Monday, October 20, 2014

Moving Blog to Wordpress?



I am experimenting with moving the blog to wordpress.   So far, it seems about the same, only clunkier.

The new blog is at:


--Bob.

Saturday, October 18, 2014

Goodbye, Google!

Untangling yourself from the evil web of Google is harder than, well, untangling yourself from Facebook.   This is not by accident, but design.


One of the (unintended) genius things about Facebook was that it turned out to be a compulsive addiction.   People got onto Facebook, and most of them have to check it daily, hourly, or even every few minutes, to see what is on their "feed".   "Feed" by the way is what they give to cows.  To fatten them up to slaughter.

Facebook, I think, stumbled into this, and has since enhanced the feature.   As I noted in my Social Networking Seasickness posting, it is hard to see exactly what is on your Facebook page, as they use an algorithm to decide what you get to see, and if you dig around you can find other postings.   But some things appear on your "feed"  and then disappear after a time, so it encourages you to constantly check Facebook (via your smart phone "app" of course!) all the time, lest you "miss something".

It really is fucking brilliant, if you think about it - it has enslaved an entire generation to their cell phones, the Internet, and one website.   And the results are pretty frightening.   "Social Media" has become the number one source of misinformation, half-truths, and outright lies, as any daily perusal of Snopes.com will attest.   People on "Social Media" talk only to like-minded people, so if one posts a fraudulent video depicting Obama giving a speech that promotes Nazism, well, they all tend to believe it.

This shit is evil beyond belief, and if I swear it is because I am mad about it.   Each generation, it seems, is enticed by the siren song of some new form of media - and herded off a cliff as a result.   When newspaper chains were formed in the late 1800's, people could be made to believe most outlandish things.  William Randolph Hearst is alleged to have said, "You furnish the pictures, I'll furnish the war" - with regard to the Spanish-American war.   The point of the alleged quote is that Hearst, owning a lion's share of the nation's newspapers, could shape public opinion as he chose - enough to get the U.S. to declare a war, if he wanted to.  And he wanted to, just to sell newspapers.

The radio generation of the 1920's followed suit by falling into line behind "the Great Dictators" of Europe, who used radio broadcasts (and newsreels) to inflict their ideology on entire nations.  Even Roosevelt used his "fireside chats" to get him elected an unprecedented four terms.  He understood the power of this new medium and how to use it.   He was no fool - he knew that he had to use radio to get into power and stay there, if nothing else, for the good of the country.

Television brought us the first televised war, Vietnam, and the media in that war was cleverly manipulated to turn public opinion against the war.   By the time of Operation Desert Storm, the Pentagon had a better handle on controlling the media, and provided nice sound-bite ready video clips of "smart bombs" surgically excising bad guys with no collateral damage.

Today, it is the Internet, and in particular, social media, that has the brains of so many people utterly enslaved.   Many people get their news and information 100% from Social Media - where rumors and innuendo are the same common currency as the truth.   It is, to say the least, very scary.  

"You furnish me the YouTube Videos, I've furnish the war." - That is what Hearst would say today, if he were a Social Media titan.

But, once again, I digress.   Where was I?  Oh, yea, Google.

Google hasn't been sitting by quietly through all of this.   They sit on the sidelines and look at Facebook and wish they bought it when it was small.    That kind of mind control is priceless!   They tried, of course, to create their own social network, Google Plus, but that was viewed as the Zune of Social Networking.   Since no one signed up, Google made it mandatory that you have a Google Plus account if you want to use their other services (gmail, blogger, YouTube, Google Drive, etc.).   And it is annoying as shit and one reason I want to leave Googleworld for good.

Now, when you log into Gmail, you get this "status update" widget that tells you if someone commented on the same YouTube video that you commented on six years ago.   The only way to put a stop to this, it seems, is to click on each notification and then click "mute post".   It is annoying as all get out.

And even if you set all your settings on Google Plus to "private" you constantly get asked to join someone's circle, or worse yet, other people can add you to their circle (whatever that means) whether you like it or not.   As with Facebook, there is no "dislike", "unfriend", or "despise" button.    Actually, on Facebook, you can unfriend people - and people cannot be your "friend" unless you agree to.  On Google Plus, you can be added to someone's "circle" (jerk?) without your permission.   It is like being violated on a very small scale.

But alas, it is hard to untangle yourself from the web of Google.   Facebook is a little easier to quit.  All you have to do is erase all your content manually, and close the account.   That doesn't mean, of course, that Facebook doesn't keep all your content backed up somewhere.  That is the kind of level of creepy that raised my hackles about Facebook in the first place - and why I quit.   Of course, quitting Facebook does generate hostility from some folks - other "Facebookers" who wonder why you aren't part of their "feed" anymore.   So you run the risk of pissing off some friends, but they are just "Facebook friends" and not real friends, anyway, so the risk is pretty small.

Google, on the other hand is a little bit stickier.   When you log into one Google product, they start following you and tracking you.  You send an e-mail to a friend or client with the word "car" in it, and ads will appear on your Google pages for cars.   They not only track what sites you are going to, what words you are searching, but also what you write and what you e-mail.  This is far scarier than Facebook.

It also, I believe, slows down your internet connection.   While traveling recently, we used a WiFi hotspot, which gets 4G service, when it is available.   When not, it gets 3G, or 2G, or even "G" on occasion.  In "G" mode, it is about as slow as the old 56K modems of yore.  And loading Gmail takes forever (unless you load the stripped "HTML" version, which is missing most features).   Oddly enough, loading Hotmail takes less time for some reason.   Google has so much software tracking what you do that it bombs out slow connections.   And increasingly, it seems that Google products crash Firefox.   Google helpfully suggests that I use Google Chrome instead.   Funny how that works.

So, over the next year or so, I am going to try to wean myself from the tentacles of the Google Empire.  And it won't be easy, as almost everything you do on the Internet seems to touch or interact with Google.   Living without Facebook is a piece of cake compared to not touching Google at all on the Internet.

To completely disentangle myself from Google, I have to do the following:

  1. Uninstall Google Drive
  2. Uninstall Google Chrome
  3. Move e-mail to commercial e-mail account (Cost: about $12 - $25 a year)
  4. Migrate web page away from Google Pages
  5. Move blog from Google Blogger to other host (or erase)
  6. Move videos from Google YouTube to other site (or erase)
  7. Move Google Picasaweb photos to other site (or erase)
  8. Switch to another online search engine
  9. Close Google Plus Account
  10. Close Google Account.

 And that is a lot to do.  I am only on step 3 at the moment.   And this is one reason why I tell people never to store things in the "cloud".  The cloud can evaporate and leave you with nothing, as happened to me with my WebShots account - dozens of carefully tended photo albums with captions and comments, all dumped in the trash without so much as a moment's notice - and no way to easily move them elsewhere.  You rely too much on these online services, and when they go evil, well, you are stuck.

But these experiences only reinforce in me the desire to "unplug" from the media - television, social media, newspapers, etc.   They all hawk bad political ideas, consumerism, lies, outright lies, rumors, innuendo, and slander.  Even getting a basic weather report is dicey, even from the weather channel.

And the fact that I am sort of "stuck" using Google all the time makes me hate it even more.   I don't like the idea that I am beholden to one website or one service provider.   The Internet should be all about choices, not everything funneling into one company's websites.

So, off to another brave experiment.  Can you use the Internet without interfacing with those evil bastards at Google (and they are evil now, despite their "don't be evil" slogan)?

It will be interesting to try.


Friday, October 17, 2014

Why Television is the Enemy...

If you read this blog and still watch television, you won't get anything out of reading this blog.



It is hard to spend money carefully.   Today, I work maybe 20 hours a week, and it seems the rest of my time is occupied with taking care of the possessions I own, or shopping carefully for the things I need in life.  I look back at my old life and wonder, "how did I ever get anything done?"

And the answer is, I didn't.  Like most middle-class Americans convinced they were "making good money" I didn't bother to balance my checkbook every month, or keep track of my credit card bills.  I spend money on convenience items, convinced my time was more valuable than my money.  I hired people to do things I could easily do myself (wash my clothes, clean my bathroom, mow my lawn).

I made good money alright - and spend good money, too.

It was an easy trap to fall into.  At the end of a long day of work, it is easy to convince yourself that you are "bushed" and flop in front of the television and spend $20 on a delivery pizza (if you buy two, you get one free, and then there are cheesy sticks and a tip!).  Before long, you are mired in credit card debt and wondering why.

And you are staring the answer in the face - the television.

I harp on the television a lot in this blog and some folks read this and say, "Well, you have some good ideas here, I mean, besides the not watching television part."

But it IS the main idea of my blog and let me tell you why.

The average American watches 4.6 hours a day of television.   And yea, I was an Average American, at one time.   It takes up all of your non-waking, non-working, non-pooping, non-eating, non-showing hours of your life.  It dominates your life.   It consumes your life.   If you watch 4.6 hours a day, it is your life.

And not surprisingly, television tells us this is OK.   In an ad for "bathfitters" (a company that glues cheap plastic shells over your mildewed tiled bathtub) they show a guy laying on the couch watching television while the bathfitter man re-does the bathroom.   The message is clear: don't get up off the couch.   Why bother doing it yourself when the bathfitter man can just cover it all up?

(And incidental note on "bathfitters":  Like anything advertised on television, it is not a great bargain.   They put a plastic covering over your existing tub, and it looks better than mildewed tile and rusty tubs, to be sure.   But the underlying problems might still be there.  We've stayed in Motels which used such "renovations" and water got in-between the tub and the plastic lining, resulting in a waterbed-like feel to the bottom of the tub.   It is not a real remodeling, but a cosmetic one.  In many instances, a bathroom can be repaired rather than remodeled, for about the same amount of money, if not a lot less.   A rip-off?  No.  A good bargain?  Not in my opinion).

That 4.6 hours a day was the time - my time - that I should have been using to improve my own life.  I could have used it to do things I was paying other people to do - cook my food, clean my house, mow my lawn, fix my car.   I could also have used that time to better manage my finances by balancing my checkbook, keeping track of bills and debt.   And I could have used that time to shop smartly by carefully researching purchases and deciding whether I really needed something (as opposed to "going shopping" and just buying whatever caught my fancy).

In other words, television took up my life.  If you sleep 8 hours a night and work 8 hours a day, that's 16 hours out of 24 right there.  Throw in 2 hours for commuting, and maybe an hour to attend to personal things like bathroom and shower and you're up to 19 hours.   That leaves you five hours a day - and if you spend 4.6 hours of it watching television, well, your life is about 24 minutes a day - or about one minute for every hour to really think about things and make rational decisions.

And that is the second part of the problem.   While you watch television, you are bombarded with a lot of really bad ideas - that perpetual debt is normal, and sending out for pizza is a swell idea, and that the neighbors will be envious of you because you bought a new Acura.   If you watch this stuff long enough, you will start believing it, trust me.

We ridicule other folks for believing in nonsense or dangerous ideas.  How could the Russians embrace Communism when any 6-year-old could see the flaws in it?   How could the Germans think that Nazism was the answer to anything?   The reality is, if enough people start hammering the same ideas into your head long enough, you will start to believe it.   I tell you three times and it is true - that was the mantra of the propagandists.

And we fall for this in America all the time.   We are attacked by Saudi Citizens guided by a man living in Afghanistan, and are told that invading Iraq is the answer.   And people went along with it - all of us - either because we couldn't tell one middle-easterner from another, or we believed that "weapons of mass destruction" were present in Iraq, or whatever.  The television hammered the messages day after day and we all went for it.   Years later, few believe the Iraq war was a swell idea, and the new Iraq "government" is collapsing like a cheap tent.

You can't watch television and not be influenced by its normative cues.   You are not a superman or superwoman.  Your only choice is not to watch.

You can't just watch "a little bit" or "just my favorite shows" without being bombarded with ad after ad for credit card offers, payday loans, or new car sales.   And these ads will program your brain over time.   The only choice is to unplug from the programming entirely.

Was television always like this?   Perhaps, perhaps not.  The amount of advertising today, versus the 1960's is much higher.   On many cable channels, ads are nearly (or more than) 50% of airtime.   Much of the ads today are for more television - selling you the idea of watching more and more, so you watch the ads.   Back in the day, television shows would be "sponsored by" a company, and the ads were much less intrusive.   Today, you get snippets of programming followed by minutes of commercials.

Some programs, when viewed without the ads, are almost comical.  If you watch any History Channel program on Netflix (sans commercials), it seems repetitive and dull.  Why?  Because that cable channel cuts to five minutes of commercials after every five minutes of programming.  They have to "recap" what they said five minutes before, in order to keep their audience.   And then they constantly "tease" the audience with snippets of "great stuff coming up next!" which ends up being a 10-second video at the end of the show.   The entire program is devoid of content, other than the teasing and baiting used to keep you watching.

In other words, it is drivel.   The content is worse, in many ways, than the ads - it provides no coherent storyline or information.  It trains you to have a short attention span and to think in microsecond intervals.

But then again, this seems to be the wave of the future - with twittering and texting leading the way.   No longer do we think in book-length form, but instead in 140 characters (or emoticons) or less.  Television is just the largest of the Distractors.

The Problem With Serial Refinancing

Why was serial refinancing a bad idea?  Why were people told it was a good one?


In the last decade, we have experienced a boom and bust in the Real Estate market, and many people have lost their homes or found themselves in "mortgage stress."   What caused this mess?  Part of the problem was the use of "serial refinancing" to allow people to live a lifestyle they really couldn't afford in the first place.   The idea of owning your own home went out the window in favor of perpetual mortgage payments.
  
Let's crank some numbers and see what I am talking about.   Jim and Cindy buy a house for $220,000 and put down $20,000 as a down payment and obtain a 30-year mortgage for $200,000 at 6% APR which at the time was a reasonable rate.  They pay about $3,000 in closing costs and have a monthly mortgage payment of $1,199.10 (P&I).

From the Bankrate Calculator, we know that after five years, they have paid $58,985.32 in interest payments and owe $182,510.78 on the house.

Wow, five years and you've paid over 1/4 of the value of the home in interest payments.  Scary, eh?   But that is how compound interest works - when you are borrowing.

After five years, they've run into some credit card debt issues from remodeling their home.   And since interest rates have dropped, (and home values have gone up) why not "refinance" their home?   The monthly payment would be less, of course, than the total of their old mortgage and credit card debt payments.   And in five years the home has increased in value.

So they refinance $220,000 on a new 30-year morgage at 5% APR which lowers their monthly payment to 1,181.01 and gives them some more breathing room.

The problem is, of course, they still owe the same amount of money, it is just now spread over a longer period and at a lower interest rate.   They have robbed the equity in their house to pay off credit card debt.  They also spent another $3000 in closing costs to the banks.

Freed of the credit card debt (and enjoying all those frequent-flyer miles) they decide to buy a new car.  And letters come from the credit card companies congratulating them on their financial acumen and announcing that their credit limit has been raised yet again.

Five years later, they are in the same pickle.   Lots of debt from lots of spending, and with car payments and credit card payments, it is hard to make the monthly payment on the mortgage.   And since their last refinancing, the house has gone up in value and interest rates have again dropped.

Since their last refinancing, they have paid another $53,725.43 in interest and now owe $201,683.97 on the house.  If you are astute, you already see they are falling behind here.

They get yet another new 30-year mortgage at 4% interest for $250,000, which gives them a monthly payment of $1,193.54.  Closing costs are again $3000.  Five more years go by and they pay another $48,484.81 in interest and now owe $225,678.97 on their house.

And of course, they get into the same pickle again - new cars, credit cards, expensive trips, meals at restaurants - all charged to high-interest rate "miles" or "cash-back" credit cards (of which they have six).  So they think, "no big deal, we'll just refinance again!"

But something has happened to the Real Estate market this time around.  The economy is tanking and home prices are falling.   Lenders are hesitant to loan money on houses, as many are "upside down" or "underwater".   They get an appraisal on their home (the bank requires one, this time around!) and discover that is worth less than the $225,678.97 balance on the loan.

They are insolvent.   Technically, they are bankrupt.   But they decide to bite the bullet, cash in savings from their 401(k) and make payments on all this debt for another five years before they run out of money and end up in bankruptcy court.   Pretty sad.

But what is interesting to me is how the banks make a lot of money out of all of this.   By resetting the 30-year refinancing clock three times, over 15 years they've paid $161,195.56 in interest payments and still owe $225,678.97 on the loan.

If they had kept the original loan, they would have paid $158,646.37 in interest payments and owe $141,609.08 on the house.

Now, some folks might argue, "Well, see, they only paid a little extra in interest as opposed to keeping the original loan!"   But that fails to take into account the remaining interest.   You see, if they kept the original loan, they would own the home free and clear, in 15 years, after paying another $73,030.01 in interest payments.  Their total interest paid would be $231,676.38

But now they owe another 25 years of payments totaling $131,118.96 bringing their total interest to $292,384.52 - a difference of $60,708.14.

Now this scenario is based on each refinance increasing the balance owed - that is a typical scenario that we saw in the 1990's and early 2000's.   And I know this from experience - I've done it myself.   I was lucky in that I sold out before the market went bust and was able to pay off all this debt.   Most other folks weren't so lucky.

The banks love refinancing, as they get lots of fees in the transactions.   Junk fees, points, and other fees can run into the thousands of dollars.   And appraiser's fees, tax deed stamps, recording fees, courier fees, and closing attorney's fees can run the real costs up $3000 to $5000 for the homeowner.   So in addition to this $60,000 in additional interest, add in $6,000 to $10,000 in closing costs for the two refinancings.

Of course, this is not to say that all refinancing is bad.   Suppose Jim and Cindy decided to refinance after 10 years - and did not run up a lot of additional debt?   And suppose Jim and Cindy decide to refinance the new mortgage for 20 years (as opposed to resetting the clock to 30 years again).  After 10 years, they owe $167,009.21 on their home and have paid $112,100.43 in interest charges, on the original loan.

Their new loan, at 4%, over 20 years, will have a monthly payment of $1,012.04 and over the 20 years left in the loan, they will pay $75,881.10 in interest for a total of $187,981.53 - over $100,00 less than in the first scenario and a savings of $43,694.85 over the original loan.   Yes, refinancing can save you money, provided you don't use it as a vehicle to cash out on your home's equity to pay off credit card debt.

The cause of the Real Estate crash of 2009 was the Jim and Cindy's of the world.    They lived beyond their means and borrowed from the future by taking short-term debts and amortizing them over long periods of time (30 years) using their homes as collateral.   They were "cashing out" on phantom equity in their home, which was "created" when housing prices took a ridiculous turn.

In the post 9/11 era, we were all encouraged to consume as much as possible, apparently to show Al Qaeda that we were not cowed.  I am not sure that was a good idea.

There were a few frugal people who used refinancing responsibly - to obtain a lower interest rate and thus lower their interest expenses.   But those folks were few and far between.   Most were like Jim and Cindy, who bought a Lexus and then financed it using their house.   We all did it.

Of course, if you talk to Jim and Cindy, they have another story.   The Community Reinvestment Act was to blame - by allowing "poor people" (code word for N-word) to buy houses "they couldn't afford" and that caused the collapse of the market.   Nice try, but no sale.   The collapse of the market did not occur in low-income homes, but in middle-class and upper-middle class homes.

So why did Jim and Cindy do this?   Well, the banks certainly encouraged it.   They made money off the interest they charged Jim and Cindy on their credit cards - as well as the 2-4% they charged the merchants for each credit card transaction.   They made money on the interest Jim and Cindy paid on each mortgage.  And they made money on the refinancing fees and points charged on each mortgage.   In other words, they made a lot of money - perhaps twice as much - compared to our second scenario where Jim and Cindy refinance once - and don't "cash out" equity to pay off debt.

From Jim and Cindy's viewpoint - aided by normative cues on the television (talk shows touting refinancing, advertisements, etc.) it "makes sense".  They lower their monthly payments (which is all that matters, right?) and they get a tax deduction for that mortgage interest, right? (actually no, not for debt beyond the original purchase price).  And they are "cashing out" on the boom in the real estate market, right? (actually no, they are just borrowing on phantom equity).

The mortgage broker tells them it is a swell idea.  The credit card company tells them it is a swell idea.   The bank tells them it is a swell idea.   In fact, few people at the time said otherwise.   So it was not hard to get caught up in the maelstrom.

Today, perhaps we see things differently.   Borrowing money is not cashing out on equity.  And by cashing out on phantom equity, you are robbing Peter to pay Paul - in particular, you are impoverishing the future you so the present you can spend more and live more lavishly.

And much, if not most, of this spending was for unnecessary things.   Luxury cars (when a good used regular car would do), restaurant meals (when you could eat more cheaply and more healthy at home), and tchotchkes that clutter up your home (which you end up selling in a garage sale for pennies on the dollar).

No, debt is not a good idea.  And no, we are not preordained to be debtors from birth.  The idea that "everyone has debt, right?" as set forth in a Bank of America cartoon, is just plain wrong.   It is possible to own yourself and not be a debt slave all of your life

It does require two things, though:
1.  You have to sacrifice and learn to live on less (less than you make); and 

2.  It requires you unplug from the media that provides the poor normative cues that encourage you to go into debt.
It really is that simple!  Not easy, of course.   But simple.

Thursday, October 16, 2014

Is the Stock Market Crashing? Hardly.

Is the stock market "crashing"?   The media seems to think so.  The chart above shows a different story.


In the news recently, a lot of panic and fear.  As I noted in a previous posting, fear sells.   CNN says the Fed is "out of ideas" and illustrates the "Wall Street Crash" with this image:

Wow!  I never realized things were so bad!  Oh, wait, this is just an effect of scale change.

You see, when you zoom the scale up by 10,000% and then CUT OFF anything below 15,000, and then limit the time scale to two days, well, you can make the market look "volatile" to anyone.  Well, anyone who doesn't understand math and graphs.   Oh, wait, that's about 99% of the United States.  I wonder who the 1%'er are.  Oh, right, the Billionaires who didn't sleep through math class.

Look at the two images above carefully.   If you look at the top image, you see a correction, albeit a minor one, taking place, after nearly five years of continued economic growth.   If you look at the bottom graph, you see the world falling apart and your portfolio being cut in half - that is, until you realize the bottom graph has been snookered to make it look worse than it is.

Is the market down a bit?  Sure, and you would expect this.  A lot of "dot com" businesses are starting to show their real side - speculative earnings, wild-eyed promises, and no real business plans.   And that brings down the market.   The Fed is easing its "quantitative easing" and interest rates may rise.   That's part of it, too.   Ebola and ISIS (or ISIL?  Make up your mind what your name is, terrorists!) - I doubt it.   Ebola is no big threat to national health and ISIS or whoever they are are only a big threat to Iraq and Syria - countries that are both already fucked beyond recognition as it is.

So why is the second graph so different than the top one?   Well, duh, bad news sells.  And if they can get you to think that the world is coming to an end, they can get you to "keep viewing".

Plebes.  So easy to lead by the nose.  I only wished I figured this out long ago, I'd be a Billionaire by now, too.

Wednesday, October 15, 2014

Mods, revisited

Sometimes it is just best to leave well enough alone.


In a recent article in Sport Aviation, maintenance guru Mike Busch discusses problems he had with a client who had a highly modified Cessna Skyhawk.   The airplane belonged to a flying club, and apparently, the club had the "need for speed" and added one engine mod on top of another, trying to get the plane to go faster.   The end result was, as Busch concluded, not legal and likely not safe to fly.

The article reminded me of my last article about car "mods" and beggared the same question:  If you want to go that much faster, why not simply sell the Skyhawk and buy a faster airplane?

People who think in terms of monthly payments and not overall costs would say, "Well, it's cheaper to 'mod' the Skyhawk to go faster than it is to buy a faster airplane!"

Wrong - on all counts.

This situation reminds me of the plethora of young men who take low-level automobiles and try to make them "go faster" with mods.    They spend more money that they would have buying a faster car, and moreover the overall cost is far higher.

For example, Joe has an old BMW E36 from 1992.   It has a four-cylinder 318 motor and while it handles OK, it is by no means a high-performance car.   Joe decides to "modify" his BMW by installing a turbocharger kit, along with a number of "mods" to the suspension, body, and drivetrain.   He spends thousands of dollars on this process and the end result is a car that has twitchy and unsafe handling, and an engine that is a hand-grenade waiting to go off.

While the companies selling all these add-on parts tell you they are more reliable and safe to use, the reality is, small parts companies don't have the R&D budget to really research this stuff.  Their handling and horsepower gains are guesstimates as best - which is why their literature is somewhat vague when it comes to actual claims.

Within a few years, the turbo blows up the motor (running too lean) and the car is pretty well trashed.  Joe sells it for little more than junk value.  No one wants to buy an old BMW 4-banger that was ridden hard by a kid and "modded" with questionable "improvements".

Like I said, if you add up the cost of all Joe spent on the car plus the "mods", he spent more than he would have buying a six-cylinder 325i.

But wait, it gets worse.

Joe could have decided instead to polish up and sell the old BMW 4-banger as a used car, and used that money to make a substantial down payment on a much faster (and more collectible) BMW M3 of the same vintage.    By then, such cars were coming down in price, and since they were factory "motorsport" cars - and not modded boy-racers - they would hold their value much more.

At the end of the day, the resale value on a well-maintained used M3 is far higher than the scrap value on a ratted-out "modded" 318i.  The overall cost of owning the M3 ends up being less than the cost of trying to "mod your way up" from a 318i to M territory.

And yet Joe fails to see that.   Each "mod" cost a small amount of money on his credit card (except the turbo, which cost a LOT).   So he doesn't see the costs of all this bolt-on junk as being excessive - and he doesn't see the cumulative costs.   Moreover, he fails to appreciate that each mod ends up devaluing the resale value of his BMW, not increasing it.   By the time he is done "modding" a pedestrian BMW, it has little or no resale value at all - no one wants someone's used boy-racer.

They make faster cars.  They make faster airplanes.   If you want a faster car, just go out and buy one.   It is a lot cheaper and more cost-effective than trying to "make" a faster car out of a slower one.

And with this flying club, the same would be true.  Rather than trying to "hop up" an old Skyhawk, they would have been better off just selling the plane (worth more in "plain jane" form than modded) and then using that money to buy a faster airplane.

And it would have been a heck of a lot safer, too!

Sadly, it is all too easy to fall into this game.   You buy a car or a plane or a boat and think, "Gee, this is a swell car/plane/boat but if only it had...." and you start shelling out money at the car store, the boat store, or the plane store, on some add-on doo-dad which will make your pedestrian ride "just like" the big boys.   But of course, it doesn't, so you go back to the well, hoping that "this time for sure" some add-on will "upgrade" your vehicle to the next level.   It doesn't, of course.

It is cheaper just to upgrade to the next level.

But it is even cheaper to just appreciate your vehicle for what it is.   The old 318i is a nice handling car and a reliable mode of transport.   Not fast, but precise.   The Skyhawk is no speed demon, nor was it meant to be.   But it is a nice plane to build time on and see the sights flying "low and slow".  It is one of the most popular airplanes made - the "general" in "General Aviation" - a flying Toyota Camry, if you will.  Trying to make it into a rocketship is just a waste of time and money.

Sometimes, leaving well enough alone is the best idea!

Tuesday, October 14, 2014

Your Condensate Drain

Uh, oh, someone's condensate drain is clogged!

It never ceases to amaze me how people are willfully ignorant about things.   If you live in America, you will own, in your lifetime, maybe a half-dozen each of refrigerators, stoves, microwaves, dishwashers, and the like.   You will probably have a few toilets.   You may own a dozen cars or more.   And you likely will own at least one air conditioner - mostly likely three or four.

Yet most folks have little or no idea how to even operate these appliances, much less how they work.   And in order to do the former, you have to know something about the latter.   It is like trying to drive a 5-speed without understanding what a clutch does.   You'll never get it right, no matter how much you try.

We've been gone a few months and when we came back, I found the condensate drain on our A/C system clogged.   A few pitchers of hot water (and some simple green) later, it is unclogged.   The outside portion got buried with lawn debris, and it backed up and formed a gelatinous goo inside.  It was disgusting.

What is a condensate drain and how does it work?

Well, to understand this, you need to understand something about how A/C systems work.  I'm not asking you to take Thermodynamics and understand Entropy and Enthalpy.  Thermo is a hard course - I took it three times.   Rather, you should understand the basics of how A/C systems work.

Basically, refrigerant (what people call "freon" sometimes) is compressed by a compressor into a liquid.   This liquid is hot because it has been compressed.   An outside coil and fan cool the liquid, which is then passed to an expansion valve.  The expansion valve works like the nozzle of a spray can, and turns the liquid refrigerant into a gas.   This phase change is what causes the cooling effect (just as ice changing phase from solid to liquid is what cools beer in your cooler).    The gas cools when it expands, and this cold gas is passed through another coil inside your house, and a fan blows air over it, which then cools your house.  The gas then goes back to the compressor for another ride around the loop.

OK, so that's A/C for morons.  Not hard stuff.   So where does the condensate line come in?  Well  you have to understand how air works, as well as refrigerant.  And few people do, based on the number of fogged-in cars I see driving around.

Air can hold water basically dissolved in it.  We call this humidity.   Just as you can dissolve sugar in water, you can dissolve water in air.  How much water you can dissolve in air depends on its temperature and pressure.   The colder the air, the less water it can hold - which is why it gets drier in the winter.  When warm, moist air passes over the cold A/C coils in your air conditioner, the water falls out of solution and condenses on the coil surface.  This drips down into a pan and then is drained outside (usually) by a condensate drain.

In a car, the same thing happens.  Problem is, in a car, you can choose "recirculate" or "outside air".  When you do the latter, you are basically trying to air condition planet earth, with predictable results.

You see, any air conditioning system is basically also a de-humidifier.   A de-humidifer is just an A/C unit with both sides in the house.   If you want to "dry out" a house, (or a car) run the A/C.   Funny thing, but people don't get that.  They think if you turn on the heat, it will dry out the house (or a car) but usually all that does is create a hothouse effect.   (Turning on the heat AND the A/C, however, works best.  By heating the air, more water will dissolve (evaporate) in it.  By running the A/C, this water condenses out and drains out the condensate drain.  Just running the heat does nothing, as the water has no place to go!).



Few people understand the science of defrosting.

Getting back to the condensate drain, this tiny pipe can easily clog over time, as mold, mildew and even bacteria colonies grow in it.  Insects may clog it.  Dirt may accumulate.   When this happens, the drip pan in the A/C unit will overflow, usually into your house, possibly ruining your floors or just making a puddle in the basement.

Keeping this line clean and clear is a good idea.   Make sure you know where it exits the house and make sure the yard man does not cover it with lawn clippings (as happened to me).  Run some water through it on occasion (it should be plumbed with an access point to pour water in).   Make sure the outlet of the drain pan does not become clogged.

If all this seems too hard to do (and it is for many folks) then hire an A/C company and sign a service contract.  They will come by your house 2-4 times a year and clean the condensate line, check charge levels, change filters, and clean coils.   It is worth the money, as it avoids problems in advance.

In some installations, a small "condensate pump" may be used to pump the condensate outside or to a drain.   If this pump clogs or fails, it may overflow and leak water all over the place.  Sadly, most installations with condensate pumps are places where a water leak would mean disaster.   So when the pump fails (or the line clogs) you end up having to repair floors or sheetrock or whatever.   If you have a condensate pump, you could check it regularly or get a service contract.

If you don't know whether you have a condensate pump or not, maybe you need to get a service contract.

Death of PayPal? Maybe.

PayPal has made a lot of money on Internet transactions - some say too much.   Banks have taken notice of this and are offering cheaper and easier ways to transfer money online.

I have written about PayPal before.  It is an OK service, but it has its issues.  First of all, they charge a LOT of money just to transfer money - about as much as the Credit Card people do, perhaps more.   And that's a lot.  The guy who founded PayPal had enough cash in his pocket when he sold it to start his own electric car company - and a spaceship company.  That's how much money they make.

PayPal has other problems besides "charging too much" for its services.  A lot of its add-on services have been clunky and hard to use (and also expensive).   PayPal virtual terminal, for example, is overpriced and hard to use.  I checked it out and decided to use LawPay instead.

Their "Buy It Now" button, designed for e-commerce, was also clunky and hard to use.  It was hard to integrate into websites (such as google sites, for example - as they wanted you to use googlepay) and it limited the number of transactions any one customer could make on your site.   Clunky and stupid.

And every time you log onto PayPal, there is some odious offer screen you have to click through.  They want you to get a PayPal debit card, credit card, phone "app", or "pay later" option, none of which are good bargains.   And they make it hard to get around these "offers" by putting the "no thanks, I'm not that stupid" link in tiny lettering at the bottom.   They have all the charm of the folks at Motley Fool.

And like the Obama re-election team, PayPal loves to send you lots and lots of e-mails with "exciting offers" giving you "$20 to spend!" at some online retailer you've never heard of.   Of course, no one is giving away free money this week - some restrictions apply.

And then there are the scams.  PayPal isn't complicit in these scams, of course, but they seem to be always one step behind the scammers.   Next to Western Union, it seems that PayPal is the scammers second-best-friend.

But all that aside, does PayPal have what it takes for the long run?   Sure they have a big Internet presence and a big name recognition.   So did IBM, at one time.  And in terms of name recognition, PayPal has the same problem as Hillary Clinton - the "high negatives" issue.   People use PayPal not because they love the service, but only because it often is the only way to consummate a transaction online.  No one has warm and fuzzy feelings about PayPal - and much of this goes back to the early days of the service, when they sort of ran rogue, as I noted in an earlier post.  Today, these bad vibes are fueled further by the high fees PayPal charges.   It is about as popular as a Cable company.

So, customers will jump to the "next big thing" that comes along that can supplant PayPal.  And the banks are cooking up the "next big thing" as we speak.   One of my suppliers overseas used to use PayPal.   They got tired of handing over a big chunk of each paycheck to PayPal and now use Chase QuickPay.   Most banks are offering a similar service, where you can pay anyone, anywhere, just by using an e-mail address.   No account or routing numbers needed.  And the fees are low or non-existent.

As with online bill payment, one wonders how the banks make money at this.   At least they don't have to print checks and then put stamps on envelopes.   The answer, like online bill payment, is that by offering this service, you attract customers - and deposits.   Moving forward, it will be harder and harder for smaller banks to compete, if they cannot offer online bill payment, online transfers, and other electronic banking services.

I use a small bank here on our island, as it is handy to make deposits without having to go to the mainland.   However, you can now deposit a check from anywhere in the world, using your smart phone (by taking a picture of the check) so that advantage is evaporating.    I can make electronic transfers online between than mom-and-pop bank and Bank of America, so I can deposit a check in one bank and then move the money over with a click of a mouse.   It is pretty neat and handy - and more than a little frightening.

The point is, the banks aren't asleep while PayPal is raking in the dough.  They are offering more convenient and easier ways to pay online or by app.   PayPal, in contrast, remains a clunky service that really is limited to eBay and a few other outlets.   Using PayPal is akin to having an AOL account these days - it marks you as an internet dork.

eBay alone remains a huge market for PayPal.   But ask yourself this - when was the last time you used e-Bay for anything?  While once the source of great bargains in a peer-to-peer transaction, eBay has repositioned itself as a "powerseller" marketplace - trying to compete with Amazon.   And Amazon will clean eBay's clock.    I find myself using eBay less and less, as there are fewer bargains to be had there.  And many sellers are shying away from it as well - due to the high fees charged by eBay, which are nearly doubled by the high fees charged by PayPal.   You sell something on eBay these days and you're lucky if you make any money at all.

So, going forward, I see trouble for PayPal.   They can't seem to expand beyond the eBay marketplace, and there are so many other better (free) ways to send money online these days.

And I doubt PayPal can beat "free" in terms of pricing.




Monday, October 13, 2014

Selling FEAR again

Fear is never an emotion to be trusted.  When someone tries to sell you fear, back away!

The media is at is again, hyping fear as usual.  You should be afraid, they tell you, because all sorts of horrible things are happening:
The Stock Market is crashing and investors are panicking  The stock market has been doing very well over the last six years - since Obama took office. It is to be expected that after a record bull market, there will be some bears.   A 1% drop isn't great, but neither is it the end of the world.   Companies that continue to churn out earnings and dividends will continue to hold value.  Companies that are speculative will continue to fail.   The DJIA and other indexes are, in my opinion, too heavily weighted with the latter, with tech stocks making up too much of these indexes.  When the price of Apple and Facebook are used as indicia of the health of the market, you might think the market is sick.

The Ebola Virus will wipe us all out in a matter of months!  Well, again, not exactly.  One person has died, in America, after returning from Liberia.  This is out of a nation of over 300 million people.  Meanwhile, 40,000 people die every year in car crashes, yet even a gory wreck hardly makes a headline.  Put things in perspective.

Islamic Terrorists are taking over America and beheading people!   Well, OK, one person.   Hardly a Jihad, just a crazy person.   On that same day, dozens of other crazy people shot others with guns, and it hardly makes the news anymore.

Internet Hackers will hack into your smart thermostat or light bulb and take over your home!   And do what?  Turn up your thermostat?   The article on CNN hyping this fear has a link explaining the "shellshock" virus is actually no threat at all - unless your smart lightbulb is connected directly to a server.
And so on and so on.  The media loves to sell FEAR and this month, they are having an orgy of it.  Between Ebola and ISIS and "stock market crashes" they hype the fear on top of fear.  Oddly enough, many of the articles - if you bother to read them - say there is little or nothing to actually fear.  But the headlines are another story.  "Should you be afraid of ISIS?" and that sort of thing.   People read the headlines, but not the last paragraph of the article.   Fiberglass Horses.

You can sense the media's frustration, too.   Why aren't we are all panicking?   CNN laments that despite its best efforts, Americans are still happy.   Keep trying CNN!   Eventually we will all be on Prozac, if you just keep up the drumbeat of bad news!

Yes Americans are still happy.  Funny how that works - that people living in the wealthiest country in the world with the highest standard of living in the world, would actually end up "happy".   ISIS and Ebloa are far more serious threats to folks in Syria, Iraq, and Africa.   Seriously - just read the box scores.  America:  1 beheading.   Syria:  1,000.    America:  1 Ebola Death.  Africa:  3,000.

A lot of what is screamed in the headlines is indeed tragic - for people in other parts of the world.   And we should be concerned about these tragedies, of course.   But there is something obscene, in my mind, when Americans posit themselves as "victims" or potential victims, of these international events.   Even the events of 9/11 - as devastating as they were - pale in comparison to routine violence, death, and destruction which visits the rest of the planet on a regular basis.

Why does the media sell fear?  Because fear sells.  People are far more likely to "stay tuned" for a fear-based TeeVee segment or click on fear-based article.  And the media people know this, as the Internet monitors what we click on and the Nielsen people know what we watch.   So they know that people will go for "everything's awful!" but not for "Gee, things are swell!"

It is human nature.  Every story has to have a crises or drama.  Man against Nature, Man against Himself, Man against Man.   You don't have a "story" that goes, "Once upon a time, everyone lived happily ever after."   There has to be a story "arc" - right?   Or so we think.   Happily ever after is very underrated.

Even when things are going swell, the media sells fear.  If the market is going gangbusters, they tout "Will the market crash?" headlines.   If terrorists haven't struck recently, they tout, "Where will the terrorists strike next?"  

How do you avoid this sort of nonsense?  The simple answer is: UNPLUG.   Stop watching network television, particularly network news.  It does not "inform" you of anything.   Stop clicking on fear-based articles on the Internet, and stop believing in them.

Perceive reality for what it is, not what the fear-mongers want you to think.   As Americans, we live in a very safe and comfortable and prosperous place.   The world isn't about to end, just yet.   Being afraid all the time does nothing for you, personally.   But as I noted before, cowed and fearful people (depressed people) do make excellent consumers!

This segment of "Terrorists are all out to kill you with Ebola" is sponsored by Exxon!

How to do an Intervention!

Staging an Intervention is easy as pie!

A reader writes that their parents want them to "intervene" in the life of a sibling, to "help" that sibling with their hoarding disorder and other personal issues.

And intervention!  What a neat idea!   What could be easier!  It reminds me of this Monty Python bit (see video above) called "How to Do It!":

Cut to a sign saying 'How to Do It'. Music. Sitting casually on the edge of a dais are three presenters in sweaters - Noel, Jackie and Alan)

Alan: (John Cleese) Hello children.
Noel: (Graham Chapman) Hello.
Jackie: (Eric Idle) Hello.
Alan: Well, last week we showed you how to be a gynecologist. And this week on 'How to Do It' we're going to learn how to play the flute, how to split the atom, how to construct box girder bridges and how to irrigate the Sahara and make vast new areas cultivatable, but first, here's Jackie to tell you how to rid the world of all known diseases.
Jackie: Hello Alan.
Alan: Hello Jackie.
Jackie: Well, first of all become a doctor and discover a marvelous cure for something, and then, when the medical world really starts to take notice of you, you can jolly well tell them what to do and make sure they get everything right so there will never be diseases any more.
Alan: Thanks Jackie, that was great.
Noel: Fantastic.
Alan: Now, how to play the flute. (picking up a flute) Well you blow in one end and move your fingers up and down the outside.
Noel: Great Alan. Well, next week we'll be showing you how black and white people can live together in peace and harmony, and Alan will be over in Moscow showing you how to reconcile the Russians and the Chinese. Til then, cheerio.
Alan: Bye.
Jackie: Bye-Bye.
(Children's music.)

And that, in short is how "easy" an intervention is!   You just get a bunch of friends together, go over to your troubled friend's house, and sit him right down and explain to him why his addictions and other problems are doing him no good!   He will say, "Jolly well, you're right!  I'm giving up my methamphetamine habit today!"

And once again, you've saved the world.

Nice fantasy.   But that's all it is.  And in a way, it is a sick fantasy - the idea that "we" are all perfect and have our shit together, and are in a position to tell other folks what for, and moreover that they will just sober up and say, "Gee, you're right!  I never realized heroin was so bad for me!"
_______________________________

Letting people face the consequences of their choices is often the greatest kindness you can do them.  Insulating them from consequences is often the greatest cruelty.
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There are a number of flaws in the "intervention" theory, which is one reason why this 1990's trend has faded from the scene.

1.  They don't work.    People with addictive and compulsive-addictive personalities, mental health issues, drug habits, alcoholism, hoarding, or whatever, can't just "kick the habit" after a two-hour long "intervention" by some friends.   These problems are protracted and ingrained and require years of therapy and help (and often medications) to cure - if they can be cured at all.  The sad reality of mental illness and addiction, is that few people are ever "cured" of it.  They take it to their graves.

2.  Who are you to say?   If you are paying 22% interest on a "miles" credit card, you really don't have your own shit together, either.   Maybe it isn't as bad as a meth habit, but it shows that you are not taking life seriously.  Rather than going around trying to "fix" other people's lives, you should concentrate on fixing your own.  And no, this isn't being "selfish".   If everyone concentrated on improving themselves, as opposed to improving others, well, we wouldn't need "interventions" at all.   And yes, some of the folks who like to "intervene" are the ones most needing an intervention of their own.

3.  Leave it to the professionals.   Drug addiction, mental health issues, alcoholism, hoarding, and the like, are not something amateurs should diagnose or attempt to repair.   You may do more damage than good, although in most cases, you just end up doing nothing and wasting your valuable time.

4.  What are your real motives?   Many people who want to stage interventions do so in order to feel better about themselves.   They want to show others (the other attendees at the intervention) that they "care" and moreover have their shit together enough to not only handle their own lives, but the lives of others.  It is a pretty sick scenario.  I am not saying that all interveners are like this, but usually the person organizing one of these lynching parties is usually the type.
5.  Change has to come from within.   An alcoholic won't stop drinking because someone told him not to.   The meth addict won't stop because his friends said not to.  The hoarder doesn't think he has a problem, period - which is why it is the hardest compulsion to break, if ever.   If any of these addictive/compulsive behaviors is to change, it has to be from the person involved, not an external force.   It is like the old joke, "How many psychiatrists does it take to change a light bulb?  One, but the light bulb has to want to change!"
6.  You create two victims.  If you squander all your energy and money trying to "help" someone else, and they refuse such help (or abuse you) - which is quite likely - all you have done is now create a second victim - yourself.   I know a plethora of such folks, who will regale you for hours about how they tried to help Mom or Dad or Brother or Sister or Uncle, and ended up being abused instead.   Mom gets into debt problems, so Son bails her out and buys a new set of tires for her car (which he can barely afford to do).   Mom shows up the next day with a new car, financed at horrific rates.   She has learned nothing other than her children are patsies and will bail her out.  Letting people face the consequences of their choices is often the greatest kindness you can do them.  Insulating them from consequences is often the greatest cruelty.

"Well," some might say, "You're always telling people what to do in your blog!  Why don't you follow your own advice?"

Nice try, but no sale.  You see, I wrote this blog for my own edification, not as a teaching tool.   If someone gets something out of it, fine.  If not, they can piss off.   And like the First Lady promoting healthy eating, I am not "telling people what to do" but merely pointing out that spending all your money and then borrowing even more is a really bad idea.   I am not forcing anyone to do anything or 'intervening' in their lives.

"But what about family members!  Aren't I supposed to be my brother's keeper?"  And the answer is, well, NO.   You are not obligated, just by familial relationship to "take care" of a sibling, once you have left home and formed a life (and family) of your own.  You primary duty is to take care of yourself, your spouse and your own children (if any) before you go running off to help a brother, sister, Uncle or parent.

Yes, it is a tragedy when a parent or sibling suffers from mental illness or drug or alcohol problems.   But no, you can't "fix" them like you would an old car (which itself is a messy and expensive process!).   The best thing you can do is leave it to the professionals (and move and leave no forwarding address).  You are not obligated to "fix" other people, help other people, or be a punching-bag for abusive people.  Fix your own life - be kind to yourself.  I give you permission.

Of course, there are some who prefer to "intervene" so they can be the friend with the perpetual problem.

If you see a friend about to drive their car off a cliff, you should warn them there is a cliff ahead.   But don't be surprised if they ignore your warning - and tell you they are taking a shortcut!

The key thing is not to be in the back seat when they drive the car off the cliff.