Saturday, May 27, 2017

Milkweed and Monarch Therapy

Milkweed and Monarch Therapy

Slope Flowers Looking Northeast
This field of Coreopsis at Provision Living at Columbia in the spring of 2017 is the result of two years of succession; the natural process of plants competing. The first arrivals in the area create the conditions for other species to thrive. 

It is beautiful to most people. At $7 per plant in a nursery, this is what several thousand dollars looks like today and for several months to come.

The beauty was so overpowering that two caregivers made table decorations for memory care.
Table 1
Table 2

Table 3
Table 4

These decorations cost about $20 each from a florist. They last about a week.                         

What happens on this slope will also now follow two paths with very different costs. Past tradition is a bulldozer, haul in good dirt, and plant whatever is in fashion. This is high maintenance. Water, water, and water. Only a few people can now afford to live in an artificial world that defies succession year around.

The new tradition is to learn what belongs here; what has evolved to thrive here. Engineering is being replaced with husbandry. Invasive non-native plants must be carefully removed. Engineering still plays a role in killing everything above ground and starting succession over again.

[However this construction site filled a valley over 70 feet deep with an 18-foot mound on top. Any seed bearing soil was either removed or deeply buried. What is growing here now comes from a prairie seed mix applied in the fall of 2015; and a truck load of dirt added on top of the mound (the lighter area on the east side of the property). Succession then starts with this seed mix and dirt containing unknown species.] 
Pre-Provision Living at Columbia (Mapquest)
Provision Living at Columbia (2017)

The contractor did not clear, in any way, a three-acre area along the north boarder that was approved for clearing. This kept the view of neighbors from the north being a fortress on a hill and kept the view of residents in the building as a natural woods on the cliff side (with no extra charge).

A Couple of Plants
The sloping field of yellow Coreopsis points out the need for a canvas of appropriate size for each desired effect; thousands on a hillside, a dozen in a vase, and only one or two plants in a garden or a small naturalized area.         

Our next job is then to remove any undesired plants and to add plants that can compete with little maintenance. Each plant has more interactions with the environment than just its contribution to the beauty of a landscape.

The milkweed is a good example. There is one species where one plant can feed many monarch butterfly caterpillars. There are several that are ornamental and currently becoming popular in landscaping. It may take several of these to feed one caterpillar; that is, if they have not been treated with a pesticide to protect the landscape investment ($7 to $37 plus planting).

[Treated plants kill the caterpillars. The expensive beautiful poisoned plants become death traps. An attempt to help, has the opposite effect! The eggs are wasted. Poisoned host plants reduce the population of monarchs.]
Milkweeds Ready for Fall Migration Monarch Generation

My wife and I raised, indoors, enough monarchs, on our two best years, to tag 100 butterflies. Each year one was found in Mexico. We had over 300 healthy common milkweed (Asclepias syriaca) plants each year. [The author of the scientific name thought the common milkweed, a native of North America, came from Syria.] 

The Monarch Butterfly Sanctuary would return to a forest if left alone; just as it did when the fields were no longer farmed in the past. Milkweeds would be a part of that succession. In time the native trees would prevail; as they did before being cleared for the current use of the land. A stable, climax, community would return. There would be few if any milkweeds. But this will not happen.

Non-native invasive species now disrupt normal succession. Invasive species crowd out, out compete, other species; other plants and the animals that feed on them. Diversity is reduced. We need to manage succession in such a way that milkweeds can thrive in a stable environment.

My understanding is that this is not difficult for this plot of land. Just mow in the spring and again in the fall, at the proper time; before the milkweeds are up in the spring and after the plants are going dormant in the fall (drought, freeze, or deer).

Crown Vetch from Top of Coreopsis Field
The Community Conservationist for the City of Columbia provided invasive species literature on crown vetch and bush honeysuckles. The crown vetch has been pulled from the sloping field of Coreopsis (some root parts still remain). The deer are feeding down the crown vetch on the upper flat northeast area. Both of these areas will require repeated inspections and plant removal until crown vetch is no longer in the community.

The bush honeysuckles are on neighboring property. Their invasive behavior can be managed by mowing, by removing seedlings and by having neighbors replace them with native alternatives. Native Alternatives to Bush Honeysuckle by Alan Branhagen in the spring 2017 Missouri Prairie Journal, Volume 38/Number 1.

A plant survey will determine what is growing now in all areas from the 2015 seeding and new dirt. These plants then serve as indicators of what other plants to add for a stable, low maintenance environment that includes milkweeds, and nectar plants; that turns a weedy area into more than a monarch rearing milkweed patch. It becomes an attractive self-sustainable sanctuary for monarch caterpillars and butterflies, and other pollinators. Residents can have a hand in growing plants for many years.

Milkweed seedlings were provided by the city of Columbia, May 19, from Monarch Watch. Memory Care residents transplanted the 50 plugs under the direction of Danielle Fox, Community Naturalist. The resident's active participation and expectations of what is yet to come was a well-intended result of this project.

Meanwhile we can wait for the fall monarch butterfly migration to lay eggs and feed on these plants. This generation will then fly to Mexico. The plants will then be put out on the sanctuary this fall where they can go dormant and be ready to bloom in 2018; ready for the spring monarch butterfly migration heading again toward Canada.

Monday, May 22, 2017

Communication Within and Between Performance Levels

(Written two weeks ago.)

The events of yesterday again highlighted the success and failure of communication between residents and their loved ones and caretakers.

A past post reported my observation (at South Hampton Place where seven refugees from the flood at Provision Living spent three months) of my wife and another resident to seemingly communicate without words. I have now seen this happen twice here.

We were seated at a table for four; my wife to my right and another resident across from me. He said something to me. She looked at him and grinned.  Then in several small increments their smiles slowly turned into a full-face grin. My wife nodded her head and they both burst out laughing. Their faces then returned to normal.

The second time, we met a resident in the activity area. On meeting, without a word spoken, this grin and chuckle occurred. The two then went on their separate ways; seemingly feeling much better for the encounter. 

Then later in the day, a caregiver shared her observation. “M___ is such a good helper. I was just at the point of leading R____ to the dining area when M___ touched the back of his hand with hers: he stood almost straight up and the two walked the rest of the way.”

My wife has resumed walking her two patients up and down the hall, but to a less amount than before the flood. The three have something in common at the lower end of the performance pick order of residents. This is a fact, but it is still hard for me to accept.

Each has developed a unique dementia personality that swaps in and out of “normal”. Living in this memory care environment, they can be happy most of the time.

Now, in contrast, is the communication failure between memory care, assisted-living, and independent living levels, in and out of residence and the resulting mental anguish. I still eat breakfast in the main dining hall.

I mentioned to the person seated across the table from me, that I had seen his silhouette, against the glass doors, across the memory care activity area, on a prior day, as we were eating. “Yes, I was getting my wife out of prison (memory care). I just do not understand her anymore.”  He was reading all he could find and had attended ALZ meeting in his hometown.

His problem and mine have been the inability to apply generalizations and policy statements to our specific situations. We need a frame of reference that fits two very different worlds. One has a clock where time is predictable across minutes, hours, days, and years. The other has, as I have now come to realize, is not a case of no clock or a broken clock, but a matter of several clocks.

Memory care is not a prison. The only differences between memory care and non-memory care residents are that memory care residents cannot remember the door code and they get lost when they wander. Memory care is more like living in a big family, that shares dining and activity areas, than assisted living, which is more like a five star hotel where people can hid in their apartments.

He must stop relating his wife’s behavior to past behavior. He needs to attend to what will make her a happy day, today and tomorrow. She is who she is today. And that is hard to accept, if you are continuing to compare now with the past or what might have been. It can promote grieving each day rather than enjoying each day or part of day.

He must also find things to occupy his own mind and physical needs so that he can continue to share an apartment with his wife. I have this blog, the physical fitness program, and the monarch butterfly project. We still have 250 cubic feet of storage full of boxes I find difficult to sort and pitch.

“She does not seem to mind me or care about me any more.” I told him how we have visitors come to the common area in memory care. We greet my wife and then sit down at a table where she can see us. In time she will come over and visit. In time she will get up and continue her trademark activity of randomizing everything she can pick up. In time she will again rejoin us. She is in her world. We are in ours. At times they mesh.

She is fully aware of what is being said, but with a very limited past (immediate and distant) for referencing, finds any discussion meaningless with the exception of the current moment; unless there is sufficient repetition or time for her to switch between different clocks.

[Caregivers take advantage of this situation by timing diversions and distractions to fit into that two to five second space between clocks (fixations on activities). A skilled and experienced caregiver can anticipate these changes between fixations that run on different clocks. This is the main reason you want the same effective caregiver as much as possible.]

For those who can, our task is to take part in and build an environment in which we, and our spouses, can be as happy as possible. My wife and I did that in our home for a year with well-matched Home Instead caregivers three times a week. My back problem put us in residential care. We are still building the best environment here in our apartment, the common areas (indoors and outdoors) and in the fitness center (gym).

[I was up before 5:00 am this morning to write this. I have the iPhone set to ring after 20 minutes. Time to get out of this chair. Next to find a repeating timer or chime I can set for 25 minutes (20 for work and 5 for exercise) as I forget to restart the iPhone timer. This is just one more step in creating an effective health care program.]

[StretchClock allows me to set the time between short stretching exercises: 25 minutes of work and a 5-minute set of yoga exercises (stretching as we do in the fitness classes), for example. I do not have to remember to reset it. Google “repeating looping timers” for dozens to select from.]

A Most Unusual Day

(Written two months ago.)

My wife woke up under the control of the “worries”. We used to call it that before we heard of “sun downing”. But the worries happen at any time. It has a stern expression, a determined effort, and a quick slap or strong hit if challenged when it is in nearly complete control of my wife.

We needed to leave for her brother, Bob’s, funeral by 10:30. She moved at double speed in packing everything in the apartment into something. There was no interrupting her in her work. There was no time to get out of her nightgown and into her cloths. At 9:00 I discussed our situation with a caregiver. She was ordered out of the apartment with a hand signal.

The business manager (also a degreed caregiver) stopped by with equal success. Attending the funeral was problematic. “She may have been over stimulated at the family gathering yesterday evening in the (partially restored) Hearth Room”. (A group of 15 relatives lasting 3 hours from which she left in her usual way about half way, “Time to go.”)

Now several other caregivers considered a calming pill. By now even drawers from my old clothes chest were resting on the sleep number bed next to the bathroom. This has never happened before.

Packing even the Pillows
Clothes Chest Drawers

I continued without forcing her to get changed or to leave things in place. I did put many things back only to have them migrate again. And then at 9:30 she sat down to rest. No order, of removing or dressing, one would normally use had worked.

And then again, “We need to get dressed to go to church.” “Oh!”, in that soft voice of recognition and understanding. The calming pill was ordered. I held out her pants. She put them on. “Lets wait on the pill.” Socks. Shoes. She put them on. The worry spell was over. No medication needed.

There was no taking off her nightgown. No putting on her brassier. I next held out her blouse. Off came the nightgown. On went the brassier followed by the blouse. I have to get things in the right order in her world.

When we stood to sing a hymn, she saw two of the picture books her younger brother and his wife made of Bob’s life, in the pew before us. One has a high school picture and the other a collage picture on the cover. She again showed for a few seconds the same reaction as when I was finally able to tell her that Bob was gone.

I had shown her Bob’s picture on the TV that was posted on Facebook yesterday, by a family member, and then asked her if she knew who that was. “Yes, Bob”. “Now read what is beside the picture.” Obituary . . . .  A two second winch of anguish and then back to the present.

The service seemed uneventful for her. The slide show afterword did connect. Between about the third and fifth showing she watched intently and responded to many of the slides that are in the family reunion picture books that have been made for us. 

(These picture books tell a story as will as bind a collection of pictures that appear to be able to withstand a lot of use for her and for sharing with all the residents.) [They are perfect for memory care.]

She responded well to a large number of people we knew well. I have been told several times that this may just be an act. It may be, in part, but she never asked to leave the service.

The dinner after the service was a second crowd. We stood still looking for seating. A complete plate was placed on the table in front of us and my wife was directed to that chair. My wife never asked to leave.

We ate supper in memory care while other family members visited restaurants. She was content visiting with our two sons afterwards and with their departure for the airport. Everyone seemed in good spirits.

This is then another time in which my wife has gone from “highly agitated and over stimulated” to normal behavior solely in response to not forcing her to perform by the clock. At no time did she jump up, “It’s time to go”, or signed, “No. I am not doing that.”

She has spent almost three hours playing with her keepsakes this evening. At 9:00 pm she is still not ready to let a caregiver help her into bed. She is now busy putting a few things right in the apartment rather than randomizing them. (I know this happens in the night at times, but have never seen her do it before.)

A most unusual day made possible by a number of family, friends, and caregivers. A thank you to each one.

This day presented the interplay between skilled, radiant, caregivers at all levels and my wife’s behavior at any one time. A significant time period can be as little as two seconds. The same behavior can support many stories; all of which can be wrong and all of which can be true for a moment.

- - - - - - - - - - -

Bob’s wife passed one month later. She was watching TV and playing solitaire. She was Bob’s Alzheimers caregiver for over 10 years.

Sunday, May 21, 2017

Sitting Correctly

"Sit up straight." " Relax." How is that possible? What does it feel like? How can it be done without a trainer observing you?

After almost a year of nearly daily classes, I am beginning to find answers. The complete answer comes when you can do this by yourself.

For decades I thought I was sitting up straight. Then I found the sitz, sitting,  bones. Then I became aware of where my shoulders should have been. And lastly, I learned to balance my head, relaxed.

None of this could be done until I could sense, feel, something related to the right and wrong way of positioning, one muscle at a time. This sensation can be the same or different from pain. Pain sets the 
limits for that day.

Pain is tricky. Where one feels pain can be far removed from the cause. Several causes can produce the same pain.

My experience with weigh training, chair yoga, and tai chi has provided three views of the same situation. “If it hurts, stop. Stay within your pain free zone. You can go further in the next session.”

The reason for caution is simple: Irritated nerves, muscles and joints may take several days to heal before progress can again be made in training these parts.

We cannot sense body parts and movements at the lower, quieter, level needed to experience training that is appropriate for seniors, if pain is present.

[I attended my first meditation class yesterday. This now provides a full set of experiences from feeling great to physical pain and to mental anguish.]

So, how to sense sitting up straight and relaxed? The answer borrows from all three [four] training methods.

Sit in a hard chair to make it easier to sense your sitz bones. Mine immediately hurt. I therefore use my vest as a cushion in class.

Roll back on your bottom to feel your tailbone. I don’t feel mine, but this is not sitting up straight. It is how I have been sitting for decades to avoid pain from my sitz bones.

Next to stack your backbone in the correct relaxed position. Start with sitting on the sitz bones. Then to find where “up straight” is.

Lean to the right. Center. Lean to the left. Center.

Lean forward. Center. Lean backwards. Center.

Repeat as needed to get all four centers at the same place.

Lift your shoulders as high as you can and then DROP them. Repeat 2-3 times.

If all goes well, you are now sitting up straight and relaxed, except for your head.

Relax your neck. Your head will probably fall forward. Repeat the above four centering motions with your head. Find the point where your head remains balanced on your backbone. This may require positioning your neck as if your head is being pulled up by a string.

Take a deep breath, fully expanding you chest. Sense how this alignment feels for several seconds. 
Repeat 2-3 times.

Now stand up as a proud owner of a properly aligned body. Practice walking this way. I back up to a wall for realignment in the hall when I feel I am loosing my proper balance.

The body and head centering motions are both stretching exercises and show you where your proper posture is. Practice establishes this position in your muscle memory. Pain related to improper posture may be eliminated or reduced for a period of time. Your attention is being diverted from pain to learning how to feel good.

The most frustrating part of this is to be totally pain free for minutes to hours and then have it return with such intensity as to almost take me off of my feet. Such a violent return generally takes place as I am walking down the hall in memory care. I have yet to fall, but my right knee can buckle.

Or the back pain starts as I lure my wife out of our apartment. That can take up to 15 minutes for her to touch and set everything in place, or a caregiver comes by and assists me.

Allergies, stress, improper posture? Plastering and painting? At any rate, the fitness classes are allowing me, in general, to fee good by the time each one ends. Each new set of exercises seem to make something snap in a new location in my back and then feel better.

Thursday, April 27, 2017

One Month at Home Again

We sorted out the apartment yesterday; 12 hours, and more time to put away everything today. We found enough silverware to set all the tables in memory care once again; and half enough napkins.

We did not find the TV remote (suspect it has been taken to the common area) and two seed starting plugs (just found them when I got into the bathroom cabinet this morning).

My electric toothbrush was missing last night. I found it in less than three minutes in the keepsake shelf. We are about set up here as we were in South Hampton Place where important stuff was locked up and the rest could be found in less than five minutes.

Three of the large clear plastic tubs that fit under the bed will be in storage. Our two worlds can again exist in the same space.

Three days ago I woke up feeling great. This happens a couple of times a year. It gave me the energy to get my wife’s keepsakes organized enough that she can play with them again. It is no fun to play dominoes if there are one or two dominoes in very container, of all sizes, in the apartment.

I also ended working on investing the money credited to our account because of the December flood at Provision Living at Columbia. I hate to be forced into making decisions when I do not have all the available facts. I don’t mind the unavailable facts as they can be easily created as needed.

One noticeable change in the whole memory care group this past month is that they seem to be calming down; perhaps even slowing down. Our two travelers, who spent hours discussing walking, driving, hitch hiking, sharing a ride with their car, truck or motorcycle (which neither had) during our two months at South Hampton Place, rarely even mention these plans now.

Falling is still our number one enemy. One resident fell, broke her hip, hospital, rehab, and back while we were refugees. She has been moved to the apartment closest to the activity area, is under continuous watch, and restricted to a wheelchair. She is just unsteady. We now have three or four caregivers watching (working with) about 16 residents during the daytime and two all night.

The fitness classes emphasize getting up and sitting down and balance (fall prevention). For these classes to be effective, residents must practice a number of skills repeatedly until they are part of “muscle memory”. I discovered this happening to me after one or two classes a day, five days a week, for the past month.

The down side of summer coming on is the tobacco smoke (an unresolved issue in the entire residential “health” care industry in Columbia). With the patio doors open to the north and the windows open to the south, the smoke comes in strong enough that the caretakers on duty quickly close the patio doors.

Only twice in 16 months has this been strong enough to trigger one of my allergy reactions that is specific to second hand smoke; that can be a “stop in your tracks” spasm in the lower abdominal area on the following day. My nose becomes congested from being too close to smokers who return too soon after a break. Dust from the continuing repair of the building is also a problem; some four months after the flood, that should never have happened.

It is now 10:30 am. My wife has finally started putting things into “her” under-the bed plastic tub. 

The wastebasket is under my desk out of her way with me sitting here. Otherwise she will redistribute the contents or, as at the hotel, pack it full of anything that remotely fits.

For most of the time we have been in residential care, if the day turned sour it stayed that way for the rest of the day; the exception was a ride in the car. Now she can switch from one to the other in a matter of minutes for no observable reason, any time of day.

The missing sheet returned
She can also find things. Not at the moment, but 20 minutes to two days later. This delayed response also shows with her cloths. No! And a few minutes later, after the caregiver has left or I turn to working on this desk, she does the very thing that needed doing.

I printed out two sheets of paper; went to the bathroom for something; returned to find the top page missing. A 5-minute search failed. We talked about this for a while. The next time I returned to the apartment, the top page was back.

She had a blouse over her nightgown. “Lets take the blouse and nightgown off” “We will put the blouse back on.” “OK?” NO! [Time for several variations of this.] It hit me, get a third blouse. “Lets put this on.” She immediately removed the blouse and nightgown, and put on the third blouse. [3:00 pm and we have the same situation except now she still has the nightgown on.]

She is ready to fight her way out of memory care at times that do not seem related to finding me. We ended up near the door as I was going to a fitness class. I sat in a chair. We talked. Several people entered and invited my wife to go with them back to the activity areas. Then one came from the activity area and asked, “Would you like a treat?” The puzzled, belabored expression on her face vanished. She took off faster than the caregiver. We just need to find the key that unlocks the “worry’s” grip on her.

Pills are now routinely offered in the normal fashion with several variations, including me. Next in ice cream or chocolate pudding. Next the caregivers check to see who is on duty, at the top of the peck order in successful attempts.

A short term calming pill is very rarely used (less than once a week). Most often, we change her environment after two hours randomizing our apartment or after shorter times elsewhere.

I found her the other day seated with her family-tree book and the mechanical cat in the activity area. She was calmly waiting for me to return from a meeting. This had been arranged to resolve a confrontation at the door.

Time to find a Monarch butterfly feeder for our window. Seems they like Gatorade and Juicy Juice.

Thursday, April 20, 2017

Investment Damage Control

The last meeting we had with an attorney and a financial manager 14 years ago, when we set up a non-revocable special needs trust for our daughter, was devoted to playing the devil’s advocate. “Lets review everything that can possibly go wrong with what we have written down in this will.” Now to do the same with the S&P 500 ETF reviewed in the past posts.

On the positive side, we have been advised that we may not run out of money living in residential care. We may not have to qualify for Medicaid. There may be an estate more than having everyone gather at Orange Leaf for a treat of his or her choice.

A prior post establishes that even with a 10% decline in the S&P 500 ETF, it can recover in between 2-3 years on average. The 5-year CD time span can be divided into two periods (of 2 1/2 years each) for comparison with the stock market.

Lets assume that half of the investment is unexpectedly needed at half way to five years. (An expected need would suggest a 2-year CD.)

CD damage control could be to invest in two 5-year CDs; save the $10,000 pot in two fractions. The cost would be one year of interest any time after 10 days from purchase ($5,000 * 2.3% = $115).

Stock market damage control could be to sell $5,000 of shares at a cost of $6.95 per trade. This assumes no change in share price. (This ignores the option of selling less than $5,000 as needed.)

The two above short term methods of damage control do not include the dynamic nature of the stock market. The CD is totally predictable. The ETF is subject to short term and long term trends that occasionally erupt into sudden large rises and falls.

The current 5-year CD earns 2.3% interest. The expected yield on the S&P 500 ETF (dividends and normal increase in value) is about 6.0%. Buying a CD is damage control, for the ETF,  costing about 4% from day one. (The CD is needed when there is insufficient time for the stock market to recover from a decline.)

S&P 500 Dividends
The S&P 500 dividend yield provides a tricky insight into the stock market. The years of high dividends are also the years of low prices ($2/$50 per share = 4%; $2/$200 per share = 1%). The entire historical trend is to a lower dividend rate (%) because of a higher share price ($).

And then something that has always bothered me is the way price is marketed. A 50% correction ($100 * 50% = $50 but is then listed as a 100% increase ($50 * 100% = $50; $50 + $50 = $100). This extreme change only happens if you sell and buy. Investors hold. They see a decline and then a recovery of 50% (-$50 + $50 = zero change in the pot). There is no 100% increase.

I interpret the statement that 2/3 of the time share prices were above 20% or below -10% of the average, also reflects the change in basis when prices fall (from the full pot) or rise (from the residue of panic selling).

A second insight, from the above post, into the nature of the stock market is the variation in prices. Only five times, in the past 42 years (12%), has the market been within 10% of the average. This makes sense. The stock market is a free wheeling system that tends to “hunt”; to overrun before changing course (like someone learning to balance on a bicycle).

This is normal human nature. The search for profit slowly drives prices to their maximum. Fear of short term loses, drives prices to their minimum, as people leave the market. I have found a number of ways built into the process of trading that limit loss and that take a profit before the price falls again. These devices become increasingly important as time to sell is reduced from twenty years (investing) to one minute (gambling).

So, CDs or S&P 500 ETFs (2.3% certain or 6.0% on average)? How long one has been in the market has no bearing on how to exit the market. (You expect to have more money, the longer you have been in the market.)

Waiting Period for Price Recovery
There seems to be no way to pick the best time to enter the market. But there is clearly a best time to exit the market: when you sell at a profit. My estimate is that waiting period, for an optimum time, can be around three years.

So, at 2 ½ years the unexpected happens. The 5-year $5,000 CD at 2.3% compounded interest for 2 1/2 years, minus one year of interest, yields ($5,293 - $115) = $5,178 for a gain of $178.

As an ETF, the $5,000 would earn, on average, $786 (6% total expectation). The increase over the CD is about $600 or $240 per year if all went well, about 12% of the time. The price for damage control by selecting CDs rather than ETFs, on average, would be $20/month.

Assume the market fluctuates +/- 10% ($500), as it, in general, does; the resulting yield would be between $286 ($786 - $500) and $1,286 ($786 + $500). Even at 2 ½ years, the ETF could be expected to match or exceed the CD, on average.

At five years and no damage, the two, $5,000, 2.30% savings CDs yield $11,200 with limited risk; the ETF is estimated to yield $13,380 for a difference of $2,180, on average, for taking unlimited risk. (Or lose $2,180 if all goes very badly on exiting the market.)

If we anticipate the unexpected, we buy two 5-year 2.30% CDs. If we do not anticipate the unexpected, we invest in ETFs with the expectation of more than doubling the return from the CDs down to an equal yield, on average (assuming an exit period of up to three years, a limited sell order, and a good credit card).

I have laid out the playing field; now to watch one of the many games being played.

Sunday, April 16, 2017

Time to Enter the Stock Market

It is time to put our money down. Internet brokers make this easy to do.

From here on, I will try not to serve as an advisor, but as a guide to where I have been and how anyone, including myself, can continue to learn what is needed as each investment situation arises, to comfortably, enter, remain, and leave (profitably, I hope) the stock market. (Even if you do not put money in, you can still learn to save, invest, and gamble with a trading game.)

1.    Search
2.    Click Invest Your Way
3.    Scroll to the bottom of the screen and under Research, click ETFs
4.    Hover over SPY (lower right side of the screen under Most Popular ETFs)
5.    Click Interactive Chart (center of popup screen)
6.    Look around the S&P 500 ETF chart.

You will find something different than the chart I have here. My chart is capturing some of the human aspect I have stumbled on to. Also see Investopedia for an understandable perspective of terms.

The story I have found goes like this: After each large decline or correction for whatever reason, investors and gamblers become accustomed to what at first was really uncomfortable. Investors hold steady.

Traders start to take bigger gambles that pay off more. The market becomes more and more fragile until almost anything that formerly had little effect brings down a new correction and a new buying opportunity for investors.

What is worrying people? Why has the several year bull market stalled again in the past few days?

The Mood or Comfort of the Stock Market
Click the blue spots with an N to show the news that people may have responded to and perhaps will continue to respond to. Every bend in the closing share price (red line) has an N flag during the last week. Something has the world concerned.

During the past month the two blue lines have declined; at first both lines. Then the lower line has declined even more. This is an indicator of a bear market. Then a week later, the upper line also falls. It is a bear market.

The market changes from bull, money flowing in and prices rising; to bear, money flowing out and prices falling. I would like to enter the market at the end of a bear market where I can buy the most shares for the pot I have in hand.

The two blue lines show averages of the highest prices and the lowest prices during each day. If people are willing to sell at a lower price or unwilling to buy at a higher price, it makes sense that people are uncomfortable with the situation they find themselves.

The stock market is like many other systems. Slow change is easily tolerated. A quick change can wreck havoc (our flood in Provision Living at Columbia after two days below zero); that ended up with us having a pot to invest. A large drop in the market does the same for many people but is also the time for others to buy. Every trade takes a buyer and a seller. We just need to be in a position that share price variations are to our benefit.

This is Easter weekend. The market is closed. I Googled the European and Asian markets just now to see that they are all down. Is it time to put our pot into the ShareBuilder plan that invests every dollar we put into the account each Tuesday? Or should I wait anther week?

7.    Click transfer money from bank to invest in one lump sum or in periodical deposits (Pending).

Now I too am a gambler. The first choice favors a price rise, for a $3.95 trade. The second choice favors a price drop, for a $3.95 trade each deposit. The third choice is to just wait a bit longer for a lower cost of a share:  A lose of about $2.00/day waiting vs. a decrease of $100/day cost, when buying shares, for each 1% in market decline. [Lucky trading makes money faster than dividends (1.92%) or CD interest (2.30%)]

To see my chart on line:

a.    Click Chart Style and select either Mountain ($, default) or % change.
b.    Click Events and select N for news.
c.     Click Technical Indicators and select Price Channel (bull & bear).
d.    Click 1m at bottom of screen for one month.
e.    Click Frequency: 1 Day.

The expense rate for a transaction is calculated for you ($1000 less $3.95 = 0.40%; $10,000 less $3.95 = 0.04%). A periodic investment of $100 would cost 4% of your money to enter the stock market. (That leaves 2% yield the first year, the CD rate, and 6% thereafter, on average.) There are no other fees or charges until you sell your shares ($235 per share this week with a $6.95 cost per sell of any number of shares.)

One reason for selecting Capital One Investing for this example is that it spans the full range from savings to investing to trading (gambling). Even starting at $100/month makes sense given the depressed interest rates on long term savings.

Saturday, April 15, 2017

Entering the Stock Market

A 20-year chart of the S&P 500 ETF shows the money you invested in 2009 would have more than doubled in value by now in 2017. No CD can do that today.

The CD has no risk today other than failing to keep up with inflation. At the end of five years, the result can be the same buying power as when the CD was purchased.

(The new rate for I Bonds, starting May 1, 2017, was set at 1.96% yesterday. That is 0.8% less than the last six months, $2.76. It has a three month penalty if cashed before five years. That leaves Bank CDs and the stock market to consider.)

The Exchange Traded Fund (ETF) is an invention that reduces risk when investing in the stock market. The S&P 500 ETF averages the results of the 500 companies in the S&P 500 index. The long term average is about 6% per year when dividends are automatically reinvested. That is much higher than 2% for CDs.

Compare CD and S&P 500 ETF
The comparison chart shows the return on savings CDs (only interest at risk on renewal, red line) and S&P 500 ETF shares (with the invested pot and dividends at risk daily, solid green line).

There is no way to accurately predict the price of shares at the time we invest. I set a 10% limit on possible gain or loss. If all goes, as most likely, the 5-year CD will be worth $1,120 (red) at 2.3% currently being offered. The shares of S&P 500 (solid green line) would have a value of $1338 after five years.

However a 10% loss at the start would yield $1,204; a 10% gain would yield $1,472 at the end of five years. If the gain or loss occurred later than the initial investment time, their lines would depart from the most likely (green line) to the dashed lines.

[Cashing an immature CD at four years yields about the same amount as a mature 3-year CD (1.60%, which is near current inflation).]

Time is now needed to recover from a decline in share value. In this example the value of shares at two years will equal the initial value of $1,000 with a 10% loss on entering the market. At three years the shares will equal the value of the 5-year CD if cashed at four years. At five years the shares will exceed the value of the CD and of current inflation ($1,204).

Time to recover is a normal part of the stock market. Time manages risk. Therefore we do not invest in the stock market if we need the money sooner than time can bring prices up to expectations. In this example, it takes about three years for the ETF to catch up to the 2.30% 5-year CD given a 10% loss.

There is no cost to the act of buying a CD. Capital One Investing charges $3.95 per buy, any amount of shares or dollars, and $6.95 per sell any amount of shares.

Investing in the stock market is still problematic. My wife has again, as I was typing this, defeated the security system again, for starters.

Also if I have learned anything about the stock market in the past two weeks that I have been working on this; this emotion, fear driven, engine is more apt to proceed as a bear market with lower priced shares than a bull market with higher priced shares. We will see if that bet is true next week.

Thursday, April 6, 2017

Tornado Drill

Yesterday we were to have a tornado drill: at 10:00 am. But the city does its monthly tornado horn test at 1:00 pm. It rained. By 1:20 pm it was evident there would be no tornado drill. The horns are not tested when people may think the test is for real.

The handout at breakfast only stated, "residents are to go to their bathrooms". We need simple, specific, effective directions to be in a safe spot that is conveniently designed into the building.

Provision Living at Columbia was marketed with concrete walled tornado proof stairwells. True. But the architect(s) put nice windows in the upper floor stairwells. Flying debris can take out any window in the building (the only tornado risk I can find in the building).
The Safest Spot

The two and three story building is in reality a collection of small brick-faced homes built on heavy concrete slabs resting on solid porous Missouri limestone. It is not going anywhere with a concrete wall between every two apartments. There has never been an F5 tornado in Boone County, Missouri, that could move it. There may never be one.

The brick facing offers (but does not guarantee) total protection from F1 to F3 tornadoes. There has never been an F4 tornado in Boone County.

The safest place in each apartment then, is sitting on the stool in the bathroom. Any projectile entering the room must pass through two closet walls (and all your clothes) and any furniture you may have placed against the closet wall.

The structure itself should protect everyone with the exception of breaking glass and flying debris.

Safe in Shower
Safe on Stool
                  Not Safe in View of Window


We need at least one internal wall to provide residents protection from an F3 tornado (only one F3 tornado has occurred in Boone County in the past 50 years).

(A closed bathroom door provides protection from flying glass and debris, if the resident is not sitting on the stool, in the area beside it, or in the shower.)

My proposed revision of the handout for the next tornado drill:

At 1:00 pm, dd/mm/yyyy, Provision Living will be participating in the city-wide tornado warning test.
There will not be an internal (fire - flood - evacuation) alarm, and no need to listen for the alarms outside.
Be sure all staff know and inform all residents so they know what to do when the test happens.
Once the warning begins, residents are to go to their bathrooms (or directed to a designated area).
Sit on the stool or the shower bench (out of sight of the window or close the bathroom door).

Monday, April 3, 2017

Saving and Investing Risk Management

In the previous three posts on saving and investing I tried to ferrite out the relationships between a number of common ways of holding money until it is needed. It is always cheaper to borrow from our own savings than from a credit card.

The Christmas savings account is a good example. You earn pitiful interest during the year, but escape a 20% credit card bill during the next year. The account has served its overall purpose. You are earning interest at a rate of 20% for as long as you would have had to pay on your credit card balance.

Now, if we keep this same line of thinking for CDs, the 2% rate is also low, but much lower than the rate we would have to pay on a credit card health care bill balance (20%).

The CD carries zero risk. It is government insured by the Federal Deposit Insurance Corporation (FDIC). Even at an up to a 2% interest rate, buying a CD has not been a valid investment practice for several years. It has not been keeping up with inflation. In that respect the CD is not safe. When it matures it buys less than when it was purchased.

I have found more than one source stating that interest rates are strongly related to inflation rates as well as to government agency manipulations for political and financial reasons. CDs do have zero risk for short term savings.

Comparable CD Payout Rates and ETF Values
CDs have considerable investment risk if interest rates rise and rise fast enough. The fixed return CD lags the open market stock exchange. An exchange traded fund (ETF) follows an index closely; there is little lag. (The S&P 500 ETF was invented January 1, 1993, three years after I was forced to take voluntarily early retirement because of tobacco smoke allergies). Some 20 years have gone by before I learned about ETFs (and I think, finally understand them)!

The 5-year fixed term CD only matures three times (thin solid red line) at which points it equals the comparable ETF values. The ETF values can closely follow interest rates and the funds are always available (less trading costs and adjusted for market fluctuations).

You have to accept the investment risk that is muted by averaging the performance of many stocks in an ETF. The S&P 500, today, yields about 3 to 5 times that of a CD when you accept the risk.

The normal investment risk is manageable by having sufficient savings to bridge the time between a decline and a recovery to the former fund value on the investment. This is pure math and probability. You lose nothing if you do not sell during a decline.

It has little to do with your risk tolerance, trading habits, and investment advisors (who currently can charge more than your investment is making). Fortune tellers, around the world, do a good business doing what investment advisors do here in the USA.

Since investment advisors cannot predict the future (and their contracts relieve them of any liability from following their advice), you need a balance between fixed rate low paying CDs and variable rate, much higher paying, ETFs. How much of your ETFs are you willing to lose if needed to sell on a short notice (less than a month)?

Or can you charge unexpected costs to a credit card with a low interest rate, far below 20% if your CDs cannot cover the cost? You can if you have a good credit rating. And then, possibly, pay it off at the next billing with no interest cost.

CDs and ETFs complement one another. You save and invest starting with CDs. You gamble starting with ETFs. Now to live long enough to see how this all plays out. (We bordered on gambling when we bought the annuity from our house sale and moved to Provision Living at Columbia. They were best buys a year ago and still are.)

An afterthought: Holding money to fill in a decline in an ETF is, in effect, being a self-insurer. Then buying CDs with that money, where it earns some interest, makes the CDs the secondary insurer. This makes sense; a common investment practice. It makes a decline in an ETF, a planned for unexpected cost, that the annuity cannot support along with other unexpected medical costs.

Saturday, April 1, 2017

ETF Index Mutual Fund

I have found that an index fund holds a collection of stocks and bonds that mirror the behavior of what ever is being indexed; in this case and exchange traded fund (ETF) following the S&P 500 index. Any increase in the S&P 500 after buying in, is a profit. Any decrease is a loss. Funds left in the cash managed account (CMA) and not invested earn nothing.

The ups and downs of each of the 500 companies is averaged to produce the current value of a share in the index fund. This guaranties that we will neither get the highest gain nor the highest loss.

Bank of America was “forced” to buy Merrill Lynch by federal authorities at the start of the Great Recession. Their on line stock trading is now done under the name of Merrill Edge. I am part way through an over 30-page document on setting up an account to follow the S&P 500 (we do not have green cards or passports).

Now to summarize the costs of using an index fund in relation to CDs. We need to pick a comparable time span. We have experienced few deaths here at Provision Living at Columbia memory care. Several residents have made repeated visits to the hospital and then returned about as good as before. Our unpredictable life span is not a very good factor.

I have already compared CDs designed for one to five year spans and an annuity set for 10 years in prior posts. The contracts are very clear on what we expect in return from what we have saved or invested (about 2% interest at best).

Merrill Edge marketing suggests that we need to consider, at a minimum, a 15 year horizon. Also, “Past performance is no predictor of future performance”; in the short term. The ever-increasing value of the stock market is a valid predictor of the future (but not the bumps along the way). This emphasis on long term has always intrigued me. [It is a key part of marketing and paid advising.]

I know it is based on the effect of compounding interest, but even the past 15 years of compounding is still subject to a decline tomorrow. It is tomorrow (when we may need the money) and the next few years that we must be concerned about; not the past.

To make sense out of the stock market means we must have other funds (CDs, or cash) to have the ability to wait out the recovery. CD interest rates have yet to recover after a decade, but the stock market is doing great, and always has; with enough time. 

[I did not include our annuity with the CDs above, as the marketing of annuities is also questionable. They do not protect us from large unexpected expenses. In fact, they make it worse if the annuity has left us with not enough funds to pay for large unexpected events.]

There is then justification to balance interest rates (that are manipulated by government agencies) with stock prices in an open market. [I-Bond rates are fixed to inflation rates. Years ago we had one that paid over six percent interest. They are now paying 2.76% with a three-month penalty at one year and no penalty after five years. The purchase limit is $5,000 per person per year.]

We need a means of waiting out the next down turn in the stock market, to get involved with it. One way I have found is to invest within our living revocable trust. If the market does go south, and we do not want to take the loss, the trust can continue for a time after our deaths and be managed by the trustee (unless we go broke prior to our deaths).

To put money into the stock market, we need a broker, Merrill Edge in our case. We transfer the funds from our bank account to an investment cash management (CMA) account. We then pay $6.95 per each order to buy S&P 500 index shares. There are nine flavors to choose from; large, mid, and small cap by value, blend, and growth; that range in price today between $69 to $236. We also pay $6.95 per each order to sell shares.

Our trading cost for putting $10,000 one year, with no change in the share values would be $13.90. A 0.01 to 0.03 charge per $1,000 is also levied each time (0.03 * 10 = $0.30). We are now at $14.20.

There is no minimum requirement and no monthly or annual fees with a self-directed account. A guided investment account is 0.45% a year ($45). A select managed account is 0.85% a year ($85). A full service account, as in the old days before the Internet, costs many times more.

The market must go up to pay for all of this, unless only the self-directed account is used. Then $14.20 would be a charge of 0.142%  (0.071% after two years and etc). An average increase in the stock market of 7% (1950-2009) would easily cover this ($700); and a return that is much higher than 2% CDs.

So, a mature CD pays at best about 2% after 5 years. An I-Bond pays 2.76% after 5 years. The ETF on the S&P 500, on average, pays about 6% with immediate access to the funds, if we are willing to wait out a multi-year recovery period or accept a credit card equivalent charge of about 20%.

BUT the loss on CDs, by our own selection, is only on the interest. The loss on the ETF, by chance, is on the entire POT! That is, about 20% x $40 ($8 a year from choosing a 3-year over a 5-year CD) vs 20% x $10,000 ($2,000 any year) with the ETF.

On the topside earned interest is about $40, certain from the CD, vs just 1% (out of an average of 6%) increase on the S&P 500 ETF would be 1% x $10,000 ($100). The stock market is at an all time high. In 10 years it can be expected to be higher.

Day trading and active management of a fund is now a questionable way of investing (unless you are very lucky). Robot management is now coming.

Over 40 years ago this was funny. Each person used the same trading software on his new desktop computer. The market took a fall when many of their computers said, “Sell”, all at the same time. That ended my interest in the stock market. Instead we bought a house.

Every trade requires a buyer and a seller. In general, to make the market work, it needs uneducated, uninformed or unlucky sellers to drop the market beyond “normal” variations from many unknown causes. These unknown causes make it impossible to predict short term events,

I can now understand the pricing structure of safe, limited access CDs, and immediate direct access to stock (highly variable), and to bundled stock, (low variable) ETF funds. The Internet and competition make all of this easy to do and inexpensive.

(I only need to fill out the eight-page application, call a phone number, transfer the funds from a checking account to the cash management account, and order a trade to buy the S&P 500 ETF flavor(s) of my choice at $1,000 per month; I think.

Any free advice or experiences that apply to this are welcome. The I-Bond window will still be open between April 14 and April 29 to give us the choice between the old or new rates..