Personal Finance - the salary question

My parents came and visited Minnesota over Labor Day weekend. The trip included Prairie Home Companion at the Fair, a roadtrip to Red Wing and a Twins-Royals game at Target Field. Also, we all went out to eat a few times. During our last meal (our grand finale as my Mom would call it) at Salut on 50th and France we had an interesting conversation about personal finance. Specifically the topic of salary came up.

I would describe our family as having good communication on finances. Not great, but good. My Dad and I talk pretty regularly on stocks and certain strategies. He has provided not only an excellent financial example, but also has provided sound advice. Also, he got me hooked on Money magazine, which is now one of those things I look forward to every month. Let's just say that I am happy to have been brought up in my family.

There is one thing that hasn't been discussed often in my family and that is the salary question. I think I might have told my parents my starting salary at Target and maybe let my salary at Honeywell slip at one time. However, I have never once known what my parents made, which never concerned me as a kid, but now I find slightly surprising. It is one of those things that is not talked about and is a topic that makes my parents uncomfortable.

Why is that? Why is the topic of salary such a tough subject? The only reason I think it is such an important question is that people place so much importance on it. In some ways people can define themselves by their salary. They literally place their worth on what they are worth to a company. This shouldn't be the case for a number of reasons, but from a strictly financial perspective salary is only part of the total equation. Knowing someone's salary doesn't mean you know how much they spend, how much they save or what their parents have or have not provided for them. There are plenty of people that immediately come to mind who either don't have a salary or have a very small salary who live in expensive houses and go on wonderful trips.

One advantage to people sharing salary information is that it empowers you in salary negotiations with your current or future employer. If you know the going rate for someone of similiar background then you might be pleansantly surpised (your salary > friend) or might realize that you should ask for more money.

Of course the reason people don't do that is because of social norms. There aren't many people out there who want to make others uncomfortable. This is a real concern if the salary question might lead to answers of amounts that are very different. However, I think most of those amounts should be anticipated. A cashier at Taco Bell obviously makes less than than a dentist. If the difference is that large then it probably doesn't matter one bit if either knows each other's salary. Where it does make a difference is when people are in the same or similar fields. And for that I propose something unique: I will tell anyone who asks my salary as long as you also tell me your salary. I don't take great joy or discomfort in my salary and don't think I will have any problem disclosing that information to a trusted friend. Maybe I will? If I do have reservations then I will admit that I am wrong and as M would probably tell you that doesn't happen too often.

New job

I realize it has been awhile since I posted and an even longer time since I posted something non-sports related. No excuses on the front. Anyway, I would like to update everyone on something (work) I don't normally write about. You see after 37 months as a Demand Manager of Combustion it is time for me to take my talents to the new SAP team at Honeywell.

For those of you who are confused let me break it down for you. I am part of the SAP rollout for the ECC team with a primary focus on APO. The ECC team of course is part of ACS, which is one of the main businesses of Honeywell Corporation (ticker symbol HON). I hope this is clear for everyone since people at work use these acronyms without ever defining them. You either have to get a chip implanted into your head (very painful) or pick up what the acronyms mean through context, which is kind of like trying to learn the Egyptian language without the Rosetta Stone.

Anyway, in all *honesty I am excited to be joining a new team. This project should be a learning experience for me and worst case scenario is that I figure out I really hate working on projects. It comes with it a 13 month commitment, which means M and are staying in Minneapolis through at least October 2011. My joke is that will be enough time to see the Twins win back to back World Series.

*Does anyone else hate it when people use that phrase? Taken literally that phrase could imply that everything the person said before that moment was one big lie. The only phrase worse than that is of course when someone says "Can I ask you a question?"

I hope all is well. I have future posts coming up that I am tossing around. The topics include but aren't limited to; personal finance and the salary question, John Stockton vs. Steve Nash, the Twins 2010 review, fantasy football (I'm a genius - I took Arian Foster in the 4th round. I'm an idiot - I took him a round after I took Jonathan Stewart) and a few commercials that have been good (Ore-Ida) and bad (Michelle Bachmann). If you have a preference on what I write about it next just let me know.

Utah Jazz 2010-2011 Season Forecast: Steady with Sloan

My unsolicited advice for those readers with a large ego is to become a forecaster. I am confident that the size of your ego will dramatically decrease when you see just how difficult it is to forecast. The reason I can write this so confidently is that for the last three years I have been a professional forecaster for a Fortune 500 company. In addition to forecasting over 2,000 items I have participated in plenty of training sessions aimed at improving forecast performance. One might think that with this experience that I might be an expert forecaster. I am not. I try my best to increase the probability that my forecast will be accurate, but a good portion of the times the actual demand doesn't cooperate with the forecast.

Now that I have gone over my credentials (or lack of if you prefer) I am going to try my best to go over certain ways you can forecast the Jazz win total for next year. First I look over a few statistical tools for a top down forecast. For this I used total wins over the years where Coach Sloan was the head coach of the Jazz. After looking at those I looked at a bottoms up forecast by looking at the individual players on the roster for next year. For this analysis I used the Win Score per 48 minutes, which is just an estimate of the number of wins each player contributes to the team divided by the amount of time in a game. For more information on this stat please read the following from basketballreference.com.

Anyway, below are the forecasting techniques (in various levels of complexity) I used with the overall wins since the 1989-1990 season.

• Mean - A simple average of the 21 seasons is 51 wins per season.
• Median - The middle number of wins was 53 wins in a season.
• 3 year moving average - The average number of wins over the past three years has been 52 wins per season.
• Regression Analysis - 47 wins (This type of data looks at past data points and tries to create a "line of best fit"that reduces the amount of error between the model and the data. )
• Simple Exponential Smoothing - 52 wins (This type of forecasting places greater emphasis on more recent data points. If you care I used an optimal alpha of 0.79)
• Linear Trend Analysis - 45 wins (This type of forecasting technique tries place the best straight line through the data.)

There are other models I could use, but in the interest of time I stopped at those six. Overall the models predicted a pretty small range between 45 and 53 wins. This speaks to the consistency of Jerry Sloan has had in producing winning teams. Now let's see if the bottom's up approach to the forecast matches what we got above.

Using the stat Win Score and more specifically WS/48 I looked at each player and tried to predict their WS/48 and the amount of minutes they will play. For some players like Deron Williams it was easy because I used the same minute (2802) and same WS/48 (0.177) to calculate the same Win Score of 10.3 as he had last year. That means that according to this statistic Deron Williams directly accounted for 10.3 wins for the Jazz last year.

There was no reason to mess with those numbers, but with other players I made assumptions detailed below.

• Paul Millsap will have the same WS/48 (0.151) but will play more (projected 2673) because of Boozer leaving.
• Al Jefferson will have the same career WS/48 (0.119) and will play about the same minutes (2900) that he did in the 2007-2008 season.
• Andrei Kirilenko will have the same WS/48 (0.171) as last year, but will play more minutes (1802).
• Gordon Hayward was probably the most difficult player to forecast. I looked at the rookie year WS/48 for the past ten 9th picks in the draft. The average WS/48 was 0.0768, which included really good players like Andre Iguodala, Amare Stoudemire and Joakim Noah as well as busts like Patrick O'Bryant and Rodney White. The 9th pick of the draft seems to be very hit or miss with he lone exception being last year's 9th pick Demar Derozan, whad a WS/48 of 0.066 over 1664 minutes. For Hayward I used the average WS/48 of the past ten 9th picks (0.0768) and then estimated he would play 1700 minutes.
• Raja Bell - I estimated 1500 minutes and then used his career WP/48 of 0.085.
• CJ Miles - I increased his minutes to what Wes Matthews played last year (2025) and kept his below average WS/48 of 0.061 the same. The Jazz could really exceed expectations if Miles improves his game since there will definitely be minutes available for him.
• For the other players (Price, Fesenko, Gaines, Evans and Jeffers) I made a few minor adjustments, but nothing that would affect that Jazz win total by more than maybe a game or two.

I then made sure the minutes played for the team equaled 82 games X 5 players X 48 minutes per game or 19,680 total minutes. After all of those calculations and assumptions the total win score totaled up to 50.1 wins. The 50.1 is in almost exactly between the 45 and 53 wins that we got above so that makes me think that it at least feels correct. Also, as a general rule I tend to agree with a bottoms up forecast approach since it takes more time and analysis to do. With all of that that being written my official prediction for next year's Jazz team is 50 wins. Now I can just sit back, enjoy the season and see how wrong my prediction is since that is the life of a forecaster.

Big news for the blog

I have been waiting for the right moment, but I would like to announce a big development in my blogging life. As my loyal readers know I enjoy spending a decent amount of time writing about my favorite NBA team the Utah Jazz. In addition to writing about them I like to follow them regardless of it is during the NBA season or not. One of the ways I have followed them is by checking out local blogs like Salt City Hoops. Recently they had an "open tryouts" to try and get new blog writers. I sent out an email asking to be a part of the team. The organizer sent me back a response saying that he would love for me to join. Therefore I would like to officially announce that I am taking my talents to the Salt City Hoops as a contributor to their blog.

One great thing about Salt City Hoops is that is affiliated with ESPN. If you go to espn.com, then click on the NBA, then on TrueHoop (the great blog run by Henry Abbott) then you will see Salt City Hoops as ESPN's Jazz blog. This is a great partnership because it will increase readership and get our opinion out through such a large sports media outlet. For example my post on Malone vs. Duncan has received 6 comments. As you probably know from following this blog that is a lot for me.

Anyway, my first post (which you can see unedited on this blog) is featured on ESPN's Monday Bullets and on Salt City Hoops. I am excited to be joining this team and hope to produce a few more pieces a year about the Jazz.

Is Karl Malone the greatest power forward of all time?

I was watching the Twins game the other day and they were honoring Dan “The Dazzle Man” Gladden as one of their 50 greatest players. This seemed about right in my mind. I mean I remember him as someone on both championship teams and the image of him running in for the winning run in the 1991 World Series is a classic baseball image. However, I checked his stats and they were absolutely dreadful. From 1987 to 1991 he played for the Twins his OPS+ (a great stat partly because 100 = the average baseball player) in his 5 years in Minneapolis was 90 making him a below average player. On the 1991 World Series winning team he was ranked the following out of the 9 starters; 9th in OBP%, 8th in Slg%, 9th in OPS+ and 7th in hits.

Statistics are funny like that sometimes. Sometimes like in the above example they completely contradict what you had always thought. Dan Gladden had always been in my mind one of the Twins best players. He was a gritty, gutsy player who helped will the Twins to two World Series titles. In reality the Twins won those titles not because of Dan Gladden, but in spite of Dan Gladden.

Other times though statistics back up your gut feelings about a player. The case below is a perfect example.

Karl Malone is going to be elected to the Hall of Fame this weekend. That is no surprise considering his incredible accomplishments over a long NBA career almost exclusively with the Utah Jazz. He is one of the NBA’s best players of all time and when he retired it was common wisdom to tout him as the “best power forward of all time.” This title has since has been unofficially passed along to Tim Duncan. The collective wisdom is that Malone was one of those great regular season players, but Duncan was better in the playoffs and had the 4 championship rings as the ultimate trump card. Everyone seems to remember Malone as someone who would carry a team to the playoffs, but once there he was often disappointing. What Jazz fan can forget the two missed free throws in Game 1 of the 1997 Finals? Or of course the infamous turnover right before Jordan ’s game winning (offensive foul) shot in the 1998 Finals. This epitaph of playoff failure was assigned to his NBA career.

Now do the stats back it up?

We have had plenty of time since Malone retired to forget a lot of games and maybe our memory has failed in us in remembering Malone as someone who didn’t produce in the playoffs. Maybe we remember the bad (the end of Game 6 of the 1998 Finals) and forget the good (Game 5 of the 1998 Nba Finals)? Have we been unfair to Malone? Is he the best power forward of all time? Below is the case for and against:

Karl Malone is the best power forward of all time

When you at Karl Malone’s stats compared to Tim Duncan it is hard to make the case that Duncan is a better player that Malone. Why? Because it is hard to make the case that many players are better than Karl Malone by looking at the stats. He is 2nd all time in career points and 3rd all time in win shares (an estimate of the number of wins contributed by a player) with more win shares than everyone but Kareem and Wilt. Tim Duncan would need 6 more years of his average production to equal Malone. As it currently stands he is still isn’t within shouting distance of the Mailman. However, any Duncan supporter might bring up the fact that of course Malone’s career numbers would be better because he played 19 seasons. If we take that away and just compare averages here are some points in favor of Malone:

• Scoring: Malone averaged 25 points per game. Duncan 21.
• Efficiency: Malone shot 51.6% from the floor and 74.2% from the line. Duncan’s respective numbers; 50.8% and 68.7%
• Reliability: Malone’s work ethic and incredible conditioning was legendary and that shows in the numbers. He played in 99.3% of the Jazz possible games during his 18 year career in Utah . Duncan so far with San Antonio has only played in 94.5% of the possible games. Over an 82 game NBA season that means that Malone would play in about 4 more games than Duncan.
• Longevity: The same conditioning led him to be able to play for so long at such a high level. Not to say that Duncan can’t do that, but let’s see if he is still playing as effectively as Malone was when he was 39 and still contributed 11.1 wins (10th in the league) to the 2002-2003 Jazz team.
• Front line help: Sure this is a little subjective, but I think that playing with the Greg Ostertags and Felton Spencers of the world didn’t help Malone quite as much as playing along side David Robinson helped Duncan.

Tim Duncan is the best power forward of all time

Even the most pro-Duncan fan has to respect and take note of points made above in terms of strong regular season production over a long period of time. However, those battles aren’t something that even really interest Duncan fans since they have the following points in their favor:

• NBA Titles: 4 > 0. While basketball is a team game it is common practice to assign more credit to individual players who help the team win. Duncan ’s teams have won in the playoffs and he has received his share of praise for those accomplishments.
• Playoff Stats: This is where Malone fans might wish the stats contradicted common viewpoints, but unfortunately they don’t. This is where the questions above about how maybe our memory has failed in us in remembering Malone’s playoff performance get answered. Unfortunately for Jazz fans the answers aren’t good and they are the main reason why I think someone can make the case for Tim Duncan being the best power forward of all time. Malone’s numbers dropped across the board from the regular season to the playoffs. He shot considerably worse (from 51% to 46%) in the playoffs and his WS/48 minutes dropped from 0.205 to 0.14. Compare this with Duncan who had almost identical shooting percentages and WS/48 numbers. One thing to consider is that Duncan has more Win Shares (28.6 compared to 23) in the playoffs despite playing in 23 fewer games. Those are just a few stats that I researched, but they all paint a very similar picture. Just like it is hard to make the case that Duncan was better than Malone in the regular season, it is also look like it is hard to make the case that Malone was better than Duncan in the playoffs.

Those are the arguments for both sides. As a Jazz fan I tend to side with the points in Malone’s favor. While the playoff stats was something that was tough to digest (again since I had to live though it the first time) it still doesn’t completely overshadow Malone’s incredible career.

Regardless I would like to congratulate Karl Malone for his induction into the Hall of Fame. You are the greatest power forward in this biased Jazz fan's mind.

The rules of friendship

In sports there are basic rules that are easy to understand and follow. Five fouls in a college basketball game equals disqualification for the rest of the game for that player. Three strikes and you are out in baseball. If any part of the ball touches the line in tennis the shot is in. These rules create order and are necessary for the health of athletics. Maybe that is part of the reason I have been drawn to sports my entire life because unlike others areas there is a certain rationality to sports?

I bring this up because last night I had an interesting conversation with an old friend. He asked me why he wasn't invited to the wedding. This was the first time the topic of not being invited had come up in such a straight forward manner. I assume that most people who weren't invited to the wedding understood the reason or reasons why they weren't on the list. Even if they didn't know why it had never directly come up before because people were probably too passive to actually ask M or I.

It isn't like the question caught be off guard since I knew the reasons why I didn't invite this friend or his girlfriend. Sure the *timing was maybe unusual, but I was actually glad for the question because I had spent a lot of time thinking about it. How did such a close friend of mine go from a potential groomsman to someone who wasn't even invited to the wedding? How did someone who is a easy to talk to, fun to be around and shares a lot of similar interest go from being a friend to a former friend?

*We are a bar downtown Minneapolis and were a few drinks in to the evening.

I told him the reasons why he wasn't invited to the wedding and I hope my message wasn't lost in the loud music at the bar. My message just was I didn't think this person really wanted to be friends otherwise we would have played basketball or hung out together once in the past 6 months. I wasn't trying to be vindictive in not inviting him. There was no ulterior motive. It just seemed like our friendship had gone it separate ways. Whenever I tried reaching out to him he always had something else going on and I don't remember him ever contacting me to do anything.

That is one difference between sports and life that can be very frustrating. While there is order in sports (for the most part) there isn't the same in society. Social norms exist, but they can sometimes be vague and tough to follow. If everyone spoke honestly and with a background of trust then it would much easier to understand people's intentions. One of my groomsmen is easy to be friends with because he is almost always straightforward. If he wants to go to a Twins game then he will tell you that. There is never any game playing or any *white lies as far as I can tell. We have reached that level of comfort that I never have to try and analyze what he says or how he says it. The frustrating thing is that most people don't act that way and I am constantly trying to read into people's intentions.

*I vividly remember the first time my Mom explained to me about a white lie. It was so confusing as a child to grasp my head around the concept.

One thing that I love about M (and no I am not trying to be sappy or romantic in this blog post...I don't want to be that kind of writer) is that it is very easy to know where I stand with her. The first time I kissed her she thanked me. Most people think that is a strange response, but really what was different about her choice of words was that it was completely honest. There was no games being played. She (in retrospect) wanted me to kiss her and was thankful that I did. The end. Again I don't want to be sappy, but that is a unique *quality in a person to be so literal and honest.

*Not to write that there isn't something valuable in someone who can speak at a different level other than literal. Two of my good friends from college are two of the funniest people I know and part of their humor is based on sarcasm, exaggeration and being facetious. It is always fun to hang out with these friends because you are always on your toes.

Anyway, I hope that this unique honest conversation last night with my old friend means that we can move forward. I don't know if we will be friends again, but it was a good start last night. In fact M and I are planning on meeting up with them at the Uptown Art Fair after I received a text from him while I was writing this post.

Mississippi and Marty's wedding

A week ago M and I went back to my hometown of Jackson, MS for my friend Marty's wedding. I reprised my role as a bridesman (like Nancy's wedding 3 years ago) and a amateur videographer. The wedding was great and I am very thankful to have been a part of such a great celebration. The Hitts are like family to me and I wouldn't have missed Marty's wedding for any reason. My top highlights from the trip were:

• Walking Mrs. Hitt (the mother of the bride) down the aisle to her seat.
• Being in attendance for 10-15 speeches from Marty and Matt's friends and family at the rehearsal dinner was very memorable. Specifically Mrs. Hitt gave a great, touching speech about watching Marty grow up.
• Seeing a bunch of people (Rev. Poole, St. Andrew's friends, etc) that I haven't seen in a long time.

And then there was the random highlight that I didn't expect....something that I hadn't ever really thought about as an adult. There was the fact that when I left Mississippi this time I could imagine myself living there again. Now this isn't a revelation that should get any particular blog readers too excited, since it probably doesn't really mean that much. It is just the type of feeling that I never have had before and I would like to try and examine the reasons why.

The main reason that I can think that living in Jackson, MS would be enjoyable is that I no longer think of what living in Jackson is not and instead I just focus on what Jackson is. In the past (when going to college in Ohio or looking for jobs) I had always discounted Jackson because it isn't a big city. It isn't progressive politcally or socially. It isn't something new and exciting. There aren't any professional sports teams in the NBA, MLB or NFL. There isn't even a big university in the city. And then of course there is the huge factor that Jackson isn't a city where there are many jobs for someone with M or I's work background. Jackson is a city that is missing a lot of things that makes living in a city like Minneapolis desirable.

However, when you focus on what Jackson is then you realize that there are a lot of things in its favor. First and foremost I enjoy my family and having my parents, sister, brother-in-law and nephew near by is a huge advantage. However, there are other reasons that have made me think highly of Jackson. There are the incredible people who offer a hospitality that I find lacking in Minnesota. I don't know if is because I have known these people longer, but I just feel comfortable being myself around pretty much everyone there. It isn't a struggle to make friends or feel included. One example is that I can go over to Johnny's place and feel instantly part of his circle of friends.

Also, besides that Jackson offers a city with no traffic and a very affordable cost of living. If we could find a jobs there then it is almost guaranteed we would have more free time, more friends and a better home. We might not have as many options in the city, but New Orleans and Memphis are only 3 hours away. Again I am not saying that it is feasible for us to move to Jackson, but for the first time ever I think that it would at least be considered.