Saturday, July 30, 2011

The Hamster Wheel of Debt

This is you, in debt, working hard and accomplishing nothing.


Debt is so ingrained in our society that most people think it is like the air you breathe.  One of the hardest things to do in our society is to break free of the debt mentality.  After all, it is thrown at you, like a firehose, on the TeeVee all day long.

Buy a car, go into debt.  Go to school, go into debt.   Get a credit card, go into debt.   Buy a house - go into lifelong debt.   Improve your home - add more debt.  Consolidate your debt.  Borrow against your paycheck, your life insurance, your home, whatever.   Mortgage or pawn everything you own - debt, debt, debt!

The problem with debt is self-evident, but most people fail to see it.   First, you have to pay it back.  So you borrow $20,000 to buy a car - you have to pay that back.  And by the time you do, the car is worth maybe $10,000.  And maybe, that is the car you should have bought in the first place - the $10,000 used car.  But since the "monthly payments" are so low, you buy more car than you can really, really afford.  Or worse yet, lease.

The second thing is interest.  Since you pay several percentage points in interest on a loan, that means for every dollar you spend, you end up with a few percentage points less in real buying power.  It really is a no-brainer - give me a dollar, and I'll give you back 95 cents.  Is that a bargain?

Of course some folks claim esoteric arguments, such as "well, since I am improving my cash-flow, I can invest that money I would have spent, paying cash, and make more!"  But of course, in most cases, the interest on debt approaches or nearly equals, what you would earn by "investing".   And in most cases, the people making this argument don't have any spare cash to invest - rather they just want a new car and use these specious arguments as post hoc justifications for poor financial choices.

And by the way, your 0% or  2.9% financing costs a lot more than that, when your forgo a $1500 rebate.  Yea, the banks aren't stupid, and they are not loaning money for cars at interest rates lower than home mortgages.   Only consumers are dumb enough to believe this.   Or hamsters.

And most of these people have no clue what cash-flow means, anyway.  What they are doing is increasing their cash-flow requirements, to the point where they are living "paycheck to paycheck" and then cannot afford to lose a job, even for a month, without their entire house of cards (house of debt) falling down around their ears.

So how do you get off the hamster wheel of debt?  Pay cash, consume less.  When you have to pay cash for a car, your options are limited - and you shop more aggressively on price.   Suddenly, the idea of spending $2000 to $5000 extra on a car to buy it brand-new at a dealer makes no sense - when you can buy the same car, secondhand, from an individual, for a lot less.  When you have cash, this is readily apparent.   When you are making monthly payments, it is "only $10 a month more!" and you don't see the damage done to your bottom line.

Yea, it would be nice to "have it all" and have lots of nice toys.   But if you want to get ahead in life, yo can't treat every day like it is Christmas, and Santa is coming.  New cars, smart phones, subscription services - they all add up.   And they are all things you WANT but don't NEED.

OWNING MONEY is the definition of wealth, not SPENDING it.   And the sooner you figure this out, the sooner you are off the hamster wheel.

Having a new car in your driveway and 60 months of loan payments and high insurance costs is not a good bargain or a lot of fun.  Having a "paid for" car with low insurance payments is - because it allows you to do more things with your money and be wealthier overall.

And let's face it - both cars look the same after a year.

You are not your credit rating.  Borrowing money is not some great privilege.   Buying a new car is not some great personal accomplishment, if it is done all on credit.  Going into debt is going to make you more and more unhappy and unhealthy, over time.

Working toward being debt-free means rejecting our entire society's normative cues and values and thinking for yourself.

And it is totally worth it, unless you want to be a hamster.

And if you want to be a hamster, stop bitching about how shitty a deal it is, living "paycheck to paycheck"  or how crappy the hamster food tastes.  This was your choice - to have a shiny new hamster wheel and go into debt.  Kitcherbitching!

Or charge your perspective on debt and consumerism....

Who is to blame for the Debt Debate? Boehner.

A flattering photo of rep. Boehener of Ohio.

 A lot of the debt ceiling debate is marked by credentialist arguments ("Joe Blow, famous economist, favors MY plan, so it must be good!") or just chanting of slogans, enforcement of "pledges" made to non-government entities, and basic fear-mongering and bullshit.

What is the real deal on the debt ceiling?  Is our national debt going to bankrupt our country?  Or is our failure to deal with the debt the REAL problem?  A little of the former and a lot of the latter.

There are a lot of misconceptions about the debt, and here are a few I think need to be clarified.

1.  It's Obama's Fault:  Budget bills, under the Constitution, are to originate in the House of Representatives.   Thus, it is the responsibility of the House, not the White House, to present a budget bill and also to figure out the debt ceiling.   Rep. Boehner, as leader of the majority is thus responsible for bringing a bill to the House floor that will pass, pass the Senate, and be signed by the President.  Boehner is the man in the hot seat, and yet he passes the buck to Obama or Harry Reid.

2.  The debt will kill the country:  While debt is bad (the entire point of my blog is about being debt-free) the dire predictions about the national debt are a little overstated.  Yes, our debt is about equal to one year's GDP in this country.   But then again, a typical American has debt equal to several years of their personal GDP.  So this is hardly a staggering amount. In addition, our GDP is down, which makes the debt seem higher.   Once the economy recovers, the debt load, as a percentage of GDP, will decline.  And as revenues increase with the GDP, we can pay it down.

3.  Debt is responsible for the recession:  Actually right now, the reverse is true.  Economists have long argued (and been proven right) that when you have a recession, the best thing to do is spend your way out of it.   It sounds dumb, but it works.  In 1929, Hoover tried to cut back on spending, and this served only to make things worse.  Roosevelt spent money on public works projects and got the country moving again.  The pattern has been repeated again and again over time.  When government "primes the pump" it gets people working.  When you cut government spending right now, it will throw a lot of people out of work, and increase the length and depth of the recession - right into an election year.   This indeed, is probably the Republican's plan - to exacerbate the recession so they can elect one of their own in 2012.   Remember this - the GOP is making you suffer so they can get elected to Office.  Can you think of another political party in the 20th Century that destroyed its own economy just to get into power?  Hint:  It was in Germany.

4.  Obama Caused the Debt:  Conservatives like to point to the stimulus package as the cause of our debt.  But the bulk of our national debt is quite old, and a lot of it was incurred during the Bush era, when we spent large to go after Al Qaeda.  During boom times is when we SHOULD cut the debt, but since it seems small as a percentage of GDP, no one does.   Although Bush and the Republicans controlled the Government for 8 years, they failed to live up to their fiscal conservatism and cut the budget - rather, it increased.  During the first two years of the Obama Administration, more debt has been incurred for unemployment, welfare, and of course, the stimulus package.  But if we didn't spend that money, we would be in a 1929-like Depression right now.

5.  The GOP Will Create Prosperity By Eliminating Debt:  This is a nice fantasy, but in reality, what this amounts to is maintaining tax cuts for the rich, while cutting the Social Security and Medicare that the middle class has relied up for retirement.  And since their bungling of the debt problem (and downgrading of U.S. Bond ratings) has severely damaged the economy (the Dow has lost ALL GAINS since January of this year - in one week!) many of the middle class are facing a bleak retirement, of ravaged bank accounts, cuts in Social Security, and limited medical care.  Meanwhile, the tax brackets for the very wealthy remain cut.

6.  The GOP Will Cut Your Taxes or Has Cut Your Taxes:  The GOP runs on a platform of tax cuts - both in terms of income taxes and in things like the gifts and estates tax.  Poor people mouth the language of Fox News Talking Points - "I'm Taxed Enough Already!"  But as I noted in an earlier posting, if your combined income is below $60,000 (the average American) then you never saw a penny of the "Bush Tax Cuts" as you are in the unchanged 15% bracket.   Even if you made more than this ($100,000 to $150,000), you saw little in cuts.   It is only when you make a quarter-million dollars or more than you see any serious cuts.  And as far as the "Death Tax" is concerned, you will never pay it anyway - unless you are a multi- multi- millionaire.  Yet poor people continue to believe that Bush "cut my taxes!"

7.  The Debt Ceiling Deadline is Arbitrary:  In two days, the Government will have to shut down many offices.  Contractors will remain unpaid.  I suspect that Social Security checks will go out on time, and even debt payments will be made.   But there will be another government shutdown, and it will not be good for the economy or for the people.

8.  We Need to Cut Entitlements:   While a lot of people are collecting welfare, most entitlements are paid out to people who PAID INTO the system.   Most Social Security recipients have paid into the system and expect to get paid back.   As I noted in that previous posting, Social Security, on average, pays you back what you paid in, plus a paltry 2% interest.  It is hardly a "government giveaway" but more of a loan program.  It was a promise - just as a government Bond is a promise (and not a "transfer of wealth scheme").  You pay in, you get paid back.   More welfare reform is a good idea, but cutting Social Security - or worse yet, instituting a "needs test" just turns it into what the teabaggers claim it already is - a transfer of wealth scheme.

9.  It is impossible to balance the budget any other way than to cut, cut, cut:  We have some of the lowest tax rates in the world.   And in the middle of two major wars, our last President decided to CUT taxes further.  We have to pay our bills, and this means paying for the war in Afghanistan and Iraq.  It means paying for all the pork-barrel spending the GOP Congress  engaged in, during the Bush years (and they engaged in a LOT, which is disappointing to a fiscal conservative!).   And yes, it means we have to pay for the stimulus package as well.  The Bush-era tax cuts for the very wealthiest brackets need to go away.   And these were not huge cuts - only a couple of percentage points.  The very wealthy can afford a couple more percentage points in taxes - but it will mean big increases in revenue for the country. 

Here is a chart of the actual tax rates.  Again, if you make $60,000 a year or less, you are in the 15% bracket.   Show me on the chart where you big tax cut is....

1993 saw a tax hike on the wealthy (via two new brackets at the top), and then 2001 through 2003 saw a series of tax cuts (the so-called Bush tax cuts)  that lowered the tax brackets as follows:

  1992   1993 -
2000
  2001  2002  2003 -
2010
  2011 -
2012
  2013
?
15% 15%15%10%10%Same
as
2010
10%
15%15%15%
28% 28%27.5%27%25%25%
31% 31%30.5%30%28%28%
36%35.5%35%33% 36%
39.6%39.1%38.6%35% 39.6%

So what is the solution?  Compromise.   That is how politics work, period.  The majority of the Democratic Party and a large portion of the GOP are prepared to compromise.  But Rep. Boehner, for some reason, thinks that the only way to pass a bill is to get all Republicans on-board and forget about the Democrats.  But a Republican-only bill will not pass the Senate or be signed by the President.  Boehner is bowing to a small minority of Republicans - and an even smaller minority of Americans, in drafting his legislation.  When we let loud, vocal minorities (often misguided) dictate events, very, very bad things happen.

When your 401(k) evaporates, and inflation surges because our bond-rating drops to AA - and the US is no longer viewed as the "safest investment on the planet" - remember who to thank - the guy in the photo above, and the "new" fiscally irresponsible GOP.

When you retire and find that your Social Security is cut and your medicare is a "voucher" good for one free doctor visit, remember who to thank - the GOP.

The Republican Party has fallen on hard times - lack of leadership.   We need great leaders in this day and age, and what do we get?  Donald Trump, an actor who plays a Millionaire on TeeVee - and Sarah Palin, a media floozy who decries media floozies.

You have to wonder what Barry Goldwater would have said  (WWAuH20D?).  Certainly not this nonsense...

Thursday, July 28, 2011

The Bicycle Trap

Rule #1 for the serious cyclist:  Never Smile!  This is not fun, dammit, and bicycles are not toys!

We get a lot of yuppie jerk-asses who come here to the island.  They drive 20 miles from a neighboring island to come over here and annoy the snot out of us.  Why is this?  Well, they ruined their own island through over-development and by building tacky and cheaply made mini-mansions and strip-malls.  Heck, they even have stoplights there, if you can imagine that!

So they come here, because our island is less crowded.  Go home!  Stay on the island you fucked up, don't bring all your bad vibes over here!  The next thing you know, they'll be demanding we build them a Starbucks!  Goddam Yuppies!  Hate them almost as much as dirty stinking Hippies!

And they come in their Lexuses (Lexi?) with their $5000 carbon-fiber racing bicycles (no "fixies" yet, but wait for it) and their fake racing uniforms "Just like Lance Armstrong has!" and all the accoutrements and accessories a "serious cyclist" needs, which doesn't include, of course, a sense of humor or even humanity.  They all look alike and dress alike, like streamlined alien clones.

Back in Hemingway's day, they used to joke about people going on safari in Africa, all fitted out by Abercrombie and Fitch.  Back then, before it became an overpriced Gay T-Shirt store, they sold safari and camping gear, on 5th Avenue in New York, so all the wanna-bes could get kitted out for deep sea fishing or African safari.   They even sold elephant guns.  No kidding.

But it was a joke.  These rich folk just trying to buy their way in to something.  Everyone laughed at them.  And the same is true for these "serious cyclists".   They think that by running up credit card debt, they can become the next Lance Armstrong.   But it is all posturing and posing of the worst sort.

And worst yet, they ride on our shoulder-less roads, which is not safe, and then get all pissy when you try to pass them.  We have miles of bike trails on our island - it is sort of famous for that, going back to 1910.  And you can ride on our rock-hard beach, too, which, with a tailwind, is fun.

But you need a beach cruiser or mountain bike for that.  And the "deadly serious cyclists" would never do that, of course!  Too much rolling resistance!  Uh, why were you doing this again?  To get exercise?  Or just to be a poseur.  The latter, I'm afraid.

I have a much-battered and well-loved decade-old TREK that I think I paid $450 for new, which I thought was a lot of money.   But I can ride it on the trails and on the beach and NOT constantly feel the hot breath of a Buick behind me.  And it is great exercise.   And when I am done, hose it off, spray the chain with WD-40 and it's good to go.  I think half the gears are shot, but on a flat island, what do you need more than 3 speeds for?

So why do the "serious cyclists" buy these expensive bikes and ride them around annoyingly?  Because it is a status thing - to brag and show off to the other "serious cyclists" how much you can afford to spend on a disposable commodity.  And to show how "serious" you are about the "sport".

But it is not like they are training for the Tour de France or anything - or even a local race.   They are just showing off in the typical annoying Yuppie way - by buying things.

You know, I detest "serious" people.  They really know how to suck all the fun out of life - turning everything into a competition of expert-ism.  What is the point?  And they can never laugh, particularly at themselves.

But beyond the fact that these people are a living joke and annoy the snot out of everyone, there is a far more substantive reason not to get caught in the "serious cyclist" trap.   And that is your inevitable collision with an automobile.

Riding a bicycle in traffic, particularly on a road with no shoulders (like the GW Parkway, at rush hour) particularly when there is a BIKE PATH, is just suicide.  A 6,000 lb SUV going even 35-45 mph will crush you and your $5000 bike into nothing, and in a real hurry.

And how do I know this?  I have friends who have been hit - or have had a loved one hit.  The lucky ones survive - with months in the hospital and years in rehab.  The unlucky ones leave behind a widow and child - years before their time was due.   And for what?  To show off your new spandex bike shorts?

Yea, yea, yea, the driver was at fault.  So what?  When you are bleeding out on the pavement, looking at the underside of a car in your last moments of life, that is cold comfort.  It is just incredibly dangerous and foolhardy.

Fortunately, there ARE an increasing number of places in this country where you can ride a bike and not be molested by cars - miles and miles of bike paths are being built everywhere and "greenways" are turning old railroad tracks into bicycle commuter routes.

But the "serious cyclists" look upon such routes with disdain.  Their racing tires will sink into anything softer than asphalt.  And their thin rims will bend to a pretzel when they hit their first tree root.  As a "serious" mode of transportation, the racing bike leaves a lot to be desired.

Posturing and playing pretend dress-up is never a good idea.  It is not real, just an act and an expensive one at that.  Bicycling should be fun, not a soul-sucking hobby that bankrupts you.   One of the best aspects of bicycling is that it is CHEAP and FUN, and yet, the Yuppies have found a way to ruin even that.

I just hope I don't hit one of these sonsofbitches.   It is not hard to do - they swerve right out in front of your car when you try to pass.  What sort of idiot does that?  A Yuppie idiot, that's what.

Wednesday, July 27, 2011

Clickbait Scam

Why do people want you to click on links?  Because they make money!



A comment appears in my inbox today:

Please for Christ sake please help me
I need your help and support to help PAY MY Tuition Fees. I need your only 3 to 5 minutes approximately

What you have to do is
1.go to Google.com and search "*******************"
2.then visit my blog from the the search results.
3.Remain on the page i.e **** for one minute or so and do some random surfing
4. click ONE of the ads that appeals to you from AdChoices and visit there.
5.remain on that page for one minute or so and do some random surfing.
and that's it.

NOTE: Only ONE click is needed.
I will be grateful to you.
May God Bless You.


What is up with this?   It appears to be a clickbait scam, which is becoming more and more popular on the Internet.  A lot of websites, blogsites, and other sites out there are nothing more than SEO (Search Engine Optimized) Clickbait.  How does this work?  And why?

Well, to begin with, Internet advertisers are dumb enough to pay "click revenue".  If you go to a site and see an ad, the owner of the site might get some revenue from that.  But, if they CLICK on an ad, they get even more revenue.   And if they BUY from the ad, they might get even more.

In theory, it makes sense, as you are selling eyeballs, one pair at a time, to advertisers.  No Nielsen funny-stuff, where they project "ratings" based on what some fat chick in the trailer park watches all day on her Nielsen-equipped TeeVee.  Rather, you pay for each view.

Granted, the amount paid is not much - fractions of a cent at most.   But if you can get thousands and thousands of people to look at your blog and click on a link, well, it could result in some revenue for you.

Of course, the links are often for odious deals.  What am I saying?   This is the Internet!  Nearly all ads on the Internet are for odious deals.  And that is one reason I DO NOT MONETIZE THIS BLOG - as the sidebar ads that would appear (based on key-word context) would be for the very agencies that I am decrying.

Is the guy posting the comment doing anything illegal? Well, he might be violating the ToS of AdChoices, but I have no sympathy for Internet Advertisers.  And he is SPAMMING my comments section, as well as that of others (a search of the text of the above message finds identical copies in hundreds of blogs).

And, he really should get a job.

More and more today, we are seeing these types of "Content Farms" that are generated by people, often from overseas, that are designed to get clicks from Google or other sites.   For example, I search for a review of a particular brand of automobile and I get a hit on Google from a site called "AutosNow!" or some such B.S.   The "article" is written in pidgin English, clearly by someone from India or Africa (e.g., "the feature of this cars are most amazing!") and the article contains little real data.

Other sites are just conglomeration of words and text and garbage - with lots of sidebar ads.  And still other sites, well, they've copied MY CONTENT from this blog and re-pasted it with some sidebar ads.

What's the harm in all this?   Well, to begin with, most of this "content" has no content, so it wastes your time when you are searching for real, hard data.   Hopefully, Google and other search engines will realize they are being played for a patsy and filter out garbage content sites.

And hopefully, internet advertisers will realize that the clicks they are paying for are garbage clicks - views by people who are not viewing at all.

But the whole thing underscores one fundamental truth:  NEVER, EVER, under ANY CIRCUMSTANCES, click on an Internet Ad.   They are never good bargains, and usually are for rip-offs, raw deals, or scams.  And the same is true for "paid hits" on Google or other search engines.

Do your research independently and contact sites independently.   People who use saturation advertisements on the Internet are never going to give you a "good deal" or even "one trick to the tiny belly".

But then again, you already knew that, I hope.

The Big Lie

It turns out that you don't need to create a repressive totalitarian regime to enslave millions.  The secret is to put a little bling on the hand-cuffs - and people will line up to wear them!

When I was a young man, like most young men, I wanted to be wealthy.  Not super-rich, but just to have the toys that it seemed everyone else had, and to have money and control over my own life.  When you are a kid, you have bubkis in the way of cash, and that sucks.  Money, it seemed, was something that other people had, not me.  And earning money never seemed to allow me to get ahead.

As I noted in My First Job, I had a paper route when I was 13.  It was very hard work and not a lot of pay.   But then again, in retrospect, my personal overhead was zero - all of my needs, in terms of food, clothing, housing, utilities, and education, were paid-for by my parents.  Even if I made only a paltry $10-25 a week, I could easily have saved up $500 a year or more, and this in an era where a good used car could be had for that price.

But for some reason, I was unable to save any money.  Like with most consumers in America, I ended up living "paycheck to paycheck" even at age 13, with the money coming in on Friday and being long gone by Monday.   Where did it all go?

Well, back then, the drinking age was 18, and by age 15, I was being admitted to bars.  And my Brother, who had no money, was willing to take me along with his friends, if I would buy the pitchers of beer (which were a dollar apiece during happy hour).  And of course gas was 50 cents a gallon, and we needed that.  And pot of course, which was $20 an ounce.  A $25 paycheck from the paper route went away rather quickly.

But of course, even without recreational drugs and the like, there were other things I spend money on - record albums, toys, snack foods, and the like.   The money just....went away.  I was never able to save up for a nice stereo, or  a nice car, or whatever.  And yet I had the money.  What happened?

What happened was a foreshadowing of the next 20 years of my life - and what is day-to-day living for most Americans.  We enslave ourselves to the powers-that-be in exchange for crap.  And when we can't afford to pay cash for crap, we finance it on time, making it that much more expensive to own.  Before long, we are surrounded by manufactured goods, subscribed to a dozen monthly subscription services and expenses, and sit there wondering "where did all the money go?"

And at each stage in my life, I thought that "this time for sure" I would end up making a lot of money and be rich.   When I left the job as paperboy and went to work at the 1890's Been 'n Reef Restaurant (more on that in another posting), I thought for sure that $4 an hour was going to be the bomb, in terms of a payday.  Now I would be making hundreds of dollars!  But it never worked out quite that way. 

Just as a goldfish grows to the size of a fish bowl, or gas expands to fill a volume, my spending increased in proportion to my income.  And most of my spending was on small, crappy things, rather than on big-ticket items, as I never had a lot of cash at one time (because I squandered it all on small, crappy things).

And so on down the line.   When I went to GM, I thought that now was the "big time" and same at Carrier - after all, I was making the staggering sum of $15,000 a year!  But as each raise came along, so did an increase in spending.  It was hard to toe the line and keep spending down to a minimum.  There is something in human nature, I'm afraid, that makes it very hard to say "let's do without and save instead!"

And, unfortunately, this lack of willpower is prevalent among most of us.  We are tempted by the new-car showroom and E-Z monthly finance terms.   We want shiny new things and electronic gadgets.   We seek status, whether it is in our clothes, cars, cell phones, or even tattoos and body piercings.

Somewhere along the way I woke up and realized that my life was slipping away, one $10 designer coffee drink at a time.  Each new expense and new toy seemed affordable and a trivial amount by itself.  But cumulatively, it was all starting to add up.   I was making, by then, the fabled six-figure salary, and still wondering why I wasn't getting ahead in life.

At this point, many folks throw up their hands and blame the government or the "Wall-Street Fat Cats" for their woes, depending on their extreme political leanings - Left or Right.  But for middle-class people, their problems are often parked in their driveway, or dead center in the living-room.   Onerous new car loan or lease payments and countless hours programming your brain by watching TeeVee are to blame - not anyone else.

Suddenly, it seemed that we "needed" things we never thought of before.  The TeeVee shows a fancy bathroom, and we have to have one.  The TeeVee shows a fancy kitchen, and we have to have one.   The TeeVee shows a new leased "luxury SUV" and we all go out and get one.  The TeeVee shows a "smart phone" with texting, and we run off, like lemmings, to the store to wait in line, feeling lucky to be able to hand over our money in exchange for a little electronic box that for some reason, we did without for so long.

So the answer, to me, became clear.  Stop listening to the Big Lie.   Stop being a "consumer" and instead start being an Investor - in every aspect of your life.  Think carefully about the real economics of each transaction in your life - not coupons or rebates or other distractions.    And certainly this means not thinking in terms of "monthly payment".

It was not easy to do - it meant re-thinking everything I had been taught by the TeeVee since age 5.  It meant rethinking everything I had learned from my parents, co-workers, peers, siblings, friends - our entire society.

And many of these folks say (and still  say) that I am "crazy" for not obsessing about the "Tot Mom" trial or who is voted off "Dancing on the Stars Lost Island Survivor Idol" whatever.  After all, "everyone" watches this crap, right?

And everyone said I was "crazy" to invest in Real Estate - after all, prices were so depressed in the 1990's!  And everyone said I was "crazy" to sell it in the 2000's - after all prices are high!  Why sell?  (Gee, I dunno, the old "buy low, sell high" deal?  The real way to make money?).

I attended a nice breakfast meeting with Raymond James people.  Thanks for the breakfast, but I am not sure I will be investing anytime soon, however, with them.  But one chart they showed was interesting.  It showed rates of returns for mutual funds, institutional investors, and individual stock-pickers.  Guess which was the lowest?  Yea, chumps like you and me who try to "beat the market" by buying high and selling low.  We churn our own investments, out of fear and greed, and end up getting 1-2% return on our money, over time, if we are lucky.

And why is this?  Because most people get their investment advice from the shouting guy on the TeeVee, who says "BUY" and "SELL" as if the act of buying and selling stocks makes money in and of itself.  It plays to the Casino mentality of the market - which is all the financial channels and pages tout and sell - because when you play at the Casino, people make money - people other than yourself.

It is all part of the Big Lie - and it is a Lie that we all want to believe, as it involved lazy, weak thinking.  The idea that we can get something-for-nothing or win big at the lottery.  But it never quite pans out.

So, how do you avoid the Big Lie?  This is where it gets very, very difficult.  A lot of people read this blog, looking for Hints from Heloise - how to recycle pocket lint and make a nice sweater.  Most of that sort of thing is just faux financial acumen.  Although it is true that vinegar is a great glass cleaner and cheap to boot.  But that sort of thing only scratches the surface.   Saving a dollar here and a dollar there is good - if you apply this to your whole life. 

But if you rope-off certain areas of your life as "untouchable" financially (much as our government has done), then nothing will come of your efforts.   And for many people, this list of "untouchables" is very long - the cable bill, the cell phone bill, the car payment or lease payment, etc., etc., etc.    They have a laundry list of "must have" items which cannot be touched.  But most of them are not only NOT "must have" items but are things are you better off without.

Not watching TeeVee is essential - not optional.   And most people can't put their arms around this.  How can I live without "Dancing on the Stars?" they whine.  And yet, the moment you stop beating yourself over the head with this sort of nonsense, you can start to slow down and think for a change.

Obsessive cell-phoning and texting is another.   "I can't give this up, it is how I communicate!"  But often LESS communication is better than more, particularly when the signal-to-noise ratio in a phone call or text message is high.   Again, this obsessive behavior is just a means of drowning out the silence in your brain and pretending you are doing something "important" when in fact, you are doing nothing at all.   It is Computer Solitaire for the brain.

In short, you can't claim to be against Big Brother and still go to the rallies and engage in the two-minute hates.  It is a package deal - all or nothing.

And this is why I say that financial acumen is not to be found in clipping coupons and watching yet MORE TELEVISION looking for normative cues.  You have to unplug entirely from that.    Once you get your head in the right place, the rest will follow, as day follows night.

But until you do that, you are just spinning your wheels, I'm afraid.  The ability to get ahead in life is available to anyone.  But it requires that you reject 99% of the thinking of your culture, society and friends.  And most people can't do that, which is why they don't get ahead.

Monday, July 25, 2011

Is Social Security a Wealth Transfer Scheme? No.





Is Social Security a Wealth-Transfer Scheme?  Not really, as the amount you get out of it is proportional to the amount you PAY INTO it.  With welfare or unemployment or other ''entitlement'' programs, you receive money that other people paid in, and you do not pay in, yourself.  And the amount you get out of welfare is not dependent on how much you paid in taxes.  That is the basic difference between Social Security and a ''Wealth Transfer Scheme''.



A reader writes, concerning my posting on Social Security:


All well and good except ss isn't funded like a pension or 401k. Ss just takes money from workers and transfers it to retirees, while ignoring the economic impossibility of sustaining the scheme for future retirees. Not to mention the immorality of all wealth transfer schemes, including ss.

You are correct that there is no "trust fund" as many people believe.  Ironically, many right-wing "teabaggers" are the first to believe this!

One conservative congressman recently elected recounted how, at one town hall meeting, a right-wing voter told him that he believed his Social Security number was the number on a bank account set up in his own name, and that there was money invested in this account that belonged to him.   "Cut government waste!" the voter said, "but don't touch my Social Security!"

"That is the mentality I have to deal with" the Congressman said.

The reality is, as I have noted before, that the moment your SS money goes into the "trust fund" it stays there for less than a nanosecond before being replaced by an IOU from Uncle Sam.   This money then joins the general funds which pay all the bills, including that of people presently collecting Social Security.

A better way to look a the Social Security "withholding" is as a TAX plain and simple.  The money doesn't pay you, so much as it pays current retirees.  And when you and I retire, younger people will pay us.

WHOOPS!  That old age pyramid problem again.  And the problem is, it ain't a pyramid anymore, but looks more like a minaret.  My generation (1960) is the widest part of the pyramid, and succeeding generations are smaller.  Gee, if we only let more immigrants in, that might help.  But no, we have to chose this point in time to be xenophobic, right?

Our population continues to increase, only because people are living longer, not because succeeding generations are larger.

And therein is the problem.  The age pyramid will continue to get top-heavy with older people - looking more like an age cylinder than pyramid.  Before long, like GM of two years ago, there will be 2 retirees for every 1 working person.  And all that Social Security money that the Government "borrowed" and replaced with IOU's will have to be paid back - with interest.

What then?  Good Question.  People with lots of money won't "need" Social Security, right?  So we'll take it away from them, further rewarding those who chose not to save and punishing those who did.  OK, NOW you've turned Social Security into a "wealth transfer scheme".  That "answer" isn't an answer at all, but just turns Social Security into a welfare plan.

But what is the alternative?  Let old people starve?  What?  We've made a promise to people over the last 50 years that they will be paid X dollars at age 63 (and we now print this out every year!).  We are going to go back on this promise?  A lot of people, myself included, made our retirement plans based on those stupid annual reports from the Treasury Department.

The point of my calculation is that the money paid in by a person is about equal to the money paid out, plus a modest amount of interest - in fact, a very advantageous interest rate for the government.

If we put a "needs test" on Social Security then it REALLY devolves into a wealth transfer scheme - giving money away not based on contribution, but based on other criteria.

From what I can see of my calculations, the often-touted statistic that most retirees get far more out than they put in, is suspect.  They get out what they put in, plus the interest rate on a passbook savings account.

Perhaps that is an argument for privatization of Social Security, perhaps not.  If we were to do that, however, the "safety net" would have to be a very, very safe investment.  Like, for example, Government Bonds.

Which pay about 2%.

Whoops!  Back where we started.

You see, your SS money is basically being "loaned" to the government at government bond rates.  You do get it back, plus interest.  So in one aspect, it is not a "wealth transfer scheme" but a time transfer scheme - with your money being paid back to you, over time, on other order of crappy-interest-rate government bonds - presuming you live so long, of course.

Social Security is sustainable, provided more money is put in than taken out.   And right now, if you make more than $108,000 a year, you pay no tax on the amount higher than that.  It is a REGRESSIVE tax (a tax on the poor more than the rich)  Every time there is a "crises" on Social Security, the simple way to "fix" it is to raise that cutoff rate.

So, I disagree that it is "immoral" as if you pay INTO it, you always get money OUT of it, provided you live long enough to retire.  That is no more immoral than an annuity, which pays out nothing if you die young.

Of course, some people who get "disability" (legitimately or not) do get far more out than they pay in, and in their case, it is a wealth-transfer system.  We need to tighten up qualifications on this, as I know people who are collecting who should not be - the carpal-tunnel sufferer (this is a full disability) who just returned from a canoe trip, for example.

And I disagree that the system is in crises or unsustainable.  If we can borrow money from the Chinese at 4% we certainly can borrow money from our own citizens at 2%.

And eventually, even the baby boomers die off and stop collecting...

And if we can grow the bottom of that pyramid again, there will be enough people to support the top.   And the good news is, our generation (the baby boomers) will all kick off due to obesity or drug-related illnesses.  They likely won't live as long as the "Greatest (and most modest) Generation Ever".

And if that doesn't work out, there is always Soylent Green...

It's made of people, dammit!

The Gay-Nazi Connection, Part Deux

SWM, lives with Mom, no girlfriend, Blond Hair, Blue eyes, Uniform Fetish, seeks same for fun times.


OK, some people have been hinting at it, but I'll come right out and say it.   The jerk pictured above is a closeted homosexual.  And I hope he reads this and gets all infuriated.  But he knows deep down it is true - every night he beats off in jail and thinks about men in uniforms with shiny leather boots.

And speaking of jail, he has 21 years to look forward to of gay prison sex.  Sometimes I wonder if most criminals aren't in fact closet cases, and use criminality as an excuse to spend time in what amounts to an all-expenses-paid gay sex club.  Sure, they all say they do it in prison because "they have no other choice".  But it is funny, as homosexuality has become more acceptable in society, the crime rate has actually dropped - except among social groups where homosexuality is taboo.  This might explain why there are more African Americans (Baptists) in jail as well as Italian-Americans (Catholics) in the mob.

Scratch a fundamentalist (Christian, Jew, Islamic) or a right-wing nut-job and you get a closet case - every single time.  They resort to extreme religious beliefs as a "cover" and hopefully a cure for their own sexual identity crises.  And funny thing, too, oftentimes, these "religious" nuts are not formally affiliated with any real church.  Our pal above had no formal church affiliation - but claimed to be a Christian Fundamentalist.  Go figure.

And as I noted in the Gay Nazi Conundrum, history bears me out.  The history of right-wing and neofacist movements is marked by the outing of closeted gay men - the "wide stance" wing of the Republican Party, for example.  Some of the best Nazis were Gay - until they faced a firing squad or a death camp, of course.  The hysterical anti-communist movement of the 1950's was chock full of closet Queers - looking for a commie in every closet, so no one would look in theirs.

The fellow shown above just looks gay, frankly.  His photo looks like a head shot from any one of a number of online sex sites. Sorry, but straight men just don't look like that.  Too....metrosexual.  The bad hair gives it away that he is a closet case, of course.

And of course, no girlfriend - he's "waiting for the right one to come along."  Well, other than his dear old Mom, with whom he lived.  Oh, yea, he had a "farm", but also two apartments where he and his Mother lived and where he spent a lot of time (you can see why he was so upset at the Islamics - he only had a farm and two apartments - talk about economic repression!).

So, a loner, stay-at-home kind of guy who is overly attached to his Mother and spends a lot of time on right-wing political and religious theories - this is a no-brainer to me.   Closet case, period.

But this is not an attack on closet cases, but merely the sort of political thought that tries to shame or criminalize homosexuality.  The religious right wants to paint gays as evil and bad.   The political right would just assume outlaw it (while retaining their own closeted perks).  What this serves to do to people is make them schizophrenic.

And I think this is another reason a lot of young people "go off the rails" in their teen years and early 20's.   Their sexual urges and feelings are in conflict with their religious upbringing, the expectations of their parents, and of course, the "viper pit" that is high school (where even today, kids are bullied, beaten, and abused for being gay).

So, what does a young man do?  Turn to extreme politics or religion as both cover and salvation.  If only the world could be completely re-made, everything will be perfect!  But of course, the world is never completely re-made.  And of course, it turns out that the Nazi leader is caught in bed with boys, or the famous communist hunter dies of AIDS, or the Republican "family values" Senator is arrested in a public restroom or the right-wing congressman is arrested for soliciting a male prostitute.

Think about it sometime.  Why are there no women at Klan meetings?  Why does a meeting of Aryan Nations look a lot like Bearapalooza at Roy's Hideaway?   Heck, they even wear similar uniforms!

And yea, the two guys who bombed Oklahoma City were probably also closet cases, too.

What does this have to do with personal finances?  Simple.   It is far easier to come to grips with your sexual urges and just accept them, than to go insane and spend all your free time on right-wing websites or giving all your money to hateful religions.   There is no personal profit in obsessing about politics, whatsoever.

Just come out of the closet, already.  Sheesh!


UPDATE:  July 29, 2011

My suspicions are apparently true.   Not a ladies man and seen dancing at a Gay Pride Festival - but later renouncing that.  It sounds to me like he had a lot of "issues" with his sexuality.  While the photo is discussed online, I have yet to see it produced anywhere.

Sorry, but here's the 411 on being a Straight Man, for those of you in the closet, trying to "pass":

 
1.  Don't obsess about your appearance.   Straight guys don't give a damn.

2.  Plastic surgery is out, period, unless you were deformed in a bike accident or the war.

3.  No makeup.   Ever, ever, ever!

4.  Getting professional "head shot photos"? - Uh, No.

5.  Hair Salon?  No.  Never.  Real men go to Barber shops.

6.  Dancing at the Gay Pride Festival?  Only with your girlfriend, if you think it will make her think you are progressive and you will get laid as a result.  Even then, this is suspect.

7.  Working out in the Gym:  This can be tricky.   The guys who end up admiring themselves in the mirror a lot end up, well, falling in love with their own bodies and then looking for the same as a lover.  Obsessing about the gym is problematic.  Real men, of course, work in construction or other manly pursuits (e.g., Lumberjack) and don't need no sissy gym to become "ripped".

Remember:  It is a thin line between Charles Nelson Reilly and Rock Hudson.   If you are going to make this work, you have to pay attention!

This idiot from Norway failed at every level.  His profile screams "closet case" 100%.  It is very sad that someone can't just come to grips with who they are.   But I've seen this a lot - men who obsess about religion or politics as a means of "covering up" or distracting themselves from their own internal demons.  It never ends well.  In fact, it often ends badly.

Of course, real Straight men (if they indeed exist) rarely obsess about their sexuality, either.  Which is the 100% sure way to know if someone is straight or not.....



"There is no Dark Man" -- Quentin Crisp.

Shift From a Consumer-Based Economy to an Investment-Based Economy.

Consumer Spending is way down.   Consumption be done about it?

In the New York Times Sunday opinion section the other day, they gave alarming statistics on consumption in America - it is way down, despite a slow recovery in the economy.  Car sales are down, appliance sales are down, and of course, home sales are down.  What is going on?

What is going on is a shift in demographics, and also the death of the consumer-based economy.  The latter is self-explanatory.   In the 1990's and 2000's, we were told that "consumer confidence" was the most important thing in the world, as our economy was based on consumption.  Consumption was your patriotic duty, and the more you consumed, the better off we all were.

But consumption, by definition, is just using things up.   We cannot become a richer country just by buying more Cadillacs.  And you cannot become personally wealthier by consuming more.  This seems axiomatic, but many people - stupid people and weak thinkers - still believe this today.  You cannot sustain an economy on borrowed money, both on a personal and governmental level, and a massive trade deficit.  Somewhere along the line, you have to produce as much as you consume.  And we weren't doing that.

And people consumed.   Rip out that functional kitchen and put in a showplace with stainless steel appliances and granite counter-tops!  Finance it all with a home-equity loan that won't be paid off until the appliances are long in the junkyard!  Never mind the cost, your home is going up in value!  And these "improvements" will make it worth even more!

All lies, in retrospect.  Spend a dollar on a kitchen, you get back 50 cents.  And the staggering increase in home prices was not real, and the home equity loans were merely spending phantom equity.  And a lot of people will spend the next DECADE paying all this debt off.

Which brings us to the second factor - demographics.  I harp on this a lot, but it is the major engine of our economy and one that is consistently overlooked.  My generation is "tail gunner charlie" - bringing up the rear of the baby-boom, and the largest part of it (birth date, 1960).  Our generation is facing imminent retirement and some are already being involuntarily retired at age 55.  And we have to rely, in general, on retirement savings, and in general, we have all under-saved for retirement.

So what are we all doing?  Trying to save.   And some are trying to "jump start" their savings by trying to beat the market.   You know how that will all pan out - once their Facebook stock goes bust and the price of gold drops to $800 an ounce.

And I know all this because I am part of this generation, and to some extent, I did some of the same stupid things - over-consumed and under-saved - but did it less than most.  But at this stage in my life, I am not keen to spend $30,000 to $50,000 on a new luxury SUV or a boat, or an airplane or a vacation condo, or anything that costs me money, basically.  I would rather go on vacation - I can spend the money if I have it, but I am not locked into a multi-year commitment of expenditures, depreciation, and maintenance costs.

And I have paid off my debts - which a lot of people are doing or trying to do.  Having a high monthly cash-flow requirement is, in retrospect, a very bad idea.   Being able to live an all-cash lifestyle is a good idea, if you can do it.

So, the idea that the housing market will rebound quickly, or that car sales will zoom up, or that people will jump back on the remodeling buy-and-flip bandwagon anytime soon is, well, specious.  Recovery is not "just around the corner" because the old model of Consumption is dead, I think.  And I think the new model - of investment and productivity - will take a long time to come to fruition.

And compounding this problem is that the government will cut back on spending.   Cutting back on welfare and entitlements would do good.  But we need to spend more on jobs that create wealth - to produce more.  And we need more people to fill in the bottom of the age pyramid.

But we are doing the opposite - discouraging immigration and then paying native-born people not to work, while simultaneously cutting spending that could foster employment.    We could be in for a long drought....

Is the Blackberry Dead? Maybe not yet...

Just a few years ago, tech pundits were ready to write the obituary on the Nintendo Wii.  Its processor wasn't as sophisticated or as fast as the the Playstation or Xbox, and the graphics were not as good.   But it turned out that a cheaper device with a better user interface was the secret to better gaming, not more processing power.   Could the same be true for Blackberry?

Research In Motion is laying off 10% of its workforce in the face of competition from Apple and Google with their iPhones and Androids.

The one thing with tech companies is that you should never write them off just because some pundit said so.   All the pundits say Facebook is the next big thing, but it has yet to make a profit.

All the Pundits said Nintendo was going to go out of business, as the Playstation and the Xbox had better graphics and more powerful processors.  Microsoft loses money on every Xbox sold.

Then the Wii came out a couple of years ago for Christmas, and a funny thing happened.   It turned out the gaming experience wasn't all about processor speed, high-resolution graphics (that the eye can't see anyway) but all about the INTERFACE.  The Wii interface was easier to use and more realistic than the "gaming controllers" of the competitors. 

So with an "inferior" product (technologically), Nintendo outsold the competitors, based in functionality and usefulness, not on raw processing power or technical specifications.

Android and Apple are racing to develop more and more techy features which are nice and all, but other than to tech pundits and a few early adopers, are not all that useful.  And most of these Beta products are clunky and have problems.   "Hold it this way, not that way" - right, Steve?

Sales of "dumb" readers are soaring, as most of us want a simple device to read books - one that it intuitive and easy to use and has a battery life of weeks, not days or hours.  A few of us want iPads to show off how sophisticated we are and to run clunky "apps" that never seem to work just quite right.   But the bulk of us want something simpler.

And yes, a lot of people have smart phones - but not everyone.   In fact, I suspect that "dumb phone" usage still exceeds smart phone usage by 2:1.  No, I can't scan a 2-D bar code on an advertisement with my dumb phone and download a web page.   But here's the deal:  I don't want to, either.  A chance to get marketed to MORE in my life?  Sorry, no thanks.  And I have a GPS in my car, I don't need to pay extra to have one in my phone.  And a $50 used nano works just as well as storing music on my phone.

So there is an opportunity for Blackberry, I think.  If they keep trying to play "catch up" with the high-tech (but largely useless) features of the other smart phone makers, they will get creamed.  But if they offer a simple pad device with a BETTER INTERFACE (and yes, Apple's much-vaunted interface really sucks at times) and can do this at a more attractive price point, they might be onto something.  They could pull off a Nintendo.

But if they try to go head-to-head with Apple and Google, they will get creamed.  The secret to competing with heavyweights like Wal-Mart is not to try to out-Wal-Mart Wal-Mart, but to find a niche that is unfilled and then fill it.

Just a thought.  There are a lot of people like me who won't pay $499 for a phone or a $100 a month for phone service.....

Sunday, July 24, 2011

Viewer Mail - Where to Learn About Finances?




A reader asks:
do you also have suggestions for where one can learn to think about money and analyze financial reports, investments etc. without having to attend university?

Most financial literacy pages assume knowledge of some (perhaps fundamental) concepts and the reader is then left hanging.


Good question.  Company statements and financial statements are impenetrable, even to the expert in the field.   Trying to make sense of a company's quarterly earnings statement or annual report is often an exercise in futility.




But the basics about any company or investment are not hard to fathom - and if someone makes it hard to fathom, well you know why - they are trying to rip you off.  Is a company profitable?  If so, how much?  What is the profit per share in terms of price per share (the inverse of the P/E ratio)?  If you invest $10 in a company, what does it earn in profits, for a year for that $10 - and are you better off buying a CD or something?  Does the company pay dividends back to you, or retain the earnings, like these high tech companies?  Do you feel you are buying something you don't understand?  If so, don't!

I think for the average "small investor" (e.g., working chump like you and me) the key is to use common sense.

1.  Don't fall for the something-for-nothing rigamarole.  It never works.

2.  Don't look for answers with gurus, financial seminars, books, or whatever.  Sooze Orman doesn't have any secrets that you don't already know.

3.  Diversify your investments.  Putting everything in a single mutual fund, IRA, stock, etc., is a bad idea.

4.  Save Consistently over time - put away money.  Most of what you will get out of investing is what you put in.

5.  Stock picking is for chumps.  The idea that you can pick a stock and then watch it take off like a rocket is, well, Hollywood.  And it reduces the market to the Casino.  If you want to gamble, go to a Casino.   But you and I don't have the insider information to "win" at stock picking.  Sometimes we hit it big - but that just encourages the casino mentality.

6.  Ask pointed questions about loads in funds - often your financial adviser won't answer them.  I bought some American Funds and my financial adviser never told me that (a) there was a 5% fee on every investment and (b) he got most of that.

7.  Spend less - it is tempting to lease cars, buy a jet ski, a boat, or a fancy house.  But spending isn't wealth.  Accumulating money is.

8.  Pay down and pay OFF debt.  Paying off debt is the 100% safe investment, and the savings in less interest paid are guaranteed.  Plus, you will have to be debt-free sometime in your life - when you retire.

Those eight basic principles are it, really.  To become rich, you have to accumulate money.  The idea that you can become rich by investing a little in the "right" place is, well, a fantasy sold to us by the financial industry.

All that being said, your local library has a lot of tomes about finances.  But beware - many of them are from Financial Gurus who are touting bad advice or trying to sell you on their program.

They really don't know more than you already do - your gut instincts.

Good Luck!

Thursday, July 21, 2011

Jetson, You're Fired!

Jetson!  You're Fired!

When I was a kid, we used to watch the Jetsons and the Flintstones, which seemed sort of bookends of the past and future, as viewed through the eyes of Hanna-Barbera.  And in every episode of either cartoon, the boss, Mr. Spacely or Mr. Slate would scream, "Flintsone!" (or "Jetson!") "YOU"RE FIRED!"

Being fired back then was a big deal.   It still is today, however, people are generally not fired in an angry tirade by their boss, but rather quietly laid-off, downsized, let go, or otherwise terminated.  Today, firing someone is not something taken lightly, as everyone has all sorts of "rights" and so often, companies wait for a downturn in the economy to cut loose their dead wood.

But why was being fired such a traumatic thing back in 1965?  We lived in a different world then - there were no 401(k) plans or IRAs.   You went to work for a Company, back then, and often expected to stay there for life.   The company provided pay, health insurance, a retirement "pension" and other benefits.  And as such, you remained a toadying, faithful retainer, willing to do whatever the boss said, even if it meant trying to cover up a toxic waste spill in Bhopal, India.

As I noted in an earlier posting, the relationship between employer and employee was a little bit of Corporate Socialism of the era.  You went to work for IBM, Xerox, Honeywell, GM, Ford, Dupont, or Esso, and you expected to stay there for life - provided you kept your head down and did your job.  Shrinking markets and downsizing of companies just wasn't in the cards.

Today, of course, things are different.  Few people expect to make a career at any one job or company.  Most folks expect to be laid off at least a few times in life - or to quit a job for a better prospect.  And companies increasingly are looking at employees as disposable commodities - and have no loyalty to them whatsoever.

Thus, it is not unusual to be laid off from a company at about age 55 or so these days.  As you get older and get paid more and more - and as your health insurance premiums increase more and more - your cost to the company increases dramatically.  Pretty soon, your cost per hour is more than twice that of a younger employee - and they can get more work out of two younger, less experienced employees.  So they lay off you and hire two of them.  And according to the Supreme Court, this is not age discrimination, but in fact, price discrimination -which is perfectly legal.

Keeping your head down and sucking up to the boss is no longer enough, these days.  And that is why, in this global market, you have to plan on unpleasant surprises down the road.   The old days of the company taking care of you from cradle to grave are long gone and you are on your own, now.

And yea, you can argue that it is unfair and all - let me know where that gets you.  Because I doubt the old days of Corporate Socialism are coming back anytime soon.

PLAN on being laid off before you really want to retire.   Put aside money into savings.  Think about making financially independent as a goal, instead of setting a fancy car or jet ski or other consumer item as your goal.  When the shit hits the fan, you will be prepared.

Perfection is the Enemy of the Adequate



Perfection is the Enemy of the Adequate

That quote has been variously attributed to Voltaire, among others (e.g., Larry the Cable Guy, "Ger 'er Done!").  What does this mean?

It means that often, we can set ourselves up for failure by trying to everything perfectly.  Since we set a high standard for perfection, nothing ever gets done.   It is a form of passive-aggressive behavior.  Since something can't be done perfectly, it never gets done at all.

For example, my late Sister told me of a friend who lived in an older home.   They smoked a lot of dope and would talk - for hours - about how they were going to restore the home.  The living room needed a coat of paint.   But rather than mask around the doors and windows - or "cut in" as a professional painter would do, freehand with a brush, the homeowner decided the only "right" way to do it was to carefully remove all the hardwood trim, sand the walls, apply two coats of primer, and then paint.   And of course, the trim would all have to be sanded to bare wood and given several coats of urethane, with wet-sanding between coats.  The trim would then be reassembled and waxed.

This, of course, would be the most anal-retentive paint job imaginable.  And as you might imagine, it was never done.   People like that talk a big game, but never do anything.   Or if they do, they remove the trim, leave it scattered throughout the house, and never finish the project - living in a living room with no trim on the walls.  It is a trick the hoarder does - often disassembling appliances or other parts of the home, scattering the parts to the four winds and then saying they will "get to that someday" when they can get the right parts for it.

In our own lives, we can allow perfection to debilitate us - prevent us from getting our daily work done, or indeed, from every being happy.  Seeking perfection can be a form of mental illness - Obsessive Compulsive Disorder (OCD).  People with this affliction spend countless hours cleaning, arranging, and making their house and lives "perfect" - and never of course, achieving it.  And they are often terribly unhappy people - who often make other people unhappy.

A friend of mine has a buddy who has OCD.  Whenever he starts to flip out, he comes to visit my friend.  I asked him, "isn't he hard to have as a visitor?" and my friend replied, "Yea, but the house is never so clean - that's all he does while he is here!  Clean!  It's great!"

But expecting perfection is a set-up.  Because little in life is indeed perfect, and in fact, there are scientific theories that basically say you can expect things to be chaotic - and entropy to take its toll.  You can strive for perfection in everything - and never achieve it.

A better approach is to triage things to determine what needs to be perfect and what doesn't.  This makes better use of your time and allows you to get things done - the important things perfectly, the less important things less so.

For example, we are building this small house in our backyard.  Modern construction techniques are designed with imperfection in mind.  Many new-home buyers are shocked to discover that their dream home is not "perfect" - but then again, it is not designed to be.  Rough framing is erected and is made as plumb and level as is possible - within the given time constraints.  Due to variations in wood (bends, twists, sizes) and in cuts, no wall is every 100% absolutely plumb.   When windows and doors are installed, they are shimmed to make them level - and the "rough opening" is made larger than necessary to accommodate the variations in construction.

Similarly, when you finish the interior, sheetrock is never cut exactly to size all of the time.  And that is why you end up plastering the joints and seams (and screw holes) and sanding before painting.  Examine closely the walls in your own home.   Chances are, you can see seams and evidence of sheet rock compound, as well as drips and runs in paint.   No house is perfect - all have flaws.

But a house has to be built on a budget - to make a house perfect would be to make it unaffordable.  And somewhere along the line, you have to make a compromise between what is affordable and what is perfect.   And affordable usually wins every time.  Cost drives most Engineering designs - Engineering is not really about "coming up with cool new products!" but mostly about trying to make those products at a price point that people can actually afford to buy at.

We have finished sheetrocking, mudding, and sanding the studio and painted it tonight.   My partner insisted that we put down drop cloths first, to prevent paint from splattering on the concrete floor.   But, he wants to paint the concrete floor as the next step.  So what's the point?  Spending two hours putting down drop cloths and securing them, so they can be pulled up to paint?  You have to reach a point where you say, "It's a studio, paint the damn thing" - otherwise nothing ever gets done.

Many folks cling to perfection for fear of doing something wrong.  And perfection is the enemy of LEARNING as well.  I see this all the time when trying to teach someone how to use a computer.   They are convinced that if they push the wrong button, the thing will explode.  So they have to be "perfect" in every way.   A 10-year-old just pushes every button to see what will happen - and by doing so, learns how to use the computer. 

We see the same thing in school as well - the "cool" kids don't want to be seen as "uncool" by giving a wrong answer.  So they sit in the back of class and snicker at anyone who tries to participate.  But they don't participate themselves, and thus do not learn.  But getting the wrong answers - and making mistakes - is essential to learning.

And essential to inventing.  Many great inventions were the results of accidental discoveries - mistakes - rather than attempts to design a product.  If you never make mistakes, these serendipitous events would never occur.

Of course, this is not to say that being sloppy, disorganized, or doing shoddy work is the answer, either.   When I was at GM, the had a version of this slogan, "Not everything worth doing is worth doing well".  Unfortunately, for a time at least, some folks at GM thought that building a car was something not worth doing well.  And the results were predictable.

Thus, the secret is in the ability to triage your work - figuring out what can be done quickly and easily without sacrificing quality, and what needs to be done carefully and methodically to prevent mistakes from occurring.  This is, of course a hard thing to do.  But if you find yourself trying to do everything perfectly, something isn't right.

Divorce - A Stupid Waste of Money

The divorce rate is staggering in this country - mostly because people are not willing to work through issues and the TeeVee suggests divorce as a panacea to all problems.  But divorce is a staggeringly expensive proposition!

The divorce rate in this country is staggering - half of all marriages end in divorce.  Why is this?  Well, we tend to be very absolutist in this country, and despite the fact we feel we are sexually liberated, we really are a bunch of prudes - or at least the TeeVee is.

For example, take your typical mid-day morning TeeVee chat show -usually aimed at women.  They talk about a cheating husband, and all the women on the panel nod in agreement - if you husband is caught cheating, divorce is the only option!  Or better, yet, cut off his penis and shove it down the garbage disposal.   Gee, that makes sense!

When did women in this country become such hysterical bitches?  I mean, no wonder half the men in this country are Gay.  Can you blame them?  Overseas, people are a little more relaxed.   Your rich husband has a mistress - big deal.  You get all the money, and as a bonus, you don't have to do the dirty deed with his nasty old wanger.  And if you have needs, there is always Alfonso, the pool boy.  What's not to like?

For some reason, though, in this country, our "Liberated Women" look upon sex as an absolutist thing, and if they decide not to have sex any more (for example, after entering menopause), well then, their husband has to "do without" as well.  And when they find him banging his Secretary in a Motel room, well, call the divorce lawyer!

Ladies, if I may interject here - that is really a crummy idea.  Why?  For several reasons:
1.  You will likely be far poorer after a divorce than before.   While you struggle with bills and raising children, your ex-husband will be tooling around in his new Corvette with some Bimbo on his arm.

2.  You let the Bimbo win.  When you divorce your husband over infidelity issues, you force him into a corner.  The bimbo he was poking now will pressure him to marry HER, and that means she gets all his attention, and more importantly, money.  You are left out in the cold.   Don't let the Bimbo win!

3.  You are confusing sex with love and commitment.  Most men have sexual urges that need to be satisfied at least once a day.   If you are no longer interested in sex, or not interested as much, then let him jerk off in the shower or something.  Most wives find this repugnant, and find excuses to interrupt their husbands while they are showering and then castigating them for being "gross".  A more sure-fire recipe for sending him off to the nearest waiting Bimbo, I do not know.  You husband may have urges, but he still loves you and loves his family.  The sexual relationship he may have with another is only a transitory thing - unless you drop the "D" bomb on him and force it to be a permanent one.

4. Your Marriage May be Stronger than Before.  If you keep hubby around, seek counseling and try to save the marriage, it may be stronger than before - and you may find yourself having more power in the relationship as a bonus - not that it would be a good idea to browbeat him about his affair all the time (lest he dump YOU as a result).
Of course, women are wired differently than men - they view sex as love and confuse the two.  They find out their husband is banging the maid and assume he is in love with Consuela.  But that is not the case - he is in lust with her, and probably will dump her in short order.

The Bill Clinton / Monica Lewinsky affair is a case in point.  Bill Clinton had no intention of divorcing Hillary and making Monica the new first lady.   No, he just wanted a little fun time, and frankly, as President of the United States, you don't get a lot of that, particularly when your wife is a proto-Lesbian.

And a lot of people thought that Bill Clinton having a little nooky was shocking - again we are prudes in this country - but to me, that is an issue between Bill and Hillary - and I suspect that Hillary came to grips with her husband's infidelity a long time ago.  And Hillary is no dummy - she realized that a messy divorce would not benefit either of them.

Before you decide to dump your husband, consider marriage counseling.  Making absolutist statements, like they do on The View  - such as "If I ever caught my husband cheating, I'd divorce him in a minute!" is just stupid.   Because you are just setting yourself up for a fall.   Odds are, he'll do it, and then where does that leave you?  Perhaps emotionally vindicated but economically devastated.

The marriage vows you took were "For better or worse....till death do us part" - there was nothing in there with a bail-our clause if he pokes a Bimbo.   That, I'm afraid, is a modern invention, and again, one fostered and festered by the good old TeeVee - the source of all poor normative cues.  Just turn that shit off - watching daytime talk shows is just going to rot your brain, anyway.

And that is what "For Better or Worse..." meant, by the way.   It didn't mean like "sometimes it rains, or there is nothing good on TV to watch".  It means really bad shit happening.   You stick with it and don't bail out - or make ultimatums.

But of course, in today's instant-gratification world, everyone wants a bail-out clause.

Why is divorce so expensive?  Well, in addition to Attorney's fees and the like, you now have to maintain two separate residences.  That gets very, very expensive.  It is like owning a vacation home, only without the fun vacation.   For women, this generally means the short end of the stick, as women still do not make as much money as men in this world (act shocked) but still have to maintain the family home (which starts to fall apart rather quickly) and raise the children.  And today's "equitable" world, things like alimony rarely exist - we divide everything even-Steven, if you are lucky.  In some cases, the man walks away with more.

But what about child support?  What about it?  Despite onerous laws that say you can have your husband jailed or his license revoked, there are a lot of "deadbeat Dads" out there.  Some literally cannot afford to pay it - others chose not to, after being tossed out of a marriage. Regardless of the reason, the net result is you end up poorer - far poorer - that you were before.

And of course, the effect on your children is predictable.   Despite the acceptance of divorce in this country and the idea of having two Dads and two Moms, most kids would, if you could ask them, prefer to remain in a nuclear family.  The Christian Right may not be right about much, but preserving the family is a good idea - although most of these born-again types are usually divorced-again as well.  Maybe they need to save Straight marriage before going after Gay ones.


* * * 

This is not to suggest that divorce is never a good idea, only that today, it is used at the drop of a hat. Women in particular like to say things like, "If you so ever even look at another woman, I'm leaving you!" which is an interesting sort of threat and not exactly unconditional love - and explains why husbands "sneak around" behind their wives backs, instead of talking about sex openly and truthfully.   A relationship where one spouse has one hand on the ripcord at all times - ready to bail on a moment's notice, is hardly a relationship at all.

Of course, if your husband beats you, leave him.  If he is a drunk or a drug addict, leave him.  If he squanders money, leave him.  Why?  Because economically, you are probably better off terminating the marriage.

For example, a friend of mine married a man who was constantly underemployed and unemployed.   He drank heavily and after work every day (when he did work) he would go to the bar, buy rounds of drinks for everyone, and then show up at home at 9 or 10 at night, drunk.   If it was payday, he would cash his paycheck at the bar and bring home a pittance of money - hardly enough to buy groceries for the next day, much less the next week.  After he got multiple DUIs, she finally put her foot down.

Or, as I noted before, another friend whose husband decided to start up a crack habit - and spend the mortgage money on crack.  She left him, but not before he ruined her credit rating and took out loans in her name.

And in many marriages, one or both spouses refuse to save or even manage their money, but instead spend every last nickel on a new jet ski or deer stand or whatever, and bounce checks all the time.  Such a relationship is an economic nightmare, as one spouse stays at home trying to scrimp and save to get by and support the family, while the other is out having a good time.

Such scenarios illustrate how a marriage is indeed an economic proposition in addition to an emotional one.  If your marriage problems are emotional and not economic, then think carefully before entering the expensive proposition of divorce.   Marital counseling is cheap - perhaps even free at your local church.  Thinking emotionally is rarely a good idea.  And you don't want to turn into one of those bitter old people who rattle on about how their "Ex" is an asshole.

And divorce is very hard on children as well.  The kids are shuttled over to "Weekend Dad's House" to spend the night with Dad and his new girlfriend (and they can hear them having sex through the paper-thin walls, Eeeeeew!")  Worse yet, they return Monday to Mom's house, where her new live-in boyfriend is now hanging out.  Is this really a better arrangement?  Tossing your husband out of the house and then getting a boyfriend seems like an odd solution to marital infidelity.

Of course, in many cultures in the world today, the idea of multiple wives (polygamy) is well accepted.   And in fact, in our own Judeo-Christian heritage, multiple wives were quite the norm.  Monogamy is a relatively recent invention, probably paralleling the spread of venereal diseases in the last few centuries.  Today, we cringe at the thought of polygamy - and ostracize Mormons for even suggesting such a thing.  But really, a marriage is a private affair, and I am not certain why the Government needs to regulate it at all.  But once again, I digress.

In the United States, in the last two decades or so, women have become increasingly strident about dumping their husbands when they go astray.  Women's talk shows in particular, I think are to blame for this trend - in fact, these sorts of shows do little but castigate men in general ("He leaves the seat up!") and then wonder why "there are no good men out there."  This is not Women's Liberation - it is bullshit.   In fact, you might argue (successfully) that it is very retrograde - that it posits that women are these emotionally helpless beings and that "men are no damn good" and should be hauled out to the curb with the trash at a moment's notice.  Once again, the TeeVee provides horribly bad normative cues.

But for some reason, women are drawn to this sort of nonsense - like flies.  And in some regard, I think a lot of women get a sense of schadenfreude out of this - secretly delighting in seeing someone else's marriage fail.  In the link above, the only coherent response in the thread was, "She should talk to her minister, as we probably would give wrong advice here".  The rest of the women responding were quick to announce "the end of another marriage" (besides their own, of course).

Women are incredibly cruel to one another, and taking relationship advice from your "Girlfriends" is probably a very, very bad idea.  Before you go to your BFF to cry on her shoulder, perhaps you should think twice - a neutral third party, such as a marriage counselor, is probably a better idea.  Your divorced friend only wants to see someone else reduced to their level of misery - and misery loves company.

Whatever it is you decide to do, just remember one thing:  If you divorce your husband because he had an affair, it was YOU, not him, that "broke up the marriage".