diff --git a/lib/jobManager.js b/lib/jobManager.js
index 55dbfff..d0d7233 100644
--- a/lib/jobManager.js
+++ b/lib/jobManager.js
@@ -179,6 +179,7 @@ var JobManager = module.exports = function JobManager(options){
         var blockHash;
         var blockHex;
 
+
         if (job.target.ge(headerBigNum)){
             blockHex = job.serializeBlock(headerBuffer, coinbaseBuffer).toString('hex');
             blockHash = util.reverseBuffer(util.doublesha(headerBuffer)).toString('hex');
diff --git a/lib/pool.js b/lib/pool.js
index b51ffa4..fb2a786 100644
--- a/lib/pool.js
+++ b/lib/pool.js
@@ -34,13 +34,20 @@ var pool = module.exports = function pool(options, authorizeFn){
     var emitErrorLog   = function(key, text) { _this.emit('log', 'error'  , key, text); };
 
     (function Init(){
-        SetupJobManager();
-        SetupVarDiff();
-        SetupDaemonInterface();
+        //timeout used so onLog event can be hooked before we start initializing
+        setTimeout(function(){
+            SetupJobManager();
+            SetupVarDiff();
+            SetupDaemonInterface();
+        }, 10);
     })();
 
 
     function SetupVarDiff(){
+        if (!options.varDiff.enabled){
+            emitLog('system', 'VarDiff has been disabled');
+            return;
+        }
         _this.varDiff = new varDiff(options.varDiff, options.difficulty);
         _this.varDiff.on('difficultyRequest', function(){
             emitLog('varDiff', 'Difficulty requested for vardiff');
@@ -50,8 +57,10 @@ var pool = module.exports = function pool(options, authorizeFn){
             client.sendDifficulty(newDiff);
             client.sendMiningJob(_this.jobManager.currentJob.getJobParams());
         });
+        emitLog("system", "VarDiff enabled and setup");
     }
 
+
     function RequestDifficulty(callback){
         _this.daemon.cmd('getdifficulty',
             [],
@@ -59,7 +68,8 @@ var pool = module.exports = function pool(options, authorizeFn){
                 if (error) {
                     emitErrorLog('getdifficulty', 'Error requesting difficulty from daemon for vardiff');
                 } else {
-                    _this.varDiff.setNetworkDifficulty(result);
+                    if (options.varDiff.enabled)
+                        _this.varDiff.setNetworkDifficulty(result);
                     callback(error, result);
                 }
             }
@@ -138,7 +148,7 @@ var pool = module.exports = function pool(options, authorizeFn){
         _this.daemon = new daemon.interface(options.daemon);
         _this.daemon.on('online', function(){
             async.parallel({
-                difficulty: RequestDifficulty,
+                networkDifficulty: RequestDifficulty,
                 addressInfo: function(callback){
                     _this.daemon.cmd('validateaddress',
                         [options.address],
@@ -180,6 +190,16 @@ var pool = module.exports = function pool(options, authorizeFn){
                     util.script_to_address(results.addressInfo.address) :
                     util.script_to_pubkey(results.addressInfo.pubkey);
 
+                if (options.difficulty > results.networkDifficulty && options.difficulty > 16){
+                    var newDiff = results.networkDifficulty > 16 ? results.networkDifficulty : 16;
+                    emitWarningLog('system', 'pool difficulty was set higher than network difficulty');
+                    emitWarningLog('system', 'lowering pool diff from ' + options.difficulty + ' to ' + newDiff);
+
+                    options.difficulty = newDiff
+
+                    if (options.varDiff.enabled)
+                        _this.varDiff.setPoolDifficulty(options.difficulty);
+                }
 
                 GetBlockTemplate(function(error, result){
                     if (error)
@@ -210,7 +230,8 @@ var pool = module.exports = function pool(options, authorizeFn){
             _this.emit('started');
         }).on('client.connected', function(client){
 
-            _this.varDiff.manageClient(client);
+            if (options.varDiff.enabled)
+                _this.varDiff.manageClient(client);
 
             client.on('subscription', function(params, resultCallback){
 
@@ -268,7 +289,7 @@ var pool = module.exports = function pool(options, authorizeFn){
             });
             
         }, pollingInterval);
-        emitLog('system', 'Block polling setup for every ' + pollingInterval + ' milliseconds');
+        emitLog('system', 'Block polling every ' + pollingInterval + ' milliseconds');
     }
 
     function GetBlockTemplate(callback){
diff --git a/lib/varDiff.js b/lib/varDiff.js
index 92ab1cf..2c3e51d 100644
--- a/lib/varDiff.js
+++ b/lib/varDiff.js
@@ -27,10 +27,8 @@ function RingBuffer(maxSize){
         }
     };
     this.avg = function(){
-        var total = data.reduce(function(a, b){
-            return a + b;
-        });
-        return total / (isFull ? maxSize : cursor);
+        var sum = data.reduce(function(a, b){ return a + b });
+        return sum / (isFull ? maxSize : cursor);
     };
     this.size = function(){
         return isFull ? maxSize : cursor;
@@ -47,14 +45,6 @@ var varDiff = module.exports = function varDiff(options, poolDifficulty){
 
     var _this = this;
 
-    this.setNetworkDifficulty = function(diff){
-        networkDifficulty = diff;
-    };
-
-    if (!options.enabled){
-        return;
-    }
-
     var networkDifficulty;
     var bufferSize = options.retargetTime / options.targetTime * 4;
     var variance = options.targetTime * (options.variancePercent / 100);
@@ -62,11 +52,19 @@ var varDiff = module.exports = function varDiff(options, poolDifficulty){
     var tMax = options.targetTime + variance;
 
 
-
     setInterval(function(){
         _this.emit('difficultyRequest');
     }, options.daemonDiffUpdateFrequency * 1000);
 
+
+    this.setNetworkDifficulty = function(diff){
+        networkDifficulty = diff;
+    };
+    this.setPoolDifficulty = function(diff){
+        poolDifficulty = diff;
+    };
+
+
     this.manageClient = function(client){
         var lastTs;
         var lastRtc;
@@ -80,7 +78,7 @@ var varDiff = module.exports = function varDiff(options, poolDifficulty){
                 lastRtc = ts - options.retargetTime / 2;
                 lastTs = ts;
                 timeBuffer = new RingBuffer(bufferSize);
-                console.log('first time share vardiff');
+                //console.log('first time share vardiff');
                 return;
             }
 
@@ -88,7 +86,7 @@ var varDiff = module.exports = function varDiff(options, poolDifficulty){
             lastTs = ts;
 
             if ((ts - lastRtc) < options.retargetTime && timeBuffer.size() > 0){
-                console.log('do not retarget');
+                //console.log('do not retarget');
                 return;
             }
 
@@ -101,10 +99,14 @@ var varDiff = module.exports = function varDiff(options, poolDifficulty){
             var ddiff = (client.difficulty * (options.targetTime / avg)) - client.difficulty;
 
             if (avg > tMax && client.difficulty > options.minDifficulty){
-                if (ddiff > -1)
+
+                if (ddiff > -1){
                     ddiff = -1;
+                }
                 if (ddiff + client.difficulty < poolDifficulty)
                     ddiff = options.minDifficulty - client.difficulty;
+
+                //console.log('decreasing difficulty, ddiff: ' + ddiff);
             }
             else if (avg < tMin){
                 if (ddiff < 1)
@@ -112,16 +114,18 @@ var varDiff = module.exports = function varDiff(options, poolDifficulty){
                 var diffMax = networkDifficulty < options.maxDifficulty ? networkDifficulty : options.maxDifficulty;
                 if (ddiff + client.difficulty > diffMax)
                     ddiff = diffMax - client.difficulty;
+
+                //console.log('increasing difficulty, ddiff: ' + ddiff);
             }
             else{
-                console.log('hashrate in range ' + JSON.stringify({ddiff: ddiff, avg: avg}) );
+                //console.log('hashrate in range ' + JSON.stringify({ddiff: ddiff, avg: avg}) );
                 return;
             }
 
             var newDiff = client.difficulty * ddiff;
             timeBuffer.clear();
 
-            console.log('sending new difficutly ' + newDiff);
+            //console.log('sending new difficutly ' + newDiff);
 
             _this.emit('newDifficulty', client, newDiff);
         });
diff --git a/package.json b/package.json
index 7bb3866..7810b80 100644
--- a/package.json
+++ b/package.json
@@ -1,6 +1,6 @@
 {
     "name": "stratum-pool",
-    "version": "0.0.2",
+    "version": "0.0.3",
     "author": "Matthew Little",
     "description": "High performance Stratum poolserver in Node.js",
     "contributors": [