Terra Incogito

This morning I get a panicky phone call from a property manager regarding a property I am about to list. “The alarm company called and the power went off yesterday, and I called the power company and they said there was a fire!”

So I headed down to the property, and of course there was no fire, but the power lines from the pole to the house were missing. Really. The overhead wires that someone would have to have a bucket truck or something to cut loose, they were gone. And the gate to the yard was unlatched. I know copper is a popular target right now, but really?

So I called the property manager and told her the wires were missing. She called the power company back and they told her, oh, no, the problem is a bad circuit breaker. Right. I had looked pretty carefully and I knew there was no power to the meter, so circuit breaker or no, the power was not there BECAUSE THERE WERE NO WIRES!!!!

So I offered to call the power company myself and talk with them. I spent about 20 minutes talking to a customer service person who 1) refused to look up the trouble ticket the property manager had generated and 2) informed me that the power was off due to a customer request. Really? So I finally asked for the supervisor, and he actually (after 5 minutes on hold and another 5 minutes while he looked it up) knew sort of what happened. A fire? Oh, no, that is just the box we check at the top of the form and it actually says “Fire / Equipment Problem”. Then he proceeded to tell me that on the last visit the technician determined that the wires were frayed and needed replacing, so they sent a letter to the account holder (who at that time was a tenant who was moving out) letting them know that this work was going to happen, and when the tech was out to replace the wires he noted that the service disconnect breaker was in need of replacement. I said, “But there are no wires from the pole to the house!” He said his tech had replaced them not an hour ago.

Great, so in the meantime, this house is in an area that has experienced some vandalism (hence my assumption that the wires had been stolen), and the alarm system has died. Were they going to be responsible for this? No, they had notified the account holder….

So I have the alarm company out running an extension cord from the neighbor’s house to power the alarm…and it is Friday December 21.

Just back from my annual trek to Palm Springs to help out with Tony Robbins’ Date With Destiny, a 6 day long seminar  designed to help us discover the values and rules we live by, and install more empowering ones. There is a whole day on relationships, which is worth the price of admission all by itself. I highly recommend this seminar, if you are not living your life at a high level.

As a part of the leadership track at the seminar, we get to have some extra information, mostly from other leaders, but some from Tony as well. This year, something that had an impact on me was a discussion about the difference between coaches and mentors. In simple terms, a mentor has usually been where you want to go, and can help you through the steps and provide valuable insight. A coach, on the other hand, usually has not been where you want to go, and cannot help you with your business or goals, but instead can help you with your attitudes, with who you might need to become to reach your goals, how to manage your time and your state better, and similar. If you adhere to Mr. Robbins’ principals, psychology is 80% of your success, while mechanics is a mere 20%. So it is more likely that a coach can be useful, as compared to a mentor.

At the seminar this year, a group of us were waiting for some other folks to arrive, and the group leader was asking for someone with a talent or skill to demonstrate or talk about, while we waited for them to arrive. On a silly whim, I offered to demonstrate a very special skill called a “cartwheel.” Now I was just joking around, but as it happens, I am uniquely qualified to teach this skill, as I only learned it when I was more than 30 years old. Why is that important?

When we teach gymnastics, we are usually teaching pretty young kids, maybe 8ish to 15 years old. The younger ones can pick up skills (like a cartwheel) very easily, all you need to is demonstrate it a couple times and they will get it. Sure, there are some little nuances and some style choices that usually need tweaking, but pretty much a little kid can see and copy a simple gymnastics skill. So mostly there is no need to describe the detailed mechanics.

Not so much for adults. If you never were very athletic and never really got into dance or anything like that, and you are more than 6 feet tall and weigh upwards of 240 pounds, then just copying someone doing a cartwheel really does not work. Now comes the real rub — most coaches do not actually know how to perform the skills they coach. The people who taught me to do a cartwheel (and then a front handspring and then a back extension roll and ultimately a whole floor routine complete with back handsprings and flips) did not know how to do them. Sure, they _could_ do them, and demonstrated them ad nauseum, but they were speechless when asked to describe the technique step by step.

So I watched carefully, and read books, and slowly figured out the important elements of various skills. I can tell you that at over 30 and not being in the best shape, psychology was well more than 80% of these skills. Know that one of my coaches was a national champion gymnast, two were Olympic medalists (a long time ago), and one was head of a major university’s gymnastics program and a top gymnast in his own right. And these folks, since they had been doing this stuff since they were able to crawl, really has no idea what was required to make a technique work.

There are several really important things required when teaching an adult to do a cartwheel. First, it is vital to draw a line on the floor so we know where to put our hands and feet. Most coaches get this one right. Then, it is important to know that the trick starts with your shoulders square to the line (not sideways), and that it ends the same way, square. Most coaches know this, too. Next, the trick goes through the handstand position in the middle, and it needs to be a nice, straight handstand. About 1/3 of coaches teach this.

Finally, when you go to put your hands on the floor at the start of the trick, you must put your hands as far in front of you as is reasonably comfortable. Put them too close to your feet, and you don’t develop the power needed. Most coaches know about where hands should go, but most do not know why.

A back extension roll is harder. This is a trick where you do a backwards summersault, and when upside down, pop up into a handstand. I have yet to meet a coach who really understands how this trick really works. I was told that I didn’t have enough upper body strength, that it was timing, that I just needed to do it over and over until I figured it out… lots of advice, all bad. I had one coach perform the trick in front of me about 20 times until I noticed something: As he popped up into a handstand, his hands actually left the ground. I know he was strong, but there is no way he was THAT strong. Clearly the energy was not coming from his “upper body strength”. And indeed, the secret to the trick is that the power comes from your legs, it is what gymnasts call a kip, a way of kicking your feet out to generate momentum that pulls your entire body in the direction your feet are going. As soon as I realized what was happening, I nailed the technique. It is very easy, and it is not about timing, although timing is important; and it is not about upper body strength, although, again, it can help. The trick comes from the legs.

So as I was teaching a bunch of life coaches how to do a cartwheel, what came to me was that even though a mentor may have been where you want to go, they may not have any idea how they got there; rather than it being a learned skill, it is innate; or, they have simply done it so many times that they no longer know why, or even how, they do some of the things they do. This is particularly interesting in the realm of NLP, where one of the things we do is find someone getting the result we want, and then model them so we can also get the result. How can we model someone if they themselves are unsure of exactly how they get their result?

This whole discussion has been on my mind lately, because one of the things I have personally been working on at these events is how to increase my Presence. You know how sometimes you meet someone, and they just have this … presence about them? Most of the senior volunteers at these events have that. And they just “do” it somehow, and they can’t really explain it; it just shows up one day. And just like a gymnastics coach, they know what it looks like, and they can give you some tips about it, but they can’t really explain how they do it. Sure, there are elements of body language, of attitude, and other things, but they can’t tell you the “secret”. It is something we each must discover for ourselves.

And, I think many areas of life are this way. What makes the difference between a top salesman and an average one? Sure, it is skill, but beyond skill there is … something. I’m still not sure if it can really be taught. For now, I’m pretty happy, because I figured out the Presence thing. But I can’t explain how I do it.

–PLH

A couple years ago I went to a seminar where the main speaker was a guy named Chet Holmes, who just recently passed away. He was Charlie Munger’s marketing guy for a long time, and was sharing his marketing acumen with us.

One of the things he spoke about with passion was the idea that most marketers talk about marketing tactics, some about marketing strategies. And he said that the strategist would beat out the tactician every time. I have been thinking about that, and working to implement some of those ideas in my business.

I recently had a [political] discussion with some friends, and votes for at least 3 candidates were present. One of the things I said, was that in our present system, the only candidates with a chance to win were the two front runners — so why would you vote for a 3rd party? In a close race, it is a wasted vote. At least that is my attitude. Sure, I would love to see one of the other guys win, but it just is not possible. Not as bas as the ’92 election where Perot got 18% and helped Clinton win, the 3rd parties will have far less than that this time, it looks like.

So is it possible that in ’92 it was a Clinton strategy to get voter who preferred the Republican candidate over him, to vote for Perot instead? Playing on people’s, perhaps near-sighted, desire to elect the person they thought was best but who could not possibly win? Is voting for who you really want to win, when there is no possible way they can, silly?  I’m not sure. But I do think that if you vote that way, it is not a strategic decision.

In another class I took some time ago, we talked about how most people live at “effect” rather than at “cause”. What does this mean? Some people react to what happens to them. If you get burned by the stove and jump back and do nothing else, you are at effect. If you realize the stove is hot and either turn it off or get a hotpad and complete your task, more likely you are at cause. So when I was thinking about tactics and strategy, I thought about being at cause and at effect also. Seems like for the most part, we use tactics when we are at effect and strategies when we are at cause.

One place this shoes up is in trying to lose weight. People who are dieting (and I think we have all done this from time to time) fail because they are at effect, and are employing a tactic rather than a strategy. A weight loss strategy might be composed of lots of tactics, like going to the gym, or eating right, or running – but without an underlying strategy that keeps us on course, the tactics are rarely applied in a way that results in what we want. Similarly, if I get up in the morning and there are fresh donuts, I am at effect because I eat a donut, and I am not thinking about being at cause because I want the donut NOW to satisfy the carb addiction. Once I have eaten it, I know it was bad, that I was at effect, and being at cause, I throw the box away (another tactic which results in my wife yelling at me but furthers my cause of weight loss).

So back to the politics. Thinking about liberalism and conservatism — affirmative action can place a student in a program for which he is not qualified, in order to “give them a chance”. However, because they are not qualified, they fail, leading to a worse problem that they might have endured staying out of the program. Getting them in the program was a tactic, not a strategy. A strategy might have been to have tutors and mentors work with them through the program to insure a good outcome, albeit an expensive one.

It just seems to me that many of the responses we see from a liberal thinking electorate is a result of tactics without thinking about the long term strategy. And this isn’t just a democrat problem, all politicians tend to have a short term view — until the next election. We need to get away from this and generate long term goals and plans (20 year, 30 year) and get away from tactics designed to get them re-elected. Term limits seem to be one way of doing this. As a politician, if you know you can’t be re-elected, where do you focus? Hopefully a little farther out. Maybe you start thinking about the strategies you can put in place rather than the tactics you can use to get re-elected. But maybe you think about what you can do that will benefit you after you leave office?

Starting with FDR in particular, liberals seem to be more tactic driven, to be more at effect, than being an at-cause strategist. Maybe not. What do you think?

My system has been commissioned for about 10 days now. Today I watched it pretty closely to see what it was doing. The most power it produced was about 8500 watts, at the peak of the day. This is in line with my design goals, so I’m pretty happy about it. I’m expecting closer to 10,000 watts in late June, but even if it is only 9,000 that’s OK with me.

The system is producing about 26.5 kwh per day when it is sunny, and is more than my well and pump require. My wife ran the washer and dryer lots today, so I think we had a slight deficit.

Right now the house is heated with a propane furnace that was installed 10 years ago. It is working fine, but I’d like to convert it to a dual fuel heat pump / propane system, as most of the time the heat pump will do the job (along with the hydronic solar I am adding later this year). I might move the existing furnace over to provide heat for the hangar. Seems better than selling or trading it, it works just fine.

In my research, I have determined that propane is worth about 92,000 BTU per gallon, and electricity is about 3,413 BTU per kwh. The furnaces of the style I need are about 80% efficient or a little less, while the heat pumps are about 200% efficient (heat pumps move heat rather than generating heat). So for, say, a million BTU of heat, it takes about 13.5 gallons of propane or 146 kwh. My current heater is a 100,000 BTU heater, and it seems to run about 15-20% of the time to keep the house warm if I am here; but most of my use is keeping the house warm enough to not freeze, which takes lots less. So let’s say a million BTU will last me 5 days. I’m generating more than 50 kwh a day, so in 5 days I might make 250 kwh, and the heater will use 146 kwh in the same time. Sounds pretty good to me! Of course, if it is overcast, stormy, and cold, then the heat pump and solar won’t work as well, but this is not a big problem in Arizona.

A typical winter will use about 250 gallons of propane, or $800-$900 worth. If I cut that to $100, then I am saving $750 a year, and swapping out the heater will pay for itself in about 7-8 years or so. And of course when I get the hydronics in, it will be even better.

The web box to monitor the system has arrived but is not set up yet. I’ll post a link to look at the actual production when it is installed.

–PLH

This goes along with a previous post I wrote about attitudes we have in America, and how only a change in those attitudes can lead us back to the greatness this nation once embraced. But I digress…

Today I was doing some work on a house I am flipping. (Yes, you can still buy flips in Phoenix but the margins are tight). While I was there, I got a phone call. I am in the process of foreclosing on a property. I bought a non-performing note from a lender, had several visits with the debtor, who basically agreed to sign a deed in lieu so I would not have to foreclose, then proceeded to miss the next 3 appointments that we scheduled to take care of the paperwork. I would rather have done the DIL, as it is cheaper for me, and does not impact the debtor’s credit as much, but that is another facet of this deal.

The property I am foreclosing is occupied by someone who claims they have permission to be there, rent free. There is no written lease, and they are not making any payments (but they do have water and power …) Frankly, I’d rather the property was occupied anyway. So while I was working on my flip, my phone rings, and it is the tenant / squatter. He says “I just got a notice of foreclosure posted on the door!! What does this mean????”

So I spent a few minutes and explained about what was happening, and told him that he can stay until the property changes hands; either I will get it back at the auction if no one meets the opening bid, or someone else will buy it from me. I haven’t decided where to set the credit bid yet (the amount I am willing to bid for the property, which is effectively the opening bid amount), because I’m not sure whether I want the property or not. I know I want it for what I paid for the note, plus the foreclosure cost, because I can sell it for more than that — just not sure I want a long term rental property and tenants and … … … but Maybe.

In my conversation with this person, they informed me that they had been there 3 years. And that they had not paid any rent, ever. I asked if they thought this was fair. “Well, probably not, but you know, after a while, you just get this attitude that it is your place and you sort of have a right to it and heck why should I work and pay someone else rent?” Does this attitude sound familiar?

I told this person, “You know, more than for me, but for yourself, you need to change that mindset — I mean, if you are working, contributing your time and energy to helping someone and creating, and then you can get paid for it, be productive, wouldn’t that feel better than just hanging around?” And they admitted that indeed, it would be better — that they were a little scared about the mental place in which they found themselves.

Then they wanted to know when they would have to leave. I said, “If you get a job and are willing to pay rent, you can stay there as long as you want. Otherwise, the eviction process will probably start in January. Of course, someone might offer you some cash to just leave without being evicted.”

Probably the wrong thing to say. Now they are waiting for someone to show up with some cash so they can leave. Then we talked about rent. The comps for the area are anywhere from 750-950 a month. “Have you SEEN this place? It is a wreck! It needs EVERYTHING!” they said. “You just told me you have been living there rent free for 3 years. And you are not working, so you have time on your hands, right? Why haven’t you taken a little care of the place and fixed it up?”  ”Because it ISN’T MINE!” they answered. Whooooeeeeee….

Seriously, folks, we need to change some attitudes.

–PLH

My system got commissioned today. It is winter, so while I was there I looked at the production rates. At the peak of the day, it was making more than 8,000 watts, which is pretty nice. I was hoping for more, as it is a 12,750 watt system. However, as I mentioned, to avoid wind loading problems, the panels were mounted flat to the roof, and this (over the year) costs about 10%.

The difference between STC and PTC on the panels is part of the deal. What is that? Solar panels are rated with standard conditions, or STC. This is where the panels are supposed to be 245 watts. But the real world performance is PTC, which for these panels, is about 217 watts. So rather than 12,750 watts, the real world is closer to 11,300 watts. Knock another 10% off that, and I should see a little over 10,000 watts on a nice summer day, not considering inverter losses and such, which might cost another 5%. So if I see 10,000 watts in the summer and 8,000 watts in the winter (at the peak of the day) I think I’ll be happy.

Next week they will be installing the web monitoring equipment, and when they do I will post some graphs of what the system is doing, and see if I can extrapolate a year’s production.

–PLH

I live in Scottsdale. One day, many years ago, on a really hot day, I grabbed the mail out of my mailbox and rather than throwing away all the junk mail, I read them. One of the ads was a postcard for lots that were available in Overgaard, about an hour East of Payson.

I went up there and looked at the lots. It was 115 in Phoenix, and humid. It was about 70 and raining in Overgaard. I was sold before I got more than a few feet onto the development.

A few years later, I built a home there, and then added an airplane hangar (this after a particularly nasty hail storm and stories from my airplane mechanic about the fun of replacing all the airplane skins on another customer’s plane.

Our place in Overgaard is a wonderful getaway, and my main regret is that we just don’t get up there often enough. Right after we finished building, I mean the very next month, we had the big fires, the Rodeo-Chedesky fire and others. When that happened, I installed a well and then a sprinkler system so I could keep the trees from dying of drought and bark beetles. Then I found out how much power it takes to pump an 1800 foot well!

And… I burn a pretty substantial amount of propane each year, just keeping the house above freezing. I don’t heat the hangar, just have some heat tape on critical water systems.

Come the real estate crash and now the impending debt crisis, I started thinking about what I could do to be more independent. If I could put in a large enough solar system to pump the well, that would cover most of my needs. The well has a 30 amp breaker on a 240v circuit, so I’m betting it needs around 7000 watts.

When I first started looking at solar systems, APS had a $3 per watt incentive, and my utility in Overgaard had about a $1 a watt incentive. Then, a year later, APS reduced their incentive substantially, and with competition in solar panels, the prices fell. And — my utility increased their incentive to $3 a watt!

I researched solar companies last January, and signed a contract for a solar system in February. Last month, 8 months later, the company returned my deposit and said they would be unable to perform. What!!!! I was a little concerned about losing the $3 incentive, so I called another company I was aware of, located closer to Overgaard and with knowledge of dealing with my utility. Literally 3 weeks later the entire system was installed and passed the initial inspection.

The system I have installed now is a 13,000 watt system, although I expect max production to be in the area of 10,000 watts, for various reasons, especially in the winter. This should be plenty to pump the well. But there are other issues. To get the incentive, I had to opt for a “grid tie” system, which means that the solar system puts excess power back into the power grid if you are not using all of it. The drawback is that if the grid goes down (ie. there is a power outage) then the solar system is also shut off and you have no power. Tens of thousands of dollars of equipment sitting there, useless.

The answer, which is not very satisfactory, is that you have to spend another 5k-10k to set up a battery based inverter that becomes “the grid”. Then, the “grid tie” system sees the battery based system and starts generating power. I’m not sure of all the particular technical reasons for creating a system that only works if the grid is there, but I smell a politician involved, because surely no competent engineer would design such a system by choice. Sort of like designing a car that won’t run unless it is being towed by a bus. Really?

I’m waiting on the final inspection before my system will go live, and I will share my experiences with my bills, the power company, and seeing about changing the system so it will run whether the grid is there or not. In the meantime, I’m looking forward to very low power bills for the foreseeable future, and much lower propane use (although I am implementing a solar heating system as well).

–PLH

I have been watching the Republican and Democratic conventions. I won’t say “with interest” because it is really more “with disdain”. I don’t much like either of the most likely candidates. Why? Well… mostly because I think the process that someone has to go through, to be capable of getting elected, makes sure that they are unfit to hold the position.

I’m pretty much of a fiscal conservative and a social libertarian. What does this mean? I didn’t really know what to call myself, because I like ideas from all the parties. And depending on which site you visit to see which candidate you align with the most, you can get all sorts of different answers. Recently while trolling facebook, I ran across a term I had not heard before: Minarchist. It describes what I think pretty well. That we need minimal government. Check out the Wiki for Minarchist for an explanation.

This fits with my ideas on health care and the inaffordable health care act. I had some pretty deep conversations on facebook while this was being debated. One of my favorite quotes was from Pelosi, who said “We have to pass it to see what is in it.” Regardless of your views on any topic, anyone with this attitude, who is in a position of great responsibility, needs a new job. I don’t sign contracts or agreements without reading _and_ understanding them to the best of my ability. My job depends on it. To have a highly paid public servant make this comment was … just mind blowing. In the private sector she would have been fired on the spot. Of course there was no public outcry from her constituents.

In terms of health care, we had some really spirited discussions. And, while I, and most of my family is in good health, and in a position to afford health insurance should they choose, I had a few friends who have problems, and do not have the money to care for themselves. I feel for them. And, I asked them some questions to try to understand, from their point of view, about this legislation. Most of them thought that, without some sort of help from the government, they, or a family member, would die, or suffer greatly.

So in general I had a conversation like this: “So do you think access to health care, or access to housing, or access to food is most important?” Usually they would say health care, until I asked what if housing cost $20,000 a month. Then it was housing… similar response about food.

If you think about it, what this means is, since people can rent an apartment for $500 a month, and they can get a meal for free due to churches and charities, or even eat at a fast food place for $5 a meal, the problem is NOT related to health insurance, the problem is related to the cost of health care. We don’t buy housing insurance, and we don’t buy food insurance (there may be some esoteric exceptions). But we but health insurance. The government would have you believe (based on the supreme court arguments) that at some point every person will need access to the health care system, and I would argue that at some point every person needs to eat and live in a house.

What if McDonald’s opened some clinics where you could get a checkup for $10 and get most simple things treated for $20? What prevents this? The fact is, that operating a fast food franchise requires lots of very specific business knowledge, but minimum wage employees deliver the product. How is this different from a doctor’s office where one specialized person has all the knowledge, and (potentially) minimum wage employees can deliver the product? One way. Government interference. Our government is so far inserted up into the business of the medical profession that there is no possible hope of reducing costs.

So, you say, yes, but fast food restaurants can’t kill you. They can, if they serve bad food. But this also destroys their business so they are very careful about it. Doctors kill more people than guns, accidentally, each year. So government oversight is NOT WORKING. Part of why I am a Minarchist.

The Obama administration has promulgated so many new regulations and laws in the last four years, that I am not sure it is even possible to comply with them all. And it isn’t just Obama, but previous administrations, the senate, and the house — The TSA has made air travel painful, without significantly increasing safety; the Patriot act has infringed on the constitutional rights of Americans, but without any real success; the expansion of the powers of the EPA, FDA, and other agencies serves to create enough laws and regulations that it has become impossible to just live our lives without being in violation of _something_. This has to stop. The founders of our nation wrote that laws need to be simply written and understandable. And the power of the federal government was strictly limited. These tenets have been ignored. From it being illegal to grow a garden in your yard in some areas, to being illegal to capture rainwater on your own land, to rules against carrying fingernail clippers on an airplane flight.

This is not the nation I studied about, when I was in grade school. I wonder what the founders would say today?