Calm Cash

Hi and welcome to Calm Cash. A lot has happened since last week. While our country continues to be plagued by the coronavirus pandemic, an old, insidious plague that has existed since the founding of our country has taken center stage this past week. Of course I’m talking about racial inequality and all the fear, hate, violence, death and unfortunately silence and inactivity that go along with it. The wounds re-open frequently and never heal mainly because most of us do nothing. Maybe out of our own fear about saying the wrong thing. So instead of being silent…let’s talk. First, let’s talk about the landscape. The George Floyd video was heartbreaking and I was unable to watch it all. It was so affecting because of the length, dialogue and horror of the video. At the memorials, protests and rallies you see the names of past victims too but we might be missing the full context of the problem when it comes to profiling and police brutality. In 2019, 1004 citizens were fatally shot by the police.  The rate of fatal shootings in Black Americans was much higher than any other ethnicity. There were 996 people shot in 2018 and so far 429 civilians have been killed by police in 2020. For every George Floyd or Michael Brown in Ferguson there are 100s of other people, Black men and women, who have died at the hands of the police whose names we will never know or hear. This has to stop. Next, I want to speak very bluntly about something that bothers me and has to change for us to advance the dialogue. If someone says “Black Lives Matter” and the word you hear out of someone’s mouth in response is “Well”…and then something that follows like “of course ALL lives matter”. We need to call that person out and help them understand how that sounds to a Black person. At best it is tone deaf and at worse it is highly offensive. It discounts and diminishes the focus on the violence and discrimination black individuals face every day. I’ve heard a bunch of analogies to help explain this but the one that constantly resonates to me is one I heard a few years ago when a Black man was explaining Black Lives Matter to a group. He said: I have a son and a daughter and if someone says to me “do you love your daughter?” and my response is “I love all my kids” then my daughter I’m pretty sure would think “you don’t love me. If you do, why wouldn’t you just say it.” Everyone already knows All lives matter, we are past it and it doesn’t need to be said. Speaking of bubbles, let’s talk about how we get out of the ones we are in when it comes to information and education on issues that matter. The term used is “filter bubble” and this is the phenomenon of being isolated from information that differs from your preferred viewpoints. You would think in 2020 that sharing information and educating yourself on the facts would be easier than any time in history. But ironically it isn’t because of technology…mostly social media. It is easy to get locked into these thought and idea filter bubbles because we curate our friends and connections online, can easily mute or block the people and opinions we don’t want to see and then AI and machine learning serve up content, ads and information that reinforce our context from the algorithms running Google, Facebook, Twitter and news sources. This has been happening for years and we have learned this behavior. There is a news app called Read Across the Aisle whose goal is to burst your filter bubble. Another good solution is AllSides. This is a news aggregator app that will take a topic and bring together 3 well-written articles – one each from the left, center and right sources – to give broader coverage to a story. It is a good way to expand your news and information. --- Send in a voice message: https://anchor.fm/calmcash/message

May is an important month to me. I got married in May, I started the job I’ve been in for over 10 years now in May but May is also important because it is Mental Health Awareness month. I usually release new episodes of the podcast on Sundays and this episode is dropping on May 31st, the last day of Mental Health Awareness month. That is very intentional because we still have a problem as a country when it comes to talking about mental health and we need to think about and discuss mental health for 12 months a year and not just one. Because most of you will listen to this in June, this is a small step but it is something I can do to keep the dialogue going. We aren’t talking enough about what IS mental health, sharing our stories and reducing the stigma around the subject. So today, I’m going to talk a little bit about Mental Health Awareness Month and then tell my story because one of the best ways to de-stigmatize the subject is to shed light on the fact that most of us will deal with some kind of mental health issue in our lives.  So let’s go… --- Send in a voice message: https://anchor.fm/calmcash/message

Our economy is going through lots of change right now as this virus creates significant disruption for people and businesses. Small businesses are really hurting as forced closures and stay at home orders have made it hard for them to stay afloat. This same thing is happening to really large companies. Bankruptcy filings by companies like JCrew, Neiman Marcus, JC Penny, Hertz Rental Cars and Gold’s Gym show that well known brands are not immune to the impacts of the virus and show how our behaviors around eating, shopping, and working out have changed…maybe forever. Certain industries are really getting hit hard. But how do we know what those industries are with data? Well one report that gets lots of attention is the Jobs Report which you’ve probably seen in the news lately telling the bad news around unemployment. Millions of people have lost their jobs or been furloughed because of the virus. But within that report are some really important numbers and indexes that tell us a lot. One of those is the diffusion index which shows which industries are gaining or losing jobs. There are 258 total industries tracked by the index and only 7 industries experienced job growth. Yikes! To put it in numeric terms, in February the diffusion index was 53 but in May it is 4. And that is out of 100 where bigger numbers are good. This shows just how widespread the job loss and impacts are. So this index can help us understand in the short term what industries to avoid potentially investing in like travel (so the airlines) leisure and hospitality companies (which are food services, hotels and even online booking sites), traditional retail stores, transportation, construction and the gaming industry like casinos. It all really makes sense when you think about it. So what industries are still doing well, even thriving in this environment and what themes or narratives can we create to help us invest?  Here are four: 1. Ecommerce  2. Consumer Staples 3. Our New Normal at Home  4. Healthcare  The episode continues by discussing how we check our work, ways to buy these themes, a discussion on cash positions in our portfolio and dollar cost averaging. --- Send in a voice message: https://anchor.fm/calmcash/message

Kicking off a multi-week discussion about investing in a market impacted by COVID.  Topics discussed include: 

- how much money to have in your emergency fund before investing 

- understanding your tolerance for risk 

- different types of investments and the definition of each (stocks, bonds, mutual funds, ETFs) 

- risk spectrum on the investment vehicles

 - understanding time horizon and how important it is to help us balance risks 

- assessing your own money goals for risk and time horizon

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One of the hardest things about this entire situation is the uncertainty of when things will get better and the feeling of powerlessness to do anything about it for yourself or someone you love if you aren’t a healthcare worker or first responder. Well the good news is there are lots of things, some things you can do in as little as 1 minute, you can do to feel better mentally, emotionally and physically and regain some of the perceived powerlessness to influence the situation.

1. Limit how much negative information you take in

2. Sketch out what your day will look like

3. Add play to your day

4. Breathe

5. Use the power of your phone

6. Keep drinking – water that is

7. A clutter free corner

8. Get your zzz’s

9. Make your chores less frustrating

10. Take a Drive

11. Connect to 1 person per day over text, email, video chat, phone or social media

12. Spring Clean your Social Media

13. Remember your mantra

14. Communicate your needs

15. Take quality breaks

15 things is a lot. I hope you can find 2 or 3 of these things and make them work in this coming week. If so, I want to hear about it either through email or on our Instragram @calmcashpodcast. And if you find these helpful, share this episode with a friend or two. Until next week, stay safe and healthy!

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One of the hardest things about this entire situation is the uncertainty of when things will get better and the feeling of powerlessness to do anything about it for yourself or someone you love if you aren’t a healthcare worker or first responder. Well the good news is there are lots of things, some things you can do in as little as 1 minute, you can do to feel better mentally, emotionally and physically and regain some of the perceived powerlessness to influence the situation.

1. Limit how much negative information you take in

2. Sketch out what your day will look like

3. Add play to your day

4. Breathe

5. Use the power of your phone

6. Keep drinking – water that is

7. A clutter free corner

8. Get your zzz’s

9. Make your chores less frustrating

10. Take a Drive

11. Connect to 1 person per day over text, email, video chat, phone or social media

12. Spring Clean your Social Media

13. Remember your mantra

14. Communicate your needs

15. Take quality breaks

15 things is a lot. I hope you can find 2 or 3 of these things and make them work in this coming week. If so, I want to hear about it either through email or on our Instragram @calmcashpodcast. And if you find these helpful, share this episode with a friend or two. Until next week, stay safe and healthy!

--- Send in a voice message: https://anchor.fm/calmcash/message

Robin Sharma has a pretty cool quote about change. It goes “change is hard at first, messy in the middle, and so gorgeous at the end.” I feel like we are still in the middle because things sure feel and seem messy. But I’m hopeful that on the other side of all this we will find something gorgeous. Today we are going to talk about goals and how to create change in your life. Macro Goals: Before we dive into micro goals, let’s first start talking about our big picture goals. In the example earlier, our superstar set a goal to lose 25 pounds in 2020. This is a good goal because it is a SMART goal. SMART is an acronym that stands for: Specific – goal is direct, detailed and meaningful Measurable – trackable and easily quantifiable to identify your progress Attainable – is it in your power to accomplish it with the necessary tools & resources Realistic – within reach and relevant to your life’s purpose Time Based or Time Bound – has a specific, defined period of time These are really important to set yourself up for success. So a goal that isn’t SMART is something like “I want to pay down debt”. Now let’s make that a SMART goal. It would be “I want to reduce my outstanding student loan debt by $5000 before Christmas 2020”. I recommend that you write down your goals, make them SMART and focus on 1 – 3 tops at a time. It allows you to give it your all and take the next step of creating a plan through micro goals or tiny habits to be on your way to success. So now that we have our macro SMART goal, lets get micro: One of the prominent voices helping individuals make positive change happen is Dr. BJ Fogg who is a professor at Stanford University. In his book “Tiny Habits: The Small Changes that Change Everything” Dr. Fogg gives the strategies and research behind creating lasting behavior change to reach your goals. It is all based on taking baby steps and using existing behaviors and routines to jump start our new, positive habits. Dr. Fogg created a behavior change model with a pretty easy to remember equation. It is B=MAP where Behavior is driven by Motivation Ability and a Prompt. Let’s take a closer look at each element: Motivation – high vs. low; primary driver that creates the desire for change; has physical, emotional and social levels or elements as well Ability – hard vs. easy; running a marathon vs. walking for 5 minutes; affordable, feasible, realistic Prompt for the behavior – a trigger or signal to kick off the change; health scare, a loss or a spark of an idea Things that are easy to do in terms of the Ability element require less motivation to do the behavior and create the habit whereas hard things will require more Motivation and potentially multiple Prompts. Regardless of how easy or hard the goal or chance is in front of us, setting micro goals or tiny habits around existing behaviors we do every day or week will help us get ahead. You can create your micro plan around this sentence: “After I _____existing behavior______, I will ______tiny new behavior_______” After I start my morning coffee, I will take my daily vitamin After I check Instagram, I will do 2 minutes of box breathing After I get my paycheck direct deposited, I will put $10 in my emergency fund Take an existing habit (brushing teeth, walking the dog, etc.) and add the tiny behavior. Over time you can expand the tiny habit to get you closer to your overall goal. Dr. Fogg wanted to do more strength training as he got older to boost his physical wellness. So he came up with a tiny habit based on something he does 6 to 8 times a day. His habit started as: After I pee, I will do 2 pushups.  There is one last piece of behavior change that Dr. Fogg says is critical. We have to celebrate ALL of the successes. --- Send in a voice message: https://anchor.fm/calmcash/message

***Bonus Episode***

Ben discusses 3 questions that have been on his mind the past few weeks and how he found answers, information and new ideas in an article by Marc Andreessen titled "It's Time To Build".

Link to full article:  https://a16z.com/2020/04/18/its-time-to-build/

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All the numbers you need to know about how COVID has impacted our money.

The first number today is 26 Million. That is the number of Americans that have filed for unemployment over the past 5 weeks. And I think that is a pretty amazing number when you consider that between November 2009 and January of 2020 where our economy added 22 Million jobs to the payroll. In just 4 weeks during this pandemic, all of those 22 Million added jobs were whipped away and now another 4.5 Million Americans are without work. Going back to the adjectives, what is staggering is just how fast all of this happened. They are projecting the unemployment number will rise to 27 Million or about one million more people from where we are today by the third quarter of this year. That will make the unemployment rate about 14% and just 8 weeks ago in February it was 3.5%. So wow.  What can you do?  Feed your emergency savings, know your resources, update your resume and scan for opportunities just in case.

The next number is $3.7 Trillion. That is the projected federal budget deficit we will see by the end of September. The deficit was only about $1 Trillion in the last 12 months at the end of this March. It doesn’t have to be said but I will anyway, that is so much freaking money and so much debt! A budget deficit just means that our government is spending more money than it is taking in.  What does this mean?  Potentially increased taxes or inflation, or both!  What can you do?  Get a handle on your spending and find ways to supplement your income.  

13% is the next number. This is the increase in fraudulent attempted transactions online by criminals in March 2020. And the 13% is expected to continue to rise the longer the pandemic continues. This number is only counting attempted online account fraud which is a ripe opportunity for bad guys because so many more people are shopping online due to social distancing. What this number does not address is the number of scammers trying to get people’s IRS stimulus payments because we don’t have that number quantified. Phishing scams are also on the rise as are people setting up fake charities and requesting relief and donations. I’m not even going to talk about the number of fake remedies to cure COVID that are blowing up social media. The bottom line is bad times bring out the bad guys who use fear and uncertainty to try to prey on people. So first, be skeptical of phone calls and emails about your IRS payments or orders you may have placed. Make sure you hover your cursor over links in emails before clicking to make sure they don’t have weird web addresses. Additionally, consider changing your passwords to banking institutions and online shopping sites where you store credit card information.

The last number for today is 2021. Specifically second quarter of 2021. This is the estimate for how long it is projected we could be practicing some degree of social distancing in our working and social lives. This was also from the Wall Street Journal and when I read that I was pretty floored. That just seems so long from now but it will be necessary because the experts think that the virus is going to come back again, potentially in several waves over the next one year forcing us to keep our distance like we are doing today.  What can you do about it? I think just be mentally prepared. Maybe we will have windows of time where things get relatively back to normal, but I am preparing to have more stretches of working from home and not being able to see my friends and family in person. And I hate that but we have to deal with this new normal.  Also, know your resources.  Your company may provide mental health resources, sometimes called EAP or provide counseling programs.  If not, check out NAMI for more info on counseling resources available to you and your family.

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First Ben talks about some strategies to regulate emotions, specifically one called Cognitive Reappraisal that helps you change your narrative about the emotions and feelings impacting your life.  Then we cover 4 awesome wines that are unheralded, reasonable priced and definitely drinkable.

Something with Bubbles

Bubbles are good. Bubbles mean it’s a party. And the sound of a cork popping is one of the best sounds out there. The problem is that Champagne can get really expensive or the cheap stuff can leave quite a headache. So what I like to do is go to a different region of Europe that still takes sparking wine with bubbles seriously but without the prestige and price mark up of Champagne France. Some people would say Italy and Prosecco but I like Cava from Spain. The first time I had it was on a family trip we took to Barcelona when I was still in college. The trip was amazing as was the food and wine. I got hooked on Cava and haven’t stopped drinking it since.

The sparkler that I like to drink is Isaac Fernandez ‘Biutiful’ Brut Rose Cava. They do everything like the French do by letting the wine have secondary fermentation in the bottle just like champagne but at only $14 a bottle. The fruit is 100% Garnacha which makes it fruity but crisp. I highly recommend it.

Rose All Day

We love Rose. We loved Rose before it was cool. I give full credit to my wife on that one. There is this awesome seafood restaurant in Austin called Perla’s on South Congress. They have a great patio for people watching and this epic raw bar menu of oysters, crab, shrimp and just generally delicious seafood. We asked for a recommendation for a bottle of wine years ago and the waiter said the Miraval Rose. She totally nailed it and we’ve put it in the rotation since then.

It is French but at $17 a bottle still really reasonable. It is a light pink color in a cool looking bottle but this is all about the taste. It is a little floral with an acidic citrusy finish. It is refreshing on a hot day but drinkable year round.

The White Wine You’ve Never Heard Of

Let’s stay in France because they have been making wine for hundreds of years. They have some epic white wines that are super complex and super expensive made by master wine makers. An unheralded white wine from the Loire Valley is Muscadet (M-U-S-C-A-D-E-T). People don’t know how to say it which will deter people from ordering it or buying it. It is made from this grape called Melon de Borgogne which sounds sweet and gross and probably too similar to muscadine wine which is disgusting.

Columbia Valley Cab

Napa Valley is probably the wine epicenter of the United States. There are movies and documentaries about it and people go out of their way to visit to taste great wine about an hour north of San Francisco. My wife had her bachelorette party there. It was great and I was jealous. The problem with Napa is how popular it is and that can lead to you paying more for the location on the label than the quality of the wine in the bottle. So just like we went to Spain instead of France for sparkling wine, I recommend going to the Columbia Valley instead of Napa for an awesome Cabernet. One that I love is called Substance Cabernet Sauvignon. It is made from 100% Cabernet grapes and you can get a bottle for $13. They even have it at Costco when you are bulk purchasing 300 rolls of toilet paper.

One more tip that I may regret telling you all. There is this great website called Last Bottle. They feature 1 wine per day until it sells out. These guys are based in California and are super connected in the wine scene. It is pretty common to save 30 – 40% off the retail price of the daily wines they feature. I have yet to have a bad wine from Last Bottle

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