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Clattering East

Poetry & Polymathy from the Baby Boom's Rear Flank
Poetry
Polymathy
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The author w’ tam o’ shanter in 1978. Photo: Elliot Kirschbaum

Two Fingers for the Major

Had you found yourself traveling west from Towson on I-695, the Baltimore Beltway, in the afternoon of a day in early summer of 1979, you might have caught sight of something that for a moment captured your attention. There on the shoulder of the highway were a man and a boy in full Scottish regalia standing next to a canary yellow 1967 Chevy Camaro, their kilts blowing about in the breeze as traffic whizzed by. You may not have noticed, however, that the two were yelling instructions to another boy, also in a tartan (MacPherson Hunting) lying on his back under the rear of the car attempting to reattach a dangling muffler with a leather belt.

If you have ever wondered what a Scotsman wears under his kilt, this would have been your opportunity to find out, except for one thing. The boy spread-eagle under the car had not a drop of Gael in his blood. That was 17-year-old me just then coming to terms with the knowledge that he was wholly unfamiliar with any aspect of auto repair.

There was, in fact, just one Scot in the party and he only half – his father was Irish. The man’s name was James “Jim” Quigg but to me and the other boy he was known only as Pipe Major or just the Major.

We were on our way home from a marriage celebration where the Major had been hired to pipe the wedding party down the aisle and he had brought two of his junior pipers, me and my buddy Tom Ilmanen, along for the job. By the time we left the party, the Pipe Major was “feeling no pain” as he would have put it so although I had only a learners permit, he wisely let me drive his prized Camaro. As we sped along the beltway, a rusted metal band holding the exhaust pipe in place had chosen that moment to give way and the muffler began dragging along the blacktop, forcing us to pull over.

I was the one who came up with the idea of reattaching it to the car using my belt (three years of engineering high school was not for nothing). However, doing so required puncturing a new hole in the belt using the Major’s ornamental dirk, which turned out to be not just for show but was, in fact, quite sharp.

I was just completing this delicate operation, narrowly avoiding being badly burned on the scalding exhaust pipes when a State Trooper, his curiosity no doubt aroused by the colorful scene, stopped to see if we needed assistance.

I felt a bit uneasy as I saw him pull up behind us. Although it was perfectly legal for me to drive as long as there was a licensed driver in the car, I was not certain if that was the case if that driver were tipsy.

Fortunately, the officer quickly concluded that Her Majesty’s Own Highlanders had the situation well in hand and he departed without so much as a request to see my learner’s permit or a sobriety test for the Major. I piloted the Camaro back to the Major’s house without further mishap.

I never saw my belt again.

Pipe Major James Quigg leading the band at a summer festival in Baltimore in 1978. Photo: Elliot Kirschbaum

A few years before that incident, Tom had appeared at school with an odd double reeded musical instrument. It turned out to be a practice chanter, on which students learn the melodies (if one may call them such) that one plays on the Scottish Highland Bagpipes. I had loved the bagpipes since first hearing them on the radio when I was probably around 8 or 9.

Tom had discovered that a local immigrant from Glasgow, who in his day job taught High School physics, was giving bagpipe lessons on the side – for free! I pestered Tom until he taught me the scale on his chanter and then insisted that he bring me to the Major. I showed off what I had learned from Tom and the Major accepted me as a student on the spot.

Meeting the Major was intimidating. It didn’t help that at first, I didn’t understand a word he said in his thick Scottish burr. But feeling intimidated was short-lived. He was funny, charming, and an incredible storyteller. Every Friday after school, Tom and I would walk over to the Major’s house off Northern Parkway near Roland Park. While the Major would nap (perhaps sleeping off a wee after-work dram), we’d descend to the pine paneled basement with our friend, Greg Cantori, to work on the tunes we’d been learning and to teach each other. Sometime around 6 o’clock we’d be summoned upstairs where Gracie (the Pipe Major’s mother, who had lived with him since she’d come over from Edinburgh a few years after he) served us a simple dinner —usually, boiled hot dogs. Sometimes there would be a reheated chicken pot pie from a box with defrosted potato nuggets. There was always milky tea and a biscuit (cookie).

Around 7:30 the doorbell would begin to ring. Each time it did, Sheona, the giant poodle, would grab a slipper and head to the door with it in her mouth. Every time the door opened behind it would be a friend and fellow piper. Every age, gender, religion, and skin color was represented. The dining room table would fill with chairs and the air with smoke. For those of age (not we young lads and lassies) the whisky and wine flowed freely.

It may not shock you to learn that the Major could imbibe a fair bit on these evenings and Gracie did not approve. When he thought she wasn’t looking, he would hand me his glass and whisper, “Dennis, two fingers for the Major” and I would dutifully slip away from the table and return with the requisite measure from the green bottle in the kitchen.

For the next three hours the Major would tell stories and jokes and teach. He’d teach bagpipes, of course but also elocution, acting, and poetry recitation while the assembled hung on every word and note. He was a masterful piper even after several tumblers of J&B.

Once we played well enough to join the Baltimore City Pipe Band, which he led, the Major lent us bagpipes, uniforms, and everything else we needed. Although most of the band members wore little military style caps, I sported a cheeky green tam o’ shanter when I marched. It featured a large silver ornament inset with an amber glass jewel that seemed to float above my left eye. I liked it very much.

He took us on private jobs too and always split the fee equally with us. Summers home from college the Friday night gatherings continued. He never took a nickel from any of us for lessons, food, or uniforms. Not a penny. Ever.

The Pipe Major never married. He often referred to a girlfriend named Trudy. We never met her. I have no reason to doubt that she existed nor evidence to suggest that she did. He never had any children –besides us.

After college I didn’t return to Baltimore, and I gradually lost touch with the Major though I did stop by to see him from time to time and, when I remembered, dropped him a card on his birthday (Sept 6). A few decades ago, I learned that his mother had passed away. Sheona the poodle died too. Just before I went to Rochester in June of 2015, Greg told me that the Major had moved into an assisted living facility. He was, it seemed, in the early stages of dementia. He and I went to see him and took him to lunch on the campus of the facility. He thoroughly enjoyed the meal knocking back three glasses of wine in quick succession. He had some of the old spark and charm but decades of cigarettes, whisky, and probably just age had taken a toll. He was nearly 80. It was the last time I would see him.

I had thought there would be time for more visits but five years in Rochester with few and short trips home and then Covid, which placed senior facilities off limits and well, time went by. I didn’t get back again. Recently, I learned that he had died.

There is no way of describing the gift this man gave me. I won’t try. He appeared in my life at a critical juncture between the ages of 15 and 18.

I can’t claim to have had a particularly difficult adolescence – no more so than any nerdy teen who struggles to find the place where he belongs. But like many young adults, I lacked form. I needed to know what I could do; who I was.

Jim Quigg believed in me.

That, it turns out, is everything.

PostedMarch 1, 2023
AuthorDennis Kirschbaum
5 CommentsPost a comment

Early arrival. The whole place to herself

Spring Training

Here in the DC megalopolis , this has been one of the mildest winters I can remember. Except for a few days, it hasn’t gotten bitterly cold and there have been many, many warm days. The roads have remained free of salt and most of the time my old leather bomber jacket and a pair of fingerless gloves have been as bundled up as I’ve needed to be. The tank for the oil we heat with wasn’t filled for more than a year and was still nearly half full when the men finally showed up to top it off. (The fact that we keep the house between 57-61F keeps the oil consumption down too.)

Then today, just a few weeks into February, the temperatures soared into the 20s (70s F) and out on my walk, I had to remove my jacket entirely to prevent my radiator from overheating.  The sky is a stunning cerulean and the few clouds float by like cotton candy at the summer fair. In the park, a cherry tree (not me) was in full blossom and a precocious butterfly danced along one of the gravel roads in our town.

When I was a kid, there was also the occasional warm day in February. Those days felt like a miracle. Now they feel slightly ominous as the effects of man-made climate change appear to be accelerating.

Sinister or not, the mild weather has been a boon for our winter training program. We are planning a journey to the southwestern U.S. this spring to, among other things, hike to the bottom of the Grand Canyon. This has been a goal of my (Ironman triathlete) wife for years and I, in a moment of insanity, agreed to go along.

I have done some hiking in my day and so shouldn’t be intimidated by this prospect, but this will be different from anything I’ve done before.

First of all the hike begins with a descent of around 10 miles into the Canyon. That part sounds ok. However, once at the bottom, there are only three ways out again. One is back the way you came ascending 10 miles and climbing more than a mile of elevation along the way. Also since the rim of the Canyon is more than 7,000 feet above sea level, the higher you climb, the thinner the air gets. The more you climb, the harder it gets to continue doing so especially for those of us who commonly dwell at sea-level.

The second way out is on the raft of someone nice enough (and with enough room) to pick up hitchhikers (unlikely).

Finally, your loved ones can hire a cowboy at the Phantom Ranch to throw your dead body over a mule and haul you back up.

To make our trek a bit easier, we’re hoping to spread the hike over a few days.

  •  Day one: hike halfway down and camp overnight.

  • Day two: hike the rest of the way to the bottom dine at the ranch (see above) and hike back up to camp.

  • Day three: back to the rim.

Of course, this means each of us schlepping a 10-15kg pack with food, stove, fuel, sleeping bags and a tent down and back up again!

I say this is what we hope to do if permitted by the United States Park Service. You see there are so many people that want to do exactly this, there are limits on how many are allowed to camp in the canyon overnight. You literally must win the lottery to do so.

Unfortunately, we didn’t. So, we plan to show up each morning for a week or so, hoping that a spot has freed up and that the rangers will take pity on the holders of a lifetime senior access pass (knowing we may never be back again!) and allow us the privilege of sleeping on the cold ground in the Canyon.

Cherry blossoms busting loose. Groundhog be damned!

Thanks to the mild winter here, we have been able to train on the Appalachian Trail or in other nearby parks most weekends. Our hikes range from 12-20km (6-13 miles). Last week we swapped our day packs for the bigger packs we will use in the Canyon. I felt pretty good after the hike (the homemade pizza and red wine helped) but the terrain, altitude, and elevation changes here in the east are so different, that I am not sure how I will feel when the boots hit the trail in earnest.  

Assuming I survive this adventure, further (more mellow) hikes await in Zion, Bryce, and Joshua Tree National Parks and perhaps a few fine meals (seders?) in the L.A. conurbation before we once again steer VanGo!’s bonnet toward the place we call, for lack of a better word, home.

Departure is still some weeks away, meanwhile, I’ll enjoy this winter of our discontent made glorious summer by these sons of greenhouse gas emitters… wait I gotta go. Clarence comes.

PostedFebruary 23, 2023
AuthorDennis Kirschbaum
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“Time is your friend; Impulse is your enemy.” John C. Bogle 1929-1919

Mr. Bogle’s Relentless Rules

Those of you who are even sporadic readers of this blog probably know that I am an admirer of the late John C. “Jack” Bogle, the man who started The Vanguard Group investment firm and is considered to be the “father” of index investing. Here is right up there with Steve Jobs and Benjamin Franklin in my pantheon of genius. I recently saw an interview with Bogle where he summarized his entire investment philosophy in Ten Rules. After watching the whole thing, it seems to me that it could be further distilled into just seven, which also happen to encapsulate everything I have come to believe about investing. Here they are.

1. Time is your friend.

The most powerful tool in investing is the power of compounding. We all know that if you lend your money out to a company or an institution (as you do when you put your money in a savings account, or buy a CD or a bond) the institution will eventually return your money to you plus interest. Compounding happens when you reinvest the principle plus the interest that you earned. For example, let’s say you invest $1,000 for 30 years at 7% interest. Without compounding you’ll earn $2,100 ($70/year for 30 years). At the end of 30 years you will have $3,100.

Now consider the same investment but with the earnings reinvested (compounded). At the end of 30 years you will have $7,612.26! That’s around 2 and a half times more!

Modest amounts invested grow tremendously when the return is compounded.  But the key element is time. This is why is it is so vital to start saving early for retirement. It allows you to do a lot with a little. You don’t need to save huge amounts as long as you start early enough. In fact, how much you need to save each month, each year, becomes a simple math problem. I’ve talked about how to calculate this in the past, but if you need a refresher, feel free to contact me for how to run this simple calculation.

Over long periods (decades) the stock market has always outperformed the bond market. In fact, in recent years bonds have had negative real returns, so to achieve goals you’ll almost certainly need to favor stocks over bonds in your portfolio. How much? If you are young you may want to be as much as 80% stocks to 20% bonds and cash. When I started saving for retirement (around age 27) I was 100% stocks for those funds. I didn’t own any bonds of “fixed income” investments at all until I was in my 50s. Today I am 80% stocks and 20% bonds and cash. I am willing to give up some growth to reduce volatility. At least that is the theory.

But which stocks to buy, how do you pick the winners? You don’t.

2. Own the entire market.

Anyone who tells you that they know what to buy is lying. When I was young I thought I was smart enough to beat the market. Fortunately, I had the humility to only try with small amounts of “play money.” Guess what? I was wrong! Every individual stock I ever bought underperformed the market as a whole during the time that I owned it. Every stock except one, and that was just stupid, dumb luck. I bought the stock because I loved the company, not because I thought it would do well. In fact, I expected I’d lose most of my investment. The following year that company released a product that would go on to become one of the most successful in history. So as it happened, I did okay on that one. But only that one!

All investors taken together are going to be just average because for every buyer who is right, there is a seller who is wrong. You are not smarter than everyone. Neither is your money manager. So keep it simple, buy everything. Today this is easily done through a mutual fund that is indexed to the entire market. If the whole market is up 10% this year, your fund will be up 10%. If the market drops 20% (as it did last year) your fund will drop 20%. But over time the market trends upward. It seems contrary to the American ethos to accept average, but average is plenty good enough in the long term. You need own no more that 2-3 funds to capture the entire global stock and bond market. Easy to understand, easy to manage.

3. Impulse is your enemy.

It is natural to want to buy when the market is going up and to want to sell when the market is tanking. You must resist these impulses. If you are working, you must continually keep adding to your investments week in and week out regardless of what the market is doing. The day-to-day gyrations are a distraction. Ideally, don’t even peek at your investments. Bogle suggested shredding the statements without looking at them. Most of us can’t do that, but think in terms of decades. Don’t even think about selling until you are ready to retire.

4. Kill the costs.

The biggest drag on your return is costs, and often they are invisible. Here are the biggest costs you face.

Money manager fees. This is the cost an advisor is charging you to manage your money. Very often these fees are structured as a percent of your assets they are managing. Commonly these range from .75%-1.5%. These fees devastate your return. Because of compounding (see number 1) these fees can cost you hundreds of thousands over the course of your life.

Here is an example. Let’s say you are 30 years old and you begin to invest $10,000 per year until you are 67 (37 years) and your return without fees is 7%. When you turn 67, you’d have $1,603,374.

Now let’s say your advisor skims 1% off the top each year. At 67 you’d have just $1.27 million. And that is before trading costs or other fees they may be incurring. Imagine an accountant who wanted 1 percent of your net worth to do your taxes every year! Or a lawn care person who wanted 1 percent of the value of your house to mow your lawn! You’d think that was insane.

You can’t outsmart what Bogle calls the “relentless rules of humble arithmetic.” If you are paying an advisor 1% that turns into a colossal amount of cash.

Not to say an advisor can’t be helpful, but if you need one find one that charges a flat fee. $300-$500 per year doesn’t seem unreasonable to me (and there are plenty of flat fee advisors out there) but you may find that you only need to meet with them once or twice and then every decade or so. If you are a client of an investment firm like Fidelity or Schwab, they will provide you with an advisor for free but I have found that what they know varies widely and they may suggest products that generate fees for their firms or themselves. Be sure to ask questions and be clear about what you want. If you can, try to get one that is a certified financial planner but that too is no guarantee of competence.

If you are paying someone a percent of assets under management, you are being hoodwinked. There is no nice way to say it.

Other sources of costs are trading fees, mutual fund expense charges, or front end load fees. But if you are purchasing a straightforward index fund from Fidelity, Schwab, or Vanguard, you are probably going to pay an expense charge of .05% or less. That is very small. Index funds have low costs because they are just following the market. They don’t need to pay someone to make decisions about what to buy and sell. A computer algorithm can match the index for a very low cost and that is all you need.

So kill the costs. Keep the savings for yourself.

5. There is no escaping risk.

If 2021 taught us anything it is that owning cash is not risk free. With inflation running at 8-9 percent, cash is losing value every day. With bonds returning 4-5%, their real return (after inflation) is negative too. Stocks at least have a chance of keeping pace with inflation because corporate earnings increase along with inflation (generally speaking). Yes, in the short term stocks are more volatile than cash, but we don’t care about the short term do we? (See number 1.)

Obviously, I am referring to long-term investments here, like retirement funds. If you are saving to buy a house in the next few years or the education of a child just a few years from college, volatility is to be avoided. Holding cash, bonds, or CDs makes perfect sense to provide for these near expenses.

6. Don’t fight the last war.

It probably goes without saying at this point but you shouldn’t be adjusting your investments based on what happened this year or last or what you think might happen next. Making changes because inflation was low or high last year won’t work. This year will be different. Last year’s best mutual fund probably won’t be this year’s winner. What goes up, must come down and vice versa. Stick with your plan and stay the course.

7. Stay humble and remember reversion to the mean.

The market goes up and the market goes down but by definition it must always return to the mean. Once you accept that you are guaranteed to be average (as long as you buy the whole market and hold if forever), you will sleep better. But do remember although the American stock market has returned roughly 12% from 1957-2021 there is certainly no guarantee that it will do so in the years to come. Growth of GDP has slowed recently and with it the growth of American stocks. Although you can be assured of being average, you don’t know what average will be. If you plan on a return over 30 years of an average of 6-7 percent on a portfolio of 80-90 percent stocks, you will likely do ok.

Bogle suggests that a reasonable guide to what stocks will do over the next decade is to take the current average dividend yield and add earnings growth which roughly tracks growth in GDP. By this measure he thought in 2019 that the market in next decade might yield 7%. He ignores speculative growth because that cancels itself out over time.

When in doubt (which is always), lower expectations will force you to save more and be more frugal, thus increasing the likelihood that surprises will be good ones. Above all, live beneath your means. Finding yourself able to retire before you planned and having to decide if you want to keep working is a better problem to have then being unable to work as long as you’d planned and not having enough to make ends meet or living a smaller retirement than you’d hoped.

Of course there could be a personal situation (health, divorce), or national, or global events that could drive your return much lower: an economic depression, war, or the collapse of the American Empire. All of these things have precedence in history. Ultimately there is no safe store of value because there is no permanence. But if any of these things happen, there will be many, many people who will be in a similar situation and we will do what humans have always done. We will try to figure it out together. Until then, for my money, the father of index investing knows best.

PostedFebruary 16, 2023
AuthorDennis Kirschbaum
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