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Okay, most of you got that these are song lyrics. Way back in 1978, a band called Cheap Trick wrote about the relationship between the baby boomers and their parents. If you play Guitar Hero II, this song is also featured. It seems that this song has made the rounds in the past year or two, being on TV, commercials, and back on the radio. It’s a good song. But what does it have to do with personal finance?
Ex-President George W. Bush convinced the American public that we had to go to war with Iraq because Saddam Hussein was a bad guy that wanted to hurt us. This was just after 9/11, and we were all a little afraid that terrorist elements wanted to cause us harm. We were right, but many will argue that Bush took us in the wrong direction by fighting a war in Iraq. Bush’s strategy was simple. He told us that we needed to do this immediately for the good of the country and of the world. He convinced us to suspend our own thought processes to further his goals. We were more afraid of doing nothing than we were of what had already happened.
People will argue whether or not he was right. Some people accurately believe that Hussein was a bad guy, who wanted to hurt Americans, and who had threatened to do so. Others, just as accurately believe, the argument for going to war to find nuclear weapons was inaccurate. There are arguments on both sides of many issues here that I’m not going to get into here, but for better or worse, except for a few who are always against any type of show of force, or those who just don’t like America, we all agreed at the time, that we had to go into Iraq.
More recently, current President Barack Obama used the exact same methods to further his goals. Housing had just started to return to normal pricing, which scared people who were trying to game the system, banks who had invested in artificially boosting housing had taken out loans to pay for this gamble, and these loans were coming due, and people were starting to figure out that the “prosperity” of the past was not real. We were again scared. President Obama, fresh off the success of a 3 year election campaign, told us to once again suspend our powers of common sense and independent thought and buy into his plan for “saving” the economy.
His plan has been simple so far. Strengthen unions, socialize banks, demonize individual wealth and those who have it, and essentially throw money at the problems. The economy isn’t really that big of a deal, and he knows it. His plan is more about his vision of the expansion of social welfare, government sponsored (tax-payer financed) medicine, a deterioration of individual incentive and liberty, and an increase in governmental power. He does this not because he is evil or because he doesn’t get it. He sincerely believes that these things are better for the country. He received government help in getting to where he is today, and he believes he is helping others, many, many others to do the same.
The problem is that in both cases, we have been asked to surrender a lot of freedom to further the goals of these two presidents. In the first, the price was mainly paid by the military, their families, and those who had reason to worry. In the second, the price is going to be paid by the taxpayer, their children, their children, and everybody who has worked hard to do for themselves what government should never get involved in.
In school, many of you are indoctrinated into believing that everything that is going on is part of the solution. I know because I’ve worked with the people who are doing it. But, I’m telling you today, as I’ve told my students, do not just accept what someone tells you.
You see, while this latest round of surrender of common sense is costly, it is not going to be the last time this happens. President Obama will ask you to suspend your common sense again. The president after him will do the same. This will only stop when enough people stop letting it happen.
Young people need to realize that things happening right now will have an effect on them in the future. Our public schools are a failure when it comes to teaching young people to think for themselves. On the contrary, they are specifically taught to not think for themselves. So young people need to harness some of that rebellious nature we’ve heard so much about, educate themselves, even when the subject doesn’t seem to have an effect on them, and be vocal about doing the right thing.
And yes, Mommy is alright, as is Daddy. Their recent weirdness has been described as a temporary condition that wears off as you get older.
Just yesterday, I saw the newest episode of the show SUPERNATURAL. I really dig this show, and it is a frequent topic of conversation between my dad and myself. Last night, one of the characters was getting a lecture on wanting something different from life. Essentially, the message was the same as the movie THE WIZARD OF OZ. The character was fighting against being who he was meant to be. I was particularly struck by one quote that nailed one of the basics I teach about personal finance:
“Most folks live and die without moving anything more than the dirt it takes to bury them. You get to change things, save people, maybe even the world. All the while you drive a classic car and fornicate with women. This isn’t a curse, it’s a gift. So for God’s sakes, Dean, quit whining about it. Look around: there are plenty of fates worse than yours.”
If you’ve ever seen the show, you’ve probably had the same thought my wife and I have had several times. That would be a cool way to live. Driving around the country, not worrying about all the things we worry about every day, killing monsters. But then the episode ends, and we start preparing for the next day.
By now you’re wondering what this has to do with personal finance. Maybe you’re thinking that I just wanted to use the quote from the show because I liked it. And if that were all it was, that would be a good enough reason to do it. But there is more than that.
Right now, as young people, you have the freedom to do some things that many adults would envy. Right now, you get to make mistakes with little repercussion, right now you can go through a day without having to worry about where you will be next week or next year. We adults have made our decisions, and have made mistakes that will impact you and your children in the name of greed and politics.
When you are at your minimum wage job, probably still living at home, complaining about how much it sucks to not have the money that older people have, let’s look at some of the rich people in the world.
BILL GATES: Mr. Gates is the founder of Microsoft. He has more money than he will ever be able to spend in his life. His company is also regularly in court because other companies haven’t been able to make a better product, and so sue him, saying he is against competition.
GEORGE SOROS: Mr. Soros is an investor that made a lot of money betting that the US economy would go bust. He is also widely accepted to have been anti-American policy, and a sort of “kingmaker” who puts radically liberal people into office to forward his goals. He was also convicted of insider trading.
JOAQUIN GUZMAN LOERA: Mr. Loera is a drug dealer from Mexico. He is a criminal that is the most wanted criminal in Mexico.
So, these are people with money. Are they happier? Are their lives any better? And these are just billionaires. We could talk about millionaires like those who ran the banking system into the ground, or like the politicians that allowed it to happen (I’m still looking at you, Dodd, Frank, Pelosi, Reid, and the rest of your criminal cabal), or like the many “victims” of Madoff.
So when you go to your job, take pride in the fact that this is a temporary situation, and that you have freedom and luxuries that the wealthiest people simply don’t have anymore.
Second, when you hear from people in your school, or family, or work, and they want to make it sound like rich people are the bad guys, and how they are the blame for everything that goes wrong. Think about what their motivations are. Many just don’t know any better. They feel that making the rich the enemy somehow puts them on a higher moral ground. Let me just point out that without those “evil”, rich people, most of us would have no hope of improving our own lives. Remember, the government doesn’t want you to do better. They want everybody to do equally badly.
Now that spring has finally sprung, it’s great weather in Southern California, and Spring Break is either going on or will soon be going on, here I am in a darkened office, looking at issues that young people might need to be made aware of.
First, let’s talk about spring. If ever you’ve watched Bambi, there was the scene, when spring had finally sprung that Owl commented that the young characters were “twitterpated”. This condition occurs when young critters fall in love and their hormones go wild. This is not a love advice blog, so I decided to stay away from this meaning.
I also thought of the service TWITTER which as most of you know, is a service that allows people to microblog their daily lives for anybody who wants to know. I never understood the concept because I highly doubted people wanted to know every time I scratched my butt! But last week, I jumped on board, and found that Twitter can also be a useful tool to expand my message. In fact, if you are on Twitter, and want to follow me, THIS is my profile. I have a few followers, and I follow them and a few others that interest me.
One thing that struck me about many of the people on Twitter, is that they seem to all be experts (or so they claim). Many say they are image experts or blogging experts or some sort of expert. I’m not doubting them. I’ve chosen to take them at their word. After all, there has to be some experts somewhere. But I thought of many of my students, and many of the young people I know. They hear the word expert, and they believe what they are told. This can be very dangerous.
Experts are rare.
First, I’ve known many people who have done something for a short time who believe they understand all there is to it. When I was in banking, I heard many tellers say they were experts because they had been a teller for a matter of months. They weren’t.
Second, I’ve known people who know more about a subject than their peers, and they believe this makes them experts as well. While subjective to their peers, this may be true, my wife took German in High School and College. Few people do this. She can’t speak German, but she does know a few words. Does this make her an expert when the group is her, me, and a few of our friends who also didn’t take German?
Third, there are people who genuinely are experts in a specific area who believe that this expertise translates into a larger area. For example, I am certainly an expert at personal finance and branch operations related to retail banking. Does this make me an expert in finance? In banking systems? Allow me to answer that for you. No it doesn’t. I’ve taken some steps to become more educated in these issues, but I’ve never pretended to be more than a guy who knows about personal finance and how to run a successful branch. Could my expertise and experience lead to becoming an expert in these areas? Sure, if I were to dedicate my time and efforts to it.
What makes an expert?
So what makes an expert? Time helps. Dedication and education help. Recognition helps. There are many experts and geniuses out there that people simply don’t recognize because their ideas are so complex that most of us can’t even wrap our heads around them. So what doesn’t make an expert? Well, calling yourself an expert doesn’t help. Neither do other terms like, guru, consultant, or yogi. Being on TV doesn’t help, although many experts will go on TV. They were experts before TV. Even though I’m writing a book, writing a book won’t make you an expert, especially if the premise is a lie or inaccurate. Some of these experts are experts at marketing a book deal or a TV spot, but don’t have a message. Some of these experts have humiliated themselves in the public arena repeatedly, yet they still call themselves experts.
The Bottom Line:
The bottom line is that you have to be skeptical of anybody who is claiming to be an expert. Some of them might be, and they will be able to prove themselves accordingly. Others won’t be able to prove themselves at all. I’ve always advocated questioning. Question me, question your teachers, question authority. That’s the fun part of being young. Sometimes you get to piss people off by asking questions they don’t want asked. Sometimes there is a price to be paid for this questioning, but sometimes the rewards are more than the potential costs. Only you can make that decision for yourself. But if you choose to never question others, don’t question later why you aren’t where you wanted to be in life.
I used to spend a lot of my day training young people who wanted to work in finance how to do their jobs. I liked this part of the job. When I was young, there was nobody around who particularly wanted me to succeed or fail, so nobody took time out to see me do either. I made a lot of mistakes that I didn’t want to see other people make later on. Some of these mistakes are common to early jobs, some are unique to customer service, or even to finance. Right now, with the economy falling down around our ears, any mistake that can be avoided should be.
What time is it?
I only had to actually punch a clock a couple of times throughout the years. Even then, most of the time I just wrote my time in and out the day I turned in my time card. I never abused it. I have seen people who think its no big deal to come in a few minutes late here or there. Or maybe they need to bail out a little early once in a while. When you’ve established yourself at a company and have a strong reputation, maybe you’re right. Maybe there is no problem, as long as it doesn’t happen very often.
I remember at one company I worked at, I was late. Probably 15 minutes late. I had no excuse. I just overslept. It was a busy day at work, so I forgot all about it until I had to turn in my time card. I put in the correct time and turned it in. My boss fixed my time card to reflect as if I had been there on time. I asked her about it and she said nobody would have believed that I was late anyways, and I probably worked extra hours to cover. I did, but the point was that nobody would have believed that I was late. I had built my reputation to the point that people knew that I would have worked my whole shift. It was a struggle to get people to understand that I had screwed up.
When you have a job, make sure that you are on time. Don’t come in late, don’t think that extended lunches aren’t noticed, and never leave early without your bosses permission. I know that many readers might think that this advice is unnecessary. For many older people, it might be. I’m not writing for older people. Young people might not understand how important punctuality is.
I had a co-worker at one company who liked to go shopping at lunch. We were close to a mall, and she had a weakness for crap on sale. The funny thing about malls is that they are pretty dead during the day, unless there is a major holiday around, like Christmas. This employee went Christmas shopping during her lunch hour and a half. She frequently took long lunches, especially when I was around. It didn’t bother me, and since I wasn’t her boss, I didn’t care about her shopping habits. The day after she was out of balance in her cash drawer was a little different. Her boss came in to go over her work and cash drawer while she was on lunch. After an hour waiting, we sold her cash back to the vault, and she was terminated upon returning. It really sucked, but she knew the possibilities were there.
Just remember, things that you think nobody notices, are noticed by people all the time. You won’t get away for too long with screwing around with your time card. Right now is not the time to do something that might cost your job.
I’m going to try to keep this one short.
Money Laundering is defined as the practice of disguising illegally obtained funds so that they seem legal.
So let me make this one simple. Last year, Tim Geithner arranged for a bailout of AIG. Chris Dodd and the rest of Congress went along with this plan, despite opposition from the American people. Some Congress members tried to put in language that limited the amount of bonuses paid to AIG employees. Chris Dodd and clan struck that language out.
AIG employees who had their contracts stating that they were owed these bonuses were paid. Yesterday, several congressional leaders made comments that indicated they advocated breaking the contracts, not paying the bonuses and challenging the screwed employees to sue them in court.
If I were in charge, I wouldn’t pay them. When they asked, I’d tell them to sue me.
I heard Pat Leahy say that yesterday, and I’ve heard Barney Frank and others say virtually the same thing.
Since the bonuses were paid legally, Congress has decided to tax these employees 90% on their bonuses.
Sounds pretty good, right? Congress frees some money for a bailout, and then taxes recipients of the bailout. Does this taxed money go back to the bailout fund? Hell no. This is tax revenues. This goes into the same black hole that all our taxes go.
If I were a more suspicious man, I’d say that this was planned. If I were more distrustful of a government with a list of reasons to distrust them, I’d say this is exactly what was supposed to happen.
Is this the end of 90% taxes on any perceived enemy of Congress? I seriously doubt it. This is most likely only the beginning of a second spiral downward. When wealthy people are punished for their wealth, they do things like leave. When there are no more wealthy people, who pays the bills that Congress will be sending?
Well played Congress, well played administration. Hopefully, this is it. You are now on notice. People won’t put up with this forever. You can go on whatever TV shows you want to try and spin this, but even stupid people figure it out eventually.
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