I’ve seen this in person.

It reminds me of the days when I worked in corporate America. As a whole, management were the biggest marks for con artists. I’ve sat in on interviews with people who were clearly unqualified for the jobs they were applying for. The regular employees could spot the con in an instant.

Absolutely true. I was in a meeting with some vendor (essentially, an interview) where we were assessing them on the way to hiring for some major work. This vendor’s reps were appallingly clueless. Just terrible — and rude. My colleague and I were literally laughing in their faces as they were so obnoxiously ridiculous and their claims for what their product could do were simply absurd. I mean that, and am not exaggerating: we were laughing at them openly and making fun of them, and I was two seconds away from asking them to leave and to quit wasting my time.

Then one of the managers waved her hands to quiet me, as I was getting increasingly agitated about it all, and announced how fabulously brilliant she thought it all sounded, and would they be able to start soon?

I was flabbergasted. But these dudes were speaking MBA-ese, and it was incredibly effective. Nothing I said could overrule the MBA vibes permeating the room.

And the project? Oh yeah, it completely failed. Like, tanked so hard not even James Cameron’s submersibles can find it. Not because I sabotaged it — I unsabotaged it. After the first vendor (the MBA-friendly one) was unable to deliver really anything at all, I did half of the project myself, and called in a favor from an old IT contact of mine who finished the rest. There went a few hundred thousand down the drain.

It’s very strange indeed that housing is seen as a “safe” asset class, when nothing could be further from the truth. Housing has high beta, it’s illiquid, it’s beset with all manner of external risk factors, and it doesn’t appreciate much despite all that! It’s like the worst in every way that there is for an asset class.

It’s one and only saving grace is that you can live in it.

However, people treat it like it’s some sort of ultra-safe investment when it truly is nothing close to that. Put $300,000 in a mix of stocks and bonds and $300,000 in a house. At the end of 20 years, including inflation and all the maintenance, taxes, etc., you spent on the house, tell me which one do you think will have greater return at the end?

Unless you got lucky enough to buy during a bust and sell during a boom, it won’t even be close. There’s about a 50% chance you will have lost money overall on the house, while you’ll have about $800,000 in nominal dollars from the stock-bond mix, assuming a historically-conservative pre-inflation 5% return rate. In real dollars indexed to the initial investment year, assuming around a 2.2% rate of inflation, that’s about $500,000.

Very, very little chance a house will come close to that — and as mentioned, it definitely will come with a huge passel of risks and is terribly illiquid to boot, being particularly so when you most need to sell it.

Sounds like a bum deal to me (unless you are buying just to live in, which is perfectly fine).

Why I didn’t go down this path is probably mostly due to my friend Aubrey.

I wouldn’t even describe us as “best friends,” exactly. We were beyond all categories like that. But for many years she was one of the few people at all in my school to be nice to me. Aubrey’s mother died when she was young (five years old) and I think she at first took a liking to me because I was the only one who didn’t treat her like some pariah and wasn’t scared in first grade to ask her about her mother’s death. I wanted to hear her story. I wanted to know her for who she was. She taught me the word “aneurysm” when I was six years old as she haltingly recounted to me exactly how her mother died. I had no doubt at all that girls and women were fully human right from the start because she was the only one to treat me like one.

Lately, I’ve been thinking a lot about Aubrey and realizing how much she truly shaped my life. More than I realized at the time. Another story about her. Years, many years, later we were at an academic team meet and she was in the crowd as the team I was playing for won some big competition. I remember watching her face as I answered the final question that put us over the top just as time ran out. She was gazing at me, hands clenched, with such intense — I don’t even know the right words for it — euphoria and empathy and concentration and was sharing my experience so completely that in the moment when I met her eyes I don’t think I’d ever been that close to someone. And we weren’t even touching. We were a room apart. But it was like we were in the same skull. Truly, I think she was happier with the victory than I was; I was just tired after all those matches. Watching her react, though, made it mean so much more to me. It’s so good to have someone rooting for you, you know? So good.

That’s the kind of person she was. She could just be completely there, unreservedly present. After the match, she came up to hug me, pushing through the throng to get there, and I said “thank you” quietly into her ear. I could tell she knew exactly what I meant even though most people would not have. Like I said, that’s just the kind of person she was. I didn’t know it consciously at the time but she would’ve done anything for me, and I for her.

I don’t even remember what we won anymore. That trophy is long in the garbage. But I do remember her face and her look and how intense that moment was, and I will remember that for the rest of my life.