It is time!

If you are a first timer, please read the following pieces first. It will provide you with important background information.
1. Why I created this blog?
2. How am I going to operate this blog?

Fellow Toastmasters and guests;

There were two condos for sale across the street from mine. On July 18, I took a look at one of them and made an offer on the spot. After negotiations, my offer was accepted. Buyer’s remorse overwhelmed me afterward. What if I can’t find a tenant? What if there are uncovered deficiencies? I was nervous, uncertain and even afraid, especially after I learned from a smart investor that I should have lowered the purchase price by another three, four thousand by offering cash. I can get a home equity loan later.

In May and June this year, the market was off significantly. Instead of a solid gain, my portfolio was at the break even point for the year. There were talking heads on the nightly business news convinced there will be a double dip and another recession. I was reminded that the US government had a lot of liabilities, medicaid, medicare and social security, unfunded promises. More taxes are on the horizon. Local government is going to lay off thousands of workers.

I met a pretty lady in my church group. Her name is Kate. She is trying to find a teaching job after getting her license. Kate has tried everywhere and couldn’t find one and now the new school year is starting in one or two weeks. I can feel the anxiety from her voices. She may have to take the substitute teaching position and the pay will be very very low.

I like reading. I got this new book, written by Hank Paulson, from a local library along with many titles dealing with property management, real estate tax laws and do it yourself guides. The former secretary of treasury didn’t use a collaborator. He recounted the crisis in such a clarity that I recommend this book to anyone. It is a 450 page book and I finished it in two settings in two days.

After reliving the painful experiences of the great recession through the regulator’s perspective, I know what topic I should give for an inspiring speech. The doomsayers will always focus on the negatives. Although the past decade was a difficult chapter in our nation’s economic history, it is just one chapter, and there will be many more that are marked by economic gains and rising prosperity if we learn from our mistakes and make the necessary corrections.

I pray for Kate to get a teaching job. But the tight fiscal situation at the school district will give a rare opportunity to the board to cut waste, renegotiate the labor contract, get rid of the ridiculous seniority rules, and refocus on the quality of the education. The key is not to spend more, but to spend where it really counts. And like the school board, the state and local governments across
the nation will have to do the same, stop providing services the private sector can provide more efficiently, stop unsustainable benefits to public workers and streamline all the overlapping bureaucracies. Those will make them stronger.

And yes, the federal government has a lot of unfunded promises. But it also holds a lot of assets understated or not stated at all in its balance sheet. For example, the federal government owns 650 million acres of lands, about 30% of the land area of United States. Lumber, minerals, gas and oil. The government also has rights for all the seashores. Those are tangible. How about the intangibles? How about the most productive labor force, the most flexible and dynamic financial, legal and political system? After successfully tackling the financial reform and health
insurance reform, I believe the current Obama administration has wisdom and prepared to reform the entitlement programs. It is effective and efficient. I support all its moves with sole exception for the immigration reform. But it is for another speech. Those will make our federal government stronger.

And for me. During the last three months, I bought Sanofi, Pfizer, GE, Johnson and Johnson, and Merck. Even after the condo purchase, I still have ample liquidity and a strong balance sheet. As long as the deal is good, I am open for business. I am ready to write a check and my check will clear. I can easily cover the principal and interest, property tax and condo fee. Those make me stronger.

And for you. Now some well maintained, ready to move in properties are selling for less than a fully equipped Corolla. If you have cash under the mattress, or in a checking account earning close to 0 return, you can’t wait. If you sit on the fence, you will miss the boat. Be greedy when fear dominates. Those will make you stronger.

Together, those will make us stronger.

Thank you.

Mr. Toastmaster.