Monday, March 22, 2010


We are getting lots of emails asking us what our reasons were for moving from Hilo to Kona. Our immediate motivation to move was to get away from the increasingly boisterous students from the UHH campus near our rental house in Hilo. Once we started looking, we discovered that Kona rental prices had dropped since we looked two years ago. This meant that it was affordable for us to rent in a new condo complex across from a beach and walking distance to Kailua Pier. We assumed living in Kona would be much like Hilo with more sunlight and more places to swim. We are surprised at how different living in Kona is from Hilo.

In our Hilo neighborhood most of our neighbors were elderly, retired, and lived life at a slow pace. In Kona everyone in our neighborhood is on the move, jogging, walking, swimming, bicycling, and cheerfully greeting each other; it is a constant blur of activity. In Hilo folks take time to talk story and enjoy lots of celebrations and pot lucks. In Kona people advise us on where to go for daily walks, the best routes to swim, and share their favorite workout schedules. Folks in Hilo are pretty laid back with a high tolerance for clamorous college students and aggressive pan handlers downtown. In Kona there is little tolerance for loud parties, aggressive pan handlers, and Kona has numerous organizations working to make it a less rowdy place.

We moved to Hilo to recover from 10 years in Silicon Valley and restore ourselves physically and emotionally. We loved the laid back Hilo lifestyle and we doubt if we could have relaxed and recovered as much if we had moved to Kona two years ago.

Now, we are rejuvenated, ready for a new challenge, and want to make progress on our physical fitness. Our Kona neighbors are professional athletes, fishing charter owners, and work in the tourist trade. We hear them rise at 5:30 AM and head out to their boats, jobs and workouts. We watch athletes push themselves physcially and fight their fatigue. At a recent KVBID meeting, Kailua-Kona business owners presented their progress on beautifying Ali’i Drive, improving security, and increasing the local businesses' revenue. We find the vibrancy and energy of Kona to be invigorating and inspiring.

We have met many people in Kona that spent two or more years in Hilo before making Kona their home. We share our rich experiences of living in Hilo and count the benefits and blessings of the time we had there to better understand and appreciate the island of Hawaii.

Thursday, March 11, 2010


As our Boomer generation approaches the magic retirement age of 65 years, there is increased news coverage about whether we all are going to get our due retirement payouts like our parents’ did. The relevance of the subject to us motivated us to track down where the modern concept of retirement originated.

During the late 1880’s in the United States, 78% of workers over the age of 65 still worked full time. The concept of retirement was introduced in Europe in the 1880s by European leaders who sought to quell the rising popularity of communism by proposing full pay for workers that left the work force after their 65th birthday. This was an easy promise in the 1880s when the average life expectancy of a worker was 45 years of age.

Somehow the age of 65 stuck and the fantasy of living a life of leisure after “retiring” from the workforce at 65 became the pervasive industrial age dream though few lived long enough to have it until the Boomers parents’ generation. By the early 1960s over 30% of large US corporations had some form of retirement plan for their workers along with the US government, state governments and military. Meanwhile, longevity increased from 45 years of age in 1880 to over 78 years of age today.

The original “promise” of retirement 130 years ago was only to the few who managed to survive 20 years past the average life expectancy of their generation. Our society has never adjusted the age of retirement to account for the increase in longevity. The average life expectancy is now 78, so using 65 as the retirement age has now become a promise of retirement 13 years before the average person in our generation dies. If we adjust the retirement age in 2010 based on current longevity as compared to the original retirement age suggested when the concept was introduced in the 1880’s, our “longevity adjusted retirement age” would be 98 years old.

Resetting the retirement age expectation to age 98 would make it pretty easy for governments and companies to fund those few who live that long. It would make saving for the remainder of one’s life after leaving the work force at 98 years of age feasible for most.

Since the modern world has conferred such great longevity upon our generation, it is unfeasible for most people to save enough money to support themselves without income for 20 to 30 years of life after age 65. Even those with million dollar windfalls during their career will be challenged to navigate through 30 years of global economic and political change to preserve their retirement savings.

Thinking about this has freed us from the stress and worry of saving enough money to support ourselves for 35 years of retirement. Like many boomers, we have small IRAs and doubts about ever receiving our social security payments in a decade and a half from now. We are starting to realize that the key to growing old with a great standard of living is to have excellent health, sharp minds, and income producing work that we enjoy and can continue to do well until we are 98 years old.

Sunday, March 7, 2010


The extreme deficit spending by Portugal, Ireland, Greece, and Spain (PIGS) may be the end of the Euro, the currency in Europe. For much of the past decade the European Union (EU) was strengthening their federation and the Euro was poised to overtake the US dollar as the world’s new global currency. The Euro, like the US dollar, is one of the few market-driven, massive-value, currencies in the world (many of the world’s currencies are pegged to the value of US dollar or Euro). Now economically stable countries in the EU, like Germany, may not be willing or able to stabilize the Euro’s sinking value resulting in a massive selloff of Euros and a crash in its foriegn exchange value.

Though the crisis seems to be caused by Greece’s deficit spending and accumulated debts, it is far worse. The real crisis is one of the credibility of the EU’s financial system. It turns out that Greece has been fudging its budget numbers for years and now with a new Administration in power, the extent of their past deceptions are being revealed. This deception creates a trust issue that goes far beyond a deficit problem. California has a huge deficit and massive debt, but it is known and exposed for all to see. How did the EU miss Greece’s fudged accounting and how many other countries in the EU are using the same accounting practices? As French President Nicolas Sarkozy promises solidarity with Greece and threatens to fight speculators daring to bet on the Euro’s demise, global Euro holders must ask themselves what is the true value and future viability of this currency?

Greek leaders are out campaigning for low interest loans in Europe and on Tuesday will ask President Obama for help from the US to scrape together enough money to pay off their growing debts. Spain and Portugal are rumored to have even larger debt problems than Greece, but like Greece, the true picture is really unknown. Germany, the fourth largest economy in the world may be motivated to return to their own currency to isolate their economy from the demise of the other countries and collapse of the European Central Bank.

A surge in the value of the dollar means US products will be more expensive in Europe. European tourists will find it harder to pay for vacations to the US and Hawaii. The upside for Americans is that Europe may once again be affordable.