Some of you already know this but late in October, in my quest to run a marathon on all 7 continents, I knocked off South America by running in the Galapagos marathon. Sure 541,000 people a year cross the finish line in 1100 U.S. marathons. It is difficult – extraordinary, even. I’m telling you that because people who run marathons like to be reminded how tough it is. Just like Commercial brokerage is a tough way to make a living.
The run, the trip, the experience were life changing. Someone in our group asked, “Do you ever say to yourself, ‘you’re going to have to pay for that’, I mean when you make a mistake sure there are consequences and generally we learn best from our mistakes, but do you ever say that to yourself when something good happens?” Then he said this, “My question to you is how much and to whom do I owe for that particular shade the sky had this evening?”
While I am still on the subject of being thankful and having just visited essentially a third world state, I was amazed to learn that (according to Credit Suisse) if you have $3650, you’re amongst the wealthiest half of the people in the world. Also in the next five years the number of millionaires will have increased from 35 mil to 53 mil.
Although you’re more likely in America to be killed by a pizza box than by Ebola, I will tell you that is not the way people are thinking and acting while traveling. I saw more masks and awkward looks at people coughing and sneezing than ever before in airplanes and airports. Of course, we may all worry about airplanes and airports, but what about around the water cooler at work? Buildings have fire and emergency drills – will we soon have Ebola drills? A time may be coming where you will need to have a plan to deal with communicable diseases to protect your tenants, employees or customers.
As the unemployment rate falls, the number of skilled workers looking for a job also falls. When this happens, employers who need to find employees will have to hire them from other companies, and the only way to do that is by offering them more money to leave their current jobs. When this begins to happen, you will then see wages increase and concerns of inflation will be talked about in the press.
In addition to a good jobs report, we have had oil prices tumble to lows not seen in a couple of years. This, too, will be beneficial to the economy in the fourth quarter and especially this holiday season.
The USD Burnham-Moores Center for Real Estate’s Index of Leading Economic Indicators for San Diego County rose 0.3 percent in August. Augusts’ increase was the sixth gain in the USD Index in the first eight months of 2014. The Index started the year strongly, had two bad months in the spring, and has now increased for three consecutive months.
The outlook is for continued solid growth in San Diego’s economy at least through the first half of 2015. The local economy has done well so far this year, with the county on a pace to add almost 31,000 jobs. If that pace continues, it would be the third consecutive year with an increase of more than 30,000 jobs. The last time that happened was during the period 1997 – 2000, which was the “Golden Age” of job growth in San Diego.
Again, my trip was eye opening as to how the world is evolving (yes, I know Darwin’s theory originated in the Galapagos). The Galapagos only had power 24 hours a day 10 years ago and the water is only on for 2-3 hours a day now. However, I was amazed to see dirt floored rooms with iPads on the table. I even saw a machete wielding worker talking on his cell phone while working.
Fast forward, last month the Wall Street Journal ran an article that the most amazing company of the last decade, Google, is mapping the favelas – Brazil’s down-trodden neighborhoods – with the expectation that exposure to these backward communities, before long, will cause them to emerge from crime and disorder, and translate into economic opportunity. Layer on this story the even more remarkable saga of Alibaba and its NYSE IPO, and the likelihood that the Chinese platform will reshape consumer commerce between the U.S. and China.
I could go on (and will next month) with some of the amazing things that are emerging but the more important thing is to remember, “It is not the strongest of the species that survive. It is the one that is the most adaptable to change.” – Charles Darwin. Hope you enjoy the story.
The Galapagos Fisherman
An American investment banker was at the pier of a small coastal Galapagos village when a small boat with just one fisherman docked. Inside the small boat were several large yellow fin tuna. The American complimented the Galapaguen on the quality of his fish and asked how long it took to catch them.
The Galapaguen replied, “only a little while. The American then asked why didn’t he stay out longer and catch more fish? The Galapaguen said he had enough to support his family’s immediate needs. The American then asked, “but what do you do with the rest of your time?”
The Galapaguen fisherman said, “I sleep late, fish a little, play with my children, take siestas with my wife, Maria, stroll into the village each evening where I sip wine, and play guitar with my amigos. I have a full and busy life.” The American scoffed, “I am a Harvard MBA and could help you. You should spend more time fishing and with the proceeds, buy a bigger boat. With the proceeds from the bigger boat, you could buy several boats, eventually you would have a fleet of fishing boats. Instead of selling your catch to a middleman you would sell directly to the processor, eventually opening your own cannery. You would control the product, processing, and distribution. You would need to leave this small coastal fishing village and move to Quito, then LA and eventually New York City, where you will run your expanding enterprise.”
The Galapaguen fisherman asked, “But, how long will this all take?”
To which the American replied, “15 – 20 years.”
“But what then?” Asked the Galapaguen.
The American laughed and said, “That’s the best part. When the time is right you would announce an IPO and sell your company stock to the public and become very rich, you would make millions!”
“Millions – then what?”
The American said, “Then you would retire. Move to a small coastal fishing village where you would sleep late, fish a little, play with your kids, take siestas with your wife, stroll to the village in the evenings where you could sip wine and play your guitar with your amigos.”
