On Mortality

I recently read a profoundly challenging book, Being Mortal by Atul Gawande. My son thought I might enjoy it. He was surely aware of my strong aversion to anyone using heroic methods on a faint chance of reviving my body if it is obviously failing. Years ago I completed an advance directive clarifying that I declined all medical treatments unless there was a reasonable chance that I would return to a somewhat normal life. And for clarification, institutional life does not qualify as normal life. I'm terrified of pain and helplessness, but I'm not afraid of dying.

My wife and I have been through three protracted deaths of our elderly parents. Two declined treatment for their incurable illnesses. One died in the same bed she had slept in her last nine years. The other moved from his home to hospice care where he lived a couple of weeks. Neither experienced tubes, ventilators, monitors or intravenous lines, with accompanying beeps and buzzards  and other accoutrements of modern medicine. They only received pain killers as needed to keep them as comfortable as possible.

Unfortunately, my step-father slipped into the horrors of modern medicine's penchant to value life by the number of days that you breath. So after a hideous operation that should have never been performed, he was tortured for two months in an ICU until death finally relieved him.

Mr. Gawande does a wonderful job introducing us to the reality of death in modern society. He explains how we got here and how wrong it is, and then shows us some of the options that are available to help us bring back some dignity to the elderly and their dying. In the introduction to his book, he does such a great job summarizing our current condition that I've taken the liberty of quoting it heavily.

"Modern scientific capability has profoundly altered the course of human life. People live longer and better than at any other time in history. But scientific advances have turned the processes of aging and dying into medical experiences, matters to be managed by health care professionals. And we in the medical world have proved alarmingly unprepared for it.

"When I became a doctor, I had never seen anyone die before and when I did it came as a shock. The shock to me there was seeing medicine not pull people through. I knew theoretically that my patients could die, of course, but every actual instance seemed like a violation, as if the rules I thought we were playing by were broken. I don't know what game I thought this was, but in it we always won.

"Death, of course, is not a failure. Death may be the enemy, but it is also the natural order of things. There's no escaping the tragedy of life, which is that we are all aging from the day we are born. One may even come to understand and accept this fact. I am in a profession that has succeeded because of its ability to fix. If your problem is fixable, we know just what to do. But if it's not? The fact that we have had no adequate answers to this question is troubling and has caused callousness, inhumanity, and extraordinary suffering.

"This experiment of making mortality a medical experience is just decades old. It is young. And the evidence is it is failing.

"This is a book about the modern experience of mortality - about what it's like to be creatures who age and die, how medicine has changed the experience and how it hasn't, where our ideas about how to deal with our finitude have got the reality wrong. I find that neither I nor my patients find our current state tolerable. But I have also found it unclear what the answers should be.

"You don't have to spend much time with the elderly or those with terminal illness to see how often medicine fails the people it is supposed to help. The waning days of our lives are given over to treatments that addle our brains and sap our bodies for a sliver's chance of benefit. They are spent in institutions - nursing homes and intensive care units - where regimented, anonymous routines cut us off from all the things that matter to us in life. Our reluctance to honestly examine the experience of aging and dying has increased the harm we inflict on people and denied them the basic comforts they most need.

"Talk of mortality raises the specter of a society readying itself to sacrifice its sick and aged. But what if the sick and aged are already being sacrificed - victims of our refusal to accept the inexorability of our life cycle?"

This is a book well worth reading to anyone who may be facing this end in the next few decades.

A Wild Ride

I grew up in the Upper Peninsula of Michigan on the Marquette Iron Range, the smaller of two active iron ranges in the Lake Superior basin. My grandparents immigrated here from Finland over a hundred years ago, seeking a better life in one of the most formidable climates in the world. The mines have run continuously since 1847, owned by Cliffs Natural Resources since 1890. My grandfather, father, several uncles and many neighbors worked in the mines. Then it was called Cleveland-Cliffs Iron Company, abbreviated CCI. The workers said they "live and die for CCI."

Two years ago, Cliffs caught my eye. It seemed to be doing well crawling out of the Great Recession. As I always do when considering a stock to buy, I went through their financials, which looked good: Low PE and price/book, strong cash flow and a solid dividend. I've maintained that the world, especially developing countries, is growing fast and will continue to use more iron, copper and other commodities as they join modern life.

So I purchased Cliffs and watched as it lost 92% of its value over a year, bottoming out at $1.32 on January 12, 2015. I then watched again as it went up 12 times. And today, as I did years ago, I went through their financials and decided that it does not meet my requirements for a healthy company. So I sold it, just barely recovering nearly all of money. Meanwhile, Seeking Alpha says Cliffs is "ready to rumble." We'll see.

What did I learn from this whirlwind ride? Reviewing their SEC filings from when I purchased them, I can see now that some of their financials looked too good to be true. So a lesson might be to be careful adding up the numbers. It is helpful to also have a sense of where the company and industry are headed. Of course, a Monday morning quarterback is always right.

 

Otherwise, I didn't learn a lot. Mining is a capital intensive industry but like every sector, it has its strengths and challenges, which I would assume are accounted for in its price. Should I have sold after it lost half of its value? Well, that would have been costly. I'm especially glad I didn't sell it at its bottom, but I wonder if I would have considered buying Cliffs at less than $2/share when I wouldn't consider selling it.

Buying individuals stocks is a risky business. My theory is that stocks don't force me into overbuying into overpriced equities, as indexes do. But the downside is losing - and possibly gaining - a lot of money. Which is why most of my equity purchases are in indexes.

How Not to Apply for a Job

This past week, as I have done for years, I looked closely at several applicants for positions we are trying to fill in the tech industry. All have some valid skills that may appeal to us. However, I am slightly shocked at the basic errors made by applicants. If you're looking for new work in any field, here are some thoughts.

The most obvious problems come in the resume itself. Usually, it starts with too much information. I just read a resume that lists forty different skills, about thirty more than I can process. Applicants seem to forget that few will study their resumes - we scan through them in tens of seconds. They regularly go beyond two pages, which is usually too long. The resumes are often unclear on where and when they have worked or attended college. Resumes should contain plenty of concise, concrete information that can later be expounded on, but not a lot more. A related problem is the over architected resume that is wonderful to look at but often lacking in critical information.

A major miss from applicants is their LinkedIn page, or lack of. A LinkedIn page is Step One in any modern job search. Open a free account, complete the profile and be sure to include a picture. List all education and professional jobs. Provide dates for the past ten years and account for any blanks. List organizations, interests and personal data. And while you're at it, join a couple of groups. LinkedIn walks you through this rather easy process. Finally, get 50-100 connections before you send out a single application. It's not hard to do. And then "follow" the organization you are applying to. Again, I'm amazed by applications that do not provide a LinkedIn profile, and if they do, obviously threw it together in thirty minutes.

So what to do with problems, such as a bad GPA? Try to avoid highlighting negatives but be ready for an explanation when asked. Don't lie or hide - you will only dig yourself a bigger hole. But remember that everyone has a problem with their resume and still over two hundred thousand people were hired last week.

In the end, though, don't lose sight that your resume or LinkedIn page will never get your hired. It's your skills and experience that get you a job.

Christmas 2016

The big news for 2016 is David's college graduation. We've paid our last education bill and the kids all have degrees and jobs. David and Ben now share an apartment in San Francisco, both working for Thumbtack.

David graduated with a double major in mathematics and computer science. While in college, he took four years of classical piano. In his junior year, he started Russian and now reads, writes and speaks it quite well. He spent his last quarter of college with fellow students at Moscow State University. Ann, Ben and I met up with him in Russia when he finished in June and spent a week touring Moscow and St. Petersburg, and then another week in Finland. The trip was wonderful. David was our personal guide and translator, bringing us to great restaurants and endless sites. Russia is this northern land, in many ways similar to northern Minnesota, a land that time forgot. The Orthodox churches are simply amazing. The history is at once horrifying and inspiring, and sent me off on a Russian reading campaign. No, Putin and I aren't Facebook friends, but I've gained a new appreciation for their situation. But regardless of politics, the story of one of the most consequential countries of the past two hundred years is riveting.

With kids in Texas and California, holidays have become a bit more complicated. For Thanksgiving, Ann and I spent over a week in SF at an historic hotel a block from Ben and David. Ann and David made Thanksgiving dinner in their apartment, including homemade apple pie. Our hotel suite was roomier than some apartments, so hanging out there was fine. We took a short road trip down the coast. Ann and I become comfortable walking and taking the bus around most of SF. We found a Starbucks nearby that opened by 5am (haha) – and sold the New York Times. I might retire in that hotel.

For Christmas, everyone is coming home for up to ten days. We’ll spend a couple of days at our place in Lutsen, MN. The kids are then all flying out together to SF for another week together.

Ann and I have done well at home. I’ve joined Ann working our gardens. I had forgotten how much I like yard work. I remember as a kid so enjoying our yard and our land in Michigamme. We landscaped our gardens (including deer proof fences) and now have raspberry and asparagus patches. We also grow beets, tomatoes, peas, lettuce, beans, hot peppers, squash and herbs. The peas sometimes grow taller than me. We also planted plum, cherry and apple trees in the yard.

Ann is now the state rep for northern Minnesota for Celebrate Recovery. She stays in touch with the couple of dozen other CR's in her region, plus travels to short and long summits around the region and country. I usually travel with her. I continue to run the music with the help of over twenty musicians. I returned to playing my now twice reconditioned guitar I bought in college. It has new electronics and a series of pedals. I'm also the primary vocalist, which is new territory for me. Ann and I lead groups at our weekly meetings. We also have after hours closed groups that spend a year walking people through an intense 12-Step recovery program. It includes a series of workbooks that can move almost anyone closer to a personal objective that improves their lives.

After talking about it for over ten years and after sending out over seven thousand Tweets (@JonJosephA), I set up my blog, Confessions of an Investor (InvestorConfessions.com). I'm actually getting a little activity on it. I've made connections with people overseas and was even interviewed by some guy from Bloomberg News. It’s a start.

Merry Christmas and Blessings to You,

Ann and Jon

An Irrationally Exuberant Call to Action

I was excited to read Robert Schiller's 3rd edition of Irrational Exuberance. He's famous for calling both the internet and real estate bubbles. Somewhat predictably - and justifiably - he's quite concerned that after tripling from its lows in 2009, the US market is again in a bubble. The book is a wonderful read on how stock markets, bond markets and real estate markets all can get into bubbles and busts. He exhaustively makes the valid case that there is no such thing as a rational market.

OK, I buy it. I've lived through three market crashes and watched the horrors of the most recent six year real estate crash. I realize that nothing is supporting the value of my house, retirement and even my dollar bills except what others perceive it to be. I also realize that there is no supposedly secure place to rest my life's savings. Like so much in life, there really aren't any guarantees. Waking up tomorrow is only a bet.

But I looked forward to Mr. Shiller's last chapter, A Call to Action. I don't like being acted upon, far preferring to take action. Here's where I hoped to learn some tips for dealing with the vagaries of markets.

Well, that wasn't to be. The Call to Action is at best some ideas for government and leaders that may soften some of the harder edges of bubbles and busts. He encourages leaders to help people through these rough times, even while he acknowledges that views that a market is over or under priced are never universally held. He says that monetary policy should "gently lean" against bubbles, but he also says the Fed probably shouldn't try to burst a bubble through aggressive tightening. This is pretty timid action.

He suggest that opinion leaders should offer stabilizing opinions. That institutions should encourage constructive trading with tools such as circuit breakers. That the public should be helped to hedge risk. The public? Helped? Hedge risk? Who can do this, and how and when?

For us, the individual investors, he rightfully suggests we not pull investments out of the market in favor of bonds, and that we shouldn't be "lulled into complacency," that things can go bad.

So the call to action is mostly little or no action, which is about how I handle busts. Minimize your risk, primarily by keeping close to a fixed allocation, by saving regularly and by responding little to bubbles and busts except to reallocate to your original plan.

I still highly recommend this book. If you believe him, you will understand why you can't take a lot for granted; you can't assume any stock, bond or house is necessarily going to rise predictably according to some formula. Instead, they can all float in time and space at various valuations, and you can only live assuming they will eventually probably go somewhere good.

And for assurance, keep up your health, relationships and interests. Even with the best of planning, you may one day find that's about all that you have.