The Retirement Bubble

It was the 70’s and, with the success of Toyota and others, all things Asian were of increasing interest to Americans, including me. How I came across a book on the Japanese health practice of shiatsu, I don’t remember now. Shiatsu, sometimes called “acupressure” in English, follows the system used in acupuncture, but uses pressure on the acupuncture points, instead of needles.

The book was well-written and really impressed me. Although the idea had never crossed my mind before the book, I decided I needed to know more, so I contacted the institute that the author ran in New York City and inquired about an introductory course. I got the information, packed a bag, left Washington DC where I lived, and spent a weekend being introduced to the practice of shiatsu. I liked the sensei (master teacher), my fellow classmates, and what I saw and experienced, so I took a week-long course a month or so later. After nearly three years of training, a week here, two weeks there and so forth due to my work schedule, my teacher told me I was sufficiently competent to offer my services to the public for money, if I chose to.

I was doing short-term consulting work overseas at the time, but I had periods when I was at home, waiting for a new assignment, and money was tight. Maybe I could find a way to practice that wouldn’t require my continuous presence. After all, I liked what I was doing and I had put a lot of time, money, and effort into learning, so providing it as a paid service would be a nice addition to my income, as well as a chance to get broader practical experience.

I asked around the “alternative lifestyle/health” community of that day (much smaller than it is today) and was introduced to a young lady who was setting up a center for various forms of legitimate massage therapy and was happy to have shiatsu added to her options. She charged me only for my use of the facilities, thus it was not a major expense, and I was earning income while I was incurring the expense anyhow. So, rather suddenly, there I was with a room which I shared with other therapists and a “practice”. Naturally, I had to advertise it, although the center’s ads helped too. Soon enough, I had clients, a few at first, followed by a growing number. As I remember it now, I believe my charge was $45 for an hour’s appointment, about average or just below for such a service at that time. I wouldn’t be surprised if it wasn’t more expensive today.

I took my work very seriously and got a reputation for that, although I was not aware of that immediately. I would not work with someone where there was any chance that shiatsu might make the condition worse, someone with a back injury for example. If after an initial discussion with the client or after working with them, I decided that shiatsu was not the best approach, I would recommend other professionals, including physicians when appropriate. I insisted that clients reserve and pay for one session at a time, no “packages” of five or ten pre-paid and non-refundable sessions, as was very common practice then. I knew that a single session was unlikely to have much impact and I would explain that, but I felt it was the client’s decision whether to continue, not just a matter of “using up” their package. I accepted payment only after providing the therapy and only if the client felt it had been worthwhile. Let’s just say I was an unusual massage therapist and it did not go unnoticed. So much to my surprise, a couple traditional physicians sent me their patients in the hopes that I might be helpful and provided me with a summary of the client’s condition so I could judge whether I wanted to proceed or not. That was very uncommon behavior on the part of traditional physicians back then, so I took it as a great compliment.

After nearly a year, I closed down my practice. It simply conflicted with my overseas consulting, my primary source of income, and I was constantly having to apologize to clients that I would not be able to see them for a month or so. That got old fast. And frankly, there are members of the general public to whom I was introduced who I could easily get along without meeting! They were very few in number, but there are some folks who are just not right for this therapy. They were often emotionally upset for one reason or another and just completely misunderstood what I could do and could not do. But it was the schedule conflict that really made it impossible to continue.

Despite the occasional problem client, I left with many good memories and have never regretted the practice, but I put it behind me at the time and focused on my other work. Although I no longer had a practice and thus did not advertise it, I was to receive phone calls every month or two for the next two years from people who had been referred by past clients or others who had heard of my work. That always came as a surprise, but if I had the time and our phone conversation convinced me that they were serious folks who could potentially benefit, I would do my best to meet their requests.

I suspect you can guess why I am recounting this, but let me summarize quickly:

– I needed extra income.

– I found something that really interested me and that I enjoyed doing, although I had absolutely no background in that specialty.

– I found a good teacher and spent a substantial amount of my free time to learn the practice properly.

– When I was ready for it, I took my public practice very seriously and set high personal standards for ethics and professionalism.

– Without purposely trying, I got a good reputation for my work, far broader than I would have guessed and undoubtedly based on everything listed above, as many told me.

– If I had no other source of income and had put my mind to promotion, it could have provided me with a modest living and possibly more.

– Although I closed my practice, I took with me valuable lessons in everything from dealing with the general public to operating a small business that have remained with me ever since.

– Although it had nothing to do with retirement and was not a Life Sabbatical, per se, it followed the Sabbatical guidelines and they provided the results in an identical manner.

So today’s story is not someone else’s story, but my own for a change. I have a couple more I may share, but I think this one is the most relevant. And by the way, I no longer provide shiatsu (this is a note to folks who live near me now and read this). I would have to go back and relearn what I have forgotten after all these years.

But the lessons learned are every bit as valuable to me today as they were more than three decades ago. I hope they are of some value to you too.
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Last December, I wrote in an essay, Staying Off Our Backs, that focus was important, however, “that focus can become something we have a different term for in English – tunnel vision. That means the focus has become so intense that we may miss other factors that are important, or notice them only when it is too late to do anything about them, or if we see them, to give them too little serious attention.”

I have said here that I do not enjoy raising negative possibilities, but wish to emphasize the positive, and I have every intention of continuing to do that. But ignoring the negative does nothing to help when talking about future scenarios. Discussing why something or someone in the past was wrong or did the wrong thing is of little use to future planning, beyond the simple reminder not to repeat past mistakes. There is more than enough of that kind of negativity going on already. Discussing the negative factors existing right now, today, and having a bearing on our futures is more acceptable, but still has to be dealt with carefully to avoid unnecessary conflict among people of different viewpoints.

However, thinking about potential negative factors or events in the future can be very useful. For example, I talk about the likelihood that we will live to a far older age than most of us think likely right now, thus greatly extending and expanding our financial requirements. I also talk about the likelihood that depression can be our worst enemy in the future, if we find ourselves without resources and no practical way to gain them due to our decision to step out of the work world completely. I talk about the possibility that government funds either will simply not be available when we need them or that the taxpayers may decide that other groups, the young for example, deserve priority. These are all negative possibilities and mentioning them is not meant to depress us, but to help us break free of that “tunnel vision” and take into account factors we might not otherwise consider or give little attention.

I seriously doubt there are any Americans (and most others as well) who are not aware that their nation is facing huge government deficits and a rapidly rising total government debt burden. How all this debt is to be paid for is a serious question that leads to a wide range of responses, but everyone can agree on the basic fact that the debt is huge, growing rapidly, and will take a very long time to pay off without destroying the value of the US dollar. The graph below, taken from Wikipedia’s entry on the US budget, helps provide us with some perspective on the issue.

The US is not alone. Just as many people are probably aware that Greece is currently going through a national trauma of the first order as it struggles to deal with a government financial situation that is worse than that in the US and most other nations. It is difficult to see any relatively easy or painless remedy to the Greek tragedy being played out before us today.

But Greece is not alone either. There are a number of other European nations facing severe financial challenges. One of those is Ireland. They are one of the worst-hit economies in Europe, but they have not provided the melodrama we see in Greece with angry demonstrations, riots, and whatever else some Greeks can come up with to make their anger known (with kudos to the majority of the Greek people who polls clearly show accept the financial reality and support efforts to deal with it constructively, despite the pain). Today, the Greek parliament passed an austerity budget that will be very unpleasant, but, if implemented, can make a big difference. The question is, of course, will the Greek people accept it and survive it without tearing their nation apart? I sincerely hope so, but that is to be seen.

Ireland, on the other hand, already has its austerity budget in place and under implementation. It is a very tough budget and it means drastic cuts in services that the Irish people have taken for granted for a long time. So this gives us, whether as Americans or citizens of another nation facing difficult choices, an opportunity to see what results from a genuine austerity budget.

The folks at BusinessInsider.com have prepared a very simple and straight-forward series of “slides” to describe what the Irish austerity budget looks like and how a similar American austerity budget might look like, should the day come when Americans decide they have to do something to cut spending as dramatically as they are now currently raising spending.

Their presentation has nothing directly to do with retirement, although it is briefly mentioned. Indeed, the Irish cuts that directly affect retirees seem quite modest compared to some of the others, but the it is the total impact that we have to understand, as well as how the rest of the Irish may feel in the year to come on the subject, are retirees taking their fair share of the cuts? When you have children with needs, that can be a serious question. But the important thing is to set aside tunnel vision and open your mind. We all talk about “cutting spending” to deal with budget deficits, although we may greatly disagree as to what to cut and how much to cut. Ireland is a nation that has not simply argued about it, but done it. Let’s look at the results.

So here they are. Wherever you live, take a moment to consider this lesson from across The Pond. When planning your future, whatever those plans may be, if they depend in large part on government support, all the more reason to consider it very seriously.

I will be back on the weekend with another story of someone who faced a challenge of his own making, with relevance to the requirements of a Life Sabbatical, and how it worked for him.
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Let me take a few minutes to talk about a problem too many people face when they first start their Life Sabbatical, then an approach to dealing with it.

We have all worked for decades. We are used to jumping in and getting things done in areas as familiar to us as eating breakfast. Now we want to try and find something new, something we think we might really like doing. We want to investigate it, learn as much as we can, and decide if it is worth further time and effort. So many people I talk to start out with this in mind, then run into a wall of their own creation, taking all the fun out of the process and ending up more depressed than when they began!

The first error we often make is taking ourselves too seriously right from the start. We want to know it all as quickly as possible. We begin judging its potential for income-earning from Day One. For some strange reason, we feel we should learn how to perform it well in weeks or a few months, despite decades of past life learning that this is not how life works. Time becomes our enemy and if we cannot learn something new in a short time, we decide it will take too long.

We are our own worst judges. I cannot tell you how unreal it is to sit and here someone tell me that they got interested in something new, tried it out once and decided (judged) it as useless for them to continue. Yeah, I know, you think I am exaggerating for effect. One time and they give up? Oh yes, it definitely happens more often than you think. Let me give you one example, quite an unusual one, I think you will agree.

Jack had been a hurdler in college twenty years ago. Now he was in his 40’s and looking for new possibilities. There was quite a growing community of adult athletes growing in our metro area and there were possibilities there for a new business. He decided the best way to get into that crowd was to try hurdling again. He asked me if I thought he could put on hurdling shoes and actually get over any hurdles after all these years. I said, sure, he could do it, but he would need to find a place to practice and put time and effort into it. If he did, there were Masters track meets where adult men and women competed as seriously as at any college. There was a whole variety of networking opportunities in his potential market, and there was no better way to be introduced than on the track itself. He looked pretty excited and told me he would give it a try.

I saw Jack a month or so later, having forgotten our earlier conversation. While we were talking, he said, Bob, do you remember when I talked about hurdling? I said, sure, I remember. Well it seems he had gone out the day after we had spoken and bought a brand new pair of hurdling shoes. He went to a local high school whose facilities were open to the adult public after school hours. There were ten hurdles up on the track. Jack warmed up and gave it a run. He told me that he cleared the first six without difficulty, just grazed the next two, and tipped the last two over.

I was so impressed! Wow, twenty years later and he does that well on his first try? Fantastic! But before I could open my mouth, he added, “I stood there and looked back over the hurdles and I told myself, who am I kidding? There’s no way I can be a hurdler again. So I threw out the shoes.” He threw out any idea of sports as a source for a new business along with them. End of story.

All these years later, I am still a little shocked at how quickly Jack could judge himself and convict himself as a failure so quickly. Jack was a very intelligent guy who had held very challenging executive positions, but when it came to himself, he just lost it. Jack is not alone.

Bill had a different problem, setting income goals too high, too fast. Bill was a good amateur furniture refinisher, having done it for himself several times. He was in his 50’s. Could he possibly make money doing this as a living? Of course, I told him he could. Good refinishers are not all that common and there is definitely plenty of business for a good one, but it would take more training and practice before he could expect to open a business.

I spoke with Bill a couple months later and the subject came up casually. I asked him what he had decided. He told me he had “checked it out” and decided that the income he might get after one year’s further training would not equal what he was earning now, at the top of his game in a field he had worked in for more than three decades. As a result, it was not worth the time and effort.

What? Like Jack, it was hard to respond to something so silly. What did he mean “checked it out”? How? And what did that have to do with him anyhow. He spends a little time reading some websites on refinishing and comes up with this, the decision not even to try? And worse yet, he is looking for a new career that will pay him in one year an income equal to what he was earning after 30+ years of hands-on experience? It is because of folks like Jack that I recommend the 30% Solution for people starting a Life Sabbatical or otherwise on a search for a new career who can support themselves as retirees now, but want to earn some income in the future. The percentage is unimportant, the point is to make your goal both modest and realistic when starting something new.

After working with people as long as I have, I now find it easier to spot this sort of thing early on and address it, but some people still fool me! I will forever be amazed at how harshly people treat themselves, and then convince themselves that they are being “realistic”. Hah!

So what to do about this? I tell folks who are at a stage in life, either voluntarily or involuntarily and of any age, when they can support themselves, but feel they will need income in the future to not to look for a new career. At least, not yet. No, begin by thinking of things you think you would really like to do and “get a feel for them”. Read more about them. Attend a lecture, presentation or event of some kind where you can learn more. Talk to someone who does it for a living. Just get out and get a feel for what it involves. Stay at that stage for awhile. If it really begins to look interesting, you can step it up and look for opportunities to learn more. If it doesn’t look interesting after awhile, get a feel for something else that interests you. Stop being so bloody serious about it in the beginning! Just open your mind to it, get a little taste of it, and let yourself judge it (and you) slowly. So six months later, you decide it is not for you? Fine, you have had a great experience, learned more about your real interests, and maybe come across something more interesting. Take that attitude and you will never be a “failure”. You will always come out of it with more than you had when you went into it.

Don’t step up to a new activity, grab it in both arms, and squeeze it to death! Just reach out and get a feel for it. You can embrace it later, if it feels right.
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Today, I have two difficult topics to raise. I am not happy to have to discuss them. I know that at least some of you, perhaps the great majority, visit my blog in the hopes of finding something positive and inspirational in a world filled with so much that is negative and far from inspiring. The purpose of this blog is indeed to inspire, but it is also to be honest in its analysis and sometimes that means looking at the downside of life today, along with the potential upside of life tomorrow. Have faith, the upside will continue to be the primary focus, but today the downside will receive attention.

Having properly prepared you (I hope!), I will refer you to one news service report and one newspaper article. I will describe each briefly, provide a link to the original, and let you decide whether this is something to read, or something to be set aside for another day. Both refer specifically to the United States and I apologize to my non-US readers for such an emphasis, but I also remind them that 1) what is said very likely applies to your nation as well, even if from a different perspective, and 2) we are all in this together. Those who forget that leave themselves open to even more pain in times to come.

The first is a Reuters news service report titled, “U.S. state pension funds have $1 trillion shortfall”. Reporting on a study done by the very well-respected Pew Center on the States, one of several “centers” sponsored by the non-profit, non-partisan Pew Foundation that deal with a variety of issues. It has great potential significance to readers who have a state pension in the US, but the same can be said of many private pension plans and even the federal government’s pension plan. In the federal government’s case, it can at least print the money to make the payments, even if that money is devalued by over-printing. But the individual states do not have that “luxury”. The depth and breadth of the pension problem is much greater than many people think. If you like, you can read the report here.

The second is a column at today’s Los Angeles Times titled “America, the fragile empire” and written by Dr. Niall Ferguson, a professor at Harvard University and Harvard Business School, and a fellow of Jesus College, Oxford. Dr. Ferguson is not just another academic. He is well-known among many in the global finance and economics community. He is also well-known for his many warnings over the years that the US was headed toward a major crisis. His solutions have always been intelligently written, although sometimes controversial. I respect him as I do a number of other economists capable of writing intelligently, but in a style that can be appreciated by any educated person.

His op-ed column today is very calm, but very serious, as he discusses one potential outcome of the on-going crisis to America’s future. But it also differs from most others. He does not mention any President’s name, past or present. He blames no one person or group for the current crisis. He mentions no political party or ideology. He mentions no specific law or regulation. In fact, he accepts the past, he does not try to dissect it. He proposes no solution. His conclusion is not a specific prediction. It reads like a general forecast, but that is not the proper word either. It is exactly what he chose to call it. It is a warning. Whether the future turns out as he warns it might, I do not know, but I take his words very seriously. If you like, you can read his column here.

Such it is for today! I do promise to do my very best to follow this with something more upbeat and positive! Thank you for your patience.
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It has been almost impossible, or so it seems, to ignore the media frenzy surrounding Tiger Woods and his private life, now so very, very public. I don’t find anything interesting, and certainly not inspiring, about this particular public melodrama. I admired Tiger for his golf. Anything about his personal life was his business, not mine, and I had no desire to make it mine now. So I decided I would not waste my time following this story, but focus on what I felt was truly important. Despite that, I found myself “checking in” every tenth article or so. I really don’t know why and that is the truth. There is simply nothing in his private life that has any meaning to me, personally or professionally, but check in, I did.

When Tiger mentioned he was a Buddhist and that he had strayed from his faith, I only then remembered that this was his background. Fine, that is his private business too.

Putting Tiger aside for the moment, let me mention another famous person, the Dalai Lama, Tibet’s religious and political leader and a very well-known Buddhist. As his recent visit to the White House demonstrates, one of many visits he has made to government leaders all over the world for decades now, the Dalai Lama is a well-respected man. If you actually read his writings and hear his words, he is also a very well-informed person and very open-minded. It was he who once said, “The mind is like a parachute. It works best when it is open.”

I do not play golf and I am not a Buddhist, but I have great respect for both these men for the contributions they have made to their vocations, one in sports, the other in religion.

I mention this today because Tigers’ story reminded me that these two very different men have two things in common, they are both very famous people and they both share the same religious belief. Therefore, it is no surprise that the media, when talking to the Dalai Lama, would ask him what he felt about Tigers’ situation; given that Tiger is a Buddhist. So it was with some mild surprise that I read this a couple days ago when he responded to that question.

“Tibet’s exiled spiritual leader told The Associated Press during a brief interview in his hotel suite in Beverly Hills that he had not heard of Woods,…”

What? He had not heard of Tiger Woods and his melodrama? How could that be? Was he embarrassed? I cannot believe that. Over the years, the Dalai Lama has earned a reputation for not avoiding difficult questions on the subject of Buddhism, among others. He answers them, typically in a very straight-forward manner. But I continued reading,

“….but when the circumstances were explained to him he said that when it comes to adultery, ‘all religions have the same idea. Whether you call it Buddhism or another religion, self-discipline, that’s important,’ he said. ‘Self-discipline with awareness of consequences.’”

Good answer. In my mind, it was very relevant to Tiger Woods’ circumstances. But it also reminded me that self-discipline is not just relevant to Tiger Woods and his circumstances, but to me and my circumstances as well. Even though I already “knew” this, it was useful to be reminded.

I could not count the times that I have said to myself, and others I know have said to me, “I really should do something about this. I know that, but I lack the self-discipline.” Oddly enough, it is not always said apologetically, but as a justification for inaction. It shows humility and that is positive, but it also shows failure to do what needs to be done, even to obliquely justify that failure, and that is negative, at least for me. That is sad.

I do a lot of things, set a lot of goals. Right now, as I write, I have to confront challenges to progress to one of my important goals that I really wish I did not have to deal with. I know that I have to deal with them and I know it will be difficult. I know that what I do not choose to do will eventually be forced on me anyhow, if I don’t do it now. But I still have problems and they really boil down to one thing, self-discipline. I would never have expected it, but Tiger Woods story, at least this one aspect of it, has led me to look at myself and recognize that self-discipline is once again my challenge, as much as it is Tigers’.

I am thankful that my challenges are not those of Tiger and I am not ashamed of them, but “self-discipline with the awareness of consequences” speaks as clearly to me as it may to him. The re-recognition of what I already knew from nearly 65 years of experience is useful to me today. So I thought I would share it with you, in the event that you find it useful too. One thing seems clear to me. It is essential to future planning, regardless of age, circumstances, or choice of goals.
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I will end with one totally separate comment. A couple of you have written me and said, “Bob, I wanted to send your essay to a friend, but when I went back to find it, it wasn’t on your homepage anymore and it took me quite awhile to find it (or, I couldn’t find it).” If you have one of these essays you would like to save, or share, but perhaps not immediately, then all you have to do is click on the title of the essay and a new window will open that shows only that essay. Copy the web address at that page and you will always be able to find it, and it is the web address you would send to a friend so they would see what you wanted them to see.
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I don’t remember all the details, but they are not important. His story is true and what lies behind it is the point that I want to make today. He was a university student in geology in the US state of Pennsylvania. If I remember correctly, a graduate student at Pennsylvania State University. It was the late 90’s and the Internet’s “world-wide web” (remember when we used that instead of just Web or Net?) was in its early stages. Websites were popping up, but they were few in number compared to today and most of us new website owners, including me, were climbing their own version of a learning curve as to how to reach people on the Net.

This young geologist-to-be was focused on the coal industry where he expected to work after graduation. He set up a very simple website. It was what we later called a “link library”, just a long list of links to websites on coal and articles on coal. Since he was researching for his studies anyhow, he was checking the Web every day and added whatever he found. He told some friends and they visited. Then more came from other universities. Finally, coal industry folks and related government agency personnel started visiting too. He began with a handful of readers, then dozens, then hundreds, then thousands, then tens of thousands and beyond.

Did he charge for the information he provided? No. Did he have paid advertising? No. Did he ask for or receive any money from site visitors? No.

Pretty dumb thing to do, right? No, not at all. I read about him, as I remember it, in the Wall Street Journal (a good indication of how well-known he had become) and I never heard what happened later. But when this young man finished his degree and walked into an office in the coal industry, looking for a job, he had something on his resume that no other new candidate could offer, regardless of their experience. I will bet he walked into offices where they immediately “knew” him, once they saw his website on his resume. Imagine, he had not worked a day in his life in a regular job, but he was better-known in the industry than pretty much anyone (probably everyone) he interviewed with. If that gentleman couldn’t parlay that website into a good job, I would be very, very surprised.

So, what does this have to do with you? As much as you make of it.

When that young man set up his website in the late 90’s, it took a lot of time, effort, and at least some technical knowledge. I know very well. I set up my first website in 1997 and it was no simple task for someone with no tech background at all.

Today, there are so many services providing “blogs” (just another kind of website), including the big ones like WordPress.org (this is a WordPress blog you are reading right now) and Blogger. They make it so much easier for a non-tech to set up a site that it borders on the ridiculous for those of us who started a decade or more ago. It takes effort, but people do it all the time and 99% have no tech background at all, none at all.

I am going to make an assumption now. I will assume that each of you has something that really interests you, but with which you have no training or background at this point. With a modest commitment of time and effort, you can set up an attractive blog of your own (for a small hosting fee at WordPress or for free at Blogger). You can write whatever you like, add photos, do whatever works for your particular subject. It can be a small part of your Life Sabbatical.

One thing should be topmost in your mind. Choose a subject, whatever it is, that really, really interests you! Too many people start blogs and then worry about choosing a topic that interests other people, not themselves. When they discover (as we all do) that it takes more time than they thought to attract readers, they drop their blog. They just aren’t interested in it. But if the topic is something important to them, something that really interests them, this can keep them going long enough to actually develop an audience.

And don’t get too focused on making money. If you have something to sell, fine, but there are also rewards that are every bit as important when you share with others, without asking them to pay for it.

Let me give you an example drawn from my own life in Panama.

Prior to and in my early months here, I read a lot of Panama websites. They were almost always commercial, at least covered with ads, and each had an “agenda” that clearly was meant to meet the needs of the site owner. Fair enough, but their need for money, in ads or sales, distorted their presentation in my mind. So I set up my own at RetirementWave.com. No ads. No books, tours, or “seminars”. No fees, commissions or any other revenue. If I found a home for sale, for example, that might interest my readers, I provided contact info for the owner, so no one had to go through me. There was no need as there were no fees or commissions involved.

Members of my website have asked me dozens and dozens of times over the years, why did you put up the website? I say, as a public service. They hesitate, then say, but how do you make any money? I say, I don’t. Another hesitation and they say, but why do you do it? And I say, as a public service.

It drives some of them crazy. I must be making money somehow. But they know I have never asked for money from them, so a few end up believing (and occasionally are bold enough to say so) that I am one or more of four things: 1) a liar; 2) crazy; 3) a fool, or 4) some kind of saint. All four are wrong (at least, I don’t think I’m crazy or a fool, and I know I am not a liar and certainly not a saint!).

But have I profited from Retirement Wave? Absolutely. I would go to look at land or homes that I thought might interest my members, something I rarely have the time to do these days, but did back then. A member came to me and asked me if I would be willing to look at some land at Lake Bayano, east of Panama City, as the owner wanted to sell. I had never heard of Lake Bayano and was very surprised to find that it was less than an hour and a half by car from the city. So I said, okay, I’ll take a look.

I fell in love with the area immediately. No doubt, this was worthy of mention at the site, but it troubled me. I wanted it for myself! I couldn’t afford what the owner wanted, so I went on my way and said nothing. Finally, a couple days later, I called him and said, I will buy it if you will accept my offer and be patient while I put the money together. He said, sure, and I am now the proud owner of that land! If you really care, you can see it at Flickr.

I had never expected this to happen and it certainly was not the reason for the website, but there it was and I was fortunate enough to have the opportunity simply because I had the website. No website, no land. Heck, I probably still wouldn’t know that Lake Bayano existed! So did I profit? Sure.

Like the young geology student, I found that to give really can mean some day to receive as well. But the giving comes first.
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One of the things that makes commentary here so difficult for me some days is the global context. I am watching the old 20th century world crumble around us (or on top of us) as we wake up to the reality of the 21st century. Some of us wake up to it slowly, but many are rudely shocked out of their daydreams.

Americans and a number of other nationalities have had to deal with a collapse in their real estate markets and, along with that, a global financial crisis. That is bad enough in itself, but now we sit and watch Europe as it goes through its own crisis that has very negative global implications. The current crisis center is Greece, but this new financial crisis threatens the whole Euro zone and, just as with the American real estate bubble collapse, it also threatens all of us. If you are not really aware of what is going on, John Mauldin presents a straight-forward and non-hysterical overview in his latest newsletter, republished at BusinessInsider.com. And this is just one more of a long list of current and potential crises that fill our news sites.

I have been following the political, social, and economic news for decades. It has been critical to my analysis and my personal choice of careers and general direction in life, as well as essential to my professional career. For a very long time, I had to depend on a variety of both general and specialized magazines, newspapers, and newsletters for my information. A friend once commented on the huge pile of magazines I always had in my living room and anywhere else I could find space. I sat down then and wrote up a list of all the magazine subscriptions I had at the time and they totaled 26. And that didn’t take newspapers and newsletters into account.

The advent of the Internet greatly reduced the pile of paper in my house! Now, I could follow even more publications than before. And it was certainly a lot cheaper and offered a much wider variety of resources. It also provided me with more opportunities to offer my own perspective and led to my first major publications in 1999, my first Barron’s article and a paper requested by the London Stock Exchange for an Internet-based investor’s conference. On or off the Internet, I have continued this intensive study for more than four decades now and it is as normal for me as coffee in the morning.

Long ago, I discovered that if my analysis was to be of any real use, I had to put emotion aside while doing it. Emotion may have its place in my reactions to the results of an analysis, but cannot have any place in the analysis itself. That is easier said than done, but it is a necessity if I am to avoid distorting my analysis. I have learned through decades of painful experience both how difficult it is and how necessary it is.

But it is much harder today than ever before. For the very first time in my life, I find myself depressed with an activity that is so utterly normal for me. The wave after wave of negative news and negative attitudes sometimes seems as if it will drown me. It is not just the news. Keep in mind that this blog and my Retirement Wave and Middle Age websites provide me with plenty of emails from individuals facing serious challenges in their lives as a result of all this negative news.

I am toughened to this from past experience (the decade of the 70’s was no “cake walk”) and usually can handle negative news and attitudes without much difficulty. If I am feeling challenged by it all now, I can only imagine how difficult it must be for someone who has not had the opportunities I have had. That is why I can say with all honesty how impressed I am with the many people I meet who have never had to deal on a daily basis for years with such a wave of negative news, much less been expected to analyze it for publication, but who are bearing up and dealing with it as well as they are. As far as I am concerned, their reaction is far more impressive than mine.

So what to do in times like this? After all that talk above, here are a few simple rules that I recommend you consider, if you haven’t already.

 The past is past, over, done with, through, finished. It is not coming back. Look forward to something new, not backward to something old. As Robertson Davies, a Canadian novelist, wrote in 1960, “The world is full of people whose notion of a satisfactory future is, in fact, a return to the idealised past.” There is no such return. Don’t make that mistake.

 The world is without clear direction or leadership at this point. Yes, there are many leaders, but no real global leadership. You have to be your own leader.

 You can hope, as I do, but there is no reason to expect that things will get better in this regard any time soon. So accept that and be delightfully surprised if it turns out to be untrue.

 If you have a future plan developed in the past that seems to be further from reality every month, put it aside and start all over again from the beginning. Start from where you are today, not from where you were five or ten years ago. Is it painful to give up all that time and effort you put in for years? You bet it is. It is just as painful for me, but we are all left with a decision. Take the pain now or take it later, and pain put off is usually far greater than pain felt today. I do not like it one bit, but I know have to do it and I am doing it, right along with you.

 I have said it before and I will say it again, do not think of it as failure, think of it as liberation from failure. To continue on a path that is easy because it is familiar, but is less and less realistic, is not seeking success, it is settling for failure. You can come back to it at a later date if it once again makes sense, but while it doesn’t, let it go.

 Don’t get too focused on money alone, important though it is. Too many people think money alone provides “strength”. It can, but not necessarily when circumstances are as unsettled and disturbing as they are now. Your greatest strengths lie within you, not your wallet or your brokerage account. And best of all, no one can take them away from you, as they can your money.

With that last comment in mind, let me leave you with the words of another man. I do not care what your feelings are on the subject of human evolution. Whatever they are, you are welcome to them. But Charles Darwin left us with words that are very useful in times like this. I read these words at least once a week, sometimes more often, and I have done so for many years. They help me keep my mind on what is really important, so let me share them with you.

“It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is the most adaptable to change.”

I do not want this blog to turn into a blog on the global context, but I cannot ignore it either as I know that this context weighs heavily on us as individuals, whether we like it or not. This is something I just felt I had to say. That is a core value to blogging. But next time, I really do plan to focus on something small and outside the general context, but more specific and hopefully useful too.
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“Martin Amis and Christopher Buckley are writers who are entering their silver years and are worried about the costs of an ageing population. Mr Amis, who has a new novel out, recently compared the growing army of the elderly to ‘an invasion of terrible immigrants, stinking out the restaurants and cafés and shops’. Mr Buckley devoted a novel, ‘Boomsday’, to the impending war of the generations. They have both touted the benefits of mass euthanasia, though Mr Amis favours giving volunteers ‘a martini and a medal’ whereas Mr Buckley supports more sophisticated incentives such as tax breaks.

“Novelists will have their jokes. But Messrs Amis and Buckley are right to warn about the threat of the ’silver tsunami’. Most people understand about the ageing of society in the abstract. But few have grasped either the size of the tsunami or the extent of its consequences. This is particularly true of the corporate world.”

I consider the collapse of the Retirement Bubble to be pretty obvious and all but unavoidable at this stage. This has many consequences for our societies, far beyond social security and medical payments for older people. One of the consequences will be the need for business to reconsider its attitude toward older workers. The words above are taken from the opening lines of an article at Britain’s Economist. It discusses how businesses are finally coming to grips with demographic reality and what they are thinking of doing.

I have been patiently waiting for this. With a declining “working age” population (as traditionally defined), the US and many other nations will have problems finding enough workers to keep their national economies functioning, competitive, and growing. Now that they are slowly realizing this, they are experimenting with various approaches, some of them mentioned at the Economist.

What does this mean to you? It emphasizes both the necessity to keep at least “one foot in” the work world and the potential benefits of doing so. As the implications for the future become clearer to businesses across the North Atlantic, efforts such as those described at the Economist will increase in number and in sophistication. But older people looking for jobs are not going to be hired indiscriminately. Those who get the good jobs, certainly those who get the best-paid jobs, are going to be those who have something other than years of “nothing” at the top of their resumes.

For those considering traditional retirement, the Life Sabbatical approach can help you get you where you need to be. For those already retired, now is the best time to start replacing “nothing” with something on that resume and the Life Sabbatical approach can help you too.

When a trend begins that will have great impact in the future, it begins as this one is beginning, with an article here and an article there. Over the last couple decades, these trends have tended to be negative, often very negative. Here is a positive trend that can benefit you one day when you need it.

If you can see the logic behind the Retirement Bubble, you should have no trouble seeing the logic behind this trend. As the collapse of the Retirement Bubble becomes ever more obvious, so will this trend.

But in the real world of work, you have a responsibility too. Nothing will be handed out to anyone just because they are old. You will be able to take great advantage of this trend in the future, but only if you prepare for it now.
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Once again, recent reports cause me to focus on the financial and economic environment we live in today. Three disturbing situations and no clear way out. We can begin with the US side of “the Pond”.

Allan Sloan, a senior editor at Fortune magazine, tells us, “Don’t look now. But even as the bank bailout is winding down, another huge bailout is starting, this time for the Social Security system. A report from the Congressional Budget Office shows that for the first time in 25 years, Social Security is taking in less in taxes than it is spending on benefits. Instead of helping to finance the rest of the government, as it has done for decades, our nation’s biggest social program needs help from the Treasury to keep benefit checks from bouncing — in other words, a taxpayer bailout.” The full article shares the statistics on which he bases this report and they are supportive…of his argument, not us.

And another topic that gets some attention, but far less than it deserves, is the gross under-funding of pension plans in the US. Mike (Mish) Shedlock discusses one tiny piece of this unfolding disaster in (where else?) California, as the city of San Diego faces a collapse of its pension program. Now that is a really tiny piece of a very big picture, but it gives us a taste. And San Diego is not alone. There are plenty of states, cities, and corporations in trouble, as is the federal government’s pension plan for its employees.

Across the Pond, Europe is facing a real disaster, as many of you have probably heard. Charmingly referred to as the PIIGS (Portugal, Ireland, Italy, Greece, Spain), we find their economies unraveling and threatening to take the Euro with them. Cute though “PIIGS” may be, it is also misleading, as Peter Zeihan of Stratfor (Strategic Forecasting) explains in simple terms in this video.

A major league financial crisis In Europe has consequences for all of us and we do not want to go there, but by this time next week or next month, we may be there. I do not see an easy way out for Europe, any more than I do for the US and, I fear, it will be worse in Europe.

Folks, the old 20th century system is broken. We have created a giant mountain of debt that is now crumbling, with occasional landslides that drive the point home. The mountain is still huge and growing in some areas. But the crumbling and the landslides are continuing and are likely to continue for a long period, measured in years, not months. That is the grim reality. Unfortunately, we have no really dynamic leadership, anywhere in the world, willing to level with the people and face up to this honestly. In the past, major crises have seen the rise of leaders who, whether they were loved or hated, provided the leadership that people needed when all was confusion and fear (Roosevelt, Churchill, and others come to mind). I do not see that leader today. I single out no one person to criticize, the problem is global.

When I wrote Next, the Retirement bubble last June (seems like a couple years ago), the situation was grave, but it just keeps getting worse. And as far as I can see, there is plenty of pain left to come.

But the single most important thing to know is that this is one horrible time for a traditional retirement! For all the reasons I have already discussed here (earlier retirements, much longer retirements, insufficient savings, etc.), this would be true under the best of economic circumstances for many people. Under our current economic circumstances, it is nothing less than a disaster for everyone. Yes, everyone. We are so inter-linked these days that there is no cave deep enough in the mountain for any of us to hide. If that sounds extreme, let’s talk in a year or two.

I could easily say that it is scary to watch this mountain of debt crumble underneath so many people, but that would be misleading. You see, we are all living on that mountain. None of us will go unhurt, but those who refuse to accept the reality that surrounds them are in danger of being buried beyond rescue.
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When I see something new and different on the topic of retirement elsewhere, I like to comment on it while it is still fresh. Thus I will step back from the direction mentioned in the last post to talk about another approach to the Retirement Bubble. This is a column titled, “The Geezers’ Crusade”, written by an op-ed columnist at the New York Times, David Brooks.

Ignoring for the moment the use of “geezer”, what especially grabbed my attention was Mr. Brooks’ blunt comments on those of us in the “50+” category:

Far from serving the young, the old are now taking from them. First, they are taking money. According to Julia Isaacs of the Brookings Institution, the federal government now spends $7 on the elderly for each $1 it spends on children.

In the private sphere, in other words, seniors provide wonderful gifts to their grandchildren, loving attention that will linger in young minds, providing support for decades to come. In the public sphere, they take it away.

He finishes by calling for a “spontaneous social movement”, mentioning both the movement that brought Barack Obama into the White house and the more recent Tea Party movement.

Spontaneous social movements can make the unthinkable thinkable, and they can do it quickly. It now seems clear that the only way the U.S. is going to avoid an economic crisis is if the oldsters take it upon themselves to arise and force change. The young lack the political power. Only the old can lead a generativity revolution — millions of people demanding changes in health care spending and the retirement age to make life better for their grandchildren.

The elderly. They are our future.

You can read his entire column at the New York Times.

THe first section above expresses some simple ideas in the sort of blunt language I used in my article at Barron’s, Next, the Retirement Bubble. It is rare to see this type of frank approach and I appreciate it. Some folks go so far in trying to be “polite” that they just do not get their point across. David Brooks gets his point across and I thank him for that. We need to hear it.

I am of the belief that if you are going to point out a problem, you should have something in the way of a solution to offer as well. In my case, the sharply negative language at the beginning of my Barron’s article led to my recommendation for a Life Sabbatical as a positive response.

Mr. Brooks has his positive proposal as well, but I must politely suggest that it is unlikely to be of much help. He calls on us to initiate a “nonselfish” social movement to demand that more money be spent on the youngest generations rather than on us. Sounds good, but not likely to occur.

First off, don’t imply that we are “selfish” and uncaring for the fate of younger generations. We are simply trying to deal with our own situation, resulting from an out-dated approach to retirement not because of any selfishness, but simply because that is the route our parents and grandparents took. We have been doing or planning to do what we were taught we were “supposed” to do when we were the younger generation. Give us a chance to come to grips with the radical changes facing all of us, not just us “geezers”.

Second, please keep in mind that simply calling for more money to be spent in support of the young does not do anything to remove the burden you now suggest we are. It only ignores it and, quite frankly, where the heck do you expect to find the money to support the goals of our “nonselfish social movement”, as well as help us deal with our needs?

Third, there are very few “nonselfish” social movements and the successful ones usually have a leader. Most have a clear benefit to those in the movement. Mahatma Ghandi’s movement in India was “selfish” in that its success was meant to directly benefit the members of the movement. I do know of one social movement in the US that I would call “nonselfish” and that was the Civil Rights movement which was powered in great part by white people on behalf of brown and black people who were to directly benefit. But such a movement requires a truly inspiring leader who can galvanize our support and the attention of the media. That leader was the Rev. Martin Luther King. Without leadership of that quality, we will not be able to rise above our own needs to focus on those of others “nonselfishly” (sorry for all the quotation marks, but “nonselfish” is not a word in my dictionary, I would have used unselfish and been done with it). I see no Rev. King of the geezers on the horizon.

Fourth, the approach we need to take is one that deals with the burdens felt by all generations, not just shifting attention from one generation to another. How can we who are older help the younger generations and ourselves at the same time? That is the question.

The solution is not to spend more money on the younger generations while spending more money on the older generations. I believe the solution lies in the older generation doing a better (and happier) job of earning its own income and meeting as much of its own needs as possible to free up resources to help those coming up behind us. That is the core of the Life Sabbatical approach.

I figure the probability of David Brooks reading this blog post are about one in 10,000, probably less, but if he were to do so and we were to discuss it, I would emphasize my appreciation for his having faced the problem straight-forwardly. It’s the solution that needs work.
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