Not evenly distributed

The future is already here,
it’s just not evenly distributed.

Sci-fi writer William Gibson

This undated photo shows electric vehicles being plugged into what we today would refer to as charging stations. Early in the 20th century auto makers dabbled with electric vehicles. They repeatedly came back to the enterprise, most notably with the Saturn EV, profiled in “Who killed the Electric Car.” In every instance, the future was there for all to see. It just wasn’t evenly distributed.

Any time a good idea dies in its infancy, we can look to two reasons: technology and mindset. The batteries were laughably short-lived and the network of charging infrastructure to make long-distance travel possible was non-existent. And yet, as recently as a few years ago, the situation was no different. Battery technology (including but not limited to longevity, size, weight and cost) kept the major manufacturers from jumping into the EV space, and since ICE vehicles were still selling, with pickups and SUVs being the most lucrative categories, Ford and GM stayed where the money was.

Then Tesla. And Fisker. And Rivian. Lordstown. Lucid. Et cetera. The small outfits that tolerated the the lack of profitability in order to realize the dream of sustainable EV production themselves created the technology and mindset that led to sustainable EV production. (Let’s ignore momentarily that profitability is a key component of sustainability.

There were missteps along the way. In their investor presentations, the Nikola Corporation famously rolled a semi down a hill in order to simulate what it would look like if their long-haul EV tractor had worked. Then CEO Trevor Milton was swiftly mocked and relieved of his duties, and both Ford and GM withdrew their interest and investment capital. Notwithstanding the technology that already existed, if Tesla, Fisker and others had not sufficiently changed consumer and investor mindset, would Nikola’s gag have put EVs back on the shelf for another generation?

Electric vehicles are no longer the future. They are the present. The name of the game now is adoption rate. As we look to the future, what are the trends that reflect an unevenly distributed future? Hybrid workplace, augmented and virtual reality, Internet of Things, decentralized finance. These are just a few of the trends that have made headway in recent years, most of which gained momentum (or at least mindshare) during the 2020 lockdown. Which glimpse of the future will you seize on, invest in, adopt into your professional practice?

Sometimes the future stares us in the face and we don’t know what we’re looking at. These police officers didn’t know what they were looking at. They saw an affront to law and order. They were actually looking at the future 16-term congressman from the state of Georgia, John Lewis. Future on the right, the past on the left—unevenly distributed.

If I had had the opportunity to meet Rep. John Lewis before his passing, I would have thanked him for bringing the future to us a little sooner than the country expected. He paid dearly for it.

What social trends do we see going on around us? What is as it should be and what is in dire need of change? Is the thing you see that makes you uncomfortable or makes you angry wrong, or is it the first glimpse of a future you have an opportunity to be a part of?

If you spend more than five minutes in the room with a self-proclaimed “educational innovator,” they will point out that the classroom of 2021 looks very much the same as it did in 1921. It’s one of our favorite zingers.

COVID-19 forces the world to adopt remote learning, and we learned two things from it: 1) It sucks and 2) It holds promise.

More than anything, we learned that regardless of where we are in our technology and our mindset, learning is nothing if not a deeply social enterprise. We NEED to connect with the people we learn from and learn with. And yet, as any introvert can tell you, not EVERYTHING needs to be done in groups of three framed around a “do now” and an “exit ticket.”

So, as schools reopen in the fall, or as those that have been open loosen restrictions, what should endure from our flirtation with virtual school? What does the future look like, its full distribution we’ve only begun to glimpse?

An English teacher colleague of mine has recently rekindled his love of teaching writing. He is far from stagnant in his practice, but neither does he chase every pedagogical whim for the sake of being “the innovative teacher.” He swings at pitches that he know will drive in runs.

When our school went virtual in the spring of 2020, he was forced to conduct writing consultations with students via a screen-shared Zoom call. This intimate setting allowed deep conversation, thoughtful inquiry and self-assessment, and frank conversations about one’s writing. Suffice it to say, this practice will endure the reopening of schools.

A math colleague began the practice of “breakout rooms of one.” She put her students alone in a breakout room during moments of reflection and assigned them a conversation with themselves. They had to speak out loud and they had to participate in both sides of the conversation. Although it took practice, students responded positively to the exercise. In particular, they like holding the responsibility of both formulating the question and finding the answer, of providing both the point and the counterpoint to a problem.

Which brings us to now. Nearly out of the pandemic, we probably spend more time looking to a more normalized future than thinking about our constrained past. Which of those constraints are worth holding on to? What should live on in your teaching practice? In the life of your school? What’s worth distributing now?

Reality is out of reach

There’s a Chinese proverb in which several blind men are summoned to court to answer the question, “What is an elephant?” As each man grabs a hold of one part of the elephant, the men in turn make their estimations:

“An elephant is a round pot.”

“An elephant is a thick tube.”

“An elephant is a large leaf.”

After some time the men begin arguing with one another about the nature of an elephant. Each of them is right, but only partially right. They only have access to one perspective of what is a very objective reality.

We can all agree that there is a thing called objective reality. In so far as our coaching practice is concerned, we have to acknowledge that we only see the portion of reality that we’re privy to. And that lot only represents a portion of the portion that our coachee/client/colleague is privy to. It’s a portion of a portion of reality.

The only remedy for this condition is curiosity. To stay curious in our coaching response keeps questions flowing, keeps options open, keeps the blind man running his hands down the elephant hide, searching for more information about the true form of the thing under examination.

Making Poetry and Politics

Right around the end of each school year I piece together a reading list for the summer, then I go to my school and public libraries and start clearing the shelves. COVID forced me to amass a summer reading list out of the books on my shelf at home. As a result, I managed to read several books that I have owned for months or decades. Some were better left on the shelf, but some have been a delight.

Even though schools and libraries are now open, I’m continuing the trend and recently picked up “The Buried Mirror” by Carlos Fuentes. Part history book, part Latin American polemic, I first read the book in its native Spanish (“El espejo enterrado”) in 1998. Some time later I bought the English version, put it on a shelf, and never looked at it again. Until now.

Fuentes opens the book with reflections on the relationship between Spain and the New World. Above all else, he characterizes the relationship as “a debate with ourselves.” In the process he evokes a W.B. Yeats quote:

And if out of our arguments with others we make politics, advised W.B. Yeats, out of our arguments with ourselves we make poetry.

Fuentes, p. 15

The original Yeats quotes is as follows:

We make out of the quarrel with others, rhetoric, but of the quarrel with ourselves, poetry.

Let’s not let slip the opportunity to quarrel with ourselves. Let’s, in every occasion possible, make poetry.

Election

My favorite tweet from the last few days:

We’ve turned the page on “Tuesday, Part 5,” and Joe Biden was officially projected to be the 46th President of the United States on Saturday, November 7. All the news networks showed footage of Biden/Harris supporters spilling into the streets. Jubilation and affirmation from the side that won, silence and disbelief from the side that lost. It has always been thus.

One thing that is distinctly different in the current scenario is how the Market reacted. In the days leading up to the election you can expect fits and starts. We mostly got starts with several +1% days for the S&P and or NASDAQ. Once Election Day came and went without a clear winner, we could have all expected the Market’s reaction: selling.

The Market abhors uncertainty. The Market more often than not reacts to an unwelcome situation more favorably than an uncertain one. So, the fact that the Market remained positive during the week of the post-election ballot counting is truly incredible. It happens that Election Day overlapped with 3rd quarter earnings season, so in a fit of uncharacteristic rationality, the Market actually did what it is supposed to do–move in relation to market-specific inputs rather than exogenous events such as elections or Twitter feuds.

Faith, Time and Homework

My motivation for investing is to provide financial independence for my family. My passion for investing comes from watching two important people in my life, my mom and my dad, spend their lives investing in very different things.

My parents married in the early 60’s and had their first child in 1968. They undertook what economists call “household formation” at the tail end of a boom that began in 1945 and began to fall apart in 1973. Throughout their childhood they watched as the post-war boom and the reintroduction of GIs into the workforce transformed our economy from one of agricultural and industrial output into the greatest consumer economy the world has known.

In the postscript of his book “The Psychology of Money,” Morgan Housel lays out the daisy chain of events that led this transformation. The GI Bill extended lending terms to returning soldiers that allowed them to borrow money affordably. Production capacity and innovation borne out of the war effort put millions of veterans in steady jobs with increasing incomes and modest expectations of household luxury.

The answer to the question, “What are all these GIs going to do after the war?” was now obvious. They were going to buy stuff, with money earned from their jobs making new stuff, helped by cheap borrowed money to buy even more stuff.”

My mom and dad found themselves at a transition point between the easy credit and increasing lifestyle expectations of the post-war decades and the period of high inflation and darkening prospects of the mid 70’s. They had every reason to continue the country’s trend of debt-fueled consumption, but for a number of reasons, they chose to live simply. They rarely took on debt, taught their three boys how to build a budget, and wouldn’t give us our allowance until we turned in last month’s ledger detailing how we spent our “income.” In short, they had a good set of heads on their shoulders and bucked the trend of “more is better.”

Dad worked in finance. He was an electronics analyst for an old-line Wall Street firm. But he didn’t trust the market with good reason. During his lifetime, the stock market delivered paltry returns, and he had a front row seat to the 1973-74 recession and the junk bond mania of the early 80’s. His idea of a sound investment was a passbook account for each of his boys that paid simple interest of around 8%. And he invested in his job. His strongest identities were 1) family man and 2) loyal employee. Which is fine until your employer drops you like a bad habit.

Dad was a part of the layoffs that started with the 1984 market crash and concluded with the “big one” of 1987. Once he realized no one was hiring men for finance jobs in their late 50’s, Dad finished out his life working retail at a handful of small-box and big-box stores. He also finished things out single. His bouts with depression brought an end to his 27-year marriage that produced 3 decent boys. Even working customer service at RadioShack and Sears, Dad held his head high and did his jobs admirably. His identity as rock solid employee was intact. This eminently good man died in 2003. A paid-off townhouse, a small bank balance, and an outstanding bill for a new water heater was all he had left.

Mom worked as an accountant in the 1960’s until the fine people of Citibank informed her that “no one will take financial advice from a pregnant woman.” So, she stayed home throughout the 70’s and 80’s to raise her kids and support her husband through his tumultuous career path. After Dad’s second round of layoffs, Mom started taking jobs at churches and retreat centers as a program director and accountant. When things got really bad she took a fourth job in the form of a paper route (I was her co-pilot). After their divorce, Mom got ordained in the Episcopal church and began her journey in prison ministry.

One of mom’s jobs included room and board, so when it came time to divide assets in the divorce, Mom let Dad keep the house and in exchange kept his life insurance policy. Mom lived a very Spartan lifestyle for the years between her divorce and my Dad’s passing. As a first year teacher I out-earned her by a few hundred dollars, not including my plush public school health insurance plan.

When Dad died, Mom received a modest life insurance payout. Rather than using it to upgrade her Nissan Sentra, she spent not one dime, and did something my Dad was never willing to do–she learned to invest in the stock market.

Fast forward 17 years: Mom is living a life she couldn’t have imagined for herself just 20 years earlier. She’s not fantastically wealthy, but she’s free; free to do what she wants, when she wants, for however long she wants. She treated herself to a retirement home, where for the first time since she was a very young child, people were taking care of her for a change. And about every week or so I call her or she calls me and she says the same thing: “Oh Ted, I’m just so happy.” I wish that kind of ending for my dad. But you can’t influence the past, only the future.

I tell you this story to illustrate two things. First, assuming you’re a regular reader of this site, you might wonder why after long periods of silence I find myself writing about finance. In my last post I explained why I have become much more visible in my interest in investing. I find myself considering others’ stories, be they stories of companies, governments, consumers, or other investors doing meaningful things, and I find those stories increasingly relevant to the world around me, partially I believe, because I’m beginning to connect my investor identity to my other identities. And if I don’t write them down, these threads slip away as the next “big event” tumbles across the CNBC chyron.

Second, I wanted to share the lens through which I see the world of investing, through the lens of my parents. My dad had the intellect, the access and the resources to increase his odds of financial independence, but he didn’t. My mom scraped and saved and when a modest windfall hit, she learned what she needed to learn, and through a very conservative investing philosophy, she achieved financial independence in just 15 or so years. Dad was skeptical about the market. Mom had faith in responsible leadership of American businesses. Dad relied on his salary to provide for his family. Mom leveraged the wealth-creating potential of share ownership in a handful of companies. She also had a great gift, the greatest gift, which is the element that is most meaningful to me and to anyone reading this. She had time.

Faith, time, and a reasonable amount of homework. That’s what it took to change my mom’s story. Mom’s story can be anyone’s story. It’s the story I want for my family. It’s the story I share with my students as they begin their investing journey. It’s the story I share with my colleagues as they fear that a career in education won’t be enough to provide for their families.

What’s your story? Who’s writing it?