Monday, July 19, 2010

Inspiration From The Land of Oz

I never realized how much Dorothy was right, when she clicked her heels, begging to go back to Kansas. There really is no place like home.

I’ve called Madison, Wis. home for four years now, but you come to realize just how important your real home is. I hadn’t been in Framingham, Mass. since January, and the more I’m away from home, the more refreshing it is to be with the people with whom I grew up. You just can’t substitute home for anything, and new friends can never replace old ones.

What’s been even more inspiring for me has been the energy and excitement that has been radiating from some of my friends over the past few days, energy that I haven’t experienced before in Framingham, energy that can only come from maturity and motivation to succeed in the real world.

I’ve already had some great talks with friends in the mere 103 hours since landing in Massachusetts. Becky Abrahams is psyched about her new job with It seems like she’s in a great spot, earning some valuable experience at a small startup in Needham, Mass.

Missy and Kristy Owens like working for Puma and are talking about moving to the Los Angeles office in the future. To be honest, I never would have expected that out of the homegrown Boston sisters. But I love the mindset; we should all experience as much as we can while we’re still young and damage our livers way too much on the weekends.

Sam Osborn’s got a good actuarial internship in Connecticut. To be honest, I wasn’t worried (not that I necessarily was about anyone else) about her; I knew success loomed in her future a long time ago.

My dad's got the entrepreneurial juices flowing these days, too, which is also awesome. Check out his new venture, which revolves around a 400 horsepower 2000 red Ferrari. Yeah, I whipped it on the Mass Pike last week. No big deal.

What’s really made me pumped over the last 36 hours is the pair of conversations I’ve had with two of my best friends, Danny Sullivan and Justin Martino. Danny just landed his dream job on Friday, a supply chain management gig in Fall River. The kid’s energy, excitement and motivation rival mine, which at this point is pretty difficult to achieve. To be honest, I don’t think even he, nor his mother, for that matter, could have envisioned this four years ago. But the kid’s worked his ass off and deserves everything he gets. No one gave him anything; he earned it all on his own. That shit makes me pumped more than anything in the world.

Of course Justin and I had a two-hour conversation about life, coupled with stogies and a bit of Admiral Nelson’s on the side. Anyone who knows us shouldn’t be surprised about that. But the kid just gets it. His perspective on life is spot on, and that’s coming from someone who’s been to Iraq and has a stint in Afghanistan on the horizon. But expect big things from him when he gets back. And expect us to co-write a book in that general timeframe. You think I’m kidding.

People sometimes speak of Framingham as if it’s a black hole, a place to waste time and underachieve. False. I just gave you multiple examples against that theory. Success flourishes in Framingham!

Dorothy was right. There’s no place like home.

Thursday, July 15, 2010

Does Michael Lewis Motivate You Like He Does Me?

If you’re remotely interested in economics or finance and haven’t read Michael Lewis’s The Big Short, you’re behind in the game. Actually, I’m currently 50 pages from the end on a flight from Minneapolis to Boston, but my mind is forcing me to write this as opposed to finishing reading at the moment. That tends to happen to me. I hear it happens to all prodigies in every facet of geniushood, but I’m not sure.

The Big Short is a phenomenal description of the economic collapse of the past four years, through the eyes of several Wall Street investors who saw the financial Armageddon on the horizon, shorted (bet against) basically the whole market and ended up, well, I guess I’ll find out when I finish the book, but I essentially know the ending. Only one scenario makes sense.

I will warn you that if you don’t have a decent economic/financial background, it does get relatively technical, even though Lewis (hands down the best nonfiction writer of this generation of authors) does make it as easy as possible for the “average” reader to understand. Nevertheless, credit default swaps, collateralized debt obligations (CDOs) and asset-backed securities get a little confusing if you barely understand the principle of an interest rate. Then again, even the CEOs of Goldman Sachs, Morgan Stanley and AIG probably still couldn’t explain to you today what they mean, so it’s not exactly fair to feel stupid while turning the pages utterly confused.

To me, the economic collapse is both terrifying and encouraging at the same time. The main lesson I took from the book is to always do your homework; educate yourself so that you can trust yourself and don’t have to rely on others.

The collapse occurred largely because of a combination of ignorance and greed, but more of the former than the latter, in my mind. Among several others, the bond rating agencies, Moody’s and Standard & Poor’s fucked up. Bad. These two agencies – as far as I understand from the book – mis-rated billions of dollars’ worth of mortgage-backed securities in these CDOs. It’s another language, I know. As Lewis explains it, it’s basically a roulette game, except with odds that would put the casino (in this case, a company like AIG played the role of the casino) out of business after losing just a couple bets.

According to the book, shorting (betting against) these CDOs was the equivalent of a 200:1 bet on something that was almost certain to happen. Lewis describes it as buying multiple claims of fire insurance on a house that was already bursting in flames, all because of these mis-ratings by the agencies. And only a handful of people saw it like that.

The real problem was that the bond traders at firms like Goldman, Morgan Stanley and Citigroup trusted these agencies like Mother Teresa without doing their own homework on the securities in which they were investing. They assumed that the ratings were accurate; and we all know what happens when you assume. Except that these assumptions didn’t just make asses out of them, it ended up costing their firms hundreds of billions of dollars and subsequently, millions of Americans their jobs.

See, what I’ve come to realize is that the U.S. economy is extremely top-heavy. For example, Tom Brady, manager of Bro Haus Hedge Fund, trusts the S&P rating of Camp Cedar CDO, invests in it and loses billions when 10 percent of the houses in the “obligation” default on their mortgages. Smith no longer takes his stretch limo to his Wall Street office in Manhattan and he no longer goes to that steakhouse uptown every other Friday with the boys. Now the limo driver and the server at the steakhouse, middle-class Americans make that much less, so they cut back on their expenditures. And the employees at the places formerly consumed by those two individuals begin to struggle more, and so on; it’s the epitome of the domino effect. In my mind, that’s our economy in a nutshell. Please let me know if you think otherwise – I mean that in the least cocky way possible.

So what this collapse should have taught us is to check, double-check and do your homework before making any financial or business decisions. It’s terrifying because what essentially happened was that the greed and ignorance of money managers and rating agencies in this country led to the collapse of recent past. Because of poor judgment on the part of people like Brady at Bro Haus, hard-working cashiers everywhere lost their jobs, many of whom probably couldn’t spell “collateralized debt obligations.” To me, that’s terrifying and terribly unfair. Well, we’ll call it “unfortunate.”

What we’ve also learned is that people – even some of the most educated and well-paid individuals in the world – make mistakes. Like you and I, they fuck up. But I see other people’s mistakes, ignorance and laziness as personal opportunities for business, not just in the trading world, but for all businesses. A lot of businesses are based off at least one of those three premises. Perhaps it’s just the competitive nature in me (scratch that, that’s definitely what it is) but I see businesses and people who run them all the time and quite frankly, I think I could do a better job than many of them. Or at least I know I have a better work ethic than them and would therefore generate more profits.

That’s essentially what equity trader Steve Eisman did, which is not only refreshing but downright inspiring for hard-workers everywhere. He worked hard, did his homework, lost countless amounts of sleep over seeing a life-changing opportunity, traveled the world seeking smart (and rich) individuals to back him and he made a killing when everyone else thought he was off his fucking rocker. He realized he understood things that almost no one else in the world understood, put his money where his mouth was and said, “I’m the best,” to himself, “fuck what everyone else thinks.” And now he’s billions of dollars richer.

That’s why I play poker. No, playing $1-$2 No Limit Texas Holdem isn’t going to make me billions of dollars wealthier. But I play to win, because I’m confident that I can outplay the other stiffs at the table. And to be honest, I often do.

I played 23 hours of poker at Ho Chunk Casino in Baraboo, Wis. this summer (no, I never made the 45-minute trip alone and yes, I know my grandfather is rolling his eyes at the computer right now). In those 23 hours I made about $400 – and it would have been more like $1,000 if I didn’t lose KK to QQ on the river for a $400 pot. For those of you non-poker players, that’s about a 96 percent chance to win $400 at 1:1 odds. In other words, unless you’re shorting CDOs (apparently), it doesn’t get any better than that. But the queen came and fucked me. That’s poker.

But the point I’m trying to make is that if you do your homework, you know your shit and you’re confident about it, the opportunities out there are endless. That’s how I see it. Many aspects of life aren’t all that different than No Limit Texas Holdem. That’s essentially why I get up every morning – to see how I can better myself and what new challenges lie ahead.

I may never make billions. Odds are, I won’t. But with that mindset, I feel like success lies in my future. And if you think like that, I’m pretty confident that it will for you, too.

But it won’t come easy; it didn’t for Eisman and friends. He put the time and effort in to make his billions. Plus he had the balls to actually pull it off.

Sweat equity, my boy Mark Cuban likes to call it. After reading Lewis’s (the second person I’d like to meet in the world behind Cuban) bestseller, I’m ready to pour out a little sweat equity to begin my professional career five weeks from now. Let me know if it motivates you that way, too.

Tuesday, July 13, 2010

Classless Effort Given By the Artist Formerly Known as 'King'

It’s been five days since the self-proclaimed ‘King’ “decided to take [his] talents to South Beach.” And instead of continuing to voice my opinion on the phone, in bars, walking down the street, on the bus, in my house, on the dock, on the tee, in the fairway and on the green, I’ve decided to shut my mouth, stop arguing and write everything down. And being the retired writer (or perhaps just in hiatus?) that I am, it only makes sense to do so.

Essentially, LeBron James decided to “Bro Out” instead of compete. ESPN’s Bill Simmons may have put it best:

"Michael Jordan would have wanted to kick Dwyane Wade's butt every spring, not play with him. This should be mentioned every day for the rest of LeBron's career. It's also the kryptonite for any "Some day we'll remember LeBron James as the best basketball player ever" argument. We will not. Jordan and Russell were the greatest players of all time. Neither of them would have made the choice that LeBron did. That should tell you something."

It’s true. If LeBron truly wanted to be considered as one of the greatest, he would have stayed in Cleveland and won there. If he truly was “The Chosen One,” as stated in ink on his back, he would have won at least a couple championships there. And if he couldn’t get it done, then he shouldn’t be considered one of the greatest of all-time. It’s as simple as that.

After the nauseating “Decision” (actually I didn’t watch it, thank God) Thursday night, I initially thought that Cavs owner, Dan Gilbert’s letter was an act of sore losership. But after much thought and debate over the last 108 hours or so, I’ve realized that Gilbert’s furiousness toward James is indeed justified.

Let me make one thing clear, however. Before Thursday, James owed nothing to the Cleveland Cavaliers, their fans, the city or the state of Ohio. If he wanted to leave the Cavs for Miami, New York, New Jersey, Chicago, Dallas, wherever it may have been, I had no problem with that. Quite frankly, he did enough for the Cavaliers, making a doormat of a franchise relevant literally on his own, taking them to the NBA Finals with Anderson Varajao as his sidekick. Jordan, Russell, Bird and Kobe all had better help than that, I’ll give that to LeBron.

But it was the way he handled this whole “Decision” that makes me want to puke up my breakfast sandwich (that and the eight Natty Lites I drank hours ago). Let’s be real here. James did not wake up Thursday morning and decide he was going to Miami; he knew well before that. In which case, why couldn’t he have flown to Cleveland and told Gilbert – like any classy businessman would do – and tell him "thanks but no thanks?"

It’s simple. Because he wanted Thursday to be all about him. He even told that to ESPN’s Rachel Nichols in a subsequent interview. But why should you and I find out about LeBron’s (or MeBron, as the Boston Globe’s Dan Shaughnessy so elegantly calls him) “Decision” at the same time as Gilbert?

Again, it’s simple: We shouldn’t. No, James owed nothing to Gilbert. If anything, Gilbert owes James years worth of thanks. But MeBron could have looked Gilbert in the eyes, like a man. Five days later, he still hasn’t, like the true coward that he is.

Again, I have no problem with LeBron’s choice to go to South Beach. He’ll have more fun there and probably win more there than he ever could have imagined. Good for him. But let the following words haunt “The Chosen One” for the rest of his career:

Classless. Coward. Pussy. Arrogant. Egotistical. Needy. Star.

Notice how “competitor” wasn’t included.

Wednesday, July 7, 2010

Diarrhea of the Mind, Episode 4: Talking Sports, Business Style

Let’s begin this post by giving a well-deserved shoutout to Allie Seymour for asking if the 4th of July was a national holiday. It’s OK, she’s an engineer.

Madison was pretty dull on Sunday. Wish I were home to celebrate the birth of our great nation in The Ham.

What the hell is with this Red Sox lineup? I worked for NESN for Christ’s sake and I don’t know anyone batting after Beltre. It will be a miracle if they can stay within five games of the Rays and Yankees with the entire squad limping around the clubhouse as they trot this JV team between the lines every night. Thank god for the All-Star break.

Speaking of baseball, the Stephen Strasburg All-Star game debate needs to be settled. So I’ll do it. Of course if you ask the players, they’ll say he doesn’t deserve to be voted in after making just six starts. Of course there are players more deserving of him. But baseball, as you should have learned over the past decade, is a business through and through. And what will entice the most eyeballs toward the Midsummer Classic, you ask? Strasburg pitching to A-Rod, Ichiro, Jeter and the like. He doesn’t deserve it over, say San Diego’s Matt Latos, but shit, this is entertainment and at the end of the day, it’s all about marketing and revenue. So Bud, once again, you’re an idiot (not the first time I’ve called out Selig in an article, by the way). Let the fans vote for Strasburg, and watch the ratings/buzz go through the roof after he strikes out the side against the AL’s best. It’s a no brainer. Unless of course you have no brain…

If LeBron goes back to Cleveland I may just boycott the NBA for a few years. But boy would it be funny for the Knicks and Bulls to both get screwed. Until ‘Melo’s on the market, that is.

Who would be dumber, Selig for not promoting Strasburg in the All-Star game, or David Stern for letting LeBron go back to the state of Ohio? And these are supposed to be business people?

If Bosh, Dirk and Amare are all spoken for, who’s going to play with LeBron anyway, David Lee? What a disaster. OK, enough about the NBA.

If you don’t have a Groupon account for your current city, get one; it’s pretty legit and saves you money on pretty much everything you’d want to do. And no, I’m not getting paid to promote the company.

Just locked up an apartment in Lincoln Park, Ill. (pending our application; keep your fingers crossed) and a flight/hotel to Portillo, Chile in one morning. All while “working.” What a day!

Back to Framingham in a week. Getting pretty sick of Madison, to be honest. Boy I’m going to regret that statement.