We begin with philosophies surrounding saving money.
Seth Streeter, co-founder of Mission Wealth Management keyed in on a need for “renewed perspective”:  “People typically either seek pleasure or avoid pain in their lives.  Thus, budgeting (and adhering to the budget) needs to be associated with the pleasure of getting what they want (i.e. a new car, less debt or financial freedom) or to avoiding what they don’t want (inability to buy things they want, feelings of financial stress/restriction or bankruptcy).

Human behavior is quite simple, we do what we WANT (if emotionally driven) or NEED (if intellectually driven) to do.  Thus, when a person’s wants and needs are aligned with the fruits of a budgeting exercise and adherence, it will get done.”

My favorite sister, Nicole Harding, focuses her attention and philosophies around the tangible dollar.  Feeling it and valuing it.  “We get so used to using plastic and not seeing the actual cash go out”…that it becomes harmful to our saving efforts.

A couple others focused in on the positive emotion that comes along with saving.
An associate of mine at Bank of America, Scott Lindberg, states, “It sure feels good when you have a visual representation of your net worth growing and your debt shrinking.  It’s really cool to see how your finances change over a long period of time… It’s motivating when you actually meet your budget goals and you can see the results in your graph.”

My client HC feels accomplished - “I really feel I have accomplished something- rather than just getting the discount.”

So if we believe the underlying philosophies and desire the feelings described by Scott and HC, wouldn’t it be helpful to have some tools in which to get there?

Daniel Howard, an employee of a cloud computing company in Santa Barbara, called Rightscale, believes in Mint.com as the tool of choice:  “I use Mint.com to manage my finances and budget.  It is free, secure and gives great insight into one’s allocation of funds.  It takes 10 minutes to sign up and reduces the amount of time needed to effectively manage spending by at least two fold.”

Scott Dinsmore, managing partner of Cumbre Capital Partners, agrees and adds to Daniel’s remarks:  “Mint.com is a sweet way to budget. Really fun. Good old fashioned piggy bank is a blast too. We used to do this when I lived in Sevilla. We never spent change and always paid with bills and then put all the moneda in a tin Heinneken can Mime…”

Given the tracking tools, it is only fitting to end with fun ideas and ways to be consistent about saving when out on the town.
HC gives us a couple of great ideas: “My fav is shopping on Tuesday @ Lazy Acres- (with a list of course!)  Tuesday is discount day for seniors - 10% off.  (you must ask your cashier for your discount)

I then take the 10% and ‘bank’ it, some for the future and some for ‘fun’.  Since I take the ’saved’ money and bank it, I really feel I have accomplished something, rather than just getting the discount. I take that amount and bank it some for the future and some for fun.  Granted it may take awhile to save enough to go out, but when I do it is a real treat. The money spent is not out of a tight budget and I, thus, have no guilt for doing it!

So, I get a triple reward –
1. on the day of the savings.
2. when I got out for dinner, or drinks or small trip
3. and then in the future when I have $$ for something else (like the electric bill - LOL)

Here is a tiny one for everyone- when I went finally went online to start paying bills I started saving the money I would have paid for stamps.  Anytime I change a habit to save money I take the saving and bank it.  Now that’s a high I can live with!”

Erin Pearson, Campaign Manager of Team in Training in Santa Barbara, adds a nice tip for coffee goers.

“I work from home, I like getting a coffee or a tea every single day at a coffee shop because i like GOING to the coffee shop itself. After reprimanding myself about this for years, trying not to and then failing, I realized something important: I like it.

1. I buy tea, or plain coffee to keep it under 2 bucks or just at two bucks.
2. Buy a gift card and reload it monthly to be at the amount of that drink.
3. Try to make it a business meeting so I can write off as much as possible.

I’m pretty good at this now, so I don’t even need to load up a gift card anymore. Over time, I just have a new habit of not overspending here.”

Thank you to all the contributors.  More of their stories and yours next week.
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PLAN
Catalyst for Thought - MINDS Lunches.  Coming up in March and April.  Gillian Christie, founder of Christie Communications and Wayne Rosing, early participant in creation of Google and now founder of Las Cumbres Observatories.  Register at www.CatalystSB.org to ensure you receive the registration emails.
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LEARN
Buzzword: Eighthed
“A slang term used to describe when one trader undercuts or outbids another’s ask or bid by one-eighth of a dollar. This term carries a derogatory connotation, as it implies an attempt to steal a trade by a small change in price.

The term is no longer used in the equity markets, as stocks are no longer quoted to an eighth of a dollar. A trader may use the term in the context of ‘being eighthed’ or claiming that someone topped or cut them ‘by an eighth.’”  -Investopedia.com

  Six Points to Ponder:

   1. Confused Markets.  The Markets spiked and plummeted throughout the week.  We’re left with an ulcer and our money right where it began. - The Dow is down only 6pts, to 10,321. The S&P 500 up 2, 1102.  And the Nasdaq up slightly, 2234.  Oil is flat, $78/bbl.
   2. Greeks Go Marching.  Strikes are halting everything in Athens as discontent mounts over the government’s austerity measures.  The government is proposing painful cutbacks.
   3. Undulating Housing Market.  Last week housing stats were happy, now they are grim for builders.  New-Home Sales fell 11.2% in January. Bernanke stated this week rates affecting customers will remain low for some time.  
   4. Toyota Makes Recalls Fashionable.  Nissan, Suzuki and Daihatsu begin recalls this Friday.  These business owners are evidently lonely and in need of some media attention.
   5. Intel’s Intelligence Investment. They’ll be starting a $2bn investment fund.  They are teaming up with venture-capital firms to invest solely in US Companies. This will be one long-term aid to lower unemployment.
   6. Curdling Curling.   No longer is curling left to the random Canadian channel.  It has come to your main broadcasting stations.  Who wants to trade curling pins?  Isn’t there anything else on? 

Positives:

    *  Whether Intel is starting the fund for political reasons in hopes of overcoming the many cases brought against them of late, or out of belief they must stimulate the American economy in order to succeed, it is going to be a nice benefit to many small businesses across the nation.  Begin editing your business plans now.
    * The USA leads the Olympic medal count after taking its first gold ever in the Nordic Combined today, 30 to 26 over the Germans.

 Negatives:

   * Those applying for unemployment services this past week were up much higher than expected, leading many to worry about our nation’s progress in solving the unemployment dilemma.  It is the government’s main focus at the moment as demonstrated through a new bill passed, $15Bn more toward job creation.
    * Pertaining to the Greeks, this is a very difficult issue.  The Greek government has no choice but to lower their deficits.  They are on a crash course otherwise, which could disrupt the European Union first and the markets abroad quickly thereafter.  There is great pressure on their shoulders.  The Greek workers are the ones that lose out though.  They lose jobs.  They have a right to be angry.  But might they be able to take a different perspective?
    * Is it that difficult to make a dependable car?  The urgency of new makes and models offering the latest gadgets, are surely a part of this dismal puzzle.  Other interesting car news: GM unable to sell part of its line to a Chinese interest, decided to stop production of the Hallmark of American Gas Guzzlers, the Hummer.
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GET INVOLVED
Local:

Muhammed Yunus, Nobel Peace Prize 2006
Where: Fred Kavli Theatre, Thousand Oaks Civic Arts
When: Friday, February 26th, 4pm.
Cost: $20 + extra charges = $36.
Why:  Hear from the man that made microfinance famous and has given millions of women in the developing world opportunities never before imaginable.  If you don’t know anything about microfinance, there is no better person from which to learn.
How: Go on ticketmaster.com and buy a ticket.
For other fun ideas, go to www.lovemikana.com

Live and Be Well,

Jeff Bochsler

In discussions over the budget deficit, people often point the finger at “horribly greedy bureaucrats”.   “A party of a few are ruining our nation.”  “Warmongers”.  “Our children will suffer.”  “Inflation is imminent.”  “The day of America’s judgment is close at hand.”  Such ideas will forever be quibbled over in debates.

But might it be important to analyze it all from a more democratic perspective?  The democratic belief upon which we stand?

The government represents the people, in all ways.  In this context, when the people are smartly managing their own income, debts, spending habits, and disciplines, then often the government fares well.  Tax revenues rise.  Deficits fall.  Jobs are created.  Creativity prospers.  The government as an end results emulates its people and borrows less.

So how do we change the people?  Will a budget commission on Capitol Hill change the individuals’ disciplines, choices and patterns?  Or does it start by educating and reprogramming the way people experience money and interact with their personal finances?

Amidst the “Great Recession” it seems hard not to analyze personal income, assets, and debts.  However, we must go one step further.  We must prevent the false economy of the mid-2000’s from happening again.  We must figure out a way to be consistent with our money for the long-long term.  We must find a way to make saving money more enjoyable.  It may not be as sexy, but it still can be plenty of fun.

Our starting point and challenge: Many absolutely hate the thought of budgeting.  Many dread pulling open their credit card statement and seeing the mound of money owed.  Many want to go on an extravagant vacation, guilt free, despite a lack of savings.

I have my own ideas regarding how to make sticking to a budget more exciting, how to make saving two bucks at the grocery line more rewarding, but I’d like to hear yours.  Next week I’ll be including some of the most creative in the Market Street Report.  So report back to me.  One sentence or many paragraphs.  All are welcome.

For this simple act of individuals creating their own budget commissions will have a far greater impact on America’s budget than any govern-mental commission.
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PLAN
Catalyst for Thought - MINDS Lunches.  Klaus Schauser, one of the founders of Expert City which later became Citrix Online, will be joining us next week.  Register at www.CatalystSB.org to ensure you receive the registration emails.
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LEARN
Buzzword: Camouflage Compensation
“Compensation that is granted to upper echelon employees, directors, consultants and related parties that is not fully disclosed in mandatory company filings. In other cases, compensation is fully disclosed, but in such a way that it is very difficult for the average investor to decipher the true value of gross pay compensation.

Non-qualified deferred compensation plans, SERPs, stock options, stock appreciation rights and share grants are all potential places where compensation can be hidden from analysts and shareholders. The SEC has proposed new regulations to more completely disclose the full cost of compensation to related parties, consultants, directors and employees.”  -Investopedia.com

  Five Points to Ponder:

   1. Winter Waves.  The Markets have undulated over sovereign debt fears, double dips, better corporate numbers, and increased unemployment benefit requests. - The Dow is up to 10,327. The S&P 500, 1100.  And the Nasdaq up, 2228.  Oil is currently $78/bbl.
   2. Microsoft and Yahoo! Unite. In efforts to compete with Google’s search engine, Microsoft and Yahoo! received good news regarding their alliance from the American and European regulators.  All is clear.
   3. Happy Housing Starts.  Hopeful news came in for the real estate industry as January data marked the 6 month in a row housing starts increased.
   4. Sip More Soup.  Campbell’s Soup has lowered their earning projections going forward.  WalMart foresees soft times ahead domestically, too. 
   5. Olympics, eh?   We’ve already seen the highs and truest of lows.  Poles lead in last place finishes.  Tiger Speaks. Tomorrow morning he’ll address past and future. 

Positives:

    * 80% of the S&P 500 corporations are expected to beat the street estimates this quarter for the first time in eight quarters.  This fact coupled with the Fed beginning to feel more confident about the overall state of the US economy boosted stocks prices this week.  The Fed projects unemployment rates to recover in 2011 and 2012 to the 6 and 7 percent range while inflation hovers between 2 and 4 percent.  Inflationary levels at or below 2 percent are most ideal, but given the current market state, 4 percent isn’t reason for intense concern.  Moreover, leading indicators rose at a .3 percent level.  This is meager progress, but progress nonetheless.
    * Bing and Yahoo! coming together will only better internet users experiences, whether they make the switch over from Google or stay with Google.  The increased competition should spur Google on to better, more accurate searches in efforts to stay ahead of the big behemoths crying out for internet eyes.
    * The housing market, since September 2009, has been noticeably different.  Many have been stimulated by the tax incentive to take advantage and buy while rates and home prices are low.  The builders are sensing this increased activity and have begun ramping up their housing starts.  There must be some caution though as leading indicators in this sector look to project a tempering.  Many in the industry believe post “tax incentive”, the end of June, buyers will climb back up on the fence to observe the landscape.  The second half of the year does indeed present some headwinds.
    * The Winter Olympics have begun!  Yesterday, Lindsey Vonn became the first American woman to win the downhill since the 30s.  Shaun White, stud snowboarder, threw a Double McTwist 1260, a trick he failed to land in the X-Games last night, propelling himself into his second gold medal.  And Shani Davis, after passing on the 500m race, out raced a crafty Korean in speed skating to repeat in the 1000m. 
    * Medal Count:   US - 14  Germany - 10  France - 7.

Negatives:

    * Americans aren’t having enough soup says Campbell’s.  I’m a bit surprised by this since soup is one of the cheaper items in which to compose a meal and it is one of the tastiest.  That said, I hope their projections of a soft 2010 doesn’t lead to more Donovan McNabb commercials - “Gotta make sure you’re eating good.”
    * The luger from the country of Georgia who died while practicing on the quick turns of Vancouver.
    * The media surrounding Tiger Woods’ return.  Gossip and speculation continue.
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GET INVOLVED
Local:

DPHS Comedy Night Fundraiser
Where: Dos Pueblos High School
When: Friday, February 19th.  7:30pm.
Cost: $8 - $10
Why:  Laugh while supporting the kids.  Hosted by alumni Josh Duvendeck.  Improv and stand-up comedy.
For other fun ideas, go to www.lovemikana.com

Live and Be Well,

Jeff Bochsler

His shoes shined.
Her hair furled.
His pants pressed.
Her lashes curled.
His shirt clean.
Her lips glean.
His face shaven.
Her dress curve’n.
The roses bundled.
The reservations set.
A night intended to never forget.

Whether you appreciate this Hallmark holiday or do everything to avoid red February 14th, it is a day from which we can all learn.

Let’s transport back to elementary school.  The classroom is bustling with creative minds working collectively to turn drab walls and yellow tarnished desks into rosy shades of red.  Kids love Valentine’s Day.  It becomes an art project and a lesson on giving.  Colorful cards and love commentary are inked with very confidently written squiggled first names.

Or maybe I’m getting a bit too poetic.  Maybe it’s just about the candy.   Halloween seems like a distant past.  Pillow cases are now empty.  It is time to refill.

Whatever the selfish or selfless motives of these little rascals, they love it.  They are proud to care for others.  They are entirely present in every card they write.

And the culture in which is created, lasts for weeks after the day.

You may have grown more mature and have a past of many less than positively emotional Valentines, but this should not hold you back from expressing intense appreciation for those around you.

I’ll leave it up to you in how you show this appreciation to family, friends and a special loved one.

But I would like to encourage you in the form of business appreciation.  We must never forget to let those in our business know that they are important to us.  Show you care.

The most successful executives and managers I’ve met have been almost neurotic about serving their employees and customer.  They go through great lengths to show their customer, their community and their people that they care.

They care for the smallest details.  They listen to clients during times of crisis even when it has no relation to the business at hand.  They look after the employees’ children by setting up a day care center.  They send flowers and gift baskets.  They offer extra benefits.  They throw company barbecues that promote community.

In doing this all, you are creating a company culture.  A culture of trust that cannot be matched by competitors.  An environment of which competitors’ employees want to be a part.  You are becoming a leader in which people want to follow because you actually care about their well being.

You see, the world is in desperate need of a hug.  Love.  Amor.  Amour.  Amore.  Liebe.  Cinta.  Ai.  Your clients are in need of a hug.  Your office is in need of a hug.  Blast them with goofy, creative, and thoughtful acts of appreciation. 

…You might also include candy, just to be safe.
___________________________________________________________________
PLAN
Catalyst for Thought - MINDS Lunches.  Klaus Schauser, one of the founders of Expert City which later became Citrix Online, will be joining us in late February.  Register at www.CatalystSB.org to ensure you receive the registration emails.
___________________________________________________________________
LEARN
Buzzword: White-Shoe Firm
“A slang term for a broker-dealer firm that is strongly against hostile takeover practices.

The white-shoe firm’s name is derived from the white buck shoes that were a fashion requirement within elite social organizations in the 1950s. “  -Investopedia.com

  Six Points to Ponder:

   1. Fly Injured One.  The Markets fluttered its wings this week starting February off with a couple days of solid rises. Job declines slowed. Manufacturing picked up. - The Dow is up to 10,262. The S&P 500 followed suit, 1098.  And the Nasdaq finds itself flat from last week, 2183.  Oil is up $3 to $77/bbl.
   2. Small Business Support. Dolling Out Dollars.  President Obama proposed a plan to shell out $30Bn in efforts to boost small business activity.
   3. Greek Austerity. The EU endorsed the Greeks’ plans to reduce their deficit.
   4. Pending Home Sales Up. 1% increase in December over November 2009.  A forward looking indicator that bodes well for real estate in Q1 2010.
   5. Unclaimed Property.  In doing some saving research, I came across a site that allows you to search any outstanding money you are owed. See below.
   6. Superbowl Sunday Funday.   Superbowl parties are in abundance.  Sunday the Colts take on the Saints in a wild showdown.  Australian Open.  Williams and Federer claim top ranks, again.

Positives:

    * Whenever negative news and data points begin to slow, the Markets respond positively.  It gives them reason to believe the worst has come and gone.  Moving forward there is a high likelihood that we’ll remain flat or even begin to slightly improve from our current state, in the medium-term.  Whether you believe this or not is up to you, but this is why you are seeing the stock market perform better than you may feel it should.  They are projecting what you will feel, in economic terms, months ahead, rather than today’s current situation.
    * Support for small businesses, if done correctly and not siphoned off or secured away in savings accounts, could really help stimulate the overall economy.  The challenge lies in small business owner confidence.  For example, if I have been given a large check by a friend and told to spend it, I may wait to see if I need it for necessities before I go spending it on frivolous things.  The business owner will think the same way.  This is one of the many challenges President Obama faces in dolling out dollars.
    * The European Markets along with the foreign exchange indexes appreciated the EU’s endorsement of the Greek’s austerity plan.  Without the EU’s backing, there was high alert for a Greek government failing, calling on bankruptcy.  There are still many more tough decisions and cuts to be made, so all is not rosy.  Either way, the Euro is up today over the dollar.  Mierde.  More expensive foreign traveling for us Americans.
    * Pending home sales data points represent the number of homes that have received accepted offers and are now in escrow.  Within the next 30 - 60 days these homes are expected to close and become official sales.  Being that they were up in December over November, we can expect higher sales numbers come January and February reports.  I’ve witnessed many of my clients falling into this pending home category over the last couple of weeks.  The climate is ripe for purchasing.  Low home prices.  Low rates.  High tax incentives.  I still urge all buyers to buy a place they could see themselves in for many years to come.
    *Upon my posting of the unclaimed property site, I received text and Facebook messages confirming over $1000 in discovered dollars.  Please be sure to check out the site and the different states in which you’ve lived.  http://www.betterbudgeting.com/unclaimedmoney.htm. You too might be owed money!
    * Superbowl Sunday Funday is always a positive.   Chili, cream cheese dip!  Pizza dip!  Good friends yelling at a television…
    * Last Reminder: Verizon Wireless and AT&T have just lowered their monthly service fees.  Unlimited minutes and texts are only $69.99 / month.  I called yesterday and was able to update my plan, saving $25 / month.  Call your carrier today and save yourself dollars.

Negatives:

    * We’re taking a week off from anything negative.  Valentine’s colored glasses.

GET INVOLVED
Local:

Santa Barbara Film Festival Kickoff.
Where: The Arlington for the Red Carpet.  After party will be at Paseo Nuevo.
When: Thursday, February 4th.  7pm.
Cost: $65
Why:  Get out with the stars.  See creative works.  Experience your Santa Barbara community in glitz.
For other fun ideas, go to www.lovemikana.com

Live and Be Well,

Jeff Bochsler

You see, we’re each far more capable than we give ourselves credit.

Maybe we aren’t sponsored and paid to train ourselves to such levels as a man that can run 300 miles continuously or 26.2 miles for 50 straight days while living out of a motor home and getting 2 - 4 hours of sleep per night.   But we can run or walk one marathon.

We may not be able, or willing, to spend months waking up early in the morning to hold our breath for five and a half minutes, hyper-ventilate for one minute, then repeat nine times, over the course of the hour, thus, holding our breath for 52 minutes of the first 60 minutes we’re awake, all in training for a pure oxygen induced breath holding record.  But we are able to swim three consecutive hours, covering 10,000 meters on our 46th birthday, like a friend of mine did earlier this week.  A past college swimmer, this was the first time he’d ever eclipsed this mark in one set of swimming.

It is hard to imagine when I arrived to Santa Barbara I didn’t believe in marathons.  I had never done one, nor did I have any intention of doing one.  “They are terrible for your body,” I proclaimed.  This may be true if done excessively or improperly trained, but if done right it can be a feat that leaves you lying in the grass, devouring every sweet or salty snack in range, feeling on top of the world and questioning whether there is anything in life that can’t be done.

It is a feat indeed, even for runners.

Do you dream of feats you’d like to accomplish?

Start with small feats.  Eventually challenge yourself with new and bigger feats.  Climb Mount Kilimanjaro.  Hike Machu Picchu.  Maybe it’s much simpler than these.  Either way, be disciplined.  Be focused.  Enjoy the journey.  Then bask in the huge accomplishment and the reminder of how capable you really are.

I’m fascinated by it all.  Maybe this is why I made my mom buy the Guinness Book of World Records each year growing up.

Look it up online.  Perhaps you should buy a copy.  Be inspired.

My next feat?  I’m starting with the Romeo’s Run this Saturday.  Who wants to join me?  …baby steps.
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PLAN
Catalyst for Thought - MINDS Lunches.  Today, Jim Eiting, past CEO and now Chairman of Midmark, a $300m medical device company and author of the recently released book, Focus for Success.  Klaus Schauser, one of the founders of Expert City which later became Citrix Online, will be joining us in late February.  Register at www.CatalystSB.org to ensure you receive the registration emails.
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LEARN
Buzzword: Fractal…think broccoli.
“A rough or fragmented geometric shape that can be split into parts, each of which is (at least approximately) a reduced-size copy of the whole, a property called self-similarity.

Because they appear similar at all levels of magnification, fractals are often considered to be infinitely complex.  Natural objects that are approximated by fractals  to a degree include …snow flakes, various vegetables (cauliflower and broccoli), and animal coloration patterns.”  -wikipedia.com

One’s personality, if being true to oneself, should emulate a fractal nature.  Personality seen when interacting with one would then be experienced and show through with many.

  Six Points to Ponder:

   1. Flat Fed. Falling Market.  The Markets have been battered during this corporate earnings season.  Investors were hoping reports would prove we’re out of the woods.  Not so. The Fed concurs.  Headwinds continue, Fed kept rates flat.                                                                                                                             - The Dow dropped 4% in a week to 10,161. The S&P 500 followed suit, 1090.  And the Nasdaq finds itself down over 100 to 2191.  Oil is down to $74/bbl.
   2. State of the Union.  Humility and hope.  President Obama called himself out for failings in the first year while pressing forward with the notion of job creation and small business support.  Large banks are the new axis of evil.
   3. Toyota Trips.  5.3 million and counting.  That’s the number of cars Toyota is recalling from their fleet.  The problem?  Too much pedal to the metal. 
   4. Funny FDA.   Wisconsin Cheeseman recalls Cheese Balls.  MuscleMaster.com recalls 17 supplements  that “surprisingly” contain steroids.  Merrick Pet Care pulls HAPPYTOT  and HAPPYBABY.
   5. iPad Excitement.  Apple continued its sprint into the future.  Wednesday, Steve Jobs, welcomed into the world iPad.
   6. Favre Flails.   Will the real Brett Favre please stand up?  Favre did in the final moments of the Vikings loss against the Saints.  Two bad decisions led to their demise.  Australian Open.  Chinese women are out.  Serena vs. Henin in the Finals.  Murray could meet Federer.

Positives:

    * I just discovered that the FDA puts out a report on recalls.  At first I thought men with terrible jokes were being pulled from society.  “Cheese Balls, recalled.”  In reading the details, I quickly realized I’m safe.  That said, I did learn of a bacteria called “listeria monocytogenes is one of the most virulent foodborne pathogens with 20 to 30 percent of clinical infections resulting in death.”  This is more than Salmonella.  He’s a little guy but packs a mean punch.  I suspect he’s French, as he loves soft cheeses.  2500 illnesses and 500 deaths each year. Who would have known?  Anyhow, a few more funny recalls: “Publix Pumpkin Pecan Streusel Pie” issued a recall because of allergy concerns and their mislabeling.  Supposedly they should have declared “pecans” were included in the small print.  Isn’t it in the name of the product?  Oh and in case you were wondering, the Boiled Horse Mackerel was also pulled from the shelves.  Should you wish to stay up-to-date on such hilarity and body altering bacterium,visit:  http://www.fda.gov/aboutFDA/ContactFDA/StayInFormed/RSSFeeds/Recalls/rss.xml
    * More fun technology toys are on their way.  The iPad, whether you buy one upon release or its main competitor in the next couple of years, such a device will become part of your life.  Bill Gates envisioned a similar device 10 years ago when proclaiming the tablet.  Sorry Bill, Jobs wins this one.  The technology and price points have finally found common ground to be of interest to the average user.  The only thing I’m now concerned about is waiting in line at the airports.  “All laptops, iPods, and iPads.  Please take them out of your bag and put them in separate bins.”
    * Two class acts are leading their teams into the Super Bowl.  Peyton Manning and Drew Brees will clash on February 7th.  These are two deserving teams that were nearly undefeated the entire season.  Two powerful offenses with timely enough defenses to win often and often win big.  “Who dat?  Who dat?  Who dat gonna beat dem Saints?!”
    * Reminder: Verizon Wireless and AT&T have just lowered their monthly service fees.  Unlimited minutes and texts are only $69.99 / month.  I called yesterday and was able to update my plan, saving $25 / month.  Call your carrier today and save yourself dollars.

Negatives:

    * Despite corporations proclaiming higher profits, investors aren’t happy.  The higher profits appear to be resulting from “leaner” operations rather than heightened spending by the American people.  Yes, people have loosened their pocket books, but not at any rate that gives investors confidence the light is near.  Moreover, jobless numbers continue to remain high.  Those filing for unemployment benefits were above estimations, and durable goods orders, a good measure of manufacturing, were up, but not as much as projected.  In short, the economy is recovery, but rather slowly.  People are inherently impatient.  Investors are even more so.  We’re walking forward.  Soon we’ll begin trotting, then jogging, then running.  Just be patient.
    * The State of the Union Address is not a negative because of what was said.  More it is a negative because of how difficult it is to make change in Washington.  Whether one differs in opinion with the President and his priorities, I think we can all agree job creation is a must.  Moreover, we’d all like to see small businesses better thrive.  How we better both situations is a matter of opinion, fixing charts and graphs to match one’s beliefs, etc…  But sadly, at the end of the day, Congress is a huge ship which is reluctant to change course.  It is said that there were many standing ovations across party lines last night during the President speech.  The hope is they all return to their office and work as they believe in their heart, rather than what will keep them in good favor with their party.  For this, I’m not “optimistic with a raincoat”, more a “skeptic with my swimsuit”?
    * How would you feel if you were the CEO of Toyota right now?  The company, in efforts to over take GM and become the largest car maker in the world, expanded too quickly, ultimately sacrificing quality.  5.3 million cars!  Many models are made on the same assembly lines. 8 models in total.   This is the main reason for the high level of recalls.  They all use many of the same parts.  In this instance, Henry Ford wouldn’t be quite so proud of his assembly line creation.
    * Haiti’s struggles continue.  It is estimated that 20,000 Haitians are dying each day because of insufficient medical supplies.  Should you still wish to donate, visit this link and find your favorite group to support.                                        http://www.msnbc.msn.com/id/34835478/ns/world_news-americas/
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GET INVOLVED
Local:

Romeo’s 4 Miler
Where: UCSB’s Campus
When: Saturday, January 30th.  9am - Individual Race.  10am - Couples Race.
Cost: $25
Why:  Check in to see your early year running progress or have fun running with a special someone.  Then again, line up a ringer and win the thing.  $1000 in prizes will be given out.   Go online to http://www.ucsbruns.com/romeo
For other fun ideas, go to www.lovemikana.com

Live and Be Well,

Jeff Bochsler

For example, if you want to know how long it will take your $2000 investment to grow into $4000, divide your rate of return into 72.  Let’s assume, in this example, that you have a good financial planner and the rate of return earned is 8% each year.  Each year your money will grow by 8%.  We then divide 8 into 72, pull out our multiplication tables from third grade, and get the answer of 9.  Thus, in 9 years your money will grow from $2000 to $4000 without any extra effort.  In the following 9 years your money will compound into $8000.  Then $16,000.  Then $32,000.  Within 36 years you will have doubled your money four times.  You’re now two to the fourth times wealthier!

In marathon training, it’s recommended a runner doesn’t increase their mileage by more than 10% each week.  This steady increase prevents injury while at the same time encouraging progress.  Going from 10 miles per week to 11 miles doesn’t seem like much, but if you use the power of 72, maintaining a 10 percent increase, within a matter of 7.2 weeks you will have doubled your mileage.   Within 14 weeks, just over 3 months, you will have amped up your mileage to 40 miles per week.  That works out to 8 miles per day, assuming 5 workouts per week.  8 miles is more than a 10k race.

This is powerful information.

For one that is concerned about arriving to the finish line of a marathon it is much easier mentally to break the training up into smaller, more manageable parts.  “All I have to do is increase my training by 10 percent this week.”  Within less than 20 weeks they’ll be ready for a marathon.

Translate this into anything you want to accomplish.  Read more books?  Read 10 percent more each week.  Instead of 50 pages this week, read 55 pages.  In less than two months you will be reading 100 pages per week.  Within 3 months you will be reading 200 pages, nearly an entire book each week.

Want to get stronger?  Go from 10 pound to 11 pound weights within two weeks.  Within 14 weeks you’ll be lifting 20 pound weights and impressing a few fellow gym goers.

How about intelligence?  All you have to gain is 10% more knowledge each year and you’ll double your intelligence in less than a decade.  In 2017, watch out, I’m going to be twice as smart.  …and more than likely, twice as obnoxious.  That’s beside the point.

Of course there is a limit as this doubling compounds rather quickly.  Double two thousand ten times and you arrive at over two million.  But the reality of this limit is unknown until your reach it.  It is said, we only use 10 to 20 percent of our brain capacity.  Might we all have plenty of space to grow in this category?

Compound Your Knowledge.  Compound You.
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PLAN
Catalyst for Thought - MINDS Lunches.  Within the coming weeks 10 person lunches will be shared with Paul Orfalea, founder of Kinkos (SOLD OUT), and Jim Eiting, past CEO and now Chairman of Midmark, a $300m medical device company and author of the recently released book, Focus for Success.  Klaus Schauser, one of the founders of Expert City which later became Citrix Online, will also be joining us.  Register at www.CatalystSB.org to ensure you receive the registration emails.
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LEARN
Buzzword: Boomernomics
“An investing strategy that involves buying equities directly related to the spending behavior of baby boomers (people born between 1946 and 1964).

Areas such as biotech, healthcare, and luxury cars are the kinds of companies that stand to benefit from this age group.  People using the bommernomics investing strategy also invest in companies that offer products such as motor homes or dentures, which are geared toward aging or retiring consumers.”  -Investopedia.com

  Six Points to Ponder:

   1. Corporate Earnings Continue.  The Markets did not appreciate the corporate earnings this week.  Though corporate earnings have tended to beat the Street’s expectations, there’s concern they’ll have trouble matching in the coming quarters.     - The Dow scaled down to 10,577, S&P 500 migrated South to 1139 and the Nasdaq meander to 2307.  Oil is down to $77/bbl.
   2. Health Care Bill Stunted By Senate. The replacement of Ted Kennedy by a Republican in Massachusetts has President Obama back-pedaling on his health reform.
   3. FHA Flounders.  As the FHA budget drowns, on the brink of bankruptcy, they have decided to tighten their underwriting standards and increase their upfront fees. 
   4. Kraft Cradles Cadbury.   Have you ever considered how a Velveta Cheese filled Cadbury egg would taste?  Kraft purchased Cadbury for over $19Bn this week setting us up for such possibilities. 
   5. Rent Videos On YouTube.  YouTube, owned by Google, looks to attract more professional content by delivering paid video options rather than the current, watch an ad first option. 
   6. High Flying Hopefuls.   Favre vs. Brees.  Manning vs. Sanchez.  This weekend’s NFL playoff games will be filled with aerial stunts and a bit of trickery.  Australian Open.  Tennis season is kicking off with some exciting tennis Down Under.  The big hitters are still in.  Round 3 of 7 begins today.

Positives:

    * The Senate Democrats, before this week’s election, had a fillibuster-proof majority.  In short, they had enough seats to vote through whichever bill served their parties interest.  With the election of a Republican to fill the deceased Ted Kennedy’s seat, no longer is this the case.  I believe this is a positive, less because of my stance on any particular issue, but more because this new reality encourages people to vote with their intellect rather than along party lines.
    * YouTube’s offering of paid videos offers business owners a new avenue of revenue.  The video creators will be able to set the price for their video rentals.  If you are a fitness trainer and want to offer a training video, create a video and upload it to YouTube.  Charge for views.  Health, education, business seminars?
    * Aside from Mark Sanchez, the other three remaining NFL QBs could easily throw for over 300 yards this weekend.  400 yards isn’t even out of the question.  The biggest question mark, thus, is who will let their excitement overwhelm them.  Will the old, as in the past, Brett Favre show up throwing off his back foot and blowing key drives with terrible decision interceptions?  Or is he more emotionally sound at the young age of 40?  This is Drew Brees debut on the main stage.  All know who he is, but a big win this weekend will catapult him into the category of great quarterbacks of the past decade.  Peyton Manning is already there.  He just needs to spot the Jets trickery and dissect as he loves to do.  Interceptions could be his fall.
    * Verizon Wireless has just lowered their monthly service fees.  Unlimited minutes and texts are only $69.99 / month.  I called yesterday and was able to update my plan, saving $25 / month.  AT&T, its major competitor, has been forced to follow suit.  Call your carrier today and save yourself dollars.

Negatives:

    * China’s economy a “bubble”?  The Chinese government looks to be taking measures in efforts of slowing down growth.  Much of growth has come from the real estate sector and excessive lending.  Might our recent experience be able to aid them in their abilities to stave off a meltdown?  Pull back too quickly and you have problems.  Let it go on and you have issues.  Either way, it has American investors nervous.  Couple these concerns with our own domestic headwinds, and you have a 100 plus point drop in the Dow yesterday.  Other notables include Goldman Saks profiting $4.9Bn last quarter, BofA coming just short of profiting in their quarter, Wells Fargo profiting slightly, IBM having a strong quarter (but seeing their stock fall 2.9 percent), JP Morgan Chase showing stronger earnings, and Intel, too, having a better than expected quarter.  Positive reports are good news.  However, they are coming as a result of lowering cost structures, rather than by overall economic and revenue growth.  Investors want to see Americans start spending again before they become too optimistic about reports.
    * FHA has put itself in a pickle as a result of its terrible financing.  When subprime mortgages fell off the lending map two years ago, FHA happily stepped in to filled the void.  Low credit scores?  Not a problem?  Minimum down payment?  Sure.  Gift money from a relative?  Why not.   These underwriting standards have them facing high delinquencies and, thus, low reserves to cover future losses.  They are left with no other choice but to increase their fees.  The Upfront Mortgage Insurance Premium, a fee that is charged at the funding of the loan and used as a “pay-to-play”, will be increased from 1.75% to 2.25%.  On a $400K loan, this results in a $2000 cost increase.  Along with these fees comes stricter guidelines, many of which aren’t fully describable, but will surely have an effect on thousands/millions trying to qualify.
    * Haiti’s struggles continue.  It is estimated that 20,000 Haitians are dying each day because of insufficient medical supplies.  Should you still wish to donate, visit this link and find your favorite group to support.                                        http://www.msnbc.msn.com/id/34835478/ns/world_news-americas/
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GET INVOLVED
Local:

Australia Day Festival
Where: Santa Barbara Maritime Museum
When: Saturday, January 23rd.  4pm - 11pm
Cost: $50.
Why:  Holy Kraike!  Who doesn’t enjoy the Australians?
Go online to www.australiadayfestival.com
For other fun ideas, go to www.lovemikana.com

Live and Be Well,

Jeff Bochsler

We hear this word rather often when discussing how to build out an idea, grow ones business, or even operate an efficient household where the kids have responsibility.   Have you ever looked up the definition?

I love the web’s definition of delegate:
“•transfer power to someone
•give an assignment to (a person) to a post, or assign a task to (a person)
•a person appointed or elected to represent others”

When you “transfer power to someone” you are often empowering them.  You are handing over the reigns.  This in and of itself is reason to consider delegating.  I feel it okay to write this, while not at all promoting abuse, for those within my email list are stand-up citizens.  You consistently make respectful decisions that aren’t abusive in nature.

Having said that, what is not in the description is how delegating can empower the delegator.  If delegating correctly, you can get more accomplished.  In getting more accomplished, you are encouraged to dream bigger.  In dreaming bigger, you are able to pinnacle at Mount Everest rather than the mole hill out back.

To delegate effectively you must know thyself.  What are your strengths?  What are your weaknesses?  Basic.  But implementation is rather difficult.  Why?

Example: Being an academic by nature, delegating is difficult for me.  I want to be good at everything.  I want to be good at both math and history.  I want have the ability to write a novel while understanding geology.  If I’m not good at something, I want to work on it.  So when I ask for help, I feel like I’m slacking.  I’m telling the world I’m not good enough at the particular task.

Great delegators will tell me to think otherwise.  Yes, it is good to work on your weaknesses, but it is also good to recognize them and find help from someone in which this area comes easy.

I ask us all, thus, to spend the next week focusing on our weaknesses.  Let them not depress us, but let us laugh about them.  Let us make light of them.  This is who we are.   We can’t be good at everything.  However, we have six billion people in the world to help us in the areas in which we fall.  Might it be more empowering to solicit a few of them to march along your side?
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PLAN
Catalyst for Thought - MINDS Lunches.  Within the coming weeks 10 person lunches will be shared with Paul Orfalea, founder of Kinkos (SOLD OUT), and Jim Eiting, past CEO and now Chairman of Midmark, a $300m medical device company and author of the recently released book, Focus for Success.  Klaus Schauser, one of the founders of Expert City which later became Citrix Online, will also be joining us.  Register at www.CatalystSB.org to ensure you receive the registration emails.
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LEARN
Buzzword: Fool in the Shower
“A phrase used to describe the idea that changes or policies designed to alter the course of the economy should be done slowly, rather than all at once. It describes a scenario where a central bank, such as the Federal Reserve acts to stimulate or slow down an economy. When the first stimulus is made, the effect may not be immediate, which can cause decision makers to increase the magnitude of the change, eventually causing too much stimulus.

The phrase is attributed to Nobel laureate Milton Friedman, who likened a central bank that acted too forcefully to a fool in the shower. When the fool realizes that the water is too cold, he turns on the hot water. However, the hot water takes a while to arrive, so the fool simply turns the hot water up all the way, eventually scalding himself.

Any change made to stimulate a broad economy, especially one as large as the U.S. takes time to work its way through. A move like lowering the fed funds rate takes about six months to fully integrate into the economy. Therefore, economists are always cautious about overreaching and prefer small consistent steps to enact change.”  -Investopedia.com

  Six Points to Ponder:

   1. Corporate Earnings.  The Markets were mixed this week as earning announcements clouded over other headlines.   - The Dow scaled up to 10,710, S&P 500 migrated North to 1148 and the Nasdaq meander to 2316.  Oil is down to $79/bbl.
   2. Bank Tax. The Obama Administration is currently drawing up plans to tax large banks in efforts to gain back lost bailout funds and punish banks for large bonus structures.
   3. Car Electronics Zoom.  With the consumer electronics show last week and the car show this week, car gadgets and gizmos are zooming into the future.
   4. Google Straddling Great Wall.  Recent speculation over the Chinese government hacking into Chinese Gmail user accounts coupled with their heightened censorship, has Google questioning whether they’re willing to stay in China. Moral dilemma?  Stand up to China and lose 35% market share?
   5. Haiti 7.0 Hiatus. A 7.0 Earthquake has the island of Haiti in shambles.  Over 3 million Haitians have been effected, with over 100,000 presumably dead.  Anxious to support? Visit: http://www.cnn.com/2010/LIVING/01/13/haiti.earthquake.how.to.help/?hpt=Sbin
   6. Champion ‘Bama.   The Heisman and his fellow comrades hobbled then pinned a tough Texas team to win the National Championship.  New faces in the Super Bowl?  Steelers and Patriots are out.

Positives:

    * There is optimism going into the heart of this earnings period.  The Markets are nearing 11,000.  Intel beat earning projections.  Layoffs are beginning to slow.  And Americans are beginning to spend, not much, but 15% more than a year ago. Moreover, oil at $80 per barrel is close to the optimal price level for economic progress while at the same time promoting green technologies.
    * “The Consumer Electronics Association [is] predicting sales of in-vehicle technology to top out at more than $9.3 billion in 2009 once the dust settles…”  This is a huge industry.  “As another Ford exec pointed out, even tires and auto glass contain electrical components, thanks to tire-pressure monitoring systems and windshield-mounted radio antennas.”  Now if only they could make a mass push for true “smart” cars that operate without a driver.
    * The Google Moral Dilemma I’m putting in the positive category for a couple reasons.  First, I believe the press it promotes regarding freedom of speech in China will, over time, lead to positive outcomes for not just the Chinese 1.2 billion, but also the world at large.   Google is throwing its weight around and rousing up the Chinese people. Having 1.2 billion more people being able to exchange and transfer information without worry, ultimately will result in a better planet for us all to live.  More outside the box thinkers equals better technologies, medical, innovation, etc… One well known blogger said “Google’s stature and the United States’ increasingly vocal stance on Internet freedom could not easily be ignored. Google’s pulling out, he said, would ’set a bad example for the business climate in China and make a joke of the government claims of a free Internet.’
    * The second round of the NFL Playoffs should be exciting this weekend as many of the best quarterbacks take the field.  Big yardage quarterbacks.  Peyton Manning.  Drew Brees.  Kurt Warner.  Enjoy the joy and anticipation of heightened competition.

Negatives:

    * Fool in the Shower perhaps with the government’s taxing of the banks?  They are attacking the banks and creating ever more stipulations after many laws have already been put in place.  They have pulled in the reigns, with some of the changes being quite positive, while others and future legalities could be over the top, long-term careless and scalding.  JPMorgan and Bank of America stand to pay $1.5 billion each.  Over the course of the next decade, fees could amount to $90 billion.
    * The destruction of a 7.0 Earthquake is fully dramatized when located in one of the poorest countries of the world.  It is a tragedy.  The US will be sending $100M in aid.  “Former President Bill Clinton, who serves as the U.N. special envoy to Haiti, called on people around the world to donate money to relief organizations or the U.N.  ‘We do not have the logistical or organizational capacity right now to handle a lot of things, even if we need those things,’ he said. ‘What we need now is food, water, supplies for first aid and shelter.’”  Be sure to visit the site listed above if you want to help. 
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GET INVOLVED
Local:

Food for Thought
Where: Mahakankala Buddhist Ctr.  22 W Mission St, Santa Barbara
When: Friday, January 15th.  6:30pm - 8pm
Cost: Not Available
Why:  Something completely different.   “A brief teaching and meditation, followed by a meal with like-minded friends.”  You are encouraged to bring a dish or drink to share (appetizer, entree, dessert, or drink…”  563.6000
For other fun ideas, go to www.lovemikana.com

Live and Be Well,

Jeff Bochsler

2010.  “Twenty-ten”!  We are living in the future.  3-D movies.  Soon to be 3-D TVs.  Spacecrafts that can carry pedestrians.  Video cameras that can recognize movements and hand gestures, permitting the user to compete in video games, snap pictures, or image and relocate them onto computers.  Book readers that can hold 1500 books in the palm of your hand.  Camera cell phones that can recognize your location and its historical significance.   It is exciting.  If all used correctly, our life will be more interactive and expansive. 

This technology boom involves us all in a rapid transition of lifestyle.  Our old ways of being are challenged.  We are all now accustom to email, the internet, and flat screen TV’s, but that which is ahead reminds us we ought to prepare ourselves for another wave of changes and new learnings.

I suggest having fun with it.  Those using iPhones have exemplified this emotional state.  Often you hear them say, “The phone functionality is the worst part about it.  But I will never go back.  It is too much fun.”

While this grand transition occurs, there is a granular transition occurring with the new year.  New Years and birthdays seem to always warp time into a tangible realm.  You actually feel time in these moments.  You act off these feelings.  Resolutions are the result.

Based off our Market Street’s “November Resolution”, you are surely two months ahead of the game.  Hopefully, the holidays amplified your desire to continue with these resolutions and may have even broadened your ideas of what they might look like.

My resolution for the Market Street Report in 2009 was to infuse creativity into our minds, promote ideas of opportunity amidst a grim and stressful business landscape, and to extrapolate tried and true methods from prominent figures.

In 2010, I plan to compound this spirit and knowledge.  We’ll include two further success factors into our scope.  Minds with Mike Towbes has me focused on encouraging detail.  Make yourself a success by doing the little things with great care.  Put your head down and get to work, consistently.  Second, a book I just finished by Bill Bryson, A Brief History of Nearly Everything, has reminded me how unlikely it is that we, as a human race, even exist.  Whether you are a believer in God or not, there are consistently great opportunities to find yourself in awe of the world and universe.  This view will have us analyzing work and life from a 30,000 foot level, through small and big reminders of gratefulness and awe.

Are you ready for the personal transition?  To take it best in stride, be sure to reflect on what transition means.  Remember, “All transitions are composed of (1) an ending, (2) a neutral zone, (3) a new beginning.” -William Bridges, Transitions - Making Sense of Life’s Changes.

Unsure where to start?  The end is where you start.  2009, in this case.
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PLAN
Catalyst for Thought - MINDS Lunches.  Within the coming two weeks emails will go out announcing the availability of tickets to intimate, 10 person lunches with Paul Orfalea, founder of Kinkos, and Jim Eiting, past CEO and now Chairman of Midmark, a $300m medical device company and author of the recently released book, Focus for Success.  Neither will you want to miss and both will sell out fast.  Register at www.CatalystSB.org to ensure you receive the email.
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LEARN
Buzzword: Dirty Float
“Also known as a ‘managed float.’  A system of floating exchange rates in which the government or the country’s central bank occasionally intervenes to change the direction of the value of the country’s currency. In most instances, the intervention aspect of a dirty float system is meant to act as a buffer against an external economic shock before its effects become truly disruptive to the domestic economy.

For example, country X may find that some hedge fund is speculating that its currency will depreciate substantially, thus the hedge fund is starting to short massive amounts of country X’s currency. Because country X uses a dirty float system, the government decides to take swift action and buy back a large amount of its currency in order to limit the amount of devaluation caused by the hedge fund.

A dirty float system isn’t considered to be a true floating exchange rate because, theoretically, true floating rate systems don’t allow for intervention. “  -Investopedia.com

  Six Points to Ponder:

   1. Happy New Year.  The Markets welcomed all happily into the New Year with strong results out of the gates.   - The Dow is trading  at 10,573, S&P 500 at 1137 and the Nasdaq stands at 2301.  Oil is up over $10 since last month, $83/bbl.
   2. Cars Sell;  Clothes Hang; Homes Settle.   Toyota and Ford had US Sales up 15% in December compared to a year ago. Clothing sales hung down in December, selling less than a year ago. Home-Sales were down 16% month over month, but up 15.5% over one year ago.
   3. Google attempts to eat Apple at CES.  While sports fans get amped up over March Madness, the week of the CES (Consumer Electronics Show) in Vegas, the world’s largest, brings purpose to a techie’s year.  Google didn’t disappoint with its Nexus One cell phone that looks to compete with Apple’s iPhone.
   4. Obesity Meets Cigs in the Middle, at Disease.   Over the last fifteen years the number of US smokers has declined by 18% while obesity has climbed 85%.  As a result, obesity is competing for the leading cause of disease and deaths in this country.  Conditioning Specialists begins it’s Biggest Winner competition today.  $1000 to the winners.  Sign up at www.conditioningspecialists.com
   5. Santa Barbara’s Cybersitter Sues China.  Local Santa Barbara software company filed a $2.2Bn lawsuit against the Chinese government and two Chinese companies for copy infringement.
   6. Bowl’s Horns.  With the remaining two undefeated NFL teams losing over the last few weeks, all sports aficionados happily shifted their attention to the college ranks.  No game will be more watched than tonight’s National Championship game at the Rose Bowl in Pasadena.  The Texas Longhorns compete against the Heisman led Alabama Crimson Tide.

Positives:

    * Most years, January’s Market performance is a strong indicator of how we can expect the Markets to act the remainder of the year.  We’ve come out of the gates solidly.  Investors have heard all the horror stories.  No longer are they living under hysteria, selling everything around them when negative news hits.  This doesn’t mean they aren’t cautious with their decisions, it only means big, dramatic sustainable drops seem much less likely than one year ago.  Stability is important heading into more foreclosure and commercial lending head winds.   There are also broad concerns over inflation.
    * The main buzz coming out of this year’s CES is Google’s superphone, the many new touch screen devices, miniature internet devices and tablets.  Apple’s iPhone has spurred creativity and huge demand for portable connectivity.  Combine this experience with the recent surge in book readers and you have many vying for the hand-held / reader computer space.  Those that benefit most from this competition are us customers.  Lower prices, better quality, and more options.  While Avatar in 3-D has consumed movie conversations, Sony and others unveiled 3-D televisions for the home.  Yeah, your HD Flat screen is almost outdated.
    * Southern hospitality has over taken Pasadena, California.  Texans and Alabamans in SoCal.  Might we learn a few things?  One can only dream in Hollywood.

Negatives:

    * Clothing companies were were unwilling to cut prices as they did in ’08.  Clothing sales felt the affects, falling 1.8%. Department stores as a whole were down 2.3%.  The silver lining for investors is profits are expected to be up over 2008 because of these fewer discounts.
    * Home sales may have been down month over month, yet they were still up 15% over November 2008.  Buyers are out in full bloom.  They want to capitalize on the homebuyer credits, low interest rates, and low home prices.  This year should offer a great opportunity for buyers.
    * WebMD.com - “Because of the marked increase in the proportion of obese people, obesity has become an equal, if not greater contributor to the burden of disease than smoking,” write researcher Haomiao Jia, PhD, of Columbia University, and colleagues. “Such data are essential in setting targets for reducing modifiable health risks and eliminating health disparities.”
    * China, despite its continued growth and economic importance, still has huge copyright infringement issues.
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GET INVOLVED
Local:

Kids Helping Kids Benefit
Where: The Grenada
When: Friday, January 8th
Cost: $25 - $65
Why:  It is entirely student run.  It raises money for the Unity Shoppe and Five for Fighting is playing.
For other fun ideas, go to www.lovemikana.com

Live and Be Well,

Jeff Bochsler

Consistent.  Focused.  Methodical.  Analytical.  Alert.

Warm.  Charming.  Gracious.  Patient.

Experienced.  Educated.  Wise.

Solid.  Supportive.

Grandpa.

On a cold Santa Barbara winter Thursday, Michael “Mike” Towbes, nestled into his University Club chair, at the end of a beautifully decorated table, and warmed twelve of our hearts and minds.

He storied us through the “why” and the “how” a man arrives to 80 years old consistently stating, with great confidence, “retirement is not in my agenda.”

He looks to be a prime candidate for the “I’m going to live until I’m 150″ Club.  Most people scoff at this proposal for it doesn’t sound to them at all fun, easy, or entertaining.   But aren’t we ones to claim life is too short?  Isn’t it odd that we wouldn’t want it to be a bit longer?  Might Mike be proving the masses wrong in how amazing life can continue compounding greatness upon itself?

A gentle, often quiet, man that has built living space for over 6,000 families, continues to walk inspired.  A gracious man that manages 1.6 million square feet of commercial space and 2,000 residential units, claims to still have work to do.  An analytical man that is sole-owner of a $950 million bank, enough money to bolster creativity, finds alternatives less desirable.  A solid, supportive man that created the “Community Dividend” program which, each year, looks out for its people, dispersing $1 million over 100 non-profits, strolls on believing now is more important than ever to give back to charities and encourage others to do the same.

He still has work to do.   His time allotment breaks down to “15% at the bank, 50% in construction, and 35% for the non-profits.”  He still has things to learn.  “One thing I’ve learned is you never stop learning.”  He has a beautiful wife in which to live more days.  “I told my wife Ann that I promise to take a month off each year with her if I can keep working.” He has children and grandchildren to see grow.  And he has our very own Santa Barbara, a town he helped build, to look out for.  “I’m worried by what type of people would buy the bank or how a new company would come in and treat my tenants.”

Though I’ve never personally met Warren Buffett, Mr. Towbes and he seem quite similar in their character and path to success.  They both find great joy in methodically building and creating, and all that goes into it. 

There is often the debate over whether it is the man/woman or the moment that makes someone great.  Warren and Mike’s lives seem to support the man/woman, his/her choices, his/her consistency.  There doesn’t seem to be just one moment.  There were many.  We may not all become millionaires or billionaires, with great influence, overnight, but neither did they.

Thus, to the American mindset, this demeanor and progress, this all may appear too slow.  Many entrepreneurs hear the sexy stories of being in the right place at the right time.  The actor/model that was walking down the street.  The business man or woman that stumbled across a great idea and was showered cash upon them instantly.  Santa Barbara teaches us “staying power is important” and “reputation is important”.  “You must do the right thing and lead by example.”   This slow, steady pace has reason, just like a grandfather.  He knows what he is doing.  He is quite conscious of his actions, more than a little kid would understand.

It is also important to note, not all was easy for Mike.  He came to Santa Barbara in the late 1950s.  He had heard of opportunities in Santa Maria, and followed them.  For those not local, Santa Maria is not quite the most glamorous way to start. Then, in 1980, he had difficulty selling initial equity in Montecito Bank and Trust.  $1.25 million and no takers.  He and his partner had to pony up the remaining bill.  And most difficult of all to him, he and his partner, and longtime mentor, had to go separate ways when realized Mike was wanting to work a lot harder than Eli.  Eli was older and in a different place in life.  There he was sitting at a desk alone.  No one was there to bounce ideas off of.  No partner.  It’s lonely at the top.  This is life.

It was quite refreshing to sit back and hear a story that is more practical, more basic, but full of wisdom.

Just as my grandpa shares with me stories of his life, Mike did the same for our room of twelve.  I walked away wanting to call him, not “Mike” as he requested, but Grandpa Towbes of Santa Barbara.  “Grandpa” in the most endearing and respectful way.  For he has consistently looked after Santa Barbara, a town that people from all over the globe choose to call home.

He makes sure we don’t forget the arts and the underprivileged.  He reminds us to stay disciplined and work hard.  He reminds us it is often more important to stay out of trouble, or bad deals, than miss good ones.  He makes sure that we don’t forget to “do the right thing.”  Because isn’t that what a grandpa is suppose to do?
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PLAN  Hanukkah is upon us.  Christmas is 9 days away.  Kwanzaa is 10 days off.  And the New Year is 17 days from now.  Happy Holidays!
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LEARN
Buzzword: January Effect
“A general increase in stock prices during the month of January. This rally is generally attributed to an increase in buying, which follows the drop in price that typically happens in December when investors, seeking to create tax losses to offset capital gains, prompt a sell-off.

The January effect is said to affect small caps more than mid or large caps. This historical trend, however, has been less pronounced in recent years because the markets have adjusted for it. Another reason the January effect is now considered less important is that more people are using tax-sheltered retirement plans and therefore have no reason to sell at the end of the year for a tax loss. “  -Investopedia.com

  Six Points to Ponder:

   1. Healthy Holiday.  The Markets are up this week.   - The Dow is trading  at 10,441, S&P 500 at 1109 and the Nasdaq stands at 2206.  Oil is up slightly to $72/bbl.
   2. Flat Fed.  The Federal Fund Rate was held at its current state of between 0% - .25%.  This marks the 12th consecutive month rates have remained at this base level.  Home Equity Lines of Credit and other personal loans will remain flat.
   3. Greek No Longer Gods.  The Greek economy is on the brink of losing its Euro attachment due to fear of national bankruptcy.  Its rating was lowered to BBB.
   4. Prices and Permits.   Consumer prices were up .4% in November.  New home starts were up slightly from October as well, 2.1%.  But even more encouraging is the 6% increase in permits granted.  All are good short term signs for the US.
   5. Greasy Keyboards. Come January, McDonald’s will be offering free Wi-Fi to customers.  The intent is to challenge Starbuck’s and the coffee market.
   6. Sports Lull.  Aside from the Colts and Saints still undefeated, between now and the first of the year, there are few monumental sports events.  A couple bowl games important to specific regions and baseball trades will make headlines.

Positives:

    * Chairman Bernanke and his team kept to their word today keeping interest rates low.  Despite speculation about hyper-inflation, the Fed continues to show their belief in low interest rates supporting us out of this recession.  Changing this mentality will take a strong consumer confidence level.  They can’t afford to put pressure on the economy’s back before it has  nearly healed.
    * The markets performing well over the last week is a little bit of surprise, as noted in this week’s Buzzword and investors typically taking profits off the table.  It may indicate a couple things.  First, there are no true profits realized.  Or second, people are reluctant to switch any of their current market positions.  There is still great conservatism out there when making stock moves.
    * Consumer prices are up 1.8 percent on the year.  Under 2% is ideal conditions.  The slack in the economy is keeping inflation at bay despite the excess liquidity being pumped in to stabilize things.  This is good news given many speculating about hyper-inflation and great risks to our economic well being.  Builders finding a bit more confidence in the markets also gives hope to our future progress in real estate.

Negatives:

    * I love the spread of free Wi-Fi, but I do have a tough time believing McDonald’s environment will pull people away from Starbuck’s or any of its other competitors.  Coffee shops have a warm environment, welcoming to work.  McDonald’s has cold benches and chairs, bright colors, and greasy fixing.  No thanks.  …unless I’m traveling abroad… (see last week’s MSR if you don’t get this joke).
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GET INVOLVED
Local:

REST
Where: Wherever
When: This Weekend
Cost: $0
Why:   Your families deserve a rested and healthy you.  Despite all the events and holiday shopping needing to take place, make an extra effort to find moments of rest, healthy living, and healthy eating.  Maybe a run or trip to farmer’s market will aid in such efforts.
For other fun ideas, go to www.lovemikana.com

Live and Be Well,

Jeff Bochsler

Maybe you weren’t entirely hungry, or possibly you’re a vegetarian.  Your craving will undoubtedly be directed toward their soft-serve, plain vanilla ice cream.

The charming hilarity of this craving is you rarely, if ever, eat McDonald’s in the states.

Psychologically there are many possibilities for why you decide to enter and order.  You might be seeking refuge from local, hard to stomach food.  Perhaps travel brings out the child in you, and you ate McDonald’s for special occasions growing up.  Or conceivably, you love McDonald’s, would eat McDonald’s every day, but society plays on your conscience.  You choose not to eat McDonald’s in the states because you choose not to look like one that makes unhealthy choices.  Then again, you could be one to just appreciate the feeling of habitually eating healthy food, and a physical vacation allows you to take a vacation from disciplined eating.

Whatever your reasoning, you are the person Ray Kroc was imagining when franchising his business.  For in this moment, you are a person relating to past experiences that wants a familiar, consistent experience.

There is great sophistication in this model.

Franchise models are based on standards.  With standards comes the ability to ensure consistency.  With consistency you are able to monitor quality.  Having a consistently quality product then allows you to replicate and capitalize on economies of scale.

Franchises aren’t new to any of us, however Monday I learned of a new spin on franchising that is being used to positively impact the poorest 2 billion in the world.

I attended a talk put on by The Eleos Foundation, a Santa Barbara based foundation that focuses on sustainable market based solutions in the areas of health and education in the developing world.  In other terms, they invest in organizations that have figured out how to serve the poorest of the poor and still make a profit, thus allowing them to scale out the model to many communities.

One such organization, The Healthstore Foundation, is led by CEO Gunther Faber, a recently retired executive from GlaxoSmithKline.  As Vice President GSK, Sub-Saharan Africa, he traveled to every country in Africa.

Mr. Faber shared with us his belief in why the franchise model, in this space known as Micro-Franchising, is the best way to ensure a healthier Africa.

A nurse is the franchisee, aka the owner, of the local shop.  She has medicines in her shop to treat preventable diseases (which kill 70% - 90% of Africans).  She is supported and trained by the umbrella foundation.  She is able to profit as a small business owner and give back.

Dollars and cents have created the largest barrier to serving Africa.  Currently, the model allows them to provide treatment for $2.40/person, less than a cup of coffee, with an ultimate goal of $1/person.  This is workable. 

Might this micro-franchising have staying power?  I believe so.  It resembles in many ways microfinance, empowering the locals in innovation and trade.  As we see with microfinance, micro-franchising should influence not only health, but education and culture. It puts money in the pockets of the locals who know best what is needed for their children and development.

It is the tweaking of a tried and true model.  And, though McDonald’s missed projections for the most recent quarter, we can be quite confident of micro-franchising and its basic health services success.

Can you think of a twist on a proven model that will have long term positive impacts?
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Congratulations to all those that completed the Inaugural Santa Barbara International Marathon this past weekend!
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LEARN
Buzzword: RevPar
“Revenue Per Available Room- A performance metric in the hotel industry, which is calculated by multiplying a hotel’s average daily room rate (ADR) by its occupancy rate. It may also be calculated by dividing a hotel’s total guestroom revenue by the room count and the number of days in the period being measured.

Keep in mind that RevPAR does not take into account revenue from other hotel services, such as restaurants, spas, golf courses, marinas, casinos etc.”  -Investopedia.com

  Six Points to Ponder:

   1. Holiday Hangover.  The Markets are off slightly this week.  Lower trading volumes and world market volatilities play a role.   - The Dow is trading  at 10,279, S&P 500 at 1088 and the Nasdaq stands at 2167.  Oil is down $7 since last week, $70/bbl.
   2. Job Line Steps Back.  The unemployment rate dropped from 10.2% to 10%.  After two years of unemployment growth, the line in November took a small step backwards, seeing a few leave the line.  Job creation, when?
   3. Bank of America Increases Freedom.  Bank of America took back their colors and announced they would be paying back the $45Bn TARP debt.  Repayment of debt can be be quite liberating.
   4. WhiteKnightTwo SS2.   Richard Bronson and Virgin Galactic continued their rapid pursuits of privatized space travel with their unveiling of WhiteKnightTwo.
   5. Google Goggles. Google announced a new application called “Goggles” which will allow you to search what you see via your smart phone.  Snap a photo and search details surrounding the image, the history, the location, etc…
   6. Bowling for Dollars.  Saturday the Alabama Crimson Tide washed away the Florida Gators title hopes with an impressive victory.  Meanwhile the Texas Longhorns hooked the other spot for the National Championship game.  Both universities stand to make huge dollars.  $18M per conference!

Positives:

    * Chairman Bernanke spoke yesterday about the Fed’s plans to keep rates low into 2010.  The markets reacted negatively to the remarks.  Wall Street doesn’t like the reality of Fed Interest Rates remaining low for the foreseeable future as it signifies a slow and weakened economy.  The positive of these low rates is in the housing sector.  If you own and can afford your home, or rent and want to buy a home, you benefit.  Low rates continue to drive the housing market toward stability and affordability.  Rates are at historic lows.  Paired with lowering home prices in many sectors and tranches, affordability continues its growth.
    * I’m not ready to declare a .2% decline in unemployment as a victory, but let’s look at it as a small, short term victory which gives more hope to families moving through the holiday season.
    * Paying back the TARP money will give Bank of America more freedom in making decisions.  The government doesn’t know what is best for the banks long-term ability to provide value.
    * Inspiring innovation continues to happen.  Space travel is making every attempt to be apart of our daily lives in the next century.  Are you on board?  Then again you could be wandering the streets with your new Google Goggles witnessing dimensions you’ve never seen. 

Negatives:

    * We’re keeping things all positive this week.  The holiday party season has fallen upon us.  Let’s keep our conversations in the positive .
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GET INVOLVED
Local:

Ugly Sweaters for Lives
Where: The Neighborhood
When: Saturday, December 12th.  8pm
Cost: $5 Suggested Donation.  $15 gift.
Why:   A group of Santa Barbara Lifeguards will be returning to Ecuador in February for Carnaval.  The beaches will be sardined with people and heavily in need of competent lifeguards.  Their efforts saved lives last year.  This year will be no different.
How: In an ugly sweater.
For other fun ideas, go to www.lovemikana.com

Eat and Be Well,

Jeff Bochsler

This week’s focus on innovation and opportunity centers in on gift cards: a world that we have all come to love and hate.

As a gifter, there is no easier way to ensure the recipient gets what they want.   There are only two decisions to make — location and price. Pottery Barn or Restoration Hardware?  $50 or $100?

As a recipient, grandma’s taste of what sweater you’ll be wearing over the next four frigid months of winter might be just slightly different than your fashionable taste.  The gift card has been a way of solving such generation gaps.

Adam Smith would pat you on the back for gifting in such a manner.  Free market.  The one that knows best of their needs is the individual.

But what happens if grandma thinks you will like a sweater from Sears and you wear nothing but the finest Lululemon?  Or, you are like me, and you are walking down State Street, meander into Barnes and Noble, find a book you want, then realize you have a gift card at home to cover the entire cost.  Now you are a little angry because this is the third time you’ve bought a book at Barnes and Noble while your gift card has been on the shelf at home.

Oh, but wait.  The fourth time you remember your card.  The card value, $25.  The book value, including tax, $22.50.  Excellent.  Entire cost is covered.  But what about the $2.50 remaining?  You could buy a bookmark with feather, strings and a dream quote or leave money on the table.  Tough choice.

Might there be a better way?

These businesses sure hope not.  They are make a killing on gift cards for doing nothing.  In 2007, $97 billion worth of gift cards were purchased.  It is estimated that 2 - 10% of these sales go unused.  That means retailers profit $9.7 billion in one year of gift card sales.  No product was made.  No product was sold.  Just a plastic card that 10% of the time gets shoved away in some drawer, along with many others.

Pain.  This is where ingenuity and opportunity come in.  Cue Plastic Jungle.  http://www.PlasticJungle.com

Plastic Jungle allows you to buy, trade, and cash in on gift cards.  That Sears card grandma gave you?  Yeah, you can trade it or get cash for it.  How about a small remaining balance? Cash it in.

The use of this site might not lead to millionaire status, but it will sure have you looking better and saving more.  …you may want to include them on your list of things for which you’re grateful.  Happy Holidays!
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LEARN
Buzzword: David Hasselhoff Index
“A stock index comprised of companies associated with actor David Hasselhoff.  Investors might correlate the popularity of David with increased sales surrounding his related products.  Firms involved with Hasselhoff endorsements, advertising, movies or productions are included in the index.

Compnaies included in the index include General Electric, which is the parent company of NBC in which Hasselhoff stars on America’s Got Talent.  Firms in this index generally show consistent growth due to the ‘Don’t Hassle the Hoff’ Factor.”  -Investopedia.com

  Six Points to Ponder:

   1. Four Fs Flat.  The Markets are flat coming off a short week stuffed with friends, family, football and food.   - The Dow is trading  at 10,455, S&P 500 at 1108 and the Nasdaq stands at 2188.  Oil is level at $77/bbl.
   2. Sustainability Stagnation.  Private sector job cuts were down, but not as much as projected.  The economic recovery continues to appear on its way, but rather slowly.
   3. 30,000 Soldier Surge.  President Obama announced today we’ll be taking aggressive steps over the next 18 months to end the Taliban pursuits in Afghanistan.
   4. Australia Says No to Cap-and-Trade.  An attempt to be one of the first countries to adopt a “cap-and-trade” system to lower green house gas emissions failed by narrow margins.  The leading opponent said they should wait to adopt until America does so.
   5. California Tax Deflation. Come January, for the first time in 30 years, California will allow property tax bills to reflect property deflation.  Homeowners cheer, but schools lament.
   6. Two pounded and one took a beating.  The Santa Clara Broncos dominated the UCSB Gauchos, in Men’s Basketball.  The New Orleans Saints weren’t a very gentile host to the long-standing throne bearers, New England Patriots.  And Tiger Woods  woke up in a food coma daze, or was it?

Positives:

    * Consistency.  Going into the holidays, consistency of the markets is much better than seeing your portfolio dwindle.  Consistency should allow you to budget properly.  Lowering job cuts will give you more confidence in your near term future and, thus, ability to plan.
    * The WCC Men’s Basketball conference is proving to be the most surprising division of the year.  Portland walloped UCLA then won a respectable tournament.  Gonzaga nearly brought down the number two team in the nation Michigan State, then later won a solid tournament in Maui.  Now Santa Clara made UCSB, previously undefeated, look like a high school team.  Go Broncos.
    * The Saints and Colts continue rolling.  Both remain undefeated heading into the home stretch of the NFL season.  Drew Brees is playing out of his mind.   No longer are they the “aints”, they’re god’s team, the “Saints”.

Negatives:

    * I’m indifferent to sending more troops.  I can see the positives and negatives.  I give this one a negative for the sole reason of the first deployment of the 30,000 troops will begin this month.  They will be leaving their families behind during the holidays.   Be grateful.
    * Cap-and-Trade would offer many great benefits to the Australia.  They stand to be affected more than most countries by global warming.  It appears politics played the biggest role in it not passing rather than economic reasoning.  The idea behind it is giving a set number of credits for pollution.  If a company needs more credits, they have to buy them.  In buying them, they are faced with the decision of whether the extra pollution is worth the extra expense.  As demand grows, prices are driven higher.  The ultimate belief by Libertarians and most economists, is this is the best system to incentive businesses to limit their pollution.
    * It was a sad day hearing anything negative could surround Tiger Woods.  It is a good reminder that he is just as human, outside the golf course, as any of us.

GET INVOLVED
Local:

Santa Barbara International Marathon and Expo.  This weekend!
Where: The Expo is at SBCC.  Race Start is 1 mile West of Home Depot in Goleta.
When: Expo - Saturday, December 5th. 9am - 6pm.  Race - Sunday. 8am.
Cost: Expo is free.  Race is $130
Why:   Marathon Expos always have discounted athletic attire.  Buy holiday gifts.  Come visit me at booth 311.  And the marathon race days are always full of energy and excitement.
For other fun ideas, go to www.lovemikana.com

Live and Be Well,

Jeff Bochsler