Father's Day always causes me to muse about the ways in which growing up in a business-oriented family, surrounded by business (mostly) men, has shaped my world view. This is going to be more a collection of fond personal recollections than anything that might interest general readers. I'm writing for me and my favorite businessman on this one.
Some of you may recall my father's summary statement on risk and returns:
“Maxine, the higher the returns, the higher the risk, and if the returns are high and sustained, you’re in a Ponzi scheme or a bubble. Never forget that.”
He laughed out loud when I told him I had quoted him in my blog. "You remembered that?" he said, obviously delighted.
Yes, indeed, I remembered it. How can anyone forget the things our parents tell us that ultimately shape our lives?
I still remember when I turned 16. Dad sat me down on the sofa and told me it was time for us to have a serious talk. Internally cringing, wondering if I should tip him off that mom and I had had "the talk" when I was 12, somewhat flustered at the prospect of discussing sex with my dad, I just sat, mind racing, hands clasped, praying the talk would be short.
Imagine my surprise (and relief), when he handed me a credit card. He then proceeded to tell me that he had counter signed for it, but it was in my name so that I could begin to build that most important facilitator of commercial exchange, a good, solid credit rating. Dad didn't bring up sex that day at all, but he pretty much implied that he regarded a good credit rating as at least as important as, oh say, his oldest's virginity. Maybe he sensed his oldest wasn't a wanton. Or maybe he was just a very pragmatic and prudent guy. Either way, he set me on the road away from credit serfdom that day. When my husband and I canceled our (large investment bank bailed out by TARP) credit card over a year ago (for raising interest rates when we always without fail paid our entire outstanding (sometimes large) balance each month) and applied for a lower interest card from a reputable smaller bank, our personal banker told us that we had the highest credit rating she had ever seen. Thank you, dad.
When I was growing up, we lived very comfortably, but were never rich by any measures other than good health, good brains, and on most days a good work ethic. I think one reason we weren't rich is that dad would allow people to purchase expensive items and pay them off over 12 months with no interest. I asked him about this one time recently. He said it just seemed like the right thing to do. I would guess it was also a consequence of a small, competitive local market, where norms, institutions, reputation, and other cultural and market forces served to promote timely repayment of loans and time-purchases, i.e., to reduce the transaction costs of exchange and payment.
However, one time, a representative of a famous movie actor from our town approached him about giving a special discount to the movie actor's father on a sizable purchase. Dad declined. When I asked him why, he said that the movie actor could afford the full price (as could the movie actor's father, a fellow businessman in our town). Dad said that if he was going to start discounting merchandise, he was going to discount for someone who actually needed a discount. So the movie actor's father made his purchase elsewhere. My dad, the man of principle.
In honor of father's day, this has been about dad. I'll just close by saying that it takes an unusual woman to hold her own against the businessmen in my family. My own mother could easily have run any large corporation. Dad used to say he never could figure out why someone as smart and beautiful as she would marry him. Instead, she kept the company books, raised their kids while he promoted the business and our community, encouraged her daughters to stretch intellectually and occupationally, and, with my father, helped to perpetuate the family tradition of business-like prudence tempered by a strong commitment to fairness.
I'm not sure from whence comes the willingness to blog when anyone anywhere is not adhering to one or both of the family virtues.
Happy Father's Day, dad!