[Homestead] Cash production, was The Piggy Bank is empty

clanSkeen sgian at planetc.com
Tue Sep 28 17:46:06 EDT 2004

> I have never recommended Florida and doubt that I ever will. The list of
> negatives is long. If your parents need warmth, suggest they investigate
> Arizona soon.

I wonder about the *need* warmth thing.   People adapt.   My parents are
from the mountains of SW Virginia and grew up hard and lean.  They are both
77 and both in very good health and strength.  But like everyone else I've
known, once they took up residence in a warmer place, their blood 'thinned'.
They feel miserably cold at 68 degrees now of days although their sibs (who
are older) who live around here do fine puttering about when it's in the
30's.  Because of the pervasive use of air conditioning, it seems to me the
range of temps they tolerate has narrowed.   I guess I'll see when I'm 77.
It reminds me of the incident in Rober Louis Stevenson's 'Kidnapped' where
David and Uncle Ebenezer come into the room of Captain Hoseason:

As soon as we came to the inn, Ransome led us up the stair to a small room,
with a bed in it, and heated like an oven by a great fire of coal.
"Captain Hoseason," returned my uncle, "you keep your room unco hot."

"It's a habit I have, Mr. Balfour," said the skipper. "I'm a cold-rife man
by my nature; I have a cold blood, sir. There's neither fur, nor flannel --
no, sir, nor hot rum, will warm up what they call the temperature. Sir, it's
the same with most men that have been carbonadoed, as they call it, in the
tropic seas."

> I hope you are always able to do so.

The thing, of course, is that I won't.  Unless I keel over some day in the
hayfield or in the woodlot or they find me with hoe in hand in the garden or
some such.   But if I encumber the earth long enough, there will be a time
when I can't earn money.  It's my aim to make that time short.  My favorite
luthier is 80 years old this year and there's a violin maker in the area who
is still active at 94.

> I'm still waiting for the alternative to investing in the stock market
> and/or real estate. Neither is perfect. But what is better?

That's right, I didn't actually answer the question.   Only to say that me
thinks it has no answer.  I'm not sure about the premise that what we
nay-sayers point out is not an answer until we come up with an alternative.
On a financial talkshow I caught one day when driving the caller was asking
the investment guru, "My geezerdom investments were earning 20% in mutual
funds and now they are earning 3%.  I want to know what to put my money in
when I take it out of mutual funds so that I can continue to earn 20%."
When the guru opined that there was nothing, the caller said he hadn't
answered the question.  The idea that the 20% as a fluke of the times and it
wasn't going to happen any more could not be considered. What I mean is,
just because an alternative isn't forthcoming, it doesn't mean the question
hasn't been answered.

The point was that real estate and stocks may well be the *best* alternative
to achieve the restated goal, but they are none the less risky enough and
unreliable.  'Best' doesn't necessarily mean it's a good thing, it's just
the best.

But the alternative would be this, says I,

1) Cultivate your relationships with family and community.   It might be
that during that 6% of your life there will be a household that will welcome
a nodding old geezer and even have useful things for you to do.

2)  Invest some money in something very, very stable.  Like treasury
instruments.  The interest is low but everything else will disappear first
before they do.

3)  Keep your needs and desires modest, moreso as you grow older, so that
whatever assets there are, they will go farther.

4)  Work toward the part of your life when you absolutely can't earn any
money being as short as possible.


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