From the JoeBurnsBlog

This is a an old quiz, but it got me today while reading Snap Judgement by David Adler.

A baseball bat and ball cost $1.10 in total.  The baseball bat costs $1.00 more than the ball, how much does the ball cost?

Pretty easy, unh?

You can imagine the expression on the face of the seller of a beautiful SF Bay front home in Tiburon, CA when I asked if his $6.9m home had indoor plumbing.  But, that was a common question to ask when I began selling real estate in 1892 and I had simply forgotten that times had changed.  I've been in the biz for a LONG TIME. 

My first deal was actually a buyer representation on a land deal.  Being new to the business, I was willing to accept any client on any deal, so I asked J.M. Donaldson to sign an Agency Disclosure and began the search for 640 acres of agricultural land.  My luck, the government was granting property under the recently passed Homestead Act, and even 3% of zero still equals zero.  With no commission on that deal, I convinced ol' J.M. to scrap the whole farming thing and consider building a single-family residence on a portion of the property and splitting off 500 acres for planned unit development.  Heck, I could resell his SFR for $425 dollars, earning a cool $12.75 ($12.35 after taxes).  I should have rolled my earnings back into the development of the additional land, but who knew?

With my monetary windfall secure in my trouser pockets and the realization that selling real estate was a potential gold mine of big earnings and little hours, I set off for the urban streets of Chicago to focus on farming a neighborhood with doorbell ringing and a direct-ponyexpress campaign.  The problem was once I found a willing seller I had no effective way to connect with the other agents in the area.  In 1908, I was invited to participate with a group of men of my ilk (women were not allowed) to establish an association to unite all agents of real property.  We all got along great, golfing together, going to title company parties, living large on lender kickbacks, it was a roaring period.  Then a couple guys started talking about the stink eye they were getting from their clients about things like misrepresentation, exaggeration, commingling funds and put-it-writing dialogue. It was a real buzz kill on our lucrative careers, but the guys all decided we should adopt this Code of Ethics that protects our neighbors, friends, clients and associates.  We all agreed and even adopted the moniker of Realtor to show our commitment.

The next decade was incredible, we won the big war and the economy was booming. I migrated as far West as the train tracks would go and ended up in the Bay Area.  At the time a fixer in San Francisco was fetching five grand and owners were starting to see double digit appreciation.  The explosion of popular new media like newspapers and radio had us picking up new clients right and left.  I even put a door decal on my Ford.  I couldn't help invest a portion of my commissions into commercial properties and residential rentals.  They were ‘sure things', couldn't miss, the only possible threat had been mitigated with the new seismic building codes established after the big one of '06.

 
Ah, but how I remember that fateful Tuesday morning, I was sitting in Mel's drinking a cup of that new blend by James Folgers when we heard the news on the box, stocks were falling rapidly.  Before, I could roto dial my stock broker and request to sell, my portfolio had been demolished.  Little did I know that my real estate holdings were next in line.  Foreclosures became the talk of the town.  They couldn't build that damn orange bridge to Marin fast enough to offer a jumping pad for washed up speculators.  It didn't really matter if the bank owned it or an individual owned it, the value was rock-bottom.  Why sit in your

property while owners around you bailed to the countryside of Walnut Creek and San Jose.  I promised myself ‘Never Again' would I view real estate as an appreciating asset.  It's only offering was for shelter.

With my retirement plans on hold, I had to rebuild my residential sales business.  With any luck a new war would break out and a whole new host of returning GI's would spark our market.  This chap in NY, Levitt I believe, came up with a great new idea for suburban housing neighborhoods and the craze was to build 500 homogenous properties right next to each other in the middle of nowhere.  The remarkable thing was they could pick whom they wanted, and didn't want, to live there.  Varied pricing, selective lending practices and smoke and mirror disclosure practices gave the developers the power they needed to sell a poorly constructed home at a premium price.  Then that nice, young Catholic president with great hair started the change to all that and entire forests of trees were being decimated to provide enough pulp for the onslaught of disclosure documents to come.  Some people believe that attorneys invented the rolling file cart, but actually it was the real estate listing package that gave cause. 

For each of the last 35 years in this business I have seen a new fad, a new disclosure document and a new property describing adjective.  Title companies have been neutered down to be nothing more than providers of insurance and third party intermediaries.  Prospecting techniques require a logon name and password, more contacts are made at the kid's soccer game than the local pub, 4-door autos are needed to transport open house signs and not clients. 

When I started in real estate we asked if the john was inside or out, if the windows were hinged and if there was dirt or wood under the rug?  Now I need to learn 100 foreign appliance makers, the differences between marble, granite and limestone, the life expectancy of a synthetic roofing shingle, hypoallergenic flooring options, home theater sound qualities and automated home lighting controls. 

When we use to show property we asked for the dog's name, now we ask for the alarm code. We even went as far as suggesting that the 4bd house right next to the elementary school with a built-in swing set, bunk beds and tree fort would be ‘perfect for a family'.  Apparently we were way out of line.

I can't imagine what changes will occur in the next 100+ years; I just know I'll take them in stride and make the best of the times. 

Have you picked out that perfect gift yet?  Oh man, the pressure - something she likes, something practical, something at a discount, something no one else has.  Well, I have your answer for the perfect Christmas Gift.

A Barrel of Light Sweet Crude Oil.   I don't mean a commodity purchase; that would be tacky.  I'm talking an actual 42-gallon, black barrel, stored in your garage for future use. 

What, you think all that talk of ‘alternative energy' is going to make oil obsolete?  No way, gas prices went back down and the sodium-cracker-combustible-engine sailed out the door.  OIL IS KING!!  And now you can afford to buy the Mrs her own SPR (strategic petroleum reserve)  Heck, at $55/barrel, why not buy a few.  Stack them high in the garage, you can leave the Escalade outside this winter; you bought the paint protection option, right? 

Oil was $150, it is now $55, its going to be $150 again this summer.  Why not take advantage of this down market? Your stocks took a dump.  Your home equity left quicker than a Sarah Palin t-shirt at a church rally.  What do you have left to invest in? 

On the morning of the 25^th, when that truck rolls up the driveway and the forklift begins unloading barrels, you will be the envy of husbands up and down the street.  None of their gifts will pay dividends like your Lt Sweet.  Two barrels and a few planks of wood and you have patio furniture.  Four barrels and you have the perfect stand for the camper shell. 

Don't buy the commodity.  I don't trust commodity brokers, who knows what price you're actually selling/buying at and you're always competing with those large trust funds.  Leave the broker out of it; buy the barrel.  I remember when my dad bought my mother General Electric shares one year.  Great gift, practical, couldn't lose, easy to wrap.  Oh, but the look she gave him after she opened that Florsheim shoe box to find the stock certificates; he then wished he had just bought her the chest freezer she had asked for.

Oil, it is the new Diamonds.

(Another tip - I'm filling garbage cans with gas right now.  It ain't going to get any cheaper this summer.  The garage smells of vapors, but I am stockpiling and saving.)

I awoke this morning in our guest bedroom, not completely oblivious to the events that got me here.  I vaguely remember the 1 am clandestine mobilization of my 3yr old daughter and armful of combatant stuffed animals.  We call them ‘lovies', but in the middle of the night when one of them is noticed AWOL by their 3 foot tall commander-in-chief, we call them a nuisance. 

After the invasion, our first mission was to find the troops left behind.  By 1:15 we found ‘Red Hood' the bear and ‘Froggy' and brought them to their new camp between Mommy and Daddy.  At 3 am there must have been some internal conflicts as Daddy took a couple pointed heels to the kidney.  At 3:30, when the sniper elbows were hitting my face, I decided to take refuge in the guest bedroom.  The guest bedroom receives actual guests about 2x a year, the other 363 nights it is there solely as a refuge to embattled Mommies and Daddies.  As I crawled into the quiet, vacant bed I had a final concerning thought, "what if my racing mind takes over and I can't fall back..." 

Next thing I heard was the troop mobilization on my southern flank, "What the...?"   6:47 am!  Oh yeah, Sunday morning - a family time, an introspective time, a relaxing time and a time to watch cartoons. Our guest room also contains the only upstairs TV.  I was soon surrounded by ‘pink bunny', ‘ballerina bunny', ‘gorilla' and the aforementioned ‘Red Hood' and ‘Froggy'.  Their commander had pulled herself up and taken post on the pillow next to me, asking for mechanical assistance with the video equipment. Luckily, my college training kicked in and I was able to enact the TV and Comcast cable box while still in a near-REM state.  I tried to fall back asleep, but just couldn't muster the ability to block out the high-pitched voices of the cartoon characters.  I pulled myself from the bed, kissed my little leader on her forehead and headed downstairs to my first cup of Joe. 

Sunday morning is a great time to be productive; I thought why not do some laundry while the coffee brews.  My only adult ally was able to fall back asleep and I have learned that the remainder of the Sunday is much more pleasant if I show some tactical support early in the day.   As I put the batch of soiled uniforms into the wash basin, I saw it.  Right there in the filter tray, dripping wet and looking worn was the thimble size ‘penguin' that has been missing in action for nearly two weeks.  He must have been in someone's pocket then washed ashore during the last cleaning.  I scooped him up gingerly, looked him over for any major wounds, dried him with a kitchen towel and brought him upstairs to the platoon of other lovies. 

‘Penguin' was always a liability.  Being as small as he is, he was smothered during snuggle time and often fell behind the bed or into precarious locations.  He was drafted through a 25 cent gumball machine at the local family diner and was held in reverence for what he lacked in stature.  "He is so cuuuute", my little one would say to the little one in her outstretched palm.  He was easily transportable and went where she went until that fateful day we learned he was missing. 

As I headed up the stairs, I was already basking in the hero light that would soon shine down.  The moments a father gets to be the hero of the day are infrequent.  In between threatened timeouts, hair-brushing pleads, and finish-your-supper commands, I rarely get to be the one that brings the ear-to-ear grin and admiration-eyes that melt your heart and swell your pride. 

To get full control of her attention, I positioned myself squarely between her vantage point and the TV.  I open up my hand, nearly as wide as my smile, and said, "Look who I found in the washing machine". 

She shrieked with excitement, "PENGUIN!!"  "Daddy, you found him," she said with the smile I had envisioned.  The morning light gleamed through the window and engulfed my image.  I was exalted.  Even the deaf dog heard the excitement and look up with eyes that said, "good work old man". 

I had done it; a day's work completed and it was only 7:30am.  Man, would NFL football be enjoyable today.  I was even sure the Mrs would suggest I watch the 10 o'clock and 1 o'clock games back-to-back, and worry about the pine needles next weekend. 

I slowly backed away, taking in the joy for one final moment, kicked my right toe on the ground in an about-face movement and nearly skipped to the door when the shrilling scream re-inflicted my healing kidney.  "His legs are missing, his legs are missing".    His what?  The quarter-size little made-in-China toy had legs?  What legs?  Are you sure, he had legs? (Asking a 3 and 5/6^thyear old if she was sure about the anatomy of her toy animal is like asking Sarah Palin if she really wants to be VP.  The answer is confusing, but delivered with sharp conviction.)

I stood there shell shocked, not having prepared a contingency plan.  Do I move in or retreat?  Out of nowhere, my second-in-command appeared from the master chamber and quickly silenced the combatant with a plethora of wordy condolences, promises and diversions.  Within seconds the little leader was re-engaged in her television drama, all lovies accounted for and lined up next to her, a child's smoothie in hand and contentment on her face.  I was no more noticeable than the door frame. The dog's head was back down and eyes closed. 

Ah, Sunday morning; the perfect imbalance between ending one week and starting the next.  The only assurance is the newspaper on the front porch and the hot cup of...

"Honey, where do we keep the coffee filters?"