Think Differently

PressingPausers have proven to have little interest in personal finance. Correction. PressingPausers have proven to have little interest in my thoughts on personal finance. Big dif. So why do I persist? Idk.

Just like getting dressed in the morning while on sabbatical, the fact that NO ONE will read this is liberating. Whatever shorts and t-shirt I left splayed on the floor last night are good, not many peeps are going to see me anyways as I write a blog post NO ONE will read. If a blog post falls in the woods. . .

Classic investing advice is to keep investing expenses to a bare minimum; determine what balance of stock, bonds, and cash will enable you to sleep well at night; and keep trading to a bare minimum.

In the US, investors currently have 56% of their assets invested in stocks or more than 10 percentage points higher than its historical average of 45.3%. At the top of the bull market in 2007, it stood at 56.8%. This has a lot of analysts worried that a correction is coming.

Another investing maxim of increasing popularity is to stop trying to outsmart the market. Instead, as Kendrick Lamar advises, “Be humble!” His next vid will prolly be about investing in passive index funds like this. The chorus. . .”Be passive!”

Another oft-repeated investing maxim is never invest more than 5% of your net worth in any individual stock because they’re far too volatile. A mutual fund or exchange traded fund is a basket of hundreds or thousands of individual stocks that go up and down at different times, thus creating a smoother, steadier, long term increase in value.

But damn is AAPL en fuego. Check this missive from a Vanguard forum of knowledgeable investors I’ve taken to reading recently. Wait a minute. That last sentence presumed you’re reading this, which you’re not, so note to self—revise that. This missive from a Vanguard forum of knowledgeable investors has me thinking about chucking conventional investing wisdom and improvising like #3.

“Hi—
Long time lurker first time poster. Thank you to all who have contributed to my education here, absolutely invaluable.
I’m writing about my mother and father in law’s finances, which I am slowly taking over at their request.
FINANCIAL PICTURE
Savings
$425k in various super low interest checking / savings accounts
Investments at Fidelity (unlikely to change brokerages):
Rollover IRA: $675k of which
* 86.8% AAPL he’s a lifelong Apple fanboy, bought $11,500 worth way back when, which is now $575k.”

Hindsight is 20-20, but if I was my daughters age again, for every $2 dollars of savings I could set aside, I’d put $1 in a super safe certificate of deposit and the other in AAPL. And then rebalance annually and pay 15 or 20% on the capital gains. As the aforementioned anecdote intimates, I would’ve done really, really well adhering to this “barbell” plan.

But this way of thinking suggests I’m suffering from an advanced case of “optimism bias” which causes a person to believe that they are at a lesser risk of experiencing a negative event compared to others. Note to self—AAPL can’t continue its recent run. VTI is a much safer, wiser, long-term instrument for building wealth. VTI is also long overdue for a serious correction, or to use the fancy pants mathematical phrase, a regression towards the mean. It’s as certain as the Mariner’s August playoff fade.

Sometime soon, the half of the barbell holding certificates of deposit earning 3-4% is going to bring great comfort.

 

 

 

 

 

Make Cars Great Again

By weakening fuel efficiency rules. Thank you Trump Administration for correcting the errors of the Obama Administration and helping keep cars affordable. And safer. All while continuing to protect the environment. And thank you for soliciting “all interested parties to weigh in with their views”. Very cool. Very democratic.

My view is totally sympatico with yours. Put me down for a “yes” vote on the weaker rules. Goals should be achievable, and you’re right, electric vehicles are for losers. In particular, this really resonated with me:

“Some data conclude that nearly half of consumers who purchase an electric car do not buy another because of challenges with range and recharge times.”

When it comes to things like your Environmental Protection Agency’s track record and your courageous questioning of climate change science, your administration has earned my trust so the phrase “some data” is good enough for me!

And I also agree that subsidies for electric vehicles are for losers best left to European and Chinese businesses who will never truly grasp capitalism’s allure. Please know my free-market invisible hands are clapping for your commitment to Big Oil having a more level economic playing field.

“. . . keeping in place the standards finalized in 2012 would add $2,340 to the cost of owning a new car and impose more than $500 billion in societal costs on the U.S. economy over the next 50 years.”

Again, thank you, $2,340, is not chump or even trump change. About $200 a year over 12 years of car ownership is a hell of a lot to ask for things as boring as markedly improved gas mileage and slowing climate change. Wouldn’t the typical electric car owner save more than $200 in gas costs? Sorry, strike that from the record. I’m sure there’s some more sophisticated math you have used that I probably would not understand. If you say it doesn’t “pencil out”, then it doesn’t pencil out. And “$500 billion in societal costs over the next 50 years?! No way can I do that math, but again I trust you that the “societal costs” are super scary things like more liberals feeling emboldened about spotted owls, more illegal immigrants invading our country, and more Democrats invading Congress.

“Due to these increased costs, Americans are holding on to their older, less-safe vehicles longer and buying older-model vehicles. The average vehicle on the road today is 12 years old, and data from the National Highway Traffic Safety Administration shows passengers are likelier to be killed in older vehicles than newer ones. In each of the past two years, more than 37,000 lives were lost on our roads. A key goal of this rulemaking is to reduce the barriers to enabling Americans to purchase newer, safer, cleaner cars.”

Initially, upon hearing that your Administration wanted to weaken fuel efficiency standards, I wondered why. I thought if America’s engineers were even a little great, the Obama goals were appropriately aspirational. I apologize that a part of me even wondered if you might be currying favor with Big Oil and Big Automakers, but upon just a little additional thought, that struck me as entirely too swampy a thing for your team.

I’m embarrassed that I pre-judged you. Of course, your first and foremost concern is our safety. All of your improvements to our infrastructure point to that. My cynicism got the best of me. I will do better going forward in my more affordable, safer, cleaner car.

Lastly, your editorial didn’t really touch on the “continuing to protect the environment” from the intro, but that’s okay. I understand word limits and trust you to be good for that. Again, to be clear, I am down with your downgrading of our fuel efficiency standards. And I look forward to your administration’s additional bar lowering pronouncements in the near future.

Friday Assorted Links

1. Did you like The Brady Bunch? Do you have $1.885 million?

2. Attention drivers. Highway 1 is now open.

“After 17 months and more than $100 million replacing a damaged bridge and rebuilding the highway in two locations, drivers can once again skirt the western edge of the continent, forever burnished by wind, rain, waves and tide.”

Props to the much maligned public sector.

3. No PressingPauser would ever stereotype professional basketball players just because of their outward appearance, but just in case, there’s this.

4. If I ever suffer temporary insanity and pay $250 for a pair of running shoes, they damn well better make me (a lot) faster.

“Compared with typical training shoes, the Vaporflys are believed to wear out quickly: Some runners have said they lose their effectiveness after 100 miles or so.”

$2.50 per mile? As Millennials like to say, hahahahaha.

5. Forget a Fast Car, Creativity is the New Midlife Cure. Right on. I hope that means superficial, materialistic lowlifes like me can score a pre-owned Porsche for less.

6. Could not have happened to a nicer guy.

The Truth About the Ultra Rich

They’re very different one from another. Too often, people paint them with a broad brush.

The Buffets, Gates, Bloombergs, Allens are intent on contributing to the common good. Big time. In the case of the Gates Foundation, they seek to enhance global healthcare and reduce extreme poverty, and in America, to expand educational opportunities and access to information technology.

Then there’s the oil billionaires Charles G. and David H. Koch. Read what motivates them, in “How the Koch Brothers Are Killing Public Transit Projects Around the Country“.

“The Kochs’ opposition to transit spending stems from their longstanding free-market, libertarian philosophy. It also dovetails with their financial interests, which benefit from automobiles and highways.

One of the mainstay companies of Koch Industries, the Kochs’ conglomerate, is a major producer of gasoline and asphalt, and also makes seatbelts, tires and other automotive parts. Even as Americans for Prosperity opposes public investment in transit, it supports spending tax money on highways and roads.

‘Stopping higher taxes is their rallying cry,’ said Ashley Robbins, a researcher at Virginia Tech who follows transportation funding. ‘But at the end of the day, fuel consumption helps them.'”

The Koch brothers oppose whatever slows their fortune from growing ever larger. Things like low income people gaining mobility and conserving natural resources.

David Koch’s networth is between $50 and $60 billion. How much is enough? Based on his actions, no amount.

Twice The Fun, Half the Money

Two words. University housing. Few travelers know that most universities have housing options for any visitors looking to save serious money on nearby hotels. Many times the options range from inexpensive minimalist dorm rooms with shared bathrooms to modestly priced hotel-like rooms with private bathrooms.

The Good Wife and I just spent three days living in a small, but very clean and comfortable hotel-like room on the campus of The University of British Columbia in Vancouver. The centrally located hotel is normally filled with conference participants, job candidates, and visiting faculty. The first night we watched our President pal around with the world’s worst dictator on a 42″ plasma t.v. and throughout our stay we luxuriated in the large commercial kitchen that came complete with a giant fridge/freezer; precise tubs and instructions for labeling our food; free fruit, tea, and coffee; newspapers; and an expresso maker complete with two types of beans waiting to be grinded.

And don’t forget U.S. readers, everything north of the border is currently 24% off, so our three nights cost $302. See how far that will get you in downtown Vancouver.

It gets better. Large university campuses like UBC, go Thunderbirds, have tons to recommend them, especially in the summer, when there’s a tiny fraction of the normal number of people. On our first campus walk, we met a man who befriended us and told us we had to visit the Rose Garden because “the roses knew you were coming, so they’re blooming” and also the Museum of Anthropology which has the world’s largest collection of Pacific Northwest indigenous art.

We dug the roses and the MOA, but the cheap vegetarian restaurants on campus rocked too. And the running was great, the trail that looped the campus, the tartan track, the coastline trail. Next time we’ll take our bicycles because West Vancouver’s ubiquitous bike lanes we’re calling us.

Best of all though was the swimming. After arriving, we learned a new state of the art aquatic center had recently opened in the middle of campus. BEST pool ever. Tons of natural light, beautiful materials, white, clean, spacious—the hot tub is designed for 34. I thought I had died and gone to heaven. Entrance to heaven, $5. Bring a quarter or a loonie for a small or large locker and your own towel, shampoo, and soap.

The pool was set up for long course. I could’ve swam, hot tubbed, and steam roomed all day. The only mistake I made was diving off the 3 meter board. Trying to impress the Gal Pal was not worth tweaking my shoulder.

Speaking of swimming, the nearby 137 meter long Kitsilano pool, or Kits pool if you’re cool, was what inspired our trip to West Vancouver. We were mesmerized by the pictures. Not sure it was real, we knew we had to experience it ourselves. It’s described as the third sexiest pool in the world, but that was before The Good Wife graced it with her presence. It was hard to get her out of the water. We had perfect timing too, decent weather, a week after $3.3m in improvements, but a week or two before the summer surge.

And if you’re fortunate enough to visit Vancouver, don’t miss the Granville Island Public Market for some nice art and excellent food. Speaking of food, the first night we ate at Lido, one of the Richmond restaurants featured in the previously highlighted NYT article. We we’re the only non-Asians for as far as the eye could see, super cool. The bok choy, green beans, chicken, and white super sticky rice were off the charts. Heads up—they only take cash and get Canadian money in advance because they don’t want to be bothered with silly currency adjustments.

The best part of this trip, besides reconnecting with my best friend, was mixing with locals the whole time. Downtown we would’ve been two of thousands of tourists. On campus, in coffee houses, at Kits Beach, everywhere we went, we were surrounded by ordinary Canadians, largely Chinese-Canadians, living their daily lives. As travelers, that’s how we’ve always rolled.

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UBC’s New Aquatic Center

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Kits Pool

 

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Now The Sexiest Pool En Todo El Mundo

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Post coastline to downtown run and leisurely swim with far fewer flip turns than normal.

Saturday Assorted Links

1. Where you live has a bigger impact on happiness and health than you might imagine. Unhappy? Maybe you should move.

2. The Most Ruthlessly Effective Move in Sports. Man, did I dominate kickball at Zachary Taylor Elementary School in Louisville, KY! A legend in my own mind. And another thing, you have to love Slate.com. Imagine, in this day and age, pitching this, “I’d like to do a piece on bunting in kickball” and then having it green-lighted. “By all means,” the editor responds, “this is a story that needs to be told.”

3. Dog ‘adopts’ nine orphaned ducks at Essex Castle. This link will be clicked more than all the others combined because who can resist doggies and duckies alone, let alone together?

4. The Men Who Terrorize Rio. Maybe our Second Amendment zealots who are down with citizen militias should vacation in Rio’s militia controlled neighborhoods this summer.

5. A Day in The Life of my Supposedly Frugal Stomach. An engineer tries to perfect his diet on the cheap.