GIG Downs Despite Ups

It is too easy to make fun of Internet discussion boards. Either they’re as empty as vacant warehouses, or filled with ridiculous noise like a frat party. There are a few in the middle with good conversations, but even there a purposely discordant voice can derail most of the value. Just as powerful though, can be a single voice that asks a simple question that inspires a cascade of thoughts. One of the members of InvestorVillage.com sent me a back-channel message that produced a response of too many words with too little information. This blog post may just amplify that, but chronicling the thought process is valuable. The paraphrased question; “What do you see GIG’s upside is from here?“. The essence of my answer; “Up. But, I don’t know how far.” I should know.

GIG is the trading symbol for GigPeak. According to the company in techno-speak that is an improvement over previous descriptions;

GigPeak, Inc. is a leading innovator of semiconductor ICs and software solutions for high-speed connectivity and high-quality video compression over the network and the cloud. The focus of the company is to develop and deliver products that enable lower power consumption and faster data connectivity, more efficient use of network infrastructure, broader connectivity to the cloud, and reduce the total cost of ownership of existing network pipes from the core to the end user. GigPeak addresses both the speed of data transmission and the amount of bandwidth the data consumes within the network, and provides solutions that increase the efficiency of the Internet of Things, leveraging its strength in high-speed connectivity and high-quality video compression. The extended product portfolio provides more flexibility to support changing market requirements from ICs and MMICs through full software programmability and cost-efficient custom ASICs.

My simpler answer from my Semi-Annual Stock Synopsis;

GigPeak is a producer of high-end electro-optic communications switches. Through a variety of technologies, some of which have few moving parts, they are able to produce and sell the switches that allow the very high speed Internet connections that are considered necessities (that only a few years ago would have been considered luxuries).

Add software to the hardware and see that they provide a package that lets us stream videos, download massive software updates, and complain if we encounter buffering or have to wait three seconds.

If you think the Internet is growing, they’re in a good business. If you think people expect ever increasing speed and bandwidth, they’re in a good business. If you think they have few competitors because what they do is so boring and esoteric, then you understand why so few people want to understand them. Why research a tiny and volatile company with a product that’s difficult to understand when you can buy into a bigger company that’s easier to understand and less likely to do something unexpected?

That last piece of logic drives much of the investment world. They want big companies that are easy to understand where they can invest a lot of money. That’s why I invest in small companies that others may not understand. Buy them low when they’re overlooked. Sell them when they’re making so much money that they can’t be ignored by the larger investors.

Let’s get back to the question; “What do you see GIG’s upside is from here?“. Rather than simply say, “I don’t know.”, I’ll point out specifically what I don’t know that I hope to know.

My preferred method of estimating small companies doesn’t have a catchy acronym: the Present Value of Future Revenues Discounted for Risk. If you want more details, check out Dream Invest Live coveror buy my book, Dream. Invest. Live. – oh yeah, and read it, too.

The key variable is the Future Revenue. How much will the company make in the future? There’s a different answer for every quarter of their future, so to simplify the analysis I concentrate on the Future Revenue when they reach maturity. How much money will they be making when they become a recognized competitor in the industry and a desirable investment in the market? Those are subjective measures, but to simplify the analysis I look at their current competitors, or the size of the industry, or both. For a first guess, I look at the list of Related Companies in Google Finance. Most of them are in the $1.5B to $7.5B market cap range. GigPeak is currently at $0.17B; which suggests a range of about ten to fifty times their current valuation. Not bad for an investment, but without any timing. According to their earnings report, their revenues grew at 52%, and are expected to grow by at least 45%. I’ll assume a growth rate of about 41% because that doubles the revenues every two years, a bit less than what they are doing now. At a double every two years, the company and hopefully the stock will reach eight-fold growth in six years, and 16 in 8, 32 in 10, 64 in 12. Somewhere in there they’ll probably plateau – unless something changes.

GigPeak is known for changing.

GigPeak’s history is convoluted enough that it would make a book. Its changes to come will probably make another one. That tendency could raise the estimates, but there’s little reliability in such projections.

There’s also little reliability in any projections. GigPeak may gain a premium if they outcompete their competitors. GigPeak may implode if a competitor, especially one with more resources, creates a superior product and technology. It’s harder to imagine Internet growth slowing, but this is a strange world.

I’m not in a hurry to improve my estimates. Even if I found better projections for the company, its competitors, and the industry, technology and the markets are changing quickly enough that the added details may be moot. If I estimated a twenty-fold increase and was off by half, then I’d have either a ten-fold increase (yay!) or a forty-fold increase (YAY!). Both are good returns on investment. Neither returns me to retirement without help. Any further analysis would simply be enabling the more anal side of my psyche.

Today, GIG closed at $2.53. According to Google, that gives them a remarkable Price/Earnings ratio of 148, about ten times higher than most investors think is reasonable. That’s what happens when a company turns from unprofitable to profitable; E ~ 0 and math gets a headache. The Price/Sales ratio is 4.28, a little high compared to its competitors, a little low (I think) for growing companies with disruptive technologies. I’ll feel more comfortable with my estimate after I find a better value for Future Revenues and the size of the industry. Until then, I’ll continue to Hold.

Until then, I’ll also continue to appreciate fellow investors who ask pertinent questions without getting impertinent.

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Frugal Voting

Vote; especially, if you’re an American citizen. I wanted to get that in there first.

If you don’t vote, quit complaining (unless someone is keeping you from voting, but that’s a different issue.)

  • Step one: Notice yet another patch of clouds coming in, so postpone my walk.
  • Step two: Decide to vote, instead.
  • Step three: Pour a mug of tea, grab the voters pamphlet and ballot, and open myvote.wa.gov. (Your situation may be different.)
  • Step four: Sip, read, research, vote for a position; and repeat until done.
  • Step five: That comes later.

Let’s see how long this takes a frugal person like myself. To put this in perspective, the Voter’s Pamphlet is 135 pages long. There’s a lot going on.

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16:37
Initiatives
Oops. Need a pen, not a #2 pencil.
Research only one initiative.
16:45
Advisories that are non-binding? Really? Ok.
16:45
Ah, Elections.
Interesting. Just based on the list, the Third Party Candidate would be from the Socialist Workers Party. The Libertarians are the seventh party, at least on this ballot.
Easy. I didn’t slow down until I hit the State positions below Governor.
16:54 A real life interruption: a phone call.
16:56
The mid-tier slowdown.
Everything filled in and signed.
17:04
And, into the mailbox. There’s even plenty of tea left in my mug.

As usual, I’m more interested in making every moment count than in understanding every nuance in political positions. Years and months of debates, platforms, conventions, ads, and social media declarations come down to picking from a very limited set of candidates. Usually, A or B; or at most, A vs B vs C vs D vs E vs F vs G vs write-in. In a republic or a democracy, voting is important. The importance of voting, however, does not mean the decision has to take a lot of time. After all of that time, I frequently find that the few hundred words in the Voters Pamphlet reveal the distinctions between the candidates. When their positions are reduced to one page, they have to emphasize what they consider most important. If the distinction isn’t there, then I research, not before. Just in time research saves lots of personal time, and I’m busy enough to appreciate getting some of my other tasks and chores done.

I do track the odds in the presidential race more because I am fascinated with data than the sport of politics.

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The federal positions are the easiest. Even without research, there’s enough unavoidable chatter that enough news gets through. The local positions are very easy, too. I don’t hear as much about them; but I am also more likely to know someone who knows the person, know someone who is affected by the issue, and know whether it will directly affect me. Local elections are far less abstract. It is the middle of the hierarchy where more time is required. The candidates are less well-known. The positions tend to be more restrictive, so the candidates have a tougher time emphasizing a meaningful distinction.

Disclosure: I feel voting is vital to society, and I feel that secret ballots are equally vital. So, no, I’m not going to tell you who I voted for. But, I will tell you that, thanks to Washington State’s diversity, I was able to pick from at least seven parties and a wide range of cultures. I like that. It’s one of the main reasons I enjoy living in Washington State. Normal ain’t normal around here.

Frugality is personal. Frugality is a person valuing their resources based on their values. What’s important to you may not be the same thing that’s important to me. That’s great, and that’s also why democracies and republics are messy. Every individual vote counts because we each represent ourself. Parties and candidates rely on ideology to generalize positions and hopefully gather sufficient support and votes to get elected. If their generalized ideology fits your values, congratulations! That’s how the party got started, like-minded people gathering around a common cause and goal. If their generalized ideology doesn’t fit your values, don’t be surprised. Congratulate yourself on being you.

If you don’t vote; don’t complain.
If you do vote; Great! even if I don’t agree with you.
If you supported a candidate or party; thanks for putting that much more energy behind your values.
If you are a candidate; you have my respect because you’ve done more than most.
If you got elected; congratulations. You’re devoting part of your life to running our country; and losing part of your privacy.
If you’re one of the candidates I voted for; thank you. But, don’t be surprised if I forgot whether I checked your name on the ballot. Hanging onto the logic behind my vote is moot. The vote is cast. Whether my logic was logical doesn’t matter until the next election.

I watch this process played out in the media, and across social media. I look forward to February because the Electoral College should be finished by then, the Inauguration should be over, and friends who’ve unfriended friends may remember they truly are friends.

For the last few years, a thought recurs when I am voting. I come across position statements that make me wonder why no one more qualified is running. I come across unopposed positions. I vote. I’m not a member of a party because none mesh with my eclectic perspectives. And yet, maybe I’ll take that next step and see what it takes to do a bit more than vote. Considering my current financial position though, I wonder if I can afford the time.

Step 5: Remember Step 5 from above? Finish my tea, and pour myself something stronger. As simple as my voting process was, we’re in the midst of a maelstrom that may continue after Election Day.

If only I could vote for the United Federation of Planets.

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Storms Blowing Through

There’s a storm blowing into the area tonight. It looks like it could be historic, or at least feel that way. In the meantime, the power is on, and I can write. Locals reading this just after I post can appreciate the wind storm coming up the Sound. It may set records. My Voters’ Pamphlet arrived today, and those waters certainly aren’t calm. Within my business and personal finance world, one significant cutback and a hint at another are making my mind turbulent enough, even without the other turmoils. My Litany of Optimism includes a powerful concept; storms blow through.

A confession. I’m a weather geek. With a bit more encouragement in Junior High School I probably would’ve apprenticed myself to the local airport’s meteorologist. It was about a one mile walk to the tower from my house. Some friends and I would head over there and ask for the old weather maps, the ones that were out of date. Thanks to a weatherman who had a sense of humor, and an inspirational science teacher, we learned about highs, lows, and occluded fronts. For a while we took daily weather readings for the school. I wonder what happened to those records. Despite the support from adults, no one took us seriously; though I do wonder if that created the foundation for my eventual career in aerospace. Now, it means that I read the Weather Services forecast discussions, the chatter behind the forecasts where they reveal their level of confidence and the unpublicized scenarios. I post them on Facebook where they’re reasonably well received. That also means I’ve been watching this storm approach for days.

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People in hurricane zones scoff at Seattle’s storms. Ours don’t even get names. And yet, any region that gets storms that can knock out power for five days for some is wise to respect nature’s expressions. The coast has already seen hurricane level gusts, though not sustained. Of course, the 20 to 40 foot waves have an impact, too; but that’s there, not here. Here, the gusts are expected to hit 50 mph starting about now. It’s just past 10PM and the winds have already blown open a window, one of those that go up and down. Not sure how it did that. The house has already felt a couple of bumps that felt like small earthquakes.

Watching a storm approach for days means having plenty of time to prepare. I already have an earthquake kitDSC_5840 (doesn’t everyone in the neighborhood?), but wind storms and power outages usually don’t require that level of preparation. I had to cancel some meetings but I was able to check on a roof patch, brace the fence, clear the deck, harvest before the wind did it, and stock the freezer and refrigerator with ice, and stock a cooler with food and ice so the big box can stay shut while I eat from the smaller one. It’s a good thing wine stores well. So do potato chips.

I suspect I’ll have to clean up the yard a bit, and maybe wait a while until the power comes back on (assuming it is going to go off at some point); and that the storm will pass.

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The electoral storm is certainly historic. I’m planning a separate post on my frugal approach to voting (Vote!), but I mostly steer clear of political debates. I have opinions, and I like the fact that in the US we have secret ballots. One interesting consequence is that most folks think I’m voting for the other party whenever I don’t automatically agree that I’ll vote the way they will. Maybe I will, but secret balloting is one of the keys to free representation. One thing I do enjoy, however, is posting the British Bookie report. After the conventions I start tracking the candidates via Ladbrokes, the British betting site. As I posted earlier today on Facebook;

I figure bookies have to get it right, otherwise they lose money. American pollsters make money by conducting polls, and the tighter the race the more polls are conducted. Pollsters, therefore, like to report about close races. And yet, bookies may have other incentives. I don’t know. I don’t use them.

As tight as some make the US election sound, the gamblers think the race is nearly certain. Wait a month and we’re likely to know. Another storm will have passed, probably.

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While I was getting ready for the storm, I picked up my mail. Nice. A check from a long-term client. Usually, the check is wrapped in a thank you note. This time it was wrapped in a cutback notice. It’s only 25%, but that’s also the amount of my health care premium. I’ll be able to adjust, and I’m glad I stocked the pantry. Within my Litany of Optimism is also a fascinating part-time temporary job that was going to restart soon; and I received an email hinting that the project may be cancelled. A couple of other opportunities have been suggested, but bills aren’t paid by suggestions. And yet, the right good news can make an enormous difference. My brain’s been swirling with the upsets and possibilities, but the main thing I can do is relax and let networking and budgets sort themselves out.

Those aren’t the only storms in my neighborhood, but they’re enough. If stubbing your toe makes you forget about the cramp in your thigh which made you forget about hitting your not-so-funny funny bone, then great. They’ll all get better, but in the meantime, ouch, ouch, and ouch.

I have the equivalent of the stubbed toe, et al. It is too easy to imagine someone who doesn’t have a home, is worried about deportation, and has even more uncertain employment. I’m impressed with how some people get through a day.

Frugality encourages being prepared. It doesn’t take much to put together an emergency kit. Some electoral decisions are easy. Appreciating the value of various skills and talents creates optimism based on awareness, not just hopes.

These storms will pass. Things will calm down. I tell myself that, and know it’s mostly true. And then, there’s the next storm, which is really the candidate for history. A dying typhoon is about one day behind this wind storm. They do that, dissipating their energy on the first coast they find. That storm, too, will pass. Let’s hope the electoral and financial storms don’t have similar second shifts.

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Chaos And Continuity

Nothing extreme is likely to happen. Read that two ways: 1) in general, extreme things typically have low probabilities, and 2) specifically, civilization, society, and culture have great inertia and tend to continue with only slight shifts. As I write this, there is great political upheaval in the US because of old tapes and old emails. Shifts are happening and yet convention will probably persist. And yet, it’s a good idea to consider possibilities because change does happen. Better prepared lessens the surprise.

Pick your political candidate and someone probably thinks they belong in jail. That’s nothing new. Most of the attention is directed to the Republican and Democratic candidates because they are the predominant political parties. As I’ve said before, I am an extreme independent moderate. I’m convinced that neither party has all the answers, and that the answers that will produce the most progress are probably in the middle. That’s a generalization, but it must suffice because I’m not going to write a political platform paper – yet. (Hey, who knows? I might run for office some day, or be the focus of a viral write-in campaign.)

Because I am unaligned, I’ve also been able to spend more time investigating the other parties. (More parties are good, right?) I don’t consider them third parties because, as I recall, the US Constitution doesn’t restrict the number of parties or require that there are only two prominent ones. Why not have three, four, or seven parties? It might be a mess, but it is legal and allowed. But, we’ve always only had two parties, right? Nope.

One of my favorite comics included the most extensive history of US political parties and how their power has shifted over the centuries. Democrats and Republicans? Sure. And, Federalists, Whigs, Free Soil, American (such an obvious name that I’m surprised no one has revived it), Unionist, Populist, and Progressive have all succeeded at electing members of Congress. That doesn’t include the Tea, Coffee, Libertarian (though maybe I missed it), Communist, Socialist, Green parties and others that might be found in the back pages of the election guide. All of the parties existed in turmoil. All saw their powers grow and fade. Assuming there are only two parties in the US and that they will always be in power means ignoring the history that created them.

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Our current economy and political environment affects the way we live, work, and plan. The best assumption is to assume that next year will be like this year; but it is equally important to be aware that assumptions based on human nature can be invalidated with a singular event or revelation. What would happen to the population of US politicians if an American version of the Panama Papers revealed too many elected officials privately using the tax havens some of them publicly oppose?

Recently, a friend and I spent an hour or two playing with my Pinterest board that is a collection of Alternative Americas. The US has had fifty states for more than fifty years. Some see that as stability. I see it as stagnation. Stagnation is rarely healthy. Regional differences can create new boundaries if the differences become extreme. Just like with Congress’ history, it was interesting to compare the history of the states and their boundaries with boundaries from possible scenarios.

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While the US expansion may seem like an inexorable and inevitable westward progression, the process was chaotic, sometimes unseemly, and involved redrawing lots of lines as squiggles and some squiggles as lines. Slow, methodical pioneering makes for stately stories; but it was the surprise discovery of gold that added California which stressed the slave state versus non-slave state debate. A pig (yes, a real pig) caused the Pig War (yes, a real war) that had no casualties except for the pig, and that was resolved by having a German official define the national border between the US and the UK (at least British Columbia) by drawing a line around some islands that were initially explored by the Spanish. One fateful turn of a shovel and one escaped farm animal each helped redefine the nation.

Good luck guessing at what else could add or subtract a state to the United States. If you want some inspiration though, check out a few of the maps on my board. Of particular interest to me is the one that draws the 124 States that could be created if all of the secession and reincorporation plans succeeded. (Have fun trying to say successful secession several times.) I live in what would and could be Cascadia or Columbia (depending on the mapmaker), a region defined by temperate rainforests, the Pacific Rim, and left coast politics. I was born in what could be Westylvania, that region that includes the mountainous coal mining country, a region that where Pittsburgh no longer has to pretend that it has anything in common with Philadelphia.

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Britain’s exit from the European Union isn’t as dramatic as a possible Texas exit from the rest of the US; and yet Britain’s economy is definitely affected. Imagine what would happen to the US dollar if the US no longer included Texas’ oil fields. Just for fun (because it probably would never happen) imagine how much it would cost to build a wall around Texas, or at least relocate military bases and install border crossings.

Let me pause to check the news.

Okay. Great fervor continues. Write in candidates are being discussed. The British bookies have elevated Mike Pence’s odds of winning the election to 33 to 1, and Paul Ryan’s to 50 to 1. Low, but rising quickly.

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I’m fortunate enough that I was able to keep my house thanks to a non-profit agency that helped renegotiate my ~6% thirty year mortgage to a 2% forty year mortgage. (For the long version of the story start with one of my posts.) I’m grateful, and plan to continue paying the mortgage (you can help by hiring me to help you pursue your projects – self-promoting plugs are allowed in America). Assuming that I live in the house for the next few decades, I place a low probability of paying off the loan in US dollars. The economy, technology, society, and the planet are changing quickly enough that it will be a surprise if something dramatic doesn’t change the currency or the country.

A shovel can create a migration. A pig can redraw national borders. A political party can fall from one of the two favorites, creating an opening for change.

Change. That’s the constant. Assuming nothing every changes is the mistake. Assuming nothing will change is the easiest way to plan. It’s easy to make mistakes.

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Costly Commuting

It’s a fine, old truck. It’s generic white, has a good cap on the back, only has a few dings and dents, and could use a few thousand dollars if I decided to make it like new again. That’s not happening. It isn’t the vehicle I would choose if I had to shop for a replacement, but when my Dad offered me his truck I said yes. Of course. It’s a fine, old truck, and I’m very aware of what it costs to use it. Filling it up today made me wonder about how much it costs people to get to work, not just the money, but the time, too. Time to break out the spreadsheet.

I am a fan of walking and bicycling. If you have any doubts, read my books (Just Keep Pedaling and Walking Thinking Drinking Across Scotland). My house, the only place I’ve ever truly felt at home, isn’t close to anything – on purpose. When I moved to the southern tip of Whidbey Island I thought I’d be retired; so, being remote was not an issue. So much for retirement. The only business within walking distance is a much-improved convenience store 1.6 miles from my house. (They’ve expanded into offering food, microbrews, and music.) The nearest strip malls are about 6 miles away. The distance isn’t bad for bicycling but the routes are hilly. The elevation gain is about 500 feet. Doable, but not if I want to be presentable.

Most of my local business trips are at least twenty mile round trips. The truck gets about 16 miles per gallon; so, take the price of gas, multiply by 1.25 and get the direct cost of my commute – about $3.50 to $4.00. For me, that’s noticeable and acceptable, but a couple of years ago it wasn’t.

That flashback hit as I was filling the 26 gallon tank today. What about the people making minimum wage?

People making minimum wage frequently have few choices. They use the transportation they have to get to the job they can get. More fuel efficient vehicles are great, if you can afford them. If, however, you’re stuck with what you’ve got, you may not be getting great mileage. Getting a better job is great, which is something almost every worker is working on. Of course, if they could get a better job they wouldn’t be making minimum wage. For those who are working for minimum wage, commutes tend to be long because good jobs centers tend to raise housing costs. Affordable housing means a longer drive, possibly from where there isn’t mass transit.

A car or truck that gets 18 miles per gallon using gas that costs $2.75 per gallon costs about $0.15 in gas per mile to drive. That doesn’t sound so bad, but for a typical American commute of 30 miles that’s $4.58 each way. For someone making the federal minimum wage of $7.25 per hour, that’s 1.26 hours of work just to pay to get to work. With taxes it gets worse. Dive into taxes and see that the IRS accepts the total mileage cost is more like $0.54 per mile, 3.6 times higher. That means working 4.5 hours to pay for getting to a job that hopefully is much more than an 8 hour shift.

Fortunately, the shift to a $15 per hour minimum wage is making progress. Even in places that have established it, they’re phasing it in, but it is progress. The time cost for commuting to a Seattle minimum wage job is approximately half the time cost of commuting to a federal minimum wage job. Of course, one reason Seattle raised the minimum wage is because Seattle is so expensive to live in that many of the people working essential services can’t live in Seattle, or even King County.

A friend and I had a conversation the other evening about the pace of life. We both have memories of having the time to read the paper either before or after work. Home time was chore time, but most evenings that was followed by reading a book, watching tv, or calling friends. It isn’t just a fantasy or a delusion; those times did exist. What happened?

There’s no one cause to our loss of time. But, filling my truck’s gas tank made me think about where my time and money go, and where my friends’ time and money go. People who aren’t making enough have any extra money probably also have less extra time. Losing an extra hour or two or more just to keep a job means less life in their life.

Whidbey’s economy relies on tourists. I work from the tourist town of Langley, sitting in coffeeshops or the library at least a few days per week. It’s good to get out of the house. Stay home too long and start to lose social skills. Pardon me while I sniffle and scratch. It’s also good to work in public for networking, collaborating, and the sociological exercise called people watching. The locals taking care of the tourists usually aren’t making much money. I’m impressed with how relaxed some of them are considering what I know about their situation (homelessness is probably more prevalent than the government and non-profits know.) The tourists are the ones who’ve found the good jobs, make enough to pay for vacations – and are frequently incredibly stressed. I can hear it in the way they order their drinks. Two or three days is not enough to unwind months of corporate crises. I can see it in the way some collapse into library chairs.

Today was a rare day. I got ahead of a few items, partly from some auspicious synchronicity. For an hour or two I sat, actually sat with a cup of tea and watched a storm go by. It’s a luxury.

What about everyone else? When getting the right job is tough means high emotional and physical costs; when taking whatever job you can get means using all your time and money to work the job – it’s no wonder to me that people are stressed, want a change; and yet, can’t see an appealing alternative. Even though the odds of winning the lottery are low, the odds of the appealing alternatives seem equally low.

Unless a client arranges a meeting, I’ll work from home for the next couple of days. I’ll save time and money. The meals will be better, too. Then, inevitably, I’ll jump in the truck, drive to some public workspace, arrive more presentable than I would by walking or bicycling, and have to work an extra hour to pay for the opportunity. I’m glad I have that option and wonder what will change to make that available to the baristas and librarians who tend those spaces.

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Lifeboats For Our Species

Unless you’re lucky or asleep, dreams take work. Elon Musk has announced plans to accomplish one of my dreams, colonizing space. First they ignore you. Then they laugh at you. Then they fight you. Then you win. I expect a lot of laughter over the next few years. I’m smiling, but as I laugh, it is in celebration. Something I tried to further made an enormous step forward with his announcement. I had nothing to do with it; but one of my greatest existential anxieties finally has a hope of relief. It didn’t come from a government. It came from an individual. Already, it has put my life in perspective. It probably will for others, too.

In case you hadn’t heard, the mega-billionaire, Elon Musk, has decided to do what no government has seriously considered, try to preserve the species by giving us at least a second home, and maybe more. His plan is to launch a series of enormous rockets to Mars, each carrying a hundred people for the eventual purpose of colonizing another planet, and possibly the rest of the Solar System. Go ahead and laugh, but for me, this is like finding myself on a passenger liner, seeing icebergs in the vicinity, and realizing there aren’t any lifeboats – and then finding one guy who decided to start building lifeboats, not just for himself, but for as many people as possible. In decades, it will be less amazing that someone did something and more amazing that the governments of the world, and the other ultra-rich didn’t. Even though I doubt I’ll get a seat on the lifeboat, I’m glad someone is building it.

Let’s take this back about forty years. I was an undergrad at Virginia Tech (actually Virginia Polytechnic Institute & State University, aka, VPISU, which shouldn’t be pronounced.) My selected major was Aerospace (and Ocean) Engineering. I didn’t care about fighters, bombers, or jet liners. I wanted to work on anything that would help us, Us, colonize space. Our planet is tiny and our internal and external threats have grown too large to have everyone crammed onto one over-stressed shell. One big crack from an asteroid, or one stupidly quick and massive war, and our species would become a has-been. I didn’t expect anyone to start working on space colonies that year, but hoped I was learning the right information at the right time in the right country to help make it happen. The Space Shuttle was new, and I was already hoping to work on the successor, because it was obvious that we’d need a successor. We’d never been stupid enough to throw away that much work. Forty years later, I’ve seen a lot of stupid choices. Short-sightedness is incredibly common.

Space colonization was becoming viable. I joined an advocacy group, the L-5 Society, where fellow dreamers considered the possibilities. I also joined the professional society, the American Institute of Aeronautics and Astronautics, which considered itself innovative thanks to the Apollo Program and various advances since World War II. The L-5 Society continues, but couldn’t sustain the energy to keep me engaged. AIAA became entrenched with the mainstream. I realized my best effort would be to learn how a commercial company like Boeing could make vehicles that fly reliably. I didn’t get to work on space shuttles at the start. They offered me a job working on 747s, then R&D, then 737s, then a supersonic transport – finally something that would start to touch on what I needed to learn about high speed flight. Then it happened. Despite a downgrade, I took a series of jobs that let me work on second generation space shuttles, innovative rockets, and satellites. Decades after I started college, I’d get to work on the very things I considered necessary. In the middle of that came the call.

Boeing had merged with (or been taken over by) McDonnell Douglas. Our remote and new manager called us into a conference room. Over the phone and as a group, his disembodied voice told us to throw away our notions of building something. There wasn’t enough profit in it. If we built something and succeeded, the profit margins would be small. If we built something and there was an accident, the company would lose money. Oh yes, and someone might die. If, however, we designed a vehicle and wrote about the design, the company would make a relatively predictable profit. After that design, we’d design again, again with a predictable profit. Repeat. Low risk, high probability of profit, completely legal, of course that’s what the company would pursue. There was no transcript. The person wasn’t in the room. I never met him. And, I watched the dream die. Instead of growing, the group stagnated. I stayed at the company for a few years, trying to find something satisfying, but began making more money from investments than from engineering, and retired before I was forty.

That was almost twenty years ago.

And along comes Elon Musk, Richard Branson, Jeff Bezos, and Paul Allen, people how made a lot more money than me, all of who are now launching space-based businesses with their billions. Elon has the grandest vision, but I cheer on all of them (and apply for jobs with them, unsuccessfully.) Governments spend trillions on war and almost completely stall space exploration and development. NASA’s annual budget is less than what the US Department of Defense spends in two weeks. Meanwhile, Elon, Richard, Jeff, and Paul have all launched businesses with their (incredibly large) spare cash.

Governments are driven by politics and election cycles. Space projects take too long to benefit politicians. Businesses are driven by profits. There are no profits to be made by preserving the species. At least one benefit of our economic system and our amazing wealth inequality is that someone with a grand passion can exercise it. Few do, but I’m glad they are.

If you want details, call me and you’ll have a tough time getting me to shut up. Or, check out SpaceX’s various sites. The video is easy to watch, but four minutes isn’t enough to describe the challenge.


A pair of details that have already been chastised convinced me that public perception has a long way to go to understand the draw for many who are interested. Sign up for the trip and you may die. Sign up for the trip and you won’t be on a vacation. Sign up for the trip and it will cost you about $200,000. Who would do such a thing? Me. And, I’m not alone. And, I probably won’t go.

I’m frugal. I look at the numbers. Forget about the fact that it is possibly a one-way ticket to Mars. If I was offered an job that cost $200,000, required a relocation, separated me from our complex of dysfunctional systems, and helped me preserve the species against most existential threats, that’s an offer I’d consider. If I had the money. If $200,000 sounds like a lot, consider how much people are already risking with mortgages, student loans, and medical expenses. For some, that’s barely enough to maintain, maybe not sustain, and doubtfully expand their current lifestyle. Within seven billion people, even one tenth of one percent would be enough to fill the dozens or hundreds of ships Elon is proposing.

That $200,000 appeal is a measure of our species’ pioneering nature, but it is also a measure of the state of our current society.

I know I won’t go. If they’re doing this right, those hundred people on each flight will have to meet certain standards: health, skills, talents, fertility, psychology, and ideology. The other 99 people would probably prefer a young, fit, fun, intelligent, wise, and productive person. I may meet many of those criteria, but they’ll have many more to choose from – just like the companies have been able to find other (younger?) engineers.

The horizon is rising. The Sun has set behind it as I type. For many, the idea of colonizing anything off this planet is ludicrous. But for some, colonizing planets, moons, asteroids, or empty space is as natural as realizing that our planet is spinning relative to the Sun, the rest of the Solar System, and the Universe.

If Elon succeeds, great! If Elon fails, our species, society, and civilization have progressed at least a bit. And maybe, when we realize how much sense it makes to move to Mars, we’ll realize we must be able to fix the problems we have here on our first of hopefully many homes.

Elon, congratulations, and thanks for what’ve you’ve inspired.

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Frugal Harvest 2016

It was possible because of friends – throwing away old stuff. The equinox is past. Harvest time is passing, too. The garden that I apologized to has been producing produce and stories. It is time to ask the frugal question; “Was it worth it?”

dsc_6742I apologize to anything I plant. Life’s been busy enough that I typically pull some weeds, plant some seeds, and hope nature will grow something for me. I usually don’t get much. But, the deer, bunnies, and slugs seem to be happy. This year was different. Thanks to some of last year’s seed sales and friends who were throwing away some cracked pots, I was able to plant tomatoes, peppers, and gourds. Thanks to a bit of playing with old fencing, I was able to prop the pots on stands that kept them out of critters’ reach. Previous gifts of raspberry plants, an apple tree, onion and garlic starts, grew this year; especially, the perennials. Potatoes were planted after they sprouted in the pantry. My squash bed (which sounds like a mattress that wasn’t sturdy enough) came from last year’s seeds from the edible gardens of Langley. While all of these things were growing, my mushroom crop has patiently continued colonizing about a half dozen logs. Ginger, grown from pieces bought at the supermarket, sprouted, too.

That sounds like an incredible harvest. Yep. Parts of it were hard to believe.

Apples
dsc_6733Finally, a harvest that overwhelmed me. After years of caterpillars and deer, my trees finally produced a crop. The two small trees that I planted over five years ago have been trying to grow in terrible weather, despite pests, and while being nibbled to bark by deer that walked through a downed fence. Finally, with the fence fixed and record spring rain, they grew and produced an apple – combined. Incredible. Right beside them, however, is the transplanted tree from my neighbor. It and two others were uprooted during a six inch property line dispute. I was too late for the first two, but the last one was planted about five years ago. This year it produced so much fruit that my refrigerator bins are full, and I’ve had ingredients that went into oatmeal, onto pork chops, as part of roasted veggies, and eaten raw. I would’ve had more but the tree has grown too tall to harvest completely. It also turns out that the deer decided to help with the harvest. I thought the harvest was done because there were no more apples hitting the ground. After a bit of investigation I noticed that the lower leaves were being nibbled. The rabbits aren’t that tall. Evidently, the deer no longer fear jumping over the fence. At least they helped with the cleanup. If I want the smaller trees to survive, though, I’ll have to deploy more defenses next year.

Figs
The fig harvest almost overwhelmed me, but they’re much smaller. So far I’ve only used them as snacks, but I’m considering adding them and the apples into my typical fruitcake. I’ll probably have to dry them first. The figs were gratifying. Bite-sized, easy to harvest, easy to freeze, and not prone to blemishes or bugs. I’ve got about a gallon of them in the freezer.

Raspberries
Sticking with the perennials, the raspberries came back. A friend was thinning their garden and gave me about a dozen canes last year. Somehow they survived me and came back. I only picked about a dozen. When they were ripening, I wasn’t watering. They were dried on the vine. The birds appreciated them, though. More defenses.

Garlic
Last year, a very successful gardener game me some extra garlic. Extra garlic is possible? They suggested I plant it this year, which I did. If it’s out there, it’s hiding. I suspect they ended in the bellies of the slugs.

Onions
dsc_6745This spring, a new neighbor was surprised to find free onion starts at one of the local garden centers. Buy something, get a handful of baby onions. They are new neighbors, which meant buying lots of things, and getting lots of onions. Thanks, folks. Mine grew to about the size of golf balls, not bad, but not tremendous.

Squash
dsc_6744Langley is a tourist town with a wide mix of ideas, one of which was to encourage business owners to plant edibles instead of ornamentals. The idea is so simple and so unexpected that most people hesitate to eat any of it. It’s a sad statement to realize that people think they need written permission before doing something as simple as eating a beans and peas from a sidewalk patch. I enjoy seeing plants I wouldn’t see otherwise. The tall artichokes look alien. Last year, one patch had squash. I harvested a few at the end of the season, ate some, and noticed that one was rotting before I got to it. I saved the seeds, planted them, and had the biggest bed of squash ever, for me. The mystery was that I couldn’t remember what kind it was. Evidently, they are big and yellow, so I’m guessing zucchini. I only have two, so will eat one and save the seeds from the other; but I’ll also celebrate a garden bed that was so covered with leaves that the weeds stayed low, and grew so many plants that the slugs couldn’t keep up.

Tomatoes and Peppers and Gourds
The cracked plastic pots and the wire stands were enough of an excuse to actually buy dirt. Money has been tight enough that I haven’t bought dirt until recently. Maybe when people ask me how things are I should tell them I can finally afford dirt. The good news was the the wire stands worked, as long as I made them wide enough (to keep from blowing over), but not too wide (which put the bottom of the pot within reach of a stretched slug). The plants grew! I even got fancy and bought some chicken manure mix to help them along – and helped them too much. The plants basically burned because the soil was too nutritious. I’ll probably get a half dozen tomatoes, about the size of a handball. The peppers are doing better, at least for the stems and branches, but the peppers are small and may not mature before the end of the season. The gourds weren’t for eating, but hey, why not try growing a mug? I might get a thimble.

Potatoes
Somewhere down there are potatoes. In the various places I planted them, the potato plants did fine – for a while. Then, everyone seemed to eat them. This has happened before. What’s also happened is that I found a small harvest under each. East some. Plant some.

Ginger
Last year I grew ginger indoors, and it did better than I expected. When the summer got hot, I put them outside to soak up the warmth, and they seemed to wither. But, just like with potatoes, it is hard to know what’s going on underground. So, I brought them inside. From one shoot came two, and now there are three. They’re tiny, but I’ll encourage them.

Mushrooms
Mushrooms grow when mushrooms want to. I planted, er, inoculated some logs over a year ago. The mottling makes it look like something good is happening; but the logs got so dry that the bark peeled. No reason to give up hope. I just watered one and set it in the ground to see if some contact with dirt will inspire some fruiting.

Aloe Vera
dsc_6748No, I am not planning to eat aloe vera (but pass along a recipe if such a thing exists.) From one donated plant, I’ve given away eight, and have at least fifteen more sitting in my living room window. The original is so happy that it sprouted a flower spike, something I didn’t expect. The flower stalk is over three feet long. I’m surprised some hummingbird hasn’t tried to break in to say hello.

Frugality
Here is where the question comes around; “Was the garden worth my time and money?” I know plenty of gardeners whose gardens produce as much as 80% of their food. For them, it is definitely worth it. Growing things is not an obviously profitable venture, though. If it was, farmers wouldn’t have such a tough time. My garden mostly produced apples and figs, which are tasty. The rest of the crops were encouraging, but not very productive. The most produce came from the plants that required the least tending. The plants that used the dirt, pots, stands, and watering produced a few things; but it would’ve cost less to buy them from the grocery. On a strictly objective analysis, I should spend more time working and less time gardening.

And yet, I’ll continue to plant things. I want to grow things. Convenience, emergency supplies, knowing what goes into my food, an appreciation for farmers, a nice greening of the property, and an easy opportunity to learn are all reasons why I’ll continue. As I learn more, it is easier to produce more productively. I do best with perennials. Good. I like fruit. I’ve gone from not growing fruit, to growing fruit but not vegetables, to maybe growing both and more. That’s personal growth, and that’s valuable.

I like to plant things. Usually, I plant ideas. They don’t always grow, either. They take a lot of tending, and sometimes find fertile places to grow – like in a similarly minded person. Ideas are perennial. That’s my strength. The results aren’t as quick and obvious as bed of zucchini (picture that), but they can be sweeter and last longer. This harvest is mostly over, and yet, I know that there are an unknown number of potatoes in my yard, ginger that may appreciate its change in location, and mushrooms that may mushroom. Part of my litany of optimism comes from similar plantings, ideas that I tend, that are coming along, that may yet send up a impressive spire or mushroom unexpectedly. In the meantime, I think I’ll get some better fencing.

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A Perfectly Imperfect Equinox

dsc_6714Oh, well. That’s close enough. My house has a Stonehenge moment every equinox, almost. On the equinox, the sun hits the horizon due west, putting it over a point of land across Cultus Bay called Scatchet Head. As it sets south of west for the next six months, I’ll get to see it set behind the Olympic Mountains. That’s true, but not exactly. A string of caveats describes the imperfections in my celebration; but that’s okay. That’s normal. Perfection isn’t. Accepting the difference is almost invaluable.

I can’t say the difference is invaluable because someone can figure out a way to value it. I’ll let them. I want to spend my time getting some other things done.

The Sun doesn’t set behind the Olympics. The Sun is traveling through space, but it is Earth’s rotation that rolls the Olympics up and into my view of our local natural thermonuclear reaction.

The photo is of sunset (an imprecise word, as I’ve just demonstrated) on September 21, 2016. That isn’t the equinox. The autumnal equinox will occur at 7:21AM PDT on September 22, 2016. So, the photo is about twelve hours too early; but sunrise (an equally imprecise word) happens on the other side of a ridge behind my house. The photo wouldn’t be the same.

I should get six months of sunsets, but I won’t. I live by the Salish Sea on the eastern shore of the Pacific Ocean. It rains here, in case you haven’t heard. It actually doesn’t rain much compared to many places, only about 36 inches per year. That’s imprecise, too; because within a short drive the weather goes from desert (less than 10 inches per year) to rainforest (over 120 inches per year.) I think my neighborhood gets about 50 inches per year, but that’s an imprecise measurement based on a memory of what a local weather fan reported. The biggest barrier to watching sunsets is the series of clouds that will sweep across the area during the autumn and winter. Potentially, I get about 182 days of sunsets. Realistically, there are far fewer. There are no exact measurements of the exact number of sunsets from my house because I’m the only one who can measure that and I haven’t done so.

I’m pondering (im)perfection because the topic has come up in several conversations. There is an infinity of room on a scale of totally perfect to totally imperfect. Totally perfect doesn’t exist, unless you accept something as it is, like accepting your or anyone’s imperfections as perfect representations of themselves. Totally imperfect doesn’t exist, either. Absolutes don’t exist. Even perfect vacuums have been found to contain random particles on a quantum scale. The great infinity between the extremes is where debates, decisions, choices, and progress live.

One thing I enjoy about consulting is helping people make those choices. Where are we relative to good enough? Is it time to make the commitment? Should a few more uncertainties be resolved first? The answer is rarely the same.

Within my life, I’ve had to exercise balancing imperfections much more in the last few years. The fewer the funds, the greater the need to deal with what’s available. With more funds it is easier to test ideas, experiment, and search for more options. My book, Walking, Thinking, Drinking Across ScotlandWalking Thinking Drinking Across Scotland was published early because I had an immediate need for money. Polishing the manuscript was a luxury I couldn’t afford because I had to afford food and shelter. It is an imperfect book; but then, they all are – even the prize winners and best sellers.

This week some imperfections appeared in a storm window I made. I have only one window facing south. Our strongest storms come up the Sound from the south. They build strength over the water and blast the southern tip of the island. My poor window was battered. I couldn’t and can’t afford to replace it; so, for years I’ve taken a hint from the previous owners. They replaced the screen window with a sheet of heavy plastic wrap. Between being beaten by the wind and rain, and getting irradiated by the Sun’s UV rays, the plastic only lasts about nine months. It was a solution, but an imperfect one.

Summer is over, or will be within twelve hours of the publication of this post. Within the last week the plastic developed rips on rips. Tape on tape wasn’t enough. Another layer of plastic might work through the winter, but the frame had been stapled so many times that the wood was splintering. After months of considering this inevitable event, I decided to try for another solution.

  • Solution 1) Repair the window and frame. = Too expensive.
  • Solution 2) Replace the plastic that came off a roll with a rigid sheet of plastic. = Expensive enough that the helper at the hardware store laughed before he told me the price. (It’s a big window.)
  • Solution 3) Celebrate a bit of good luck. A neighbor gave me his house’s old windows. = Great! But none of them fit. Cutting them to fit should work, but all I proved was that I can turn one piece of glass into two or more, but the breaks are curves, not lines.
  • Solution 4) Buy old but clean glass and get a professional to cut it. = Back to expensive, again. Not as expensive; but bad enough.
  • Solution 5) Buy the most economical sheets of acrylic I can find. Get a professional to cut them. Create a jigsaw puzzle of pieces that fits the frame. = My solution.

Finally, a semi-permanent solution just in time for the next set of storms; and hopefully, until my finances improve enough to rebuild rather than repair in patches.

Without much thought I can think of six projects that involve me that are in the decision making stage. Each is approaching the process differently. None can know if they’re making the right decisions. That’s what the future is for. The only way to find out is to try, as long as you can try again.

dsc_5027-copy

Autumnal Equinox 2014

That photo of the sunset at the top of the post isn’t perfect, either. A Facebook friend reposted my photo from a previous autumnal equinox. That was much better, I think. And yet, all I had to do to get a better photo for tonight was to ignore the sunset on the horizon and see the effects of the sunset on the sky.

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Autumnal Equinox 2016

As for the storm window, it is holding; though, we haven’t had a storm in the hours since I installed it. It will be interesting seeing how well it will work. For the first time in years that room is bright in daylight. Acrylic is clearer than plastic sheeting. I’m a bit worried because of my technique. I glued the acrylic to the wood storm window frame using the adhesive suggested. Unfortunately, I didn’t realize acrylic sheets have protection plastic on both sides. I took off the protection on one side – and unknowingly left it on on the side that was glued. I didn’t glue the acrylic to the wood. I glued wood to the protective coating that hopefully will remain stuck to the acrylic. It is an imperfection; but if it succeeds, it will be perfect enough. And if not, I’ll try again.

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Barclay Lake Revisited

The loudest noise was a minnow jumping. That’s when I knew I was in the right place. Life has been hectic, lately. Sound familiar? My schedule almost lined up with the weather. Postpone a meeting or two as the last sweep of sunny, dry weather was being chased out of town by a forecast for rain, rain, then showers, showers, showers. Backpacking replenishes my batteries, reminds me of the essentials, pulls back the facade of civilization for a peek at reality. Camping isn’t free, it isn’t cheap, but it can be sweeter than a suite – especially when there are no bugs, and just a bit of adventure.

Believe it or not, about 25 years ago I managed a full time job as an engineer, had a house, and somehow managed to hike three weekends out of every four with one or two of them being overnight trips. How did I ever do that? 1) Overtime helped. It provided the extra cash for gear, supplies, and licenses. 2) I was young and single. I shouldn’t have been in a house. I bought it because I should; which also means I didn’t keep it up to suburban standards. Overlook a few imperfections here, get more chances to play out there. 3) As tight as money was thanks to a big house and a big mortgage, in retrospect I realize I was being very frugal. I spent my money and time on the things that were valuable to me, even if they confused my family.

Lately, I’ve been working seven days a week. Yes, I know that most of you know that, but one of the purposes of this blog is to chronicle the life of one person as they navigate their financial journey. Thanks to my Rule of 7, I’m working seven days a week – with a slight allowance for a day off every two months. As most sole-proprietors know, a day off is one day of lost revenue that has to be made up for before and after, or decide which bill doesn’t get paid. I’m glad I have enough of a cushion that I should be okay this time.

Screenshot 2015-01-20 at 16.26.46Several years ago, I completed a three book series about hiking in Washington’s Cascade mountains. I wanted to hike somewhere else, to put work a bit farther away, but loading up a bit of Thursday’s work on Wednesday meant leaving the house about 2PM. So much for hikes that involved long drives, hard climbs, and research. I realized my best choice was from the series’ first book, Barclay Lake. Instead of sleeping beside an alpine lake above the treeline and beneath the stars, I’d sleep within a temperate rain forest beside a drought-shrunken lake under a 6,000 foot tall spire of rock. It’s all good. And, it turned out to be a good place for relaxation and contemplation. Those aren’t action words for marvelous stories, but they are some of my most valuable experiences.

It is easy to dismiss Barclay Lake. It’s relatively low (2,430 feet), small (I’d consider swimming it if the weather was right), and can be overrun (unless you pick the right times to arrive.) The trail is only 2.2 miles and the elevation gain is only 200-500 feet. It is listed as a family hike because kids can get there (unless they’re distracted by the log bridge); so, “serious” hikers avoid it. Instead, I’ve seen tequila parties, kids with hatchets, and Huck Finn rafts using nature as a setting for some idea of fun. I tend to only go there after Labor Day or before Memorial Day. Then, it is so quiet that the chipmunks haven’t even tried raiding my food.

The road has a new layer of gravel, which is great; and a fresh set of washboards, which can be brutal. Drive slowly and watch for traffic. Since my visits for my book, they’ve installed a luxury, a rest room! The bushes are still there, too, maybe for traditionalists. Last year’s wind storm that slammed Dorothy Lake evidently slammed Barclay Lake, too. Thanks to lots of chainsaw work, the trail is clear, and many of the campsites are clean and open. The first toilet even looked new (and was refreshingly clean). I found the sign for the one at the inlet, but was distracted by something I’ll get to in a bit.

I was lucky. I had the lake to myself. My late start meant getting to the lake about an hour or two before sunset. By the time my tent was set up and water being filtered, it was time for a jacket and hat despite warm weather in the valley. I cold-camp, no stove, so dinner was cold pizza and a slim box of wine. And silence. Camping beside a babbling brook is nice, but I’ve also found myself wanting to turn off the faucet in the middle of the night. Minnows jumping were the loudest noise, except for the occasional slight breeze that make me wonder what was out there.
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Barclay Lake has an impressive drop in level as the summer goes by. An eight foot drop in such a small lake is dramatic.  I agree with the ranger’s notes that it was probably at its lowest, which meant plenty of beach camping possibilities. I stayed to the trees for a more level surface. That also meant there was no water in the stream, just lots of weathered boulders under the log bridge.
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No people. No bugs. No noise. Just what I needed after two months of working without a day off.

The second day wasn’t as quiet, which is what happens at Barclay. Just as I got to the inlet (where I found the sign to the second toilet), I heard something fall off the peak. It sounded like a tree being ripped from its roots. I swung back for a look and realized the sound came from a BASE jumper whose chute had just opened above me. I was worried because I couldn’t find him for a while, but eventually he hiked by and I checked to make sure no one else was flying. Being the only person at the lake also meant being the only person available if a 911 call was required.
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Plenty of folks came up for the day, several just walked their dogs. Another tent went up on the exposed sand bar at the outlet. After dark, another set of campers came in, stumbled into my camp site, and were a bit confused. I gave them directions to another site in case they wanted privacy. Before they found my tent, one of them asked the other how much weed they’d smoked. The answer came in the form of a question; “All of it?” I’m glad they found another campsite.

Thanks go out to the USFS and WTA work crews that maintain the trail. (For my experience working on the trail, check out my book.) Seeing the damage on either side of the trail was impressive. Nature does things in big ways.

I’m back home (duh). The gear has been dried, cleaned, and repacked for the next trip. Add those chores to the catch-up work and see why the hike takes longer than the hike.

Enough of my friends shake their heads when I describe backpacking. Cheers to those who use passages from my books as examples for why they’d never sleep in a sleeping bag, in a tent, on the ground, in uncertain weather, with rodents for neighbors. The moments of adventurers flying off mountains, or stoners bumping by in the night are the easiest things to describe; but, the real value comes from the boring moments that won’t show up in ads. They’re too quiet, too still. I stood on the beach and let my gaze drift from minnows to autumn colors to tilting back my head to take in the 3,700 rise to the top of Baring Peak. The peak has a cleft big enough to hold a battleship held vertically. It is amazing to stand there, know the lake was formed by a rockfall, and see cracks bigger than ships. And yet, the minnow swim by, partiers party, and a forest soaks up over 110 inches of rain per year until a windstorm knocks it down. Weeks of unprocessed thoughts unspooled with no agenda or schedule to hurry or dismiss them.

If I’d been treated to an indulgent couple of nights in a luxury suite in Seattle, I would’ve accepted because duh; but I also know that there’s more value to being quiet and still in nature and being reminded of my and our place in it. Time in nature is the greater indulgence and is far more affordable (even if it isn’t free.)

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Upscaling Whidbey

img_20160913_151554Those photos are mine. Well, they’re now the property of the WiFire Coffee Bar, the place where I’ll be part of an Economic Development Think Tank tonight. The setting is sweet (and artistically decorated, in my opinion.) The title is grand. It is all much simpler than it seems. A group of us have been inspired by the introduction of 10 Gig Internet service to think ahead about our community that is the south half of Whidbey Island. Others are more official, but sometimes unofficial conversations are more productive. 10 Gig is only one of the things inspiring me to ponder the future of Whidbey. I wrote about a few aspects recently, but more flow in. This will be an interesting shift that will be an exercise in adaptation instead of control; because, if you haven’t noticed, things seem to be getting out of control. Begin adapting, now.

One of my favorite gigs (not to be confused with Gig) is writing for Curbed Seattle. I’m a contributing writer for them, which means writing an article or two a day. Usually, the articles are a lighthearted perspective on houses for sale. The biggest and the smallest are typically the best stories. Sorry, suburbia. Occasionally though, I get to dive into unexpected trends, like the recent article about a possible shift in real estate from Vancouver to Seattle. I’ll leave the main story in the link above, which leads to an even deeper analysis in another article written by a local firm.

The short version is: Vancouver became unaffordable, possibly from too many foreign buyers; so, Vancouver began taxing foreign buyers; now, Chinese real estate agencies have cut back on Vancouver searches by ~80% while Seattle searches have risen over 140% in about a month. Because of immigration policies, there are citizenship advantages for foreign investments that exceed $500,000. Vancouver’s median real estate prices are 80% higher than Seattle’s. As much as we may think the Seattle area is unaffordable, we locals may find it is about to get an unexpected boost. Great if you’re a seller. Tough if you have to buy.

Seattle’s market has been extreme, and the impact has been spreading to surrounding counties. A few have seen over 20% increases over last year. Whidbey’s market is already speeding up. Rural areas by definition have fewer houses, which means lower supply. Increased demand, low supply, up go the prices. Zillow has been increasing my home value since the beginning of the year, up $17,000.DSCN5593 (Professionals are allowed to groan at my use of Zestimate, but it is only tool I have available.). Of that $17,000, more than $6,000 has been in the last month. A $1,500 per week increase in assets helps swing fortunes. Do that for fifty weeks and see a $75,000 increase. While that may seem unrealistic, that would put my house’s value at $306,000, only $15,000 over what I paid in 2007 after the price had come down from $334,000 to $291,000. As a wealth creation model, that suggests a basic income that allows me to stay in the house is an enabler for passive wealth growth – as long as I’m willing to sell, at which point I probably couldn’t afford anything similar. Affordability drops. The outward migration will begin. The sustainability of the community diminishes even as its wealth increases, just like in Vancouver.

Set that aside for a while.

Thanks to one of the previous Think Tank meetings, I met a local entrepreneur, Ethan Worthington, who is working in the world of Virtual Reality (VR) and 3-D printing. (See his web site at ConsoleKiller.tech where he also creates gaming machines.) As I’ve said earlier, spending time using his VR rig gave me the same feel I had when AOL added a web portal to their previously closed environment. That prompted one of my best investments, which meant encountering months and years of jibes and scorn – until everyone else caught on. (Want details? Read my book, Dream. Invest. Live.Dream Invest Live cover) This time, I don’t have as much money to invest; so, I may invest my time. The ability to make something in virtual reality and make a 3-D print in the real world draws on a lot of experience I have from my aerospace engineering days. The ability to teach others about the experience is appealing, too.

The implications of Virtual Reality and 3-D printing was something I discussed in a previous post. Live near a bunch of big box stores and be able to buy almost anything you need, for a short drive, many lights, a long time parking, dealing with lines, all to buy something where the packaging costs more than the product. Live on an island and either add on the price of a ferry ride, a long drive, or buy online and possibly pay for shipping and then figure out how to get rid of styrofoam peanuts. Islands, therefore, are particularly appealing places to embrace 3-D printing. Skip the drive. Skip the wasteful packaging that would just have to be shipped off the island for disposal. Buy just what you need, and maybe get it customized, too.

Ethan is the expert, an artist, and far more talented than me in that realm. And yet, just like with the early Internet, the breadth of applications and opportunities grows as more people become involved. The ability to design, produce, and sell things for fellow islanders is appealing. The opportunity to sell the designs throughout the world is an marvelous market. I already have remote clients, and do most of my work online with off-island people. That may begin to happen in Virtual Reality as well taking screen sharing to a new level. While Ethan expands his business, I may find a new venue by using his gear, at least for now. With the addition of extra wearable sensors, I could even return to one-on-one personal training in karate. Much safer that way, too.

The two stories (as many other trends) will influence each other. Tech workers in Seattle may find it easier and cheaper to work from Whidbey thanks to the 10 Gig Internet service and the island’s lag in real estate prices. With more workers on the island, the local economy won’t be as reliant on retirees and tourists. With new business opportunities that support the community while also bringing more income to the island, the local economy and lifestyles become more sustainable.

Of the two, the real estate trend is less controllable because economic pressures are driven by wealth, and right now wealth is flowing as it seeks safe havens. (One measure of the confidence in the world economy is the flow of funds out of certain countries and conventional financial investments into things like real estate, which has just been proven to not be as stable as before.) Vancouver built a monetary dam that diverted instead of stopped the flow. The wealth is headed this way and has been thanks to Seattle’s healthy technology industry, and more wealth may flow along with it. As it does, people like me may have to find new ways to stay where we are, or sell and move. One way to minimize the moves is for people like myself to exert a bit more control over our own lives, and hopefully stay ahead of the trends.

The Think Tank meeting starts in under an hour. This post may not get the normal level of formatting as I rush to publish in time. Things are moving quickly. My adaptation has just begun.

 

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