Saturday, August 19, 2023, Rancho Santana, Tola, Nicaragua


News & Views

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More on Biden’s Early Resignation 

On April 18 and then again on July 28, I speculated that Biden would not be a candidate for the 2024 election. I came up with that conspiracy theory based on two observations:

1.- The obvious fact that he is in serious mental decay. He cannot make a speech without a teleprompter. He cannot coherently answer questions from the press. He cannot find his way up to or down from a dais. And he’s happy to admit to whoever is listening that he is verbalizing sentences that have been written for him and otherwise following instructions on what to do and what to say.

2.- The Hunter Biden story is going to get worse, not better. This wasn’t apparent to those that were getting all their news from CNN or the NYT, but it was increasingly clear to anyone that watched the Congressional hearings on the scandal. The Biden defense team has changed his script from “It never happened” to “I knew nothing about it” to “If he did something, I have nothing to do with it and I support him because I’m a loving father.”

That’s not good enough. And I believe the policy makers on the Democratic side know that. They are certainly aware of his cognitive issues, and they had to be aware that he was declining quickly. That’s why they kept him in his basement in the first place and made him the president with the least contact with the press in modern times. This strategy was successful because the contest was between Trump and anyone that wasn’t Trump. That’s why Biden won. But if they put him in the ring with Trump now, it will be a contest between an aging lamb and a still ferocious lion.

When I first predicted that Biden would resign, I suspect most of my readers thought I was crazy. There was no sign that he was not fully supported by his party’s leaders. And Biden himself reminded the press repeatedly that he would be running for a second term.

But the landscape of support for Biden has changed considerably. His ratings have steadily fallen since his botched and embarrassing withdrawal from Afghanistan. At the same time, there has been a gradual but noticeable decline in the support Biden has been given from Democrats in Congress.

Most tellingly, though, is the gradual loosening of the protective shield Biden has enjoyed by Big Media. After two years of trying to trash the laptop story, stories are beginning to appear – even on the front pages – acknowledging the millions of dollars that went from Russia, China, and Ukraine, from overseas shell companies to Hunter and dozens of other Biden family members.

Probably months before I figured it out, Biden’s handlers realized the dangers that lay ahead of them. And they certainly understood that the old policy of hiding Biden from the public wasn’t going to work in 2024. I don’t think the gradual withdrawal of support for him is a coincidence. It was decided long ago that in 2024 it’s going to be Trump versus… well, take your pick.

In this recently published essay in The Free Press, Peter Savodnik suggests a half-dozen people that could replace Biden as the Democrat presidential candidate for 2024.

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Notes From My Journal

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Shameless Self-Promotion!

K and I are spending a quiet week at our place in Rancho Santana after a very busy week in Cancun with 40+ members of our extended family. I mentioned on Aug. 11 that we call these biannual events Cousin Camps because, when we started them, about 30 years ago, they were meant less to reunite our coevals but to give our children and nieces and nephews the chance to develop close bonds – something my childhood lacked.

Cancun was a blast, a party. Rancho Santana is a recovery zone – quiet, peaceful, luxurious.

J, my editor, is growing impatient with my continued pieces about Rancho Santana. She sees them as shameless plugs, and perhaps they are. But I have no personal ambition to sell any more property here. I write about this place because when I come down here, I continue to be blown away by it.

This is especially relevant for me now because a small group of property owners have objected to the resort’s increased fees. They are doing their best to get us to lower fees across the board or make exemptions for them. That’s not going to happen. Not only because the increase was correctly done, but because the higher fees are still much lower than they would be in any other resort of this quality anywhere in the world.

About ten years ago, when I was running Rancho Santana, it was, at best, a 3-star resort. But then two of my partners took over the management and initiated a master plan to turn it into what it is today: an award-winning 5-star resort.

It cost the development partners tens of millions more dollars than the tens of millions we had already invested. And while the investment hasn’t been paid back yet, we are more than happy with the result. We now have one of the 100 best resort hotels in the world, and probably the number one resort in Central America.

Here are a few reasons why:

* The property is vast at 2,800 acres. (It takes about 20 minutes to drive through.) And it is beautiful, consisting of hills and valleys, cliffs and beaches, forests and flatland, and two rivers, one on either end.

* The property has five beaches, including a tree-shaded cove, a beach that stretches out from a 30-foot sand dune, two long beaches that are perfect for surfing, and one, perhaps the prettiest one, that you cannot find without a guide. It’s called Escondido (Hidden) Beach.

* Rancho Santana offers visitors a range of housing options – from 18 ocean-view rooms in an elegant seaside inn at the heart of the community, to 60 luxury apartments, also looking at the sea, to several dozen beautifully decorated private residences with million-dollar views.

* The resort offers every sort of recreational activity one could hope for, including horseback, hiking, and mountain bike trails; tennis and pickleball courts; ocean swimming, surfing, and snorkeling; boating and fishing; nature walks; yoga on top of a hill overlooking a forest and onto the beach; a 5-star spa; bocce ball, horseshoe, and cornhole courts by the main pool and outdoor bar.

Residents and guests can also use the sports center at FunLimón, which includes a soccer field, a baseball field, a full court basketball facility, a fully equipped gym, and a martial arts dojo.

* The maintenance of the resort is full-service, fast, and invisible. Everything is taken care of automatically and discreetly. You rarely run into workers, and yet they are working day and night. (In this respect, Rancho Santana remind me of Disneyland!)

* Rancho Santana has three restaurants – formal dining at the Club House, a tapas restaurant atop a beautiful small cove, and a taqueria on the family-oriented beach at its southern border. If you prefer to eat at home, you can order meals from the main restaurant, or you can purchase food and drinks at the “tienda,” which is also stocked with everything else you could possibly need.

All of these amenities are of a quality you’d expect from a Four Seasons Resort in Switzerland or Paris. In addition, Rancho Santana offers something in abundance that is not as prevalent in other 5-star resorts. I’m talking about the demeanor of the staff. Nicaraguans are, by nature and/or culture, warm and welcoming.

What else?

Did I mention that Rancho Santana is safe? Very safe. It is located in the midst of a string of small beachside towns and hamlets that are as safe as any small town in the US. Plus, the resort has a sophisticated electronic security system, as well as dozens of guards and security personnel that, like the maintenance folks that keep everything functioning smoothly, seem to do their jobs invisibly.

K and I have been to dozens of 5-star vacation resorts all over the world, but I think Rancho Santana must be the best. As I said, every time I come here, I am blown away by how great this place is. How big. How beautiful. How easy, friendly, luxurious, and safe. And the cost – whether you are a guest or a property owner – is cheap compared to any resort that is remotely as good.

For more information about Rancho Santana, click here.

 

 

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Health & Wellness

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Mask-Wearing No Longer a Controversial Issue 

Health officials have acknowledged that there is inadequate evidence to support the notion that medical-grade face masks, including N95, KN95, and FFP2 types, provide protection for vulnerable individuals against COVID-19. The UK Health Security Agency (UKHSA) published a rapid review report investigating whether masks protect those at high risk from the disease but was unable to find any scientific research with “usable data.” The reviewers examined 4,371 studies but found none that explored the effectiveness of N95 and equivalent masks for those at a higher risk of severe illness when used within community settings.

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Worth Reading

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Feed the Kids, Tax the Rich

Massachusetts has passed a new tax designed to provide all public school students with free breakfasts and lunches, regardless of their need. It’s a 4% income tax that is projected to generate $1 billion a year. Staying with the current political liberal zeitgeist, it won’t be a burden to 99.9% of the electorate because it will be levied solely on taxpayers making $1 million or more per year.

Will it work? On paper, it certainly seems like it will since it affects such a tiny part of the taxpaying population (0.1%). But what if it drives some of the state’s super-wealthy (and their companies and a portion of the employees of those companies) away from Massachusetts and down to a much less expensive state like income-tax-free Florida, taking with them the tens of billions of dollars they have been putting into the economy of Massachusetts.

Generally speaking, the wealthiest 1% of the taxpayers in the US contribute about 60% of the federal and state tax revenues. For Massachusetts, that means about $36 billion of the state’s +/- $60 billion yearly budget. How smart would the new tax seem then? Think about it. You don’t need a lot of taxpayers to leave before this great idea results in a drastic net loss.

I’ve got my guess. What’s yours? Read this.

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Fun and/or Interesting

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Quick Bites: Small Towns, Big Pharma, Education as a Scam, Sleep Advice, & a History Quiz

  1. The 20 Best Small Towns for Retirement. HGTV recently listed their choices for America’s best small (less than 100,000 people) cities for retirees. They based their evaluation on the average cost and standard of living. Some of their choices surprised me. In a good way. Click here.
  2. Big Pharma, Big Greed. An AARP analysis found that the 25 most expensive drugs for Medicare Part D plans have, on average, more than tripled in price since entering the market. Sanofi’s Lantus, an insulin pen, has jumped 739% since 2000. Click here.
  3. College Rip-Off. In Taki’s Magazine, John Stossel says college is now “an overpriced scam.” Click here.
  4. What’s the Best Position for Sleeping? Click here and here.
  5. History Quiz: Number One Hits of the 1960s. One of the first times I scored a 10 out of 10 on these self-quizzes. Click here.
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Tuesday, August 15, 2023, Rancho Santana, Tola, Nicaragua


Notes From My Journal

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Little but Not Brittle 

Someone once told me – and this may be 30 years ago – that the secret to making great ROIs in rental real estate is to “go small.”

By that he meant that buying three small houses at $200,000 each will bring more to the bottom line than one for $600,000.

Over the years, I’ve invested in a range of rental properties, from 1,000-square-foot condominium apartments that rent for $1,200 a month to 1,600-square-foot bungalows that rent for $2,400 to houses that rent for as much as $10,000. Looking back, I can say that he was mostly right. Apartment buildings consisting of smallish two-bedroom/ one-bath units gave me the highest per-square-foot cash flow.

But there’s another side to that strategy. Renting out smaller units can be more costly in terms of maintenance, management time, and bookkeeping. That’s simply because there are some things – like accounting, contracting, and customer service – that must be done for each unit, regardless of how much income it can provide.

And the likelihood of getting a single bad tenant in a smaller, less-expensive property is higher than it is for a large property. Even if you hire a management company to take care of the day-to-day, bad tenants = agita.

On the one hand, you have the benefit of larger net cash flow with many smaller rental units. On the other hand, you have the problem of higher maintenance and management costs.

And although I hesitate to mention it here for fear it will complicate the issue, rental revenues and maintenance and management expenses are significantly affected by the age of the property. This is obvious. Anyone that has inhabited both new and old residences understands the benefit of new.

So, generally speaking, it’s more profitable to own smaller units. But only if you can keep the maintenance and management expenses down. And the best way to do that is to buy new or relatively new properties.

If I were to begin again, I would be looking for relatively new (less than 20 years old) apartment buildings of 30 to 50 units. And I would have them run by a company that would keep them 90+% occupied by (1) providing good building management and customer service, and (2) using iron-clad rental agreements that would allow them to evict bad tenants as quickly as possible.

In other words, more revenue + less maintenance costs + tough contracts = higher per-square-foot profits. (I think of that as “little but not brittle.”)

But for several years, I’ve been thinking that there may be an even better deal out there: buying and renting out self-storage units.

They are considerably smaller than apartment buildings, so, in theory at least, they should be considerably more profitable. Management costs are less because there is so little to manage. Maintenance costs are inexpensive, too, because you are not maintaining the units per se (they are virtually indestructible), just the building itself.

Why I haven’t made a serious effort to look into this before now, I can’t say. I’m not sure I will buy anything, but I’m going to do some research and see if the opportunity for low-stress profit is as good as I imagine it could be.

This came to mind after I read an article in some business blog about the rental real estate industry. It said that, as a sector, self-storage facilities have always done well, in good times and bad. (Apparently, they made a killing during the pandemic lockdown.)

In another an article, written in 2021, The Wall Street Journal categorized them as “the best bet in real estate.”

Here are some facts:

* More than 10% of Americans lease storage space today.

* In June, they paid an average of about $166/month to do so. (Even when the value of goods in storage doesn’t match the price of storing them, customers weirdly don’t seem to mind.)

* That makes self-storage in the US a $29 billion-a-year industry. (And Extra Space Storage just struck a $12.7 billion deal to combine with Life Storage, its rival, making it the largest self-storage business in the US.)

* Google searches for “storage near me” are continually rising.

Plus, as pointed out in an article about this in The Hustle, “so long as there’s death, divorce, disaster, moving, and marriages, there’ll be people scrambling to pack things away.”

So?

So, I’m going to take the next step and track down someone that is in the self-storage business and see what he or she has to say.

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“A Cold Email Got Me My Job” 

“Everyone says networking is the route to success,” writes Olivia Reingold in The Free Press. “But I’ve always been a strong believer that any door can open if you score the right invitation. My advice? Don’t ever ask to ‘pick’ someone’s brain. The trick is to get inside their brain. Start by googling them, or rereading or relistening to their work. Why do you like it? Tell them that. Make them know they matter.”

I made essentially the same argument many years ago in my book Automatic Wealth for Grads.

Here’s the gist of some of what I said in the chapter about how to write a great job application letter:

The most important thing you need to realize about getting a job is this: The people who will be reading your letter are not really interested in you.

If they’re not interested in you, then what are they interested in?

I’ll tell you: They’re interested in themselves.

Think of getting a job as a direct-marketing challenge. The direct marketer knows that, to make a sale, everything he writes must be focused on the prospect’s problems and how much better his life will be after he’s bought the product.

When seeking a job, the prospect is the person you want to work for and you are the product.

So, the number one job of any sales pitch to that prospect (a letter, phone call, or personal meeting) is NOT to sell yourself as smart and well educated, but as someone smart and knowledgeable enough to solve his problems.

And to do that, you have to do a good deal of research. To begin with, you should research the industry to understand its problems and challenges. Then research the company itself and find out everything you possibly can about it. Is it growing, in limbo, or losing revenue? What are the main factors affecting that? And then, finally, dig up what you can about the person you are going to be working for. What kind of boss is he?

If your first effort is a letter, make it as specific and personalized as you possibly can. Don’t make it sound like you’ve been snooping around, but make it clear that you (1) understand how the business works, (2) have some idea of what the primary challenges are in terms of profit growth, and (3) are interested in helping this particular person accomplish more with less stress because you will be there to take responsibility for whatever he needs.

   Click here to read Olivia’s article.

And if you’d like a copy of Automatic Wealth for Grads – for yourself or as a gift to a young person just starting out – you can order it directly from us. List price is $22.95. But for readers of this blog, the price is $15 (which includes free shipping).

To order your copy:

* Send a check for $15.

* Make the check payable to Cap & Bells Press, LLC. (No cash, please.)

* Include your name and mailing address and mail it to:

Cap & Bells Press

Attn: GKoo

290 SE 2nd Ave.

Delray Beach, FL 33444

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Worth Considering

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The COVID Response: Meet Dr. Fauci’s Replacement

Was She as Wrong About the Facts as He Was? 

Dr. Anthony Fauci, arguably the most likeable non-elected government official in recent memory, resigned last year from his role as director of NIAID (National Institute of Allergy and Infectious Diseases) amid mounting criticism of his handling of the COVID pandemic.

While looking for a replacement, the NIH appointed Dr. Lawrence A. Tabak as acting director. And last week, he announced Fauci’s permanent replacement – Dr. Jeanne Marrazzo, head of the Division of Infectious Diseases at the University of Alabama in Birmingham.

In introducing Dr. Marrazzo, Dr. Tabak said, “Dr. Marrazzo brings a wealth of leadership experience from leading international clinical trials and translational research, managing a complex organizational budget that includes research funding and mentoring trainees in all stages of professional development.”

To be sure, Dr. Marrazzo has impressive academic credentials. (A bachelor’s degree in biology from Harvard, an MD from Thomas Jefferson University in Philadelphia, and a Master of Public Health in Epidemiology from the University of Washington.) Academic credentials are meaningful for people that aspire to be academics, but when it comes to a job that matters as much as this one does, what’s more important is specific experience, past performance, and personal characteristics like honesty and integrity.

In the case of Dr. Marrazzo, I have concerns about what she has said and done in the recent past. In researching her, I discovered that she was a big proponent of mask-wearing. In fact, as late as May 2021, she was quoted as saying that she wears a mask indoors. Click here.

She also promoted the government vaccination misinformation. In July of 2021, she was blaming the spread of COVID on the unvaccinated, saying, “So much transmission in our community because a majority of people are not vaccinated. The opportunity for little kids to get infected is much higher than where the vaccination rate is much higher.”

Based on what I’ve read so far, it’s clear to me that Dr. Marazzo has been promoting the company narrative since day one. This, by the way, is not completely surprising. Her role as head of NIAID, like Fauci’s, is not to tell the truth but to say what the organization thinks the public should be told. Her role is not that of a doctor or a scientist, but of a public relations spokesperson.

I’m hoping I’m wrong. I’m hoping she will stand up for the truth. I’m withholding judgement for the moment. We’ll see soon enough.

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