Happy Thanksgiving


November 19, 2018

For many years there’s been an ongoing debate in my household about whether spring or fall is the better season. I am not a fan of pollen, so I lean towards fall. Some argue fall is a time of decline. Plus, it signals the onset of winter. For me, it’s a time of reflection, a time for taking stock, and a time for thanksgiving. Plus, I tend to sneeze less.

Last week we celebrated our annual NHCO Thanksgiving Luncheon. Everyone contributes, bringing dishes prepared at home to share around our collective table. All the staples are there: turkey, ham, stuffing, endless side dishes and desserts. Nick, of course, formally sets the table. And then we break bread together, taking time to reflect and give thanks for all the gifts we’ve received (our client relationships chief among them). It’s a wonderful prelude to the official Thanksgiving holiday.

With all the hurricanes and wild fires and random acts of violence on the news feed, this year seems more precarious than most. I am thankful for all the first responders and law enforcement officials who put themselves in harm’s way day in and day out to protect us. I am thankful for the men and women in uniform who have volunteered to prosecute our wars and defend our interests across the globe to help keep us safe here at home. I am thankful for our free enterprise system and the rule of law that enables our country to be the greatest land of opportunity on the planet. The list goes on . . .

Sure, we have problems. And sometimes progress seems illusive. Then I remember that Thanksgiving was not always a national holiday. George Washington made the first Presidential Thanksgiving Proclamation in 1789, but that was a one-off event. In subsequent years different states celebrated Thanksgiving at different times, some as early as September, some as late as January, others not at all. Thomas Jefferson famously refused to proclaim the holiday on concerns related to state sponsorship of religion.

Not until the fall of 1863 did the holiday take shape as we know it today. Amid the Civil War, President Abraham Lincoln proclaimed a national day of Thanksgiving to take place on the fourth Thursday of each November. As we all know, the union survived those contentious times and great progress has been made in the years that followed. Much remains to be done but we can all be thankful for the progress that has been made.

Wherever you may be headed this Thanksgiving, we wish you safe travels, meaningful conversations, closer connections with those you love, and of course, a bountiful provision of good food.

As for my household, we will adopt the theory that calories don’t count until January.

Mike Masters1119


Hawaiian Home Price Slashed by 34%


November 12, 2018

A Hawaiian home has just been sold after reducing the original asking price by 34%. This might sound like the 50th state of the Union is suffering from a property crash. However, the final sales price was still $46.1m – a record for a single-family home sold in Hawaii.

On checking this story out further, I expected to see a description of an extraordinarily large home owned by someone famous or entrepreneurial, or both. I was disappointed on all counts.

This $46.1m bought a nice piece of land (15 acres on the coast), some interesting architecture (Balinese inspired with a main house and four “pavilions”), incredible light with breathtaking views, and even a mural or two in the bathrooms (if you are into that sort of thing). Surprisingly though the place only had 6 bedrooms which suggests that the sellers, who completed the house in 2006, were not planning for large family gatherings or for large scale entertaining. In short, this was a property built for indulgence on a dramatic scale.

So, who could have afforded to give such full license to building their ideal home? It was an investment banker and his spouse. The banker spent his entire career at Morgan Stanley until a 2014 excursion into something called “litigation finance” (which apparently is designed to fund legal actions and defenses). Now I am probably getting too old, but I always thought that the fabulously wealthy were supposed to come from the ranks of the incredibly talented, or those with a willingness to take significant risk by committing personal capital to developing a business. The mercenaries paid to run businesses on behalf of others could do very nicely but ultimately it was those with skin in the game that benefited most.

Those days are long gone of course and nowhere is that more obvious that in finance. Being close to large flows of money seems to enable compensation levels that would be unthinkable in most walks of life. Taking a small percentage of a very large amount of money still generates a very large amount of money.

Please know that my issue with compensation in the finance sector is not driven by a sense of social justice. I am much more concerned about the corrupting effects of the access to such wealth. Just this last week Goldman Sachs was reported as being strongly implicated in a very large financial fraud involving a Malaysian sovereign debt wealth fund. Only a couple of months ago whistle blowers at Wells Fargo revealed longstanding problems with the bank’s dealings with its wealth management clients. It is no surprise that the compensation structure for advisors is seen as being key to these problems.

So where does this leave us? First you have probably just missed the possibility of buying your dream home in Hawaii. Second be careful, and suspicious, about the financial motivations of anybody who gives you advice on what to do with your money.

Richard Rushton