people too, if you want. So [00:30:07] Michael: we're working on two. They're on a slow simmer because companies that I'm looking at have some. Bookkeeping issues. We'll just put it at that.  [00:30:17] Jason: It's an opportunity. Yeah. Always do.  [00:30:20] Michael: So we may be able to fix the problem. Definitely.  [00:30:24] Jason: You'll be able to fix the problem. Yeah. Yeah. Very cool. Well, I'm excited to see what you do in the future. I know like, I've seen companies hit all these different stages. I know. We know the challenges that you're going to hit at these different stages in growth. We're here to support you. And for those listening here on the DoorGrowShow if you are struggling, you're hitting some of these sticking points, these milestones, you're stuck in your mindset, whatever. Be like Michael, be like Mike, not Mike, but all the reference, be like Michael and you know, talk to us and let us map things out with you and see if we could help you out. We'll be sure with you. So, well, Michael, appreciate you coming on the show. We appreciate having you as a client and grateful for you.  [00:31:09] Michael: Thank you. Thanks. I appreciate it. Have a good day.  [00:31:12] Jason: All right. Cool. So, if you're wanting to get into our free community of property management entrepreneurs on Facebook, go to DoorGrowClub.Com. We have some free gifts that we want to give to you. You'll provide your email as you join the group, we'll give you an, a drip, an email drip of some free gifts, including a fee Bible and some vendors that you can use and some different tools just to help you help yourself and help the industry level up. [00:31:42] And we, and if you provide your info, we will also reach out to see if you'd like to have a conversation with us and see if we could help you grow your business, which the answer usually is. Yes, we can. So we would love to support you and help you out. And if you're wanting to test out your website, which you think might be amazing, go to doorgrowcom/quiz and test your website. A lot of times, this is a great gateway to realizing that you have some blind spots in your business. When you see that your website is leaking lots of money. Which is something we can help you out with. There's a lot of other leaks you can't see, and this might crack your mind open, get you to be open minded like Michael and allow us to be able to help you and support you and make a lot more money, have a lot more freedom and make a bigger difference out there in the marketplace. [00:32:34] We appreciate you listening to our show. If you could do us a favor and leave us a good testimonial on, if you're hearing us on iTunes or like, or comment all of these things help us out and help us get the message out to enact our vision and our mission for this industry of helping it level up. [00:32:50] And until next time to our mutual growth, everybody, bye everyone.  [00:32:54] You just listened to the #DoorGrowShow. We are building a community of the savviest property management entrepreneurs on the planet in the DoorGrowClub. Join your fellow DoorGrow Hackers at doorgrowclub.com. Listen, everyone is doing the same stuff. SEO, PPC, pay-per-lead content, social direct mail, and they still struggle to grow!  [00:33:21] At DoorGrow, we solve your biggest challenge: getting deals and growing your business. Find out more at doorgrow.com. Find any show notes or links from today's episode on our blog doorgrow.com, and to get notified of future events and news subscribe to our newsletter at doorgrow.com/subscribe. Until next time, take what you learn and start DoorGrow Hacking your business and your life.

Geyer & Niesmann - der Politik-Podcast
Amigos, Maut & Masken: Filzstaat Bayern (mit Michael Well, Katharina Hamberger und Christian Deutschländer)

Geyer & Niesmann - der Politik-Podcast

Play Episode Listen Later Oct 6, 2023 71:05


Vor der Schicksalswahl in Bayern geht es in dieser Spezialfolge nicht nur um Markus Söder und Hubsi Aiwanger - sondern vor allem um die krassesten, teuersten und aufsehenerregendsten Skandale, die der Freistaat je gesehen hat: Gemeinsam mit Katharina Hamberger (Deutschlandradio), Christian Deutschländer (Münchner Merkur) und Michael Well (Biermösl Blosn, Well-Brüder) sprechen die RND-Korrespondenten Steven Geyer und Andreas Niesmann über Maskenaffäre, Amigo-Skandal, Ausländer-Maut und all die Bayern-Aufreger zwischen Korruption, Vetternwirtschaft und Fehlverhalten - mit und ohne Gefängnisstrafe. Und nicht zuletzt über die große Frage: Wieso hängt da immer die CSU mit drinnen - und warum verzeihen die bayerischen Wähler ihr am Ende doch immer wieder? +++ „True Crime Politik“ - mit Geyer & Niesmann: Neue Folgen jeden Freitag. +++

Rational Wellness Podcast
The Science and Energetics of Water with Michael Hobson & Karen Weitz: Rational Wellness Podcast 326

Rational Wellness Podcast

Play Episode Listen Later Sep 21, 2023 61:11


Michael Hobson and Karen Weitz discusses The Science and Energetics of Water with Dr. Ben Weitz. [If you enjoy this podcast, please give us a rating and review on Apple Podcasts, so more people will find The Rational Wellness Podcast. Also check out the video version on my WeitzChiro YouTube page.]    Podcast Highlights 6:16  Primary water.  This Aquene Springs water is a primary water.  It does not come from rain that forms underground aquifers and accumulates in lakes and rivers. Oxygen is actually the most common element in the earth's crust, followed by silica as the second most prevalent element.  Oxygen combines with hydrogen to form water and they form steam because of the heat in the earth's crust and it comes to the surface and roars out of the ground at 140 degrees Fahrenheit. So that's an example of primary water that is made in the Earth's crust on a continuous and ongoing basis. 12:14  Silica.  The Aquene Springs water is high in silica dioxide, which is a silicon atom with two oxygens, which is the most common form of silicon found in nature.  And silica, which is a trace mineral, has lots of benefits for our health.  Silica is the basis for bones, hair, teeth, skin, it helps with blood flow, is beneficial for cardiac health, and is also helpful for gut issues.  It also binds with aluminum, a heavy metal, and pulls this out of the body.  As we age we tend to lose water and aging is a process of dehydration and losing silica also contributes to a loss of health.  Michael also recommends a plant based diet partially because this will also result in getting more silica in your diet.    20:05  Hydration.  There are a few ways to improve out hydration. One is to drink water. Another is to eat foods that contain water, like fruits and vegetables. Taking a shower or a bath also helps to hydrate you, since we absorb water through your skin. An additional way that we get hydrated is through the electron transport chain.   Michael:               Well, there's that. Okay, I'm with you on that. Chlorine's, not necessarily a good thing for our bodies, for skin, but there's a third way that Ben, I think will appeal to you from the scientific standpoint. And that is the well-known process of the electron transfer chain, which was discovered by Albert St. Georgi, won Nobel Prize in 1937 as a result of some of this work.  So it turns out that particularly at night, but even during the day in the human body, we take carbohydrates or fats, which store what? Hydrogen. But hydrogen in a very interesting form, not in H2 like it is when it's bound to oxygen for water, it's atonic hydrogen, it's H. If you look at those molecules, it's H bound up with other molecules. So hydrogen bonds to those in a way that when this electron transfer process happens, hydrogen atoms are released, they find each other, and when hydrogen atoms combine , two Hs find each other and form H2, they release energy in the form of heat. And at the same time they bind to oxygen because what do we have in our body? We have oxygen, which is a crucial element. So what I'm saying to you is that the output of the electron transfer mechanism is heat, to warm our bodies to keep them stable at 98.6 degrees and water. So we actually make primary water in our bodies. Michael Hobson is the founder of Aquene Springs, which is a source of pristine primary water that comes out of the ground at 80 gallons/minute and it is a silica-rich, deuterium depleted water with a low surface tension.  Michael is a mathematician, an econometrics professor and a corporate business consultant.  He had several businesses in the music industry and his interest in frequencies eventually brought him to water.  His website is AqueneSprings.com and using the discount code Rational10 will get you 10% off an order of this special water. Karen Weitz is a Reiki energy master, Akashic Reader, Reiki Master, and Sound Alchemist.

THE WONDER: Science-Based Paganism
Repeat episode: Interview with Michael of the Atheopagan Society Council

THE WONDER: Science-Based Paganism

Play Episode Listen Later Jul 31, 2023 45:35


We aren't able to record a new episode this week, so here is a great interview we did with Michael H. of the Atheopagan Society Council. See you next week! S3E41 TRANSCRIPT:   Mark: Welcome back to the Wonder Science-based Paganism. I'm Mark, one of your hosts. Yucca: and I'm Yucca. Mark: and today we have a really exciting episode. We have an interview with a member of the Atheopagan Society Council, Michael, who is joining us today, and is gonna tell us about his journey and what this community means to him and his vision for the future and all kinds of cool stuff. So welcome. Michael: Well, thank you very much for having me. Mark: I'm delighted to have you here, Yucca: Thanks for coming on. Michael: Yeah, no, I'm excited. Yucca: Yeah. So why don't we start with so who are you? Right? What's, what's your journey been to get here? Michael: Gosh. Well, I kind of have to start at the very beginning. So my name's Michael and you know, I've, I start, sometimes I go by Mícheál, which is my Irish, the Irish version of my name. And that's something I've been using more as I've been involved in the Pagan community. My parents are both Irish and. They moved to the United States in their early eighties cuz my dad got a green card working over there Mark: Hmm. Michael: and I was born in America. And then they decided they want to move back to Ireland then in 1991. So already I had this kind of dissected identity. Was I American or was I Irish? I never really lost my American accent. When I, when I moved to Ireland my sister who was born in Ireland, she actually has a slight American accent just from living with me. So she never people always ask her, are you, are you American? And she's like, I've never lived there. So it's funny that it's kind of stuck with her, but I moved to Ireland and I suddenly was kind of got this culture shock at the age of five and moving to this new country. And my mother has a very large family, so she has like, two, two brothers and seven sisters, and then I've got like 30 cousins. So , it was a big, a big change from AmeriCorps. It was just the three of us. Moving back to Ireland and. It was a very, you know, Ireland, you know, is, would've been considered a very Catholic country, and it's been kind of secularizing since the nineties up until now. But back then it was still quite Catholic. Like homosexuality was only decriminalized in 1992 and divorce was only made legal in 1995. So, I guess the first kind of sense of, of what I meant to be Irish back then was, You know, you learned Irish in school, you learned to speak Irish in school, and this was very it wasn't taught very well, I would say, and I think most Irish people would agree with that. It's kind of taught like almost like Latin or something as a dead language rather than as a living language. So you're spending time learning all this grammar. And you don't kind of develop that love of it that I think you should. I did go to like Irish summer camp in the Gaeltacht . The Gaeltacht  is the Irish speaking area of Ireland, and I kind of became aware of my Irishness, you know, just through being part of all this and also. I would've introduced myself as American when I was little but people didn't really like that. It was kind of a, like a weird thing to do. So my mom eventually told me, maybe you should just stop paying that. And so throughout my I, you know, as I mentioned, it was a very Catholic country. And when I was in the Gaeltacht in Irish summer camp one of the kids said they were atheist. And I was like, what does that mean? I'm like, I don't believe in God. And I was, and in my head I was like, I didn't know you could do that, I didn't know that was an option. . So I kind of thought about it for a while. I became, we started studying the Reformation in school when I was about 14. And then I learned that Catholics believed in transubstantiation and nobody had really mentioned that before. They didn't really teach the catechism very well, I guess. I'd done my communion and my confirmation, but nobody ever mentioned that. We literally believed that the, the body and blood, you know, was that the bread and water? Oh, sorry. The bread and wine actually became literally, And the body. And I thought that was a very strange thing, that that was a literal thing. It wasn't just symbolic. And then we also studied Calvinism and all that stuff. And I was like, then I started to read the Bible and I was like, then it fun, it finally just dawned on me that I didn't believe any of this, and it was kind of liberating. But it was kind of a way of being d. In a very homogenous society too. You could be a bit of a rebel. So I think I was one of those annoying teenagers who was always questioning everybody and having, trying to have debates with everybody about religion and they didn't enjoy that . And so I went through school and I just remember hating studying the Irish language until eventually when I left school. On the last day, I actually took all my. My Irish textbooks and burnt them and I feel I . Yeah. I mean I feel so much guilt and regret about that and I think about that how important it's to me now and that, that was a real shame that, but I didn't, partially I didn't put the work in, but also I just think the structure. Was not there. I mean so many Irish people come out of outta school not really know, knowing how to speak the language, you know, and I think it is an effective col colonization as well, where, you know, you consider English is a useful language and learning French or Spanish, that's a useful thing, but there's no use for Irish in people's minds, which is a, and I find that a real shame and I. could go back and change that. In university I studied anthropology and history because I was very interested in religion. All throughout my teenage years, I was obsessed with learning about world religions, you know, there was a world religion class in, in secondary school. I didn't get into it, but I begged the teacher to allow me to. Into it because I was so interested in the topic. And he was like, fine, fine. And he kind of thought he'd humor me in one class one day and he was like, well, Michael, maybe you could talk about satanism. That's the topic for today. And I was like, well, let's start with Al Crowley. And he was like, okay, maybe he actually knows what he is talking about So, I went, I. I went to the university sorry, national University of Ireland, Minuth Campus. And it's funny because that used to be known as so it's actually, it's two campuses. They're St. Patrick's college, which is like a, a seminary for priests. And there's the I, which is like the secular version, and they're both, but they both share the same compass. So it's funny, it used to be the, the biggest seminary in Europe. They call it the priest factory cuz they pumped out so many priests that sent, sent them all over the world. And it's when you go out and you walk down the corridors, you see all the graduating classes. So you go back to 1950 and you see a graduating class of like a hundred priests. And every year as you're going down the corridor, it gets smaller and smaller and smaller. Until I think the year I graduated, there was like two people graduating as priests. Yeah. So that was, that was a, I decided to study history and anthropology at n Y Minuth and one of the books that I read. Was kind of a gateway into thinking about land and language, which are two things that are really important to me in my, when I think about Paganism. It's a book called wisdom Sits in Places by Keith Bato, bass by Keith Bassell, and. I'm just gonna read a little bit here from the book because he was an anthropologist working with the Apache, the Western Apache, to try and remap the land using the Native Apache words rather than the, the English words. So trying to make a native map and working with Apache people to find all the true, the true names of all these. so this is the quote, but already on only our second day in the country together a problem had problem had come up for the third time in as many tries. I have mispronounced the Apache name of the boggy swale before us. And Charles, who is weary of repeating it, has a guarded look in his eyes after watching the name for a fourth. I acknowledged defeat and attempted to apologize for my flawed linguistic performance. I'm sorry, Charles. I can't get it. I'll work on it later. It's in the machine. It doesn't matter. It matters. Charles says softly to me in English, and then turning to speak to Morley. He addresses him in Western Apache, is what he said. What he's doing isn't right. It's not good. He seems to be in a. Why is he in a hurry? It's disrespectful. Our ancestors made this name. They made it just as it is. They made it for a reason. They spoke it first a long time ago. He's repeating the speech of our ancestors. He doesn't know that. Tell him he's repeating the speech of our ancestors. And I'm gonna just there's another section here, a little, a few pages. But then unexpectedly in one of those courteous turnabouts that Apache people employ to assuage embarrassment in salvage damaged feelings, Charles himself comes to the rescue with a quick corroborative grin. He announces he is missing several teeth and that my problem with the place name may be attributable to his lack of dental equipment. Sometimes he says he is hard to underst. His nephew, Jason, recently told him that, and he knows he tends to speak softly. Maybe the combination of too few teeth and two little volume accounts for my failing. Short morally, on the other hand, is not so encumbered though shy. Two, a tooth or two. He retains the good ones for talking and because he's not afraid to speak up, except as everyone knows in the presence of gar women no one has trouble hearing what he. Maybe if Morley repeated the place name again slowly and with ample force, I would get it right. It's worth a try, cousin. And then he, I'm just gonna skip forward a bit and he successfully pronounces the name, which translates as water Lies with mud in an open container. Relieved and pleased. I pronounce the name slowly. Then I, then a bit more rapidly and again, as it might be spoken. In normal conversation, Charles listens and nods his head in. . Yes. He says in Apache, that is how our ancestors made it a long time ago, just as it is to name this place. Mm-hmm. So this became important to me when thinking about the Irish language because something similar happened in Ireland in the you know, we have all our native Irish place. But in the 1820s the British Army's Ordinance survey came and decided they were gonna make these names pro pronounceable to English ears. And so they kind of tore up the native pronunciation and kind of push an English pronunciation on top. So you have these very strange English Anglo size versions of Irish Place names Yucca: Mm-hmm. Michael: Soin in is is probably better known in English as dingle, but doesn't really have anything to do with the Irish. And there are plenty of, there are so many examples of this and I think when you're trying to learn about a landscape in your relation to a ship, to a landscape, it is important to know the native place. It's something that I think about a lot and I try to learn. One of my favorite writers is named Tim Robinson, and he's well he died in 2020. But I had the opportunity to meet him in 2009 and he was an English cartographer. But he moved to the west of Ireland, to the Iron Islands and also to Kamara. So he kind of moved between those two places. He lived there for more than 30 years, and what he actually did was he went out and mapped the landscape and talked to local people, and he was able to find some of the place names that had been lost over the years that weren't on the official maps, and he was able to help recreate a Gaelic map of those areas. I think that's a really kind of religious or spiritual activity to go out onto the land and walk it. And to name it and to name it correctly. And I think that's what I think my pagan path is in a way. It's to go and walk the land and learn it, what to call it. Cause I think language is the most important tool we have as pagans. Mark: Hmm. Michael: So those are, that's kind of when I started to think about this stuff. I've always been interested in folk. It was actually funny. There was, it started with a video game one of the legend of Zelda video games called Major's Mask Mark: Hmm. Yucca: Yep. Michael: in, in the game, they actually have like a mask festival and they dis they discuss the the history of the festival. Anna was just like, wow, I didn't, I ended up making masks with my sister and we kind of pretended to. A little mask festival of our own Yucca: Mm-hmm. Michael: that you're, you're familiar with that? Yucca? Yucca: Yes. Yeah, I played a lot of it. Michael: Yeah. So, but I guess I really started to think about folklore when when I watched the Wickerman as um, as a teenager. I was probably at 16 when I watched it, and it kind of opened my eyes completely. And we've talked a lot about this in the group. And I. It's watched as a horror movie in a way, but I think I really got into the, the paganism idea of, of paganism as a teenager because of watching the Wickman and just the symbolism and the pageantry. And I also just like the idea. These island people turning on the state in the form of, of the policeman. So that's kind of been something I've that I've really enjoyed over the years, watching that every every May as part of my, my, my annual ritual so, you know, after university, I, I moved to South Korea to teach English, and, but at the same time I was quite into Buddhism. I had been practicing some Zen Buddhism from about the age of 18, and, but not like, more as just a practice rather than believing in any of it. Not believing in reincarnation or anything like that. I just found the ritual of it very beautiful. And I ended up going and doing a temple stay in a, in a place at, at a temple. Up in the mountains and it was very beautiful and really amazing. You know, something you'd see in a movie because the monk, the head monk actually brought us out into a bamboo grove and we sat there meditating just with all surrounded by bamboo. And it was waving in the wind and it felt like a correction, tiger Hidden dragon or something like that. And one of the powerful events that happened on that trip. Doing the Buddhist meal ceremony where we ate in in the style of a Buddhist monk. And the idea is that you do not leave any food behind. After you're, after you're finished eating, you've, you eat all the food, and then when you wash the bowls and they kind of put the communal water back into the, the, the waste bowl, there should be no no bit of food, nothing. It should just be clean water. That comes out of, after everybody finishes washing all their bowls. So we followed all the steps to do that and, you know, some people really, really weren't into it. They didn't wanna do the work of, of being extremely thorough. And there were a few rice pieces of rice in the water at the end and the head monk said to us oh, that will now get, you're, you're gonna cause pain to the hungry to ghost. Because the hungry goats ghosts have holes in their throats, and when we pour the water outside for the hungry ghosts, the rice particles are gonna get stuck in their throats. And a lot of people were like, what? What are you talking about Mark: Hmm. Michael: But I thought that was beautiful because it doesn't, not, you don't have to. It's a story that has a purpose, and that's why, you know, It made me think about the superstitions that we have. And I don't know if I like superstition like these, calling it that. Cause I think a lot of these things have purpose and you have to look for the purpose behind them. And the purpose of that story of the honky go story, maybe for him it is about not causing harm to these, these spirits, but it's also about not wasting food. And I think it, it has more power and more meaning. And you remember. More thoroughly when you have a story like that to back up this, this practice. So I think it kind of made me rethink a lot about the kind of folkloric things that I, in my, in the Irish tradition and that, you know, I think about things like fairy forts, which are, you know, the, these are the archeological sites that you find around Ireland. Like, I think there's like 60,000 left around the country. These, these circular. Homesteads that made a stone or, or saw, or saw that you find all over the country and people don't disturb them because they're afraid they'll get fair, bad luck. The, if you, if you disturb the, the fair fort the ferry's gonna come after you , or if you could, or if you cut down a tree, a lone tree. Lone trees that grow in the middle of fields that don't have a, a woodland beside them, just singular trees. These are known as fairy trees and it's bad luck to cut them down. But I feel like these folk beliefs help preserve the past as well, because, you know, farmers who don't have this belief, they don't have any problem tearing down fray, forts and that kind of thing. They just see it as a, something in the way of them farming, especially in the kind of age of industrial agriculture. Yeah. So it just made, that was when I started to think about how important it is to keep folk belief alive. And I've really, and I really started to study Irish folk belief after that point. And I lived in South Korea as I mentioned. I met my wife there, she's from Iowa and she was also teaching in, in South Korea, and we moved to Vietnam after that. And we lived there for a couple of years, and I might come back to that later. But fast forwarding, we moved to Iowa then in 2013, and I'm teaching a course in Irish. At a local community college, but I always start with this poem by Shama Heini Boland. And I just wanted to read two extracts from it. So the first stands out is we have no prairies to slice a big sun at evening everywhere. The eye concedes to encroaching. And then moving downwards. Our pioneers keep striking inwards and downwards. Every layer they strip, they, every layer they strip seems camped on before. So I, I started with that initially, kind of trying to, as, it was almost like a gateway for my students to kind of look at. Look at Iowa with its historic prairies, which don't really exist anymore. It's all farmland. There's very little prairie land left. I think maybe 2% of the state is prairie. But that idea, that idea of our pioneers strike downwards, and I've been thinking about that a lot as well, that that's kind of a, a colonial look at the land because this land, the American land has is just as camped. As Ireland, and I've been kind of experiencing that more and more. I have a friend who's an archeologist here and just hearing them talk about the kinds of fines that they have. You know, we lived in a town where there was a Native American fishing weir was a couple of hundred years old. It you could kind of see the remains, but it mostly washed away by the time we had. But I did see an old postcard of it from the seventies, and you could see it very clearly. And so just make, and then we always it's become a ritual every every autumn, we go up to northeast Iowa to these, to these effigy mounds, which are some Native American mounds up there on a bluff, just overlooking the miss. Mark: Hmm. Michael: And that's really amazing to look at that and experience and experience that. And you know, I'd love to go back, unfortunately, Shamus, he died more than 10 years ago now, but I'd love to go back and ask him if he would consider rewriting that line, you know, because this land is just as a count on Yucca: Mm-hmm. Michael: and I'm trying to, trying to make sense of that and what it means. As an Irish person living in America, Yucca: Mm. Michael: Cuz we, Irish people are victims of col colonialism, Mark: Hmm. Michael: Irish people, when they moved to America, they just became white as well and had the same colonial attitudes as everybody. And I'm trying to kind of, but you know, there's, there's, there's kind of stories of reciprocation as well. Where during the famine, the Irish famine the, I think, I believe it was the Chota Nation sent Emin relief to the AR to Ireland. Even though they didn't have much themselves, they still saw this. People in need across the water and they sent money to help. And, you know, there's that connection between the Chta nation and the Irish has continued to this day. But I am just trying to figure out what it means to be an Irish person and a pagan living in this country. And that's kind of where I, where I am right now. But to get back to how I got into Ethiopia, paganism I mentioned earlier that I was really into the Wickerman and I found this group called Folk folk Horror Revival on Facebook. And somebody one day mentioned that there was this group called Atheopagan. And so I decided to join and I found a lot of like-minded people. And I've been kind of involved in the community for, for, I think that was maybe 2018. Mark: Mm-hmm. Michael: And I've been involved in the community since then and maybe on a bigger, I've been much more involved since Covid started and we started doing our Saturday mixers. And I think I've made maybe 90% of those Mark: something Michael: and we've, yeah, and we've been doing that for the last three years and it's just been. It's a really amazing, it's one of the highlights of my week to spend time with with other people in that, in that hour and 45 minutes that we spend every Saturday. Mark: Mm. Michael: Mm-hmm. Mark: Yeah, I, I really agree with you. That's, I, it's a highlight of my week as well. Such warm, thoughtful people and so diverse and living in so many different places. It's yeah, it's just a really good thing to do on a Saturday morning for me. And. We'll probably get into this more a little bit later, but the idea of creating human connection and community building I know is really important to you and it's really important to me too. I think there have been other sort of naturalistic, pagan traditions that have been created by people, but they just kind of plunked them on the internet and let them sit. And to me it's. That would be fine if I were just gonna do this by myself. But when other people started saying, I like this, I want to do this too. To me that meant, well then we should all do it together. Right? Let's, let's build a community and support one another in doing this. And so the Saturday mixers, when we, when Covid started, I think. I mean, to be honest, COVID did some great things for the Ethiopia, pagan community. Yucca: Yeah. Mark: yeah. Kind of accidentally, but that's, that's Yucca: Well that's the silver linings, right? That's one of the things we, you know, life goes on. We have to find the, the, the benefits and the good things, even in the challenging times. Mark: Mm-hmm. Mm-hmm. Michael: yeah. I think. I'm just thinking back to when we started. So it's kind of, we have maybe six or seven regulars who come to every meeting maybe. And then we have other people who join now and then, but I'm just trying to think back to the first meeting. I think we, that's when the idea of doing virtual ritual began as well in that first meeting. And we were trying to figure out how to do. Yucca: Was that was the first meeting before Covid or was it as a response to Covid? Mark: You know, honestly, I don't remember. I think it must have been in response to Covid because everybody was shut in and, you know, everybody was kind of starving for human contact. Michael: I think the first one may have been March or April. 2020, Yucca: Okay, so right there at the. Michael: Yeah, right at the beginning. Yeah. And I think, I remember in the first meeting we were talking about ritual ideas and I think the first suggestion I came up with was like I'd love to somebody do like a, describe what an atheopagan temple might look. Mark: Oh yeah. Michael: Yeah. And I left, and I think you were recording the meetings at that time, but we don't record 'em anymore, just so people can feel free to be themselves and not have a recorded recording of themselves out there, . But I know that, I think James who you interviewed recently he, he was listening to that one, I believe, and he came the next week and actually had prepared a guided meditation. Of what a pagan temple would be like to him. And it was a walk through nature. I think that was the first, our first online ritual together. Mark: Yeah, I remember that now. Yeah, and it's been, it's really been a journey trying to figure out how, how can you do these ritual things over a, a video conferencing platform. In a way that makes everybody feel like they're participating and engaged. Right. So that there's a, a transformation of consciousness. But I think we've done pretty well, to be honest. I mean, some of the rituals that we've done have been really quite moving. Michael: Yeah. And I think the ritual framework that you've worked at translates very well to. A Zoom conference as well. I dunno if maybe, if he wants to describe that, what the usual atheopagan ritual would look like. Mark: Sure. We've, we've talked about this before. The, the, the ritual structure that I proposed in my book is basically a, a five step process where the first is arrival, which is sort of, Transitioning into the ritual state of mind from the ordinary state of mind, and then the invocation of qualities that are a part that we'd like to be a part of the ritual with us, which is sort of the equivalent in Wicca or other pagan traditions of invoking spirits or gods or what have you, ancestors, what have you. And then the main working of the ritual, which varies depending on what the purpose of the ritual is. But it can be, well, we've done lots of different kinds of things. We've braided ribbons and then tied, not tied magical knots in them. We've made siles, we've we've done just lots of different kinds of things. And then gratitude expressions of gratitude. The things that we're grateful for. And then finally, benediction, which is sort of the closing of the ritual at a declaration that we're moving back into ordinary time. Yucca: So how does that look in, in a meeting, like a Zoom meeting In a digital format? Mark: Michael, you want to take that one or should I? Michael: So you know, you have maybe, I think usually when we have a ritual more people attend that and so we might have 12 people there and often Yucca: cameras on. Michael: Camera's on. Well, it's optional. Yeah. If you don't feel comfortable having your camera on, that's completely fine and you don't even have to speak. We do encourage people just to you know, leave a message in the chat so you can just listen in. You can engage as much or as little as you want. And you, you, so. We have all the people on in the conference, and maybe we'll try and get some more of the senses involved as well. So sometimes we'll like candles and everybody will have a candle in front of them. I do know for for some of our sound rituals. Mark, you've used two cameras where you, you aim one camera at maybe a focus, like what's one of the examples of that that you. Mark: Well we did that both at Sown and at Yu. So both the Halls ritual and the Yule ritual where I would create a focus or alter setup with thematic and symbolic things relating to the season. and then I would point, I would log into Zoom with my phone and point my phone at that. And then, and then I'd log in separately on my laptop for myself as a person, and then I could spotlight the focus so that it's kind of the centerpiece of what everybody experiences on their screen and sets the atmosphere. Michael: Yeah. So just a virtual focus that everybody can, everybody can virtually gather around. Yucca: Mm-hmm. Michael: Yeah. And I think we've also used a Pinterest board in the past as well for people. I think it was at Sound again, we had that Pinterest board where people could put up notes about. Their ancestors or loved ones that they were That's correct, isn't it? Mark: Yeah. Yeah. Or pictures of people that had passed recently or. Yucca: mm. Michael: yeah. So yeah, there's a lot of digital space that you can use for this ritual. We also try not to involve too many props as well. Because we wanna make it as easy as possible for people of all abilities. And just if you don't have the space for something, for a large proper if you don't wanna make a lot of noise, you know, we're not gonna have you using chimes or things like that. So we try and make it as easy as possible. Sometimes we do invite you to bring some food to eat as well, because, you know, a lot of these are feasting rituals. So we maybe, if you feel comfortable bringing some refreshments, you might want to do. And just have a friendly meal with people online. For example, we're actually gonna start doing I'm gonna be leading full Moon meals every month on the, on the, so the first one's gonna be December 7th. And I'll post, post about that on Discord, and I think Mark will post about that in the Facebook group. Yeah. And so the idea is everybody just comes. Joins the Zoom meeting and everybody should have their meal. Whether you're, whether that's lunch or if you're in a different time zone, maybe there'll be dinner or maybe it's just a snack. And then we'll spend a minute just thinking about the providence of the food and then we'll eat us and maybe people can talk about the food that they're eating and what it means to. And I'm hoping to make that a monthly event that we meet every full moon to share a meal together Mark: That sounds. I, I, I really I have pagan guilt over how little I pay attention to the full moon. I'm, I'm always, I'm always aware of what phase the moon is in, but I, I don't do a lot in the way of observances of the phases of the moon. And so, I'm excited to have this added in to something that I can attend. Michael: Mm-hmm. . But yeah, as you can see from that format, it's very simple. And again, you, if, if people listening would like to attend as well, there's no obligation to keep your. Your camera on, there's no obligation to speak. You just, you can just listen in and just feel part of the, part of the community that way. Yucca: Mm-hmm. So in the mixers sometimes ritual, are there discussions or what else do the mixers. Michael: Usually the mixer is kind of a freeform thing. Yucca: Mm-hmm. Michael: Maybe we'll have a topic sometimes, but usually people just come and do a check in and talk about how they're, how they're getting on that week and if there's anything they wanna discuss, we just open it up to that. Depending on the size of the turn, we may require some kind of etiquette stuff. So if there are a lot of people and we don't want people to. Shut it down or have spoken over. So we'll ask people to raise their hands if they wanna speak. That's, that really is only when there's a lot of people and, and often I, I know I'm somebody who likes to talk, so it's a, I think raising hands also gives people who are less confident, or, I'm sorry, not less confident, just not at, don't feel like interrupting. It gives them an opportu. To to have their say as well and be called on mm-hmm. Mark: Yeah. Yucca: Mm. Mark: I think it's really good that we've implemented that. It, it's, it helps. Michael: Mm-hmm. I think one of the really cool rituals we had recently was for like the ATO Harvest, so that was when was that? That was in September or October. In September, yeah. Yeah. So. We were trying, I mean, usually it's, you could do some kind of harvest related and I think we've done that in the past. But I have a book called Celebrating Irish Festivals by Ruth Marshall. And this is my go-to book for, for, for ritual ideas. And this is, and I like to. Kind of some of the traditional holidays and maybe just steal from them. . So Michael Mass is is the holiday around that time in Ireland? It's a Christian holiday, but it's also it's a Yucca: were older. Michael: yeah, yeah, Yucca: Christians took for the older Michael: yeah, yeah, yeah. you know, it's about St. And he's known for slaying a dragon as just as St. George was known for slaying a dragon. But I thought, well, let's turn this on this head and let's celebrate our inner dragons. Let's bring our dragons to life. So it was the whole ritual was about dragons. And we actually drew Dragons, drew our inner dragons and shared them. Talked about what they. And kind of we were feeding our inner dragon so that they could warm us throughout the coming winter. Yucca: Hmm. Michael: Mm-hmm. Mark: as well as watching the home. Star Runner Strong Door, the Ator video, Michael: Oh yeah, Mark: which you, you have to do if you've got dragons as a theme. It's just too funny to avoid. Michael: That's an old flash cartoon from the early two thousands. That was pretty popular. Mark: Mm-hmm. Michael: Yeah. Track toward the ator. Google it, and in fact, I did a, I did the hot chip challenge as part of that ritual as Mark: That's right. Yeah. Michael: where I ate a very, very hot tortilla chip on camera. And. It was it was painful, but I'm sure, I don't know if it entertained other people, but it was, it was fun Mark: Oh yeah. It was fun. Michael: So, yeah, they're like, I mean, these rituals aren't all, they're, they're fun and they're kind of silly and goofy and but I mean, I thought at the same time they're very meaningful because people really opened up in that one Mark: Yeah. Michael: and shared some really profe profound truth. That was one of my favorites actually, and I hope we do another, another dragon invoking ritual in the future. Mark: Maybe in the spring Michael: yeah. Mark: you do it at, at both of the equinoxes. Michael: Mm-hmm. Mark: so you've joined the Atheopagan Society Council, which is great. Thank you so much for your, your volunteering and your effort. What do you think about the future? How do you, how do you see where this community is going and what would you like to see? What's, what's your perspective on that? Michael: Yeah, so just before I discovered the Pagan Facebook group I had attended A local cups meeting. So that's the covenant of Unitarian Universalist Pagans. And so it was just a taro reading workshop and, you know, I was, I, I like kind of using these kind of rituals just for their beauty and, but not, for not, not seeing anything supernatural in them. I was, it was amazing to, to find a group that was interested in these kind of things too, but without the they weren't incredulous. So I guess what I'm hoping for is that as we, as we kind of find more people who are, are, are aligned with us, maybe we can have more in. Experiences. That was one of the great, the great highlights of, of last year was attending the Century retreat and meeting all, all these amazing people in real life and being able to spend time together in real life. And I hope that as we kind of, as the word gets out about this group, more and more of us can meet in person or as we are able to, Mark: Mm-hmm. Michael: That's what I really hope for the future that you're finding your, your people that we are, we are being able to get these local groups together and then spend time on these important days of the year. And I believe the Chicago Afu Pagan group was able to do that not too long ago. And I know Mark, your local group meets quite regularly as well. Mark: We, we meet for the, for the eight holidays, for the eight Sabbath. So yeah, we're gonna get together on the 18th of December and burn a fire in the fire pit and do a, a ritual and enjoy food and drink with one another. And yeah, it's a, it's a really good feeling that that feeling of getting together is just You can't replace it with online connection, but online connection is still really good. So that's why, that's why we continue to do the mixers every Saturday. And Glen Gordon has also been organizing a mixer on Thursday evenings. Well evenings if you're in the Americas. And. Yeah, there's just, there's, there's a bunch of different opportunities to plug in and it's always great to see somebody new. Michael: Yeah, I think that would be another hope as well that, you know, if you've been on the fence about coming to a mixer I hope that what we've described today maybe entices you to come along. You know that there's no expectations and you can, you can share, you can just sit in the background and watch, or you can participate. There's no expectations and it's just a nice way to, to connect with people, so, Yucca: how would somebody join in? They find the, the link on the Facebook discord. Michael: that's right. Yeah. So I think, mark, you post it regularly on the Facebook group, and it's also posted on the disc. As well. So, and it's the same time every Saturday, so it's 12:15 PM Central for me, so, and that's like 1115 for you, mark, on the, Mark: No, it's 1115 for Yucca. Michael: Oh, okay. Mark: It's 10 15 for me. Michael: Okay. Okay. Yucca: one 15 for Eastern. Then Michael: one, yeah, that's right. Yeah. Yucca: Hmm Mark: And. Michael: and it's always the same time, and I think we've, I think we've only missed one week, maybe in the last three years. Mark: Yeah, I think that's right. I wasn't available and I couldn't find somebody else to host or something like that, but yeah, it's been very consistent. And I see no reason to think it isn't gonna keep being consistent. But yeah, we, you know, we welcome new people. And if you're not in the Americas, that's fine too. We've got a couple of Dutch people that come in all the time. There's a, an Austrian woman who lives in Helsinki who participates. So Yucca: E eight nine ish kind of for Europe, Mark: Yeah. Michael: Yeah, yeah. Yeah. We've even had on the Thursday night mixer, we've even had Australians join occasionally too. So Yucca: That sounds like that'd be early for them then, right? Michael: yeah, Yucca: getting up in the. Michael: Mm-hmm. . Yeah. But I'd I'd love for some of the listeners to come and join us on one of the mixers and then cuz you know, you bring new ideas. And I we're always looking for new ritual ideas, Mark: Mm. Michael: That kind of bring meaning to our lives and to everybody else's. Mark: Mm-hmm. Yeah, cuz that's, I mean, that's what we're doing, right? We're, we're create, we're, it's a creative process for us. We've got these sort of frameworks like the Wheel of the Year and the, the ritual format that I laid out. Although people can use other ritual formats too. That's fine. But it's, it's an ongoing process of creation and of taking some old traditions and folding them in where they fit but creating new stuff as well. One of the innovations that we, that we've been doing for the l past year or so is if people want to be done with something, if they want to be finished with something in their. They can write it in the chat and then I take the chat file and I print it on my printer and I take it and I burn it in my cauldron. So it is actually being burnt physically. But it just takes a little bit of technical processing before that happens. Yucca: Hmm. Mark: And it's those kinds of innovations that are really useful for online rituals. And boy, if you have new ideas about things we can do for online rituals, I, I would love to hear 'em. Yucca: So thank you so much for sharing your story and your visions or the future with us. This has been, it's, it's really been beautiful to hear and to get that insight. Thank you, Michael. Michael: Well, thank you for having me on. Yucca: Yeah. Mark: It's been delightful hearing from you and, and I, I gotta say, I, I feel like our community is very lucky. You've been exploring religion and and folklore and ritual for a long time in a lot of different frameworks and I feel really fortunate that you've landed with us cuz I like you so. Michael: Okay. Well thanks very much. I like you too, Mark: Okay folks, that'll be all for this week. And as always, we'll have another episode for you next week on the Wonder Science Based Paganism. Have a great week. Yucca: Thanks everybody.

Super Serious 616
E207: Superheroes are the new machine guns (Journey Into Mystery #116) -- June 1965

Super Serious 616

Play Episode Listen Later Jun 30, 2023 10:49


In this episode:Mike and Ed continue their discussions on what the original Avengers are doing in their post-Avengers lives. For instance, Thor now seems to be working for the American military in Vietnam. Was he drafted? Or did he consider deserting to move back to Asgard? Will super-powered individuals become the next weapon of war? Will heroes sell their services to the highest bidding country? Is there a way to stop the escalation, or is this just the new way of the world?Behind the issue:Stan had Thor appear in Vietnam, but never had him coordinating with the US military. Comic books in the 1940s were practically US-propaganda, and the heroes were expected to be fighting against Hitler. But in the 1960s, the writers mostly kept the heroes out of real-world conflicts. It wasn't until the modern era that writers considered the possibility of heroes fighting in Vietnam.In this issue:Thor is spotted in Vietnam and shot by a hunter. The hunter then comes across an ancient temple and, through the machinations of Loki, the hunger takes over the Destroyer armour with his mind. The hunter pilots the Destroyer in a fight with Thor. Meanwhile on Asgard, Loki is imprisoned.This episode takes place:While people are still adjusting to “Cap's Kooky Quartet” - and missing their “old” Avengers.Assumed before the next episode:People are wondering what Thor was doing in Southeast Asia.Full transcript:Edward: All right, Mike. Continuing our, where are they now? Series. We now know where Thor has been for the last couple of months.Michael: Yeah. He's decided to take his retirement to Vietnam.Edward: Vietnam, you'd think with his hair like that, he would've been a conscientious objector, but no Siri, don't stereotype Thor. He is right there with the military. Right in the thick of things.Michael: All kidding aside, it's pretty wild that this man, or this being Thor, who's associated with, the American military and the military industrial complex has gone to Vietnam, clearly on behalf of the Americans, and intervened in international affairs. Clearly as an agent of America, or at least on America's interest. Yeah, for sure. Doesn't that make it a little more complicated over there? Is that what we wanna,Edward: I think it makes it less complicated. ANCO was clear before that the Avengers were an American superhero organization that had American interest at heart. Their leader was Captain America. It's pretty clear that they were into America and hey, they were supported and run by, stark Corp, who are like basically a big American company. They're an American team now, Thor leaves the American team that he leaves the Avengers.What does he do next? He doesn't go back up to Asgard. He goes and works for American interests in a non Avengers way.Michael: It seems a little, isn't it? I don't know. I find it uncomfortable that we would entrust, international diplomacy to, well, it's costume adventures.Edward: Well, it's not diplomacy. He's not negotiating peace treaties. He's swinging his hammer and like on a hitting North Vietcong.Michael: But this. But there's consequences to that though. Like aren't you worried that that's gonna lead to say, other Superpowered beings that might be drafted in by the Vietcong to fight American soldiers overseas in,Edward: do the Viet Cong have a superhero?Michael: Not yet. Well, there you go. Not yet, but there you go. But you don't think the Chinese might have an interest in this. Have a say in it.Edward: That's, that, that is true. We know the Chinese do have their own superheroes. Radioactive man. Radioactive man. So, you're saying it's an escalation of the conflict. And maybe this means China sends in radioactive man, but China is not like US is directly involved in that war. China is only indirectly involved, right? They have plausible deniability. If they send in radioactive man, there goes their plausible deniability.Michael: Well first of all, there hasn't been a military briefing or any kind of official report in that Thor is going there on the direction or in service of the United States. So, I think the United States is trying to do this if they're doing it under some kind of plausible deniability scenario, and China could do the same thing, like we don't control radioactive man.He's just a guy who believes in our values and that's why he is fighting. He's just showing up and fighting. Showing up and fighting, and that's why he is fighting the Americans in Vietnam.Edward: But there's no Chinese soldiers in the vie, they're supplying them with weapons and stuff, but they're not supplying them with people I don't think. Here's the question. That's an ex escalation though. Here's, here's the question. Was Thor just drafted? Maybe he was just part of the draft.Michael: I don't know. Well, he might have been, but thatEdward: his number came up and he off he went.Michael: He, had to go.Edward: He had to go. He had no choice.Michael: He was gonna fly away to Asgard. But No, but I'm still thinking about deescalation,Edward: other deserters run to. Canada, but not Thor. He heads to a whole intervention, flies to another, another realm, a mystical realm. Yeah. But he knew he wanted to come back to America. So he knew that if he abandoned us, we weren't gonna let him back in.Michael: So if I look at it and you look at it, the Vietnamese will probably look at it and the Chinese look at it that America has sent a superpowered individual to fight a battle on their behalf.Clearly that what has happened. So I would think that the natural response would be that the Vietnamese through some kind of connection have one of their own. And then now we have, are we having our superpowered heroes and villains or people fighting each other?Not just fighting each other, but fighting regular powered humans? Well, I think so. It's like if they think if they we're getting to a different era, I guess,Edward: but I think, these people have powers and they're outta capabilities. It's almost like, if we had a really good tank, let's not use it because the other guys might bring in a big tank.We have airplanes, let's not use airplanes cuz the other guys might have airplanes. We have an advantage over the Vietnamese right now because we have superheroes and they don't. Not using them, I think would be irresponsible. Americans would die if not for Thor. Thor is probably saving American lives right as we speak.Michael: Yeah, but Ed, right now, America could use nuclear bombs in Vietnam, but they're not gonna, they're not, not,Edward: we're not gonna use nuclear. But nuclear bombs have all sorts of like side effects that a lightning bolt from Thor, there's no radiation when he fires a lightning bolt and blows up a, nothing like a depot.Michael: Lightning, basically Radiation?Edward: No, it's, no, it's not radiation any more than the light is radiation.Michael: Not basically, but I'm sure there is radiation that comes off of, there's certainly the light part of it and that part of the spectrum.Edward: Yeah, but there's no radiation. It's not radioactive.When you get hit by lightning, you're not gonna cause cancer when you get hit by lightning. Now you may die when you get hit by lightning, but it's not gonna cause future cancers.Michael: But my point is that America could use nuclear weapons, but they don't because they don't, they know that that could lead to an escalation.So isn't sending a superhero in kind of similar thing?Edward: It's more than an escalation response. Yes. Yes. I think it's a big, we should not be using nuclear weapons. We don't want to go down that route. But a superhero is not a nuclear weapon. We use superheroes all the time. We use superheroes all the time for, we use superheroes when stilt man attacks New York City, we're not gonna drop a nuclear weapon on Stilt Man.Michael: No, but the difference is that there's a difference between fighting crime in the city and then going to another nation. To affect foreign policy through, excessive force similar to a nuclear bomb sending, I think a superpower person's gonna do the, achieve the same result.Edward: I feel that the Vietnam War is already at the excessive force stage. We're, we're not like, this is devastating. Let's have a, let's have a very stern conversation with them. Like there's people shooting at each other there there's war happening, there's helicopters and bombs and Tanks and so why shouldn't Thor be involved to, to help put an end to this thingMichael: But this is a devastating next step. I mean the fact that you say it's irresponsible for them not to use Thor means, cuz you know, he's gonna be particularly effective. Much like individuals are bombed. Yeah, I think so. Why don't, so doesn't this lead to other nations around the world saying like, well better get some more superpowered individuals and then it gets into a bidding war. We've already talked about how the Avengers used to be a bunch of strangers who kind of got together very powerful and they've basically disbanded. And now it's like a bunch of former villains, you know, who are now with Captain America, which is pretty bizarre to say that they,Edward: Maybe this makes even more sense now, right? If you have these people like. Quicksilver and the witch and the Hawkeye. And your choice is, hey, bring them onto the Avengers and make them part of our team. Or let them become free agents and join the Soviets. Maybe that makes the most sense that we brought them onto the team.Michael: Maybe, but are we not getting to an era? Mercenaries, the superheros turning to mercenaries. What keeps them loyal to one particular ideology over another? I don't know, like is the American structure better than, the American democracy better than other forms of political philosophies in governments? You talk to every American I've ever spoken with, they'd say, no, it's the best. But other nations have different approaches to, policy, politics, and governments and structures and say, no.Edward: We had this in World War ii, right? We were the most attractive there was a lot of scientists that said, oh, you know what? Let's help the US build the atomic bomb because we want them to have it not the other guys. And those, a lot of those scientists came from Germany, but they said, no. Mm-hmm We wanna work for America. Or they came from Soviet Russia with, no, we wanna work for America because we think that you guys. We are freedom loving and as problematic as the US has been over the years doing many, many things they probably shouldn't have.The alternatives seem to be a lot worse and superhero superheros are lining up behind that. They're realizing that better to work for America than work for the other guysMichael: for now. But what happens if , For instance, let's just pick our neighbor to the north, let's say in Canada. They just decide to say up the ante to get a superpowered individual that could lead to say, battling other nations. So they became more war monering because you know that America's, you know, mightEdward: Canada becomes the, the war Moner. Yes, the war moner. You can call me either their hockey sticks, you can call me captain. Boring. That'sMichael: not boring captain, but they go. But my point is that, is that any nation.If they for the right price could get a superpowered individual who might think, you know, I like their philosophy too and we know that American might has led to American, financial benefits as well, right? I mean they, people don't just think America's great and that's why America does so well financially.No, we're great because they make great movies. Make great movies and actually use their money and their might to influence world markets. And so who's to say that the long plan might be like, say, great Britain might just start building up their SUPERPOWERED individuals so that they can basically go and effect world affairs through the superheroes.That that would then lead to increasing their financial, um, that's, that'sEdward: okay with that. Take America with that. They're not gonna take out Amer London is gay. This is not the American Revolution. America. If Britain, Britain, Britain is our ally, if Britain is more successful, now's good. That's good.Michael: Thor just, Thor just got sent into Vietnam. I'm just saying that we're on the prey, I think of changing how, international affairs are structured and how disputes are resolved if we're getting into sending superheroes to other nations. To fight on a base, on an ideological basis against other nationsEdward: superheroes, adjust the next technology.I feel like Mike, you'd be against using the airplane in World War I. You'd be like, no. If we use the airplane, maybe they'll use the airplane. Oh no. That'd be terrible. That'll be planes flying everywhere. That'll be the end of world order. No, as long as we make more airplanes than they do, we'll be fine.And we're making more superheroes than everybody else in the world combined.Michael: But I think one of the main things that came out, the difference between World War Well, sorry. World War I, what was a game changer was the machine gun, right? The mechanized instruments of slaughter and death and destruction.Edward: Well, now you're just giving the machine gun a bad name.Michael: I. Who would, right. But like, and it, andEdward: it, it think of all the good the machine gun did, could like, butMichael: it affected the world. It definitely affected the world and you might say, well, it's better. I don't know if it is, but it certainly changed it. I'm saying that we're the press p where we might be getting outta control because now wars are, so, the reason why we don't get into a war with the U S S R right now, is because it'll be so destructive. Because we've evolved our technology to the point that we could just destroy the world many times over.Are we not just pivoting towards superheroes where we could destroy the world many times over through them? Frightened dead. I'm frightened.Edward: All right. Well, I think it is what it is though, Mike. I feels, it feels like, just like we couldn't hold back the machine gun in World War I, I don't think we hold back superheroes anymore.I feel like the cat's outta the bag or the Thor is out of the. Helicopter.Michael: The hammers outta the clasp towards bellsEdward: the hammers outta the clasp. It's the new catchy phrase, and you heard it here first.Michael: Kids. Kids these days and their sayings. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.superserious616.com

Super Serious 616
E206: When they tell you what they are, believe them (Amazing Spider-man #26) -- June 1965

Super Serious 616

Play Episode Listen Later Jun 23, 2023 5:58


In This EpisodeMike and Ed discuss how the Goblin and the Crime Master may be the same person. Also the Green Goblin is now clearly a villain. His early work attacking crime families seems to just have been so he can consolidate organized crime under his own leadership. Ed admits his earlier errors and Mike helps Ed understand that Goblins are, historically, not known for their altruism. What does it say about Mr Fantastic?Behind the IssueThis is the first appearance of the Crime Master (he dies in the next issue, and unlike most dead villains is never resurrected - at least as of this writing in 2023). In the issue Stan leads the reader (and Spider-man) to believe that Fredrick Foswell (formerly the Big Man, now “reformed”) is secretly The Crime Master. When it turns out that Foswell was actually on the side of good and the Crime Master's secret identity was someone who had never been mentioned before, Spider-man says something about how “sometimes it's just a random guy”. In the future Stan will write another reverse and Foswell will go back to being a villain, but for now he is one of the heroes of the story. In this issue:The Green Goblin meets up with the Crime-Master to see if he will join forces with him to take over the criminal underworld of New York City. But the Crime-Master declines. A crime cold war begins anew.It turns out that the Crime-Master is actually Frederick Foswell, the allegedly reformed Big Man who has returned after his stint in prison to work as a newspaper reporter again for the Daily Bugle.Anyway, Spider-Man gets caught up in the middle of this crime cold war, and the Goblin captures him. The Goblin takes an unconscious Spider-Man to a crime meeting that the Crime-Master had set up to announce that he was the leader of NYC's criminals - but the Goblin has other plans.This episode takes place:Around the time of a crime cold war in New York City.Full TranscriptEdward: Uh, Mike, the green goblin, I stand corrected. Green Goblin is not a hero. He is not a good guy. He,Michael: shocker Ed. Just a but the shocker,Edward: so Mike, I admit when I'm wrong. I admit that even though he was doing a heroic thing, trying to take down crime families, he was not doing it for a good reason.Michael: He wasn't altruistic.He wasn't just like, you know what? I wanna, you know what I do? My spare time is just take down, and weaken crime families and just let them just see what happens afterwards. It turns out he was trying to take them over.Edward: So, there's a difference whether it's the meaning behind the action that's important or the effect that's important. And if the effect was to eliminate crime, may, maybe he was, maybe he was a good guy even in spite of himself. Uh, okay. It's, it's a stretch.Michael: That's a bit of a stretch, Eddie. Like, I mean, look, what I think is that, the last time we spoke about this, you were saying, Hey, it looks like the green goblin is a hero.And you can't read too much into it, I guess. But if I was. Talking to you. I said, ed, going forward, I want you to refer to me as the ogre. You'd be like, you'd say Mike, like, what's going on with you? I'd say, I don't know. I just want you to, I want you to call me an ogre.You know, believe me then there might be a problem and I might view myself negatively. And so if someone says, I'm the green goblin, you're basically saying, I am scary. I am someone to fear I'm not a hero.Edward: En vain, probably vain or, no. Envious. Envious. Isn't it? Green with envy. Agree with envy, an envious,Michael: there's no goblin, there no goblin in history. You're like, you know, like, I like that guy. I think, you know, I'd like to maybe hire him as a babysitter. It's a goblin. They eat children. This is what goblins are like. They have riddles and it's just, they're not good.So they're negative.Edward: Yeah, but we can't just, it's not just the name. Like what about Spider-Man? Spider-Man is a hero, but people don't like spiders. People are terrified of spiders.Michael: And people don't really like Spider-Man, ed. We talked about this before about how Spider-Man isn't, we think it might be the mass, but it may very well be because he's naming himself after an insect that no one likes. Like it's justEdward: call himself the honey beak, make honey for you.Michael: Or maybe not do non insect related. I'm sure that you could have come up with a different costume and named himself like, I dunno, the hawk or something just jumped or whatever. Or something. But anyways, my point is that sometimes we don't really have to look that far past the name, because I think they're telling us what they think of themselves. Like we know that, say, captain America obviously thinks highly of himself and wants to in America project something. And America I bet be he cares America. America, he wants to be a representative of America. He is trying to project a positivity, right? Like Ironman is strong symbol. They're trying to act heroically, like Thor, whether Thor really is a God from Norse mythology. If he isn't and he's just a guy with crazy powers, he obviously thinks highly of himself and wants to project as a hero.Those are things that are different than, say, the goblin who's telling us, this is who I am. You know, Thor says, I want you to think of me as this striking Norris hero. And the goblin is the opposite.Edward: So what you're, what you're saying is we should start judging more books by their covers.Michael: I think we gotta take it as a hint, I think it's fair to say that you look at even the Fantastic four The Thing clearly has some self-esteem issues and he does look like a rocky monster, whereas Mr. Fantastic has zero problem. He wants everyone to know how wonderful he is.And again, he's probably, again, we've had the conversation similar to this. He probably isn't the nicest guy cuz he's, he's on the team with The Thing. He's obviously making, he's bragging about how going into space, And getting bombarded cosmic rays was awesome, Mr. Fantastic. It's amazing.And then, and then his teammate's like, oh, I'm The Thing. It just tells us that Mr. Fantastic probably isn't that fantastic, really. But at least he thinks he is. And he's projecting as a hero.Edward: So you're saying, so, so the go, the Goblin thinks he's a goblin.Michael: He thinks he's a bad guy and then it turns out he was, and you heard it and you kind of twisted yourself into some, you know, some, some knots.Edward: I'm a consequentialist Mike. At the end of the day, what happens is what matters. What happens is what matters. You got the best intentions in the world, like those communists, I'm sure they were trying to be all but love and sharing and trying to help everybody, and that the result was millions of people died Under Stalin, consequentialist, Mike, what matters is what happens, not what the intentions were.And so the goblin had really bad intentions, but he stopped some crime.Michael: I think he should read more books, ed?Edward: I think so. I think so. Okay. Well, so anyway, so the situation we're at right now is that the goblin is clearly moved from, being good in a consequentialist ba basis, but being bad in intention basis, just being bad all around. He's like, they, they think they battle around. The goblin might actually be the crime master. They're the same person. If not the same person, they're definitely working together. They're trying to take out all the other criminal underworld, combine them into one, not just take them out, but just amalgamate them into one group all under the goblin and the crime master, or well, or if they're one in the same, so that's what's going on.Clearly bad dudes. Clearly bad, but, if you're gonna use the names, a goblin isn't going to be the master of crime. The goblin is gonna be the little minion running around, but he's projecting out like master of crime now, the head of the underworld.So he's moving past his name and maybe that's why he's changing it to the crime master.Michael: Maybe, but it's not, again, that's not saying too, too, too, too far. I mean one name isn't supposed to explain someone's core identity. It's just that he's not good.Edward: That's what you said point, I thought you said it all.Not about the core identity.Michael: No. You're saying, you're saying he's more of a minion because of his name, like No, no, he's, he's just a bad dude. I'm saying that when they tell you who they are, like say the brotherhood of evil mutants, they're probably the evil mutants. You know, if they say the Avengers, they're probably the, they're probably trying to, you know, avenge a lot.Edward: What are they fantastic for? Think they're wonderful. What are the Avengers Avening, are they Avening? Anything in particular? Just in general?Michael: Well, it's a positive message. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.superserious616.com

Super Serious 616
E205: They Don't Make Villains Like They Used to (Daredevil #8) -- June 1965

Super Serious 616

Play Episode Listen Later Jun 16, 2023 7:27


Thank you for staying with us as we missed another week last week. Edward is traveling with his family this summer, making recording difficult. We still have a half dozen episodes recorded and we will trickle them out over the summer months, but there may be a few weeks this summer without an episode. But we have some fun ones coming! This one made me laugh while I was editing it… Enjoy!In this episode:Mike and Ed discuss Daredevil's recent loss to Stilt-Man. Does Daredevil even have any super powers? If not, is he just a crazy man who swings from building to building with a grapple hook? And what's up with Stilt-Man? Did he choose his own name? Why doesn't he have extendable arms as well? Is this all a joke? And if so, how did the “joke” defeat Daredevil? Behind the issue:This is the first appearance of Stilt-Man, who goes on to try out names like “Stilty” and “Daddy Long Legs”. By the end of the issue, Stilt-Man is defeated and shrunk into nothingness. That does not stop him, though, as he comes back to be active in the Marvel Universe through to the present day (he is killed by the Punisher at one point, but his clone continues to use his stilts for villainy).In this issue:A new villain appears on the scene - Stilt-Man - and he starts his career of villainy by robbing a helicopter mid-flight. Seems complicated for a heist, but there you have it. In any event, Daredevil tries to take Stilt-Man down after the heist, but does not succeed. Back in his civilian guise as Matt Murdock, Daredevil takes on a new client, Wilbur Day, who hires Matt to sue his boss Mr. Kaxton, who has stolen his patent. As the case goes on, Stilt Man continues his crime spree. It is eventually revealed that Wilbur is Stilt-Man. He goes on the run from Daredevil, and eventually, he is hoisted on his own petard when he accidentally turns his shrinking ray on himself, shrinking him to apparent nothingness.This episode takes place:After the short reign of Stilt-Man comes to an end.Assumed before the next episode:People did not really think much about Stilt-Man.Full transcript:Edward: Mike Daredevil is not dead, but he has been pretty badly injured, and I think this is what you get when you have someone who's just a vigilante with no real powers trying to take on super villains.Michael: Well, wait a minute. I don't know if he's spoken about this before, but is he a normal guy?Just in a funny costume, like he seems fine. He define seems similar.Edward: Well, define normal. You say normal to what does normal mean?Michael: Okay, so Spider-Man isn't normal, right? We know Spider-Man. Spiderman isn't normal. Climb balls and he's swinging from building to building. But what do we know about Daredevil? He fights on rooftops and kind of swings down from rooftops. Like, I could not,Edward: but he swings on a grappling hook. You could swing at a grappling hook.Michael: No, there's, there's a, there's a zero chance, even in the best shape of my life, would I use a grappling hook to swing from one building to another without a net?Edward: I'm not saying is something, I'm not saying it's a smart thing to do, but I'm saying you could do it. I think if push came to shove, I have faith in you, Mike. I think you could swing from a building to building. It's in a rope. You could, all you have to is hold onto the rope. Just hold onto the rope.Michael: Ed, have you ever gone to a cottage on a lake in the summer we're gonna a swimming hole and there's a rope? Yeah. And the rope it's tied to a branch overhanging in the water Sure. And the rope. And you grab the rope and you swing out. Yeah.That is still scary. Cause if you don't let go in time and you go back to shore and you let go, then you land on the rocks. Yeah. That's bad. As opposed to the water. So would I swing like that without the water? No,Edward: well, I'm not saying you would do it because you, cuz you have more sense than Daredevil does. Are you saying Daredevil's superpower is he's unafraidMichael: The man with no fear. I mean, he is. Pretty fearless, I suppose. But my point isn't that, that's what you would say is his superpower, is my take is that he, I think he has, he must have a superpower. He can't just be a regular guy in great shape who's like, no, cuz like, it seems like swinging from building to building isn't necessary to do what he's doing either.It's like, you know what I mean? It seems like, it seems like almost like an add-on, like gratus gratuitous s**t. Gratuitous. Yeah. Like, and it would be exhausting, think about Ed. I don't know the last time you tried to do a pull up or a chin up, but imagine that andEdward: I can do pullups and chin-ups.I can do that.Michael: Okay. They're hard cause you're lifting your full body weight up. Now imagine you're doing that a few times through the evening and then you fight. Super villain. I mean, it does seem that's,Edward: I'm saying he's making poor choices with his life.Michael: Okay. Okay. So either he's making poor choices and he has no fear, or he's got some kind of superpower. So anyways, you and I were talking about that, but you mentioned Daredevil andEdward: yeah. And then you went off on how superpowered he is and I don't know if he actually is, I think Thank you. He, he clearly has exceptional abilities, right? Whether those are super abilities or not, it feels like he's in the Captain America style. Then Captain America some sort of super soldier. Yeah. But, but he's not, he can't breathe fire. He can't fly, he can't stick to walls. And I think Daredevil's in the same class, he's Clearly very athletic. But man, is he athletic take on super villains. What's just happened is he was very soundly defeated by, basically a guy in battle armor with really long legs.Michael: You know what? They're calling him, ed,Edward: they're calling him the stilt man. The villain, the stil man.Stil man.Michael: It's just, it, it's just, it's just ridiculous. I don't mind, I love, and you and I, obviously we have, we have a show about this. I do love how humanity is evolving in these new things we're seeing, but, Doesn't it seem like we're scraping the bottle of the barrel for the influences, where you're naming yourself and your whole persona, your super villain persona is based on, in this case, stilts.Edward: Well, did he name himself stilt matter or did the media name him Stilt Man? Well, I don't know, but they, but that's what he has. He wasn't having a press, he wasn't having a press release. He was just going out and robbing things and the poor guy got labeled as a stilt guy. Well, okay, but we got it. It should have . Called him, I don't know. Armor Battle man.Michael: It'd be better, but he's clearly got some kind of body armor. That's fine. Yeah. And bullets, power bullets off him. Right.Edward: And he can got that he stole from a helicopter. He used his well, his stilts to extend upward and then, stole from a helicopter that the helicopter thought they were safe.They're like, nobody can get us up here because there's no such thing as a flying villain. Oh, wait a minute. Or a stilt villain that just came up and sell.Michael: It's just, that's the defining. Feature of it is that whatever you wanna, like stilts is what they are. He has these extendable stilts and it just seems so stupid. It's just, I don't know, for all that technology, first of all, it's impressive. It's an impressive engineering feat to say if a helicopter is 500, a thousand feet in the air, To basically be able to extend your stilts up a thousand feet and not fall over.Edward: And then, and then, yeah, balance.Look at the balance on that guy.Michael: It's incredible. It's incredible technology. It's just thatEdward: I would argue he probably more impressive than a grappling hook.Michael: I would give you that, but The Thing is, but why would you do that? Why would you spend all that engineering, why would you direct your energy towards that engineering feed where he could have created something else?Except, unless he's just going for the sort of the whimsy of, I'm a guy that has stills. I'm like really tall.Edward: He built like these hydraulic extension things that are, I think are really if you built this hydraulic extension technology and you decided you wanted to go and use it for crime? What type of battle suit would you maybe I'd have extending arms too. I'd have like extension arms to go.Michael: The arms are way more practical. Yeah, but the think with the power you'd have. Bam.Edward: But they can do the same thing with his legs. He just kick people with like his big extension. Legs and kicks are more dangerous than arms.Michael: He's not, he's extending the stilt so that he can perfectly time getting in front of a helicopter and hoping the helicopter doesn't just turn around or just,Edward: if it does, he can, can chase after climb. They go fast. He can run, his steps per minute could be very low and he could still achieve very high velocity.Michael: We haven't seen any film of this, and I'd like to because that would be interesting. But anyways, the point I'm making though is I hate it. I hate the idea that we've gotten to the point in this marvelous age of heroes and villains and super scientists and aliens and gods, and it's like, you know what? We've kind of run our course. Let's have. A stilt based hero or villain? Villain. Villain. Like a psychic ladder. Ladder boy. Like any, you know, like tall guy.Edward: I think you can be cynical on his name, but clearly Daredevil has a better name than stilt man, but like this guy defeated Daredevil. And so whatever superpowers you think Daredevil has, apparently they were not powerful enough to defeat this poor villain that you're mocking.Michael: Oh no, I agree with you on that. Even though I think the daredevil must have some powers, powers are not, he's probably exhausted by the time he flipped around and grappled through the city to then fight the stilt guy.Edward: But he has to grapple up the stilt man. You can't even get to him with those grappling hook that grapple is doing a lot of lifting,Michael: silly. Whether you're defeated daredevil or not. I just find it so silly. And I, maybe I'm okay. Don't take this the wrong way, but I feel like you and I put a lot of energy into our show talking about these amazing people, good and bad, and then along comes still, it kind of just undercuts everything we're talking about where that's what it is.It just seems so silly.Edward: He's not undercutting anything. He's way up high in the sky. Everything is below him.Michael: I just like to take his legs out cuz it just bothers me.Edward: Take his legs out. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.superserious616.com

Super Serious 616
E204: Recruiting for Strength (Avengers #17) -- June 1965

Super Serious 616

Play Episode Listen Later Jun 2, 2023 5:36


In this episode:Mike and Ed discuss the Avengers' public search for a fifth member: the Hulk. What are they thinking? Is strength the only requirement for membership? How bad is “rampaging” before you decide not to let someone on the team? Should someone take Captain America's license away?Behind the issue:Stan Lee is leaning into the idea that the team is under-powered after losing the original Avengers. The team feels the same way until they discover that when they work together as a team they can defeat powerful villains — maybe they don't need the Hulk after all?In this issue:The new Avengers meet for the first time. Rick Jones - teenage sidekick with no discernible powers or abilities - is jealous that the three new members - Scarlet Witch, who can warp reality; Quicksilver, who can run at the speed of thought; and Hawkeye, who has an uncanny martial abilities - are members and he is not. Anyways, Captain AAmerica announces to the fledgling team that their first mission is to find the Hulk to see if he will join their team. They then go to train, and a giant robot sent by the Mole Man breaks in and attacks them while informing them that they can find the Hulk in the desert. It's a trap, obviously, but the Avengers still set out for the desert and battle the Mole Man's Minotaur underground. Meanwhile, the Hulk chases down his foe, the Leader. The issue ends with the Avengers realizing that they are quite formidable on their own and do not really need the Hulk.Assumed before the next episode:People are still wondering what the deal is with this odd team of Avengers.This episode takes place:While the public considers whether the Hulk would be a good addition to the Avengers or not.Full transcript:Edward: All right, Mike, we know who the fifth member of the Avengers is or not. Is, is going to be, is going to beMichael: wild man. It's actually crazy. It's actually crazy. How do we get here?Edward: You thought given the fact that The Thing is leaving the fantastic f. For, they'd bring him in. Mm-hmm. As the big strong man. And they said, no, no, no. That's not crazy enough, Mike. That's not crazy enough. We're no, we're gonna go back to our roots and find the most powerful man in the world and bring him onto the Avengers cuz the Avengers are not the second best mark. They're not the second strongest person in the world. They're going for the strongest.Michael: Yeah so they're out there trying to find the Hulk because the Hulk is the strongest one there is. And it's like, hold on a second. He's caused a lot of damage. He's fought you guys.Edward: Of course, of course. He's caused damage. He's the strongest man in the world. How can the strongest person in the world not cause damage?Michael: He, he, He's a, well, I dunno if he's a man, he's a monster.Edward: They're, they're calling, they're, they're calling him a man. They're calling him, man.Michael: Okay. And I shouldn't be, so I don't want to be negative towards him. I don't wanna use pejorative terms.Edward: You're like monstrous. Is that a word?Michael: But he has acted monstrously, you know what I mean? Like, so he, he has,Edward: he's a person who acts like a monster. He's not a monster himself.Michael: Well, yeah, sure. That's right. And he's out there causing terror and mayhem and. Battling the Avengers.Edward: Fair enough. And so then, not just Avengers, he's fought the Avengers, he's fought the fantastic F, he's f the Avengers more. I think he's fought the Avengers more than he's been on the Avengers in terms of like Right. Which side he's been on. He's been anti Avenger more times than he's been Avenger.Michael: So, I should say, gee whiz, you know, I'd like to get married. I'm gonna marry my, the worst girlfriend I've ever had because, you know, Because she's been my girlfriend in the past and she was a great girlfriend for like a week and then a terrible girlfriend for like a month. And so,Edward: yeah. But Mike is this girlfriend the strongest girlfriend in the world.Michael: Well, okay, how about this? The most attractive, my most attractive girlfriend in the world. That's all I'm going for if I'm super superficial. There you go. And so that's kind of what it is, right? They're picking one serious trait. So yes, the Hulk is the strongest one there is, but he is the best teammate? Like, yes, this woman. Is the most attractive woman I've ever dated. But is she the best girlfriend? And it's like, I don't know. I don't care. She's like the hottest, so I'm gonna go marry her.Edward: You presumably, you only have one girlfriend at a time. The Avengers have five at a time, so they need different pieces. They have Captain America who's probably the best teammate in the world and they have I dunno, the quick silver Quicksilver was the fastest in the world and the. The witch who's the most magical in the world. And so now they don't need another great teammate. They need someone who's just they have no one who's strong. They need someone who's strong.Michael: And I think my analogy holds, it's like you're my friend and you're one of the smarter friends I have and I've got other friends.Edward: Somebody say the smartest in the world would you say that,Michael: you know, I'm not gonna say, but you might. And, uh, and then you get, and then, and it's like, gee, on outta my friend network, I don't have the hottest one. So I'm the hottest one. The hottest, craziest person, coming into my life. Which is, what the adventures are doing. So, No, I think it's weird. I think it's wrong. And also,Edward: are you saying the Avengers don't have the best judgment in the world?Michael: Yeah, I am. And then on top of that, on top of that, it's hard not to notice that the Avengers are recruiting people who, a year ago we considered to be villains.Right?Edward: No, no, no, no, no, no, no. A month ago, no, two months ago.Michael: You're right. Sorry. Time flies. So we have quick Silver Scarlet Witch who used to be in the Brotherhood of Evil Mutants. That's terrorists. They're, they're terrorists. They're terrorists. Terrorists. Terrorists.The Commonwealth War Hawkeye Hawkeye, who was like, oh, no. Criminal?Edward: No, no, no, no, no, no, no, no. He was also a super spot. He was working with the Russians and the Soviets.Michael: That's, that's right. And then they're like, you know what? Okay, we've covered, we've covered those areas. Let's get a guy who rampages.Edward: We have, we have no vandals. We need a vandal. Vandal, the terrorist, we have the communist. We need just someone who's pure, pure anarchy.Michael: Like is Captain America a right? Is he making the decisions right now? It's like he's a little older. I guess he's been around since World War ii. Do we just step in and say like, you know, you step in and take away your parents' driver's license. You gotta say cap. You know, if you're the one driving this bus, we gotta, we got some questions, we got some concerns here.Edward: What's what's amazing to me, it's not just that they want the Hulk, it's that they haven't spoken to the Hulk. It's not like they just gotta put it out there. It feels like, it feels like, yeah, exactly.If you want the Hulk, let's get the Hulk in the room and ask and be like, Hey, listen, it's like selecting a vice president. You don't go and say, Hey, I'm looking for you like, uh, uh, Mr. Uh, vice president. Um, do you, uh, are you, uh, are you out there? I'm just gonna put an ad in the newspaper and maybe you'll. Come to me. No, you take them aside one by one and be like, Hey, if we were to ask you, would you join? And oh, by the way, if we were to ask you to join, would you stop rampaging? Would you stop destroying cities? Because that's kind of a requirement for the organization. But right now they've reduced all their ability to negotiate.The whole comes along. It's like, yeah, I'm gonna join. You want me to join? I'll join. But here's my requirements. I get to destroy five buildings every week. Take it or leave it, then what do you do? And then what do you do?Michael: And I might get into fist way with you, you know, so just, just like it or lump it, but it's happening and it's like, well, okay, maybe we shouldn't like it.Edward: Maybe putting ads and newspapers across the country was not the right choice. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.superserious616.com

Super Serious 616
E203: Post-Avengers (Tales to Astonish #68) -- June 1965

Super Serious 616

Play Episode Listen Later May 26, 2023 11:40


In this episode:Mike and Ed discuss life after being an Avenger. What are the responsibilities? What are the privileges? Do they get top secret briefings? Are they like ex-Presidents? Or like ex-FBI? Who pays for the damage they cause when Giant-Man decides to grow to 35-feet in the middle of the city and starts knocking down buildings? These are unprecedented times, but someone has to figure this out quickly!Behind the comic:This is the first adventure of Giant-Man and the Wasp post-Avengers. The story continues into the next issue, but at that point they “retire” and the title converts to dual stories of Namor and the Hulk. It turns out Giant-Man just wasn't that popular. It didn't help that Tales to Astonish had consistently been one of the weaker titles for the previous few years. Something needed to change. Also in this issue, the Human Top, who was originally introduced as a “normal human” who just happened to be able to spin quickly, has now developed the ability to fly…In this issue:Giant-Man and the Wasp are practicing just outside the city. A plane intentionally flies into Giant-Man, and the pilot, the Human Top, considers killing him but does not have time before Giant-Man wakes up. The Top splits, and Giant-Man returns home. Giant-Man practices his growing ability in downtown Manhattan. The Human Top then returns and battles Giant-Man and the Wasp, and Giant-Man is enraged when the Top leaves with a captured Wasp.In the Hulk story, the Hulk saves Major Talbot from dying during the Leader's attack. Then, when the Hulk has turned back into Bruce Banner, General Ross places him under arrest for treason. The leader sends his humanoid minions to the base where Banner is being held, and while they attack Banner, he turns back into the Hulk and battles them but is knocked out as they steal an invention of Banner's for the Leader's use.Assumed before the next episode:People are fed up with Giant-Man leaning on their buildings, carelessly causing damage.This episode takes place:After Giant-Man has leaned on one too many buildings.Full transcript:Edward: Mike, what do you do when you retire from the Avengers? What's next? What's next on your plate?Michael: I don't know. It's hard to go higher in the superhero community, but it's also harder to get a better job in even the military or that kind of like super diplomacy communityEdward: and super diplomats.Michael: Well, that's what they are, right? Like they're like, I don't know, like Warrior Kings in a way. Right?Edward: Thank you for your service, giant man. I'd not like you to be the diplomat in charge of Poland. Over there with the wasp. You can help us deal with geopolitical situations in the Eastern Republics.Michael: But that's what they've been doing though. They've been acting asEdward: the last time giant man went into the Eastern Europe, he was crashing through the Berlin wall. It's not diplomatic, it's not known for diplomacy.Michael: No, but his actions, whether they're clumsy or not, were actually affecting international relations. So that's what I mean, like the general sense of whatever they are.Edward: Yeah. So causing diplomatic relations is not the same as being a diplomat, just cuz they both have the word diplo in them.Michael: No, no, no. I'm not saying that they're, I'm not saying that that's the job. It's just that what have the Avengers been? They've saved the world. They've battled villains. They have taken upon their self to go to other countries, to act in America's interests.And then at times we've found that they've acted secretively to the same extent, further in the interest and theory of America. So I don't know what you want to call them, but they're not regular. And so you're, they're not regular. And, and your question at the start was like, well, what do you like, what do you do when you retire?Well, it's not unprecedented, but it's unusual. And so it's a good question.Edward: And so what's unusual, you're saying retiring as a superhero is unusual or retiring as an avenger is unusual. What's unusual?Michael: Retired from the Avengers is unusual because, well, yes, it's Avenger.Edward: Avengers have only been around for a couple years. No one has retired until now. But now we've had, now we have three retirements, sorry, four retirements, 1, 2, 3, 4, all at the same time.Michael: Yeah. And my point is that it's unusual. We have an experience where someone with that much power who's had such a fascinating role and influence on world affairs, is now no longer in that position? I think there's a qualitative difference between being on the Avengers and being the go-to team for. Pretty much any big problem to be on their own. Are they still on the payroll or at least getting the status and the influence they had on Avengers?Edward: I wouldn't think so. If you're not, you can't be like, not on the Avengers, but still getting all the Avenger privileges.Michael: That's right. So that's what I mean. Somebody that tied in to International affairs in such a highly visible way and such an influential position, I would think that they don't just retire and, then our intelligence organizations are like, that's cool.I guess you just. Have all this knowledge and this know-how, and you just go off and do what you want. So I'd imagine that there's something that must tie them closer. Oh, I see what you're saying. It's like maintain them and to be still being sort of a post adventure, but still in the family. You know what I mean?Edward: Got it. You're a post, you're not in ave anymore, but now you're a post a event. It's like a presidents. When presidents retire, they still have the secret service. Follow them around everywhere. They still get paid. Right., if you're an ex-president, you still get a salary.Michael: I think so. Or some kind of pension, I don't think they'd wait till like they're, you know, like most of 'em seem to be quite old when they're president, when they retire. I don't think they, they have to wait long before they get the stipend. Right. Which makes a lot of sense as well, cuz you don't want them to Go out and say, I've been the president of the United States for eight years and now I'm interviewing for this job at General Electric.Or I might go, I think I'd like to go work in Hungary. You know what I mean? I don't think that they're gonna be like, what's next for me? As if it's just like anybody in the world. They're just not. And so I think get to pay them enough to keep them on the bench in a way, and still get to know-how and the benefit of the expertise and still have them available to contact them.I would think.Edward: Okay, there's an ex-presidents club. You think there's gonna be an ex Avengers club where they all get together and come back together and talk about, I dunno, I guess the new Avengers can ask the old Avengers for advice the presidents do that sometimes. Yeah.Michael: I think so. I mean, I'd like to think so because the alternative would be that the Avengers, so somebody who's been so tied into our security and the intelligence organizations, but also our military and our political affairs is just suddenly like, huh. Well, I gotta make a living not an Avenger anymore.Edward: Maybe I'll go rob Banks,Michael: right? Or maybe I will go maybe work for, another country. I mean, like they could, and it's unusual, like the adventures started as this voluntary group, but very quickly became integral to our security intelligence organizations, et cetera.but I bet that there are those types of organizations and associations already. I bet they just attach that type of structure over to the Avengers to make sense.Edward: Paul, you're saying there's other structures like the Avengers out there?Michael: You used presidents ex-president, as an example.I think there has to be some kind of process they can follow to say, time.Edward: But the difference is the presidents, like that's part of the constitution, like that's built into the fabric of our country and there are rules and regulations that go back. Hundreds of years. The Avengers are a couple years old.We don't even know exactly how the Avengers are affiliated with their government, how they're affiliated with Stark Corp. They're all part of this military industrial complex, and I don't think we understand what's going on. It's definitely not the way we understand what happens with the president.Michael: Well Ed, I'm not saying I'm cool with it. I find it to be the most weird you know, and people that listen to our show know this. I've always found it to be the weirdest thing that the military, the government, our intelligence organizations are like, I don't know, better get the adventures involved. I've always found it to be strange, but whether it's strange or not, they're tied in and they have this connection and they have this. Powered authority in our society. So just to have them float off and possibly just what, decide that they want to, take what they know and not do anything with it, or,Edward: yes. You're basically say we should bribe them so that they don't do that. We should have tax dollars go towards paying giant man and Thor and Iron Man in the wasp and tell them, Hey, here's a hundred grand. Uh, please don't work for the Russians.Michael: I think, I wouldn't use the word bribe, but I think it's incentivized, I suppose, but's be honest, let's be honest. You, I've had shows where, where your solution is like, I guess we gotta kill them. Or lobotomized them. I'm like, no, I'm just following your well trod path on this one. Like probably need to pay them is the better alternative than like, Like, where I know you want to go on these things where it's like, too dangerous of your life. See you later.Edward: You know, I'm gonna tell your wife about the things you've been doing, unless you give me an incentive to not do thatMichael: well yeah. It's, like, protection, money protection.Edward: I'm not gonna, uh, bust into your shop, but, you know, I need some incentive to make sure that it stands up. Okay.Michael: But Ed, you wouldn't characterize it as bribing that you say, Let's say Kennedy, who's a young president, let's say. He hadn't been assassinated and he continued on, and he retired after, let's say he served two terms. He would've been in his early fifties, you wouldn't have considered bribery to pay him a pretty healthy pension.Edward: No, you're, right. It's not bribery to have to pay someone to do their job.Michael: It's a role.Edward: It's an incentive pay. It's an incentive. So that you go and do The Thing that we we're paying you to do. I think bribe, connotates something illegal, right? Or something underhanded. What's what's going on here though, is, it kind of is underhanded, because it's not public, it's not well-known. Is Stark Corp paying their post avenger salary? Is it the government? That's to me the, big question. And the other thing is that well at least giant man is still active. We haven't heard much from about Thor Iron Man, but, it's Giant man is out there. Experimenting and doing more stuff. Like the latest things on Giant Man is he can now grow to 35 feet tall. He's getting bigger and bigger, so his power levels are increasing. And he's doing it right in the city. He's damaging buildings, he's doing practices. He weighs tons with tons and tons of weight, and he's walking through the city causing damage.And so in the past when that happened, the Avengers had some sort of fun that paid for that stuff. Is there a post Avengers payment fund now too?Michael: That's part of the reason why I was thinking about this, there has to be some kind of structure in there. Not just about the idea that they have information that would be damaging, to our interests if they went somewhere else, for instance.But also if giant man is practicing growing in the cities, and holding onto buildings so he doesn't fall down. He's causing damage. And in the past, it's still irresponsible them to do that. But at least there is some kind of recourse for the regular person or insurance companies. He get some kind of, kind of like, you know, fix, fix the masonry on this. You know, likeEdward: fix, it's like an irresponsibility reading. As an avenger you can have a 10 on irresponsibility, but now that you're post Avengers, let's bring that irresponsibility level down to a six or a seven.Michael: And he hasn't, you know what I mean? Practicing growing around buildings when you wait tons and could knock one over if you just tripped, is not responsible.Edward: And also grabbing, grabbing onto the edges of buildings and like having bricks fall off. It just seems a little dangerous.Michael: It's super dangerous. So that's why I think that there must be something in the way, some process or some similar continuation of coverage.Really. Like I know when lawyers retire, we have mandatory insurance and then when you retire you can have runoff insurance, which would cover you. So you might get a claim, there's only so long you can Sue your former lawyer there's limitation periods and then you'd wanna make sure you cover. So if you did get sued,Edward: the insurance covers you, not for the time that you were a lawyer, but the insurance is covering you for right now. Like, for example, if you stopped your insurance today, And you got sued for something you did yesterday, the insurance wouldn't cover you.Michael: No, so insurance covers terms, so as long as you have occurrence base and claims based policies, but the most common policy would be like if you get into a car accident, you have insurance policy with company A, and then you get sued two years later. B, you no longer are insured you by that company. You're run to another insurance company. It's the company that was on risk that would cover you. And so I'm saying for, Lawyers when they retire, they wanna make sure they've got insurance and coverage, to continue a bit longer. I see I'm diving into stuff. I'm not a hundred percent sure I'm far from retirement, but I just know that there is coverage up.Edward: There's something, there, something, there's something's something there that's a giant man probably has some sort of insurance policy that's covering him post Avengers, some sort of runoff policy that lasts for some period of time.Michael: Or you just have the Avengers have so much money at their disposal. They're either self-insured in a sense, or they just have money to pay. But whatever it is, I think that you don't have these retired Avengers running around causing damage and then not, and then what you're gonna Sue giant man, you're gonna find out where that guy, who he really is. Or do you still follow the process that is in place that we we're aware of where they could make a claim. Because of the damage that the Avengers caused, which I think is a way that's kept people kind of okay with them in general.Edward: So if he has to have this coverage that keeps lasting, like we're kind of paying for giant man for the guess for the rest of his life or for some time period.Does he have responsibility then too? This is like reserves in the military. I think we can call back up giant man if the Hulk was rampaging through the city and we're like, you know what? The Avengers are a little weak right now. We need some, uh, we need some more bench strength.Can he be called in?Michael: I don't know. I mean I would think so. I would think that's part of the deal. Like we said at the beginning, it's unusual and unprecedented about what they are in our society, but they are unusual. They are unprecedented is so, you and I are just trying to speculate about what should make sense.And I think what makes sense is that if they're out there, Having information or abilities that could harm us if they were no longer on our side. I think that there's a built-in incentive to have them close to home, really. But also if they're out there doing activities, and they're more or less government agents, which they have been.I think there should be some kind of recourse for regular people. Otherwise people would not be as keen about Giant man doing his calisthenics in the middle of the city.Edward: Like you're sounding more and more like the Avengers are like the mafia. Once you're in, you can't get out. You think you're out and we pull you back in.Michael: I'm not saying that they're not like that. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.superserious616.com

Super Serious 616
E201: Lobotomy or Death! (Tales to Astonish #67) -- May 1965

Super Serious 616

Play Episode Listen Later May 4, 2023 16:24


In this episode:Mike and Ed discuss the shocking loss of scientific skill among the country's top scientists. It clearly seems purposeful, but what is the purpose? Aliens trying to keep humanity from developing new technologies? A domestic test to take away targeted abilities from exceptional people? Will they be able to take away superpowers next? And if so, is it ethical? If we can't keep someone in prison, is the choice really between lobotomizing their abilities or capital punishment? What is the ethical choice? Ed and Mike disagree!Behind the issue:The after-effects of this issue result in Giant-Man unable to shrink smaller than a normal human for the remainder of his time in this title (which is ending soon and will be replaced with Namor. More on that when it happens!). Otherwise, nothing special here. In this issue:A guy is driving around town while being directed by a man in a hidden laboratory in a funny costume named the Supreme One. When the driver sees Giant-Man, he decides to zap him in a green ray, which causes Giant-Man to grow weak. This is because the ray is designed to steal power. The Supreme One becomes obsessed with stealing Giant-Man's power, as he was unable to do that the first time he had someone try. To that end, he has his minion drive around town bathing scientific geniuses in the green ray, stealing their next-level scientific abilities, i.e. a top physicists forgets everything he knows about physics, etc. Giant-Man and the Wasp investigate, eventually tracking down the Supreme One, who escapes in a spaceship (turns out he is an alien).In the second story in this issue, the Hulk fights the army in a foreign nation, and when he turns to Bruce Banner, he is captured by some locals. Major Talbot is sent in to rescue Bruce Banner, and the episode ends on a cliffhanger - will Talbot and Banner fall to their deaths as they escape? Tune in next week!Assumed before the next episode:People are wondering what is happening to all the smart people. They are getting … less smart? How does that make any sense?This episode takes place:After people learn of the de-smartening that is happening.Complete transcript:Edward: All right, Mike, we're gonna change it up this week. We're gonna change it up a little bit because I have a story I think we should be talking about that's not, well, maybe it is superhuman. The scientists around the world are losing their scientific abilitiesMichael: right?Edward: So these are top physicists who are losing the ability to do physics or top geneticists who can't do genetics anymore. Top chemists who can't do chemistry anymore. And their brains can still do everything else. They can still have conversations, they can still love their families, but they're losing their scientific abilities. And so I think this is a super thing. We don't know who's doing it or why, but it sounds superhuman.Michael: Okay, before we get to this superhuman, if they're superhuman. Not saying that what you're saying is thatEdward: No, I'm not saying human. It's a superhuman, some sort of superhuman thing. I don't think we know any scientific way to remove parts of knowledge from someone's brain like that feels like a superhuman thing.Michael: Right. So you're saying that there must be a purpose to it. This phenomena that's only targeting extremely intelligent and highly accomplished and specialized people like physicists. They're being targeted and their abilities are removed, which. Yeah, it doesn't sound normal.Edward: Um, well, it's never happened before, so therefore it is by definition, abnormal. Although it's abnormal, it's happening more and more now. So is it becoming normal? It's becoming normal. It was not normal, but now it is.Michael: It's normalized almost, and so normalized.So I guess the first question is, what's the purpose of it? So your first thing is that you're thinking that there's a super villain possibly, or an alien or something that is doing this for a reason. Right. In that it's making humanity weaker. It's making our ability to defend ourselves worse. Worse. Is that where you're kind of going on it,Edward: it sounds that way. Like, oh, you're right. Maybe it's a villain who's doing blackmail, but it seems purposeful. If it was a virus, That was just spreading around, right? And causing brain damage to people. First of all, that'd be terrifying, but secondly, it feels like that viruses don't work that way. The viruses wouldn't go and attack just the most intelligent top scientists in the world and just attack their scientific knowledge and leave everything else untouched. So you're right, it seems purposeful.Michael: And that's alarming because we know that in the last few years, in addition to what appears to be naturally occurring superhuman abilities and extraterrestrial or, paranormal, superhuman abilities, we have seen that there's been greater advances in technology, in science that have allowed humanity to reach new levels. So Iron, Man and other, you know, giant. Giant man have been able To create things that are just impossible they're fantastical. It's basically modern magic, the science that they've been able to wield so is this a preemptive attack, a taking away the ability of other people to create such modern miracles?Edward: Oh, you're right. Yeah, it could be stopping the creation of new superheroes. We know, if you look at the superheroes that are out there, a handful of them, like the X-Men seem to be that this people who are born with this weird gene that's being activated by something.But for most superheroes out there, or, super villain for that matter. It seems to be either, Some sort of science that science is doing it. That's right. Captain America is experimented on and turned into Captain America, like the Reed. Richards took fantastic four up into space and space stuff turned them into the Fantastic four. Sandman was like atomic research, whatever turned him into Sandman. So it feels, or to your point, Iron, Man and Giant Man was actually, or the porcupine, they're actually building technological wonders. And so if our top minds, the people who can like do the engineering, the people who can understand the atomic science are losing their ability to do that.Hey, maybe it is aliens. Maybe aliens are trying to put humans in their place and say, Hey, stay on the planet Earth. Stop leaving and stop developing powers.Michael: It's wild. It sounds paranoid, but at the same time it's starting to make a lot of sense. This will fundamentally weaken humanity. By taking our top scientists off the board. That's right. Quite frightening. That's right. But then the other part of it is leaving side the motivation which is alarming and I'm hopeful that say the Avengers or the various federal agencies are on top of this, you gotta wonder how they're doing it. Like how is it that they're doing almost micro lobotomies. Is it a technological basis for it or is it magical? How exactly are they doing it at all.Edward: You're right. Clearly, it's not something that anyone has done before, but someone has found a way to go and do, lobotomy is a good word. It's a very, it's like a targeted lobotomy. Because what's fascinating about this is it's not like these scientists are coming in with other brain damage. They're able to continue on their lives. Normally. They are still able to, whole jobs. Not even like they can't do normal stuff. They can do all the normal things. They just, it's like this piece of knowledge. They're cutting edge brain power and I don't even know if their intelligence was affected so much as their knowledge was affected. So if you're a scientist who's like really brilliant and spend 40 years of your life diving deep into physics, you're not gonna be able to spend another 40 years we just don't live long enough.Michael: It's quite a violation of their autonomy too. I don't want to discount that, but, however they're doing it, it's wild. And you gotta wonder if it's not some extraterrestrial kind of thing or some kind of super thing. What if it's actually a, just, it's something more domestic? We talked before about, What do you do with these super villains that you capture and have these amazing abilities? Like say, let's say Sue Storm turned into be a bad person and she has force fields and can turn Invisible. Like how do you deal with that and make, and IM prisoner if she was a villain, is this. Some technology that somehow got into the world where they've been experimenting on how to turn off abilities and it's got into the wrong hands and they're using it to turn off the abilities, for lack of a better term, of regular humans.Edward: If you're right, maybe it is just an experiment then, and they're testing to see if they can turn it on and off before they say, Hey, let's turn off the superpowers of. Sue Storm or Reed richards. Let's turn off the brain power of some physicists and you're right, if it doesn't work and they can't turn it back on again, that would be really bad. But not as bad as if we like turn off the superpowers of the Avengers because hey, that's irreplaceable.Michael: It does lead into to a consideration of like, how if this is like a deliberate thing that might be done by people on our side, say a government kind of project that got the wrong hands, that tells us I guess I've ever thought about the idea that turning off, say, superpowers is akin to a pure violation of a person's autonomy, right? It's more relatable in a way to basically make a very intelligent person, less intelligent in a particular area that is actually, it's so remarkably unethical, cuz it is effectively targeted Phlebotomy.Edward: Clearly whether it's just happening to Random intelligent people, it's unethical. But if we did this to get against the guy who was building the porcupine suit or the wizard who is like notoriously committing crimes and breaking outta prison and committing the frightful fore attacking the Fantastic four, if we just reduced his intelligence and stopped his ability to go and create these fantastic suits, I dunno, is that still unethical?Michael: I think so. Yeah. Yeah. It, definitely is it is a version of lobotomizing those intelligent people. We don't do that right now. There have been super intelligent people in history and if the choice is to build a better prison or to lobotomize somebody, you would choose you should choose to build a better prison.Edward: That's fair. And I guess I feel like we haven't really. On that route, far enough. We still are building these terrible prisons and allowing these criminals to escape again and again. But I guess let's go further. Remember there was the vanish. Do you remember the vanish, right?Yes, I did. So that's, yeah, so the vanger had the ability to teleport and, I'm not sure how he was dealt with, I assume, like we assumed at the time maybe that they just killed him. There was just a extra, judicial murder to take this guy out because otherwise what do you do?You can't put in prison someone who can teleport outta prison. He was teleport into the Oval Office. He was threatening the president. You, can't stop someone like that. And so if we had, if for the vanish or. Let's say what they had this ability to turn off his power. Or, and along the way it also turned off his ability to do complicated differential equations. It feels like that's a better alternative than allowing him to go free or a better alternative than murdering him.Michael: Yeah. But it's the same, you know, The Thing with ethics is that they're not relative. This goes to, the question I suppose, is the ability to have like a superhuman power, and you, if you remove that, is that the same as effectively doing a version of a targeted lobotomy? And I think the answer is yes. I mean, I think that the Vanger, even by basis of just looking at his name, He identifies, that's a core part of who he is.Edward: He enjoys vanishes, and if he stops vanishing, then who is he anymore?Michael: Well, exactly. And so to remove that from him,Edward: it's, I'm the talker. If you take away my, if you make me mute, who am I?I can't, I can't, I can't do The Thing that I do.Michael: But it, but it's the same thing, like, so it is the same thing removing an ability for somebody to solve differential equations as a top physicist is the same as taking away a person's ability to, in this case, do a unique thing, which is the ability to,Edward: so I'll grant you that, but the difference is, is that the guy doing the differential equations isn't trying to murder the president. It feels like that. Like that's the difference. You're right. I don't think we should go and find everybody who can teleport and then go and take away their abilities. That seems like a draconian a totalitarian government that would do something like that. But if there's somebody teleporting around murdering people, I think by all means we should stop that person. And if that means taking away their ability to teleport, I think so. Be it.Michael: I guess the question is, what is a worse and more abominable crime towards an individual or harm that you could cause them? Is it one to give them effectively a brain injury so that they are not the same person as they were before, because that's what you're doing if you turn up abilities. I think it's similar to making somebody less, less intelligent to like solve differential equations either argues the same as turning off their ability to do what they're born to do, which is teleport. So it's a better termEdward: to murder. I was born to murder precedents.Michael: Wait, so you either give them effectively a brain injury, so you actually violate what they are as a human at who they're as a person. Their core being or you killed them, is what you're saying. Or you build a better prison. Yeah. Yeah. And you're saying you handled a better prison. It's only two choices.Edward: That's right. That's right. So I think we are all agreed that if you can build a better prison, you build a better prison that feels like the right thing to do, I think. Mm-hmm. When you can't build a better prison, when you have someone like the vanish or the absorbing man who can, if you put him in a prison, whatever you. Put him in, he can absorb the strength of that thing and bust his way out. And so what do we do? The absorbing man, they set him into space to drift aimlessly for eternity. Like that seems worse. It feels like if you had a choice between, that's the worst one. Drifting through space for all eternity, or losing the ability to absorb the strength of materials around you. I think most of us would give up the ability to absorb, even if our name was the absorbing man. It feels like you can get a new name.Michael: Hey. They sit him down and say, listen, here are the two alternatives. We've been up all night thinking about the options here, and one is that we turn you into a race that'll float through the empty space forever, or we give you, effectively we change your brain chemistry. And I think that, historically, it's a pretty slippery slope when you start messing around with people's brains and changing who they are. I don't know what the right answer is, ed, but I have to say youEdward: really don't know the right answer. You really think that maybe the right answers to have 'em drift through space for all eternity.Michael: I don't know. You're forcing me to say that. I think it'd be better. I think it would probably be better to actually like, uh, And I'm against a death penalty. But that seems to be preferable to actually really lobotomize againstEdward: sin. Bomb the ball. No, no, no, no, no, no. Listen, imagine. So let's put you in that, those shoes. Okay? Now, Mike, you now have the ability to fly. You are flying, man, and you could fly around and so on. But you know what? You used that, you used that flying power for evil, and you started killing presidents. And so now they're like, Mikey, you need to go to jail. Unfortunately. This metaphor is falling apart because we could put a flying guy in jail. You,Michael: you put a, the ceiling solved the problem, ed.Edward: Okay, Mike, you have the ability, we're gonna use this vanish again. You can teleport Mike, you can now teleport everywhere and you're murdering people left, right, and center. Because you know what, maybe the teleporting also meant your brain go, went crazy, and the government comes to you and says, Hey Mike, we have two choices.We can take away your ability to teleport and you'll go back to being old Mike. Or we can murder you. Are you really, are you like, have you given that choice? Like you think the right choice is to murder you?Michael: Uh, it's, it's just such a hard It, it is. It's not hard. Murder. Murder is a problem. The slippery slope stuff is terrible.Eddie, you're actually,Edward: yeah. But one of them, one of them has a slippery slope. The other one is a giant hole of death.Michael: You know what I think because,Edward: you can recover from a slippery slope, you can't recover from a murder.Michael: Eddie, I'm a lawyer. I'm not a judge. I'm not making that call right now. But you're, but clearly I know where it goes with you. You'd be like, take away my ability. Give lobotomize me so that I don't go out and vanish anymore and I'll live the rest of my life.Having you having fundamentally changed what, who I am as a person? Yes. Yes. How is that any different than Lobotomizing people that. The state didn't, consider to be, desirable?Edward: Well, we've already, I think the difference is, is we've agreed that you are only doing this as a last ditch effort. We're not saying, Hey, you're a murderer, a normal murderer who like walks around with knives and guns. We'll just take the knives and guns away from you. Even though you call yourself gunman and you define yourself by using guns, we're gonna take away the guns. And then, and you're like, oh, but I can't be gunman without guns.Well, too bad you're no longer gunman. You are now just man, and we're gonna put you in a jail. And that jail is not gonna give you access to guns and that's the preferred choice. But if you can't, but if you can't put them in the jail, you need another choice. And the second choice should not be killing them indiscriminately.Michael: So I guess the problem and hear me out on the slippery slope, but like if the technology is developed and you can use it on these, in these extreme situations, my fear is that you use them. Even if you could rationalize that, you would use them in more mundane situations where all prisoners, all people convicted of violent crimes are now gonna get, effectively get a lobotomy because it's safer.Because you can't keep them in prison forever. Or if you do, the prisons are unsafe, et cetera. There's gonna be a rationalization for actually using this technology to effectively lobotomize them too. So it won't be limited, I'm afraid to this very unique situation that. The teleporters of the world. I wish we know there's one. And it could extend and it could, it would extend what I consider to be an abomination throughout. Oh, again, you're worried Our society.Edward: Well, maybe we just put in rules in place that the person needs to choose to have this. We just get to a certain point where it's like, Hey, you can choose to be lobotomized or murdered, and if you prefer murder, we can do that for you.The state's really good at murdering people.Michael: I think it's what, I think one of those, that's what they consider to be actually not a real choice. Ed, I thinkEdward: know that's the point is, but like, we're stuck at this point where we have to choose the choice. We don't give them three choices if it's not like we can take away your powers, murder you or put you in a jail that you can escape from in two seconds. Which do you choose now? Well, clearly the guy just escapes from jail and so that's not an acceptable choice for our society. We need to stop the vanger and people like him from murdering people. And so far it seems like what we're doing is we're just murdering. We murdered the vanger and we sent the absorbing man into space. And this molecule, man, we don't know what happened to him. These people who are extremely powerful. They seem to just be disappearing and we're not talking about it. That is the slippery slope. And so this is a way to reduce the murdering this against villains.Michael: Well, if I had to guess. I suppose the murder's been working out. At least that's what's been happening and I think it's unfortunate. I think it's horrific. And so what I hope will happen is that maybe if the government is secretly funding this research into this technology, maybe they should direct their attention. Towards better prisons that would solve the problem and avoid these thorny issues. That, that you're pushing on me.Edward: Teleportation proof prisons. That's the next scientific achievement. Read Richards. Go do it.Michael: Send them to Asgard Ed. We know that they must have their, they're superpowered.God's like Thor. They must have the technology up there to deal with strange, unique powers. Let's, let's, let's start talking about that.Edward: Vanisher, get off Earth. Go murder Odin. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.superserious616.com

Five in the Eye
Five in the Eye 408 with Olu

Five in the Eye

Play Episode Listen Later Apr 28, 2023 36:33


MICHAEL Hello and a very warm welcome to episode 408 of Five in the Eye - your favourite news review show, right here on Colourful Radio. This is me - Michael Ohajuru - looking forward to looking back over some of the stories that have recently caught our eye - Phil's away this week so we're joined by an old, old friend of the show Olu Alake OLU Great to be here Michael looking forward to debating the news with you.We kick off with rising cost of living - a Bank of England economist is tell us  we should accept our reduced living standards in week when the baby soother Calpol is the number one shoplifed item in one of London's poorest boroughs what's happening to our economy  MICHAEL For story number two we ask When is an apology not good enough? The curious case of Diane Abbot. OLU While for story number three we ask is Harry right to pursue his battle for justice in the courts? He seems to be  fighting on two fronts: the Royal Family and the Murdoch news empire, can he win ? MICHAEL Meanwhile for story number four can you believe what we see with our eyes on the planet Venus ? Seems one astronomer  did and he got it very wrong  OLU And our final story this week ? An teenager year old goes underground to get away for his parents 8 years later he has a habitable home with mod cons    MICHAEL Well we're really digging deep for this week's show  - that's this weeks' five in the eye! +++++

Screaming in the Cloud
Sysdig and Solving for Strategic Challenges in Cybersecurity with Michael Isbitski

Screaming in the Cloud

Play Episode Listen Later Apr 25, 2023 33:39


Michael Isbitski, Director of Cybersecurity Strategy at Sysdig, joins Corey on Screaming in the Cloud to discuss the nuances of an effective cybersecurity strategy. Michael explains that many companies are caught between creating a strategy that's truly secure and one that's merely compliant and within the bounds of cost-effectiveness, and what can be done to help balance the two aims more effectively. Corey and Michael also explore what it means to hire for transferrable skills in the realm of cybersecurity and tech, and Michael reveals that while there's no such thing as a silver-bullet solution for cybersecurity, Sysdig can help bridge many gaps in a company's strategy. About MichaelMike has researched and advised on cybersecurity for over 5 years. He's versed in cloud security, container security, Kubernetes security,  API security, security testing, mobile security, application protection, and secure continuous delivery. He's guided countless organizations globally in their security initiatives and supporting their business.Prior to his research and advisory experience, Mike learned many hard lessons on the front lines of IT with over twenty years of practitioner and leadership experience focused on application security, vulnerability management, enterprise architecture, and systems engineering.Links Referenced: Sysdig: https://sysdig.com/ LinkedIn: https://www.linkedin.com/in/michael-isbitski/ TranscriptAnnouncer: Hello, and welcome to Screaming in the Cloud with your host, Chief Cloud Economist at The Duckbill Group, Corey Quinn. This weekly show features conversations with people doing interesting work in the world of cloud, thoughtful commentary on the state of the technical world, and ridiculous titles for which Corey refuses to apologize. This is Screaming in the Cloud.Corey: Tailscale SSH is a new, and arguably better way to SSH. Once you've enabled Tailscale SSH on your server and user devices, Tailscale takes care of the rest. So you don't need to manage, rotate, or distribute new SSH keys every time someone on your team leaves. Pretty cool, right? Tailscale gives each device in your network a node key to connect to your VPN, and uses that same key for SSH authorization and encryption. So basically you're SSHing the same way that you're already managing your network.So what's the benefit? Well, built-in key rotation, the ability to manage permissions as code, connectivity between any two devices, and reduced latency. You can even ask users to re-authenticate SSH connections for that extra bit of security to keep the compliance folks happy. Try Tailscale now - it's free forever for personal use.Corey: Do you wish your developers had less permanent access to AWS? Has the complexity of Amazon's reference architecture for temporary elevated access caused you to sob uncontrollably? With Sym, you can protect your cloud infrastructure with customizable, just-in-time access workflows that can be setup in minutes. By automating the access request lifecycle, Sym helps you reduce the scope of default access while keeping your developers moving quickly. Say goodbye to your cloud access woes with Sym. Go to symops.com/corey to learn more. That's S-Y-M-O-P-S.com/coreyCorey: Welcome to Screaming in the Cloud, I'm Corey Quinn. I periodically find myself in something of a weird spot when it comes to talking about security. I spent a lot of my time in previous lives having to care about it, but the word security was never in my job title. That's who my weekly podcast on the AWS Morning Brief and the accompanying newsletter goes out to: it's people who have to care about security but don't have it as part of their job title. They just want to know what's going on without all of the buzzwords.This promoted guest episode is brought to us by our friends at Sysdig and my guest is Mike Isbitski, Director of Cybersecurity Strategy at Sysdig. Mike, thanks for joining me.Michael: Thanks, Corey. Yeah, it's great to be here.Corey: So, you've been at Sysdig for a little bit, but your history is fascinating to me. You were at Gartner, which on the one hand would lead someone to think, “Oh okay, you talk about this stuff a lot, but might not have been particularly hands-on,” but that's not true. Either. You have a strong background as a practitioner, but not directly security-focused. Is that right?Michael: Yeah. Yeah, that is correct. I can certainly give the short version of the history lesson [laugh]. It is true, yes. As a Gartner analyst, you don't always get as hands-on, certainly talking to practitioners and leaders from all walks of life, different industries, different company sizes, and organization sizes.But yeah, as a Gartner analyst, I was in a different division that was much more technical. So, for me personally, I did actually try to tinker a lot: set up Docker, deploy Kubernetes clusters, all that fun stuff. But yeah, prior to my life, as an analyst, I was a practitioner, a security leader for close to 20 years at Verizon so, saw quite a bit. And actually started as enterprise architect building, kind of, systems and infrastructure to support all of those business needs, then I kind of transitioned over to application security towards the tail end of that career at Verizon.Corey: And one of the things that I find that I enjoy doing is talking with folks in positions like yours, the folks who did not come to the cybersecurity side of the world from a pure strategy advisory sense, but have been hands-on with these things at varying points in our careers, just because otherwise I feel like I'm sort of coming at this from a very different world. When I walk around the RSA show floor, I am consistently confronted by people trying to sell me the same dozen products over and over again with different words and different branding, but it seems like it's all buzzwords aimed from security people who are deep in the weeds to other security people who are deep in the weeds and it's just presumed that everyone knows what they're talking about already. And obviously worse. I'm not here to tell them that they're going about their business wrong, but for smaller companies, SMBs, folks who have to care about security but don't know the vernacular in the same way and don't have sophisticated security apparatus at their companies, it feels like a dense thicket of impenetrable buzzwords.Michael: Yes. Very, very fair assessment, [laugh] I would say. So, I'd say my life as an analyst was a lot of lengthy conversations. I guess a little bit of the secret behind analyst inquiry, I mean, a lot of times, they are hour-long conversations, sometimes multiple sets of them. But yeah, it's very true, right?There's a lot of nuance to how you work with technology and how you build things, but then also how you secure it, it's very hard to, kind of, condense that, you know, hours of conversation and many pages of documentation down into some bite-size nuggets that marketers might run with. So, I try to kind of live in that in-between world where I can kind of explain deep technology problems and business realities, and kind of explain that in more common language to people. Sometimes it's easier said than done when you're speaking it as opposed to writing it. But yeah, that's kind of where I tried to bring my skills and experience.Corey: It's a little counterintuitive to folks coming out from the other side, I suspect. For me, at least the hardest part of getting into the business of cloud cost optimization the way that I do with the Duckbill Group was learning to talk. Where I come from a background of heavy on the engineering and operations side, but being able to talk to business stakeholders who do not particularly care what a Kubernetes might be, is critical. You have to effectively be able to speak to different constituencies, sometimes in the same conversation, without alienating the rest of them. That was the hard part for me.Michael: Yeah, that's absolutely true and I certainly ran into that quite a bit as an enterprise architect at Verizon. There's kind of really need to work to identify, like, what is the business need. And typically, that is talking to the stakeholders, you know, what are they trying to achieve? They might not even know that, right, [laugh] because not everybody is very structured in how they think about the problem you're trying to solve. And then what is their daily workflow?And then you kind of arrive at the technology. I'd say, a common pitfall for anybody, right, Whether you're an engineer or a security practitioner is to kind of start with the technology or the solution and then try to force that on people, right? “Here's your solution to the problem that maybe you didn't know you had.” [laugh]. It kind of should work in reverse, right? What's the actual business need? What's your workflow? And what's the appropriate technology for that, right?Whether it's right-sizing the infrastructure or a particular type of functionality or protection, all those things, right? So, very similar kind of way of approaching the problem. It's just what you're trying to solve but [laugh] I've definitely seen that, kind of, Kubernetes is all the rage, right, or service mesh. Like, everybody needs to start deploying Istio, and you really should be asking the question—Corey: Oh, it's all resume-driven development.Michael: Yep, exactly. Yeah. It's kind of the new kid on the block, right? Let's push out this cool new technology and then problems be damned, right?Corey: I'm only half-kidding on that. I've talked to folks who are not running those types of things and they said that it is a bit of a drag on their being able to attract talent.Michael: Yeah, it's—you know, I mean, it's newer technologies, right, so it can be hard to find them, right, kind of unicorn status. I used to talk quite a bit in advisory calls to find DevOps practitioners that were kind of full-stack. That's tricky.Corey: I always wonder if it's possible to find them, on some level.Michael: Yeah. And it's like, well, can you find them and then when you do find them, can you afford them?Corey: Oh, yeah. What I'm seeing in these other direction, though, is people who are making, you know, sensible technology choices where you actually understand what lives were without turning it into a murder mystery where you need to hire a private investigator to track it down. Those are the companies that are having trouble hiring because it seems that an awful lot of the talent, or at least a significant subset of it, want to have the latest and greatest technologies on their resume on their next stop. Which, I'm not saying they're wrong for doing that, but it is a strange outcome that I wasn't quite predicting.Michael: Yeah. No, it is very true, I definitely see that quite a bit in tech sector. I've run into it myself, even with the amount of experience I have and skills. Yeah, companies sometimes get in a mode where they're looking for very specific skills, potentially even products or technologies, right? And that's not always the best way to go about it.If you understand concepts, right, with technology and systems engineering, that should translate, right? So, it's kind of learning the new syntax, or semantics, working with a framework or a platform or a piece of technology.Corey: One of the reasons that I started the security side of what I do on the newsletter piece, and it caught some people by surprise, but the reason I did it was because I have always found that, more or less, security and cost are closely aligned spiritually, if nothing else. They're reactive problems and they don't, in the general sense, get companies one iota closer to the business outcome they're chasing, but it's something you have to do, like buying fire insurance for the building. You can spend infinite money on those things, but it doesn't advance. It's all on the defensive, reactive side. And you tend to care about these things a lot right after you failed to care about them sufficiently. Does that track at all from your experience?Michael: Yeah. Yeah, absolutely. I'm just kind of flashing back to some war stories at Verizon, right? It was… I'd say very common that, once you've kind of addressed, well, these are the business problems we want to solve for and we're off to the races, right, we're going to build this cool thing. And then you deploy it, right [laugh], and then you forgot to account for backup, right? What's your disaster recovery plan? Do you have logging in place? Are you monitoring the thing effectively? Are your access controls accounted for?All those, kind of, tangential processes, but super-critical, right, when you think about, kind of, production systems, like, they have to be in place. So, it's absolutely true, right, and it's kind of definitely for just general availability, you need to be thinking about these things. And yeah, they almost always translate to that security piece of it as well, right, particularly with all the regulations that organizations are impacted with today. You really need to be thinking about, kind of, all these pieces of the puzzle, not just hey, let's build this thing and get it on running infrastructure and we're done with our work.Corey: A question that I've got for you—because I'm seeing a very definite pattern emerging tied to the overall macro environment, now, where after a ten-year bull run, suddenly a bunch of companies are discovering, holy crap, money means something again, where instead of being able to go out and gets infinite money, more or less, to throw at an AWS bill, suddenly, oh, that's a big number, and we have no idea what's in it. We should care about that. So, almost overnight, we've seen people suddenly caring about their bill. How are you seeing security over the past year or so? Has there been a similar awareness around that or has that not really been tied to the overall macro-cycle?Michael: Very good question, yeah. So unfortunately, security's often an afterthought, right, just like, kind of those things that support availability—probably going to get a little bit better ranking because it's going to support your customers and employees, so you're going to get budget and headcount to support that. Security, usually in the pecking order, is below that, right, which is unfortunate because [laugh] there can be severe repercussions with that, such as privacy impacts, or data breach, right, lost revenue, all kinds of things. But yeah, typically, security has been undercut, right? You're always seeking headcount, you need more budget.So, security teams tend to look to delegate security process out, right? So, you kind of see a lot of DevOps programs, like, can we empower engineers to run some of these processes and tooling, and then security, kind of, becomes the overseer. So, we see a lot of that where can we kind of have people satisfy some of these pieces. But then with respect to, like, security budgets, it is often security tools consolidation because a lot organizations tend to have a lot of things, right? So, security leaders are looking to scale that back, right, so they can work more effectively, but then also cut costs, which is definitely true these days in the current macroeconomic environment.Corey: I'm curious as well, to see what your take is on the interplay between cost and security. And what I mean by that is, I did the numbers once, and if you were to go into an AWS native environment, ignore third-party vendors for a second, just configure all of the AWS security services in your account, so the way that best practices dictate that you should, you're pretty quickly going to end up in a scenario where the cost of that outweighs that of the data breach that you're ostensibly trying to prevent. So—Michael: Yes.Corey: It's an infinite money pit that you can just throw everything into. So, people care about security, but they also care about cost. Plus, let's be very direct here, you can spend all the money on security and still lose. How do companies think about that now?Michael: A lot of leaders will struggle with, are we trying to be compliant or are we trying to be secure? Because those can be very different conversations and solutions to the problem. I mean, ideally, everybody would pursue that perfect model of security, right, enable all the things, but that's not necessarily cost-effective to do that. And so, most organizations and most security teams are going to prioritize their risks, right? So, they'll start to carve out, maybe these are all our internet-facing applications, these are the business-critical ones, so we're going to allocate more security focus to them and security spend, so [maybe we will be turn up 00:13:20] more security services to protect those things and monitor them.Then [laugh], unfortunately, you can end up with a glut of maybe internal applications or non-critical things that just don't get that TLC from security, unfortunately, for security teams, but fortunate for attackers, those things become attack targets, right? So, they don't necessarily care how you've prioritized your controls or your risk. They're going to go for the low-hanging fruit. So, security teams have always struggled with that, but it's very true. Like, in a cloud environment like AWS, yeah, if you start turning everything up, be prepared for a very, very costly cloud expense bill.Corey: Yeah, in my spare time, I'm working on a project that I was originally going to open-source, but I realized if I did it, it would cause nothing but pain and drama for everyone, of enabling a whole bunch of AWS misconfiguration options, given a set of arbitrary credentials, that just effectively try to get the high score on the bill. And it turned out that my early tests were way more successful than anticipated, and instead, I'm just basically treating it as a security vulnerability reporting exercise, just because people don't think about this in quite the same way. And again, it's not that these tools are necessarily overpriced; it's not that they aren't delivering value. It's that in many cases, it is unexpectedly expensive when they bill across dimensions that people are not aware of. And it's one of those everyone's aware of that trap the second time type of situations.It's a hard problem. And I don't know that there's a great way to answer it. I don't think that AWS is doing anything untoward here; I don't think that they're being intentionally malicious around these things, but it's very vast, very complex, and nobody sees all of it.Michael: Very good point, yes. Kind of, cloud complexity and ephemeral nature of cloud resources, but also the cost, right? Like, AWS isn't in the business of providing free service, right? Really, no cloud provider is. They are a business, right, so they want to make money on Cloud consumption.And it's interesting, I remember, like, the first time I started exploring Kubernetes, I did deploy clusters in cloud providers, so you can kind of tinker and see how these things work, right, and they give you some free credits, [a month of credit 00:15:30], to kind of work with this stuff. And, you know, if you spin up a [laugh] Kubernetes cluster with very bare bones, you're going to chew through that probably within a day, right? There's a lot of services in it. And that's even with defaults, which includes things like minimal, if anything, with respect to logging. Which is a problem, right, because then you're going to miss general troubleshooting events, but also actual security events.So, it's not necessarily something that AWS could solve for by turning everything up, right, because they are going to start giving away services. Although I'm starting to see some tide shifts with respect to cybersecurity. The Biden administration just released their cybersecurity strategy that talks about some of this, right? Like, should cloud providers start assuming more of the responsibility and accountability, potentially just turning up logging services? Like, why should those be additional cost to customers, right, because that's really critical to even support basic monitoring and security monitoring so you can report incidents and breaches.Corey: When you look across what customers are doing, you have a different problem than I do. I go in and I say, “Oh, I fixed the horrifying AWS bill.” And then I stop talking and I wait. Because if people [unintelligible 00:16:44] to that, “Ooh, that's a problem for us,” great. We're having a conversation.If they don't, then there's no opportunity for my consulting over in that part of the world. I don't have to sit down and explain to people why their bill is too high or why they wouldn't want it to be they intrinsically know and understand it or they're honestly not fit to be in business if they can't make a strategic evaluation of whether or not their bill is too high for what they're doing. Security is very different, especially given how vast it is and how unbounded the problem space is, relatively speaking. You have to first educate customers in some ways before attempting to sell them something. How do you do that without, I guess, drifting into the world of FUD where, “Here are all the terrible things that could happen. The solution is to pay me.” Which in many cases is honest, but people have an aversion to it.Michael: Yeah. So, that's how I feel [laugh] a lot of my days here at Sysdig. So, I do try to explain, kind of, these problems in general terms as opposed to just how Sysdig can help you solve for it. But you know, in reality, it is larger strategic challenges, right, there's not necessarily going to be one tool that's going to solve all your problems, the silver bullet, right, it's always true. Yes, Sysdig has a platform that can address a lot of cloud security-type issues, like over-permissioning or telling you what are the actual exploitable workloads in your environment, but that's not necessarily going to help you with, you know, if you have a regulator breathing down your neck and wants to know about an incident, how do you actually relay that information to them, right?It's really just going to help surface event data, stitch things together, that now you have to carry that over to that person or figure out within your organization who's handling that. So, there is kind of this larger piece of, you know, governance risk and compliance, and security tooling helps inform a lot of that, but yeah, every organization is, kind of, have to answer to [laugh] those authorities, often within their own organization, but it could also be government authorities.Corey: Part of the challenge as well is that there's—part of it is tooling, absolutely, but an awful lot of it is a people problem where you have these companies in the security space talking about a variety of advanced threats, of deeply sophisticated attackers that are doing incredibly arcane stuff, and then you have the CEO yelling about what they're doing on a phone call in the airport lounge and their password—which is ‘kitty' by the way—is on a Post-It note on their laptop for everyone to see. It feels like it's one of those, get the basic stuff taken care of first, before going down the path to increasingly arcane attacks. There's an awful lot of vectors to wind up attacking an infrastructure, but so much of what we see from data breaches is simply people not securing S3 buckets, as a common example. It's one of those crawl, walk, run types of stories. For what you do, is there a certain level of sophistication that companies need to get to before what you offer starts to bear fruit?Michael: Very good question, right, and I'd start with… right, there's certainly an element of truth that we're lagging behind on some of the security basics, right, or good security hygiene. But it's not as simple as, like, well, you picked a bad password or you left the port exposed, you know? I think certainly security practitioners know this, I'd even put forth that a lot of engineers know it, particularly if they're been trained more recently. There's been a lot of work to promote security awareness, so we know that we should provide IDs and passwords of sufficient strength, don't expose things you shouldn't be doing. But what tends to happen is, like, as you build monitoring systems, they're just extremely complex and distributed.Not to go down the weeds with app designs, with microservices architecture patterns, and containerized architectures, but that is what happens, right, because the days of building some heavyweight system in the confines of a data center in your organization, those things still do happen, but that's not typically how new systems are being architected. So, a lot of the old problems still linger, there's just many more instances of it and it's highly distributed. So it, kind of, the—the problem becomes very amplified very quickly.Corey: That's, I think, on some level, part of the challenge. It's worse in some ways that even the monitoring and observability space where, “All right, we have 15 tools that we're using right now. Why should we talk to yours?” And the answer is often, “Because we want to be number 16.” It's one of those stories where it winds up just adding incremental cost. And by cost, I don't just mean money; I mean complexity on top of these things. So, you folks are, of course, sponsoring this episode, so the least I can do is ask you, where do you folks start and stop? Sysdig: you do a lot of stuff. What's the sweet spot?Michael: Yeah, I mean, there's a few, right, because it is a larger platform. So, I often talk in terms of full lifecycle security, right? And a lot of organizations will split their approaches. We'll talk about shift left, which is really, let's focus very heavily on secure design, let's test all the code and all the artifacts prior to delivering that thing, try to knock out all quality issues, right, for kind of that general IT, but also security problems, which really should be tracked as quality issues, but including those things like vulnerabilities and misconfigs. So, Sysdig absolutely provides that capability that to satisfy that shift left approach.And Sysdig also focuses very heavily on runtime security or the shield right side of the equation. And that's, you know, give me those capabilities that allow me to monitor all types of workloads, whether they're virtual machines, or containers, serverless abstractions like Fargate because I need to know what's going on everywhere. In the event that there is a potential security incident or breach, I need all that information so I can actually know what happened or report that to a regulatory authority.And that's easier said than done, right? Because when you think about containerized environments, they are very ephemeral. A container might spin up a tear down within minutes, right, and if you're not thinking about your forensics and incident response processes, that data is going to be lost [unintelligible 00:23:10] [laugh]. You're kind of shooting yourself in the foot that way. So yeah, Sysdig kind of provides that platform to give you that full range of capabilities throughout the lifecycle.Corey: I think that that is something that is not fully understood in a lot of cases. I remember a very early Sysdig, I don't know if it was a demo or what exactly it was, I remember was the old Heavybit space in San Francisco, where they came out, it was, I believe, based on an open-source project and it was still taking the perspective, isn't this neat? It gives you really in-depth insight into almost a system-call level of what it is the system is doing. “Cool. So, what's the value proposition for this?”It's like, “Well, step one, be an incredibly gifted engineer when it comes to systems internals.” It's like, “Okay, I'll be back in five years. What's step two?” It's like, “We'll figure it out then.” Now, the story has gone up the stack. It originally felt a little bit like it was a solution in search of a problem. Now, I think you have found that problem, you have clearly hit product-market fit. I see you folks in the wild in many of my customer engagements. You are doing something very right. But it was neat watching, like, it's almost for me, I turned around, took my eye off the ball for a few seconds and it went from, “We have no idea of what we're doing” to, “We know exactly what we're doing.” Nice work.Michael: Yeah. Yeah. Thanks, Corey. Yeah, and there's quite a history with Sysdig in the open-source community. So, one of our co-founders, Loris Degioanni, was one of the creators of Wireshark, which some of your listeners may be familiar with.So, Wireshark was a great network traffic inspection and observability tool. It certainly could be used by, you know, just engineers, but also security practitioners. So, I actually used it quite a bit in my days when I would do pen tests. So, a lot of that design philosophy carried over to the Sysdig open source. So, you're absolutely correct.Sysdig open source is all about gathering that sys-call data on what is happening at that low level. But it's just one piece of the puzzle, exactly as you described. The other big piece of open-source that Sysdig does provide is Falco, which is kind of a threat detection and response engine that can act on all of those signals to tell you, well, what is actually happening is this potentially a malicious event? Is somebody trying to compromise the container runtime? Are they trying to launch a suspicious process? So that those pieces are there under the hood, right, and then Sysdig Secure is, kind of, the larger platform of capabilities that provide a lot of the workflow, nice visualizations, all those things you kind of need to operate at scale when you're supporting your systems and security.Corey: One thing that I do find somewhat interesting is there's always an evolution as companies wind up stumbling through the product lifecycle, where originally it starts off as we have an idea around one specific thing. And that's great. And for you folks, it feels like it was security. Then it started changing a little bit, where okay, now we're going to start doing different things. And I am very happy with the fact right now that when I look at your site, you have two offerings and not two dozen, like a number of other companies tend to. You do Sysdig Secure, which is around the security side of the world, and Sysdig Monitor, which is around the observability side of the world. How did that come to be?Michael: Yeah, it's a really good point, right, and it's kind of in the vendor space [laugh], there's also, like, chasing the acronyms. And [audio break 00:26:41] full disclosure, we are guilty of that at times, right, because sometimes practitioners and buyers seek those things. So, you have to kind of say, yeah, we checked that box for CSPM or CWPP. But yeah, it's kind of talking more generally to organizations and how they operate their businesses, like, that's more well-known constructs, right? I need to monitor this thing or I need to get some security. So, lumping into those buckets helps that way, right, and then you turn on those capabilities you need to support your environment, right?Because you might not be going full-bore into a containerized environment, and maybe you're focusing specifically on the runtime pieces and you're going to, kind of, circle back on security testing in your build pipeline. So, you're only going to use some of those features at the moment. So, it is kind of that platform approach to addressing that problem.Corey: Oh, I would agree. I think that one of the challenges I still have around the observability space—which let's remind people, is hipster monitoring; I don't care what other people say. That's what it is—is that it is depressingly tied to a bunch of other things. To this day, the only place to get a holistic view of everything in your AWS account in every region is the bill. That somehow has become an observability tool. And that's ridiculous.On the other side of it, I have had several engagements that inadvertently went from, “We're going to help optimize your cost,” to, “Yay. We found security incidents.” I don't love a lot of these crossover episodes we wind up seeing, but it is the nature of reality where security, observability, and yes, costs all seem to tie together to some sort of unholy triumvirate. So, I guess the big question is when does Sysdig launch a cost product?Michael: Well, we do have one [laugh], specifically for—Corey: [laugh]. Oh, events once again outpace me.Michael: [laugh]. But yeah, I mean, you touched on this a few times in our discussion today, right? There's heavy intersections, right, and the telemetry you need to gather, right, or the log data you need to gather to inform monitoring use cases or security use cases, a lot of the times that telemetry is the same set of data, it's just you're using it for different purposes. So, we actually see this quite commonly where Sysdig customers might pursue, Monitor or Secure, and then they actually find that there's a lot of value-add to look at the other pieces.And it goes both ways, right? They might start with the security use cases and then they find, well, we've over-allocated on our container environments and we're over-provisioning in Kubernetes resources, so all right, that's cool. We can actually reduce costs that could help create more funding to secure more hosts or more workloads in an environment, right? So it's, kind of, show me the things I'm doing wrong on this side of the equation, whether that's general IT security problems and then benefit the other. And yeah, typically we find that because things are so complex, yeah, you're over-permissioning you're over-allocating, it's just very common, rights? Kubernetes, as amazing as it can be or is, it's really difficult to operate that in practice, right? Things can go off the rails very, very quickly.Corey: I really want to thank you for taking time to speak about how you see the industry and the world. If people want to learn more, where's the best place for them to find you?Michael: Yes, thanks, Corey. It's really been great to be here and talk with you about these topics. So, for me personally, you know, I try to visit LinkedIn pretty regularly. Probably not daily but, you know, at least once a week, so please, by all means, if you ever have questions, do contact me. I love talking about this stuff.But then also on Sysdig, sysdig.com, I do author content on there. I speak regularly in all types of event formats. So yeah, you'll find me out there. I have a pretty unique last name. And yeah, that's kind of it. That's the, I'd say the main sources for me at the moment. Don't fall for the other Isbitski; that's actually my brother, who does work for AWS.Corey: [laugh]. That's okay. There's no accounting for family, sometimes.Michael: [laugh].Corey: I kid, I kid. Okay, great company. Great work. Thank you so much for your time. I appreciate it.Michael: Thank you, Corey.Corey: Mike Isbitski, Director of Cybersecurity Strategy at Sysdig. I'm Cloud Economist Corey Quinn and this has been a promoted guest episode brought to us by our friends at Sysdig. If you've enjoyed this podcast, please leave a five-star review on your podcast platform of choice, whereas if you've hated this podcast, please leave a five-star review on your podcast platform of choice along with an angry, insulting comment from your place, which is no doubt expensive, opaque, and insecure, hitting all three points of that triumvirate.Corey: If your AWS bill keeps rising and your blood pressure is doing the same, then you need The Duckbill Group. We help companies fix their AWS bill by making it smaller and less horrifying. The Duckbill Group works for you, not AWS. We tailor recommendations to your business and we get to the point. Visit duckbillgroup.com to get started.

Super Serious 616
E199 - The newest Avengers are... a trio of supervillains? How does this make any sense?!? (Avengers #16 Part 1) -- May 1965

Super Serious 616

Play Episode Listen Later Apr 19, 2023 14:06


Next week is our 200th episode! It was fortunate timing that it ended up landing right on our episodes about Avengers #16, which was one of the most important issues of the era. If you are enjoying What If Marvel was Real?, now would be a great time to spread the word! Thanks for your help in getting our little show out there, and for all the listeners who have been here from the beginning.In this episode:Mike and Ed discuss the surprise announcement that Hawkeye, the supervillain, will be joining the Avengers as a new member. The Federal Security Agency has given Hawkeye a thumbs up, but how is that possible? What do they know that we do not? Do we need to talk conspiracies again? The rumors are that Captain America and Thor are out of the organization. If true, we will only be left with heroes with technological powers - have the people behind the technology (and masks) been replaced? Is this the end of an era?Behind the issue:This is one of the key issues of the mid-60s. The Avengers were originally Marvel's answer to the Justice League, whereby the publisher put all the heroes from different titles into one book to get the readers excited and turning over their hard-earned cash for tales of camaraderie and adventure. But the individual hero titles continued, and Stan had to keep his developing Marvel universe consistent. He had to juggle the storylines in, say, the individual title Tales of Suspense with what was happening in the team title Avengers. If Thor had been called away to Asgard, then how would be be around for an Avengers adventure that same month? Making it all make sense every month was challenging for Stan, and he wanted a solution.The answer was to take most of the heroes with their own titles off the team. He kept Captain America, and maybe rationalized it by knowing that the Captain America stand-alone stories could be set back in World War II whenever he wanted them to be. Then he filled in the rest of the team with supporting characters from other titles - characters who did not have their own books (and would not get their own books for many years, i.e. Hawkeye did not get his first solo title until 1983; Scarlet Witch, with Vision, until 1982; and Quicksilver until 1997).In this issue:The issue opens with the Avengers once again emerging victorious over the Masters of Evil in New York, with Captain America defeating Baron Zemo in South America. It continues with Iron Man, Giant-Man, and the Wasp in New York having a team meeting and deciding to take a break from being on the team. At the same time they are having the meeting, Hawkeye breaks into their headquarters and asks to join the Avengers. His beloved Black Widow has been murdered by her employers behind the iron curtain, and he has had a change of heart on his line of work. The team decide to take him up on the offer, and on top of that, seek out new potential teammates, with the papers reporting this initiative. Scarlet Witch and Quicksilver decide to apply to join the team, and they are admitted to the ranks as well. By the time Captain America returns, the team has been completed reconstituted, with Iron Man, Giant-Man, and the Wasp out, and Hawkeye, Quicksilver, and Scarlet Witch in as their replacements.Assumed before the next episode:People are excited, and a little nervous, that the Avengers roster has been changed so completely.This episode takes place:After the announcement that Hawkeye will be on the team, but before Captain America returns from South America.Full transcript:Edward: Mike, I told you that Hawkeye was a superhero. I told you. I told you. You were like, oh no, he's not that good. He can't even fight anybody just as Arrows. Oh, go back to the 14th century. But no. Now Hawkeye is an Avenger. Mike. He's an avenger.Michael: Yeah. I guess the Avengers, they already had a man who's basically a one man rocket and can shoot energy from his fists as an Iron man. They needed to get somebody who could. Arrows on the team.Edward: Hey. The last time Hawkeye faced Iron Man, first of all, last time he faced Iron Man, he was a villain. We should talk about that. But when he did, yes, he defeated Iron Man, right? He blasted him with his energy discharge arrow and took him out. So, hey, this guy is versatile. We've had this debate. We don't need to debate it again. I think you are against Team Hawkeye. I am on Team Hawkeye. I think that it's absolutely fine from a power perspective that he's on the team. I'm not sure from a, ethics perspective, he's the red venture.Michael: Well, okay, let's break into, those two points then. So from a powerless perspective there must be something to him that he brings into the team, right? I can't imagine that it's solely just really good aim. There must be some other, maybe he's got some other ability that like he's, um, some kind of likeEdward: oh, maybe his really, maybe his really good eyesight. HawkeyeMichael: In the name, I mean alone, but he's got, there's some kind of, maybe, I'm just thinking maybe this is a signal that the Avengers are going from less, overt action to be more in the shadows.Edward: And nothing says sneaky like a purple costume carrying a bow and arrow.Michael: It's a dark purple ed. It's a dark, dark purple. No, but there must be something to it. Like he did take on Iron Man. He did seem to defeat him. So in a skills-based contest and maybe he's. Like you notice that Captain America wasn't at the press conference when they announced Hawkeye, so maybe he's a replacement for Captain America's, who's also similarly strategic and stealth based in a lot ways.Edward: There you go. There you go. Cause the rumors are right now that Captain America and Thor are being replaced and Hawkeye is the first edition to the team, but there will be,Michael: and your second point was the ethics. It does strike me as being a little odd that there's a guy who's worked with a known terrorist. The Black Widow. Correct. A Russian agent and he's fought Iron Man a few times. And, I would imagine in the course, Committed some crimes may, maybe he did, maybe technically he didn't commit any crime.He's justEdward: He did. No, I just did. I think they were doing something robbed. They were robbing Stark Corp or something. Yeah. They kidnapping somebody he was doing bad stuff.Michael: They kidnapped, they kidnap people. Yeah. Yeah. That seems a bit much to sweep under the rug.Edward: That's right. Where I come from, kidnapping is a crime, Mike. It's a crime. But come from planet, but not according to the federal security Agency. The federal security agency has approved Hawkeye as a member of the Avengers, says that his record is clean, that he is totally allowed to be on the team.Michael: Well, I know when I became a lawyer there is a requirement of good character to become a lawyer and. I think that there's a lot of lawyers, soEdward: I think the bar should be higher for the Avengers. Shouldn't the bar be higher than the lawyers?Michael: I think it should be. I think it should be. It should be higher than the bar for lawyers. The bar for superhero should be much higher and it turns out that it isn't. And let's be honest, the Avengers are the super team that people are in, are interested in, and it that are called in as the heavy hitters. So this seems like. Quite a promotion for somebody who, as you say, committed the crime of kidnappingEdward: That's interesting. Let's go back and talk about your issue with, Hey, lawyers have a high bar. I think part of the reason why we can hold lawyers to a high bar is that the supply of lawyers is really high. We're graduating more lawyers every year, and if there's an unethical lawyer, we can say, no thank you. We don't need you. We can replace you with an ethical lawyer. I wonder if the problem is, People who are powerful enough, superheroes who are powerful, super people who are powerful enough to be Avengers. There's not an excess supply. There's a handful of these people. Mm-hmm. There's like a few dozen maybe on the planet. And so if you're looking to augment that team and your bar is high from a power perspective, maybe you have to bend a little bit on the ethics perspective.Michael: Or maybe, if you believe in rehabilitation, which I do, maybe there's a steep rehabilitation curve? Because as you say, demand exceeds supply. And so if we need to have, Superpowered or super skilled people either we're willing to turn a blind eye or we're willing to go through the process that hopefully allows him to achieve rehabilitation. So behind the scenes there's been this sped up process. Yeah. Because we need to have this person. I know what you're saying. It does seem a little fu butEdward: it does. I'm stretching a little bit, trying to make sense of the fact that we have a known super villain on the team. And not just on the team, but specifically signed off by the federal government, the federal security agency has come on and said, Hey, this guy is clean. He's totally, totally legit. Now, and maybe the other possibilities that maybe the whole villain thing that Hawkeye was doing before was a misunderstanding, like the, the Avengers declared martial law on America. Turns out it was a mistake. Right? It wasn't actually them maybe and we're okay with that because Avengers do good, Avengers do. We'd say, oh, the bad was a mistake. We're all good. And Hawkeye just didn't do the good part at the beginning. He was just doing much of bad, but then like, oh, nope, we are okay with it. It was a, it was kind of a mistake. It was a misunderstanding. He's actually a good guy and maybe we just have to accept that.Michael: I guess, and the fact that it's Iron Man who he's fought, who's come forward and vouched for him, must mean there's something to the idea thereEdward: that's assuming Iron. Man is Iron Man.Michael: I know it's the Iron Man with whomever that person is has come forward and voast for him? For, for Hawkeye, andEdward: well, no, no. Let's say a Iron Man has come forward and Vos for Hawkeye. Yeah. But that's a whole other point. We've talked about this conspiracy. Do we know that the Iron Man inside the Iron Man suit is the same as the Iron Man who was in the Iron Man suit fighting Hawkeye. Maybe the Iron Man inside the suit. The individual inside the suit has been replaced and now he's like, I was an enemy with the old guy in the suit. Let's bring on some more of the people who are also his enemy onto the main team.Michael: So a hostile takeover, Eddie, like you got. This Iron Man. That's not real. Who's recruiting a villain and who's left on the team? Who are the other people on the team? Ed?Edward: Well, we know that I think giant man in the WASP are still people on the team, and so, hey, we, know that giant man in the wasps, their powers come from technology, right? We know this now too, right? There's some sort of helmet or pills or something they take and they wear masks. We don't know who they are. Maybe they've been replaced at the same.Michael: It's Wild Day, so the three members of the team of the Avengers, who are technology based, Iron Man, giant men in the Wasp are still on there and they could be swapped in. And interchangeable. For all we know. Thor isn't exactly interchangeable.Edward: That's right too. So the two people that are not, that looks like they're being replaced are Captain American Thor and Thor is, that's right. Clear. Like whatever. Thor is magical, powered, mutant. We don't know exactly what he is. We know that he is not an armored suit. He's not taking a pill. And turning to Thor and Captain America we know is some experiment from like the 1940s during World War ii, who is Un aging and like super strong. And he's a super powerful individual. He's physically fit and he's not replaceable either. He's not like, you can just put someone else, put the,Michael: there's footage of him going back to the forties as well, so maybe hard to just replace him. Whereas you have the, you're right, you have the only three members of the Avengers left are one second, easily be swapped out, and now they're. Pac a villain, or at least a criminal.Edward: I think somebody should be taking photos of the lower half of Giant Man's face and matching that up to previous photos. I guess you could still replace him with someone who's lower Jaw looks the same, but maybe they didn't go to that much trouble. I think someone should at least investigate.Michael: Or get his dental records, or photos to get a sense of his teeth and then compare them to old photos and say, aha, aha, I can see that that front tooth is shifted over quite a bit. That's not the same giant man.Edward: He's like, but I was punched in the face. I'm an avenger. I can punch in the face a lot.Michael: Uh, maybe wouldn't be the best one. But the nose, even like noses are pretty distinctive. Or even ears that they pot. Well, I don't think ears pot though, butEdward: his ears are covered. We don't, we don't know what his ears look like,Michael: but this all goes through our fundamental problem is that we, as a public and as the fifth, the state, have a hard time, Getting a sense of who these people are or possibly being fooled because they wear masks. And I guess, if we see that the Avengers as basically a very public facing, paramilitary organization that's to some degree manage or governed by the government say the Federal security agency in this case, then I guess there must be some safeguards. I good, good guess, but it's hard to say.Edward: And even if there are, it feels like, it's not the first time that you can imagine some corruption within the government, right? Maybe it's not even, a giant corrupt thing that we're talking about, but maybe that giant man in the wasp, our agents of the government, Iron Man is an agent of the government and somebody in charge. Whoever we don't know who that is. Someone in charge decides to bring on Hawkeye, and let's say all five members of the team are. Forget it. We don't want this guy on the team and the government guy's like, no, no, no, no, no. We've done the checkup. He's totally fine. He's totally legit. But they're like, no, we, we all quit. And so Captain American Thor are gone. You can't replace them, but you're like, oh, well hey, you three, you can't quit. You can quit if you want, but whatever. Tom Jones and Bob Smith can quit, but a giant man and the Iron Man in the was, they don't quit. They just get replace.Michael: Yeah, this deserves investigation. This deserves further inquiry. There's too many moving parts of the story to just let it sit. It's easy to be distracted by a new member of the adventures for the public, it's the first new member that they've added since they formed,Edward: no, no, no. That's not true. That's not Captain America came on. They, and he joined the team. Wonderman came on and he joined the team. Now, Wonderman died almost before we knew he was on the team. But he was an official Avenger for Okay. Some period of time. So this is the third new member of the team.Michael: Okay. It's still relatively unique though, let's just say that it's a big deal. Like Captain America is a new Yeah, it's a big deal. So it's, but it's distractingly. Interesting. And so other people, other journalists, and if I don't think we would consider ourselves journalists, but maybe we should, in this instance, should be asking these tough questions. And then I would think if they are truly a paramilitary organization, there is an interest, a public interest in perhaps knowing their identities in the same way that you would of any kind of, Government agents, unless they're spies, which the adventures aren't.Edward: Okay. Can we talk a little bit about speculation? We've done this conspiracy stuff, but now we have so it's true the Captain American Thor are off the team. I think your argument is that Hawkeye kind of replaces Captain America and I can buy that, right? Like they're both extremely talented individuals in some way, shape, or form. Both of them have projectiles that they incorporate one arrow and one a shield. I would argue arrows. More effective than shields start in terms of projectiles. But so that leads Thor. How do you replace an as guardian thunder God?Michael: Maybe with a Hulk. I don't know. Like, I mean, like what?Edward: Yeah, that went well last time.Michael: Maybe. The Thing, maybe.Edward: Oh, maybe The. Thing. Oh my gosh. That's a great call. Great call. Maybe it's time to shift things up.Michael: Yeah, I mean like maybe he's tired of being I wouldn't say that the fantastic four second tier, cause they aren't, but they do serve a different niche right, than the Avengers. And maybe that's true. Maybe Ben Grimm who was in the military. His interest might align better with a paramilitary organization rather than a more adventuring kind of organization. Fantastic.Edward: That's a great idea. Now, here's another theory is that Hawkeye was a villain that they got over to the hero side. Why don't we look at the list of villains out there? Radioactive man. Radioactive man from China. They decide to he's gonna defect and join America and join the Avengers. Because I would argue radioactive then wasn't evil. He was just serving the wrong master. And people have defected from China to America all the time.Michael: I mean, it'd be hard to get notice to him over in China, but Sure. He does have a skillset. He is extremely powerful. Similar to, I don't think he's the same strength level as Thor, butEdward: hasn't he battled Thor? Isn't Thor and radioactive man, aren't they arch.Michael: It's hard to tell. How many battles do you have to be an Archie enemy? I think you need a few, but,Edward: Just a regular enemy.Michael: Yeah, he's an enemy. Well, how about, okay, there's two. I'd say if you wanna go straight on, as guardian to as guardian, it would be the executioner. Executioner, yeah. Or Loki. Are the, oh Loki. If you could rehabilitate in the way that they rehabilitated, Hawkeye presumably, but I'd imagine rehabilitating an ancient immortal being that it might be a little tough. Tougher it. A little tougher to serve the interests of America or the world.Edward: No. You've been focus, we've been focused on like strength though too. Mr. Hyde is another strength strong guy. Yeah. Right. Maybe Mr. Hyde. But I wonder Thor is more than just a strong guy. He's more than. Pure muscle, the guy can fly. Remember we talked about how fast he can fly across the ocean?Yep. So do we need a guy who can fly? Like how about the wizard? Can we bring the wizard back?Michael: Yeah. But it's not like he's made a couple mistakes. Like you suggested maybe hot guy. He's a career criminal now. He just broke bad. How about, how about that guy with the, the wings from the x.Edward: Oh, angel Fly. Angel could fly Fly Angel. Yeah. Angel. Angel could fly. Yeah. You know, I think the point is it's gonna be hard to replace Thor cuz there's people who are strong that we could find. There are people who can fly. We could find, but trying to find somebody who can do both, that's a pretty unique spot. I think maybe there, there were, they made a mistake to let Thor go.Michael: Like I say, it's a developing story and I'm still distracted by the idea for lack of a better term, a super villain. Hawkeye is now in the Avengers, seems kind of funny. For a couple reasons. And then longstanding Avengers are just, I just disappeared. The only ones that remain are ones who are basically, are suits, where power suits seems kind of strange. Yeah. Yeah. And I wonder what's happening. You know, we gotta get into this.Edward: There's also the point that we, this is all speculation too, because they did not say the Captain American Thor off the team. There was questions asked, and it was all just no comment. No comment, no comment. We're not gonna talk about it. What did he, he said something about the lives of Avengers are private citizens. We can't comment on them. Like, it was a definitely a very sketchy statement of we're not gonna go there.And so, hey, I guess stay tuned is the answer. More to come. More to come. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.superserious616.com

Marketing The Invisible
Create Your Book Without Writing a Word – In Just 7 Minutes with Michael DeLon

Marketing The Invisible

Play Episode Listen Later Mar 22, 2023 5:59


 Discover how can you turn your leads into ever-flowing conversations and into better credibility Assess if you're giving more of who you are to your audience rather than what you do Learn why you should have a clear message before investing so much in your marketing Resources/Links: Want tips on how you can build your credibility with the magic of gifting? Click here: paperbackexpert.com/gifting Summary Do you want to find out how you can write your book without really writing it through your conversations driven by authenticity? Nobody wants to read the usual, so why not serve them up with something new? Adding a personal touch to everything you do, whether it's the way you talk or present yourself, is actually more important than you think. It's what makes people remember you. Michael DeLon is the #1 Amazon Best-Selling Author and America's Foremost Authority on Credibility Marketing. He teaches business owners how to establish credibility and gain more new clients. Dive a little bit deeper into the world of authenticity and personal branding with Michael as he shares how you can write your book without really doing so through your conversations driven by your authentic self and story. Check out these episode highlights: 01:22 - Michael's ideal client: Well, Tom, my ideal client's that business owner who's always thought about writing a book, but never done it. 02:13 - The problem he helps solve: So we've built marketing systems, step-by-step guides, that we give to our clients, and they implement them through our guidance so that they know how to use the book in lead generation, lead conversion, preconditioning, and referrals. 03:12 - The symptoms of the problem: Yeah, having headaches, Tom, because they're banging their head against the wall, right, because they're frustrated with marketing. They're getting leads, but they're not converting those leads into conversations. 03:56 - Clients' common mistakes before consulting Michael: Well, the first one is they're trying to write their book on their own, right? They tried to write. That's not where you're making your best money. The real big one is they don't have a clear message. 05:24 - Michael's Valuable Free Action (VFA): Be personal. And what I mean by that, Tom, is too many people are trying to be what you think your audience wants you to be. And so you're hiding behind suits or letters behind your name. No, no-- be yourself! 06:09 - Michael's Valuable Free Resource (VFR): Want tips on how you can build your credibility with the magic of gifting? Click here: paperbackexpert.com/gifting 07:18 - Q: How can you be guaranteed to make money as an author? A: In 20 seconds use us because when you work with us, I guarantee that you'll double your investment in two years, or I'll give you all your money back because I know our systems and strategies work. Tweetable Takeaways from this Episode: “People are going to buy who you are more than what you do. Be personal in your marketing.” -Michael DeLonClick To Tweet Transcript (Note, this was transcribed using a transcription software and may not reflect the exact words used in the podcast) Tom Poland 00:10 Welcome, everyone, to another edition of Marketing the Invisible. I'm Tom Poland beaming out to you from the Sunshine Coast in Australia, joined today by Michael DeLon. Michael, it's a pleasure to have you here, sir. Good to meet you again. Michael DeLon 00:21 Thank you, Tom. Tom Poland 00:22 But good day from Down Under. A very warm welcome. Michael, remind me, where are you based? Michael DeLon 00:28 I am in the United States, Little Rock, Arkansas. Tom Poland 00:31 Arkansas, it's a wiper down in Australia. Hands across the water! So, well, folks Michael's superpower is he brings you credibility,

Super Serious 616
E192: Superhero branding, branding, and re-branding (Avengers #15) -- April 1965

Super Serious 616

Play Episode Listen Later Mar 1, 2023 17:13


In this episode:Mike and Ed discuss the battle between the Avengers and the Masters of Evil - not to be confused with the Brotherhood of Evil. Ed explains the importance of differentiation in your brand - you don't want to be confused for someone else. Mike wants to know if every superhero also has to be a tailor in their spare time. How many costumes does someone like Spider-Man own? Is his summer costume made with different material than his winter costume? Is the real benefit of being on a super team the laundry services? And why is Giant-Man re-branding yet again? The red and blue suits you, big guy, now stop fiddling with it and just embrace the fit!Behind the issue:This is the last full issue of this Avengers roster. The next issue, Avengers #16, completely changes the membership (more on that when we cover that issue). This issue ends on a cliffhanger but is wrapped up quickly in the next issue. The battle is used as the driver of why most of the team members decide to leave the organization. Also in this issue, Captain America battles Baron Zemo one-on-one and kills him. But that takes place in a far away country and is, at this point, unknown to the wider public.In this issue:Steve Rogers is contemplating a career change. As he does so, he notices the supervillains the Enchantress and the Executioner drive by, and he chases after them but they get away. Steve changes into his Captain America gear and reports back to the Avengers about the evil duo being in the city. They resolve to deal with them, but before they can do so, Rick Jones is kidnapped right in front of them by henchmen working for Baron Zemo. The Enchantress and the Executioner then break the Black Knight and the Melter out of prison and have them join their team with Zemo, the Masters of Evil. Iron Man and Thor do battle with the Black Knight and the Melter high above the city, while Giant-Man and the Wasp chase after the Enchantress and the Executioner at street level. The villains are ultimately defeated. At the same time, on a separate mission, Captain America locates Rick and frees him, with Zemo dying in the process by his own hand (accidentally).Assumed before the next episode:People are keeping an eye out in the streets for large muscular people in costumes, and then running for their lives so they are not caught up in a super-person battle.This episode takes place:After the Avengers have defeated the Masters of Evil.Full transcript:Edward: All right. That's what I'm talking about, Mike. We got the Avengers fighting a League of Evil super villains in the city. They're back to doing what we pay them to do.Michael: Or somebody pays them to do , but definitelyEdward: our tax dollars at work. Mike, our tax dollars at work,Michael: back to business, doing what we want them to do and not dealing with what was the last thing that they're caught up in, just. Regular,Edward: regular, regular what wasn't like giant man dealing with the mafia, I just felt like know, like get, get, get back on track. We have police that can deal with the regular stuff, but when you have a guy who can melt walls and an enchant who's casting magic spells and an as guardian and executioner, now is the time to step in with superpower people.Michael: That's right if we're anything Ed, we definitely believe in specialties and specialists. and superheroes are by definition specialists in super villains, not just, you know, rescuing cats stuck in trees and, and, uh,Edward: oh, my, I would be mundane, angry if Thor was spending his time getting cats outta trees.like, I feel like, like, not, not a good use of tax dollars. I dunno what we're paying him, but I figure we could pay someone a lot less to get the cats outta the trees. .Michael: But that being said, if my cat got stuck in a tree, I'd rather Thor flew up there than I had to climb a tree and possibly break my neck trying to rescue the bloody cat. But anyways,Edward: I, okay. Like you are not specialized in getting cats outta trees, that is not your specialty either. You stick to the law. Thor sticks to the super villains, and we can get the firefighters to get the cats out of the trees.Michael: All right. I think we've settled on it, on what should happen, certainly with cats and trees, but also with superheroes addressing super villains and so, It's back to business as usual, not great that we had to have them as, you know, having evil super villains, the masters of evil coming back and battling the Avengers, but at least, yeah, fine. The Avengers are tackling this discreet issue.Edward: Let's not even talk about the fact they're called the Masters of Evil. Again, we have the Brotherhood of Evil Mutants, we have the Masters of Evil, we have the frightful four. Like these guys are just throwing themselves out there as being, I am not to be trusted.Michael: I know. Bless. I don't know. It's like good and evil are just, there's no like room for gray in here. Maybe there's . There's no misunderstanding.Edward: The masters of Gray we're the brotherhood of ambiguity, .Michael: How about misunderstood, tough childhood and trying to work through it. People together in a union, fighting for own version of justiceEdward: I will say as a marketing guy the bigger problem is, it's just confusing because right, there's the brotherhood of evil, but, and there's the masters of evil, like, I think. The evil is the key word in both those brands and it's easy to confuse them. Mm-hmm. So to be clear, the masters of evil who fought the Avengers this week there was the melter who could melt metal, not magni, who could move metal. Totally different people, unrelated, different teams, different names, but the same team name. Using that evil.Michael: There's some overlap there I guess, but I think they maybe, well you gotta wonder why they haven't consulted with, an agency about branding, which would make sense.Edward: So the key thing on branding is, number one is be descriptive. And I guess they're being descriptive. We are evil, mean people. And they've handled that part of it. But you also need to differentiate yourself. The other people who are doing similar work. And so if there's two teams of evil people doing evil super stuff, you just can't, you need to find a new name for yourself. And Frightful four does it, right? Frightful four does not use the evil name. They went to their local Theora and they've, looked up evil and they're like, you know what else is similar to evil is frightful. How about frightful instead of evil? And they're like, let's go with it. And there's no confusion there. But I think Masters of Evil and Brotherhood of Evil, to me, those are too close. And one of them should re. .Michael: That leads to the next question. We talked about lawyers might specialize in super powered people and insurance might be responsive to it. I wonder if there's any, well you would know, are there any agencies that deal with this kind of stuff?Edward: I don't think it's, the market's not big enough, Mike. The market's not big enough. Hmm. And, and especially if you're dealing with, nobody wants to be the marketing agency to. The criminals and the mafia. There's no mafia doesn't have a marketing agency working for them. They might have marketers as part of their team, but it's not like they need, they don't need them the way they need, lawyers and accountants.Michael: I'm not saying that General Electric is evil or anything, but you know, , they, they, they definitely, and they, they don't practiceEdward: the, the General Electric of Evil .Michael: No, but I mean like, like they're big corporations that, that, actually I don't wanna get sued by General Electric never meant nevermind about that. But, but regardless, I would imagine that there's agencies that would, for the right price would certain. Wanna be engaged by the Masters of Evil to say, let's call yourselves, maybe not the masters of evil, but the master, you know, the brotherhood of people. I don't know. Or something. Brotherhood of people. Some kinda, some kinda like, I said the, brotherhood of evil. Like the idea is like there's some kind of more palatable name that they could have to achieve their goals. I would imagineEdward: they could take the name they have right now, instead of the Masters of Evil, just be like, How about just the masters? The masters, the masters of super, the ma, the masters of powers, take the other characteristics they have other than evilness and lean. Lean into those. .Michael: Yeah. Like maybe like, they're really smart, I don't think if they're getting in fights with the Avengers, they need people to tell them that they're the antagonist in this dispute. Cuz the Avengers have clearly occupied the superhero world. Why don't you just call them some, call themselves something else? Like the masters or the, uh, the terrifics or something. It's the positive. Be positive by yourself, the public.Edward: Take the Avengers name and play that. Like, they can be the Avengers, like they can, they're the anti Avengers and the anti Avengers. You could define yourselves as being the opposite of your competitor.Michael: And leave it open as to whether they're in the wrong or not, that's what I find so confusing about the branding of automatically saying, we are definitely in the wrong, we are evil people. Evil, evil, evil. Or we are frightful, terrible, terrible people, , we just call themselves the amazing four, let people find out that they're bad. ,Edward: surprise, also evil.Michael: Surprised I was evil. But you know, we kind of had you there. You bought our action figures, because we're the amazing four hey Rob banks and try to destroy nuclear powered, power stations. But anyways. Mm-hmm. we're the amazings,Edward: I think the part of the has become is we don't see a lot of rebranding we've seen groupings of superheroes that come together and created a new brand, but the Avengers haven't decided, oh, we're gonna change our name. Or the Fantastic Four haven't been like, you know what? We've, we totally made a mistake. There is a possibility we could add a fifth member . Um, we need a new name. Um, yeah. It seems like everybody's commit. Well, I guess with one exception, ant Man has rebranded, right? Right. But apart, but apart from Ant Man, everybody's basically stuck with the. Brand since they started. We have any superhero that's switched brands along the way, or super villain for that. .Michael: No. And again, I kind of was being a little tongue in cheek about having agencies that might be involved in branding, but there's probably something to it, if not the name, certainly in the costumes or the outlook or the perspective on, or at least the narrative that they wanna advance. Because we do know that there are some superheroes who are more popular than others, why is Captain America more popular than Spider-Man? It might. because of the name. It might be because he's not covering his whole face. It might be just a costume, but, I'd imagine that there's something there. There's value in being popular and being celebrities as we know the fantastic force. Certainly there's a value in that and a financial benefit to that. So you think it might be worth their time to actually consult? Maybe a lot of them have, certainly the Fantastic four have already consulted with a brand expert and they say, you know, yeah, sure you might be limited in your membership numbers, but you're doing everything else right? You have a very clean, clear lines in your costumes. You're not hiding your face. You don't even have se secret entities. And that's led to them being not only popular, but making money from the whole enterprise. And you gotta wonder, maybe other people would. From it. Or they've already gone through it and just are just trying to play out the whole marketing plan.Edward: We don't know what's going on behind the scenes. We can just see the effects and like I can say there are certain things that are pretty consistent in the world of branding that are important. Mm-hmm. , so things like affiliating your brand with good things. , right? So this is why we run advertisements. That's why beer commercials show people drinking beer and having fun. And now you say, oh, you know what, if I drink beer, maybe I will have fun too. Maybe I will be surrounded by attractive women. And I think there's no difference in superheroes where if Spider-Man is continually getting affiliated with bad things, we start to affiliate Spider-Man as being bad. And if Captain America's affiliated with winning World War ii, which was a pretty good thing that. Leans off onto his brand. So that's number one. Number two is brand longevity matters a lot too. So a brand that's been around for a long time, people tend to like the things that stick around. And part of that's a trust thing because if you have a brand that's brand new, you don't know whether to trust it or not. But if something's been around, like ivory soap has been around for 60 years or something like that, they have a pretty good consistent record on, they're gonna do, they're gonna make you clean. And I think that's part of the reason why Captain America is so loved is he's been around longer time and they, he's consistently stuck on message and delivered that same message over and over and over again, over an extended period of time. And so we can trust him. But Spider-Man, he's like a brand new dude who knows what's what he's gonna do.Michael: Mm-hmm. . Mm-hmm. . Well, yeah. And of course, this is something you have an expertise in about branding. But that leads to the question then. But the question I asked earlier is do you think that most these of these superheroes have consulted with a brand expert?Edward: No. No, of course not. No. they not talking to anybody. They peop, but like, just like most companies don't spend a lot of time with brand experts. They figure out things on their own, uh, and mm-hmm. and the biggest companies have lot. They're spending money on everything. But smaller companies, and I think most superheroes, you can think of them as fairly small companies. They're small, like little tiny startups trying to figure stuff out and they're not gonna have a budget to go. Spiderman doesn't a budget these spending on public relations people and a marketing team and a advertising organization and like they, they don't have that stuff. Most celebrities may have a publicist and a manager at best. And I think most superheroes are behind. .Michael: Well then let's talk about the one superhero who seems to be constantly rebranding and who would probably benefit from having some assistance. Antman, I mean, giant Man. I mean, okay. , whatever he is. How many costume ?Edward: Well, he's just had three. Right. So he had Antman and he was fairly consistent as Aunt Man. Yeah. And then he rebranded to Giant Man, and that was very confusing. Yeah. For a long time we didn't even know the Giant Man and Antman were the same person. And then, and now he has a new costume again, so this is. His second rebrand, and as far as I know, he's sticking with the name this time. He's not rebranding the name, just the look and. .Michael: But it's sort of funny, so if you go through those cautions first, when he is ant man, he clearly looked like, he's small and stuff and it's just like a red costume and stuff. And then when he is giant man, he still had those sort of funny antennas on his, head that suggests like, all right, okay, and he's bigger, he's walking around and like all giant, he's a giant now. He's a giant ant. Like it's just like, why don't you just call yourself like big aunt or something, and then, cuz that's what he's like, why if you're now giant, man, when I think of giants, I don't think of having an antennas on their heads, but whatever. That's what he did and now he seems to have. Well, let me think about, look at the news. Did he, does he still have those antenna on his head in his new costume?Edward: I don't even know. I haven't, I should have done more research. I feel like I haven't spent time really examining this new costume of hisMichael: Well, regardless, it's another rebranding and so that's where I'm wondering. Okay. If he, if this isn't part of a plan, then what is it? Is it just that he's like, I don't know, I don't say this, but insecure about his, you know, he's just like, oh gosh, doesn't make me look so good.Edward: So I think it's like, Hey, stay. Staying with a consistent costume can't be easy on any of these guys. Now the advantage is they don't need to think of what they're gonna wear in the morning, but the disadvantages is how many costumes do they have to have? Like you, you and I, I think I have a fairly consistent brand in terms of what I wear. I don't wear, I'm not gonna show up to work in like, I don't know, green tights. I'm gonna wear the consistent clothes every time I go to work. , but it doesn't mean I wear exactly the same clothes. I might have a blue suit or a black suit. I might wear a white collar or a blue collar. I feel like I can change up within a range. Yeah. It feels like superheroes don't do that and maybe giant man is just trying that. He's like, you know what, today, I just didn't feel like the antennas.Michael: Well, okay. Just to loop back on that, I've looked at the, the reporting still going with the antennas, , I don't get it, but regardless,Edward: he's, keeping, so there you go. That's his consistent theme. Yeah. He was like, he was an ant man to a giant man, to a, new giant man, and he kept like the ant theme all the way along. And, that's a branding choice too. So you take some brand elements and you carry them forward so people can still, when they walk into the store to pick up their. Tide, the new Tide brand looks different, but it looks similar enough to the old brand. They're not gonna get confused.Michael: Okay. So he is following some of the rules that you've identified, but when you're talking about this costume idea, so leaving aside the branding issue is just how is it working with costumes? Because, you know, like I like to exercise as you, as you know, and so do you, and I've got a number of outfits that I use. For any other reason than practicality. If I exercise, I need to wash the clothing right away. So these guys are like, let's say take Spider-Man for example. That guy is swinging through the city. He must be sweating like crazy . And you think he just goes home? Is he doing laundry every single night,Edward: Do you think he has a summer version of his costume and a winter version? When it's cold out, he wears his warm tights and then the summer he's wearing I dunno, really, really thin tights.Michael: You'd have to, it'd be a winter weight and a summer weight but also on top of that, in the summer, you probably have to have way more versions of this costume . And so who's making it for him? Or is he just laundering it every night? Who made it to begin with, but then. , who's clean, who's continuing to make other costumes for 'em, or same version of the costume, which looks complicated. You see all the design elements and then clean.Edward: I guarantee if I was a superhero, I would be wearing block colors. There's no way I'm gonna making, these are like small black lines on my, I'd be like, I'm gonna wear red and I'm gonna go buy some red stuff and just make a red costume. The idea of sewing together the blue and the red, and then to your point, not doing it once. It's not like the guy behind Spider-Man's mask is, maybe he's a tailor for his side job, but, he's not making one costume. To your point. He, he must have dozens of costumes for the different seasons and, for the smell. If he has so many and to make them all identical.Michael: Yeah, it's quite an enterprise and to my knowledge, I don't think Spider-Man makes money from what he's doing so it's quite an investment. It's not just one costume. Maybe he could have gotten away with having a few of those costumes if he just was dressed in all black, for instance, with a funny mask and maybe you don't to, well, he had to wash the mask every night. If you're wearing this full head on mask, It probably It would stink too.Edward: Yeah, like crazy. And maybe that's, maybe he only has one or two costumes and he just washes them every night. He goes home. He has his own, he's clearly not taking them to like a public, dry cleaners. He probably has his washing dryer in his house and he's just running the washer and dryer. Every he gets home, takes off his outfit, washes it, dries it, and it's ready to go the next day.Michael: Or has the most discreet laundromat in the world, , you know, in addition to the most discreet Taylor, but that's not just him, right? It's all the, these heroes, they present with the same costume. And if we're comparing them to say, The police or the military, they have multiple versions of their outfits when they're on duty, when they have to wear outfits for work. It's mindblowing to me. So let's go to a team element, I'd imagine that, if you want to find out, I suspect they all know who each other are on this, on the Avengers. So we wonder if, find out who they were. I bet if they all are having their costumes washed by somebody or they're having mul tailors, , you know, prepare their costumes for, somebody's gonna speak about it. You know what I mean? It should, they should find out. Oh,Edward: well the Avengers are different though, right? The Avengers, we know they we're close with Star Corp. I'm sure Star Corp has like a supply of tailors and stuff to make these costumes, right? So whatever giant man's secret identity is, he's not taking the costume to a tailor a secret identity. He's just passing it into the, through the stark corpse team of people and they make the costume. They probably have industrial cleaners that take care of it every night for them. I think that's all veryMichael: standardized. . Can you imagine? What's your job? It's star carp. Okay, I've got a really top secret job, but job, I can't talk about it. And then as this man's telling his wife, I can't even talk about my job. It's star carp. I just cannot tell you. I can't tell you what I do. And then he's sitting alone in a dark room. He's like, I wash giant man's clothing. .Edward: I get, I get, that's what I do. I get the stand. You think your trouble tough, he was attacked by a lava monster. Getting lava stains out of these costumes is impossible.Michael: yeah. It's just like it. But that's what it would have to be. , it would be top secret, right? To keep his identity secret. So whoever's washing his clothing would have to like oh. Under, under penalty of like imprisonment. Don't tell, you can't tell anybody. You know anything about Captain America's the underwear he wears outside of his pants or whatever. It's just wild to me. It's just what a job.Edward: Well, I think I, we figured out the number one recruiting technique. I feel like if I'm an independent hero now, the number one reason to join the Avengers is not the money. It's not the fame , it's the laundry service.Michael: Sign me up, Eddie. Sign me up. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.superserious616.com

Super Serious 616
E191: Come on, ugly doesn't mean evil! (Amazing Spider-Man #23) -- April 1965

Super Serious 616

Play Episode Listen Later Feb 22, 2023 12:57


In this episode:Mike and Ed discuss the increased police presence in the city and how that is affecting both real and perceived crime. Is this because police have less to do as a result of the superheroes helping out? Is the presence of superheroes itself causing criminals to give up lives of crime, and maybe even become heroes? More to the point, is that what happened with the Green Goblin - he was inspired to become a hero? If so, why has he not changed his appearance? Does he want to be scary, or is what he truly looks? And how the heck does he balance on that glider - does he have abs of steel?Behind the Issue:This is the third appearance of the Green Goblin. Clearly, he does not become a hero. Steve Ditko and Stan Lee decided to keep the Goblin's identity secret, but behind the scenes they were debating who he should be. Lee wanted him to be someone from Peter's life, but Ditko wanted him to be a stranger. The disagreement meant that the Goblin's identity remained a secret from the readers until Ditko left the title (the Goblin's identity was revealed in the first issue after Ditko was replaced). Oh, the drama!In this issue:The Green Goblin tries to take over the New York City underworld, and while they are not convinced, he is definitely scaring them. Meanwhile, Peter Parker notices that former reporter and criminal Frederick Foswell is back at the Bugle. Apparently, the Bugle's publisher J. Jonah Jameson believes in redemption, or at least the value in giving people a second chance. Peter is not convinced that this is a redemption story, though, and he tails Foswell, whom he notices speaking with a thug. Foswell turns over information to Jameson that the thug had on a crime boss, who in turn provides this information to the police. The Goblin is overjoyed with these pieces falling into place - he has set this whole thing up to help him with his hostile takeover of the world of crime. Peter then changes into his Spider-Man outfit and tracks the Goblin, who tricks him into conflict with a mob boss and his lieutenants. Spider-Man basically does the Goblin's dirty work, taking out the gang and leaving them for the police. Realizing he has been played for the fool, Spider-Man finds and attacks the Goblin, who gets away. It's not all roses for the Goblin, though, who is disappointed to find out that Spider-Man did too good a job when he took down the mob boss and his entire gang, with the result that the Goblin had no gang to take over.Assumed before the next episode:The Green Goblin is going to need to rethink his whole gang takeover strategy.This episode takes place:After Spider-Man took down an entire gang.Full transcript:Edward: Feeling safer these days? Mike?Michael: No. ? No, I wouldn't say so. ,Edward: I feel like, like there's increased police presence on the streets. They're putting some crime bosses away. Is New York not a safer place than it was even a few weeks ago?Michael: Oh, well I guess that's standard than maybe, but I definitely have noticed a greater police presence in the last little while, certainly since the, a. Population of superpowered individuals on the scene. Do I feel safer before buildings could be captured and kidnapped and brought into space? I wouldn't say so in, you know, multiple invasions in New York City, butEdward: so, so, so, so clearly. Life is less safe now than it was in 1960 before.Michael: RightEdward: buildings. Were getting torn away, but I'm just talking about recently, like recently it feels like the superheroes are out on the streets. There's a bunch of them now. It feels like they're covering the ground around the monsters and the super villains, and that's freeing up the police to go and take out the normal villains.Michael: Well, I think so. I have noticed that there's more police for sure. I, don't know what element of that is performative and what element is that the costume vigilantes that we speak about every week have been in addition to attacking gods and monsters and aliens have also been attacking street level crime as well. There is no doubt that Ant-Man and now Giant-Man and Spider-Man and all the insect related heroes, I suppose are trying to deal with some street level justice, which probably is freeing up some time for the police to focus on other things, other elements of society that require policing. That's my guess. Or, is his performatively they're just trying to show that maybe they shouldn't be ignored. Yes, there's people flying through the air, but we're the police, darn it. And we're in the. Keeping you safe, .Edward: Yeah. That, that, that is something, right? If that performativeness makes us feel safer, it could also make the criminals feel less safe and drive the criminals back into the holes they came from.Michael: Maybe. It could, but I still wonder if it's just performative. It's almost just trying to get attention, if you know what I mean. Like it's like everyone's talking about Iron Man, but don't they know we're the real heroes, , and it's likeEdward: the, the every we have, we need more, less kids. Dressing up as Iron Man and more kids dressing up as everyday police officers.Michael: That's right.Edward: Let's have more realistic dreams. Kids. . .Michael: Yeah. Unless you are a super science genius, can invent your own costume, you should probably apply to the police academyEdward: don't expect to be superhero. Just be a regular, everyday hero.Michael: Yeah. And that's good enough. But no, but seriously, I guess I haven't made my mind up. I'd be curious about the statistics. let's just call it regular crime and whether police are being freed up to deal with more of the regular crime that's why we're noticing it. And if they aren't, if there's no real change in how much, in the impact of like regular crime and how it's being policed, then I think it is performative. And it just seems like they're just trying to get some of the attention. I have a mixed mind, not when it comes to the police in general, it's just they're not there to tell me what to do and not to do they're there to investigate crimes and well, and,Edward: and they've, and they, so they've had some successes lately, right? So, lucky Lobos basically says whole criminal enterprise got all swooped up. The Frederick Farwell, a former crime boss himself outta prison now working for the daily bugle, put together a. Basically did investigative reporting figured out where all of Lucky Lobo's financial records were kept and, blew it out to the police. And they shut down, not just the head of the family, but basically shut down the entire operation and that's gotta reduce crime. ?Michael: Well, yeah, it would, I think, I'm not saying that there haven't been some recent successes, it's just that I'd like to see that's more anecdotal. Or at least there's a recency effect here. I'd like to see what has been the impact? I guess I'd express it this way. What has been the impact of having superheroes and super villains out in, say, New York City on the ability of police to police regular crime? If there has been any impact, so is it that the superpowered individuals are taking care of that and a little bit of regular crimes such there's more effort being put into a policing regular crime or if it's just no impact at all. And it's just for show, I don't know.Edward: It's interesting when I was in business school, one of the studies that we looked at was about crime in cities. And clearly like when crime goes down, real estate prices go up. And so we, well, we cared about in business school was money Mike and how forget about safety, but how safety affects money. But the point was, When you could, one way to drive down crime and drive up real estate prices was to basically do us like a spike of policing. Because if crime was at a relatively low level, that meant the police that you had on duty could identify any new crime that happens and shut it down. But if crime is at a really high level, the same number of police can't handle all that crime, and crime goes unenforced, which then encourages more crime, cause you can get away with it. Your chances are getting cock down. And so you need to drive it down to a low level and then keeping. At that low level is a lot easier than getting it there to begin with. And so I wonder if this, like the spike in policing that we've seen, the performative nature of it, the fact that we have these superheroes doing stuff. Has that driven crime down to a level now that it's gonna be easier to maintain at a low level. And it's driving even super villains to become superheroes like so the Green Goblin, for example, now he's gone from being a villain to like apparently being a hero. And maybe that's because crime doesn't pay anymore. let's switch to the other side.Michael: Before we get to the Green Goblin, I understand the point you're making, maybe, I mean, again, but I think as a business person, you would like to see the data as would I, but I'm a little confused. Why are you saying the Green Goblin is, is acting like a hero?Edward: So Green Goblin was involved in this whole shutdown of The lucky Lobo criminal gang, he helped take them on and he was seen battling them and taking out the crime bosses. He's working for the good guys.Michael: Yeah, Goblin's always worked for the good guys.Edward: Are you saying? Saying maybe if he's gonna switch sides, he should change his name too and become like the green? I don't know. Green Elf, .Michael: I don't know. He is got this goblin mask, he looks frightening on purpose. So are you sure he's on the side of the angels now, ed, you don't see that maybe taking out a whole. Might be in the interest of someone who's previously acting like a villain and attacking the city.Edward: Oh, so you're saying that he's just taking out his competition?Michael: Well, I mean that's, yeah, I mean, cuz The Thing is, okay, how about this? Previously he was acting like a villain, dressed up like a goblin, and he's frightening. He's on this glider, he is throwing bombs. at a, I think wasn't at a TV state. At a, at a tvEdward: Wait, at, at, the fan event, the Spider-Man fan event. He was like terrorizing people.Michael: I think it was being filmed too, but whatever it was, it's certainly at a fan event. So that's a criminal? Who should be locked up? And so do we have such a short-term memory that he just is still wearing the same stuff with the same equipment? And he's like, no, no, no, no, no. I'm good now. Well, he reallyEdward: yes and no. So we assumed he was a villain, but we also assumed that Spider-Man was a villain, right? There was a lot of assumptions flying around with these people, and it's not like Spider-Man and the Human, Torch haven't had public battles in Times Square, like the go what did the Goblin really do in his past event? He basically tried to attack Spider-Man, but like, it feels like everybody wants to attack Spider-Man. Maybe he's just like a guy who like has a grief with Spider-Man and now he's like trying to do.Michael: Wasn't he throwing bombs at crowds of people?Edward: Wasn't the Human Torch throwing like fireballs at crowds of people?Michael: I don't think he, no, I don't think he was at crowds of people, but I don't know. But may I assume you're right.Edward: They were in New York City and there were fireballs going around and there were people in New York City. Now nobody got hurt, but I don't think anyone got hurt from the goblins bombs either, did they? .Michael: I don't know off the top of my head, but I think there's a difference between throwing a bomb into a crowd of people and then actually being engaged in a fight. But anyways, I don't wanna make that go down, that so far cuz then we get the whole idea that you're right, they shouldn't be fighting in crowded places, but let's, okay, let's assume he's the go, the green goblins now a hero. You're a business guy. Is this good marketing? Like should he, what if he just got a new costume?Edward: Fair enough.Michael: He's truly on the side of angels and just changed it. So he looks like, I don't know, the,Edward: well, here's the other thing. Do we know it's a costume? Patel? Maybe he's like a Defor. Maybe he's like, that's his face. Like do we know it's like an actual mask? Maybe It's like, like, I dunno, like the Hulk looks kind of weird and stuff like there, there's all sorts of villains.Michael: I think it's a rubber mask. I, I think that the reporting shows it's a rubber mask. It's not like as a skin texture, but,Edward: maybe his, I think he, like Mike, we live in a world of monsters and aliens. Maybe his face just looks like a rubber mask, , and the poor guy can't change his face. The poor guy is like this ugly. Deformed thing that was driven into crime because it was deformity and people were making fun of him, mocking him, people like you. And now he's trying to go to the side of good and we're still mocking his like ugly.Michael: So you heard it here first, folks, ed, nevermind humanitarian, , goblin, goblin, defender,Edward: . I'm just, I'm just saying that not enough people defend the ugly people. People like there are focus groups and there are groups that help all these different people who have a tough time in life, but there's no group of like the Association of Ugly people that helps people like,Michael: Ed, I think that you've got the organizational skills. I think you're the person that should do that. But I wanna talk about one other thing before we go on to your pledge drive to help the criminally ugly people in the world. But what do you think about the green goblin? And I was, I was kind of thinking about this for a while. Like, what do you think about the fact that he is flying around on a glider like technology that doesn't exist? Right? He flies through the air at fantastic speeds. On the one you think, he must be a genius to invent that. But on the other hand, don't you think he would take some special training in order to manage that? Like I as a kid found a skate. Challenging, you know what I mean? as an adult,Edward: many people can use skateboards. Michael , many people use skateboards.Michael: It's, yeah. But to really use it like, to do tricks and whatever and to go down the street. But as an adult, I think I would find it impossible. But what do you think, but what kind of skill level would it take to properly manage that glider? I mean, we've seen it. We've seen it in action. It's incredible what he can do with it.Edward: Clearly, clearly the goblin has some skills.Michael: Some skills, but where do, where does he get the skills? So he gets it from, is he actually a military trained operative who's now broken, bad or good? Depending upon your view of him. Is he like,Edward: maybe, maybe he's just a really skilled skateboarder.Michael: really skills skateboarder . But what if he's a foreign national scent here to just ferment descent? I mean, I don't know, but that's the first things that jump to mind, right?Edward: Yeah. Yeah. So , it's po It's possible maybe I'm a foreign national here to do dissent. Who knows. I think jumping to the conclusion just because this poor man is ugly, that therefore he is a foreign national Michael. Like, like they're, they're ugly people Are, they're ugly Americans as well,Michael: what I'm saying. Forget the, you're the one calling him ugly, by the way. I'm not like, I've never called the,Edward: you said he's so ugly and he must be wearing a mask that no human can look as bad as this poor man looks .Michael: I think he's wearing a mask. I definitely think that, but you're the one that calls it ugly. Anyways, the point I'm trying to make though, is that to talk about what is where do you think the green goblin's from? Right, and I think the ability in and of itself to fly in that glider tells me that he's had some training.Edward: Or, or maybe he has like superpowers, like other people do. Like Spider-Man, I dunno. Like spider, I'm pretty sure Spider-Man doesn't climb walls and fly on webs cuz of training. He's not like some foreign national or military guy. He has like some sort of superpowers that give him like the powers of a spider. Maybe the green goblin has like the powers of a goblin. .Michael: Yeah. He's got like an amazing core, . so strong, and he's like, he's like, his quads are unbelievable. Just like the power of like standing crouched like that and flying at like standing upright, well, flying through the air at 50 miles an hour. The amount of strength that takes.Edward: He's, he's ripped man. The man is ripped. So all you women out there that are worried about his ugly face, but he's a ripped body. You know, this is the trade off that sometimes has have with men. But I think Spider-Man for example without any, I think additional training could be riding that glider, captain America could be riding that glider. Right. We, we have a lot, we have a lot of these superheroes that have special abilities. To me, it makes sense that the goblin has these special abilities too, and the fact that he, and, maybe he didn't invent the glider himself. Maybe Tony Stark invented the glider and gave it to somebody who had the superpowers to be able to use it. .Michael: I'll tell you what I think that the Green Goblin, if he's listening to our show, should feel comfortable coming on our show because , hi,Edward: because it's a radio show and it's no video, so he doesn't have to worry about his ugly appearance.Michael: no, I never said he is ugly and he is clearly gonna offend and Ed, who thinks he's a good guy? So, come on the show Goblin, but leave your goblin pouch outside with the bombs. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.superserious616.com

Super Serious 616
Episode 190: Intergalactic peace treaty? Seems simple enough! Send in the Fantastic Four! (Fantastic Four #37) -- April 1965

Super Serious 616

Play Episode Listen Later Feb 16, 2023 12:07


In this episode:Mike and Ed discuss the peace treaty between Earth and the Skrull Empire, as negotiated by Reed Richards and the Fantastic Four. How does Reed have the authority to sign such a treaty on behalf of Earth? Do the ends justify the means? Don't the Fantastic Four have a conflict of interest given that a Skrull killed Sue Storm's father? How would we feel if a Russian super team completed this negotiation? And now that we have gone to another galaxy, are we going to be able to go to Mars?More detailed summary of the podcast (from AI):Edward and Michael are discussing the Fantastic Four's recent mission to the Skrull's home world. Edward believes that peace has been achieved, thanks to the efforts of Reed Richards. Michael is skeptical and points out that there is no evidence to support Reed's claims, and that the Fantastic Four's actions could be seen as hostile and unauthorized. He questions who authorized the mission and if it was sanctioned by the United Nations. Edward believes that sometimes the US needs to take action, even if it's not sanctioned by the UN, and that in this case, it worked out. Michael is concerned about what would happen if it didn't work out.Behind the issue:This is the first appearance of the Skrull home world, but it is not named here (and is not named until 1983 — “Tarnax IV”). The Skrulls keep their promise not to invade Earth for three years, but change their minds in Captain Marvel #2 when they discover that the Kree had an interest in the planet.In this issue:Sue Storm is unhappy that the Skrulls were not punished for killing her father. This leads to Reed Richards deciding to take the team to the Skrulls' homeworld to bring the murderer of Sue's father to justice. And so the team embarks on this mission, flying in a spaceship of Reed's design, and with the blessing of NASA. They land on the Skrull. homeward and battle the Skrulls, leading to their capture. They are held captive by the Skrull who murdered Sue's father, Morrat, who plans to murder the Fantastic Four too. Just before they are killed, Reed offers Morrat unlimited power in exchange for sparing their lives. Meanwhile, Morrat's girlfriend Anelle tells her father, the Skrull King, that Morrat has captured the Fantastic Four. This angers the King, who races to confront Morrat. Before he arrives, it is revealed that Reed tricked Morrat into repowering the team (they had been depowered when they were captured), and this time the Four are about to defeat the Skrulls when the King arrives with reinforcements. Anelle is nearly killed by accident by the soldiers during their standoff with the Fantastic Four but is saved by Sue's invisible forcefield. This leads to Reed negotiating with the King to deliver to them the Skrull who killed Sue's father. They learn that it was Morrrat, who has been killed in the firefight. The Fantastic Four then journey home, safe and sound from their adventure.Assumed before the next episode:Reed starts to wonder how far he will go to impress Sue. What do you do after nearly starting an intergalactic war?This episode takes place:After the Fantastic Four return from their wildly irresponsible revenge mission to the Skrull homeward.Full transcript:Edward: Reed Richards has done it again, Mike. There is peace in the world. Peace in the universe. There's peace in the galaxy in the entire universe. We are no longer at war with the scrolls. Thank you. Reed. Richards.Michael: Well, okay. ? Yes. If we believe what Reed Richards says, then sure. But much like a lot of Reed Richard. Advice to us about battles and adventures that are unseen. There's no other proof beyond his good word. And what's kind of crazy right now is that what we're talking about is how Reed Richards and his team, the Fantastic Four, went to the scroll home world.Edward: That's right. We took the battle to them. They've been invading us, and we said, you know what? Enough of this, we're gonna take the battle over. I was gonna say overseas, but it's not overseas. It's over stars. What do we have vocabulary for? What they.Michael: over empty space. They went to the squirrel home world. A home world of people of, sorry, of like beings that can shapeshift and turn into,Edward: I think you can call them people. I think squirrels are people.Michael: Well, okay, let's call 'em people. They,Edward: they're not human people, but they're still people. Like, I think that we can use the broad definition of people. I think it could be insulting to call them. Not people. They're an animals. They're, they're people.Michael: Okay, well, sure, we'll call 'em people. So, but they're people that can take the form of anybody. So we're taking the word of Reed. Richards that he. To the scroll home world to negotiate a peace treaty, but at the same time also bring a killer to justice like somebody who killed his future father-in-law to justice. So let's break this down a little bit. ,Edward: there's a lot going on here, Mike. And we haven't even gone to the fact they didn't go there alone. They combine the technology that they've developed with research scientists at NASA in order to develop this, subspace traveler to travel to other galaxies. Like we've just opened up the universe for human explor.Michael: Okay. That's fascinating. And so, and I,Edward: you don't seem to care, like you don't seem to care on theseMichael: I aren't you, Lou, aren't you a little worried, ed, that it looks like either, there's a few things happening. Number one, the Fantastic Four took it upon themselves to basically invade a planet for no shifting people.Edward: It was with, nasa, it was Fantasic, Four, and nasa.Michael: I haven't read that being, I know that they had NASA technology, but did NASA Greenlight the plan to go invade another planet, to grab somebody and then also negotiate a peace treaty? And does NASA has a capability to do that? Is that within their authority?I doubt it. Number one, ,Edward: I don't know. I'm not sure The founding fathers really decided on what NASA could or could not do, was wasn't on their list of priorities when they were making the constitution in the 1700.Michael: Well, it, it wouldn't be, but that's just assuming that this only affects America, which it doesn't. What happened here is that American citizens went to another planet and in a hostile way to grab one of their citizens to bring them to justice, number one. And number two then apparently had free reign to negotiate a peace treaty with these people. And that isn't,Edward: what do you prefer? They didn't, Mike, do you want them to go there and then start a war? They went there and they ended a war. That's good. That's good news.Michael: Well, I don't know. I mean, this is what we're hearing.Edward: What you don't know. You don't know. Do you want us to be at war with them? You, we. Peace is good news, right? We can agree on.Michael: No, no, but hold on a second. We have to go through the proper channels on this to figure out this is done right, and this is actually in our interest. So number one, who green lit this? Who authorized this? Is this an American thing only or is this on behalf of the world? Did they go to the United Nations and get, and somehow, for the first time in human history, Get all the nations to agree to one thing, which was that we're gonna send these four people who aren't trained in any form of diplomacy to go there in an active war and negotiate peace. That is wild to me that that would be authorized by anybody.Edward: Well, I'm pretty sure the UN did not authorize it, but if we waited for the UN to authorize things, nothing would get done and we'd still be at war with the scrolls. And so sometimes the US has to take things into their own hands and just take action. And we did take action and it worked out.Michael: Okay, this time, okay, let's say what would happen to it if it didn't work out. Like it's like we send the Americans send these envoys being the Fantastic four who have no training in this type of activity of negotiating peace. Send 'em over and it backfires. And at least the, to this girls actually, redoubling their efforts to take over the earth. Well, and it's not just Americans pay the price of the entire, it'd be the entire Earth.Edward: Are we at, would we be at any worse place than we were?Michael: Yes,Edward: the scrolls were already ready to, these girls have already attempted at least two or three invasions that we know of. They're, they're coming after us. They're trying to take over our planet, and now they're.Michael: So I'm wondering yet if they're trying to invade us because Reed Richards ghost to their planet and kidnap their citizens . You know what I mean?Edward: Like this is the, this is the first time he's gone there. They, unprovoked, they came after us and they came after us again and again trying to take over our planet and now we've turned the tables on them. This is like Japan has attacked us in World War ii. And we turned the table and said, no, no, no, you can't take our Hawaii. We're gonna come after you and go to your islands. And that's what we did. And we did it well enough. And, and not only did we do it well enough, we did it with a small little Strikeforce team. We didn't have to blow up a scroll planet or even a scroll city. He went in and spoke with the emperor himself, herself, emperor somebody. He, negotiated with somebody over there and they've agreed to not attack us. .Michael: But Ed, if you bring in like the, world War II and America fighting Japan. Japan attacked America and America responded by. That was an act of war, which led to America actually fighting Japan, which is, yeah, I don't wanna sound too Pollyanna, but limited between those two countries. At least at the start of it, right before the countries actually can volun, can actually declare war on the other nation here effectively. The United States declared war on the scrolls and thereEdward: no declared war on the planet Earth and they and America stepped up and got them to say, No,Michael: no, but America has to go, has to go through the proper channels. They can't just decide something so significant about going to war with another nation without actually getting the rest of the world on board with it.Edward: Well, they're not, but they're not going to war with the other nation. The other. The nation declared war, not the nation, the emperor, the empire, the squirrel empire declared war. On earth, on all the countries on earth. Cause they don't care to them. We're all the same. We're all, we're all people, we're all humans. And so the US says Hey, no one else is taking care of this. No one else has the technology to take care of this. But this fantastic four working with nasa, developed the technology to go after the scroll home world. And they went straight there and they negotiated a piece so that the scrolls, wouldn. Anyone on Earth again, it wasn't like they negotiated a piece just with America. They could have done that, but why would that, that would be a terrible thing for them to do. They said, Hey scrolls, go ahead and invade our planet as long as you leave this continent alone.Michael: How would you have felt if Russia, which does have Superpowered individuals and does have, technology, what, how would you feel that they went to the scroll world and tried to do what the Fantastic four did and it back.Edward: Well be a, be a problem if we backfired. But it didn't back. If it didn't backfire. If the Russians went over there and negotiated the scrolls, I'd be like, given like a little swastika, high five, no, well, not swastika. What do they have? Would I be doing that hammered hammer sickle? I'd give a little sickle high five. There are enemies, but they, but they helped us. They would, and that's great. Sometimes the Russians and the Americans need to get together. Were on the same side to stop the squirrels from.Michael: But Ed, but so right now on our earth, we actually have international organizations that are designed to work cooperatively to actually achieve the goals of the group, right? We have the United Nations, which is the entire earth. We have nato, which actually is set up to to deal with the Warsaw Pack group of countries. And so there, it's not like one NATO country could decide to attack Russia without having. , quite frankly, the rest of the nations in NATO objecting to it. There's a system in place and I think the same thing should happen here when it comes to dealing with intergalactic relations.Edward: Well, maybe there was May.Michael: I don't understand why there isn't.Edward: May, maybe there maybe NASA and Fantasic Four talked to the rest of nato. I don't know. We don't know exactly what the channels they went through. I'm pretty sure they did not ch check in with the Soviets before they did it. But I think that's just the world we live in. We live in a in the, in reality, we don't wanna be sharing our subspace travel technology with the Russians for as long as we can anyway.Michael: But right now, the first question is there a clear and present danger presented by the scrolls to the planet Earth? And you're saying, well, because they've invaded before and they've been repelled. The answer is yes. Okay, fine. Assuming that's correct, then, is it that every country for itself can deal, can figure out how to deal with it and then how do they and I think the answer has to be no, it has to be that there's no,Edward: you're right, you're right.Michael: You're in a democratic, the democratic nations that are involved in military alliances that they wouldn't actually consult with us to figure out what the right plan is. I dealt the right plan. If I was in, involved in it would be, we're gonna send these, just these four people. If you're really truly deciding to invade this grow planet. You probably had a lot more than four people, butEdward: Well, they were trying to invade though, they were trying to create peace. They were, they were creating peace. They're not, they weren't, you're not gonna invade a planet with four people, but maybe traveling through subspace in these spaceships. We probably don't have the technology to send battalions. We don't have the technology to send warships and stuff with us. We have this technology to send four people, and so we sent the four people that we thought could handle it, and they did.Michael: Well, they didn't consult me and you and I aren't doing interview this. I'm offended on behalf of the rest of the earth, number one. But number two, I would say this, if they consulted with the Avengers, they could have had access to giant man's technology, shrunk them, everybody down, shrunk down, all like the ships and the planes and all the soldiers and stuff, and then gone there instead of letting Reed Richards go off in some kind of, Cowboy Justice Mission to, to grab the scroll that had killed Sue storm's, father, and then incidentally negotiate peace, which is I think, which is what I think happened. I'd rather have had an authorized military action by the world, or at least the majority of the world, it's something that, at at least smacks of democracy or democratic approach to these things because there's the consequences will be felt not just by America, but by the entire world. And then actually start thinking about using the technology that we know exists in a proper military application in a military way.Edward: I lo I love the idea of giant man shrinking down the US military into ants and sending the whole whole army over there. And hopefully growing them when they get to the other side. Otherwise, Having a bunch of ants fighting that this girls made have been a problem. But, I think it be hard, but the risk with that now is now you're risking a real war. Right? If we go and actually invade their planet with thousands and thousands or hundreds of thousands of soldiers, that risks escalating the war, and instead of escalating, we sent four people who they went in, they had a polite conversation with the emperor explained the miscommunication, explained that we were a people's too, and that we shouldn't be invaded. And if they did invade, we would hit back hard. And they were able to prevent intergalactic war.Michael: But that's my discomfort. They sent the fantastic floor who clearly had a bone to pick with the scrolls and were looking for a tray. They were trying to get them the person or the, the scroll that had killed, one of their fathers. I don't think that's how typical diplomacy works. It's not like we send over emissaries to like Russia. We don't send like the son or daughter of somebody who's killed by a bunch of Russian spies or soldiers. They might have a bit of too much skin in the game for that. They might not be objective when they're negotiating the peace treaty, I think would, I'd rather send somebody over that ha could be a little more objective and uh, and.Edward: Yeah, fair enough. Can negotiate properly. Sometimes you go to war with the army. You have not the army that you dream of, right? Like we had the Fantastic four who were able to go and do this. They had the technology to get over there. They had the diplomatic skills to do it. And did they have some conflicts of interest? Sure. . But, but, but, but they, they, they worked around those conflicts of interest and they saw, they saved the day. They saved the planet. They saved potentially the galaxy. They may have saved the universe, and I think we should give them some credit.Michael: Well. . Okay. Tell you what, let's just, at the risk of making this ad hominem, you sound like a typical business person saying, sure, there's some conflict of interest. is, did we, did we break the law? Did we do something that was totally in our own self-interest? Guilty is charged, and I'm saying as a lawyer, it's a conflict of interest. Hold on a second. That poisons the whole, in that the whole analytical approach, these things. So again, I work for businesses, I work for business people. I think they're all great. I don't wanna hurt my. Business structure, but come on, Eddie . This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.superserious616.com

Super Serious 616
Episode #188: Is Thor Faster than a Speeding Bullet? (Avengers #14) -- March 1965

Super Serious 616

Play Episode Listen Later Feb 2, 2023 17:19


We used a new AI tool to create a “complete episode summary” (see below). Please take a read and see if you find it valuable. If you do, please respond to this email and like the post. If there is enough interest we can generate the summary for all future episodes (and previous ones if there is enough demand). It costs ~$5/episode for the service, so we will only do it if there is demand for it. Let us know!In this episode:Mike and Ed discuss how the Wasp is being treated while she is in critical condition and digress into trying to understand just how fast Thor can fly. He can cross the Atlantic in three minutes. That is faster than any plane, train, or automobile! Is it faster than a rocket? Does he light the air on fire? What would it be like to be saved by Thor at that speed? Do we need to worry about mid-air collisions? Should we apply speed limits to superheroes?Full episode summary (AI generated from audio):The Trouble with Thor's Speed - Controlling Velocity for Protection.1. The Wasp's Critical Condition: An Update2. Uncovering the Mystery Behind Thor's Travels3. Controlling Thor's Speed: A Discussion4. Speed Limits: The Need for Superhuman RegulationThe Wasp in Critical ConditionReports of the Wasp's condition have been grim, but optimistic. She is currently stable but in critical care. With the Avengers involved, it is unclear what sort of medical help she is receiving and what types of injuries she sustains. It could be something as common as a car accident or sports injury, or something more specific to what the Avengers do.The Mystery of Thor's TravelInterestingly, Thor has been reported to have been flying around the world, potentially looking for a specific doctor to help the Wasp. Reports also indicated that he flew across the Atlantic in three minutes, much faster than any plane could go. Whether he is flying suborbital, as some science fiction theories suggest, or following flight paths at a certain altitude to avoid mid-air collisions, it is remarkable to consider the speeds at which Thor is traveling. One aspect of Thor's power that often goes overlooked is his impressive speed. During a podcast discussion, the hosts discussed just how fast Thor can fly. They estimated that Thor can fly at about 80 times the speed of sound - Mach 80 - which is much faster than any mechanical aircraft on Earth, and even faster than a rocket to the moon.Controlling Thor's Speed:The hosts then discussed how Thor's speed might be useful in saving people. They concluded that Thor would need to understand how to control the speed. If he could fly to someone quickly but then decelerate to a stop, he could rescue them before they were injured. They also discussed the amount of power behind his speed, and the air displacement it could cause if Thor flew by someone on the street. All in all, Thor's speed is an extremely impressive part of his power set and is a major factor in why he is considered one of the most powerful superheroes., The speaker highlights the potential problem of an individual traveling at a speed far beyond what humans would normally experience. They discuss the potential damage that could be caused in the wake of someone flying at such a high speed.The speaker questions whether the superhero, Thor, should partake in control testing far away from other people, to see the damage that could be caused by traveling at such a high speed. They point out that although the idea of traveling from one place to another quickly may sound great, it could lead to destruction in his path. The speaker emphasizes the need for speed limits for a reason, to ensure that people are not traveling too fast, resulting in destruction.Behind the issue:This issue deals with the cliffhanger we were left with in issue #13, with the Wasp in critical condition. The story introduces a new alien race, the Kallusians, but they are not revealed to the human race, and they are never mentioned again in the Marvel Universe.In this issue:The Wasp is in critical condition, and with not a moment to spare, Thor flies to Norway to basically kidnap a medical specialist, Dr. Svenson, to hopefully save the Wasp's life. It turns out that Dr. Svenson is an alien in disguise, and when his mask is removed he dies. And so the Avengers are now on the hunt to find the real Dr. Svenson. They do that by tracking down the aliens in the North Pole; they have a futuristic city beneath the Earth's crust! The aliens subdue the Avengers and, being the bad guys, they monologue about themselves and their plans. They're the Kallusians, and they escaped an interplanetary war and hid out on Earth. They have trouble breathing on Earth, and when all looked hopeless, Dr. Svenson stumbled their way, and they kidnapped him, convincing him to help them figure out how to breathe on Earth. Dr. Svenson figured out how to help them, but the Kallusians have refused to release him. The Avengers break free, battle the Kallusians, and then find out that Dr. Svenson does not want to leave, as he has agreed to stay and help them with their breathing issues for as long as they need to hide out from their interplanetary rivals. And after that exposition is provided, the Kallusians' alien enemies locate them on Earth! What are the odds? Anyway, Thor basically scares them to leave the planet and fight their enemies in space, freeing up Dr. Svenson, whom they take to New York City to operate on the Wasp and save her life (he does). The Watcher also shows up at the end of the episode to explain how lucky it was for humanity that the two warring alien races did not duke it out on Earth.Assumed before the next episode:The Avengers are likely wondering what to do with the now-abandoned alien city beneath the North Pole.This episode takes place:After the Wasp's life has been saved!Full transcript:Edward: the wasp, is still in critical condition? Mike? They think she might recover, but we don't know her her state right now.Michael: No, but I suppose good news to find out that she hasn't passed away. She hasn't died in the line of battle. And our thoughts are obviously with her and the rest of the teamEdward: I think they're saying stable but critical. So she's in critical care. Mm-hmm. , but not getting worse. Stable. They're trying to find some sort of doctor to help her, and they're communicating with us. And so I think we're cautiously optimistic, right.Michael: But you gotta wonder, you gotta wonder what is it? We don't know exactly. We know that she was injured injuring battle. But is it something that is a run-of-the-mill medical issue that could happen to any of us if you're in a car accident or you're in a sports event or even in a regular military engagement?Or is there so. Specific to what the Avengers do, and if it is the latter I'd be curious because we've been following the superhero SUPERPOWERED community for so long, is there something unique that's being done for her? .Edward: We don't know. And it's nice of them to share at all. I think at this point, you don't want to give away too much of the secret sauce that makes them superheroes and what could possibly hurt them? What are things that can hurt the wasp? Probably the same things that can hurt you and I only, mm-hmm. , she's just far more athletic and capable and able to change.Michael: Key among them is that she changed the size. I mean, that seems to be, to be an inherently risky thing to do . So I'd be curious about what the injury is, and also it may affect the ability to treat her. I don't wanna speculate too, too much out of respect for the wasp, but I'd imagine that. There could be something complicated about her physiology now.Edward: We don't even know what size she is now. Is she being treated Yeah. As, a wasp or is she being treated as an adult human, or is she like a giant man? She's extra big. We don't know what size she is. And maybe that's part of the complication. Maybe she is mm-hmm. In a very small form and maybe a very special doctor who's able to treat her with special in.Michael: Well, and don't say this analogy too, too far, but it could be a regular surgeon who might be involved, or doctor, it could be a pediatric surgeon if she happened to be, you know, size, smaller size, quite frankly, it could be a veterinarian, you know what I mean? To deal with the idea of no, seriously, she, oh, sheEdward: has wings, , maybe her wings are anything.Michael: She, she has wings, but also she might be super small, like a small animal. Or she could be the size of a horse, you know? And both those were the fields of veterinarians. So I don't wanna, I'm not trying to suggest in any way anything more than she is a mammal who might be a different size and there are specialists that deal with that. And, on we go, good luck to the wasp .Edward: Do you think this is why, Thor is flying around the world? Is he looking for a specific doctor to help her?Michael: That's what I started thinking about, so we heard the news, that Thor was being tracked, flying across the ocean and by the reporting, and this is interesting, I hadn't heard this before. Thor traveled across the Atlantic Ocean within minutes, within minutes and , you know, and, and it's like, I would've thought he could have, if you believe he's is an as guardian, he's a, a Norse God from Asgard. that he would travel in some form of interdimensional, something rather, that we don't know about. But no, he didn't, and he didn't do that to go to Europe and said he just flew across the yo.Edward: We don't, we don't even know what, I think at one point people thought he has his hammer and he is just so strong that he swings his hammer around, throws the hammer and the hammer like, I dunno, the hammer's so powerful. It pulls him in a direction or people thought that he's the, got a thunder. He can control the weather and maybe he's using the winds to pull him around. But neither of those explanations make sense when you can cross the Atlantic in three minutes.Michael: No, and, the first thought I had is okay, number one, so air travel is carefully regulated. There's flight paths between say New York and London and miami and Dublin. And so there's gonna be paths, and the idea is it's very carefully regulated to make sure that you don't run into people. Uh, so planes don't run into each other as they're flying at the required altitude so is Thor flying? I would imagine Thor to be, if he wants to get there quickly, would probably fly to certain altitude, much like the planes to cut through the air as well as you can. Well,Edward: I'm sure again, Thor does not wanna be part of a mid-air collision. Imagine the news when Thor runs into an airplane and Families are destroyed and died because he was blasting through them with his hammer. And it seems like that's a very easy thing to avoid by just flying at a different height than airplanes fly at. I'm not sure what flight, I'm sure there's like certain flight paths and certain flight altitudes and he would just fly either like lower or presumably higher.Michael: Well, but think about this with my point is that I suspect that, and we should talk to an aeronautical engineer we probably could confirm this. There are heights you likely. for maximum, efficiency,Edward: well that depends on how you fly, right? So airplanes fly because they have engines that are shooting off exhaust that are propelling them forward, and then they have wings that are providing lift. So as they propel forward, the wings provide lift and they get lifted up into the air. And then they can control that up and down. There's no exhaust coming from. , at least no visible exhaust. Unless he's no I don't wanna be vulgar here on the radio, but I don't think there's like exhaust coming from his ass, like pushing out, pushing him through the spaceMichael: Too many beans ,Edward: too many beans. . If, if he's, if he's ever gets into shilling for products, he should definitely promote beans. Like Oh, get your, get your Aus Garan beans from Thor.Michael: It's a magical fruit. .Edward: The, the, the more you eat, the more you fly.Michael: fly. no, but, I'm getting a little bit away from what I really wanna talk about, I would think that there is, if you're Thor and you wanna get across the ocean quickly because your teammate. Needs you to do something, which is what Thor was doing, that you would probably do your best to fly the most efficient way across the ocean. But you're right, I don't think he'd irresponsible. So he is likely isn't flying that high.Edward: Or, I think he's flying probably higher. Like higher. Here's The Thing too. If, if he's. Given that he's like the mighty Thor, he probably is able to survive pretty high in the atmosphere. I dunno, can he survive in space? It wouldn't surprise me. He feels like he's like, he feels like he's the type of person who would survive in space, didn't he? He sent the absorbing man. Yeah. Right into space. Maybe Thor can survive in space and so if he can survive, he can go high enough. It depends if he's able to, if he's able to propulsion himself high enough, he doesn't need air to prop, repulse himself off of which he may not, then going higher is actually better for him cause it's, it's less wind, there's less wind resistance, less air resistance.Michael: Could he also, like, could he also break through the atmosphere and spike up and as the earth is, if he's going across to Europe, the earth is moving in his direction and he goes up and then down, that would be. Efficient way of getting, of getting across the earth quickly. Right.Edward: That's true. So instead of flying in a straight line, he could just fly suborbital that. That's, and there's been lots of science fiction written about that. If you wanted to go mm-hmm. to from London to Sydney as fast as possible, and we had the technology to do it, we would fly a suborbital flight that would blast off. It'd be a parabola, we'd basically a parabola from one to the other. Yeah. And so maybe if that's how Thor travels parabolas.Michael: I mean, in my head, I must say, I wasn't thinking of parabolas. I was thinking of Thor, kinda like just flying, just barely above the ocean. And hopefully not hitting a ship, but maybe he's the right height to not hit a ship either. But my thought was if he flies across, and this is what I really wanted to talk about, even though I'm kind of fascinated by the idea he'd fly into Pablo, which so cool. ,Edward: we, we, you, we should, we should have, we should think, talk more about paras. It feels like parabolas are under talked about topic on radio University.Michael: Our listeners love it. They love those parabolas, but if you are getting across the ocean within minutes, let's say it's about three minutes, and it's about over 4,000 kilometers. Well, you tell me are you applying so fast that you're we're gonna light the, like the air on fire. You know what I mean? That, that seems un unfathomably fast.Edward: It is remarkably fast. I, so yeah. Let's, let's, let's run through the math and so, okay. I know we are in America and we should be using, local imperial measurements, but when you start talking about the speed that Thor is flying at, we're gonna use that archaic metric system that the French use and cause the math is a lot easier. And so the ocean is like roughly, I think from North America through to Europe. We're talking at roughly 4,800 kilometers, 4,800 kilometers, 3000 and something miles, right? For the rest of us. And then, He did that in three minutes. So he's doing that at what, 1,200 kilometers per minute? That's, uh, no, no, no, no, no, no. He's doing three times that. So he's doing, yeah, in a minute he's doing 15,000 kilometers or 14,000 kilometers or something like that. Per, per, no, no, no, no. That was right the first time. No, no. He's doing a little over a thousand kilometers in a minute, and then in three minutes he gets all the way to the 5,000 kilometers. But that turns out that flying a thousand kilometers a minute is really, really, really, really fast. And like the speed of sound is about a third of a kilometer per second. . We do some math, dividing, whatever. I think it works out too, that he was flying at roughly 80 times the speed of sound. So, so mock 80. Mock 80. For those who are familiar with the mock termsMichael: And how fast, I mean, what's our fastest plane like, how fast did the rocket to the moon?Edward: Oh, that's a good question. I don't know I should know that to break the orbit, right? But like I know that planes, like passenger planes don't fly that fast. They fly no, significantly slower than the speed of sound. The really, really fast, like breaking the sound barrier, which we did before we went to the moon. Breaking the sound barrier was a big deal. And that by def the sound barriers was what, what we call mock one and I know we have planes that go faster than the speed of sound now, but not a lot. Fast mock two, mock three, something like that. Thor was going mock. It's fast.Michael: I don't think that that's fast. It's fast. And I don't think that when I, when we've seen the footage on, on our, the rockets to the moon. I don't, they don't, I don't think they were going that fast. At least visually didn't seem that they're . You get across the ocean. How high, how high is it to get to get, to break the atmosphere? Right. How, how high is it? It's not, how high is the atmosphere? Four. Yeah, it's not tough. 4,000 kilometers and it takes, it took a few minutes certainly to get above, to break the atmosphere. So they're not going as fast as Thor a Thor can get across the ocean.Edward: No, no. So, so the atmosphere, so I think the atmosphere is bigger than that man. I think the atmosphere is roughly 10,000 kilometers up.Michael: No,Edward: yeah, yeah. Like 6,000 miles or. And depends, depends where, depends where you, it turns out there's not like a line, there's not like a fence where like now you're, now you're in space and it slowly becomes less atmospheric all along. But when you start going the, the high atmosphere, it's like roughly, roughly 10,000 kilometers, 6,000 miles.Michael: Okay. Well, could you get up there in, I guess within 10 minutes? Does it, does the rocket take, did the rocket take 10 minutes to get above there? Which would be kind of similar to Thor flying across the ocean?Edward: Yeah, so he is going, I think faster than rockets. I think Rockets are going, yeah, I think so. Like somewhere under 10 kilometers. Like they, when they get going to speed, they're going about 10 kilometers a second. And what do we say Thor is doing? Thor's doing. 80 times the speed of sound. And the speed of sound is a third of a kilometer per second. So what's that 80 divided by three? He's doing 20 times, 25 times, times the times. 25 kilometers per second, something like that. And our rockets when they're like, when they're really, when they get this really going up there when they're really picking up speed. They're doing about 10 kilometers a second. And so he's roughly two and a half times faster than a rocket . And so that's, but, but as fast, it's fast. It's fast. But as fast as, rockets aren't setting air on fire. I don't think Thor is setting, he's not setting air on fire fast.Michael: No, no. But he's still going fast enough, like faster than any any mechanical device on earth,Edward: he's definitely the fastest human in any form of transportation that's ever happened.Michael: And it's funny because I guess we've always sort of, when we talk about Thor or any of these heroes, we focus on a few things, like for Thor, we've always focused on, he's a p he's very strong he's a God. But I've never thought much about him flying, which is funny because if you started flying, I would think that's incredible Ed. But it's, um,Edward: and, and if I started flying at 80 times a speed of sound, you'd be like that is, that is extra incredible. That is like more incredible.Michael: Yeah. That's worthy of a discussion. But, um,Edward: that could be don't, but your point is that could be a main power. If someone's power was flying 80 times the speed of sound, we would be. Wow. You are definitely one of the best superheroes on the planet. And yeah, the fact that that was Thor's, fourth or fifth power.Michael: Yeah. Like Thor. Let's just break it down. So if Thor, if you're walking across the street and you're carrying a coffee and you're not paying attention and a truck comes barreling at you, Thor could easily grab. You know, maybe that's not the most heroic thing, but move you from the, the crosswalk so you don't get struck. But there's probably something, there must be a better example, but I wouldn't even know who saved, you know what I mean? That fast,Edward: you know, like if he moved that fast on a human, Thor is very solid. He's a very strong human being who bullets bounce off him and that most bolts don't bounce off cars. And so he is big, he is stronger than a car, more solid than a more dense than a car. And if a car was. 80 times the speed of sound and ran into you. You would not be saved. Saving is not The. Thing. That would happen. .Michael: That's right. Well, is there a way to like, you know, when you catch a ball, someone throws you at a ball at you, right? You kind of grab it and you control the momentum of it. We think we talked about this before. Sure. So is there a way that. How about this? Let's slow it down. ,Edward: I think, I think if you were thrown at Thor, if someone like threw you at Thor and Thor, caught you, but then went with the motion, the way you went with a ball. Yeah. Then yeah, I think that he could stop you from, from being squished, but if you were flying at him and he said, you know what? I need to get to you quickly. I'm gonna fly towards you at 80 times a speed of sound. Like you're not gonna have a body left after.Michael: So if Thor is going at 80 times, the speed sound up to you thinking, oh, that person's in a crosswalk he's gonna get struck by that truck that's outta control. And he went up and just touched you. , , his finger would just go right, like right through your body as he just continued on. There must be a way that he could do it.Edward: Would, would you rather hit by a truck going at. 20 miles, 50 miles an hour. Or Thor going at like 1000 miles an hour.Michael: Oh, Thor. Thor. It'd be so much cooler to get blown up that way,Edward: but I guess if you're gonna die, go out in style .Michael: Well, could you do this? How about this? I'm still now thinking about it. What if Thor went very quickly and went. Under the ground and cut the ground out from underneath you and lifted you through or would like, there'd be so much wind resistance you'd be ripped apart by Well,Edward: if you move through the air Yeah. You're telling me what if the ground underneath me started flying upwards? Mm-hmm. Immediately at 80 times the speed of sound. Yeah, that would, that's not like, let's be human. When we, when, when, when we first started trying to break the speed of like, the sound barrier, like people died trying to make their break the sound barrier, and that's mock one. We're talking about mock 80. It's not, there's, there's no scenario, no world where, that is a helpful place for a human to be.Michael: Okay, let me loop back then, ed. I don't know if it's the most useful power then for saving people. Perhaps, but it's useful to get to where you need to go. As long as he's maneuverable and he can stop and maneuver and not run into things, then that part's useful but I was thinking like, what if he'd be a very useful superhero if he could just go really fast and get you outta danger, but if he just blow you up every time he touched you, ?Edward: No. I think the key is using his speed to get to you and he has to. He just, we need to understand how fast Thor can decelerate. That that's the key. If he can, that's critical fly, fly to you very quickly, but stop on a dime and pick you up gently. Fly away slightly faster than the truck is coming towards you.Michael: Here's another question then just think about how fast story. So, he's coming at you. Is air being pushed in your direction? Or is it not? Or is it, or is he cutting through it?Edward: I think generally he's cutting through air. He's moving so fast that I don't think, I think he's moving faster than any air particles getting pushed. I think if he blew pa, if you were like standing on the side of the road and he blew past you, I don't think you would experience anything until he passed you and then all the air he displaced would hit you and it's like a train. When a train comes by, you can feel the train coming after the fact, but it's not coming before the fact.Michael: Okay, so let's say again, using my example of I'm in the street. Flying on the street, what would happen if he's flying through and, then at that speed, or he is even slowing down, would not like, there would be a train, a trail of destruction right behind him. Things, you know what I mean?Edward: I, could see that I could see like a bunch of it. It, yeah I think what we're dealing at with is an order of magnitude of speed that I think us normal humans can't really comprehend. And, we just don't, we don't experience speed like this at any normal time in our lives.Michael: So I, I'd like to, I guess, Thor, I'd like you to maybe do some control testing far away from other people to see, because I mean, just in case you're attempted to like race to the scene of a crime or an incident or some event that you wanted to prevent at first. Seems like a great idea. But in second thought, it sounds like it might be complete, like it'd be fine flying across the ocean it doesn't run into anything. But it wouldn't be that fine if he's flying across North America, if he's getting too low to the ground, causing damage in his, in, in his wake, right.Edward: Yeah. Hey, hey, we have speed limits for a reason. Thor, we have speed limits for a reason.Michael: Yeah. Yeah, that's right. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.superserious616.com

Super Serious 616
Episode 187: Super Managers not so Super (Tales of Suspense #63) -- March 1965

Super Serious 616

Play Episode Listen Later Jan 26, 2023 9:54


…and we are back. For those waiting patiently, sorry for the hiatus. Mike and Ed both had great holidays, and are now back on track with weekly episodes. Both this one and next week's were a lot of fun. Enjoy!In this episode:The rumors of Tony Stark's death were greatly exaggerated. After three months of absence, the titan of industry has returned, and Mike and Ed have opinions! Iron Man was apparently a terrible replacement boss while Stark was away. What makes anyone think a superhero would make a super boss? New joke: How are superheroes like doctors and lawyers? Tune in to find out!Behind the issue :This ends the four issue storyline of Tony Stark being stuck inside the Iron Man armour, and the challenges that created for his personal and professional life. The second half of the issue is a re-telling of the origin of Captain America. Recall back in the 1960s, getting access to character origins was a lot more difficult than today, so many readers would not have known Captain America's origin, and regular reminders were important to the mythology.In this issue:Iron Man wanders into the office and acts like a real jerk to Pepper and Happy. They think that Iron Man let Tony Stark get killed, and as such, they are not thrilled to see him anyway. Iron Man/Tony gets to work behind closed doors at fixing his chest plate so that he can live without wearing the whole Iron Man suit, and figures it all out. Now out of his Iron Man costume, Tony struts out of his office like nothing happened, causing serious confusion to Pepper and Happy, and the world at large. He explains that he was caught up in a secret love affair and is engaged to be married. People seem relieved that Iron Man will no longer be at the helm of the company. Meanwhile, the Phantom is attacking Stark facilities, leading to unsafe conditions for workers that causes union bosses, and the government holding the Stark military contracts, to put pressure on Tony Stark to catch the Saboteur. Iron Man ends up catching the Phantom, who turns out to be a jaded Stark employee.Assumed before the next episode:People are wondering how stable Tony Stark is, after disappearing for months on a love affair with an unnamed woman.This episode takes place:After Tony Stark has “returned from the dead”.Full transcript:Edward: Out with the new and in with the old Mike, the old guard is back.Michael: Well, I'm sure that the market responded favorably to find out that Tony Stark is indeed among the living .Edward: Yeah. It turns out the laser from space that destroyed his residence and we all thought he died. He wasn't, he was, he just wasn't there. He was off having a gallivanting with some woman that he's now engaged to.Michael: Yeah. And so I, think. Leaving aside our interest in the SUPERPOWERED community and the Avengers, I think that there's a lot of questions that arise just for the head of one of the most important companies in the world. Just, disappearing for months, for a fewEdward: weeks, months. At a time. For months now? No, it was it months. How long was it? Months. It was months. It was, it like when the,, I'm trying to think of the exact date when the laser hit, but it was back in January or something. We're in April now. Like that's, that's a long time to be like, oh yeah. The, whole world is freaking out. The, stock is plummeting. Iron Man is running your company and, just. Did you not just read, check the news? Is he not just looking at the morning news and be like, you know what, I should probably correct the record.Michael: Well, it's not just the idea that he owes an obligation to his company, his employees, his shareholders. How about his personal life? I mean, ed, if you were reported dead and just disappeared for months at a time, I'd be worried and I'd be quite upset with you.Edward: Thank you, Michael, for caring about me. .Michael: Well, yeah, I'd be worried. And, just like with Tony Stark, there'd be, funeral announcements and it'd be articles written about it. I dunno if you get the same treatment. , I would notice and the have you come back from the dead would be, shocking that you, it'd be a shock and it'll also be disappointed that you'd treat your personal relationships like that.Edward: Oh, can you imagine? And not only that, you probably, we've, you love replaced me on the show. There'll be some new, new host for, three where a helmets , where your helmet, because that new host does not want to reveal his identity.Michael: No. Exactly. And then, and then just turns out, it turns out that you were alive all the time. This whole time you just decided to take a break from life, have a fantastic old time, just gallivanting a around, well,Edward: not just Galvan, he dropped back into life, not just Galvan. He was so, he dropped out of life. He didn't drop out, he dropped out of his professional life, but he accelerated his personal life. The guy's engaged to get married. .Michael: Yeah. Yeah. Well, I think that's,Edward: that takes focus, Mike. He couldn't be distracted by things like running his publicly traded company. He couldn't get distracted by maintaining his relationships, couldn't be distracted by informing the public of what's going on. He was focused on this woman like that. That a hundred percent focus.Michael: So you're saying that maybe the key to Tony Stark's life and his success has not been that he's a multitasker, but he's a uni tasker. He's a uni tasker. So he can only focus ,Edward: the ultimate uni tasker, .Michael: Yeah. So it's just like, okay, you know what? I'm going to, uh, be the leader, a captain of the industry, and then I'm gonna take a four month break and devote myself to wooing this one woman. And then what happens now doesn't bode well for the engagement, I must say, not his return to taking the reigns of Star Corp.Edward: Yeah. Like, well, yeah, I guess now, now he's gonna be focused a hundred percent on Stark Corp. And this woman's gonna get left in the dust. And, hey, my prediction. Prediction right now is that this wedding doesn't happen. He's so distracted now by running the company. He can't do two things at the same time.Michael: Well, that leads to the next point that we have is that, so, we've discussed before how odd we've found it that a man, or we think it's a man in an Iron Man costume operating under a pseudonym, has been running one of the most powerful companies in the world.Edward: Well, Mike, if, Iron Man was a woman, don't you think they would call it Iron Woman?Michael: Um, they could, but who knows? We don't, we don't know what's under the mask though, ed. It could, it could very well be a, woman who's in a man's costume, but, but, um,Edward: oh, that, that would be the ultimate trick, right? Like she calls herself Iron Man, but she's really a woman. And then now everyone, no one, no one suspects the woman under the mask.Michael: exactly, but whoever it is. The reports have been coming out now since Stark has taken the reins that I don't think that Iron Man was the best boss, or at least the most well liked boss. And, and maybe it's not a shock for a few reasons, right? Like number one, you didn't know who it was, who are you talking to? Who's giving you the, these orders? It's a massive,Edward: he's like, he's like, look, look, look me in the eye, or like into these little holes that you get. You, you, you, you assume there's eyes.Michael: Yeah. Like, you just don't, it the unsettling to work for someone who you didn't and you didn't know their, real name or what they even look like, what they were like, I mean, you know,Edward: or, or, or facial expressions. Like so much communication is facial exp Like, I tell my boss, like, oh, I wanna go and do this. And they don't say no, but you see it like in their eye. You're like, oh, maybe I, that was a, that was a, I shouldn't have told them that. I shouldn't have said that. It doesn't, you know what I mean? Like, you can, we can read these signals. You can't read any signals from an Iron.Michael: No, it's unsettling. And I think it really is a counterproductive to developing a proper workplace and or a happy workplace.Edward: Mike's rules for man, Mike's rules for management entail, uh, show your face, .Michael: Show your face and tell them your real name. I mean, those are, to me, those are deal breakers and they should have done, he should have done that, but he didn't. And the stories that are coming out like show that just wasn't well liked. And it's, again, it. unsurprising because of the reasons she just said. But also because you know, we've speculated, you and I have speculated openly on this show, did Iron Man have something to do with Tony Stark's disappearance?Edward: Well, turns out, no turns there. There was suspicions about that, but turns out Tony Stark did it all by himself. He was off like . This woman, this woman is to blame not to not Iron Man, unless this woman is Iron Man. Wouldn't that be a twist?Michael: Whoa. Well then, yeah, then we got a whole other, other episode on this. But no, it's, I think the reason why people might be unhappy with Iron Man is because they thought he might have been involved in the disappearance of Tony Stark, and maybe they're annoyed now in retrospect that Iron Man must have known all along that Tony Stark, someone that the, company grieved and the workers grieved for months is alive. So maybe that's why, it's another reason why they wouldn't be that happy with, with Iron Man. Now.Edward: Well, well, hey, let's count the reason. So, number one, they thought that he killed the old boss. That's a way, that's a reason not to like your boss. Number two, he's wearing an Iron mask. We don't know his name, a reason to dislike your boss, but here's number three, which is , how much management training do you think Iron Man? How much experience do you think he has managing people? His specialty The. Thing, he's really good at is, being a mighty hero who saves the earth from aliens. That does not necessarily mean you're gonna be good at managing one-on-ones. .Michael: Yeah. It doesn't translate into, reviewing reports and giving feedback to people that are working for you and saying, you know what, maybe we should work a little, harder on this, on this marketing plan. Jerry .Edward: Let, let's, let's, let's set our priorities and you know, what my priority is saving the planet. What? What's on your list? What are your OKRs this week? What are you planning to get done? I just don't see Iron Man being particularly good at that. I mean, maybe he is, but if he does, it's uncorrelated with his ability to save the planet from aliens.Michael: Well, yeah and let's say this, I would suspect that Iron Man might be connected with the military, and I said that because he's acting as a superhero, and works with the Avengers who are connected with the American military. So I'd say that in the best case scenario, from a management perspective, iron. Man may very well be a military person. I don't know if military command structure translates very well to corporate structure. Right. Okay. It might be a little more severe.Edward: Yeah. Yeah, that's, that's fair. Although there is, there's lots of successes of people coming out of the military and having very successful careers in corporate America. So I think that if he was trained by the military and if he has a lot of military training and being able to, the military, the military's different than the Avengers. Avengers is five people. The military, if you got to any degree of seniority, you're managing, overseeing hundreds of people. And if you have the skillset to do that, you probably have, it's very similar to the skillset of running a big corporation. Not the same, but there's overlap. There is no overlap, in firing a blaster and like shooting off in rocket.Michael: Realistically, yeah. No matter where Iron Man came from his, yeah, his skillset was dealing with extraterrestrial, and interdimensional threats. It's funny because he was one of the most popular people in the world, one of the most popular heroes in the world. It saved,Edward: We've done episodes on that, on how well he managed his PR for so, .Michael: Yeah. But it turns out maybe being a superhero doesn't make you a super boss. It might make you a terrible boss. Oh man. The world's the world's greatest hero. The world's worst boss. .Edward: So they've done studies of salespeople, and you take your salespeople and you take your best sales. The best salespeople tend to get promoted to being sales managers. And when they do that, it turns out that the best sales people aren't the best sales managers. In fact, if you look at the people who are promoted to sales manager, it tends to be. Of the people who are promoted, the worst performing sales people who are promoted tend to be the best sales managers. And so Iron, Man being one of the world's greatest. You know what? Given the fact that the most popular hero becomes a terrible boss, maybe we should look at the worst heroes out there, the least popular heroes, and give them the promotion.Michael: Spider-Man is up and down. , you know,Edward: Spider-Man, spider boss. Spider Boss.Michael: Well, it's funny because I know that when it comes to I work in as a lawyer and this is no secret on lawyers and law firms, but, as lawyers, we're not trained in running a business. Number one, we're trained in the law, but if you're in private practice, you run a business. And number two, we're not trained in management necessarily. Of the very successful lawyers that I know, they're driven by their personality to some degree, and a lot of them operate as solo people. Even if they work in a firm and to go from that to managing a business is, it would happen later in life, in your career and I've seen it, not necessarily across the board, but it's challenging for the people to make that leap. And I've heard the same thing about doctors. Doctors, might be excellent doctors, but not great business people.Edward: I think what we're saying is there's two types of people out there. There are people who are good at managing and there are doctors, lawyers, and superhero.Michael: That's good. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.superserious616.com

Super Serious 616
Episode 186: Where do sabertooth tigers come from? The past … or Antarctica? (X-Men #10) -- March 1965

Super Serious 616

Play Episode Listen Later Dec 15, 2022 8:55


Apologies for no episode last week. Here in 2022 we are also shutting down for the Christmas holidays. We should be back the first week of January. Also: Welcome to all the new listeners. If last episode was your first with us, we would love to hear how you heard of us. Apparently we are now the #25 top Marvel podcast, but that was published on December 11th, and we picked up many new listeners on November 30th. Where did you all come from? If you subscribe at www.SuperSerious616.com you can reply to the email we send you and you can tell us. We would appreciate it if only to satisfy our curiosity! See you in the New Year!In this episode:Mike and Ed discuss the mind-bending news that a sabertooth tiger has been found in Antarctica. Does this mean that other previously assumed extinct animals are not actually extinct? What about dinosaurs? Questions abound!Behind the issue:This is the first appearance of Ka-Zar and the Savage Land, which will go on to be a major environment in X-Men comics and the Marvel Universe more generally. There are rumors that the Savage Land and Ka-Zar may make an appearance in the MCU during the Thunderbolts movie due out in a couple of years. This is where it all began.In this issue:The evening news broadcasts a video from Antarctica of a Tarzan-like figure with a sabertooth tiger fighting explorers to the frozen continent. The X-Men suspect that this wild man may be a mutant, and they decide to investigate. They head to Antarctica and find a secret passageway through the frozen environment to a tropical land filled with dinosaurs and other strange creatures. They also encounter warriors fighting with preindustrial weapons. The wild man Ka-Zar and his sabertooth tiger Zabu come to their aid and help turn the tide of the battle. The X-Men leave, having made a potentially valuable ally.Assumed before the next episode:People are still wondering whether the sabertooth tiger is real, and if so, whether other extinct animals may return from the dead.This episode takes place:After the amazing news that a sabertooth tiger has been cited has been somehow lost in the new cycle.Full TranscriptEdward: Mike, when did Sabertooth Tigers go extinct?Michael: I don't know exactly, but I thought they were prehistoric. Did they not go out at the time of the Willie Mammoth? Think so. 2000 years ago.Edward: I feel like, my understanding is that they, ex, number one is they existed. They're not like a unicorn. Unicorns never did exist. I know some people think that unicorns went extinct, but they did not. There was never a unicorn as far as we know. But sabertooth tigers, which kinda. Kinda unicorns. Cause they have giant, huge, giant teeth that kind of stick out. They existed and I think they were North American. I think they existed in North America. Yeah. And then when people came across that the land bridge into Alaska and then came down through the continent, there were all these crazy animals there. And humans just basically killed them all. By the time the Europeans got there, there weren't many of these big animals left. There were still bison and there were cougars, but, things like the mammoths and the sea two tigers were all killed off.Michael: Were they killed off or they just die? I don't know if there's historical record for it being killed off by humanity, but I thought,Edward: I think the record is, they overlapped with humanity. So humanity was there at the same time as they were. And, humanity lasted and they didn't. So they died off at some point after humans were there. And it turns out humans liked to eat animals. So there's a possibility that humans. Them all.Michael: I thought it'd be more temperature. I thought it'd be more temperature related.Edward: It could again, maybe, maybe Was Willie Mammoth ? Well, there's, there's wooly mammoth in Europe I think as well, but they also went extinct. And we know that humans ate those things for sure. Mm-hmm. , I think there's a lion, but regardless Europe, there's a lion in Europe too, and that, that also went extinct and we know that humans kind of wiped that out. I think I was curious what's going a lot of these animals in, in North America, they basically, they didn't have a defense against humans. Like all the animals in Africa. They evolved along with humans and the ones, and so they had defenses against humans. But I think all those animals in North America, we were an invasive species and we showed up and the animals had never seen us before, so they didn't know what.Michael: That's interesting. Well, anyways, you asked me, but going back to the beginning. Yeah. So Saber Tooth Tigers haven't been around for a long, long time.Edward: Except now they are.Michael: Except now they are. Yeah, I mean, likeEdward: they're back baby. They're back.Michael: They're back. They're back. And they're better than ever. So the people, uh, they watch thisEdward: not just as a sports team logo, basketball. No.Michael: Well, like, so what we're talking about,Edward: I feel like there should be though, shouldn't there be, why isn't there a sports team with like the Philadelphia Sabertooth Tiger.Michael: Well, I, support it, but now they could probably get one maybe, but, for people that aren't, that haven't, haven't watching the news lately, what it is, is that there's a recording, a video recording of a man who looks like Tarzan walking with a sabertooth tiger who's attacking people in Antarctica. And it's like, it's so,Edward: can interrupt thatMichael: crazy.Edward: He looks like Tarzan. What does that mean? That means he, that means what does Tarzan even look? You mean like the drawings, the things that were on the covers of his books like a hundred years ago.Michael: Yeah. Like a bear chested, loin, loincloth, guy walking around Antarctica, which is odd with a se tiger.Edward: When you're saying he looks like Tarzan, you're basically saying there was some dude without clothes on.Michael: It's for our younger listeners. I didn't wanna get too graphic, but Yeah. Some, some dude is basically wearing Speedo, walking around Antarctica with a sabertooth tiger.Edward: Mike's gonna go to the next swim meet and he's gonna be like, Tarzan Tarzan's everywhere.Michael: Well, that's what comes to mind when there's a man dress in a loin cloth with a prehistoric animal. Yeah. It kind of makes sense. Or with a big cat, like a saber tooth tiger. But there's a saber tooth tiger.Edward: Yeah. But, Tarzan was never a, didn't have prehistoric animals in those books, did he? He was just, it was a chimpanzee, elephants,Michael: the lord the jungle. No, he's in charge of the jungle and this guy's in charge of, it looks like from the video that he's in charge of the sabertooth tiger. And so, no, that's why, that's my connection, . But anyways, the Tarzana, the tar side. What I'm really getting at is that it's nutty.Edward: Don't get confused by the Tarzan reference. Tarzana is not evolved.Michael: I'm moving on from it. Moving on from bit, but here it is. So a sabertooth tiger. And, 10 years ago we would be, it would've blown our. If there's a video of a saber tooth tiger, that would be the front page of the news. I don't think many people know about this. Number one, and number two, we can't. We, you and I were talking before our show. Neither of us can totally agree on what is the most likely reason. There's a sabertooth tiger right now.Edward: Yeah. There's a couple of things going on. Number one is, there's a sabertooth tiger. They went extinct thousands or tens of thousands of years ago, and now there's one back. So that's weird. Number two is it didn't appear in North America where they were last seen. It appeared in Antarctica. , which is like a weird place for it to be. And then number three is of all the, the weird places for it to appear. How does it survive in Antarctica? Like nothing survives in Antarctica. There's penguins.Michael: And, and then so you say, well, where would it have come from? Because presumably, if there's been a line of savory tooth tigers for thousands and thousands of years that we didn't know about, there would be some evidence of that. And, people that investigate these things and the study of prehistoric animals just got it wrong and missed it and missed the evidence of years and years and years of sabertooth tigers prowling around or, the evidence, their bones or whateverEdward: Be fair fossils if sabertooth tigers were really prowling around Antarctica this whole time, we haven't spent much time in Antarctica. I just think the evidence that any animal could survive in Antarctica is so low. That's the reason why we haven't been exploring Antarctica, is it's not really a place where animals survive.Michael: Well, so that leads, okay, so number one, sabertooth tigers can survive in Antarctica. That's number, that's the first question, but it doesn't make a lot of sense because there are mammals, they're furry mammals that would live in,Edward: they're predators. They have to eat other animals. If this sabertooth tiger is surviving in Antarctica for any period of time, that means there are prey animals living in Antarctica for some period of time. And I don't think it's just penguins. Like I think we've studied penguins in Antarctica as far as we know they do not have lions preying on them.Michael: No, no. And so, it's kind of odd, but that's the most logical thing is that just it, we just happen to have missed it. And that's the conclusion that we'd have to draw if this was 10 years ago. But we have to entertain other possibilities. Could it be that we know time travel exists? So maybe it's a time travel thing.Edward: That sounds a really easy answer, right? Like if, Kang who came here and tried to take over our timeline, take over our world, what would stop him from just going back in time and picking up a caveman in a sabertooth tiger and bringing them into our time. That sounds very reasonable.Michael: It's a possibility or maybe it's another dimension that overlaps with our, we know that there's other dimensions and overlaps with ours and just maybe that. There's a crossover point down there. Maybe,Edward: maybe in that dimension, Antarctica is like hot and bombing because we also know that a long time ago in humanity, Antarctica was hot and bombing, it was a nice warm right place with lush forests and so on. Maybe there's another dimension where that never changed and we got a portal to that dimension and these guys hopped through.Michael: Maybe it's an alien because we know that there have been alien attacks and they seem to be similar. The aliens seem to be relatively similar to how we look, so maybe there's versions of mammals on other planets and this is just an alien either left their sabertooth tiger here, or maybe the sabertooth tiger is an intelligent species from another planet and we just haven't found the spaceship .Edward: And he brought along his prehistoric man as a pet .Michael: That's right. That's what it is and then maybe the other one I was thinking maybe it's from Asgard or something. Maybe it's from where Thor comes from. Because just a magical beast just like Thor's a magical Oh, that's true. God, I don't know.Edward: And then this magical beast might be tens of thousands of years old. It's an un aging magical tiger.Michael: Yeah, but the point is that we don't know. And so,Edward: oh, I have another, I have another possibility.Michael: What's thatEdward: robot? You know what I mean? We've had robots be we're we thought they were aliens. Turns out they were robots or we thought it was Iron man. Turns out it was a robot. It feels like robot impersonators are a thing. Why not just make a robot cat?Michael: How about, and that's a good idea. But how about this also, it came from underneath the earth.Edward: Oh, we, Atlantis is we know there's, there is an Atlantis underneath the earth. That could be a, it's almost like another dimension at this point, but yeah, that makes sense. Totally.Michael: Boy, this all leads though. Is thatEdward: Maybe this old Atlantis kidnapped primitive humans. Mm-hmm. and and, giant cats and mammoths and stuff. And then breeding them underground in zoos. And these ones just escaped from the zoo.Michael: Well, the point is that these are all now equally logical. , right, because it's just because there are of theEdward: broadest sense of the word .Michael: Well, but there are, there, they, we know that there's these are things that are, have happened last few years and so it, it doesn't stretch the imagination to believe that this is that there are sabertooth Tigers through any of these various reasons. So this is why you and I have been doing what I consider to be the hard news Ed, where we've been talking about the real stories. And I do think, these things have to be studied so that people, we, we could turn to, a more scholarly academic source to say, oh no, we've looked into this and turns out the robots who promote it, and now that people can study itEdward: like mad scientist, it's a mad scientist who found ancient DNA and recreated primitive man and and tigers.Michael: Oh my, I love it. I love it.Edward: It's, it's The Thing. It's The Thing for an academic to dive into.Michael: Yeah. Well, you know, Ed, if you and I, if our legacies that we're encouraging scholarship, so be it. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.superserious616.com

THE WONDER: Science-Based Paganism
INTERVIEW: Michael of the Atheopagan Society Council

THE WONDER: Science-Based Paganism

Play Episode Listen Later Nov 28, 2022 45:35 Transcription Available


Remember, we welcome comments, questions and suggested topics at thewonderpodcastQs@gmail.com   S3E41 TRANSCRIPT:----more----   Mark: Welcome back to the Wonder Science-based Paganism. I'm Mark, one of your hosts. Yucca: and I'm Yucca. Mark: and today we have a really exciting episode. We have an interview with a member of the Atheopagan Society Council, Michael, who is joining us today, and is gonna tell us about his journey and what this community means to him and his vision for the future and all kinds of cool stuff. So welcome. Michael: Well, thank you very much for having me. Mark: I'm delighted to have you here, Yucca: Thanks for coming on. Michael: Yeah, no, I'm excited. Yucca: Yeah. So why don't we start with so who are you? Right? What's, what's your journey been to get here? Michael: Gosh. Well, I kind of have to start at the very beginning. So my name's Michael and you know, I've, I start, sometimes I go by Mícheál, which is my Irish, the Irish version of my name. And that's something I've been using more as I've been involved in the Pagan community. My parents are both Irish and. They moved to the United States in their early eighties cuz my dad got a green card working over there Mark: Hmm. Michael: and I was born in America. And then they decided they want to move back to Ireland then in 1991. So already I had this kind of dissected identity. Was I American or was I Irish? I never really lost my American accent. When I, when I moved to Ireland my sister who was born in Ireland, she actually has a slight American accent just from living with me. So she never people always ask her, are you, are you American? And she's like, I've never lived there. So it's funny that it's kind of stuck with her, but I moved to Ireland and I suddenly was kind of got this culture shock at the age of five and moving to this new country. And my mother has a very large family, so she has like, two, two brothers and seven sisters, and then I've got like 30 cousins. So , it was a big, a big change from AmeriCorps. It was just the three of us. Moving back to Ireland and. It was a very, you know, Ireland, you know, is, would've been considered a very Catholic country, and it's been kind of secularizing since the nineties up until now. But back then it was still quite Catholic. Like homosexuality was only decriminalized in 1992 and divorce was only made legal in 1995. So, I guess the first kind of sense of, of what I meant to be Irish back then was, You know, you learned Irish in school, you learned to speak Irish in school, and this was very it wasn't taught very well, I would say, and I think most Irish people would agree with that. It's kind of taught like almost like Latin or something as a dead language rather than as a living language. So you're spending time learning all this grammar. And you don't kind of develop that love of it that I think you should. I did go to like Irish summer camp in the Gaeltacht . The Gaeltacht  is the Irish speaking area of Ireland, and I kind of became aware of my Irishness, you know, just through being part of all this and also. I would've introduced myself as American when I was little but people didn't really like that. It was kind of a, like a weird thing to do. So my mom eventually told me, maybe you should just stop paying that. And so throughout my I, you know, as I mentioned, it was a very Catholic country. And when I was in the Gaeltacht in Irish summer camp one of the kids said they were atheist. And I was like, what does that mean? I'm like, I don't believe in God. And I was, and in my head I was like, I didn't know you could do that, I didn't know that was an option. . So I kind of thought about it for a while. I became, we started studying the Reformation in school when I was about 14. And then I learned that Catholics believed in transubstantiation and nobody had really mentioned that before. They didn't really teach the catechism very well, I guess. I'd done my communion and my confirmation, but nobody ever mentioned that. We literally believed that the, the body and blood, you know, was that the bread and water? Oh, sorry. The bread and wine actually became literally, And the body. And I thought that was a very strange thing, that that was a literal thing. It wasn't just symbolic. And then we also studied Calvinism and all that stuff. And I was like, then I started to read the Bible and I was like, then it fun, it finally just dawned on me that I didn't believe any of this, and it was kind of liberating. But it was kind of a way of being d. In a very homogenous society too. You could be a bit of a rebel. So I think I was one of those annoying teenagers who was always questioning everybody and having, trying to have debates with everybody about religion and they didn't enjoy that . And so I went through school and I just remember hating studying the Irish language until eventually when I left school. On the last day, I actually took all my. My Irish textbooks and burnt them and I feel I . Yeah. I mean I feel so much guilt and regret about that and I think about that how important it's to me now and that, that was a real shame that, but I didn't, partially I didn't put the work in, but also I just think the structure. Was not there. I mean so many Irish people come out of outta school not really know, knowing how to speak the language, you know, and I think it is an effective col colonization as well, where, you know, you consider English is a useful language and learning French or Spanish, that's a useful thing, but there's no use for Irish in people's minds, which is a, and I find that a real shame and I. could go back and change that. In university I studied anthropology and history because I was very interested in religion. All throughout my teenage years, I was obsessed with learning about world religions, you know, there was a world religion class in, in secondary school. I didn't get into it, but I begged the teacher to allow me to. Into it because I was so interested in the topic. And he was like, fine, fine. And he kind of thought he'd humor me in one class one day and he was like, well, Michael, maybe you could talk about satanism. That's the topic for today. And I was like, well, let's start with Al Crowley. And he was like, okay, maybe he actually knows what he is talking about So, I went, I. I went to the university sorry, national University of Ireland, Minuth Campus. And it's funny because that used to be known as so it's actually, it's two campuses. They're St. Patrick's college, which is like a, a seminary for priests. And there's the I, which is like the secular version, and they're both, but they both share the same compass. So it's funny, it used to be the, the biggest seminary in Europe. They call it the priest factory cuz they pumped out so many priests that sent, sent them all over the world. And it's when you go out and you walk down the corridors, you see all the graduating classes. So you go back to 1950 and you see a graduating class of like a hundred priests. And every year as you're going down the corridor, it gets smaller and smaller and smaller. Until I think the year I graduated, there was like two people graduating as priests. Yeah. So that was, that was a, I decided to study history and anthropology at n Y Minuth and one of the books that I read. Was kind of a gateway into thinking about land and language, which are two things that are really important to me in my, when I think about Paganism. It's a book called wisdom Sits in Places by Keith Bato, bass by Keith Bassell, and. I'm just gonna read a little bit here from the book because he was an anthropologist working with the Apache, the Western Apache, to try and remap the land using the Native Apache words rather than the, the English words. So trying to make a native map and working with Apache people to find all the true, the true names of all these. so this is the quote, but already on only our second day in the country together a problem had problem had come up for the third time in as many tries. I have mispronounced the Apache name of the boggy swale before us. And Charles, who is weary of repeating it, has a guarded look in his eyes after watching the name for a fourth. I acknowledged defeat and attempted to apologize for my flawed linguistic performance. I'm sorry, Charles. I can't get it. I'll work on it later. It's in the machine. It doesn't matter. It matters. Charles says softly to me in English, and then turning to speak to Morley. He addresses him in Western Apache, is what he said. What he's doing isn't right. It's not good. He seems to be in a. Why is he in a hurry? It's disrespectful. Our ancestors made this name. They made it just as it is. They made it for a reason. They spoke it first a long time ago. He's repeating the speech of our ancestors. He doesn't know that. Tell him he's repeating the speech of our ancestors. And I'm gonna just there's another section here, a little, a few pages. But then unexpectedly in one of those courteous turnabouts that Apache people employ to assuage embarrassment in salvage damaged feelings, Charles himself comes to the rescue with a quick corroborative grin. He announces he is missing several teeth and that my problem with the place name may be attributable to his lack of dental equipment. Sometimes he says he is hard to underst. His nephew, Jason, recently told him that, and he knows he tends to speak softly. Maybe the combination of too few teeth and two little volume accounts for my failing. Short morally, on the other hand, is not so encumbered though shy. Two, a tooth or two. He retains the good ones for talking and because he's not afraid to speak up, except as everyone knows in the presence of gar women no one has trouble hearing what he. Maybe if Morley repeated the place name again slowly and with ample force, I would get it right. It's worth a try, cousin. And then he, I'm just gonna skip forward a bit and he successfully pronounces the name, which translates as water Lies with mud in an open container. Relieved and pleased. I pronounce the name slowly. Then I, then a bit more rapidly and again, as it might be spoken. In normal conversation, Charles listens and nods his head in. . Yes. He says in Apache, that is how our ancestors made it a long time ago, just as it is to name this place. Mm-hmm. So this became important to me when thinking about the Irish language because something similar happened in Ireland in the you know, we have all our native Irish place. But in the 1820s the British Army's Ordinance survey came and decided they were gonna make these names pro pronounceable to English ears. And so they kind of tore up the native pronunciation and kind of push an English pronunciation on top. So you have these very strange English Anglo size versions of Irish Place names Yucca: Mm-hmm. Michael: Soin in is is probably better known in English as dingle, but doesn't really have anything to do with the Irish. And there are plenty of, there are so many examples of this and I think when you're trying to learn about a landscape in your relation to a ship, to a landscape, it is important to know the native place. It's something that I think about a lot and I try to learn. One of my favorite writers is named Tim Robinson, and he's well he died in 2020. But I had the opportunity to meet him in 2009 and he was an English cartographer. But he moved to the west of Ireland, to the Iron Islands and also to Kamara. So he kind of moved between those two places. He lived there for more than 30 years, and what he actually did was he went out and mapped the landscape and talked to local people, and he was able to find some of the place names that had been lost over the years that weren't on the official maps, and he was able to help recreate a Gaelic map of those areas. I think that's a really kind of religious or spiritual activity to go out onto the land and walk it. And to name it and to name it correctly. And I think that's what I think my pagan path is in a way. It's to go and walk the land and learn it, what to call it. Cause I think language is the most important tool we have as pagans. Mark: Hmm. Michael: So those are, that's kind of when I started to think about this stuff. I've always been interested in folk. It was actually funny. There was, it started with a video game one of the legend of Zelda video games called Major's Mask Mark: Hmm. Yucca: Yep. Michael: in, in the game, they actually have like a mask festival and they dis they discuss the the history of the festival. Anna was just like, wow, I didn't, I ended up making masks with my sister and we kind of pretended to. A little mask festival of our own Yucca: Mm-hmm. Michael: that you're, you're familiar with that? Yucca? Yucca: Yes. Yeah, I played a lot of it. Michael: Yeah. So, but I guess I really started to think about folklore when when I watched the Wickerman as um, as a teenager. I was probably at 16 when I watched it, and it kind of opened my eyes completely. And we've talked a lot about this in the group. And I. It's watched as a horror movie in a way, but   I think I really got into the, the paganism idea of, of paganism as a teenager because of watching the Wickman and just the symbolism and the pageantry. And I also just like the idea. These island people turning on the state in the form of, of the policeman. So that's kind of been something I've that I've really enjoyed over the years, watching that every every May as part of my, my, my annual ritual so, you know, after university, I, I moved to South Korea to teach English, and, but at the same time I was quite into Buddhism. I had been practicing some Zen Buddhism from about the age of 18, and, but not like, more as just a practice rather than believing in any of it. Not believing in reincarnation or anything like that. I just found the ritual of it very beautiful. And I ended up going and doing a temple stay in a, in a place at, at a temple. Up in the mountains and it was very beautiful and really amazing. You know, something you'd see in a movie because the monk, the head monk actually brought us out into a bamboo grove and we sat there meditating just with all surrounded by bamboo. And it was waving in the wind and it felt like a correction, tiger Hidden dragon or something like that. And one of the powerful events that happened on that trip. Doing the Buddhist meal ceremony where we ate in in the style of a Buddhist monk. And the idea is that you do not leave any food behind. After you're, after you're finished eating, you've, you eat all the food, and then when you wash the bowls and they kind of put the communal water back into the, the, the waste bowl, there should be no no bit of food, nothing. It should just be clean water. That comes out of, after everybody finishes washing all their bowls. So we followed all the steps to do that and, you know, some people really, really weren't into it. They didn't wanna do the work of, of being extremely thorough. And there were a few rice pieces of rice in the water at the end and the head monk said to us oh, that will now get, you're, you're gonna cause pain to the hungry to ghost. Because the hungry goats ghosts have holes in their throats, and when we pour the water outside for the hungry ghosts, the rice particles are gonna get stuck in their throats. And a lot of people were like, what? What are you talking about Mark: Hmm. Michael: But I thought that was beautiful because it doesn't, not, you don't have to. It's a story that has a purpose, and that's why, you know, It made me think about the superstitions that we have. And I don't know if I like superstition like these, calling it that. Cause I think a lot of these things have purpose and you have to look for the purpose behind them. And the purpose of that story of the honky go story, maybe for him it is about not causing harm to these, these spirits, but it's also about not wasting food. And I think it, it has more power and more meaning. And you remember. More thoroughly when you have a story like that to back up this, this practice. So I think it kind of made me rethink a lot about the kind of folkloric things that I, in my, in the Irish tradition and that, you know, I think about things like fairy forts, which are, you know, the, these are the archeological sites that you find around Ireland. Like, I think there's like 60,000 left around the country. These, these circular. Homesteads that made a stone or, or saw, or saw that you find all over the country and people don't disturb them because they're afraid they'll get fair, bad luck. The, if you, if you disturb the, the fair fort the ferry's gonna come after you , or if you could, or if you cut down a tree, a lone tree. Lone trees that grow in the middle of fields that don't have a, a woodland beside them, just singular trees. These are known as fairy trees and it's bad luck to cut them down. But I feel like these folk beliefs help preserve the past as well, because, you know, farmers who don't have this belief, they don't have any problem tearing down fray, forts and that kind of thing. They just see it as a, something in the way of them farming, especially in the kind of age of industrial agriculture. Yeah. So it just made, that was when I started to think about how important it is to keep folk belief alive. And I've really, and I really started to study Irish folk belief after that point. And I lived in South Korea as I mentioned. I met my wife there, she's from Iowa and she was also teaching in, in South Korea, and we moved to Vietnam after that. And we lived there for a couple of years, and I might come back to that later. But fast forwarding, we moved to Iowa then in 2013, and I'm teaching a course in Irish. At a local community college, but I always start with this poem by Shama Heini Boland. And I just wanted to read two extracts from it. So the first stands out is we have no prairies to slice a big sun at evening everywhere. The eye concedes to encroaching. And then moving downwards. Our pioneers keep striking inwards and downwards. Every layer they strip, they, every layer they strip seems camped on before. So I, I started with that initially, kind of trying to, as, it was almost like a gateway for my students to kind of look at. Look at Iowa with its historic prairies, which don't really exist anymore. It's all farmland. There's very little prairie land left. I think maybe 2% of the state is prairie. But that idea, that idea of our pioneers strike downwards, and I've been thinking about that a lot as well, that that's kind of a, a colonial look at the land because this land, the American land has is just as camped. As Ireland, and I've been kind of experiencing that more and more. I have a friend who's an archeologist here and just hearing them talk about the kinds of fines that they have. You know, we lived in a town where there was a Native American fishing weir was a couple of hundred years old. It you could kind of see the remains, but it mostly washed away by the time we had. But I did see an old postcard of it from the seventies, and you could see it very clearly. And so just make, and then we always it's become a ritual every every autumn, we go up to northeast Iowa to these, to these effigy mounds, which are some Native American mounds up there on a bluff, just overlooking the miss. Mark: Hmm. Michael: And that's really amazing to look at that and experience and experience that. And you know, I'd love to go back, unfortunately, Shamus, he died more than 10 years ago now, but I'd love to go back and ask him if he would consider rewriting that line, you know, because this land is just as a count on Yucca: Mm-hmm. Michael: and I'm trying to, trying to make sense of that and what it means. As an Irish person living in America, Yucca: Mm. Michael: Cuz we, Irish people are victims of col colonialism,  Mark: Hmm.  Michael: Irish people, when they moved to America, they just became white as well and had the same colonial attitudes as everybody. And I'm trying to kind of, but you know, there's, there's, there's kind of stories of reciprocation as well. Where during the famine, the Irish famine the, I think, I believe it was the Chota Nation sent Emin relief to the AR to Ireland. Even though they didn't have much themselves, they still saw this. People in need across the water and they sent money to help. And, you know, there's that connection between the Chta nation and the Irish has continued to this day. But I am just trying to figure out what it means to be an Irish person and a pagan living in this country. And that's kind of where I, where I am right now. But to get back to how I got into Ethiopia, paganism I mentioned earlier that I was really into the Wickerman and I found this group called Folk folk Horror Revival on Facebook. And somebody one day mentioned that there was this group called Atheopagan. And so I decided to join and I found a lot of like-minded people. And I've been kind of involved in the community for, for, I think that was maybe 2018. Mark: Mm-hmm. Michael: And I've been involved in the community since then and maybe on a bigger, I've been much more involved since Covid started and we started doing our Saturday mixers. And I think I've made maybe 90% of those Mark: something Michael: and we've, yeah, and we've been doing that for the last three years and it's just been. It's a really amazing, it's one of the highlights of my week to spend time with with other people in that, in that hour and 45 minutes that we spend every Saturday. Mark: Mm. Michael: Mm-hmm. Mark: Yeah, I, I really agree with you. That's, I, it's a highlight of my week as well. Such warm, thoughtful people and so diverse and living in so many different places. It's yeah, it's just a really good thing to do on a Saturday morning for me. And. We'll probably get into this more a little bit later, but the idea of creating human connection and community building I know is really important to you and it's really important to me too. I think there have been other sort of naturalistic, pagan traditions that have been created by people, but they just kind of plunked them on the internet and let them sit. And to me it's. That would be fine if I were just gonna do this by myself. But when other people started saying, I like this, I want to do this too. To me that meant, well then we should all do it together. Right? Let's, let's build a community and support one another in doing this. And so the Saturday mixers, when we, when Covid started, I think. I mean, to be honest, COVID did some great things for the Ethiopia, pagan community.  Yucca: Yeah. Mark: yeah. Kind of accidentally, but that's, that's Yucca: Well that's the silver linings, right? That's one of the things we, you know, life goes on. We have to find the, the, the benefits and the good things, even in the challenging times. Mark: Mm-hmm. Mm-hmm.  Michael: yeah. I think. I'm just thinking back to when we started. So it's kind of, we have maybe six or seven regulars who come to every meeting maybe. And then we have other people who join now and then, but I'm just trying to think back to the first meeting. I think we, that's when the idea of doing virtual ritual began as well in that first meeting. And we were trying to figure out how to do.  Yucca: Was that was the first meeting before Covid or was it as a response to Covid? Mark: You know, honestly, I don't remember. I think it must have been in response to Covid because everybody was shut in and, you know, everybody was kind of starving for human contact. Michael: I think the first one may have been March or April. 2020, Yucca: Okay, so right there at the. Michael: Yeah, right at the beginning. Yeah. And I think, I remember in the first meeting we were talking about ritual ideas and I think the first suggestion I came up with was like I'd love to somebody do like a, describe what an atheopagan temple might look. Mark: Oh yeah. Michael: Yeah. And I left, and I think you were recording the meetings at that time, but we don't record 'em anymore, just so people can feel free to be themselves and not have a recorded recording of themselves out there, . But I know that, I think James who you interviewed recently he, he was listening to that one, I believe, and he came the next week and actually had prepared a guided meditation. Of what a pagan temple would be like to him. And it was a walk through nature. I think that was the first, our first online ritual together. Mark: Yeah, I remember that now. Yeah, and it's been, it's really been a journey trying to figure out how, how can you do these ritual things over a, a video conferencing platform. In a way that makes everybody feel like they're participating and engaged. Right. So that there's a, a transformation of consciousness. But I think we've done pretty well, to be honest. I mean, some of the rituals that we've done have been really quite moving. Michael: Yeah. And I think the ritual framework that you've worked at translates very well to. A Zoom conference as well. I dunno if maybe, if he wants to describe that, what the usual atheopagan ritual would look like. Mark: Sure. We've, we've talked about this before. The, the, the ritual structure that I proposed in my book is basically a, a five step process where the first is arrival, which is sort of, Transitioning into the ritual state of mind from the ordinary state of mind, and then the invocation of qualities that are a part that we'd like to be a part of the ritual with us, which is sort of the equivalent in Wicca or other pagan traditions of invoking spirits or gods or what have you, ancestors, what have you. And then the main working of the ritual, which varies depending on what the purpose of the ritual is. But it can be, well, we've done lots of different kinds of things. We've braided ribbons and then tied, not tied magical knots in them. We've made siles, we've we've done just lots of different kinds of things. And then gratitude expressions of gratitude. The things that we're grateful for. And then finally, benediction, which is sort of the closing of the ritual at a declaration that we're moving back into ordinary time. Yucca: So how does that look in, in a meeting, like a Zoom meeting In a digital format? Mark: Michael, you want to take that one or should I? Michael: So you know, you have maybe, I think usually when we have a ritual more people attend that and so we might have 12 people there and often  Yucca: cameras on. Michael: Camera's on. Well, it's optional. Yeah. If you don't feel comfortable having your camera on, that's completely fine and you don't even have to speak. We do encourage people just to you know, leave a message in the chat so you can just listen in. You can engage as much or as little as you want. And you, you, so. We have all the people on in the conference, and maybe we'll try and get some more of the senses involved as well. So sometimes we'll like candles and everybody will have a candle in front of them. I do know for for some of our sound rituals. Mark, you've used two cameras where you, you aim one camera at maybe a focus, like what's one of the examples of that that you. Mark: Well we did that both at Sown and at Yu. So both the Halls ritual and the Yule ritual where I would create a focus or alter setup with thematic and symbolic things relating to the season. and then I would point, I would log into Zoom with my phone and point my phone at that. And then, and then I'd log in separately on my laptop for myself as a person, and then I could spotlight the focus so that it's kind of the centerpiece of what everybody experiences on their screen and sets the atmosphere. Michael: Yeah. So just a virtual focus that everybody can, everybody can virtually gather around. Yucca: Mm-hmm. Michael: Yeah. And I think we've also used a Pinterest board in the past as well for people. I think it was at Sound again, we had that Pinterest board where people could put up notes about. Their ancestors or loved ones that they were That's correct, isn't it? Mark: Yeah. Yeah. Or pictures of people that had passed recently or. Yucca: mm. Michael: yeah. So yeah, there's a lot of digital space that you can use for this ritual. We also try not to involve too many props as well. Because we wanna make it as easy as possible for people of all abilities. And just if you don't have the space for something, for a large proper if you don't wanna make a lot of noise, you know, we're not gonna have you using chimes or things like that. So we try and make it as easy as possible. Sometimes we do invite you to bring some food to eat as well, because, you know, a lot of these are feasting rituals. So we maybe, if you feel comfortable bringing some refreshments, you might want to do. And just have a friendly meal with people online. For example, we're actually gonna start doing I'm gonna be leading full Moon meals every month on the, on the, so the first one's gonna be December 7th. And I'll post, post about that on Discord, and I think Mark will post about that in the Facebook group. Yeah. And so the idea is everybody just comes. Joins the Zoom meeting and everybody should have their meal. Whether you're, whether that's lunch or if you're in a different time zone, maybe there'll be dinner or maybe it's just a snack. And then we'll spend a minute just thinking about the providence of the food and then we'll eat us and maybe people can talk about the food that they're eating and what it means to. And I'm hoping to make that a monthly event that we meet every full moon to share a meal together Mark: That sounds. I, I, I really I have pagan guilt over how little I pay attention to the full moon. I'm, I'm always, I'm always aware of what phase the moon is in, but I, I don't do a lot in the way of observances of the phases of the moon. And so, I'm excited to have this added in to something that I can attend. Michael: Mm-hmm. . But yeah, as you can see from that format, it's very simple. And again, you, if, if people listening would like to attend as well, there's no obligation to keep your. Your camera on, there's no obligation to speak. You just, you can just listen in and just feel part of the, part of the community that way. Yucca: Mm-hmm. So in the mixers sometimes ritual, are there discussions or what else do the mixers. Michael: Usually the mixer is kind of a freeform thing. Yucca: Mm-hmm. Michael: Maybe we'll have a topic sometimes, but usually people just come and do a check in and talk about how they're, how they're getting on that week and if there's anything they wanna discuss, we just open it up to that. Depending on the size of the turn, we may require some kind of etiquette stuff. So if there are a lot of people and we don't want people to. Shut it down or have spoken over. So we'll ask people to raise their hands if they wanna speak. That's, that really is only when there's a lot of people and, and often I, I know I'm somebody who likes to talk, so it's a, I think raising hands also gives people who are less confident, or, I'm sorry, not less confident, just not at, don't feel like interrupting. It gives them an opportu. To to have their say as well and be called on mm-hmm. Mark: Yeah. Yucca: Mm. Mark: I think it's really good that we've implemented that. It, it's, it helps. Michael: Mm-hmm. I think one of the really cool rituals we had recently was for like the ATO Harvest, so that was when was that? That was in September or October. In September, yeah. Yeah. So. We were trying, I mean, usually it's, you could do some kind of harvest related and I think we've done that in the past. But I have a book called Celebrating Irish Festivals by Ruth Marshall. And this is my go-to book for, for, for ritual ideas. And this is, and I like to. Kind of some of the traditional holidays and maybe just steal from them. . So Michael Mass is is the holiday around that time in Ireland? It's a Christian holiday, but it's also it's a  Yucca: were older. Michael: yeah, yeah, Yucca: Christians took for the older Michael: yeah, yeah, yeah. you know, it's about St. And he's known for slaying a dragon as just as St. George was known for slaying a dragon. But I thought, well, let's turn this on this head and let's celebrate our inner dragons. Let's bring our dragons to life. So it was the whole ritual was about dragons. And we actually drew Dragons, drew our inner dragons and shared them. Talked about what they. And kind of we were feeding our inner dragon so that they could warm us throughout the coming winter. Yucca: Hmm. Michael: Mm-hmm. Mark: as well as watching the home. Star Runner Strong Door, the Ator video, Michael: Oh yeah, Mark: which you, you have to do if you've got dragons as a theme. It's just too funny to avoid. Michael: That's an old flash cartoon from the early two thousands. That was pretty popular. Mark: Mm-hmm. Michael: Yeah. Track toward the ator. Google it, and in fact, I did a, I did the hot chip challenge as part of that ritual as  Mark: That's right. Yeah.  Michael: where I ate a very, very hot tortilla chip on camera. And. It was it was painful, but I'm sure, I don't know if it entertained other people, but it was, it was fun Mark: Oh yeah. It was fun. Michael: So, yeah, they're like, I mean, these rituals aren't all, they're, they're fun and they're kind of silly and goofy and but I mean, I thought at the same time they're very meaningful because people really opened up in that one  Mark: Yeah.  Michael: and shared some really profe profound truth. That was one of my favorites actually, and I hope we do another, another dragon invoking ritual in the future. Mark: Maybe in the spring Michael: yeah. Mark: you do it at, at both of the equinoxes. Michael: Mm-hmm. Mark: so you've joined the Atheopagan Society Council, which is great. Thank you so much for your, your volunteering and your effort. What do you think about the future? How do you, how do you see where this community is going and what would you like to see? What's, what's your perspective on that? Michael: Yeah, so just before I discovered the Pagan Facebook group I had attended A local cups meeting. So that's the covenant of Unitarian Universalist Pagans. And so it was just a taro reading workshop and, you know, I was, I, I like kind of using these kind of rituals just for their beauty and, but not, for not, not seeing anything supernatural in them. I was, it was amazing to, to find a group that was interested in these kind of things too, but without the they weren't incredulous. So I guess what I'm hoping for is that as we, as we kind of find more people who are, are, are aligned with us, maybe we can have more in. Experiences. That was one of the great, the great highlights of, of last year was attending the Century retreat and meeting all, all these amazing people in real life and being able to spend time together in real life. And I hope that as we kind of, as the word gets out about this group, more and more of us can meet in person or as we are able to, Mark: Mm-hmm. Michael: That's what I really hope for the future that you're finding your, your people that we are, we are being able to get these local groups together and then spend time on these important days of the year. And I believe the Chicago Afu Pagan group was able to do that not too long ago. And I know Mark, your local group meets quite regularly as well. Mark: We, we meet for the, for the eight holidays, for the eight Sabbath. So yeah, we're gonna get together on the 18th of December and burn a fire in the fire pit and do a, a ritual and enjoy food and drink with one another. And yeah, it's a, it's a really good feeling that that feeling of getting together is just You can't replace it with online connection, but online connection is still really good. So that's why, that's why we continue to do the mixers every Saturday. And Glen Gordon has also been organizing a mixer on Thursday evenings. Well evenings if you're in the Americas. And. Yeah, there's just, there's, there's a bunch of different opportunities to plug in and it's always great to see somebody new. Michael: Yeah, I think that would be another hope as well that, you know, if you've been on the fence about coming to a mixer I hope that what we've described today maybe entices you to come along. You know that there's no expectations and you can, you can share, you can just sit in the background and watch, or you can participate. There's no expectations and it's just a nice way to, to connect with people, so, Yucca: how would somebody join in? They find the, the link on the Facebook discord. Michael: that's right. Yeah. So I think, mark, you post it regularly on the Facebook group, and it's also posted on the disc. As well. So, and it's the same time every Saturday, so it's 12:15 PM Central for me, so, and that's like 1115 for you, mark, on the, Mark: No, it's 1115 for Yucca. Michael: Oh, okay. Mark: It's 10 15 for me. Michael: Okay. Okay. Yucca: one 15 for Eastern. Then  Michael: one, yeah, that's right. Yeah. Yucca: Hmm Mark: And. Michael: and it's always the same time, and I think we've, I think we've only missed one week, maybe in the last three years. Mark: Yeah, I think that's right. I wasn't available and I couldn't find somebody else to host or something like that, but yeah, it's been very consistent. And I see no reason to think it isn't gonna keep being consistent. But yeah, we, you know, we welcome new people. And if you're not in the Americas, that's fine too. We've got a couple of Dutch people that come in all the time. There's a, an Austrian woman who lives in Helsinki who participates. So Yucca: E eight nine ish kind of for Europe, Mark: Yeah.  Michael: Yeah, yeah. Yeah. We've even had on the Thursday night mixer, we've even had Australians join occasionally too. So Yucca: That sounds like that'd be early for them then, right?  Michael: yeah,  Yucca: getting up in the. Michael: Mm-hmm. . Yeah. But I'd I'd love for some of the listeners to come and join us on one of the mixers and then cuz you know, you bring new ideas. And I we're always looking for new ritual ideas, Mark: Mm. Michael: That kind of bring meaning to our lives and to everybody else's. Mark: Mm-hmm. Yeah, cuz that's, I mean, that's what we're doing, right? We're, we're create, we're, it's a creative process for us. We've got these sort of frameworks like the Wheel of the Year and the, the ritual format that I laid out. Although people can use other ritual formats too. That's fine. But it's, it's an ongoing process of creation and of taking some old traditions and folding them in where they fit but creating new stuff as well. One of the innovations that we, that we've been doing for the l past year or so is if people want to be done with something, if they want to be finished with something in their. They can write it in the chat and then I take the chat file and I print it on my printer and I take it and I burn it in my cauldron. So it is actually being burnt physically. But it just takes a little bit of technical processing before that happens. Yucca: Hmm. Mark: And it's those kinds of innovations that are really useful for online rituals. And boy, if you have new ideas about things we can do for online rituals, I, I would love to hear 'em. Yucca: So thank you so much for sharing your story and your visions or the future with us. This has been, it's, it's really been beautiful to hear and to get that insight. Thank you, Michael. Michael: Well, thank you for having me on. Yucca: Yeah. Mark: It's been delightful hearing from you and, and I, I gotta say, I, I feel like our community is very lucky. You've been exploring religion and and folklore and ritual for a long time in a lot of different frameworks and I feel really fortunate that you've landed with us cuz I like you so. Michael: Okay. Well thanks very much. I like you too, Mark: Okay folks, that'll be all for this week. And as always, we'll have another episode for you next week on the Wonder Science Based Paganism. Have a great week. Yucca: Thanks everybody.  

Super Serious 616
Episode 184: Not by the Charity of the Butcher (Strange Tales #130) -- March 1965

Super Serious 616

Play Episode Listen Later Nov 17, 2022 16:14


In this episode:Mike and Ed discuss whether the Fantastic Four or the Beatles are more famous. The Thing and the Human Torch were recently at a Beatles show and did some damage while capturing thieves who targeted the cashboxes. Who should pay for that damage? Should good samaritans like the Fantastic Four be held responsible? If they are, what type of disincentive does that create for other superheroes to help others? Are there more superpowered people out there who are keeping their abilities secret because they can't afford the insurance?Behind the issue:The Beatles are first mentioned in the Marvel Universe in Fantastic Four #34 (two months prior to this issue's release), but this is the first appearance of the actual band. The Beatles' first comic book appearance was a few months earlier in July 1964 when Dell Giant released a special issue focused on the fabulous foursome. A few days after the Dell book hit the stands, an Archie title also mentioned the Beatles (Archie's Girls Betty and Veronica #105) and the girls shopped for wigs, but the actual musicians did not appear. Perhaps the very first appearance was in the aforementioned Archie series #104, which teased the following issue and had a page of text explaining who the Beatles were (see below). The Beatles are mentioned in Marvel Comics a number of times through the years, but, as far as we are aware, they do not appear again until 2007, when it is revealed that the band had been kidnapped years ago and had been replaced by Skrulls (who were responsible for the majority of their music in the Marvel Universe).In this issue:The Thing and the Human Torch are getting under each others' skin, and likely need a break from each other. No such luck, as their girlfriends convince them to go see the breakout sensation from Britain, the Beatles. The foursome head to the show, but before it begins, they learn that the venue's payroll has been stolen. The Thing and the Torch head out and capture the criminals, but unfortunately miss the entire show.Assumed before the next episode:People are more interested in being entertained by the Beatles than being saved by the Fantastic Four, or so we assumeThis episode takes place:After the Beatles have started their British Invasion!Full transcript:Edward: Mike, who is more popular? The Beatles or the Fantastic Four ?Michael: I think if you listen to our show regularly, you would assume the Fantastic Four. But if you lived in the real world you'd probably say The Beatles people meaning it for a reason, right?Edward: Fantastic Four have clubs, fan clubs, but there's no fantastic mania. How even the four mania how would you even say that?Michael: Yeah, I don't know ff mania, but like, you know, there's, I thinkEdward: we don't swear on the show, Mike. No swearing on the show.Michael: Yeah, . Well, they're certainly popular. They're incredibly popular and they're being followed and there's celebrity magazines that report on them, but, Nothing like the Beatles. Nothing like The Beatles has happened in a superhero superpowered world. Yeah.Edward: And in this particular case, we had the Fantastic Four went to go and see a Beatles show and we've had no incidences, we know about where the Beatles have gone to see a Fantastic four show.Michael: No, they're not showing up the Baxter Building, you know, pen and paper hand asking for autographs. Although, funny about it is maybe it's just a comment on human nature or our society, but like the Fantastic Floor have saved the world more than once.Edward: And Beatles, the Beatles have not, Beatles have never saved the world.Michael: So you think, you'd think that if there's gonna be this adulation, idolatry, of anyone, it would be the fantastic for, but no, it definitely isn't. It definitely is not. The Beatles are far more popular.Edward: Yeah. The, I guess the Beatles have saved music.Michael: Okay, we'll go with that. They definitely struck a nerve in our society and they're making their mark. And so time will tell us whether the Beatles will be remembered. But right now it's hard to avoid them. If you're trying to avoid them, they're everywhere.Edward: There's that question too, a thousand years from. Looking far, very, very far in the future, are we gonna remember the Fantastic four of the Beatles and I think it would be the Fantastic four, the first real superheroes on the planet are I imagine more memorable than any music bandMichael: the Fantastic four are, as we chronicled or the vanguard of this new evolution of almost post humanity then this is a moment in our history, where there's, who knows where we're going to evolve to. So my money would be that the Beatles are a flash in the pan and the Fantastic four are here to stayEdward: and interesting there's four of each of them. I think that's a coincidence?Michael: Oh my, I didn't think about that. So do you think that maybe, do you think that there's a matching principle going on here, we noted in, remember we talked about recently with the frightful four, there's four of them and we're just confused as to why they would limit them.Why wouldn't they be like the hateful eight or something. But instead it's like they pick the four and the beetles are quarted as well. So do you think. Are we? Are the Beatles being influenced by the Fantastic Four? Is music being influenced by superhero culture?Edward: Yeah, maybe. Or maybe the other way around. Maybe the Fantastic Four just search out for groups of four things.Michael: Yeah.Edward: They go to the grocery store and be like, yeah, I know you have a dozen eggs, but do you have like a smaller package, like maybe a third the size?Michael: Or maybe. Or maybe it's just. Things come into four, right? There's the four of food groups, there's four seasons. It kinda just naturally would evolve to where the Fantastic four, who, when you really think about their powers are quite elemental in nature. They have this sort of,Edward: there's four elements. There you go.Michael: There's four elements. Yeah. So maybe there's an inherent connection to the idea of having teams of four. Although maybe I'm just spinning some mirror here. But anyways,Edward: Can you match them? Can you look at the, we talked about this before, the frightful four. There's like a match almost between, Medusa had her stretchy hair. Mr. Fantastic Reed, Richards could stretch his body. There was kind of a rough match betweenMichael: mm-hmm.Edward: the Frightful Four and the Fantastic Four. Can we do the same thing with the Beatles, is there does Paul match to Sue? Like what is the match? The Four Beatles and the four Fantastic. Four.Michael: You know, I just don't know enough about 'em but maybe there might be something there. Maybe that's something that if they stick around, we can we'll explore it a little more and look, maybe they're the first. Maybe the Beatles were the first super. Powered band. Maybe we're gonna find out that they have powers too. Just don't know about, we just know, knowEdward: IF it happens to anybody, it'll happen to the Beatles. I think a couple things to talk about. I think with this encounter with the Beatles and the Fantastic Four, well, I guess the Fantastic Half, the Fantastic four, it was The Thing in the Human. Torch were going to see a show and in the process, I guess someone tried to steal all the money from the show andMichael: mm-hmm.Edward: the Fantastic Four prevented that. So I guess they did, they did their good deed for the day. But in the process of doing that good deed, they did some damage and. I think this is interesting is that the damage that they caused is not being paid for by the theater, not being paid for by the Beatles, not being paid for by the government, not even being paid for by an insurance company. The fantastic for themselves are gonna cover that damage. And I think that's just, it's interesting that it wasn't like The Thing and the Human Torch were being professionally employed by anybody. They went out of their way to help the Beatles or to help the theater anyway with these thieves, and now because of that good deed, they're gonna have to pay. They're taking the money outta their own pocket, and that doesn't seem,Michael: It doesn't, and it, but it's interesting. It probably, it gives us some insight into the institutional nature of the, or at least the institutional connection between the Fantastic Four the society that they live in. So we've talked before about how the Avengers seem to have a pretty direct connection, almost be a separate like military force or arm of the armed forces in America. But the Fantastic Four haven't. You think that Fantastic Four has some kind of formal relationship. As being almost a police force that they would. They'd have an immunity from any kind of possible civil liability or prosecution if they're,Edward: are you saying that they are a police force or they should be a police force?Michael: I'm saying that they aren't, because if they were then if they're acting in the course of their duties, then they would have an immunity from prosecution and civil liability to provide that they were still carry of their duties within their own responsibility. And so then they wouldn't care about paying the damage themselves because if they got sued, they have an insurance policy, they would respond. And they're not, they won't be worried about, say, being arrested for the damage that they caused in the course of exercising their duties.Edward: And that's, I was gonna say that's probably true. If when the US military went and asked the Fantastic four to go and take down the Hulk, they were basically working under the under the authority of the US military, and I'm assuming that any damage caused during that battle with the huk was paid for by the US government, by the military. In this case nobody asked Ben and Johney to go and stop the thieves. They just, they were good Samaritans and they went and did it. That changes the calculation a little bit.Michael: It does up that. I think when they're tasked by the American military, I think that they could be considered to be contractors in that role. But I am saying that here, that they just acted as good Samaritans and did a public good. They acted as if they were, police officers. But the fact that they paid outta pocket tells me that they don't have any kind of special protection or immunity from prosecution or from civil liability. So they did, then they wouldn't have reached into their own pocket. But the fact they reach into their own pocket tells me that they're doing the analysis, which is that it's probably better for us just to pay outta pocket than to get sued by the people that owned the buildings that were damaged or anyone that had a possible liability claim.It's probably just worth their time to pay it out. So they must have number one tons of money. And number two they don't have any kind of protection. So number three, they're gonna use their money to avoid getting sued and have their time being eaten up. It's just worth their time to just pay people rather than having a claim against them.Edward: But I guess why are they doing it at all? So basically these thieves came in, they stole the money, they took off if Ben and Johney just said, oh, you know what, that's not our problem. We're gonna go sit and watch the show.Michael: Mm-hmm. ,Edward: Then number one, they get to see the show, and number two is they're only out of the ticket price. Instead, they went and chased these guys down. They didn't get to see the show, and they had not having to pay a bunch of money outta their pocket. What was the incentive for them to do that?Michael: That's The Thing, right? If there was a, they had immunity from a civil lawsuit, then they would go do it. But here they clearly don't. And so they had to pay out of pocket because they're involved in this incident that caused damage and they pay out pocket cuz it's easier for them to make the claim go away, the potential gifts go away. And I don't know what their incentive is other than to do that other than that they're heroic or because they feel they can solve the problem and they have so much money that it's worth it for them to both be heroic and to also make sure that they don't have their time wasted that they're, after you keep against them,Edward: you keep saying they have so much money. Is that true?Michael: They'd have to, otherwise they wouldn't do it. If they didn't why would they pay out of pocket? Why would they wait and get sued? I guess.Edward: I guess that's my question. So where's that money coming from? I guess they had that one movie that they had a while back. And Reed has some inventions that he's invented. He lost all his inventions that he invented in the past due to that bankruptcy. But he presumably he's invented other things since then but it doesn't seem that that's an unlimited fund of money. I just, I think there's a, from my business world. One of the heroes of the business world was Adam Smith, who invented the whole idea the trade is good. And one of his famous quotes was, it's not the benevolence of the butcher, the baker, or the brewer that we expect our dinner, but it's regards to their self interest. We don't count on the butchers and the bakers to give us their foods for free. Why are we counting on superheroes to do all of their work for free?Michael: We're missing some information then, right? Because it's clearly happening. So number one, the Fantastic Four don't have this protection from being suit for damage that they cause in the course of acting heroically because they're paying out pocket, because that's the only reason that you would pay outta pocket. So why would they continue? Why would they do it?Edward: So let me dive into that cause it's exactly right. It sounds like of there's an incentive to be a butcher, there's an incentive to be a baker.Michael: Mm-hmm.Edward: society incentivizes people to be police officers and salesmen and retail clerks and radio personalities like us, there's all sorts of incentives in the system for these things. It sounds like right now there's a disincentive to be a superhero, and so that's what, okay, go ahead.Michael: I was gonna say that, but that's where I think this is going is that. On its face it doesn't make any sense unless they have so much money and how are they getting so much money? I don't know. Perhaps it's that we are talking about the Fantastic four who have access to space travel and interdimensional travel, right? Based on their recent adventures to our knowledge.Edward: They're just stealing from other dimensions and bringing,Michael: I don't, yeah, I don't know. I do not know if they have access to resources or minerals or something that we don't have access to here and that we're just not made aware of it. Or Reed has been inventing things and selling and profiting off of that.Edward: Yeah. So I guess that could be it, right? So you could be Right. Maybe they're just obscenely wealthy and in order to keep that wealth, in order to keep getting access to these other dimensions and keep the government off their back, they go and do good deeds for good public relations and those good deeds cost them money. But in the same way that, I dunno, Proctor and Gamble donates to clean water in Kenya, they're just like going like they're, it's like the tax on them. The good deed tax is there to keep their good PR so that they can go and make their money some other way that we don't really know.Michael: Yeah but on a personal level I work as a lawyer, so I make my money by going to work and billing and I bill my time. And so if I'm walking to work and I see someone's gonna walk into traffic and I'm gonna stop them because that's a normal human thing to do and it, but on a cost benefit, I guess it costs me time so therefore it costs me money. Cause I don't get to go to work early enough. But, It's on a human level it's what you wanna do. Now if it's now if to save, if I saw someone fall into traffic and for me to save them would require me to, you know, run.Edward: You don't want to skuff your shoes.Michael: No, but if I could lose my life, then I think that it might be more, I'd hope I'd be heroic and chance losing my life to save somebody who's falling into traffic but I don't know, maybe that's where there would be a line. And what I'm saying is that the fantastic core haven't hit that line yet. Yeah, it's still worth their time.Edward: Let's going back to this scenario, it's even worse than that. It's imagine if now you go and you save that guy, he falls down the road and you rush into the road and you save him but in so doing so, you cause a car to swerve and hit another car. And so now they wanna fine you for that car accident because you jumped in the way to save that dude. That doesn't seem right either. It's one thing you've already risked your life, you've already taken your time. Now we're gonna say, Hey, oh, and by the way, now we want your money too.Michael: That analysis only works, that analogy only works, is that I said, whoa, whoa, whoa, whoa, whoa. Okay, hold on a second. Let me pay for everything outta my own pocket. But I have an insurance policy that would respond to it. So likely I'm gonna be okay. So even if I did that quick math in my head, is it worth it for me to go in traffic?Edward: Yeah. But should your insurance company be paying for that? The guy who busted his car up again, not, not his fault, maybe the guy who felt that in traffic, you go after him, but going after the insurance company of the guy who saved the person's life, that doesn't seem right,Michael: It doesn't work like that though. If somebody falls into traffic and I go in and try to save them, as a result, some other car gets into an accident. I guess if they sustained injury, they would sue me. They wouldn't Sue the insurance company. My insurance company would respond on behalf of me. And there are some legitimate legal defenses that would apply to that very scenario where it's there. I didn't do anything wrong. I wasn't negligent. They'd have to establish negligence in order to trigger it. But my point was less about the intricacies of motor vehicle law and claims, and more just to say that my analysis is not gonna be influenced. I wouldn't have to think I take into my pocket and pay this person out rather than pay my deductible so that when I got sued, that my insurance company would respond and defend me. Whereas the Fantastic Four, clearly it's just not worth it for them to. To possibly don't have insurance, which I don't think they do to respond to the claims that would be made them damaging thatEdward: if they did their insurance would be so high ,Michael: they'd be so high.Edward: What insurance?Michael: You're an orange, rocky, monster that could destroy a building. So I think the insurance would be quite high if you had it. But at the same time, they could sued personally. The, Thing would have to, he is paying outta pocket. They must have so much money that it's just like there's, they're not even thinking about being tied up in a potential lawsuit later because so much doughEdward: and so clearly all these disincentives that we're creating haven't stopped the Fantastic Four from existing. But what's I always find interesting is when these disincentives exist, we have to ask what isn't happening because of these disincentives. Are there lots and lots of other superheroes out there that are being like, you know what, I don't wanna be a superhero. Look how much it's gonna cost. It's too expensive to be a superhero, like being a lawyer. I'll just be a lawyer by day and a nothing by night because it's too expensive.Michael: Well, I'm not, nothing by night a cause you know that.No that's why Spider-Man wears a mask. We've been quite critical on Spider-Man, how he wears a mask and doesn't reveal his identity would be super critical of him.Edward: And it's not, it's not afraid of a villain's attacking him. It's not because he's wants to do criminal things. It's because he's not super rich. Everyone who's not super rich wants to be a superhero, has to cover their face.Michael: So maybe, so I think the solution would be if we recognize it being a superhero is public good, much like having volunteer firefighters and police officers and things like that, then there needs to be new legislation passed in order to provide some immunity from civil prosecution civil claims, if he did, it would remove that disincentive if The Thing and the Torch burned down a building or destroy a building, the building owner can't sue them because they were legitimately acting the course of their superhero duties and roles, then I guess I had to put a claim over to their insurance company. But what would, and I think the only way that works is that probably all of our insurance rates are gonna rise to accommodate that but it's pretty fair to spread their risk out of superhero related damageEdward: It does. And then what that should open up is all these other superheroes that are presumably hiding right now and aren't doing anything. Or have they have secret identities or they have no identities at all because they're not super, they're just, well, they're super, but not heroes. If you wanna take, if you want more of your supers to be heroes, fix the insurance laws.Michael: No fix. You know what we need to have, there? Have to be local, state level and federal legislation that's passed in order to have, immunity from prosecution and immunity from civil claims pass. And that the question for us, I guess as a society, is that a better way to go? Or is it better to have them running around with masks and I don't know. I used to be pretty anti masked, but now I'm kind of seeing the value of it.Edward: Yeah. I think these laws, when you create these new laws, don't they have like catchy names and stuff too?Can we call this law the put the hero back in supers?Michael: I like where you're going with this, but what it be like, there's no i n team, but there's I Insurance Act from 1965. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.superserious616.com

Super Serious 616
Episode 183: The Most Elite Engagement Party (Fantastic Four #36) -- March 1964

Super Serious 616

Play Episode Listen Later Nov 9, 2022 6:03


In this episode:Mike and Ed discuss Reed and Sue's engagement party. Why were only superheroes invited? Was there another non-superpowered person party that was kept secret? Also: the Wizard has recruited Paste Pot Pete, Sandman and Medusa to become the “Frightful Four”. Why did he stop with four villains? If he really wanted to defeat the Fantastic Four, he should have created the Terrible Twelve or the Amazing Eighteen. Why are the villains fighting fair? At least they waited until the party was over.Behind the issue:This is the first appearance of Medusa, who is clearly tied to Greek Mythology at this point. Later she will be retroactively changed to being the noble Queen of the Inhumans, but there is no sign of that at this point.In this issue:The media are abuzz, and falling over themselves, with the news of Reed and Sue's engagement. Meanwhile, the Wizard has gathered together three other super-powered people to create his own Frightful Four - the Sandman and Paste Pot Pete, who happened to be flying by the Wizard as he floated through the atmosphere weightlessly after his last misadventure, and Medusa. The newly formed Frightful Four attack the Fantastic Four at their headquarters after Reed and Sue's engagement party (which was full of superheroes) and nearly defeat them, although they are ultimately defeated, with the Frightful Four mysteriously disappearing from the fray.Assumed before the next episode:People are more interested in who attended the party than the FF's battle with the other FF.This episode takes place:After the Fantastic Four have seemingly defeated their apparently evil counterparts.Full transcript:Edward: I don't think any journalists were invited to this engagement party. Mike, did you get an invitation?Michael: No, and I was looking for it. But sadly, no.Edward: Reed Richards and Sue Storm are now officially engaged. I think they were unofficially engaged before, but now this is like a, kinda like they're coming out big party and a big, big giant celebration at the Baxter building.And, well I say big, but it was probably more intimate in that it was really only other superheroes that were invited to this party.Michael: It's sort of funny you'd think that they would've parlay, I mean, the superheroes, like the Fantastic Four are the most celebrity focused kind of superhero, I think the most media friendly superheroes.You'd think that that would lead to them parlaying that celebrity into connecting with other celebrities outside of their particular field. Because you look at Hollywood parties, it's not necessarily that rock musicians only hang out with rock musicians when they throw parties. All forms of entertainment types seem to gather. So it's sort of funny that superheroes only invite superheroes for their big party.Edward: Seems that's even weirder than that. You think about if, Reed and Sue, presumably like they've not been superheroes for that long, we're talking about a few years now, four years, did they not have any friends or family from prior to them being superheroes that, maybe would wanna invite to their party? This engagement party was such a publicity event okay, so some rockstar gets, I'm sure like celebrities know celebrities and some rockstar gets married to some other rockstar. They invite a lot of rock stars, but presumably they also invite their brother and their I don't know, their, friend that they had from when they were a kid. These people have these entourages doesn't look like Reed and Sue do it looks like their only real friends to invite to this party were the X-Men and the Avengers.Michael: Shows they have a complete dissociation to their past life. It just seems odd. Maybe this, actually, I've been thinking about this this whole time.We're talking, what if this is just the public one?Edward: Oh, I see. They're having another oneMichael: This is a celebrity one, right? The photos. That's true because the media we're there. I don't know, maybe let's play it out this way. If you are Sue storm's cousin, would you really want to go where there's all these nosy tabloid photographers because there were a ton there, right?Edward: More than that. We know that every time these superheroes have some public event, they're attacked by super villains and see, do you want, do you want your cousin to show up and be attacked by the wizard?Michael: So maybe what they did here was. Okay. At first I thought was just weird, but now it kind of, it makes a little bit of sense. Okay, we're gonna have this, and we know that the tabloids would rather have a picture of say the Human Torch standing next to Thor. You know what I mean? So we'll have, we'll throw that and that that'll give the tabloid. Reporters and photographers a chance to write their story and take their photographs and that's the public one.And then there's more personal and intimate one that's with their friends who aren't in the game. And that way you don't put them at risk. That's true actually, that makes a lot of sense to me.Edward: Does make a ton of sense. It's interesting cause I say there was only superheroes invited, There were, there were two non superheroes invited to the party. One was Professor Xavier, who's an expert. The mutant genes. And how these mutants are happening. And the second was Bruce Banner, who was the, the guy who saved the world , from the alien invasion a couple years back. So I guess when you, save the world from an alien invasion, you're an honorary superhero.Michael: Yeah. And they didn't care about the safety of those two guys, I guess, . Wow. Well, they're very smart. They can, they can figure, they can respond.Edward: I guess the other thing around safety is , we know that, when Spider-Man shows up at his fan club, they, get attacked. And when Reed Richards goes and talks at his alma mater he gets attacked, but in this case, you had to be a pretty ballsy superhero to go and attack the Fantastic Four and the X Man and the Avengers all in the same place at the same time.Michael: So maybe it could have had Aung Pentunia show up, but I don't know. It doesn't seem to make, I think I can see why they split this up.Edward: It's interesting that I talked about, these, villains attacking, the Baxter Building was attacked by super villains, but I guess they waited until the party was over. Let's wait until Thor vacates the building before we attack Reed Richards.Michael: Smart. They're getting smarter Ed. They're just getting smarter. .Edward: Well, the Wizard is one of the, the smartest, villains. Well, one of the smartest people in the world. Right? He was known as well before he became a villain. He was one of the smartest people in the world didn't, he still hasn't been able to defeat the Fantastic Four using, incredible brilliance.But he has been able to recruit, a more substantial team. He's realized that trying to take them on, on his own is not the way to go. And so now he's recruited, uh, pop. Yeah. How Pace pot. Pot pee., yep. Who he's worked with before, but now he's also recruited the Sandman and this new, super villa villains super villainous, named Medusa, at his side.And so, I guess four on four is probably, better odds. And as far as, as far as we know, it was kind of a stalemate, right? So they, they, they did not successfully hurt the Fantastic Four, but they also escaped fairly unharmed.Michael: Well, yeah. It's interesting though, it seems like the wizards figured out, like you say, he might have stand a better chance if he has a team of his own, but it seems like incredibly personal, his whole purpose of his team seems to be to match up perfectly with the Fantastic four, apparently they're called the Frightful Four , and it's justEdward: He's just trolling them now. He's just trolling them with that.Michael: He's trolling them. Like, I mean, like I, I took issue with, there's been some unimaginative team names, like Fantastic Four is one of them. It just seems like it's aEdward: Terrible trio. Remember the terrible trio?Micheal: Yeah, that's right. But they're just trying to like, No, no, no. I'm not looking about world going for world domination anymore. I'm just doing this because I'm a better, smarter person than read Richards, it seems to be what seems to be what the Wizard's trying to go for itEdward: And clearly getting, getting four of them together is, gives them better odds and trying to take him on like one on four. But it's funny that he can go further. Like why? Why stop at four? And then why even limit yourself with your branding, the Frightful Four? Why not be be like the terrible 12 and that that yeah, your odds are gonna be a lot better.Michael: Yeah, exactly. So maybe, maybe the wizard isn't as smart as he thinks. .Edward: He needs a few more. He needs a few more. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.superserious616.com

Super Serious 616
Now with full transcripts! -- Episode 182: Checks and balances? Betrayal of trust? Faith restored? Our heads are spinning! (Avengers #13 Part 2) -- February 1964

Super Serious 616

Play Episode Listen Later Nov 2, 2022 10:25


We are using a new service to edit these episodes. As part of the process it produces a full transcript. The transcript is not perfect, but it's pretty close! And we think we will get better over time. Transcripts will be included below. Enjoy!In this episode:Mike and Ed discuss the ending of martial law and the innocence of the Avengers. They were framed by Count Nefaria, but the events showed just how poorly the country was prepared for our heroes turning on us. And why were we fooled to begin with? Shouldn't there be some method of double-checking when a hero declares war to make sure it really is the hero? We live in a world of mind control, and magical and technological illusions. Some sort of back-up plan should be in place. Why wasn't it? Also: After causing a national state of emergency, why is Count Nefaria being deported rather than charged with the crimes he committed in this country? Do all Counts get diplomatic immunity? Even when they cause the Avengers to battle the U.S. Air Force?Behind the comic:This is the first appearance of Count Nefaria. He will soon battle the X-Men and Iron Man in a solo outing. Eventually, he dies due to his experiments, but is resurrected to join the Legion of the Unliving. While he never achieved iconic status, he is active in the Marvel Universe to this day.In this issue:The Avengers have successfully stymied American crime, and the Maggia is unhappy about it. Their secret leader is Count Nefaria, the most powerful crime lord on earth. He is also the wealthiest European nobleman. He decides to move to America, having his castle rebuild brick by brick in America. He meets with the Avengers and basically creates holograms of them. He sends thr hologram Avengers into the real world and has them basically declare war on the US. The US responds by declaring the Avengers enemies of the state. This all happens while the Avengers are basically kept in suspended animation. They are released from suspended animation and are attacked by American troops. They respond by battling the armed forces, only to find that they are public enemy number one. The Avengers eventually figure out what has happened and they confront Count Nefaria and defeat him. Count Nefaria is deported, and the Avengers are left with one of their own, the Wasp, having been struck down.Assumed before the next episode:People are happy the Avengers did not try to take over America, but they are not exactly comfortable with the idea that they could probably take on the combined U.S. armed forces.This episode takes place:After some major P.R. on behalf of the Avengers, the former, wrongfully accused, enemies of the state.Full transcript of the episode:Edward: All right, Mike. It was not mind control. It was not the chameleon doing an impression of them. But, the Avengers are not actually trying to take over America. It was all a false alarm.Michael: What an alarm. False alarm though. I mean there was conflict between the Avengers and the American militaryEdward: Correct. So the confrontation that happened in New Jersey where the Avengers fought the Air Force, that was the real Avengers fighting the real Air Force. They took down the planes. The Avengers, the real Avengers actually did go into hiding. They were at large. The prior where the Avengers actually threatened the Pentagon, the thing that started the incident that started all of this where the Avengers threatened America's democracy and tried to dismiss the Pentagon. Those were not the real AvengersMichael: is what we're being told. And it's just, but it's. I don't know. There's mistakes and then there's mistakes, right? like, I mean, so if there wasn't mind control and this wasn't, imposters, if this is just a misunderstanding, it's quite the misunderstanding. Cuz it's like if, the Grand Admiral, the Navy has a misunder, there's a misunderstanding about where their loyalties lie and the Navy goes to, gets into a scrap with the rest of the armed forces cuz the adventures are basically part of our armed forces. And it just , it just seems like something you have to be sure about and, you know, and it's like, especially given they have high security clearances.They're granted extraordinary powers. Masked vigilantes, that have effectively turned into an arm of a division of our government. And the idea that you just assume that they turned against you based on a misunderstanding. I dunno. It was blowing my mind, Ed.Edward: It's clear that, that we jumped the gun, right. To be clear this is Count Nefario, who is the, richest nobleman in Europe has admitted to causing all these problems. And what he did is he created some sort of electro images of the Avengers. An illusion effectively, that apparently had the ability to be seen and heard. And he sent these illusions at the Pentagon and made this whole thing start. But I guess the first question is why do we believe that? Why were we fooled by these illusions? is there not some sort of double check, double checking mechanism to be like, Oh, you know what? Captain America just said that he's declaring war in America. Let's call Captain America and make sure that this is the real guy. This is, we're sure about this. like what's the. Hey, Captain, before you declare war on US Captain America please tell us the code that we've given you to verify that you actually are Captain America. What if an illusion of the president comes in and says like, I want to fire a nuclear weapon. We have nuclear codes that he has to type in. So we can't get fooled by a president impersonator. Why are we being fooled by a Captain America Impersonation?Michael: Well, maybe this shows a bit of the naivety on the American military and government that they didn't have those built in redundancies or, backups or fail safes. Right. I'm sure that the American intelligence agencies are always checking to make sure that there aren't any slip-ups with people in high ranking authority, the American military and, government. That's the point of intelligence gathering operations to make sure you're not surprised. And I guess what this shows is that maybe there isn't, there wasn't that level of intelligence operations within the Avengers, which we know is, well, it's only five people. there's more to them than that. I mean, especially given their connections with Star Corp. So maybe it's just shows the naivety And then the next step is interesting competence. I think there's gonna be a crackdown. Well, there should be. There should be. Like, there has to be where you have to make sure. Sorry, but you, It's that the adventures themselves are gonna be like, under greater scrutiny and, they'll know it now because it's for their own benefit as much as anyone else too.Edward: I wonder how much of it was that, first of all, we didn't have the processes in place and we need to have those processes in place. We live in a world where mind control exists, where Mastermind is a criminal that the Xmen shared with us that can create these illusions.We, knew that, the ability to create, We didn't know about Campari's illusions, but we knew that there were villains out there that had the ability to create illusions. We needed to have, measures in place so we're not fooled by them. I also wonder how much of it was That people kind of just believed it without question, as soon as Avengers turned on us, it wasn't a matter of like, this is not possible. It was, Oh, this is happening. Let's deal with it. Like it feels when the top heroes in your country turn against you. Maybe we shouldn't have just like taken it at face value.Michael: I think, ready fire aim is not a good approach to dealing with people who have, you know, been rightly without it for being heroes. I mean, it was shockingly last time we were speaking about this, you know, we were, well, we were in shock, because we couldn't believe what was happening. And I think to be fair to us, it did seem that it was happening because you wouldn't assume that the American military would go to go to war with the ventures over a misunderstanding. So it is quite shocking. It's something that has to, that we have to, I'd imagine there's gonna be congressional hearings in this for years.Edward: A few other things that are worth talking about. So, number two is, when we last spoke, we talked about why weren't the Fantastic four and the X-Men called in to deal with this. Mm-hmm. , I think we've, we've found out now that they were actually specifically asked to step down. Like they, they basically were told to stay back and let the military handle it. And I, I. Number one, whether that, Well, first of all, was, was that a good idea in not, or should they have done that or should the process be in place that the other heroes take charge when that happens? Or number two is were there suspicions already that the Avengers kind of weren't the enemy here and that's why they held back the Fantastic Four as we'll use them if we need them, but let's just keep things under control and not start a superhero war until we're really, really sure that these guys are actually the problem.Michael: I don't know because my thinking was just that if the intelligence operations with respect to the Avengers are so piss poor, then I'd imagine they would be similarly, ine. For the fantastic for the Xmen, such that I don't think the military could really trust what they were seeing or what, or their, their past relationships. So my thing is they wouldn't bring them in because they didn't wanna compound the problem the way we were talking about it in our last broadcast, but who knows? I mean, what's sort of interesting is that there doesn't seem to be any kind of countermeasures set up for the avenger. because we didn't see that in the field. We didn't see, how Dr. Blake had created that Andrea that could effectively respond to Thor. But I didn't hear about that being put into the field.Edward: It just, what you're saying is that this was kind of like, If the Avengers or the Fantastic Four, the X-Men did turn against our country for real, this was the dry run on how we would respond.And like, I dunno, the grade is not a D minus. Do we give them an F? Yeah,Michael: It's terrible. It's terrible. And so, and I think I wouldn't probably chance bringing in other superpower people that might not be on your side. This is a huge deal. It's should shock the world into preparing countermeasures to combat the potential. Of the Avengers turning on us, in a democracy where we're set up with checks and balances, just doesn't seem to be any, for superpowered individuals still, and we've been talking about this for a long time, but there should be.Edward: And if anything I think makes it, it makes it worse because now imagine military recruitment is never easy, right? Recruiting kids to go and join the militaries is hard. You're asking them to potentially sacrifice their life for the country, but now they, number one is you can be called up if you, even if you're a reservist, they were called up in this situation where right reservists are rarely called up in this country. And so they were called up and then they're called to do, they're called up and asked to fight a mythical God. Like, like, like you're, you're talking some, some 18 year old kid and we're saying, Hey, here, here, take this rifle and you are gonna have to fight the God of Thunder. It's one thing to go up against,, Vietcong, or humans. It's another thing to fight a Giant Man.Michael: I know you're gonna fight somebody that can shrink the size of an ant and then grow to the size of, an elephant, in a matter of seconds. Or you might fight against, one of the greatest American heroes, Captain America, like an expert in hand, hand combat that to help bring down the Nazis. I mean, it's a lot. What we're really circling around is the fact that. We have in our emergency preparedness, we get a failing grade. And what's gonna happen now at Imagine is that there's gonna be investigations into why. And I think that all superheroes, no matter. Their past service are gonna be under greater scrutiny, and I would even suggest possibly greater control. At the same time, there's gonna be, a greater investment into countermeasures to combat them. Even though it turns out that it wasn't the emergency. We thought it was, it still wasn't very good. It's not good for anybody it turns out.Edward: And meanwhile, the guy who caused all this is Count Nefario. He's not being charged. He's being deported, but what he did caused, Well, it could have been worse. Right? The battle between the Avengers and the Air Force that happened that was caused because of his, actions. No one was, killed. But million dollar fighter jets were destroyed. And they could have been if it had been successful, if the Air Force had successfully killed Captain America, this guy would be directly responsible for that and we're just deporting him back to EuropeMichael: Well, don't ignore the fact that he potentially destabilized the world order…Edward: …with no consequences. It was just last week that we talked about, Bruce Banner being charged with treason. They charged the Avengers with treason. Now those, both, those charges, all those charges have been pulled away. I guess we can't charge them with, treason if they're not American, so I guess we can't charge count nefario with treason. But what's the equivalent of treason for someone who's not American? It's not being deported. It's, what? He's an enemy combatant now. Like shouldn't we put him into prison?Michael:  I don't think he's, a diplomat or something. He's a rich European and I think a richEdward: He's a count, He's a noble. Do all nobles get diplomatic immunity?Michael: No, they don't. And so he committed crimes in America. So, sending him back to Europe is not what should happen. He should have been arrested. Maybe though, Maybe the American government was just sweeping us under the rug, because there's the reasons we've been discussing that. It was such a catastrophic intelligence military. Political failure, they just wanna forget about it. they wanna just move past it as if we should, which we shouldn't. I mean, this is so bad. He's clearly an enemy of America. We don't know the reason why he did this, but I can't imagine it's because he's got our best interest at heart . So why don't, we shouldn't, shouldn't there be, he should have been arrested or should have been a trial and there should be a further investigation. It's, pretty tough. But we'll see. tough day I guess, but we'll see. Cuz it's interesting for us, cuz we have a show about this, but you know,Edward: Never a dull moment Mike. Never a dull moment.Michael: Nope. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.superserious616.com

The Remote Real Estate Investor
Why you might want to have a Public Adjustor on your team

The Remote Real Estate Investor

Play Episode Listen Later Oct 29, 2022 26:34


In this episode, we welcome Public Adjustor, Andy Gurczak to speak about the role of PAs, and how you can make the most out of the undesirable experience of haggling with your insurance provider -- ensuring the highest possible settlement under the terms and conditions of the policy.  Andy Gurczak started in construction as a laborer and got his in as a public adjustor through a contractor he worked for.  Quickly climbing the ladder, he helped grow the business by attaining new clients and further building relationships with existing clients. Andy started his own company, AllCity Adjusting, where he and his team process over 1000 claims per year. Andy's Contact Info: https://www.allcityadjusting.com/ c: 708 655 4186 --- Transcript Before we jump into the episode, here's a quick disclaimer about our content. The Remote Real Estate Investor podcast is for informational purposes only, and is not intended as investment advice. The views, opinions and strategies of both the hosts and the guests are their own and should not be considered as guidance from Roofstock. Make sure to always run your own numbers, make your own independent decisions and seek investment advice from licensed professionals.   Michael: What's going on everyone? Welcome to another episode of The Remote Real Estate Investor. I'm Michael Albaum and today with me I have Andy Gurczak with All City Public Adjusting. And he's gonna be talking to us today about what a public adjuster is, and why anyone who owns property should consider using one if they have an insurance claim. So let's get into it.   Andy, what's going on, man, thanks so much for taking the time to hang out with me today. I really appreciate you coming on.   Andy: Mike, thank you so much for having me on. It's a pleasure. It's always it's fun to do these. So I'm excited.   Michael: No no. It's truly my pleasure. You're the first like we've done I think this is episode 300 and change and you're the first public adjuster we've had on so anyone who knows me knows that I'm a total insurance nerd and insurance buff so but for anyone who's not familiar, like what is a public adjuster and kind of give us a quick and dirty of what you're doing in real estate.   Andy: First of all, Bravo on 300 episodes. Plus, that's awesome. So thanks for you guys. And I'm lucky PA so this is pretty cool. Yeah, so public adjuster is is licensed by the state, he's legally able to represent the insured in their claim process, negotiate and settle the loss for them. Whether it's commercial or residential. It's basically like having an attorney on your side or an accountant doing your books. It's the same exact thing. They're licensed by the state that they work in as well.   Michael: Okay, okay. And I mean, it just seems like kind of counterintuitive. I go and pay an insurance company every single month, every single year to give me insurance. Then when I have a claim, an insurance claim, I go to the insurance company said, Hey, insurance company, here's this claim, pay me for the claim what I'm owed. So why do I need a public adjuster? Like why does your job even exist?   Andy: Yeah, that's a that's a great question. The reason our job exists is because insurance companies don't pay claims and don't pay them fairly. We've talked about this before the show, Mike, you work the insurance side. So you know, that claims, actually two people that work in our office work the insurance side, and they've got they seen how bad a guy and came to our side. Because claims are handled, I mean, horribly every year, it gets worse and worse. And our we just had a meeting with a couple of attorneys just discussing what's going on and what we could do in some situations, because it's getting so bad, that, you know, insurance companies aren't responding for a month or two months, or just I mean, so having a PA on your site, even though it's your claim, and you think you have to remember that insurance adjuster, that staff adjuster and every one that they send out every vendor contractor they sent out, they all get paid by the insurance company. So they're all working for this one entity. And then you're by yourself. And you're thinking, well, they're on my side, no doubt on your side. It's all about profits, margins, all that good stuff. So…   Michael: Yeah, I know it's so the word of news is sick. When you find out kind of what's going on under the hood. It's really what should be a partner relationship. Like you mentioned, everyone on the same team working for the same goal can be come very contentious very quickly. So you said it's like having an attorney or like having a bookkeeper on your side? I mean, it sounds expensive. How much do public adjusters charge? Like, how does that work?   Andy: Easy. Yep, Pa is most of the time charge a contingency fee. So there's no retainer is nothing, it's all contingency on what they recover. And you know what the claim settles for. And standard is 10%. Like our company has adopted just a 10%, nationwide, whatever claim we're handling, whatever the size is now, some situations where we come in, let's just say months after a year after the claim has been paid, and we're just trying to figure out maybe another coverage or paid additional than it might be a higher fee of maybe 20-25 on the money that we recover above that amount that would the only difference,   Michael: Okay, and so just so we get it crystal clear for all of our listeners, because I just went through this on a claim to fire claims I had on a property. If the insurance company comes into my claim, and says, Hey, Michael, we're gonna give you $100,000 For your claim, and I'm like, There's no way it's gotta be worth way more than that. You will come in or a public adjuster comes in, you end up getting me a million dollars, you're gonna take 10% of that additional 900k That you got me above and beyond what I was originally awarded.   Andy: Yeah, exactly. And something in your situation. So when we have claims, and we have large investors and management companies, we have a pay scale that actually the percentage goes down once it reaches a certain amount. So reaches, you know, half a million that 10% may become nine, right for every client, we kind of work with them, just because we kind of know their position. And again, we want to create a relationship that is long term, because then we're getting called when before the claim even starts right because we want to be there. You know, another question is when do you want to hire PA for the day you have a claim, because you want to make sure if that claim is a legit claim, if you should even file that claim, whatever your deductible is, is that even a covered loss?   A PA will, you know, we do this for our clients all the time we do their policies with their claims without making any money or charging any fee. It just part of our relationship with our clients.   Michael: Okay, I'm so glad you brought that up, Andy, because I get this question all the time. Because so many people don't like, insurance, education is not something that's really provided out there. And I'm wondering if that maybe is on purpose by the insurance companies, but like, how should people if they have something happened to their property? And statistically, if you own a property or enough properties long enough, you will probably have a claim?   So what's the process? Like if you could articulate and paint us a picture of as a property owner, whether it's our own property or an investment property? What should that process look like? What should what should owners be doing? Who should they be talking to?   Andy: Yeah, if you don't have a PA, and you're kind of going to try to do this on your own, you want to first stop whatever loss happens, you want to mitigate the loss, right, you want to get first you want to you want to get your copy of your policy to you want to see if your agent because you most likely don't have a copy, because no one knows that they don't have a copy until they have a loss to be like, Oh, I have this page, I'm gonna get your declaration, you need your policy, your booklet, you know, no one gets that usually, until something happens. And then it's hard to get it from the insurance company, it's like, they don't want to give you your own policy, very normal. Then you want to mitigate the loss. So if it's a fire, you want to board it up, protect it, make sure no one can get in there. Or if it's a roof, you want to cover the roof, if it's a roof claim, and then you want to go and take pictures and document as much as you can, and then call the claimant.   And when you call on the claimant and you're trying to set the reserves high enough. So then when they come in, and let's just say you have $100,000 loss, but when you told them the claim, you might have said, well, it's a small fire in the kitchen, small smoke, they might have reset the set the reserves at 25,000. And now the claim is actually 100. So now when we're trying to fight it, we're going to five managers like what's the example at State Farm, for example, once it goes past the reserves, you're going through letters like five managers to approve one payment are one extra additional line item, it's it gets really crazy.   So the most important is mitigating, mitigating the loss, getting your policy, reserving the claim calling the claimant, right? And if you don't know the answer, when you're discussing that claim, when you're calling it in, just say I don't know, because a lot of people get into trouble by trying to say too much to be too honest. And it's not about being honest or not, or, or lying. But people say the wrong words, they might use the word like mold, I see mold. Oh, well, molds not covered. Here's a denial letter. Well, the water, you know, the water happened three days ago, we have there's mold, because you know it's wet, it's humid mold molds catch up, but there's still water damage that's covered.   So different words they use. So you gotta be careful with words you so you want to do your due diligence, or even call your agent to call that claimant for you. If you need help.   Michael: Let's talk about that for a minute. Because in the agent world, you have captive and non captive agents. And so just like you were saying all the vendors are paid by the insurance company. I mean, in a lot of instances, aren't these agents paid by the insurance companies as well?   Andy: 100%. And I have friends that are agents and I know people are agents, and agents have a bonus if their clients don't file claims. So there is a bonus, there's a perk of them if their clients don't have claims or the correct. So everyone's got a benefit if the claim is not filed, and if it's underpaid, everyone gets points on that.   Michael: So can we surmise that if you have a claim, you should just call a public adjuster immediately?   Andy: 100%. Because it's a free review, what's the worst is going to happen? He's going to come in there and say don't file it. You don't have to sign with that PA but at least get that expertise. Now you want to make sure you find the right one. But if you do you have them looked at it and in depth look at the claim inspect the roof, inspect the fire damage inspector water damage and let you know everything you should do.   Michael: Yeah, I am. I had my first big claim to have them back to back couple years ago, I had two fires in a commercial building back to back a week apart, which I used to work as a professional fire protection engineer. And it's like statistically impossible to have that happen. I'm the one exception, right? So I went through the claim process I had the insurance company come out do their inspections like oh, it's small fire just like you said, you know teeny tiny claim payout. And I'm like dude, that doesn't even cover the materials that were sitting on the roof when I had the roof fire. So I brought in a public adjuster and they know about 15Xed that claim. So I can't sing their praises enough. When someone is searching for a public adjuster and you just mentioned this, you want to find the right one, like what does that process look like? What questions should you be asking?   Andy: I've never been on the other side. When I look and talk to our clients how they found us obviously they were looking online Googling and stuff and they were doing a search engine and kind of we came up online we do a lot of blogs and stuff. So we'll come up there with a lot of tips and stuff for people so they'll find our name. Otherwise, so if you're not looking online, you know, you can check websites like patio, which is Texas associations of public insurance adjusters, California has their own, some states have their own. There's the NAPIA National Association of Public Insurance. So there's different associations that you could go on, and find adjusters pas that have been screened and have backgrounds and pay their dues, because they're part of an organization. So that would be your, you know, your best bet. Referrals. Again, if I, if I knew you, I would say, Hey, Mike, you had a couple of fires, you know, did you hire who's a PA, you have someone to recommend. That's, that's your best bet. Someone that they worked for referral.   Michael: That that has had the actual experience with them? Yep. Okay. Are there certain questions that someone should be asking? I mean, what separates the different pas that are out there? Because I'm sure if I google that would get tons of different results. Is one better than the other? Like, is it just based on the fee structure? What should people be be considering? If they're going to hire someone?   Andy: That's an awesome question. So a lot of what you should be asking, and when you go online and look for PAs, a lot of them say, you know, fire water, they do all these things. But 90% of PAs handle just roofing claims, usually residential, some commercial. So it's, you have to make sure that hey, how do you handle fires? And how many fires have you handled? Or what do you specialize in? You might say, Well, we do a lot of roofs. That's not the PA, if you had a fire, you don't want the guy that's handling roofing claims. Right? For us, we do large loss, fires, water, hurricanes, we don't if someone calls for a residential roof. We don't we don't do residential roofs, we would love to, but we don't we don't specialize it. There's other PAs that do a great job, here's a couple of names you can call or, you know, Google and and find the problem just and it's in that it's just a committed, you know, attorney, some attorneys do, you know, personal injury, some do properties. Same thing with PA some PAs are better at some coverage than others.   Micael: Yeah, that makes total sense. Andy, let me ask you a question. Because it happened to me. And I'm curious now with the hindsight, what the proper move is, so I had this fire, and it was on the roof. And it was during a reroof. So they had all the materials up there. So all the materials burned up. And my public adjuster said, Don't touch anything on the roof. He said, We got to come out, we got to photograph everything we need to take care of, you know, we need to document everything. And meanwhile, it's really windy. There's debris blowing onto the neighbor's property into their, into their, into their courtyard and their fence. And so the neighbors called me complaining threatening to sue, they got crap blown everywhere. And I'm like, I can't it's like an active insurance investigation.   So you were talking about you want to mitigate the loss stop the loss from getting any worse. But are there instances where physically mitigating the loss than is like evidence tampering is the wrong word, but you understand how it's changing the scene.   Andy: Double edged sword? Yes, a double edged sword. We walk into properties all the time. And you know, or let's say we go into a hurricane area, or right now in Florida, and we see people outside with all their contents, right? Like all their house stuff, just in a pile. And I'm like, did you guys order material? Everything's gutted? I'm like, did you guys inventory take pictures? Well, no, but the insurance company said to just throw everything up. That's the worst idea ever. That's what they want. You just get rid of all your evidence. So that's a double edged sword. So when I say mitigate, you're supposed to mitigate the loss because they can technically your duties after last say you will mitigate. So if you don't, they can deny it. But what's mitigate right? If I had a pipe burst from the third story water comes as floods my whole house right? The insurance company is going to want to send a vendor out to pull some drywall or spray everything or dry everything and leave it. That's the goal. That's mitigation. But mitigation is you turning off the water. That's already mitigation, because it doesn't specify what technically mitigation is. It just says mitigate. So by me turning off the water, I have mitigated the loss. And I will tell my insurer just leave it because it's already all damaged. Whether you dry it or not, that's just gonna go against your thing. It's already damaged. It can't be its category three water. So it's got to be all replaced. Instead of paying a vendor all this money, this has got to be gutted, all that money should just go to you instead of that vendor.   So yeah, there is instances. So in yours, just because we have insurance, karma saying any Can we start rebuilding? Well, now because we're still fighting with the insurance company, and we're still negotiating, and if you start the repairs, then you you can date that's what they want. They want to keep holding, holding until you actually accept it and start the repairs.   Now, if they don't start the repairs, then they'll go well, why didn't the insured start the repairs? Right? So it's, we're trying to keep our clients in the best situation to make sure it's the best possible outcome. But it's hard sometimes, especially with landlords when they have tenants, right? Hey, my tenant is going to sue me or my tenants gonna go this if I don't do the repairs. Then do the repairs, I guess. And this is the settlement we're getting. So an insurance company knows this. So, in your situation. That's a tough call. What do you say like either the PA say, Hey, we got to do it this way. And he was doing it the right way. Because if you did mitigate or clean up that thing? And they come in? They're like, ah. Even if you document it, I'm telling you, it's like they don't even look at your photos. They don't care. Yeah, so they did the right thing.   Michael: Okay, good. Well, that's good to hear. I'm gonna go, I'm gonna go send them another thank you text after this episode. Yeah. Andy, can you give us like, maybe two scenarios to stories that you've experienced one where things went perfectly well, or as good as they could have gone and what you you're insured what your clients did to get there. And then maybe a scenario at the opposite end of the spectrum where things just like, just like, give us like the worst thing you've ever seen happen? Just so we have a little bit of context that…   Andy: Part of like claim handling or like? Okay, so I'll tell you, we were just like I said, we had the attorney, we were kind of going over claims and we have one, and I won't say the insurance company. This is in Gary, Indiana. This this poor lady that waged her claim has been handled, and it's by an adjuster that we've seen handle bad claims for other people in that area. Whether it's color, race, area, I don't know. But the way this this claim has been handled this lady the under oath and everything she's been through, like we thought we had it all over, they finally after six months, say okay, well pay the claim. And here's the money, we got to argue with them. They started at 30,000. It's $160,000 claim. But then we have contents another 160 that we sent wants to go and now we're asking what's going on with the content. So they come back well, well, which which was the insurance and which was her daughter's. Why does it matter? If you had a fire Mike, and you have your kids and your wife stuff in the house? That's all personal property? They're not on the pile? Are your kids on the policy now? Yeah, no kids are on the policy, but their stuff is covered. Right? So why are they're asking her so now they want to examine her again and her mom. So this is going to drag on for 10 months. So this and this claim is ongoing. So to us that to me, it's like, well, now I'm powerless as a PA. But what can I do?   So the only way is the attorney can help. But again, she's still going to have to do that examination. But it just shows how long they'll drag it and try to find ways of however, to underpay or just deny that claim. So that's bad. Yeah. And we have a bunch of those. So those hurt a lot of them, we win, this one again, we got the structure paid and figured out. Now we thought the contents was going to be a slam dunk, easy. Here's everything, even your vendor said, you can't clean this stuff. Great. Here's the list. Here's the pricing age of items. And now they come back with this. So, another tactic to delay the claim.   On a good note, we had one, it was a it was from another podcast, one of the investors students called us, he got the number to us and he called us he had a 16 unit in Champaign, Illinois, burned down here to ACV policy, you are familiar with actual cash value. Your listeners might not but meaning he would not recover depreciation, he would not get that amount even if he rebuilt. So he was just getting what's what it's worth now. So that building, he had a fit 550 limit that just came in, he wrote like 560. And they depreciated and cut him a check for maybe 300,000, something like that. So when we got hired, we sent our letter representation, and the adjuster called and said, Hey, Andy, you know, I paid this, I paid this to Max, I don't know why he hired you. I'm like, Well, you didn't pay loss of rents. And also you haven't paid demolition expense, and you only paid 300 when it's a 550 policy, you stopped writing, because our estimate is like 900,000. With no like edit, like this is just it.   So then we reconcile and the insured ended up getting 100%. So 550 plus 5%, debris removal, some other endorsements, plus he maxed out everything. So he ended up walking away with another 400, like 300K. So again, when an adjuster says, you know, we don't need you. And that's it again, there's many claims like that, those are the positives, it's the ones that drag on, and that you like, you know, you're close, but they're still like delaying, delaying, delaying. And it's like they want the insurance to just finally say, Okay, well, I'm done.   Michael: I'll just throw in the towel.   Andy: Yeah, it sucks. And, you know, there is statutes in each state, which they have to follow, but it's never followed, because no one ever calls them out on it. Because unless you actually go to court or litigation, that's when they show okay, we didn't do this. They didn't do this. But other than that, they don't really know. They kind of do their own thing.   Michael: Yeah, because they're so big. And you bring up you bring up a really good point ACV versus replacement costs for anyone that's not familiar with the to give us from from like the PA side of things. What is the benefit of one versus the other? Because I'm sure your clients have seen like the reason your client probably had the ACV was because the replacement costs value on that 70 unit 50 unit was just probably astronomical. So it's often a cheaper policy to get like what's the downsides of going with one versus the other and what risks do people run by choosing one versus the other?   Andy: So the riskier is with the actual cash value policy and most most policies are RCV based. And then they have the actual cash value endorsement that says we only pay actual cash value, what happens is why you would do that policy where some people might get that policy and our insured wasn't even aware of it. But the agent sold it to him didn't explain to him the differences. He didn't know that he had that extra cash value policy. So you know, that's another story. He went on his own. But, so what happens is you, it saves you a lot on your premium, especially if you're investing you're trying to make margins and you know, it could save you on a property like that 2-3-4K a year, right? Well, it's great until you actually have a loss, when you have a loss. You know, it's especially on older buildings, it's cutting your payment by half. And you can't recover that money because it's actual cash value. So the replacement cost of you know, your home today is 300,000, but the actual cash value after depreciation, your actual cash value is 150. Well, you're only getting that 150. Even if we got the settlement of 300. With insurance, your policy will only allow for the actual cash value of 150, which will leave you with only half the money to rebuild.   So you're always as an as an insured, you should always have a replacement cost policy. And now they have you know, different like guaranteed replacement costs and all this other openly, openly insurance actually has it. They don't even have its guaranteed replacement, because they don't even have a limit. I think it's up to one like there's no limit on structure a   Michael: Holy smokes.   Andy: So there's some new carriers that are really, really, really good, actually.   Michael: Okay. And that brings me to my next point. And I'm so glad you brought it up. Like Should folks be involved in public adjusters in their insurance carrier decisions as they're looking to go place insurance on properties?   Andy: I would hope so. Because all we do is read policies every day. All I do is read policies interpret policy. So I know when I'm looking at a policy, I'm like, Well, you have a good policy, but you don't have you have a finished basement, you don't have any water backup, you your roof is actual cash value only. Oh, I didn't know that. I didn't know there's a lot of stuff you you should be aware. So yeah, our longer term clients will actually inspect their properties, look at their policies to make sure they don't have any exposed liabilities. Right. Now, it's not our job. It's the agents job. But most of the agents now are just, you know, selling policies instead of actually doing their due diligence and ensuring the claim the right way, they insured.   Michael: Yeah, I just want to echo exactly what you said, for all of our listeners, like now the public adjuster that I worked with on this on these fire claims, I sent him every policy and every quote that I get for properties, and he told me he's like, happy to do it. He's like, Yeah, this is a great carrier. But this is the other thing. And also, he can tell me like, Hey, I've run up against this insurance carrier, we see them all the time, like they don't pay claims, we're going to be working together a lot more if you have a claim if you go with this company, which is super great insight to have.   Andy: That's, that's awesome. And that's the same thing. I would say, I would say this carrier, we have a lot we have, you know, this many claims every year. And you know, maybe it's a lesser policy, and that takes longer, but they'll pay the claims, right? These guys just don't pay or they didn't know, I have a list of insurance companies that I know that are easier to deal with. Now, it's your claim guarantee you're gonna be paid when you file a claim with them. No, it still might be a hard process. But they're much easier than these eight other carriers that they're that are out there.   Michael: Yeah. This has been so great. Andy, my last question for you, man. How many claims do you handle a year just out of curiosity? So I can we give people an idea of…   Andy: Yeah, we do over 1000 claims a year?   Michael: Well, but how many how many public adjusters in your office?   Andy: Oh, right now we have four. Right now we have four and we're just we just keep growing. We do a good job marketing and, and building our social media presence. And yeah, it's, it's, it's good. And I mean, I guess it's bad for the insurance. Maybe these claims are handled. But yes, tactically, we, our business grows and we get more calls.   Michael: That's awesome. And I want you to share with everyone your contact information where people can get a hold of you and like what kind of I know you said you don't do residential roofs, but what kind of claims should people consider reaching out to you for?   Andy: Any fire, you know, water claims, you know, whether it's broken pipes sewer backup, we can inspect those or at least advise sewer backups, usually, or water backup limits, they usually have a limit. So I see your limit is 10,000. I look at the photos and I'm like, Well, you max out the limit. You don't need a PA this one's just a max policy easy. A lot of people that call us if we get to two calls, three calls a day of clients that we just kind of give them advice because there's no need for a PA in some instances, they will but we can give them at least advice and help them out.   But fire claims hurricane even commercial roofs we do commercial roofs a lot. Residential roofs is just the one thing we don't really do. Just because we we don't have the staff to do it. So…   Michael: Yeah, okay, fantastic. And for people that want to reach out learn more about your take advantage of your services, what's the best way for them to do so?   Andy: The easiest way is my cell phone. It's literally for your clients they can for your listeners, they can call me it's 708 655 4186 that's literally my cell phone. They can text me call me I'm really easy to get a hold of while I still can. I'm able to get my phone away so write it down because I might have to switch here I might not be able to give my phone away and my wife gets mad with more calls.   Michael: I hope you're so busy that happens.   Andy: So ya know so far so far. Okay, wife's not getting mad, so…   Michael: Awesome. Andy, thank you so much, man. This was super great anyone watching the video could tell I'm super giddy talking about insurance stuff. It's so great to meet someone that's also as giddy so no, I really appreciate the time.   Andy: No, it's fun to actually have a host that actually knows that that area and yeah, it's fun. You You know you've been through it now yourself. So you kind of know the you know, you know, you know what we do and what a PA can help. So it's, good.   Michael: Big time, big time. Well, thanks again, man. I'm sure we'll be in touch.   Andy: Mike, thank you so much for having me. I appreciate it.   Michael: All right, everyone. That was our episode with Andy, A big thank you to him for coming on and sharing some great information, some great knowledge and wisdom with us. Definitely. If you are someone that is going through an insurance claim or will go through an insurance claim in your lifetime with the property you own, definitely consider hiring a public adjuster they are worth their weight in gold. As always, if you enjoyed the episode, please feel free to leave us a rating or review. We'd love to hear from you all in the comments section and ideas on future episode topics. And we look forward to seeing on the next one. Happy investing

Screenwriters Need To Hear This with Michael Jamin
Ep. 047 - When Putting Your Work "Out There," Where is "There?"

Screenwriters Need To Hear This with Michael Jamin

Play Episode Listen Later Sep 21, 2022 26:28


How should I put myself out there as a screenwriter in 2022? If you follow me on social media, you know I constantly give people that advice, "just put yourself out there." Well, this week on Screenwriter's Need To Hear This, we discuss where "there" is and how to put yourself out "there."Show NotesMichael's Online Screenwriting Course - https://michaeljamin.com/courseFree Screenwriting Lesson - https://michaeljamin.com/freeJoin My Watchlist - https://michaeljamin.com/watchlistTranscriptions are Auto-GeneratedMichael's Online Screenwriting Course - https://michaeljamin.com/courseFree Screenwriting Lesson - https://michaeljamin.com/freeJoin My Watchlist - https://michaeljamin.com/watchlistTranscripts are auto-generatedMichael:You know, there's not a lot of demand. There's not a strong demand for, for poor to mediocre scripts. And I think some people think well, but that show on TV that show's terrible. Can I do that? Mine is just as bad. It's like, well, we, we can talk about why that's bad or you know how it's unfair that their bad show is on the air, but, and your a bad show, your equally bad show is not. We could talk about that, but I think your odds, it go up exponentially by doing something great. You're listening to screenwriters. Need to hear this with Michael jam.Michael:Hey everybody. This is Michael Jamin. And welcome back to screenwriters. Need to hear this, the podcast for screenwriters who need to hear this. And today we are talking about the title's episode is when put, when putting your work out there, where is there? Because I, I say that a lot. I say, Hey, just put your work out there. And people, one guy was like, Hey, well, we have a where's there. Where is there? Which is a fair thing to ask. And so my answer to that, Phil is anywhere, put your work out anywhere. So whatever you got going on, if you've got nothing going on, which is fine, then putting out your work out there means giving it to somebody else. You know, if you're only, if you only read person, who's read your script or you seen your project is your mom. Show it to one other person.Michael:Now you've doubled the number of people. And now you may think that, okay, but that's not enough. Okay. There are other things you can do. But so many people think like, you know, when you're putting your work out there, is there a website? Is there a contest? Is there someone's door stop? Is it me? I'm not the gatekeeper. The gatekeeper is not what you think it is. You know, when I first started in the business, I was just a dude who wanted to be a writer. And I teamed up with another dude who wanted to be a writer. There was nothing special about us. We didn't have connections. We were just two dudes and we were, we became friends. Right? And that's how a lot of partnerships or, you know, that's just a lot about how opportunities, not even just partnerships, it's people who are friends, just doing things together because they both have a similar goal.Michael:And so putting your work out there means finding people like you, because making it in Hollywood is climbing a mountain. And when you climb a mountain, you don't start at the top. You don't, you know, you don't show up to Netflix with your script. Hey, get, you know, it doesn't work that way. I mean, maybe it has for one person and, but don't kid yourself for everyone else. You have to climb your way up the mountain. That means starting at the bottom, not starting at the top. And so where do you start at the bottom? The bottom is anything more. But if you've got this going on in your life, which is nothing, then do something, which is a little more than what you have. If your neighbor's shooting something and their backyard, that's more than what you got going on. It just because they don't have the universal studios backing them doesn't mean it's not worthy of getting involved in them, you know, and whatever they're doing, because those people, people with similar interests tend to do things and they rise up and you wanna be part of that.Michael:A simple thing to do, a very simple thing to do is if you live in a city, go to your local film school, like how, you know, a lot of cities have, or towns have film schools. And every semester they have they usually have like film festivals, like to, to air the kids' work, their projects. And no one's going to those things be, who's gonna go to that. Like just their mom and their dad, and maybe the roommate go buy a ticket. It'll be $5. It's not gonna be much. If anything, maybe he's free. Go sit through these movies and go watch them. And at the end, mingle with the, these kids and find something nice to say, even if they're terrible, there's, I'm sure you can find something nice to say about something. Go up to the director. I love the way you lit that scene in the alley.Michael:Go up to the writer. I love the way you wrote that, that wonderful, the triplet, you know, in the bedroom scene. I love that. I love that. Go up to the actor. You play that so wonderful. Even if it's terrible, even if like the whole thing as a whole, isn't great. I know you can find things to like about it. And just go up to those people and say, Hey, I love what you just did. Consider myself a fan. I'm a fan of your work. Now, a young kid who hears that is gonna freak out because imagine a stranger saying that and that kid, maybe they can't collaborate with some on something now, cuz they're in film school, but they'll be at a film school in a year or two or whatever. And now you are part, you know, now you're hanging out with people who want the same thing and, and maybe you collaborate.Michael:Maybe you'll work together on something. Maybe you won't, maybe they'll have an opportunity to, you know, to hire you on something. But those people are gonna go up and you wanna build that base. You wanna build that circle. And that's honestly, you know, that's one of the advantages. So we have this, this, you know, screenwriting course. And one of the advantages is that we have a private Facebook group and I see the people in this FA the private Facebook group, they've gone to my course, they've learned all the lessons and now they start, they're ha they're collaborating. Some people are teamed up. Some people are they're doing table reads together. You know, they're socializing in the, and I think that's fantastic. I'm not doing, I'm not organizing any of that. They're organizing it on their own. They're having table reads. They're helping each other out, which is so smart because that tide rises, man. You, you know, they help each other out. People are already doing great things in that, in that group. Good for them. And they don't need me. I, I don't need to, you know, prod them. They're doing it on their own. These are the fact that they're doing it on their own. These are people who are, who want it, who want, who will make something happen, cuz they want it. You know? Yeah. I've always hanging out with those people.Phil:I've always described that group as a, as kind of, there's a barrier to entry there. And I think that, you know, you and I have talked about this too. There's a price on your course and there are a lot of people like, well, why are you charging for a course, if you, why are you giving this away? And I'm the one who pushed for the price on the course because I have experienced enough. And I've invested enough in myself in many ways in the business world and the marketing world. I continue to do this. I've paid for most screenwriting courses online because the people who will appreciate it the most are the ones who will pay for it and you're giving away important information. Yeah, but that also is important to those of us who are in that private Facebook group because all of us are showing we are committed to making this work. And that means when people are asking for notes, they're asking for help. They're asking for feedback. The value that is being shared in that group is, is extremely high. And I've been in a lot of free screenwriting groups. It's people who understand, they think about it the same way. And they're just as committed to the, to making this work and making crew out of this as I am. And as the Dave Crossman's are and the mic, everyone, everyone is,Michael:They got skin in the game. You gotta put skin in the game free. If it's Free's worthless and it's not worthless. So put skin in the game and that'll keep and, and, and that'll keep your, you know, motivated. , you're investing in yourself. You're gonna be motivated to make something happen. And, and yeah, so anyway, I would, that's one thing I would do. I'd go up to those film schools and start socializing with those kids. I would, if you're in a town in the middle of nowhere, I would go to your community theater, local theater, and you'll find people, actors, writers, directors, who wanna be involved, who want maybe they want to be involved in your next project that you write. They just wanna act in it. And so that's your little circle. I mean, and there's amazing things that can be done.Michael:Remember everyone who got like, who breaks into the business? We we're, no one's beforehand. There's nothing. It's not like we had signs over, had future success. It's, you know, we're just people. And so that's what I would do. And, and a couple of a couple weeks ago, maybe it was months ago, I don't remember, but some, some kid reached out to me from film school. He wa he was looking for an actor in his fifties to, to be in his, you know, student production. Now wasn't really interested in that. But if I were an aspiring actor, you better believe I would've said yes to that. I would've you know, yeah. I'll, I'll do that because those kids are going places and now you're building out your network. And so there's just no, like where is here? Here is anywhere. Just put it out anywhere, do whatever, you know, that that's, I mean, that's what opportunity looks like opportunity. Doesn't look like someone handing you a check opportunity, looks like you making things and doing things, you know? And, and they always, one thing leads to another. It just does, you know?Phil:Yeah, absolutely. I mean, you've put yourself out there over the last year on social media and you. Yeah. Right. And that platform, you know, we had a podcast recently talking about, like, if you were trying to break in, what would you do? And you would do this. You would be putting yourself out on social media. Mm-Hmm podcast. I think I look at that and I think, okay, I am not a produce screenwriter. Why would I write a podcast? Why would I have a podcast about screenwriting? I don't know that I would, if I weren't here with you, because I'm very aware that there are a lot of Charlas and snakes oil salesmen, trying to get ahold of people and make them think they're an expert. And they're pretending to be something right. If you're interviewing experts, that's a different story. If you're providing value in getting access for a different way, that's a different story. But that doesn't mean you need to be putting yourself on social media as a screenwriting expert, if you are not. I think what you're saying is you should be showing everyone what you have. You should be giving it away for free. You should be putting it out there so that people can easily get access to the special thing that makes you a talented person who can write act direct, produce, whatever it is you're doing.Michael:And you've had some opportunities just because of your you're doing this, or people know you and people, you know, come up to you just because of this, because you're putting yourself out there. You know? So, and you know, we talked about some things off all on the side. Things, opportunities have kind of come your way as a, just because of what, just because you're here now, you know, mm-hmm, and you're showing up, you know, even on the, even on the job you were currently working in, you're showing up. Yeah. So yeah, don't I guess don't be so literal in terms of like, people say, well, you know, how do I get my show on HBO? Well, you start at the bottom. That's how, yeah. You know it, you know, I don't, I, I, I certainly did. I certainly it's so odd that people, I don't know, I guess they getting its information on the internet, but like, like they're like, how do I sell a show on HBO or, or any network really?Michael:Right. And well, I'll tell you how I did it. I started at the bottom so I can go in and I can pitch them and it's not easy. And I certainly, it's not a guarantee I'll sell anything, but I can, I can get the session. I can, I can get the pitch, but it's because I've earned it. And they've, they trust me now with that I'll do a good job if they want it. And that, you know, I know how to make it, but so a stranger, they don't just come off the street. They're not, what do they, they're not gonna just trust someone who hasn't done anything before. Why would they, would you, I mean, would anybody, you know, you're not gonna hand over a check for a couple hundred thousand dollars to someone who hasn't done anything before, that would be nuts.Phil:That message is something that separates you from every other guru in the, in the world. Not that you call yourself a guru, but there are a lot of people who claim to claim to be, and there's selling the dream. And when we started putting the course together and we started putting this stuff out there, that was one thing you were adamant about. I cannot sell the dream. I can't be the guy who goes out and tells them you're gonna make it buy my course, rah, rah, you're gonna make it. And there was a lot of pushback on putting a price tag on the course. And I said, you need to, because they're gonna need to value it. And we have to figure out a way to not to not sell the dream and your way of doing that is being so real with people.Phil:That, that seems to be the thing that stands out for you. That's the thing, time and time again, people say ouch needed to hear this. Thank you so much for being real about this because you're taking people down from cloud nine, have done real expectations that I might have had of being an nickels fellowship winner. On my first script I put in, or an Oscar winner on the first thing that gets produced, whatever it is, whatever delusions of grand or that I had to have to give me to where I am today, that dose of reality is very important because it does two things. One, go ahead.Michael:Well, no, please go, please finish.Phil:Let's say it does two things. One, it makes you take a dose of reality to take a step back and say, Hey, how committed do I need to be to this? And do I have what it takes to actually commit to doing this with the belief that I will get better at the more at bats that I have, or right. The other option is, man, this is not for me. I think I'm gonna go back and I'm gonna be in tech sales. I'm gonna make a pretty good living there, enjoy my life and just enjoy film and television,Michael:Right? ThatPhil:Possible. It's a valuableMichael:When we talk about, you know, living the dream, we're selling the dream, like to me, the dream is, and this, but I made clear about the course is the dream is I will help you become a better writer. I will help you express yourself. And hopefully right at the level, that was, that is required for you to get work. But you know, that's, that's what I can do for you. I can help you cuz you know, there's not a lot of demand. There's not a strong demand for, for poor to mediocre scripts. And I think some people think well, but that show on TV that show's terrible. Can I do that? Mine is just as bad. It's like, well, we, we can talk about why that's bad or you know how it's unfair that their bad show is on the air, but in your a bad show, your equally bad show is not. We could talk about that, but I think your odds go up exponentially by doing something great. You know? And that's, you know, that's all I can help you with. You know, I can't promise you anything other than that. So,Phil:But, but what else do we want? Like what, what more could we ask of you, right? That no one's gonna make it in this world until they happen. Like, and unless you make it happen for yourself, you cannot rely on other people to give you anything. Self reliance is the term. We call that in any other aspect. And I think there's a level of self reliance we need to have. And what you're telling people is you need to do the work. You need to sit down, you need to write mm-hmm , you need to understand the craft. You need to have those practice at bats. You don't have to go out in front of a major league ballpark and try to hit a home run. You can put in the daily singles that we've talked about early on this podcast. What can I do today to get ahead? And that's it, that's all is required as daily singles.Michael:And I'd like to also add, you know, the, the barrier entries is actually quite different than it was when I broke in many years ago. I, I, I would describe myself and this is a weird thing to say, but I, I, at this point I'm calling, I'm kind of a Hollywood insider. I've been doing it for 26 years. So when I pitch a show, you know, I'm, the guy you'd think that would they, they would buy a show from, I have 26 years of experience. Who else do you think they're gonna buy a show from? If not someone like me, right? So I guess I'm kind of an insider, but the last three shows that I've worked on were from, that were created by Hollywood outsiders, Hollywood outsiders. And so that would be Maron, re link and Tacoma FD. These are people who didn't come in through the Hollywood system and they just created something special on their own and became success, made it so big and built up a big following and, and a fan base because they just did it themselves because they didn't ask permission. And then because of that, they got so big that they needed to hire people like me to help, to help them with their TV shows.Michael:Hey, it's Michael Jamin. If you like my videos and you want me to email them to for free join my watch list. Every Friday I send out my top three videos. These are for writers, actors, creative types. You can unsubscribe whenever you want. I'm not gonna spam you. And it's absolutely free. Just go to Michael jamin.com/watchlistMichael:There's room out there for people like there is create your stuff and make it great. I mean, you still have to be great that there's there's that little matter you have to get over, but but isn't that isn't not the way it should be. I mean, should shouldn't it have to be great. I mean, yeah, that seems reasonable.Phil:I think so tying this back to what we've been talking about across the board, you practice practice, like yeah, you don't go out and become an NFL player. And again, we've, we've talked about the statistic about slightly more NFL players than there are slightly more working writers than in the NFL. Is that right? Yeah. Right. So we've talked about that quite a bit. So the odds are not great for most of us to be professional writers, but I can tell you what improves your odds. Yeah. Working out every day, getting faster, getting stronger practice, throwing the ball, practicing and, and drilling tackles and, and learning the playbook. All of those things that you would do to be a professional athlete. You gotta do 'em as a writer too, you need to come, right? If you show up every day, you need to practice coming up with ideas.Phil:You need to sort through the wheat and the Shaf to find the good stuff you gotta, right? You gotta break stories. You need to figure out when you break a story, why it doesn't work, you need to do your outlines. You need to figure out why it doesn't work in the outline, but it did. It felt like it worked in the other one. You need to write the first draft. You need to finish the first draft, which is hard for most people to do. Then you gotta do the hard part, which is share that really bad draft and know that it's bad with people who are gonna give you good feedback on it. Then you have to take those notes and you have to dust off what works, figure out how to make it better, send it out. Then you gotta do it again and again and again and again and again.Phil:And then you, when you finally have something that's good enough, you gotta put it away or send it out. And then you gotta do that again. And you gotta show it again, this whole process over and over again. And most people do not have the fortitude to do that because it's hard work, but no one's gonna do it for you. No, one's gonna get up at an hour earlier to help you sit down and write for an hour every day. No one's gonna have no, one's gonna send that email to your friend. Who's a writer and say, Hey, can you read this and give me notes? No, one's gonna sit down and get the notes and then apply the notes. No one's gonna do it. You have to do that.Michael:So my partner and I, we have a, we have a project set up an animated project set up at, at peacock now, but we also just pitched a project that didn't sell a, it was a live action project. Didn't sell. We were willing, took out into a few networks and whatever they weren't interested, which is par for the course. So my partner texts me today goes, well, when do you wanna start on the new idea? So, alright, Tuesday. So on Tuesday we start this project, this process, again, of coming up with an idea and then going out and pitching it, knowing full well that the last time I did this, I didn't sell it. And this is par for the course. So I don't just stop. I don't just think, well, I don't just have this one idea and I don't beat it down every door and, and beg people, whoa, whoa. You know, when it didn't sell, I'm like, it's done. It's done well, can find somebody. No, it's done time. Something else come up with something else.Phil:So, so major league baseball, right? We talk about at bats and swinging, you can go to bating practice. You can take swings, you can practice, practice, practice, but look at the best batting average. And in, in, yeah, the major leagues. And I'm not, I'm not a, a huge baseball fan by any stretch. I love sports and I love watching a good game and I'll sit down and I'll go to a Dodgers game or wherever I am to enjoy a game. But it's like 303. Hundred's amazing. Yeah. ThatMichael:Means, yeah. If you get on, if you get a hit, once every three times you are and I go into the hall of fame, basically.Phil:Yeah. You literally imagine. Imagine if, imagine if babe Ruth or Mickey mantle or whoever went up, struck out and said, that's it guess this isn't for me. I better walk away, better hang up the, the cleats and hand the glove off to that kid. Cuz I am not gonna make it. No, it is striking out and striking out, striking out until you finally hit one. And that makes you amazing. So yeah, none of us are gonna be perfect the first time how we talked about like the fact that if you were to start over and try to break in, you would be digital. Like you would go digital and try to put this out there. I received an email from someone in the course. I received an email from someone who was like, I don't think they're in the course. They emailed the support email.Phil:And I said, Hey. And there was to me. So they obviously listen to the podcast. So if you're listening to this, hopefully my advice was helpful. But they said, I am looking to get a short film produced. And I was just wondering like, what are the distribution? How do I get that out there? What, what should I do to make this the best possible? And my advice to them was before you put a dime into producing a project, you need to make sure you have a good script because yeah. A mediocre script shot very well, does nothing. So I would help absolutely take the time to make sure that what you have is worth shooting before. You're gonna go through the time and expense of making that thing happen. Right? Because although it's good experience for everyone involved to get out and short sort through the sound issues that inevitably come up and check, test your lenses and realize that you didn't have the audio on in the cameras. You can't sync your audio, et cetera. All those things are valuable lessons. It's much cheaper to make that mistake on paper and in your final draft or whatever you're writing with before you get on the camera before you have the record for the red. Yeah.Michael:Because what if you, yeah. What if you shoot it? And it's just media. If like the script is no good. So who cares? How well lit it is and how, how it looks like a movie and look who cares about the special, if it, if the story's boring, who cares? No, one's gonna be impressed about you, the, how you framed his scene or how the camera flew in or you know the who no, no, they're just gonna be bored. No, one's gonna say, wow, look at that sweeping camera shot. No one's gonna be impressed by the drone footage you put up there. Everyone has drone footage who cares is the story good? You know, that's all the people wanna carePhil:About. So what I said was I would, I mean, first recommendation was to invest in the course because you're gonna learn how to tell a good story once you're done with that. Yeah. You have a group of people who you send it to get notes, give feedback. And they're gonna tell you from the lens of proper story structure, what's wrong with this. And then you can hone that in. I even offered to read the script. I said, send it to me. I'll read it. I'll tell you if it's good or bad from my limited perspective. But I can say that now with a little bit of pride and say I'm at a higher level than I was a year ago. I'm at a higher level than I was six years ago when I graduated film school. Yeah. So at least what I'm gonna give you is closer to what a Michael Jamin note was gonna be on this project.Phil:Yeah. But that's the, that's the value you get when you're interacting and you have this group of people who are putting in the work and the time and the effort and they're doing it. Yeah. This, this is like, to me, this is like golf, right. We recently just did the Tacoma cup. We all went out and golfed. And I Mike rep, who was one of the writers on the show and I placed dead last. We were the worst on the team, right? He had to play in 15 years. I hadn't played in five years, but we were out there in a foursome, all teeing off, all hitting, all, supporting each other. But it's an individual game. I can't blame Mike rep for his bad shot. I have to take accountability for knocking a tree limb down on a tree, which actually happened. I don't know if I told you that, right. That's funny. But, but that's an individual sport supported by the people in my, for. And we had a great time. They coached me when I made mistakes. This is the same thing. So a lot of sports references today, but ultimately you have to get out, you have to take that bats. You have to strike out and you have to do that over and over and over again until you get incrementally better every single day,Michael:Look at the people, how they broke in and how they started. And you know, I certainly was humble. I did a post and I talked about something and and someone said like, well, Quentin Tarantino doesn't have to. And I'm like, are you Quentin Tarantino? Do, when you show up to the, the Ivy in your Maserati, do they mistake you for Quentin Tarantino? You know? No. So the rules, even though he does it one way, you're you haven't earned that right. Yet may, maybe you will. But right now you're not. And so start a little lower, start a little lower, you know?Phil:Yeah. I think being very aware self-awareness goes right along with self-reliance. I need to understand the facts of my situation. And that's that takes some time alone to journal and ask the questions. Where am I? Mm-Hmm what are my skillsets? If qu Quent Tarantino is a 10 and I want to be Quent Tarantino, realistically on a spectrum, where am I like?Michael:Yeah.Phil:Take account accounting of where you're at with the skill sets you need recognize where you need to shore up and where you need to focus and improve. Because if you're a 10 in coming up with the idea and you're a one on the execution, your average here is still pretty bad, right? Yeah.Michael:And it's a long road. So if one step at a time know that it's going to take years. That's okay. Is you're getting closer and closer with every step you take. So yeah.Phil:When you, you pointed, when you said it's like climbing a mountain is step by step. It was like, Everest has base camp. You have to there'sMichael:Yeah. They start, they start. Yeah.Phil:You have to get, you gotta camp, you got rackMichael:For your start.Phil:Then you start,Michael:Then you start,Phil:Right. Where are you on the journey? Where do you need to improve? Put in the time, energy and effort. And either way you'll, as you always say, you get to be creative, you get to be yeah. Centered and focused. And that alone is worth the effort and energy you're gonna put out.Michael:Yeah. Yeah. Because right. You're spending your time doing something you love. And if you don't love it, then don't do it. And if you're only doing it for the money, there are other ways to make money,Phil:You know, go sell or easier ways to make it you'll make. Yeah. You'll make a lot more money selling stuff.Michael:Yeah.Phil:So, soMichael:Michael, you wanna be a creative, this is how to do it. Yeah.Phil:My, I think, I think a very powerful episode today. I know it's a pretty short episode.Michael:I, yeah. Do the work. Yeah. Don't get ahead of yourself. Just, just start doing the work. Yeah. Yeah. But you don't have to write your Oscar speech yet that time.Phil:Yeah. Hey, you guys all want my social medias at Phil Hudson hit me up. I run a digital marketing agency on the side. I help some pretty influential people. Get their message out there. Yeah. Happy to answer questions. Just message me. Yeah. We'll talk about it. Okay.Michael:Yep. Yep. And that's it. All right. Everyone. Couple announcements. So I'll be touring with my show, paper orchestra. If you wanna come see me to your city and you wanna know where I'm gonna be go to Michael jamin.com/live, and I'll let you know where, where I'm coming to next. We're going to Boston next is my next city. And then back in LA for two shows in December. But we'll be, we'll be going other places as well. All right, everyone. Thank you so much. And until the next time.Phil:ByeMichael:Bye.Phil:This has been an episode of screenwriters. Need to hear this with Michael Jamin and Phil Hudson. If you'd like to support this podcast, please consider subscribing leaving a review and sharing this podcast with someone who needs to hear today's subject for free daily screenwriting tips, follow Michael on Instagram, Facebook and TikTok at Michael Jamin writer. You can follow me on Instagram, Facebook and TikTok at Phil Hudson. This episode was produced by Phil Hudson and edited by Dallas crane until next time, keep riding. 

The Remote Real Estate Investor
How investors can use private capital to scale with Derek Dombeck

The Remote Real Estate Investor

Play Episode Listen Later Sep 17, 2022 31:02


Derek Dombeck, a Real Estate Expert hosts and runs the WiscoREIA based out of Wausau, WI. There he coaches and teaches other real estate investors his keys to success. He is currently hosting 3 national Mastermind groups called the R.E. Circle of Trust and puts on an Advanced training and Networking event each winter called The Generations of Wealth Voyage. In the last podcast episode, Derek talked about creative financing solutions for real estate investors. In today's episode he will be tackling the other side of the coin and will share some insights about private capital, lending and how that plays into real estate investing. Episode Link: https://gowvoyage.com/ --- Transcript Before we jump into the episode, here's a quick disclaimer about our content. The Remote Real Estate Investor podcast is for informational purposes only, and is not intended as investment advice. The views, opinions and strategies of both the hosts and the guests are their own and should not be considered as guidance from Roofstock. Make sure to always run your own numbers, make your own independent decisions and seek investment advice from licensed professionals.   Michael: Hey, everyone, welcome to another episode of the Remote Real Estate Investor. I'm Michael Albaum and today with me, I have Derek Dombeck again on the podcast and for those of you who missed his first episode, I highly recommend you going back and giving that a listen. But Derek is the owner of best REIA funding a private lender, he's also an investor. So today, we're gonna be talking about private lending, and also what we need to know as investors and how to utilize it. So let's get into it.   Derek, what's going on, man? Good to see you. Thanks for coming back on the pod.   Derek: Yeah, absolutely. Glad to be back.   Michael: I'm super excited to have you on. So last time, we talked about creative financing solutions for real estate investors. Now we're going to be tackling kind of the other side of the coin and so talk to us about private capital and lending and how that plays into real estate investing.   Derek: Well, I like to talk to our clients that are coming to us for loans in more along the lines of what how would they want to structure if they were the lender? So it makes more sense to them why are we asking for what we're asking for? We design our company, primarily because we were borrowers ourselves, and we want to do it in a way that would be probed by our borrower, but still safe for our investors. So a couple examples, we don't collect monthly payments, we don't collect interest payments, we let it accrue. Very, very few lenders do that. The methodology is that when you're when you're the lender, and a payment is missed or late, that gives you an indication of something could be going wrong with the loan and that's true. But we don't want to have to collect payments every month on 175 outstanding loans, which is typically what we're carrying at any given point in time. It's another staff member that we would have to have basically just to do that do collections. So as a borrower when I was borrowing the money, that's what I would have wanted, right? As a lender, it's different. So a lot of times I'm trying to have these conversations with our borrowers, as I mentioned, in a way that shows them that we're their ally, we're not just somebody sitting across the big fancy desk with a, you know, a suit and tie on looking down their noses at them. We want them to really realize that we are their business partner, in one way, shape, or form. Most interactions with borrowers if they've never met me before, it just starts out with a brief overview of our loan program and I often tell them, well, if you were going to be the lender, if it was your money, what would you want to see happen, especially if they're, you know, if your listeners are out there trying to apply for loans. There's three things two to three things that I think are super important. First one is whether they're going to a bank, a hard money lender, or a private lender, or their great uncle, have all of your documentation ready to go. At the I mean, at the drop of the phone, right? Like we get off the phone, bam, you can submit it. What drives every lender crazy is when they send stuff in piecemeal. You know, and we always have to ask for it and then we have to remind them and follow up that makes you look so foolish in the eyes of a lender. Okay, another thing for us, we don't require appraisals, but most people do. So, and we don't require appraisals in our loans, because I don't trust appraisers. They have no skin in the game, we have way more experience. But we're in a niche lending market of lending on rehabs and some appraisers may never have picked up a hammer in their life. How do they know what the after repair value is going to be based off of a scope of work? You know, if I get a scope of work that's submitted on an application and they claim they're gonna put a brand new kitchen in for $2,000 I'm gonna call bull ** because I know what it cost to put in a low end, middle end or high end kitchen. But again, as a borrower trying to help your listeners in that regard. If you're going to an appraiser or you're coming to us and we don't require appraisals, but having your data somewhere you had to come up with your numbers, right? When you made your offer to buy the property, I want to see, an appraiser may not want to because some of them don't necessarily like to help. But I want to see, because, you know, some of them are just arrogant. Let's be honest at it.   Michael: It's the ego play, yeah…   Derek: It's an ego play. But for me, it's not for me, it's required. I want to see those comps, or CMA, or a BPO, from a real estate broker, something to show me how did you come up with your valuations? If it's going to be a rental property, where's your cash flow analysis, you wouldn't believe it how many times we get applications in and they want to rent borrow money from our short term to fix the property, get a tenant in there and then refinance. But yet they have not talked to any long term lenders, typically banks to even know what their refinance terms would be or if they'd be able to get refinanced. They haven't done a cash flow analysis. Again, have everything ready for your lender as much as possible, right? Gosh, what else as a borrower, you know, coming in with a backup plan, a plan B, is so crucial. Our job as the lender is to expect you to fail and every question we ask is, is asked, because we want to know, if something goes wrong? Can we either take the property back or lien against the, you know, the borrower to get our money back? I mean, that's what it's all about. We are asset based lenders, banks are gonna look at the asset and their income, every lender is a little different.   But the bottom line is, can we protect our investors' money? Can we protect our money and if that borrower walked out of closing, sign the papers and got hit by a bus and died? Can we recoup our money, right? Borrowers don't think that way. Borrowers think sun shines, and sunshine and unicorns, right. Nothing's ever gonna go wrong, the project is going to be on time on budget, we're gonna get under budget. You know, it's total bul****. But that's, that's our jobs to explain that to them in a way that's, you know, we're not trying to drive them from our business, we want to do business with everybody, that's got to legit good deal. But they've also got to be realistic and the number one, two spots that most borrowers come in sunshine and unicorns, their budget is too low on their renovations, and their comps are too high. So they want to use the top comps and we don't, why don't we because the markets shift. Now, if they came in on evaluation, I'm going to use Wisconsin numbers, you know, because that's what I'm used to, if they come in with an after repair value of $200,000 and I look at the comps that they submitted to me and there was one house that sold for 200,000. But the majority of them sold for 175. Which one do you think is the lender want to use?   Michael: Yeah, the 175.   Derek: Right, so we're going to lend based on 175. Now, that means they're going to have to put some of their own or more of their own money into the deal. If they sell for 200 bonus for them. That's great, I hope they can. But as the lender, we can't live on hopes and dreams, we got to live on reality and what happens most of the time is they're trying to come in with as little money out of their pocket as possible by using the highest comps, the lender takes on all the risk, which is why we use the middle of the road comps and I don't go to the very low end either. But we're using the middle and again, if they have to put in 10 20,000 extra dollars, and they're confident in their numbers, they shouldn't have a problem putting in 10 to 20,000 extra because according to them, it's going to sell for 200 they should get their money back and then some but when you start changing that or having that conversation with them. Boy, it's amazing when they have to use their own money, how they start to sing a little bit different tune.   Michael: Yeah. Interesting. So it's almost like you have to protect them from themselves.   Derek: Absolutely and we will tell them that I mean, there's plenty of times where we have just flat out told people you should walk away from this deal. Like we want to do business with you in the future. We want to give you a loan, but you are setting yourself up for failure on this deal and most lenders wouldn't typically do that most lenders will just say, we're only comfortable lending up to x, go ahead and do the deal and then when they fail, the lender will take the property back and the lender is in good position depending on loan to value. But we don't, I don't really like that model. I mean, it's certainly not our model and at the end of the day, if I take care of that investor, and I save them from themselves this time, hopefully when they come back around, they're more educated, and they bring us a really great loan, they've got a really great project. That's what it's supposed to be all about.   Michael: Yeah, yeah. Well, let's talk about that for a minute, Derek. So it sounds like the things that you asked for, from your borrowers. It's really an opportunity for them to showcase their experience level that they've taught, crossed, the T's dotted the eyes and really thought about it and in very proactive in that, what if someone's just getting started? I mean, how much hand holding should someone expect from their lender or can they expect from their lender to help them get to a point where they're feeling confident or do you tell people hey, you know, go kind of skin, your knees somewhere else, and then come back to us when you're a little bit more polished?   Derek: So the answer is, it depends. There's, most lenders out there do not want to deal with brand new people. I mean, it's just a reality of life. We are different in that regard, too because we may say to the applicant, alright, we want you to partner with somebody, and that person has to have, you know, we'd like to see at least three deals worth of experience. Now, I don't care if they get mentored for free, or if they split the deal 50-50. I don't care what that partnership looks like. But we would like to see somebody with experience that is backing this deal and if they can't do that, or they don't want to do that, then we typically would say sorry, but we can't lend on this deal right now and if they don't know anyone else, which happens, we have an extensive network throughout the state. So we can pretty much in any market, we can line them up with somebody that would be willing to, to mentor them and get some feedback from them. So but I don't think there's a whole lot of lenders that would do that much hand holding… Yeah, you know.   Michael: And that makes sense to walk us through because you're a private money lender. So you are kind of this middle person where you take investor money, and then lend it out to other investors that are that buying real estate. So when the Fed talks about interest rate hikes are this sort of thing? Like, how do you set your pricing and what should listeners be expecting if they're going to private lenders in terms of rates, right now, we're recording this almost near early September and August 2022. What are you seeing an image of you'll be expecting.   Derek: So it's very volatile, depending on where you are in the country, and how much competition there is, we certainly have national, hard money lenders that are that are, you know, advertising, much cheaper rates than we offer. But they sell off their loans. Almost many before the ink was even dry. They're white labeling almost everything, which means that there's a hedge fund or another note buyer, that is fronting the cash to close the loan and at the closing table, that loan gets transferred and you know, the person that you signed the paperwork with may still be the servicer of the loan. So you may not even realize it's been sold off. But most of the national lending companies, that's what they do. The challenge with that is, when the borrower gets to any kind of a challenge, we'll call it with their loan, maybe they need an extension, or something's just going terribly bad. Those lenders are not going to be willing to work with them because they don't own the loan anymore. It's gone. It's in some hedge fund on Wall Street, and it's just a number. It's just a loan number, they don't care. They just okay, you failed, get out, we'll take your property. As private lenders, we don't currently we don't sell off any of our loans.   We are 100% privately backed, so I don't have any institutional money at all. That has their thumb on us telling us what we can and can't do and our investors are all individual people there, some are mom and pop. Some are, you know, a little bit higher net worth individuals, but we can have conversations with them. So for example, let's just assume that the markets crashed and 20% of our portfolio defaulted and we had to go take these properties back well, if the market isn't really viable, viable option to sell them off and be made whole, we can go to our investors and we've done this with all of our investors. Prior to them even getting started with us, we have this conversation, but we can go to them say, okay, you know, we still myself, my business partner still run a full time real estate acquisition company, we have rentals, we have everything in place. So we're gonna have to take these, you know, whatever it is 20, 30, 40 properties, and we're going to lease them out and we're going to just collect rents until the market comes back and our investors are, that's not their first choice, but they're okay with it, because they know it's a Plan B, I mentioned that before, you know, the, the borrower's don't want to come in with a plan B or Plan C, we've got that in place with all of our investors upfront and, you know, we pay our investors 9% currently, maybe they would have to agree to go down to 7% or 8%, it would have to look at the cash flow numbers. But that's still better than the alternative of losing money.   Michael: At zero, yeah, zero or negative.   Derek: As far as rates are concerned with us, what we pay our investors dictates what we charge and at 9%, we've got a three to four point spread on interest rate. So we charge 12%, throughout the bulk of the state of Wisconsin, and we charge 13%, currently in Milwaukee and it's really just to be 100% honest with you and your listeners, Milwaukee, we could probably charge more, because our competition is charging 15%. So we don't really have any intentions of increasing our rates, we don't have a lot of junk fees, that's another thing your listeners really should consider looking at when we're looking at any lender, the interest rates might be much, much better, but their junk fees, I know of a lender within my state, who charged something like $3,500 to get paid off. In order for you to pay the loan off, you had to pay a payoff fee, which is asinine. We see a lot of lenders that are charging several $100 to do a construction draw, or a loan or an escrow draw for your construction proceeds, that's your money as the borrower and you now have to pay three, four or $500 to get your money out of escrow. It's crazy, you know…   Michael: I've seen that.   Derek: All these fees are they're nuts. We do charge an extension fee if they go past our six month term and it's equal equals to what if we weren't able to redeploy that money and another 12% in three origination points. So for an extension fee, for us, it's a point per month, up to three more months. Why because we want that money back to redeploy it. So we could charge three more points, right? So but it's not some 10 points in some crazy, crazy astronomical numbers, it's really just trying to get our same level return on our money, whether it's extended or redeployed to a new loan.   Michael: Okay and people listening might be getting excited about using private money, because it sounds like so much more flexible, and just investor friendly. Other people might be a little bit scared hearing this and so I'm wondering if you can talk to if those people are listening, can they get involved on the investor side of things where they're funding other people's deals, and just clipping that 9% coupon or whatever the return is?   Derek: Yeah, absolutely. I mean, if whether it's with me or with somebody else, I'm more than happy to talk to anybody about it and if you invest with us, you do if you don't, I don't, that's fine. But I would say there's some very important things that everyone should know if you went and borrowed money from your family. Okay, so maybe they're talking about a private lender being an individual that they have relationship with, or they might be using somebody's retirement account. I've seen this happen so many times, it makes me cringe. There was a couple young couple, I mentored them years ago, now they're, they're super successful, but they were just getting into the business and they were, they bought a flip house and they said, We borrow the money from my uncle at 2% and we can pay it back when we sell the house. So that's fantastic. That you know, this was back before 2% was popular, right? Yeah and I said, okay, did you put a note and a mortgage in place to protect your uncle and they said, no, he didn't care. He just said, pay me back when you get it, you know, when you get the money? I said, okay, do you have the property insurance? You know, the listing them? In case the place burns to the ground? Nope. Did you get them title insurance? Nope. All these things like they did not protect their family at all. So picture them getting sued by a contractor or anybody. Here's a free and clear property without a recorded mortgage against it and not and they lose it. Let's say we lose a lawsuit property gets taken away from them. Now they still owe their uncle all this money, and he had nothing to protect himself or we go back to the they get hit by a bus walking out of the title company, right?   Property, the money's gone, the money went to whoever they bought the property from, how does that family member collect or get their money back, if they don't have a mortgage in place, they can't foreclose on the property... So I just caution, anybody that's, you know, on the borrower side, that's going to borrow money from friends or family, make sure you always get title insurance to protect your lender. You know, the property insurance, the lender should be listed as a lender, not as an additional insured, there's a big difference and, you know, go through a title company, go through a closing attorney, make sure everything's aboveboard note mortgage in place, or deed of trust, depending on your state because you're just, I mean, you're hurting your family if you don't do it the right way. So always, always, always protect your lender, no matter what and if you're going to take a loss on a property or a project, I don't care what it takes, you make sure your lender is made whole, because we've lent money to people that screwed up their deals, but they took care of us and next time around, we lent the money again but you got to take care of your lenders. On the other side of it, if you want to be a lender, there's a lot that you have to consider just the whole underwriting of the deal. Is it a good deal? Is it not a good deal and how are you going to make sure that you get paid back are you going to have third party that goes there and make sure that the property is being managed, right, or if it's rehab, or you're gonna have somebody that's checking on the project and releasing money on construction escrow drawers. If you do want to collect monthly payments, who's going to do that who's going to service the loan. So there's a lot of things that it don't get me wrong, it's a great business, but there's a lot of things that people don't necessarily think about and I've seen it happen enough times where, you know, somebody has 100 200 $300,000 sitting around, and they just do a handshake deal, and lend the money to somebody, again, not getting the proper documentation in place. We had one ***hole and I say that, because he really was an ***hole, he took money out of his disabled brothers, IRA, to fund a rehab project and he had three other lenders on that project and he never he told his lenders, he was going to record all their mortgages for them and he never recorded the mortgages and it turned into this in this really nasty lawsuit. But he lost his disabled brothers IRA in that transaction and he's just the snake, you know, and they're out there. But you got to protect yourself. You know, I still believe in taking somebody at their word and believing the handshake. But that doesn't mean you don't write down and memorialize what you just shook hands about.   Michael: Right and if someone wants to get involved in the lending side of things, but you know what, you just said, what you just shared kind of makes them a little bit gun shy, or they want to have someone else take care of the day to day operations. I mean, are there businesses that they can plug into it? So here, take my money, pay me a return, I don't want to hear about it or know about what you're doing with it.   Derek: I mean, there is there's a lot of crowdfunding companies that you know, that became very popular. It seems to have died off here lately. You know, I don't hear as much or see as much marketing about crowdfunding. I would say the best way to do it is either find somebody in your local market at a RIA meeting, or, you know, a meetup group or even online, Bigger Pockets or something like that. But you got to spend some time getting to know who you're doing business with and, you know, Google the hell out of them, do background checks, all that kind of stuff. I invite anybody to Google me I have nothing to hide. You know, I'm never I just, I never tried to screw anybody over you know, and I mean, yeah, and it shows. But at the end of the day, you've got to know, this is I don't think this will ever circle back around. But I was invited to be on somebody else's podcast and I won't say the name. But then that gentleman was having a four day online conference and he asked me to speak for 90 minutes on this conference and I said, yeah, absolutely, I'd love to do it. He was expecting, you know, four or 500 people and so I was gonna send it out to my email list and help advertise it for him and it wasn't out there for 30 minutes, and two of my closest friends, one being a really good attorney were emailing me saying, Have you lost your fricking marbles? Like this guy is the biggest con artist and scammer there is and he actually the attorney sent me case studies of actual cases that this guy lost, and how he's not in jail, I don't know and I was just, you know, took and took him at his word. He's got a reputable podcast, right? So I'll go and speak on his conference. Well, who will you associate with can reflect very horribly on you, especially on social media. So I didn't mark it to anybody at that point, I still, I still spoke because I said I would and I believe in you know, I gave my word and I and there was a lot of other speakers at that event that were good. But I would never do business with that man and so that's the same thing. If you're going to lend money, or you're going to borrow money. Do you want to borrow money from a lender that doesn't want to be flexible if you run into trouble? Yeah, for us, we've only had to foreclose on nine properties in the last 10 or 11 years of lending, which is, is very, very, very low as far as the default rate. That's not to say we haven't had other people that had problems because we have, we have borrowers that have problems every week. But we're there to help them work through it, versus the lender, that's lending money as a backdoor way of getting properties.   Michael: It's a much more adversarial relationship.   Derek: Right, so you got to vet your lender, no different than if you were vetting somebody that you're going to invest with, we have a very clear in writing no ***holes policy within our company. I swear to God! Michael: I love it.   Derek: If I have somebody that and this has happened, I've had people that had several million dollars that approached us and said, We want to invest in your company and after half an hour, 45 minutes of talking with them, we just knew they were going to be the biggest pain in our *** and we turned them down. Same thing with our borrowers. If our borrowers stopped communicating with us, and stop doing what we agreed for them to do, then the ***holes  policy kicks in and we will have to default we will have to foreclose or at least we're not going to give them a loan next time. But the life is a lot better when you wake up in the morning and enjoy doing what you're doing and dealing with people that are not fun to deal with takes away from that. Yeah, we just don't do it. You just avoid it entirely. So I'd love to work with any of your listeners, unless they're an  *hole. Don't call me.   Michael: Okay, fair enough. Fair enough. Derek, on that note for people that do want to reach out that do want to work with you that have more questions about private lending, what's the best way for them to do so?   Derek: My, my personal email address is Derek spelled DEREK, @ bestreifunding.com (Derek@bestreifunding.com)  and I keep an eye on my own emails, my if I miss something, my assistant will grab it. But I'd love to chat with anybody that's got questions and again, it's this isn't a sales pitch. I mean, if somebody just says legit questions about lending, and they have no intentions of wanting to work with me as an investor, whatever, that's totally fine. I don't it's not about that for me and then the other thing I'm writing a book right now about lending in from start to finish. What happens when an application comes in all the way through closing and servicing after the fact and that's going to be coming out towards the tail end of the year, November December it'll be published. So I'd love to give your listeners that for free the electronic version for free.   Michael: Awesome.   Derek: So they just send me an email that same email address (Derek@bestreifunding.com) , and say, hey, I heard you on this podcast and put you on the list when the books published we'll get it out to you.   Michael: Fantastic. Thank you so much and I just have an ask for all of our listeners that do reach out to Derek if you wouldn't mind please referencing that you heard him on the Remote Real Estate Investor in the subject line. So he knows where you're coming to him from. That would be super helpful.   Derek: Absolutely.   Michael: Well, Derek, this was great, man. Thank you again for coming on the show. Really appreciate it and I'm sure we'll be chatting soon. Can't wait, can't wait to read the book.   Derek: Yeah, I can't wait to finish the book because it's great when you're writing a book, except some weeks are more stressful than others trying to hit deadlines and stuff. So I'm looking forward to it, but I'm really looking forward to it being done, too.   Michael: I can imagine I can imagine. Well, hey, man, we'll definitely be in touch soon.   Derek: Awesome. Thanks so much for having me.   Michael: You got it, take care.   All right, everyone. That was our episode, a big thank you to Derek for coming on again and sharing his time and knowledge with us. As always, if you enjoyed the episode, feel free to give us a rating or review wherever it is eat your podcasts, and we look forward to seeing in the next one. Happy investing…

The Remote Real Estate Investor
Leveling up your real estate business with Mike Simmons

The Remote Real Estate Investor

Play Episode Listen Later Jul 19, 2022 43:27


Mike Simmons, a real estate investor, author of the book Level Jumping (linked below), has shared the stage with some of the greats like Gary V. Has made over $1 million in profits in 12 months!! He knew he wanted to invest in 2003, and bought his first flip in 2008....why did it take so long? Like a lot of people starting out Mike was afraid to tell his spouse because of the difficult conversation. It wasn't until he finally decided he was tired of allowing fear to be his excuse that he dove in. Today, Mike shares his inspiring story of how he left his job, entered the real estate world professionally to begin wholesaling and flipping houses. Episode Links: https://www.mikesimmons.com/ Level Jumping   --- Transcript Before we jump into the episode, here's a quick disclaimer about our content. The Remote Real Estate Investor podcast is for informational purposes only, and is not intended as investment advice. The views, opinions and strategies of both the hosts and the guests are their own and should not be considered as guidance from Roofstock. Make sure to always run your own numbers, make your own independent decisions and seek investment advice from licensed professionals.   Michael: Hey, everyone, welcome to another episode of the Remote Real Estate Investor. I'm Michael Albaum and today with me, I'm joined by Mike Simmons, author, CEO, business coach speaker, and we're gonna be talking about Mike's business, wholesaling and flipping houses, and what we should be aware of if you're going to get into either of those businesses. So let's get into it.   Mike Simmons, what's going on, man? Welcome to the real estate investor.   Mike: Thanks for having me, I appreciate it.   Michael: Oh, my gosh, no, the pleasure is all mine. Super excited to have you on and really excited for our conversation today. So Mike, I know a little bit about your background and a little bit about what you do but for all of our listeners who are not familiar with you, give us a quick and dirty who you are, where you come from, and what is it that you do in real estate today?   Mike: Yeah, no problem. So, you know, I always say that my background is probably the least remarkable. I didn't sell baseball cards, I didn't go around the neighborhood looking for lawns to mow or things to do. I was a normal kid, probably on the lazy side. You know, and my parents were, we're in the automotive industry, and we're very blue collar Michigan, right. So the life that was displayed before me through example, and through explicit, you know, direction from my parents, and the Blueprint was, you got you finish high school, you go to college, or just as maybe even more preferable, you get into a union factory type of environment and it's very secure and you work there for 30 to 35 years, and you retire and you hopefully save some money and you scrimp buy and that's how you that's how life goes. That's just life. That's what people do, that's normal. Yeah, there wasn't one single person in my family or anybody on the horizon that was doing anything remotely entrepreneurial. So I did that I went to school, I went, I finished high school, I got a job with UPS, Teamsters, my parents could not have been happier with me being in the Teamsters and I went down that path, and I got married young, and I was working at UPS and like, unfortunately, UPS is a great company.   But there are injuries that happen because people you know, lift wrong and all that and at 25 years old, 24 years old, actually, I couldn't get out of bed in the morning without going to the chiropractor three times a week as a 24 year old, otherwise healthy man, oh my gosh and I knew I couldn't retire from there, because I was already almost too hurt and crippled to do the job I had to do at that time and I was in my early 20s and so I got another job in the automotive industry. It was a desk job and I started working there and this was, we were the mid to late 90s at this point and the automotive industry, like most industries, were starting to decline starting to have some problems. We were heading toward 2000 where a lot of bad things happen and in, you know, people think about tech and what happened if tech the big boom that happened. But the same thing happened in the automotive industry, essentially, we went from, you know, booming industry to many, many suppliers, going out of business struggling, it was really bad for a while and so I had to look around and ask myself, and I'm one thing I'm good about one thing I one of my superpowers is I'm a very honest, and I can I can very objective about myself and part of that is because it can be a tough thing to do. It's most people I don't think are, are objective about themselves and I'm not saying this to brag, I'm gonna tell you why I'm objective, and it's gonna kind of be like a poor, poor guy. My dad was a Marine, and, and he made it real clear what our shortcomings were on a daily basis as kids and so I have no problem. being real, honest, in a way that say, these this is what I'm not good at.   This is what's not great about me, like I'm very aware, I'm very easy for me to for me to figure that stuff out and so I asked myself at this point in the automotive industry, and things were declining, I didn't have a college education. I would I hire me if I were without a job and I was in the position of HR and I was, you know, somebody like me was across the table. What is there anything about me, that makes me more hirable than the 1000s of people who've been laid off over the last few years and it was easy. There was nothing about me that was remarkable. I had no college experience and I had very little practical experience. So why hire me when there's so many really, really talented people that were being laid off because of the industry. So went back to college, got a degree and I was working I'm kind of fast forwarding a lot, but I got my degree and I doubled my income. Like the minute I retire, graduated, the minute I graduated, I got a job, which literally was twice the annual salary and I was like, here we go, baby. There's no stopping and so just to kind of illustrate how that went, so I went into a company, it was automotive and I was working there for about six, seven years and at one point, it's seven o'clock at night and it's everyone had gone except my team. Everyone had gone home for the night, obviously, it was a five o'clock, most people were gone. It was seven 30 and I'm in at work and there are our client is there too, because there was something going wrong with our program that we are working on and he's there and in we're discussing the problem, and the guy gets really agitated the client, I'm not going to say which automotive company I'm talking about, but it rhymes with board.   Break company, I have an F 150. But he gets in my face and basically start screaming at me like dressing me down, like very much, really like when I was a kid like my dad did write down. Yeah and he was and it was seven o'clock at night. We're all working overtime. We're all clearly busting our butts to solve the problem and he gets in my face. They're screaming at me and he's the client, right? He's a big client and I can't really say anything back, except I'm really sorry. We're working on it and after he walked away, I went to my manager who was there too and I said, what are we doing here? What is happening right now? Why are we here? I'm getting screamed at we're doing our best, like there are issues I get it but nobody, nobody was negligent. We just have we have things that have happened, and we're working through but why are we still here? We should be at home and he said to me, I'll never forget, you need to get your priorities straight and I thought you are correct. I absolutely do, I have young children at home, I have a wife at home. I've been working overtime all week on this project. I didn't say this but in my mind, I'm thinking, you are correct, my priorities are wrong and from that point, I decided to take my side hustle that I was doing, which was real estate, flipping houses not doing a particularly great job at it, but just kind of stumbling through it and I said that is going to become my career priority. My priorities need to get dialed back to my family and make sure I'm at home and I'm spending the evening with them. I'm eating dinner, putting my kids to bed but from a career standpoint, that now becomes my focus and I will get my priorities straight and so he essentially put me on the right track. Inadvertently, he obviously was referring to work priorities but it worked the other way and so I from that day, I started making my side hustle, my main focus and I will say I a year later quit my job and the first year that I was in business and real estate full time that listen to this, this is true and I did this math, the first year that I was in business full time for myself as a real estate investor, my company's gross profits were equal to the total sum of my salary for the previous 25 years that I was working for somebody else, year one, which was a million dollars, I made over a million dollars in my real estate and over the years, like I'm talking going back to 18. When I started working right, I was making very little money and in the middle, I wasn't making a ton toward the end, I was making more but if you just take the average, which is about $40,000 for me, and you times that by 25 and is $1 million. My company grows that in in one year.   Michael: That's crazy, Mike! So where did you take it from there? I mean, are you still flipping houses today where you focus exclusively on that? Give us give us the insider scoop?   Mike: Yep… Yeah, good question. So I was flipping houses. When I was working full time, my wife and I were flipping houses and like I said, we weren't doing a particularly great job of it because she worked full time as a teacher, I was working full time plus as an automotive person and we were getting flips done. But we weren't particularly profitable, like we should have been. We didn't have any processes in place. My wife is extremely risk averse and so I kept trying to do more and do it faster. And she was slowing like brakes, brakes, brakes, right because she was nervous that we were getting ahead of ourselves and she probably saved me from really screwing up bad in the beginning. But at some point, she said, You know what? This is great and you clearly love it. I don't love it as much as you do. In fact, this is making it hard for me to sleep and it's making me hard for me to focus on my day job with the kids and I'm a teacher and that's what I do and I love you, I love the I love real estate but it's the roller coaster, the mental roller coaster is too much and I really would rather you go on without me and let me pull back and I'll just cheer for you from the sidelines and I totally support you and this isn't a negative this is actually a positive I just trust you to do it better without me and I did in and that's when things started taking off because I started doing way more activity like before we would get a house under contract. We would get it quoted out, you know, we would renovate it, we would put up for sale, we'd go through the wholesale process closed, check in the bank, before we started looking for the next day and that's not really a that's not how you scale anything, right?   So when she backed out, I was like, okay and I started putting offers in on multiple houses a day, like I was putting offers on everything and I started getting multiple deals at one time and so I had to learn how to raise money and I had to learn how to manage groups and what a forced me to do was, it forced me to come up with a process in a system that was repeatable and could handle scale. Before that, nothing we did was scalable, is all very manual, we'd go to Home Depot, we'd pick new colors for the walls, we'd pick out different cabinets, different flooring, like everything was custom to the house that we were working on and what I realized was really, really good house flippers who do it at scale, okay, and I'm not talking boutique flippers, who go into a town and they buy a $3 million, you know, historical home, and they like, put it back together with love. It's I'm not talking about that I'm talking about the people that are flipping 20-30 at 100 200 deals, they are not falling in love with every single house and going in there and making it the route, right, it's turning burn a little bit and so I learned how to turn and burn a little bit more in my business and scale it in a in a way that had systems and processes. But I still hadn't hired anybody. It was still just me, what changed the game for me and that changed the game for me in terms of, you know, a racing analogy, but, and again, this is not like I said all this in front of my wife as early as like the last month I've said all of this and she 100% agrees but she was like the governor in a race car, right? They put the restrictor on there. So you can only go so fast. Once that got pulled off. I pushed the gas all the way down to the floor, and I never stopped like, and so things just go faster when you're doing that much volume and back then, you know, now we're talking about 2014 ish timeframe. It was easier to get deals, I'll be honest, like, as someone who coaches people in real estate, I'm not gonna lie. It's harder now than it was back in 2014.   Still possible now, but it was easy back then. So I was getting deals off the MLS and it was going pretty fast. Fast forward another year or so and it started to get harder to get deals off the MLS and I was struggling a little bit and so I had to do some research and figure out and I was I was going to all the meetup groups and I was asking all the other house flippers like, where are you guys finding deals like what's happening? Where are you guys getting your volume from and they were all like, man, it's hard, like we're not getting deals like we're struggling and I'm like, Well, where are you looking? Where are you trying to find deals and everybody said the MLS everybody. I only knew one wholesaler in my market and I reached out to him. I'm like, Dude, I know you're not buying off the MLS. So where are you finding deals? He's like direct mail, I'm going direct to sellers and I'm like, what do you mean, go direct to sellers? How do you do that and so I took him out to lunch. He gave me the down and dirty playbook for how to do direct mail is what I was doing at the time and I started doing that and the deal flow started happening again and I started building and what I realized was and there's a whole story behind it that we don't necessarily have to get into but I changed my model from house flipping to wholesaling and it wasn't because of that guy. To finish in a nutshell, I was overly dependent and this is a huge mistake that new investors make all the time. I was overly dependent on one contractor and one realtor, they were everything the realtors, he found all the deals for me and they ran the numbers and they told me what was a good deal and my contractor was my only contractor and he basically made her are broke my rehab and on the same project as chance would have it. The realtor missed the numbers pretty badly and my contractor started flaking.   Now if you flip houses or renovate houses, or you have rentals, and I say my contractor flake, you probably don't need more information than that you go I'm with you, my contractors flaked too, right. But essentially, he stopped showing up he started charging me for things that he wasn't doing. He started making up half truths about stuff that he did do and so I was forced it and by the way, I was getting deal flow because I was direct mail, right. I had to let both these individuals off my team, to say the least and I had no backup plan and so as these deals were coming in, I reached back out to my wholesaling friend, I'm like, What do I do? I don't know how to wholesale. Can you just tell me what that even means? Like, what do you guys do and he again, gave me the down and dirty playbook and I called a house flipper friend of mine who I had recently talked to and he's like, I can't find anything and I said, Hey, man, I got this deal under contract. Do you want it for 110,000 at the time, that was the price 110,000 he's like, let me take let me look at let me look at the numbers coming back in 10 minutes. He's like I'll take it, I got it under contract for 95,000. I made $15,000 in like 10 minutes and In Michigan at that time, a normal flip 15 to 20,000 is a good flip number. Right, profit. Yeah and I was like I made almost the entire profit with a phone call. That was cool and probably a lot easier sold.   So much easier to do. No, by the way, no contract, right? No realtors. So I got another deal under contract. Ironically, it was also a contract for $95,000 and it was in a similar neighborhood. I called the exact same guy and I told him the exact same thing. I've got a deal for 110,000 It's yours. He said, give me five minutes. Call me back, he said, I'll take it. This all happened within four weeks to deal. I was like, I felt literally talked about love at first sight. I was in love with the model of wholesaling and so I switched my model over to wholesaling and I started, I started scaling it up and what really changed everything for me though, because although I was scaling up and I was starting to have some success, I still wasn't really running it like a true business I was I was a little bit scattered, I was a little bit unfocused and I joined a mastermind, a friend of mine at the time who lived in California, he had a podcast, and I knew him just through podcasting, and I was listening to his podcast one day, and at the end, he signed off, thanked his guest signed off, and I was doing dishes actually, at the time in my house and I saw I let it go, it was it's just kept going because I wasn't able to turn it off. My hands were wet and if it was over, he goes, Hey, if you're still there, I want to let you know about this very exclusive opportunity. I am pulling together some of the best real estate investors from around the country. We're going to form a mastermind, we're going to share ideas, we're going to help each other it's going to be awesome. If you want to get involved, you know, send me an email, whatever.   So I did $25,000 mastermind. Well, I $25,000 bazillion dollars to me at the time, but I was I was doing wholesale deals, right and at the time $25 was like two wholesale deals because I was averaging around 12 $13,000 per deal and I thought, I mean, if I surround myself with these people, will I do two more deals as a result of the relationships and the knowledge that will be exchanged. It seemed reasonable that I would and so I joined and I met someone their mentor, more than one person, but one person in particular, who laid out his company, he just laid it out. This is how I run my company is exactly what I do is what I did right and wrong over the last decade and he had the company I wanted and I said to him, his name's Andy, I said, if I if I see what you did, and I see what you're telling me, I should do and I totally agree with you. But you took you 10 years if I knew everything that you know now, and I apply it proactively. Couldn't I condense that timeframe? Like could I do any year and he said, I don't see why not? That's exactly what I did and I sort of came up with this term that, that I didn't think about a much until I've said it on podcast, and people resonate with it but I think the most powerful thing you can do in business is to use other people who are successful use their hindsight, which is 2020, as they say, right, as your foresight and so I used Andy's hindsight, all the things he did right and wrong, as my foresight going forward and I was able, that's what I was telling you that first year that I was doing the full time because I applied all of Andy's principals and I went from doing a couple of deals here and there to 10 to 15 deals per month and scaled up to a million dollars in that first year.   Michael: That is amazing and so right now your business is focused exclusively on wholesales, are you still doing flips?   Mike: Historically, it's always been wholesales but recently, and I have a business partner to its which is a whole story in itself kind of interesting about hiring and identifying talent. But so my partner and I have started strategically buying properties outright and then doing in Michigan, what we call them land contract, or we basically play the bank, we own the property, and we sell it to them and we hold the note as a company. So we started doing a lot of that. So we do like 100 deals a year, but half of those or more, but at least half would make fantastic land contract deals for us and so, and because of you know, COVID kind of showed us this a little bit and over the last several years that we've been in business, every business has ups and downs every industry has, you know, markets go up and down, right. So revenue kind of fluctuates and we thought how do we level that out a little bit? How do we make the valleys much higher, you know, so they don't go down and so we're doing a lot of this land contract stuff because it's every it's like you know, monthly recurring revenue and so we make the valleys much shallower and the peaks are still there. So we're probably wholesaling half of our deals and the other half we're buying inland contracting out…   Michael: Okay, let's dig into land contracts live because it's just not something I know very much about and we always joke on the podcast that we get to ask self-serving questions of our guests... So walk our listeners through asking for a friend walk us through like how land contract works and why it's so wide, so interesting.   Mike: Yeah, it's pretty straightforward but the concept and I'll kind of give you a peek, like a little bit behind the curtain here, right? The real like mechanics or the real like logic behind it. Me and my partner both as of a year ago, I had about 25 rentals, okay, which I have sold recently and I did it for a couple of reasons. Now, because rentals aren't great, they're great and actually, the rents are higher now than even when I sold them. So rent rents are going up, which is awesome. But for me, I bought them really, and I bought them like 2015, most of them and so the equity in them was very tempting to tap into and I recently have started doing lending on a grander scale, like I've scaled up my lending company, and I wanted to put that equity, that money into my lending company, it's just more of my focus now. But so what we're doing with land contracts, and why one of the reasons why we love them is unlike a rental, we are not responsible for any maintenance, any vacancies like we are, what the bank is to your mortgage, we get the mortgage payment, regardless of whether or not they have a leaky roof or whatever has to happen, right, we don't have to deal with any of that stuff and what we're able to do at least in Michigan, this doesn't work necessarily everywhere, the same way, because the rents aren't high enough in the house prices aren't low enough for to work in a lot of areas.   But for us, if you take someone who's living in a neighborhood, and they're renting, and let's just say they're paying for the sake of round numbers, they're paying $1,000 in rent, okay and they're renting a certain level house in that neighborhood, I can buy a house in that neighborhood that maybe is a little bit in distress that I can go in and buy it inexpensively and put some work into it and if someone were to buy that house with a traditional mortgage, especially a year or two ago, when rates were like high twos, low threes, they could buy that house and their mortgage payment might be $600, right, right. But they can't get approved for a mortgage for whatever reason, right? They have bad credit, or whatever it is, right? But I can buy that house, I can renovate it, and I can sell it to someone and really the pitch to them is listen, you want to own a home, and you're not currently in a position to get approved for a mortgage through a traditional mortgage company. But what if you could have homeownership, and you would pay no more than you were paying when you were renting, right still give me $1,000 give or take. But you own the home and you can build equity and in three to five years you can refinance out at a lower rate and you can own the home and probably drop your payments a little bit. Is it important enough to a person to own the home? If they're if all things being equal rent 1000 I have to pay this company 1000 for the house, but I own the house. That's what we do we buy the houses now, the reality is the interest rates are a lot higher than what you might get at a mortgage company, right. But we're also taking a bit of a risk. These are folks that have defaulted on things in the past and their interest and their credit scores are not great, but they have homeownership at this point and if so they if they have a down payment, and they want to own a home, we can get them into a home for no more than they would pay to rent a home in that neighborhood and three to five years, the goal for them is to fix things in their life and be able to refinance out at a lower rate and move on forever and then. So we're typically an average deal for us might be, you know, we buy it for 50. The ARV is 100, we put 20 into it. So now we're into it for 70 and we sell it for 85, right, we're still a little undervalued. So they're getting some instant equity, they have home ownership but when they go to refi in three, five years, we're getting a $15,000 check or whatever it is at that point, right. So in there's no calls from tenants, and there's no vacancies and none of that stuff. So that that's the that's the allure for US interest…   Michael: Interesting, I mean, isn't that similar, like rent to own or is it different?   Mike: It's similar, but they're not renting, right? a rent to own it, depending on how it's structured. Obviously, you can have some portion of the rent go toward whatever, but you still own the house, right? You still own the house as the person who's having that rent down. We don't own the house, necessarily. We own it, just the way the bank owns your house when you have a mortgage, right. But we're never getting calls from the city for law for Tallgrass. We're not getting calls about the maintenance issues or whatever. We don't have to worry that they didn't, you know, they left and they didn't finish their contract like it's a mortgage and if they if they don't pay their if they don't pay their mortgage, then we will foreclose we can foreclose on them.   Michael: Yep, interesting and so that like when you place these tenants into the home, there's a recorded sale that happens and so you're literally just playing bank, interesting…   Mike: Yep, just playing bank. Yeah, because we both had rentals, both of us and like I said, rental they're awesome but there's just a different level of responsibility for us playing the bank than then playing landlord and that's just what we're choosing to do. We both of us have rentals and it's, it's awesome. I rentals have been fantastic for me. It's just, it's not what we're doing now and we were just like, gonna get rid of the rentals and just wholesale. That's it but then this model presented itself, somebody we mutually knew in the industry is kind of like, hey, I'm doing this and they're doing it in Texas and it works down there too. I don't know that it would work in Los Angeles or San Diego or I don't know that it would probably not as well because the house prices but if you have house prices that you can get a house in a nice in these are like safe blue county collar neighborhoods, we're not talking about like war zones, but by any means I wouldn't buy a house there but in a nice blue collar brick ranch neighborhood, if you can get a house between 50 and 150,000. It could work when they start getting up to a half a quarter of a million, it just doesn't work as well anymore. You can't, the numbers don't work out.   Michael: Okay, okay. Good to know and just out of curiosity, I mean, how many folks end up refinancing out of your mortgage and then truly then own the house versus how many what percentage defaults or you have to go through that?   Mike: Really good question. We started doing this, like, eight months ago. So okay, I don't know, we don't have a loop. Yeah, but the friend of ours who kind of introduced this concept to us. He said about half of them refi out. Very few defaults, very few defaults because it's home, you know, people it's their home, right? They don't default, like they do necessarily on a lease, because it's not as transient. So according to him very few defaults. But we also screen people pretty well to like you would with a rental, like we're not just letting anybody in there, right? If they clearly have a pattern of defaulting on everything they've ever done, we could expect to default to we're not special but people have certain circumstances where their credit cut takes a pretty good hit but it's you know, it's something that is understandable, or it has a you know, story behind it. That makes sense. So I'm not expecting a lot of defaults, how many people will refi out? You know, our plan is to be a little bit more proactive with helping them with credit repair right now, we're not really getting involved in that but I suspect as we do get more involved with helping with that, that the number of people who actually refi out will probably go up, you know, so I don't really know right now how that's gonna go down. We'll see, we'll see how that goes. I don't know. Sure…   Michael: Okay, we'll have to have you back in 24 months to see. See what that looks like…   Mike: For sure, for sure.   Michael: Awesome. Well, Mike, let's shift gears here just for a moment and talk about wholesaling because, I mean, like you were mentioning a bit ago, it's no surprise that deals are a bit tougher to come by today. I think in the industry as a whole it's probably no surprise that wholesalers don't have the best reputation out there. Yeah, so I mean, I have I'm going to share kind of my thoughts on I think what makes you different but curious to get your thoughts and share with our listeners, me what makes you different as a wholesaling company and then what are some things that people can do to protect themselves from the not so great actors out there who are wholesalers?   Mike: The problem with wholesaling and the reason why it can get a bad name Is it is it is advertised and when I say advertised, I mean if you go out on the internet and say how do you become a wholesaler? Should I be a wholesaler? It's billed to people as this no money, no experience and that's how you get started in the industry…   Michael: And no risk…   Mike: Yeah, no risk. You get this, like, this mentality of this person who thinks they're just gonna roll out of bed open up their eyes, and money's gonna pour through the windows of their house if they're a wholesaler and it's not true, obviously. So you asked me what I do that makes me different. Here's what anyone can do to make their business different, but it doesn't it's not, you know, just for wholesaling but you have to run it like a business and a lot of wholesalers are very transactional in their thinking. They only care about the cheque they're getting next they don't care about future checks. They don't care about consistency, or predictability of their of their business and so they treat wholesaling, like this little dirty act they have to do before the real serious business comes along and in the reason why a lot of wholesalers get this bad reputation also is because there's something called daisy chaining in real estate, and most real, most wholesalers I'm doing air quotes if you guys aren't watching.   The reason most wholesalers or a lot of wholesalers have this reputation is they're not really wholesalers as much as they are what's called daisy chains and a daisy chain er is okay I'm a wholesaler I market to sellers I go into a seller's home. I create rapport and trust and in understanding of what's happening. I get a purchase agreement with them and I take that purchase agreement and I market it out to the other real estate investors in my community and some person who sees this takes the pictures, they take the text, and they mark up the price and then they send it out to a bunch of people, a lot of times a lot of the same people at a higher price and it's like called them and so you call them and you say, hey, I'll take it because you didn't see my marketing, you saw their marketing for whatever reason, you say, I'll take it. They don't even know me and I don't know them. But they're representing that they have this this deal under contract and meanwhile, I'm working with my buyers and I come to an agreement with a buyer and then this person calls me who's was also marketing up my contract and says, hey, I want to buy that house and I go, I've already sold it. Well, he's already told his buyer that they can have it for that price. But I already sold it because I have it under contract. Now he has to go back to the buyer and say, sorry, we have to back out of this deal, right and so it looks like a wholesaler is a really bad business person, bad guy, dishonest, whatever, misrepresenting himself, but he never had the deal and so that happens that's runs rampant. That's a real epidemic in the wholesaling world. So you also asked me, How do you tell the difference or how do you how do you avoid the bad ones?   The first question is that because I get people who send me deals, and frankly, I'll look at them if some other wholesaler finds a deal, and they were they offer it out at a price that my company might be able to land contract that house and we want to buy it, we'll do it. So the first question I asked them is, do you have this under contract yourself or are you representing somebody else and a lot of times they do and sometimes they don't? Sometimes they say they do and I say good. Then before I would buy this, I would need to see the agreement between you and the seller, your company in the seller, what's the name of your company, and I verify this stuff because if they don't have it under contract, I don't even care if they say, yeah, it's not me. But the guy who has under contracts a good friend of mine, and he gave me exclusive rights. I want to talk to who has entered a contract always deal with the person who has an order contract with the seller, with the seller, right? All right, that's, that's key. That's huge and we don't, we don't allow daisy chaining, we don't ever allow people to market out our deals, we only market them out and so all of our buyers know, we've told them several times, if someone if we're marketing a house and you see the same house being marketed by someone else, believe me when I tell you, they're not authorized to do that, they will never be able to sell it to you. So and as a wholesaler, I always make sure that I'm dealing with the end buyer, not a middle person, right? So if someone comes to us, though, and says, hey, I've got a buyer, and they're gonna, they'll pay you this much money and it makes sense for us. We'll give them a check like, well, we'll compensate them for bringing that buyer. But we're not going to we're not going to be what's going to be all transparent, we're going to let everyone know what's happening and so transparency in the wholesale process is important between us as the wholesalers and the buyers total transparency. Now, I'll say something that your audience may not love. There is not total transparency between us and the seller and does that mean that we're lying to them? No, it's not it doesn't. But here's what I always tell people to illustrate my point. Nobody loves or trusts me more than my mother, nobody.   My mom has heard me explain what I do as a wholesaler 1000 times and she has been all ears like she's could not be more dialed in to hurts her baby boy and what he does, and she's so proud and so happy and she's listening intently. But if you call my mom and put her on the air right now and said, Could you please explain to me what your son does? How he does it? She wouldn't know she might even tell you. I'm a realtor. She just doesn't know. It doesn't make sense to her. It's just it's too obscure. Right? So when we're in a seller's home, we don't say to them, Mr. Mrs. Seller, I know you're under a lot of duress. You have to move maybe there was a death or divorce or whatever there was right? Something happened in your life is spiraling. Here's the deal. I want to sign a contract, saying that I'm gonna buy your house, but I'm not buying it. I don't even know who's gonna buy it. I don't know where the money is coming from. I don't know who's gonna show up at closing. I'm not even sure if I'm gonna be able to close. Can we sign the deal now? It nobody would say yes. Okay and that's an a character characterization of what a wholesaler does. But on some level, it's facetious, but it's sort of true, right? I'm signing a contract. I don't exactly know who's going to buy it. In my case as a wholesaler and what I think makes what I do ethical is I have the financial backing to buy any house that I put under contract. If worst comes to worst, I can buy it right and that's not that doesn't come in the beginning. new investors don't always have that luxury. But what you can do as an investor and where you can be transparent and you should be transparent is do not sign a contract and imply or explicitly state that you will for sure be closing on the house without exception, you can't say that in most cases.   So what I say is some version of this, Mister seller, when I came here I was prepared to offer you $100,000 for your house, that was the highest number that I was authorized to offer you, you cannot go below 110,000 That is your lowest, that's the number. That's the gap, right… You want 110 minimum, and I was maximum allowed to offer you 100 but here's what I would like to suggest. Let's sign the contract for 110. Okay, I'm gonna go back to my investors and people who make decisions and help me buy these houses and I am going to see if there is interest at that price, I anticipate that there is not going to be but there very well could be but at the very least, if you can give me two weeks to talk to my investors and go to bat for you, and try to make them understand now that I'm here, I see this house is very nice. I didn't know is this nice but it is a very nice house. I think I can get this done but give me two weeks and I will come back to you in two weeks or less by the way and I'll tell you one of two things either, we can't pay 110 and so we need to rip this contract up and just part as friends, because we all knew that that was a possibility or we're going to move forward at this price and everything is good and I guarantee you will close. Okay, can if you couldn't give me two weeks. Now, if you don't want to do that, I totally get it. If you go to a realtor, they're going to want you to sign it like a three month contract where they get three months to market your house. I just want two weeks and if it takes me two days, I'll come back in two days. Either way, I'll be totally honest with you and it will be up to you what we do from that point we rip up the contract or not. It's totally up to you. Is that? Is that something that you can live with just for a week or two and nine times out of 10? They say yes. Now, when I when I go out now I am going out to my buyers and I'm saying hey, I got this this opportunity who's interested, right? If I get crickets and it's like, nope, nope, nope.   Then usually we'll try to figure out what our buyers would pay, right? That's the next question. Okay, you don't want it? It's fine. But what would you pay for this and we start getting that feedback and so we can go back to the seller and say, listen, I was right. 100,000 is the best we can do but I'm totally willing to rip up this contract because you want 110 or we can talk about a reduction or, or the or we get buyers that are like, yeah, I'll do it for that price. That's great, right and it's a little better than we thought and we go back and tell the seller, hey, if we go out to our buyers, and we find out that 110 is a really good price for us still, we'll still make the money we thought we were going to make we always go back and say we'll honor the 110 because I think that's the question I would be thinking in my mind if I'm listening to this interview? Well, what happens if they get really great offers? Do they still always go back and try to get that lower number? No, we don't. If we can make what we thought we would make or pretty close to it, we'll pay a higher price, right? We're, my goal here is to get to heaven not to make an extra $5,000, right. So I'm not trying to be a bad guy. But the key is the ethical wholesalers versus not the ethical ones, prepare the seller for the potential for a renegotiate or a cancellation up front and so when we go back, how often are they irate because we come back and say, hey, we can't do the 110. Almost never, because we very thoroughly explain what we're doing and we prepare them that we may have to come back and discuss the reduction or cancellation. The people honestly, they just want clarity.   They just want to know what's going to happen. What people get mad about are surprises. So when you say oh, great 110 done deal. I can't wait to close with you in a few weeks. This is so exciting and then you come back in three days and say we have to cancel the contract. They're mad 100% of the time, because they weren't you're not clear on what was happening. You surprise them with bad news and nobody likes being surprised with bad news but when you come back and say, hey, remember when we talked a week ago and I said this? Well, we can't do the 110. You know, we tried nine times out of 10 they're totally fine and honestly, seven times out of 10. They say well, what can you do and then we have that discussion. So, man, it's all about setting expectations.   Michael: Yes, 1000 times yes, as funny as you were going through kind of your pitch. I was like, Oh yeah, like that makes sense. That's such a different, like feeling that I got as you were giving as you were giving that Spiel than what I was expecting or than what I've experienced with wholesaler. So I mean, kudos to you and your team. It's clearly it's clearly working for you, so keep up keep up the great work.   Mike: Well, honestly, we have gotten deals, where and I know that sounds cliche, but I swear to you, this happens all the time and it we only know that when people tell us right so my guess is it happens more than we even know but we get deals where they got a higher offer from another wholesaler. But because we come in and we are professional, and we do address their concerns, but we wholesaling is not really about buying houses. It's about solving problems and again, sounds cliche, totally true. You can figure out what their pain point is and you can focus on that the sale of the house is secondary and I know that because we've had sellers tell us listen, we had somebody come along and offer us more than you guys, but we're not going to sell to them, we're going to sell to you because we believe you, we believe what you're saying and we like working with you. So professionalism matters and just to illustrate that point, underline it real quickly, one of our reps went into a house one time, and he was talking to a seller and they were going through the whole thing, it was like halfway through the meeting, and then knock on the door, and the seller says, oh, I forgot.   There's another investor or another, whatever. They call them coming in another person who wants to look at my house and my rep was like, oh, okay, and he kind of stood aside and a guy came in, my rep looked outside, and he saw the guy was driving a Mercedes, nothing wrong with that Mercedes fine but he left it running. He was wearing a suit, he came into the house, briefly said hello, and started walking around, pointing out all the flaws in the house, this is all this has to be replaced. That's no good. Nobody wants that and he shot a number at her with what he would pay and said, think about it and he got in his car and left. Like, everything that guy said, that wasn't verbal screamed, you are not that important to me. I'm way too big of a deal for you and I don't even have time to turn my car off. That's how little I think about what is your situation. I'm just telling you what I need and what I want and what I'll give you and I'm out of here, right and understandably, the seller was floored. She's like, that was the rudest thing I've ever seen, like, that was awful. I feel so like, offended by that. Yeah and of course, my rep was like, yeah, I would be offended too, right. Like, I agree with you. They're horrible. We're great. Let's get back to talking about how great we are. So it matters, like paying attention to their pain points, and not being all about the number. If you start talking about price right off the bat, you can almost guarantee you're not gonna buy the house. Yeah, if you start by listening, and addressing their problems, and let the sale be last. It'll work out for you much, much better.   Michael: I love it, I love it, I love it. Mike, we could go on, I think probably for days talking about this stuff but I want to be very respectful of your time and get you out here. For anyone that wants to learn more about you, your processes your business, where's the best place for them to do that?   Mike: Yeah, thank you for that by the way, I appreciate it. The best place to get a hold of me would be at my on my website, https://www.mikesimmons.com/ . If you go on mikesimmons.com, you can find anything about me and also my podcasts. I have a podcast called just out real estate. You can find the link to that on my on my website as well.   Michael: Right on…   Mike: Which you were on right, you were my guest.   Michael: We had a lot of fun.   Mike: Yeah, we did.   Michael: Well, Mike, thank you again for coming on and sharing so much wisdom with our listeners really appreciate it and I'm sure we'll chat soon, man. I look forward to it.   Mike: Absolutely. Thank you for having me. It was a pleasure.   Michael: Likewise, talk soon.   All right, everyone. That was our show a big thank you to Mike for coming on. Super, super insightful stuff. I learned a ton about the wholesaling business and wholesalers in general, and some really great questions that we as investors can be asking wholesalers to protect ourselves from the downside. So as always, if you liked the episode, feel free to leave us a rating or review wherever it is you get your episodes, and we look forward to seeing the next one. Happy investing…

The Remote Real Estate Investor
Are current market conditions an opportunity for real estate investors?

The Remote Real Estate Investor

Play Episode Listen Later Jun 30, 2022 21:37


Dana Dunford is the CEO of Hemlane Property Management and a real estate investor. In today's episode we discuss market conditions, interest rates, what is happening in the stock market, and what the current moment means for real estate investors. If you are wondering if it is the right time to purchase an investment property, you will want to listen to this episode. Links: Hemlane.com --- Transcript Before we jump into the episode, here's a quick disclaimer about our content. The remote real estate investor podcast is for informational purposes only and is not intended as investment advice. The views, opinions and strategies of both the hosts and the guests are their own and should not be considered as guidance from Roofstock. Make sure to always run your own numbers, make your own independent decisions and seek investment advice from licensed professionals.   Michael: Hey, everyone, welcome to another episode of The Remote Real Estate Investor. I'm Michael Albaum, and today I'm joined by Dana Dunford, co founder and CEO of Hemlane Property Management. And today Dana is gonna be talking to us about the state of the economy and some things that investors should be aware of and thinking about as we move forward in today's market. So let's get into it.   Dana Dunford, welcome back again to The Remote Real Estate Investor. Thanks for coming on and hanging out with me.   Dana: Great. Thanks for having me. Again, Michael.   Michael: Oh, my gosh, it is such a pleasure. You are great friend of the pod. Great friend of Roofstock. For those who might not be familiar with you give us the Quick, quick and dirty background of who you are. And background on yourself.   Dana: Yeah, so I'm Dana Dunford. I'm here in San Francisco. So just right across the bridge from rootstock. I have been in technology for gosh, now we're going on 18 years. So I'm a tech veteran, which we'll be talking about tonight, today, which I'm excited about. And on top of that, I'm in property management. So we're a tech platform for property management, and partner of Roofstock's. And we've seen what has been going on since q1, the market softening things changing in technology. So I think this is going to be a great call, because both Roofstock and Hemlane have seen it firsthand. And hopefully this gives some insight into what, what the upcoming year is going to look like for all real estate investors out there.   Michael: Totally. And just to give some people, some additional color, you are CEO, co founder of Hemlane, and you just did your series A, what was it q3 of 2021 or q4 of 2021?   Dana: Q4, so we raised at the perfect timing, those who are not in venture and the tech world of Silicon Valley. We couldn't have timed it better. You know, right now, and we'll talk about this today. Right now, the market is really softening. There's just less capital going into startups. We can't say this was people were already predicting this. So back in q3, and q4 venture capitalists were already saying, Ooh, there's a lot of money pouring into this valuations are really high. And some had already started pulling back. But it wasn't until what happened in the public markets, where you know, trillions of dollars were taken out of these Sass companies, valuations are overall the market cap, that suddenly the venture world that trickled down and people really started to pull back capital. So yeah, we raised back then roofstock, when was your guys's last raise? Because you guys are at a later stage. And so obviously, also impacted by this and quite, potentially, more significantly than us.   Michael: I think we got our term sheet squared away in in q4, as well. So right around that same perfect timing with money getting wired in coming in and in q1.   Dana: Yeah, perfect. So you guys will be able to weather the storm with that what we're going to be talking about soon here.   Michael: Yep, absolutely. I'm thinking so. Okay, so let's talk about how, like, how did we get here, because you're mentioning that trillions of dollars have been essentially taken off the table in terms of market cap. But for those people that aren't familiar with the space that haven't maybe been following along as closely, what like, where are we today? And can you give us some insight and background as to how you think we got here?   Dana: Yeah, so first of all, I believe most people on this podcast today listening are real estate investors. And so all of you hopefully got in when interest rates were super low, just artificially low, right? We never seen interest rates below 3% for so long. And one that was fantastic for real estate, right? You could get a rental properties at afford a higher price because your interest rate is much lower your loan. And then for startups and for companies money was much more free it was much more flowing. What we ended up seeing happen which most people predicted this would happen. But no one knew when or at least I haven't heard of any economists who knew this was going to happen exactly. We're in March, but we started seeing the inflation go through the roof, you know, 8.6%. And it's been consistent where we have seen the inflation rate really, really high.   And so the only way for the Fed to essentially combat that was obviously, to increase interest rates, which we are all seeing now are all seen in our real estate itself, doesn't mean there aren't great deals out there. So Mike, like, do you want us to talk about that, because I still think there's great deals out there that you guys have on the platform, and now could be a really good time to buy. So don't let that taint your decision of whether or not you should go into real estate.   But with that, as you know, when the Fed raises interest rates, consumer spending just goes down, that will probably people will spend less, and also things are more expensive. And so once you have that happen, the stock market's inversely correlated to interest rates. And so once interest rates went up, there was a correction in the stock market. Why it affects us on the private company side so much is Roofstock and Hemlane are both considered growth companies. And what happened was essentially, in the public markets, so any public company, there's basically two different types, there's growth, just like us, companies like Roofstock, that have gone public. And then there are value companies and the value companies are much more stable. They're based on their cash flow. They're typically larger, older companies, and their price is based on their sales. So their price is relatively low relative to sales, in companies like that, or like Bank of America, if you think about it, and RG like gas companies like very stable, steady businesses, where you're not going to see   Michael: Blue chip companies.   Dana: Yeah, your blue chip companies where you're not going to see, you know, 500% growth year over year. But what ends up happening is when the interest rates go up like that, and stocks go down, the ones that get devalued, the most are the growth stage companies. And the growth stage companies are companies like Roofstock, and heavily that are public. And so what we basically saw happen was this huge, huge cut in market cap in the public markets. And so for SAS company software as a service where you go, you pay a subscription every month to use a service, the market cap cap got cut by $1 trillion dollars from November of 2021. Until today, and so what that did was essentially, these companies thought they were worth a lot more.   And you know, some of them, like the stripes of the world, in the snowflakes had these really high revenue multiples, and suddenly, those just deteriorated. And the multiple based of what their valuation is versus their, their revenue went down. And that essentially trickled down to private companies like us as well. And so now when a company goes out to raise capital in q1, q2, primarily, now it's even, it's even worse. And what we're foreseeing in q3 is that you might have had a 10x, revenue multiple, so your valuation, it's 10x, what your revenue is, that's how it used to be.   Now you go out to a venture capitalist, and they're like, great, you're worth 3x, or 5x. So much lower valuation. And so what they're, they're expecting is a lot of down rounds, a lot of startup saying, If I can, let me just hold on to my cash, let me cut my bird, let me try to raise later and better times. And all of this impacts the economy, because it was the public markets that were hit. And now it's also the private companies where we are in Silicon Valley. And I do think this, this trickles a bit to real estate. It's it's a different type of market correction that we saw in 2008. In 2008, it was housing right and the mortgage crisis today, I think this is a lot more like the.com bubble. This is very similar to the.com bubble of these really high tech valuations that need to be corrected. And so when you think about purchasing real estate, I actually think that's why Roofstock is such a fantastic place to go. Because you're getting out of the tech scene, you're going to other markets and purchasing there.   Michael: It's so interesting. But then so I'm curious, we talk so often about in real estate that the price is only a factor, or it's only important if you're doing something with the property if you're buying selling refinancing, because otherwise you're just having a cash flow, and that often is independent of what the value is of the company, or excuse me, the property. So why does that matter? or for companies like the fact that there's the company is now worth less, unless they're trying to do something buy, sell, or refinance or raise, raise, raise capital, like, why does that matter?   Dana: So it doesn't matter for Roofstock. And it doesn't matter for Hemlane, because we just raised, we have enough capital to weather this storm. But imagine a company that raised and they had a, let's just give the case of like the stripes of the world 100x Multiple. And let's just say it's a private company, with 100x, multiple, and now they're going back out, and they're now getting a 10x. Multiple, they could have what we call a down round, where suddenly they are worth less than they were before. And that gives a lot less confidence. One the company itself, right? The amount that you're giving up as a founder, as an employee, as an existing investor, it's a lot more just to get in the same amount of capital you wanted to historically, in so what you're seeing is these companies really, really tighten the ship, and just say, Okay, we're going to stop hiring as many people, we're really going to look at our expenses. And that means there's not more money pouring into, you know, hiring 100 people every week, they're suddenly going back and thinking about who are the strategic hires, we really need? Should we be letting go? You've seen the massive tech layoffs where it's, you know, 20% of the workforce. And now suddenly, they're really tightening their books, because cash is king right? Now, you want to hold on to that cash? Because the last thing you want to do is go out and have a lower valuation.   Michael: Yeah. Okay. Well, that makes sense. And so talk to us a little bit about why this is affecting real estate investors or why real estate investors should even care about this that's going on?   Dana: Yeah. So I always think there's a huge opportunity when there's like the Warren Buffett, quote, right? be fearful when others are greedy and be greedy when others are fearful. I think right now everyone's scared. And there's a lot of real estate investors, like we actually just did a survey at Hemlane, where majority were saying we're not going to purchase in the next 12 months, because interest rates have gone up we should have gotten any year ago. Well, you know, the best time to get into real estate was 10 years ago, and the next best time is today, I think there's going to be a lot of great deals out there. I think that while others are tightening up, other investors are scared, this is a time for you to be really aggressive. I mean, still looking at your pro forma and and follow your numbers. But you'll be able to find some some great deals out there.   Michael: I've heard a lot of sentiment around, you can always change your interest rate, but you can never change your purchase price. So if someone is getting into a deal today, at an interest rate that's a little bit higher than they're comfortable with. But they anticipate interest rates to come down at some point down the road. What are your thoughts there?   Dana: Yeah, you can always refinance. I mean, don't do a deal hoping that interest rates go down, and you can refinance it or fudge the numbers on your spreadsheet. This is why   Michael: I was hoping that's what you were gonna say.   Dana: Yeah, like this is I mean, this is why I'm, I'm more conservative than most in every property purchases had a fixed rate. I don't do adjustable. But I can refinance, right? So I can always refinance. But I want to know what I'm getting into. So when you do your pro forma, do it with whatever the interest rate is now and consider it a huge advantage and just like increased cash flow, if you can refinance in the future, will interest rates go back to this like artificially low rate that we saw over the past five years, maybe not. But I don't think that is a reason not to purchase now. You do your numbers, and you look at it just because you might say property values are really high interest rates are going up, now's not a good time to buy. That's just laziness. Like, honestly, that's just you being lazy and not wanting to do the work.   There's always great deals out there. You just have to do the work, find them look at the numbers and say even with this increased interest rate, it's still a great deal. I'm still cash flowing and I've got a great cap rate, and you can go ahead and purchase. So I don't think of this as the time really to, to change your decisions on real estate. And part of that has to do with I think, you know, some markets will soften. Some markets may remain flat for a while but that doesn't mean that you're not getting the cash flow and having a great investment that by the way, with inflation where it is If it continues, having an asset where the value goes up with inflation, so I still think now's a great time to purchase real estate. And you might be able to get some fantastic deals as other investors are pulling out, you can really, really go in and get those great deals.   Michael; Love it. And Dana, I'm curious if because we've seen prices go through the roof, and interest rates have also gone up significantly, there might be a bit of a lead lag measure until we see prices come down. So in in terms of looking for different markets, I mean, are you targeting markets that are continuing to grow? Are you targeting markets that maybe are seeing some of that softening in terms of pricing?   Dana: So for us, we go where the real estate investors are. So if there's a real estate investor there, right, we're going to do the property management for them. I think when you're when you're thinking about the lag, that is definitely true. I've heard this with other real estate investors, I've seen it myself, where you see a price. And with interest rates up, the seller puts one price out there, because that's what it was two weeks ago. And suddenly, it's not worth that much. It's worth like 10% 20%. Last, but it's actually really good to put yourself into the position of the seller, and of the real estate agent, because you can actually get some really, really good deals off of that.   And what I mean by it is real estate investors have always told historically, have told their buyers in the past couple of years. If your mark, if your property is on market for over two weeks, people might think there's something wrong with that. And so, you know, we're going to ask for offers on X date, right, like X date and two weeks, or maybe we'll do one week, we're going to ask for offers. Well, if they've missed priced the property, you might be able to go in and you don't know this, but you might be the only offer because they priced it way too high, because we priced it from a purchase price from two weeks ago. And now that has suddenly changed like the market changes every two weeks, it really is. And you could go in and get a great deal. And so I think from from that perspective, there are still fantastic deals out there. But you have to be patient. And some of it will be that luck, where you get the right deal, though what else has gone into, and you can go ahead and purchase that.   So if you put yourself in the other shoes, you might see that you also see a lot of people you know why I don't think it's like 2008 and 2009 is people have a lot more equity in their properties because one value values have gone up. And then two, the interest rates were really low, people could afford more put more money in the market was booming. And so what we're seeing is that more people have equity in them. And at some point, it's emotional for someone, they're like, I just want to get rid of this asset, because I'm gonna go buy another one, or I just really want to move out of the city and move somewhere else. And, you know, to them, maybe 20 To 50 to $70,000 is not a lot depending on what it is. But that is a lot to you. And that changes, changes the numbers on your spreadsheet significantly.   And so I mean, with that purchase price, obviously that matters. But just because the price is out on the market for a property doesn't mean that the price is going to sell for. And so it would be a really good time to go out and experiment with that you will know your market better than anyone else, whatever market you're in, because it will take you bidding on like five properties. And maybe people will laugh at you like your first one, you go like 20% under and they laugh at you. But maybe you get lucky on the fifth one, and you'll get a great deal. But yeah, just follow the numbers in your spreadsheet don't have a purchase price, that doesn't make sense and you're not cash flowing. Or don't change the interest rate hoping that it will go down to that to that amount.   Michael: Yeah, that makes total sense. And speaking of spreadsheet numbers, are you seeing a lot of your investor clients that you work with adjusting their expectations around cash on cash returns? Now that prices and interest rates are up?   Dana: So not really I think most investors like most of the savvy ones we work with, we work with his sort of two different types of of customers, those who had properties just handed to them. And they actually never did the analysis like pan downs from parents and things like that. And then others   Michael: Accidental landlords.   Dana: Accidental Yes. And then others who are very strategic real estate investors and what we have found with them as they have the capital and they might not be they might be with inflation to your point Michael being like, Oh, maybe I should just go buy something because the dollar today is worth less On tomorrow, but no, I actually think most real estate investors are still saying, this is the deal that I got, historically, I want to get something like that. And so they're not changing those expectations on cash on cash return, but they might be going somewhere else. So they go to Roofstock, and they say, Okay, I, you know, couldn't find this property, you know, in my backyard, but on Roofstock, they do have the cash on cash return that I that I that I targeting. And so I do think they're not changing their expectations. But they are going out and finding alternative ways to get the numbers they need.   There's one case, Michael, where I find people change their expectations. And it's first time real estate investors to just get their foot in the door. And I'm actually okay with that. I think that there's too many people who, and for anyone who's listening to this, who doesn't have a real estate investment, you kind of sit there and you kind of fantasize about getting one and then you put so much like anxiety into getting your first property. And once you have your first you're like, oh, okay, that's what I got, here's what it is. And it makes it easier, where then you can go and purchase more properties and more properties. And you know, what you're looking for, and you know what the return was, and you have this process set up.   But the first one is really difficult to get into. So I find that those people today are changing their expectations, for certain metrics just to get into the market, before it's too late. Interest rates go up more, or you know, they're kind of kicking themselves that they didn't get in, you know, four years ago, five years ago. So I only think it's first time real estate investors where that's happening. And I'm actually okay with that. Because I think if you can get more people into real estate investing, and more people to just get their foot in the door, you're going to learn so much off of that first property, that then you're going to say, Okay, this was my cap rate for my first property. My next one, I have to at least have that or better and you kind of improve, you know, it's kind of like dating, you never like you don't date someone who's great. And then like the next person is like a downgrade, you kind of have the standard. And you're like, I can only go up from there. It's the same exact thing with real estate investing. So I really think it's only first time homebuyers where that happens are real estate investors for rental properties?   Michael: Yep, I think and I think that makes tons of sense. It's something that I hear all the time. It's Michael, I'm trying to get my first deal done and has to be amazing. And you know, it has to be a Grand Slam? Like? Don't worry about the grand slams, let's practice getting on base first. And then you'll know how to swing for   Dana: Exactly, exactly. And it makes it a lot easier when you have one property in that area. You know your market a bit more, and then you can kind of purchase some more around at.   Michael: Yep. Yeah, I think it makes him think that's totally right. And so Dana, we're kind of at this like crossroads where we're talking about, some investors are pressing pause on their acquisitions. And then this whole other cohort of investors are like, Oh, crap, I gotta get into the market before interest rates go up further before prices go up further. So it does feel like there's this pressure to buy or there's frenzy to buy, on the one hand, and then there's this whole other group, that's again, kind of taking a step back and saying, let's, let's wait and see what happens. How do you square those two?   Dana: Well, to me, I'm like a pretty unemotional real estate investor. And I feel like for anyone, whatever segment you fall into, you still have to go back to the numbers and see what makes sense. And so I mean, is there a right way to go? I think one people who are not going out, and they're using this as an excuse not to purchase properties, or just being lazy, honestly. And for those who are out there saying, I gotta get in and get my next deal. I think they're almost too emotional. Where they might go in and change the numbers to your point of saying, like, oh, it's not, you know, my last deal was was better than this, but I just need to get my foot in the door. Maybe that's not the right approach to have, it's, Hey, there's gonna be a deal out there. I might have to be a little bit more patient during this the for the next three to six months, I have to be patient, I have to understand what's going on.   But yeah, I just kind of go back to the numbers. I think in both cases, they're they're taking emotion and what's happening in the market and using that, like the macro for the micro. And instead of saying, You know what, I know what is a good deal, here's what it looks like on paper. Let me continue to go search until I find that and it might take you a little bit longer to find it. Or you might find a process like oh, wow, I can, you know, go 20% under and get lucky on a deal off of this, whatever the home price is, I could, you know, undercut them and give them an offer and maybe they'll take it to get that great deal.   Um, But I don't I think both categories are bad. I think someone who says I have to get my foot in the door. Before interest rates go up is emotional. I think someone who says there are no great deals out there are just lazy. And so I kind of fall somewhere in between of saying, yeah, just be financially prudent as you always should be with your real estate investment investments, know your market, know what numbers numbers you need, and make sure you're a little bit more conservative. Like, I know, a couple investors with adjustable rate mortgages that did them, you know, back when interest rates were really low. And I bet they feel pretty stupid right now. So   Michael: we won't name names,   Dana: Won't name names here.   Michael: Well, I'd be very interested to meet the the emotionally lazy person, because it sounds like those are two opposite ends of the spectrum. Yeah, I have to see. Okay. And last thing that I want to ask you about is around expectations. If someone is newer to the investment space, they may be looking to get their first deal done. Everyone around them, their sister, their brother, aunts, uncles in this market are making 10% cash on cash. Yeah, pick a number. Nice round number 10%. And they're like their expectation was was 15%. Right, for whatever reason, that's what makes them tick. That's what gets them excited about an investment. Everyone around them is making 10%. So how the how should investors be thinking about not looking at other people, and just focusing on what's good for them, but also not being blind and naive to what a market is really able to produce? In terms of In other words, like, they I want someone to be excited about the returns that they're getting, but I also want them to be realistic. How do you kind of how do you?   Dana: So the biggest thing I would say to throttle that is, most likely you've sort of selected a market because you've looked at, okay, where is and I mean, Roofstock does this for you, and you guys, I think have some great shows from like every single market of why why you guys are looking at a certain market. So that helps. But you as a real estate investor are gonna say worse population growth? And why like, is more industry going there? Like maybe an Amazon facility was just put into place? Does it have fed, ed's and meds? Like, is it stable, even recession proof, especially now? So you kind of go through and figure out why am I excited about this market? And you just start there? And like, don't forget about your, I mean, 15% cash on cash return? Like, let's just forget about all of that and just go through? What looking at macro, and now we're kind of going to micro to like city level?   Why do I think this is going to be a lot a good market in five to 10 years, because you're going to hold on to these properties and purchase more, right? Do that first, then you say, Okay, this is my market, then what you're going to do is for two to three months, you're going to look at all the deals there, go on Roofstock, I think you could set up alerts because I have those that go to my email that essentially like tell you here's a new property in that market, great purchase. Um, you're gonna go through and you might the first couple of properties, say you know what? Those, those don't really hit my cash on cash return expectations, but now you're starting to know your market and you're gonna see a trend, are they going up? Are they going down? And you can look at that over time to make an unemotional decision that is based on data.   I think that is the most important thing to do. When someone gets in this frenzy of I need this cash on cash return shoot, I'm not going to get it. So I'm just going to slash it. And I'm going to say now I need, you know, seven or 8% I and you're just becoming emotional. But if you go through look at the numbers and you say okay, great, I wanted 15% You know, my friends are getting 10% I'm and you're you change those expectations. And suddenly you say, Okay, I made this decision, and here's my cash on cash return. But I knew at that time, that was the best I could do. Because I looked at the data, then suddenly you never go back and wish you had done it differently. Because you have something that is non non emotional to back you up. And don't compare yourself to other real estate investors. I've seen real estate investors in the past four to five years who've been super successful, who are super stupid.   And the reason they were successful and I hate to say that but like there's so many people out there because basically it was free money like there was so much investment it was there was so much easy money from investors that I saw way too many people also going into real estate. A lot of actually on the fix and flip side that just got lucky because yeah, money was basically free to do a fix and flip and a The home prices were going up astronomically. And they feel like they're the smartest people in the room.   Well, maybe they were at that time, but like, give it two to three months, maybe six months, and the story might change. And so that's why I think it's hard at like one point in time, if you're just getting started to compare yourself to those around you, I don't think you should do that. I think you should just be financially prudent, and make sure that you're not overextending yourself. And you know, your market. And you know why you made the decision, you see you did, and it's all based off those numbers. And it's based off the numbers, but also you need to know the market, like you need to know you guys have neighborhood scores and ratings, that kind of stuff of like, here's why I only invest in neighborhoods that have three stars, or greater, or whatever it may be like it, write all of this stuff out, and take a really methodical approach to your assets, your real estate investing, and I don't think you'll regret it. Like, I don't think you're gonna go back and say, Oh, I really wish I would have gotten that 15% I targeted?   Michael; I think that is like spot on. Thank you so much. And if you missed it, if you missed any part of that, go back, rewind the last three minutes, and listen to that again, cuz I think that's a lot of gold in there. Then this was super fun. As always, if people want to reach out more, find out more about you or hemline. Where's the best place for them to do that?   Dana: Yeah, you can go on to Roofstock when you purchase a property, how many will be listed as a property manager? So go go ahead and do that. You can also go to Hemlane.com. And my email is dana@hemlane.com. So I love hearing from people.   Michael: Awesome. Well, thank you again, and very much looking forward to having you on. Again, I'm sure take care of we'll chat soon.   Dana: Great. Yeah, I'm excited in six months for us to see if we were if we stand corrected on what's going on in the market.   Michael: I know it'd be very interesting. Well keep close tabs on it.   Dana: Great. Thanks so much for having me.   Michael: You got it, take care.   Okay, everyone, and that was our episode A big thank you to Dana for coming on as always big friend of the pod as we were saying at the beginning of the show. As always, if you liked the episode, we'd love to hear from you all with a rating and review and we look forward to seeing the next one. Happy investing

The Remote Real Estate Investor
Are current market conditions an opportunity for real estate investors?

The Remote Real Estate Investor

Play Episode Listen Later Jun 30, 2022 32:25


Dana Dunford is the CEO of Hemlane Property Management and a real estate investor. In today's episode we discuss market conditions, interest rates, what is happening in the stock market, and what the current moment means for real estate investors. If you are wondering if it is the right time to purchase an investment property, you will want to listen to this episode. Links: Hemlane.com --- Transcript Before we jump into the episode, here's a quick disclaimer about our content. The remote real estate investor podcast is for informational purposes only and is not intended as investment advice. The views, opinions and strategies of both the hosts and the guests are their own and should not be considered as guidance from Roofstock. Make sure to always run your own numbers, make your own independent decisions and seek investment advice from licensed professionals.   Michael: Hey, everyone, welcome to another episode of The Remote Real Estate Investor. I'm Michael Albaum, and today I'm joined by Dana Dunford, co founder and CEO of Hemlane Property Management. And today Dana is gonna be talking to us about the state of the economy and some things that investors should be aware of and thinking about as we move forward in today's market. So let's get into it.   Dana Dunford, welcome back again to The Remote Real Estate Investor. Thanks for coming on and hanging out with me.   Dana: Great. Thanks for having me. Again, Michael.   Michael: Oh, my gosh, it is such a pleasure. You are great friend of the pod. Great friend of Roofstock. For those who might not be familiar with you give us the Quick, quick and dirty background of who you are. And background on yourself.   Dana: Yeah, so I'm Dana Dunford. I'm here in San Francisco. So just right across the bridge from rootstock. I have been in technology for gosh, now we're going on 18 years. So I'm a tech veteran, which we'll be talking about tonight, today, which I'm excited about. And on top of that, I'm in property management. So we're a tech platform for property management, and partner of Roofstock's. And we've seen what has been going on since q1, the market softening things changing in technology. So I think this is going to be a great call, because both Roofstock and Hemlane have seen it firsthand. And hopefully this gives some insight into what, what the upcoming year is going to look like for all real estate investors out there.   Michael: Totally. And just to give some people, some additional color, you are CEO, co founder of Hemlane, and you just did your series A, what was it q3 of 2021 or q4 of 2021?   Dana: Q4, so we raised at the perfect timing, those who are not in venture and the tech world of Silicon Valley. We couldn't have timed it better. You know, right now, and we'll talk about this today. Right now, the market is really softening. There's just less capital going into startups. We can't say this was people were already predicting this. So back in q3, and q4 venture capitalists were already saying, Ooh, there's a lot of money pouring into this valuations are really high. And some had already started pulling back. But it wasn't until what happened in the public markets, where you know, trillions of dollars were taken out of these Sass companies, valuations are overall the market cap, that suddenly the venture world that trickled down and people really started to pull back capital. So yeah, we raised back then roofstock, when was your guys's last raise? Because you guys are at a later stage. And so obviously, also impacted by this and quite, potentially, more significantly than us.   Michael: I think we got our term sheet squared away in in q4, as well. So right around that same perfect timing with money getting wired in coming in and in q1.   Dana: Yeah, perfect. So you guys will be able to weather the storm with that what we're going to be talking about soon here.   Michael: Yep, absolutely. I'm thinking so. Okay, so let's talk about how, like, how did we get here, because you're mentioning that trillions of dollars have been essentially taken off the table in terms of market cap. But for those people that aren't familiar with the space that haven't maybe been following along as closely, what like, where are we today? And can you give us some insight and background as to how you think we got here?   Dana: Yeah, so first of all, I believe most people on this podcast today listening are real estate investors. And so all of you hopefully got in when interest rates were super low, just artificially low, right? We never seen interest rates below 3% for so long. And one that was fantastic for real estate, right? You could get a rental properties at afford a higher price because your interest rate is much lower your loan. And then for startups and for companies money was much more free it was much more flowing. What we ended up seeing happen which most people predicted this would happen. But no one knew when or at least I haven't heard of any economists who knew this was going to happen exactly. We're in March, but we started seeing the inflation go through the roof, you know, 8.6%. And it's been consistent where we have seen the inflation rate really, really high.   And so the only way for the Fed to essentially combat that was obviously, to increase interest rates, which we are all seeing now are all seen in our real estate itself, doesn't mean there aren't great deals out there. So Mike, like, do you want us to talk about that, because I still think there's great deals out there that you guys have on the platform, and now could be a really good time to buy. So don't let that taint your decision of whether or not you should go into real estate.   But with that, as you know, when the Fed raises interest rates, consumer spending just goes down, that will probably people will spend less, and also things are more expensive. And so once you have that happen, the stock market's inversely correlated to interest rates. And so once interest rates went up, there was a correction in the stock market. Why it affects us on the private company side so much is Roofstock and Hemlane are both considered growth companies. And what happened was essentially, in the public markets, so any public company, there's basically two different types, there's growth, just like us, companies like Roofstock, that have gone public. And then there are value companies and the value companies are much more stable. They're based on their cash flow. They're typically larger, older companies, and their price is based on their sales. So their price is relatively low relative to sales, in companies like that, or like Bank of America, if you think about it, and RG like gas companies like very stable, steady businesses, where you're not going to see   Michael: Blue chip companies.   Dana: Yeah, your blue chip companies where you're not going to see, you know, 500% growth year over year. But what ends up happening is when the interest rates go up like that, and stocks go down, the ones that get devalued, the most are the growth stage companies. And the growth stage companies are companies like Roofstock, and heavily that are public. And so what we basically saw happen was this huge, huge cut in market cap in the public markets. And so for SAS company software as a service where you go, you pay a subscription every month to use a service, the market cap cap got cut by $1 trillion dollars from November of 2021. Until today, and so what that did was essentially, these companies thought they were worth a lot more.   And you know, some of them, like the stripes of the world, in the snowflakes had these really high revenue multiples, and suddenly, those just deteriorated. And the multiple based of what their valuation is versus their, their revenue went down. And that essentially trickled down to private companies like us as well. And so now when a company goes out to raise capital in q1, q2, primarily, now it's even, it's even worse. And what we're foreseeing in q3 is that you might have had a 10x, revenue multiple, so your valuation, it's 10x, what your revenue is, that's how it used to be.   Now you go out to a venture capitalist, and they're like, great, you're worth 3x, or 5x. So much lower valuation. And so what they're, they're expecting is a lot of down rounds, a lot of startup saying, If I can, let me just hold on to my cash, let me cut my bird, let me try to raise later and better times. And all of this impacts the economy, because it was the public markets that were hit. And now it's also the private companies where we are in Silicon Valley. And I do think this, this trickles a bit to real estate. It's it's a different type of market correction that we saw in 2008. In 2008, it was housing right and the mortgage crisis today, I think this is a lot more like the.com bubble. This is very similar to the.com bubble of these really high tech valuations that need to be corrected. And so when you think about purchasing real estate, I actually think that's why Roofstock is such a fantastic place to go. Because you're getting out of the tech scene, you're going to other markets and purchasing there.   Michael: It's so interesting. But then so I'm curious, we talk so often about in real estate that the price is only a factor, or it's only important if you're doing something with the property if you're buying selling refinancing, because otherwise you're just having a cash flow, and that often is independent of what the value is of the company, or excuse me, the property. So why does that matter? or for companies like the fact that there's the company is now worth less, unless they're trying to do something buy, sell, or refinance or raise, raise, raise capital, like, why does that matter?   Dana: So it doesn't matter for Roofstock. And it doesn't matter for Hemlane, because we just raised, we have enough capital to weather this storm. But imagine a company that raised and they had a, let's just give the case of like the stripes of the world 100x Multiple. And let's just say it's a private company, with 100x, multiple, and now they're going back out, and they're now getting a 10x. Multiple, they could have what we call a down round, where suddenly they are worth less than they were before. And that gives a lot less confidence. One the company itself, right? The amount that you're giving up as a founder, as an employee, as an existing investor, it's a lot more just to get in the same amount of capital you wanted to historically, in so what you're seeing is these companies really, really tighten the ship, and just say, Okay, we're going to stop hiring as many people, we're really going to look at our expenses. And that means there's not more money pouring into, you know, hiring 100 people every week, they're suddenly going back and thinking about who are the strategic hires, we really need? Should we be letting go? You've seen the massive tech layoffs where it's, you know, 20% of the workforce. And now suddenly, they're really tightening their books, because cash is king right? Now, you want to hold on to that cash? Because the last thing you want to do is go out and have a lower valuation.   Michael: Yeah. Okay. Well, that makes sense. And so talk to us a little bit about why this is affecting real estate investors or why real estate investors should even care about this that's going on?   Dana: Yeah. So I always think there's a huge opportunity when there's like the Warren Buffett, quote, right? be fearful when others are greedy and be greedy when others are fearful. I think right now everyone's scared. And there's a lot of real estate investors, like we actually just did a survey at Hemlane, where majority were saying we're not going to purchase in the next 12 months, because interest rates have gone up we should have gotten any year ago. Well, you know, the best time to get into real estate was 10 years ago, and the next best time is today, I think there's going to be a lot of great deals out there. I think that while others are tightening up, other investors are scared, this is a time for you to be really aggressive. I mean, still looking at your pro forma and and follow your numbers. But you'll be able to find some some great deals out there.   Michael: I've heard a lot of sentiment around, you can always change your interest rate, but you can never change your purchase price. So if someone is getting into a deal today, at an interest rate that's a little bit higher than they're comfortable with. But they anticipate interest rates to come down at some point down the road. What are your thoughts there?   Dana: Yeah, you can always refinance. I mean, don't do a deal hoping that interest rates go down, and you can refinance it or fudge the numbers on your spreadsheet. This is why   Michael: I was hoping that's what you were gonna say.   Dana: Yeah, like this is I mean, this is why I'm, I'm more conservative than most in every property purchases had a fixed rate. I don't do adjustable. But I can refinance, right? So I can always refinance. But I want to know what I'm getting into. So when you do your pro forma, do it with whatever the interest rate is now and consider it a huge advantage and just like increased cash flow, if you can refinance in the future, will interest rates go back to this like artificially low rate that we saw over the past five years, maybe not. But I don't think that is a reason not to purchase now. You do your numbers, and you look at it just because you might say property values are really high interest rates are going up, now's not a good time to buy. That's just laziness. Like, honestly, that's just you being lazy and not wanting to do the work.   There's always great deals out there. You just have to do the work, find them look at the numbers and say even with this increased interest rate, it's still a great deal. I'm still cash flowing and I've got a great cap rate, and you can go ahead and purchase. So I don't think of this as the time really to, to change your decisions on real estate. And part of that has to do with I think, you know, some markets will soften. Some markets may remain flat for a while but that doesn't mean that you're not getting the cash flow and having a great investment that by the way, with inflation where it is If it continues, having an asset where the value goes up with inflation, so I still think now's a great time to purchase real estate. And you might be able to get some fantastic deals as other investors are pulling out, you can really, really go in and get those great deals.   Michael; Love it. And Dana, I'm curious if because we've seen prices go through the roof, and interest rates have also gone up significantly, there might be a bit of a lead lag measure until we see prices come down. So in in terms of looking for different markets, I mean, are you targeting markets that are continuing to grow? Are you targeting markets that maybe are seeing some of that softening in terms of pricing?   Dana: So for us, we go where the real estate investors are. So if there's a real estate investor there, right, we're going to do the property management for them. I think when you're when you're thinking about the lag, that is definitely true. I've heard this with other real estate investors, I've seen it myself, where you see a price. And with interest rates up, the seller puts one price out there, because that's what it was two weeks ago. And suddenly, it's not worth that much. It's worth like 10% 20%. Last, but it's actually really good to put yourself into the position of the seller, and of the real estate agent, because you can actually get some really, really good deals off of that.   And what I mean by it is real estate investors have always told historically, have told their buyers in the past couple of years. If your mark, if your property is on market for over two weeks, people might think there's something wrong with that. And so, you know, we're going to ask for offers on X date, right, like X date and two weeks, or maybe we'll do one week, we're going to ask for offers. Well, if they've missed priced the property, you might be able to go in and you don't know this, but you might be the only offer because they priced it way too high, because we priced it from a purchase price from two weeks ago. And now that has suddenly changed like the market changes every two weeks, it really is. And you could go in and get a great deal. And so I think from from that perspective, there are still fantastic deals out there. But you have to be patient. And some of it will be that luck, where you get the right deal, though what else has gone into, and you can go ahead and purchase that.   So if you put yourself in the other shoes, you might see that you also see a lot of people you know why I don't think it's like 2008 and 2009 is people have a lot more equity in their properties because one value values have gone up. And then two, the interest rates were really low, people could afford more put more money in the market was booming. And so what we're seeing is that more people have equity in them. And at some point, it's emotional for someone, they're like, I just want to get rid of this asset, because I'm gonna go buy another one, or I just really want to move out of the city and move somewhere else. And, you know, to them, maybe 20 To 50 to $70,000 is not a lot depending on what it is. But that is a lot to you. And that changes, changes the numbers on your spreadsheet significantly.   And so I mean, with that purchase price, obviously that matters. But just because the price is out on the market for a property doesn't mean that the price is going to sell for. And so it would be a really good time to go out and experiment with that you will know your market better than anyone else, whatever market you're in, because it will take you bidding on like five properties. And maybe people will laugh at you like your first one, you go like 20% under and they laugh at you. But maybe you get lucky on the fifth one, and you'll get a great deal. But yeah, just follow the numbers in your spreadsheet don't have a purchase price, that doesn't make sense and you're not cash flowing. Or don't change the interest rate hoping that it will go down to that to that amount.   Michael: Yeah, that makes total sense. And speaking of spreadsheet numbers, are you seeing a lot of your investor clients that you work with adjusting their expectations around cash on cash returns? Now that prices and interest rates are up?   Dana: So not really I think most investors like most of the savvy ones we work with, we work with his sort of two different types of of customers, those who had properties just handed to them. And they actually never did the analysis like pan downs from parents and things like that. And then others   Michael: Accidental landlords.   Dana: Accidental Yes. And then others who are very strategic real estate investors and what we have found with them as they have the capital and they might not be they might be with inflation to your point Michael being like, Oh, maybe I should just go buy something because the dollar today is worth less On tomorrow, but no, I actually think most real estate investors are still saying, this is the deal that I got, historically, I want to get something like that. And so they're not changing those expectations on cash on cash return, but they might be going somewhere else. So they go to Roofstock, and they say, Okay, I, you know, couldn't find this property, you know, in my backyard, but on Roofstock, they do have the cash on cash return that I that I that I targeting. And so I do think they're not changing their expectations. But they are going out and finding alternative ways to get the numbers they need.   There's one case, Michael, where I find people change their expectations. And it's first time real estate investors to just get their foot in the door. And I'm actually okay with that. I think that there's too many people who, and for anyone who's listening to this, who doesn't have a real estate investment, you kind of sit there and you kind of fantasize about getting one and then you put so much like anxiety into getting your first property. And once you have your first you're like, oh, okay, that's what I got, here's what it is. And it makes it easier, where then you can go and purchase more properties and more properties. And you know, what you're looking for, and you know what the return was, and you have this process set up.   But the first one is really difficult to get into. So I find that those people today are changing their expectations, for certain metrics just to get into the market, before it's too late. Interest rates go up more, or you know, they're kind of kicking themselves that they didn't get in, you know, four years ago, five years ago. So I only think it's first time real estate investors where that's happening. And I'm actually okay with that. Because I think if you can get more people into real estate investing, and more people to just get their foot in the door, you're going to learn so much off of that first property, that then you're going to say, Okay, this was my cap rate for my first property. My next one, I have to at least have that or better and you kind of improve, you know, it's kind of like dating, you never like you don't date someone who's great. And then like the next person is like a downgrade, you kind of have the standard. And you're like, I can only go up from there. It's the same exact thing with real estate investing. So I really think it's only first time homebuyers where that happens are real estate investors for rental properties?   Michael: Yep, I think and I think that makes tons of sense. It's something that I hear all the time. It's Michael, I'm trying to get my first deal done and has to be amazing. And you know, it has to be a Grand Slam? Like? Don't worry about the grand slams, let's practice getting on base first. And then you'll know how to swing for   Dana: Exactly, exactly. And it makes it a lot easier when you have one property in that area. You know your market a bit more, and then you can kind of purchase some more around at.   Michael: Yep. Yeah, I think it makes him think that's totally right. And so Dana, we're kind of at this like crossroads where we're talking about, some investors are pressing pause on their acquisitions. And then this whole other cohort of investors are like, Oh, crap, I gotta get into the market before interest rates go up further before prices go up further. So it does feel like there's this pressure to buy or there's frenzy to buy, on the one hand, and then there's this whole other group, that's again, kind of taking a step back and saying, let's, let's wait and see what happens. How do you square those two?   Dana: Well, to me, I'm like a pretty unemotional real estate investor. And I feel like for anyone, whatever segment you fall into, you still have to go back to the numbers and see what makes sense. And so I mean, is there a right way to go? I think one people who are not going out, and they're using this as an excuse not to purchase properties, or just being lazy, honestly. And for those who are out there saying, I gotta get in and get my next deal. I think they're almost too emotional. Where they might go in and change the numbers to your point of saying, like, oh, it's not, you know, my last deal was was better than this, but I just need to get my foot in the door. Maybe that's not the right approach to have, it's, Hey, there's gonna be a deal out there. I might have to be a little bit more patient during this the for the next three to six months, I have to be patient, I have to understand what's going on.   But yeah, I just kind of go back to the numbers. I think in both cases, they're they're taking emotion and what's happening in the market and using that, like the macro for the micro. And instead of saying, You know what, I know what is a good deal, here's what it looks like on paper. Let me continue to go search until I find that and it might take you a little bit longer to find it. Or you might find a process like oh, wow, I can, you know, go 20% under and get lucky on a deal off of this, whatever the home price is, I could, you know, undercut them and give them an offer and maybe they'll take it to get that great deal.   Um, But I don't I think both categories are bad. I think someone who says I have to get my foot in the door. Before interest rates go up is emotional. I think someone who says there are no great deals out there are just lazy. And so I kind of fall somewhere in between of saying, yeah, just be financially prudent as you always should be with your real estate investment investments, know your market, know what numbers numbers you need, and make sure you're a little bit more conservative. Like, I know, a couple investors with adjustable rate mortgages that did them, you know, back when interest rates were really low. And I bet they feel pretty stupid right now. So   Michael: we won't name names,   Dana: Won't name names here.   Michael: Well, I'd be very interested to meet the the emotionally lazy person, because it sounds like those are two opposite ends of the spectrum. Yeah, I have to see. Okay. And last thing that I want to ask you about is around expectations. If someone is newer to the investment space, they may be looking to get their first deal done. Everyone around them, their sister, their brother, aunts, uncles in this market are making 10% cash on cash. Yeah, pick a number. Nice round number 10%. And they're like their expectation was was 15%. Right, for whatever reason, that's what makes them tick. That's what gets them excited about an investment. Everyone around them is making 10%. So how the how should investors be thinking about not looking at other people, and just focusing on what's good for them, but also not being blind and naive to what a market is really able to produce? In terms of In other words, like, they I want someone to be excited about the returns that they're getting, but I also want them to be realistic. How do you kind of how do you?   Dana: So the biggest thing I would say to throttle that is, most likely you've sort of selected a market because you've looked at, okay, where is and I mean, Roofstock does this for you, and you guys, I think have some great shows from like every single market of why why you guys are looking at a certain market. So that helps. But you as a real estate investor are gonna say worse population growth? And why like, is more industry going there? Like maybe an Amazon facility was just put into place? Does it have fed, ed's and meds? Like, is it stable, even recession proof, especially now? So you kind of go through and figure out why am I excited about this market? And you just start there? And like, don't forget about your, I mean, 15% cash on cash return? Like, let's just forget about all of that and just go through? What looking at macro, and now we're kind of going to micro to like city level?   Why do I think this is going to be a lot a good market in five to 10 years, because you're going to hold on to these properties and purchase more, right? Do that first, then you say, Okay, this is my market, then what you're going to do is for two to three months, you're going to look at all the deals there, go on Roofstock, I think you could set up alerts because I have those that go to my email that essentially like tell you here's a new property in that market, great purchase. Um, you're gonna go through and you might the first couple of properties, say you know what? Those, those don't really hit my cash on cash return expectations, but now you're starting to know your market and you're gonna see a trend, are they going up? Are they going down? And you can look at that over time to make an unemotional decision that is based on data.   I think that is the most important thing to do. When someone gets in this frenzy of I need this cash on cash return shoot, I'm not going to get it. So I'm just going to slash it. And I'm going to say now I need, you know, seven or 8% I and you're just becoming emotional. But if you go through look at the numbers and you say okay, great, I wanted 15% You know, my friends are getting 10% I'm and you're you change those expectations. And suddenly you say, Okay, I made this decision, and here's my cash on cash return. But I knew at that time, that was the best I could do. Because I looked at the data, then suddenly you never go back and wish you had done it differently. Because you have something that is non non emotional to back you up. And don't compare yourself to other real estate investors. I've seen real estate investors in the past four to five years who've been super successful, who are super stupid.   And the reason they were successful and I hate to say that but like there's so many people out there because basically it was free money like there was so much investment it was there was so much easy money from investors that I saw way too many people also going into real estate. A lot of actually on the fix and flip side that just got lucky because yeah, money was basically free to do a fix and flip and a The home prices were going up astronomically. And they feel like they're the smartest people in the room.   Well, maybe they were at that time, but like, give it two to three months, maybe six months, and the story might change. And so that's why I think it's hard at like one point in time, if you're just getting started to compare yourself to those around you, I don't think you should do that. I think you should just be financially prudent, and make sure that you're not overextending yourself. And you know, your market. And you know why you made the decision, you see you did, and it's all based off those numbers. And it's based off the numbers, but also you need to know the market, like you need to know you guys have neighborhood scores and ratings, that kind of stuff of like, here's why I only invest in neighborhoods that have three stars, or greater, or whatever it may be like it, write all of this stuff out, and take a really methodical approach to your assets, your real estate investing, and I don't think you'll regret it. Like, I don't think you're gonna go back and say, Oh, I really wish I would have gotten that 15% I targeted?   Michael; I think that is like spot on. Thank you so much. And if you missed it, if you missed any part of that, go back, rewind the last three minutes, and listen to that again, cuz I think that's a lot of gold in there. Then this was super fun. As always, if people want to reach out more, find out more about you or hemline. Where's the best place for them to do that?   Dana: Yeah, you can go on to Roofstock when you purchase a property, how many will be listed as a property manager? So go go ahead and do that. You can also go to Hemlane.com. And my email is dana@hemlane.com. So I love hearing from people.   Michael: Awesome. Well, thank you again, and very much looking forward to having you on. Again, I'm sure take care of we'll chat soon.   Dana: Great. Yeah, I'm excited in six months for us to see if we were if we stand corrected on what's going on in the market.   Michael: I know it'd be very interesting. Well keep close tabs on it.   Dana: Great. Thanks so much for having me.   Michael: You got it, take care.   Okay, everyone, and that was our episode A big thank you to Dana for coming on as always big friend of the pod as we were saying at the beginning of the show. As always, if you liked the episode, we'd love to hear from you all with a rating and review and we look forward to seeing the next one. Happy investing

Break Things On Purpose
KubeCon, Kindness, and Legos with Michael Chenetz

Break Things On Purpose

Play Episode Listen Later May 31, 2022 27:57


Today we chat with Cisco's head of developer content, community, and events, Michael Chenetz. We discuss everything from KubeCon to kindness and Legos! Michael delves into some of the main themes he heard from creators at KubeCon, and we discuss methods for increasing adoption of new concepts in your organization. We have a conversation about attending live conferences, COVID protocol, and COVID shaming, and then we talk about how Legos can be used in talks to demonstrate concepts. We end the conversation with a discussion about combining passions to practice creativity. We discuss our time at KubeCon in Spain (5:51) Themes Michael heard at KubeCon talking with creators (7:46) Increasing adoption of new concepts (9:27) We talk conferences, COVID shaming, and blamelessness (12:21) Legos and reliability  (18:04) Michael talks about ways to exercise creativity (23:20) Links: KubeCon October 2022: https://events.linuxfoundation.org/kubecon-cloudnativecon-north-america/ Nintendo Lego Set: https://www.amazon.com/dp/B08HVXMQ87?ref_=cm_sw_r_cp_ud_dp_ED7NVBWPR8ANGT8WNGS5 Cloud Unfiltered podcast episode featuring Julie and Jason:https://podcasts.apple.com/us/podcast/ep125-chaos-engineering-with-julie-gunderson-and-jason/id1215105578?i=1000562393884 Links Referenced: Cisco: https://www.cisco.com/ Cloud Unfiltered Podcast with Julie and Jason: https://podcasts.apple.com/us/podcast/ep125-chaos-engineering-with-julie-gunderson-and-jason/id1215105578?i=1000562393884 Cloud Unfiltered Podcast: https://www.cisco.com/c/en/us/solutions/cloud/podcasts.html Nintendo Lego: https://www.amazon.com/dp/B08HVXMQ87 TranscriptJulie: And for folks that are interested in, too, what day it is—because I think we're all still a little bit confused—it is Monday, May 24th that we are recording this episode.Jason: Uh, Julie's definitely confused on what day it is because it's actually Tuesday, [laugh] May 24th.Michael: Oh, my God. [laugh]. That's great. I love it.Julie: Welcome to Break Things on Purpose, a podcast about reliability, learning from each other, and blamelessness. In this episode, we talk to Michael Chenetz, head of developer content, community, and events at Cisco, about all of the learnings from KubeCon, the importance of being kind to each other, and of course, how Lego translates into technology.Julie: Today, we are joined by Michael Chenetz. Michael, do you want to tell us a little bit about yourself?Michael: Yeah. [laugh]. Well, first of all, thank you for having me on the show. And I'm really good at breaking things, so I guess that's why I'm asked to be here is because I'm superb at it. What I'm not so good at is, like, putting things back together.Like when I was a kid, I remember taking my dad's stereo apart; wasn't too happy about that. Wasn't very good at putting it back together. But you know, so that's just going back a little ways there. But yeah, so I work for the DevRel at Cisco and my whole responsibility is, you know, to get people to know that know a little bit about us in terms of, you know, all the developer-related topics.Julie: Well, and Jason and I had the awesome opportunity to hang out with you at KubeCon, where we got to join your Cloud Unfiltered podcast. So folks, definitely go check out that episode. We have a lot of fun. We'll put a link in the [show notes 00:02:03]. But yeah, let's talk a little bit about KubeCon. So, as of recording this episode, we all just recently traveled back from Spain, for KubeCon EU, which was… amazing. I really enjoyed being there. My first time in Spain. I got back, I can tell you, less than 24 hours ago. Michael, I think—when did you get back?Michael: So, I got back Saturday night, but my bags have not arrived yet. So, they're still traveling and they're enjoying Europe. And they should be back soon, I guess when they're when they feel like they're—you know, they should be back from vacation.Julie: [laugh].Michael: So. [laugh].Julie: Jason, how about you? When did you get home?Jason: I got home on Sunday night. So, I took the train from Valencia to Barcelona on Saturday evening, and then an early morning flight on Sunday and got home late Sunday night.Julie: And for folks that are interested in, too, what day it is—because I think we're all still a little bit confused—it is Monday, May 24th that we are recording this episode.Jason: Uh, Julie's definitely confused on what day it is because it's actually Tuesday, [laugh] May 24th.Michael: Oh, my God. [laugh]. That's great. I love it. By the way, yesterday was my birthday so I'm going to say—Julie: Happy birthday.Michael: —happy birthday to myself.Julie: Oh, my gosh, happy birthday. [laugh].Michael: Thank you [laugh].Julie: So… what is time anyway?Jason: Yeah.Michael: It's all good. It's all relative. Time is relative.Julie: Time is relative. And so, you know, tell us a little bit about—I'd love to know a little bit about why you want folks to know about, like, what is the message you try to get across?Jason: Oh, that's not the question I thought you were going to ask. I thought you were going to ask, “What's on your Amazon wishlist so people can send you birthday presents?”Julie: Yeah, let's back up. Let's do that. So, let's start with your Amazon wishlist. We know that there might be some Legos involved.Michael: Oh, my God, yeah. I mean, you just told me about a cool one, which was Optimus Prime and I just—I'm already on the website, my credit card is out and I'm ready to buy. So, you know, this is the problem with talking to you guys. [laugh]. It's definitely—you know, that's definitely on my list. So, anything that, anything music-related because obviously behind me is a lot of music equipment—I love music stuff—and anything tech. The combination of tech and music, and if you can combine Legos and that, too, man that would just match all the boxes. [laugh].Julie: Just to let you know, there's a Lego Con. Like, I did not know this until last night, actually. But it is a virtual conference.Michael: Really.Julie: Yeah. But one of the things I was looking at actually on Lego, when you look at their website, like, to request one of their speakers, to request one of their engineers as a speaker, they actually don't do that because they get so many requests for their folks to speak at conferences, they actually have a dedicated part of their website that talks about this. So, I thought that was interesting.Michael: Well listen, just because of that, if they want somebody that's in, you know, cloud computing, I'm not going to go talk for Lego. And I know they really want somebody from cloud computing talking to Lego, so, you know… it's, you know, quid pro quo there, so that's just the way it's going to work. [laugh].Julie: I want to be best friends with Lego people.Michael: [laugh]. I know, me too.Julie: I'm just going to make it a goal in life now to have one of their engineers speak at DevOpsDays Boise. It's like a challenge.Michael: It is. I accept it.Julie: [laugh]. With that, though, just on other Lego news, before we start talking about all the other things that folks may also want to hear about, there is another new Lego, which is the Van Gogh Starry Night that has been newly released by the time this episode comes out.Michael: With a free ear, right?Julie: I mean—[laugh].Michael: Is that what happens?Julie: —well played. Well, played. [laugh]. So, now you really got to spend a lot of time at KubeCon, you were just really recording podcast after podcast.Michael: Oh, my God. Yeah. So, I mean, it was great. I love—because I'm a techie, so I love tech and I love to find out origin stories of stuff. So, I love to, like, talk to these people and like, “Why did that come about? How did—” you know, “What happened in your life that made you want to do this? Who hurt you?” [laugh].And so, that's what I constantly try and figure out is, like, [laugh], “What is that?” So, it was really cool because I had, like, Jimmy Zelinskie who came from CoreOS, and he came from—you know, they create, you know, Quay and some of this other kinds of stuff. And you know, just to talk about, like, some of the operators and how they came about, and like… those were the original operators, so that was pretty cool. Varun from Tetrate was supposed to come on, and he created Istio, you know? So, there were so many of these things that I just geek out knowing about, you know?And then the other thing that was really high on our list, and it's really high from where I am, is API quality, API testing, API—so really, that's why I got in touch with you guys because I was like, “Wow, that fits in really good, you know? You guys are doing stuff that's around chaos, and you know, I think that's amazing.” So, all of this stuff is just so interesting to me. But man, it was just a whirlwind of every day just recording, and by the end that was just like, you know, “I'm so sorry, but I just, I can't talk anymore.” You know, and that was it. [laugh].Jason: I love that chatting with the creators. We had Zack Butcher on who is also from Tetrate and one of the early Istio—Michael: Yeah, yeah.Jason: Contributors. And I find it fascinating because I feel like when you chat with these folks, you start to understand the context of why things were built. And it—Michael: Yes.Jason: —it opens your brain up to, like, cool, there's a software—oh, now I know exactly why it's doing things that way, right? Like, it's just so, so eye-opening. I love it.Julie: With that, though, like, did you see any trends or any themes as you were talking to all these folks?Michael: Yeah, so a few real big trends. One is everybody wants to know about eBPF. That was the biggest thing at KubeCon, by far, was that, “We want to learn how to do this low-level kernel stuff that's really fast, that can give us all the information we need, and we don't have to use sidecars and things like that.” I mean it was—you know, that was the most excitement that I saw. OTel was another one for OpenTelemetry, which was a big one.The other thing was simplification. You know, a lot of people were looking to simplify the Kubernetes ecosystem because there's so much out there, and there's so many things that you have to learn about that it was super hard, you know, for somebody to come into it to say, “Where do I even start?” You know? So, that was a big theme was simplification.I'm trying to think. I think another one is APIs, for sure. You know, because there's this whole thing about API sprawl. And people don't know what their APIs are, people just, like—you know, I always say people can see—like, developers are lazy in a good way, and I consider myself one of them. So, what that means is that when we want to develop something, what we're going to do is we're just going to pull down the nearest API that does what we need, that has the best documentation, that has the best blog, that has the best everything.We don't know what their testing strategy is; we don't know what their security strategy is; we don't know if they use other libraries. And you have to figure that stuff out. And that's the thing that—you know, so everything around APIs is super important. And you really have to test that stuff out. Yes, people, you have to test it [laugh] and know more about it. So, those are those were the big themes, I think. [laugh].Julie: You know, I know that Kerim and I gave a talk on observability where we kind of talked more high-level about some of the overarching concepts, but folks were really excited about that. I think is was because we briefly touched on OpenTelemetry, which we should have gone into a little bit more depth, but there's only so much you can fit into a 30-minute talk, so hopefully we'll be able to talk about that more at a KubeCon in the future, we [crosstalk 00:09:54] to the selection committee.Michael: Hashtag topics?Julie: Uh-huh. [laugh]. You know, that said, though, it really did seem like a huge topic that people just wanted to learn more about. I know, too, at the Gremlin booth, a lot of folks were also interested in talking about, like, how do we just get our organization to adopt some of these concepts that we're hearing about here? And I think that was the thing that surprised me the most is I expected people to be coming up to the booth and deep-diving into very, very deep, technical-level questions, and really, a lot of it was how do we get our organization to do this? How can we increase adoption? So, that was a surprise for me.Michael: Yeah, you know what, and I would say two things to that. One is, when you talk about Chaos Engineering, I think people think it's like rocket science and people are really scared and they don't want to claim to be experts in it, so they're like, “Wow, this is, like, next-level stuff, and you know, we're really scared. You guys are the experts. I don't want to even attempt this.” And the other thing is that organizations are scared because they think that it's going to, like, create mass hysteria throughout their organization.And really, none of this is true in either way. In reality, it's a very, very scripted, very exacting stuff that you're testing, and you throw stuff out there and see what kind of response you get. So, you know, it's not this, like, you know—I think people just have—there needs to be more education around a lot of areas in cloud-native. But you know, that's one of the areas. So, I think it's really interesting there.Julie: I think so too. How about for you, Jason? Like, what was your surprise from the conference or something that maybe—Jason: Yeah, I mean, I think my surprise was mostly around just seeing people coming back, right? Because we're now I would say, six months into conferences being back as a thing, right? Like, we had re:Invent last year in Vegas; we had KubeCon last year in LA, and so, like, those are okay events. They weren't, like, back to normal. And this was, I feel like, one of the first conferences, that it really started to feel back to normal.Like, there was much better attendance, there was much more just buzz and hallway tracking and everything else that we're used to. Like, the whole reason that we go to conferences is getting together with people and hanging out and stuff, and this one has so far felt the most back-to-normal out of any event that I've been to over the past six months.Michael: Can I just talk about one thing that I think, you know, people have to get over is, you know, I see a lot online, I think it was—I forget who it was that was talking about it. But this whole idea of Covid shaming. I mean, we're going to this event, and it's like, yeah, everybody wants to get out, everybody wants to learn things, but don't shame people just because they got Covid, everybody's getting Covid, okay? That's just the point of life at this point. So, let's just, you know, let's just be nice to each other, be friendly to each other, you know? I just have to say that because I think it's a shame that people are getting shamed, you know, just for going to an event. [laugh].Julie: See, and I think that—that's an interesting—there's been a lot of conversation around this. And I don't think anybody should be Covid-shamed. Look, I think that we all took a calculated risk in coming—Michael: Absolutely.Julie: To this event. I personally gave out a lot of hugs. I hugged some of the folks that have mentioned that they have come up positive from Covid, so there's a calculated risk in going. I think there has been a little bit of pushback on maybe how some of the communication has come out around it. That said, as an organizer of a small conference with, like, 400 people, I think that these are very complicated matters. And what I really think is important is to listen to feedback from attendees and to take that.And then we're always looking to improve, right?Michael: Absolutely.Julie: If everything that we did was perfect right out of the gate, then we wouldn't have Chaos Engineering because there'd be nothing [crosstalk 00:13:45] be just perfectly reliable. And so, if we take away anything, let's take away—just like what you said, first of all, Covid, you should never shame somebody for having Covid. Like, that's not cool. It's not somebody's fault that they caught an illness.Michael: Yes.Julie: I mean unless they were licking doorknobs. And that's a whole different—Michael: Yes. [laugh]. That's a whole different thing, right there.Julie: Conversation. But when we talk about just like these questions around cultural adoption, we talk about blamelessness; we talk about learning from failure; we talked about finding ways to improve, and I think all of that can come into play. So, it'll be interesting to see how we learn and grow as we move forward. And like, thank you to re:Invent, thank you to KubeCon, thank you to DevOpsDays Boise. But these conferences that have started going back in-person, at great risk to organizers and the committee because people are going to be mad, one way or the other.Michael: Yeah. And you can see that people want to be back because it was huge, you know?Julie: Yeah.Michael: Maybe you guys, I'm going to put in a feature request for Gremlin to chaos engineer crowds. Can we do that so we can figure out, like, what's going to happen when we have these big events? Can we do that?Julie: I mean, that sounds fun. I think what's going to happen is there's going to be hugs, there's going to be people getting sick, but there's going to be people learning and growing.Michael: Yes.Julie: And ultimately, I just think that we have to remember that just, like, our systems aren't perfect, and neither are people. Like, the fact that we expect people to be perfect, and maybe we should just keep some mask mandates for a little bit longer when we're at conferences with 8000 people.Michael: Sure.Julie: I mean, that's—Michael: That makes sense.Jason: Yeah. I mean, it's all about risk management, right? This is, essentially what we do in SRE is there's always a risk of a massive outage, and so it's that balance of, right, do what you can, but ultimately, that's why we have SLOs and things is, you can never be a hundred percent, so like, where do we draw the line of here are the things that we're going to do to help manage this risk, but you can never shoot for a perfectly, entirely safe space, right? Because then we'd all be having conferences in padded rooms, and not touching each other, and things like that. There's a balance there.And I think we're all just trying to find that, so yeah, as you mentioned, that whole, like, DevOps blamelessness thing, you know, treat each other with the notion that we're all trying to get through this together and do what we think is best. Nobody's just like John Allspaw said, you know, “Nobody goes to work thinking that, like, their intent is to crash everything and destroy the company.” No one's going to KubeCon or any of these conferences thinking, “Yeah, I'm going to be a super-spreader.”Julie: [laugh].Michael: Yeah, that would be [crosstalk 00:16:22].Jason: Like, everyone's trying not to do it. They're doing their best. They're not actively, like, aggressively trying to get you sick or intentionally about it. But you know—so just be kind to one another.Michael: Yeah. And that's the key.Julie: It is.Michael: The key. Be kind to one another, you know? I mean, it's a great community. People are really nice, so, you know, let's keep that up. I think that's something special about the, you know, the community around KubeCon, specifically.Julie: As we can refine this and find ways, I would take all of the hugs over virtual conferences—Michael: Yes.Julie: Any day now. Because, as Jason mentioned, is even just with you, Michael, the time we got to spend with you, or the time I kept going up to Jfrog's booth and Baruch and I would have conversations as he made me a delicious coffee, these hallway tracks, these conversations, that's what no one figured out how to recreate during the virtual events—Michael: Absolutely.Julie: —and it's just not possible, right?Michael: Yeah. I mean, I think it would take a little bit of VR and then maybe some, like, suit that you wear in order to feel the hug. And, you know, so it would take a lot more in order to do that. I mean, I guess it's technologically possible. I don't know if the graphics are there yet, so it might be like a pixelated version, like, you know, like, NES-style, or something like that. But it could look pretty cool. [laugh]. So, we'll have to see, you know?Julie: Everybody listening to this episode, I hope you're getting as much of a kick out of it as we are recording it because I mean, there are so many different topics here. One of the things that Michael and I bonded about years ago, for our listeners that are—not years ago; months ago. Again, what is time?Michael: Yeah. What is time? It's all relative.Julie: It is. It was Lego, though, and so we've been talking about that. But Michael, you asked a great question when we were recording with you, which is, like—Michael: Wow.Julie: Can—just one. Only one great question.Michael: [laugh].Julie: [laugh]. Which was, how would you incorporate Lego into a talk? And, like, when we look at our systems breaking and all of that, I've really been thinking about that and how to make our systems more reliable. And here's one of the things I really wanted to clarify that answer. I kind of went… I went talking about my Lego that I build, like, my Optim—not my Optimus Primes, I don't have it, but my Voltron or my Nintendo Lego. And those are all box sets.Michael: Yep.Julie: But one of the things if you're not playing with a box set with instruction, if you're just playing with just the—or excuse me, architecting with just the Lego blocks because it's not playing because we're adults now, I think.Michael: Yes, now it's architecting. Yes.Julie: Yes, now that we're architecting, like, that's one of the things that I was really thinking about this, and I think that it would make something really fun to talk about is how you're building upon each layer and you're testing out these new connection pieces. And then that really goes into, like, when we get into Technics, into dependencies because if you forget that one little one-inch plastic piece that goes from the one to the other, then your whole Lego can fall apart. So anyway, I just thought that was really interesting, and I'd wondered if you or Jason even gave that any more thought, or if it was just fleeting for you.Michael: It was definitely fleeting for me, but I will give it some more thought, you know? But you know, when—as you're saying that though, I'm thinking these Lego pieces really need names because you're like that little two-inch Lego piece that kind of connects this and this, like, we got to give these all names so that people can know, that's x-54 that's—that you're putting between x-53 and x-52. I don't know but you need some kind of name for these parts now.Julie: There are Lego names. You just Google it. There are actual names for all of the parts but—Michael: Wow. [laugh].Julie: Like, Jason, what do you think? I know you've got [unintelligible 00:19:59].Jason: Yeah, I mean, I think it's interesting because I am one of those, like, freeform folks, right? You know, my standard practice when I was growing up with Legos was you build the thing that you bought once and then you immediately, like, tear it apart, and you build whatever the hell you want.Michael: Absolutely.Jason: So, I think that that's kind of an interesting thing as we think about our systems and stuff, right? Like, part of it is, like, yeah, there's best practices and various companies will publish, like, you know, “Here's how to architect such-and-such system.” And it's interesting because that's just not reality, right? You're not going to go and take, like, the Amazon CloudFormation thing, and like, congrats, you're done. You know, you just implement that and your job's done; you just kick back for the rest of the week.It never works that way, right? You're taking these little bits of, like, cool, I might have, like, set that up once just to see what's happening but then you immediately, like, deconstruct it, and you take the knowledge of what you learned in those building blocks, and you, like, go and remix it to build the thing that you actually need to build.Michael: But yeah, I mean, that's exactly—so you know, Legos is what got me interested in that as a kid, but when you look at, you know, cloud services and things like that, there's so many different ways to combine things and so many different ways to, like—you know, you could use Terraform, you could use Crossplane, you could use, you know, any of the services in the cloud, you could use FaaS, you could use serverless, you could use, you know, all these different kinds of solutions and tie them together. So, there's so much choice, and what Lego teaches you is that, embrace the choice. Figure out and embrace the different pieces, embrace all the different things that you have and what the art of possibility is, and then start to build on that. So, I think it's a really good thing. And that's why there's so much correlation between, like, kind of, art and tech and things like that because that's the kind of mentality that you need in order to be really successful in tech.Jason: And I think the other thing that works really well with what you said is, as you're playing with Legos, you start to learn these hacks, right? Like, I don't have, like, a four-by-one brick, but I know that if I have three four-by-one flats, I can stack those three and it's the same height as a brick, right?Michael: Yep.Jason: And you can start combining things. And I love that engineering mentality of, like, I have this problem that I need to solve, I have a limited toolbox for whatever constraints, right, and understanding those constraints, and then cool, how can I remix what I've got in my toolbox to get this thing done?Michael: And that's a thing that I'm always doing. Like, when I used to do a lot of development, you know, it was always like, what is the right code? Or what is the library that's going to solve my problem? Or what is the API that's going to solve my problem, you know?And there's so many different ways to do it. I mean, so many people are afraid of, like, making the wrong choice, when really in programming, there is no wrong choice. It's all about how you want to do it and what makes sense to you, you know? There might be better options in formatting and in the way that you kind of, you know, format that code together and put them in different libraries and things like that, but making choices on, like, APIs and things like that, that's all up to the artist. I would say that's an artist. [laugh]. So, you know, I think it all stems though, when you go back from, you know, just being creative with things… so creativity is king.Jason: So Michael, how do you exercise your creativity, then? How do you keep up that creativity?Michael: Yeah, so there's multiple ways. And that's a great segment because one of the things that I really enjoy—so you know, I like development, but I'm also a people person. And I like product management, but I also like dealing with people. So really, to me, it's about how do I relate products, how do I relate solutions, how do I talk to people about solutions that people can understand? And that's a creative process.Like, what is the right media? What is the right demos? What is the right—you know, what do people need? And what do people need to, kind of, embrace things? And to me, that's a really creative medium to me, and I love it.So, I love that I can use my technical, I love that I can use my artistic, I love that I can use, you know, all these pieces all at once. And sometimes maybe I'll play guitar and just put it in the intro or something, I don't know. So, that kind of combines that together, too. So, we'll figure that piece out later. Maybe nobody wants to hear me play guitar, that's fine, too. [laugh].But I love to be able to use, you know, both sides of my brain to do these creative aspects. So, that's really what does it. And then sometimes I'll program again and I'll find the need, and I'll say, “Hey, look, you know, I realized there's a need for this,” just like a lot of those creators are. But I haven't created anything cool, but you know, maybe someday I will. I feel like it's just been in between all those different intersections that's really cool.Jason: I love the electric guitar stuff that you mentioned. So, for folks who are listening to this show, during our recording of the Cloud Unfiltered you were talking about bringing that art and technical together with electric guitars, and you've been building electric guitar pickups.Michael: Yes. Yeah. So, I mean, I love anything that can combine my music passion with tech, so I have a CNC machine back here that winds pickups and it does it automatically. So, I can say, “Hey, I need a 57 pickup, you know, whatever it is,” and it'll wind it to that exact spec.But that's not the only thing I do. I mean, I used to design control surfaces for artists that were a big band, and I really can't—a lot of them I can't mention because we're under NDA. But I designed a lot of these big, you know, control surfaces for a lot of the big electronic and rock bands that are out there. I taught people how to use Max for Live, which is an artist's, kind of, programming language that's graphical, so [NMax 00:25:33] and MSP and all that kind of stuff. So, I really, really like to combine that.Nowadays, you know, I'm talking about doing some kind of events that may be combined tech, with art. So, maybe doing things like Algorave, and you know, things that are live-coding music and an art. So, being able to combine all these things together, I love that. That's my ultimate passion.Jason: That is super cool.Julie: I think we have learned quite a bit on this episode of Break Things on Purpose, first of all, from the guy who said he hasn't created much—because you did say that, which I'm going to call you out on that because you just gave a long list of things that you created. And I think we need to remember that we're all creators in our own way, so it's very important to remember that. But I think that right now we've created a couple of options for talks in the future, whether or not it's with Lego, or guitar pickups.Michael: Yeah.Julie: Is that—Michael: Hey—Julie: Because I—Michael: Yeah, why not?Julie: —know you do kind of explain that a little bit to me as well when I was there. So, Michael, this has just been amazing having you. We're going to put a lot of links in the notes for everybody today. So, to Michael's podcast, to some Lego, and to anything else Michael wants to share with us as well. Oh, real quick, is there anything you want to leave our listeners with other than that? You know, are you looking to hire Cisco? Is there anything you wanted to share with us?Michael: Yeah, I mean, we're always looking for great people at Cisco, but the biggest thing I'd say is, just realize that we are doing stuff around cloud-native, we're not just network. And I think that's something to note there. But you know, I just love being on the show with you guys. I love doing anything with you guys. You guys are awesome, you know. So.Julie: You're great too, and I think we'll probably do more stuff, all of us together, in the future. And with that, I just want to thank everybody for joining us today.Michael: Thank you. Thanks so much. Thanks for having me.Jason: For links to all the information mentioned, visit our website at gremlin.com/podcast. If you liked this episode, subscribe to the Break Things on Purpose podcast on Spotify, Apple Podcasts, or your favorite podcast platform. Our theme song is called, “Battle of Pogs” by Komiku, and it's available on loyaltyfreakmusic.com.

FairPlay | Challenging Wrongful Convictions with Imran Siddiqui
Michael Thompson | FairPlay EP21 S2 | Life After Clemency

FairPlay | Challenging Wrongful Convictions with Imran Siddiqui

Play Episode Listen Later Apr 24, 2022 59:30


April 24, 2022 | Imran Siddiqui | Justice News | After spending over 2 decades in a Michigan state prison for selling marijuana to an informant in 1994, Michael Thompson is thankful to God that he was saved from life in prison. Michael was granted clemency in 2021 by Michigan Governor Gretchen Whitmer, he wouldn't have been eligible for parole until 2038, he is over 70 - another possible death by incarceration - just for selling some weed, in a state that legalized recreational marijuana in 2018. So why now and how? How did it work out for Michael - Well, this is how it looks like when public pressure becomes something so big that the state can't ignore it anymore. Continue reading on The JBlog - Justice News

The Remote Real Estate Investor
Raising private capital, kids, and generational wealth with Matt Faircloth

The Remote Real Estate Investor

Play Episode Listen Later Mar 5, 2022 35:11


Matt Faircloth is the co-founder and president of the DeRosa Group, a real estate investment company that specializes in buying and renovating residential and commercial properties. Matt and his wife, Liz, started investing in real estate in 2004 with a $30,000 loan. They founded DeRosa Group in 2005 and have since grown the company to managing more than 370 units throughout the east coast. DeRosa has completed more than $30M in real estate transactions involving private capital—including fix-and-flips, single-family home rentals, mixed-use buildings, apartment buildings, office buildings, and tax lien investments. He is the author of Raising Private Capital, has been featured on the BiggerPockets Podcast, and regularly contributes to BiggerPockets' educational webinars. In this episode, Matt shares his background in real estate investing, and a roadmap for investors looking to raise more private capital to close more deals. Additionally, he talks about the reality of running a real estate business.   Episode Links: https://derosagroup.com/ https://www.instagram.com/themattfaircloth/ https://www.linkedin.com/in/mdfaircloth/ https://www.biggerpockets.com/blog/contributors/mattfaircloth --- Before we jump into the episode, here's a quick disclaimer about our content. The Remote Real Estate Investor podcast is for informational purposes only, and is not intended as investment advice. The views, opinions and strategies of both the hosts and the guests are their own and should not be considered as guidance from Roofstock. Make sure to always run your own numbers, make your own independent decisions and seek investment advice from licensed professionals.   Michael: What's going on everyone? Welcome to another episode of the Remote Real Estate Investor. I'm Michael Albaum and today with me I have Matt Faircloth, author, podcast speaker, co-founder, president, investor, syndicator. He does a lot and we're gonna hear a ton from Matt about what he's been doing in the real estate space, and what he's currently putting together and actually closing on today. So let's get into it.   Matt Faircloth, thank you so much for coming on the show today. Really appreciate you taking the time to hang out with me.   Matt: Michael, I appreciate your time and having me on your show, man. Thank you.   Michael: Absolutely, absolutely. So I know a little bit about you but I would love if you could share with our listeners who maybe have never heard of you. They've been living under a rock for the last couple of years, who you are, where you come from, and what you're doing in real estate?   Matt: Where did you come from…   Um, it's cool that my company's called the DeRosa group and I just love saying this, that we're a company dedicated to transforming lads real estate through real estate transforming lives to real estate. We can get into that in the show if you like. I… where I came from, let's see, I grew up Baltimore, bopped around the East Coast for a minute. Before I landed in Philly, met the woman of my dreams because she put Rich Dad Poor Dad in my hand, and we were still dating, that got me to read that. And that that gave got me to drink the entrepreneur Kool Aid, which I guzzled and quit my job in 2005 to start a real estate company, bumped into a lot of walls, you know, did a lot of it, made a lot of mistakes, made some money and then and then just built it and grew over time and just learned how to run an effective real estate company through the school of hard knocks. And now I've been doing it for 16 years and just apply what I've learned over the years, you know, attracted more and more the right people who work with me and build what I think to be a phenomenal brand now.   Michael: Oh, that's awesome, man. That's awesome. You said that once or twice before I can tell it just rolled off your tongue there so nicely.     Matt: You know, this is not my first podcast. Sometimes people ask me, let's just get real, screw it, man. Let's get real right now…   Michael: Let's do it.   Matt: What I get I go on a lot of podcasts and when you go on a lot of podcasts, people tend to ask the same questions, Michael, right and so when they do, it's almost like I'm that guy, I'm the DJ sing in a DJ booth and then in the in the DJ booth of Matt's brain. And then people ask like, Hey, Matt, tell me about your first deal and I'm like, okay, let's get the first deal track pull the first track.   Michael: Go, pull the file.   Matt: You know, yeah, go pull the file, first deal, right. Tell us about the first time that you raise money, tell us about a mistake you made. Okay, let's go ahead skip, let's go pull up mistake file eight. Okay, let's write that file out, right. So it's more fun to go curveball. You know, like…   Michael: Totally   Matt: Yeah, that was a good curveball in the first five seconds of the show that you and I went down right and you into it, you can't help it you end up just going to a script a lot of times you know talking about things on podcast over and over and over again and I was it that a want to be plastic like that, but you end up like, if I've told that story six times the seventh time it starts to come off the same way over and over again, right.   Michael: I totally get it, and I hope that today is not one of those repetitive podcasts.   Matt: You're getting not to be that show already man, you are curve balling, I love it. Keep it up!   Michael: Well as a follow up Matt, what's your favorite mammal, man?   Matt: It's good one, I am, okay, growing up, I have an eight year old, right, so my eight year old is always: Daddy who would win… I wish he was here because you and me, we would have a ball right now… Daddy who would win when a colossal squid or a great white shark? And I'm like Simon, first of all like, but he'll even be like a gorilla or a colossal squid and like girl is gonna drown buddy battle…   Give me more data, that would depth are we talking about the ocean? Are we talking about like 3000 gorillas... To you question, I probably go a gorilla, if I had to pick or, or maybe I don't know why, but growing up I loved Black Panthers.   Michael: Mm hmm. Okay, pretty majestic animals.   Matt: Yeah, I don't know, I don't know, the majestic, they are majestic animals. Yeah, so that would be my favorite, those are my two favorite man…   Michael: I love it, well so real real quick change because we're already on this rabbit hole. You know that there was a show put on by I think NatGeo or discovery that answered your son's questions they would pit these two animals together in a simulation… like that exists…   Matt: You can google and they would show cuz he would be like, daddy who would win a saltwater… It's just you can google saltwater crocodile versus great white shark…   Michael: Great white shark, I saw that episode…   Matt: It's good, it's good, right. Good job displaying well you see the saltwater croc would try and take the deathroll on this or do that...   Oh, he was my son's itch was scratched with that, you know. I don't know, why he is up to the Komodo dragons. Komodo dragon versus anything you can name, that's what you want to talk about…   Michael: That's a battle royale this century… Oh my god. I love it.   Matt: Well, dragons are badasses man, these are like, there they are… Would you know that?   Michael: Yeah, that's the kiss of death, yeah… Matt: It is! Not only the monstrous lizards like little dinosaurs, but they also the venomous bite, you know…   Michael: It's such a ridiculous concept like, oh, let's take two of like humans worst fears, like, long tailed long tongue lizards, and then give it venom, sounds awesome.   Matt: Right! Give it nasty teeth. Yeah, like a really weird awful roar and give them venom, too…   Michael: Oh my god, so good.   Matt: They're nasty creatures, man. Good thing that'll make them in North America.   Michael: I know, I'm stoked, I'm stoked. All right, well, if we bring it slightly back towards the real estate, you know.   Do you want me to do a whole podcast on mammals like komodo dragons… So you started a company, your real estate company in 2005 and when people hear that, I think it might be ominous to some people, you know, what is a real estate company mean? And so what was the transition, like, I mean, like, what is the DeRosa group do first and foremost and then what was that transition, like going from just owning stuff on your own to now I have a business focusing on it?   Matt: That's interesting, you know, that man, um, interesting concept, because a lot of people out there are running real estate investing, like it's a gig, you know, like, or it's like driving Uber, you know, you could just decide to not do it at some point, you know, I mean, it's not a gig, it's a real estate investing is a business because it's a marathon, unless you're wholesaling or just doing a deal here and there something like that. Not for nothing. This business… the business of real estate investing is a business and you should treat it as such. And we didn't always do that the first couple years, I treated it like a hobby and I bumped into walls and did a bunch of different things but like once I really got my legs underneath me, as a real estate investor and really found the calling found the purpose and got and got and got focused on real estate investing. I got clear that it's a business that is like a living animal it's a it's a living thing…   Michael: It's a living Komodo dragon?...   Matt: Real estate investing is like a Komodo dragon, right, it needs food, you know… It can have a venom's bite and can be nasty and shit and can get the fuck out of you. And a lot of people are scared of it, you know, right… Yeah. People read articles about it only exists in certain places we can keep going. But it is something that needs, you know, if you want to grow real estate investing business and sustain yourself in this, in this industry, and not just make it a hobby, you have to have a company that's got you know, clean books and has a purpose and has a mission and has roles and responsibilities and job descriptions and stuff like that, because there's sucky things in real estate you have to do and it's like, well, you know, and you could look on Instagram. And if you look on Instagram for real estate investing, people think that it either means you close deals every day, because it's the people every time people close stuff, they put it on Instagram, or they go to it's like, Instagram thinks that for real estate investors, all you do is close deals, go to conferences and go on vacation That's what you see people doing on Instagram, the real estate investing, right? But there's actually like, this sucky part of real estate investing, which is sitting on your desk and answering emails and you know, just corresponding and looking for deals and swinging and missing and dealing with knucklehead tenants and stuff like that that want to, you know, recently Michael, we had a tenant, had his girlfriend come in and he must have done something bad because she went, put all his clothes on his bed, dumped gasoline on the bed, lit it on fire, walked out.   Michael: Mike dropped…   Matt: This is what happens, that's real stuff, you know… That did not make on Instagram unfortunately, you know…   Michael: No, that wasn't the highlight reel.   Matt: Living my best life, look it's amazing…   Michael: Well, so you bring up a really great point that and that it should be treated like a business and I, I wholeheartedly agree. But so what about all the people out there that are just getting started that could never see themselves as a business owner as an entrepreneur but hear about real estate investing as a great side gig like you mentioned that what about what about all those folks? Where are they left?   Matt: Okay, they need to decide if they want to do it full time or not, right…And there are people out there that have a day job that they love and it's, it's probably something that's very fulfilling to them, or maybe they went to school for a long time, like a doctor or an MD or whatever. I mean, Jesus, those folks go to school, God bless them for like another 12 years after they get out of college, right? So why would they change careers, right? They want, there are people that really in their heart of hearts probably ought to go passive for real estate investing, as a side gig and as a way to build wealth. And there are people that that are doing it because they want to build up the passive income and become a business owner out of it. So you got to choose if you want to be an investor or be, let's remember Robert Kiyosaki Cashflow Quadrant book, right. Yes, ESBI, remember that thing?   Michael: Mm hmm.   Matt: Do you want to be a B or an I, B= business owner, I= investor. And if you're willing to put in your time and and you know, quit your day job eventually become a business owner and that's what you need to do. But unfortunately, people, a lot of people misunderstood Kiyosaki, to think that to be a real estate investor, you have to be an active operator, you have to do it full time. You can make the passive income all you want as an I-quadrate investor and just passively invest in things. And I think that that's, I think it's probably the most misunderstood function in a lot of his books, people that quit their job that really should have never done that they should have just passively invested their way to financial freedom.   Michael: Yeah, okay. And let's talk about that for a minute because you wrote a book about raising capital and I think capital is so often the biggest obstacle for people, the biggest hurdle people overcome. So do you see the kind of this roadmap for people? Where if passivity, is it really time is the goal, right? That's what everybody is after and we get there by either usually being a B or an I, by being at B that sounds terrible, don't be a B. So if people are capital is their obstacle, using real estate as a active vehicle to then take a backseat and invest passively?   Matt: Yeah, well, that's I mean, my book talks about that and then it goes back to like, let's just keep walking to the B and I road, right. So if you're a B quadrant business owner, we're rising D quadrant business owner for real estate, and you either want to do it full time, you already are doing it full time, then at some point, unless you win the lottery, or unless, like, you know, you just got a silver spoon in your mouth, and you got billions of dollars waiting on the sidelines, from your friends from your family or something like that. You're going to need capital, right? You're gonna run out man you are. And so on the other side of it, you've got I quadrate investors, and they have either retirement accounts, real estate equity, cash, any of those things that they want to put to work and not have to put in the time to make that money, you make that money, do what it's supposed to do, you know, then they can those two can marry up the B quadrant business owner of real estate versus the quadrate investor that wants to make a return on their money without trading money for time. Those two can have a really happy partnership. My book talks about all those things, how those two things can get structured together and how the why in my book are called the cash provider, as SI quadrant investor.   Robert Kiyosaki is a good guy, but he probably sue the hell out of me if I use his terms of my books. I didn't use that, I did, I did the the deal provider and the cache provider. The deal provider is the D Quadra business owner, the cache provider is the I quadric investor.   Michael: Okay, awesome and what is your book called?   Matt: Raising private capital. So funny Michael you asked that it happens to be right here behind… They can get it on Amazon or they can get it on biggerpockets.com.   Michael: I was just gonna ask. Alright, so it's called raising private capital and without giving the book away. What can people expect to find in it?   Matt: Along with a lot of my personal story on on you know how I got from guy that quit his job in oh five to you know, running a company that runs that owns, you know, multi 1000 doors of multifamily real estate. It's got that journey in there. And and that but also it's it's got a lot of tools and lessons, it's a how to really on how do you look in your own personal network as an investor, I'm sorry, as a B quadrant designer, it's how to look in your personal network to find the money, you need to do deals because you don't have to go to private lender, or you don't have to go to hard money lenders, you know, if you go and go more corporate level, or sell your soul to get the money you need for the deal that you're trying to do. You can look in your own network to find that money and raising private capital talks about how to find the money you need for deals in your own personal network.   Michael: Okay, all right, Matt can we do something kind of a silly exercise?   Matt: Please.   Michael: Can you because, I think a lot of people are really nervous to have that conversation and I think they feel slimy or gross. Can you pitch me on a deal that you're putting together as someone that would be in your your kind of sphere of influence? Let's let's see. Let's see what that sounds like and feels like.   Matt: Well, it depends if you're accredited, or not, Michael, because if you're not accredited, we have substantial relationship. But if you're accredited, I can talk to you, I can do a Facebook ad that you notice, right? All joking aside, let's pretend you and I are friends. We already know each other you already like and trust me, because I'm me, right and my book recommends that those are your first targets. You know, and that so hey, Michael, how you doing today?   Michael: I'm doing pretty good, what about you, man?   Matt: I'm awesome, man. Hey, listen, I happen to remember you saying that you were working over a company XYZ. You did a great job, didn't you. It's good. But you better get an opportunity to come up with ABC Company. And I'm really grateful for that you were able to move over to that did take on that new job. How's it going?   Michael: It's going really well. XYZ was terrible, ABC is infinitely better. Thank you so much for man, remembering you've got a killer memory.   Matt: No, it's great, I swear to you… I also barely remember going further, Michael, is that XYZ day as much as you hated what they did, and you know, and I'm so grateful you got out of there. But XYZ had a great comp package they did as I remember, you told me they paid you a really great 401k program.   Michael: Yes, yeah, it was pretty.   Matt: Those markets been taken off lately, right. So no, it's maybe maybe hit a top here and is starting to get a little squirrely and everything like that. So I want to tell you that we did you happen to know, Michael, you can take your retirement account and invested in things not Wall Street, you know, in that retirement account you have with XYZ company because you don't work there anymore that retirement account could be put to work in real estate. Did you know that?   Michael: I had heard that. But I didn't really know that I could do anything about it…   Matt: Well, you can now that you've left XYZ company, right, you can take that retirement account that they have, and they probably were paying you and lots of company stock, take the chips, man, take the chips off the table cash in, sell that company stock and roll that and roll that retirement account, which is now by the way was a 401k. Now it was an IRA. And you can roll that IRA over to a third party IRA custodian and you can do all kinds of cool stuff you can buy, you know, shares of companies, you can buy your own your own real estate investments, you can lend that money out and you can also invest it in deals like we have, I, we are right now Michael buying 670 units in two states, five apartment buildings in two states. That's the deal, we're in the middle of right now, produces phenomenal returns, produces, we're going to fix these buildings up and we're going to refinance them over time and as we refinance them, we're going to give some of that money back to you to your retirement account. So you can then take it and parlayed invest in another stuff. It's a great return.   I know a lot of people that we work with are really happy with work that we've done as a company. So you and I should talk further as a matter of fact, I have some Ira custodians that can handle this whole thing for you, if you'd like, I'd like to introduce you to a few of them that I love. You know, and then they we do a lot of work with them. So they give us white glove treatment. Can I introduce you to them for you?   Michael: Yeah, that'd be great, man, thanks so much for doing that. I appreciate it.   Matt: Yeah, and I'm going to mail you the offering. And if you don't, if you're not happy with my, if you don't like the returns, and you're you're nervous, whatever, it's okay, I get other things I can send you over to, I really want to help you build your wealth while I build my business. Because we're building a great real estate company and we're, our mission is to transform lives through real estate, I want you to help me do that. By me helping you earn money with your retirement account. Well, we do the work. So we can do that for you. And if it doesn't work out, that's okay. I have plenty of other friends for this awesome network called biggerpockets.com, you should check out and you can look on BiggerPockets to and find other things to invest in, like private loans and other cool things that can show you that are not real, like that real estate that I mentioned, even though that's a great deal. There's other things you can do to and I'll hold your hand the whole way. What do you think?   Michael: Oh, sign me up, man, I'll be looking for your email.   Matt: Cool, no problem.   Michael: Man, that was awesome. That was so so so good.   Matt: Thank you, thank you…   Michael: So firstly, for first and first and foremost, you've now got to send me that email because I'm sold. But secondly, what I love about what you did is the conversation felt very much, let me help you, let me put provide value for you educate me around what I could do with my retirement funds, which I might have not even been aware of, and then to tell me how you're able to help me, before even the you being helped in the process, being able to your own deals be my financing was even mentioned.   Matt: Yeah, well, so is a few facts, right, um, of the $10 trillion, that's currently in IRAs, right now, not 401k, it's just IRAs of the $10 trillion, it's out there. 4% of us invested in anything else outside of Wall Street and so if you're looking to get your capital game going, the easiest low hanging fruit, and the thing that everybody has is a retirement account that has if they've got a job, and they used to work at one company, and they now work at another company, their retirement account, they had the first company is now eligible to get rolled over to an IRA. And with the big run up the stock markets had it that's what you should be talking to people about, is like, hey, you used to work over here. Now you work here, don't you are you got laid off, you quit whatever it is, they don't have you there them a job. Now they just have to use to have a job. It's such an easy, low hanging fruit conversation and it speaks to their needs too. Because everybody's get a little squirrely and where Wall Street's going, it's just been a great run. You know, it's had a great run over the last 12 years. But now it might be time to pull a few chips back. So I think that that's something that's probably the most underutilized conversation out there. For those looking to raise money, is to talk to anybody that's got a job about investing their retirement account with them with their real estate company.   Michael: That's so good. I think so many people when when thinking about having that conversation, think, well, I don't know anyone who has money, because they might not be in cash assets or liquid assets on the you know, in a taxable account, but the retirement side of things brings into focus a whole another option.   Matt: Yeah. Yeah. Well, you can and there's other ways you can go about it, too. You can kind of sniff out, my book talks about like how to sniff out people that are in your network that likely have a lot of cash. What does what are the signs that a lot of cash leaves, you know, my book talks about that, my book talks about, there's another vehicle that they can they can invest with you and as those are people with free and clear real estate.   Last time I looked, Michael 30% of America owns their home, their primary residence free clear 30%. You know, but they don't. It's not it's not to get paid to ask a different color when it's paid off. It's hard to tell. Like all the purple houses in America are free and clear. Yeah, no, I don't know. So, but my book talks about the signs to look for free and clear real estate. And I also can tell you, here's the free clear real estate conversation. Here's the those with cash conversation and here's the retirement account conversation to have. I just pulled that into my playbook because it seemed like the most obvious one to go for is retirement account is probably the most, it's the most underutilized one. But I think it's the one that's most unnecessary right now, in today's world.   Michael: That makes so much sense, that makes so much sense. Matt, you mentioned before we hit record here that you are actually in the midst of closing the biggest deal that you've ever done to date today. Can you talk to us a little bit about what that looks like?   Matt: That was a by the way, Michael that was it bullshit. That was a real deal. I was pitching you on for your retirement account when you were working for XYZ comm your XYZ IRA could be invested in the deal that we're closing part of right now. Yeah, it's 670 units. It's in it's in two states. It is a five apartment buildings and we're closing two of those today. The other three close in a couple of weeks.   Michael: Amazing, okay, and what attracted you to this deal?   Matt: Um, that okay, so two of the buildings are in Winston Salem, North Carolina, and that is a company that is city we're already heavily invested in and it's a city that's showing phenomenal growth, 14% rent growth last year, RD on pace to do at least 12 this year percent rent growth and this owner hasn't increases rents in the last two. So he hasn't seen any of the rental upside that's been happening, the rent growth has been happening in that market has not been realized on those properties. So great opportunity, we already have property management in that town lined up and Lexington we own six other apartment buildings. So we are a niche down company. We're not going to just invest anywhere that is a good deal. We invest in super specific markets, so those are there were three markets Lexington, Kentucky, the Piedmont triad in North Carolina, and in Lancaster, Pennsylvania, of all places. Those are the three markets that we're in. That's it   Michael: If it works, it works…   Matt: So…I like about it. I also like that it's diverse meaning like it's it's different geographies, different management strategies, even different property conditions. I like all those things about it that it brings a lot of things to the table, that make it more of a stable asset.   Michael: Okay, okay..   Matt: But it's stable investment, like stable here, but poised to go up.   Michael: Okay and we've had a lot of folks on the show recently talking about passive investments. And you know how you're really evaluating the operator more so than the deal itself. But can you give folks listening some tips about how to evaluate maybe the deal? I mean, what, what details of the deal itself should people be looking at to feel comfortable?   Matt: Yeah, um, you should look at…, I'll tell you why I'll tell you, what people will do to make their deal look better than earlier is, you have to look at what their exit criteria is. That meaning like, they might be saying, okay, we're going to buy the property for this number, and then we're going to invest this and then we're going to sell it for this, like that nine times you paid for it, then you investors aren't going to make any money till we sell it, or you're not going to make very much money until we sell it, if the majority of investor returns are projected to come through the sale and the end, the syndicator is assuming that the markets gonna stay very stagnant, that cap rates are gonna stay down and streets gonna stay down, yada, yada, then they're kind of making a lot of assumptions that may or may not come true. So that's one thing to be concerned over. So make sure that they're conservative that their crystal ball is is, you know, that they're looking into has some conservatism's as it in it, because that's one thing. That's one thing, as indeed a syndicator can do is they can predict that the markets going to be super favorable at some point in the future when they go to sell and that makes the deal look really good right now.   Michael: Right, right…   Matt: Yeah, make sure there's a lot of there's some experience on the team that have been it's okay to have new new and to work with new people, because we're all new at some point. But make sure somewhere on their team, there's some deep, there's a deep bench of experience.   Michael: That's great, that's great. Yeah, no, I love those points, I love those points. I think I've seen that too and a bunch of syndication deals like oh yeah, we're gonna buy it at a six cap and we're gonna exit at a three cap and it's like, really look.   Matt: Phenomenal… 22% IRR man, what's the cash flow? Oh, it's only gonna pay like 3% cash on cash. But you know, magic fairy dust, get sprinkled on the deal, and it's gonna get sold and you're gonna make you're gonna triple your money. You know, three right now when I sell it, and that's how it's gonna go, right… When the crypto rises, you know…   Michael: No, that's a great point, those are great points, Matt. And I'm curious to know what do you you know, in your book, I'm sure talks about this but for anyone listening, that's thinking about starting to raise money but doesn't really have experience. They've you know, they've got the hustle, but they don't have the experience and they don't have the capital. You know, what should those people be doing right now?   Matt: Okay, I'm getting smudge get as much exposure as you can. Some folks do that through investing some some people that I know, that are very successful, syndicators now got started investing in other people's deals to learn the ropes, right. And that's it, do that get some exposure, we know why you can to other people's deals, you know, network, do what I did. But to start small, like we're on our 50 we're closing, this is our 15th syndication that we've done. But our first syndication was a guy my wife went to college with put in 50k into it into one into a deal that we did, we bought two single family homes with his 50k, right, that was our first syndication. So you can start small, find the one person that has some capital to work with in your in your network, and do a deal and then expand it out, do another deal, expand it out, do another deal, expand that out, do another deal. So for those that are looking to get started, it's okay to start small. It's not sexy to start small, but it's also okay and there's a lot further there's there's a lot smaller distance to fall and a lot easier to course correct on a small deal than it would be to correct on a behemoth issue first. Michael: Yep, I think that's such a good point, I think that's such a good point. I know I've spoken to people and I thought, well, my first deal would be a 10 year multifamily, because multifamily is the best everyone's talking about it. It's like yeah, okay, well, have you done a single family deal? Well, no…   Matt: I'm telling you, I hear people like, oh, I'm gonna do 100 unit multifamily deal. You know, like, that's my first deal I want to do, I've never done a deal before my life. But I want to close 100 units is my first deal. I get it and I want that, too for you, you know. But you might have to bang your head against the wall a lot. Where you could just go and syndicate a duplex right or syndicate like get your Mama to go give you a couple give me a couple of dollars and you and your Mama would go buy a duplex right, you know…   Michael: But then I can't post it on Instagram. No one wants to see me my mom and me doing deals…   Matt: I can't fake it till I make it that right, you know, or pose next to the Lamborghini that I just bought because I've been, I've been investing in real estate for the last few months.   Michael: So good. The last question I have for you before I let you out of here is, you were talking at the beginning of the show about how you did all these things and kind of rally different directions and then you really niche down and you got really focused. How did you do that? I mean, how did you, what did it take for you to get hyper focused? Because I think so many of us as they get started real estate like, oh, I could do long term buy and hold or I could do flipping or I could do wholesaling or I could do burr investing. And there's so many different ways to go. How do you know when you found the right one?   Matt: Well, first of all, Michael, I just got I just get tired to get my ass kicked, you know…   I'd like to wholesale deals going on at for fix and flips going, I was buying a bunch of rentals and everything like that, and it wasn't sleeping awake, you know and I was doing everything media doing a mediocre level, any of those three things that I was doing, I was involved in some other stuff, too. Any of those three things that I was doing could have gotten to me to my financial goals. But the mistake that I made with all this tribe was doing a bunch of things, mediocre lee versus doing one thing really well, right. And so I found that I was, you know, good at being a landlord, because with the landlord properties that we had raised very well. And it's also good at raising money and explaining what I do land lording in a very simple fashion to people and so I was like, okay, well, I'm awesome at those two things. Let me just focus on those. And the more I focused on those, guess what, Michael, the more money I made, like, money's good. I like making money. I do enjoy my family. You know, that's good. So how about anymore, though? Yeah, I'm not good at managing contractors, some too nice that I believe them when they tell me that their car broke down. And that's why they couldn't show up on the job site, but they still need me to give them 10 grand, you know, and I believe them. Okay, here you go. And that, so I just knew I didn't have people in my network to outsource that to at the time and so it made sense. I had tried partners to run that fix and flip division, my company didn't work out. So I needed to abandon the things that weren't working, and focus on the things that were and for those that are looking to niche down and focus. It doesn't have to it doesn't have to be apartment buildings, believe me, don't listen to Instagram does not have to be apartment buildings. It can be other things, I promise.   But figure out what you were calling your core genius, right? Your God given talents, what are you gonna call it, figure that find out those and how you can best bring those to the real estate table and even better, how they are benefiting your business today. And then just easy, Michael, do more of that. How about that, there's two more of those things, if it's working, you do more of it, and less of the things that aren't, you know, it could be that simple and that's kind of how we grow in and I found people that were able to sit in the seats that I needed for me to focus more on raising money and more on the land lording , and I'd filled in those seats and I got it, you know, tight and I expand that up and I was like okay, land lording is amazing, but I could probably scale faster if I outsource that and hire third party management companies. So we did that I could focus on raising money and I could focus on building the team and enrolling and inspiring and being the leader of my team. Now that's really all I do is I lead my team and I raise money and I talk to you…   Michael: I love it, I love it. That, this has been so much fun Matt, if people have questions for you want to reach out to you are interested in investing in some of your deals, what's the best way for people to get in touch with you?   Matt: There's a ton of stuff on my LinkedIn bio. My LinkedIn is the Matt Faircloth, I'm sure there's plenty of other Matt Faircloth in the world but my Instagram handle…   Michael: You stake your claim…   Matt: I've claimed it, there also the Instagram I'm the only Matt Faircloth, @themattfaircloth and there's a there's a link in my bio on Instagram and there's a ton of stuff there you can go and invest in my and you can hear about investing in deals with us if you're an accredited investor you can join our mailing list because you do a non-accredited deal sometimes for those that are that we have a preexisting relationship with so you can join that list or you know hear more about that. You can buy a copy of my book there you can you know join all kinds of different cool things we have going on and Masterminds webinars, all that jazz is on the link in my bio on Instagram.       Michael: Sweet, well Matt thank you again, man, from Komodo dragons to passive investing, this has been a blast. I'm sure we'll be chatting soon.   Matt: My family and I play a game at dinner called: True two truths and a lie and I'm going to slay it right in two true and a lie there that I was on an interview and me and this guy talked about Komodo dragons. Nobody's gonna believe that. But I totally got my family, totally gonna crush them at true two truths and a lie tonight…   Michael: I love it, I love it. Well, I am glad I could be a part of it.   Matt: Thank you.   Michael: Awesome, take care man.   Alright everyone, that was our episode. A big thank you to Matt for coming on. It was super fun from Komodo dragons to real estate syndication. I didn't think we'd be able to get there but we kept it on the rails. As always, if you liked the episode, please feel free to leave us a rating or review wherever it is you get your podcasts and we look forward to seeing you on the next one. Happy investing!

The Remote Real Estate Investor
How we'd invest $50K, as a beginner and as an experienced investor

The Remote Real Estate Investor

Play Episode Listen Later Feb 26, 2022 21:30


Investing $50,000 in real estate can go a long way toward creating a diversified rental property portfolio that generates strong cash flow, provided that you do it right. Today we are asking each other the question how we would invest this amount of cash. In this episode, Tom, Emil and Michael share how they would invest $50,000 in real estate if they were just starting out, and if they know what they know now. --- Transcript Before we jump into the episode, here's a quick disclaimer about our content. The Remote Real Estate Investor podcast is for informational purposes only, and is not intended as investment advice. The views, opinions and strategies of both the hosts and the guests are their own and should not be considered as guidance from Roofstock. Make sure to always run your own numbers, make your own independent decisions and seek investment advice from licensed professionals.   Emil: Hey, everyone, welcome back for another episode of the Remote Real Estate Investor. My name is Emil Shour and today I'm joined by…   Tom: Tom Schneider   Michael: and Michael Albaum.   Emil: And on today's episode, we're going to be talking about how each of us would invest $50,000 in real estate, and we're gonna frame it as what we would do with that 50k when we were first starting out, versus how we would approach it now, so let's hop into this episode.   Well, I can't ask what's on your guys's mind? Because we just went through that so, huh… Hmm. You know, I used to have this boss that every every meeting every week, he would come in and just ask some random question to avoid the like, so how's everyone doing? That was like, it's a good way to kind of start a meeting, get like really random answers from people.   Tom: You got an example of one?   Emil: He would honestly as a really weird, he's like a weird dude. But like funny, weird. Yeah, probably not suitable for this show. The ones I remember.   Michael: There was a my, my wife loves David Sedaris. And he does a masterclass and he talks about comedy. And one of the questions he loves asking people was, so when was the last time you touched a monkey? He asked him on this and they were like, oh my gosh, like, can you smell it on me, I was working with him earlier at the zoo today? And he was like, no way and it led to him like being able to go play with the monkeys at the zoo. Like and that's why you should always ask random questions.   Emil: He had asked like 400 people, and they all I never spoke to him again, but that one person…   Michael: The one was a big one.   Emil: Then he finally got to meet a monkey at the zoo.   Michael: Yeah…   Tom: Bad news man, getting a baby monkey and then growing up a lot of sad stories about …like ripping arms off. Anyways, sorry…   Michael: That's a… go hard left fast…   Tom: Yeah.   Emil: All right with that we're gonna hop in and talk about real estate. So the topic today is how do you invest 50k? I think this will be interesting. If Michael ever gets it together here.   Michael: Oh man…   Emil: How would you invest 50k If you know what you know, now, but you're just starting out. So take yourself back to you have your current mind, you're going back to when you first started. So how would you invest 50k? And then we'll talk about you're at where you're at currently, you're 50 grand, you want to invest in real estate? What do you guys? What are we all doing? So who wants to kick off? Going back to the past with 50k?   Tom: So, Tom's gonna go first. I would… So me with real estate investing, I really enjoy real estate investing, but I also really enjoy the kind of passive nature of it, more probably more than Michael and Emil, I think they're like, way more active. So I think this is going to be a good diverse range of responses to this question. So what I would probably do so I'd say there's there's two options, right For me, as I also really like single family off of multifamily, just a little bit less to do plus less turns plus XYZ. What I, I would see this as two options, I can either go to, to pick buy two properties in more kind of class C markets, not not as in like, negative, but like smaller markets, right? Talking about like, maybe Birmingham or buy or like Memphis?     Emil: We'll call it Tier 3, it's classy…   Tom: Sure, sure. Sure. Sure. So the my options would be to that or to buy one property in like a Class B area, you know, maybe a, you know, Atlanta, Raleigh, you know, Dallas, one of those guys and where I am right now, if I had 50k, I'm still trying to deploy as much capital out there. I would get debt for sure. I would, I would max out my debt on it. You know, I … we know well, being conscious of not getting over my tips, making sure that my income could support my debt coverage. But I would probably, I'd probably got two properties in one of those smaller markets. But you know, I might have a old fishing pole in the water on some of those larger markets. If something were to come up, I'd cast a wider net, you know, it's a busier acquisition time. So that's why we deployed by SFR, I would look at those smaller markets max, loan to value most of it… That is what I would do, went a little bit long didn't it… Ehmm, yeah. Done…   Michael: Love it. Would you buy… Would you buy both in the same market? Do you think it would use spread them out? Peanut butter spread, as they say…   Tom: I would probably buy them in the same market. Again, like so important to that to develop a thesis when investing in me is a little bit less overhead. So just using a single property manager, you know, doing that work and finding the right property manager, maybe having them help me out on the acquisition side, as far as evaluating neighborhoods and whatnot. So yes, it's a market. Good question, Michael.   Michael: Love it, love it, love it.   Emil: So, Michael, what would you do?   Michael: I think I'm taking that 50,000 and like Tom gonna go get some debt. But I am probably going to go buy a multifamily building, something a little bit bigger that I could, you know, really, really scale with. And it's probably going to be a little more turnkey, because having done the whole multifamily value, add thing, it can often be a lot more expensive than first anticipated. So something that's, you know, relatively easy, stable. That's why you may go to but in close second, what I'm also going to be considering is going and using a 15%, down DSCR loan and going to go purchase a short term rental, which would probably be a single family out in one of those vacation markets that are out there. But I think it can be a really, really, really great use of cash to generate quick income to then go to buy additional properties.     Emil: Michael, for anyone who doesn't know, what is a stable multifamily property, what does that look like?   Michael: Yeah, it's something that has, it's really good question. First off, it's something that has probably already been rehabbed, either extensively or lightly, doesn't have a whole lot of deferred maintenance, rent is probably going to be pretty close to at market rent. So I'm not going to feel the need to, to get new tenants in place when their leases are expiring, because they're already up at market rent. Just something that has been taken care of, or well maintained. Doesn't need a whole lot of CapEx.   Tom: Short term rentals are interesting. How do you find your overhead as an owner relative to your multifamily single family versus long term versus short term rental? Do you find it pretty similar? I would imagine that there's obviously range like there's variants with each of them, but just general ality generally speaking…   Michael: Yeah, it's a big range and it so depends on like my older vintage multifamily, it's gonna be a little bit even less than some of the expense ratio on that just because that has a lot more maintenance, regular, recurring maintenance type issues. On newer single families, comparing across the board to long term versus short term, short term is definitely more expensive from an expense ratio standpoint. But the income generated is still stronger. And so from a cash on cash return, it's it's still performing quite quite well.   Tom: I bought this as a metric, number of times you as an owner, you have to like make a decision or get involved.   Michael: Oh, see, short term versus long term?   Tom: Yeah, yeah, I would think I mean, I would assume short term rental, like there's a little bit more overhead as an owner. Is that wrong?   Michael: Yeah, I don't think that that's, I would say that there is more on the front end. So like we were involved in the decorations and decision making process around what amenities to include, but from a day to day…   Tom: … FF&E and OS&E those are some acronyms, Michael…     Michael: What's a OS&E?   Tom: Oh, OS&E is operating supplies in equipment, and FF&E is furniture, fixtures and equipment.   Michael: Ahhh!   Tom: No big deal, just drop an acronym…   Emil: A unit count into, what's going on here?   Michael: Yeh, sounds like an accounting term.   Tom: I know about luxury man.   Michael: You're just steeped in luxury. But no, I would say other than that. It's pretty much about as hands off as as long term if not more. So. I've really I've made very few decisions, I've been involved in very few of the conversations, we're looking at converting the garage into additional space so that of course, there's a lot more involvement in but that would be the same as if I was doing some kind of rehab work on a long term rental.   Tom: I heard a great story a description of short term rentals as comparing them to fire trucks and that they're constantly getting turned and washed like a fire truck has been around but oh, it gets it gets a fresh wash every time it goes out. So like while you might think it's a you know, getting beat up a lot it perhaps it is but it's it's getting a lot of Washington. It's like a fire truck. I don't know. I like that.   Michael: Yeah, I think I mean, I think so and it's getting eyes in it every turn. So the festering kind of long term deferred maintenance stuff tends to not be again, for my experience as big of an issue because there's people constantly putting eyes on stuff. And if there's an issue you'll hear about it immediately. Like these tenants are going to tell you because they're paying good money to be in these places. Hey, this is an issue you need to fix it.   Emil: Are you is your short term rental being professionally managed, do you have a property manager?   Michael: Yes, yeah, I'm a full service property manager, I definitely pay for it. But I'm not. I'm not at the point where I can set, you know, neither myself or my wife or I are at the point where we have enough time to be able to learn how to do that remotely for this particular property. And you know, if anyone listening is interested in learning more about short term rentals, we did a podcast episode with Avery Carl, which was a phenomenal episode, in my opinion, where she talks all about the short term rental market, and short term rentals in general and things you need to be aware of, if you're going to get involved in this space.   Tom: Did you pencil… Emil needs to give his answer, but just really last question I have on that… Did you pencil it as a longer term rental as well, just to like, see what…   Michael: I did. And it doesn't work. And so I had to always take in the opinion that it has to work as both because if something changes, I don't want to be stuck holding the bag. And after extra chatting with Avery about the short term rental market, this is out in the Smokies. She was like yeah, but the thing of it is, is the regulations aren't going to change out there. Like it is such a through and through short term vacation rental market, that she is not concerned with it being the next Santa Monica or Santa Monica, city regulators come in and say I can't do Airbnb, because it's always been short term rentals. So that's given me a lot more comfort to say, okay, I'm okay, kind of taking that leap of having it only makes sense as a vacation rental?   Emil: Well, I had one final question. I asked Michael about the third party property manager because I, what I really want to know is how does your time commitment with a third, like you have property management and on a long term and a short term? How does your monthly time commitment in terms of speaking with your property manager being involved? Like how, how much more time is it with the short term compared to long term, if any?   Michael: You know, I have probably spent less time with the short term manager than I have with long term management. I was so impressed by this company, they've been awesome and they're just like really good at what they do. And I think that universally speaking, that's kind of what I would expect in the long term world as well, I have my that one of the best property managers I have is up in Alaska, I hear from him, like once a quarter, unless we're just calling to check, you know, checkup and chew the fact sort of thing. So if a property manager is good at their job, you really shouldn't hear from them, in order for you to make decisions, they could update you and tell you what's going on and this and that. But from a decision making standpoint, if I have to hear from you and talk to you regularly, like it's probably not going very well. Right Emil how would you spend in those 50 G's?       Emil: For me, if I'm just starting out, and I want to invest in real estate, I'm, I like single family as a first starting point. And we can debate this later on a showdown. I think single family is a good way to get started, I think having one tenant, one unit to worry about just a lot less hectic. And so I'd start with a single family, I would want to do a tier two city, somewhere where the climate isn't so severe, right? Like I have properties in Indianapolis and every winter, I'm like, man, our pipes gonna freeze and explode. You know, you hear all those stories. Usually, if you have a tenant who's there, like they're running the water, and that doesn't happen. But you know, if you have a turn in the winner, always think that could happen. So I choose something with a little bit less harsh climate, just because it's going to keep everything solid for a little bit longer. And I'd probably just use it on one property to get something a little bit better, ewe just talked about on a different episode, six things we wouldn't do, again, six mistakes and for me it was buying a really cheap property on the… in the beginning, I get something a little bit nicer, less headache, you know, newer build, that's just going to be an easy learning process for me, because the first one isn't going to be the make or break. It's really you're just like learning how to deal with real estate how to deal with the property manager all this stuff. So having it be something that's going to be better long term is what I would prioritize.   Michael: Are you okay, accepting less cash flow?   Emil: I wasn't in the beginning and on the other end of it now, yes, you should like it's not going to be a huge difference. You think it will be and you know, excel math will tell you different but it's a different story. I think when you get into it.   Michael: How much cash flow, how small of a cash flow are you willing to accept and still consider it cashflow positive?   Emil: For me like even like if you're being conservative, right, like not going oh, best case scenario, right? You're ending up with like at least $50 of cash flow a month right? I think that's a good place to be at least obviously, I…   Tom: Got to beat inflation, got to beat inflation.   Michael: Beat it back with a stick…   Emil: We don't, you know, we're just talking about cash flow and again, these this isn't going to be a make or break for you. You're trying to learn and you're trying to grow. You also have equity building right in a better property that's going to be more dollar like appreciation. 10% appreciation on something that's $250,000 Verse $100,000, you're gonna make more than that equity anyway, right? It's appreciating, it's a higher appreciation.   Michael: So you're sticking to one, one property… One more expensive property?   Emil: Yes, yeah.   Michael: Alright.   Emil: Not even just expensive to be expensive just better quote like a turnkey, nicely done property that I'm not going to have a ton of headache right out the gate.   Michael: Well, there you have it, ladies and gentlemen.   Tom: It's been a few seconds on zero scape, just installed some fake turf on my backyard. It's killer man.   Michael: Is it good?   Tom: Yeah, yeah. And then like if leaves come on it you get the power washer. And just like my my own little zen…   Michael: What about dog puppies?   Tom: That's a thing. But you know, that's where the power washer. And also that's where gates like preventing the dog to go out there. Come in…   Emil: Anyway, anyways, you could also have a dog like mine who we have we have turf in the backyard too. It's like turf in concrete. And he is afraid of it doesn't like walking on turf. So he makes us take him out in the front yard where there's real grass to go. So that's fun.   Tom: He is natural… Michael: Some… double apply.   Emil: He's a purist. He's got a good taste.   Tom: Good for him.   Michael: So Tom, are you saving some of that 50,000, so you can install zero scaping in this investment property?   Tom: Yeah, probably. I mean, the right warranties are in place with the Zero Escape. You're like basically making money when you install it, so…   Michael: Are you, are you working on zero escape installation side hustle?   Tom: I am yeah, I got a, I got a, I got some, I got some hints.   Michael: You need a guy, I got a guy…   Emil: Probably not that awesome on a rental property. Like the ROI on that is, is not great.   Tom: Nooo, problem.   Michael: Depends on who is paying this utilities though…   Emil: Yeah…   Michael: If you include these utilities in your bill…   Emil: It's your tenant.   Tom: Oh…There could be markets Emil, before you jump the gun. There could be markets with it makes a ton of sense, Las Vegas, Arizona…   Emil: I prefer talking generalities, we're not getting into nuance on this on this podcast, sorry…   Michael: I thought you only spoken absolutes.   Emil: That's it, that's it…   Michael: Now you're speaking in generalities. Man pick one Emil.   Tom: Yeah.   Emil: Ehmm, absolute is what I met. It's not... Moving on. Alright, what do we do with $50,000 now? If $50,000 is now, in your investing career, what are you guys doing? You're not a beginner, you're at your stage now, so what's next?   Tom: I am making the transition to getting some multifamily, you know, I don't know, I don't actually know short term, Michael's got me hyped up on some learn a lot more about short term, I don't know. I'm all over the place right now. This is what I'm gonna do, this is what I am gonna do actually, I'm going to set up a coaching session with Michael and we're going to go through some options and get to the root of it. I swear to God, that's like the real answer, right.   Emil: That is actually a very solid strategy. Alright, Michael 50,000, I feel like I know where you're, where you're putting money, but if 50,000, where's it going?   Michael: Yeah. Now in today's world, I'm probably splitting that. Truth be told I'm probably do you like for sure a short term rental 50% down DSCR loan, and then I'll probably wait half or two thirds and then I'm taking the other half and I'll probably park it in a syndication to be perfectly honest and just kind of enjoy the passivity that syndications provide. It's, we've been doing a lot of podcasts recently and had a lot of passive investment experts on talking about benefits, pros cons of passive investing, and I'm like, huh at this stage of my career, it's definitely sounds interesting. My back's already, you know, a little tired from from caring so much. So I'm ready to slow down a little bit and just kind of enjoy the fruits of the labor.   Emil: Nice, yeah. I'm sagging into what I'd do, I'm right there with you. So I like that I have nowhere near the amount of units like you, right that I own directly, I have six units. I think that's perfect for me and where I'm at right now, I would put $50,000 honestly, either in a REIT or yeah, in a in a private deal or something like that. Something where I'm going to be completely passive. Just given we've got two little kids, we got the six units again, that we own directly and that takes off takes up enough time and you know, business I started a year ago that's taking up a lot of time as well and attention. So I'd be looking for something passive to pocket.   Michael: I love the fact that Emil, you mentioned that you have like little kids and so you're kind of at this stage in your life where the active hands on direct investment isn't a great fit for you. But that could easily change and so you go park your money and one of these indications. Hopefully it doubles or better in a couple years' time and then you get it back and you get to decide okay, well what I want to do next I want to continue the passive route now maybe the kids a little bit older, you have more time on your hands to do something else. So I love it. I think it's, it's such a good point that there's like seasonality to this whole investing thing.   Emil: Yeah, it's not like, I'm done direct investing. It's, I'm done direct investing right now. Like, we have what we have, we're good, we're not getting rid of those and it's time for a different strategy. But you know, life changes, maybe you have a windfall, whatever, and you're like, now I'm bored. And I want to go do something more challenging and I'm gonna go do some, some value add stuff myself, maybe even like, in a market closer to me, or what did you know there are just so many different ways you can take this and it's not like those strategies you start with is going to be the strategy you end with.   Michael: Mike drop Emil out.   Emil: Don't listen to me, I don't know what I'm talking about.   Michael: That's great, man. I love it, I love it… Should we get out of here?   Emil: Yeah, let's do it.   So thanks, everybody, appreciate you tuning in for another episode, hope you got some value out of this one. And as always, please leave us a review or subscribe if you're watching on YouTube. We love seeing that number go up, it boosts your ego and it keeps us coming back every week. So we'll catch you all in the next one. Happy investing.   Michael: Happy investing.  

The Nazi Lies Podcast
The Nazi Lies Podcast Ep. 13: Replacement Theory

The Nazi Lies Podcast

Play Episode Listen Later Jan 29, 2022 27:41


Mike Isaacson: Of course you're gonna be replaced. No one lives forever. [Theme song] Nazi SS UFOsLizards wearing human clothesHinduism's secret codesThese are nazi lies Race and IQ are in genesWarfare keeps the nation cleanWhiteness is an AIDS vaccineThese are nazi lies Hollow earth, white genocideMuslim's rampant femicideShooting suspects named Sam HydeHiter lived and no Jews died Army, navy, and the copsSecret service, special opsThey protect us, not sweatshopsThese are nazi lies Mike: Hello and welcome to another episode of The Nazi Lies Podcast. Subscribe to our Patreon to join our book club. This should be an interesting episode. I've got Dr. Michael Cholbi with me. He's chair in philosophy at the University of Edinburgh and editor of the volume Immortality and the Philosophy of Death. He's joining me to discuss Replacement theory. Welcome to the podcast, Dr. Cholbi. Michael Cholbi: Thanks very much, I really appreciate the invitation. Mike: All right, so before we get too deep into the philosophy, talk a bit about what you study and how it contributes to the human experience. Michael: Well, I'm a philosopher, and I specialize in particular in ethics. Within ethics, much of my research addresses philosophical issues, ethical issues, related to death and mortality. Some of the issues that I have written on include things like suicide and assisted dying, the desirability of immortality, the rationality of attitudes such as fear toward death, and most recently, working a significant bit on philosophical questions related to grief and bereavement. In terms of what I think it contributes to the human experience--well, I hope it contributes something to the experience--I do think that it's probably the case that even if non-human creatures have some understanding of death, some inchoate understanding of death, we human beings learn at a pretty early age about death, and we learn at a pretty early age as well, that death is ultimately unavoidable. We learn that every creature that we have ever known, every creature that ever will exist including ourselves, does die eventually. And I think as a consequence of that, we have to live our lives in light of that fact. It seems to be pretty clear that our attitudes about death and mortality impact a lot of how we approach the world, what our attitudes are, what our aspirations are. So I'd like to think that philosophy of death or dying is a subject that is relevant to people not because of, you know, their being a member of a profession, or because they come from a certain part of the world or whatever it might be, but simply because they're human and they are aware of the fact of their mortality. I think we all grapple with it, and I think that philosophy has some particular tools or methods that can help people grapple with it in a helpful way. Mike: Now, the reason I wanted to have you on is because I think replacement theory sort of revolves around a fear of death or an inability to grapple with one's own mortality. So there's this idea of being replaced, it's obviously fundamental to the theory itself, and I think this relates to the idea of the first part of your book, “Is death bad for those that die?” I think that replacement theory would answer in the affirmative, and probably most people, though less frantically. So what do philosophers have to say on this question? Does anyone say no? Michael: Well, I actually think there's a pretty significant contingent, right, of philosophers in different traditions who don't think that death is bad for the person who dies, or at least isn't bad necessarily. And I think that those who hold that view fall into several different categories. One category are those philosophers who believed in the afterlife. A significant number of philosophers have worked in Christian and Islamic traditions and of course, according to those traditions, death is not really the end of us; it's more like a transition for us in that we change from being mortal embodied living creatures to being immortal creatures. Not all of the thinkers who believe in afterlife have believed in what we would think of as religions in the usual sense. Socrates famously argued that his death was not going to be bad for him because this was his opportunity to be released from his body and to become acquainted with the eternal and unchanging forms that he believed are the source of all knowledge. Another school of thought that has denied that death is bad for us were the Epicureans and they have their contemporary defenders. Epicurean philosophers believe that death is neither good nor bad for us. Their famous slogan is "Death's nothing to us," and their point of view is that death is the end of us. We don't survive it. There's no afterlife. And because we don't survive it, we don't experience anything bad, there's nothing to be bad about death, and we simply don't exist. So in their view, death is neither bad nor good. Then there's a third school of thought that's a bit more contemporary. Most philosophers who adopt this school of thought would call themselves Deprivationists or Comparativists, and roughly the idea is something like this, that your death can be bad for you, and the way it can be bad for you is that if you die at a particular point in time, then had you not died at that time you would have lived longer, and had you lived longer, there's the possibility that you would have had a better life overall. So were I to die today then that means I would not survive longer, and perhaps had I survived longer, I would have had the opportunity to have a better life, a happier, more fulfilling life, to say. So there's certainly been many schools of philosophical thought, many philosophers, that have thought that death is not bad for us, or at least not necessarily bad for us, I should say. That said, I think it's been one of the sort of perennial questions in philosophy and there are a good number of people on the other side of the ledger who think that there's something deeply terrible about death just insofar as it represents the kind of destruction of our consciousness or of our subjectivity. It's bad simply insofar as it represents the cessation of the existence of the only thing that each of us can really say that we know or count on–ourselves. And maybe that's bad enough to make death bad. Mike: This kind of gets us into the next topic I want to get into. One of the topics that comes up in your book is the idea of life as a narrative arc that concludes with your death. And it seems like that is roundly refuted but it still feels compelling. It forms the basis of most action, adventure, sci fi, fantasy, etc, stories. And it kind of implies destiny, which is something crucial to replacement theory. Even the Comparative approach touched on in the first part of the book takes for granted one's destiny that we compare, you know, beyond one's ultimate death, or one's untimely death. Replacement theory kind of takes this narrative arc story of an individual life and puts it at the meta level with the grand narrative of the nation. So, how do philosophers take on this idea of life as a story, presumably that concludes with one's death? Michael: Well, I certainly think that outside of philosophy and say psychology, we see an abundance of evidence that perhaps one of the defining features of human beings is that we're storytellers, right? We tell stories about ourselves, about other people, about our communities. And it's certainly possible to look at one's life as a narrative, as a kind of story. There are philosophers who have denied that this is sort of essential to us. There's a living philosopher now named Galen Strawson who has essentially said that, or at least from his point of view, he lives his life as a series of disconnected episodes as if there's sort of no narrative, unity, or structure to them at all. And of course, there's also the possibility that we tell stories about our lives or craft narratives about our lives that turn out to be false or incoherent or really don't make any sense. I don't think necessarily that the notion that we view our lives as narratives and our lives as narratives implies destiny. In fact, I think a lot of what people are attempting to do in the course of their lives is to try to craft a life that corresponds to a certain story. So, perhaps you have a life where a certain kind of adversity was present early on in life, but one of the central things that you tried to do was to overcome that adversity, and by the end of your life, it's clear that you had overcome that adversity. That's a pretty common trope in the stories that people aspire to create for their lives. I think at the collective level-- and that seems to be really what sort of Nazi replacements theory is operating at a sort of meta level as you said-- you know, the notion that we aspire to tell stories about ourselves that connect us with others, and in particular connect us with others who will continue to exist after we are gone is a very powerful human equation. I think certainly, many people when they think about what they want out of their lives, they want in some ways their lives to transcend their own biographies, right, to have a legacy, to leave an impact in the world, to improve life for the next generation. In fact there's a philosopher recently, Samuel Scheffler, who has kind of coined this idea of the "collective afterlife" that much of what we do and care about, when we sit back and reflect upon it, seems to assume that there will be people who will exist after we're gone. So if you're a cancer researcher, and you were to learn that in the days after your death the entire earth and the whole human species were to be destroyed by an asteroid, Schaeffler says that would probably change your goals, right? You wouldn't think that curing cancer was so important a goal. So I think it's pretty baked in. I think, to human nature to be able to view our lives as stories, to want our stories to interconnect with other people, other members of our family, our community our nation, our religion. It's actually a very commonplace feature of human life that we struggle with death, and one of the ways that we try to address that struggle, I think, is by crafting a narrative that transcends ourselves as individuals. Mike: All right. So your book ends with a part on immortality, which I think is also important for Replacement theory. This idea that you will somehow live on through your nation or your race or your genes or whatever. It seems like a mystical way of achieving immortality. So, historically philosophically, how do people seek to attain immortality? How does it color the way we navigate the world? Michael: Well, I mean  in some ways I would say that the desire for a kind of immortality that is symbolic, as some people have said, a kind of immortality that doesn't involve literally surviving as an individual, but a kind of immortality that consists in having a legacy or leaving an impact on the world. That kind of immortality is, in some sense, less mystical than in certain other ways of thinking about immortality. I suppose the most mystical or most puzzling is one that I was referring to earlier in our conversation, you know, the notion of an afterlife. It does seem to be on its face puzzling how we can die and be entirely completely dead and yet somehow survive that and come out on the other side, so to speak. But certainly, the various narratives of the afterlife are one of the ways that people have thought they could attain immortality. Another, of course, is what we've been calling legacy through family, culture, religion, nation, and so forth. And a third one-- and this is the one I suppose that sometimes people forget about-- is that you could conceivably attain immortality simply by not dying. [laughs] So you know, if you were to be able to find the proverbial fountain of youth, that would give you eternal life rather than some post mortem immortal life, that'd be a kind of immortality too. I think in terms of the place that thinking about mortality has in human life, you know, there's a school of psychologists led by Sheldon Solomon who put forward something called terror management theory. And as the name suggests, what terror management theory is about is the idea that we human beings are aware of our deaths, and we either find this completely incomprehensible that we could die, or we find it completely terrifying, and either way, we adopt certain strategies, perhaps subconscious or unconscious strategies, to try to manage or address that anxiety. In this respect, the terror management theorists are following upon the work of an anthropologist's writing in the 1970s named Ernest Becker, he wrote a famous book called The Denial of Death. But the terror management theorists in effect say to us, "Well, many of us work very hard to either deny that we die. I suppose that could be one way of looking at belief in the afterlife as kind of the assertion that we simply don't die really. Or we try to live our lives in such a way that we're kind of reassured by the prospect that even if we do die, things that we care about continue, right? Our institutions that we're allied with, the community that we live in, our families, sports clubs that we root for, all of those kinds of things may continue to exist. And that gives us a kind of immortality that's not sort of metaphysical, right? It's not where you actually continue to exist, but I suppose you could call it a symbolic or ethical immortality." But again, I think that I agree with the terror management theorists that somewhere deep in most of our consciousness is the awareness of the fact of our death, and it probably has a huge influence on how we behave individually. It's probably responsible for many of the principal features of human culture. Anthropologists have observed that pretty much every culture that has ever been studied has beliefs and rituals surrounding death, right? [laughs] That's like the starting point for anthropologist's study of the world. So yes, definitely immortality, or striving for immortality, is a way to wrestle or grapple with a mortality that I think we all come to appreciate early on in life. Mike: So, replacement theory has been around for a while although it didn't really have a formal name as a theory until the Christchurch shooter wrote his manifesto, The Great Replacement. One thing I found interesting about the manifesto was the statistic he chooses to focus on. So fascists, racists, xenophobes, they generally appeal to a variety of statistics—racial crime statistics, racial population demographics, not very often racial immigration rates. But the Christchurch shooter chose to focus on racial birth rates. For him, death is the birth of the Other. There's this fear of being bred out. For fascists, there's a sort of philosophical underpinning to this. It has to do with how they view the life and the nation. They consider the nation or identity or whatever, to be literally a living organism or super organism. This implies all the normal things about life–the power of decision making, a lifecycle, etc. For fascists, the nation is a living thing with the state as its power of cognition. This is very similar to one thing we discussed on a previous episode, The Great Chain of Being, this idea that a kingdom is a living organism with the king is the head, and various classes of society as various body parts. So whereas The Great Chain of Being is held together by divine right, fascism is held together by kinship, yielding culture, civilization, politics, economics, etc. This kinship is a unifying force that fuses individuals into an organic nation. And like all living beings, a nation is born; it has a youth, it has a maturation, a frail old age, and an eventual death. Now, fundamentally this comes from a fascist obsession with the organic and applying pseudo-biological models to everything. Anyway, here's my question. How does death shape the way we view non-living phenomena? Michael: Hm. That's the toughest question you've asked me. When we're thinking about non-living phenomenon, are we thinking about just sort of matter? [laughs] Mike: One example you can think of may be like the way that we think of when a computer breaks down, it dies. You know? But also like the idea that a nation in decline is dying or things like that. Michael: Okay, I see. So death as a sort of metaphor for nonliving things, things that can't in some literal sense die. Good. Okay. Again, I think in some ways this goes back to storytelling. There is this well observed psychological tendency we have to attribute agency, personhood, to things that our better selves know aren't agents and don't have personhood. You know, your cell phone breaks down, your cell phone dies on you-- noticed how I used that word dies-- we tend to personify it, right? We sort of think of it as something like an organism. Now, part of that, of course, is simply that thinking of things as having agency, as being person-like, is one of the ways that we try to conceptualize the world around us. And of course, this has some limitations. Sometimes I think you could say that perhaps certain advances in science have been impeded because we have some difficulty in understanding the prospect that events can happen without there being a storyteller or something sort of behind these events that instigates them or chooses them. This is kind of the basis for the infamous argument for God's existence, the argument from design that the world seems so orderly and harmonious in certain sorts of ways. And so this argument tries to infer that that order, that harmoniousness had to have been willed into existence by a god, right? By some sort of divinity. It's certainly, I think, an instinct we have to personify other beings even when they're not persons, to treat them as agents even when they're not agents. I suppose that there's a kind of distortion there as at root in thinking about collective entities as if they are organisms. They're not organisms. And you're certainly right that there's something perhaps misguided about the Nazi replacement theory insofar as it thinks of society as a kind of organism that has these parts that can be healthy or diseased. And I suppose that part of the Nazi ideology has been to try to extirpate the diseased parts in order to preserve and maintain the healthy parts. I'm not sure it's the metaphor that's the problem, but perhaps the particular construal ofit that the Nazi ideology gives, that societies are collectivities or organisms that have these parts that thrive or can be unhealthy on their own. Mike: Okay so there was one article in the volume that at least one review I read took exception to. So the article in question is titled “Constructing Death as a Form of Failure: Addressing Mortality in a Neoliberal Age.” Now I won't make you rehash someone else's article. But I do want to talk about kind of the underriding theme of this article which is the idea that social values shape the way we conceptualize death. So how do social values shape the way we conceptualize death? Michael: I think that particular article was emphasizing a certain way in which contemporary societies sometimes seem to understand death. That death is a sort of failure and that we should attempt to extirpate it, eliminate it if we can, or delay it as long as possible. I mean, certainly many people as they face death, as they become ill and their days become short, some people--not all--do seem to think that their deaths would amount to a kind of failure. Even some physicians have difficulty letting go of the idea that a patient who dies is a patient that they have failed. But I think that's an indication of a sort of broader phenomenon and a broader reality where societies certainly do have values that invite certain interpretations or understandings of the significance of death. Just to give a sort of stark contrast, societies like ours that suppose often that the best sort of life is one that is very productive, where you have a lot of accomplishments, where you enjoy the various kinds of successes and various kinds of material goods. Well, death then looks like the end of all that, and that looks to be a misfortune. Conversely, if one looks at societies or cultures that have a much more communitarian or perhaps cyclical picture of the human condition, they don't necessarily seem to view death as the end of something good or a kind of failure. They view it as a fact that we need to reconcile ourselves to, because again we do eventually die. So I certainly think that our attitudes toward death have very rich logical and evidential interconnections with other things that we care about. And it certainly seems to be that with respect to the theme of your podcast, the Nazi belief system views deaths of white people or white culture or white civilizations as a profound loss, because of course the background ideology is one where those groups or those individuals are supposed to sort of be eternal to reign supreme. And so it's unsurprising then that they would view death as such a detrimental blow to them. Mike: All right. Now obviously, you didn't compile this book as a metaphor for replacement theory. So what do you hope that people get out of your book? Michael: Well, there's of course a collection of articles by a number of scholars--only one of the articles is by me--but I think that what this book can offer people is a richer understanding of two distinct questions that nevertheless interlock or overlap, if you will. So the first question that the book addresses is really the first question you asked about today; is death bad for us? Should we think that it's a bad thing? I think there's a diversity of opinions about this as I mentioned. There are certainly philosophical traditions that have thought that death is bad for us, others that have thought that it isn't bad in fact it's neither good nor bad. Others sort of thought that it may be bad depending upon sort of the circumstances of your death and the circumstances of your life. So I'm hoping that people will garner a more robust understanding of why that's an interesting question and the different ways that philosophers might answer it, and the kinds of arguments they give for their positions. Now, the other question that I think people will gain some insight about is the question of whether immortality would be good for us. It's natural to think that if death is bad for us then it would have to follow that the absence of death, which is to say immortality, would be good for us. But many philosophers have been skeptical about that too. [laughs] They've sort of argued that we're simply not built to be immortal, we would ultimately find the life of an immortal boring and tedious. We would end up like the immortal gods of Greek and Roman mythology where all they seemed to do with their days is sort of meddle in the lives of mortals and create mischief. Others have thought that this would amount to such a distortion of our values, you know, certain kinds of things that we care about in our mortal lives. They wouldn't be sustainable if we were immortal, right? I mean, what would it mean to marry someone, you know, to use that language "till death do us part" if death never comes? [laughs] Would we still value our romantic relationships in the same way? That's just one example where people have wondered whether immortality would in fact alter our values beyond recognition. But I guess what I'm hoping people will see in the book is that those two questions about the value of death and particularly whether it's bad, and on the other hand whether immortality would be good, are both independently interesting, but also, I think, interesting jointly. Because the question of the value of immortality arises very naturally if you believe that in fact death is bad for us. Mike: Okay. Well, Dr. Cholbi, thanks so much for coming on to The Nazi Lies Podcast to talk about death and replacement theory. The book again is Immortality and the Philosophy of Death out from Rowman and Littlefield. Thanks again. Michael: Thank you. It was really a pleasure to talk to you. Mike: If you want to be an upcoming guest with us, join The Nazi Lies Book Club on Patreon. Patrons get access to the Discord server where we host the book club and occasionally share Animal Crossing memes. Patrons also get a bundle of merch for signing up, access to The Nazi Lies Calendar, and advance show notes, transcripts and episodes. See you on the Discord! [Theme song]

Idea Machines
Scientific Irrationality with Michael Strevens [Idea Machines #43]

Idea Machines

Play Episode Listen Later Jan 18, 2022 63:07


Professor Michael Strevens discusses the line between scientific knowledge and everything else, the contrast between what scientists as people do and the formalized process of science, why Kuhn and Popper are both right and both wrong, and more. Michael is a professor of Philosophy at New York University where he studies the philosophy of science and the philosophical implications of cognitive science. He's the author of the outstanding book “The Knowledge Machine” which is the focus of most of our conversation. Two ideas from the book that we touch on: 1. “The iron rule of science”. The iron rule states that “`[The Iron Rule] directs scientists to resolve their differences of opinion by conducting empirical tests rather than by shouting or fighting or philosophizing or moralizing or marrying or calling on a higher power` in the book Michael Makes a strong argument that scientists following the iron rule is what makes science work. 2. “The Tychonic principle.” Named after the astronomer Tycho Brahe who was one of the first to realize that very sensitive measurements can unlock new knowledge about the world, this is the idea that the secrets of the universe lie in minute details that can discriminate between two competing theories. The classic example here is the amount of change in star positions during an eclipse dictated whether Einstein or Newton was more correct about the nature of gravity. Links Michael's Website The Knowledge Machine on BetterWorldBooks Michael Strevens talks about The Knowledge Machine on The Night Science Podcast  Michael Strevens talks about The Knowledge Machine on The Jim Rutt Show    Automated Transcript [00:00:35] In this conversation. Uh, Professor Michael And I talk about the line between scientific knowledge and everything else. The contrast between what scientists as people do and the formalized process of science, why Coon and popper are both right, and both wrong and more. Michael is a professor of philosophy at New York university, where he studies the philosophy of science and the philosophical implications [00:01:35] of cognitive science. He's the author of the outstanding book, the knowledge machine, which is the focus of most of our conversation. A quick warning. This is a very Tyler Cowen ESCA episode. In other words, that's the conversation I wanted to have with Michael? Not necessarily the one that you want to hear. That being said I want to briefly introduce two ideas from the book, which we focus on pretty heavily. First it's what Michael calls the iron rule of science. Direct quote from the book dine rule states that the iron rule direct scientists to resolve their differences of opinion by conducting empirical tests, rather than by shouting or fighting or philosophizing or moralizing or marrying or calling on a higher power. In the book, Michael makes a strong argument that scientist's following the iron rule is what makes science work. The other idea from the book is what Michael calls the Taconic principle. Named after the astronomer Tycho Brahe, who is one of the first to realize that very sensitive measurements can unlock new [00:02:35] knowledge about the world. This is the idea that the secrets of the universe that lie into my new details that can discriminate between two competing theories. The classic example, here is the amount of change in a Star's position during an eclipse dictating whether Einstein or Newton was more correct about the nature of gravity. So with that background, here's my conversation with professor Michael strengthens. [00:02:58] Ben: Where did this idea of the, this, the sort of conceptual framework that you came up with come from? Like, what's like almost the story behind the story here. [00:03:10] Michael: Well, there is an interesting origin story, or at least it's interesting in a, in a nerdy kind of way. So it was interested in an actually teaching the, like what philosophers call that logic of confirmation, how, how evidence supports or undermines theories. And I was interested in getting across some ideas from that 1940s and fifties. Scientists philosophers of science these days [00:03:35] look back on it and think of as being a little bit naive and clueless. And I had at some point in trying to make this stuff appealing in the right sort of way to my students so that they would see it it's really worth paying attention. And just not just completely superseded. I had a bit of a gear shift looking at it, and I realized that in some sense, what this old theory was a theory of, wasn't the thing that we were talking about now, but a different thing. So it wasn't so much about how to assess how much a piece of evidence supports a theory or undermines it. But was it more a theory of just what counts as evidence in the first place? And that got me thinking that this question alone is, could be a important one to, to, to think about now, I ended up as you know, in my book, the knowledge machine, I'm putting my finger on that as the most important thing in all of science. And I can't say it at that point, I had yet had that idea, but it was, [00:04:35] it was kind of puzzling me why it would be that there would, there would be this very kind of objective standard for something counting is evidence that nevertheless offered you more or less, no help in deciding what the evidence was actually telling you. Why would, why would this be so important at first? I thought maybe, maybe it was just the sheer objectivity of it. That's important. And I still think there's something to that, but the objectivity alone didn't seem to be doing enough. And then I connected it with this idea in Thomas Kuhn's book, the structure of scientific revolutions that, that science is is a really difficult pursuit that I've heard. And of course it's wonderful some of the time, but a lot of. requires just that kind of perseverance in the face of very discouraging sometimes. Oh, it's I got the idea that this very objective standard for evidence could be playing the same role that Coon Coon thought was played by what he called the paradigm bar, providing a kind of a very objective framework, which is also a kind of a safe framework, [00:05:35] like a game where everyone agrees on the rules and where people could be feeling more comfortable about the validity and importance of what they were doing. Not necessarily because they would be convinced it would lead to the truth, but just because they felt secure in playing a certain kind of game. So it was a long, it was a long process that began with this sort of just something didn't seem right about these. It didn't seem right that these ideas from the 1940s and fifties could be so, so so wrong as answers to the question. Philosophers in my generation, but answering. Yeah, no, it's, [00:06:11] Ben: I love that. I feel in a way you did is like you like step one, sort of synthesized Coon and popper, and then went like one step beyond them. It's, it's this thing where I'm sure you'd go this, this, the concept that whenever you have like two, two theories that seem equally right. But are [00:06:35] contradictory, that demand is like that, that is a place where, you know, you need more theory, right? Because like, you look at popper and it's like, oh yeah, that seems, that seems right. But then there's you look at Kuhn and you're like, oh, that seems right. And then you're like, wait a minute. Because like, they sort of can't both live in the broom without [00:06:56] Michael: adding something. Although there is something there's actually something I think. Pop Harrington about Koons ideas now. And there's lots of things that are very unpopped period, but you know, Papa's basic idea is science proceeds through reputation and Koons picture of science is a little bit like a very large scale version of that, where we're scientists now, unlike in Papa's story by scientists, we're all desperately trying to undermine theories, you know, the great Britain negative spirits. And with, with, they just assume that that prevailing way of doing things, the paradigm is going to work out okay. But in presuming that they push it to its breaking point. And [00:07:35] that process, if you kind of take a few steps back, has the look of pop and science in the sense that, in the sense that scientists, but now unwittingly rather than with their critical faculties, fully engaged and wittingly are, are taking the theory to a point where it just cannot be sustained anymore in the face of the evidence. And it progresses made because the theory just becomes antenna. Some other theory needs to be counted. So there's at, at the largest scale, there's this process of that, of success of reputation and theories. Now, Coon reputation is not quite the right word. That sounds too orderly and logical to capture what it's doing, but it is nevertheless, there is being annihilated by facts and in a way that's actually quite a period. I think that interesting. [00:08:20] Ben: So it's like, like you could almost phrase Coon as like systemic pop area. Isn't right. To like no individual scientist is trying to do reputation, but then you have like the system eventually [00:08:35] refutes. And that like, that is what the paradigm shift [00:08:37] Michael: is. That's exactly right. Oh, [00:08:39] Ben: that's fast. Another thing that I wanted to ask before we dig into the actual meat of the book is like, wow, this is, this is almost a very, very selfish question, but like, why should people care about this? Like, I really care about it. There's some, and by this, I mean like sort of the, like theories of how science works, right? Like, but I know, I know many scientists who don't care. They're just like, I tried to, I talked to them about that because then they're like, like I just, you know, it's like I do, I do. I think, [00:09:12] Michael: you know, in a way that, and that's completely fine, you know, people to drive a car, you don't know how the engine works. And in fact the best drivers may not have very much mechanical understanding at all. And it's fine for scientists to be a part of the system and do what the system requires of them without really grasping how it works most of the time. 1, 1, 1 way it becomes important is when people start wanting.[00:09:35] Science might not be improved in some ways. So there's a few, there's always a little bit of that going on at the margin. So some string theorists now want to want to relax the standards for what counts as a, as a acceptable scientific arguments so that the elegance or economy of an explanation kind of officially count in favor of a theory as well as, as well as the empirical evidence in the fashion sense. Or there's, there's quite a bit of, of momentum for reform of the publishing system and science coming out of things like the replicability crisis, the idea that actually that, you know, it's talking about science as a game, but science has been gamified to the point where it's being gamed. Yes. And so, you know, there a certain kind of ambitious individual goes into science and yeah, not necessarily. One who has no interest in knowledge, but they, once they see what the rules are, they cannot resist playing those rules to the, to the limit. And what you get is a sequence of scientists sometimes call it the least publishable unit. That's tiny little [00:10:35] results that are designed more to be published and cited in advance of scientist's career than to be the most useful, a summary of research. And then you, and you get time to simply then even worse, choosing their research direction, less out of curiosity, or the sense that they can really do something valuable for the world at large then because they see a narrower and shorter term opportunity to make their own name. Know that's not always a bad thing, but you know, no system of no system of rules, as perfect as people explain the rules more and more that the direction of science as a whole can start to veer a little bit away. Now it's a complicated issue because you changed the rules and you may lose a lot of what's good about the system. Things that you may, it may all look like it's very noble and, and so on, but you can still lose some of what's good about the system as well as fixing what's bad. So I think it's really important to understand how the whole thing works before just charging in and, and, and making a whole series of reforms. [00:11:34] Ben: [00:11:35] Yeah. Okay. That makes a lot of sense. It's like, what are the, what are the actual, like core pieces that, that drive the engine? [00:11:42] Michael: So that's the practical, that's the practical side of the answer to your question. You might, people should care. I thing it's a fascinating story. I mean, I love these kinds of stories. Like the Coon story, where we're at turn, everything turns out to be working in completely different way from the way it seems to be working with that ideology turns out to be not such a great guide to the actual mechanics of the thing. Yeah, [00:12:03] Ben: yeah, no, I mean, yeah. I think that I like that there are some people who just like, think it's fascinating and it's like also just. My, my bias has also the, like how it sort of like weaves between history, right? Like you have to like, really like, look at all of these like fascinating case studies and be like, oh, what's actually going on there. So actually to build on two things you just said could, could you make the argument that with the ref replicability crisis and [00:12:35] like sort of this idea of like P hacking, you're actually seeing, you're seeing what you like th the, the mechanisms that you described in the book in play where it sort of, it used to be that looking at P values was like, like having a good P value was considered sufficient evidence, but then we like now see that, like, having that sufficient P value doesn't, isn't actually predictive. And so now. Everybody is sort of starting to say like, well, maybe like that, that P felt like the using P value as evidence is, is no longer sufficient. And so, because the, the observations didn't match the, the, like what is considered evidence it's like the, what is considered evidence is evolving. Is that like, basically like a case, like, [00:13:29] Michael: exactly. That's exactly right. So the, the whole, the significance testing is one of these, it's a [00:13:35] particular kind of instanciation of the sort of broadest set of rules. We, this whole rule based approach to science where you set up things. So that it's very clear what counts as, as publishable evidence, you have to have a statistically significant results in that P P value testing and stuff is the, is the most widespread of kind of way of thinking about statistical significance. So it's all very straightforward, you know, exactly what you have to do. I think a lot of. Great scientific research has been done and that under that banner, yeah. Having the rules be so clear and straightforward rather than just a matter of some, the referees who referee for journals, just making their own minds up about whether this result looks like a good mind or not. It's really helped science move forward. And given scientists the security, they need to set up research the research programs that they've set up. It's all been good, but because it sort of sets up this very specific role it's possible to, for the right kind of Machiavellian mind to [00:14:35] look at those rules and say, well, let me see. I see some ways, at least in some, in some domains of research where there's plentiful data or it's fairly easy to generate. I see ways that I can officially follow the rules and yet, and technically speaking, what I'm doing is publishing something that's statistically significant and yet. Take a step back. And what happens is, is you may end up with a result, know there's the John you need is one of the, one of the big commentators on this stuff has result. Most published research is false in the title of one of his most famous papers. So you need to step back and say, okay, well, the game was working for a while. It was really, we had the game aligned to people's behavior with what, with what was good for all of us. Right. But once certain people started taking advantage of it in certain fields, at least it started not working so well. We want to hang on to the value we get out of having [00:15:35] very clear objective rules. I mean, objective in the sense that anyone can make a fair judgment about whether the rules are being followed or not, but somehow get the alignment back. [00:15:46] Ben: Yeah. And then, so it's like, so, so that game, that game went out of whack, but then sort of like there's. The broader metagame that is like that that's the, the point of the consistent thing. And then also sort of you, you mentioned string theory earlier, and as I was reading the book, I, I don't think you call this out explicitly, but I, I feel like there are a number of domains that people would think of as science now, but that sort of by your, by, by the iron law would not count. So, so string theory being one of them where it's like very hard, we've sort of reached the limit of observation, at least until we have better equipment. Another [00:16:35] one that came to mind was like a lot of evolutionary arguments were sort of, because it's based on something that is lot like is in the past there there's sort of no way to. To gather additional evidence. W would you say that, like, it's actually, you have a fairly strict bound on what counts as science? [00:16:59] Michael: It is, it is strict, but I think it's, it's not my, it's not in any way. My formulation, this is the way science really is now. It's okay. The point of sciences to is to develop theories and models and so on, and then to empirically test them. And a part of that activity is just developing the theories and models. And so it's completely fine for scientists to develop models and string theory and so on and, and develop evolutionary models of that runway ahead of the evidence. Yeah. I, you know, there where, where, where it's practically very difficult to come up with evidence testimony. I don't think that's exact that in itself is not [00:17:35] unscientific, but then that the question of course immediately comes up. Okay. So now what do we do with these models and, and The iron rule says there's only one, there's only one way to assess them, which is to look for evidence. So what happens when you're in a position with string theory or see with some models and evolutionary psychology in particular where, where it's there's there just is no evidence right now that there's a temptation to find other ways to advance those theories. And so the string theorists would like to argue for string theory on the ground of its it's unifying power, for example, that evolutionary psychologists, I think relying on a set of kind of intuitive appeal, or just a sense that there's something about the smile that sort of feels right. It really captures the experience of being a human being and say, I don't know, sexually jealous or something like that. And that's just not, that is not science. And that is not the sort of thing that. In general published in scientific journals, but yeah, the [00:18:35] question that's come up. Well, maybe we are being too strict. Maybe we, if we could, we would encourage the creation of more useful, interesting illuminating explanatorily powerful models and theories. If we allowed that, allowed them to get some prestige and scientific momentum in ways other than the very evidence focus way. Well, maybe it would just open the gates to a bunch of adventure, idle speculation. Yeah. That was way science down and distract scientists from doing the stuff that has actually resulted in 300 years or so of scientific progress. [00:19:12] Ben: And, and, and your argument would be that like for the ladder, that is well don't [00:19:21] Michael: rush in, I would say, you know, think carefully before you do it. [00:19:25] Ben: No, I mean, I find that that very another, another place where I felt like your framework, [00:19:35] I'm not quite sure what the right word is. Like sort of like there was, there was some friction was, is with especially with the the, the Taconic principle of needing to find like, sort of like very minute differences between what the theory would predict. And the reality is sort of areas you might call it like, like complex systems or emergent behavior and where sort of being able to explain sort of like what the fundamentally, just because you can explain how the building blocks of a system work does like, makes it very hard to make. It does not actually help you make predictions about that system. And I I'm I'm do you have a sense of that? How, how you expect that to work out in with, with the iron rule, because it's, it's like when there are, there are just like so many parameters that you could sort of like, argue like, well, like we either we predicted it or we didn't predict it. [00:20:34] Michael: Yeah, [00:20:35] no. Right. So, so sometimes the productions are so important that people will do the work necessary to really crank through the model. So where the forecast is the best example of that. So getting a weather forecast for five days time, you just spend a lot of money gathering data and running simulations on extremely expensive computers, but almost all of, almost all of science. There just isn't the funding for that. And so you'd never going to be able to make, or it's never going to be practically possible to make those kinds of predictions. But I think these models are capable of making other kinds of predictions. So I mean, even in the case of, of the weather models, you can, without, without, without being able to predict 10 days in advance, as long as you relax your demands and just want a general sense of say whether that climate is going to get warmer, you can make, do with a lot with, with, with many fewer parameters. I mean, in the case of, in a way that's not the greatest example because the climate is so complicated that to, to [00:21:35] even, to make these much less specific predictions, you still need a lot of information and computing power, but I think most, most science of complex systems hinges on hinges on relaxing the, the demands for, for. Of the specificity of the prediction while still demanding some kind of prediction or explanation. And sometimes, and sometimes what you do is you also, you say, well, nevermind prediction. Let's just give me a retrodiction and see if we can explain what actually happened, but the explanation has to be anchored and observable values of things, but we can maybe with some sort of economic incident or evolutionary models are a good example of this weekend. Once we've built the model after the fact we can dig up lots of bits and pieces that will show us that the course of say, we, we, we never could have predicted that evolutionary change would move in a certain direction, but by getting the right fossil evidence and so on, we can see it actually did [00:22:35] move in that direction and conforms to the model. But what we're often doing is we're actually getting the parameters in their model from the observation of what actually happened. So there are these, these are all ways that complex system science can be tested empirically one way or [00:22:52] Ben: another. Yeah. The, the thing that I guess that I'm, I'm sort of hung up on is if you want, like, if you relax the specificity of the predictions that you demand it makes it harder than to sort of compare to compare theories, right? So it's like w the, you have, you know, it's like Newton and Einstein were like, sort of were drastically different models of the world, but in re like the reality was that their predictions were, you need very, very specific predictions to compare between them. And so if, if the hole is in order [00:23:35] to get evidence, you need to re lacks specificity it makes it then harder to. Compare [00:23:41] Michael: theories. No, that's very true. So before you, before you demand, is that theories explain why things fall to the floor when dropped then? Good. Einstein let's go. Aristotle looks. Exactly. Yeah. And one reason physics has been able to make so much progress is that the model, all Sara, the models are simple enough that we can make these very precise predictions that distinguish among theories. The thing in that in complex systems sciences, we often, often there's a fair amount of agreement on the underlying processes. So say Newton versus Einstein. There's what you have is a difference in the fundamental picture of space and time and force and so on. But if you're doing something like economics or population ecology, so that looking at ecosystems, animals eating one another and so on. [00:24:35] That the underlying processes are in some sense, fairly uncontroversial. And the hard part is finding the right kind of model to put them together in a way that is much simpler than they're actually put together in reality, but that still captures enough of those underlying processes to make good predictions. And so I think because the prob that problem is a little bit different. You can, the, the that's, it's less, the, the situation is less a matter of distinguishing between really different fundamental theories and Mora case of refining models to see what needs to be included or what can be left out to make the right kinds of predictions. In particular situations, you still need a certain amount of specificity. Obviously, if you, if you really just say, I'm not going to care about anything about the fact that things fall downwards rather than up, then you're not going to be able to refine your models very far before you run out of. It's to give you any further guidance. That's, that's [00:25:35] very true. Yeah. But typically that complex systems kinds of models are rather more specific than that. I mean, usually they're too specific and they give you, they, they, they say something very precise that doesn't actually happen. Right. And what you're doing is you're trying to bring that, that particular prediction closer to what really happens. So that gives, and that gives you a kind of that gives you something to work towards bringing the prediction towards the reality while at the same time not demanding of the model that already make a completely accurate prediction. [00:26:10] Ben: Yeah. But that makes sense. And so sort of to like another sort of track is like what do you think about like theory free? Predictions. Right? So so like the extremity exam question would be like, could a, like very large neural net do science. Right. So, so if you had no theory at all, but [00:26:35] incredibly accurate predictions, like sort of, how does that square with, with the iron rule [00:26:41] Michael: in your mind? That's a great question. So when I formulate the iron Roy, I build the notion of explanation into it. Yeah. And I think that's functioned in, in an important way in the history of science especially in fields where explanation is actually much easier than prediction, like evolutionary modeling, as I was just saying. Now when you have, if you have the, if you, if your, if your model is an effect, then you're on that, that just makes these predictions it looks, it looks like it's not really providing you with an explanatory theory. The model is not in any way articulating, let's say the causal principles, according to which the things that's predicting actually happen. And you might think for that reason, it's not, I mean, of course this thing could always be an aid there's no, it's not it almost anything can have a place in science as a, as a, as a tool, as a stepping stone. Right. So could you cook, but quickly [00:27:35] you say, okay, we now have we now have we've now finished doing the science of economics because we've found out how to build these neural networks that predict the economy, even though we have no idea how they work. Right. I mean, I don't think so. I don't think that's really satisfying because it's not providing us with the kind of knowledge that science is working towards, but I can imagine someone saying, well, maybe that's all we're ever going to get. And what we need is a broader conception of empirical inquiry. Yeah. That doesn't put so much emphasis on an explanation. I mean, what do you want to do. To be just blindsided by the economy every single time, because you insist on a explanatory theory. Yeah. Or do you want, what do you want to actually have some ability to predict what's going to happen to make the world a better place? Well, of course they want to make the world a better place. So we've, I think we've focused on building these explanatory theories. We've put a lot of emphasis, I would say on getting explanations. Right. But, [00:28:35] but scientists have always have always played around with theories that seem to get the right answer for reasons that they don't fully comprehend. Yeah. And you know, one possible future for science or empirical inquiry more broadly speaking is that that kind of activity comes to predominate rather than just being, as I said earlier, a stepping stone on the way to truly explanatory theories. [00:29:00] Ben: It's like, I sort of think of it in terms of. Almost like compression where the thing that is great about explanatory theories is that it compresses all, it just takes all the evidence and it sort of like just reduces the dimension drastically. And so I'm just sort of like thinking through this, it's like, what would a world in which sort of like non explanatory predictions is like, is fully admissible. Then it just leads to sort of like some exponential [00:29:35] explosion of I don't know, like of whatever is doing the explaining. Right? Cause it just, there there's never a compression. From the evidence down to a theory, [00:29:47] Michael: although it may be with these very complicated systems that even in an explanatory model is incredibly uncompressed. Yeah, exactly. Inflated. So we just have to, I mean, I think it's, it's kind of amazing. This is one of my other interests is the degree to which it's possible to build simple models of complicated systems and still get something out of them, not precise predictions about, about, about what's going to happen to particular components in the system. You know, whether, whether this particular rabbit is going to get eaten yeah. Tomorrow or the next day, but, but more general models about how say increasing the number of predators will have certain effects on the dynamics of the system or, or you know, how the kinds of the kinds of things that population ecologists do do with these models is, is, is answer questions. So this is a bit of an example of what I was saying earlier [00:30:35] about making predictions that are real predictions, but but a bit more qualitative, you know, will. Well one of the very first uses of these models was to answer the question of whether just generally killing a lot of the animals in an ecosystem will lead the the prey populations to increase relatively speaking or decrease. It turns out, but in general they increase. So I think this was after this was in the wake of world war one in Italy George, during world war one, there was less fishing because it's just a sailor, but we're also Naval warfare, I guess, not, maybe not so much in the Mediterranean, but in any case there was, there were, there was less fishing. So it was sort of the opposite of, of killing off a lot of animals in the ecosystem. And the idea was to explain why it was that certain just patterns and that increase in decrease in the populations of predator and prey were served. So some of the first population ecology models were developed to predict. So it's kind of a, and these are tiny. These, this [00:31:35] is, I mean, here you are modeling this ocean. That's full of many, many different species of fish. And yet you just have a few differential equations. I mean, that look complicated, but the amount of compression is unbelievable. And the fact that you get anything sensible out of it at all is truly amazing. So we've kind of been lucky so far. Maybe we've just been picking the low-hanging fruit. But there's a lot of that fruit to be had eventually though, maybe we're just going to have to, and, you know, thankfully there're supercomputers do science that way. Yeah. [00:32:06] Ben: Or, or, or developed sort of a, an entirely different way of attacking those kinds of systems. I feel like sort of our science has been very good at going after compressible systems or I'm not even sure how to describe it. That I feel like we're, we're starting to run into all of these different systems that don't, that sort of aren't as amenable [00:32:35] to to, to Titanic sort of like going down to really more and more detail. And so I, I I'd always speculate whether it's like, we actually need like new sort of like, like philosophical machinery to just sort of like grapple with that. Yeah. [00:32:51] Michael: When you modeling, I mean, festival, they might be new modeling machinery and new kinds of mathematics that make it possible to compress things that were previously incompressible, but it may just be, I mean, we look at you look at a complicated system, like the, like in an ecosystem or the weather or something like that. And you can see that small, small differences and the way things start out can have big effects down the line. So. What seems to happen in these cases where we can have a lot of compression as that, those, although those small, those there's various effects of small, small variations and initial conditions kind of cancel out. Yeah. So it may be, you change things [00:33:35] around and it's different fish being eaten, but still the overall number of each species being eaten is about the same, you know, it kind of all evens out in the end and that's what makes the compression possible. But if that's not the case, if, if these small changes make differences to the kinds of things we're trying to predict people, of course often associate this with the metaphor of the butterfly effect. Then I dunno if compression is even possible. You simply, well, if you really want to predict whether, whether there's going to be an increase in inflation in a year's time or a decrease in inflation, and that really every person that really does hinge on the buying decisions of. Some single parent, somewhere in Ohio, then, then you just need to F to, to figure out what the buying decisions of every single person in that in the economy are in and build them in. And yet at the same time, it doesn't, it, it seems that everyone loves the butterfly effect. [00:34:35] And yet the idea that the rate of inflation is going to depend on this decision by somebody walking down the aisles of a supermarket in higher, that just doesn't seem right. It does seem that things kind of cancel out that these small effects mostly just get drowned out or they, they kind of shift things around without changing their high-level qualitative patents. Yeah. Well, [00:34:56] Ben: I mean, this is the diversion, but I feel like that that sort of like touches right on, like, do you believe in, in like the forces theory of history, more like the great man theory of history, right? And then it's like, and people make arguments both ways. And so I think that. And we just haven't haven't figured that out. Actually split like the speaking of, of, of great man theory of history. The thing, like an amazing thing about your book is that you, you sort of, I feel like it's very humanistic in the sense of like, oh, scientists are people like they do like lots of things. They're [00:35:35] not just like science machines. And you have this, like this beautiful analogy of a coral reef that you, that, that scientists you know, contribute, like they're, they're, they're like the living polyps and they build up these they're, they're sort of like artifacts of work and then they go away and it, they, the new scientists continue to build on that. And I was sort of wondering, like, do you see that being at odds with the fact that there's so much tacit knowledge. In science in the sense that like you F for most fields, I found you probably could not reconstruct them based only on the papers, right? Like you have to talk to the people who have done the experiments. Do you see any tension [00:36:23] Michael: there? Well, it's true that the, the metaphor of the coral reef doesn't doesn't capture that aspect of science. It's very true. So I think on the one hand that what's what is captured by the metaphor is the idea that the, [00:36:35] the, what science leaves behind in terms of, of evidence that can is, is, is interpreted a new every generation. So each new generation of scientists comes along and, and, and, and sort of looks at the accumulated fact. I mean, this is going to sound it, this is, this makes it sound. This sounds a little bit fanciful, but you know, in some sense, that's, what's going on, looks at the facts and says, well, okay, how shall I, what are these really telling me? Yeah. And they bring their own kind of human preconceptions or biases. Yeah. But none of these break-ins the preconceptions and biases are not necessarily bad things. Yeah. They look at it in the light of their own mind and they are reinterpret things. And so the scientific literature is always just to kind of a starting point for this thought, which, which really changes from generation to generation. On the other hand, at the same time, as you just pointed out, scientists are being handed certain kinds of knowledge, [00:37:35] which, which are not for them to create a new, but rather just to kind of learn how to just have a use various instruments, how to use various statistical techniques actually. And so there's this continuity to the knowledge let's, as I say, not captured at all by the reef metaphor, both of those things are going, are going on. There's the research culture, which well, maybe one way to put it. It's the culture, both changes stays the same, and it's important that it stays the same in the sense that people retain their, know how they have for using these instruments until eventually the instrument becomes obsolete and then the culture is completely lost, but it's okay. Most of the time if it's completely lost. But on the other hand, there is this kind of always this fresh new re-interpretation of the, of the evidence simply because the the interpretation of evidence is is a rather subjective business. And what the preceding generations are handing on is, is not, is, should be seen more as a, kind of [00:38:35] a data trove than, as, than a kind of a body of established knowledge. But [00:38:43] Ben: then I think. Question is, is it's like, if, what counts as evidence changes and all you are getting is this data trove of things that people previously thought counted as evidence, right? Like, so you know, it's like, they all, all the things that were like, like thrown out and not included in the paper doesn't like that make it sort of harder to reinterpret it. [00:39:12] Michael: Well, there's, I mean, yeah. The standards for counselors, evidence, I think of as being unchanging and that's an important part of the story here. So it's being passed on, it's supposed to be evidence now of course, some of it, some of it will turn out to be the result of faulty measurements, all these suspicious, some of that even outright fraud, perhaps. And so, and so. To some extent, that's [00:39:35] why you wouldn't want to just kind of take it for granted and they get that, that side of things is not really captured by the reef metaphor either. Yeah. But I think that the important thing that is captured by the metaphor is this idea that the, what, what's the thing that really is the heritage of science in terms of theory and evidence, is that evidence itself? Yeah. It's not so much a body of knowledge, although, you know, that knowledge can, it's not that it's, it's not, it's not that everyone has to start from scratch every generation, but it's, it's this incredibly valuable information which may be, you know, maybe a little bit complicated in some corners. That's true, but still it's been generated according to the same rules that or, you know, 10 to. by the same rules that we're trying to satisfy today. Yeah. And so, which is just as [00:40:35] trustworthy or untrustworthy as the evidence we're getting today. And there it is just recorded in the animals of science. [00:40:41] Ben: So it's much more like the, the thing that's important is the, like the, the process and the filtering mechanism, then the, the, the specific artifacts that yeah. [00:40:55] Michael: Come out, I'll make me part of what I'm getting at with that metaphor is the scientists have scientists produce the evidence. They have their, an interpretation of that evidence, but then they retire. They die. And that interpretation is not really, it doesn't need to be important anymore enough and isn't important anymore. Of course, they may persuade some of their graduate students to go along with their interpretation. They may be very politically powerful in their interpretation, may last for a few generations, but typically ultimately that influence wanes and What really matters is, is, is the data trove. Yeah. I mean, we still, it's not, as you, as you said, it's not perfect. We have to regard it with that [00:41:35] somewhat skeptical eye, but not too skeptical. And that's the, that's the, the real treasure house yeah. Of [00:41:43] Ben: science and something that I was, I was wondering, it's like, you, you make this, this really, you have a sentence that you described, you say a non event such as sciences non-rival happens, so to speak almost everywhere. And I would add, like, it happens almost everywhere all the time, and this is, this is wildly speculative. But do you think that there would have been any way to like, to predict that science would happen or to like no. There was something missing. So like, could, could we then now, like, would there be a way to say like, oh, we're like, we're missing something crucial. If that makes sense, like, could we, could we look at the fact that [00:42:35] science consistently failed to arrive and ask, like, is there, is there something else like some other kind of like like intellectual machinery that also that has not arrived. Did you think, like, is it possible to look for that? [00:42:51] Michael: Oh, you mean [00:42:52] Ben: now? Yeah. Or like, like, or could someone have predicted science in the past? Like in [00:42:57] Michael: the past? I, I mean, okay. I mean, clearly there were a lot of things, highly motivated inside. Why is thinkers. Yeah. Who I assume I'd have loved to sell the question of say configuration of the solar system, you have that with these various models floating around for thousands of years. I'm not sure everyone knows this, but, but, but, but by, you know, by the time of the Roman empire, say that the model with the sun at the center was well known. The muddle with the earth at the central is of course well known and the model where the earth is at the center, but then the [00:43:35] sun rotates around the earth and the inner planets rotate around the sun was also well known. And in fact was actually that this always surprises me was if anything, that predominant model in the early middle ages and in Western Europe, it had been kind of received from late antiquity from that, from the writers at the end of the Roman empire. And that was thought to be the, the kind of the going story. Yeah. It's a complicated of course, that there are many historical complications, but I, I take it that someone like Aristotle would have loved to have really settled that question and figured it out for good. He had his own ideas. Of course, he thought the earth had to be at the center because of its that fit with his theory of gravity, for example, and made it work and having the Senate, the city just wouldn't wouldn't have worked. And for various other reasons. So it would have been great to have invented this technique for actually generating evidence that that in time would be seen by everyone has decisively in favor of one of these theories, the others. So they must have really wanted it. [00:44:35] Did they think, did they themselves think that something was missing or did they think they had what they needed? I think maybe Aristotle thought he had what was needed. He had the kind of philosophical arguments based on establishing kind of coherence between his many amazing theories of different phenomena. Know his. Falling bodies is a story about that. The solar system, as of course, he would not have called it the, the planets and so on, and it all fit together so well. And it was so much better than anything anyone else came up with. He may have thought, this is how you establish the truth of, of of the geocentric system with the earth at the center. So now I don't need anything like science and there doesn't need to be anything like science, and I'm not even thinking about the possibility of something like science. Yeah. And that, to some extent, that explains why someone like Aristotle, who seemed to be capable of having almost any idea that could be had, nevertheless did [00:45:35] not seem to have, sort of see a gap to see the need, for example, for precise, qualitative experiments or, or, or even the point of doing them. Yeah. It's, you know, that's the best, I think that's the most I can say. That I don't, I let myself looking back in history, see that people felt there was a gap. And yet at the same time, they were very much aware that these questions were not being said, or [00:46:04] Ben: it was just it just makes me wonder w w some, some period in the future, we will look back at us and say like, oh, that thing, right. Like, I don't know, whatever, like, Mayans, right? Like how could you not have figured out the, like my antigenic method? And it's just it, I, I just find it thought provoking to think, like, you know, it's like, how do you see your blind spots? [00:46:32] Michael: Yeah. Well, yeah, I'm a philosopher. And we in, in [00:46:35] philosophy, it's still, it's still much like it was with Aristotle. We have all these conflicting theories of say you know, justice. What, what really makes the society just to what makes an act. Or even what makes one thing cause of another thing. And we don't really, we don't know how to resolve those disputes in a way that will establish any kind of consensus. We also feel very pleased with ourselves as I take it. Aristotle's are these really great arguments for the views? We believe in me, that's still sort of quite more optimistic maybe than, than we ought to be. That we'll be able to convince everyone else. We're right. In fact, what we really need and philosophers, do you have this thought from time to time? There's some new way of distinguishing between philosophical theories. This was one of the great movements of early 20th century philosophy. That logical positivism was one way. You can look at it as an attempt to build a methodology where it would be possible to use. [00:47:35] And in effect scientific techniques to determine what to, to adjudicate among philosophical theories, mainly by throwing away most of the theories as meaningless and insufficiently connected to empirical facts. So it was a, it was a brutal, brutal method, but it was an idea. The idea was that we could have, there was a new method to be had that would do for philosophy. What, what science did for, you know, natural philosophy for physics and biology and so on. That's an intriguing thought. Maybe that's what I should be spending my time thinking about, please. [00:48:12] Ben: I, I do want to be respectful of your time, the like 1, 1, 1 last thing I'd love to ask about is like, do you think that and, and you, you talked about this a bit in the book, is that, do you think that the way that we communicate science has become almost too sterile. And sort of one of my, my going concerns [00:48:35] is this the way in which everybody has become like super, super specialized. And so, and sort of like once the debate is settled, creating the very sterile artifacts is, is, is useful and powerful. But then as, as, as you pointed out as like a ma as a mechanism of like, actually sort of like communicating knowledge, they're not necessarily the best. But, but like, because we've sort of held up these like sterile papers as the most important thing it's made it hard for people in one specialization to actually like, understand what's going on in another. So do you think that. That, that, that we've sort of like Uber sterilized it. You know, it's like, we talked earlier about people who want to, to change the rules and I'm very much with you on like, we should be skeptical about that. But then at the same time you see that this is going [00:49:35] on. [00:49:35] Michael: Yeah. Well, I think, I mean, there's a real problem here, regardless, you know, whatever the rules of the problem of communicating something as complicated as scientific knowledge or the really, I should say the state of scientific play because often what needs to be communicated is not just somebody that's now been established beyond any doubt, but here's what people are doing right now. Here's the kind of research they're doing here are the kinds of obstacles they're running into to communicate, to, to put that in a form where somebody can just come along and digest it all easily. I think it was incredibly difficult, no matter what the rules are. Yeah. It's probably not the best use of most scientists time and to try to present their work in that way. It's better for them just to go to the rock face and start chipping away at their and little local area. So what, what you need is either for a scientist to take time out from time to time. And I mean there exists these publications review [00:50:35] publications, which try to do this job. That's true. So that people in related fields, you know, typically in the typically related fields means PhD in the same subjects. They're usually for the nearest neighbors to see what's going on, but often they're written in ways that are pretty accessible. I find. So then you create, you create a publication that simply has a different set of rules. The point here is not to in any way to evaluate the evidence, but simply to give a sense of the state of play for. To reach further a field, you have science journalists or what's going on with newspapers and magazines right now is because it's not very good for serious science journalism. And then you have scientists and people like me, who, for whatever reason, take some time out from what they usually do to really, really look kind of a self-standing project to explain what's going on those activities all to some extent, take place outside the narrow narrow view of the [00:51:35] iron rule. So, and I think, I think it's, it's going okay. Given the difficulty of the task. It seems to me that that the, the, the knowledge of the information is being communicated in a, in a somewhat effective, accessible way. I mean, not that if anything, the real, the real, the real barriers to. Some kinds of fruitful, interdisciplinary thinking, not just that it's hard for one mind to simply take on all this stuff that needs to be taken on no matter how effectively, even brilliantly it's communicated the world is just this very complicated place. Yeah. You know, one, one thing I'm interested in historically not, I mean, just, I find fascinating is that fruitfulness of certain kinds of research programs that came out of came out of finding serious wars, like in particular, the second world war, you threw a bunch of people together and they had to solve some problem, like [00:52:35] building at a bomb , it's usually something, something horrendous or a a device, the device for the guns and bombers and so on that would allow that. To rather than having to bit very skillfully. I forget the word for it. You know, you kind of have to put your guide ahead of where the enemy fighter so by the time that your, your, your bullets get there, the plane arrives at the same time, but they built these really sophisticated analog computers basically would do the job. So the Ghana, some, you know, some 19 year olds, like just pointed the plane again. Yeah. And a lot of problems to do with logistics and weather forecasting. And so on this, these, these, the need to have that done through together, people from very different areas in engineering and science and so on and resulted in this amazing explosion. I think if knowledge [00:53:35] it's a very, it's a very attractive period in the history of human thought. When you go back and look at some of the things people were writing in the late forties and fifties, Computers, how the mind works. And so on. And I think some of that is coming out from this, this kind of almost scrambling process that that happened when, when these very specific kind of military engineering problems are solved by throwing people together who never normally would have talked to one another. Maybe we need a little bit of that. Not the war. Yeah. But [00:54:08] Ben: I have a friend who described this as a serious context of use is it is a thing. And it's, I, I mean, I'm, I'm incredibly biased towards looking at that period. Okay. But [00:54:20] Michael: I guess it's connected to what you're doing. [00:54:23] Ben: Absolutely. Is I do you know who. Yeah. So, so he actually wrote a series of memoirs and I just there reprinting it. I wrote the forward to it. So that's, [00:54:35] so I'm like, I agree with you very strongly. And it is it's. I find, I always find that fascinating because I feel like there's, there's like this. I mean, there's this paradigm that sort of got implemented after world war II, where do you think like, oh, like theory leads to applied science leads to leads to technology, but you actually see all these, these places where like, trying to do a thing makes you realize a new theory. Right. And you see similar thing with like like, like the steam engine, right? Like that's how we get thermodynamics is it's like what, like that's a great piece of work that's right, right. Yeah. So that's, I mean, like that, that absolutely plays to my biases that like, yeah, we. Like not, not doing interdisciplinary things for their own sake. Like just being like, no, like let's get these people that are rude, but like having very serious contexts of use that can like drive people having [00:55:32] Michael: problem to solve. It's not just the case [00:55:35] of kind of enjoying kind of chatting about what you each do. And then just going back to the thing you were doing before. Yeah. Feeling, feeling enriched. Yeah. But otherwise I'm changed it. It's interesting [00:55:46] Ben: though, because the incentives in that situation sort of like now fall outside of the iron rule right. Where it's like, it's like, you don't care. Like you don't care about like, I mean, I guess to some extent you could argue like the thing needs to work. And so if it works, that is evidence that your, your theory is, is [00:56:09] Michael: correct. That's true. But, you know, but I think as you're about to say, engineering is not science and it's not it's the own rule is not overseeing engineering. It's the it's engineering is about making things that work and then about producing evidence for, or against various ideas. That's just a kind of a side effect, [00:56:27] Ben: but then it can sort of like, I guess it can like spark those ideas that people then sort of like take, I [00:56:35] was like, I mean, in my head, it's all of this, like I think of what would I call like phenomena based cycles where like, there's, there's like this big, like cyclical movement where like you discover this like phenomena and then you like, can theorize it and you use that theory to then do like, I dunno, like build better microscopes, which then let you make new observations, which let you discover new phenomena. [00:57:00] Michael: It's really difficult to tell where things are going. Yeah. I think the discovery of plate tectonics is another good example of this sea, of these, all of these scientists doing things that, that certainly not looking into the possible mechanisms for continental drift, right. But instead, getting interested for their own personal reasons and doing things that don't sound very exciting, like measuring the magnet, the measuring the ways that the orientation of the magnetic field has changed over past history. By looking at the, by basically digging up bits of rock and tests, looking at the orientations of the, [00:57:35] of the iron molecules or whatever, and the lock and, you know, it's, I mean, it's not, it's not completely uninteresting, but in itself it sounds like a kind of respectable, but probably fairly dull sideline and geology. And then things like that. We're developing the ability to meet very precise measurements of the gravitational field. Those things turn out to be. Key to understanding this, this amazing fact about the way the whole planet works. Yeah. But nobody could have understood in advance that, that they would play that role. What you needed was for a whole bunch of, that's not exactly chaos, but I kind of I kind of diversity that might look almost, it might look rather wasteful. Yeah. That's very practical perspective to, to blossom. Yeah. This is, [00:58:29] Ben: I, I truly do think that like, moving forward knowledge involves like being almost like [00:58:35] irresponsible, right? Like if you had to make a decision, it's like, it's like, should we fund these people who are going in like measuring magnetic fields just for, for funsies. Right. And it's like, like, like from, from like a purely rational standpoint, it's like, no, but yeah, [00:58:51] Michael: the reason that sort of thing happens is cause a bunch of people decide they're interested in. Yeah, persuade the students to do it too. And you know, whether they could explain it to the rest of the world, actually that's another, there was also a military angle on that. I don't know if you know that, but the, the, some of the mapping of the ocean floors that was also crucial to the discovery of plate tectonics in the fifties and sixties was done by people during the war with the first sonar systems who nobody's supposed to be, you know, finding submarines or whatever, but decided, Hey, it would be kind of interesting just to turn the thing on and leave it on and sort of see what's down there. Yeah. And that's what they did. And that's how some of those first maps started being put together. [00:59:35] That's [00:59:36] Ben: actually one of the, one of my concerns about trying to do science with, with like no networks is. How many times do you see someone just go like, huh, that's funny. And like, like so far you can't like computers. Like they can sort of like find what they're setting out to find or like they have a, or they, they almost have like a very narrow window of what is considered to evidence. And perhaps like through, through your framework the, the thought of like, huh, that's funny is like you're someone's brain, all of a sudden, like take something as evidence that wasn't normally like supposed to be evidence. Right. So it's like, you're doing like one set of experiments and then you just like, notice this like completely different thing. Right. And you're like, oh, like maybe that's actually like a different piece of evidence for something completely different. And then it opens up a rabbit hole. [01:00:31] Michael: Yeah. This is another one of those cases though, with.[01:00:35] Sort of the, some kind of creative cause it, and they do think it's incredibly important that scientists not get distracted by things like this. On the other hand, it would be terrible if scientists never got distracted by things like this. And I guess I, one thing I see with the iron rule is it's is it's a kind of a social device for making scientists less distracted. Well, not putting the kind of mental fetters on that would, would make it impossible for them ever to become distracted. [01:01:05] Ben: And maybe perhaps like the, like the, the distraction and like saying, oh, that's funny. It's like the natural state of human affairs. [01:01:12] Michael: Well, I think so. I think if we, we would all be like Aristotle and it turns out it was better for science fair, actually a little bit less curious and yeah. And it's interesting and variable and we had actually our, so [01:01:24] Ben: one could almost say that like the, the iron rule, like w w would you say it's accurate that like the iron rule is absolutely. But so [01:01:35] is breaking in the sense that like, like if, if like somehow there, like you could enforce that, like every single person only obeyed it all the time science, like we, we actually, we make serendipitous discoveries. And so it's like in order to make those, you need to break the rule, but you can't have everybody running around, breaking the rule all the [01:01:57] Michael: time. All right. Put it a little bit differently. Cause I see the rule list is not so much, it's not so much a rural for life. And for thinking is for, for sort of publishing activity. So you don't, you're not, you're not technically breaking the rule when you think. Huh? That's funny. And you go off and start thinking your thoughts. You may not be moving towards. Yeah. It has the kind of scientific publication that, that satisfies the role. But nor are you breaking. The F, but if all scientists can, as it were live to the iron rule, not just in there, not just when they took themselves to be playing a game in every way that they thought about [01:02:35] they, they, they thought about the, the point of their lives as, as kind of investigators of nature. Then, I mean, that's, people are just not like that. It's hard to imagine that you could really, that would ever really happen. Although, you know, to some extent, I think our science education system does encourage it. Yeah. But if that really happened, that would probably be disastrous. We need, it's like the pinch of salt, you know, if you only want to pinch, but without it, it's not good. Yeah. That [01:03:06] Ben: seems like an excellent place to end. Thank you so much for being part of idea missions. [01:03:35]

The Remote Real Estate Investor
These 10 states have the lowest property taxes

The Remote Real Estate Investor

Play Episode Listen Later Dec 18, 2021 18:27


We recently did an episode on the 10 cheapest cities to buy property in so we wanted to follow that up with a look at property taxes across the country. We pulled up a list compiled by Business Insider on the states with the lowest property taxes. In this episode, we go through the list and comment on what this means, and point out potential shortcomings of a list like this. This episode will answer questions, but it is really a starting point of where to do your own homework on this topic. And like Michael always says, "make sure to call the local county tax assessor".  --- Transcript Before we jump into the episode, here's a quick disclaimer about our content. The Remote Real Etsate Investor podcast is for informational purposes only, and is not intended as investment advice. The views, opinions and strategies of both the hosts and the guests are their own and should not be considered as guidance from Roofstock. Make sure to always run your own numbers, make your own independent decisions and seek investment advice from licensed professionals.   Emil: Hey, everyone, welcome back for another episode of The Remote Real Estate Investor. My name is Emil Shore. And today I'm joined by Michael Albaum,   Pierre: Pierre Carrillo   Emil: And today's episode we're going to be do some similar as we did on a recent episode, which was the if you guys remember the episode 10 most affordable states to buy a home, we're actually going to be covering the top 10 states with the lowest property taxes and this will be 2021 data that we're going to go over to help you you know, as you're looking for markets looking for states invest, hopefully all this data will help you in that journey. So let's hop into this one.   Alright guys, so we are sans Tom today. But we got we got Michael and Pierre, which Dynamic Duo here. Very excited for this episode. Last time, we did some fun where I have the list in front of me. And you guys guessed, I think you each took three guesses and see if you made it in the top 10 list. So let's follow that same style. Pierre, you get to start this time. So we'll go we'll go back and forth. So Pierre, you'll go one, Michael, you'll go one and we'll just flip flop back and forth. And I will tell you guys, if that state is in the top 10 list of lowest property taxes,   Michael: Love it.   Pierre: All right.   Michael: Good luck Pierre. You're gonna need it.   Pierre: Yeah, I'm just trying to remember all the different agents we've had on over the over the last year so definitely not Texas because they don't have income tax.   Emil: That is correct.   Pierre: I'll say Alabama because that was one of the reasons we chose Alabama because…   Michael: Dirty dog   Pierre: Man was it low.   Emil: Alabama. Ding ding ding That is correct.   Michael: Nice.   Emil: Alabama is one of the top 10 Lowest property tax states good job Pierre. Alright, Michael, what you got?   Michael: All right. I'm gonna take a flier here and I'm going to go and say Tennessee is going to be in the top 10   Emil: Tennessee… Eeen. Tennessee is not in the top 10 Lowest property tech states. Sorry, Michael.   Michael: Ah, swing in a miss.   Emil: Pierre looking good, dude. All right. What you got for your second guess.   Pierre: Can Kentucky   Emil: Kentucky is not on the top 10 list. Sorry.   Pierre: Oh man.   Michael: All right.   Michael: Virginia. Show me Virginia.   Emil: Show me Virginia. EEEn. not on the list. Sorry Michael.   Pierre: Oh man we're strugglin.   Emil: Mike you're struggling. You guys did so much better on the other episode. I feel like it was you guys were doing really well on that one. Come on guys. All right Pierre.   Michael: Alabama, Arizona Arkansas, California Colorado. Remember that fifth grade project the state's project and school you have to remember every state every capital.   Emil: Yeah. Those are some…   Pierre: Oklahoma   Emil: Oklahoma final guess. Oklahoma is not on the list. Alright Michael chance to tie it here or just go down in terrible blaze   Michael: Of glory. Like a like a phoenix rise from the ashes of embarrassment. Show me Mississippi.   Emil: Ding ding ding Mississippi.   Michael: Yes. Eat it Pierre.   Emil: Redeems himself. Hold on you guys.   Pierre: Just not Jackson, Mississippi.   Emil: You guys died. Good job. One a piece. You know, you have 33% You both failed. But you both at least got one on the board.   Michael: I went to engineering school 33 is passing for sure. Passing like that's like the highest grade oftentimes.   Emil: I get it. Yeah, if it's based on a curve, you guys both pass.   Michael: Sweet. This is a list compiled by Business Insider. And again, this is for 2021.   Michael: So top 10 states with the lowest property tax. We'll start at number 10 move our way to number one, or so like this is 10th least expensive. Number one is going to be the least expensive in the country. Right? How this list works?   Emil: Yes. So counting number one will be the lowest on a percentage basis property tax. Starting with number 10 We got New Mexico at 0.55% of assessed home value.   Michael: I just gotta say already this list is garbage. Because the way homes are assessed is so different in every state. So I guess that's just something to highlight and point out is like, look to understand and every county does differently, by the way. So like understand how your county that you're interested in purchasing property calculates property taxes. So is it assessed value is it sale price, sometimes those two numbers are the same. So it's really important to go do a little bit more digging after this episode. And these 10 places can be a great place to start. But I just had to get I had to get that off my chest. Assessed value is a bunch of garbage like they two assessors for different states who like the same property, and it says it differently. So whatever that's worth.   Emil: I've been the beneficiary of this on on my triplex in Missouri, the assessed value they gave was insanely low. So I've been the beneficiary of that. But yeah.   Pierre: You're just bitter that you're a veteran that tied with a newbie here, so.   Michael: Looking for any excuse to just to claw back some knowledge, some knowledge share.   Michael: What's number nine Emil?   Emil: I'm curious, Michael, if you know this so assessed home value, is that literally the structure? Does that include land? Does it not include the value of the land? Do you know how that works?   Michael: It's usually broken down between land and building is how I've seen it.   Emil: Yep.   Michael: And then I think oftentimes, the assessed value is the sum of those two. And so you're not depreciating the land on your taxes. But I do believe that the land is still taxed, because if you just go buy raw land, I think you'll still have property taxes to pay on that. It's going to be significantly less than but that's, that's my understanding.   Emil: Okay, so that's interesting. I just really quickly looked up an article on what is the assessed value of a house. So I'm just gonna read this. This is from a website called Value penguin by lending tree. So it says officials review other relevant information such as neighboring property values and the sales history of the property to determine the assessment value. This estimate is generally made without actually inspecting the home which can lead to an inaccurate valuation, which is a testament to what you were saying, Michael. If the assessed value is higher than the fair market value, the property has most likely been over assessed by the town and the owner is probably paying too much in taxes, which is one reason you know, you can actually fight your property taxes.   The assessed value of a home usually lags in comparison to the market since the valuations are only adjusted annually. While market values can change multiple times per year, the home that has recently been resold tends to be closer to the assessed value than a home that has not sold in a long time. Depending on the area's legal restrictions. Most assessed values cannot increase more than certain percentage each year. So interesting. Okay.   Michael: And I mean, that's another question to ask your cat like local county assessor is how often is the property reassessed because there are some jurisdictions where it's like once every three years or once every regular, some kind of frequency so it's not always an annual thing?   Emil: Yep. Yeah, I remember when I was recently buying that treeplex, triplex I just mentioned in   Michael: The treeplex!   Emil: You know, what, we have a new kid at home, I'm allowed to have brain farts like that. I called the assessor and they gave me like, the Calculate the formula that they use to calculate it. So a lot of times again, if you're looking anywhere, you can call the county assessor, they'll either give you the formula, or they'll give you a breakdown of how they kind of calculate these things. But anyway, back to our list. Number nine, we got Mississippi which is 0.52% of the assessed home value. Good old Mississippi, and.   Michael: MI SSI SSI PPI.   Emil: You like geography, didn't you? You're getting geography class,   Michael: Dude. I love geography. Yeah, I really like geography. My wife and I will sometimes play the geography game where she'll you know, we'll go back and forth naming countries and you gotta name the capitals. The good fun brain brain game.   Pierre: Have you guys ever played the National Geographic board game?   Emil: No. Tell us. Oh, it's, it is awesome. So I found this at the Goodwill. The Goodwill here has an entire row of board games. So we went there. And they're like, 3.50 each. So in board games are like 50 bucks each sometimes. So anyways, this is like a game from 1986 or something. And it's anyways, you build a globe flat out. So you have a bunch of hexagons and you you build a globe, and then you answer things about markets and people, geographic or planet planet Earth and you have like four categories and you get points based on it's a real fun game. So as a geography lover, you might really enjoy that game.   Michael: I'll Check it out. And that's cool that you build the earth flat because that's how it actually is in reality, so I mean.   Emil: That's right.   Pierre: Yeah. Well, because you make it flat you can make 4 Earth's because it's like when you unpeel an orange peel, it doesn't lay perfectly flat it leaves up open surfaces. Anyways, National Geographic plug right there.   Emil: Nice. There's, there's this app I downloaded a couple years ago and it like helps you learn continent geography so it'll pull up Europe and you know, it'll have the outline of each a bunch of countries and then I'll like list 10 And you have to like tap where you think that country is. So it helps you like are there in different continents. So it's cool to alright, that's cool. Number eight.   Michael: Back on the rails.   Emil: Back on the rails number eight, we got Arkansas at the same as Mississippi 0.52% of assessed home value. So we got to a tie between Arkansas and Mississippi. Moving up the list. This is a very popular hot state for for Mark for rental property and investing right now South Carolina at 0.5% of assessed on value.   Michael: Interesting. All right. All right.   Pierre: Yeah. Interesting, because we've had both Jackson, Mississippi and Columbia, South Carolina, Columbia, South Carolina, right. Yeah. And those were both very high in taxes. So this is just kind of an average of the states. And no necessarily those metropolitan centers.   Emil: Correct.   Pierre: Or metropolitan.   Michaela: Right cause every county can do it different.   Emil: Alright, moving up the list we got I think somebody mentioned Virginia but number six on the list was West Virginia.   Michael: Ooo man. Emil: Was that you Michael?     Michael: That should totally count Yeah.   Pierre: If that counts, Kansas counts for me. I'll just the add the Ar!   Emil: On Jeopardy. What is Virginia would not be the same as what is West Virginia. Sorry, Michael.   Michael: Alright, seems reasonable.   Emil: 0.49% of assessed home value on West Virginia.   Michael: West Virginia was actually I think the number one state that was on the top 10 list of most important places to buy. That's interesting. And get a cheap house and pay very little property taxes.   Emil: There you go. Alright, moving up. We got the District of Columbia DC at 0.46% of assessed home value. Obviously, homes are very expensive there. So you're still paying a lot in terms of nominal dollars, but percentage wise on the list of top 10.   Alright, number four, Delaware, we got 0.43% of assessed value. So business friendly, right. Some people like incorporate a lot in Delaware and then looks like low property tax there as well.   Number three, this was Pierre's guess Alabama 0.33% of assessed home values. Tiny.   Michael: Nice.   Emil: Go Alabama. Number two, this one was surprising to me. Hawaii, Hawaii 0.26% of assessed home value.   Michael: What? That I guess I figure you're paying so much for the purchase. You're still giving them like you said a lot  of nominal dollars.   Emil: Exactly. And then number one, can I get a drumroll please guys?   Louisiana 0.18%. Nothing's 0.18% of assessed on value. Crazy.   Piere: Beautiful.   Michael: Makes total sense.   Emil: And that is our top 10 list of states with the lowest property tax.   Michael: We should do another episode ranking the best school districts or the best school systems in the country and see if there's any any over overlap or direct correlation or parallels we could draw between high property tax states and very good school systems since that's so much of what those dollars go to fund. That's I think, like looking at the property tax breakdown, that's often the biggest portion of the bill in terms of like dollars and percent goes to the school system.   Emil: Right. It'd be interesting, though, because again, even though you could have, like California, I think is probably the bottom third, or it's definitely in the lower group, the bottom 50% In terms of percent, I think, but just because home values are so high here, again, like just so much property tax revenue. So I wonder if it's like, you know, this percentage matter? Does it just matter of like overall dollars being pumped into the system?   Michael: That's a good question, too. So for California, it's I think it was Prop Eight, I think I'm talking.   Emil: 13   Michael: Prop 13. That's it, where you have 1% of the sale price at a minimum   Emil: Forever and then never gets reassessed.   Michael: Well, it does it goes up with time. But like your base value, your base assessed value is at 1% of the sale price. And so   Emil: I thought either prop 13 in California was like your basically your property tax never changes. I thought that was the whole thing behind prop 13 is like once it sells it's calculated that value forever. I thought that was the thing with Prop 13. Otherwise, you know, you have someone who bought a home in California 30 years ago. And now their property taxes like astronomical compared to when they bought it because their values have gone up so much.   Michael: Well, I think it goes up nominally every year like, look at your last two years of property tax payments on your house. Like it will have likely gone up a nominal amount.   Emil: Okay, yeah, you're okay. So proposition 13, declared property taxes were to be assessed by their 1976 value and restricted annual increases of the tax to an inflation factor, not 62% per year. Okay, you're right.   Pierre: And don't some areas charge more on property taxes based on whether or not you're going to be investing or whether or not you live in the property?   Emil: Yes, I have a home in Indianapolis and you pay a higher rate if you're an investor, rather than if you're a owner occupant buying that home?   Michael: Yeah, I think it's like point 2% of the assessed value versus 1% For investor versus owner occupied. So like doubles?   Emil: Yeah, I think that's right. There's a there's a exemption to in California homeowners exempt or a home homestead exemption. It's pretty, it's pretty minimal. It's pretty nominal. But in other markets, it can be pretty impactful.   Emil: Yeah.   Pierre: Do you know if any of the states that we covered on this list are subject to that?   Michael: I don't.   Pierre: Okay. So that might be something to look into. You know, you might think it's the lowest place but then you go to invest.   Emil: That's right? This is only a starting point. We're leaving our our listeners with a lot of homework.   Michael: Yeah, well, it's just I think it's such a good place to start. And especially if you go listen to the other episode and overlay. Okay, where are their affordable homes to purchase and also affordable property tax rates? Could be a new new market for you.   Pierre: If you listen to more than two episodes, you will have heard Michael say more than more than five times call your county tax assessor.   Emil: Michael “call your local county tax assessor” Albaum.   Michael: Well, it's just one of those things like people are like, Oh my god, I totally burned by the property tax. It's like well, you didn't do the one thing that you should have done. It's so easy.   Emil: Raise your hand if you fell victim to that on like your first or second property. That's me.   Michael: Yeah, see?   Pierre: I heard it. I heard it too a million times.   Emil: Well, that's when was more so like the home in Indianapolis? I didn't again I didn't call the tax assessor I just looked at okay, what is it as a percentage? And I didn't look into Oh, for an investor it's higher so it's like you know during escrow I figured all that out. All in all still fine. Indianapolis is been a solid market could appreciate all those things. But again, you know, just got to go in eyes wide open.   Michael: Yeah, it could have not been.   Emil: Exactly It could have not been. The the joys of a bull market. Make Mistakes   Michael: Still win.   Emil: Feel the impact of a lot less. Alright, thank you everyone for tuning in. Hope this was a helpful episode for you. And we will catch you all on the next one. Happy investing.   Michael: Happy investing.   Pierre: Happy investing.    

ClickAI Radio
CAIR 57: Interview - How AI Turns Your Sharing Into BUSINESS GROWTH

ClickAI Radio

Play Episode Listen Later Dec 18, 2021 36:09


In this episode, we take a look at how AI turns your sharing into business growth. Grant Okay, welcome, everybody to another episode of ClickAI radio. So I'm very excited to have here with me today ShareThis business development leader. I think it got that right. Michael Gorman, business development leader. But before I go any further, Michael, would you introduce yourself? Michael You bet. Grant. Yeah, it's great to be here. Like you said, I oversee business development, but also product and marketing at ShareThis. I've been I've been with ShareThis for a couple of years. In that role. I have a background in data, really, data and analytics has been my passion. Also media and marketing sort of themes. I've worked for big data companies like Axiom, I've worked for an email marketing leader, digital impact, they got bought by Axiom. That's how I got there. And I've also worked for big consulting firms. And for ESPN back in the earlier days of my career. Grant Oh, wow. Could you maybe give us a play by play? I bet you could write ESPN. Interesting. Wow. Michaels It was a fun period. I was like years eight through 11 of the history of of ESPN, which, so is a fun time to be there. Grant How fun. All right. And he did some some consulting roles as well. So data and analytics, huh? Yeah. Right. All throughout all throughout the career. So what led you into this work was ShareThis what was it was the journey there? Michael Well, one thing is that, that I've worked with our CO CEO on the past, at axiom, so we knew each other, but ShareThis is a really, really special data asset. In a lot of ways, and within the world of the of the advertising that I've worked in for quite a few years. It's it was well known. So when I had an opportunity to do a little consulting for them, I jumped into it. And that led to the to the role. It's a Yeah, sure this is, you know, it's Well, shall I tell you a bit about the company? Or is that? Grant Yeah, yeah. I mean, yeah, tell me a little bit about how it got started. And its purpose and sort of the vision of it. Michael You know, well, like a lot of companies, it started with one purpose and, and things evolved a little bit over time, it, it started off in the early days of social networks, when Facebook was still a new idea and mind MySpace was, was beginning to slow down, it was with the idea of making it easy for any website to make to make it easy for their users to share content to all the social networks that they might have an interest in. And so a developer with a simple, taking, you know, taking a piece of code and pasting it on their website that they could then have sharing. We and so it was one of two or three tools that really started in those early days and became a leader in the space. We actually have a how to still maintain a trademark on that little little V on the site there. Yeah, I mean, that's what you're known for. Yeah. So it's a sign if that's there, it's a sign that sharing is you know, sharing tools are present. It's essentially the balance value for the for the publisher for the owner of the site who doesn't have to does no work to have sharing available will get some analytics as a result, sharing is valuable because it makes it attracts more people to the site new users more more content. And, and so it's it's grown up naturally. And we're, you know, so really well established. But a number of business models were tried over the years, but but about five years ago, we started focusing, moving towards being 100% about our data, is that really as a special asset, we have around 3 million publishers using us sort of our live arm 3 million now, that's been pretty stable, you know, half to three quarters and in the rest of the world, a quarter in the United States, a little biased towards English language, but we have every language in the world represented among the users on the sites. And, and so that data and and we'll talk more about this when we get into things like, you know, the the technology in the AI. Yeah, but we're really just, you know, it's like a window into what, what people are what's on people's minds? What are they looking for? What are they searching about online, and we can, you know, discern trends and also, you know, make sure that advertising is more relevant for for users. Grant So I have a question for you on that. So you've, of course, are familiar with the terminology of neuromarketing, right. And, you know, as a way of sort of tracking, how are people interacting with a site, right, and where do they go? And where do they point and click and, you know, there's organizations that look at, you know, extracting what the user is doing on the site, this feels like this starts to come into that world right that day. I mean, I don't know that it's tracking every single movement, but it's tracking, obviously, the event of I want to share something. Any thoughts on that? Michael Yeah, that's really interesting. I mean, there's a lot of different ways to make inferences about about people, we tend to focus a bit more on the on the broad, the broader picture, that the thing that's that, I mean, there's, like you say, so many choices. But the thing about online content is, it's very rich. So when a person visits a site, there's a lot of things there, there's a lot of things on the page they're looking at. And so what we've really focused on is using the page as a source of clues about what a person is interested in, we also might look at the link in and out of the page, and get a clue from, say, a search term as well, that's a that's useful, and clearly when someone shares, you know, content that's that that sort of zoned in on exactly what they care about on the page. But we've opted more for the broad picture of focusing, you know, taking all that richness and attributing some probability of interest that for you, for user to the things that are on the page. And that way we can we have just such a broad, you know, broad palette to work with. And I think also from the point of view of, of, you know, user consent and user experience, it means that what we're actually collecting is is relatively light, it's just that this user was on this page at this time. And any inference we make is not based on what he or she did, or how are their eye movement, there's no no personal collection, we just have the that event, and we get all the all the power. Grant So it's when they were there. Is it anything about how they got there? Or where are they left? Michael Yeah, exactly. We do. We do use the inbound links and outbound links when we can get them. And that sometimes, as I said, yields a search term, those can that was sort of part of the of the link the part of the information that what came with the user, you know, the referring search term or so that so there's some some useful data there as well. Grant Yeah. So so when you collect this, and then that's got to be a massive repository, I think I saw somewhere else and I'm looking at, was it three terabytes of raw data and 100 million keywords in 200 languages a day? Is that right? Michael It sounds roughly right. I haven't counted it lately. But, yeah, you're right. But But yeah, we we see about half a billion, you know, unique, what we call events, something, you know, something happened at a point in time, visits a share per day. Grant This is a grounds for, you know, a playing field for AI, right, just you have so much data. So tell me what it is you learn from it with the AI, right? What kinds of problems are you looking to solve? As you and I know, when we pursue AI, we, it would tend to be better served if we're going after a particular question or thought in mind. Now, obviously, we get surprised with AHA insights from Ai. But going intentionally after something makes a lot of sense. Can you give a scenario the kinds of things that you're looking for? Michael Well, the I would say that the theme that has worked for us so far, is to try to do is to focus on being the able to represent and reflect human interest, what are people interested in? And yeah, and so. So we, we use, and I guess where the AI comes in is that we use the latest techniques of language analysis and language modeling. So we capture all of the linguistic content on the page and then we represent it in a number of ways. What are all the prominent keywords? What are the what are the entities that are you know more that are Unusual, you know, a brand name, a celebrity name, a business name? What are the what is this page about the concept? Or what are? What are some of the concepts that accurately describe what this page is about. And then we have some standard categorization techniques are basically a taxonomy of topic interest topics that we we screen for, you know, and and it's not, it's not a yes, one of the nice things about this is it's not a, a, it's not a, it, we don't have to decide one thing, you know, we were able to say, all of the prominent keywords, and all of the interesting entities and several concepts and all the categories that this page is about. So it could be a page, it's about, you know, mountain climbing and and what shall we say? And Utah, and the, or the American West and, and road vehicles? And, you know, and beverages, you know, skiing or whatever? Right, right. Exactly. Grant Yeah, so some form of an ontology there, right, that allows you to sort of connect these together? Michael Yeah, we used a number of techniques that you said, One is, we built a custom ontology, using relative and you know, we're, we're not a huge company. So we, we try to wherever we can do something open source or free as the entry point we do that. And so we, we use some Wikipedia, it's slash DBPedia is a source for us. And, as is some Google free offerings that help us sort of the provide the raw material for building our customer ontology. We've also take great advantage of some of the latest open source language modeling tools. One is when it goes by the name of the Google released one, I forget what the what the acronym stands for, but one that's called Bert, and then more recently, one that's called Muse. Yeah, we use muse. Okay, that, that allows us to represent anything, either a word or a sentence, or the whole page as a as a set as a vector of 500 numbers. And if two pages have the same values for those 500 vectors, then they are about the same thing. Yeah, you got you have some affinity there right now, even though in practice, they might be in different languages use totally different, you know, different sets of words, but they're still about the same thing. That's, that's, that's really, for us that technology has been a real breakthrough. Because it's we've been sometimes keywords and can be very, you know, they can be false positives or No, yeah, negative. Grant I mean, there, yeah, there's nothing that governs some, you know, webpage designer to, you know, say, hey, are they using the actual right keywords? Right? Michael Yes, or even? Or even? How do you a lot of words have multiple meanings? How do you disambiguate to get the right one? Yeah. So this this, embedding technology, this Muse model helps us do that. And then Facebook is given we use a tool, they think it's called Facebook. Ai similarity search. Yeah. And both of these are open source tools, y'all you have to put in the effort and have the knowledgeable people to master their use. And that allows us because great, it's great that you've now got all these numbers you can compare, but that's a lot of numbers. That's you half a billion a day, you know, and we have we see 600 million unique pages every month. So so how do I great, I want to rank the 600 million pages to see which ones are most about skiing in Utah. Yeah, that's, you know, how do I do that quickly, and then and affordably? So fate, the Facebook tool helps us a lot with that. Grant So let me ask you a question that So so far, you've been talking about leveraging AI technologies to help you get your arms around that sheer volume of data on a daily basis and to try to extract some meaning and semantics and understanding from it. That's a good point that's on the side of ShareThis and the benefits to ShareThis. What about it from pivoted to the other side? What does it mean to it is, you know, I talk a lot with small medium organizations, how does that benefit them? What takeaways or values come over to help them through something like that? Michael Well, what the I mean, the industry that we started with, is was is advertising and programmatic online advertising as a place where we make our solution available. And so we were at this point, probably the leading source of the ability to target ads based on interest. So if if A small business were doing online display advertising and they went to Google's, if they use Google's platform or trade desk, or any of the major platforms, and they searched on, I want to find people interested in skiing in Utah, our data would be one of their choices to find that. And so it's designed to provide a broad set of individuals who in the last 30 days have shown some interest in that topic. And it could be, you know, it might be at the level of skiing, and they might, then they might, but but the nice thing about it is that we we've, I mean, it's hard, this is harder for the stats, that's what's available for the smaller business. That's, it's, it's right off the shelf, you can, you can use $1 worth or $10 worth or $100 worth if it works for you. But then on the big company side, we use some of those tools I talked about for is, well, what if, what if we don't actually have ski in Utah, we just have skiing, right? Well, we well, for an advertiser can can say, well, I need to skiing in Utah. In fact, I need to, you know, skiing in snow. But what is the alter? You know, we can create a segment using keywords and, and topics that is just about that is exactly what they need. Grant So if I were to look at maybe an advertising opportunity, leveraging, you know, this great insight that you have, does it allow me to target specific demographics, specific locations or locales? So like, you know, you're able to? Michael Absolutely, it's pretty much anything you could, I mean, because every kind of website needs sharing, we have our, our customer base, our base of publishers use our tool is pretty representative of the internet as a whole. And so if your interest is travel, we've got sites that are about, you know, traveling Las Vegas, traveling to Europe traveling to do outdoor activities, if you're interested in financial products, we can we can find things, you know, content that relates to whatever be at a mortgage or or FinTech to know. And we we represent those in about 1500 standard audiences that we distribute every day. And every day, the nice thing about our data, compared to a lot of datasets is we refresh it every day. Yeah, Michael I mean, it's every second, right? I mean, yeah, it could be, you know, people talk about real time, and we were always looking for people who've got a real time use case. But yeah, at this point, the the most frequently we refresh for a client, the customer is up by a by his hourly. Grant Oh, it's hourly, okay, that's, that's still really up to date. Yeah. I mean, if you had hourly insights on what the what's in the mind of people are the consumers that's really fresh data? Michael Yeah, yes. Yeah. Yeah, one of the areas that we that we are moving towards is trying to go beyond advertising and inform other activities like demand forecasting, you know, how much should we order for a store in a given location? Well, our data about how much interest is being shown on the products of that store, and in that store, in that area, we can sort that way, and provide that as an input. Grant That makes that makes a lot of sense. You know, there's, there's some retail organizations I've worked with with AI. And obviously, it always comes back to or not always, but most of it comes back to the supply chain, right, getting further and further left in terms of their their demand forecasting. And if they were able to understand you know, where that interest lies, it does almost gets to, oh, I know, this is a stretch in terms of language, but it's kind of a sentiment analysis, a play on that. Right. It's the ability Yeah, the ability to say I understand what the sentiment is in terms of where their interests are. And if I understood what that was, in terms of particular set of products or other things I'm offering, and I could get that further into my, into my supply chain, that would be really valuable to Yeah, Michael I mean, it's nice that you mentioned that we do we do actually score the sentiment of the content on the page. So we're sentiment is useful, either to only talk to the people who are in favor or opposed or the middle, we can we can build an audience that or provide that as a data element as well. Grant Yes. See, that's that's powerful to understand the the sentiment of the page itself, even how people are talking about it, or what they're doing, have you ever ran into the ability to use it in terms of IP tracking, right. So in other words, if there is an organization that had a certain set of IP and, and and really, yeah, they felt like oh, my IP, I've lost control my intellectual property, it's showing up in other places. Michael Oh, that's interesting. You know, I was thinking of I was thinking of the I the the IP address the Internet Protocol address. Yeah. Should have been more clear. Yeah, I'd love to answer that question. But that wasn't what you were asking. Well, yeah, answer. Oh, we'll start with intellectual property. Yeah. One sec. Regarding intellectual property? You know, we have it. Let me think about that. Let me give you the scenario. I had, one of the things I've thought about that we haven't taken on it, you know, is that is, is using using intellectual property as a data set? Yeah. If if we were to, to read to do the same kind of analysis I talked about earlier on trademarks. Yeah, it could mean be the means for discovering which, what sites were about branded products by seeing the correspondence between the trademark and the, because that's always you run into difficult How do you tell something's a brand? When is Jaguar a brand? You know? Exactly. Grant Yeah. Yeah, it's a fascinating problem. I had a company reach out to me and say, Hey, can you develop something in this area, and we did some work on that. I called it smart catch, but they were looking to protect their IP, their intellectual property, which was, we've got this corpus of information. And, and we've got others that are, you know, getting access to it and are promoting it, you know, elsewhere out into the, you know, online universe there, or metaverse. And, and I want to be able to discover, you know, when it's opportunistic, and you can use, you know, SERP and other technologies to try to find some of that stuff and do lots of scraping. But that's got its own challenges in terms of a solution. And where you've got this opportunity to listen. Right, right, to observe what people are sharing and to the to compare that against a corpus of protected material, right? Michael Kind of an intro you're giving, you're giving me a product idea. Seriously, one of the things that we've done this year, is to create what we what we call, you know, similarity scoring. So similarity, and that's gonna cause Yeah, you can literally give someone who was curious about the dispersing dispersion of intellectual property, give us a domain. Yep. And, or a, you know, the piece of content that describe their, their stuff, and we would rank our sites for which ones had it most. Right. And, you know, whatever the top 100, you know, and you know. Grant What I found interesting on that, when I built the initial piece on that was that I found that, in some of the discovery, in some cases, what I found was a foe. And in other cases, it was a friend. Exactly right. That, you know, okay, just because I found it doesn't mean it's an enemy. But, but it might be, and so you want to then notify them? Is this? Is this someone that's an ally or not? Anyway, interesting thought? Michael Because I think I think that sometimes there is a, you know, I don't know, there's a presumption that fraud detection or a bad actor detection is, is, you know, worth more, etc. But I do find that in a lot of cases, the pro cases are actually, you know, sometimes you just by suppressing something, you do more yourself more harm than good. Yeah. Yeah. Right. Right. That's another I wanted to touch on the other meaning of it. Yeah. Yeah. Now IP address. Yeah, yeah. So So an IP address is one of the four or five things that we capture for each case. And there's a lot that you can tell from an IP address, like, it can be translated into a location of origin, we approximate we resolve that to within half a mile. So that it's still relatively privacy compliant, and you know, not too revealing, but it certainly helps understand, you organize the data by where it's coming from example. And so the one use that is, has been an important one for us is business to business. So we, we have a number of the major companies that are in the business to business world license our data as one source where they're able to see people from a from an intellect Internet Protocol address that is owned by or been associated with a particular company. Oh, and then see what sites that that IP address is showing interest in? Oh, it just can be. Yeah, so it can be a signal that oh, it seems like you know, Chevron is interested in a new CRM system because they're you know, there's there's a big spike in that kind of traffic Awesome. Yeah, that's awesome. Yeah. Talk about so almost like a lead management. Yeah, solution for sure. That's, that's powerful. Yeah, to do that. that. Oh, there. Yeah. And that's yeah. And IP in general, I think the location implications are a really well, it's how I can, how we can do that demand forecasting I mentioned earlier, it's about looking at the origin of the data. Grant So some of the AI solutions that I've built take into consider location. So So in other words, okay, but in what I've been doing is more around, oh, some transaction occurred? Where was that transaction initiated? From? Oh, this, you know, here's the IP address. Okay, I know that where they are on the planet. Now, tell me what the context of what's taking place in you know, at that location? What is what's the weather like, right, what are other events that are taking place in that location? And then then use an AI to help draw inferences on, you know, to what degree are those factors affecting it? It sounds like you might be doing some similar things with that Michael I well, I think we could be a great contributor to any solution that was along those lines. I was adding that dimension of what are people looking at? What are people interacting? What topics? Are people in this location more engaged by then people in general, fascinating those comparisons? Grant Yeah, it's fascinating is okay. Very good. All right. So let me ask you on. Okay, so we've gone from the the big corpus of what you're collecting on a daily basis, or hourly, actually, hour by hour. And then we talked about the impact to, you know, maybe businesses organizations, when when is there a particular case or outcome that you feel like you could talk about some specific example where some organization used the advertising from that? What you did, and it had this sort of impact or effect on them? Do you have any sort of case study like that? Well, it's, Michael I guess that some of the ones that are coming to mind, I think, I mean, there's some of it's very straightforward. Yeah. An advertiser, like Western Union, is looking for people who want to make payments, you know, at a distance, I mean, wire wire transfers and payments, and we offer people showing interest in wire transfer, so that the simple act of being able to get your message in front of people who have recently shown interest in it is the is the, you know, it just doesn't need no explanation. We've taken that though, one of the things we did this year that I'm proud of is we were inspired by some of the events of last summer, to get more try to take a more active role and figure out what our data was good for. Beyond commercially, and, and we ended up creating a data for good part new part of our taxonomy, we call data for good. And so people interested in social justice loving people entered interested in veterans issues people wanted in. And so and those those segments, you know, have gotten are getting a growing amount of usage by advertisers who either, you know, wanting to demonstrate their commitment to the court to a cause, like, or to find or teachers or to, you know, communicate, right people who have concerns of that kind. So that's been one. Yeah. Another kind of it's, it's not in the mainstream of what we do. But we've, I think this data could be really great as a as a resource for educational institutions. So we've actually a major business school has has is testing I've taken a take taken a subsidiary six months of our data, and they're looking at using it in a project that they have to investigate unemployment. So fascinating. How could you How could you see earlier unemployment trends in a in a location or region that could help the for the process of forecasting the unemployment rate, and it sort of feed into it? Because I've, what I've, I think that lots of people govern organizations included, are somewhat frustrated by the fact that, you know, traditional means of forecasting that were invented before there were personal computers or barely work computers. Take a long time, you get to find out that 40 days after the month, what happened in the month, I love both data can be used to generate that much more quickly. Grant Yeah, Michael, that's I love how you're bringing that up. It seems like it has both the opportunities for not only the capitalistic aspects, but the altruistic aspects of this, the values and benefits that can help society and be pulled out of that. I think that's awesome. So all right. I've thrown a lot of questions at you. So let me ask you this, if you will. To direct direct my listeners to where to go to learn more, where would you send them? Michael Well, I would, I would love them to visit our site, because and in particular to, you know, to ShareThis.com, look, look at our news and our, our blogs, we we basically we publish both as you know, as a demonstration of our the value of our data. And and it's just a general service, we publish a lot of educational and informative information about trends in the economy, and, and public interest generally about how to do marketing well about trends in data. So so we we, we try to be a resource for people and I love I'd love people to visit that content, sometimes. Some of the best stuff is is not on on the nightly news. It's like putting some of it out. I could also you know, I can give you some examples. It would be fun. I go right ahead. Knowing that knowing this audience I we are getting a sense of who maybe was listening is interested in the show, I asked our team to identify some current trends. Yeah, I guess as we come to the end of 2021. Yeah. And so so we put these together. So what one is that, that, that while the world isn't, we're seeing the trend of the gradual resumption of events in person events, even though COVID continues to cycle up and down against the backdrop of COVID. So as of August, for example, 77% of advertised events were in person events, there was a period where, you know, year and a half ago, there was there, they basically no almost having anything, it was just shut down. It was virtual or nothing. That's interesting. So as we adapt, we are adapting. And so as you as you think about should I make plans for a virtual vet, should I invest in advertise? Should I invest in participating in virtual event? Yep, don't count them out. Even if you're nervous, you know, they, they're coming back steadily. Another thing, pattern we observed in finance, that again, you know, COVID is inevitably one of the backdrops to what any of us are thinking about, but people are continuing to be engaged with saving money. So, it so as you think about what, oh, you know, what is what's going on in the in the economy? As the, as virus uptake increases, as one of the things to extract is, is increased saving? And so if that's a, again, depending on your business, how that factors in if savings is your business? Yeah. When your could be good, good to you. If if, and then let's see, what's another one? Let's see. You know, we've heard a lot about supply chain issues. And you know, what, but what, if your retailer what a consumers most worried about? When and so the top concern is shortages and out of stock, and 51% a second costs, inflation and rising prices at 28%. And then staffing issues like worker shortages and strikes, 14, and last last of all shipping delays. So it's thinking about communication strategies, what's on people's minds that might make them not come to the store? That sort of thing? So I'm not surprised. Yeah, yeah. So and we're, we're putting out new new stuff of this kind every, every month in the blog. And and I firstly, look, I think we did we have Superbowl trends out, as of yesterday, I think. Grant So it's already started to build right. That's right. That's, that's amazing. So So you gather it on an hourly basis, and then you do the AI on it Michael Truthfully, truthfully, Grant, it's being gathered continuously. Okay, that's, that's what I thought, yeah, I thought we built we build it as it happens, okay. We literally, you know, record a record for each thing. That's, that's, that's filled out all the way with all the data that will that will need eventually. And then once an hour, we some or as we frequently as our we'll sum it up into a distribution and push it to someone but the most people get their get their data delivered overnight. Amazing. It's picking it up on their AWS bucket. Like Well, this is Grant Fascinating. Any final comments as we wrap up here? Michael Well, you know, I guess that I hope I've given you a sense of the I mean, AI is critical to our business. We are you know, we When we started on this track, we were about a 50 person company, we're approaching 100 person company. And so you don't have to be, you know, IBM to use AI AI to build a great business. So it's a combination of finding the right tools and a core of of talent, the right kind of talented people, and you can and and then, frankly, sustained effort over a period of years and you can build a business that is really hard to replicate, without without it, so very hard. Right. That's, that's my thought. That's, that's Grant Wonderful. Well, Michael, thank you so much for taking your time today. I appreciate you sharing your insights and guidance with us today, everyone. Thanks for joining another episode of ClickAI Radio and until next time, go get some ShareThis.com. Thank you for joining Grant on ClickAI Radio. Don't forget to subscribe and leave feedback. And remember to download your free ebook, visit ClickAIRadio.com now.  

Financial Investing Radio
FIR 138: Interview - How AI Turns Your Sharing Into BUSINESS GROWTH

Financial Investing Radio

Play Episode Listen Later Dec 18, 2021 36:09


In this episode, we take a look at how AI turns your sharing into business growth. Grant Okay, welcome, everybody to another episode of ClickAI radio. So I'm very excited to have here with me today ShareThis business development leader. I think it got that right. Michael Gorman, business development leader. But before I go any further, Michael, would you introduce yourself? Michael You bet. Grant. Yeah, it's great to be here. Like you said, I oversee business development, but also product and marketing at ShareThis. I've been I've been with ShareThis for a couple of years. In that role. I have a background in data, really, data and analytics has been my passion. Also media and marketing sort of themes. I've worked for big data companies like Axiom, I've worked for an email marketing leader, digital impact, they got bought by Axiom. That's how I got there. And I've also worked for big consulting firms. And for ESPN back in the earlier days of my career. Grant Oh, wow. Could you maybe give us a play by play? I bet you could write ESPN. Interesting. Wow. Michaels It was a fun period. I was like years eight through 11 of the history of of ESPN, which, so is a fun time to be there. Grant How fun. All right. And he did some some consulting roles as well. So data and analytics, huh? Yeah. Right. All throughout all throughout the career. So what led you into this work was ShareThis what was it was the journey there? Michael Well, one thing is that, that I've worked with our CO CEO on the past, at axiom, so we knew each other, but ShareThis is a really, really special data asset. In a lot of ways, and within the world of the of the advertising that I've worked in for quite a few years. It's it was well known. So when I had an opportunity to do a little consulting for them, I jumped into it. And that led to the to the role. It's a Yeah, sure this is, you know, it's Well, shall I tell you a bit about the company? Or is that? Grant Yeah, yeah. I mean, yeah, tell me a little bit about how it got started. And its purpose and sort of the vision of it. Michael You know, well, like a lot of companies, it started with one purpose and, and things evolved a little bit over time, it, it started off in the early days of social networks, when Facebook was still a new idea and mind MySpace was, was beginning to slow down, it was with the idea of making it easy for any website to make to make it easy for their users to share content to all the social networks that they might have an interest in. And so a developer with a simple, taking, you know, taking a piece of code and pasting it on their website that they could then have sharing. We and so it was one of two or three tools that really started in those early days and became a leader in the space. We actually have a how to still maintain a trademark on that little little V on the site there. Yeah, I mean, that's what you're known for. Yeah. So it's a sign if that's there, it's a sign that sharing is you know, sharing tools are present. It's essentially the balance value for the for the publisher for the owner of the site who doesn't have to does no work to have sharing available will get some analytics as a result, sharing is valuable because it makes it attracts more people to the site new users more more content. And, and so it's it's grown up naturally. And we're, you know, so really well established. But a number of business models were tried over the years, but but about five years ago, we started focusing, moving towards being 100% about our data, is that really as a special asset, we have around 3 million publishers using us sort of our live arm 3 million now, that's been pretty stable, you know, half to three quarters and in the rest of the world, a quarter in the United States, a little biased towards English language, but we have every language in the world represented among the users on the sites. And, and so that data and and we'll talk more about this when we get into things like, you know, the the technology in the AI. Yeah, but we're really just, you know, it's like a window into what, what people are what's on people's minds? What are they looking for? What are they searching about online, and we can, you know, discern trends and also, you know, make sure that advertising is more relevant for for users. Grant So I have a question for you on that. So you've, of course, are familiar with the terminology of neuromarketing, right. And, you know, as a way of sort of tracking, how are people interacting with a site, right, and where do they go? And where do they point and click and, you know, there's organizations that look at, you know, extracting what the user is doing on the site, this feels like this starts to come into that world right that day. I mean, I don't know that it's tracking every single movement, but it's tracking, obviously, the event of I want to share something. Any thoughts on that? Michael Yeah, that's really interesting. I mean, there's a lot of different ways to make inferences about about people, we tend to focus a bit more on the on the broad, the broader picture, that the thing that's that, I mean, there's, like you say, so many choices. But the thing about online content is, it's very rich. So when a person visits a site, there's a lot of things there, there's a lot of things on the page they're looking at. And so what we've really focused on is using the page as a source of clues about what a person is interested in, we also might look at the link in and out of the page, and get a clue from, say, a search term as well, that's a that's useful, and clearly when someone shares, you know, content that's that that sort of zoned in on exactly what they care about on the page. But we've opted more for the broad picture of focusing, you know, taking all that richness and attributing some probability of interest that for you, for user to the things that are on the page. And that way we can we have just such a broad, you know, broad palette to work with. And I think also from the point of view of, of, you know, user consent and user experience, it means that what we're actually collecting is is relatively light, it's just that this user was on this page at this time. And any inference we make is not based on what he or she did, or how are their eye movement, there's no no personal collection, we just have the that event, and we get all the all the power. Grant So it's when they were there. Is it anything about how they got there? Or where are they left? Michael Yeah, exactly. We do. We do use the inbound links and outbound links when we can get them. And that sometimes, as I said, yields a search term, those can that was sort of part of the of the link the part of the information that what came with the user, you know, the referring search term or so that so there's some some useful data there as well. Grant Yeah. So so when you collect this, and then that's got to be a massive repository, I think I saw somewhere else and I'm looking at, was it three terabytes of raw data and 100 million keywords in 200 languages a day? Is that right? Michael It sounds roughly right. I haven't counted it lately. But, yeah, you're right. But But yeah, we we see about half a billion, you know, unique, what we call events, something, you know, something happened at a point in time, visits a share per day. Grant This is a grounds for, you know, a playing field for AI, right, just you have so much data. So tell me what it is you learn from it with the AI, right? What kinds of problems are you looking to solve? As you and I know, when we pursue AI, we, it would tend to be better served if we're going after a particular question or thought in mind. Now, obviously, we get surprised with AHA insights from Ai. But going intentionally after something makes a lot of sense. Can you give a scenario the kinds of things that you're looking for? Michael Well, the I would say that the theme that has worked for us so far, is to try to do is to focus on being the able to represent and reflect human interest, what are people interested in? And yeah, and so. So we, we use, and I guess where the AI comes in is that we use the latest techniques of language analysis and language modeling. So we capture all of the linguistic content on the page and then we represent it in a number of ways. What are all the prominent keywords? What are the what are the entities that are you know more that are Unusual, you know, a brand name, a celebrity name, a business name? What are the what is this page about the concept? Or what are? What are some of the concepts that accurately describe what this page is about. And then we have some standard categorization techniques are basically a taxonomy of topic interest topics that we we screen for, you know, and and it's not, it's not a yes, one of the nice things about this is it's not a, a, it's not a, it, we don't have to decide one thing, you know, we were able to say, all of the prominent keywords, and all of the interesting entities and several concepts and all the categories that this page is about. So it could be a page, it's about, you know, mountain climbing and and what shall we say? And Utah, and the, or the American West and, and road vehicles? And, you know, and beverages, you know, skiing or whatever? Right, right. Exactly. Grant Yeah, so some form of an ontology there, right, that allows you to sort of connect these together? Michael Yeah, we used a number of techniques that you said, One is, we built a custom ontology, using relative and you know, we're, we're not a huge company. So we, we try to wherever we can do something open source or free as the entry point we do that. And so we, we use some Wikipedia, it's slash DBPedia is a source for us. And, as is some Google free offerings that help us sort of the provide the raw material for building our customer ontology. We've also take great advantage of some of the latest open source language modeling tools. One is when it goes by the name of the Google released one, I forget what the what the acronym stands for, but one that's called Bert, and then more recently, one that's called Muse. Yeah, we use muse. Okay, that, that allows us to represent anything, either a word or a sentence, or the whole page as a as a set as a vector of 500 numbers. And if two pages have the same values for those 500 vectors, then they are about the same thing. Yeah, you got you have some affinity there right now, even though in practice, they might be in different languages use totally different, you know, different sets of words, but they're still about the same thing. That's, that's, that's really, for us that technology has been a real breakthrough. Because it's we've been sometimes keywords and can be very, you know, they can be false positives or No, yeah, negative. Grant I mean, there, yeah, there's nothing that governs some, you know, webpage designer to, you know, say, hey, are they using the actual right keywords? Right? Michael Yes, or even? Or even? How do you a lot of words have multiple meanings? How do you disambiguate to get the right one? Yeah. So this this, embedding technology, this Muse model helps us do that. And then Facebook is given we use a tool, they think it's called Facebook. Ai similarity search. Yeah. And both of these are open source tools, y'all you have to put in the effort and have the knowledgeable people to master their use. And that allows us because great, it's great that you've now got all these numbers you can compare, but that's a lot of numbers. That's you half a billion a day, you know, and we have we see 600 million unique pages every month. So so how do I great, I want to rank the 600 million pages to see which ones are most about skiing in Utah. Yeah, that's, you know, how do I do that quickly, and then and affordably? So fate, the Facebook tool helps us a lot with that. Grant So let me ask you a question that So so far, you've been talking about leveraging AI technologies to help you get your arms around that sheer volume of data on a daily basis and to try to extract some meaning and semantics and understanding from it. That's a good point that's on the side of ShareThis and the benefits to ShareThis. What about it from pivoted to the other side? What does it mean to it is, you know, I talk a lot with small medium organizations, how does that benefit them? What takeaways or values come over to help them through something like that? Michael Well, what the I mean, the industry that we started with, is was is advertising and programmatic online advertising as a place where we make our solution available. And so we were at this point, probably the leading source of the ability to target ads based on interest. So if if A small business were doing online display advertising and they went to Google's, if they use Google's platform or trade desk, or any of the major platforms, and they searched on, I want to find people interested in skiing in Utah, our data would be one of their choices to find that. And so it's designed to provide a broad set of individuals who in the last 30 days have shown some interest in that topic. And it could be, you know, it might be at the level of skiing, and they might, then they might, but but the nice thing about it is that we we've, I mean, it's hard, this is harder for the stats, that's what's available for the smaller business. That's, it's, it's right off the shelf, you can, you can use $1 worth or $10 worth or $100 worth if it works for you. But then on the big company side, we use some of those tools I talked about for is, well, what if, what if we don't actually have ski in Utah, we just have skiing, right? Well, we well, for an advertiser can can say, well, I need to skiing in Utah. In fact, I need to, you know, skiing in snow. But what is the alter? You know, we can create a segment using keywords and, and topics that is just about that is exactly what they need. Grant So if I were to look at maybe an advertising opportunity, leveraging, you know, this great insight that you have, does it allow me to target specific demographics, specific locations or locales? So like, you know, you're able to? Michael Absolutely, it's pretty much anything you could, I mean, because every kind of website needs sharing, we have our, our customer base, our base of publishers use our tool is pretty representative of the internet as a whole. And so if your interest is travel, we've got sites that are about, you know, traveling Las Vegas, traveling to Europe traveling to do outdoor activities, if you're interested in financial products, we can we can find things, you know, content that relates to whatever be at a mortgage or or FinTech to know. And we we represent those in about 1500 standard audiences that we distribute every day. And every day, the nice thing about our data, compared to a lot of datasets is we refresh it every day. Yeah, Michael I mean, it's every second, right? I mean, yeah, it could be, you know, people talk about real time, and we were always looking for people who've got a real time use case. But yeah, at this point, the the most frequently we refresh for a client, the customer is up by a by his hourly. Grant Oh, it's hourly, okay, that's, that's still really up to date. Yeah. I mean, if you had hourly insights on what the what's in the mind of people are the consumers that's really fresh data? Michael Yeah, yes. Yeah. Yeah, one of the areas that we that we are moving towards is trying to go beyond advertising and inform other activities like demand forecasting, you know, how much should we order for a store in a given location? Well, our data about how much interest is being shown on the products of that store, and in that store, in that area, we can sort that way, and provide that as an input. Grant That makes that makes a lot of sense. You know, there's, there's some retail organizations I've worked with with AI. And obviously, it always comes back to or not always, but most of it comes back to the supply chain, right, getting further and further left in terms of their their demand forecasting. And if they were able to understand you know, where that interest lies, it does almost gets to, oh, I know, this is a stretch in terms of language, but it's kind of a sentiment analysis, a play on that. Right. It's the ability Yeah, the ability to say I understand what the sentiment is in terms of where their interests are. And if I understood what that was, in terms of particular set of products or other things I'm offering, and I could get that further into my, into my supply chain, that would be really valuable to Yeah, Michael I mean, it's nice that you mentioned that we do we do actually score the sentiment of the content on the page. So we're sentiment is useful, either to only talk to the people who are in favor or opposed or the middle, we can we can build an audience that or provide that as a data element as well. Grant Yes. See, that's that's powerful to understand the the sentiment of the page itself, even how people are talking about it, or what they're doing, have you ever ran into the ability to use it in terms of IP tracking, right. So in other words, if there is an organization that had a certain set of IP and, and and really, yeah, they felt like oh, my IP, I've lost control my intellectual property, it's showing up in other places. Michael Oh, that's interesting. You know, I was thinking of I was thinking of the I the the IP address the Internet Protocol address. Yeah. Should have been more clear. Yeah, I'd love to answer that question. But that wasn't what you were asking. Well, yeah, answer. Oh, we'll start with intellectual property. Yeah. One sec. Regarding intellectual property? You know, we have it. Let me think about that. Let me give you the scenario. I had, one of the things I've thought about that we haven't taken on it, you know, is that is, is using using intellectual property as a data set? Yeah. If if we were to, to read to do the same kind of analysis I talked about earlier on trademarks. Yeah, it could mean be the means for discovering which, what sites were about branded products by seeing the correspondence between the trademark and the, because that's always you run into difficult How do you tell something's a brand? When is Jaguar a brand? You know? Exactly. Grant Yeah. Yeah, it's a fascinating problem. I had a company reach out to me and say, Hey, can you develop something in this area, and we did some work on that. I called it smart catch, but they were looking to protect their IP, their intellectual property, which was, we've got this corpus of information. And, and we've got others that are, you know, getting access to it and are promoting it, you know, elsewhere out into the, you know, online universe there, or metaverse. And, and I want to be able to discover, you know, when it's opportunistic, and you can use, you know, SERP and other technologies to try to find some of that stuff and do lots of scraping. But that's got its own challenges in terms of a solution. And where you've got this opportunity to listen. Right, right, to observe what people are sharing and to the to compare that against a corpus of protected material, right? Michael Kind of an intro you're giving, you're giving me a product idea. Seriously, one of the things that we've done this year, is to create what we what we call, you know, similarity scoring. So similarity, and that's gonna cause Yeah, you can literally give someone who was curious about the dispersing dispersion of intellectual property, give us a domain. Yep. And, or a, you know, the piece of content that describe their, their stuff, and we would rank our sites for which ones had it most. Right. And, you know, whatever the top 100, you know, and you know. Grant What I found interesting on that, when I built the initial piece on that was that I found that, in some of the discovery, in some cases, what I found was a foe. And in other cases, it was a friend. Exactly right. That, you know, okay, just because I found it doesn't mean it's an enemy. But, but it might be, and so you want to then notify them? Is this? Is this someone that's an ally or not? Anyway, interesting thought? Michael Because I think I think that sometimes there is a, you know, I don't know, there's a presumption that fraud detection or a bad actor detection is, is, you know, worth more, etc. But I do find that in a lot of cases, the pro cases are actually, you know, sometimes you just by suppressing something, you do more yourself more harm than good. Yeah. Yeah. Right. Right. That's another I wanted to touch on the other meaning of it. Yeah. Yeah. Now IP address. Yeah, yeah. So So an IP address is one of the four or five things that we capture for each case. And there's a lot that you can tell from an IP address, like, it can be translated into a location of origin, we approximate we resolve that to within half a mile. So that it's still relatively privacy compliant, and you know, not too revealing, but it certainly helps understand, you organize the data by where it's coming from example. And so the one use that is, has been an important one for us is business to business. So we, we have a number of the major companies that are in the business to business world license our data as one source where they're able to see people from a from an intellect Internet Protocol address that is owned by or been associated with a particular company. Oh, and then see what sites that that IP address is showing interest in? Oh, it just can be. Yeah, so it can be a signal that oh, it seems like you know, Chevron is interested in a new CRM system because they're you know, there's there's a big spike in that kind of traffic Awesome. Yeah, that's awesome. Yeah. Talk about so almost like a lead management. Yeah, solution for sure. That's, that's powerful. Yeah, to do that. that. Oh, there. Yeah. And that's yeah. And IP in general, I think the location implications are a really well, it's how I can, how we can do that demand forecasting I mentioned earlier, it's about looking at the origin of the data. Grant So some of the AI solutions that I've built take into consider location. So So in other words, okay, but in what I've been doing is more around, oh, some transaction occurred? Where was that transaction initiated? From? Oh, this, you know, here's the IP address. Okay, I know that where they are on the planet. Now, tell me what the context of what's taking place in you know, at that location? What is what's the weather like, right, what are other events that are taking place in that location? And then then use an AI to help draw inferences on, you know, to what degree are those factors affecting it? It sounds like you might be doing some similar things with that Michael I well, I think we could be a great contributor to any solution that was along those lines. I was adding that dimension of what are people looking at? What are people interacting? What topics? Are people in this location more engaged by then people in general, fascinating those comparisons? Grant Yeah, it's fascinating is okay. Very good. All right. So let me ask you on. Okay, so we've gone from the the big corpus of what you're collecting on a daily basis, or hourly, actually, hour by hour. And then we talked about the impact to, you know, maybe businesses organizations, when when is there a particular case or outcome that you feel like you could talk about some specific example where some organization used the advertising from that? What you did, and it had this sort of impact or effect on them? Do you have any sort of case study like that? Well, it's, Michael I guess that some of the ones that are coming to mind, I think, I mean, there's some of it's very straightforward. Yeah. An advertiser, like Western Union, is looking for people who want to make payments, you know, at a distance, I mean, wire wire transfers and payments, and we offer people showing interest in wire transfer, so that the simple act of being able to get your message in front of people who have recently shown interest in it is the is the, you know, it just doesn't need no explanation. We've taken that though, one of the things we did this year that I'm proud of is we were inspired by some of the events of last summer, to get more try to take a more active role and figure out what our data was good for. Beyond commercially, and, and we ended up creating a data for good part new part of our taxonomy, we call data for good. And so people interested in social justice loving people entered interested in veterans issues people wanted in. And so and those those segments, you know, have gotten are getting a growing amount of usage by advertisers who either, you know, wanting to demonstrate their commitment to the court to a cause, like, or to find or teachers or to, you know, communicate, right people who have concerns of that kind. So that's been one. Yeah. Another kind of it's, it's not in the mainstream of what we do. But we've, I think this data could be really great as a as a resource for educational institutions. So we've actually a major business school has has is testing I've taken a take taken a subsidiary six months of our data, and they're looking at using it in a project that they have to investigate unemployment. So fascinating. How could you How could you see earlier unemployment trends in a in a location or region that could help the for the process of forecasting the unemployment rate, and it sort of feed into it? Because I've, what I've, I think that lots of people govern organizations included, are somewhat frustrated by the fact that, you know, traditional means of forecasting that were invented before there were personal computers or barely work computers. Take a long time, you get to find out that 40 days after the month, what happened in the month, I love both data can be used to generate that much more quickly. Grant Yeah, Michael, that's I love how you're bringing that up. It seems like it has both the opportunities for not only the capitalistic aspects, but the altruistic aspects of this, the values and benefits that can help society and be pulled out of that. I think that's awesome. So all right. I've thrown a lot of questions at you. So let me ask you this, if you will. To direct direct my listeners to where to go to learn more, where would you send them? Michael Well, I would, I would love them to visit our site, because and in particular to, you know, to ShareThis.com, look, look at our news and our, our blogs, we we basically we publish both as you know, as a demonstration of our the value of our data. And and it's just a general service, we publish a lot of educational and informative information about trends in the economy, and, and public interest generally about how to do marketing well about trends in data. So so we we, we try to be a resource for people and I love I'd love people to visit that content, sometimes. Some of the best stuff is is not on on the nightly news. It's like putting some of it out. I could also you know, I can give you some examples. It would be fun. I go right ahead. Knowing that knowing this audience I we are getting a sense of who maybe was listening is interested in the show, I asked our team to identify some current trends. Yeah, I guess as we come to the end of 2021. Yeah. And so so we put these together. So what one is that, that, that while the world isn't, we're seeing the trend of the gradual resumption of events in person events, even though COVID continues to cycle up and down against the backdrop of COVID. So as of August, for example, 77% of advertised events were in person events, there was a period where, you know, year and a half ago, there was there, they basically no almost having anything, it was just shut down. It was virtual or nothing. That's interesting. So as we adapt, we are adapting. And so as you as you think about should I make plans for a virtual vet, should I invest in advertise? Should I invest in participating in virtual event? Yep, don't count them out. Even if you're nervous, you know, they, they're coming back steadily. Another thing, pattern we observed in finance, that again, you know, COVID is inevitably one of the backdrops to what any of us are thinking about, but people are continuing to be engaged with saving money. So, it so as you think about what, oh, you know, what is what's going on in the in the economy? As the, as virus uptake increases, as one of the things to extract is, is increased saving? And so if that's a, again, depending on your business, how that factors in if savings is your business? Yeah. When your could be good, good to you. If if, and then let's see, what's another one? Let's see. You know, we've heard a lot about supply chain issues. And you know, what, but what, if your retailer what a consumers most worried about? When and so the top concern is shortages and out of stock, and 51% a second costs, inflation and rising prices at 28%. And then staffing issues like worker shortages and strikes, 14, and last last of all shipping delays. So it's thinking about communication strategies, what's on people's minds that might make them not come to the store? That sort of thing? So I'm not surprised. Yeah, yeah. So and we're, we're putting out new new stuff of this kind every, every month in the blog. And and I firstly, look, I think we did we have Superbowl trends out, as of yesterday, I think. Grant So it's already started to build right. That's right. That's, that's amazing. So So you gather it on an hourly basis, and then you do the AI on it Michael Truthfully, truthfully, Grant, it's being gathered continuously. Okay, that's, that's what I thought, yeah, I thought we built we build it as it happens, okay. We literally, you know, record a record for each thing. That's, that's, that's filled out all the way with all the data that will that will need eventually. And then once an hour, we some or as we frequently as our we'll sum it up into a distribution and push it to someone but the most people get their get their data delivered overnight. Amazing. It's picking it up on their AWS bucket. Like Well, this is Grant Fascinating. Any final comments as we wrap up here? Michael Well, you know, I guess that I hope I've given you a sense of the I mean, AI is critical to our business. We are you know, we When we started on this track, we were about a 50 person company, we're approaching 100 person company. And so you don't have to be, you know, IBM to use AI AI to build a great business. So it's a combination of finding the right tools and a core of of talent, the right kind of talented people, and you can and and then, frankly, sustained effort over a period of years and you can build a business that is really hard to replicate, without without it, so very hard. Right. That's, that's my thought. That's, that's Grant Wonderful. Well, Michael, thank you so much for taking your time today. I appreciate you sharing your insights and guidance with us today, everyone. Thanks for joining another episode of ClickAI Radio and until next time, go get some ShareThis.com. Thank you for joining Grant on ClickAI Radio. Don't forget to subscribe and leave feedback. And remember to download your free ebook, visit ClickAIRadio.com now.  

Jewelry Journey Podcast
Episode 131 Part 2: Make Your Website Shine: Expert Tips for Jewelry Brands with Michael Burpoe, Director of User Experience for Punchmark

Jewelry Journey Podcast

Play Episode Listen Later Oct 6, 2021 25:07


What you'll learn in this episode: Why you won't see results if you have a “set it and forget it” mentality about your website Why jewelers should give their website as much attention as a brick-and-mortar location How jewelers can use tricks of the trade to encourage customers to purchase items online, even if jewelry is traditionally bought in person  How jewelry brands can take advantage of the new shopping feature on Instagram Why the jewelry business is more like Crate & Barrel than Sephora—and why that distinction is important About Michael Burpoe Michael Burpoe is Director of User Experience for Punchmark, a digital marketing agency that specializes in the jewelry industry. Michael created Punchmark's UX team, which was assembled to take very specific initiatives toward fine-tuning tools and features, and improving the platform on both the front-end and back-end. Since early 2019, Michael has also headed up the strategy, planning, and execution behind Punchmark's Livestream Education program, the In The Loupe podcast, and the Punchmark Community on Facebook. Originally from Saranac Lake, NY, in Michael's spare time you can find him practicing Brazilian Jiu Jitsu or painting cityscapes.  Additional Resources: In the Loupe on Spotify In the Loupe on Apple Podcasts Website Blog Facebook Photos: Design Themes: Podcast Logo: Website Samples: After working with jewelry brands of all sizes for the last several years, Michael Burpoe has learned a thing or two about the strategies that make jewelry businesses more successful online. As Director of User Experience for Punchmark, Michael has helped even the most hesitant jewelers invest in their websites and reap the rewards of a fine-tuned digital marketing strategy. He joined the Jewelry Journey Podcast to explain why selling jewelry online is only going to become more common; how to make customers feel comfortable buying luxury items online; and how jewelry companies can use digital marketing tricks to increase sales. Read the episode transcript here.  Sharon: Do you find that the people who are calling your company, prospective clients, do they tend to be in an older demographic, like a baby boomer? Not that they don't understand what you're saying, but do they see themselves in you, let's say? Michael: That's a great question. It depends. If you had asked me when I started out at Punchmark about five years ago what the average demographic of people coming to us for a website is, a lot of the time, it's an older demographic. Probably 60, 65 or so, looking for their first website or saying, “Oh I have this really bare-bones website and we need to get a modern website.” The reason why is because they went to some jewelry show and they were told by a speaker, “Hey, you need to have an online presence,” and they're like, “Alright, I'm here,” but they haven't really been convinced of the value of it.  Now what I'm seeing is that, again, we're in a Covid world where the impending-ness and the seriousness of business are paramount. A lot of times the people who are running the website aren't the owners anymore. They know it's a full-time job, like I said. You can't have the business owner being the only one that touches the website. It's not going to get the love it needs. A lot of times we're seeing younger people who are involved in the online business, whether that means it's their store manager or the children of the owner. Sometimes they are specialists who they hired specifically for their website, which I advocate for. We're seeing a switch in that. I think a lot of people still need to be convinced of the value of a website, but it's becoming better, I'd say. Sharon: I'm almost afraid to ask, but once you've done the website, do your clients understand that's just the beginning? That there's SEO, PPC and social media? Do they understand there's a lot more? Michael: Early on when I first started here, they did not know that. They thought that it was a set it and forget it methodology. They get it up, they launch their website, they push it live, and they think it's going to do all the things for them. That is not the case, and we do our best to communicate that as early and often as we possibly can. I always say to people, “Your website will never be done—ever, ever, ever, ever. It has to be constantly updated.” We do have services for that kind of stuff. This isn't a sales pitch. We do have services where people can pay for us to do a lot of the ongoing work: creating landing pages, doing their social media, taking on their SEO strategy. There are services out there for them, not just with us, but we need people to understand that you can't just set it up and it's going to make $1 million on its own. It takes some work. It takes some thought. Sharon: You said an important word, strategy. How do you explain to them that you can't have it look like the Lifesavers package over here and the Tiffany package over there? How do you explain this? Michael: It depends on your service. Every business, it's like its own unique person. They all have brand voice and brand ideology and all those things that come into it; that's the bigger picture. When it comes to the web presence in general, it comes into things like what are your goals as a business? What is your brick and mortar doing as far as dollars? Is it a $1 million dollar store? Is it a $5 million store? Is it a $20 million store?  We service the entire gambit. Are you in a small town? That gives you a different strategy. Do you have competitors? Are there other jewelry stores in your town? I'm from a town of 4,000 people. There was one jewelry store in the next town over, and those people have a different strategy for, for example, pay-per-click or SEO than people in Los Angeles, where there's a jewelry store every mile. That is a different strategy as far as how centralized they should be targeting, how broad. The people in the next town over who have a jewelry store, they can set their search radius to 40 miles or 50 miles, whereas the people in Los Angeles need to be targeting very hyper-specific keywords. It's also going to cost a lot more money because the competition is more. So, it all depends. There's no hard-and-fast rule when it comes to, “Oh, you need to be doing X,” because it has to be tailored to what your business approach is as well as where you're located. Sharon: I'm sure you're thinking about this when you're thinking about the user experience, but tell us more about how that role differs. Doesn't everybody in a sense have direct user experience? Michael: I think that's a great question also. User experience is very much the nebulous specter that we're always trying to catch. I always say I can feel it when I feel it. Buying with Amazon—I hate using Amazon for the experience, but let's even talk about Nike. Nike makes great shoes. I buy all my shoes from Nike. Well, what Nike does that is so incredible is that they make it so you can find your product as seamlessly and without pause as possible. When I am buying a pair of shoes, I know I can go in and find the shoes I want without having to look. You go on. You click on shoes. They ask you men's or women's shoes. Well, I want men's. Do you want running shoes or trail shoes, because there's a difference? I want street running shoes. You click on those. They show you all of them. They have alternative angles. Those are all things that go into user experience. The other things that go into it are kind of magic tricks. For example, people who are listening at home, do this: go to Nike and add a product to your shopping cart. Go to check out in the shopping cart. What you're not going to realize until I point it out to you is that the entire navigation goes away; it disappears. The only thing that shows is the Nike logo on the top. This is true for Burberry. This is true for Amazon. When you get into the buy funnel—buy funnel, that's a fancy word for when you get into the checkout process—they get rid of as many distractions as possible. They understand that you are as close as possible to taking out your wallet and paying for those shoes or what have you, and they don't want to distract you with the opportunity to go back and read about the latest tube tops. They want you to go in and buy those shoes, and they get rid of all the distractions. That's one thing we're trying to improve as well as our checkout experience.  You can see this in real life. There is user experience in real life, and one of those examples is Michael's, the craft store. There's a reason why they make the checkout line so frigging long. It's because they don't want you to get in line and see how long the line looks and then leave. They want you to get into it, and the chance of your leaving and not converting on your sale is much lower if you're going to have to bump into other people and exit the—what is it called—the cattle line. It's very important. People have done the strategy and thought about this kind of stuff, and you can see it everywhere on websites with user experience. Sharon: That's interesting. Maybe you do this on some of the sites—I'm thinking maybe it's Postmates that does this—but you check out people who bought what you bought, those pants or this top or whatever. Michael: Right, upsells. Sharon: I guess. It seems like that might be another strategy. Is it Home Goods where the checkout line is full of all the little impulse purchase things, the dollar items? Michael: Well, they know that those impulse purchases, that's exactly what they are.  They're impulse, which means I'm going to reach over and grab the stuffed animal for my significant other at home without thinking about it. If they took that stuffed animal and put it in one of their aisles, the chance of my doing that is going be less. Also, the time I'm going to spend in front of that stuffed animal is going to be quite a bit higher while I'm standing in line as opposed to walking down an aisle.  It all comes down to data. There you can find all these really interesting things. I use this example all the time; you buy a pair of sapphire earrings. Well, if you have a little bit of a budget, maybe you should get a sapphire bracelet or a sapphire necklace and those sorts of things. Maybe you don't; no problem. But when it comes to offering that and the chance that they convert on it, one in 10, even one in 100, well, you just sold double the amount of your product. It's all about those little things that go into having a successful website. It's taking into account previous trends and things that are hot, you might say, and leaning into them. Sharon: As the Director of User Experience, I know it's all about data no matter what, but are you looking at that data and saying, “This is how we can improve the experience”? What are you looking at, exactly? Michael: You can do things in a variety of different ways when you look at data. Two years ago, Punchmark had a big switch where we measure everything now internally and externally. The mindset is that you can't fix what you can't measure. A lot of what we're seeing is that the average transaction size is going up. What that means, if you think about it a little bit, is that people are becoming more comfortable buying stuff online. The other thing we're seeing as far as data is financing. There are companies like Sezzle and Affirm where you can see a variety of different options. We're seeing that retailers that offer some type of financing, shoppers want the opportunity to use that. Affirm allows you to split payments into up to 12 payments.  Why is that good? Well, buying jewelry is a luxury. It's expensive. If I'm going to say, “O.K., you need to throw down $1,000 for this bracelet,” maybe they don't have $1,000. Maybe you won't ever be in a financial state where you can afford $1,000 off the top and hand it over, but if I was to say, “O.K., you can pay me $100 for 12 months,” the odds are that fits a little bit better. We are looking at the state of these retailer websites that offer financing options, and we see that they are converting on higher-ticket price point items a lot more frequently. That's an example of the things we look for that we can reverse engineer. Sharon: What differences do you see between a website for the rest of us versus for those in the jewelry industry? Are there certain things that jewelry industry professionals, whether you're a jeweler, a retailer, a maker, a bench jeweler, should keep in mind, as opposed to somebody who manufactures widgets? Michael: To make sure I'm answering your correct question, you're saying a difference between a small-town jeweler versus a Tiffany? Sharon: I'm saying more if somebody who manufacturers bandages decides they're going to do a website because they want to attract wholesale clients versus a jewelry industry retailer or manufacturer, are there certain things that you think are different? Michael: Yeah, absolutely. We have to look at the similarities in the products and also the prices of these products. Back to jewelry and luxury items, it's a one-time purchase, one-time meaning if you buy this $1,000 bracelet and you wear it every day for a year and you love that bracelet, you're probably not going to go back and buy the same bracelet again. Maybe you would, but probably not; that's not what we see. The reason is because that bracelet is still as good as the first time you got it, and that has to do with luxury, long-terms items.  A similar industry that has a similar buying state of mind is the furniture business. For example, think about the similarities if I buy a couch. Couches are really expensive if you're curious. We'll pretend this couch is $4,000. I love that couch. If I sit on it every single day for a year and I think to myself, “Man, this couch is awesome,” odds are I'm not going to go back and buy that same couch, but I could buy a matching loveseat. The same thing with jewelry. If I like that bracelet, I'll probably buy a matching earring. You mentioned bandages. Bandages would be a recurring purchase. I try my best never to compare jewelry stores to websites like Sephora. They make makeup and beauty products. I'm very fascinated by Sephora's business model. If I buy a concealer, for example, and I love that concealer—some women get really attached to certain products if it's the right fit for them—and I use it every single day for one year, I will probably run out. If I really like it, I'm going to buy it again. That's why there's a different mindset in the purchasing and buying state-of-mind for shoppers for luxury one-time purchases and recurring purchases. We try to lean into other sites, like a Burberry who sells a fashion product like a trench coat. If you wear it all the time, you're not going buy the trench coat again; you're going to buy something similar. Sharon: Interesting. There's so much to talk about when it comes to marketing this stuff.  Michael: Thank you. Sharon: What do you see as the top three mistakes that those in the jewelry industry make on their websites or when you're talking digital marketing? Michael: I think the first mistake—and we've already talked about this ad nauseum, so I won't spend too much time on it—is the crockpot methodology, thinking that it's going to sell on its own. That's unfortunately just not the case. You need to be thinking about it. You need to be updating things and creating new pages and working on your SEO. That's probably one.  Number two has to do with imagery. Jewelry is the most visually impactful product that might be out there. I really can't think of anything else, because what it comes down to is not the functionality of the jewelry. A bracelet, it's on your wrist and it looks good, and that's the functionality of it. Beyond that, maybe with earrings, how they move, but not really. It comes down to what it looks like. The end goal is I see it, I want it and I get it. I think a lot of times, these retailers don't put enough time into finding the right products, taking their own product photos or having lifestyle, which is to say having models with the jewelry on their website. As an example of a product details page, when you're shopping for a specific product, you can have, for example, a front view of the piece of jewelry, a side view of the piece of jewelry, maybe an up-close version if it has embossing or engraving or something like that, and then a photo on someone. You probably have a worker in your store; have them put the jewelry on. Snap it with a nice background. Now people can see how it wraps, how it looks around that person's body. I think that that is absolutely a driving force in how you can sell, so that's a good one too. Sharon: That's interesting. The positive would be that the websites that do have that—I see it more and more, where now it's frustrating when you swipe and that's it. There's only one hero shot and that's it.  Michael: If it's just one thing, like a pendant, I want to see what the back of the pendant looks like. It's going to be common that I have to see the back of the pendant. I want to see what the clasp looks like. Does it have a lobster clasp or some fancy clasp? Showing that information, like we talked about in the beginning, aids in that comfortability and that confidence when they fork over a couple of thousand dollars on this piece of jewelry. They need to feel confident it's the right purchase. Sharon: You want to see how it looks on somebody's wrist, even if it's just a plastic mannequin. How does it look on a neck? I don't know if this is my last question because I could ask you questions all day long. Michael: No, I appreciate it. Sharon: What I noticed, and I find it a little concerning being a baby boomer who's looked at marketing for a long time, it seems that everybody is moving onto Instagram. Every jeweler has moved to Instagram. They may have a Facebook page and they may have a Twitter—I don't know what the others are—but it seems they're skipping a website. It's like, “Oh, I don't need the website. I'm just putting everything on Instagram.”  What are your thoughts about that? Michael: Again, I might be biased—I'll get that out of the way first. I will say this: I think the shopping tools on Instagram are absolutely marvelous. Full disclosure: I really dislike the company Facebook. I'm not a fan of them, but what they have done is make a whole suite of tools that go with Instagram. For example, if you do these collection photos where you show a bracelet, a necklace, earrings and a ring all on one page, you can tag those products. A lot of the time, they do rely on having a website as the hub, so they're feeding the information in. I don't know if the website's time is heading toward the sunset and going fully Instagram is nigh, but I will say the tools on Instagram are incredible.  The other thing they do offer is fantastic retargeting. If you go on there and you like a product, as in double-tap it, they're going to re-serve that to you, and they can get better at fine tuning it. You can tell that Instagram is serious about being a shopping tool because they've replaced one of the five icons on the bottom of the Instagram app to become a shopping bag so people can buy easier. Sharon: Very smart. I also find it annoying, but understandable and smart, that every time I say, “Oh yeah, I like this,” “Well, we need your email address. Do you want to see anything else you want on your email address?” No, don't give me the discount. I don't want to give you my email address. Let me just see the product. But you can't do that. Michael: It's all about that retargeting. It's because it works, unfortunately. Sharon: No, it does. Michael: As someone who has worked in the industry for enough time, it can be very easy to get jaded about this kind of stuff and be like, “They're just flooding my inbox with all this stuff.” I get it. If I was on the edge of buying this product and I don't buy it, and you're hitting me back with a discount code: “Hey, get 20 percent off on this thing,” well, I was going to buy it for 100 percent. Now it's a little bit off, and now I can rationalize it better and get it. It does work. Sharon: Absolutely, or they wouldn't be doing it. I'm sure they're looking at the data. Michael, thank you so much. This is so interesting, and I'm sure it's given a lot of people ideas about what they need to go back and revisit or start doing. Thank you so much for being with us today. Michael: Thank you so much, Sharon, for having me on. I really appreciate it. If you guys want to hear more about emerging tech and information regarding the jewelry industry, we have a podcast called In the Loupe. That's on Spotify, Apple Podcasts, whenever you want it. We have a lot more information about different merging tech. You can learn more about Punchmark general at Punchmark.com. Sharon: Thanks. I do want to mention that you have a lot of very informative articles on your site. Michael: I appreciate that. Thank you so much. Sharon: It's definitely worth checking out. We will have images posted on the website. You can find us wherever you download your podcasts, and please rate us. Please join us next time, when our guest will be another jewelry industry professional who will share their experience and expertise. Thank you so much for listening. Thank you again for listening. Please leave us a rating and review so we can help others start their own jewelry journey.  

The Remote Real Estate Investor
The 7 Dollar Millionaire's Guide to Personal Finances

The Remote Real Estate Investor

Play Episode Listen Later Aug 19, 2021 49:56


Author of Happy Ever After, The 7 Dollar Millionaire, joins us again to shed light on the complex world of personal finances. He shares tips on getting started, saving money, and aligning your goals with your family to work your way to financial peace of mind one step at a time. --- Transcript Before we jump into the episode, here's a quick disclaimer about our content. The remote real estate investor podcast is for informational purposes only, and is not intended as investment advice. The views, opinions and strategies of both the hosts and the guests are their own and should not be considered as guidance from Roofstock. Make sure to always run your own numbers, make your own independent decisions and seek investment advice from licensed professionals.   Michael: Hey, everyone, and welcome to another episode of the real estate investor. I'm Michael Albaum, and today I'm joined by my co host,   Tom: Tom Schneider.   Michael: And with us we have a very special repeat guests, the 7 Dollar Millionaire, if you recall, he wrote a book that we had him on chatting about Happy Ever After. And today, he's going to be talking to us again about personal finances, some things you can do to get started, as well as how to talk to your spouse or significant other or partner about personal finance. So let's get into it.   Michael: Awesome. Mr.7 Dollar Millionaire, thank you for joining us again, we so looking forward to recording with you.   7 Dollar Millionaire: It's a pleasure. Thanks for having me back on that says, this is a first for me. No one's ever invited me.   Michael: Well, hopefully the first of many. So how have you just curious how are things out in Singapore?   7 Dollar Millionaire: Things are just improved. Yesterday, we had like a mini re lockdown. So they call it circuit breaker here for about a month. Because there was a bit of a spike in cases. But that ended yesterday. The big change is very little apart from Oh, you're now allowed to go to restaurants, their restaurants are all closed. That's pretty much it. Gyms are kind of reopening slowly, that kind of stuff. But yeah, that was that was nice. It's nice to kind of go and get a meal somewhere, you know. But otherwise, it's you know, as with a lot of Asia, they're taking that kind of minimal risk approach to it.   So I mean, even when there was a spike, it was like 100 cases a day. 5 million people, right? I mean, it's still a very low number.   Michael: Yeah. But everybody in your world is healthy and safe.   7 Dollar Millionaire: Oh, yeah. Thanks. And you guys are on good.   Michael: Yeah, we just chatted with some family friends of ours yesterday, and they are double vaccinated. But she and her daughter just got his tested positive. So she had a breakthrough case. So she's feeling pretty crummy at the moment. But I'm hoping that she's hoping she's not going to go to the hospital or anything like that. So the breakthrough cases don't seem to be as severe as the unvaccinated stuff.   7 Dollar Millionaire: Fingers crossed. Yeah, fingers crossed. touchwood. Right. That's that's the big hope. As long as it stays like that we can live with it. Right?   Tom: I have a friend who had a breakthrough case who's also vaccinated. And he's got a wife and three little kids and his wife and three little kids didn't, didn't catch it. So he's hanging by himself. And you know, I feel much more for his wife, who's managing a house full of Toddlers and Babies versus him who's just hanging out at their their lake. Well, he's men. He's on the men. He's feeling much better. But it's Yeah, really.   7 Dollar Millionaire: Did she get did she get like a second opinion on that? Right. Yeah.   Michael: Thank goodness.   Tom: Yeah. Doing recovering. Well, good, good.   Michael: Well, Tom, it's it's funny as the wrong word. But interesting. This kind of segues nicely into what we want to chat with the 7 Dollar Millionaire about today. Again, circling back and talking some more about personal finance. But a question that I have is, so often people have these target goals in mind, and whether that's net worth or cash flow monthly annual basis. But that's so often based on today's needs, for their whatever family is currently in the picture. And I've got to imagine that changes over time. And so as someone who doesn't have kids, I don't have a really good sense of what kids costs, it could be 20 bucks a day, it could be 100 bucks it you know, I don't have a good sense for that. So how do you recommend folks think about not only their cash flow needs for today, but also for their future selves, as they continue to age but also as additional family members may enter the picture?   7 Dollar Millionaire: Yeah, I mean, it's a it's a there's no right answer, right?   Michael: I mean, I mean, oh, well, then we can we can we can cancel the show. We're done here.   7 Dollar Millionaire: There's just no single one right answer. I mean, the first step with the first answer to this is actually just taking the first step start actually doing some work, right. I think I was working recently with talking about how you make all the progress in personal finance. And a lot of people are discouraged because they think they can't come up with an answer. And it's like painting, right? The first blob of paint on the on the canvas doesn't look like the painting You can't expect it to you go put it on, put it on, put it on. Only after a long time does it actually start to get to the real picture, and it's the same, it's exactly the same with this. You just got to start doing the work. And starting doing the work is actually working out what you want your kids to be like, what kind of life you want to live with them where it's going to be, and the kinds of expenses you're going to have.   So you can roll that stuff out pretty easily. I mean, so For me, because I was an expert, I had to put my kids in international school, there's some serious education expenses. You know, it's like the, for me, when my kids went to college, they got cheaper. I mean, that doesn't happen very often, right? My kids got a lot cheaper when I was paying for them to live in a foreign country, flying them backwards and forwards and paying college fees, they were cheaper than the local education costs for me.   So that's how individually these things can be right? I mean, you just have to do that. So you have to look forward and you think, okay, and I'll give you perfect opposite example, really good friend of mine used to live like five floors below where I had seen the apartment block right here. He's got for various reasons, he ended up with like, kind of one of those joint families who so like, five kids under the age of five, you know, bizarrely, and really bonded, situated,   Tom: Yeah, Brady Bunch situation.   7 Dollar Millionaire: And he's, he's like a, he's a fund manager, based in Singapore. And he worked out that he could actually, it made sense for him to quit his job and move back to California, because paying for five kids in local education system here, when you know, that, and everything else, it's cheaper to move to a place with a good free education system and have a normal job rather than trying to have a high paid job and pay those kinds of costs.   So that's how individual all of these kinds of decisions get to be. The first thing is just to sit down and, and dream a little, right, exactly. Who do you want your kids to be? And how do you want to live with them. And because a lot of the costs, like your actual food costs, it's not a big deal, it's really not going to be an enormous deal. So the basic, you know, adding one bedroom to the house may or may not be a big deal, depending on on where you're at. And then after that is things like education and flying, holiday is right, they do cost literally an extra person on every single thing you do, when you start and that's times 20 years, right?   So there's, there's some, there's a lot of extra costs on that kind of stuff. And it's really just sitting down and working out those kinds of things, and those kinds of budgets. And then as you move closer, closer towards the end, you'll realize exactly what is going on, you'll get a much closer impression. But as always, it's just start, just sit down with a piece of paper and just go, Okay, I think it could be this, and then find out the extra information that you'd actually need. Because it can be a scary amount, or it can be really, if someone for someone like me, that was having to pay man it was 15 years of 14 years of school fees. I don't want to think what that was, you know, really, I definitely don't want to, you know, PV it, I mean, that's just insane amount of money. But you know, had to be done for In my case, if you don't have that you don't need to put it in.   Tom: I love that analogy of the paint, and it just kind of evolving a little bit over time. As far as, you know, practically getting the paint down, would you recommend a model where, say this is in Excel, and each row is like a year, and then, you know, perhaps there's some different sort of expenses within the different rows, or it's just like a really kind of basic form of that is that sort of a rough construct is, and I'm sure it's you know, could be a little unique for everyone. But that's immediately where my mind goes is seeing in that sort of a model.   7 Dollar Millionaire: That's definitely where I think you move it, I actually like to do a pen and paper to start with, I think there's a, there's kind of a free flow, when you're actually kind of sit down with pen and paper and just as scribble stuff out. I've even tried doing it on my iPad with you know, like the sketch but it doesn't work as well, there isn't that sort of connection, which sitting there with a piece of piece of paper and a pen for 10 minutes, and just sort of scribbling out the bunch of the cost because we're all prepared to be kind of messy on a piece of paper, right, and we can just draw in things and loop them around, that connects to that, scribble that out and need this.   And then once you've got probably only 10 minutes in, you can move that to a spreadsheet, seven or eight lines, seven or eight lines is going to get you most of the way to the kind of things you're thinking about.   Michael: And Tom, I'm curious not to put you on the spot here in the hot seat but having a young child is this an exercise that you went through with your wife and was this conversations that you had prior to the little one arriving?   7 Dollar Millionaire: You know, I was actually so I'm in my mid 30s now and when I was in my mid 20s and early 20s actually was way more active about kind of performing out like 20-30 years in advance so I actually had to pull back the old spreadsheets pain analogy I think it's probably time to have another round I love these interviews with you 7 Dollar Millionaire I literally after our last call that we had I went and totally redid all my you know auto deposit into my investing and I already have some immediate action items from from this one. So just to kind of go back I was I not not so much with these with with my current kid but I think it's an exercise to go revisit some work that I did in my mid 20s.   7 Dollar Millionaire: It's always good to know right? It's also good to know how good you are at modeling. Where you make mistakes and modeling, I mean, we we professionally we do that. And it's you know, you can be miles out. But if you actually, I mean, there's a company modeling, we're actually modeling like an investment will have various inputs that we can that we can change them to go back and you look and go, Oh my god, I was miles out, but then you realize that one of the inputs was x, y, zed, which turned out not to be remotely true. So you can, okay, then change that. And sometimes it kind of comes back to closer to reality. So all these things are really, really important to actually just understand how well you model because it's not like you have to stop modeling, or you never stop acts.   And modeling is like, it sounds like it's too specific to what we do. But we're all forecasting all of the time. Now, my favorite analogy for forecasting and how we're all forecasting all the time, is we all pretty much expect chairs not to break when we sit in them, right?   I mean, even some of my weight, I don't expect the chair to break when I sit in it. But I pretty certainly if you if you sat on three chair, three different chairs in a row, and they broke every time, that fourth chair, you'd be like pushing it scratching it thinking, Okay, is this thing solid, you'd have lost all your trust in chairs, that's just forecasting. It's just natural forecasting. We do it all the time. And so knowing if you're good or bad at it is a is an amazing life skill.   Tom: Do you find that most people are overly optimistic when forecasting I guess you could apply this to business or to kind of personal? I'd love to hear your kind of thoughts on, I guess human nature and in applying forecasts and ways to beat yourself and be better at it.   7 Dollar Millionaire: Yeah, I honestly, unfortunately, it really it is really bad answer. But 50% of people are better than average. And there's no other way of looking at it. I think the key is most of us aren't doing it particularly consciously most of the time. And so sense of like actual aware forecasting and awareness of how optimistic or pessimistic we tend to be. Pessimists, I mean, pessimism is one of the reasons that overcaution is what keeps a lot of people out of the markets. Right. And because they think of it as markets, right, they don't think of it as I'm working. I'm living in this economy, and not being in it with my capital is essentially an enormous risk that this economy is going to crash and burn. I'm literally taking that investment option. And not seeing it that way keeps them out because they view it as being very, very high risk and pessimistic because they don't understand it enough.   Let's throw some analogies around that's just like being in the dark, right? It's just being in the dark, you can walk out into your hallway with no light, and you can't find your way along the hallway anymore. Right? That's, it's it's still there. Everything's exactly where I was people without the education. I mean, we're moving back into financial education, right. It's what keeps people out. It's they're unsure, they're in the dark. And that's why I think creates most of the pessimism and overcaution around it.   Yeah, there's a bunch of people who, too, you know, too optimistic, too. But that's what I mean. I tend not to mind it when when investing, I don't engage over optimism. But when I'm doing things like a little bit more entrepreneurial, then yeah, I shoot for the moon. There's just no point right? or shoot for the stars even then you get the moon there's no point not being no point starting an endeavor without thinking it's going to be amazing.   Michael: Yeah, I love that analogy about being in the dark. I wonder though, your take on, when people have gotten out into the hallway realize that it's not that scary. Or maybe they've gotten a little flashlight, it a little bit of education, they understand. And now they think, Well, I know everything. And so how does that that little bit of education, a little bit of knowledge, not get overblown, and a bit turned into overconfidence, where now you are taking risks, well beyond your your light beam, so to speak.   Tom: Great point, Michael.   7 Dollar Millionaire: Yeah, it, it's it's actually why I think it's so important. This gets taught in schools. And, you know, there's, there's a bunch of different sides on this. But it's, that's why, you know, why are we confident reading? Right, we're confident reading because we've been taught it at such a young age, right? This is this is how we have that kind of confidence. Why are we not confident in a foreign language? Because we weren't taught it. We don't know any of the words, we don't know how this thing's put together. And we need that it's, it's about having that broad underpinning to what we do, and it's why it needs to be taught in schools because any other way, you're coming in at some random entry point, right?   So some friend tells you the you know, you should trade options on Robin Hood because I made x, y, zed and then you kind of get in there and you learn a little bit about it. Maybe you have like some Beginner's luck and you do quite well. That's now your little wheelhouse. It may just may be a good wheelhouse for you. It may be a terrible one. More likely the second option, right. So that becomes your think that's what you need that we need the education to make sure we get a little bit of light in all areas.   I mean, I'll give you a perfect example for this. I so the CFA exams Chartered Financial Analyst. I'm not one I did level one.I got way too busy to do levels two and three, my first daughter was born like immediately after getting level one. And level one even just shows you the entire spectrum. So you kind of you get like a beginners entry level on everything. And that's like, you kind of you know where to come back to later. Right? If I need to calculate a bond price, I can't do it off the top of my head, but I know where to read. I know where to look. And then I'd know how to do it. And that, obviously, that's a little bit specific for most people. But that kind of general entry level stuff is I think, you know, what's needed otherwise, you do end up with the flashlight, or moving from analogies. Under the under the street lamp looking for their keys, right?   You know, the stories like, you know, and the guy's looking for his keys under the street lamp and a piece of wedge, you lose them over there. So why are you looking here? Well, this is where the light is, right? That's it's so important to just have like a basic level of light.   Tom: To know what you don't know. Definitely.   Michael: Yeah, that's Yeah. I'm curious to know, in your opinion, if someone is looking to invest in the next 12 months, they're looking to get educated and wanting to get involved, whatever investment class they deem is in their wheelhouse, where should they be keeping those funds? Should that be something that they're investing the whole time labeling? And, you know, dollar cost averaging? Or should they kind of wait till they have enough funds to do something with curious to get your thoughts?   7 Dollar Millionaire: Okay, well, always dot dollar cost average, unless there's like a ticket price that, you know, makes that unavoidable that you have to go in single level, like, like some kinds of property, right, where you have to have a certain amount of downpayment, and that's the minimum you can get involved. The great thing about other asset classes is you can dollar cost average in the tiniest amounts. And you always should, I mean, cuz, you know, you can't predict the future, you don't know if it's gonna go up or down, right. So you should try and remove as much of that risk as possible. And dollar cost averaging is the is the free way of doing that.   Michael: Right.   7 Dollar Millionaire: So right, so always dollar cost averaging, I think there's a one thing that I quite like is what I think of it in my head is like a reverse ladder. So you know how you have ladders on fixed deposits, time deposits, whatever they call them. In the US, you know, where you can get kind of get like a little bit more return, if you lock the money into a deposit account for longer, let's say three months, six months, whatever it is, and you stagger it in. So you put in like a sixth this month and a six the next month, and then you do that over six months. So you got the money, you got access to six of the money every single month, you can put it put it into those and then actually dollar cost into the thing you're putting it into. So you can sort of you're still making a little bit of money doesn't have to sit as pure cash. Right.   Michael: So so go get six CDs.   7 Dollar Millionaire: Yeah, exactly.   Michael: on six month intervals. And okay, gotcha.   7 Dollar Millionaire: Yeah, exactly right. And then you can just plug it straight in. And you might only be making like an extra, like a few bucks. But this is how you make money, right is by it's like that little extra, which for no risk, right? That's always the key a little bit extra, no risk is better than a lot extra for a lot of risk. So just that just that small, those small moves are always useful.   But I think also one of the other things to do is depending on the asset class, if if what you're doing, if the cash you've got is a long way away from the asset class, then it does make sense to have some kind of hedge if it's possible. So I mean, I think one of the things often is say, like, being able to put some of the money into a REIT in advance of buying a property.   So let's say if there's like, if you're going to buy property in New York for some reason, then there's a new york rate, if you can do enough analysis around that read to understand it's like, oh, this is, this is pretty similar, this should go up when my property goes up, it should go down when my property goes down, you can at least put some of the money as you're building towards that downpayment into the REIT and then hedge out a little bit of that extra risk. Because, I mean, the risk on property is nearly always, everywhere in the world, the government prints more money, right? I mean, properties actually don't…   Micheal: Inflation.   7 Dollar Millionaire: Yeah, well, yeah, properties don't often go up in value, your money goes down in value in terms of property, right, that's what actually happens. So actually, removing that risk is is is useful. So I'd always think through these ways, rather than thinking, yeah, just chucking money in now. Just steady push it in steadily as it's just if you can, if you have the patience.   Tom: That's a that's a good discipline. I mean, it kind of related as an act of discipline I can think of like going to a, like a kiss going to Las Vegas or something and playing blackjack and it's like, oh, do I push it all in on one hand or do I slowly and you're gonna have a better time to her a little bit slower. I guess that kind of really kind of relates to having fun at the casino versus having fun at.   7 Dollar Millionaire: It is a good point because I do the exact opposite. I really don't like being in casinos and when I'm forced to go to them, I put it all in on one hand and literally   Michael: Walk away.   7 Dollar Millionaire: Just like get this over and done with either make a lot of money on one hand, or we are I'd leave and have a better time than I would do by sitting at a blackjack table, losing money steadily.   Michael: I love how you knew kind of exactly where I was going with the question with regard to property investment. Because I mean, Tom you were in a similar situation with regard to you had some cash or cash out refinance, you were looking to deploy it. And in the meantime, you were thinking about putting it in the market, and I think you ultimately did. And then there was some fluctuation in the market. And you're like, Whoa, this is not this is not feeling good. So you pull back a little bit, right?   Tom: Yeah, yeah, just, I think like within, there's more, like risky allocations, and then safer allocations. And I think, being cognizant of kind of which risk profile I was investing, versus the strategy I initially did was go running up to the blackjack table and throwing it all down. And, you know, thankfully, didn't get getting didn't get burned too bad. But, you know, stepped back away and left the casino and invested in a nice asset allocation that was comfortable for the time horizon at which I wanted to spend it. So..   7 Dollar Millionaire: That's I mean, that's, that's, that's also the other point is actually nothing wrong with taking a second most important thing of investing is actually understanding your own psychological needs, because you can't invest against them. It's really, really hard to actually invest in a way that you don't think is correct for you. So taking too much risk. And just I mean, I don't have sleepless nights with what I do for a living. Because I don't invest in a way that is wrong. For me. I actually feel like I understand what I do. Whenever I hear people like they have sleepless nights like that's because your style investing does not match what you actually believe. I mean, that just can't be. That can be the only reason I think what you did, there was smart.   So the only way I've done this in the past is that I buy I bought properties in the past in, in foreign countries I have bought in Singapore, once I buy in the UK, I bought in Japan, I bought in Australia, one of the things when I know I'm going to do that is I immediately switch the money into that currency. If I think it's cheap, I think it's expensive. I don't.   But I try and you know, work because current currency, and I do sometimes take a view on the currencies. So you know, but that's it's that kind of move. So for example, I think I kept I think I kept just cash in a deposit in Sterling for about three years before I bought a property there because I wanted to take away because it was cheap. And I wanted to remove the currency risk, that it would get more expensive at that particular time. Basically, the moment Brexit happened and the pound and the pound collapsed, I put money into Sterling, because I knew I'd be thinking about buying a house not long after,   Michael: I think I've mentioned this to you in the past, Michael, but I really took it on the nose with the currency exchange because I bought a place in Portugal. And it was right around February, January, when we were looking at doing a transaction and the dollar against the Euro was like 94 cents. And it has just continued to climb and climb and climb. And so this is going to be great. This is going to be an equal transaction, by the time I go to actually pull the trigger. And so I waited, waited, waited and then COVID hit and the dollar just tanked. And I really got taken to the carwash on that one.   So I think that makes sense is if if you if you know what it is today, that's worth something and how you feel about it, I think is also important, but also a bird in the hand is worth two in the bush.   7 Dollar Millionaire: Well, it's it's actually a lot of these things is understanding future liabilities, and not just your existing liabilities, but your future liabilities. And that's one of the ones like with kids, right? You're going to have these are future liabilities, you've got costs down the road. And if you know that you've got, you want to have a place in Portugal, then if you think the currencies pretty decent, and you know, you don't have a view either way, you can just put that money into into euros immediately and just remove that risk, right, there's no risk now. Right?   If that money wa s just gonna sit, and you could have it in euros doing something else, I mean, you can still take another risk on top of that, but at least you've closed off that currency risk. And currencies, they move around a lot. I mean, there's, you know, within like a two or three year timeframe, they can really shift. And that's a risk that's nice not to have or even potentially gain you can make rather than, you know, taking that huge risk.   Tom: So backtracking Just a minute, a little bit ago, you were talking about if you were to evaluating buying property in New York, and you know, parking it into a REIT in that space. I never and then you know, you can research that read I never thought of that, because they're sort of there's this is, you know, primarily single family rental investors. There are single family rental REITs out there. And is the idea to maybe to to learn more about that specific REITs that you're going into that asset class like to benchmark what kind of returns you what are my totally hearing this on a different?   7 Dollar Millionaire: I think you know more about the US property market than I do. So I'm, uh, yeah, you're probably hearing things I don't know, all I mean is is as close as you can remove risk, I'm not talking about actually   Tom: Sure getting as close.   7 Dollar Millionaire: Yeah, the closer the asset thing, the asset class you're going to buy, you're removing as much risk as you possibly can. So if it's in similar geography, in a similar asset class in a similar geography, it still may not correlate, and there's nothing you can do about that there may be a problem with the REIT, and there may be a problem with a manager and maybe a problem with something else. But if you're going to buy commercial property in New York State, if you can find a commercial property right, in New York State, yeah, then maybe maybe there'll be reasonably correlated, and you're taking a risk there, that, you know, there's no reason for cash to be correlated to it, there's definitely no reason for any other asset class to be correlated to that thing. So just a little bit of work and probably find you, okay, what's the new what's the New York State REIT, which ones are similar? Bang, okay, that one might reduce my costs and reads tend to pay pretty good dividends as well. So you actually could get paid out while you're doing it. So the return could be stronger, while being more correlated. And that's kind of all you're aiming for. with that.   But I mean, I'm gonna say as well, I don't know, if I mentioned on last couple of one of my it's a small family single, you know, real estate, is actually just such one of the best asset classes to be in as an individual. Just because it's not not something that big corporations do particularly well. And that's where it's sort of maybe steer clear of big corporations tend to do big properties very well, right. It's just like one guy making a decision pushes a button, and then the whole building does x, y, zed, right? Whereas when you look at what we all live in, so small fixer uppers, those single unit setup takes an enormous amount of management to run as a business.   So that's one of the reasons I love real estate as an asset class is because the world's capital is not trying to jump into this, right, it's just individuals doing the thing they do. So we can have an advantage. But within the REIT, maybe less if you get too specific, too granular. And I just sort of aim, you know, and the other thing would be to not get into to smaller thing, right? You want it to be liquid, you want it to be well traded, you know, one reasonably well known   Tom: That makes sense definitely.   Michael: Makes a ton of sense. I'm curious, Michael, do you have generic guidelines or principles when you're teaching, you know, financial education to folks around how much of someone's paycheck or how much someone's net worth should be broken down and spent on the different typical categories? So housing, or transportation or food entertainment? Do you have a pie chart that you that you utilize?   7 Dollar Millionaire: No. I mean, there is one, right. There's the 50 30 20, that is commonly used. And it's a great starting point, I actually think the 50 30 20 is a great starting point. But I think there's just too many examples of people who do way better than that, than I do. You know, you don't want to set the goalposts too easy, right? You know, you just come across people who are saving half or even three quarters of their of their income, and you don't want to tell them, You should save 20 it's similarly right, you know, it's just like, but the only one I really use is like, never go above like a third of your income on property.   And I think if you can keep it below that number, pretty much everything else starts to slide with it. Right? You start your cut, a lot of other costs are gonna be I mean, so in the book Happy Ever After I use 50 3020 as a starting point, but then say, Well, yeah, you know, but what if you could do 30 30 10? Right, you know, 30 30 30 30 30 40, because it would be, because 30 30 10 doesn't add up great. But if you can keep those costs down, all of those extra the 1530, way below those numbers, you're adding up to a much higher number on the 20. And that's the thing, I think, to use that 50 30 20 is a great thing to say to someone who's saving zero, or 5%.   Tom: Sorry, just to clarify the 5030 is 50% is your needs housing, grocery grocery, all that 30% is the ones and 20% savings. Is that the?   7 Dollar Millionaire: Yeah, that's right. Yeah, that's, I mean, it's not that I didn't invent that. I think that's a standard financial personal finance tool. And, you know, as as with the glob of paint, right, it's a great job of paint, unfortunately, it's kind of it sounds to 20 20% is gonna have you if you did it from the age of 20 20% is going to have you retired somewhere in your 60s. It's not amazing, right? That it's it's, it's better than not, but it's it's not amazing, and that's where I wouldn't want to see it to see us as I try to use it just as a general this is dob of pain. 20 is great, but if you want to do better, you should aim for better.   Michael: Yeah, that makes tons of sense. And I think that's great. I love I love that dob of paint analogy. I think it makes so much sense. I'm a very visual person. So that that resonates with me.   7 Dollar Millionaire: Cool. That's good. That's really good. Because it's because I wrote it for for a new book I'm working on. So I'm glad it works. I'm trying it out with you guys.   Michael: Are you really writing a new book?   7 Dollar Millionaire: Yeah, yeah. This is actually the first morning in about three weeks I am, I've got up to talk to you guys instead of getting up to write. But I've been writing to non stop for last three weeks.   Michael: Awesome. Can Can we get a little preview as to what it's about?   7 Dollar Millionaire: Yeah, it's it's an attempt to combine Zen mindfulness practice and personal finance. So I'm trying to map I'm trying to get that Venn diagram. I feel at the moment, those Venn diagrams are like, here, I'm just trying to merge them. But in many ways, I feel that they merge really easily. It's like, you know, it's what is tracking what is tracking your spending, if not being mindful of what you're doing?   Right. I mean, you sit down and journal but journal your expenses, right actually know what you're doing in life, I actually think they they align quite neatly, I just haven't seen anyone do it before. And, and I, one of the things I've realized more and more about personal finance is that the SEC, the same five or six things, we all need to know how to do the basics. But we need to approach every person in a slightly different way to get those five or six things in. Once you're in, you'll learn them really fast, but you need to get in.   And that's why I sort of just occurred to me will be a fun thing to do. So yeah, I need it to be fun. As well, I need to actually want to be able to, if I have to get up at six in the morning, I have to want to   Tom: Yeah, big, big mindfulness fan, I try and do have a personal retreat every year. And man, I can just see how a lot of those concepts of just being present is so relevant. And you can basically apply it to anything and it's so natural into, you know, the currency that, that our resources that we live off of its camp can't wait for it to talk more about it and for it to come out.   7 Dollar Millionaire: Cool. Well it come at it. Well, if I finish it, it should come out next year. That's exactly what it is. I mean, it is this sense of in every place in our finances, if you're not aware, they take control of you rather than the other way around. And if you can be aware and mindful of what you're doing. So even to the standard market to you over emotional, are you under emotional, you know, how are you what's actually going on in you, that is making you do things that are not to your benefit and understanding those things are such important drivers and in the in the space. So addressing all those things. Equally, what's quite nice is I feel like I can recycle the some of the Happy Ever After book as well, because the middle of the middle bit of this book is a man being the same steps mission, money income saving, spending, investing, owning now those steps.   And so rather than to using sort of like the fairy tale, we sort of really creating a path. And as with so many things on sort of mindfulness, this is a path, you have to understand the path and now you hear whether the dob of paint was coming in, right? Don't get upset that you don't know where you're at, you're just putting a dob of paint is just the first dollar painting this will build. And that's Yeah, that's why I'm so happy like the analogy cuz it's right up the front.   Michael: Oh, this is great. I'm very excited to read the book. I want to shift gears here a little bit. And I'm curious to know if you have any tips or tricks or guidelines for folks to have these types of financial, personal financial conversations with a spouse partner significant other, because so often I hear in the Roofstock Academy is Hey, I'm all on board for real estate, but my husband isn't, or my wife isn't or my partner isn't interested? How do you bring them in in a productive way?   7 Dollar Millionaire: Yeah, it's hard. And you know, you, it's okay, we're gonna get back to the mindfulness, but just for a second, and I'll come back to this, right, because   Tom: It's all part of everything   7 Dollar Millionaire: You have to know is that you, you can only affect yourself, you can't create change outside yourself, you can only create change inside yourself. So you, you can't force a partner to come up to your speed when you want them to. So that's the number one understanding. So you got to be ready for them to not be prepared to do this.   The second thing is, it's why I wrote the book is for the original one happy ever after it was to outsource a lot of the conversation with this time, but that time with my daughter to paper, get her to read it. So I don't have to go through an enormous amount of the background of how this works, right? It I can just imagine it. When I realized my daughter didn't know anything about money. I was like, I've got a teach her this stuff. I don't want to spend every weekend for the next year having daddy daughter money lectures, because that's just you know, it's wrong.   Right? So but if I write her book, she can read it in their own pace, and we can have those conversations and she's already up to speed. Right? So to get some level of outsourcing so to encourage, could you read this book, have a look at this, what do you think about this, and then let the person do it in their own time. So they'll come up to speak because again, we go back to that you can only change you they have to change themselves on on their timeframe.   I think the other thing is too, sometimes it's useful just to have like a group budget as a track as a family exactly where all the money goes. Because that That, to me is like, is the starting point we're spending money on on these things. And you know, if there's any dispute, it's like, let's get the, let's get the receipts out, this is actually exactly where all our money went in the in this period. Because I think that's the, I think it's very difficult to jump from an investing mindset. Jump to it, without going through saving. And you have to warn you that that requires understanding your spending.   So those two things combined to be like, okay, we understand that what we're saving and what we're spending, okay, now we can invest our asset class, we can we can move on to as you said, How do I get my spouse to think about real estate, they're probably not thinking about it, because they're not probably not thinking about the saving and spending, the moment you think about your, I'm going to give up this spending to save the money, you tend to get a lot more interested in how much money that money is going to make for you. So you tend to get a lot more interested in the asset class. So I that's why I do see these things as being a 1234. And then you can get them interested in the asset class.   Tom: Maslow's hierarchy of conversations to have with your significant other. Yeah, it's, so this is a one would be, I guess, spending, saving, and then more offensive investing that I understand this kind of triangle correctly.   7 Dollar Millionaire: Okay, I will never allow spending to go in front of saving savings by okay. It's in the dictionary in the book in life saving comes first, right? Get the saving done first. And the saving is how you top up your yield. So the safe spending is cutting down on your spending is how you top up your savings. Right? Did you put the put the savings away first.   But yeah, and then once you've got savings, you need to do something with them. And so the thing you do with them is what asset class and then you can have those conversations. But if the person isn't engaged in the saving, right, then they're probably saying I don't want to invest in real estate, because actually, I'd rather be spending the money on a car.   And you've got to move the people have got to be with you on those steps. And it's, if then if they haven't got those fundamentals like Well, yeah, we could buy the car, but these savings will double in 10 years time and quadruple in 20, et cetera, et cetera. And then we'll be setting we can have as many cars as we want, if that's your thing. But let's just actually understand our priorities today, and where we want to be with that.   But I do think it's really important not to make that a face to face conversation too often, unless you're both open to that and let that someone like me, let an author let a book, let a TV show, do the heavy lifting, right? I mean, and then then have the conversation subsequently.   Michael: So for anybody listening, needing to broach this subject with a partner, spouse, you can either go get Happy Ever After by 7 Dollar Millionaire, that's great.   7 Dollar Millionaire: I couldn't have said it better myself. Love it, love it.   Michael: I know you're not really familiar with the US system of Roth versus non Roth, but we can talk about it in a higher level discussion. And so in the US, we have Roth and non Roth retirement accounts. A Roth is simply you pay the tax on the dollars that you invest on the front end, and then you get tax free growth and distributions on the back end, versus a non Roth is you get a tax benefit of reducing your taxable income today, it grows tax deferred, and then when you go to remove those dollars, it gets taxed at that point in time. Do you have a sense for pros cons, how people might be thinking about this?   7 Dollar Millionaire: The only thing that go into there is I'm assuming there are some other sub clauses in terms of what your access to the money in the intervening periods? Right? So I'm guessing from what you've said, that the one where you get, like, you pay tax now and you'd be don't pay tax on on the eventual money. You can only take it out on a certain date. And if you take it out between those dates, I'm assuming there's some kind of penalty as the as the price of actually getting a tax tax, tax free later on, are tax exempt.   Whereas the other one sounds more like well, if you know, you're actually if you're not being taxed on the money that goes in that's probably fairly similar. But I'm guessing it's probably a little bit freer money in terms of you can probably access it at any point in time.   Tom: The big gating factor between the two is there's limitations on who has access to use a Roth, this one that's taxed up front, and that your income needs to be under a certain level.   Michael: But the access to the funds are fairly similar in that you pay a penalty on both if you remove them before your retirement age. Yeah, yeah, I mean, I think if you can afford it, you probably want to put the money away that you can take it out later tax free. That to me sounds like you know, because then you, hopefully if it's a long period of time, and it compounds reasonably well, that's a bigger number than the money you're putting in. And that's how the only thing I could think of that. Honestly, these things is weighing me up. I people make tax codes way too complicated.   It's just like they make tax codes complicated. And then don't teach financial literacy in schools. The idea of this is beggars believe, right? The problem with making them complicated is very often, it tells people like, it's like, we go back to a dog with pain, right? We go back to our dob of pain, someone is telling you, I need you to paint the Mona Lisa, and you've never painted before, you're scared to put the first piece of paint on, you won't, you'll just, you know, you'll have you'll kind of you'll have like a punk rock moment, and you'll toss the canvas and break it on the wall and walk out the room.   That's what everyone does. Everyone's just like, this is too hard. I'm not doing it. And so you stop people actually getting involved. So I am going again to run again, all of these systems are way too hard. The correct answer is save them money, one of those will be doing deep, it will be better than none of them and don't over stress it.   Personally, I probably go to have the tax deferred later. Because I want the money to compound my age, that's probably wrong. Because I'm you know, I'm probably begin taking the money out in 10-15 years, so might not compound that much. And I might be better off actually having more money now. And I suspect that's where the differential is. That's probably where, you know, that's where the delta is on that. But God, I mean, that's just way too hard. Sorry, not telling you off it. But it's way too hard a question to put to someone who probably has very minimal financial literacy, I could probably work out what the right answer is with a spreadsheet. That means it's a really bad policy to be offering people. Sorry to criticize your country.   Tom: I like it.   7 Dollar Millionaire: Okay, good.   Tom: My wife's a tax attorney and keeps keeps busy. Yeah, moving tax code.   7 Dollar Millionaire: Oh man. It's actually it's actually also one of the reasons why, you know, the financial literacy thing is so important, because you can't trust governments with this stuff. In the we all think that everything we experience from childhood has been around forever. The reality is, before the Second World War, most people were dying around 65 70, they did not get a pension because they didn't need it. They were literally going to last maybe four or five years after they after they finished work, they would expect to work to death. And only after the Second World War, do we get this mass input of pension schemes? And which is why in lots of countries, they're just paid out of government revenues. And I'm not saying that's necessarily a bad thing. But it does. What it means is it's not necessarily going to be around forever. Tax codes aren't around forever. And it's one of the things that I worry too much about putting too much time into worrying about tax codes. Because by the time you take the money out, you'll have been through five different tax codes. It will all have changed so many times that if you try to think long range about tax, you're doing the wrong thing, because the risk on that is enormous.   Michael: That's such a good point. I think so many people hear about Taxco changing scramble to do whatever they can. And then next president next administration comes around things change scramble to do what we can and then you know, over and over and over again.   7 Dollar Millionaire: The people that make the money are Tom's wife. They make all the money!   Tom: She is just there, interpretating whatever, whatever comes out. Yeah,   7 Dollar Millionaire: Yeah, exactly.   Tom: It's good for the Schneider family. It's good for them.   Michael: That's great. Well, I think we just got to wrap this up, Tom, any other questions for the 7 Dollar Millionaire?   Tom: No, I love it. I think of all of our podcast guests. I never have more like impactful like meaningful, like things that I go off and do after the episode. So I really appreciate you coming on super excited about the book coming out.   7 Dollar Millionaire: Yeah, thanks very much for that. It's, it's, um, I'm really excited about it, too. It was the publishers Wiley to appeal to published happy ever after. And they, they asked me when I kind of that they were actually publishing happily ever after they said, do you want to do a follow up? And I was like, No, no interest. The and it because I took that to mean that did they want me to write teaching my daughter how to invest properly, and not as a cop out? That's just too complex.   You know, the reason I write what I write is I'm interested in getting people off the ground up to being able to understand other books. I'm not interested in the other books, those are all great. They've already been done, you know?     And then, you know, while he was coaxing me and saying, Well, no, we have this book series called “The Little Book of“ Series, which like the Little Book of Common Sense investing is written by John Bogle. And I'm like, kidding, right? I get to write a book in series that that goes in. And actually the bigger one for me was actually The Little Book valuation is by Aswath Damodaran. Who, I don't know if you guys know him, but in my industry, he's a god.   Aswath Damodaran book bbout this thick on on, it's just got damodaran valuation. And it's got every way of valuing everything ever. And it's the Bible for my industry. Everyone's got a copy everyone's read it cover to cover. It's literally and it I mean, it's dense. He's I think he's a, he's a professor at NYU stern. And just like, super clever guy. So he wrote the little book of value valuation. And they're asking me 7 Dollar Millionaire if I want to write one of those. So I thought I've got to think about it. So just like so thinking about it. And I was like, still didn't want to write a follow up on investing. Now, I did literally woke up one morning, I was like, the little book of Zen Money. And just that the title just runs so nice. I was like, Yeah, okay, what, what can I do with that, and I was like, then the subtitle came to my head was like, okay, a simple path to financial peace of mind.   Okay. And literally, I'm writing the thing, first word to last word and like, not how you should write, you should break it up into bits. And Right, right, like the middle first, and then the end. And then the beginning. And I'm literally going from the title. And the last word, all right, will be the kind of the end. And just going that direction, because it just makes sense to me all the way through.   Tom: Yeah, it's there already. just pulling back.   Michael: Yeah, gotta get it onto paper.   7 Dollar Millionaire: I stay away from the other analogy. But the other analogy is chipping blocks off the stone, right to make a sculpture. That's what I'm doing with this one. It's there. It's already there. I've just got to find it. enough fun. Yeah, I wake up every morning and get at it part from today, when it's fun to talk to you guys instead.   Tom: Yeah, I mean, one of the takeaways also for these conversations is like, you know, this 80-20 principle where, you know, you get 80% of your value from 20% of the work and that last 20%, like, that's where it gets, like overly complicated moving targets, you know, anxiety, all that stuff, but just getting up and getting that initial blob of paint? I mean, I feel like I'm probably repeating a lot of the conversation, but it's a really powerful one.   7 Dollar Millionaire: Exactly. I mean, you know, it's it really is that that first move separates you from everyone who's not investing, who's not saving. That's it, right that if you were the stat or last year, it was ended. 2019. Right there, 61% of Americans didn't have $1,000 in an emergency fund.   Just having $1,000, that puts you already in the top 39% of the richest country in the world. That is already that that's the 80 20 rule right there. They're taking their money and opening an investing account, bang, you're probably in the top 10%. Right. And taking those actions is what moves you along these things all the time. That's why is is so important.   Yeah. It's the problem, as you said is, someone tells you, you should invest. Oh, and you should invest in this. So what you know, that's just way too complex. It should just be you should save, you should invest, and probably, you know, VTI just go there. He can be a while before you find anything else. So you can overcomplicate it later when you're ready to overcomplicate it, but to start with just go there.   Michael: Love it.   Tom: Love it. And VTi is the vanguard index fund. That's just kind of just blankets. The economy beautiful. Yeah, big fan.   7 Dollar Millionaire: It's, it's the it's the biggest economy in the world. It's the top 500 companies in the biggest economy in the world. You know, when we if you live off grid, you're not involved in the global economy. Fine, right. But that's like naught point naught naught 1% of us that's discussing this properly off grid. The rest of us are buying stuff to live our off grid life anyway, we're in the economy. That's that the most natural hedge just by that.   Michael: And the folks that do live off grid probably aren't gonna be listening to this podcast on their iPhone, in the middle of nowhere wherever they live off grid, so I don't think we have to worry about them.   7 Dollar Millionaire: They probably are.   Michael: Living off grid with faster Wi Fi than any of us.   7 Dollar Millionaire: Exactly.   Michael: Awesome. Well, $7 millionaire Always a pleasure to have you on thank you again for hanging out with us and bestowing some wisdom. And like I mentioned, and I mentioned very much looking forward to the book when it comes out. I know I'll be getting it. We will both be getting it I'm sure.   7 Dollar Millionaire: Excellent. Well, thank you very much. It really it's always a pleasure. Really good fun. Thanks, guys.   Michael: Awesome. Take care. I'll talk to you soon.   Alright, everybody, that was our episode a big big, big thank you to 7 Dollar Millionaire always such a pleasure chatting with him. Tom, I know you and I get so much value out of our talks with him and after all of our conversations, we have going making some changes to our own personal finance realm. So very excited to do that yet again. If you'd like the episode, please feel free to leave us a rating or review wherever it is just in your podcast. If you're checking this out on YouTube feel, feel free to hit that like and subscribe button. And as always, we look forward to seeing on the next one. Happy investing.   Tom: Happy investing.

Aufgschnappt
Aufgschnappt 40 Michael Well

Aufgschnappt

Play Episode Listen Later Jul 16, 2021 35:55


Vor einer kleinen Sommerpause gibt es ein Gespräch mit Michael Well, Musiker und Top-Manager von Gerhard Polt, den Well Brüdern (eh. Biermösl Blosn), Wellküren u.a. Wir sprechen über die Lage der Kultur und über Aufgschnappt! Im Herbst geht es weiter - und ich freue mich über Sprachnachrichten per WhatsApp an 0163 2426359 oder Mail an claudia@well-musik.de Alles, was ihr mit Bayern verbindet, Vorurteile, Schönes, Schauriges oder was ihr Aufgschnappt schon immer mal sagen wolltet. Schönen Sommer! :)

Your Anxiety Toolkit
This is Your Anxiety Toolkit - Episode 189 with Mike Heady

Your Anxiety Toolkit

Play Episode Listen Later May 14, 2021 40:15


Welcome to Your Anxiety Toolkit. I’m your host, Kimberley Quinlan. This podcast is fueled by three main goals. The first goal is to provide you with some extra tools to help you manage your anxiety. Second goal, to inspire you. Anxiety doesn’t get to decide how you live your life. And number three, and I leave the best for last, is to provide you with one big, fat virtual hug, because experiencing anxiety ain’t easy. If that sounds good to you, let’s go. Hello friends, you are going to love this episode. Holy smokes, I just recorded it, so you’ve got me fresh, and I’m so excited. I just had such an amazing conversation with Mike Heady. He is an LCPC and he treats OCD and anxiety disorders. We talked about shame and shame and shame and shame, and he brought so much wisdom. You guys are going to love this episode. It is packed full of all the good stuff. So, I’m not going to waste your time. I just want you to get straight there and listen to it. Before we get started, if you haven’t left a review, please do so. I love getting reviews from you. When we get good reviews, it doesn’t just stroke my ego. That’s not the point. It is because the more reviews we get, the more people will come and listen to the podcast, which means then I get to help people with these incredible tools, these science-based tools. Hopefully, even just from today, if you’re first time listening, welcome. We are talking about shame, and you are going to get so much from this. So if you are listening, please do leave a review. I would be so grateful. And enjoy the show. ----- Kimberley: Welcome. I am so excited to have with us today, Mike Heady. He is an LCPC. That’s correct. Right? Michael: That is, yes. Kimberley: Yes. We’re going to have a conversation that actually might be my favorite topic in the whole of the podcast. We’re talking about shame. So, welcome. Michael: Thanks for having me. I share your passion for the conversation. Kimberley: Yes. Not that I love shame, but I like talking about shame. Michael: Yes. I agree. It’s hard to say you love shame. It’s like saying I love fear. Kimberley: Exactly. So, why are you interested in this topic? Michael: It’s been a professional evolution for me, originally being trained to treat anxiety disorders and OCD. We talk a lot about fear and uncertainty and we have a ceremonial way of responding to shame. We’re like, “Oh yeah, and there’s a shame too.” In the last couple of years, I’ve really done a deep dive into like, “Well, what is this?” Because a lot of clients are having a hard time getting better. I don’t think it’s the fear that’s hard for them to get past sometimes. I don’t think it’s the uncertainty. I think it’s the shame. I think it’s a different animal. When I started doing a lot of digging, I realized there’s a whole world of shame out there in the literature, and how it applies to OCD fascinated me. So, that’s my new passion project. Kimberley: Yeah. Same. Exact same experience. Also seeing how much fear in and of itself is a generator of suffering. But as you said, there’s this shame that’s generating suffering at exponential levels. So, I’m so grateful to have this conversation with you. for those who are listening and who might not really understand shame, would you be interested in giving me your working definition of what shame is? Michael: Sure. Are you okay if I elaborate on it a little bit? Kimberley: Yeah. Go for it. Michael: Okay. I think a good definition is that shame is a really painful, aversive, unpleasant emotional experience. Fear or disgust, it’s natural or instinctive for us to want to back away and get rid of shame. Shame is often brought on by some kind of real or perceived violation of a social norm that we actually believe in. So it’s not this mystical emotional thing. It’s a thing either real or perceived occurred. And then I experienced this negative, painful emotion of shame. That’s the short version of the definition. I think it’s worth talking about shame as having two levels of shame. We might call an adaptive kind of shame, the shame where we view it as a response to a specific episode, rather than some generalizable character flaw or full-on assault of our identity. I violated something I believed in, I feel bad, which is different than guilt because guilt is about apologizing to the other person for something you’ve done. But I might feel bad for violating a norm I believe in. Okay, there’s nothing toxic about that. There’s another level of shame that we tend to want to talk about more. It’s the toxic shame. That’s the shame that is unworkable. It’s always unhelpful. It is a response to a perceived or real violation of a norm that has broad sweeping characteristics to it. It is a full-on assault on our identity. It is a condemnation of the self. That’s the toxic shame. I can wrap up this as saying, what was incredibly helpful for me when I was going deep dive into what shame was is, yes, shame is an emotion. We know what emotions are. We all feel emotions. We’ve all felt shame. You and I, as therapists, spend our careers trying to help our clients have a different relationship towards painful emotions, and understanding what an emotion is, specifically around shame, I think was really enlightening for me. I derive a lot of this understanding from some work that occurred in the sixties and seventies, probably before then, but the work from the sixties and seventies is what brought it to my attention, that emotions are an emergent experience constructed by an interaction between our biology and our biography. The biography piece comes out of Silvan Tomkins work in the late sixties where he suggested that, yes, there’s a universal kind of biological experience that contributes to an emotion. But the part that completes it is our own narrative, which is unique to us. My interaction with the world, as I develop from a child to an adult, the experiences I have, my environment, that’s the secret ingredient to my shame. So what makes me feel shame isn’t necessarily what makes you feel shame. For instance, if I were to, while talking to you, suddenly break out into a red flush on my face, start sweating, and my voice start cracking, I might experience that as an embarrassment, like a small shame. But if you perhaps had terrible social anxiety disorder and the same thing happened to you, the same exact event, you might see that as a humiliation. Both are derivative emotions of shame. But humiliation is different from embarrassment in orders of magnitude of pain. Humiliation is closer to trauma than it is to anxiety. This is anyway my long-winded way of saying, yes, shame is a complex animal, and that’s the working definition I tend to have. Kimberley: Yeah. It’s a different way of explaining it. This opportunity makes me so happy. What you’re saying is, it’s on a spectrum, would you say? Michael: Oh, absolutely. Yeah. Kimberley: Now, let’s play that out. We’re talking about the biology, and then there’s the story we tell ourselves. Would you give an example for you? You and me, let’s say we both got embarrassed. Let’s say we both made a mistake or something. We embarrassed ourselves in front of each other, which is not going to happen here. But if we did, what might be a difference in the story we told each other which would indicate that higher level of shame or toxic shame? Michael: Sure. Let me clarify the story. It’s not just how we appraise the shame itself. That’s a part of it. But the story is like my upbringing. I was brought up in a blue-collar family. There wasn’t a lot of room for emotions, especially for the male members of the family. So if I encountered a situation where I felt vulnerable or sensitive or hurt, the expression of that emotion could be shut down. That expression of that emotion could be punished, ridiculed. Not that I was ridiculed, but it could have been. Someone’s narrative about a negative emotional experience could have been that and ongoing. They could have been bullied for being a sensitive kid, whereas you may not have. now you both may experience the same thing as a generic sense of shame. “I wasn’t the way I wanted to be. I wanted to be put together and intelligent and I made a stupid GAF, and I came across looking silly.” One kind of embarrassment for one is not necessarily the embarrassment for the other. That’s what I mean when I say “the narrative.” Kimberley: Yeah. Okay. This is wonderful. I think that maybe we want to take a look at, and I know I have a few questions. What I’d love to take a look at is, why would, let’s say someone feel shame for having a mental illness? Michael: Well, yeah, that’s a great question. I think there’s a whole lot of reasons why someone might feel shame. One of them could be, I feel shame because the mental illness – we can say OCD in particular since this is one of the things I primarily treat – is that the content of my obsessions themselves could have a taboo theme or they could be otherwise conceived as bizarre. That’s going to create a sense of “I shouldn’t have this thought, there’s something wrong with me I have this thought.” The helping field, in general, commonly misinterprets and doesn’t understand OCD. If you present this set of thoughts to them, you’re going to get a sense of judgment and rejection or humiliation, and that’s not made up fear. That’s a real fear. That stuff happens to people. That’s an example of how someone with a mental health issue can develop shame. It’s because they may have gotten that feedback or fear rightfully so that they would get that feedback. Another way of looking at it is just, “I shouldn’t have this because having this means I’m not working properly. I’m otherwise defective or broken.” It’s a silent problem for people – these emotional and psychological things. We have a lot more empathy and understanding for people with a physical problem than we do for someone who has a psychological or emotional problem. So, I think that there’s this built-in-- Kimberley: Stigma. Michael: Yes. Stigma. Right. Thanks. Yeah, exactly. And then there’s the people who’ve tried to get better. I’ve certainly seen a number of clients who’ve gone through years of therapy. They’ve worked diligently with great therapists, all very well-intentioned, and they failed to get better. “What’s wrong with me? I must be really broken.” I’m sure there’s countless other ways, but I’ll pass that off to you, I think. Kimberley: Yeah. I mean, I think these are all societal expectations that are placed on us. It’s funny, you brought up the question about the concept around being humiliated for having an emotion. Somebody had written a question like: How can I be considered “the man of the house” if I have anxiety? I mean, there’s so much shame in that question. There’s so much societal expectations in that question and stigma in that question. I think it’s definitely there, and I think you’re right. For the things that are unknown, I see that to be more shame. I think everybody understands sadness. So we don’t feel so much shame around it. But fear of harming your baby – let’s not talk about that. You know what I mean? Let’s push that down. Michael: Right. And not only because it’s universally taboo. We know that instinctually. We don’t need to really be told that. We know that, because that’s our response if we were to hear that from someone else. Until we have that intrusive thought ourselves and they’re like, “Oh, me too?” Shame, I think it’s distinguishing shame from the other negative emotions that people have, because I don’t think they’re all the same. Oh, negative emotions or negative emotions – let’s just learn how to handle them. Fear, that’s a tough one. But shame? Shame is the most painful. Kimberley: It’s ouch because it’s in silence too, I think. My thing I say all the time is that shame thrives in secrecy. One of the best things you could do is to tell it out loud. Michael: I was having a conversation with colleagues about this a couple of weeks ago, and someone brought up a slogan that comes from AA, which is, “We’re only as sick as our secrets.” It’s such a powerful message. The idea that speaking that secret allowed, speaking that shame aloud can be healing. Now it can also be traumatizing. We can probably get into that later in the episode. But I think that there’s discernment about how and who we share with, and us as therapists creating a space where that’s good and healthy for the person. But you’re right. Absolutely. The things that thrive in darkness are painful. Kimberley: Okay, so you have a client and they have just very typical symptoms of OCD, even if it’s very typical taboo, obsessions – this is for people listening – any disorder, depression, BFRB, eating disorders, how do you work with that shame with your patients? Michael: That’s a fantastic question. I’m always evolving on how I figure that out with a particular client. I think if I were to try to distill that down to something helpful to the listeners, I think as a therapist, it would start with the very first interaction I had with the client. The first contact is the first opportunity, probably the best opportunity to provide a safe space that’s understanding, validating, authentic so that the client can then experience this interpersonal interaction that they’re having with this therapist as welcoming towards disclosure of a secret or their shame. I think that that first contact is vital. You can come across as the kind of person they want to talk to and try to set the stage and make that an effort, build that therapeutic alliance, continue to work on a therapeutic alliance because if you don’t, it might be a lot harder to build the work to let them disclose that shame. And then from there, I think education about what shame is, like I brought up in the beginning, that shame can exist on this continuum, that there is actually an adaptive kind of shame. We don’t tend to talk about it. We don’t tend to see it because we talk about the toxic and the pathological shame, the one that keeps people stuck in hurt. Through that education, through a demystifying of it, I think, is incredibly valuable. I’ll talk about the compass of shame in a minute. I don’t want to steal all the time from you. It’s like I talk a lot. Kimberley: Go for it. No, do. Michael: I’ve been thinking about this in preparation for our conversation today. I was thinking like, how would I want to set up an ideal way of dealing with shame with a client and again, creating that therapeutic space that they’d want to share that. And then if we have this experience that once we hand our secret or shame over to another person like, “Here you go,” that’s what the clients are doing to us, they’re handing it to us. If we receive it and hold it with compassion and understanding, if we hold it with acceptance of them as a person, I think we introduced them to common humanity – one of the three things that show up with self-compassion, that common humanity – perhaps for the very first time in their life. Because this is such a secret, quiet problem, this might be the first time they’ve ever been met with common humanity and acceptance when they’ve revealed this. I think that’s immeasurably powerful for the client. I think it helps them create a healthy distance from that narrative that’s been telling them to keep it a secret, keep it a secret, or else you’ll get rejected. “Wait a minute. I wasn’t rejected.” Kimberley: Yeah. It normalizes it too. Right? Michael: Yeah. Kimberley: Sometimes when I hand over the why box that has all the different obsessions, that in of itself can be a shame killer because they’re like, “Oh my goodness, all of the things I have are right here on this piece of paper and you don’t seem alarmed at all.” Michael: Yeah. I’ve had email interactions with clients who are like, “Have you ever heard of this kind of presentation?” I’ll shoot them links to three books written about it. They’ve written entire books about this so you’re not alone. It’s so helpful for them. Kimberley: Yeah. Tell me about the compass. Michael: Yes. I was introduced to this through one of my mentors, and it really rang true for me as a useful concept. The compass of shame was developed in the 1980s by a psychiatrist by the name of Donald Nathanson. I don’t want to bore the audience with the history, but he researched shame basically that was his career. Nathanson had found through his research that there are four predictable and common unhelpful responses to shame. I’ll say toxic shame. We’re all talking about toxic shame. Those four represented the four points of a compass – north, south, east, and west. It doesn’t matter where they go. One of the points is withdrawal. Withdrawal is when we get quiet, silent, small. Like a dog who got caught chewing on the cash knows they did wrong. They get small, they get quiet. They try to disappear into the moment. That’s one common response to shame. Another one is avoidance, behavioral avoidance of situations and people and circumstances, but also through substances, through food, through sex, through anything that would be a direct response to a cue, “I’m going to avoid this feeling.” Then another part of it is to attack others. This shows up when you felt humiliated or embarrassed by someone else. Someone made you feel this way, so you’re going to lash out verbally or physically. In a sense, the way I think of it is in the sense of trying to balance the scales. “You’ve made me feel small and vulnerable and insignificant. I’m going to try to balance that out by making you feel the same way.” The last one I think by far the most common in the people that we’re going to be working with is attack the self. This is self-criticism, this is berating ourselves, self-condemnation, degrading ourselves. It’s often seen as “I’m going to be holding myself accountable for this failure real or perceived,” and that’s going to make it better, that there’s somehow a utility to this attacking self-response. But when you poke at it just a little bit, it’s completely unhelpful. It’s just a massive perpetuator of the problem. So, that’s Nathanson’s Compass of Shame. I think his point in bringing this up is, look, everyone’s toxic shame response is going to fall probably into one of those four. Where do yours? if we can bring awareness to that, maybe we can learn to pivot to a more functional or helpful response instead. Kimberley: Right. I think that that awareness, again, it’s validating and it’s normalizing the normal response to shame, which helps the shame, I think, in and of itself. Okay, so let’s play this out. If something happens, you’ve made a mistake or you’ve had a thought that you’ve deemed unacceptable, or you showed up in a way that created shame, you did all four of those things, what do we do from there? Or you did one of them. Now that we have this awareness, how might we meet shame instead in your thoughts, in your mind? Michael: I think hearing that from a client and I was watching it unfold in the moment, I might say, “Can we pause for just a minute? I think shame showed up for us.” He might even be able to see some of the behavioral changes in their eye contact and the postures. I think shame showed up. What are you doing with that right now? Because again, it’s silent. It’s not broadcasting this out loud. It’s silent. What are you doing? What’s going on in your mind? Probably reveal what you said, they did one or all four of those things – I would point that out, give it a name. We understand this process. This is somewhat of a predictable response. Can we hit the pause button and can we now make a choice to pivot to a different response. Pivot to what? Pivot to self-compassion maybe. That might be a teachable moment. What is self-compassion? Can I give you an experiential exercise on meeting this moment with self-compassion? I can model meeting this moment with you with compassion so you can see what that looks like and feels like. Instead of spending time in the head, in the verbal, in the ruminative come back to the feeling, because that’s what we’re trying to avoid. When we criticize ourselves, we’re trying to avoid and escape criticism, or using criticism to try to avoid and escape shame and humiliation. Okay, let’s come back to that. That’s painful. We can learn how to sit with that without having to beat ourselves up or escape it. I think people can sit with it in different ways. You can use it as an exposure opportunity for people who are feeling smaller kinds of shame, like embarrassment, like let’s do some exposure towards what it feels like to be embarrassed. If we’re dealing with a much more painful kind of shame, that humiliation kind of shame, let’s meet that with more direct self-compassion in this moment. I think it gets sticky a little bit when we introduce self-compassion, if we haven’t already introduced it, because like any intervention, it hinges on the client buying into it and thinking that they deserve to receive it. Kimberley: Right. I’ll give you my personal experience with this because I think, and I see a lot and I would add a fourth point to the compass, which is, now as you’re talking, I think this even different than what we talked about in previous conversations, just the two of us, is I think if I were really to track it, I think that another thing that I did when shame showed up is I swing into perfectionism. The stronger shame was, the more I would do good or be good. It’s an interesting reflection for me because I think the more I felt imperfect and the more shame that brought up, the more it’s like compulsive do good kind of thing, which I think again, might be why some of our clients get stuck around shame because there is that sort of self-punishment. “Well, I did a bad thing. Well, I have to neutralize that with a positive, good thing.” I don’t know. Just something I’m thinking about. Michael: No, I think that’s really great. I’m sure a lot of people listening are thinking right now, nodding their heads, “Yup, I go into perfectionism.” If I can channel Nathanson for a second, I imagine he would say, “That’s a type of avoidance. It’s an avoidant behavior. You’re doing this thing and it’s a compensation to numb, or to balance the scale.” If I do enough good, it cancels out the bad. The message is that that thing is intolerable to feel, and it’s not. Kimberley: Good catch. That’s true. It is. It’s like neutralizing the compulsion, right? Yeah. Okay. This is amazing. I have some questions from the audience that I think is a perfect segue, and there’s one that really hit me, really deepened my heart and I wanted to ask your opinion on. Somebody had asked, how do I manage shame for having symptoms? They didn’t express which ones, but I’m assuming it’s having symptoms of being a human of some respect. But I also have privilege and resources and the ability to get care, how do I manage shame when I have privilege? Michael: That’s a really great question. I think if I can flip that around a little bit, I can say that the cost of your privilege towards access to care, towards a good community of people, the cost of that isn’t more shame. We don’t want to shame ourselves for having opportunities. In a way, it moves you away from doing something about that, about that privilege. If you recognize I have privileged shaming yourself is useless. Who’s that for? That’s a silent response to try to balance out this. It’s an avoidance. It’s a running away from. So can we try to meet that? I’d say first with patients and then recognition, yeah, there is some privilege here and I feel bad about that, and then move into a “what’s next” kind of a mindset. Like, I still need to work on my own shame about having these symptoms. It’s not like I have to suddenly stop working on that because I also happen to have the privilege and the capacity to work on those. But I think we throw it into the same mix. It’s like, okay, so you’re shaming yourself. Which one of the four points of the compass are you doing now in recognition of a privilege? Once we get off of that unhelpful response, we can then maybe find a more helpful way to recognize the privilege, to speak out against the privilege, to prop other people up and help other people have access, things like that. But we can’t do that if we’re shaming ourselves, because shaming yourself, criticizing yourself, avoiding isn’t workable. Kimberley: Yeah. There’s so much of this like self-punishment involved as a response to shame. Like, okay, so I have this one privilege, so I must be punished for that before I can address the problem that I have almost. I’m so grateful that you answered that because I have seen that multiple times, many, many times with my patients and I’m guessing you too. You’ve talked about shame around lots of emotions. Interestingly, there were two very common questions, and I’ll leave these as the last two questions for you. There was a lot of questions around having shame for anger and there was a lot of questions around having shame for having a “groinal response,” which I’m assuming is in relation to some kind of sexual obsession or maybe even sexual orientation as well. Can you share your thoughts on those? Michael: Sure. Shame around anger, I think... I’m trying to interpret the question a little bit. I imagine it goes beyond just the feeling of being angry, but maybe the act of being aggressive, if I can make some interpretation there. I helped the client recognize that anger, like any other emotion, is universal. It’s an emergent experience. It’s not really up to you about whether you get angry or not. We don’t have to act on the anger. We don’t have to become aggressive either passively or physically aggressive about it. So, teaching them that there is some workability in our response to anger and that if we accept anger as an emotion, if we make room for anger as an emotion, we don’t need to have a response to it in the same kind of way. We can let it in. Susan David, in one of her Ted Talks, she said that emotions are data, not directives. I love it. Super helpful way of organizing your thoughts around that. It’s just, let the emotion be data. It’s if you’re responding to something in your life, something happened that it shouldn’t have happened and it wasn’t fair, and then you felt angry. Okay, I understand that process. I don’t need to do something about it to get rid of it because there’s that relationship to an emotion that can be unhelpful. Now I have to find a way to control or get rid of it. Notice we only do that with the negative side of emotions. We don’t tend to be like, “I have to get rid of my joy.” Kimberley: Too much joy. Michael: Too much joy. Kimberley: Unless we feel privileged, so then we’re not allowed to have too much joy. Michael: Right. Yeah. In response to the groinal stuff, I think, again, it comes down to your biological, your physiological, your groinal response isn’t really up to you. I think Emily Nagoski does a really great job in her talk about unwanted arousal, and such a powerful Ted Talk and really great education around that. Your body’s going to respond, whether you like it to or not. I used to joke around and say, the reason why the 13-year-old boy isn’t standing up at the end of Spanish class is because he wants to get more lessons. It’s because he’s waiting to not be embarrassed when he stands up. It’s not that he’s attracted to Spanish as a language –maybe he is – it’s because he had a response and it wasn’t really up to him. Okay, so bodies respond to things. Can we separate that out from the thing that was in our mind? Bodies respond to sex generically. It doesn’t matter who it’s with, what it is. Just the idea of it, the notion of it, the hint, and it response. So even people listening to us now, using the words like sex, might respond to the word, and that doesn’t mean you’re attracted to the word or to this podcast. Maybe you are, but it’s probably not. It’s that your body responded to things because of all these associative learning cues that are going on. That education is powerful. And then, of course, I treat shame the way I treat any toxic shame, which is, the response to it is the biggest problem that needs to try to meet it with something a little bit more akin to self-compassion and common humanity. Kimberley: I love it. Thank you. Oh, you nailed it. Is there anything else you want to share? Michael: I mean, not off the top of my head. I’m sure that we could dive into so many different rabbit holes on the subject, but I think this was a good intro to it. Kimberley: Yeah. Intro, but also with depth. I’m really grateful. I love to give as many applicable tools as we can. I feel like there is some better understanding. The compass is so good. It’s so helpful to be able to deconstruct it that way. Michael: Yeah. That was a game-changer for me when I heard about that too. I will add a couple of things, just in passing other ways of therapeutically addressing shame. Once we’ve agreed that those four points in the compass are not the way we want to handle it, we have to have a new way. There’s a, what used to be, I think, a Broadway show called Get Mortified. It’s now a podcast, and it’s people sharing humiliating and mortifying personal stories. Again, this is going out to strangers and this is an idea that I’m normalizing these experiences in my life. Maybe someone else can relate to it and maybe we can bring some humor to it. It’s not about making fun of the person or the situation, it’s about saying, can we all just laugh at the fact that we’re busy concealing something that is so universal and ubiquitous. Kimberley: Yup. Life happens, right? It doesn’t go to plan. Michael: Yeah. I think that’s the other piece. Once you’re ready for it, humor is hard to think of a more helpful response to shame. Kimberley: I’m holding back every urge right now to be like, “What’s the most mortifying thing that’s ever happened to you?” Michael: That’s a different podcast. Kimberley: I was once on a podcast where he asked that, a very similar question. It was on OCD and he asked me a similar question. I think I completely went into your shame compass, like all the things, “What can I do to avoid this conversation?” Michael: Yes, yes. I think that would be like a few cocktails and we’re going to record a podcast and maybe we can talk about that. But again, you can see, you can notice how even here, I could easily come up with two very shaming experiences in my life, and the difficulty of sharing that when I think that other people are listening to it. Why should I care? It’s because it’s a painful emotion. So even us therapists have a lot of work to do with personally so that we can show up with the client in a way that’s helpful. Kimberley: Right. When I was doing one of the Mindful Self-compassion intensives, this is with Kristin Neff and Christopher Germer, one of the activities where we had to stop and do activity with the puzzle we came with if you came with someone. And then you had to turn to a person you didn’t know, and you had to tell them one of the most painful things that’s ever happened to you. They didn’t really give you a lot of choices either. They were like, you’re here, you’re going to do it. The whole act was there was tears everywhere, flying across the room. But the thing was then, the person who’s listening was not allowed to say anything, except “Thank you for sharing.” It was so powerful. It was so powerful. They weren’t allowed to say, oh. You weren’t allowed to touch them. You weren’t allowed to say anything, except “Thank you for sharing.” Michael: And again, an immeasurably effective and important thing. That wasn’t self-compassion. That was compassion, right? This is why I think like you with your Instagram work and people like Chrissie Hodges and OCD peers, and anyone who’s an advocate for OCD that is building a community of people where they can interact like OCD has a community of people. These communities allow other people who are struggling with OCD to interact with each other. You create this group acceptance. The group has accepted you in, shame and all. You no longer need to conceal or keep secret this thing. The weight, the anvil that gets lifted off your shoulders, you no longer have to be weighted in the past. It’d be nice if we could generalize that outside of an OCD community and just say, the community at large has now been sufficiently educated about what OCD is and isn’t, what depression is and isn’t, what eating disorders are and are not, trauma, so we can be a lot more understanding of one another. Perhaps that’s a little Pollyanna-ish to hope for, but I think that that’s the direction we should head on. Kimberley: That’s the mission. Yeah. Well, I actually think that this is a perfect place for us to end because I think that that is where we’re at. That common humanity, we all have it. You’re not alone. Yes, it’s the most painful thing you’ll feel. You’ll feel like your heart is breaking at the time. All of these things are so normal and part of being a human. So I love that that’s where we’re at. Thank you. Michael: Thank you for indulging the conversation. Kimberley: Easily, so easily. Tell us about where people can hear more about you and know about you. Michael: Sure. As you mentioned, my name is Mike Heady. I’m the Co-Director of the Anxiety and Stress Disorders Institute of Maryland. I work with my other Co-Director, Dr. Sarah Crawley, who’s a Child and Adolescent Psychologist. The Executive Director and Founder is Dr. Sally Winston. She’s written a number of books on OCD. We’re in Baltimore, Maryland. We’re an outpatient, private group practice. We have over 20 clinicians that specialize in depression, OCD, anxiety disorders, and other related conditions. Yeah, that’s us. That’s me. Kimberley: Amazing. Well, thank you. I really am grateful. I feel so calm after these conversations too because I feel like it’s the more you guess, you get to settle into it. So thank you. I’m so grateful personally, and for the community here, who sounded like they were very excited about this episode. Michael: Well, thank you for having me on. Kimberley: My pleasure. ----- Please note that this podcast or any other resources from cbtschool.com should not replace professional mental health care. If you feel you would benefit, please reach out to a provider in your area. Have a wonderful day, and thank you for supporting cbtschool.com.

Greater Than Code
234: Civil Society and Community Relationships with Michael Garfield

Greater Than Code

Play Episode Listen Later May 12, 2021 61:10


02:13 - Michael’s Superpower: Being Able to Creatively Digest and Reconstruct Categories * Integral Theory (https://en.wikipedia.org/wiki/Integral_theory_(Ken_Wilber)) * Creative Deconstruction – Michael Schwartz (https://ideas.repec.org/f/psc306.html) * Creating Truly Novel Categories – Recognizing Novelty as Novelty 09:39 - Recognizing Economic Value of Talents & Abilities * Invisible Labor * Ecosystem Services * Biodiversity; The Diversity Bonus by Scott Page (https://www.amazon.com/Diversity-Bonus-Knowledge-Compelling-Interests/dp/0691176884) 18:49 - The Edge of Chaos; Chaos Theory (https://en.wikipedia.org/wiki/Chaos_theory) * “Life exists at the edge of chaos.” 23:23 - Reproducibility Crisis and Context-Dependent Insight 28:49 - What constitutes a scientific experiment? * Missed Externalities * Scholarly articles for Michelle Girvan "reservoir computing" (https://scholar.google.com/scholar?q=Michelle+Girvan+reservoir+computing&hl=en&as_sdt=0&as_vis=1&oi=scholart) * Non-conformity 38:03 - The Return of Civil Society and Community Relationships; Scale Theory * Legitimation Crisis by Juergen Habermas (https://www.amazon.com/Legitimation-Crisis-Juergen-Habermas/dp/0807015210) * Scale: The Universal Laws of Life and Death in Organisms, Cities and Companies by Geoffrey West (https://www.amazon.com/Scale-Universal-Organisms-Cities-Companies-ebook/dp/B010P7Z8J0) 49:28 - Fractal Geometry More amazing resources from Michael to check out: Michael Garfield: Improvising Out of Algorithmic Isolation (https://blog.usejournal.com/improvising-out-of-algorithmic-isolation-7ef1a5b94697?gi=e731ad1488b2) Michael Garfield: We Will Fight Diseases of Our Networks By Realizing We Are Networks (https://michaelgarfield.medium.com/we-will-fight-diseases-of-our-networks-by-realizing-we-are-networks-7fa1e1c24444) Reflections: Jacob: Some of the best ideas, tv shows, music, etc. are the kinds of things that there’s not going to be an established container. Rein: “Act always so as to increase the number of choices.” ~ Heinz von Foerster Jessica: Externality. Recognize that there’s going to be surprises and find them. Michael: Adaptability is efficiency aggregated over a longer timescale. This episode was brought to you by @therubyrep (https://twitter.com/therubyrep) of DevReps, LLC (http://www.devreps.com/). To pledge your support and to join our awesome Slack community, visit patreon.com/greaterthancode (https://www.patreon.com/greaterthancode) To make a one-time donation so that we can continue to bring you more content and transcripts like this, please do so at paypal.me/devreps (https://www.paypal.me/devreps). You will also get an invitation to our Slack community this way as well. Transcript: JACOB: Hello and welcome to Episode 234 of Greater Than Code. My name is Jacob Stoebel and I’m joined with my co-panelist, Rein Henrichs. REIN: Thanks, Jacob and I’m here with my friend and co-panelist, Jessica Kerr. JESSICA: Thanks, Rein and today, I’m excited to introduce our guest, Michael Garfield. He’s an artist and philosopher and he helps people navigate our age of accelerating weirdness and cultivate the curiosity and play we need to thrive. He hosts and produces two podcasts, The Future Fossils Podcast & The Santa Fe Institute's Complexity Podcast. Yay, complexity! Michael acts as interlocutor for a worldwide community of artists, scientists, and philosophers—a practice that feeds his synthetic and transdisciplinary “mind-jazz” performances in the form of essay, avant-guitar music, and painting! You can find him on Bandcamp, it’s pretty cool. Refusing to be enslaved by a single perspective, creative medium, or intellectual community, Michael walks through the walls between academia and festival culture, theory and practice. Michael, welcome to Greater Than Code! MICHAEL: Thanks! I’m glad to be here and I hope that I provide a refreshingly different guest experience for listeners being not a coder in any kind of traditional sense. JESSICA: Yet you’re definitely involved in technology. MICHAEL: Yeah, and I think the epistemic framing of programming and algorithms is something that can be applied with no understanding of programming languages as they are currently widely understood. It’s just like design is coding, design of the built environment, so. JESSICA: And coding is a design. MICHAEL: Indeed. JESSICA: Okay, before we go anywhere else, I did not prepare you for this, but we have one question that we ask all of our guests. What is your superpower and how did you acquire it? MICHAEL: I would like believe that I have a superpower in being able to creatively digest and reconstruct categories so as to drive new associations between them for people and I feel like I developed that studying integral theory in grad school. I did some work under Sean Esbjörn-Hargens at John F. Kennedy University looking at the work of and work adjacent to Ken Wilber, who was trying to come up with a metatheoretical framework to integrate all different domains of human knowledge. All different types of inquiry into a single framework that doesn't attempt to reduce any one of them to any other and then in that process, I learned what one of my professors, Michael Schwartz, called creative deconstruction. So showing how art can be science and science can be art and that these aren't ontologically fixed categories that exist external to us. Looking at the relationship between science as a practice and spiritual inquiry as a practice and that kind of thing. So it's an irreverent attitude toward the categories that we've constructed that takes in a way a cynical and pragmatic approach to the way that we define things in our world. You know. REIN: Kant was wrong. [laughs] MICHAEL: It's good to get out of the rut. Obviously, you’ve got to be careful because all of these ideas have histories and so you have to decide whether it's worth trying to redefine something for people in order to open up new possibilities in the way that these ideas can be understood and manipulated. It's not, for example, an easy task to try and get people to change their idea about what religion is. [laughs] JESSICA: Yeah. More than redefined. It's almost like undefined. MICHAEL: Hm. Like Paul Tillich, for example. Theologian Paul Tillich said that religion is ultimate concern. So someone can have a religion of money, or a religion of sex, but if you get into these, if you try to interpose that in a debate on intelligent design versus evolutionary theory, you'll get attacked by both sides. JESSICA: [chuckles] That’s cosmology. MICHAEL: Yeah. So it's like – [overtalk] JESSICA: Which is hard to [inaudible] of money, or sex. MICHAEL: Yeah, but people do it anyhow. JESSICA: [laughs] Yeah. So deconstructing categories and seeing in-between things that fits through your walking through walls, what categories are you deconstructing and seeing between lately? MICHAEL: Well, I don't know, lately I've been paying more attention to the not so much tilting after the windmills of this metamorphic attitude towards categories, but looking at the way that when the opportunity comes to create a truly novel category, what are the forces in play that prevent that, that prevent recognizing novelty as novelty that I just – JESSICA: Do you have any examples? MICHAEL: Yeah, well, I just saw a really excellent talk by UC Berkeley Professor Doug Guilbeault, I think is how you say his name. I am happy to link his work to you all in the chat here so that you can share it. JESSICA: Yeah, we’ll link that in the show notes. MICHAEL: He studies category formation and he was explaining how most of the research that's been done on convergent categorization is done on established categories. But what happens when you discover something truly new? What his research shows is that basically the larger the population, the more likely it is that these categories will converge on something that's an existing category and he compared it to island versus mainland population biogeography. So there's a known dynamic in evolutionary science where genetic drift, which is just this random component of the change in allele frequencies in a population, the larger the population, the less likely it is that a genetic mutation that is otherwise neutral is going to actually percolate out into the population. On an island, you might get these otherwise neutral mutations that actually take root and saturate an entire community, but on the mainland, they get lost in the noise. You can look at this in terms of how easy it is for an innovative, artistic, or musical act to actually find any purchase. Like Spotify bought the data analysis company, The Echo Nest, back in 2015 and they ran this study on where emergent musical talent comes from. It comes from places like Australia, the UK, and Iceland, because the networks are small enough. This is a finding that's repeated endlessly through studies of how to create a viral meme that basically, or another way – JESSICA: You mean a small enough pool to take hold? MICHAEL: Yeah. That basically big science and large social networks online and these other attempts, anywhere we look at this economies of scale, growing a given system, what happens is—and we were talking about this a little before we got on the call—as a system scales, it becomes less innovative. There's less energy is allocated to – JESSICA: In America? MICHAEL: Yeah. Bureaucratic overhead, latencies in the network that prevent the large networks from adapting, with the same agility to novel challenges. There's a lot of different ways to think about this and talk about this, but it basically amounts to, if you want to, you can't do it from the conservative core of an organization. You can't do it from the board of directors. JESSICA: Oh. MICHAEL: You have to go out onto – like why did they call it fringe physics? It's like, it is because it's on the fringe and so there's a kind of – JESSICA: So this would be like if you have like one remarkably lowercase agile team inside your enterprise, one team is innovating and development practices. They're going to get mushed out. Whereas, if you have one team innovating like that in a small company, it might spread and it might become dominant. MICHAEL: Yeah. I think it's certainly the case that this speaks to something I've been wondering about it in a broader sense, which is how do we recognize the economic value of talents and abilities that are like, how do we recognize a singular individual for their incompressible knowledge and expertise when they don't go through established systems of accreditation like getting a PhD? Because the academic system is such that basically, if you have an innovative contribution, but you don't have the credentials that are required to participate in the community of peer review, then people can't even – your contribution is just invisible. The same is true for how long it took, if you look at economic models, it took so long for economic models to even begin to start addressing the invisible labor of women in at home like domestic labor, or what we're now calling ecosystem services. So there's this question of – I should add that I'm ambivalent about this question because I'm afraid that answering it in an effective way, how do we make all of these things economically visible would just accelerate the rate at which the capitalist machine is capable of co-opting and exploiting all of these. [chuckles] REIN: Yeah. You also have this Scott Seeing Like a State thing where in order to be able to even perceive that that stuff is going on, it has to become standardized and you can't dissect the bird to observe its song, right? MICHAEL: Totally. So obviously, it took almost no time at all for consumer culture to commodify the psychedelic experience and start using to co-opt this psychedelic aesthetic and start using it in advertising campaigns for Levi's Jeans and Campbell Soup and that kind of thing. So it’s this question of a moving frontier that as soon as you have the language to talk about it, it's not the ineffable anymore. REIN: Yeah. MICHAEL: There's a value to the ineffable and there's a value to – it's related to this question of the exploitation of indigenous peoples by large pharmaceutical companies like, their ethnobotanical knowledge. How do you make the potential value of biodiversity, something that can be manufactured into medicine at scale, without destroying the rainforest and the people who live in it? Everywhere I look, I see this question. So for me, lately, it's been less about how do we creatively deconstruct the categories we have so much as it is, what is the utility of not knowing how to categorize something at all and then how do we fix the skewed incentive structures in society so as to value that which we currently do not know how to value. JESSICA: Because you don’t have a category for it. MICHAEL: Right. Like right now, maybe one of the best examples, even though this is the worst example in another way, is that a large fraction of the human genome has been patented by Monsanto, even though it has no known current biomedical utility. This is what Lewis Hyde in his book, Common as Air, called “the third enclosure” of the common. So you have the enclosure of the land that everyone used to be able to hunt on and then you have the enclosure of intellectual property in terms of patents for known utilities, known applications, and then over the last few decades, you're starting to see large companies buy their way into and defend patents for the things that actually don't – it's speculative. They're just gambling on the idea that eventually we'll have some use for this and that it's worth lawyering up to defend that potential future use. But it's akin to recognizing that we need to fund translational work. We need to fund synthesis. We need to fund blue sky interdisciplinary research for which we don't have an expected return on investment here because there's – JESSICA: It's one of those things that it’s going to help; you're going to get tremendous benefits out of it, but you can't say which ones. MICHAEL: Right. It's a shift perhaps akin to the move that I'm seeing conservation biology make right now from “let's preserve this charismatic species” to “let's do everything we can to restore biodiversity” rather than that biodiversity itself is generative and should be valued in its own regard so diverse research teams, diverse workplace teams. We know that there is what University of Michigan Professor Scott Page calls the diversity bonus and you don't need to know and in fact, you cannot know what the bonus is upfront. JESSICA: Yeah. You can't draw the line of causality forward to the benefit because the point of diversity is that you get benefits you never thought of. MICHAEL: Exactly. Again, this gets into this question of as a science communications staffer in a position where I'm constantly in this weird dissonant enters zone between the elite researchers at the Santa Fe Institute where I work and the community of complex systems enthusiasts that have grown up around this organization. It's a complete mismatch in scale between this org that has basically insulated itself so as to preserve the island of innovation that is required for really groundbreaking research, but then also, they have this reputation that far outstrips their ability to actually respond to people that are one step further out on the fringe from them. So I find myself asking, historically SFI was founded by Los Alamos National Laboratory physicists mostly that were disenchanted with the idea that they were going to have to research science, that their science was limited to that which could be basically argued as a national defense initiative and they just wanted to think about the deepest mysteries of the cosmos. So what is to SFI as SFI as to Los Alamos? Even in really radical organizations, there's a point at which they've matured and there are questions that are beyond the horizon of that which a particular community is willing to indulge. I find, in general, I'm really fascinated by questions about the nonlinearity of time, or about weird ontology. I'm currently talking to about a dozen other academics and para-academics about how to try and – I'm working, or helping to organize a working group of people that can apply rigorous academic approaches to asking questions that are completely taboo inside of academia. Questions that challenge some of the most fundamental assumptions of maternity, such as there being a distinction between self and other, or the idea that there are things that are fundamentally inaccessible to quantitative research. These kinds of things like, how do we make space for that kind of inquiry when there's absolutely no way to argue it in terms of you should fund this? And that's not just for money, that's also for attention because the demands on the time and attention of academics are so intense that even if they have interest in this stuff, they don't have the freedom to pursue it in their careers. That's just one of many areas where I find that this kind of line of inquiry manifesting right now. REIN: Reminds me a lot of this model of the edge of chaos that came from Packard and Langton back in the late 70s. Came out of chaos theory, this idea that there's this liminal transitionary zone between stability and chaos and that this is the boiling zone where self-organization happens and innovation happens. But also, that this zone is itself not static; it gets pushed around by other forces. MICHAEL: Yeah, and that's where life is and that was Langton's point, that life exists at the edge of chaos that it's right there at the phase transition boundary between what is it that separates a stone from a raging bonfire, or there’s the Goldilocks Zone kind of question. Yeah, totally. REIN: And these places that were at the edge of chaos that were innovative can ossify, they can move into the zone of stability. It's not so much that they move it's that, I don't know, maybe it's both. Where the frontier is, is constantly in motion. MICHAEL: Yeah, and to that point again, I tend to think about these things in a topographical, or geographical sense, where the island is growing, we're sitting on a volcano, and there's lots you can do with that metaphor. Obviously, it doesn't make sense. You can't build your house inside the volcano, right? [laughs] But you want to be close enough to be able to watch and describe as new land erupts, but at a safe distance. Where is that sweet spot where you have rigor and you have support, but you're not trapped within a bureaucracy, or an ossified set of institutional conventions? JESSICA: Or if the island is going up, if the earth is moving the island up until the coastline keeps expanding outward, and you built your house right on the beach. As in you’ve got into React when it was the new hotness and you learned all about it and you became the expert and then you had this great house on the beach, and now you have a great house in the middle of town because the frontier, the hotness has moved on as our massive technology has increased and the island raises up. I mean, you can't both identify as being on the edge and identify with any single category of knowledge. MICHAEL: Yeah. It's tricky. I saw Nora Bateson talking about this on Twitter recently. She's someone who I love for her subversiveness. Her father, Gregory Bateson, was a major player in the articulation of cybernetics and she's awesome in that sense of, I don't know, the minister's daughter kind of a way of being extremely well-versed in complex systems thinking and yet also aware that there's a subtle reductionism that comes in that misses – JESSICA: Misses from? MICHAEL: Well, that comes at like we think about systems thinking as it's not reductionist because it's not trying to explain biology in terms of the interactions of atoms. It acknowledges that there's genuine emergence that happens at each of these levels and yet, to articulate that, one of the things that happens is everything has to be squashed into numbers and so it’s like this issue of how do you quantify something. JESSICA: It's not real, if you can't measure it in numbers. MICHAEL: Right and that belies this bias towards thinking that because you can't quantify something now means it can't be quantified. JESSICA: You can’t predict which way the flame is going to go in the fire. That doesn't mean the fire doesn't burn. [chuckles] MICHAEL: Right. So she's interesting because she talks about warm data as this terrain, or this experience where we don't know how to talk about it yet, but that's actually what makes it so juicy and meaningful and instructive and – JESSICA: As opposed to taking it out of context. Leave it in context, even though we don't know how to do some magical analysis on it there. MICHAEL: Right, and I think this starts to generate some meaningful insights into the problem of the reproducibility crisis. Just as an example, I think science is generally moving towards context dependent insight and away from – even at the Santa Fe Institute, nobody's looking for a single unifying theory of everything anymore. It's far more illuminating, useful, and rigorous to look at how different models are practical given different applications. I remember in college there's half a dozen major different ways to define a biological species and I was supposed to get up in front of a class and argue for one over the other five. I was like, “This is preposterous.” Concretely, pun kind of intended, Biosphere 2, which was this project that I know the folks here at Synergia Ranch in Santa Fe at the Institute of Ecotechnics, who were responsible for creating this unbelievable historic effort to miniaturize the entire biosphere inside of a building. They had a coral reef and a rainforest and a Savannah and a cloud desert, like the Atacama, and there was one other, I forget. But it was intended as a kind of open-ended ecological experiment that was supposed to iterate a 100 times, or 50 times over a 100 years. They didn't know what they were looking for; they just wanted to gather data and then continue these 2-year enclosures where a team of people were living inside this building and trying to reproduce the entire earth biosphere in miniature. So that first enclosure is remembered historically as a failure because they miscalculated the rate at which they would be producing carbon dioxide and they ended up having to open the building and let in fresh air and import resource. JESSICA: So they learned something? MICHAEL: Right, they learned something. But that project was funded by Ed Bass, who in 1994, I think called in hostile corporate takeover expert, Steve Bannon to force to go in there with a federal team and basically issue a restraining order on these people and forcibly evict them from the experiment that they had created. Because it was seen as an embarrassment, because they had been spun in this way in international media as being uncredentialed artists, rather than scientists who really should not have the keys to this thing. It was one of these instances where people regard this as a scientific failure and yet when you look at the way so much of science is being practiced now, be it in the domains of complex systems, or in machine learning, what they were doing was easily like 20 or 30 years ahead of its time. JESSICA: Well, no wonder they didn’t appreciate it. MICHAEL: [chuckles] Exactly. So it's like, they went in not knowing what they were going to get out of it, but there was this tragic mismatch between the logic of Ed Bass’ billionaire family about what it means to have a return on an investment and the logic of ecological engineering where you're just poking at a system to see what will happen and you don't even know where to set the controls yet. So anyway. JESSICA: And it got too big. You talked about the media, it got too widely disseminated and became embarrassed because it wasn't on an island. It wasn't in a place where the genetic drift can become normal. MICHAEL: Right. It was suddenly subject to the constraints imposed upon it in terms of the way that people were being taught science in public school in the 1980s that this is what the scientific method is. You start with a hypothesis and it's like what if your – JESSICA: Which are not standards that are relevant to that situation. MICHAEL: Exactly. And honestly, the same thing applies to other computational forms of science. It took a long time for the techniques pioneered at the Santa Fe Institute to be regarded as legitimate. I'm thinking of cellular automata, agent-based modeling, and computer simulation generally. Steven Wolfram did a huge service, in some sense, to the normalization of those things in publishing A New Kind of Science, that massive book in whatever it was, 2004, or something where he said, “Look, we can run algorithmic experiments,” and that's different from the science that you're familiar with, but it's also setting aside for a moment, the attribution failure that that book is and acknowledging who actually pioneered A New Kind of Science. [chuckles] JESSICA: At least it got some information out. MICHAEL: Right. At least it managed to shift the goalpost in terms of what the expectations are; what constitutes a scientific experiment in the first place. JESSICA: So it shifted categories. MICHAEL: Yeah. So I think about, for example, a research that was done on plant growth in a basement. I forget who it was that did this. I think I heard this from, it was either Doug Rushkoff, or Charles Eisenstein that was talking about this, where you got two completely different results and they couldn't figure out what was going on. And then they realized that it was at different moments in the lunar cycle and that it didn't matter if you put your plant experiment in a basement and lit everything with artificial bulbs and all this stuff. Rather than sunlight, rather than clean air, if you could control for everything, but that there's always a context outside of your context. So this notion that no matter how cleverly you try to frame your model, that when it comes time to actually experiment on these things in the real world, that there's always going to be some extra analogy you've missed and that this has real serious and grave implications in terms of our economic models, because there will always be someone that's falling through the cracks. How do we actually account for all of the stakeholders in conversations about the ecological cost of dropping a new factory over here, for example? It's only recently that people, anywhere in the modern world, are starting to think about granting ecosystems legal protections as entities befitting of personhood and this kind of thing. JESSICA: Haven’t we copyrighted those yet? MICHAEL: [laughs] So all of that, there's plenty of places to go from there, I'm sure. REIN: Well, this does remind me of one of the things that Stafford Beer tried was he said, “Ponds are viable systems, they’re ecologies, they're adaptive, they're self-sustaining. Instead of trying to model how a pond works, what if we just hook the inputs of the business process into the pond and then hook the adaptions made by the pond as the output back into the business process and use the pond as the controlling system without trying to understand what makes a pond good at adapting?” That is so outside of the box and it blows my mind that he was doing this, well, I guess it was the 60s, or whatever, but this goes well beyond black boxing, right? MICHAEL: Yeah. So there's kind of a related insight that I saw Michelle Girvan gave at Santa Fe Institute community lecture a few years ago on reservoir computing, which maybe most of your audience is familiar with, but just for the sake of it, this is joining a machine learning system to a source of analog chaos, basically. So putting a computer on a bucket of water and then just kicking the bucket, every once in a while, to generate waves so that you're feeding chaos into the output of the machine learning algorithm to prevent overfitting. Again, and again, and again, you see this value where this is apparently the evolutionary value of play and possibly also, of dreaming. There's a lot of good research on both of these areas right now that learning systems are all basically hill climbing algorithms that need to be periodically disrupted from climbing the wrong local optimum. So in reservoir computing, by adding a source of natural chaos to their weather prediction algorithms, they were able to double the horizon at which they were able to forecast meteorological events past the mathematic limit that had been proven and established for this. That is like, we live in a noisy world. JESSICA: Oh, yeah. Just because it’s provably impossible doesn't mean we can't do something that's effectively the same thing, that's close enough. MICHAEL: Right. Actually, in that example, I think that there's a strong argument for the value of that which we can't understand. [laughs] It's like it's actually important. So much has been written about the value of Slack, of dreaming, of taking a long walk, of daydreaming, letting your mind wander to scientific discovery. So this is where great innovations come from is like, “I'm going to sleep on it,” or “I'm going to go on vacation.” Just getting stuck on an idea, getting fixated on a problem, we actually tend to foreclose on the possibility of answering that problem entirely. Actually, there's a good reason to – I think this is why Silicon Valley has recognized the instrumental value of microdosing, incidentally. [laughs] That this is that you actually want to inject a little noise into your algorithm and knock yourself off the false peak that you've stranded yourself on. JESSICA: Because if you aim for predictability and consistency, if you insist on reasonableness, you'll miss everything interesting. MICHAEL: Or another good way to put it is what is it, reasonable women don't make history. [laughs] There is actually a place for the – JESSICA: You don’t change the system by maximally conforming. MICHAEL: Right. JESSICA: If there is a place for… MICHAEL: It’s just, there is a place for non-conformity and it's a thing where it's like, I really hope and I have some optimism that what we'll see, by the time my daughter is old enough to join the workforce, is that we'll see a move in this direction where non-conformity has been integrated somehow into our understanding of how to run a business that we actively seek out people that are capable of doing this. For the same reason that we saw over the 20th century, we saw a movement from one size fits all manufacturing to design your own Nike shoes. There's this much more bespoke approach. JESSICA: Oh, I love those. MICHAEL: Yeah. So it's like we know that if we can tailor our systems so that they can adapt across multiple different scales, that they're not exploiting economies of scale that ultimately slash the redundancy that allows an organization to adapt to risk. That if we can find a way to actually generate a kind of a fractal structure in the governance of organizations in the way that we have reflexes. The body already does this, you don't have to sit there and think about everything you do and if you did, you’d die right away. JESSICA: [laughs] Yeah. REIN: Yeah. MICHAEL: If you had to pass every single twitch all the way up the chain to your frontal cortex JESSICA: If we had to put breathe on the list. [laughs] MICHAEL: Right. If you had to sit there and approve every single heartbeat, you'd be so dead. [overtalk] JESSICA: Oh my gosh, yeah. That's an energy allocation and it all needs to go through you so that you can have control. REIN: I just wanted to mention, that reminded me of a thing that Klaus Krippendorff, who's a cybernetics guy, said that there is virtue in the act of delegating one's agency to trustworthy systems. We're talking, but I don't need to care about how the packets get from my machine to yours and I don't want to care about that, but there's a trade-off here where people find that when they surrender their agency, that this can be oppressive. So how do we find this trade-off? MICHAEL: So just to anchor it again in something that I find really helpful. Thinking about the way that convenience draws people into these compacts, with the market and with the state. You look over the last several hundred years, or thousand years in the West and you see more and more of what used to be taken for granted as the extent in terms of the functions that are performed by the extended family, or by the neighborhood, life in a city, by your church congregations, or whatever. All of that stuff has been out boarded to commercial interests and to federal level oversight, because it's just more efficient to do it that way at the timescales that matter, that are visible to those systems. Yet, what COVID has shown us is that we actually need neighborhoods that suddenly, it doesn't – my wife and I, it was easy to make the decision to move across country to a place where we didn't know anybody to take a good job. But then suddenly when you're just alone in your house all the time and you've got nobody to help you raise your kids, that seems extremely dumb. So there's that question of just as I feel like modern science is coming back around to acknowledging that a lot of what was captured in old wives’ tales and in traditional indigenous knowledge, ecological knowledge systems that were regarded by the enlightenment as just rumor, or… JESSICA: Superstition. MICHAEL: Superstition, that it turns out that these things actually had, that they had merit, they were evolved. JESSICA: There was [inaudible] enough. MICHAEL: Right. Again, it wasn't rendered in the language that allowed it to be the subject of quantitative research until very recently and then, suddenly it was and suddenly, we had to circle back around. Science is basically in this position where they have to sort of canonize Galileo, they're like, “Ah, crap. We burned all these witches, but it turns out they were right.” There's that piece of it. So I think relatedly, one of the things that we're seeing in economist samples and Wendy Carlin have written about this is the return of the civil society, the return of mutual aid networks, and of gift economies, and of the extended family, and of buildings that are built around in courtyards rather than this Jeffersonian everyone on their own plot of land approach. That we're starting to realize that we had completely emptied out the topsoil basically of all of these community relationships in order to standardize things for a mass big agricultural approach, that on the short scale actually does generate greater yield. It's easier to have conversations with people who agree with you than it is – in a way, it's inexpedient to try and cross the aisle and have a conversation with someone with whom you deeply and profoundly disagree. But the more polarized we become as a civilization, the more unstable we become as a civilization. So over this larger timescale, we actually have to find ways to incentivize talking to people with whom you disagree, or we're screwed. We're kicking legs out from under the table. REIN: At this point, I have to name drop Habermas because he had this idea that there were two fundamental cognitive interests that humans have to direct their attempts to acquire knowledge. One is a technical interest in achieving goals through prediction and control and the other is a practical interest in ensuring mutual understanding. His analysis was that advanced capitalist societies, the technical interest dominates at the expense of the practical interest and that knowledge produced by empirical, scientific, analytic sciences becomes the prototype of all knowledge. I think that's what you're talking about here that we've lost touch with this other form of knowledge. It's not seen as valuable and the scientific method, the analytical approaches have come to dominate. MICHAEL: Yeah, precisely. [laughs] Again, I think in general, we've become impoverished in our imagination because again, the expectations, there's a shifting baseline. So what people expect to pull out of the ocean now is a fish that you might catch off just a commercial, or a recreational fishing expedition. It's a quarter of the size of the same species of fish you might've caught 50, 70 years ago and when people pull up this thing and they're like, “Oh, look at –” and they feel proud of themselves. I feel like that's what's going on with us in terms of our we no longer even recognize, or didn't until very recently recognize that we had been unwittingly colluding in the erosion of some very essential levels of organization and human society and that we had basically sold our souls to market efficiency and efficient state level governance. Now it's a huge mess to try and understand. You look at Occupy Wall Street and stuff like that and it just seems like such an enormous pain in the ass to try and process things in that way. But it's because we're having to relearn how to govern neighborhoods and govern small communities and make business decisions at the scale of a bioregion rather than a nation. JESSICA: Yeah. It's a scale thing. I love the phrase topsoil of community relationships, because when you talk about the purposive knowledge that whatever you call it, Rein, that is goal seeking. It's like the one tall tree that is like, “I am the tallest tree,” and it keeps growing taller and taller and taller, and it doesn't see that it's falling over because there's no trees next to it to protect it from the wind. It's that weaving together between all the trees and the different knowledge and the different people, our soul is there. Our resilience is there. REIN: Michael, you keep talking about scale. Are you talking about scale theory? MICHAEL: Yeah. Scaling laws, like Geoffrey West's stuff, Luis Bettencourt is another researcher at the University of Chicago who does really excellent work in urban scaling. I just saw a talk from him this morning that was really quite interesting about there being a sweet spot where a city can exist between how thinly it's distributed infrastructurally over a given area versus how congested it is. Because population and infrastructure scale differently, they scale at different rates than you get – REIN: If I remember my West correctly, just because I suspect that not all of our listeners are familiar with scale theory, there's this idea that there are certain things that grow super linearly as things scale and certain things that grow sub linearly. So for example, the larger a city gets, you get a 15% more restaurants, but you also get 15% more flu, but you also get 15% less traffic. MICHAEL: Yeah. So anything that depends on infrastructures scales sub linearly. A city of 2 million people has 185% the number of gas stations, but anything that scales anything having to do with the number of interactions between people scales super linearly. You get 115% of the – rather you get, what is it, 230%? Something like that. Anyway, it's 150%, it's 85% up versus 115% up. So patents, but also crime and also, just the general pace of life scale at 115% per capita. So like, disease transmission. So you get into these weird cases—and this links back to what we were talking about earlier—where people move into the city, because it's per unit. In a given day, you have so much more choice, you have so much more opportunity than you would in your agrarian Chinese community and that's why Shenzhen is basically two generations old. 20 million people and none of them have grandparents living in Shenzhen because they're all attracted to this thing. But at scale, what that means is that everyone is converging on the same answer. Everyone's moving into Shenzhen and away from their farming community. So you end up – in a way, it's not that that world is any more innovative. It's just, again, easier to capture that innovation and therefore, measure it. But then back to what we were saying about convergent categories and biogeography, it's like if somebody comes up with a brilliant idea in the farm, you're not necessarily going to see it. But if somebody comes up with the same brilliant idea in the city, you might also not see it for different reasons. So anyway, I'm in kind of a ramble, but. JESSICA: The optimal scale for innovation is not the individual and it's not 22 million, it's in between. MICHAEL: Well, I feel like at the level of a city, you're no longer talking about individuals almost in a way. At that point, you're talking about firms. A city is like a rainforest in which the fauna are companies. Whereas, a neighborhood as an ecosystem in which the fauna, or individual people and so, to equate one with the other is a potential point of confusion. Maybe an easier way to think about this would be multicellular life. My brain is capable of making all kinds of innovations that any cell, or organ in my body could not make on its own. There's a difference there. [overtalk] JESSICA: [inaudible]. MICHAEL: Right. It's easier, however, for a cell to mutate if it doesn't live inside of me. Because if it does, it's the cancer – [overtalk] JESSICA: The immune system will come attack it. MICHAEL: Right. My body will come and regulate that. JESSICA: Like, “You’re different, you are right out.” MICHAEL: Yeah. So it's not about innovation as some sort of whole category, again, it's about different kinds of innovation that are made that are emergent at different levels of organization. It's just the question of what kinds of innovation are made possible when you have something like the large Hadron Collider versus when you've got five people in a room around a pizza. You want to find the appropriate scale for the entity, for the system that's the actual level of granularity at which you're trying to look at the stuff, so. REIN: Can I try to put a few things together here in potentially a new way and see if it's anything? So we talked about the edge of chaos earlier and we're talking about scale theory now, and in both, there's this idea of fractal geometry. This idea that a coastline gets larger, the smaller your ruler is. In scale theory, there's this idea of space filling that you have to fill the space with things like capillaries, or roads and so on. But in the human lung, for example, if you unfurled all of the surface area, you'd fill up like a football field, I think. So maybe there's this idea that there's complexity that's possible, that’s made possible by the fractal shape of this liminal region that the edge of chaos. MICHAEL: Yeah. It's certainly, I think as basically what it is in maximizing surface area, like you do within a lung, then you're maximizing exposure. So if the scientific community were operating on the insights that it has generated in a deliberate way, then you would try to find a way to actually incorporate the fringe physics community. There's got to be a way to use that as the reservoir of chaos, rather than trying to shut that chaos out of your hill climbing algorithm and then at that point, it's just like, where's the threshold? How much can you invite before it becomes a distraction from getting anything done? When it's too noisy to be coherent. Arguably, what the internet has done for humankind has thrown it in completely the opposite direction where we've optimized entirely for surface area instead of for coherence. So now we have like, no two people seem to be able to agree on reality anymore. That's not useful either. REIN: Maybe there's also a connectivity thing here where if I want to get from one side of the city to the other, there are 50 different routes. But if I want to get from one city to another, there's a highway that does it. MICHAEL: Yeah, totally. So it's just a matter of rather than thinking about what allows for the most efficient decisions, in some sense, at one given timescale, it's how can we design hierarchical information, aggregation structures so as to create a wise balance between the demands on efficiency that are held at and maintained at different scales. SFI researcher, Jessica Flack talks about this in her work on collective computation and primate hierarchies where it’s a weird, awkward thing, but basically, there is an evolutionary argument for police, that it turns out that having a police system is preventing violence. This is mathematically demonstrable, but you also have to make sure that there's enough agency at the individual level, in the system that the police aren't in charge of everything going on. It's not just complex, it's complicated. [laughs] We've thrown out a ton of stuff on this call. I don't know, maybe this is just whetting people's appetite for something a little bit more focused and concise. JESSICA: This episode is going to have some extensive show notes. MICHAEL: Yeah. [chuckles] JESSICA: It's definitely time to move into reflections. JACOB: You were talking, at the very beginning, about Spotify. Like how, when unknown ideas are able to find their tribe and germinate. I was reading about how Netflix does business and it's very common for them to make some new content and then see how it goes for 30 days and then just kill it. Because they say, “Well, this isn't taking off. We're not going to make more of it,” and a lot of people can get really upset with that. There's definitely been some really great things out on Netflix that I'm like, for one on the one hand, “Why are you canceling this? I really wanted more,” and it seems like there's a lot of the people that do, too. What that's making me think about as well for one thing, I think it seems like Netflix from my experience, is not actually marketing some of their best stuff. You would never know it’s there, just in the way of people to find more unknown things. But also, I'm thinking about how just generally speaking some of the best ideas, TV shows, music, whatever are the kinds of things that there's not going to be an established container, group of people, that you can say, “We want to find white men ages 25 to 35 and we're going to dump it on their home screen because if anyone's going to like it, it's them and if they do, then we keep it and if they don't move, we don't.” I feel like the best things are we don't actually know who those groups are going to be and it's going to have a weird constellation of people that I couldn't actually classify. So I was just thinking about how that's an interesting challenge. JESSICA: Sweet. Rein, you have a thing? REIN: Yeah. I have another thing. I was just reminded of von Foerster, who was one of the founders of Second-order cybernetics. He has an ethical imperative, which is act always so as to increase the number of choices. I think about this actually a lot in my day-to-day work about maximizing the option value that I carry with me as I'm doing my work, like deferring certain decisions and so on. But I think it also makes sense in our discussion as well. JESSICA: True. Mine is about externalities. We talked about how, whatever you do, whatever your business does, whatever your technology does, there's always going to be effects on the world on the context and the context of the context that you couldn't predict. That doesn't mean don't do anything. It doesn't mean look for those. Recognize that there's going to be surprises and try to find them. It reminds me of sometimes, I think in interviewing, we’re like, “There are cognitive biases so in order to be fair, we must not use human judgment!” [laughter] Which is not helpful. I mean, yes, there are cognitive biases so look for them and try to compensate. Don't try to use only something predictable, like an algorithm. That's not helpful. That's it. MICHAEL: Yeah. Just to speak to a little bit of what each of you have said, I think for me, one of the key takeaways here is that if you're optimizing for future opportunity, if you're trying to—and I think I saw MIT defined intelligence in this way, that AI could be measured in terms of its ability to – AGI rather could be measured in terms of its ability to increase the number of games steps available to it, or options available to it in the next step of an unfolding puzzle, or whatever. Superhuman AGI is going to break out of any kind of jail we try to put it in just because it's doing better at this. But the thing is that that's useless if we take it in terms of one spaciotemporal scale. Evolutionary dynamics have found a way to do this in a rainforest that optimizes biodiversity and the richness of feeding relationships in a food web without this short-sighted quarterly return maximizing type of approach. So the question is are you trying to create more opportunities for yourself right now? Are you trying to create more opportunities for your kids, or are you trying to transcend the rivalrous dynamics? You've set yourself up for intergenerational warfare if you pick only one of those. The tension between feed yourself versus feed your kids is resolved in a number of different ways in different species that have different – yeah. It is exactly, Rein in the chat you said, it reminds you of the trade-off between efficiency and adaptability and it's like, arguably, adaptability is efficiency aggregated when you're looking at it over a longer timescale, because you don't want to have to rebuild civilization from scratch. So [chuckles] I think it's just important to add the dimension of time and to consider that this is something that's going on at multiple different levels of organization at the same time and that's a hugely important to how we actually think about these topics. JESSICA: Thinking of scales of time, you’ve thought about these interesting topics for an hour, or so now and I hope you'll continue thinking about them over weeks and consult the show notes. Michael, how can people find out more about you? MICHAEL: I'm on Twitter and Instagram if people prefer diving in social media first, I don't recommend it. I would prefer you go to patreon.com/michaelgarfield and find future fossils podcasts there. I have a lot of other stuff I do, the music and the art and everything feeds into everything else. So because I'm a parent and because I don't want all of my income coming from my day job, I guess Patreon is where I suggest people go first. [laughs] Thank you. JESSICA: Thank you. And of course, to support the podcast, you can also go to patrion.com/greaterthancode. If you donate even a dollar, you can join our Slack channel and join the conversation. It'll be fun. Special Guest: Michael Garfield.

iACast
iACast 156 - Go Big Or Go HomePod Mini

iACast

Play Episode Listen Later Mar 20, 2021 40:44


Show Description On this episode, Michael, Taylor, and Jason discuss Apple's discontinuation of the original HomePod, and iMac Pro. News Apple discontinues the original HomePod and iMac Pro. For more info, see the links in the show description. Evidence that supports the eminent a-rival of Apple's AirTags was Found in the Find My app in the iOS 14.5 beta. Hims has launched the BrailleSense 6. Google released the Android 12 technical preview. Ad iAccessibility app development services Picks Jason: TalkBack version 9.1. Taylor: GeneratePress Michael: The Expeditionary Force Book Series Providing Feedback We love hearing from you, so feel free to send an email to feedback@iaccessibility.net. You can follow us on Facebook, and Twitter. You can also find us on Reddit, and all around the web. Also, don't forget to check out our YouTube page, and for all things iACast, check out our iACast page. If you'd like to help support us, you can do so via our PayPal and Patreon pages. If you wish to interact with us during our podcasts live then please do join us on our Slack channel. Show Transcription MICHAEL: Hello, everyone and welcome to another episode of the IA cast. All right, with me today, I have the usual group. We have Taylor Arndt, TAYLOR: Hello, everyone, MICHAEL: and Jason Earls. JASON: Hello, everybody. MICHAEL: All right, we have a great episode for you today. And you know, we've been gone for a few weeks. We had a kind of a crazy storm And then we wanted to get back on a regular schedule. So, we're back with a new episode to talk about all the interesting news that's happened recently and some rumors and news and a bunch of different things that have happened. So, let's jump right into it. Our main topic for today is the first news item, and that's the HomePod being discontinued. And I have very mixed opinions on this. JASON: I do too. I kind of understand why Apple discontinued the HomePod. Also, they discontinued the HomePod! It's okay, HomePod buddy, I still love you! As I pat my HomePod. MICHAEL: Didn't we have a hashtag for a while, pet the HomePod? JASON: I think we did. TAYLOR: Hilarious. JASON: I was just trying not to pat the screen because I didn't want music to happen, but that would have actually been really funny. MICHAEL: I think I have a picture of headphones sitting on a HomePod. JASON: Oh, yeah! The Andrea Cans! MICHAEL: Yeah, yeah. JASON: But yeah, on one hand, I understand why they did it because it was at launch a what, $350 Smart speaker that couldn't do terribly much more than play music. I mean yes, it sounded good, But you know, it's not what people were looking for in their smart speakers. Especially considering the likes of the Echo devices, the Google Home Hubs or Homes at the time. And you know, the HomePod's been around for like 4 years. So, in one respect, I kind of understand it. And you know, the HomePod Mini does have some features that the big HomePod doesn't have regarding the U1 chip and everything. But at the same time, the HomePod does sound so good! And as good as the Mini is and as great sales figures as the Mini is because of its price point and everything, you can't argue that it just does not sound as good as the big HomePod. TAYLOR: Right. But I think if we're thinking about it, the majority of consumers, they may not be in depth with audio and they may not understand that the HomePod sounds the way it is and that they want to pay for that. Because a lot of them just want to listen to music, and they want it to be portable. And so, that's where I think it's coming down to. Like, I understand why they they discontinued it, but yeah, it's kind of sad. I mean personally, I don't have a big HomePod, but that's because in a small apartment, I just don't have a lot of room. JASON: Right. And, you know, they did say that they are still going to push out software updates for the big HomePods and support the Apple Care which is good because I just got Apple Care last year. TAYLOR: Oh, that would stink otherwise. JASON: Right? But like, I really want them to come out with a bigger HomePod for 199. That's what I'm hoping for, even though they publicly said to I think it was like iMore or whatever that they were in fact focusing their efforts on HomePod Mini. Because let's think about it like this, the big HomePod — you know, Apple slash the price to 299, right? So, for $200. You could get two HomePod mini for less money than one bigger HomePod. Now, that doesn't mean it's going to have the bigger, basier sound of the HomePod, but at least you would get stereo audio and stuff. MICHAEL: Well, let's leave this part for the end because we're already kind of diving in. JASON: I know right? I like, I got thoughts I'm sorry. MICHAEL: But the other bit of news is the iMac Pro completely was discontinued and they're only selling them while supplies last JASON:That I'm not sad about. MICHAEL: In a way, I am. I think it was a great product, but I think we're about to see something new come from Apple. And as usual, we will be doing a live stream of that event. At least that's the plan. We'll be doing a live stream of the Apple event when it happens later this month. Because we do know for certain, right, that there is an apple event? JASON: I don't think we do know for certain. I just think speculations hide that there may be one, at least last I checked. But March 23 is the rumored date for the Apple event. I also haven't really looked at the news today. So things may have changed. But last I knew it was a hypothetical thing at this point. I mean, a highly likely thing at this point. MICHAEL: And I think it's because they're discontinuing these devices and the fact that we have so much information in the code about our next topic, and that's potential AirTags coming soon. Because there's mention of them in the find my app. TAYLOR: Yes, there is. MICHAEL: On the beta TAYLOR: Which is awesome because I've saw YouTube videos. Obviously, I don't have the beta myself, but I've seen YouTube videos that have mentioned it. Obviously, when you're on to prepare for the podcast just kind of looking at all the news. And but yeah, definitely pretty cool. And hopefully, hopefully they work. I mean, Tile's nice, but it'd be nice to have something built in and integrated for finding stuff. JASON: Right, and I guess Apple's opening up the FindMy protocol so that companies like Tile could take advantage of it as well. And it's nice to see that they are opening up more of their frameworks and things. MICHAEL: Well, and I think that's because there's been so much blame for antitrust and things between them and Google and things like that, that they're trying to make sure that they stay open — JASON: ahead of that, Yeah. MICHAEL: Because Google's had a lot of problems with that because they're in everything. The last bit of news that we have is, and I won't make any jokes, Jason, I won't do it, I won't do it. Those will be left for off the podcast, the BrailleSense 6. And I only make this joke because if you want to learn more, head to hims-inc.com/bs.6 . And I'm not kidding. Take all the jokes from that you can. JASON: Exactly. MICHAEL: Basically, we have the BrailleSense 6, and it was announced this week at CSUN. From what I've been able to tell, it was one of the biggest announcements because there weren't a lot of announcements this week. And the BrailleSense 6 dropped the Polaris naming. And it's Android 10, 120 Gigs of hard drive space, 80211AC wireless, a battery that while under load will drain 21% in an hour and a half if doing the max amount of work. That's the only battery statistic we can get. It has SD card slot, it has two USBA ports, a two USBC ports, a headphone jack, supports microphone, The, what is that called, Jason? JASON: I think it's TRRS, actually, I believe is the technical standard which is basically what this microphone that I'm using is, which is, think the older headphone jacks on the iPhones or the the headphone jack on the Mac. So it's that single microphone combo jack. MICHAEL: And it has all that, it has new software installed. And the person doing the presentation was using Zoom on the BrailleSense. So that's pretty promising. The only concerns I have are if it's going to get Android 11 and up, and how well the software is going to work because the Polaris had a lot of issues with deleting documents and things like that. JASON: Yeah, the BrailleSense Polaris is a very interesting device. I think it also actually Michael, in addition to the headphone jack, I think they said it also has a stereo line in Port as well. So you could connect music things to it, you know, binaural microphones really would work I would imagine to it. MICHAEL: Nice! JASON: Did you mention that it has 6 Gigs of RAM? MICHAEL: No, I did not. TAYLOR: Nope, you didn't JASON: So yeah, it's got six Gigs of RAM, an 8 core CPU. I don't remember if they announced the clock speeds of it, but — MICHAEL: It didn't. JASON: So, it really does seem like a very interesting device and — MICHAEL: And it's gonna cost 5799, come out in June. TAYLOR: Yeah. Wow. That's a lot of money. JASON: So we do know, the battery will be user replaceable though because they talked about that at the CSUN announcement I think MICHAEL: they do offer financing and trade ins for your older devices, so those are options to get you a lot closer in price to those devices. So JASON: Yeah, it's a very interesting device. I do worry what the battery life is really going to be like, TAYLOR: Right, and also if it can — like some note takers have a problem where they fall behind mainstream. And so that's the other concern too, is that like, you buy the $6,000 device almost. Well, it's already running two versions behind of Android almost at this point. 12 is beta. So that's the other thing too. These notetakers I mean, they're great for what they are, but you know, it's a specialized thing, and they're not always up to date. JASON: Like I said to you guys, I think off the show, if I were to get a note taker, it would probably be the BrailleSense. You know, the BrailleSense 6. It's so weird that they don't have a name for it now. TAYLOR: I know. MICHAEL: Alright, you know, and we could have a whole episode on notetakers, but I think we would want to have somebody on that can talk more about Braille and mainstream versus notetaker because I think that would be a very cool discussion. So TAYLOR: Yes. JASON: Yeah, I do too. Because I mean, I've used the BrailleSense in the past, but the BrailleSense I used was, I think, even before the U2. So, it was definitely not any of the Android based BrailleSense devices. So MICHAEL: Another thing that's happened, the last news topic I really could think about, is Android 12 is in technical preview. We really haven't talked about that. And I hear it brings a whole lot of user interface changes, but not a lot of — you're not going to be able to notice it very much with Talkback. JASON: Yeah, that's true. I have been playing a little bit with the beta. After a couple false starts, I eventually got it on my Pixel. I accidentally installed the version of Android, that AOSP version, so it didn't actually have a screen reader which is why I wasn't getting speech. TAYLOR: Oh, no. How did you fix that? JASON: I pre flashed it — MICHAEL: Very carefully. JASON: I was — TAYLOR: Yeah, very carefully. JASON: Yeah, very carefully. So yeah, I reflashed it, because you can actually go to the Google developer site, and you can actually use their online flash tool, and it will basically do all the work for you MICHAEL: Online? That's cool! JASON: It downloads the image to the device, you have to enable some things like OAM Unlock, and whatnot, it'll download the image to the device, and it will tell you when it's safe to unplug your phone at which point it should be booting into the beta of Android. MICHAEL: That's fancy. JASON: I know. MICHAEL: And talk about the security implications there. I mean, it's Google, and they have all the security keys and all that. But could you imagine if somebody were to spoof that, and be able to put a knot legit version of Android from a website? JASON: Yeah, I know. I did actually think about that. And then I stopped thinking about it. TAYLOR: That might have been a good idea. JASON: But like I said, I do have Android 12 installed. I don't notice too much of a difference. Although honestly, my Pixels not my primary driver, my primary driver's my iPhone. So what I can say though, is that 12 does seem to be relatively stable. And along with the introduction of Talkback 9.1 which is not specific to Android 12, I do think that the Android experience is going to improve a bit which is nice and awesome to see. MICHAEL: Yeah. So, it's really cool that, you know, we have the ability to flash these devices remotely. I think it's really neat. But we'll have more information about what's in the beta for Android 12 in a future episode, but I think it's really cool that we have the ability to do that, and to try these things before they come out, you know, iOS, Android, Windows through the Windows Insider program, and things like that. JASON: I think the one thing that was kind of annoying to me though is — and maybe it's just I did it in a way that made this happen. But it ended up forcing me to reset my phone to flash the version of Android 12 on to it. And of course, when I had the version without talkback, I didn't mind resetting my phone. And I think if you downgrade back to Android 11, I believe it will make you reset as well. They do tell you that. So MICHAEL: you know, I love how my watch made a noise even though I have — typically if I mute my phone, my watch will mute with it, but not this time. JASON: Oh, interesting. MICHAEL: Yeah, usually it mirrors but not this time, that's interesting. All right, so for our ad part of the show today, I want to talk to you guys about app development services that's offered by iAccessibility. iAccessibility offers app development services for iOS and Android at $50 an hour where we will build your app from the ground up based on your website or however, whatever app you're trying to build. And the app will be accessible and usable by all users. Unless it's a game that you really need specific use cases. We'll still try to make it as accessible as possible, though. So,, we've built apps like VO Starter, we've built apps like Pocket Braille, Blind Bargains, ACB Link, And that's just a few of the different apps on a lot of platforms that have been created. So $50 an hour minimum of $1,000 and you can have your app in the iOS and Google Play app stores. So you can go to iaccessibility.net to learn more, and we will be promoting that more on the website. So, people look out and we'll have more information. So thanks for listening to the iACast. And now on to our main topic for today. And we've already talked a little bit about that, and it's Apple discontinuing products like the HomePod. And you guys, I — this is — I feel like this is the most products that Apple's discontinued at one time. And you know, Microsoft has done it. I mean, they discontinued a whole store line. Google, Google is the project killer, they are known for that. Do you guys think Apple's kind of jumping on board that train, JASON: I think in a way they are. I really think what they're trying to do is they're trying to streamline their product line, and you know, not have so many variations of things around. Especially in the case of the iMac Pro. I keep wanting to call it the MacBook Pro. That is a different product. But the iMac Pro because they really want us all to move over to Apple silicon, which, you know, I'm personally fine with. So I really think that's part of it. And, you know, as far as the HomePod, I like to think that they have something new planned to replace this beautiful, soft, lovely mesh, big HomePod that I'm totally like rubbing a finger against right now because it just, it's fun! MICHAEL: Hashtag pet the HomePod. JASON: Exactly. But you know, I really hope that they do have something to replace the bigger HomePod with at some point soon. Because, yeah. TAYLOR: Yeah. So the thing with that is that, I think, like I said, a lot of these companies are doing that right now. They're just trying to streamline. And you know, Google has been doing it for years. Microsoft kills things. But Apple, like I said, this is really a first. They don't really do this all that often. And so, either one of two things, they either have a lot more products coming and they need to get rid of stuff, or they're just trying to streamline because a COVID and everything, obviously, but we've been in COVID for over a year now. So who knows. You know, they're just trying to get things streamline. Or if they are trying to add new products, but they need to get rid of some first. MICHAEL: And it might be — it might just be that they don't plan to update. Oh, well, actually, you know what? I think the Home Pod runs on the processor that the iPhone seven runs on. Isn't it, Jason? JASON: The big HomePod? Yeah, it's the A8. MICHAEL: Oh, wow. And I think that's the next on the chopping block this year, guys. TAYLOR: iPhone seven, you think next? JASON: I think well, the seven has the A9, right? MICHAEL: I don't remember — JASON: No, wait a minute. No, I think the A8 is from the iPhone 6. Actually. MICHAEL: But I remember the 6S is the last version — iOS runs on the 6S. And so I bet the iPhone seven will be the final version that 15 will run on. JASON: Oh, that's possible. I mean, at the same time, they did actually change the foundation according to some tech sites. They did change the foundation of what HomePod OS was. So for a while it was based on a foundation of iOS. And then I don't remember when this happened. But supposedly they ended up changing the foundation from iOS to TV OS so that it wouldn't have as much code and things in in the OS that isn't really needed and used by the HomePod. So I was kind of not expecting to see the cancellation of the big HomePod for another year or two yet. I was a bit surprised. But maybe — I mean, I was going to say maybe this has something to do too, with the silicon chip shortage. But that would probably be more to do with the Mac, I would think maybe then the homePod. MICHAEL: Well, it's interesting because I'm wondering if they're going to rename the HomePod Mini eventually to something else. Or if we're going to have the HomePod Pro, come out and then put a new device in later on in the HomePod category JASON: Right, or the HomePod Max. TAYLOR: Right, or the HomePod Pro Max. JASON: I don't think they'll do Pro — well, I lie, 12 Pro. — MICHAEL: If you think about it, on the Mac, we don't have a MacBook, we have the Mac Mini, the MacBook Air and the MacBook Pro. We don't have a Mac Book or the Mac. TAYLOR: Oh, right. MICHAEL: So that might be kind of the landscape we're looking at for HomePod for a while. JASON: Maybe. MICHAEL: Because if you notice the mac book that came out like 2015-2016– JASON: 2015-2016, I think 2016, yeah. MICHAEL: It was short lived as well. So you know we have the air and the pro that are still around but the flagship name was was discontinued quick on that line too. So that's kind of interesting to think about. JASON: Yeah, it really is. And I think the one thing that's keeping me from being complete and utter 100% distraught that the big HomePod is being discontinued is just the fact that the — and I think I said this before, that Apple did say that they are still going to issue software updates for the big home pods for the time being, and supported still through Apple Care. MICHAEL: I'm wondering if you put two HomePod minis in a room, if you get the same quality sound as one big HomePod, JASON: I think you would get the same overall quality sound, because the HomePod Mini does seem like it sounds very similar to the big HomePod just without that deep low bass that the big ones can hit. MICHAEL: Yeah. And I don't know, it's to the point where when we look at these devices, it's hard to it's, and you know, maybe I'm just, my train of thought just keeps going all over the place. But the more I think about things, maybe this is a way for tech companies to dispel rumors and leaks by just saying, we're going to discontinue this, we're going to change this. And so it kind of throws people off to know what the next step is going to be. JASON: Yeah, maybe. I think though, in the case of the iMac pro being discontinued, we all know, it's most likely going to be because we're going to be seeing an apple silicon based iMac. Now whether we see that on March 23, which I personally don't think we'll see. I will say that on the show. And I'll be very happy to be wrong. But I don't think we're going to see that on the 23rd. MICHAEL: I think we will, I think that's going to be the focus is iMacs this year. JASON: I don't know, I think we might see things about AirTags and iPad pros and stuff, but we'll see. If I'm wrong. I'll be happy. Michael: See, maybe we need to come up with the accessibility pool. Because what I think we're gonna see and take your bets people. TAYLOR: Okay, MICHAEL: I think we're gonna see iMacs, colored iMacs, I don't think we're gonna see iPads just yet. But that's just me. Now, in saying that, iPads have come out in March before. So it's not out of the norm. But IMAX used to be used for education as well. And so if they bring out the colored iMacs like they had for education in the past and kind of marketed towards that, I could definitely see that being a march thing. And plus, iPad Pro has typically has an 18 month life cycle. It's only been 11 months since iPads have come out. So in other words, this is Michael trying to say please let my iPad be relevant in April. TAYLOR: Well, I have to agree with Jason on this one, Michael. Because, like I said, with all the evidence and stuff, I think it's gonna be AirTags and stuff. But again, if I'm wrong, I'll be more than happy to admit it. But I really think I have to agree with Jason, Michael. MICHAEL: And who knows, we may see all these things. I doubt it but TAYLOR: That'd crazy. JASON: no, you know what's really gonna happen. Apple's not actually going to have a product event on the 23rd, they're going to just announced their new products quietly on their site. And then we'll all be wrong. MICHAEL: And it could happen, it could happen. JASON: I do think though regardless, as sad as I am to see the big HomePod be discontinued, and like I said, me personally, I'm not terribly upset about the iMac pros cancellation and we're excited because, you know, that just tells me to watch out for the iMac. Not that I'm going to get one but it's still always fun to see what they're going to come out with. I still enjoy my HomePod. You know, I still plan on using it until something happens. Like, if nothing else using it until Apple decides they're not going to update it anymore. Whenever that may be, so. MICHAEL: Well, and that shows me that them discontinuing these things that just, especially on the iMac side it means that they have something new coming around the corner and they may decide that the pro line of iMac just isn't needed anymore because of what the A1 and A1x will do for these devices. I mean — JASON: You mean the M1? MICHAEL: Yeah, the M1. JASON: It's a processor, Michael it's not steak sauce. TAYLOR & MICHAEL: Right. MICHAEL: That needs to be the name of an episode sometime. Our previous episode title we came up with it is going to be it. JASON: Yeah, but that would be hilarious. 156 It's a processor not steak sauce. MICHAEL: All right. And you know, I wonder if that's why they started with a4S. JASON: I don't know. MICHAEL: Because Could you imagine Apple naming, now introducing our first processor line, the A1. JASON: and then Could you imagine the hilarity in covering the lawsuits, if that would even happen. That'd be funny. MICHAEL: Anyway, would that'd be a coprocessor for for Intel the A1 because it has to go along with it to make it better? TAYLOR: I don't know, would it be? That's your call. MICHAEL: I mean, if we're comparing Intel to steak there would be A1 processor from Apple to JASON: They'll call it, I don't know, I was gonna say steak Lake, but that just sounds weird. Dinner Lake, MICHAEL: Dinner lake. All right, out there. There you go Intel. When you come out with that chip that everybody wants just say time for dinner. Like, JASON: Exactly. MICHAEL: Anyway, I think this is the most jokes we've told in a podcast. And I really think that the M1X will really be like, there's no pro version of that, there's no way to up the process or on that. So there's, on the Intel iMacs, you can get i5, I7, I9, and you have the better display on the Pro, which they can still do the better display. But if the display is already going to be amazing in these new iMacs with the new chips, then they don't have a need to do that. So, there may not need to be an iMac pro because the new iMac will just be able to boast that it's pro already with the built in Apple silicon. JASON: And that was kind of my thinking, when I first read about the cancellation of the iMac Pro, I was actually thinking as you were talking and I don't really think Apple's gonna do this, if they came out with instead of the M1x. Or the M1 2, having the M1 Pro, but I really don't think they would do that, considering they already have products in their pro line that have the M1 and that would confuse people. MICHAEL: Right. But, you know, I just think that they're going to, I think that they — now that we're looking at coming slowly out of COVID, they're going to be looking for the best way to sell their products. And if you could just say, look at the shiny new products we have in our stores aren't aren't these amazing, people are going to want them and especially if they start doing these colors, like they've shown on concept art and things like that, that that are rumored, that's just going to be amazing. JASON: I mean, look at how popular the new Macs have been already, you know, because working from home and they've got that long battery life and the slightly upgraded camera because of the ISP MICHAEL: And you know, I'm doing all this on an M1 Mac, the recording and Zoom, and all that. And I keep telling people it's the better of the two machines. I mean, this is still a terrible camera, but I'm looking at my face on here. And it looks a lot better than my other Mac did, by far. So Apple has really gone a long way with what they're doing. All right, do you guys have any final comments we want to give before we wrap up today? JASON: Steak! MICHAEL: Yes. TAYLOR: Oh my God! JASON: No, I'm kidding. But you know, it's very interesting to see these product cancellations. I keep flitting between I'm sad, especially for the HomePod. And it's because there's going to be something new, like, a lot of me is just like, This has to because there's something new. So it's going to be very interesting to see what actually ends up happening. MICHAEL: Well, you know, the interesting thing, I want to point this out. The interesting thing about the home pod Mini is you don't need to plug those into the wall. JASON: Right. MICHAEL: And that's really interesting. I mean, you could build a USBC — you could buy a USBC hub, plug it into the wall and have five home pod minis hooked up to that thing — TAYLOR: In a power strip. Yeah. MICHAEL: Well, not even a power strip, just a USBC hub. TAYLOR: Oh, wow. Oh, yeah because it doesn't even plug in to the wall. Wow, I'm not thinking JASON: Or a battery pack. MICHAEL: Yeah, you could hook it up to a battery pack. And so that makes it almost more usable than the echo. TAYLOR: Yes, Yes! MICHAEL: And so I think that's why Apple really wants to focus on that because they're like, there's so much possibility here. TAYLOR: I wouldn't blame them. MICHAEL: I mean, it sounds better than any echo. I'm sure. I don't know, I haven't heard one yet. But JASON: Review say they do. MICHAEL: So, you know you put a few in a room. You're gonna get good audio. The only thing that you can't do is use the standard stereo speaker — or TV speakers. JASON: You can, they just won't — I just don't think they'll do Dolby Atmos and stuff that the big HomePods do. MICHAEL: How would you do — oh, well, Apple TV speakers, but how would you use the standard TV speakers? JASON: Oh, okay. Yeah, I misheard. I thought you said Apple TV. Yeah, you can't use Well, you can't even use a big HomePod as a standard TV speaker. So that's not MICHAEL: It's not new. Could you imagine if they came out with the HomePod sub where you had 2 of the apple speakers of the homepod minis as your regular speakers? Now, that's a possibility. JASON: That's actually funny that you mentioned that because I was talking to somebody pre show about that. And what they had said is, Apple comes out with this sub and then gives it 2 USB C ports so that you can plug two HomePods directly into the wall or something. I don't know if that is what they're going to do. But that would certainly be interesting. It'll definitely help with the idea of, I want to have stereo speakers, but I need two outlets if they decided to go that route. So who knows? MICHAEL: Yeah, I'm really excited to see what they do. I mean, if they bring out a HomePod sub, I will press that Buy button immediately. I'm not kidding that if they did that, you know, I would buy a home pod sub. And it kind of makes sense, guys, I think that's actually probably what they're going to do. Because it would make money for them. If you had to buy two HomePod Minis and A HomePod sub. Let's price the sub at $200. They're making $50 more off of you then if you bought one HomePod. Now, granted, they're not going to make 600 or $700 if you had to buy two regular HomePods. But, who's gonna do that anyway? TAYLOR: Right. JASON: Yeah, that's true. I think though, the only downside to this is, as it stands right now, if you were looking to buy HomePods, new, that would do Dolby Atmos, you can't, because that was a feature specific to the bigger HomePods. And I don't know if it's because the eight is more powerful than the S5 or whatever CPU the minis have inside, I think it's the S5 or if it's just that the Mini. , I mean, the big HomePod has more microphones, and it's not limited to the chip. But as of right now, you can't buy new home pods directly from Apple. If you want to do Dolby Atmos. MICHAEL: actually you can for right now during the time of this recording, but. JASON: I didn't even see a link in the store for the HomePod when I last looked. MICHAEL: So I just looked, and they're still in the Apple Store app for 299. You can pick either one. JASON: Oh, they have the Space Gray ones back? MICHAEL: Yeah, they're showing both of them, at least when I looked it showed a picture showing both of them. JASON: Oh, that's interesting, because I knew for a while that they only had the white ones around. And it's very interesting then that I couldn't get to them. Because on the Apple Store, on Apple's website, if you wanted to see the HomePods, the only way it was able to find them is by going under the Apple Music link. And they talked about the HomePods and the AirPods and the AirPods Max. The only HomePod they listed was the HomePod Mini. Whereas the big HomePod used to be there. So that's interesting that they still show up in the Apple Store — MICHAEL: Yep, they are in the Aplle Store app. Yeah. JASON: And of course you can buy them from other retailers. It's not just Apple that sells the HomePods but MICHAEL: And since they're discontinued, I would wait so you can get them from Best Buy or somewhere else where they will be much cheaper. TAYLOR: Yep. JASON: Just keep in mind, if you're going to go that route, that we don't know how long Apple is going to support the big HomePods with software updates, even — All we know is that they are still going to support them. MICHAEL: Alright, well, that's gonna do it for our show today. Jason, to end us off for today, where can people find you online? And what's your pick? JASON: So my pick is, funnily enough, not an Apple product, but rather a Google product. MICHAEL: Ah, just wait. It'll be discontinued at some point. TAYLOR: Probably Well, next week. JASON: Specifically, my pick is talkback version 9.1. And I pick it because it enhances talkback by allowing you to use multi finger gestures. Finally, it has a Braille keyboard. Although, the Braille keyboards been there since 8.4 I think it was? But I really find I like the multi finger gestures. I like the new unified talkback menu. And it's just, I just love this version of talkback compared to the older ones, because I can disable the angular gestures and the proximity sensor silencing speech. I can turn that off now because you can now tap with two fingers to pause speech. MICHAEL: Oh, that's fantastic. JASON: And the magic tap gesture for iOS users is there. And so it's really nice. You know, they don't have the rotor as such. I mean, you can't rotate two fingers on the screen or whatever, but they definitely do have an easy way to navigate, granularity and stuff now and it's all customized Pretty much. So talkback 9.1 it's pretty nice. So that is my pick. As far as where people can find me, you can find me producing content for iAccessibility, you can email me at Jason@iaccessibility.net. And you can also follow me on twitter at jde 1. I know that I have been giving my Facebook out in past episodes, I have decided that I will no longer give that out. I no longer have the app installed. So yeah, those are the ways you can follow me, find me email emailing me and following me on on Twitter. And if you catch me in clubhouse, then feel free to say hi, MICHAEL: All right, Taylor, what's your pick for the week? And where can people find you online? TAYLOR: Okay, so my pick is a little technical. So I'm going to explain it. I pick generate press. And for those who don't know, Generatepress is a WordPress theme. And a WordPress theme is basically a thing that will help enhance the visuals of your site. So it basically helps make your site look the way it looks. In a short version. I mean, like a short description. So what it will do is it is really awesome, because you can customize every part of your site. And the cool part is that it's fully accessible. There are two versions free and premium. The free theme is literally just you go download it from wordpress.org theme directory, and the paid one is a paid plugin. I believe it's 59 a year or what? I can't rember the lifetime of like 249 lifetime Michael? MICHAEL: I didn't see a life. Yeah, I think it's 250 lifetime TAYLOR: Okay, so I really love Generatepress thanks to Michael Babcock and dimasi Thomas for mentioning those to me in a Clubhouse room. Where you can find me online, I'm all over the web. Literally, I have a YouTube channel that I would like you guys to check out, Taylor's Tech Talks. And that also has a podcast now. So if you like hearing from me, you can hear from me and both of those places. I also am on Twitter and clubhouse you can email me at Taylor@iAccessibility.net. And follow me on Twitter, Taylor_arndt22. And I am also producing content for iAccessibility. MICHAEL: Alright, so my pick for this week is a book series I'm reading called Expeditionary Force. And the first book in this series is called Columbus Day. The author is, I believe his name is Craig allanson. And he he has written several books in this series. And it's an awesome, awesome book series, The sci fi series about aliens taking over Earth, and about how humanity kind of steals a ship and goes out in the galaxy to kind of protect Earth. So there's an AI That's hilarious. And I'm not going to give anything more away about the series. But check it out. Highly recommend it. I'm on the third book right now. And I've been reading it for about two weeks and each books about 15 hours on Audible. So that tells you how dedicated to this series I am. So highly recommend it. As for where you can find me. You can find me producing content for iAccessibility. You can email me at mikedoise@iAccessibility.net. I'm Mike, always on Twitter, and on Facebook, just search for Michael Doise. And you go to Michaeldoise.com from my website, and I have a YouTube channel that I'm trying to make time to work on. And you know, I have content everywhere. And yeah, just very excited to be on clubhouse. I'm there as well. So find me on clubhouse. Just search for Michael Doise, and we even now, here's an announcement. We have a club. We're all fancy and everything we have the iAccessibility network club. In fact, after this recording, we will be on clubhouse doing a after episode kind of a discussion to talk about these things. So come hang out with us on clubhouse as we talk about today's episode. So we hope that you have enjoyed this episode of the IiACast. And we'll be back in two weeks for another episode. And it's been awesome getting to talk about all these things with you guys, Jason and Taylor. Want to thank everybody that's been on the stream and everybody that will listen once the episode comes out. And we will be back next time for new episodes. So until then, take care and keep playing with new technology. JASON: This show has been brought to you by the IACast Network. We love hearing from you. Email us at feedback@iaccessibility.net. Got twitter? Follow us at iaccessibility1. Facebook, search for IAccessibility. Download our free apps for IOS and Android and keep up with all of our content at iaccessibility.net. If you'd like to donate to our show, hit the payPal button on our website, and get early access to our outtakes with a donation at patrion.com/iacast. Thanks for listening

Nerd heaven
Star Trek Discovery "Forget Me Not" - Detailed Analysis & Review

Nerd heaven

Play Episode Listen Later Nov 8, 2020 28:09


In the fourth episode of Star Trek Discovery Season 3, Forget Me Not, we pay a visit to the Trill homeworld, only seen once before in the DS9 episode Equilibrium. There, Adira hopes to find a way to connect with the memories of her symbiont. Meanwhile, Saru tries to help the crew deal with the emotional issues they're facing since leaving their lives behind. This episode had some fantastic character moments, and I'm loving the way they're developing Detmer's character. It was also wonderful to see Trill again. ----more---- Transcript Welcome to Nerd Heaven I’m Adam David Collings, the author of Jewel of The Stars And I am a nerd   This is episode 40 of the podcast.   Today we’re looking at the fourth episode of Star Trek Discovery season 3. For Me Not.   The description on Memory Alpha reads  Burnham and Adira visit the Trill homeworld while Saru's efforts on the Discovery to help the crew reconnect yield surprises.   It was written by Alan McElroy & Chris Silvestri & Anthony Maranville It was Directed by Hanelle M. Culpepper And it first aired on the 5th of November 2020.   Make it so.   This episode follows a fairly classic Trek structure. There’s an A plot and a b plot. But in this case, both are connected to the ongoing serialised plot arc of the show.   To be honest, my favourite part of the episode was not the Trill stuff, as awesome as it was to see a familiar Trek race come back, a DS9 race no less, it was the B plot that dealt with all the emotional baggage the crew are facing as they adjust to their new reality. It was done very well.   And that’s actually where the episode begins.   We get a log entry from Doctor Culbert. The visit to earth has been a reality check for the crew  and it’s all starting to hit them, just how little they have to hold on to. When they first arrived, it was all frantic survival. But now they’ve had time to live with it for a bit, and the reality is starting to set in. They’ve left everything behind. Everyone they ever loved. Everything that was familiar. The personal moments we use to define ourselves. They’ve jumped past all of that. They all feel lost and disconnected. Culvert is in a unique situation to understand, with all the weird stuff he’s gone through, and overcome. He knows something is going on with Detmer. He saw it back in episode 2. But she’s not yet willing to admit that she needs his help.   A mantra has arisen among the crew. “When we find the Federation.” some find comfort in that. But not all.   I’m really glad they took the time in this episode to acknowledge all of this. It’s important for believable characters. They can’t just go on as if their lives haven’t been turned upside down. We’re seeing the truth of what a big sacrifice it was that they made.   Now, here’s the big problem. I’ve touched on this a little in previous episodes, but there are so many crew members on the ship. And not just our main characters, who know Michael well and really care for her, but all the extras. The little guys. People like Gene who was cleaning Leeland’s remains out of the spore chamber, or the no-names we pass in the hallway in this episode. How well did these people know Michael? Well enough for them all to willingly give up their entire lives, their families, to go into the future with her? I’m sorry, but I find that pretty unbelievable.  The truth is, we should have had a small group of people come along, who had a close relationship with Michael. And maybe a couple of others who had nothing to leave behind. We should have a crew that is barely adequate to keep the ship running. We should be scrambling to find new crew members to come aboard and help. Not only would that add some extra tension to the show, it would be a whole lot more believable. It seems that practically the entire crew of Discovery came to the future. And I just can’t buy that.   And we’re reminded that Adira’s trill symbiont has the knowledge to help them find Starfleet headquarters. But because she’s human, she can’t properly access those memories.   Looking at Adira’s scan, the symbiont seems way too big, but that’s a minor nitpick, and there’s a bunch of ways to explain it. But it looks like what a trill symbiont should look like.   Adira doesn’t remember how she got the symbiont. In fact, she remembers waking up a year ago in an escape pod. Before that nothing. Does she mean literally nothing? As in, no knowledge of her life before the symbiont? I think she does. But there are some things bleeding through, like the ability to make a great Bajoran Hasperat.   They have a quick discussion, but all agree pretty quickly that the best option is to go to Trill. There’s no guarantee the Trill will help, but if they do nothing, nothing changes anyway.   So they arrive and ask for medical help for a host and its symbiont. The commissioner is delighted to help. The symbionts are very important to trill society. They always have been.  They carry the memories of their people. The population was decimated by the burn. It’s not immediately clear whether he’s talking about the host population, the symbiont population, or both.   Saru wants Stammets to investigate an alternative way to make the spore drive work, other than plugging himself into it. This makes a lot of logical sense. With the dilithium shortage in the galaxy, the spore drive is more important than ever. And if anything were to happen to Stammets, like it almost did, they’d no longer have any way to use it.   Stammets is immediately defensive about this. I’m not entirely sure why. I guess he sees the spore drive as his private domain. The science behind it was his baby. And it’s not like he didn’t try to find other ways of navigating it before they found the tardigrade. But as Saru points out, there’s been 900 years of technological improvement. Tilly brings up her dark matter idea, that she first started exploring last season. Stammets thinks it's a dead end and is surprisingly closed to talking about it. He won’t even give Tilly the time of day to explain her idea. I guess we just put this down to emotional stress from his recent injury, and the general stress that they’re all under, having left their whole life behind.   Michael is so much more human this year. It’s like she’s completely left behind all of her Vulcan upbringing. Sonequa Martin-Green is playing her very very differently. I’m wondering if the writers decided that the whole raised on Vulcan thing was a bad idea and are trying to move on from it.   She definitely laughs and smiles a whole lot more. Sometimes, it’s actually a little unsettling, to be honest. But on balance, I think I like this new Burnham more than the old one.   Culbert wants Michael to accompany Adira to the surface of trill. He thinks she'll be more helpful as a companion than he will, because this isn’t a medical problem. Adira needs the guidance of somebody who has gone through a traumatic life change. (which of course, he has as well. Culbert is at least as qualified as Michael, if not more, in that regard.)   I’m not sure why they can’t both go. But of course, the real reason is that Michael is the lead character of the show, so they have to make sure she is involved in everything. But Michael does a good job of helping Adira. I do like it when Culbert tells her she’s a responsibility hoarder. That’s true, although I think at least part of the fault there lies on the writers, not on her personally.   Adira doesn’t want to let anyone down. There’s a lot riding on this knowledge that Tal has.   But the big question is, why the heck are they flying down in a shuttle instead of beaming down? There is no reason given, and I can see no logical reason at all. It’s so odd that it really draws attention to itself.   Anyway, it’s nice to see that some former-Federation worlds like Earth and Trill are still idyllic. Trill is beautiful. I love the blue grass and the flying fish. Little moments like that add so much to the show for me. The wonder they bring is one of the big things I love about Star Trek.   Michael and Adira meet the Trill bigwigs. And they’re very shocked to learn the trill host is human. Very shocked. When asked to speak her names, Adira can only say her own name. She doesn’t know the names of her previous hosts. Michael explains that Adira can’t access the symbiant’s memories. They should probably have led with that.   Vos says there hasn’t been a single recorded example of a successful joining between a symbiont and a non-trill. So ….. Are we ignoring the TNG episode, The Host, then? I’m not saying that’s not a valid option? I mean, I think last week my words were that the episode is probably best forgotten, because of how it doesn’t match up with anything done in DS9.   But there’s another way to look at it. He says “successful joining.” We could potentially argue that Riker’s joining was not entirely successful. I mean, I’m pretty sure the symbiont completely supplanted Riker’s personality. It wasn’t a true blending. Adira isn’t experiencing a true blending either. But in her case, it’s the symbiont that is kind of the silent partner here. I think they kind of left it open for us to decide whether we want to acknowledge the TNG episode or not.   Adira says “the symbiant is part of me.” An idea that almost offends the Trill. She doesn’t fully appreciate what it means to host a symbiont. She doesn’t understand the responsibility. The honour. The subtleties of how they see the relationship. But of course she doesn’t. How could she? So, “it’s part of me,” is probably an understandable way for her to interpret it, from her limited perspective.   Anyway, Vos immediately calls Adira an abomination, and demands that they be separated, which would, of course, kill the host. The Federation has no say here anymore, so Trill law takes precedence. So would Trill law really support this? Maybe. They do seem to value the life of the symbiont higher than they value the life of a host.   Guardian Xi explains that the burn decimated the population. Specifically, the host population. It seems Trill is now experiencing a shortage of viable hosts. Which is interesting, because back in the 24th century, it was the other way around. The demand for a symbiont was so high that they had to artificially inflate the requirements to be viable for joining. He sees this as an opportunity. Adira could be the future. If they considered looking beyond the Trill to see other species as potential hosts, it could solve a lot of problems.   Leader Pav won’t support a forced separation, but she sees this joining as an aberration and so won’t help Adira either. She demands that they leave immediately.   It’s not entirely unbelievable the Trill would act this way. We know they have strongly-held ideals when it comes to the symbionts. For example, they have a very strong taboo against hosts getting involved romantically with somebody they were with in a previous host. Their value and even their spirituality are all centered around this relationship between symbiont and host. It’s okay to feel uncomfortable when you encounter something that doesn’t line up with your worldview, but the important thing is to maintain your compassion. And that’s what Vos, and to a lesser extent Pav are doing. It’s easy to forget, in situations like to forget that there are real people with real feelings on the other end. It’s okay for people to disagree on what they believe is right, but you can’t lose your compassion.   But Vos isn’t even willing to let them leave. He sets them up to be killed. He won’t let the symbiont go. Burnham sorts them out with little trouble. And then Xi turns up, offering to help, against orders. He leads them to the caves. Anyway, Culbert takes his concerns about the crew to the captain. Medically, they’re fine, but emotionally, everyone is suffering. Stress levels are very high. Saru sympathises but he needs a concrete way to help his crew.  The heart of the problem is that they need to feel connected.   So Saru does what he often does. He asks the computer for ideas. He’s not impressed with anything it’s spitting out. And then, something very weird happens. The computer screen flashes with something red, and then it starts speaking in a much more human-sounding voice. It laughs. And suggests humour is what the crew needs. A good laugh. And it’s not wrong. Laughter has known healing properties and benefits. But what’s going on with the computer? My immediate thought was, is this the beginning of the Artificial Intelligence we saw in Discovery’s computer in the Short Trek episode Calypso? I think there’s a good chance that is the case. Anyway, the computer offers some logical options. Things that I’m surprised Saru didn’t think of without the computer’s help. Actually. He’s a bit skeptical and asks the computer to run a diagnostic on itself. But he takes the suggestions on board. Back on Trill, they arrive at the caves. We’ve seen these caves before, on Deep Space Nine. This is where they keep the symbionts. The guardians are responsible for taking care of them. They swim around in pools and communicate with one another through electrical impulses.   It’s a little confusing what they’re trying to do, at first. Adira hops into the pool. At first, I assumed they planned to have Tal communicate with the other symbionts in the pool. But then, that wouldn’t accomplish anything, because the symbionts couldn’t pass along the knowledge they learn. What they’d really need to do would be to get another joined trill in there so the two symbionts could talk through electrical impulses, and then the other host could report on what was discussed. But, they don’t have another joined trill. We know that the guardians do not join.   What they’re really trying to do here is get Tal and Adira to communicate with one another. The hope is that here, in this natural habitat for symbionts, that connections will form. They have a device that will track her isoboramine levels.  This is a nice callback. Isoboramine is a neural transmitter in trill physiology. It enables the communication between symbiant and host. If levels get below 40% the symbiont will be removed, as to remain would be a great danger to both. But Adira is human. Her body would not produce isoboramine. So I guess, it must be generated by the symbiont. The funny thing is, the device doesn’t just have a readout or an alarm or something. No, when levels get low the grass cracks. That’s pretty strangely old-school.   There’s a fantastic scene on Discovery. Saru hosts a special meal with his senior officers, and those he works most closely with. A way to show them his appreciation for what they’ve done to get them this far, but also for them to come to terms with what they’ve lost. You’ll notice that the mythical chief engineer and chief medical officer still don’t show. After two full seasons, we still don’t know who they are. They should be in staff meetings, and they should be here now. I’ll be honest. This REALLY bugs me. A lot. It’s interesting that Doctor Culbert is here, but we know he isn’t the chief medical officer. At least, he wasn’t in season 1. Maybe he’s been promoted to that position, which would make him higher ranked than Doctor Pollard, who isn’t even at this table. It’s very annoying.   Anyway, I said this is a fantastic scene. And it is. It’s full of wonderful character moments.  It gets a little amusing when they start trying to come up with haikus, following Georgiou’s lead. It’s a nice scene that shows the camaraderie between the characters. It reminds me of that great scene in Avengers Age of Ultron when they were all joking trying to lift Thor’s hammer. Things turn decidedly dark when they ask Detmer to do one. And she keeps blabbering about Stammet’s blood. It makes everyone very uncomfortable, especially Stammets, and Culbert. It’s so terribly uncomfortable. It’s great. What I love about this scene is they’re finally developing Detmer as a charter. Remember back in season 1, when none of us could even remember the names of any bridge crew? I still don’t remember many of their names, but Detmer is one they’re really trying to develop. And we find that Emily Coutts is a really good actor, because the writers are finally giving her something to do. About bloomin’ time. We get a lot of insight into what she’s going through by what she says here. She’s feeling crushed under the responsibility of having the entire crew’s lives in her hands when she flies the ship. Specifically when she has to fly the ship under difficult circumstances, like going through the wormhole, or escaping from that parasitic ice. The argument between her and Stammets is so powerfully performed by the two actors. I love it so much.   Soon the conflict spreads and Tilly asks them if they think they have the market cornered on pain. And while this is not at all how Saru was hoping this would go, stuff is starting to come out. Stuff that needs to be dealt with. Some deep hurts.  Once half the table have left, it becomes obvious that the meal is over, and Saru is left alone. Poor Saru. You can’t help but feel for him. Adira’s Isoboramine levels are dropping. And she’s convulsing. That’s when Pav and Vos arrive. Vos is still being pretty unreasonable. Pav is not happy, but she’s starting to find that compassion. She allows Michael into the pool, even though she’s not Trill, to try to help Adira.   They use a neural stabiliser to help Michael communicate, mentally, with Adira. It looks like they’re standing in a big void filled with little tentacles. Michael quickly realises that the threads are like the threads of memory. That’s the symbiont trying to connect with her. It wants her to remember. She has to let the tentacles connect. It’s all kinda symbolic and in her mind. So the threats connect and Adira is taken back into a memory she has forgotten.   We meet Gray, Adira’s old boyfriend, who is a Trill. They were together on a generation ship, trying to find traces of the Federation. Gray was receiving a symbiont. Gray was a cello player. Adira is hesitant to follow through with the memory, she senses there is pain ahead. She has to open the gift, symbolic of continuing the memory, because that’s what happened in the memory, She gave a gift to Gray. It’s a quilt with stories of moments from their relationship sewn into it.   And then, in the midst of that happy moment, the ship is hit by something. Gray is badly injured. He’s gonna die. His biggest regret is that the symbiont will be lost. It will survive if removed from Gray and put into a new host. But there’s no other host available. So Adira says she’ll take it. Even though she’s not Trill. The medical robot performs the surgery. And that’s how Adira ended up in an escape pod with a symbiont and no memory of how it happened.   By accepting this memory and assimilating it back into her conscientiousness, the connections finally form, and she is able to access the symbiont’s mind. She and Burnham see all the other hosts. Several of them are Starfleet officers, in various different uniforms. One of them is from the Star Trek Picard era, which was really cool to see. There’s a pale blue uniform we’ve never seen before, and another, worn by Admiral Senna. That is clearly the current Starfleet uniform of this era. It’s quite unique. Very different to any other Starfleet uniform we’ve seen before, which makes sense for the time. It looks a bit more military. A bit more naval. I don’t mind it. But we get our first proper look at the new oval-shaped comm badge. We’d only seen it in blurry screenshots from trailers until now. It looks pretty good, actually. I like it.   Senna confirms that while a human joining is unusual, Tal accepts her as well. And Adira is reunited with Gray, who appears along with all the other hosts.   Michael thanks the Admiral for his message, which gave her hope. But she doesn’t ask about Starfleet. I found it so frustrating. I was practically yelling at the TV, “Ask him where Starfleet headquarters is.” it would only have taken a few seconds to ask. But she doesn’t. I mean, this is one of the primary reasons they went through all of this. Not the only reason. They wanted to help Adira too, but this information is vital. And she doesn’t ask. It’s not fully clear from the show at this moment, that Adira will now be able to access all of Tal’s memory, but I guess that was the implication.    Still, if it were me, I’d have asked him if I had the chance, just in case.   When Adira emerges, able to recite the nAMES of all of her former hosts, all Trill are all convinced. Even Vos says “we were wrong.” I found the character arc of these Trill to be a bit short and sudden. And Vos, especially, came around too far too quickly. He was willing to murder Adira a few minutes ago. Now he says “we were wrong.” It might have worked a little better if he had remained of the opinion that joining symbionts with non-human hosts was not generally a good idea, but agreed that Adira was deserving of their help, but Pav fully embraced the idea of non-trill hosts, as Xi already had. I dunno, I just think that would have added a little extra subtlety and depth to the whole thing. But the way they did it was okay.   Pav wants to mentor her, in her new role as a host, which wouldn’t be a bad idea, but Adira feels she is meant to remain on Discovery, and spread the message that the symbionts are a gift for everyone. Pav is even open to rejoining the Federation, should Discovery find them. It’s all wrapped up a little too neatly with a bow on top.   Anyway, Tilly comes to Saru to console him after the disastrous dinner. Captain Pike made connecting with the crew seem so effortless. But then, Pike had been captain for a long time. Saru is still very new to the job. But I laughed out loud when Tilly said “This just looked like a Tuesday at my house growing up.” Stammets also comes in to try to make amends with the Captain and Tilly. He’s finally ready to listen to Tilly’s ideas, and truly show her how much her help means to him.   And another fantastic moment occurs when Detmer goes to see Culbert in sick bay and admits that she’s not okay. She needs help. It was hard for her to admit. She’s ready to take him up on that talk. At first, I was worried that they were wrapping up Detmer’s problems too quickly, but that’s probably not the case. Her healing is going to take a long time. I think this is just the next stage. Hopefully they’ll continue to do a good job of exploring this, because I’m loving seeing Detmer turned into a person, and not just the “aye Captain” parrot.   But the crew are all called to the shuttle bay for a surprise. It’s a comedy film festival. Very old-school type humour. Very slapstick. I love Linus handing out popcorn. Then Detmer turns around and sees Stammets. And it’s a very awkward moment for her. How does she make amends for what she said to him earlier. And while her face is locked in anxiety and anguish, his unfolds into a smile. And their confrontation turns into a hug. That moment melted my heart and nearly broke me.   Saru and Cubert talk about how helpful this has been. “We just had to begin by admitting that we’re not fine,” Culvert says. “We’re not, are we,” asks Saru. “No. But we’ll get there.” Saru speculates. The sphere data was sent to discovery to protect it. They have done that. They’ve given up their entire lives to protect it. Now, it’s trying to return the favour. It is merging with their computer and trying to protect them. It seems pretty clear that my theory about this being the birth of the Zora AI in Calypso is correct. During that scene, the computer was voiced by two different actors. Annabelle Wallis, who played Zora in Calypso, and Julianne Grossman, who usually voices the computer. Interesting.   Senna knew the algorithm to find Starfleet headquarters and Adira has done the maths. They have coordinates. And she starts playing the cello, something both she and Gray picked up from a former host.   The episode closes with a little twist. Gray appears with Adira like a hallucination. A ghost, distinct from the others. Adira hasn’t told anyone about this yet. Gray doesn’t know why this is happening. There is precedent for something like this. Ezri Dax once performed a ritual that pulled the memories and consciousness of one of her former hosts out in a similar way. She could converse with him, but nobody else could see him. Adira hasn’t performed any ritual, but nothing about this joining has been normal. It’ll be interesting to see where this leads.   Another good episode of Discovery. It’ll be exciting to see next week whether they can locate Starfleet headquarters. I wonder what they’ll find when they get there. It should be interesting.   If you’re enjoying this podcast, please consider writing a review wherever you listen, or subscribing, if you’re watching it on youTube. Can you believe I’ve almost been doing this show for a year? I released my very first episode on the 6th of December. In one month, we’ll have to do something to celebrate the first birthday of Nerd Heaven.   Anyway, that’s all for now. I’ll see you next week for the episode “Die Trying.” Have a great week. Live long and prosper. Make it so.

Aufgschnappt
Aufgschnappt Folge 33 mit Michael Well

Aufgschnappt

Play Episode Listen Later Nov 3, 2020 36:15


Es ist mal wieder an der Zeit für ein Gespräch mit Michael Well (eh. Biermösl Blosn), Musiker und Top-Manager in der Agentur Well. Wir unterhalten uns über die letzten Wochen und die Auftritte, die möglich waren, über 40 Jahre Gerhard Polt & Well-Brüder, über den neuen Podcast "Ladies first", mit einem kurzen Schlenker in die Kabarett-TV-Landschaft und über unsere Pläne. Aufgschnappt geht mit dieser Folge in die Winterpause und kommt im neuen Jahr froh und munter wieder!

Control The Room
Michael Wilkinson: What Distinguishes a A Great Facilitator

Control The Room

Play Episode Listen Later Sep 15, 2020 52:18


“Whoever said, do what you love, the money will come, they got that right. Lots of work, mind you, in between. As we like to say, your passions determine your purpose. But it's your decisions that determine your destiny.” - Michael Wilkinson I’m pleased to have Michael Wilkinson here with me today for Episode 9 of the Control the Room Podcast. Michael is the CEO and Managing Director of Leadership Strategies, the largest provider of professional facilitation in the country. Michael, who grew up in the projects as what his sister described as a “Sesame Street Gangster,” eventually found himself at a New England prep school through an opportunity found through his job as a paperboy. After turning down an acceptance to Harvard Business School, Michael abandoned his 10-year plan to become undersecretary of Housing and Urban Development to begin a “faith-walk” that ultimately ended in his founding Leadership Strategies. In today’s episode, Michael and I talk about his path to the International Association of Facilitators Hall of Fame, what makes a facilitator great, and the six P’s of preparing for a meeting. Listen in to find out how Michael identifies and trains facilitators with great potential and how to ask the right questions in meetings. Show Highlights [1:38] Michael’s childhood in the projects of D.C. [5:39] Michael’s path to facilitation [10:30] What makes a great facilitator [17:17] Human connection in a virtual environment [26:07] Generating engagement when facilitating virtually [28:58] The only 3 reasons people disagree [35:16] The Six P’s of preparing for a meeting [40:56] Kumbaya facilitators [42:45] Asking the right questions [50:03] Leadership Strategies’ resources for facilitators Links | Resources Michael on LinkedIn Leadership Strategies Website About the Guest Michael Wilkinson is the CEO and Managing Director of Leadership Strategies, a leadership training and strategy consulting firm that specializes in group facilitation. He is also the author of books such as Secrets of Facilitation, Facilitating Strategy, and CLICK: The Virtual Meetings Book. In 2016, Michael was awarded a place in the International Association of Facilitators Hall of Fame. About Voltage Control Voltage Control is a facilitation agency that helps teams work better together with custom-designed meetings and workshops, both in-person and virtual. Our master facilitators offer trusted guidance and custom coaching to companies who want to transform ineffective meetings, reignite stalled projects, and cut through assumptions. Based in Austin, Voltage Control designs and leads public and private workshops that range from small meetings to large conference-style gatherings.  Share An Episode of Control The Room Apple Podcasts Spotify Android Stitcher Engage Control The Room Voltage Control on the Web Contact Voltage Control Intro: Welcome to the Control the Room Podcast, a series devoted to the exploration of meeting culture and uncovering cures for the common meeting. Some meetings have tight control, and others are loose. To control the room means achieving outcomes while striking a balance between imposing and removing structure, asserting and distributing power, leaning in and leaning out, all in the service of having a truly magical meeting. Douglas: Today I'm with Michael Wilkinson. Michael is the CEO and managing director of Leadership Strategies, Inc., a leadership training and strategy consulting firm specializing in group facilitation. Michael is the author of the bestselling The Secrets of Facilitation, and most recently, Click: The Virtual Meetings Book. Welcome to the show, Michael. Michael: It is my pleasure, Douglas, and thank you for introducing me to your audience. Douglas: Absolutely. It's a pleasure to have you. And I guess, speaking of the audience, I think they'd love to hear how you got started in this amazing work of facilitation. Michael: Well, as you know, because you've been there, and many who are facilitators know, there is no front door to facilitation. It's not like you can go to college and go, “I want a degree in facilitation.” Most people enter through the back door. The major entry ways, many come through H.R. Others come through the processing-quality side. Some come through the I.T., the consulting side; from the D&I, diversity-inclusion side. I was on the I.T. side. So I was one of those kids—in fact, if you back up my story a little bit, I'm a projects kid. I grew up in the projects of D.C.. So for those who know D.C., back in the day, Anacostia, the worst neighborhood in D.C., and I have to confess, at six, I was one of those bad kids, where we’re stealing from the local grocery store. Remember the corner grocery stores that used to exist? We would—and this is really bad—we would, at six years old, we were tying kids to trees and leaving them out all night. I mean, it was before gangs were gangs. My sister called this the Sesame Street Gangsters. It was just not good. And by the time I got to seven, we moved from what I call lower-lower class—the projects of D.C.—to lower-middle class, out in what’s today is Suitland, Maryland. And at that time, and people who believe that place doesn't matter, place absolutely matters. The kids in that neighborhood, they were building clubhouses. They had a chess club. And so me and my brothers, we started doing what they started doing. Even got a paper route, if you can remember the old paper boys, where you deliver papers. Had two paper routes, making money for my family. And the change, the big change, in life came when, at 14, the Post building, the Washington Post, sponsored interviews for private schools, and any of the carriers could come for an interview. I got interviewed, got accepted to a couple of the really big private schools in New England, started going to this New England prep school. My graduating class, 50 people, 50 people in the graduating class, including—and you won't know these names unless you were into that movement—but the Wares of Long Island, Paula Ware; General Patton's grandson, the Stacks of Greenwich is—do you remember all superlatives in the yearbook, “first to make a million”? Well, we had a superlative, “already has a million,” and there were two names. These are trust-fund kids. But I had gotten pulled into that environment. And as a senior, I did a study of grades and test scores. I was a psych major at the time. So a correlation in prep school of the—and I got the grades and test scores of my graduating class. Of course, the registrar stripped off the names, but he left them in alphabetical order, Douglas, so it was too hard to find Wilkinson. And to say my test scores were lower would be true, but an understatement. I was so much lower than the next lower person, I clearly took someone's place. Talk about affirmative action, they reached out and got me. They were looking for a black kid, and I was the only black kid in my graduating class. But I graduated fifth in the class, which means it wasn't really fair that I took someone's place. But it also wasn't fair that I hadn't had the preparation that all the other kids did. So once I got it, I just excelled. Went off to a New England prep school, and I came out. I was going to be undersecretary of Housing and Urban Development. I had a 10-year plan—even back then, Douglas, I was a planner—a 10-year plan to become undersecretary of Housing and Urban Development. I was going to go back to Harvard Business School. I’d gotten accepted. I’d asked for a two-year deferment. Decided I wanted to work for two years in D.C. so I could see how Washington worked and how the different agencies worked. And somewhere along the line, got the spiritual thing. So I'm a son of a minister, so I got really clear on getting directed from the Spirit, and had that what we call the bathroom experience, the second major shift in life. So they’re actually the third. The first, of course, was moving out of the projects. The second, getting the scholarship to go to New England boarding school. The third was hearing in the shower, from out of nowhere, “Michael, if your most important relationship is your relationship with Me, how is going to Harvard Business School going to help you do that?” There you go. There's 10-year plan down the drain, Douglas. So ended up, I quit my job, I told Harvard I wasn’t coming, and went on a six-month faith walk, where just—and things are great when you do a faith walk, Douglas, where these things are great 29 days out of the month. It's when that rent is due, that’s when things get really hairy. But it was one of the most important times of my life and learned some really important lessons. And the most important one, because I was asking, “Okay, God, you don't want me to do this 10-year plan. It was clearly my plan. Well, what do You want me to do? You want me to become a minister? You want me to go off on a mountain and contemplate my navel. Do You want me to stand on the corner and say, ‘Have you asked, talked about, thought about God today?’” And I got that direction, and a really important direction, that each of us is called to ministry. Ministry is service. That's what it's called for. Some people, it takes the form of the pulpit. For other people, it takes another form. Facilitation is my ministry. I ended up facilitating, 1985 is my first official facilitated session, in a session where we were doing requirements analysis, and it was going south. Vendor was presenting, just going all over the place. I was the youngest kid in the room. We have, you know, the consultants. I was with Ernst and Young, the youngest consultant on the team, but nobody was stepping up. So I just got up and said, “You know what, let’s structure this a little differently.” And so here with the client people, with our own consultants, and with this vendor, restructured the conversation and led it for that three hours going forward. Afterwards, someone said, “That was a great facilitated session.” Douglas, I was like, “What? What are you talking about? What's this thing called…” I had no idea. And then when they explained it to me, I said, “Oh, yeah. It's easy. Everybody is good at it.” And that's where I learned everybody was not good at this thing called facilitation that I had been gifted with some natural talents that made me instinctively good at it. And so I started doing it, started facilitating for my church, started facilitating for the nonprofit associations I was a part of. And then the fourth major shift in life came. This is the call that actually changed my trajectory again. Connie Bergeron—I remember. It was March 1991. She called and said, “Hey, we're looking for a facilitator. I've just been named head of Meeting Professionals International for the Atlanta chapter. I'm getting my officers together for a retreat. It's going to be on this particular weekend. Would you facilitate it for me?” I looked over my calendar, Douglas, and said, “Sure. I'd be glad to.” And, again, she said the words that changed my life, “And we’ll pay you.” Really? I mean, I was willing to do it for free because it’s fun. So she paid me. It was great. Two months later she called me back. Mentioned the pay word again. Three months later called me back. It was November of 1992, 1992, yes. I was, at that point, 18 months from becoming a partner at Ernst and Young. I turned to them, Douglas, and said, “I'm having way more fun on the weekends than I'm having during the week,” and left and started Leadership Strategies, the facilitation company. Do you like to say world headquarters, our second bedroom, which is great. Big plans, but just getting started. And it has been an amazing blessing. Today, we're the largest provider of professional facilitation across the country. We have 600 facilitators under contract. We have a core team of 27 facilitators. We've trained 28,000 people in facilitation skills; written six books on facilitation, the two you mentioned and four others. It is crazy. Here's this kid from the projects, and it's been just amazing blessing. Whoever said, do what you love, the money will come, they got that right. Lots of work, mind you, in between. As we like to say, your passions determine your purpose. But it's your decisions that determine your destiny. And so it was just a bunch of decisions that helped me along the way. And it's been just a tremendous blessing. Anyway, long story, but thought your listeners might enjoy understanding, how did I get here? because it's been a crazy, crazy ride. Douglas: Yeah. I mean, wow, impressive. And, you know, I think most facilitators can relate to this kind of moment of—well, kind of two moments that you described—the moment where you start to—these kind of natural talents start to click. You know, for me, it was always, I always found myself in meetings where people were disagreeing, but really they were saying the same thing but just in different ways, or they thought they were agreeing but they were saying different things. And I always had to interject and say, “Hold on for a second. I think you're saying this and you’re saying this,” and they're both nodding their heads. And then they stop for a second and realize that they were saying different things. And that happened enough and enough and enough that I realized that, man, that's something that I'm not seeing enough out of other people. And so I think that's something that's a hallmark of a facilitator, when you realize that in meetings, there's something about what you're observing or the way things are unfolding that really align with this ability to help move things forward in a natural and productive way. So I think— Michael: You really have touched on something that’s really important, and many facilitators may know it or not know it. When we were doing training early on, I was recognizing that there were people who were learning the techniques but missing some things that were going to make them a great facilitator, even though they knew all the same stuff that others knew or that we were training other people in. And I realized, and you put it well, that we talk about now seven key characteristics to look for. And people ask us, “Hey, we've purchased your training class. We're going to have a training for 16 people. How do I choose the 16 people in the class?” And we tell them, “Here's some target characteristics to look for.” We talk about seven, and we tell them, “Really it's three that's really important. And oh, by the way, the first two we can do nothing about.” So those three, just quickly, one is you got to like people, right? If you don’t like people, this is not something you should be doing, because people give you lots of reasons not to like them. So you really have to have a starting point, where you really like people. Two, you have to be able to process information quickly because there's so much coming and your mind has to be listening and processing at the same time and being able to differentiate, yeah, this is the same as that. This is different from this. This is…while you're listening, being able to process that. And if you can't process quickly, really, all you're going to be is a meeting manager. And great facilitators are way more than meeting managers because they're able to capture the spirit of a group; help engage them; and help guide them; can see down the road and around the corner, see the car or the truck that's coming that they're about to crash into, long before they're getting there, because they're processing while stuff is going on. So clearly, you have this skill, and then could recognize, a lot of people don’t, “Well done, sir. Applauding you. Well done.” Douglas: Well, yeah. You know, it's funny. I don't know how many times you've been speaking with someone that's maybe interested in learning facilitation or even a prospect or whatnot, and it turns out they're conflating facilitator and moderator. And I think that's maybe the big—and I think when you say meeting manager, it's all in that same bucket of, like, not facilitator. Michael: Yes. And it really, I mean, it really is because there are some people, people who are great speakers, think, “Okay, I'd be a good facilitator.” People who are great trainers, “Wow. I could be a good facilitator.” And we say, okay, let's separate this, because, as you know, facilitation has got convoluted with a bunch of stuff. So ATD, the Association for Talent Development, uses the name facilitator for trainers. And that's fine. Training facilitators, that's good. We can infer very much. But we are more group facilitators. In our business, it’s kind of interesting because what we find is in general, this isn’t completely true, but in general, our best trainers are extroverts. Our best group facilitators are introverts. One of my people who worked for us many years, she said something to me one day, and it's like, this capsulizes it well. She said, “You know, Michael, I like facilitating, but I really love training.” I said, “Okay, Leslie, I'll bite. Why do you really love training?” She said, “Well, when you're facilitating, you really have to listen to them.” And there you go. Ding, ding, ding, ding, ding. You get where I get that? Really rings the bell of why introverts, who are, really, they value listening and processing a lot more than extroverts, who generally like expressing. And so if you generally like expressing, you may find that training is way more your passion than facilitating, where you're really listening, contemplating, and helping a group move in a direction and so on. Interesting, yes? Douglas: Yes. And, you know, I can find that really fascinating because usually we like to pair up someone who’s kind of a classical trainer— Michael: Yes. Douglas: —and has that air, that performance aspect with a facilitator in these training sessions, because then that person can put on the dog-and-pony show while the facilitator is making sure that learning's integrated, because if you're not listening and working with them, you don't know if it stuck. Michael: And so what's interesting, I’m going to take you a step further, and I'm really biased here, that I really think we figured out in our company or we'll wait to think about how to make training work, because we don't hire trainers to train people in facilitation. We hire facilitators to train people in facilitation because they understand and role model all the techniques. But then we teach them about how important it is, with one of our eight principles in our facilitation course, all has to do with energy and keeping the energy high because that's one of the hallmarks of our practice. So we have to be able to, we call it show time. As an introvert, I get my energy from within, and people often are surprised when they see me do my thing, and then at the end of it, it’s like I’m the thumb in the mouth. I need a blankie. It happened twice before I realized this was a bad idea, Douglas. Clients who, when I was about, I was going to facilitate a two-day training session. Let’s say it started on a Tuesday. The client said, “Hey. Why don’t you fly in Monday night, meet with the team, they’ll get to know you, and then we’ll get started Tuesday morning?” Douglas, I did that twice. I’d never do that again, never, ever, ever, because what happens is, because I'm a natural introvert, when they meet me Monday night, the side conversations. “This is our facilitator? Really?” because— Douglas: We got a meeting with this guy all day? Michael: —I’m quiet. I’m just, that’s who I am. But once I—I'm glad we meet with them Tuesday night, because after that, they've already seen me. And now they're asking me the questions, not looking for me to entertain them, because I'm not an extrovert. I’m an introvert. So very different. So it's what we do in order to make it work. Douglas: Well, and nowadays we're in the midst of a pandemic. So all the team dinners are a thing of the past. Michael: Well, actually, actually, think about it. It really is. We still need—the social engagement is central. And so we as facilitators have to recognize, how do we make that happen, even in a virtual environment? And so we do that. So we may have this session from eight to five, and then we have a virtual cocktail hour for everyone. We break for 30 minutes, everyone grabs their favorite drinks, and we have a virtual cocktail hour for 30 minutes, an hour, as we would if it was a real session. But it's an important piece, so we can't miss it. That's for sure. Douglas: Yeah. And the human connection is so, so critical. Michael: How are you all doing it in your business? How are you keeping the human connection going during this? Douglas: Man, you know, I think it's always been a part of the design. And I think as long as it's a focus as a guiding principle, when you're designing an agenda for a session, it'll find its way in. I think it's important to start there first, right? Michael: Oh, it always helps. Douglas: Yeah, yeah. And I love this notion of the cocktail hour. Everyone has demanding schedules in this virtual space, right? And so they might have kids to run off to— Michael: Absolutely. Douglas: —or they’ve slotted it in. And it's a lot different than, you know, having taken the effort to drive somewhere and like, “Okay, I’m here. Maybe I’ll just stick around for a little bit longer.” We always just make it clear that, okay, the plenary is done; we're going to be around a little bit longer because I know some people like to stick around. Because I like to refer to it as, you know whenever you're cleaning up the supplies, people stick around and ask you questions? Michael: Yes, yes, yes, yes. Douglas: In virtual, there are no supplies. You can just shut MURAL and Miro or whatever off, and we’re done. Michael: We’re done. Bye. Douglas: So I like to tell people, “All right. Well, now we're cleaning up, and we'll be around for a little bit longer. If you want to ask any questions, we'll be here. But don't feel like you have to stay if you have places to be.” Michael: That’s a great idea. Douglas, I’m writing that down. “Hey, we’re going to have a clean up or stick-around time for those who…” I like that. You’ll see a blog about that soon. I like that. Courtesy of Douglas. Douglas: I love the cocktail-hour notion, too. It's like, I'm just making sure we reserve that time for people. In fact, it was BBC released a report, and the headline was quite hilarious. It was like, “Research Finds That Most Meetings Are a Form of Therapy,” or “Most Meaningless Meetings Are a Form of Therapy.” And the point was, and you hear that and you're like, “Well, that seems kind of crazy,” but it's kind of interesting because it's like people gravitate toward having these meaningless meetings, these meetings that nothing comes out of them because they have this need to have connection. And so if you think about it, if we get really intentional about our connection during meetings and plan them in, then people don't have to plan these extraneous things that then waste time. Michael: Well done. Well done. And we think that the pandemic has changed a lot of things. Unfortunately, one thing it hasn't changed is poor meetings. In fact, they've gotten poorer in the sense that with this virtual thing that people actually think that, well, because it's a virtual meeting, it takes less preparation or because it's—and we are finding, just as in our training work, we've converted virtual sessions where maybe 5 percent, 4 percent of our business prior to the pandemic, now it’s 95 percent. And our facilitators are finding it’s way more work, whether it’s a virtual meeting or virtual training, way more work to prepare for it. Way more. And the key is, we call it the virtual details, that where before you would have, okay, let's say we have a process-improvement session. And so we're going to start with (a) introduction; then section (b) we're going to talk about how does that process work today? Let's say we're trying to fix the hiring process in the company; (c) we're going to talk about the problems and causes; (d) we're going to brainstorm potential solutions; (e) we're going to reformat the process; (f) we're going to put together implementation plan; and so on. Well, that's what we'd do if it was face to face. We'd go, okay, (b) here's what I'm going to do with the flip charts. I'm going to set them up. And we know instinctively to do that. Virtual, whole different world. We say with each of those agenda items, do what you normally would do. But you also have to figure out the virtual details. So (b) you know what, I'm going to do a poll; action (c) I'm going to use the whiteboard; action (d) I'll do annotations; (e) I'm going to use a breakout group with…and then we… So we teach a course now called the Zoom Plus. And what that is, is everyone is now using Zoom, and you know wow. All those people, Zoom meetings, they're not even using all the basic Zoom stuff. Annotation, whiteboard, breakout groups, and so on. So we show them. And we like to say, “We are going to play with the technique so that you do it. You’ll play with them. Then, we're going to take the camera and put it behind the facilitator so that you can see how the facilitator creates the polls, how the facilitator creates the breakout rooms, and then you're going to do it.” So that’s using the basic stuff. And then, Zoom Plus, the plus part of that is we then show them what our facilitators do. And these are 15 virtual-engagement strategies, things like rotating flip charts. How do you use—how do you have the groups rotate through? Last person standing, dump and clump, and all these other advanced engagement strategies, using them, doing them, and doing them virtually. All cool stuff. So we first tried to get them using the basics, which most people aren't using. And then we're showing them, here’s how you use the advanced strategies that will make your meetings absolutely stand out. And people, as we like to say, you know you've gotten there when you hear people go, wow, that was the best virtual meeting I ever attended. And unfortunately, as you can imagine, Douglas, it's easy to be the best, because most are so poor and boring. Douglas: The bar is so low. So low. Michael: It is. Exactly. You’ve had the experience. Douglas: So. Yeah. And, you know, I think there's so much—early on, folks were asking, “Oh, do we get a discount for virtual?” And I’m like, “Man, I’m thinking about charging a premium,” because it's not only the prep time, but, you know, having an assistant facilitator is so much more critical because someone has to manage the tech. Michael: Absolutely. And what we're finding is frequently—I would put it in the 20 percent time—the facilitator has an issue. So as an example, one of our rules is for client sessions, client sessions, you never underscore underscore. Use your microphone on the computer. You always call in over the phone. The reason is if something happens to one of the two, you still have the other. So for some reason, you lose Internet connection, you can still talk to them. Or some reason the audio goes out, you can convert to what's happening. So you actually want to have redundant backup. We often suggest that you have another computer connected. So you have two sessions going, one is the participant computer. So if something happens, you can transfer over quickly to make it seamless. So it's almost like you run out of flip-chart paper. You run out of flip-chart paper, you always have a spare right there. Well, how do you do that virtually? Douglas: Planning on the redundant systems, having the activity by activity, having what is the virtual equivalent of all of this? Have I taken the time to proof it and make sure it's good? I mean, that is a lot of extra work, and not to mention just the fatigue of these environments. And, you know, I recently spoke with someone. They were telling me that—I'm not sure where the research came from, so this is all anecdotal—but they were saying that any time we're typically working in a three foot kind of context, it's typically a fight or a mating scenario. Michael: Wow. Douglas: Because you don't get three feet in someone's face inside the meeting room. That would be awkward. But now we’re doing that with these computers and is very sometimes mostly charged, political, like, we're talking about some really intense stuff. And we go in, and we try to—one mistake we made early on was, let's have an eight-hour session virtually. And, you know, you can't do that virtually. Michael: Yeah, it’s much harder. Douglas: You have to do it much shorter. And so I think there's some training of setting expectations for clients, too— Michael: Absolutely. Douglas: —even ones we've worked with in the past. Michael: Yeah, yeah. And so I'm going to go a step further, because this will be—because you are correct that the virtual sessions, by their nature, the dynamic is very different. And I want to—everyone knows—not everyone knows—many are aware, and it comes out in our polls, when we ask people, what is the biggest challenge in virtual meetings? And we've asked this to thousands of people now through our webinars and so on. It always comes up with the same thing, and it's not even close. It's engagement, keeping people engaged, because people are multitasking, doing other things. And so as facilitators, that's got to be our number one focus. How do we keep people engaged? And here is something that we ask people to consider. We as a company, we do have, we have what we call the PDI Difference—Practical, Dynamic, Interactive. And the way we do that in face-to-face sessions is we ensure that if we're training people or having a facilitated session, there will be significant engagement every 20 to 30 minutes. Thirty minutes will not go by without significant engagement, and mostly 20 minutes. So somewhere between 20 and 30 minutes. Douglas, when you go virtual, cut that bad boy in half. You’ve got to have significant engagement every 10 to 15 minutes. So if you’re getting people together, if you are going 90 minutes between breaks, do the math. Even if you say, “Well, the beginning, there's obviously engagement. People are going.” And the end of that 90 minutes you have engagement, so that means you've got to have at least four others, at least four other engagements. And if all you know is the classic engagement question-answer, question-answer, man, that meetings will wear people out. That's why it's so important for people to have all these other engagement strategies—dump and clump, last man standing, rotating flip charts, all this other stuff, to help put in people's toolbox. And so really important for facilitators to recognize that it takes a lot more if it's virtual. And as you said, training our clients that, “Listen, you know, normally I would charge a day of prep for this, but it's virtual. And so therefore,…” Yeah. And making it clear it's extra. Douglas: Absolutely. Let's talk a little bit about the Secrets of Facilitation. Michael: Oh, my favorite book. Yes. Douglas: You have over 60 secrets in that book. Michael: It is. And really good stuff, I think, personally. Douglas: Yeah. I'm a fan. I have it on the bookshelf behind me. And, you know, beyond the basics, things like preparing and managing for dysfunction, what do you think the biggest secret that most people don't know? Like, what's the one that you’re just like time and time again does no one just…? Michael: There are a couple that come to mind, but let me focus on this one. And I'm about to make a statement, Douglas, that when I say it in our training classes—I mentioned we trained over 20,000 people—there are always people who go, “No, that can't be right.” And by the end of the teaching, they go, “Yeah, that's really true.” Here is the statement: there are only three reasons people disagree. Huge secret. There are only three. Every disagreement in the entire freakin’ world, there are only three reasons people disagree. Only three. Now, that's the good news, and that's really good news. But here's the bad news, and it's really bad news. If you have a level-three disagreement and you try to solve it with level-one techniques, you're going to fail. Level-three disagreements can't be solved with level-one techniques. Likewise, you have a level-one disagreement, try to solve it with level-two techniques, you are going to fail. Can't happen. So we as facilitators have to understand the three reasons people disagree. Have to be able to diagnose which reason it is and have strategies for addressing each one. Now, while that's a teaser, I probably should take a minute to say what are those three reasons people disagree. So let's break it down really quickly. So you probably have figured out one, two, or three of them. You want to take any guesses, Douglas, or you want me to reveal? Your shot. Douglas: Why don't you—well, you do the reveal. You do the reveal. Michael: Okay, I’ll do the reveal. So number one, and it's most disagreements, level-one disagreements, and you actually implied it when you were talking about learning that you were a great facilitator. That is, people disagree because of information. One has information that the other doesn’t have, and they’re arguing, bumping heads, even though once they realize and the information is put on the table, they'll realize they weren’t in disagreement at all. Level-one disagreements always end the same way. “Oh, is that what you meant?” There you go. And as we like to say, when you hear those words, your job is done, because they really weren't in disagreement. In fact, the book Crucial Conversations highlights that, they give it a name, violent agreement. They really are in agreement, but they were arguing. They were just using different words or one had information that the other didn't have. So you saw level-one disagreements, pretty simple. We as facilitators have to understand the difference between advocacy and inquiry. If you ever watched two people arguing, it's like they're fighting back and forth. Statement, statement, statement, statement. Each person is trying to advocate for theirs. If one of them would just step back and just ask the question, “Well, why do you say that? What do you mean by that?” they’ll then would clarify, and you would hear those words, “Oh, is that what you meant?” There you go. Resolved. So we have to move people from advocacy mode to inquiry mode, and you do that yourself by asking questions. In a business environment, there are specific questions we train facilitators to ask, because most level-one disagreements or business are based on either cost, time, who’s involved, or how it’s going to happen. And so we get the questions. Level-two disagreements are different. If the level-one disagreements are about information—again, we find most disagreements are level one—level-two disagreements are about values or experiences, that they have different values or had had different experiences that prefer one alternative over the other. They understand each other perfectly. They just value different things. Well, you can solve a value disagreement simply by identifying and isolating the key values. What are the key values that each person has? And then creating solutions, brainstorming solutions, that combine those values. It's not a compromise activity. It is a creativity activity, where, as we teach it, you can come up with some pretty novel solutions once you isolate those key values. It just works. In fact, we get more letters about that technique than any others because it really does work when you understand what you're looking to do. Level-three disagreement is different. It's not about information. It's not about values or experiences. It's about personality, past history with one another, or some outside factor that has nothing to do with the disagreement. It's not about the disagreement. They basically don't like each other. Can you solve a level-one disagreement by asking questions about the issue? No, because it's not about the issue. Can you solve a level-three disagreement by asking about the values? It’s not—yeah, you solve level-three disagreements differently. Take it to a higher source. You're not going to solve it at this level. You've got to take it up the chain. And so we talk about strategies for doing that. But most facilitators, that secret of understanding there are only three reasons people disagree, and so when you're listening to a disagreement, we train people to say, “Hey, next time you're listening to a disagreement, just say under your breath, ‘level two. Yeah, level one. Yeah, level three,’ so that you can get used to diagnosing what type of disagreement it is so that you keep that mindset of, okay, here's the technique I want to use to adjust this disagreement. So it's cool stuff and really one of those fun secrets out of the 60. Douglas: Yeah. I love frameworks like that, that can—are very actionable and we can kind of lean on them in the moment pretty easily. Michael: Well, you know, I find that the best facilitators are process oriented, Douglas. And I'm just going to give your listeners a heads up. If you were to see the prep work that Douglas had sent out to my office around the thinking that they've already done around how to have a great podcast, it was like, oh, my gosh, this is like a cookbook. All I have to do is this part. They're doing all these other pieces. And some great process thinking, very much appreciate it, because it makes it easy. In the same way, if you can give facilitators a process to use that's been tested, proven, that they can modify and make theirs, it makes all the difference. And that's one of the things I think we're good at: giving people processes. Douglas: Absolutely. If you could change one thing about meetings in general, what would it be? Michael: Oh, my gosh. Wow. You're asking big questions here. If I could change one thing about meetings. Yeah, I guess—yeah, that would have to be it. Douglas, the biggest challenge I find, and we find over and over again with meetings that other people are leading, is preparation. So few people do the preparation necessary. And quite frankly, it's not a lot of work if, as you would say, there's a framework for it. And so I'll just give your listeners a framework. We call it the six Ps. And it doesn't matter whether you are running a meeting for yourself or running a meeting for someone else, ask the six Ps, because once you know the six Ps, you execute on that and you can be really prepared. One, and you know it all starts with purpose. Douglas: Yes. Thank you. Michael: Why are we having this meeting? Douglas: Yes. Michael: Why are we having this meeting? What's the real purpose of the meeting? And then we say, “Okay, now that we're clear…” And so I'll give an example just to make it real for your listeners. Someone may come to us. “Michael, Michael, I’d love to have a team-building session for my team.” First P, purpose. “Really? Help me understand what's really the purpose of the team-building session?” “Well, I need my team working together better because, you know, we kind of snipe at each other sometimes. So I really want us to have a strong, bonding experience so that we can walk out of that room, moving together, working together, feeling better about each other.” “That's helpful.” Second P, product. “So what is the product you want to come out of that meeting?” “Michael, what do you mean?” “Well, think about it this way, in terms of the three Hs. When this meeting’s over, what do you want your team to have in their hands that they can see?” “Well, Michael, it’d be great if we had a team vision.” “Cool. Anything else?” “Well, maybe some team norms.” “Okay. Anything else?” “Well, maybe if we could walk away with what's going to happen if someone violates the norm, so we have that kind of…” “Anything else?” “No, I think that's pretty good.” “All right. Well, thank you. Well, let me ask you this. What do you want them to have in their head when the session is over?” “Michael, what do you mean?” “Well, what do you want them to know that they didn't know before the meeting started?” “Well, maybe I want them to know, hey, what makes a team great? What are the qualities of a great team and know how we assess against that, and what are the things we need to work on to be a great team?” “Cool, cool, great. So what do you want them to have in their hearts when the session is over?” “Michael, you getting soft on me?” “No, no, no. What do you want them to believe that maybe they didn't believe before this session was held?” “Well, I want them to believe that if we do these things, we’ll be a great team. I want them to feel committed to making it happen.” “There you go. Great. Well, so you’ve talked about purpose and product. Let me ask you this. Tell me about the people who are going to be in the room. Who needs to be in the room that we create these products and achieve this purpose?” “Well, I want my whole team there.” “Anyone else?” “Well, you know, do you think, Michael, my E.A., should be there?” “Well, let me ask you, do you think your E.A. is part of the team, work with the team? Is your E.A. part of getting things to happen?” “So, yeah, that's great.” “Anyone else? There we go.” “All right. Well, we talked about purpose, product, participants. Let me ask you this. What are the probable issues that we need to address? What are the things that we absolutely need to talk about if these participants are going to create these products to achieve this purpose?” “Yeah. We've had a couple of things happen over the last few months that we really need to talk about.” “Well, let's talk about what those are. Anything else we need to talk about? Great.” “Well, now let's talk about process. What's the process you're thinking we might want to take the team through so that we address these issues so the participants create the product and the purpose? Great.” And notice, by the way, Douglas, process is fifth. Many people think, “I want to hold a meeting. What's the agenda?” Wrong answer. There’re four questions you have to answer first—purpose, product, participants, probable issues—before you get to process. Never start with agenda. And then the six P is place, meaning—and it's all the stuff around the place. And in these days, the place is virtual. So let's talk about all the things around the virtual platform that needs to be. So we say when you have those six questions answered, the six Ps of preparation, you're now ready to do the work to get well prepared for your session. So we think that's a great way to address and make meetings so much better. Just most people don't do the work. They don't think about the six Ps. Douglas: Yeah, you know, there’re so many meeting—you talked about the lack of preparation, and it’s like— Michael: Yeah. Douglas: And so there's this weird spectrum, because on one end, no one's doing anything. So they're just kind of walking in blind, and they just threw something on your calendar called a meeting, and they're not even—so there's a lexicon and taxonomy problem. Michael: Yes. Douglas: And so that's a whole other thing we could get into. But then on the other hand, when they do the planning, their agenda’s just a list of topics— Michael: Yes. Douglas: —and it’s not thoughtful, it’s not informed by— Michael: Absolutely. Douglas: —the purpose. We were just talking earlier today about the problem with icebreakers and warmups, in that— Michael: Oh, my gosh, yes. Douglas: —people just throw them on the agenda, without thinking about the purpose and why they’re there. And I love this. I have this saying that if you can’t ask your participants after doing something like that, “Why did we just do that?” and have it erupt into a pithy conversation, you need to ask yourself, “Why did we just do that?” Michael: Oh, well said, Douglas. Well said. In fact, our company, in general, when it comes to icebreakers, we hate them because most icebreakers are just stuff. And we say, “It's good to break the ice,” but you want to break the ice with an activity that furthers the purpose and product of the session. If you say, “Hey, you know what, we’d like to spend a few minutes talking about your favorite vacation spot,” that's a great icebreaker if the purpose of our session is to choose a vacation spot. If it's not, leave that icebreaker at home. “Hey, you know what, we'd like to hear about your most embarrassing moment.” That is a great icebreaker if this session is about dealing with embarrassing moments. If it's not, leave that icebreaker at home. Whatever you use as an icebreaker, it should further the session result, not be something, as you said, that’s unpurposeful and inserted into the meeting. Facilitators have a bad rap of, “Hey, we help people hold hands and sing Kumbaya.” Read that from an executive standpoint, “We're great at wasting people's time.” That's how executives view the classic Kumbaya facilitators. Our job is to make sure every moment we spend with executives is productive. It's used to get to a result that they are willing to invest in. If they're not willing to invest, we have just added non-value activity. So non-value added activity is not helpful in a facilitated session. Douglas: Well said, my friend. So I would love to leave our listeners with one last piece of advice. And so if you could ensure every facilitator in the world had one skill, what would it be? Michael: That's easy. That's really easy. When you think about facilitators, when we walk into a room, our most important job is to pull out the most important information that's going to help this group get where they're going. That's our responsibility. To do that, we don't have to be good at asking questions. We have to be great at asking questions. We have to be really excellent at using questions to pull out the information that's going to help the group. As I said in one of my early, early ad set we put together, the ad said, “Hidden inside of your company are answers to some of the most important issues facing your organization. Your people have the answers. We bring the questions.” And so we teach something called the secret of the starting question. If you’ve ever facilitated a session and you asked this really great question and got complete and utter silence, if that’s ever happened to you, what we teach is, more times than not, the reason you got silence is that you asked what we call the “type A” question instead of a “type B” question. Type A questions lead people to silence. Type B questions get people putting up their hands, jumping up and down, trying to get you to respond to them. Or you're old enough to remember Welcome Back, Kotter. We called it the Horshack effect. “Ooh, ooh, ooh, Mr. Kotter. Mr. Kotter, call on me.” And that's what we want to get. And so, how do you get that? Well, it’s all in how you ask the question. And we call it the secret of the starting question. Now, just to give an example. Let’s go back to my hiring process. If we're in a room and we got a bunch of people, we're trying to figure out how the hiring process works today, that's one of the first agenda items. As a facilitator, we go, “Okay, great. We're all together. We're ready to get to that first agenda item. Let's get started. How does the hiring process work today?” Crickets. “Come on, folks. You know how it works. How does it work today? What are the steps?” Crickets. “Come on, guys. You know the…” There you go. Instead, you would ask what we call a type B question, and it sounds like this. “You know, we're ready to get started with documenting the current hiring process. I'd love for you to think about the last time you hired someone. Think about all the steps you had to go through, all the people you had to talk with, the forms or whatever you had to fill out to get that person on board. What are the steps in the current hiring process?” We call that a type B question. How is it formed? They're three steps. It's pretty easy. It's pretty simple, just not easy. Its first step is you start with an image-building phrase. “Think about the last time…,” or “If you were about to...” or “Imagine…” It doesn’t start with “What…” Here comes a type B question. You're going very direct. Or “Why…” or “How…” or so on. It starts with an image-building phrase because you're trying to create an image, because when people can see their answers, they answer right away. Then, you expand the image with at least two other phrases. Then, you ask the direct question. “Think about the last time you hired someone. Think about all the steps you had to go through, all the people you had to talk with,” and so on. Because when people can see their answers, they raise their hand. When people can’t see their answers, if you ask, “What are the steps in the current hiring process?” they're going to go, “Hm, let me think.” What are they doing? They're trying to imagine their answers. Why? Because you didn’t ask a question that helped them do it. Facilitation means to make easy. We've got to get them visualizing their answers. So that's just one of the things. We teach nine different questioning techniques. And if we could do that for every facilitator in the world—in fact, your audience have probably heard of TED Talks. If they were to go to the TED site and type in “secret of the starting question,” they would see me giving a TEDx Talk to the International Association of Facilitators on the secret of the starting question. Douglas: I love it. So good. It's funny, once you were starting to talk about the secret to—or the one thing that facilitators should know, and you started talking about questions, I was going to ask you, what is one of your favorite questions? But then, before I even had the opportunity, you gave us a framework for asking questions. So I'm still going to throw this at you for extra credit. Is there a question…? In fact, you threw out one of my favorites already, and that is, what did you mean by that? I think that's such a disarming question, especially if someone says something that is maybe judgmental or offensive in some way, and maybe there was no intention behind it, and we want to just give them an opportunity to unravel that or explain it. Michael: And it helps them do it. And that’s a great one. And I think one of the things you find is why questions and how questions are often challenging for people. And so you want to be careful, as we say, you want to focus on the tone. And probably my favorite, it's simple, is, “Help me understand, why is that important? Help me understand, why is it important?” because your tone could be, “So why is that important?” That’s a wrong tone. No, thank you. Yeah. So tone as you ask that question, “Why is that important?” is one of my favorite questions. There have to be questions because it gets to, oh, new understanding, because I'm thinking, perhaps if you could see my thought bubble, “What does that have to do with anything we're talking about?” And so sort of just, “Hey, help me understand, why is that important?” Douglas: Also, “Help me understand,” I'm taking the blame for not understanding it, which is great. It reminds me, too—I've been listening to a lot of masterclass. And Chris Voss has a really great masterclass, and he's a master negotiator— Michael: Oh, excellent. Douglas: —and author of that book, Never Split the Difference. And one of his points around not using why, he never asks any why questions when he's negotiating with a hostage. And it's because, remember when you were a little kid and something you broke, something by accident, and your parents were like, “Why did you do that?” So it's just like, it brings you back to those moments. So we don't want to psychologically hijack anyone when we're asking these questions that we don't really have much intent behind. Michael: There you go. Really important stuff. Questions are a key for facilitators. Really getting down a question framework for yourself, really good stuff. Douglas: Absolutely. And I encourage people to check out the type B questions and all the other great stuff, the six Ps, et cetera. It's really awesome stuff. And so if they were going to dig deeper into this, how can they find you? How can they unravel the secrets more deeply? Michael: Well, please, our website, www.leadstrat—that’s short for Leadership Strategies—leadstrat.com, and any of the resource pages. You can also, in our store, we have all the books—The Secrets of Facilitation is probably the one we’ve talked about the most, as well as Click: The Virtual Meetings Book. Those two are ones that in this pandemic people will find most helpful. And again, do check out— Oh, our gift to the industry, we recognize that as part of our—we’re the largest facilitation company in the country, that what we do, we typically do three or four free webinars a month. Most recently, we've been doing them on the virtual side of things, running effective virtual meetings, making Zoom hum, those kinds of things, just, really, free webinars. Of course, we do it because we know that once people get a taste of what we do, they may want to learn more. We’ve been doing them for over a decade now, these webinars. But please check them out. And you know what most webinars, Douglas, are thinly veiled sales pitches. For us, we go, “Okay. Please give us 60 minutes. You're going to get 55 minutes of real content, stuff you can use tomorrow. Then, the last five minutes we’ll talk about for those who want to learn more.” So really hardcore, hit-it content. And so it's really great. They get 400 or 500 people on every webinar, and so it's really fun stuff. Douglas: Excellent. Well, I can't wait to check one out. And, you know, it's been a pleasure to have you on the show today. Michael: Oh, likewise, being with you. It’s just been a fun conversation. Douglas: Absolutely. Well, thanks again, and we’ll be talking to you soon. Michael: All right. You take care. Outro: Thanks for joining me for another episode of Control the Room. Don't forget to subscribe to receive updates when new episodes are released. If you want more, head over to our blog, where I post weekly articles and resources about working better together

英语每日一听 | 每天少于5分钟
第965期:Travel Tips For Portugal

英语每日一听 | 每天少于5分钟

Play Episode Listen Later Sep 6, 2020 3:16


更多英语知识,请关注微信公众号: VOA英语每日一听 Michael: So Ana, you're from Portugal, right?Ana: Yeah, right.Michael: Okay, because I'm actually thinking of going to visit Europe this summer, and I thought Portugal would be a great place to visit.Ana: Oh yeah, Portugal is great especially in the summer. It will be really warm and you can go to lots of places in Portugal. You can go to the North where we have a lot of mountains and you can do all kinds of activities like archery and horse riding.Michael: Oh wow, that's interesting. Well, actually, I was thinking of going to the beach. Can you give me some advice for what's the best time of year to go. And perhaps there are not too many tourists are on.Ana: Oh yeah, if you want to avoid tourists, you should definitely not come in August. August is really crowded and there are just so many people in the South of Portugal. You can try to come in June.Michael: All right.Ana: June is already warm but there are not too many people. So it will be easier for you to find accommodation. There are some really nice hotels and hostels around. So what kind of place were you thinking of staying in?Michael: Well, actually, I don't really mind too much. I think I'd like to see what it's like for normal people in Portugal, what it would be like to go on a holiday and have an authentic Portuguese experience. So maybe – I don't really want to stay in a big international hotel. What's a typical Portuguese place to stay and is nice for a summer holiday?Ana: That's interesting, yeah. In that case, you should definitely avoid the big hotels or any hostels. There are some apartments that you can rent. So you can just live in an apartment by the beach.Michael: All right.Ana: Yeah, they're just in a normal building with other Portuguese people but you can rent it and stay there and it's really close to the beach. It's like a one-minute walk. So it will be really convenient for you.Michael: And this is by the Atlantic Ocean.Ana: Yes. Yes, it is.Michael: All right. That sounds like a very good idea staying at an apartment. How much should I budget for that?Ana: Hmm, I am not really sure. It will probably be a bit more expensive than a hotel.Michael: Really?Ana: Not in the long term. You can pay about EUR 30 per night, I think.Michael: Well, that's huge.Ana: For a nice location, yeah. If you come with friends though, you can also rent a villa. We have some villas also by the beach.Michael: Does it have a swimming pool?Ana: It does have a swimming pool. And they have plenty of room. So if you want to come with a big group, that's definitely a better option.Michael: That sounds like a great idea. I can invite my colleagues along. So do you have any final tips for me, for my holiday in Portugal?Ana: Well, I mean, if you want to stay in the South, in the Algarve, then I definitely recommend you check out the nightlife. I can be really lively in there in night markets where you can buy lots of souvenirs and people just hang around. So I definitely recommend that.Michael: Okay, and what was the name again? The Algarve?Ana: The Algarve, yeah. That's the southern part of Portugal, so you can't miss it.Michael: Oh, I got to remember that. Thank you very much.

英语每日一听 | 每天少于5分钟
第965期:Travel Tips For Portugal

英语每日一听 | 每天少于5分钟

Play Episode Listen Later Sep 6, 2020 3:16


更多英语知识,请关注微信公众号: VOA英语每日一听 Michael: So Ana, you're from Portugal, right?Ana: Yeah, right.Michael: Okay, because I'm actually thinking of going to visit Europe this summer, and I thought Portugal would be a great place to visit.Ana: Oh yeah, Portugal is great especially in the summer. It will be really warm and you can go to lots of places in Portugal. You can go to the North where we have a lot of mountains and you can do all kinds of activities like archery and horse riding.Michael: Oh wow, that's interesting. Well, actually, I was thinking of going to the beach. Can you give me some advice for what's the best time of year to go. And perhaps there are not too many tourists are on.Ana: Oh yeah, if you want to avoid tourists, you should definitely not come in August. August is really crowded and there are just so many people in the South of Portugal. You can try to come in June.Michael: All right.Ana: June is already warm but there are not too many people. So it will be easier for you to find accommodation. There are some really nice hotels and hostels around. So what kind of place were you thinking of staying in?Michael: Well, actually, I don't really mind too much. I think I'd like to see what it's like for normal people in Portugal, what it would be like to go on a holiday and have an authentic Portuguese experience. So maybe – I don't really want to stay in a big international hotel. What's a typical Portuguese place to stay and is nice for a summer holiday?Ana: That's interesting, yeah. In that case, you should definitely avoid the big hotels or any hostels. There are some apartments that you can rent. So you can just live in an apartment by the beach.Michael: All right.Ana: Yeah, they're just in a normal building with other Portuguese people but you can rent it and stay there and it's really close to the beach. It's like a one-minute walk. So it will be really convenient for you.Michael: And this is by the Atlantic Ocean.Ana: Yes. Yes, it is.Michael: All right. That sounds like a very good idea staying at an apartment. How much should I budget for that?Ana: Hmm, I am not really sure. It will probably be a bit more expensive than a hotel.Michael: Really?Ana: Not in the long term. You can pay about EUR 30 per night, I think.Michael: Well, that's huge.Ana: For a nice location, yeah. If you come with friends though, you can also rent a villa. We have some villas also by the beach.Michael: Does it have a swimming pool?Ana: It does have a swimming pool. And they have plenty of room. So if you want to come with a big group, that's definitely a better option.Michael: That sounds like a great idea. I can invite my colleagues along. So do you have any final tips for me, for my holiday in Portugal?Ana: Well, I mean, if you want to stay in the South, in the Algarve, then I definitely recommend you check out the nightlife. I can be really lively in there in night markets where you can buy lots of souvenirs and people just hang around. So I definitely recommend that.Michael: Okay, and what was the name again? The Algarve?Ana: The Algarve, yeah. That's the southern part of Portugal, so you can't miss it.Michael: Oh, I got to remember that. Thank you very much.

英语每日一听 | 每天少于5分钟
第965期:Travel Tips For Portugal

英语每日一听 | 每天少于5分钟

Play Episode Listen Later Sep 6, 2020 3:16


更多英语知识,请关注微信公众号: VOA英语每日一听 Michael: So Ana, you're from Portugal, right?Ana: Yeah, right.Michael: Okay, because I'm actually thinking of going to visit Europe this summer, and I thought Portugal would be a great place to visit.Ana: Oh yeah, Portugal is great especially in the summer. It will be really warm and you can go to lots of places in Portugal. You can go to the North where we have a lot of mountains and you can do all kinds of activities like archery and horse riding.Michael: Oh wow, that's interesting. Well, actually, I was thinking of going to the beach. Can you give me some advice for what's the best time of year to go. And perhaps there are not too many tourists are on.Ana: Oh yeah, if you want to avoid tourists, you should definitely not come in August. August is really crowded and there are just so many people in the South of Portugal. You can try to come in June.Michael: All right.Ana: June is already warm but there are not too many people. So it will be easier for you to find accommodation. There are some really nice hotels and hostels around. So what kind of place were you thinking of staying in?Michael: Well, actually, I don't really mind too much. I think I'd like to see what it's like for normal people in Portugal, what it would be like to go on a holiday and have an authentic Portuguese experience. So maybe – I don't really want to stay in a big international hotel. What's a typical Portuguese place to stay and is nice for a summer holiday?Ana: That's interesting, yeah. In that case, you should definitely avoid the big hotels or any hostels. There are some apartments that you can rent. So you can just live in an apartment by the beach.Michael: All right.Ana: Yeah, they're just in a normal building with other Portuguese people but you can rent it and stay there and it's really close to the beach. It's like a one-minute walk. So it will be really convenient for you.Michael: And this is by the Atlantic Ocean.Ana: Yes. Yes, it is.Michael: All right. That sounds like a very good idea staying at an apartment. How much should I budget for that?Ana: Hmm, I am not really sure. It will probably be a bit more expensive than a hotel.Michael: Really?Ana: Not in the long term. You can pay about EUR 30 per night, I think.Michael: Well, that's huge.Ana: For a nice location, yeah. If you come with friends though, you can also rent a villa. We have some villas also by the beach.Michael: Does it have a swimming pool?Ana: It does have a swimming pool. And they have plenty of room. So if you want to come with a big group, that's definitely a better option.Michael: That sounds like a great idea. I can invite my colleagues along. So do you have any final tips for me, for my holiday in Portugal?Ana: Well, I mean, if you want to stay in the South, in the Algarve, then I definitely recommend you check out the nightlife. I can be really lively in there in night markets where you can buy lots of souvenirs and people just hang around. So I definitely recommend that.Michael: Okay, and what was the name again? The Algarve?Ana: The Algarve, yeah. That's the southern part of Portugal, so you can't miss it.Michael: Oh, I got to remember that. Thank you very much.

The Remote Real Estate Investor
Going From a Nightmare Scenario on Property #1 to Owning/Partnering on 100+ Units w/Tyler Jahnke

The Remote Real Estate Investor

Play Episode Listen Later Aug 13, 2020 38:48


In this episode, Emil and Michael chat with Tyler Jahnke about how he persevered through a nightmare of a first deal to being a part of 100s of unit of real estate.   --- Transcript   Emil: Hey everyone. Welcome back to another episode of The Remote Real Estate Investor. My name is Emil Shour, and today I'm joined by my cohost,   Michael: Michael Albaum.   Emil: And we are interviewing Tyler Jahnke. Tyler has become a good friend of ours and is also one of the writers on the Roofstock blog. So you may be familiar with him on some of the content he's written there. And this was a really fun episode. We got to talk to Tyler about the story of his first rental property. He lives up in the Bay area and he talks about investing in the Midwest and some of the painful lessons he learned along the way of buying that first property and how he's grown to be a partner and owner of over a hundred units through syndication deals. All right, without further ado, let's hop into this episode.   Theme Song   Emil: Tyler. Welcome to the show, man. We're excited to have you.   Tyler: Thanks very much. I appreciate you reaching out and getting my attention and allowing me to hop on today and talk with you and Michael.   Michael: This is going to very much feel like every day on Twitter when we're always chatting about real estate investing stuff. Anyway, it's just on an audio format.   Tyler: A quick little plug for Twitter there, I guess, right? Like most of us I think, met on Twitter and that's been a great platform for both of us or all of us and engaging in and connecting with people so happy. We met there and happy to talk real estate as much as we want.   Emil: Yeah, it's funny. I've been on Twitter for years and I never realized there was this real estate investing and money, Twitter corner of Twitter. Like I always just used it for marketing and other stuff. And I was so stoked when I found this little community that's super engaged and loves talking and sharing best practices. So it's been fun, man.   Michael: It's funny. This is my first live Twitter interaction coming off Twitter. And I'm so glad to see Tyler and I were chatting before we started recording it. And his personality on Twitter matches his personality in real life, which is always great because sometimes you meet folks. It's like, wow, you're really well written. And I can't stand you as a person, not the case at all here, which is always nice.   Tyler: I'll be honest. I was a little worried thinking it just through like seeing you in person, it's like, how is he going to think I come across in reality versus someone who's behind a keyboard or a, you know, a mobile device typing 280 characters. I'm sure there's plenty of people out there that are completely different. And I was like, hopefully I come across similar, online as I do in person.   Michael: I think by the same thing, I don't want to catfish anybody.   Tyler: Yeah. Now I will mention the first thing I noticed about you and Michael was the longer hair. I'll say that.   Michael: For anyone who hasn't seen, the reason they have leveled, they let myself go with the head hair and facial hair department. I'm going out the quarantine cut on, call it.   Emil: Cool. So Tyler, before we hop into the good stuff what's going on in your world, what's new.   Tyler: Oh, that's I mean, that's a big question. So first things first I work full time still. I am not a full time real estate investor. That's something that I think some people maybe assume that I am. So I do work full time in a sales and business role out here in the Bay area, born and raised in Berkeley, California. My office is in as in San Francisco, clearly we're all working from home right now, but so, you know, a lot of my day is still consumed by that full time job. But my nights weekends are still very much real estate or whether that's analyzing deals, talking to partners, talking to investors and networking, engaging, and then doing a lot of content build out on my platform and then just, you know, talking real estate as much as I can on my nights and weekends. So that's kind of what my day looks like right now. It's, it's becoming somewhat repetitive, but I have enjoyed it. And I do try and get out on weekends and hike and see the outdoors a little bit.   Emil: Now that you've mentioned that you live in the Bay, my follow up question is how did you get into real estate investing? And why did you choose remote real estate investing? I think part of the, you answered with you live in the Bay area, but give us the back story.   Tyler: Yeah, I guess I'll tackle the question of how I got in first and then we'll go to why out of state. But so I started investing in 2016, so about three and a half years ago now I was working a good job that I enjoyed in an industry that I also enjoy and still enjoy. But I did see myself, you know, kind of the future Tyler down the line, probably having to work another 40 years and reaching that age of 65 and then maybe retiring. So I think in my late twenties, a little bit of self reflection and trying to figure out what I wanted to accomplish in life. And a lot of that had to do with time freedom, which I think a number of your listeners are probably also conscious of right now, if they're thinking about real estate. And so I had to try and figure out ways to bring an income outside of my W2 job and just try and accelerate my growth on the financial side.   So through business podcasts, through investing podcasts came along this topic and strategy of real estate, which is abundant and everywhere, but no one really thinks about it. I mean, when I say no one, the majority may not really think of it as an investing opportunity. And so, you know, I saw it as somewhat of a logical step and I guess, strategy just by the fact that you could bring in monthly recurring income through tenants, paying off your mortgage and insurance and taxes, and maybe even letting you cashflow a little bit. And then to answer your question on why out of state for me at the time, it was pretty obvious. I couldn't afford anything in the Bay area. And I also wanted that cashflow and it's very hard to cashflow property in Oakland when you're going to pay $750,000 for it. It's quite impossible. Now I'm not saying it's impossible, but there's definitely challenges there.   So, you know, jumping into, out of state investing made sense for me, it was definitely a little scary because you emotionally get attached to these investments. I think as a newbie and you're like, I want to see it in person. I want to touch the front door, but at the end of the day, it's not necessary. If you have the right team on the ground to help you out and really guide you along the way. And so long story short, why out of state, it was affordability and the cashflow potential.   Michael: So I want to know Tyler, how did you make that leap? Really, a lot of people call it a leap of faith jumping into this out-of-state market. Having never been there, maybe having never met your team on the ground, walk us through the mindset and the decision making that you went through to end up where you did.   Tyler: That's the important part is to make the actual leap. And I think I will admit early on, I was rather naive and I didn't have everything buttoned up from an education standpoint. I didn't really know how to properly run the numbers that actually worked for me. I'm not saying, you know, leap in uneducated. I think again, that helped me initially because I was naive in the challenges and maybe dangers of investing at a state. But now thinking back, you know, over the years, my advice to others that are in a position of, okay, I want to do this, but how do I take the next step? I think it can actually be seen as a quite simple process. If you are educated in a market that you want to invest in, if you know how to analyze property, and if you have, you know, the longterm vision of what real estate can do for you, I think that's enough confidence to make the next step.   If you know the market you want to invest in, you know how to analyze property, you have the vision, like it's just going to be a mental at that point. So I don't have the exact advice for people on how to make the next step, because it's completely mental. Once you get those three things down, a market analysis and a vision, once you have that, it's all mental. So it's just going to come down to the individual and some people do it. Some people don't and that's fine. It's just mindset and personality.   Michael: How did you find your first market? What did that look like?   Tyler: My very first property that I bought in closed in December of 2016, I went the turnkey route and I felt that the fact that I had a full time job and working 40 plus hours a week, I felt that the turnkey route would be the best option for me to at least dip my toe into real estate. I will say the turnkey route is not always the best method. If you don't understand the partners on the ground properly, like I found out later. So I went to Turkey about found the market in the Indianapolis area. So the Midwest, which had high cashflow potential good acquisition to price ratio and had some of the metrics of a cashflow market, like population growth, job growth with higher wages, diverse economy. This could be a whole separate topic. So I apologize if I'm jumping too far ahead on what to look for in a market.   Michael: This is great.   Tyler: But I'll say that I hooked up with a drinky company out in the Midwest thought I vetted them properly, picked up a property for $37,000 cash back in the day, which is like the cost of a somewhat nice car. But it actually, instead of depreciated quickly, it's actually an asset that would produce income. So yeah, first property turnkey out in Indianapolis.   Emil: I read your blog a bunch and I know you've talked about the experience of this first property and it's such a good one. And I'd love for you to share the story of, okay, you bought this property 37 [inaudible] on paper. It looks like it's going to cashflow nicely. I'll let you take the floor. Tell us about the story.   Tyler: Yeah, yeah, yeah. So this is the best and worst investment of my life. So best in a sense that it got me in the game, right? I'll keep preaching this, like getting the game, getting the game, getting the game, whether that's a good or bad investment on paper, it's kind of a start that snowball. So yeah, $37,000 cash worked with a turnkey company that I barely vetted. I hopped on the phone a couple of times they started sending me leads via email routinely.   Michael: Did you chat with any other turnkey companies or this was the one?   Tyler: You know, me, you know, I didn't talk to anyone else. So it was all, I put all my eggs in one basket and that's kind of also my personality too. I'm pretty quick to trust and that's a double edged sword, as we all know, I'm usually pretty optimistic and very trusting. So that's good and bad, good and bad. So anyways, I talked to this company, you know, I started getting leads. I started evaluating the properties and my simplistic formula of figuring out how to actually calculate cash flow back in the day. I remember, you know, the estimated rents at seven 50 a month for a property that costs $37,000 napkin math on that was basically okay. Let's give the property manager 10% and let's account for property taxes and insurance. But you know, in my eyes, seven 50 a month, taking away all those expenses, I could probably cash flow 300, three 25 a month. We'll call it, which I wouldn't even touch anyways. My plan wasn't to actually spend that cashflow. So I was like, okay, if I could get a few of these properties in the next five years, you know, now we're talking substantial numbers on the cashflow side.   So I acquired this property and then that's when I decided to fly out. So after I actually close on this property in December of 2016, I decided to fly out to Indianapolis in March of 17. I initially wasn't even going to do that, but my parents were like, Tyler, I think you might want to like meet the people you're working with and just see if that property exists. I was actually kind of reluctant, but now I kind of make it a routine to check on my markets annually. We'll call it pre COVID. So we closed on that property. It takes about two or three months to actually renovate. And it wasn't really a big rehab job. They refinished like the hardwood floors. They replaced a window. They did a little bit of painting.   Emil: The turn-key company is doing that for you?   Tyler: Correct, yes. So the turnkey company, I guess the term turn-key by definition means it should be easy. There are some good Turkey companies out there and there's bad ones. My advice is just to vet them properly, if you go that route. So it took a few months to really quote unquote renovate it. And there were some red flags that popped up initially. And those were some things that I've, you know, looking back I've learned from if red flags are popping up, that you're not happy with in terms of maybe lack of communication or miss deadlines and timelines, I kind of became ignorant or I guess I ignored them because I really wanted to just close on this property and become a real estate investor. And so I think emotion took over and in some points where I was like, you know, realistically, I should have questioned these red flags up front, but I didn't. Cause I was like, real estate is a thing I'm going to acquire 10 properties and become financially free.   So I was too focused on that end goal. Finally got that thing rented. We did have a tenant in there for about 11 months. They paid on time every month, seven 50 a month. I took out, you know, 10% for property management. I made sure I had some reserves for property taxes, insurance. And then I just kind of pocketed that cashflow fast forward to the, you know, as I mentioned that cashflow for 11 months, we'll fast forward to that 12th month. My buddy who's actually in the real estate space as well in the Indianapolis market. He randomly drove by my property just to check up on it. And it was like Tyler, there's a lockbox on the front door. And I'm like, what do you mean? There's a lock box in the front door? Like what, first of all, I was shocked and I trusted him, but I didn't know what that actually meant.   So that caused some alarms in my brain, I guess you could say. It was like at that moment I was like, is this real estate thing gonna actually work? Because that was my first real, real big hurdle. And I guess I had to think through from a business standpoint, what would the next step be? So I didn't mention anything to my turnkey provider. I actually kept that quiet to start with. I wanted to get some verification from others. So I then began the process of actually building another team on the ground out there, aside from the turnkey company I worked with. And that was kind of again, why I go back to like this being my best and worst investment. It forced me to overcome these challenges and build a new team on the ground.   Michael: So Tyler was this turnkey provider also managing the property for you?   Tyler: Yep. They did everything. They sourced the deal. They walked me through the closing process, set me up with insurance and insurance agent. They renovated it. They managed it from a property management standpoint.   Michael: One stop shop.   Tyler: A one stop shop, everything you could have in one box there. Okay. So anyways, I called a couple of property management companies had them drive out there, pay them a little bit money to help me out and just verify that it was in fact clearly that the lock box on the front door meant it was vacant. I don't know the whole story. Apparently the tenant had left without telling anyone and the property was vacant and I was never notified. And that was the last straw. So I fired the turnkey company, had another property manager, take it over. I know this story is kind of going on, on and on and on.   Michael: This is all great stuff.   Tyler: We're getting towards the end of that first property. So after having a new company take over management, after vetting a number of them, I really had to make sure that this next hire of a property management company would be right. So I was on the phone, every lunch at work and at night, just talking to people to try and figure out who the best property managers in Indianapolis were finally selected someone. They went out there, cleaned it up, took over management and they crafted a scope of work on what would be needed to get this thing rent ready. Cause my thought was okay, small little blip in the radar. Let's just get this thing cleaned up, get this thing rented again, get it back on the market and get a tenant in there and then start cash flowing again. And then I'll live my happy life. So they go in there, they craft the scope of work. First of all, I'll say the scope of work was probably a little more than I needed, but it was still a bill for $16,000. And I'm like, uh, wait, what? So, uh, so the property cost 37,000 up front. I need to put another 16 K into this thing to get this thing a rent ready. And I was like, there's no way I'm going to do that. Now along those, you know, the first 12 months of me owning that property too, I think I became a little bit more savvy. I actually, I learned a lot more after I had closed on real estate than I had. And so that's when I started really focusing more on the impact of location and obviously like the partners you work with. So my strategy in owning that first property had actually changed within those 12 months.   And I decided that buying in better neighborhoods with a little bit less risk and a different tenant profile would be the strategy I wanted to take. So ultimately I ended up selling that property. I did not put the 16 K into it. I did not think that that property would have a good longterm outlook. And I started buying in better neighborhoods. So long story short bought the property for 37,000, sold it for 41 a year later, took a year of cashflow minus closing expenses or closing costs. I probably netted, I think it was like 2% in a year. So I honestly call that a really big win on my part. I was like, if I could just break even on that first property, I think there's just so much knowledge and education and experience you get from that first property.   Emil: So why did you decide to keep going? This is, I feel like I've heard so many stories where people, something like this happens and they give up and they're like, ah, this real estate investing thing isn't for me or someone who's new has zero properties is hearing this and is like, I don't ever want to deal with this. Yeah. Why did you keep going?   Tyler: I'll give you a couple answers. Some you may want to hear some of you may not. The first answer you may not want to hear is I already had a second property under contract. So by default I had to keep going.   Michael: That's great.   Tyler: But so I was actually really confident after that first property, given all those circumstances and those challenges, I was like, I know what I did wrong. Like I bought in a bad neighborhood. I hired the wrong people. I just followed, you know, my napkin math. And I touched on this earlier. Like I became better at analyzing properties. So the deals would be better. And then again, like just buying in a better neighborhood with a different tenant class profile, that to me was important. I wanted someone who could afford rent and not be challenged by if their car broke down, that they have to decide between the car repair or rent.   I wanted, I guess, a little bit more security. So that's why I started buying in better neighborhoods. But I felt like, you know, after that first property round to the second property, I had learned so much in that first one, I could do it better and I could just get better every time. And so that was, it actually built confidence. And so, yeah, I went through some short term struggles and I think a lot of people will go through that short term struggle period. But if you really think that real estate is something that's going to be part of your life for 40 years, and it's a longterm strategy that one year of education and challenges will just amplify our growth, you know, as you move forward,   Emil: I love that.   Michael: Such a good story Tyler. I've got a couple of questions for you. And then 11 month period, when you were collecting rent and cashflow, did you think that you were a fricking genius that you had just got a dialed?   Tyler: Yeah.   Michael: Me too.   Tyler: Oh, I was smiling. Every check that came in, the first check that came in, I was traveling with my buddies in Vietnam and I remember waking up one morning and I'm on vacation. Right. I'm on vacation Vietnam. And I got a paycheck. I got a check that came in at like one in the morning and I was like, this is unbelievable. I need to keep buying these as soon as just rapidly. And so, yeah. And it's funny because I started off my journey in the content space by just posting on bigger pockets and I kind of posted my life experience and I love going back online and be like, Hey guys, just want to give you an update. I got my payment, my check came in and I'm good. So yeah, it was definitely all smiles for a solid 11 months until, you know.   Michael: Until it wasn't until it wasn't.   Tyler: And so that's what got me back to reality.   Michael: The learning process that you're talking about and the education process that you're talking about, it seems like that'll happen in month 12. Like that was a massive ramp up for you because for 11 months things were good. So you thought you had done everything right?   Tyler: My education prior to closing was not the greatest, but I really started ramping up the education process after I started closing. So that was, I got addicted to podcasts. I got addicted to bigger pockets. I got addicted to just consuming, consuming, consuming content in the real estate space. And that's why I had my second property already under contract. By the time, you know, all these challenges popped up. So I guess I would say I really started continuing that education process, you know, after I closed and I still do today, even though, you know, I've kind of grown in, in the investing space, but it's podcasts, it's books, it's websites, and it's talking to people like you guys.   Michael: I think that's such a big takeaway for everybody listening is, Hey, after you've accomplished the goal of purchasing that property, whether it's your first fifth, 10th, or whatever, don't stop being educated. Don't stop getting educated because I think too many folks sit on their laurels and think, well, great. I did it. I know how to do it now. Yeah. Well you did that deal. Maybe the next one's going to be slightly different. And so there are things you can learn in the interim that are gonna help make that next subsequent deal even better for you. So I love that.   Emil: I feel dumber now than when I first started. When I first started six months in same thing, I'm laughing, I'm getting checks. I'll just do this 10 times and I'm going to be rolling in dough. And then like reality hits and you learn more and then you're like, wow, I know nothing. The more you learn…   Michael: I think it's because we all started so similarly right? Buy one single family house, your purview is no one can see my hands, but they're very narrow right there. It's a very small scope. And then as we grow and expand and learn and educate ourselves, we realize there's this entire investing world out there that is comprised of so many different things. And we know so little about it. So I think that's a great point. And the old that just further goes to illustrate don't stop getting educated. Can't stop. Won't stop. Right.   Emil: Rockefeller records.   Michael: That's right. That's right. So I'm curious now, Tyler, you, you did that deal a couple of years ago, you know, what are you doing today? Where did you go from there?   Tyler: Yeah. So it's been a journey and I don't want to come across as any type of expert. I'll say that, you know, looking back at my timeline, I've been investing for three and a half years now. So started in my late twenties now in my early thirties, I think there's still a long, long, long ways to go. But I will say within that timeline of three and a half years, my strategies have definitely changed. And so, you know, after that first I learned about, you know, the importance of location and really building that team on the ground. So I bought a second property and other single family house I'm in a better neighborhood with a better team.   I then kind of tiptoed into we'll call it the journey of scaling, scaling up. And so I bought a duplex that was like huge for me. So I went from like a couple single families to a duplex that was me scaling up. I think from my standpoint, my strategy now has changed because like you mentioned earlier, Michael, the education process, there's some things I do now in the real estate space that I was not even aware of, you know, a few years ago. And so I tiptoed around and investing passively in larger multifamily complexes. That's how I started off in the multifamily space was literally, you know, I come in as almost like a silent partner, we'll call it limited partner, they'd say invest in my cash in these larger deals for some equity. And then through that process, learn more about the larger multifamily value of ad space.   And that's where I am now focusing on the value add, but multifamily space, the GP role in these larger apartment complexes. But my portfolio is kind of two prominent we'll call it. We had the cash flowing properties in the Midwest and then the work that my partners and I do in Phoenix on the value of ad side. And like I said, in three and a half years, I've learned so much. And like you said, a meal too, like it's such a massive world out there in real estate. There's so many different techniques and strategies that you can go down into some rabbit holes, but yeah, it's a combination of cash line properties and Midwest plus some value add deals with partners in the, in the, in the Southwest region.   Michael: For those of our listeners who don't know what is that LP GP thing called and what are those roles?   Tyler: The term is syndication, which has good and bad, I think connotations or I guess definitions, but it's really just, it's a partnership between two groups. The general partnership group is generally a group of individuals that are tasked with acquisition of a property lending up financing, building out the business plan, building up the strategy, managing the actual renovation and reposition, and then really making all the decisions on whether to refinance or exit or whatnot. The LP limited partner side is a bunch of investors that come into these deals with some capital and with the intention of really not being involved in the day to day, it's a passive investment. It's like any business that needs, that requires funding and you have the team that's managing everything and then the, like I keep saying this, the silent partners that come in with capital to help fund the project, that's the basic structure of what a syndication is, but it's almost like any type of startup even, or any type of business that needs capital to close. And then you execute a business plan and hopefully pay off, you know, yourself as well as your investors primarily   Emil: I know you're a part of a couple of different indications, your general partner in some where you're more active and your limited partner in some others. Right?   Tyler: Correct.   Emil: How did you decide to get into that? And which one did you start out with? I'm curious.   Tyler: I started out on the LP side after I bought my first two houses and then the duplex, I wanted to experience life, not as a landlord to put it bluntly. There's always going to be some stresses as being a landlord. You know, you're going to have the email from your property manager saying a pipe has burst and we need some money or there's a hole in the roof and we need some money. That's just part of being a landlord. And so I was like, well, you know, at that point in my life too, I was really trying to value my time to one of the biggest things I try and follow right now is kind of, there's a quote out there that says, like start with the end in mind. And I envisioned my life, you know, 40 years down the line where I am selfishly bringing in income without really much active work.   That's kind of what my ideal life looks like right now from a freedom standpoint. And so I was like, let's just try out what this passive investing really is. And I know passive is always going to be a loose term, but I felt that if I could hop into a deal passively and try and learn the business plan and a strategy of what value add is, and then tap into the power of multifamily, which is extremely powerful. We're pretty much doing what people call. Like, I call it the big BRRRR. We're finding a undervalued property, repositioning it through innovation and then bumping rents up that leads to additional cashflow plus increasing the value of the property. So I liked that strategy. So I wanted to kind of hop in there, learn from those people passively and then eventually get into those deals more on the active side events.   Michael: So in syndications, I've only done them locally, kind of with friends and family, never on a big scale, but when you were an LP on your first deal, and you mentioned several times that you learned from the GPS, were they happy to answer your questions as an LP? I mean, how did you go about learning this business as a quote unquote silent partner.   Tyler: It's not like a relationship where you automatically become, you know, the mentee and they take you under your wing. Really what I was just trying to figure out was to slowly get into the game. And that was to begin to just review what a, an offering memorandum looks like, what do these business strategies look like? What do the cost of renovation look like? What are the loan terms like? That was the very first step for me. And as an LP, you get to do that because you're reviewing all of the terms and strategies.   So that was a very, very, very first step of me in education. Now, to your point, Michael, there's no way that these GPS are like, yeah, I'll take, I mean, maybe there's some out there, but I wasn't gonna email them and call in and be like, Hey, can you just tell me exactly what to do and how to do it? They're not going to say yes to that. They have much more important things to do. So really it was just being exposed to the industry and the business plans. That was the very first step. Luckily, you know, after that, the second deal. So the first deal I did was in Louisville as an LP, second deal was in Phoenix, which is now with partners that I work with. So through networking, through connections, through some mutual friends, I was able to kind of position myself in a way where yes, I was an LP, but the GPs actually knew who I was.   And so that led to further opportunity down the line. I'm really just through connection and through building relationships. But yeah. So I think to answer your question, Michael, how do you learn as an LP? There's some you can pick up just by being exposed to the industry, but again, you're not going to have someone take you under your wing most likely   Michael: And hold your hand and say, this is..   Tyler: Exactly.   Michael: Okay. Yeah. Cool. Man, So, you know, I am also a multifamily value add guy. I've always done things on my own for the most part. What is it that you look for in these undervalued deals that are right for syndication? If you had to pick two or three things that like, yep, this is going to make a screaming deal. What are they?   Tyler: The first thing I will say is I am no master of acquisition. That's not my role, but luckily I have partners on the ground that are, you know, educated and know the market much better than I do. But really what you're looking for is, as you mentioned, is undervalued property. And that in the multifamily space can be something that maybe it's mismanaged. Maybe they have a lack of capital to make any renovations. So, you know, the properties that we're acquiring generally are occupied pretty well in our market, which is Phoenix, but they're outdated. And because of that, rents are lower than what they could command. So that's one area where value add is really, you can take advantage of is just an old dilapidated property that maybe mismanaged, maybe you're not even collecting rent properly. There's just so many different areas in where you can find that value add. So to answer your question, I mean, what we're looking for is a specific type of asset that is in need of a cash infusion because the amenities are not the greatest and can definitely attract a better tenant with a higher rent.   Now we're also kind of in areas and neighborhoods where there's actually a lot of class A stuff going up. And so we're, we're buying things that we think we can reposition to be just under class A, to kind of create a little bit of a subclass. So similar amenities, you know, the grant granite countertops, the under Mount sinks, new cabinets, washer, dryer in unit, the dog park, that, all that stuff, right. So we're building a property that's right under class a but more affordable. So we're kind of creating that subclass and that's, I think another way that we're protecting ourselves and being able to draw in that tenant and be able to bring in that rent that we've backed. So yeah. Undervalued property and then creating that subclass is what we do.   Michael: Love it. I do the exact same thing, just on a much smaller scale. That's great.   Tyler: Yeah.   Emil: So you've been on both sides, you acquire properties yourself, you've been part of syndications. Do you have a preference of which one you like, or do you kind of mix and match in both in you kind of see that happening in the future?   Tyler: Yeah. I see myself mixing and matching. Like I mentioned, I have kind of two prong attack of the cashflow, the immediate cashflow in the Midwest right now. And that portfolio is small and I still have some time to keep building that thing up. I, you know, I still am attracted to the immediate cash flow of those properties in the Midwest because the bigger deals are great, but they're a little bit more of a longterm play for me. If anyone is familiar with how this structure works, you know, you, as an LP, you get paid out quarterly as a GP. You know, the big pallet kind of comes at the end when you exit. So that side of my portfolio is more of a longterm play. And when I say longterm, we're talking five to seven years, which really isn't super long term. But I think having a combination of both is really a nice way to diversify having that cashflow from the Midwest or wherever your market is in individual properties that I own personally mixed with the passive income on a syndication and then a big pile. Hopefully once those properties are sold and you exit. So I think ideally I continue to keep attacking those two prongs, keep building those portfolios side-by-side and parallel.   Michael: So Tyler, something we talk a lot about in the restock Academy is about risk adjusted returns and that, you know, in the more risky areas we should anticipate and expect and really demand a higher return and the less risky areas say for investment, we could expect a lower return where you willing to give up a little on the cashflow or on the return side of things, making that transition over to a better neighborhood or a more expensive neighborhood.   Tyler: A hundred percent. Yeah. I don't think I had the specific data on what that would actually look like.   Michael: Sure.   Tyler: But to me, even just from an emotional standpoint, I was like, I'd rather have an investment in a neighborhood with better schools, less crime, you know, community amenities, a grocery store. Like I felt that I was a hundred percent willing to take less cash flow for a better neighborhood, but also on the flip side, generally in a better neighborhood, you might have better appreciation as well.  So it's almost like right to me. Yes. I wanted to get out of that CD class neighborhood, get into that B class, we'll call it on my personal portfolio. I'm already seeing a much better appreciation numbers on that side of things. And it just, there's a lot more comfort in, in, in knowing that you have a property in a, that's not in a war zone, it's not crime ridden. You know, it, it's a good suburban neighborhood with consistent cashflow and, and most importantly, a tenant that's going to pay on time. That to me was a lot more important than the amazing numbers on paper in that war zone. That would cause me more headaches.   Michael: Yeah. You bring up such a great point that, you know, on paper and mathematically and physically, sometimes those properties in the war zone pencil out really well and might even perform really well. But there's the mental health side of this business too. And, and I think that's so important so often gets overlooked of, yeah, I can make a killing over here, but I'm gonna make myself crazy and not sleep at night. And so we often say that there shouldn't be emotion when it comes to investing, but there is sometimes is. And that, you know, based on how it makes us how the investment makes us feel from an owner and operational standpoint, I think does need to get factored into the calculation   Tyler: A hundred percent. Yeah. I'm all on board with buying, you know, it's not the A-class stuff that, not the D class stuff somewhere in that middle, you know, BC area. That to me is the most safe investment, at least in my opinion.   Emil: Right. You see a lot of people, you know, they'll, they'll flash the similar situation, right. 35, 40 K home it's renting for basically the 2% rule. Right. So it will be running for seven to 800 and it's just like, it looks so good on paper, but there's all these other risk factors that you have to adjust for. And you have to have the appetite for like, dealing with messes more often than something in a better class neighborhood. So always important to consider that   Tyler: Nice little segue to there on like just evaluating cap rates too. Like people will flash, Oh, I got, I got a 12 cap, right? It's like that's numbers. But like, if you look at it from a perspective of risk versus reward, that's probably going to be a more risky investment than a six or seven cap, you know? So it's been interesting to kind of learn that through the years to that high return on paper, doesn't always mean a high return in real life.   Michael: Well, and also what's your time worth. If you've got to go spend 20 hours a week dealing with a 12 cap property, or you can spend two hours a month dealing with a six or seven cat property, you have the opportunity now to go buy more, you know, go buy two or three of those six caps and make us the same or even better returns. Yeah, absolutely. I think that's such a valid point.   Emil: So we've been ending a lot of these episodes. We used to quick fire questions. We've been transitioning into…   Tyler: Slow fire?   Emil: Think about this for five minutes before you answer. No, it was just a random question that we just kind of riff on.   Tyler: I'm all about that, man.   Emil: I know you travel a bunch. Where's the first place you're going to travel to once all the restrictions are done and like, we can start moving around again.   Tyler: I actually had a flight booked to Paris that I got super cheap and my buddy and I were going to go out there and explore the Dolomites in Northern Italy that is still in the back of our heads. And if, and when travel restrictions kind of open up, I think that's where we might go as the Dolomites in Northern Italy.   Michael: I was just there in January Tyler. And it's unbelievable.   Tyler: Yeah.   Michael: Unbelievable. You can go in the winter. I don't know if you're planning on going in winter or summer, but the ski, like the snow sports, they're the snowboarding skiing, snowshoeing is unbelievable.   Tyler: The plan was to go this summer actually, but just seeing photos of it is like, we were inspired to just find a way to get there. So that would be the first destination.   Emil: I'm looking at pictures now. Cause I had never even heard of it. And it is…   Tyler: I hadn't heard of it till recently as well, but yeah, the Dolomites.   Michael: They get, I think the most sun out of anywhere in Europe, in winter, they have the most like sunny Bluebird days and yeah, just don't have enough good things to say about it. Emil, where are you going to go?   Emil: Well, now that I have a kid makes traveling, you have to think a little bit more. You're like, Hmm, where can we go? That's kid friendly and things like that. Probably a surf trip. I'm thinking Costa Rica, Costa Rica is like one of the more family friendly areas that has really good surf. That's not too far from Southern California. So probably Costa Rica, friends. And I have been talking about doing a trip down there for a while.   Michael: Right on.   Pierre: Michael can we get your synopsis of Costa Rica since you live there as well too?   Tyler: We now have a travel podcast guys!   Emil: Hey this is The Remote Real Estate Investor.   Michael: Bait and switch everybody. Yeah that Costa Rica is awesome, man. It's a super, like you said, I know it's a super easy, but you've been there before, right?   Emil: Yeah, I went there like seven years ago with a buddy. Yeah. Different type of trip.   Michael: The surf is so killer. Yeah. You were also Nicaragua. We talked about that to you, right?   Emil: Yup. Nicaragua's surf is amazing.   Tyler: You've also mentioned Bali to me, Emil as well.   Emil: I sound really cool right now. Cause have you guys been there. I've been there, but yeah, Bali, I need to go back to Bali. It is like surf paradise and there's so many good waves and I will probably watch a video on YouTube three times a week of incredible waves there. And I'm just like drooling. But anyway…   Michael: Drooling at waves.   Emil: That's right. That's right. What about you, Michael? Where are you headed?   Michael: I think I have to go back to Portugal. I'm purchasing some investment property out there and sort of do some paperwork type stuff we need to get back out there.   Emil: No big deal. Just buying a property in another country.   Tyler: Are you going the Airbnb route on that.   Michael: Yeah. So it's the Airbnb it's like professionally managed, but actually we're applying for what's called the golden visa so we can get our permanent residency status and ultimately citizenship out there as well to be able to live and work and travel in the EU without needing…   Tyler: Awesome stuff.   Michael: Yeah. So we're pretty pumped on that.   Tyler: My buddies living in Portugal right now and he's just been working abroad for the last year. He did, he actually did Costa Rica for a while and then just flew to Portugal. And he's, he's actually writing a book right now about working from, uh, working abroad.   Michael: That's awesome.   Tyler: I'll connect you guys with him.   Michael: That would be great. That's something that I did last year too, is a lot of fun. I've actually been to Costa Rica, Latin American then all over Europe. Portugal also has amazing surf, has amazing, awesome waves. Pierre, where are you headed, man?   Pierre: I was thinking to go to Mexico, but I'm out of maple syrup. So I might have to go up to Canada.   Michael: Get up to Canada.   Pierre: Yeah.   Emil: Can't live without that maple syrup.   Pierre: No man.   Michael: It's a lifeblood.   Pierre: It really is.   Tyler: I mean, you even have a piece of bark on your wall back there, it's like yeah.   Emil: It's probably a good spot for us to end this one. Tell her before we let you go. Where is a good place that people can get in touch with you? Maybe ask you some questions.   Tyler: My website is jump in real estate.com. You can find my contact info. They're always happy to hop on a phone call or even just exchange emails with anyone really, really enjoy chatting with people like yourselves. And I'm sure your listeners as well. So I just love talking to real estate.   Michael: Awesome. And Tyler if someone wanted to be an LP and one of your syndications is your website the best place for them to get in touch with you regarding that type of stuff as well?   Tyler: Yeah, I would say that's probably the main route I'd want people to kind of route to me is the website. So jumpinrealestate.com. There's an ask Tyler tab. You can just find my contact info there and, or follow me on Twitter at jumpinRE very active on that, which I talked to Emil and Michael pretty much daily on.   Emil: Yes, follow Tyler on Twitter. Very good follow. Awesome man. Thanks again so much. Really appreciate you coming on.   Tyler: Thanks.   Michael: This was so awesome.   Tyler: Definitely. Thank you both.   Emil: All right, so that's our episode. Thanks again, everyone for tuning in. Before you go and make sure you subscribe to the podcast, you get an update every time we release a new episode and let us know what you think of the show. We're always looking for feedback, leave us a review. Let us know you think what you want to see more of maybe what you want to see less of and we'll catch you in next week's episode. Happy investing!  

The Remote Real Estate Investor
Should You Put Your Properties Into an LLC? We Asked a Real Estate Lawyer…

The Remote Real Estate Investor

Play Episode Listen Later Aug 7, 2020 46:09


In this episode, Michael and Emil speak with real estate lawyer Kellie Chrisman about the pros and cons of LLCs and Legal entities in regards to protecting your investments.    --- Transcript Michael: Hey, everybody. Welcome to another episode of remote real estate investor. I'm Mike Albaum and as always, I'm joined by..   Emil: The good ol' Emil Shour   Michael: And today we've got a very special guest in Kellie Chrisman, who is actually a real estate attorney. So today we're going to dive deep into all things LLC and trust related. And Kelly is going to answer a ton of our questions. And for those of you who can't make it through the episode, cause it does get a little bit long, make sure to listen to the end of the episode where she gives her contact information in case you have any real estate specific questions for Kellie. So let's go ahead and jump right in to it.   Michael: Kellie. Thank you so much for taking the time for joining us today. We really appreciate it.   Kellie: Yeah, no problem. Thanks for having me guys.   Michael: Absolutely. So I was hoping you could give our listeners a little bit of background on you, you know, where do you come from? What kind of law do you practice and we'll start with there.   Kellie: All right. Sounds good. So I'm originally from Northern California, Chico and I have been practicing in California for seven years college at UCLA and couldn't leave LA and we stayed down there with Loyola Law school lived in Santa Monica, practice down there, my first, probably four or five years, and then moved back to Sacramento to be closer to family and go all over California and practice all sorts of exciting law that no one usually likes to talk about unless I get real estate people, or unfortunately somebody's going through a hard situation. So I do trust the States business planning and then estate planning as well. And they all kind of intermingle and go together. And it's interesting.   Michael: It's very interesting. And in full disclosure, Kellie and I have done quite a bit of work together in the real estate arena and the trust arena. And now I think Emil has now as well, right?   Emil: Yes. From your referral. So thank you.   Michael: Another convert to team Kellie.   Kellie: That's right. But I can't confirm unless you guys can confirm. Attorney client privileges.   Michael: Awesome. Well, Kellie, I was hoping we could jump into kind of the meat and potatoes of what we want to talk about today and start with some definitions to give folks, because I think so often in the real estate realm/arena, people throw around terms without really defining what they are. So for those of our listeners that have no idea, I would love to just run through some definitions of maybe sole proprietorship, LLCs, S Corps, C Corp and trusts. Can you break down for everybody? What those are?   Kellie: For me, I am a visual learner, which doesn't work necessarily here, but I can at least try and break it down. And I always have to give the disclaimer, I'm not getting legal advice, getting general recommendation based on things that I know. And we can always talk more detailed than I can get legal advice. I see those as two different things. So a trust is, is in its own category from the sole proprietorship partnership, LLCs, Corporations S Corp C Corp, cause they're really accomplishing two different things. So on the most basic level, the trust is something that's going to plan for worst case scenario. So something bad happens, who's in charge where everything is going and what you want that. Then we get onto the other side, the entity side, every other kind of thing we've mentioned. And that's the type of business or entity protection liability protection. So sole proprietorship is if you are going to own a rental property and you don't do anything, you are automatically. So if there's nothing you want to do, you can of course draft stuff and make it more.   But on its most basic level can do nothing. That's what, no, if you do nothing with someone else, then you are a partnership. You can automatically be a partnership. If you do nothing, or you can spend a lot of money to draft beautiful documents and be a general partnership. They're taxed at the individual level, LLC is a limited liability company. And a corporation is both of those. Together are something you file with a secretary of state, whatever state you live in and they give you liability protection so they can have one member. It can be just you, it can be you and a sibling or you want a friend or it can be in corporations and Apple has countless shareholders. So it can go from there, LLCs, the incorporations provide that protection. And then within a corporation you can be two different texts, escort, which is a closely held corporation or a C Corp, which is what we're most commonly used to. So like an Apple or a year, it can be somebody small.   Michael: So if I'm hearing you right, if I just bought the property and do nothing, I take title in my personal name. I'm a sole proprietor. Yep. Okay, cool.   Kellie: And if you do nothing with a friend, then you're a partnership.   Michael: Got it. Okay.   Emil: Yeah. I was going to ask. Okay. So I think for people listening, what are you potentially opening yourself up to? If you're a sole proprietorship owning real estate, what are the risks?   Kellie: Okay.   Michael: How deep do we want to go down that dark dark?   Kellie: Don't ask the lawyer that question. So I don't like to scare people, but I always like to be realistic and everybody has their own comfort level. If you are a sole proprietorship, you are leaving everything on the line. So to put it in real estate terms, you, if it's a commercial property, somebody walks into your tenants property and they slip and fall on the curb. You are technically responsible in certain situations, most situations for keeping that curve maintained and safe. So if you get sued, everything you own is on the line, your home, all your other property, your retirement, your income, and it can follow you. So you can get a judgment that you might not have a lot now, but in a little while. Well, so the risk, if you have nothing, that's huge is everything. However, how common that? It's not so, but not so uncommon. I mean, it can be something as simple. If you have a rental property, I had clients that their tenant had a party to make people on the balcony and somebody moved on the ledge. And once we went over and got hurt, whether they're reliable or not, they're included in the lawsuit. So there can be a lot of expense just to prove you're not liable.   Michael: Versus going the LLC or corporation routes. Now that's a very different scenario that we're looking at.   Kellie: Yeah. So then we're looking at the only thing on the line is what's owned in that corporation or LLC. So you cap your liability and we'll talk, I'm sure a little bit about how that happened and how to maintain that. But if I don't have something in place, everything you own is on the line. If you do have a corporation or an LLC, then just whatever is held in that corporation of the LLC. And so a lot of times you'll see corporations or LLC get sued and then they go bankrupt because they're not going to put more assets into that and they'll have to be other risks. If you just have to go back to the most question, if you just have a sole proprietorship or partnership, you know, if you don't get along with with your partner, if you die, what happens to it? If something tax wise, there's a lot of stuff you can do within this corporation, that instruction. So it gets very strategic and fun if I can say that.   Michael: Yeah. So it just sounds like you have, from a very high level inside an entity structure, as opposed to a sole proprietorship, more options and more liability protection than if you're just a sole proprietorship, is that accurate or fair to say?   Kellie: Yeah, I think that's fair to say. There's a lot more that you can do and there's a level of comfort that comes with it.   Michael: Sure. Okay. And so I get the question all the time of Michael, do I need an LLC to invest in real estate? And I think in the real estate community, there's this very hotly debated topic of pro LLC. No, LLC. So it sounds like we touched on, you know, what the pros are of having an LLC. Are there any pros to just being a sole proprietorship that you really lose out on if you have an LLC?   Kellie: Yeah. So, and it's funny cause I I'm preaching all of this and, and I just went through it as an attorney. You know, whether I want to become an LLC, a limited liability corporation or whether I want to stay the sole proprietor. And when I talk with my accountant, who is usually my they're usually the person that I work with clients tax wise, there can be consequences. So if you do create an LLC, obviously the first thing is that there's a cost associated with it, just filing it with the state. The state has asked me, um, to create it. Usually you're, you're going to need to either pay somebody to do it, or you're going to buy a package online to do it. And there's some things that come within each state that you have to do. So in California, for example, you have to then start paying payroll taxes. So rather than in a sole proprietorship where I just pull my stake and then I get taxed at my own level, I now have a couple of additional tax requirements, but at a point it becomes worth. So that's where I always recommend working with a CPA or a tax professional.   Michael: Okay, great.   Emil Like let's say I buy a property in Florida. I decided to put an LLC, you can set up the LLC in Florida, but California will still require you pay like the franchise tax fee. Like you're an LLC, here right?   Kellie: The problem is, the government writes the law, um, and they always find a way to get their fingers on a little bit of something. So if you have a corporation or an entity in another state and you live in California and you're essentially running it out of California, which is, I own a rental property that I rent, but I received my rent and my California bank account, you have to register as a foreign entity and you pay a small fee to do that. But that's one of the costs of doing the upside of that liability protection.   Emil: Totally   Michael: Wait. So did I, maybe I misunderstood that. So if I own property in Ohio, but I live in California and I registered my, I created my LLC in Ohio and registered it as a foreign entity in California. Should I be paying the $800 annual California franchise tax fee?   Kellie: You do what it is for a foreign corporation, whatever they require for that.   Michael: I got, I got to take a closer look at that. Cause if I've been overpaying, I got to talk to somebody that's ridiculous.   Kellie: That's why I say, talk to your tax professional. Michael: Right, right. Right. All right. Cool. Well, I will definitely have to look into that then, but so for, in California, I mean, there's really no way to get around telling California that we have even a foreign entity in California if we're living here, right?   Kellie: Yeah. They're going to figure it out because the second you file your income taxes, you're going to have that income from the corporation. And they're going to say, Hey, right. So it's a small price. You take my lawyer hat off. And $800 is not a small price for me, but I put my lawyer hat back on and I say, this is $800 is a small price to pay. But when you're looking at the amount of money that you're investing in, what you're building and hoping to gain from creating an entity in front of investing in multiple properties, it's really a drop, hopefully, in the bucket in the grand scheme of things.   Michael: Sure. And kind of getting back to that original two camps, right? The pro LLC, the new LLC. I think the biggest argument that the no LLC camp makes is that, Hey, I can get the same type of asset protection of liability protection with high liability insurance limits and then get an umbrella on top of that. What are your thoughts around that?   Kellie: Yes, super common. It just… This is such a lawyer answer. It just depends. So I worked with a medium sized firm here in Sacramento and that's what the partner is. He would tell clients, you know, why spend $800 a year when I can buy you a hell of an umbrella policy? And I agree with that in some situations, and I don't agree with it and others. So there's no the person that, you know, maybe they bought their first house and they're going to keep it and buy their next house. Never going to be a longterm investor. That makes sense. You know, if it's a single family home that you're renting, that's a good amount of insurance. But if somebody slips and falls in that house, I mean, slip and falls was one of many things that can happen. It's just common place. Example. You're hoping, and you're, you're gambling that you bought enough insurance to cover that lawsuit and your lawyer fees.   Because if you didn't, then now everything was on the line. Now that dream home you bought is on the line for this rental home that you have. A lot of times it works in, comes down to, and I'll probably touch on this throughout. It's how risk averse, how well you're going to sleep at night. Wonder, I always use the example of my husband. And so I I'm a little bit of a gambler. We had one property. I don't know if I put it in an LLC. I probably would seeing, having seen other things that I had done and worked on my husband is extremely risky because he's an engineering he would, before we bought the property, he would have an LLC set up. He would make sure everything was like perfect and Excel and everything. And it would be, everything would be in separate LLC, which I'm sure we'll talk about too. So it depends.   Michael: Yeah. I love that answer. Cause I think so many people approach it with a one size fits all, but it sounds like you can't look at it through that lens.   Kellie: No. And every situation is different. Every set of facts, if it's commercial property and they're going to be multiple people on this property every day, if there's going to be any kind of manufacturing, any kind of longterm structure to me, that's a no brainer. I would advise my clients to immediately do it and have an entity in place. But it just depends if there's an accident.   Emil: Yeah. So one of the questions we wanted to ask you is how do you handle insurance if you're using an LLC, does it differ if you're a sole proprietor versus LLC, do insurance companies look at those differently?   Kellie: So you talked to your insurance agent and each insurance company is going to handle them differently. A lot of times you will insure the LLC itself or the entity LLC, or corporation, and then insure yourself separately. So you can, I mean, if you're extremely risk averse and we send it, my husband would probably have insurance on the LLC and then we'd have an umbrella personally, over ourselves as owners of the LLC as well. So you're, you're double protected, but each insurance company saying that a little differently.   Emil: So you don't insure the property, you insure the LLC. So if I acquire more..   Kellie: So you would insure the property, but the property is going to be owned by the LLC itself. So if you're insuring you can insure business and then you can insure the property, but you're likely going to do both. And if you have a mortgage on the property, they're likely going to require that you meet the minimum requirements, ensuring that properties.   Emil: Right. Got it.   Michael: So let's just take an example. I've got two properties, both in the same city, both currently insured with the same insurance carrier and I move one of those properties into an LLC. Can I use that same policy, so to speak, that'll cover both properties or do I need now a separate insurance policy for the LLC property and then a separate insurance policy for my, the one I own my personal name.   Kellie: Yeah. So I'm going to punt to your insurance agent, i'ts going to depend on what they want to do. So, and it's interesting because this area of law is something that's rapidly developing and becoming more common. I think that a lot of smaller investors are becoming more sophisticated. And so now they're looking into these LLC avenues and now lenders and insurance agents are catching up. So I've had clients who, that's not a problem. They're able to do that and just list the entity as a second finer or additional party. And then some insurance companies will say no way, you're not touching separate policies now. So it's just gonna depend on your insurance agent.   Micheal: Okay. Something that I know we've talked about in the past, Kelly is commingling funds and we'll kind of get there in a minute, but I want to talk about maybe commingling insurance. So if the insurance company is okay with it, right, they're happy to write both my LLC property and my property owned in my personal name on the same policy. Can someone look at that and say, Hey, look, he's insuring these two things on the same policy just cause the insurance company is okay with it. Does that mean it's, I'm safe from a legal perspective.   Kellie: That is one that I have not encountered before. I believe you would be okay. Simply because you are, you're listing them separately as separate entities. I mean, if you want it to be perfectly safe, have no, you know, gray line. I wouldn't have them completely separate because obviously that's the easiest way to never have it come up in court. There's even an insurance policy that's owned, but I don't, we're looking at the commingling is whether we it's, what's called pierce the corporate veil. And I don't think that the insurance policy would do that on its own. You would have to also be doing additional things. So if that's the only thing you're, you're doing that it shares an insurance policy. I don't think it would be a problem. I don't think that would be enough for the court to look at you and say, Hey, he's treating this corporation or this entity as if it's his own personal bank account as if it doesn't really exist. However, if you're also buying all of your groceries out of the bank account and paying your, your home mortgage and buying all of your diapers, that's going to be like completely different analysis. From the court's perspective.   Michael: I thought I told you, I haven't worn diapers in years.   Kellie: I didn't know. You know, it's this whole quarantine thing.   Michael: This is kind of a nice segue into bank accounts.   Emil: Okay. So if I'm using an entity structure like an LLC, do I need a separate bank account for that?   Kellie: Yes, it's very quickly. So the biggest thing that you want to do, and then the purpose of the corporation is going to call corporation LLC interchangeably. Unless we're talking about structure, purpose of the entity is to protect you. And we have to create the corporate veil. We have to create the entity and maintain it as if it is a real thing, because it is. So one of the things, the most basic thing to do to do that is to create a bank account, which is very easy to do. They usually want what you filed with the secretary of state. And what's called an EIN number, employer identification number, which is it's very easy to obtain, or your attorney can do it. You can really do it. It's a little dicey. One of those things that might be worth having your tax professional or attorney do and the bank will create it.   That shows that you are intending to treat them separately. You are intending to honor the law and keep things separate. So it's the first line of defense that I just show that you have created the entity. It also makes me, so you set up your entity, you create your bank account and now, you know, what's coming in and the most basic level, you put all your income for the business, they're all your rent checks. And then you pull all of your premiums for insurance or whatever you need out. And then you can pull your hat when the time comes. So, I mean, I told her the first thing that I recommend the clients do and I recommend they do it.   Michael: I often get the question, you know, how do I pull money out of this LLC account? Cause I'm the LLC owner. I'm ultimately the owner, but I'm setting up this corporation a structure to limit the liability exposure. So once I received the rent, all the expenses get paid out of that account. Can then I just move that money from the account into my personal bank account.   Kellie: Mhhmm. So by putting it in the business bank account, first, you're creating a record. You're saying, Hey, this money, this check that I cash was right. And here's where I put it in. And here's where I pulled it out. And this is my thing. So if you are non-graded record keeping and your accountant is not going to, it's going to make it easier for them to do their job for you to pay your taxes. And it also from a legal perspective, shows that you are, you know, you're, you've created an entity in your needs, so you have honored it. You've used it. You've put it in there. You've pulled out the money to yourself. You're not using that business account as nerd ATM or debit card.   Michael: Okay. So if I wanted to take $50 from my business to go buy groceries, instead of going to use my business debit card at the grocery store, I should simply move the $50 out of my business account into my personal account and then pay for it with my personal debit card.   Kellie: Yeah. Or put it on your personal credit card and then use the business account down the road. So you pay yourself and then you can pay that off. Okay. Now, if we had a CPA on or an accountant, they'd be saying, well, what are you buying? You know, are you buying, you know, the business expense can now, can we have them leave? I mean, that's my dream. CPA is trying to figure out how exactly they can make it work with business expense. But the point is that you are not intermingling your day to day life with your business life. You're keeping them separate.   Michael: Got it. You touched on it a little bit ago and I just want to circle back to it. So let's say somebody is interested now in setting up an LLC, what do they do? Who do they call? I mean, they can obviously call you, we'll give everyone your contact information at the end of this, but what are the steps involved with setting up an LLC?   Kellie: Yeah. So this is an ongoing debate. And I love talking about this because in the most common thing I hear is why can't I just go out and buy this package that I found online for $95, that's going to do it all for me. Why would I pay you? And it's as simple as you just need to file the required documents with the state that you want to create your entity. That's what you have to do on the most basic level that creates your entity. And then from there, you need to build off. So depending on whether you have an LLC or corporation, there are certain documents that need to go into place. So when you file either your articles of incorporation or articles of organization, so organization is the LLC corporation is corporation with the secretary of state. From there, you're going to need that EIN number to help you set up the bank account.   You're going to need the documentation to support and show that you created. So just like we create the business account and we don't intermingle funds where we're showing we've created it by having that business account. We're also showing we've created the entity by having the paperwork that supports it and actually creates it in place. It's fairly common that I have clients come in and all they've done is file. Well, I created it and I'm paying my yearly fee and that's all I have. And when I asked them, you know, who's in charge, if you die or what happens if you and your partner disagree or who, you know, who's the treasurer, who's this, then people go, I don't know. I didn't do that. In that time I bought packaged. I didn't thought paperwork, or I just signed it. I bought that, but I didn't read it.   I don't understand it. Yeah. They have the skeleton in place, but not the details. So I mean, ideally what you're setting up when you, when you do it, you're filing and you're setting up the background paperwork and getting all of the documents. You need to have a successful business going forward. If you do it right at the beginning, you build on it and you have, and you're confident in this round foundation. So if you're going to invest the money to do it at all and the best, the annual fees, then why not just do it a little bit more into it. Right. So that you don't ever have [inaudible].   Michael: Yeah and if we did have an accountant on the show, they would tell us that that's a startup expense. So keep track of it.   Emil: I think we need a follow up with an accountant and Kellie!   Kellie: Love that.   Emil: Imagine the nuggets we're going to get out of that one.   Michael: Oh, the fireworks will be flying.   Kellie: I'm sure. Just agreeing with each other. I'm sure.   Michael: Right, right, right.   Emil: I actually want to run through my personal scenario. I think there's some stuff we can pull out for listeners. So when you and I started working together, I had almost all of my properties in my personal name. And I got married a couple of years ago, had a daughter and realized everything sitting in my name there's issues with that. Right. There's… if something happens to me, obviously that doesn't happen. But something happens to me. There's something called probate that I wanted to avoid. Can you really quickly just touch on what probate is?   Kellie: Yeah, so it's the thing people don't like to talk about.   Emil: I'll explain where I'm going with this after.   Kellie: Super important, because I mean, so probate in its most simple form is a court monitored administration of an estate, of somebody's assets. Once they die, it is not the state taking a percentage of what you want. That's the most common thing I hear probate is a nightmare for a host of reasons, mostly being that it's lengthy, it's public, so everything you all is public and open to really looking at it. And in some situations, if you have nothing in place, it goes according to law. So it's going to your kid. Right. And who's getting it in the meantime. You know, if your kid is, you know, one or two, like I know I have, you know, who's watching it for her and do I want my 18 year old getting access to everything that I own at 18 years old? No. So probate is a little bit, but a fun nightmare.   Emil: Yeah. And I had a family member deal with it and which is why the alarm sounded off for me personally. And so that's why I decided to put these properties in a trust again, moving them out of just my name, avoiding any headaches. If anything happened to me, you touched on what an LLC is just real quickly again, what is the advantage of the trust?   Kellie: Yeah. So the trust is going to say where everything goes when you die and it avoids probate. So they work together a trust and an LLC. They're not a trust is not going to give you liability protection. I wish it could. I could save my clients so much money. I can trust you liability protection, but a basic revokable trust does not. And really for anybody young, that's all I'm recommending because you don't want to buy property you can't sell. The trust is going to allow you to say, if something happens to me, here's where I want it to go. I want it to go to my daughter. When she reaches the age of 25. If she goes to college, I want everything paid for, you know, she needs a car.   She can have a camry she doesn't need a Ferrari -- because her dad likes cars. And you know, she graduates from college. She can have 10% or it's a little incentive if I'm not there to help her. But if you don't have kids, it can become even more important. You know, where do you want it to go? You want parents to have it. Do you want your siblings to have it? Do you want your girlfriend to have it? Do you want a charity to get half? You can be super creative. And then from, I think a more important level, if you are in an accident and you're in a coma, who's maintaining everything that you have. And so we want to make sure someone's collecting the right on your property. So once paying your insurance premiums so that you're in a coma, and if you have the worst year ever with 2020, you never know you're in a coma and your property catches on fire. We want to make sure that your transplants are paid and everything is contained. So when you wake up, your life is the same.   Emil: Awesome. Yeah.   Michael: And are there any financial benefits to not going through probate?   Kellie: Yeah. So probate, the fees are set by law. So especially here in California, a percentage of your estate goes to your attorney and a percentage of your States into the person that's running it. So it's an executor administrator. They get it generally is about two to 3% of your estate goes to your administrator. And two to 3% goes to their attorney, being an attorney that practices this all the time. I don't handle a probate that I don't pick up. The probate code. There is always something weird. There's never, and it's kind of a running joke about people that do this area of law. I don't think it's boring and it's, it's shocking how not boring and bizarre. And it's so it's hard to go through without an attorney. So I've worked for firms that they get great deals on wills because a will is perfect.   The trust is not people go, wow, you paid $300 for a will. Or I paid 3000 for a trust. That's ridiculous. I'm getting a will. And the reason attorneys are doing that is because down the road, they're going to be making a lot more money off of you, probating your will. Then they're going to now, if you set up your trust and do it right the first time, not a little attorney, we of, we joke in our, in our industry kind of about, you know, people oftentimes will go do it themselves. And I always tell clients, great, go do it yourself. And then let's have a free consultation. I'll read through what you put together and I'll tell you, honestly, you know, I'm not going to charge somebody money if I don't need you. That's not why I'm in this area of law. But a lot of times people will do it themselves. Think they've done it and they don't execute it. Right. They put something in there. They don't intend. So we hear their properties going where they don't want it to, or it's not valid at all. And the attorneys then making more money than they would have the probate, because now we're fixing what you did wrong through whatever software was cheaper around, seemed like it was cheaper, I should say.   Michael: So. I mean, we just kind of glided over that fact, but I want to circle back to it. If I have a will in place that does not help me avoid probate, I might be able to dictate where things go and to whom and when, but I still got to go through probate. Well, my, whoever is around has to go through probate. If I've got a trust, I can also dictate where things go to whom and when. And I can avoid paying that two to 3% fee   Kellie: In the probate. It's attorney's fees and administrator executor fees. So probate is if I have nothing in place, then it's probated and it goes disposition or where it's going. My state, it goes according to law and the law assumes your kids are going to get it as soon as their legal is in 32. And if I don't have to, it goes to my parents. And if I don't have my parents, because my is, and news is full. That's how you hear these people that didn't long loss, fifth cousins or whatever.   Emil: I remember when we were going through the process of doing this with you. And I'm like, after this person, I just don't know who else at this point   Kellie: We always, so in that case, what we always do and you'll see in any well drafted will, it will always say, and if everybody's gone to their heirs at law, because if I'm going to keep making, like, I call it like the worst car accident. So if you tell me, okay, I want it to go to my wife and my daughter. And then I go, okay, well, great. You know what? If they're dead and you say, okay, well then I want it to go to my brother and sister. And I go, okay, great. What if they're dead too? And it doesn't matter how many people you tell me I'm going to kill them. Everybody loves talking to lawyers and everyone loves talking about death. So people love talking to me.   Because I, I try to joke with clients and make it light. Cause it's a hard topic. A lot of times, you know, if there's a, everybody that you can name, I'm going to stick them on an airplane or some terrible accident. Cause these things happen. Right. And not super uncommon. I like to use the example of, do you ever go to dinner and do you drive in the same car? And if the answer is yes, then you need a second person or you need to be okay with it going, you know, if I'm off. So if you have nothing in place, the law has something is simple. And if you put together a will, so in a little can be as simple as you can write out, depending on your state, you can write out before you get on the airplane and you sign and date where you want things to go, or you can pay $10,000 to the best attorney in the world and have a 50 page will. And it's still going perfect in that case to go back to my example of, well, I want my daughter to get it at 25 or if she graduates from college, 10% early, she can do that in a little. I can do that through probate, but I have to wait through that year and a half long process.   I'm paying about three to 6% depending if the administrator has an attorney of my estate and what am I gaining? You know, I could've put that same energy and that money into a trust fund given more than my daughter down the road. So it makes total sense. The trust is that I think a gift to the family.   Emil: I agree. Yeah. That's why I decided to do that. And I know Michael, you've done the same. So my next, and probably the last question on this one is, okay, so right now I have all my properties in a trust. Let's say I go out at some point and I start buying properties in an LLC. Do you move the LLC into the trust? How do you get those properties into the trust as well?   Kellie: Yeah. So your, your LLC is going to own the property. And then your trust is going to own the LLC, or you can assign your LLC interests into the task. So in that case, it would take effect. If something happened to you down the road, we're pulling it in to the trust itself. So we're avoiding probate by doing it that way. So if I could draw it out, I would have the trust at the top. Well, really you're at the top. And then I'd have a line down. Then we bought a bubble with your trust, uh, the, a mill trust. And then we've got a line down to a bubble with the mill LLC. And now it shows ownership who has control of what? So it doesn't go the other way. So the LLC doesn't have control over the trust and the trust doesn't have control over you.   You have control over everything. And so for each complete protection, really for you and your family, you have the LLC to protect you. Somebody sees you, they can't go past that first bubble, unless you are buying your diapers every single day out of your LLC, you're breaching the corporate veil. So it stops at the LLC level. And then if something happens and you pass away, then we've got everything in place to protect your family. So you're covering both sides and I joke with clients, but this is the scary truth is that none of us get out alive and in a trust, in a will or nothing or probate, we're all headed in that direction. There's, you know, in this crazy world, everything that's going on, the one thing we all have in common and people don't like to talk about it, people don't like to acknowledge it, but accidents happen and aging happens. And so it's something that if you put it together right now, you can build on it for a lifetime and never have the expense.   Emil: Yep.   Michael: Awesome. I just wanna ask a clarifying question. When a meal says that he owns the trust, owns his property. What's the name on the title? Is it a meals trust or is it Emil as a person?   Kellie: When, and your trust owns the property? So when I bought my house, I had Ellie Chrisman. I was married. So Kellie Chrisman and married woman as joint tenants with the husband. Now, when we put our trust together, which as any good attorney does, I want you to talk with me before I close and to put together, I then transferred. Once we closed into Kellie Chrisman as trustee of the Chrisman family trust, those are the goals of the words that place it into the trust. So when you want something to be owned by the trust, when there's a title document to it, what we do to accomplish that is that you own it. You, the individual as trustee of your trust.   Michael: Okay? Yeah. So if I already own five rental properties and I want to see in my own personal name, and I want to now put them into a trust, we're going to have to change the title of those five properties.   Kellie: Yep. That could be a whole podcast in itself is if I want to try and do this on my own, where am I most likely to mess up? Titling is number one. So you created a trust or you kind of attorney create it for you. That's half the battle. Now we need to fund it. So now we need to make sure your title to your properties and anything that can be retitled is federal correct. So we're transferring it from you as an individual to us trustee and the deed has to be done correctly. It has to be recorded and usually that's included. And so a lot of times you'll see, Oh, this trust is a hundred dollars and this attorney's 1500, this attorney's 5,000. What's the difference. And it's what they're including for you within the trust package. So the funding should, in my opinion, always be included in done for you. I mean, that's the last thing you want to do is spend the time to go through all of this legal stuff and then have a ton of homework to do, including a legally complex thing like titling.   Michael: Okay. So Kelly. So just so I understand. So if I've got those five properties in an LLC and I want assign, you know, put all those into the trust as well, I don't have to change the title on those five properties. I can simply assign the interest of the LLC to the trust. Is that right?   Kellie: Yeah. You don't want to change the title. So if you move it out of the LLC, the issue then becomes that. Now you don't have that protection. It's no longer owned by the LLC. So you want the trust to own the LLC. And whether you do that by assigning it, or, I mean, so I always have a good veteran best, right? So good is listed as an asset. It's find your schedule of assets of your trust. Better is you assign the LLC to the trust itself. And that is the workable solution for most of my clients. Best is within the LLC paperwork itself, the setup of the entity, you have the trust. So you as trustee of your family, trust, owning the LLC interest itself, and that will get the LLC and therefore, anything else you own. So those five properties into your trust,   Michael: Man, we could go on with this stuff for like probably days, but we're getting along. And the two that I want to be very conscientious of your time. I think the last question that I want to ask, and then I'll give them a chance to ask is, you know, where do you see new investors getting into trouble legally?   Kellie: Yeah. So saving the penny. And I hate to say that that seems like such a lawyer answer to, Oh, hire me, but it's not just that. I mean, obviously that's ultimately how I make my money, but, but the reason I did this area of law is that I feel like the law gets in people's way so often. And it prevents somebody that has a great idea or a great investment portfolio from protecting themselves correctly. And then people either say, I'm just not going to worry about it. I'm just going to jump over this hurdle of law. I don't have time to deal with it or they try and do it themselves and it makes it worse or they skimp on what ends up being the most important thing and putting everything else on the line. So if you're setting up a investment strategy and you're going to buy hopefully hundreds of thousands of dollars in property and be making significant income, why not invest in an attorney's time?   And it doesn't have to be a lot of attorneys will offer a free consultation and the right attorney is going to work with you to make it affordable. And it's the best investment, the best foundation you can do. And I think the thing that saves people the most money over time, you will end up spending more fixing it, but then you will just doing it, right. I mean, UCLA Bruin. And I like to quote John Wooden as we all do. And then he said, if you don't have time to do it right the first time, when are you going to have time to do it over? And that's something that I always try to put into my own personal, my personal life and my practice. But I think a good attorney is going to work with you. They're going to make sure that you're comfortable. They're going to make sure that you're not surprised. And that's the goal is to make sure that you're empowered to do what you can do, what you can do, right. And then hire when you need to.   Michael: Awesome love that.   Emil: I don't know if it's a question, more of a clarification. I know we didn't get to one thing I think people should think about as they're considering personal LLC, all those things. If you're going out to get financing, it's a little bit different with an LLC. Most of the 30 year fixed rate, Fannie Freddie government backed mortgages. Those aren't available. If you take the property in an LLC, C I'll usually have to go to a different type of lender, commercial lender, different type of product, but just something else I think is important to consider as you're evaluating all this and navigating it.   Kellie: I found with clients that I've worked with in the past. So having an attorney that's read through your stuff, or, you know, if I have a client that I'm helping, I can work with the lender, my dad's a small business lender. So I kind of heard that my whole life in my ear. And so I will work with lenders to do whatever we need to do. And sometimes it's, you know, you're going to take the property in the mortgage in your own name, and we're going to let the lender know, Hey, we're transferring it into an LLC. And they're going to give us a letter that that's okay, or they're going to tell us their procedure, or they might want something else from me. So they might just say, Hey Kellie, can you give us, you know, a letter on your letterhead with your signature that says, you know, they have an entity, here's all the information. It's kind of their way to be past liability to me. But also sometimes it's ridiculous as it is just having the, the Esquire, the attorney at law, after my name, I can write the things you need to do and note that it more weight, but it's just that extra team player in your pocket so that you have all the tools that you need [inaudible]   Michael: Yeah. Great. Awesome. So Kellie, this has been so awesome. Thank you. So, so, so much if people have additional questions, want to form a trust, need help with an LLC, how legal type questions what's the best way.   Kellie: So email's always great. Or, you know, check out my website Avvo is a nationwide attorney referral website. It's kind of like a Yelp for attorneys, how exciting!  But taylorchrismanlaw.com. Um, and then my email is just my name. I tried to make it easy. Kellie, K E L L I E @ taylorchrismanlaw.com . And I always liked to have a conversation. I always tell clients, don't be afraid that I'm going to charge you. I'll tell you before I charge you. I never want to surprise clients with a bill. That's my worst case scenario.   Emil: Yeah. I can attest to that   Kellie: I'll talk to you about the weather. Kellie. How much are we paying you for this? And maybe it's because I'm a little selfish and I like to know my clients, but you know, always happy to have a conversation and then no, somebody doesn't go with me or they go with legal zoom or they do it. I'm always happy to look at what they've got. And I mean, to me, the biggest compliment is down the road. If they refer me to somebody else, you know, that's huge. And so whatever I can do to help, I'm more than happy to be there. And I'll tell you if I charge you and if I don't do it, I'm going to send you to somebody. I'm not just going to say, Oh, sorry, good luck. I'm going to try and find you that person that can help you wherever you are.   Michael: Great. And can you just spell your last name? So everybody ensures they have the proper spelling   Kellie: It's like a Chris and a man stuck together. So it's C H R I S M A N.   Michael: Kellie. Thank you so much for sharing your contact information. You're a California attorney. We've got listeners all over the country and I think a lot of international as well. Can those folks reach out to you if they don't live in California for help with their legal type stuff?   Kellie: Yeah. So my restriction is, you know, I know California law the best, and if I'm ever uncomfortable, I'm going to send you or refer you to somebody in your own state. But I regularly handle stuff for clients that either live in California and are investing in property, out of state for clients that live out of state or investing in property in another state. And then I'm helping them through the legal process. So I can draft deeds, you know, all over the country in a trust. You're just going to pick California law. And in this area of law, it's not really that dissimilar from state to state. And so it's something I can help people with and have a conversation. And if it's ever something I can't do it's I refer you out and I'll let you know that I can handle whatever it may be.   Michael: Fantastic. And before we let you go, what is your favorite kind of pizza?   Kellie: So pepperoni, jalapeno. And now I want pizza.   Michael: I've never heard of that combo, but I like it.   Kellie: Aye. That's what Adam and I used to order   Michael: Pepperoni and jalapeno. I've got a quick follow up for the group. A question for the group. How do we feel about pineapple on the pizza?   Kellie: No, that's a strong no.   Emil: So a little bit of a long winded answer. I used to work at my first job in high school was Domino's. I worked at Domino's   Michael: Awesome.   Emil: Both making pizza and delivering. So I have tried every single type of pizza. You could imagine, like triple Decker, pizza and Kelly. You just reminded me how good pepperoni jalapeno is. I haven't had that since I, I worked at Domino's in high school and it's incredible. I'm gonna have to get that next time. I order some pizza. I do not like pineapple anymore. I think I got pineapples out at Domino's back in. That might happen.   Michael: I'm a strong pineapple advocate. I just like the sweet and the salty together. Pierre, what's your take pineapple on pizza, yea or nea?   Pierre: I'm just not into pizza.   Michael: I don't like pineapple and I don't like pizza.   Emil: Pierre's too shredded for, for pizza.   Pierre: No it's one of those things where I never crave it, but I'll enjoy it when it's there, but I will always make a choice over pizza if it's me choosing, but I don't see what the big rage against pineapple is either though. I'm…   Michael: Kellie's face is make a barf.   Kellie: It's not supposed to be hot. It's just not.   Pierre: But barbecued pineapple is pretty darn good. I got to say, got to say, but I agree jalapenos on everything. I eat a jalapeno a day. Every single day. I have a fresh one,   Michael: Keeps the doctor away.   Pierre: I don't know. Yeah. I mean probably.   Michael: Awesome. Kellie, thank you so much for coming on and we will have to have you back at some point down the road because there is just so much good meat here to dig into. Emil any final thoughts before we let Kellie out of here?   Emil: No, thank you so much, Kellie. I know you've always been very helpful for me with all the legal questions I send you. So thank you on a personal level. And thanks for coming on the podcast.   Kellie: I can always tell when I'm in the right area. Cause I'm exciting.   Michael: Awesome. Well, Kellie, I'm sure we'll be chatting soon, but until then have yourself a great one stay safe. Alright.   Kellie: Thanks guys.   Michael: Well, everyone, that was our episode. A massive, massive, massive thank you to Kellie. As we mentioned, the sheer number of time we could go on for hours, days, maybe even years about this stuff. I think that's why law school is so long, but we would absolutely love to have Kellie back another episode. Hopefully everybody got a little bit of value out of this and realize just how complicated things can get and how quickly. So I've always touted it. I think Emil would agree. Go get legal advice, go get tax professional advice. Don't try to do this stuff yourself. Just like you're taking your car to the mechanic. They're professionals. Let the professionals handle it. Feel free, if you'd like the episode, to give us a rating and review wherever you listen to your podcasts, go ahead and subscribe. If you want to get automatic downloads on the episodes that come out twice a week. Thanks again for listening. We'll see you on the next one. Happy investing.   Emil: Happy investing.  

The Remote Real Estate Investor
Help! People Think I'm Crazy for Investing in Real Estate… What Should I Tell Them?

The Remote Real Estate Investor

Play Episode Listen Later Jul 7, 2020 39:23


In this episode, Micheal, Tom and Emil take on some common worries that friends and family have when you tell them that you are considering taking up remote real estate investing and provide solid arguments for reasoned responses.  --- Transcript   Michael: Hey, everyone. Welcome to another episode of their motor real estate investor. I'm Michael album, and today as usual, I'm joined by Tom Schneider and Emil Shour. In today's episode, we're going to be talking about kind of an interesting topic. Do those around you, not support your remote real estate investing dreams. We're going to be giving everyone today some tips, tricks, and fodder about how to speak intelligently about remote real estate investing. So let's jump into it.   Theme Song   Michael: Alright guys, before we get into this episode, I just wanted to check in with you all, how are you guys doing? There's some new quarantine issues that just came out from the governor and wanted to check in how you guys are doing.   Emil: Welp. Can't go surfing this weekend because LA beaches are locked down.   Michael: Oh no!   Emil: So that's unfortunate, but I got out there this morning in anticipation of not being able to,   Michael: How was it ?   Emil: It was crowded a little bit slow, but it was fun. You know? It's good. Anytime you start the day out on the water.   Michael: Yeah, absolutely.   Tom: Is a bad day on the surf. Better than a good day, not on the surf guys.   Michael: Yes!   Emil: Of course. Michael would say yes, because he's the eternal optimist, I would say. Yes. There's times. I get really frustrated. Sometimes I get out of the water and I'm like, damn it. And I'm just like huffing and puffing on my way to my car and just like, but yes, in hindsight, it's always like, at least I got out on the water and did something fun   Michael: Without being too cliche. I think every time I get into the water, I'm able to think about stuff and I go in with problems and come up with solutions. Even if it's not a great day, it's way more fun. If it is a great day, given the choice between the two, I would absolutely choose better day, but I don't think I've ever had a bad day out in the water   Emil: Hashtag no bad days.   Michael: That's right.   Tom: What I've been doing lately is our community pool… I live in this neighborhood that used to be part of an HOA and there are still some of the HOA amenities, but now it's just like people have the option to join. And I joined cause it's like a really cool feature, but they have really, they need a monitor at the pool just to make sure that people are not bringing in guests and they limit the number of people and a bunch of other County related restrictions. But anyways, so I've been doing that and I've been working from down there. There's really good wifi. I'm out in the sunshine. I've been having some of my meetings with my background, with Emil, Michael and Pierre, where there's like, you know, a pool in the background and every, you know, couple of hours instead of going on a walk, I'll do a Cannonball and a that's the latest little update. And it's been a really, I don't know, I think there's something about being outside and being creative and that feeds into that. So that's been my, my new thing work from pool.   Michael: I'm curious to know what the HOA, you know, if they just everyone mutinied like, no more HOA!   Tom: Right. I think it fell apart. I think in like the seventies or eighties, I gotta, I gotta get to the bottom of it, but uh, yeah, really just random, big pool. Um, I don't know. Yeah. It's cool.   Michael: Killer. That's awesome.   Emil: How about you, Michael? What's new in your world?   Michael: Um, not a whole lot. I've been staying up quarantining at the in-laws and just kind of hanging out in here. It's been hot as ever like the surface of the sun. They lived just outside Sacramento, so it gets really, really hot up here, but we've been playing a lot of tennis, which has been really nice, cause there's nobody on the tennis courts. Cause it's so hot. And I think people drive by and like what a bunch of schmucks, like who's playing tennis, it's a hundred degrees outside. So it's, it's been a lot of fun to just get out and sweat and be outside.   Emil: Nice man.   Tom: Pierre with so many hobbies. I'd love to hear. I think you might mentioned getting in some woodworking again.   Pierre: Yeah. Yeah. I moved into a new place in Alameda and needed some furniture to fit my record collection in this little nook that we have. So I built like a little mid century modern table with some cubbies, for my records and a rack to hang my guitars.   Tom: That's a fantastic quarantine hobby and practical!   Emil: I give up, Pierre's just the coolest out of all of us. Let's just,   Michael: Oh, it's not even, yeah, it's not even close.   Pierre: Now. I got the edge though. I want to build all my furniture. We were looking at buying some online but now it's not seeming as attractive.   Michael: You can build a better.   Tom: I love it.   Emil: Awesome. And for anyone who's new to the show, wondering who that voice was. That is our producer Pierre.     Michael: All right, guys. So I want to break down some of the very common aversions to remote real estate investing and then talk through some of the counterpoints to each of those. I think any real estate investor at some point in their investing career has likely come up against some aversion or caught some flack. So I want to talk about the first one that I think might be one of the most common ones. And that is how could I possibly ever invest in real estate remotely? I don't know anybody in inter X market here. Tom, do you want to take a shot at this one? And then, you know how you would respond to someone who's throwing this at you?   Tom: Yeah, totally. And what a relevant first topic for the remote real estate investor. So I think a common misconception about real estate investing is that it, you are a lone wolf in and out doing on your own. And that is so far from the truth, especially, uh, as a remote investor. So what I would say for this is you should invest as a lot of time in building your team just because you are not in the region, you're specifically your local property manager. That's really going to be a key key point of being able to do this remotely. So a way to, you know, go about that is have a very thorough vetting process of identifying, sourcing and vetting your local property manager. And one of the great things that Roofstock does is when we open a market, what we'll do is we'll find from word of mouth and looking it up online, the top 20 local property managers. And from there we'll do phone interviews. And from there, we'll cut more down to where we have about five of them. And then we'll go into the office and visit them, get their standard operating procedures, get their, a copy of their lease that they use, get all of these different and then say, okay, yup. These are good guys that we would recommend. Now me as an investor, if there's a company that's doing that, that's great. That gives me a head start, but I will still take the time to vet them myself. One of the aspects we have within Roofstock Academy is some pretty thorough interview templates for talking to property managers and identifying good ones. But to combat that is you have a really thorough process of building your team local there on the ground. So, you know, once you have identified that property manager that is going to be your remote eyes and ears is really not that different than doing any kind of local investing. Once you have that trusting partner   Michael: And Tom breaking down that big rock into an even smaller bite sized rock, how do you go about finding these people? If you're not investing through Roofstock and they are not doing it for you, what's the actionable step that people can go take to go meet or start talking to these folks.   Tom: I always put an extra points on referral from people that I trust and know. So I'd say if you can get referrals that way from either lenders or other investors, you know, that's a great place to start, but you should expect what you inspect. So you need to go in and expect it in, inspect it to now that is a mouthful.   Michael: That's a tough one to say.   Tom: Yeah, yeah. We use that saying a bunch of our, the last company that I worked at, but the gist is if you don't do the work to verify, you should expect that it's not going to be that awesome. So you need to put in a little bit of the work of talking to these partners. So I digress a little, I guess let's see. I'm going back to your question. What was your question?   Michael: It was how can someone go find these people?   Tom: How can they find people? So, okay. References number one, number two, don't shy away from looking on the internet of just searching the city of who are the major property managers. And you know, this, isn't making the decision on who you're picking. This is just building that initial list to widdle down with conversations on the phone and potentially in house visits to make sure that it's all buttoned up and such. But I'd say again, your greatest resource would be getting referrals. Bigger pockets, I think on their forums have some references of some potential local property managers, but I would definitely expect what you inspect. So make a point of doing that. Like work.   Emil: One of the thing, I want to point out with this one, cause I remember getting this one a lot. When I first started investing, you know, people would be like, you're going to invest where across the country, like that's insane. What if something happens to the property? What if it gets vandalized? What if this and that? And the thing is, is those things happen, whether you're local or you're investing remotely, right? It's not like if you live 15 minutes away from the property, things aren't going to happen. Things are still going to come up no matter where you invest again, it's just making sure you have a partner. And that's why we keep talking about this property manager. Who's invested, who cares and who is a good member of your team. That's one of the big things we're going to be talking about is, you know, you hear a lot of real estate investors say you have to build a team. This is a team thing, especially if you're investing remotely. So that's the big thing is things will still happen. It's just a matter of getting the right partners to help you handle all these things.   Michael: You guys nailed it. I have nothing to add. The one thing I would add is that it really forces you, which I see it as a pro. Some people might see it as a con, but it forces you to get really good at time management. Because then they'll just like you said, stuff's going to happen. Whether it's next door or whether it's across the country. So if it's across the country, you've got to rely on people to take care of that. You've got to have set the systems up and placed on, like you were saying, to be able to have that dealt with without you needing to become involved. So if it's next door, you're going to be tempted to go fix it yourself or go deal with it yourself. But if it's across country, you physically can't. So being really good at time management and task delegation is I see it as a big pro.   Tom: I guess one last thing I'll say is, you know, ideally the home that you own and you're renting out is close to you, but there are so many benefits to investing remotely. Like you have access to so many more properties, so many different types of returns, such different like economies, like that makes it a little bit of barrier to entry is doing that extra homework of finding that great partner. So for me, being able to access these cash, flowing properties all over the US that extra work of finding the good property manager and then vetting them and building that relationship is worth it.   Michael: Yeah. And to that point, I mean, what's the alternative here, not investing or not investing remotely. And if you're in a really expensive market, you might not ever be able to break through. So if it's invest remotely and learn a bunch of stuff or not, I'd say you can't afford to not learn how to do some of this stuff.   Tom: Word.   Michael: Okay. So let's move on to the next one. Uh, so many times I hear people say this, I know someone who tried to investing in real estate and they would take these midnight calls, fixed toilets. I don't want to do that. Why would you ever want to do that? Emil, you wanna run with this one?   Emil: Yes. So this is another common one, right? So people say, okay, I get why you want to invest remotely, but are you going to handle fixes? What if someone calls you? And again, this goes back to what we were just talking about. It's this is why you hire third party, property manager, again, building the team, right? I would say the property manager is one of the most important pieces of your team. And the thing here is I don't know how to fix most problems, right? I would call a handyman or whatever anyway. Right? So the property manager is just, they're just your barrier. They're taking in those calls and they're finding a local specialist. Again, you're not going to be good at everything in your business. What you want to do is hire the professionals who are in the property. Management is the best that operating your property.  I would probably do a much worse job and I'd spend way more time than a property manager who does this for a living. So the rebuttal to that question is while I'm going to hire a third party property manager, who's an expert in the area. Who's going to manage it for me. And in return, they take a certain percentage of my rent each month. The other thing is the important thing here is this frees up a lot of your time, right? If you're constantly dealing with your operational stuff, you're not going to be thinking about how can I grow this? How can I scale it? A lot of us who are doing this, we have full time jobs, right? Like instead of fixing things on the weekend, I could be thinking about how can I start a side gig, earn more money or whatever. So I can go buy more properties, which I would argue is more important than handling the day to day stuff.   Michael: It's so interesting. I think people in the day to day world in life can really wrap their head around hiring professionals to do things, right. Nobody says, I'm not going to go buy a car because I don't know how to fix it. No, we all take it to the mechanic. I think it's the same thing with real estate and with investing where people are. So whatever reason can't get their head around that you might not have to do that, that kind of stuff. There are professionals that will take care of it for you.   Tom: Right. It's such a great point. I, I love that, your, uh, isms, Michael isms. I think we'll say, I think in talking to a lot of people who are interested in investing in real estate locally, they're like, yeah, then I can go and I can run out and paint the house when, or do these things that happened. It's like, no, you don't have to do that. And you know, we were talking about these costs that you incur with either repairs or maintenance or paying your property manager, but those are good costs to pay. And also at the end of the day, it's going to help you on your tax basis. It, you know, there's just so many tailwinds in doing this.   Emil: One last thing I want to add here is you can always later down the road, maybe you're ready to retire, right? Maybe you have X amount of properties. You have enough cashflow coming in. You want to retire. Maybe at that point, you feel confident enough where you do want to self manage. If you go back to episode five that we did with Chris Bennett, he talks about how he self his properties from thousands of miles away. I personally probably won't get to that point. I'd rather let somebody else deal with it. But it's always one of those things where I think you can even just observe your property manager for years, learn how they kind of run everything. And then if you want to down the road, you can switch back or switch to self managing. If that's interesting to you.   Michael: Funny, I think the longer I invest, the less I want new self-manage. I realize how much goes into like yeah, no way.   Emil: Yeah, same. I had somebody who I was talking about. Who's looking to buy a property on Roofstock and they were asking me the same thing. It's like, should I self man? He's like, I'm actually thinking about self managing first, just to like, get an idea of how all these things work and then handing it over a property manager. And I was like, if anything, I would do the complete reverse for all the reasons I just mentioned. Like, dude, you're brand new. Don't don't do it. It's going to be a nightmare. And you're never going to want to invest in another property again. Promise   Tom: That's the Emil Shour guarantee.   Michael: Awesome. Okay. So the next one I want to touch on is something I'm sure we've all heard a lot about, and it's that real estate is such a risky investment. Look at what happened in 2008. And so I'll take this one. If you guys don't mind, you know, my response is you're spot on don't invest. No, just kidding. I would say, you know, 2008 was the direct result of poor lending practices and those have definitely since changed. And so I don't anticipate seeing a financial disaster as a direct result of poor lending practices again. Don't misinterpret that as me having a crystal ball, that's just my personal opinion and be very may well see a financial disaster from other, but the poor lending practices seems to have gotten cinched up pretty tight. So I would actually argue that real estate is often a safer investment than the stock or the bond market.  And I think so often people say, okay, real estate is risky, but these other things aren't, there is also people that say real estate is risky, put your money in the bank. And to that, there's all kinds of counter arguments and counterpoints that are all based in fact about inflation and how you actually lose money. If it's just sitting in the bank, if you're not earning at least the inflation return, but so in looking at growth, the comparison to simply stocks, bonds, and real estate. So with real estate, there's just such a higher degree of control. The tax benefits and potential returns are typically going to be better than your average year in the stock market. I think it's pretty well accepted that stock market returns average between six to 8% in any given year real estate, you can do significantly better with that from a pure cash on cash return perspective that doesn't even account for the tax benefits associated with it, as well as the appreciation and loan pay-down equity that you're essentially buying into your property. So I personally I'm drinking the Koolaid. I think there are tons and tons and tons of facts and figures that you can throw at someone that's saying, Oh, it's such a risky investment. My guess is that they probably haven't invested in real estate. And if they have, they aren't looking to do the same type of thing you're doing remote investing with a property manager. So I just want to make sure that everyone's comparing apples to apples. Whenever they're hit with something like this, you really want to understand what's being talked about.   Tom: That's great and a good overview of like all the benefits of why, at least in our opinion, like the benefits outweigh the rewards. And what I love about drinking the Koolaid is there's so many different flavors of the Koolaid. So I kind of switch off on which one I'm most excited about. So the tax advantages is great. The immediate cashflow is great. The appreciation is incredible, but the Koolaid I've been sipping a little bit more of is the loan pay-down aspect. And it's just crazy. You can borrow like a hundred thousand dollars and someone else will pay it off for you. Like, I don't know, like wording it that way is really kind of mind boggling of how incredible investing is. So even if you're not cash flowing, say your cashflow is zero, but you still have a loan on the property. And you're not paying that loan. The person who was renting the property has paint alone. It's like obscene right property after you get a free property. So anyways, just kind of in your, going through your ran, I was just thinking of what is currently spinning through my mind a little bit heavier on like, wow, it's unbelievable. How much of an opportunity is. So anyways,   Michael: I thought you were gonna say that you're really excited about sour green, Apple Kool-Aid flavor.   Tom: That might be the loan pay-down is the sour green Apple.   Emil: Oh man. Kool-Aid when you're a kid and   Michael: The best, the best. How do you guys feel about Hawaiian punch?   Tom: I think American tastes have gotten a little bit less sweeter. At least I could rant on this for a little bit, but I'll finish it. There's been a shift in American culture kind of going to more subtle. Like if you look at like Hintwater LaCroix, if you compare like the drinks that are consumed today, versus the drinks that were consumed like 10 years ago, it's like hummingbird water back then. So I think I have a feeling if you had some Hawaiian punch, like you would be like, what the heck is, this is this like, meant for like a hive of, of hummingbirds, like anyways,   Michael: And it's that bright red too!   Tom: But the great thing about Koolaid is you don't have to put all the powder in. You can make it culturally adjustable by just putting a little bit of it in and boom, welcome to 2020, just 10% of it and have it. All right, go ahead.   Emil: I don't know how I can follow that up with something serious, but just to finish this section, I remember we had this blog post on the Roofstock blog talking about how did single family rental returns compared to stocks and bonds. And the Roofstock team did a little study. It was from 1992 to 2017. So a 25 year period. And if we found that single family rental returns were nearly identical to stock returns and the outperformed bonds with far less volatility. So that was one other thing I wanted to highlight here as well. Plus all the other benefits, like we talk about like tax advantages and all that, which I don't think was factored into this study.   Tom: I'm almost sure it wasn't.   Michael: Yeah, that makes sense. Because everyone's going to have a different tax basis.   Emil: Yeah. This was just looking at returns.   Michael: Okay, cool. So one of the last ones I want to touch on which we can all kind of tag team, but I kind of want to give it to Tom to give him a runway to rant. But so many people I've heard say owning real estate makes you a greedy landlord getting rich off the backs of other people. Tom, what would you say to all those people?   Tom: I think that people need safe housing, people need housing, and this is just kind of part of the wheel of providing that. So like I think above all, and we've talked about this before an earlier episode, like at the end of the day, it's about like habitable safe places for people to live. And I think as an owner, that's like a key part of the responsibility, so sure. Their incomes earned. It's like a little business that you own with every single one of the houses. But at the end of the day, like at this, we're talking about people's where they live and being able to provide that is valuable.   Emil: I think anyone who kind of believes this, I think you should a hundred percent become an owner because then you'll have a better idea of both sides of the coin. Right. You'll have owned, you'll have rented, I've rented, I've owned. I think having been in that spot right where you're a renter and you know, you've dealt with a landlord. I think it makes you more empathetic to your tenants. Like I want to provide a safe habitable unit, like Tom mentioned for those reasons. Like, if you're, if you're a good person, you care about other people, it's not like you're going to become an owner and all of a sudden just be like terrible person not providing for them. So I actually just, if you believe that, I think you should become an owner and just have experienced on both sides personally.   Pierre: As a renter, I have to say that it's way better to have a cool landlord.   Michael: Yeah. It's way better renting experience to have a cool landlord. Someone that's a real person as opposed to just a machine.   Tom: Yeah. And I don't, it has to be so black and white at that. Like you're only trying to maximize your return at every single look. I think there's a lot of places where that makes sense, but there's this humanity aspect. So one of my tenants, you know, started just recently had some issues around payment on like an employment and stuff. And you know, I talked to the, reached out to the property manager and said, Hey, you know, is this, is this something, you know, that has to do with the virus or they cause I'm very open to helping them out. Like if we need to make some adjustments or some concessions, you know, as an owner in real estate, you don't have to put on the monopoly outfit and just, you know, drill people into the ground, like, like half a conscious, like this is a good business to build wealth, but it's multidimensional, right? Because you're owning a place where somebody's living at. I think that's a really important aspect to have some humanity as an investor. So it's not, you have to go down this one path, right. You can do business consciously.   Michael: Yeah. And to anybody out there that thinks this or anybody out there that you know, is, is catching this type of comment from other people, I'd say, look, you need to understand what actually goes into real estate investing and real estate investors pay tons of money every single year to local school districts in the form of property taxes. So I'm not sure how that makes them greedy, but I would also follow that up with asking them how much money they contribute every year to their local school districts and see what they say. So there's so much money that gets poured into the local economy via real estate investors. And that comes in the form of real estate taxes, property management fees, paying local vendors for goods and services. So, so many investors spend a ton of money on these properties and local neighborhoods that actually are making them more attractive and welcoming, which can often lead to safer communities. So it's so easy for someone to just see one side of the coin and say, Oh, you you're collecting rents. You're making money off this person. Well, yeah, but also there's the other side where I'm contributing to society, paying taxes and making the schools better. So if you want me to stop doing that, that's a different conversation, but you really have to understand both sides of that coin to have an intelligible conversation about it.   Emil: Bravo, sir, drop the mic, please.   Michael: Mic drop it and walk away from that person. And just kind of in this same vein, I would also encourage anyone who comes up against any kind of resistance to really try to have a discussion with that other person about why they feel the way that they do. And try to understand why what they're talking about may or may not be applicable to your personal situation. Because I think real estate investing is this huge, huge topic. On the podcast, we talk about the remote real estate investing, which is one kind of niche of that, but there's so many other different topics and variances on real estate investing. So a lot of people here real estate investments like, ah, they're evil, they're the worst people in the world. Well, okay. Yeah. There might be some that are evil. It might be some of the worst people in the world, but you don't know me necessarily. And so let's try to understand what you're talking about and what I'm talking about. Cause so often they're not all the same thing.   Emil: I like that well said.   Michael: So just curious. I mean, have you guys ever run into any type of these comments? Have you gotten any flack for, you know, doing something that's maybe perceived as different from what your peers or others were doing? Emil: Yeah, definitely. I mean, I've mentioned on other episodes. My dad is a real estate investor here locally in Los Angeles and he thinks, you know, I'm kind of crazy. It's still, uh, when I was first starting, especially like what you're gonna buy property, where again, and it's common for people to feel that way because traditionally, everyone felt like, you know, my dad's whole thing is like, if I can't see it, touch it, feel it, there is no way. And that's fine. I think for some people, it just doesn't work mentally as just a blocker. But like Michael said, I think it's about being open to different things. And again, if the option is, do nothing or invest somewhere else to me, I'm not going to let that stop me personally.   Tom: Yeah. I think so many people have preconceived notion of what it means to be a real estate investors. And they have this idea of them running out with a hammer and taking the call and it's like, no, it's different than that. It's way more passive. It is way more team-driven, which has kind of been a theme of this episode. So throw away or assumptions on what it looks like and, and come to Roofstock Academy. No, but throw away your assumptions on what it looks like and look at some of these different strategies that we're talking about. If you're looking to do it in a more passive way and not throwing so much of your time of trying to make it work. The other comment that I've heard from some friends is, and this goes again, I think the greedy landlord piece is, you know, someone teasing, I was talking about real estate investment, like, Oh yeah. Always money and being a slum-lord. I'm like, you know, get outta here. Like I think, as I said, like there's a wellbeing aspect and like having these safe habitable places and working with your property manager to make sure that's part of your brand at the properties that you have, you know, it's, it's not about cutting corners and like maximizing every dollar. There's so much more to that.   Michael: Yeah. I totally agree.   Tom: And several of my friends have now invested, so I, uh, won the day. So go ahead.   Emil: And that was the point I was just about to make is I think when you network with other remote real estate investors and you realize there is an ecosystem of us doing it, it makes you feel a lot more confident. So if you don't know anyone else who's doing it, I highly recommend getting in touch with somebody network with them, talk, join groups, join, whatever. Just say, like build that network. I think it's, it's invaluable to have people around you who are doing things similar to you.   Michael: Yeah, absolutely. You know, when I first started investing, like you both, I caught so much of that flak of you're going where to invest, you know, why, what, that's stupid, you're there. You're crazy. And I'm like, yeah, well it makes sense to me. So, and now most of those friends I haven't since invested to, Oh, they see what's going on here. But yeah, so much of it too was I felt like this lone wolf, I didn't know there was a community out there. I didn't know the other people doing this. I just heard, yeah. People invest in real estate, but I didn't happen to know very many of them to ask them, you know, am I crazy? Is this insane? But now I realize no I'm laughing all the way to the bank. All right guys, any final thoughts on this stuff?   Pierre: I have a question in this vein of remote versus local investing. When would it make more investment sense to invest in your local market as opposed to remotely, if you live in an expensive area?   Michael: Super good question. I'll let you guys take it first.   Tom: I'll take the first stab at it. So excellent question Pierre of, when does it make sense to invest locally versus is remote. And I think it all has to start at what is your investment thesis? Like? What is your end game map? If I live in an area where I don't necessarily need the cashflow right now, and I'm pretty bullish on appreciation, I live in Northern California where properties are a little more expensive. Maybe it does make sense to invest in a property out here locally. If I'm looking for a property where there's a little bit more of a blend of appreciation and a bit more immediate cashflow, then maybe it would make sense to invest remotely. And to kind of get us to rephrase a little bit is, you know, what kind of returns are you looking for? Like if I had to make this analogous and that's right to like the stock market, like, am I investing in a growth company or am I investing in a new startup, but am I setting a value investing? Like what kind of strategy? And I think that will answer the question on where you're doing your investing at.   Emil: The only other thing I would add there is I think comes down to your comfort level. If you just can't for whatever reason, get yourself to invest remotely. I don't think you should just not invest. I think if you can invest locally, go for it, right. If you just can't get over the remote factor and you know, like you could be making better returns elsewhere. The thing is, is there's people investing locally doing insanely well and there's people investing remotely doing insanely well, I don't think this is a, you have to go local. You have to go remote. I think it's just by your comfort level, how much money you have to invest, you know, just your strategy and that your thesis, like Tom mentioned   Tom: Price point, great point. And also the volume of homes available. I mean, you're limited just in your own backyard of how many homes are for sale. Go ahead, Michael. I see you.   Michael: Yeah. I see you too buddy.   Tom: The light in me sees the light in you!   Pierre: Namaste!   Tom: Namaste   Michael: You know, from avatar, we need to hook up our ponytails.   Tom: Yeah. I'm touching the microphone.   Michael: So the last, I think those are both really great points. The last thing I want to add too it, is what the goal is and what are you trying to accomplish? But one thing I don't think that it has mentioned is the idea of house hacking, which is kind of this concept of you buy a house bigger than you need or a place bigger than you need and you live in it and rent out the other room. So you're kind of getting the best of both worlds and a kind of hybrid approach with, I have a place to live now and I'm making some rental income alongside with that. And so if you do that well enough, you could absolutely see similar returns to a traditional investment property at distance, but get the benefit of living in a house locally. And so what I think is really important to look at as the true opportunity cost and true total cost, because if you're investing somewhere else and continuing to rent while there's a cost associated with that, versus if you buy a house hack locally and are living in it, well, there's a different cost associated with that, but you're not paying rent anymore. So look at the whole picture. And I think just like Tom mentioned, you know, look define what your goal is. So I think I ha how's hacking is a really, really great way to get started in real estate investing and kind of get two birds with one stone and then just like Emil said, what the price point is and what your, you know, you're only going to qualify for X amount of dollars in a loan if you're going that route. And so that's going to be a limiting factor as well.   Pierre: What about buying from a family member would buying from a parent, make it more interesting in the way of tax benefits or anything like that?   Tom: I mean, a huge way to get ahead in real estate is any kind of discount to valuation. So like if there's any kind of sweetheart deal with that, I mean, you don't want to take advantage of your parents, but like if they're like open to giving you a little bit of a discount, like, man, that could be an immediate, huge head start because you already have like a little bit of equity in the house where some of the tools that we talked about pulling out equity, like cash out refi or HELOCS or all of that stuff like that can give you an advantage there in just the question of like, let's say you're paying fair market value. It really depends on if that house fits your investment thesis. So looking at the type of returns that you would get, then if it fits that then great. That makes sense. I'd say just kind of like specific to your question around family members. Like if you're able to get a little bit of, maybe it's not sweat equity, it's love equity. That's a huge step up.   Michael: One other thing too, that I've seen here that works really well. Especially if the house is owned free and clear is your family can finance it for you basically be the bank and you pay them a monthly payment as opposed to getting a mortgage. You can just get, you know, you guys decide what the terms are amongst yourselves. And it's so much easier. The one thing that I definitely would encourage people to look out for and I harp on this literally every day in the Academy is property taxes and especially if it's in California, because I asked my attorney once I was like, what if I just sell this house to my wife for a dollar? Because my property tax base is X, what my property tax has dropped to a dollar. And she's like, yeah, no, that's not how it works. If it's, if it's priced way under market, they're going to assess it at the fair market value and tax you on the fair market value. So even if you're getting a discount on the purchase price, that's great. You just want to be aware of what the taxes are going to look like after the fact. And especially with a lot of these family properties, they've been in the family for so long, they were purchased at such a low tax rate. So being aware of the tax rate and what that's going to jump to is really important for sure. It's going to move in California, but you just want to be aware of it. If you're in another state doing this type of deal, just be, you know, find out what that tax rate looks like. But great questions, man.   Tom: I got one more for this. So in the theme of this episode of your friends being able to speak intelligently, when you're, when people try to talk you out of investing in real estate, why aren't you just buying somebody else's property? Isn't there like a reason they're selling it? Why, why, why, why   Michael: Is it trash?   Tom: Isn't it trash if somebody's selling it, it must be a bad deal or something wrong with it. Michael, would you like to lead this one?   Michael: Yeah, it's a super great point and a really great question. I think I hear all the time in the Academy. I mean, it's just goes back to one. Man's trash is another man's treasure, but also you're probably not buying trash. I mean, people sell for any number of reasons. So we'd never know a motivation unless we ask. And so often sellers are selling out of desperation, whether that's, you know, divorce or they need cash for something. So it could be a really great property, could be really great deal. They're just selling it because they need the cash. They could also be selling because they got a nonperforming assets to be performing. And now it's really great. And so we talk about that a lot is adding value. You buy a crummy property, you fix it up. And now it's a really nice property. I mean, that's what turnkey is. Someone is selling a perfectly functioning and performing asset. And so giving people an opportunity to buy it means that they get to make some profit in the middle. So I definitely definitely disagree with that wholeheartedly. I think that people need to understand that there are so many reasons why someone could be selling a property.   Emil: No, the only other one I would add is what we call a tired landlord. So someone who just been doing this for 30, 40 years, they're done right. They've maybe they've been managing it this whole time by themselves. And they're like, I'm just, I've made my money. My market has appreciated. I'm going to do well on the sell. I just want to get out of the business. So they're tired and they just want to move on. That's another one.   Michael: I love how you said that. They're just, they're just exhausted.   Emil: Just, just tired man. I could,   Pierre: Did you have your dad in mind when you're commenting on this?   Emil: My dad is such a, such a tired landlord. He's an exhausted landlord. He is. He is just like, pardon me. Thinks he loves complaining about being a landlord though. It's just like in him that he likes to compete. It gives him a discussion topic.   Tom: Yeah. My comments would be on this is concerns around, you know, why is the sellers have a process and the way that you evaluate the homes that is consistent. So once the property goes through the ringer where you're looking at, you know, condition value, tenant, if they're, it is occupied, all that stuff, you can really make the assessment. If it's a good or a bad deal. And don't overthink seller motivations, just like Michael said, there's going to be any number of reasons within Roofstock there's all kinds of different types of sellers. There are individuals, there are bigger institutions, there are funds and sometimes the funds just expire or sometimes they move, you know, the geographic concentration, they might move to a different market. So I wouldn't overthink it and just do your homework and follow the right steps and doing your evaluation of the property.   Michael: Okay. So now I've got a question for you guys kind of a fun one. And just so all of our listeners know, I didn't tell a meal pier and Tom, what the question was before we started recording this. So they are totally going to be blindsided by this. And it's a, it's a pretty traditional question. It's one that, you know, I think is asked pretty regularly of people, but I put a little bit of a spin kind of unique twist to it. So the question is you're stranded on a desert Island. There's the very typical question that I want to know the answer to of what two items would you sum into your location to help you escape to survive? But also I want to know where's the most ideal setting for said deserted Island,   Emil: Bali, a surf board, because the waves are going to be amazing deserted Island. I'm just, I don't even know if I'd want to leave. Honestly. I'm not trying to get out of there if I'm just stranded in Bali, no one around amazing waves.   Tom: Do you guys watch naked and afraid?   Michael: Yeah. It's so good.   Tom: What would your survivor score be?   Michael: Oh, I would start it probably a six and end at a 7/8. Oh, underdog performing. Sorry. I interrupted. Go ahead.   Emil: Alright, so I'd want to surf board item two…   Tom: Are we picking locations or picking what we're bringing with us? What's the situation?   Michael: Both! Emil: A laptop that has a never ending battery and access to internet.   Michael: No dude, we're not playing this “imagine if the best invention” game.   Emil: You did, you did not give me any rules, constraints. It's up to my imagination. Creativity.   Michael: All right. That's reasonable. And the first thing I would do is use said computer magical computer to get a ticket for my wife and daughter to come join me at the Island.   Tom: So, if you're going down, you're dragging them with you.   Emil: That's right. Tom, what would you, what would you bring and where would you be?   Tom: I think I'd be on the oldest Island of the Hawaiian islands. I'd be in Kauai just because it's, you know, lots of fish around there. I would bring some Kool-Aid from 2000 just cause I know it's diluted. I could just use a little bit. That's going to last me a very long time to match my 20, 20 taste buds. It would last a very long time and yeah, I think I would somehow finagle my wife and son to come join me too with that magic computer that I would borrow from Emil. So there we go. I got Kool-Aid and magic computer.   Michael: All right, Pierre, where are you stranded and what would you bring?   Pierre: Hmm, maybe somewhere in the Mediterranean, like Malta and I would bring a guitar and a hatchet.   Michael: Nice see. Pierre's the real survivor here.   Tom: Which guitar?   Pierre: I'd bring my acoustic. Probably my Taylor. Yeah, my guitar and a hatchet. Cause I forget what the saying is exactly, but it's with a pocket knife, you can survive, but with a hatchet you can live like a king. a nice I'd built some stuff for sure.   Michael: Nice.   Tom: You're already practicing. You're hurting right now. We go to peers does desert Maltin paradise and he's mid century. Nice couches beds built. Starts a popup shop.   Tom: You're turn Michael.   Michael: I would probably go to be in Bermuda because I hear some crazy stuff happens there. I'd be very curious to see what's going on. My two items would probably be a satellite phone so I could order all kinds of great stuff. And if I say anything other than hatchet, I'm looked like a chump. I think I should also bring a hatchet.   Tom: Your survival skill just went down. Your Pierre's survivors went down because you had advanced tools.   Michael: I could have brought a chop saw.   Tom: Yeah. You just went to a 5.5.   Michael: Oh, it's such a ridiculous show. Naked and Afraid. But it's so interesting to see what people bring I'm waiting for the day with two people bring the same thing. Like they both bring a lighter and like, Oh crap. Like we didn't talk about this beforehand.   Michael: Well, that was our show. Everybody. Thank you so much for listening. We hope you enjoyed it. Don't forget to give us a rating or review wherever it is. You listen to your podcasts, subscribe as well. And we look forward to seeing you on the next one.   Tom: Happy investing.   Emil: Happy investing.  

The Axial Spondyloarthritis Podcast
Michael Mallinson - Discusson about Axial Spondyloarthritis

The Axial Spondyloarthritis Podcast

Play Episode Listen Later May 24, 2020 58:19


Jayson: Michael, welcome to this episode of the Ankylosing Spondylitis podcast. And based upon the introduction and what we're going to cover today, I may have to change that name at some point down the road. Welcome to the show. Michael Thank you, Jayson. And thank you for having me. And yes, there's certainly time to change terminology around our disease. Jayson: Well, I was diagnosed 35 years ago, things tend to change slowly. So hopefully, I'll get around to figuring that out and what I want to do and how we structure it, but you know, you and I met through a forum on Facebook that deals with ankylosing spondylitis and the whole disease structure itself. You've made multiple posts that have been met differently with people's reactions on why the correct terminology might not be calling the disease itself ankylosing spondylitis, but maybe better off calling it Axial Spondyloarthritis. Tell me a little bit about that. Michael: Well, I can I understand why people are married to the next Ankylosing Spondylitis because like you that's what I was diagnosed with. And after my disease onset 40 years ago, but times change the technology changes, and also the name Ankylosing Spondylitis was never a universally used name, still isn't. In many parts of Europe, especially German speaking countries, the disease is referred to as Mobis Bechterew. In Russia, for example, it's named after Vladimir Bekhterev who was a Russian doctor who documented some of the symptoms of Ankylosing Spondylitis, but it's also been called Marie-Strumpell disease as well after two researchers who described the disease but what's more important, from our point of view is that Axial Spondyloarthritis is very difficult to diagnose. Originally, it was diagnosed by X ray radio graphically. So back in 1973, people recognized that there was a very common association with the gene HLA-B27 and spondyloarthritis. And looking into that further, they started seeing that people with Axial Spondyloarthritis or then called Ankylosing Spondylitis had this radiographic stage. And that was used as a diagnostic tool. There are no diagnostic criteria for this disease, but there are lots of different classifications. So, if you had radiographic sacral sacral le itis, and you displayed some other spondyloarthritis symptoms like family history or morning stiffness, etc. You were diagnosed with Ankylosing Spondylitis, then MRI came into being in the 1970s By the 1980s it was out there in the general hospital population and in general use and people who could read MRIs started noticing that if they were taking an MRI of the sacroiliac joint, they could see sacroillitis. But was this the same as the sacroillitis evident by X ray in Ankylosing Spondylitis? And there was a long debate about that. And that debate really wasn't resolved until the last year or two. So it's now understood that what we call Axial Spondyloarthritis is a continuum of disease from what had been called non-radiographic axial spondyloarthritis through to radiographic axial spondyloarthritis. So it's all recognized as one disease. And the important thing about that is that to exclude people, from patient organizations from help and support from the treatments available for Ankylosing Spondylitis, because they have non-radiographic axial spondylitis writers is extremely unfair. The disease burden is the same. Somebody with non-radiographic axial spa has exactly the same symptoms, the same pain, the same stiffness, the same mental issues as somebody who they ankylosing spondylitis. There's a further important part and that is that we know from a lot of evidence that the earlier the treatment, the better the outcome for the patient. So if you're waiting 6,7,8,9,10 years for diagnosis, and you don't get onto a treatment plan, until you're sort of seven or eight years into your disease progress. That's pretty serious, because by then you could have disfigurement, you could have kyphosis, you could have fusion, Support this podcast

Aufgschnappt
Aufgschnappt Folge 23 mit Michael Well (Well-Brüder, eh. Biermösl Blosn)

Aufgschnappt

Play Episode Listen Later May 13, 2020 46:43


Schluss mit lustig! Die Kulturwirtschaft ist ausgeknockt - keine Veranstaltungen, keine Einnahmen, keine rosigen Aussichten. Mit Michael Well (Musiker, Well-Brüder, eh. Biermösl Blosn) spreche ich über die prekäre Situation und unseren neuen Agentur-Alltag. Nach den Wohlfühl-Folgen der letzten Wochen machen wir diesmal unserem Ärger Luft. Wir leben für Kultur und leiden unter der aktuellen mangelnden Wertschätzung sehr.

She’s A Talker
Michael Smith: Room Tone

She’s A Talker

Play Episode Listen Later May 1, 2020 25:06


BONUS EPISODE In this bonus live episode, artist Michael Smith talks about how to get creative with bad teaching evaluations. Season 3 coming soon! ABOUT THE GUEST Michael Smith’s recent solo exhibitions and performances include Museo Jumex, Mexico City; Yale Union, Portland, Oregon; Tate Modern, London; and Greene Naftali, New York; and the Institute of Contemporary Art, Philadelphia. His work is in the collections of the Blanton Museum of Art, The University of Texas at Austin; Inhotim Institute, Brumadinho; LWL Museum für Kunst und Kultur, Münster; Migros Museum für Gegenwartskunst, Zürich; Mumok, Vienna; Museion, Bolzano; Paley Center for Media, New York; Centre Georges Pompidou, Paris; and the Walker Art Center, Minneapolis. ABOUT THE HOST Neil Goldberg is an artist in NYC who makes work that The New York Times has described as “tender, moving and sad but also deeply funny.” His work is in the permanent collection of MoMA, he’s a Guggenheim Fellow, and teaches at the Yale School of Art. More information at neilgoldberg.com. ABOUT THE TITLE SHE'S A TALKER was the name of Neil’s first video project. “One night in the early 90s I was combing my roommate’s cat and found myself saying the words ‘She’s a talker.’ I wondered how many other other gay men in NYC might be doing the exact same thing at that very moment. With that, I set out on a project in which I videotaped over 80 gay men in their living room all over NYC, combing their cats and saying ‘She’s a talker.’” A similar spirit of NYC-centric curiosity and absurdity animates the podcast. CREDITS This series is made possible with generous support from Stillpoint Fund.  Producer: Devon Guinn  Creative Consultants: Aaron Dalton, Molly Donahue  Mixer: Andrew Litton  Visuals and Sounds: Joshua Graver  Theme Song: Jeff Hiller  Website: Itai Almor Media: Justine Lee Interns: Alara Degirmenci, Jonathan Jalbert, Jesse Kimotho Thanks: Jennifer Callahan, Nick Rymer, Sue Simon, Maddy Sinnock TRANSCRIPTION NEIL GOLDBERG: Hello, I'm Neil Goldberg, and this is She's A Talker. We recently finished our second season, and we'll be launching Season Three very soon. In the meantime, we thought as a bonus we'd share a live episode that was recorded with artist Mike Smith way back in the good old days of February, 2020. The event happened at the New York headquarters of the Skowhegan School of Painting and Sculpture. Skowhegan's primary program is an intensive summer residency up in Maine for sixty-five emerging visual artists from all over the world. And in 2015, I had the good fortune of being faculty there, and it was actually there that I took the first steps for what would become this podcast. I was inspired by all the experimentation happening, and I decided to play around with this collection of thoughts I'd jotted down on index cards for the past twenty years as the basis for some sort of performance work. So here we are. My guest, Mike Smith, was also faculty at Skowhegan a couple of years before me and has been a favorite artist of mine for years. He's recently shown work at the Tate Modern in London, and his work is also in the permanent collections of MoMA, the Walker Center, the Georges Pompidou Centre in Paris, and many other places. Here it goes. NEIL: Hi everybody. Thank you so much for coming. So, the premise of the podcast is I typically start with some recent cards, uh, before I bring on a guest. And I thought, uh, this is a recent one: seeing an unflushed toilet at an art school. Now, um, I teach at Yale and, uh, I try to like use the bathroom as far away from where I teach as possible. And I also like to try and mix it up a little bit. So, you know, every now and then I'll go into the basement. Other times I'll go to the second floor. Uh, keep them guessing. And there was a while, very recently at Yale, where every time I walked into a bathroom stall, there was an unflushed toilet full of shit. And I started to think like, okay, is this like a student's like art project? Um, but then beyond that, I really was cognizant of the impact it had on the crits I did later in the day, which is like, I found myself sort of evaluating everything I was seeing in relationship to the impact that seeing a unflushed toilet unexpectedly will have on you. Because think about it, that moment where you're kind of like, you open the stall door and there is the unflushed toilet. That is, I think, what we're all going for as artists. Um. Anyhow.  With all that in mind, I am so happy to have, as my guest, Michael Smith, who I have been a fan of for a very long time. I have actually had the experience, Michael, of going to your shows, and I will say that its impact on me was not unlike that of an unflushed toilet encountered by surprise. So, please welcome Michael Smith. NEIL: Hi, Michael, how are you?  MICHAEL SMITH: I'm okay. I guess I, I don't know if I should be flattered or - what I'm following in terms of the conversation or - NEIL: when in doubt, be flattered.  MICHAEL: Yeah. I have so much to say. I don't know if we'll be able to get to another card.  NEIL: I know, right? Well, what's your elevator pitch for yourself when you? When you encounter someone who doesn't know what it is you do, how do you succinctly describe what it is? MICHAEL: Well, it's usually layered. I usually, I mean, if it's a total stranger, I'll say I'm an artist. And then they say, "Oh, are you a painter?" And I say, no. And then sometimes I'll just cut to the chase and say I'm a performance artist. And then it doesn't go any further.  NEIL: Do you feel like that's accurate though? I mean, that doesn't feel to me like it encompasses the breadth of what you uh, do. MICHAEL: Well, when I first started performing or thinking about performing, I would tell people I was a comic. Because it was, I dunno, it was a little more interesting at parties or whatever. And also performance artist wasn't really part of the vocabulary then. Usually I'd say I'm a comic, and then they'd look at me and they said, "You haven't said anything funny." So, it was like, well, I didn't say I was funny, you know? So.  NEIL: Um, are your parents alive?  MICHAEL: No.  NEIL: When, when they were alive, what would they say that you did?  MICHAEL: My mother probably would say, Michael is Michael. And Michael -  NEIL: That is a full-time job, isn't it?  MICHAEL: Michael had such a sweet voice when he was a child. And my father said, I don't know what the hell he does, you know, he didn't know what it, yeah.  NEIL: Right. I didn't know you were Jewish until quite recently. You're like one of those stealth Jews, you know, Smith. Okay.  MICHAEL: I asked my father once what it was before Smith, and he, he said, Sutton.  NEIL: Sutton? That's like a wall that's been painted multiple times, like, okay, and what was it before Sutton? That's where it gets into like Schmulowitz or whatever. MICHAEL: That got too deep.  NEIL: Yeah, exactly.  MICHAEL: It was, yeah. It's opaque.   NEIL: And what's something on you - today, what's something you've found yourself thinking about? MICHAEL: Well, you know that card you first - NEIL: Oh yeah.  MICHAEL: That card you first brought up. I actually, I've been in my studio for, since '99. And I actually cleaned the toilet in the public bathroom for the, the building because it was just getting a little gross, so I thought I'd clean it.  NEIL: You just took that on yourself?  MICHAEL: I took it on.  NEIL: Wow.  MICHAEL: Yeah. I should also say that when I first came to New York, I was a professional cleaner.  NEIL: Really?  MICHAEL: Yeah. I was very good.  NEIL: I bet.  MICHAEL: Mike the Wipe. I was originally I, I was, I originally was going to be a house - well, I was going to, I advertised in the New York Times, "Mr. Smith will cook and clean." And no one wanted me to cook, you know, just wanted me to clean. NEIL: So many follow-up questions, Mike. Um, shall we move on to the cards? You don't have a choice at this point. We're all in. Uh, this card says: There are no friendly reminders. You know, like, I feel like, is there anything more passive aggressive than someone's like, just a friendly reminder.  MICHAEL: That's like, if they, if they preface what they're going to say with that, yeah. That would be horrible.  NEIL: But they do all the time.  MICHAEL: Really?  NEIL: Yeah. Or in an email - friendly reminder. How many, I mean, haven't you? I've probably gotten a friendly reminder in the last week.  MICHAEL: I guess FYI is not a friendly reminder, huh?  NEIL: No, FYI can be pretty passive aggressive too, but I use it a lot  MICHAEL: BTW?  NEIL: That's fine. Yeah. I dunno.  MICHAEL: So, I have a feeling I probably do it, but I'm not aware of it.  NEIL: Of a friendly reminder?  MICHAEL: Yeah.  NEIL: Hmm. So you're not bothered by it? MICHAEL: Probably, yeah.  NEIL: Probably not bothered by it?  MICHAEL: Probably bothered by it. Yeah, I am. I get bothered by people easily. And I had something really good to say, but I've, I've already forgotten it.  NEIL: I'm excited for the rest of this conversation, Mike. This is, um.  MICHAEL: I'm still thinking about that dirty toilet.  NEIL: We could go back to that anytime you want. NEIL: Uh, this card says: Things that are lost but you know will turn up. Talk to me.  MICHAEL: Well, I, I was with a friend the other day, and, um, I, I said, Oh, I don't, I don't recognize that person. I said, I'm not good with faces. And then she mentioned the name and I said, no, I'm, I don't recognize the name. I'm not good with names. And she said. Mike, what else is there besides faces and names? So anyways, I just wait until it comes, you know, it just till, the name comes, I just wait and wait. And in the morning, I figure, after looking at all those places for the keys or whatever, I'll eventually find it. And then I'll look in the unlikely places and I find it. NEIL: What are the unlikely places in your life for keys?  MICHAEL: You know where I've been to keeping them lately? On my front door. So I go outside and they're always there now, so yeah. That's where I seem to keep them.  NEIL: That is really, why don't we all just keep them there?  MICHAEL: Right. I trust my neighbors, evidently.   NEIL: We just very recently got a knock on the door from our neighbor Arlene. A shout out to Arlene if you're listening, and I know you're not, but, um, bless Arlene who very aggressively knocked on our door. She kind of is like policing the hall in a very loving way, but authoritative. And I left the keys in the door. And um, you could tell Arlene lived for this moment. The keys, they're in the door! You know, it's like, and uh, and then of course I have to like reciprocate with like, um, thank you so much. Oh God. Wow. How did we do that? Thank you, Arlene.  MICHAEL: I have - the person that polices our place, uh, has a Trump hat.  NEIL: Oh no. I don't know if I could deal with that.  MICHAEL: He is taking over the recycling, which is great, but he's got it under lock and key, literally under lock and key. So you go downstairs to get rid of your bottles and stuff. And it takes a lot longer. So then everybody just leaves it down there.  NEIL: Every now and then, forgive me, is there like a, an immigrant child in there as well?  MICHAEL: Oh, there's not an immigrant child, but there is something I think it, I realized it bothers him, that people pick through the garbage and it's mostly like, you know...  NEIL: The people who shouldn't be here. From the shithole countries. MICHAEL: Yeah. So I thought about that later and then I just didn't want to think about it anymore cause I was getting all upset.  NEIL: Um, have you had a political conversation with him or?  MICHAEL: I don't go there. Yeah, he's on, he's a little unstable and he asked, one time he asked me if I wanted to take something outside.  NEIL: Oh, he asked you if you want to, I thought, take something outside like garbage. MICHAEL: Right.  NEIL: But no, he wanted to take a discussion outside.  MICHAEL: Yeah.  NEIL: Wow. I'm gay enough that I have never had that conversation, you know? Uh, or if it is, it's like, it's nasty and it's happened a long time ago and it wasn't a fight. Um, wow. Okay. I'm glad that worked out okay. Uh, this card says: Read my - MICHAEL: Can I be, can I, I had a hard time reading that, kind of, reading them.  NEIL: Yeah. Well.  MICHAEL: Your penmanship is like...  NEIL: Well, I always say if my, if my handwriting were a font, it would be called Suicide Note, so I'm...  MICHAEL: Not judging. I just said I had a hard time, you know, deciphering it at times.  NEIL: Yeah. Read my course evaluations at my funeral. That's what that says.  MICHAEL: Oh, well, I was thinking that when, when I do pass, I would like to get ahead of the thing and have people send out a, uh, an announcement saying, if you happen to be in the neighborhood, you know, come to my show, I'll be like, you know -  NEIL: I'll be here for eternity. MICHAEL: Um, class evaluations. Yeah. I love my class evaluations and I save them and I, I find them very funny. One, I actually made a poster and it was, uh, it was, "I'm not sure if I agree with the way Professor Smith teaches this class. He called my work crap and he called us idiots. This is a waste of my time and money." I was very happy with that.  NEIL: And you made that into a poster?  MICHAEL: I made it into a poster.  NEIL: Do you, do you have any other ones that come to mind? I bet you get great course evaluations.  MICHAEL: Some are good. But like I, I forget them, you know, um, I get them, I still get them handwritten. You're supposed to, a lot of people just go online, but I always, I always hand them out and, and I, I have to leave the room and I always say to them, before, "My livelihood and my future is dependent on how you judge me. And I'm so sorry, I meant to bring the donuts. We'll get to that." NEIL: Huh? See, I try to be real coy about it. Like, you know, they make me do this and, you know, try and like keep it open to, um, other than positive feedback. But obviously it's a desperate wish for approval. MICHAEL: Yeah. I, I always tell them I care deeply for them too, when I'm, yeah. You know, I care deeply for all of you.  NEIL: See, you can,  MICHAEL: One thing - I, one of my students who I happen to, like, he-  NEIL: Happen to like. Whatever.  MICHAEL: He came up to me and he said, you know, Mike, even when we're watching videos in the dark, we always know what you're thinking. We can always read you.  NEIL: Wow. That's a scary thought.  MICHAEL: It is. Cause I'm, I have no filter with, you know, I, I just, it, it comes out, I just sort of convey it with my face.  NEIL: See, I find you, because there is a kind of like genial neutrality, you know, like the, the idea of like quote unquote resting bitch face. You have kind of like resting, mm, bemused face. Um, I find it actually kind of opaque. I wish I knew what you were thinking.  MICHAEL: You know what? A lot of times nothing. I get the feeling I'm not answering the, I'm not answering these cards very, uh.  NEIL: Do you need me to take care of you a little bit right now in terms of - I think you're doing a phenomenal job. You know, this is a fucked up, um, project, by the way, because everyone, like I, I once was doing an iteration of it and this kind of high powered curator said to me, did I do okay, or did I do it right? And I wanted to say like, you did, there's no way of not doing this right, but let's talk about why you've never put me in a show. But that's a different story. The faces of spectators at art world performances. The dutifulness and absence of pleasure. We've all seen this like documentation of a performance at an art event and you see like the spectators, like-  MICHAEL: I often say to my, uh, um, to myself and sometimes my students, where's the joy? Looking for the joy. You're talking about pleasure. I'm looking for the - all the time, I'm wondering about that.  NEIL: Where's the joy? Yeah. I'm stealing the hell out of that for any teaching I do. And also, that would be my teaching evaluation for like 95% of the art I see. I mean, it can be art about, um, Auschwitz and you can still appropriately ask the question, where's the joy? Don't you think? Provocative question.  MICHAEL: Um. NEIL: What was the question?  MICHAEL: No, no, no. I thought I'd get some room tone. You know, we start with the toilet and then we put, where's the joy with Auschwitz. You know, this is- NEIL: This is like a balanced meal or something. I'll take the toilet, joy, and Auschwitz. Well, we'll have to talk about what constitutes dessert within that.  NEIL: Uh, okay. Let's try this: The brutality of a memorial service having a duration. MICHAEL: All right. Are you, a duration, like a time limit or like, um, it doesn't end?  NEIL: You answer it however you want.  MICHAEL: Well, I, I, I think brevity can be good, you know, um, and I don't think I need to go to a durational memorial. I may have misunderstood the question or, not the question, the card. I have been in position where I've, I've helped organize them in a, you know, like emceed them. So you get a little nervous, you know, so you want to keep it like, it becomes like a fucking variety show. NEIL: Exactly. That is so true. Memorial services are a variety show.  MICHAEL: I don't know if that's appropriate. You know?  NEIL: What should it be instead?  MICHAEL: Well, it can, I guess it, it should be kind of free-flowing and with me at the helm, it's not going to be free-flowing. NEIL: Because you keep it, you keep it moving? MICHAEL: I try to, yeah.  NEIL: That's a lot of responsibility. I've never, I, I've done, I, I seem to be the person who you will call to do the slide show for your loved one's memorial. I've done a number of them.  MICHAEL: That's a lot of work.  NEIL: It is. And you can't complain about it. Uh, you know.  MICHAEL: And also you have to be in touch with people to get that material.  NEIL: That I - that I have subcontracted and, you know, but even so, it's a lot of work. And you do not want to fuck that one up. Um. But see, for me, I love the idea of durational, like for those of our listeners who don't know, there's a terminology within the art world of durational art, and to me that is like the height of decadence. Like we have such a surplus of time, you know, that we're going to make art from that surplus or something. You know what I mean?  MICHAEL: I have a, getting back to my students, I have a, um, a three-hand rule.  NEIL: Oh, let's hear it.  MICHAEL: Um, well, if some of the, when I'm covering some work like early seventies, you know, and you kind of get the idea after like five minutes and it goes on. If, if one person, three people raised their hand, we'd go onto the next video.  NEIL: I am learning so much today.  MICHAEL: But I don't think you can do that in memorial service. I don't think that'll, I don't think that'll work, no. NEIL: Oh, that's funny.  MICHAEL: How surprised would they be if you, you mentioned that in the beginning of the memorial? NEIL: Yeah, listen, not to create pressure, but it's kind of like the Apollo where you get the hook. MICHAEL: How am I doing, how am I doing? Yeah. Right.  NEIL: Okay. A bad X you would take over a good Y. So, for me, perpetually, my example is I would take a bad episode of RuPaul's Drag Race over a good Godard movie. So, what's a bad X you would take over a good Y?  MICHAEL: Well, I'm of the school that something bad can have lots of charm. There's something redeeming about it. Where there's something is overly so good, like a certain kind of Broadway kind of, um...  NEIL: Careful.  MICHAEL: Yeah. Well, you understand a certain kind of large delivery or something. A certain styling, a certain song-styling. Um, oh, I'm going to lose the whole audience on this reference. NEIL: Go for it. You have me.  MICHAEL: Okay. The, the, the Bobby Short commercial singing Charlie. I would, I will always cringe at that one. And then I would much rather take a bad public access, uh, commercial than that.  NEIL: There's a fragrance that's here to stay and they call it Charlie. NEIL: Um, so Mike, uh, what is it that keeps you going? MICHAEL: Uh. Hm. I don't know what's keeping me going right now. Um, that's a big one. Um, I, you know, when I was lot younger and doing my work, I, you know, and reinventing the wheel, you know, reinventing the wheel and stuff, I was very excited. But I don't, I wonder what, what keeps me going? No one knows. No one knows. Looking for the joy.  NEIL: On that note, thank you to all of you for being here. Thank you, Mike, for coming to this live taping. Thank you to everyone at Skowhegan. Sarah, Katie, Kris, Carrie, Paige, everyone else. Um, now, this series is made possible with generous support - thank you Jesus - for Still Point Fund. Oh, Siri, something set Siri off. That's, that's my husband, Jeff. Um, oh, sorry. I know, you know, it's interesting. One of the cards I have is every time I stub my toe, I look for someone to blame. And it's often Jeff. And, um, so. Uh, the calls are coming from inside the house. The house being my subjectivity. Let's do that again cause this is important. This series is made possible with generous support from Still Point Fund. Devon Guinn is our producer. Molly Donahue and Aaron Dalton are our consulting producers. Justine Lee handles social media. Our interns are Alara Degirmenci, Jonathan Jalbert, Jesse Kimotho, and Rachel Wang. Our card-flip beats come from Josh Graver. And my husband, Jeff, sings the theme song you're about to hear. And he's going to perform it live. He's a professional. JEFF HILLER: She's a talker with Neil Goldberg. She's A Talker at Skowhegan. She's A Talker, it's better than it sounds. NEIL: Thank you, everybody. Thanks everyone for listening to this bonus episode. Keep your eyes open for She's A Talker, Season Three, coming soon. And in the meantime, be well.

Living Corporate
215 : Creating a Great Place to Work (w/ Michael C. Bush)

Living Corporate

Play Episode Listen Later Apr 21, 2020 38:28


Zach has the honor of speaking with Great Place to Work CEO Michael C. Bush about GPTW itself and the process of creating a great place to work. Michael generously shares what he believes executives should be thinking about when it comes to building better trust within organizations and talks about where he sees Great Place to Work continuing to grow and expand to capture more marginalized voices and experiences.Connect with Michael on LinkedIn and Twitter.Check out Great Place to Work's website. You can review their most recent lists by clicking here.Follow GPTW on social media. They're on LinkedIn, Twitter, Instagram and Facebook.Interested in Michael's book? Find out more about it on Amazon.Find out how the CDC suggests you wash your hands by clicking here.Help food banks respond to COVID-19. Learn more at FeedingAmerica.org.Visit our website.TRANSCRIPTZach: What's up, y'all? It's Zach with Living Corporate, and man, you know what we do. We center and amplify underrepresented voices in the workplace by having authentic, available, and frankly incredible conversations with some incredible guests, and, you know, today is no different, right? Like, we've had who, we've had Robin DiAngelo on, we've had Ruchika Tulshyan, we've had--we've had professors, we've had executives, we've had activists--we've had DeRay Mckesson--we've had all types of folks on the podcast, on the platform, and today is just incredible because we have Michael C. Bush. Michael C. Bush is the CEO of Great Place to Work, the global research and analytics firm that produces the annual Fortune 100 Best Companies to Work For lists. So you know when y'all, you know, see companies and they have, like, the little badge and it'll say, "Oh, we're, like, #5 great place to work," this person we're speaking to is the CEO of Great Place to Work, y'all. This is a big deal. I'm not trying to overhype it. I don't think I can overhype it. I'm just trying to give proper context to who we have on the show. You know, the 100 Best Workplaces for Women list, the Best Workplaces for Diversity list, and dozens of other distinguished workplace rankings around the world. Since 2015, Michael Bush has expanded Great Place to Work’s global mission to build a better world by helping organizations create Great Places to Work not just for the some, but For All. Under his leadership, the firm has developed a higher standard of excellence that accounts for fair and equitable treatment of employees across demographic groups, as well as executive leader effectiveness, innovation, and financial sustainability. His book, A Great Place to Work For All, outlines the compelling business and social benefits that come from these efforts. Michael, first of all, how are you doing?Michael: I'm doing great. Thank you, and honored to be with you today.Zach: It's a pleasure. Now, I'm asking--you know, we're in the midst of a global pandemic, and I would be remiss if I didn't ask how are you doing with your family. Is everyone safe and well? Friends and family, loved ones?Michael: Thanks for asking. Yeah, the world has really changed in the past 45 days, but I'm doing well. I'm sheltering in place here in Oakland, California, with family nearby, so everything's good, and I hope the same for you.Zach: You know, everything is good. It's interesting. It's an interesting time. My wife and I just welcomed our first child into the world just a handful of weeks ago, and it's just an interesting time to be new parents, right, with so much chaos, you know, seemingly all around us, or uncertainty around us, but life is beautiful nonetheless.Michael: Well, congratulations to you and your wife, and yeah, you couldn't have brought, you know, a baby into the world at a crazier time, you know, but things are always a little bit crazy, and what a story you're gonna be able to share with your baby, you know, and we're just gonna do what we're always gonna do, which is make the world a lot better from here.Zach: I love it, absolutely. So let's get into it, right? We talked about it a little bit in the bio that I read. You've been the CEO of Great Place to Work for over 5 years, going on 5 years. Can we talk about your first 100 days as the CEO and, like, what did that look like, you just kind of stepping into that role. And then, you know, in these past five years--I guess Part B to the question is what have you been most proud of since taking the helm?Michael: Yeah. Well, when I stepped into the role in 2015, I got into the role in a strange way. I was actually hired by the founder of Great Place to Work to sell the company, and I had done a lot of turnaround work in the past, and so I came in and worked to do that, and to make a long story short I ended up getting an investment partner and buying the business. So that's how I got into it, and then one of the things that I knew is that I felt like having the analytics of what really was going on for working people all around the world and knowing that there are a lot of working people who never really get a fair shot at being developed, never get a fair shot at being promoted, never get a fair shot at being recognized and rewarded, that I could use--I hoped--the data and the analytics to use recognition to get organizations to change, and so that's really when we made the change, almost instantly, to Great Place to Work for All. I thought that we'd have a platform, and at that time, you know, you never know how things are gonna work out. The business was technically bankrupt, so the first 100 days were what you have to do when you're turning around a company that's bankrupt, which is you have to stop all the money flowing out of the company. So a lot of tough decisions, a lot of tough days where you're just pruning the rose bush so that you can grow, and those times are very difficult, but that's really what the first 100 days were about. Not too much about the future. A lot of pain in trying to cut costs, but we got through it.Zach: When you talk about, like, Great Place to Work for All, like, clearly that's a point of pride for you and, like, kind of continuing to shift and expand the platform or the position that you stepped into. Can we talk a little bit about what it was about that particular--like, why you took that angle, and, like, why was that your point of determined growth for Great Place to Work?Michael: Yeah. Zach, I think the thing that helped me was having a lot of business experience and having been a CEO before as well as working with CEOs. One of the things I knew is that most CEOs, while they talk articulately and clearly and passionately about diversity and inclusion, it's not something they think about that much, you know? They think about it during Black History Month, you know, or other things like that, but beyond that they really don't think about it that much, so it's kind of a head fake because you can hear these things that are very optimistic and passionate, but in fact they just don't think about them that much, and so--they're CEOs, which means they're thinking about other things like shareholder value, stakeholder value, but this one isn't one of 'em. They delegate it, and so they typically delegate it to a chief of diversity and inclusion or maybe a chief of people or a CHRO, but it's delegated, you know? It's not something that they lose a lot of time thinking about, and so I knew that and knew a lot of people, you know, doing diversity and inclusion work, and the common experience was "If you get to a CEO and you say, "Hey, I'd like to talk to you about diversity and inclusion," and they go, "Oh, talk to my chief of diversity and inclusion and I'll see you later." And so they're gone. So I was trying to find a way of keeping them in the conversation by not bringing up diversity and inclusion, and we did that. So when you talk about Great Place to Work for All, they don't leave the room because they're like, "Hey, I'm into that because, you know, that includes me," and also Great Place to Work for All has superior financial business performance. We've got all the data on that, so now they hang in the room, and now they're there and they're present, and now you have an opportunity to share data and information with them to get them into the conversation and hopefully leading the conversation. So it's really--for me it was a Trojan horse. It was how to get into the castle walls and not have somebody come out the castle walls, you know, that was delegated to talk about diversity and inclusion. I felt that the CEO needed to be in that conversation just like they're in the conversation when they're buying the company. They have a head of M&A, but they're in that conversation, so I thought that we could make that happen, and so far so good.Zach: Well, no, it's a great point, and something that you just said rung true with me. I think another example is, like, HSC, right? Like, you talk about health and safety environments, like, the CEO is going to be involved in that conversation by some degree because they recognize the business value and just, like, the imperative of safety for their workplace. Like, they may not be in every single part of the conversation, but they're going to be engaged. If there are other parts of the organization that executive leaders, that CEOs want to be plugged into, I think it's interesting. As much growth as diversity and inclusion has seen, I think that certain language and buzzwords kind of, like, trigger disengagement from the senior-most people. So I find that really interesting and powerful that you were able to figure out kind of, like, I don't want to say the cheat code, but, like, the way to kind of mitigate that a bit.Michael: Yeah, yeah. Cheat code. I hadn't thought about it like that, but that's kind of what it is, and whatever works, you know? Kind of by any means necessary, and so we found that this works, and it not only works in the U.S. When I first did for the for All and started moving it around the world, the first thing we got was resistance because, first of all you're coming from the U.S., and the racial issues are--in the U.S. they are on display for everyone to see and the rest of the world looks at it, but the rest of the world doesn't look at themselves, and so the very resistance was "Well, you're coming from the U.S. We don't have racial issues," which is crazy, because it doesn't matter which country you go to, there's racial issues. But they're not seen the same way. They don't--people don't really self-reflect in the same way. And then, you know, so I was bumping into that, and then what began to happen was people in Sweden started talking about, "Well, really, you know, women aren't treated family," and so for them for All meant that. And so wherever you were in the world - Japan, you know, women, and so there was always some group of people in every country that was treated differently in terms of opportunity and promotion and getting into the C-Suite for example than others. So then it just took off. Then it just took off and really, outside the U.S., it's been embraced more strongly than inside the U.S., 'cause in the U.S., you know, people do say, "Are you using a cheat code?" You know? They're kind of more suspicious, but around the world the thing has really just taken off, and, you know, the book is now in I think 11 different languages and so on just because of that, and CEOs now want to be linked a message that gets them a lot of brand value, and so Great Place to Work for All gets them a lot of brand value. If they talk too much about diversity and inclusion, you know, they actually get blowback from the dominant group in the workforce, and so this is a way that they can get out in front and be totally, totally inclusive without saying inclusive.Zach: It's interesting too that, like, you know, the amount of work that goes into that, right? How can we be inclusive while at the same time not oversignaling to the point where we actually lose the folks in the room who we need to be engaged to create, you know, systemic change and a sense of belonging for everybody? That really kind of leads me to my next question. You know, you're the first--yes, you're the first black male CEO of, like, a major organization or company that we've had on Living Corporate, right? So we've had, like, different senior leaders and executives and directors, but you're the first CEO that we've had. Can we talk a little bit about the role that your previous experience--'cause you talked about it before, about you were a CEO before this, you had industry experience before coming to Great Place to Work--and how your identity plays a role in some of the things that you do and the relationships that you have to make and maintain in your current position?Michael: Yeah. A lot of times people will ask, you know, "How do you get to a CEO?" And the answer is I started, you know, my own company in 1994, and so it really began by breaking out of corporate America. So it wasn't being within it, it was breaking outside of it. There are other journeys. I'm familiar with them. I have, you know, close friends who have done the corporate journey and been able to get to the CEO role. That's one path. It's a very different path than the one that I know the most about, which is the entrepreneurial path. And being an entrepreneur isn't for everybody, just like being a corporate CEO isn't for everybody. It takes two different personalities and two different skill sets really. But for me, on the entrepreneurial path, it was getting a feeling that I was never gonna really be comfortable in the corporate environment. I was never gonna be comfortable. I was always gonna be doing some shapeshifting in that environment, and so once I broke out, okay, then it was great, because I was able to break out and do the things that I needed to do to be successful, and the thing about, you know, so then how do you grow and how do you get to do more, what you gotta do is make rich people more money. So it's--the key is that, you know? It's you better be delivering that value. And so if you create value for people, you have friends for life, and so then you can start to be able to use that momentum. So all of the things that I've done, just like Great Place to Work, what I talk about is profitability. What I talk about is cash flow. So I talk to CEOs about the things that matter to them most. It's all about that. Now, this is the way you do it, but I always go through that door, and I've always gone through that door so people know it's about profitability, it's about EBITA, it's about cash flow, it's about growing market share, and this is the way you do it. You know, this is a way to do it, but it's a business helping another business do a lot more business. I have the data to prove if you make it a Great Place to Work for All you're gonna crush your competitors, you know? The companies that are on our list that are Great Places to Work for All outperform the S&P 500, the Russell 2000 and 3000 by a factor of 3:1, including today, you know, as the market drops. Our companies don't drop as much and they rebound quicker during recovery. So having the data and the analytics, always leading with those numbers, never going to the morally right thing to do but always being about the business enables the CEO to stay there so I can actually--the CEO doesn't leave the room because there aren't a lot of D&I people talking about EBITA, earnings and cash flow. They're talking about other things. So, you know, I'm not saying that there's anything wrong with that. I'm just saying--Zach: It's just the reality of the environment, right?Michael: It's just the reality of the environment, and if you're talking to a CEO about the things they care about, which are those financial metrics, you can begin to talk to them about a lot of things, because they know they're talking to somebody that everything I say is gonna be about enhancing those metrics.Zach: You know, that leads me--Michael, it's almost like you do this a lot, right? It's almost like you talk to folks and you do meetings, interviews, quite a bit, 'cause you're just--you're helping me out. Without getting too much into the secret sauce, like, we understand that Great Place to Work, like, y'all's list is not something that's, like, qualitative, but it's a variety of quantitative analytics, points of measurement. Can you talk a little bit about how the data analytics behind the Great Place to Work rankings has evolved over time and what influenced, if anything, the way that Great Place to Work determines if a company is indeed a Great Place to Work.Michael: Yeah. So we ask the same 60 questions of every company we do business with in 98 countries around the world, so that's one thing that makes us different. Other companies kind of tailor the question set. We're like, "No. We know people. We've got 30 years of data on people." People, you know, the norms might be different, the willingness of a worker to say what they think and what they want might be--they might be more willing and open to it in one country versus another due to social norms, but at the bottom people want the same thing, and so we measure those things. People want to be respected by the people that they work for, so we ask 11 questions that let us know whether you feel respected or not. People want to work for somebody who they feel is transparent with them, so we ask about 9 questions about that. And people want to be treated fairly more important than anything else, so we ask 14 questions about that. And then people want to enjoy the people that they work with and people want to be proud of their work, which means they feel cared for and they care for the people around them, that's what really drives high-performing work, people caring about one another. It's not stock options. Those things don't have the stamina of people. They have to feel like they're doing something they couldn't do on their own and be connected by some sense of purpose. So we measure those things. We ask these questions. We're an analytics company. It's all about the numbers, and we do this with 10 million employees and 10,000 companies every year, so across every single industry. There's not an industry that we don't survey in. So therefore we've got a huge data set to let people know when your people are feeling that in this part of the world things aren't fair, we tell you what that's gonna do to EBITA and profitability and earnings and revenue in that part of the world. We can go straight to the correlation between the employee experience and revenue and these financial metrics, and in some metrics we can go to some causation. We can actually tell you if people aren't feeling emotionally or psychologically or physically safe, those, what I just said, safety defined with those other three attributes drives earnings, you know? It drives earnings is how safe people feel, so we measure those things and therefore can let you know, "Hey, when we see this set of data, we know these people are updating their LinkedIn profiles. They may still be working for you, but they are looking for the next thing to do. So we call it presenteeism. They're present, but they are looking for a way out. So now the data can be used with artificial intelligence to predict what's gonna happen with people. You can see that a person pulls on their--the economy is going good and a person pulls on their 401K and then doesn't return in time not to pay a penalty on that. This person's undergoing some financial pressure, and the financial pressure they're going through affects through employee experience, so we can alert a company that "Hey, you've got a problem here because we can see in this data." So it's all about the data, it's all about the 60 questions, and we measure the employee experience, how they feel about the people they work with, whether they feel like management involves them in decisions that affect them, whether they trust management, whether they have confidence in management. So we ask a set of questions where we can let a leader know exactly what's going on and then compare that so we can--if you're a tech company and you get the data and you don't really know what to think, well, we have a benchmark against other tech companies, and then you go "Whoa, okay, these companies are actually outperforming me in these areas. I want to do something about it." So benchmarking is very important. You can see how Latin America is doing versus South America versus North America or men versus women or people of color versus majority or members of the LGBTQ community versus the majority. You can do all the demographic cuts. The biggest change we made in our methodology since I got involved were these demographic comparisons to see if it was a great place to work for all versus a great place to work for some. That's the revolutionary breakthrough that we've made, and so our lists today are different from the lists in the past because we reward companies that treat everyone the same, where employees are having the same experience and the same in an equitable way, which we're able to measure.Zach: You know, you talked a bit about--you mentioned, like, predictive analytics there, and I'm curious, how far away--and if we're already here, then let me know, but how far away are we from predicting, like, lawsuits or, like, legal action by employees who feel, like, psychologically, emotionally, physically unsafe, who feel, like, discriminated against and things of that nature and then, like, present that to organizations and say, "Hey, look, you have a serious problem, and here's the likelihood of X happening, and then here's the amount of damages that would cost to your brand over X amount of time." Do you think we're anywhere close to that? Do you think that's anything that would be relevant or pertinent for organizations to have?Michael: Well, for some companies they're able to do it right now, and you're talking about where we're heading, absolutely where we're heading. So if you've got an HR system of record on Oracle or a [?] or an SAP or Ultimate software, if you've got an HR system of record--which is a platform that has the payroll information on the employee, the use of benefits on the employee, something around the performance management of the employee, and you have an employee engagement tool that's doing the measuring, and those two are nested and the data can flow between them, you have what you need. And so there are other companies who have what they need and others are heading there now. This is the movement to be able to ask an employee a set of questions and predict what's going on with them and what you need to create a better experience for that employee, which is usually around development and opportunities and promotions and feedback. That's mainly what most people need. Sometimes tailored benefits around things that are going on in their life, like everybody's kind of living through right now. So this is happening at companies now. I'm very much aware of it. We're involved in it by nesting our tool on top of these other platforms, but I would say big companies, Fortune 500 companies, will be totally in this game in 5 years, you know, 100%, and then products will be developed for medium-sized companies and will be in the marketplace--you know, start to enter in about 3 years.Zach: I just find that so intriguing, right? Like, I think about the fact that there's already tools out there that are being mobilized within the next, like, half--within this decade, right? We're gonna start seeing--Micheal: Easily, yeah. At the end of the decade this will--we won't be talking about this.Zach: It won't even be a point of discussion. It's gonna be "Hey, look, no. Your data says this. There's an X percent chance of this happening, and we need to make some adjustments now."Michael: It's absolutely gonna happen, and so machines are already now--at Amazon machines are recommending people for promotion. Machines are recommending people for termination. Machines are doing that. So they're kind of on the cutting edge. Not saying that they're doing that in a great way, I'm just saying--Zach: The technology is out there and it's happening.Michael: It's out there. They're using machine learning tools to make those decisions. Others are going to move on that, and the key is how do you do those things in a way that employees can trust it? Which is a big difference between machine learning and artificial intelligence when there is no trust and a big difference between machine learning and artificial intelligence when there is trust, and if you think about the 60 questions we answer, what are we really, really measuring? It's trust. That's really what we're measuring. Now, we can define it in all its dimensions, but it's trust. Respect is a part of trust. Credibility, transparency is a part of trust. Fairness is a part of trust. So trust is really what we're measuring. We could just double-click all over it to get you additional information, but it's all about trust.Zach: You know, I think--and for me, I'm always curious about when it comes to these lists--and I say this as somebody, of course I love what y'all are doing. I love Great Place to Work. It's the definitive listing space, right? I think it's also interesting because as a black man who has a network of a ton of black and brown people, right, like, we'll look at some of these lists and like, "Dang, okay." I recognize that the overall maybe brand of a company may be really strong, and it's ranked or whatever, but then I wonder like, "Okay, how do I reconcile that with, like, stories that I'm hearing from marginalized people who have had, like, real challenges at these companies?" And I'm curious to know, like, where do you see Great Place to Work continuing to grow and expand to capture, like, marginalized voices and experiences?Michael: Yeah. So Zachary, that's where I was in 2015, exactly where you were, meaning looking at a company--at that time thinking about buying it, looking at the list of the places that were ranked as Great Places to Work, and I knew people of color having horrible experiences in those companies. That's why I bought it, because I'm like, "I think we can do something about this. We can reorder it." And if you look at, you know, 2014, 2013, the companies at the top of that list, they're not at the top now, okay? They're not at the top now, so that's really what happened, but I was exactly where you were and definitely driven to do that. So what it has enabled is, you know, I'm not satisfied by any means. I'm satisfied by the progress, but not by where we are. You know, the thing I talk about it, the bullseye all the time for me is 2030, that that's when we need to get this right, which means--you know, our analytics are driven by algorithms, and so you've got to continually modify the algorithms, and when you modify the algorithm, you've got to live with that algorithm and its output for a year, then you modify it and you've got to live with it for a year. So it's frustrating because it takes a long time, but, you know, we're at the place now where we can say to a company that "Hey, we've measured the experience of different demographic groups, people of color, and we can double-click on it and so on, and their experience is very different from these other groups, therefore you're falling down or off the list." We can do it on that basis now, which that wasn't happening in 2015. There was no way of doing it. We do it now. So we call it maximizing human potential. That's another cheat code, but what it is is we compare one demographic group to another. We reward companies where the gap is small and we penalize companies where the gap is huge. So you can no longer be "80% of our people are having a great time." We go into the people who have given a one or a two response on the Likert scale, you know, that are saying, "My manager involves me in the decisions that affect me? Never or almost never." Okay, well, we grab that group and compare it and put--we give weight to that, a group that it was never done. Another thing is--you know, in terms of there's other lists out there that are recognizing companies, none of them are surveying employees. So really those are marketing-driven exercises.Zach: Right. Those are smiley faces, right?Michael: They are. You know, they're just doing something very different, and so for us, we can let you know--like our diversity lists. You know, there's a few diversity lists, you know, kind of out in the world that are well-known. There's only one that measures and scores the experience of under-represented people. That's Great Place to Work. Our list is driven by their experience, so it doesn't matter, you know, frankly, what white males think about their work experience. We don't measure it for those lists. You know, we don't measure it for those lists. We look at underrepresented people. That's what drives that list. We look at their experience, because that's what it is. For the 100 Best we look at everybody, but we don't for that. So it took us a while, because if I had done that immediately I'd be out of business. So, you know, you've got to build some brand strength and get people to, you know, understand what you're doing and that you're a rational person who wants to grow their business. So it took some time, but we're almost there. I don't feel like we're there right now. We're almost there where we are just pulling in representation into our final ranking criterion. So I feel like we're just about there, and it's enabling us to have some great CEOs who loved being on our list, but now we're able to say, "Hey, guess what?" Even though, you know, we have some companies that, you know, 60, 70% of their workforce are people of color, and they're having a great experience, which is great, but then we look at the top team and we're like, "That doesn't look like them." But the good news is you can have that disconnect and a group of people having a great experience. So that's wonderful, but just think how much better they could be if they could look up and say, "Hey, if I keep working real hard, it's possible for me to get there." "I feel respected now, but I'd really feel respected if that's true." So we're able to talk to CEOs and say, "I know you're happy now." Nobody in hospitality is happy today, but [?] they were happy, 90 days ago they were happy, and you could say, "I know this is great, and I know you're providing a great experience for these people, all these people. That's incredible. We think, you know, the world of you, but you need to do something about this because you'll really unlock them," and the kind of CEOs we deal with, which are the ones who get how this drives their profitability and earnings--and most of these have some moral connection as well in the way that they want to be seen and the way that they want their families to see them. That's kind of another lens that affects a CEO's mindset. So then they go, "Okay, look, I got it," and they don't have to do it, but they choose to do it. So that's when I know, "Okay, this is working now," that this is enabling them to be who they want to be. And a lot of CEOs, I've done a lot of work on the following where you have a CEO moving through their career and just having a great career, a lot of power, a lot of influence, they're happy and satisfied, and then they have a daughter. It changes 'em forever, because then they're like, "I want my daughter to get paid equal pay," but at the company they're running, it's not happening. All of a sudden they start to look at equal pay differently because they had a daughter. I've seen this time and time again, a CEO with a daughter, a CEO with a kid with autism, a CEO with a kid with mental health issues. It modifies the behavior of that CEO and how they--which is great, but that shape-shifting move blows the door open for being a great place to work for all. Now it becomes their thing. They start saying it because they have this new desire to do something and to change the way that others view them and the way that they view themselves.Zach: So first of all this has been an incredible conversation, and, you know, we're coming up on time, Michael, but what I want to do is I want to go back to a word that you used earlier, trust, and really that a lot of these questions go back to--the rankings and the analytics go back to--quantifying trust, and I'm curious to know if you could give us, like, three points of thought that executives should be thinking about when it comes to building better trust within organizations? What would those three points be?Michael: I think that fairness is the most important. So the way you treat a group of people, whether they be analytics versus non-analytics, accountants versus engineers, you need to treat people the same. People read when you're not doing that. They are paying attention to whether you're doing that or not. So being consistent in the way you talk to people, respond to people, what you tweet and what you don't, it matters. So fairness is what's most important, and then making sure your actions--if you say that, you know, diversity drives innovation, people are gonna look and see if you really think that's true. So if you're saying diversity drives innovation and your executive team is not diverse, then now you lose credibility and you're not being transparent and people think it's not fair. The whole pyramid collapses based on you saying one thing and you're actually doing another, and then you want to take a look at your board of directors. You want to take a look at your executive team. You want to take a look at your pipeline and make sure that in 2023 things are going to be different. You want to make sure companies now are restructuring or laying people off. Well, look at the pool that you're laying off. Look at the pool you're restructuring. If you're not careful you're gonna erase ten years of gains is what you're doing right now. So these are the things that build trust. These are the things, fairness more important than anything else. The reason there's resistance to D&I efforts is somehow white men--some--feel like money's being taken out of their pockets.Zach: Right, this scarcity mindset, right?Michael: Yeah, the zero sum game, so you have to--if you have an ERG for African-American professionals, Asian-American professionals, you need to have one that a white male says, "I identify with this one. I identify with this one." They gotta have one too. You can't ignore anyone. It has to be for all.Zach: Michael, this has been great. I just gotta thank you again. Before we go, I'll give you a chance - any shout-outs or parting words, man?Michael: I think that entrepreneurism is a journey that's not for everybody. If you're thinking about it explore it, you know? Talk to some entrepreneurs and see what it's like, but do an honest check with you as to whether or not it's good for you. And then if you're in the corporate environment, lead with the data. You know, the data is what you're gonna need. And know that even if you have all the data, if there are people who aren't interested in diversity and inclusion, you know, the data's not gonna get it done. So, you know, get the data, use the data, make your case with the data, and if you find things are still slow, that's because the leader you're talking to just doesn't want to make a difference. You know, they don't want to change, and so then I'd update my LinkedIn profile and try to find some place where people are using data in the way that they use it for every other decision, whether it be M&A or anything else. You don't want anything different in the D&I area. You just want the consistent behavior, but don't bang your head too long or you're gonna find yourself with a headache.Zach: Michael, thank you so much, man. Look, we're gonna talk to you soon. We consider you a friend of the show. Honored, pleasure to have you. All right, y'all, so that does it for us. This has been Zach with Living Corporate. You know what we do. We're having these authentic conversations even during the rona. I pray that everyone is staying safe out there. You know where to check us out. You can just Google us. We're all over the place, okay? Living Corporate. You type that in and we're gonna pop up on something. You make sure you check us out on our website, living-corporate--please say the dash--dot com, or livingcorporate.co, livingcorporate.org, livingcorporate.net, livingcorporate.tv, livingcorporate.us, okay? Livingcorporate dot... shoot, all the livingcorporates except for livingcorporate.com. We've already talked about this. So if you type in livingcorporate.com it's gonna take you to some Australian website. [?] Australia, but we don't have that domain, okay? So livingcorporate.co, .us, .tv, or living-corporate.com. 'Til next time, y'all. This has been Zach. You've been listening to Michael C. Bush, CEO of Great Place to Work. Catch y'all next time. Peace.

Aufgschnappt
Aufgschnappt Folge 21 Roland Hefter, Franziska Wanninger, Michael Well, Christian Lex u.a.

Aufgschnappt

Play Episode Listen Later Apr 15, 2020 52:11


Good Vibrations from the Corona-Stüberl: Was gibt es Schönes zu berichten aus den letzten Wochen? Worüber hast Du Dich gefreut? - Das habe ich viele liebe und lustige Menschen gefragt und aus ihren Antworten eine bunte Podcast-Folge gebastelt. Stay positive and please don´t grantel!

XR for Business
Enhancing the Hospitality Experience in XR, with UgoVirtual's Michael C. Cohen

XR for Business

Play Episode Listen Later Mar 10, 2020 33:30


Today’s guest — UgoVirtual’s Michael Cohen — describes the hospitality industry like a snowflake – add a little heat and, well, you can imagine. Hotels and cruises rely on proven practices to keep guests happy. Luckily, XR doesn’t have to disrupt those practices; they can build on top of them.  Alan: Coming up next on the XR for Business podcast, we have Michael Cohen from UgoVirtual. We’re going to be talking about how virtual/augmented/mixed reality solutions — or XR solutions — can be used for front-of-house for customer facing activations, from AR to VR. Pre-experiences, what is it like to book this hotel, looking all around you? And also the back-of-house: how do we use this technology to give the best possible training for the staff, so that the customer experience is flawless across the board? All that and more coming up, on the XR for Business podcast, coming up next. Michael, welcome to the show, my friend. Michael: Thank you very much. Really appreciate it, Alan. Alan: It’s my absolute pleasure. It’s been a long time coming. We’ve been kind of doing the dance, watching each other grow. And I’m really excited to learn about what you guys are doing in the hospitality field. It feels like it’s a greenfield opportunity in hospitality, from travel/tourism. A bunch of companies started with, “We’re going to put a 360 camera and let you have a virtual tour.” But explain to us, what are you doing at UgoVirtual, and what is the response so far in the hospitality industry? Michael: Well, first of all, timing is everything, as we know. [chuckles] And the global travel and hospitality industry is absolutely a greenfield opportunity. It’s primed for scale and expansion in regards to XR. The reason being is that there have been investments and there have been initiatives, both on the brand and enterprise level of hospitality and travel companies, but also in startups and larger companies who have enabled, let’s call it a slice of VR or a slice of AR. Or as you mentioned, enabled OK 360 hotel tours that were maybe derivative out of the real estate market and that sort of scenario. Now, the opportunity is very, very serious for UgoVirtual, because we are the travel and hospitality virtual solutions company, very myopically focused to both consult to the major travel and hospitality brands to help them navigate and make investments and strategic decisions for the next three, four, five years on what XR will be for them. And also from our perspective, we have a portfolio of XR oriented solutions that are very focused and linear to the travel and hospitality space. So we’re not taking generic solutions and trying to overlay them on travel and hospitality. The group that’s involved with UgoVirtual — who I’m a strategic advisor to — we’re all 15-20 year veterans on hospitality technology commercialization for the front-of the house, which is guest facing solutions and the back-of-the-house, which is employees and staff. So when you overlay that kind of multi-decade experience on how to get technology efficiently deployed, efficiently commercialized, exceed the demands or the needs of travel and hospitality brands, with these now slowly maturing VR/AR/XR opportunities, it’s a wonderful fit for UgoVirtual right now. Alan: So give us an example. You talked about front-of-house, customer facing solutions. Let’s start with front-of-house and then we’ll go back-of-house. Because I don’t know if you know this, but I actually met my wife working at Delta Hotels in Toronto. Michael: [chuckles] That’s perfect. Alan: Yeah.

XR for Business
Enhancing the Hospitality Experience in XR, with UgoVirtual’s Michael C. Cohen

XR for Business

Play Episode Listen Later Mar 10, 2020 33:30


Today’s guest — UgoVirtual’s Michael Cohen — describes the hospitality industry like a snowflake – add a little heat and, well, you can imagine. Hotels and cruises rely on proven practices to keep guests happy. Luckily, XR doesn’t have to disrupt those practices; they can build on top of them.  Alan: Coming up next on the XR for Business podcast, we have Michael Cohen from UgoVirtual. We’re going to be talking about how virtual/augmented/mixed reality solutions — or XR solutions — can be used for front-of-house for customer facing activations, from AR to VR. Pre-experiences, what is it like to book this hotel, looking all around you? And also the back-of-house: how do we use this technology to give the best possible training for the staff, so that the customer experience is flawless across the board? All that and more coming up, on the XR for Business podcast, coming up next. Michael, welcome to the show, my friend. Michael: Thank you very much. Really appreciate it, Alan. Alan: It’s my absolute pleasure. It’s been a long time coming. We’ve been kind of doing the dance, watching each other grow. And I’m really excited to learn about what you guys are doing in the hospitality field. It feels like it’s a greenfield opportunity in hospitality, from travel/tourism. A bunch of companies started with, “We’re going to put a 360 camera and let you have a virtual tour.” But explain to us, what are you doing at UgoVirtual, and what is the response so far in the hospitality industry? Michael: Well, first of all, timing is everything, as we know. [chuckles] And the global travel and hospitality industry is absolutely a greenfield opportunity. It’s primed for scale and expansion in regards to XR. The reason being is that there have been investments and there have been initiatives, both on the brand and enterprise level of hospitality and travel companies, but also in startups and larger companies who have enabled, let’s call it a slice of VR or a slice of AR. Or as you mentioned, enabled OK 360 hotel tours that were maybe derivative out of the real estate market and that sort of scenario. Now, the opportunity is very, very serious for UgoVirtual, because we are the travel and hospitality virtual solutions company, very myopically focused to both consult to the major travel and hospitality brands to help them navigate and make investments and strategic decisions for the next three, four, five years on what XR will be for them. And also from our perspective, we have a portfolio of XR oriented solutions that are very focused and linear to the travel and hospitality space. So we’re not taking generic solutions and trying to overlay them on travel and hospitality. The group that’s involved with UgoVirtual — who I’m a strategic advisor to — we’re all 15-20 year veterans on hospitality technology commercialization for the front-of the house, which is guest facing solutions and the back-of-the-house, which is employees and staff. So when you overlay that kind of multi-decade experience on how to get technology efficiently deployed, efficiently commercialized, exceed the demands or the needs of travel and hospitality brands, with these now slowly maturing VR/AR/XR opportunities, it’s a wonderful fit for UgoVirtual right now. Alan: So give us an example. You talked about front-of-house, customer facing solutions. Let’s start with front-of-house and then we’ll go back-of-house. Because I don’t know if you know this, but I actually met my wife working at Delta Hotels in Toronto. Michael: [chuckles] That’s perfect. Alan: Yeah.

The Podlets - A Cloud Native Podcast
Keeping up with Cloud Native (Ep 17)

The Podlets - A Cloud Native Podcast

Play Episode Listen Later Feb 17, 2020 50:55


If you work in Kubernetes, cloud native, or any other fast-moving ecosystem, you might have found that keeping up to date with new developments can be incredibly challenging. We think this as well, and so we decided to make today’s episode a tribute to that challenge, as well as a space for sharing the best resources and practices we can think of to help manage it. Of course, there are audiences in this space who require information at various levels of depth, and fortunately the resources to suit each one exist. We get into the many different places we go in order to receive information at each part of the spectrum, such as SIG meetings on YouTube, our favorite Twitter authorities, the KubeWeekly blog, and the most helpful books out there. Another big talking point is the idea of habits or practices that can be helpful in consuming all this information, whether it be waiting for the release notes of a new version, tapping into different TLDR summaries of a topic, streaming videos, or actively writing posts as a way of clarifying and integrating newly learned concepts. In the end, there is no easy way, and passionate as you may be about staying in tune, burnout is a real possibility. So whether you’re just scratching the cloud native surface or up to your eyeballs in base code, join us for today’s conversation because you’re bound to find some use in the resources we share. Follow us: https://twitter.com/thepodlets Website: https://thepodlets.io Feeback: info@thepodlets.io https://github.com/vmware-tanzu/thepodlets/issues Hosts: Carlisia Campos Josh Rosso Duffie Cooley Olive Power Michael Gasch Key Points From This Episode: Audiences and different levels of depth that our guests/hosts follow Kubernetes at. What ‘keeping up’ means: merely following news, or actually grasping every new concept? The impossibility of truly keeping up with Kubernetes as it becomes ever more complex. Patterns used to keep up with new developments: the TWKD website, release notes, etc. Twitter’s helpful provision of information, from opinions to tech content, all in one place. How helpful Cindy Sridharan is on Twitter in her orientation toward distributed systems. The active side of keeping up such as writing posts and helping newcomers. More helpful Twitter accounts such as InfoSec. How books provide one source of deep information as opposed to the noise on Twitter. Books: Programming Kubernetes; Managing Kubernetes; Kubernetes Best Practices. Another great resource for seeing Kubernetes in action: the KubeWeeky blog. A call to watch the SIG playlists on the Kubernetes YouTube channel. Tooling: tab management and Michael’s self-built Twitter searcher. Live streaming and CTF live code demonstrations as another resource. How to keep a team updated using platforms like Slack and Zoom. The importance of organizing shared content on Slack. Challenges around not knowing the most important thing to focus on. Cognitive divergence and the temptation of escaping the isolation of coding by socializing. The idea that not seeing keeping up to date as being a personal sacrifice is dangerous. Using multiple different TLDR summaries to cement a concept in one’s brain. Incentives for users rather than developers of projects to share their experiences. The importance of showing appreciation for free resources in keeping motivation up. Quotes: “An audience I haven’t mentioned is the audience that basically just throws up their hands and walks away because there’s just too much to keep track of, right?” — @mauilion [0:05:15] “Maybe it’s because I’m lazy, I don’t know? But I wait until 1.17 drops, then I go to the release notes and really kind of ingest it because I’ve just struggled so much to kind of keep up with the day to day, ‘We merged this, we didn’t merge this,’ and so on.” — @joshrosso [0:10:18] “If you find value in being up to date with these things, just figure out – there are so many resources out there that address these different audiences and figure out what the right measure for you is. You don’t have to go deep on the code on everything.” — @mauilion [0:27:57] “Actually putting the right content in the right channel, at least from a higher level, helps me decide whether I want to like look at that channel today, and stuff that should be in the channel is not kind of in a conversation channel.” — @opowero [0:32:21] “When I see something that is going to give me the fundamentals, like I have other priorities now, I sort of always want to consume that to learn the fundamentals, because I think in the long term phase of, but then I neglect physically what I need to know to do in the moment.” — @carlisia [0:33:39] “Just do nothing, because our brain needs that. We need to not be listening, not be reading, just nothing. Just sit and look at the ceiling. Our brain needs that. Ideally, look at nature, like look outside, look at the air, go for a walk. We need that, because that recharges the brain.” — @carlisia [0:42:38] “Just consuming and keeping up, that doesn’t necessarily mean you don’t give back.” — @embano1 [0:49:32] Links Mentioned in Today’s Episode: Chris Short — https://chrisshort.net/ Last Week in Kubernetes Development — http://lwkd.info/ 1.17 Release Notes — https://kubernetes.io/docs/setup/release/notes/ Release Notes Filter Page — https://relnotes.k8s.io/ Cindy Sridharan on Twitter — https://twitter.com/copyconstruct InfoSec on Twitter — https://twitter.com/infosec?lang=en Programming Kubernetes on Amazon —https://www.amazon.com/Programming-Kubernetes-Developing-Cloud-Native-Applications/dp/1492047104 Managing Kubernetes on Amazon — https://www.amazon.com/Managing-Kubernetes-Operating-Clusters-World/dp/149203391X Brendan Burns on Twitter — https://twitter.com/brendandburns Kubernetes Best Practices on Amazon — https://www.amazon.com/Kubernetes-Best-Practices-Blueprints-Applications-ebook/dp/B081J62KLW/ KubeWeekly — https://kubeweekly.io/ Kubernetes SIG playlists on YouTube — https://www.youtube.com/channel/UCZ2bu0qutTOM0tHYa_jkIwg/playlists Twitch — https://www.twitch.tv/ Honeycomb — https://www.honeycomb.io/ KubeKon EU 2019 — https://events19.linuxfoundation.org/events/kubecon-cloudnativecon-europe-2019/ Aaron Crickenberger on LinkedIn — https://www.linkedin.com/in/spiffxp/ Stephen Augustus on LinkedIn — https://www.linkedin.com/in/stephenaugustus Office Hours — https://github.com/kubernetes/community/blob/master/events/office-hours.md Transcript: EPISODE 17[INTRODUCTION][0:00:08.7] ANNOUNCER: Welcome to The Podlets Podcast, a weekly show that explores Cloud Native one buzzword at a time. Each week, experts in the field will discuss and contrast distributed systems concepts, practices, tradeoffs and lessons learned to help you on your cloud native journey. This space moves fast and we shouldn’t reinvent the wheel. If you’re an engineer, operator or technically minded decision maker, this podcast is for you.[EPISODE][0:00:41.5] DC: Good afternoon everybody and welcome to The Podlets. In this episode, we’re going to talk about, you know, one of the more challenging things that we all have to do, just kind of keep up with cloud native and how we each approach that and what we do. Today, I have a number of cohosts with me, I have Olive Power.[0:00:56.6] OP: Hi.[0:00:57.4] DC: Carlisia Campos.[0:00:58.6] CC: Hi everybody.[0:00:59.9] DC: Josh Rosso.[0:01:01.3] JR: Hey all.[0:01:02.8] DC: And Michael.[0:01:01.1] MICHAEL: Hey, hello.[0:01:04.8] DC: This episode, we’re going to do something a little different than we normally do. In most of our episodes, we try to remain somewhat objective around the problem and the potential solutions for it, rather than prescribing a particular solution. In this episode, however, since we’re talking about how we keep up with all of the crazy things that happen in such a fast ecosystem, we’re going to probably provide quite a number of examples or resources that you yourself could use to drive and to try and keep up to date with what’s happening out there.Be sure to check out the notes after the episode is over at thepodlets.io and you will find a link to the episodes up at the top part, click down to this episode, and check out the notes. There will be tons of resources. Let’s get started.One of the things I think about that’s interesting about keeping up with something like, you know, a Kubernetes or a fast-moving project, regardless of what that project is, whether it’s Kubernetes or, you know, for a while, it was the Mesos that I was following or OpenStack or a number have been big infrastructure projects that have been very fast moving over time and I think what’s interesting is I find that there’s multiple audiences that we kind of address when we think about what it means to ‘keep up,’ right?Keeping up with something like a project is interesting because I feel like there’s an audience that it’s actually very interested in what’s happening with the design goals or the code base of the project, and there’s an audience that is very specific to wanting to understand at a high level – like, “Give me the State of the World report like every month or so just so I can understand generally what’s happening with the project, like is it thriving? Is it starting to kind of wane? Are there big projects that it’s taking on?”And then there’s like, then I feel like there’s an audience somewhere in the middle there where they really want to see people using the project and understand, and know how to learn from those people who are using it so that they can elevate their own use of that project. They’re not particularly interested in the codebase per se but they do want to understand, are they exploring this project at a depth that makes sense for themselves? What do you all think about that?[0:03:02.0] CC: I think one thing that I want to mention is that this episode, it’s not so much about on-boarding people onto Kubernetes and the Kubernetes ecosystem. We are going to have an episode soon to talk specifically about that. How you get going, like get started. I think Duffy mentioned this so we’re going to be talking about how we all keep up with things. Definitely, there are different audiences, even when we’re talking about keeping up.[0:03:32.6] JR: Yeah, I think what’s funny about your audience descriptions, Duffy, is I feel like I’ve actually slid between those audiences a bit, right? It’s funny, back in the day, Kubernetes like one-four, one-five days, I feel like I was much more like, “What’s going on in the code?” Like trying to keep track of like how things are progressing.Now my role is a lot more focused with working with customers and standing up cube and like making a production ready. I feel like I’m a lot more, kind of reactive and more interested to see like, what features have become stable and impact me, you know what I mean? I’m far less in the weeds than I used to be. It’s a super interesting thing.[0:04:08.3] OP: Yeah, I tend to – for my role, I tend to definitely fall into the number three first which is the kind of general keeping an eye on things. Like when you see like interesting articles pop up that maybe have been linked internally because somebody said, “Oh, check out this article. It’s really interesting.”Then you find that you kind of click through five or six articles similar but then you can kind of flip to that kind of like, “Oh, I’m kind of learning lots of good stuff generally about things that folks are doing.” To actually kind of having to figure out some particular solution for one of my customers and so having to go quite deep into that particular feature.You kind of go – I kind of found myself going right in and then back out, right in, going back out depending on kind of where I am on a particular day of the week. It’s kind of a bit tricky. My brain sometimes doesn’t kind of deal with that sort of deep concentration into one particular topic and then back out again. It’s not easy.I find it quite tough actually some of the time.[0:05:05.0] DC: Yeah, I think we can all agree on that. Keeping track of everything is – it’s why the episode, right? How do we even approach it? It seems – I feel like, an audience I haven’t mentioned is the audience that basically just throws up their hands and walks away because there’s just too much to keep track of, right? I feel like we are all that at some point, you know?I get that.[0:05:26.4] OP: That’s why we have Christmas holidays, right? To kind of refresh the brain.[0:05:31.4] CC: Yeah, I maybe purposefully or maybe not even – not trying to keep up because it is too much, it is a lot, and what I’m trying to do is, go deeper on the things that I already, like sort of know. And things that I am working with on a day to day basis. I only really need to know, I feel like, I really only need to know – because I’m not working directly with customers.My scope is very well defined and I feel that I really only need to know whenever there’s a new Kubernetes release. I need to know what the release is. We usually – every once in a while, we update our project to the – we bump up the Kubernetes release that we are working against and in general, yeah, it’s like if things come my way, if it’s interesting, I’ll take a look, but mostly, I feel like I work in a spiral.If I’m doing codes related to controllers and there’s a conference talk about controllers then okay, let me take a look at this to maybe learn how to design this thing better, implement in a better way if I know more about it. If I’m doing, looking at CRDs, same thing. I really like conference talks for education but that’s not so much keeping up with what’s new. Are we talking about educating ourselves with things that we don’t know about?Things that we don’t know about. Or are we talking about just news?[0:07:15.6] JR: I think it’s everything. That’s a great question. One of my other questions when we were starting to talk about this was like, what is keeping up even mean, right? I mean, does it mean, where do you find resources that are interesting that keep you interested in the project or are you looking for resources that just kind of keep you up to date with what’s changing? It’s a great question.[0:07:36.2] MICHAEL: Actually, there was some problem that I faced when I edit the links that I wanted to share in the show. I started writing the links and then I realized, “Well, most of the stuff is not keeping up with news, it’s actually understanding the technology,” because I cannot keep up.What does help me in understanding specific areas, when I need to dig into them and I think back five or four years into early days of Kubernetes, it was easy to catch up by the time because it was just about Kubernetes. Later right, it became this platform. We realized that it actually this platform thing. Then we extended Kubernetes and then we realized there are CICD-related stuff and operations and monitoring and so the whole ecosystem grew. The landscape grew so much that today, it’s impossible to keep up, right?I think I’m interested in all those patterns that you have developed over the years that help you to manage this, let’s say complexity or stream of information.[0:08:33.9] DC: Yeah, I agree. This year, I was thinking about putting up a talk with Chris Short, it was actually last year. That was about kind of on the same topic of keeping up with it. In that, I kind of did a little research into how that happens and I feel like some of the interesting stuff that came out of that was that there are certain patterns that a project might take on that make it easier or more approachable to, you know, stay in contact with what’s happening.If we take Kubernetes as an example, there are a number of websites I think that pretty much everybody here kind of follows to some degree, that helps, sort of, kind of, address those different audiences that we were talking about.One of the ones that I’ve actually been really impressed with is LWKD which stands for Last Week in Kubernetes Development, and as you can imagine, this is really kind of focused on, kind of – I wouldn’t say it’s like super deep on the development but it is watching for things that are changing, that are interesting to the people who are curating that particular blog post, right?They’ll have things in there like, you know, code freezes coming up on this date, IPV6, IPV4, duel stack is merging, they’ll have like some of the big mile markers that are happening in a particular release and where they are in time as it relates to that release. I think if that’s a great pattern and I think that – it’s a very narrow audience, right? It would really only be interesting to people who are interested in, or who are caught up in the code base, or just trying to understand like, maybe I want a preview of what the release notes might look like, so I might just like look for like a weekly kind of thing.[0:10:03.4] JR: Yeah, speaking of the release notes, right? It’s funny. I do get to look at Last Week in Kubernetes development every now and then. It’s an awesome resource but I’ve gotten to the point where the release notes are probably my most important thing for staying up to date.Maybe it’s because I’m lazy, I don’t know, but I wait till 1.17 drops, then I go to the release notes and really kind of ingest it because I’ve just struggled so much to kind of keep up with the day to day, “We merged this, we didn’t merge this,” and so on. That has been a huge help for me, you know, day to day, week to week, month to month.[0:10:37.0] MICHAEL: Well, what was also helpful just on the release notes that the new filter webpage that they put out in 1.15, starting 1.15. Have you all seen that?[0:10:44.4] JR: I’ve never heard of it.[0:10:45.4] DC: Rel dot, whatever it is. Rel dot –[0:10:47.7] MICHAEL: Yeah, if you can share it Duffy, that’s super useful. Especially like if you want to compare releases and features added and –[0:10:55.2] DC: I’ll have to dig it up as well. I don’t remember exactly what –[0:10:56.7] CC: I’m sorry, say? Which one is that again?[0:10:59.1] MICHAEL: The real notes. I’ll put it in the hackMD.[0:11:02.8] DC: Yeah relnotes.k8s.io which is an interesting one because it’s sort of like a comparison engine that allows you to kind of compare what it would have featured like how to feature relates to different versions of stuff.[0:11:14.4] CC: That’s great. I cannot encourage enough for the listeners to look at the show notes because we have a little document here that we – can I? The resources are amazing. There are so many things that I have never even heard about and sound great – is – I want to go to this whole entire list. Definitely check it out. We might not have time to mention every single thing. I don’t want people to miss on all the goodness that’s been put together.[0:11:48.7] DC: Agreed, and again, if you’re looking for those notes, you just go to the podlets.io. Click on ‘episodes’ at the right? And then look for this episode and you’ll find that it’s there.[0:11:58.0] CC: I can see that a lot of the content in those notes are like Twitter feeds. Speaking personally, I’m not sure I’m at the stage yet where I learn a lot about Twitter feeds in terms of technical content. Do you guys find that it’s more around people’s thoughts around certain things so thought-provoking things around Kubernetes and the ecosystem rather than actual technical content. I mean, that’s my experience so far.But looking at those Twitter feeds, maybe I guess I might need to follow some of those feeds. What do you all think?[0:12:30.0] MICHAEL: Do you mean the tweets are from those like learn [inaudible 0:12:32] or the person to be tweets?[0:12:35.3] OP: You’ve listed some of there, Michael, and some sort of.[0:12:37.6] MICHAEL: I just wanted to get some clarity. The reason I listed so many Twitter accounts there is because Twitter is my only kind of newsfeed if you will. I used Feedly and RSS and others before and emails and threads. But then I just got overwhelmed and I had this feeling of missing out on all of those times.That’s why I said, “Okay, let’s just use Twitter.” To your question, most of these accounts are people who have been in the Kubernetes space for very long, either running Kubernetes, developing on Kubernetes, having opinions about Kubernetes.Opinions in general on topics related to cloud native because we didn’t want to make the search just about Kubernetes. Most of these people, I really appreciate their thoughts and some of them also just a retweet things that they see which I missed somewhere else and not necessarily just opinions. I think It’s a good mix of these accounts, providing options, some guidance, and also just news that I miss out on because not being on the other channels.[0:13:35.6] OP: Yeah, I agree because sometimes you can kind of read – I tend to require a lot of sort of blog posts and sort of web posts which, you know, without realizing it can be kind of opinionated and then, you know, it’s nice to then see some Twitter feeds that kind of actually just kind of give like a couple of words, a kind of a different view which sometimes makes me think “Okay, I understand that topic from a certain article that I’ve read, it’s just really nice to hear a kind of a different take on it through Twitter.”[0:14:03.0] CC: I think some of the accounts, like fewer of the accounts – and there are a bunch of things that – there are listed accounts here that I didn’t know before so I’ll check them out. I think fewer of the accounts are providing technical content, for example, Cindy Sridharan, not pronouncing it correctly but Cindy is great, she puts out a lot of technical content and a lot of technical opinion and observations that is really good to consume. I wish I had time to just read her blog posts and Twitter alone.She’s very oriented towards distributed systems in general, so she’s not even specific just Kubernetes. Most of the accounts are very opinionated and the benefit for me is that sometimes I catch people talking about something that I didn’t even know was a thing. It’s like, “Oh, this is a thing I should know about for the work that I do,” and like Michael was saying, you know, sometimes I catch retweets that I didn’t catch before and I just – I’m not checking out places, I’m not checking – hash tagging Reddit.I rely on Twitter and the people who I follow to – if there is a blog post that sounds important, I just trust that somebody would, that I’m going to see it multiple times until like, “Okay, this is content that is related to something and I’m working on, that I want to get better at.” Then I’ll go and look at it. My sources are mainly Twitter and YouTube and it’s funny because I love blog posts but it’s like I haven’t been reading them because it takes a long time to read a blogpost.I give preference to video because I can just listen while I’m doing stuff. I sort of stopped reading blog post which is sad. I also want to start writing posts because it’s so helpful for me to engrain the things that I’m learning and hopefully it will be helpful to other people too. But in any case, go Duffy.[0:16:02.8] DC: A number of people that I follow – I have been cultivating my feed pretty carefully, trying to get a broad perspective of technical stuff that’s happening. But also I’ve been trying to develop my persona on Twitter a bit more, right? I’m actually trying to build my audience there. What’s interesting there is I’ve been trying to – to that end, what I’ve been doing is like trying to amplify voices that I think aren’t heard enough out there, right?If I see an article by somebody who is just coming into Kubernetes. or just coming into distributed systems and they’ve taken an effort to really lay out something that they found really interesting about pretty much anything, right? I’m like, “Okay, that’s pretty awesome,” and I’ll try to amplify that, right? Sometimes I even get involved or I’ll, not directly in public on Twitter but I’ll offer to help edit or help provide whatever our guidance I can provide around that sort of stuff.If I see people like having a difficult time with a particular project or something like that, I’ll reach out privately and say, “Hey, can I help you with it so you can go out there and do a great job,” you know? That is something I love to do. I think your point about like not necessarily going at Twitter for the deep knowledge stuff but more just like making sure that you have a broad enough awareness of what’s happening in different ecosystems that you’re not surprised by the things when the things change, right?A couple of other people that I follow are Akira Asuta, I can’t say enough about that person. They are amazing, they have been doing like, incredibly deep security stuff as it relates to containerization and stuff like that for quite a while. I’m always like, learning brand new things to me when following folks like that. I’ve been kind of getting more interested in InfoSec Twitter lately, learning how people kind of approach that problem.Also some of the bias arounds that which has been pretty interesting. Both the bias against people who are in InfoSec which seems weird to me. Also, how InfoSec approaches a problem, like do they put it like a learning experience or they approach it like an attack experience.It’s been kind of fascinating to get in there.[0:18:08.1] OP: You know, I kind of use Twitter as well for some of this stuff but you know, books are kind of a resource as well but in my head, kind of like at the opposite scale. You know, I obviously don’t read as many books as I read twitter feeds, right? It’s just kind of like, with Twitter, you can kind of digest the whole of the stuff and with books, it’s kind of like – I tend to be trying – because I know, I’m only going to read – like I’m only going to read maybe one/two books a year.I’ve kind of like – as I said before, blog posts seem to take up my reading time and books kind of tend to be for like on airplanes and stuff. So if – they’re just kind of two opposite resources for me but I find actually, the content of books are probably stuff that I digest a bit more because you know, it’s kind of like, I don’t know, back to the old days. It’s kind of a physical thing on hand and I can kind of read it and digest it a bit more than the kind of throwaway stuff that kind of keeps on Twitter.Because to be honest, I don’t know what’s on Twitter. Who is kind of a person to listen to or who is not or who is – I just try and form my own opinions and then, again, it kind of gets a bit overwhelming, because it’s a lot of content just streaming through continuously, whereas a book, it’s kind of like just one source of information that is kind of like a bit more personal that I can digest a bit more.[0:19:18.1] JR: Any particular book recommendation in 2019, Olive, that you found particularly interesting?[0:19:23.5] OP: I’m still reading, and it’s on the list for the episode notes actually, Programming Kubernetes. I just want to kind of get into that sort of CRD sort of mindset a bit. I think that’s kind of an area that’s interesting and an area that a lot of people will want to use in their organizations, right, because it’s going to do some of the extensibility to Kubernetes that’s just not there out of the box and everybody wants something that’s not out of the box or always in my experience.[0:19:47.4] MICHAEL: I found the Managing Kubernetes, I think was it, by – from Brendan Burns and some other folks which was just released I think in the end of last year. Super deep and that is kind of the opposite to the Programming Kubernetes, because I like that as well. That is more geared towards understanding architecture and operations.Operational concepts –[0:20:05.0] OP: They’re probably the two books I’ve read.[0:20:08.4] MICHAEL: Okay.[0:20:08.9] OP: One a year, remember?[0:20:11.4] MICHAEL: Yeah.[0:20:14.6] OP: Prolific reading.[0:20:19.6] CC: I think if you know what you need to learn about cloud native or Kubernetes, there’s amazing books out there, and if you are still exploring Kubernetes and trying to learn, I cannot recommend this book enough. If you are watching this on YouTube, you’ll see the cover. It’s called Kubernetes Best Practices because it’s about Kubernetes best practices but what they did simultaneously and maybe they didn’t even realize is just they gave a map for the entire thing.You go, “Oh, these are all the elements in Kubernetes.” Of course, it’s saying, “Okay, this is the best way to go about setting the stuff up,” and this is relatively thin but I just think that going through this book, you get really fast overview of the elements in Kubernetes. Then you can go to other books like Managing Kubernetes to go deep and understand all of the knobs and switches.[0:21:24.6] DC: I want to bring it back to the patterns that we see successful projects. Projects that you think are approachable but, you know, projects that are out there that make it easy for you to kind of stay – or easier at least to stay up to date with them, what some of those patterns are that you think are useful for projects.We’re talking about like having a couple of different entry points from kind of a weekly report mechanism, we’ve talked about the one that LWKD is, I don’t think we got to talk about KubeWeekly which is actually a weekly blog that is actually curated by a lot of the CNCF ambassadors. KubeWeekly is also broken up in different sections, so like sometimes they’ll just talk about – but they’re actually going out actively and trying to find articles of people using Kubernetes and then trying to post those.If you’re interested in understanding how people are actually out there using it, then that’s a great place to go find articles that are kind of related to that. What are some other patterns that we see that are out there that are useful for books?[0:22:27.6] DC: One that I really like. Kubernetes, for everyone listening has this notion of special interest groups, SIGs oftentimes. They’re focused on certain areas of the project. There’s some for networking and storage and life cycles of clusters and what’s amazing, I try to watch them somewhat weekly, I don’t always succeed.They’re all on YouTube and if you go to the Kubernetes project YouTube, there’s playlists for every SIG. A lot of times I’m doing work relating to life cycles of clusters. I’ll open up the cluster life cycle playlist and I’ll just watch the weekly meetings. While it doesn’t always pertain to completely to me, it lets me understand kind of where the developers and contributor’s heads are at and where they’re kind of headed with a lot of different things.There’s a link to that as well if anyone wants to check it out.[0:23:15.9] MICHAEL: Exactly, to add to that. If you don’t have the time to watch the videos, the meeting notes that these gentlemen and women put together are amazing. Usually, I just scroll through and if it’s something to triggers, I go into the episode and watch it.[0:23:28.7] OP: I almost feel like we should talk about tooling to handle all of this stuff, for example, right now, I think I have 200 tabs opened. I just started learning about some chrome extensions to manage tabs. I haven’t started really using them but I need. I don’t have a good system. My system is open a video that I’m pretty sure I want to watch and just get to that tab eventually until something happens in my chrome goes bust and I lose everything.I wanted to mention that when we say watch YouTube, some things you don’t need to sit there and actually watch, you can just listen to it and if you pay for the five bucks for YouTube premium – I don’t get a commission you people, but I’m just saying, for me, it’s so helpful. I can just turn off you know, put my phone on my pocket and keep listening to it without having to have the phone open and on the whole time. It’s very handy.It’s just like listening to a podcast. I also listen to podcasts lots of days.[0:24:35.1] MICHAEL: For tooling, since I’m just mostly on Twitter and by the time I was using or starting to use Twitter, they didn’t have this bookmark function, so I was basically abusing likes or favorites at the time, I think, to bookmark. What I realized later, my bookmarks grew, well, my likes grew.I wanted to go back and find something but that through the Twitter search was just impossible. I blew the tiny little go tool, kind of my first exercise there to just parse my likes and then use JQ because it’s all JSON to query and manipulate the stuff. I almost use it every day because I was like, that was a talk or blog post about scheduling and just correct for scheduling and the likes.I’m sure there’s a better tool or way of doing that but for me, that’s mine too. Because that’s my workflow.[0:25:27.6] DC: Both of the two blogs that you mentioned both KubeWeekly and LWKD, they both have the ability to take – you can submit stories to them. If you come across things that are interesting and you’d like to put that up on an aggregator somewhere, this is one of the ways to kind of solve that problem because at least if it gets cleared up on an aggregator, you know that you go back to the aggregator to see it, so that helps.Some other ones I’ve seen out there, I’ve seen people, I’ve seen a number of interesting startups now, starting to kind of like put out a podcast or – and I have started to see a number of people like you know, engaging with Twitch and also doing things like what we do with TJK.io which is like have sort of some kind of a weekly thing where you are just hacking on stuff live and just exploring it whether that is related to – if you think of about TJK is we’re going to do without being related necessarily to anything that we are doing at VMware just anything to do with the community but obviously if you are working for one of the small companies like Honeycomb or some other company.A smaller kind of startup, you can really just get people more aware of that because for some reason people love to watch others code. They love to understand how people go through that, what are their thought process is and I find it awesome as well. I think it is amazing to me how big a draw that is, you know?[0:26:41.1] OP: And is there lots of them out there Duffy? Is that kind of an easy searchable thing or is it like how do you know those things are going on?[0:26:48.4] DC: Oddly enough Twitter, most of the time, yeah. I mean, most of the time I see that kind of stuff happening on Twitter, like somebody will like – I will scope with this or a number of other people will say, “Hey, I am going to do a live stream during this period of time on this,” and I have actually seen a number of people doing live streams on CTFs, which are capture the flags. That one’s really been fascinating to me because it has been how do people think about approaching the security of an application.Like where do they look for weak spots and how do you determine, how do you approach that kind of a problem, which is fascinating. So yeah, I think it is important to remember that like you know, you are not the only one trying to keep up to date with all of this stuff, right? The one thing we all have said pretty consistently here is that it is a lot, and it is not just Kubernetes, right? Like any fast moving project. It could be your favorite Ruby module that has 200 contributors, right?It doesn’t matter what it is, it is a lot to keep a track of, and it represents some of that cognitive overheads that you have to think about. That is a lot to take on. Even if it is overwhelming, if you find value in being up to date with these things, just figure out – there are so many resources out there that address these different audiences and figure out what the right measure for you is. You don’t have to go deep on the code on everything.Sometimes it might be better to just try and find a source of information that gives you a high enough of a view. Maybe you are looking at the blog posts that come out on Kubernetes.io every release and you are just looking at the release notes and if you just read the release notes every release, that is already miles ahead of what I have seen a lot of folks out there when they are starting to ask me questions about how do you keep up to date.[0:28:35.9] JR: I’m curious, we have been talking a lot about keeping up as an individual. Do you all have strategies for how you help, let’s say your overall team, keep up with all the things that are going on? To give an example, Duffy, Olive and myself, at least at one point, were on the same team and we’d go out to disparate customers and see all of these different new things that they are trying to do or new projects that they are using.So we’d have to think about how do we get together and share that internally to make sure we are bringing the whole team along with what is going on in the ecosystem especially from a customer perspective. I know one of the ways that we do that is having demos and things of that nature that we share weekly. Are there other strategies that you all use with your teams to kind of share interesting information and news?[0:29:25.5] M: So what we do is mostly the way we share in our team, and we are a small team. We use Slack. We pre-filter in terms of like if there is stuff that I think is valuable for me and probably not for the whole team – obviously we are not going to share, but I think if it is related to something that the team has or to come grant and then I will share on Slack but we don’t have any formal way. I know people use some reports, weekly reports, or other platforms to distribute but we just use Slack.[0:29:53.0] DC: I think one of the things – one of the patters that we had at [inaudible 0:29:54] that I thought was actually super helpful was that we would engage a conversation. “I learned a cool new thing about whatever today,” and so we would say, “I am going to – ” and then we would start a Zoom call around that and then people could join if they wanted to, to be a part of the live discussion or not, and if they didn’t, they would still be able to see a recorded Zoom pop up in the channel later on.So even if your time zones don’t line up, like I know it is 2 AM or 3 AM or something like that for Olive right now, you can still go back to those recorded sessions and you’ll just see it on your daily Slack stuff. You would be able to see, “Oh there was a conversation about whether you should deploy Kubernetes crossed availibility zones or not. I would like to go see that,” and see what the inputs were, and so that can be helpful.[0:30:42.5] JR: Yeah, that is a super interesting observation. It is almost like remote-first teams that are used to these processes of recording everything and putting it in a Google doc. They are more equipped for that information sharing perhaps than like the water cooler conversations you’d have in the office.[0:30:58.5] OP: And on the Slack or any of the communication tool, we have different channels because we are all in lots of channels and to have channels dedicated to a particular subject is absolutely the way to go because otherwise in my previous company that seem to be kind of one main channel that all the architect used to discussed everything on and you know sometimes you join and you’re like, “What is everybody talking about?”There would be literally about a hundred messages on some sort of theme that I have never heard of. So you come away from that thinking that, “That is the main channel. Where is the bit – is there messages in the middle that I missed that were just normal discussions as opposed to in around the technical stuff,” and so it made me a bit sad, right? I would be like, “I haven’t understood something and there is a whole load of stuff on this channel that I don’t understand.”But it is the kind of central channel for everyone. So I think you end up then start looking up things that they are discussing and then realizing actually that is not really anything related to what I need to know about today or next week. It might be something for the future but I’ve got other stuff to focus on. So my point is that those communication channels for me sometimes can make me feel a little bit behind the curve or very much sort of reactive in trying to jump on things that are actually not really anything to do with me for me now and wasting my time slightly and kind of messing with my head a little bit in that like, “I really need to try and focus out stuff,” and actually putting the right content in the right channel, at least from a higher level, helps me decide whether I want to like look at that channel today, and stuff that should be in the channel is not kind of in a conversation channel. So organization of where that content is, is important to me.[0:32:37.6] CC: I am so in the same page with you Olive. That is the way my brain works as well. I want to have multiple channels, like if we are talking about Slack or any chat tool, but some people have such aversion to multiple channels. They really have a hard time dealing with too many – like testing their threshold of what they think is too many channels. So I am always mindful too, like it has to work for everybody but if it was up to me, there will be one channel per topic. So I know where to focus on.But you said something that is so interesting. How do we even just – like you were saying in the context of channel, multiple channels, and I go, if I need to pay attention to this this week as oppose to like, I don’t need to look at this until some time in the future. How do we even decide what we focus on that is useful for us in the moment versus it would be good for me to know but I don’t need to know right now.I am super bad at this. When I see something that is going to give me the fundamentals, like I have other priorities now, I sort of always want to consume that to learn the fundamentals because I think in the long term phase of, but then I neglect physically what I need to know to do in the moment and I am trying to sort of fish there and get focused on in the moment things. Anybody else have a hard time?[0:34:04.5] DC: You are not alone on that, yeah.[0:34:06.7] CC: It is terrible.[0:34:08.3] MICHAEL: Something that I wish I would do more often as like being a good citizen is like when you read a lot, probably 90% of my time is not writing but reading, maybe even more and then I share and then on Twitter, the tweet for them the most successful ones in terms of retweets or likes are the ones where I do like TLDR’s or some screen captures like too long to read. Where people don’t have the time, they might want to read the article but they don’t have the time.But if you put in like a TLDR like either a tweet or a thread on it, a lot of people would jump onto it because they can just easily capture it and they can still read the full article if they want but that is something that I learned and it is pretty – what is the right word? Helpful to my followers and the community but I just don’t do it that often unfortunately. If I am writing, summarizing, writing, I kind of remember. That is how the brain works. It is a nice side effect.[0:35:04.9] DC: I was saying, this is definitely one of those things where you can be the change you want to see if you, you know?[0:35:08.6] M: Yeah, I know.[0:35:10.0] DC: This is awesome. I would also say that what you just raised Carlisia is like a super valid point. I mean like not everybody’s brain works the same way, right? There are people who are neuro-divergent. There are people who think very linearly and they are very comfortable with that and there are people who don’t. So it is a struggle I think regardless of how your brain is wired to understand to how to prioritize the attention you will give any given subject.In some cases, your brain is not wired – your brain is almost wired against that whole idea, like you are just not set up for success when it comes to figuring out how to prioritize your attention.[0:35:49.0] CC: You hit the nail on the head. We are so set up for failure in that department because there are so many interesting conversations and you want to hop in and you want to be a part of the conversation and part of the group and socialize. Our work is so isolating to really put our heads down and just work, it can be so isolating. So it is great to participate in conversations out there even if it is for only via Twitter. I mean, obviously we are very biased towards Twitter here in this group.But I am not even this on Twitter so just keep that in mind that we are cognizant of that but in any case, I don’t know what the answer is but what I am trying always to cut down on that, those social activities that seem so appealing. I don’t know how to do that from working out.[0:36:43.9] JR: I am in the same boat. 2020, I am hoping to let more of that go and to your point, it is not that there is no value in it. It is just, I don’t know, I am not deriving the same amount of quality out of it because I am so just multiplexed all over the place, right? So we’ll see how it goes.[0:36:59.9] CC: Oh if any listener has opinions and obviously it seems that all of us are helpless in that department. Share with us, please.[0:37:12.5] DC: It is a tricky one. I think it is also interesting because I find that when we talk about things like work-life balance, we think of the idea of maybe work-life balance is that when you come at the end of the day and you go home and you don’t think about work, right? Sometimes we think that work-life balance means that you have a certain amount of time off that you can actually spend with your family and your friends or your community, what have you, and not be engaging on multiple fronts.Just be that – have that be your focus, but when it comes to things like keeping up, when it comes to things like learning or elevating your education and stuff, it seems like, for the most part, and this is just my own assumption, I am curious how you all feel about this, that we don’t – that that doesn’t enter into it, right? Your personal time is totally on the table when it comes to how do you keep up with these things. We don’t even think about it that way, right?I know I personally don’t. I definitely have to do more and cut back on the amount of time that I spend reading. I am right there with Michael on 90% of my time when my eyes are open, they are either reading or staring up on the sky while I try to think about what I am going to write next. You know one way or the other it is like that is what I am doing.[0:38:24.0] CC: Yeah.[0:38:25.1] MICHAEL: I noticed last year on my Twitter feed, more people than the years before will complain about like personal burn out. I saw a pattern, like reading those people’s tweets, I saw a pattern there. It wasn’t really like a spiral and then they realized and they shot down like deleted Twitter from their phones or any messaging and other stuff, and I think I am at the point where I also need to do that when it comes to vacation PDO, or whatever.Because I am just like, as you said Duffy, my free time is on the table when it comes to Twitter and catching up and keeping up because work-life balance in my mind is not work but what is not work for like – Kubernetes is exciting, adding in all the space, like what is not work there? I need to really get better at that because I think I might end in the same spiral of just soaking in more until I just –[0:39:17.7] CC: Yeah and like Josh said, it is not that there isn’t a value. Obviously we derive a huge value, that is why we’re on it, but you have to weigh things and what are your goals and is that the best way to your goals from where you are right now, and maybe you know, Twitter you use for a while, ramp up your knowledge, ramp up the connections because it is great for making connections, and then you step back and focus on something else, then to go on a cycle.This is how I am thinking now. It is just like what Olive was saying, you know, books are great, blog posts are great, and I absolutely agree with that. It is just that I don’t have even the time and when I have the time, I would be reading code and I would be reading things all day long, it is just really tiring for me at the end of the day to sit down and read more. I want to invest in learning how to speed read to solve that problem because I read a lot of books and blog posts. So something on my list.[0:40:22.8] DC: One of the biggest tips on speed reading I ever learned is that frequently when you read you think of saying the word and if you can get out of that habit, if you get out of the habit of saying the word even with your mouth or you just get out of that habit that will already increase the quickness of what you read.[0:40:39.5] CC: That is so interesting.[0:40:41.4] DC: Yeah, that is a trippy one.[0:40:43.1] CC: Because I think being bilingual, I totally like – that really helps me understand things, by saying the words.[0:40:52.9] DC: I think the point that we are all working around here is, there is a great panel that came out at KubeCon EU in 2019 was put on by Aaron Crickenberger, Esther McNaMara, Steven Augustus, these folks are all very high output people. I mean, they do a lot of stuff especially with regard to community and so they put on a panel that was talking about burn out and self-care and I think that it is definitely worth checking that one out.And actually also thinking about what keeping up means to you and making sure that you are measuring that against your ability to sustain, is incredibly important, right? I feel like keeping up is one of those subjects where we end up – it is almost insidious in its way to – it is a thing that we can just do all the time. We can just spend all of our time, any free moment that you have, you are sitting on the bus, you are trying to keep up with things.And because that happens so much, I feel like that is sort of one of the ways that we can feel burnt out as you are seeing today. We can feel like we did a lot of things but there was no real result to it and keep in mind that that’s part of it, right? Like when you are thinking about how we are keeping up with it, make sure that the value to your time is still something that you have some cognizance about, that you have some thought about, like is it worth it to me to just spend this six hours reading everything, right?Or would it be better for me to spend some amount of time just not reading, you know? Like doing something else, you know? Like bake a cake for crying out loud, you know?[0:42:29.5] CC: Something that a lot of times we don’t allow ourselves to do and I decided to speak for everybody I am sorry, I just do nothing, because our brain needs that. We need to not be listening, not be reading, just nothing. Just sit and look at the ceiling, our brain needs that. Ideally, look at nature, like look outside, look at the air, go for a walk. We need that, because that recharges the brain. Anyway, one thing also that I want to bring up, maybe we can mention real quick because we are coming up at the top of the hour.How do people, projects, how do we really help the users of those projects to be up to date with what they are doing?[0:43:18.4] DC: Well yeah I mean this is the different patterns that we are talking about. So I think the blog posts help. I like the idea of having blogs that are targeted towards different audiences. I like the idea of having an aggregate here for putting up a big project. I mean obviously Kubernetes is such a huge ecosystem that if you have things like KubeWeekly and I know that there are actually quite a number of things out there that try and do this.But if we can kind of agree on one like KubeWeekly I think is a pretty good one because it is actually run by the CNCF. So it kind of falls within that sort of governance as a model but having an aggregator where you can actually produce content or curate content as it relates to your project that’s helpful, and then office-hours I think is also helpful to Josh’s point. I mean office-hours and SIG hours are very similar things. I mean like office-hours there like how to developers think about what’s happening with the space.This is an opportunity for you as an end user to show up and ask questions, those sorts of patterns I think all are incredibly helpful as a project to figure out there to those things.[0:44:17.8] OP: Yeah, I know summary articles or the sort of TLDRs that Michael mentioned earlier, I think I need more of those things in my life because I do a lot of reading, because I think my brain is a bit weird in that I need to read something about five or six different times from five or six different articles for it to sort of frame in my head.So what I am trying to – like for 2020, I have almost tried to do this, is like if I think somebody knows all about this and it would save me reading those five, six, seven articles and if that person has the time, I try and sort of reach out to them and say, “Listen, have you got 20 minutes or so to explain this topic to me? Can I ask you questions about it?” It just saves me, saves my eyes reading the screen, and it just saves me time. I just need a TLDR summary of a project or a feature or something just so I can know what it is all about in my head and talk fairly sort of confidently about it.If I need to get in front and down under the weeds then there is more reading to kind of do for me maybe the coding on the technical side, but sometimes I can’t figure out what this feature sort of means and what is its use case in the real world and I have to read through lots of articles and sometimes kind of vendor specific ones and they’ve got a different slant than maybe an independent one and trying to marry those bits up my head is a bit hard for me and there is sort of wealth of information.So if you are interested in a topic and there is hundreds of articles and you start reading four or five and they are all slightly different, eventually you figure out that – you are confident and I understand what that product is about but it has taken a long time to get there and it is taken a lot of reading time. So TLDRs is like really work and I think as Josh mentioned before, we have this thing internally where we do bench demos.And that is like a TLDR and a show and tell really quickly, like, “This is what this does and this is why we need to know about it and this is why our customers needs to know about it, the end,” you know? And that’s really, really useful because that just saves a whole bunch of people a whole bunch of time figuring out A, whether they need to know about it and B, actually now understanding that product or feature at the end of the five, 10 minutes which is what they typically are. So they are very useful short snippets of information. Maybe we are back to Twitter.[0:46:37.8] JR: Similar to the idea of giving a demo Olive, you made me think of something and that is that I think one of the ways that I keep up with the space is actually through writing along with reading and I think the notion of like – and this admittedly takes up time and the whole quality of life conversation comes in but using writing to help develop your thoughts and kind of aggregate all of these crazy inputs and try to be somewhat concise, which I know I struggle with, around something I’ve learned.It’s helped me a ton and then that asset kind of becomes reusable to share with other people the thing that you wrote. So for people listening to this I guess maybe a call to action for 2020 if that is your style as well, consider starting to write yourself and becoming a resource, right? Because even if you are new to this space, you’d be amazed at just how writing from your perspective can help other people.[0:47:26.3] DC: I think another one that I actually have been impressed with lately is that a number of consumer companies like people out there like Lyft and companies like that have actually started to surface engineering blogs around how they are using technology and how they are using technology to solve things, which I think, as a service provider, as somebody who is involved in the community of Kubernetes, I find those to be incredibly valuable because I get to actually see how those things are doing.I mean at the same time, I see things like – we talked about KubeCon, which is a convention that they have every year. Obviously the project is large enough to support it but there is actually an incentive if you are a consumer of that project to go and talk about how you are using it, right? It is incentivized in that it is more likely your talk will be accepted if you are a consumer of the product than somebody building it, right? We hear from people building it all the time.I love that idea of incentivizing people who are using this thing get out there and talk about it or share their ideas about it or how they are using it, what problems did it solve for them. That is critical I think.[0:48:31.0] CC: Can I also make a suggestion – is to not so much following on the thread that we are talking about just now but kind of on the general thread of this episode. If you have resources that you do use to keep up with things, stop this recording right now and go and give them a like, give them a follow, give them a thumbs up, show somehow appreciation because what Duffy said just now, he was saying, “Oh it is so helpful when I read a blog post.”But people who are writing, they want to know that. So give them some indication, it counts a lot. It takes a lot of effort to sit down and write something or produce a podcast and if you take any, derive any benefit from it, show appreciation. It motivates people to keep doing it.[0:49:26.4] DC: Yeah, agreed.[0:49:27.9] M: I think that is a great bind maybe to close off this episode because it reiterates that just consuming and keeping up that doesn’t necessarily mean you don’t give back, right? So this is a way of giving back, which is really important to keep that flow and creativeness.[0:49:41.8] CC: I go through a lot of YouTube videos and sometimes I just play one after the other but sometimes, you know, I have been making a point of going back and liking it. Liking the ones that I like – obviously I don’t like everything. I mean things that I don’t like I don’t listen in but you know what I mean? It takes no effort but just so people know, “OK, you did a good job here.” By the way, go to iTunes and rate us. So we will know that you liked it and it will help people find our show, our podcast, and if you are watching us on YouTube, give us a like.[0:50:16.1] DC: All right, well unless anybody has any final thoughts, that is what we wanted to cover this session. So thank you all very, very much and I look forward to seeing you next week.[0:50:25.3] M: Bye-bye.[0:50:26.3] CC: Thank you so much.[0:50:27.4] OP: Bye.[0:50:28.1] JR: Bye.[END OF EPISODE][0:50:28.7] ANNOUNCER: Thank you for listening to The Podlets Cloud Native Podcast. Find us on Twitter at https://twitter.com/ThePodlets and on the http://thepodlets.io/ website, where you'll find transcripts and show notes. We'll be back next week. Stay tuned by subscribing.[END]See omnystudio.com/listener for privacy information.

XR for Business
The Sound of XR, with Bose's Michael Ludden

XR for Business

Play Episode Listen Later Jan 10, 2020 27:25


Your various realities — virtual, augmented, X, etc — are often talked about in the realm of vision, since we humans lean on vision as our major sense. But the folks at Bose, like today’s guest Michael Ludden, know that there’s room for sound in XR too. Alan: Welcome to the XR for Business Podcast with your host, Alan Smithson. Today’s guest is Michael Ludden, global head of developer advocacy and principal augmented reality advocate at Bose Technologies. Michael is a technologist, futurist, strategist, product leader, and developer platform expert who loves to operate on the bleeding edge of what’s possible, and is a frequent keynote speaker at events around the world. Michael was previously director of IBM’s Watson’s Developer Lab for a AR and VR, among some other career stops. To learn more about the work he’s doing at Bose, you can visit developer.bose.com. Michael, welcome to the show. Michael: Wow, what an intro. Thanks for having me. Alan: It’s my absolute pleasure and honor to have you on the show. I’m super excited. I was talking to all fine and last week. I was flying from Toronto to San Francisco, and I just happened to sit beside a guy who we started talking about AR and I pulled out the North Glasses. He pulled out the Bose Frames; we swap. And we had this kind of meeting of the minds. I had the visual, he had the audio and it was really cool that I got to try the Bose Frames. What an amazing piece of technology. Michael: Glad you liked it. Alan: So you’ve had a storied career here. You’ve done everything from IBM Watson, to Google, to HTC, Samsung. How did you end up in technology, and why did you get so fascinated on futurism? Michael: Well, it’s sort of been a running theme in my life. I read a lot of science fiction as a kid and I was always interested in technology and — not to date myself — but at a certain point in my life when I was a young adult, technology started to really aggressively eat everything, starting with mobile. And I just found that was really the point of inflection in my life where I studied musical theater in college, I went to UCLA. I thought that’s what I was going to do. I really did. And I did get a B.A. so I got a little arts education, too. And at the same time, I was always tinkering with stuff, building my own PCs. I started my own web development company at one point to make Web sites in Flash, CS2, and CS3 in the early days; it was brutal. Alan: There’s a conference in Toronto called Flash in the Can; FITC. Michael: Nice. Alan: That’s old school. Michael: It is very old school. And, you know, I never really thought I’d make a career out of it, but I needed money. I was a starving actor in L.A. and one of my friends who I just made by being nerdy, worked for a company called HTC. They were releasing the first-ever Android phone, which was called The Dream — or the G1 in the US. So I was in contact with this guy; he got a promotion. He said, “you should take my old job,” which was L.A.-based, and I was living there. And I said, “I want to do it.” I was working on a podcasting platform called This Week In — not This Week in Tech — but This Week In. It was a Jason Calacanis-led network out of the old Mahalo Studios in Santa Monica. But it paid me pennies. And when they told me what the job paid and what I’d be doing, I said, “OK, I guess I’ll do it.” I needed the money, and it was very flexible. It felt really easy to me, like that’s really all you need me to d

XR for Business
The Sound of XR, with Bose’s Michael Ludden

XR for Business

Play Episode Listen Later Jan 10, 2020 27:25


Your various realities — virtual, augmented, X, etc — are often talked about in the realm of vision, since we humans lean on vision as our major sense. But the folks at Bose, like today’s guest Michael Ludden, know that there’s room for sound in XR too. Alan: Welcome to the XR for Business Podcast with your host, Alan Smithson. Today’s guest is Michael Ludden, global head of developer advocacy and principal augmented reality advocate at Bose Technologies. Michael is a technologist, futurist, strategist, product leader, and developer platform expert who loves to operate on the bleeding edge of what’s possible, and is a frequent keynote speaker at events around the world. Michael was previously director of IBM’s Watson’s Developer Lab for a AR and VR, among some other career stops. To learn more about the work he’s doing at Bose, you can visit developer.bose.com. Michael, welcome to the show. Michael: Wow, what an intro. Thanks for having me. Alan: It’s my absolute pleasure and honor to have you on the show. I’m super excited. I was talking to all fine and last week. I was flying from Toronto to San Francisco, and I just happened to sit beside a guy who we started talking about AR and I pulled out the North Glasses. He pulled out the Bose Frames; we swap. And we had this kind of meeting of the minds. I had the visual, he had the audio and it was really cool that I got to try the Bose Frames. What an amazing piece of technology. Michael: Glad you liked it. Alan: So you’ve had a storied career here. You’ve done everything from IBM Watson, to Google, to HTC, Samsung. How did you end up in technology, and why did you get so fascinated on futurism? Michael: Well, it’s sort of been a running theme in my life. I read a lot of science fiction as a kid and I was always interested in technology and — not to date myself — but at a certain point in my life when I was a young adult, technology started to really aggressively eat everything, starting with mobile. And I just found that was really the point of inflection in my life where I studied musical theater in college, I went to UCLA. I thought that’s what I was going to do. I really did. And I did get a B.A. so I got a little arts education, too. And at the same time, I was always tinkering with stuff, building my own PCs. I started my own web development company at one point to make Web sites in Flash, CS2, and CS3 in the early days; it was brutal. Alan: There’s a conference in Toronto called Flash in the Can; FITC. Michael: Nice. Alan: That’s old school. Michael: It is very old school. And, you know, I never really thought I’d make a career out of it, but I needed money. I was a starving actor in L.A. and one of my friends who I just made by being nerdy, worked for a company called HTC. They were releasing the first-ever Android phone, which was called The Dream — or the G1 in the US. So I was in contact with this guy; he got a promotion. He said, “you should take my old job,” which was L.A.-based, and I was living there. And I said, “I want to do it.” I was working on a podcasting platform called This Week In — not This Week in Tech — but This Week In. It was a Jason Calacanis-led network out of the old Mahalo Studios in Santa Monica. But it paid me pennies. And when they told me what the job paid and what I’d be doing, I said, “OK, I guess I’ll do it.” I needed the money, and it was very flexible. It felt really easy to me, like that’s really all you need me to d

Aufgschnappt
Aufgschnappt Folge 13 mit Michael Well (eh. Biermösl Blosn, Well-Brüder)

Aufgschnappt

Play Episode Listen Later Dec 11, 2019 55:46


In der letzten Folge 2019 (juhu, nächstes Jahr geht es weiter!) ist Michael Well zu Gast, wir unterhalten uns über unsere Arbeit in der Agentur, über seine musikalische Familie, über unseren aufregenden Auftritt mit Gerhard Polt und den drei Haxn und natürlich über Weihnachten. Happy Abfent!

The Informed Life
Michael J. Metts on Writing as Design

The Informed Life

Play Episode Listen Later Dec 8, 2019 29:20 Transcription Available


My guest today is Michael J. Metts. Michael designs digital products and services, with a focus on the impact of writing on the user's experience. He and co-author Andy Welfle have written a new book on this subject. In this conversation, Michael and I discuss the relationship between writing and design, and how being more aware of how we use language can make us more effective. Listen to the full conversation https://theinformeddotlife.files.wordpress.com/2019/12/the-informed-life-episode-24-michael-j-metts.mp3   Show notes Michael J. Metts on Twitter Michael J. Metts on LinkedIn Michael J. Metts on Instagram Michael's blog Writing is Designing: Words and the User Experience, by Michael J. Metts & Andy Welfle Card sorting Tree testing The Informed Life Episode 11: Lisa Welchman on Governance Microsoft Word GOV.UK highlighter method IA Writer Ulysses Markdown Slack Microsoft Teams Read the full transcript Jorge: So, Michael, welcome to the show. Michael: Thanks, it's great to be here. Jorge: Well, it's great to have you. For folks who don't know you, why don't you tell us about yourself. Michael: Well, I have spent the better part of my career now designing digital experiences of different kinds. I initially began in that field as a writer, in terms of what people called me, my title and that kind of thing. And now I have titles like designer, but there's been a lot of crossover between those two worlds throughout my career. Jorge: So, you and your coauthor Andy Welfle have written a book called Writing is Designing, which addresses this subject. How do design and writing relate to each other? Michael: Yeah, I think It's hard for a lot of people to make that connection because you run into a lot of people who tend to be wired one way or the other or feel like they're more capable in one area than the other. But really, if you think about any sort of experience that you interact with, like a mobile app, that's the one we use as an example right in the beginning of the book. Your mobile app, if you open it up and you start tapping through it, you start looking at it, you start to see words everywhere. You're interacting with language just as much as you're interacting with visual elements like menu items and buttons and all those other things. So, our thesis really is just that you should treat those words as part of the design and that you should apply design techniques and practices to those words and how you get there, and not treat them as something that's inconsequential or after the fact. So, we've done that in our own careers, and we've seen how vital it is to building a good experience, and we just want to share that with others. Jorge: I think that the word design for a lot of folks evokes visual artifacts like drawings and sketches and stuff like that. And when you say that you apply design techniques, can you tell us a bit more about what that looks like? Michael: Yeah. So, design, it took me a while in my own career to make that shift from thinking of design as something that was inherently visual. I think the first type of design people interact with usually is graphic design, if you've come across designs of signs and brochures and handouts and different things like that. And you can kind of tell inherently if one is designed well or if it's designed poorly. But you know, the, the thing about it is that the words that make up those artifacts are typically the same, whether it's designed well or designed poorly. So, I think that's why people tend to think of design is like the polish that comes at the end. But the way I think of design, and I think the way a lot of my field thinks about design, is that you design the experience someone has with a thing. And when you frame it that way, then you begin to think of it more broadly, and you begin to think of all the things that impact it. So, it's not just words, it's not just visuals, it's maybe even the business policies that affect how that thing works, or maybe it's the number of steps involved. All those things are critical pieces of the design that you can't even see as the person using it. So that's why, when I talk about design techniques when I'm talking about is thinking of prototyping the language you use and testing it with people to see how they respond. So, a prototype of language can just be some written sentences on a piece of paper that you go and ask people about, you ask them to read through it and ask how they perceive it. Those are all valid ways to design the language we're using rather than just writing it and going forward with it without really thinking about the impact it has or actually getting information about the impact it has on the people who interact with Jorge: You talked about an example of a mobile app and the words that you see in the screen, and that is one way of encountering language. You also have just talked about a sentence, and that strikes me as a very different way of encountering language. The former is within the realm of what I understand of as information architecture, right? Like this notion that you create these structures of language that allow you to understand and move about an information environment. Are you more of a writer of sentences or a writer of user interfaces?  Michael: Even in interfaces, there's always a tension between what the experience is trying to do and how people feel about the language you're working in, whether it's English or any other language. Maybe you feel like those error messages should be sentences, right? And maybe you're applying all the same thoughts that you would when coming up with a sentence for an essay or something to the way you write that error message. But the important thing is that you unpack it and think about why you're thinking that way. Think about what's appropriate for that particular use case and be intentional. Like that's what I mean by designing with words. So, a sentence could be part of that information architecture you're describing, and there's nothing wrong with that, but the important thing is unpacking why and being clear about it. This is something Andy and I do for a living every day, and then we wrote a book about it, which was a very different way of writing and a very different way of expressing our ideas than the type of writing we'd done for these digital products. And so I think we saw a lot of things creep in to our writing that we didn't see every day in our work. So, in trying to string all these sentences together into a book, that was a really interesting exercise and it was very, very different. So, the writing definitely is different. You know, you're writing in a digital product, you're writing to help someone move through a situation, your writing started to be invisible. You're not trying to draw attention to yourself, to talk about the merit of your ideas. I mean, those things. So that to me is where the line is, you know, it's more about your intention and about what you're trying to do with it. Jorge: When you used the mobile app image, the image that it evoked in my mind had to do with things like heading labels and navigation links. But you talked about the error messages. Error messages to me are more prose-like in that you have to give the user a little bit more context of what's going on. Whereas with things like labels, you're peppering words around the thing. You have a little bit less of that kind of sentence structure to play with. And I'm wondering if there's a difference in writing for the one versus the other. Michael: That's interesting. I think people who have jobs like mine are asked to drift in and out of those spaces without thinking about the boundaries. Because it's interesting that, in your mind, there's a very clear boundary between the two, but one of the challenges as someone who writes for a digital product, you have to figure out how to make it seem like there isn't, you have to make it feel like this is a cohesive experience where all this language works together and fits together. So, obviously there are big differences. Like you may have fewer iterations of that structural stuff, like if you think of the items in a navigation, you may do testing — you know, there are really specific testing techniques in the world of information architecture, like cards sorts or tree testing to help you figure out what those things should be. And you're not really trying to mess with them a whole lot after that or iterate on them a whole lot, unless you have reason to believe that they're not working that well, or unless there are changes in the organization. So those are like really big structural things. The rest of the language though, it really has to fit into everything else the user's experiencing. So, examples of the types of writing, you have the error message, you have the push notification, you have onboarding messages, you have a little tips and helpful hints that pop up throughout the experience. That's very specific to the mobile app experience. So then if you have something like a voice experience or a chat bot, then you have dialogue that has to accomplish all those things just as text, as language. So, there are definitely different ways to think about it, different techniques you use when you're working with those things. But they do all have to work together. And that to me is the exciting thing about seeing it come together and practicing this type of work, is that you can start to build a whole ecosystem of language within whenever you're working on. Jorge: How is that ecosystem of language managed? Michael: I think it's different for everyone, you know, every organization. There's a really encouraging trend in design systems recently. I think design systems originally began as pattern libraries where people would put like their front-end code in a place where it was manageable. And then it became a place where you could talk about design standards and visual specs and things like that. And now the latest trend, which is really cool, is that you're describing patterns that are more structural. So, things like the language we use and how we write for certain situations and how you keep it consistent and how you may have a clear voice for your product that comes across. So to me, that's one of the more common ways I've seen it happen. There's also style guides many companies are using and then adapting style guides to their own means. Those tend to be more at the individual word level, word choice or an abbreviation or things like that. I think this trend of design systems is a really neat one. Jorge: Are there any tools that you've seen or used to help do that? Michael: It's an interesting thing, because in websites you have the sort of foregone conclusion is that you have a CMS, right? You have this content management system. Products usually don't, or if they do, it's nothing like their website CMS, which is designed to run an author experience. Okay. So that is interesting. I think it's a space we'll see a lot more, and I think are a few startups and companies that are experimenting with things like that. But honestly, a lot of times when I'm trying to manage content for our product, I will partner with the engineering team and we'll work directly in the code, so they might do some sort of a markup language that makes it easier for me to write and contributing. But that helps us look at like, okay, here's everything that's in the system, and maybe we could just reuse this over again in this situation, or maybe this necessitates a new variation that we haven't thought of before. So, I think it's really an emerging space, which is kind of surprising to me, but at the same time, I guess you're moving so quickly, you're not really thinking about how to control that language. It's easy enough to just put it, to use the code to manage it.  Jorge: And beyond tools, I'm also wondering what is the role in the organization who has the ultimate responsibility for managing language? Michael: That's a really interesting question. I know you had Lisa Welchman on your show a while back, and she was talking about how organizations manage the content governance and the types of things they go through. And I think it's interesting because I don't know how many organizations are thinking of governance, in terms of what shows up in a product, in terms of what shows up in an interactive experience. I feel like it's usually thought of in terms of the static web content. So, I think there's a need for that. And I think what makes it complex is that there's no clear owner and there's no clear role. You know, everyone is capable of writing. Like if you have a job working on one of these digital products, chances are you're fairly competent as a writer, or at least you think so. So, if someone asks you, ” Hey, can you write this?” You'll do your best and you'll get it out there. And all you need is a word processor. You know, you fire up Microsoft Word and get something down. And that's really different from the way design in the traditional sense is practiced now, where you have a tool that's very difficult to learn and has a lot of quirks to it, and you've invested a lot of time in learning that tool, and you can use that tool as a governance mechanism in itself. You can say, “Well, I'm the one who uses the tool. So, I decided the designs.” And I think that's why designers of words have a harder time. In a sense because they're going to have to rely on building relationships and building trust and making a case for why we should use this particular language because it feels so accessible and malleable by just about anyone. If you're a designer with words, you don't have a tool to fall back on and say, “Yeah, this is my complex thing that only I understand that only I can use.” Jorge: So, I'm wondering how you… Like, I would like to hear an example of how you go about designing with words. Like what are the tools that you're using? What is the process? How do you put it in front of people? How do you test it? Michael: So let's walk through an example. So going back to the example of an error message that I talked to at the beginning, if you were asked to write an error message, you could take the scenario that someone gave to you and say, “Well, here's my best effort at what that error message should be.” There's actually a story about this in the book. Someone named Lauren Lucchese, she's a design manager here in Chicago. She talks about the first time that she was asked to dive into writing some error messages for a login screen. And she was given this spreadsheet of 50 error codes and told to write something general that would work for most of the situations, if not all of them. And she started this project just trying to respond to the need that was given to her and trying to make her best effort to write the right error message. But there were a lot of different things in that spreadsheet. There were things like a code for when the user of the account, when records showed that that person was deceased, for example, or when there was a notice of fraudulent activity on their account. So, there could be all sorts of reasons that this person can't get into their account, and some of those merited some unique handling. So, while she started to just write, she realized that that wouldn't meet the needs of the users. And in fact, when some of those initial flows were tested with users, they saw that it wasn't working that well. So, what she did was she started asking questions about these different scenarios and how it would be resolved on the business side. So, for example, if there's fraudulent activity, they could give a phone number that would go directly to the fraud department, then this person could get the help they needed quickly and they wouldn't have to go through a phone tree because they already had identified the person's problem via that error code. So that's an example of how Lauren was able to identify unique needs by asking questions, by being curious. And that's applying… that's an example of applying the design mindset to this. And then when you think of testing, like the tools that you're using for this, a lot of times it's just a text editor. I use a plain text editor for my first passes when I'm designing an interface like this. We're having a conversation as a team about a new feature we want to build out, I'll offer to share my screen and start writing just in big text what we think that feature would be or what we think it will say. And getting it in front of people tends to get some really good reactions that are helpful for the team to process that. It's sort of akin to what you might get by sketching on a piece of paper what the interface might look like. Doing that same thing for the words you write, treating them not as precious, but as something to just to get out there and try to express, is a really practical way to apply design to writing. So, put three options out there that are wildly different, and see where they take you and see what conversations the team has about them. And then beyond that, I use paper a lot for testing. Testing can be pretty complex when you're dealing with a visual interface, but I find there's a lot of value in abstracting the words from an interface and testing them on the run and seeing how people respond to them. So, you can give enough of a setup that people understand the scenario that they'd be facing and then get their reaction. So, one of the methods we talk about in the book was popularized by GOV.UK, they call it the highlighter method. They print off the content just by itself outside of any sort of screen and then they ask people to highlight in green the things that work especially well, and they highlight in red the things that don't work as well. Then they're able to ask follow-up questions about why. You know, why is that working very well? Why is that? Maybe it's confusing, you know. Maybe people didn't understand the language, maybe there was jargon involved. And so that's how you actually make a case for your design decisions using words, by getting it in front of people and getting data from your users. Otherwise, you're just going to have a lot of discussions back and forth with decision-makers and say, “Well, I think it should be this way.” And they say, “I think it should be this way.” Again, that's kind of the. beauty of what a design practice brings to writing: you can start to think about it more objectively and apply some rigor to it that you wouldn't be able to if you just kept writing the way you normally do. Jorge: I can see how that is a more designerly approach to writing. I want to come back to the text editor. You said that that's a tool that you use to do this, and I'm wondering if you have a favorite text editor, and if so, why? Michael: Yeah. I've tried a lot of them. I guess it's like a hobby when you're a writer, you're just downloading text editors constantly. The one that I use as a scratch pad at work is called IA Writer, and I just like it because it gets out of the way pretty easily. You can get the type nice and big for when you're sharing your screen, and that one, it's just simple. And of course, writing the book, I used a different one: I used Ulysses for just because it was easier to organize things. And that's what I use when I'm writing on my own, just to get things down and in an organized way. So, it does nice things there. But IA writer as my favorite just scratch pad with the team, I'm sharing my screen, kind of a text editor. Jorge: Can you talk a little bit more about how you choose one versus the other? When you say scratch pad, does that imply that it's for shorter-form texts? Michael: Yeah, I mean like there's no organization, right? You're just opening individual documents, so it's easy to just open one and then they're automatically saved to a certain folder on my computer so I can just open it, open a new document, and I know it's there, saved to the cloud as soon as I open it. So that's a nice thing about it. And then there's just the simplicity. I think a big trend in those texts editors is that they're like a distraction-free environment. And that's what I look for as well. I don't want anything but the words on the screen when we're looking at it. In full screen in IA Writer, that's all you can see. It does support Markdown as well, which I'm a big fan of. I use that all the time to give hierarchy to the things that I'm working on. That's a nice thing too you can borrow from the design world because you know, there's this idea of hierarchy. How do we apply that to language as well? And that translates pretty well to Markdown. Jorge: Can you speak more, for folks who may not be familiar with Markdown? Can you tell us the elevator pitch for Markdown? Michael: Sure. Yeah. I mean, I don't know if anyone needs to be burdened with it, but… the reason I like it is because you can really easily apply some formatting without going overboard. You know? So, like, if you think of the Word document that you may have received from a coworker with all sorts of different colors and fun fonts, that's not the type of formatting I looked for. Markdown, you just put for example, a pound sign in front of a line of text, and that is your largest heading. So, if you put two pound signs, then it's one size smaller, and you can use that to break it up. In this section, you can do italics, you can do underlying, you can do bolding. But it's really minimal formatting that you can easily remove. So that's what I like about it. Jorge: When you were talking about creating variations that you would put in front of people, you used the phrase, “abstracting the words from the interface.” And I'm wondering about the relationship between this designerly way of writing and typography; the actual rendering of the letterforms and words when people encounter them. So, a resignation letter reads very differently if it's set in Times New Roman than if it's set in Comic Sans, right? Michael: Yeah. Yeah. I mean, I think that applies to like the importance of… I don't know, sometimes I worry people hear me talking about how writing is designing, and they think like, “Oh, well you don't care about the visual side of things.” That couldn't be further from the truth. I think that the best design happens when someone whose core skill is language teams up with someone who's core skill is visual design and they work together to build an experience. If you could find both those skills in one person, that's incredible as well, but that's really difficult to do. But I think that's a reason why you have to be in partnership with people. Again, like visual design is another part that dramatically affects the experience people are going to have. So, when you're abstracting from the interface, you've gotta be careful with that. You're not saying this is the final ruling on how this should be. What it does give you is, it gives users a chance to interact with the or language without being burdened by the usability issues of a form, for example. So, you can get information that you know is about the language itself. So that's what's really powerful. You don't want to use it in isolation. You don't want to over rely on a technique like that. my question is, how often do teams actually try that, right? Like how often do they actually get the message in front of people by itself so that they can understand how people in processing it?  Jorge: So, I have one final question for you, just to try to make it actionable for folks who might not be designers using writing as their day-to-day work. All of us have to communicate using language. And I was wondering if you have any tools, tips, techniques to help folks be better writers. Michael: Yeah. So, I think you could still think of writing as designing, even if you're never making it an interface. And what I mean by that is when you write something, when you write an email to a friend, take a step back before you send it. This is common and advice that, that seasoned writers will give people all the time. Take a step back, read it out loud to yourself. Think about the effect it will have on that, that person. And try to put yourself in the place of the reader as often as possible. That's, that's such a good exercise. Think about the effect that the words you have written will have on the audience. And, you can even test it too. That's another neat thing you see it happening where people will be like, they'll come up to you with something like, can you read this? Does this doesn't make sense? Apply those types of thinking to your everyday writing. And, and don't be afraid to get those other perspectives involved. I think what's beneficial about design especially, is this idea of being clear about what you want to learn. So, when you show that to someone else, don't come at it trying to answer, “Is this any good?” You know, like come at it with, “I want to see how this person perceives the way I wrote the greeting.” Or, “I want to learn more about what they think I was trying to get across here.” And make sure that you're really clear about that at every step of the way. I think it's very rare that we take a step back in our own lives and try to look at what we're trying to accomplish with the little things we write every day. Even something as simple as like an instant message to someone on Slack. I see frequently people complaining on Twitter about coworkers who just say, “Hi!” on Slack or Teams or whatever, and then wait 10 minutes for the person to respond before saying whatever they needed. So, there's this emerging idea of having some IM etiquette and saying what you want along with your greeting so that you're not wasting people's time and aren't breaking their concentration, all those things. So, you can do that just by being intentional and being thoughtful and not being so reactionary, right? Like the reason people type “Hi” and just hit send and then go away is because it's really easy. But what would happen if you started to think about the people on the other end more whenever you're writing. I think that's the, that's the direction we want to move in. Jorge: Fantastic, that is great advice. Thank you. The book is available now for preorder, right? It's Writing is Designing. Michael: Yeah. Jorge: It's available in the Rosenfeld Media website. Where can folks follow up with you other than by buying the book? Michael: Well, they could follow on Twitter, LinkedIn — I'll accept connections from people in the field. And I also have Instagram, if you're interested in photography. That's how I began this journey. I think that that side of me is a lot more fun than the writing sides. But yeah, any of those venues. I'm also trying to write a little bit more. The book got me interested in writing outside of work. So, you can follow my blog at mjmetts.com. And I write there just a lot about the methods that I use to help teams work together effectively, how I help people understand my work, and those kinds of things. Jorge: Well, great. I will include all of those in the show notes. Michael, thank you so much for being on the show. Michael: Thanks for having me. It's been great.

Aufgschnappt
Aufgschnappt Folge 12 Lesung mit Michael Well "Gerhard Polt und die anderen"

Aufgschnappt

Play Episode Listen Later Dec 4, 2019 54:20


Folge 12 ist eine Spezialausgabe: Live-Mitschnitt von der Lesung "Gerhard Polt und die anderen" von Claudia Pichler und Michael Well (Musik) in der schönen Weilachmühle in Thalhausen / Altomünster am 1. Advent. Das Buch kann man am besten bei pustet.de bestellen. Schöne Abfentszeit!

Big Gay Fiction Podcast
Ep 198: Steampunk YA Adventure with Michael Vance Gurley

Big Gay Fiction Podcast

Play Episode Listen Later Jul 22, 2019 47:07


Jeff & Will talk about their upcoming trip to New York City for the Romance Writers of America national conference and reveal the news that they will be among the presenters at the RITA Awards ceremony on Friday, July 26. Will reviews The Masterpiece by Bonnie Dee while Jeff reviews a book Bonnie co-wrote with Summer Devon called The Nobleman and the Spy. Jeff interviews Michael Vance Gurley about his new YA steampunk novel Absolute Heart (Infernal Instruments of the Dragon #1). Michael discusses the inspiration behind the story, what he did to build the world it takes place in and what he hopes for the trilogy. He also talks about what's coming up next for him. Complete shownotes for episode 198 along with a transcript of the interview are at BigGayFictionPodcast.com. Interview Transcript - Michael Vance Gurley This transcript was made possible by our community on Patreon. You can get information on how to join them at patreon.com/biggayfictionpodcast. Jeff: Welcome Michael to the podcast, or back to the podcast I should say. Michael: I'm super excited. Thanks for having me Jeff. Jeff: Yeah. We were talking before I hit the record button that we last had you on in Episode 42 and now we are at 198, it's kind of crazy. So like you did the first time we had you on, you've come up with a book that I didn't even know I needed to read when I first got to read it. So you've got this YA book called 'Absolute Heart'. It's the first book in the 'Infernal Instruments of the Dragon' series. Tell everybody what this is about, both the book and the series behind it. Michael: 'Absolute Heart' is above all else a steampunk book. It's an adventure set in a world where clockwork powered England - in 1880s Victorian era England - is at war, a sort of Cold War, when we first pick up the series, against the Magically Powered Ireland who's been kind of besieged by the Brotherhood of the mage. It's a clock. It's a warlock group that is sort of made the queen subservient to them in ways you have to find out when you read it. And it's really the story about two boys. Gavin the high councilman's son from England and his friends, following him when he has these terrible secrets - he thinks they're terrible - and when they're found out he could be executed for them, for at least one of them. So he does what all teenagers do when they have something awful happen and they think they're gonna get trouble, he runs away and his friend, his best friend Landa who's an art officer, which is a mechanic, a computer engineer and she's a powerful female character that I'm really proud of. And she has his back and challenges him and calls him foolish when he's foolish and she goes with him and some other people who have their own agendas on this quest. Then the other side, the Brotherhood, sends Orion of Oberon who is a young warlock of immense power because he's the nephew of the ailing Irish Queen. They send him off to get the most powerful weapon in the world - the dragon stones and there's a lot of mystery and history about the dragon stones and what they are and what they can actually do, but they want them to end this war in their favor. So of course they have a meet cute, or at least I hope people think it's a meet cute. They have to decide like, are they going to get together? Will they/won't they? Of course, there's the will they/won't they thing. I'm really excited about the steampunk adventure and it sets off and is set to be a trilogy so I'm really excited about that, and hopefully people will like it - the inclusion of fairies and the air steamships and all the wonder that is steampunk. Jeff: Steampunk it's so not really anything I read... I dabble in it periodically, but something about Gavin and Orion and the bad ass friend you gave Gavin. Full disclosure to the listeners, I read a very early draft of this. You have a lot going on in book one, what you've parroted back now, into a more condensed story, but how did all this coalesce and come together and what was the inspiration? Michael: You really should pat yourself on the back because your viewers should know that you read an early ARC and gave me notes, and edited, and really kind of dissected it for me - like, wherever it was messy you, like a good editor said, "That's messy." The research starts with reading steam punk books and reading a lots of YA, which is of course a terrible addiction of mine. In reading all of that steampunk and finding those characters that you like, and you want to write about - because I use Scrivener, you have the photo option to put your vision of the characters, the places, the ships - you put photos in there and I work with a split screen so I can always reference that, so I never really lose track of it. But yeah, it was great looking into all that steampunk stuff and going into like Cassandra Claire's 'Clockwork Angels' series or Scott Westerfield's 'Leviathan' series. And if I can get even a little bit of that spirit I'll be really happy. But it starts with loving steampunk. You really should write what you know and write what you love. I've never been an airship captain but I love reading about them and I love that whole idea. And you know, thinking about like 'Leviathan', that series has a powerful gender bending quality to it, with the girl because she has to, dresses like a boy and acts like a boy in order to have a career - and I love that. I hope I've engendered Landa with that a little bit as well. Jeff: What went into creating your world of magic in Ireland and steam power and clockwork in England, because there's so much that you can pull from to create the steampunk universe. What was your decision to make these things your universe? Michael: Steampunk is - one of the amazing things about it is, an amazing thing about worldbuilding as well, is you can go with historical fiction. You know, like my first book and it's wonderfully creative but you're also stuck with... you can't lie. It's historical fiction, you can make up characters and you can make up some things, but really if you get too far away from reality, people stop believing in what you're writing about with historical fiction. At least I think so. I stuck with the roaring 20s pretty well and that kind of thing. Steampunk is like a little bit to where you're in the 1880s Victorian era. But then you have these advances and you can get creative and wild and all of that. A lot of that came from traveling for me too, like I've traveled to Ireland and I kissed the Blarney Stone, which of course means I'm full of B.S. I guess, the gift gab you know. And then I went to England and I went to Stonehenge and I played around amongst all of the hinges there, because that's where they keep them, and how a lot of fun. And the idea of the magic stones and power and Irish magic and castles - and then of course the troubles with the war between Northern Ireland and England - and I just rolled that back 40 years or so, and brought all that magic and the Stones and the power, I brought all that together and that's really where the idea came from. I also wrote a comic book like 20 years ago that had a lot of the fantasy stuff in it and it never got published but I tweaked it and changed it throughout the years. You can almost say that this part of this book- the backstory, the fantasy magic side - is about 20 years in the making, which I guess makes this a labor of love. Jeff: That's very cool that it goes back quite that far. Michael: Makes me feel old saying it out loud. Jeff: You could have had the idea when you were 5 or 6. What do we have to look forward to as the as the trilogy progresses - without obviously spoiling anything necessarily - but what can you kind of hint at about the story arc? Michael: Well, you know I'm a big fan of sci-fi, and Steampunk is really an offshoot of sci-fi in a way, or vice versa I guess. But, you know 'Star Wars' originally was 'Star Wars' and then they added 'A New Hope' to the title when they were like, "Well, you know Darth Vader is still out there." I mean, you know they gave Luke and Han Solo some medals. But, you know, then you get Darth Vader out there. So I love that idea of there's always more. If you look for it, if you see the little bits, like there's actually Darth Vader and an emperor... we're still at war guys, so come back for 'Empire', and guess what, it's going to get darker and worse and that's really kind of what's happening here - the book sort of gives you an ending but - and I think so does every book [in the series]. It has an ending, but it really isn't. If you're reading it, you know there's a lot more that's about to come down, and we might lose some people along the way, and maybe find some new people that you love, who's together might not always be together. Jeff: So with everything, between the magic and the clockwork and the steam and everything, your story, your book bible for this must be huge. Michael: I used this great British author named Ellen Gregory who did some high seas adventure, and she read an early Edit 2 and gave me some criticisms - which I kept calling British-isms - and gave me some pointers in that, and we were joking about that too, that I have one hundred pages on the parts of a ship... hundreds of pages and you could just bore people to death writing about that. It's like giving that little bit to make it believable, and make it feel fantastic or whatever, and then let it go. And then I just use that incredible knowledge about mid ships and jibs at parties. I can talk about all that stuff at a party now, but you don't put too much worldbuilding in, but it is fun. I do have lots of stuff, like when I'm writing, there's fairies in the book and I did so much research about Oberon, the king of the fairies and all that history. And then my amazing editor Dawn Johnson at Dreamspinner/Harmony Ink - I mean the whole team has been amazing, and each person has challenged me. Which is really part of the deal, you have to kill your darlings right? You have to allow some of your characters to change with some of the professional feedback. And so, anyway, I was able to use that research and pull it in and I still miss stuff, and some of those editors were like, "Hey, you know the name of that person? Shouldn't it be this, for this reason historically?" I'm like, "Yep, I don't know what I was thinking." You know, And so it really takes a village, you know. Jeff: What do you hope people get out of this book? Michael: What I'm hoping to get out of it is enough people interested to get a whole trilogy out of it and to get an audio book. I really want to hear this story come alive - the swashbuckling adventure come alive. I hope people get entertainment out of it. I hope they feel empowered and maybe challenged on their beliefs a little bit, which is, you know, a lofty goal. And it sounds like hubris to say it, but I hope people read it and see the LGBTQ+ world is just like everything else. It's steeped in mystery, and history, and great characters with amazing depth, capable of heroic acts and terrible evils, and everything in between. You know, some people will write a character and be afraid to make the gay character or the trans character do something horrible, but that's wrong. They have to do everything that everyone else does in order to make it real. And so I'm hoping people will forgive me if I do something horrible to a character, or make them do something terribly wicked... you know, mustache twirling - and not, of course, hate the straight characters that do bad things as well. Jeff: Right. Now, you kept a lot of this book in your family, in some ways too, because your husband Jason Buren did the cover and interior art - and the cover is gorgeous. Michael: Thank you. I love the art. Jeff: How did he come to get involved in it an what was it like collaborating with him on those elements? Michael: Well, Jason's an amazing artist and graphic designer. We actually worked on the first one together and we worked on comic books together and what I realized through it - honestly working with Dawn and the great editors, kind of makes you realize some things - you have to back up and state your vision. Say what you want. Show covers of things you like, and things you don't like, and then not micromanage it. Because then what you're going to get is my artistry, which I'm a writer you know, not technically a graphic artist. So you really get your best work if you let the artist kind of figure it out and that's what happened. I let go of the reins of both books and I think that the covers are amazing, if I do say so myself. I think this cover is so exactly what I wanted to be, and I was unable to say it out loud. And that's what a good artist should do in the interiors too. I wanted so badly to have chapter art and I know that people don't have to let you do stuff like that, but [my publisher] Dreamspinner was so amazing. I pitched this idea of clockwork meets fantasy with the Dragon Wing and the clockwork gears together So I'm so excited to show some of that together with the dragon wings with the mixture. Anyway I'm so excited and geek about it. I even got a little gears as text breaks in the art, in the books, it's really fun. It's really gorgeous. But you, know let go and see what happens. That's the idea. Jeff: When you were here in Episode 42, we were talking about a historical m/m hockey romance called 'The Long Season'. This is a total departure. Unless you can talk about the fact that you're dealing with historical times. Had you always seen in your career switching genres so completely? Michael: You know that's a great question. I want to challenge myself to do something completely different every time. And so, like being a new writer, writing historical fiction was crazy. That's too much to take on. I said, "Well, whatever. It's a labor of love, you know?" So then for my second novel, a trilogy? Themed like science fiction? Like, "Oh you're crazy, that's too much. You're not going to handle it." And who knows what we'll see. The first one got picked up, thank you Dreamspinner and I'm super excited about it. I want to challenge myself and I love that genre. So I say, let's do something completely different. People ask me about doing a sequel of 'The Long Season'. We're doing another hockey book. You know, I'm really proud of the fact that I wrote a character, Maggie in 'The Long Season' who was Brett's best friend. Turns out Bret's best friend started off with John Paul, which I'm really proud that people want a Maggie story and I think that's amazing. Who knows when that might happen. I might do that. My grandmother certainly, when she read it before she passed away, she said it can't end here and she's right... another story. And I did all that roaring 20s research... who knows, I might go back, but I want to challenge myself to do something different. I could write another hockey book because I love it and I love the whole romance side of it and who knows. Jeff: I was thinking you need to find a way to introduce hockey into the Infernal Instruments universe. Michael: I mean, there might be some sports related in there a little bit, but like medieval hockey? That would be fun. I mean the 1880s isn't too far away from Lord Stanley, so they could theoretically run into Lord Stanley somewhere. You know that can happen. Good idea. Jeff: Do you foresee more in this universe, potentially if the if the trilogy works out and is successful? Michael: Yeah. I mean, you know, I think it's set up perfectly for a TV show. That's huge right. But I've even thought about - I have a friend who's a game designer and I even thought about... man, that would be amazing. That whole steampunk idea is a huge world and you'll see in book two, the world's even bigger than you see in book one because it's a world at war. It's a world half conquered by clockwork powered England and half conquered by magic powered Ireland. So everywhere you go France, and Germany, and Africa, and potentially the United States. Are they even the United States? It's a huge world, so the stories could go anywhere. You know I think of like, Gideon Smith books. 'Gideon Smith and the Mechanical Girl' I think the first is called. They, at some point, they end up in an airship going to the United States, and the Wild West, and Egypt, and all kinds of things. Steampunk is open. Jeff: I hope that just keeps going and expanding. So what's coming up next for you? Are you done with book two or are still writing on the trilogy ,and can you look beyond this first trilogy? What's next? Michael: Well, interestingly enough, it goes back to your last question. Books two and three, the trilogy, has a beginning, middle, and end in my head. Of course there could be more after that, much like 'The Long Season', but in my mind I've already started about halfway through writing a third completely different genre book, challenging myself with something completely different, which is a contemporary YA book built on my travels to Antarctica. So it's a YA, two young people who meet and fall in love on a cruise to Antarctica. Sort of a travelog and what happens, and the interesting things, and people, and penguins that they see. I won't give away too much, meaning - that's what I'm in the middle of now. Jeff: That's exciting. A little something new there. Again, totally disparate, but you mentioned what you want to keep mixing it up. Michael: So yeah. And we'll see how that works out. I'm working with a gender nonconforming character, which is really new for me, it's taken lots of research to get intersectionality in the forefront of the book, you know not as a ploy, but as a reality of the world that we live in, and people that need representation. So I'm really excited about that. Jeff: Hurry up and write that please. Michael: All right. Hopefully, if you're willing, you'll probably see it before anybody else as a proofreader. Jeff: What's the best way for folks to keep up with you online, to keep up is as 'Infernal Instruments' continues and this new contemporary book starts to take shape? Michael: If they go to my full name - MichaelVanceGurley.com. Go on there and there'll be links to my two book sites and to my Instagram, they can go to Captain Rhetoric on Instagram and find me, that's where I write self-involved book reviews where hopefully people care about what I think about these amazing books that I read, and travel pictures, and just little bits like that, not too much of me, just sort of what I see about the world. I like to do that on Instagram and that's the best way to keep up with me. Jeff: Well I wish you the best of success with 'Absolute Heart'. It's been great to talk to you a little bit about it. And when that contemporary is done you'll have to come on back. Book Reviews Here's the text of this week's book reviews: The Masterpiece by Bonnie Dee. Reviewed by Will.The Masterpiece by Bonnie Dee is a makeover story with Pygmalionthemes in a historical setting. Essentially, an irresistible gay version of My Fair Lady. The story centers on a guy named Arthur. He is the well-to-do gentleman in this particular scenario and, one day, he's out enjoying the good life with his bestie, a guy named Granville. Occasionally Arthur calls Granville, “Granny” and it totally cracked me up. Granville believes very heavily in the British class system. Arthur is a little more modern in views. He feels that if a man has the wherewithal and can pull himself up by his bootstraps, he can achieve anything with his life, no matter where he was born on the ladder of social hierarchy. In order to prove their different theories, they set a wager, and that bet involves Joe the shoeshine boy. Arthur must make Joe a gentleman in six weeks. It is there that he will make his debut at the biggest party of the social season. Joe moves in with Arthur who is very glad that to realize that Joe is not only very smart and very kind, he is hardworking and interested in bettering himself. Joe is undertaking this particular makeover because he has dreams of owning his own men's shop one day - with a focus on finely crafted shoes. They get down to work and, after spending several days studying and learning which fork to use, they decide to get some fresh air. So they go for a constitutional in the park where they unfortunately run into Granville, who's like escorting some demure young ladies. Joe does very in his first unexpected like test. Arthur and Joe now realize that they have definite feelings for one another. Their next test comes during an evening at the theater where they unfortunately run into Granville yet again (this dude's everywhere). Granville has befriended a professor of linguistics, and Arthur knows that Granville is only befriending this schlub because he plans on bringing the linguist to the party to expose Joe as some sort of lower-class fraud. Joe handles the situation admirably. He's proving himself time and time again, but Granny is not going to give up. He makes sure that Arthur's family is invited to the big soiree, and his family comes to stay, making it nearly impossible to have any alone time with Joe. Finally, the big evening arrives and everything goes swimmingly. Joe is tested but everyone is really charmed and quite taken by him. When it comes to Pygmalionstories there is usually a point in the narrative where the Eliza Doolittle character has to wonder if the professor is in love with her, or the person that she's pretending to be. We kind of skip over that in this particular story because it's really obvious that Arthur and Joe are like completely into one another. What ends up happening is that Joe feels guilty, his conscious getting the better of him. All these lords and ladies and debutantes are remarkably kind to him, and he feels genuinely bad that he's pulling the wool over their eyes. That guilt eventually leads him to leave Arthur's house sooner, rather than later. Arthur and Joe try to figure out how can they make their relationship work, but they can’t. Even though they've essentially won the bet and they've proven their point, the fact is that the class system is still very much a thing and the two of them are from two different worlds. Joe packs his bags and leaves and Arthur ends up going to India. He has been convinced by his brother and his father that he has to finally grow up and take part in the family business. While he's away, Joe uses the money that he earns from the bet and opens his own shop. When Arthur finally arrives back in England, there's a big declaration of love scene because they realize they are both utterly and completely miserable without one another. And they both vow to find some way that they're going to make it work. I really, really loved this book an awful lot. I loved these two characters that Bonnie Dee created I was rooting for them the entire time. The Nobleman and the Spy by Bonnie Dee & Summer Devon. Reviewed by Jeff & Will.Jeff: Bonnie and Summer are both new to me authors. The Nobleman and the Spy, which I would call a second-chance romantic suspense historical, was a complete delight full of intrigue and some steaming hot sex. Solider-turned-British spy Jonathan Reese is assigned to keep watch over German Karl von Binder. Jonathan knows Karl all too well because during the war Karl spared Jonathan’s life. It doesn’t take much for Jonathan to lose focus on his mission and pay attention to the man who has come back into his life. He’s also aware that he cares too much for Karl to allow anything to happen to him, despite the fact that his orders as the mission begins are a bit mixed if he should allow the man to be killed or not. Karl, despite the forbidden attraction to Jonathan, tries to keep the spy at length, sure that he can protect himself. As evidence piles up though that there’s someone on Karl’s trail, the two end up working together trying to figure out who’s behind it. It’s a tangled web that I didn’t quite believe even as it was all falling into place. The resolution was certainly something I’d never anticipated as I tried to solve it as I read along. It was quite a thrill. I loved the feel of this book. In often reminded me of a childhood favorite TV show, Wild Wild West, which was set in the same time period of the mid 1860s. While this isn’t set in the American west with some strange characters as villains, the time period comes through loud and clear in a rich setting and how the characters carry themselves. I also liked how Karl and Jonathan recognized that they couldn't give in to their attraction but the more they couldn't give into it the more they really want to. And then when they got together it was so intense. Narrator Todd Scott I have to say does a terrific job with the entire story but the sex scenes…off the charts! Will: What really struck me and what I enjoyed the most is that it's essentially a bodyguard trope and it has all the different things that go along with that but in a historical setting. So it was sexy and it was fun and there's lots of adventure and action. I really enjoyed this one as well. Jeff: Calling out the bodyguard trope is really appropriate. But what makes it a little different, at least to me, is that Karl doesn't really want to be guarded. But Jonathan certainly takes that role because he keeps reinserting himself even where he's taken off the case. He wants to keep Karl safe at all costs. So, yes, we both highly recommend The Nobleman and the Spy by Bonnie Dee and Summer Devon.

#DoorGrowShow - Property Management Growth
DGS 78: Automating Property Showings with Michael Sanz of Neesh Property

#DoorGrowShow - Property Management Growth

Play Episode Listen Later May 14, 2019 59:36


Are you sure your kitchen table or big-screen TV will fit? If you’re interested in renting or buying a specific property, there’s a few steps to take before actually visiting it. Watch a virtual tour video and get pre-qualified. Today, I am talking with Michael Sanz of Neesh Property, which started in 2009 and has more than 650 doors. We discuss the benefits of automating property showings, including the opportunity to spend more time with people and to travel. Who wouldn’t want to operate a property management business from beaches around the world? You’ll Learn... [02:25] Purpose of Neesh Property: Holistic real estate that helps people buy, sell, rent, and arrange financing. [03:20] Same Startup Suffering: Michael struggled to start a business, grow new doors, and retain customers. [03:37] Identify and Prevent Problems: Michael controls and protects his business and simplifies his life through systemization and automation. [05:45] Workforce Reduction: Michael went from 18 to 1½ staff members and replaced them with property management software to save money. [07:58] Eliminate Office Space: Doesn’t affect how you do business. [09:43] Competitive Advantage: Neesh Property closes deals and acquires new business by leasing properties quickly. [10:30] Retain Relationships: Be client-focused, not location-focused when managing properties. [12:40] Learn from Mistakes: Try and implement new things, which may or may not work completely; pivot when necessary. [14:29] What’s the problem? Any problem, big or small, should be documented and automated to disappear. [16:10] Build Knowledge Base: Take time to make “how-to, what to do...” videos, recordings, and other visuals to help people understand processes/procedures. [21:05] Leverage People as Process: Create core team of people who are thinkers and decision-makers. [27:38] Virtual Tour Stats: Neesh Property gets over 85% of its real estate booked based on the virtual platform and averages 1.8 showings per property. [31:05] Good Tenants Gone Bad: Rather than giving best to the bad, give it to the best of everyone; mesh type of tenant to property. [50:55] Common Beginner Pitfall: You don’t need to be cheaper than everybody else to get started and compete; change your value proposition. Tweetables Save Money: Replace staff members with property management software. Be client-focused, not location-focused. Meaningful Connections/Conversations: The rest just falls into place; it’s all systems. Automation offers the opportunity to simplify your life and spend more time with people. Resources Neesh Property Michael Sanz on Facebook Ricoh 360 Camera Matterport: 3D Camera and Virtual Tour Platform Vieweet Skype Zoom Housecraft GatherKudos Oculus Rift DoorGrowClub Facebook Group DoorGrowLive Transcript Jason: Welcome, DoorGrow hackers to the DoorGrow Show. If you are a property management entrepreneur that wants to add doors, make a difference, increase revenue, help others, impact lives, and you are interested in growing your business and life, and you are open to doing things a bit differently, then you are a DoorGrow hacker. DoorGrow hackers love the opportunities, daily variety, unique challenges, and freedom that property management brings. Many in real estate think you’re crazy for doing it, you think they’re crazy for not, because you realize that property management is the ultimate high-trust gateway to real estate deals, relationships, and residual income. At DoorGrow, we are on a mission to transform property management businesses and their owners. We want to transform the industry, eliminate the BS, build awareness, change perception, expand the market, and help the best property management entrepreneurs win. I’m your host, property management growth expert, Jason Hull, the founder and CEO of DoorGrow. Now, let’s get into the show. I am welcoming all the way from across the pond or even further maybe, Michael Sanz of Neesh Property Management. Michael, welcome to the show. Michael: Thank you very much for having me. Jason: I’m excited to have you. You’re a really cool guy. I got to connect with you in the past in person, which was great to meet you in person, and you’ve done some really cool things. But before we get into some of that, and today’s topic for those listening, is automating property showings. We’re going to be talking about that. But before we get into that, why don’t you give people a little bit of background on you and let everyone know why I think you’re so awesome. Michael: Thanks for the introduction and thanks for having me at the conference in Missouri last year. It was amazing. Perfect. As Jason said, I’m Michael Sanz. I am from Australia, from Melbourne, and I have a company called Neesh Property Residential that has been going since 2009, has over 650 doors. I started how everybody else started out in real estate and started from zero, or how much people started, started from zero doors. I had a new relationship started at the time. Add the pressure and the stress of a new relationship coming into a new business, setting all that up. I started from the study nook in an apartment that I had. I had left a previous business. It was quite a successful business. Left the partnership at the time and I started Neesh Property. What was Neesh Property to me? It was a holistic real estate that help people buy property, sell property, rent property, and arrange the finance. It’s holistic all under one roof. I had suffered the same problems everybody else has suffered from starting a business, trying to grow new doors, I guess retain business when people sell their properties or go to other agencies. I spent a lot of time methodically going through all the pros and cons of a property management business and I really started to systemize it, automate it, and not let the business control me from an early point, but how I could control my real estate business and what protections I could put in place to make sure that I could do some hyper growth, retain the customers that I had, and simplify life. A lot of people that know me would have say that I will operate Neesh Property from many beaches around the world. I would close down the company every Christmas time for two months. In real estate, people say, “That’s unheard of. What about maintenance? What about all the problems?” But I identified all these problems and I’ve been out of able to do a lot of travel, and I’ve spend a lot of family time while automating the business. Jason, as you’re talking about today, automating how I show properties and really break down that process meant that I could be in Missouri and show people property before I went on stage, after I went on stage, and successfully lease property without really having to do anything at all. Jason: This is wild. I think everybody listening goes, “Michael’s some sort of crazy, weird robot. This is some magical impossible thing. Nobody else can do this.” You’re maybe some sort of savant or guru. But you started your business and from the beginning had this intention of systemizing things and keeping things off your plate to keep that space, and some people, their intentions and focus is very different. They build a business that’s very difficult to manage and to run. Paint a picture. You’ve got 650 doors right now, I think you’ve said, right? Michael: I just sold a bulk of that and I’ve got Neesh Property. I’ve automated even more with a new portfolio, but that’s for a whole other conversation. Jason: Help people understand your business logistically. How many team members do you have? I think this is where it really showcases how different your business is than most companies that are at a similar size. Michael: Sure. At a point with the business, we had about 18 staff members. We had acquired another smaller business, and we acquired their team, and we had an office. A lot of which goes against the grain having office to me. But when I acquired another business, I took the office and it had a receptionist, it had a business development person, it had an account, they had all these people there. I couldn’t see, with total respect to their role, I couldn’t see the purpose of it, so I knocked them down from 18 down to 1½ staff members. One full-time property manager and one part-time who did routines and edit some showings as required. Jason: Wait. So, you went from 18, bring on another company, and then you whittled that down to 1½ team members. Michael: Yeah, correct. I couldn’t see the massive need to have all these people doing accounts when a lot of the property management software already did all the reconciliation. I was just having a bum on a seat to press a button to reconcile. I couldn’t see the purpose of having a receptionist when there are people there who could answer the phone, so we put in a good IVR, a good voicemail system, and we educated. We identified that a lot of the calls that were coming in were from tenants either trying to report maintenance or [...] it was. Then we put in automated responses there, too, and if there’s any business call, “Press one if you’re a landlord, press two if it’s new business,” and then it would come through to my cell where I could answer and respond to it quite fast. Identifying the flow of calls, the type of calls that are coming through the office meant I no longer had to have a receptionist there. In Australia, the wages are quite high. We’d be paying someone $50,000–$60,000 to sit at a front desk, to greet people if they came in. We have also identified that as property change, people will less and less likely to come to an office. Tenants wouldn’t necessarily walk into the office and let’s say they did walk into the office, we would be there to greet them but no one was really walking in. Owners rarely walk into an office anymore because they could call you, they could video call you. We ended up getting rid of the office. We have spent from a big 250 square meter office place to a two-bedroom apartment, and guess what? It didn’t affect how we did business, didn’t affect us picking up new business, didn’t affect us losing any business, and the world still spins. It’s not chaos. For us identifying all these headaches we’re able to see what mattered. If the team couldn’t adapt to technology changes, video, virtual reality, automated IVR systems, and things like that, then there wasn’t really a place in the business for them, respectfully. I actually have one property manager leave to go with a company where they still did paper condition reports because that’s how she wanted to do them. Jason: Right. You’re welcome to it. That’s so funny. Okay, so this will make a lot of sense and I think you and I have both significant, nerdy, technological side to us. This stuff sounds obvious to me and maybe obvious to you, some people listening maybe not so obvious. If they have all these questions, “How would I do this? I would I do that?” It’s scary. But if you make that your intention and your goal, you’ll figure it out just like you figured out whatever you’re doing now. One of your big competitive advantages now in closing deals and in acquiring new business is your ability to lease properties so rapidly. Paint this picture of how rapidly and how different your leasing process is, just to prime the pump here. Michael: To put it into another perspective—I know we touched on it previously—we were full suburbs. We manage properties in over 84 suburbs and we also have properties in two other states, which was Sydney and New South Wales in WA. WA is a four-hour plane ride and Sydney is 1½-hour plane ride from us. Now, we weren’t insane, crazy totally. We only manage properties of the clients that we actually had on our book and we did that so that we could retain the relationship with them and we would appoint other local agents to help with open inspections or routine inspections, or things like that. And because I’m a frequent traveler, when I was in the area, I would pop in, say good day to the tenants, and just touch face that way, so the owners knew that they are getting full kind of service. In Victoria, it is very much managed by our office and again, we are client-focused and not location-focused, which was one of our main selling points and is quite attractive to landlords that we had. Because we also offered mortgage brokering, we really didn’t do too many sales, we were mainly property management and then we offered mortgage brokering we saw the value in that. If it was [...] other agents that could help us do the menial tasks. It wasn’t a headache for us, we didn’t stress about it, but we covered a lot of space. You can imagine when properties come up for rent. It’s cyclical because people [...] properties around at Christmas time, they go home to their families and their friends. We would have sometimes 10%–15% of the book would start to come up for rent and you can imagine the franticness of trying to get out all the inspections, deal with tenants, vacates, and all those headaches that came with it. Now, it’s probably 11 where I started [...] this. This wouldn’t be a problem with the spread of properties. As I sat down, I started writing down all the problems that I could have. Petrol, time on the road, who am I going to have, how many staff members I need to to do this if I’m going to have potential growth? How do I automate this? That was the biggest thing. How do I automate this? What if it’s Christmas time and I want to go away on holiday? What am I going to do? The selfishness in me also came out because I still wanted to live and being an owner-operator. What would you do? I identified with myself that if I made mistakes, that was okay because being a business owner, if we don’t try and implement the things we’re looking, that ain’t worth. But it doesn’t mean that it’s not going to work in its entirety. It might mean that you just need to pivot a little bit and change what you’ve been doing to give another go. I had to automate the whole thing and I started the journey. Jason: I’m hearing a process here and I think you’ve mentioned this twice now. For those listening, you may have caught on this but it sounds like you have this mental process that you go through probably constantly where you list out potential problems, and then you sit down and figure out what are the solutions, and then you have this intention throughout that whole process of, “How can I have vacations? How can I make sure that I don’t have to always be doing it?” Which is a very different mindset than most ppl have. They’re just figuring out, “How to do I keep the business running? How do I make sure that we don’t drop the ball?” And you’re like, “No. How can I,” as you put it, “take Christmas and not have to work? How can I go on holiday and not have to do this, and it would still work?” That’s a different problem to solve. As entrepreneurs, we’re great at solving problems. But if we don’t give ourselves the right problem to work on, our subconscious isn’t going to work on it, our brains are not going to work on it, we’re not going to find those solutions. We stop prematurely at something superficial and that’s a whole level of depth to go beyond just making sure things work, it’s making sure things work without you. Maybe just describe that. What do you actually do? Do you just pull out a piece of paper and you write all the problems? Michael: A big point when I had staff in the office is that if anyone reported any type of problem, big or small, it had to be written down. If an owner said, for example, “I can’t reach you on your mobile phone.” Or, “I don’t understand the statement,” just general questions. If someone doesn’t understand the statement, what we did was we recorded what the landlord income statement meant. “This is your name, this is the date and everything.” We do a video. We do a screenshare/screengrab video and in that was a link. If anyone asks anything about statement, it was there for them. It was in one of our FAQs. People could see it. All of a sudden, we didn’t get all these calls. We worked out any problem in the business. Someone turned out in our office at 7:00 in the morning and said, “Why aren’t you open?” We address those things, we have better signage on the front door, and then all of a sudden, all these problems that a business would have were just disappearing and it was automated. By using video, by using written text, by having window displays, just simple things, the business became automated. So much so that religiously we close before Christmas and we open up towards the end of January, so that everyone gets time off to spend time with their family. Jason: And everyone being your 1½ team members. Michael: When I had a lot of team members, they were loving it big time. If people want to go on holiday, they can go on holiday because the business can run. Jason: All right, so this is really cool. Basically, what you’re talking about is you built a knowledge base of frequently asked questions and leveraged video screen shares, recordings, showing them how to do things so they visually could see, hear, and understand what needed to happen. As they would go through these and have these questions, or you send them a link to this frequently asked questions or in your knowledge base, or you send them this video, they would watch this video. The magic of video is they would feel like you’re right there, walking them through it, tell them, they’d hear you, see you, they feel like you’re taking care of them, and you’re not even there. You did it one time and now, it can be used for 650 different people or however many clients ;that you have. They can go through it multiple times instead of just once because they may not remember. But they’ll remember, “Oh, there’s this thing I can go to to get it.” Michael: Correct. A lot of the agents who I would speak to is on video. I don’t have to speak to video where it takes time, I don’t have enough time. A lot of the videos early on that I did [...] showing or like a routine inspection or open for inspection. I would just have the camera on a tripod and while I was waiting for people to come, I would do a video. “I’m at this property here. Look at this one,” or, “This is a leaking tap. This is how we address it. This is what we do.” Just small videos and I just built up content. I had the tenants any problems, what to do if it’s raining. What to do if your hot water service breaks. What to do if your dog runs out to your next door neighbor. Just simple things I turned into a video so I didn’t have to answer again and again. Again, this is like I’ve touched on before when people could call up and they address the problem or an issue or concern, we try to turn that into a video so that it was answered once, solved 100 times. Jason: The trick is that if you’re going to have to answer ever, once, take note of it, then put it on your to-do list to make a video so you don’t ever have to answer that again. Michael: Yeah. I think as business owners we need to give ourselves the emotional permission today to take the time, even if takes us half an hour to do it, so we bank up future time. That task is going to take us a 30-minute phone call or whatever it is, we spend 30 minutes recording it now, and you’re going to have that conversation a hundred times, you just saved yourself 50 future hours and you could be doing other things. Jason: Absolutely. We have done the same thing with clients who go through our program. I used to coach them all directly, but shifting it into video content allowed me to make sure that I said the same thing and got the best information to each client, and it allowed them to watch it more than once. My memory is not so amazing that I could remember every single thing I’ve said to every single clients about every single topic and not miss something. But I could put it into content. If I get a bunch of questions, I can add more content. I think some people would say, “Jason,” or, “Michael, you guys are really lazy.” I think there’s brilliance in that. I wouldn’t call it laziness; I would call it, we don’t like doing stupid stuff over and over. I mean, really simply, and that’s really frustrating to have to do redundant work. But some people, they love that. They would just do the same thing everyday. They love doing that. That’s not me. I would guess that that’s not really you, either. You like being able to have freedom and not have to answer the same questions over and over and over again. Michael: That’s the definition of insanity, isn’t it? Doing the same thing over and over again, getting the same result. I can’t understand doing the same thing over and over. I guess as business owners, we also get caught up in the really small things, and those small things we think become really important but they’re not. I’ve got some VAs that do the really menial, small tasks that I don’t even have to think about. Things that our software doesn’t do that a VA would do. Get out of that mindset that you have to do these really small things because it’s not important and when we identified that owners and tenants just want to get that problem resolved. If it needs to get escalated, then yeah of course, take it on. But the small things, they don’t really care who answers, it’s fine. As long as it’s clear, their problem is solved, they can walk away happy, then they’re good. Don’t stress. Jason: So, part of this automation, you’re leveraging technology, you’re leveraging video, you’re leveraging a database or knowledge base of frequently asked questions but also, you are leveraging people as process. You’re bringing people almost in a position of almost operating software in some instances. And then you have a core team of people that actually are thinkers and decision-makers that’s really small based on what you said. Let’s get into then the topic at hand, which is automating property showing. How can those listening start to move towards automating property showings and what are the benefits you’ve seen by doing that? Let’s get them excited about the why they should do this first. Michael: As a business owner, having staff members and having multiple properties that would come out open for inspection and also understanding that tenants are really demanding, they want to see the property, they would call you up and say, “Is it open now? Is somebody there now? Can I go now?” And then having a staff member get in the car, drive half an hour listening to music, speaking to their family and friends, doing whatever they want to do in the car, get to the property, wait for the tenant to turn up, show them the property, have them say, “Oh, yeah. It’s nice. The walls really look like they did in the photos.” Whatever it is, or they love it and again they’ll buy for it. “Can you wait for my friend to turn up? My partner’s on their way.” All these headaches. They do the inspection and then they spend another half an hour driving back or getting lunch on the way, or however long it is. One time, okay, but if you replicate that, you’ve got 8, or 10, or 15 properties for rent at that time, that’s a headache for any company because of all these inefficiencies on the road. I identified, “Okay. Well, what do we do?” My wife was working for a ticketing and event company based in San Diego. She was running it from Australia, it’s the operations. We’re in San Diego one time, I had this massive 3D 360 camera. I was going through all the theaters and from every seat there would be a 360 [...] so that people, when they go to buy a ticket, they could see their exact view of how they’re going to see the stage. I was like, “Hang on. Why can’t I do this in real estate? What’s stopping me from doing [...]? This is so simple.” The camera was huge. It was massive at the time. Even three months later, I couldn’t find an actual camera to do it. What I was doing was going to the room and taking 100 shots everywhere and then stitching it together. For one image it was taking way too long. At Christmas time, I was in London, closed the business down, before virtual reality [...]. It can be done. I was walking up the high street in London and I just thought, “I need to find something simple, cheap, to get the job done, and save me more time.” I just went on the phone, I looked at my phone, and I found a local supplier that had the Ricoh 360 camera. It has just been released. I went out and picked it up, and from that point in time, everything I did for real estate, for property had a 360 video. And went then into step two, and I made sure that all the rental properties had a normal video, just with a smartphone or SLR. From that moment on, when I brought the 360 camera, I really hit all our properties hard. Before I go with 360 virtual reality and video, a lot of people that I speak to, they go out and buy the camera, they’ll do one tour which generally happens after the tenant has vacated and they’ve already had marketing for 4–6 weeks, they’ll do the tour and they’ll say, “You know what? Michael, I tried that. It’s not for me. Didn’t help me get a tenant. It was no good.” That’s the biggest feedback I had. That’s cool. That’s fine. But for me, I want to persevere. I made sure that every single property we came up for rent, had a 360 virtual tour. Also in the start, it didn’t help with every single property because I had marketed without photos for four weeks prior, and I was able to find tenants thereabouts, most often than not. With the 360 virtual tours, it was the next time that it came up for rent. A tenant would give me notice to vacate. The day they gave me notice to vacate, the virtual tour went up on all the real estate platforms that are out there. We have the video and we have our photos which are okay. They’re good, they’re okay. But from day one, people could start to see the property without me having to worry about booking an open for inspection and the condition of the property is all boxed up, or the whole family’s home or whatever excuse the tenant was, people could start to see the property. That started to change things. Just to reiterate, if you’re starting off, you have a property that’s coming up for rent, the tenant’s moving out, you can do the 360 tour afterwards. You may not get the hyper result that you’re expecting. Don’t stress. Replicate it on every single property you’ve got and you will start to see massive change from the next time it’s for rent and every time after that. Don’t stress. Give it time. People fail because they give up straight away. Jason: And then each new door that you’re getting on, you’re going to do the virtual tour at the beginning so you’ll have that moving forward. Michael: Correct. I got to the point where if a tenant gave notice to vacate, I went in there, and I do the 360 tour with all the furniture in there as it was. I didn’t put that on publicly but I was able to show people with the tenant’s permission, just give them a link, and remove the link after they see it afterwards. I wouldn’t get it publicly on the real estate platforms but I would have the tour and I would give it to people. That changed everything, too. Tenants were okay with that because you can edit the 360 images to blur out photos in the wall and things like that. That was pretty good. I also just did on the iPhone walk-through videos that I could also comment on. I would take just photos, too. We had over 85% of our real estate booked on virtual platform. Can you imagine, Jason, having 85% of your business, that people can view the property without you having to worry about putting a lot box on, be physically attending the property, and having the issue of staff or even yourself going to have to show that property multiple times? To touch on that, we were averaging at 1.8 showings per property and I’ve got to cancel one showing per property on average. Jason: No kidding. Michael: Huge time savings. If you were to quantify that and you’re breaking out 15 properties a month, let’s say, that’s like $150,000 saving in a year, of time and profit based on our letting fees. Our letting fees are small than American letting fees. It’d be significantly higher in America but for us, it’s about $150,000 just the base saving in 15 properties a month. Jason: Oh, yeah. So, the cost savings compared to the cost of getting the digital cameras and maybe the little bit of work and labor that would take to get these virtual tours done and everything, it was an obvious no brainer, financially. Michael: Obviously, yeah. For me at the start, I would have spent a couple of thousand dollars, maybe more, trying to really solve it. I have a lot of cameras now, a lot of VR, a lot of 360 cameras, and I’m still using the same one that I bought years ago which was the Ricoh. But I’m trying to find the next camera that gives me more depth immersion like the Matterport but something that fits in my pocket. So, for me to do it, if it does not fit in my pocket, I’m not going to take it with me. The Ricoh fits in the pocket. I think it’s $170 or something like that on Amazon. A tripod is $30 or $40 on Amazon. To host 22 platforms of the year is $20. The platform that I use is Vieweet It’s one of the cheapest one out there. It’s robust, it’s simple, it’s no frills. If you’re an agency, you’re just starting out, and you’re looking for cheap ways to do 360 automated showings, $130 for the camera, $30 for the tripod, $20 a year to list 20 showings that you can put up and take down. A lot of people don’t have more than 20 properties available all at once. Jason: It's called Vieweet? Michael: Yes. If you're in $200-$250 US, you can be up and running today to do these things. But just remember, you may not get that sprinkled dust straight away. It’s something where you build that new catalog that does work. Results have been quite fast because I kept at it and you will, I can’t say, you'll get the same if not similar results that I was getting because what it all sold for us—that’s just kind of the odd part of things, Jason. Our property to more people around the world in different that [...] the property. Rather than having to rely on people to come into a lock box or view the property physically, they may not have been the best quality tenant. Rather than giving the best to the bad bunch, we’re able to give it to the best of everyone. Anyone who wants to see it within the markets to high-end income, at least they could go to relocation consultants that were actually being paid by people to come into the country to show them properties. We were showing it to the people before they go to relocation agencies in the end. If they will apply, they would inquire, “Hi, Michael. I'm actually relocating from America or Europe. I'll be there next month, try to arrange a viewing.” I’ll send in the link. They view the property. They don’t need to worry about looking at 10 properties when they get here. We can do the process, we can get them out of Skype or Zoom. At the end of the day, good tenants can go bad. Make sure you get landlord insurance if you can get that. We were so efficient with what we did and that’s probably for another conversation, but we got rent arrears to 0%. Not only will we have to get the best tenants in the marketplace, we get the best tenants that could afford to pay rent and not have any arrears and it solved a massive problem for us too. We are probably at about I think 3½ of rent arrears sometimes because people, they’re just lazy. By changing the type of tenants that we had, also made all the knock on effects that we had so that our arrears is 0% vacancy because we’re able to work credibly with our leases to make sure that longer leases we had better type of tenants. We’re also able to mesh the type of tenants to the property. For example, if we have an application that was someone 50 years plus as opposed to 18-25 year olds. An 18-25 year old would be more transient and they wouldn’t stay on the property for a long period of time, maybe 12 months. But someone who’s older is typically settling down, they don’t want to be moving around everywhere. We have a bit of a tenant selection too. Jason: I realized it might be a little different in Australia than here though. Michael: Well, what we did inside the office, we can verbalize it to the people that apply. Jason: Got it. Michael: No one from Australia is watching this, yeah? No tenants that I had. Jason: Right. This all makes a lot of sense. You have 0% vacancy rate. You’re renting out some of these places before they're even vacant because you're marketing them from the second there's a notice. You're getting people out of state or out of country that are able to look at it. I think it’s brilliant that you've got partnerships you've created in alignment with relocation agencies and relocation agents. I think that's sharp. All of this sounds really fascinating and this is something that anybody can do. Michael: Anyone can do it. Even like staff members. You’ve got people who work for bosses, there's no reason why [...] to help automate your showing. If a virtual tour or a video, or someone contact you at 10:00 o’clock at night and you're this type of person that picks up the phone at 10:00 o’clock and tries to make a time, you can send them link that’ll pre-qualify them. The good thing about UVR, it shows you the room, the whole room. They can be looking at the whole kitchen. They can be looking at the whole bathroom for so many times you go online and you just see a corner of the bathroom which shows the tiles, the toilet, the shower, and the bath. It eradicates all of that, it’s gone. I think I showed you too, when we got to the actual property, the other headache was, I'm not sure if my table would fit, or the fridge might fit in the cavity so then we included an incorporated AR, so the augmented reality which was just another boat. With the AR, you can record the screen, so you can be at the property while it’s taken and actually do a video recording of, “This is where your catch goes. This is where the fridge goes, and the TV goes,” and put the furniture down. Then you can send that video to people too when they inquire about, “Will it fit a king sofa bed, or what size is the fridge cavity?” Because people are visual, mostly. Jason: How are you doing that? How are you putting in beds, virtual beds and things like this into a video? Michael: The app that I use is a free app. I love this stuff. It isn’t going to cost anyone here. Housecraft. Now that’s free augmented reality application. Jason: Housecraft, it sounds like witchcraft, it’s like magic. Housecraft, okay. Michael: It is magic. Again, I have all these tools because they're objection handlers. I don't need to over complicate things because then it just starts making problems. These are free things that anyone can be using. Anyone can do anything that I've been doing. None of it is hard. It’s just I have a better use of my time. Jason: Yeah. You’re using Housecraft, you're using Vieweet, you’ve got your Ricoh camera, are there any other technological tools that help you automate the showing thing? Michael: Basically, how it would work for us was a tenant will give notice to vacate or we would have a brand new property come on. We would have the tour or take the tour. We would put that as a link on a description. A lot of the feedback I had from people around the world was, our property software, our showing software doesn't allow us to put a hyperlink in there. We just put it in the ads, we put it in the ad there too. We had every second photo for us was, “Did you know this property is in virtual reality? Make sure you click on the link in the description.” When people are looking on their smart device, because most people are probably looking ad property searches from their mobiles, it’s important that we could grab their attention with a nice bit of photo, grab their attention saying, “Hey, we've got a virtual tour, or a video, make sure you look at it and prequalify.” Rather than coming to the property and saying it’s for them. If someone did call and inquire the questions was, “Great. Have you seen the virtual tour?” If it was no, it’s like, “Okay, here’s the virtual tour,” and they all had to see it. We would not go to a property unless the person had seen the virtual tour. Jason: Right. Virtual tour first and then if you've watched that and it's still a go, then we will show you the property. Michael: Correct. When we did that, when we went to the property, we knew that it was really just a case of them checking if there's a smell, just their general feel, their juju. It was basically they’re going to apply for the property. Typically, if I went to the property, there's a 93% chance they got the property, and it was 96% that they would apply or they’d rent the property. Jason: Because the virtual tours have filtered out so much. Michael: Prequalified. Jason: Now, in the photos where you doing stuff like box brownie and like this kind of stuff or are we just getting photos? Michael: We change it to make sure that the header photo, the main photo in this sort of style—we’d have a blue sky, green grass—it was just a nice attractive image so that people would click on that, like a clickbait basically. It'll look nice, they click on it, and then the next image was the virtual tour. They knew that there was a virtual tour there and then there are the other photos. They were the only photos that were relevant like the way you actually see the room. If you couldn’t see the room or it was cut off, we wouldn’t show it, because the virtual tour was going to show the property in its entirety. This just meant that I would not put 20 photos up of a half-baked house when I can put three photos up, a virtual tour video, and a walkthrough video—far greater impact. That’s why we’re leasing properties four times faster than our competitors, and we were getting more than double the amount of views on all our properties according to realestate.com.au which is a massive property platform in Australia. What we were doing was, no major cost difference to competitors, but we were getting twice the people looking at our property, and four times faster with being leased. Jason: Michael, this sounds really incredible. Having all these stuff in place, it sounds really low cost, and it sounds like it actually saves you a ton of time, and a ton of money to get these things implemented. Now, what I love to do is connect this to how is this helping you grow your business. Obviously, it’s reducing cost, it's reducing staff, but this sounds like a huge competitive advantage selling point when you're pitching to new owners to say, “We have zero vacancy rate. We’re managing hundreds of properties…” which is unheard of in our industry, “…and we can we can get this thing taken care of and lease it out really rapidly. I've got the cameras on me, I'm ready to go. Let’s do this.” Michael: Correct. There’s a lot of white noise and noise generally in property management. When you're going to a listing presentation, it runs based on the same topics. “We collect rent. We have low vacancy. We are fantastic. We have good systems.” You can basically walk into a presentation and know verbatim what people are going to saying. If somebody inquired about renting out a property, they will get an email from me with our reviews, true statements, and things that we do differently. When I would go to the appraisal, I wouldn't actually bring anything other than a set of virtual reality goggles. For me, I didn’t go in with a booklet. Everyone kind of expects you to walk in with a booklet and pamphlet like all your competitors do. But me, it’s straight away, “Let's work on that trust that rapport with the owner.” I would walk into the presentation, I put the virtual goggles down the table which is a gimmick, they're a gimmick, and then I put them on the table and then I say, “Mr. and Mrs. Landlord, so tell me, what do you love about your property? What are the tenants going to love about the property? What would you do differently to the property that tenants might also think that they wouldn’t want changed?” I get them speaking about it. None of it is about my fees, none of it is about my service, none of it is about anything else about me, it’s just about them. Then it gets to the point where, “I can totally see why people fall in love in this property and it's so important that we show people what this property actually offers. Here are a couple of ways that we can do that.” Bear in mind, by the time they've already got to ask and called us, they've gone and seen our Google reviews. They've seen our social profile. They’ve already assessed us when they make the phone call. Jason: Sure. Michael: It’s so important that you’ve got some social proof and some history there. If you're just starting out as an agent, get reviews, get some social proof because you really are fantastic. As people, we’re fantastic, and there's so many great attributes. If you're starting fresh, you don't have to look fresh. Jason, you're helping build websites. You can make someone who's just starting out look as a major player in the marketplace. Jason: Absolutely. I tell potential clients, there's no reason why a company with zero doors or even five doors has to look any different than a company with a 1000 doors. They can have just as good a branding, just as good of a website, and we can help them with the reputation stuff. We have our service gatherkudos.com for those listening that you can check out, which helps you facilitate or lubricate I guess if you will, that process of getting more reviews from clients. Michael: There's no reason why you can’t. “I don’t have clients to get reviews.” “I'm sure you've done business with people before and they can leave you reviews.” That’s all you need, just that momentum. From the time that we’re meeting with them, they know a little bit about us. I'm not concerned about any other services because they all know that we collect rent, and we find tenants, and we manage maintenance, and we do all that stuff. It's going to the owners that we will love their property, and really focus on the things that they love also, and identify the weaknesses of the property too because it’s important for us at the start the owners to acknowledge their property may have some shortcomings. They wouldn’t have to have that awkward conversation later. The prospective tenants said that, “I like the pink wall in the kitchen.” We get the owners to draw out what they think is needed in the start, and then it sets the time. Then I bring out the virtual goggles, and I say, “This is one way that people are really going to immerse themselves in your property from their own lounge room. We also had virtual goggles and Oculus Rift in our office, so when people came in and they want to get a rental list, we stop giving out paper and we would say, “What are you after? A three-bedroom, two-bedroom?” And give them the goggles, and show them a property. We have far greater success than coming in, picking up some paper in the office, leaving, throwing it in the bin later on for one property they might be interested in. We cut down on paper too, Jason. That was a pretty good experience. We went paperless. For new owners, they could say that we were focused on serving the customer, rather than they burdened with admin and just a slow death in a real estate office. We could show them some of the other tours we've done. We were doing drone work too Jason, where we would showcase the aerial view of the property in proximity to shops because that was another question that people would say, “Probably looks great, but what's it near?” In Australia, with Google maps, sometimes, they hadn't caught up, so the area would look like just massive farmland, but actually, they’ve built up a state with shopping malls, and freeways going through it. We take aerial shot, and show it from what it was near. With owners, I think, I was at 140 doors and 141 appraisals. Jason: You show up for these initial contacts at the property, or these appraisals, or whatever you're doing, and you would pull out virtual reality goggles, and set your camera there, and start describing what you do. Michael: Correct. Now, fast forward a few more years, we didn’t have to go to the property anymore, because I had the virtual tours online, and people can see them, and it would tie on my websites, so people could see that too, and they got to the point where people would make an inquiry, and I will send them a video message. They're already seeing all the proof statements, and a video message to start the initial conversation. I didn't have to meet all these owners, I try to meet all the owners. Sometimes I make time for if they're interstate, they were overseas, whatever the reason. I found other ways to get inside the living room without being in their living room. You have the virtual tours, and then you get the video text messages, and a lot of people will say, “I’m too scared to do a video text message. What if I say the wrong thing?” I say, “It's easy, don’t send it. Just do it again.” Jason: Right, re-record it. Michael: If you're doing a video, you can edit it. If it’s not live, edit. If it’s live, I’d say laugh. So what? Make a mistake, we’re human. I will make the same mistake speaking with you, as I would do on a video. Recapping on it, our process was, every property had to have a virtual tour. When I had the staff, they weren't happy going out and taking a virtual tour, because it would take them between 15 minutes to 30 minutes, maybe depending on how many rooms there were. It's a very fast process to take photos and then you just copy them on to the Vieweet platform, and you put the hyperlinks, the hotspots, and the tour is done. The tour might take you 45 minutes to do. For me, that's no problem at all, if it’s a big one. If it’s small one bedroom place, might take you five minutes to stitch it together. It just depends. The more you do it, the faster you become. Every property had the virtual tour, had the video, had some updated photos. It just meant that as a tenant, trying to select for the property, all the problems were answered. As an owner, we're now looking at other agents online who’s going to rent out their property, they can take the methodical process of photo, virtual tour, application form. That’s very simple process. We then are going to back it up with proof statements, like the rent is zero vacancy. All those other things that were important, because if you guys are doing an appraisal and start just reeling off everything you do, you're the same as everyone else, but if you can show proof statements, then it's 97% there. Jason: Love it. You can easily send a video introducing yourself, and you can send them link to a page of video testimonials from clients. If you can give them all the social proof, and you say, “Look at how we market the properties.” Send them the link to your rental listings. “Here's an example. Here's a property similar to yours maybe.” Suddenly, they can imagine all of it, they can see it, and it becomes real to them. This becomes this huge competitive advantage in this huge differentiator between you, and other property management companies, and then it's allowing you to close more deals. I would imagine it facilitates word-of-mouth, because people are going to talk about you because they're probably impressed. I would be impressive if somebody showed up with goggles, and camera, and show me tours, and sent me a video text message. I'd be like, “These guys are on top of things, and they're tech savvy, and they're going to take care of me out of the gate.” Michael: I guess one of the great things is, I won't mention the exact pricing, but we were full fee. We weren’t competing with, “But that agent is offering a cheaper fee,” anymore. We’re full fee, we’re doing full leasing fee for management estate. In Australia, we can't charge as many fees as you can in America. I wish we could, but we were full fees. I was maximizing every potential fee that I could, so routine inspection fees, higher statement fees. We were full fees, we don’t have to compete with someone. I remember when I started, Jason, and I’m trying to get traction, I sent out a thousand flyers to people and offered a low management fee to people for three months. I got one person out of the thousand that I sent out, that was great, because there were multiple referring client. But starting out, thinking that I have to charge something low, so that I can get in front of more people was one of the biggest crazy thoughts that I had at the very start. Jason: It's one of the most common beginner pitfalls is, “I need to be cheaper than everybody else to get started and to compete.” Michael: Yeah. If I just realized back over 10 years ago that my value proposition had to change. Jason: Yeah. Michael: “Not with my fees but with my value proposition. How do I not complicate it? Now, I no longer have any other office. I work from a home office. I've restructured because I don’t want to have physical staff. I've got VAs that do all the menial tasks. All the properties that we have are on the virtual platform. I've got no properties arranged at the moment. No rent arrears. Last year, I was abroad seven months of the year. I was in Turkey for two months, Indonesia for two months, in and out of America, or like interstate. I traveled a lot. This year, maybe four months of the year. If I get a new business, I will have someone go and do the virtual tool for me. I’ll train a simple person who doesn't want to do anything else if I'm not around. I enjoy going to the properties and checking them out. I'm a bit of a property nerd, I like checking them out, seeing how we can add value and connecting. The most important thing for me as an agency was to make sure that we have meaningful conversations, getting rid of all the clutter and all the noise. Instead, we will focus on the good happy goals, the meaningful connections, making sure that we can add value to our customers and our clients. That was our end result, to have that meaningful connection. The rest just all falls into place, it’s all systems. Jason: You didn't go into it thinking, “I just want to automate everything to the nines.” Your core end goal was, “We want to have meaningful connections,” and then, “I want to have freedom as I'm doing this,” to just focus on that. Michael: Yeah. Automating it just allows the opportunity to spend more time with people. Jason: I love it. Michael: It wasn't to make it so easy that I could travel a lot. It just meant that I need to get better connections. I pick up properties from going overseas. So many Americans travel. I've been in Europe and picked up a new management system [...] abroad. It gives me that flexibility. Also, you get to actually get new systems. People do things differently, so go out and see how other people are doing things to make their businesses better and how can you implement it in your business. It’s so important. Jason: Yeah. I think I heard a quote the other day that was, “Travel is the language of peace.” The amount of tolerance, and learning, and growth that happens just from being in different environments and different cultures, I remember taking a trip to Israel and it just was so different than what I was used to in the US. Even the checkpoints where kids were holding machine guns. It was just all so different and it was just really eye opening. I've been in Mexico, very different. You’ve been exposed to so many different cultures. You get to really fill your soul with having this variety in life. I think that's part of why a lot of people are in property management. They love that unique variety. There's all these different unique challenges that come with it. There’s all these unique opportunities to meet unique people. You really got to focus on the even best and highest portions of that by being able to treat that freedom. Michael: Don't be scared of doing anything. Don’t be scared of making mistakes. Trial it. If it’s not 360 for someone, if it’s not video for someone. Go ahead and trial things and see how it can give you that freedom, but also to be able to engage with people, family, and friends. Imagine if you live in a suburb and you've got a sports club, a church, a local pub, or whatever you’ve got, all these meeting places but you never get to go there because you're so busy trying to do the admin. You're a local real estate agent and you're not even able to local. Flip that upside down. Imagine if you're a local real estate agent doing local things because you have all these other things automated and being done for you while you're networking, and meeting, and engaging with people in your area. Imagine for a second how different that looks. Jason: Yeah, I love it. I think, Michael, everybody listening has probably by now hopefully felt a little bit inspired that there's this possibility that you've painted for them that is probably for a lot of property manager still outside the current world view. I think that's exciting. I appreciate you coming on the show. How can people get in touch with you and what sort of take away would you want to leave them with? Michael: Well, if you’ve got any questions about anything we've spoken about today, just hit me up on Facebook and send me a message and I'll respond that way. It’s probably the easiest way rather than giving you a cell number or an email, just go to Facebook, we can connect there. I'm on messenger, it’s the simplest way. Again, I guess the constant message that we've been discussing today is try it; don’t give up, try new things that may automate your business and give you more time tomorrow even though you’re spending more time today to get it done. Jason: Perfect. This is an episode I will hope that people will listen to more than once. Michael, I appreciate you coming on the show. Michael: You're welcome. Jason: I think you gave a lot of value. I'm grateful to you. Thanks for being here and sharing so many ideas. Michael: Thank you. Jason: Alright, cool. That was really fun for me as a nerd to have Michael on. Message him through Facebook. If you are a property management entrepreneur that wants to add doors and make a difference, as I said in the intro, then you should be a part of our community. You would love it in there. Make sure you join the DoorGrow Club. You can get into that by going to doorgrowclub.com. Our Facebook group, there's really cool people in there like Michael, and there's just some phenomenal helpful property managers. People that buy into this vision that good property management can change the world. That what the industry needs here, especially in the US is collaboration over competition. These are people that are willing to collaborate, willing to help, willing to support you. Make sure you get inside the DoorGrow Club Facebook group and check it out. If you join that group, if you apply and join that group, it's free, but you have to apply. We will give you some free gifts including a fee bible and some other really cool takeaways and gifts over the next few days after we welcome you to the group, just to welcome you aboard, part of our Facebook group. Check that out at doorgrowclub.com. Until next time everybody, to our mutual growth. Bye everybody.  

Gospel Tangents Podcast
Church Founded in Manchester (Not Fayette) Part 1 of 4

Gospel Tangents Podcast

Play Episode Listen Later Apr 1, 2019 21:21


President Nelson has made a big push about using the name of our church, but it wasn't always known as the Church of Jesus Christ of Latter-day Saints.  Michael Marquardt, an unsung hero in Mormon history, tells why the church changed names a few times. https://www.youtube.com/watch?v=MwMGkNRDo8U Michael: In May of 1834 members of the United Firm, which was like an auxiliary of the church at that time, met and changed the name of the revealed name of a Church of Christ to the Church of Latter Day Saints. And that's where that name comes in. GT: Now, I just interviewed--in fact we just published it yesterday it was--an interview with Steve Shields and he said that it was Sidney Rigdon who came up with that name Church of the Latter Day Saints. Michael: Yes. He proposed that. Sidney Rigdon was an elder and also high priest in the church. And the church is in deep debt at that early time of 1834. And that was one of the reasons at that time that they, said that the church was organized in Fayette--to protect the organization. It's the same reason as the next year in the 1835 First edition of the doctrine and covenants, they used pseudonyms. No there was not real names but other names. So people would not know who the revelation that we're referring to to protect the organization, protect the individuals. GT: For financial reasons is that the main reason? Michael: From what I can gather that that's the main main reason at that time. GT: Okay. Okay. So let's recap here. So April 6, 1830 the Church is organized in Manchester. In 1833 it's published that it's still organized in Manchester. In 1835 we start having some difficulties with finances. So they renamed the Church: Church of Latter-day Saints. They left out Jesus Christ, by the way, I'll add in. Michael: Well, it was 1834. Yeah. You'll notice sometimes while the name, Jesus is not there or the title Christ, it was also used at that time. You probably noticed that Michael said the was founded in Manchester, New York, contrary to the official church history record that the church was organized 30 miles away in Fayette.  How does Michael make his case, and why is there a discrepancy? GT: Why does the church say Fayette and why are you saying it's in Manchester? Michael: Well, it's basically trying to look at over a period of time, where the baptisms occur, where the revelations were given. And, of course the early Church of Christ did publish in the Evening and Morning Star, the first church periodical that it was organized and established in Manchester on April 6. And that's also where you find where it mentions six members. So there's probably was six individuals. We don't know if they're a male or a female. GT: Okay. You said this was published where again? Michael: In the 'Evening and the Morning Star' in Independence, Jackson County, Missouri. GT: And what was the date on that? Michael: It would be March, 1833 and April, 1833. GT: So in March and April of 1833. The Evening and Morning Star is saying that the church was organized in Manchester, not in Fayette. Michael: Correct. Marquardt says several revelations occurred in Manchester in April 6, 1830, and this was because it was the first church meeting.  Were you aware of a discrepancy in the historical record for the location of the founding of the Church? Michael Marquardt says the Church was organized in Manchester, some 30 miles from Fayette, NY. Does he make a solid case?

Alpha Control: a Lost in Space Podcast
Special - Calling Alpha Control: DR. SMITH (MICHAEL PANZAROTTO)

Alpha Control: a Lost in Space Podcast

Play Episode Listen Later Nov 22, 2018 61:59


CALLING ALPHA CONTROL: DR. SMITH (MICHAEL PANZAROTTO) SMITH: Welcome back for a Special episode of Alpha Control: a Lost in Space Podcast. Today I’m flying the Jupiter 2 solo without my trusty co-host Kurt, but that’s because we have a very special guest to interview, Dr. Zachary Smith. Dr. SMITH is a renowned Physician, Psychologist, Cybernetics Expert & retired Colonel in the USAF. In retirement, Zachary has established a second career as a best-selling author of several fascinating books across wide-ranging topics. His latest non-fiction release (which is just hitting the book shelves) is titled ‘The Social Psychology of Galactic Castaways’. This long-awaited volume is the result of over 20 years of research he conducted using the case study of an anonymous group of subjects, he refers to only as the ‘Family R’. Written in Zachary’s usual informative but highly readable style, this book will be appreciated by academics & the general public alike for its brilliant use of language, as well as its ground-breaking conclusions. Dr. Smith was born in New York, but grew up in Marietta Georgia, being raised by a dear Aunt & Uncle after losing both his parents in a tragic boating accident. His formal academic career began as a Marshall Scholar at Oxford University, (where he reigned as the Grand Master of the Oxford Chess Society for three years in a row) and culminated several years later when he graduated cum laude from Harvard University with degrees in both Medicine & Science. Next came a distinguished career as an Air Force Flight Surgeon. His pioneering work in the fields of Environmental Psychology and Robotic Artificial Intelligence landed him at Alpha Control where until late 1997 he ran the Human Factors-Flight Medicine divisions for the Jupiter Missions. He joins us today to talk about his New Book, ground breaking research, as well as his fascinating life filled with unique experiences and varied interests. I hope you will enjoy this captivating interview with acclaimed author & renaissance man, Dr. Zachary Smith. MICHAEL: Well, that was a real treat getting to speak with “Dr. Smith”, but of course this homage to the character is only possible, because of the talents the man behind this uncanny Jonathan Harris impression, Mr. Michael Panzarotto. Mr. Panzarotto was born & raised in the city of Baltimore & still resides in Maryland today. A Lost in Space fan from the age of 5, Michael was drawn to the gifted performance of Jonathan Harris & his portrayal of Dr. Smith. In fact, Michael admits that he started imitating the iconic Smith character all thru Junior High School; even though it didn’t help him getting dates. In addition to Harris, Michael was drawn to several other classically trained actors who played significant roles in sci-fi & horror films; such as Vincent Price & Peter Cushing. Impressions of those performers soon followed. The acting bug caught Michael in High School & he’s been following that passion ever since; appearing in numerous local & regional theatre productions. Mr. Panzarotto is also famous among the online LIS fan community for his spectacular video impressions of Dr. Smith that he frequently posts. I want to speak with him TODAY about his love for LIS, Jonathan Harris & acting. PODCAST INFO: This interview was conducted on 4 OCT 2018. LINKS: Never Fear Smith is Here-Sydney 1994: https://www.youtube.com/watch?v=t4OXzN9qGts Bill Dana Show: https://youtu.be/SRjJMcT3RYA Price & Harris, The Kind Mr. Smith: https://youtu.be/enIB4m6Kx5k Lights Out: https://youtu.be/rtSqAyAAw9c http://www.jacobsbrownmediagroup.com/lost-in-space-collector-set.html http://www.marccushman.com/books.html https://www.facebook.com/alphacontrolpodcast/ EMAIL: alphacontrolpodcast@gmail.com

英语每日一听 | 每天少于5分钟

更多英语知识,请关注微信公众号: VOA英语每日一听Michael: Alright, so Simon, do you have a favorite movie?Simon: Again, that's difficult question so I can't say one favorite movie but I can say that I really, really enjoyed The Lord of the Rings, well mainly because as an elementary school student I read the book, and as a small child my father would tell me stories about Lord of the Rings so when they finally came out on the big screen with big money production and awesome special effects, yeah, I was quite impressed. How about you?Michael: Oh, I liked it as well, and I read the book when I was in high school. I like the movies a lot but it still doesn't compare to the first time reading the book. The book was fantastic but of all the adaptations of that book this movie is probably the one, or those three movies are probably the one that I enjoyed the most.Simon: Yeah! That's true! A lot of adoptions are really quite terrible, aren't they?Michael: Which of the three did you like the most?Simon: I liked the first one. The first one. It has a story and it had, you know, what-will-happen-next anticipation and yeah, but all three were good.Michael: Well, it's interesting, you're favorite is a trilogy, and my favorite is a trilogy too, and that's the Godfather trilogy, and my favorite is the second one.Simon: Oh, you like the second one. That's surprising! Most people like the first one the best.Michael: I like the first one a lot but I like the second one because DeNiro is in it and I like the story of Don Corleone in Sicily as well.Simon: Ah, yeah, flashbacks!Michael: Yeah, and I think that the real conflict in the story comes out in the second one. More so than in the first. I see the Godfather trilogy to be very similar to a Shakespearean kind of trilogy, tragic, I think that Michael Corleone is a tragic hero and I like Shakespearean trilogies to so perhaps that's why I like it.Simon: Oh, that's a really good explanation.

Origin Stories
Origin Stories - 002 - Michael Steele - Former RNC Chair

Origin Stories

Play Episode Listen Later Sep 13, 2018 65:48


In Episode 002 of the Origin Stories: A Podcast About Politics and People, longtime talk radio producer Brent Jabbour speaks with former Republican National Committee Chair Michael Steele about growing up in Washington D.C (and spending time in the south) during the civil rights era. He also talks about his time in seminary school and his transition into politics. Subscribe to the podcast onItunes, Google Play, Stitcher, Spreaker, TuneIN, or wherever you consume Podcasts. Again, if you like the project share it with your friends, follow me on Twitter @BrentJabbour and/or like the page on Facebook. Transcript: (Intro) Brent Jabbour: This is episode two of Origin Stories: A Podcast about Politics and People. My name is Brent Jabbour your gracious host, I guess if that is what you want to call me. Today we are going to have a conversation with former Republican National Committee Chair Michael Steele. Now, the reason I chose Michael Steele, is because, in the lead up to President Trump being elected, he was very very critical of the man. And, I thought made him reasonable guy. It made him a guy who didn't necessarily walk the party line to get ahead, to get that Supreme Court seat, which we actually talk about. But, also, when I was doing research into him, I found him fascinating. He went to seminary school, he was planning to become a Catholic Priest. He kind of fell into the world of politics. Also, we spoke about Civil Rights and racism in America. What it was like growing up in Washington D.C. during the 1968 riots. He lived not too far away from U Street in Washington D.C. where much of it was burned after Dr. King was shot and killed. So, it was a really, really, interesting conversation. He was running a little late so I had a lot of time to think about things and prepare for that particular conversation. I prepare, but a lot of times I just want to have a flowing conversation. I just want to speak with people. So I don't want it to feel like an interview with a bunch of prepared questions. It's more so a conversation about where that person came from and how they came to be, so we can all relate to them. There is a little bit of a funny scenario that happened. As I do this, I don't actually have a location. I don't have a studio or anything. So, generally what I will do is pack up my bag full of gear and I will take it to the office of the person I am interviewing. Now, Michael works remotely very often. Kind of here, there, and everywhere. And, so while I was arranging it, and I really wanted to get him in, he could do it while he was in Bowie, MD, which I believe is also where he lives. But, since I didn't have a space to do it, I had to essentially figure something out. So, what I did is, I rented a hotel room, and I didn't want the full rate, because I guess I was just being cheap. So, I actually made an arrangement where I came in in the morning and rented a room by the hour. And, as an anxiety-ridden young man I kept thinking the whole time, people are going to think something is going on. There is a certain connotation about a man who rents a hotel room by the hour first thing in the morning. But, nobody really thinks those things, it's just all in my head. It's irrational anxiety as I like to call it. Once Michael Steele came in, it was just a pleasure to talk to him. He had kind of a family deal going on so he tried to make it quick, but I held him for about an hour. And, I think we had a really, really good conversation. He had similar experiences to me because I grew up going to an all-boys Catholic High School as did he. So we kind of have these mutual situations that went on in our lives. So, I think you will really, really enjoy this. Thank you so much for listening to the previous two episodes. If you really like it, go ahead and share it with your friends. Because I would love everybody to get in on these conversations. And thanks for following me on Twitter @BrentJabbour and remember to subscribe on iTunes so it gets delivered right to your phone every Thursday when we release new episodes. So, here it is Episode number two, Michael Steele, Former Republican National Committee Chair, Lieutenant Governor of Maryland, Here we go: (Music) Brent: So, you brought up family to start and I won't get into depth into that portion of the conversation. You grew up in D.C. correct? In Petworth? And one of the things I realized is you would be have been nine-ten years old during the riots of 68... Michael Steele: The 68 riots, I turned ten that October. Yeah. Brent: And what was that like. Were you cognizant of what was going on at the time? Michael: Yeah. Very much so. In fact, that April, when Dr. King was killed, my mother and I were in downtown DC. We had gone to Julius Lanzburg which was a big department store, a furniture store at the time. And we were on our way back up Georgia Avenue. And, someone jumped on the bus and yelled: "They killed King!" And there was a huge gasp on the bus and it was the weirdest thing because for the rest of the ride home it was dead silent. I mean, buses are usually quiet, but you hear some little chatter here and there. But you could hear a pin drop on this bus. And, It was one of those moments when we got home, and my mother was very upset, and sort of explaining what had happened. My dad comes in, having navigated his way uptown and actually came through areas where they had already started to burn buildings and started to turn over cars and he was very bothered and said: "Folks out here are crazy. They're burning up everything." But, it was really at that moment that you began to understand the impact, that King had had. My mother referred to him as a friend of the family. And so, her explanation to me was that a friend of the family has died. So, that put into context for me what Dr. King meant, not just to the black community at large, but specifically to my narrow slice of it, ya know, my family. So, it was a very impactful day. Brent: Just so I can clear everything up, so I have the full Michael Steele story. You were adopted correct? Michael: I was adopted yes. My sister and I adopted. Brent: And I imagine (by) an African American family based on the reaction (to King)? Michael: There weren't too many white folks adopting black kids back in the day. Brent: It's still D.C. Michael: They were progressive, they weren't that progressive. Brent: When you are in school and everything at that time, are you learning about Dr. King? Did you already know who he is? Michael: No, not really. Dr. King was not on the curricular because it was a real-time experience. Today, he is in the history books. He's an entire class in some courses. Back then, a lot of people forget, Dr. King was anathema to a lot of folks. A lot of folks were not appreciative of the marches and sit-ins and his approach. There was a reason why he wrote the letter to the pastors from the Birmingham jail. Because those pastors were ticked off at him and he wanted to clarify for them that they were the ones who were standing on the wrong side of history. So, that gives you some understanding and appreciation. The same with these towering figures of the day. Malcolm X who was another one who I would grow to understand and appreciate and really get his philosophy. These were, back then, the way we look at political and activist figures today. They're an annoyance. They're loud. They're taking up time on my news. And so, you had that perspective, that tension, that pull and push by what was going on at the time. And I think for a lot of people, particularly for young folks like myself. We were much more concerned about watching Batman, as opposed to paying attention to the politics of the day. Brent: And, did you start to learn and understand the Civil Rights movement after that day. Michael: Well yeah, well again, I'm ten years old. So, from an academic perspective, the answer is no because there really was no context to that until I got into high school. That was a short three or four years later, but still, it wasn't a real-time experience where you would sit down and say, ok, this makes sense. Where a lot of that education would come would be from my parents in their limited way. They weren't towers of political activism or journalism. They weren't writing the narrative. Or even following the narrative that way. But they did put it in the context of what it meant to be a black person in Washington D.C. in the 1960s. It did put it in the context of being a black family from the south. My mother is from Orangeburg. So, we would spend our summers in Orangeburg. I remember even going visiting my great aunt in 1982. And taking her to work, because she worked at a country club. And taking her to work, and I dropped her off at the front. And she said: "Baby, I can't go in the front door." I was like "Why not?" And she pointed to the top of the mantle, and it said: "For Whites Only." This is 1982, they are still displaying the sign. It was family that contextualized the racism and challenges that black folks had to deal with every single day. It wasn't something that you got in a classroom setting. It wasn't something you got in the workplace. It wasn't something you got on the playground. It was really that learning and understanding came from how your family presented that narrative to you. Brent: And, now you've become, a spokesperson, a public figure at this point. And when you are in High School. You're getting into high school, maybe you are 16 years old, and this is in the 1970s. And there is still a long way to go. There is still a lot of racism. And D.C. is probably one of the most African American cities at the time. Do you start to get involved then? Do you start to speak up? Michael: No. No. I was not an activist type. I have never been an activist type. As pro-life as I am, I've only been to one pro-life March and that was by accident. And it's not because I don't support the cause, that's just not my thing. That's not how I express my activism. I'd rather personalize it so you pay attention. I don't want to necessarily get lost in the groupthink. I want you to understand where I'm coming from. For me... I went to a Catholic high school. Archbishop Carroll High School. It was a place where a lot of the... It was an all-boys Catholic high school. So it was a place where a lot of the children, the sons, of political figures, they sent their kids there. So, I had this wonderful cross-current of class, race, as well as other intangibles that you kind of find in a place like that at that time. And Carroll was unique in that it was, they had achieved that balance between black and white. So, it was fifty percent black, fifty percent white school. And you had an opportunity to interact with kids from the suburbs. I was a city kid. So, we had a very different view of the boys from Bowie. So, it was a lot of that. It was the experiential, it was the in the moment for me that kind of taught me how to best do and be and exist. And from that learn how to express my views. So, being surrounded by these kids, and getting to know their parents. I took a liking to politics. And, really thought about doing that at some time. But, my core was focused on becoming a priest. So, while the politics was fun, my calling was to be a priest in the Catholic church. So my thinking was geared toward that. And I would later move into that. Brent: It's weird because I have a similar experience, although not wanting to become a priest. But, I went to an all boys Catholic High School in Toledo, Ohio. But, unfortunately, that made it more segregated. Because it's a city of 20 percent African American. I grew up, my stepfather is black, so I had been used to that. By the way that is one of the hardest things to tell people. Because I, as a liberal, semi-social justice warrior type person, I don't ever want anyone to think that I'm just telling you I know black folks. I don't want that. But I got lucky in the way to have those experiences, so I have family that is black. But in my high school, because it is a private Catholic High School, and even went to a private Catholic Grade School, but that was coed. There were 4-5 black kids in our school. It was mostly upper-Middle class kids, some very wealthy, and I think a lot of the black kids that was, unfortunately, just checking a couple of boxes. And, also at the same time, they were helping the community. And, of course, the school was not in the best neighborhood. It was by the University, but 2-3 blocks away from the most dangerous parts of Toledo Ohio. And, so it was one of those things, where I felt like, I wish I had the opportunity to go to a public school. Michael: Well, the experiences are there. But even in that limited space, what you had, was the experience of home. And that contrasted with 3 or 4 black students who went to your school. It still contrasted with the majority of the experiences you would have at the school because, on any given day, your encounter with those 4 black individuals was probably very limited, unless you became close friends with 1 or 2 of them. Outside of that, and I always believe this, because, from my own experience, home life is outcome determinative. So, I know people who have had very limited exposure to African Americans but have a heightened sensitivity and understanding and appreciation of the black community in a very respectful way. Not in a condescending, oh let us help you poor thing, kind of way. And that is because of how they were raised. They were raised with the sensitivity of understanding that that community and our community, while they look different, we are the same because we are Americans because we live in this area, you find all of these reasons to connect to that community. And, I'll give you a good example of what I mean by the outcome determinative nature of those personal experiences. I had a friend of mine, this was in the early 1990s, she was in Dupont Circle here in D.C. with her little boy. She is African American. He is African American. And he was playing. So, this other little boy, as boys tend to do, came up and started playing with him. and he was a white kid, and they were just playing and having a good time. Well, this white kid's mother comes over and snatches up her son. And told her son: "what did I tell you about playing with them?" Now, this is the 1990s. This is a young mother. This is not a woman who is "grandma." This is someone who is in their late 20s, maybe early 30s, who is clearly instilling in her child racism. Looking at someone who is not white as other. And that is going to have an outcome-determinative effect on this kids expression and appreciation and view of black people. Now, the long story short, my friend who heard this exchange, went up to this woman, picked up her son, and proceeded to smack the crap out of the mother. And said: "How dare you teach your child to be a racist." And walked away. She literally smacked her. But, that's my friend. I can understand. If you knew her, you would say: "Yeah, I see that." So, when you take that experience in 1992, and you relate it back to King's death in 1968, you can see how even though it's a connection, that all of those steps of achievement in between that there are gaps. There are gaps. There are gaps that come from ignorance. There are gaps that come from a sense of disconnection. There are gaps that come because you come from a line of racists. I mean, there are all these things that still push forward this negative narrative. So the family piece, for me, is a critical part to beginning to address a lot of these issues around race. Because race is not an innate experience, it is a learned one. Brent: Right, and I think that is part of the reason I started this project. A lot of it has to do with the idea that... I am talking to young people, my friends, they are in their 30s and in their late 20s, and they have kind of shut themselves down now. Because, they see somebody with that learned racism, with that learned take on whatever issue we face today, and they say: "I don't want to talk to that person. I can't relate to that person, I don't want to be around that person." Okay, I can not relate to a lot of people, but number one, we all have shared human experiences. But, also, you can't... Michael: You can't walk away from that. They have to... Look, the only way you are going to start to change that cycle is to engage. Imagine if King decided: You know what? I just can't relate to Boss Hogg, I can't relate to what's happening in Mississippi, or what's happening in Arkansas, what's happening in places like... You know, everyone thinks about the south, but the greatest experiences of racism I have had have been in the north. Brent: You can actually look at cities like Boston. I mean Boston is probably the most racist city in... I don't want to crap on Boston, but the fact is... Michael: Their history is more profound than... One of the things I learned growing up, spending a lot of time... Again, I grew up in the south, I grew up in D.C. D.C. is a southern jurisdiction. It's below the Mason Dixon Line. But, I spent a lot of time in my parents' backyard in South Carolina and in Virginia. The one thing you could always appreciate is they just let you know right out front: "Naw, I'm not feeling you." And in the north, people put their arms around you, they pretend, then they do all those other things that aren't so Christian. Brent: I think the point that I was trying to make is: You have to understand these peoples' experiences to understand why they got there. And as you said, when it comes to racism, that poor white kid... Well hopefully, there are two scenarios that could come out of it. One, he is going to continue to be racist because his mom is going to continue to reinforce that. Plus, to be fair, he also saw a black woman slap his mother, with a being a young boy not having any context to understand why. Michael: Well yeah, I hadn't thought about that side of it, but yea. Brent: But, you are also going to have the possibility where she learned a lesson that day. Or, maybe he learned that lesson to say that these people aren't so different and that what she was saying was wrong. That's hard because it is hard to look at your mom and at 5 years old say: "Oh, she's wrong." In something that is a big grand scheme of things understanding. So, that was really, almost the full reason why we are doing this. Why are there people who are like this? Well, they grew up that way. They learned bad habits. Whether that's true or not, you get to decide that yourself. So, Michael, you said you wanted to be a priest. I was also going to bring this up, when I was in high school I wanted to be the Pope. However, I didn't want to be a priest. There were loopholes. Michael: Yeah, you can be pope without being a priest. But you gotta have connections to do that. Brent: But, you went to school to become a priest, correct? Michael: Yeah, I joined, after graduating from Johns Hopkins, I entered the Augustinian Seminary at Villanova. And, I started the journey of discernment and expression of vocation, which was probably the most profoundly important thing I have ever done. And I would highly recommend it to anyone. Seriously, because what it did, was it taught me, and I was in for about 2 and a half years, it taught me the limits of my own understanding. It taught me the unrelenting love that God has for us. In our most banal, gross, just total craziness, God still says: "Lord I love you. Yeah, I love you, baby. Come on, you'll work through it, I love you." So, that is a very powerful moment of understanding. Then, the next level of that is turning that into an expression of understanding towards others. So, I look at people very differently. I see people very differently. I hear them very differently than I did before. It's because, in everyone's voice, you can hear pain, joy, fear, resentment, anxiety, all of these things we try to mask. And, it's one of the beautiful parts of vocation, for those who are called to that understanding, and that expression is that one of the gifts, one of the graces you receive, I believe, and it makes sense, that your senses are heightened. Think about a priest in a confessional for 5 hours listening to folks come in and just unload all kinds of humanity on them. Think about the grace it takes to sit there and for every one of those persons, to individualize that moment. We make jokes about, yes, go say three Hail Marys and an Our Father and that's the joke. But that is a very individualized moment. Those three Hail Marys and Our Father are specific to that person. So, that priest has to have an understanding of what that person is saying. He has to be able to listen in a way that God requires him to listen. That for me was just a wonderful wonderful time. In fact, it has defined most of what I have done publicly since. I bring that aspect of my seminary life into my expression as RNC Chairman, so that is very high profile, political. Or, as Lieutenant Governor, an elected official, responsible for service to the people of the state of Maryland. And as a husband, as a father, you try to figure out ways in which you do that. And my mother summed it up for me. And again, I believe in arcs, and how one moment in time connects to another moment in time. So as a young boy, my mother always used to tell me: "You need to shut up and listen." You need to shut up and listen. So, I understood as a young adult, connecting that moment in time from when I was a young kid to this moment in time as a Seminarian and future moments in time as an elected official, as a political leader that the core of that is to shut up and listen. Brent: That is something so hard, especially for my generation, for this rapid information culture. Because, you get stuck in this position, where you are having a conversation, like you and I are, and you get to this position you said something five minutes ago that I wanted to respond to. And, all I'm doing now is thinking about what I'm going to say. I'm better than that because I do this... But it happens to a lot of people. There are a lot of times where I am having a conversation with somebody about something very important and I can tell that they are not listening to me, instead, they are just waiting to talk again. I have the patience to deal with it, it's just what it is. I was going to bring up one more point about the Catholic upbringing. I'm no longer a practicing Catholic. Maybe an atheist, I'm not one hundred sure these days. Michael: Well, that's a leap. Brent: Well, that was a truncated version clearly. It wasn't... Michael: You woke up one morning, and: "I'm done with that." It's all good. God still loves you. Brent: I had a moment like you said the arcs when I was in high school. I think we were on a retreat. And, I was doing a confessional style thing with a priest. and I was just talking to him about something, and I was talking about my faith. Not that at that time, I was still full faith, but I didn't know that I loved the Catholic church but I was at that point. I asked him about something personal to me, I think my mother, and she was divorced and remarried. And at the time when that happened, she was divorced in the mid-eighties, the church was still much in the camp of... Michael: And they are still there. This Pope is pulling the church in a different direction on this issue of divorce. And there are a lot of folks inside the church who are very troubled by that. And I know such rules seem arbitrary and not really fixed to anything. There are Gospel underpinnings that support this idea of the indissolubility of marriage. But, you do then have to... Again, with the arc... Put it up against situations. Because life at the end of the day is situational. So, I remember asking a priest friend of mine as I was going through my processes and trying to contextualize and understand. So, if a woman is in a marriage in which she is beaten every day. Should she stay married to that individual? Or should she divorce? Now the accepted answer is she stays married, she just separates from that individual. She doesn't stay in the house where she is beaten every day. But, she is still married. So, then the next question logically goes: OK so two years later she's now living apart from her husband so she is now "estranged" they're separated. So, she is now in this limbo. She wants to move on with her life. Yet, she is tied by this marriage to an individual that if she goes back to will resume beating her. But, she can't move forward and find someone who will love her and do all the things that are set forth in the vowes: love, honor, yes and even obey on both the man and the woman's part. So what does she do? He didn't have an answer for that. And that's the moment we are now in the church. Where Pope Francis is Divining not defining but Divining an answer. Because he understands the scriptural context. And people relate back to the marriage at Cana they find all these connections. He's also got to make it relevant to what people are actually experiencing today because you don't want through church dogma and so forth to alienate people from God. So it's a very interesting track and it's one of those things that I think a lot of people are willing to jump to particular conclusions. And the one thing, having certainly been inside the church, you come to understand there is a reason it has been around for 2000 years. It's nothing if not patient. Brent: And I think, I was what I was going to say, he eventually said, some things are some things and some... He didn't really have an answer. But it helped me develop that pragmatic view that I kind of realize this man who is a priest. He was saying: "Well, There are no absolutes." Things can change... Michael: Well, there are absolutes. We have ten absolutes by God himself. We call them the Ten Commandments. And then everything else after that is not up for grabs, but... in other words. God has given us what he wants and what his expectations are of these frail things he calls humans. And he has done it in a way in which he fully respects the one gift he's given us. Which when you stop and think about the wisdom of God, you would say why'd he do that. This Idea of free will. And he says: "OK, you have free will but here are ten things I need you to do." And just ask yourselves: How hard are they? And yet, every day we find a way to break one or two of them. And, it speaks to why God loving us, is the core piece because it is the only way it works. Because otherwise, he would be too pissed off at us. Brent: When it comes to the whole "I may be an atheist" conversation. By the way my mother, I mentioned it to her one time she... I was like, I'm 34 years old, I'm allowed to have a crisis of faith every now and again. Michael: Yeah... Not in front of your mother. Brent: I think it was a lot of, I understand exactly what you are saying when you say God himself handed these ten rules. Michael: Everything else is man made. Brent: But it's hard for me because I look at the nature of man. And you can look at the Catholic church, but you can look at any church, any organized religion as it is. It feels to me like so many of the rules, they have a reason for them. They made these rules because... A lot of that, let's look at procreation, that was all to grow the churches. Michael: Of course, you can't take away from the practical truth of why certain things came into being. Look, we all know, staying with the Catholic Church, we used to have a married priesthood. We had a married priesthood for about 400 years in the 2000 year history of the church. And the reason they stopped having a married priesthood is because when a priest would die, the property of that priest would go to family members and not the church. So they wanted to correct that. This is that greedy period in the Church's history. Where you had a lot of man interest as opposed to what is in the interest of God. And so, I understand that. Which is why some of these rules that we adhere to today, they don't make sense if you know the history. Because, you can't sit there and say, we have a celibate priesthood because Christ was celibate. Well, then how do you explain the 400 years when we didn't. Christ was still a celibate back in his days. I get that and understand it. But for me, the institution is a human institution and all that it means. But, the faith that is born out of that institution comes from God. And either you buy into that or you don't. And, a lot of times, I think what happens is we allow ourselves to be distracted by the clothes we wear or the buildings we're in. As opposed to what God has given us innately. Which is a love for him and a love for each other. And the rest of it... Look, if I'm alright by loving you, then it doesn't matter whether or not there is a structure in which I have to go and do that every week like a church. Or, any other type of behavioral restrictions, that should not, in an ideal world, interfere with that. But we know it does. Brent: Well, and that is what I was going to say. You say there are the Ten Commandments and everything else is man-made. And I will give you the pro-life argument because we don't need to argue it. But the fact is, you see many elected officials using specific lines in the bible to go against gay marriage. Michael: No elected official should ever use the Bible for anything other than Sunday school and church services. They need to... You live that out, you don't dictate it to others. So, if you are pro-life Catholic, like myself, then you live that out. I don't need to judge you because God has made it very clear he doesn't like it when we judge each other. That's not my job, that's his job. You can look at the Bible as a source for the theology, as a source for the tradition, capital T, and that's fine. You can accept that or not accept that. You can make the case or not make the case. I choose to look at Deuteronomy where you are very clearly commanded to choose life. And I use that as a way to underpin not just my support for the unborn but my opposition to the death penalty. Because I'm not empowered to distinguish between the life of a child and the life of an adult who happens to be in prison. The church now, with the Pope, is coming around to that latter position. The Pope having recently changed the church's teaching on the death penalty to make it consistent with the idea that we are pro-life. We want to support a culture of life, it doesn't take away from punishment. Yeah, you a bad boy, you are going to get punished. But, there are limits to that punishment. And I think for political leaders, and what we have seen since the 1980s and the rise of the moral majority. The inculcation of that into a political system, thereby weaponizing religion via politics is one of the signs of end times. That to me is one of those signs that you've turned a corner now where you are using religion... And I think this is why you find so many people turned off more and more by religion because it has become more and more of a political theatre in which I get to sit in judgment of your behavior and your thinking and your philosophy. As opposed to as a political actor being more concerned about your welfare and the fairness of the governmental system and all of the things political leaders should be concerned about. Brent: And I think, just to wrap on this religious discussion, although I could do this for hours, I just think, and I basically think what we're saying here is, just live your best life. When it comes to things like that... see, I think the death penalty and abortion are two very separate issues actually because the government is not saying that you should get an abortion or that you have to get an abortion. They are giving you your right to choose. You may disagree with that, that's perfectly fine, but you don't have to do it. Nobody is going to force that. The death penalty is something that is put down by the government. Michael: But it's still an option. You have options... it's not required. Brent: A government official, a judge, or whoever is doing the sentencing, makes that decision; who is technically a government official. Michael: I would argue that the government has already decided in the first instance by writing the law that allows it; so the government has made a decision. Now, has been supported by the people when they, if by referendum they support that, or by the courts in representing the judicial approach, but there is government action on both ends. So, it's just a matter of how you view that. The government passed a law, so it dictated the terms of engagement on that issue, on abortion. On the back end, again, the government is acted. Yes. You're talking about the action of committing the death penalty, but there was a law that was put in place to allow that action to occur just as there's a law in place, to allow the action of an abortion to take place. So, the government is, in both scenarios in my view, a main actor. That's fine. Which is why my core argument around both of these issues is communities need to decide for themselves. No federal government role is required here because you're going to find, as we have found, that not just on issues like abortion and the death penalty, but on a whole host of issues, gay marriage, and the like, most communities want to come to their own, and should be allowed to come to their own conclusion as to what best represents the values of this community. Now if you don't like those values, typically most people don't live in that community. They go someplace where those values do work and if they can't do that; we do live in a society in which we have this little thing called 'majority gets to.' You can go out there and make your case and if your case wins, great. If it doesn't, it doesn't. Brent: Michael, you're kind of telling me, 'if you don't like it, get the hell out.' Michael: No, I'm not telling you that. I'm not telling you that. I'm just... look, look. If you and I disagree on something, what do we do? How do we resolve that? So, a third person comes into this conversation. It's going to take one of two sides. So guess what? That third person, the one who is on the short end of that stick, has got to live with the decision of the other two. So, what do you do otherwise? At that point, I can either get up from the mic and leave the room or I get to say, 'okay, we can finish the conversation although I hate this decision.' That's how this is supposed to work. That applies to everything, not just the very sensitive topics of abortion and gay marriage and all that. That's how this is supposed to work. That's why we're a pluralistic society. Brent: You got into politics, I assume now, having spoken with you in the beginning here, because you got the interest in politics while you were in high school because you were friends with people, who I assume, were sons of politicians. You went to school to be a priest and then you said, 'you know, I think it's time to do some civic duty?' Michael: Yeah. I'm sort of the accidental elected official; accidental party official. I never set out to be county chairman, state chairman, national chairman. Never set out to be an elected official. I liked politics. I liked being engaged in politics, but I was still, even at that time, very much involved in my church. I was a Master of Ceremonies in my parish assisting the priest. I trained the altar servers in the parish. So, I was much more still focused on a lot of those things, but these opportunities kind of came up and I found myself saying, 'okay, yeah, I'll do that, sure.' I remember the first time I ran for office in 1998, for Comptroller. I wasn't thinking about becoming Comptroller of Maryland, but Ellen Sabre and her team came to me said, 'we'd like to have you on the ticket.' My background was as a corporate finance lawyer. Very familiar with tax law and all that good stuff; so it's not like I didn't have the cred to actually do the job, but it wasn't something that I was thinking about. 'Oh, yeah, I want to be an elected official.' For me at that time my expression of service was different. It manifested itself differently. My approach to these things is, you know, God finds a way to put in front you, people who he wants there for a reason; for a particular time and a particular purpose and he knows you don't necessarily see what he sees, but, hey, you know, do it. Now, again, free will. You know, you just say, 'no, I don't want to run,' but it did trigger in my brain another aspect of service. How do I carry out... because I think, for me, a lot of that after I left the Seminary, was how do I carry out this innate desire to serve people. I want to be as helpful as I can. I hate seeing people living in certain conditions in which I think are unnecessary, particularly given the vast amount of opportunities and wealth and things like that, that are available. Why are you somehow isolated from all of that. So, for me, this public service piece was that bridge to connect or to answer the question: Why are you isolated from all of these opportunities? Let's look at that and let's fix it. That really kind of motivated me. Brent: You mentioned being the RNC chair, the Maryland party chair and you were the first black... I'm going to say you're the first black conservative? Michael: Well, it's the first African American state chairman in the country. I was the first one on the Republican side and national chairman, was the second black, but the first in the Republican party, because Ron Brown was the first African American elected to a National party chair. It's pretty good company. Brent: Let's be honest here. You can see it right now with a lot of Trump supporters. Do you face a lot of racism as a... Michael: You didn't face it. You know its there. Look, not everyone's going to love you, and they love you for different reasons. Some people don't like you because you threaten their interests. Some people don't like you because of the color of your skin. You know, I had people say some very stupid things to me when I was chairman and you take it for what it is. You appreciate it for what it is. You know that it's going to be something that you've got to address, but here's the thing; a lot of people sort of think that this is the purvue of Republicans only. Trust me, it isn't. Democrats come off like this holier-than-thou, like there's not a racist bone in their body, you know. I'm like, you understand where the KKK came from. It's your roots. It's there. Everybody has some connection and it animates itself at some point in time and history. It just does, but that, for me at least, is not the main part of the story. The main part of the story is: how do you press through that? Now you can sit back and you can become a victim of it and just sort of cower in the corner or be mad and angry - or - you can confront it and just call it out for what it is when it is and press on to do what you need to get done. You can't let those things, and I use King as the example, you can't let them handicap you. Brent: Of course, I wasn't blaming all Republicans and the point I was making about, today that you see, is the refusal by this administration to fully say that the 'alt-right' or whatever they are, are bad people and we're giving them a voice. I think that's not just what's happening now because of the politics and things, I think it's the 24-hour news culture. They know that they can say something stupid and MS, CNN... all these people are going to put them on. They're going to give them a voice and I feel like they're such a small sect of America. Michael: But they're not. Let me address that. Let's understand how we are where we are. We're here because for good, bad, and I think largely for bad, the current President, then candidate, pricked open a scab and marinated that wound. It gave license to people to openly express what they secretly harbor and think and feel and he used their fear as a weapon against themselves. I think that when you have the situation with Charlotte, you have the policies that are expressed, the Muslim bans and things like that, that is as much against those communities as it is a clarion call to those underbelly feelings that people have about those communities, and now you can go out and you can say it because I'm standing here and I'm giving you the green light. That, to me, is a very dangerous space to be in. Brent: I agree with that and I think that that scab, the wound was initially opened, I mean not initially opened, but this recent wound was opened during the Obama administration and a lot of them were saying that under their breath. I feel like, people like John McCain and people like Mitt Romney, they didn't say those things, so those people didn't feel emboldened and like you said, this President did on the campaign trail. That's an issue. I brought up my iPad because I wanted to bring some facts in here just to put a wrap on the RNC issue. You raised $198 million during the 2010 congressional cycle when you were on 'fire Pelosi bandwagon. You won 63 House seats; biggest pick-up since 1938, where you took the House. They were the most successful elections on House races, over 600 seats, since 1928. Why weren't you reelected as the RNC chair? Michael: ...because no good deed goes unpunished. That's why. Brent: In my head, I had for a long time I had this thing where I was like, 'Michael Steele must have been a terrible RNC chair,' but that's not the case. Michael: That's the narrative though, so let me tell you what the backstory to that is. The back story is, when I was running for chairman, members from around the country, what we call the 168, they're comprised of the national committeeman and national committeewoman and the state chairman of each state and territory. The number comes to about 168. That's the composition of the RNC. You go and you campaign for the job and I think I'm the only chairman who was a county chairman, a state chairman, and an elected official at the time he became chairman and so a lot of the members of the committee knew me from back when I was a county chairman in the 1990s. They knew me when I was state chairman in the early 2000s before I got elected to Lieutenant Governor. So they knew that I'm a grassroots guy and they knew that I resented the way the RNC did business with them, with that State parties. They wanted a champion and this so much explains Donald Trump in that, they wanted someone who would come in and break up the cabal that had festered inside the RNC. The special contracts. The no-bid contracts. The cozy arrangements. The consultant class that had taken over the management of the building, the operation of the building. The dictates that said, alright, if you want money from the RNC you have got to take our vendors. You've got to use our vendors. Even though those vendors didn't have a damn clue about your state or your jurisdiction or your candidates, but you had to pay a premium in order for the RNC to do business with you. They wanted an end to that. I was the guy to do that because I was willing to go in and break those eggs and in the process of doing that, pissed off a lot of people. I got rid of the no-bid process. I canceled about $20 million worth of contracts when I came in the door. You know that's going to piss off a lot of people and it did, and so you started hearing, literally within the first 30 days. I think the first call for my being fired happened three weeks after I got on the job. How the hell does that happen? Well, it happens because you're in there, I fired the entire building when I came in. I said 'no' to a lot of contracts that were already supposed to be paid for. Now the election of 2008 is over. Campaign's over. Why do I have all these people working at the RNC and why am I still writing checks from a campaign that was over? That disrupted the process and I made a lot of enemies. I will admit, I probably could have been a little smarter in dealing with some of that, but there is this sense that being smarter may, may not necessarily be the best thing. Following your instincts and your gut and once you start down that road you just do. I mean, I totally get it, so you have this situation and RNC was a microcosm of what would play out six-years later in that the body wanted someone to come in and clean it up. Clean up the swamp. To drain the swamp inside the RNC. Oh, guess what? Six-years later that's now a national message that those members and their constituents, the voters and their respective states and jurisdictions are saying, we want someone to clean up the swamp. I can see that arc; that connection there. Brent: So, what you're telling me is, you were the proto Donald Trump. Michael: In a little sense, yeah. Without all the crazy, yeah. Look, I said to, I've known Donald Trump a while, and I said to him that I love that Maverick style. This idea of shaking up the system. I didn't have a problem with Donald Trump calling out NATO, alright, because it needed to be called out. It had become a moribund institution. You know, no one had paid attention to it in about seventy-years and so, yeah, let's reevaluate, not necessarily the relationship, which is where Trump went, but let's reevaluate how we're doing business with each other and whether or not this is... we're modernized, so we're all on the same page... I got that. It was the same principle I applied at the RNC. Going in and shaking up the institution from within, but see my goal was to expand the party, so we did a lot of things to... the way we were able to win and how we elected Hispanic governors and African American State Legislators and Judges on the Texas Supreme Court was expanding the breadth of the party, it's reach and it's conversation with communities that didn't look white and over 65. That was the strength. What we're seeing now is a contraction away from that and they're using that contraction as a strength, but I think it's a great weakness to its own detriment. Brent: I have an issue because I understand. I understand the NATO things, the UN things, a lot of the dumb shit that Trump says. I understand it, however, I don't understand how Republicans, voters, that is to say. I get the white working class of voters. I understand them thoroughly. They voted for Donald Trump because he doesn't talk too different than they do. He said he's going to do something for their jobs and frankly, you know what, my Stepdad, worked as a UAW worker who faced a lot of racism from stupid people over the years. So the fact is, is that that doesn't surprise me. What does surprise me is men and women in your position who supported him. Who voted for him and they said, you know what, a Supreme Court seat is more important... Michael: That's politics. Brent: Right, I understand, but that's more important than being morally right? Michael: Look, I did not support the President's election in 2016 and I didn't for... along the moral grounds. The Access Hollywood tape, the whole thing, that is like... this is... there's more to the office than just putting a man or a woman in it. There's got to be something tethered to something that's morally sound, but you're talking about looking at the broad electorate. You have to ask yourself a question. If all of that is true and there is this, you know, there should be this distinction between your moral behavior and, a very clear distinction, that if you're morally off track, that that should be disqualifying, or whatever. Ask yourself then, why, after everything he's said and we know about Donald Trump and his relationship with women and the Access Hollywood tape, 52% of white educated women voted for him? He won the majority of the white female vote. He won 30% of the Hispanic vote after 'all Mexicans are rapists' and so forth. He won 10% of the Black vote. Remember, that was 0% at one point in the campaign. He grew it to 10% and the only thing he says is, 'what have you got to lose?' and all of a sudden all of those Black folks say, 'oh, okay.' What I tell people is, take the blinders off. Take the blinders of anger and just 'I hate Donald Trump' and all of that and try to understand the answer to the questions. Why these constituent groups voted for the man who is clearly antithetical to everything that they at least espouse to be about. When you begin to do that, then you begin to see America as it is because regardless of your station, regardless of your class, your race, there is a thread that he's able to pull on and he pulled on it well. Well enough to win a Presidency and folks need to fundamentally understand that because it says more about us then it does about Donald Trump. Brent: Absolutely and I've had the conversation a million times since the 2016 election with my progressive friends and I .... [interupted for time]... The reason I invited you here was because I thought you were as reasonable of a guy as you have been and it's been a great conversation and like I mentioned in my e-mail to you, I worked for Ed Schultz for about eight years and I remember seeing you on Bill Maher's show with him and you guys screamed at each other and it was such a great argument and you guys were having a good time and then the best part about it to me was you were willing to come on the Ed Show sometime the next week and you sat down with him and now you're an MSNBC contributor. So you can say you got my man Big Eddie to thank for that right? Michael: Yes, indeed. I loved Ed. He was a Maverick. He was a guy who pushed against convention and made the conversation real. He was not afraid to tell you what he thought; what he felt. That got him into trouble at times. I can identify with that. Those types of voices, you know, people like to try to put in a box and say, well he was this flaming Liberal or he was this flaming Progressive. Well, Ed was complicated. Ed was a lot of things. If you sat and talked to him you realized that he had some nice conservative positions as well. You understand his history, you know where he came from. That all makes sense, but what you can't lose sight of is that he was authentic and he was the same guy on TV as he was off camera. He was the same guy in the airport as he was in the studio and I think that that level of authenticity is what generated the audience that he had and I think that the kind of support, even when his time was up at MSNBC, that carried with him and stayed with him and that was reflected in his love for his family and the work that he did. So, yeah, I have a lot to thank Ed for. We had great conversations whenever I was on his program and we would go after it on that Liberal/Conservative thing, but it really wasn't about Liberal/Conservatives, it was really about having a conversation. Brent: That's why we're doing what we're doing today. I had a blast. I hope you had fun. Michael: It was a lot of fun and I do appreciate it, bro. Brent: Can we do this again? Michael: Absolutely. Anytime.

What We're Tasting
1:11 Chilean Wine is a Showcase of Vast Variety and Surprising Styles

What We're Tasting

Play Episode Listen Later Sep 3, 2018 26:27


Moving beyond workhorse bottles, you'll find a country full of distinct regions and a broad range of grapes. Explore Syrah, Cabernet Franc, and find out whether or not Cabernet Sauvignon is Chile's best red grape. A Carménère conversation looks at its sometimes polarizing flavors and considers the grape's place in Chilean wine. Befitting a nation with huge coastline, seafood and its natural partner in Sauvignon Blanc get a nod as well. Wines discussed: @3:56 Valdivieso 2014 Caballo Loco Grand Cru Limari Syrah (Limarí Valley) @8:05 Undurraga 2015 T.H. Terroir Hunter Alto Maipo Cabernet Sauvignon (Maipo Valley) @15:00 Maquis 2011 Franco Cabernet Franc (Colchagua Valley) Transcript: Jameson: Welcome to Wine Enthusiast's What We're Tasting Podcast. I'm your host, Jameson Fink. Join me as we discuss three fantastic wines and why each one belongs in your glass. This episode, we're looking at Chilean wines with Michael Schachner, who covers and reviews wines from the region. What We're Tasting is sponsored by Vivino. With the largest online inventory, Vivino finds the right wine every time. Including delicious Chilean wines. Download Vivino to discover and buy your favorites. And stock up at vivino.com/wineenthusiast. So a couple of months ago I met with a Chilean winemaker, Rodrigo Soto of Veramonte and more wineries, too. And we had an early morning conversation. Had coffee, it was very nice. No wine, it was like 8:30 in the morning. Maybe a little too early for wine, except for maybe sparkling. But that's a story for another day. But it was a really candid chat and I appreciated him talking about issues that Chilean wine faces in the United States and sort of the challenges that it has. And one of the things I thought that was interesting that I wanted to talk about with you, Michael, welcome to the show. Michael: Hey, thanks, Jameson. Jameson: Chile has this reputation wine-wise of just being this like value center, like value. Like 10 dollar wines and things like that. And one of the things we talked about is the challenge of people, you know, who are gonna spend 30, 40, 50 and more dollars on a bottle of wine to consider Chile as a source of those wines, which it certainly has. Do you see it as a challenge that Chile has to face? There are amazing values there, but now it's almost to its detriment as far as people trading up. Michael: I mean, Chile certainly built its reputation in the Western world with value wines. But that was like from a different era. More of a 1980s, especially a 1990s phenomenon, back when there really was quality wine being produced for under $10. But Chile has since then gone to probably one of the most organized and best-accessible tier systems of any of the New World producers, any of the major wine producing countries in the world. Chile I think is the seventh-largest wine producer in the world. And while probably a good chunk, 50% or more, of what they produce is still in that value category, you can go at multiple levels on top of that. You can go to a value plus level very quickly. High teens, low 20s. You can then go to what I consider to be what they do at their best. And that's a mid-tier plus luxury minus. And these are wines in the 30 to 40 dollar price range that you just talked about. And then they have their high-priced iconic wines, which they are modeled after California, Bordeaux, Italy, places that have had plenty of success with $100 and up wines. Chile has those, they struggle to sell them. Jameson: Well, I think that's our notion as wine drinks of value is also, value doesn't necessarily mean inexpensive, too. I mean, actually the three wines we're gonna talk about today are all in the $30 to $35 range. And I think when you start spending, you can still talk about value when you talk about wines that are over $10 or $15 or $20. Michael: Yeah, no. One of the great things about Chile is that they can deliver superb wines. Wines that rate 90 plus in this kind of mid-tier plus range. The economies of scale work for them. Larger vineyards, a cheaper workforce than, say, in the heart of Napa or in France or in Italy. And so it works to their advantage. They're able to extract a lot of quality and hence the consumer, you, me and anybody else, can receive a lot of good value at wines that are 20, 25, 30, 35. Jameson: So the first wine I want to talk about is Syrah. It's the Valdevieso, 2014 Caballo Loco Grand Crew Limari Syrah, it's a mouthful. The first thing I wanted to ask you ... Editor's Choice, 92 points. The first thing I wanted to ask you about that wine, is Syrah, Syrah is something that I don't really expect from Chile, or know that much about. Is this a rising star? Or have they been making it really notably for a while? Michael: No, I wouldn't say that they've been making it notably for that long. It's a great variety that came in when I would say in the modern era. These are wineries and winemakers that have evolved from a basis of Cabernet, and Cabernet Sauvignon, and Carménère. And then there's been a lot of experimentation. Chile has a terroir and a layout that's very similar to the west coast of North America. The north is very desert like, so that would be your Baja, California, San Diego area. Then you come into the southerly lake region. That would be like the northwest. And then you have that cut in the middle. And that to me reminds me very much of California. And so the same way California has had success and the ability to grow a multitude of grapes due to very kind, sun rich weather. Chile's very much the same. Especially in its central valleys. Limari is an area up north, it's an area that was known mostly for fruit production. And maybe growing grapes that were produced into Pisco. But winemakers started to understand that there's some limestone up there. There's coastal influences, and that maybe they could produce something in the vein of a cool climate type of wine. Chardonnay was planted up there, some Sauvignon Blanc as well, and Syrah. To try to capture a more oceanic style. Sauvignon Blanc didn't fare well, but the Syrah in Limari, although not a lot produced, I have found to be really excellent. It's a leaner, more structured style, but still gets enough son to be ripe. It's not tomato-y or green. It's more full bodied, but it just has something that gives it a unique character. Maybe it's those limestone soils. I'm not sure, but this one's an interesting one. Caballo Loco, the crazy horse. Valdivieso is one of the more traditional wineries in Chile. It's been around for a while, but they have explored different regions, they've explored different grape types, I would call them a more progressive type of larger winery. Caballo Loco has always been there catch all type of wine. Named after one of the owners of the company, who exhibited tendencies of being a crazy horse. He was a let's do this, let's do that, we can do this, we can do that. So he always had a wine named after him, Caballo Loco. And for a long time it was a mystery blend. It was generally speaking Cabernet Sauvignon, but they would never tell you the vintage, they might blend a few years here and there. They've expanded a little bit with Caballo Loco, to include this Grand Reservo variety thing, and it's again supposed to imply that this is a weird off the grid type of wine, not something you're going to see a lot of. There really are only a couple of producers of Syrah in Limari, and Valdivieso is one of them. Jameson: And where, just to orient myself, if I fly into Santiago, I mean how far away are we from the Limari valley? Michael: Limari is actually a bit remote. I would put it up in that northern quadrant of the country. It's very dry, it's where the Atacama Desert meets the ocean in it's most southerly area. You would go to the coastal city or La Serena, that's where you would go to get to the Limari valley. You can fly there, or I think it's roughly about a six hour drive from Santiago straight north on the ocean, and I've been up there once before. It's pretty remote, but it's cool, and just like the whole Pacific Coastline there, it's really quite beautiful. Jameson: And let's move on from Syrah, and talk about a grape that's maybe more well known in Chile. And that's Cabernet Sauvignon. So the second wine I want to talk about is the Unduragga, 2015 Terroir Hunter, Alto Maipo Cabernet Sauvignon, 91 points. First of all what is this Terroir Hunter series of wines all about? Michael: Unduragga, I can give you a little bit of background on them as well. Unduragga, that's a very big name in Chilean wine. The Unduragga family founded Unduragga, probably three, maybe four generations ago. It was one of the early family owned wineries in the Maipo Valley. They sold to a multi faceted business man, about ten years ago. And obviously acquired the brand name, that was important. And Unduragga has continued to produce a large amount of wine, but also some really interesting wines. Their most interesting are in the Tey Hachey, TH series, Terroir Hunter. And this is where their winemaker, a really cool progressive young guy, good friend of Rodrigo Soto. And a guy that I've loved to work with a lot, love to quote, love to meet with when I'm in Chile, or when he comes to New York. His name is Rafael Urrejola. And Rafa is a really good winemaker. Comfortable in various different varieties. Makes good Pinot Noir, makes some good Syrah, has been very involved in reclaiming the old vines of the south, down in Maule and Etota, so you get some Canyon, and some Malbec's, under this series. So it's usually older vineyards from various specific Terroir's within Chile, and there giving light to this. Going to Cabernet, is obviously the prime variety for Chile. It's what it's known for, and this wine comes from Pirque, which is a real, super good Cabernet zone. It's in the Maipo Valley, it's only about 20 miles outside of Santiago. Foothills of the Andes, can see the mountains from there. It's right on the edges of the Maipo river, and it's so alluvial, if you just go down a couple feet into the ground, nothing but gigantic rocks. And this is become the prime zone, basically call it the left bank, or the heart of the Napa Valley of Chilean Cabernet production. Jameson: So is Cabernet Sauvignon, is that Chile's best grape? Best red grape? Michael: Well I'm not so sure it's the best, it's definitely the one that's grown the most, it's the most prominent one. We talked about the value wines at the beginning. For Chile was able to produce a lot of pretty good, very nice, drinkable Cabernet in the $8, $10 range. It's harder for them to do that now with international pricing and just where everything's going. Cabernet likes dry, sunny, coastal weather. Same reason there's tons of Cabernet in California. There's tons of Cabernet in Chile. But there are some really good specific areas that get away from simple, industrial production, and give you some real grapes of character. Pirque is one of them. Jameson: And then what's up with Carménère, as far as it's status today? I know a lot of people, they've got this stereotype of, oh it's all, it's green, it's vegetal, blah blah blah. But is that the case now? Michael: Carménère has its tendencies. Its suicidal tendencies. It's a grape that was originally from Bordeaux, never replanted after the Phylloxera plague of the 19th century there, because it was just prone to greenness. And that was in a "cool climate". Chile being a little sunnier, a little warmer, having a higher heat index, and a higher sun index than Bordeaux, has had the ability to ripen Carménère better. Carménère is a signature grape if you will, simply because I think 98% of the world's Carménère is in Chile. For a long time people thought it was Merlot. Green tasting, herbal Merlot. It just has a lot of pyrazines. And it's very difficult to get that out of the grapes. There are now ways of going for max ripeness, then trying to maybe acidify the wine back into balance. It's not my favorite style, but that's what you see. It's the big sort of here we are, iconic Carménère level. And then Carménère at that inexpensive level, large crop, high economies of scale for the winery. That's not really one of my favorite wines. Jameson: Yeah, I like those green, herbal flavors. They're polarizing, it's like Sauvignon Blanc, some people love it. Michael: Cabernet Franc. Jameson: Some people can't stand it. But I like those flavors, and I think they are to me part of the grape, in trying to blow it up and blow it out. And obscure that to me does a disservice. Michael: Yeah but the feedback in Chile, is a very feedback oriented country. Being located where they are and exporting so much of their product. It's only 17 million people in the entire country. And it's not a really huge wine drinking country, despite the fact that they produce so much, and it's one of their top six industries. So they have to export a lot, I think the feedback around the world is, your Carménère's interesting, and we understand it's your signature grape and that you do it more than anybody else, but that doesn't mean we love it. I think you're a little more experimental than the average wine drinker. Jameson: Right, I'm the middle aged, natty wine, Brooklyn hipster drinker. So my demo isn't. Michael: ou might a liquid weed patch. Jameson: Yeah, exactly, I love that. Bring on the full on green pepper. Poor it into a hallowed out green pepper and I'll drink it. Michael: You get the bell pepper surprise, you can get that. So yeah. But you know what? Even Cabernet Sauvignon, and there is this typical Chilean character which there is a lot of mint, and menthol, and Eucalyptus, and tea, and tobacco, and these types of flavors and aromas, that work there way into the grape. And true Chilean Cabernet is pretty unique too. It may have the power and the structure, the smooth tannins of a Napa wine, or may have the age ability of a Bordeaux, but it's also, if you taste it blind ... And I've done a bunch of these top Cabernet's from around the world, they stick out. And it's generally speaking a little bit of that greenness. And just must be in the water. Jameson: Yeah. And again, those are to me, when I drink Cabernet, when I want great Cabernet, I want a little bit of those green herbal minty, Eucalyptus things. But again that's just me, and I'm an outlier. Just an outlier. Hey we'll be back to the show very shortly, but since you're here, I know you're already a fine of wine podcasts, why don't you check out our other show called, The Wine Enthusiast Podcast, download it wherever you get podcasts. So the third wine is a Cabernet Franc. It's the Maquis 2011 Franco, Cabernet Franc, Colchagua Valley, 92 points, seller selection. So for a herbal wine loving guy like me, is this Cabernet Franc going to make me happy? Or is it going to make me disappointed? Michael: This one might not be your wine Jameson, but it might be again, in tune with the global pallette. It's not a green, spicy, leafy version like you might get from the Loire Valley. Jameson: Right. Michael: Or that you might get in a cool year Bordeaux from Saint-Émilion. Or even a left bank wine with a fair amount of Cab Franc in it. It is more, probably in tune with the "International full bodied red style". But I like it in the sense that, Chile can be a little bit cool for Cab Franc, and some of the Cab Franc's that I have tasted down there have been really leafy, really highly herbal. They could fool you for being Carménère. This one comes from a cooler vintage, in the Colchagua Valley, that's an area we haven't spoken about yet. It's a really, I would say it's probably Chile's most, prototypical contained wine valley. I've described it in my articles, as resembling a small Napa. You've got hillsides on both sides, a river running through the middle of the valley heading out to the ocean, coastal influences. Warm, warm valley. And known for red wines. Maquis has there vineyards hidden down by the river. It's one of the cooler areas of the Colchagua Valley. And so they get a little more character. The Franco, is a double play on words. Obviously it's for the Cab Franc, but it's also a wine planted on its own rootstocks. So it's Pie Franco. It's not grafted, it's not an old vineyard taken over. It's a vineyard planted several decades ago. And it was planted on it's own stocks to Cab Franc. I think it's a ... Really, we're talking about wines that are tasted blind here. And so we're not ... When some of the characteristics that I talk about, and the point total. And the fact that, gave it an Editors Choice, Seller Selection, saying this wine can age. That's what impressed me in the tasting. Not so much it's, oh I can varietally peg this as Cab Franc. You, as a Cab Franc lover with an affinity for green, Finks an Irish name, so. Jameson: Yeah, Eileen Kelly, my mom. Super Irish, Jameson my first name. Michael: Exactly, so. Being a man of green, kelly green in this case. You probably might want a little more of that character in it, just so it reminds you of a nice Bourgeois, or Chinon or something. But it's just not going to do that. It's going to be a Chilean version, warm valley, fuller bodied type of wine. But I think very interesting. And one that can actually sit nicely with Cabernet Sauvignon, or any of the better, full bodied red wines that Chile produces. So it's one that I've always like. I think Maquis done one of the more consistently good Cab Franc's in all of Chile. Jameson: Yeah, and I just noticed it was a 2011 vintage. So it's already got a few years of age on it. Michael: Exactly. Jameson: So that bodes really well, especially with your 92 point review. And I want to touch on some other red grapes. What's a rising star, or maybe something that's been neglected, now is being revitalized, is Pais a big deal? Michael: Pais is a big deal in the regions where it comes from. That's mostly the southern regions where the old vineyards, that are dry farmed. And have either been barely tended to, neglected, reclaimed. That's where Pais comes from. That's the old mission grape. It's the old country grape. It's grape that was used for jug wines. And wine sold at the market for filling out bulk wine in everything. There's a movement to reclaim it. And to make it, can be done in a fun, natural way. I think for the nat wine funkster type, I think Pais is probably your very best bet. And the wineries and winemakers that are working with it tend to really fulfill that whole narrative. But my favorite obscure grapes, also largely from the old vineyards of the south. Areas like Maule and Etota, are the two C's. Carignan and Cinsaut, all grapes that were brought over from France in the 19th century, largely forgotten and neglected. Used just for bulk wine, co-op wine, these types of things. And now people are saying wow, Priorat in Spain is known for Carignan, other areas of Spain are known for Carignan. There's Carignan in the South of France. And it's a racy, red fruit style wine for the most part. It's got good tension, can be made in a fuller bodied oak style. It can be done in a more restrained, leaner style. So I like that. And Cinsaut another French grape that you see very little, is from the South of France, used in Rosé and things like that throughout Provence, and the lower Rome Valley. Is being done in a fresh, light bodied, Bougelet style. I think you would really like it. Jameson: Yeah, right up my alley. Michael: Yup. I think Rafael has a TH, a Terroir Hunter Etota Valley Cinsaut. There's a couple other winemakers in the country that are making it in clay amphora, or in neutral cement eggs to try to really give the off root, all history, all terroir, no oak, very little manipulation. Interesting wines and very small production. Small distribution, but they're out there in small numbers. I really like those two oddball grapes. Jameson: And then finally, I would be remiss if we didn't touch on white wine. I've had a lot of, I guess my introduction to Chile was probably Sauvignon Blanc, because I love Sauvignon Blanc, and I found really great Sauvignon Blanc, really tasty coastal type of wines. And I'm starting to have some really good Chardonnay's too. What's the state of white wine in Chile right now? Michael: Well, it's an interesting question Jameson, because in Chile, hands down the best type of cuisine, food, comes from the ocean. Comes from the Pacific. Jameson: Yeah. Michael: 4,000 miles of coastline. Gigantic fishing industry. Shellfish, crab, octopus, you name it. Anything that's in the Pacific Ocean, they pull out, and it's much better than the steaks. You want steak, go to Argentina. Jameson: Right. Michael: Or go to Uruguay, even go to Brazil. In Chile eat the seafood. So what do you want to drink with good seafood? White wine. Mostly though I've found that for a long time it was about quaffability, and fitting what they thought were norms. They weren't natural white wine producers, so they were trying to match styles. Chardonnay, for a long time was lost in the Chilean forests, with poor oak, overripe fruit. So you got the flat, melonny, banana ball, with a lot of oak. Some of it real, some of it fake. Really not a great way of putting a Chardonnay foot forward. Jameson: No it sounds very [crosstalk 00:23:06]. Michael: Sauvignon Blanc, got a lot of credit for being this coastal, fresh type of thing. I think it was a little bit premature, a little bit overrated. It led to some overproduction of Sauvignon Blanc. And also, I think just a flooding of the market. And I think it needs to be reevaluated. Made in smaller quantities, because there's too much Sauvignon Blanc competition. It's not as popular a grape type as we would like it to be. Or think that it might be. Sauvignon Blanc, yeah everybody drinks it. No not really. Jameson: Yeah, it's polarizing. It's a flavor profile. Michael: Not really, and I think that it's only 2% of the wine market in the United States. So you have this impression that, "Oh, I bet everybody's drinking Sauvignon Blanc". Not so. Chile I think, they have good coastal Sauvignon Blanc, but it runs the risk of being repetitive, and this zesty, quaffable, screw cap type of wine. Chill it, kill it. But there are a few that are, again where the vineyard matters. Where the winemaker's doing more with the grapes than simply just picking and popping them into a tank. There could be some work with cement. There might be a minute amount of barrel aging going on in there. And these wines I do find interesting. I find that they drink better on the spot. And with the local food maybe than as an export wine. But I'm glad you brought up Chardonnay, because I they're really improving it. Getting away from that over the top, blowsy, not necessarily well made, artificial style. And going with a little bit more of a Burgundian higher acid, and site specific. Trying to stay near the coastline, Casablanca Valley. You don't find hardly any Maipo, or Maule Valley. None of the internal, central valleys they've pretty much taken the white wine out of those valleys. Moved them close to the ocean. That's a good move. Jameson: Yeah, well I think it's a good move to explore everything that Chile has to offer. Don't be afraid to get into that $30, $40 range or higher if you can. But there's still great, easy drinking wines and old vines to explore. And fuller style. There's just a little bit of everything. So I think we should all be drinking more wine from Chile. And Michael thank you for being on the show. Michael: Good deal Jameson, great. Jameson: And thank you for listening to the What We're Tasting Podcast, sponsored by Vivino, wine made easy. The three wines we discussed today were the Valdevieso, 2014 Caballo Loco Grand Crew Limari Syrah. Unduragga, 2015 Terroir Hunter, Alto Maipo Cabernet Sauvignon. And the Maquis 2011 Franco, Cabernet Franc. Find What We're Tasting, on iTunes, Google Play, or wherever you find podcasts. And if you liked today's episode, please give us a five star rating on iTunes, leave a comment, and tell your friends. What We're Tasting is a Wine Enthusiast Podcast. Checkout Wine Enthusiast online at winemag.com.

The Frontside Podcast
103: React Components with Michael Jackson

The Frontside Podcast

Play Episode Listen Later Jun 14, 2018 48:51


In this episode, Michael Jackson of React Training and Rob DeLuca and Taras Mankovski of The Frontside talk about what is a component, and what a component is specifically in the context of React. They also discuss when it stops being a component and becomes something larger, how it has changed the way we develop UI, and thoughts on container and presentational components being synonyms for controller and view. References The Tweet that started it all Wil Wilsman: Does my application work in real life? Do you have opinions on this show? Want to hear about a specific topic in the future? Reach out to us at contact@frontside.io or on Twitter at @thefrontside. This show was produced by Mandy Moore, aka @therubyrep of DevReps, LLC. TRANSCRIPT: ROBERT: Hello, everyone. Welcome to Episode 103 of The Frontside Podcast. I'm Robert DeLuca, a developer here at the Frontside and I'll be today's episode host. We're going to be discussing what is a React component or what is a component with Michael Jackson. I'm pretty excited about this topic, a sort of off from a tweet that I sent out after a long workday, when it is something being called "component" because it was built with React components but it was more like a mini application? Then Michael replied to my tweet, as they're happening and he said, "What is your definition of a component?" which is exactly what we're going to be discussing today. I thought that was a really great question. With me, as a co-host is Taras Mankovski. TARAS: Hello, hello. I'm also a developer at Frontside. ROBERT: Before we get into the discussion, I would like to make a little announcement. We've been working on building a suite of testing tools to make acceptance testing JavaScript apps like React or Vue or Ember or anything else kind of JavaScript, fast and easy to maintain over the past few months. We call it BigTest. If you follow me on Twitter, I'm kind of loud about it. I love this project that we were working and one of my coworkers just published a blog post, giving an introduction to acceptance testing on React applications with BigTest. If that sounds interesting to you, you should check it out. We'll leave a link in the show notes. Now, let's jump right into it. Hi, Michael. How are you doing? MICHAEL: Hi Robert, I'm doing well. Thank you for inviting me to be on the podcast. ROBERT: Oh, no. Thank you for joining. I feel like this going to be really fun conversation. We went back and forth on Twitter a little bit and I was like, "You know what? This serves really well like a free flowing conversation." MICHAEL: Yeah, it's something I really like to talk about, specifically, when we're talking about components or when we're talking about React components. I think there's a lot stuff there to discuss and I think that React, specifically has really, at least defined that word for me. When you were talking about your mini application, I was like, "Oh, yeah. That's cool," and to me, that's kind of what these components have the potential to be, what these React components have the potential to be. It's kind of like almost these miniature applications that you stitched together to make a bigger one. ROBERT: Yeah, that's really cool. I was frustrated at the end of that day, just because that had so much logic crammed into it and you can kind of see that come through in the tweet but I'm not going to lie. After I sent that tweet, I was a little disappointed with myself because it came off a little bit like flangy but I guess we could just kind of jump right into defining what is a component. MICHAEL: When I saw your tweet, I was like, "Oh, you know like --" and of course, I don't know the component that you're looking at. It could have been terrible. Totally, it could have been terrible. I'm totally willing to believe that it was not a good component. But writing React is hard, especially writing good React is actually hard. At first, I thought it was easy but I think it's easy to solve your immediate problems but to write React to that is generic enough to solve lots of different problems, I think it's actually very, very hard and it's something that I've spent the last couple years learning. Anyway, that's kind of a tangent. But regardless of the component that you were looking at, the way that I've tend to think about these components is we used to have a model for thinking about how to build frontend applications -- ROBERT: Like MVC? MICHAEL: MVC, that's the one. That's the one that talking about. You have, here's your model, here's your view, here's your controller. You know, there are separate logical entities and lots of times, those even live in separate files on the file system and we keep them sort of separate and spaced out. As far as I can tell, that's a sort of paradigm. I learned it in school. By the time universities catch up with industry is at least, like twenty years, so it's probably something that was invented back in the 60s or 70s. ROBERT: I think it was like the 80s because Charles talks about it a lot and sort of Taras, actually because we're building something that's like a composable model, just like the Vue of React is a composable view, its components. I think it's interesting because I was listening to the Changelog Podcast and it sounds like you worked with Ember for a while. MICHAEL: I did, yeah. ROBERT: I forget, which podcast that was but we can find it and we'll link it to the show notes but I thought that was really interesting that you also came... Oh, maybe not came from Ember. You had experience with for, at least a couple years and that's where I came from. That's kind of where that tweet came from and was like, "Man, I don't like what happened to the word component," because when I think of component, it's like something that is encapsulated in a small piece of UI. But I'm okay with letting go of that. MICHAEL: Well, yes. Ember came out of something called SproutCore, which actually originated at Apple. Tom Dale used to be a developer at Apple. I'm sure you all know all of this but just for some sort of back story for others who might not. Apple was a place where MVC was really, really big. The whole Cocoa frameworks. They're all very much like, here's your controller, here's your view, core data has all of your models, that kind of thing. It's a software development philosophy that goes back a long time and has deep roots and I'm not here to suggest that because it's old it's bad, because lots of old things are actually very, very nice and good, especially in programming. We're starting to see a resurgence of functional programming ideas, for example, which have been around forever, since at least, the 60s or even earlier than that. It's not necessarily that I think that because it's old, that it's bad. I don't. ROBERT: Right, right. MICHAEL: But the thing that I do see in these React components is they kind of go very much against the grain. If you had, for example your model, your view and your controller as these vertical silos, just imagine turning that whole thing on its side and then cutting a slices of that, so that each of your React components has elements of MVC in it. They're all sort of mixed together. I run a training company called React Training and whenever I'm doing one of my training workshops, the way that I talk about it is a component is able to encapsulate three things: markup, which is the view essentially; state, which is essentially your data or your model; and behavior, which is essentially the controller, so what happens when the user is interacting with the view and clicking on the buttons? What do we do in response to the user input? You've got all three of those MVC elements in the React component. In fact, I've been meaning to kind of coin the term for a while. Instead of MVC, I call it MSB -- markup, state and behavior. ROBERT: You heard it here first. MICHAEL: That's right, here on The Frontside Podcast, we're coining new terms. ROBERT: That's pretty great. I guess coining off of that, is it fair to say that MVC kind of still lives on, except it's now in React? Or it's kind of more sliced up into smaller, more digestible pieces? We can always come back to this composability element, right? Would you say like really React would made it possible to compose many little MVC apps? MICHAEL: Yeah, exactly. The thing that people really, really love about MVC, I think you still have it in React. MVC, the thing that people always come back to is the separation of concerns. Let's just say, "I don't want everything sort of mingled together. I want it to be very clear. What is my model? What is my controller? And what is my view?" The cool thing about a React component is if you look at it, you still have very clear separation within the single component. You have a very clear separation of all three of those concerns: your state lives in an object called 'this.state,' then your view is whatever you return from your render method. That's in a completely separate spot, since still in the same component and then your behavior or your controller usually has its own method, so you can inline those in your render method or you can pull them out if this is how you'd like to do it. You can pull them out into instance methods. You can still have kind of that separation of the concerns within a single component. I think to your point, the React component model is all about composition, so this is kind of a term that we've actually adopted in other areas in technology. It's sort of just coming to frontend. The idea is you've probably heard of a service-oriented architecture for design in backend systems. These servers over here are application servers, these are database servers, here's our caching tier, here's our Ingress or LoadBalancer and maybe, you stitch them all together on the backend into one coherent system. You know, here's our storage and our image-resizing services. You stitch them all together on the backend into one coherent system but it benefits you to not build them all as one part of sort of monolith. We've got a lot of benefits from the decoupling. For one, if one piece of the system fails, the whole thing doesn't go down, so you can like swap it out or upgrade it and replace it with something else. I feel like that is kind of a similar idea to what is going on the frontend with these React components. ROBERT: Oh, microservice components. MICHAEL: Yeah, exactly. Each component is kind of like you said. It could be like a miniature application and it could be totally self-sufficient and I could drop it onto a page and it could just do its own thing or what I could do is I could take that app, that component and I could drop it into a larger app that can speak to it and can communicate state to it via the props that it sees and then can get state back out of it via these callbacks. I kind of view it as like all of these miniature systems that they can either be completely encapsulated and self-governing on their own or you can take them and compose them with a larger app. ROBERT: That's really interesting. I guess what is a component specifically in the context of a React. I guess, we kind of just answered that, that you can bundle all these things together, right? Does that make sense? MICHAEL: Yeah. The beautiful thing about this composition model is you can have all three of those things in the same component: markup, state and behavior. You can have all three of them right there, encapsulated in one component or once you discover more advanced patterns with React, you can actually make it so that a component only has two of the three or one of the three. ROBERT: And then it kind of like passes callbacks or props or state around? MICHAEL: Exactly. It can essentially delegate the responsibilities for handling the other pieces that it misses to other components around it. There's a pattern that I kind of coined last year called render props. ROBERT: Oh, yes. I remember hearing this on Changelog Podcast. I was actually one of the people that at first thought it literally was a prop name render. MICHAEL: Well, I mean it's not a bad way to think about it. It could be a prop name render. ROBERT: But then I found out it actually is a prop that you send JSX too and render whatever is there. MICHAEL: Yeah, exactly, a prop that you used to render stuff. It's the way that I describe it. When you think about it, any component, for example that accepts a render prop is really just delegating it's rendering to some other function. It can contain the two pieces: the state and the behavior, but then it can sort of delegate this third piece, which is the markup and say, "You know what? I don't really care about, specifically what I have to render." I don't have an opinion about that. You just give me a function and I'll give you my state and possibly, some behavior callbacks and then you can tell me what to render. I'm like a component that I have two of those three pieces. I don't have the markup, you just give me a function, that I will call when I need the markup. ROBERT: That's really powerful. MICHAEL: Yeah, exactly. I can have all three in one place or I can also with this component model, just delegate one piece or even two pieces, using these kinds of patterns to other components, so it's really nice. ROBERT: I'm always have to come back to this because this is where I kind of cut my teeth in the frontend world. I feel like render props are very similar to the yield pattern in Ember, where you can yield out a component and place it anywhere inside that template block. I think it's really similar. Because we have a large base of Ember developers that listen and they needed a draw like a parallel, I would say that's almost a parallel. I might be off on that. Taras, would you agree with that? TARAS: Yeah, it's very similar. There is one little 'gotcha' with render props in React, which I think Ember deals with a little bit more gracefully. I do use React all the time now. I use it much more often than I use Ember but -- ROBERT: Same. TARAS: Yeah and I'm kind of curious, Michael if you would think about this. Because there are certain things that, for example, JSX does, like one of the attributes of using render prop is that you want to pass stable functions, like something that is actually defined in init hook, so you're not necessarily recreating a new identity for this function every time that you pass into the render prop. Is that right? I think for someone who is might not be familiar with this, it's a little bit counterintuitive because it just kind of like, you just pass something and then you later realize, "Actually, I can't really do that because now your components were rendering over and over again." I'm curious like where can we kind of innovate in that? Because in Ember world, for example, it's really safe to use render props. If you're delegating to the context to do the rendering, you can very easily pass a block of template into the component and then the component will know how to render that in a performant way. My experience with render props in React was that the pattern in Ember is it's a very common behavior to delegate to the context of how the children of a component are rendered. This is the primary purpose of the yield in Ember and this is used by a lot of the components to provide APIs, so essentially, you're yielding, you're sending into the children function behavior that you want the developer to use while consuming your component. The parallel with React is that you would have, essentially a function, like you have a children render prop, which is a function that receives so that when a component is rendering the children render prop, it's passing some data into that function and it's invoking the children function and it's passing to it some data and then that data is being used inside of the children render function. Now, this mechanism works really well in Ember because Ember is using its own templating engine, so it manages every placeholder in the entire template as being passed into the component. It knows exactly what has changed in the function. Looking at that, the value just passing through component as a whole thing. It's actually managing each individual spot where the dynamic elements needs to be rendered. What that does is it allows it to manage the entire children function so you don't need to worry about stabilizing the render props. You don't need to assign them. Because there's also other challenges that kind of arise when you have to move the actual function that you pass into children. You have to move into the body of the actual component. Your ability to compose the state that is within the render function is kind of limit because you now have kind of broken up into different places. I'm a little bit curious what are your thoughts about this? And if there's any innovation that's going to require or improvements that will require in the way that React handles render props. ROBERT: I definitely remember seeing some tweets from you, Michael about this, like very recently. MICHAEL: Yeah, just yesterday in fact, I was talking about this on my Twitter. First of all, thanks for the question, Taras. I appreciate it. I think you kind of nailed it with the difference between Ember and for example, just JSX -- Handlebars, really and JSX is that Handlebars is not JavaScript. Handlebars is a language of its own, really. As the implementers of that language, the Ember team or the Handlebars team has complete control over how things work. For example, when functions are allocated. If they have a yield block, for example, that yield block does not have access to things like JavaScript Scope. It really is just a block within the templating language and so, they can decide when they're implementing that language. They can say, "We're only going to ever allocate one function for this yield block." JSX on the other hand, it really is just sort of some syntax sugar over JavaScript, which is nice lots of times because you can use things like JavaScript functions scope. You can do things like refactor it, like you would any other piece of JavaScript and pull that function out into its own variable or something like that. In a lot of ways, it's more flexible but with that flexibility comes this extra concern of what happens with the prop passing and it's a real concern but I don't think it's as big of a problem as most people have heard or might think it is. The real problem, the root of the problem is that if you have a pure component in React, the pure component is optimization tool in React, if you find that your component really is a pure component of just a pure function of its props and state, and that it will never render anything different, if it receives the exact same props and state, you can declare that that component is a pure component. Instead of just a regular component, it's now a pure component and so, it will actually opt out of the render cycle if it receives the exact same props and state on subsequent render. By exact same, what I mean is like identity triple -- ROBERT: Yeah. MICHAEL: -- Same. That's an optimization tool that you can use in React to say for example, maybe I've got a component and for some reason, it's always receiving the exact same props and it's rendering a lot. I can say, "You know what, React? Don't even waste your time re-rendering this component and doing the reconciliation around it and everything like that. If it receives the exact same props, don't even waste your time. This is a pure component. It received the same props. It's going to render the exact same stuff as it rendered last time, so it will completely opt out of the render cycle," so React won't even call the render method, won't even bother doing the reconciliation for that component or its descendants. It's actually a really, really nice way to get a little performance boost in that situation. ROBERT: Interesting. Does that mean, rather than passing some JSX that returns out an anonymous function, you would rather have like a pure component over that? MICHAEL: All it really means is that when you identify a place in your app where this is happening, instead of extending React component, you can extend React.PureComponent and now you component opts out of the render cycle. ROBERT: Gotcha. Because I see a lot in React applications, it will just return some JSX out of anonymous function, kind of think, Taras was getting at, when each re-render happens, it's recreating a new function and all of it were done inside of it, from the JSX because it's just a new function that's being bound each time. I think my takeaway from that and correct me if I'm wrong, is don't pass JSX and an anonymous function or I guess, from your tweets yesterday, that's kind of a premature optimization. Maybe, not pass as anonymous function but pass as pure component. MICHAEL: I hadn't yet gotten to directly addressing Taras's concern but the idea is -- ROBERT: -- Jumping the gun. MICHAEL: Yeah, it's fine. If you do have a pure component, that is when you're going to have a problem with this render prop pattern because you can't pass a render prop to a pure component. They just don't go together. Well, sorry. I should actually qualify that. You can pass around a prop to pure component but you need to make sure that it is always the exact same function, otherwise why are you making this thing a pure component, so there's a little bit of a problem there. I actually wrote the documentation on React's website on render props and there's a little caveat section where I discuss how you could get around this, you could convert it into an instance method or something else but then the concern at this point and this is why I said it's not such a huge problem because we're getting very, very specific now. Let's assume that we've got a pure component that is the child that we want to render and it accepts a render prop and that render prop depends on state and/or some sort of scope that it needs in the render method. Now, we've got a problem because we need to generate a new function in the render method and the fact that we're generating a new function and passing it to a pure component means that we are essentially negating all the benefits of extending pure component in the first place. First of all, in order to experience the problem, you have to get very, very specific and it's not easy to actually get into a point where the problem manifests itself. But then for the second part, fixing the problem is actually not tricky, so the way that you would fix this issue, there's a couple of ways to fix it. The most common way, I think to fix it would be to just say that pure component, let's just move that down one level and we'll put it inside the render method of the component that takes the render prop. The component that takes the render prop is no longer pure but the pure component has dropped down one level and we can still get all of the benefits of a pure component and again, its whole descendant tree lives underneath it. ROBERT: That make sense. MICHAEL: So, we can still get all the benefits of having a pure component, while still being able to use the pattern. But again, just getting back to what we were saying at the beginning. The render props is just one example of an advanced pattern that actually lets you delegate one of these three pieces to somewhere else. It's just one pattern. It's not like there are others as well. ROBERT: Yeah, so getting back to what is a component, is there ever a line that's drawn, like when does it stop becoming a component and it becomes something larger. MICHAEL: It's actually interesting because for a long time, we didn't have a component model on the web and I think -- ROBERT: It's very true. MICHAEL: -- still, like we mix to all three things together in our jQuery code. It was just like there was some state mixed in with some markup, mixed in with some behavior. It was all kind of mixed into one place. ROBERT: Nice plate of spaghetti. MICHAEL: Yeah, exactly. As soon React came along and actually gave us a real component model that really worked where we could actually identify these pieces, then all of a sudden, everything is a component and you really can make if you want, like if you really wanted to, you could make your entire application out of components. It could just even behavior stuff like, "I want to fetch some data," that could be a component or, "I want to listen to the window scroll or the window size," that could be another component. "I want to render an image or a bit of text or do some measuring or I want to do some parsing of some data or something like that," all of this stuff could be represented as components if you wanted it to. Of course, you can still extract those functions out into their own bag of utility methods and lots of times when I write a React Apple, I have a little bag of utils and I'll go and reach in there and grab those as I need them. But for the most part, most of my React apps are just components all the way down, so there's not much that I can't do with a component. The cool thing about that is what do you get when you have components, where you get reusability and sharability. I can make a component and I can just share it with you, Robert. I could say, "You want a component for listening to the windows size? Here you go. Here's the components. Got to render --" ROBERT: Drop it in. MICHAEL: "-- It will give you the size when you need it," so that ability to share code is, I think super important. ROBERT: Yeah, I think so too and it really helps you build applications rapidly because you can just start dropping these little components that are contained in composable throughout your entire app. I guess, I'm still clinging onto like there is maybe a line that is drawn and I think from the React community, there were a couple of terms coined called the container component and the presentational component, in which I immensely mapped those to basically being synonyms for controller and view. It's like the container components is kind of like a controller, like it delegates the view... Or decorates the view, not delegates. And the presentational component is just like we're talking earlier -- pure component. It's just taking props and rendering that. Is that fair to say? MICHAEL: Yeah. As far as I can tell, that's a pattern that was first talked about by the redux community, specifically I think Dan is the first to discuss that that pattern and it's a pattern that I think can work well. I haven't ever found it to be especially useful in my code but I can see how other people could like it for their code. I really just think it has to do with how your brain works. If you prefer structuring things like that, if you prefer like the vast majority of your components to just be these little view layers and then your main container components to hold all of the logic, I want fault you for that. I'd say, that's fine you can build your app like that. But I do think that when you're thinking about components like that, you are thinking about the much less like these miniature applications. Basically, in my opinion it's kind of a false separation. It's a separation that doesn't really need to exist because essentially, the thing that I really love about these components is you have encapsulation. You encapsulate everything. As soon as you adopt this pattern of containers and essentially, just these presentational leaf nodes, they're not as useful on their own. They just encapsulate some of the rendering logic. ROBERT: That's very true and they're not reusable. I mean, it's very, very hard to make those reusable. MICHAEL: Well, yeah. Most of the time, they're designed to be used with a very specific container. It is like, "Why couldn't we just put that in a container." Like I said, I really don't fault anybody for using them. It's just not how my brain works. I tend to think more about components as if they were these miniature applications and they're going to be useful on their own for the most part. One place where I have started to do that, the fourth thing that your components can encapsulate is style information, which is really just kind of the markup but it's the fourth thing and I think that I've really started to employ that kind of pattern when styling comes in. But it's not for this separation of containers and leaf nodes. It's just because I would like to encapsulate some of the styles down at a lower level or be able to reuse some of the styles down at a lower level, so that's when I'll typically start breaking up one of my components into multiple kind of tightly-coupled components but it's just for the sake of the styling, not really in any of the control flow or the logic. ROBERT: Right. When I first got into doing React, I was first like a little befuddled and then, I fell in love. I was like head over heels. When I hear about separation of concerns, it's always talked about like we need to separate HTML, JavaScript and CSS. They're all different things. They just need to be separate. I understand that. I kind of come from there but for me, my personal opinion is coming from the context of single-page apps, there is no feature that you can ship without the three. I don't think there is a complete feature that exists. Sure, there's edge cases that's like a blanket statement but I think those lines of separation is way more blurred these days and I think that's what React just unlocked. That's kind of where all of this is sort of rolling downhill and it's not a train. It's really powerful to be able to encapsulate all of those things together and then just think of your UI as these components. That's why we call them components. They componentized. Like when I have a butt-in and I drop it on the page, I don't want to have to go and make sure that I have the right class that's wired up in some other file. I can just drop the button in there and it's going to do its thing. I can pass the props, it'll change it, that's fine. It lives within itself. MICHAEL: Yeah, I would say you're absolutely right. You can't ship anything meaningful without having, at least some styling in there, unless you're shipping very, very basic behavioral style components. It's kind of one piece, I think like the React components are able to encapsulate their own styles but there's no, I guess officially recommended way to do it, which is where I think React get some of the critique, like some people come in and say like, "There are a million different ways to do styling in React and therefore, React is supposed to something like --" I guess, yeah, some of the other frontend frameworks have like, "This is how you do styling in our framework." ROBERT: Right, like the lack of convention. MICHAEL: Yeah, exactly. It's a blessing and a curse, though. If there's a lack of convention, it's harder for newcomers to know exactly what to do. ROBERT: Yeah, or like what's best for their use case. MICHAEL: Yeah, exactly but then on the other side, it's kind of a blessing because people are free to experiment and they don't have to feel like if they're experimenting, they're going sort of against the grain of what the community has already accepted to be the answer. I think that freedom to get out there and experiment is really valuable as well. ROBERT: You can see but I'm nodding. TARAS: I'm just curious what your thoughts were. This Suspense API is something that's... React kind of lead the way with components and now, the changes that are coming in with Suspense API coming in and it'd be great, if you can, are you able to explain a little bit about what it does for people that are not familiar and I'm curious what your thoughts about it. MICHAEL: Yeah, for sure. The Suspense API, I think is actually, with regards to what we've been talking about, with the encapsulation of markup, state and behavior and possibly styles, I think the Suspense API is kind of the React teams attempt to sort of encapsulate or generalize, at least one more thing, which is asynchronous behavior. The truth is, the most common async behavior that we know of, that most people are familiar with is a fetch, a data fetch -- you go and fetch some data. But there are others, there are things like loading of images and animations and navigation and things like that, where you have some time that passes in between when you initiate an operation and when you're actually able to render as a result of completing that operation. How do we manage or how do we generalize that and how do we think about it? The Suspense API is basically a way to declaratively say, "I need this async operation to be done." Let's just use the example of a fetch. I need this fetch. I need to have fetched this data in order to render this view and don't even attempt to render this view, unless the data has been fetched. Before the async API or Suspense, as they're calling it, you would basically have to manage this asynchronous behavior yourself. You would basically have to say, "Go and do the fetch," and while we're doing the fetch, maybe I'll set a loading flag in my state and say, "Loading is true," and then when the fetch gets back, I'll say, "Loading is false," and then I'll render. Maybe, while loading is true, I'll show like a spinner or some loading dots or something. What the Suspense API allows us to do or what they're hoping to do, again it's all very like... I don't know if I made this clear. It's still very, very, very, very early days for this API and I don't actually know when it'll be ready. But anyway, the idea is to be able to say -- ROBERT: Would you say the Suspense is killing the community? MICHAEL: The suspense around suspense. ROBERT: A terrible pun. MICHAEL: Anyway, the API is basically just a more declarative way to indicate where this asynchronous stuff is happening and give React sort of clues, if you will, to say, "There's some asynchronous stuff happening here, just so you know." That has many applications in the real world. Let's say for example, you were navigating in a master detail view and you're tapping down the master view and loading these detail views, if you tap a master view and you haven't yet loaded the information for the detail view, instead of sliding to the detail and showing the data still loading there in the detail view, you might want to show some sort of loading indicator while you're still in the master view. Then, if it's taking a while to load, they can actually select something else from the master view and in that case, you would cancel the old fetch and start another fetch. It's just supposed to make things like that, kind of feel a little bit more fluid and a little bit more intuitive to the programmer, so you don't have to think so hard about managing a lot of that complexity in your own head. ROBERT: Yeah. By the way, I love the mobile first language that you used. You tapped here, you tapped here, that slides in. MICHAEL: Yeah, for sure. It's all we're building these days. ROBERT: Yeah, it's very true. TARAS: It's interesting because the Suspense API, you wouldn't really imagine it to be within the scope of a view in a traditional sense, to [inaudible] but considering the scope of a component in React, it makes sense but I think people might not imagine as being something that would become part of core, potentially in React. I'm curious like what do you think other areas of React and I'm glad that the scope of components in React is so broad because it kind of opens up this question to be pretty much anything in React ecosystem. But is there an area of React building or the aspects of applications that you would like to see an improvement in or some kind of a change or something that hasn't seen the right amount of innovation in the same way that we've seen in other areas? MICHAEL: Basically, is there a place where I would like to see the React ecosystem improve? TARAS: Yes. MICHAEL: I know this goes kind of contrary to what I just said but I would like to see a little bit more cohesiveness. I feel like in some ways, the freedom is good but I also feel like in some ways, for the last couple of years, we've been just sort of like rehashing the exact same old problems again and again because React really made everything else so easy, like a lot of the stuff that was hard about building web apps, just got really easy when React came along. I'm not saying that because I have React training company. Of course, my livelihood right now depends on React but honestly, if it wasn't for React, I think I probably would have quit and done something else because it was actually getting really, really difficult for me. I was trying to build an app in Ember before I started with React and I just couldn't do it, you know? I just couldn't get the level of polish that I wanted in my app and get all the bugs out and get it working exactly how I want it to. It frustrated me, actually that I've spent a lot of time. I spent about 18 months, about $100,000 of my own money, just down the drain trying to build this app, trying to get it out the door and I wasn't able to finish it off. At the end of the day, I really started to question like, "Was it me? Do I just suck? Am I not a great developer? Is that the problem?" You really have to start asking ourselves hard questions like that when you put everything you have into something and it doesn't work out and then React came along and I was like, "I was just using the wrong tools." The tools were the problem. It wasn't me. There is a different way to think about this about building stuff. I thought the way that I was doing it was the only way that existed to build things but it turns out, it's not. I used to not understand what were people talking about when they were talking about functional programming or what do they talk about when they're talking about composition, solving problems with composition, instead of inheritance. I didn't even understand what that meant. But all I knew is really smart people would say stuff like that and I was like, "What are you talking about?" Now I feel like, because of React, I've gotten it. Again, to get back to your question, Taras, React made a lot of the stuff that we used to worry about, that we used to think about. It made it easy and so, we could build amazing things now a lot more easily. But now, for the last couple of years, I feel like we've just been sort of rehashing a lot of the same stuff. I would really like to see us, as a community sort of tackle the next level problems. I think the React Suspense stuff is definitely getting there. That's a problem that I really don't see anybody else sort of address, which is how do I make it easy to deal with the fact that applications by their nature -- these networked applications -- are asynchronous. How do I deal with that in a declarative way? That's why I'm encouraged by that work because I do think that it's kind of one of the more forward thinking things right now that's going on in the React community but I would like to see us in general, sort of like get past talking about styling and get past talking about service and rendering and move on. ROBERT: Right and I'm going to assume you have this really unique experience since you do a lot of trainings. I follow you on Twitter and it's just always talking about where you're flying to and who you're training, so the things have to come up there where you see these things in pattern over pattern over pattern. MICHAEL: Yeah, exactly. I see like a lot of and this again, gets back to Taras's question. I train a lot of people who are very new to React and I see people who are new to React, they really don't have a ton to go on besides just like blog posts and Medium pieces and podcast like this one and who am I? A lot of people in their React community don't even know or care who I am. It's like, "There's a guy out here who are saying stuff about React. Maybe I should listen to him. Maybe I should listen to somebody else," and it's confusing. It's confusing, I feel like, for people who are just getting into React. It's confusing. Like I said, experimentation is good but I guess, I wish the experience of coming to React was a little bit more like the experience of coming to Vue because -- ROBERT: Oh, like it was a beaten path. MICHAEL: Exactly. I don't actually think there's not a whole lot about the Vue technology that is compelling to me and let's not dig on it. It's just -- ROBERT: A personal preference? MICHAEL: Yeah, exactly, just preference but I do think the thing that is very compelling about the Vue experience is just the cohesiveness of it all. You go to Vue and there's like a way to do server-side rendering with data fetching and styling and -- ROBERT: They have a CLI and -- MICHAEL: And a CLI and a component and all these stuff. Yeah, and a router built right in. Anyway, I think that's a way that the React community could improve. I don't know if that'll ever happen because the React community at heart is artists and hackers and those people are traditionally very reluctant to be corralled and like I said, it's a blessing but I think from the perspective of people who are new to the community, it does tend to cause some confusion. TARAS: I want to add to what Michael is saying. What's interesting and I'm sure Michael sees this in his training but the kind of people that use React is very diverse. There's this kind of original group or there's kind of mentality that prompted the early adopters of React and now, we're seeing these companies that are traditionally enterprise-y with MSE backgrounds and coming into React. It's really interesting to see all this kind of worlds collide and then see what's happening as a result. It's definitely interesting on what's going on now. ROBERT: This is an excellent stopping point. I really agree. I come from Ember background so I would like to see a little bit more convention but I think it's okay. It would be nice to see that. Thank you, Michael for coming on. Is there anything that you would like to give a quick plug for and where people can reach you? MICHAEL: If you want to support the work we're doing, you can sign up for one of our upcoming workshops. We've got one right now on ReactTraining.com. We've got a workshop coming up, actually in my hometown of Carlsbad. You can come out here in July and hang out with us and do some React training. We got a really awesome host here who's right here in town. We're doing some React training workshops on July 25th through 27th, I think and then, other ways that you can support what we're doing is publish in all my open source code at GitHub.com/ReactTraining or you can follow us on Twitter at Twitter.com/ReactTraining or at my personal account at @MJackson -- Michael Jackson. ROBERT: Awesome. I really appreciate you taking the time to come on. MICHAEL: Yeah, thank you so much. It's been a pleasure. ROBERT: This is a great talk. Cool. Thank you everybody for listening. We are The Frontside and we build UI that you can stick your feature on. If you would like to give us feedback, you can always reach out to us on Twitter at @TheFrontside or you could email us at Contact@Frontside.io. We're always looking for any new topics or things you would like to talk about or things that are interesting to you. As always, thank you Mandy for producing our podcast. It's @therubyrep on Twitter and on June 28th, we're going to have Chris Martin on to discuss blockchain development.

Mindfulness Mode
317 Discover Your Mindful Blueprint With Michael Neeley

Mindfulness Mode

Play Episode Listen Later Apr 30, 2018 32:01


Michael Neeley is a podcaster and an entrepreneur. He's a business coach and he empowers other entrepreneurs to live the lives they've always dreamed of. He's the host of the podcast, 'Consciously Speaking', and also his new podcast, 'Buy This, Not That'. Michael used to be a knight in shining armor; he was an actor who spent a good portion of his career on horseback before starring in a couple of soap operas and some independent films. Michael's son, Tristan, was born back in 2002, and at that time Michael decided he wanted to leave the smog of Los Angeles and settle in an area with clean air and clear skies. So Michael made a transition and has moved to a role where he enlightens others as a mindfulness business coach. Contact Info Website: www.MichaelNeeley.com Podcast: Consciously Speaking Podcast: Buy This, Not That Event: Transformational Business Event - Your Authority Blueprint Live(Listen to the interview for a $100 Off Coupon Code) Conversation With Michael Bruce: How do you get grounded in your life, Michael? Michael: For me, meditation plays a big part in it and it's not about like sitting down on a cushion for 45 minutes at a time. It's more like, uh, you know, while I'm going for a walk, if I'm walking the dogs, I can use that as a meditation. It's a matter of fact. It was so cool. I walked them yesterday, I took them over to this little park area that we have here near my home and I unleashed them and let them run and I laid down on the grass and stared up at the sky and meditated for about five minutes. It was total bliss and just little things like that where you can relax the mind and let go of all of these crazy monkey mind thoughts that are running through our heads about our business constantly. If you're a solopreneur or even about life in general, you can get caught up in all this stuff instead of just, OK, here I am. I'm just a human being. Bruce: Your son Tristan was born in 2002. Has He inspired you to be mindful? Has He taught you anything about being grounded and being centered? Michael: Well, Tristan is my constant teacher every day and you know, he's my why. He's the why of what I'm up to in the world and that's the part that I've got to bring mindfulness back to. If I get too caught up in doing the work and I don't spend the time with him; he's the reason that I'm doing the work. And so if I don't take the breaks to spend the time with him, then it kind of defeats the purpose. And so yeah, he's a constant teacher to me. Bruce: How will mindfulness play a role in your upcoming event that you're doing? Michael: A lot of people look at business and they don't see the correlation of how mindfulness plays into that and I know maybe in larger corporations it's less relevant in the bigger picture. Certainly on the smaller scale and when we're talking about the people that I'm attracting for my event, which are visionary Solopreneurs, as I call them, people who are in business for themselves, the mindfulness piece is often the difference between success and failure. What I mean by that is that we get in our own way. We get caught up in either the minutia of the work or we get caught up doing the wrong things because we're looking for a sense of, you know, checking off the list, tick boxes instead of really being mindful about, OK, wait a minute, let me tune in here. What do I really want? What is going to be the best for my business and how can I move forward in a way that's conscious and fully present? Bruce: Tell us about some of the speakers that are going to be at your event. I know it's called, Your Authority Blueprint Live. Michael: It's going to be a rockin' event and we're going to have Jay Fiset there, another fellow Canadian. Jay does work with a Mastermind To Millions. I didn't realize how conscious Jay was and how mindful he was until recently when I had him on my show. He's just really a cool guy. So Jay's going to be there. We've got Brady Patterson from Success Road Academy, also a Canadian company. Brady is going to be there. Uh, we're going to have Tiamo De Vettori, who is a singer, songwriter. He's going to be sharing some inspirational music with us. [Tiamo was recently named L.A. Music Award's "Singer/Songwriter of the Year" & San Diego's "Best Songwriter] Tiffany Largie is going to be there. I mean we're going to have a wonderful lineup of some great talented motivational speakers to help people break through. Melanie Benson, another person who's really great with mindset is going to be there sharing some of her wisdom and expertise to really help us move beyond these blocks that stop us. And then of course, where the authority blueprint comes in is we're going to share the business side of it is how can you create a name for yourself in the industry that's really gonna catapult you onto the scene in a big way. And that's the business promise of it. We're going to show you how to build that blueprint. Bruce: On your podcast, Consciously Speaking, you help people wake up and you consciously create awareness, but I'm curious about your other podcast called, Buy This, Not That. How did that come about? What's the story? Michael: Well, you know, that's an interesting piece as well. We talk about our clients, you know, running into certain situations or questions and for me the questions kept coming up over and over again, like, well, what's the best mail service provider, email provider or what's the best webinar hosting platform? And I found myself answering questions over and over again, like the same questions and I thought, you know there are a lot of solopreneurs out there struggling with these same things. What if I were to .... [Tune in to the Podcast to hear more from Michael Neeley]

The Drama Teacher Podcast
Shakespeare on a Shoestring

The Drama Teacher Podcast

Play Episode Listen Later Mar 6, 2018 31:12


Episode 202: Shakespeare on a Shoestring What does Shakespeare on a shoestring mean? It means no set, no elaborate costumes, all sound done onstage and life. Just like Shakespeare would have done in his day. If you're looking for a doorway to Shakespeare, if you're looking for a show to tour or take to a festival when you don't have any tech at your disposal, then the shoestring philosophy will be right up your alley. Tune in to learn more! Show Notes Shakespeare on a Shoestring: Cymbeline   Episode Transcript Welcome to the Drama Teacher Podcast brought to you by Theatrefolk – the Drama Teacher Resource Company. I'm Lindsay Price. Hello! I hope you're well. Thanks for listening! This is Episode 202 and you can find any links to this episode in the show notes which are at Theatrefolk.com/episode202. Woot! Woot! I am thrilled to have this conversation that I can present to you and we are going to share a great concept. Well, I'm not going to share it. Our guest is going to share it. It's all about Shakespeare on a Shoestring. Michael Calderone is who I'm talking to, and we have actually just published his play – Shakespeare on a Shoestring – Cymbeline! – here at Theatrefolk. So, we have the concept which turned into a play which turned into a published play, but we're focusing on the concept – the concept about how we can do Shakespeare on a Shoestring and how you can do Shakespeare on a Shoestring. I am always, always, always up for a way to make Shakespeare accessible to students and to open that door to his work. So, let's get to it! I'm going to see you on the other side! LINDSAY: Hello everybody! I am here with Mike Calderone! Hello, Mike! MICHAEL: Hi there! LINDSAY: So, I like to start off by asking for you to share where you are in the world right now. MICHAEL: I am at the campus of Hopkins School in New Haven, Connecticut. LINDSAY: Awesome. And what do you do at Hopkins School? What do you do? MICHAEL: I am one of two drama teachers here. I direct. I teach acting classes, drama classes, and public speaking. LINDSAY: Very awesome. Let's talk about theatre experience first. When did you start really connecting to theatre? MICHAEL: I did not start connecting to theatre until freshman year of college. I was looking to go to a restaurant school for college, but didn't have the money to do it, so I went to the local community college, found theatre, and from there I went to Rutgers University and became a Theatre Bachelor of Arts student. LINDSAY: Aha! So, it was sort of happenstance that you fell into it. MICHAEL: It really was. LINDSAY: Why did you stay with it? MICHAEL: Well, it was the love of the theatre. I guess I was always performing. I didn't do anything in high school at all and I think that's one of the most ironic things about this – about my career. It's that I never did it in high school. It was in college that I found it and fell in love with it. Shortly thereafter, when I got into Rutgers, that's when I fell in with the class that was the Shoestring Players which was an undergraduate performance company that spent a semester developing a show based on international folktales. I went to the audition, I got called back, and then I was not cast. But I went back as the percussionist which is basically the onstage live Foley artist punctuating the performance. With that job, that's where I went from we were the first company to go to the Edinburgh Festival way back in 1989 and then performed with them professionally, started teaching with them, started directing with them. From there, when I was looking for a job to pay the bills, I started teaching. LINDSAY: Wow! You just segued right into our topic for today… brilliantly! MICHAEL: I listened to your last podcast! LINDSAY: I like a good segue, man! You know, it's all about the ebb and flow. It's all good. It's all good! Yes,

Made It In Music: Interviews With Artists, Songwriters, And Music Industry Pros

We are celebrating our 100th Episode by bringing you portions of the best podcasts selected by the FCM Team. Stacey, X, Jerricho, Logan, and Seth are all interviewed regarding their favorite FCMS episode and share why that guest was the most memorable for them. We want to thank all of our listeners for their continued support. We will return all new and all fresh on Monday, March 26th with our MADE IT IN MUSIC Podcast.————————————Episode 100Full Circle Music Show– Hi, I'm Seth Mosley from Full Circle Music, and man am I excited, this is episode 100 of our Full Circle Music Show podcast, and not only that, the day that we're making a massive announcement. And what is that announcement? It's that we are re-branding. Yes, we're changing the format, the title, everything of our podcast to make it even more packed with value, for free, for you guys. And the new title, drum roll please, is the Made It in Music Podcast, by Full Circle Music. It's resources for music makers just like you who wanna go full-time in music, and stay in. So I just wanted to do something a little special on this episode to go along with the announcement of the Made It in Music Podcast, episode 100, and what we're doing this week is we're bringing you a best of episode. We picked our very favorite moments from the Full Circle Music Show and broke down just some really key points, things that we think you would get a lot out of, things that we personally got a lot out of. I'm Seth Mosley, thank you so much for listening. Here with Stacey Willbur, VP of publishing and A&R here at Full Circle Music. Man, I loved that you picked the Ginny Owens episode, 'cause it was one of my favorite not only podcast episodes, but what a lot of people who're maybe gonna go back and listen to this clip don't realize is that it was recorded at one of our Full Circle Academy songwriter retreats. And man, if I haven't told you already, the people that you have relationships with that you've been able to bring in to pour into our students is just absolutely incredible. So Ginny was one of those, she was at our last one, and I feel like I probably got more feedback on her than a lot of speakers that come in. That's where this podcast was recorded at. So what stood out to you about that, what made you pick that as your favorite moment?– Well, it was my favorite moment because, obviously 'cause we were there, we were actually in the moment, it was an experience. It was Ginny talking about very simple things, three key elements of songwriting. But what I loved about it is that she weaved her own story into all three of those elements. I loved hearing her story wrapped up into all of that.– Yeah, she talked about it being, something that I had not heard, and I think you said the same thing, that she compares songwriting to being a journey with a friend.– A journey with a friend, that was like an a-ha moment, I think, for so many, because I don't think everybody looks at it that way. It's a job, it's this, but as a friend, and the closer you get to a friend, you get to know each other, you get to know their hearts, you get to know their stories, and the same thing with songwriting. The more you spend time… Writing every day, getting to know your craft, understanding the different elements of songwriting, the better you become and the better you know yourself as a songwriter.– Yeah, and she talks about how it is a sought after treasure, too, I thought that was such a cool way to put it. What did she mean by that?– Well, it was interesting 'cause she said it was a sought after treasure pursued by an enemy. Which, the enemy, as she describes, are distractions. The distractions in your life that keep you from doing the thing that you love doing. So what are those things and how do you keep those distractions from keeping you from doing what God's plan and purpose is for your life, which is songwriting.– Yeah, and I think, man, she just… There's podcast episodes that we've done that I feel like I just kinda wish I had like a notepad the whole time, 'cause she just kinda drops quote after quote after quote, and one thing that you shared with me, that I totally agree with is that good is the enemy of great, and perfection is the enemy of creativity. That was, I thought that was brilliant when she said that.– Yeah, and I think, especially in this industry, we hear a lot of, oh, that's a good song, that's a good song, that's a good song. And we tend to leave it there, and we don't encourage each other to strive for the great. I think striving for the great is harder. ‘Cause it takes going back and rewriting, it takes time and effort. The good is, yeah, this is good, you know. But the great, I think, is you dig it in a little deeper. And she really shares that in the podcast, she shares the struggles that she went through as an artist. And just in her life personally to get to that point.– Yeah, so good. Well I'm really glad you picked it 'cause it's one of my favorite moments too.– Awesome.– Here's a clip from Ginny Owens on the Full Circle Music Show live from the Full Circle Academy songwriter's retreat.– [Ginny] I want to offer, just based on my experience as a songwriter over the past billion years, I wanna offer three key elements of a life of endless songwriting bliss. So three key elements to maintaining a songwriting life. So the first one is, songwriting is a journey with a friend. Show up every day so that you can go a little further together. Songwriting is an art form. The more you know the rules and master the skill, the freer you will be to let your heart guide the process. And, songwriting is a sought after treasure guarded by an enemy. In order to capture it, you must fight every day of your life. Listening, like, two different types of listening that I call active and passive listening. So, I really love pop music, so active listening for me is like, when I work out in the mornings, just rolling the Apple, new Apple, like whatever, pop playlist, or what they're playing at Apple List or Spotify, you know, playlist, and learning. What are they doing in the songs that you're hearing that you like? How are they creating hooks? What do the rhythm things sound like that they're doing. Things like, Chainsmokers came along and they sort of created this chorus, where you don't have to soar up in the top, you just do this, like, ♪ Baby hold me closer in the backseat — ♪ I probably shouldn't be singing that at the Christian — But you know, it's just this tiny little space of a chorus. So there are trends that you start to see as you listen to music. If you're a songwriter-ish type person, more of a James Taylor type person, then you can listen to current people that do that, like James Bay or John Mayer. Hear what they're doing, sort of study their technique. But the other thing is passive listening. And what I guess I mean by that is falling in love with music. One of the things I've recently discovered about myself is that I'm too busy thinking about… Analyzing songs, and I actually need to go fall in love with music again, 'cause it's just too easy to be critical. And so what I've learned is, probably the easiest way to do this, which is not something that streaming really lends itself towards, but to go get people's albums. And just listen to the full album and continue to immerse myself in it, and be patient. ‘Cause I'm sure, maybe some of you guys are like this too, I'm so impatient. I'll listen to half a song and then I flip to the next song. That does not create and inspire love for music. I think those things are key for deepening our skillsets, growing our skillsets, educating ourselves. And then there's another aspect, just as we talk about kind of this skill of songwriting. It's really simple, but I think it's really important, especially for new writers, and I kind of call it the accessibility scale. So on one end you have the more cerebral, the more personal kind of songs. Those are the songs you write for your grandma, or your brother, or a wedding. And then on the other end are the more super-commercial songs. So like, Bon Iver is super cerebral. Taylor, super commercial. Andrew Peterson is pretty cerebral. Tomlin, Jordan Feliz, super commercial. And so the more cerebral a song is, the more it's kinda written to please the writer. So most of those things fall kind of more in the middle, they're not generally purely one or the other. But the more cerebral, form matters less, it's kinda in the writer's head, and obviously the more commercial a song is, the more singable it is, the more melodic, the more many people can kinda follow what you're doing. You gotta know the difference. If you wanna write commercial, study it, learn the techniques, listen to the Full Circle podcast every week, because there's an art to expressing yourself that way. But if you're gonna write about family, if you're gonna write something super personal, don't let that out for critique, 'cause you don't want to hurt yourself in that way. You know what I mean? Protect the things that are really personal to you. And the more you kind of know the skill and the art of songwriting, the more you're gonna know how to do that. Skill, taking the journey, ultimately helps with our biggest challenge as songwriters, which is fighting for your songwriting. And if you don't believe me, I bet you do. Everybody probably believes that it's a fight. Songwriting is a treasure that's guarded by an enemy. And so in order to capture it, you must fight every day of your life. Not to be all dark and wage war-ish, but, we gotta wage some war. The hardest part of songwriting is what? Songwriting. You know, you always got something else to do. Or there's always a voice in your head that says not to do it. And I promise, lest you think it only happens to new writers I have this happen every day. I've just finally learned, oh, this is part of it. This is what I'm gonna fight every day. And especially when you've been doing it a long time, you can kinda even get more in your head, 'cause you're like, what if I don't know how to do anything current? So if you give up, then the enemy will win. So what exactly is the enemy? I do like how Kevin Pressfield, who wrote the Legend of Bagger Vance, but he has a book called The War of Art which I would highly recommend you all read. There's some swearing, but read it anyway. But he calls the enemy resistance. And he says any act that entails commitment of the heart is a reason for resistance. In other words, any act that rejects immediate gratification in favor of long term growth, health, or integrity, or any act that derives from our higher nature instead of our lower, will elicit resistance. Resistance cannot be seen, touched, heard, or smelled, but it can be felt. And the more important – get this. The more important a call or action is to our soul's evolution, the more resistance we will feel toward pursuing it. Ouch. And resistance takes all different forms. Sometimes it's you, right? It's the lack of discipline. That's what it is for me, a lot. I just wanna do all the other fun things. And I wanna think about songwriting, really I do. But, maybe I'll get to it. That's why scheduling is so key. And there are voices in your head, and that's why scheduling and showing up every day is so key. It diminishes the voices, I promise you. Sometimes it's 'cause you got a eat, and so you gotta work. So that's also why finding that time every week and putting it on a calendar can be so awesome to do. Another key in fighting resistance is knowing the people who are in your space. Knowing the people who are awesome and can hold you accountable, like probably some folks you've met here, and learning the people who are not safe for you to play music for. Another way to protect what you're writing, and who the safe people are not, when you're fighting resistance. Now, for those of us who are believers, who are people of faith, we know there is a deeper resistance from an enemy that is full-on against you. And especially when it comes to pursuing a gift that God has given you to inspire others.– X O'Connor. I love it, we're here in the studio on this exciting day, episode 100.– 100.– Recapping some of our favorite moments from the Full Circle Music show, and… Tyler Bryant.– Tyler Byant, man.– Good choice.– Man, my favorite, dude, we sat down with him, I remember it was kind of last minute, I got a call early in the morning like, hey, I think we're gonna do some Tyler Byrant interview today. So I remember driving down, and I was super pumped, I'd loosely known him from being in bands around Nashville and I was like, I love this dude's music, I'm excited to talk to this guy. And to sit down with him, he's a young kid, you know, and he's just got his head on in a way that very few other artist, songwriters, any musical person does, he just realizes that hard work comes above all else, everything in life. And this guy, his band is successful, but not necessarily at radio. No real radio number ones, no nothing like that, but he plays hundred thousand seat venues. It's like, that blows my mind. And to just hear him speak about hard work. No one's gonna work harder for you than you're gonna work for yourself, so take every opportunity that you've got and just make something out of it.– Yeah, I love it, and I think he even shared in the episode something about, they do a lot in Europe.– Yeah.– And I think a fan, they were playing somewhere in Spain and a fan had like, tooken a night train like across…– Across the continent, literally.– The entire continent to get there, and they were so pumped about it. And you can just tell that when an artist is engaged, and the fans can tell that you really care, as the artist, they're gonna care.– Yeah, absolutely, and… that was something that he also spoke about a lot in this interview is relationship building. Not just with the people around you, but with the fans. The fans can feel that level of commitment that you have to them. But then on the business side, too. They've been around labels and all that stuff a lot, and I just love the mentality of, be honest with the people you're with. Even if it's a hard conversation to have with somebody, the honesty is gonna preserve that relationship in the future. I think he talked about them leaving their label to kind of go out on their own, and the conversation he had with the label after the fact, like, hey, you guys are still always on the list at a Shakedown show, come out any time, you guys worked hard for us, just, it's time for us to go do something else. And I love that mentality.– Yeah, and we went and saw them in Nashville at… Was it 12th?– 3rd and Lindsley.– 3rd and Lindsley, which is a really cool venue. And it was one of the best live shows I think I've ever seen.– Yeah, they go for it. It's so tight, but it's just raw rock and roll. It was a fun night, I hadn't been to a show like that in a while.– No click tracks.– No click, it's just guys on stage just going for it, rock and rolling. I loved it, man, it was so much fun to just sit there and just, be like, yep, these guys own it. This is great.– Inspiring.– Inspiring, for sure.– Well here's a clip from the Full Circle Music show episode with Tyler Bryant of Tyler Bryant and the Shakedown.– [Tyler] We've talked about it a little bit, but I come from a blues background, I learned to play from an old bluesman in Texas. Even as a kid, I was offered a record deal, and it was like, we're gonna set you up with other kids and we're gonna start a band, and I was like, no, man, I just wanna play the blues. I wanna make, like, I remember Lyric Street records gave me a little $10,000 check to go make some recordings. I think they were legitimately upset when I handed them back like three Freddie King covers that I had made. You know, it's like, what did you expect, man? And I still kinda have that mentality where, I don't know if you guys ever have dove into this on your show, I'm sure you have, 'cause it's something that I feel like a lot of artists struggle with. It's mixing art, something that really moves you, and commerce. Let's eat and let's survive, and so all we try to do in our band is have a little bit of both, you know?– [X] Yeah, yeah. So touring has been your bread and butter. Let's just talk about that, how do you get invited out on a AC/DC or Guns ‘n Roses Tour without radio, without big number one chart topping songs?– [Tyler] It's hard to say, honestly. I think one, you gotta believe in what you're doing, you have to be convicted every time you put on a guitar. Whether it's in a writing room, whether it's in a coffee shop. That's what, you know, I have kids ask me at our shows who have bands, like, how do you get on these tours, how do you get these shows going? And it's like, you literally play every show you get offered. Whenever I was starting out, I had a fake email account. And I was the band's manager, my name was like Sarah, or something like this, and I represented, this was before the Shakedown, I represented Tyler Bryant.– [X] What's the Spinal Tap manager?– [Tyler] Yeah, and it would, there was another time where it's like, I literally called the box office of the House of Blues. This is when I was younger, I called them every single day until they finally told one of the booking agents, this guy won't stop calling, he wants to play. And he called me and was like, dude, you can't call the box office and book a show. And I was like, but, can you book me?– [X] Yeah– [Tyler] And he's like send me some recordings. So I sent him some recordings and some videos and he put my band on for Dickie Betts. And then I called the Dallas morning news, and I was like, my band's playing, opening up for Dickie Betts of the Allman Brothers, I think you should come film it and do a story. And they did, and it's that kind of hustle that I think is, what I've learned that we have to do because it's, any time we've waited on someone else to do something for us we fall short, and so it's, I think those, it's funny because we were at CAA, the booking agency for a long time, and they did great things for us, and after about a year and a half of not touring as much as we'd like, we thought, let's make a change, let's move agencies. But we had such a good relationship with our agent that he'd become family, it's a guy named John Huie. And so we left. We were on the road supporting Billy Gibbons from ZZ Top and I get a call from Huie going, he's just like, I love you guys and I wanted to know if it would be okay if I pitched you for the AC/DC world tour. And, of course we said yes, but this is someone who's not our agent. So that's where… Maintaining relationships, and always shooting people straight, and even if it's a tough conversation going, like, I think we have to move somewhere else, because we're not getting the love here. They kill it with country acts out of Nashville, and I'm sure that the rock department does great, too. We just weren't getting the love that we needed. Because maybe what we were doing didn't move them there, but I think even when a relationship has to stop, it doesn't – professionally, it doesn't have to stop emotionally and I think that's, you know. We're all from the South and believe in Southern hospitality and shooting people straight even when it's a tough conversation, and I think that's helped benefit our band.– [X] Well I love that, because there's so many bands that we come across that are just constantly complaining about their teams. They're like, my label's not doing this, my manager's not doing this, we don't have our publisher getting songs on sync, our publicist is not scheduling – it's just excuses and complaining about people not doing stuff for them. And what I'm hearing you say is like, screw that, do it yourself.– [Tyler] Oh yeah, absolutely. We just made our own record, and I called a few of the people from Universal Republic after we got out of our deal, and it was sort of an, I think both parties were like, this isn't really working for us. We weren't giving them what they need to do what they do best, and they were like, you guys just aren't setting yourself up to win. But I talked to a few people from the label who were like, wait, you guys aren't with us anymore? It's like hey, listen, you're always on the guest list at a Shakedown show, you guys come out, thanks for putting in the work, man. Because it's hard to find people to work for you, and it's hard to find people who will work as hard as you will, so you have to do it yourself. Or at least, even like when it comes to making music videos or setting up photo shoots, or finding the direction. I feel like that has to come from the artist, because I feel like a lot of artists fall short when they're waiting on someone else to show them the direction.– Here at Full Circle Music studios with Jericho Scroggins.– Hey, hey.– Thanks for being on the show today, buddy.– Thank you for having me.– I love the clip that you picked, it was a Michael W. Smith interview, it was honestly one of my favorite ones to do. Why don't you talk just a little bit about what stood out to you from that, and why people should go back and listen to it?– Yeah. The initial part of it is how he was talking about the start of his career, and even how that's when he got married with Debbie, that was like in '81. So when the Amy Grant thing and all that kind of stuff, it was a very busy time for his career. And so they saw a bunch of marriages around that time falling apart. And so he does think it's hard for people to tour 200, 250 shows a year and keep a healthy marriage. So it was super cool to hear how he… One thing I didn't know about Michael and his career was, he was never away from his family more than two weeks. And it was just, like, mind-blowing to me thinking about that, just knowing his career and that kind of stuff. And so just how he goes through and talks about the priorities of that. You do have a career, but you also have family, and making sure they know where priorities lie and stuff like that, and his family always came above his career.– Yeah, and we get to interview a lot of super achievers on the show, so it's always cool to see that, you know what, they've not only got their stuff together on a career level, 'cause obviously Michael W. Smith's the top of the top, but he was really good about keeping accountability in place, as well.– Right. Yeah, that was definitely another part of it that I really liked, because, it's not only, like, when you go out and do your thing and that kind of stuff, still keeping a good group of, a team around you, that makes sure you're still doing what you're supposed to be doing. Whether it's heart-wise, faith-wise, even mind-wise, you know what I mean? Like making sure it's, even having them help him keep accountable to making sure he makes it home every two weeks. Or being a servant on the road, and things like that.– Yeah, and another really cool thing that I think you mentioned was this idea about talking to the younger you. What did you mean by that?– Yeah, there's this cool part where, it's the giving the advice to the younger you part. And it really stood out to me when he said, if I could tell the younger me, I would say it's not about you. And what he means by that is like, just earlier on realizing… Yeah, you're given these gifts and stuff like that, but realistically the gifts help other people, it's being a servant, making sure you're using the gifts for the right reason. Everybody wants to be successful, but it's like, how you wanna be successful dictates a different way in the way you look at it, and that kind of stuff, and that's his thing. Earlier on he looked at it a little bit differently, like, how many CDs does he sell, how good was the merch and that kind of stuff, and he realized pretty early on after that, he's like, it's not about that. It's not about you. Is he reaching the lives, is he reaching other people, and I think that goes across anything we do. The stuff we work on, even we don't go out there and tour with it, but it's still putting in the 100%, because at the end of the day, it's not about me.– That's right.– It's about that.– Yeah, that's good. Well here is a clip from our Full Circle Music Show episode with Michael W. Smith.– [Seth] Thinking back over all the years being an artist I think one of the things that I struggle with and a lot of young artists, or writers, or producers struggle with is the whole balance of being a creative versus being a good family man. How have you found balance over the years to kinda keep all of that together, what's the secret for that?– [Michael] Well, we made the rule, Deb and I, when this thing started really taking off, in the Amy thing, and then did the Friends tour, Big Picture tour, we started having children.– [Seth] So you were married early.– [Michael] I got married in '81 to Deb, so it'll be 35 years this year.– [Seth] Congratulations.– Thank you.– That's amazing.– [Michael] She's awesome. But we knew, I think we probably really knew, probably when I did the Lead Me On tour, which was… Probably the most successful, other than the Change Your World tour it was probably the most successful tour I've ever been a part of, 'cause we sold out arenas, me and Amy, all around the country, and in other countries, as well. And we just started seeing people in our genre and in other genres, when it came to being entertainers and all that sort of thing that marriages were falling apart left and right. And so we, I remember just having a talk with Deb and just going, you know… If we don't make some rules, there's probably more chances of us being a casualty than not. And we're not gonna be a casualty. And so we just made the rule, I'm not gonna ever be gone more than two weeks from my family, ever. Even if I had to cross the pond, and come back, and cross it again. And I was never gone from Deb and the kids for more than two weeks. Had a little aircraft, and I don't talk about that much, it was worth every penny, I thought, I've gotta get home to my family. And a lot of times I'd do a show and I would literally walk off stage, and got in a car, and I was on the jet and I was home at midnight and I'm driving carpool at 7:15. I did that for twelve-and-a-half years. And I think if you talked to my kids, I think, I think if you could have a private one-on-one, I think they would all say, we were more important to my dad than his career was. And now I got all these young bands, I got some of these young kids are all starting to come to me and ask me exactly what you asked me. And I think that's part of my role in the future is to sort of be a fatherly role and try to help kids. I just don't think you can do 250 shows on the road and keep a family together. And they say, well, we gotta pay the bills, we gotta make the house payment. My response is, then buy a smaller house.– [Seth] Wow. Is there anything that you would kinda say to the younger you when you were first getting into it that you're like, okay, you might wanna do that a little differently. Is there anything that kinda comes to mind like that?– [Michael] Well, I think heart-wise, I mean, obviously, we all grow up, we all make mistakes. If we really are seeking the Lord, we all get a little wiser as we get older, but I'd probably go back and tell myself at 23, 24 years old, I'd probably just say dude, it's not about you. That's probably the first thing I would say. I was so, like, how many records did we sell, and did we sell any t-shirts, and it was just so like… And it's hard, 'cause you're excited, and you wanna be successful and I think I just wish I'd have seen the bigger picture a little bit. And that's probably what I'd say to these young kids going, why are you here? Reconnect with why you're here, because you're not here to be a superstar. But there's nothing wrong with being successful, at all, but it just can't drive you, it can't just encompass everything that you do, it just can't. I always say, what's your contribution, think about… Even in the hard times, and trying to get the thing off the ground, are you making a contribution, are you changing somebody's life? So, it's that kind of stuff I'd probably say, and then, if I had to say something on the musical level, I'd say it all starts with a song.– X O'Connor sitting here with Mr. Seth Mosley, founder of Full Circle Music. Getting ready to talk a little podcast action. So, your favorite episode out of the, we're at episode 100 now.– Crazy, absolutely crazy.– Yeah.– And your favorite one was with Chris Houser under very interesting circumstances, from what I remember, kinda spontane, spontaneous.– It was very spontane, I like that slang.– You know, it's kinda like pre-Fontaine, that runner guy, but it's spontane, it kinda flows off the tongue.– This was a spontane moment, we were in the car, actually on a radio tour, and one thing that I've learned by doing a podcast is, we're really, as sort of journalists, trying to bring interesting stories to our audience about stuff that they'll actually care about, you kinda just have to be ready at all times. So I've got this little pocket recorder and a couple microphones, I stuck it in the bag 'cause I felt like we might have some interesting conversations on this Matt Hammitt radio promo tour. I went out with him at the beginning of the year to promote his first single, ‘Tears', off his record. And so I just brought it with me, and we were spending a lot of time in the car, so I was like, okay, there's gonna be something good. So it was under interesting circumstances, but I think, what I've loved about our podcast is when our guests kinda just go off the rails a little bit and just feel free to tell stories, and just crazy. And Chris is such a great story teller. So it was one of my favorite episodes. And not only because of the episode itself, but really because of my story and how I met Chris in the first place. And one thing that he did that stuck out to me that I'll never forget, we touch on that in the podcast, as well.– I love it. And he's known for hitting as many radio stations as humanly possible in a very brief time. I believe you said he has a record. Do you remember what the record is?– He does have a record, he said he hit 13 stations in three days.– Now, were you a part of that 13 stations in three days?– I think we did, maybe, we might have done eight in two days.– Eight in two, that's still rather impressive.– It was a decent few. But I love it because, so often in this business we think about the result more than the relationship. And one thing that he drove home that you'll hear in this clip is that he talks about, really what he does for a living is to get to go talk to his friends about music that he loves. He actually cares about the people. And there are very few people that I know in life, let alone in music, in anything, that have spent three decades serving one group of people. And that's just dedication.– Man, you said it right there.– Yep.– It's powerful.– I'm ready to go back and listen to the episode myself.– Me too.– So let's jump into this episode with Chris Houser.– [Seth] You talked about you started tapping into your skillset which, I don't even know if you remember this but when I first moved to Nashville, I talk a lot about this on our podcast that my first record that I got was Newsboys, Take Me to Your Leader, and my first label record I produced was this one called Newsboys Born Again which you were working on.– Yes.– [Seth] And I think I met you once, maybe at Wes' house. Then I saw you, I don't know, a month later or something and you were like, hey, Seth, it's good to see you, and the fact that you even just remembered my name —– Oh, wow.– was huge.– [Seth] To me, your competitive advantage is you actually care about people and you're great with relationships.– [Chris] Thank you, man. That means a lot, and again, it's a, this is a small industry we're in, and I'm in my 30th year of promotion, radio promotion. And I think I'm starting to get it figured out, but every once in a while something comes along and surprises me, but I've seen a lot of people come in and go out from this industry, and one of my favorite clients, Brash Music, who had Aaron Shust, and Gunger, their MO was life's too short to work with jerks. And I also believe very strongly that you reap what you sow, and whatever you sow, you reap way more, and you reap way later. It's just the way it is. You can go out to a field with a handful of seeds and throw it out into the field, you don't go out the next day and say oh my gosh, look at all the growth. It takes a long time, but all the growth that comes into a field from one handful of seeds. And so I've always tried to be about sowing good seed, doing my best to love people well, and not losing myself in the process, which at times has been a challenge for me. Yeah dude, I don't remember meeting you, and I wish I did, but it's been an amazing thing to watch your trajectory as well, and to be doing this. We're on a promo tour right now.– [Seth] Yeah, that's the fun thing right now, we're out with an artist named Matt Hammitt.– [Matt] Yeah, what's up?– [Seth] We're actually promoting his new single, Tears. So this is what you do all the time, right?– [Chris] Yes, so these radio stations, we're visiting six, seven radio stations in two days, my record is 13 stations in three days.– [Seth] Wow.– [Chris] That was up in the Midwest, that involved taking a high-speed ferry across Lake Michigan, from Muskegon, Michigan over to Milwaukee, Wisconsin, dropping off one rental car, picking up another rental car and continuing to go. But these radio stations have a hard job, they've got 50 to 75 singles getting work to them every week by 30 to 35 record promoters, both between labels and indies. And so one of the ways that we get noticed is by bringing artists directly to them. And Matt is so beloved for, you know, radio stations are gonna play Lead Me every day until Jesus comes back. It's just a matter of fact, no one's gonna get tired of Lead Me by Sanctus Real. And so I never worked a Sanctus Real record, I've watched them from afar and been so impressed with them and their ministry, and so, there are other people you could go to. But you came to me to take this record to radio, I'm very honored by it, but in addition, I'm moved by it. I have to love, this is what I tell people. I make a great living talking to my friends all day long about music I love.– [Seth] That's a pretty good job.– [Chris] So I turn down the records I don't love. I take the records that move me, and the records that I love, by artists that I respect. And, I'm calling my friends, I'm not calling adversaries, I'm not talking to people at radio that I have to buffalo, or steamroll, or belittle, or slam a phone down and swear, and call them jerks behind their backs. I love these people, these are my friends, so I get to just go bring Matt and you, Seth, to my friends for the next two days. And these are people who work hard, like me, back in the day, they do it way better than me but none of them are making major amounts of money. They're doing this for love and calling, and yet, they're the venue, they're the avenue that we will go through to get this song on the air. And it's already impacting countless, thousands of people around the country in a very, very short amount of time.– [Seth] Yeah, well even, on the Sirius Highway, or Sirius XM The Message, they debuted the lyric video, we were just looking on the way up here and it's already at 37,000 views and 893 shares, which is a pretty substantial metric for a brand new label, essentially relaunching an artist.– [Chris] Yes.– [Seth] So that's a huge thing.– [Chris] Yes.– [Seth] Are you ever surprised and shocked with like a song that you think is gonna work doesn't work, or a song that you don't think is gonna work just blows up?– [Chris] Yes. I would say, my joke on that is, through years of therapy I've been able to mellow out a little bit. But there were times 10 and 15 years ago that I was sure a song was gonna be a smash, and nobody wanted it. It's like these 115 radio PDs got together in a smoky room somewhere and all decided what they were going to tell us promoters for the next year, and then they'd all go like, break! And they'd clap hands and they'd walk out. And so when I would get this massive pushback on a song, in the early days of this kinda promotion, I would go like, I don't know what a hit is anymore, I've lost it. And then I would go to the next step, I'm like, Am I even a Christian? And then I'd go all the way to like, God, are you even there, if I can't… And so, again, years of therapy have helped mellow me out, and life experience, just to get into a better spot of going, you know what, sometimes I'm wrong, a lot of times I'm right, and sometimes it's the radio stations that will say, oh, no, that's not a hit. I try to slow the no, I try to slow them down, because it's like, if you make a pronouncement, a negative pronouncement on a song this early, it's gonna be that much harder for you to admit you're wrong eight months down the line, six months down the line, let's just calm down, you tell me no now, that's fine. I'm just gonna find 20 people that you respect and get them to play the song, and we'll come back around, we'll just keep talking about it.– [Seth] And those people they respect, is that other radio promoters?– [Chris] No, no, other radio stations.– [Seth] Radio stations.– [Chris] Other radio stations. So then they're watching around to see who else, 'cause it's all defensive posturing and maneuvering. It's all, they don't wanna add a record, a radio station will say, we'll never be hurt by a record we don't play. Do you get that?– [Seth] Wow.– [Chris] We can never be hurt by a record we don't play, meaning, we might be hurt if we go too early on a song that our listeners end up not liking. So we'd rather watch the landscape and see what people are playing out here, and it's like, okay, that's fine. There are leaders, there are followers. If you need to be a follower on this, no harm, no foul, we're just gonna keep working this.– So I'm sitting here with Logan Crockett, VP of marketing for Full Circle Music and, man, what a ride it's been, we're on episode 100 on the Full Circle Music Show and we're talking about our favorites, favorite moments, and why listeners should probably go back and listen to some. And I love that you picked the Tony Wood episode. So what stood out to you about that, and why should people go back and listen?– Yeah, for sure. So with me, my perspective on the podcast is probably a little bit different from a lot of the rest of the staff. I've been around for just over a year, now actually working for Full Circle, but initially, listening to this podcast, I was, completely from the outside looking in, I was just, kinda like a lot of the people probably listening and/or watching this, someone just trying to kind of find their lane, their path in the music industry. And this episode with Tony Wood and this clip that we're about to play just really stuck out to me as something that I've never, ever forgotten. For so long, I mean I've been pursuing the music industry for years. And it always felt like, man, if you can just get kinda that one meeting with that publisher or that record later, or whatever company, just meet that right person and get that connection. If you can just do that, that's kind of hopefully the gateway to greater things, that kind of, getting that meeting, basically. But in this clip, Tony explained that it was so much more about getting meeting number two than about getting meeting number one. Because it really does make sense, getting meeting number two means that, if you had meeting number one, they have to like you enough to invite you back. And the way that Tony explained it in this clip, it was just, it was such a massive mindset shift for me because it just, it reformed my entire strategy for what I was trying to do with the music industry. It became so much more about okay, yes, meeting one obviously has to happen, but actually that's the easy part. So my goal was how do I get meeting number two? Meeting number one kinda flew out the window, and everything became about how do I score meeting number two, no matter what relationship I'm building, no matter what opportunity I'm pursuing. The goal became meeting number two.– Yeah, and in music, it's often about finding someone who is really where you want to be. And kind of emulating them. Wasn't there something that stood out in the episode about that, in particular?– Yeah he, Tony had kinda got his start thanks to someone named Tom Long, who was kinda that first person who really believed in him and helped introduce him to other people. And that was another big mindset thing for me, too, was this idea that, there's a lot in the music industry that you can control, there's a lot of things that you can do yourself to push yourself forward, but, it's going to be really, really, really difficult to get where you ultimately want to be if you're not finding someone else who can kinda elevate you. You need to find a champion, or a guide, someone who can get you further along the steps that you need to go.– I love it, and there's also this concept of, do your homework that Tony hits on, what did you mean by that, 'cause you were saying that that stood out to you.– Yeah. So yeah, again, all this stuff is in the clip that we're about to play, but Tony, it's a very kind of quick comment that Tony mentions, but when he was first meeting these other writers around town, and other publishers, he said that he did his homework on who they were and what they were up to. So basically, that really stood out to me 'cause now working for Full Circle, we have a lot of people who come through a lot of our events and things like that, but it feels like a lot of them haven't done their homework. A lot of them don't know like even, who is Full Circle and what are the different things that we do, what songs have we been working on, things like that. Normally I'm on a lot of calls with people through our academy and things like that, normally I have to completely explain almost from ground zero, what it is that we do, who we are, things like that. Not the case for everyone, but all that to say is if you are pursuing the music industry, before, and this kinda goes back into meeting one versus meeting two but before you get meeting one, make sure you do your homework, so that way you're giving your best first impression, and you're having amazing talking points when you do finally have the opportunity to sit down and have those interactions.– That's good. One thing that I love that we get to do with the academy, with our events, with courses and all of this stuff that we're doing is that we're helping dreamers, essentially. And there's kind of this common thread that we've heard, and I think you mentioned that Tony hits on this in the podcast. But this concept of, just trying, just giving it a try.– Yeah.– And why is that important, do you think?– Towards the end of the clip that we're about to play, Tony mentioned kind of his ultimate motivation towards, the big jump to moving to Nashville and pursuing all these opportunities. And his whole thing was like, you know, there's so many great opportunities in life. You don't have to be in the music industry, not everyone is meant to be in the music industry. The music industry is very competitive, not everyone who wants to be in it is going to be in it. But Tony's whole point was, that just really resonated with me was this idea of man, like if I don't just try and kind of give it everything that I have, a no is okay. Like if I meet the right people, and if I'm perfecting my craft and it's not good enough to be where it needs to be for the industry, then at least I tried, and I can live with that. But his big thing was like, man, if I don't try and give it all that I have, I won't be able to live with that. And that just resonated so much with me at the time, 'cause again, this was like, I think early 2016. So again, at the time, my involvement in the music industry was a little limited, I'd recently gotten out of college with my music business degree. I had a really great marketing job, but I wasn't that involved in the music industry, I was like running sound with my church and some things like that. But I knew that… In my being, I'm like, the music industry is where I ultimately want to be. And I was in a place where I kinda had a good job and all that sort of thing, but it was like, man, can I live with it if I don't do all that I can to get myself down to Nashville, to pursue these opportunities. And Tony just saying that, it's like, it was like he was speaking for me in that moment. Like yes, like that is ultimately where I'm at and I decided, there is no way that I will be able to live with it if I don't try, and give it all that I have, no matter what the outcome is.– And here you are.– Indeed.– Fruit of the podcast, that's awesome. Well here is a clip from Tony Wood interview on the Full Circle Music Show.– ASCAP was real helpful to me early as a songwriter, there was a conference that they offered like about five or six Monday nights in a row in October, where they brought in writers, producers, publishers, some great instruction. Something in that that was so significant, songwriter Dwight Liles said, the hardest meeting to get in Nashville with a publisher is not the first meeting, the hardest meeting to get is the second meeting. And it just killed me in that moment, 'cause I am such an introvert. And they would use the word networking and I hate the word, 'cause networking feels like, walk across this room and introduce yourself to this stranger, and tell them why they need to get to know you. And it's like, it's against everything within me, I'd rather just take a beating than do that. And I was like oh, no, if the hardest meeting to get is the second one, I'd better be ready when I get that, when I finally get the nerve up to go introduce myself, I gotta know that I'm ready. So that sends me into a month or so of panic about what do I do, what do I do. And I came up with this idea, Tom Long was the head of membership at ASCAP at that time, and he had put the conference on. The conference had happened three or four months earlier and I'd been stewing on that. And so here was the first professional initiation for me, I picked up the phone and I called Tom. And I said Tom, in the course that you moderated, somebody said the hardest meeting to get with a publisher is not the first, the hardest is the second. I need to be ready, I need somebody to tell me if I'm ready. And here comes the ask, Tom, will you be that man for me? And Tom says well, nobody's kinda ever asked me that, but okay, I tell you what, every couple of months, give me a call, bring me some of the lyrics that you're writing, and I'll take a look at them and tell you. I can't tell my story without such gratitude to Tom, Tom Long, for that. So I take the first meeting with Tom Long, walk in, the three current pieces of paper that I've typed up, put them on his desk, sit there, quietly feeling my organs separating while he's reading them all, just the tension, just dying right there. And Tom reads three and says, I've got some people you need to meet, get in the car. Drove me around to four publishers. I had done my homework, I knew who the publishers, I knew these people, I knew who their writers were, I knew the songs that they were having success with at that point. The first three dismissed me pretty quickly and go, eh, thanks but no thanks, and the fourth one was Michael Puryear who was with a small company, Lorenz Creative Services that was going at the time. They had just signed Steven Curtis, though before his first record, that was his first home, and they had recently signed Marcus Hummon who wrote God Bless the Broken Road. So it was kind of this small little boutique thing that was going, and Michael is more of a lyric guy, and he said, oh, why don't you start hanging around here some, and let me see if I can get some of our guys to write with you. And that was… The life changing moment for me, I'm so grateful to Michael for early belief in me.– [Seth] Sure. So, backing up, 'cause just the move to Nashville is such a huge leap of faith in the moment, I don't wanna gloss over that, for you and your wife. I'm sure that was just like a monumental thing. How does somebody know when they're ready to do that.– [Tony]Nobody knows, there is no knowing, there is nobody that's gonna say the time is right. It is that line between faith and foolishness. That's so close in there, you don't know. But I remembered, there was a point when I was finishing up school and still writing frantically, accumulating lots of sheets of paper. And they were in a box kinda under a bed. Early 20s, and I remember thinking, I can't imagine hitting 50 and not knowing, and not trying. I could live if I dared to show those to somebody and they said, ah, thanks but no, there's really not a place for you. But I couldn't live with myself if I didn't at least try. I remember sometimes feeling almost claustrophobic at that thought like, if I hit 50, and I've never at least tried, I almost couldn't breathe thinking about that. So that was some of the motivation that, you know if they had said, no thanks, go away, I could've lived with that, I could've gone and gotten, I could've worked at a church and been real happy with that, knowing that I tried. But not trying just was killer.– [X] Hey everyone, this is X O'Connor and you've been listening to the Full Circle Music Show, they why of the music biz, hope everyone enjoyed our episode 100, the special episode. It's impossible to believe that it's been 100 episodes already. And again, this is our last episode for a little bit, we're gonna be coming back at you with our brand new, re-imagined, rebranded podcast, the Made It in Music podcast, it's gonna be starting Monday, March 26th. It's so exciting, we're so pumped. So again, remember, March 26th, that's a Monday, that's gonna be the official beginning of the Made It in Music podcast. And we have some huge names already lined up for this, you guys are gonna be super excited about what we've got to come. It's gonna be more great content, for free, for you. We're looking forward to seeing you Monday, March 26th.The post Episode 100: The Best of The Full Circle Music Show appeared first on Full Circle Music. See acast.com/privacy for privacy and opt-out information.

Divorce Well
06 - Michael Daniels on the FAYR app, Gwyneth Paltrow's mentorship, and streamlining co-parenting

Divorce Well

Play Episode Listen Later Nov 23, 2017 27:57


The groundbreaking FAYR co-parenting app is taking off due to the dedicated efforts of its founder Michael Daniels and its senior advisor Gwyneth Paltrow to improve the lives of co-parents and children. The challenges of co-parenting can be overwhelming and can lead to significant conflicts. Michael Daniels came up with the idea of creating an app for co-parents to help them effectively manage their time, their finances, and their co-parenting communication. FAYR is a groundbreaking app that simplifies everyday matters for divorced and separated parents.  As a separated father of two young children, Michael found himself overwhelmed by the legal, financial and emotional costs of divorce on his family. After 20 years in the homebuilding industry, Michael hung up his hard hat to create a tool that would not just improve his family’s life, but would also help the other 55 million divorced co-parents in the US. Despite his success on the Apple tv show "Planet of the Apps" and partnering with Gwyneth Paltrow, Michael's guiding light remains the same: working everyday to be his best self for his kids.  Your host, Christina Vinters, is a nationally designated Chartered Mediator on a mission to inspire and facilitate healthy family transitions. She is an “ex” Divorce Lawyer (Non-Practicing Member of the Bar), Author of Pathways to Amicable Divorce, and the  DIY Divorce Manual, and Peacemaking Business Consultant. Guest Links: Website: https://www.fayr.com Instagram: https://www.instagram.com/befayr/ Facebook:https://www.facebook.com/befayr Twitter:https://twitter.com/befayr Linkedin:https://www.linkedin.com/company/fayr/ Modern Separations Links: Website: https://www.modernseparations.com/ Facebook: https://www.facebook.com/modernseparations Instagram: https://www.instagram.com/divorcewell Twitter: https://twitter.com/cvinters LinkedIn: https://www.linkedin.com/in/cvinters/   Christina: Hello and welcome! I'm super excited today to be talking to Michael Daniels. Michael is the founder and CEO of the new Fayr app (spelled F-a-y-r), and it's a groundbreaking app that streamlines key aspect of family management for divorced parents. That includes sharing a parenting temp calendar, tracking shared expenses, recording communication, and more, all in one location. Fayr debuted really in 2017 and drew interests from Apple TV, who invited him to audition for the reality series "Planet of the Apps". Michael was selected for the show and he had huge success, securing a partnership with his now head adviser Gwyneth Paltrow. Gwyneth is well-known as an academy-award winning actress of course, but she's also an active entrepreneur, with a highly successful lifestyle brand goop.com. She's a passionate voice for improving the experience of divorce for families and drew a lot of media criticism a few years ago for her announcement that she and her husband were consciously uncoupling. It's so exciting to see Michael and Gwyneth working ways to make life easier for co-parents, which is going to make a healthy and respectful divorce achievable for more and more families. Check out this interview with Michael to find out all the things that Fayr can do and how it can make your life better. Alright, let's hop in. Christina: Welcome Michael thank you so much for being here with me today! Michael:  Thank you for having me, Christina.  Christina: I'm really excited to talk to you because of the super positive project that you got involved with to help co-parents do a better job. Why don't you tell us a little bit about your background and how you got inspired to create the Fayr app? Michael: Well, I would say my background can't be any further from this subject, I'm a home builder, I mean, I started building homes when I was a teenager, just an able-bodied worker. Later on, I went to work for the largest homebuilder in America and worked for them 6 years before going out on my own to become a custom home builder. And you know, like everybody else a lot of people go through divorces and it was just a very trying period for me. Family is important for me, I come from a military family and my father was an army officer for 30 years or so and you know traveling around a lot, family was always just important - we're always together. And I would say that that had a lot to do with feeling my interest in trying to do what I could for my kids and so, yeah, that being my background, I think it all really fed into my interest to communicate better, be as much a part of my children's lives and in a positive way. Christina: Well, the fact that you're outside of the standard legal divorce industry gives you a whole new perspective, I think what the industry needs. Michael: I think I relay to people really well, I find that the people I feel most comfortable and most effective in communicating with are just the regular people. I kinda leave it up to my team, they kinda do a better job than communicating with the professionals in this industry. Christina: And so how did you get inspired to create the app? What was the thinking behind that? Michael: What was the ah-ha moment? Christina: Yeah. Michael: Well you know, it's a culmination of a lot of things. You go through like these unexpected things can happen at any point. And so you get divorced, and then as the time goes on, the whole process was just tremendously arduous when you think about the two years it takes before from separation to finally getting through things, you fight over custody stuff, you know, whole bunch of money spent, and this is the measurable process and then when it's done and when you finally sign your parenting agreement, you think everything's gonna be okay but it's not. Emotions pop up, and next end, like you know, 6 more years went by and it's still not at rest. And so you never know when you're gonna be caught with this need to go back to court. And are you documented? Most people lose, not because they're bad parents, but because they're insufficiently documented. And I did, it's not fun to reconcile with laws all the time, and I would have to reconcile these laws every night and just miserable way to live thinking about this stuff constantly and so. Then you go to court and then the other person can very well say, "well you made that up". And there's really no way to prove anything, you know. You can't verify some of this stuff. So I thought to myself, "if there was something that could just galvanize, Google docs, Google calendar, your emails, Google spreadsheet, all of these things that I was happy to use constantly, text messages and everything, have it wrapped up and a one app - specifically like a go-to resource just for co-parents to either co-parent together or just document, just to avoid mitigate future problems. Assuming that was it, it was just a culmination of many years of these things and I just one day started looking into this. I mean, if nothing else, it's gonna help my life and probably help a lot of other people too. Christina: Okay. So I think this sounds like a good place for you to tell us a little bit about what the app does.That sounds pretty cool, the calendar and Google docs and so forth. All of that being rolled into one. What does the app do, and I'm wondering you mentioned that you can either use it together for co-parenting or it sounds like you can just also use it on your own? You don't need the cooperation of the other if you're just looking for documentation? Michael: Yeah absolutely. I mean it's basically an all-in-one digital ledger for child custody. So it's just the place you can go to let's say for example, things that parents run into. Let's face it, and I say this sometimes because I don't think people are very conscious of this, is that there's no other area in life that you can be in a simple lawsuit with another human being and you're forced to continue communicating with that person for years to come, you know. So it's a very stressful situation but the importance of communicating constructively with that person is paramount. And so how do you bridge this problem between the necessity for the benefit of the children (in my case 2 children) that you love the most in life, and then you have this horribly frustrating situation where you don't communicate well  because you were in a very bitter, emotionally, hard suit with this person. Because that what these things are - they're lawsuits. So anyway, I thought, what the app can do for you is let's take the calendar feature for example. It's color-coded so mom stays in one color, dad stays on another color, you put in your time-sharing agreement. And then if you need to switch a day, you can just let your day request just a fourth of the day to the other parent. The other parent instantly gets a notification saying "oh, Bill wants to forth his day to you". You can either accept or deny. If you accept it, it changes to your color, and it doesn't switch back to his color unless you release it again. But that way, if anything doesn't rise, your building this incontestable audit trail of information as life is happening. And that's just the calendar feature. But, it just streamlines things to where it's sending a new notification, it's letting you know when soccer is, you can set it up front where repeat this for the next six months every Tuesdays and Thursdays. And then every other year switch your Christmases, so everything's put in upfront and then it's just laid out for you. No more arguing, no more disputes over this particular issue. And I just wanted to simplify, take out all the arguing that goes on. And then the next feature, let's talk about expenses for example. I mean, people are very good about keeping a mental inventory of their own contributions for their children. But there's seldom real knowledge what the other person is doing. And no one's very good about keeping receipts, and no one's very good about all of the things that we have to juggle. And when your attorney tells you, "Hey, Friday I need all these stuff", it is terrible to have to start digging all that up and reconstruct that audit trail information. I had to call two different banks. my insurance company, doctor's offices, and dentist offices have reprint stuff and just have to dig it up and I'm sure there's still stuff missing. And if you dump it all at your attorney's office and your paralegal, just put it in a court-ready format, you know. That's costed you per hour. So it just all gets very expensive, I mean, I just spent nearly sixty thousand dollars in total on all these legal fees. And you think about what that could have done for what I have for my children. Anyways, the point is with this app, as things are happening I don't have to keep receipts anymore, buy something and I simply snap a picture of the receipt - it's there, it's recorded. Then I plug it all in,  and that's it. She can see it instantly, she can see everything that was purchased. Right now it's four categories and I'm about to expand that. So I called them involuntary expenses, it's either your medical, your dental, your personal or educational. And some of these things are tax-deductible. So the app also know which are tax-deductible, and at the end of the year, you can just say "give me my tax-deductible report", and it'll give you everything you've spent on your kids that you can deduct from your taxes as well. So just organizes everything, you don't have to save any more paper, and that's really beneficial. And again, at a glance now, both parents can see what's happened, and shortly you'll be able to settle up with each other within the app. You can just say, "okay I'm gonna settle up". You click the button and automatically transfers money to the other parent. You can pay child's support alimony, everything's gonna be able to be documented paid right thru the app.  Christina: Oh that will be handy. Michael: Yeah it will be great. And you can set it again. I want to make a co-parenting app that just lets you co-parent on autopilot. So yes you may do some work upfront, plugin all the stuff in. But once it's in, from then on out its just small little adjustments, here and there, as life is going on and you still make adjustments. But for the most part, you're just gonna get these "just go through life and things are gonna be nice and easy". So the next feature is my Geo pen points. The reason I have these is 'cause there are a lot of hidden cases where you're supposed to be somewhere but timely dropoffs or pickups, and there are court orders a lot of times, and to prove that you were there on time is an important thing. So with this feature, you can show up, you can simply say "I want to check in" and you log yourself and there it is - a time, date and stamp that you were on the planet in that spot at that time. So there's just no more he-said-she-said when you go to court. It's just you're good. You know you can prove that you were there. That prevents people from using children as chess pieces. And then the last feature that we currently have is our invisible text messaging. So every lawyer tells you, communicate email, 'cause emails are invisible in court, text messages are not. Well, with these, you have the best of both worlds. You have the ease of text messaging with the invisibility of email. It works just like the IOS messaging, super easy. And at any time you can just say "I wanna generate a report", and all of this stuff, every single day you had them the percentages, everything from whatever time, period you want to look at, just be instantly printed out in a PDF or Excel format. And there you go. Shortly though, right out just the two parents that can be on it, they are onboarded on in the system but shortly you'll be able to have third-party users for this login, to actually grow our user base tremendously. But you can have grandparents who are involved, step-parents, aunts, uncles, legal professionals, they'll have an interface too if they need to monitor just make a guardian light them for example. It's just gonna make everything much more simple, much more honest and fair - that's the name of the app, it's "Fair". It stands for Family, Advocacy, Your Responsibility, just to help make things easier that is in a very difficult situation. Christina: Sounds like it's streamlining a lot, saving a lot of time, and kind of peel back and take away some of the emotion out of the communication? I'm wondering if for example if we go back to the Calendar, and your request to switch a day, is that just very black and white like that or you switch it where you make the request, or do you have the ability for example to say, you know I have to work late next week. Michael: Every single one of these functions  - I know I'm just doing kind of a brief over if you're here, but if you select to switch, it actually requests you know, give a reason. You have to write a reason in so that it's notified "hey I'm working late" and you can put notes down there. So when this is printed off in the main report, it'll show that on Saturday, at 4:36 PM, you requested a fourth of the day, the notification was sent, it was accepted at this time, so the whole record is there for a judge or anybody to look at and they'll know exactly what happened, and the notes will be attached there too. "Oh I've forth of the day because I have to be here or this happens", so the communication is there, let's face it, six months from now I'm not gonna remember why I'm not gonna remember what happened. So, I've definitely thought all of that, I wanted to make this thing just as useful for people and just take out the anxiety that we go through later on. Christina: It sounds like some of these features might tend to actually encourage, better behaviors, so I'm wondering if, by using this app, maybe court applications are actually reduced or eliminated in some cases, what kind of feedback have you received? Michael: I mean I know from my own personal experience that it definitely mitigates problems that usually escalates to costly, you know court motions, and look you know, that's what we all want. I mean, our family courts... you correct me if I'm wrong I know you're more of a guru on this than I am but they're the most backed up courts in America, I mean that's why in some places it's up to three years, backlogs. So, hey if we can reduce problems and keep some money in some families pockets cause you know, it's they're sad statistics you know. I think most people know this what's sad is that you don't go in any sort of parenting tutorials. I don't know if they do this everywhere, but here in Florida, when you go and get divorce they make you take an online little... watch all these videos and take retention quizzes, and things like this that educate you in parenting, it's like "Man I wish I did this before when I became a parent." And then of course in this process just learning more about the effects of these two home situations on children nationally, it's pretty scary. I mean when you look at some of the statistics out there, and I'm not saying the answer is people should stay together cause I'm a firm believer that a lot of people if they're properly communicating it's a better situation for kids, for two people who don't like each other to not stay together. But the statistics actually show that if your kid is being raised in a broken home, they are twice as likely to drop out of high school, they're four times as likely to go to prison, twice as likely to actually attempt suicide. They're medicated for things like depression and anxiety and insecurities. They suffer from speech defects, asthma, and headaches at a higher rate. And I don't know what, I'm sure there's a lot of things that contribute to those statistics but, I think that kids growing up feeling that their parents are butting heads all the time, that can't help but believe that that causes some emotional duress on them. Christina: Oh absolutely, I think a lot of the studies have shown that it is the conflict that occurs in separation, not so much the separation itself, but that exposure to conflict between parents that's really traumatic for kids.  Michael: Totally. Christina: This app, I think has huge potential and you've already had a really exciting launch this summer, tell us a little bit about the Planets of the apps show that you're on. Some of our listeners might not be familiar with that. So what that was all about and what your experience is like there? Michael: That was pretty phenomenal the whole experience honestly, I was.. it was July 4th, 2016 and I was at my cousin's boat. And I'm kicking around this idea of building this app. So I priced it out and you know it was gonna be quite a bit of money, and I'm like "Man do i do that or I'm not... this a lot of things I can do with that kind of money " and he said "You know Mike, it's something that's.." he's like "I've been listening to you for 8 years complain about all the things you go through"  you know he's like.. "I think it's a good place to direct your energy and you gotta be passionate about something in life and you're really passionate about this" so I said, Okay I'm gonna go and pull the trigger. So 2 days later I put my deposit down, I started building it. And fortunately I did, cause if I had waited four days, I would've missed the window to be considered for Planet of the Apps. And it was very fortunate, and I didn't know they started with nearly 10,000 applicants and they narrowed us down to about, I guess about 80 of us that made it. And then of the 80, I mean less of a third of that made it to the final round, that I did. So it was really exciting cause I'm not an app builder, I mean I got out there and I was just overwhelmed by all these crazy smart people, I mean they cruise at that intellectual stratosphere that I can't look at from the ground binoculars, it's super smart people out there. And anyway, it's a good experience, so I go out on Planet of the apps, and we're filming this thing and I was lucky enough to have all four of the panelists there, you know Jessica Alba, Gwyneth Paltrow, Will i.am, and Gary Vaynerchuk, all four of them wanted to partner with me, and I think I was one of the only ones who have that. And super exciting, and again my app that time was just a concept, it was a Beta, it had to be in Beta but it was far from being in the app store. Far.  So I ended up choosing Gwyneth, and I chose Gwyneth because, one she's the only person who'd gone through a divorce, two you know this is a subject she's very passionate about, and you know the whole conscious of coupling that you've referred to as well. She gets it, and that's an important thing. I think I'd go through life and I think most people listening would probably agree that you just run into people especially when you're back out in the dating world, and you meet people who just don't get it. Unless you've been through it, it's something that kinda connects people. My dad was an army guy, so I kinda equate it to people who had gone to war, and you just talk to another guy and they just get it, you know. So anyway, I partnered with her, we met many times, we corresponded, we still correspond via email. And she's just been very very supportive, that I mean I'm about to launch Android and when android launches at the end of this month, I'll be re-engaging her efforts to get, start tweeting about it again. She's tweeted for me in the past and that's very helpful, I always get a good spike in downloads when she does that. And hey you know, it was a phenomenal experience, I gotta tell you I feel very lucky and I'm very happy that I have somebody like her who isn't just... she's not just bottom line focused like a lot of people are, who are just like "So how much money is this gonna make?" She's more concerned like when we met, it's like "is this gonna help people? Let's just focus on helping people and everything else will take care of itself." And I like that, I really really appreciate that.  Christina: Yeah for sure, I can see that in addition to her acting career she, of course, has the eCommerce lifestyle brand goop.com, which is also focused on having a great lifestyle, and you know the various different aspects of that, so having a positive co-parenting relationship I can see that would sort of fit in to that. Yeah, and she did have that very high profile divorce a few years ago, where the media was quite nasty towards her. I found it to be really discouraging that the intention and the desire to have an amicable divorce would be considered by the general media as being sort of a ridiculous goal to have or you know, just something the general public could aspire to.  So I love that she's putting up her energy behind this with you.  Michael: I think she's such a gracious person, I think Gwyneth is a really, you can just see it like when you're talking to her that she's really, you'll never know, you know I mean most of the media unfortunately for her, they portrayed her in any way that they want to, and they could do that with anyone, they could do that with you, me, anybody they wanted to. And I think it's unfortunate cause it's a "yeah you got your head in these clouds if you think people can do this amicably". But she's, you know, she's told me that she has a better relationship now with her ex-husband Chris, than ever before! She says "you know we have the best relationship we've ever had!" and that speaks volumes to her because that takes work. That takes a real concerted effort to just be able to say that, and to have done that cause she's doing better than I am, you know I mean like.. most people just don't do that well, with that. And I think most people like she said like most people get caught up in trying to be right... I'm right, I'm right. But it's like, it's not about being right, it's about being effective. Let's be effective for the benefit of our kids, let's not worry about being right. I listen to that, cause I'm.. just one of these guys who just want to be right. You know, I wanna win the argument. But you know, I got some maturing to do as well, you know. Christina: You've done some learning over the years. So in what circumstances do you see the app as being useful? Is this something you can see rolling out to most separating couples? Michael: Oh my goodness. I gotta tell you, I think married people should use this. I mean, let's face it, the number one reason above infidelity and religion - it's funny as it is, and if people would use this app, 'cause so many times, you know in today's world, and this isn't 40 years ago, but today's world, not our parents' generation, but you have 2 separate incomes, 2 separate bank accounts, and 1 person oftentimes paying the lion share of the expenses, and the other person's dropping it on a Harley Davidson or something like this just toys, and that becomes a point when things get tough. That becomes a real point of contention in a relationship. And so, I just think that anybody should. But obviously, that's a little lofty when you think that much married people are gonna jump on it. But, I gotta tell you, I see it ideally if two people can co-parent constructively together, it is a great platform for that. But if not, man do yourself a huge favor, use it because it is so much easier to just stay on top of things that document now than try to dig up those receipts later on. And you never do it, you never end up doing it, in fact, most attorneys tell me "I'm so frustrated with my clients because I tell them document... document and they just don't do it, and then inevitably they lose, and you know, that sucks".  Christina: Well there's so many things going on in life where you're separating trend to figure out where you're gonna live, maybe do you need to change your job, how are your children doing, and so the documentation just falls through the cracks. It's not high on the priority list, even though the lawyers might like it to pay. Michael: Yeah exactly. You've got life happening. And let's face it, it's not a fun thing to do. It is just the whole time you do it. You just dread it. It's not fun, I mean, and most people aren't organized with a lot of that stuff, so I just try to make it as easy as possible. And I think Fayr has a sincere effort at accomplishing that.  Christina: So having been divorced yourself and now being part of this industry trying to improve the experience for separating couples, do you have any advice? For couples who are in the process right now? Michael: Yeah I do, and it would be, you know it's tough because as you know, once you're years passed it you look back, and it's just like don't live with regrets. Really, really try to power through the nasty things that you kind of do, the unfair things that you do, because you're gonna regret the impact that it has on your kids later on because you wanna be the best you, you wanna be the best version of yourself for your kids. And the only way you're gonna be able to do that is just suck out the poison and they always say, you know, it's not the snake bite that kills you, it's chasing the snake that sends the venom to the heart that kills you. So just don't chase things. Just like what Gwyneth said, "don't worry about being right, just be effective and just be fair." I don't know, it feels like it's so easy to say, it feels like a cliche, it's like to put myself in that position back then, and I would say, "man, what the heck", he doesn't know what he's talking about. He isn't in my situation but, that's so I could tell parents it's just really trying to be fair with one another, 'cause it just hurts your kids when you're not. Christina: I think that's excellent advice. For people who are interested in trying out the app, what's the best way to contact you or to get a hold of the app? Michael : Yeah, so we're obviously on Facebook,  Fayr. On Twitter, it's Fayr Dad, and on Instagram we're @BeFayr. www.fayr.com. We have a lot of great information out there, you can google me as well, Michael Daniels Fayr, and you'll see up just a bunch of plan of the apps stuff, videos. We've been in the news all over the place even in England and Germany, actually. We got a lot of exciting things happening.  Fayr is doing great and we're gonna keep growing it as 55 million people across America who are living in a sort of two-home situation raising kids co-parenting, and I'm gonna keep marching forward and helping every one of them out that I can. Christina: And right now you said Fayr is available on the Apple App Store? Michael: Yes it is available in the App Store, that's Apple. And in another 2 weeks, it will be available for Android. Sorry Android has taken so long but we're constantly improving things and that's just more development time.  Christina: So for people who are not hearing this at the time of the original release, that will be around the end of November 2017. Okay Michael well thank you so much for your contribution to improving the lives of co-parents and kids out there. Michael: Christina thank you so much for having me, I really appreciate it being here. Christina: And a pleasure talking to you.  

OptionSellers.com
Autumn Seasonals Option Sellers Can Capitalize on Now

OptionSellers.com

Play Episode Listen Later Oct 9, 2017 37:44


Michael: Hello, everyone. This is Michael Gross at OptionSellers.com. We are here with your monthly podcast for August 25th, 2017. I’m here with James Cordier. James, welcome to the show. James: Thank you, Michael. I’m always glad to be here and share our knowledge and wisdom. Michael: Excellent. Well, we are here in the last week of August and we are heading into Labor Day weekend and right around the corner is, of course, September. A lot of people come back from vacation, a lot of traders come back into the fold, and often times we find out where we really stand in a lot of markets that may have drifted one way or the other during the summer. Right now, as we look at stocks, kind of off a little bit. From the beginning of August we’re down, although up a little bit early in the week here at time of recording. We’ve had a little push downwards and, James, I know you addressed this in your bi-monthly address to clients on video, but do you want to talk a little bit about what might be going on right now in equities? James: Yes, Michael. The equities market, as everyone knows, has been hitting all-time highs throughout the first 6 months or so of the year; however, just recently, a bit of a speed bump with just absolute chaotic times right now in Washington D.C. A lot of the Trump ideas that helped get him elected, which propelled the stock market recently, are in question. Tax relief and de-regulation and 0% interest rates all might be influx right now, and, certainly, a lot of the reasons why people were buying stocks over the last several months were these very business-friendly ideas. I wouldn’t say that they’re gone and out for sure, but certainly they’ve taken a back seat to just simply getting Washington squared away. Hopefully these ideas will come back because they definitely are business friendly. While we’re not in the stock market, we certainly do root it on, because I’m sure a lot of our listeners and a lot of our clients do have stock holdings, so we’re always rooting for it. It has taken a little pause here for certain reasons, and a lot of them are some of the goings-on right now in Washington D.C. Hopefully it’ll get straightened out before too long. Michael: Yes, obviously this market is still in a bull market. There has been no bottom falling out and there may still be some reasons to buy the stock market. Just some interesting stats I saw was that as of earlier in the week here, on the whole year the S&P was up about 9%- not too bad, but certainly off the highs. Interesting note, James, the Russell was even on the year- no gain at all. James: Right. I noticed that, and a lot of the ideas of deregulation and, you know, lower taxation, that should be helping the small caps. The Russell being basically even on the year really does bring into the question is “How broad is this rally?” Certainly, the Dow Jones, basically we cherry-pick 30 stocks and the ones we like we put in there and the ones we don’t like we take out. Certainly, the Dow Jones has done extremely well, but some of the larger gauges of the stock market, like you said, are unchanged or up a percent for the year, and I think that was an eye opener to a lot of investors that saw that in the news here recently. I know it was to me, as well. Michael: Well, I’m just glad, James, that you and I don’t have to forecast the stock market because that’s certainly too many moving parts there for me. I know you feel the same way. James: Likewise. I really enjoy investing our client’s money and talking to our listeners today based on fundamentals of 10 commodities that have been around here forever and will likely be consumed for years and years to come. Michael: On that note, why don’t we talk about something we do know quite a bit about and that would be autumn seasonals, which is the topic of our podcast this month. We’re going to talk about a couple commodities here that we do study very closely and maybe do have some insights into. As far as talking about seasonals to begin with, if you’re a listener or have been listening to us for a long time or you read our book, you’re certainly aware of seasonal price tendencies in commodities. It is something that we follow very closely. They are not the buy-all and end-all of price forecasting, but they can certainly be a very big factor and something that can help you tremendously as an option seller. James, I know we were talking quite a bit about grain seasonals this summer and how they often sell off into the fall. Lo and behold, that seems to be exactly what happened across the board. James: Boy, it really is. Grain stockpiles around the world are at extremely ample levels. We did have quite a weather rally in the month of July and, Michael, it always seems to be too hot or too wet or too cold or something, then the market rallies. Come fall season, generally, some of the greatest producers of the world of grains are here in the United States and, lo and behold, we’re going to have quite a bit of a bumper crop in corn, wheat, and soybeans. When you add that to carry-overs from all the other production in the world, lo and behold, prices come back down to earth and they’re doing again this year. We’re not even through August yet and we’re making quite a push to seasonal lows here probably over the next 30 days. We have corn, wheat, and soybeans testing 12-month lows. It wasn’t that long ago, just a month ago, they were testing 12-month highs. Certainly, there’s a bit of a whipsaw action this year, like most years, and as we get into September and October we think prices will probably be quite heavy because of seasonal factors. Michael: Yeah, the seasonal tendency is not always perfect, as you and I know. At the same time, grains this year seem to follow it to a tee. They start declining oftentimes into harvest, the market starts anticipating that harvest, starts anticipating that excess supply coming on the market, and prices tend to start going. That’s exactly what they’ve done this year, especially now that we’re past the pivotal parts of potting and pollination in corn and soybeans. So, it’s just an example. If you’re listening at home and following grains, this is an example of what seasonals can do and how they can help. It’s not always perfect, but it certainly can help. That’s what we’re going to talk about now as we come into autumn. It’s a key time of year for a lot of commodity seasonals. The seasons are changing, there’s a lot of things going on fundamentally, and the first market we’re going to talk about of course, James, is one of your favorite markets, which is the crude oil market. This is the key time of year for crude oil, as well. Maybe you want to talk a little bit about the seasonal there and what tends to happen this time of year? James: You know, Michael, you mentioned something really interesting. The seasonals aren’t the end-all to commodity trading; however, it certainly is a tool that we enjoy using. It’s not spot on every year, but what we like to do, as you know, is we gauge the fundamentals going into a seasonal time frame. If they coincide with the seasonal factors, that is certainly something we like getting involved with. The energy market coming up again is one of these. As you know, Libya, Nigeria, and west Texas are producing some 20-30% above what they were expected to produce as far as reference to oil production. If you take west Texas, Libyan and Nigerian extra barrels that they are now producing in excess of what people were expecting, it is going to come extremely close to what the OPEC production cuts were. So, Michael, if you look at it that way, the production cuts that were creating quite a bull stare in the market this summer, that seems to be coming to an end based on the fact that production is going to equal out with the extra barrels coming from those other locations. Michael: The media really hit that hard and talked about the OPEC cuts and the bulls came out of the woodwork. It didn’t seem to have much of an effect, and now you’re saying that it may have no effect on supply whatsoever, being made up elsewhere. So, as we head into fall, we’ve already taken away one of those big bullish bullets, so to speak, is what they were hanging their hat on. If we look at a seasonal chart, which if you are getting the upcoming newsletter we do have this featured prominently in there, but James, we see crude oil going into the 5-year seasonal average here, and it tends to start falling pretty dramatically in September. Now, we talked about fundamentals and underlying fundamentals driving the seasonal, but what are the fundamentals that tend to happen this year that tend to cause that price decline? James: Michael, that’s a really good question, and a lot of our listeners and clients probably have the same question. It’s basically we are looking at a balanced to over-balanced oil market; however, in the months in June, July, and August, the United States, which is the largest consumer of energy in the world, heads out for driving. It is driving season and if you think that that’s just a saying, it truly does matter. When you have some 300 million people that have vacation ideas versus stay-home ideas, that makes an enormous difference to the consumption of gasoline in the United States. In July and the first half of August, the United States set all-time records for consumption of gasoline. That is what has propelled the market here for the last 4-8 weeks that got us out of the 40’s. It got us up to $50 a barrel in crude oil. However, the magic is, starting in September and then October, all those driving ideas and all those vacations are now pictures in albums, or should I say pictures in people’s Apple iPhones. People are sitting at home and they’re digging in for school and fall, and that makes a huge difference. We think that seasonal is setting up practically perfectly again this year. Michael: So, you’re somewhat bearish as we head into fall, here. I know you’re going to be doing an interview with Bloomberg in New York next week in-studio, and you’ll probably be talking about at least partially about the crude oil market, so this is something that our listeners want to hear now is to not only what we think it’s going to do but why we think it’s going to do it. You’ve already covered a couple aspects of that. Let’s just talk about supply here briefly. We’ve talked about the seasonal, we’ve talked about OPEC, which is kind of a non-factor right now in your opinion. What about U.S. supply? What are we looking at there? James: The U.S. supply usually comes down during these large driving season months, and it has done that. We are some 3-4% below all-time record levels that we had earlier this year and late in 2016. So, the supplies have come down. Generally, that’s a very seasonal pattern. We’re not producing any extra oil or gasoline during the summer months. It basically stays pretty constant throughout the year. The seasonal factor then is the less driving that happens in September, October, and November – they call it the shoulder season. Basically, it’s after driving season and before winter hits. That is when the U.S. supplies will start increasing again and whether they hit a new time record this fall, or not, we’re going to be pushing at levels that is way more than what the U.S. needs. Of course, you have OPEC nations that will likely be scrambling and probably fudging a bit on the compliance with their production cuts that a lot of people talked about. What’s so important to know about oil is a lot of these countries, OPEC nations in particular, they have a specific amount of income that they need from their oil production. When oil is sitting at $50, it is pretty constant; however, if we start getting in down to 42, 40, possibly below 40 later this fall, they’re still needing the same amount of income from oil production. That is where it could get a little bit of a slippery slope for oil prices this fall when countries like Iran, Nigeria, Libya, and Saudi Arabia need to produce a certain income for their country and for their needs, and yet oil might be at 10-15% below the price. Then, the barrels start to flow and that’s what’s going to get probably interesting here on the downside here in the months of October and November. Michael: James, that’s a great point. You talked about OPEC and addressed it earlier that OPEC’s potentially cheating. A figure I know that we discussed a few weeks back was although OPEC is still “supposedly” under the restraints of the cuts, exports of oil out of OPEC nations hit a record in July- 26.11 million barrels a day. So, maybe they’re pumping a little bit less, but they certainly haven’t stopped selling it any more slowly, have they? James: Well, Michael, that’s the exact thing. Certainly their storage facilities and producing nations, as well, not just here in the United States, and that’s basically a way to get around the quota. They’re keeping oil flowing through export channels and, yes, lightly reducing production; however, what does that mean? That means the world is supplied, in some cases over-supplied, with oil. It’s interesting, later this fall and early this winter we could have millions of barrels more than what the world needs. Yet, if the world is producing just one extra barrel the price goes down. So, we do have some interesting times coming up in oil. We really like the idea of selling calls above this market for the next 6-month time frame. As you know, there are never any sure things, but we really like the idea of selling oil calls some 20-30% above the peak that they hit in summer as we go into the fall low-demand season. Michael: Okay. Yeah, a lot of people that listen to this or maybe watch some of our things think that to sell this we have to have oil prices go down to make money. While we think that possibly could happen, that doesn’t necessarily have to happen for an option selling strategy to be successful. James, just one more thing I wanted to throw out here, you were talking about supply levels and I pulled up some stats here while we were talking. You made a good point that supplies you’re down this year over last year, about 5.3% below where they were last year at this time, but we were at record levels last year. Even at current supply, we’re still 22% above the 5-year average. We’re certainly still in a burdensome supply situation as far as that goes. As we head into the winter months here, you’re talking about particular strategies, do you like selling naked here? When you look at it, is there a strategy that you could put together for a spread? I know we do a number of different things in our managed accounts, but maybe just for the individual investor listening… any advice for those guys? James: You know, Michael, I think some of our listeners actually take positions on our discussion, and other listeners are probably learning about selling options possibly on their own for the first time. Just as a pure speculative position for a listener is to simply take a look at selling calls, and I would say naked calls yes. Certainly we do have spread analysis we do as well in positions that we take that are covered. With oil trading around 48 and, in my opinion, probably going down to the low 40’s over the next 2-3 months, I would sell calls in the $64, $65, $66 level going out, say, 6-9 months or so. The conversation about selling naked options, I think they use that word for a reason to scare people away from doing it, but people who take a short position on oil at 48, they may have to sit with that position for a while and it may jostle around above and below their entry level. Selling calls at $65 is some 30-35% above the summer highs that we’re hitting. We’re doing it using timing, using seasonal factors, when oil will likely get down to the low 40’s, and think of how far out-of-the-money you are at that point. I would simply sell mid-60 crude oil calls and put a stop-loss on it that you’re comfortable with. Something tells me that somewhere between Thanksgiving and the holiday season that option is going to be worth about 10% of what you sold it for. We’ll have to wait and see, that’s what makes a market. That’s how we would invest in crude oil going through the rest of the year. Michael: Okay. That naked term, I think, scares a lot of stock options sellers, too, because they’re used to selling 1 and 2 strikes out-of-the-money. Of course, in commodities, we can sell much deeper out-of-the-money. We’re going to talk a little bit deeper about that later. What you’re talking about is we’re taking a position above where the price was at the highest demand point in the year and we’re taking that position heading into the lowest demand point of the year. So, those are certainly the type of odds you look for and, hopefully, if you’re listening you picked up on what James was saying and how you might go about that. If you would like to learn more and get a little bit more analysis of the crude oil market, we will be featuring in our upcoming September Option Seller Newsletter. That comes out on or around September 1st. You’ll get that in your e-mail box and, of course, a hard copy as well if you’re on our subscriber list. If you’re not a subscriber and you’re a high net-worth investor, you can subscribe on our website – optionsellers.com/newsletter. James, why don’t’ we go ahead and move into our second market here. Something you featured earlier in the month but it’s an ongoing opportunity, we feel, and that’s the coffee market. We’re rapping up the Brazilian harvest. Of course, Brazil, the largest producer of coffee in the world, and thus events in that country can have a major impact on prices. I know you’ve been following this pretty closely, James. Do you want to give kind of a summary of what’s going on in the ground of Brazil? James: Michael, some of the most ideal growing and weather conditions are happening right now in the southern hemisphere. Brazil, of course, was basically one large forest. Whether some people like it or not, the forest was cut down and coffee, sugar, cocoa, and soybeans were all planted in their place. That rainforest is just one incredible farm that feeds the world. What’s happening right now in Brazil is practically ideal conditions for productions of, especially, coffee. Coffee acreage is absolutely giant in Brazil. It’s a very large portion, especially of their mountainous regions. We have 2 cycles in coffee. One is an off-cycle and one is an on. The off-cycle obviously produces slightly less coffee than does the on-cycle. It’s basically the tree taking a rest for 12 months and then it produces the large amount again. Basically, the world is absolutely full of coffee at this point, both in Vietnam and Brazil and here in the United States. The U.S. has the largest green coffee stocks ever since they’ve been counting coffee stocks here in the United States. Also at a time when weather conditions in Brazil are absolutely ideal, we’re looking at practically perfect growing conditions for coffee in Brazil. We’re going into flowering season, which is going to start in September and go through November. If, in fact, the precipitation that has been going extremely well in Brazil is expected to continue through the rest of the year, we’re probably going to be seeing record crop production for coffee beans in Brazil next year. Basically, that entails all the fundamentals that we need to know for the entire year. Consumption stays the same- it’s always up about 1% a year. Production the next year is going to be a large surplus. It’s setting up absolutely ideal in selling options for coffee. Michael: Yeah, I saw some of the estimates. The market looks forward here- we are in 2017 but these are the futures markets. Futures look into the future. These markets are now starting to price the new crop, the crop that beans will be on the market in 2018. For 2018, as you mentioned, James, it’s a potentially record harvest. I know we had discussed there are some estimates- 58-62 million bags of coffee, which would just be gigantic. That would be an all-time record. As the market prices that, we could be in for some lower prices. I know you’re certainly looking for some prices to mitigate here as we head into our winter. Let’s talk a little bit about the seasonal since we are talking about seasonals this month. We’re pretty much at the end of the Brazilian harvest for 2017 the crop. I think as of August 1st we were about 80% done. I’m sure we’re closer to that now. What tends to happen with the seasonal price? I see we go down a little bit into the fall, then there’s a little rally in October, and after October it seems to just really fall off. What happens then? James: Michael, I think what seems to happen is investors, both speculating in coffee and users, otherwise known as commercials, they will take long positions going into flowering season. So, basically it’s not exactly a tree that coffee grows on, it’s more of a very large bush. What happens starting in October is the bush is expecting rain to develop, and then it flowers, and each flower, of course, turns into a cherry. If we have steady rainfall starting in September, a bush will flower some 3-4 times, which makes a huge difference during this time frame as opposed to if we have very small amounts of rain and then the bush only flowers possibly 2 times. Simply doing the math, you can see how important this time frame is. That is why the coffee market will start rallying in October as investors and end users want to guarantee themselves coffee prices at a certain level. Should precipitation then be ample through October, November, and the beginning of December, basically the fundamental analysis for the entire year at that point is over. So unlike waiting for monthly reports or quarterly reports out of a company that sells widgets, the production of coffee is then set in gear for the next 9 months, waiting for harvest to begin again. So, we have a rally that starts in September, it goes on through flowering season, as the weather cooperates, and all models right now are showing me that it will again this year, the price goes back down. The seasonal factors are the market falls in September. As we have harvest pressure, then we start getting a rally in September, October, and November, and then we look to sell probably very expensive call options in coffee, once again. We are bearish on the price of coffee, we are record supplies in the United States, we are going to have record supplies in Brazil, and anyone who is wondering what 60 million bags means, 6 times what is produced in the country of Columbia is what 60 million bags turns out to be. Certainly there’s no shortage of coffee over the next year or two. Michael: That’ll be good news for those of our listeners that enjoy a cup in the morning. James: Absolutely. Michael: Now James, you’ve been a proponent of selling calls in coffee most of the year now. We’ve made no secret of that. You’ve had several articles, you’ve talked to Reuters, and the whole time you’ve been moderate to bearish, but just thinking it’s continuing to sell calls is a great way to pull income out of this market, and that’s because it simply has some strong fundamentals. We don’t know if it’s going up or down tomorrow, but overall we feel there should be a price cap on prices that keeps it under certain levels. As a call seller, that’s all you really need. Now, I know you’ve been selling these and have been talking about selling them in your articles. Do you think that we’re at a point right now where you sell them or do you think since we’re heading into flowering season the better opportunity may be a few weeks or months down the road? James: Michael, as they say on TV, “That’s an excellent question”. We’ve been selling coffee calls practically all year. The coffee market has recently fallen some 15-20 cents over the last week or two, which has basically cut our calls in half in a very short period of time. I would hold off on any additional sales. We’re going to look at taking profits on our positions over the next 4 weeks or so. As listeners and people who follow along, one of the best things that could possibly happen is have a bit of a dry weather concern in the month of October. That could get prices back up another 10-20 cents that they had given back recently. I would then look to lay out coffee calls with both hands. The really interesting part about dry conditions in Brazil, if it’s just slightly drier than the farmers there would like, it’s going to likely make a difference of 1-2 million bags. When you’re talking about a 60 or 62 million bag crop that is just a drop in the bucket. Hopefully we have a little bit of weather concerns at the beginning of flowering season, get about a 15-20 cent rally on coffee, and I would be back to putting on my tuxedo and jumping back in on the short side. Michael: For those of you that would like to read more about how you can use seasonals or apply them in commodity option selling, I do recommend out book The Complete Guide to Option Selling: Third Edition. That will really lay it out for you and give you some of the key markets and key seasonals you can use in these markets. If you don’t have a copy yet, you can get it at a discount on our website – that’s optionsellers.com/book. James, we’re going to go into our lesson right now and I’m sure this is probably something anyone who has been reading or listening to us for any period of time is familiar with, but it never gets old. It’s something that bears repeating over and over. It’s something we call going deep, which is really a reference to selling deep, deep out-of-the-money calls. It’s done with a little more time on them and it’s a strategy that you’ve adhered to for some time. The common wisdom is when you’re selling options you sell them for 30 days out because you get the fastest decay, but you subscribe to the opposite theory. I think we’ve both found that when you’re trading fundamentally or seasonally, as we’ve discussed now, it’s almost optimally designed for that. Can you talk a little bit about the benefits of selling that far out and what we have to do to get there? James: Michael, it is so interesting. When you and I first discovered writing premium as an investment for clients, we were subscribing to the same ideas… 30, 60, 90 days out- that’s where the large decay is, that’s where the large curve is. Certainly, we had success doing that; however, in this day and age of computer driven buying and computer driven selling, against what the fundamentals might dictate that prices should do, we do sell options in commodities 6, 9, and even 12 months out. People who have sold options on their own would say to themselves or write the question to us, “That certainly gives you a lot of time for the market to be wrong”. My really easy answer is that it gives us a lot of time for our prediction to be right. Basically, technical factors can move the market for 30 or 60 days, whether the fundamentals had changed in that favor or not. What fundamentals won’t allow the market to do is make a 40, 50, or 60% move. So, the investors that are trading, selling options on a 30-60 day idea, and certainly they might be very successful in doing that, what we don’t want to have happen is have a technical move in a market with no fundamental market change and us get stopped out. We are paid to wait. Most investors have a very difficult time doing that. When you know what the fundamentals are, waiting is quite easy and, as a matter of fact, waiting is fun because you’ll see technical buying or selling in gold, coffee, or oil all the time. Yet, it’s not reaching ever a 50% move; however, it does make the news and it makes options expensive. That’s just the way we like it. Michael: That’s some really good points you brought up there. It reminds me of a story of why we started doing this in the first place. For investors listening that have sold close-to-the-money options, you know it requires a lot of effort and babysitting. What James is talking about, going further out in time, allowing you to sell much deeper out-of-the-money, not as concerned about those short-term random swings, higher odds. Probably one of the most overlooked benefits is lower stress, both to the investor and the trader. James, I know many people might not know that you and I, when we first started out, were retail brokers. So, about 20 years ago when we first started working together, we were brokers and we were making these trade recommendation to people and we were trading options 30, 60, 90 days out. A lot of the time, they did very well and they were very successful, but it was a high maintenance type of trading. You and I would be on the phone all day because people would be calling in and we’d be changing orders and changing positions and writing new because the market was moving and the options were always moving. When we switched to the strategy of selling deep out-of-the-money options, once that conversion was done, it was crickets. There was nobody on the phone and there was no reason to call. So, it was a lower stress for the trader, but as an investor, I don’t want to say you never have to watch it if you’re managing your own account, but certainly it’s a lot less maintenance than it is if you’re trading those short-term options. It’s almost like day trading, wouldn’t you think? James: Michael, I remember making that switch to much further out dated options. It’s so funny you bring this up. We did get one or two phone calls, and I remember one, it was from one of our favorite clients. He said, “James, I just love selling options this way because I’m such a bad trader.” Once you get that mindset, that you’re no longer gambling, you’re no longer betting on the spin of the wheel or the roll of the dice, when you’re actually taking fundamental analysis, if you possess it, and turning that into an investment, this is just a great alternative to what some mainstream investments are. Taking long-term views, treating this as an investment, once you made that switch, I know how it was for us, I would never trade a futures contract again. Selling options on commodities this far out based on fundamentals does give you the patience to wait. Let’s face it, that’s what the big money does and, U.S. listeners, that’s where you want to be, too. Michael: It’s hard to put a price on sleeping at night. I think that’s a good place to wrap it up this month. Obviously, these days, James and I offer fully managed portfolios. If you’re interested in a new account with us, I’m just looking at the sheet here, it looks like we are fully booked for September; however, Rosemary is currently booking interviews now for October openings. So, if you are interested in exploring the possibility of a managed account, you can certainly call her at the main number. That’s 800-346-1949. If you’re calling from outside the United States, the number is 813-472-5760. You can also contact her via e-mail. That is office@optionsellers.com. She will schedule you with a free consultation interview to find out more about our accounts. Obviously our recommended opening account is U.S. 1 million. Rosemary can certainly provide you with other details on the accounts, as well. James, thank you for your insights this month. James: Michael, always my pleasure. I just love chatting about what we do. Michael: Great. For all you listeners, have a great month of option selling. We will talk to you again in September. Thank you.

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Will Gold's Rally Continue?

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Play Episode Listen Later Sep 25, 2017 29:53


Michael: Hello, everybody. This is Michael Gross of OptionSellers.com here with your monthly podcast for September 22nd, 2017. I’m here with head trader, James Cordier. James, welcome to the show. James: Thank you very much, Michael. Always looking forward to them. Michael: Boy, we had kind of a quiet summer and then, all of a sudden, in September a lot of news stories breaking and we saw a lot of volatility start to come into the commodities markets, at least in some commodities, not so much in stocks. James, do you want to talk a little bit about that? Tell us what’s going on. James: Michael, that’s a really good point you make. Often, they call them the dog days of summer just for that reason. A lot of investors and traders alike are kind of taking off June, July, and August. As we went from August to September, a whole lot has been hitting the wire. We have Kim Jong Un lighting off his rockets, yet again. We have interesting things happening in Washington D.C. lately, and there’s always a lot of talk about the value of the stock market, how high it is, and, of course, interest rates in the value of the dollar. Practically hitting on all cylinders here as we start getting ready for the 4th quarter of the year. Michael: Obviously, as commodities options sellers, that is a good thing. If you’re listening, you certainly want volatility. That’s what makes those deep out-of-the-money premiums fatten up a little bit. In addition to what you talked about, James, I know we had a couple hurricanes blow through here, too. It did some things with energy prices, orange juice, and I know you were on CNBC this month talking about that and also Fox Business. A couple commodities there were affected by the storms. James: You know, Michael, you really have to stay informed being a commodities investor or trader. 12 years ago, when we had these hurricanes hit New Orleans, just amazing havoc on oil production and natural gas production. A decade later, practically the same regions are getting hit and people racing to the options screen to buy calls in natural gas and buy calls in crude oil. The storm that hit Houston did absolutely nothing to commodity prices, such as natural gas and crude oil. It did pump up the price of gasoline, as you can imagine with the refiners going down. Boy, was that a great opportunity to sell options as people were watching the news and the weather channel that weekend. Michael: James, that’s a good teaching lesson, too, because I know something you talk about is the people that trade by following the news, and what you always talk about is if you know the real underlying fundamentals, those can be opportunities to go in and sell premium on people selling off the news that aren’t really familiar with the real story and how that could likely really affect prices. James: Well, it’s interesting, Michael, we just go through our day to day business and we’re familiar with the new production areas of natural gas and crude oil. Basically, the Gulf of Mexico 10 years ago was everything, and now they’re producing oil in the Dakota’s, Pennsylvania, Oklahoma, Kansas, and Arizona now for a huge find. You know, you definitely want to be on top of that when the normal investor comes in racing to buy energy calls. We’re more than happy to sell them based on the fact that we probably felt very little impact from the storm this year, and certainly that’s kind of the way that played out. Michael: Well, great. If you’re listening and you’d like to watch James’ interviews on both Fox and CNBC on those commodities, they are available on the media page of our website – that’s OptionSellers.com/media. James, let’s go ahead and move into our first market this month. The gold market: a market that even a lot of non-commodity traders follow. We’ve seen some pretty good strength in the gold market through, not just this year, 2017. Gold prices have been pretty strong, but especially through the months of July and August. We’re off a little bit now in September, but what’s going on there? What’s driving this rally right now? James: Well, Michael, as we often talk about, a lot of investors want to be diversified from the stock market. I think a lot of investors have a particular amount of money in, of course, securities; however, when they are watching all the situations around the world happening and playing out on TV, they see a falling U.S. dollar. The dollar is down some 12% or 13% this year, if you can believe that. Basically, the gold market will mirror to the opposite direction whatever the dollar is doing. You throw in Kim Jong Un and you’re really causing some jitters. It really wasn’t a big surprise that the gold market did rally some $100 over the last month or two. It has been putting on a pretty decent show. It has actually outpaced the stock market for the first time in several years. Michael: James, I know gold is one of your favorite markets to trade, especially given the current levels of volatility. We’re going to give listeners a view into some of our privately managed portfolios with this trade, but that’s fine… we think it’s a good teaching example. I know you had written strangles on there, we had talked about it this summer, it was on our website, you had talked about writing gold strangles. We had some of those on the market that started to rally, and you said, “No, we’re going to let it go. We’re not going to close out those positions on the call side just because we’re getting a little strength here.” Do you want to explain that position and your rationale behind that decision? James: Michael, a strangle on some of the commodities that we follow really gives the client an incredible amount of staying power. If you’re long gold from $950 by selling puts at that strike price and you’re short gold, for example at $1,800 an ounce by selling calls at that strike price, it really gives an extremely large window for the market to stay inside. Generally, gold over the last year or two has been kind of meandering up $25 and down $25. With the recent weakness in the dollar, and the geopolitical concerns that we’ve had, especially with North Korea, the gold market rallied real rapidly- practically $100. It went from $1,260 to basically $1,360 an ounce almost overnight. Our short positions did pressure us a little bit. Basically, I really had a strong feeling that the 3rd leg of pricing gold is inflation. Yes, you can have a weak dollar- that’s bullish for gold. Yes, you can have geopolitical concerns- that’s bullish for gold. The missing piece to the gold market rally is inflation. Basically, gold is a hedge against inflation and, as we all know, Japan tried creating inflation with 0% interest rates. Here in the United States we’ve done the same, and there simply isn’t any. We thought that the rally in gold would be short lived and we’re not exactly sure, day to day, where it’s going to travel to, but we backed off a quick $60 or $70 over the last couple of days and we’re very glad we stayed with our short positions in gold. It’s not getting to $1,800, at least it doesn’t look like from my desk, and any time it rallies we’re going to be likely selling it over the next 6-12 months based on the same idea- no inflation. Michael: Boy, that’s some great lessons in there if you’re listening and you’re just learning how to sell options. James is talking about selling calls deep out-of-the-money, high above the market. We had strikes on both sides, puts and calls, so when gold market rallied, if you’re short futures you’re probably getting stopped out there, or even ETFs you’re taking a beating, whereas our strategy with selling both sides of the market, even though those calls got a little bit of pressure, the puts were making up for some of that on the backside. When gold inevitably starting coming back down, the premium comes out of those in a hurry, doesn’t it James? James: It really did. A lot of the calls that we were short were double the value that we put them on at. We are now profitable our short gold calls in less than a week. It’s just a great lesson for people listening in and following us and for ourselves, as well. We learn on every single trade we make. Using our compasses, we thought staying short was the right idea and we continue to think that probably through the end of the year, as well. Michael: Good. Something else you bring up there… the option doubled, we held them, and a lot of people that read the book or read some of our materials say, “Well, I thought you were supposed to get out when it doubled.” That’s an excellent point and we’re going to be talking about that a little bit later today and today’s lesson. One of the reasons is we had a strangle on so we had a lot more leeway, but we’re going to talk about risk management here and some more advanced strategies later in the podcast here. For now, James, I know I said I wouldn’t put you on the spot, but the title of today’s podcast is Will gold’s rally continue? What are your thoughts here through the end of 2017? I know our job isn’t to pick what the market’s going to do, we only have to pick what it’s not going to do, but for people listening, maybe they don’t do this yet, maybe they’re thinking about selling options, but what’s your gut feel here? Do you think a rally continues through the end of the year or do you think we may be reaching some value levels here? James: Michael, that is a great question. The gold market is something near and dear to many investors. You can talk to clients about the price of cocoa, they might not be familiar with where that’s trading at, or soybeans, but a lot of investors know what the price of gold is trading at for one reason or another. They probably have some stashed away or it’s something they might be interested in purchasing. The gold market has a personality. It’s not necessarily all supply and demand, like soybeans or crude oil or coffee, a lot of it is perception. One week ago, the North Koreans were slapped with the harshest situations as far as deterring trade, you know, going to that country. The sanctions that were levied on them were thought to be the strongest ever. Two days later, Kim Jong Un is lighting off missiles. That seemed to really ratchet up the rhetoric and the tensions that day. The gold market traded up $7 that night. The following day after the day traders were able to get a hold of the price of gold and trade it, it closed lower the day after Kim Jong Un was lighting off missiles. That tells you that that market had topped out. Certainly, hindsight is 20/20, but it did fall some 7 days in a row since then. That tells us that a very important top was made in gold for the remainder of the year. I think fair value for the beautiful shiny yellow metal is probably $1,275 to $1,300 and we have a decent economy, we have no inflation, we have interest rates about to rise, and that is going to take a lot of the steam off of the bulls, as far as the gold market’s concerned. If you read the Wall Street Journal just 2 weeks ago, it went on and on about small investors are long, ETFs are long, large investors are long. If you follow along with that, investors listening to us today, that basically means anyone who wanted to buy the market was already in, and you’re going to see large investors pull out and take profits when that’s the case. I think that’s what we just saw and we just made an important top in gold that will probably last at least the next 3-6 months. Michael: All right, that makes a lot of sense. As far as investors maybe looking to trade gold or maybe use some of our strategies, obviously a rally like this helps us because it pumps premium into those call options. Even after the sell-off, do you think there’s still an opportunity there for investors to go in and still take premium on the calls side of this market? James: I think so. We have a couple of important announcements by the FED over the next day or two. We have some very large decisions made by the EU coming up over the next week or two. You can basically play the middle of gold right now if you just can’t fathom being short the gold market and you can’t fathom having a short gold call in your portfolio. We really like selling the 1050 gold puts, in other words the $1,050 gold put strike. We think that’s a great idea, but we are neutral to negative gold. We don’t see it going that low. That’s some $200-$250 lower than where we are right now. That’s a great window for gold bugs to participate in being in the shiny metal. Being neutral to negative I would sell the $1750-$1800 gold calls. I think that is a very low hanging fruit and I think the beginning of next year those would start being very profitable for anyone selling those. Michael: So, that’s for gold. That’s about a $700-$800 profit window that gold prices can move around and still those options would expire worthless. That’s a pretty wide range. James: You know, trying to get gold’s next $25 move is difficult. Can you imagine how many small investors and large investors alike poured into gold here the last 30 days? They’re probably going to be waiting maybe a year or two to see the market come back to that level or get slightly above it. Positioning yourself $500 above and $200 below, I know that’s not the typical investment in gold, but if you take a look at it, it might be for more investors than what they might think. Michael: Good. James, I know you’ve been tweaking some strategies here. Some of our strategies we’re going to be using for our privately managed clients as far as option selling goes, but if you heard James’ commentary here, for anyone listening, he’s just giving you a sample strategy you can possibly even use at home of a gold strangle. If you’d like to read more about strangles and other option strategies we recommend, I do suggest our book The Complete Guide to Option Selling: Third Edition. If you’d like to get a copy of it for a lower price than you’ll get at Amazon or at the book store, you can get it at our website, OptionSellers.com/book. James, let’s move into our second market this month. We’re going to move over to the grain markets, in particular the soybean market. For those of you that have listened to our commentary over the last 4-8 weeks, we’ve talked a lot about the upcoming harvest, and seasonally in soybeans, harvest time is when supplies will be at their highest. Typically, when supplies are at their highest, Economics 101 dictates that’s often when prices will fall to their lowest level. That’s why you see the seasonal chart tends to decline right into the fall and October is when harvest tends to get in full swing and then wrap up at the end of October and early November. So, often times you’ll see prices make a low around that time of year, but then something different happens. We kind of reversed that. James, do you want to talk a little bit about that? We have a change going on possibly this month in the seasonal pattern of soybeans. James: Yes, Michael, that’s exactly how it follows out. I’ve been looking at soybean seasonal charts here quite a bit. I have one very near to me right now. June and July we have weather scares and the soybean market rallies. It falls off as the scares seem to be not as defined as previously thought. The soybean market and the corn market have fallen steadily since the 4th of July. This is truly the seasonal bottom coming up practically every year at the end of September and beginning of October. Looking for a possibly different trading approach might be up on us here in the next 4-6 weeks. Michael: Yeah, and looking at soybean prices we had a pretty good nosedive into August. Sometimes that could have been a seasonal low there, I don’t know. We’ve rallied a little bit since then. We’re going to see a secondary low in October; possibly, it’s hard to say at this point. We may get the low in October or we may have already seen it in August, but the fact of the matter is after October and November prices have historically tended to start strengthening. That’s when a lot of those forward sales and those orders start to get filled and it starts to draw down inventories again and, often times, you can see soybean prices firm. Now, if you’re listening you would think, “Well, then we would want to sell puts”, but that’s not necessarily the case. James, you made a case for this in our upcoming newsletter this month. Maybe it’s the better strategy to employ the think strategy we just talked about here in gold. James: Michael, I really think it is. Seasonally, we’re going to have very good support under soybeans. At the same time, we have carryover from this year’s production practically as high as we’re ever going to see it in the past 10 years. That will likely keep a cap on soybeans. Once again, when finding a fairly valued market, that is just a great deployment of selling calls way above the market and selling put strikes way below the market. This fall and this winter for soybeans, it may be ideal for that. We have large supplies likely to hold the market down and we have a very strong seasonal tendency for the market to rally that might be the perfect equation for probably a sideways market at a time when both puts and calls are quite expensive. It might be setting up extremely well and something we’re going to be paying very close attention to as we speak. Michael: It really makes a lot of sense, because that seasonal does carry a lot of weight. At the same time, soybean stock is 475 million bushels. Not only is that going to be the highest in over a decade, but it’s the second highest in over 25 years. So, the supply levels here in the United States are pretty sizeable, yeah we could still get an adjustment in the October report, but for the most part it looks like we’re going to have a pretty sizable crop. I see what you’re saying- that could tamper that seasonal a little bit and keep prices in a nice defined range. Good thing about strangles is you’re getting double premiums. You’re getting premiums on both sides of the market. Those can be big income earners to pad an account. James: Michael, absolutely. So often, people are trying to define the next bull market or the next bear market, but when you’re able to identify a sideways or fairly priced commodity, that can be the best of both worlds. As you’re short one side of the strangle, it’s basically taking care of the other one while you’re waiting for decay. As option sellers, patience is the name of the game, and having a strangle on as your key position can really help, not only a portfolio, but help the manager taking part in deciding what to do as you have the trade on. Michael: All right… pretty good stuff. For those of you that would like to read more about the soybean market, we are featuring it in the upcoming October Newsletter. You can see the seasonal we’re talking about and also take a look at the fundamentals we’re looking at, get James’ analysis and possibly strikes you can look at if you’re trading at home. Obviously, if you’re interested in a managed portfolio, you can request our information pack on that, as well. As far as our lesson this month, James, we’re going to address something this month that we probably get more question on than anything else. It’s because it’s a very important topic and that is kind of a broad question, but it is “How do I manage risk on my short options?” We do have a whole chapter dedicated to this in The Complete Guide to Option Selling. We talk about it a lot in our videos and seminars, but I think we should cover it here because there’s a little bit of confusion as to what’s the best way, what’s the right way, etc. What we’ve put forth in our book is what we recommend to beginners, people either new to commodities or new to option selling, is the 200% rule. It’s a good basic rule; it keeps you out of trouble, if the option doubles then you end it, end of story. We still think that’s a good rule and I know you think that’s a good rule, as well. When we’re managing a portfolio with $100 million in it, we have the ability to have a little bit more leeway, we can use a little bit more advanced techniques to bump our odds up a little bit. I know there’s a couple you use and I thought maybe this month we’d pull back the curtain a little bit and let people see some of the more advanced techniques that we may use in managing our portfolios. Do you want to talk about that a little bit, James? James: You know, Michael, we make a great deal about fundamental trading simply using the 200% rule and, if you’re trading along with the fundamentals, I think a portfolio would do very well over a 1, 2, 3 year period. As far as making a more sophisticated exit level and risk parameters, we do utilize more parameters than just the 200% rule. Basically, we’re going to sell options on what the fundamentals dictate. If there’s too much cocoa in the world then we’re going to look to sell calls. 9 times out of 10, the fundamentals in cocoa that brought us to get into that position won’t change over the next 6 months. Generally speaking, a rally against the fundamentals is technical in nature and we can watch open interest, we can see who’s actually doing the buying and who’s doing the selling, and if it’s technical in nature and possibly the option did reach a double level or even more so, I’m going to look at the landscape of the cocoa market or the gold market, whatever the case may be, and if the fundamentals remain the same we will give that trade more leeway. If, for example, we were talking about gold earlier, and all of a sudden we are getting inflation and inflation is at 2, then 2.2 and 2.4 and 2.6, that is a change in fundamentals and you would definitely want to use the 200% rule. As a matter of fact, in a case like that you may not wait for it to reach that level. Being nimble selling options, there’s nothing wrong with that. If you simply want to use the 200% rule, I think, over a 3-5 year period you’ll do extremely well. We follow the fundamentals in commodities so closely that often it’s a technical rally or a technical decline in the market and, for that reason, we’ll stay with a position longer than just a simply percentage rule. Michael: So, you’re saying that’s why you sell options so far out-of-the-money. You give it so much space to move and you have a little bit more leeway because you may have a little bit more insight into what’s actually going on with prices. For the guy out there on the street that’s saying, “I like this 200% rule, but what if I want to employ something else? What if I am looking at some other things?” I know you’ve used a couple of things, but one of them is at times if the fundamentals stay the same you may roll part of that position. Can you talk a little bit about that? James: Absolutely. If you’re selling puts because you’re bullish the market and it’s falling, you might want to scale back a half of your position that you have in the puts and then just roll down to the next 1 or 2 strikes below that. Generally, the selling or the buying based on technicalities will be short-lived. You don’t necessarily just want to leave your position because of something a headline that was in the Wall Street Journal or one of the business channels. Rolling your position allows you to stay with your initial fundamental analysis. Michael: That makes a lot of sense, too, James, because I know when you get into rolling and, another strategy you mentioned is gradually scaling out a position rather than just closing out the whole thing, that gets into a little bit more art than science. It gets into kind of a feel for the market kind of to know what’s moving it. For the person that has just joined us on their own, they may not have the skills to employ that art, whereas the 200% rule is very scientific, it’s very numerical, it’s very definite. Yeah, you’re probably going to get out of a few trades that at the end of the day they’ll still expire, but it’s the only way to keep you out of the ones that are going to cause you trouble down the road. That’s a great point to make and for those of you listening, if you would like to learn some of our more advanced risk techniques, we mention a couple in The Complete Guide to Option Selling, as well. We also talk about them in some of our upcoming videos that you’re going to see this fall. So, if you watch our videos on our blog, we’re going to be talking a little bit more about the risk management, as well. Just a little housekeeping here before we go this month. For those of you interested in discussing a potential new option selling account for the 4th quarter, we are fully booked for October. Rosemary is currently scheduling consultations for our available openings in November. We do have a few of those left. If you would like to schedule a consultation, feel free to call her at the main number… 800-346-1949. If you’re calling from outside the United States, you can reach her at 813-472-5760. You can also inquire on availability by e-mail… that is Office@OptionSellers.com. James, thank you for your insights this month. James: My pleasure, Michael. Always enjoy being part of the show. Michael: We will talk to you all next month. In the meantime, have a great month of option selling. Thank you.

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End of US Planting Can Be Opportunity for Grain Option Writers

OptionSellers.com

Play Episode Listen Later Jun 1, 2017 27:24


Michael: Hello everyone. This is Michael Gross of OptionSellers.com here with head trader, James Cordier. This is your monthly Option Seller TV Show. James, welcome to the program this month. James: Always a pleasure, Michael. Glad to be here. Michael: We have a lot to talk about this month. We have turmoil in Washington, we have some activity coming back to the VIX, and we have OPEC announcements, so there’s some volatility coming back into a lot of the markets. We’re going to talk to James about how that might affect some of the commodities we’re looking at. James, what’s your take on the new burst of volatility we’ve seen? James: Well, Michael, there is a lot of uncertainty right now. The stock market continues to meander and make new highs practically once a week, it seems, to get a new sell-off, and then buyers come back into the market. The VIX, which has been in the news recently, under 10, which I believe is about a 2 or 3 decade low, basically is saying that there’s no fear amongst investors, continue to pile into the stock market and continue to buy. The volatility index is just starting to pick up, however, in commodities. We’ve seen a dramatic move up in basically the energies and some of the metal VIX indexes, and it tells us that there is some ideas that some large moves in either the stocks or in the dollar denominated commodities might be approaching soon. Of course, we like the VIX going up – that increases premiums on both puts and calls that we follow. Michael: Now, is that spilling over from equities or anything going on in Washington, or is that happening on its own accord for different fundamentals going on in the commodities? James: I think a lot of investors are taking the cue from what’s happening from Washington and abroad. We have North Korea, we have a situation with Russia and the election, we have things going on in the Middle East right now along with Washington D.C. and a lot of the proposed changes are meeting some stone walling right now that’s going on. It is causing a lot of uncertainty and, of course, that’s something we enjoy following. Some investors don’t care for that very much but it’s certainly something that we like to see happening and it pumps up premiums on commodity options. Michael: Well, with that background setting for the month, let’s move into our first market. We are going to talk about the grain markets this month. June is a big month in U.S. agricultural markets. This is typically the month where planting is completed in markets like corn, soybeans, to a lesser extent wheat, cotton, and those type of things. When you look at seasonal factors, the end of planting season can play a big role in that. James, maybe you want to talk a little bit about what that often means for certain grain prices? James: Michael, a lot of our viewers and listeners here today hear us talk about seasonal factors. Corn and soybeans, a lot of people don’t realize, are practically everything that’s consumed. Whether it’s in China, Europe, or here in the United States, it comes from a kernel of corn or from a soybean. Practically everything we eat, dining out or cooking at home, that’s what takes place. Corn and soybeans are an absolute essential to the food system for practically everyone on the planet. It’s a huge market. The corn and soybean market basically has some type of fear or anxiety going into planting season. The planting season has to be just right or a lot of investors feel that we’re going to have smaller yields and possibly a smaller crop. Generally, it’s either too wet or too dry or too hot in May or June, and that does bid up prices often. Generally speaking, at the end of that rally and once the corn and soybeans are planted in the United States, of course, prices then come back down to earth and, lo and behold, the U.S. farmers are some of the best in the world and sometimes a bumper crop. (4:18) Michael: Now, when we talk about a market like soybeans, we didn’t really see that big run-up this year. We had relatively stable planting season and I think that kind of moves us toward what the fundamentals were this year. There’s a reason we didn’t really see a big run-up in the spring. Would you agree with that? James: We certainly haven’t seen that run-up yet. Right now, we have soybeans and corn planting just about on schedule. There was some ideas that there would be delays because of too much rain, but boy… too much rain makes a lot of grain later on this year. There still might be one or two rallies in June or July, possibly, there’s a dry spell in there somewhere. People are also talking about El Niño, which can certainly change weather patterns here in the United States. For the most part, the fundamentals are already in gear for low grain prices at the end of this year. Ending stocks, of course, are extremely high and production out of Brazil is at all-time record highs. So, if we get this weather rally sometimes in June or July, that would probably be a selling opportunity. Of course, for our clients, we are already short the grain market based on the fact that, like you said, the fundamentals right now are going to probably overwhelmed seasonal factors this year. I think we’re on the right side of that market. Michael: I know you were a proponent of selling calls this month. As far as ending stocks go, as you said, global ending stocks are “over 90 million metric tons”, which would be an all-time record for world ending stocks for the ‘16-‘17 crop year. When we’re going into this seasonal time of year where prices often start to weaken in the summer, as you were talking about, we’re going at with a backdrop of record global supplies. Even though prices have come down, I know you were very interested in selling call options on soybeans, not necessarily because you think the bottom’s going to fall out just because you think it’s going to have a hard time rallying in this type of environment. Is that correct? James: Exactly, Michael. Of course, as option sellers, we’re not exactly trying to predict where the market’s going to go but, of course, where it’s not going to go. With world ending stocks at all-time record highs, record production out of Brazil and Argentina, record production likely here in the United States. Do soybeans fall 5-10%? We’re not sure, but then going up 30%, of course, seems very unlikely. Of course, as option sellers, we are basically betting where the market is not going to go as opposed to where it has to. This year, with record ending stocks and just huge supplies from everywhere, a 30% rally in prices seems quite unlikely. Michael: Great. If you want to read James’ feature article on the soybean market for May it is on the blog. You can go back and take a look at that where he really outlines the case for selling calls this month. For those of you that would like to read more about seasonal tendencies and the agricultures or other commodities, you can also read about it in our book, The Complete Guide to Option Selling: Third Edition. That is available on our website at OptionSellers.com/book. James, lets move into our second market this month, which is the crude oil market, which we’ve certainly seen a lot of developments there. A lot has been in the news about crude this month. There’s big talk of OPEC. In fact, today right before we came on camera, we just had a big announcement for OPEC. Do you want to talk a little bit about that and what’s going on there? James: Well, Michael, ever since you and I have been in this business there has been the old adage of buy the rumor and sell the fact. I think that happened in great text today as the OPEC nations and non-OPEC nations decided, and certainly have been discussing for a long time, to extend the production cuts that were announced approximately 6 months ago. They were going to now announce that there were going to be 9 months of further production cuts. Certainly, that has been well advertised. The market did rally on those ideas over the last few weeks. I think crude oil went up from around 48 to 52 recently based on the fact that they would be extending cuts. Today, the cuts were announced that 9 months would be prolonged into the smaller production of many OPEC and non-OPEC nations. The market answered that with a resounding $2 down and the price of oil went from 52-50. Basically, the world is awash in oil, and if the fact that production cuts are going to be extended, they weren’t really that bullish to begin with. Of course, what’s happening in the United States that we might want to talk about is really the deciding factor and what’s changing oil prices. Michael: I know, even going into these cuts, you weren’t really bullish on crude and that was because of the supply and the production situation in the United States. Is that correct? James: Correct. Going into the large announcement from OPEC and non-OPEC nations some 6 months ago, very few people are familiar with the fact that weeks leading up to the announcement, OPEC ramped up production to levels never seen before. Though they did cut for the first time in 10 years, or something like that, production just prior to that went up a million and a half barrels. So, cutting and announcing a 1.5 million barrel cut really doesn’t move the needle at all. Of course, here in the United States, mainly the Permian Basin in Texas, production is now ramping up into all-time record highs. If in fact the U.S. does start producing 10 million barrels a day, which is looking like it will happen late this year or early next year, that completely erases the cuts from OPEC, which were thought to be so bullish, and the bottom line is if we have one more barrel of oil than we need the prices go down. Right now, it looks like we’re going to have approximately 1-2 million barrels more per day than we need going into 2018. The real key is going to be can OPEC stay together, be cohesive with these cuts when prices start to fall in the 4th quarter of this year. They’re going to have to hang tough because if they start cheating, this thing can really snowball and come down. We don’t’ see that happening. There’s something going on in Saudi Arabia as far as their first IPO of the largest extent ever seen before, and they’re going to do everything they can to keep oil prices high. Michael: That in the backdrop of last energy report here this month, still looking at record supplies for this time of year in the states. I think were 528 million barrels or something like that, which is an all-time record for this time of year. All this news, they’ve really been playing up this OPEC deal in the media for the last couple of weeks. Yet, here we are with a backdrop of record supply. A good point you brought up as well in the newsletter was how U.S. frackers have really ramped up production. I think we’re at 9.3 and I think you said we’re headed to 10 here at the end of the year. You can see right where they made those cuts and you put a good chart in the newsletter of where U.S. production starts trekking up again, just making up for what OPEC wants to give away. James: Exactly right. It is an absolutely gift to the frackers here in the United States that OPEC and non-OPEC nations are cutting production. It’s keeping prices still relatively high, giving new developments here in the United States chances to lock-in hedges. We were reading in the Wall Street Journal today that no longer are producers in Texas and North Dakota and everywhere in between, they’re not so susceptible to the large moves in the price of oil. They’re getting very sophisticated. A lot of areas, especially in the south, they’re able to produce oil anywhere from $20-$25 a barrel, some as high as maybe $30-$35, but they are now locking in future production using the futures market. When you can produce oil for $25 and sell it for $50 and lock that in, that’s what they’re doing. They’re taking advantage of that. As prices do fall, possibly in the 4th quarter this year, they don’t feel any pain. They just keep pumping because they’re locked into futures price at $50 printing money basically. What that’s going to do is exasperate the overproduction and the large supplies, we think, and then we could look at some prices possibly in the low $40’s to $40 later this year. Michael: Now, one more thing to talk about here as far as the seasonal tendency goes. We talk a lot about seasonals. Seasonals have kind of been knocked a little bit out of whack since the OPEC announcement back in November, but you are thinking that with the latest OPEC moves, we might see that kind of knock the market back into alignment with the seasonal tendencies. James: We really see that happening. What OPEC will be likely be doing at the very least is coming close to balancing the market again. We’ve had this boom bust every 6 months for oil production and oil prices over the last 2 or 3 years. That did change with the last production cut announcement 6 months ago. We see a slight balancing of oil production versus consumption, and that should throw us right back into the seasonalities that we enjoy so much. We love going short crude oil just as we’re coming out of driving season going into what we call the shoulder season, which means no longer driving season and yet too warm to have to heat homes and businesses in the Northeast. That is shoulder season. The market rolls over in the 4th quarter of the year so we take advantage of selling calls here in the summer and then reverse that position later this year and beginning of next. Michael: So, although we are bearish crude, neutral to bearish, we are not positioning money that we need the market to necessarily fall. Let’s maybe talk about for our viewers that maybe aren’t that familiar with option selling yet how you would position to take advantage of this type of market. James: When we heard of the announcement 6 months ago, we thought that would probably neutralize both bullish and bearish factors. We have too much supply, however we have production cuts from OPEC. We immediately put on a strangle in the crude oil market. We did think that the seasonality would probably take a pause until the end of this year. We basically took the excitement by selling $75 calls, meaning we are betting the market can’t get to $75, at the same time putting on a strangle, and by doing that we sold $33 puts – an absolute enormous window for the market to stay inside. That position has worked extremely well. Both of those positions are approximately 20% of what we sold them for. We should now go back into a seasonal pattern where we top-out in summer. What we mean by that is if oil is trading around 50-51 currently, what we would do is look at the winter contracts, say January, February, March, and look to sell options there. If we sell a $70 call while price of oil is at $50, we are basically betting where the market won’t be. This winter, we do expect the smaller demand season of January-February to take hold of 40% rally in crude oil prices during the weakest season of the year. That’s a bet we like to make and with oil at 50 selling calls, for example, around 70, basically what you’re doing is you’re playing football. You’re not necessarily passing to where the runner is or the receiver is, you’re passing it to where you think the market is going to go. Everyone is bullish in the summer and that’s where you go short. What you do is you throw it to the receiver who is running in January when demand is going to be at its least. Michael: As far as the market goes, the bulls seem to be running out of arguments here. OPEC was a big thing a lot of them were hanging their hats on and that hasn’t taken place. Now we are into summer driving season, which they will probably be talking up a little more, but with the supply where it is right now, prices tend to actually top in early to mid summer. We are just betting it’s not going to go up. It seems like anything can happen, of course, but it certainly seems like pretty high odds position from that point of view. James: I think with what’s happened to the market here in the last 6 months, we will have some equilibrium. You have producers locking in hedges, you have smaller production, so these moves from 30 to 70 are probably behind us. Crude oil prices 40 to 55 are more likely going to be the norm here for the next few years. Selling puts and going long in the low 30’s, and selling calls in the mid to upper 70’s, I think, is going to be a cash cow the next several years. As you said, anything can happen. We will have to wait and see. Selling options 40% and 50% out-of-the-money in crude oil, I think, is going to be ideal. That market is going to start finding equilibrium and some sort of balance, and what we call historic volatility is still in when you price options. The new norm is going to be more of a $40-$50 price and the volatility that was created over the last several years allows us to sell options 40%-50% out-of-the-money. That’s why we talk about volatility. That is the life-blood of what we do. From time to time, whether it’s fear of turmoil in North Korea, something going on in the Middle East, that is ideal for us is something that pumps up energy price options and we like to take advantage of that. Michael: Hopefully the media keeps helping out with that and keeps public buying those distant option premiums. James: That’s the hope. Michael: For those of you that like to learn more about the crude oil market and our strategy there, it is our feature article in the June newsletter. That will be out at or around June 1st in your mailbox. Keep an eye out for that. Obviously, in addition to our outline for crude, we also have some lessons in there about how you can sell options and manage risk is our feature this month. So, there’s quite a bit of new information there. You don’t want to miss the June issue. James, lets move into our lesson this month. This is one we haven’t done on video yet, but it is one we have talked about in our booklets if you have received our booklets in the mail. A lot of people that call in will ask us, “How do you pick the option you’re going to sell?” It’s really a short question with a very long answer, but we thought what we could do is just provide a few bullet points that if you are looking at trying to understand how this is done, the type of things we look at when we’re selecting a trade in commodities. There is really 5 things that we look at, James, that you and I have discussed. We’ll just kind of go down that list and talk a little bit about each of them. The first one on that list is something we are very big on which is the supply-demand fundamentals of that individual commodity. Do you want to talk about how you approach that when you’re looking at a commodity? James: Michael, I think a great analogy is years ago when people were investing in dot-com companies and these are names that you’re seeing on TV, they’re names that people are talking about, and the market started falling and people are looking at dot-com companies… “My gosh, I can buy it at 50% of what the price was just a few months ago. It has got to be a great buy.” They buy XYZ dot-com company, it’s down 50% from its highs, it sounds like a great buy. Then it is down 75% from its high and people are just getting white-walled here back in the crash of 2006, 2007, and 2008. You ask that investor, “What are you getting beat up in?” … “Well, I bought this dot-com company.” “What do they make?”… Not sure. “What do they do?”… Not sure. It is very difficult to stay with a position like that. We do fundamental analysis on about 10 commodities. I’ve been trading silver since when I got my driver’s license. I’ve been trading coffee for the last 20 years. We count barrels of oil constantly to try and understand what the value might be. When selecting short options based on fundamentals, when the market moves a dollar against you or people are on TV yelling about OPEC announced the cut or the market is up or down, for an investment to work you have to have staying power. You can’t get bumped out of the market on a small move. So often, if you have fundamental research and analysis, you’ll know that when the market moves slightly against you it is just noise. Computerized trading is moving the markets a lot more than it used to. We love computerized trading, it’s making our options more liquid to trade, but it also does send gyrations through the market from time to time. Having the fundamental research already in place allows you to be patient with your position. We sell options based on fundamentals. If they are not there, or we’re not sure what they are, we simply wait 6 months for them to maybe become more clear in a particular market. We want to sell options far enough out in time and price so that small gyrations in the market doesn’t disturb our position. How often does someone who does look at selling options on commodities or stocks? They’re attracted to selling the short-term option, selling a 30-day option or a 60-day option thinking, “Well, I only have a short period of time. That’ll have to wait.” But what ends up happening is a small move knocks you out of that position. Of course, what happens once month later is that market’s doing exactly what you thought it would do, except you don’t have your option anymore. We look at selling options 6-12 months out. If we thought the sweet spot for short options was closer in than that, that’s what we would do, but I have found that selling options 6 months out-12 moths out allows you the selling power to stay in your position. We were based on fundamentals when the market goes slightly against us, we just aren’t able to have patience and let the market come to us. Michael: When you know the underlying fundamentals, it’s really giving you the confidence to stay in a position and not get shaken out by this or that or what’s on the news today, which, you know, we talk about over and over and over again in everything we do. James: Writing short options, you are one thing – you are paid to wait. If you know what the fundamentals are and if they’re on your side it makes it much easier to do that. Michael: When we’re looking at trade, we look at fundamentals first. Second thing we’re going to look at is seasonal factors, which we’ve already touched on a little bit here today with some of our other things, but seasonals kind of play into the fundamentals because they’re really just reflecting certain fundamentals that tend to happen at different times of year. James: Exactly right. With the grain market, seasonal factors are there’s fears of planting, too hot or too dry conditions in the summer, and then you go right back to supply and demand in the fall. What seasonals do is they are basically fundamentals. It tells you exactly when the demand might be the most for gasoline, when the demand for natural gas might be the least. What it does is it helps us decide whether we should be long or short that particular market. If you combine that with a supply and demand, basically you are putting everything in place to allow you to put on a position and to stay with it. Michael: So, those are going to be the 2 core factors we look at when selecting a market. Obviously, the third thing on the list is volume and open interest. We have to find a market that not only is seasonally or fundamentally favorable, but there has to be enough options in there for us to go in and sell some. If there isn’t sufficient volume rope and interest, it’s not a viable market, so that’s the third selection process. That’s kind of self-explanatory, you probably don’t need to expand on that I wouldn’t think. James: Just the algorithms and the computerized trading is just making option selling just such a pleasure right now. The volume and open interest is increasing dramatically, even on far-out options. Making sure that there’s the ability to get in and out of the market is, of course, of the utmost importance. With computerized trading it is certainly helping a lot. Michael: We are using those 3 things to really select our market. The last 2 things on the list we are using for timing. What you’ll find is the last 2 things on our list are usually the first things that most option books will tell you to look at, or option gurus or option traders. That’s volatility and the technical setup. Those are the last things we’re looking at because by the time we are looking at those we’ve already picked the markets we want to be in. we are just using those 2 things for our timing, correct? James: Exactly right, if you’re trading a 2 week or 4 week option, you do need to have perfect timing. We have done all of our homework basically telling us whether we want to be long or short a particular market. Once we’ve made that determination, we try to blend in a little bit of timing to help us sell options when they might be at their peak or close to it. The desire or the need to have perfect timing with our form of option selling isn’t there, but certainly when we can see some technical buying or selling it can increase options that we’re looking to sell maybe 10-15%. We will certainly take advantage of that when we can. Michael: For those of you that are interest in this, we do get a lot of questions on this so we are probably going to be doing some new upcoming videos on these things, how you can use them, how we incorporate them when we’re managing portfolios as well. You’ll kind of learn from both sides of that. As far as just a little update here for this month, our waiting list for accounts is booked into July now, so if you are interested in possibly working with us directly, you can call Rosemary to schedule a consultation and she is filling the final slots we have now for July openings. If you haven’t heard about our accounts yet and you’d like to learn a little bit more about them, you can request our Discovery Pack, which looks like this, and that will tell you all about OptionSellers.com managed accounts, requirements, and how you can get started in them. You can request that on our website OptionSellers.com/Discovery. We thank everyone for joining us this month. James, thanks for your analysis this month. James: My pleasure, Michael. Always enjoy it. Michael: We’ll look forward to talking to you again in 30 days. Thank you.

OptionSellers.com
Coffee, Natural Gas Markets offer Seasonal Plays for Option Sellers

OptionSellers.com

Play Episode Listen Later Apr 24, 2017 22:44


Michael: Hello, everyone. This is Michael Gross, Director of Research here at OptionSellers.com. I’m here with Head Trader, James Cordier, with your monthly Option Sellers Audio/Video Podcast. James, welcome to the show. James: Thank you, Michael. As always, it’s a pleasure. Michael: we are going to talk a little bit about what’s going on in the world right now and we are going to get into some of our key markets for this month. James, obviously anybody watching the news this month has had quite a bit to look at. We have North Korean missile test, we have Russian bombers flying over the Alaskan Coast, so there’s a lot of geo-political things going on in the world right now. It’s bringing a lot of instability into a lot of people’s thoughts about what may be going on over the next several months in the markets. The VIX and the S&P is up 24% in one week here in April as a result of a lot of this. So, just overall, what’s your take on the month of April as far as the markets go? James: It’s interesting, Michael. Over the last 6-8 years we’ve had very little of the news that we’re looking at recently. There’s a lot of muscle flexing going on by both Russia and the United States, and maybe China coming up soon. It does have Wall Street a little bit jittery. As you said, the VIX is up some 24% recently and, actually, I think the VIX was testing multi-year lows. So, it always seems that something comes down the pipe to give everyone jitters and I saw the stock markets sold off here recently on some of the concerns going on around the Middle East and throughout Syria and North Korea. I think that’s a necessity to keep traders on their toes and to make sure the stock market and other markets aren’t always on a one-way street. A lot of the traders like the hustle and bustle of the markets going up and down and I guess we do, too. Michael: Well, we’ll see what happens. I know there’s been a lot of articles as of late. Ron Insana of CNBC, they recently had an article on their website talking about the two things that most often start bear markets and one of them was rising interest rates and the other one was the onset of war. So, let’s hope we don’t have anything like that, but something to keep in mind as you’re planning your stock portfolio or stock option portfolio for the spring and summer months here. Over on this side, we’re going to get into some of the commodities that we feel may be offering some opportunity this month. First on our list is we’re going to talk about the natural gas market. Obviously energy markets is some of the most seasonal markets in commodities. Natural gas, during the month of May, can be a very seasonal commodity. James, you want to give your take on that right now and what you see happening there? James: Michael, thank you. It’s very interesting throughout the year of the 12 commodities we follow. There will be certain times, sometimes the 1st quarter and sometimes the 2nd quarter of the year, that a certain commodity has the propensity to go up or down based on seasonality. Natural gas is certainly one of those. Generally, natural gas prices will rally during the months of March, April, and May, and then we start building supplies for summer cooling needs. What a lot of people are not familiar with is the fact that to cool vs. to hear requires only 10% of the natural gas that it does during the winter months. So, quite often, natural gas has a rally going into spring and summer thinking, “Well, it might be a hot summer” and it turns out that natural gas usage to cool homes and businesses in the winter is like 10% of what it takes to heat homes and businesses in the winter. Subsequently, the rallies in spring and summer do falter. Supplies of natural gas coincide this year with the seasonality of the market falling. We’re approximately 16% here in the United States over the 5-year average. What’s so interesting right now, Michael, is areas like the Permian Basin, which has new drilling for oil, new production for oil, and a lot of people talk about energy that way. The Permian Basin has supplied new production records for the first 5 months of this year. That’s expected to continue. Natural gas production in the United States to pull a million BTUs cost approximately $1. We have natural gas prices trading around $3-$3.50 per million BTUs. That’s a whole lot of anchor pulling this market down when you can produce something for 1/3rd of what you can sell it for. That’s a lot of downward pressure. We think that natural gas at around $3.50 right now per million BTUs is probably fair value for this time of the year. Going on to summer and fall, we probably expect natural gas to tweak down to around $3, and for seasonality traders and for what we’re doing for our clients right now is we’re positioning for weaker natural gas prices for the fall and winter of this year. We are selling natural gas options, right now, double the price of the current value. This is one of our favorite seasonal plays for 2017. We just started walking into it recently and, I think, later this fall and winter, a lot of these natural gas calls that we’re selling will likely be worthless and should definitely add to one’s portfolio this year. Michael: James, that’s a good point. You’re talking about those contract months that are going a little bit further out and you’re already looking at winter 2017-2018. When we’re looking at the supplies right now, as you talked about, we are 14-16% above the 5 year average for natural gas supplies, and when you’re talking about the seasonal and you have a situation right now where this winter is over, supply is starting to build again. As the supplies start to build, obviously that means you have higher supply in storage that also coincides with lower prices because as supply rises price often goes down. So, what you’re saying is we’ll go to the back contract months and take advantage of what we expect to be lower summer prices. That doesn’t mean we’re going to be getting those options all the way to December or January. If we do get to that decline, we could get out of these quite a bit sooner. James: Exactly, Michael. A lot of our clients, and some of the people following us today, are very familiar with what we call the early buy-back. Generally speaking, if you are writing options in a portfolio, of course, if you have a portfolio with us you’re familiar with this, if you’re selling options for $700-$800 per contract and you see them trading 6 months later at $70-$80 per contract, that’s a perfect candidate for an early buy-back. We will very unlikely hold these options until they mature this December and January. Of course, they mature or expire, should I say, a month before they’re named. Odds probably in October or November, a lot of the options that we’re selling now will probably be worth 10% of their initial price-- very good candidates for early buy-backs. A lot of investors who sell options in their portfolio, they are talking about selling 60-90 day options. We feel that the sweet spot for selling options if further out than that. The small movements that happen in the market, technical buying, technical selling, if you sell too short period of time, these small moves can knock you out of your position. We don’t want a headline to knock us out of our position, and that’s why we sell further out in time and price. If the sweet spot for selling options was a tighter amount of days, like 30 or 60 days, that’s what we would do. We feel that the opportunities for very high probability option selling is further out in time. We’re paid to wait and that’s what we do. Patience is the name of the game. When you’re selling based on fundamentals, it gives you the patience to stay into a market. When you’re selling an option simply because, “Well, the decay is supposed to be the quickest between 60 and 90 days” and the market goes against you, you don’t know why you’re in that position and that makes it very difficult to have patience and the wherewithal to stay with a market. If you’re selling options based on fundamentals like this position would be, when the market goes against you a little bit, it allows you to hang onto the position. Quite often, they’re going to expire worthless. You need to be patient. As long as the fundamental is on your side, you don’t mind waiting. Michael: Okay. Let’s talk a little bit more about that buy-back. We were going to do this at the end, but since you got into it now let’s go ahead and talk about it now. It’s an important point a lot of people, when they’re first getting into selling options, especially commodity options, they’re thinking that same point you brought up—“Oh, I need to sell 30-60 days.” Obviously, we prefer to sell longer than that because, often times, you’ll get a primarily portion of that decay long before those options are every scheduled to expire. So, a question I often get is, “Well, how do you know when to buy it back? What level do you wait for before you buy it back?” That’s probably a good question for you to answer. What do you look for? James: Sure. Once an option has decayed 85-90%, the majority of that premium is pure risk. When you’re collecting $700, the option is trading at $70, you really need to do very little homework after that. You’ve collected 90% of the potential premium. Buying back an option with 90 or 100 days still remaining on it, we do this, as you know, quite often. If the option is trading at 60 or 70 and there’s 100 days left on it, that option’s going to sit at that price for a long time. At that point, you’re really not getting paid to keep that risk involved in your account by holding that position. 9 times out of 10 that option is going to go to zero. 9 times out of 10 it would have been an okay idea to hang onto it. When managing portfolios, the risk/reward is always what you base all of your ideas on. You’ve collected 90% of the premium, you no longer have to watch the weather, you don’t have to watch the supplies, you don’t have to look at the calendar, you just need to place the order and buy the option back. Michael: Yeah, that’s a good question. Before the show here today we actually had a client visit. One of the things he was asking was, he was looking at his account saying, “Boy, I see we have a lot of expirations scheduled for September, October, November. Will it be then I can expect to realize the profits on these options?” That was the exact point I was explaining to him- no, not necessarily. You could be taking profits on these things in June, July, August if everything is going well. That was a point, especially if you’re new to commodities option selling or option selling in general, it’s a big point to realize- we’re not always holding these things to expiration. In fact, most of the time, you probably can buy them back early and cut that risk and put that capital into a different investment. If you’d like to learn more about the early buy-backs and looking at the fundamentals in some of these markets, the best resource we can recommend is our book, The Complete Guide to Option Selling: Third Edition. You can get it on our website at a little bit less than you’re going to pay at a bookstore or on Amazon. The link is www.optionsellers.com/book if you’d like to get your copy there. James, let’s move into our second market for this month. One of your all-time favorite markets: the coffee market. Right now, we’re at a key point in time where we’re right ahead of the Brazilian harvest. That can bring a very interesting seasonal into play, one that option sellers can use to their advantage. James, you want to give the overall synopsis of that market right now? James: Certainly, Michael. In 2016, parts of Brazilian’s coffee belt did experience extremely dry conditions and here’s where you need to do your homework just a little bit. Brazil is basically just a ginormous farm, whether it’s cocoa or soybeans or coffee or sugar, basically that’s what the Brazilian nation is made of. The coffee belt is enormous. In 2016, there were dry conditions in a lot of the coffee growing regions. It was primarily in the Robusta region of Brazil. We trade primarily Arabica coffee. The Arabica crop was doing extremely well last year, but all you heard about was the driest conditions in 15 years in Brazil. It primarily was hurting the Robusta crop. The Arabica crop did receive plenty of rain. That volatility and that news headlines that coffee was getting last year pumped up, especially coffee calls, giving it historic volatility that will now create extremely expensive coffee options this year, next year, and probably 3-4 years out. Believe it or not, it does hang on that long. This year, 2017-2018 crop, is the off-cycle year; however, Brazil is expected to produce nearly 50 million bags of coffee this year. Next year, the on-cycle for production would be approximately 60 million bags. This type of production doesn’t mean that coffee will never rise in price. Sometimes it will fall and sometimes it will go up. This prevents the really large move in a certain direction. When you’re able to make coffee beans to that extent, to kind of give you a focus idea, not that long ago Columbia was the largest producer of coffee, producing 10 or 20 million bags of coffee. Everyone counted on Columbian beans to supply the world. Brazil is now making 50 and 60 million bags of coffee. This year’s expected to be an off-cycle crop record year. Next year will likely be a record production year in Brazilian coffee. That is production that we see coming down the pike. How are supplies now? In the United States, it was just broadcast this past Monday that coffee supplies in the United States are at the largest level since they’ve been counting coffee beans starting in 2002. So, supplies here in the United States are at all-time highs. Production in the next 2-3 years is expected to be a record. Seasonality for coffee, as it normally rallies in April or May, the Brazilian starts in earnest in June, July, and August, these coffee beans then are looking for a home. That’s when prices tend to fall. Coffee recently has rallied up to 140-145 level. Selling coffee calls for late this year, beginning of next year, is just a sweet spot and an ideal candidate for option selling going forward for this year. The natural gas looks like a very good opportunity. Coffee is just a great way to diversify your account. We really love the aspects for coffee to be having probably an overabundance supply over the next year or two. We’ll be looking at selling coffee calls this year and next. Generally, you sell them in March and April and the market starts to fall as Brazilian products come in June and July. This year looks like it’s a good setup, as well. Michael: James, we’ve already had a pretty good downward move in coffee and I know you’ve been selling these most of the month. One thing I noticed is even with that downward move in prices, that volatility that we got from the drought you talked about back in the fall, that’s still in the market. So, you can see, even though you’ve had a downward move in prices, you can still sell coffee calls so much further above the market. That’s just the added value of that volatility that’s still working in there. James: The volatility is something, as we were discussing earlier, the VIX on Wall Street rallied some 24%. Volatility allows someone who maybe has missed a position or I missed a buy or I missed a sell on options, or basically anything else. On commodity options, that volatility allows the person who did get in on the low and the market’s rallying, you still have time to sell puts. A market that’s falling and you didn’t get in on the sell on gold calls or coffee calls or whatever it happened to be, that volatility allows you to not have to be in on the high or low day. The volatility still stays there and really gives the person the ability to take their fundamental analysis, put the position on even though you didn’t catch the low, you didn’t catch the high. The coffee market did weaken recently, just like we expected it to. We think that selling calls in coffee on subsequent rallies is still going to be a very good idea. Michael: So, the market’s over sold right now and we get a little bump, that might be an opportunity for some people that are watching this that might want to look to enter. That might be a good opportunity for doing that. James: We’ve been selling coffee calls with both hands here recently and it did just slide over the last week or so. The months of May usually has some up-turns in coffee, so we’re not expecting that coffee is going to be down and out for the rest of the year. We would expect some higher priced days in the coming month of May. We will be looking at that to add into our short position in coffee, yes. Michael: So, much like in the grain market, as the harvest begins supply start to rise and as supply rises that often contributes to an overall lower gravitational pull of prices. That’s what James is talking about taking advantage of here. If you would like to learn more about this trade and the coffee market, you can look at our blog post on coffee that was posted earlier this month. That is available on the blog. If you’re interested in learning more about the natural gas market, that is going to be the feature in our upcoming May Newsletter. You can certainly take a look at that. That should be in your mailbox and e-mail box somewhere on or around May 1st. Keep a look out for that. We also have a good feature in there this month on proper diversification and some of the best ways high-net-worth investors can use to diversify into alternative investments. Keep an eye out for that. James, I believe we’ve covered the topics we wanted to cover this month. For those of you who are interested in a potential managed portfolio with our firm, we do have no openings left available in May. We do have a handful still remaining for June, so if you’re interested in one of those remaining openings in June feel free to call the office this month. You can call Rosemary at 800-346-1949. She will schedule you a free consultation. Those will take place during the month of May for June openings, so if you’re interested in that please feel free to give her a call. James, any last words on the markets this month? James: Diversification really seems to be the word of the year right now. So many investors that seek our guidance and seek accounts with us, that is the word that everyone is using. No one is really quite sure what’s going to happen with the stock market or the economy, for that matter, and diversifying away from stocks is something, I think, a lot of investors are doing. We’re not sure if this economy is a 4% economy or a 1% economy. Lately, it’s going to be the latter, and it’s interesting to see how the stock market’s going to continue its ascent while that’s the case if the economy is slowing. Maybe demand for stocks and certain real estate and such might be waning. This is certainly a sweet spot for us and we certainly enjoy what a lot of investors are seeking right now. Michael: Well, it should be an interesting summer for stocks. Here in commodities, though, I think it’s business as usual and I think we’ll just keep doing what we are doing. Well, everybody, we’ve appreciated you watching this month and we will be back in 30 days. Have a great month of premium collection. We will talk to you in June.

The Frontside Podcast
066: 10 Pounds of Dirt in a 5 Pound Sack with Michael Coté

The Frontside Podcast

Play Episode Listen Later Apr 13, 2017 53:35


Michael Coté: @cote | cote.io | Pivotal | Software Defined Talk Show Notes: 00:54 - Pivotal 04:39 - Being a Professional Muller aka Analyst 11:08 - Iterative Development 32:54 - Getting a Job as a Professional Muller aka Analyst Resources: Pivotal Cloud Foundry GemFire Greenplum Pivotal Labs Wardley Maps Software Defined Talk Episode #79: From a vegan, clothing optional co-op to working with banks and oil companies - Coté's professional life, part 1 Software Defined Talk Episode #85: Being an analyst without being an asshole - Coté's professional life, part 2 RedMonk Transcript: CHARLES: Hello everybody and welcome to The Frontside Podcast, Episode #66. I am a developer, Charles Lowell at The Frontside and also host-in-training for 65 episodes. This is my 66th and I'm flying alone this week but we do have on the show with us a very special guest. Actually, the person who taught me how to podcast, I think it was about 10 years ago and he was like, "Charles, we should do this podcasting thing." I started my very first podcast with him and I still haven't figured it out. But his name is Michael Coté and he's a fantastic guy and welcome to the show, Coté. MICHAEL: Thanks for having me, Charles. It's great to be here. CHARLES: Now, what are you up to these days? You're over at Pivotal. MICHAEL: That's right. I work at Pivotal and probably people who are in the developing world know them for Spring. We have most of the Spring people. Then we also have this thing Pivotal Cloud Foundry. We're not supposed to call it a platform as a service but for matters of concision, it's a platform as a service that's the runtime that you run your stuff in. Then we also have a bunch of data products like GemFire and Greenplum and things like that. Then, 'openymously', if that's a word, we have Pivotal Labs. Now -- CHARLES: I think, it's eponymously. MICHAEL: Eponymously, yes. Now, you might remember Pivotal Labs as the people who use Chef Scripts to configure their desktops. Remember that? CHARLES: Yeah, I remember that. I was into that. MICHAEL: Yeah, in coincidental kind of way, the inspiration for the project Sputnik thing, which is coincidentally because now Dell Technologies owns Pivotal so all of that stuff has come for a full circle. I guess also since I'm intro-ing myself, I work on what we call the Advocate Team because we don't call them evangelists. No one likes to be called that I guess. I guess there's 12 of us now. We just hired this person, also in Austin actually McNorma who's big in the Go community and apparently can make images of gophers really well. I'm sure she does many other extraordinary things, not just the illustrator master. Everyone else basically like codes or uses the terminal but I do slides. CHARLES: Well, that's your weapon of choice, right? It's a more elegant weapon for civilized time or something like that. I'm going to look it up on Wikia. MICHAEL: Yeah, basically what we do on our team is we just talk about all the stuff Pivotal does and problems that we solve in the way people in an organizations like would think to care about our stuff. Most of what I do is I guess you call it the management consultant type of stuff. Since I have a background as an analyst and I used to work on corporate strategy and M&A at Dell so I have a vantage point in addition to having programmed a long time ago. If you're changing your organization over to be more agile or trying to devops, we would say cloud-native with a hyphen. How do you change your organization over what works and doesn't work? Most people in large organizations, they sort of pat you on your head. I'm sure you encounter this. That sounds really nice that we would be doing all of the good, correct ways of using computers but we're basically terrible and we could never make that happen here. Thanks for talking with us, we're going to go back and stew in our own juices of awfulness. You've got to pluck them out of that self-imposed cannibal pot there in the jungle and show them that they actually can improve and do things well. CHARLES: Would you say you feel like your job is being that person who shakes them away and can be like, "Good God! Get a grip on yourself!" MICHAEL: Sure. That's a very popular second or third slide in a presentation -- the FUD slide, the Fear of Uncertainty and Doubt slide where you're basically like, "Uber!" and then everyone just like soils their pants because they're afraid that are like Airbnb and Uber and [inaudible] and Google is going to come in and, as they say, disrupt their state industry. I try not to use the slides anymore because they're obnoxious. Also, most people in large organizations nowadays, they know all of that and they've already moved to putting on a new pair of pants stage of their strategizing. CHARLES: You've got the kind of the corporate wakeup call aspect of it but then it's also seems like a huge component of your job which is when you were at RedMonk, when you were at 451 and even to a lesser extent, it was Dell who was paid well to just kind of mull it over, like just kind of sit there and asynchronously process the tech industry, kind of like organizational yeast and let it ferment, kind of trying to see where the connections lie and then once you've made that presented, do you think that's fair? That's what sprung to mind when I heard you say like, "Yeah, we just kind of sit around and think about what is Pivotal and what does it do and what's it going," but like how do you get that job of like, "I'm just kind of a professional muller." MICHAEL: That's right. First of all, I think professional muller is accurate, as long as, I guess mulling is also for -- what's that thing you drink at Christmas that you put the little -- CHARLES: Mulled wine. Like low wine. MICHAEL: I can feel like that sometimes late at night. But having a job as an analyst, I was an industry analyst at two places for a total of about eight years or so. Then as you're saying doing strategy at a company, now what I do here, essentially a lot of what you do is very difficult. I know it sounds to people. You just read a lot of the Internet. You just consume a lot of the commentary and the ideas of things that are going out there and you try to understand it and then synthesize to use that cheesy word. Synthesize it into a new form that explains what it is and then finally, the consultant part comes in where you go and meet with people or you proactively think about what people might be asking and they say something like, "What does this mean for me? And how would I apply it to solve my problems?" I guess as an example of that -- I apologize for being a little commercial but these are just the ideas I have in my head -- Ford is a customer of ours and they also have invested in us which is kind of novel. We have GE and Ford invested in Pivotal and Microsoft and Dell Technologies as an interesting mix but anyways, they have this application called the Ford Pass Application. I drive a Ford Focus -- CHARLES: Like Subaru? But you do drive a Ford. MICHAEL: Yeah, because I don't care about cars. It's a bunch of nonsense. I see this app and basically the app, if you have a more advanced one, it might tell you your mileage and even like remotely start your car. But it doesn't really do that much. You have the app and it will tell you information about your car and where to park and it even has this thing where it links to another site to book a dealership thing, which is annoying. CHARLES: Why would you want to book a dealership? To buy another car? MICHAEL: Well because the Ford Focus I have is notorious for having transmission problems so you're like, "I got to go and take it into the dealer to get all this recall stuff taken care of," so wouldn't it be nice... I don't know if you've ever worked with a car dealer but it's not desirable. CHARLES: Yeah, it would be nice if they didn't charge $6000 for everything. MICHAEL: Right. It's a classic system of having a closed market, therefore that jacks up prices and lowers customer service usually. What's the fancy word if there is a negative correlation, if you were to chart it out? Like price is negatively correlated to your satisfaction with it. Kind of like the airline industry, not to bring up a contemporary topic. You pay a lot of money to fly and you're like, "This is one of the worst experiences I've had in my life," whereas you go to the dentist and get a root canal and you're like $20 co-pay. Loving it. [Laughter] MICHAEL: Anyhow, this Ford Pass application doesn't really do very much so what does that mean for what I was explaining. If you go look up and read about it, starting back in the late-90s, your extreme programming and then your Agile Software Development and your devops nowadays, one of the major principles is what you should do is ship often. Maybe you should even ship every week or every day. Don't worry about this gigantic stack of requirements that you have and whatever you should be shipping all the time and then we've trained ourselves to no longer say failing fast. That was a fun cheeky thing back in the late-2000s. CHARLES: Did we trained ourselves not to say that anymore? MICHAEL: I don't hear it very often. CHARLES: Man, I got to go scrub my brain. MICHAEL: Yeah, well this is why you consult with me every 10 years as I tell you the new things. CHARLES: Okay, here we go. We're going to have you on the podcast again. MICHAEL: That's right. You have this idea of like, "We should be releasing weekly," but then if you go to Ford, you're like, "What does that mean?" To shave the shaggy dog here, essentially the idea that they're shipping this mobile application that doesn't really do very much is an embodiment of the idea that they should be shipping more frequently. This may be a stupid example. It's not that it's not going to do very much like permanently but as I have witnessed, very frequently they add new features so Ford is in this cadence but there's this app that instead of working on an application for two years and having everything in it, they're actually releasing it on, I don't know if it's weekly but they're releasing it on a very frequent basis, which allows them to add features. What that gets you is all the advantages of a fast iteration cycle small batch thing where they can study this actually a good feature. They can do all your Lean Startup nonsense. That's a very like weird, perhaps example of how you explain to someone like a large car manufacturer like Ford, this is what devops means for you. Therefore, why you should spend a lot of money on Pivotal? Now that's the part that lets me pay my mortgage every month, the last bit there. CHARLES: Right so Pivotal builds apps. MICHAEL: Well, the Labs people build apps for you. CHARLES: I'm kidding Coté. MICHAEL: Yeah, they actually do. The Labs people are like a boutique of another boutique like ThoughtWorks is kind of a boutique but they're kind of a boutique-y version of ThoughtWorks. That probably is terrible as someone who markets for Pivotal to do that. Do you ever notice how political candidates never really name their opposition? Like you never really want to name your competition but anyways... CHARLES: Pivotal marketing are going to come crashing through your window. Everybody, if we hear them in the next five seconds -- well, I guess you can't call 911 because this is not live. MICHAEL: Yeah, that's true. The Labs people build stuff for you and then the part that I work, in the Pivotal Cloud Foundry people, they have the actual runtime environment, the cloud platform that you would run all that stuff. Plus all the Spring nonsense for your microservices and your Spring Boot. I understand people like that. CHARLES: So good for Ford, for actually being able to experience, either in the development and the joys and the benefits that come with it. But this is actually something that I actually want to talk about independently was as I kind of advance in my career, I find myself pushing back a little bit against that incredibly tight, iterative schedule. Shipping things is fantastic and it's great but I find so much of my job these days is just trying to think out and chart a course for where those iterations will carry you and there is a huge amount of upfront design and upfront thought that it is speculatory but it's very necessary. You need to speculate about what needs to happen. Then you kind of measure against what's actually happening but I feel that kind of upfront design, upfront thought, we had this moment we're like, "We don't need that anymore. Let's throw it all in the garbage." In favor of doing things in these incredibly tight loops and finding where's the clutch point, that kind of long range thinking and long range planning comes and meets with the iterative development. I have no idea. What's the best way for those to match up those long cycles and those short cycles? Where is the clutch play? MICHAEL: I'll give you two and a half, so to speak trains of thoughts on that. One of them is I think -- CHARLES: Two and half trains of thought, I like that. Can we get straight to the half train of thought? MICHAEL: Yeah, I'm going to start with the half, which is just taking all of your questions and putting periods at the end of them before I round up to answering the question. I think a lot of the lore and the learnings you get from the Agile world is basically from consultants and teams of consultants. Necessarily, they are not domain experts in what they're doing so their notion is that we're going to learn about what it is we're doing and we don't actually know we can't predict ahead of time because we're not domain experts so they almost have this attitude of like, "We'll just figure it out on the job." Let's say The Frontside gets hired to go work on a system that allows the Forest Service to figure out which trees to go chop down or not -- CHARLES: If you're the Forest Service, we are available to do that. MICHAEL: I'm guessing you don't have a lot of arborists who have 10 or 20 years of experience working there. CHARLES: No, we don't. MICHAEL: And so you have no idea about that domain so in doing an iterative thing, you won't be able to sit down and predict like everyone knows that when you send the lumberjacks out, they're going to need these five things so we're going to have to put that that feature on there. They need to be able to call in flapjacks when they run out. That's just what's going to happen so you don't know all of these things they need to do so you just can't sit down and cogitate about it ahead of time. Also this comes in from the Lean Startup where there's a small percentage of software that's actually done globally and the notion of a Lean Startup is that when you're doing a startup, you're never going to be determined what your exit is, how you cash out, whether that's building a successful long term company while you get sold to someone or whether you IPO, you're not going to able to predict what that business model is so you just need to start churning and not think a lot ahead of time. Now, the problem becomes, I think that if you are a domain expert, as you can do the inverse of all the jokes I was just making there, you actually can sit down and start to predict things. You're like, "We know we're going to need a flapjack service," so we can predict that out and start to design around that and you can do some upfront thinking. Now similarly, developers often overlook the huge amount of governance and planning that they do for their own tools, which I know you're more cognizant of being older or more experienced, as they like to say. But basically, there's a bunch of, as we used to call it when I did real work and develop stuff, iteration zero work like we're going to need to build a build system, we're going to need a version control. You actually do know all these things you're going to need so there are all the things you can plan out and that's analogous to whatever domain you're working in. Sometimes, at least for your toolchain, it is worth sitting down and planning out what you want. Now, to hold back the people who are going to crash in my window, one of the things you should consider is using Pivotal Cloud Foundry. That's probably something you should cogitate on ahead of time. CHARLES: I think they're going to crash through your window and give you a Martini, if the marketing ninjas are going to do that and if you mention them in a positive light. MICHAEL: You know, it's 10:52 Central but if we were in London, it would probably be an appropriate time so we'll just think about that. Now, on the other hand, you don't want to go too overboard on this pre-planning. I'll give you an example from a large health insurance company that I was talking with recently. They had this mobile app -- it's always a mobile app -- that had been languishing for 15 months and it really wasn't doing anything very interesting. It was just not working well and they could never release it. This is a classic example of like, "We took a long time to release a mobile app and then we never released it again and then it blows." It's not achieving all of the business goals that we wanted. Mostly, what a health insurance company -- I've talked with a lot of the health insurance companies -- want with their mobile app is at least two things and probably many more but these would be the top of the list. One, they want their customers, their users to look up what their health insurance is, figure out doctors they can go to, the basic functioning that you expect from your health insurance company. And two, they want to encourage their customers to do healthy behaviors because if you think about it as a health insurance company, health insurance in my mind is basically like this weird gamble of like, "I'm gambling on the fact that you are going to be healthy," because then I pay out less to you and you just give me money so the healthier that your users can be, the more profit you're going to make. That's why they're always trying to encourage you to be healthy and stuff like that. The mobile app was not achieving, at least these two, if not other business goals they have. They basically were rebooting the effort. The way they started off is they had -- I don't know how many inches thick it was -- a big, old stack of requirements and the first few iterations, the product team was working on it and talking with the business analyst about this and going over it and what they sort of, as we were calling Pivotal Labs the product owner but the person who runs the team, realize is like -- to cut a long story short -- "This is kind of a waste of time. We shouldn't just prioritize these 300 features and put them in some back road and execute on them because these are the same features that we based the more abundant application on, we should probably just start releasing up the application," kind of like the FordPass app. That said, they did have a bunch of domain experience so they had a notion of basically what this app was going to do and they could start planning it out but they figured out a good balance of not paying attention to, as Martin Fowler used to call it the almighty thud, of all the requirements. What they ended up doing is they basically -- CHARLES: What's the almighty thud? MICHAEL: You know, he's got some bleaky or whatever. It's basically like we started a project and I think it's from 2004 and someone FedExed me about 600 pages of an MRD or whatever and I put it down on my table and it made a loud noise so he calls that the 'almighty thud', when you get this gigantic upfront requirement thing. What happened in this health insurance thing is they stopped listening and talking with those people and they kind of like chaff them out, not like when your rub your legs together but they kind of distracted them to that fact but eventually, they just got them out of the cycle and they started working on the app. Then lo and behold, they shipped it and things are working out better now. CHARLES: Hearing what you're saying and kind of thinking it over, I think if you're going to have an almighty thud, what you really want is you want all that upfront research and all that upfront requirements gathering or whatever, not necessarily to take the form of a set of features or some backlog of 300 things that the app 'needs' to do or 'should' do but just a catalogue of the problems, like a roadmap of the problems. MICHAEL: Exactly. CHARLES: You know, that actually is very valuable. If it's like, "These are things that are true about our users and these are the obstacles that they face. If we do choose that we want to go from Point A to Point B, where we are at Point A, then we actually have a map of what are the things that are sitting in front of that and what are the risks involved." It's like if you got -- you played, you're from my generation, you play the Oregon Trail, right? MICHAEL: Yeah. "You have dysentery." CHARLES: Right. I don't know where I'm going with this analogy but my point is developing that app is like going from Kansas City to Portland. But the thing about software is you don't necessarily have your corn meal. You don't need to say like, "We're going to need six pounds of cornmeal and we're going to need these wagons and we're going to need these mules," because this is software and you can just code a mule if you need it. But you might not need a mule, if the rivers are not in flood... I don't know. Like I said, I don't know where I'm going with this analogy. But do you see what I'm saying? The point I'm trying to make is that having the map of the Rockies and where the passes are is going to help you. MICHAEL: Yeah, this is probably where I'm supposed to expertly rattle off what Wardley maps are and how they help, which is fine. I think that's a great tool. There's this guy Simon Wardley and he's actually a great contemporary philosophizer on IT-led strategy. I think he works for CSC who no longer owns mercenaries but they used to -- Computer Science Corporations. I think they own a little bit of HP Services Division but he works for some think tank associated with CSC and he has got a couple of OSCON talks on it, where it's called a Wardley map and it's a way that you start figuring out what you're saying, which is to say your company's strategy. Using your front metaphor of the era of tall hats, if you remember that other movie, if you're on the Oregon Trail, broadly your strategy is -- and people get all up in your face about the difference between a plan and a strategy and we'll just put mute on them and edit them out of the audio because they're very annoying -- CHARLES: We'll call it an approach. MICHAEL: That's right. Your plan or your strategy -- and pardon me if I use these phrase free and loosely and everything -- is you would like to get to Oregon and you would like to live there and maybe grow apples or start a mustache wax company or some donuts, whatever it is you do out there once you get to Oregon and their strategy is -- what are the assets that I have. I have a family, I have some money and I also know some people who are going there so I'm going to buy a stagecoach and a mule, then I'm going to kind of wangle it out and we're going to go over there. Also, part of our strategy is we're going to go through the northern pass because we're used to winter versus the southern pass, which isn't the Oregon Trail because reasons. Maybe Texas isn't part of The Union yet so I don't want to deal with the transition between whatever that weird Texas thing down there -- CHARLES: The desert, there's the southwest and the desert. MICHAEL: I don't have the capabilities to survive in a desert so I need to go to the north and hopefully I won't be like that movie and have a grizzly bear rip up my backside and everything. You sort of put together this plan. Now going back to what you would do in IT world is to your point, someone does need to define what we would call the business value or the strategy, like what you want to do. Looking at the Ford thing, what Ford wants to do is they do cogitating thing ahead of time and they're like, "We manufacture cars," and you've got electric cars and Uber. That's where the scarce light comes in. In the future, who knows that people will still buy cars? It might be like that I-Robot movie where all the cars are automated and you just go into one. As a company, whose responsibility is to be as immortal as possible, we need to start making plans about how we can survive if individuals no longer buy cars. Let's do that. This is a huge upfront notion that you would have and then that does trickle down into things like my Ford thing -- I'm kind of speaking on their behalf -- if we have a direct connection with people, maybe eventually we introduce an Uber-like service. You can just check-out a Ford car. Then maybe this and maybe that. It's the strategy of how do we set ourselves up to do that. Now, I think the Agile people, what they would go for is it's really good to have that upfront strategy and you'll notice that in a lot of lean manufacturing in Agile talk, no one ever talks about this stuff, much to my extreme annoyance. They don't ever talk about who defines the strategy and who defines that you're working on this project. That's sort of left as an exercise to the reader. The Agile people would say like, "The implementation details of that are best left to the development team in an Agile model." Just like the developers are always arrogantly are like, "Hey, product manager. How about you f-off about how I should implement this? I am the expert here and let me decide how I'm going to implement the feature that you want for me." It's kind of like that rushing dolling down of things. To the development team, you worked on some, what was it? Band frame wire thing, a long time ago? It was basically like, "We don't know it. Maybe this is not the case. Let's pretend like it was." We don't know exactly how you're going to implement this stuff but our goal is that there's bands and they need sides and ways of interacting with their users so let's just figure out what that looks like but they had that upfront idea of ways that they were doing things. CHARLES: Let's start walking. MICHAEL: To add on some more. There's another edge case that you're making me think of, which is a good way of thinking through almighty thuds versus how much planning you have and that's government work. Government work that's done by contractors and especially, military contracting work. What you notice in government work is they have, seemingly way too much paperwork and process. They literally will have project managers for project managers and the project managers have to update how the project is going and they reports. If they don't do the reports correctly, their contract is penalize and you might even get fired for doing it. If anyone stops and says while the software is working, they were like, "No, no, no. don't be naive. It doesn't matter if the software is working or not, if we don't fill up the project report, we're fired." Until someone like yourself or me, it's just like your head explodes and you're like, "But working software, not a concern." In that case, it actually is part of the feature set, part of the deliverable is this nauseating amount of project reporting and upfront requirements, which has this trickle-down effect of annoyance but that's what you're getting paid for so that's what you do and if you want to make yourself feel better about it. I don't know how it is in the rest of the world but in the US, basically we think the only person worse than maybe, Lucifer is the government. I don't know why this comes about. We enjoy the fruits of the government all the time but for some reason, we just think they're awful. Whenever we give money over the government, we want to make sure that they're spending it well and if they're not corrupt and they don't hire their entire family to help them run the government and make sure that they're making extra money globally in their businesses, I wouldn't know anything about that. But essentially, you want to make sure there's no corruption so transparency is almost more important than working software. The way you achieve that transparency is with all this crazy documentation. CHARLES: Here's the thing. I agree the transparency is fantastic but nothing is more transparent than working software. Nothing is more transparent than monitored software. Nothing is more transparent than software whose, by its very nature is radiating information about itself. You can fudge a report but you can't fudge a million happy users. MICHAEL: Don't get me wrong. I'm not saying that the way that things currently operate is the ideal state. I'm saying that that desire for transparency has to be addressed and for example, using your example, let's say you were delivering working software but you were also skimming 20% off the top into some Swiss bank account -- you're basically embezzling -- and then it turns out that you need 500 developers but you only actually had 30 developers. There was corruption. The means even though the ends, even though the outcome was awesome, the means was corrupt so that's the thing in a lot of government work that you want to protect against. I just bring that up as an edge case so a principle to draw from that, when it comes to almighty thudding is like sometimes, that is part of the deliverable. We would aspire in our fail, fast, Agile world to not have a bunch of gratuitous documentation as part of the deliverable because it seems like a waste. It would be like every morning when you battle with your kids to get their shoes on, you had to write a two-page report about how you're getting ready to go to school stuff with your kids was going. As a parent you would be like, "I don't need that." However, maybe if you were like an abusive parent and it was required for you to fill out a daily status report for you to retain the parentship of your kids, maybe it would be worth of your time to fill out your daily status report. That was an awfully depressing example there. CHARLES: Let's go back to the Oregon Trail. What I'm hearing is that -- and we will take it back to the Oregon Trail -- you also need to consider, as were saying, you have some sort of strategy which is we want to go sell apples and moustache wax. But what we're going to do is we're just going to start walking, even though we don't have a map. But obviously, if you send out scouting missions, like you know where you're going, you know the West Coast is out there somewhere, you start walking but the stakes determine how much of your resources you spend on scouting and map drawing -- MICHAEL: Yeah. My way of thinking about strategy and again, people strategy is this overloaded word. But my way of thinking about strategy is you establish a goal: I would like to go to the West Coast. Now, how you figure that out could be a strategy on its own, like how did you figure out you want to go to the West Coast. But somehow, you've got to get to a prime mover. Maybe those tall hat people keep beating me up so I want to go to the West Coast. I want to go the West Coast is the prime mover. There's nothing before that. Then you've got to deal in a series of constraints. What capabilities do I have, which is another way of saying, what do I not have? And what's my current situation and context? On the Oregon Trail thing, you might be like, "I have a family of seven. I can't just get a horse and go buy a pack of cigarettes and never show up again." I guess I could do that. That's probably popular but I, as an individual have to take this family of six other people. Do I have the capabilities to do that? How could I get the cash for it? Because I need to defend against all the madness out there, I'm going to need to find some people to meet with. You're thinking and scenario planning out all of this stuff and this gets to your point of like, "If you're going to Oregon, it probably is a good idea to plan things out." You don't want to just like the next day, just figure it out. [inaudible] tell a joke. It's like, "Why do they sell luggage at the airport? Is anyone is just like, 'Screw it. Pack a clothes and we'll sort it out at the airport.'" It's an odd thing to sell at the airport. But you do some planning and you figure out ahead of time. Now, to continue the sort of pedantry of this metaphor, the other characteristic of going to the Oregon Trail, unless you're the first 10 people to do it is hundreds, if not thousands of people have done it already so you kind of know what it's going to be like. It's the equivalent, in a piece of software, if they were like, "This application is written in COBOL. I want you to now write it in --" I don't know, what are the kids do nowadays? Something.io? I-want-you-to-write-this-in-a-hot-new-language.io and basically just duplicate it. You're going to still have to discover how to do things and solve problems but if the job is just one-to-one duplicate something, then you can do a lot more upfront planning for it. CHARLES: While you're doing it, making the Uber and Airbnb. MICHAEL: Yes. CHARLES: Then you're done. MICHAEL: I think that's the truth and I want to put it another way. We used to be down here in Texas, the way we run government here is just lovely but we used to have this notion of a zero-budget, which is basically like, "Assume I'm going to give you nothing and justify every penny that I'm going to give you." I think that's a good way to think about defaults. I mean, about requirements is default is you don't need any and only get as many requirements as you need. If you're building tanks or going to the Oregon Trail, you might need a lot of requirements upfront that are actually helpful. CHARLES: But like a suit, you're just going to just strike out naked walking with. MICHAEL: That's probably a bad idea unless you -- CHARLES: Yeah, that is a bad idea but that's the bar but what happened if I were to do that? I might make it for 20 miles. MICHAEL: And build up from there and then have all the requirements that you need. I'm sure when Lewis and Clark went they were like, "We're going to need a quill and some paper and maybe a canoe and probably some guns and then let's see what happens." But that was a whole different situation than going to establish Portland. CHARLES: That was an ultimate Agile move. That was a pretty Agile project. They needed boats, they built them but they didn't leave St Louis carrying boats. MICHAEL: Right and they also didn't have a family of six that they needed to support and all this kind of stuff, right? CHARLES: Uhm-mm. MICHAEL: There was a question you asked a long time ago, not to steal the emceeing for you -- CHARLES: I would say, we need to get onto our topic -- MICHAEL: Oh, yeah. Well, maybe this is a good saying, what you're asking is, "How do you get this job?" and I don't think we ever addressed that. CHARLES: Yeah, that's a great question. You said you had to consume a lot of stuff on the internet. MICHAEL: Right. That's definitely how I do the job but I think how I get the job, there's an extended two-part interview with me on my Software Defined Talk Podcast Episode, available at SoftwareDefinedTalk.com, where I talk about my history of becoming an analyst and things like that but the way it happened is I don't have any visible hobbies, as you know Charles except reading the stuff in the Techworld. I would read about what's happening in the Techworld and would blog about it back in 2004, 2005 and I was discovered as it were by the people at RedMonk. I remember for some reason, I wrote some lengthy opinion piece about a release of Lotus Notes. I don't know why but that was a good example. This is back when all of the programming job were going to be off shored and I thought it was imminent that I was going to lose my job. I was looking for a job and I shifted over to being an analyst. That like the way that you get into this kind of business is you establish, there's two ways -- CHARLES: You established expertise, right? MICHAEL: Yeah, which is like always an unhelpful answer because it's sort of like, I was joking about this in another podcast, it's like Seth Godin's advice about doing good marketing, which is the way you do good marketing is you have an excellent product. If you have an excellent product that everyone wants to buy, then your marketing will take care of itself. I think if I'm asking how to market, I'm trying to figure out how to market a bad product. That's really what people want. CHARLES: That's also just not true. That's just like flat ass not true. That's a lie. MICHAEL: I mean, people who want to know how to diet better are not already healthy and dieting successful. You can't start with the base assumption of things are going well. CHARLES: Well, it is true. I like to think that we have an excellent product. We sell an excellent product but the thing is you can just sit on your excellent product all day and you have to tell people about it. If you want them to come sample it and try, maybe eventually buy it like the advice that you just need an excellent product. I'm amazed at anyone who can actually can say that with a straight face. MICHAEL: Well, he only writes like 150-word blogpost. I think his point is that you should aspire to have a unique situation and then marketing is easier. Similar with everyone's favorite example like an Apple or like a Pivotal or a ThoughtWorks. We eat all three of us and yourself as well, once someone gives you the benefit of the doubt of listening, you can explain why what you have is not available anywhere else. CHARLES: What it boils down to is if you want to easily differentiate, allow people to differentiate your products from others, then be different. That's fair. I'll give -- MICHAEL: To summarize it, it begets more of the tactics of how one gets a job like I do. What's the name of the short guy in Game of Thrones? 'Tyrian'? 'Tyran'? 'Tyron'? CHARLES: Tyrion. MICHAEL: At one point, Tyrion is like, "I do two things. I know things and I drink," so that's how you get into this type of business as you establish yourself as an expert and you know things. Now, the third thing which I guess Tyrion was not always required to do is you have to be able to communicate in pretty much all forms. You need to be good at written communication, at verbal communication, at PowerPoint communication, whatever all the mediums are. Just knowing something is not very useful. You also have to tell people these things. CHARLES: I think Tyrion is pretty good at that. MICHAEL: Yeah, that's true but he doesn't ever write anything. There is no Twitter or things like that. CHARLES: I feel like [inaudible] been a pretty big deal in the blogosphere. MICHAEL: Sure, no doubt. The metaphor kind of breaks down because the lattice for the continuing counterarguments do not exist in the Game of Thrones universe but whatever. CHARLES: They've got the ravens. That's like Twitter and it's bird. MICHAEL: That is true. Knowing how to deploy a raven at the right time, with the right message is valuable. CHARLES: We buffer up our ravens so that they fly right at eleven o'clock. MICHAEL: That's true. I could be convinced otherwise. CHARLES: That's why they arrived both at 6PM in the Westeros -- MICHAEL: I guess true to the metaphor of a tweet, most of the communications in Game of Thrones is either, what are they called? Little Birds? That the [inaudible] always has and then the Big Birds. You've got to tweets and the blogs. CHARLES: This is like it's nothing but Twitter. MICHAEL: Exactly. You got to really communicate across mediums. Now that the other thing that's helpful and you don't necessarily have to do this but this is what I think gets you into the larger margin. The more profitable parts of the work that I do is you have to be able to consult with people and give them advice and consulting is largely about, first figuring out the right opportunity to tell them how they can improve, which usually is it's good if they ask you first. I don't know about you but I've found that if you just pro-offer advice, especially with your spouse, you're basically told that you're a jerk. CHARLES: Well, it'd be like a personal trainer and walking around me like, "Hey man. Your muscle tone is kind of flabby. You got to really work on that." MICHAEL: The line between a good consultant and being overly-explain-y is difficult to discern but it's something that you have to master. Now, the other way you consult with people is you study them and understand what their problems are and you're sympathetic to them and I guess you can be like a British nanny and just scold them. That's a certain subset of consulting. CHARLES: Don Rickles of consulting? MICHAEL: That's right. You just help them understand how all of this knowledge that you have applies to them and hope solve their problems like the FordPass thing. When I went from being a developer to an analyst, it was a big risk to take on. I think I probably took like a $30,000 pay cut and I went from a big company health insurance to being on a $10.99 and buying your own health insurance which a whole other conversation. We talked about that every now and then but like it's a risky affair. It's not a promotion or even a lateral move. It's just an entirely different career that you go into. Then you talk with people a lot. As an analyst, you're constantly having to sort out the biases that you have with vendors who want to pay you to save things versus end-users who want to hear the truth. You can't really see a lot of Gartner and Forrester work but the work that you can see publicly from people like RedMonk, it's pretty straightforward. CHARLES: Yeah it is and whatever they did, a piece that was for one of their clients, there was always a big fat disclaimer. MICHAEL: Now, the other thing I would say is what I've noticed -- not to be all navel-gazing -- about myself and other people who are successful at whatever it is I do is there's two things. One, they constantly are putting themselves out there. I remember and this is probably still the case. This is probably all in Medium. There's probably a Medium post every quarter that's like, "If you're a developer, how do you give more talks. What your first conference talk?" Basically, the chief advice in there, other than bring business cards and rehearse is essentially like you just got to get over that idea of self-promotion. You basically have to self-promote yourself incessantly and do all those things that you find nauseous and be like, "Me, me, me," which is true. You've got to get over that thing. If you're like me and you're an introvert who actually doesn't really like that many people, except a handful of people like yourself that I'm friends or family with, you have to put on the mask of an extrovert and go out there and do all this extrovert stuff or you'll fail. I shouldn't say you'll fail, you won't increase your overall comp and margin and everything. You'll basically bottom out at about $120,000 a year or so because that's about as much as anyone will pay for someone who just write stuff but doesn't actually engage in the world and consult. You've got to do that. Then the other consequence of that is you always have to be trying out new types of content and mediums like here we are in a podcast. Long ago, you and I, in 2005 or 2004 -- CHARLES: You got me to sign up for Twitter. MICHAEL: Yeah, like we started off a podcast because I remember hearing the IT conversation stuff and John [inaudible], who is a big inspiration for me, a role model, I remember he was just trying out podcast and I was like, "All right. I'll try that out. That looks like fun," and then here we are. CHARLES: I remember you tried out the podcast and you're like, "Let's go into your backyard or my backyard. Let's talk about software for 15 minutes." I remember that very clearly and that was 12 years ago. Then I remember also like with Twitter, you're like, "Now, you should sign up for this Twitter thing," and I remember I did and that's when it was still coming through SMS on your phone and like "I'm walking around Teatown Lake. I'm going to get tea." And I was like, "Oh, my God. This is so fucking stupid." But little did I know, you were actually signed me up to a service that changed my life. MICHAEL: Yeah, it was the stage direction era of Web 2.0 where you're just supposed to give people your status updates, instead of your searing insights. But yeah, you've tried it all these different mediums because again it goes back to your job is to communicate. You need to tell people things that you know. CHARLES: Coté, what is your strategy on virtual reality? MICHAEL: My strategy in virtual reality. Well, you've caught me, Charles because I'm not into that. You remember when Time Magazine had that Chinese lady who was like a... Not Frontside. What was the name of the big virtual reality thing that was big...? CHARLES: Second Life. MICHAEL: Second Life, who is a Second Life millionaire. CHARLES: Yeah, she had armies of people. She was mining some resource in Second Life and then reselling it and she made a lot of money. MICHAEL: I don't really like visual mediums so as Marshall McLuhan would say 'hot mediums'. I guess I like the cool mediums. That's not my thing. That's where my principle fails. Maybe I'll do that one day. CHARLES: This is pretty hot. This medium is pretty like -- MICHAEL: I think maybe audio broadcast is hot. I'm just pretending like I know. This is another trick that you can deploy that my wife has picked on is most of the time, 78% of the time, I actually have no idea what I'm talking about. I just know words. I don't actually know Marshall McLuhan theory. I read that one book a long time ago and I remember that scene in Annie Hall where he gives a little diatribe to whatever the Woody Allen character is. That's the extent of my Marshall McLuhan knowledge. CHARLES: Was Marshall McLuhan actually in Annie Hall? MICHAEL: He was. CHARLES: Don't sell yourself short, Coté. MICHAEL: Sure. CHARLES: You know things and you drink so let's talk about that second aspect because I know that you like me whole tearing up as a role model. MICHAEL: I should say since we're both happily married, except for the third thing that he does which he -- CHARLES: Oh, right. MICHAEL: Another unmentionable word. He too freely hangs out with the ladies. CHARLES: Right, anyway aside from that, throughout doing all this stuff, you keep a very, very chill perspective on things. I feel like the tech world gets so wound up around itself and it gets so tight and so stressed about its own problems. There's constantly wars in JavaScript and before we were in the JavaScript world, we were warring in Ruby. I remember when Twitter went over to using Scala instead of Ruby. Oh, my goodness, it was terrible times. I feel like there's a lot of stress and yes, you want to take it seriously but I feel like you've always been able to maintain an even-keeled perspective about technology which actually allows you to commentate on it effectively and intelligently because you're able to unwind yourself from the squabbles of the day and see maybe a bigger picture or something like that. MICHAEL: That's nice of you to characterize me to use a -- is that a hanging, dangling participle there, when you're in [inaudible]? CHARLES: Yeah, I don't know. MICHAEL: I think that's also just a function of being old. CHARLES: So are you actually not stressed or is it just part of your persona of being an extrovert or something like that? MICHAEL: About the tech world? No, I'm not stressed about that. As you kind of outlined, especially I was not sent the demographics for the show, which is fine. I'll overlook that but I'm guessing that that was a joke. CHARLES: Who got some designers, developers -- MICHAEL: I'm guessing there's a lot of people who actually are on the frontlines of working on software. I think this happens also in the white collar set. But essentially, it's really easy to slip into over allegiance to something and I don't know what rhetorical fallacy this is but it's the bias of over allegiance to something, you get all wrapped up in defending a tool over something and the virtue of it, whether it's Emacs and vi. I'm sure reactive people, whatever that is, have all sorts of debates. The thing is when you're heads down on this stuff, you don't realize how petty all those discussions are. It's not so much that it's a waste of your time but it's just one battle in an overall war that you have. It's good to have opinions and figure things out but you should just relax about it because the more angry and emotional you get, you're going to make a lot of mistakes and decision and problems. I wish I had an example of this but this is one of those things that intuitively as you ages as developer, it's not like your literal age. It's just the amount of time you've been developing software. You could be a 25-year old who's been developing software for 10 years and you would probably get this notion but you just realize that stuff changes and you just learn the new things. It's kind of not a big deal like one day, you're going on and on about how vi is great and the next day you're using that Atom editor and then whatever and you just use the tool that's appropriate and it's annoying when you're younger and people are applying Hacker News with like, "You should use the tool that is appropriate," which is a stupid reply. That's just kind of how it is. Also the other thing, in the more white collar world, as an analyst, especially doing strategy for a company, you can't be biased by things because then you'll make poor decisions as an analyst. Also when you're doing strategy in M&A that result in bad business outcomes so you actually be very unbiased about things. CHARLES: I think it applies in everything. If you get too emotionally invested in one particular approach in software, literally in anything you do, it does result in bad outcomes. The problem is you may not actually realize the consequences of those bad outcomes far down the road from the poor decision that you made that caused you that outcome so you might not necessarily connect it back. MICHAEL: Yeah, and I keep bringing this up but I think another effect of being calmer in your nerd life is having something that you do outside of your programming life, which is either having a family or having hobbies or something like that but you know -- CHARLES: Or having a wild turkey. MICHAEL: Yeah but you've got to have something, a reason to stop thinking about your tech stuff or it'll consume you. I suspect when you see the older graybeards who go on and on about open source and they're very like... I don't know. What's the word? They're very over the top and fervent about tech stuff. It's probably because like me, that's their only hobby and they haven't figured out how to how to control it. It becomes part of their identity and it defines them and then they're down this twisty, turny path of annoyance to the rest of us. CHARLES: Again, don't sell yourself short, Coté. You've got plenty: you love the cooking and eating and the drinking so close this. Do you have a favorite drink that you've been mixing lately? MICHAEL: No. CHARLES: Or any kind of favorite food because every time I go over to your house, even if we're having pizza, there's always a nice hors d'oeuvre or something to drink, something to tweak that appetite for something special. I kind of wondering if there's anything that you're into. MICHAEL: I have some very basics. One, I don't know if I drink a lot or drink a little. I think the science on this is very confusing, kind of like drinking coffee. I try to drink less. I basically go back to the basics of I want cheap wine that's not terrible. That's what I'm always trying to discover. I think I've also started to rediscover just straight vodka. That's pretty good. I think that fits into the grand scheme. CHARLES: I just can't do it. I can't follow you there. I need some, what do they call them? Gin florals? I can drink gin -- MICHAEL: Oh yeah, that's good too. CHARLES: That's about as close as I can get to straight vodka. MICHAEL: And then food-wise, I just wrapped up finally figuring out how to cook fish and chicken without it tasting terrible. CHARLES: Oh! What's the secret? MICHAEL: No, I want to put a disclaimer out. There's a EULA on this. I'm not responsible for anything bad that happens but what you want to do is cook at about 10 degrees less than you're supposed to. A chicken is supposed to be 165 degrees but you take it out of the pot when it's like 150 or 155 on another part of the pan. Fish is supposed to be 145 degrees but you take it off when it's about 130 or 135. It cooks a little bit more but these guidelines to cook your meat to that thing, it ruins it. Also you can brine a chicken and things like that. Also, what you want to get is an instant meat thermometer. One of those that you can just poke in your meat so you're always checking the temperature. That's what I've been working on. CHARLES: I have a theory about that. I will laid out really quickly, maybe it's just because the juices. It's the juice that so yummy there so you want those to be locked in and boiling but not boiled away. I'm going to give that a try on my -- MICHAEL: And fish is particularly tricky. CHARLES: Because all it takes is five minutes. Sometimes, it's two minutes and 30 seconds too long and you ruin the fish. MICHAEL: Then the next theory I want to try out is that you can actually fry fish in pure butter but you've got to paper towel it off afterwards because too much butter ruins it. But I think if your paper tower it off like you do grease off of bacon, then I think that's how you achieve -- not as good as a restaurant because in a restaurant, they have those butane torches and the crisp it up on the outside or reverse sear or whatever -- CHARLES: Is that what they do? Do they just run their torch right over the fish? MICHAEL: That's all I can figure. They might also be professional cooks who know how to cook things. CHARLES: They might have done it a lot of times. They might have had someone like Gordon Ramsay yelling at them constantly. "I can't believe this fish is so terrible. Waah!" All right. I'm going to give the fish a try. I'm going to give the chicken a try and I'm going to give everything that you just spent the last hour talking about, also a try. MICHAEL: Well, thanks for having me on. It's always fun to have a show with you. I just posted yesterday our second revival of the Drunken Retired Podcast, which is over at Cote.show. It's just '.show'. URLs are crazy nowadays. I guess the only self-promotional thing I have is I'm over in Twitter @Cote. It'd be nice if everyone should just go follow me there because I'm always very sad that I don't have enough followers and they'll never verify me. I don't understand what the problem is. I'm clearly me. Then I mentioned earlier, the main podcast that I do is Software Defined Talk, which is at SoftwareDefinedTalk.com and you should come spend a lot of money on Pivotal stuff. I'm happy to tell you all about that. Just go check out Pivotal at Pivotal.io CHARLES: I guess that is about it. We will talk to everybody later. Thank you for staying tuned and listening to this supersized episode. Come check us out sometime!

OptionSellers.com
April Opportunities Crude Oil, Cotton Market for Option Sellers

OptionSellers.com

Play Episode Listen Later Mar 31, 2017 26:48


Michael: Hello everyone. Welcome to the April edition of the OptionSellers.com Podcast. This podcast will be both video and audio podcast. This is our first video podcast. James, welcome to the podcast. James: Thank you, Michael. Very excited about doing both video and audio – get our mugs out there! Michael: I think first on the agenda this month is what we have going on in the stock market right now. Is this going to be the long awaited correction everybody’s been awaiting or is this just a little blip? What do you think? James: It’s interesting, Michael, the stock market has just been on a historic tear here ever since the election – and with good reason. If we have deregulation and we have a lot of pro-business ideas coming out of Washington along with a U.S. economy that’s doing fairly well right now, a lot of investors have been pouring into the stock market. We had the first shot across the bow, of course, with the healthcare issue being quite a bit of a swing and a miss for Mr. Trump this past week. A lot of investors right now are thinking, “Well, if we can’t get that passed maybe the deregulation and lower taxes and interest rate help may not be as much of a slam dunk as a lot of investors thought.” This could finally be the catalyst for the long-awaited 5-10% correction in the stock market. Everyone was absolutely factoring in the best-case scenario. Now, Washington D.C. quite isn’t as put together as people thought. The whole idea of a strong U.S. economy along with a very business-friendly administration, some of that’s being taken off the table right now. I wouldn’t be surprised that a lot of investors do take some chips off the table. Some of the largest investors in the world right now have thought about that and Goldman Sachs and large banks like that are talking about making their position smaller. That tells me maybe the long awaited correction probably in the 2nd quarter this year might not be such a big surprise after all. Michael: Yeah, I’ve noticed a lot of the news channels are still bullish, they’re still cheering it on, but you can’t underestimate that public sentiment. If it starts to go, everybody’s pricing in this big economic boom. If that doesn’t happen, you can’t underestimate what that can do to prices, as we’ve seen in commodities, as well. James: Absolutely. We start getting just a little more selling than buying. We keep buying the dips, buying the dips, buying the dips, and one of these times we’re going to cross a certain moving average that’s going to cause the computer to do some selling. Then all of a sudden, everyone’s racing for the door. The stock market’s not going to collapse. We’re not going to have an epic fall of 20-30%, but this long awaited correction that gets people to re-think their investment, that’s overdue. I think we could see that happen in maybe April or May. Michael: All right, well, lets talk about some ways people can get diversified, obviously what we specialize in. This month we’re going to talk about the cotton market. Some things are starting to take place there. It’s been on a pretty good bull market here for the last year or so. We’ve had lower supplies and cotton has just been gradually trending up. You and I have been talking about this over the last several weeks about we could be seeing a shift here, we think there’s some opportunities for selling premium. Talk a little bit about it. What do you see happening here? James: Generally, the ten commodities that we follow will have a spurt of buying from an importing nation and then will have a spurt of selling from producers that have an abundance of whatever the commodity is. What’s happened this past 12 months is we’ve seen Chinese imports have gone up dramatically over the 5-year average. That, of course, rallies the market. Cotton right now is at practically a 1-2 year highs. What’s so interesting, Michael, is that a lot of investors will hear that the Chinese consumption last year was up like it was and they’re going to pile in on this long position. I know we were talking a little while ago about the SPEC position in cotton. It’s at near all-time highs. It’s basically the herd driving into a market that sounds like it has bullish fundamentals, only to have the Chinese buying. Watch this- all of the sudden it will turn off the beginning of 2017. This timing coincides with plantings in the United States. They’re expected to be up some 10% this year. So, you have all this bullishness, you have all the speculators piling in. China is one of the greatest traders of commodities in the world. Obviously, they have the largest population and they need to feed them, clothe them, and provide energy. They seem to be some of the best traders, so they were buying cotton last year when cotton prices were low. Now, they’re at multi-year highs. Speculators pour in and now the U.S. farmer plants 10% more cotton than they did last year and now you watch the market turn back down. It’s a seasonal trade and it lines up with the fundamentals. Doing the opposite of what everyone else is doing right now in commodities has been quite a great trade over the last 12-24 months. Speculators race into the cotton market. All of the sudden, the fundamentals turn and all of the sudden you have them heading for the door probably this 2nd or 3rd quarter of this year, as well. Michael: Yeah, that’s an interesting point. You’re talking about prices going up on SPEC buying and demand. We were looking at the ending stocks for cotton and they are low by maybe historic standards but relatively over the last 4-5 years they are fairly high. I’m going to check my stat over here- I know I don’t want to get the figure wrong. Ending stocks for cotton this year at 4.5 million bales, that’s still the highest in 8 years. Now, what you’re talking about is you have farmers because prices are so high they are planting in 9-10% more cotton this year. We’ll know for sure here in our report at the end of the month. We’ll get planting intentions reports, but early estimates – if we’re planting 9-10% more cotton, plus we have that seasonal tendency for prices to start declining this time of year, those call premiums have really escalated up above the markets. You’re thinking this might be a good time to start picking some of those off? James: We do. It’s a great way to diversify a portfolio. Cotton right now is overpriced. The supplies worldwide are high enough to not cause any type of shortages over the next year or two. The Chinese buying is probably going to slow down and the United States is probably going to produce quite a bit more cotton than the last several years. It almost turns out to be a perfect seasonal play. We’ll wait and see if that’s the way it turns out. Michael: All right. Now, in our piece, we did write a piece on this earlier in the month, you can see it on the blog if you haven’t seen it yet, you were looking at the Dec 90 calls. Is that still a strike that you like right now? James: The Dec. 90 is like our dream call right now. We’re hoping that the market can edge up a little higher to reach that level. Selling cotton in the high 80’s is probably what we’re going to wind up doing. If we can walk into the 90 calls a little bit later in maybe April or May certainly we’d put our tuxedos on and jump into that trade. That one looks like a good one. Michael: That’s one we put out there for when we write our public articles. Obviously, when you and I are trading we’re doing this, often times a series of strikes, a series of months, sometimes even a series of strategies all in the same market for our clients. I think you kind of picked that one as a good example for people that may not be clients and are just reading this and seeing a typical type of strike we would look at. James: That’s how we would play it, both for our clients and anyone trading and taking advantage of short options or riding out there. That’s why I would steer them that way, yes. Michael: Obviously, for any of you listening to this that are interested in how we put these fundamentals together and select this type of trade, like in cotton, you’ll want to get a copy of our book, The Complete Guide to Option Selling: Third Edition. That is available on our website at www.optionsellers.com/book. You’ll get it at a better price there than you will at Amazon or your local bookstore. All right, so let’s move on and talk about one of your favorite markets, the crude oil market. We have been addressing this market over the last month or two, but we’ve come to a point now in crude oil where you think there’s some major fundamental shift going on and I think that’s presenting some pretty good opportunities for option writers. Do you want to give your overview of crude oil right now and what’s happening there? James: Michael, one of the markets that we follow most closely is because it has the most trading volume and open interest. We were earlier talking about speculative buying or selling and different commodities. Often, it’s based on headlines. We noticed that when OPEC announced production cuts earlier this year speculators raced in to the long side of crude oil. Headlines The Wall Street Journal: First OPEC Production Cuts in over a Dozen Years. Clearly, the market is going to rally, clearly it’s a great buy, it’s just a matter of how much money you’re going to make buying crude oil. That’s what speculators did. They accumulated the largest SPEC position in history right after the production cut announcement. What’s so interesting is that this herd mentality so often is wrong. Needing to peel back the onion just a little bit just prior to the production cuts, especially from OPEC, non-OPEC nations cut production as well, that’s not as important, with the exception of Russia, of course, which is the second largest producer in the world. The 3 months prior to the production cut announcement, OPEC ramped up levels of new supplies to the largest level ever. As a matter of fact, the production cut that was announced was basically equal to the increase in production the previous 30 days to 60 days just prior to the cut. Nobody hears about that. All people talk about is production cut from OPEC and the market’s going to go to the moon. Investors start buying calls and buying crude oil futures and crude oil companies, for those of you who are investing in stocks, at an all-time record pace. This past week, we’re now starting to count barrels and we’re looking for the supply cuts. Certainly, with all these production cuts by OPEC announced, we’re going to have smaller amounts of crude oil worldwide, right? Didn’t work out that way. Here in the United States, of course, the Permian Basin, the Dakotas, different parts of Oklahoma and Texas are ramping up oil production to all-time, all-time highs. The investors and speculators that push prices up to north of $60 a barrel for far-out contracts built in the greatest hedge that the people in Texas have ever believed that could absolutely happen. Texas production is approximately $16-$18 per barrel to pull it out of the ground. They were just allowed to hedge their production over the next 2-3 years at approximately $60 a barrel, a.k.a. printing money. So, the old adage of low prices curing low prices may not take place this year. Production in the United States is expected to make all-time highs at a time where OPEC is going to start probably becoming slightly fragile. OPEC production cuts, everyone is doing a fairly good job of following along with the cuts that they talked about and oil prices start to fall. OPEC nations then start to cheat and at that point we have a snowball effect. It’s probably too early for that to happen. June and July are very strong demand months here in the United States. We don’t expect to see prices really crater this summer, but this fall if we have a slight tick up in prices in June and July of this year then we’re going to be looking at call selling opportunities for December, January, February, March, the weakest time frames of the year, at the same time when supplies will probably be at their all-time greatest. We are watching with both eyes very closely for a small tick up in energy prices this June and July. Clearly, they’ve fallen off dramatically. We were talking about selling a crude oil when we did not believe production cuts to be so bullish, crude oil fell $7 shortly after that. I remember talking to clients and other people that are in the industry that don’t trade with us. I said, “Watch out! Don’t listen to this OPEC production business. It’s not bullish, the market’s going to likely fall.” We had a couple of colleagues that said, “James, why are you telling me this?” I said, “I’m just warning you because we think that the market’s going to fail here”, and he was basically saying, “Well, the whole world is bullish. We’re going to have less production.” It didn’t turn out that way. Oil fell some $6-$7 a barrel. We’re hoping for a slight up tick with strong demand for driving season this year in the United States. If we get that, we think call selling in crude oil could be good for 6-12 months out. Oil this fall and winter could be in the low 40’s, it could actually have a 3-handle on it, and we’re going to be taking advantage of that when that happens. Michael: Yeah, I just put together out summary. We sent our summary to CNBC this week on the oil market. Hopefully, they’ll want to have us on and talk about it, but if you’re listening, CNBC, we’re ready for you with our quarterly oil analysis. Feel free to give us a call. I know you, James, talking about the cuts, have not affected supply. In fact, right now, all-time record highs in the United States- 528 million barrels. That’s 27% over the 5-year average. So, I would think that still qualifies as a glut. Would you? James: Michael, that’s definitely a glut. If we have one more barrel in the world than we need, prices go down. We have just a dramatic over-supply in the United States. Ever since we’ve been counting barrels of oil in the United States, we have never had a higher supply than we do right now. At a time where production in the United States is now going to ramp up, it is a bearish scenario. Am I saying that oil is going to fall every day and it’s going to go down to zero? We’re not saying that, but as far as the investors that like the herd mentality, this June and July we’re probably going to have more ramblings out of OPEC. They’re going to say, “We’re going to extend the cuts. We’re happy with the way it’s working but we’re going to proceed to extend these cuts further.” We’ll probably get another pop from that on the bullish news, and that’s the one we’re going to use to probably lay out some calls out 6-12 months and I think that’s going to work out pretty well. Michael: For those of your listening that may not be that familiar with option selling, what James is really saying is we don’t need prices to fall, although we think that’s a distinct possibility, we just don’t need them to go skyrocketing up in this environment. With this type of supply we don’t think that’s likely, that’s why we go high above the market and sell calls. As long as the market doesn’t get there, those calls expire and investors keep the premium. Did you have your eye on any strikes you want to share right now or do you want to save that for another podcast? James: We’re going to be selling crude oils calls with a 7 on them, and I don’t mean 7 or 17, I mean 70. If they’re producing oil in Texas at 17, we’ll go short at 70. We’ll take our chances on that and I think it’ll turn out pretty well. Michael: All right. For those of you who want to read our full forecast and analysis of the crude oil market, along with some potential trades you can look at, that is coming up in our April newsletter. It’s going to be coming out within the next couple of days. Look for it in your mailbox. If you’re not a subscriber yet, you can subscribe at our website. If you come to our website and order anything you’ll be on our subscription list. We do have a special crude oil feature this month because this is the trade we’re going to be looking at now for the next several months. One thing about option selling is if you’re taking premium out of a market, you don’t just have to sell it once and take it, you can often keep mining premium into that market for months at a time. Am I right? James: That’s how we do it. Michael: Okay. In addition, in your upcoming April newsletter there’s also a special feature this month on some of the top mistakes high-net-worth investors make, particularly 1 percenters... people that are in that higher-net-worth strata, that even though we tend to be sophisticated investors, at the same time there are some blind spots there. We did a lot of research here, a lot of different reports we found, and I think you’re really going to be fascinated to see some of these things. A lot of them, James, you wouldn’t even think of as high-net-worth investors making these type of mistakes, and they do. We really put that in perspective and I think a lot of our readers will enjoy it. James: You know, money doesn’t come with instructions. So often, you hear about investors that are making their money in whatever line of work their business or company that they had, and when they go to invest on their own they don’t quite have the success. A lot of our investors, the clients of ours, made their fortunes being experts at what they do and hiring someone to do it for you is probably a pretty good idea. Michael: Well, the first hint is don’t keep it all in the stock market. I’m sure most of you probably know that. So, we’re going to move on to our lesson portion of the podcast this month. James, this month we’re going to talk about an aspect of risk management. We did a piece on some more advanced ways to manage risk this week on the blog and we got a lot of feedback and a lot of questions. Thank you, all you viewers, for that. One of the things and questions we got there was, “Well, that’s great for naked options, but what about if I’m doing a strangle? How do I manage my risk on a strangle? I’ve sold a put and I’ve sold a call on the same market- how are you managing risk on those?” I think that’s something we want to talk about and address some of our readers who maybe want to learn how we do that. James: One of our most attractive commodity options sale that I find when I’m scouring the 10 markets that we’re closely watching, and that is identifying fairly valued markets. Quite often, you will have CNBC or Bloomberg go to the pit and the gold market is down $20 or it’s up $20 and people are talking, “Oh, the gold market got hammered today. The gold market’s soaring today.” A $20 move in gold makes a headline. It makes a headline on T.V. and they go to the pits and they’re talking to the traders and what have you. A $20 move in gold doesn’t move the needle for the options that we sell. When we sell options on crude oil or coffee or gold, often they are 50-60% out-of-the-money. So, these 1-2% blimps in commodity prices for the underlining contract makes a lot of headlines, but as an option seller, whether it’s yourselves doing it for your own account or we’re doing it for you, it very rarely even moves the needle. When selling a put and a call in gold or silver or crude oil, often the distance between the put and the call is the same value as the underlining contract itself. In other words, gold is trading around $1,200. We have option sales where we strangle gold and the strangle is $1,000 wide. So, identifying fairly valued markets, gold happens to be one of them right now, we think it’s pretty close to fairly valued, the put and the call they babysit each other while you’re waiting is basically the best way I can look at it. For example, if you’re short a gold strangle, your call is $500 above the market, your put is $400 below the market, this one is offsetting the other one at the same time. So, in other words, if the gold market moves $20-$30, your call position might go against your slightly, but your put is now taking care of the differential between from where you put the initial position on. If you use the 200% rule, and we do that ourselves, it is a very, not necessarily strategic, but it’s a very easy management tool that you can use. If you have 12 positions on in the year and 2 of them double in price, do the math. That still can be a very, very great return and it does hold your risk parameters in check. If you are selling a strangle in gold, you might take in $600 on the call, $600 on the put, you have $1,200 worth of premium. Not only will a naked call or put often double, unless the fundamentals change, but that $1,200 in premium that you take in on a strangle, that will almost rarely, practically never, double in value. So, if you have a $1,200 premium in strangle, the $1,200 level for it to double to $1,400, rather $2,400, just happens so rarely. The strangle is our best approach to markets that we find that are fair valued. If you do have your put or your call pinching you just a little bit you’ll notice that the opposite direction option is doing extremely well for your account. Needless to say, you have to have risk control parameters when you first enter a position. You can put in a 100% rule on your short put or your short call. I would put 100% rule on the entire premium itself. It gives your position a great deal of time and room to work. The strangle, I think, is the very best option sale going. If you want to keep a very close reign on your put or your call you can do that. If you wind up stopping yourself out of a strangle on most commodities, in my opinion, you’re not selling enough time. A lot of investors and a lot of books talk about writing options, they talk about a 30 day, 60 day, 90 day option. If you’re getting stopped out of your short position, those are probably the options that you’re selling. I would go further out in time and in price. Commodity options you are paid to wait, and patience is the name of the game. If you’re able to put on a strangle and you’re able to wait, more times than not you’re going to have very good results. You’re not hitting homeruns selling a strangle that far out, but for those of your who want to win the game and are okay with hitting singles all year round I think that’s a great way to do it. I think our investors certainly know about that and our viewers could find that out for themselves if they wanted to. Michael: One way of looking at that, you’re talking about risking the whole premium of the strangle. In other words, you’re saying if you take in $1,200 you can risk up to $1,200 on either side. So, actually, you can be a little more aggressive on your risk management on both sides because you have that balancing affect on the opposite side. Correct? James: Exactly right. Michael: So, instead of risking your call to double value, you can almost risk it to triple value and still get away with it because you have some extra risk management with the strangle if you’re following that. James: The stay ability in a strangle, and that is the key to option selling, is being able to ride out the small blips in the market that change the premiums. Patience and the ability to wait is the key and a properly placed strangle will give practically anyone the ability to stay with that market. That is something that we find at our office for our clients that we do a great deal. The proof is in the pudding. The strangle is a great way to go. You need to identify a fair value market. If you’re able to do that, the strangle is going to be very fruitful. Michael: One of the things we talked about this week in our risk management lesson is the purpose of the risk management tactics often is just to slow the market down long enough to let them expire because time is always working in your favor. So, if you’re using a strategy like the strangle where you’re risking premium to a certain value, you can also incorporate things like a roll. You can use a roll in a strangle where you’re rolling up or if fundamentals change then maybe you just roll it into a one-sided trade instead of just a strangle. Getting a little more creative there, but all of those strategies that we talked about can also be applied to spread, even to a strangle, to get a little more advanced. James, when you’re talking about that, the 200% rule is a good basic rule that can be used either with naked or with a strangle you just described. James: Correct. For all the times you put a strangle on, there’s a chance your put or your call will double in value. As long as the fundamentals in that market didn’t change, feel free to roll down the put or roll up the call. 9 times out of 10 that will not double again and you will be collecting 75% of the premium that you originally sold for instead of 100%, but that’s a very great investment. Michael: Excellent. Well, I hope everyone’s enjoyed our first audio and video podcast this month. For those of you that are writing in asking questions and sending them, please keep those coming. We love to address those on our shows, such as this. For those of you interested in our accounts, unfortunately we are fully booked for April. We are working into our May availability now. We still have some availability for new accounts in May. If you’re interested in learning more about this, please call Rosemary at the office. It’s (800) 346-1949. She’s scheduling consultations, which will take place in April. So, if you’re interested in one of those, give her a call. She can get your scheduled. James, I appreciate your input this month. We’ll be back next month and we’ll update some of these trades and see what’s going on then. Thank you, James, for everything this month. James: My pleasure. Always happy to do this. Michael: For all of you out there, we will talk to you in 30 days. Thank you.

OptionSellers.com
The First 60 Days of 2017 – Target High Yields with these Top Seasonal Option Sales

OptionSellers.com

Play Episode Listen Later Feb 16, 2017 25:54


Michael: Hello, everybody. Welcome to the January 2017 edition of the Option Seller Radio Show. This is Michael Gross of OptionSellers.com here with head trader, James Cordier, of OptionSellers.com. We’re starting off a new year here in the week of the Presidential Inauguration. James, it appears markets may be treading water here, kind of waiting to see how things play out after the Inauguration. What are your thoughts on the markets here as we start the new year? James: Well, Michael, welcome to 2017, as well. Really excited about the next 12 months, and we’ll see what the markets offer us as far as opportunities and looking at landscape as we go forward. The stock market certainly got a shot in the arm after the election, thinking that a Trump presidency is going to be very business friendly. The stock market certainly enjoyed that; however, over the last 3-4 weeks it is simply treading water going sideways, waiting for another idea. As far as “Will this actually help the economy? Will some of the Trump policies that are being tossed around actually be and do what we are hoping for the economy?”, the stock market is kind of going sideways waiting for a little bit more information. I think you’re right – right after the Inauguration I think people are going to get either the warm and fuzzies of the new president or possibly a little bit of a caution and then the stock market has some profit taking. The one thing that’s interesting right now is the put-call ration is the most bullish it has been in the stock market in years. Usually, that’s a bit of a caution flag for the market to have a correction. I guess we’ll find out in the next few weeks. Michael: Yeah, I saw Soros is one of the guys that took a beating on betting against the stock market with the Trump election. The big shooters aren’t always right. Of course, us here, we don’t trade the stock market but we do watch it closely, primarily because: one, a lot of our investors are in it and, two, because it can have an overall impact on a lot of other things going on in other markets. So, not a direct impact, but it’s something that we do keep an eye on. What we’re going to talk about here this month is obviously diversifying into commodities and we’re going to talk about a big advantage you have as a commodities investor. That big advantage is seasonal tendencies and commodities. January offers a plethora of seasonal tendencies that we can watch and take advantage of, and that’s what we’re going to talk about this month. James, why don’t we start out with some of our listeners that may not be familiar with seasonals. We do talk about them a lot, but maybe just start off by explaining exactly what a seasonal tendency is in a commodities market. James: Michael, that’s a really good point that you make about seasonals that do come up this time of year. For currency traders, they don’t know what a seasonality is. Trading silver, you probably don’t know what a seasonal is; however, trading corn and coffee and heating oil and crude oil is simply a propensity for a market to make a particular move during a particular time of the year based on supply and demand. New production that comes online certain times of the year, some of the biggest demand, certainly, for certain markets, comes at a particular time of the year. For example, heating oil and crude oil often starts getting large demand in the winter for heating oil and driving season for crude oil. The coffee market certainly gets a bump usually in December and January as demand for coffee, especially in the western hemisphere, does increase as temperatures cool. The propensity for the market to fall off starting March, April, and May, when temperatures in the United States and western Europe start to warm, people simply drink less coffee. That’s basically the ABC’s of seasonal trading. It seems incredibly simplistic but if you followed, and certainly we follow, the price of unleaded gasoline going into driving season, and the price of soybeans going into planting season, you become a true believer. Certainly, that is something how we like positioning portfolios using a portion of seasonality to diversify accounts, and January-February seem to be 2 months that offer the most trades like we’re describing. Michael: Now, we are going to talk about some of the more pronounced seasonal tendencies that do tend to happen in January and February, but, before we do that, we want to cover briefly here one of the mistakes people make, and maybe one of the misinterpretations people have about seasonal tendencies. A lot of people, when they first find seasonals, they look at them and it looks like they’ve found the Holy Grail of investing, the secret hand behind the markets. There are certain factions of truth to that, but the mistake most people make is they use them improperly. In other words, they may look at a seasonal chart and say, “Boy, this average looks like it falls every year on January 10th, and so I’ll sell it on January 10th and buy it back on January 31st because that’s when it looks like it goes up again.” What people don’t realize is that’s an average and trying to time that to the day is extremely difficult. A lot of people that try and do that end up losing and then they say, “Oh, well seasonals don’t work. They’re no good.” That is absolutely not the case; in fact, when you combine the strategy of selling options with a seasonal tendency, it can become a very powerful asset to your investment arsenal. James, can you maybe touch on or explain why that’s the case? James: Well, option selling, as the majority of our listeners know, is certainly putting odds in your favor. A lot of our clients and a lot of people that we speak to make it seem like you’re betting against the house. We are the ones selling the options, the people that come into the casino, if you will, are buying options. When you take the percentages of options expiring worthless and you combine that with seasonalities of when the market usually rallies or usually falls, you’re really putting the odds in your favor, but you have to keep your eyes open. Every single year you’re not going to have a seasonal tendency work the way it does on its 15 or 30 year average. You need to be aware of what the current conditions are in that particular market and see if it’s trading seasonally prior going into a sell or a buy for a particular market. Michael: One thing to mention there, too, is if you’re a futures trader or even some guys try to trade ETF’s with seasonals, which I do not recommend, but for futures traders, their timing has to be perfect. Option sellers, you don’t need perfect timing because you’re selling way above or way below the markets. So, if you miss the seasonal move that happens a couple weeks early or a couple weeks late, it doesn’t really make a big difference to you as an options seller, where if you’re a futures trader it can make a huge difference. So that’s one additional reason why combining option selling with seasonals can be such a powerful strategy. As far as the markets, I want to talk about one, James, you and I spoke about earlier that’s a little bit different this year. That’s the crude oil/unleaded gas market. We talked a lot in November about some possible big moves coming up in seasonal’s tendency in crude oil, the potential for prices to start moving higher, and we’ve had a little shift this year. Do you want to talk about that and what you’ve seen happening this year in the crude oil market seasonally? James: Michael, it’s interesting, crude oil and unleaded gas normally is extremely weak in the December-January time frame. Then, as you start approaching driving season, you normally see a large increase in price, albeit slow and steady, but it does go from its low in January to often its high in June and July. 2017 is certainly a different trade this year. With the first announced production cut by the largest world oil producers in the last dozen years, certainly it’s going to change the seasonality for this year. We were seeing crude oil pushing down into the low 40’s and then, lo and behold, Saudi Arabia and Russia and some of the other largest producers in the world decided we need to do something about balancing this market. They did come together and they did announce what seems to be production cuts that are sticking, to a certain extent, and the oil market, which normally rallies from January to June, made that entire rally the days and weeks after the announcement. So, like I was saying earlier as far as keeping your eyes open in reference to what’s happening on any particular year, 2017 is a perfect example of that. Michael: So, you think as far as a seasonal move goes, where the normal seasonal for crude or unleaded tends to start pulling prices up in January in anticipation of driving season, you think we’ve already seen the bulk of that move already? James: I really do. We will have stronger demand for products such as gasoline starting in March and April; however, we have oil pushing in the low-mid 50’s right now. A lot of the production cuts that apparently will take place at approximately 1 million barrels, it’s thought that those missing barrels can come back onto the market relatively soon. We’re expecting the seasonality this year of higher prices going into driving season muted quite a bit. Michael: So, in the near term, you’re not necessarily bearish prices, you’re just not as bullish as you normally would be, simply because the price has already moved up. What’s the strategy to trade it then? James: Well, the strategy is actually one of our favorites. The fact that we do have fewer barrels coming online from OPEC and non-OPEC nations should underpin the market. We should not see oil trade into the low 40’s, certainly not the high 30’s, going into driving season. That certainly is not going to happen, especially with the OPEC and non-OPEC production cuts. We would be really interested in selling puts in the low-mid 30’s for crude oil for later this year delivery. At the same time, the fact that the market has already done its seasonal rally and we expect the U.S. production to come online, we would not see oil go into the mid-upper 70’s. Practically ideal for the clients who follow along and the listeners that we hear today that know about what’s called a strangle, you would sell crude oil puts in the low 30’s and crude oil calls in the high 70’s. I think that is a really good opportunity as far as collecting premium on both sides of the market. There’s a lot of volatility and that’s when you get the luxury of being able to sell a strangle. I think, right now, the crude oil market is practically ideal for doing that right now. Michael: … and that’s what, close to a $40 strangle there? That’s a $40 window prices could move and both options still expire worthless? James: Well, that’s how we started out the conversation today with selling options far out-of-the-money. We’re strangling oil $40-$45 from the put to the call and we feel very confident that crude oil, which used to have large swings in the past, is not going to have a move like that, not in 2017. Oil is a great value in the mid 40’s. It’s quite a sale if it gets in the 60’s. Certainly, our strangle would be $10 above and below that. That’s the way we like to play it. Michael: All right. For those of you listening that want to learn more about seasonal tendencies, how they work, we did devote 2 full chapters to seasonals in The Complete Guide to Option Selling. If you do want to see some of our favorite there and some of the ones we recommend for individual investors you can find those in chapters 15 and 16. That’s in the new Third Edition. Of course, if you want to purchase a copy of that you can at www.optionsellers.com/book. You get it at a discount at Amazon or Barnes and Noble there. Let’s move on to talk about another seasonal tendency that does appear to be tracking closely this year, and that’s over in the grain markets. We have 2 markets there we’re watching very closely. Both the soybean and the wheat market have strong seasonal tendencies that tend to start in January. I’m going to talk about wheat here for just a second. As far as the tendency goes in wheat, wheat has a strong seasonal tendency to start declining in price in January. Unlike most of the grains, wheat is the only market that can grow in the winter. In fact, you may not know this, but, 75% of the wheat grown in the United States is winter wheat. Therefore, that gives it a different seasonal tendency than the other grains, from oats to corn to soybeans. Winter wheat sprouts in January, typically. Unlike the other commodities, it doesn’t have extreme heat to deal with. There are some weather factors, but typically once that wheat crop sprouts a lot of the anxiety comes out of the market and once that sprouts and it starts growing, a lot of traders will start selling wheat because the fear of the upcoming winter wheat crop tends to start to come out of the market. That’s why you often see wheat prices start to decline in winter and continue that weakness through spring. Obviously if your investor wants to take advantage of that, you may look at a call selling approach. We’ve taken that a step further and that involves a different market. That’s the soybean market, which has a different seasonal. James, you’re going to talk about soybeans here a little bit. James: Michael, that’s interesting. A lot of investors, whether they’re close to commodities or they simply keep one eye on them from time to time, would think that corn, wheat, and soybeans are always moving in the same direction. Soybeans have very different fundamentals and very different seasonality than the wheat market does. In the winter, January and February especially, demand for soybeans and soybean meal is at its greatest, as many U.S. producers and producers around the world are feeding livestock. Of course, that is when demand is the greatest for protein seed. At the same time, in South America, quite often you’ll have weather problems because it is grown in so many areas. Especially in Brazil and the surrounding southern countries of Brazil, they seem to be having, once again, some weather developments down there that are supporting prices. At the same time, the weather in the United States, for especially the Midwest, is always either too wet, too dry, too hot, or too cold. Sure enough, a weather premium starts getting built in the months of March, April, and May. For soybeans, January is usually quite a strong buy time as far as expecting prices to start moving up, just the opposite of the wheat. For those reasons, we like selling puts below the soybean market in the months of January and February. It’s almost a squeeze, if you will, by being short wheat and going long soybeans over the next 90-120 days. Certainly, that is something that we have followed closely in the past and, sure enough, looks like it’s setting up again for 2017. Michael: Yeah, we talk a lot about combining strategies to boost your odds, how the option strategies you can’t just view them in a vacuum when you’re trading them in a portfolio. You look at how one position offsets the other and a perfect example of that is one of the things we’ve talked about here. It’s called the Minnesota Squeeze. We’re not going to go into it here, but we are going to explain that in detail in your upcoming Option Seller Newsletter, which is slated to come out next week. We have a very special combined January/February seasonal issue and we are going to show you how you can combine these two seasonals to really boost your odds when it comes to getting those worthless expirations, selling the wheat into the growing season fade, and in buying the soybeans on the potential weather rallies in addition to winter being a high-demand season for soybeans. That will be in your upcoming special issue January/February newsletter. Look for that the week of January 23rd. In addition to that, in your upcoming newsletter, it is a special issue on seasonals so we’re going to talk in a little bit more detail in some things you can do to put these seasonal tendencies in your favor. It really is an advantage you have as a commodity options seller, as opposed to being in the stock market or bonds. It doesn’t really exist in any other asset class, so it’s something you can take advantage of in commodities. We’re also going to cover another subject that’s near and dear to our reader’s hearts and that’s staying properly diversified and how sometimes investor fear, even savvy high-net-worth investors, can let fear get in the way of getting properly diversified. There’s some good stuff in this month’s newsletter. I hope you enjoy it. James, before we go this month, let’s talk about one of your favorite markets, as we continue our coverage of big seasonal tendencies this month, that is the coffee market. We just published a special coffee article this week that is available on the blog at www.optionsellers.com/coffeejan. Let’s talk a little bit about coffee. We’ve got a strong seasonal tendency for weaker prices coming up here. Can you talk a little bit about that, James, and why that tends to occur? James: Michael, the coffee market looks like in 2017 it will be trading seasonally. Often, the winter time frame is when many of the producers in South America and Central America have to watch the weather quite closely. As long as those areas get ample rains, cherries then form on trees and, of course, those become green beans and later on roasted into the lovely mocha color that we all enjoy… most of us do each morning. Once the fear of the weather patterns in South America and Central America dissipate, and they usually do, that is normally short-lived and it looks like set-up is taking place again this year. At the same time, during the winter period is the strongest demand. So, we do have in western hemisphere areas the strongest and most consumption of coffee is in the winter and colder months. As we get into March, April, and May a lot of tendency does go to either soft drinks or flavored waters and I know that sounds kind of interesting to be talking about that, but when you multiply it by 300 million people in America, changing their drinks by just a slight amount really does make a large difference. Quite often in the winter, we have the most fear for any type of drought conditions in the coffee growing regions. That is now behind us. Coffee consumption in the United States will start to taper in February and March, and that is why we usually look to sell calls in coffee at the very beginning of each year when the seasonality and propensity seems to be setting up. 2017 looks like, yet, another year to be selling calls in this market. Coffee has been trading around $1.50 a pound on and off for the last quarter or two. The market did bump up here recently on what was expected to be a slightly smaller production in exports out of Vietnam. Then, earlier this week it was just announced that Vietnamese exports were up 25-30% from the previous year. Once again, knowing your fundamentals is really important. When you can combine that with the seasonalities and the odds of selling options, you can find out just by watching this for maybe 12 months why we do follow seasonalities and why it can combine with selling options to be really good for someone’s portfolio. Not every single time, like any other investment, but, on the averages, I like where we stand. Michael: Needless to say, as an option seller here in January/February, certainly no shortage of opportunities coming our way. If you’re a managed client, you have obviously seen the majority of these trades in your account thus far, and we certainly look forward to some more of those coming our way as we work through the first quarter. If you’re not yet an account, these are markets you can look at and maybe learn a little bit more how these trades work. We do have some availability for new account consultations in February. If you are interested in a managed account that is your first step. You can call Rosemary at our main office at 800-346-1949 to inquire about availability for those. If you’re one of our international listeners you can call at 813-472-5760 or you can also e-mail… that is office@optionseller.com. James, thank you so much for your insights this month. James: My pleasure, Michael. Always great chatting about what it is we do for our clients and our listeners. Beginning of this year looks like there might be some very good landscape and some very good opportunities. We’ll just have to wait and see. Michael: Well, perfect. Everybody, have a great month of option selling. It’s 2017- if you’re not diversified into alternative assets this is a great year to think about it. We wish you all a great month of option selling and we’ll talk to you next month.

OptionSellers.com
Get Uncorrelated to Equities! Softs Markets Offer Option Selling Opportunities Ahead of Election

OptionSellers.com

Play Episode Listen Later Nov 23, 2016 35:44


Michael: Hello, this is Michael Gross here with James Cordier of OptionSellers.com. We’re here with your October edition of the Option Seller Radio Show. This will probably be or will be the final Podcast you’ll here from us prior to the election. The next time we speak we will have a new President-elect. We have a lot of things going on this month. Some investors worried about the stock market looking like it might be getting a little bit toppy, a lot of interest in diversification and uncorrelated assets. Right now, we’d like to talk to James a little bit. James, maybe just give your overview on the state of the markets right now leading up to the election. What’s your feel on just the general vibe right now? James: Well, Michael, quite often people try and front run the candidate who looks the best and some people actually, investors alike, want to try and take advantage of who they think is going to win the election. Quite often, what does best is when we have status quo. Quite often, everyone’s expecting “Well, if a democrat is elected President, then the market is going to do this. If it’s a republican, it’s going to do that.” Looking back on the history and looking at the 12 months post election, there really doesn’t seem to be a strong correlation. It appears to me that what the Federal Reserve is doing is more important. Chances are, going into 2017, I think that’s the same way it’s going to play out if we continue to have interest rates at a quarter and a half, if Janet Yellen and the Federal Reserve continues to keep hands-off of interest rates going higher more than a quarter percent. I think we’re going to have basically the same market that we have right now, probably for the next 12 months. I don’t see a big change no matter who gets elected; however, there will be some extreme movements in the market prior to the election and probably right after. I also then see the market just kind of steadying out and then going back to the fundamentals and they’ll quite possibly be the fundamentals that we have right now. Michael: James, that’s a great point. A lot of investment shows right now and magazines are talking about which stock you want to buy if Hillary wins and which stock you want to buy if Trump wins. Do you go short the market or do you go long the market ahead of the election. Like you said, I’m guessing a lot of that’s going to be knee-jerk type reaction stuff and serious investors are looking 1-5 years down the road, they’re not looking 2 or 3 weeks into the future. On that note, we’re going to talk a little bit here about getting diversified and, of course, what we do is in the commodities markets. A very interesting sector we’re going to cover this month is the softs markets. We have some great fundamentals and seasonals but also some complete non-correlation of what’s going on there. I know you wanted to talk a little bit about that. Let’s talk about coffee and sugar, first. Some strong bull markets there. What’s going on in coffee? What’s your take right now? James: The coffee market is almost similar to the oil market, where Brent crude oil and WTI crude oil, in some cases, have different fundamentals. Clearly, if Brent is rallying $5 a barrel then WTI’s going to rally 3 or 4… they usually go in the same direction. Robusta coffee is completely in the news right now in stealing the headlines as Robusta coffee, which is produced in several different countries, namely Brazil and Vietnam. We definitely have a shortfall in the more acidic coffee bean known as Robusta. It’s normally grown in lowlands, it’s not as sweet as Arabica coffee; however, it does make up a large portion of world supply and demand. Production in Brazil right now is going to be down about 10-15% because of dry conditions for the Robusta beans. At the exact same time, production in Vietnam because of weather problems and concerns is down some 20-25%. Robusta coffee beans are absolutely on fire right now. They continue to make new 12-month highs, and that’s what has been dragging up the Arabica coffee. It has been trading between $1.40 and $1.60 for the last several months. We’re pushing up along $1.60 and we think that the fundamentals will start separating themselves and we’re probably going to have a two-tier market going into the end of 2016 and the beginning of 2017. The reason why is while Robusta coffee beans are extremely tight, Arabica beans are just the opposite. We’re looking at a record production this year in Brazil. We’re looking at Arabica coffee production for the year 2016-2017, looking at a 6-7 million bag surplus, and that will definitely be putting a cap over prices as we go into the end of this year and the beginning of next. Seasonally, it is flowering season in Brazil. Traders watch that extremely close. As long as we continue to have extremely favorable conditions for flowering season in Brazil, like we have right now, we see a very large crop production next year and the Robusta beans that we lost because of dry conditions this past year will probably be fixed going forward. We see both Arabica areas and Robusta areas of Brazil getting ample rains and we should have a pretty nice rebound in Robusta production next year, as well as Arabica. We’re probably looking at the mid to upper 50’s again for production. At the same time, we have Columbia producing a great deal of coffee going forward. They’re going to be setting new records and we think that this rally in coffee, especially the Arabica bean, is probably going to be short-lived. Michael: James, that’s a good point you’re talking about that’s the two-tiered market because you have both Robusta and Arabica prices. Arabica makes up the majority of the ICE contract that we trade. Is that correct? James: It is. It is a blend; however, the majority of it is Arabica beans. As long as that’s the case, we could have a two-tiered market. I’ve been trading coffee for decades and usually they go in lock-step with each other. We’re going to see that correlation dissipate some later this year and we think that coffee around $1.60 right now really holds a great opportunity to go short. We would be selling coffee calls for 2017 strike prices nearly double the value that they are right now. We see coffee probably settling down to around $1.45-$1.50 later this year as flowering season continues to go well and fears of a small crop again this year, especially for Robusta beans, that seems to go away and then we’re looking at large supplies again next year. Michael: It seems like the market really ran away. Looking at the fundamentals, I can see what’s going on with the Robusta and that’s driving price up, but you look at Brazil’s total coffee production estimate… I’m looking at 49.4 million bags, that would be the estimate right now, although estimates vary depending on what source you get it from. It’s lower than the last couple of years, but it’s not that low. That’s still a pretty solid figure. When you’re talking about the seasonal for Arabica coffee prices, or at least the ICE contract, looking at a 5 year seasonal right now, the thing that seems to come to a pretty good top right in the middle of October and then just falls off a cliff. You’re talking about flowering, maybe some of our listeners might not know exactly what that is. What is flowering? Why is that so important? Why does price tend to come down afterwards? James: Well, flowering, of course, is the period in the year when the tree develops a flower, the flower turns into a cherry, the cherry turns into a coffee bean. It then gets picked and it gets roasted. It is called green coffee bean after it gets picked from the tree. It then is either roasted on site in Brazil or it is shipped to different areas like New York, New Orleans, and Atlanta where they do roasting there, depending on what type of brew they want. If we have ample rains during flowering season, trees can flower 2, 3, and 4 times. If in fact the flowering season does take place like it is right now, we’re looking at a tree that has the ability to produce anywhere from 15-20% more coffee beans than it had if it was a dry season. That is why this period of October and November is so crucial to understanding the size of next years’ crop. Precipitation in the majority of the Brazilian coffee areas started off early this year. That can be a two-edged sword. If it starts early and then it cuts off, that can be detrimental to the coffee production. If it starts early, like in August and September, and rains continue through October and November, a tree can flower 3 or 4 times versus just 1 or 2. Simple math tells you that the production next year could be greatly increased by ample rains. That’s why we have a critical time period in October. That’s why the prices usually rally during fears of possible dryness, like we had last year. Once inspection of these trees takes place and the flowering went either well or very well, like it appears to be this year, you can start putting the numbers for coffee beans and bags of production next year already into a spreadsheet and you can tell exactly what type of surplus we’re going to have the next year. It’s almost like science right now as far as coffee production in Brazil. We do have the ability to do that and right now it’s looking like a very healthy crop next year. Michael: So in the flowering season, that anxiety builds prices up. After we get past flowering, that anxiety tends to come out of the market and that tends to drive prices down into the fall. The seasonal chart seems to reflect that pretty good. Let’s talk just a minute about sugar. I don’t want to get too far into that, but sugar prices kind of mimicking coffee prices – really on a tear. Are we looking at the same type of fundamentals there or is there something else driving sugar? James: Sugar has rallied for completely different reasons. On sugar we actually have a production deficit this year. It’s the first deficit we’ve had in approximately 6 years. We’ve had sugar deficits in the past. The market does rally certainly when that happens. This year, there is anxiety as to whether it’s a large deficit or small. A lot of the most recent indications is we’re going to have a smaller deficit than previously anticipated, but, nevertheless, world production is going to be less than consumption, thus a deficit. That is why sugar’s probably rallied from around 16 to 17 cents up into the low 20’s. We think that we’re going to be seeing more production in the coming year or two as producing sugar at 22 and 23 cents is a windfall for producers, especially in Asia. Of course, China is the big consumer right now. That’s what has created the deficit. Often, we’ll see China purchase sugar and it’s though they’re never going to be eating anything other than sugar and all of the sudden they just turn off the buys and all of the sudden the production deficit that you’re looking at turns into more of an even balanced. We think that’s what’s going on right now in China. We think that they bought a lot more than a lot of people were anticipating; however, they’re very great traders. Chinese buy soybeans and cocoa and sugar based on trends. You’ll notice that they seem to buying every day and all of the sudden, once they have enough, they stop buying, the price falls back, and then they wait for another opportunity to get in. That’s what we think is going on in sugar. Sugar does have a similar seasonal. As harvest in Brazil and other areas concludes a lot of sugar gets dumped onto the market. We think that’s what’s going to happen later this year. We see sugar probably falling back down to 20 cents, maybe 19, so we are looking at call opportunities in sugar much above the market. We are still doing more work on what type of production figures we have, so we’re holding off on selling right now, but we see ourselves probably doing that in either November or December. Michael: So, in sugar you have a somewhat bullish fundamental of stocks to usage ration right now just under 19%, which would be the third lowest in over 20 years. That’s what’s driving prices up, but what you’re saying is that eventually, at some point, high prices cure high prices and you see that happening right now in coffee and possibly sugar, as well. Is that correct? James: Coffee for sure. We haven’t seen coffee at the $1.60 level for quite some time. The big situation that has caused coffee prices to rally is weather. As soon as we have weather changes, of course El Niño has now changed to La Niña, so we went from a dry pattern to a wet pattern. That’s already showing up in Brazil. We expect it to show up in Vietnam, as well. So, as they have better weather for 2017, this 20% reduction in their production this year should probably snap back to a smaller sell-off as far as the value of their coffee. As long as we have decent weather in the western hemisphere, we expect Arabica beans to probably go under pressure possibly $1.40-$1.45 at the beginning of next year. Michael: Now, if you’re an investor and you’re listening to this at home and you’re hearing James talk about different factors affecting coffee and sugar prices, on the surface some of it might not make sense to you. One thing to understand here is in commodities; we’re talking about the fundamentals right now. These are the underlying supply/demand factors that really drive prices. If you really want to invest in commodities, knowing these fundamentals can give you a tremendous advantage over the other investor who’s just sitting looking at a chart, looking at technical indicators, having no idea what’s actually moving prices. That’s why these things are so important if you’re going to trade these type of markets. Knowing this information and what’s really driving price can give you an advantage in the market that frankly most investors don’t take the time to learn or they don’t know even while they’re trading. One thing we also want to point out here is diversification aspects. When you’re talking about coffee and sugar prices, those are what’s known as softs markets. There’s other softs markets, too, such as cocoa, cotton, orange juice. Cocoa has moved the exact opposite direction of coffee and sugar. So unlike stocks that tend to move in tandem, commodities can move completely on their own. Cocoa is almost in a bear market right now, James. It looks like we maybe making a low, but very low prices right now in cocoa. James: The cocoa market certainly has just fallen off the table here recently. It was in the low 3,000’s per ton and now we’re trading around $2,600 per ton… a very large move to the downside. I think a lot of anticipation was similar to what we just discussed in sugar. We had very strong buying out of Asia, and then they just stopped the buys. That’s what’s taking place right now. Production in the Ivory Coast is about what was anticipated. Production in Brazil is about as anticipated, but the buying just stopped. We feel that a lot of manufacturers, that’s what you call the people that turn cocoa beans into chocolate bars that taste so good, they’re the ones that dictate the price right now. When production is steady, what’s the difference? That is whether manufacturer companies are buying or they’re not, and they just basically stopped buying completely. A lot of traders inside the cocoa market thought that there was going to be a large shortfall and it just turned out that there wasn’t, and that’s why cocoa has fallen off so much. Michael, just to point out a couple things that you were just referring to, the data points that we’re referring to and talking about Vietnamese production and the weather in Brazil, this just not tell us, as you know, what the price of coffee is going to do next week. It doesn’t tell us what it’s going to do next month. What it tells us is where the price is not going to go. That is the key to understanding the fundamentals to the market. If someone’s listening to us today and they think they’re going to trade coffee and take 2 cents out of the market and then continue programming their computer to buy and sell on the market based on these fundamentals, that is not what this program’s all about. This program is for people understanding the fundamentals the fundamentals won’t allow the market to fall 50%, it won’t allow the market to go up 100% without our prior knowledge, and that’s what we’re doing here. Anyone listening right now, the fundamental factors will allow the market to move a small amount, but if they’re bearish the market won’t double in price, if they’re bullish they won’t fall 50%. Those are the option strikes we’re selling, and that is how we sleep at night trading markets like coffee, cocoa, and sugar. Michael: One question for you, James. These market’s you’re talking about… coffee, sugar, cocoa… they’re trading on the weather, they’re trading on what their supply is, they’re trading on how much they plan to ship next month. DO these prices care one iota about what’s going on in the stock market? James: No, they don’t. The beauty behind getting diversified, the beauty of being diversified in something like commodities, whether the stock market goes up 20% next year or down 20%, the value of cocoa will probably not change, the value of coffee probably won’t change, the fundamentals certainly won’t, and that is the beauty of being diversified. For investors listening to us now that maybe have stock holdings, or whether they do or they don’t, a lot of people need to be diversified. At least, that’s what we hear when people call us. I think we do a very good job of getting their assets in something that will not be determined by the price of Apple or any other telephone-making company. So often, the NASDAQ moves up and down based on different ideas and how many phones were sold. The beauty behind what we do, I feel, is that coffee, cocoa, and sugar have been around for a long time, and they’ll continue to be. What happens in Washington or what happens in San Francisco doesn’t make any difference, and that’s why I love what we do. Michael: Alright, let’s move over. Speaking of diversification, let’s talk a little bit about soybeans here. Nice thing about soybeans is not only are they not correlated to stocks or equities or anything going on in financials, but they’re also not correlated to anything going on in the markets we just talked about. Commodities tend to march to the beat of their own drum or their individual fundamentals for a while. Even on some of the commentary we read right here at OptionSellers.com, the soybean market has had a very bearish fundamentals. The market has been in a downtrend. As a lot of readers and listeners know, that can be very profitable if you’re a call seller. Certainly that was a market to take advantage of on the downside in the latest USDA report that came out October 12th, the USDA gives their monthly supply/demand report. That was expected to be a very bearish report for soybeans. Ending stocks were at 365 millions bushels. In this USDA report, they raised that to 395 million bushels, which is bearish but not quite as bearish as many had expected. What tends to happen, and James I’m going to pass this to you in just a minute, but talking about seasonal tendencies… when you get into the heart of harvest, which is in October, that’s when soybean supply is typically at its highest because of new supply coming in. Prices, agricultural prices, soybeans in particular, tend to be at their lowest. From that point, traders tend to start focusing on forward sales again. Prices tend to put in a bottom this time of year and then they start to rise. This USDA report might have been an impetus for that. I don’t know if a seasonal low is in but it certainly looks possible right now. Prices are starting to rally. That sets up a situation. Is it overly bullish, James, or what do you see coming up here? James: The October low and the report that just came out are probably going to coincide. We had soybeans trading $10.50, $11.00, $11.50 a bushel, recently. Now we’re in the mid $9.00. I think that does coincide with the harvest. Harvest lows normally are made in the first and second week of October. The report that just came out from the USDA showing ending stocks not quite as bearish as previously thought, that is likely the low in soybeans. We think that, going forward, all of the sudden you’re into December, then you’re into January, then there are worries about planting season. Likely, soybeans will be trading well above $10.00 at the beginning of 2017. So, we are looking at put selling opportunities for that April-May, May-June timeframe for next year. That is when the anxiety hits for planting season in the Midwest and the United States. We’re expecting soybean prices to probably rally 10-15%. If we’re looking at selling puts 20-30% below the market, which we are, that sets up a really nice safety net for the market to either go sideways, go up a little bit, or actually fall like we talk about in our book in all 3 scenarios of selling puts and soybeans. It’s likely going to be profitable over the next 3-4 months. We are looking to do that here in the next week or two. Michael: So, you could sell puts and then if it rallies a bit possibly sell calls, turn it into a strangle. James: The bullishness really isn’t there for soybeans to rally to $12 or $13. We do see the market rallying possibly a dollar from where they are now, especially going into early 2017 as we starting looking at weather conditions and things of that such. Brazil, Argentina, there will be weather problems there, possibly. It seems as though the trade always makes something up and the market does rally, especially after the harvest in the United States. So, we would look for a rally in soybeans early in 2017 and to what we say “leg on a strangle”. We would sell puts now, if the market rallies we would look to sell calls and put a very large window around the price of soybeans. We think that would work probably through the first half of next year. Michael: If you’re a high net worth investor and you’re listening to this and you’re want to learn more about some of these things we’re talking about and how we apply them when we’re investing for high net-worth investors, like yourself, you can go and watch some of these instructional videos we have on our website. If you want to learn, for instance, we’re talking about ending stocks, stocks to usage ratio, two very important figures when you’re doing agricultural analysis, you can watch our video at OptionSellers.com/agriculture. If you want to learn about the strategy of strangles that James just talked about, you can watch that video at OptionSellers.com/strangle. Let’s talk a little bit about the upcoming newsletters. If you’re on our mailing list and you get our newsletter, the November newsletter, which you should be getting sometime on or around November 1st, interesting piece in there. We’re going to talk about 5 ways to survive the next 4 years, regardless of who’s the President. We talked a little bit earlier in this broadcast about not focusing on the next couple of weeks but the next 4 years. We’re going to list 5 things that, as a high net worth investor, you can focus on. We’re going to talk about those things that should help you reap higher returns. As far as our trading strategy in this month’s newsletter, we’re going to get into some specific strategies for some of these softs markets that we talked about earlier. We talked heavily about the fundamentals today. The newsletter is going to give you some specific strategies you can use to potentially profit from that. These are strategies we’re using here. Obviously, if you’re a client, you’re having these done for you. A lot of investors at home, they want to look, they’re trying to learn this. Sometimes they’d like to follow the trades. Some people actually like to take and do one or two of them to get a feel for how it works to see if it’s something they might want to invest in. So, that’s what these are for. Also, going to talk about the two key criteria for judging an alternative investment. There’s some original insights in there that, if you do invest in alternatives, this will be helpful to you. Getting into our trading lesson this month, James, this is a question that comes up often. As far as structuring, building a portfolio to target returns that different investors want to look for. I know that when I’m talking to potential investors on the phone and, certainly, when you’re speaking with new clients we’re setting goals and then we’re putting together a plan to hit those goals through writing option premium. We have one program here, but we have the ability to scale that to a conservative, moderate, or aggressive posture. I think some of our listeners might be interested in hearing how you do that when you’re building out this type of portfolio. Can you talk a little bit about that? James: Certainly. When I speak to a new client, we go over their goals, their objectives, their risk tolerance, and what they’re hoping to achieve over the next 5-10 years investing with us. The question always comes up, “If I’m conservative, do I sell these certain options? If I’m aggressive, I sell closer in options? Or I’m trying to sell premiums that are wider than the possible $600-700 per contract that we normally sell options for.” The answer is quite simple. We are basically selecting the most conservative strike prices with the highest availability of opportunity and decay in those values that we can find. So, we are going to sell options that are 50, 60, 70% out-of-the-money. For a slightly more aggressive client, we sell the exact same options, we’re just utilizing more of their margin money. A slightly conservative client would be positioning their account approximately 40-50%. A moderately traded account, we are positioning slightly higher percent. An aggressive account is a 60% plus. We’re utilizing the same option strikes that we would for a conservative account as well as an aggressive account, and we’re simply throttling their leverage. That can make quite a difference. When we are utilizing the ability to use more leverage and sell a greater deal of premium, on positive years that can make quite a difference. We are looking at trying to produce returns of 15-25%. Conservative account is on the 15% side and the aggressive account would be 25% or greater. Very happy, as you know, Michael, to talk about how we did last year. We beat all of those numbers. We are on track to beat those again this year, whether you’re a conservative or aggressive client. That is how we throttle someone’s leverage, and that is how we understand risk for each client. Before we get started trading, that’s exactly what we talk about and make sure that everyone’s on board with exactly what we’re trying to accomplish and the risks that are involved. Michael: James, I want to throw in a disclaimer here. I’ll be the compliance guy … there’s risk involved and you can always have loss in any type of investing, including this one. Although we’re not making guarantees, these are the type of targets we go. Based on our past, we feel these are realistic targets. One of the questions we get often when we’re talking about the differences to these conservative, moderate, and aggressive stances. One program, we scale it up and down only through the use of margins. Some investors might think, “well, aggressive you use different strategies. You might write different types of options for that than you do a conservative. You might manage risks differently.” What we tell them is what you were just saying – that’s not the case. We manage risk the same across the board. The only difference there is really how much margin you’re keeping as backup and your position size. So, an aggressive account would have slightly more positions on than a conservative, but they’re going to be the same positions. Is that correct? James: That’s exactly right. It’s very easily done. We are selling the exact same options, the exact same strike prices, for all of our accounts. We simply tailor the leverage to what a client and their goals are. It’s very easily done, but we do have a long discussion before someone does start investing with us. That’s exactly how it’s done, Michael. Michael: James, one final point to make here. I know a lot of listeners out there, if you’re listening to this, a lot of index option traders. Whether you’re trading the S&P, a lot of Russell 2000 traders… one thing about this type of portfolio, if you do get into it on your own or through a company like ours, it offers the ability to diversify across a whole sloth of uncorrelated markets. We were just talking earlier about coffee, sugar, cocoa. They’re trading in complete opposite directions. If you’re just trading a Russell, you’re in one market. If you’re in the wrong side of that market and the thing moves against you, you’re not very diversified. The advantage of this type of portfolio is you can diversify over a group of different uncorrelated markets. You’re selling options and many of them, even if 1 or 2 of those markets goes the wrong way, you still have 4, 5, 6 that are working in your favor. Is that what you’ve found, James? James: Michael, it’s interesting. You know what our portfolios look like, our clients know what our portfolios look like. We’ll have a strangle around gold that we’re short from 2,000 and long from 1,000. We are bullish crude oil for the summer driving months, we’re bearish for the winter months. We follow seasonalities for cocoa, coffee, sugar, and orange juice. We watch seasonal fundamentals to trade soybeans. We follow the silver market extremely closely. The ability to diversify inside a portfolio like this, I know I’m kind of beating the drum on it, but I know so many investors right now are listening to the Carl Icahn’s of the world right now and saying, “The stock market might not be the place to be over the next 5-10 years.” Nobody knows that. Not even Carl, he doesn’t know it either, but when you hear people talk like that there is no diversification. If the stock market falls, it doesn’t matter really what stock you’re in. The fact that we have the ability to be neutral on different commodities and at the same time be bullish and bearish another basket of commodities, it truly does diversify you. Of course, we don’t have anyone have 100% of their portfolio with us, certainly it’s a smaller than that. The ability to, as we state on the front cover of our book, “Possible good returns in bull and bear markets”, and that’s what a lot of people are excited about right now as the stock market might be at an inflection point. I know I’m not a big cheerleader for shows like Bloomberg, or CNBC, or what have you because they have so many different people coming on, but you talk to these billionaires that they are interviewing and they are certainly waving a couple flags when it comes to stock market for the next several years. So, we’ll see what happens. Maybe being in commodities is not for everybody. Everything we do we are not right all the time; however, being in another asset class certainly is looking more interesting to a lot of our listeners and, certainly, our clients. Michael: James, that’s a great point to bring up just in closing here. When we were writing our newsletter and putting stats together, we pulled a stat from Barron’s a couple weeks ago. I might have to put a disclaimer on the end of our podcast here just to document where I got it and who said it, but out of Barron’s looking for a, I believe, 1.4% annualized return in the S&P over the next 10 years. That’s after inflation. Even if the thing doesn’t roll over, that’s not the type of investment I’d be looking to put money in, but take that for what it’s worth. I’ll get the stats from where it comes from. James: Michael, I’m a big Barron’s reader and I missed that stat, I missed that article. That is almost jaw dropping. Can you imagine being invested like that and that is your goal? We’ll see! To each their own. Investing is personal. When people say, “How much should I invest? How much should I do?” Investing is personal. Those are definitely interesting stats that Barron’s and the people that they were talking to are looking out at the next 10 years. I think mattress sales are going to go up quite well, as in “Put you money under mattresses”. That’s an interesting stat. Michael: Well, we’ve had an interesting talk this month. For those of you inquiring about new accounts, unfortunately we have none available until after thanksgiving right now; however, Rosie still has a few consultations available in November. If you’re interested in booking a pre-account interview consultation, you can call Rosemary at 800-346-1949. You can also request online at Office@OptionSellers.com. James, thanks for your great answers this month and information for our listeners. James: Michael, it has been my pleasure. I love doing this show and educating people who think outside the box, like our listeners, is just so entertaining and so much fun for me. Looking forward to doing so again for the next several months. Michael: Of course, anyone listening, if you’d like to learn more about our company and our program, you can go to OptionSellers.com. There’s a wealth of information there. Have a great month of option selling, everyone. We will talk to you at the end of November.

OptionSellers.com
The 2 BIG Markets To Take Premium From Now

OptionSellers.com

Play Episode Listen Later Nov 23, 2016 28:40


Welcome to Option Seller Radio, the podcast for high net-worth option writers. Here, you’ll learn option selling strategies you can use right now in diversified commodities markets, such as crude oil, gold, coffee, and soybeans. So, listen in and start putting decades of knowledge from the OptionSellers.com team to work for you. To learn more about OptionSellers.com, and their managed portfolios for high net-worth investors, visit www.optionsellers.com. Michael: Hello everyone, this is Michael Gross at OptionSellers.com here with your November issue of OptionSellers.com podcast. This is a special Thanksgiving edition and, boy, the world has turned upside down since our last radio show. The title of this month’s show is Trump, the Fed, and 2 BIG Markets for Taking Premium Now. I’m here with James Cordier, head trader here at OptionSellers.com. James, welcome to this month’s radio show. James: Thank you, Michael. It’s always a pleasure and, boy, have things changed since we met last. Michael: Well, if you’re listening to this before or after you’ve had your turkey-day, we hope to bring you some good insights here for selling options and understanding the commodities markets over the next 30 days. As we all know, on November 8th Donald Trump won the presidency and that has certainly presented a list of pitfalls and opportunities for the markets. We’re going to touch on some of those today. Also, have big Fed announcement coming up in December that will have a big impact on the markets, and we are going to discuss those today. James, why don’t we start out by just you giving your general comments on the election, what you think this means for commodities markets. James: What’s interesting, Michael, the pollsters both in England for the Brexit and here in the United States for the presidential election really did not get it. They weren’t even close. Hillary Clinton had a 5% lead going into election night and we all know what happened there. So interesting was the initial response to Donald Trump apparently winning the election. First thing was to sell stocks with both hands and buy gold, with the idea that is just so much uncertainty and how can this gentleman out of nowhere come in and run the greatest and largest economy in the world and, lo and behold, everyone said, “You know, maybe he can. He’s a great businessman, he has been very successful, and he doesn’t mind borrowing money and building things.” Certainly, that’s something that could definitely propel the U.S. economy to levels that it hasn’t seen in quite some time. I think, personally, that both the economy and inflation, something we haven’t had grow at any marketable levels in a long time, is going to really open some eyeballs here the next 12-24 months. Michael: We also have the other big news on the horizon here is the Fed is expected to raise interest rates in December. That could also bring some changes to the market, potential opportunities. Do you have any thoughts on that at this point? James: Michael, the topic of discussion, I think, going forward will be U.S. growth no longer at 1%, no longer at 1.5%. We think it’s going to have a crooked number for years to come, in other words, 2%, 3%, and 4% growth. What the Federal Reserve does in order to rein in potential inflation, I think, is going to be headlines constantly with the Federal Reserve talking about raising interest rates to fight inflation, but, lo and behold, I think that’s something that the Federal Reserve has just been waiting so long for and I think we’ll, behind closed doors, do everything they can just to stoke it a little bit and let it run hot. Michael: James, that’s a point you’ve been making in a lot of our articles recently, and recently, also on CNBC here this past Friday, you had a pretty informative interview on the gold market. Your big theme and our big theme here at OptionSellers.com is that we see inflation picking up in 2017 for a variety of reasons, which you, by the way, did outline very well in our gold piece earlier this month. It is on the blog. As far as your outlook on gold, you had a pretty good interview here Friday where I thought you made your case on CNBC. What do you see happening there over the next 90-120 days? How do option sellers who are looking at that possibly take advantage of that? James: Well, Michael, with what could be a stronger economy in the United States, what will likely be slightly higher interest rates, of course, we’re going to have ¼ point rise here in December – that’s already said and done, it’s like a 99% chance of a rate rise in December. This is what’s been pressuring the gold and silver market here the last 2-3 weeks, was the idea of higher U.S. interest rates. Initially, that is causing a very strong U.S. dollar and when the dollar is strong a lot of investors will dump their gold holdings in order to get possibly into securities. The timing on that is going to be really interesting. When will investors start looking at a slightly higher interest rate with the idea that that’s not going to slow inflation? The timing on this is going to be a little bit tricky this year. Whether inflation starts coming back and the Federal Reserve does little to stop it, that might not be determined until January or February of 2017, but what will get put in place and I think what will be released coming up very soon is the idea of a much stronger U.S. economy, 2.5-3%, and I a lot of people on the inside are going to think the Federal Reserve is not going to stand in the way of letting it run hot. That will be the ignition for gold and silver to start rallying next year is that January, February, we’re not sure, but going forward right now put premium is ginormous for June, October, December of next year. We are really wringing our hands right now with exactly how to position going forward. Gold puts are extremely overpriced and we really like what we see for getting bullish on gold for next year. Michael: You had some great points and you bring up a good point about the put premium- it’s higher. There are a lot of people bearish right now on gold and, from my perspective, your perspective probably as well, it’s hard to see what they’re looking at. If you do see a growing economy next year, Wall Street Journal had a recent survey showing GDP is expected to jump to 2.2% next year, possibly higher in 2018. They’re looking at inflation jumping 2.2% in 2017, 2.4% in 2018, which may not sound like a lot but, considering it may end up this year about 1.8%, that’s fairly significant as far as the ripple effect it can have. I think you made that case pretty well. As far as people looking at gold and saying, “Should I buy the thing here? Is it underpriced”, what are some of these bears looking at? Why are they bearish gold right now? Why this big premium in the puts? James: Michael, all anyone can see right now is a strong U.S. dollar. I think the dollar this past week hit a 13-year high. There is much less uncertainty about health of banking and the banking system around the world right now. Over the last 24 months, there was Greece, Italy, and the Brexit and it was negative interest rates in Germany and just certainly things in the market that no one has considered before, so a lot of investors had the idea that, “maybe I should own some gold” with a brighter picture for the U.S. economy and other economies around the world right now. People feel less need to own gold right now. It hasn’t been a hedge against inflation for several years, and that, I think, is the canary in the coal mine where for the first time, I think, in 2017 we will finally be hedging against inflation – something we haven’t seen in practically a decade. People are selling gold right now because of a stronger U.S. dollar, inflation has not been a worry for several years, and that is what we think is about to change and why someone should look at selling puts and going long on gold. Michael: Of course, put selling strategy where you don’t really have to pick the bottom, you simply go far underneath the market, that’s a little bit of confusion that mainstream investors don’t get. I think, for instance, to go back to your CNBC interview, James, you’re talking about bullish influence for gold in 2017 and one of the commentators there, I believe it was Evan Newmark, was just an all-out bear. Didn’t like gold at all, told a story about how he bought gold index and it went down and he lost 80% and that the market’s no good. Just to dismiss it like that, he has probably never heard of selling options. When people think, “We think gold’s at a value, you should buy gold here”- we’re not necessarily saying that. We’re saying it’s at a level where you can go far underneath it, collect put premium, the longer-term fundamentals support price, and you can really afford to just wait it out and wait for prices to go up. That’s the whole concept of selling options. It’s the same approach you’re taking in the portfolios now, is that correct, James? James: It is, Michael. So often, its herd mentality that drives prices too high and too low. When gold is rallying, everyone seems to be jumping on board. You have gold bugs coming out of the woodwork, buying gold coins and buying bars that you see on TV all the time. Basically, all we’re doing right now is saying that the value of gold right now is at fair value. That’s without any inflation. The gold market is down from $1,900 all the way down to $1,200 now. We really see extremely strong values selling puts at $9.50 and $9.25 for several months out in 2017. We don’t have a crystal ball, we don’t know when the gold market’s about to start rallying on any given day; however, if we do have strong growth in 2017, if we still have a relative easy fed, the gold market is going to look extremely strong as inflation numbers start coming out. Does gold bottom right here at $1,210? We’re not exactly sure, but would we go long by selling strikes at $9.50 and $9.25? We absolutely would. We think that in the 2nd and 3rd quarter of next year, gold will likely be $50-$100 higher than where it is right now. Certainly, that would put these gold options that we’re referring to $300-$350 below the market at that level. Of course, the premiums would be basically cut into maybe 90% from where the current position from where they are right now. We think the timing’s pretty good on it. When does gold start rallying? We’re not exactly sure, but the premiums are extremely large right now because of the down drafts since after the election. Michael: All right, and of course the title of this podcast is 2 Big Markets. A lot of times we’re talking about, well, last month we talked about soft markets, markets like coffee, cocoa, or we’ll talk about grain market. When you talk about major markets, for instance, like gold and silver where there’s a lot of liquidity, there’s just tons and tons of open interest there, open contracts, a lot of participation there. This is where you can really get creative with a lot of your option selling, and we’re going to talk about second big market today, which is one of our favorites. James, I know it’s one of your seasonal favorites… the crude oil market. This is a big time of year for crude oil. Would you maybe want to explain to our listeners why that’s the case? James: Crude oil certainly is one of the largest commodities traded worldwide. Energy prices seem to do quite well in the western hemisphere in June and July, as driving season and demand is as its greatest and often a time when supplies are at their least. Going into the 4th quarter of each year, we have something called shoulder season where we’re no longer heating homes in the northeast and we’re certainly not driving as far as long vacations. This is truly the smallest demand season of the year going into December and January. This year, we’ve had oil trading around $40-$45 recently, we have some discussion from OPEC that they’re going to try and reduce production, but each year we want to go long crude oil in December and January for the June and July time frame. That appears to be setting up quite well. Demand is at its least in December and at its most in June. December is when you would sell puts below the June contract with the upcoming driving season. Normally, you can sell puts $15-$20 below the current value in December and January, and you normally see a $10-$15 rise into driving season. Once again, our favorite seasonal play in all of commodities is possibly taking place in the next 30 days going long crude oil for next spring and summer’s driving season. Michael: Very detailed piece included in the upcoming December newsletter on crude oil that really talks about the seasonal and flushes it out, gives you some background info to trade this writing premium on it, how to get the biggest premium out of this market. James, you make this point well… as far as the seasonal for people listening that may not be familiar with what seasonal tendencies are, seasonal tendencies and commodities are the tendency, not the guarantee, but the tendency that prices tend to move a different direction at a certain time of year. Crude oil, for instance, as refineries start ramping up gasoline production to meet summer driving needs, they start doing it in December and January, and that’s when they start using more crude oil. Demand at the wholesale level rises. That is often coincided with the corresponding rise in price. So, these are the type of things that we look at while we’re analyzing a commodity that they don’t talk about on the news. They want to talk about what’s in the headlines but they don’t talk about these kind of invisible hands that are really pushing supply and demand. When you’re looking at commodities, that’s the kind of thing we look at here- the real underlying forces that are moving price, not necessarily what’s in the headline. James, that lead up to driving season, it appears, from looking at a seasonal chart, that that strength lasts all the way into May or June. Is that how you’ve tended to play it? James: That is how we see it, Michael. Here in Florida, and we probably have similar prices across the nation right now, we’ve seen gasoline prices dip below $2.00. Once again, you’re looking at gasoline at $1.90-$1.95 per gallon. Next May, June, and July you’re going to see gasoline around $2.50, $2.60, $2.70. I know that sounds like really making a simplistic argument to going long crude oil in December for the June and July timeframe, but it is as simple as that. The idea that prices are near their low around the holidays because demand is at its least. It’s not your imagination. Michael: As we discussed before, that is the feature piece in your December newsletter. You’ll see the seasonal chart we talked about. Also, one final thing to bring up about seasonals that we are going to talk about in this piece is these seasonal price moves, while they’re not guaranteed, past performance is not indicative of future results, of course, they tend to occur regardless of where the absolute supply of the commodity is… or the demand or the absolute price. They tend to operate independently of that. For instance, this year, gasoline stocks tend to dwindle. They hit a high in the spring and they tend to just fall off right into December. Even though gasoline stocks are higher than they typically are this year, they have followed that exact pattern straight down. This time of year they start to build them again. We have no reason to believe they won’t start building them again this year, and that’s typically what can cause that seasonal move. Going onto the December newsletter for those of you expecting it, you should look for that around December 1st or 2nd if you are on our newsletter mailing list. In addition to the feature oil piece, James, we put together a great piece this month called How to Make Your Portfolio Great Again. Obviously, a little play on the election there, but some really good pieces of advice in there you gave, especially for the upcoming year. I think anyone that’s interested in building a portfolio will gain something from that. Also, you’ll find a nice piece in this month’s letter about using premium ladders, something we haven’t talked a whole lot about on the show, and something we probably should. It is included in the book, The Complete Guide to Option Selling. It really gives you a blueprint for building a consistent income stream, if that’s what you’re looking to get out of this type of investing. James, lets move on to our trading lesson of the month now. We’re going to talk about a strategy that I know is one of your personal favorites. It’s one that we employ often in our portfolios. It’s the strategy of writing covered options. A lot of people that trade stocks think that means owning the stock and selling the option, but that’s not necessarily how you approach it. Lets talk a little bit about writing covered options and commodities and how you like to go about doing that. James: Michael, during times of low volatility, we don’t always have the luxury of doing a credit-ratio spread, in other words, a one-by-three, which is outlined in The Complete Guide to Option Selling chapter 10. Basically, what we’re doing during times of high volatility, something we just received now after the election, is the luxury of selling a ratio spread. In other words, for example, using our crude oil scenario…. We’re looking to sell the $30 crude oil puts. In order to babysit that position while we’re holding onto it we would buy 1 possibly $33 put. So, in other words, what we’re doing is we’re taking in a great deal of money selling the puts and we’re going to buy 1 contract to protect it while we’re holding it for 30-60 days to make sure that trade is exactly the way we though it would be. What it basically does is it controls the risk on your position and as you no longer need the insurance of buying that option, we can sell it off. In other words, we are taking in anywhere from $600-$700 per contract on our short puts. We’ll spend a little bit of money to hold that position as far as insurance using a long put option. It is basically, in our opinion, the very best way to take in premiums selling options and having a controlled risk parameter while you’re doing it. Michael: James, a lot of people when we talk about volatility and increasing volatility, mainstream investors that don’t sell options tend to run from volatility and they think, “Oh, I better get out of the market.” What they don’t understand and what option sellers do understand is that can be the time to really make hay as an option seller because it opens up these types of strategies. When volatility increases, that makes the premiums bigger. That means you can actually put on spreads like this and you can actually get a higher probability trade that goes a long way toward smoothing out the equity curve. You can get in a not only higher quality trade, but sometimes a, for lack of a better word, safer trade than you would otherwise. Would you agree with that statement? James: You know, volatility is certainly the low-hanging fruit for what we do. Any time we have the luxury of selling puts or calls 50-60% out-of-the-money in an area that we’re able to buy a long option to protect that position for just a short period of time, that is just the most low-hanging fruit landscape that we can ask for and we just received that since the election. Michael: If you’re listening to this discussion, and James and I have had this conversation in private over the last couple of weeks in regard to spreading the markets, and it has been a little bit more difficult to do in 2016. We’ve gone more to writing naked, which is certainly a viable strategy, certainly a good strategy to take premium out of the market, but when you can spread the markets when you get this type of volatility like we just got it opens up a whole new ball game for selling premium. We think that’s open now, we do think 2017 is going to be a much friendlier year to spreading options and certainly looking forward to that. James, I think one final point to make on this topic is you and I both know we get a lot of feedback from people that read our newsletter, maybe see us on TV, where we’ll write an article about something and recommend a possible trade – here’s a way you can take advantage of this – and there’s people out there that aren’t our clients that look at that and may take the trade. They go trade it themselves, and there’s certainly nothing wrong with that, but a lot of those people might not understand is that when we’re trading these markets we are trading them as part of an overall portfolio, as part of an overall strategy and not trading them in a vacuum, like I think some people take and trade on their own. So, when you put a portfolio together, you may be using a combination of different strategies, different strikes, different months, all designed to balance each other. I think that’s one thing that people just take a trade here and there don’t really understand. Would you agree with that? James: A balanced portfolio is certainly the key to success for any portfolio, whether it’s in stocks, or whether it’s real estate, or whether it’s selling options and commodities. We simply will have a blended cocktail almost, if you will, of our favorite positions that we see. Sometimes, it is a naked short position in coffee, sometimes it’s going long crude oil for the driving season, other times we see extremely large premiums on both the put and call side and in that case we would strangle the market. So, we utilize probably 4 or 5 different strategies and approaches to selling options on commodities and using a blending of all 4 or 5 is usually what a portfolio looks like. I know that’s what is going to be achieved here in the last part of 2016 and the beginning of 2017. Right now, premiums are extremely large and it gives us the ability to blend, what we think, is a very balanced portfolio using different strategies in applying short options. We’re really excited about 2017 and making exactly portfolios look just like that. Michael: All right, well I think that’s a pretty good analysis of spreading options and the strategy of the ratio-credit spread. As James mentioned, if you want to read more about that we have a whole chapter about it in our book, The Complete Guide to Option Selling: Third Edition. In closing, just a few announcements. As you may know or find out here in the newsletter, we unfortunately have no new accounts left available during 2016. All of our accounts are booked. The good news is, if you’re hoping to take advantage of some of these strategies we talked about in the gold or crude oil market, these should spill into January time frame. Would you agree with that, James? James: Especially what’s happening right now in gold and silver, it looks like an opportunity that even our listeners can take advantage of in January. Of course, if the oil market stays relatively low going into the new year, that is something we would certainly encourage our listeners to take advantage of. We only trade energies twice a year and one of those two times is coming up in the next 30 days. I would definitely encourage people to take a look at that. Michael: So, if you hear this and you say, “Aw, well I can’t really open the account” these things aren’t here and then they’re gone. They’re opportunities that could probably be available in January. We do have a few openings left in January if you’re looking to possibly have an account then. Consultations for those openings are still being scheduled in December. If you are interested in reserving one of those consultations, they will be taking place before the 15th of the month in December. So, if you’re interested in one of those, give Rosemary a call at our main number… 800-346-1949 to reserve one of those remaining openings. We wish everybody here a very happy Thanksgiving and, James, thanks for your insights this month. James: My pleasure, Michael. I hope everyone listening has a happy Thanksgiving. Very interesting times we’re going into. Sometimes, people feel that it’s a slow portion to the season coming up, but actually we find it quite exciting as investors are taking advantage of options and we’re going to take the other side. Michael: We will be back with you for a special New Years edition of the Option Seller Radio Show. Until then, everybody have a happy Thanksgiving, happy holidays, and a great month of option selling. To learn more about OptionSellers.com and their managed portfolios for high net-worth investors, visit www.optionsellers.com.

OptionSellers.com
The 3 "Must Know" Seasonal Tendencies for September Option Sellers

OptionSellers.com

Play Episode Listen Later Aug 25, 2016 30:57


Michael: Hello, everybody. This is Michael Gross from OptionSellers.com, here with your August Option Seller Radio Show. I’m here with founder and head trader James Cordier and we’re going to talk a little bit about the markets here and things going on as we start September, back to school month, or, for a lot of investors and financial professionals, it’s back to work month. A lot of people go on vacation in August and when we get back in September it’s back to business. A lot of people start focusing on some of the stories they may have overlooked over the last month or two. James, welcome to the show – a lot to talk about this month. James: Thank you, Michael, there certainly is. Both markets moving, instruments happening, as well as the stock market, of course, the Federal Reserve is always interesting, and new highs in the stock market. We were talking recently about a couple articles that have some of the largest, most well known investors in the world saying that not only is the stock market going to pause but go into a bear market, then it continues to rally. Its just really interesting times right now with both the Federal Reserve and what a lot of people are considering with the stock market what it might do over the next year or so. Michael: You know, we’re going to talk about oil here in a little bit, but some of the stories coming out of OPEC talking maybe about a production freeze, and some people think maybe that’s helping the stock market, too, a little bump in oil here. James: It really is. This is so interesting how the oil market, especially, is a great example of a market that has extremely soft fundamentals. In the United States, we have all-time record supplies. We have Iran and Iraq and Saudi Arabia who are going to just duke it out for market share starting in October and November. What is OPEC come up with going into the soft demand season? Well, we are going to talk. We’re going to come up with some ideas and we’re going to try and freeze production. The part that is so interesting about freezing production, as we all know, is that productions are at record highs right now, so the market really is trying to grasp onto anything it can to try and get insight on what the market might make the next move. What’s so interesting is, as all OPEC discussions over the last few years, each country needs a specific amount of money to run their economy and if oil goes down to 40 or 38, they’re going to need to pump that much oil and everyone really knows it. This buying the market because of OPEC discussions coming up, that’s going to be a feudal end. I’ve seen it before the last several years and when the market rallies up because Iran is now going to join into the talks, they know that all they’re doing is jawboning. When push comes to shove and demand is low in winter, they’re going to be pumping oil like never before. Michael: Yeah, that’s a great point and we are going to talk about that in a second, too, because we have a big seasonal coming up in crude. I know you’re eager to point it out as well. September, as we discussed earlier, is a big month for seasonal tendencies. If you’re listening and you’re unfamiliar with seasonal tendencies, these are the type of things that happen at different times of the year - fundamentals in these underlying markets that can have an outside impact on price. So, being aware of what the seasonals are can really have an impact on your trading, really give you some direction when you’re starting to identify trading opportunities. It’s certainly where James and I start when we’re looking at markets and being aware of that underlying seasonal. September is a huge month for seasonals and one of those markets, in particular, is one of your specialties, James. That is the coffee market. As we end the Brazilian growing season here, we are at the end of harvest, some certain things happen when that harvest is done. Do you want to talk about that a little bit, James? James: Well, what’s interesting is a lot of investors were pointing to whether that wasn’t exactly perfect in many growing areas of the world for cocoa or sugar or coffee. But, in Brazil, we have a record harvest that just took place for Arabica beans. Those are the sought after variety that we drink here in the United States and through most of the western world. We have a record supply coming in. Harvest right now is about 95% complete and you’re going to see co-ops in Brazil wanting to turn those beans into cash. They’re going to try and hold back and they are going to make all kinds of discussion about how we’re going to have a retention plan and we’re going to wait for higher prices, but the bottom line is that they only have so much room for that coffee and it has got to go. As they say, bills have to be paid. If you’re in a third-world nation like Brazil and your cash crop is coffee, you need to turn that into the market. We expect those supplies to start hitting market channels in September and October as the harvest wraps up. Lo and behold, the United States, the largest consumer of coffee, we are currently sitting on the highest coffee supplies of green coffee stocks in the United States for the last 13 years. We don’t really need to bid up coffee prices to get the beans to get here. Coffee roasters can be very picky because we’re sitting on so much coffee here in the United States. With Brazil trying to find a home for their coffee, the United States has all the coffee they need. This seasonal for a downward move in java prices looks quite certain for September, October, and November, so we will be looking at selling coffee calls with both hands here in the next 30 days. Michael: James, that’s a great point. You’re talking about records Arabica production. Total crop out of Brazil, the latest estimate I saw, correct me if I’m wrong, but I believe they’re looking around 56 million bags, which isn’t a record but it is near a record. What you brought up, and maybe just a way of restating it to help some of our investors listening grasp it, is as these supplies hit the market, that excess supply is Economics 101. As supplies go up, price tends to come down. What tends to happen in the fall, if you look at a seasonal chart for December coffee, you hit the first of September and prices typically start declining. That doesn’t mean it is going to happen every year, but over the years that tends to be the cycle. It is something that we are expecting this year. An investor listening to this, you know, it sounds probably Chinese to somebody who just traded stocks and doesn’t know a lot about commodities… you’re talking about how we’re going to be selling options with both fists. How does an investor sitting at home grasp that? How does he take advantage of this? He sees coffee prices where it is right now and he’s looking at a chart. Maybe just kind of walk them through what he would do. James: Certainly. For anyone listening to our commentary today who have read our books on The Complete Guide to Option Selling and have read chapters that concern, for example, historic volatility, namely in the coffee market, years and years ago we had a large rally in the coffee prices because of a freeze that took place in southern Brazil, which caused coffee prices to jump dramatically. In southern Brazil, coffee plantations have migrated north. The chances of freezes that have caused prices to go up in the past are negligible. They no longer exist. However, the historic volatility that is still in coffee options will still be there and it does exist. We actually have the ability to go short coffee at double the price of its current level. In other words, we have a seasonal factor that should cause prices to go down in October, November, and December. The strikes and the coffee calls that we will be selling for clients, or someone listening to us today can do it themself, you are looking at selling coffee calls double the current price. As you mentioned a moment ago, will coffee prices slide 10 or 20 cents a pound this fall? It is really not that important. What we are positioning ourselves and our clients to do, is that we are wagering the fact that coffee won’t double during this price. Historic volatility gives us the ability to sell coffee calls at a very high price and at strikes that are almost double the current price. Michael: Yeah, coffee currently trading just above $1.50 per pound in that range. Good explanation there, James, of why you’re able to sell so deep out-of-the-money. I think that’s a big question a lot of investors have, is why can you sell so far our in commodities and not in stocks. A lot of it has to do with the leverage and the way commodities are priced, but it also has to do with fundamentals that may have changed over the years but that volatility is still in the market. Great, great example there. Selling calls into a harvest in a lot of markets can be a good strategy to pursue. That’s going to take us into another market that we are watching here in September. The grain markets are all big markets that have seasonals in the fall. In the United States, we harvest soybeans, corn, and wheat in the fall. As those supplies come in from harvest, historically speaking, that has tended to pressure prices because as that supply builds, it’s going back to that Economics 101. Higher supply tends to pressure price. That tends to happen in the fall as the new harvest comes in. Not always, nothing is guaranteed, but historical tendencies, however, have tended to drift that way. James, soybeans are another market we’ve been watching lately, we’ve already had kind of a drop-off there, but heading into a harvest now, talk a little bit about the crop there and what you see happening. James: Well, in corn and soybeans in the United States, it seems as though farming just continues to get more and more improved. Not only is Brazil able to produce more coffee beans, but here in the United States and places like Argentina and Brazil, growing more soybeans on the same number of acres here in the United States. We are looking at a huge crop in soybeans and corn that the Unites States is going to be harvesting starting in September and October. Once again, as you mentioned, too much supply and not enough demand certainly sets up ideas for shorter prices and going into this fall. Any rallies that we would have in corn and soybeans over the next 30 days, we would certainly be very interesting in selling call options on those, as well. I know that there is a lot to be made about something that’s called stocks to usage, which actually compiles how much demand there is worldwide versus how much supply there is. I know next year, Michael, you might want to refer to this a little bit, but from what I’ve been hearing, next year’s supply versus demand is going to be gigantic. Selling calls in that environment, I think, is a great addition to someone’s portfolio, as well. Michael: Yeah, you know, we talked about that this spring. We were looking at pretty big acreage this year. We did get a pretty big rally in June because we had some weather concerns, but once that crop was made, prices, especially corn, the corn prices just fell off the cliff since June. One of the reasons we are talking about soybeans right now is that they’ve fallen, but not quite as far as corn. The seasonal tends to kick in at the beginning of September, so we have some pretty good timing. In talking about the soybean crop, we are looking at the largest U.S. harvest ever. We are looking at a projected yield or crop size of 4.1 billion bushels. That’s an all-time high. If this comes to pass, our 2016-2017 U.S. soybean ending stocks are going to be at 330 million bushels, stocks to usage at 8.2%. Both of those will be the highest in a decade. When we talk about bearish fundamentals, that’s bearish fundamentals. That is a pretty big weight on the market. It doesn’t mean that market can’t rally, as you always talk about, but it certainly hinders rallies and certainly casts a bearish shadow, often a great setup for call sellers. It’s one of the reasons we’re watching beans right now – looking for those types of opportunities. James: Well, it’s interesting Michael, something that you and I referred to quite often – we may not know where the price of soybeans is going to go next week or two weeks later, but what we’re calculating and what we’re betting on is where it’s not going to go. That’s all we have to do is get that part right. Michael: Exactly. That is a good segway to talk about the crude market here. You started off talking about crude. You got a lot of media coverage lately… a couple of appearances on CNBC, you’ve had a lot of calls from the media on your call on crude oil because back at the beginning of summer everyone was bullish, you were bearish – you’re still bearish, and you’re still looking at that as a great option selling opportunity. So, maybe share with some of our listeners what you see setting up there and why you like it so much. James: Anyone listening to this right now who is thinking the idea that crude oil is going to continue rallying because of OPEC discussion or slightly smaller production here in the United States, I think you would be really well served to do a little research and find out how much supply is actually out there. In the United States we have record supplies. We have cars that now get 40 miles to the gallon instead of 20 miles to the gallon. We have Iraq, Iran, and Saudi Arabia that are producing record amounts of oil all at a time when we’re going into the weakest demand season of the year. September, October, and November, demand in the United States, the largest consumer, it falls off the table. We really like the idea of crude oil prices heading to softer levels, possibly in the 30’s and then bottoming out around November and December. This is one of the greatest seasonal plays there is, is being short oil going into late summer and early fall. Lo and behold, when the holidays come around, we get into December, we’re going to have some very low oil prices, at least that’s the way it looks from my desk. Then, the other seasonal kicks in and that is to go long when everyone is so fearful that the market is going to go down. So, we have two of our greatest plays as far as building a core position in crude oil, that come up now and then come up again in the 4th quarter of the year. It’s certainly something that has been a great addition to our portfolios over the last several years and we think it’s going to be again this coming year. Michael: James, you bring up a great point there on supply. When you’re talking about crude supplies here in the United States, the last report we are at 521 million barrels. That’s an all-time record for this time of year, as you said. 37% higher than the 5-year average for this same time of year. A key point here, it’s 14% higher than last year at this time. As you know, last year, we saw crude prices dip below 30 down into the high 20’s. We are headed into a seasonal time of year now with supplies 14% above where they were last year and if anybody listening to James talk about the seasonal tendency, you’ll be able to see a chart of that seasonal tendency in the September newsletter. It should be in your mailbox next week by the 1st of the month. You’ll see a crude oil seasonal chart there. I want you to take a look closer at what tends to happen to crude prices at the beginning of September. James hit on it pretty good there – this is why we look to build positions in markets like this that have strong fundamentals that don’t tend to change quickly. They tend to take a while to change why you build things called a core position, James, and I think a lot of our listeners might be interested to hear what that is. You talk about something like a core position and building a portfolio. That’s not something that people read about in books. That’s something that often comes from experience. Do you want to share that with some of our listeners? James: Michael, it is interesting because, for those of us that watch CNBC, Bloomberg, and Fox, you would think that there’s a bull market and a bear market in these different commodities and different stocks every 30 days, but there really isn’t. When the market moves 2 or 3% it gets so much fanfare if it’s going up and it gets so much depressed looks on TV if it’s going down. The options that we sell when we are building core positions, as we like to refer to them, they are 50 and 75% out-of-the-money when we sell calls and puts on these positions. So, when gold or silver or crude oil, in this instance, moves 2 or 3%, it gets so much fanfare. With the OPEC talks recently, they are going to bring one oil analyst or oil company CEO onto the set daily talking about oil getting to 55-60 this year and 65-70 next year based on nothing. You mentioned a really important point, and this is something we discuss often when we’re building core positions, crude oil supplies in the United States is 14% greater than last year. Last year’s low in oil was $27 a barrel. Fundamentals is the key to price projections in commodities. We like to project out 6-12 months and that is what we talk about when building a core position. The fundamentals in a market that is over-supplied won’t change in 30 days or 60 days or 90 days, so what we will do is when we get out of the high-demand season, which ends in May and June, we will sell calls for several months out. As we get into December and January, which is normally the low price-point for crude oil, we will then sell puts 6-12 months out based on the idea that the market will then bottom. Core positioning is basically the meat and potatoes of someone’s portfolio. I know we are not into the holidays yet, but commodities like gold and oil and coffee, these are core-building positions because the fundamentals don’t change and they have huge volatilities from the past. What we then like to blend in with them, it’s almost like Thanksgiving meal. You have the meat and potatoes, which will be things like gold and oil, and the cranberries, the gravy, and the dressing will be soybeans and cocoa and sugar. It’s interesting. Being diversified like that gives a portfolio a lot of staying power and the ability to withstand small movements in the market. So many people, Michael, as you know, look at commodities as a highly speculative, incredible form of gambling, and that may be true for investors who are trying to time the market. As we discussed earlier, we are building core positions at levels that the market cannot reach or very likely will not reach. Like options do, they expire worthless some 80% of the time, building core positions that last the entire year. Basically, that’s hitting singles for 12 months. Michael: Yeah, you talk about that quite a bit in the upcoming newsletter – that concept is a recipe for building a portfolio, structuring a portfolio, and if you’re listening and interested in that type of concept, you’ll get a pretty good dose of it in the September newsletter. While we’re on that subject, I wanted to mention that some of these markets we talked about today, such as the seasonal tendencies and soybeans, seasonal tendencies and coffee. If you missed those articles they are on our blog. You can go back and see those seasonal charts and see how some of these prices tend to perform different times of the year. If you’ve never traded commodities before, it’s a real eye opener to try and get a feel for maybe what some consider an invisible hand behind prices and getting kind of a peek at some of the things really affecting price in different commodities. While we’re on the subject of the upcoming newsletter, James, I want to talk about this for our listeners and readers. We have coming up, as I said – you’ll probably get this at the end of next week, we have an article called 3 Reasons to Love Commodities Now and we kind of go into why commodities are such an attractive investment at this point in time. We talk about some of the warning signs we’re seeing for stock prices right now. As you mentioned at the top of the show, a lot of big names getting pretty bearish on stocks, a lot of big investors thinking the prices are getting a little scary now with what’s going on in the world, so they’re looking for alternatives. We really dig into that a little more this month. Something we also have is a crude oil piece that you talked about here briefly, but we outline a little more detail in the newsletter. We also have a guest column this month by former commodity hedge consultant Don Singletary. James, I know we talked about Don and looking for ways to maybe work with him a little more. Don spent 25 years advising a lot of these big commercial hedgers on hedging hundreds, millions, and even billions of dollars worth of product, whether they are harvesting corn or hedging their oil or gasoline. He kind of came to the same conclusion we did as far as option selling – he came at it from a different angle, though. He came at it as he played, pretty much, to these individual investors. It is tough to compete with these pros, but here’s how they did it. He kind of came to the same conclusion we did and he talks a lot about the same philosophies that we do about selling options. Great piece in our newsletter this month - You don’t want to miss it if you have an interest in that. Let’s talk a little bit about our lesson this month, James. I know we talk a lot about fundamentals in this month’s lesson. We want to talk a little bit about technicals because that’s not something we discuss a lot when selling options, but we still use them and I think some of our listeners might be interested to hear how you use them when you are looking for a trade. James: You know, Michael, when we have very discernable bearish fundamentals, we are watching for a market to rally and reach over-bought conditions. Watching technical indicators, like Stochastic Bollinger Bands and RSI, basically that’s going to help us with timing. It is certainly not necessary, but when we see the oil market rally on short covering, for example, if you were to look at open interest in crude oil you can see that this entire rally was based on investors that were short and were forced to cover. That is an extremely important tool to have in your toolbox is watching open interest in a market that’s trending against its fundamentals. You can almost see by watching open interest when the market is rallying against its fundamentals or its falling against its bullish fundamentals, you can almost see when the last bear got out of his position. It’s not splitting atoms, it’s nothing that the average investors can’t do for himself, but it’s something to be cognoscente about. When open interest balloons to all-time highs in crude oil on the short side, you know what’s coming. Everyone who wanted to be short is already sold the market and the least amount of bullish factors that hits the market will cause the beginning of a rally. By watching open interest, you can see when the last guy got out of his short position. That just happened in crude oil here over the last few weeks. Watching fundamentals gives you the idea of which position you want to take and sometimes, being very cognoscente of the technicals, it can tell you when to get in. We’re not trying to be market timers, but when technicals and the fundamentals line up that is when we put our tuxedo on and jump in. Michael: You know, that’s a great point you bring up because a lot of people watch technicals and maybe they can time a little blip in the market or time a little turn around in the market for a short term, but the big point you make, and it’s one we make often in a lot of our writing, is that knowing the fundamentals is what tells you if that blip in the market is the start of a change in trend or is it a buying or selling opportunity on a correction. That’s what the importance of the fundamentals is knowing that big fundamental picture. I know that’s something you stress a lot. James: Well, Michael, these 8-10 markets that we often discuss have been my friends for the last couple decades. They have personalities and they have seasonal tendencies. You can tell when they get a lot of hype on TV and you can tell the difference between hype and fact. The more you trade these the more you get used to them. They are kind of like friends you keep in your back pocket, and when they are over-bought or over-sold against the fundamentals that is when you add to your core position and making building portfolios so much fun. Michael: As a trader, James, portfolio manager, I know a lot of people have their technical indicators. Maybe talk a little bit about the top 1 or 2 we like to watch in our office. You and I know what they are, but maybe our listeners would be anxious to hear just out of curiosity what we like to watch. James: As far as technical indicators, Bollinger Bands is one of my favorites. Putting a Bollinger Band calculation on a weekly chart, and it really helps you understand what the exact outer limits on what a market can reach simply on short covering or news item or headlines that often push the market because that generates computer buying and computer selling. I would suggest to anyone listening to us today who wants to get more averse with technicals, I would look at weekly charts instead of daily charts. I would look at things like Bollinger Bands instead of simply Relative Strength Index. We look at weekly charts because during the time that we are in a trade or in a position, it’s going to get several buys and sells and the fundamentals never budged. The name of the game is patience. The name of the game is fundamentals. We get paid to wait, and following weekly charts allows you to do just that and the noise in the market doesn’t affect you because you’re looking at the big picture. Michael: Well, what a great synopsis there. This has been quite an information-packed radio show, don’t you think, James? We’ve covered a lot of ground here! James: Michael, you started out by saying September is one our favorite months, and you and I talk about that because we’ve experienced so many Septembers selling options on commodities and we expect this September to be quite a lot the same. Michael: I agree. Well, everyone, I believe that is going to wrap up our show this month. For those listening, our September account slots are closed for this month, they are all filled, there’s no availability this month. We still do have a few slots remaining for October. If you’re interested in pre-qualifying interview for one of those slots, you can contact Rosemary at the office at 800-346-1949. For the rest of you, have a great month. We’ll be updating you on portfolio progress in the bi-weekly videos if you’re a client. Have a great month of premium collection. James, thanks for all of your great information this month. James: My pleasure, Michael. I enjoy doing these and look forward to doing them again many, many times. Michael: Great! Everyone have a great month, and we will talk to you at the end of September. Thank you.

OptionSellers.com
OptionSellers.com's James Cordier and Michael Gross Tell how With the Fed and Brexit Out of the Way, Commodities Opportunities Await Wary Stock Investors

OptionSellers.com

Play Episode Listen Later Jun 23, 2016 31:19


Michael: Hello everyone, this is Michael Gross at OptionSellers.com. We’re here with your monthly Option Seller Radio Show for June. We have a lot of stuff to talk about here this month, simply because of the news going on this month. Probably first and foremost, James, what we want to talk about here is the FED decision or inaction, as we say. Obviously, that was a big topic on Investor Mines here in June. The FED did not act – the reasons why were kind of obvious to everyone so we don’t need to talk about it here. I think probably one of the first things we should talk about for out listeners is what the means for commodities right now. What’s the macro picture in commodities? James: Michael, the macro picture right now is perfectly mixed. We have 0% and negative interest rates all around the world, which is extremely the main reason why the Federal Reserve here won’t be raising interest rates at all this year, possibly once maybe after the election, something along those lines. U.S. companies certainly can’t afford to have a strong dollar. With everyone else racing to zero and now below zero for interest rates, clearly the Federal Reserve is going to hold off on raising interest rates here. The strong dollar would be a catalyst for other strong economies to do well, and for the U.S. economy to suffer, and certainly we don’t see that happening. So, we’re looking at the newly 0% interest rates here in the United States, negative interest rates everywhere. Generally speaking, historically, that is going to be bullish for commodities; however, the fact that we have such low interest rates because economic growth around the world is so weak right now. So, on the flip side of 0% interest rates is that economic growth right now is small. Copper demand, steel demand, zinc demand, and soybean demand is way down. For that reason, we see a very mixed picture for commodities for the last half of 2016. We see a lot of up and down because of that, and we think a lot of commodities are fairly priced, and what the Federal Reserve is doing right now is simply jawboning to get the market to do what they want it to do. At the end of the day, we’re looking at very few interest rate hikes this year. That is, I think, what Janet Yellen spelled out in June. Michael: Yeah, it has been all the talk on the financial channels and the paper and what the effect is going to be on equities now, and you have Jim Cramer talking about buying defensive stocks because he’s more concerned about the global financial picture. Do you have any thoughts on that? Stock traders have two choices: they can be long or short. The typical investor gets advice like “Well, you buy defensive stocks and hope to try and ‘ride it out’.” So, they’re playing defense if they’re expecting lower prices. A lot of times, shows like Cramer’s don’t cover “Well, why not go on the offense with strategies like options?” You certainly brought that to my attention, because now’s the time you can go on the offense with different commodities markets, even the stock market if you want, but commodities in particular. James: Michael, I think that’s why we have so many investors knocking on our door right now, simply because they do want to diversify away from the stock market. Buying defensive stocks, if the stock market falls, isn’t going to help your portfolio all that much. Basically, as Mr. Cramer’s referring to, getting involved with defensive stocks is simply going to make your portfolio fall less. As we know here at OptionSellers.com, if we see something developing, whether it’s a bull market, bear market, or something in-between, take advantage of that, and that’s what we’re able to do selling options on commodities. We can actually bet on lower values. As a matter of fact, that’s what we like doing best, as you know. Of course, call options on commodities, sometimes 50% and 100% out-of-the-money, certainly a great way to participate in what might be a bear market 2016 and 2017. Go on the offense, and that’s certainly what we do here at the office for our clients on a daily basis. Michael: Something we talked about in the newsletter this month, and I don’t remember if it was a letter you got or not, but somebody asked, “It seems like you guys sell a lot of calls. Are you perpetual bears on the market?” Your answer was, “No, we’re not perpetual bears on the market. We can be bullish or bearish. It just so happens that oftentimes because it’s public speculators, calls are often more over-valued than puts.” Can you talk about that for a minute? James: It’s certainly true. When we have a move up in silver, silver recently moved up from $16 to $17.50, when soybeans rally because of dry conditions in the Midwest, the public really pushes prices on call options further than they normally would be. Fair value is still something that we follow. Puts sometimes get overpriced, but call prices on commodities get absolutely inflated. We had made note recently in one of our videos that we think that June and July we’re going to look back at the end of the year, that absolute crescendo in call premiums on many commodities, and so many stock portfolios that sell options on stocks. We’ll talk to new clients and they’ll say that they’re selling options 2%, 6%, 8% out-of-the-money, when you can bet on a commodity to not double in price by selling a call 100% out-of-the-money. What would you rather do? Michael: Alright, James. Speaking of taking alternative approaches with options, etc., a lot of high net-worth investors have an interest in hedge funds or may have investments in hedge funds. I wanted to bring up an article here from the Wall Street Journal, last month, from May 13th. Its called Hedge Funds Annual Bash is Downer as Industry Flags. The whole thing is about this big annual party they have out in Las Vegas for all these hedge funds managers. Bernie Sanders would not be happy – I’ll put it that way. They have all these bands and celebrities and everything else. This year, there’s a real downer mood there because a lot of investors are pulling money out of hedge funds. Major hedge fund clients, including Chinese sovereign wealth funds, during this thing aired doubts. The general feeling was that 90% of hedge fund managers probably weren’t skilled enough to navigate the markets. That’s how they felt and that’s why this money is coming out of hedge funds right now. Do you feel that’s accurate or do you have any input into that? James: Well, Michael, I read the same articles. A lot of that was floating around over the last month or so, especially in the Wall Street Journal, paying hedge funds two and twenty, simply trying to chase return right now is extremely difficult. I think there was a record number of hedge funds that closed in 2015 and the first half of 2016. It’s easy to be a hedge fund when the stock market is going straight up. It’s easy to produce returns that way. What happens when interest rates are at zero? What happens when the stock market goes sideways for the last 18 months? Where do you make 15%? Where do you make a 20% return? It doesn’t exist. I think my favorite piece out of that Las Vegas soirée this past month was some of the biggest banks sticking out their biggest chests over the last several years. We’re telling they’re clients that they had to get to the club and back using taxis and they weren’t using limousines this year. When the hedge fund industry can’t get their best prospects to and from the restaurant and they need to get their own vehicle and their own transportation, I think that says really something. Going to Vegas once a year, you have to just be absolutely confident that the returns are still coming and sticking your client in the back of a cab probably isn’t a good sign. Michael: Well, the thing about hedge funds, and they argue that it helps reduce volatility etc., etc., and that’s why you shouldn’t bail out, but a good piece of the article was about that stocks have been going up for the last how may years. Nothing against hedge fund managers, there’s a lot of great strategies and very gifted individuals, but, on the other side of the coin, a lot of these guys are just glorified stock pickers. If that market’s going up they’re going well, and a lot of investors look at that and say, “Great… I made 8% or 10% last year. I could have done that on my own. Why am I giving you 20% of my profits and 2% of my account?” So, that’s what I saw and that was my takeaway from the piece. It was an interesting piece, nonetheless, and for those of you that invest in the hedge fund industry, maybe look for some alternative strategies other than ones that focus entirely on stocks. Speaking of alternatives, we did a special report this month on natural gas. A lot of that revolved around the seasonal tendency, James, and how a lot of people get it wrong. The pop analysis is you buy natural gas in the summer, and that’s not necessarily the case. Can you talk about that a little bit? James: Michael, I think what happens in natural gas during the summer is similar to other commodities that people just jump on. Fundamentals are what dictates eventual price, and short-term headlines is what creates opportunities for investors like OptionSellers.com. The bottom line is this: everyone is watching the weather, everyone is trying to chase return, everyone’s looking for the next best way to make a buck, especially with interest rates flat like they are. It’s 120 degrees in Arizona, breaking records, let’s buy natural gas for this heat wave. This sort of thing happens all the time. Fundamentally, we have ginormous supplies of natural gas, both in the United States as well as around the world. What investors need to know when the jump into a commodity like natural gas, because it’s going to be hot this summer and they think we’re going to need electricity to cool homes and cool factories. The bottom line is this: winter demand for natural gas is 5 times greater than natural gas consumption during the summer. So, as investors pour into natural gas because it’s 120 degrees in Arizona and they think they’re going to get rich going long natural gas, that probably isn’t going to work out so well. Natural gas demand is needed in the winter. We have production ramp up for natural gas supplies that are going to be needed in the fall and wintertime of the year, not in summer. We are looking at selling natural gas here with both hands. We had a one handle on natural gas, Michael, as you know, just a month or two ago and the November and December contract are pushing up towards 3 and 3.50 per million BTU’s. That, in our opinion, is a sale. We have the public and headlines pushing natural gas right now. This fall, natural gas is going to be pushing the low 2’s and possibly the high 1’s. Once again, don’t trade your investments and your hard earned money based on headlines. By the time it hits the headlines, you probably want to go the other way and, if you have the ability to sell options, we actually can go the other way. Similar to being on the offensive, Michael, like you mentioned at the beginning of our show today, there are ways to go on the offensive. You don’t have to just get out of the market, you don’t have to buy defensive stocks, you can go on the offensive, and I think selling natural gas for the rest of the year is a great example of doing just that. Michael: The best defense is a good offense. You talk about selling deep out, so the thing just rallied. Funny you brought that up, because natural gas was in the Journal yesterday. They’re talking about warm weather and a lot of specs coming in, so the thing rallies and obviously that drives up volatility, but how far out-of-the-money are you looking to sell calls now? James: Natural gas, the timing is a seasonal trade. Quite often, we sell options 6 and 12 months out. On this particular, what we think is a great opportunity; it’s not that far out. The spot month, of course, for natural gas is going to become August here in the next week or so. The November and December contract are the ones that we are keying on. September, October, November, a lot of investors and analysts think that’s the beginning of winter, but, in all actuality, in Boston, New York, and Philadelphia, it’s not that cold in October. So, we’re looking at selling options for early winter delivery and we’re selling options anywhere from 30%-40% out-of-the-money. We checked the margin rates on these and the possibly decay and that trade looks excellent, so we’re starting to position our clients in that this week. Michael: One thing I like about it, as well, is that it’s not just a seasonal trade. Overall supplies of natural gas right now are 32% above the average for this time of year. As you mentioned, just a huge glut in the market right now, which that’s the bottom line fundamentally in natural gas, regardless of what you’re reading in the headlines. James: Michael, that brings up a great point. A couple months ago, we were talking about trading seasonally, however you want it to line up with fundamentals, and vice versa. Every once in a while, we’ll have a seasonal trade comes up and it’s not geared with the fundamentals. This trade has both. As you mentioned, the supply of natural gas is just huge and it’s several percentages above the 5-year average. It’s 30%-40% above what it was last year. This trade appears to be lining up quite well. The fundamentals is how we trade: that always comes first and seasonality comes second. The fundamentals right now, as you mentioned, are very bearish long term for natural gas. Michael: If you’re listening to this, this isn’t a discussion where we’re saying the natural gas markets are going to crash tomorrow and you need to short it today. We don’t know if the market is going to turn around tomorrow, it could keep going up for the next month. That’s one reason why we are talking about selling so deep-out-of-the-money is you give the market room to do that and still take advantage of those longer term fundamentals and seasonals that James was just talking about here. Speaking of the longer-term fundamentals, in our upcoming newsletter, we also have a feature piece on the cattle market for the summer. That’s going to be coming out here at the end of the month in June. It’s steak and barbeque season and, again, another seasonal there that some people don’t really understand, so we really get it straightened out for you in this month’s newsletter. You can look for that at the end of June, probably July 1st, most of you should be receiving that both electronically and via hard copy in your mailbox. Also, one thing I want to point out in this upcoming newsletter…. We have a very unique interview this month with a gentleman named Don Singletary. Don recently published a book called Options Exposed Playbook. He worked in the commercial hedge industry for over 25 years, so he really brings a unique insight into the difference between what commercial traders do and what the public is doing. If you have any interest in commodities or selling options, it’s just a really insightful interview. I really like this guy and I think you will, too. James, you also had some media coverage this month at a little debate on CNBC with a gentleman named Andy Lipow. How do you think that played out on air? James: Well, it’s interesting. We’re not on CNBC all that often, but we’re on from time to time. What I like most about when CNBC calls, either the gold market or the oil market or the coffee market are at extremes, whether they be the high or the low, and that’s when they often bring us on. We, of course, think that the oil market is probably overpriced. We think it was a seasonal rally and the fundamentals, we think, are going to probably bring crude oil prices down later this year. Andy was bullish. There were several reasons for his side in the interviews that we did. He was siding on Nigeria, we have problems there, and, of course, the Canadian wildfires. I went on to say that all of those are temporary. Iraq and Iran are now producing record amounts of oil. That’s okay for overproduction from certain countries when demand is high. Here in the United States, of course, driving season is the highest peak for consumption of oil anywhere in the world during this timeframe, but overproduction when demand is down this fall and winter, that, I think, is going to spell quite a different story. We went on to say that we expect oil to be in the high 30’s later this fall, like November and December. That, of course, is one of our favorite positions that we have on right now. We recently sold $75-$80 call strikes for fall and winter delivery on crude oil, and we believe that prices will be roughly half of that. Once again, the call options that we sold might be 100% out-of-the-money this fall. We think that what makes a market is a bull and a bear. Andy was bullish, and we think that it’s time to start looking the other way. As a matter of fact, that’s one of our favorite positions that we have on going right now, going into fall of the year. Michael: James, you made some good points. Backing up the hypothesis that oil prices are getting overpriced right now, I want to bring up another piece in the Wall Street Journal recently. This was from May 27th. There was an article in the paper titled Everyone’s Trading Crude, from Moms to Millennials. If this sounds familiar to you, it’s similar to what typically happens when markets get a little frothy. If you remember back in 1999 with the tech bust when everybody and their brother thought they could trade tech stocks, it’s kind of the same thing going on in crude right now where you have 22 year old college kids and moms all trading crude oil and different crude products, talking about how fun it is, and how they like to watch the market go up and down. Here’s a quote from a lady. This lady’s a math tutor. She says, “If oil goes from $43.50 a barrel to $43.70, you’ve made $100!” So, this lady is doing this for fun and entertainment, and when you have that crowd that are coming into the oil futures markets, that can often be an indication that the thing is possibly getting a little bit out of hand. Would you agree with that, James? James: You know, Michael, when the stock market is at all time highs and the barber is invested, and the guy who shines your shoes is talking about stocks, that sounds familiar. The gold market, when it rallied up to 1,900, everyone was going into coin stores and buying gold. This move in crude oil feels a lot the same. Once you have moms and millennials staying home to trade crude oil and, of course, be on the long side, because the market is bullish, that has signaled a lot of tops in the past and certainly it has all of the makings of one, as well, this summer. You know, crude oil was down at 27, rallies up to 50, that’s going to make a lot of headlines, but it’s maybe not the right time to get in. Michael: Well, for those of you listening, if you missed James’ debate with Andy Lipow, you can see it on our website at OptionSellers.com/CNBCJune. Also, we had a question that came in from people asking how to get our newsletter. There’s no specific place on our website you can request our newsletter, but if you request anything from our website, whether you request our booklet or buy our book, or you get on our e-mail list getting our free report, you’re automatically subscribed to the newsletters. So, if you do want to get copies of the newsletter you can go on and request our free report and you’ll start getting the newsletter. James, let’s shift gears a little bit here and do our strategy lesson for this month. This month, what we’re going to cover for our listeners is not so much a strategy, it’s the approach to the strategy, and that’s selling deeper and the ability to sell a very deep out-of-the-money in commodities. As a lot of you listening right now may be stock options sellers or sell options on indexes, commodities allow you the ability to sell much deeper out-of-the-money and it’s really a matter of trading time for distance. James, can you talk about that a little bit about what your philosophy is on that and how you go about employing that? James: You know, Michael, that’s probably the most frequent asked question when we have a new client come on board with us is how far in time do you want to sell out-of-the-money. I normally have felt like everyone else did the 90-day option, as it probably gives you the best decay, gives you the furthest amount out-of-the-money. That’s reasonable when you’re considering risk and reward. I have now sold millions of options on commodities over the last several years, and what I simply do is look for the furthest out-of-the-money that I can find that offers the greatest amount of decay. You can simply look at option tables by pulling up your CQG or your Bloomberg Terminal and you simply look at what the decay is probable for the next 8 weeks, then the previous 8 weeks, and the previous 8 weeks. So, if we sell an option that is 9-12 months out in time, we can judge by looking … for example, if we’re looking at selling the July silver options, we simply look at the May. If it’s roughly 50% of what the July contract is, we know that even if we’re selling 9 months out, we can expect to see 50% decay in just 8 weeks. You then will look at, say, the March contract. That will often be 50% of what the May contract was for a particular strike, for example, in silver. You are now looking at a short 16 weeks, have an option practically go from $600-$700 down to just $100 per contract. That is fertile territory for selling options. Though we are selling strikes that are 50%-100% out-of-the-money, and it appears that we are selling out nearly a year in time, the sweet spot is much closer than that. You’re looking at simply 2 sets of 8 weeks for an option to lose ¾ of it’s value. That is what I consider low-hanging fruit and that is who we detect the best time value as far as selling options. It’s something that anyone who is interested in learning more about that, I can explain it to them further so that you can understand it maybe a little bit better. The ability to sell 100% out-of-the-money is just priceless. In commodities, you can do that and you can gage what the decay is by looking at the previous options that are just before it. The decay can be fantastic in just a very short period of time, even though you’re selling options that far out. Michael: It’s quite a contrast from a lot of the options books and courses out there that tell you if you’re going to sell options then you have to sell them 30 days out because you get the fastest time decay. But then, you’re also selling them right at the money almost. James, an important point you made there is you sell an option 6, 8, 9 months out. That sounds like a long period of time, but what you’re saying is “Look, you don’t have to stay. If you sell an option, it’s 9 months out, you don’t have to stay in the thing 9 months. You can be out of it in 3, 4, 5 months because you’re buying it back early when it’s nearly worthless.” Is that correct? James: My job, Michael, is to fundamentally position our clients in fundamentally sound trades. By finding that 90-120 day period where the decay is going to be the greatest is my job. If we have collected 80%-90% of the premium, we’ll buy back options that have 2, 3, and 4 months remaining on them. Our job is to find the most decay, the furthest distance out-of-the-money, and, after selling millions of contracts of commodity options, I get paid the same whether I sell a 90-day option or a 9-month option, and we sell the 9 month option because those are the best ones to sell. Michael: Well, that’s a great discussion. I was going to do an example here, but I think we already did one with the natural gas here earlier, kind of a perfect example when you talked about natural gas. If you want to go back and listen to that part of it, you get a pretty good example of what we do here. As we mentioned, the newsletter will come out at the end of the month if you want to look for that in your inbox. Also, I have a note here that new account consultation interviews are booked for June, but we do still have some available after July 7th. So, if you’re interested in talking to us about an account you can certainly call and schedule a consultation. That’s 800-346-1949 or 813-472-5760 if you’re listening from outside the United States, and, of course, you can always email us at office@optionsellers.com. And final thought before we sign off here during this podcast, we didn’t mean to ignore the elephant in the room, which is the Brexit Vote. We have the disadvantage of recording your podcast this week 2 days prior to the Brexit Vote. Right now, the surveys seem to indicate that it is pretty much split down the middle. It’s going to be a really close vote. It could have different impacts on the market, but initially we may be looking for some more volatility in different markets that can certainly be an advantage to option sellers. James, would you concur with that? James: Michael, that’s what the first half of 2016 has been, is turmoil, uneasiness about several different things, and lots of headlines. This just feeds into option selling and premiums being too high. We certainly enjoy this and will be addressing this in upcoming videos that we make for our clients and for the audience. Michael: Exactly. James is going to be doing a special video on the Brexit Vote. That will be available next week on the blog. If you like this podcast and the information you get here, you can certainly subscribe to us on YouTube, and subscribe to us as well on iTunes. We also want to invite you to follow us on Facebook. We apologize. We’ve been a little negligent to our Facebook, but we are correcting that. We are going to start providing a lot more content on our Facebook, so feel free to follow us there, as well. Everyone have a great month of premium collection. We will talk to you in July. Thank you.

OptionSellers.com
Options Trading Exposed - The Interview with OptionSellers.com's Michael Gross and Option Expert Don Singletary

OptionSellers.com

Play Episode Listen Later Jun 21, 2016 54:36


Michael: Hello everyone, this is Michael Gross of OptionSellers.com, here with your monthly guest expert interview. This month’s guest expert is Don Singletary, author of the Options Exposed Playbook. Don spent 25 years as a consultant for commercial commodity hedge plans, helping him to implement option strategies to lower cost and increase their efficiency. He has also spent much of that time as an individual options trader. He is going to bring a unique perspective on that to you today. Don, welcome to OptionSeller.com Guest Expert Series. Don: Well, thank you very much, Michael. I’m glad to be here. It’s my pleasure. Michael: Don, let’s start off by telling us a little bit about your background and how you got started in the trading industry. Don: Well, there is a lot to talk about today about options and making money, so I’ll get to the buy out part pretty quickly here. I started in broadcasting at the age of 15 and I grew up in a small town that only had 2 radio stations. I worked for both of them- they used a different name at each one. While I was in high school, I became a licensed broadcast engineer, continued electronics in the Air Force, worked countermeasures during the Vietnam era, and worked for the Motion Picture Bureau at the Florida Department of Commerce and Economic Development. I had the pleasure for several years, a week every month, I spent in Hollywood, California. It’s a pretty remarkable “bubble-world” out there, and it still is. Patty and I were just starting a family in those years and that took a lot of travel, so I gave being a stockbroker a try. One of my specialties there was introducing customers to the covered call writings, sort of a specialty of mine. Now, back in those days, in the mid 1980’s, it was very much a bull market. I think a drunk monkey with a dartboard could’ve made money. As luck would have it, I got to be a broker during those few months. I got a good offer to teach at a technical college right before the big bust in October of ’87. I took a lot of my customers in cash before I left, not because I was smart or I knew a market crash was coming, I just needed to make a lot of money and they had become friends of mine and I didn’t want to leave them hanging. I kind of put them all in cash and gave them a proper goodbye. Now, when the market crashed 30 days after I left to take the college professor job, my clients thought I was a genius. That’s certainly not true- I was just lucky! So, the greatest work and financial undertaking I ever had was the last 20-25 years. I never saw it coming. I don’t think anybody grows up to be a consultant to private corporations for risk management. I never even knew such a thing existed. I spent thousands of dollars on commodity books and the best option modeling software that I could ever find, and I bought a few of the newest and most powerful computers in the early 90’s. I think I thought I was going to be a trader and make a lot of money, but fate stepped in. That was coming, but it’d be later. It was something I never even thought. I got a call from a commodity producer who’d seen some of my option modeling that I’d faxed to a buddy. That phone call resulted in the working in risk management for the next 25 years. I got to work with some amazingly smart and creative people at the top levels of some major corporations, and it was just my good luck. I really got an education that money can’t buy. Michael: Well, we’re hoping you can share some of the pointers you picked up there with us today, Don. I know one of the reasons we wanted to have you on was that you kind of have a unique insight and you have insight into the commercial side of this business, but you’ve also been an individual investor, so you have insight into that side as well and can give maybe people a perspective from both sides of that coin. Before we get into that, Don, I want to talk just a minute about you book, Options Exposed Playbook. Just a great options book for anybody that’s interested in learning about options. Don does cover some option selling strategies in there that I thought were very excellent discussion of. Don, you told me a great story earlier about how you came about writing the book. Can you share that with our listeners? Don: Yeah, I’d be glad to do it. I was winding down my standards of risk management consulting, and I decided to stay home. There’s an old saying by Ernest Hemingway that says, “I drink in order that my friends are more interesting”. I wanted to take some time off and give that theory a test. Fate wasn’t to be. A friend of mine had called and we often talk investments. He said “Hey, I got something here I have to show you. I want to get your opinion. You’ve got to see it!” I said okay. So I met him for breakfast one morning and he showed up with two or three pages he had printed out on the Internet. Attached to the papers, the first thing I saw was that he had already made out a $3,500 check to some investment guru to buy this system. Now, my friend, he’s usually not that excitable, but he was just real excited and said “Look here”, he put his finger on the paper, and I read with him. It said “98% winners for 5 years”. It promised that anyone could probably turn $25,000 into $2 million in that 3-5 years, and that it would only take a couple hours a week, and it took almost no work. I stopped believing in the tooth fairy a long time ago. There are people that live in Austin, Texas in a little bubble who still believe in him, but I’m not one of those. So anyway, I took a good look at the pages he gave me and this magic system used vertical credit spreads, covered calls, and iron condor spreads. It promised the subscribers all they need to make themselves plenty rich with almost no work and in quick time. Now, years ago, I did a stint in the Air Force and I lived a while in West Texas. West Texans have a colorful way with language, so I told my friend a little saying I picked up back in those days in West Texas. “If a fella comes at you with a ten gallon hat pulled over his ears in an ear to ear grin, and he seems too glad to see you while shaking your hand a bit too much, you better look down and make sure he ain’t peeing on your boots”. We’ve all seen them, and we get these kinds of things in e-mails and in the regular postal mail all the time. By the way, Boone Pickens didn’t say that, but maybe he should. I took a couple of sheets and scratch paper and I showed my buddy how to do these pre-strategies. I had a little experience with them doing options. But I just told him, this is all the guy is really doing and he is doing it over and over again. Personally, I don’t believe for a minute the fantastic claims he makes. My friend interrupted and said, “Well, if he’s half right, I’m going to do really good!” I said “Yeah, that’s true! I can’t argue with that!” After I took a couple of pieces of note paper and scratched out some diagrams and made a few notes, suggested a few places where he could find some more information, he tore up the check and he said “You should write a book about this”, and I was giving my friend all the reasons why I was not, absolutely not, going to write any book on options right now. I left that meeting thinking that I had done my good turn for the day. When somebody tells you not to think of elephants for the next 2 hours, every time you close your eyes it’s all you can see. So, I started thinking about it if I was to write this book. I’m more or less retired now, but if I were going to write this book, what would be in it? Before I knew it, I was consumed by it and it only took about 10 weeks to write the book. That’s the Options Exposed Playbook that I have and I was a lucky man as far as selling really well right away. I got very interesting e-mails from a lot of readers. Some had absolutely no experience and ranging all the way up to Ph.D’s who were asking me about the inadequacies of the Black Scholes Formula, and that’s a conversation that I did not want to get into. Before I finish this story, I was preparing for this interview this morning, and here’s one here from The GURUS Selling System. It says “I know I’m reaching you on Sunday, so I’ll be brief, but you’re about to miss out on the best opportunity to make money you’ve ever seen….You see, this guy selects trade recommendations with a high probability of doubling your money. For example, on May 16th, made 106.9% gains in 3 days. May 17th- 70.4% in 2 days. May 23rd, I made an amazing $8,000 in 24 hours.” Now, these kinds of ads prey on people. Often, it’s people who are desperate who could believe an ad like that. Here’s another one that says “Just 7 days, you pocket $2,000 on one trade and you make $725 the next day in 4 short days. You make another $950 and people make $100,000 a year this way”. These types of ads cater to people- not a sophisticated audience, but they cater to people who are hardworking people and think like my friend did that if they’re half-right, they’re going to make a fortune. One of my motivations in writing that book- I don’t spend a lot of time in it bashing these kinds of systems, I think that’s a waste of time- I simply wanted to save beginner and small intermediate investors, beginners small and medium sized accounts, I wanted to save them from playing the slot machines. I noticed in your book and mine, as we did this completely independent from each other years ago, we used casinos as an example when we talk about selling options. In my book, there’s a line in there that says “You went to a casino and the manager said ‘you’re kind of stupid. We’re only going to let you play the slot machines’.” You can’t sell options if you’re not sophisticated yet because you don’t have the experience. The slot machines pay out 95-98% of the money that’s put into it, and there’s always somebody that’s at the machine ringing and flashing its lights. When I go to Las Vegas, the first thing I do, just to remind me where I am, is I go down… Las Vegas is a Petri dish for human behavior, and I’m a people watcher…. I go down and I pick out rows of a hundred slot machines. At any given time, one of them is ringing and flashing loud bells and whistles, but I’m looking at the other 99 who all have losers sitting in front of them. Those things are like parking meters. The more you play, the more you lose. I think buying options can be that kind of game, but somebody hits it big once in a while. It’s like playing golf- you tell somebody about your hole in one you made for years, but you never talk about the ones you lost flushing them into the woods. I think investing and gambling may have some of that human behavior in common. There’s an old saying that says “Experience is what you get when you get what you didn’t want”. I’ve had a lot of experience! Michael: Well, your experience has certainly resulted in an excellent book, Don. Wanted to congratulate you on that and certainly recommend that to anybody reading the book. I wanted to go back and touch on the point you made about the guy selling courses for thousands of dollars, and usually selling them to the people that aren’t really educated that much in trading, although not always. Even experienced investors sometimes will buy these courses. I don’t want to bash all of them, because I know some of them have some good information. Don: Sure they do, Michael. One of my favorite books is by the old guy Will Rodgers. It’s what keeps me humble- that and investing. He said that everybody’s ignorant, just about different things. When I’m talking about neophyte investors, who earnestly are hardworking people, are very prodigious people in their work and their demands, and they’re just trying to do better, their motivation is absolutely stellar. Anyway, go ahead. Michael: Sure, no, that’s a great point. But there are a lot of these courses at there that they are charging these thousands of dollars for promising outrageous profits. In fact, I wrote about one in the upcoming newsletter where there’s a guy on CNBC now that said he took $4,600 and turned it into $460,000 in 2 years. I would be a little skeptical of those types of claims. The thing about it that a lot of these people don’t realize, even these courses that are good, a lot of that information you can get by picking up a couple of books for $30, $40, $50 a piece. Your book is a perfect example. When I talk to you about this book, I said “So, are you selling a course? Do you have a seminar?” and you said no, I just wrote the book to help people understand how to do this, so you don’t have anything you’re selling. It’s purely a book that is showing people option strategies that have worked for you, kind of bringing a perspective of both the personal and individual investor side to it. When you wrote the book, what would you think the biggest difference is or maybe the biggest advantages of being a commercial player or the advantages of being an individual investor? Don: That’s a great question. A lot of people- just hate the word hedge fund, which when you’re in risk management working with a corporation, usually ad commodities, it’ll be something like cotton, coffee, or orange juice or sugar. The goals of the commercials and the individual speculators are almost polar opposites. In helping people with their commercial risk management plans, and the term hedge fund is not the same as a fund you use to hedge for risk management. I don’t want to get into the semantics of it, but there is a big difference between the two. Commercial players I work with and the people who use hedge funds, their motivation is to preserve their capitol, to eliminate risk, and to get the highest possible margins on their products that they can. Now, some of them are selling commodities and some of them are buying them, and these can be commercial players on both sides of the same market, of course. It’s not just the speculators vs. the commercial players. I’ll give you an example: Maybe a speculator is selling a $5 bushel call for a relatively small premium and maybe this plant makes ethanol and has to buy corn. If corn goes over $5 a bushel and he has to pay that price, then he’s not going to have much profit margin, if any at all. So, what he does is buy a $5 corn call and if pollination doesn’t occur right, or weather gets too hot, or demand ceases or whatever the reason, if corn prices soon pass $5, instead of going out of business or having a year so bad he has to work the next 2 years just to make up losses, then they buy $5 calls and pay too much for their product, corn, which helps them make ethanol. At the same moment, somebody else on the other side of the market is saying, maybe a speculator, “Boy, corn has got some of the lowest stocks it has had in 5 years. Last year topped at $4.60 and maybe it’ll hit over $5 this year. Maybe I can afford to spend a few hundred dollars to bet that corn prices are going to hit the ceiling. Then, these two orders at the markets someplace meet, the transaction occurs, and everybody’s happy with what they did. It’s just about a zero sum gain. I don’t really see what we did. In fact, we used to have a rule and I explained this to my customers because I knew the CEO’s I was talking to would be talking about risk management. I discouraged them from using the word “profit” at all, and substitute the word “margins”, because we don’t care. We lose a bunch of money in a risk management account, and they say they’re startled to hear me say that. I say “Well, if it means you make more profits, then that’s fine! A higher profit margin is the goal and we’re not going to call them profits because they aren’t profits for the company.” Motivations in conserving capital to get rid of price risk and delivery risk, weather, or government upheavals, or changes in the laws and all those things. Plus, frankly, in the risk management programs, they can make some very creative contracts about buying options that they can offer their potential customers to give them an edge over their competitor…. things like that. Michael: Okay. So, a lot of the things you did in the commercial side of it was really helping to manage the true definition of hedging, where you’re helping them manage their risk for the price of the commodities they’re actually working with, whether they’re taking delivery or selling them. You have speculators on the other side that are taking the other side of those trades and both sides are getting what they want. Don: Many times, I work for an orange juice company, _____, at a processing plant, and they had a lot of their products sold, but they still had millions of gallons of orange juice in the tank. It wasn’t priced yet, it wasn’t sold, and they had uncertain profit margins to consider. Another of my clients, at the same time, was on the other side of the market. It was a very large grocery store chain, and they knew how much shelf space they had for orange juice, and they knew from years and years of selling orange juice about how much they were going to sell in the coming year. All the orange juice they know they have to put on the shelf but they haven’t bought yet is a price risk to them. If you had a freeze and all of the sudden prices went up and people who couldn’t even deliver the orange juice because of the damaged crops, the grocery store still has the same shelf space and demands from their customers. So, they would hedge and release themselves by selling options and contracts to speculators, they could insulate themselves so the contingency of price and delivery risk, that kind of thing. What’s fascinating is I felt like Dr. Jekyll and Mr. Hyde for working both sides of the market, but, actually, they weren’t really at odds with each other, they were at odds with the risk that was in the market – and both of them could successfully make trades to help meet their margin goals. Michael: Yeah, that’s a great point. A question we get often here is, a lot of people ask, “Well, you guys are selling these options. Who’s buying these deep out-of-the-money options? Yeah, sometimes it’s other speculators that are buying lottery tickets, but a lot of the time it’s these commercial players that don’t want to buy them, they have to buy them to insure their business. It’s like buying insurance. Don: Absolutely. It may be from a speculator who said, “Man, I’d never do that. Who’s crazy enough to take the other side of this trade?” 80% of the options expire worthless, as you point out in all of your material, too. That’s pretty good odds from the start. The thing I love most about selling options, and this is all in your book and mine I supposed, it doesn’t demand that you have to guess price direction. The amplitude of the price changes, nor do we have to do that within a defined time. Buying options is like standing on one leg and shooting at a moving target. Selling options can be like making a partnership with gravity. Gravity and time decay both work regardless, rain or shine, 24/7, in all kinds of conditions. They’re not dependent on the stock market and commodities, and they don’t depend on public opinion or on anything. One of the things about the financial channels, and, you know, this is July of 2016 and we’re in the middle of this presidential thing going on, which is the real Petri dish of human behavior, I think. It’s interesting no matter which side you’re on. It’s just crazy what the news channels do. It was all about the candidates a few days ago, they were running out of news, they were getting in experts to talk about every contingency that might happen. It was a slow news day, so they would take the small stories and somehow embellish them a little bit and bring them to the top so they could keep listeners, so they can sell adds, so they can make more money. It’s really funny on the financial channels, they even do that. This tragedy that happened in Orlando, Florida 2 days ago, now the financial channels are not talking about politics, but they’re talking about terrorism and what that means to investments and which investments would be best if there is a terrorist attack. These guys, with all do respect, they have some very bright people, but they have a tough job. They have to show up every day to a non-scripted program, and this goes for network news, too, and they have to take whatever is in front of them and make it sound like the sizzle on a steak and sell it to the listeners every day. With TV, they’re able to do that. Aaron Spelling, I think it was, said one time “The TV, you don’t have to be really good at programming because TV is a medium that has a default that’s kind of the most effortless thing to do- you just sit there and watch it.” I do it, everybody does it sometimes. It’s a rest for your brain sometimes, or whatever your reasons. It’s interesting and all of this fast Internet information everywhere we can get, it’s a lot of toxic half-truths and innuendo information. My mother-in-law, who’s in her 90’s, I tried to keep her from watching the news because she would just buy a new lock to put on the door every time she saw the nightly crime report. I think investors made that mistake when they watch the financial channels, and maybe some of the other news. It’s just a type of telescopic fear. It’s like you never think about an asteroid hitting earth. Matter of fact, just 3 weeks ago, there was a comet that came within 2.2 million miles of the earth and it was ½ a mile wide, and it would have had a giant impact and probably killed hundreds of millions of people. But you didn’t hear about that in the news, and we’re always in that unlimited risk like that, or satellites breaking, or things like that. I think unlimited risk gets a really bad rap because people are always taught to be afraid of it. There’s some merits that you go into in some great detail, and you and James Cordier’s material about what unlimited risk is and what other people sometimes fear. There’s a way to understand it and a way to be able to use and to do it intelligently and within the laws of a very good mathematical probability. You guys do a great job with that. Michael: Thank, Don. I appreciate that. You made a great point there I want to go back to for just a second, because I think it’s important and we talk about it a lot as well. The role of the media in both stock and commodities prices… we talk about, in some ways, you can actually use it to your advantage. The way you do that is by doing your own research or knowing where to go to look for that fundamental research on your own, and knowing what’s important and what isn’t, because if the media, like you said, they have a slow news day or they feel like covering something, they can take something that’s really, in the big picture, somewhat insignificant, and make it seem like it’s a big story for that individual stock or commodity. That can move the price- maybe not for the long term, but for the short term. If you know what the real story is, you can take advantage of that as a trader. It’s one of the reasons we spend a lot of time on fundamental research here and we recommend individual traders, if they’re trading on their own, they do the same thing. Don: Right, and that’s another reason why I love commodities. I have great respect for the work that you and James do there. It’s because you study the fundamental information on these markets. You know where the corn stocks are, you know the seasonal patterns, you know when grain pollinates, you know when the harvest begins, you understand world market, and you understand the United States Market. There was a story on TV on something that kept the commodity prices really not in sync with the true supply and demand. You have the ability because of your experience and because you stay up on these things- that’s your job. You can talk with your investor and let them know that it’s a puff news story or rumor or whatever. A number of years ago, there was one case of mad cow disease in Canada or someplace that crossed the Northwest United States. This sent ripples through the commodity markets, just on potential that we might not be able to buy a steak in 6 months. As a result of that, on down the line, prices went way up on the cattle. A lot of people that thought they wouldn’t be able to afford cattle got rid of the breeding stock and we’re still recovering from that, even though it was years ago. It takes a specialist in commodities and in these markets. Each market can be very specialized, and I don’t know very many people, any people, who are good at all the commodities markets. I know people claim to be, but I’ve never seen it and I’ve never heard of it. You have to go with 4 or 5 markets that I’m familiar with and have experience with and it’s kind of like writing a book. You have to write what you know and you invest what you know. You take things that you have all that experience in, rather than take a whack at something that might look attractive temporarily but you really don’t understand the market. That’s the value of having somebody like you at Option Sellers. These high net investors you serve, that’s the pivot and the very heart of what you do. The other side of that is being able to know the math and understand the mechanics of the market and things like seasonal volatility, and you incorporate fundamentals in there. With a high net worth investor, they can do things that most of my readers probably will never be able to do. They have a large enough capitol. You take a small investor that’s just starting out and maybe has an account of $10,000. There’s no way he can afford to draw down $5,000 the first week he makes a commodities option investment. I find net worth investors are not only able to tolerate that, but able to use the system that you guys use. I think it’s amazing and they can have a great deal of success with that. The huge benefit to investor for the types you do, I don’t recommend people start off dealing with a highly complicated commodity market, and the strategy that might be a naked option with unlimited risk, because, for a small investor, that can put you out of business in 2 days. You’re done. I teach that we’re going to start this way, we’re going to practice it, and we’re going to build it slow and sure and they can be able to do that. They can’t afford the same programs you offer for high net worth investors. For the people who do fit that category, I’ve never seen a better way to do it than what you guys do. Michael: Well, I appreciate that Don. I do, that’s a great point to make, as well. I do agree with you. I think there are some advantages of economy of scale when you get into and working with higher dollar amounts. Obviously, that’s one of the reasons why we have our minimum where we do. There are strategies that can fit almost any size of investor. It’s just a matter of matching the strategy. Let’s talk about that a little bit, Don. You’ve traded commodity options, you’ve traded stock options, do you have a preference for either one or an advantage(s) you think one might have over the other? Don: Yeah, well, like you just said, you’ve got to find suitable investments for the right advisors. For myself personally, since I have a lot of experience in both stocks and commodities, I stay in both. To me, normally, people will trade stocks first because some of the volatilities and some of the limits on all the smaller accounts, and they will start off in stocks and things. Those are the people that I suggest in my book a great deal, and I don’t talk a lot about commodities in there because I don’t want to give beginning investors the impression that they can make a killing in commodities. I’d start to sound like one of those ads I read a moment ago. Those things are doable, but they have to be doable to the right investor. Giving advice to my readers, one of my favorite trades is the vertical credit spread. They can put a capitol on a risk and make a relatively high return in 30-60 days out selling some options, and then they buy an option further out-of-the-money so they put a cap on any lawsuits they might have. When you do that, you can compute the risk of war ratios and it helps you with your money management in the account. Just like a floor trader, your first job every morning is to get up and survive to invest another day in preservation of the capitol, whether you’re a large investor or a small one. That’s number one above everything else. Now, I don’t get paid for selling any advisory services. I just do not want to do that. I ran around for a long time and managed a lot of money in hedge accounts and things, so it’s not something that I want to spend, at my age, the rest of my life doing. So now, I just love being able to write and share some of the information every day. I had a note here that I wanted to go over with you… These days, the old pros that learned years ago when they were doing Black Scholes computations, slide rules, it’s so 1985, to tell new investors that you don’t have the experience, you’re better off not even going with those options at all. You go find yourself different stocks. I read a Warren Buffet story one time that had a great impact on me. You remember the old mutual funds, and still many people have them these days. The ETF did kind of a better version of some of that type of investing. I don’t miss mutual funds lately, but I don’t choose investing in them. It’s because of what I read that Warren Buffett had said. I’m paraphrasing, “If I own race horses and I have a stable of 80 horses, and I know that 10 of those horses win 90% of their races. I’m not going to run all 80 horses, I’m just going to run the winners and stop picking now when the market has a new normal because of the news channels, the types of investments, and the sophistication. I think you have to find some winning bets. Frankly, 80% of options expire worthless; they’re certainly investigating to be able to go there. But you don’t race the whole stable, even though they are all thoroughbreds, because you just tend to jot down your profits. We live in an age with Internet and all the toxic information along with the good. The trick is being able to shift that out and to be able to discern which kind of investment is right for you.” I think Warren Buffett was on to something there. You know what they say about normal- it’s just a setting on the dryer. None of us are normal. Our needs and aspirations and everything are just not the same. I think those are decisions everybody has to make for themselves. Michael: I love that analogy of the racehorses and I also like the way you applied it to the options because it really does carry over like that. As you mentioned, if Warren is listening to the OptionSellers.com Radio Show, we certainly invite him to call in and give his opinion on that. Don: Well, he has been known to make millions off of covered calls. Michael: I know. It’s surprising if you go in at times in different part of the Wall Street Journal articles about who bought or sold these many options in the options market, and you don’t picture guys like Warren Buffett and Carl Icahn making these big option trades. You see them taking positions in stock, but they sell a ton of options. It’s well documented. Don: They’ll buy a great dividend stock these days that’s 2 ½ or 3% and then they sell covered calls on it. I don’t have their numbers in front of me, and I never will, but they might be able to make 5-15% more a year depending on the markets and the timing, but they can make a very nice return. Putting your money in the bank these days, you remember the old rule of 72... you just divide the annual interest rate into 72 and you get the years that it takes to double your money. If interest rates are 2%, it’ll take 36 years with your money in a bank savings account in CD’s to be able to double the money. For most of us, that’s just not acceptable. Michael: Yeah. I agree. I want to go back to something you mentioned because I did want to re-visit your book for just a second. You describe some really solid option strategies in there, but you said your favorite option selling strategy, you preferred vertical credit spreads. That’s one of our favorite strategies, too. Can you maybe just go through a quick description of how you would write that if you’re writing it on a stock or commodity, for instance? You probably talk about stocks in the book, so maybe just talk about how you would do that on a stock. Don: Sure. Well, first of all, I’d pick a stock. The nice thing is, and you go over this in your material too, anybody selling options has to understand that one of the major advantages is that I don’t have to guess prices direction or the amplitude of the timing. I just need to know where I think the stock price will not go. Then, in ¾ of the time, I’ll make money with it. That’s the whole thing. Vertical credit spreads limit themselves to this. If I had a stock that I think is going down or that it has already gone too high, I don’t try to press the reversals, but maybe it starts reversing. You want to be able to try and sell some options. With the market near it’s top all-time highs now, there’s a school that thinks it’s going higher, a school that think it has got to turn around and go lower, citing the bad economic news given daily now. I have no idea which one is going to be right. That’s why I don’t sell the apart, out-of-the-money call if I think the stock is going down. That leaves you with unlimited outside risk, because if price overruns your strike price, you’re going to be in the hole- it’s going to cost you and you’re going to lose money. With a vertical credit spread, you go just a little bit above the strike price. You go a little bit above the price where you sold the call and you buy a cheaper, less expensive call, and that puts a cap on your potential losses. So, with a cap on your losses, let’s say you’re a beginning option writer in stocks. You may collect $150 in premium by selling the call at a lower strike and then by buying one of the higher strike you might spend a third or a half that money, say $50 out of $150 to put a cap on your losses. So, if you have losses that are at the most $500, and you can make $100 profit off of it, that’s 20% in 30-60 days, which is great return on your money. Michael: Now, that’s a great strategy. I was glad to hear you say that because a lot of books and going back to some of these courses out there, they’ll talk about things like converted butterflies and everything. I know those can have their place, but a lot of times, especially for individual investors, they can be difficult to implement, especially if you’re doing it on a larger scale. We always say simple is better and vertical spreads are a great, simple strategy that can also be very effective. Don: One of the things, I get a lot of e-mails from my readers, and a lot of these people have never dealt with options. Most of them have little stock experience. A lot of them, frankly, are young millennials who had a couple of babies, they’re married, and they’re working as hard as they can, and they have money saved and they want to be able to use their laptop or iPad or whatever it is to be able to fiddle with options to try and make a little extra money. Of course, I try to tell them fiddling is not the preferred word and let’s get to work. You can make some money that way, but you have to be very, very careful about what you do as part of that with money management controlling your risks. The vertical credit spread and small steps are able for that. Another thing about most of the e-mails I get from my readers- almost everybody and I think that as a society, the financial planners have taught us to think this way. Maybe they’ve heard too many bank commercials, I don’t know what it is, but people immediately start thinking in terms of making thousands of dollars over years of time. I think that doesn’t allow them the focus that they need. It’s fine to dream and have a plan, we all do it, but when you wake up in the morning and you have something in front of you that you have to deal with, investing some place, so I try to tell them just to find an easy goal. Maybe start with trying to make $50 or $100 a day or a week or whatever suits their account. That’s very doable. You can’t get up in the morning and make several hundred thousand dollars and put it away and wait 20 years to collect it. I suppose there are some ways you could do that, but for an individual investor, you have to deal with what’s in front of you. I think trying to help people focus their attention to something they can do right now to begin to achieve some of the longer-term goals is the way to go. Michael: Yeah, that’s a great point. It’s a great discussion on options there, Don, and I appreciate that feedback. Let’s just talk a little bit briefly here to talk about how you pretty much trade for a living now. Would you say that’s a fair assessment?... or professional trader? I know you trade a lot of your own money, but do you have an opinion on the stock market right now for 2016? What’s your outlook? Don: Well, it depends on what the talking heads on the network say. What’s so funny to me is that those guys can come out one day and explain a bull market and then get up the next morning, go in at 6:30, and they’re talking about the bear market that we’re in and they never bat an eye. They can change. There’s a reason for that- it’s almost impossible to forecast what the market is going to do next. I can’t do it- I’m not that good. For that reason, I choose options and I try to make my money by knowing probably ¾ guess on what’s not going to happen instead of trying to predict what is going to happen. I think my odds are a lot better. I know it’s a disappointing answer, and when they get these experts on CNBC or wherever, at the end of the interview they say, “Well, what do you think about the market?” They always have a good answer and then they back-petal a little bit. Then, when it’s all said and done, I’m thinking, “What exactly did you say?” It’s confusing to me. I can’t tell the future. All of us can connect the dots backwards, but trying to do it forward is just impossible, which we talked about the other day. Nassim Nicholas Taleb has a book called Black Swan, and it’s about improbable events. If you’re a little bit of a sophisticated investor and you love to figure the odds of investing I think it’s a must-read. It’s a really interesting book. Whether you’re an investor or not, it’s a little walk down probability and philosophical terms. Michael: I’m familiar with the book. It’s a great book for especially sophisticated investors- somebody that’s really looking to get into trading and understand the nuances of it. Your answer was not disappointing at all. In fact, the guys that say “I don’t know what the market’s going to do. Nobody knows what it’s going to do”, those are usually the guys that really know what’s going on. I like that answer. Don: It’s like you say in your new material- sometimes you can take a news event or whatever happened, whether it’s stocks or commodities, sometimes those over-reactions or under-reactions can present some great investment opportunities. Michael: I agree 100%. One of the things we like to say is, and it takes people a while to get their arms around that, because it’s almost the opposite of what everyone else is doing, but you’re saying “Look, I don’t know what the market is going to do. I’m just going to pick something I think it’s not going to do.” Once people can understand that approach, it changes their whole outlook on how they invest. Don: That’s right, and a lot of people will tell you otherwise. But by and by, just keep your boots dry. Michael: Yeah. That takes a minute to think about, but that makes a lot of sense. Going forward, I know we’re not making predictions here, but do you have any favorite sectors of stocks or commodities or anything you’re keeping an eye on for the rest of 2016? Don: Well, I think part of the new normal that is developing, and we don’t know if it’s right, hindsight or not, but I look at the individual stocks and the ones that are my favorites are not gambles on new technology, but trends because of disruptive technology. The greatest example of that right now is a stock that I own known as Amazon. To these people, there seems no end. Half of their income now is from AWS, Amazon Web Services, in this cloud computing that they’re selling. They’re not even famous for that and it’s half of their income for the company. I’ll be the first one to tell you, on our way downtown, my wife asked me the other day what I want for Father’s Day. I said, “Well, I have a few items”, and she said, “Well, I’ll take you shopping”. Immediately I’m thinking, “Whatever it is, I can get it cheaper on Amazon and have it here in 48 hours”. I’m guilty. I know people do this all the time but I’ll admit it that I walk into brick and mortar stores and I’ll find something there and I’ll just think that I can make a better deal by internet shopping. I’ve done it for years. I’ll step outside the store and get a cup of coffee, get my iPad, and I’ll order one. A lot of retailers get mad at me for saying that, but it’s just the elephant in the room- that’s what people are doing. Not in every instance, of course, there is still people who enjoy going through the deals and being able to go out, it’s a social activity. When I need something, I’m busy and I don’t want to spend 30 minutes in the car to go down and buy what little item I needed- I’ll just order it online. Again, that’s my point with disrupted technology. This is what happens for investors, too, specifically smaller investors. Maybe you and I were investors a few years ago and we didn’t have the same information the pros have, we didn’t have instant quotes, and our smart phone has more electronics in it than the Apollo 11 Moon Mission to put a man on the moon. Commissions have fallen- first it was the discount commissions, you know, Charles Schwab and those who were innovative in that area. Now, electronic trading on a portable computerized device - iPhone, iPad, Tablet, Microsoft, whatever it is – that has displaced a lot of the brokerage business. For small investors who want to use self-directed accounts, it’s a perfectly great way of doing it. Conditions are low and you have the same (virtually) news and quotes that the pros have. Of course, for high net worth investors, they have the option because of their accomplishments of being able to probably find an easier entry point by finding somebody like you guys. Michael: Well, yeah. I agree with your assessment there. Disruptive technology is really affecting almost every industry. It’s certainly a sector to keep an eye on if you’re a stock investor. Don, just on a personal note, what’s your favorite investment book? Not counting yours or mine… Don: Well, like I say, although it’s not written as an investment book, I like books like Black Swan. I’m a voracious reader and I always have 2 or 3 books going at one time. I’ve got all 3 of the Taleb books right now and I’m alternating between them. There’s such good information out there in many things. I’ll just say Black Swan for right now, it’s not the book of a lifetime, but it’s one of the books I find pertinent in the type of environment that we have to invest in. We have to be aware and keep in mind those black swans – if you’re read the book or heard those terms, those are things that seem to come out of the blue and they’re totally unexpected but they have a very profound and lasting impact on society and culture and finance and everything else. It’s a wonderful topic and it’s very interesting to explore. Michael: Absolutely. Don, how can investors buy your book? If they want to get a copy of it where can they go? Don: One word: Amazon. The quickest, fastest way to get the best price, just go to Amazon.com and you can search for Options Exposed Playbook. That’s it. Michael: Excellent. Well, Don, this has been a great interview. We really appreciate you coming on. We hope you’ll be willing to come back again sometime to give us some great information here. Don: You bet, Michael. It is a pleasure to be able to talk with you more. I appreciate the opportunity and I want to thank all of the listeners you have out there and the people who have been reading your blog. Thank you very much, good day, and I’ll see you later. Michael: Great, Don. Thank you.

OptionSellers.com
OptionSellers.com's Michael Gross and James Cordier discuss Seasonality in Commodities

OptionSellers.com

Play Episode Listen Later Mar 25, 2016 27:14


Michael: Hello everybody, this is Michael Gross of OptionSellers.com, here with James Cordier for your March Option Seller Radio Show. James, welcome to the show. James: Michael, as always, a pleasure doing this and speaking to our audience and everyone worldwide. Michael: Well, we have a lot going on in commodity markets this month. James, let’s start off with the metals markets. We are having another surge higher here as we enter into late March. What’s going on over there? James: Well, we started rallying here, over the last week or two, with negative interest rates worldwide. Certainly, both in Europe, China, and Japan the first time people have been discussing negative interest rates. That certainly gives the catalyst for investors in these parts of the world rationale to get into precious metals. Obviously, when you’re putting your money in a bank and you have to pay the bank, that certainly gets under people’s tragh, and why not look for other investments? Certainly, Michael, when interest rates are negative, people think about inflation and we haven’t seen inflation yet. It appears to be right around the corner, and that’s what gold is pointing out with this recent rally. Michael: Yeah, they’ve been interesting markets to watch. Also, over in the energy markets, a market we’ve been talking about a lot over the last couple of months – crude oil, pushing the $40 level. Where do you think we’re going from here? James: Michael, you and I talk about seasonalities, especially in crude oil and gasoline, we’ve been trading these markets for over a decade. In regards to seasonality, one of the most ideal setups right now is taking place in energy. We are looking at perfectly fairly priced oil market, based on both supply and demand. We will often see energy prices fall October, November, December, going into what we call “shoulder season”. Then we expect this seasonal rally as driving-season approaches, and that’s exactly what’s happening now. So many people are pointing toward OPEC getting together and cutting production, and, actually, this past week they didn’t do that. They simply froze production at what level? The highest level ever. Yet, crude oil rallies $15 a barrel and gasoline rallies 20%, simply on seasonalities, and I think that’s what’s going on right now. Certainly, here in the United States, we have crude oil supplies at all time highs. You have Russia, Saudi Arabia, Iraq, and Iran producing the most oil ever, and yet the market rallies. This is the power of seasonality and it’s certainly flexing it’s muscles again this year. Michael: Well, I’ll say in a big kind of way, and bringing up seasonals, this is a very active time for seasonals in commodities. We’re going to talk a lot about that today, simply because we’re entering into a time period here… April, May, where you have a lot of strong seasonality in a commodities markets. James brought a great one up, crude oil… perfect example. We also have some strong seasonals in the grain markets this time of year, and even over into softs markets in coffee. Coffee is a highly seasonal market, as well. Grown in Brazil, their seasons are opposite of ours, where we’re having spring right now they’re having autumn. James, I know coffee is one of your favorite markets to trade. What’s going on right now? First of all, let’s talk about the seasonal. What’s the typical seasonal for coffee this time of year? James: Generally, the seasonal factors have switched to demand for this time of year. Fourth quarter and first quarter, in the Western Hemisphere of course, is the largest demand season. It’s thought that people drink a lot more coffee when it’s cold, and down here in Florida, I think we drink the same amount, but certainly the populations, northeast especially, and also regions in Europe, it’s thought that someone drinks 150% of the coffee they do in the winter, versus the summer. Generally speaking, demand is largest in the United States in January, February, and March. That often kick-starts a bit of a rally in coffee prices. That’s what we’re seeing right now. Harvest in a lot of the Central American countries and Brazil, as well, isn’t in earnest at this time of the year. We’re looking at that starting in the next three to four months. Then, supply comes on at the same time that demand weakens, and that’s why this seasonal, that we’re going to talk about right now, is going to be in play probably in the next thirty to sixty days. Michael: … and that seasonal is from the seasonal charts. Looks like we get a pretty steep drop off in coffee prices, at least historically speaking. We typically see that at the end of our spring, sometime in the April-May time period. Is that a function of harvest beginning? James: That’s a function of the end of demand season and a function of the beginning of harvest season. It’s almost the perfect storm for coffee prices. Generally speaking, demand has sapped a lot of the supply once winter is over. At the same time, we’re looking at big production in most of the Central American countries. Vietnam right now is thought to be sitting on the largest stockpile of coffee ever. Brazil is going to be producing upwards of sixty million bags this coming year. Once we get past the flowering season, once the flower turns into a cherry, and once the cherry is in good shape in Brazil, you can start counting coffee bags. Right now, we’re looking at a record for 2016-2017. Seasonally, ideal situation for the market to fall off again this year, starting April and May and the low of the years, normally made in June and July, and that is something we’re certainly going to be positioning for going forward. Michael: Record crop out of Brazil is a big story. Coffee, I know, could be one interesting development here that you mentioned earlier, before we started the show here. We have report of some type of bug in the northern part of the coffee crop from Brazil. What’s going on with that? James: That is correct. Certainly, El Nino has produced certain weather conditions in coffee crop, sugar crop, cocoa crops, all around the world. The Brazilian coffee crop is no different. The regions that are experiencing this bug that’s been eating some of the berries is in the northern fringes of the coffee plantations in Brazil. It’s primarily where the Robusta coffee is produced, not the Arabica. So, it’s not so detrimental to the coffee production this year, as if it was eating the cherries on Arabica trees. It’s not doing that. So, that will dent probably a couple million bags of production in Brazil this year. Fortunately, for someone who is going to go along with this seasonal play that we are going to be doing, the Robusta crop we probably can afford to lose a couple million bags, because the Robusta is what’s grown in Vietnam, and they’re sitting on stockpiles as high as you can see. We will not be short of Robusta coffee this year. As a matter of fact, we have quite a glut. Michael: James, one thing I was thinking, as well, is you get a news story like that where the media grabs it, you bring speculators into the market. That pushes up the volatility one the options, especially the calls, wouldn’t you think? James: Exactly, that’s playing into our hands perfectly. We’ll see, in fact, if it does play out that way. Once again, just like we have seasonalities in grains here in the United Sates for planting season, there is a seasonality for coffee prices, as well. They normally have a bit of a rally in either the months of March or April. Low and behold, here we have a rally going on right now. Primarily, it’s from the dry condition in the northern parts of Brazil. Also, this bug has been hungry for cherries recently, and who can blame it. I would be too. What a beautiful cherry to ravage, and that’s what it’s doing. It looks like it’s going to possibly reduce this year’s production by a million or two bags. We don’t think that’s going to make a big difference come harvest time. Michael: And as far as strategy goes, we have a market now coming into a time where typically it has a bearish seasonal. We have somewhat bearish fundamentals, this strategy we probably look to do there would be put together some type of call selling strategy. What do you see there, James? James: Well, quite often, a lot of the markets that we’re following right now are fairly priced. However, coffee is not going to be fairly priced. We’ve been trading around 130, 133 recently. If, in fact, the market gets up to the mid to upper 130’s, possibly 140, that will be above fair price. That will be above fair value. That should spur call buyers in coffee all the way up to the $2.40-$2.50 level, practically double the price of coffee. If we time that to sell these options to expire in fall and winter, later on this year, we’re expecting coffee price to be back down to the 120-125 level. If we’re short from $2.50-$2.60 strike prices in coffee, ideal for a seasonality and ideal for option sellers over the next 30-60 days. Michael: That’s a great point, and, if you’re listening to this, coffee is a great market to trade fundamentally and one of the big advantages if you’re an options seller. If you’re trading in this market, there aren’t a lot of traders out there who understand the fundamentals behind this market. They’re trading it technically, they’re watching the news, but if you understand the fundamentals in markets, especially like these- coffee, where you don’t have a lot of mainstream media coverage, it can be an advantage to you as a trader, especially if you’re selling deep out-of-the-money options. So, that’s one of the things we try and bring you here. James, there’s a lot of seasonals this time of year. We can’t cover all of them in just this podcast, but grains are a market that has a lot of seasonals in the spring. Corn is one market that we covered earlier this month. If you got our e-mail, you get our monthly e-mails on the markets, we did feature the corn market, we’re also getting some volatility there. Let’s start off talking about corn, James. We have a seasonal, tends to go down once we hit March-April. Can you talk a little bit about that? James: You know, the seasonality for grains, corn and soybeans, grown primarily in the Midwest, here in the United States, generally we have an idea that it’s too wet, it’s too dry for planting season. It can be either delayed, it can be the ground is simply too dry from the previous year. It seems to have a rally as we go into the end of the first quarter. We’re getting a small rally right on the grain market, and that might be primarily what’s happening right there. We expect, with corn supplies at ten-year highs, we have carryover one of the highest in almost two decades. We expect corn prices to probably head back down in late spring, early summer. Certainly, with supplies as large as that, corn is going to have a difficult time reaching some of the levels that we can sell corn calls at. Any strong move to the upside here in March or April would be ideal for selling corn calls for the end of September, October time frame. That’s something we’re going to keep our eye on, certainly. As you know, Michael, the best thing about selling options on commodities, it’s purely supply and demand. There is nothing technical that creates a bull market, there’s nothing technical that creates a bear market. It’s simply having not enough of the commodity to go around, or there’s too much of the commodity to go around. That causes prices to fall. At the end of the year, the weather is not going to be an issue, the technicals are not going to be an issue, the United States is going to be flooded with Corn. That is going to be meaning lower prices and corn calls purchased by those who buy lottery tickets, as you like to describe them. I think they’re going to be throwing them out the window, because that’s what they’re going to be worth this fall. Michael: Yeah, I agree with you, James. In corn you have a market similar to coffee, where you have a strong seasonal tendency for prices start to break right into planting season. Interesting conversation this week with Jerry Toepke with Moore Research, who is going to be featured in our upcoming April issue of The Option Seller. Jerry plays a big role in building those seasonal charts we all see online. We were talking about the corn market and corn’s one of those markets where, just as you mentioned, sometimes you get some anxiety building up to planting season. Once the crop starts going into the ground, corn tends to go in a little bit earlier than soybeans, they tend to finish up a little bit earlier than soybeans. That anxiety starts coming out of the market, price starts to break. So, you have a strong seasonal tendency for this to happen, and we also have, on top of that, some bearish fundamentals. It’s hard to state them any other way. You have corn stocks at 10 year highs- 1.8+ billion bushels. Planting intentions are expected to be 2 million acres higher this year than they were last year. At the same time, we have some things putting a little bit of volatility into the market. You have the anxiety over planning coming up, there’s some talk of some wetter soil levels in southern growing regions, and we also have the USDA planting intentions report that comes up on March 31st. We’ll get a little bit more refined picture of what planting is expected to be this year. Right now, they’re expecting it to be higher over last. Two things- you have bearish fundamentals and a bearish seasonal, so any one of those things that brings more volatility pushes call prices up, unless there’s some type of real challenge to planting this year. I agree, I think we’re going to have some great call selling opportunities there. It’s a market to watch. James: It sounds as though we’re piling in on corn, but the fundamentals don’t lie- the numbers are true. Any excitement or pandemonium over weather conditions this spring is going to create a great selling opportunity. Hopefully, we get that excitement in volatility, and, if we do, laying out calls is going to work real well, I think. Michael: Yeah, I think so, and soybeans are in the same boat to a certain degree. We’re going to be talking about them later in April. The point there is they’re a great time to trade grains this time of year, certainly a market to keep an eye on. As I mentioned, coming up in the April newsletter, you will hear my interview with Jerry Toepke of Moore Research- some great insights into seasonals. We’re also going to be featuring the coffee market, one James just talked about here, spell that out a little bit, and show you a strategy you can potentially use there, depending on where we go. While we’re talking about seasonals, James, I thought we’d go ahead and move in and talk a little bit more about how traders can use seasonals, because I’m sure a lot of people listening they’re saying “What are seasonals? I’ve heard of them. Maybe I’ve never heard of them at all”. In commodities, there are seasonal tendencies of certain markets. It’s not guaranteed, but they can be a powerful tool to use, and we use them here extensively. I think they are a very important part. James, maybe it would help some of our listeners if you talked to them a little bit about how you use seasonals. What’s the type of thing you look for in a seasonal chart when you’re looking at these things? James: Michael, quite often, commodities are fairly priced. Each day, when the bell rings on the exchange floor in New York and Chicago, the price of corn, the price of coffee, the price of gold, trades at exactly the level it’s supposed to be. Fair value. We decide that by auction, open outcry, that anyone can vote on at the end of the day, and that is where the market settles each day. For certain reasons, technical trading takes place, speculators get into the market, sometimes it’s fundamental selling or buying. The idea of trading seasonally is it reverses what inevitably is an incorrect rating. In other words, the market is falling in crude oil again this year. We are sitting at $27-$28 a barrel January and February, and everyone in the world is betting that oil is now going to $20 a barrel. Watching CNBC, watching Bloomberg, watching Fox, one talking head after the other is talking about $20 oil, $18 oil, $10 oil. That sets up the perfect seasonality for what we do. Going into January and February is when supplies are at the largest and when demand is at the least. Low and behold, what do you do? You start selling puts for the June-July time frame. Why? Because the seasonality kicks in in March and April in the United States, and that is when the beginning of driving-season happens. Seasonality allows you to define how you should be positioning yourself in the market. You don’t listen to the noise trading seasonally, you don’t get excited when the market’s at it’s high, you don’t get scared when it gets to the low. It gives you the intestinal fortitude to trade commodities, and if you allow the 82% of the time when options expire worthless, that gives you the rationale for getting yourself in the market when listening to the pundits on TV would make you fearful of doing so. Seasonality gives you guts that you need, seasonality gives you the idea that, in fact, the market is eventually going to come around to your thinking, it gives you the timing that’s needed. Trading commodities, even though we don’t need great timing selling options, it’s just one more piece to the puzzle to put the odds in our favor, in my opinion. Michael: Yeah, that’s a good point. It’s one piece in the puzzle, and, if you’re thinking about trading seasonally, these can be a powerful tool, but you can’t just look at them and use them in a vacuum. One of the things you have to understand about seasonals is there are fundamentals that tend to cause these seasonals every year. They don’t just happen on their own. So, if you can look at the seasonal that will reflect it, but to really get the most value out of it you have to understand the fundamentals behind that seasonal. James, I know one thing you do is you keep an eye on and monitor those fundamentals. Are they happening the same way they tend to happen each year? What’s different? You brought up a good point about coffee- there’s a bug in the crop. Could that have an impact that could override to seasonal? Right now we’re thinking no, but it’s still something that you have to keep an eye on, you have to understand what’s driving that seasonal to really get the most out of it. The seasonal is really reflecting what’s going on under the surface. Do you agree with that? James: Michael, we follow around 8 or 10 commodities. As seasonals start approaching, we do nothing but analyze fundamentals, we research what the fundamentals are. Quite often, going into a seasonal period, the fundamentals will be, once again, fairly valuing the particular commodity. Certainly, when oil made a low in January and February this year, there was every reason to be bearish on the market. The thing is, we go from the least demand period to the highest demand period in a very short period of time at the very beginning of each year in the United States. We go from the smallest amount of demand of energy to the largest amount of energy usage from January to April- very short period of time. The fact that we’re trading options on futures, the market doesn’t wait for that demand to increase. It expects it to. Low and behold, April, May, and June, people start driving their automobiles, and demand goes up from 20-30%. This is what spurs this seasonal to work. It is a fundamental factor that makes the market go. Knowing these seasonals in advance allows you to get in when everyone’s selling, get short when everyone’s buying, and that’s what makes this just a great piece to the puzzle… utilizing seasonality and adding it to your option selling. Michael: And as an option seller, if you are selling options, the reason we stress them so much is they’re almost a custom made tool for this type of strategy. It used to be, 10-20 years ago, there was a lot of talk about seasonals and commodities. The way people would try and trade them was “Well, let’s see. The chart here says the seasonal falls on April 20th, so we sell it on April 20th, and we buy it on June 1st, and that’s worth 12 of the last 15 years”. So, they go and do that. Low and behold, the thing goes up and they lose. So, the thought process is “Well, seasonals are no good. These things don’t work”. What people don’t understand is these are merely reflecting averages. It doesn’t mean it’s going to fall right on that day. It might not fall at all. The key thing as an option seller is you don’t have to be guessing what the market’s going to do on a daily basis. All you need is that general, typical price trend that you can look at, and then sell deep, out-of-the-money options, way above or way below it. So, even if it doesn’t happen at all or you missed it by a week or three weeks or a month, as an option seller you have so much room to be wrong that you can still end up profiting from it at the end of the day. I know that’s something we try and look for a lot of the time in our trading. James: Michael, whether our audience today is selling options for themselves or they’re considering selling options with us, or they already are, fundamental analysis on the grain market, the softs market, the energy market, it’s available to anyone. All you have to do is go online, you can find out what the supplies are, you can find out what the trends are in production. Make sure, going into a seasonality, that everything is neutral. Make sure that there’s not an underlining factor that’s going to cause the market to not trade seasonally. It’s something that we work on all the time. Our listeners who possibly are selling options on their own, you can do the same thing. Don’t simply look at a seasonal chart. Do the fundamental analysis prior to getting into the market. That’s going to put the odds in your favor, something we’re always stressing. It’s not that tough to do. Michael: For those of you who’d like to learn more about seasonals, we do cover them extensively in our book, The Complete Guide to Option Selling, 3rd Edition. They are a big component of selling options on commodities, if that’s an investment you’re looking at getting into on your own. Obviously, for our clients here, we monitor and do that for them. Speaking of, we do have some consultation dates still open for April for anybody interested in possibly talking about an account. Feel free to call Rosemary at the 800 number: 800-346-1949. She’ll let you know what we have left available in April. James, I know you have another video coming up this month. Is that correct? James: We’re going to be talking about one of our most near and dear commodities, KC, also known as coffee, probably one of the best seasonalities available in all of the market. I’d compared it to the seasonality in energy. Supplies in coffee going forward are going to be heavy to the market, and this rally that we’re getting right now in March and April, I think, is going to set up, ideally, for seasonal call selling. So, that’s something we should probably hit in this video and get everyone very well on board as this trade approaches in the next 2-4 weeks. Michael: Yeah, that will be a great video. I know we’ve gotten some e-mails and people are certainly interested in what we’re doing in metals. We’ve been mining a lot of premium there in the gold and silver markets, and I’m sure you’ll be talking about that, too, possibly in the upcoming video. That will be before the end of March. You can look for that in your e-mail box. You can also be looking for the Option Seller Newsletter. It should be to you sometime within the first couple days of April. I appreciate everybody listening today. I hope you found this podcast on seasonal tendencies interesting. As always, feel free to give us a call. If you’d like to learn more information, get a discovery pack, you can also find us online at OptionSellers.com. Thanks for listening, everybody, and have a great month of trading.

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OptionSellers.com's Michael Gross interviews CNBC's "Dr. J" Jon Najarian on Selling options, fear in the stock market and trading outlook for 2016

OptionSellers.com

Play Episode Listen Later Jan 21, 2016 35:12


Michael: Hello readers and listeners, this is Michael Gross of optionsellers.com, I have a very special guest for you today. Today we have with us John “Dr. J” Najarian, for any of you that watch CNBC you’ll see Jon on Closing Bell and also as a feature trader on Half Time Report. He’s also co-author with his brother Pete of the book “How We Trade Options”, he’s co-founder of optionmonster.com and trademonster.com. For those of you who don’t know John he was a floor trader at the CBOE for 23 years before founding these enterprises. For those of you that trade stock options, Jon has some deep insight into that form of trading he’s going to share with some of those with us today. John welcome to optionsellers.com, guest expert series. John: Well it’s my pleasure Michael, thank you very much for having me. Michael: Sure, John you’ve got a pretty rich background in the industry, one thing many of our listeners might not know is that your resume includes a job as a linebacker with the Chicago Bears. Can you tell us a little bit about that and how you got started with your career in trading? John: Sure, well I was lucky enough back in 1981 to come out of college and go right to the Chicago Bears, and unfortunately even though I picked a good team I think too, – because I was a free agent, I was not drafted – so it was my choice because several teams had contacted me Michael, and the Bears looked like they were probably my best chance. So I went there but unfortunately Michael Singletary ended up being a number two pick that year and obviously a future Hall-of-Famer, it was not long before they figured out that they’d rather have him at middle linebacker than me. So at least it got me to Chicago and that’s what I always thank Mike Singletary about. Michael: That’s some pretty tough competition. John: Yup it is, and he’s a really tough guy and a good guy, so my mother is the only one that resents him. I instead admire him, and I'm sure if my mom had met him she’d admire him too. Michael: Okay, so you were in Chicago and then you ended up on the floor of the CBOE, can you tell us how that got started and what you did there? John: Sure, basically my agent was a trader and a money manager, and he was on the floor of the Chicago Board Option Exchange, managing money for clients. And when he asked me what I was going to do, and I told him that I thought I’d go into the markets, from being around so many interesting people up at our training camp. Bears training camp at that time was up at Lake Forrest, a suburb on the northern edge of Chicago. So he said “well if you’re even interested in that, you’d much rather be on the floor John, trust me”, so he gave me a job and I did that with him for about six months and worked with another trader for about six months, and then went off and started trading my own money out on the floor. Michael: Wow that’s a great story, now when you first started trading Jon, were you trading options, were you trading or were you selling options, were you buying options, what type of trading were you doing? John: Basically as a market maker, so I would have to do both, buy and sell, but I was primarily I guess a premium buyer. Because most traders you will find that are on the floor end up having long premium positions I think, but the primary reason is that they’re scalping throughout the trading day. In other words that long gamut, the fact that you’re long on option contracts, and that it gets longer as it goes higher, and shorter as you go down, means that scalping can be a very lucrative way to make a living. So basically scalping gamma is what most traders do, and obviously the further you get from the trading floor, the more it favors the strategy like what you guys do where you’re and options seller rather than an options buyer. Because a combination of people just don’t have a full time access to the markets like a floor trader does, and the time decay can just eat you up as an off floor trader that trades a couple times a day or a couple times a week or a couple times a month. That’s different from a floor trader who probably trades hundreds of times per day. So again I think the closer you are to the pits and being in there and trading, the more likely you are to be a long gamma trader, and the further you are – more upstairs, which is what I am now like you Michael – the more you are an options seller I think. Michael: Well that’s a great observation. In your opinion John is there still as much activity on the floor or is most of this going online now? John: Of course the volumes show up attributed to a floor, but most of the volume really occurs down in the data centers of Mahwah New Jersey, Carteret New Jersey, Chicago or wherever, in other words at the CME or at the CBOE, at Arca, wherever it might be. The traders are still on the floor but most of the volume is really transacted by people on computer via remote, so long winded explanation I guess, most of the volumes coming in trading electronically rather than in open outcry in the pits. Michael: Okay I'm sure a lot of our listeners and readers are interested to hear that because we do get a lot of questions of “is floor trading what it used to be”, you read a lot now about things going online and a lot of people are curious about that. John, so you spent a lot of time with the CBOE, 23 years, you eventually went on to found trade monster and option monster, and trade monster recently rated best for option traders by Barons. Can you tell us a little bit about those two enterprises, who they’re for and what they offer to investors? John: Sure, well the trade monster was something that my brother Pete and I created to be an online trading platform similar to offering over at Pinker Slim or Charles Schwab with their option express purchase. So we basically sought out to create a venue for people to give them a lot of tools so that they could trade using various types of analysis of both options and stocks, and technical analysis for charts and all the rest on one platform, so that they wouldn’t have to download something. They could just use it as a web based service from wherever they were on mobile or sitting at a desktop. So we did that, and that became known as trade monster. Then we did a deal with a private equity firm a year ago, that private equity firm bought a majority of the firm from us. And we immediately rolled up another firm and now call it Options House. So options plural, house, that’s our technology on that much bigger and much more widely distributed trading platform. Michael: Okay so options house is based primarily on technology that you’ve developed or you and your team have developed? John: Yes exactly, we developed the technology and the tools to both analyze trades and for investors to be able to see where the heat was. We can’t really redistribute the heat seekers that we do because the bandwidth it requires is just too large, so instead we give a slimmed down version for free to many of the clients of Options House so that they can see where there are unusual calls or push. And many times those are signals that somebody is getting involved, somebody’s buying and is establishing {unintelligible 12:22-12:24} that particular equity. Michael: Okay, Jon now you’ve also authored a book with your brother Pete called “How We Trade Options”, and that’s based on your experience on trading stock options. I know one of your key concepts is looking for options with unusual activity. Can you explain what that means and talk a little about the approach you recommend taking in the book? John: Sure, well we start to give a basic primer if you will Michael for people understanding how options work and then how they could apply various strategies to either enhance yield for selling options for instance against stocks that they own, or to instead of investing in stocks at all, perhaps stimulating a long position through the use of options, either buying in deeper in the money call or a lead, or by putting in a call vertical spread, a one by one spread, they can simulate the long stock that have far less risk than the open ended down side of purchasing Chipotle or Apple or any of the other high fliers that people tend to want to trade. But could have a considerable downside if there is a negative event that impacts both stocks like of course this just happened over the last month or so in Chipotle. Michael: Okay so a lot of the strategies you’re looking at are what some people call synthetic positions? Is that – am I on the right track there, or am I off somewhere else? John: You sure are, no you guys know your options, so I'm not going to correct you Michael, you’re exactly right. Many of these synthetics are ways that people are getting long and expressing that bullish outlook – or short – for instance right now because of some of the things that I've seen in the market, I am long a lot on put spreads in the Spider, the SPY. And I expressed that bearish position not by shorting but by owning the put at for instance the 205 strike and being short of goods at the 195 strike in the SPY therefore putting on a position whereby I make money if the market drops and you know `that kind of spread, that vertical spread is the way that I probably trade 70% of the time either being bullish or bearish through calls Michael: Ok. Excellent I’m sure a lot of our listeners will certainly understand what you’re doing there. John many of our listeners here either trade or are interested in both stock and commodities options; however many of the option strategies are the same. Do you have any individual option strategies other than- I know you said your favorite here is the vertical type of long spreads, any other strategies that you favor that you like that you would recommend to investors? John: Well I think for investors that are just learning the course many of them will be better served since they probably own stocks learning about the writing of calls- covered calls against stocks that they own. And then perhaps as they're learning about options eventually they’ll want to understand insurance which is of course a good option collecting a premium for a call can help offset some of the pain that you feel if the market moves to the downside but it can only provide the perfection up to that premium that you've collected so I think the next step is that people tend to understand putting on a put versus their stock and then perhaps writing a call against it and that's something that traders refer to as Callers? And that's a very popular way for people to invest because it can really cut off at downside risk of owning upstart through that put option and then hopefully pay for it by selling them upside call the truncate are upside but it seems like a reasonable trade-off to most of us when you see some of the rapid decline that we’ve seen in 2015 I can’t remember a year where we've seen more of these Michael. Michael: Well that's an interesting observation. I'm going to ask you something, shift gears here a little bit John; many of our listeners, readers here, they've read our book: The Complete Guide to Option Selling some of them sell options on commodities, a lot of them sell stock options. One of the tenets that we always preach is hey look this isn’t the only way to trade options... there's hundreds of ways you can trade options this is one way that works for us it's what we recommend. Obviously you have some ways that work for you; what’s your opinion of selling options as a strategy and do you use the strategy at all in your trading? John: I use it all the time in my trading, I would say that for our clients over on the wealth management side in particular for foundations and endowments and thing, that’s why people come to us; they want somebody to prudently manage a covered write or an option overwrite and I think that’s the same sort of appeal that you guys in your department have Michael is that people seek that additional yield and one of the ways that you can do it most on efficiency- efficiently rather, is through those option strategies; listed options, prices every night there’s nothing over the counter that is in our portfolios for folks just basically writing listed options form or in some cases options that are created select options where you can basically call strike price for American or European exercise and all that sort of thing that's extremely popular for us with the larger accounts that we do because you're not necessarily impacting the market the same way as if you tried to go in and basically put a market in between the bid and the offer or something like that, you’re asking for a quote for specific strategy and most of those big trading desks are more than willing to accommodate that. Michael: Ok, now these strategies when you’re-- when you are doing these rights for clients, these are equity options these are stock options. Is that correct? John: That's correct, yeah. They are equity options that we're establishing for those clients. Michael: And these are primarily clients that are – are they just looking for high returns or they hedging other portfolios- or what’s their primary draw? John: On the wealth management side, they tend to be either like I say pensions, endowments... foundation and things like that when they have their own portfolio of stocks they haven’t asked us to pick those and instead we are putting on positions for them to enhance the yield and/or to cut the risk of owning what they own and that's probably 60/70% of our business. The rest is for us to {inaudible} put stock and/or ETF and then put on the protected strategies or enhance yield around a particular portfolio that we have selected. So we do it either way {inaudible} goes 'cause they have already put on their stocks or we will be happy to set what we think is a representative portfolio that hopefully outperforms the broader market. We have someone within capital this past year, created a unit investment trust that either people buy as an investment trust or UIT or you can either buy stocks without that unit investment trust {inaudible} depending on the portfolio they pick and then we'll do overwrites or call {inaudible} to come enhance that Michael: okay that does sound like some complex strategies that you’re obviously very good at and it’s very interesting to hear how you’re doing it because we were we just do the commodities on this side and hearing what the you’re doing with the equities is - sure be fascinating to a lot of our listeners. John: cool. Well Thank you. Michael: Sure... John I’m going to shift gears here just for a minute and ask you about some your views of the market and the world right now. There seems to be a lot of anxiety about the state of the world, the markets as of late; are you seeing that reflected in stock option values you follow, the Vicks, those types of things? John: We absolutely are seeing that risk or that fear and you can smell it. When you've been in this as long as I have you definitely can smell it. Here is something that is either fear or greed that are the 2 primary drivers and the greed you can tell by how euphoric voices sound when you're on a trading floor, you can probably even tell it when you're watching some of the talking heads on TV discussing various stocks and how the market reaction, for instance, after the jobs report we saw just a dramatic jump to November jobs report- reported on I believe December 4th or 5th. You saw Mario Grogey come on and explain that the market's up a hundred, 200 points, 300 points, nearly 400 points on the day; that kind of euphoric buying is that greed that I’m speaking up and also sent it downside; and you have a 200 point sell off and you are definitely hearing more of the fear in that trade and with the commodity meltdown that is going on and most of 2015 you can certainly see why at the end of the year we've seen a lot of tax lost harvesting at the end of the year. Michael: OK, that’s fascinating you- I'm probably kind of guessing that your answer to this based on your- when you were talking about writing put spreads earlier but as far as your thoughts on the market for 2016 I know no one can predict the future but do you have an Outlook right now? John: Well overall I think that again, we're sort of lucky on one side that the prices had come down and since crude oil which almost everybody - in one way or another - a Tesla driver probably impacted a little in a positive way by lower energy prices; whether it's the energy to basically power that Tesla by plugging it in or the natural gas in their homes or whatever it might be. Crude oil as a form of eating oil on the East Coast, any of these are imports that are less in 2015 than they were in 2016 and that number has basically still dropped throughout the year... and I believe we're at almost half the United States 24 stock- of 24 States where gasoline is less than 2 dollars a gallon. I think that's a positive I think some of the negative impacts to stocks and stock market will be mitigated by the fact that less participation as I said think we said earlier in the broadcast that these energy stocks are now only about six and a half percent of the SEP 500 previously they were closer to 15% so they've been cut in half their impact on the SEP. So some of the downward pulls that those {inaudible} prices have on the economy or at least on the stock market I think will be lessened just because of that percentage of the SEP 500 that is in load stock and represented by those stocks; on the other hand, everybody from Amazon, people from UPS or whomever is delivering packages I keep seeing a positive from these energy prices being cheaper. I think that one of the dangers in the early part of next year, 2015 is that if Grogey and the ECB move too quickly to increase the equity and basically increase their buying European gas that we can see a dramatic drop in the value of the Euro, it would correspond to of course the big rise in the dollar. I think they're going to be very measured about the way they do that, 'cause as I said everything's going to be measured in the way that the moved rate goes on our side of the globe. So if I’m right about then I think these 2 factors could be much less of a negative impact on US stocks and on our market and the outlier which is if either go up faster on our side than anticipated Again I think that a 20% chance not an 80% chance and I think that Grogey is 80% chance to move slowly and measured with the increases to quantitative using overseas. So in other words my overall outlook is that the market grade is higher although probably only 5 or 6% higher in 26 weeks and I think given that he has said there'll be a fire of European debt through March of 2017 means it should not really be much of a paper roll for their overseas until the end of next year; so again I think all that we will likely see equity prices higher without too much of a drag from either [[28:00]] {inaudible} quantitative using here which too fast of or the acceleration which key fast of quantitative using over there Michael: OK. Now you mentioned earlier that you had some long put spreads on, are you more bearish in the short term and bullish in a longer-term or what- okay John: that’s exactly it. I am not necessarily off bearish but I wanted to vote-- most time Michael when I get here the same if I’m talking about what people quote unquote should do I’m probably doing that. I’m not one of those guys that says 'Oh you guys should do this' but I'm doing the opposite. Michael: sure John: but for my account and for my clients we are protecting portfolios and we're only put and/or volatility and there's a way to do both with the Spider I think. I literally preyed the volatility EPS because I think they’re very inefficient in how they express my view. I would rather say if I think volatility is going to move up that means 99 times out of 100 the market is going to go down. Given that I’d rather have a put spread like the one I described earlier - the 205 195 that $10 put spread I'd much rather have that on than I would buy a bunch of VXX or VXY or any of the EPS that allegedly cracks the volatility because I found that those are inefficient ways to prey because the other just sprayed out access to the short side of the market through a Spider or an SPY put spread is a much more efficient way for them to express that same opinion that I have so that’s why I’m more likely to do that. Michael: Ok. John it's refreshing to hear your Outlook as compared to-- not a lot of analysts in people that discuss the market seldom have extreme views right now. You seem to have a very measured reasonable view of the markets and going forward 2016. Do you have any favorite stocks or sectors that you think might be better than others in the upcoming year? John: Well I’ve got to think that many of the sectors that people can get exposed to either stocks or commodities playing right into your strength. I think these guys -- I think commodities can't and I mean cannot be as big a problem for the market in 2016 as they have been in 2015. I can’t imagine that we're going to see copper for instances that basically are down to $2 and change have a similar fall in 2016. Nor can I see crude oil down from the 60s into the 50s into the 40s and now in the $37 range; I can't see a similar percentage drop there. I just really can't. I think there's just too many other factor that would be to have a man slack dramatically to have either of those have as big an impact as a negative impact on the media in those sectors or on the support mechanisms for them. Support meaning like Caterpillar, for instance, for like Acres News or Slumber Jays depending on if we're talking about mining or going global. We're talking about crude oil and extraction or exploration of natural gas and crude oil. I can't imagine the same sort of negative pull there so those two sectors mining oil and gas, those two sectors would be what I would have in focus. I think that the early part of next year, technology will probably be a significant driver; something that will unfortunately commodities probably don't give you as much access to but I think the rest of the year could be pretty significantly impacted by a turnaround in commodity prices even if it's not a dramatic move to the upside, even if it’s just stabilization I think that's going to be something that happens in 2016. Michael: Yeah that's a great point and maybe one that not a lot of traditional investors get is when you're over on the option side you don’t necessarily need to be outright bullish marketer, guns blazing bullish or even guns blazing bearish just maybe you’re not so bearish on something. There’s an option strategy that you can take advantage of that viewpoint. It doesn’t have to be outright black or white and I’m sure you’re very familiar with that, in fact some of the strategies you just discussed target exactly that. John: Yup. That’s right. I think doing what you and I do Michael gives an investor some confidence that they can own a particular asset, commodity asset or stock exchange created asset and there are ways that you can protect it from the downside, because the world really is about risk versus reward; how much risk am I willing to take for that additional reward? And if the reward is too small for the risk, then I think that's not really an asset that I want to own. On the other hand if I could either do a bearish expression or bullish, have exposure to the market that's exactly what these products are so good at and why I want to be in them. Michael: Excellent and just to quick summarize John and correct me if I’m wrong but just to summarize some of the things you've said, your bullish tech early on 2016 as far as sectors you're leaning towards 2016. You think the mining and energy sectors may not be all out bullish but you think the downside could be somewhat limited in 2016? Did I get that right, was it mining and energies? John: Yup. You're spot on. I think just to summarize technology I believe leads out of the gate in 2016 but by the end of the year the commodities will have their day again and that many of the prices that we'll see as tax loss selling carries us into the end of 2015 people will see gains from those levels by the second half or maybe even before that of 2016 and some of these will be silly how cheap they will have looked in hind sight. Michael: That’s a great point. John I know you’re not a commodities guy per se but you do follow obviously have to follow world asset prices oil certainly something I know you’re familiar with, do you know of-- I know you talked a little bit about this earlier as far as oil goes we just had OPEC come out and they are not going to cut production in the near term, do you have an opinion on that right now? Do you see us heading to a major bottom here over the next 1 to 2 months early 2016 here or do you see things leveling out? Or what's kind of your gut feeling right now? John: Yeah I do, I think that the-- I think overall we will but I don’t know that it's a V-shaped bottom so that’s why I said that I don’t think the first half of 2016 is necessarily off to the races for those sectors {inaudible} I think it’ll take a little while to that mindset and to that pain to be-- fall out of people's minds; but then at some point greed will kick in when they realize that enough production has come off-line in the way that we've seen rig-counts coming down every week now. Early in 2015 Michael they were coming down 23 straight weeks then as commodity prices and energy states rebounded, we saw them build back up. It never got to where they were in 2014 but they nonetheless build back up and now they've been leading off to the last 2 almost 3 months every single week. I think that continues and that cutback of that swing delivery of energies will be one of the reasons that we actually see prices move up. Michael: Ok, case of low prices curing low prices. John: Yup Michael: John this has been some great information and everybody listening out there I'm sure you probably want to go back through and listen to this again or read it John has really given you some great strategies here, some great insight into the markets. John if investors want to learn more about you, your strategies, your firm, where do you recommend that they go? John: Well if they could go to optionmonster.com or howwetradeoptions.com either of those two sites they could learn a lot more about it and have some pretty good free tools available to them as well... Michael: Perfect. That’s optionmonster.com and howwetradeoptions.com. John- John: Well thank you Michael it's been a pleasure. Michael: thank you John it’s been some great information we're glad to have you hopefully you'd like to come back again sometime and- John: I’m sure I would. Michael: It's been a pleasure to have you, I'm going to stop the recording here at this point John: Ok.

Round Table 圆桌议事
【文稿】抢老板红包需谨慎!

Round Table 圆桌议事

Play Episode Listen Later Jan 16, 2016 6:18


【特别感谢热心听友 畅畅(张梦珂)kara 帮忙听写本篇文稿】HY: During working hours, you are checking your Wechat updates, suddenly, you realize your boss is giving outHongBaos or red envelopes on Wechat, should you grab it or not? If you do, you are busted!What’s going on here, guys?Michael: Well, ok, so it’s probably important to put into some sort of context, so if you not familiar with the Wechat messaging app,there is a featureon therecalled lucky money which allows you to send a certain usually quiet small amount of money anonymously otherwise to certain groups people or to anybody you like in youraddressbook and what one particular boss decided he would do just to check if everyone was observing the no cellphone policy that he’dinitiated, he decided to send one of these red envelopes, I think the amount of each one contains was less than 20yuan sort about 3 dollars it’s nothing at all really.HY: So greedy you!Michael: Well well, the point is that when you’re opening the envelope, I don’t think you can see how much is actually in it until you open it, so it could be, you know,HY:It adds to the thrill!Michael: Exactly, it could be a fairly substantialamount of money, and so he thought he would send red envelope to all of his employees to see, you know, who would open it and who would therefore obviously be deemed to have been using their cellphone during work hours and therefore be violating company policy. So the first three employees who opens their Hongbao, he actually fined them 500yuan, so it certainly wasn’t worth the 20yuan that was in the envelope in the first place.LY: Well, my viewpoint is quiet simple, what the boss had done is just disgusting.HY: Strong language!LY: This is not the first time this boss gave red envelope out in the Wechat group, but originally, he used to do this during work break or after work and to some extent, you know, this is customer experience or behavior this boss has alreadynurturedthe habit of grabbing the red envelope and all of sudden, you send out these red envelope people has natural instinct to grab instantly right? And also, how can he categorize people into different groups just for the three top performers of grabbing the envelope they are fined for 500kuai, but what about the remaining people, they also , you know ,grab the red envelope during the work time and you didn’t give them a penalty and this is just unfair .HY: Haha, it’s unfair.LY: It’s reasonable.HY: Ok,all right,well , yeah. I guess the boss is basically setting up a trap (L: Yeah,it’s a trap) and see who falls into itand asking money of his employees for this reason. This is a cheapskate, I think.Michael: I think it’s devious and entrapment and also I think it is also quite creative. I mean, it is important to consider here. Ok , he implemented this no cellphone rule, and we are talking about a petrol company here so there is obviously there is alegitimately safety aspect to not using your phone when you around , you know,petrol and flammable substance.HY: Because an explosion might happen because they are looking at theirWechat.LY: I don’t buy this excuse, because they are not standing on an oil tanks or pipes of petrol chemicals, they are sitting in their office with their pc in front of them.Michael: Well, regardless of this, he’s obviously implemented this no cellphone rule andI dare say if other employees got wind of this particular punishment then I dare say a lot of people would think twice about using their cellphone in the work time in the future, so I think there are some merits to it.HY: You think some merits to it and whileLuoyu call that boss disgusting, so no no for Luoyu.And guys,do you think checking your Wechat account and ,you know, social media updates, has that really become one of the major distractions that significantly impedes people’s productivity these days?Michael: I would say yes,It has, actually.HY: It’s really that bad?Michael: I would say so. I mean, in the UK where I’m from, you see a lot of companies implementing no social media rules in their work contacts, some things like them, in fact, some companies block out them entirely so they block out all these social networks like facebook, twitter, you simply just can’t accessthem from your work computer, so yeah, it’s become a big thing in the last few years. Personally, I think as long as you using it sort of sparingly or using it during your lunch break, it’s really does not do any harm, but I can see why employers might be in attempt to ,you know, to trying to root that sort of thing out.LY: Well, if you tend to use mobile’s app too often, it’s a major source of distraction and you couldn’t concentrate very well on your work. However, the reality here in china Is that, you know, Wechat is just prevalent and sometimes,it’s quiet convenient to establish a Wechat group where you can discuss and communicate with your co-workers.HY: Yeah, and you guys seem to say that it’s a pretty good idea to use it at work at least for the group chat, at least the whole team, In theory, everybody will get the same message. But however, as aforceduser of group Wechat as I usually stay in my cave but in this situation, because I work here and I am ordered to get out of the cave and get into that group, and I don’t find it all that useful and especially when you’recommunicating slightly more complicated ideas.Let’s say when we are trying toinitiate new ideas for a new project and it is a mess on that group’s chat log. And I don’t find that useful at all. Nobody really communicates their idea thoroughly and there are just too many of people leavingthis and thatmessages and it becomes confusing and who has the time to check all of those things.Michael: I do find it very annoying when my colleagues write in Chinese and I can’t understand it.I will say that.HY: Maybe some people are doing that on purpose~

Round Table 圆桌议事
[有文稿]男人每个月总有那么几天......

Round Table 圆桌议事

Play Episode Listen Later Dec 2, 2015 7:02


Heyang: A British study says a quarter of English men believe that they experience a monthly &`&man period&`&. Meanwhile, a more shocking statistic show that 58% of their female partners believe in them. Really? 英国一项调查显示,四分之一的男性认为自己每个月都会有特定的“大姨夫”时期,在这段时间内他们会觉得非常疲劳、烦躁、嗜吃和容易烦恼,症状类似于女性的“经前综合征”。男士们真的会有大姨夫吗?This is a bit of delicate subject to discuss with two gentlemen. And I suppose as the lady here I will take the liberty of explaining the term 大姨妈 or “periods”. So basically in Chinese it’s quite funny. Translated into English it literally means “big aunty”. Laiming: I think they have the same description in English for period. HY: “Big aunty”? LM: Yes. I’ve seen it in a TV series. Michael: Have you? All right, I haven’t. HY: Maybe you are not paying attention to such delicate matters. Michael: Maybe we are watching different shows. HY: It makes all sense in Chinese to translate this “man period” into 大姨夫, the husband of “big aunty”. So now you know what it is. And it’s super inconvenient, can be really painful and women hate it. Oh, and also it’s sort of like a privilege for ladies you go through that difficult period. LM: It’s just unfair. It’s your privilege? HY: In a way yes. And now men are actually competing with women and saying that they have this problem too. Physically do you? Do you? Do you?(重要的事情说三遍) No! So what’s the point here? Do you guys have this problem? Michael: I even haven’t come across the expression or indeed the notion of a “man period” before, no, Heyang. This is new to me. HY: This is new to you, all right. LM: Physically bleeding, it will never happen to you, but how about the mentality that psychological stuff? HY: Oh, guys, guys! Let’s not get so graphic about it. LM: Do you get cranky or irritable sometimes? Michael: Well, yes but I don’t think that has to do with any sort of menstrual cycle or otherwise. HY: Ok, I think maybe this is pointing at a hormone fluctuation that maybe men experience more or less similar to what women feel. So we are not talking about the physical side of things but more of the psychological side of things. So guys, do you feel that every month there’s a few days you feel cranky, you feel grumpy, you feel unhappy, unsatisfied, you wanna eat a lot and you just hate people around you. Do you feel that? Michael: I feel that all the time Heyang. That’s my default setting. HY: What about you Laiming? LM: So you are always on大姨夫. Well it seems I have a better control of my emotion. And since I’ve got married, my wife has offered me this valuable lesson about this other dimension about this world that is emotional dimension. So I began to realize that our emotions fluctuate through time. And I came to pay attention to these small changes in the state of mind especially. The way I realize that I have this kind of problem is when I get on public transport, for example a bus, when sometimes people don’t queue up, I from time to time will feel irritated. But I don’t always feel irritated. Michael: Now I feel irritated all the time when I see that. But because I’m British, I don’t do, I just sort of stand there and maybe tut and shake my head to myself. But I won’t do anything more than that. But I wonder if maybe men are sort of cashing in on this a little bit. HY: Aren’t you guys doing that? Michael: This happens obviously every four weeks or so with women and as you explained Heyang, it’s very uncomfortable and unpleasant. As a result, you might feel a bit irritable and cranky. And maybe in some cases men have seeing that every four weeks or so, women almost have this of a free pass to be as irritable and cranky as they like. Maybe men are just thinking actually well maybe... LM: I can be cranky and irritable every time every day! Michael: Yeah. LM: It doesn’t have to be during period. HY: Oh, guys, guys! Now you are wondering why women turn into 女汉子. So women become a little bit more… LM: Masculine? HY: No, it’s like masculine in behavior as if women feel that we need to shoulder more responsibility, you cannot rely on men, you have to just do it yourself. Michael: I’m a strong independent woman. HY: Because look at the guys! The guys are demanding privilege from men period! No wonder we are being push to the other end of, I don’t even know what this is, but just pushing us to the opposite end. LM: Don’t you just sympathize with people who don’t pay attention to their emotional wellbeing? I remember talking with one of our colleagues who is from Sri Lanka, who pays a lot of attention to her psychological wellbeing. She said a very famous quote I would like to say on this show. She said like our mind is kind of like our body. If we don’t wash our bodies every two days or every day, your body will stink. So is the same case with your mind. If you don’t pay attention to your mind, to your psychological wellbeing, your mind gets dirty. Michael: So how do you wash your mind Laiming? What sort of mental exercises or whatever can you do? LM: First person shooting games! Michael: OK. HY: And also getting married. See Laiming has said earlier a wonderful point of view that after getting married he’s matured. He’s learned how to manage his emotions a bit better. Michael: I think call of duty probably helps with that. LM: Yes, it helped a lot. HY: See you need to have different avenues to like balance it out. LM: But you need to recognize that there’s this alternate reality around you with this emotional dimension. Michael: I’m not sure if I really buy into all this, to be quite honest with you? If you think too much about this because you don’t have enough else going on. I think if you keep yourself busy, you don’t occupy yourself with thoughts like this. I think it’s very easy to overthink when you are a bit bored or you are at a loose end. I think maybe that’s contributing to this sort of phenomenon. LM: You mean we are self-pitying? Michael: Exactly. Self-pity, self- loathing, whatever you want call it. HY: I think it’s a constructive advice what Michael has just said. We’ve got a whole bunch of messages coming in, regard this topic. There’s “yszdd” saying that 大姨妈是生理需求,而男人的大姨夫则是心理的需求。I think that is a good point and I do sympathize with guys. Yes, you don’t always have to be strong. You can let your feelings out too. But don’t call it 大姨夫. You know, don’t make it bigger as what it actually is. That’s just whiny.