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Deadman’s A-Z Guide to Living: Fear

I mulled over a lot of options while thinking about what to write about for the letter ‘F’. Faith, friends, family, fun, freedom, forgiveness, fatherhood are all topics I want to expand on at some point during this process, but in the end I chose ‘Fear’ because overcoming one’s fears is probably the single most important thing one must do to live the fullest, most productive life possible.

In small, rational amounts, fears are generally fine things, and certainly serve their evolutionary purpose, alerting us to possible threats and dangers, and preventing us from attempting feats which could prematurely end our lives.

Alas, fears don’t often come in modest doses; they prefer to go big, to expand into paralytic phobias, wiggling their way deep into our psyches, crippling us from doing things that could dramatically enrich our lives.

It’s fear that will prevent you from asking your high-school crush to the prom.

It’s fear that will keep you from majoring in theater.

Fear will have you settle for the first job offer thrown your way. Keep you stuck in your hometown.

It is why you won’t buy that stock, start that business, kiss that girl, write that novel, visit that city, join that group, forgive that enemy, fight that battle, take that leap.

It’ll convince you to avoid a confrontation and refuse a challenge, to shirk commitments and shrink from changes.

Fear is the bitter-tasting wellspring for jealousy and hate and cynicism and regret.

In the end, fear will only leave you wondering what might have been.

Overcoming one’s fears, however, is no simple task; I certainly have few answers. This is strictly a ‘do as I say, not as I do’ piece.

I mean, I know how silly most of my fears are, how freeing it would be to rid myself of them, yet they still cast a very strong shadow in my life.

I may have outgrown or pushed aside out of necessity certain of my fears, but mostly I have failed thus far to do something which I know is of utmost importance.

It’s all quite sad, and I’m sure you’ll find more useful assistance within modern psychiatry or on the shelves of your local bookstore’s self-help section. Or perhaps conquering one’s fears merely requires accessing a reservoir of inner fortitude I don’t have or haven’t yet been able to reach. I only hope you will be more successful.

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Now for your amusement and education, I’ll quickly rundown a small sampling some of my more prominent fears – rating them on their intensity, rationality and impactivity (not a word I don’t think but should be) – and hopefully you’ll be able to see how destructive fears can be. Remember, this is merely a small taste of my fears, plenty more where these came from.

FEAR OF SNAKES, SPIDERS and OTHER CREEPY CRAWLY THINGS

Intensity – Low. So ever since I can remember, I’ve always hated bugs. Could never watch nature shows about creepy things, certainly couldn’t stomach it when such creatures dared enter my childhood home, dismantling its aura of safety and security in one fell crawl. If I would see in my room a spider (they were the most prevalent threat in suburban St. Louis living), my plan was always the same: Immediately flee the scene in search of my mother or father to have them get rid of the offending creature. If neither parent were home, I would not return to the scene of the crime for many hours, at which point I would just pray that the bug had the decency to crawl to my brother’s adjoining room.

Thankfully, over time, this particular fear has dissipated. Granted, I still get the chills and make that crinkled-up face when I encounter a bug. And I still strongly believe that civilized man and creepy crawly things should keep to their own natural habitats (thus my aversion to almost all outdoorsy activities, most notably camping).

But I now have a wife of my own, who is at least as averse to creepy, crawly things as I am, and removal of such creatures now justifiably falls to me, the supposed man of the house. I generally succeed in the task, with only minimal shrieking.

Rationality – Medium. True, those creepy, crawly creatures generally mean no harm, and most couldn’t do harm even if they had the desire, but a small number can be poisonous and/or spread disease. And let’s face it, all of them are rather unhygienic.

Impact – Low. Even at the height of this fear, it was never particularly paralyzing. It did perhaps prevent me from pursuing my dreams of becoming an exterminator.

FEAR OF FLYING

Intensity – Medium. I am still not convinced man should ever leave terra firma. I’m not a fan of the ocean, spooked out by its sheer vastness and by all the unknown, unseen things living in the blackness below (the fact I am not a strong swimmer doesn’t help), but my fear of the water pales in comparison to my fear of flying.

This fear has actually intensified over the years – I never enjoyed flying, but now I dread the days I must travel the friendly skies. For me, the worst part is takeoff, as the process of fighting gravity and achieving flight just seems totally unnatural and full of hubris to me, like it’s doomed to fail because we’re somehow disturbing nature’s laws or god’s will.

I think I’ve just seen one too many disaster flicks, but I just cannot fathom a more dreadful way of dying: Being trapped for several minutes in a plummeting, shaking vessel with nothing but the sound of screams and chaos to keep you company as you wait for the inevitable crash and the horror that will surely follow. (Well, perhaps drowning would be worse, but with some flights you have the chance of a water crash landing, making it a 2-for-1 special in worst ways to die).

Rationality – Medium. Now I know the stats that say flying is by far the safest mode of transportation, but I still believe the absolute horrific nature of what goes down in a plane crash justifies my fears on some level.

Impact – Low. So far, I’ve been able to just bear down and deal with the white knuckles. I’ve pretty much gone everywhere I’ve needed to go, including a couple of long trips to Europe and China. But with a new daughter, I sure do wish at least one set of grandparents lived within train distance!

FEAR OF DYING

Intensity – High. I’m pretty sure I was like most kids, completely unconcerned with my mortality. But ever since my maternal grandfather got sick some 20+ years ago, I began to be consumed by thoughts of death. Despite the fact that my paternal grandfather was the only close relative who died relatively early (mid-5os), I was convinced that I was going to die young. I think what I fear the most is the process – I don’t know what it’s going to feel like to die, but I assume there is going to be a lot of pain and suffering involved (I imagine it being like the worst flu you’ve ever had and you just don’t get better – though obviously a sudden death would be much different). I saw both my grandmothers die and it was an awful process, one that I think as a modern, evolved society we could handle a lot better. Many nights I keep myself up with thoughts of death and dying, often with me as the main subject. Unpleasant stuff, to say the least.

Rationality – Medium. You would think that this would be one of the more rational fears to have. Everyone does, in fact, die at some point. It’s likely to be quite painful. You don’t know the where or when, so there’s a disconcerting lack of control over the matter. And unless you’re a person of deep faith (in religion or science), what happens afterward is more than a little frightening to ponder. But actually, and partly because of all these reasons, death is a highly irrational thing to be afraid of – and certainly not worth wasting the precious minutes of living worrying about death often involves. It’s going to happen – you don’t know when or how but it’s likely going to suck – and you won’t know what comes next until it does, so why not appreciate your life and good health while you have them.

Impact – Medium.  Here’s the crazy thing – while the pain of death is certainly a major reason for my fear of it, at least a part of what I fear is that I will die with unfinished business and view my life as a waste of time and energy. But it’s my fear of dying, along with all of my other fears, that often prevents me from fully living. How utterly asinine.

The solution isn’t to ignore our mortality, either, which is what I find myself – and a lot of other people – doing, maybe as a kind of survival tactic (I know it’s somewhat contradictory for a person who fears death as much as I do, but even today, when I read about someone near my age who dies – an alarmingly more frequent occurrence – I feel oddly detached from the news, as if death was this surreal concept that won’t ever affect me or those closest to me). Instead, I need to respect death, come to grips with its finality, its inevitability, and its ultimate meaning, and use that understanding to better take advantage of the finite, glorious blessing that is life. Respice finem.

FEAR OF REJECTION/FEAR OF FAILURE

Intensity – High. These are actually two different fears but they’re closely related enough (and this blog is way too long already) that I’m lumping them together. Being rejected means being dismissed out of hand, without even being given the shot to prove yourself – think of the woman at the bar looking for the escape route, or the potential employer tossing the cover letter in the trash. Failing is even worse; It means you are given a chance but fall short of people’s expectations. Think of the woman several months later dumping you, or the boss firing you. In the former case, you fear people think you’re a fraud. In the latter, you know people think you’re a fraud. And in my life, both fears are omnipresent, and hugely paralyzing.

Rationality – Low. The worst part is these fears make little sense. First of all, only the rejected can give rejection its power. Who cares what other people think of us, our looks, our personality, our talents? You will never please everyone so you shouldn’t take rejection personally. Dismiss it. Scoff at it. Reject rejection. And as far as failure is concerned, it’s virtually a prerequisite for success. I defy you to find a successful person who hasn’t been waylaid by a significant failure at one point in their lives. The only trick is not letting failure stop you, which is, of course, a trick much easier said than done.

Impact – High. No fears have done more damage to me than these two. And while I won’t ever know the full extent of the opportunities that I may have lost because I was too afraid of rejection and/or failure, I do strongly believe I never reached my full potential because of these fears. In the words of the Rev. Sydney Smith: “A great deal of talent is lost to the world for the want of a little courage.”

Deadman’s A-Z Guide to Living: Charity

I basically do everything ass-backwards when it comes to charity.

They say you should give generously. I don’t give nearly enough. I’m not religious, but there is a laudable Judeo-Christian tradition of tithing, which means giving up 10 percent of one’s income to charity (Well, the original intent of the tithe meant giving 10% of one’s income/production to God via the temple – and still means that for many Christians – but has now evolved to encompass charitable giving more broadly). I have no clue if the tithing is meant to be before or after taxes (I’m thinking post-tax), though I often fall well short of that 10 percent goal in either scenario. Heck, many years, I probably don’t tithe my tithing obligations (1 percent, for those not good at math).

They say you should give eagerly. With joy, even. I almost always give reluctantly, feeling a lot like Oda Mae Brown in Ghost when she is forced to give up that million-dollar check to the nuns on the street. I also get more than a little annoyed when people call my house to ask for donations. I try to be polite and respectful as I know these people are just doing their jobs (or even volunteering) and following their scripts, but I find the intrusion terribly annoying. It’s particularly galling the way they keep badgering you when you tell them ‘No, thanks,’ and they just keep moving their requested donation down in increments, to the point where you feel like the cheapest schmuck in the world when you tell them, ‘No I cannot give you $5. Now, please leave me alone.’

The truth is, though, these telemarketing calls are usually quite successful – I am a sucker who has trouble saying no, and usually wear down and give up something just so I can get off the phone. But this surrendering makes me even madder because I feel like I’ve been beaten at a game somehow, and I just know these yeses will only lead to more calls in the future. Which it does – barely a week goes by where I don’t get somebody calling me up asking for money. I now try to avoid answering any number which isn’t recognizable on caller ID, as these bastards always know to block or disguise their names, but once these guys have your number, they will NEVER stop calling until you pick up the phone.

They say you should give anonymously. This makes a ton of sense, as publicizing one’s charitable contributions is more than a bit gauche and tawdry. If the sole purpose of charity is to help others and do good in the world, then you should have little need of attaching your name to donations. But me, I always want to make sure people know when I have given and if at all possible (and impressive a figure), how much. When friends or family ask me to give to a cause, I have never once checked the ‘Donate Anonymously’ box that often accompanies the online forms. And when there is a donation number that will get my name in some sort of stupid brochure, I try and make sure to hit it.

Giving anonymously also prevents the recipient from feeling indebted or humiliated upon receiving aid. A noble idea, and yet one of my favorite ways of giving charity is giving dollars (or worse, pocket change) directly to panhandlers on the street. Why? Because it gives me an immediate sense of satisfaction, hearing their ‘God Bless Yous’ and seeing their genuine looks of appreciation. But do I stop and think about what little good those dollar bills or quarters are actually going to do and how low and beaten down these people must feel that they’ve been forced to beg for my meager assistance in the first place. Yeah, perhaps they are just happy to have the money to find their next meal (or their next score – I make no judgments about how a homeless person finds whatever small happiness he can get in his life), but surely they must also at times feel a tremendous loss of dignity at what they are being forced to do, and the fact that I am getting self-satisfaction out of the small gesture basically negates any of its inherent goodness.

They say you should give more than money. Money definitely helps, but donating one’s time and effort often provides a much more meaningful impact. I fail miserably here as well. One time about a decade ago, I sponsored an inner-city student to help him attend a well-run Catholic school. My brother provided the majority of the financial assistance while it was my main job to help guide him and his family through the process, and make sure the kid was adjusting and succeeding in the new environment. But I was a single guy living it up in Manhattan, and here too, I gave the minimum amount necessary. I made little effort to help him improve his faltering grades, or to give him advice on how to get into college, or to make any kind of lasting impact that could have affected his life beyond his graduating high school. It was yet another example of good intentions gone bad, and I have regrettably lost touch with the student and his family. I also have rarely volunteered my free time for charity since then.

Yet, despite my numerous shortcomings in charitable giving – my poor track record, my questionable motives, my begrudging attitude – I just don’t feel you can do charity wrong. You can do it in better or worse ways, and I resolve hereby to try and keep improving my technique with each passing year – to give bigger and smarter and eagerer.

On the other hand, I am not embarrassed to acknowledge that giving charity also makes me feel good.  The desire to give of oneself to help others is one of the things that separates and elevates us as a species. Whether it’s done because the Bible says doing it will get us into heaven or because natural selection has made empathy a defining human trait, charity is a key ingredient of a successful and well-lived life.

MOFT: Episode 14 (The soon-to-be Mrs. Deadman)

Sorry for my extended absence the last couple of weeks, but the excuse is a good one: I’m engaged!!

So as much as I may have wanted to make the clementine My One Favorite Thing of the Week – I mean, really, it’s got all the health-filled, sunshine-y goodness of the orange but with more sweetness, less seeds and in an adorable little easy-to-peel package to boot – it’s only fitting that I bestow that honor instead on the amazing girl who finally convinced me to give up 35 glorious years of singlehood.

The soon-to-be Mrs. Deadman is sweet, smart, sensitive, silly and sexy (yes, she too comes in an adorable little easy-to-peel package). Even though we’ve been together for just under 2 years, it is tough to imagine my life without her. She has a very caring soul, is incredibly nurturing (you should see her coddle our dog – and to think she wasn’t a dog person when I first met her) and totally trustworthy. Her smile and laugh are infectious. She keeps me entertained and challenged. She supports me in every way imaginable. She gets along beautifully with my family and friends (and as a big bonus, I love her family and friends, too). I really could go on and on about how great my fiancee is (we both hate that word and have stolen her sister’s use of the word beyonce instead), but suffice to say, she is a catch.

Now that I’ve made all the readers sick with my saccharine description, I will begrudgingly admit we’re not perfect. We have our scraps. But that’s OK. We know we love and care about each other a great deal and we start with that premise whenever one of those thankfully rare disagreements arise.

At some point, I will probably discuss my qualms over the institution of marriage in general and how I got past them. But for now I just want to keep this (mostly) romantic!

The bottom line is that I’ve found someone who makes me laugh, who makes me think, who makes me horny, who makes me dinner (on the rare occasion!), who makes me happy … who just makes me better.

And I feel like a very lucky man.

Let’s Get (A Real) Physical …

Earlier this week, I went to my doctor to get a physical.

What a joke.

Nurse came in, took some blood and, because I have a heart condition, administered an electrocardiogram (EKG). After a few minutes, doctor entered, looked in my ears and mouth, listened to me breathe for a bit, asked me a few questions about my general health and the back/leg pain I was experiencing last time I saw her, and then sent me on my way to deposit some urine and check out. All in all, it took less than 25 minutes from the time I entered the doctor’s office to the time I paid my rather exorbitant $35 co-pay, and that’s including the waiting time.

Sometime early next week, I will get the results back from my blood and urine tests, and the numbers will all likely come back within the ‘normal’ ranges, suggesting I am the rather healthy 35-year-old male I appear to be.

But the question will remain, am I really healthy??

I firmly believe we will one day soon regard the current diagnostic procedures and preventative methods of our health system as incredibly rudimentary and insufficient. I mean, people tend to get their cars checked out with much greater detail and frequency than they do their own bodies. Airlines inspect their airplanes after every flight, and the most we do is get a doctor to take a quick look-see at us every so often (and maybe get the occasional mammogram or colonoscopy when we get a lot older)?

It makes no sense. The no. 1 killer in the world is cardiovascular disease, and cancer is expected to overtake the top spot by 2010, according to the World Health Organization. In both diseases, early diagnosis is an extremely important factor in determining whether treatment is successful, and yet symptoms often don’t appear until it is too late. How many people have you known or heard about who seemed perfectly healthy, only to find out later they suffered a heart attack or developed late-stage cancer?

We spend billions and billions of dollars every year on cures and medicines for all sorts of diseases, many of which end up being ineffective … when an earlier diagnosis would often result in much simpler, cheaper and more effective treatment options.

If only we could develop a safe way to comprehensively examine our internal systems on a regular basis, to see if tumors are spreading, arteries are clogging, etc.

Oh but wait! We pretty much have done just that…

Magnetic Resonance Imaging machines, or MRIs, actually do take detailed, accurate pictures of a person’s entire insides. Unlike X-Rays or CT scans, which use radiation to complete a similar function, MRIs are generally considered safe (if a bit difficult to endure for anyone who’s even slightly claustrophobic). Yet despite the MRI’s impressive capabilities, they are still only used after symptoms present themselves and even then with some reluctance because of their high cost.

Around a decade ago, private clinics started popping up all over this country, offering full-body scans using either CT or MRI technologies. Given Americans’ obsession with fighting aging and staying fit, you’d think these clinics would have done quite well. Yet they started going out of business almost immediately, thanks in large part to the high cost of the machines (several million dollars) and the uninsurable exams ($600 to $3000), as well as some extensive negative lobbying by traditional health care providers, including an HMO industry that was likely very worried they would one day be asked to reimburse patients for these tests.

The full-body scans were unnecessary and dangerous, most health-care experts argued, saying that in addition to the radiation of the CT scans, the tests can’t accurately diagnose all diseases, resulting in a lot of false negatives as well as false positives.

False negatives can certainly lead to unhelpful patient complacency, but since cost is what drives almost every medical decision nowadays, I’m guessing it is the false positives and all the subsequent expensive and invasive follow-up tests that most disturb the insurance companies.

But meanwhile, the technology in an MRI machine has since gotten a good deal more powerful and effective. Could it be that the early diagnosis of treatable diseases would end up saving the health industry money in the long run?? Has anyone done a detailed study on that cost/benefit equation?? And what, exactly, is the ‘cost’ of a life, anyway? Shouldn’t that matter??

A German university did a study a few years back where they gave full-body MRIs to 298 ‘healthy’ patients and found something ‘relevant’ in 169 cases, 75% of which were confirmed by follow-up exams. Among the problems discovered included twelve colonic polyps, nine pulmonary lesions, and two previously undiscovered heart attacks. Twenty-one percent of the patients demonstrated atherosclerotic disease, while 12 percent had peripheral vascular disease.

Only one false positive was found in the study. And yet the researchers still concluded that full-body MRI scans ‘should not be performed outside of a research setting due to the uncertainty of whether the benefits outweigh the risks.’

Like I said, what a joke.

ENOUGH!!! …

I’ve had it.

This country has been on engorging on a cheap credit binge for the last decade, stuffing itself on the sugar highs and empty calories provided by ultra-low interest rates and fancy derivatives and zero-down mortgages. Now the chickens are coming home to roost, and everyone is looking for a way to get their butt saved.

It’s bad enough that Congress already spent $150 billion earlier this year on a fiscal stimulus plan that did nothing but allow us to buy IPhones and XBoxes for a few more months. The American people now want more, and it looks like Congress is going to give it to us with another huge stimulus package. It’s money we can’t afford right now and which won’t do anything but provide another very temporary boost to an economy and consumer that needs to retrench for an extended period of time before they can begin to reflate.

But spending money one doesn’t have is the American way. Just ask the country’s beleaguered homeowners now drowning under onerous interest payments, the folks who were too busy picking out Ikea furniture to read the fine print of those adjustable-rate, no-doc mortgages they were signing.  They, too, are soon going to get plenty of help from our friends in Washington.

You see, everyone says we need housing to rebound in order for the economy to recover, so by god, we are going to make the housing market rebound, even if it means the government has to buy up all those nasty little mortgages and restructure them, as Senator John McCain has so magnanimously offered to do (and to hell with the free market and the natural laws of supply and demand).

But really, who could possibly blame the American people for wanting to be spared the pain of an economic downturn?? They’re just following the lead of our most esteemed industry and financial leaders and watching with green eyes as the government tosses around hundreds and hundreds of billions of dollars like so much loose change.

How fitting that the first ones at the government trough were the Wall Street pigs who cooked up this unhealthy smorgasbord slop and fed it to the ravenous, greedy (but mostly unsuspecting) crowd of American consumers.

Oh, it may seem unseemly that the ones largely responsible for creating this mess would be the first to come begging for help, but The Powers That Be knew the financial system that Wall Street had so cleverly manufactured was so fragile that many of these banks couldn’t fail. They knew that the pyramid scheme would have to be unraveled slowly or the entire economy would shut down.

So in order to prevent exposing the rot in the system to the public, regulators forced Bear Stearns into the hands of the relatively well-capitalized JP Morgan Chase, guaranteed the losses with a $29 billion loan and then lowered interest rates in an emergency session.

But that was just the start. You know the rest of the story. The scope of the problems became obvious, and it was clear the cancer had metastasized to every corner of our financial system. Housing in particular was a disaster, so we nationalized Fannie Mae and Freddie Mac (which should never have been privatized in the first place, as one of the only things scarier than capitalism gone mad, is capitalism with implicit government backing gone mad ).

AIG, too, needed help since it had gotten caught insuring a lot of these failing institutions, so we rescued that firm with $85 billion (and then watched as some of that promised money was immediately spent on a lovely sales retreat, replete with a $23,000 spa bill).

And yet all that government assistance still wasn’t enough, so the Treasury and the Fed went to Congress and pleaded for another $700 billion, and only after getting that pork-laden package passed have they begun figuring out exactly how they are going to use that money to save our banking system and economy.

It is all just so very frightening, but the last straw for me was reading an article about some of those poor, poor folks in the hedge fund industry who are now hoping they’ll also see some of that bailout money. Treasury Secretary Paulson insists the money is just for banks and thrifts, but that ‘plans could change’.

You’ve got to be kidding me!!

I mean, for crying out loud, it was only a decade ago when the government and a bunch of banks bailed out a hedge fund company named (ironically enough) Long-Term Capital Management.

Long-Term Capital, with its use of insane leverage (at least 25x) in highly illiquid, poorly regulated financial instruments, including some of the very same derivatives and mortgage-backed securities that are now causing us grief, was in many ways Version 1. 0 of the current Wall Street mess. And yet we ultimately learned very few lessons from that clear early warning sign (This Working Group document has some great background on the LTCM debacle as well as a number of generally ignored conclusions and recommendations).

Frankly, we missed a golden opportunity to increase supervision and disclosure requirements to help rein in some of the industry’s excesses.

Even worse, the LTCM bailout (and the subsequent lowering of interest rates by then-Fed Chairman Easy Al Greenspan) helped fan the flames and foster the environment that we now find ourselves in by encouraging more ill-advised risk taking while institutionalizing the idea that the government will always be there to cover up for our mistakes.

But there is a price to be paid for that largess. Eventually, we’re going to have to pay for this misguided philosophy. I’m just worried that it’s too late, that we’ve dug ourselves into a hole so deep it will take a generation or more to climb out of.

So it’s time to stop the capital injections and bailout plans, the incessant pumping of liquidity into the markets and the careless printing of money, the debt issuance and the interest rate cuts. We’ve done enough to unfreeze the markets and prevent a systemic collapse. It’s time to let the brutally effective corrective mechanisms of capitalism take care of the rest.

As Obama said during the most stirring moment in his Denver keynote convention speech:

‘Enough!’

How The American Dream created this American nightmare …

You hear a lot of conservatives nowadays wanting to place blame for the country’s current economic crisis on the Community Reinvestment Act of 1977, which encouraged commercial banks to lend money to borrowers in low-income areas.

The implication is that the CRA, enacted and significantly expanded under two different Democratic administrations, led to the creation and proliferation of the risky subprime mortgages that have brought the U.S. banking system to the brink of collapse.

Never mind the fact that CRA-regulated commercial banks originated less than half the total subprime mortgages or that at least as much share of the blame for how things got out of hand has to be placed on the Republican-led repeal of the Glass-Steagall Act, which allowed investment banks and other less regulated institutions to engage in similarly risky lending (and to do so without the leverage restrictions placed on commercial banks).

But conservatives do have a point (even if it’s not the one they really intend to make): This country’s myopic focus on home ownership as the be-all and end-all of The American Dream did indeed help spawn the housing and credit bubble, and the CRA is just another in a long list of government policies that have encouraged home ownership as an important component of economic development and societal stability.

OK, maybe I’m just a bitter renter who’s trying to justify his lifestyle and puny net worth, but I do wonder … is home ownership really that important?

The National Association of Realtors certainly thinks so, and some of their rationale makes sense. For society as a whole, home ownership may in fact offer some advantages, as people who buy their homes are more likely to be invested in their communities and neighborhoods than renters. However, I would think these benefits have diminished over time as the nation has developed and become more settled.

Encouraging broad home ownership probably also acts as an alternative means of reducing income inequality in a capitalist economy, and at the same time instills in citizens the importance of private property rights, both of which lead to increased stability in our society. Given that our national savings rate is negative, home ownership also encourages people to invest and save funds they might otherwise not.

But that capital comes at a cost, an opportunity cost. Homes are static entities, non-productive investments. By themselves, homes don’t create anything of tangible value.

And homes are not particularly good investments, either. Robert Shiller did a hundred-year study and found that homes increased in value about 3% a year on average, not much more than the rate of inflation, with only a couple of temporary periods of dramatic outperformance.

Another study by two professors, Roger Ibbotson and Jack Clark Francis, found that housing increased in value about 8.6% a year from 1978 to 2004. Not bad, but not as good as commercial real estate at 9.5% and well behind stocks at 13.4%. (Granted, you can’t live in a stock).

The math gets a bit better when you account for the substitution costs of renting, but a lot worse when you include the other costs associated with home ownership – and there are plenty of them, such as mortgage interest, insurance, upkeep, refurbishing and property taxes. The WSJ estimated that a $300,000 house could end up costing an owner more than $1 million over 30 years. And that excludes the costs of buying and selling a home, which can add up to as much as 10% of the transaction value and make moving to a location that better suits one’s needs or skills a much more expensive prospect than it’d otherwise be.

A good trader friend of mine, who used to live in a rented NYC apartment, described his St. Louis home as a ‘money pit’ and usually wishes he was still renting.

Unlike with stocks, where diversification is possible and laudable, owning a home often requires a person putting almost of his or her eggs in one basket. And if you bought a home in the last couple of years, that’s a much smaller basket now.

Bottom line: Obviously, every locality is a bit different, but I think owning a home can make sense for people who plan on staying in the same place for about 5-10 years, or who enjoy the responsibilities of upkeep and maintenance (I, however, recoil at the prospect of lawn mowing and do-it-yourself repair projects).

But even in the best of scenarios, home ownership is rarely the best path to getting rich. And as we’ve found out in recent months, making it a key goal for a society – at the expense of other worthwhile goals and values – can lead to a rather unwise deployment of capital and some really nasty unintended consequences.

Some perspective on a Gray Monday …

So, the market is down 555 points, almost 5 percent. Yet so far this is no October Black Monday, like when the market dropped 13 percent on October 28th, 1929 or when it dropped 22% on October 19, 1987. (Note: Things are moving fast, market down more than another 100 points since I started writing).

This is, in many ways, even worse – just another Gray Monday, where we get the continued, orderly drip-drip-drip of a market with no confidence, and no idea of where we are headed.

Did you know in the Great Depression the market fell 89% from its 1929 peak? And that it took us three years to get there? I’m not saying that’s what is going to happen now. The world is very different. The genesis of this crisis is very different (whether that’s good or bad, who knows?). But it’s something to consider. I think we’re headed toward that panic sell-off … but we’re not there yet, and even if we have it, I don’t expect to get the immediate recovery we got in 1987.

Things will likely get worse before they get better. Good people will suffer. But to complain seems rather silly when so many people around the world have much bigger problems. As far as I know, I’m healthy. My family is healthy. i have so much love in my life. I know how I’m going to find my next meal. I live in a country where I can speak my mind, and vote my conscience.

Yes, even on Gray Mondays, life goes on.  I walked my dog in Central Park this afternoon and the sun was still shining. It was a beautiful early fall day, and I enjoyed every moment, watching my cocker spaniel search for any bits of food left by careless picnickers and chase squirrels he’ll never catch and wouldn’t know what to do with even if he did.

This election both presidential candidates have been tossing out words like Hope and Change as if they were cheap plastic political buttons, offering very few specifics about how we are going to get out of this mess. But Hope and Change are powerful concepts, and if applied correctly can help people get through tough times.

Today, I’d like to add one more:

Gratitude.


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