I keep hearing all this crap from the media about rising food prices.  And then they talk about the price of gas.  And then they talk about the falling home prices (which aren’t really falling, but simply returning to a more reasonable level after being inflated themselves).

But they always talk about them separately, as if they had nothing to do with each other.

They are very related…and the relation is to the value of our money, which is a fiat money issue.  It is related to ramping up the printing press, and a crisis in the faith of the value of the dollar.

Remember that fiat money has no value other than the agreement that it can be exchanged for things.  The US dollar is worthless if everyone decides we don’t want to use it for payments anymore.  At that point the govt must enforce its use, prevent by law the exchange of the dollar for something of hard value….and then the govt usually collapses some time after that.

So….what does this have to do with anything?  The recent rise in prices is caused by the devaluation of the dollar (a fiat money, printing press issue), not by any smokescreen the government or media may be reporting.

Here is the thought exercise:

The government is printing more dollars (through low interest rates), making each dollar worth less.  We see this, and the international community sees this. 

It is in everyone’s best interest to convert the value of your dollars into another store of value (gold, the Euro, real estate, etc.) that is more stable.  Every day you hold dollars, they are worth less…so you convert the dollars to something of hard value.

What do you choose?  The first option for the international community is probably another currency, because it is a quick, easy way to convert value….and we see this:  Major currencies all appreciating versus the dollar. 

But what happens when other central banks also depreciate their currency, or there is a crisis of trust in the fiat money system in general?  Easy:  We choose a hard store of value…something that doesn’t represent something of value (like a bill or coin), but actually IS valuable (like food, oil, real estate, etc.)

What is the most popular hard store of value ever???  Real Estate.  You cannot turn up the printing press on land.  Unlike paper bills, they’ll never make any more:  the supply side is fixed.  In uncertain economic times, land is a certain store of value.  And that’s what we saw:  Housing (and thus real estate) prices shot through the roof.  People liquidated their dollars (which were very cheap anyway due to low interest rates) and bought a hard asset.  We did it, and the international community did it.

So the “fall” in real estate values is not a fall so much as it is a return to more reasonable levels after a real estate bubble created by the process I described above.

Now lets look at Food prices:  Do you think there are suddenly more people eating?  Or that crops are failing all over the world?  No.  We buy most of our food from abroad, the dollar is worth less, so it takes more of them to buy food.

Now let’s look at Gas prices:  Is there a supply side issue?  Is less oil being pumped?  No.  Is there a sudden rise in demand?  Not enough to justify the current rise.   Here is the price of oil in gold instead of dollars:  our currency is plainly losing value.

Part of it is our dollar is worth less, so the price is rising.  On a related note, oil is priced in dollars as an international commodity, so the price cannot rise the same as non-dollar denominated assets.  So why the sharp rise?  Is inflation THAT bad?  I’m not exactly sure about this one…but it may be oil speculation.  The movers/shakers on the international scene are looking for safe stores of value for their money.  Currencies are being devalued (can’t invest there), real estate prices have already been run up (can’t invest there)….so what’s the next hard store of value to move to…..commodities (oil, metals, etc).  So the next bubble would be in commodities.

Is there anything we, as regular people, can do about the government devaluing our dollars?  Not really unfortunately.  For those with the determination, it is possible to denominate your savings accounts in other currencies, or gold….but I think most of us are stuck with inflation.

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Update 5/30:  Here is an interesting article that makes the point I’ve been getting at with historical examples (which I was too lazy to lookup):  Fiat currencies always fail.

Tags: economics, inflation, money

Isn’t that what they say? As if thinking you’re younger can actually make it so?

My wrist injury has made me face aging for the first time in my life. I remember years ago I said “Youth will not rust in my possession.” I was like 15 or so.

As an aside, I thought I was quoting Thoreau or Emerson, but after a Google search it turns out I made that up. I can’t find that quote anywhere. The closest I can find is William Congreve in The Way of the World….which I can’t recall if I ever read: “For my part, my Youth may wear and waste, but it shall never rust in my Possession.” The olde English writers had an odd habit of Capitalizing things that didn’t Need it.

I have also said, “You will not die with your health, you might as well use it up.” I think Mark Twain said something like that, but it isn’t a direct quote. Another Google search doesn’t find anything similar. Maybe I made that one up too?

So for the first time in my life I am faced with a life altering injury. I join the ranks of adults who complain of their ailments, restrict what they do, and wear several braces while limping from one activity to the next. That is an adult activity; no youth involved.

I liked tennis because it is one of the only active sports you see older people playing, even the retired. I gave up basketball a few years ago because it was too hard on the body. Golf also counts in that group of elderly sports, but it isn’t much exercise…and my wrist won’t let me do that anyway…and I suck even if I were healthy.

I have seen more doctors this year than every previous year of my life combined. No youth involved in that either.

This is the first problem I’ve ever had that can’t be solved.  Usually hard work, or brains, or connections, or patience, or money can find a way to solve your problem.  If you can’t solve it, your just need more of something (more money, more time, etc).  This is something that can’t be fixed.

You’re always aware there are problems that can’t be fixed.  We read about them in literature, and see them in the movies and on Dr. Phil….but rarely do they show up in our lives, always someone else’s.  And we always think, “Man, that would suck.”  Guess what:  It does.  Being confronted with unsolvable problems is an adult lesson that I would rather not learn.

I have always been enamored with the idea of perfection of self…or stated in a healthier way: self-improvement. I’ve alluded to this in other posts though, and I’ll bring it up now again: Perfection requires time, and an unchanging environment to even begin to approach. If the variables are always changing, its hard to improve significantly. You just stumble ahead the best you can trying to figure out your new paradigm.

I did pretty well perfecting youth. I was able to be young, grow, have adventures, do it my way, and bear most of the responsibilities of adulthood while maintaining a youthful outlook…..but guess what: Now I’m a 33 year old youth with all the attendant advantages and disadvantages. And I’ve taken it as far as I can.

Until now I could basically say, “I’m pretty much as good as I’ve ever been at everything I’ve ever done.”  That isn’t completely true, but its basically true.  Now I can’t say that.  Declining overall potential is an adult issue.

The injury is forcing a philosophical paradigm shift. I am no longer young, and I must deal with that.  It took me 33 years to “perfect” youth. Perhaps by the time I’m retired I will have a handle on adulthood?  Funny.

So they say you’re only as old as you feel: Well…I feel old.

So is there anything good to come of this? Not much…but here is what I can come up with.

– At least I don’t have to move furniture anymore.

– At least I used my youth while I had it. Would it have been better or worse to have an injury like mine if I didn’t play sports or get exercise anyway? For those people, it wouldn’t have been an impactful injury. They weren’t active before; they wouldn’t be active after. I can do most day to day things without pain.

– Now I can focus on my music career (haha).

Since I am a second guesser by nature, I don’t love many products. I bought a big 50′ plasma TV and noticed the clunky remote and lack of deep black color differentiation immediately. Actually the TV is incredible in HD, but it certainly did not change my TV viewing experience…it just really improved it.

The iPhone on the other hand is a behavior altering product. It is not just a better cell phone. It has changed the way I use my “hand-held communications device”…or whatever you want to call it.

I still make phone calls, and it does that well…giving you great Contact capabilities and visual voicemail on top of a beautiful touchscreen interface (which is awesome by the way). That’s all just cell phone stuff.

But when you add in Internet access, a crisp 3.5 inch screen, an iPod, and the ability to type on a pretty darn functional full QWERTY keyboard, and its really more like a hand-held computer than a cell phone.

I use the iPod feature like a regular iPod. It works better than my old one, and I don’t have to carry around two devices (phone and iPod).

I also use the Internet access to check and send email, and as a result spend less time on my home computer.  You see its competing with my computer, something a cell phone couldn’t do before.

There is the web browser. I use the Maps function to get directions…while I’m out, not using Google maps and printing it out beforehand. The screen is big enough to actually see as if you were on a regular computer….it isn’t just text. We’re sitting around after tennis and wonder what movies are playing. I can check right from my phone in like 5 seconds. I’m using it this month to track my expenses. Every time I make a purchase, I go to expenseview.com and enter the amount. I don’t bring books with me to read while I’m eating anymore. I surf the web and read NYTimes.com or whatever. And yes…the screen is that good, especially if you use the easy multi-touch zoom feature. (in the interest of full disclosure though, I do have good eye sight; if you don’t, you wouldn’t be able to use it like that.)

I use the calendar (all phones HAVE a calendar, but do you use it?). The keyboard works well enough, and then I always know what my schedule is if someone asks can I do something on X weekend. I don’t have to say, “Let me check my calendar and I’ll get back to you.”

I take pictures with the 2 megapixel camera, and they turn out pretty well. I can immediately send them to someone else by email.

So here is my iPhone wish list: a) longer batter life…I use the damn thing so much it only lasts a day or two. b) better camera…its already replaced my iPod. With a 4 or 5 megapixel camera it could replace a camera too. c) faster internet access: I use it so much the slow data speeds are really noticeable.  d) I’d like it have GPS while I’m wishing. e) I’d like to use the Bluetooth capabilities to function as a TV remote as well.

Anyway…that’s enough iPhone love for today.

FYI: I’m actually making this post FROM the iPhone.

Several political candidates are talking about some sort of universal health care. Everyone knows I am for socialized medicine. If we provide free basic education because we believe education is a right everyone has, then how can being healthy not also be a basic right? I would say health is a basic right before education even.

Few would argue the basic premise there; the issue is that it is too expensive; however, all other industrialized nations provide universal healthcare at a total cost less than what we are already spending. In essence, we’re already paying for universal health care…so why don’t we have it?

Let’s run a simple thought experiment (luckily no economists read this page) that models the health care market, and allows us to see why costs might spiral a bit…and mainly points out why more government intervention in our current health care system will raise prices, not reduce them:

Let’s say there are 3 people in the economy and they each have 1 dollar. One is sick and has to go to the hospital. How much can the hospital charge? One dollar. Nothing can cost more than a dollar, because the hospital will go out of business if it charges more (because no one can pay).

Let’s say insurance companies get into the mix and you buy a 1 dollar insurance policy, and of course you potentially get more than that in health care. Now there are two hands in the pot. Your 1 dollar and some amount from the insurer…for the sake of argument let say they are adding an extra dollar on top. How much can hospitals charge now? 2 dollars.

Let’s say the government gets in the mix, and subsidizes health care by 1 dollar. How much can the hospital charge? 3 dollars. Now we are starting to get the picture…

Every dollar added to the total pot to spend on health care expands the total dollar amount that can be charged. You can never charge more than what people can pay. Conversely, the price a market charges for a good/service will always expand to fill the total money in the pot.

Everytime the government says they will pump money into the health care market, they are raising prices because more total money is available to be spent. If there is a tax credit of 30%, in the most simplistic model, prices rise by 30%. The goverment is accomplishing the very opposite of what they’re hoping to do.

On a related note, here is the reason why the goverment may or not pander to universal health care, but nothing will really change: Too much is already invested in the current system. Thousands of jobs and billions of dollars in business revenue would disappear.

Imagine the extreme model (again simplified): Nationalized Health Care.

Nearly the entire health insurance industry (BILLIONS of dollars) could close up shop overnight. What good would private or employer-provided health insurance do if you already had it through the govt? It would be useless. All those jobs, gone. (some could get a job with the govt…but not nearly the same numbers would be needed.)

Employer provided benefits disappear. HR departments would thin out significantly…no more Benefits department. All those jobs, gone. You may think non-health care employers would be all for that, but the US is unique in that you HAVE to have a job to get health care…that sort of forces you to get a job (and keep one). I’m not so sure employers would be for it (although surely some would).

Health Care Consulting/Outsourcing would disappear overnight. I actually worked for nearly 4 years in health care outsourcing. This business is billions of dollars a year…just helping companies sort out all the laws and options, and helping adminstrate (coordination between all the health care providers, the business, payroll, employees, etc). 10,000 plus jobs…gone.

The health care providers (hospitals, doctors, etc) would see prices drop in nationalized healthcare. There might be price controls, health care would no longer be a for profit business, a single payer system (if that happened) would put a natural cap on what could be charged. Overall, health care providers have a profitable and fairly predictable business model right now….fear alone would give them a vested interest in the status quo. (unlike insurance/consulting/outsource though, at least most of these jobs would remain)

Big-pharma would lose too…they are some of the big winners (profit-wise) in the current health care system. Anything that damages their pricing structure is a threat. Drug companies would still exist in a nationalized system; however, they will complain that reduced profits means less money to research new drugs (which may be partially true).

So you see three things here: 1) The vested interest of these multi-billion dollar corporations is to continue the current system…so we’re unlikely to see a change no matter how well-intentioned (<– yeah right) the politicans are, 2) SOOO many people are employed in the health care industry who would almost instantly be put out of work……nothing is going to be done, and 3) All these thousands of people and billions of dollars in revenue is a large part of WHY your healthcare costs so much today…the more hands in the pot, the more it will cost.

Tags: economics

Since I took down the history of the website I can’t link to last year’s New Year’s post, but here are my resolutions:

“2007 is going to be the best year ever because I said so. If you do not think 2007 is going to shape up too well….then please don’t talk to me because I am only interested in having the best year ever.

I have made no resolutions this year other than that my life will be the best. I will get a new job this year, and buy a house. That means I will have to buy furniture…..but that’s OK, because the furniture will also be the best ever.”

So how did I do?  Well, predictably it wasn’t the best year ever.  That was 1995 when I went to Groningen.  BUT…the only two concrete goals I made:  1) get a new job, and 2) buy a house.  I sort of met those, just a few weeks late.

I didn’t meet them in 2007.  I close on my house on Jan 14th 2008, and the transition date for the new job that I was wanting is…let me check my email…wow:  It is also Jan 14th 2008.  I am two weeks late on both goals, but came pretty close.  Also, that is quite a coincidence.

So what are my resolutions for 2008?  People don’t keep them anyway.  Mine were a little different though since I could actually go back and read what I said. 

I can’t think of anything.  Since I just met my goals for 2007 I haven’t had time to set my sites on anything else.  I guess I could say, “Do well at my new job, and enjoy living in my own place” but in all honesty those are unmeasurable goals.  “Get a new job and buy a house”…that is concrete.

I could also make smaller goals like “write/record my own song” or “get the deck replaced on my house” or “go through the mixed doubles season without getting my serve broken”…but those aren’t really New Year type of goals.

I’m going to have to think about it, and maybe make my resolutions a few weeks late this year…after all, I was two weeks late meeting last year’s.

Anyone wishing to record their resolutions for review next year at this time, please make a comment so I can check back with you to see how you did.

Tags: Resolutions

Onion rings from Ted’s Montana Grille: Seriously…they’re great. The best I’ve had since I was a kid at some hamburger joint in Myrtle Beach I can’t remember the name of.

Pandora Radio: I don’t have a TV. I do listen some to radio (only on the internet), but mostly classical, because no stations really suit me. Well…I made my own station. You get to choose a few songs you like, and then it creates a station around your preferences. If you like a song, you can give it a thumbs up, or add artists if you find others you really like. Create as many stations as you want for different moods. Here is my first one.

Fuller’s 1845: A well balanced, smooth bottle conditioned ale. It isn’t the same as drinking it from a tap…but its pretty good. Malty, but without being too sweet, a very slight bite in the aftertaste. A great beer drinker’s beer.

Ate dinner with an old friend: Can’t beat that. Jeffrey is doing pretty well from what I can gather. I like his wife, and they both have new jobs. He got his car stolen last weekend, and insurance (since he had liability only) won’t cover it…but the car wasn’t that great anyway. It’s life. What can you do?

Went for a short jog: I suppose there is nothing that special there…but in light of the fact that I’ve been nursing a sprained ankle for the last 3 weeks, I guess its progress to be able to run a little.

….now I just need to win the lottery.

Tags: beer, good, radio

I went to my 5 year MBA school reunion this weekend in Columbia. I hadn’t seen many of them since graduating, although I knew more or less what folks were doing.

Graduate school isn’t like high school or even college. People don’t get fat. People don’t look significantly older. People don’t change much/any. They are doing largely what they said they wanted to do when we graduated.

No one was really a surprise. I guess we were all adults when we started….we were the weight we were going to be….our personalities were already largely developed…we already knew what we wanted. Some people had recently had kids….still, they were the same.

They were not any less fun than I remembered. They still drank and laughed and hadn’t become too serious. They were responsible, yet relaxed. Those who had significant others with them had picked someone who allowed them to act just as they had when they were single. No one had toned it down to please the opposite sex.

One person was a little off, but she was off even when we went to school…nothing really different.

What I really learned is that I can’t drink like I used to. I can still put them away w/o getting drunk…but I am worthless the next day. I don’t get hangovers much, and that is still true. I just get tired, and useless.

I did it up on Friday, as the business school picked up the entire group ‘s (20+ alumni) bar tab. We drank for about 6 hours. I can’t imagine how much it was. On the flip side I can imagine how much money we gave the school for the degree.  I should’ve drunk more.
I started drinking again on Saturday in the morning for the football game (like you’re supposed to)….and I ended up falling asleep in a fold-up chair watching TV. After a quick nap I was up again, and drinking….but I got tired again, and thankfully the game was over and I had to go back to the hotel to change for dinner. I took a nap (again) and was about an hour late. Everyone else was too (maybe they’re all having the same problem I am?)….so I ate a yummy dinner and had a good time talking to Victor and Maria.

Then we went to some bar next door. My steak and cheesecake were sitting heavy on my stomach, and I decided I couldn’t hack it….back to the hotel and I was asleep before my head hit the pillow. That’s pathetic.

Tags: Business School, drinking

I added a twitter widget to my sidebar.  I think the concept is interesting.  Its not enough to have email, or a blog, or telephone #, or RSS….now there is a way to feed your whole life….every mood, every action.  The next step would a webcam that streams a picture of my room to the website at all times.  Ever see that movie Ed TV?

The final step would be to steam your entire day…..actually, there is a guy that wears a webcam around his neck at all times and is basically broadcasting his whole life….like the Truman Show.  Justin.TV is designed specifically for that.

I like the blog so I can write; however, all this connectivity makes me wonder how far it can/should go.  Sometimes I wonder too whether it is altering us in some way; actually, in this case not so much altering as reflecting changes already happening.

The reported rise in Autism Spectrum Disorders makes me think.  For the past 100 or so years society has really rewarded “systemizers”.  These are people that see patterns well, are accurate (like a computer), and task focused.  On the flip side, they miss social cues, obsess on insignificant details, and are unable to form meaningful (from a normal point of view) relationships.

I know that in basically 2 or 3 generations you wouldn’t expect to see natural selection at work…but maybe it does work that fast, or at least fast enough for us to see the uptick in “systemizer” disorders.

For a systemizer, something like twitter would be a way to interact.  It could really replace human interaction based on their rules.

There are other explanations too…like 30 seconds of fame, a genuine desire to keep friends/family apprised of what you’re doing, or even “I would’ve done it before if it were technologically possible”.  I think a combination of all that is the likely explanation….there are too many people interested in micro-feeds (twitter-like apps) for them to all be systemizers.

Regadless, the term “disorder” to refer to over-systemizers is interesting…because there are a number of folks with Aspergers and other Autism spectrum disorders that are saying, “We don’t have a disorder.  We don’t need to be treated.  We’re just different from other people.”

Its true but odd.  They live fine.  They just don’t relate in a “normal” way to other people.

I could envision a future full of systemizers where all people interacted transactionally….there would be no Aspergers, or other “non-emotive” disorders…because everyone would be on board.  Those with disorders would be the “emotives”…..people who were overly sensitive or obsessed on insignificant social cues that didn’t affect the overall outcomes…people who were “dumb” (which means they were unable to see obvious patterns, and were prone to inaccuracies).

Why can’t you have both?  Why can’t you be emotive and systemize?  I suspect its a trade off brain wise.  Not everything can have the driver’s seat.  The brain is metabolically very costly (consumes 20% of our energy).  If you focus that 20% on systemizing…you’ve got a lot of resources at your disposal…however; you can’t do both, as it would require a rework of the brain circuitry to pay attention to more things and require you to consume even more energy.

I read recently the “smart” people aren’t those who are better able to remember things, but those who are better able to forget.  They have basically the same resources at their disposal (a brain with a 100 billion plus neurons) as “dumber” people, but they are better able to forget the non-significant and remember what they need to:  ie.  they focus on the important stuff.

What’s important?  Well…that depends.  If you’re a systemizer, then details and patterns are important.  If you’re an emotive, then people are important.  It depends in which direction you want to wield your metabolically costly, 100 billion neuron brain.

What about my brain?  Hehehehehe.  I am an emotive systemizer.  I do have a special talent for being right in the middle…but that does mean that I am annoying to both the systemizers and the emotives as I’m not enough of either for them to totally identify with me.

There is actually a researcher (Simon Baron-Cohen) who divides the world between systemizers and emotives (he calls them empathizers) as well.  I don’t know the guy but I bet he’s a lot like me.

So the website disappeared for…..I don’t know. A while now. And even before that I had stopped posting.

All the old posts, from 2002 to 2007….still exist of course. I don’t know if I will ever put them back up to be honest.

As for why I stopped posting, why I took the website down….I’ve answered that question personally to a few people. No one else likely cares.

Anyway, its sort of spooky to be able to go back and read part of the inside of someone’s head for 5 years. It cries out to be misinterpreted, and it usually was.

So, since I’ve put the website back up, does that mean I’m starting the whole cycle over again? Maybe, after all….I’m not always that smart. I have better controls now though. I can password protect posts or even whole parts of the website and make people sign in to read. I probably won’t do that, but its an option.

As for the “cool” (in my opinion) chasing eden format/theme…..you know, the pic, and the colors and all that:

I will slowly rebuild that…maybe. I don’t have as much time to come up with all that jazz anymore. I was unemployed when I built the last site, and the technology has changed a lot since the days of editing html in wordpad.exe.

Tags: website