Category: Purpose

Creative Destruction and the Fight For Your Eyes

“You know what it is?  You’re always attracted to someone who doesn’t want you, right?  Well, here you have somebody who not only doesn’t want you, doesn’t even acknowledge your right to exist, wants your destruction! That’s a turn-on.” – Curb Your Enthusiasm

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Behold, the chainsaw of Creative Destruction. This one will take care of those pesky optometrists!

There were vast periods of human history where . . . absolutely nothing happened.  If they had a newspaper, it would be blank for decades at a time.  Our Neanderthal (many of us) and other cave-dwelling hominids (all of us) ancestors lived for tens of thousands of years with little or no innovation, and that innovation that did show up was not all that exciting.  My bet is that most of them were fairly stupid, and it took generations of stupid people not having kids until humans were smart enough (and eloquent enough) to make an attempt at civilization.

Even with that first civilization, things changed only very slowly.  A thousand years of Egyptian dynasties (the pharaohs ruled Egypt for three thousand years) could pass and no one invented Cool Whip®.  You an Egyptian forward in time a thousand years and the only thing that had changed was that the music the kids listened to these days was too loud and just plain awful.  To put how very stagnant these civilizations were in perspective:  Jesus is closer in time to the people living today than He was to the time of the construction of the pyramids.  This statement will be true for another FIVE HUNDRED YEARS.

The Egyptian empire lasted a really long time, and since nothing changed, like a televised baseball game, it seemed even longer.  But then?  The Romans began to change the world, with a much shorter period of dominance.  And things keep changing faster, and faster.  More perspective:  an 85 year old has lived through 37% of the history of the United States.  An Egyptian 85 year old would have lived through less than 3% of the total length of the 3000+ year span of the pharaohs.

But scientific progress undid the pharaohs in what economist Joseph Schumpeter would call “Creative Destruction.”  Schumpeter originally derived Creative Destruction from his readings of Marx (Karl, not Groucho).  Creative Destruction is predicated on technological innovation coupled with entrepreneurial spirit in an effort to make money by disrupting previous economic structures and replacing them with new, more efficient structures.  An example:  Live performers were replaced by records.  That were (briefly) replaced by 8-Tracks.  That were replaced by cassettes.  That were replaced by compact discs.  That were replaced by .mp3 files.  That were replaced by . . . streaming music.  Each innovation replaced and (mostly) eradicated the previous iteration, making music more easily and reliably available.  Unless you have our mobile phone service:  streaming doesn’t work so well, since our wireless phone provider uses a series of wire coat hangers where we live to broadcast signal.

On Friday (LINK) I wrote about the coming Optopocalypse™.  This is another example of Creative Destruction in action.  Records destroyed local bands – you could hear better at home anytime than the local talent.  mp3’s destroyed record companies.  And 75%+ of optometrists will be looking for work soon enough because technology will have made most of what they do irrelevant.  And, outside of their families, the “Destruction” part of Creative Destruction results in greater value to all of society – more people will be able to see, since there’s hardly anyone that won’t be able to afford the low cost of the EyeQue®.

Another example is Zenni Optical (LINK).  I got great glasses from them (via my new prescription from EyeQue™).  I was testing out that prescription, and wanted to get some glasses.  I put my order in, and was even allowed to pay via Amazon, so they didn’t get credit card information.  I ordered my glasses on a Thursday, and got them the following Saturday (nine days later).  They were perfect in every way!  I then put in a new order for three more pairs.  Total cost, including express shipping?  About $200 for the three pairs, with the best lenses they offered, plus extra slip on sunglass attachments (and bifocals).

I ordered them on Saturday, and tracked progress.  By Sunday they were complete.

Here’s the shipping:

Origin Scan
CN
10/25/2017 9:49 P.M.
Order Processed: Ready for UPS

Shanghai, CN
10/25/2017 11:16 P.M.
Departure Scan
Arrival Scan

Anchorage, AK, US
10/25/2017 3:26 P.M.
Brokerage released the package. It will be processed through a clearing agency before final release to UPS.

Anchorage, AK, US
10/25/2017 4:46 P.M.

Departure Scan
10/26/2017 2:54 A.M.

Arrival Scan
Louisville, KY, US
10/26/2017 5:32 A.M.
Departure Scan

10/26/2017 5:51 A.M.

The glasses hit my hands about 2pm that day.  And, just like the first order, they were perfect.

If you look, it appears the package goes back in time a bit, but remember about the whole date-line thing.  Regardless, I’ll go with the story that my glasses came from the future.

Well, they did come from China.  Express, for $18.

This is certainly a great way to add value, and it (by definition) changes the price that many people will pay for glasses.  It’s Creative Destruction on a grand scale – Zenni will make billions.  But it cuts off another revenue stream that will add to the Optopocalypse™.  If you look online, optometrists are out in droves complaining about both EyeQue™ and Zenni®, some of which take the form of reviews that I think are less than honest.

And the optometrists are also fighting by trying to make innovation illegal – at least innovation that hurts their profit margin and their monopoly over information about your eyes.  They typically will call the bill a “patient protection act” or something similar, so it makes it sound like it’s really for the benefit of the patient.  I’m picking on optometry not because they’re unusual – they’re much the same as everyone else who is facing having their entire life and livelihood replaced by a disruptive app or Silicon Valley startup.

These regulations and laws actually end up hurting the economy – they make it more likely that companies like Zenni manufacture outside of the United States and not subject to US or state law rather than creating an eyeglass factory in . . . Kentucky, or Illinois.  I’m not unsympathetic to the 55 year old optometrist – and I don’t have a good answer for what he should do.  Becoming a roustabout in North Dakota in the oilfield is probably not a reasonable answer.  In times past, however, people displaced by technology and Creative Destruction have found new things to do.

Maybe they could ascend to that highest throne of prestige and power.

Blogging, anyone?

Loneliness vs. Being Happy. A choice?

“When a man of Scotty’s years falls in love, the loneliness of his life is suddenly revealed to him.  His whole heart once throbbed only to the ship’s engines.” – Star Trek

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The Boy at six.  How much fun is Christmas?

This week the Internet has been aTwitter® about loneliness.  It’s part of the cycle – it’s Fall, so it’s time for peak talk about being lonely.  Weight loss stories go year ‘round, but they peak after Christmas.  And the stories have a kicker.  “Loneliness is worse than ______ (obesity, high blood pressure, smoking, or, heck choose your own favorite disease to fill in the blank).”  The most recent article that I read seemed to focus on middle aged men, but I think it goes much deeper than just loneliness.  I think the roots are back to Hope.

When was the last time you were so excited that you could hardly sleep because of the day ahead?  That’s Hope.

I’m old enough I enjoy giving stuff more than getting it, but I’ve observed that kind of Hope, that level of anticipation most recently in The Boy and Pugsley.  The Boy is seventeen, and really surprising and delighting him at Christmas is difficult, now.  But Pugsley is twelve and would have the Christmas tree up in early September if we’d let him.  Pugsley dearly loves Christmas, and that spirit is alive in his heart, even when The Mrs. and I play Scrooge and Grinch®.  The Christmas Spirit (which is really just super-concentrated Hope) is naturally strong in the young.

I’ve recently discussed Scott Adams’ Formula for Happiness (LINK),

Happiness = Health + Money + Social + Meaning.

How does it apply to the young?

Health is (generally) a given.  When a child is sick enough that he leans over the side of his bed and throws up in his brother’s pants (which just happened to be on the floor there because they shared a room), he tends to remember that.  (My brother, John Q. Wilder, was not happy.)  Youth and vitality go together, since they haven’t had time to wreck their health yet.

Money is a hit or miss.  But (generally, again) money issues don’t weigh heavily on the mind of a kid.  They know that times might be tight, but they have no perspective to keep them up at night worrying about money.

Social?  In all but the extreme cases, kids have plenty of chances to interact with other kids and make friendships that last a lifetime.  Even shy kids.  They might not be friends with the popular kids, but they can have friends.

Meaning?  Yes, but like kids, it’s pretty shallow.  Being good is near enough what constitutes meaning for the younger set.  Meaning often comes from adequate performance and parental praise.

But as people get older (past their thirties), the equation changes.

Health:  Yearly you are reminded of increasing limitations, stronger eyeglass prescriptions, and less hair (except on the back, where it grows thicker than an Amazon rain forest).  Ow.  My hip hurts.

Money:  Generally people are better off financially as they get older, with the caveat that their peak earning potential may be in the past.

Social:  Friendships may have worn away through long hours and distance – most social contacts might even be at work.

Meaning:  Meaning likely comes from work, spouse, or volunteer organizations, or, in some cases, just making it to another birthday.

What role does hope play?  Hope is looking forward to time with friends and family, having goals big enough to be worthy of chasing, having plans of things you want to do and experience.  These things lead to enthusiasm and excitement in life.

What does the opposite side of the Adams Equation look like?

Despair=Poor Health(No Hope)+No Money(No Hope)+Alone Socially(No Hope)+Meaningless Existence(No Hope)

Despair leads to all the bad issues:

  • Loneliness
  • Depression
  • Disappointment
  • Sadness
  • Pain (real, not like needing a safe space in college because spaghetti is cultural appropriation)

It’s a lot like being a fan of a California NFL© team.

A sudden cratering of any one of the factors in the Equation of Despair can bring about a vicious cycle, leading to spiraling sadness.  This despair is dangerous – fatal if long enough and deep enough.  How many widows die within a month of their husband?  How many men die a month after retirement?

Whereas Hope can put you in a bad place and make you stay for too long (bad job/bad marriage/Raiders® fan), Hope is of then the only thing that will keep you alive when things go horribly wrong, as they absolutely will from time to time.

I think the key might be in being able to look at the world, not through the jaded eyes of experience, but by being able to maintain that sure Hope of a six year old on the night before Christmas . . .

Tom Petty, AM Radio, Heavy Metal, and Motivation

“If you ask me, you are both off the mark.  Last night was about two people ruled by very powerful superegos, tortured by them, who found a chance, however misguided, to break through and rediscover their ids together.  Call me an old softy, but that’s how I see it.” – Frasier

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The Boy and Pugsley dancing in the rain, which makes my id sing.

I’m not sure exactly when I first heard a Tom Petty song.  Where I grew up was media vacuum.  On TV, we had three channels, plus PBS® (Who watched PBS©?  Nobody.).  Unless it was nighttime, we only got two radio stations, and both of them were AM stations.  One played country music, so, for me it might as well not have exisited.  The other played a complicated mix of top 40 from four years previously, news, and an hour of mariachi music at lunchtime.  It signed off (shut down) at 11PM.

But at night . . . at night the mighty KOMA blasted out 50,000 watts of rock and roll at 1520 on the AM dial, the ionosphere conducted the signal hundreds of miles and back toward earth and over the mountains to my house.  It’s probable that I first heard Tom Petty on some cool summer night (down to 50 ˚F most summer nights).  Maybe it was “Don’t Do Me Like That.”

But Tom was always a bit older than I was, both in age and in the issues he raised in his musical themes.  Me?  I gravitated toward metal, mainly hairy metal, Ozzy™.  Mötley Crüe®.  The Scorpions©.  Despite the previous list, what I liked wasn’t all hair metal.  I liked “normal” music, too.

I ended up on a strange quest:  I’d heard a song, once, and I’d try to tell people what it sounded like, and say intelligent things like “it goes Da Da Dadum dadum de-da dum Ohh-Aiii-Uh . . . Uh.”  The record store clerk would nod knowingly, and point to a cassette or album.  It would turn out to be Judas Priest™.  Which I really, really liked.  Or Molly Hatchet©, which was kinda okay.   I would dutifully buy the tape or album, zip home (first on my ten speed, later in my pickup) and then listen to the album.  Normally, in the first song I would know if it was the same singer.  Always the answer was it wasn’t.  But these mistakes were beautiful – I can still remember sitting on the couch on a dim, overcast day, the clouds pregnant with snow that had yet to fall, blasting “The Hellion” and thinking . . . “okay, life is really cool.”

Imagine that this song played every time you entered a room.  I imagine Google® is working on that.

Again, none of them were the band I was looking for.  I think I spent $300 or so on every single album that featured leather, scantily clad females, and Spandex® that I could find.  For reference, I had all of these as either cassettes or albums.  Album cover copyrights belong to their respective corporate overlords.

iron_maiden_killers_frontal

Funky font?   Check.  Picture that looks like something the disturbed kid drew in art class?  Check.

dio

Satan?  Check.  Priest in glasses being thrown into a pit of fire?  Check.

twisted-sister-under-the-blade-1

Hmmm.  I don’t know about you, but something screams, John Wilder, BUY THIS ALBUM NOW!

raven

Spandex®?  Check.  Leather?  Check.  Canadian?  Check.  But . . . they’re dudes.  I bought this on cassette, so, thankfully, the picture was tiny.

heavy-metal-soundtrack-album

Swords?  Check.  Giant flying leathery chicken?  Check?  Leather . . . on a girl this time?  Check.

AliceCooper

Wow.  Just . . . wow.

heavy pettin 2

I never could figure out what sort of naughty thing they were supposed to be doing.  In the day.  At a drive in.  With both feet out the window.  Probably ripping the labels off of pillows?

Until . . . like Columbus I discovered what was already there (and broken up by the time I found them): Led Zeppelin.  True Fact:  Christopher Columbus first discovered Robert Plant picking onions in a Nevada prison camp, and introduced him to Jimmy Page at a ballet class, but would take no credit because he wanted Led Zeppelin to do disco music.

So, I listened again to Zeppelin. “Yeah, it might be that guy singing?”

It was.  It was this song:

This was the song.  Yay! 

But I’d have to special order the album, since they didn’t have Led Zeppelin III in stock.

Nope.  Too much commitment.

As you might have been able to tell by the artists and album covers above, my musical tastes were driven by my id.

If you don’t remember your Freud, he broke the brain into three bits:

  1. The Super Ego, which, like your dad, is for criticism and moralizing.
  2. The Ego, which is the organized human who lives on the main floor and deals with society in a realistic manner, and
  3. The Id, where all base instincts (Sex, PEZ® and Rock and Roll) live in the basement of your brain.

I listened to a lot of rock that was id driven.  And why not, I was working on a multi-decade winning streak.  Sad songs were for people who occasionally lost stuff.  But Tom Petty’s music was deeper.  It spoke to the conflict between the Super Ego and Ego, an intellectual and emotional conflict I really didn’t have.  I was riding high on year after year of success, slaying dragons and charging the castle.  Why would I question anything?  Party on, dudes!!

It wasn’t that Tom and I didn’t get along – he was no Bruce Springsteen or Johnny Depp, who are both dead to me.  They know why.

Really, it took life kicking me in the teeth more than once to move me from the normal reckless abandon that I attacked life with to a person who asks the kinds of questions that Tom Petty discusses in his songs.  I still recall having a conversation with The Mrs. when I began to realize that I liked Tom Petty:

Me:  “You know, the older I get, the more I understand Tom Petty.”

The Mrs., shaking her head, raising her voice a little:  “Can’t hear you . . . blow dryer on.”

But now Mr. Petty is speaking to me again – he died.

It’s not unusual for rock stars to die young – it’s like we pick an unstable, talented personality and then shove massive amounts of cash at them.  I’m just surprised that 90% of them aren’t dead by 30.  Just my luck that after the apocalypse the Twinkie®, the cockroach, and Johnny Depp will still be around.

But Tom Petty won’t be around, even though The Postman (movie) promised me that he would be.  His death hit me (oddly) harder than I’d anticipated.  He hadn’t been my life’s soundtrack, though I’d clearly been listening to him more recently.

He made it to 66.  According to the CDC, 83% of white non-Hispanics will make it to 67.  Only 1% of 66 year olds die.  If you make it to 66, your mean life expectancy is to make it to 86.  So, from this data, he died early.  But he didn’t look out of shape.  Far from it – he’d just finished a part of a concert tour comprised of 50 dates in five months, which can take a toll on 26 year olds, though I presume at 26 it’s the Jack Daniels® and late nights and not the (presumed) warm tea, oatmeal cookies and obligatory cellophane wrapped butterscotch hard candies that old people like that filled the Heartbreaker’s dressing room.

Though Mr. Petty was quite a bit older than me, I guess his death hit me like it did, because even at 66 it seemed he should be too young to die, just as his voice entered my soundtrack with a greater frequency and volume.  It makes me feel that much more mortal, and therefore more committed to getting into the best shape possible now so I can be in the 50% that make it to 82 years.

Tom Petty inspired millions in many ways – through emotional ups and downs.  He inspired artists everywhere that they could pick up a guitar and play and that their music would, like his, give them a slice of immortality.  And guys like me who want to keep runnin’ down our dreams.  I think this is the part where I get the dragon, right?

Thanks, Tom.

Income, Happiness, and Bad AC/DC

“See, this is what we call an all you can eat buffet.  Here you can eat all you want for just $6.99.  That why everyone comes here on Tuesday nights, except for Kenny’s family because for them, $6.99 is two years’ income.” – South Park

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The purpose of having money is so you can afford to buy things like this. 

I remember having a negative net worth and still enjoying most parts of life.  I had my health, my youth, good friends, PEZ® and meaningful work.  I also remember sleepless nights worried about how I was going to pay this bill or that bill.  I clipped . . . coupons.  And used them.  I’m so ashamed.

Let me back up.

I was married before The Mrs., as I’ve mentioned before.  That relationship ended (which made both of us happy) but my previous spouse had been in charge of paying the bills.  On her last day in the house she handed me a bulging plastic grocery sack filled with bills.  She then handed me a checkbook in a blue plastic cover, the sides of the cover starting to crack at the point where the cover bended to open and close the checkbook.

“I have no idea how much money is in the account,” she said.

The answer was, “not much.”  The first bill I pulled off the top of the stack was a credit card that hadn’t been paid in several months.

Wow.

I got out a spreadsheet and started to add up bills.  I made a list of minimum payments.  I made a pretty ruthless budget ($4 a day for food for three?) and . . . went to work.  I took a loan against my 401K and paid all the back payments due on the accounts.  Lots of Hamburger Helper®.

But was I happy?  Well, yes.  My friends said that I hadn’t looked happier in years.  And I felt happy.

Now there has been no time in my life where I couldn’t afford to feed my family.  Were there times when I was a week of payments away from being at zero cash?  Certainly.  Did I have an emergency fund?  Not really.  I could have played the alternate-bill game, slowing payments for the electricity so I could pay the gas.  I could have maxed out my credit cards, sold family heirlooms, sold plasma, sold a kidney.  I could have averted bankruptcy for a few months.  Emergency fund?  No, a catastrophe spending plan.

Thankfully, it never came to that.  So, a negative net worth and a happy life?  Sure.  I was young:  the future was wide open.

But you don’t have to trust me.  Actual Nobel® Prize-winning economists (Angus Deaton and Daniel Kahnemann) did a study where they tried to measure the impact of income on happiness.  And, they found (in 2010 dollars, which were less plump and firm compared to today’s inflated dollars) that happiness was maximized at a household income of about $75,000 (that would be $85,000 in today’s dollars).  People’s perception of life increased with more money (they thought they were doing better) but they weren’t any happier.

I then began to wonder what factors might influence whether or not $85,000 is enough?

  • If you’re paying a huge proportion of your income on debt, it will prevent you from spending on other things.  In my personal example, I had debt, but I also had a plan:  work like the devil to pay it off.  Each retired credit card or past due bill was a little victory.  There are some forms of debt, though, that are worse than others.  The king of bad?  Student Loan debt.  While education is valuable, the only way to default on a student loan is to die, and I think that’s pretty extreme to get out of a bill.
  • Location, location, location. New Yorkians and San Franciscainites would scoff at $85,000 per year.  Their homeless rat-catchers make more than $85,000 on a bad year.  I tried to come up with a city that might be near the national average for cost of living:  I ended up with Reno, Nevada.  To replicate $85,000 in Reno would require $184,000 in Manhattan, and $143,000 in San Francisco.  I’m not sure that this really covers it, because the average house in San Francisco per this survey was $1,000,000, and the last time I looked, $1,000,000 buys you a house with 830 square feet in San Fran.  750 square feet in Manhattan.  My college apartment was larger.  No free range children there – you probably have to stack cages to keep more than one.
  • What does your future look like? This is going to impact your overall contentment.  Feel like it’s all over and the dark of winter of your life is at hand?  Or is it just dawn, and you’re looking at a warm spring day with a lifetime ahead?  Your perceptions of yourself, your potential, and your future influence your contentment.  Grumpy old men?  Yeah, they think that they’re at their winter and are angry that you’re limber enough to touch your toes.
  • Number of Kids/Parents to Support. Have you ever spent money to buy food for a seventeen year old defensive tackle/noseguard?  I have seen The Boy get up from a Sunday dinner and go directly to the fridge to see if there’s anything to eat.  How many ribeye steaks can you eat?  I’ve seen him eat three.  After three or four bratwurst.  These are not exaggerations.  I went shopping one Sunday with The Mrs.  We had a shopping cart filled with food.  She looks at me.  “This is just for The Boy’s lunch.  One week of his lunch.”  He has a little brother, Pugsley, who will soon enter Junior High and the high calorie consumption of testosterone and a teenager.  Then there’s college.  There are cars.  Spending money.  Have a dozen kids?  Yeah, $85,000 for the household seems a bit sparse – you might need to sell some for medical experimentation.
  • Medical Expenses. The Mrs. listens not to my entreaties that her insulin costs nearly as much as gold per shot.  She’s all, “Well, if I don’t take it I’ll die.”  The Mrs. has a really crappy pancreas.  But if you have medical expenses that are very high?  Forget insurance – it’s been awful for years – it’s like paint made for the government:  it’s expensive and covers nothing.  Have enough of these issues?  Jimmy Kimmel will cry for you, and $85,000 might seem woefully small.  Note:  substituting “homemade” insulin is not recommended.  The Mrs. did NOT think that was amusing.
  • Hobbies.  Sure, they’re optional, but we’re talking about being happy.  I like collecting 17th century glassware.  And then using it for practicing skeet shooting.
  • Spending Habits. Being on a budget sucks – the discipline it takes to plan and scrimp and save is rough, but it’s better than homelessness . . . .  Sometimes you don’t get to pick the Sam Adams® and have to just pretend Natty Lite© is awesome.  My previous post on the money philosophy of Mr. Money Mustache, Financial Samurai, and Early Retirement Extreme still applies (LINK).  Read it.

The Kinks understand that nobody likes being a cut-priced person in a low budget land . . .

So the $85,000 is above the median (half of the households above, half below) household income of ~$60,000.  As near as I can figure, $85,000 puts a household in the top 35% of income in 2017.  Again all of this research doesn’t prove you’re happy or unhappy at any income.  It just shows the sweet spot where additional income seems to stop adding additional contentment for most people.

I would (personally) guess a big predictor of long term happiness would be the amount of wealth that you had managed to save.  It would certainly add peace of mind, knowing that you had some long term money, and that would remove a lot of the day to day stress from unexpected events – job loss, sickness, needing to buy Cher concert tickets.

But can you have too much money buried in Mason Jars® behind your house?  Sure.  If it removes your incentive to work, does that remove meaning from your life?  I’ve seen more than one person retire and die a month later.  And you don’t have to be old to lose your purpose and give up, as Buzz Aldrin proves (LINK).  Not everyone will lose their purpose, and I really do recommend working until you’re sick and tired of it – that’ll get you in the right mindset to retire.

But higher income come with issues as well that might detract from the overall contentment that income earners get – don’t think that the $150,000 crowd has it easy.  Long hours.  Deadlines.  Job insecurity (average VP only lasts six years before being canned).  Travel.  Time away from the family.  Awful bosses (CEOs rank high on the range of socio-psychopath).  So, at some point, it’s probably better to live cheap rather than live a stressed out life.

Because the future is wide open . . . .

Some bonus content, since we’re thinking about cheap:

The following is almost nine years old, back at my old blog, Wilder by Far.  Here’s a link to the original post (LINK).

For your pleasure, I have transcribed an AC/DC™ tune Dirty Deeds Done Dirt Cheap, as written by William F. Buckley. Enjoy.

If you’re experiencing difficulty with the school principal
He’s making you quite sad
You wish to complete education without resorting to implied sexual intercourse
Here is a course of action
Grab a telecommunication device, I never leave my domicile
Contact me whenever it’s convenient
E-mail – Bonn.Scott73@acdc.com
I conduct my life through extralegal means

Hey

Nefarious acts, performed inexpensively
Nefarious acts, performed inexpensively
Nefarious acts, performed inexpensively
Nefarious acts and they’re performed inexpensively
Nefarious acts and they’re performed inexpensively

You are experiencing difficulty with your life partner
You have serious emotional depression over the relationship
He’s conducting a clandestine illicit possibly romantic relationship with someone with whom you share extremely strong interpersonal ties
You may feel so emotionally distraught that you cry
Grab a telecommunication device, I am currently not in the vicinity of other humans
Or come visit informally with no set purpose or agenda
Enter and remove thoughts about him from your mind
We will cooperatively either stage a fancy dancing party or partake of our own illicit romance

Hey

Nefarious acts, performed inexpensively
Nefarious acts, performed inexpensively
Nefarious acts, performed inexpensively
Nefarious acts and they’re performed inexpensively
Nefarious acts and they’re performed inexpensively

You have a female domestic partner whom you wish to no longer have contact with
But you lack courage to take action
Your domestic partner is continually argumentative and critical
Sufficiently so to make you question your mental competence
Grab a telecommunication device, leave your domestic partner without other human companionship
The proximate moment for you to exhibit some sort of courage is now
With reasonable financial remuneration, I would be glad to
a)perform a silent act of assassination while you pursue your own alibi or,
b)have an illicit romantic encounter with your female domestic partner
(the Internet is unclear here, I prefer version a since I see no reason version b would in any way bring the situation described to a favorable conclusion, but there is some scholarly debate)

Nefarious acts, performed inexpensively
Nefarious acts, performed inexpensively
Nefarious acts, performed inexpensively
Nefarious acts and they’re performed inexpensively, yeah
Nefarious acts and they’re performed inexpensively
Nefarious acts and they’re performed inexpensively
Nefarious acts and they’re performed inexpensively

Heavy quasi-stone masses intended to sink bodies when attached to the feet
Molecules containing triple-bonded carbon and nitrogen
Tri-nitro-toluene
Performed inexpensively

Ooo, common items used for the purpose of constricting the ability of a subject to breathe
Agreements to do wrong
Large differences in electrical potential
Performed inexpensively, eah

Nefarious acts, I will perform them without regard to what they are, performed inexpensively
Nefarious acts, nefarious acts, nefarious acts, performed inexpensively

Yaaargh

Eclipse, Game of Thrones, Chili’s Restaurant

“Or we could stare at an eclipse while screaming at it!” – Upright Citizens Brigade

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This picture of the Sun’s corona is courtesy of The Boy, the number 8, and the letter W.

Like millions of other Americans within a short drive, The Boy, Pugsley and I piled into the Wildermobile and headed for destiny.  (For the record, millions of Americans didn’t pile into my car.  They got into their own cars.)

Actually, it was a Marriott© instead of destiny, but I hear those things can be related.  This was no ordinary Marriott®, rather it was one strategically placed within 90 minutes or so of the Path of the Great American Eclipse, which would snatch from us, momentarily, the Suns Life Giving Yet Deadly rays.

We had packed our Solar Viewing Glasses, which we had gotten for free a week earlier at our local library.  “We” is really The Boy, who I had to threaten with the immediate torture of being pulled from the Matrix through restriction of his use of any device invented since 1907 should he not comply.  “Later” seemed to be built into his answer.  Take away his Tweeter® or his BookFace©?  Yeah, that would be like amputating a limb.

A week out at the library?  Plenty of eclipse glasses were freely available.  Three days out?  None.  Again, people do NOT plan.  It seems like that when it’s bright and sunny out, even when they know that winter’s coming, they don’t put up extra food or even minor emergency preparations.  After you’re observed people long enough, you learn that most of them . . . don’t learn.  (But not you, dear reader, who likely have an IQ high enough to give a normal person a nosebleed due to altitude sickness.)

The Mrs. was skeptical when I tried to get hotel reservations a scant week before, but Marriott gleefully set up the reservation.  Originally, she was going to accompany us, but the day before we were to leave for the hotel, we took a nap, and she slept through the time when she was supposed to take the dogs to the kennel for boarding.  The Mrs. sighed . . . happily.  I’m not sure she was at all excited about an eight hour trip into the deepest uninhabited part of Upper-Lower Midwestia just to not see the Sun.

The Boy, Pugsley and I planned (prior to leaving) on when and how we were going to leave on our great adventure.

My plan was that I wanted to get there so I had about 90 minutes to eat dinner prior to Game of Thrones (spoiler – Ned gets decapitated at the end of season one).  Pugsley, however, had configured some sort of alternate reality that involved us getting there at 3pm.  The Boy bought into this alternate reality and stubbornly wore his backpack starting two hours before I started packing.

Keep in mind, The Boy is nearly 17.

I think both The Boy and Pugsley were excited.  The Boy was even more excited when I tossed him the keys.  He drove us from Stately Wilder Manor to dinner, and then to our hotel.  My daughter, Alia S. Featherbottom (nee Wilder) was going to meet us, but forgot we were coming as she fell into a pit of Dungeons and Dragons®.

Now, as a general note, we don’t let Pugsley (12) watch Game of Thrones.  The reason for this should be obvious to anyone who has watched the show.  Tonight?  Single hotel room?  He sat and watched Galaxy Quest with headphones on.  Although The Mrs. and I normally sit and watch the show together, in this case she and I texted back and forth during the episodes.  Here is an example exchange:

The Mrs.:  “There’s more walking in this episode than in The Lord of the Rings.”

Me:  “At least they’re not singing.”

After that I poured my heart and soul into (yet another) post about how stupid NASA is (LINK), but even I am beginning to feel a bit guilty – picking on NASA is a lot like hitting a kitten.  The Boy helped by doing my thermodynamics calculations.

I had carefully selected our site.  It was about fifteen miles from the nearest town, and it was on a nice corner where the line of totality exactly passed over.  It was perfect.  The only problem?

Clouds.  They were everywhere.  I pulled out my cellphone and had the path of the totality map up.  On another cellphone I had the cloud cover map.  I reviewed first one phone and then the other, cross referencing one map to the other, sort of like Columbus if he was having trouble getting 3G on the Santa Maria like I was out in the cornfields.  At least he had WIFI when the Pinta hit Hispaniola, right?

Plotting one map against the other while The Boy drove, I made a decision.  The GPS said to turn right.  I told The Boy, “Turn left.”

With that, we moved off plan.  We had gone rogue, chasing bits of blue sky.

We navigated farther west, and soon, bluer patches of clear sky were NOT obscuring the Sun.  We were getting closer . . . finally we stopped in a small town park.

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We pulled into position about 40 minutes before the eclipse.

The park was filled with nice, friendly people.  Which makes sense.  These are the type of people who are intellectually curious, and were patient enough to drive hours to a small town for a two minute eclipse.  These weren’t troublemakers.

The eclipse itself was sublime.  The Sun was a fat crescent, a slim crescent, and then it was gone.  There were some light clouds, but they weren’t a major eclipse of the eclipse.  We had chosen our site very well.

My biggest personal surprise about the eclipse was that it didn’t go completely dark – I guess I had expected that.  Venus was very visible in the sky, but the clouds surrounding us (35 miles away) were still lit by the Sun, and that lighting left me feeling like I was under the world’s largest sunshade, which I guess that I was.

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My picture of the Sun’s Corona.  I prefer Negra Modelo myself.

It had been an oppressively hot and humid day.  The temperature dropped a bit during the eclipse, and that brought out thick clouds as the water vapor in the air condensed out.  We got in The Wildermobile and The Boy started driving us towards home.  The worst traffic jam we saw took place at a T intersection about 30 miles south of totality, and it was about a mile of politely and patiently driven cars that took us about ten extra minutes to get through.  The traffic apocalypse foretold by Nostradamus did not emerge.

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The above fiberglass squirrels were all over this town, and every squirrel I saw was painted differently, but all of them had eclipse glasses on.  Who says Midwesterners don’t know how to party?

The Boy drove us back down to a Chili’s® restaurant 90 miles south of totality.  It looked like it was closed, with zero cars in the parking lot.  I jumped out to check the door, it was open, and they were open.  We ordered food, and the waitress said that there had only been one table that had been there for lunch.  Apparently, your willingness to eat at Chili’s™ is some sort of predictor for you to go to see an eclipse.

The Boy drove home, and I slept most of the way.

Most of the way.

On the way back I mused on the events of the day – we had seen a solar eclipse – our first total solar eclipse, and I was reminded of something I heard Tony Robbins say:  “Money can’t buy happiness, but it can buy experience.”

I guess my takeaway is:  “Being nice doesn’t get you Eclipse Viewing Glasses, but angry threats do.”

Self Control, Soviet Tanks, and Stanford Marshmallows

“Any problem caused by a tank can be solved by a tank.” – Family Guy

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The featured image is geology.  Which is way cooler than what the class made it seem.  This is one I took in Alaska.

The first all-night study session I that I did involved studying for finals the first semester of my freshman year at college.  I do recall getting increasingly tired, and at 4AM I jumped in my car to buy, for the first (and last) time ever:  No-Doze®.  No-Doze™ was awful.  I felt jittery.  I felt my teeth moving around in my gums.  I felt my eyes moving around in their sockets.  It felt like there were bugs walking around on the inside of my skull.  Thankfully, I was distracted by actual pain in my stomach (due, I’m pretty sure) to the No-Doze©, which is what kept me awake.

I ended up doing fine in my tests, but can only recall that “Cops On Streets Detain Crime” (Cambrian, Ordovician, Silurian, Devonian) and “Miss Pennie’s Panties” (Miocene, Pliocene, and Pleistocene).   I think I’m missing a billion or so years of geologic history because there wasn’t a sufficiently naughty mnemonic involving underwear.

Oh, and I can also recall that No-Doze© is the work of the devil.

Looking back, it seems so simple.  A little effort each day would have paid off at finals.  Big time.  Study a subject (like geology – lots of memorizing) a little bit each day.  By the time finals rolled around?  With just a few minutes of study, I’d be ready to take the final, and do so on a full night’s sleep.

However, while study may payoff later, not studying always pays off now.  Present Me can have a beer, go to a movie, read a book, watch an episode of Twilight Zone®.  These are all better than studying geology.  Honestly, a dentist visit is more fun than studying geology, though it’s still probably easier to sleep through geology.

What has all of this got to do with Wealth?  It’s Wilder Wealthy Wednesday, so how does all of this tie in?

I’m glad I asked.

Everyone makes choices about how they spend their resources.  There are the needs of the Present, and those of the Future.  Example:  if retirement and putting The Boy and Pugsley through college weren’t issues?  I would own a tank.  You can buy them, you know.  (LINK)  Real tanks, sold by Eastern European arms merchants.  It sounds like Bruce Willis should be in this movie, right?  Oh, and I’d also own a swimming pool filled with Pez® that I would swim in like Scrooge McDuck™.

But I won’t.  I value Future Me enough to forego the fun of riding around the neighborhood in a fully functional WWII Soviet tank.

Barely.

And it’s mainly so The Boy and Pugsley can get jobs and not have to live in my basement and borrow my tank.  Future Me likes that Future.

This is also the way borrowing money works.  Present Me decides he wants something, like a house.   Present Me obligates Future Me for thirty years’ worth of mortgage payments.  Good deal.  Let’s pretend I don’t have the cash to buy what I want.

If that’s the case, I find someone who has cash, and trusts me enough that I’ll pay ‘em for the next thirty years.  For their trouble, they get, say 5%, of the unpaid balance each month as rent on their money.  They like that deal because they’ll have more money when it’s all done.  I like the deal, because I get the house now.

An economist would call the interest rate charged to me for borrowing the money a “discount” rate.  It’s the amount that the bank charges you so that they have a durable long-term investment that makes sense for them.  If you can’t afford to meet their discount rate?  The bank is required by Federal law to invest their reserves in Russian tanks and Pez®.

The discount rate in most cases is simply a numerical rating of your will power.  If you knew I was going to give you fifty dollars at the end of the month, how much would you give up to get it today?  Of you said, oh, five dollars, that means you are willing to give up 10% of the value . . . for one month.  That’s (we can quibble about this number, but we won’t for now) a huge premium, the equivalent of 314% annual interest.  If I could get a 10% monthly return, I’d retire . . . this afternoon.

So, our “discount” rate is really a numerical measure of our ability, our willpower, in delaying gratification.

Delayed gratification, it turns out, is a pretty significant human characteristic.

In the 1970’s, Stanford was known for several radical psychological experiments:

  • The Stanford Prison Experiment – A really creepy experiment where students dressed as guards and inmates and completely cost me my faith in Californians.
  • The Stanford Pizza Experiment – I think this was a 1970’s B-Movie. Adrienne Barbeau – don’t miss it!
  • The Stanford Marshmallow Experiment – The one that goes with this post.

In the Stanford Marshmallow Experiment (SME), young children were given a marshmallow.  They could eat it now, or be given two marshmallows later.  I’m obviously simplifying this – they used cookies, too.

About a third of the children made it long enough to get the second treat.  Between this and a previous experiment, there were several primary correlations on just which kids would get the second treat.

  • The older kids were more likely to get the second marshmallow.
  • Intact family. If there was a dad in the house?    No dads around?  No second treat.

So what?  A lot, actually:

The longer a child could wait, the:

  • Better the expected SAT score,
  • More education the child would likely complete, and
  • The child would likely be skinnier.

Those are pretty positive, and pretty significant outcomes.  And, although there has been complaint about the study (small sample size, flawed methodology) since it matches my biases, I’ll assume it’s right.  (Hint:  this is how some journalists actually think, or rather, avoid thinking.)

Are there other examples of discount rates/willpower out there?  Sure.  We keep creating academics, and they have to look busy, so they keep writing papers for each other.  Thankfully Jesse Shapiro wrote one (LINK) just to prove a point in my blog.  Thanks, Jesse!

Shapiro looked at food stamp recipients.  He found that there was a 10% to 15% drop in calorie consumption from the start of the month when the EBT card was filled up to the end of the month.  Some people ate enough at the beginning that they had to skip meals at the end.  Additionally, it looked like the food that folks ate through the month also was . . . not as good.  The overall quality of the food consumed appeared to have dropped during the month as well.  Might there be other contributing factors to this?  Sure, but the data didn’t seem to indicate that was the case.  And that 10-15% discount rate is huge.  Over 300% annually (compounded).

So, why should you delay gratification?

  • When it’s clear that it’s good for you.
  • When there’s certainty to the payoff.
  • When the payoff is big enough to make Current You value it almost as much as Future You.

Most of the time we have enough real information to know if it’s good or not and how certain it is.  It’s that last bullet point:  making Current You care enough.  Why do people smoke?  Their Current You runs a big discount rate on the first two factors.  And maybe Future You just pisses Present You off?

One last thought on willpower.  Remember that study that showed intact families mattered?  Yeah.  If the Mom is impulsive enough to get preggers by a man she can’t have around, or if the man is impulsive enough to bolt?

Bad news for those kids.  Willpower and the ability to delay gratification is, like intelligence, highly inheritable.  Looks like it’s late nights and No-Doze® for the lot of them.

Elon Musk: The Man Who Sold Mars

“Actually, they theoretically can separate the hydrogen from the oxygen and process that into providing fuel for man’s space flights. Ostensibly, turning Mars into a giant gas station. So it’s a . . . yeah. We live in an amazing time.” – Breaking Bad

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The featured picture above the title is of the Saturn V.  It’s longer than a Harry Potter novel.  This picture shows the engines from the main stage of the Saturn V.  About 275,000 horsepower for all five engines, you can totally tell by the lens flare!  But it got over two miles per gallon of kerosene used (TRUE)!

This is the third and final part of Elon Musk Week® (sort of like Shark Week©, but with 100% less Discovery™ channel).  An annual feature?  Maybe!

Part 1 is here (LINK) where we take apart Tesla®, and Part 2 is here (LINK) where we understand Elon’s Matrix® plan.

I first read about Elon in (probably) 1977 or 1978.  Oh, sure, you’re saying, that would have made him six or seven years old, and at least a continent and two hemispheres away from me.  My only response is, “so what?”

When I was a kid, I lived fifteen miles from the town I went to school in.  My house was the farthest away on the school bus line, so I was the first to get on in the morning (7:15, every morning) and the last to get off (4:30, so I missed F-Troop).  I could stare out the big picture window and see the bus a mile away – Ma Wilder taught me it would be rude to keep the bus driver waiting – and out I would go to be there waiting when the big yellow bus pulled into my driveway.

For about two hours a day as the bus stopped to pick up and then let off children, I could either stare out at the mountain scenery, or I could drop with Johnny Rico and The Roughnecks into Klendathu.  Or I could visit Trantor, first with Hari Seldon, and then later with The Mule.  Or ride Sandworms on Arrakis with Paul Atreides.  Or be shocked at the mysteries when we Rendezvoused with Rama.  Or finish all the science fiction anthologies at the middle school library by the middle of my seventh grade year.

And reading wasn’t confined to just bus time.  There were only three channels of television available (no one ever counted PBS, unless Monty Python was on) an half the time nothing interesting was on.  So, if I had built all the model kits around (the usual condition – they didn’t last long) and it was too cold to go hiking or fishing, I always had a book ready to read.   And Ma Wilder said I had to go to bed, but she never said I had to go to sleep . . . my parents bought me a reading lamp that clipped on my headboard for my tenth birthday.

But I remember reading the Hugo®-winning “The Man Who Sold the Moon,” by Robert A. Heinlein fairly clearly – it wasn’t on a bus, but on the couch by a crackling fire on a cold (-20˚F) winter’s day.  And that’s when I met Elon Musk.

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(source, Wikimedia)

Delos David Harriman (better known as D.D. Harriman) is the billionaire who decides to go to the Moon.  Why?

He envisions a new economy – an opening of the Moon is the first step to opening the Solar System to humanity.  Rather than living in a world which with a fixed horizon, D.D. realizes that getting off this rock is the only possible positive future of humanity.  But getting there is possible, and only takes will.

To quote Harriman:

“In fact, the real engineering problems of space travel have been solved since World War II.  Conquering space has long been a matter of money and politics.”

Contrast with Musk:

“Boeing just took $20 billion and 10 years to improve the efficiency of their planes by 10 percent. That’s pretty lame.”

And how was Harriman going to do it?

“I’ll hire the proper brain boys, give them everything they want, see to it they have all the money they can use.”

Contrast this with Musk:

“The path to the CEO’s office should not be through the CFO’s office, and it should not be through the marketing department. It needs to be through engineering and design.”

And I could go on and on about the similarities but the one thing I know is this:

Musk read the same stuff I did when he grew up.

Musk knows D.D. Harriman.  Just like I did, Musk admired D.D. Harriman.  However, Musk has become D.D. Harriman.

And for that, my hat is off to him.  D.D. Harriman is much more important than Tony Stark®.

And Harriman was willing to do absolutely anything to open space to humanity, convinced it was too important to leave to governments and bureaucrats.  Harriman manipulated stock, forged fake space-diamonds, and extorted advertising dollars from soda companies.

Musk feels the same way.  Musk formed SpaceX™.  Musk got involved in Tesla®.  One is his passion, one (even though he believes in the mission) is there to fund his passion.  Make no mistake:  Musk has created more applied rocket engineering faster than any person in history except maybe Von Braun (though Bezos is giving him a run for his money and has super-cool biceps for an old man).

Why not NASA?  Isn’t it their job?

During the 1960’s, NASA had a mission.  It was going to get three guys to the Moon, by the end of the decade.  Lots of engineers worked lots of long hours and made it happen.  In July of 1969, NASA dropped the mic after “One Small Step” and walked off the stage.  Mission done!

Well, almost fifty years on from that date, and six of the twelve men who walked on the Moon are now dead.  During the middle?  NASA developed one (anemic) space launch system – The Space Shuttle, whose sole purpose appeared to be to construct the International Space Station.  Why construct it?  So the Shuttle had a place to go, silly.

And now we have no space launch systems available to us except through the Soviets, er, Russians, and . . . Elon’s SpaceX™, which currently plans to have a manned launch of its Dragon/Falcon taking place in early 2018.  The first manned Orion flight?  Maybe 2023.  Maybe.

Why is NASA so sick?

The original group they hired were engineers.  Their job?  Get into space, get onto the moon.  Then they fired most of them, but kept enough to send out a fairly constant stream of unmanned probes as well as lame manned space missions.  But during the 1970’s they also hired a lot of administrators.  And people who had no connection in any respect to a spacecraft, or science, or aeronautics.

Except for brief bursts of public interest when something worked really well (Viking and Voyager) or when something worked really poorly (Challenger and Columbia), NASA has reached an irrelevance in national policy.   NASA appears to only be important when it comes to funding large amounts of money to projects that take place in certain Congressional Districts in certain strategically important states.  In Houston they love NASA, or at least NASA dollars.  Efficiency?  Progress?  Why would you need those things?  Heck, we can have astronauts but not have spaceships!

These are the depths that NASA has fallen to showcase its technical bankruptcy:  it has a division called the “Solar System Exploration Research Virtual Institute.”  This division produced 5,000 braille books about the eclipse for the blind.

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These are the official shot glasses of the Manned Spaceflight Center.  At least it’s one way to blast off?

I am not opposed to a company doing this – I’m not even opposed to a government agency producing books in braille, especially those that aren’t available on audio.  But I am opposed to NASA doing it.  Why?

NASA’s mission is:

To pioneer the future in space exploration, scientific discovery, and aeronautics research.

Nothing at all in there about getting blind people books about an eclipse.  Nothing close, so this is a symptom of a system that has gone beyond dysfunctional to trivial.  A dysfunctional system (or in this case, organization) just can’t get anything done.  A trivial organization works on everything.  It invents steps where none need be, make-work (like the books), bureaucracy (credentials for everyone!), and hurdles (did you file the right form?) until Pournelle’s Iron Law of Bureaucracy is achieved:

From Jerry Pournelle himself:

Pournelle’s Iron Law of Bureaucracy states that in any bureaucratic organization there will be two kinds of people:

First, there will be those who are devoted to the goals of the organization. Examples are dedicated classroom teachers in an educational bureaucracy, many of the engineers and launch technicians and scientists at NASA, even some agricultural scientists and advisors in the former Soviet Union collective farming administration.

Secondly, there will be those dedicated to the organization itself. Examples are many of the administrators in the education system, many professors of education, many teachers’ union officials, much of the NASA headquarters staff, etc.

The Iron Law states that in every case the second group will gain and keep control of the organization. It will write the rules, and control promotions within the organization.

I think that in NASA they actively look for jobs that they can do that are:

NASA could spend time and effort designing a new hypervelocity spaceplane, but that’s hard!  And someone could get hurt, and that would be bad publicity.  And we know that we as a society will only allow people to be put upon the equivalent of 2,000 tons of TNT (Saturn V) if it’s totally safe!  Otherwise, it’s an outrage!

So, faced between making a new launch system that might help get people into space OR putting together a braille book?  Let’s go with the book.  It’s A. Easy and B. Safe.

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These are the official flip flops of the Manned Spaceflight Center.  They look Safe, unless you blow out your flip flop and step on a pop top and cut your heel and have to cruise back home.  It’s okay, because there’s booze in the blender and you have the Official Manned Spaceflight Center shot glasses.

The only way to avoid the Iron Law and the A. Easy and B. Safe people is to have a personality that keeps focus on the goal.

And since NASA administrators don’t go in and fire everyone in NASA not involved in the mission, you can be certain that they’re fine with . . . whatever the heck it is that NASA is doing.

How is SpaceX® Different?

Elon Musk is a laser of focus on getting spacecraft into the air.  People at SpaceX® want to work long hours, and if you look at jobs on their website, it notes that long hours, working evenings and weekends are probably going to be a thing for you.  And, want to get fired?  Talk about part of your “mission” at SpaceX® being producing coloring books on planetary nebulae.

Sounds like old Harriman himself, “. . . sweet talk them into long hours – then stand back and watch them produce.”

Some Libertarians HATE Musk because of the government subsidies that have driven money to Tesla® and even SpaceX©.  I can understand that, especially if their goal is less government.  Heck, I’d like less government.  But even though Musk has to go through roundabout ways to get only a portion of NASA’s funding, he’s running circles around them on talent recruitment, technology development, and actual results.  We have a choice if want to really get into space.  Elon appears to be the only winning answer (unless Bezos is holding back on a few aces).

Musk could fly people in space tomorrow, if they’d let him.  NASA is six years out.  Six years out.

What does Musk plan to do in the next three?  Send a capsule (unmanned) to Mars.

I’d be surprised if Orion ever actually flies people.  NASA seems incapable of spaceflight, and, really incapable of anything more complicated than Twitter.  But if Orion ever flies, I imagine that in orbit the Orion astronauts will get to see Elon’s butt pressed firmly against the window of his Mars Transfer Ship (Red Dragon 11) as he gives them a full moon (pardon) as a parting gift as he heads to Mars.

It’s a long trip to Mars.  I imagine that Elon might take a book or two along with him for the trip.  Probably not “The Man Who Sold the Moon.”  But maybe Dune, or Starship Troopers.

What would D.D. Harriman read?

I’d like to think he’d bring my blog . . .

Hey, everyone (including you, Elon) you can subscribe, and it gets sent out directly when I hit the publish button.

Will you buy a Tesla™ 3?  You already have.

“You guys taking it all in?  Because this is what it looks like when Google acquires your company for over $200 million.  Look Dustin Moskovitz.  Elon Musk.  Eric Schmidt. . . .  I mean, Kid Rock is the poorest person here. Apart from you guys.” – Silicon Valley

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The earliest prototypes for the Tesla® cars were actually called Newton™, and depended only on gravity!

Elon Musk has a plan.  Honestly, I think it might work, and I heartily endorse it.  But you will have to wait until Monday and I’ll share what Elon’s plan really is.  But the good news?  This post and the next two will be ELON MUSK week.  It’s like Shark Week® on Discovery™, but for real nerds.  This is part one.  Part two is here (LINK) and part three is here (LINK).

You might have heard that that Musk made international headlines for . . . delivering thirty cars.  That’s amazing!  He brings out $1.5 million worth of merch, and the world collapses toward him like puppies on a dead wildebeest.  I assume puppies eat wildebeest.   Anyway . . .

In my hometown, they probably sold that many vehicles last week.  You can’t keep a car salesman in cologne with much less than that.  But did the tech journalists hover around Big Mack while he sold Farmer Brown a ¾ Ton Chevy®?  Nope.

Elon Musk has a vision, and a talent for sharing it.  He was the kid in class that could convince the teacher that, sure, it was an awesome fall day out in Pretoria, so they should hold class outsides.

Great idea, Elon!  (In actuality, it sounds like his childhood was much more like a version of Terminator® when it came to the other kids, but I can totally identify with that, too.  Maybe another post.  Nah.)

But Elon moved ahead.  Eventually, after making several hundred million dollars before he was old enough to grow a decent beard, Elon got involved with Tesla®.  (This is after he got involved with SpaceX, which will be important Monday.)  At the end of 2016, Tesla had sold 182,115 cars.

This is the total.  For all time.

Musk indicates that he will ramp Model 3 production up to 500,000  . . . a year.  Let’s say that he can ramp it up (normally he does meet goals, sometimes late) and produce that for 10 years.  That’s five million cars.

Impressive!

Currently, Tesla® is worth $53.7 billion.  Dollars.  That total comes from the total number of shares of Tesla™ divided by the current share price.  So, just for grins, let’s divide that $53.7billion by the five million cars he plans to produce.

That’s $10,740 per car.  In the next ten years.  Certainly he could produce more, but he’s not even produced his stated goal of 500,000 per year yet.

Ford® made 6.6 million cars.  Last year.  Assume ten years of steady production? 66 million cars.  Ford™ is worth $44.3 billion dollars (and actually makes a profit).  Divide $44.3 billion dollars by 66 million cars?  That $671 per car.

Okayyyyy . . . is Tesla worth fifteen times what Ford® is worth?

What about Daimler A.G.?  They make Mercedes-Benz©, which are awesome cars.  Things the Germans build well?  Tanks and cars.  Thankfully they’re building cars now.  Daimler makes only about 3 million cars a year.  (But, they’re AWESOME cars.)  So, 30 million cars in ten years.  They are worth about $74.5 billion dollars, or $2500 in stock per car.  But, Daimler pays a dividend of 5% per year, too.  And it makes a profit.

But the post is titled, “Will you buy a Tesla™ 3?  You already have.” not, “Is Tesla® stock stupidly overpriced?”

Cars (for me) are (mostly) a utility.  If I can get from one place to another reliably and cheaply, that’s really all I want out of a car.  I think that carpet in any pickup is a travesty.  And air conditioning?  That’s not for closers.  And I have skin in the game (I’m talking to you, Taleb (LINK )) as this is the way I live my life.  Old car.  New car.  Clown car.  Really doesn’t much matter to me (LINK).

But a Tesla 3© is not low cost.

Musk claims that about half the country could afford one, and I’d argue that he’s very pretty far off the mark on this one.  I still suggest that spending you shouldn’t buy a car that costs more than 15% of your gross income.  If you follow this rule, you can afford a Tesla 3®, if your income is $230,000 a year.  Or more.  If we relax that to 20%?  You can get one if you make $175,000 a year (or more).

So, there is some subset of people who can afford a Tesla 3©.  Just not all that many, since the average family income in the US is about $52,000.  (And, remember, cash only!)

Furthermore, the average age of people in the US is 37.8 years.  The average net worth of the average forty-year-old is $52,000.  There is no planet (except Mars?) on which I’d suggest you sink 70%+ of your net worth into a car.

But, let’s say you could afford a Tesla 3®.  Should you get one?  Maybe???

The Tesla 3™ is a sedan.  The Toyota Camry© is a sedan.

The Tesla 3™ costs $35,000.  The Toyota Camry© costs $23,000.  (Both are base models.)

At $0.14/kW, a Tesla 3® costs (in energy) $0.034 per mile.

At $2.50/gallon gasoline, a 30MPG Camry© costs $0.083 per mile.

So, a nickel a mile is what you save by driving a Tesla 3©.

Good deal.  The average driver drives 12,000 miles per year.  So, the $12,000 difference in cost between the Tesla and the Toyota?  Yeah, you’ll earn that back in 20 years after driving 240,000 miles.  If you still have the Tesla after 20 years.  Everyone keeps a car 20 years, right?

That’s a lame payout, $600 per year on $12,000.  But on that 21st year?  That $600 is all yours, baby!

What about $4.00 gas?  Pays out in about 10 years.  $7.00 gas?  Five years.  Now we’re talking!  Gas has been at that price . . . never.

But Elon isn’t stupid.

And you’ve already bought one of his cars.

I know, you’re saying, “John Wilder, I’m not an Internet billionaire!  How can I afford one?”

You paid taxes.

And if you buy a Tesla 3®?  You get a $7,500 tax incentive.  From the federal government – that, after a fashion, everyone else pays for.  So if you didn’t buy one?  You still kick in for everyone else’s car.

State level incentives exist as well, from $0 (sane states), up to a whopping $9,500 income tax credit in Louisiana.

If you live in the right state, a Tesla 3® actually costs less than a Camry™, thanks to everyone else kicking in for your car.

But not really.  In theory, Musk actually has to produce your car.  And if you’re over a pre-determined maximum number of cars (200,000), the credit drops, then, eventually disappears.  But I’m betting that Musk has another plan altogether, and, in some fashion, he’ll continue shifting the cost of the Tesla 3® to other people, so it might be a good deal for the purchasers.

But, like I said, you already bought one.

It’s just that someone else is owns it.

Like I said – Musk has a plan.  Come back on Monday and I’ll clue you in as to what it is.

PLEASE do NOT take this blog as tax advice.  I am not a registered phlebotomist, or whatever the person is who does taxes.  Entering this record into court might be amusing, but it certainly won’t help you, unless you want to go to prison for tax evasion.

Also, I do NOT have positions in any of the stocks mentioned, nor do I intend to take any, because the market can stay stupid longer than I can stay solvent.  I am not a financial planner.  But I am a dancer!

Peak Oil, Fracking, and Fashion

“There’s no such thing as gas shortage man, its all set up by the government, everything’s controlled by the oil companies like I heard about this guy who invented a car that runs on water man, its fiber glass, air cooled and it runs on water!” – That 70’s Show

DSC02359

That twisty line is the road to the North Slope.  The straight line is the Alaska Pipeline, see all the dead wildlife?  No?  Good times.

There are a lot of new readers to the site, so I thought I’d throw out some general notes: 

  • New posts every Monday, Wednesday and Friday. My time, so if you get up early in London, might not be there yet.  You know who I’m talking about.

  • Mondays are Big Ideas (Wilder Weekly Wisdom). Wednesday is Wealthy Wilder.  And Friday is focused on health, mostly. 

Energy from oil allows us to move at great speed through space, hurl our ideas to one another at nearly the speed of light, and grow and move food to feed billions that would otherwise have no chance at life.  It heats us, cools us, and, most importantly, cools our beer.

Energy from oil is the most critical question of our lifetimes.  Unless you count fashion.  And I have NO IDEA what I’m wearing tomorrow!!!

There’s always some fuddy-duddy in the background during the party on Saturday night saying, “Hey, dudes, you are going to have SUCH a hangover tomorrow.”  In the 1950s, that party was oil and the person was M. King Hubbert.  And everyone smoked and drank martinis, and listened to Sinatra on their gramophones.

In a really short version, Hubbert said that there’s really only so much oil in the ground.  I know that you’re saying, “Duh, John Wilder, we know that, since the Earth is essentially a finite bounded sphere.”

Well, Mr. Internet-Smart-Pants, Hubbert made his claim on a much more immediate basis.  We were going to hit peak production in the whole world in 2000.  Here’s his original graph:

Hubbert_1956

(Source, M. King Hubbert, 1956)

Amazingly, Shell Oil paid him to do stuff like this.  At work!  Sounds like a job John Wilder needs.

From this, you’d take it that we currently live in a Mad Max® style Road Warrior© land populated by ex-football players chasing Mel Gibson.

ROAD WARRIOR

But no, I have it on good advice that Australia is currently engaged in a long term war against New Zealand, where the primary combat mode consists of Australia discussing the quality of wool produced by New Zealand sheep (shameful, what!) and New Zealand continues to pummel Australia in rugby.  (Note to Australia – I’ll get off your back when you get above 1% of my monthly visitor count, and I’ll start drinking Fosters® again.)

So what happened?

Well, Hubbert was really kinda exactly right.

Here’s the graph of what Hubbert predicted for United States oil production.  There’s a lovely peak in 1973.  Hubbert drew this out almost 20 years before then, so he nailed it, within months of actual United States oil production.  This prediction was almost spot on and pointed to the first time that OPEC (Oil Producing and Eating Communists) could use oil as a weapon, which they did with the Oil Embargo of 1973.  Thankfully, the federal government controlled oil prices so that they could ensure that we had very long lines at the gas stations.

hubbert united states

(Source, M. King Hubbert, 1956)

But then we get to something interesting – here’s the graph of oil production since then.  There was a secondary peak in the late 1980’s.

chart

That secondary peak was from production coming from Alaska’s North Slope shooting down the pipeline and buying freedom and crushing the Soviet Union.  Part of Reagan’s strategy to bring down USSR was to deprive it of cash.  The Saudi government opened the spigots, the United States drilled away, and, the Soviet export of crude oil no longer brought it the cash it needed for Pez® and nuclear bomb parts to build more missiles to get through the missile defense screen we were pretending to build.

Reagan destroyed the Soviet Union . . . using cheap oil.

But, like I said, Hubbert was still pretty much on the nose with his US prediction, since he excluded new technology and unconventional (Arctic, Deep Sea) oil.  The Arctic was really the first of the extreme locations that we looked for oil in the United States.  We followed it up with locations mind-numbingly deep in the Gulf of Mexico.  And that’s how we extended Hubbert’s curve.  But then oil hit $120 a barrel.  People freaked out!  The end of cheap oil was everywhere!

First we extended Hubbert’s curve.  Then we blew it out of the water (in BP’s case, they took that a little too literally in the Gulf of Mexico).

That last little spike upward?  That’s oil from fracking.  Yes, whereas “frack” used to just be a made-up cussword (you know, like “felgercarb”) on Battlestar Galactica, “frack” now stands for money.

frack2

Fracking is the process of drilling horizontally into an oil-bearing layer of rock and jacking the pressure up higher than a Colorado bed and breakfast.  Bits of sand and chemicals are introduced to hold open cracks in the rocks to allow oil to flow out.  And how does it work?

Fantastically.

The oil and gas produced from fracking allowed the US to reach near all-time production in a relative eye-blink of a time.  It’s distorted the entire economic picture of the world again, since the US can effectively produce a significant amount of its required production in a fairly quick period of just a few years.

This new technology allowed the world to find new reserves that were unthinkable in the 1950’s.

But are they good reserves?  Fracked oil and gas produces about 85 units for each unit of energy invested.

Let’s compare them to the rest of the crowd:

eroi

By Mrfebruary – Own work Data from Table 2, Murphy, D. J. and Hall, C. A. S. (2010), Year in review—EROI or energy return on (energy) invested. Annals of the New York Academy of Sciences, 1185: 102–118. doi: 10.1111/j.1749-6632.2009.05282.x http://onlinelibrary.wiley.com/doi/10.1111/j.1749-6632.2009.05282.x/pdf, CC BY-SA 3.0, https://commons.wikimedia.org/w/index.php?curid=16238068

Wow.  Fracked oil produces MUCH more energy than most everything we currently produce.  And while we’re right now fracking only the best spots, and the return on energy will drop, it’s still really, really high.  Oil sands up in Canada have about a 4:1 return, so I expect, based on their relatively poor energy production (plus huge unpopularity) that they’ll not be an investment hub in the near future.

And, I’ll admit – I didn’t see this coming.  My original take on fracking was that it was a side-show – that the energy produced would actually be an energy drag on us – taking almost as much energy to produce as it took to drill the wells.  Nope.  Totally wrong.  Fracking will be with us for decades.

Why do I predict this?

  1. People like driving.
  2. People like plastic things.
  3. People don’t like living cold and in the dark.
  4. Given the current return on energy invested? Fracked oil is huge.

I would guess we have at least 10 years’ worth of high quality fracked oil, if not 20 or 30.  I don’t have the data (and couldn’t find it easily) but this may be the most important question of your life – how does fracked oil impact the Hubbert curve?

I know that many folks are of the hope that we will get rid of oil, natural gas, and especially coal.  I’m sorry for you, really, because as the graph of United States energy consumption shows (below):

renewable energy

  • Renewables are pitifully small and, if they keep growing at this rate, might be 20% of the energy in the country by 2435.
  • Oil use dropped when it was a $120 a barrel. Headed back up now.
  • Natural gas is now much cheaper than a decade ago since they’re finding it everywhere (fracking). Huge growth.
  • Coal has dropped, primarily due to making it tough on coal electricity providers. Still a huge player in electricity production.
  • Nuclear is level. The things are horribly hard to build and hard to get rid of, too.
  • Biomass is steady-ish.
  • Hydroelectric (our best ROI!) is flat and at the bottom. Nobody wants a new dam, but you have to have dams to have the cleanest energy source possible.

But let’s see how that compares to the rest of the world:

Bp_world_energy_consumption_2016

By Martinburo – Own work, CC BY-SA 4.0, https://commons.wikimedia.org/w/index.php?curid=53803246Oil
  • Oil, increasing.
  • Coal, increasing. A bit of a drop off (probably mainly the US).
  • Natural gas.   Steady.
  • Meh.  Mainly replacing nuclear.
  • Nuclear – dropping off.

I’m pretty much at the point where, although I see that forests of wind farms have been built, and California has this Death Star® array where they fry birds with a million mirrors focused on a big Rubik’s Cube® filled with molten salt, I’m not impressed.  Okay, I really am impressed that they talked someone into building this Dr. Evil-style structure out in the desert, and I’m expecting it to show up in the 2028 movie, Kingsmen:  Diamonds Sunlight are is Forever.

Just like you, I’d love to live in a world powered by clean, renewable energy, where everyone loved one another, and Disney® wasn’t in the process of destroying Star Wars©, but that’s not where we live, and if we tried to go there?

Billions would die. (not from the Star Wars™ thing, but from the lack of energy thing)

Fortunately, not many would die where I live, but mainly in the rest of the world.  I’d be fine, and, probably you too since you’re a reader of this blog and thus smarter than 99.999% of humanity and everyone in Australia (again, Australia, I know you speak English, so start visiting and I’ll activate a truce).

Unless we get a breakthrough in physics or oil suddenly disappears from the Earth due to a virus cunningly devised by an evil scientist named Mike, oil will be the primary power source for decades.  After that?

It’s the most crucial question that we’ll ever face as a species.

Except for fashion.

Oh, I do know what I’ll wear tomorrow!  That was easy!

Risk of Sudden Wealth . . . Over Rated? Are you Nic Cage, or Keanu Reeves?

“What’s in the bag? A shark or something?” – Nic Cage, The Wicker Man

DSC03299

How I imagine Elon Musk hunts for ducks.

In panning for gold, I can’t help but wonder what would happen if I found a whole bunch, all at once.  My mind wanders.  All the beef jerky I could wear.  All the Lear® Jets I could eat.  I’d be fine, right?

Well, it seems like there are a pair of psychologists (Joan DiFuria and Stephen Goldbart, LINK) who described “Sudden Wealth Syndrome.”  They describe the following symptoms (my comments in parenthesis):

  • Anxiety/Panic Attacks (Try the Panic Attack from not being able to pay your Pez© dealer, I assure you they don’t take kindly to folks who can’t pay for the sugar)
  • Worries About Money (Hmmm, this seems a bit forced?)
  • Worries About Stock Market Volatility (Elon Musk probably doesn’t lose much sleep in his orbital habitat)
  • Insomnia (I can see millions of dollars keeping me awake all night – especially since I’d be partying in Elon’s orbital habitat)
  • Irritable Mood (Yes, I can see being irritable because I was too flush with cash, and I get mad because my pancakes are too fluffy)
  • Guilt About Having Money (This is real – otherwise explain why every Hollywood actor wants ME to pay more in taxes)
  • Identity Confusion (Once I found a twenty dollar bill, and became convinced I was Luke Skywalker© – but in truth, I was 12)
  • Fear of Loss of Control (The idea of being without a mortgage should make us all shake with fear)
  • Paranoia (Are you threatening me?)
  • Depression (I’m so sad, I can’t count as high as my money, no matter how long I live!)

From that description, it sounds like winning sucks, eh?  I assure you that, in the choice between having money and not having money, I MUCH prefer having money, and as a business model, catering to very, very wealthy people with neurosis is probably very profitable.  I like the way those guys think!

But let’s put this in context.  Think about the behavior of the typical twenty-something starlet or rock star that’s rolling in cash?  They tend to make a lot of poor choices, primarily because nothing in their experience has prepared them for the sudden onset of cash.  By contrast, many of the folks who do really well with money at an early age (Think Bill Gates and Paul Allen) had a really well-to-do upbringing.  Not rock star rich, but they were going to exclusive private schools.  They’d been taught how to deal with money early on, and, likely never had to worry much about not having it.

But let’s pick on Nicolas Cage.  Why?  Face/Off is probably reason enough.  Really?  Swapping faces with John Travolta?  That’s the movie plot?  I won’t pick on Shia Lebeouf because that’s like a velociraptor picking on a kitten.

Nic Cage (he told me he didn’t mind me calling him that when I imagined talking to him) made millions as an actor.  He could have done that if they only paid him a dollar a movie, but he made much more, at least $20 per movie.  Again, he made millions.  $150,000,000.  Yes.  ONE HUNDRED FIFTY MILLION dollars.  American dollars, not fake ones like they print in Canada.

He spent it all.  ALL OF IT.

On what?

  • An $8 million dollar castle in England. He spent millions fixing it up.  Never spent a night there.
  • An island.
  • Four yachts. At the same time.
  • A pair of rare albino king cobras.

Let’s face it, the man had a whole small country plus a navy (yes, four boats is more than in all of Canada) plus king cobras.  I’m not sure why he didn’t get three albino king cobras, but, he settled for two.

Seriously – was Nic Cage trying to live exactly like the bad guy in an Austin Powers movie?  No, I think that there’s something missing, plus nobody can figure out how to tell a guy not to blow all of his money on shiny things.

From observation, I do think that sudden wealth, or worse, sudden wealth and fame is not really good for you.  I think that it can greatly distort the sense of self.  Bill Murray said that everyone is a jerk (not exactly the word he used, but you get the idea) for the first year after they become rich and famous.  He then followed up with the observation that some people never snap out of it.

And, from the way that stars handle fame, it looks like many of them fall into DiFuria and Goldbart’s Sudden Wealth Syndrome.  They’ve got money but the feelings that they have wrapped up around the money give them a lot of guilt.  Some, however, seem a bit more grounded:

It has been reported that Reeves gave approximately US$80 million of his US$114 million earnings of The Matrix sequels, The Matrix Reloaded and The Matrix Revolutions, to the special effects and makeup staff. – Wikipedia

That seems a bit more grounded.  Warren Buffett lives in a house that (per the Intertubes) is worth $652,000.  I’m pretty sure it’s paid for, since Warren is worth $76.7 billion dollars.  That also seems pretty stable, since he bought it in 1958.

Lottery winners also seem to have a problem.  The first problem they have is the inability to do math.  Now, if there’s a tax that I like, it’s a tax on folks who can’t do math.  But the general saw is that some sort of karma hits the lottery winners, and makes them miserable.  And those stories are the big ones in the news.  But the reality?  85% of winners keep going to work (based on one study I saw) and most of those (60%) were still working at the same place they were before they won the lottery.

It seems that we almost want to hear the tragedy, because it suits our sense of fairness – this poor person who didn’t know math lucked out, but, boy, karma got ‘em in the end.  Nah.  Most of them seem to do just fine – more like Warren Buffett, less like Nic Cage.

Me, if someone bought me a lottery ticket that one, or I hit a pocket of gold worth $150,000,000?  An 8,500 pound (that’s about 17 kilograms) pocket of gold?

I’m headed to the Musk’s space habitat.  Beer’s on me.