Archive for May, 2008

It’s for the Children!

I didn’t get much response to my post below about how children don’t matter as much as their parents do, so maybe I’ll go a bit further this time and see if a reaction is forthcoming.

There’s a commercial out – I think it’s a headlight commercial – that has a fellow stepping in and out of the headlights of a car, showing you how well the advertised car’s headlights illuminate things as opposed to other, less worthy headlights. The point is driven home as the man steps into the light again, this time with a small boy, saying “after all, I might not be alone.”

There’s another one, ostensibly about our profligate use of energy, showing a man on train tracks with a train coming, to illustrate the dangers we are apparently not facing about global warming, or some such foolishness, and that point is driven home as the man steps off the tracks in time, revealing, however, a small girl standing behind him who now does not have time to move out of the way.

A while back, there was a law in Utah that children had to be buckled into the car until they are roughly 41 years old, if I remember right, but there was (until very recently) no such law for their parents.

In each case, the point is subtle but sharp – we don’t actually care that much about adults. It’s children that really matter. Hit a grown man, that’s gonna put some nasty dents in your car, but HIT A CHILD!?!?!?!? UNTHINKABLE!

This is precisely wrongheaded. Exactly backward. Can we start with the purely economic analysis? (Is it even permissible these days to use economic analysis when talking about children?)

Strictly from an economic standpoint, children are a drain. They produce nothing (are destructive, even), earn no money, cannot defend themselves, and have no real capacity to generate value (other than entertainment), except by becoming adults. They cannot even make more of themselves (although I confess, it doesn’t look that way when my kids come in from playing outside on a hot day. I’d swear there are hundreds then, multiplying every minute). Adults, on the other hand, have useful skills, usually produce significantly more than they consume, and have the inestimable value of being able to generate copies of themselves (which is one reason women are so much more valuable than men: ten women+one man = ten potential children; ten men+one woman = nine likely homicides). By any economic measure, then, the adult is much more valuable than the child is.

How else can we examine this? Socially? Anyone ever run a nursery? Sociality is created by exchange of information and ideas, two things small children have almost none of. Productive sociality is created by work (quilting bees, corporations), two things even quite large children are terrible at. A nation of children would be 1) almost unthinkably primitive and crude and 2) overrun in minutes by ten grown men (or three experienced mothers).

And I beg leave to ask – if adults are simply there to protect children, what is the purpose of the children? After all, once they grow, they’ll become simply protectors of new children. What is the point of all this?

I’ll say it, even if nobody else will: adults are what children are supposed to become. Productive, interesting, honest, useful adults. That is the purpose for which we have children, to create quality adults. The purpose of assembling a car is to have a finished car. An embryonic car is a pile of corrodable junk. A child that will not become a productive adult is a fantastic waste of time, money, and potential.

Given this, given that when we’re growing anything else into something useful, we spend time, energy, and incredible sums of money making the environment in which the thing will grow as conducive to growth as possible, I have a serious question: why do we suck so bad at doing this for our kids?

Sticking with the car analogy, you don’t make a car into a car by letting the steel take whatever shape it chooses. This is perhaps a bad analogy here, as children do most certainly choose things and steel, in the main, does not. Nevertheless, I think the analogy has some use. Car steel is to become a car, not a train, not a fencepost, not a girder. A car. What kind of car, well, that depends. There are lots and lots of different kinds of car. Similarly, I don’t care if my children are chemical engineers or mathematicians or mortgage brokers or music teachers. Don’t care one little bit. All they have to do is become productive. Add something to the world they live in. Create, not destroy. But make no mistake, they do have to become adults. That is their purpose. That’s why they came here.

What is the first thing to do when you want to create something? Find the pattern of the thing you want to create. Might just be in your head, if it’s never been in physical form before (my sister Allison created a novel, a novel that had never been before she created it out of her head. I cannot express my continuing sense of wonder at the majesty of that act). But the pattern has to exist. In our case, we do have a pattern to follow in creating adults, and His name is Jesus Christ. But leave that aside for a moment, and consider that the pattern most likely to be used in molding children into adults is the parents of those children.

Let’s abandon the analogy here, for children, unlike steel, have remarkable ability to mold themselves. Children, as much as they contend this is not true, will do what their parents showed them, to uncomfortable degrees. The single greatest environmental factor in child development is the parents of the child. Would it not behoove us then to make the parents as copy-worthy as possible? Wouldn’t it be a good idea to work on improving the model, rather than focusing all our time and energy on the child?

You want your children to have a happy, stable marriage? Have one yourself. You want your sons to grow up to adore their wives? Adore their mother. Often. Visibly. Audibly. In front of the kids as often as practicable and decent (and it is okay to stretch the bounds of what your kids think decent public adoration is. They’ll groan about it, but seeing you holding hands and hugging each other in public is something they won’t forget, and secretly, it pleases them). You think your daughters should be decently covered when they go swimming? Cover yourself. Your kids spend too much time on computer games? Turn off your computer. Find something for them to do with you. You want your kids to treat your grandkids with respect and love? Do that for them. Treat them like they are capable of becoming what you want them to become. Give them responsibility, not “space”. Give them hard tasks, not “time to be a kid”.

I’m not advocating never allowing your kids to play. That’s unreasonable and stupid. You play. Why shouldn’t they? Play with them, for Heaven’s sake. But you work, so why shouldn’t they? Why should they get the idea from you that they aren’t capable of producing anything, that work is drudgery and should be avoided, that their “needs” are more important than yours? What’s that going to lead to? I’ll tell you what it leads to. Paris Hilton, that’s what.

This is tough love, folks, and don’t I know it. It puts the responsibility for raising and molding these children squarely back on ourselves. We want our kids to be great, well, then we have to be great. As great as we can be. And here is where the model of Christ becomes especially valuable, because we have a perfect pattern to follow in creating ourselves. It’s very hard to do this, much harder than throwing huge 2nd birthday parties for clueless and indifferent toddlers, but it is worth it, and after all, it’s what we are meant to do. We’re meant to be adults, too, and were not finished yet.

A Lesson in Private Property Rights

Look, it’s not that they don’t mean well. The courts really are trying. But the fact is that most judges do not understand how private property rights protect consumers. They consistently err on the side of “access for consumers” to data or markets, instead of protecting the incentives for providers to create that data or market in the first place.

To what do I refer? Glad you asked. Recently, the National Association of Realtors settled an antitrust suit with the Justice Department, agreeing to allow the government to strip its property rights in the name of “protecting the consumer”. Seems that the multiple listing services the Realtors maintain were, in some markets, restricting access by unaffiliated Realtors to MLS data. The access is now to be granted to anyone, decision effective end of the summer.

Who created the data? The Realtors did. Who has the right to sell the data to whomever he pleases? No one, apparently. Is this going to result in lower commissions for Realtors? Possibly. Is this going to result in lower fees paid by buyers and sellers? Not likely.

Why? Here’s the lesson: markets and repositories of data and other goods and services are created by Party A for one reason – to make a profit. The more that profit is protected, the more reason a party has to believe that his rights to the good or service will be protected by law, the more likely he is to create value by providing additional goods and services, and the more likely others are to start competitive enterprises to get some of the pie for themselves. If, however, there is no expectation that profit can be maintained or maximized, because by government whim property rights can be voided or involuntarily transferred, then creation will lessen and eventually disappear.

An example: you decide to open a lemonade stand. You buy the lemons, squeeze them, sugar the juice, get cups and ice and a cash box, and a small stand. You set up shop, and business is brisk. There are, however, customers that cannot come to your stand because they live too far away. You look at the profit in selling to them and decide that it doesn’t make sense to service those people, because the transportation costs are too high. Along comes the government and says, no, not only do you have to service these people, you have to service them at the same price you charge everyone else. This will, the government says, lower the cost of the service for these people. Otherwise it isn’t fair.

What do you do? Well, there are three options. One, you can continue to charge the same price and just lose money (in which case you are a hobbyist or a philanthropist, but not a businessman) or two, you can go out of business, or three, you can raise your prices for everyone, so that you can make the profit you were making before. Since option one is only available to a small number of people, the vast majority of us will choose options 2 or 3, which raises the cost of the lemonade for everyone (in the case of option 2, it raises it to infinity, since the lemonade isn’t available at all at any price), exactly the opposite of what the government intended.

Government, and especially the court system, seems to view property rights as outmoded, as being unworthy of protection (except, of course, for movies and music), and even as restrictions on trade and competition. In effect, with most antitrust suits, the government is telling us that if it weren’t for these pesky property rights, our costs would be lower and competition would flourish. In actuality, the reverse is true. As the kite falls when the “restricting” string is cut, so competition and choice disappear when the government fails to protect the rights of producers to the thing they produce. The string actually supports the kite, giving it resistance against which to rise with the wind. Property rights allow producers to have confidence that their work will be valuable. It is property rights that create competition, and the stronger those rights are, the better and more robust the competition will be, and the better the choice and the cost for the consumer.

This ruling, like so many, many others, ignores basic economics and property rights. It’s bad for practically everyone.


P.S. For a brilliant exposition of this, see anything written by Hernando DeSoto, or try this book.

Do the Children Come First?

Last week the best woman in the world, my wife, spoke at the Utah County Women in Business Conference as part of a panel of experts on family/business balance. She talked about traditions and how to handle things when your plans get disrupted by sick children, and things like that. She is, indeed, an expert on these things. The panel was well received, as was the presentation by Miss Utah, Jill Stevens, about her experiences in Afghanistan as an Army medic. It was great stuff. Estrogenous, but great.

After the presentations, as Jeanette and I were headed out to the lunch, we were stopped by a lady who said she’d been hoping to catch my wife, because she wanted to ask her a question. “How,” she said, “do you keep your marriage fresh with so many children? I’m just a newlywed myself, but I worry about that. How can you do it?”

We smiled at each other, because hey, part of the answer was right there in front of her. I go to my wife’s presentations, even on workdays, even when things are so hectic we can’t see straight. She’s more important to me than anyone, and there’s only one way to show that.

But there are other things, too.

A couple days ago I read an article about out-of-control birthday parties for children. Some of this stuff you cannot believe. There are the parties where the 1-year-old sleeps through the proceedings while 60 – that’s SIXTY – guests open their gifts to him. Parties where the kids are registered at, where the invitations specify that the gifts be worth at least $35, where the mothers complain that the gifts aren’t even worth the cost of the event. Well, imagine that.

There are hundreds of sites devoted to filling every moment of children’s time with activities from Tae-quan-do to cello lessons. With spending thousands of dollars a term on prep schools to get them prepared to go to Harvard or Yale. The modern generation of parents is obsessed with pouring half the national GDP into spoiling their children. If I were a psychologist, I’d suggest that this is a manifestation of repressed guilt over neglecting the things parents know are truly important. But I’m not, so I’ll just point out that if you don’t buy a kid’s clothes at Nordstrom, it’s much easier to not have to have both parents working.

Anyway, one of the things we told the lady was that we protect each other by being very explicit with our children that they are just not that important. Let me repeat that: our children have been told, in so many words, that Jeanette is the most important thing to me and that they aren’t. You’re welcome to call us and get the whole speech – I’m sure my kids can quote it to you – but the gist of it is that the kids are rentals. We get them for a while, then they’re gone. Only Jeanette is forever.

Now, the lady wasn’t shocked to hear this, but she was a bit taken aback. There’s a lot of crap out there about how kids have to know that they are the most important thing in the world, because otherwise it impacts their fragile self-esteem. This is a wet load of steaming horse manure. What kids need is stability, not lies or a false impression of their importance in the world. Our kids don’t feel less loved because they come second. Quite the contrary. They feel much more at peace because they know that the foundation of their world – which is the relationship of their parents – is solid and doesn’t crack.

We do not have perfect kids. They have inherited many of the worst characteristics of their father, and the only flaw in their mother (not much ability to sing). But our kids do not do drugs, and they don’t sass their teachers or Heaven forbid their mother, and they can work hard. They get good grades, and they love each other. They fight rarely and never yell. They sleep three, even four or five to a room and don’t complain. They wear old shoes and old hand me down clothes without whining. They play hard and they pray hard and they know their parents aren’t perfect, so if they want perfection they better look to Christ. And they do.

What do children need today? The same things they’ve always needed. Love and attention, and a stable place in the world. Some sticks and a ball to play with. Important work to do and adults to do it with. A roof and four walls, food and water. Interesting things to learn and interested people to learn from.

And that’s it. Everything else is gravy, and probably gets in the way of one of the things above. How do we keep our marriage fresh? We remember that the marriage is the entree, and children are the salad on the side. And we make sure our children understand this.

Of course, we love salad. :-)

Why Rate Watch?

Some have asked why I started sending out a Rate Watch email every morning. As if getting up at 5:30am were a pleasant thing (actually, if you try it, you find that it is, but that’s another column for another day). Allow me to explain.

There are two reasons that come to mind immediately. The first one is selfish – I do this because it sets me apart from the other billion or so mortgage guys in the industry. I actually understand how the market works, and the products it produces. I understand how everything from the weather to CNBC reporting influences the mortgage rate you pay. No, I’m no prophet, and I can’t always forecast accurately which direction rates are headed. I’m a tracker, not Nostradamus. But I know the landscape and I can help anyone with a mortgage, or anyone that works with people in real estate, save money on mortgage interest. It does little good to be that kind of professional if people don’t know about it, and as usual in business, if you want people to know something about you, you have to tell them. Hence Rate Watch.

But the second reason is a better one, and that is that it’s good for my clients. There are a dozen examples of clients of ours that scored an interest rate on their mortgage several ticks below the general market because of this service. We got together early, figured out what rate would make sense for them either for a purchase or for a refinance, and then we Watched until the rate came into play. And we locked it. Many on this list got a call at 3:50pm on a Friday, with an alert to lock. 90% of the loan officers I know have quit for the week an hour or so before that, but we’re still in the saddle because it makes a difference to us what happens to our friends. Since we only do business by referral, everyone we work with is a friend, so we watch rates for every one of our clients.

You can get this kind of service, too. It’s very simple. We need to have half an hour of conversation (okay, sometimes an hour to get the whole picture) to figure out what you want to do and the best way to do it. Then we get you on the Watch Sheet, and you not only get this email every day the market is open, but you also get a phone call when we reach your target and we have another five minute conversation to make sure we’re still doing the right thing. It might take a year to hit the target you want. But if it saves you $30,000 in interest, wouldn’t that be worth it? Especially since, let’s be fair, you’re not doing much of the work here. :-)

I sincerely want to have this conversation with as many people as possible. I didn’t start in mortgages, I started in financial services, and I run my business differently than other lenders. What if, I thought, you could take the consultative practices of stockbrokers and attorneys and mate it with the pay-for-performance of the lending industry (so no hourly fees, and no paying just for advice)? You’d have something powerful and different. Welcome to the Chris Jones Group.

So if all you do is read these posts, we’re glad you’re here and we’re happy to see you forever, especially if you like us and tell others about us. But if you really want the Full Monty, so to speak, you really owe it to yourself to send an email to and let’s start a conversation. There’s so much more than just this blog. Don’t miss out on the real power of Rate Watch.

Oh, right. The MARKETS. That’s the point of this whole thing, isn’t it. Well, folks, earnings season is over (better than expected), nonfarm payrolls lost only 20,000 jobs last month (better than expected), and the Fed is finished cutting interest rates, it appears. This is good news. It’s Friday, it’s May, and everywhere except Utah, where we had half an inch of snow on my tulips yesterday, Spring is in the air. Ice is off the Jordanelle and the trout are hitting everything in sight. And Charlie’s Pit Barbecue just opened three doors down. Life is good.

Which means bonds are getting shelled, and rates are rising, but it’s just too hard right now to be much disappointed about that, especially since the damage seems fairly minor. 30-year rates are splitting the gap at 6-6.125% (for 20% equity, 700 credit, and a job); FHA rates are lower by about .25%, and far fewer restrictions apply. We’re going to lose some ground today, so if you’re sitting on a rate, expect a call.

Have a great Friday. I’m buying.


P.S. Spread the word. If you like this, and find it useful, pass it on. It would mean a lot to me.

P.P.S. I especially want to welcome today Renee Ferjo, my favorite California Realtor, whose email address I just reacquired. If you’re buying or selling a home in or near Rancho Palos Verdes, go to I promise, you won’t be disappointed.