Ravi’s Transformer Creations

Ravi is an avid Lego builder and a huge fan of Transformers. Everything revolves around Optimus Prime and his best buddy Bumblebee. When we’re in the car we keep a lookout for both Autobots and Decepticons and wonder what cool mission are they up to in our neck of the woods.

Ravi also likes upgrades and changes to Autobot editions tremendously. He knows the G1 (Generation 1) models from the The Next Generation animated versions from the Dark of the Moon versions from the Age of Extinction versions. While he still won’t watch a live action Transformers movie because he’s too scared he does watch Youtube videos of the new toy models.

Up to a few months ago, we had annual passes to Legoland and we would go monthly. While the rides are okay, what we really used to go to Legoland was for the Adventure Room and the Lego Builders Room. The Adventure Room was a cool walk through attraction that both Ravi and Max fell in love with. The Lego Builders Room is a free space area with basic Legos for kids to build whatever they imagined and a small display area on the side for you to put your creations. It also had a small shop of free Legos that Ravi searched through every trip. It still amazes me that what Ravi (and Max to a minor extent) really wanted to do with their trip to Legoland was to build Lego creations and pick up a couple of cool pieces for their home collection. Almost every trip to Legoland included a couple of hours in the Lego Builders Room.

It is also not far fetched to see Ravi not only want to collect every Optimus Prime toy created, but to also want to build his own cool Optimus Primes with Legos. Below are a couple of his recent creations. It’s also wonderful to see how young kids’ creativity isn’t limited by earlier preconceptions.




No matter how old you get, don’t ever stop creating and inventing.


Love Dad.



Infiltrator Optimus (for those secret stealth missions)!


Trailer Optimus Prime (for heavy duty missions).


Battle Convoy Bumblebee (he’s upgraded to tow tons of equipment to take out heavily fortified Decepticon bases!)



Trailer Optimus, Battle Convoy Bumblebee, and Infiltrator Optimus.



A Rising Interest Rate Environment

If this is the actual long anticipated reversal in interest rates, what does that mean for you and me and what is a  good capital structure for future enterprises? (I believe that even personal finances should be thought out and well-structured. While individuals don’t have the tax situations that company’s have, they have plenty of capital allocation choices that are very similar to what a public enterprise would engage in.) The best place to start that thought is to explore what worked really well in the past. Let’s assume a hypothetical simplified business that makes widgets- Widgets R Us Inc. They require a small amount of cash on hand for day-to-day activities, maintain an accounts receivable and payable and take inventories of widget parts and turn them into full widgets which are then sold on the open market for a profit. We’ll assume some generic facts about the business and show two hypothetical simplified capital structures to illustrate the value of leverage in an inflationary environment and falling interest rates. Take a look at the simplified balance sheet and income statements below:

Widgets R Us Base Case
Widgets R Us Base Case Capital Structure

The terms at the top just govern the basic business structure and environment for Widgets R Us. The Revenue/Assets % is the annual revenue yield expected from total assets in this business and employing a standard distribution of assets for this business (i.e. the right amount of cash, A/R, PP&E, etc. to efficiently turn raw goods into a finished product). The COGS/Revenue is the total expense needed for the operation with the Gross margin simply being 1 – COGS/Revenue. The starting interest expense is the average interest ratio on all of the debt (i.e. Notes Payable and Long Term Debt) the company currently has on the balance sheet. The tax rate is the standard unmodified corporate income rate. We’ve assumed a five year compound inflation rate of 25% which breaks down to an annual inflation rate of 4.564%. Lastly, we assume since interest rates have been falling the company has the chance reissue its debt at a new and lower rate. For our example the 5 year expected interest rate is 8%, while the current one is 10%.

Next follows a very simple balance sheet and income statement. We start with both short term assets (cash, accounts receivable, and inventories) and long term assets (PP&E and Goodwill). Next is the short term liabilities (Notes Payable and Accounts Payable) and Long Term Debt. Finally, assets-liabilities=shareholder’s equity. Notes: Accounts Receivable is money owed to the company from outside sources, Accounts Payable is money the company owes to outside sources, and Goodwill is the excess fair market value over existing asset value).

After that comes a simplified income statement. We earn 40% of the total assets as an annual revenue (i.e. $6,100 is 40% of $15,250). We pay 75% of that as COGS and then pay interest expense leaving us with income before taxes. We then have to pay income taxes leaving us with net income.

The example breaks down the business into two hypothetical capital structures. The first example is with a low leverage ratio. Indeed the total debt $2,250.00 and the shareholders equity is $10,500 as compared to a total asset base of $15,250. The equity in this operation is nearly 2/3rds of the value in the business and very little of this operation is leveraged. In the second case the business is carrying $10,000 in long term debt and $1,000 in short term debt (and plans on maintaining this amount through the next five years). Now equity is a paltry $1,750 or a little over 1/10th of the total asset base of $15,250.

Columns three and four show the business in year five for both example 1 and example 2. IT IS IMPORTANT TO NOTE THAT THERE IS NO ASSUMED ORGANIC GROWTH FOR EITHER EXAMPLE. The businesses still need the required distribution of assets to operate and the only thing that has change is that inflation as increased both the price that goods can be sold at and the resulting price for the assets needed for this operation. We aren’t making the business bigger or changing products or anything else. We are just assuming that prices for everything went up! (The revenue earned increased by 25% from $6,100 to $7,025, the value of the assets needed to do that amount of revenue went up by 25% – Inventories went up 25% from $2,500 to $3,125, PP&E went up 25% from $5,000 to $6,250, etc.)

Once again we aren’t making the business bigger or changing products or anything else. Inflation has boosted our output prices and our required input prices. Nothing else. While most of the assets have gone up in value, some things have stayed the same. Goodwill hasn’t changed, since we really didn’t do any acquisitions, divestitures, etc. Our debt amounts haven’t changed. The low leverage business still carries a total debt burden of $2,250 and the high leverage business still carries a debt burden of $11,000 of combined notes payable and long term debt.

One other thing has changed. In five years we had the opportunity to refinance the debt at a lower rate due to falling rates. The interest we pay on the debt has gone from 10% to 8%; this affects our interest expense line item in the income statement. So what are the five year results for owners of this business solely due to disparate capital structures and an environment we’ve had for the last 30 years? Well there are two numbers that changed dramatically for the two businesses. The first is the amount of shareholders equity. The low leverage business (example 1) grew their shareholders equity from $10,500 to $12,187.52 for a 16% increase in value, but the high leverage business grew their shareholders equity from $1,750 to $3,437.52 for a 96.4% increase! Those shareholders made bank. In addition to the growth in equity, the net income changed due to inflation, but also due to the decrease in interest expense. We see the low leverage business growing their net income by only 21%, while the highly leveraged business grew their income by 106%!

That’s a pretty big difference in 5 years for earnings and equity. And all it took was a serious amount of leverage. It’s also important to note that the low leverage business didn’t keep up with the rate of inflation in either equity growth or earnings growth. If the low leverage business was actually publicly owned (and possibly even if it was privately owned),  the owners would be having a very serious talk with the management team asking them why they were getting paid for sub-par growth. In fact, there probably would have been a distinct pressure to change the situation (by leveraging the capital structure) or by replacing the management team. The second way of righting the business is exactly how Bain Capital makes it money! If you understand that example, you can be as rich as Mitt Romney!

All joking aside, it’s important to see where inflation and reductions in interest rates affect a company’s prospects. Inflation primarily affects the balance sheet. If an enterprise can count on a steady and positive rate of inflation, it can assume a higher leverage ratio and wait for inflation to help juice the shareholder’s returns by counting on the increase in nominal prices for inputs and outputs. On the opposite side, a reduction in the borrowing costs for capital primarily affect the income statement, if the firm doesn’t take advantage of the lowered rates to raise the amount of leverage. In a realistic enterprise, they would definitely increase the amount debt on the balance sheet to maintain the present value of the tax shield asset (pre-tax interest expense reduction in taxable earnings). In our example the constraint was to not allow a change in liabilities; this was done to highlight the effects that have been in place for the last 30 years.

And the last 30 years, in general, have been incredibly good for businesses. The constant reduction in interest rates and the continuous positive rates for inflation have allowed companies to assume higher rates of leverage to increase their rates of return. This is the primary tactic for private equity enterprises. Buy a company with large amounts of debt that are then added to the company’s balance sheet and wait for the operational turn-around (plus inflation and reduction in interest rates) to juice up the equity and earnings so that you can quickly sell. But if the environment changes what happens to Widgets R Us Inc? In the follow up articles we’ll see what happens to the two different businesses when interest rates rise. After that we’ll conclude with some actual advice.



Second Step to a New Backyard — Operation Blank Canvas

Before I can make my fabulous landscape plan a reality, I had to remove the “extra” elements from the existing backyard so we can start from a true blank canvas.  This turned from what I thought as a two step process to something much more complex.  In my mind, I knew I had to remove the trees and the grass, but I totally underestimated the difficulty and the length of time each step requires.

I began Operation Blank Canvas by removing the two trees that I didn’t want to keep, a 6 feet apple tree, and 15 feet cumquat tree.  Let’s be honest; one produces poor quality/quantity apples and the other extremely sour fruits that I have no use for.  I hired my parents’ gardeners for this task.  $300, 3 strong men, and 4 hours later, both trees where cut down and removed.  Unfortunately, the cumquat tree was so large that it left many smaller roots  in the ground that they couldn’t do much about.

Removing the grass turned out to be a more involved task and took many months to complete.  The first step was to kill the grass.  Sounds easy, right?  Not so much in reality.  The instruction from my landscape designer was to generously spray the entire yard with Round-Up, then thoroughly water the entire area when the grass begins to brown.  Spray Round-Up again when new shoots come out, then wait and water, then spray again and water again.  Repeat this spray and water process till there’s no more grass.  Since Round-Up is a systemic weed killer, watering after the initial application is to encourage the unaffected grass to grow, so the new leaves can deliver the next round of Round-Up spray to their roots thus killing the grass or weed.  In theory it was a good plan, but in reality it took many more cycles to kill the majority of grass.

A few weeks after the initial application of Round-Up, I was surprised to see that the grass had barely browned at all!  So I decided in the interest of time I needed to apply another application.  Two weeks later, blotches of grass began to brown but all came back in stride after thorough watering.  Then third and fourth application and watering, but the green grass kept coming back more resilient than ever.  In the end, this battle with the grass took me nearly three months and gallons of Round Up to kill about 90% of grass.

The weather was already getting hot so I gave up on killing grass and moved onto the next step of the project, grass removal.  For this I hired a gardener and rented a large tiller from Home Depot.  Tilling the 50 feet by 50 feet lot itself only took one hour.  The gardener spent the next four hours to hand filtered the grass out of soil.  At the end, he ended up with 15 large bags of dead grass.

Looking back at this part of my garden renovation process, it was certainly the most time consumption and energy draining, not to mention the most boring part of the process.  I admit that I didn’t do my best; all I wanted to do was to move onto something more fun.  Since then I have learned a little more.  The following are my lessons learned from this experience.

Complexity in composition of grass spies increases the difficulties in removing them.  Some grass like fescue develop deep and complex root systems that are hard for chemicals to reach, so it takes much longer to kill them and if you are not diligent they come back.  I find more nut grass around today than anything else and they are very difficult to remove.  Their nut-shaped nodules are buried 10-12 inches deep underground, and unless they are removed the grass just doesn’t go away.

It’s been months since I applied Round-Up to my yard and I am now thoroughly regretting it.  I was uneducated about the chemicals at the time and I should have seek out alternative earth friendly grass removal methods such as solarization.  In my hurry to get to the next phase, I underestimated potential damage chemical had to my soil and future crops.

Another issue I never considered was that grass removal is a long term project.  No matter which grass removal method is employed some will come back and poke their head out of soil.  I have stopped using chemicals now, but simply pull the rogue grass out of the ground. It does not seem to deter them.  I expect that I will be pulling grass for a long time to come.

If I was to do it all again, I would have performed some soil test and added back necessary organic components when I rented the tiller.  It is so much harder to improve soil quality with trees and plants already in the ground.


Rising Interest Rates and Capitalizing on Mortgage Shorting

Buying a primary home is one of the single biggest financial decisions that a person has to make in their life. The decision is further complicated by the fact that this is also one of the few moments where everyone has the ability to leverage 4 to 1 their purchasing potential. This financial situation, like many others, can be seen as an opportunity or risk. Depending on the property you’ve determined to purchase and the cost you’re willing to pay, you have the potential to make a decent return on your investment (or, at the very least, significantly reduce your inflation exposure).

About three years ago, I made the truly scary decision to purchase a property. I happen to live in California where the real estate boom and bust cycles are exaggerated compared to the rest of the country and buying real estate is not a sport for the faint of heart! I felt that I locked in a relatively nice property with development potential that was fairly affordable. At the time we were buying the property, I had a bunch of simple metric to determine whether we would purchase the place or not. Was the PITI (principle interest taxes and insurance) near neighborhood rental rates? If it was then the place was affordable and we could buy.

At the end of 2010 we ended up with our first property and started with an initial loan of 4.25%. To make a long story short over the next three years we did two no cost refinances to lock in a 30yr, 3.5% loan for the place.  These were fairly good deals and each helped me lock in a greater principal savings if mortgage rates rose in the future. Mortgages are like any other bond out there. They have a coupon payment associated with them (monthly PI payment), a term (typically 30 or 15 years), a face value (amount of the bond), and posted collateral (your house). The difference is that when you get a mortgage, you are issuing a bond to the bank against your house. If you invest in the bond market to any degree (by typically holding a bond fund) you are actually taking the role of the bank and acting as the lender/creditor and holding some other corporation/entity’s bond. It’s very difficult for an individual to issue bonds outside of a small business situation and this is one of the few times you get to do this. Locking in a low interest rate is advantageous for the issuer, because if the rate environment rises the lender takes the hit to the par value and you can consider the loss in par value as actual income. In fact, corporations can choose to report in their income statement gains or losses from fair value accounting of assets or liabilities and can record on their balance sheet assets or liabilities at fair value, as opposed to just at principal amount (FAS 157 covers these accounting rules).

What this means is that as interest rates rise, the face value of my mortgage declines and I have made money by locking in an interest rate below prevailing market conditions. Using a simple bond calculator and assuming a $500k loan, I can figure out the book value of my mortgage as mortgage rates rise. For a market rate of 4.5% (current) and a stated interest rate of 3.5% and 29 terms left, the bond calculator states that my $500k mortgage is only worth $420k. In one year and a 1% increase, I’ve made $80k if I was to buy this bond back. If interest rates rise to 5.5% by next year and assuming 28 terms left, the mortgage is only worth $361k. That means I have the chance of making another $79k by holding this mortgage. This is a significant earnings per $500k that a fair number of households will make over the next couple of years.

That’s all well and good, and I believe everyone understands that you will be making money off the bond as interest rates rise, but we might also be a bit more concerned in how much of a reduction in interest expense you gain by holding a lower than market rate mortgage as opposed to current rates. To figure this out I went to a mortgage calculator (http://www.mlcalc.com) and priced three $500k mortgages; one at 3.5%, another at 4.5%, and a third at 5.5%. I then calculated the total interest paid as a function of years for each loan and then calculated the interest expense saved by year. For the hypothetical $500k loan, you’re saving nearly $4k in the first year between the 3.5% and 4.5% loan and nearly $8k in the first year between the 3.5% and 5.5% loan. If you hold the loan to maturity you’ll save $83k on the 3.5% to 4.5% change and $170k on the 3.5% to 5.5% change. I also wanted to know how long it would take me to realize this savings and so calculated a rolling Interest Rate of Change for each rate change. The annual interest expense saved per year divided by the total potential interest saved is then plotted as a percentage over the life of the loan. After 30 years you’ve saved 100% of the potential interest expense and you can see (from the plot below) that they follow fairly similar rates of change. Also note you make 50% of your money back in the first ten years. So as rates rise, do your best to hold your mortgage for at least the next 9 years.



Interest Save RoC

Maxie at 24 Month [Picture]


Maxie at 24 Months

Here’s something funny about the kid in the picture.  Well, let me explain.

You see a kid wearing pajamas laying on top of a briefcase.  What you didn’t know is that this kid was actually wearing street cloth underneath this pajamas.  Somehow he “convinced” his daddy to put his pajamas back on.  He never approached his mother with this idea because he knew mommy wouldn’t allow such non-sense, and of course daddy is such a pushover.

His cute puffy cheeks and even more puffy looking pajamas gave the illusion that he was an average sized kid, but the truth is he fell into 4th percentile in weight at his 2 year check up.  Mommy is worried?  Yes, and there’s plenty of pressure from his grandparents to “add some weight back on”!

Maxie loves to test the limits of his daddy’s patience.  In this particular morning, his daddy needed to leave for work early.  Somehow daddy’s decision went against Maxie’s plan so he withheld the very thing that’s important for daddy’s work.  I don’t remember how it ended, but I am sure he got lots of hugs and kisses regardless his funny ways.


Don’t, Don’t Bite Your Friends!

To my dear Maxie,

You look so sweet and innocent; no one would ever guess that you were a biter.  But you were, like any normal toddler who wanted to explore for themselves what their teeth can do.

Some time ago we heard from your teachers that you have bit 2 different kids in one day.  Somehow one kid put her finger in your mouth, so you bit her; another one tried to take your snack, so bit him too.  I don’t blame you.  If anyone put their finger in my mouth, I would do the same.  Anyone try to take my snack!  Yeah, you got to defend what’s rightfully yours.  Mommy and daddy weren’t mad, especially after hearing that your teachers have determined to work with you to stop the biting.  On the way home, we played and sang along to the “Don’t Bite Your Friends” song from Yo Gabba Gabba to educate you on the etiquette of toddlers.   Just like magic, you stop biting at school, though you did bite your brother on the nose when he took your toys, but we’ll let that slide.

A few days later, we got a note informing us that you got bitten at school.  A few weeks later, you got bitten again.  After that, the topic sank to the bottom of the sea and never surfaced again.  Mommy is very thankful that you were not seriously hurt or hurt others during this arduous period, and that you bite other kids the same number as they bit you.  It is now even between Maxwell and the rest of the world.  The balance has returned.

BTW, we love the “Don’t Bite Your Friend” song and would recommend to any parent of a toddler.  So here it is, for your pleasure.  Don’t forget to come back and visit when your child is going through the same phase. Note that it too shall pass and life will be good againd in a blink of an eye.

Mommy (aka Flo).

Ravi, You Turn 4 Years Old Today!

My Dear Ravi,

No matter how much I prepare myself for this day, I can never be ready.  As of today, you have lived 1,460 days on this earth, and that’s 35,040 hours and millions of minutes.  I have immensely enjoyed countless days and hours, and struggled with a few.   Looking back from this moment, time seems to pass too fast but also too slow.  Too slow, because each day was a different challenge and the difficulty only increased as time goes on.  Too fast, because I have been preparing for this day for months, yet it still  slams into my face unexpectedly like a bug on the windshield.  There were so much I wanted to do to celebrate your birthday, but I have fell short of my own expectation.

Do you know that you are the most influential person to me in my life?  Yes, you are.  You changed my destiny.  Your birth re-arranged my priorities and permanently changed the way I think.  Things that I thought were important are now trivial.  Now I am the happiest than I have ever been, and that’s because I have you, your brother, and your daddy.  So, thank you, for the most precious gift of all, motherhood.  Now that I am one, I can never go back.  My heart will forever walk outside my body.

The most important item in your life is your bunny blankie.  You had it since you were born and you have been obsess with it since you were one.  I can’t believe that blanket lasted the last four years and still in good shape.  I did tried to replace it with similar ones, but it has no alternative in your heart.  You can’t live without it.  Your life is not complete if you are not hold it every waking moment.  There were couple of days we left it at E-Pa’s place, and every night you would get so upset that you nearly cried.

You are very gentle.  Your soft touches have never broken a toy, teared up any piece of paper, or ripped any books.  Your things are as new as the day we got them for you.

Your have been taking dance classes since you were two.  Mommy has yet to witness any progress on the dancing front. The biggest reason is because you never dance in front of me! I keep getting told by the teachers that you go to your dance class every week and you enjoy it a lot, but that seems to be the only place you’ll dance. Daddy and I came to watch you once but you stopped as soon as you saw us! Talk about being really really shy. Oh well, when your older (like 35) maybe then you’ll show us some of the dancing you learned.

You are fully potty trained! And I don’t mean sorta kinda potty trained but the full monty potty trained. You go to the bathroom by yourself, do your business without accidents, and even wait for us to help you if you need it. You haven’t had an accident in months. Which is pretty amazing. Until about a month or two ago you were having a lot of trouble with potty training. We were lucky if you could go a week at school without having an accident and needing replacement pants. There were some days that you had two or three accidents in a single day. When we talked to the teachers, there were hints that either: a) it would all work out, or b) but if it didn’t they’d have to hold you back! That was kind of worrying for us. We told you that you might have to be held back just to make sure you would be prepared for it and you seemed to be ok. We knew it was coming down to the wire, but then, in the end, you turned the corner almost in a week and you haven’t looked back since. You’ve even been able to sleep through the night without accidents, but we don’t take any chances. You still have to wear a diaper to sleep, but that should change sometime this year.

You love transformers. And not just a little, but a lot.  This makes your daddy very proud because he was also a transformers fan. Every couple of weeks he’s looking to get you a new and better transformer. We started with the whole collection of Rescue Bots designed for kids of your age, but quickly moved past that. The next series daddy thought you could handle was the bot shot series. These were designed for 5 year olds, but  daddy got it for you when you were 3. Initially you struggled with the launcher, but then you got it and you and your daddy have been launching transformers at each other regularly at night ever since then.  For your birthday, you have received several KRE-O and other transformer toys that required even higher level of manual dexterity.  So far you can already transform one of them.  During your down time from transforming your robot men, you take a break by watching transformers toys product reviews geared for adults.  As a result, you regularly make requests to daddy for new transformers.  Since last Christmas, you have been able to navigate through youtube all by yourself.  If no one was to stop you, you would continue to surf and watch for hours at a time.  You don’t know the name of the states yet, but you know dozens of transformers names, and often speak to daddy in a language that mommy doesn’t understand, like “open chest” versus “closed chest”, micro changer, weaponry…etc.  I think you must have 6 or 7 different types of optimus primes (which is your favorite character)! You even love making optimus prime and bumblebee from legos. Mommy is really happy you’re so interested in robots and vehicles.  Daddy love it better that you’re always trying to make your own optimus prime as opposed to just wanting someone Else’s build you an optimus prime. Your independence make mommy and daddy very happy!

Hi Ravi,

It’s Daddy here. I just wanted to add my two cents to your 4 year old birthday post. Over the last years you’ve become a very capable, sensitive, and inquisitive little boy. We have tons of fun together and you and I ‘hang out’ and play together regularly. I remember when I was young watching the transformers and thinking that they were so cool. I’ll let you in on a little secret. Your daddy never had a transformer growing up. They were very expensive toys and your grandfather couldn’t afford one for me. Luckily we don’t have that problem today and I am happy to encourage your interest. It’s probably because I have as much fun playing with them as you do. I can’t wait to have you try other games with me and other toys.

You’re definitely getting older and braver. You’ve actually watched me play my video game (Skyrim) and even though it’s a ‘little bit scary’ and people are killed you seem to be able to handle it and enjoy it. The same goes for the Transformers G1 series. While you need me to watch it with you, you do like to watch it and we’ve seen about a dozen episodes. It’s pretty great that you’re getting into shows and games that are for older kids. We even went and saw ‘Wreck It Ralph’ together. Just the two of us. Soon we’ll be playing board games together and then in a couple of years we can start ‘role-playing’. I’m thinking by seven or eight you’ll be able to handle it. I’ve told Mommy that I have no problem being your and your brother’s DM. That will be pretty cool.

You’ve started to get really good at building blocks, legos, etc. You like to build Transformers and other objects from any blocks you can get your hands on. I’ve bought you some Kre-O microchangers Transformers blocks and you love them. While you still need my help, you’ve been able to transform your Optimus Prime all by yourself. Mom and I are very happy you like visually constructing things and have great plans on how we can encourage this hobby and take it to the next level. We see robot building in your future (at least for now)…

While we haven’t started or attempted any formal skill training, we do encourage your hobbies and your inquisitive nature. You’ve learned a lot in the last year and you love exploring and building. These are ‘skills’ that we want you to have more than anything in life. Mommy and daddy believe, if you have no issue with learning, then you’ll be able to learn anything. When your daddy was young he had to ‘learn’ how to do math and to read just to enjoy his hobbies. Those skills came because they were needed for more important endeavors (i.e. fun hobbies). We expect you to learn the same way. So we don’t worry about what you’re learning right now, we just worry about your willingness to learn. Mommy and daddy are planning on getting you more skill games to work with. This will naturally encourage you to learn.



Mommy and Daddy.


Max, You Are 18 Months Old Today!

My dear Max,

You’ve turned 18 months old today.  Oh boy, what a ride it has been!  To think that you are only half way through your second year; what a wonderful adventure it will be to watch you grow.

This is a break through month for you.  You have accomplished so much.  For months now, you have been trying to learn how to flip the light switch or open the automatic garbage can.  These sound like simple things for adults, but pushing just the right spot the first time and then switching to a new spot the second time is little hard to grasp for a little toddler like you.  But you finally figured it out.  All those times that you stood by the light switch feeling, touching, and watching have finally paid off.  Now you still love to sit there, but you now have the satisfaction of watching the lights go on and off.  The same with the garbage can.  Mommy has shown you how to kick the exact spot to open and you have finally done it!  You are also draining the battery by opening it 10 thousand times, but at least you are having fun.

It has taken forever, but the two canine teeth that I felt right under your gum have finally poked through.  My, what sharp teeth you have.  If they come out any longer, it is going to look like vampire teeth, just in time for halloween. You only have a six teeth left and then you’ll have a full set of baby teeth. We can’t wait!

And what do you do with your new sharp teeth?  You bite!  Yes, you!  I am talking to you, Max!  Please do remember that you are not a puppy.  One night out of nowhere you bit me on the shoulder and it hurt like you wouldn’t believe.  I instinctively screamed out in pain.  When I turned around to look at you, you gave me your super cute puppy face and pretended nothing had happened.  Though, you must have sensed that mommy was mad at you so you went elsewhere to play.  Then half an hour later, you climbed up onto the seat behind me, your little arms huged me, your head tilted to one side, and your big inquisitive eyes looked apologetically to implore for my forgiveness.  Of course I forgave you, I couldn’t be mad at you for long.  I thought you have learned your lesson that day, but two days later you bite A-Pa.  Of course A-Pa was a much better parent than I.  He only winced, then pick you up and held you in his arms.  I know, I got much to learn to be a better parent.

You still don’t talk yet.  I know that there are deep thoughts behind your curious eyes, but you certainly have no problem keeping them to yourself.  You say “uhhh uhhh” and “ahhh ahhh”, sometimes you even try very hard to say “milk”.  The doctor tells me this is normal and you are actually speaking, I just blame it on your dad since he didn’t speak till 2!

You are one stubborn kid!  When you were smaller you used to lay face down on the floor when you didn’t get your way.  I thought, what else to expect?  Both of your parents are stubborn, so of course you would be also.  But the bigger you get the more stubborn you become.  There’s no diffusing your obsessions when you are knee deep in it.  No chocolate, new toys, tickle…etc.  You want something and you are obsessed till you get it.  Unfortunately you are often obsessed with whatever your brother has, so Ravi had to give up a lot.  You even hit him sometimes when you don’t get his toys immediately.  I hope this will change because someday you two will be the best friends ever.

The warmth of the summer is fading and made way to this year’s cold and flu season.  If last year’s cold and flu season is anything like the one to come, I am expecting to be sick continuously for the next 7 months.  So far our family had already went though 1.5 round of illness and this is only the beginning.  Of course your daddy and I are expecting to spend all our vacation days on these types of emergencies.

You love to play in bed with brother for hours before falling asleep.  Ever since we put two mattresses on the floor side by side, you have been sleeping with your brother in the same “bed” off and on.  You both love to play in the dark and rolling and falling onto mommy and daddy, which, after a while, tends to hurt us. Both mommy and daddy have noticed that you’re much more involved in playing with your brother. From biking together to swinging together the two of you are pursuing a lot of fun games that we both hope will take up more of your time (and thereby free up some time for us)!

You still cry like crazy during car ride but we can normally get about 15 – 30 minutes before you start. This usually means we keep all of the trips local. If we do take a long trip, like last weekends’ trip to Walnut, the car ride turns into a disaster. We’re hoping that this is just a phase and you’ll become more comfortable in the car. We’re not ashamed to say that mommy and daddy are sort of dreading the trip up to San Jose for Christmas (5+ hours yikes) and we really would like it if you didn’t cry at the top of your lungs the whole way there (hint hint).




Mommy and Daddy.


Max, You Are 16 Months Old Today!


You are 16 months old now!  I can hardly believe its been this long since I brought you home, a tiny baby not even seven pounds.  The nostalgic mom in me wants you to be my baby boy forever.  I often look into your eyes and hope to still find that little boy, but now when you stare back with such a determined and uncompromised look, I know that the little boy has vanished.  In his place, you are a confident and curious boy, ready to take on the world.

You’ve got teeth!  How incredible it is to suddenly find that you have a molar in all four corners of your mouth!  That brings your total teeth count to 12.  You are becoming an adventurous eater.  You are willing to try anything and definitely not shy about showing how you feel about it.  There’s often sounds of “splat” as your rejected food items get banished to the floor, accompanied by your humored laugh as you sensed mommy getting angry.  Sometimes you even pretend to not have done it on purpose, you say “ooh” and looking around for it before you getting back to other victims on your tray.  But you are fair.  You are always willing to try the same thing again, and also drop them to the floor again.

Never in a million years would I have guessed that you would be a bully.  You are a small kid, even compared to kids of your same age.  You must not have taken your size into consideration, as you bully some of your older classmates and sometimes even your brother.  A toy that you want to play with is always yours, no matter who is playing with it.  So you have no problem taking it from a bigger kid.  When you don’t get your way, you cry with real big tears, like the world owes you everything.

One of the most important changes in the last month was that you have finally transitioned to sleeping with daddy.  By doing so, mommy can finally wean you off of breast feeding.  The first two weeks was very tough for daddy, as you woke up every hour and cried, so daddy would get up and rock and sing you back to sleep each time.  Now that you are more used to daddy sleeping with you, you two have bonded.  You guys play games and laugh before you go to bed, and daddy even got a system down to get you back to sleep each night.

Words from daddy:

It has been an adventure sleeping with you and you are so much more capable than a month ago. I rarely have to sing you to sleep these days. These days you will wholeheartedly try to fall asleep all by yourself. You’ll toss and turn all over the beds and slowly gradually fall of to sleep.  I am also impressed by your bravery. If you don’t see daddy, you’ll get up and try the door first (and follow me to the bathroom) instead of just simply crying. At 5 am, you used to wake me up much to early, but you’re getting better. These days you’ll sleep till 6am. I am impressed with the range of emotions and games you’re willing to play. You like to hide things and then search for them. First you’ll pretend you don’t know anything and give us that those upturned hands with a quizzical expression, but then you’ll ‘find’ the thing real quickly and smile.

You and I are starting to ‘hang out’ together. We spent an hour a couple of nights ago shooting basketball in the backyard by ourselves and you don’t mind for going out for walks with Daddy. We have read a couple of books together and I see that occurring on a more regular basis.

You are popular in school. The other kids like to hang out with you and the other parents know Max by name. It’s kind of surprising for Mom and Dad because we know some of the other kids can say more words than you and are taller than you and whatever else. You still seem to have become popular despite these setbacks.

You are fiercely independent and brave. When we go to the daycare, you’ll walk hand in hand with Daddy holding your own lunchbox. Once we arrive it’s off to color, eat a snack, or whatever else without a single look back! And my how you love to color. You immediately go to the coloring paper at school and you’ve been playing with markers and crayons at home almost daily. We think you’ve finally stopped eating them, but Mommy and Daddy still pay attention in the off chance that you might.

As Mom has stated earlier, you are a fighter. You’ve fought with Mom and Dad about riding in cars, about sleeping with Daddy, and over toys with your brother. While you do cry if you lose, losing hasn’t stopped or diminished your fighting spirit. Both Mommy and Daddy find this side of you so at odds with your nature. You are the most laid back self assured little boy we know. You don’t have wild mood swings or wake up in a bad moods or anything else. But you will fight!  And once the fight is over the crying complete you’re back to smiling and laughing. All in the blink of an eye. Daddy suspects that the only reason you cry when fighting is because it’s such an effective tactic when dealing with Mommy and Daddy. Daddy just wants you know that I’m on to you and your wily tricks!! 

 You are a late speaker, maybe in this aspect you are very much your daddy’s baby. The legend has it that your daddy only began to talk at the age of two.  At 15 months you are following your daddy’s foot step.  All you could say are are “ma” and ‘ball”, for your to most favorite thing/person (;-)) in the world.  But in the last week or so you have added “more” to your vocal vocabulary.  Yesterday was your grandma’s birthday.  When we sang her happy birthday, your eyes light up.  For the rest of the night, you kept saying “more”, signaling that you want us to sing it to you again.  We must have repeated that song like 30 times, but it was so worth it.  Each time we sang it to you, you giggled and clapped your hands with such excitement.  You bring so much love and happiness to our family.

My dear Max, you are becoming more independent each day.  It is hard to accept that mommy isn’t the only thing in your world anymore.  But no matter what happens, please remember your mommy and daddy are here for you (except when you’re picking on your bigger brother)!





Mommy and Daddy

Max, You Are 10 Months Old Today!

My dear Max,

You’ve turned 10 months old today!  What an amazing journey we’ve had to get to this point!

Two days after you turned 9 months old, your got your sixth teeth!  That was just so unbelievable!  You pretty much grew five teeth within one month.  The pain that you must have suffered and unable to communicate to me.

Unfortunately, the rest of month was even more painful to you.  At beginning of the month, you suddenly had a high fever of 100 degree C.  For three nights straight you couldn’t sleep.  You woke up so often that the most mommy ever slept in those nights were in 20 minutes stretches.  It was hard getting through those nights.  You couldn’t breath through your nose, so mommy couldn’t nurse you back to sleep.  So often in the night, mommy would pick you up when you cry while half asleep.  Mommy tried to rock you, but you would cry; mommy tried to carry your head on her shoulder, but you would cry.  You would cry when mommy sits down or stops walking… There were so much crying and mommy and daddy were so worried about you.  At one point your nose was so dry that you even had a nosebleed! A couple of days after you finally recovered, mommy got sick, then daddy, then Ravi.  A week later when we visited your pediatrician, we found out you had an ear infection, that explained why you constantly scratched your ear.  A few days after that, you had your second round of fever and it went up to 102 degrees for 3 days!  Mommy and daddy took two days off from work to care for you.  When your temperature came back down, mommy and daddy also experienced another round of really nasty illness too.  And wait, it is not over.  A couple days after that, you, Ravi, and mommy all started to sneeze and cough.  Here we are at the end of the month, all of our family is still sick and wish this cold and flu season will be over soon.

Beginning of this year, mommy and daddy decided to better our lives by upgrading our health insurance to PPO.  This meant we now have the option of choosing a pediatrician from thousands of candidates.  We eventually decided on one from UCLA Medical Center.  It is far from home, but we thought it was worth the effort.  You had your first appointment with him a few weeks ago, right after your first round of illness.  You measured 2 percentile in weight and 20 percentile in height.  Let’s just say mommy was shocked that you were so skinny.  Of course you didn’t eat anything other than breast milk while you were sick, but 2 percentile is even below Ravi’s weight when he was your age.  Did I mention that the nurse weighed you in a wet diaper (because mommy forgot to bring the diaper bag to the appointment)? Mommy is scared to think what your weight is now that you went through two more runs of illness and not eating any solids for days.  While driving home from the restaurant today, mommy asked daddy: “why can’t we raise fat babies?”  Daddy just silently shakes his head.  “It is not in our cards…”

Even with this month-long dose of illnesses, we have been overjoyed with how well you are growing. We have now taken you out to restaurants three times! You have stopped the incessant crying in the car and we can all enjoy a meal out as a family. You love to eat what mommy and daddy are eating (unlike your older brother). We had Peking style duck and bbq pork today for lunch; you had Chinese rice noodle. More important than what we had is that we had it as a family. We are very happy with how you are growing up and your sunny disposition. Ravi and daddy can’t wait to include you in their games. We have plans to take you to the zoo and amusement parks in the next few months. All the fun should start happening very soon!



Mommy and Daddy.