2018-01 Bond Newsletter

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I AM RUNNING A COUPLE OF MONTHS LATER THAN USUAL… in getting out my first bond newsletter of 2018, so our traditional annual end-of-year quiz will be that much more difficult as we reflect back on 2017, but for the sake of tradition we are going to move ahead with our normal news quiz for 2017. Let’s see how good your memory is:
(1) President Trump’s infamous line “You’re fired!” was taken to another level last year, as more than a dozen high-ranking advisers and Cabinet officials were forced out or quit. Name the outspoken White House official who was fastest to be ushered out, after just 10 days.
(2) In June, Trump explained a major reversal of previous U.S. policy by saying, “I was elected to represent the citizens of Pittsburgh, not Paris.” To what was he referring?
(3) After the Trump administration’s first two travel bans were blocked in the courts, the White House added these two non-Muslin nations to counter arguments the order was motivated by animus against a particular religion.
(4) Several Trump campaign associates found themselves in hot water after failing to disclose meetings with the Russian ambassador to the U.S. Name him.
(5) Name the targets of the following tweeted Trump insults:
“The WORST abuser of women in U.S. political history”
“One of the most over-rated actresses in Hollywood”
“The enemy of the American People”
(6) Which airline was widely criticized after security officers were videoed forcibly dragging a screaming, bloodied passenger off an overbooked flight when he refused to give up his seat?
(7) Americans became reacquainted with this 14th-century English term for a senile old person after North Korean dictator Kim Jong Un used the word to insult Trump.
(8) This foreign leader engaged in a bizarre handshake with Trump that turned into a 29-second wrestling match of yanking and pulling in which neither man would let go.
(9) Who coined the phrase “alternative facts” in defending Trump’s insistence that his inaugural crowd was far larger than the photos would indicate?
(10) Which former professional wrestler and current film star touted by columnist on both the Left and Right as a “self-made American hero” and potential presidential candidate in 2020?
(11) How many intercontinental ballistic missiles did the “Little Rocket Man” in North Korea test last year?
(12) There was celebration in the parliament and dancing in the streets when this southern African leader resigned after 37 years in power. Who is he and what country did he lead?
(13) What European region voted for independence, prompting a police crackdown and sending the separatist leaders fleeing to Brussels?
(14) Apple’s iPhone celebrated what milestone last year?
(15) A worker at what major tech firm set off a firestorm of outrage last summer by authoring a memo arguing that hiring or promoting people to create gender and racial diversity is “unfair, divisive, and bad for business”?
(16) Which U.S. state agreed to give Taiwan-based Foxconn $3 billion in tax breaks, subsidies, and other incentives to build a factory there to make LCD panels for TVs and computers?
(17) Which major credit bureau suffered a massive cyberhack, exposing the Social Security numbers, birthdays, and other personal data of 143 million Americans?

THREE MONSTER HURRICANES… and a deadly wildfire season made 2017 the costliest year ever for natural disasters in the United States. The combined cost of Hurricane Harvey, Irma and Maria, plus thirteen (13) other weather and climate disasters was $306 billion.

OUR GROWING NATIONAL DEBT… is $20.5 trillion and rising. To put it in perspective, in sheer dollars, the United States is the most indebted country in the world followed by Japan ($11 trillion) and China ($5 trillion). In relation to the size of the economy, Japan’s debt is the biggest in the world by far. Japan’s debt is more than 240% the size of its economy, with Greece carrying the world’s second largest debt load at 180%. By that same measure, the U.S. sits at 12th in the world. Japan’s debt-to-GDP ratio is so large because its economic growth has largely stagnated over the last twenty (20) years, beginning with the bursting of the real estate and stock market bubble in 1991. Japan has run deficits since then in hopes of stimulating the economy back into growth. But its economy remains stagnant. Japan spends nearly half of its tax revenue on servicing its debt, but so far, the Bank of Japan and Japanese investors have happily continued to buy government bonds. In fact, Japanese traders call betting against these bonds “the widow maker.”

As indebted as the United States currently is, we have not always been in debt. President Andrew Jackson briefly paid off the national debt in 1835, partly with proceeds from lands seized from Native American tribes. Otherwise, the U.S. has been in debt for nearly every year of its existence, beginning with the bill for the revolutionary war. The debt peaked after World War II, ballooning to 119% the size of the GDP in 1946, but it swiftly shrank during the post war economic boom. The debt load bottomed out at about 24% of GDP in 1974 and has been rising ever since. But it was after the great recession in 2007 that the debt really began to explode. The revenues cratered while the government spent heavily trying to stave off economic collapse, including George W. Bush’s $700 billion bank bailout, known as TARP, and Barack Obama’s $787 billion economic stimulus package.

Paying down the national debt to more acceptable levels is a discussion far beyond the room that we have in this bond newsletter, but like it or not, the need to do so will come sooner than later and it will involve restructuring our entitlements.

HOW IS PRESIDENT TRUMP DOING?… Here are the facts, since President Trump took office:
(1) Unemployment has fallen to a 17 year low.
(2) Over 1.9 million jobs have been added.
(3) The stock market has gone up more than $6 trillion.
(4) ISIS is on the run.
(5) New home sales have soared to a 10 year high.
(6) Tax reform has put and will continue to put money back in the pockets of Middle America and will continue to stimulate the economy as a whole.
(7) President Trump is moving towards a diplomatic agreement with North Korea which has been unsuccessfully addressed by four (4) previous Presidents. Negotiating from a position of strength has brought diplomatic results and a renewed respect around the world for our country and our values.

I get the fact that form often overrides substance in the mainstream media as it relates to President Trump and his performance thus far, but his personality and actions have stimulated a social and economic revolution that has and will continue to benefit the social and economic fabric of our country.

AN OXYMORON …is a rhetorical figure of speech in which contradictory terms are combined and are a common part of our language. In that regard, let me point out twenty-eight (28) oxymorons that I have collected and am sure that you could add many more:
(1) Is it good if a vacuum really sucks?
(2) Why is the third hand on the watch called the second hand?
(3) If a word in misspelled in the dictionary, how would we ever know?
(4) If Webster wrote the first dictionary, where did he find the words?
(5) Why do we say something is out of whack? What is a whack?
(6) Why does “slow down” and slow up” mean the same thing?
(7) Why does “fat chance” and “slim chance” mean the same thing?
(8) Why do “tug” boats push their barges?
(9) Why do we sing “Take me out to the ball game” when we are already there?
(10) Why are they called “stands” when they are made for sitting?
(11) Why is it called “after dark” when it really is “after light”?
(12) Doesn’t “expecting the unexpected” make the unexpected expected?
(13) Why are a “wise man” and a “wise guy” opposites?
(14) Why do “overlook” and “oversee” mean opposite things?
(15) Why is “phonics” not spelled the way it sounds?
(16) If work is so terrific, why do they have to pay you to do it?
(17) If all the world is a stage, where is the audience sitting?
(18) If love is blind, why is lingerie so popular?
(19) If you are crossed-eyed and have dyslexia, can you read all right?
(20) Why is bra singular and panties plural?
(21) Why do you press harder on the buttons of a remote control when you know the batteries are dead?
(22) Why do we put suits in garment bags and garments in a suitcase?
(23) How come abbreviated is such a long word?
(24) Why do we wash bath towels? Aren’t we clean when we use them?
(25) Why doesn’t glue stick to the inside of the bottle?
(26) Why do they call it a TV set when you only have one?
(27) Christmas – What other time of the year do you sit in front of a dead tree and eat candy out of your socks?
(28) Why do we drive on a parkway and park on a driveway?

THE NEW TAX LAWS WILL HAVE AN IMPACT ON MOST CONSTRUCTION COMPANIES …not just in the way that you count your “beans”, but in a variety of purchasing and operating activities. The amount of time that I will spend on these tax changes in the bond newsletter will be equal to what I perceive your attention span on this subject to be…very short. My best advice to all of you is to work with your CPAs to determine how your move forward in light of the changes.

Briefly, the Tax Cuts and Jobs Act was passed by Congress on December 20th and signed by President Trump on December 22, 2017. Major tax reform has been 31 years in the making as the last major tax reform bill was passed in 1986 (Ronald Reagan). The act contains many provisions that will have a direct and significant impact on those in the construction industry.

For contractors that are C corporations, the tax rate decreased to a flat 21%, down from a top rate of 35% for taxable years beginning after June 1st of this year. For those companies that are pass-through entities (Sub Chapter S) the top individual rates were decreased from 39.6% to 37% beginning in 2018, so there has not been a significant tax decrease for Sub Chapter S pass-through entities.

The Tax Cuts and Jobs Act left a number of individual tax brackets unchanged (7 to be exact), beginning with the lowest at 10% and the top at 37%.

Although you may have already computed your 2017 taxes, if you have not, it would be advisable to look at the 9% deduction that was available to construction companies that will now expire in 2018. Under the old law, almost all contractors were allowed to take this deduction for construction activities conducted in the U.S. The act unfortunately repealed the deduction starting February 1, 2018. Therefore, it might be well to make certain you are getting the full 9% deduction for 2017.

AT THIS POINT I KNOW YOU ARE PINCHING YOURSELVES TO STAY AWAKE… but just one last important point. Under the old tax law, small contractors (average annual gross receipts of $10 million or less in the three prior years) were able to postpone taxation on income from long term contracts until they were completed or when cash is collected. Larger contractors had to use the percentage of completion method of accounting which requires them to recognize income as the job progresses. Effective January 1st, the act increased the $10 million gross receipts threshold to $25 million. Small contractors affected by this provision can change from percentage of completion to either the completed contract, or the cash basis for contracts started after December 31, 2017. Any contracts started before 2018 would continue to be accounted for under the percentage of completion method.

As I mentioned, there is much more to it and you need to spend some time with your accounting professionals.

IF YOU ARE STILL AWAKE… I would like to introduce Ian Rutherford Plimer who is an Australian geologist, professor emeritus of earth science at the University of Melbourne, professor of mining geology at the University of Adelaide, and the director of multiple mineral exploration and mining companies.

He has published 130 scientific papers, six books and edited the Encyclopedia of Geology. His credentials are impeccable. The reason that I was introduced to Dr. Plimer is the Climate Change – Carbon Dioxide argument that continues to rage. I realize that most of you reading this bond newsletter have drunk the “Climate Change because of increased carbon dioxide” Kool Aid. We have been told the increase in carbon dioxide is the result of burning fossil fuels and other activities of our modern society. According to Dr. Plimer, this is way off the mark. The 2010 volcanic eruption in Iceland, since its first spewing of volcanic ash, has in just four days, negated every single effort we have made in the past seven years to control CO2 emissions on our planet.

Of course, you all know about this evil carbon dioxide that we are trying to suppress – it’s that vital chemical compound that every plant requires to live and grow and to synthesize into oxygen for us humans and all animal life.

I know….it’s very disheartening to realize that all of the carbon emission savings you have accomplished while suffering the inconvenience and expense of driving Prius hybrids, buying fabric grocery bags, sitting up till midnight to finish your kids “The Green Revolution” science project, throwing out all of your non-green cleaning supplies, using only two squares of toilet paper, putting a brick in your toilet tank reservoir, selling your SUV and speedboat, vacationing at home instead of abroad, nearly getting hit every day on your bicycle, replacing all of your 50 cent light bulbs with $10.00 light bulbs…..well, all of these things you have done have all gone down the tubes in just four days!

The volcanic ash emitted into the Earth’s atmosphere in just four days – yes, FOUR DAYS – by that volcano in Iceland has totally erased every single effort you have made to reduce the evil beast, carbon. And there are around 200 active volcanoes on the planet spewing out this crud at any one time – EVERY DAY. Perfect example, Hawaii.

I don’t really want to rain on your parade too much, but I should mention that when the volcano Mt. Pinatubo erupted in the Philippines in 1991, it spewed out more greenhouse gasses into the atmosphere than the entire human race had emitted in all its years on earth.

There is a well-recognized 800-year global heating and cooling cycle, which keeps happening despite our completely insignificant efforts to affect climate change.

Just remember that your government has tried to impose a whopping carbon tax on you, on the basis of the BOGUS ‘human-caused’ climate-change scenario. As you are aware, it is no longer “Global Warming”, it is now “Climate Change”.

Keep in mind, that you might have an Emissions Trading Scheme imposed on you by your government, that will achieve absolutely nothing except make you poorer. It won’t stop any volcanos from erupting; that is for certain.

I cannot argue with the concept that there is “Climate Change”, but it is a natural course of events and has been since our planet cooled and life appeared some 4-5 billion years ago. The controversy, as far as I am concerned, settles around how much impact we humans have on the amount of carbon dioxide in our atmosphere. At the end of the day it is minuscule compared to the amount of carbon dioxide spewed in our atmosphere by natural occurring events. You can all drive your Ford 250s without feeling that you are either warming the world or bringing on another ice age.

Scientists have found large increases in snow accumulation in a vast region of eastern Antarctica, a trend that, if it continues or becomes more widespread, could and probably will lessen the ice sheet’s contribution to the sea level rise and possibly help mitigate one of the most feared consequences of climate change.

The new study, conducted by scientists from NASA and several other institutions, examined snowfall in western Queen Maud Island, an area due south of the southern tip of Africa that is warming rapidly and contains 7 percent of Antarctica’s ice overall.

Based on a more than 500-foot long ice core extracted from the thick sheet of ice and containing a snowfall record dating back 2,000 years, the researchers found that snow accumulation levels had been rising since around 1900, and the rise is most marked in the most recent decades up through the year 2010. The bottom line is that all of the hand wringing and fear over the melting of the ice sheet in Antarctica could, and probably will be compensated for, by extensive snow accumulation levels on the ice sheet which had not been investigated or previously taken into account. Relax, the oceans are not likely to rise significantly and South Florida beaches will still be the same South Florida beaches 100 years from now.

THANK GOODNESS WINTER IS OVER… For many of our friends particularly in the Northeast, it has been a very cold and miserable winter. Even those in New England and the Northeast really do not know what cold is even after a winter like we’ve had. Actually, the coldest city in the world is the capital city (Yakutsk, Russia) of the vast 1.2 million square miles Siberian region known as the Sakha Republic. Yakutsk is widely identified as the world’s coldest city. No other place on Earth experiences the temperature extremes of Yakutsk, Russia. Though temperatures during the very brief summer can exceed 85℃F, winter temperatures regularly fall to -40℃F, and the lowest ever recorded was a staggering -83℃F. If you are tempted to visit Yakutsk, Russia, you should know that everything is ice, fog, and shadows. If you had a camera and wanted to photograph the city during the winter, frost would instantly coat your camera and its mechanisms would freeze to a halt instantly. It is often too cold to break ground for construction or graves, too cold for airplanes to fly or crops to grow. Markets do not have fresh vegetables, but they have very fresh, very cold fish. Yakutsk, Russia has a population of approximately 300,000 and has little, if any, tourist trade (wonder why?).

(1) Do twins ever realize that one of them is unplanned?
(2) If poison expires, is it more poisonous or is it no longer poisonous?
(3) Which letter is silent in the word “scent”, the S or the C?
(4) Why is the letter W, in English called double U? Shouldn’t it be called double V?
(5) Maybe oxygen is slowly killing you and it just takes 75 to 100 years to fully work.
(6) Every time you clean something, you just make something else dirty.
(7) The word “swims” upside-down is still “swims”.
(8) 100 years ago everyone owned a horse and only the rich had cars. Today everyone has cars and only the rich have horses.
(9) Many animals probably need glasses, but nobody knows it.
(10) If you rip a hole in a net, there are actually fewer holes there than there were before.
(11) 100 years ago a $20 bill and a $20 gold piece were interchangeable. Either one would buy a new suit, new shoes and a night on the town. The $20 gold piece will still do that.

(1) My wife and I were happy for 20 years, then we met – Rodney Dangerfield
(2) Marriage is a triumph of imagination over intelligence – Oscar Wilde
(3) Never get married in the morning, because you never know who you will meet that night – Paul Hornung
(4) “I am” is reportedly the shortest sentence in the English language. Could it be that “I do” is the longest sentence? – George Carlin
(5) My husband and I didn’t sign a prenuptial agreement. We signed a mutual suicide pact – Roseanne Barr

PARTING SHOT… When you are down in the dumps and you think you have real problems, just remember: Somewhere in this world there is Mr. Pelosi.

Charles J. Nielson


ANSWERS to quiz – 1. Communications director Anthony Scaramucci 2. Withdrawing from the Paris climate agreement 3. North Korea and Venezuela 4. Sergey Kislyak 5. Former President Bill Clinton, Meryl Streep, the “fake news” media 6. United Airlines 7. Dotard 8. French President Emmanuel Macron 9. Kellyanne Conway 10. Dwayne “The Rock” Johnson 11. Three 12. Robert Mugabe, Zimbabwe 13. Catalonia, Spain 14. Its 10th birthday 15. Google 16. Wisconsin 17. Equifax

02-2017 Bond Newsletter

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MOST TALKED ABOUT POLITICAL TOPIC… on both sides of the isle is “President Trump”.  My Leftist friends (yes I have some) constantly ask me if I am not bothered by Donald Trump’s lack of decorum.  Here is my answer:  We Right-thinking people have tried dignity.  There could not have been a man of more quiet dignity than George W. Bush.  We tried Statesmanship.  Could there be another human being on the earth who is so prized “Collegiality” as John McCain?  We tried Propriety – Has there been a nicer human being ever than Mitt Romney?  The results have always been the same.  This is because, while were playing by the rules of dignity, collegiality and propriety, the Left has been, for the past sixty (60) years, engaged in a knife fight where the only rules are those of Saul Alinsky and the Chicago Mob.

The Left has been engaged in a war against America since the rise of the children of the 60’s.  To them, it has been an all-out war where nothing has been held sacred.  It has been a war they fought with violence, the threat of violence and the violent take-over of the universities — still today.  The problem is that the Left has been the only side fighting this war.  While the Left has been taking a knife to anyone who stands in their way, the Right has continued to act (in most cases) with dignity and propriety.  To Donald Trump, this has all come to an end.  Donald Trump is America’s first wartime President in the “Culture War”.

During wartime, things like “dignity, collegiality and propriety” simply aren’t the most essential qualities one looks for in their warriors.  Ulysses Grant was a drunk whose behavior in peacetime might well have seen him drummed out of the Army for conduct unbecoming.  Had Abraham Lincoln applied the peacetime rules of propriety and booted Grant and maintained George B. McClellan as head of the Union Army, the Democrats might well still be holding their slaves today.  Lincoln rightly recognized that “I cannot spare this man.  He fights.”

General George Patton was a vulgar-talking, SOB.  In peacetime, this might have seen him stripped of rank.  But, had Franklin Roosevelt applied the normal rules of decorum then and appointed General Omar Bradley as Commander of the Third Army (a man with military and political skills, but not a fighter), Hitler and the Socialists would barely be five (5) decades into their thousand-year Reich.  Franklin Roosevelt could not spare the vulgar-talking, SOB because Patton “fights”.

Trump is fighting.  And what is particularly delicious about that, like Patton standing over the battlefield as his tanks obliterated Rommel’s, he was shouting, “You magnificent bastards, I read your book!”  As I said, “Trump is fighting” and he is defeating the Left using their own tactics.

Trump’s tweets may seem rash and ill advised, but in my opinion they have been very effective on a number of different levels.  Trump has managed to isolate CNN.  He has made it personal.  Then, just as Saul Alinsky suggests, he employs ridicule which Alinsky described as “the most powerful weapon of all”.  Most importantly, Trump tweets have put CNN in an untenable and unwinnable position.  They need to respond.  This leaves them with only two (2) choices.  They can either “go high” and begin to honestly and accurately report the news or they can double-down on their usual tactics and hope to defeat Trump with twice their usual hysteria and demagoguery.  The problem for CNN (et al) is that if they were to start honestly reporting the news, that would be the end of the Democratic Party they serve.

So, to all my friends on the Left and the “never Trumpers” as well, do I wish we lived in a time when our President could be “collegial” and “dignified”?  Of course I do.  These, however, are not those times.  This is war and it’s a war that the Left has been fighting without opposition for fifty (50) years.  So, say anything you want about this President — I get it.  He can be vulgar, he can be crude, and he can be undignified at times.  I DON’T CARE, I CANNOT SPARE THIS MAN.  HE FIGHTS FOR AMERICA!  GOD BLESS PRESIDENT TRUMP AND GOT BLESS AMERICA.  I FOR ONE SUPPORT PRESIDENT TRUMP WARTS AND ALL.

“To anger a Conservative, lie to him.  To anger a Liberal, tell him the truth.” – Theodore Roosevelt


BECAUSE OF TRUMP’S UNORTHODOX STYLE AND LESS THAN DIGNIFIED APPROACH… I think his basic message gets lost.  In my opinion, Trump is hitting many if not most of the “hot buttons” of the Electorate, including me.  You have to listen to him and not be distracted by his showmanship and somewhat obnoxious behavior.

I would like to list some thirteen (13) things that I, as a senior American Citizen, want.  Trump is at least talking about issues that most Americans are concerned about.  My wish list is:

  1. Hillary: Held accountable for her previous wrongs!
  2. Put “GOD” back in America.
  3. Borders: Closed or tightly guarded.
  4. Congress: On the same retirement and healthcare plans as everybody else.
  5. Congress: Obey its own laws.
  6. Language: English only!
  7. Culture: Constitution and the Bill of Rights.
  8. Drug Free: Mandatory Drug Screening before and during any Welfare assistance.
  9. Freebies: None to illegals with any type of criminal record.
  10. Budget: Balance it
  11. Foreign Countries: Stop giving them our money and charge them for our help.
  12. Fix the TAX CODE
  13. Respect our Military and our Flag.


OVER THE LAST 25 YEARS… Design/Build contracts have become more common in our marketplace for both public and private contracts.  As a Design/Build General Contractor, if you subcontract the design work on the design/build project to an architect, you are responsible to the owner for any damages the owner suffers because of design errors or omissions.

While there are a number of ways you can protect yourself from the consequences of an architect’s design errors, perhaps the easiest and most inexpensive way is to get the owner to agree to include a contract clause like the one written and used by Construction Attorney J. William Ernstrom, which he called the “skip-over clause”.  By executing the contract with this clause included, the owner agrees that it will “skip-over” you and go directly to the architect for any claims that it has that result from the architect’s professional services.  For those of you that are interested, I am including the Model Contract Clause that you might want to consider including in your contract the next time you have a design/build project, after consultation with your attorney.


FOR THE FIRST TIME IN HUMAN HISTORY… obesity now affects more human beings on the planet than hunger.  New research reveals that as wealth and abundant food spread throughout the world, chronic over-eating has now reached epidemic proportions, putting millions of people at risk for heart attacks, strokes, cancer and other life threatening ailments.  Based on studies encompassing 186 countries, researchers found that the number of obese men have tripled since 1975, while the number of obese women has doubled.  Just 2.6% of the world’s population was classified as obese forty (40) years ago, but by 2014 that figure had climbed to 8.9%, roughly 640 million people.


IF ANYONE IS HAVING A BAD DAY… remember that around this time in 1976 Ronald Wayne sold his 10% stake in Apple for $800.  It is now worth in excess of $58,000,000,000 (that’s right, over $58 billion).


IN CHOAS THEORY… the “butterfly effect” is the name given to the sensitive connection between initial conditions in which an insignificant event in one state in non-linear systems can result in sometimes catastrophic events in the universal state.

In other words, although unlikely, it is possible for a butterfly flapping its wings in Texas to cause a typhoon in the Japanese sea.

Case in point:  In mid-20th century America, a loose 18-year old hippie female in a Honolulu college had sex with an older, alcoholic Kenyan man on a student visa, who had a wife and child back in Africa.  And this less than significant event started the collapse and dissolution of the Unites States of America.


I AM FIRST TO ADMIT… that everything in the bond newsletter is useless, but I still feel inclined to include a section on useless facts:

  1. Each square inch of human skin consists of 60 hairs, 90 oil glands and 19,000 sensory cells.
  2. Edward III passed a law stopping people from eating more than two meals a day.
  3. Electricity doesn’t move through a wire, but through a field around the wire.
  4. Every Continent in the world contains a city called Rome.
  5. Every day more money is printed for Monopoly than the U.S. Treasury prints.
  6. For a while, Frederic Chopin, the great composer and pianist, wore a beard on only one side of his face. It does not matter, he explained.  My audience sees only my right side.
  7. Greece’s national anthem has 158 verses.
  8. It is believed that Shakespeare was 46 around the time that the King James Version of the Bible was written. In Psalms 46, the 46th word from the first word is “Shake” and the 46th word from the last word is “Spear”.
  9. It is physically impossible to sneeze and keep your eyes open at the same time.
  10. It takes 3,000 cows to supply the NFL with enough leather for a year’s supply of footballs.
  11. Since the year 2000 there has been 656 arrests of active NFL players for everything from murder to robbery (and we wonder why the NFL is hemorrhaging viewers).
  12. It takes 60 seconds for blood to make one complete circuit of the human body.
  13. Jimmy Carter was the first U.S. President to have been born in the hospital.
  14. It would require an average of 18 hummingbirds to tip the scale at one ounce.
  15. Pound for pound, earthworms make up half of all animal life.
  16. The highest point in Pennsylvania is lower than the lowest point in Colorado.
  17. The microwave was invented after a researcher walked by a radar tube and a chocolate bar melted in his pocket.
  18. The most common name in the world is “Muhammed”.
  19. The name “Jeep” came from the abbreviation used in the Army for the “General Purpose” vehicle…G.P.
  20. When the University of Nebraska Cornhuskers plays football at home to a sell-out crowd, the stadium becomes the state’s third largest city.
  21. All the clocks in the movie Pulp Fiction (one of my favorite movies) are stuck at 4:20.



  1. Death is the number one killer in the world.
  2. Life is sexually transmitted.
  3. Good health is merely the slowest possible rate at which you can die.
  4. Give a person a fish and you feed him for a day.
  5. Teach a person to use the internet and they won’t bother you for weeks, months and maybe years.
  6. Health nuts are going to feel stupid someday, laying the hospital, dying of nothing.
  7. All of us could take a lesson from the weather. It pays no attention to criticism.
  8. In the 60’s, people took acid to make the world weird. Now the world is weird and people take Prozac to make it normal.
  9. Don’t worry about old age, it doesn’t last that long.


THERE IS TREMENDOUS CONCERN AND DISAGREEMENT OVER… the regulation of firearms and the mass shootings that we have had in this country in the last couple of years.  The Democrats, as a party, believe that gun control is at least a partial answer to controlling and/or eliminating these horrible events.  The NRA on the other hand make a good case for the fact that gun control, particularly in areas where there is the tightest gun control, has had little effect on mass shootings or crimes where a gun is involved.  Chicago, Illinois is a perfect example.

It is interesting to note that –

The Orlando shooter

Charleston club shooter

Fort Hood shooter

Columbine shooter (parents)

Virginia Tech shooter

Colorado Theater shooter

Connecticut school shooter

Congresswoman Gifford shooter

Note: I am not aware at this point in time of the Las Vegas shooter’s political affiliation.

All of these individuals were registered Democrats and by the way, none of them were members of the NRA.

“Status quo, you know, is Latin for “the mess we are in” – Ronald Reagan


THERE ARE TWO STATE STATUES AND ONE FEDERAL STATUTE… that apply to Payment Bonds in the State of Florida.  713.23/713.245 are the Lien Law Bonds and pertain only to Payment Bonds.  255.05 is the State of Florida Statute regulating Payment Bonds on State and Municipal projects in the State of Florida.  It is also applicable only to Payment Bonds.  The third statute relating to Payment Bonds is the Miller Act.  There are no State Statues regulating Performance Bonds.  Performance Bonds are all Common Law Bonds as are all Subcontract Performance and Payment Bonds.  Only entities in privity with the owner in the case of a Lien Law Bond or in privity with the governmental agency can provide either a 713.23 or a 255.05 Payment Bond.  All other Payment Bonds and Performance Bonds are common law instruments.

In the case of a Miller Act Bond, the Federal Miller Act is the authority for Payment and Performance Bonds on projects owned by the Federal Government.  The Miller Act requires a contractor to furnish Performance and Payment Bonds before any contract of more than $100,000 is awarded for the construction, alteration or repair of any public building owned by the Federal Government.  The Miller Act provides that every person who has furnished labor or materials under a contract for which a Payment Bond was issued, but who has not been paid within ninety (90) days of their last day of work, may bring a civil action against the Payment Bond for the unpaid amount.  However, any such action must be brought no later than one year after the last day on which work was performed by the person bringing the action.  No Federal Miller Act case can be adjudicated in State Court.  Federal Courts have exclusive jurisdiction over Miller Act claims.  Actions on Federal Miller Act Bonds must be brought in Federal Court under the Miller Act, which has sole jurisdiction to hear such claims.


THERE HAS BEEN A TREMENDOUS AMOUNT OF ATTENTION… focused on the NFL and what many feel is a lack of patriotism by many of the football players who choose to kneel rather than stand for the National Anthem.  I, for one, have absolutely no sympathy for the NFL or its overpaid, egotistical, narcissistic emotional children that try to entertain us on Sunday.  As far as I am concerned, the football players enjoy, like the rest of us, the freedom we have to express under appropriate conditions, their political views, but not on a national stage where their actions take on a greater significance than they have the right to.  I do not know in what universe the NFL players think that their political and social views could possibly be of any interest to the NFL fan base.  On the other hand, their disrespecting our country’s flag pisses me and most of the country off.  The next time I need a group of idiots to influence my political views, I’ll start listening to George Clooney and the progressives in Hollywood that somehow think that citizens of this country give a f—t about what they think.

Not all NFL players are criminals and not all NFL players are unpatriotic, but as a group, they are a rough bunch to say the least.  Since 2000, there has been 656 arrests for everything from murder to rape.  It is no wonder that the NFL is currently hemorrhaging viewers.

I have never been an enthusiastic sports fan, but if there has been any sport that I have followed to a degree, it has been the NFL.  For the record, they have just lost one more lukewarm fan.


IT IS NO SECRET… that the product that we provide is not universally revered as the most economical and efficient way for a General Contractor to manage the liability and potential default of the major subcontractors on their projects.  The issue has always been what is viewed as the time and efficiency of a surety company’s ability to resolve a claim issue, particularly on the part of a critical path subcontractor on the project.  This perception or reality (depending on which side of the isle you are on) has led to a competitive product called SDI (Subcontract Default Insurance) that has had a tremendous impact on the revenue stream of the surety marketplace.

The Travelers, as well as a couple of other smaller sureties, have finally said “enough is enough”.  They have listened to the concerns of the General Contractors as it relates the claims handling process and Travelers has made the decision to provide a Subcontract Bond form that greatly shortens the time and predictability of the claims handling process.  Key areas of the new form are:

  1. Defined notice and response times on behalf of the surety. The surety has ten (10) days to request details/information, and once the information is fully received, thirty (30) days to advise the obligee of the action they wish to take.
  2. Requiring only a Declaration of Default by the obligee and not both a Declaration of Default along with the Termination Notice in order to trigger the engagement of the surety. This is different than the AIA form which requires the GC or Prime Contractor to go all the way to the termination before the surety is engaged.
  3. Allowing the GC to do certain things to mitigate the sub’s work in a default situation, and recover for these costs should the surety find the subcontractor in default.
  4. Also, allowing change orders (up to 10% of the subcontract) to automatically increase the bond amount, addressing something that is often misunderstood.

As a General Contractor who would prefer to utilize Subcontract Bonds rather than SDI either on all their projects or on specific subcontractors, Travelers Subcontract Bond form should be a requirement as far as I am concerned.  Until this form has been vetted out by the sureties that are writing the subcontractors, there may be some pushback because it does put a greater claim burden on the subcontractor’s surety in case of a potential claim.  I think this is the very point and the very issue that we need to deal with if the surety companies are going to maintain their clients rather than lose them to a SDI provider.

If you have any questions on this bond form, I would be happy to discuss it with you.  If you desire a copy of the Travelers bond form, please advise me and I will be happy to send it to you.


THE SOUTH FLORIDA CONSTRUCTION MARKETPLACE… continues to be the best construction market in the Eastern United States and one of the best in the country.  Although we may see some flattening of the condo market in the next couple of years, we anticipate that even that market will be back in full force by 2019 to 2020.  In the meantime, the construction market, as a whole, continues to be extremely vibrant, particularly the infrastructure marketplace.  All of us who travel the South Florida roads and highways are well aware of the fact that we need more public transportation and we need significant improvements in our highways to accommodate the continued growth in our communities.  It is highly unlikely that any contractor in the South Florida marketplace will want for work in the next five (5) years.  As a matter of fact, the greatest challenge that most contractors will have will be to accommodate the financial organizational and employment issues associated with the amount of work available to them.  In line with that, contractors who work in the public sector or who need those occasional bonds in the private sector, maintaining a single and aggregate bonding line of credit that will accommodate their needs is an essential element in allowing them to grow.  Nielson, Hoover & Company is the largest surety broker in the Southeast United States and it is not by accident.  We deal on a daily basis with 70+ different sureties, we have the greatest number of account executives who specialize only in providing surety credit and we have, by far, the greatest base of customer service representatives (CSR) that deal on a daily basis with the service and clerical needs of our accounts.

I get the fact most of you have a relationship with an insurance agent and at one level or another with a surety market.  I can assure you, that given the opportunity, we can improve your entire surety credit package.  When we sit down together, we will be addressing your single project capacity, your aggregate capacity, your indemnity package and the premiums that you pay.  It would be hard to argue, that based upon our size financially and organizationally, that anyone does it better than we do.  I would like the opportunity to prove that to you.  Please give me a call, and depending on where you are domiciled in the State of Florida, I will connect you with one of our surety bond specialists who will review your current program and allow us to compete on your business.  You compete every day to the business that you get, there is no reason that your insurance agent (surety broker) should get a free ride and not have to compete for your business.


PARTING SHOT:  Interesting Tidbit.  Hmmmmmm.

The President-elect won the election with less than 40% of the popular vote but had the majority of electoral votes.  The Republican Party had put forth a candidate to win several crucial states that could swing the electoral college.  The election was a bitter one with the Democratic Party fractured between two candidates.

The incoming President received so many death threats that he chose to arrive in Washington in secrecy.  The security for the inauguration was the tightest ever with troops stationed in buildings throughout the day.  This was an unprecedented amount of protection for any President-elect.  Many members of Congress chose not to attend the ceremony.

Despite all of this……Abraham Lincoln was sworn in as our 16th President on March 4, 1861.

Charles J. Nielson


2017-01 Bond Newsletter

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UNBELIEVABLE!!!… I believe that I am among the majority of Americans who were both shocked and in some cases dismayed by the results of the November 8th Presidential elections. As I pointed out in my October 2016 Bond Newsletter, Hillary Clinton was the most unacceptable candidate that has been on a Presidential ballot or any other ballot in my lifetime. I also pointed out that I had no idea what Donald Trump represented, nor was I convinced that he had the temperament to be President of the United States. Continue reading 2017-01 Bond Newsletter

2016-02 Bond Newsletter

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 THE COLOR OF OUR NEWSLETTER REFLECTS MY MOOD… as it relates to the upcoming election.  For those of you who have read our previous newsletters, you know that I am politically just slightly left of Attila the Hun.  I feel politically claustrophobic because no matter which way I turn feel trapped in a political nightmare.  I haven’t felt this bad since Barry Goldwater lost to Lyndon Johnson.

 I know exactly what Hillary Clinton is and what she represents and I find her the most unacceptable candidate that has been on the ballot in my lifetime.  I have absolutely no idea what Donald Trump represents and even though he is running as a Republican and does share some of my Republican populous views, he wanders too far off of the path on certain issues.  I am willing to throw the dice and go for Donald Trump.  As unacceptable as he may seem in some ways, I seriously doubt he is capable of screwing up the next four years in a way that only Hillary Clinton can and probably will.

 If you had asked me six months ago, three months ago or even a month ago, I would have said that Trump didn’t stand a chance, but once again it appears that my prognostications as it relates to this election may continue to be wrong as they have over the last nine months.  Therefore, I am taking the cowards way out and truthfully indicating that I have no idea.  Frankly, it is too close for anyone to call at this point in time.


BASED UPON THE FAILED PRESIDENCY OF THE LAST EIGHT YEARS AND THE POTENTIAL DISASTER THAT WE ARE FACING FOR THE NEXT FOUR YEARS… most of the population will be seeking liquid relief in one form or another.  In this country, beer is the relief most often self-administered in times of stress.

Based upon that, as a service to the bond newsletter, I thought that the least I could do would be to educate our readers on this essential liquid.

BEER IS THE THIRD MOST POPULAR BEVERAGE IN THE WORLD…coming in behind tea and water.  Monks brewing beer in the Middle Ages were all allowed to drink five pints of beer a day.  Bavaria still defines beer as a staple food.  The oldest known written recipe known to man is for beer.

In English pubs, ale is ordered by pints and quarts.  Therefore, in old England, when customers got unruly, the bartender used to yell out at them to mind their own pints and quarts and settle down.  That is where we got “mind your P’s and Q’s.”

It is a well documented fact that one of the reasons the Pilgrims landed at Plymouth Rock in 1620, rather than sail further south to a warmer climate, was because their supplies were dwindling, “especially our beer.”

ALL BEER CAN BE DIVIDED INTO TWO CATEGORIES: ALES AND LAGERS.  There are then numerous subcategories of different “styles” that fall under both categories:

  • ALE – Ales are top fermented beers that are brewed at warmer temperatures. They tend to be fairly complex and flavorful with fruit and/or floral tones.  Most ales are full-bodied and rich in taste.
  • LAGER – Lagers are bottom-fermented and brewed at lower temperatures. They are typically easy drinking, light in body and mild in taste, with a clean flavorful and crisp finish.


 AMBER LAGER – full flavored with more hops, malt and overall character than pale lagers.

  • AMERICAN PALE ALE – gold to amber in color with flavor and aroma centered around the citrus and pine character of American hops.
  • BELGIAN BLONDE ALE – light-colored Belgian ale with a spicy hop nose and perfumy or honey-like aroma. Light complex finish.
  • BELGIAN STRONG ALE – can vary from pale to dark brown in color and is medium to full-bodied, with a high alcohol character. Includes Tripels, Dubbels and Abbey ales.
  • BELGIAN WHITE – also known as “Witbier” or “Weissbier,” white beers are made from wheat.
  • BOCK – a strong, malty lager typically of German origin with a low hop presence and rich, toasty malt characteristics.
  • BROWN ALE – ranges from deep amber to brown in color, with caramel and chocolate notes. They tend to be strong and malty with an even level of “nuttiness.”
  • ENGLIGH ALE – a golden to reddish-amber ale with enhanced hop bitterness, balanced with malty aromas.
  • HEFEWEIZEN – a German style of wheat beer. “Hefe” means “with yeast,” which adds unique flavors of banana, apple or cloves with a dry, tart edge and some spiciness.
  • INDIA PALE ALE – commonly abbreviated as “IPA,” this version of a pale ale employs a significant amount of hops originally to help it make the voyage overseas. The added hops give a strong floral note with high bitterness, complementing a higher alcohol content.
  • PALE LAGER – pale to golden colored lagers that are dry, clean-tasting and crisp with subtle flavors.
  • PILSNER – a type of pale lager with a more prominent hop character that takes its name from the city of Plzen in the Czech Republic. Nine out of ten beers consumed today are based on the original pilsner from 1848.
  • STOUT – Stouts are dark beers made using roasted malt or barley. The dark roast gives the beer its unique toasty or coffee-lake taste.
  • TRIPEL – Originating from Trappist Monks in Belgium, the Tripel is complex and wonderful creation. Using “triple” the malts with an even balance of hops, these beers are deceptively strong.  Bright and gold in color with a spicy, floral and slightly sweet finish.

 “Without question, the greatest invention in the history of mankind is beer.  Oh, I grant you that the wheel was also a fine invention, but the wheel does not go nearly as well with pizza.” – Dave Barry

 “I feel sorry for people who don’t drink.  When they wake up in the morning, that’s as good as they’re going to feel all day.” – Frank Sinatra


 ONE OF THE MOST IMPORTANT LEGAL ISSUES… that we deal with on a continual basis is the issue relating to the Statute of Limitation in our state.  Four years ago in a 2012 bond newsletter I outlined some of the issues with the Statute of Limitations.  Because these issues continue to plague us, many times because of lack of understanding, I am going to take the liberty of repeating that article to hopefully give some clarity to the issues with the Statute of Limitations:


  • The relevant Statute of Limitation is found in Section 95.11(2)(b), Florida Statutes which provides for a five (5) year Statute of Limitation for actions on any contract or written instrument (obviously a bond is a written instrument) (Note: The prevailing case is Federal Insurance v. Southwest Florida Retirement). It is important to understand that 95.11(2)(b) refers to Performance Bonds, not statutory Payment Bonds.  Therefore, the Statute of Limitation on any Performance Bond in the State of Florida will have a five (5) year limit on the ability of any potential claimant to file a claim against the contractor or the surety.


  • There are two (2) Florida Statutes that defines the Statute of Limitations in the State of Florida for Payment Bonds. The statutes are 713.23 and 255.05.  These statutes limit the liability of the surety to lawsuits filed within one year of the completion of the work by the claimant.  These are obviously Statutory Bonds, not Common Law Bonds.  Therefore, a subcontractor, for example, working on a project where the General Contractor provided a Statutory 713.23 or 255.05 bond to the project owner is subject to the one year Statute of Limitation for filing suit under the bond with certain limited exceptions under 255.05.  In the event that a subcontractor has furnished a payment bond to the General Contractor, claimants under the subcontractor’s payment bond have five (5) years to advance a lawsuit.  UNLESS the General Contractor has also furnished a payment bond on that same project, in which event the statute of limitations is likewise limited to one (1) year.  Under Section 713.23(1)(a), the statute states that “any form of bond given by a contractor conditioned to pay for labor, services and material used to improve real property shall be deemed to include the condition of this subsection.”  Therefore, whether a bond in the State of Florida given to a contractor conditioned to pay for labor, services and material refers to 713.23 or not, it is still deemed to be a Statutory Payment Bond.


  • Various municipal owners have been inserting Florida Statute 95.11(3)(c) in their bond forms. 11(3)(c) is both a Statute of Limitation and a Statute of Repose.  It limits the right of the owner to sue the contractor (and some may argue, the surety as well) to ten (10) years.  The typical reason for including this statute would be to give extended coverage for latent defects.  Under 95.11(3)(c), the owner has four (4) years from the time of discovery of a latent defect to sue the contractor and/or surety company under this statute, but they are limited to ten (10) years to make any claim.  As an example, if three (3) years after the project was completed, the owner discovers a latent defect and notifies the contractor, the owner still has four (4) years in which to sue for latent defects.  Under that scenario, the total time that is allotted under 95.11(3)(c) would be seven (7) years.  On the other hand, if the latent defect is found within the ninth year after the building is complete, there is only one year to sue based upon the ten (10) year limit of liability under 95.11(3)(c).  As in the case of 95.11(2)(b), this statute refers to the Performance, not the Payment Bond.  Latent defect issues are performance issues, not payment issues.  If  it is a Statutory 713.23 Payment Bond, the right to sue is limited to one (1) year as it is in the case of a 255.05 Statutory Payment Bond (public projects).  From a common sense standpoint, a latent defect issue would not be a payment issue, but a performance issue, so adding that statute to the Payment Bond would make no sense.


         We are all aware of the fact that the surety industry has not been willing to deal with the ten (10) year limit to bring suit against them under 95.11(3)(c).  There are a number of ways to address the issue.  The most obvious is to delete that from any Performance Bond that we issue.  The second approach has been to maintain the statute in the Performance Bond, but to limit the surety’s liability to five (5) years (Miami-Dade County).  This, however, still leaves the contractor liable for ten (10) years, five (5) of those will not be accompanied by their “surviving partner” (surety).


It is a shame to be enjoying a great retirement ten (10) years later and have a subpoena served to you on the golf course for a potential latent defect on a project you completed ten (10) years before.  It is a risk that each contractor has to assess on their own.



 THERE ARE A NUMBER OF WAYS YOU CAN DEFINE THE SOCIAL AND ECONOMIC CONDITION …of our society.  I think the following statistics are a real eye opener to what we have become:


  • California – New Mexico – Mississippi – Alabama – Illinois – Kentucky – Ohio – New York – Maine – South Carolina.


These 10 States now have More People on Welfare than they do Employed!!!


  • In July, the Senate Budget Committee reports that fiscal year 2012, between food stamps, housing support, child care, Medicaid and other benefits, the average U.S. Household below the poverty line received $168.00 a day in government support. What’s the problem with that much support?  Well, the median household income in America is just over $50,000, which averages out to $137.13 a day.  To put it another way, being on welfare now pays the equivalent of $30 an hour for 40 hour week, while the average job pays $24.00 an hour.


  • A recent “Investor’s Business Daily” article provided statistics from a survey by the United Nations International Health Organization:


  • Percentage (%) of men and women who survived a cancer five years after diagnosis:

U.S.                  65%

England            46%

Canada             42%

  • % of patients diagnosed with diabetes – received treatment within 6 months:

U.S.                  93%

England            15%

Canada             43%

  • % of seniors needing hip replacement who received it within 6 months:

U.S.                  90%

England            15%

Canada             43%

  • % referred to a medical specialist who see one within one month:

U.S.                  77%

England            40%

Canada             43%

  • Number of MRI scanners (a prime diagnostic tool) per million people:

U.S.                  71

England            14

Canada             18

  • % of seniors (65+), with low income, who are in “excellent health”:

U.S.                  12%

England            2%

Canada             6%

  • And now…for the last statistic: National Health Insurance?

U.S.                  NO

England            YES

Canada             YES


  • Check the last set of statistics!! The percentage of each past president’s cabinet…who had worked in the private business sector…prior to their appointment to the cabinet.  You know what the private business sector is: a real-life business…not a government job.  Here are the percentages:


38%      T. Roosevelt

40%      Taft

52%      Wilson

49%      Harding

48%      Coolidge

42%      Hoover

50%      F. D. Roosevelt

50%      Truman

57%      Eisenhower

30%      Kennedy

47%      Johnson

53%      Nixon

42%      Ford

32%      Carter

56%      Reagan

51%      G. H. Bush

39%      Clinton

55%      G. W. Bush

  8%       Obama


         This helps explain the bias, if not the incompetence, of this current administration:  ONLY 8% of them…have ever worked in private business!  And these people are trying to tell our corporations how to run their business?  How can the president of a major nation and society, the one with the most successful economic system in world history, stand and talk about business when he’s never worked for one?  Or about jobs when he has never really had one?  And, when it’s the same for 92% of his senior staff and closest advisers?


         They’ve spent most of their time in academia government, and/or non-profit jobs or as “community organizers.”



IT IS AMAZING AS YOU LOOK ACROSS THE COUNTRY… how well many of the states and cities have done economically and socially under the Republican administration.  It is also interesting to note how many states and cities are in both economic and social turmoil under liberal Democratic rule.  No comparison makes that more obvious than what I will call A TALE OF TWO CITIES:






2.7 million

2.15 million


Median HH Income




% African-American




% Hispanic




% Asian




% Non-Hispanic White




Pretty similar until you compare the following:





Concealed Carry – Legal




# of Gun Stores


184 Dedicated gun stores plus 1500 – legal places to buy guns – Wal-Mart, K-mart, sporting goods, etc.




Homicides, 2012






Homicides per 100K






Average January high temperature (F)




Conclusion – Cold weather causes murders.  This is due to global warming.




AS A CELEBRATION TO THE BEGINNING OF FOOTBALL SEASON… I am including some football quotes/humor:


  • “I make my practices real hard because if a player is a quitter, I want him to quit in practice, not in a game.” – Bear Bryant / Alabama
  • “It isn’t necessary to see a good tackle, you can hear it!” – Knute Rockne / Notre Dame
  • “The man who complains about the way the ball bounces is likely to be the one who dropped it.” – Lou Holtz / Arkansas –Notre Dame
  • “When you win, nothing hurts.” – Joe Namath / Alabama
  • “A school without football is in danger of deteriorating into a medieval study hall.” – Frank Leahy / Notre Dame
  • “There’s nothing that cleanses your soul like getting the hell kicked out of you.” – Woody Hayes / Ohio State
  • “In Alabama, an atheist is someone who doesn’t believe in Bear Bryant.” – Wally Butts / Georgia
  • “I never graduated from Iowa. But I was only there for two terms – Truman’s and Eisenhower’s.” – Alex Karras / Iowa
  • “Football is NOT a contact sport, it is a collision sport. Dancing IS a contact sport.” – Duffy Daugherty / Michigan State
  • After USC lost 51-0 to Notre Dame, his post-game message to his team was, “All those who need showers, take them.” – John McKay / USC
  • “The only qualifications for a lineman are to be big and dumb. To be a back, you only have to be dumb.” – Knute Rockne / Notre Dame
  • “I’ve found that prayers work best when you have big players.” – Knute Rockne / Notre Dame
  • Ohio State’s Urban Meyer on one of his players: “He doesn’t know the meaning of the word fear. In fact, I just saw his grades and he doesn’t know the meaning of a lot of words.”
  • Why do Tennessee fans wear orange? So they can dress that way for the game on Saturday, go hunting on Sunday and pick up trash on Monday.
  • What does the average Alabama player get on his SATs?
  • How many Michigan State freshmen football players does it take to change a light bulb?   That’s a sophomore course.
  • What do you say to a Florida State University football player dressed in a three-piece suit? “Will the defendant please rise.”
  • How can you tell if a Clemson football player has a girlfriend? There’s tobacco juice on both sides of the pickup truck.
  • Why did the Tennessee linebacker steal a police car? He saw “911” on the side and thought it was a Porsche.
  • How do you get a former Illinois football player off your porch? Pay him for the pizza.




IN OUR WORLD… capacity and service are the two ingredients that have made us the number one surety brokerage firm in the southeast United States.  If we currently do not have the privilege of servicing your surety bond credit needs, let’s talk.





“Opportunity is missed by most people because it is dressed in overalls and looks like work” – Thomas Edison



Charles J. Nielson


2015-02 Bond Newsletter

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WE MIGHT AS WELL GET IT OVER WITH… the question on everyone’s mind, both Republican and Democrat, is who will be the Republican nominee for President? Although the general election is a year away, you can be certain that we will know long before then who the Republican nominee will be. Unless Hillary Clinton is indicted for issues relating to the email scandal, or there are some extraordinary development or revelation regarding the Benghazi situation, Hillary Clinton is the presumptive Democratic nominee. First of all, there is an attitude among many Democratic faithful that it is now “her turn”, particularly after the beating that she took at the hands of Obama. Add to that the power of the Clinton political machine and it is easy to see why she has both the backing and support that she currently does. Because of that, there has not been a rush among potential Democratic contenders to seek the nomination. The only one with any stature at all is Bernie Sanders and in my opinion he is not electable. He does have the enthusiastic support of the far left, but he would fall far short in a national election. 

No one seems to like Hillary Clinton that much and almost 70% of those polled think that she is dishonest. No doubt about the fact that she has no personal charisma and is highly unlikable, yet she stands as the presumptive Democratic nominee…go figure.

On the Republican side, no one six months ago would have or could have predicted what is taking place as it relates to potential Republican nominees. When Donald Trump announced his candidacy, most did not take him seriously and many felt offended that such a man could actually seek the Presidency of this great country. Since that time, Trump’s candidacy has become more of a reality and even though some refuse to accept the fact that he could be nominated or even elected as President, the truth is both may be the case.

To understand how and why this is taking place, we will have to recognize that this is not a political issue, it’s a social issue. We Americans, for the last 200 years have felt, and rightly so, that we are “an exceptional people”. We have proved it fiscally, militarily and socially. No country has come even close to providing its citizens with the necessities of life, the freedoms that we enjoy each day, the opportunities financially and socially and most importantly, the lack of any government tyranny in our lives. This is, without question, an exceptional country and we are an exceptional people. 

When Barack Obama was elected President, he did so apologizing to the world for the way that America had conducted itself domestically and internationally. He promised that we would no longer be the bullies that we had been and that we would lead the fight for freedom from behind, which is another way of saying we will no longer lead.

Most of us now feel that Obama has marginalized who we are and what we stand for. It is impossible for us not to feel that we are an exceptional country and an exceptional people and when we look at our place in the world now, most of us are upset and highly indignant.

Because our national dignity has been compromised, we want it back and we feel that the only way we can get it back is to elect a “winner”. We are frustrated with the gridlock in Washington and frankly we want a John Wayne or a Clint Eastwood figure to “kick some butt” and bring back our national dignity. We feel like it is our God given right to lead and most of us are tired of feeling compromised.

In my opinion, if the candidacies of Donald Trump and Ben Carson lose traction and steam, the most likely insider to win the nomination would be Marco Rubio.

It takes courage at this point in the election cycle to make any predictions. In the 2012 Presidential campaign cycle, former Texas Governor, Rick Perry, was leading the Republican field by 1.7 points. At this point in 2008 cycle, Hillary Clinton was leading Barack Obama by 15.6 points, while Rudy Giuliani was leading the GOP field by 10.7 points. Nothing on either the Republican or Democratic side is like anything that we have ever experienced before, so only time will tell.


FOR GLOBAL WARMING DOUBTERS… please note the following article in the Washington Post (important to read the article through the end):

The Arctic Ocean is warming up, icebergs are growing scarcer and in some places the seals and finding the waters too hot, according to a report to the Commerce Department yesterday from Consulate, at Bergen, Norway. Reports of fishermen, seal hunters and explorers all point to a radical change in climate conditions and hitherto unheard-of-temperatures in the Arctic zone. Exploration expeditions report that scarcely any ice has been met as far North as 81 degrees 29 minutes.

Soundings to a depth of 3,100 meters show the Gulf Stream still very warm. Great masses of ice have been replaced by moraines of earth and stones, the report continued, while at many points well known glaciers have entirely disappeared.

Very few seals and no white fish are found in the Eastern Arctic, while vast shoals of herring and smelts, which have never before ventured so far north, are being encountered in the old seal fishing grounds. Within a few years it is predicted that due to ice melt the sea will rise and make most coastal cities uninhabitable.


THIS REPORT WAS FROM NOVEMBER 2, 1922 AS REPORTED BY THE A.P. AND PUBLISHED IN THE WASHINGTON POST 90 YEARS AGO. I think we all want to treat our planet with respect utilizing the resources that have been made available to us with wisdom and understanding. We, however, cannot let our government utilize a natural reoccurring climate change as a basis for controlling and taxing unnecessarily the citizens of this country. There are countries, such as China, where extreme pollution is causing death and unnecessary environmental damage. This needs to change.

We need to be cautious about how we react to the data supposedly gathered by scientists around the world. We know for certain that the earth has not warmed on a consistent basis as the reports originally prognosticated. Is our climate getting warmer? Perhaps it is, but if you go back to the mid-70s, science was predicting that we were going to be entering another ice age. Admittedly July 2015 was officially the hottest month since records began in 1880 with an average temperature of 1.46 degrees higher than the average for the twentieth century. It was 0.14 degrees above the previous hottest month which occurred in 1998. Since 1998, there have been years in which the temperatures have gone down and others in which they have gone up, so any predictions by the scientists are highly suspect and once again, we need to careful not to give our government too much power to regulate and tax based upon very inconclusive climate information. 

“Never argue with an idiot, because bystanders don’t know who the idiot is.” – Mark Twain

“Nobody will ever win the battle of the sexes. There is just too much fraternizing with the enemy.” – Henry Kissinger

I know I am guilty of taking on the Democratic Party, so as a matter of equality, I would like to provide you with quotes from great orators of the Democratic Party of the past and of the great orators of the Democratic Party today. First, the past:

“One man with courage makes him a majority.” – Andrew Jackson

“The only thing we have to fear is fear itself.” – Franklin D. Roosevelt

“The buck stops here.” – Harry S. Truman

 “Ask not what your country can do for you; ask what you can do for country.” – John F. Kennedy

Great orators of the Democratic Party today:

“It depends on what your definition is of ‘is’?” – President William Jefferson Clinton

“Those rumors are false. I believe in the sanctity of marriage.” – John Edwards

“What difference does it make?” (RE: Benghazi) – Hillary Clinton

“I invented the Internet.” – Al Gore

“America is, no longer, uh, what it, uh, could be, uh, what it once was, uh, and I say to myself, uh, I don’t want that future, uh, for my children.” – Barack Obama

“I have campaigned in all 57 states.” – Barack Obama (quoted 2008)

“You don’t need God anymore, you have us Democrats.” – Nancy Pelosi (quoted 2006)

“Paying taxes is voluntary.” – Senator Harry Reid

 “Bill is the greatest husband and father I know. No one is more faithful, true and honest than he is.” – Hillary Rodham Clinton (quoted 1998)

“You have a business. You didn’t build that. Someone else did!” – Barack Obama (quoted 2012)

“We just have to pass the healthcare bill to see what is in it.” – Nancy Pelosi (quoted March 2010 – as one doctor said: That is also the perfect definition of a stool sample)

I am sure it gives all of us a sense of comfort to know that we have such brilliant minds in charge of our once-great country. As John Wayne once said: “Life is tough! It’s even tougher when you are stupid.”


WE ALL KNOW THAT THE INFORMATION CONTAINED IN MY BOND NEWSLETTER IS USELESS … so adding another section of useless facts certainly does not diminish its value:

  1. In Ancient Greece, women counted their age from the date in which they were married, not from the day they were born.
  2. In Egypt, in 1500 B.C. a shaved head was considered the ultimate in feminine beauty. Their women removed every hair from their heads with a special gold tweezers and polished their scalp to a high sheen with buffing cloths.
  3. In Elizabethan slang, the term “to die” meant to have an orgasm.
  4. In India, it costs less to have sex with a prostitute than it does to buy a condom.
  5. In medieval Thailand, they had movable type printing presses. The type was made from baked oxen dung.
  6. As most of you have probably already figured out, in space, astronauts can’t cry because there is no gravity, so the tears can’t flow.
  7. In the United States, a pound of potato chips cost 200 times more than a pound of potatoes.
  8. Leonardo Da Vinci could draw with one hand and write the other – at the same time.
  9. If #8 above was not amazing enough, Leonardo Da Vinci spent 12 years painting the Mona Lisa’s lips.
  10. Most guys who wear jeans have had a pair of Levi 501 Jeans. Ever wonder where the number 501 comes from? 501 was the original stock number for the original jeans in the first Levi’s store.
  11. Shakespeare was the first to use certain words that are now common, including – hurry, bump, eyeball and anchovy.
  12. The state with the highest percentage of people who walk to work: Alaska.
  13. The animal that can last the longest without water is the rat.
  14. A hippopotamus can run faster than a man.
  15. 100,000 years ago, the human gestation period was 15 months rather than the current 9 months.
  16. Most useful and interesting of all useless facts is that 54% of Americans prefer to fold their toilet paper rather than wad it.
  17. It is virtually impossible to sneeze with your eyes open.
  18. February 1865 is the only month in recorded history not to have a full moon.
  19. Ever wonder why tiger sharks are aggressive? The embryos of tiger sharks fight each other while in their mother’s womb, the survivor being the baby shark that is born.
  20. The electric chair was invented by a dentist. No wonder it took 8 minutes for the first victim electrocuted to die.
  21. The Eisenhower Interstate System requires that one mile in every 5 miles must be straight. The straight sections are usable as air strips in times of war or other emergencies.
  22. The inventor of the flushing toilet was Thomas Crapper.
  23. The phrase “rule of thumb” is derived from an old English law which stated that you could not beat your wife with anything wider than your thumb.
  24. The word “girl” appears only once in the bible.
  25. The word “Hallelujah” is common to all languages. It is never translated.


LIVING IN MIAMI-DADE COUNTY IT IS EASY TO TAKE THE CITY OF MIAMI FOR GRANTED… but for the past eight (8) years, Knight Frank distributes an annual Wealth Report which is a collection of data about the global UHNWI (Ultra High Net Worth Individuals), defined as those who have US$30 million or more in net assets. In the most recent 2014 report, the cities that matter most to UHNWI’s were:

  1. London – Condos are selling in London for $6,000 psf.
  2. New York – Condos are selling for $4,000 psf.
  3. Singapore – Condos are selling for $1,500 psf.
  4. Hong Kong – Condos are selling for $4,500 psf.
  5. Geneva – Condos are selling for $3,000 psf.
  6. Shanghai – Condos are selling for $2,000 psf.
  7. Miami, Florida – Condos are selling for $800 psf.

What is most interesting about the report is that in 2009 Miami was the 29th most important city, in 2011 Miami was still #29 in the same rating, but in 2013 Miami’s ranking raised to #8 and in 2014 Miami is the 7th most important city to UHNWI’s.

There is no question about the fact that the condo market is the main real estate financial driver for our real estate/construction economy, in not only Miami, Florida, but for Miami-Dade County as a whole. The Miami Herald published an article in May of 2005 projecting that 62,000 condos were planned for development within the Brickell Avenue/Downtown Miami corridor. In actuality, just 17,502 of those proposed 62,000 condos were developed, less than 40% of what is projected.

In tracking the data of Miami – South Florida current cycle, we found that the number of proposed new condos is, once again, different from the number of condos that have actually been brought to market for sale thus far. Currently, the estimated number of new “proposed” condos East of I-95 in Miami-Dade, Broward and Palm Beach is between 38,000 and 45,000 units. Of those, approximately 16,000 to 18,000 have been brought to market for sale since the last business quarter of 2011 (42% of the 38,000 “proposed”). To date over 62% of the inventory has been sold.

Although there is reason to believe that the case of building and selling condominiums in Miami-Dade, Broward and Palm Beach County may be slowing, there is less than 10,000 new condo units remaining to be sold and this is approximately 18 months of new condo inventory for sale, according to historical absorption patterns.

 Back to the vitality of the City of Miami for a moment. In North America, the top five (5) cities of importance to UHNWI’s are:

  1. New York
  2. Miami
  3. Washington, D.C.
  4. San Francisco
  5. Toronto

There is no questions about the fact that Miami has long outgrown its value as simply a depository for scared South and Central American money and has become a worldwide destination. Based upon the last information I was able to obtain, last year over 90% of the condos sold in Miami-Dade County were sold to other than US Citizens.

Our position as a banking center for the Southern hemisphere is unquestioned. 53 banking offices hold $12 billion in domestic deposits and $6.7 billion in non-resident alien deposits on Brickell Avenue, and nearly $7 billion in foreign money sits on the balance sheet in greater Miami banks. Miami is the second most popular banking hub in the United States after New York City. Currently home to over 60 international banks and nearly 100 alternative investment companies, Miami’s thriving financial district is attracting financial institutions from around the world.

 Even the financial tycoons who aren’t bringing their actual business to Miami are bringing their money here in a major way – through large real estate purchases. Goldman Sachs CEO Lloyd Blankfein and Apollo Global Management’s Leon Blac have both reportedly purchased eight (8) figure residence in Miami Beach.

Not only is Miami an international hub for condominiums, but Miami vacancy rate for rentals is currently the third lowest in the nation.

Miami is not the only city in the State of Florida that is growing. The State of Florida, depending on which demographic study you want to believe, will grow faster in raw population than any other state in the Union in the next twenty-five (25) years. In 1914, Florida was the 33rd most populated state in the United States. In 1914, New York, Texas and California were the top three (3). In 1967, the year I moved to Miami, Florida was the 15th most populated state in the country with New York, California and Texas as the top three (3) most populated states. In 2006, Florida was the 4th most populated state in the nation with California, Texas and New York, in that order, as the three (3) most populated. In 2015, Florida has become the 3rd most populated state in the country, with California and Texas as #1 and #2. Florida replaced New York as the 3rd most populated state. This trend will continue unabated for the next twenty-five (25) years at least. Some are projecting, on the low side, that in 2040 Florida will have a population of 26 million, but there are other projections stating that Florida will double its population in the next twenty-five (25) years and that Florida will have a population of close to 40 million people. I predict that 40 million will be closer than 26 million to the actual population of Florida in 2040.

As far as I am concerned, Miami-Dade County is as close to paradise as one could get. Forbes Magazine named Miami “America’s cleanest city” because of its year round air quality, vast green spaces and clean drinking water. This makes Miami an extremely attractive city to live in. The tropical climate is inviting for all types of outdoor lifestyle activities and events, as we all know.

Miami-Dade County is the principal economic engine that drives the economy of Florida. There are many other beautiful cities and areas in Florida that enjoy a very brisk economy and a wonderful way of life for those living in those areas. Without question, Florida is the most desirable state in the country and for that reason, we will grow more in raw population than any other state in the Union in the next twenty-five (25) years.


WHERE YOU LIVE MAKES A DIFFERENCE… you may have heard on the news about a Southern California man who was put under 72-hour psychiatric observation when it was found he owned 100 guns and allegedly had 100,000 rounds of ammunition stored in his home. The house also had a secret escape tunnel.

By California standards, someone owning 100,000 rounds was considered mentally unstable. Not so in other areas around the country. Please note:

  1. In Michigan, he would be called a Detroit resident who owns a pharmacy.
  2. In Arizona, he would be called an avid gun collector.
  3. In Arkansas, he would be called a novice gun collector.
  4. In Utah, he would be called modestly well prepared, but they would probably reserve judgment until they made sure that he had a corresponding quantity of stored food.
  5. In Kansas, he would be a guy down the road you would want for a friend.
  6. In Montana, he would be called the neighborhood “go-to-guy”.
  7. In Idaho, he would be called a likely gubernatorial candidate.
  8. In Georgia, North Carolina, Virginia, West Virginia, Louisiana, Mississippi, Alabama, Missouri, Wisconsin and Kentucky, he would just be a deer hunting buddy.
  9. In Texas, he would just be “bubba” who is running a little low on ammo.


BEING POLITICALLY CORRECT… has been essential in the last forty (40) years if you were to be taken seriously as a candidate to any national office. Thanks to the current Republican front runner, Donald Trump, being politically correct does not seem to be that important during this presidential election cycle. As a matter a fact, you could well accuse many of our past iconic leaders of having no sensitivity in that regard. Please note four (4) telegrams between then President, Harry Truman and General Douglas MacArthur on the day before the actual signing of the World War II surrender agreement with the Japanese in September of 1945. The contents of these four (4) telegrams are exactly as received at the end of the war, not a word has been added or deleted!

  1. Tokyo, Japan

       0800-September 1, 1945

      To: President Harry S Truman

      From: Genera D A MacArthur

      Tomorrow we meet with those yellow-bellied bastards and sign    
      the Surrender Documents, any last minute instructions?

2.  Washington, D.C.

      1300-September 1, 1945

      To: D.A. MacArthur

      From: H S Truman

      Congratulations, job well done, but you must tone down your       
      obvious dislike of the Japanese when discussing the terms of the
      surrender with the press, because some of your remarks are
      fundamentally not politically correct!

3.  Tokyo, Japan

      1630-September 1, 1945

      To: H S Truman

      From: D A MacArthur and C H Nimitz

      Wilco Sir, but both Chester and I are somewhat confused, exactly
      what does the term politically correct mean?

4.  Washington, D.C.

      2120-September 1, 1945

      To: D A MacArthur/C H Nimitz

      From: H S Truman

      Political Correctness is a doctrine, recently fostered by a
      delusional, illogical minority and promoted by a sick mainstream
      media, which holds forth the proposition that it is entirely
      possible to pick up a piece of shit by the clean end!



  1. For the first time since 2009, the NFL, in September, went an entire calendar month without any of its players being arrested. The most recent arrest came on August 26, 2015.
  2. Over the past couple of months, the most asked questions about 2016 Presidential candidates on Google were from people who wanted to know Hillary Clinton’s age, Jeb Bush’s height and Donald Trump’s net worth.
  3. Of the 21 countries that use the Euro as their currency, almost half have seen their economy shrink in inflation – adjusted terms, since 2007. By contrast, not one of the “floater” countries – European nations that didn’t adopt the Euro – has had its economy shrink over the same period.
  4. At $275 billion, Facebook’s market value is now slightly higher than General Electric’s $273 billion. Facebook is still dwarfed by the 123 year old industrial titan in other ways, however. GE reported $149 billion in sales last year to Facebook’s $12.5 billion and GE employed 300,000 people to Facebook’s 9,200. Financially GE dwarfs Facebook yet, in market value, Facebook is slightly more valuable than General Electric. The reason: stock prices are determined by financial value X emotional value. No one particularly loves GE, but hundreds of millions of people around the world love Facebook. It is that love, not Facebook’s sales or profits, that has created the $275 billion market value.


“CAPACITY” IS THE SINGLE MOST IMPORTANT WORD IN TODAY’S SURETY MARKET. Based upon the tremendous construction economy we have in Florida, the greatest challenges that relates to your surety credit may be one of aggregate capacity. At Nielson, Hoover & Company, we pride ourselves in being the largest surety broker in the Southeast United States and for very good reason. Our ability to deal with the surety capacity needs of our clients has been a key factor in our size and growth. We deal with and write with more surety markets than any other surety broker in the Southeast United States. We write business with over 64 different surety markets. This allows us to find that surety market that will address the needs of each client we have the opportunity to work with.

 If you are finding any resistance in obtaining the aggregate surety credit that your company needs, please do not hesitate to call any one of our offices. Nielson, Hoover & Company is a surety broker and a surety broker only. We do not write insurance, we do not deliver pizza, we only write bonds and we do it better than anyone else.


MY ADVICE IS WORTH WHAT YOU ARE PAYING FOR IT… but if you do not have flood insurance, you are at risk no matter where you are living. Many South Carolina homeowners who suffered flooding after devastating storms are in for an unpleasant surprise as the waters recede. Much of the residential damage caused by Hurricane Joaquin is most likely not going to be covered by insurance. Only 14% of Americans are insured against flooding. Flood insurance is written almost exclusively by the National Flood Insurance Program. The average premium is approximately $700.00 per year, but many homeowners in lower risk areas balk at the added cost, even though more than 20% of flood claims come from people outside of high risk areas. While most disasters are covered under the standard homeowner’s policy, flooding is not.

The terrible rainstorms in South Carolina serves as a solid reminder to make sure you are properly covered. In addition, the recent rains in Southern California have also had a devastating effect on many homeowners there. If your home can be destroyed in drought stricken Southern California by floods, it can be destroyed anyplace. Nearly all flood policies require a 30-day waiting period before becoming effective. Federal flood insurance covers up to $250,000 of your home and up to $100,000 for personal possessions. This is not a pitch for additional business, Nielson, Hoover & Company does not sell flood insurance. Just a word to the wise. If you don’t have it, the approximate $700.00 a year you will spend may be the best investment you can make.



“Any man who thinks he can be happy and prosperous by letting the government take care of him had better take a much closer look at the American Indian.” – Henry Ford

Charles J. Nielson