Saturday Cup of Joe: a lending and tech(ish) newsletter

Friends & Colleagues,

SCOJ91. Well, we are gearing up for a big weekend. The kid is 5 years old on Monday and so we have her party at our house today. Mermaids and magic wands. Strawberry confetti cake and juice boxes. It’s all happening. Hopefully the chaos will distract me from the fact that my daughter is 5. I simultaneously feel like she’s always been around, just kind of a friend hanging out in the house, and that I completely missed her growing up and tomorrow she’ll be moving out. I heard this week that the days are long but the years are short. I get it now.

It’s also the Super Bowl. Is that a big deal? I’m rooting for Eagles over Pats 24–20 but expecting Pats over Eagles 27–24. We’ll see.


Roughly 14 million Americans are expected to call in sick on Monday — making the day after the 52nd Super Bowl one of the biggest sick days of the year, according to a survey by the Workforce Institute at Kronos and Mucinex. Post-Super Bowl Monday is “notoriously known as a day where people call out of work,” with 1 in 5 Americans saying they’ve called in sick over the years. This year is expected to be down from the 16.5 million who had said they planned to call in sick last year.


Here’s a great article about the Winter Olympic sport that I’m most looking forward to — curling. (Though admittedly, I pretty much like them all.)


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Detroit Riverfront at sunset.


What’s gonna happen to SoFi? SoFi announced a deal with Clara Lending to purchase the people and know-how to originate online mortgages. Last year, SoFi originated $12.9 B (with a B) in mortgages, student loans and unsecured personal loans. SoFi is probably best known for its bold advertising, customer-for-life mentality, and aggressive founder. With the founder out and more experienced executives at the helm, it is interesting to try to understand where this goes. With an almost $2.9B balance sheet and indecision about whether or not to form a bank, SoFi has not clearly defined its future. Now, this deal has me asking “What’s gonna happen to Clara Lending?” Perhaps this was a way out and on to the next product; I don’t know. But SoFi seems determined to return to mortgage and try to become a real nonbank player in all products. As banks like Capital One and others exit mortgage, it is interesting to see SoFi lean in.


Included this week:

· Of Interest — 6 people representing the middle class. Compared.

· Power of storytelling — Tell a good story with or without words

· Valuable Lesson — One person’s story of home buying

· For your consideration — The “farmer” that owns all the nuts in California and by extension all the water

· Millennial Minute — Home buyers or home hackers

· NextBelt — Cleveland’s sustainable recovery moving slowly

· Quirky Story — Topographical maps of politics and religion

· Today’s Thought & the Quote


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Detroit, MI, USA. From above.

Of Interest: “Do you think we’re the bottom of the top or the top of the middle?” Brad asked me sincerely. “Does it matter?” I wondered. “Yeah, I don’t know, but I wonder.” At 2 AM, we were asking each other about expectations. What are the appropriate expectations for two smart, talented (if I do say so myself) college seniors looking for the first step of a career path? We quickly discovered that it does not really matter. Certainly for others, equal opportunity is a myth the top of the top tells itself. We had the gall to wonder about it, which in and of itself is a massive privilege. I’ve grown up a lot since then, but I’ve never stopped thinking about the same question as it relates to economic classes. Politicians talk endlessly about “the middle class.” It’s hard to pin down what they mean. Buzzfeed News released a profile of 6 residents in 6 different cities across the country all approaching 30 years old and planning for the future. According to the article, “Today, $75,000 is a statistical gateway to the modern middle class: Though it’s more than what many Americans earn, it’s still not enough to relieve the many anxieties rooted in money.”

Grand Blanc, Michigan to Orange County, California to Nashville, Tennessee to Fort Worth, Texas to San Francisco, CA to Astoria, Queens, NYC.

These 6 people illuminate the balance of quality of life and, specifically, how housing and student debt play a role in almost every decision. Though the article doesn’t draw conclusions or provide a larger “what this means” for our economy or our clients or our peers, the middle class (as defined here) is highly educated, mostly urban and not necessarily diverse. I can’t help but think back to last week’s article about how we’ve focused so much on the paper value of companies and industries that we’re lacking true innovation that will create jobs on a scale large enough to expand the middle class quickly and convincingly. These 6 stories did not necessarily leave me feeling like the middle class is the land of opportunity. I recognize that’s not breaking news, but hopefully we’re measuring our expectations accordingly.


Power of storytelling: A senior leader at my company and someone I look up to sent me a humorous article this week about lawyers trying to deal with emojis and emoticons. The hand-wringing, it seems, comes after several high profile cases have turned on the interpretation of an emoji. As is the lawyer’s way, many experts rush into the mix to train each other and sort out “what we’re going to do?” If you have a Wall Street Journal subscription, I highly recommend checking out the article. But even without the specific cases and stories involved, my takeaway was the incredible power of communication. The ability to weave a story — whether that’s the person in the case who used emojis to communicate their distaste for an aggressive boss or interest in an apartment rental, or the person tasked with crafting a case around the small, smiling pile of you-know-what — makes the difference in someone’s life. An emoji can decide your fate — perhaps not life or death, but employment or contract or financial cases that sometimes feel like life or death. Instead of running away from the ambiguity, I embrace it.

It’s the weirdness, ambiguity and flexibility, frankly, that make life interesting. If emojis are adding to that experience, then bring it on. And I’m not just saying that because it means job security for some lawyers. I’m saying that because life is about a good story and sometimes that story can only be told with a wide-eyed, straight-mouthed stunned-looking face.


Valuable Lessons: Firsthand experience with home buying regret. One area of the home ownership dream that I try to keep in mind while writing these Saturday newsletters is the decision to buy a home in the first place. Home ownership was an eye-opening experience for me (and I worked at a mortgage company the first time we purchased). That’s why reading someone else’s experience with their first home was equal parts sympathy (been there, done that) and hope (they are planning to buy again). Sidenote: the article is also interesting because it’s the home ownership experience abroad.

Here are some of the author’s interesting conclusions:

1. Don’t buy an apartment. If you are going to spend the money and commit, get a house.

2. Consider more options, don’t feel pressure, and actually scrutinize the decision-making process itself, not just the options.

3. Come up with a system to select the next house.

In fact, the author and his partner ranked their desired features, gave each a score, scored each prospective home, and then ranked the homes by score.

In the end, they buy again. The house is wonky and odd but meets so many of the quality of life criteria they had scored, they end up loving it. Moral of the story? How you make the decision is more important to success than the ultimate outcome.


For your consideration: One farmer’s story. Except this farmer is not like any farmer I’ve ever heard. Author Mark Arax compiles a narrative that is really quite something. The story of Stewart Resnick and his wife Lynda, who control California’s almond, pistachio and pomegranate fields, and as a result, must control the water. The story is almost a book, but it is powerful not just for the profile of this family and what is happening in Central California but also for the writing. I’ve included several excerpts of Arax’s writing:

“Tracts of houses, California’s last affordable dream, civilize three or four exits, and then it’s back to the open road splattered with the guts and feathers of chickens that jumped ship on the slaughterhouse drive.”

“As he bled the aquifer dry, he called on the government to bring him an even mightier river from afar. Down the great aqueduct, by freight of politics and gravity, came the excess waters of the Sacramento River. The farmer moved the rain.”

“No stranger enters this zone unless it’s to get rid of a body or dump waste from cooking meth or drown a hot car. Its vastness makes you feel safe and in jeopardy at the same time.”

Really beautiful and painful imagery.

He also writes about a scale and industry that I didn’t have any experience with, and so some of these facts and figures were astonishing.

1. [Resnick’s companies] use more water than any other “person” in the West. His 15 million trees in the San Joaquin Valley consume more than 400,000 acre-feet of water a year. The city of Los Angeles, by comparison, consumes 587,000 acre-feet.

2. All told, nine men operating five machines will pick clean this orchard over the next four weeks. They’ll take home $11 an hour for their labors. And how will the Resnicks fare? Each tree produces 22 pounds of nuts. Typically, each pound sells wholesale for $3.75. That’s $83 a tree. By harvest’s end, the Resnicks will have put their clamps on 4.4 million almond trees. Nearly $365 million worth of Wonderful almonds will have dropped down from the dry sky.

3. All told, 36 men operating six machines will harvest the orchard in six days. Each tree produces 38 pounds of nuts. Typically, each pound sells wholesale for $4.25. The math works out to $162 a tree. The pistachio trees in Wonderful number 6 million. That’s a billion-dollar crop.

If you have a chance, check out the full story.


Millennial minute: In case you were wondering what is “so awesome” among millennials these days — house hacking. House hacking is the new name given to the time-tested practice of buying a multifamily house and renting out the other unit(s) to pay some or all of the mortgage. Last generation called it “other people’s money.” We call it house hacking. Either way, this article on underscores the creativity and risk necessary to succeed in the coming years. Last week, I wrote about the savings among millennials; 1/6 have over $100,000. This week, one of the best investments millennials could make with that savings — a home or house hacking.


Next Belt: Cleveland is a tough city to get a handle on. I’ve visited several times since moving to Detroit but mostly downtown or near the Cleveland Clinic and usually not long enough to really get a sense of the city. I know some friends and colleagues that talk about interesting, unique homes, cheap buildings to attract artists, entrepreneurs and restaurateurs, and a revitalization happening downtown. Plus, the Cavaliers did win an NBA Championship. I’ve never really gotten to know the city…yet. Though I have been mail-ordering (or mother-in-law ordering) Slovenian sausage from Raddell’s for 10 years.

As I promote the #NextBelt and my vision that within the next 10 years the “Rust Belt” will be a term of the past, I need to start spending more time in these NextBelt icons.

In the meantime, Cleveland is struggling to strengthen the neighborhoods immediately surrounding the city, so-called inner ring suburbs. The idea was to eliminate blight and allow people looking for good houses near the city to return. Aided by the county, the Cuyahoga Land Bank and federal money, the suburbs have razed hundreds of dilapidated houses. With buyers and developers, they’ve worked to rehabilitate a similar number of properties. Slowly, progress is being made in the city. The value of real estate has started to tick up. Unfortunately, prices in some of the suburbs — more specifically, certain neighborhoods in every suburb — remain strikingly low. What makes one neighborhood or area rebuild or take off or become cool, while others do not? There’s no shortage of opportunities for home ownership in Cleveland. The question is whether anyone will see the value in buying in now.


Quirky story: Mapping political and religious faith…a topographical study.


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Today’s Thought: I’ve often heard you are the average of the 5 people you spend the most time with. Do you agree? If that’s true, how does that apply at work? If you are not responsible for the 5 people you spend the most time with, does the result still hold true? My assumption has always been that people tell you that you are the average of these 5 people to remind you to select friends who will be a positive influence on your life. But if the theory is true, what does that mean for work? Are you the average of the 5 people you spend the most time with in your office? And if that’s true, what does that mean for you?


Quote: “As long as you live, keep learning how to live.” — Seneca

Bonus Content: Several great links for photos this week: Photo essay of Puerto Rico & The Ghost Towns of Spain built, in part, to try to attract Hollywood westerns.

Continue success,

Written by

Thinker, curious leader, once an attorney…always trying to answer well.

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