If I Ruled the World

I don’t want to rule the world. Not remotely. But if I did, some things would be different. I toss this idea out at various points during the semester, usually after I’ve introduced my students to a particularly controversial (or, in my view, stupid) accounting treatment. For example, if I ruled the world, debt issuance costs would be expensed immediately instead of being recorded as assets and amortized over time, large stock dividends and stock splits would be accounted for identically, and convertible debt values would be bifurcated into debt and equity portions at issuance. But I don’t (rule the world). So they aren’t (accounted for like that). And no, there’s nothing I can do to make Accounting any sexier.

Earlier this week, Hadley told me that she and her friends had been talking about Black Friday. Her friends asked her if she was going shopping on The Day. When she laughed, they asked her why. Her response was that her parents don’t like crowds, which her friends found rather amusing. Actually, Hadley is the only person in our family who DOES like crowds. And even at that, she doesn’t really LIKE them. She only likes them in one situation -- when water is involved. She hates going to the country club swimming pool because nobody is ever there. And when I was considering doing a beach vacation (insert sound of gagging) this year because Hollis has never seen the ocean, she said she didn’t think there would be much point. Why? She reasoned (quite correctly), that I would drive 10 miles up the beach so that there wouldn’t be any people around us ... and she would think that was boring. Beach vacation avoided. Win.

If you have followed our travels over the years, you’ll realize that all of our extended family trips tend to be as far away from people as we can reasonably get. We don’t take the kids to Disneyland, Washington D.C., or The Big Apple. We take them to Arizona, Wyoming, Montana, South Dakota, and Canada. Thankfully, the kids -- even Hadley -- are very much like us and eagerly anticipate these vacations. But yes, I am guilty as charged. I’m not particularly fond of people in general and I do hate crowds ... which brings us back to the whole shopping thing.

I truly cannot fathom what would induce someone to choose to go shopping on high-traffic days. Here in Texas, we have a tax-free weekend every August. Stores are absolutely swimming with people who will battle to the death to buy items at 8% off. Me? I go shopping for my kids’ school clothes a couple of days BEFORE tax-free weekend starts. There is inventory out the wazoo in preparation for the soon-to-be insanity and there’s not a shopper in sight. It is glorious. I realize that we are pretty well off and, as such, don’t really need discounts to survive. But come on, even if you drop $1000 on school clothes you’re only “saving” $80 ... and that’s assuming (falsely) that they don’t mark stuff up to compensate for it. And if you’re dropping $1,000 on school clothes then you’re not remotely living close enough to the edge for $80 to make a difference. It’s mental. And it’s doubly (triply?) mental on Black Friday. Like I’m going to get out of bed before daylight so that I can buy a flash drive for $5 instead of $15? Seriously?

So if I ruled the world, here’s how things would go.

Not wanting to stand in the way of commerce, I would permit stores to open as early on Black Friday (or Black Friday Eve) as they wanted. However, as King, I would place a steward at each retailing establishment. The stewards would be charged with maintaining order, passing out Black Friday Numbers (BFNs), and supervising the calculation of Black Friday Ratios (BFRs). What is the BFR? The BFR is calculated as the cube root of the shopper’s place in line (i.e., his or her BFN) multiplied by his or her total percentage discount on purchased items. Specifics? As each shopper enters the establishment, he or she will be given a BFN. The BFNs will be given in ascending order. At checkout, the cashier will scan each shopper’s purchases and his or her BFN. These values will be transmitted automatically to the steward’s handheld device, which will automatically calculate the resulting BFRs. I’ll illustrate with four hypothetical shoppers:

Shopper A -- Total Purchases: $250; Original Price: $500; BFN: 1; BFR = 0.500

Shopper B -- Total Purchases: $250; Original Price: $500; BFN: 499; BFR = 3.966

Shopper C -- Total Purchases: $490; Original Price: $500; BFN: 500; BFR = 0.159

Shopper D -- Total Purchases: $490; Original Price: $500; BFN: 2; BFR = 0.025

The most important thing to remember here is that BFRs are inversely related to native intelligence. In other words, low BFR scores are “bad.” In the limit, a BFR of zero would suggest the lack of any brain function whatsoever, as it would indicate that the person in question stood in line on the most insane shopping day of the year and paid the full price for everything he or she bought. So keep that in mind ... the worst-case-scenario is a BFR of zero. It is also important to note that the cube root prevents the BFN from having too large of a weight in the calculation, thereby allowing for at least SOME premium to exist among early-going shoppers who manage to secure a good deal.

Whatever the case, the above examples show that Shopper A is an idiot because he was first in line at this particular establishment on Black Friday. However, because he received a whopping 50% discount his BFR is 0.500. Contrast that with Shopper D, who was second in line. For her time, trouble, and other non-monetary costs (assuming any such things exist for this person), she received a 2% discount. As a result, her BFR of 0.025 [cube root of 2 x (500-490)/500)] is not significantly different from the no-brain-function level of zero. Meanwhile, Shopper C received the same 2% discount but wasn’t as much of a moron as Shopper D (in that he didn’t waste as much time standing in line). As a result, his BFR is substantially higher, at 0.159 (but lower than Shopper A’s BFR because Shopper C still received basically no price discount). The highest BFR -- 3.966 -- goes to Shopper B, who was #499 in line (right in front of Shopper C) but still managed to get a 50% discount. Clearly we have hierarchical ordering happening here, with Shopper D needing to be subjected to laboratory experiments and Shopper B perhaps deserving partial (but not full) forgiveness for having ventured out on Black Friday instead of staying home and reading a good book.

Moving forward, on Black Friday +1 (do we have a name for Saturday yet?), all BFR scores will be tabulated and directed to Central Processing. Couriers will be dispatched to all households containing residents with BFRs < 1. Individuals with BFRs < 0.10 will be sterilized and will have to pay for it. They’ll be happy about this, though, because the couriers will be instructed to emphasize that they’re getting it for 8% off the regular price. Individuals with BFRs between 0.10 and 0.49 will be offered the option of free sterilization or five years of staying home on Black Friday. Given the trauma associated with option B, it is assumed that most of these people will choose option A. Individuals with BFRs between 0.50 and 1.00 will be sentenced to 500 hours of community service and two years of staying home on Black Friday. Individuals with BFRs above 1 will be sent messages of stern warning and those with no BFRs at all (i.e., those who Did the Right Thing and stayed home) will be sent holiday gift baskets and many words of good cheer. The hope, of course, is that within a generation or two, much of the rabble in my kingdom will be no more. And with Prince Reagan (aka The Hermit) ready to assume the throne after my demise, I have every confidence that the future of WilkinsLand is very bright indeed.

That’s all I have for today. I hope you have the Happiest of All Possible Thanksgivings. And if you do venture out on Friday, watch your BFRs.

Peace

Mike

Favorite Day of the Year

Most of my chats with Chelsea (my TA) either begin with family business or somehow end up there. This week was no exception. I have no idea where this particular conversation started but ultimately it worked its way back to talking about what kid stuff was going on that afternoon and evening, who was going to have to go pick up which kid and take them where, what random food (aka fried salt) events were likely to ensue, what the various lobbying positions for all of these activities might involve ... y’know, the usual daily parenting stuff that successful, thoughtful, motivated, extremely mature, world-beating college students can’t imagine in their wildest dreams.

After highlighting in technicolor what a pain in the butt the rest of the day was going to be, I leaned back in my chair, assumed my best pontificating pose, and said “So ... you know what my favorite day of the year is?” Chelsea sat there for a minute, gave the matter careful consideration, and said “the last day of school?” Although that was a very good guess (and she did at least get partial credit for taking the bait), I informed her that the last day of school -- while extremely good in certain respects -- also has at least one big downside. Not having to deal with homework and school activities most definitely is fabulous, but there’s also the bit about all four kids being at the house and around each other 24/7 for 12 weeks. As a result, while the last day of school is terrific, the baggage (however slight) that is associated with it renders it imperfect. And for a day to be classified as “favorite day of the year”, it has to be perfect. 

At this point, Chelsea sighed, leaned over to throw away her third (or maybe twelfth, I don’t remember) Almond Joy wrapper, and we resumed the conversation:

Chelsea -- Fine ... What IS your favorite day, then?

Me -- (pausing for effect) November 5

Chelsea -- (pausing because she thinks I’m mental) November 5??

Me -- Yep

Chelsea -- Why??

Me -- Because this year, it’s the first Saturday in November.

Chelsea -- And??

Me -- That’s the day when we get to set the clocks back an hour.

Chelsea -- That seriously is the most anti-climactic thing I have ever heard.

So ... WHY is the First Saturday in November (FSN) my favorite day of the year? Here’s why:

1. Signaling -- FSN is the very first CONSISTENT indicator that Autumn might, in fact, finally have arrived. When you love Autumn as much as I do and when you live in a place that is as thoroughly awful (not to mention devoid of Autumn) as Texas is, you need reliable signals. An occasional morning temperature of 50 in mid-October most emphatically is NOT a reliable signal of Autumn, because in two days you know the high is going to be 90 again. So ... I view FSN as the first consistent, unwavering, year-in-and-year-out signal that a reprieve (however brief) from the sheer misery that is Texas weather is, in fact, forthcoming.
   
   
2. Accounting -- No, I don’t really view it this way but I thought it was sort of clever and the logic does work reasonably well. In accounting, you basically record stuff once you’re sure it’s going to happen. For example, if you have a contract to deliver something to somebody and all of the i’s are dotted and t’s are crossed and you’ve handled your part and you ship it to the customer and they are going to pay you within 30 days or whatever, you don’t wait until you actually get the money to book the sale. You book the sale now. That is what accrual basis accounting is all about. And FSN works the same way. Once FSN arrives, I know that in addition to the weather-related goodness from point #1, a lot of other fun stuff will be going down in the very near future as well ... so my mood picks up. What fun stuff? Exhibits A, B, C, and D would be Thanksgiving, my wedding anniversary, Christmas, and Christmas vacation. Christmas vacation is particularly good because it does NOT have the afore-mentioned baggage that goes along with summer vacation. Yes, the kids are still around each other all the time but it’s only for a couple of weeks and Christmas is their favorite time of year ... so that mini-vacation typically is relatively conflict-free. My wedding anniversary is a 10-day party (deserving of its own blog entry) so that is another huge upside, and obviously Thanksgiving and Christmas are fantastic. Bottom line -- FSN is a harbinger of lots of Very Fun Stuff, which my accrual-basis training permits me to book up front. (Note: That probably is the first accounting-as-real-life reference that I have ever made, and it probably will be the last as well.)
   
   
3. Sleep -- I hate waking up. My response to hearing the alarm go off every single day is “You have GOT to be kidding me.” I am 44 years old and our oldest kid is 18. Therefore, I have been waking up at an ungodly hour (that is, before 10) for 9 months out of the year for the past 13 years. Yet despite the conditioning that one would THINK should result from all of those years of misery, every morning is still an absolute battle. Every single morning (without fail) I wake up with poison running through my veins AND we have to get kids up and fed and ready and all that as well. It is not a good time in general, and it’s even worse when I’m having to get up 90 minutes before sunrise. Plus, Paige isn’t exactly an eager early riser either. Who are these people who invented the “work day” anyway? I mean, really ... who was the first person who thought that it would be a good idea to start waking up an hour to an hour-and-a-half before there is ANY INDICATION WHATSOEVER that it’s not the middle of the night? This person probably was the ancestor of today’s oh-so-superior man/woman who starts the day with a little wheat germ, sheep’s milk yogurt and five kinds of fruit juice (none of them orange, of course) and then gets in a quick, invigorating 10-mile run (without sweating) before coming back to gently wake the perfect children who calmly file downstairs and quietly eat their freshly prepared breakfast of  home-made granola, passionfruit, and stone-ground whole wheat pancakes. At Casa Wilkins, meanwhile, it’s a comatose middle-aged wonder growling “one Pop-Tart or two?” at similarly comatose kids. So I will take that extra hour of sleep on Saturday night, thank you very much. But more importantly, I will also revel in the fact that come Monday, I won’t have to turn on a light when I drag my sorry carcass out of bed.
   
   
4. Dark -- Those who know me well might find at least part of my tirade in point #3 to be strange. Why? Because those who know me well know that I absolutely love the dark. In fact, I’ve told many people over the years that “early dark” is my favorite time of the year. And “early dark” begins with FSN. The key, of course, is that I like the dark on my own terms. Clearly, I don’t want it to be dark when I wake up. Ever. But once that hurdle is out of the way, I’m good with it being dark anytime ... the earlier the better, and the longer the better. Don’t believe me? Take a look at the picture at the top of the page. That’s the most well-lit (only lit) corner of my study slash cave. This room is painted an extremely heavy brownish maroon color. I repainted it last week and made it even heavier. My color choice was not driven by any particular fondness for Texas A&M University nor its colors. Rather, the room is a complete pain in the butt to paint and it was already that color ... and making it darker is both (a) easier and (b) darker (i.e., better). Furthermore, my study is lit by a single 20-watt fluorescent bulb ... shaded ... on the interior corner of my desk ... partially hidden underneath a shelf. So I am more than a little bit vampiric. And FSN is a friend to vampires.

For all of these reasons (and probably others that escape me at the moment), FSN is my favorite day of the year. And to finish the previous story, upon hearing my “anti-climactic” FSN revelation, Chelsea immediately asked me if the “spring forward” date (the second Sunday in March, for those who are curious) is my least favorite day of the year. At the time, I told her “yes,” because it’s logically consistent and because I hadn’t really thought about it. Upon further reflection, however, I realize that is NOT the correct answer. Details next year ...

Peace,

Mike