When we were first introduced to argumentative writing in school, it didn't take me too long to discover that I had a flair for it. Introduction, point-substantiation, rebuttal, conclusion - I lived and breathed it all.
Back then I had a penchant for uninterrupted smooth-flowing prose - long sentences designed to display an extensive vocabulary, occasionally interrupted by a dash of punctuation melding into the next.
Over the years, this has subtly changed. Elegant as it is, that style detracts from the purpose of the essay: to clearly communicate your points as forcefully as possible.
Greg Mankiw was my inspiration here, especially his guide on How To Write Well. His posts are but a few paragraphs, but each carefully crafted word carries tremendous weight.
Now I continually distill my thoughts before committing them, often over multiple iterations. It's become a game of sorts - to express a point using a minimum of words, while still remaining comprehensible.
Occasionally I turn the game on its head, filtering my audience by providing just enough information that only the nuanced will understand. Language is fun that way.
I'm surprised by how many multi-page essays bloggers still churn out these days. (To be fair, I was guilty once.) No one has time for that.
But the antithesis of Mankiw's writing is what I call Faux Zen: style without substance.
It's amazing how much one can write without actually saying anything. Sure, there's a ton of emotive imagery embedded in the narrative, but to what end? Most of it is just literary masturbation. No one really gives a shit about how the sun is a golden apron pushing between your thighs.
There are no arguments proferred, no evidence presented, just a single continuous narrative that drones on and on.
And that is the crux of it all - by choosing to highlight a personal perspective, the narrative conveniently avoids an informed analysis of the whole. Selected facts are offered to the reader in a vague appeal to emotion. The verbosity of the piece disorients and confuses readers, leaving them vulnerable.
The veil of emotion is so heavy precisely because there is nothing under it. Faux zen.
Saturday, December 14, 2013
Wednesday, December 11, 2013
GM Holden's Australian Closure
Toyota will be next in 2014. At the margin every dollar matters.
Original article at: http://catallaxyfiles.com/2013/12/12/gm-holdens-australian-closure/
By Alan Moran
The soap opera of General Motor’s departure from Australia is ending. The company has been operating with sporadic profitability for a decade and more.
Last year it lost $153 million. This was in spite of it benefiting from the 5 per cent tariff protection on domestic sales and $73 million in government grants, although half of that was for the commercially fruitless pursuit of the green car political ideology.
In recent years, Holden’s products and quality have shown vast improvements from the models sold 15 years ago.
Locally assembled cars have been losing Australian market share. But this is to be expected in a global business that operates an internal market where each area sources models from the most appropriate location. That spells specialisation of products, more imports and more exports.
Holden’s export strength is in the “muscle cars” which have received considerable critical acclaim in the United States. But even then, they were forced to sell at very low profit margins to keep competitive. And US sales, having risen to 30,000 a year prior to the 2008 global financial crisis, have fallen 90 per cent.
Holden Australia has found itself in the wrong market segment with a product whose labour costs and government impositions make it more expensive to build than GM cars in other locations.
It’s the same story with engines. Holden’s V6 line is losing favour and its output is falling below the long-planned 100,000 level. Even within the GM family, the Australian V6 is losing out to similar engines made elsewhere.
Holden’s cost problems are well-known. They do not stem from the company being undercut by cheap third world labour. Even those plants in Europe, Japan and North America, where living standards are similar to ours, operate more productively. Very little of this is due to greater economies of scale overseas.
Holden has become little more than an enterprise run by unions for the benefit of workers and union officials, with lavish employment conditions bringing a crippling cost disadvantage.
One indicator of this is the starting wage for a production line worker: $23.50 an hour in Australia, compared to $14 an hour agreed by unionised plants in the US (even less for non-unionised plants). On top of this, Australian workers get shift penalties and overtime rates, and more than twice the normal weekday rate for Sunday shifts. These and other conditions are unknown in the US and make Australian labour market costs double those elsewhere.
Although labour costs in assembly only comprise 20 per cent of total costs, these are crucial and not irrelevant, as the secretary of the Australian Council of Trade Unions Dave Oliver has argued.
Oliver’s view, shared by so many on the political left, represents a profound misunderstanding of the drivers of business decisions in an interlinked world.
If wages are 20 per cent of costs and double what they might be, this wipes out profitability. Such cost-padding requires a price rise of 12 per cent. Yet the industry faces tight competitive conditions and Australia is integrated into a world market which provides no scope for such a price increase. Hence, the cost must come from profit, which it virtually eliminates.
Similarly, the carbon tax and the renewables requirement add severely to Holden’s woes.
Holden estimated the carbon tax was costing it $45 a vehicle but the total cost of carbon emission measures – including renewable requirements – on assembly and components is much greater.
Compared to its overseas competitors, these imposts might add as much as $600 to the cost of a car. This alone is 5 per cent of the ex-factory costs and halves the firm’s net profit, providing international management a clear pointer about future global capital allocations.
Holden’s Australian management acquiesced to union demands, buying short-term peace at the expense of the strategic loss of value for the company. In part, this was due to the centralised wage-fixing conditions loaded in favour of unions. Management at Holden saw the immediate loss of output from industrial unrest as too great a price to pay. Noting that costs were excessive, they hoped something would turn up, including further subsidies from governments besotted with the idea that a motor vehicle assembly industry was the key to economic well-being.
They had ample justification for thinking this. In addition to subsidies, Labor in Canberra and Adelaide financed numerous consultants’ reports that told a tale of massive employment multipliers and technology gains from motor vehicle assembly. Of course, these were all mythical. Such gains can be counted for every new job, but when the job is financed by taxation, its multiplier additions are offset. If the new job comes out of profits, the future is jeopardised.
Now we have the endgame. Unions face lower revenues from scamming the motor vehicle companies. Workers face much lower wages in alternative jobs – even if these become available.
Original article at: http://catallaxyfiles.com/2013/12/12/gm-holdens-australian-closure/
By Alan Moran
The soap opera of General Motor’s departure from Australia is ending. The company has been operating with sporadic profitability for a decade and more.
Last year it lost $153 million. This was in spite of it benefiting from the 5 per cent tariff protection on domestic sales and $73 million in government grants, although half of that was for the commercially fruitless pursuit of the green car political ideology.
In recent years, Holden’s products and quality have shown vast improvements from the models sold 15 years ago.
Locally assembled cars have been losing Australian market share. But this is to be expected in a global business that operates an internal market where each area sources models from the most appropriate location. That spells specialisation of products, more imports and more exports.
Holden’s export strength is in the “muscle cars” which have received considerable critical acclaim in the United States. But even then, they were forced to sell at very low profit margins to keep competitive. And US sales, having risen to 30,000 a year prior to the 2008 global financial crisis, have fallen 90 per cent.
Holden Australia has found itself in the wrong market segment with a product whose labour costs and government impositions make it more expensive to build than GM cars in other locations.
It’s the same story with engines. Holden’s V6 line is losing favour and its output is falling below the long-planned 100,000 level. Even within the GM family, the Australian V6 is losing out to similar engines made elsewhere.
Holden’s cost problems are well-known. They do not stem from the company being undercut by cheap third world labour. Even those plants in Europe, Japan and North America, where living standards are similar to ours, operate more productively. Very little of this is due to greater economies of scale overseas.
Holden has become little more than an enterprise run by unions for the benefit of workers and union officials, with lavish employment conditions bringing a crippling cost disadvantage.
One indicator of this is the starting wage for a production line worker: $23.50 an hour in Australia, compared to $14 an hour agreed by unionised plants in the US (even less for non-unionised plants). On top of this, Australian workers get shift penalties and overtime rates, and more than twice the normal weekday rate for Sunday shifts. These and other conditions are unknown in the US and make Australian labour market costs double those elsewhere.
Although labour costs in assembly only comprise 20 per cent of total costs, these are crucial and not irrelevant, as the secretary of the Australian Council of Trade Unions Dave Oliver has argued.
Oliver’s view, shared by so many on the political left, represents a profound misunderstanding of the drivers of business decisions in an interlinked world.
If wages are 20 per cent of costs and double what they might be, this wipes out profitability. Such cost-padding requires a price rise of 12 per cent. Yet the industry faces tight competitive conditions and Australia is integrated into a world market which provides no scope for such a price increase. Hence, the cost must come from profit, which it virtually eliminates.
Similarly, the carbon tax and the renewables requirement add severely to Holden’s woes.
Holden estimated the carbon tax was costing it $45 a vehicle but the total cost of carbon emission measures – including renewable requirements – on assembly and components is much greater.
Compared to its overseas competitors, these imposts might add as much as $600 to the cost of a car. This alone is 5 per cent of the ex-factory costs and halves the firm’s net profit, providing international management a clear pointer about future global capital allocations.
Holden’s Australian management acquiesced to union demands, buying short-term peace at the expense of the strategic loss of value for the company. In part, this was due to the centralised wage-fixing conditions loaded in favour of unions. Management at Holden saw the immediate loss of output from industrial unrest as too great a price to pay. Noting that costs were excessive, they hoped something would turn up, including further subsidies from governments besotted with the idea that a motor vehicle assembly industry was the key to economic well-being.
They had ample justification for thinking this. In addition to subsidies, Labor in Canberra and Adelaide financed numerous consultants’ reports that told a tale of massive employment multipliers and technology gains from motor vehicle assembly. Of course, these were all mythical. Such gains can be counted for every new job, but when the job is financed by taxation, its multiplier additions are offset. If the new job comes out of profits, the future is jeopardised.
Now we have the endgame. Unions face lower revenues from scamming the motor vehicle companies. Workers face much lower wages in alternative jobs – even if these become available.
Friday, December 6, 2013
ACA And Narrow Networks
http://marginalrevolution.com/marginalrevolution/2013/12/are-narrow-networks-a-bad-idea-for-health-care.html
1) A sober reminder that the ACA does nothing from a supply-side perspective. Three letters: AMA. Health insurance coverage is not access to healthcare.
2) This was pretty obvious from the start. If the law mandates that certain conditions be covered, premiums will rise. Yet a blatant price change would draw customers' ire. In comparison, reducing health network coverage is much more opaque.
In a similar vein, telcos deliberately offer a wide variety of convoluted plans to make it harder for consumers to effectively choose.
Another example - when the minimum wage rises, firms adjust by working their employees harder, or reducing benefits. There are countless ways to skin a cat - Nature simply finds a new equilibrium.
3) "The simple equation: Insurers say that limiting the size of the network allows them to steer patients to high-quality facilities and doctors".
LOL at the sheer audacity of the spin.
Back in my biker days, there was a well-known mechanic by the name of Ah Koon. Now, Ah Koon might have been an excellent mechanic - or not. But I never got the chance to properly appraise his skills, for the simple reason that once he had established a reputation in the community, he was overwhelmed by the resulting demand.
You literally had to wait 8 hours before he even started working on your bike at all. Imagine what that did for Ah Koon's service standards.
So if the ACA turns out a roaring success as its supporters hope, everything hinges on whether these "narrow networks" have "sufficient capacity" to cater for the increased indigent population.
Quite an oxymoron there. Especially since the main reason for using them is financial.
4) The poor will ALWAYS be worse off than the rich. Whether in a single-payer system like Australia where they suffer long waiting times, poor service standards and outdated facilities, or the magic pudding of the ACA with its narrow networks, they will ALWAYS be worse off.
The chequebook has somehow to balance, the sums somehow add up. Nothing will ever change that.
1) A sober reminder that the ACA does nothing from a supply-side perspective. Three letters: AMA. Health insurance coverage is not access to healthcare.
2) This was pretty obvious from the start. If the law mandates that certain conditions be covered, premiums will rise. Yet a blatant price change would draw customers' ire. In comparison, reducing health network coverage is much more opaque.
In a similar vein, telcos deliberately offer a wide variety of convoluted plans to make it harder for consumers to effectively choose.
Another example - when the minimum wage rises, firms adjust by working their employees harder, or reducing benefits. There are countless ways to skin a cat - Nature simply finds a new equilibrium.
3) "The simple equation: Insurers say that limiting the size of the network allows them to steer patients to high-quality facilities and doctors".
LOL at the sheer audacity of the spin.
Back in my biker days, there was a well-known mechanic by the name of Ah Koon. Now, Ah Koon might have been an excellent mechanic - or not. But I never got the chance to properly appraise his skills, for the simple reason that once he had established a reputation in the community, he was overwhelmed by the resulting demand.
You literally had to wait 8 hours before he even started working on your bike at all. Imagine what that did for Ah Koon's service standards.
So if the ACA turns out a roaring success as its supporters hope, everything hinges on whether these "narrow networks" have "sufficient capacity" to cater for the increased indigent population.
Quite an oxymoron there. Especially since the main reason for using them is financial.
4) The poor will ALWAYS be worse off than the rich. Whether in a single-payer system like Australia where they suffer long waiting times, poor service standards and outdated facilities, or the magic pudding of the ACA with its narrow networks, they will ALWAYS be worse off.
The chequebook has somehow to balance, the sums somehow add up. Nothing will ever change that.
The
simple equation: Insurers say that limiting the size of the network
allows them to steer patients to high-quality facilities and doctors;
participating providers, meanwhile, may agree to price cuts in exchange
for new volumes. - See more at:
http://marginalrevolution.com/#sthash.fDraaWMn.dpuf"
The
simple equation: Insurers say that limiting the size of the network
allows them to steer patients to high-quality facilities and doctors;
participating providers, meanwhile, may agree to price cuts in exchange
for new volumes. - See more at:
http://marginalrevolution.com/#sthash.fDraaWMn.dpuf
The
simple equation: Insurers say that limiting the size of the network
allows them to steer patients to high-quality facilities and doctors;
participating providers, meanwhile, may agree to price cuts in exchange
for new volumes. - See more at:
http://marginalrevolution.com/#sthash.fDraaWMn.dpuf
The
simple equation: Insurers say that limiting the size of the network
allows them to steer patients to high-quality facilities and doctors;
participating providers, meanwhile, may agree to price cuts in exchange
for new volumes. - See more at:
http://marginalrevolution.com/#sthash.fDraaWMn.dpuf
The
simple equation: Insurers say that limiting the size of the network
allows them to steer patients to high-quality facilities and doctors;
participating providers, meanwhile, may agree to price cuts in exchange
for new volumes. - See more at:
http://marginalrevolution.com/#sthash.fDraaWMn.dpuf
Exploring The X Chromosome
http://www.psychologytoday.com/articles/201109/the-incredible-expanding-adventures-the-x-chromosome
Utterly fascinating.
1) So apparently my factory worker Malaysian mum who dropped out from school in Secondary 2 was the genius in the family. Not the father who went to RI.
I have no problems believing that though. She had a very quick mind and a lot more guts.
2) It explains why monarchies have proved to be politically unstable. A capable king doesn't pass on his intelligence to his sons.
3) If the husband is smarter, a daughter would be optimal. And vice versa.
4) It isn't enough for your wife to be intelligent. You'll have to assess her parents and maternal line. Even this doesn't guarantee anything - it merely reduces the odds by a further 50% each generation you go back.
Utterly fascinating.
1) So apparently my factory worker Malaysian mum who dropped out from school in Secondary 2 was the genius in the family. Not the father who went to RI.
I have no problems believing that though. She had a very quick mind and a lot more guts.
2) It explains why monarchies have proved to be politically unstable. A capable king doesn't pass on his intelligence to his sons.
3) If the husband is smarter, a daughter would be optimal. And vice versa.
4) It isn't enough for your wife to be intelligent. You'll have to assess her parents and maternal line. Even this doesn't guarantee anything - it merely reduces the odds by a further 50% each generation you go back.
Tuesday, November 12, 2013
Nerds Are Not Socially Inadequate - They Just Don't Want To Make You Feel Dumb
Ironically enough, that suggests a certain degree of social awareness.
Original post from: http://www.blogger.com/comment.g?blogID=9430835&postID=8620459563504897631
Anonymous said...
(quote)
During conversations social clues have to be picked up on the fly while other stuff (talking, walking, ambient distractions) is going on. Nerds are bad at that. And we know it. We miss a lot of clues. No one likes to do things he's bad at, especially with people who happen to be good at it. It turns into a long, continuous reminder of one's inadequacy. This is why nerds tend to avoid social situations.
(/unquote)
This is very prescient. I'm not sure if that many introverts can actually articulate why they don't like these situations, other than the general sense of being uncomfortable. But there are other reasons as well.
I can articulate why - because most social situations feel overly contrived. Most people put on false fronts when dealing with acquaintances.
Not that I can't handle these. If need be (during interviews/negotiations etc) I can play the mummer and easily get the job done. Doesn't change that it feels meaningless and distasteful though, so I avoid such situations if possible.
I value authenticity when interacting with people, to the point that I'd rather not have friends if I couldn't be myself around them.
I think a lot of it is not so much the discomfort of engaging with groups, it's the engaging with groups of average or lower intelligence that is particularly taxing. Consider a discussion with a group of grad students versus an ordinary group of football fans. One is going to be a comfortable situation, the other isn't.
Every gifted person knows how this feels. Eventually you get tired of dumbing things down.
One reason for the discomfort in the low-IQ groups is that in many cases you hear a discussion where the rest of the group is either wrong or grasping slowly towards a truth they will never reach unaided, and even if unaided may be unable to grasp once it is explained.
A standout example that stuck: a friend once claimed that "funds spent on education cannot be wasted because they are always used".
Seriously, how would you have replied? It gets trickier when human relationships are involved.
I recall trying to explain on the Internet (yes I know!) to a fellow blogger how the Singapore Government's sale of various GLCs was not looting public assets, but rather a reinvestment of the funds into overseas growth sectors in order to create sustainable jobs for Singaporeans.
Many of his claims were blatantly wrong, yet he kept pushing them with the conviction of a zealot. He couldn't understand the simple concept that even though those companies were currently profitable, their long-term prospects were suspect.
Or what about Alex Au's ridiculous notion that HDB is bankrupt and requires a bailout? All he accomplished was to demonstrate his ignorance of real estate.
Here lies the conundrum. Alex might have been turning up the hyperbole to boost his readership. But there are people out there like our blogger who are mistaken in good faith. So is educating them worth the trouble?
You then have to decide whether to a) shut up, and contribute nothing to the discussion (boring and making one look like a loner), or b) just make chit-chat while offering little of value (intellectually dishonest), or c) give and explain the answer, and possibly get into an argument (confrontational, makes one look like an asshole).
Given the choice, I'd be an asshole every time. Reality punishes the wrong.
But I no longer bother convincing people.
After far too long, I finally realized - the Singapore blogosphere is more about signalling and peer groups than rational debate. That's why sites like TOC are as boring as the Straits Times - only from the other end of the political spectrum. You know how their articles will end before they even begin.
Singaporeans can't put up a good fight anyway. I participated partly because I enjoyed the cut and thrust of rebutting arguments. It was fun playing the devil's advocate and seeing what they could throw at me. Alex was supposedly the most prominent blogger - he gave it a shot and failed. Half of them can't even properly string a sentence together.
Far better to read sites like MR and Steve Sailer, which occasionally do throw up original, provocative ideas, in contrast to Singaporean sites which merely parrot each other.
So now I just mock them instead.
Original post from: http://www.blogger.com/comment.g?blogID=9430835&postID=8620459563504897631
Anonymous said...
(quote)
During conversations social clues have to be picked up on the fly while other stuff (talking, walking, ambient distractions) is going on. Nerds are bad at that. And we know it. We miss a lot of clues. No one likes to do things he's bad at, especially with people who happen to be good at it. It turns into a long, continuous reminder of one's inadequacy. This is why nerds tend to avoid social situations.
(/unquote)
This is very prescient. I'm not sure if that many introverts can actually articulate why they don't like these situations, other than the general sense of being uncomfortable. But there are other reasons as well.
I can articulate why - because most social situations feel overly contrived. Most people put on false fronts when dealing with acquaintances.
Not that I can't handle these. If need be (during interviews/negotiations etc) I can play the mummer and easily get the job done. Doesn't change that it feels meaningless and distasteful though, so I avoid such situations if possible.
I value authenticity when interacting with people, to the point that I'd rather not have friends if I couldn't be myself around them.
I think a lot of it is not so much the discomfort of engaging with groups, it's the engaging with groups of average or lower intelligence that is particularly taxing. Consider a discussion with a group of grad students versus an ordinary group of football fans. One is going to be a comfortable situation, the other isn't.
Every gifted person knows how this feels. Eventually you get tired of dumbing things down.
One reason for the discomfort in the low-IQ groups is that in many cases you hear a discussion where the rest of the group is either wrong or grasping slowly towards a truth they will never reach unaided, and even if unaided may be unable to grasp once it is explained.
A standout example that stuck: a friend once claimed that "funds spent on education cannot be wasted because they are always used".
Seriously, how would you have replied? It gets trickier when human relationships are involved.
I recall trying to explain on the Internet (yes I know!) to a fellow blogger how the Singapore Government's sale of various GLCs was not looting public assets, but rather a reinvestment of the funds into overseas growth sectors in order to create sustainable jobs for Singaporeans.
Many of his claims were blatantly wrong, yet he kept pushing them with the conviction of a zealot. He couldn't understand the simple concept that even though those companies were currently profitable, their long-term prospects were suspect.
Or what about Alex Au's ridiculous notion that HDB is bankrupt and requires a bailout? All he accomplished was to demonstrate his ignorance of real estate.
Here lies the conundrum. Alex might have been turning up the hyperbole to boost his readership. But there are people out there like our blogger who are mistaken in good faith. So is educating them worth the trouble?
You then have to decide whether to a) shut up, and contribute nothing to the discussion (boring and making one look like a loner), or b) just make chit-chat while offering little of value (intellectually dishonest), or c) give and explain the answer, and possibly get into an argument (confrontational, makes one look like an asshole).
Given the choice, I'd be an asshole every time. Reality punishes the wrong.
But I no longer bother convincing people.
After far too long, I finally realized - the Singapore blogosphere is more about signalling and peer groups than rational debate. That's why sites like TOC are as boring as the Straits Times - only from the other end of the political spectrum. You know how their articles will end before they even begin.
Singaporeans can't put up a good fight anyway. I participated partly because I enjoyed the cut and thrust of rebutting arguments. It was fun playing the devil's advocate and seeing what they could throw at me. Alex was supposedly the most prominent blogger - he gave it a shot and failed. Half of them can't even properly string a sentence together.
Far better to read sites like MR and Steve Sailer, which occasionally do throw up original, provocative ideas, in contrast to Singaporean sites which merely parrot each other.
So now I just mock them instead.
Monday, November 11, 2013
Average Is Over
Inspired by : http://www.blogger.com/comment.g?blogID=9430835&postID=6433970346816727800
jody said...
is there any serious discussion in the literature about whether the middle class is actually an aberration, that never existed in the past, and will not exist in the future? 50 years from now we may look back and realize it was an artifact of unique circumstances that existed for only 100 years.
I think most people take for granted the prosperity they currently enjoy.
Pain and suffering have been the mainstays of human existence for millennia. Through our efforts we have earned ourselves a brief respite, yet it's amazing how many - especially those who have known nothing else - feel entitled to this state of affairs.
It's been a mere two centuries since the onset of the Industrial Revolution. Bismarck's welfare state is but 140 years old. The United States is 237, Singapore a mere 48.
All of these are still works in progress. All of them could fail.
people better make their fortunes now, and i mean, right now, during the early 21st century currency and real estate bubbles. if you can get to 2 million or 3 million in fairly liquid assets, then you'll never have to work again, nor will your descendants, at least the first generation. your giant pile of money will be able to do all the work for you.
I realized this during my last year of college.
So while others were enjoying their 20s, I was building an asset base.
She's about 2 decades off though - it's a little late to join the party now. Gen X had the best shot at making this work.
One rule of thumb I've noticed: it takes two 'good' generations to make up for what was lost by one. This applies to nations and families both.
everybody else without a giant pile of money, and with average intelligence, will be screwed by 2020. it's back to serfdom for them, as they'll be unable to accumulate enough wealth to escape the dual trap of declining hourly wages and inflation. in many cities they will not even be able to afford to own property.
Realistically, 1 million dollars at 4% = an income of $40,000/year, in perpetuity. Net of inflation, naturally.
This is what I mean by destroying your childrens' opportunities through inaction. If you even manage to have any.
jody said...
is there any serious discussion in the literature about whether the middle class is actually an aberration, that never existed in the past, and will not exist in the future? 50 years from now we may look back and realize it was an artifact of unique circumstances that existed for only 100 years.
I think most people take for granted the prosperity they currently enjoy.
Pain and suffering have been the mainstays of human existence for millennia. Through our efforts we have earned ourselves a brief respite, yet it's amazing how many - especially those who have known nothing else - feel entitled to this state of affairs.
It's been a mere two centuries since the onset of the Industrial Revolution. Bismarck's welfare state is but 140 years old. The United States is 237, Singapore a mere 48.
All of these are still works in progress. All of them could fail.
people better make their fortunes now, and i mean, right now, during the early 21st century currency and real estate bubbles. if you can get to 2 million or 3 million in fairly liquid assets, then you'll never have to work again, nor will your descendants, at least the first generation. your giant pile of money will be able to do all the work for you.
I realized this during my last year of college.
So while others were enjoying their 20s, I was building an asset base.
She's about 2 decades off though - it's a little late to join the party now. Gen X had the best shot at making this work.
One rule of thumb I've noticed: it takes two 'good' generations to make up for what was lost by one. This applies to nations and families both.
everybody else without a giant pile of money, and with average intelligence, will be screwed by 2020. it's back to serfdom for them, as they'll be unable to accumulate enough wealth to escape the dual trap of declining hourly wages and inflation. in many cities they will not even be able to afford to own property.
Realistically, 1 million dollars at 4% = an income of $40,000/year, in perpetuity. Net of inflation, naturally.
This is what I mean by destroying your childrens' opportunities through inaction. If you even manage to have any.
Wednesday, September 11, 2013
Space
Inspired by http://spaceformeplease.blogspot.com.au/2013/09/the-big-house-dream.html
Many make the same mistake. Space is a psychological construct, not a physical attribute.
A bigger house seldom brings more space - in fact, quite the contrary. There are more rooms to clean, more furniture to buy, more maintenance issues to resolve.
She talks about escaping the rat race, yet cannot resist chaining herself to this dream of a "big house".
But is this really her dream, or one foisted on her which she does not have the self-confidence to resist?
Space is: serenity. The peace and quiet one only finds in the suburbs, away from the noise and bustle of the city. Out here, it's dark enough to stargaze on the porch. Or watch the rats scurrying between the telephone poles, sliding across the wires like trapeze artists.
Space is: watching Nature play out its dramas in our yard. We mostly get budgies, but the occasional raven calls and once even a pair of ducks. An eagle attacks a mother bird and she plunges from the sky! We discovered her in the driveway a few days later, feeding a colony of worms.
Space is: walking through the park on my way to work. The fresh air, the greenery, the feeling of being all alone. I get on the train and there's always an empty seat waiting in the corner, just for me.
Space is: not having anyone else to answer to. Independence may bring the burden of responsibility, but its fruits are yours alone. No one can fetter me here. The lack of familial obligations is such a boon. Ever had to bring your children to visit their grandparents after a long, exhausting week?
Space is: being able to choose what I want for myself. I choose to work less so to write more self-indulgent essays like this. I choose to spend more time with my family, to think about the topics which interest me, to question the assumptions which we live by.
Space is: living in a society which offers so many different paths to success. Being inspired by others to learn and grow and invest. Having the courage to both dream, and work towards those dreams.
Freedom is about living the life you want, not what others demand.
Many make the same mistake. Space is a psychological construct, not a physical attribute.
A bigger house seldom brings more space - in fact, quite the contrary. There are more rooms to clean, more furniture to buy, more maintenance issues to resolve.
She talks about escaping the rat race, yet cannot resist chaining herself to this dream of a "big house".
But is this really her dream, or one foisted on her which she does not have the self-confidence to resist?
Space is: serenity. The peace and quiet one only finds in the suburbs, away from the noise and bustle of the city. Out here, it's dark enough to stargaze on the porch. Or watch the rats scurrying between the telephone poles, sliding across the wires like trapeze artists.
Space is: watching Nature play out its dramas in our yard. We mostly get budgies, but the occasional raven calls and once even a pair of ducks. An eagle attacks a mother bird and she plunges from the sky! We discovered her in the driveway a few days later, feeding a colony of worms.
Space is: walking through the park on my way to work. The fresh air, the greenery, the feeling of being all alone. I get on the train and there's always an empty seat waiting in the corner, just for me.
Space is: not having anyone else to answer to. Independence may bring the burden of responsibility, but its fruits are yours alone. No one can fetter me here. The lack of familial obligations is such a boon. Ever had to bring your children to visit their grandparents after a long, exhausting week?
Space is: being able to choose what I want for myself. I choose to work less so to write more self-indulgent essays like this. I choose to spend more time with my family, to think about the topics which interest me, to question the assumptions which we live by.
Space is: living in a society which offers so many different paths to success. Being inspired by others to learn and grow and invest. Having the courage to both dream, and work towards those dreams.
Freedom is about living the life you want, not what others demand.
Tuesday, August 27, 2013
Sunday, August 25, 2013
Change As The Only Constant
Plenty of people in Australia who have left their homeland.
New Zealanders coming across the ditch.
Malaysians working in PNG.
South Africans after apartheid.
Argentinians fleeing hyper-inflation.
Brits after the fall of Thatcher.
Irish after their housing crisis.
The sorry stories of Spain and Greece.
And yes, Singaporeans.
Change is the only constant.
TBD.
New Zealanders coming across the ditch.
Malaysians working in PNG.
South Africans after apartheid.
Argentinians fleeing hyper-inflation.
Brits after the fall of Thatcher.
Irish after their housing crisis.
The sorry stories of Spain and Greece.
And yes, Singaporeans.
Change is the only constant.
TBD.
Monday, August 19, 2013
Inflation: How Handouts Increase Prices
TBD
1) General theory of inflation
2) Australia - childcare grants
3) Singapore - HDB grants & CPF liberalization
4) Australia - First Home Owner Grants
5) Subsidies have to be targeted.
6) Link to universal healthcare - will be fine as long as someone else pays
7) Supply side interventions better as they tackle the problem at its source. Prices will naturally decline as availability of care increases
8) Exactly what they did - doubled budget, more beds, doubled med student intake, new hospitals
1) General theory of inflation
2) Australia - childcare grants
3) Singapore - HDB grants & CPF liberalization
4) Australia - First Home Owner Grants
5) Subsidies have to be targeted.
6) Link to universal healthcare - will be fine as long as someone else pays
7) Supply side interventions better as they tackle the problem at its source. Prices will naturally decline as availability of care increases
8) Exactly what they did - doubled budget, more beds, doubled med student intake, new hospitals
Saturday, August 17, 2013
We Were All Young Once
"Looking back at those early years, I am amazed at my youthful innocence. I watched Britain at the beginning of its experiment with the welfare state; the Atlee government started to build a society that attempted to look after its citizens from cradle to grave.
I was so impressed after the introduction of the National Health Service when I went to collect my pair of new glasses from my opticians in Cambridge to be told that no payment was due. All I had to do was to sign a form.
What a civilized society, I thought to myself. The same thing happened at the dentist and the doctor."
I was so impressed after the introduction of the National Health Service when I went to collect my pair of new glasses from my opticians in Cambridge to be told that no payment was due. All I had to do was to sign a form.
What a civilized society, I thought to myself. The same thing happened at the dentist and the doctor."
- Lee Kuan Yew
The Costs Of It All
The past six years Down Under have been a complete repudiation of Keynesianism and deficit spending. In spite of a minerals boom, racking up a few hundred billion AUD in debt and a ballooning public sector (especially in healthcare and education), the Australian economy continues to suffer from record unemployment and anemic growth.
To pretty much sum things up:
1) Australians voted for Rudd because he promised them benefits.
2) To pay for the benefits he raised taxes and racked up debt.
3) In line with Ricardian equivalence, investors left and employers started firing.
4) Australians essentially screwed themselves.
A simple premise lies at the heart of all this: all Government spending is taken from someone else. Every job "created" by the public sector is a private job lost.
Keynesians claim that if the private sector lacks the confidence to hire, governments must. But the question then becomes one of whether the Government can inspire confidence amongst the private sector.
A maverick Government like Singapore's might pull this off. But few others can.
The Keynesian emphasis on "demand" is misleading. Demand is simply a proxy for confidence and credibility.
Employers understand that every dollar of this "demand" and every benefit paid will be eventually recouped from them via taxes. It's merely a matter of which industries will subsidize others, and when payment is due.
Furthermore, they are aware of the temporary nature of Government stimulus. Some may turn to rent-seeking and set up new enterprises to capture the monies being distributed. But these are inherently short-lived and unstable affairs which disappear as soon as stimulus is withdrawn.
Few will be misled into believing that a genuine recovery is underfoot. In fact, wasteful or poorly-targeted stimulus measures may be taken as a sign of incompetence, crippling investor confidence further.
So they react accordingly. They cut hours. They stop investing in Australia. And they fire staff.
Hence the sorry situation in Australia today.
The next time a politician promises to "support our schools and hospitals" and "create jobs", think of the costs. Ultimately, you will always pay.
Wednesday, August 14, 2013
Values
The meaning of life: to succeed by embodying your values, thus marking their superiority.
In order:
1. Family is everything.
2. Every argument has two sides. An educated person sees both.
3. Know where you're going. And how you're getting there.
4. Plan slowly. Act quickly.
5. Before you critique something, understand it first.
6. Logic always trumps emotion. Results always trump intentions.
7. Don't bother convincing the irrational. Just mock them when they inevitably fail.
8. The price of freedom is the possibility of failure.
9. If you want something, build it yourself.
10. Be the best you can be.
In order:
1. Family is everything.
2. Every argument has two sides. An educated person sees both.
3. Know where you're going. And how you're getting there.
4. Plan slowly. Act quickly.
5. Before you critique something, understand it first.
6. Logic always trumps emotion. Results always trump intentions.
7. Don't bother convincing the irrational. Just mock them when they inevitably fail.
8. The price of freedom is the possibility of failure.
9. If you want something, build it yourself.
10. Be the best you can be.
Two Sides
Every person
Has two sides
A Doctor Jekyll
And Mister Hyde
What am I?
Driven
Insensitive
Confident
Arrogant
Rational
Heartless
Critical
Condescending
Gifted
Elitist
Has two sides
A Doctor Jekyll
And Mister Hyde
What am I?
Driven
Insensitive
Confident
Arrogant
Rational
Heartless
Critical
Condescending
Gifted
Elitist
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