Finding my "Numbers"

About a decade ago on a trip to the US while I was living in Shanghai I bought a book called “The Number” which was advertised as “the top personal finance book of the year”. I didn’t care that much about the financial advice but was interested in the “life style” angle of thinking through how I would spend the time remaining in the “3^rd and 4^th quarters" of my life. I knew my time as an ex-pat was in the final chapter and was confident I had become one of the many expats that “can’t go home” again. At least from a work perspective.

My dog-eared copy

During my eleven years overseas a series of well-crafted ex-pat agreements enabled me to save north of 80% of my income. I wasn’t worried about survival when the axe inevitably fell but I was concerned about keeping my life interesting. On evening walks with our then puppy Yuki, I circled the gated community we called home amazed that I actually had lived the better part of a decade in two Asian countries. My 25-year-old self could never have contemplated that possibility. Nor could I have imagined that my older daughter would ten years later have written one of the “top personal finance books” of the year. After all that was the year I encouraged both my kids to put some of their savings I held for them in stocks. My younger daughter said “buy China Mobile and SQM”. A year later she had doubled her money. My budding financial guru responded pithily: “Dad I am too busy to think about stocks; I will just leave my money with you or in the proverbial mattress”. I digress but my point:  life is full of surprises.

Regular readers of my blog already know that I became repatriation statistic within two years of returning to the US. My twenty-one months as a “dead man walking” before the curtain came down on my corporate career was one of the most difficult periods of my adult life. In a vain attempt to cling to ex-pat life I made many trips back to Asia that were not absolutely necessary from a business perspective but were mainly to escape my unhappy circumstances back at HQ. I liked to think of those trips as “mental health weeks”.

Despite not feeling I needed the investment counsel in the book “The Number” I actually did calculate my personal “number” as it became more and more obvious a “career change” was imminent. I still had one daughter in a very expensive college and was only in my middle 50s so if my family history was any indication, I was likely to have another 30+ years on the planet.

I had made only one decision about life after I left my long time employer – I would never be an employee again. I hoped my knowledge of the lithium markets and time in Asia would enable me to eke out enough income to pay the bills. I was not confident.

Looking back to the future income/savings assumptions I used when I crafted my “number” is a great illustration of how we put limits on ourselves. The spreadsheet is almost laughable now but the fear I felt at the time was no joke.

So when I was told on 9/10/2012 that I was being cast to the curb at the end of the month, I spent several uncomfortable days contemplating my “number” and running budget scenarios based on my severance package and extremely conservative assumptions about what I could make working for myself.

I was very fortunate that customers from Asia came to town the week I got fired. Of course it was embarrassing to tell them I was on my way out the door but sharing my story with them while playing golf led to further discussion of what I would do in the future and ultimately my first consulting offer. That agreement which has been renewed five times at a annual “signing” ceremony dinner in Japan is financially the smallest agreement I have had but was critical in helping me believe I was going to be fine. Within 60 days my new client had arranged a meeting with a major Japanese company that led to my second contract at 4X the compensation of my first agreement. Within another 90 days I signed three additional agreements with companies in China and Australia.

My departure from corporate life could not have happened at a better time. Lithium was at the beginning of a boom period. Because of my ex-pat years, I was uniquely positioned to benefit from the sudden growth in lithium demand.

I was very thankful so many friends I had made over the years came to my aid but during the first couple of years working for myself, I spent a lot of time thinking that “this can’t last”. Fortunately, I was wrong – the past five years have been among the most interesting, fulfilling and profitable of my work life.

I plan to continue to ride the lithium wave for the foreseeable future. The current challenge I have now is a classic first world problem. Recently I have spent too much time working and too little time doing other things like spending time with my wife, hiking, playing golf and skiing. I had to go back and read “The Number” again to get perspective on how to split time between work and play in the future. What originally attracted me to the book was the combination of dialog on “Second Acts”  and lifestyle/balance after your first career was over.

As the child of depression era parents I grew up with a constant worry of the proverbial “wolf at the door”.  I found myself working to work instead of working to live. I wouldn’t make a very good millennial…..

This week I was approached by a major global company – you would all recognize the name. They wanted to have a conference call to discuss retaining me to help them decide their lithium strategy. It was five of them from three different countries and just me. They grilled me about my company, Global Lithium, wanted to know about my organization, services I provide and “success stories”. I laughed said, “well you guys found me, my organization is small, in fact my two partners Yuki and Fiona can’t talk and have four legs.” After a pregnant pause they changed gears and focused on what they wanted me to do for them. As they talked I started having a “corporate flashback” – too many people involved their project, a lot of MBA speak and obvious politics among the participants. What I like to call the “corporate buzzwords and BS” syndrome. A few years ago I would never have walked away from a potentially lucrative opportunity (read: "large number") with a big name but now I am finally realizing it is ok to “just say no”.

Based on timing, luck, having good friends and some hard work, my financial “number” is no longer an issue. How to spend time over the “number” of days I have left on the planet is the next frontier. Being a slow learner, I leave for Japan tomorrow, come home for three days and then depart for Argentina. Yes, it is work but it is also enjoyable so the temptation to work too much is hard to manage. Yesterday I decided to take the better part of a month “off” – working only a couple days a week from mid-March to mid-April and hopefully lowering my golf handicap and getting in a couple ski days.

Time will tell if that works out.

A (Very) Late Thank You Note

Five years ago today I received a wonderful gift that changed my life.

When I was a child, my mother always insisted I write a “thank you” note when I received a gift. Compliance was required within 48 hours. Grammar and spelling were checked. Postage was provided.      

The habit continued into adulthood although the notes today are normally sent by email, text or other form of messaging.

So today I am “righting a wrong” by writing this note:

Dear FMC:

Please accept my heartfelt appreciation for firing me on 9/10/2012. I can’t thank you enough for creating a “Reduction In Force” (RIF) "group" of one just for me. That was really special - above and beyond my wildest dreams.

I feel terrible that I have waited so long to let you know your kindness will never be forgotten.

All the best,

Joe

                                                              The “Backstory”

The true irony is I am very thankful to FMC. Don’t look for a sarcastic punchline. One isn’t coming.

In 1992, FMC allowed me to transition from a boring finance position to the commercial area. When their lithium mine in North Carolina was running out of ore before their brine project in Argentina started, they gave me the assignment to acquire lithium stockpile material from the company that originally outbid them. They were desperate for feedstock to keep the business going. That was just the beginning.

When SQM’s start-up changed the the competitive balance of the industry in 1997, I was sent to Santiago to “make peace” and set up a meeting for my boss. Months later I got to negotiate a tolling agreement with SQM which was critical to maintaining FMC's position in the lithium market. Once the details were agreed on, of course, the agreement became the “work” of my boss who got the credit but I got the experience. 

Extensive international travel came next as I was given global responsibility for FMC's upstream lithium business. Ultimately, in 1999, I was asked to move with my family to Japan which was the fastest growing market at the time. We arrived in early 2000.

I loved my eleven-year ex-pat life with FMC. So did my family. My time in Asia put me direct contact with the people who started Ganfeng and Tianqi. I dealt directly with all the major lithium battery companies in Japan, Korea, China and Taiwan from the time they were just getting started. I spent time with the major spodumene converters and made countless trips to Xinjiang to spend time with the original lithium producer in China.

While in Asia, we traveled from Tibet to New Zealand

I was also President of two Japanese Joint Ventures and a Chinese Wholly Owned Foreign Entity (WHOFE). Great experience.

I was “the lithium guy” in Asia long before lithium was cool. FMC enabled that and, yes, I am sincerely thankful. The fact FMC neglected me from an oversight perspective was a huge benefit. They always paid the bills. Actually at one point they paid my expense reports for nine years without any of them being properly approved. When an internal auditor discovered their process broke down they sent an audit team to Asia. When the multi day audit was over, they discovered they owed me some money based on how they did the currency translation.

They didn't play golf in Xinjiang 

I have written a couple of times about the mean spirited and petty way I was actually “let go” in 2012 but that is only how my FMC story ended. Most of my time there was fun, it simply ended on a sour note.

FMC didn’t have an effective process for handling ex-pats in Japan or China so I got to create many of my own rules which for me was an ideal situation. I didn’t like the ex-pat “handbook” from the company that FMC hired to “administer” my assignment so I got my direct bosses to agree to “side letters” – waivers to the parts of the policy I didn’t like. When corporate HR found out – they were not happy.

Our daughters embraced life in Japan

I had several bosses in the eleven years I was out of the country. Since my business area was growing fast and very profitable and my day was their night, I rarely communicated with HQ beyond sending a short monthly update.

We lived in an apartment in Japan overlooking Kobe Bay that cost the company 8 times more than my US house payment. Later, in Shanghai, we had a great house with a driver and maid. My daughters went to excellent international schools at company expense. My family also had the opportunity to travel extensively in Asia, Australia and NZ.  I had golf club memberships in Japan and China. What's not to like?

Given almost all my bills were paid directly by the company and I got a cost of living stipend, I saved  85% of my after-tax income for eleven years. That would never have been possible if I didn’t stay overseas when nobody else was willing to replace me.

In Cambodia we found the guy on the cover of the guidebook

 

In January 2010, FMC brought in a new CEO who changed the company and not in a positive way for many employees including me. FMC always tended to have a baseless arrogance but the new guy took it to a different level. I knew my days were numbered two years before I got the axe. On top of that, at the end of 2010, I moved back to the US after eleven years building the lithium business in Asia with little adult supervision from HQ. Reverse culture shock was about to hit me.

When I arrived back in North Carolina after eleven years outside the US, I was not prepared for what the US office had become: a more bureaucratic, politically correct place. A place where I didn’t want to be. I hung around because my younger daughter was attending one of the most expensive universities in the US and if I left on my own I would have had a non-compete agreement to deal with. The non-compete was void if the company let me go so really getting fired was “win-win”.

Towards the end of my ex-pat assignment, I worked for a very capable person who was extremely helpful to me then and continues to be to this day. He left the company a few months before I did and helped me transition to what I am doing now. Thanks, Jon.

A recap of the day I was fired and my wife's wise advice to me can be found here:  http://jpl-expatblog.blogspot.com/2012/09/moving-on.html but the point of this exercise was to make it clear that I do really appreciate the fact that, absent my experience at FMC, I would not have Global Lithium today.

I miss my former FMC team in Shanghai but am glad I stayed in the lithium business

On the evening of 9/10/2012 I called my daughters in LA and NYC to tell them I was no longer working for FMC. I was surprised and pleased that in both cases they said they felt bad it had happened but it was probably best and that they appreciated that FMC had enabled them to grow up overseas. Both my daughters graduated from high school in Shanghai. 

Of course appreciating the past doesn’t mean I won’t continue to express my feelings about the way FMC (Livent) runs their lithium business now. 

Broke Millennial(s): The Untold Story

I was the last arrival into a large family. I became an uncle at age 12 and by age 18 my nieces and nephews constituted a small tribe.

Babysitting was as natural to me as mowing the lawn. I learned to discipline (much to one of my sister’s chagrin), tell distracting stories to stop tears, bribe when my stories were ineffective and to shamelessly use my cute charges as a conversation starter with girls (they were better than a puppy but I digress). I have always been comfortable around babies and little kids.

Despite my comfort level with children, becoming a parent was a sobering event. Our first daughter’s (Erin) birth in 1989 was a seminal moment in my life. It went quite smoothly for me but required substantially more effort from my wife, Connie. Like many new parents, I think I had FOSU (fear of screwing up). Time passed, Erin seemed to be pretty normal when her little sister Cailin arrived three years later.

Day 1 as a parent: trying not to show my "FOSU"

I blinked a few times and Erin was starting school. Connie was a force of nature as a parent. The girls were busy: school, play dates, sports, homework, parties, etc.  Our kids were strategically placed for photo ops so often at community events that the editor of the local paper issued a temporary ban via memo to her staff on “those Lowry girls” picture being in the paper. True story - I know because the editor’s husband worked for me and “fessed up" in a moment of weakness.

My role as Dad was pretty simple – be a good playmate, read bedtime stories/say prayers, settle an occasional dispute over the last piece of candy, help put a tutu on our 70lb dog before an impromptu play. Pretty basic stuff. That is not to say I didn’t take my role seriously, Connie just excelled at doing the harder stuff leaving me to ponder where I could “add value”.

Erin sharing another "life lesson" with her father

The girls were in elementary school during an era when many parents spent more time worrying about “protecting” their kids from reality rather than helping them learn how to deal with it. If I screwed up at school in the 1960s and 70s, I expected that a little “muscular Christianity” would be dispensed to help me see the error of my ways. By the time I reached adulthood, teachers could get into trouble for giving a child a “stern look” or somehow “creating a hostile environment”. Of course, we wouldn’t want to “crush” junior’s spirit or lower her self-esteem. A bit of overstatement is intentional but the emerging trend was clear. That was one reason our daughters never entered the public school system. The catholic school where our kids spent their first few years of education still believed in discipline.

Not spoiling the kids was a theme in our house. We saw that happen with many of their peers. We wanted the girls to develop solid work ethics. From an early age we used “market principles” to try to accomplish this goal. For example, when the kids asked for something that was a “want” rather than a “need”; they were expected to pay for a percentage of it from their “piggy banks” which included money they earned from various modeling and acting gigs arranged by their mom. “Of course honey, you can have that $12 teddy bear, you just need to give me $6 for your share when we get home”. We caused the homelessness of many stuffed animals with this policy. Were the girls emotionally damaged? I don’t think so. A few years later, Erin would build a brand in part by telling stories about her parsimonious father.

We spent much of the girl’s childhood living in Asia. Most of their pre-college education was in schools in Japan and China. Nothing like competing in schools with the progeny of Asian “Tiger Moms” to help hone a child’s work ethic. Compared to the Japanese, Chinese, Korean, Singaporean, and other Asian parents we were “pikers” with no academic standards. The occasional “B” that hit the report cards in our house did not cause an emergency parental summit meeting like it would in the home run by a “Tiger Mom”. Silly me, I didn’t even know that taking the SAT a dozen times was a “thing” until we lived in Shanghai.

Despite living abroad, the girls still worked odd jobs – pet and babysitting, being the “English voice” on language tapes. As an eight year old, Cailin modeled for a Japanese clothing catalog. You can imagine how thrilled I was to find my baby’s picture was in a catalog that said “PENTHOUSE” on the cover.

Anyway – you get the picture. Had we stayed in the US our parenting style would have seemed “severe” but by Asian standards we still qualified as “shiftless” Americans. Truly a “win – win” situation for us. When we told Asian friends at parties that we expected our kids to contribute to paying for college (hopefully by getting scholarships) smiles eroded into icy glares. What kind of human being didn’t “sacrifice everything” to ensure their offspring attended “an Ivy”, Oxford, MIT, Stanford, etc? For the most part, an Asian “safety school” was an “aspirational” choice for 98% of US students.  It always seemed ironic to me that success for a Korean mom who looked down on “weak American standards” was for her child to attend a top ranked US school. American universities were the "the educational promised land". “Call us shiftless if you must but our colleges are still the gold standard” – I never said that but I thought it often as I listened to many a stressed out Tiger Mom opine about her child’s college entrance prospects. “Harvard just sent a rejection note, and he is waitlisted at Princeton, so far he has only been accepted by Duke – where did we go wrong?”

Our standards were a joke to "Tiger Moms" 

Fast forward a few years……………………… Erin, our elder “bundle of joy” is out of college, packing to move to NYC with her drama and mass communication majors (from a school that didn’t make many Asian “safety school” lists) to join the “working poor”. I could hear the distant Tiger Mom’s virtual giggle – “what is mass comm? - is it math for white people?” “I am so glad MY daughter graduated with honors in advanced math from MIT and is going to NY to work at a boutique hedge fund”. Blah, Blah, Blah.

You can read about Erin’s “working poor” years on her blog: www.brokemillennial.com. The “happy ending” (the American kind not the Asian version….) was that while being “underemployed” and working three jobs; Erin’s creativity and work ethic kicked in.

The "donut" story became a book and a business

The success of Erin’s blog that morphed into a book deal thrilled her parents and her little sister. Her blog cast me in the role of the evil father that made her pay for things she wanted as a little girl and contribute to her college expenses. I am glad the girls are too old to be taken by "social services". I became of big fan of her blog wondering how she was going to make me look like a “financial fascist” on an almost weekly basis.  

Erin came up with what she called her financial epiphany aka “origin story” where I helped stake her donut selling business during a community garage sale day but then had the nerve to teach her about net profit at the age of seven by taking the cost of the donuts out of her pile of cash from the sale and making her pay her four year old sister a living wage. I did not insist she pay for Cailin’s health care.

Week after week, month after month, I waited for Erin to tell the tale of my proudest moment as her financial mentor.  Yet four years into the blog, the most valuable lesson I felt I imparted on her impressionable mind was yet untold. She loved the Krispy Crème donut tale and her angry assault on my Halloween “candy tax” but how, I pondered could she have forgotten the “TCBY moment” as I liked to think of it. I scoured the advance copy of the book she sent us – a black cloud descended as I pondered the improbable – the TCBY story was long forgotten.

A couple weeks ago there was a Broke Millennial “book launch” party in New York. The hostess of the event asked me to say a "few" words. I smiled and thought to myself “quite a few words, the TCBY story needs to be told”. So, microphone in hand, I launched into my favorite Broke Millennial story but since Erin forgot it maybe I should leave it for another day. The lesson here folks is you never know which lessons you try to teach will actually “take” with your child.

If you haven't bought the book, it makes a great graduation gift

As a parent you don’t get a report card for many years. Erin went through high school and college without showing much evidence that the financial lessons we tried to teach the girls had made an impact on her thinking. Perhaps it required the stress caused by having a low paying job while living in a high cost city to activate the dormant “life lessons”. In any case, I will not try to take any credit for the creativity Erin showed in morphing from Broke Millennial to a published author with her own successful business. I am just glad it happened.

Cailin is claiming the Broke Millennial mantle from Erin

According to Erin’s younger sister, Cailin, she is the new Broke Millennial in the family. Cailin works in the rough and tumble entertainment world in LA. Cailin is the proud parent of our “grandhamster” Thelma. Thelma starred in a recent Katy Perry lyric video that Cailin produced. The video has over 70 million views on YouTube. We don’t expect Cailin’s Broke Millennial status to last long.