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Time is Not Always Money (Farm Safety)

Labor Day morning I woke up and gazed out the window sipping my coffee, when I thought back to four years ago.  That was the last time I’ve had even the smallest of injury.  As I’ve gotten older I take farm safety a bit more seriously.  Becoming a father has also made me more aware of the importance of taking precautions and changing habits.

Proper Set Up

The Labor Day incident involved cutting bulls.  At the time I did not have a squeeze chute.  I just had a head catch at the end of an alley.  I had to climb over the alley fence and get in behind the bull.  I had a friend there helping me, which is out of the norm for me.  After I cut the bull he fired off one good shot with his hind foot and hit me right in the eye.  I had protective sun glasses on and they cut into the side of my face, just a fraction of an inch from the corner of my eye removing a chunk of flesh.  It was a real challenge for the doctor to stitch it back together.  The hole in my head got infected, and when I’d wake up in the morning I’d have a bump bigger than a golf ball that I had to drain daily.  The doc told me he thought the sun glasses may have saved my eye.  This has made me an advocate for protective eye wear that matches the task you are doing.

The take away from this example is I did not have the proper set up for cutting bulls.  Even though it meant I was leaving some profit behind I quit buying cutting bulls until I purchased a squeeze chute.  It was one of the better purchases I’ve ever made, given how many cattle I run through it in a year.  Its hard to justify risking your health because you are cheap like I was.  I might add, that at the time this happened there was no rescue unit service in the near by town because some political muscle flexing shut it down.

Years ago I put in a retrofitted version of a Bud Box onto my facilities.  This allows the cattle to flow nicely into my alley, and I can do it without having to get in with them.

Other People

The worst bumps I’ve ever taken have been while working with other people.  I almost flat refuse to have anyone around while working cattle anymore.  For the longest time I could never figure out why it always went better while I was by myself.  Then last month it hit me, I am having to deal with the pressure they are putting on the cattle.

One day while loading cattle out, the driver was in the corral with me.  In typical trucker fashion he reached up and zapped one with his hot shot.  She kicked me square in the groin at full stroke.   Having been a bull rider for years I know how badly dewclaws can mess a guy up.  I’m not joking when I tell you that it went numb quickly and I felt blood running down my leg.  I had to check to make sure things were still there.  Problem later on was the bruising and swelling.  I had to psych myself up to endure the pain just to take a leak

Now I clearly communicate to my drivers exactly where I want them to stand and what I expect of them.  If they move from that spot or do something out of turn, I just stop.  At these moments time is not money, if it keeps a guy from going to the ER

Take Charge of Your Area

Years ago I was messing around with some recip cows.  I was running them through to synch them one day.  Now I’m one of those guys who knows how I left things.  One day my mom, for some reason picked up the bars I place in the alley to keep the cows from backing up, and placed them vertically along the alley fence.  I kinda spaced that out.  I placed a bar behind one cow and in front of another.  When the lead cow moved forward the cow in back lunged forward too.  She pushed the bar in the alley forward and into one of the bars my mom placed along the fence.  That bar slammed into my forehead with all her weight and force behind it.  The last thought I recall going through my mind was “Don’t hit the ground or you’ll die”.  I came to over at the water hydrant some time later.  I’m not sure how I got there or how long I was there.  Looking at the blood trail I didn’t walk very straight.  I felt fine and went back to finish up.  I lost control of my hands and jabbed a needle through one of my hands when I missed the bottle I was trying to draw from.

From then on, I get upset if someone messes with anything around my working facilities.  Thing is, it is my responsibility to take a look around and make sure everything is in its place.  So now I just do a quick walk through before I bring the cattle up.  Again, time is not money in this instance.

Habits

Habits, we all got them, good and bad.  I kinda have a system to make sure things are in a certain place.  Take my branding iron for example.  Its and electric one so I make sure its in a metal bucket while processing cattle.  Otherwise I know I’d bump into it, trip and fall on it or something.

I now have a place for everything when processing cattle.  This is especially important for me since I’m ambidextrous.  I might perform a task with my left hand, and set it a certain way only to place it differently when I use it with my right.  One day this ended up with me getting a scalpel buried into my under arm

I know a guy who was forced to sell off all his cows a few years back.  He was feeding them a round bale.  He had it up in the air and walked under it to open a gate when the loader gave out and it all came down on him.  He was crushed under it and was pinned there in the mud and cold for hours before someone missed him and went looking.  I am still guilty of doin this.  I try to always remember to walk all the way around it.

One good habit I do have is to never mess around with a PTO.  I was at a youth ag leadership conference once and they spent some time there on farm safety.  They showed us a slide of a boy who stepped over a PTO while it was running and he got caught in it.  The slide showed his testicle sitting on his leg, after his scrotum had been ripped off.  Might seem a bit to graphic for some, but hey, it made its desired impression on me.

Last year my dad’s combine caught on fire.  It went up pretty fast so a fire extinguisher would have been no use.  Thing is after that day, I have a whole new appreciation for those things.

And lastly, as more and more people in this country seem to be popping some kind of pill, I would suggest making a list of the meds you are on and keeping that list on you.  That’s good info for medical responders to have

I know this was a bit long.  With harvest and weaning time coming up, people tend to lose their heads.  Just remember, sometimes time is not money

 
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Posted by on September 10, 2014 in Uncategorized

 

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Where’s the Benefit? (bread & milk)

Last summer I was in a room of about 40 cattle producers from all over the US, with all kinds of different back grounds and strengths.  I don’t think I’ve ever been part of a more diverse group.  One question that was presented to us was “How does your ranch benefit others?”

Right away the first answer was BEEF.  I will say this, that person went home realizing they are a cattle producer not a beef producer.  There were some ramblings about conserving the environment, and taxes.  Then it was just quiet.

This was something I had thought about before, so I spoke up.  I sell and buy cattle all the time.  I need truckers to move them critters down the road.  That driver uses the money he earned from me to pay his taxes, fuel that he bought somewhere, food from a food service establishment that provides jobs to people, tires and other maintenance, insurance, and so on.  What is left over he keeps the lights on in his house and bread and milk on the table for his family.

I buy feed from family and neighbors.  They must make machinery payments, farm payments, maintenance on the equipment, pay for fertilizer, fuel, seed, and so on.  One guy I buy feed from has three kids, all under the age of three.  He forks out a lot of cash for bread and milk.

Don’t forget the mom and pops feed store I do business with.  They got to pay their suppliers, and employees, along with utilities, and equipment, insurance, taxes, and so on.

I buy cattle in sale barns, who obviously have employees, and other expenses.

You’re getting the idea.   A little bit of money gets spread pretty thin and everyone is trying to pay for bread and milk.

A sale barn needs buyers there to establish a market through open price discovery.  As a cattle buyer I have aided in that process many, many times.

One day I was buying cattle and need to recycle my coffee.  I stood at the top the steps for a moment to see what was behind the gate coming into the ring.  In came a small group of three or four heavy four weight heifers, black.  They would fit a deal I had going, and I needed some weight and some average makers. (average makers are the cattle that get bought cheap, to add weight to a load and lower the average dollars/hundred).  I stood there and watched until the bidding stalled, then jumped in.  I hit them three times, and owned them, improving my average.

Now that scene is no big deal to me.  I do that all the time.  Here is why I remember that day so well.  After I left the head, I went to the office and got a recap (recap is a printout telling me how many cattle I have on each of my numbers, what the average weight and average price per hundred is.  Also tells me total dollars spent and total pounds on each number).  This guy comes up to me and thanked me for buying those heifers I just told you about.  I kinda tried to blow it off, and said “you’re welcome”.  He said “No. You don’t get it.  Every little bit helps.”  I  then stepped outside to call a guy I had just finished putting a load together for.  I watched the guy who just thanked me get into a car with a young woman who was feeding a baby.  He showed her the check and gave her a kiss on the cheek before starting the car and leaving.  I bumped them calves about $25/head.  He got about an extra $100 because me and another buyer pushed them.  Having a little one of my own, I know $100 is barely a dent when it comes to bread, milk and diapers.

I’d like to share another example with you all.  I’m totally bragging here, it’s a good one and I had fun doing it.

The last week before all the kids went back to school last fall, one young teenager was sitting in a local sale barn trying to buy a few calves.  One group of calves came in the ring.  This kid started bidding on them.  They were way too low to just sit there so I hit them a few times.  I pushed them to where they were a good buy and a somewhat decent sale price.  Then I pointed at the kid as a sign for the auctioneer to knock them off on him.

Now to set this up a little better there is always some old asshole that never leaves well enough alone.  Back when I was younger and fiercely needed a few breaks, (good buys) this old grumpy fucker would always jump in and run me.  Well he did the same thing to this kid.  He ran the youngster right up to about what the market was bringing for those calves.

The poor kid shook his head “no”  He was out.  Now, I have NEVER jumped back in on bidding on some cattle after I decided I was out.  I had the money to run this old man, and my anger at him for doing that to me when I was younger came out.  I ran him.   I hung those high dollar calves on him.

This exact same scenario was repeated on the next group of calves that came in the ring.  Everyone in the place got the hint.  We were all going to let this kid have a few calves at a good price, or I was going to fuck with you.  The auctioneer is also the owner at that barn and boy was he having fun with the situation.  That kid got all the calves he wanted (about eight) and he swelled up with so much pride I thought the buttons were gonna pop off his shirt!  Next week he was back in school and I was back at the same barn buying cattle.  I made a win/win situation

Gang, I could list tons more examples of how our operations benefit others.  We often times don’t think they do because we rarely take the time to reflect on it.  This is just everyday stuff to most of us, thing is, it matters to somebody.

 
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Posted by on June 3, 2014 in Uncategorized

 

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Face Palm (bread & milk)

Anger is one emotion that really motivates me.  I’ve had some people nudging me for some time to resume blogging.  Last week my attention was brought to an article that appeared on Cattlenetwork.  It was full of some of the worst marketing advice out there.

Here’s a link.  Remember this is bad stuff.  http://www.cattlenetwork.com/e-newsletters/drovers-daily/Worth-the-Weight-259959381.html?utm_content=&utm_medium=eNL&utm_source=1017H7692790D8V&utm_campaign=Drovers+CattleNetwork+Daily_20140521&utm_term=&page=2   You should never read anything in Cattlenetwork and take it seriously.

 

I already confronted the guy quoted in the article.  It didn’t go well.  At one point I even had to ask him if he was even taking the conversation seriously or if he was just messing around!  It became very clear to me in just a few minutes he has no grasp of the North American cattle biz.

Here’s what really bothers me, and is the reason for me writing this.  I am afraid someone somewhere read this article, believed him to be and “expert” and  is following  his advice, which may seriously affect their ability to pay for bread and milk.  I know most people aren’t in the cattle biz to make money, that is clear, thing is there are some people who are really depending on those cattle to earn a living.  That is something you just don’t screw around with!

I told this guy that all his article needed to say was this, “anytime you can turn a profit, DO IT!”  In the article he mentions having leftover feed.  People, as dry as it is in most parts, including where him and I both live, feed in inventory is a damn good thing.  His advice to feed it to put more weight on your cattle based on Value Of Gain (VOG) is, well, just “beep”ing dumb.

There are three legs you need in the cattle biz, cattle, feed, and cash.  If you have all three your business can stand up on its own like a bar stool.  So if you can sell your current inventory of cattle and replace them with undervalued cattle, then you should take the profit and start adding value to those replacement cattle.  You can’t turn a profit and generate cash flow by holding inventory.  Take Walmart for example, they didn’t get as big as they are by holding inventory, or selling for more.  They did the opposite, turn inventory over lots of times and sell it for less, taking small margins lots of times.

Now I totally understand the VOG thing.  I blogged about it years ago on the YPC Cattle Call page.  Thing is it is not something you make a marketing decision based off of.

Now let me explain why this Kat is wrong.  He said the market is signaling that it wants us to put more weight on our cattle.  I sent this guy weighted averages from multiple states showing that just isn’t so.  Hasn’t been for months.  The buyers have been telling us for sometime now that they want to be the ones to put the weight on them.   Our “expert” confessed to me he based his market outlook off of Salina.  You can’t come to a conclusion based off one sale barn, and post it as if it’s a nation wide deal.  I know this for a fact.  I buy cattle in lots of different states in lots of different barns, including Salina.

Since this Kat is from KS and used 7 weights as an example in his article, let’s look at that.  Here is what was written:

In this example, Tonsor pointed out that the feeder cattle market in June compared to May looks to be higher. If the steer sells at a higher price in June when he is 50 pounds heavier, the value of gain (VOG) is projected to be more than $2, around $2.11, which could well exceed the cost of gain (COG) for producers who have access to feed resources.

First off, this guy must be a gypsy with a crystal ball.  I would not want to play cards with this Kat.  Trying to predict/forecast the future, in this case June, is a form of gambling.  Otherwise known as “betting on the come”.  Yeah, that always works out well, playa.  Like I’ve said before, all it takes is a rising market for an idiot to look like a genius.   Don’t even get me started on what he says about December.  I’ll tell you this, feedlots are about to start feeling some heartburn, but you won’t hear anything about that for several months yet.  Maybe feeders will be higher in June.  Maybe not.  Why risk it?  Take the profit

On the weighted average I sent him from KS a 668# steer brought $2.15 or roughly $1430ish/head.  A 728# steer brought $1.91 or roughly $1390ish/head.  What was the signal again?  Wait, I bet we didn’t hold em long enough and feed enough weight on them.   Wrong playa, Thing is, it gets worse the bigger they get.  And its not just KS, its every state.

The weighted averages for most states from last week aren’t posted yet.  Since I actively market cattle on a day to day basis to pay for bread and milk for my family, I will tell you that the market was inverted.  What I mean by that is the market really rewarded lighter cattle.  At one NE barn 650# steers brought over $1525/head.  7 and 8 weight cattle didn’t bring that much money.  SO, if you sold those 6 weights you could buy back replacement cattle that were 50 to 150# heavier, for even money or even had money left over.  Think about that, THE MARKET WAS PAYING YOU TO TAKE WEIGHT HOME!!  You could buy 8 weights for roughly $40 head more than the 6 weights.  Can you put 200# on for $40?  HELL NO.  Hey, where’s our buddy with that VOG thingie?

I don’t know what is worse, the fact that the guy put this garbage out there, the fact that the author wrote it and didn’t stop and say “WTF?”  We can’t blame Cattlenetwork, they don’t have a brain and don’t want one.  Normally this is where I would suggest they all be fired or quit.  I’m not going to do that.  Having been on the receiving end of vocational terrorism just 14 months ago I know how that feels.  It is my sincere wish/hope that these Kats take some time to learn sound marketing skill, and critical thinking skill and share THAT with the world.

Think about this.  Suppose you do what I say, and take the profit and replace with other cattle.  Suppose the other guy is right and the market goes up.  Now you are set up to take two profits and replace again, making it even easier to pay for bread and milk.

 
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Posted by on May 27, 2014 in Uncategorized

 

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Lessons From the Gridiron

This time of year in Nebraska, and probably every where else, conversations always seem to turn to football.  I like the game just as much as the next guy.  I will sometimes listen to the sports nightly shows.  If I’m busy on a Saturday, I have a friend text me updates from the Husker game.   I am now at an age where I have friends whose sons play high school football so I kinda try to keep up with that too.

Now as much as I like the game, I often times think we put to much emphasis on sports in our society.  If  you don’t read this post all the way to the end, at the conclusion I still think we place to much emphasis on sports.  Thing is, I had a conversation with a buddy of mine recently that made me take pause and reexamine that stance.

My friend and I are on opposite ends of the athletic spectrum.  He had talent and ability, I had none.  So our stories differ.

I’ll start with my experience.  My sophomore and junior years in high school I didn’t get to play much at all.  I was in a cast both years before school started so I missed out on most all the season, due to healing and rehab.  I went to all the practices, and games.  Watched it all from the sidelines, while wanting to play, regretting what happened to me to keep me on the sidelines.

My senior year I was healthy, and in good shape.  I loved it.  Everything from the conditioning and especially the hitting.  One big problem though.  I was kind of a small kid, so the underclassmen were about the same size as me, had just as much experience, and were a bit more athletic.  When the season started I got to start on offense and the underclassmen got to start on defense, and we alternated series on either side of the ball.  Our team sucked, I’m not sure if we even won a game that year, so the underclassman got more playing time.  I didn’t like it, it sucked.  But hey, it’s a fact of life

A few games into the season, at a home game no less, they introduced the starting D.  I got to stand there as all my classmates ran on the field when their name was announced.  I got to stand there when the sophomore that I was sharing time with got to run on the field when his name was announced  as well.  Things changed in that game.  Some time during the first half I was playing both ways.  During the second half I never got pulled off the field.

Being from a small town I know how things are.  After the game I took my time leaving the locker room that night, to let the other kids bug out.  I went into coach’s office and asked him if the only reason I was playing was because I was a senior.  He told me I was the only player who gave him 100 during practice and 100 during the games, no matter how bad we were getting our ass whooped.  He pointed out that during the games I miss a few of my assignments, but I never stopped.  If your jersey wasn’t the same color as mine, I was gonna hit you

What I heard was I would never spend another second on the sideline the rest of the year.  All I had to do was give 100 every day.  No matter how much I hurt, how tired I was, or how many times I was gonna puke, 100% every time meant 0% on the sidelines.

My buddy went on to play college ball at a small college.  He had some success there.  One summer he was home.  He’d been working out at the high school gym like a Beast.  Never in his life had he been bigger or stronger.  He was also working physical labor jobs, in the summer heat.  He, like any other kid from Nebraska had a dream of playing for the Huskers.  His plan was to try to be a Walk On.  I never knew that was the goal until just recently.  Here is the disgusting part.  He told some of the local fucktards his goal.  They made fun of him constantly.  They told him all the reasons he couldn’t accomplish it.  Like any of them had a clue.  Problem is, he listened to them.  All those hours of sweat and pain in the gym, eating the right foods, out the window.

He told me just about every time he sees the Husker tunnel walk he puts his head in his hands and tears up.  He will never ever never, know if he could have made it.  You shoulda heard the pain, the regret,  in his voice

Him and I learned quite a bit from the grid iron.

Giving 100 has its rewards.  Nobody regrets doing their best

Quitting lasts forever

 
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Posted by on August 26, 2013 in Uncategorized

 

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Night Out With HSUS

The hardest thing about writing this blog is the opening paragraph.  That is nowhere as hard as what I did last night.  HSUS (Humane Society of the United States) had a town hall meeting in Lincoln NE last night, and I attended.  With all the buzz we hear about them wanting to end animal agriculture you can not possibly imagine how hard it was for me to go.  I am very passionate about what I do and think no one has the right to tell me I can’t do it.  If you are a new reader I am a stocker and back grounding operator.

I was nervous about going and might have not went except I told a couple friends I might go and they told some other people I was going so they all started texting me the day before the meeting. I kinda felt like I had to go at that point.  So I quit working early, put on my clean boots, belt with a rodeo buckle I won, and a long sleeve shirt with my brand embroidered on the right shirt sleeve.  As my wife and I pulled up to the hotel I felt nerves like I haven’t felt in years.

We got there early, the meeting started late.  I felt like I got an interesting “sizing up” from two of the security guards.  Whatever that was about.  One of them needs to find a different tailor, I’ll leave it at that.

I invited several other livestock producers to go with me. All of them turned me down.  My wife and I took our seats, and felt very uncomfortable.  Everyone else in the room knew each other and kinda kept eyeing us.

HSUS Nebraska introduced the people that make up their state Agriculture Council.  One of the cats on the council talked about a Farm to Fitness program they have been working on.  Its where some of their producers deliver meat to local gym for their customers.  Here’s a link to the website http://farmtofitness.com/

John Hansen president of Nebraska Farmers Union, gave a good speech.  I’m not sure how I feel about it even yet this morning.  Thing is John always makes good points when he talks.  He talked about how other farm groups have tried to fight HSUS in other states and lost.  He had stories and data that suggested animal ag should have an open discussion with HSUS.  He made the comment that none of the other livestock groups were there, stating that “they are refusing to put on their big boy pants, and have a discussion”.  I’ll come back to that in a bit

Wayne Pacelle was an excellent speaker, as you might imagine.  He is very good at addressing his critics.  For example, HSUS doesn’t use much money to actually rescue animals.  He had all kinds of footage of the organization rescuing animals.  He never stated how much money they  spend annually, or what percentage of their budget they spend on animal rescue.  He mentioned that he gets asked all the time about doing a ballot initiative.  He continued on that he doesn’t think they have to.  He says the market place is changing with dozens of food chains and grocery stores saying they are only going to sell pork that was produced without the use of gestation crates.  He did make another statement at a differ part of his speech. “ Just because some practices aren’t illegal doesn’t make them right”.  So does that mean HSUS might try seek legislation to ban tail docking for example?  We’ll just have to wait and see.

Here’s what I didn’t expect.  He used a quote from Temple Grandin, and made some of the same points ag groups do.  He spoke about connecting the farm to the consumer, and about transparency.

After his speech I got a chance to speak with Wayne one on one.  As a parent I have great concern about the “one generation and out” quote.  If you are not familiar with that one, it meant one more generation in animal ag then no more.  So that would mean that I will be the last generation to raise cattle and my daughter will not be able to.  His response was simple.  He claims it is a lie that someone made up.  My second question for him was why did HSUS get involved in the lawsuit against the Beef Checkoff.  He stated that NCBA may be misusing checkoff monies to lobby, and that is not what the checkoff is set up to do.  Now gang I’m gonna throw in my two cents in here for a second.  He expressed a little bit frustration with NCBA for blocking the egg bill (the one banning battery cages).  So to me it would only make sense to cut off NCBA’s income stream, checkoff money, if you are HSUS.  What I’m saying is since the cattlemen got involved in eggs, HSUS is gonna get involved with the cattlemen.

Last point on Wayne.  He did tell me he has no problem with cattle production, citing that in all aspects of production, pasture to feedlot, cattle have room to move around and express themselves.  During this time his staff got a few pics of us chatting.  Ok whatever.  Wayne and I shook hands.  I thanked him for his time, and reassured him that I am still looking at him with a crooked eyebrow.

I am not a supporter of HSUS, nor a fan of theirs.  I do not think we need them.  I do think we as livestock raisers do need to continue to improve our stockmanship skills.  I am so sick of hearing ag groups and HSUS argue over methods and practices and science.  Who the f&*^ cares about that?  That stuff has nothing to do with being able to work with animals

Now about our ag groups here in Nebraska.  No excuse for you guys not being there last night.

I joined Farm Bureau because they were the lead dog in the fight against HSUS.  They can’t explain away why they did not stand beside me on the front line last night.

The who’s who of Nebraska Cattlemen were only a few blocks away for the Executive VP’s farewell party.  None of them showed up either.  I find this tragic.  Especially since only a couple months ago they pushed extremely hard for a new state beef checkoff, and said one of the reasons they needed the extra money was to fight HSUS.  Again they can’t explain away why they were not on the front line beside me.  Guess the comments about those of us that are not dues paying members being freeloaders just exited the state

AFAN, We Support Agriculture, and other groups that were created to promote, agvocate, and defend agriculture were not there.  Why not?  Did they not want to boost the head count that HSUS may have used to show as support?  There were probably only 20 people there that were not staff or on the state Ag Council, or their family.

How can these groups claim to represent livestock raisers when they don’t show up?

I think a little confrontation is good.  I’m not saying go there and pick a fight with Wayne.  I am saying get out of your comfort zone.

One last thought.  I learned about this meeting in a livestock publication I receive from South Dakota.  Why did I not hear about it from any of the ag groups in Nebraska?  If we pay money to these ag groups they have a duty to warn/inform us on what’s going on.  Yet these same groups are talking openly about PETA coming to the state fair?

 
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Posted by on June 28, 2013 in Uncategorized

 

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Sleeping Zombies

We have so much technology in the palm of our hands today that enables us to keep connected.  Both to each other, markets, news, sports, and anything thing else our hearts desire.  I sometimes use the internet on my phone to watch a cattle auction to see what calves are selling for in one salebarn, while bidding on calves in the salebarn I am sitting in.  I will exchange text messages with other people I know to see what the market is doing in their corner of the world too.

I stumbled across these points on J.W.R.’s blog.  He used them to illustrate how the corral around the sheeple has been made much smaller by our tyrannical government.  I copied and pasted them here since something else jumped out at me that fits part of the theme of my blog.  Thinking.  Staying informed.

 

Consider the implications of some recent events in America:

• The entire city of Boston is locked down under the equivalent of martial law, and house-to-house searches are conducted in one neighborhood without warrants. No uproar. No publicized post facto inquiries.

•John Corzine is not prosecuted for stealing more than a billion dollars from farmers and ranchers at MF Global. Nary a peep from the mainstream media.  (Nor from the ag world either I might add.  In fact some cattlemen’s groups are still suggesting you hedge.  How fucking dumb! )

•An Out-of-state “Marketplace Fairness Act” sales tax bill is ramrodded through the Senate. No uproar.

•The Fast and Furious scandal results in NO high-level dismissals from the BATFE or Justice Department, even though it was clear that it was ordered from the top. Few people are asking the President: What did he know and when did he know it? No uproar.

•Multiple Benghazi Cover-Ups. No huge Iran-Contra type congressional hearings. No dismissals.

•Asset Forfeiture by the Department of Homeland Security has become institutionalized. Hardly noticed.  (also hardly noticed was the Executive Order signed on March 16 2012, called National Defense Resources Preparedness.  Basically a peace time Martial Law.  So your assets, forget them they are not yours anymore.  But hey, he signed it during some important basketball game)

•Justice Department snooping of Associated Press journalists’ phone records. No uproar.

•The Obama administration intentionally makes the sequester budget cuts as painful as possible by slowing down air traffic control, in a grandstanding move. No uproar.

•Attorney General Eric Holder threatens the State of Kansas for daring to assert its sovereignty. No uproar.

•An amnesty deal for illegal border-crossers is negotiated in the Senate back rooms with a mixture of bribes and arm-twisting, and it now awaits a perfunctory debate and a floor vote. No public outcry.

•Meanwhile, Legitimate hard-working, law-abiding refugees (homeschoolers) who properly applied for visas face deportation. This gets barely any notice in the mainstream press.

•Bitcoin’s main banking interface (Mt. Gox) has its assets seized by the Department of Homeland Security. No mainstream news banner headlines. No uproar.

•Most blatantly, there were revelations of systematic targeting of conservative and Jewish groups by the IRS,–perhaps as many as 500 groups. At last there is some indignant bleating heard, but only because mainstream press deems it “newsworthy.” Few people are asking the President: What did he know and when did he know it?

•And as all of these monumental, riveting events are going on, what is the most sought after news story by Americans querying Google, Bing, and Yahoo search engines? Angelina Jolie’s hooters.

Like I said, we Americans are doing a fantastic job of using all the technology available to us to stay informed.  Gosh we are an intelligent, critical thinking bunch!  Some people fear a zombie apocalypse.   If you ask me its already here

 
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Posted by on May 21, 2013 in Uncategorized

 

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Cattle 529 Plan

Ever since I was a little kid all I wanted to do was farm and raise cattle.  Everything seemed so simple back then.  Just grow up and do what you want to.  We all had that dream.  When you get older, and especially when you have a kid, things get real.

In the last year and a half I have spent way more time in the lawyer’s office and CPA’s office than I care to in a lifetime.  I did not get into the cattle biz to learn all about LLCs, Trusts,  payroll taxes and crap like that.  Thing is I do get to do one money/parent thing I love.  Invest in my kid’s future with nothing other than cattle.

A couple years ago I got fed up with the stock market, and pulled all my money out of my Roth IRA, and used the money to buy cattle.  I’ve had a 20%, or better, return on my money since 2005 with cattle.  My IRA never did that.

So here is my thinking.  As a parent it is always a concern of how to pay for college, even though I would not recommend college, or how to at least give our kids a good start.  After Bernie Madoff ,  John Corzine, and computer generated trades I do not trust the markets.  Thing is I know cattle, so I stick with what I know.

Here is what I’m doing for my kid.  The numbers are based off my last trade just last week.  I know the cattle markets will move so for this example I am going to freeze these numbers for the next 18 years.  Thing is even in the last 8 years I’ve still managed to make a 20% return.  Keep that in mind

I market my cattle on a real time cash flow reckoning, so this allows me to always buy back replacement cattle at a profit.  You will need to learn how to do this in order for what I am about to outline for you to work.

So when my daughter was born I bought her five head of calves.  In this example I am using 480# heifers at $1.43 or $687 head.  So five head would cost a total of $3385.  We are going to back ground these heifers and resell them, and replace at a profit.  So in this example we are selling 730# at $1.33.  My real cost of gain is $.93 with a 2.75# ADG so when I add on a 20% return my cost of gain goes up to $1.15.

The 20% return is a $55/head profit.  Buying 480# calves and selling them at 730# with our rate of gain we get to turn 4 times a year.

Now those first five calves I bought for my daughter are financed through the Bank of Dad (BoD).  So when we do our first four turns in year one the BoD collects all $1100 of profit and subtracts it from the $3385 that was loaned to the new baby.  At this pace the kid pays off the first 5 head by age three and has $84 left over.  After this point we make the kid reinvest their profits into buying more cattle.  So after four more turns the kid will have enough saved up to buy 6 calves.  I think that would make for a pretty proud four year old.

Now I am going to assume you see the pattern here and I don’t need to do all the math for you and show you the year by year turns.

By age ten in this example the kid will have 37 head.  Since there was an income for a minor dad paid the taxes for them.  By now I figure it’s time to secure voter registration, and make the kid a tax payer.  Ouch!  So just figure between Fed and State tax kiss 15% good bye.  Gotta pay for the roads we are using to haul these cattle.  Long before we get to this point, a responsible parent is having/helping the kid pay bills, and balance a check book.  Lots of lessons to be taught here.  I have a buddy doing this with his kids, and it helps them to see there is a purpose in learning math in school.  Also all the lessons that come from helping, do chores.  Some real character building here.

Now by the time the kid is 14 we stop adding more cattle.  We stop at 75 head.  That is enough for a pot load.  Also when we stop at 75 head after the first turn we have the rest of the year to do the other 3 trades and save money.  At 14 what kid doesn’t want a car?  So, let them buy one with their own money.  They will have enough.  Also let them pay for some gas, tax, title, insurance and so on.

Now after the car is paid for with cash, we have a decision to make.  Do we just hold it here with 75 head, or do we keep buying more?

For my example here I stopped at 75 head and just started saving money.

By 18 the kid will have 75 head of cattle worth $72,000 and saved $39,000, and spent $35,000 on car, gas and so on.  So our original investment of $51,500 turned into $146,000 in 18 years.

Now I know the doubting Thomas out there is thinking well you didn’t figure feed and so on.  That was in the cost of gain and subtracted from the dollar difference between selling the 7 weight and replacing with the 4 weight.  Leaving us with the $55 retained profit.  And it took 14 years to get up to a load lot.  This is a crockpot not a microwave.

Now what if we took that $51,500 and invested it into a 529 over 14 years, and stopped and then just let the interest compound for four more years until the kid was 18.  At a 10% rate of return we would have $169,000.

I really think cattle can compete with a 529, IF you market correctly.

This is what I am doing for my kid.  Now according to this example the 529 out performed my cattle plan.  Thing is the 529 didn’t give a sense of accomplishment, or ownership like the cattle do.  The 529 didn’t teach responsibility of paying bills, buying and caring for a car, and cattle, managing cash flow, or understanding where money comes from, and marketing skill.  The 529 didn’t teach the kid how to run a business, and looking at how many animal science and ag business majors corkscrew operations into the ground college didn’t teach that either.

So when my kid is 18 there will be three choices to make.  1) Go to college, keep the cattle and hire dad  to take care of and manage it and use the income for school, or sell them off and go to school, with the goal of graduating debt free.  2) Sell them off and pursue something else.  3) Continue to do the cattle thing.  And I can tell ya with a track record and cash flow like this even at 18 a banker will finance the youngster, with daddy’s supervision of course.

Now suppose I’m half right.  And after 18 years you only have a net of $70,000.  Still pretty damn good.   What if I’m half wrong and by 18 you have $300,000?  Wow!

My kid is two and already owns 6 calves all on her own.  But she gets to take advantage of my buying power too.

Dave Wright President of Independent Cattlemen of Nebraska (ICON) said something to this effect once “I raise kids, the cattle are there to help me teach them life’s lessons”

 
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Posted by on March 11, 2013 in Uncategorized

 

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