Saving a lot of money and almost getting killed

tim108

(Originally written Aug. 30, 2014. This is an edited version of that)

Dear Ezra and Lian (when you’re a little older),

A couple weeks ago, my co-worker and I helped save the people of Ontario a lot of money. It’s not a big deal. The people I work with do this sort of thing all the time. Nobody congratulated us or gave us a gift. It was just another day at work. Within a couple hours, I had made a few paper work mistakes. My intelligence and work ethic were being questioned. It was all in good fun. It’s what people, especially guys in an industrial environment do. They laugh at one another when they make mistakes. Then we fix the mistakes. It’s a little bit mean, but my little buddies, you need to learn to let things like this go. You will get yourselves needlessly upset if you don’t. You will waste too much energy on it. Take satisfaction from doing a job well. Smile at the jokes, keep your head down and keep on working.

My co-worker asked a good question. I went and argued his case. Due to a miscommunication and misunderstanding, one of our generators was going to be shut down for 40 hours longer than it needed to be. “Equipment breaks and people make mistakes.” It’s one of the first things I learned when I started working full time when I was 19. Same job as I have now. Even highly trained and paid professionals make big mistakes. There was going to be a lot of chances to correct this mistake and I’m fairly certain someone else would have found it. “Never attribute to malice that which is adequately explained by stupidity.” It was just a stupid mistake. No one was trying to rip anybody off. Maybe I’m more forgiving than I should be, but you both need to learn to forgive people their stupid mistakes. It is not just good for them. It’s good for you. You can’t spend your whole life hoping people get what they deserve. You will be miserable. Let it go.

Here’s a story from 20 years ago when I was 21 that will tell you what I mean. I had a little job to do at work; close 2 little valves and open another. Hang yellow tags on all 3. I found the right valves. Just then, two other operators walked up and took off a yellow tag off the bottom of a tank near me. They walked away and I started my job. I closed 1 valve and put on the tag. Then I noticed the floor drain 1 foot away from me started to have some steam come out of it. Hmmm. I opened up the second little valve and put a tag on it. Now there is water and steam bubbling out of the drain. I go to close the last valve, but I hesitated. I looked at the drain again. I stopped what I was doing. I walked behind the elevator, picked up the phone and called my supervisor. “Hey, buddy, I’m here on the Turbine Hall doing this job. Two guys were doing a different job and now there’s some water bubbling out of the floor drain. Do you know what’s going on? Is that normal?” (Remember I’m young and inexperienced.) My supervisor said, “How much water and steam is coming out of the drain?” So I put my head around the corner to see about a 50 foot column of boiling hot steam and water shooting out of the floor drain right where I was standing. 1000s of litres of hot water was shooting in the air and spilling all over the floor. If I had stayed there 2 minutes longer to finish my job, I would have been cooked alive. It would have been very painful way to die.

I was in such a state of shock, I don’t remember anything from there until I got to my big boss’s office hours later. We went over what happened. The drain pipe on the tank had 2 drain valves which is not normal. The guys taking off the yellow tag thought the 2nd valve with the white tag was already closed, so they left the yellow tagged valve open. The guys who wrote the procedure thought the white tagged valve would get closed. We used to write all these procedures by hand. Recently we had started using computers. It saved a lot of time and stopped a lot of spelling mistakes. However, when it created a “de-isolating” procedure, it just did the reverse of the “isolating” procedure. The writers didn’t check close enough and make changes. They should have written to have both valves closed and assumed nothing. As hot water came into the tank, it went through the open valves and down the drain pipe to a “sump”. When the sump and the pipe filled up, the pressure pushed all the boiling hot water up through the open floor drain and all over the spot I was standing moments before. Assuming too much and putting too much faith in new technology caused this accident.

The station manager convinced me that nobody had really made a serious error. It was the fault of bad information and a bad computer program. He asked me not to write a Significant Event Report. (The big ones, get read all around the world-wide industry.) At the time, it made perfect sense. I was eager to forgive everyone and move on. So I did. Unwittingly though, I was covering up a serious mistake. All the procedure writers, computer programmers and workers needed to hear this story. Things needed to change so that it never happened again. Instead, I walked around work for over 17 years never telling anybody. I didn’t want anyone’s reputation to get hurt. That was dumb, dumb, dumb.

Paying attention and thinking that maybe something is wrong saved my life. Assuming everything was safe and not paying attention for just a minute meant these guys almost killed me. This is why I get more upset with you than I should when you don’t pay attention. Bad things happen when people lose focus on safety. I’m trying to protect you from a dangerous bad habit.

If I had died, I would have been the 7th nuclear power worker to die in North America and 1st in Canada. My accident would have been front page news and studied for years by those in my industry. Grandpa and Grandma would have been offered a lot of money not to sue the company. If it went to court, it would have received a lot of attention. Given the circumstances, there was probably criminal negligence causing my almost-death. Anti-nuclear activists would have used this accident as “proof” of an unsafe industry needing to be shut down. It would have been a political and legal storm swirling over my dead body. I’m glad I listened to that overwhelming sense that something wasn’t right and moved. It would have been terrible to put my family, friends and co-workers through all that.

Keeping secrets is silly. Usually the bad stuff we worry about doesn’t happen. You will carry an unnecessary burden trying to protect yourself and others. Just tell the truth and free yourself. Keeping secrets is stupid. Others miss out on a chance to learn from our mistakes. Kids, please learn from all of mine.

Love,

Dad

 

P.S. Next time I tell you about one of my secrets or mistakes, I will make it a lot shorter.

I was 45 minutes away from being a millionaire

tim89

Dear Ezra and Lian,

This is such a part of my life, I forget sometimes how much it freaks people out when they hear about it for the first time. I mean, the people who think they know me well. They never see it coming. It will shake my friends much more than you or I. Money often does.

Today (Aug. 25, 2015) and the last few days are like a replay of the autumn of 1997. Currency trouble in Asia has led to large stock market declines. The swiftness with which this has unfolded is breath-taking. In 1997, similar events took months to roll out. I felt the US stock market was grotesquely over-valued and fuelled by speculative loans. The stock markets doubled in value in 30 months. Billions of dollars had been wiped out in Asian bond and stock markets, yet nothing happened here in North America.

On Oct. 21, I turned 25. The next day, for the first time in my life, I bought about $35,000 in “uncovered put options” on the S&P500. All of my options were well “out of the money.” I could only make money with a big crash. If the prices on the stock go down, my investment goes up. The further down it goes, my investment would rise exponentially. The very next day, the Dow Jones Industrial Average (DJIA) went down a lot (187 points). My “investment” went from $35,000 to $55,000. The next day, the DJIA went down another 128 points. My investment was now worth about $80,000. By the end of Friday, I couldn’t wait for Monday.

Monday came and it was historic. From Wikipedia, “By the end of the day, the Dow Jones Industrial Average fell 554.26 points, or 7.18%, to 7,161.15. Back then, this was the 12th biggest percentage loss and 3rd biggest point loss on record… The S&P 500 fell 64.63, or 6.86%, to 877.01…This crash put the Dow down 12% from its then-record high of 8,259 on August 6… Volume also hit a record high. New York Stock Exchange volume topped 695 million shares, breaking the previous record of 684 million shares traded on January 23, 1997. $663 billion in market capitalization was wiped out.” For me however, I was now worth about $280,000. I picked up the phone to call my supervisor. I was going to tell him that he would never see me again at work. For me at 25, I was young enough and with no responsibilities. That was plenty for me to retire. However, I hesitated and decided to wait for late Tuesday afternoon to make the call.

I took the day off on Tuesday. I got ready for the day that I knew would change my life. I was confident by the end of it, I would have quit my job and begin a new life’s journey. I had my plan, when my investment got to $1 million I would start selling my options. Before the market opened at 9:30 am, stock futures were showing that there would be another day of losses on the stock market. Hong Kong’s Hang Seng had fallen 14% overnight. All good news for me.

From 9:30 to 10:06 am, the DJIA lost 186 points. In those 36 minutes, I “made” about $270,000. My total was at $550,000. After 10:00 a.m., I was making over $10,000 a minute. The rate was actually rising exponentially because of the nature of my investment. At this rate, in another 45 minutes I would be worth more than a million dollars. By the end of the day, I was on track to have over $4 million.

Then a funny thing happened on my way to this new life. Alan Greenspan, the Chairman of US Federal Reserve decided to intervene in the markets. In a coordinated effort with some of the world’s biggest banks and brokerages, they began buying to prop up the market. The stock market turned around. It began to rise.

I will cut out all the details. Let me just say a few things. I sat stunned. I couldn’t sell. I kept waiting for the stock market crash to overwhelm the Fed’s actions. One day moved into the next. Options have expiry dates. I literally held onto them until they were worth nothing. I had made and lost over half a million dollars in a few weeks.

In my personal aftermath, I felt like “Hmmm, I should want to kill myself for losing all this money, but strangely I don’t feel that way at all.” My parents could have really used some financial help at that time, but I made a big mistake. I really regretted not being able to help them. It was easy come, easy go. I kind of felt nothing. As the years have rolled by, I do regret my missed opportunity. It’s been really hard the last few months watching the Shanghai Stock Index fall, but not making these same bets again. Your well-being has kept me making safe financial choices.

Here are a few things you can learn from your dear-old-Dad;

  1. Greed can kill you. The last few days have probably created losses over $1 trillion worldwide (my guess). There are going to be a lot of people who kill themselves because of that. If they had been satisfied with a small return, they would have their money somewhere safe now. Instead, some like me, will have lost everything. They won’t be able to deal with the consequences.
  2. Greed can sneak up on you. Ezra, you and I are pretty non-materialistic. Don’t let that fool you into making foolish choices based on greed. Until October 1997, I had no idea I could be that greedy. I mean I wasn’t satisfied with $550,000. I wanted a million dollars. How crazy is that?
  3. Have an exit plan. How are you going to get out of an investment, decision or situation? If you let your emotions guide your decisions, you will make bad decision after bad decision. Make a plan when you are calm and have no stress. In the heat of the moment, if you stick to the plan, it can get you out of trouble.
  4. Be accountable to somebody else. All of us need somebody to hold onto us and pull on our chain when we can’t move or we are doing something stupid. Making decisions while sitting alone in front of the TV or the computer is a recipe for disaster.
  5. The single best way to get addicted to gambling or anything for that matter, is to win the first time. If your first experience is great, you will come back for more. Lots of drug dealers/”friends” will give potential clients/”friend” a free first sample. The addicted will come back for more because they keep trying to experience that first time again. I didn’t make a really good investment decision, I got extremely lucky on my first buy. That was dangerous. It could have ruined me.
  6. Practice letting go. When we fall in love with our decisions and our stuff, we can’t let go. It is a constant struggle with me, but I daily have to let go of things. This is one reason why we constantly have to save money, give money to charity, take our old stuff to the second hand store, and throw out garbage and papers. We have to let go constantly. If we don’t, our possessions will possess us. Hold everything lightly in your hands. When it grows wings, let it fly away.

This will mean a lot more to you when you are older and you find out how difficult it is to earn money through honest, hard work. I hope my bad experience helps you in some way.

Love,

Dad