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Fly Fishing Trip Report

Many readers expressed interest in my fly fishing trip with my friend and research partner, Roger Crandell, and asked for details. Here, then, is my first-ever fly fishing trip report.

We began in Lake City, Colorado, the only incorporated municipality in Hinsdale County. It’s the least densely populated county in Colorado, with just 843 residents as of the 2010 census. Tall mountains abound, including several fourteeners. There are few roads. It’s one of the most remote counties in the United States.

We stayed at G&M Cabins, which were great. The woman at the front desk was friendly and helpful, and offered us an upgrade to a two-bedroom cabin for a minor extra charge. The cabin was recently refurbished with modern amenities, but still retains its charm. We could park Roger’s 1999 Toyota 4Runner, with its classic off-road rugged shape he and I both love, which they don’t make anymore, right next to the cabin. We enjoyed a screened porch, sitting area, clean kitchen and bathroom, and separate bedrooms.

We splurged on a gourmet dinner at the only fancy restaurant in town, called Climb. The owner and chef is a perky woman who knows what she’s doing in a kitchen. The wine list is good. The food is delicious. They ran out of seared ahi tuna when Roger tried ordering it the night we arrived. We asked if she would hold a couple of them for the next night, and she did. They were good, and the pork chop I had the first night was excellent.

To add a finishing touch to our gentlemen’s journey, I picked up some whiskey, tequila, margarita mix, cheese, and crackers. Roger found a half-gallon of expired milk for free, figuring it would stay good for the duration of our trip, and some cereal. You can tell who’s the healthier between us: me. Everybody knows whiskey is more nutritious than milk.

After a 7 am breakfast with colorful locals, we went to The Sportsman Outdoors & Fly Shop, where we met our guide for the day, Peter Breeden. I don’t know what good fortune arranged for my first guiding experience to happen with Peter, but I’ll remain forever grateful. Even with nothing to compare him to, I sensed immediately that he knew what he was doing. More important, I liked his manner, the way he explained parts of the art that are second-nature to him by now but were unknown to me. He never became impatient with me, never sighed with exasperation.

We spent that first day on the Lake Fork of the Gunnison River, using nymph rigs the whole day. Nymphs are flies that sink underwater, but not lures because they dangle rather than twirl through the water. Weights help them stay down and an indicator — never a bobber to fly fishermen — on top of the water to help signal when a fish strikes or nibbles. Peter could detect one far more often than I could, suddenly yelling “Set!” at which time I was supposed to jerk my rod in the downstream direction to set the hook in the fish’s mouth. You set in the downstream direction because the fish usually faces upstream.

I wasn’t thrilled with this prospect of setting the hook. I’m not fond of hunting or fishing on the face of it because I don’t like killing animals. However, we were catching and releasing, and using barbless hooks, and everybody assured me that no fish would be harmed on our trip. Sure enough, after witnessing many catches and releases of happy fish back into the current, I relaxed on this front.

The first fish I caught was a 14-inch brown trout. Peter yelled “Set!” and it worked. He yelled “You got him!” and began charging into the water while pulling his net from behind his backpack. I kept tension on the rod by making sure it never came unbent at the tip. When the fish ran, I put him on the reel, letting the drag keep tension while releasing more line to prevent exceeding the test pressure. When I finally got him close enough to Peter, I pulled his head up so Peter could scoop him from the tail end. Then, I made sure my hands were wet to avoid removing his protective mucus coating, and held him up while taking one knee for a photo.

I have several such photos, the hallmarks being a 19-inch cutbow and a 20-inch rainbow trout. That last one was a trophy fish, according to Peter. She was beautiful, too, with complex spotting and mesmerizing hues of color through her scales. I held her gently for the photo, then lowered her into the water, where she waited a moment in my hands, then wiggled forward into still water where she seemed to get her bearings, then off she dashed into the current as if nothing had happened.

Roger and I caught twenty fish that day, which both he and Peter said was a very good day. Peter remarked we worked hard for them, too, continuing to wade upstream to another hole when most of his clients would have taken a rest. It never felt like work to me.

Peter is on the water 300 days per year. He can tie on a new fly faster than I can select one from a box. I practiced my knots with parachute cord before the trip. I don’t advise this. Fishing line is not parachute cord. It’s best to practice with the real thing. With slender fly line, it’s like tying knots in hair, and takes practice. Peter makes it look easy. It’s not. If you’re going to give this pastime a try, be sure to practice your knots with real fishing line and real flies.

Peter is 26 years old. He began fishing when he was 6. His only break from the pastime was a stint in the Marine Corps, which instilled in him a respectful courtesy that comes through on the river. He wouldn’t say, “Come up here.” He’d say, “Step this way, please.” When I verified one of his instructions, such as to cast to a point above a rock by asking, “That rock?” he’d reply, “Yes, sir.” This crisp precision made the day easy to follow and pleasant.

If you want a memorable, worth-every-penny fly fishing trip, I recommend the waters around Lake City with Peter Breeden as your guide. It’s some of the best fishing in North America, according to people who know better than I do, and Peter is as good as guides come.

On our second day, Roger and I headed up to Big Blue Creek in the Uncompahgre Wilderness. It’s neither big nor blue, but its valley in the San Juan Mountains is stunningly gorgeous, with pointy spruce forests as far as you can see, the winding creek through willows and bushes, and cliff faces rising to the sky. We saw nobody else the whole day. We drove deep in, parked, geared up, and hiked the rest of the way to where we’d fish.

Roger took it seriously; I didn’t. I admit it. I wasn’t motivated by the tiny brook trout, and just enjoyed walking upstream in the wild setting. I cast a few times and got a few bites, but didn’t catch anything and didn’t care. Roger did better, but even he never exceeded an 8-inch fish.

Instead of snapping up fish, I snapped photos and stood looking into the sunshine for long stretches. The cool water ran around my feet in Chacos instead of river boots like I’d worn the day before. The air tasted pure. The sky was a dark blue and the clouds vivid white, and the trees so cleanly green I almost couldn’t believe they were natural. In fact, they were real nature, not the thinned-out variety that passes for it in city parks and smoggy outskirts of towns where most school field trips take place. It was the wild that bewitched Thoreau and friends, and it’s still there. Days don’t get better than that one.

From that charmed valley, we drove out to Buena Vista for our third day of fishing. You might assume, like I did, that the town’s name is pronounced with Spanish convention, but it’s not. The locals call it “Byoona” Vista and told us that the quickest way to detect a tourist is to hear them say the town’s name with Spanish pronunciation.

Our cabin was more rustic, a little too much if Roger’s grumbling about the “shower in the dungeon” was any indication. It squeaked relentlessly, making my wee-hour trips to the toilet an exercise in mine-field avoidance to prevent waking Roger. He said he never heard a thing, though, so it paid off — or he’s a sound sleeper.

Our good meals in Buena Vista were breakfasts at a cafe called Evergreen and a locally owned family restaurant called Jan’s, and a dinner at Lariat, a live-entertainment bar in a historic building downtown. Their wine list was even better than Climb’s, which is a hat tip to Lariat rather than a demerit for Climb. A glass of J. Lohr merlot after a day in the wilderness is a moment to pause and give thanks for.

What did not go well in Buena Vista was the fishing. We signed up for a float trip on the stretch of the Arkansas River below town. When I heard “float trip,” I pictured a gentle drift down calm waters with flies and line and the boat all proceeding at roughly the same leisurely pace. When our guide rolled up with a whitewater raft in tow, I knew something was amiss. It wasn’t just the boat, either. The fishing guide reminded me of all the rafters I used to know in Northern California, which is fine when you’re rafting but not so great when you’re fishing.

Down to the put-in at a rafting company’s property we went. Roger took the stern, I was on the bow, and the rapids began immediately. How in the world anybody can fly fish in whitewater rapids is beyond me and was beyond Roger, too. The guide would say “Cast onto that seam!” and we’d do so, only to have the boat turn or the oars get onto our lines, at which point the guide would yell, “You’re under the boat!” or “Keep away from the oars!” or just “Recast! Recast!”

Worse, he had us on nymphs again. What do nymphs do? Sink. What’s beneath whitewater rapids? Rocks, lots of ‘em. It was snag city for Roger and me, and there’s no hope of getting your flies back when the boat is flying past the point of your snag. We lost more rigs on that trip than Roger’s lost in the past couple of years, and then, to top it off, the guide said at about 4 pm, “Jesus. We should be taking out by now but we still have tons of river to cover.” I asked what had been holding us back. “Too many tangles and snags,” he said, and I could feel the air around Roger heat up. When he lost his next rig and the guide asked, “Do I need to pull over and re-rig you?” Roger replied tartly, “Nope. I’ve got it.” The guide never touched Roger’s rod after that.

As if that weren’t enough, Roger was nearly shot by a paintball marksman.

We were floating past a trailer park (How fitting is that?) on a rare calm stretch of water when he felt a disturbance in the air, like a hummingbird near his ear or something. He looked down to find a burst of bright orange paint and the remains of its ball shell on his grab bar. The guide reacted in a way befitting his personality, with vows of aggressive follow-up later and unnecessary explanations of why shooting paintballs at people on rafts is inadvisable. Why, it could result in eye damage. No kidding.

By the time we reached take-out, everybody was exhausted with no notable catches to report. Our only payback for hard time on the water was gear lost, lewd jokes from the guide, relief that both of Roger’s eyes were unharmed by paintballs, and gratitude that the day was over. We considered sending a statement by lowballing the tip, but ultimately decided against it. We’ll just not repeat that part of the river in that manner with that guide, but there was little purpose in causing ripples of unhappiness on our way out the door. We parted with handshakes and well wishes.

By the time Roger and I sat together at Lariat eating dinner and listening to live music, and determining that the owner was Canadian, we could laugh at the day. He told funny stories of combat casting between oars, rocks, and low-hanging trees from a spinning raft. I pointed out that the few fish I managed to catch came from the very parts of the river our guide warned us to avoid because “fish don’t go there.” One thing we could say about the day: We wouldn’t forget it.

At the end of the trip, during our drive from the reverie of rivers and mountains and fish that rise, Roger asked me if I loved fly fishing or hated it. He’d predicted before we went that I’d end up in one of those two camps. “Actually, neither,” I said. I don’t love it as much as he does, but I certainly don’t hate it. I enjoyed all three days in very different ways. By fishing score alone, the day with Peter was hands-down the best, but I discovered that a fishing trip isn’t only about fish. It’s about time with people you want to spend such quality time with. Even the not-so-good ones bring something to it, just as they do in daily life. The wilderness brings even more to it. I loved our fishing trip even though I can’t say I love fishing.

I’ll get better at it, though. I’m going to speed up my knots, work on my cast, get the gear I learned I need and stash the stuff I don’t. I like to keep it lean, very lean, with most of what I need fitting in shirt pockets and a small hip pack, and I prefer river sandals to heavy boots and waders. It’s not about what looks cool or fits some vague notion of magazine standards. It’s about personal preference, and this first trip helped me find mine.

I also learned that nothing has spread more misinformation about fly fishing than the film “A River Runs Through It.” Fish do not start biting early in the morning. They start at about 10 am. Paul’s so-called “shadow casting” technique as shown in the film is beautiful to watch, with all the line furling and unfurling in the sunshine, molecules of water refracting the light, but it doesn’t catch fish. Why? Simple. The odds of catching fish improve when your fly is in the water, not spinning through the air. The point of casting is not to deliver a Cirque du Soleil performance. It’s to present the fly to fish as naturally as possible, and they’re under water.

As for dry-fly purists, Peter put it best: They often purely catch nothing. On some days, like ours on the Lake Fork of the Gunnison, fish aren’t feeding on the surface. If a fisherman is unwilling to switch to something that gets down to where they are on such days, he won’t catch fish.

I would like to thank Roger for arranging the details of our trip, and assure him that I don’t hold our whitewater fishing day against him. He seemed to think it was his fault for selecting that float, but I never saw it that way. The company sold the trip as a float fishing trip, not a whitewater fishing trip, and it wasn’t Roger’s fault for taking them at their word.

If you want to follow in our footsteps on a fly fishing adventure of your own, I suggest you plan well in advance for a stay in Lake City with Peter as your guide. You know it’s in a guy’s blood when you ask him what he does for fun when he’s not guiding fishing trips, and he replies, “Go fishing.” He guides winters in Broken Bow, Oklahoma and summers in Lake City. He’s booked months and sometimes years in advance, so plan ahead. It’ll be worth the effort and the cost.

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The Stock Market is a Social System

In this video, I’ll explain how the stock market is a social system, not a rational system of numbers.

The easiest way to remember why stocks are unpredictable is to realize their prices are driven by human emotion and behavior.

Think of other times when you know human behavior to be unpredictable: kids on a playground, office politics, fashion trends.

It doesn’t matter what a price/earnings ratio “should” be. People can send it wherever.

Benjamin Graham, author of The Intelligent Investor, famously observed: “In the short run, the market is a voting machine; but in the long run, it is a weighing machine.”

Stocks rise over time as earnings grow over time. No indicator helps for short-term timing. No indicator is necessary for long-term investing.


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Are Smart Beta Funds Worth The Higher Cost?

In this video, I’ll explore whether smart-beta funds are worth their higher cost.

Smart-beta funds have become popular. They try to replicate various investing techniques, such as value and growth, with an automated formula.

Here’s how the funds were explained in a March 18, 2017 Buttonwood column in The Economist:

[Excerpt shown at 0:35.]

While it may be true that smart-beta funds are cheaper than active fund managers, it’s important to remember that active fund managers aren’t worth much. Most of them lose to plain Jane indexes.

So, we have to see whether smart-beta funds are worth their higher cost compared with standard index funds.

We’ll use the Russell 1000 index, which consists of the largest 1,000 companies from the Russell 3000 total US stock market index. It’s like the S&P 500, but with 1000 companies instead.

The index is available in its plain form from iShares with symbol IWB. Its smart-beta growth version uses symbol IWD, and value uses IWF. Here are their expenses:

[Chart shown at 2:51.]

The plain Jane index fund, IWB, charges a net expense ratio of just 0.15%, while value (IWD) and growth (IWF) charge 0.20%. Smart-beta is 33.3% more expensive.

Has it been worth it? Let’s have a look.

[Charts shown at 3:40.]

Sometimes value wins, sometimes growth wins, but you can’t know which in advance, so own the whole index.

Which have investors chosen? Value and growth, of course. AUM: IWB $18B, IWD $36B, IWF $34B.


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Japanese Potato Panic

In this video, I’ll look at Japan’s potato panic, and what it shows us about human behavior in the stock market.

In mid-April 2017, Tokyo-based Calbee announced it would temporarily halt sales of 15 types of potato chips due to a bad crop in the key potato-producing region of Hokkaido, which was struck by typhoons last year.

Calbee, which is 20% owned by PepsiCo, commands a 73% market share of potato chips in Japan.

The prospect of a shortage sparked soaring prices, with bags that usually sell for $1.20 going for $12 to $14.

However, as they did, plenty were available.

The possibility of shortage was enough to send prices up ten-fold, and make even people who hadn’t eaten chips in years suddenly desire them like mad!

Calbee and other chip companies are finding back-up suppliers, both inside and outside of Japan. Production will resume.

Therefore, we could say the potato panic of 2017 was irrational. By some angles, it was unjustifiable.

Historically, these prices were too much to pay, but people wanted those chips so it wasn’t irrational to them. Their emotions were goaded by media.

If products as well-known as potato chips can see their market situation change on a dime due to an emotional reaction, imagine those same emotions unleashed in the stock market. Coupled with the 24-hour news cycle, no wonder stock prices fluctuate in unpredictable ways.

Remember this the next time somebody claims to know where stock prices are heading.

The people buying and selling stocks are just like the people consuming potato chips. Weather, news, trends can cause the madness of crowds to take over at any time.

These variables fan the flames of emotion, sending both chip prices and stock prices all over the map. There’s no predicting these short-term moves because there’s no predicting the emotions that drive them.


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Is Higher Education Worth The Cost?

In this video, I’ll look at whether higher education is worth the cost.

Tuition in the United States is soaring. Look at this chart from the American Enterprise Institute using data from the Bureau of Labor Statistics:

[Chart shown at 0:16.]

Naturally, student debt is soaring as well.

The February 2017 Quarterly Report on Household Debt and Credit from the New York Fed:

[Report cover shown at 1:10.]

Reported: “Outstanding student loan balances increased by $31 billion, and stood at $1.31 trillion as of December 31, 2016.” The $31B jump was in Q4 alone.

It’s a growing percentage of overall debt:

[Chart shown at 1:36.]

And its delinquency rate is rising:

[Chart shown at 2:15.]

Why might this be? Presumably, the cost of college is rising because the value of the education it bestows is worth more, right? Wrong.

The Washington Post reported in December 2013 that between 2003 and 2012, the median income of US college graduates with bachelor’s degrees dropped from almost $52,000 to just above $46,000, both in 2012 dollars.

Four years later, how do things stand now?

According to the Class of 2016 Student Survey Report from the National Association of Colleges and Employers, “just over 46% of 2016 graduates received a job offer before graduation, down from 51% from the Class of 2015.” The median salary offer was $47,358, which is 4.9% less than the inflation-adjusted 2012 figure of $48,388.

High cost, high debt, falling compensation = no good.

Television host Mike Rowe put it aptly:

[Mike Rowe quote shown at 4:07.]

Why don’t the jobs exist anymore?

The short answer is that they’ve been outsourced or automated, and the latter trend is picking up steam. Algos and bots are the workforce of tomorrow.

Knowledge is never a waste, but we need to stop thinking about higher education as job training, and reprice it accordingly.


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