Category Archives: Chubby Rules

Billy the Bully

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by Greg Hague

Life lessons from Chubby (my dad) and other smart folks I’ve met on the road.

bully

Age 13 – A tough time in my life. Overweight. Oodles of freckles. Pimples galore.

The kids were incessant, brutal, day after day. The worst?

Billy Rogers. Big bully. He never let up.

Billy smacked the back of my head whenever he walked by my desk. One day he jabbed a pencil so deep into my arm I had to go to the school nurse to have the lead dug out.

Billy’s favorite taunt?  I heard it thousands of times and recall the words to this day – “Fatty, fatty two by four, can’t get through the bathroom door.” Often, he’d recruit others to chime in.

Today’s schools wouldn’t let Billy get away with this stuff. Things were different back then.

Of course Dad knew, and how awful he must have felt. As a caring father myself, my boys’ pain is like a lance in my heart.

One Saturday he finally asked,

“Greg, the kids are giving you a hard time at school, aren’t they?”

(I remember how embarrassed I was. This was not something I wanted to discuss with my father.)

“Yeah Dad, they tease me sometimes, but it’s no big deal,” I replied.

(Of course the “no big deal” part was a ridiculous lie.)

What Chubby said next changed the course of my life.

“Greg,” he said sternly, “you need to send a message to every kid in that school…and Billy Rogers – you need to beat him up BAD.”

Beat him up bad??? Like physically bad? Words from my dad?

“You want me to beat up Billy Rogers?” I said in utter surprise.

“Yes,” answered Chubby. “And I want you to do it Monday morning.  I’ll drive you to school before the school bus arrives.  When the bus pulls up, you’ll hurry over to the door as it opens. When Billy steps off, hit him as hard as you can right in the face.

Knock him down.  Jump on top.  Keep swinging.

Don’t stop until someone pulls you off.”

“But Dad!” I exclaimed (with a trembling voice). “I’ll get punished…I’ll be thrown out of school!”

“Don’t you worry about that,” Chubby assured. “I’ll take over from there.”

“We’ll go to the principal’s office together. I’ll give her a piece of my mind. There’s no excuse for letting that brat pick on you.”

“Can’t we just go to the principal first?” I pleaded.

“Absolutely not!” Chubby angrily replied. “On Monday, Billy the Bully will bully no more…”

Tomorrow, as Paul Harvey would say, “The rest of the story.”Kids Boxing

 

The Lure of the Distant and Difficult

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by Greg Hague

Life lessons from Chubby (my dad) and other smart folks I’ve met on the road.

difficult

“Greg,” Chubby advised. “The smartest thing you’ll ever do is surround yourself with people smarter than you.”

When I met Bruce, I knew Dad was right.

The definition of smart? Bruce.

A few years ago I was talking with Bruce about one of my entrepreneurial visions. BOLD. AUDACIOUS. A game changer, for sure.

Bruce listened with intensity, a glow in his eye. Excited? No doubt. Then he spoke up, “Greg, I think your idea is remarkable. But why?”

“What do you mean?” I asked.

“Why is this something you want to do?” he answered.

I didn’t get it. What did he mean? Bruce said he thought the idea was remarkable.

Bruce continued. A different perspective. And he was 100% right, “Greg, the lure of the distant and difficult is often deceptive. Your idea is bold, audacious, maybe even a game changer. But you missed one thing, IT’S REALLY HARD!”

Bruce was right. The project would be very difficult. It would take a huge investment of time, money and drive.

Bruce continued, “Greg, I know you LOVE challenges. You have a burning desire to conquer, to prove yourself. I respect that. Just be careful that your ‘go for it’ attitude doesn’t make you travel far to find hard when easy is right at your feet.”

What did I learn from Bruce that day?

The lure of the distant and difficult is often deceptive.

Look for great opportunities where you are now.

easy way hard way

A Tip of The Cap

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Life lessons from Chubby (my dad) and other smart folks I’ve met on the road.

risk reward

“Cap rate?” I asked. “What the heck is that?”

Chubby laughed. “Greg, it stands for capitalization rate. It’s a way to value rental real estate.”

“But Dad,” I said. “You once told me real estate values were determined by comparing sales of similar properties.”

“That’s true with homes,” Dad answered. “But with apartment buildings, office buildings, and other income producing properties, cap rate is more commonly used.”

“Can you explain?” I asked.

“Greg, suppose you are choosing between an older apartment building in a high-crime area or a newer building in a nicer area. You would certainly want a higher return on your investment as an incentive to buy the older building. That means the price would have to be lower or the rent higher.”

Dad could see the perplexed look on my face. He continued,

“Presume that each building generated the same $20,000 a year in rental income. You might be willing to pay $200,000 (10% return) for the newer building but only $100,000 (20% return) for the older building. Those percentages are cap rates – the return you demand based on the desirability and risk associated with the property. As you can see, when the cap rate goes up, the property value goes down.”

 

What did I learn from Chubby that day?

Capitalization rate is the percentage return buyers expect based on the desirability of the investment…. a lower return on nicer properties, a higher return on less desirable properties.

 

To determine the value of a property, divide this percentage (i.e.10%) into the annual net rent of the building (i.e. $20,000) to arrive at market value (i.e. $200,000).

 

Don’t feel bad if you have to read this again.

roi

 

High Finance and Me

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Life lessons from Chubby (my dad) and other smart folks I’ve met on the road.

financial statements

My first car. I needed a loan. Who did I ask? Chubby, my dad.

“Financials,” he said.

“What?” I asked.

“I need your financial statements,” Dad replied in a matter of fact tone.

“Why?” I responded. “I’m your son. It’s not a big loan.”

“That’s not the point,” Chubby replied. “Greg, you need to learn about loans. Your lender won’t always be me.”

“OK,” I said with a touch of chagrin. “What do you want?”

“That’s what I thought,” Dad said while nodding his head. “You don’t understand financial statements, do you?”

Chubby was right about that. I vaguely knew, which to Dad meant I didn’t have a clue.

“Greg,” Chubby explained. “When lenders ask for financial statements they want two things; a balance sheet and an income statement. Let me explain:

A BALANCE SHEET is a picture of your financial condition at a moment in time, generally a specific date.

For example, if today you have $400 in the bank, $100 cash in pocket, $300 in clothes, and $200 in other stuff, your total assets would be $1000.  If you owe $550 in credit card debt and $25 to your sister, your total liabilities would be $575. That means your assets minus your liabilities equal $425. A balance sheet shows your net equity in all that you own, your total net worth at that moment.

But if tonight you go out to dinner and spend $40, your assets would decrease by that amount, and so would your net worth – so your balance sheet would look different tomorrow.

An INCOME STATEMENT is very different. It shows how much you earned and how much you spent over a specific length of time, often a year.

So, if last year you earned $3500, this would be your gross income for that period. If you spent $600 in advertising and other expenses to earn that $3500, your net income totaled $2900. Because this is a picture of what you earned last year, not where you are today, spending $40 for dinner tonight would have no effect on the numbers.

“Greg,” Chubby concluded. “Lenders look at your BALANCE SHEET to understand what you have that they can take away if you don’t pay the debt.

They look at your INCOME STATEMENT to see your cash flow- the likelihood you’ll be able to repay the debt. Do you understand?”

The lesson I learned from Chubby that day?

I had a lot to learn.

car_loan_application

Log Your Jog

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Life lessons from Chubby (my dad) and other smart folks I’ve met on the road.

running

“Greg, did you log your jog today?” Chubby asked.

“No Dad, what do you mean?” I replied.

“How far you ran. How long it took,” Dad answered.

“No,” I said in a puzzled tone. “I just jog ‘til I’m tired.”

“But aren’t you training for track?” Dad asked with concern.

“Yes,” I replied. “I’m trying to make the team.”

“Then how do you know?” Dad shot back. “Son, if you don’t know how fast you ran today, how will you know if you’re running faster tomorrow?”

I hadn’t thought about that.  A benchmark.  A barometer for improvement.

He had a good point.

Chubby continued, “It’s a critical mistake most people make. If you don’t ‘log your jog’ with school, work, your health, finances . . . the areas you want to improve, how will you know if you did?”

“So,” I concluded with new light in my eyes, “to know I am better today, I need to know where I was yesterday.”

“Exactly,” Dad smiled approvingly. “Why do you think I’ve saved all the real estate ads I’ve written over the years? To read back and make sure I’m improving on each one!”

It was true.  Dad had drawers full of old ads.

What did I learn from Chubby that day?

Log My Jog- keep track of today so I can surpass it tomorrow.

log your jog

 

Broke or Not?

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Life lessons from Chubby (my dad) and other smart folks I’ve met on the road.

“Dad, it broke,” I cried.

“What broke?” asked Chubby.

Chubby Rule merchantability transistor radio

“My transistor radio. The one I just bought at the store,” I replied.

“What’s wrong? Doesn’t it play?” Dad asked.

“It plays fine,” I answered. “But not very loud. I turn it all the way up, but I can still barely hear.”

“Sounds like merchantability,” Chubby said.

“Merchantability?” I asked. “What’s that?”

Chubby Rule merchantability

“The Warranty of Merchantability,” Dad answered. “Greg, when you buy something from a store that normally sells what you bought, it has to work like you would reasonably expect.”

“But Dad,” I said with concern. “My radio was on sale with a sign that said ‘no returns’.”

“Doesn’t matter,” Chubby exclaimed. “This warranty can only be avoided if the merchant disclaims it in bold letters.”

“Really?” I asked. “Does that mean if most would expect my transistor radio to play louder than it does, the store has to fix it or take it back?”

“Exactly,” said Chubby.

“Wow,” I exclaimed. “Does that mean I can get a new radio?”

“Let me listen,” Dad asked. “I want to hear how loud it plays.”

I gave Dad my transistor radio. He held it close to his ear. I had the volume turned all the way up. Chubby turned on the switch.

What did I learn from Chubby that day?

Merchantability . . . and my idea of loud was different than his.
Sorry dad.


Dad Got Mad

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Life lessons from Chubby (my dad) and other smart folks I’ve met on the road.

Casey, Me, Brian, Corey, Jason & Tanner ready to play

Casey, Me, Brian, Corey, Jason & Tanner ready to play

“Greg, STOP!” Chubby scolded.

“I can’t,” I replied. “I’m writing tomorrow’s Savvy Dad. I do one each day.”

“Greg, you forgot what I taught you 50 years ago,” Dad sternly said.

“What’s that?” I asked in a curious way.

“Moments!” Dad shouted. “Don’t blow big moments. Remember our special moments together?”

“I sure do,” I said as my mind wandered back to the day.

“Wish we could have a few back?” Dad wistfully said.

“Gosh, Dad,” I replied. I’d love that.”

“Greg, this is a very big moment. Your four boys just traveled ‘cross country to be with you on your birthday. Dive in. Don’t waste a second. You’ll look back and be glad.”

Dad was so right. My kids are all here. They came just to see me. Our Savvy Dad readers will understand.

The lesson I learned from Chubby today?

Big moment? Savor the day.

4 wheelin’ behind our Wyoming ranch with Brain, Corey and Casey

4 wheelin’ behind our Wyoming ranch with Brian, Corey and Casey

“We didn’t know we were making memories.
We just thought we were having fun.”